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Showing 101 to 120 of 668 Records
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2008 (10) TMI 643
Issues involved: Appeal u/s 260A of Income Tax Act against ITAT judgment regarding treatment of sum as business income or long term capital gain for assessment year 1992-93.
Summary:
1. The Assessing Officer treated a sum as business income instead of long term capital gain based on lack of separate account maintenance and nature of shares traded.
2. The CIT(A) directed to treat the sum as long term capital gain considering the history of share transactions, separate account maintenance, and lack of evidence of conversion into stock-in-trade.
3. The Tribunal upheld CIT(A)'s decision, noting separate account maintenance for shares held as stock-in-trade, no evidence of treating shares as stock-in-trade in earlier years, and proper tax compliance.
4. High Court found no interference needed as Tribunal and CIT(A) established the shares were held as investment and not treated as stock-in-trade in previous years, dismissing the appeal.
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2008 (10) TMI 642
Claim of exemption u/s 10BA - income from the business of manufacturing, trading and exporting of handmade wooden handicraft antique furniture - whether the activities tantamount to manufacturing/production - HELD THAT:- We find the contention of the learned CIT departmental Representative contradictory inasmuch with regard to the certification by the customs authorities as to the nature of the export of the disputed articles of being of artistic value, whereas by drawing inferences only, it is argued that no activity was carried out and it was a matter of simple purchases.
Such an approach of the revenue is disapproved. We further agree with the contention of the learned Counsel that the use of the machinery is only to prepare the wood purchased by the appellant with a view to make it fit for further technical steps to be carried out by artisans. It is nothing but a preparatory stage, before handwork is commenced. The machine work is confined to seasoning of wood which normally contains moisture, thickness plaining and cutting. Further the objections as regards the shortfall of workers the required number i.e. 20 u/s 10BA(2)(e) also not factually correct. A perusal of copies of the wages registers submitted to assessing officer (paper book 23-72) clearly show that there were more than 20 workers in any case throughout the year engaged in the manufacturing activities. There apart the other karigars being paid on piece rate basis are also the persons engaged and deserve consideration for this purposes. Even the learned Commissioner (Appeals) has also now recorded a finding that the assessee had employed more than 20 workers as required u/s 10BA.
The heavy reliance placed by the revenue on the decision of Kwal Pro Exports [2006 (10) TMI 193 - ITAT JODHPUR] is also misplaced, the Tribunal placed reliance upon the Third Member decision in case of Arihant Tiles & Marbles (P) Ltd. v. ITO[2006 (6) TMI 157 - ITAT JODHPUR]. However, the same now stands reversed in the case of Arihant Tiles & Marbles (P) Ltd. v. ITO [2007 (5) TMI 132 - HIGH COURT, RAJASTHAN].
Moreover, there is a specific definition of the eligible article u/s 10BA, which is not the case u/s 10B with which Kwal Pro Exports [2006 (10) TMI 193 - ITAT JODHPUR] was concerned. Therefore, the said decision cannot be applied being totally distinguishable. It has been held that an incentive provision has to be construed liberally as held in Bajaj Tempo Ltd. [1992 (4) TMI 4 - SUPREME COURT]. The present case also helps achieving the avowed object. Once the underlying purpose of an enactment is served, there is no reason why the deduction should be restricted on one pretence or order.
Recently in CIT v. Baby Marine Exports [2007 (3) TMI 206 - SUPREME COURT], the Hon'ble Supreme Court strongly advocated for a liberal interpretation. It was held that Section 80HHC was incorporated with the object of granting incentive to earners of foreign exchange. This court is Sea Pearl Industries v. CIT[2001 (1) TMI 78 - SUPREME COURT] also observed that the object of selection Section 80HHC is to grant incentive to earners of foreign exchange. In IPCA Laboratory Ltd. v. Dy. CIT [2004 (3) TMI 9 - SUPREME COURT] this court has taken the same view. This court in the said judgment observed that Section 80HHC has been incorporated with a view to provide incentive to export house and this Section must receive liberal interpretation.
Thus, we are fully satisfied that the appellant was engaged in the manufacturing and production of the eligible articles under the provisions of Section 10BA and hence the appellant is fully entitled to get the deductions. The assessing officer is therefore directed to allow the same. Thus ground No. 2 of the assessee is allowed.
Disallowance of interest payment u/s 40A(2)(b) - HELD THAT:- It has been explained that the rate of interest was @ 15 per cent and not @ 18 per cent p.a. The market rate of interest on loan from bank is though 15 per cent p.a. but including several types of other charges and cost the effective rate of interest is 18 per cent p.a. Various other formalities of hypothecation and pledge are also required in the case of bank loan. Moreover, the assessing officer has not brought on record that interest paid is excessive or unreasonable. In the circumstances and facts of the case, the assessing officer is not justified in disallowing the interest. The same is directed to be deleted.
Thus, ground No. 5 of the assessee is allowed.
As regard the disallowance made, the assessing officer failed to appreciate that the gross profit rate declared by the assessee during the impugned year was 21.35 per cent as compared to gross profit rate of 19.68 per cent in the immediately preceding year. The increase in expenditure on account of firewood expenses and seasoning charges has been duly explained which has not been taken into consideration by the assessing officer. Therefore, the assessing officer is not justified in making addition in the income of the assessee. The same is directed to be allowed.
Thus ground No. 1 of the assessee is allowed.
Disallowance of depreciation claimed on car purchased and delivery - put to use after duly provisionally registered with RTO and deposit of road tax - HELD THAT:- The assessing officer has ignored the explanation given by the assessee that the car was taken in possession on 28-3-2003 as per delivery note on record. The assessee has also provided the copy of the cover note of insurance dated 29-3-2003. The copy of the bill for fuel purchased and used to run the vehicle dated 29-3-2004 was also produced and is on record. In the circumstances and facts of the case, the asset is considered as put to use in the impugned year and the assessee is entitled to depreciation. The assessing officer is therefore, directed to allow the claim of depreciation.
Thus, ground No. 2 of the assessee is allowed.
Disallowance of deduction of interest paid - interest under the head "Income from other sources" - In view of the consistent decision of the Special Bench decision in the case of Dy. CIT v. Allied Construction [2006 (11) TMI 242 - ITAT DELHI-A], the interest income has rightly been treated as income from other sources and the interest paid cannot be allowed as deduction u/s 57(iii) of the Act. However, since whole of the income of the assessee has been to be exempt by us u/s 10BA of the Act, hereinbefore, therefore, no addition under this ground will remain.
Thus, ground No. 6 of the assessee is allowed.
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2008 (10) TMI 641
Issues involved: Confirmation of duty against the appellants, denial of modvat credit, period of limitation for issuing show cause notice, setting aside of penalty under Section 11AC.
The judgment by the Appellate Tribunal CESTAT AHMEDABAD involved two appeals filed by the appellant and one by Revenue, arising from a common impugned order by the Commissioner (Appeals). The duty amounts of &8377; 8,41,394/- and &8377; 38,84,590/- were confirmed against the appellants, denying the benefit of modvat credit based on the duty paid by the input supplier. The Tribunal referred to various decisions, including M/s Hero Cycles Ltd. case, to establish that the credit cannot be varied at the recipient's end due to the duty assessed at the input supplier's end. The Tribunal held that denial of credit to the appellant was not justified based on these precedents.
Furthermore, the Tribunal noted that the period involved in the appeal was April-02 to March-05, while the show cause notice was issued beyond the normal limitation period as per Rule 15 of Cenvat Credit Rules. Considering the bonafide interpretation of the dispute and absence of malafide intent by the assessee, the Tribunal found that the demand was barred by limitation. Citing previous cases like Punjab Electricity Board and Mahindra & Mahindra Ltd., the Tribunal held that setting aside duty under Section 11AC indicated the extended period was not applicable in the absence of malafide, thus ruling the demand as barred by limitation.
Consequently, the impugned order was set aside, and both appeals filed by the assessee were allowed with consequential relief. In the case of Revenue's appeal against the setting aside of penalty by the Commissioner (Appeals), since the appellant's appeals were allowed, Revenue's appeal was rejected by the Tribunal.
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2008 (10) TMI 640
The High Court of Bombay dismissed the appeals filed by the Commissioner of Central Excise against the Order of the Appellate Tribunal. The issue involved had been previously answered by the Supreme Court in favor of the assessee, stating that the duty determined by the supplier unit cannot be challenged by the recipient unit. The Appellate Tribunal also held a similar view, leading to the dismissal of the appeals.
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2008 (10) TMI 639
Whether once an appeal is admitted and is placed for hearing i.e. hearing on merits, it can be dismissed for default but cannot be decided on merits in absence of appellant (or his advocate)?
Whether an appellate Court had right to dismiss an appeal on merits if the appellant fails to appear?
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2008 (10) TMI 638
TDS u/s 194LA - compensation paid to the land owners which was arrived at based on negotiated settlements - Compulsory acquisition or not - acquisition of land initiated u/s 11 of the Land Acquisition Act, 1894 - land owners have executed sale deeds on the basis of negotiations in favour of the petitioner.
HELD THAT:- The sale deeds would constitute sale under the Transfer of Property Act and cannot be treated as a compulsory acquisition under the law for acquisition of immovable property. As already noticed, there was no divesting of the title of the land owners under Section 16 of the Land Acquisition Act, namely, passing of an award, and possession being taken thereunder or by possession being taken earlier under the urgency clause, namely Section 17. The mere issuance of notification under Section 4(1) does not have the effect of divesting of title of the land owner. Only if there were such divesting of the title of the land owner, and amounts were paid either as compensation or as enhanced compensation, could it be said that there is compulsory acquisition under the law for the time being in force. It may be true that when the notification under Section 4 was issued, the choice of action of the land owners became limited. Faced with the notification under Section 4 of the Land Acquisition Act, there are three courses of action, which can be contemplated. Land owner may prefer writ petition challenging the notification itself. Instead if he is so advised, he may decide to transfer his right to the Government. If neither of the two happens and the Government does not decide to withdraw from the notification, the proceedings may be continued under the Land Acquisition Act where it reaches the stage where an award is passed determining the compensation and unless possession is taken under the urgency clause earlier possession is taken and Government becomes the owner of the property.
The title passed to the petitioner only on the strength of the sale deeds executed by the land owners concerned. A perusal of the sale deeds also would appear to clearly support the contention of the petitioner that there was a voluntary transaction entered into by a willing owner to transfer after a number of negotiations, which consumed considerable time. Even if the choice were limited, the question posed before me being whether there was a compulsory acquisition under the law in force, the answer can only be that there was no compulsory acquisition even though it may be true that, but, for the execution of the sale deeds, it may have led to compulsory acquisition under the Land Acquisition Act.
Once a notification under Section 4 is effaced by way of withdrawal, the only way it can restart the acquisition proceedings, if so advised, is to issue a fresh notification. This means, in the facts of this case, that even though Government started out by issuing a notification under Section 4 of the Land Acquisition Act, it became unnecessary to proceed with the acquisition as the land owners had executed sale deeds in favour of the petitioner - There is no provision in the Land Acquisition Act which empowers or enables the execution of the sale deed as done in this case. There is no merit in the contention of the respondents that the sale deeds were executed in exercise of the incidental power. It may be true that the Land Acquisition Act does not prohibit a sale in favour of the Government or authority. In fact even after the notification is issued and till there is vesting of the title with the Government under Section 16 or under Section 17, there is no prohibition against a sale by a land owner. But the absence of a prohibition does not mean that the sale deed is executed in the exercise of incidental powers. There is no warrant or need to trace the right of the landowner to any such incidental power in the matter of an inter vivos transaction as a sale even after a notification under the Act or a declaration is not prohibited.
Thus, invoking Section 194LA of the Income Tax Act in respect of cases where sale deeds were executed in favour of the petitioner was totally without jurisdiction. Ext.P4 palpably has no legs to stand on - petition allowed.
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2008 (10) TMI 637
Issues involved:
The judgment involves the interpretation of provisions u/s 80HHC and 10-A of the Income-tax Act, 1961 regarding the eligibility of deduction for export turnover of a unit situated in the Export Promotion Zone (EPZ) while computing total income.
Summary:
Issue 1: Interpretation of Section 80HHC and 10-A regarding deduction for export turnover in EPZ:
The case involved a dispute over whether the export turnover of a unit in the EPZ should be considered for deduction u/s 80HHC. The Assessing Officer disallowed the claim, stating that income from the EPZ unit did not form part of total income u/s 10-A, hence not eligible for deduction. The tribunal held that the export turnover from the EPZ unit should be included for computing the deduction u/s 80HHC, as the provision did not exclude such turnover. The revenue contended that once income from the EPZ unit was excluded from total income, it couldn't be reintroduced for deduction purposes. However, the tribunal found no exclusion of Section 80HHC in the relevant provisions.
Issue 2: Application of Section 10A(4)(iii) and interpretation of deductions under Section 80HH, 80HHA, 80-I, and 80J:
The counsel for the assessee argued that Section 10A(4)(iii) introduced in 1981 excluded specific deductions but not Section 80HHC. The revenue argued that since Section 80HHC was introduced in 1983, it couldn't have been excluded in 1981. The tribunal noted that subsequent amendments included exclusions for other provisions but not for Section 80HHC. The counsel for the assessee relied on beneficial interpretations for the assessee, citing relevant case laws.
Conclusion:
The High Court held that the export turnover from the EPZ unit should not be excluded while computing the deduction u/s 80HHC. The deduction formula in Section 80HHC(3) did not refer to total income, and the export turnover was integral to the computation. The court emphasized the beneficial nature of Section 80HHC for encouraging exports and interpreted the provision accordingly. The question was answered in favor of the assessee and against the revenue.
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2008 (10) TMI 636
Issues involved:
The issues involved in this case include valuation of property for income tax assessment, application of PWD rates for valuation, and the authority of the assessing officer to determine undisclosed income.
Valuation of Property:
The assessee's business and residential premises were surveyed by the Department under Section 133-B of the Income Tax Act. The assessing authority noted discrepancies in the valuation reports provided by the assessee and the Department. The Department's valuation report valued the building at Rs. 15,03,200, while the assessee's report showed a cost of construction of Rs. 9,41,700. The assessing officer concluded that the balance amount of Rs. 5,50,700 was undisclosed income, leading to a tax liability of Rs. 1,95,280. The first appellate authority granted a deduction of Rs. 75,000 based on the variance in PWD rates and CPWD rates.
Application of PWD Rates:
The Tribunal remanded the matter to the assessing authority with a direction to apply the PWD rates prevailing in the State of Kerala for valuation. The Department raised questions challenging the Tribunal's decision, arguing that the direction to use only PWD rates was arbitrary and violated statutory provisions. However, the Tribunal relied on case laws emphasizing the importance of using state-specific PWD rates for valuation. The High Court upheld the Tribunal's decision, stating that only PWD rates should be considered for valuation within the state.
Authority of Assessing Officer:
The Department questioned the Tribunal's decision to direct the assessing officer to adopt state PWD rates for valuation, arguing that it was based on conjectures and surmises. However, the High Court supported the Tribunal's decision, citing the legal position that only PWD rates should be used for valuation. The High Court found no error in the Tribunal's orders and rejected the Income Tax Appeal filed by the Department.
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2008 (10) TMI 635
Issues Involved:
1. Delay and laches in challenging termination.
2. Entitlement to pension under the pension rules.
Detailed Analysis:
1. Delay and Laches in Challenging Termination:
The petitioner, who joined service as a Drill Helper in June 1967, was terminated in 1982 following a show-cause notice. He remained silent for nearly 18 years before making representations in 2000 to be reinstated. The Tamil Nadu Administrative Tribunal directed the first respondent to consider the representation, which was subsequently rejected due to the petitioner's prolonged absence and non-compliance with procedural requirements. The petitioner then sought service benefits through the Tamil Nadu Administrative Tribunal, which was later transferred to the Madras High Court. The Single Judge declared the termination illegal due to non-compliance with mandatory requirements of section 17(b) of the Tamil Nadu Civil Services (Discipline & Appeal) Rules. However, the Division Bench reversed this decision, noting that the petitioner had not completed 20 years of qualifying service as of 1982, thus not entitled to pension.
The Supreme Court identified a common modus operandi where claimants circumvent the bar of limitation by filing representations long after the cause of action, leading to courts directing consideration of such stale claims. The Court emphasized that representations relating to stale or barred matters should be rejected without examining merits and that directions to consider such representations should be issued with caution. The Court highlighted that the burden of proof lies on the petitioner to demonstrate the invalidity of the termination, especially when there is a significant delay in challenging it.
2. Entitlement to Pension under the Pension Rules:
The petitioner claimed entitlement to pension under Rule 43(2) of the Tamil Nadu Pension Rules, 1978, which he interpreted as granting pension for a minimum of 10 years of service. The Supreme Court clarified that Rule 43(2) pertains to the regulation of the amount of pension and not the entitlement. Entitlement to pension is governed by Chapter V of the Pension Rules, which enumerates specific classes of pensions such as superannuation, retiring, invalid, and compensation pensions. The Court noted that the petitioner did not fall under any of these categories and had not completed the required 20 years of service for retiring pension.
The Court further explained that Rule 43(2) does not reduce the minimum period of service required for retiring pension to 10 years. Instead, it regulates the amount of pension for those already entitled under Chapter V. The petitioner's vague allegation of termination without specifying the nature (dismissal, removal, etc.) and failure to produce relevant documents weakened his case. The Court concluded that the petitioner was not entitled to pension as he did not meet the necessary conditions under the pension rules.
Conclusion:
The Supreme Court dismissed the special leave petition, finding no merit in the petitioner's claims. The Court underscored the importance of addressing representations related to stale claims with caution and reiterated the specific conditions required for pension entitlement under the relevant rules.
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2008 (10) TMI 634
Issues involved: Challenge to orders by Customs, Excise and Service Tax Tribunal and Commissioner (Appeals) regarding penalty imposition and pre-deposit requirement.
Customs, Excise and Service Tax Tribunal Order: The petitioner was penalized with a fine of Rs. 20,000 in an Order-in-Original. The Commissioner (Appeals) directed the petitioner to make a pre-deposit of the entire amount, which was rejected in a modification application. The Tribunal considered the financial status of the petitioner, who claimed inability to deposit the amount due to retirement and pending proceedings under Conduct Rules. The Tribunal dismissed the appeal but offered to remand the case if the pre-deposit was made. The petitioner, through their advocate, expressed willingness to comply with the pre-deposit order.
Decision: The High Court quashed the orders of the Commissioner (Appeals) and the Tribunal, granting the petitioner an opportunity to comply with the pre-deposit order. If the petitioner makes the pre-deposit by a specified date, the appeal will be restored to the Commissioner (Appeals) for a decision on merits without influence from the Tribunal's observations. The Commissioner (Appeals) is directed to pass the order after granting a hearing to the petitioner. The petition is disposed of with the mentioned modification.
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2008 (10) TMI 633
The Appellate Tribunal CESTAT CHENNAI allowed the appeals of the appellants engaged in manufacturing coated and bonded abrasives, citing a precedent where a similar case was decided in favor of the assessee by a Coordinate Bench at Bangalore. The impugned demand of differential duty was set aside based on this precedent.
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2008 (10) TMI 632
Issues involved: Challenge to the judgment of a Division Bench of the Jammu and Kashmir High Court dismissing the appeal on the ground of reinstatement of the respondent.
Summary:
The Supreme Court, in a judgment delivered by Justices Pasayat, Arijit, and Sharma, granted leave to appeal against the decision of the Jammu and Kashmir High Court. The High Court had dismissed the appeal of the appellants, stating that the respondent had been reinstated in service as per the judgment of a single Judge, rendering the appeal infructuous. The appellant's counsel argued that the High Court's order had no legal basis, emphasizing that the implementation of the order did not deprive the appellants of their right to appeal and challenge its correctness.
The Court observed that the mere implementation of an order, even without interim relief in favor of the applicant, does not preclude the appeal from being heard on its merits. Citing precedents such as Nagar Mahapalika v. State of U.P. and Nagesh Datta Shetti v. State of Karnataka, the Court reiterated the importance of entertaining appeals regardless of the implementation of orders. Referring to the case of Union of India v. G.R. Prabhavalkar & Ors., the Court highlighted that compliance with High Court directions by the State Government does not render an appeal infructuous, as seen in the context of pending appeals.
Based on the legal principles and precedents discussed, the Supreme Court set aside the impugned order of the High Court, directing that the writ appeal be heard on merits without expressing any opinion on the matter. The appeal was allowed to this extent, with no costs imposed on either party.
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2008 (10) TMI 631
... ...
... ... ..... dismissed on the ground of delay as also on merits.
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2008 (10) TMI 630
Issues Involved:
1. Jurisdiction and authority of the Municipal Corporation to claim property tax.
2. Legislative competence of the State Legislature under Part IXA of the Constitution.
3. Interpretation of Section 9(3) of the Madhya Pradesh Krishi Upaj Mandi Adhiniyam, 1972.
Detailed Analysis:
Jurisdiction and Authority of the Municipal Corporation to Claim Property Tax:
The primary issue was whether the Municipal Corporation, Ratlam had the jurisdiction to levy property tax on the buildings and superstructure constructed in the Market Yard within its area. The respondent contended that the Municipal Corporation had no such right, and sought a refund of Rs. 70,000/- deposited pursuant to notice and auction proceedings initiated against them.
Legislative Competence of the State Legislature under Part IXA of the Constitution:
The question of legislative competence was raised concerning whether the State Legislature of Madhya Pradesh had the authority to enact provisions under Section 9(3) of the Adhiniyam, given the provisions contained in Part IXA of the Constitution. However, the appellant did not challenge the proviso to Section 9(3) on the grounds of legislative competence at any stage.
Interpretation of Section 9(3) of the Madhya Pradesh Krishi Upaj Mandi Adhiniyam, 1972:
Section 9(3) of the Adhiniyam provides that the premises used for market yard, sub-market yard, or for the purpose of the Board shall not be deemed to be included in the limits of the Municipal Corporation, Municipal Council, Notified Area, Gram Panchayat, or a Special Area Development Authority. The proviso to this section creates an exception, ensuring that properties used for these specific purposes are exempt from property tax levied by municipal authorities.
The court reiterated that the function of a proviso is to except something out of the enactment or to qualify something enacted therein, which would otherwise fall within the purview of the main enactment. It emphasized that a proviso cannot be used to import into the enacting part something which is not there.
Conclusion:
The Supreme Court concluded that since there was no challenge to the proviso of Section 9(3) regarding legislative competence, the High Court could not have dealt with that issue. The appeal was disposed of without any order as to costs, and the court noted that if a challenge to the legislative competence is made in the future, it would be considered in its proper perspective and in accordance with the law.
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2008 (10) TMI 629
Whether there is a valid arbitration agreement in terms of Section 7 of the Arbitration and Conciliation Act, 1996?
Whether the person before him with the request is a party to the arbitration agreement?
Whether there was no dispute subsisting which was capable of being arbitrated upon?
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2008 (10) TMI 628
Issues Involved:
1. Manipulation of the scrip of the appellant company.
2. Publishing false and misleading announcements.
3. Manipulation of accounts for the year 2004-05.
Summary:
1. Manipulation of the scrip of the appellant company:
The appellant was charged with manipulating the market in its own shares by generating large trading volumes to raise the price of the scrip. The Board alleged that a group connected with the appellant indulged in trades among themselves, raising the price from Rs. 4.25 to Rs. 43.85. However, the Tribunal found no evidence of a link between the appellant and the traders. The mere presence of members at the annual general meeting or shared addresses with an associate company was insufficient to establish a connection. The charge of manipulative trading in its own shares by the appellant company, therefore, fails.
2. Publishing false and misleading announcements:
The appellant was accused of making misleading announcements to boost its scrip price, violating regulations 4(2)(k) and 4(2)(r) of the FUTP Regulations. The announcements included launching "worldwide outbound package tour services" and entering the forex business. The Tribunal found that the announcements were based on genuine business plans and agreements, and substantial steps were taken to implement these proposals. The announcements were of a price-sensitive nature, which the appellant was obliged to disclose. Thus, there was no reason to hold that the announcements were made only to mislead and dupe investors.
3. Manipulation of accounts for the year 2004-05:
The appellant was charged with showing inflated profits to lure investors. The profit was attributed to trading in shares of three companies, which the Board alleged were fictitious transactions. The Tribunal noted that the appellant received sale proceeds of more than Rs. 10 crore, and the broker's statement denying the trades was unreliable. The appellant's request for cross-examination of the broker was denied, violating principles of natural justice. The Tribunal found no material evidence that the manipulation in the annual accounts was intended to lure investors. Given the lack of any definite evidence, this charge against the appellant also fails.
Conclusion:
The main charge of manipulative trading in its own shares by the appellant fails due to the absence of any link established by the respondent Board between any of the traders and the appellant company. The charges of making false and misleading announcements and manipulation in the annual accounts of 2004-05 to lure investors also do not succeed. The appeal is allowed, and the impugned order is set aside. No order as to costs.
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2008 (10) TMI 627
The Department filed a reference case petition seeking a direction to the Customs, Excise and Gold (Control) Appellate Tribunal regarding the mandatory nature of filing a declaration under Rule 57T of the Central Excise Rules, 1944. The High Court dismissed the petition as the questions of law had already been decided against the Department in previous judgments.
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2008 (10) TMI 626
Non disclosures - whether the petitioner having not disclosed the transaction in its return and having not explained the alleged purchases of high speed diesel from Indian Oil Corporation the order of the assessment officer as well as the revisional authority need no interference?
Held that:- In view of the observations of the revisional authority the assessing officer was required to have inquired into the nexus and was required to prove the petitioner's nexus with the alleged inter-State purchases before holding the petitioner guilty of alleged inter-State purchases of high speed diesel. The impugned order without any proof of nexus of the petitioner with the alleged purchases could not have been affirmed by the revisional authority. Thus considered view while passing the impugned order the revisional authority has totally ignored its earlier remand order. The assessing officer has also not decided the matter in accordance with the directions contained in the remand order passed by the revisional authority. Appeal allowed.
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2008 (10) TMI 625
Issues:
Challenge to revised assessment order due to improper service of notice.
Analysis:
The petitioner challenged a revised assessment order passed by the respondent for the year 2001-02 under the Tamil Nadu General Sales Tax Act. The petitioner contended that while the revisional authority was not in dispute, they were not served with notice as required by the rules. The petitioner relied on Rule 32(5) of the Tamil Nadu General Sales Tax Rules, 1959, which specifies methods of communication for orders, including service on the person concerned, registered post, or affixture at the last known place of business or residence if other methods are not feasible. Additionally, Rule 52(1) outlines modes of service for notices, including giving it to the dealer, manager, agent, or legal representative, sending it by registered post, or affixing it at the last known place of business or residence if other methods are impractical. The respondent admitted that the notice of revision was sent to the assessee by ordinary post, not by one of the prescribed methods. The court found that the notice sent by ordinary post did not comply with the rules, leading to the impugned revision order being set aside. The matter was remitted to the respondent for proper compliance with the rules in issuing orders.
In conclusion, the writ petition was disposed of with no costs, and the connected miscellaneous petition was closed. The judgment highlighted the importance of proper service of notices in compliance with the rules to ensure fairness and adherence to legal procedures in assessment proceedings under the Tamil Nadu General Sales Tax Act.
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2008 (10) TMI 624
Issues: Liability of directors for company's dues under Bihar Tax on Entry of Goods Act, 1993; Maintainability of writ petition challenging certificate proceedings.
Liability of Directors:
The judgment dealt with the issue of whether directors could be held personally liable for the dues of a company under the Bihar Tax on Entry of Goods into Local Areas for Consumption, Use or Sale therein Act, 1993. The company in question, M/s. Nalanda Electro Steel (P) Limited, had admitted certain liabilities under the Act but failed to discharge them. The Commercial Taxes Department sought to recover the dues by initiating proceedings against the directors in their individual capacities. The court held that a company is a separate legal entity from its directors and shareholders, and their liability is distinct. The judgment emphasized that for civil dues of a company, directors and shareholders cannot be held personally liable. The court noted that the requisition made against the directors was without jurisdiction, as it failed to mention the company and targeted the directors individually. Consequently, the court declared the certificate proceedings against the directors to be null and void, quashing them accordingly.
Maintainability of Writ Petition:
The judgment also addressed the issue of the maintainability of the writ petition challenging the certificate proceedings. The State and the Commercial Taxes Department argued that the petitioners should have availed of alternative remedies, such as challenging the proceedings by denying liability and filing appeals against consequential orders. However, the court rejected this argument, stating that if the action taken is wholly without jurisdiction, there is no need for the petitioners to exhaust alternative remedies. The court highlighted that a company incorporated under the Companies Act is an independent juristic entity, and if the proceedings against it are without jurisdiction, the petitioners need not suffer the consequences and can directly seek relief through a writ petition. The court, therefore, allowed the writ petition and quashed the certificate proceedings pending before the Certificate Officer in Patna.
In conclusion, the judgment clarified the legal position regarding the liability of directors for a company's dues and emphasized the importance of jurisdiction in initiating proceedings. It upheld the principle that directors and shareholders cannot be held personally liable for the civil dues of a company and declared the certificate proceedings against the directors to be null and void. The court also established that in cases where the action taken is without jurisdiction, petitioners can seek relief through a writ petition without exhausting alternative remedies.
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9911796707
