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Showing 21 to 40 of 1434 Records
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2022 (1) TMI 1417 - ITAT MUMBAI
Addition u/s 43CA - difference between the agreement value and market value as per registered agreement - assessee stated that payment & allotment letters for the impugned items were received much earlier - CIT(A) has held that he was of the opinion that invariably the stamp value date on registration has to be adopted and hence, he was upholding the order of the AO
HELD THAT:- CIT(A) conclusion is quiet contrary to what the AO has held. AO has clearly accepted the assessee’s contentions that he is in agreement that ready recokner value on the date of allotment is being considered. Hence, the reason for CIT(A) in upholding the addition is not as per the facts on record.
In any case, we note that this is assessees plea that section 43CA was introduced w.e.f. 01.04.2013 and the agreement under consideration were entered into prior to 31.03.2013.This is assessees plea that difference is only 5% between the ready recokner rate and sale consideration.
Hence, this is assessees plea that the same has to be ignored on the touchstone of Krishna Enterprises vs ACIT[2016 (12) TMI 52 - ITAT MUMBAI] - Thus issue decided in favour of the assessee.
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2022 (1) TMI 1416 - GUJARAT HIGH COURT
Reopening of assessment u/s 147 - Bogus LTCG - Penny stock transactions - reason to believe - information received from the intelligence being of Kolkata is only information relied upon - independent application of mind v/s borrowed satisfaction - Tribunal allowed the appeal of the assessee by holding that the Assessing Officer’s reasons recorded fall in the zone of “reasons to suspect” and not “reasons to believe”
HELD THAT:- Undoubtedly, there exists a material on record that after the original assessment was concluded, the information had been received from the Investigating Wing, Kolkata, which carried on the survey and search operations, where it was established that the large number of penny stock companies share prices were artificially manipulated on the stock exchanges in order to book bogus claims of LTCG/Loss.
The statement had also been recorded of Shri Sanjay Vora u/s 131 of the Act, which does not contain the name of the assessee and it also does not relate to the broker of assessee, since the sale is not through M/s.Anand Rathi Shares and Stock Brokers Ltd., but through Arcadia Share and Brokers Pvt.Ltd. Thus, on obtaining this information, there shall need to be a reason for formation of belief that there is a rational connection having live link between the material coming to the income tax officer and his formation of belief that the income chargeable to tax has escaped the assessment of the particular year.
Even when the Court is not required to go into the sufficiency or adequacy of the material, it is a must for the AO to establish the rational connection of direct nexus or live link between the material coming to the notice of the officer and formation of his belief. There does not appear to be any material connecting the present assessee, where information in relation to the third party has been used by the AO. There is nothing to indicate as to how in absence of any explicit connection of the assessee with the information received from the another agency, the reassessment proceedings have been initiated. The statement recorded of Shri Sanjay Vora also does not name the assessee nor has there been any link of the broker through whom the assessee has sold the shares.
Of course, the company whose share has been purchased by the assessee is alleged to be one of the penny stock companies. Therefore, the reasons recorded were drawn from survey and search operation in relation to the other assessees and therefore, the requirements of the statute does not appear to be satisfied. Even if, there is a needle of suspicion towards the assessee, the Assessing Officer shall need to act upon his own belief that the twin conditions required under the statute are satisfied before he initiates the proceedings of reassessment.
this Court cannot be oblivious of the requirement of satisfying these conditions before the reassessment proceedings are initiated, there appears to be a borrowed satisfaction. It has chosen to merely considered the information/material received from other source without forming any independent opinion on the basis of the material on record that income has escaped the assessment. His suspicion of the assessee dealing with the shares and claiming of LTCG would not provide the sufficient grounds for reopening.
The exercise which is based on suspicion is not permissible for reopening and any notice for reassessment in such circumstances would need to be termed as a fishing inquiry only.
The Apex Court interpreted the word “reason to believe” in case of Central Prominces Mangnese Ore Company ltd. (1991 (8) TMI 4 - SUPREME COURT] it held that, the word “reason” in the phrase “reason to believe” in Section 147, would mean cause or justification to know that income had escaped the assessment he can be said to have reason to believe. This expression does not mean that the Assessing Officer should have finally ascertained the fact by legal evidence or conclusion.
AO to form the opinion there shall need to be some link with the material and as discussed above, the same is missing, the challenge needs to fail. Though no rigid format is a must to express application of mind or for formation of belief that income chargeable to tax has escaped assessment and yet, when reliance on the information is mechanical without reassessment for the verification, independent opinion needs to be held to be absent. Decided against revenue.
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2022 (1) TMI 1415 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI.
Reconsideration of approved Resolution Plan - the ‘Assenting Financial Creditors’ (AFC) constituting 94.98%, who have approved the Resolution Plan submitted by the SRA has filed an affidavit stating that they feel duty bound to reconsider their decision in larger public interest resulting from unprecedent haircut of 95% & observations of the Adjudicating Authority as also this Appellate Tribunal.
HELD THAT:- Power to reconsider any decision is within the domain of CoC and even Hon’ble Apex Court in Catena of judgment held that the commercial wisdom of the CoCs is non justifiable and hence, it is in the domain of CoC, particularly, if at a later stage, it finds in public interest and the amount of loss which the public exchequer is to bear with such unprecedented haircut in such a large fund employment, it is in the fitness of thing that the proposal can be remanded back to the CoC, particularly, in view of their own affidavit to review their decision. The CoC is not functus –officio on the approval of the Resolution plan and accordingly, the judicial precedents clearly established that the Adjudicating Authority and this Tribunal is competent to send back the Resolution plan to the CoC for reconsideration.
The Hon’ble Supreme Court decision in Committee of Creditors of Essar Steel India Ltd, Through authorized signatory Vs. Satish Kumar Gupta & Ors. [2019 (11) TMI 731 - SUPREME COURT] had referred and affirmed this power to remand back.
In the present case, the resolution plan is not complying with Section 30(2)(b) of the Code r/w Section 31 of the Code. Hence, it can be remanded back to the CoC.
Vide para 4 of the Resolution Plan on overview of the implementing entity / resolution applicant, it reveals that the resolution applicants group turnover is Rs. 84,447 crore in the year 2019-2020 (para 4.2.2 of the Resolution Plan- page 253 of CA(AT) (Ins) No. 503 of 2021). Vide para 7.1.2 of the Resolution Plan, the Resolution Applicant has accepted the requirement of approval / permission of CCI in accordance with the Code prior to the approval of CoC. In the 19th CoC meeting held on 11.11.2020, the CoC were apprised of acknowledgment copy of the applications filed with the CCI seeking CCI approval of the resolution under the present case.
It is very much clear that prior approval of the CCI has not been obtained as per proviso to section 31(4) of the Code. This reflects that the approved Resolution Plan requires review and reconsideration for the legal compliances. Statutory compliances does not fall under the commercial wisdom of the CoC. Hence, the statutory compliances as mandated by proviso to Section 31 (4), have to be ensured before the Resolution Plan is approved by CoC.
Section 30 (2)(b) of the Code has not been complied with and hence, the approval of the Resolution Plan is not in accordance with Section 31 of the Code. Accordingly, the approval of Resolution Plan by the CoC as well as Adjudicating Authority is set aside and the matter is remitted back to CoC for completion of the process relating to CIRP in accordance with the provisions of the Code.
Appeal dismissed.
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2022 (1) TMI 1414 - ITAT KOLKATA
Denial of credit of TDS - HELD THAT:- A perusal of the impugned orders of the ld. CIT(A) reveals that the ld. CIT(A) after considering the submissions of the assessee has directed the AO to verify the claim of the assessee and allow the necessary credit of the taxes paid/deducted at source as per law. Since the CIT(A) has already granted relief to the assessee by directing the AO to verify the claim of the assessee, therefore do not find any reason to interfere in the order of the ld. CIT(A). The appeals of the assessee are, therefore dismissed.
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2022 (1) TMI 1413 - SECURITIES APPELLATE TRIBUNAL, MUMBAI
Power of SEBI statutory initiating action against statutory auditor / chartered accountant - Misutilization of IPO proceeds - funds diverted to different entities in the guise of making payments towards the objects stated in the prospectus - role of the appellant as the statutory auditor with regard to due diligence done by it by certifying the expenditure incurred by the company towards the IPO expenses out of the IPO proceeds - HELD THAT:- We find that the A.O. has only found that due diligence was not carried out by the appellant. There is no finding that the appellants were instrumental in preparing false and fabricated accounts or have connived in preparation or falsification of the books of account. There is no finding that the appellants had manipulated the books of accounts with knowledge and intention, in the absence of which, there is no deceit or inducement by the appellants. In the absence of any inducement, the question of fraud committed by the appellants does not arise. This Tribunal in Price Waterhouse [2019 (9) TMI 592 - SECURITIES APPELLATE TRIBUNAL, MUMBAI] has categorically held that a C.A. can be proceeded against them if they are instrumental in preparing false and fabricated accounts otherwise SEBI has no power to proceed against them.
29G Section 12A(a) & (b) of the SEBI Act is obviously not applicable to the appellant as they are not dealing in the securities. Similarly, Section 12(c) cannot be made applicable because no fraud has been carried out by the appellant. Further, in the absence of connivane, deceit, or manipulation Regulation 3 &4 of the PFUTP Regulations cannot be made applicable.
The appeal is hereby allowed with no order as to costs.
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2022 (1) TMI 1412 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI
Violation of principles of natural justice - non-speaking order - Validity of Resolution Plan as approved by the CoC - extinguishing claim to the Fixed Deposit Holders without discharging their payments in full - NHB Act or RBI Act, as the case may be, mandate the full payment to the Fixed Deposit Holders even though the corporate Debtor is undergoing CIRP or not? - Section 238 of the Insolvency and Bankruptcy Code, 2016, overrides the RBI Act and NHB Act? - transactions involving repayment to Fixed Deposits Upon maturity of their deposit would fall within the ordinary course of business for Respondent No. 1 or not - authority for disbursing loans and investments despite its failure to repay Fixed Deposit holders as per the terms of their deposits - payment made against the F.D.'s in terms of their deposits during CIRP would be categorised as a preferential transaction or not.
The impugned order is non-speaking, and it violates the Principles of Natural Justice - HELD THAT:- The impugned order approving the Resolution Plan is passed with a non-speaking order without any discussion on the objections raised by the Appellants
The obligation of the Administrator and the successor-in-interest of DHFL to ensure full repayment of deposit to FD holders under the RBI and NHB Act - HELD THAT:- The relationship between the customer and the Bank is the creditor and debtor and not a trustee. The Bank is not a trustee of money deposited by customers. In this case, the Corporate Debtor, i.e. DHFL, took fixed deposits from their customers on the agreed interest on the amount invested in the fixed deposits. Therefore, the relationship of the DHFL with the fixed deposit holders is that of a creditor and debtor and not of a trustee. The money so deposited becomes a part of the DHFL's funds which is under a contractual obligation to pay the sum deposited by a customer to him and on maturity or as per the terms of the contract they were getting agreed rate of interest. Such a relationship between the DHFL & the fixed deposit holders is one of the creditor and debtor and not of a trustee.
No Locus to maintain the Appeal - HELD THAT:- Based on the orders of the Hon'ble Supreme Court in the case of VINAY KUMAR MITTAL & OTHERS VERSUS DEWAN HOUSING FINANCE CORPORATION LTD. & OTHERS [2020 (2) TMI 33 - SUPREME COURT], wherein right is given to the Appellants to raise the issue before NCLT/NCLAT the appellants have filed the appeal. Therefore contention of the respondent COC that the appellant had no locus to file the present appeal is not sustainable.
Resolution Plan is discriminatory as it creates class within a class of similarly situated creditors - HELD THAT:- The legislative intent is clear that F.D. Holders are entitled to the same rights and protections as per the terms of the Code as every other Financial Creditors of DHFL - Based on the observations of the Hon'ble Supreme Court in CHITRA SHARMA AND ORS VERSUS UNION OF INDIA AND ORS [2018 (8) TMI 661 - SUPREME COURT], it is clear that during the pendency of the CIRP, it is impermissible for the Court to direct a preferential payment being given to a particular class of financial creditors, whether secured or unsecured. Therefore, Fixed Deposit Holders as a class cannot claim a separate treatment during CIRP. If payment is made during CIRP to a particular type of deposit holder, it will amount to a preferential disbursement to a class of creditors - thus, no payment can be made during CIRP. If any payment is made to the F.D. Holders during CIRP then it will amount to preferential treatment to a particular class of creditors, which dehors the provision of the Code, which is impermissible under the Code.
The I & B Code, a subsequent enactment, overrides the provisions of the NHB Act, NHB Directions and RBI Act - HELD THAT:- Section 45-MBA of the RBI Act does not contain a non-obstante clause but rather a 'without prejudice clause'. Section 45-MBA in fact, preserve the rights of the RBI to act under all other provisions of the law and provide flexibility. Had it been the intention of the legislation to require RBI only to pursue insolvency resolution of NBFC under the IBC prescribed under the RBI Act, then the same would have been expressly provided by the legislature by including a non-obstante clause in Section 45-MBA. The said section retains discretion with the RBI to resolve the insolvency of an NBFC under the RBI Act or any other provision of law, including IBC. Further, the FSP rules were enacted after Section 45-MBA. Hence, the provisions of the FSP Rules are also significant in this regard - it is the commercial wisdom of the requisite majority of the Committee of Creditors which is to negotiate and accept the Resolution Plan, which may involve differential payment in different classes of creditors, together with negotiating with the prospective Resolution Applicant for better or different terms which may also involve differences in the distribution of amounts between the different classes of creditors - no special dispensation ought to be granted outside the mechanism/process envisaged under the IBC, which provides for the commercial wisdom of the COC to reign supreme for the distribution of funds.
Recoveries from avoidance Application - HELD THAT:- It is pertinent to mention that the Appellant's/Fixed Deposit Holders had filed different Miscellaneous Applications after approval of the Resolution Plan challenging the same on the ground that Resolution Plan extending the recoveries made under Applications filed under Sections 43-51 and Section 66 of the Code shall be whatsoever may be for the benefit of the Resolution Applicant is contrary to law and void ab initio and non-est in law.
Decision on this issue about recoveries of avoidance application is also treated as a decision in the instant Appeals - HELD THAT:- The NCLT/NCLT has been endowed with limited jurisdiction as specified in the I & B Code and not to act as a court of equity or exercise plenary powers - The judicial review of the Adjudicating Authority that the Resolution Plan as approved by the Committee of Creditors has met the requirements referred to in Section 30 would include a judicial review that is mentioned in Section 30 (2) (e), of the Code and is also in compliance with the provisions of the law for the time being in force.
The F D holders are Financial Creditors of the DHFL and have been treated accordingly as per the provisions of the Code. It is also found that section 45Q of the RBI Act has no applicability in the facts of the present case. The decision about payments to the creditors falls within the commercial wisdom of the COC, subject to fair and equitable play, i.e. payment of minimum liquidation value to creditors. The commercial wisdom of COC is not amenable to judicial review of any kind - The I & B Code being a subsequent enactment, overwrites the provisions of the NHB Act, NHB directions and RBI Act. No right of full payment exists under the NHB Act or the RBI Act or under any other subordinate legislation. Even if it exists, any such right would be wholly repugnant to the provisions of the Code, which provide for a specific manner in priority of payment and sets out the right. The minimum amount a creditor is mandatorily required to be paid in the Resolution Plan, i.e. the liquidation value.
The issue raised about the outcome of avoidance application has not been decided here.
Appeal disposed off.
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2022 (1) TMI 1411 - ITAT AHMEDABAD
Rejection of rectification application filed by the assessee u/s 154 - submission filed by the assessee on the online portal - AR submitted that both the Revenue Authorities have not given any opportunity to the assessee for proper hearing and principles of natural justice were violated - HELD THAT:- We have heard both the parties and perused all the relevant materials available on record. It is pertinent to note that at any stage of the assessment proceedings as well as appellate proceedings, i.e. before the CIT(A), no opportunity was granted to the assessee for personal hearing to comment on the merit of the case.
Therefore, it will be appropriate to remand back the entire issue to the file of the AO for proper adjudication of the issues on merit and thereafter pass appropriate order as per due process of law. Needless to say the assessee be given opportunity of hearing by following principles of natural justice. Appeal of the assessee is partly allowed for statistical purposes.
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2022 (1) TMI 1410 - ITAT HYDERABAD
Addition u/s. 68 - unexplained partners investment in the assessee-firm - source for the amount introduced in the firm as capital and loan was not properly explained - since the interest credited to the partners account was in violation of the provisions of section 40(b) AO disallowed the claim of expenditure towards such interest and added the same in the hands of the assessee - HELD THAT:- With respect to unexplained cash brought into the firm as partner’s capital and loan from partners, neither the Ld. AR nor the assessee has established that the amount was accounted in the books of the respective partners of the firm. The amount is credited in the books of the assessee firm during the relevant assessment year without any corresponding entries in the books of the respective partners of the firm and there is no evidence to establish that the source of those funds are genuine and accounted. It is also obvious that the entire amount is appropriated and utilized by the assessee firm and not by the partners of the assessee firm.
From the above provisions of section 68 and the facts of the relevant case before us it is crystal clear that the assessee firm is directly hit by the provisions of section 68 of the Act.
Needless to mention that if the partners of the assessee-firm had introduced the cash in their respective books and thereafter transferred the same to the books of the assessee firm then probably the onus may be on the partners of the assessee firm to establish the source of the cash brought into their respective books and therefore addition may not be made in the hands of the assessee firm depending on the facts and circumstance of the case.
In the case of the assessee it is apparent that the cash was never introduced in the books of the partners of the assessee firm, but it was merely introduced in the books of the assessee firm. Therefore, the onus is on the assessee firm to establish the genuineness of the cash introduced in its books.
Since the assessee firm has failed to establish the genuineness of the cash introduced in its books obviously the addition has to be made in the hands of the assessee firm as held by the Ld. AO. Therefore, we hereby set aside the order of the Ld. CIT (A) and confirm the order of the ld. AO on this issue.
Further, neither the Ld. AR nor the assessee could establish that the amount debited in the P & L Account of the assessee firm as interest payable / paid to the partners of the assessee firm are not in violation of the provisions of section 40(b) of the Act.
CIT (A) has deleted the addition without making a clear finding on the issue. No merit in the order of the Ld. CIT (A) on this issue also. Accordingly, we hereby set-aside the order of theCIT (A) on this issue and the order of the Ld. AO is hereby confirmed. Decided in favour of revenue.
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2022 (1) TMI 1409 - CESTAT ALLAHABAD
Request to put on hold the re-export of gold of the applicant - HELD THAT:- After the matter was reserved for orders on 07.12.2021 and the said letter was filed by the learned Counsel for the appellant, the Departmental Representative also sent a letter dated 13.12.2021 including additional submissions received from Air Cargo (Export), New Delhi vide their letters dated 12.12.2021 and 13.12.2021. A perusal of those documents shows that the ownership of subject goods were a matter of dispute before the Dept Recovery Appellate Tribunal according to which the goods do not belong to the appellant at all and they belong to M/s Vee ESS Jewellers (to whom the appellant had exported the goods but who has not cleared them from customs) and that M/s Vee Ess Jewellers have hypothecated them to State Bank of India. Along with these documents vide the aforesaid letter Authorised Representative has also submitted that “allowing the re-export will frustrate the claims of the contending parties on the title of the goods”.
It is deemed appropriate that before for pronouncing the orders with respect to the compliance of the above mentioned final order and the miscellaneous order, the aforesaid two letters submitted by Departmental Representative, and the letter given in the record cases should be shared with the other side - learned Authorised Representative and learned counsel are directed to provide the aforesaid letters to the opposite side - matter thereafter be re-heard and compliance matter on 4th April, 2022.
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2022 (1) TMI 1408 - SUPREME COURT
Pension Scheme - retirement benefits - vested or accrued rights of an employee - whether at the given time, such vested or accrued rights can be divested with retrospective effect by the Rule making authority? - HELD THAT:- The concept of vested/accrued right in the service jurisprudence and particularly in respect of pension has been examined by the Constitution Bench of this Court in CHAIRMAN, RAILWAY BOARD AND ORS. VERSUS C.R. RANGADHAMAIAH AND ORS. ETC. ETC. [1997 (7) TMI 662 - SUPREME COURT] where it was held that The Full Bench of the Tribunal has, in our opinion, rightly taken the view that the amendments that were made in Rule 2544 by the impugned notifications dated december 5, 1988, to the extent the said amendments have been given retrospective effect so as to reduce the maximum limit from 75% to 45% in respect of the period from January 1, 1973 to March 31, 1979 and reduce it to 55% in respect of the period from April 1, 1979, are unreasonable and arbitrary and are violative of the rights guaranteed under Articles 14 and 16 of the Constitution.
Later, in U.P. RAGHAVENDRA ACHARYA AND ORS. VERSUS STATE OF KARNATAKA AND ORS. [2006 (5) TMI 514 - SUPREME COURT], the question which arose for consideration was that whether the Appellants who were given the benefit of revised pay scale with effect from 1st January, 1996 could have been deprived of their retiral benefits calculated with effect therefrom for the purpose of calculation of pension. In that context, while examining the scheme of the Rules and relying on the Constitution Bench Judgment in Chairman, Railway Board and Ors., this Court observed The Appellants had retired from service. The State therefore could not have amended the statutory Rules adversely affecting their pension with retrospective effect.
In the instant case, the Bank pension scheme was introduced from 1st April 1989 and options were called from the employees and those who had given their option became member of the pension scheme and accordingly pension was continuously paid to them without fail and only in the year 2010, when the Bank failed in discharging its obligations, Respondent employees approached the High Court by filing the writ petitions. The Bank later on withdrawn the scheme of pension by deleting Clause 15(ii) by an amendment dated 11th March, 2014 which was introduced with effect from 1st April, 1989 and the employees who availed the benefit of pension under the scheme, indeed their rights stood vested and accrued to them and any amendment to the contrary, which has been made with retrospective operation to take away the right accrued to the retired employee under the existing Rule certainly is not only violative of Article 14 but also of Article 21 of the Constitution.
Thus, non-availability of financial resources would not be a defence available to the Appellant Bank in taking away the vested rights accrued to the employees that too when it is for their socio-economic security. It is an assurance that in their old age, their periodical payment towards pension shall remain assured. The pension which is being paid to them is not a bounty and it is for the Appellant to divert the resources from where the funds can be made available to fulfil the rights of the employees in protecting the vested rights accrued in their favour.
Appeal dismissed.
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2022 (1) TMI 1407 - GUJARAT HIGH COURT
Violation of principles of natural justice - Rejection application for cross examination ex-parte without giving an opportunity of hearing - Clandestine manufacture and clearance of finished goods - HELD THAT:- The Court was addressing the issue of permitting the cross examination of those witnesses, whose statements had been recorded and who had not been examined as the prosecution witnesses - The Court relied on the decision of MS NAINA VERSUS COLLECTOR OF CUSTOMS, WEST BENGAL, CALCUTTA-I [1971 (6) TMI 11 - HIGH COURT AT CALCUTTA] where the Court has recognised the right of cross examination and any denial of opportunity on that count to be treated as the violation of principle of natural justice.
Thus, what has been made clear is that the subject to the statutory provision of Section 128 of the Act, it is the right of the parties in the adjudicatory process as to whom they need to bring on record as defence witnesses. It is held that it is the right of the parties against whom the show cause notices issued to call those persons to make a request for the defence witnesses of even those witnesses who have been dropped out by the department to be examined as defence witnesses - it was held that the same was impermissible as no one can be cross examined without being examined by one of the parties as the witness.
Section 128 of the Customs Act, which is pari materia with Section 14 read with Section 9 D of the Act. Now, Section 14 of the Act provides power to summon person to give evidence and produce evidence in inquiries. This authorizes the Central Excise Officer empowered by the Central Government to summon any person whose attendance he considers necessary either to give evidence or to produce a document or any other thing in any inquiry which such officer is making for any of the purposes of this Act.
As per the order which is impugned here, the statement of five persons were found to be relevant in the adjudication proceedings, they were admitted as evidence and therefore, the request for cross examination of those witnesses had been granted - Per se, there cannot be any dispute with regard to the right to examine the defence witnesses, however, that was never the request on the part of the petitioner. The application, which has been moved after this Court had quashed and set aside the order and remanded the matter back on having found the order-in-original to have been passed without availing an opportunity to the party, hence, no interference is desirable.
Petition disposed off.
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2022 (1) TMI 1406 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI
Order for keeping the approval of the ‘Resolution Plan’ in abeyance - HELD THAT:- Avoidance transactions of approximately Rs. 1000/- Crore has also come to the light - No doubt, it is a settled law that commercial wisdom of the ‘Committee of Creditors’ (CoC) is ‘supreme’ and cannot be interfered in a normal circumstance but when ‘figures of crore’ are emerging stagewise then there is no harm to look at the Expert opinion which the Adjudicating Authority in this case has asked for.
As far as the RP is concerned, he is treated as an ‘officer’ of the court and as appears to us, no adverse comment has been passed against him. He has only been requested to co-operate with the OL. There is nothing adverse against him.
There are no merits in these appeals - appeal disposed off.
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2022 (1) TMI 1405 - SUPREME COURT
Seeking grant of bail - Murder - pre-existing rivalry between the Respondent-Accused, his brothers namely, Arjun, Satyanarayn and Okramal and the deceased - HELD THAT:- There cannot be elaborate details recorded to give an impression that the case is one that would result in a conviction or, by contrast, in an acquittal while passing an order on an application for grant of bail. However, the Court deciding a bail application cannot completely divorce its decision from material aspects of the case such as the allegations made against the Accused; severity of the punishment if the allegations are proved beyond reasonable doubt and would result in a conviction; reasonable apprehension of the witnesses being influenced by the Accused; tampering of the evidence; the frivolity in the case of the prosecution; criminal antecedents of the Accused; and a prima facie satisfaction of the Court in support of the charge against the Accused.
Ultimately, the Court considering an application for bail has to exercise discretion in a judicious manner and in accordance with the settled principles of law having regard to the crime alleged to be committed by the Accused on the one hand and ensuring purity of the trial of the case on the other.
This is not a fit case for grant of bail to the Respondent-Accused, having regard to the seriousness of the allegations against him. Strangely, the State of Rajasthan has not filed any appeal against the impugned order - the High Court was not right in allowing the application for bail filed by the Respondent-Accused.
Appeal allowed.
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2022 (1) TMI 1404 - SUPREME COURT
Refund of the excess taxes and charges paid by the appellant to the municipal authorities - accrual of cause of action of continuing nature - lack of an occupancy certificate - complaint dismissed on the ground that it was barred by limitation - HELD THAT:- The NCDRC held that the cause of action arose when the municipal authorities asked the appellant to pay higher charges in the first instance and thus, a complaint should have been filed within two years of the accrual of the cause of action. The appellant however, has argued that the cause of action is of a continuing nature, since members of the appellant have continued paying higher charges as the respondent failed to provide the occupancy certificate.
A continuing wrong occurs when a party continuously breaches an obligation imposed by law or agreement. Section 3 of the MOFA imposes certain general obligations on a promoter. These obligations inter alia include making disclosures on the nature of title to the land, encumbrances on the land, fixtures, fittings and amenities to be provided, and to not grant possession of a flat until a completion certificate is given by the local authority. The responsibility to obtain the occupancy certificate from the local authority has also been imposed under the agreement to sell between the members of the appellant and the respondent on the latter.
It is evident that there was an obligation on the respondent to provide the occupancy certificate and pay for the relevant charges till the certificate has been provided. The respondent has time and again failed to provide the occupancy certificate to the appellant society. For this reason, a complaint was instituted in 1998 by the appellant against the respondent. The NCDRC on 20 August 2014 directed the respondent to obtain the certificate within a period of four months. Further, the NCDRC also imposed a penalty for any the delay in obtaining the occupancy certificate beyond these 4 months - This continuous failure to obtain an occupancy certificate is a breach of the obligations imposed on the respondent under the MOFA and amounts to a continuing wrong. The appellants therefore, are entitled to damages arising out of this continuing wrong and their complaint is not barred by limitation.
The NCDRC in its impugned order has held that the cause of action arose when the municipal authorities ordered the payment of higher taxes in the first instance. Further, the impugned order also states that the present complaint is barred by limitation as there is no prayer for supply of occupancy certificate - The NCDRC has held that the appellant is not a ‘consumer’ under the provisions of the Consumer Protection Act as they have claimed the recovery of higher charges paid to the municipal authorities from the respondent. Extending this further, the NCDRC has observed that the respondent is not the service provider for water or electricity and thus, the complaint is not maintainable.
In the present case, the respondent was responsible for transferring the title to the flats to the society along with the occupancy certificate. The failure of the respondent to obtain the occupation certificate is a deficiency in service for which the respondent is liable. Thus, the members of the appellant society are well within their rights as ‘consumers’ to pray for compensation as a recompense for the consequent liability (such as payment of higher taxes and water charges by the owners) arising from the lack of an occupancy certificate.
The NCDRC to decide the merits of the dispute having regard to the observations contained in the present judgment and dispose the complaint within a period of three months - the complaint is maintainable.
Application dismissed.
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2022 (1) TMI 1403 - CESTAT HYDERABAD
Re-classification of goods as per the HSN indicated in the supplier’s documents - recovery of differential duty under section 28(4) along with interest under section 28AA of Customs Act - penalties under sections 114A and 114AA of Customs Act - imported goods are general articles of iron and steel or whether they were parts of the OT crane system and HRSGS specifically designed for the purpose? - to be classified under customs tariff item 73089090 of the Customs Tariff Act, 1975 or not - HELD THAT:- It cannot be disputed that the goods should be classified as per their nature and as they are imported and that they cannot be clubbed with some other goods imported under other Bills of Entry to determine the classification. It also cannot be disputed that if the invoices describe or classify the goods differently, the assessee has to explain. In this case, the assessee discharged this burden by providing drawings and designs, explanation as to where each of the parts is used, an expert opinion that the goods were specifically designed for use in the plant and were not goods of general use, a Chartered Engineer’s certificate to the same effect.
The appellant has not produced any alternative drawings or designs or any evidence to show that the parts in question were only parts of general use and not ones designed for the plant. In the absence of any evidence in the appeal, it is not possible to fault the Commissioner for considering the reply to the consultative letter, the drawings and designs and the clarifications provided by the supplier to conclude that the parts in question were parts designed for the plant and were not ordinary articles of iron and steel.
The Commissioner has given her findings relying on Rule 1 (NOT RULE 2) of the General Rules of Interpretation, which states that classification shall be based on terms of the Tariff Headings and Section Notes and Chapter Notes and the titles of Sections and Chapters are for ease of reference only. She also referred to Section Note 1(f) to Section XV (under which Chapter 73 falls) which states that articles of Section XVI (machinery, mechanical appliances and electrical goods) are excluded from Section XV. She further relied on Section Note 2 of Section XVI, especially Note 2(b) which states that parts suitable for use solely or principally with a machine must be classified in the heading of the machine. General Rule of Interpretation 2(b), regarding which a submission is made, appears irrelevant to this case - What is important is to examine what are the imported goods intended to be. If they are articles of general use, they should be classified as such. If they are intended to be used in a particular way, they should be classified as such. If one imports a pillow and uses it to smother someone to death, it will be a murder weapon in the case under the Indian Penal Code but can still not be classified as a weapon under the Customs Tariff. It continues to be an article of bedding because it is intended to be used as an article of bedding and not as a weapon. What is relevant to classification whether the goods are goods of general use or they are designed for a particular use.
The imported goods, except the structural items on which the Commissioner confirmed the demand, were not general articles of iron and steel but were parts of the OT crane system and HRSGS specifically designed for the purpose - They were correctly classified by the Commissioner as parts of the power plant in the impugned order - They were correctly classified by the Commissioner as parts of the power plant in the impugned order.
The impugned order is, therefore, correct and proper and calls for no interference - Appeal of Revenue dismissed.
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2022 (1) TMI 1402 - SC ORDER
Dishonour of Cheque - vicarious liability - HELD THAT:- Application seeking exemption from filing C/C of the impugned judgment is allowed.
Issue notice - In the meantime, the proceedings qua the petitioner alone shall remain stayed.
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2022 (1) TMI 1401 - SUPREME COURT
Plea of alibi - fire arm injury - requirement to prove beyond reasonable doubt - discrepancy between the medical and ocular evidence - HELD THAT:- There is no discrepancy between the medical and ocular evidence but too much is sought to be made out by learned Counsel for the Appellant on the doctor not opining about the distance from which the fire arm injury was caused. Further, the eye witnesses are categorical that the other Accused attacked the deceased with knives. In such a process of five persons attacking the deceased it cannot be said that the deceased would be lying in the same position and, thus, there is every possibility of injuries both at the back and front. In the nature of the incident and the testimony of the eye witnesses, a doubt must be cast on the story and not merely some aspect of the food consumption pointed out.
The remaining arguments of learned Counsel for the Appellant are based on plea of defective investigation, absence of independent witnesses but then there is no reason why the eye witnesses story, which is believable should not be given full credence. The test which is applied of proving the case beyond reasonable doubt does not mean that the endeavour should be to nick pick and somehow find some excuse to obtain acquittal.
The last aspect urged by learned Counsel for the Appellant was that the IO has referred to the antecedents of the Appellant and other Accused, which has been erroneously taken into account by the High Court contrary to the statutory provisions of Section 53 of the Indian Evidence Act, 1872. The said provision stipulates that the previous bad character is not relevant except in reply, i.e., unless evidence has been given of a good character in which case it becomes relevant - despite best endeavour learned Counsel for the Appellant has not been able to cast any doubt on the impugned judgment of the trial court and the High Court.
The story put forth by the prosecution has been established and has not been dented by the Appellant Accused so as to cast a doubt and entitle them to benefit of doubt - Appeal dismissed.
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2022 (1) TMI 1400 - SUPREME COURT
Smuggling - Ganja - Section 50 of the NDPS Act - conviction u/s 20(b)(ii)(c) of the NDPS Act and - sentence to undergo rigorous imprisonment for 10 years and to pay a fine of Rs. 1 lakh - HELD THAT:- The recovery was in a polythene bag which was being carried on a Kanwad. The recovery was not in person. Learned Counsel seeks to expand the scope of the observations made by seeking to contend that if the personal search is vitiated by violation of Section 50 of the NDPS Act, the recovery made otherwise also would stand vitiated and thus, cannot be relied upon.
Appeal dismissed.
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2022 (1) TMI 1399 - ITAT BANGALORE
Accrual of income - Waiver of term loan - nature of receipt - addition made by the AO by holding that the principal amount of loan/borrowings taken by the assessee from banks and which were waived off by the banks, was income of the assessee - HELD THAT:- So far as the term loans were concerned, these were taken by the assessee for the purpose of capital assets from time to time. With regard to this loan, the amount did not come into the possession of the assessee on account of any trading transaction; the receipts were capital in nature being loan repayable over a period of time along with interest. Therefore, on waiver of this term loan, no benefit or perquisites arose to the assessee in the revenue field. On the other hand, it is a capital receipt.
Thus, the waiver of the term loan cannot be treated as income of the assessee. However, waiver of overdraft, letter of credit, pre-shipment advance, export bills, benefit had arisen to the assessee. These loans were received in the course of carrying on business of the assessee even if it was treated as loan at the time of receipt of said loan and waiver of said amount will result in revenue receipt and to be liable for tax. Since it was the money had been borrowed for day-to- day affairs and not for purchase any capital assets, the said loan were not term loan taken for the acquisition or purchase of capital assets.
On the other hand, it is used as a circulating capital not as a fixed capital and the money was used in ordinary course of business in carrying the day-to-day affairs of the assessee. Being so, writing off the over draft cash credit, letter of credit, pre-shipment advance and export bills, etc. which was received for carrying out the day-to-day operation of the assessee and waiver of the same to be treated as income of the assessee u/s 28(iv) of the Act.
Similarly, interest waiver, if any and if it is allowed as a deduction in any earlier assessment years, then only the waiver of such interest could be treated as revenue receipt liable to tax u/s 41(1) of the Act. With this observation, we remit this issue in dispute to the file of AO for reconsideration. Appeal filed by the assessee is partly allowed for statistical purposes.
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2022 (1) TMI 1398 - ITAT MUMBAI
Revision u/s 263 - As pr CIT assessee has incurred advertisement and publicity expenses and AO allowed the expenses without appreciating the legal position - Pr.CIT initiated the revision proceedings with the view that the advertisement and publicity expenses incurred by the assessee in the television are not admissible due to the fact that these are illegal and contravenes the Cable Television Networks (Regulation) Act, 1995 - HELD THAT:- Assessee is advertising in the same mode of advertisement in earlier years as well as continued to advertise in subsequent years, we also observe that no authority who approves the advertising in the television has initiated any proceedings under the Cable Television Networks (Regulation) Act, 1995 as per which assessee has contravened any of the Act of the Cable Television Networks (Regulation) Act or levied any fines/penalties. In absence of any proceedings against the assessee, it clearly indicates that the advertisement made by the assessee in the televisions are within the provisions of the above said Cable Television Networks (Regulation) Act, 1995. Therefore, in the absence of any such proceedings the Income-tax authorities have no jurisdiction to presume that assessee has contravened any provision of the Cable Television Networks (Regulation) Act merely because assessee has several products to market some of them may be prohibited to advertise and others are not.
One cannot presume that the assessee is only promoting the products for which advertisements are prohibited as long as the advertisements are allowed to broadcast in the televisions which is approved by the proper authority, the assessee cannot be penalized by invoking the provisions of Cable Television Networks (Regulation) Act, 1995.
Thus in the absence of any adverse remark or penalties levied by the broadcasting authorities the Assessing Officer need not go into verification of regular expenditure which assessee was regularly claiming over the years. We observe that Assessing Officer has also collected several information before allowing the expenses claimed by the assessee. Therefore Ld. Pr.CIT cannot invoke the provisions of section 263 of the Act to reassess the completed assessment merely on the basis of presumption or with the view that assessee may have contravened the Cable Television Networks (Regulation) Act, 1995. Decided in favour of assessee.
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