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Showing 21 to 40 of 1721 Records
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2024 (9) TMI 1704
Detention of the goods and vehicle of the petitioner - whether the goods may be released by the authorities under Section 129(1)(a) of the CGST Act read with IGST Act on value of goods mentioned in invoice? - HELD THAT:- The goods would have to be released in terms of Section 129(1)(a) of the CGST Act read with IGST Act on the value of goods mentioned in invoice.
The order passed by the authorities dated September 1, 2024 is quashed and set aside. The respondent authorities are directed to carry out the exercise in terms of Section 129(1)(a) of the CGST Act read with IGST Act within a period of three weeks from today on the basis of valuation as specified in the invoice.
Petition allowed.
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2024 (9) TMI 1703
TP Adjustment - Admit the appeal on substantial questions of law.
“(1) Whether on the facts and in the circumstances of the case and in law the Hon'ble Tribunal was justified in holding that Working Capital adjustment can be made to the arms length operating margin of the comparables under Rule 10B (1)(e)(iii) of the Income Tax Rules, 1962?
(2) Whether on the facts and in the circumstances of the case and in law the Tribunal was justified in holding that adjustment on account of higher import cost to the arms length operating margin of the comparables can be made under Rule 10B(1)(e)(iii) of the Income Tax Rules, 1962?
(3) Whether on the facts and in the circumstances of the case and in law the Hon'ble Tribunal was justified in granting deduction of 5% when multiple prices in establishing the arithmetic mean were involved even though the same is contrary to the proviso to Section 92C(2) as amended with effect from 1.10.2009?
(4) Whether on the facts and in the circumstances of the case and in law the Hon'ble Tribunal was justified in holding that Transfer Pricing adjustment is to be made only with reference to sales related to the import of components and spares procured from Associated Enterprises and not to the entire sales of the manufacturing segment of the Assessee?
The respondent waives service.
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2024 (9) TMI 1702
Unexplained cash credit u/s 68 - unaccounted commission - protective additions made at the hands of the assessee - HELD THAT:- As per observations of FAA since, the real beneficiaries, who have availed the accommodation entries were identified, the substantive additions have been made at their hands. That being the case, protective additions made at the hands of the assessee cannot survive.
While considering identical nature of dispute arising in the case of similarly situated companies, allegedly managed and controlled by Jain Brothers, the Coordinate Bench in the cases M/s. Shivji Garments Pvt. Ltd. [2024 (2) TMI 454 - ITAT DELHI] and M/s. Zed Enterprises (P) Ltd.[2024 (1) TMI 1442 - ITAT DELHI] has upheld the decision of learned first appellate authority in deleting the addition. The factual position being identical in the present appeals, we do not find any infirmity in the decision of learned first appellate authority in deleting the additions. Revenue Grounds are dismissed.
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2024 (9) TMI 1701
Addition on account of undisclosed sources u/s 68 - unexplained entries in bank account - HELD THAT:- The case of the assessee for the above mentioned AYs is squarely covered by the decision of Zed Enterprises (P) Ltd 51869984 held the assessee company has received funds from various concerns as mentioned above and thereafter amounts were transferred to the above-mentioned companies/concerns immediately, thus the appellant company is not beneficiary company. CIT(A) also obtained the remand report from the AO and held that the AO has verified the fund flow statement depicting the source of funds and utilization of the same for payments to beneficiaries submitted by the assessee.
CIT(A) held that it was found which established that the Sh. Anand Jain and Sh. Naresh Kumar Jain were operating bank accounts in the names of various concerns/companies through which accommodation entries were being provided and the appellant company was one of such shell concerns. Further the beneficiaries of such accommodation entries were also identified and information to their respective AOs was also disseminated as mentioned in the assessment order as well as the remand report.
CIT(A) held that as far as charging of commission is concerned in the case of the assessee, it has been held by the AO in the assessment order that Sh. Anand Jain and Sh. Naresh Jain were entry operators who were managing and controlling various shell concerns including the appellant for providing accommodation entries in lieu of commission and taking that logic there is no question of charging of commission income in the hands of the appellant company arises, since nothing has been earned by the company, being the shell concern.
Since, the commission already stands taxed in the hands of the entry operators in their individual capacity, no separate commission can be charged in the hands of the pass through/ companies floated by the entry operators. As the assessee is found to be one of such pass-through entity, we decline to interfere with the order of the ld. CIT(A) in deleting the commission charged.
We therefore, are in agreement with the above extracted observations/findings in present case are squarely covered by this case. Decided against revenue.
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2024 (9) TMI 1700
Addition u/s 43CA - difference between the market value as per Stamp Duty Authority and Agreement value - HELD THAT:- Since in the present case, excess of stamp duty value over the sale consideration is less than 5% of the sale consideration, we are of the considered view that the provisions of section 43CA of the Act are not applicable to the present case. On this short ground only the assessee is entitled to relief. Appeal by the assessee is allowed.
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2024 (9) TMI 1699
Validity of intimation u/s 143(1) passed without granting opportunity to the assessee, wherein an adjustment was made that was debatable in nature - HELD THAT:- Where a claim was made which require further inquiry, it cannot be disallowed without hearing the parties and / or giving the opportunity to submit proof in support of its claim.
Hon’ble Bombay High Court in Bajaj Auto Finance Ltd. [2018 (2) TMI 1716 - BOMBAY HIGH COURT] thus observed that, debatable issues cannot be adjusted by way of intimation u/s 143(1)(a), which would lead to an arbitrary and unreasonable intimation being issued leading to chaos. Also see JKs Employees Welfare Fund [1992 (3) TMI 41 - RAJASTHAN HIGH COURT] Ground No. 1 of the assessee stands allowed.
Income of the assessee chargeable to Normal Tax rates or the Maximum Marginal Tax rates - AR submitted that, provisions of Section 164(2) of the Act governs the case of a registered charitable trust which is the case of the present assessee and the tax should be charged accordingly to Section 164(2) - HELD THAT:-Section 164 is a special provision that prevails over the general provision of Section 167B. The decision of Marsons Beneficiary Trust [1990 (7) TMI 37 - BOMBAY HIGH COURT] has considered the fact in a case of a Trust, where the beneficiaries in the share was determinate and therefore, Hon’ble Court held that the earnings on behalf of such Trust would be taxed as an AOP.
As a corollary in the present facts, the share of the beneficiaries are not known though the assessee in the return of income mentioned itself to be an AOP and therefore provisions of Section 167B are not applicable. If we analyze the alternative plea raised that the assessee had not claimed any exemption under Sections 11 and 12 for the year under consideration therefore, there not being a situation of denial of exemption under Sections 13(1)(c) or 13(1)(d) the assessee come within the ambit to subject that portion of income to the maximum marginal rate. Accordingly, assessee cannot be subjected to maximum marginal rate for the year under consideration merely because it filed its return of income in form ITR – 7 as against ITR – 5. Ground No. 2 raised by the assessee stands allowed.
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2024 (9) TMI 1698
Penalty u/s 271(1)(c) - defective notice u/s 274 - non specification of clear charge/Default - HC decided [2023 (8) TMI 1373 - DELHI HIGH COURT] Revenue does not dispute that none of the penalty notices issued to the respondent/assessee for the aforementioned AYs advert to the specific limb of Section 271(1)(c) which is triggered against him.
It is not clear whether the AO intended to levy a penalty on the respondent/assessee for concealment of particulars of his income, or furnishing inaccurate particulars.
HELD THAT:- There is gross delay of 371 days in filing this Special Leave Petition.
Delay in refiling is condoned.
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2024 (9) TMI 1697
Accrual of income in India - treating the payments made to the foreign Companies towards purchase of licensed software as 'royalty' u/s 9(1)(vi) - HELD THAT:- Taking note of the above, in terms of the order passed by the Hon'ble Apex Court in the case of ENGINEERING ANALYSIS CENTRE OF EXCELLENCE (P.) LTD. [2021 (3) TMI 138 - SUPREME COURT] we answer the above question of law in favour of the Assessee and against the Revenue.
Revenue as submits that the Revenue has preferred Review Petition before the Hon'ble Apex Court praying to review the order passed in the case of ENGINEERING ANALYSIS CENTRE OF EXCELLENCE (P.) LTD., we deem it appropriate to grant liberty to the respondent- Revenue to file review petition based on the outcome of the review pending before the Hon'ble Apex Court and it is for the respondent-Revenue to make out a case for review.
Till then question of law is answered in favour of the Assessee
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2024 (9) TMI 1696
Disallowing deduction under chapter VI -A in respect of section 80P - case of Co-operative Society in the remote Village of Himachal Pradesh and this Society is providing banking/credit facilities to its members - ACIT/ JCIT(A) provisions of section 80A(5) and on that basis he has rejected the claim of the Assessee.
HELD THAT:- Section 80A(5) is broadly applied where any deduction is to be claimed u/s 10A or section 10 AA or section 10(B) or section 10BA etc. Here, in this case, the Assessee is a cooperative society and it has to be allowed deduction u/s 80P(2)( c)(i) so, it has got nothing to do with section 80A (5) of the Act.
We have considered the case laws brought on record by the ld. Counsel of the Assessee and we find that there are number of case laws supporting view that in case there is a mistake by Assessee for claiming legitimate deduction, the AO is duty bound to consider such legitimate deduction to the Assessee even if it was not claimed or claimed under wrong sections. No justification in the findings given by the Addl/JCIT (A) and so it cannot be sustained, thus Assessee’s appeal on this issue is allowed.
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2024 (9) TMI 1695
Non-imposition of penalties u/s 114A and 114AA of the Customs Act, 1962 - evasion of customs duty by mixing two separate consignments/cargos after getting let export orders from the authorities - HELD THAT:- While arriving at his findings concerning the determination of the iron percentage content in the export cargo, the adjudicating authority has specifically noted that on WMT basis the iron ore content in various consignments of the export cargo stood below 58% both shipping bill wise as well as on the entire/full cargo load basis and therefore the question of demand of differential duty on entire/full cargo loaded on the basis of private test agencies deriving iron content on DMT basis would not hold good.
The department's premise in the matter for determination of iron content in the iron ore without considering moisture content i.e. on DMT basis is against the settled law as indicated supra. Multiple pronouncements by various authorities on the subject have reckoned the determination of iron content on WMT basis and the department is bound therewith. On the valuation aspect the Ld.Commissioner has exhaustively discussed the matter in his impugned orders. It is further on record that the BRCs concerned with the shipments establish nothing more than the transaction value as declared by the exporters.
An identical issue was considered by the Coordinate Bench of the Tribunal in the case of CC(Prev.), BBSR. V. Chamong Tea Exports Pvt.Ltd. [2024 (8) TMI 1525 - CESTAT MUMBAI], whereto the appeal filed by the Revenue was dismissed and the entire consignments, were even though held as consolidated consignments, the iron content arrived at on WMT basis being less than 58% were held to be not non-dutiable. Consequently, liability for payment of duty, penalty etc. were all dismissed.
Merely on the premise of mixing of the cargo, post the issuance of the let export order cannot justify the claim for demand of duty on the entire lot, when there is nothing contrary to hold Fe% being more than the dutiable threshold, when arrived at on WMT basis - There are no merit in the learned adjudicating authority, imposing penalty under Section 114AA on the respondents herein.
As for the employee Ajay Gupta the crucial reason for imposition of penalty, is that he was found to be in possession of invoices pertaining to export of iron ore fines that were loaded into the vessels. This is no plausible reason and the penalty imposed is liable to be set aside, as the said invoices could not be connected to the impugned shipment. Having found commissioning of no wrong we fail to appreciate the logic for imposition of any such penalty on each of the respondents. In view of the findings above, there are no reason in the proposal of the Revenue to impose penalty under Section 114A of the Customs Act on the respondents. There is nothing on record, intentional or otherwise, to establish the usage of such material that has been found to be false or incorrect in any material particular, therefore any penalty on that account is certainly not imposable in the matter.
Conclusion - i) The determination of Fe content on a WMT basis is crucial for assessing export duty liability. ii) The absence of evidence for intentional evasion or false declarations negates the imposition of penalties under Sections 114A and 114AA of the Customs Act.
The Revenue's appeals are liable to be quashed and are therefore dismissed.
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2024 (9) TMI 1694
Challenged the issuance of a show cause notice - No material whatsoever or no assertion in the show cause notice - Invocation of the extended period of limitation under Section 74 of the CGST/SGST Act - HELD THAT:- This writ petition will stand disposed of directing that if the petitioner was to file his reply to Ext.P1 show cause notice, also objecting to the invocation of the extended period of limitation, the question as to whether there was any reason to initiate proceedings under Section 74 of the CGST/SGST Act will be considered as a preliminary issue by the 2nd respondent and an order shall be passed on that issue before proceeding further with the adjudication of Ext.P1 show cause notice. The petitioner shall file a reply to Ext.P1 show cause notice within a period of two weeks from the date or receipt of a certified copy of this judgment. The petitioner shall appear before the 2nd respondent through Authorised Representative, thereafter, the matter shall be adjudicated as directed above.
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2024 (9) TMI 1693
Seeking grant of bail - allegations are that the petitioner, who was Private Secretary to the Chief Minister of Delhi, assaulted the complainant-victim, who is a Member of Parliament for Rajya Sabha from Delhi, at the time when she entered the residence of the Chief Minister of Delhi - HELD THAT:- In the quest to strike a balance between `liberty’ on one hand and `a fair trial’ on the other, it is appreciated that the concern of the prosecution that the witnesses must be kept free from any kind of extraneous pressure or influence to enable them to depose fearleslly. It is satisfying that the desired protection can be afforded through various alternative measures including by imposing such reasonable terms and conditions which would prevent the propensity to influence the witnesses or tamper with the evidence. In any case, any such attempt by the beneficiary of a discretionary jurisdiction of the Court, will amount to misuse of concession of bail and the necessary consequences would, thus, follow.
Taking into consideration the totality of the circumstances, however, without expressing any opinion on the merits of the case, it is deemed appropriate to release the petitioner on bail - The petitioner is, accordingly, directed to be released on bail subject to such terms and conditions that may be imposed by the Trial Court.
Bail application allowed.
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2024 (9) TMI 1692
Unexplained income u/s 69A - Cash deposits in the three bank accounts - HELD THAT:- We note from the submissions of the assessee before the CIT(Appeals) that the cash deposits are out of sale proceeds and unsecured loans. Therefore it is evident that the assessee has deposited cash in the bank account from his business turnover on which assessee had declared business profit. Both the authorities below have not reduced the profit element involved in the business turnover and corresponding expenditure.
Both the authorities have considered the income twice i.e., under the profits & gains of business or profession under Chapter IVD on the turnover and income from other sources u/s. 69A.
Resultantly there is double taxation on the same income which is not permitted. Once the cash deposit out of the turnover is treated as unexplained investment u/s. 69A, the actual turnover which is not part of the bank deposits has to be calculated. It
Partial cash transaction on the same modus operandi followed by the assessee has been accepted which is not subject matter of the appeal. We also note that the assessee has filed VAT return disclosing the entire turnover shown in the financial statements. Therefore, both the authorities are not justified in making addition u/s. 69A of the Act.
Rejection of books of accounts - As once the books of accounts are rejected by the ld. FAA, he should have applied income u/s. 144 of the Act, however he has accepted income disclosed by the assessee. It is also noted that the assessee is an eligible assessee u/s. 44AD and he has disclosed income @ 9.92% u/s. 44AD. The amount deposited in the bank account is less than the turnover declared by the assessee.
Both the authorities below are unable to substantiate the bank deposits are over and above the turnover declared by the assesse.
Cash deposits in the above three bank accounts were treated income u/s. 69A is not correct. Therefore income declared by the assessee under the head profits & gains of business or profession has to be accepted. Ground Nos.1 to 6 are allowed
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2024 (9) TMI 1691
Denial of concessional tax rate u/s 115BAA - non-filing of Form 10IC electronically before the due date - HELD THAT:- As not disputed that for claiming tax rate u/s 115BAA Assessment Year 2020-21 is the very the first Assessment Year and due to the fault on the part of the System as mentioned by the assessee, it would have happened that the assessee has not filed the Form alongwith the return of income.
It is not the case of the Revenue that the assessee is not entitled for the tax rate u/s 115BAA. If the assessee had filed Form 10IC within the prescribed time alongwith return of income, as held by various Hon’ble High Courts including the jurisdictional High Court, the CIT (A) has co-terminus power as that of the AO.
CIT (A) is required to consider the report in Form 10IC and, therefore, it will be appropriate to take on record the Form 10IC and consider the same in consonance with the return of income filed by the assessee and after verifying the same, the AO will adjudicate the issue. Assessee appeal partly allowed for statistical purpose.
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2024 (9) TMI 1690
Waiver of penalty - recovery of dues - HELD THAT:- It seems that the petitioners company submitted a letter on 28.03.2022 requesting for conversion of outstanding liability into monthly instalments, which was allowed by the concerned Assistant Commissioner.
The issue, therefore, stood closed at that level itself with regard to the aspect regarding waiver of penalty. A presumption has to be drawn in terms of the aforesaid communications that the authorities as well as the petitioner himself did not press further for waiver of penalty and has later on insisted for waiver of penalty, vide its letter dated 21.08.2024.
In the circumstances, it is a case where the petitioners seek to revive what they had already accepted earlier, and had also deposited the amount.
Petition dismissed.
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2024 (9) TMI 1689
Scope and interpretation of Section 66A of the Finance Act, 1994 - branch office for the purpose of section 66A was distinct entity from the head office - Reverse charge mechanism.
Whether the tribunal has rightly in case of British Airways [2014 (6) TMI 626 - CESTAT NEW DELHI (LB)] held that the payments made by the Head Office against the service received by the branch office located in India, will make the Head Office the recipient of service, for the purpose of Section 66A of the Finance Act, 1994? - HELD THAT:- The two conflicting decisions of the Tribunal are in British Airways and Cathay Pacific Airways.
In British Airways, the Tribunal held the India branch office of the International Airline cannot be held to be the recipient of services provided by CRS companies and liable to pay service tax on reverse charge basis under section 66A of the Finance Act. - However, in Cathay Pacific Airways [2019 (10) TMI 890 - CESTAT MUMBAI], the division bench held that independent identity of branch office or head office is not the criteria for determination of liability to service tax in terms of section 66A of the Finance Act. The relevant criteria for determination of liability to pay service tax would be the place of business of recipient of service in cases where the provider of service is located outside India.
For OIDAR services rendered by a service provider from outside India to be subject to service tax in India under section 66A of the Finance Act, it is necessary that the service should be received by the service recipient located in India - the India branch office of the International Airline cannot be considered as a service recipient under section 66A of the Finance Act. It is the head office that would be the recipient of services provided by the CRS/GDS companies located outside India.
The second proviso to section 66A(1) of the Finance Act states that location of establishment of service provider most directly concerned with provision of service has to be seen. It is silent about relevant establishment of the service recipient. It needs to be noted that paragraph 26.5 of CBEC Circular dated 27.07.2005 provides that the establishment most directly concerned with receipt of service has to be seen, even when Explanation to section 65(105) of the Finance Act is silent about it. Therefore, for purposes of section 66A of the Finance Act also, the establishment most concerned with the receipt of service alone will be relevant.
Where the service recipient has more than one establishment, the establishment most directly concerned with the receipt of service has to be seen.
Reverse charge mechanism - HELD THAT:- The entire basis for reference to the larger bench by the division bench is the judgment of the Supreme Court in Formula One [2017 (4) TMI 1109 - SUPREME COURT] in reference to the provisions of the Income Tax Act, 1961. The division bench of the Tribunal, basis the decision of the Supreme Court Formula One, concluded that the branch office of Cathay Pacific located in India is the place of business of Cathay Pacific Airlines in India and so the services received by the branch office in India from the CRS companies for facilitating the booking of tickets through travel agents in India are services received in India. The reference order, therefore, proceeds to hold that the branch office of the International Airline in India would be liable to pay service tax in terms of section 66A of the Finance Act under reverse charge as the criteria for determining applicability of service tax under section 66A of the Finance Act is the place of business in India.
The appellant does not dispute that it has a place of business in India. What the appellant disputes is that the place of business in India is not the recipient of service.
The branch office in India is not the recipient of OIDAR services provided by CRS companies. It is the head office which is contractually entitled to receive the services rendered by the CRS/GDS companies and it is the head office which is contractually obligated to make payment for the services rendered by the CRS/GDS companies.
Conclusion - i) For the purpose of levy of service tax under reverse charge under section 66A of the Finance Act, the services should have been received in India by the recipient from the service provider who does not have any permanent establishment in India. The appellant, in the present case, is not the recipient of service and it is the head office located in Hong Kong that is the recipient of service. As the appellant has not received any service, it cannot be held liable to pay service tax in respect of the services rendered by the foreign CRS/GDS companies to the head office located outside India. ii) In the present case, the Commissioner has recorded a finding of fact that the branch office and the head office are two separate persons. This issue would, therefore, not arise for consideration. In any case, it has been found as fact that the branch office and the head office are two separate persons. iii) The issue that arose for consideration in British Airways was whether the branch office was the recipient of service or not. The issue, therefore, that has been referred is beyond the dispute decided in British Airways. In any view of the matter, the branch office has not received any service from foreign CRS/GDS companies and it is the head office alone which has received the services and made payment. The appellant, which is the branch office, cannot be held liable to pay service tax under reverse charge under section 66A of the Finance Act.
The papers may now be placed before the division bench for deciding the appeal on merits.
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2024 (9) TMI 1688
TP Adjustment - overseas entities of the assessee treated as deemed Associated Enterprises (AEs) u/s 92A - HELD THAT:-As observation that a sensible meaning deserves to be adopted to the expression “influence” which is integral in the scheme of transfer pricing provision has been found to be correct.
As rightly held the meaning had to be a dominant influence leading to a de facto control over another enterprise rather than an influence simplicitor. Adoption of literal meaning of influence would lead to all the transactions on the negotiated prices being hit by section 92A(2)(i). Considering a small component of sales exports made to AE’s out of its total sales exports, the presumption of the AE being in a dominant position to exercise any “influence” cannot be made.
Consequently, in respectful compliance to the decision of this tribunal in [2016 (12) TMI 236 - ITAT CHENNAI] we hold that the impugned overseas entities cannot be regarded as deemed AE’s of the assesse. Accordingly, grounds of appeal No.1 to 3 and 6 to 11 raised by the assessee are allowed.
Upward TP adjustments made u/s 92CA(3) - determination of ALP by the Ld. TPO - method of ALP to be adopted i.e TNMM - aggregate of transactions with ALPs viz-a-viz individual transactions with AE’s challenged - HELD THAT:- We find that the OECD guidelines referred by the assessee comes to its rescue. We further note that a transaction defined in rule 10A(d) includes a number of closely linked transaction. Consequently for a comparability analysis a number of similar transaction may be required to be aggregated as Indian TP regulations do not have any guidelines for aggregation beyond the norm of closely linked transactions, reliance is required to be made to OECD and American guidelines. According to s 482-1-1(f)(2)(i) of the US regulation the combined effect of two or more separate transactions may be considered if such transactions taken as a whole are interrelated. It thus postulates that transactions are to be aggregated when they involve related product / services.
We have also noted that in the case of Mainetti India Pvt. Ltd. [2012 (7) TMI 117 - ITAT CHENNAI] has, ruling on nearly identical facts postulated that fairness requires that while determining ALP a TPO must consider all transaction i.e those where margins were lower as well as those where margins were higher to arrive at holistic picture. The argument of the Ld. CIT(A) that the said decision is distinguished on the basis of being relevant to CUP method only and not TNMM is misplaced.
We hereby direct the TPO to recompute the ALP following the ratio laid down in [2012 (7) TMI 117 - ITAT CHENNAI] - TPO would be required to give all opportunities of being heard to the assessee who shall comply with all the notices issued to him in this regard. Accordingly, the ground of appeal raised by the assessee are allowed for statistical purposes only.
Appeals of the assessee are partly allowed.
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2024 (9) TMI 1687
Money Laundering - provisional attachment order - recipient of proceeds of crime - appellant has not been named as an accused either in the FIR or in the ECIR but his property has been attached begin recipient of the proceeds of crime - absence of prosecution complaint within 365 days from the date of the order passed by the Adjudicating Authority - HELD THAT:- The fact is that no evidence exist to show any legal advice to the accused company and in fact the appellant could not produce any evidence to support his claim for receipt of the amount towards the professional charges. It is when the statement of the appellant was recorded u/s 50 of the Act, 2002 on 30.07.2019 and 31.07.2019. As per his statements, he interacted only with accused i.e. Chetan Jayantilal Sandesara and he did not interact with any other person for legal advice which included even any officer of the legal department - The amount received by the appellant was not a small amount rather it was Rs. 2,07,25,500/- even as per the statement of the appellant. The aforesaid amount towards alleged legal advice could not be substantiated and therefore respondents rightly arrived at the conclusion it to be the proceeds of crime transferred to the appellant by none else but the main accused thus, on the facts on record, this is not a case in favour of the appellant.
Section 8(3)(a) of the Act provides for thecurrency to the order of attachment during the investigation to be completed within 365 days or the pendency of the proceeding in a court relating to any offences under the Act of 2002. The period of interim order precluded the respondents to file the prosecution complaint cannot be taken to the benefit of the appellant and thereby we are unable to accept the arguments of the appellant regarding lapse of the order of provisional attachment or as to its confirmation. The explanation to Section 8(3) of the Act, 2002 has been ignored by the appellant which excludes the period of an interim order of the court from the period of 365 days.
Assuming predicate offence of robbery take place and FIR is registered followed by an ECIR against the accused. The proceeds of crime is parked by the accused with third person who may then purchase the property after that or keep the money parked with him. The respondents would be within their right to attach or seize the property in the hands of third person though he is not an accused. This is to protect the property obtained out of the crime. If the argument of the appellant is accepted, then despite the proceeds of crime in the hands of a person other than the accused, it can not be attached or seized and if at all it is attached or seized,the investigation has to be completed against such person within 365 days. This would be nothing but showing requirement to complete the investigation against a person who is not even an accused and need not to be. The seizure or attachment is because the property or related document may be with a person other than an accused.
As per the judgment of the apex court in Vijay Madanlal Choudhary [2022 (7) TMI 1316 - SUPREME COURT (LB)] it is not necessary that the attachment can be of the property only of the accused rather it is of the proceeds of crime whether in the hands of the accused or with the other person or it can be for value equivalent.
Conclusion - It is not necessary that the attachment can be of the property only of the accused rather it is of the proceeds of crime whether in the hands of the accused or with the other person or it can be for value equivalent.
Appeal dismissed.
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2024 (9) TMI 1686
Application for pre-trial bail - money laundering - proceeds of crime - scheduled offences - applicant is entitled to bail under Section 45 of the PML Act or not - HELD THAT:- An attempt has been made to indicate that the amount as shown by the prosecution as received by the applicant as proceeds of crime is nothing but hard earned money of the applicant. The said amount is said to be her saving from her part of salary which she invested as well as money she earned from the sale and purchase of agricultural and commercial land and also part of her income she derived from sale and purchase of cow milk and other dairy products and from agricultural income apart from the monetary help extended to her by her husband and children.
The record would further indicate that large number of documents were recovered from the premises/house of the applicant. The details of which have been mentioned in ECIR, Clause 3.4. The nature of the documents so recovered are certain FIRs lodged against the applicant relating to the year 2016. Documents indicating investments made in PIP Plan of Shine City Infra Project relating to Ajay Pal, Kuldeep Singh, Ram Awadh Yadav and the applicant herself.
It could not be explained by the applicant as to why there large number of original sale deeds belonging to third parties were present at the residence of the applicant. Thus, in absence of any plausible reason, either the properties have been parked in names of third parties to cerate a smokescreen to evade it being traced to the applicant or the applicant has deep rooted connections to hold on to said documents for third parties for some ulterior gains.
Merely to suggest that a sum of Rs. 16,00,000/- and odd has been shown as proceeds of crime and the applicant being a school teacher and later promoted to the post of Headmaster between the year 2009 to 2020 had the means to garner such amount which was in her account and it cannot be treated as an alarming figure.
The applicant could have easily indicated her source of income from agricultural activities if she could give details of the extent of her landholding but it has not been done. No details were given to show how much live stock she had from where she could substantially earn by the sale of milk and dairy products - In absence of such material or explanation to justify the documents, data and amount found with the applicant such as third party sale deeds, plot buyer agreements, e-payment receipts which if seen in juxtaposition to the language of Section 3 of The PML Act of 2002 which provides that any act of a person engaged directly or indirectly being connected or associated with proceeds of crime or even being involved in concealing, possessing, acquisition or use or projecting as untainted property, all such acts falls within Section 3 of The PML Act of 2002.
Conclusion - This Court is unable to persuade itself to form a, prima facie, satisfaction in terms of Section 45 of The PML Act of 2002, at this stage, that the applicant is not guilty or that she may not commit an offence on bail.
Bail application is rejected.
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2024 (9) TMI 1685
Issuance of assessment order in the name of a deceased person - Entire adjudication/assessment proceeding commencing with issuance of show cause notice, dated 28.03.2022 has been made in the name of the petitioner's father, who had died on 19.05.2021 - non-existing entity/person - HELD THAT:- A reading of Section 93 would show that Clause (a) only provides that if a business carried on by the person is continued by the legal representative or any other person after his death, such legal representative or other person, who continues, shall be liable to pay tax, interest or penalty, while Clause (b) provides that if the business carried on by the person is discontinued, whether before or after his death, his legal representative shall be liable to pay, out of the estate of the deceased, to the extent to which the estate is capable of meeting the charge, the tax, interest or penalty.
Under the GST Act, in the case of original assessee being a dead person it may be necessary to make the assessment in the name of the legal heirs. The assessment in the name of the dead person more so when the factum of his death has already been informed by the respondent authority, vitiates the entire proceeding. The above defect is a substantive defect. Participation in the assessment proceeding by the legal representative cannot cure the above defect.
Conclusion - An assessment order cannot be validly issued in the name of a deceased person under the GST Act. Legal heirs must be notified and involved in the assessment process to ensure validity.
Petition disposed off.
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