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Showing 61 to 80 of 1481 Records
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2022 (6) TMI 1421 - CALCUTTA HIGH COURT
Revision u/s 263 - second round of litigation - non-service of notice as agitated in first round of litigation - HC earlier [2018 (5) TMI 701 - CALCUTTA HIGH COURT] allowed the appeal on the ground that the contention advanced by the assessee with regard to non-service of notice was not specifically considered by the tribunal and order passed by the tribunal was set aside and the matter was remanded to the tribunal to re-consider the issue - HELD THAT:- On remand, the tribunal has taken up the matter and we find that factual exercise had been done by the tribunal and all the records placed by the department were considered and the tribunal was satisfied that there has been gross violation of principles of natural justice. Accordingly, the appeal filed by the assessee was allowed.
The revenue has challenged this order by filing the present appeal and from the memorandum of grounds, we find that the revenue seeks to convert this Court as if it is a second appellate Court over the findings of the tribunal. The present appeal, being one under Section 260A of the Act, what is required to be seen is as to whether any substantial question of law arises for consideration and the jurisdiction of this Court is not to reappreciate the factual conclusion arrived at by the tribunal. As pointed out earlier, the tribunal, after the matter was remanded, has done an elaborate factual exercise and decided in favour of the assessee. Thus, we find that there is no question of law much less substantial question of law arises for consideration in this appeal. Decided against revenue.
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2022 (6) TMI 1420 - MADRAS HIGH COURT
Maintainability of writ petition under Article 226 of the Constitution - Seeking forbearance from investigating under PMLA on the premise that the investigation is without jurisdiction - round tripping transactions between the Indian and the overseas entities - HELD THAT:- The jurisdiction of this Court under Article 226 of the Constitution is a basic feature of the Constitution of India and cannot be taken away even by a constitutional amendment - In that view of the matter, it cannot be contended, with any degree of seriousness, that a High Court does not possess the inherent jurisdiction to issue a writ in an appropriate case. It is also well settled that the High Court can issue a writ of mandamus to stop an investigation where it is found that the investigating officer was misusing his powers of investigation.
Nevertheless, the existence of jurisdiction is one aspect, and the manner of its exercise is quite another. The power of a High Court to issue high prerogative writs like a mandamus, certiorari, etc., flows from its plenary power under Article 226 of the Constitution of India and is discretionary in nature. Therefore, it does not imply that because the High Court is vested with jurisdiction to issue an appropriate writ, it must necessarily follow that a writ must issue in all cases. The remedy is discretionary in nature and must be exercised in consonance with sound judicial principles.
On perusing the order in MANOHAR LAL SHARMA VERSUS THE PRINCIPAL SECRETARY & OTHERS [2014 (7) TMI 1380 - SUPREME COURT] passed by the Supreme Court. What is discernable is that the CBI is conducting a Courtmonitored investigation into the coal block allocations, by issuing various directions from time to time. The Court had taken note of the fact that a Special Judge had been notified by the Chief Justice of the Delhi High Court to try the coal block allocation cases.
It is noticed that the CBI and the Enforcement Directorate have been periodically filing detailed status reports of the various prosecutions conducted by them.
Coming to the allegation of “round tripping” which was strenuously pursued by the learned Additional Solicitor General, it is necessary to briefly notice the import of this expression. “Round tripping” can be defined as a practice by which funds are transferred from one country to another and transferred back to the origin country for purposes like black money laundering or to get the benefit of tax concession/evasion/avoidance from countries like Mauritius, which enjoy low taxes, etc. - even according to the Enforcement Directorate, no mining was carried out and on the other hand, RKM Company had expended funds from its coffers on mine development activities. Once it is held that RKM Company had not derived any benefit from the allocation of the coal block, it follows that the corpus delicti of the offence viz., the proceeds of crime, does not exist.
The allegation of round-tripping, even assuming there is one, as alleged by the Enforcement Directorate, is a criminal activity, falling within the domain of Foreign Exchange Management Act (FEMA), there is no arrest provision under the provisions of FEMA, whereas, threat of arrest looms large in an investigation under the PML Act with bail conditions being very stringent.
The Enforcement Directorate cannot exercise its powers of investigation to discover the existence of a predicate offence under the FEMA or the Customs Act.
Thus, in the absence of there being any predicate offence under the Customs Act, 1962, for the present, and the fact that the alleged offence under the FEMA, 1999, is not a predicate offence under the PML Act, 2002, it follows that there cannot be any offence of money laundering under Section 3 of the PML Act, 2002 qua these offences.
A writ of mandamus is issued restraining the Enforcement Directorate from exercising its powers under the PML Act, 2002, qua the investigation of alleged money-laundering in respect of these offences alone - Petition disposed off.
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2022 (6) TMI 1419 - KARNATAKA HIGH COURT
Accrual of income - reliance on documents seized in search - as contented documents seized during the course of search and seizure proceedings and marked as A/1/MKP from the assessee reflected the amount collected on behalf of the co-operative societies and the said amount is not an income in the hands of the assessee.
HELD THAT:- To a pointed question of this Court, with regard to the above finding recorded by this Court, Shri Seshachala, in his usual fairness, did not deny that the judgment in [2016 (6) TMI 644 - KARNATAKA HIGH COURT] and connected case, has attained finality. In view of the admitted facts, the Assessing Officer, the First Appellate Authority and ITAT having concurrently recorded findings of the fact against the assessee, the question of law framed in this appeal are answered in favour of the revenue and this appeal is dismissed.
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2022 (6) TMI 1418 - ITAT CUTTACK
Penalty u/s. 271B - Delay in submitting the audit report - HELD THAT:- AO shows that the delay in submitting the audit report was on account of delay in obtaining audit report from the statutory auditors. It is fairly admitted that the statutory auditors is appointed by the Registrar of Co-operative Societies and not by the assessee.
Assessee has sufficient and reasonable cause for delay in obtaining the audit report. It is also an admitted fact that the audit report was available before the AO, when the assessment was done. This being so, we are of the view that it is a fit case for deletion of penalty u/s. 271B - As penalty levied by the AO u/s 271B of the Act and confirmed by the ld CIT(A) stands deleted. Decided in favour of assessee.
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2022 (6) TMI 1417 - NATIONAL FINANCIAL REPORTING AUTHORITY
Professional Misconduct - Compliance with SAs and Maintenance of Audit Quality - Promotion of Public and Investor confidence and Effectiveness in Deterring Auditors and Audit Firms from violating the applicable Accounting and Auditing Standards - sanctions and penalties.
Compliance with SAs and Maintenance of Audit Quality - HELD THAT:- CA Gulshan Jham is a qualified professional but the serious non-compliances of the Companies Act and Standards on Auditing on his part have been not what was expected from him as the Auditor. The primary function of the Auditor is to achieve the necessary audit quality and compliance with SAs. The charges proved have shown the failure of the CA to discharge this duty. A critical, questioning attitude, an unwillingness to be satisfied by merely superficial explanations, not concluding on material matters without rigorous verification from more than one angle, diligent and methodical cross verification, proper planning and the meticulous execution of the audit plan etc are fundamental to audit quality. The audit of this listed Company has been done by the CA most casually with no regard to the law, and professional and ethical standards. The CA has failed in his duties as the auditor.
Promotion of Public and Investor confidence and Effectiveness in Deterring Auditors and Audit Firms from violating the applicable Accounting and Auditing Standards - HELD THAT:- Audited financial statements are the basic inputs for innumerable transactions in the economy. A breakdown, or severe damage, to the trust and confidence that the public and investors have in financial statements, would have ramifications that go far beyond the limited activities of an auditee company. As professionals, auditors are expected to judge the significance of the operations of the entity they audit for the larger financial and economic sectors and accordingly calibrate their approach and procedures. The auditor's duty of exercising due diligence is owed to the users of the financial statements - Where the auditors have shown to be not diligent in considering these factors, appropriate penalties would follow that should be effective, proportionate and dissuasive. It is also essential that the penalty imposed has a suitable deterrent effect on other auditors and, at the same time, sends out a message to the Public and the Investor Community that such misconduct will not be allowed to escape lightly.
Nature and size of the Audit Firm - HELD THAT:- The CA in this case is a very small proprietorship firm not having any other listed company audit. Based on the principle of proportionality, the sanctions are being made keeping in mind the nature and size of the audit firm and the fact that he has accepted all the charges.
Penalties and Sanctions - HELD THAT:- Considering the fact that professional misconduct has been proved and considering the nature of violations and principles of proportionality, the NFRA, in the exercise of its powers under Section 132(4)(c) of the Companies Act, 2013 orders:
(i) Imposition of a monetary penalty of Rs. 100,000 (One Lakh only) upon CA Gulshan Jagdish Jham.
(ii) In addition, CA Gulshan Jadish Jham is debarred for one year from being appointed as an auditor or internal auditor or undertaking any audit in respect of financial statements or internal audit of the functions and activities of any company or body corporate.
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2022 (6) TMI 1416 - ITAT CUTTACK
Revision u/s 263 - anonymous donations receipts - as submitted there was a survey in the premises of the assessee on notice did not contain any query in regard to anonymous donations received by the assessee much less the donation - HELD THAT:- CIT (E) in his order u/s.263 of the Act had directed the AO to examine the donors and make proper enquiry and redo the assessment but the AO instead of doing the verification has practically rejected the assessee’s contention and has made addition representing 30% of the donations received treating the same as anonymous donations.
We are not going into the merits of the consequential order passed u/s.143(3) r.w. 263 r.w.s 144B - However, a perusal of the original assessment order clearly shows that no examination of the issues has been done. This being so, the ld CIT (E) is very much in his powers to direct the AO to examine the same. No error in the order of the ld CIT (E) has been pointed out by assessee. This being so, the order of ld CIT(E) passed u/s.263 stands upheld.
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2022 (6) TMI 1415 - KERALA HIGH COURT
Non-inclusion of GST amount in the tender - main contention against the impugned judgment is that Clause 3.3.3 of notice inviting tender is incorrectly and erroneously interpreted - HELD THAT:- In this intra court appeal the respondent/corporation demonstrates how the findings in the judgment are erroneous warranting an interference. The respondent/corporation is the maker of the tender conditions. Clause 3.3.3 in clear terms excludes GST component. Inviting the GST component while interpreting subsequent clauses is impermissible. Being the maker, in the event of arguable ambiguity, the benefit of ambiguity is extended not to the maker but the other party.
The learned single judge has judiciously used his discretion and allowed the writ petition declaring that the terms and conditions in Ext.P1 shall govern the contract and that respondents 2 and 3 have to pay the GST component against the bill raised by the petitioner. The decision cited by the counsel for the appellant only prohibits the writ court from interfering in any contractual matter and the interference in the auction procedure when the decision making process is arbitrary and for any extraneous consideration. In this case, the learned single judge has not gone into the complexities of the clauses in the notice inviting tender nor substituted any interpretation other than those explicitly provided in the clause.
The learned single judge was right in declaring that the GST component was not to be included as per clause 3.3.3 of Ext.P1 and the direction to pay the GST component by respondents 2 and 3 is in tune with the clauses of Ext.P1 and hence there are no grounds to interfere with the judgment of the learned single judge, and hence the writ appeal is dismissed.
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2022 (6) TMI 1414 - MADHYA PRADESHAT HIGH COURT
Condonation of delay filing return - petitioner was required to upload a Form 10B alongwith return whereas because of an error on the part of Chartered Accountant erroneously Form 10BB was uploaded - whether mistake committed by CA should not be treated as a bonafide mistake? - HELD THAT:- Even assuming that pursuant to certain communications filed with the return and the petition, the petitioner had an opportunity to avail alternative remedy, fact remains that application for condonation of delay was indeed maintainable. This is not a case of respondent that said application was not maintainable because petitioner did not avail the alternative remedy. The application for condonation of delay was also not dismissed on this ground and for this reason.
This is trite that validity of an order of statutory authority must be seen on the basis of grounds mentioned therein and not for any other reason.
A Constitution Bench of Supreme Court in the case of Mohinder Singh Gill and another Vs. The Chief Election Commissioner, New Delhi and others [1977 (12) TMI 138 - SUPREME COURT] opined that when validity of an order of the statutory authority is called in question, the validity of order needs to be examined on the basis of grounds mentioned therein. The orders cannot be validated on the basis of counter affidavit or supplementary counter affidavit.
The reasons assigned in the order dated 15/09/2020 alone is to be seen for the purpose of condonation of delay. We find substance in the argument of learned counsel for the petitioner that the delay or mistake is on the part of Chartered Accountant was not taken into account at all in the said order.
Thus, we deem it proper to set aside the impugned order and remit the matter back before the CIT (Exemption), Bhopal to reconsider and decide the matter afresh in accordance with law.
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2022 (6) TMI 1413 - ITAT INDORE
Addition u/s 69A r.w.s.115BBE - assessee has not been able to explain any source qua the excess-cash - HELD THAT:- The assessee was found to be owner of money i.e. excess cash, the excess cash was not recorded in the books of account of any source (i.e. books of business in present case) maintained by the assessee and the assessee has himself admitted that the excess cash found from his premise is earned from undisclosed sources, therefore he is unable to give explanation of its source. Thus, we find that all ingredients of section 69A are satisfied from the material held on record i.e. the statement of assessee. Being so we do not have iota of doubt in the application of section 69A.
The impugned excess cash found by the revenue during survey proceeding attracted section 69A as well as section 115BBE of the act. Therefore, we agree that the lower authorities have rightly invoked / confirmed that the excess cash is taxable u/s 69A read with section 115BBE. The conclusions taken by lower authorities do not require our interference. Decided against assessee.
Unexplained stock - physical stock was found to be short - AO treated this short-stock as unaccounted sales out of books of account, estimated profit @ 10% and thereby made an addition - HELD THAT:- We observe that the difference is very nominal and it can happen despite of all care in carrying out physical verification as well as preparation of books. We observe that the tax effect on Rs. 9,962/- shall be very negligible. Hence in order to impart a justice and taking a holistic and practical view, the addition deserves to be deleted. Decided in favour of assessee.
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2022 (6) TMI 1412 - ITAT DELHI
Belated payment of employees’ contribution to ESI and PF - assessee deposited the said contribution before due date for filing of return of income under Income Tax Act - Due date of payment - Scope of amendment - HELD THAT:- While processing the return u/s 143(1) of the Act no disallowance towards contribution to employees’ PF and ESI is warranted as this issue is highly debatable in nature. Even otherwise we find that the issue in appeals is squarely covered by the decision of the jurisdictional High Court in the case of CIT Vs. AIMIL Ltd. [2009 (12) TMI 38 - DELHI HIGH COURT] Ratio of this decision squarely applies to the facts of the assessee’s cases. Also see case of CIT Vs. M/s. Alom Extrusions Limited [2009 (11) TMI 27 - SUPREME COURT]
Hon’ble Supreme Court in the case of M.M. Aqua Technologies Ltd. [2021 (8) TMI 520 - SUPREME COURT] held that retrospective provision in a Tax Act which is for the removal of doubts cannot be presumed to be retrospective even where such language is used if it alters or changes the law as it earlier stood. The Amendments made to Section 36 and Section 43B by insertion of Explanations 2 and 5 respectively. In these Sections it is clarified that for the removal of doubts the provisions of these Sections were amended.
Tribunals in the cases of Raj Kumar [2022 (2) TMI 1224 - ITAT DELHI] held that the amendment brought in by Finance Act, 20 2021 is effective from 1.04.2021 and no disallowance is called for, on belated payment of employees’ contribution to ESI and PF in case the assessee deposited the said contribution before due date for filing of return of income under Income Tax Act
Thus we direct the Assessing Officer / CPC to delete the disallowance of employees’ contribution to EPF and ESI in all these cases as the contributions were remitted before the due date for filing of return of income. Grounds raised by the assessee are allowed.
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2022 (6) TMI 1411 - ITAT MUMBAI
Taxability of Consultancy Services as FTS - pre-requisites for deriving the benefit of the MFN clause in the Protocol to India’s DTAAs with certain countries - Issue decided in favour of assessee in its own earlier AY's - DR referring to CBDT Circular No.3/2022 has disputed the applicability of earlier orders of the Tribunal in the impugned assessment year - HELD THAT:- We find that in the case of GRI Renewal Industries SL [2022 (2) TMI 769 - ITAT PUNE] Tribunal considered the impact of CBDT Circular No.3/2022 held requirement contained in the CBDT circular No.03/2022 cannot primarily be applied to the period anterior to the date of its issuance as it is in the nature of an additional detrimental stipulation mandated for taking benefit conferred by the DTAA. It is a settled legal position that a piece of legislation which imposes a new obligation or attaches a new disability is considered prospective unless the legislative intent is clearly to give it a retrospective effect - it is ambiguously clear that there is no requirement of separate notification for importing the beneficial treatment from the agreement. Hence, in the facts of the case and the decision referred above, we find no merit in the arguments forwarded by the ld. Departmental Representative. The conditions set out in CBDT Circular 3/2022 would not apply in the impugned assessment year. Consequently, ground No.1 of the appeal is allowed.
Taxability of SAP Licence charges as royalty - HELD THAT:- We find that this issue is recurring. On identical set of facts, the Tribunal deleted the addition in preceding assessment years. The Tribunal in assessment year 2016-17 following the order in assessee’s own case in [2021 (1) TMI 323 - ITAT MUMBAI] deleted the addition as held receipt of software licence fees by the assessee, from its Indian subsidiary, is reimbursement of software licence fees paid by the assessee to a third party, and, therefore, it cannot constitute income taxable in the hands of the assessee. Decided in favour of assessee.
Taxability of IT Support Services as FTS/Royalty - HELD THAT:- The Tribunal in assessment year 2016-17 following the order of Co-ordinate Bench in assessment year 2015-16 deleted the addition as held the taxation under article 12 in the present case can come into play only when the "make available" clause is satisfied, but then the Assessing Officer's justification for the satisfaction of 'make available' clause, for the detailed reasons set out earlier in this paragraph, does not meet our judicial approval - we uphold the plea of the assessee on this point as well - income on account of Information Technology Services is also not taxable under article 12. Decided in favour of assessee.
Taxability of reimbursement expenses treated as FTS/royalty - HELD THAT:- Both sides are unanimous in stating that the DRP has not given any directions on this issue. DRP while considering objections of the assessee on Taxability of reimbursement of expenses as FTS/Royalty has dealt with the issue the directions. DRP has given finding without referring to the reimbursed expenses. Consequently, the issue raised allowed for statistical purpose.
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2022 (6) TMI 1410 - ITAT DELHI
Penalty u/s 271(1)(c) - unsecured loans received during the F.Y. 2003-04 - HELD THAT:- As decided in Manjunatha Cotton and Ginning Factory [2013 (7) TMI 620 - KARNATAKA HIGH COURT] held that notice under section 274 should specifically state the grounds mentioned in section 271(1)(c) i.e., whether it is for concealment of income or for furnishing of incorrect particulars of income. Sending printed form where all the grounds mentioned in section 271 are mentioned would not satisfy requirement of law.
In Mr. Mohd. Farhan A. Shaikh [2021 (3) TMI 608 - BOMBAY HIGH COURT] - Penalty-Concealment-Non-striking off of the irrelevant part while issuing notice u/s 271(1)(c) of the Income Tax Act, order is bad in law. Assessee must be informed of the ground of the penalty proceedings only through statutory notice. An omnibus notice suffers from the vice of vagueness.
In the case of PCIT vs. Sahara India Life Insurance Co. Ltd.[2019 (8) TMI 409 - DELHI HIGH COURT]reiterated that notice under section 274 should specifically state the grounds on which penalty was sought to be imposed as the assessee should know the grounds which he has to meet specifically.
The aforesaid principle has been reiterated in the in the case of CIT vs. SSA'S Emerald Meadows [2016 (8) TMI 1145 - SC ORDER]
Hence, respectfully following the order of the Hon’ble Jurisdictional High Court, the penalty levied is hereby obliterated.
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2022 (6) TMI 1409 - JAMMU AND KASHMIR AND LADAKH HIGH COURT
Seeking grant of Anticipatory Bail - FIR registered beyond the jurisdiction of this Court - whether this Court, in exercise of its powers under Section 438 of the Cr. P. C, is vested with jurisdiction to grant bail in a case that has been registered beyond its local limits of jurisdiction?
HELD THAT:- The above issue came up for consideration before this Court in the case of Mohan Singh Parihar vs. Commission of Police and Ors. [1982 (11) TMI 184 - JAMMU AND KASHMIR HIGH COURT]. This Court, after noticing the provisions contained in Section 497-A of the Jammu and Kashmir Cr. P. C, which is in pari materia with Section 438 of the Central Cr. P. C, as also the provisions contained in Section 6 of the J&K Cr. P. C, which is in pari materia with Section 6 of the Central Cr. P. C, observed that On the parity of the reasoning, the High Court and a Court of Session of which Section 497-A speak, must also mean the High Court and the Court of Session competent to try the accused seeking enlargement on bail.
On the basis of the aforequoted reasoning, the Court came to the conclusion that the High Court has no jurisdiction to grant anticipatory bail to a person against whom a case has been registered with a police station which is situated outside the local limits of its jurisdiction under the Code.
This Court does not have jurisdiction to entertain and decide the bail application which relates to an FIR that has been registered beyond the local limits of this Court even though the accused/petitioner may be residing within the jurisdiction of this Court - The petitioners in the instant case are not seeking transit bail but are seeking bail in anticipation of their arrest on a permanent basis, regarding which this Court lacks jurisdiction in view of the ratio laid down in the aforequoted judgment.
The petition is held to be not maintainable and the same is dismissed accordingly.
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2022 (6) TMI 1408 - AUTHORITY FOR ADVANCE RULINGS, CUSTOMS, MUMBAI
Classification of goods intended to be imported - vehicle-mounted computers - tablet computers - mobile computer - classifiable under heading 84.71 to be classified as ADP machines or not - HELD THAT:- These are portable devices used in enterprise environments to run mobile apps, capture barcodes, take photos and videos, and provide voice and data communications for workers and managers. These devices combine personal computer and scanning functions (applies to mobile computers and tablet computers) in a single device that can be outfitted with off-the-shelf or custom software applications that perform everyday tasks, such as monitoring deliveries, tracking assets, and managing inventory (except vehicle-mounted computer which do not have the capability of scanning). And because they run on familiar operating systems such as Windows/Android, they offer the same functionality of a desktop computer or laptop.
In respect of possible alternate heading 8517, there is a need to examine the features of these devices in the context of note 3 to section XVI of the tariff. Heading 8517 covers telephone sets, including smartphones and other telephones for cellular networks or for other wireless networks; other apparatus for the transmission or reception of voice, images or other data, including apparatus for communication in a wired or wireless network (such as a local or wide area network), other than transmission or reception apparatus of heading 84.43, 85.25, 85.27 or 85.28 - the tablet computers are classifiable under heading 8471 and not under heading 8517 despite the fact that the product is having cellular connection functionality, considering its principal function as automatic data processing. Similarly, in this case, the principal function of the impugned devices is barcode scanning and data processing for monitoring deliveries, tracking assets and managing inventory. Therefore, these devices appear to merit classification under heading 8471 and not under heading 8517.
Cellular connectivity is essentially used for GPS and information sharing, where wi-fi is not available. Cellular connectivity is also used for making calls. However, as mentioned earlier, 18 out of 32 models do not have cellular connectivity. On a similar device, the TC77 series touch computer, which is a handheld mobile computer used for asset inventory management purposes, Singapore Customs ruled (ref. No. CRL21 1217-0036) that the product is classifiable under subheading 84713090. Therefore, notwithstanding the WCO classification advice to the contrary, it is my considered opinion that the devices under consideration are not classifiable as smartphones. They merit classification under subheading 84713090.
Thus, the 32 devices are classifiable under heading 8471 and more specifically, under subheading 84713090 of the first schedule to the Customs Tariff Act, 1975.
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2022 (6) TMI 1407 - ITAT DELHI
Revision u/s 263 - No enquiry v/s inadequate enquiry - suspicious Share transactions - HELD THAT:- In present case AO had not only made sufficient enquiries, but after satisfying himself, assessment was framed u/s 143(3). After receiving information relating to share transfer proper enquiries were made which is also evident from the office note exhibited elsewhere.
It is a settled position of law that powers u/s 263 of the Act can be exercised by the Commissioner on satisfaction of twin conditions, i.e., the assessment order should be erroneous and prejudicial to the interest of the Revenue. By 'erroneous' is meant contrary to law. Thus, this power cannot be exercised unless the Commissioner is able to establish that the order of the AO is erroneous and prejudicial to the interest of the Revenue.
Thus, where there are two possible views and the AO has taken one of the possible views, no action to exercise powers of revision can arise, nor can revisional power be exercised for directing a fuller enquiry to find out if the view taken is erroneous.
This power of revision can be exercised only where no enquiry, as required under the law, is done. It is not open to enquire in case of inadequate inquiry.
Thus the order framed u/s 263 of the Act deserves to be set aside and that of the AO deserves to be restored. Decided in favour of assessee.
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2022 (6) TMI 1406 - CUSTOMS AUTHORITY FOR ADVANCE RULING, MUMBAI
Classification of goods proposed to be imported - data projectors Optoma X309ST, Optoma X319ST, Optoma W319ST, Optoma ZW350, Optoma ZX300 - classifiable under CTH 8528 69 00 or not - exemption to All goods of a kind solely or principally used in an automatic data processing system of heading 8471 - applicability of Sr. No. 17 of Notification No. 24/2005-Customs, dated 1-3-2005 - HELD THAT:- These are marketed as data projectors only. From the product catalogues and information available on the websites, it is clear that data projectors are principally meant for use with an automatic data processing system. They are designed to project in places like conference rooms, business meetings, financial institutions, tradeshows, exhibition venues etc. with connectors matching that of a laptop/computer. They possess both indoor and outdoor projection capability. The projectors proposed to be imported by the appellant have got additional features such as an S-Video port, HDM1 port etc. along with the capability to adjust the aspect ratio in 3 models. The additional ports give additional utility in the form of an audio-video display and the ability to adjust the aspect ratio to 16:9/16:10 is for adaptability purposes. The differentiating features of data projectors compared to that of video projectors are discussed in table 1, which substantiates that the principal use of impugned goods, based on functions and features, is with automatic data processing machines. The presence of additional features cannot disentitle the impugned goods from classification under sub-heading 8528 62 00.
Reliance is placed upon COMMISSIONER OF CUSTOMS (I), ACC, MUMBAI VERSUS VARDHAMAN TECHNOLOGY P LTD [2013 (8) TMI 271 - CESTAT MUMBAI], where it was held that the projectors merely having additional function cannot be denied classification under CTH 8528 61 00 (erstwhile tariff heading for projectors capable of directly connecting to and designed for use with an automatic data processing system of Heading 8471). Therefore, the goods under consideration are classifiable under sub-heading 8528 62 00.
Sr. No. 17 of Notification No. 24/2005-Customs, dated 1-3-2005, as amended, exempts all goods of a kind solely or principally used in an automatic data processing system of 8471 and falling under Heading 8528 62. As the impugned goods are held as classifiable under sub-heading 8528 62 00 and are principally used in/with automatic data processing system they are entitled to the exemption.
The projectors Optoma X309ST, Optoma X319ST, Optoma W319ST, Optoma ZW350 and Optoma ZX300 are classifiable under sub-heading 8528 62 00 of the First Schedule to the Customs Tariff Act, 1975 and would be eligible to avail benefit of Sr. No. 17 of Notification No. 24/2005-Customs, dated 1-3-2005, as amended.
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2022 (6) TMI 1405 - ITAT AHMEDABAD
Miscellaneous Application that the Ground No. 4 in the original appeal in respect to addition on account of production development expenses has not been addressed which admittedly needs consideration by us. Hence, the application is allowed.
Registry is directed to list the matter for hearing on 24.04.2022 solely for consideration of the Ground No. 4 raised for A.Y. 2014-15. Since both the parties were present before the court when the matter was heard and the date fixed for hearing, services the notice to the respective parties by the Registry is hereby dispensed with.
MA filed by the Revenue is allowed.
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2022 (6) TMI 1404 - ITAT MUMBAI
Assessment u/s 153A - Absence of any incriminating material during the course of search - addition u/s 68 - HELD THAT:- CIT(A) has referred purchase/work contract and purchase invoices along with the statement recorded u/s 132(4) holding that because of contrary statements of employees, nature of invoices constituent incriminating material and such facts were not existed at the time of original assessment made in the case of the assessee. No reason to interfere in the decision of the ld. CIT(A), therefore, this ground of appeal of the assessee stand dismissed.
Disallowing film production related expenses - Confirming expenses claimed on account of film production as inflated and bogus - HELD THAT:- To sustain the disallowance it is necessary to have supporting evidences and documents, in the case of the assessee, basis of additions were only retracted statement of the employees which had no strong evidential value. There was no positive material on record brought by the A.O to substantiate that in fact assessee had inflated its expenses by overbilling. AO has only relied on the retracted statement and there was no independent material /evidences to substantiate the same.
A.O has not made further investigation to contrary prove the claim of occurrence of fire as claimed by the aforesaid party. We consider that the decision of ld. CIT(A) to sustain the addition of Rs.5 lac pertaining to the production expenses merely based on retracted statement was contrary to the surroundings facts and material and not justified, therefore, we direct the A.O to delete the addition.
Disallowance of Personal Expenses - A.O has disallowed payment made for J.W. Mariot Hotel Membership. -as claimed that hotel was used for holding meetings with the parties related to production of the films - HELD THAT:- We observe that the part of the hotel facility for personal use cannot be ruled out however, looking to the fact that the impugned addition was merely made on the basis of the retracted statement without fully linking with specific evidences, therefore we restrict such disallowance to 50% of Rs.2,81,265/-. Therefore, this ground of appeal of the assessee is partly allowed.
Expenditure towards production - HELD THAT:- The assessee has also produced ledger account and supporting documents before the assessing officer during the course of assessment proceedings to substantiate these facts that the said amount was not claimed as deduction in the books of the assessee during the year consideration, however the assessing officer failed to prove contrary. Revenue could not controvert the finding of the ld. CIT(A), therefore ,this ground of appeal of the Revenue stand dismissed.
Unsecured loan u/s 68 - loan taken from 5 parties pertaining to Sh.Bhanwarlal Jain Group - HELD THAT:- In the case of the assessee A.O has also failed to controvert the submission of the assessee supported with the relevant material. In the light of the facts and findings of coordinate bench in the Nemichand Jain case as supra, we find that the issue raised before the Tribunal in this year pertaining to the case of the assessee are similar to the case of Nemichand P. Jain. The A.O. had made the impugned addition merely relying upon the retracted statements and failed to corroborate the same with any relevant supporting evidence/material , therefore, addition to be deleted. Decided in favour of assessee.
Disallowance of bogus expenses - expenses as Recee expenses for the different films which comprising Air fare and Travelling Visa fees and Insurance Hotels etc - HELD THAT:- is observed that disallowance was made on doubtful basis without linking to specific seized material demonstrating that claim of the assessee is totally bogus. There is no material brought on record to support the complete disallowances of such expenses. As the nature of personal element cannot be ruled out therefore, we restrict the disallowance to the 50%.
Addition being salary paid to employee in cash - HELD THAT:- It is undisputed fact that lower authority has made impugned addition merely on the sole basis of retracted statement without corroborating the allegation of payment of the such salary in cash with any relevant evidence/supporting material .We don’t find any justification in the decision of ld. CIT(A). Accordingly, this ground of appeal of the assessee is allowed.
Payment towards foreign shooting expenses - HELD THAT:- A.O had not disproved the aforesaid material facts of incurring expenses by the assessee for shooting of the film at London and claim of tax rebate of Rs.3.65 cr. Therefore, we do not find any infirmity in the decision of the ld. CIT(A). Accordingly, this ground of appeal of the Revenue stand dismissed.
Accommodation entry provided by Viking Media Entertainment Pvt. Ltd. - Addition made on the basis of retracted statement of the employees of the assessee - HELD THAT:- During the course of assessment the assessee has submitted the entire document, agreement invoices, bank statement in support of genuineness of transactions. It is undisputed fact that assessee had made the film “Baaghi” on the basis of remake of the telgue film “Varsham”. The A.O has purely relied upon the retracted statement without disproving the correctness of the supporting documents furnished by the assessee. No merit in the appeal of the Revenue.
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2022 (6) TMI 1403 - CUSTOMS AUTHORITY FOR ADVANCE RULINGS, MUMBAI
Classification of goods intended to be imported - Creative Touch 5-series Interactive Flat Panel (IFP) (Model-5652RK, 5752RK, 5862RK) - classifiable under CTH 8471 4190 or not - whether the impugned goods, namely Creative Touch 5-series Interactive Flat Panel can be considered as ADP machines? - HELD THAT:- The machines which operate only on fixed programs, i.e., programs which cannot be modified by the user, are excluded even though the user may be able to choose between a number of such fixed programs. The digital data processing machines have storage capability and also stored programs which can be changed from job to job. Digital machines process data in coded form. A code consists of a finite set of characters (binary code, standard six-bit ISO code, etc.). The data input is usually automatic, by the use of data media such as magnetic tapes, or by direct reading of original documents, etc. There may also be arrangements for manual input by means of keyboards or the input may be furnished directly by certain instruments (e.g., measuring instruments) - Digital data processing machines may comprise in the same housing, the central processing unit, an input unit (e.g., a keyboard or a scanner) and an output unit (e.g., a visual display unit), or may consist of a number of interconnected separate units. In the latter case, the units form a "system" when it comprises at least the central processing unit, an input unit and an output unit.
Two of these units (input and output units, for example) may be combined in one single unit. Two or more of these systems may be interconnected, thus constituting, e.g., a local area network (LAN). These systems may include remote input or output units in the form of data terminals. Such systems may also include peripheral units, apart from the input or output units, designed to increase the capacity of the system, for instance, by expanding one or more of the functions of the central unit.
Open-source information as well as the submissions of the applicant portrays the subject item as an A10 which is a fully functional ADP machine that operates without restrictions. The AIO is equipped with hardware and software that allow it to perform, without artificial constraints, general computing tasks, where users are free to add or remove applications of their choosing
In a similar matter, the principal bench of CESTAT, New Delhi, in M/S. INGRAM MICRO INDIA PRIVATE LIMITED VERSUS PRINCIPAL COMMISSIONER OF CUSTOMS (IMPORT) , NEW DELHI [2022 (2) TMI 308 - CESTAT NEW DELHI] have held that goods would merit classification under CTI 8471 41 90 as claimed by the appellant and not under CTI 8528 52 00 as claimed by the department.
Thus, Creative Touch 5-series Interactive Flat Panel (IFP) (Model5652RK, 5752RK, 5862RK) merit classification under sub heading 8471 4190 of the first schedule to the Customs Tariff Act, 1975.
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2022 (6) TMI 1402 - ITAT AHMEDABAD
Assessment u/s 153A - Bogus exempt LTCG on sale of shares - incriminating material was found or not? - contention of the assessee is this that during the course of search no incriminating material was found from the premises of the appellant - CIT-A quashed proceedings initiated against assessee - HELD THAT:- We find that the assessee’s main contention of not having any incriminating material in the possession of the Ld. AO found during the course of search of the premises of the assessee which ought to have been the main basis of reopening of an unabated assessment and on the contrary addition has been made without due process of law has been taken into consideration in its proper perspective.
The ratio laid down in the case of Saumya construction [2016 (7) TMI 911 - GUJARAT HIGH COURT] and CIT vs. Kabul Chawla [2015 (9) TMI 80 - DELHI HIGH COURT] has been applied rightly by the CIT(A) in the case in hand keeping in view of the particular fact that even the Ld. AO admitted the fact of not having any incriminating material found during the search of the assessee’s premises.
Quashing of the proceeding by the Ld. CIT(A) initiated u/s 153A against the assessee applying the ratio laid down by the judicial forums as indicated hereinabove is just and proper so as to warrant interference.Decided against revenue.
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