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Showing 341 to 360 of 1430 Records
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2023 (12) TMI 1090
Deduction u/s. 80G - amount incurred for the purpose of Corporate Social Responsibility - DRP held that, as per section 80G(2) a deduction is admissible in respect of any sums, which is paid by the assessee in the previous year as donations to various bodies/institutions indicated in that section - HELD THAT:- As per the Companies Act 2013, it is mandatory for certain specified companies to spend 2 percent of their average profits to CSR. CSR expenses incurred by companies are now specifically treated as for non business purposes and hence are disallowed for Income tax purposes.
Finance Act 2014 mandated that “CSR Expenditure” shall not be allowed as “Business Expenditure” u/s 37 of Income Tax Act 1961. The ‘ Memorandum of Finance Bill 2014’ had also clarified that this initiative is primarily to ensure that companies share the burden of providing social services and granting deduction for CSR expenditure would amount to the Government effectively bearing one third of that expenditure. This same Memorandum also added that if CSR expenditure is of the nature which is covered by specific deductions contained in Sections 30 to 36, the expenditure by virtue of being governed by a specific provision (of Income tax) shall be granted a deduction if the conditions prescribed are satisfied. No specific tax exemptions have been extended to CSR expenditure. The Finance Act, 2014 also clarifies that expenditure on CSR does not form part of business expenditure.
Thus we hold that no deduction u/s. 80G is allowable on the amount incurred for the purpose of Corporate Social Responsibility.
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2023 (12) TMI 1089
Rectification of mistake - Benefit of brought forward loss - CIT(A) directed the AO to recompute the income of appellant for A.Y. 2009-10 after taking into consideration the brought forward loss for A.Y. 2008-09 as determined by AO by replacing the disallowance of loss - HELD THAT:- It can be appreciated that consequent to the order of the Tribunal however, for A.Y. 2008-09 the effect giving order was passed by Ld. AO on 12.12.2018 by which the total loss for A.Y. 2008-09 was recomputed at Rs. 4,92,05,810/- . That thus made available loss for set off or carry forward in the subsequent years. Same has been taken into consideration by Ld. CIT(A) while passing the direction in the impugned order. The appeal has no merit. Same is dismissed.
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2023 (12) TMI 1088
Deduction u/s. 80IB - compensation received by the assessee from the insurance company - CIT(A) upheld the addition made by the ld. A.O. on the ground that the insurance/compensation claimed cannot be considered for computing the eligible profit and gains derived from the industrial undertaking of the assessee - HELD THAT:- The assessee in the present case has received compensation for destroyed and lost goods from the insurance company and from the franchisees which the Revenue claims to be not from the industrial undertaking and shall not be the profits and gains of the business of the assessee.
The Hon’ble Gujarat High Court in SHREE RAMA MULTI TECH LTD. [2013 (10) TMI 306 - GUJARAT HIGH COURT] after duly considering the decision of Sportking India Ltd. [2009 (8) TMI 29 - DELHI HIGH COURT] has held that such compensation received from insurance company for the damage incurred by the assessee would be the profit/loss from such industrial undertaking, for the reason that if not for such loss, the assessee would have earned income which is otherwise eligible for deduction u/. 80IB,
It is evident that on identical facts, the Hon'ble High Court has held that the assessee is eligible for deduction u/s. 80IA/80IB of the Act on compensation received due to destruction of goods before sale had taken place. We find that on destruction of raw materials, the assessee was paid insurance claim, the cost of raw material is already considered as ‘cost’ while working out the profit of eligible undertaking and the claim tantamount to sale of raw materials.
As regards to loss of goods at franchisee and the amount paid by such franchisee would also be sale of goods. Thus, both the above sums are profits derived from industrial undertaking business eligible for deduction. Hence, we direct the ld. A.O. to allow deduction u/s. 80IB on both the amounts. We, therefore, allow the appeal filed by the assessee.
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2023 (12) TMI 1087
Addition u/s 68 - undisclosed cash credit found in the books of the assessee - unexplained share application money in the form of share capital - HELD THAT:- We find that the assessee which is regularly carrying on business activity of manufacturing sponge iron, registered under the Excise Act, holds fixed assets, having considerable amount of stock in hand and has successfully discharged the burden of proof primarily casted upon it to explain the identity and creditworthiness of investor company i.e., Bhillai Holdings Pvt. Ltd., which is group concern having common directors and shares issued at face value and no share premium has been charged.
Genuineness of the share transactions and correctness of such details has not been disputed by the Revenue Authorities except making general observations. Therefore, considering the evidences placed by Ld. A/R to explain the nature and source of the alleged share application money, we find no reason to interfere with the findings of the ld. CIT(A) deleting the addition made u/s 68 of the Act. Appeal of the revenue is dismissed.
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2023 (12) TMI 1086
Treating intimation u/s “143(1) as "non-est" - intimation u/s 143(1) of the Act was never communicated - whether CIT (A) exceeded his jurisdiction in entertaining appeal against intimation where no adjustment of income was carried out resulting in demand? - demand raised on the basis of book profit u/s 115JB as disclosed in the schedule 7 of return of the return of income for A.Y. 2008-09 - HELD THAT:- The entire quarrel revolves around the following findings of the Hon'ble High Court of Delhi – Court on its Own Motion [2012 (9) TMI 163 - DELHI HIGH COURT] as held onus to show that the order was communicated and was served on the assessee is on the Revenue and not upon the assessee. We may note in case an order under Section 143(1) is not communicated or served on the assessee, the return as declared/filed is treated as deemed intimation and an order under Section 143(1). Therefore, if an assessee does not receive or is not communicated an order under Section 143(1), he will never know that some adjustments on account of rejection of TDS or tax paid has been made. While deciding applications under Section 154, or passing an order under Section 245, the Assessing Officers are required to know and follow the said principle.
Thus the onus is on the Revenue to show that the TDS or tax credit had been fraudulently claimed by the assessee. Facts on record show that the Revenue has grossly failed in showing that the intimation u/s 143(1) of the Act ever served upon the assessee as the Revenue failed to give any proof of service of such intimation to the assessee. Therefore, intimation u/s 143(1) of the Act has to be treated as non-est or invalid.
Coming to the observations of the Hon'ble High Court, again the onus is on the Revenue to show that the claim of TDS is fraudulent. A perusal of the computation sheet shows that inadvertently the assessee has mentioned the tax payable at normal rates at Sl. No. 3 instead of tax payable of deemed total income u/s 115JB of the Act.
This by any stretch of imagination, cannot be considered as fraudulent activity of the assessee to deny the benefit of the decision of the Hon'ble Jurisdictional High Court of Delhi [supra]. Decided against revenue.
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2023 (12) TMI 1085
Penalty u/s 271(1)(c) levied - AO held that assessee had concealed his income by not filing the return of income and not showing his income and paying due taxes thereon - concealment has come to notice as a result of scrutiny assessment proceedings only as had the case not been re-opened u/s 147/148 assessee would have succeeded in tax evasion - HELD THAT:- We note that assessee did not conceal the income and was in the bona fide believe that the said income, which was taxed u/s 147 of the Act, was not assessable under the Act. We note that there is no finding of the AO in the assessment order that assessee has concealed his income; rather Assessing Officer has accepted the returned income filed by assessee, as it is, (in response to notice u/s 147 of the Act).
We note that in the case of CIT v. K.R. Chinni Krishna Chetty [1998 (6) TMI 5 - MADRAS HIGH COURT] has held that u/s 271(1)(c) of the Act the authority is given the discretion to levy a penalty if there is concealment of particulars of income and even as regards the quantum of the penalty there is a discretion. Of greater importance is the necessity for a definite finding that there is concealment, as without such a finding of concealment, there can be no question of imposing any penalty. In the assessee’s case, the AO has not given any finding in assessment order that the assessee had concealed any income or furnished inaccurate particulars of such income. He had simply accepted the returned income u/s 148 - penalty u/s 271(1)(c) will not be imposable. Decided in favour of assessee.
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2023 (12) TMI 1084
Estimation of income - bogus purchases - CIT(A) noted that in absence of visibility on correctness of the amount paid/ payable to creditors, the possibility of purchasing the goods from grey market at lower rates and recording the same at inflated price in books of accounts cannot be ruled out. However, if the entire purchases are disallowed, the corresponding sales also need to be ignored but the assessing officer has not done so - HELD THAT:- As observed by ld CIT(A) that the assessee's business is recently started and it is into second year of its operations. During the year under consideration the gross profit earned by assessee is 13.05%. Therefore, ld CIT(A) restricted the addition to Rs. 9,80,121/- (Rs.75,10,503/- X 13.05%). We have gone through the above findings of CIT(A) and noted that there is no 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 1083
Detention of goods - consignment of apples - prohibited goods or not - hit by the N/N. 5/2023 - HELD THAT:- In the present case, the Bill of Entry seeks to clear the imports of apples which are imported by the petitioner at a price which is at Rs. 50/- per kg. Thus clearly the price per kilogram being Rs. 50/- per kg. which is not below the price fixed by Notification No. 5 of 2023, it would be correct for the petitioner to contend that the respondents cannot detained the petitioner’s consignment on the basis of the minimum price as fixed by the said notification.
It is opined that there is no reason as to why the petitioner ought not to be permitted to clear the goods - it is directed that the imports of the petitioner be not detained on the ground that this goods are prohibited goods under NN. 5/2023 and on such count be released on the petitioner furnishing a bond - An appropriate assessment of the bill of entry be accordingly undertaken in accordance with law within a period of 3 days from today - Petition disposed off.
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2023 (12) TMI 1082
Seeking provisional release of the consignment of apples imported by the petitioner - Detention on the ground that N/N. 5/2023 has been issued, which caps the minimum price of apples for import at Rs.50/- per kg - HELD THAT:- It is seen from the documents as annexed in the petition, which are Bill of Entry and Invoices, that the price at which the petitioner has imported the apples in question is at Rs. 50/- and the embargo to any clearance of such import under Notification No. 5/2023, which would operate if the value is below Rs. 50/- per kg. Thus, it would not be correct on the part of the revenue only on the ground of the notification in regard to fixing of the import price, the present consignment of the apples, as imported by the petitioner should be labelled as prohibited goods.
It is also observed that not only this Court in the case of M/S. INDUSINA EXIM L.L.P. VERSUS THE COMMISSIONER OF CUSTOMS (IMPORT) & ORS. [2023 (12) TMI 918 - BOMBAY HIGH COURT] but also the Kerala High Court as well as the Madras High Court have taken a consistent view in regard to permitting clearance of the apples on the ground that Notification No. 5/2023 has been stayed - there are no contrary judgment which takes a contrary view in regard to the notification in question.
It is directed that the imports of the petitioner subject matter of Bill of Entry No. 8854586 dated 20 November, 2023, be released on the petitioner furnishing a bond - An appropriate assessment of the bill of entry be accordingly undertaken in accordance with law within a period of three days from today - petition disposed off.
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2023 (12) TMI 1081
Seeking permission to complete the obligation of manufacturing and exporting copper wire by purchasing additional copper of the same grade from the open market and also seeking advance authorization license - HELD THAT:- The request of the Petitioner is to fill up the shortage of raw material by purchasing the same from the domestic market, the same has been rejected by the Department placing reliance on Para 4.03 of the Foreign Trade Policy 2015-20. Since the Foreign Trade Policy specifically insists that in case advance authorization is issued to allow duty free import which is physically incorporated in the export product, the request to allow the Petitioner to purchase the raw material from open market for these exports could not be permitted.
The Court while adjudicating administrative orders exercising its jurisdiction under Article 226 of the Constitution of India only looks into the decision making process and also the fact that whether the order is violative of any law. The reasons given in the order passed by the Respondent does not require any interference under Article 226 of the Constitution of India.
A perusal of the Order challenged in the present Writ Petition indicates that the DGFT has given a proper opportunity of hearing to the other sides and, therefore, this Court is of the opinion that the decision-making process is fair. Further, even on merits, the learned Counsel for the Petitioner has not been able to establish as to why the Order is contrary to the law or that any provisions of the Foreign Trade Policy or the handbook of procedures has been violated. Resultantly, this Court finds no reason to interfere with the present Writ Petition.
The writ petition is rejected.
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2023 (12) TMI 1080
Classification of goods - Bulk Reishi Gano Powder 100% Ganoderma - Bulk Ganocelium Powder 100% Gano Mycelium - whether the products are classifiable as Ayurvedic medicaments under chapter 3003.9011 of the First Schedule to the Central Excise Tariff Act, 1985 (CETA) as contended by the appellant or as food supplements under CTH 2106999 of CETA? - Invocation of the extended period of limitation under section 28(4) of the Act - Confiscation of goods under section 111 (m) and (o).
Classification - HELD THAT:- The said issue is no longer rest-integra and has been decided by the Chennai Bench in DXN Manufacturing India Private Ltd. vs. Commissioner of Central Excise and Service Tax, Pondicherry [2017 (11) TMI 608 - CESTAT CHENNAI], where the Tribunal reconsidered the matter at length on being remanded by the Supreme Court [2015 (8) TMI 1418 - SUPREME COURT] and concluded that both the impugned goods fail both the twin test for being considered as Ayurvedic medicament and therefore the products in question are nothing but food supplements promoted mainly for general health or well-being and therefore merit classification under 2108 of the CETA and more specifically under 2108.99, as it stood at the relevant time and assessed accordingly under section 4A of the Act for discharge of duty liability. The issue of classification was thus decided in favour of the revenue and against the assessee.
There are thus no hesitation in concluding the issue of classification of the products in question under CTH 21069099 as food preparation - the issue of classification on merits stands affirmed in favour of the revenue and against the appellant.
Invocation of the extended period of limitation under section 28(4) of the Act - HELD THAT:- In view of the proceedings which was pending since 2012 and the department itself had preferred an appeal, it cannot be said that the department was not aware of the classification of the products as declared in the instant bills of entry by the appellant and therefore no fault can be found on the part of the appellant as 9 out of the 10 bills of entries were filed before the final order was passed by the Tribunal on 10.01.2018 and the Order-in-Appeal by the Commissioner (Appeals) was holding the field.
The law on invocation of extended period of limitation is well settled. Mere omission or merely classifying the goods/services under incorrect head does not amount to fraud or collusion or wilful statement or suppression of facts and therefore the extended period of limitation is not invocable.
The Supreme Court in PUSHPAM PHARMACEUTICALS COMPANY VERSUS COLLECTOR OF C. EX., BOMBAY [1995 (3) TMI 100 - SUPREME COURT] has categorically laid down that where facts are known to both the parties, the omission by one to do what he might have done, and not that he must have done, does not render it suppression. Thus when all the facts are before the department as in the present case then there would be no wilful mis-declaration or wilful suppression of facts with a view to evade payment of duty - the revenue cannot invoke the extended period of limitation under section 28(4) of the Act, hence the show cause notice dated 2.07.2018 is barred by limitation for the period beyond the normal period.
Imposing penalty under section 114A of the Customs Act - HELD THAT:- As it is held that it is not a case of willful suppression, mis-statement or misdeclaration by the appellant, the ingredients required for invoking the penalty being the same, the penal action under the provisions of section 114A as imposed by the impugned order is not justifiable and is hereby set aside - the appellant cannot be held liable for penalty under section 114 AA of the Customs Act and the reasoning given by the Principal Commissioner that at the time of presenting the bill of entry, the importer made and subscribed to false declaration against the contents of bills of entry, in contravention to section 46(4) of the Act is unsustainable
Confiscation of goods under section 111 (m) and (o) - HELD THAT:- The findings in the impugned order that section 111(m) can be invoked for misdeclaration of any material particular, in respect of the goods and not necessarily only the value of the goods stands quashed and the issue stands decided in favour of the appellant that there cannot be any confiscation of goods under section 111(m) in the case of wrong classification - it is a simple case of mis-classification/incorrect classification and not mis-declaration of goods on the part of the appellant, the logical inference would be that the appellant has not wrongly claimed the exemption benefit and therefore there can be no confiscation under Section 111(o) of the Act.
The appeal is remanded to the Adjudicating Authority for the limited purpose of computing the differential duty to be demanded in respect of normal period only - the appeal is partly allowed by way of remand.
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2023 (12) TMI 1079
Levy of Anti-Dumping Duty - clearance of tyre making machines (old and used) including used Chinese origin tyre curing presses under EPCG scheme - applicability of N/N. 01/2010 dated 08.01.2010 - HELD THAT:- At the outset it has to be stated that the respondent-company has gone into liquidation as per the order of the NCLT, Bangalore Bench dated 30.12.2019. Further, in the present case, the goods imported are “used and second-hand machines”. The Chartered Engineer has reported that the goods are used and second-hand. There is no dispute on the fact that the goods are used and second-hand machines.
The Tribunal in the case of Trinity Exporters [2019 (2) TMI 1370 - CESTAT CHENNAI] had an occasion to analyse the issue as to whether ADD is leviable on import of used and second-hand machines. The issue was answered in favour of the importer and against the Department.
Taking note of the fact that the respondent-company has gone into liquidation and also following the decision in the case of Trinity Exporters, there are no merit in the appeal filed by the Department - the appeal filed by the Department is dismissed.
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2023 (12) TMI 1078
Classification of the imported goods - Frequency Converter (variable speed drive) and its parts - to be classified under Chapter Heading 9032 89 90 or under Chapter Heading 8504 4010? - HELD THAT:- The classification of the said goods has already been decided by this Tribunal’s order in M/S. ABB LIMITED VERSUS THE COMMISSIONER OF CUSTOMS (APPEALS) , BANGALORE [2023 (11) TMI 20 - CESTAT BANGALORE] which has fairly been admitted by both sides. Accordingly, following the above decision for the earlier appeals, it is held that the goods are rightly classifiable under Chapter Heading 8504 as against the classification under Chapter Heading 9032 claimed by the appellant.
The Authorized Representative on behalf of the Revenue referring to the impugned order submits that the goods are presented in the form of plugs and sockets which are rightly classifiable under 8536 in terms of Note 2(a) of Section XVI of the Customs Tariff Act, 1985. As seen above at para 4, this Tribunal has classified the frequency converter under Chapter Heading 8504 as against 9032 as claimed by the appellant. Therefore, the question of classifying the plugs and sockets as parts of frequency converter under chapter heading 9032 does not arise. Since the fact that plugs and sockets are general in nature and having cleared them for retail sale and having not being produced any evidence to prove that these items can only be used in frequency converter, the classification by the Commissioner (Appeals) under Chapter Heading 8536 69 10/90 is to be upheld. Moreover, Chapter 8536 includes lamp holders, plugs and sockets and therefore, as per the Interpretative Rules when there is a specific description, the item has to be classified accordingly.
The only contention of the appellant is that the item to be classified under Chapter Heading 9032 as parts of frequency converter, since 9032 is ruled-out, the classification under 8536 as per Rule 3(a) of the General Interpretative Rules is upheld. As per Note 2(a), parts which are included in any of the Headings of Chapter 84 or 85 or in all cases are to be classified in their respective headings. Since, frequency converter is already classified under Chapter 8504, based on Section 2(a) of Section XVI the goods are rightly classifiable under Chapter Heading 8536 69 10/90.
Appeal dismissed.
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2023 (12) TMI 1077
Confiscation of imported goods - import of aircrafts/helicopters - whether non-scheduled (passenger) services permit would qualify as non charter services permit also? - whether the appellant would qualify for providing charter service? - HELD THAT:- These issues were decided by the Larger Bench of the Tribunal in M/S VRL LOGISTICS LTD VERSUS COMMISSIONER OF CUSTOMS, AHMEDABAD [2022 (8) TMI 720 - CESTAT AHMEDABAD (LB)] where it was held that It is, therefore, clear that an operator providing non-scheduled (passenger) services can always provide such services either on individual seat basis or by chartering the entire aircraft and such a restriction is not contained either in Condition No. 104 or Aircraft Rules or the Civil Aviation Requirements - The Larger Bench also held that remunerative flights qualify as a air transport services and would be covered under the exemption.
Whether the appellant had violated Condition No. 104 of the notification merely because on one occasion one aircraft had been used without remuneration? - HELD THAT:- In reply to the show cause notice the appellant had pointed out that in regard to the aircraft VT-RAN which was imported on 13.11.2007, the first flight was undertaken on 25.01.2008 and the second flight was undertaken on 27.01.2008. The second flight was for crew familiarization and it had two pilots and Mr. Sunil Godhwani and Mrs. Dhillon, who as prospective users were travelling on the flight only for experiencing the aircraft. The flight was also from Delhi-Raipur-Bagdogra-Delhi with no stoppage time at the airports. Thus, it cannot be urged by the department that Condition No. 104 of the notification had been violated merely because one particular flight was undertaken without any remuneration - the order dated 30.09.2010 passed by the Commissioner confiscating the imported aircrafts/helicopters with an option to the appellant to redeem the same after payment of redemption fine and also confirming the demand of customs duty with interest and penalty cannot be sustained. The appellant would, therefore, be entitled to refund of the redemption fine paid by the appellant in terms of the order passed by the Commissioner.
Whether the appellant would be entitled to interest on the redemption fine amount deposited by the appellant, which is now liable to be refunded? - HELD THAT:- The issue, therefore, stands settled against the appellant in the aforesaid decision of the Larger Bench of Tribunal in Advance Mechanical Works [2004 (12) TMI 107 - CESTAT, MUMBAI]. The Larger Bench of the Tribunal had placed reliance upon the decision of the Supreme Court in Union of India vs. Orient Enterprises [1998 (3) TMI 137 - SUPREME COURT] to hold that no interest would be payable on redemption fine, while refunding the same in pursuance of an order of a higher judicial forum - The appellant would, therefore, not be entitled to any interest on the refund of the redemption fine.
The bank guarantees, however, furnished by the appellant are liable to be discharged as the order passed by the Commissioner has to be set aside.
The order dated 30.09.2010 passed by the Commissioner is set aside with a direction to the department to refund the redemption fine deposited by the appellant within a period of two months from the date of service of a copy of this order - Appeal allowed.
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2023 (12) TMI 1076
Maintainability of section 7 application - initiation of CIRP - inter corporate deposit of Rs.7 Crores is captured in an unstamped document with the title of “confirmation and undertaking” @ interest of 1% per month - Financial Creditor/R2 had made an investment of a sum of rupees seven crores in the project developed by the CD/ R1 or it is a loan?
Reliance upon unstamped document in deciding CIRP - HELD THAT:- Adjudicating Authority has come to a conclusion that there is a financial debt, there is a default basis other documents and no reliance whatsoever nature has been placed on the confirmation and undertaking dated 29.09.2015. Since Adjudicating Authority has not relied upon that and have come to a conclusion that there is a debt and default and demand notice which is not disputed and accordingly concluded that sufficient reasons exists for Section 7 CIRP proceedings. The plea of the Appellant, to claim that the unstamped agreement/instrument in question cannot be admitted into evidence under the provisions of the Maharashtra Stamp Act, as a defense, cannot render the corporate insolvency resolution process (“CIRP”) non-maintainable, when there exists other material on record to prove existence of default in payment of debt - there are no fault in the orders of the Adjudicating Authority.
Financial Creditor made an investment or gave a loan - HELD THAT:- There is a contradiction to the nature of amount payable to the Financial Creditor which is admitted in the audited financial statements placed by the Corporate Debtor, being shown as unsecured loan, and which has also been noted by the Adjudicating Authority. Furthermore, R1 himself has admitted that it has serviced the interest in accordance with the terms of the confirmation and undertaking till June 2017. National E Governance Services Limited (NeSL) Report dated 24.06.2020, also reflects this as a loan wherein the Date of Default is reflected as 23.12.2015 and the total outstanding is of Rs.4,80,80,000/- - Adjudicating authority has rightly come to the conclusion that it is a loan and allowed Section 7 proceedings under IBC.
Adjudicating Authority has come to a conclusion that there is a financial debt and there is a default on the basis of other documents, and no reliance whatsoever nature has been placed on the confirmation and undertaking dated 29.09.2015. Since Adjudicating Authority has not relied upon the “confirmation and undertaking” and has come to a conclusion that there is a debt and default and demand notice, which is not disputed and accordingly concluded that sufficient reasons exists for CIRP proceedings under Section 7 of IBC, 2016 - non-stamping of document does not render the corporate insolvency resolution process (CIRP) application filed to be non-maintainable when there exists other material on record to prove existence of default in the payment of debt.
There are no error in the order of the Adjudicating Authority admitting Section 7 proceedings of the IBC against the CD/ M/s Shankheshwar Properties Pvt. Ltd. (R-1) - there is no merit in this appeal - appeal dismissed.
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2023 (12) TMI 1075
Approval of Resolution Plan - HELD THAT:- Adjudicating Authority has directed that the proceeds from sale of the aircraft will be deposited in an escrow account and be utilized to discharge the payments to various stakeholders in accordance with the Resolution Plan. Aircraft is a depreciating asset and huge costs are being incurred for preservation and parking of the same. Appellant was trying to recover its dues de horse the Resolution Plan. Erstwhile Resolution Professional has complied with the NCLAT order and communicated the computation of dues of the workmen and employees to the Successful Resolution Applicant. The impugned order fully protects the interests of the Appellant since it has directed the amount proceeds from the sale to be kept in escrow account.
Approval of the Resolution Plan - HELD THAT:- The Adjudicating Authority in the impugned order while considering the rival submission of the parties has come to the conclusion that the sale process with regard to which LoI was issued on 19.10.2022 had concluded in view of the performance on the part of the Ace Aviation. Submission of the Successful Resolution Applicant for re-bidding insofar as three aircrafts was concerned was not accepted. With regard to other two aircrafts whose process was halted on 11.11.2022, direction was issued to reinitiate the process and conclude the sale of aircrafts after considering the Ace Aviation as one of the eligible bidders. The Adjudicating Authority did not commit any error in directing to conclude the sale agreement of three aircrafts for which LoI was already issued - there are no good ground to interfere with the order passed by the Adjudicating Authority in IA No.3747 of 2022. The interests of the Successful Resolution Applicant are also protected since the Adjudicating Authority had directed that the proceeds of the sale of aircrafts is to be deposited in the escrow account and dealt with in accordance with the approved Resolution Plan - The order disposing is not an order which has any consequence on the manner of distribution of the sale of the aircrafts as observed by the Adjudicating Authority sale proceeds has to be distributed as per the Resolution Plan. Rights and contentions of the Successful Resolution Applicant are left open to be raised at the relevant time with regard to distribution of sale proceeds as and when occasion arises.
Recovery of the PF and gratuity dues of the workmen and employees of the Corporate Debtor - HELD THAT:- The sale proceeds having been directed to be deposited in escrow account which has to be distributed in accordance with the approved Resolution Plan, the Appellants are fully protected the orders passed by the Adjudicating Authority in no manner affects the entitlement of the Appellant- ‘All India Jet Airways Officers and Staff Association’ to receive their dues under the Resolution Plan as per order of this Appellate Tribunal dated 21.10.2022. The Adjudicating Authority has not committed any error in partly allowing IA No.883 of 2023 - there are no error in the order passed by the Adjudicating Authority in IA No.883 of 2023.
There are no grounds to interfere with the orders of the Adjudicating Authority - Appeal dismissed.
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2023 (12) TMI 1074
Maintainability of appeal on the ground of time limitation - HELD THAT:- The present appeal is directed against the order dated 06.12.2022 and filed on 04.02.2023. The period of 30 days, as prescribed under Section 61(2) of the Code, counted from 06.12.2022 expired on 05.01.2023 and further period of 15 days expired on 20.01.2023 whereas the appeal has been filed on 04.02.2023. It is pertinent to mention that the impugned order was not passed dismissing the application for non-prosecution rather the impugned order was passed dismissing the application having been rendered infructuous, therefore, the period of limitation would start from the date of order 06.12.2022 in view of the decision of the Hon’ble Supreme Court in the case of V. Nagrajan Vs. SKS Ispat and Power Ltd. &Ors. [2021 (10) TMI 941 - SUPREME COURT].
The appeal having been filed even after the expiry of further 15 days prescribed under Section 61(2) proviso, is not maintainable in view of a decision of the Hon’ble Supreme Court rendered in the case of National Spot Exchange Limited Vs. Anil Kohli [2021 (9) TMI 1156 - SUPREME COURT].
This appeal has been filed beyond the period of limitation and not maintainable, the Corporate Debtor has already been sold as going concern subsequent to the order dated 19.01.2023 passed in 1018 of 2022 and thereafter the change in the management has taken effect and the sale proceeds received from such sale have also been distributed to the stakeholders.
There is hardly any merit in the present appeal which is otherwise barred by limitation and hence, the same is hereby dismissed.
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2023 (12) TMI 1073
Seeking Condonation of Delay of 15 days in filing the Appeal - sufficient cause for delay present or not - Appellant had waited for the outcome of the Liquidation Application before filing the instant Appeal - HELD THAT:- The discretion lies with the Courts to distinguish between an ‘explanation’ and an ‘excuse’ and only then to exercise discretion to condone the delay. In the instant case, it is crystal clear that the Appellant was aware of the Impugned order on 10.08.2023 itself and the justification given that the Appellant had requested the Third Respondent/The erstwhile RP to apply for a certified copy of the Impugned Order since it was not a party to the proceedings is rejected as Rule 50 read with Clause 31 of the Schedule of Fees of the NCLAT Rules, 2016 provides for the Registry to send a certified copy of the final Order to the parties concerned free of cost and the certified copies may be made available with costs as per schedule of fees, in all cases. Hence, it is clear that the Appellant itself could have applied for a certified copy by making an Application with the requisite fee, therefore, the contention of the Appellant that it was a Third party to the proceedings, is of no relevance.
The Hon’ble Supreme Court in the case of V NAGARAJAN VERSUS SKS ISPAT AND POWER LTD. & ORS. [2021 (10) TMI 941 - SUPREME COURT] addressed the issue of the commencement date of the period of limitation for filing an Appeal under Section 61 of the Code. In this aforenoted Judgment, the Hon’ble Supreme Court answered the question as to when the clock for calculating the limitation period would begin to run for Appeals filed under the Code and recorded the same in Paras 33 through 35, after taking into due consideration the provisions of Rule 22(2) of the NCLAT Rules, 2016, Section 12 of the Limitation Act, and Section 421 of the Companies Act holding that While it is true that the tribunals, and even this Court, may choose to exempt parties from compliance with this procedural requirement in the interest of substantial justice, as re-iterated in Rule 14 of the NCLAT Rules, the discretionary waiver does not act as an automatic exception where litigants make no efforts to pursue a timely resolution of their grievance. The appellant having failed to apply for a certified copy, rendered the appeal filed before the NCLAT as clearly barred by limitation.
Neither the provisions of the NCLAT Rules, 2016 nor the Code bars the Appellant from filing an Appeal within the statutory limitation period provided for under Section 61(3) of the Code and requesting the erstwhile RP to seek a certified copy and awaiting the outcome of the Liquidation Application, further renders the argument of the Learned Counsel for the Appellant, that the delay may be condoned for the foregoing reasons, unsustainable - there are force in the contention of the Learned Senior Counsel for the First Respondent that the Appellant, having 85% of the voting share in the CoC of the Corporate Debtor, ought to have taken effective steps within the limitation period, which they have failed to do so.
The reasons given by the Applicant/Appellant do not constitute ‘sufficient cause’ for the Appellant to have filed the Appeal on the 45th day - Appeal dismissed.
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2023 (12) TMI 1072
Validity of approved Resolution Plan - Appellant submitted that the Adjudicating Authority has erroneously allowed the Application seeking Liquidation on the ground that the Appellant had not adhered to the terms of the Resolution Plan - HELD THAT:- Admittedly there were several rounds of discussions held and the Appellant sent a letter dated 12.08.2021 where it sought for modification for the repayment Plan promising to deposit Rs.25 Crores in a no-lien account and a balance 15 Crores within three weeks from the date of approval - there are force in the contention of the Learned Counsel for the First Respondent that though the other CoC members, SBI and IDBI, did not accept the modified payment terms, the First Respondent being the majority voting shareholder of the CoC accepted the modified payment terms way back on 29.09.2021, but the Appellant did not comply with the terms and hence, no further opportunities are required to be given.
It is evident from the record that though almost two and half years has lapsed from the date of approval of the Plan and several opportunities were given to the Appellant and the modified payment terms were also accepted by the First Respondent, even then the Appellant did not pay the required amount of Rs. 83.07Cr by November 2021. Therefore, the contention of the Learned Counsel for the Appellant that if the Appellant is allowed to manage the Corporate Debtor Company, the Appellant shall repay the money to the Bank in a ‘short period’, is untenable, specifically having regard to the fact that the Plan was approved way back in 2019, IBC is a time-bound process, and several opportunities were given for implementation of the original Plan as well as the modified Plan.
Keeping in view the law laid down by the Hon’ble Apex Court in EBIX SINGAPORE PRIVATE LIMITED VERSUS COMMITTEE OF CREDITORS OF EDUCOMP SOLUTIONS LIMITED & ANR., KUNDAN CARE PRODUCTS LIMITED VERSUS MR AMIT GUPTA AND ORS. AND SEROCO LIGHTING INDUSTRIES PRIVATE LIMITED VERSUS RAVI KAPOOR RP FOR ARYA FILAMENTS PRIVATE LIMTIED & ORS. [2021 (9) TMI 672 - SUPREME COURT], wherein the Hon’ble Apex Court has clearly emphasised the importance of adhering to strict timelines, keeping in view the scope and objective of the Code - In the instant case as the Appellant / SRA could not implement the Resolution Plan within the specified time, the Adjudicating Authority has rightly, as provided for under Section 33 of the Code, allowed application filed by the Monitoring Committee of Scott Garments and Canara Bank respectively, seeking Liquidation.
Appeal dismissed.
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2023 (12) TMI 1071
Sabka Viswas Scheme (SVLDRS) - petitioner not able to pay the demanded amount in time - HELD THAT:- In W.P.No.24366 of 2021 [2023 (11) TMI 899 - MADRAS HIGH COURT], a similar set of facts was already considered and a detailed order was also passed by this Court where it was held that this Court is of the view that the application, filed on 13.02.2023 consequent to the payment made by the petitioner, has to be accepted under the SVLDRS scheme by the respondent and in such view of the matter, this Court has no hesitation to direct the respondent to issue Form SVLDRS-4 to discharge the tax liabilities within a period of 30 days from the date of receipt of copy of this order.
The impugned order dated 24.08.2021 is set aside. Further, the 2nd respondent is directed to accept the payment made by the petitioner in terms of Form SVLDRS 3 and issue a Certificate of Settlement in Form SVLDRS 4 within a period of four weeks from the date of receipt of copy of this order - the writ petition is allowed.
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