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2023 (12) TMI 1408
Revision u/s 263 - assessee has surrendered income on discrepancies found during the course of survey action - AO treated the surrender amount as the business income of the assessee - AR submitted that the case of the assessee was selected for compulsory scrutiny only on the issue of the amount surrendered during the course of survey action - HELD THAT:- During the course of assessment proceedings, the AO in the notice issued u/s 142(1) has asked the assessee to show-cause why the surrendered income in terms of excess stock of Rs 40 lacs and excess cash of Rs 10 lacs found during the course of survey may not be brought to tax under the deeming provisions r.w.s. 115BBE. In response to the notice so issued, the assessee has filed his submission stating that he has surrendered the excess stock and cash which is related to his business and offer of surrender was accepted by the department team at the time of survey and pursuant thereto, the assessee has not back tracked from his offer and has paid taxes as per law prevailing on the date of survey and this income was duly shown in income tax return and duly reported for tax purposes.
AO taking cognizance of the findings of the survey team, the documents found during the course of survey, the statement of the assessee, and the return of income and after examination thereof and due application of mind, has accepted the explanation so offered by the assessee and the returned income was accepted wherein the surrendered income has been offered under the head business income. We therefore find that the assessee has been asked specific questions during the course of assessment proceedngs, after due examination and being satisfied with the explanation of the assessee, the same has been accepted and thus, it is not a case of lack of enquiry on part of the AO or for that matter, accepting the explanation of the assessee on face value. The AO has duly enquired in the matter and thereafter, has taken a view in the matter.
No doubt, these transactions were not recorded at the time of survey thus qualify as unrecorded transactions satisfying one of the essential conditions, at the same time, the assessee has provided the necessary explanation about the nature and source of such unrecorded transactions and the necessary nexus with assessee’s business has been established, thus, it cannot be said that these are unexplained transactions thus, doesn’t satisfy the second condition for invoking the deeming provisions of the Act. Thus, the view taken by the AO is clearly a plausible view considering the facts and circumstances of the present case and nothing has been pointed out as to how the view so taken is unsustainable in the eyes of law.
The order so passed by the AO cannot be held as erroneous due to lack of inquiry or for that matter requisite inquiry on the part of the AO.
As we have held above, there is no findings recorded by the Ld. Pr. CIT as to how the deeming provisions are applicable in the instant case and the order so passed by the AO is erroneous. We therefore find that merely stating that there was survey operation at the business premises of the assessee and provisions of Section 115BBE of the Act are attracted, the same can be a basis for exercise of jurisdiction u/s 263 of the Act. In view of the same, order so passed by the Ld. Pr. CIT under section 263 is set aside and that of the AO is restored. Assessee appeal allowed.
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2023 (12) TMI 1407
Calculation of duty demand for the period from 2002-03 till 8-9-05 - Eligibility for CENVAT Credit and Input Duty Credit - HELD THAT:- It was held by CESTAT that 'While the Appellants are certainly liable to penal action for not taking Excise Registration and not submitting the periodical returns from time to time and for not maintaining the prescribed registers, it would be necessary to take a liberal view in their case and allow them the small-scale exemption, computation on the basis of cum-duty price and set-off against the CENVAT Credit on the invoices issued by public sector suppliers subject to being available for verification.'
There are no manifest error of law in the impugned order of the Tribunal. No substantial question of law is involved. Therefore, the appeal is dismissed.
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2023 (12) TMI 1406
Levy of tax and Penalty - whether mere expiration of e-Way Bill during the course of transportation could attract the wrath of Section 129, read with Rule 138 of the Act and Rules of 2017, and if at all, the same could attract penalty in terms thereof? - HELD THAT:- Recently the issue at hand was decided by the Allahabad High Court in Sleevco Traders through Its Proprietor Shri Alok Gupta [2022 (5) TMI 845 - ALLAHABAD HIGH COURT]. The High Court after taking into consideration the fact and the circumstances in which the e-Way bill expired, held that “there is neither any intention to evade payment of tax nor any fraud nor any contravention of the Act, as valid documents were accompanying with the goods as required under the Act”.
The aforesaid order was challenged by the Revenue before the Hon’ble Apex Court in ADDITIONAL COMMISSIONER GRADE-2 (APPEAL) FIFTH COMMERCIAL TAX & ANR. VERSUS M/S SLEEVCO TRADERS [2023 (7) TMI 418 - SC ORDER] and the Hon’ble Apex Court dismissed the appeal of the State inter alia holding as “This Court is of the opinion that there is no infirmity in the judgment of the High Court, which is correctly appreciated”.
Admittedly; in the instant case, the revenue has not taken into consideration the fact that because of denial of permission to enter into Adityapur Industrial Area due to the festive season (Deepawali), the vehicle (Truck) was bound to stop for some time, as a result of which the validity of the e-Way Bill expired. It is also admitted fact that the truck was within 1 KM of the Industrial Area and not far, thus it is evident that the expiry of e-Way Bill due to aforesaid reason should not and cannot amount to intention of evasion of tax and therefore, no extent of penalty would arise.
This Court in similar facts and circumstance in the case of Rivigo Services Private Limited Versus The State of Jharkhand & Ors. [2022 (11) TMI 391 - JHARKHAND HIGH COURT] had quashed and set aside the order passed by the revenue and remanded the matter back to the authorities for fresh consideration.
Inasmuch as, there is neither any intention to evade payment of tax nor any fraud has been committed and valid documents were accompanying with the goods as required under the Act; save and except, the E-Way Bill which had expired by few hours and this Court cannot ignore the fact that the vehicle was intercepted very near to the Check-Post and as stated by the petitioner and not controverted by the Revenue that it was the festive season of Diwali.
Conclusion - The mere expiration of an e-Way Bill, without intent to evade tax, does not justify the imposition of penalties under Section 129.
The petitioner had already paid the penalty; interest of justice would be sufficed by allowing the petitioner to claim for refund and if any such application for refund is preferred; the competent authority shall consider the same within a period of 8 weeks from the date on which such application is made and refund be effected, if there are no other legal impediment - Application allowed.
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2023 (12) TMI 1405
Profiteering - construction projects - benefit of Input Tax Credit (ITC) not passed on to the buyers - contravention of Section 171 of the Central Goods and Services Tax Act, 2017 - HELD THAT:- It is observed that the DGAP report dated 15.02.2023 in respect of both the projects is incomplete. Accordingly, the DGAP is directed to re investigate both the above projects viz 'Omkar 1973 Worli' and 'The Summit Business Bay' under Rule 133(4) of the above Rules and submit complete report accordingly. The Respondent No. 1 is also directed to supply the required information to the DGAP promptly.
Conclusion - i) The additional benefit of ITC in the GST regime is required to be passed on by the suppliers to the recipients by way of commensurate reduction in price, in terms of Section 171 of GST Act, 2017. ii) Reinvestigation directed by the DGAP to address identified discrepancies and ordered the Respondent No. 1 to provide complete documentation.
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2023 (12) TMI 1404
Profiteering - Construction Service supplied by the Respondent - it is alleged that the Respondent had not passed on the benefit of ITC to her by way of commensurate reduction in the price of the flat purchased from the Respondent - contravention of Section 171 of the CGST Act, 2017 - HELD THAT:- The Commission finds that the matter needs to be sent back to DGAP under Rule 133(4) of the CGST Rules, 2017 for re-investigation on the following issues:
i. Whether Smt. Sudha has received the benefit of ITC due to the settlement made by her with the Respondent as a consequence of which she has withdrawn her complaint?
ii. Whether some of the flats constructed by the Respondent fell under the 'Affordable Housing Scheme' and whether GST was to be charged on those flats @ 8%?
iii. To consider the claim of the Respondent regarding cancellation of flats/units in the project and calculate the profiteering accordingly.
iv. Verification of the 'passing on of ITC benefit' to homebuyers/customers be carried out afresh.
Conclusion - The DGAP is directed to submit a fresh investigation report under Rule 133(4) of the CGST Rules, 2017 on all the issues mentioned.
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2023 (12) TMI 1403
Condonation of delay of 21 days in filing the appeal before the first respondent/Appellate Authority - time limit for filing an appeal - HELD THAT:- This Court finds that since the order dated 30.03.2023 passed by the second respondent has provides 3 months time for preferring appeal, the petitioner was under the wrong impression that they can file the appeal within 3 months plus 30 days in addition, (in the event of any delay) from the date of receipt of the order 30.03.2023. But, however, the Act only provides for 2 months, which is exclusive of one month grace time for the delay, if any. Therefore, reasons assigned by the petitioner for preferring the Appeal with delay is appears to be genuine and reasonable, inasmuch as, the petitioner got confused over the time limit prescribed under the Statute, (which is only two months) and the time limit prescribed by the second respondent/Authority which is three month's, inclusive of one month delay period. Therefore, this Court is inclined to set aside the impugned order dated 27.09.2023.
Conclusion - This Court finds that since the order dated 30.03.2023 passed by the second respondent has provides 3 months time for preferring appeal, the petitioner was under the wrong impression that they can file the appeal within 3 months plus 30 days in addition.
The impugned order is set aside and the first respondent is directed to take the Appeal on record and dispose of the Appeal on merits.
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2023 (12) TMI 1402
Challenge to assessment orders for the financial years 2013-14 to 2017-18 under the CGST and SGST Acts - assessment orders were passed without granting sufficient time to him to furnish the balance 'C' Form and denying the concessional rate of tax - violation of principles of natural justice - HELD THAT:- The 2nd respondent, at the time of consideration of the stay application, prima facie found that the appellant could not produce any documents to substantiate his contention that he is entitled to concessional rate of tax. In the said circumstances, the 2nd respondent chose to impose the condition while granting stay. The tax liability comes to more than ₹ 45,00,000/-. There are no illegality in the order of the 2nd respondent imposing a condition to grant stay.
Appeal dismissed.
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2023 (12) TMI 1401
Challenge to action of the respondents in realising the service tax arrears under the Finance Act, 1994 in terms of Section 87(b) by issuing a garnishee order - HELD THAT:- The 5th respondent had already withdrawn an amount of ₹ 1,30,64,178/- from the bank account of the appellant held with the said bank and paid to the 2nd respondent. The balance outstanding under the garnshiee order is ₹ 68,01,439/-. The learned standing counsel for the appellant submitted that the appellant does not have enough funds with them and they cannot mobilise the balance amount in five instalments as directed. The learned standing counsel for respondents 1 to 3 formally objected to the grant of more instalments albeit conceding that Ext.P4 circular allowed for the grant of more instalments. Considering the rival submissions, the appellant can be granted twelve instalments as against five instalments granted by the learned Single Judge to discharge the outstanding service tax and interest. The first instalment of ₹ 15,00,000/- can be deducted by the 4th respondent from the amount lying in the appellant's bank account as directed by the learned Single Judge. The appellant shall pay the balance amount in twelve equal instalments starting from 1st February, 2024.
Appeal disposed off.
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2023 (12) TMI 1400
Maintainability of petition - availing statutory remedy of appeal against the impugned order - non-constitution of the Tribunal - HELD THAT:- The respondent State authorities have acknowledged the fact of non-constitution of the Tribunal and come out with a notification bearing Order No. 09/2019-State Tax, S. O. 399, dated 11.12.2019 for removal of difficulties, in exercise of powers under Section 172 of the B.G.S.T Act, which provides that period of limitation for the purpose of preferring an appeal before the Tribunal under Section 112 shall start only after the date on which the President, or the State President, as the case may be, of the Tribunal after its constitution under Section 109 of the B.G.S.T Act, enters office.
Subject to deposit of a sum equal to 20 percent of the remaining amount of tax in dispute, if not already deposited, in addition to the amount deposited earlier under Sub-Section (6) of Section 107 of the B.G.S.T. Act, the petitioner must be extended the statutory benefit of stay under Sub-Section (9) of Section 112 of the B.G.S.T. Act. The petitioner cannot be deprived of the benefit, due to non- constitution of the Tribunal by the respondents themselves.
Petition disposed off.
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2023 (12) TMI 1399
Levy of GST on various fees collected by Tamil Nadu Nurses and Midwives Council, a Government Authority - opportunity of hearing not provided - violation of principles of natural justice - HELD THAT:- The rejection of application for advance ruling in the instant case stems from the fact that an investigation initiated by DGGI against the appellant is pending on the same issue. This being the case, the advance ruling authority ought to have shared the new findings of DGGI that was lying before them, and discussed the same in detail, either during the personal hearing, or thereafter, before proceeding to finalise the case.
The principles of natural justice have not been followed in the instant case, since the advance ruling authority had erred in not sharing the documents and comments forwarded by DGGI, with the appellants. Accordingly, justice will be met by restoring the application for advance ruling to its original position, by way of remanding the case to the lower authority, with a direction to forward the letter dated 28.07.2022 of DGGI along with its enclosures to the appellant enabling them to comment on the same, and to offer them another opportunity of personal hearing before deciding the case as per the provisions of law.
Conclusion - The principles of natural justice have not been followed in the instant case, since the advance ruling authority had erred in not sharing the documents and comments forwarded by DGGI, with the appellants.
The matter is remanded to the Lower Authority for consideration and passing of appropriate orders, after following the principles of natural justice.
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2023 (12) TMI 1398
Maintainability of petition - availability of alternative remedy - Challenge to penalty orders under Section 129 of the CGST/SGST Act, 2017 - HELD THAT:- Admittedly, the petitioner has the remedy of filing an appeal against the said order. Instead of filing the statutory appeal, the petitioner has approached this Court in the present writ petition. As the petitioner has an efficacious alternate remedy to file a statutory appeal, this Court does not entertain the present writ petition.
Petition disposed off.
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2023 (12) TMI 1397
Quashing of order passed u/s 74 of the GST Act on the ground that the petitioners are liable to pay GST on the amount of discount received by it on purchase of the motor vehicles contrary to the circular issued by Central Board of Indirect Taxes and Customs and the appellate orders passed under similar provisions under the Finance Act - HELD THAT:- When the matter was taken up for passing the order, it was found that the appellate order relied upon by the petitioners is under challenge before the CESTAT. In such circumstances, the petition is required to be kept pending till the CESTAT decides such issue.
Issue Rule returnable on 30th April, 2024. Ad interim granted earlier to continue as interim relief till the final disposal of this petition.
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2023 (12) TMI 1396
Denial of ITC - imported goods or not - HELD THAT:- Considering the facts and circumstances of the case and submission of the parties and in view of the instruction dated 20th December, 2023, this writ petition is disposed of by setting aside the impugned adjudication order dated 16th August, 2023 by directing the adjudicating authority concerned of the State GST, to pass a fresh adjudication order, within two weeks from the date of receipt of such order and allow the claim of ITC in accordance with law.
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2023 (12) TMI 1395
Cancellation of petitioner’s GST registration - petitioner has not filed returns for a continuous period of six weeks - non-application of mind - violation of principles of natural justice - HELD THAT:- It is seen from the impugned order that while the second respondent has referred to the petitioner’s purported reply dated 12.12.2022, in the very next sentence, the second respondent has also recorded that no reply is filed to the Show Cause Notice. The non-application of mind is obvious and therefore there must be interference quashing the cancellation of the petitioner’s GST registration but on terms.
The second respondent’s impugned order dated 30.12.2022 is quashed but on the condition that the petitioner shall file necessary declarations, if not already filed, and discharge of dues within the period of four [4] weeks from the date of receipt of a certified copy of this order - Petition allowed.
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2023 (12) TMI 1394
Maintainability of petition - availability of statutory remedy of appeal - non-constitution of the Tribunal - HELD THAT:- The respondent State authorities have acknowledged the fact of non-constitution of the Tribunal and come out with a notification bearing Order No. 09/2019-State Tax, S. O. 399, dated 11.12.2019 for removal of difficulties, in exercise of powers under Section 172 of the B.G.S.T Act, which provides that period of limitation for the purpose of preferring an appeal before the Tribunal under Section 112 shall start only after the date on which the President, or the State President, as the case may be, of the Tribunal after its constitution under Section 109 of the B.G.S.T Act, enters office.
Subject to deposit of a sum equal to 20 percent of the remaining amount of tax in dispute, if not already deposited, in addition to the amount deposited earlier under Sub-Section (6) of Section 107 of the B.G.S.T. Act, the petitioner must be extended the statutory benefit of stay under Sub-Section (9) of Section 112 of the B.G.S.T. Act. The petitioner cannot be deprived of the benefit, due to non- constitution of the Tribunal by the respondents themselves. The recovery of balance amount, and any steps that may have been taken in this regard will thus be deemed to be stayed.
Petition disposed off.
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2023 (12) TMI 1393
Addition made 56(2)(viib) on account of share premium received of allotment of shares - valuation of the Shares made by Technical Expert as required under Rule 11DA of the Income Tax Rules - HELD THAT:- The assessee has taken the DCF method for valuation of share which is followed by the Rule 11UA the Rule. However, there is no dispute between the parties that Rule 11UA(1) is not applicable on the facts and circumstances of the present case which is a provision of general nature whereas Rule 11UA(2) is a specific provision providing for the valuation of the unquoted equity shares.
After going through the relevant Section and the Rules, in our opinion, the matter of valuation of unquoted equity shares, has been completely left to the discretion of the assessee. It is his option whether to choose NAV Method (Book Value) under clause (a) or to choose DCF Method under clause (b) and the AO cannot adopt a method of his own choice.
We relied on the order of Crown Chemicals [2022 (12) TMI 1552 - ITAT MUMBAI], Hometrail Buildtech (P.) Ltd [2023 (9) TMI 797 - ITAT DELHI] and Nabh Multitrade Pvt. Ltd., [2020 (10) TMI 928 - ITAT JAIPUR] We find that the assessee valued the share amount to Rs. 158/- per share and allotted share is Rs.100 which is much less than the NAV which is not contravening of section 56(2) of the Act. Further, all the investment in equity shares are accumulated from the directors and son of director. So, the addition in related to contravening of section 56(2) is not justified. Accordingly, we set aside the appeal order.
Addition u/s 68 - non-furnishing of the identity and PAN of the creditors - HELD THAT:- The assessee was unable to substantiate its claim before the revenue authorities. Accordingly, we remit back the matter to the file of the CIT(A) for adjudication afresh.
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2023 (12) TMI 1392
Unexplained income u/s 68 r.w. section 115BBE - cash deposit post demonetization - Onus to prove - AO referred to the cash deposits made by the assessee in the month of October and November and compared to the last two years and held it to unreasonably high - HELD THAT:- Source of such cash deposits has been explained by the assessee as out of its cash sales so undertaken from time to time and it has also been explained that such cash sales are subject to VAT where VAT has been collected and deposited with the government treasury.
Assessee has furnished the cash book containing the entries towards the cash sales, cash deposits with bank, complete sale and purchase ledgers, sundry creditors, VAT returns, copy of trading and profit/loss account and balance sheet which are duly audited. No defect has been pointed out by the AO in terms of availability of stock or in any of the documentation so submitted by the assessee or in the books of accounts.
Merely the fact that certain cash deposits have been made by the assessee during the period of demonization and such deposits are on a higher side considering the past year figures cannot be basis to hold the explanation so made by the assessee as unsustainable and treat the cash sales as bogus and bringing the cash deposits to tax u/s 68 of the Act.
The comparative figures for past years can no doubt provides a starting point for further examination and verification but basis such comparative analysis alone and without any further examination which points out any defect or manipulation in the documentation so submitted or in terms of availability of requisite stock in the books of accounts, the sales so undertaken by the assessee which is duly recorded in the books of accounts cannot be rejected and treated as bogus. Decided in favour of assessee.
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2023 (12) TMI 1391
Challenge to summons issued under Section 70 of the Central Goods and Services Tax Act 2017 directing the petitioner through its proprietor to tender oral evidence - HELD THAT:- Let the petitioner appear before the designated officer on 23 January 2024 at 2.30 p.m.
Petition disposed off.
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2023 (12) TMI 1390
Application under section 30(6) of the Insolvency and Bankruptcy Code, 2016, after approval of the resolution plan by the Committee of Creditors - HELD THAT:- On perusal of the documents on record, it is satisfied that the Resolution Plan is in accordance with sections 30 and 31 of the IBC and also complies with regulations 38 and 39 of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016.
Hon’ble Supreme Court in Ghanashyam Mishra and Sons Pvt Ltd v Edelweiss Asset Reconstruction Company Ltd, [2021 (4) TMI 613 - SUPREME COURT] has held that once a resolution plan is duly approved by the Adjudicating Authority under sub-section (1) of section 31, the claims as provided in the resolution plan shall stand frozen and will be binding on the Corporate Debtor and its employees, members, creditors, including the Central Govt, any State Govt or any local authority, guarantors and other stakeholders.
The Resolution Plan approved by CoC and being approved by this Adjudicating Authority shall be binding on the Corporate Debtor and other persons, authorities etc. as specified in section 31 of the Code.
Application disposed off.
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2023 (12) TMI 1389
Impleadment of the Respondent No. 2, Builders Association of India, in an ongoing proceeding to investigate allegations of cartelisation and price manipulations of Grey Cement Manufacturers - inspection of non- confidential records - power of CCI to review - failure to satisfy the conjunctive two-fold test given under Regulation 25 of ‘substantial interest’ and ‘public interest’ - Ultra vires action of Section 57 of the Competition Act - ex-parte - violation of principles of natural justice.
Impleadment of the Respondent No. 2, Builders Association of India, in an ongoing proceeding to investigate allegations of cartelisation and price manipulations of Grey Cement Manufacturers - HELD THAT:- During the process of enquiry by the Commission, Regulation 25 of the General Regulations 2009 allows the Commission the power to permit a person or enterprise to take part in proceedings given that they have a substantial interest attached to the outcome of the proceedings and that allowing them to take part is seen as a necessity in view of public interest.
It is contended by the Petitioner that the Order dated 05.07.2023 to implead BAI as a party to the proceedings under Suo Moto Case No. 2 of 2019 is improper as it fails to satisfy the conjunctive two-fold test given under Regulation 25 of ‘substantial interest’ and ‘public interest’ and that in absence of its satisfaction as reflected in the inadequacy of reasoning given in the impugned Order dated 05.07.2023 to that effect, the actions of the CCI in impleading BAI are illegal and unacceptable cannot be accepted.
Exercise of jurisdiction under Aricle 227 of the Constitution - HELD THAT:- It is trite law that Writ Courts while exercising its jurisdiction under Article 227 of the Constitution of India do not substitute the opinions arrived at by statutory bodies with their own, unless the decision arrived at by the statutory bodies are beyond their jurisdiction or there is a failure to exercise jurisdiction vested in them or the order passed is so perverse and illegal that it finds itself in contravention of Wednesbury principles. The nature and scope of the jurisdiction under Article 226 of the Constitution of India has been crystallised in several judgements of the Supreme Court.
The Apex Court in STATE OF PUNJAB AND ORS. VERSUS MEHAR DIN [2022 (3) TMI 1622 - SUPREME COURT], has held that 'The law on the subject is settled that the Courts being the custodian of fundamental rights are under an obligation to interfere where there is arbitrariness, irrationality, unreasonableness, malafides and bias, if any, but at the same time, the Courts should exercise the power of judicial review with a lot of restraint, particularly in contractual and commercial matters.'
In Bank Of India And Anr v. Degala Suryanarayana, [1999 (7) TMI 703 - SUPREME COURT], the Supreme Court has held that 'The Court exercising the jurisdiction of judicial review would not interfere with the findings of fact arrived at in the departmental enquiry proceedings excepting in a case of malafides or perversity i.e., where there is no evidence to support a finding or where a finding is such that no man acting reasonably and with objectivity could have arrived at that finding. The Court cannot embark upon reappreciating the evidence or weighing the same like an appellate authority. So long as there is some evidence to support the conclusion arrived at by the departmental authority, the same has to be sustained.'
In the present case, the impugned Order passed under Regulation 25 of the General Regulations 2009, also brings attention to the submissions made by BAI ,including considerations and records of BAI as an association with the largest consumers of cement - In view of the settled position of law, this Court is not inclined to substitute its conclusion to the one arrived at by the Board which is based on the material on record before the Commission.
The allegation of the Petitioner that the impugned order dated 05.07.2023 is devoid of adequate reasoning towards the satisfaction of the requirements under Regulation 25 of the General Regulations 2009 and it is, therefore, unreasoned cannot be accepted.
Principles of natural justice - Petitioner alleges that the requirements under Section 36 of the Act, which mandates that procedures followed by CCI ought to be in consonance with the principles of natural justice, were not followed in the present case as the impugned order dated 05.07.2023 was passed by CCI ex-parte - HELD THAT:- It is contended that the Petitioner was neither given due notice of the consideration of making BAI a party as under Regulation 25 of the Competition Regulation 2009 nor were they presented an opportunity of being heard before the impleadment of a third party to the Suo Moto Case No. 2 of 2019. The allegations of the Petitioner ought to be weighed here on the pointed question as to whether fulfilment of requirements under principles of natural justice were or were not followed in the present case, that is, whether there exists any procedural fallacy which renders the impugned Order dated 05.07.2023 improper and invalid in law.
It is, therefore, a reiteration of the well-established principle that a fair procedure very much includes the presentation of an appropriate notice to all involved parties. However, the contention of the Petitioner that such a notice was not provided to the Petitioner prior to the passing of the impugned Order dated 05.07.2023 by the CCI cannot by accepted by this Court.
Power of CCI to enquire into agreements - abuse of dominant position - HELD THAT:- The CCI has the power to enquire into agreements and dominant position of enterprises under Section 19 of the Act and the procedure for the same is given under Section 26 of the Act read with Regulation 21 under the General Regulations 2009. The nature of the proceedings under the ambit of this Act vis-à-vis the parties and their involved interests thereof was noted by the Apex Court in Samir Agarwal v Competition Commission of India, [2020 (12) TMI 621 - SUPREME COURT] where it was held that 'given the context of the Act in which the CCI and the NCLAT deal with practices which have an adverse effect on competition in derogation of the interest of consumers, it is clear that the Act vests powers in the CCI and enables it to act in rem, in public interest.'
The power to review the orders of CCI, which were given under Section 37 of the Act, had subsequently been repealed by the Competition Amendment Act, 2007. The Petitioner contents that the impugned Order accepting the impleadment application of BAI dated 05.07.2023 is a review of the previous Order dated 29.12.2021 whereby CCI had rejected the initial impleadment application of BAI.
Ultra vires action of Section 57 of the Competition Act - HELD THAT:- The impugned Order passed by CCI does not ensue the grant of confidential records of proceedings to BAI. Moreover, it is also clear that the grant of non-confidential information is also explicitly recorded to be done within the bounds of Regulation 37(1) which can only be exercised subject to conformity with the safeguards enumerated within Section 57 of the Act and Regulation 35 of the General Regulations 2009 as noted above. The contention of the Petitioner that adequate safeguards under Section 57 have been ignored by CCI in its passing of the impugned Order cannot be accepted by this Court. The requisite procedural provisions on sharing information with parties to the proceedings have been duly paid attention to and followed by CCI as far as the impugned Order dated 05.07.2023 challenged in the present Writ is concerned.
It is evident that the stage at which compensation under Section 53N can be invoked is that of an Appellate Stage, post the final orders of CCIin any proceedings initiated before it. Therefore, at the present stage of proceedings in the Suo Moto Case No. 2 of 2019, invoking Section 53N is neither an option for the Petitioner, nor is there any reason to prefer an application for compensation when there exists a carved out provision in the form of Regulation 25 which allows the party to take part in the proceedings before the CCI after its satisfaction. The fact that the proceedings under the Competition Act apply in rem is of no consequence when the CCI is adjudicating the allegations regarding the cartelization and price manipulation.
Conclusion - The court upheld the CCI's decision to implead BAI, finding no violation of procedural fairness or statutory provisions - Petition dismissed.
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