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Showing 301 to 320 of 1430 Records
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2023 (12) TMI 1130
Revision u/s 263 - Tribunal upheld the order passed by the Principal Commissioner of Income Tax, in directing the Assessing Officer to recompute the taxable capital gain u/s 54F and pass revised assessment order, after providing opportunity to the assessee - as submitted on the side of the appellant / assessee that the appeal filed against the order of assessment passed by the Assessing Officer is pending adjudication before the appellate authority - HELD THAT:- This court is of the view that the parties need not agitate the factual matrix in this appeal and it would be appropriate to raise all the grounds raised herein before the appellate authority, with whom the appeal is pending, in order to avoid multiplicity of proceedings.
Substantial questions of law involved herein are left open to be decided by the appellate authority with whom the appeal against the assessment order passed under section 144 is pending. Accordingly, the appellate authority shall consider the same along with the grounds raised in the appeal and pass appropriate orders, on merits and in accordance with law, after providing due opportunity of personal hearing to the appellant / assessee, without being influenced by any of the observations made by the Tribunal, within a period of twelve (12) weeks from the date of receipt of a copy of this judgment. The appellant / assessee is at liberty to raise all the grounds before the appellate authority with supportive materials, at the time of personal hearing.
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2023 (12) TMI 1129
Reopening of assessment u/s 147 - petitioner has failed to support documentary evidence regarding the purchase of immovable property and the post office deposit - HELD THAT:- Petitioner is categorical that he has not participated in any sale transaction or availed the benefit of the deposit with the Post Office in the subject assessment year to be served with notice under Section 148A[b] of the IT Act. Secondly, the petitioner asserts that because of his peculiar circumstances he had no knowledge of the notice and as such, he has not filed any response to the notice issued u/s148A[b]. Thirdly, when a show cause notice under Section 142[1] of the IT Act is issued, the petitioner has responded asking for details and an opportunity of hearing. This Court must further observe that the necessary details will be provided when notice under Section 148A[b] of the IT Act is issued, but the notice under Section 148A[b] of the IT Act in the present case does not contain all the necessary details, and it could be that such information could not be sought for at the stage of Section 144B of the IT Act but an opportunity of hearing is contemplated at this stage under these provisions.
The petitioner has not received the notice under Section 148A[b] of the IT Act and an opportunity of personal hearing is not extended before the impugned assessment order, and therefore, this Court must opine that there is a definite lack of opportunity and failure to comply with the requirements of putting the assessee on notice for reasons to commence proceedings under Section 148 of the IT Act.
As such, there must be interference quashing the assessment order dated 13.03.2023 and the adjudication order dated 28.03.2022 u/s 148A[d] and restoring the proceedings to the stage where the petitioner could show cause against adjudication under Section 148A[d] - Further, the second respondent must be called upon to furnish to the petitioner information such as the details of the sale deed and the deposits with the postal department upon receipt of a certified copy of this order with due opportunity to the petitioner to file a response.
The petition is allowed in part. The impugned assessment order and the consequential computation, demand and penalty notices are quashed. The adjudication order under Section 148A[d] of the IT Act is also quashed and the proceedings restored for reconsideration.The second respondent shall furnish the reasons recorded for initiation of proceedings under Section 148 of the IT Act before proceeding further consequent to this order.
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2023 (12) TMI 1128
Scope of limited scrutiny - Addition u/s. 69A - Addition towards Interest paid to Bank of Baroda - HELD THAT:- It is a fact that the assessee maintains a cash credit account with Bank of Baroda which is in the nature of current account. From the bank statement we observe that the opening balance as on 1/4/2017 is Rs. 9,67,51,144.25 and the closing balance as on 31/3/2018 is Rs. 8,28,19,048.25. It is also noticed that the amount debited for Rs. 4,52,58,180/- on 29/12/2017 and even after such debit, the balance is within the limits which indicates that the assessee has serviced the interest portion.
It is also seen from the paper book submissions of the Ld. AR that the bank has issued a Certificate dated 27/5/2022 regarding the receipt of interest from the CC Account. In view of the above facts of the case, we have no hesitation to delete the addition made by the Ld. Revenue Authorities u/s. 43B of the Act. We therefore allow this ground raised by the assessee.
Limited scrutiny proceedings for examining “business loss” - In case, if the Ld. AO wants to take up the case for complete scrutiny, first the Ld. AO has to convert the limited scrutiny into complete scrutiny case and then he may take up the case for complete scrutiny with the prior approval of the Ld. Pr. CIT / CIT concerned after being satisfied about the issue of converting it into a complete scrutiny. In the instant case, we find that no such approval has been granted to the Ld. AO. We therefore find that the Ld. AO has travelled beyond his jurisdiction in treating the cash deposits u/s. 69A of the Act which is not valid in law and therefore we are inclined to delete the addition made by the Ld. Revenue Authorities and allow the ground raised by the assessee.
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2023 (12) TMI 1127
Treatment of advance received in respect of sale of agricultural land jointly executed with co-owner - Treating partial advance received against agreement to sell of an ancestral joint agricultural land as sale consideration - Whether no transfer of possession of land in the year under consideration? - only argument of the assessee is that the land in question was only advance and it could not be treated as sale consideration and since no possession of land was given, therefore, there was no transfer - HELD THAT:- AO did not discard completely the contention regarding source of deposit being advance/sale consideration. However, he made addition on the basis that no capital gain was offered by the assessee.
We find merit into the contention of learned counsel for the assessee that the amount was merely advance payment and the transfer was completed in the year 2020. Our attention was drawn towards sale deed and settlement agreement executed. As per these documents the possession was handed over on 15.02.2020.
Therefore, hereby direct the AO to delete the impugned addition. The AO would be at liberty for taxing the capital gain arising out of sale of capital asset in the relevant year in accordance with law, Grounds of appeal are allowed.
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2023 (12) TMI 1126
Estimation of income - unaccounted purchases - grievance of the Revenue is that since the assessee has not properly explained the sources for the cash purchases the decision of the Ld. AO by making an addition u/s. 69A of the Act treating it as unexplained cash holds good and therefore the same may be sustained - HELD THAT:- We are of the opinion that the entire unaccounted purchases cannot be treated as income of the assessee and only the profit element should be considered as income for the purpose of computing the tax on sales. Hence, we are inclined to allow 8% on the sales made by the assessee as income of the assessee. Accordingly, the Ld. AO is directed to work out the income of the assessee and tax the same in accordance with law.
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2023 (12) TMI 1125
Penalty u/s. 270A - under reporting of income by not reducing the insurance claim received by the assessee from the block of assets which has in fact resulted in excess claim of depreciation - assessee in the present case has stated that it was not in an advantageous position to claim higher depreciation as it was adverse for the assessee in subsequent years and that there was no question of reducing the tax liability where the assessee’s return of income declared a huge loss during the year under consideration - CIT(A) deleted penalty levy - HELD THAT:- CIT(A) had relied on the decision of Reliance Petro Products Pvt. Ltd. [2010 (3) TMI 80 - SUPREME COURT] where it has held that furnishing inaccurate claim of expenditure would not amount to giving inaccurate particulars of such income.
Assessee has relied on various other decisions which have reiterated the proposition that the claim of higher depreciation would not amount to concealment of income. It is also observed that the decision of the Hon'ble Jurisdictional High Court in the case of CIT vs. Somany Evergreen Knits Ltd. [2013 (4) TMI 154 - BOMBAY HIGH COURT] has held that excess claim of depreciation was a bona fide mistake on the part of the assessee which attracts no levy of penalty.
By respectfully following the above said decision, we deem it fit to hold that there is no infirmity in the order of the ld. CIT(A) in deleting the penalty levied by the ld. A.O. Decided in favour of assessee.
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2023 (12) TMI 1124
Assessment against deceased/non existent assessee - Whether any proceedings which could have been taken against the deceased if he had survived may be taken against the legal representative in terms of section 159(2)(b)? - HELD THAT:- As seen that the AO despite having knowledge of the deceased assessee, except mentioning in the show cause notice, the name of the Legal Heir has not incorporated the deceased assessee either in the Assessment Order or in the subsequent demand notice or show cause notice for imposing/ proposing to impose penalty u/s 271AAC(1) of the Act.
In the decision of Hon’ble Punjab And Haryana High Court in the case of Swaran Kanta [1988 (11) TMI 91 - PUNJAB AND HARYANA HIGH COURT] AO therein has acknowledged the Legal Heir of the deceased assessee and, therefore High Court has held that the title of the Assessment Order which was not correctly worded would not make the Assessment Order invalid as was sought to be declared by the Revenue Authorities and the Tribunal was fully justified in restoring the order of assessment in exercising power under Section 292B of the Act. But in the present case, the Assessing Officer, despite having knowledge, has not recognised the Legal Heir while passing the final order as well as the subsequent demand order/notice and notices relied to imposing of penalty.
From the perusal of records, it can be seen that the AO has passed the Assessment Order in the name of deceased person which is non-existent person and when the order passed on the non-existent person despite represented by the Legal Heir, the same cannot be curable under Section 292B.
AO has consciously chose the name of the deceased assessee. In the eyes of law, if the assessee is deceased and Assessing Officer is very well aware about the same, then order has to be passed in the name of the Legal Heir of the deceased assessee. But the AO chose otherwise and, therefore, this defect is not curable as later on notices for demand as well as for imposing of penalty was issued in the name of the deceased assessee and thus the Assessment Order itself becomes void-ab-initio. CIT(A) has taken proper cognisance of the same and allowed the plea of the assessee and held the Assessment Order invalid. Appeal filed by the Revenue is dismissed.
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2023 (12) TMI 1123
Allowability of Employee Stock Option Plan [ESOP] expenses - allowable revenue expenses or not? - AO who was of the firm belief that there is no specific section under which ESOP expenditure is allowable under the Income tax Act, 1961 and the only section under which the said claim can be made is section 37, but even u/s 37 of the Act, claim of ESOP expenses cannot be allowed and added the same - HELD THAT:- It is the say of assessee that now this issue is no more res integra as the same has been decided in the case of Lemon Tree Hotels [2015 (11) TMI 404 - DELHI HIGH COURT] similar question was answered in favour of the Assessee by holding that the cost of ESOP could be debited to the profit and loss account of the Assessee. This Court has also in its decision in Oswal Agro Mills Ltd.[2015 (11) TMI 301 - DELHI HIGH COURT] held that the expenditure incurred in connection with issue of debentures or obtaining loan should be considered as revenue expenditure. Decided in favour of assessee.
Disallowance u/s 40a(ia) - non deduction of TDS on reimbursement of circuit expenses - During the course of scrutiny assessment proceedings, AO noticed that the assessee has reimbursed to Ameriprise Financial Services Inc [AFSI] on behalf of the assessee but assessee has not deducted - HELD THAT:- As considered the invoice and find that though the AT&T has raised invoice on AFSI, but it is for the service provided to the assessee at Gurgaon. The said notice for an amount and AFSI has raised the invoice of the same amount on the assessee and this amount has been reimbursed to the assessee. Thus we are convinced that the amount reimbursed by the assessee is towards circuit expenses to which provisions of section 40a(ia) do not apply. We, therefore, decline to interfere with the findings of the ld. CIT(A). Ground No. 2 is also dismissed.
Addition of employees contribution to the Provident Fund deposited beyond the due date - HELD THAT:- This issue is now well settled in favour of the Revenue and against the assessee in the case of Checkmate Services [2022 (10) TMI 617 - SUPREME COURT]
Disallowance u/s 14A - as been strongly contended that during the year under consideration, the assessee did not earn exempt income. Therefore, no disallowance is called for u/s 14A - HELD THAT:- We are of the considered view that if no exempt income is earned by the assessee, no disallowance can be made u/s 14A r.w.r 8D of the Rules as held in the case of Cheminvest Ltd [2009 (8) TMI 126 - ITAT DELHI-B] affirmed in CORRTECH ENERGY PVT. LTD. [2014 (3) TMI 856 - GUJARAT HIGH COURT]
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2023 (12) TMI 1122
Income taxable in India - interconnectivity utility charges (IUC) received by the assessee as Royalty / FTS in India - HELD THAT:- On perusal of the agreement between the assessee and the end users, it is noted that the installation and operation of sophisticated equipments are with the view to earn income by allowing the users to avail the benefits of such equipments or facility and does not tantamount to granting the use or the right to use the equipment or process so as to be considered as royalty within the definition of "royalty" as contained in clause 3 of Article 13 of India-France DTAA.
We note that the issue has now been settled pursuant to the decision of in a group of cases between M/s. Vodafone Idea Ltd. (Formerly known as M/s. Vodafone Mobile Services Ltd. vs. DDIT(IT) & Ors. [2023 (7) TMI 1164 - KARNATAKA HIGH COURT]
In case of Vodafone Idea Ltd [2023 (7) TMI 1164 - KARNATAKA HIGH COURT] also observed that the equipments and submarine cables are situated overseas and that Vodafone Idea Ltd. had availed certain services from the non-resident telecom operators and that such agreements would not create a permanent establishment of such non-resident telecom operators in India.
Thereafter Hon'ble High Court after verifying the facts of the case having regards to the decision of Hon'ble Supreme Court in case of Engineering Analysis Centre of Excellence (P.) Ltd [2021 (3) TMI 138 - SUPREME COURT].
We hold that payments received by assessee towards interconnectivity utility charges from Indian customers/end users cannot be considered as Royalty/FTS to be brought to tax in India under section 9(1)(vi)/(vii) of the Act and also as per DTAA.
We also note that in the present facts of the case, at no point of time, any possession or physical custody, control or management over any equipment is received by the end users/customers. It is also noted that the process involved in providing the services to the end users/customers is not "secret" but a standard commercial process followed by the industry players. Therefore the said process also cannot be classified as a "secret process", as is required by the definition of "royalty" mentioned in clause 3 of Article 13 of India-France DTAA.
The receipt of IUC charges cannot be taxed as Royalty under Article 13 in India of India-France DTAA. The payment received by the non-resident assessee amounts to be the business profits of the assessee which is taxable in the resident country and is not taxable in India under Article 5 of the DTAA as there is no case of permanent establishment of the assessee that has been made out by the revenue in India. Even Hon'ble High Court has in para 25, held that the non-resident service providers do not have any presence in India. Appeal filed by the revenue stands dismissed.
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2023 (12) TMI 1121
Assessment order passed on an non- existent entity - status of assessee - Pvt Ltd. Company or LLP - appellant company has been converted from the existing private limited company into a Limited Liability Partnership ('LLP') in accordance with the provisions of Limited Liability Partnership Act - say of the ld. DR that the facts of the present case is neither of amalgamation nor of merger/demerger, but a simple case of change in the status of the assessee from a private limited company to a limited liability partnership, therefore, assessment cannot be quashed as the status of the assessee continued for the year under consideration.
HELD THAT:- The undisputed fact is that the status of the assessee changed from private limited company to a limited liability partnership on 22.04.2019. It is also not in dispute that immediately the assessee informed not only the jurisdictional Assessing Officer but also the PCIT.
Also undisputed fact that subsequent to the change of status, all the notices were replied by the assessee in the name of LLP. Therefore, it can be stated that the change of status was brought to the knowledge of the Assessing Officer in all possible ways. Yet, the Assessing Officer chose to frame the final assessment order in the name of a no-existent entity. The ratio laid down by the Hon'ble Supreme Court in the case of Maruti Suzuki Ltd [2019 (7) TMI 1449 - SUPREME COURT] squarely applies and has been rightly followed by the NFAC.
In the case of Mahagun Realtors [2022 (4) TMI 347 - SUPREME COURT] , no intimation about merger was brought to the notice of the Assessing Officer and the return filed after amalgamation was still in the name of the amalgamated company and fact of amalgamation was not disclosed in the business/organization column and the assessment order indicated the name of both the amalgamation and the amalgamating company and during the assessment proceedings, the assessee made the Assessing Officer believe that the amalgamating company was still in existence. All these facts before the Hon'ble Supreme Court are in favour of the assessee which facts are completely absent in the case in hand. Therefore, we do not find any reason to interfere with the findings of the ld. CIT(A).
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2023 (12) TMI 1120
Income taxable in India - existence of dependent agent PE - amount received by the assessee from supply of software and automated services - HELD THAT:- The issue in question in AY 2017-18, the Co-ordinate Bench of the Tribunal in assessee own case [2023 (1) TMI 14 - ITAT DELHI] as held we find that the issue of attribution to profit when the transaction has been found to at Arm's Length between foreign party and the Indian AE, then no further attribution is required has already been decided by the decision of the Hon'ble Supreme Court in the case of DIT v. Morgan Stanley & Co. Inc [2007 (7) TMI 201 - SUPREME COURT]
As it follows that the finding of PE is also without cogent basis. Be that as it may issue of PE becomes academic and we are not engaging further into it. We have already found that functions performed by Adobe India are actually not different than the agreement and transfer pricing documentation.
There is no gainsaying that factually the issue stands on identical footing in relation to preceding assessment years, as, both the Assessing Officer and learned DRP have decided the issue following their earlier decisions. That being the case, respectfully following the decision of the coordinate Bench, as referred to above, we hold that the amount received by the assessee from supply of software and automated services, are not taxable in India. The Assessing Officer is directed to delete the additions.
Levying tax on interest on the income-tax refund received by the Appellant during the year under consideration - India-Ireland Double Taxation Avoidance Agreement - Revenue has not brought to our notice any binding precedent on this issue. Therefore, the Assessing Officer is directed to tax the interest @10% as prescribed in the Indo-Ireland Tax Treaty.
Credit of TDS whilst computing the tax liability of the Appellant for the year under consideration - We hereby direct the Assessing Officer verify the claim and grant the credit of taxes deducted at source in accordance with law.
Levying interest u/s 234A whilst computing the tax liability of the Appellate for the year under consideration - When the return of the income has been held to be validly filed then all consequent action related to levy of interest u/s. 234A would follow as prescribed under the law. We therefore direct the AO to verify and levy the interest u/s. 234A as per the provisions of the Act as if it is a valid return. This ground of the assessee appeal is allowed in terms indicate above.
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2023 (12) TMI 1119
Disallowance u/s 14A - if there are funds available with the assessee as a common pool of interest free and interest bearing funds, the assessee cannot be granted the benefit of the presumption - HELD THAT:- We find that on the issue of applicability of Section 14A of the Act, the co-ordinate Bench had decided the issue that when the assessee is holding investment as stock-in-trade, no disallowance under Section 14A of the Act can be made.
The co-ordinate Bench decided the issue for A.Y. 2012-13, relying on the decision of PCIT Vs. Punjab National Bank [2022 (6) TMI 85 - DELHI HIGH COURT] where in it has been held that where the assessee bank is holding investment as stock-in-trade no disallowance under Section 14A of the Act can be made. Decided in favour of assessee.
Refund adjusted first against the interest payment and then on taxes - HELD THAT:- This issue has been decided by the learned CIT (A) in favour of the assessee by relying upon several judicial precedents of the co-ordinate Benches. No contrary decision was produced before us. Therefore, we uphold the order of the CIT (A).when the refund is due to the assessee, the amount refunded has to be adjusted towards interest payment to assessee first and the balance any shall be adjusted towards tax - Decided in favour of assessee.
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2023 (12) TMI 1118
Excess depreciation claimed on crawler cranes - depreciation @ 30% OR 15% - assessee–company is engaged in the business of material handling and erection of heavy equipment on contract basis and providing equipment on hire during the year under consideration - whether the cranes are to be considered as 'Motor lorries' and be allowed depreciation @ 30% or be treated as machinery and allowed depreciation @ 15%? - HELD THAT:- As relying on Gujco Carriers vs. CIT [2002 (2) TMI 48 - GUJARAT HIGH COURT] assessee can claim higher depreciation on cranes @ 30%, therefore, we do not find any infirmity in the conclusion reached by ld CIT(A). That being so, we decline to interfere with the order of Id. CIT(A) in deleting the aforesaid additions. His order on this addition is, therefore, upheld and the grounds of appeal of the Revenue are dismissed.
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2023 (12) TMI 1117
Scope of limited scrutiny - mandation of recording satisfaction before extending/expanding scope of scrutiny - case of the Assessee was selected for ‘limited scrutiny’ for the purpose of verifying Large interest expenses relatable to exempt income (u/s 14A) and High interest expense as compared to business turnover, but the additions have been made other than the reasons for which the limited scrutiny has been selected for, which is not only illegal, arbitrary but also contrary to the circulars of the CBDT - HELD THAT:- As found that the AO travelled beyond the issues involved in the “limited scrutiny” and made enquiries and the additions u/s 68 on account of unsecured loan, on account of unaccounted expenditure and further made addition on account of interest expenses.
We find it handy to refer the instructions of CBDT issued in respect of examination of issue other than the reasons taken up in limited scrutiny case.
Assessment order passed by the Assessing Officer disregarding the instructions of the CBDT are liable to the set aside and no substantial of law arises. CBS International Projects Pvt. Ltd. [2019 (2) TMI 1748 - ITAT DELHI] and Best Plastics Pvt. Ltd. [2006 (4) TMI 53 - HIGH COURT, DELHI]
Considering CBDT Circular and the Judicial Precedents, we hold that the Assessing Officer can widen the scope of scrutiny even the case is selected for limited scrutiny under CASS, however, the condition precedent for such widening of the scope is that the Assessing Officer has to seek prior approval of the authorities mentioned. Such prior approval and the permission of the PCIT is lacking in the instant case. There was no satisfaction about the merits of the issue which necessitated complete scrutiny in the instant case. Hence, the Assessment framed by the Assessing Officer on the issues which are not inconsonance of the instruction of CBDT are liable to be quashed. The additions made by the Assessing Officer being beyond the scope of the limited scrutiny and the same is deleted. Decided in favour of assessee.
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2023 (12) TMI 1116
Addition u/s 68 - receipt was not declared in the ROI and the receipt remain unexplained - taxation of additional income u/s 115BBE - additional income disclosed during the course of Survey in the revised return - Counsel stated that assessee did not have any other source of income other than the income which is generated from the hospital owned by the assessee company - HELD THAT:- In spite of offering this additional income found undisclosed during the course of Survey, the assessee returned loss in both the revised returns only because of claim of deduction u/s 35AD of the Act. Thus, if the assessee has already offered the additional income disclosed during the course of Survey in the revised return filed, there was no reason to add the same again in the assessment.
AO has brought it to tax u/s 68 r.w.s 115BBE of the Act. During the course of Survey in the hospital premises, unaccounted receipts of the hospital in the name of certain doctors were found. As the receipts in question are relating to the business operations of the assessee's hospital. Therefore, such income should be brought to tax as the business income u/s 28 of the Act. Therefore, we note that additional income earned in the course of business ought to be taxed as regular income and not u/s 68.
CIT(A) has rightly noted that the assessee is in the business of running of the hospital. During the course of survey u/s 133A of the Act, some loose papers were found showing unaccounted hospital receipts. Since the hospital receipts are part of the business receipts, therefore CIT(A) held that the provisions of section 68 cannot be made applicable, in view of the decision of Shilpa Dying & Printing Mills Pvt. Ltd [2015 (7) TMI 691 - GUJARAT HIGH COURT].
Section 68 of the Act can be invoked only if no explanation is offered by the assessee about the nature and source of income / receipts and such explanation is not found to be satisfactory in the opinion of the AO. However, in the instant case, the loose papers found during the course of Survey and the statements of the directors recorded during the course of Survey showed that the undisclosed receipts were pertaining to the undisclosed income of the hospital ran by the assessee- company.
CIT(A) held that the undisclosed hospital receipts found during the course of Survey need to be taxed as income from business and are to be brought to tax as per the normal provisions of the Act. The said income is already offered in the revised return, therefore has to be taxed as income from business, and therefore the provisions of section 115BBE of the Act are not applicable with reference to the said income. Based on above reasoning, the ld CIT(A) deleted the addition made by the assessing officer - We have gone through the above findings of ld CIT(A) and noted that there is no infirmity in the order of ld CIT(A). That being so, we decline to interfere with the order of Id. CIT(A) in deleting the aforesaid additions. His order on this addition is, therefore, upheld and the grounds of appeal Nos.1 and 2 of the Revenue are dismissed.
Disallowance of deduction of capital expenditure u/s 35AD - We note that during the course of Appellate Proceedings, the assessee submitted all the details of capital expenditure. As the capital expenditure details were not furnished before the assessing officer, the details furnished during Appellate Proceedings were in the nature of additional evidence under Rule 46A and hence, were forwarded by CIT(A) to the assessing officer for verification and remand report. The assessing officer vide letter dated 05.09.2018 has submitted the remand report wherein he has stated that the assessee has only 92 beds as against 100 beds as required for eligibility u/s 35AD of the Act.
The assessee submitted a rejoinder dated 10.10.2022 before ld CIT(A). In the said rejoinder, the assessee has stated that the Inspector from the assessing officer's office who visited the hospital has not counted the second beds in the twin sharing rooms under the presumption that the second bed is for the patient's attendant. The assessee has also submitted before ld CIT(A), the photographs of the twin sharing rooms with bed numbers in support of his claim. It was further submitted sharing rooms the attendants are provided small sofas and not the beds. The assessing officer during remand proceedings has recorded the statement of Mr. Kirit N Panchal, from Yogesh Surgicals, the firm which has supplied the beds and other equipments to the assessee's hospital. In the said statement, Mr. Kirit Panchal has stated that he has supplied 64 semifaller beds and 36 ICU beds and 3 hydraulic emergency trolley beds. Thus, the supplier has also confirmed that he has supplied more than 100 beds to the assessee hospital which fulfills the eligibility that the assessee has more than 100 beds to claim deduction u/s 35AD of the Act. All these beds and other capital goods to the tune of Rs. 3,16,29,353/- were purchased by the assessee before the date of commencement of the hospital and hence, was found to be eligible for deduction u/s 35AD of the Act.
Whether the claim of deduction u/s 35AD of the Act, which is not made in the original return can be made in the revised return filed? - In the assessee's case, as the assessee has filed the original return in time as per the provisions of section 139(1) of the Act, the revised return filed as per the provisions of section 139(5) of the Act, claiming the deduction u/s 35AD of the Act for the first time needs to be allowed to the assessee. Therefore, the deduction u/s 35AD being 150% of the capital expenditure incurred before the commencement of business has to be allowed to the assessee. Therefore, ld CIT(A) has allowed the deduction u/s 35AD of the Act. No valid reason to interfere with the decision and findings of the Ld.CIT(A), hence we dismiss ground Nos. 3 to 8 raised by the Revenue.
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2023 (12) TMI 1115
Unaccounted interest receipts - Survey action u/s 133A of the Act was carried out in the premises of one Vatika Group/ third party - AO on the basis of the seized documents, it emerged that the assessee company alongwith the other group entities had actually entered into the loan agreements with the entities of Vatika Group, whereas such transactions were otherwise camouflaged as transactions of sale and purchase of properties - CIT(A) deleted addition - HELD THAT:- Evidences relied upon by the AO could not be considered to indicate that the property transactions between the Vatika group and the assessee were actually loan transactions. Thus, the Tribunal has upheld the action of the CIT(A) in deleting the addition made by the Assessing Authority on account of interest income as being misplaced. In view of the similarity of the case set up by the AO in the present case viz-a-viz that in the case of M/s SEH Realtors Pvt. Ltd, following the decision of our Coordinate Bench [2023 (4) TMI 1276 - ITAT DELHI] we hereby affirm the findings of the CIT(A) on the issue in dispute and accordingly the Appeal of the Revenue for Assessment Year 2006-07 is hereby dismissed.
Assessment u/s 153A - disallowance u/s. 14A - CIT(A) deleted addition as observed that there is no incriminating material unearthed during the search, on the basis of which, the said disallowance has been made by the AO - HELD THAT:- In our view, in the absence of any material to dislodge the factual finding of the CIT(A) that the disallowance u/s. 14A is not based on any incriminating material found during search, the action of the CIT(A) in applying the ratio of the judgement of the Hon’ble Delhi High Court in the case of Kabul Chawla [2015 (9) TMI 80 - DELHI HIGH COURT] cannot be faulted. Moreover, the judgment in the case of Kabul Chawla (supra) has since been approved by the Hon’ble Supreme Court in the case of PCIT vs. Abhisar Buildwell Pvt. Ltd. [2023 (4) TMI 1056 - SUPREME COURT] Accordingly, the order of the CIT(A) on this issue is also affirmed, and the Ground No. 5 raised by the Revenue in AY 2011-12 is also dismissed.
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2023 (12) TMI 1114
Depriving duty credit under RoDTEP on exports - exports fall under the restricted category or not - prior period i.e. 01.01.2021 to 31.05.2022 - subsequent period i.e. 01.06.2022 to 13.12.2022 - HELD THAT:- Having considered the facts of the case which are identical to the case of M/s. Shree Renuka Sugars Ltd. [2023 (4) TMI 789 - GUJARAT HIGH COURT], it is opined that the respondents could not have denied the benefit of rebate under the RoDTEP scheme to the petitioners, more particularly, when the petitioners have exported product after fulfilling the conditions as prescribed by the Directorate of Sugar as well as the Notifications issued by the Central Government from time to time. The Coordinate Bench of this Court has also passed the order permitting rebate to the petitioner of the said case.
As per the Government circular dated 5th November 2022, the schedule quantity of sugar for export in Sugar Season for 2022-23 was also issued with various conditions, whereby the quantity for export of sugar to various mills was also quantified - By Notification dated 21st October 2022, the Government has also issued export release order for sugar from Somalia.
In view of the Notifications issued by the Government from time to time permitting export of sugar, the basic objective of the RoDTEP scheme is to grant benefit of rebate to the exporter as an incentive or exporting product.
The respondents are directed to grant benefit of rebate under the RoDTEP scheme to the petitioners who have exported sugar with specific permission under the specific condition prescribed by the Directorate of Sugar as per Notification No. 19/2015-20 dated 17th August 2021 and Clause 3 of paragraph 2 of the Notification No. 76/2021-Customs (N.T.) dated 23rd September 2021 - petition allowed.
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2023 (12) TMI 1113
Clearance of warehoused Goods - Seeking clearance to export the consignment of Crude Palmolein imported by the petitioner and warehoused for its own consumption - HELD THAT:- The question for consideration would be whether an importer of a warehoused consignment could, pending investigation as regards the previous imports and when the clearance is not issued under Section 68 of the Customs Act, have recourse to the right to export as contemplated under Section 69 of the Customs Act without paying import duty, and the concerned must examine this question simultaneously with the question whether the petitioner, even if it does not derive any profit from export of the warehoused consignment, would be liable to pay import duty, and conversely, whether the Revenue would be entitled to recover import duty. These aspects will have to be considered recording reasons for the conclusion to enable complete adjudication.
In view of the exigent circumstance viz. that the consignment is a perishable commodity with a shelf life which expires on 21.12.2023 and the petitioner proposes to export the consignment within this time filing shipping bills and other documents to demonstrate that it cannot receive a price which is more than the price at which the consignment is imported, the proper officer must consider these questions and take a decision within a reasonable time, and this Court must observe that if the petitioner is permitted to export upon furnishing a Bank Guarantee, and the Bank Guarantee is so furnished, the same will be subject to the final decision on the questions as aforesaid.
The petition is disposed of with liberty to the petitioner to file a request to export the warehoused consignment of Crude Palmolein imported and warehoused under Section 69 of the Customs Act with the shipping bills and such other documents to demonstrate the price that it will receive on export of crude Palmolein.
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2023 (12) TMI 1112
Classification of imported goods - T4 Fingerprint Time & Attendance System and K200 Proximity Time & Attendance System - to be classified under Customs Tariff Heading 8471 4190 or under 8543 7099? - crossing over the remand directions or not - HELD THAT:- The claim of the appellant that the authorities have gone beyond the remand directions is baseless in as much as from the orders it is seen that the authorities have limited themselves to the directions in deciding the classification. The Tribunal while remanding the case also observed that “He will not be hindered in the exercise by our views on the issue appearing in the order”. Therefore the authorities have only restricted themselves in analysing the impugned item as per its features to arrive at the correct classification.
As noted by the Original Authority, the device captures the data from the employee’s card or the data of the particular employee who key in the PIN into the device. The device does not do anything except for collecting the data at the time of entry or exit and this data is transmitted to a central server for further processing like marking the attendance, preparation of payroll or for other purposes. These facts are not in dispute. Based on the General Rules of Interpretation and the Chapter Notes, the item needs to be classified in the heading akin to it or where the specific description is provided. In this case, the data collection device imported by the appellant is nothing but a card reader working in conjunction with the server. Thus, this device functions as proximity readers/badge readers, which are specifically classified under Chapter Heading No.8543.
Since the specific function of the imported item is to mark attendance or to take note of the persons of the employees for the purpose of attendance or payroll or leave, they cannot be classified under Chapter 84 as it excludes from this Chapter as per the Chapter Note 5(E).
This Tribunal, recently, in the case of COMMISSIONER OF CUSTOMS, BANGALORE VERSUS M/S. KRONOS SYSTEMS INDIA PVT. LTD. [2023 (10) TMI 1006 - CESTAT BANGLORE], in an identical issue held the product to be rightly classifiable under Chapter 8543.
Thus, by following the decisions of this Bench, it is found that the product is rightly classifiable under Chapter 8543 - the impugned order is upheld and the appeal is dismissed.
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2023 (12) TMI 1111
Validity of remand orders made by the learned trial Judge concerned - whether the arrest of the petitioners was terms of the relevant provisions embodied in Sections 17-A, 18(1), and, in Section 19(1) of the Prevention of Money Laundering Act, 2002? - HELD THAT:- It has but clearly emerged rather from the evident fact, qua the accused, thus respectively accompanying the officials of the E.D., on 27.10.2023, respectively in the seized car or in the car belonging to them. Therefore, the said manner of the accused accompanying the E.D. officials, does tantamount to theirs being then unlawfully restrained, and, as such, the accompanying of the accused in the said vehicles, thus on 27.10.2023 but also becomes the actual date of theirs being, thus arrested then. However, when on the said date the accused were not supplied with the grounds of arrest or the reasons to believe, that they have committed offences punishable under the Act of 2002. Consequently, thereby pervasive breach is caused to the mandatory provisions.
The argument, if any, as addressed before this Court by the learned ASG concerned, that the said accompanying of the accused in the vehicles, was only in pursuance to summons, becoming issued upon them, for ensuring that thereby, they are interrogated at the E.D. headquarters located at Delhi, is but also liable to be rejected - The reasons for rejecting the above argument, but is again planked, upon the trite evident fact, that unless the accused had willingly accompanied the E.D. officials concerned, thus in their private vehicles or in the vehicle of their relatives, thereupon theirs in the above mode of theirs accompanying the E.D. officials to the E.D. headquarters, located at Delhi, would be construed to be theirs thereby then, thus becoming unlawfully restrained.
The above argument, cannot become accepted by this Court, in view of the mandate recorded by the Hon’ble Apex Court in case titled as V. Senthil Balaji V. State Represented by Deputy Dikrector and Others [2023 (8) TMI 410 - SUPREME COURT], wherein, it has been expostulated, that when material, does emerge rather suggestive that the parameters laid thereins, relating to application of judicial mind by the learned trial Judge concerned, to the makings of the relevant statutory breaches but become infringed, thus in his making the impugned order of remand, as such, upon, the vice of non-application of mind rather emerging, thus planked, upon breach being caused to the mandate of Section 19 of the Act of 2002, thereby the orders of remand are illegal.
This Court quashes the order of remand, and, in the exercise of writ jurisdiction, declares the arrest of the petitioners to be non-est and void.
In consequence, after allowing the instant petitions, this Court quashes the impugned order of remand (Annexure P-1 in both petitions), and, orders that the petitioners be released from judicial custody, but subject to theirs furnishing personal, and, surety bonds in the sum of Rs. 5,00,000/- each, before the learned trial Court/Chief Judicial Magistrate/Duty Magistrate concerned, and, to his satisfaction, and, also subject to theirs not tampering with prosecution evidence, and, also theirs not influencing prosecution witnesses - Petition allowed.
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