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Showing 81 to 100 of 1506 Records
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2016 (1) TMI 1426 - CESTAT CHENNAI
Dutiability - determination of usage of “Residual Fuel Oil” (RFO) in generation of Power - adoption of mathematical formula of 8:13 - HELD THAT:- It is considered necessary that remand of the matter is essential to do justice to both sides on the very crucial issue that has emanated from para-1 of the SCN dated 04.02.02 to determine whether LSHS is equal to RFO and if equal, whether RFO is dutiable following the twin test i.e. process whether constituting manufacture and secondly marketability prescribed by Apex Court in the case of Board of Trustee (supra). So also it is necessary to determine whether the respondent had at any time manufactured RFO and cleared the same issuing any excisable invoice for marketing.
Appeal disposed off by way of remand.
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2016 (1) TMI 1425 - ITAT BANGALORE
Non prosecuting of appeal - HELD THAT:- Inspite of the date of hearing being mentioned in the notice of hearing, which has been issued and served on the assessee by registered post acknowledgement due, nobody was present on the date of hearing. In the circumstances, we are of the opinion that the assessee is not interested in prosecuting its case.
We dismiss the appeal following the decision of the Delhi Bench of the ITAT in CIT v. Multiplan India P.Ltd., [1991 (5) TMI 120 - ITAT DELHI-D] and Estate of late Tukoji Rao Holkar v. CWT [1996 (3) TMI 92 - MADHYA PRADESH HIGH COURT] as the appeal is infructuous for non-prosecution.
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2016 (1) TMI 1424 - DELHI HIGH COURT
Payment of royalty and technical guidance fee - Revenue in nature - HELD THAT:- Question (1) is concerned, it has been answered in favour of the Assessee in Assessee’s own case CIT v. Hero Honda Motors [2015 (2) TMI 368 - DELHI HIGH COURT]. The Court, accordingly, declines to frame a question of law on this issue.
Addition u/s 40(a) (ia) - export commission is neither royalty nor fee for technical service - HELD THAT:- As far as Question (2) is concerned, learned counsel for the Revenue states that he would like to address arguments on the next date.
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2016 (1) TMI 1423 - MADHYA PRADESH HIGH COURT
Review petition - Deduction u/s 80IB (10) (a) (ii) - delay in filing of review petitions - HELD THAT:- Neither the provisions of the Corporation Act which have been relied by the review petitioners in the present petitions nor the decision of the Supreme Court will be of any avail.
Review petitioners in all fairness submits that the decision of the Supreme Court in S. Sundaram Pillai's case [1985 (1) TMI 306 - SUPREME COURT] was not dealing with the express provision such as Explanation sub-Clause (ii) below Section 80IB (10) (a) (ii). As a result, no case for review is made out.
Review petitioners submits that the review petitioners be granted liberty to take recourse to remedy of appeal before the Supreme Court. It is open to the review petitioners to pursue such other remedy as may be permissible in law. This request, however, cannot be entertained in review petitions.
Review petitioner in Review Petition then submits that the remedy of appeal was not available to the Department in the fact situation of that case. For, the Tribunal had already set aside the decision of the lower Authority and referred back the matter to the AO. Even so, in our opinion, that would not warrant review of the judgment under consideration on that count, as the interpretation given to the provisions contained in Section 80IB (10) as amended by the Finance (No.2) Act, 2004 which came into force w.e.f. 1.4.2005, would still apply in all cases heard and disposed of together.
Taking any view of the matter all these review petitions must fail and the same are dismissed.
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2016 (1) TMI 1422 - BOMBAY HIGH COURT
Territorial Jurisdiction - meaning of the term, “cause of action” - HELD THAT:- There is nothing in the petition so as to reveal the facts that form part of cause of action regarding territorial jurisdiction to entertain the present petition by this Court. On comparing the facts of the present petition with the facts of the aforecited case of Alchemist Ltd. & another, it would reveal that in the said case though some of the things had happened in Chandigarh, viz. the officers of the Bank visited Chandigarh for negotiation and deposited the amount in the State Bank at Chandigarh pursuant to the negotiation, however, in the present case any such cause event has not taken place within the territorial jurisdiction of this Bench.
No part of cause of action arises within the territorial jurisdiction to entertain this petition by this Bench - the writ petition is rejected on the sole ground of territorial jurisdiction.
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2016 (1) TMI 1421 - GUJARAT HIGH COURT
Reopening of assessment - notice for reopening on the ground that AO had relied on the show cause notice issued by the Excise department to form a reason to believe that income chargeable to tax had escaped assessment - HELD THAT:- Tax Appeals are admitted for consideration of following substantial question of law :
“1 Whether the ITAT is justified in law as well as on facts in holding that reopening of the assessment under section 147 and 148 of the Act is bad in law and cannot be sustained and thereby further holding that the reassessment orders are required to be cancelled?
2. Whether the ITAT is justified in law as well as on facts in dismissing the appeal filed by the Department and quashed and set aside reassessment order passed by the Assessing Officer without considering the department appeal against order passed by the CIT(A) on merits?”
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2016 (1) TMI 1420 - KARNATAKA HIGH COURT
Adjustment of TDS - Adjustment of tax deducted of the amount so deducted from the main contractor towards tax arrears due by the petitioner - rejected on the ground that there is no provision under the Act for such adjustment of tax - HELD THAT:- The amounts paid to the sub contractor by the principal contractor which had already suffered tax in the hands of the principal contractors and that therefore the turn over once again could not be subjected to tax in the hands of the sub contractor and if it is done, it would be a case of double taxation. On that reasoning those petitions having been disposed of - The same principle will apply to the present case on hand.
The respondents are directed to adjust the tax already collected from the principal contractor in respect of the liability sought to be fastened on the petitioner - Petition disposed off.
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2016 (1) TMI 1419 - KARNATAKA HIGH COURT
Adjustment of tax already deposited by principal contractor - whether the respondents are justified in not adjusting the tax already deducted by the Principal Contractor, and once again seeking to tax the petitioners in respect of the same amount which has been deducted by the principal contractor? - HELD THAT:- The amounts paid to the sub contractor by the principal contractor had already suffered tax in the hands of the principal contractors and that therefore the turn over once again could not be subjected to tax in the hands of the subcontractor and if it is done, it would be a case of double taxation.
The petitions are accordingly disposed of holding that the petitioners could not be subjected to tax on the amounts which were already deducted by the principal contractor and of which tax had been collected.
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2016 (1) TMI 1418 - GUJARAT HIGH COURT
Notice, and Notice as to interim relief, returnable on 6th January, 2016.
Direct service is permitted.
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2016 (1) TMI 1417 - ITAT CHENNAI
Addition made towards Fringe Benefit Tax - contribution made to superannuation Fund - HELD THAT:- The assessee company has made a provision for contribution to superannuation fund and the same was paid in the next Financial year. There is no dispute about the provision and the payment and there is no escapement of value and same was subject to fringe benefit tax. Similar issue was considered by the Co-ordinate Bench in the case of M/s. Bharat Overseas Bank [2013 (2) TMI 881 - ITAT CHENNAI] wherein held that provision of contribution to the approved superannuation fund was not subject to charging of FBT. Accordingly, we direct the Assessing Officer to delete the addition. - Decided in favour of assessee.
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2016 (1) TMI 1416 - ITAT DELHI
Reopening of assessment u/s 147 - Addition u/s 68 - unexplained cash credits being share application money - HELD THAT:- No inquiries were made by the AO on the basis of the information supplied by the assessee we are in agreement with the finding of the CIT(A) that arguments and evidences provided by the assessee to substantiate that the transaction regarding Share Application Money received by' the assessee were genuine transactions and the same were not accommodation entries. We also do not find any evidence collected by the A.O. which could prove otherwise. Accordingly, the AO was not justified in treating the amount of share application money received by the assessee as its undisclosed income. CIT(A) has rightly deleted the addition made by the AO u/s. 68 of the I.T. Act, 1961 and has passed a well reasoned order on the issue in dispute. - Decided against revenue
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2016 (1) TMI 1415 - ITAT MUMBAI
Disallowance made under the head project risk expenses (PRE) - liquidated damages for breach of contract for delay in supply of goods - Allowable expenditure incurred for the purpose of business u/s 37(1) - HELD THAT:- As per the conditions of the agreement entered by the assessee with the HPCL, assessee had to compensate HPCL for delay in executing the project, that the factum of delay is not in dispute. Therefore, in our opinion the issue is directly covered by the decision of KCP Ltd. [1990 (6) TMI 111 - ITAT HYDERABAD-B]
As relying on BHARAT EARTH MOVERS VERSUS COMMISSIONER OF INCOME-TAX [2000 (8) TMI 4 - SUPREME COURT] liquidated damages for breach of contract for delay in supply of goods are allowable deduction in the assessment year relevant to the point of time when the breach occurred and not the point of delivery of goods and raising of bills.Ground no.1 is decided in favour of the assessee for the two amounts i.e. ₹ 1.26 crores and ₹ 81.00 lacs.As far as ₹ 31.83 lacs is concerned we are of the opinion that AO should add back the PRE while computing deduction u/s. 10A/B in view of the decision of Hon'ble Jurisdictional High Court delivered in the case of Gem Plus Jewellery [2010 (6) TMI 65 - BOMBAY HIGH COURT]
Adjustment on account of notional interest on overdue receivable - During the assessment proceedings,the AO found that the assessee had entered in to international transactions - HELD THAT:- The transaction in question is an international transaction and not a result of a transaction as argued by the AR.The assessee had provided specific services to its AE's therefore the series of events cannot be termed a result of international transaction. Once it has been decided that issue before us is a Transfer Pricing issue then the value of the transaction has to be determined.
It is a case where the TPO has relied upon on the agreement entered into by the assessee with its AE and has treated it as a Benchmark.We find that no independent source was searched or relied upon by the him.It is a fact that the agreements with the third parties did not contain any clause for charging interest for delayed payment.
Thus,the matter has its own peculiarities.The assessee has entered in to agreement with the AE.s.and value of the transaction will have to be decided.The arguments of factoring of delayed payment in the value of service cannot be brushed aside especially when it is found that the OPTC margin earned by the assessee was 29.41 % and it was quite higher than the parties compared with i.e.app.15%.The TPO had not considered these vital issues and had applied the flat rate of 2%,as mentioned in the agreement.In our,opinion the alternate argument advanced by the assessee of adopting LIBOR rate is worth considering,if the facts of the case under appeal are deliberated upon. In the interest of justice interest rate should be fixed at LIBOR+200 points for the delayed payments received by the assessee from its AE.s.for the period as mentioned in the agreements.AO is directed to recalculate the interest amount accordingly.Ground no.4-5 are decided in favour of the assessee,in part.
Disallowance of expenditure under the heads ‘communication and network services’ and ‘IT Infrastructure Services’ - HELD THAT:- Assessee had filed invoices and the basis of payments made under the heads communication and network related services and IT Infrastructure service charge (page- 418-425 of the PB). It is found that assessee had made submission in that regard before FAA and had produced group IT Service agreement.We find that same were not properly analysed by the TPO/ FAA.We are of the opinion that issue needs further verification and investigations. Therefore, in the interest of justice we are remitting back the matter to the TPO for fresh adjudication who will decide the issue after affording a reasonable opportunity of hearing to the assessee. The assessee is directed to produce all the necessary documents related to Communication and network related services and IT Infrastructure service charge to the TPO
Computation of deduction u/s 10A - reducing expenditure incurred in foreign currency for providing technical services from total turnover - HELD THAT:- Hon’ble Bombay High Court in assessee’s own case has decided the issue in íts favour for the AY.s. 2002-03-2005-06 [2013 (1) TMI 984 - BOMBAY HIGH COURT], [2013 (2) TMI 878 - BOMBAY HIGH COURT] and 2011 (7) TMI 1350 - BOMBAY HIGH COURT] wherein as held that the expenses reduced from the figure of export turnover should also be excluded from the figure of total turnover while computing deduction under section 10A & 10B
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2016 (1) TMI 1414 - ITAT MUMBAI
Revision u/s 263 - AO failed to examine as to whether the conditions specified in sec. 37(1) were satisfied or not in the claim so made by the assessee - Claim of club membership fee - HELD THAT:- Assessee’s explanation that the club membership fee was paid for a representative of the assessee was accepted by the AO on the face of it. The documents furnished along with the reply letter furnished by the assessee clearly show that the membership fee was paid for Mrs. Lata Vasvani. There should not be any dispute that the club membership fee was allowed u/s 37(1) of the Act, where in there is a requirement to show that the expenditure was incurred for the purpose of business, it was not personal expenditure or capital expenditure etc.
We notice that Mrs. Lata Vasvani was not an employee or a director of the assessee company. She was not paid any other kind of compensation from the funds of the company. Normal business practice is to take the membership in the name of the company or in the name of top employees as per their service terms and conditions. Hence, in our view, the assessing officer has failed to apply his mind on the reply given by the assessee. The assessing officer, in our view, has failed to examine as to whether the conditions specified in sec. 37(1) were satisfied or not in the claim so made by the assessee. Accordingly, we are of the view, the present case is a case of lack of enquiry on the claim made by the assessee.
In the absence of required enquiry, it cannot be said that the assessing officer has taken one of the possible views. Accordingly, we are of the view that there is no infirmity in the action of the Ld CIT in initiating the revision proceedings u/s 263 of the Act. - Decided in favour of assessee.
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2016 (1) TMI 1413 - ITAT KOLKATA
Net profit estimation - CIT-A estimating the net profit @ 2.5% of contract receipts of the assessee as against 8% adopted by the Learned AO - accounts of the assessee were duly subjected to tax audit u/s 44AB -HELD THAT:- Depreciation and interest is allowable as deduction from the estimated net profit of 8% by the Learned AO and the resultant profit figure was 2.1% of contract receipts and further hold that the Learned CIT(A) had rightly estimated the net profit @ 2.5% of contract receipts to meet the ends of justice. Hence we don’t find any infirmity in the order of the CIT(A). Accordingly, the grounds raised by the revenue are dismissed.
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2016 (1) TMI 1412 - DELHI HIGH COURT
Condontion of delay - delay of 790 days in re-filing the appeal - HELD THAT:- The practice directions were issued after consultation with the bar and after giving sufficient time for the bar to get acquainted with the requirement of e-filing. Additionally, the Court has also provided scanning machines at the filing counter so that no difficulty is caused to the bar for switching over to the system of e-filing. In any event, the delay of over two years on this ground is wholly unacceptable.
The Court is not persuaded to condone the extraordinary delay of 790 days in re-filing the appeal. The application seeking condonation of the delay of 790 days in re-filing the appeal is dismissed.
Addition on account of technical know-how and royalty expenses paid by the Assessee to Honda Motor Co. Ltd, Japan - HELD THAT:- Payment made on account of entry tax; provision for warranty and sales services; software expenses and cost of air tickets and other travel expenses. It is not in dispute that for the earlier AYs in each of the above issues, the Court has answered the questions in favour of the Assessee and against the Revenue. The assessment order passed by the AO, in fact, notes that Question no.1 stands answered by this Court against the Revenue.
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2016 (1) TMI 1411 - PUNJAB AND HARYANA HIGH COURT
Power to remand the case back to the arbitrator - HELD THAT:- The objecting court has no power to remand the matter back to the arbitrator once the court has set aside the award. It is not the case where the arbitrator has omitted to refer to certain claims so exception.
Instead of pondering upon the calculations referred to during the course of arguments, I am of the view that the same shall be subject matter of the objecting court. In essence, both the parties shall be given one-one effective opportunity to submit their calculations viz-a-viz amount constituting 75% of the awarded amount as per award dated 21.6.2010 and thereafter the objecting court shall determine 75% of the awarded amount and give another fifteen days' time to the appellant to deposit 75% of the amount. In case of non-deposit of the same, objections shall be deemed to have been dismissed. If otherwise, the objecting court shall decide the matter pragmatically, much less in accordance with law.
Appeal disposed off.
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2016 (1) TMI 1410 - ITAT DELHI
CIT(A) power to correct jurisdictional errors - Disallowance u/s 14A - Non-recording of satisfaction results - whether the basic functions assigned to the assessing officer in the Act can be discharged by CIT(A) while exercising his coterminous power or not? - HELD THAT:- Under section 251 CIT(A) in an appeal against an order of assessment is empowered to confirm, reduce, enhance or annul the assessment but if the assessment order suffers from jurisdictional errors then CIT(A) has no power to correct such jurisdictional errors. The coterminous powers vested in CIT(A) does not imply that he can clothe himself with powers to correct the jurisdictional defects in the assessment order. It is well settled law that where the very initiation of assessment proceedings by the AO was invalid then Ld. CIT(A) cannot direct for making a fresh assessment. CIT(A) should annul the assessment where the assessment proceeding is a nullity in the sense that the AO had no jurisdiction ab initio to take the proceeding.
AO could take up the issue regarding disallowance u/s 14A only after recording satisfaction. Non-recording of satisfaction results into creeping of illegality in the assessment order and not a mere irregularity. The jurisdiction of recording satisfaction for invoking section 14A lies with the assessing officer and once he has not recorded such satisfaction then the said basic function of AO which clothes him jurisdiction to make disallowance u/s 14A cannot be usurped by CIT(A). We, therefore set aside the order of CIT(A). - Decided in favour of assessee.
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2016 (1) TMI 1409 - SUPREME COURT
Effect of amendment - Rule 8(8) of the Tamil Nadu Minor Mineral Concession Rules, 1959 which was amended by G.O. Ms. No. 391 dated 17.11.2000 - whether the amendment would have retrospective effect or will become operational prospectively i.e. only from 17.11.2000?
HELD THAT:- Rule 8(8) of the 1959 Rules which prescribes period for grant of lease is not procedural but substantive in nature. By amendment, change in the said Rule was effected with the classification of areas into "virgin area" and "other areas that is non-virgin areas". It is only in respect of virgin areas that the period of lease stands enhanced to ten years whereas in respect of other areas the period of lease continues to be five years. This was clearly a substantive amendment which had nothing to do with any procedure. There was no concept of "virgin area" in the unamended rule which has been introduced for the first time by way of aforesaid amendment.
An error is committed by the High Court in holding that fixation of period of lease is also procedural. When a decision to grant lease is substantive in nature, the period for which the lease is to be granted would also be substantive. Thus, the conclusion arrived at by the High Court is contrary to law.
It is to be borne in mind that a particular provision in a procedural statute may be substantive in nature and such a provision cannot be given retrospective effect.
Appeal allowed - decided in favor of appellant.
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2016 (1) TMI 1408 - SC ORDER
Adjustment restricted only on international transactions where the assessee has selected TNMM and applied the same on entity level by ITAT - Addition as the adjustment is with ±5 per cent - Tribunal deleting the addition as the adjustment is with ±5 per cent. as the Income-tax Appellate Tribunal has restricted the adjustment only on associated enterprise transactions which has resulted the adjustment within ±5 per cent. - Disallowance under section 14A - HELD THAT:- Delay condoned. Issue notice on Question No. (c) in the Special Leave Petitions.
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2016 (1) TMI 1407 - ITAT PUNE
Deduction u/s. 43B - expenses incurred by the assessee on account of taxes and fees not pertaining to the year under consideration - method of accounting followed by the company - HELD THAT:- Tribunal in assessee’s own case for the assessment year 2003-04 placing reliance on the decision rendered by the Special Bench in the case of DCIT Vs. Glaxo Smithkline Consumer Healthcare Ltd. [2007 (7) TMI 334 - ITAT CHANDIGARH] and hold that the deduction for tax, duty etc., is allowable under section 43B of the Income-tax Act, 1961 on payment basis before incurring the liability to pay such amounts. Accordingly, the first question is answered in affirmative and in favour of the assessee.
Expenditure and free services to the customers - HELD THAT:- This issue has also been considered in the assessee’s own case for the assessment year 2003-04 placing reliance on the decision of BHARAT EARTH MOVERS VERSUS COMMISSIONER OF INCOME-TAX [2000 (8) TMI 4 - SUPREME COURT] rejected the contentions of the Revenue and upheld the findings of Commissioner of Income Tax (Appeals) in favour of the assessee. What should be certain is the incurring of the liability. It should also be capable of being estimated with reasonable certainty though the actual quantification may not be possible. If these requirements are satisfied the liability is not a contingent one. The liability is in praesenti though it will be discharged at a future date. It does not make any difference if the future date on which the liability shall have to be discharged is not certain - Decided against revenue
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