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Showing 61 to 80 of 1944 Records
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2017 (3) TMI 1886 - DELHI HIGH COURT
Acquiring of assets disproportionate to the source of income - cause of action has arisen within the territorial jurisdiction of this Court - whether the two Preliminary Enquiries registered in the present case pertain to the same incident or form part of the same transaction? - HELD THAT:- There is absolutely no basis for entertainment of the apprehension expressed by the petitioners to decide the present petition entirely on its merits, and merits alone. There is no justification for, or reasonableness in entertainment of any such belief by the petitioners.
There are no control over the thought process through which the petitioners may be going through. The issue is, whether there is any reasonable basis for the apprehension entertained and expressed by the petitioners with regard to the independence, nothing at all was found. Moreover, the said prayer has been made highly belatedly i.e. after the close of the hearing, even though the stated reasons for making his prayer were very much available even before the start of the hearing of the case. Accordingly, the prayer made by the petitioners that the case is rescued, is rejected.
In SUPERINTENDENT OF POLICE, C.B.I. AND ORS VERSUS TAPAN KR. SINGH [2003 (4) TMI 593 - SUPREME COURT], before the High Court of Calcutta, the accused successfully assailed the search & seizure carried out by the CBI, on the premise that the GD entry contained vague allegations and did not disclose commission of any cognizable offence. While holding that a General Diary Entry may also be considered as a FIR if it discloses the commission of a cognizable offence, the High Court held that in the said case before it the GD entry, could not be considered to be a First Information Report. It further held that subsequent registration of the First Information Report could not validate the search & seizure undertaken prior to such registration.
The First PE, the Second PE and the RC need to be examined as also the status reports filed by the CBI in the Common Cause PIL may be looked at. The petitioners have sought the disclosure of the contents of the Status reports filed by the CBI from time to time during the hearing of the Common Cause PIL. The CBI has not opposed the said prayer of the petitioners - so far as perusal of the said status reports by this Court, is concerned.
What the Status Reports in the Common Cause PIL say - HELD THAT:- There is a final status report in relation to the First PE dated 29.08.2014 placed on record. This final status report also narrates the findings of the preliminary enquiry premised on the complaint made by Mr. Prashant Bhushan, Advocate against the petitioner no.1 herein, which was also included within the ambit of the First PE. This status report also records that the Manager - Accounts of M/s IIL admitted to have made entries in the excel sheets on the instructions of Director, Corporate Affairs and ED, Finance of M/s IIL and other persons as recorded against the entries. However, the same had been denied by the mentioned individuals - the status reports filed by the CBI during the proceedings of the common cause PIL are no different from the factual narration contained in the Second PE. During the course of the First PE, the complaint of Mr. Prashant Bhushan, Advocate – followed by the common cause PIL, surfaced. Both of them sought to link the disclosure of the abbreviation “VBS” in the Excel Sheets recovered by the Income-Tax authorities during raid on the premises of M/s IIL with the petitioner no.1, and also contained other allegations to suggest the trail of the money, allegedly received by petitioner no.1 herein from M/s IIL, to the purchase/ acquisition of LIC policies in the names of the petitioners and their family members by showing the source of the funds as horticultural income.
The submission with regard to lack of territorial jurisdiction of the learned Special Judge to deal with the regular case registered at Delhi is concerned, the same has no merit at all. This is for the reason that, firstly, the check period relates to the service rendered to petitioner No.1 at Delhi as a Union Minister i.e. when the offence was allegedly committed. The allegation against the petitioner No.1 is that he was possessed of assets disproportionate to his known sources of income while serving as a Union Minister during the check period at Delhi. Secondly, one of the known sources of income – which is an essential ingredient of the offence under Section 13(2) read with Section 13(1)(e) of the PC Act, was undisputedly at Delhi, since the petitioner No.1 drew his salary as a Union Minister during the check period at Delhi.
The issue is not whether the FIR/RC in the case could have been registered within the jurisdiction of the Special Judge in Himachal Pradesh. The issue under examination is, whether the same has, in fact, been registered within the jurisdiction of the competent Special Judge. An accused cannot dictate to the prosecution that the case should be registered at a police station that he desires. The case may be registered at any one of the police stations within whose jurisdiction the same can be legally instituted.
The present is not a writ petition preferred by the State of Himachal Pradesh. The State of Himachal Pradesh cannot seek to advance submissions which have not even been raised by the petitioners. This Court is not obliged to deal with them, since the contesting respondent i.e. the CBI has not been called upon to meet the submissions of the State of Himachal Pradesh. Even otherwise, the present is not a petition raising a Centre-State dispute, which can be adjudicated only by the Supreme Court under Article 131 of the Constitution.
Petition dismissed.
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2017 (3) TMI 1885 - RAJASTHAN HIGH COURT
Penalty levied u/s 271(1)(c) - additions were confirmed in the quantum appeal - bogus purchases - HELD THAT:- As the expenses or the credits which were shown by the creditors cannot be proved, therefore, no substantial tax is paid. Therefore, in that view of the matter, on the basis of the observations made in Aiyub Umarji Patel [2013 (2) TMI 738 - GUJARAT HIGH COURT] and Oasis Hospitalities (P) Ltd. [2011 (1) TMI 194 - DELHI HIGH COURT] in our view, the issue is required to be answered in favour of the assessee and against the department.
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2017 (3) TMI 1884 - ITAT KOLKATA
Addition under the head paid up capital of 117 companies - search u/s. 132(1) - block assessment - AO has added the entire paid up capital of the 117 companies of the assessment order for the block period on the ground that the assessee could not state the exact paid up capital nor could he explain the source of the capital in the said companies to his satisfaction - CIT-A deleted the addition - HELD THAT:- We concur with the view of the Ld. CIT(A) for deleting the addition made on this account because all the companies are separate legal entities and have been assessed separately and that the accounts of these companies are statutorily audited and moreover they have disclosed their paid up capital in their respective Balance Sheets every year and, therefore, cannot be termed as undisclosed income.
Without bringing any evidence to show that the companies which are legal entities and assessed to tax every ear, have not disclosed the paid up capital or less paid up capital, the amount of paid up capital which have been disclosed in its balance sheet every year, ought not to have been fastened in the hands of the assessee. AO failed to bring on record that the entire amount of paid up capital as shown by the companies originated from the assessee’s coffers and without making any enquiry from the said companies as to their respective paid up capitals and who were the share holders and without bringing any evidence on record to suggest that the paid up capital of those companies were funded only by the assessee, the AO ought not to have made the addition without any basis the addition made cannot be sustained. Therefore, we do not find any infirmity in the order passed by the Ld. CIT(A) and the same is hereby upheld. This ground of appeal of revenue is dismissed.
Addition under the head income from undisclosed source - HELD THAT:- As the credit entries in the books were related to AY 1995-96 to 1996-97, which have been assessed in the regular assessment, so assessee cannot be taxed again during the block assessment as held by Hon’ble jurisdictional High Court in Caltradeco Steel Sales (P) Ltd. [1999 (8) TMI 18 - CALCUTTA HIGH COURT] - DR at the time of hearing before us could not point out any infirmity in the order passed by the ld. CIT(A) so as to warrant our interference and, therefore, we are inclined to uphold the order of the Ld. CIT(A) and dismiss this ground of appeal of the revenue.
Unexplained deposits - loose sheets of the blank cheques signed by the account holders found that the assessee had been indulging in name lending business - HELD THAT:- The cash deposited in the proprietary concern does not belong to the assessee but belongs to the beneficiaries listed as annexure – II to the assessment order. Therefore, the addition made by the AO is not on the basis of evidence or material to even remotely suggest that cash deposited in bank account belongs to assessee and the impugned addition is totally contradictory to the findings recorded at various places in the assessment order and the Ld. CIT(A) erred in not appreciating the aforesaid findings of the AO and has simply relied on a portion of the statement recorded which has been subsequently retracted by the assessee, cannot be the basis of confirmation of addition which has no legs to stand and, therefore, we are inclined to delete the addition.
Advancing loans to the beneficiary companies - assessee had made a statement before the authorities below during the course of search which has definitely got evidentiary value - HELD THAT:- We note that the AO himself has clearly made a finding that the assessee is not a man of means and he has also accepted the fact that he is only in the name lending and providing accommodation entry for a small commission. The illustration given by the AO is based on the material seized from the search and the modus operandi has been clearly spelled out by the AO, that is the basis on which the AO went ahead to add the income on protective basis and took steps to tax the beneficiaries listed out at Annexure-II to the assessment order. It has been brought to our notice that in the case of the beneficiary, that is M/s Trinetra Commerce & Trade Pvt. Ltd., the addition on substantive basis was upheld by the Hon’ble Calcutta high Court in [2016 (10) TMI 974 - CALCUTTA HIGH COURT]. So, therefore, the addition based on statement alone which has been recorded when he was mentally disturbed cannot be sustained. In the light of the facts and circumstances of the case, the AO’s order relying only on the statement of the assessee to fasten the liability on the assessee is unsustainable and, therefore, we are inclined to delete the addition made on this ground.
Assessee has returned huge income pursuant to the notice u/s. 158BC - addition on protective basis - HELD THAT:- we note that the AO himself finds that the assessee is a man of no means and was of the considered opinion that crores of rupees cannot belong to the assessee. Therefore, in the peculiar facts and circumstances of the case, merely became the assessee returned ₹ 7.10 cr. as income in a disturbed mental condition cannot be the bed-rock on which the assessment of income of the assessee can be made. In the peculiar facts and circumstances of the case, we set aside the addition of ₹ 7.10 cr. and in the interest of justice, this issue is restored back to the file of the AO to examine the seized material and then recompute the income of the assessee for the block period. The AO shall correlate the material seized based on which the AO shall arrive at the correct taxable income of the assessee for the block period.
Appeal of the assessee is partly allowed for statistical purposes.
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2017 (3) TMI 1883 - PUNJAB AND HARYANA HIGH COURT
Power to proceed against other persons appearing to be guilty of offence - Summon of complainant as an accused person - deposition of the defence witnesses before the trial Court during trial when the basic ingredients of Section 319 Cr. P.C. is that such a proposed accused is required to be tried together with the accused already on trial - Section 319 of Code of Criminal Procedure, 1973 - HELD THAT:- It is clear from the reading of Section 319 that the person sought to be summoned under Section 319 Cr. P.C. should be the person who could be tried along with already arraigned accused.
Looking at the back at the case at hand, the petitioner- Ravinder Singh who is the complainant, it is absolutely clear that he cannot be tried along with already arraigned accused. The case could not fall within the parameters of Section 319 Cr. P.C.
Petition allowed.
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2017 (3) TMI 1882 - ITAT KOLKATA
Revision u/s 263 by CIT - period of limitation - addition on account of receipt of share capital - Reopening of assessment u/s 147 initiated - HELD THAT:- It is relevant to mention that we have disposed of more than 500 cases involving same issue through certain orders with the main order having been passed in a group of cases led by Subhlakshmi Vanijya Pvt. Ltd. [2015 (8) TMI 174 - ITAT KOLKATA] as held the notices u/s 263 were properly served through affixture or otherwise. Further the law does not require the service of notice u/s 263 strictly as per the terms of section 282 of the Act. The only requirement enshrined in the provision is to give an opportunity of hearing to the assessee, which has been complied with in all such cases.
Limitation period for passing order is to be counted from the date of passing the order u/s 147 read with sec. 143(3) and not the date of Intimation issued u/s 143(1) of the Act, which is not an order for the purposes of section 263. In all the cases, the orders have been passed within the time limit.
CIT having jurisdiction over the AO who passed order u/s 147 read with section 143(3), has the territorial jurisdiction to pass the order u/s 263 and not other CIT.Addition in the hands of a company can be made u/s 68 in its first year of incorporation.
After amalgamation, no order can be passed u/s 263 in the name of the amalgamating company. But, where the intention of the assessee is to defraud the Revenue by either filing returns, after amalgamation, in the old name or otherwise, then the order passed in the old name is valid.
Order passed u/s 263 on a non-working day does not become invalid, when the proceedings involving the participation of the assessee were completed on an earlier working day.
Order u/s 263 cannot be declared as a nullity for the notice having not been signed by the CIT, when opportunity of hearing was otherwise given by the CIT.
Refusal by the Revenue to accept the written submissions of the assessee sent after the conclusion of hearing cannot render the order void ab initio. At any rate, it is an irregularity. Search proceedings do not debar the CIT from revising order u/s passed u/s 147 of the Act. - Decided against assessee.
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2017 (3) TMI 1881 - ITAT KOLKATA
Reopening of assessment u/s 147 - Addition towards capital gains u/s 45(3) - profit accrued to assessee company on transfer/contribution of capital by way of contribution in the form of its share of ‘land asset’ to the ‘partnership firm’ - HELD THAT:- As rightly pointed out that even assuming that income accrued and arose in the hands of the firm consequent to revaluation of the assets by the firm, the income that might accrue in the hands of the partner would be in the nature of “share income from the firm”. In terms of Sec.10(2A) of the Act, partner’s share in the total income of the firm is not to be included in the total income of the partner. Therefore, looked at from any angle, the AO could not on the basis of the reasons recorded formed belief that income chargeable to tax in the hands of the Assessee has escaped assessment. Considering the factual position, we are of the view that ld CIT (A) has rightly deleted the addition therefore we confirm the order of ld CIT (A). - Decided in favour of assessee.
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2017 (3) TMI 1880 - ITAT INDORE
Short deduction of TDS and interest on short deduction - assessee has deducted TDS @ 10% on deposits instead @20% due to clerical mistake - HELD THAT:- As decided in M/S. HINDUSTAN COCA COLA BEVERAGE PVT. LTD VERSUS COMMISSIONER OF INCOME TAX [2007 (8) TMI 12 - SUPREME COURT] when the tax has been paid by the deductee-assessee, the tax could not be recovered once again from the assessee. It is the claim of the assessee society that the deductee has paid the taxes , hence, the assessee is not liable to be for demand on account of short deduction of TDS. However, this claim is not fully verified by the lower authorities. Therefore, in the interest of justice and fair play, this issue is restored back to the file of AO with the direction that the AO shall verify whether the short deduction on account of low rate of TDS has been paid by the payee / deductee/ recipient and they have shown the receipt in the their return of income. If that be so , no demand on account of short deduction can be claimed from the assessee.
All these facts require verification at the end of AO. The assessee is also directed to cooperate with the AO and must produce all the relevant evidences before the AO. The AO is further directed to verify the same and decide the matter afresh keeping in mind the decision of Hon'ble Supreme Court cited supra and CBDT Circular F. No. 275/201/95-IT(B) dtd. 29.01.1997. Accordingly, all the grounds of appeal are allowed for statistical purposes.
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2017 (3) TMI 1879 - ITAT KOLKATA
Reopening of assessment u/s 147 - whether the credit to the current account of the Assessee in the partnership firm M/S. Salarpuria Soft Zone of a sum gives raise to any income chargeable to tax? - HELD THAT:- Reopening the assessment u/s 147/148 was without any tangible material therefore the said reopening of the assessment u/s 147/148 was bad in law, as rightly held in M/S. ORCHID GRIHA NIRMAN PVT. LTD. [2016 (11) TMI 247 - ITAT KOLKATA].
As rightly pointed out that even assuming that income accrued and arose in the hands of the firm consequent to revaluation of the assets by the firm, the income that might accrue in the hands of the partner would be in the nature of “share income from the firm”. In terms of Sec.10(2A) of the Act, partner’s share in the total income of the firm is not to be included in the total income of the partner. Therefore, looked at from any angle, the AO could not on the basis of the reasons recorded formed belief that income chargeable to tax in the hands of the Assessee has escaped assessment. Considering the factual position, we are of the view that ld CIT (A) has rightly deleted the addition therefore we confirm the order of ld CIT (A).- Decided against revenue.
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2017 (3) TMI 1878 - MADRAS HIGH COURT
Exemption u/s 54F - Refusal to issue No Objection Certificate for enabling the petitioner / assessee to withdraw amount from Capital Gains Accounts - HELD THAT:- Admittedly, there are eight accounts with the maturity value as tabulated above.
It is also not in dispute that the tax liability under dispute would cover the total amount in deposit, in respect of three account numbers in serial Nos. 3, 4 and 7 of the above referred accounts. Considering the fact that the petitioner has come forward with a request only in respect of other five accounts and willing to go before the respondent for considering the matter afresh in respect of those three accounts
The interest of the Revenue will not be prejudiced in any manner, if the respondent is directed to issue "No Objection Certificate" in respect of remaining five the petitioner is protecting the interest of the Revenue by not getting the "No Objection Certificate", for the present, in respect of the other three Accounts are concerned pending a decision to be made afresh by the respondent, after hearing the petitioner.
WP allowed in part.
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2017 (3) TMI 1877 - RAJASTHAN HIGH COURT
Preventive detention of the petitioner - whether the respondents by not placing the grounds of detention before Advisory Board within three weeks of petitioner's detention have violated provisions of Section 11 of the Act of 2006? - HELD THAT:- Requirement of Section 11 of the Act of 2006 in placing the matter before the Advisory Board thus stood complied with. In the present case, the petitioner was detained on 01.08.2016; meeting of the Advisory Board was convened on 29.08.2016 and the report of the Advisory Report dated 03.09.2016 was received by State Government on 06.09.2016. Further requirement of Section 12 of the Act of 2006 according to which the Advisory Board has to submit its report within 50 days from the date of detention of the detenu was also complied with - It is, thus clear that not only matter of the petitioner was placed before the Advisory Board within requisite period of three weeks, but report was also submitted by the Advisory Board to the State Government much before expiry of 50 days from the date of detention of the petitioner. Argument of learned counsel the petitioner in this behalf is rejected.
Whether consideration of the case of the petitioner by the Advisory Board was vitiated by reason of rejection of representation by the State Government rather than forwarding the same with its comments to the Advisory Board? - HELD THAT:- Section 3(3) of the Act of 2006 inter alia provides that when any order is made under this section by an authorised officer, he shall forthwith report the fact to the State Government together with the grounds on which the order has been made and such other particulars as, in his opinion, have a bearing on the matter, and no such order shall remain in force for more than twelve days after the making thereof, unless, in the meantime, it has been approved by the State Government. The order made by the authorised officer as referred to sub-section (3) of Section 3 of the Act of 2006 refers to an order of initial detention made by the District Magistrate, but if after making of such order and placing the matter before the Advisory Board for its consideration, any representation is made by the detenu to the government authority/government and the matter is pending before the Advisory Board, the Government should necessarily forward such representation to the Advisory Board rather than rejecting it.
In the facts of the case, rejection of representation dated 22.08.2016 by the State Government vide order dated 26.08.2016 after it had forwarded the grounds of detention to the Advisory Board on 10.08.2016 and appraisal of the fact of rejection to the Advisory Board by the State Government must be held to have vitiated the proceedings of the Advisory Board as also subsequent confirmation of the detention by the State Government.
Present habeas corpus petition deserves to succeed and is accordingly allowed.
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2017 (3) TMI 1876 - ITAT KOLKATA
Exemption u/s 11 - rejecting the grant of registration u/s. 12AA as original trust deed was not produced and dissolution clause was not found in the copy of said deed - power to exercise in granting registration for a religious or charitable institution - Charitable object u/s 2(15) - HELD THAT:- As relying on Case of TARA EDUCATIONAL AND CHARITABLE TRUST VERSUS DIRECTOR OF INCOME TAX (EXEMPTIONS) [2014 (7) TMI 869 - ITAT MUMBAI] we set aside the impugned order of the CIT(E) in rejecting the grant of registration - Decided in favour of assessee.
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2017 (3) TMI 1875 - ITAT MUMBAI
Addition on account of suppressed sales calculated @ 30% of the disclosed receipts - HELD THAT:- We find that if a net profit ratio of the gross on money is estimated by the AO is taken then it will meet the end of justice to both sides. Various Benches of the Tribunal had taken the net profit rate between 5 to 12%.
Keeping in view of the ratios applied by various Benches of the Tribunals, we are of the view that if 8% net profit of the estimated on money is taken into consideration then it will meet the end of justice. Accordingly, we direct the AO to take 8% of the net profit of the gross on money estimated by him.
Addition treating the expense on account of project as not genuine - HELD THAT:- We do not find any infirmity in the findings of the ld CIT(A) for the reason that no evidence whatsoever has been filed in support of the claim of expenses. Therefore, we confirm the order of the ld CIT(A) in this respect.
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2017 (3) TMI 1874 - ORISSA HIGH COURT
Suit for declaration of 'B' schedule land - production of documents during the pendency of the suit - Order 16 Rule 6 C.P.C. - HELD THAT:- The provision contained in Order 16 Rule 6 of C.P.C. is not to penalize a party. The plaintiffs have filed the certified copy of the registered sale deed. They assert that the document was in possession of the vendee-Paremeswar Naik. He is dead. The document is in custody of their Advocate. The document would show some light into the case.
The petition is allowed.
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2017 (3) TMI 1873 - ITAT KOLKATA
Deduction u/s 80IB - Interest accrued on Fixed Deposits as income from business - assessee claimed deduction u/s. 80IB(10) of the Act towards the accrued interest on fixed deposits filed in the revised computation of income showing the said interest income as its business income - HELD THAT:- Admittedly, the assessee shown the said income as income from other sources in the original return. We find that the AO has allowed deduction under similar circumstances u/s.143(3) for the AY 2006-07 based on interest income. AR argued that only business Funds were utilised for making deposits, which fetched interest income. We find force in the submissions of the assessee that the net profit as per revenue account the assessee shown under the different heads i.e. income from house property, income from other sources and income from business. Financial statements are prepared after completing all the legal requirements. But, from the operational point of view all the income were disclosed under whatever sources are the integral parts of assessee’s business.
As relying on TIRUPATI WOOLLEN MILLS LIMITED [1991 (1) TMI 34 - CALCUTTA HIGH COURT] we hold that the interest earned on fixed deposits made out from accumulated profits and reserves is the income, which derived from assessee’s business activity. Therefore, the assessee is eligible to claim deduction u/s. 80IB(10) of the Act. Therefore, we find no infirmity in the order of the CIT-A and it is justified. - Decided against revenue.
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2017 (3) TMI 1872 - ITAT AHMEDABAD
Penalty u/s 271(1)(c) - addition on account of undisclosed long term capital gains - AO found that assessee had not shown long term capital gain according to provision of section 50C - HELD THAT:- On the analysis of the provisions of section 50C, we observed that section 50C is a deeming provision to tax the difference as capital gain where the consideration received as a result of transfer of capital assets, being land or building or both if less than the value adopted by the stamp valuation authority. It is only on account of deeming provisions of section 50C, the AO has made the addition after considering the valuation report of the valuation officer u/s 50C(2) of the act and determined the long term capital gain.
The fact remains that the actual amount received was offered for taxation. It is only on the basis of the deemed consideration that the proceedings under Section 271(1)(c) of the act has been started. The revenue has failed to produce any iota of evidence that the assessee actually received one paise more than the amount shown to have been received by him. We observed that in terms of deeming provisions of section 50C, higher sales consideration of property determined by the DVO did not by itself amount to furnishing inaccurate particulars of income so as to levy penalty under section 271(1)(c) of the act
The revenue has also not shown as to how the assessee could be held to have actually received this amount which is in excess of the amount of mentioned in the sale deed . It has also not been shown as to whether any corresponding addition has been made in the hands of the buyer. We further notice that the addition was made totally by invoking the provision contained in section 50C of the act, therefore, penalty cannot be imposed on the income determined on the basis of deeming provision of section 50C as this solitary does not lead to concealment of income or furnishing of inaccurate particulars of income - Decided in favour of assessee.
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2017 (3) TMI 1871 - ITAT MUMBAI
Depreciation on Plant & Machinery - depreciation claimed by the assessee on the basis of letter of approval - HELD THAT:- Since required certificate has been provided by the assessee which has been examined by the Ld. CIT(A), and only thereafter relief has been provided by him in line with earlier years’ orders which have been confirmed by the Tribunal. Ld. DR could not point out anything incorrect or wrong in the factual finding of the Ld. CIT(A). Under these circumstances, we do not find any justification to interfere in the order of the Ld. CIT(A) on this issue. Thus, ground 1 raised by the Revenue is hereby dismissed.
Claim made u/s.32(2AB) - assessee had furnished only a certificate received from the Chartered Accountant and certain correspondence with Ministry of Science and Technology to claim the weighted deduction u/s 35(2AB). He was of the opinion that the assessee has not fulfilled the necessary conditions laid down in clause (i) to (v) of the above section and since no evidences were brought before him to show that the assessee had entered into an agreement with the prescribed authority - HELD THAT:- During the course of hearing before us, Ld. Counsel stated that this issue is covered in favour of the assessee by the decisions of the Tribunal for earlier years. Though in the earlier years, this issue was sent back to the file of the AO for the limited purpose of verification of order of approval in form 3CM, but in the year under appeal, the said approval in form 3CM was filed before the lower authorities, and Ld.CIT(A) had granted relief after verifying the same. Therefore, no purpose would be served in sending the matter back to the file of lower authorities especially when nothing wrong has been pointed out in the findings of Ld. CIT(A).
DR did not make any serious objection to the proposition. Under these circumstances, we find that the relief has been granted by the Ld. CIT(A) after verifying the requisite approval in proper form. Nothing wrong or contradictory has been brought before us by the Ld. DR. Thus, we do not find any need or justification to interfere in the order of the Ld. CIT(A). Therefore, the order of the Ld. CIT(A) is upheld. Thus, ground of the Revenue is dismissed.
Disallowance u/s.36(1)(iii) - since the assessee failed to discharge the onus and did not satisfactorily demonstrate that only interest free funds were advanced as loans to sister concern, the AO disallowed proportionate interest @12% on the interest free loans advanced - HELD THAT:- Issue decided in favour of assessee on detailed submissions were made by the assessee wherein it was inter-alia submitted that the assessee had sufficient funds to give these loans and in any case, these amounts were given for the purpose of business of the assessee.
Nature of expenditure - addition on computer software - AO had found that the assessee had purchased MS Window and held that being a new software,the expenditure was to be capitalised - allowed depreciation of ₹ 9000/-(@30%) by making addition - HELD THAT:- Software packages like MS Window 2008 were utility packages,that they were for regular business use, that such programmes help the assessee to carry-out the business more efficiently and did not enhance the value of profit making apparatus.Finally,deleting the addition made by the AO he held that the expenditure incurred by the assessee for purchasing software should be treated as revenue expenditure. Before us, the DR stated that the matter could be decided on merits. The AR relied upon the judgment of Asahi India Safety Glass Ltd. [2011 (11) TMI 2 - DELHI HIGH COURT] - We find that the issue stands covered by the above order of the Hon’ble Delhi High Court.
Insurance claim - HELD THAT:- We find that there was fire in the factory premises of Avinash Drugs Ltd. in AY 2005-06, that it made a claim before insurance company with regard to damage caused by fire, that during the AY.2009-10 Avinash Drugs Ltd. merged with the assessee,that it received insurance claim about damage to Plant &Machinery and its vehicle.As the money received by the assessee was against the capital asset, therefore, same has to be treated in the nature of capital receipt.In our opinion, assessee had rightly reduced the said sum while computing the income for the year under consideration. As there is no legal or factual infirmity in the order of the FAA,so confirming the same, we dismiss last Ground of appeal,raised by the AO.
Disallowance u/s 14A r.w.r.8D - HELD THAT:- We direct the AO to delete the disallowance on account of interest and follow the direction of the Tribunal with regard to other disallowance.(0.5% disallwoance).First Ground of appeal is decided in favour of the assessee,in part.
Disallowance of foreign exchange fluctuation - HELD THAT:- We find that the assessee had availed foreign currency term loan from SBI and a loan by way of ECB,that it had claimed the loss arising on account of fluctuation in foreign exchange borrowings as revenue expenditure, that the FAA,while confirming the order of the AO,held that the loss claimed by the assessee was not revenue loss,but was capital loss.The issue of revenue/capital loss has been subject of extensive litigation.
It is a fact that the loan from the SBI and the ECB was availed by the assessee for purchasing capital assets and the loss arising out of the fluctuation in foreign exchange was not relatable to circulating capital or stock in trade of the assessee.It is not the case of the assessee that borrowed amount for the purpose of import of capital goods was utilised for other purposes or that the loan amount had undergone a change and had assumed a new character.It was a plain and simple transaction of purchasing the capital goods,so any loss related with it has to be considered as capital loss.It is also found that the AO had allowed depreciation on the assets - In the case before us,the FAA has not held that the liability was contigent.He has given a categorical finding of fact of purchase of machinery i.e.capital asset. - Decided against assessee.
Disallowance of additional depreciation u/s.32(1)(iia) - HELD THAT:- We find that the issue stands covered in favour of the assessee by the judgment delivered by the Hon’ble Karnataka High Court in the case of Rittal India Pvt.Ltd.[2015 (1) TMI 1248 - KARNATAKA HIGH COURT] as held Additional depreciation allowable under section 32(1)(iia) of the Income-tax Act, 1961is a one-time benefit to encourage industrialisation and the relevant provisions have to be construed reasonably and purposively. The additional depreciation is allowed in the year of purchase and if in the year of purchase the assessee is eligible only for 50 per cent. depreciation, the balance 50 per cent. can be carried forward for the subsequent year.
Disallowance u/s.40a(ia) - Prior period expenses - HELD THAT:- We find that the AO or the FAA has not doubted the genuineness of incurring of expenditure, that the assessee had on its own disallowed the expenses in question in AY.2010-11,that taxes were deducted and paid before the due date i.e.the due date of filing of return of income as per the provisions of section 139(1)of the Act.Considering the peculiar circumstances and facts of the case,we direct the AO the allow the expenditure during the year under appeal. GOA-7 is decided in favour of the assessee.
Wrong entry passed by Amarjyot Chemicals Limited (ACL) - HELD THAT:- Before us,the AR stated that the assessee had not made any claim for credit, that the AO should be directed to verify the claim. The DR left the issue to the discretion of the Bench. After considering the available material,we are of the opinion that matter should be restored back to the file of AO for further verification.He is directed to afford a reasonable opportunity to the assessee and decide the issue afresh.Ground No.8 is decided in favour of the assessee,in part.
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2017 (3) TMI 1870 - ITAT KOLKATA
Nature of expenses - expenses paid by the assessee as NPV to enable the assessee to carry on its mining business - whether or not the payment of NPV made by the assessee to carry on its mining activities on forest land is allowable as revenue expenditure? - HELD THAT:- As rightly pointed out that the assessee by making payment of NPV got no fresh right to mining but the said payment was made to overcome restriction or obstruction or disability that had arisen in continuing of the mining business. Merely because it was one-time payment, it could not be considered as capital in nature. Besides, the said issue is covered by assessee`s own case in [2014 (1) TMI 1515 - ITAT KOLKATA] wherein the Tribunal treated the said expenditure as revenue in nature.
Therefore, we hold that ld. CIT(Appeals) has rightly held that the above expenditure paid by the assessee as NPV to enable the assessee to carry on its mining business is revenue in nature, which is allowable as business expenditure under section 37(1) - Decided against revenue.
Delayed payment of employee`s contribution to PF - As per revenue CIT (A) erred in relying on the provisions of section 43B (b) of the I.T.Act, whereas the present issue is involved with Section 36(1) (va) read with 2 (24) (x) - HELD THAT:- We are of the view that there is merit in the submissions of ld. AR for the assessee, as the proposition canvassed by ld. AR for the assessee are supported by the facts narrated by him above. Ld. AR for the assessee has rightly pointed out that as per Tax audit report column No.16(b) Annexure-B, which clarified that employees` contribution to PF ₹ 2,30,271/- for January 2011 was paid on 23.02.2011, that is, next Month. Therefore, the assessee did not commit and default in depositing the PF contribution even as per section 36(1) (va) r.w.s 2(24) (x) of the I.T.Act. Considering the factual position, we do not find any infirmity in the order passed by the ld CIT(A). Therefore, we confirm the order passed by ld.CIT(A). - Decided against revenue.
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2017 (3) TMI 1869 - ITAT AHMEDABAD
Levy of fee u/s. 234E - appellant has filed TDS statement u/s. 200(3) beyond the prescribed due date - whether the late filing fee of TDS return u/s.234-E can be levied prior to 01/06/2015? - HELD THAT:- As decided in PERFECT CROPSCIENCE PVT. LTD. VERSUS DY. COMMISSIONER OF INCOME-TAX [2016 (1) TMI 1271 - ITAT AHMEDABAD] issue is whether such a levy could be effected in the course of intimation under section 200A. The answer is clearly in negative. No other provision enabling a demand in respect of this levy has been pointed out to us and it is thus an admitted position that in the absence of the enabling provision under section 200A, no such levy could be effected. As intimation under section 200A, raising a demand or directing a refund to the tax deductor, can only be passed within one year from the end of the financial year within which the related TDS statement is filed, and as the related TDS statement was filed on 19th February 2014, such a levy could only have been made at best within 31st March 2015. That time has already elapsed and the defect is thus not curable even at this stage. In view of these discussions, as also bearing in mind entirety of the case, the impugned levy of fees under section 234 E is unsustainable in law. We, therefore, uphold the grievance of the assessee and delete the impugned levy of fee under section 234E.
When the above judicial precedent was brought to the notice of the ld. Departmental Representative, he did not have much to say except to place his reliance on the orders of the authorities below. He fairly did not dispute that the provisions accepting levy of late filing fees under section 234E have indeed been brought to the statute w.e.f. 1st June, 2015 and the impugned order was passed much before that date.
In view of the above discussions and bearing in mind entirety of the case, we hereby delete the levy of late filing fees under section 234E of the Act by way of impugned intimation issued - Decided in favour of assessee.
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2017 (3) TMI 1868 - ITAT KOLKATA
Exemption u/s 11 - grant of registration u/s.12AA of the Act and application in form No.10G u/s.80G(5)(VI) rejected - proof of Charitable activity u/s 2(15) - HELD THAT:- There is merit in the submissions of the assessee, as the proposition canvassed by assessee are supported by the facts narrated in the context of the provisions of Section 2(15) of the I.T.Act. Section 2(15) of the Act clearly defines the charitable purpose which, includes medical relief and in order to obtain the object of medical relief the assessee trust is running poly-clinic, pathology, x-ray and medical services. We are of the view that the trust activities are within the framework of Section 2(15) of the I.T.Act, 1961. Therefore, we cancel the order passed by the CIT(E) u/s.12AA and u/s.80G(5)(VI) of the I.T Act . - Decided in favour of assessee.
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2017 (3) TMI 1867 - NATIONAL COMPANY LAW TRIBUNAL, PRINCIPAL BENCH, NEW DELHI
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - Time Limitation - HELD THAT:- In order to ascertain as to whether there is a default in making payment of the operational debt, the tribunal is required to examine that the claim made before it ¡s within time. In case of revenue recovery the limitation period is three years from the date on which the debt has fallen due or the claim has arisen. Law of limitation has to be applied with all its rigour and tribunal has no power to extend the period of limitation. A live claim after lapse of limitation period becomes a stale claim unenforceable in law. Accordingly it is to be seen whether the tribunal has been moved within the maximum period of three years prescribed under the indian Limitation Act, 1963 from the date on which the debt has fallen due or the claim has arisen.
Admittedly the present claim arises in respect of supplies made by the petitioner to the respondent company during the year 2011-12 through various sales invoices all dated 30th March, 2011. Almost long six years have since passed. There is also no dispute that last part payment against the said supplies was made by respondent company on 29.08.2012 and there after it has stopped making any payment to the petitioner. The present application has been filed on 15.02.2017 much after the limitation period of three years.
‘Debt’ has been defined in the Insolvency and Bankruptcy Code, 2016 as a liability or obligation in respect of a claim which is due and includes a financial debt and operational debt. “Default” has been defined in the Code as non-payment of debt which has become due and payable. (Emphasis given) A debt which is not recoverable for any valid reason ceases to be an amount due and payable. Default arises for non-payment of an amount which could be recovered in law. Default is the event on the occurrence of which, the insolvency proceedings may be initiated under the Code - Claims which are time barred are not amount due and under law. Creditors have no right to recover claims of such due that become time barred. The debt in question has become more than three years old and was, therefore, not enforceable from respondent company in view of the law of limitation. Consequently in the present case, there has been no default for initiation of insolvency proceedings.
In the absence of default, the application filed by M/s Prowess International Private limited to initiate corporate insolvency resolution process under Section 9 of the Insolvency and Bankruptcy Code, 2016 against M/s Action Ispat and Power Private Limited, is rejected.
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