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2020 (3) TMI 1391 - TELANGANA HIGH COURT
Seeking restraint on Respondents and their agents/officers from taking any coercive steps including investigation under Section 212 of the Companies Act, 2013 - HELD THAT:- This Court, having considered the submissions of the learned counsel appearing for the respective parties is of the considered view that as on today, the cause in the writ petition does not survive as the respondents have already passed order dated 27.02.2020 under Section 212 of the Act. However, if the petitioner is aggrieved, he is at liberty to challenge the same, in accordance with law.
Petition disposed off.
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2020 (3) TMI 1390 - NATIONAL COMPANY LAW TRIBUNAL PRINCIPAL BENCH, NEW DELHI
Validity of decision of the RP for not short listing its Resolution Plan despite its plan is in compliance with Section 30(2) of the Insolvency and Bankruptcy Code, 2016 - validity of decision of RP for short listing and approving the CarVal’s Resolution Plan as successful Resolution Plan - whether the economic interest of this Applicant is getting prejudiced because his plan has not been admitted? - HELD THAT:- Once plan is shortlisted, if at all any remedy is assumed to be present, it is only with regard to the procedure, as to the procedure is concerned, in Regulation 39 of the CIRP Regulations it has been categorically mentioned that the Committee of Creditors shall evaluate the resolution plan received under Regulation 39 strictly as per the evaluation matrix to identify the best resolution plan, when evaluation matrix figures are there, that being the special subject, as long as there is no objection from any of the Committee of Creditors over the process of evaluation, if the evaluation matrix discloses marks identifying the best plan, the CoC will have to opt for the best plan provided it is viable and feasible. That is the subject matter of the CoC - In Regulation 39(3), when it comes to second clause, since approval is required to be given to the plan shortlisted, it was approved by the CoC with requisite majority. At this juncture, SSG subsequently coming with an unsolicited plan cannot become an impediment to proceed with the shortlisted plan.
Merely by having an open discussion in the CoC meeting and asking about SSG plan by some CoC Members having minority voting in the CoC cannot become a reason to invalidate the plan approved. Moreover, none of the CoC Members who abstained to the voting of CoC have filed any objection before this Bench. The point to be noted, these Applicants have not stated that D & P Report is factually incorrect - Once plans are submitted, it is the CoC to take a decision thereafter it is only an intimation to the plan Applicants as to whether their plan is shortlisted or not, it is nowhere mentioned in the Code that Plan Applicants have right to participate in short listing the plan applications.
Operational Creditor is not aggrieved of any of the actions of the CoC. Thumb rule i.e. followed in dealing with civil remedies is, when a person seeks remedy before Court of law, he shall be aggrieved by the action assailed in his application. When grievance is not present in its complaint, such person cannot seek relief before any Court of law. What does this Operational Creditor get on declaration of this entire process as null and void? Noble has not deliberated anything on it. Maybe it is either to help SSG or for some undisclosed reasons, which cannot be seen as grievance of Noble - It is not the case of Noble that the distribution to be reached to it under section 53 has not been provided, if that is the case, it could become the grievance of the Applicant. But that is not the case of this Applicant and that cannot be the case of the applicant.
Taking a lead for approval of a superior plan, which the CoC has approved with thumping majority considering it as feasible and viable cannot be called as SBI favoring Carval group - Application disposed off.
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2020 (3) TMI 1389 - ORISSA HIGH COURT
Revision u/s 263 by CIT - HELD THAT:- As applying the meanings attached, "may" implied to section 263 of the Income-tax Act mentioned above, the power has been vested with the Principal Commissioner, who may call for the records and may, after giving the assessee an opportunity of being heard, pass the order. Using of word in the present context "may" is capable of meaning "must" or "shall" where a discretion is conferred upon a public authority coupled with an obligation, thereby the use of word "may" has to be construed to mean a command.
In view of the provisions contained in section 263, the Commissioner is duty bound to give an opportunity of being heard, while exercising the revisionary jurisdiction, to the appellant while enhancing or modifying the assessment or cancelling the assessment or directing for fresh assessment in conformity with the provisions contained under section 263 of the Income-tax Act.
As applying the meanings attached, "may" implied to section 263 of the Income-tax Act mentioned above, the power has been vested with the Principal Commissioner, who may call for the records and may, after giving the assessee an opportunity of being heard, pass the order. Using of word in the present context "may" is capable of meaning "must" or "shall" where a discretion is conferred upon a public authority coupled with an obligation, thereby the use of word "may" has to be construed to mean a command.
In view of the provisions contained in section 263, the Commissioner is duty bound to give an opportunity of being heard, while exercising the revisionary jurisdiction, to the appellant while enhancing or modifying the assessment or cancelling the assessment or directing for fresh assessment in conformity with the provisions contained under section 263 of the Income-tax Act.
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2020 (3) TMI 1388 - NATIONAL COMPANY LAW TRIBUNAL, GUWAHATI
Seeking direction to RP to take on record and to consider the revised offer - HELD THAT:- As per the material placed before this Tribunal, the resolution plan submitted by the highest bidder has already been approved by the COC on 12.02.2020 with 100% voting and also submitted to this this Tribunal for its approval. It also transpires from the written Minutes of Meeting dated 11.02.2020 of the 5" COC meeting that the petitioner insisted the COC to provide the individual score and the bid amount of all the RPAs before its presentation of plan and confronted with the COC in not providing that information which is highly uncalled for. It also transpires from record that the petitioner abstained from attending the meeting on 12.02.2020 and despite their absence, the COC applied its mind on the earlier plan submitted by the petitioner and taken conscious call.
Since the resolution plan of the highest bidder has already been approved with 100% voting, the above application is not only infructuous but also liable to be rejected on account of latches and lack of bona-fides on the part of the petitioners.
Application rejected.
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2020 (3) TMI 1387 - ITAT MUMBAI
Unexplained investment in respect of bogus purchases - As argued sales have been accepted as genuine from out of these purchases and hen the sales have been accepted as genuine the entire purchases cannot be treated as non-genuine - HELD THAT:- Hon’ble Gujarat High Court in the case of Bholanath Polyfab Pvt. Ltd [2013 (10) TMI 933 - GUJARAT HIGH COURT] held that when the assessee made purchases and sold the finished goods as a natural corollary not the entire amount covered under such purchases would be subject to tax but only the profit element embedded therein.
Similar view has been taken in the case of CIT v. Simit P. Seth [2013 (10) TMI 1028 - GUJARAT HIGH COURT] -Simply because the parties were not produced the entire purchases cannot be added as held by the Bombay High Court in the case of CIT v. Nikunj Eximp [2013 (1) TMI 88 - BOMBAY HIGH COURT] - However, at the same time keeping in view the nature of business of the assessee and the fact that the assessee is making some local purchases without any transportation bills, lorry receipts etc, the possibility of making purchases in gray market on cash cannot be ruled out. Taking the totality of facts and circumstances into consideration and the nature of business carried on by the assessee we direct the Assessing Officer to restrict the disallowance/addition to 4% of the bogus purchases. Accordingly, we direct the Assessing Officer to restrict the disallowance of purchases to 4% and compute the income accordingly. Appeal of the assessee is partly allowed.
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2020 (3) TMI 1386 - ITAT JODHPUR
Revision u/s 263 by CIT - AO had erred in observing that the amendment in Section 68 and Section 56(2)(viib) were applicable only from A.Y. 2013-14 - HELD THAT:- In the reassessment order passed, the issue had been duly examined and on the basis of the examination of the relevant records and the application of law, one of the possible opinion had been drawn by the A.O., which cannot be said to be erroneous so far as prejudicial to the interest of revenue.
As decided in MALABAR INDUSTRIAL CO. LTD. VERSUS COMMISSIONER OF INCOME-TAX [2000 (2) TMI 10 - SUPREME COURT] AO after going through the material on record and after considering the explanation of the assessee, had applied his mind. His view was that the amendment are not applicable in the case of the assessee for the year under consideration which is a possible view. The CIT did not agree with the conclusion reached by the ITO - Section 263 of the Act does not empower him to take action on these facts to arrive at the conclusion that the order passed by the ITO is erroneous and prejudicial to the interest of the revenue. Since the material was there on record and the said material was considered by the ITO and a particular view was taken, the mere fact that different view can be taken, should not be the basis for an action U/s 263 of the Ac and it cannot be held to be justified.
In the present case it cannot be said that there is an incorrect application of law so that the order being erroneous. The amendments were from A.Y. 2013-14 and the judicial decisions were also to the effect that it cannot be made in relation to share capital where identity is proved. The phrase "prejudicial to the interests of the Revenue" has to be read in conjunction with an erroneous order passed by the Assessing Officer. The view of the AO that the amendments were not retrospective is also one of the possible view and such a view cannot be said to be erroneous.
Unless there are words in the statute sufficient to show the intention of the legislature to affect existing rights, it is deemed to be prospective only." In view of above we find that there is no error in the conclusion drawn by the AO while passing the order and therefore, the impugned order U/s 263 of the Act is not justified and the same is hereby quashed. - Decided in favour of assessee.
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2020 (3) TMI 1385 - ITAT BANGALORE
Unexplained credit/ advances - Addition of closing credit balances - addition includes three items received by the assessee from his spouse and two other persons - HELD THAT:- Addition of the two amounts from other persons cannot be sustained because these are opening balances and not received in the present year
Advance from a wife - No specific section mentioned to make the addition - About the third amount we find that his is a fact that no section is mentioned by the AO or CIT (A) for making this addition and for this reason alone, the addition is bad in law as per the tribunal order cited by the learned AR of the assessee having been rendered in the case of Smt. Sudha Loyalka vs. ITO [2018 (7) TMI 1892 - ITAT DELHI] wherein it was held that non mentioning the precise section makes the addition bad in law. Even if we accept the argument of revenue that this addition is u/s 68 because this addition is made by the AO by holding that loan shown by the assessee is added because creditworthiness of the loan creditor is not established, we are of the considered opinion that the assessee has established the creditworthiness of his wife by bringing a certificate of Village Administrative Officer that the wife of the assessee is holding 5 Acres of Agricultural Land and she is growing Banana, Cabbage, Beans, Carrot, Ragi, Neelagiri and other fruits and vegetables and her annual income is certified by him at ₹ 12 Lacs. For this reason also, this addition is not justified - Assessee appeal allowed.
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2020 (3) TMI 1384 - NATIONAL COMPANY LAW TRIBUNAL, KOLKATA
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditor - arbitration award passed in favour of the Operational Creditor - pre-existence of dispute or not - applicability of time limitation - Two parallel proceedings can be filed on the same cause or not? - HELD THAT:- It is seen that there are internal notings made by the Corporate Debtor in its office files which is being referred to and relied upon as an acknowledgment of debt by the Operational Creditor. Even if the said document is taken as an acknowledgment for the purpose of section 18 of the Limitation Act, 1963, the last noting is dated 02.12.2010. If the limitation is calculated on the basis of the said date, the limitation stopped running on 01.12.2013. Apart from the said office notings no other document has been filed that acknowledges the debt within the period of limitation - the challenge against the Arbitral Award cannot be considered to having saved the limitation period for the Financial Creditor.
The Operational Creditor has filed office notings of the Corproate Debtor as well as a cheque that was issued in 2016, The Operational Creditor has failed to show that there is a continuous chain of events without violating the provisions of the Limitation Act, 1963. The Hon’ble Supreme Court of India by an order in B.K. EDUCATIONAL SERVICES PRIVATE LIMITED VERSUS PARAG GUPTA AND ASSOCIATES [2018 (10) TMI 777 - SUPREME COURT] has held that: An application filed after the IBC came into force in 2016 cannot revive a debt which is no longer due as it is time- barred. The amendment of s. 238A would not serve its object unless it is construed as being retrospective. Otherwise, applications seeking to resurrect time-barred claims would have to be allowed, not being governed by the law of limitation.
It is clear from a reference to the Insolvency Law Committee Report of March, 2018, that the legislature did not contemplate enabling a creditor who has allowed the period of limitation to set in to allow such delayed claims through the mechanism of IBC.
This application is time barred - Petition dismissed.
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2020 (3) TMI 1383 - CESTAT AHMEDABAD
CENVAT Credit - requirement to pay 5%/6%/7% of the value of exempted services - rule 6 of Cenvat Credit Rules, 2004 - HELD THAT:- Demand was raised under Rule 6(3A) i.e. 5%/6%/7% of the value of exempted services. It is the submission of learned Chartered Accountant that during the period involved in all the three cases, no Cenvat credit of common input services was availed. If this is correct, then the question of raising any demand under Rule 6(3A) will not arise. However, the fact whether during the period 2013-14 to 2015-16 appellant has not availed Cenvat credit or otherwise, has neither been properly submitted by the appellant nor the Adjudicating Authority or Commissioner (Appeals) has verified.
The matter should go back to the Adjudicating Authority to verify whether the appellant has availed Cenvat credit on common input service during the relevant period - Appeal allowed by way of remand.
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2020 (3) TMI 1382 - NATIONAL COMPANY LAW TRIBUNAL, AHMEDABAD BENCH
Seeking sanction of the scheme of arrangements in the nature of demerger as well as the restructure of the equity share capital - section 230-232 r/w 66 of the Companies Act, 2013 - HELD THAT:- Considering the entire facts and circumstances of the case and on perusal of the Scheme and the documents produced on record, it appears that all the requirements of section 230 and 232 of the Companies Act, 2013 are satisfied and the Scheme is not prejudice to the interest of shareholder(s) and creditor(s) as well as in the public interest.
The Scheme which is at Annexure- 'F' to the petition is hereby sanctioned and it is declared that the same shall be binding on the petitioner companies, their shareholders, secured creditors and unsecured creditors and all concerned under the scheme. The proposed amendments of the Memorandum of Association of the Petitioner De-merged Company and the Resulting Company with regard to changes in the Authorised Capital and the Objects Clause of the Petitioner companies as envisaged under Clause Il are hereby granted. The change of name of the petitioner companies shall be subject to the confirmation by Registrar of Companies for availability of such names. The reduction of the Share Capital of the Resulting Company as envisaged under Clause 12 of the Scheme is allowed.
Petition allowed - decided in favor of petitioner.
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2020 (3) TMI 1381 - NATIONAL COMPANY LAW TRIBUNAL, INDORE
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt abd dispute or not - Time limitation - HELD THAT:- It is also a matter of record that the Petitioner could not be able to produce acknowledgement of service of the statutory demand notice of Section 8 of the I.B. Code. The present petition and the petitioner has stated that although it sent to the registered office of the company through a speed post. However, the same came back undelivered with a remark, “concerned official not available.” Hence, the petitioners took such plea that it tantamount to avoidance of accepting the service of demand notice. Hence, it is to be treated as deemed service - this Adjudicating Authority under the discipline of the I.B. Code is not expected to adjudicate such issue of disputed facts or to deal with such controversy while disposing of the present I.B. Petition.
It is evident that the Corporate Debtor has raised Debit Note on 16.11.2015 and also got tested the quality of steam coal supplied. Further, the Petitioner in its petition in Column part4 (1)(b) Bullet Point No. (7) has stated that it made quite delayed payment on 25.11.2014. Such payment was received after rigorous follow up by the Operational Creditor. Thereafter, the Corporate Debtor did not even make a single payment to the Operational Creditor. Therefore, such raise prima-facie doubt about some pending dispute with regard to the quality of goods and or on existing dispute on terms and condition payment thereof, which are undisputedly of prior to issuance of the demand notice and filing of the present petition.
The CIRP can be triggered in respect of Corporate Debtor only in situation where defence taken by the Corporate Debtor is found spurious and feeble. Which is not the case here as the Corporate Debtor has furnished the debit note and as well as copy of Coal Analysis Report based on lab test of coal supplied and the same was found of poor and inferior quality which are prima-facie evidence of dispute and such disputed question of facts are required to be agitated before a proper forum of Law, as it is out of purview of the I.B. Code to be adjudicated by this Adjudicating Authority.
The present appeal is found to be filed beyond three (03) years from the date of default or the last payment received because, the Petitioner, itself in ‘Part- 4,’ Column 1(b) of the present petition has pleaded that the Corporate Debtor made the last payment of ₹ 1500 Lakhs to the petitioner on 25.11.2014, that is too after a rigorous follow up by the Operational Creditor with the Respondent/ Corporate Debtor that means that there was some pre-existing dispute as well as the present petition is filed on 09.05.2018, which is beyond the prescribed limitation of three (03) years.
The present I.B. Petition is not maintainable on the ground of pre-existing dispute as well as being hit by limitation - Petition dismissed.
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2020 (3) TMI 1380 - ITAT MUMBAI
Addition u/s 43CA - disallowances being difference between agreement value for sales and the stamp value for the registration - HELD THAT:- Upon careful consideration as regards the addition on account of flat No. 1902 is concerned, the assessee's plea that agreement was entered into in 2012 cannot be accepted as learned CIT(A) has rightly observed that assessee has chosen to declare the same in the present assessment year.
Proviso which has been inserted in section 43CA(1) with effect from 1.4.2019 a cardinal principle of interpretation is to look at the mischief, the act, the amendment, the proviso is aimed to remove or take care of. In the present case find that proviso was inserted to grant relief where there is only a 5% variation in the agreement value and stamp value.
In such circumstances the proviso granted relief in as much as the difference of 5% is to be ignored and the deeming provision of section 43-CA shall not be invoked. I find that this proviso is aimed at mitigating the hardship or the mischief which was caused to the taxpayer on the invocation of deeming provisions of section 43- CA where there is marginal variation upto 5% - this proviso shall take retrospective effect. Hence I hold that in cases where the variation is up to 5% no addition shall be made by the assessing officer by invoking the provisions of section 43-CA. Accordingly, the matter stands remitted to the file of assessing officer. The assessing officer shall restrict the disallowances only to those cases where the variation exceeds 105%. Needless, the assessee shall be granted adequate proportionate being heard. Appeal of assessee stands partly allowed.
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2020 (3) TMI 1379 - SUPREME COURT
Rejection of Bail application - Sections 417, 420, 467, 468, 471, 120-B read with 34 of Indian Penal Code - HELD THAT:- The investigation has been completed and chargesheet has been filed. Charges have also been framed. State has also filed affidavit stating that further investigation is going on.
Further investigation may go on in which petitioner shall also cooperate. After having heard learned counsel for the parties and perusing the records, the petitioner has made out a case for grant of bail on the terms and conditions as may be fixed by the Trial Court - SLP disposed off.
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2020 (3) TMI 1378 - CALCUTTA HIGH COURT
Block assessment - Addition to the assessee on a “protective basis” - protective addition was made in connection with a block assessment order made in the case of Shaw Wallace & Co. Ltd. (SWC) where these additions were made in a “substantive manner” - According to the tribunal, since this substantive addition had been set aside and remanded, the case of the assessee required a re-look - HELD THAT:- We find from the impugned order of the tribunal that it has not confined itself to this narrow issue but has made consideration of issues which were not remanded to it.
We find also from the impugned order of the tribunal has not addressed these issues in the manner that they should have been dealt with in accordance with the earlier order of the tribunal
For those reasons, we set aside the impugned order of the tribunal dated 31st March, 2005. As fifteen years have elapsed, we direct the tribunal to redetermine the appeal as expeditiously as possible by hearing the parties and by a reasoned order preferably within four months of communication of this order.
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2020 (3) TMI 1377 - SUPREME COURT
Seeking to be joined as Respondent No. 4 in the said Special Criminal Application - seeking further investigation against other persons (other than the Appellant who is one of the Accused and is already charge-sheeted) - HELD THAT:- No error has been committed by the High Court dismissing the application submitted by the Appellant herein to implead him in the Special Criminal Application filed by the private Respondent herein challenging the order passed by the learned Chief Judicial Magistrate rejecting his application for further investigation Under Section 173(8) Code of Criminal Procedure with respect to one another Accused namely Shri Bhaumik against whom no charge-sheet has been filed till date. Therefore, it is not at all appreciable how the Appellant against whom no relief is sought for further investigation has any locus and/or any say in the application for further investigation Under Section 173(8) Code of Criminal Procedure. How he can be said to be a necessary and a proper party. It is required to be noted that, as such, even the proposed Accused Shri Bhaumik shall not have any say at this stage in an application Under Section 173(8) Code of Criminal Procedure for further investigation.
When the proposed Accused against whom the further investigation is sought, namely Shri Bhaumik is not required to be heard at this stage, there is no question of hearing the Appellant-one of the co-Accused against whom the charge-sheet is already filed and the trial against whom is in progress and no relief of further investigation is sought against him. Therefore, the High Court is absolutely justified in rejecting the application submitted by the Appellant to implead him as a party Respondent in the Special Criminal Application.
Proceedings arising out of an application Under Section 173(8) Code of Criminal Procedure cannot be equated with the appeal or application against the order passed in criminal case as stated in Rule 51 - Rule 51 of the Gujarat High Court Rules has no application at all.
There is no substance in the present appeal and the same deserves to be dismissed - Appeal dismissed.
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2020 (3) TMI 1376 - CESTAT NEW DELHI
CENVAT Credit - input services - outdoor catering services - period pertains to 2009 to March, 2011 - non-production of records - appellant is an appeal against the impugned orders only on the ground that as the period pertains to 2009 to March, 2011 and now it is not possible for the appellant to produce those records as those records are not available with the appellant - HELD THAT:- Reliance is placed by the ld. Counsel in the decision of RELIANCE INDUSTRIES LTD. VERSUS UNION OF INDIA [2020 (1) TMI 283 - BOMBAY HIGH COURT] is not applicable to the facts of this case as in the said case the decision is with regard to adjudication to be done within one year from the amendment in Section 28 of the Customs Act, 1962 w.e.f. 29.03.2018. There is no such amendment in the Central Excise Act. Therefore, the said reliance is not applicable to the facts of the case.
Further, in normal course of business, an assessee is required to maintain their record for five years normally, but in case litigation is going on, the litigants are required to keep the records of the said period till litigation ends. In that circumstances, the plea taken by the appellant that the records pertains to more than five years, therefore, they are not able to produce the record. The said contention of the Ld. Counsel is not acceptable.
Appeal dismissed - decided against appellant.
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2020 (3) TMI 1375 - RAJASTHAN HIGH COURT
Grant of anticipatory bail - summon of petitioner directly through arrest warrant whereas the trial Court should have called the petitioner through bailable warrant - HELD THAT:- This anticipatory bail application filed on behalf of the petitioner under Section 438 Cr.P.C. deserves to be dismissed for the reasons; firstly, the revision petition challenging the order dated 21.01.2019 passed by the trial Court by which the petitioner was summoned through arrest warrant has already been dismissed by a Co-ordinate Bench of this Court in SANJAY SETHI S/O SHRI SWAROOP CHAND SETH VERSUS UMA NAND VIJAY ASSISTANT DIRECTOR, DIRECTORATE OF ENFORCEMENT [2020 (1) TMI 1524 - RAJASTHAN HIGH COURT].
Secondly, similarly situated co-accused have already surrendered before the trial Court after dismissal of their petitions by this Court as well as by the Hon’ble Supreme Court; thirdly, the petitioner is involved in serious economic offence, therefore, in the facts and circumstances of the present case, without expressing any opinion on the merits of the case, the petitioner is not enlarged on anticipatory bail under Section 438 Cr.P.C.
Anticipatory bail application dismissed.
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2020 (3) TMI 1374 - ITAT MUMBAI
Disallowance of "Deferred Payment Guarantee Commission" - HELD THAT:- we noticed that the Hon'ble ITAT has allowed the claim of the assessee on the basis of the earlier decision of the assessee's own case for the A.Y. 1994-95 & 1996-97. Nothing came into noticed that the finding has been changed and varied. Nothing contrary to the said finding has been produced before us, therefore, by following the decision of the Hon'ble ITAT in the assessee's own case for the A.Y. 1999-2000 bearing [2018 (1) TMI 1600 - ITAT MUMBAI], the claim of the assessee has been allowed.
Disallowance of depreciation on matured investments - HELD THAT:- As decided in own case [2018 (1) TMI 1600 - ITAT MUMBAI] the claim of the assessee has been allowed.
Disallowance of payments for scientific research - HELD THAT:- As we find that the issue has been decided by the CIT(A) on the basis of the decision of the Hon'ble ITAT in the assessee's own case for the A.Y. 1998-99 [2016 (4) TMI 1392 - ITAT MUMBAI]. Nothing came into noticed that the finding has been changed and varied. No law has been produced before us in support of any contention raised by assessee. Taking into account all the facts and circumstances and by relying upon the decision of the Hon'ble ITAT in the assessee's own case for the A.Y. 1999-2000, we decide this issue in favour of the revenue against the assessee.
Disallowance of expenses by applying the provisions of Section 14A r.w. Rule 8D - HELD THAT:- As decided in own case [2018 (1) TMI 1600 - ITAT MUMBAI] the claim of the assessee has been allowed as the loans granted and the investment made are out of own interest free funds available with the assessee's Bank. No disallowance in relation to interest expenses was warranted as own interest free fund are far exceeding investment.
Disallowance of depreciation on leased assets - HELD THAT:- Assessee has voluntary admitted this fact that this issue has been decided against assessee in the assessee's own case [2018 (1) TMI 1600 - ITAT MUMBAI].
Disallowance being payment to SBI Mutual Fund in respect of shortfall arising on redemption of Magnum Triple Scheme 1991 - HELD THAT: As decided in own case [2016 (4) TMI 1392 - ITAT MUMBAI] as relying on [2014 (1) TMI 1586 - KARNATAKA HIGH COURT] bank had set up in Mutual fund which had floated a scheme under which an assured return of income @ 12.5% was grante16the investors. But, at the time of redemption, the scheme did not have adequate assets nor funds to honor its commitment and consequently, in order to maintain the banks goodwill and reputation, the bank decided to repurchase of units of the scheme at a price at which mutual fund had committed to the investors. The bank claimed the said amount paid towards repurchase of the units as an expenditure - we are of the view that the CIT(A) has rightly allowed the claim of the assessee after discussion in detail as reproduced above - Decided in favour of assessee.
Disallowance of unearned income on non-performing assets as envisaged by Section 43D - HELD THAT:- On appraisal of the above mentioned finding, we find that this issue has already been remanded by Hon'ble ITAT on the basis of the earlier decision in the assessee's own case for the A.Y. 1997-98. Since the matter is already before the AO to decide afresh, therefore, we set aside the finding CIT(A) on this issue and restored the issue before the AO with direction to decide the matter and controversy afresh on similar guidelines which has been given by Hon'ble ITAT in the assessee's own case [2018 (1) TMI 1600 - ITAT MUMBAI].
Non-granting of deduction u/s 36(1)(vii) in respect of non-rural advances written-off as bad debts - HELD THAT:- As relying on the assessee's own case [2018 (1) TMI 1600 - ITAT MUMBAI] we set aside the finding of the CIT(A) on this issue and restored the issue before the AO to decide the matter of controversy afresh by giving an opportunity of being heard to the assessee.
Disallowance of contribution to SBI Retired Employees Medical Benefit Fund - HELD THAT:- As relying on the assessee's own case [2018 (1) TMI 1600 - ITAT MUMBAI] provisions of section 40A(9) should not make any harm to the expenditure incurred bonafide, that the contribution by the assessee bank was not disputed by the AO, stating that the same was not bonafide, that the funds were not controlled by the assessee banks, that the bonafide contribution made by the assessee as an employer was not hit by section 9 of section 40A of the Act. In the case under consideration, there is no doubt about genuineness of payment nor it is the case of the AO or FAA that Trust was not bonafide or the expenditure was not incurred wholly and exclusively for the employees - Decided in favour of assessee.
Disallowance of provisions for bad debts and doubtful debts u/s 36(1)(viia) - HELD THAT:- There is no dispute regarding the claim allowed by the AO is proper as per the provisions of section 36(1)(viia). When the allowable claim has been accepted by the AO under the provision of section 36(1)(viia) then merely the provision made on the basis of RBI guidelines does not become allowable for deduction in contravention of the provision of section 36(1)(viia). It is pertinent to note that when the claim of deduction specifically provided u/s 36(1)(viia) then the same cannot be allowed by applying any other provision. Accordingly, we do not find any merit or substance in the claim of the assessee. Hence dismissed.
Disallowance of provision in respect of foreign offices - HELD THAT:- Disallowance of provision in respect of foreign offices. Before us, the AR referred to note No.19, of the return of income and the letter submitted on 05.09.2000 along with the annexure which form part of the Paper book. We are of the opinion that the issue needs further verification. Therefore, matter is restored back to the file of AO for fresh adjudication, who would decide the case after hearing the assessee. Thus In view of the decision of Hon'ble ITAT in the assessee's own case for the A.Y. 1999-2000, we set aside the finding of the CIT(A) on this issue and restored the issue before the AO to decide the matter of controversy afresh by following the direction given.
Disallowance of recovery of bad debts written off should not be liable to tax u/s 41(4) - HELD THAT:- As decided in own case [2014 (1) TMI 1887 - ITAT MUMBAI] we restored this issue before the AO to decide the matter of controversy afresh by giving an opportunity of being heard to the assessee in accordance with law by following the similar guidelines.
Disallowance earned from foreign branches not taxable in India - HELD THAT:- As decided in own case [2014 (1) TMI 1887 - ITAT MUMBAI] we decide this and restore this issue before the AO to decide the matter of controversy afresh by giving an opportunity of being heard to the assessee in accordance with law on similar lines.
Disallowance on reservation of seats in the school for children of the bank officers - revenue has argued that the CIT(A) has wrongly allowed the claim of the assessee, therefore, the finding of the CIT(A) is not justifiable, hence, is liable to be set aside - HELD THAT:- CIT(A) has decided the issue on the basis of the decision of the CIT(A) in favour of the appellant in its own case for the A.Ys. 1997- 98 & 1998-99. The said order was followed by the CIT(A) for the A.Y. 1999-2000[2018 (1) TMI 1600 - ITAT MUMBAI],. Subsequently, the Hon'ble ITAT has also decided the issue for the A.Y. 1992-93 to 1995-96. Since the matter of controversy has already adjudicated by the Hon'ble ITAT in the assessee's own case for the A.Y. 1992-93 & 1995-96 in the assessee's favour and there is no change of the decision, therefore, we are of the view that the CIT(A) has rightly and correctly decided the issue in favour of the assessee against the revenue. Accordingly, these issues are decided in favour of the assessee against the revenue.
Addition made on account of interest on securities on accrual basis as the assessee followed mercantile system of accounting - HELD THAT:- CIT(A) has decided the issue in favour of the assessee on the basis of the decision of the Hon'ble ITAT Jaipur Bench in the case of State Bank of Bikaner & Jaipur Vs. DCIT [1998 (10) TMI 93 - ITAT JAIPUR]. The issue has already been decided in favour of the assessee against the revenue in the earlier A.Y. 1997-98 by the predecessor of the CIT(A) who pass the present order. In view of the above said decision the CIT(A) has decided the issue in favour of the assessee.
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2020 (3) TMI 1373 - SUPREME COURT
Jurisdiction - whether the High Court in exercise of its Constitutional jurisdiction conferred under Article 226 of Constitution of India can pass an order interdicting a legal fiction engrafted in a State enactment? - HELD THAT:- Before the Full Bench of the Bombay High Court as well as the Three Judge Bench of this Court in SHANKAR VERSUS STATE OF MAHARASHTRA AND ORS. [2018 (8) TMI 2058 - SUPREME COURT], the issue as to whether the High Court has jurisdiction under Article 226 to stay the consequences of deeming provision was neither considered nor answered. We may clarify that in event there are no orders staying the consequences of deeming fiction as envisaged in proviso to Section 5B, the election shall automatically stand terminated retrospectively but in the present case in the facts of both the appeals, the consequences of deeming fiction as contained in second proviso to Section 5B were stayed/interdicted by order of the High Court, hence the retrospective termination could not take place.
From the preposition laid down by this Court in Bihar Public Service Commission and Another Vs. Dr. Shiv Jatan Thakur and Others [1994 (7) TMI 374 - SUPREME COURT], it is clear that such interim direction can be passed by the High Court under Article 226, which could have helped or aided the Court in granting main relief sought in the writ petition. In the present case, the decision of the Caste Scrutiny Committee having been challenged by the writ petitioners and the High Court finding prima facie substance in the submissions granted interim order, which ultimately fructified in final order setting aside the decision of the Caste Scrutiny Committee. The interim order, thus, passed by the High Court was in aid of the main relief, which was granted by the High Court.
The provision of Section 11A of the Land Acquisition Act, which provides for the period within which an award shall be made contains a legislative scheme in reference to the Land Acquisition Act, 1894, the Explanation to Section 11A providing that in computing the period of two years referred to in Section 11A, the period during which any action or proceeding to be taken in pursuance of said declaration is stated by an order of the Court shall be excluded. Section 11A is a legislative scheme in reference to Land Acquisition Act, which provision is entirely different and does not lend any support to the submission made by the learned counsel for the appellant.
There is no fetter in the jurisdiction of the High Court in granting an interim order in a case where caste claim by respondents was illegally rejected before the expiry of period of six months and the High Court granted the interim order before the expiry of period of six months. In the facts of the present case, the deeming fiction of retrospective termination of the election could not come in operation due to the interim order passed by the High Court, hence deeming fiction under Section 5B second proviso never came into existence to retrospectively terminate the election of the respondent.
It is thus concluded as follows:
(i) Section 5B of the Mumbai Municipal Corporation Act does not oust the jurisdiction of High Court under Article 226 of the Constitution.
(ii) The High Court in exercise of jurisdiction under Article 226 of the Constitution can pass an order interdicting the legal fiction as contemplated under second proviso to Section 5B, provided the legal fiction had not come into operation.
(iii) The interim order dated 18.08.2017 in Writ Petition No.2269 of 2017 as well as the impugned final judgment dated 02.04.2019 were not beyond the jurisdiction of High Court under Article 226 of the Constitution.
(iv) The interim order dated 22.08.2017 and final judgement dated 02.04.2019 in Writ Petition No.145 of 2018 were not the orders beyond the jurisdiction of High Court under Article 226 of the Constitution.
Appeal dismissed.
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2020 (3) TMI 1372 - ITAT MUMBAI
Income accrued in India - Addition on account of “interest income on securities- including T bills” - India-Mauritius Tax Treaty - Satisfaction of “beneficial ownership” requirement - treaty protection under article 11(3) of the India Mauritius Double Taxation Avoidance Agreement - HELD THAT:- As decided in assessee's own case [2018 (7) TMI 2122 - ITAT MUMBAI] CBDT Circular no. 789 dated 13.04.2000 (supra) is specifically in the context of incomes by way of dividend and capital gain on sale of shares. So, however, in our considered opinion, it would equally apply even in the situation before us where the application of the provisions of the India-Mauritius Tax Treaty is sought to be applied for considering the taxability of interest income as per Article 11(3)(c) of the India- Mauritius Tax Treaty - even in the context of the impugned interest income, Circular no. 789 dated 13.04.2000 (supra) of the CBDT is applicable while applying the provisions of Article 11(3)(c) of the India-Mauritius Tax Treaty. On this aspect itself we uphold the plea of the assessee that assessee is the 'beneficial owner' of the impugned interest income on the strength of the Tax Residency Certificate issued by the Mauritian authorities. - Decided in favour of assessee.
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