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Showing 141 to 160 of 1721 Records
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2024 (9) TMI 1583
Violation of the provision under Section 129 (3) of the Central Goods and Services Act, 2017 - time limitation - specific contention raised by the petitioner is on Annexure P/2, a circular issued under Section 68 of the C.G.S.T Act read with Rule 138 of the C.G.S.T Rules, 2017 - HELD THAT:- It is specifically directed, as per Paragraph No. 2 (g), that an order of detention in FORM GST MOV-06 and a notice in FORM GST MOV-07 has to be in accordance with sub-section (3) of Section 129 of the CGST Act. Here, despite the notice having been issued within time, the petitioner was granted the entire limitation period for filing a reply. The petitioner did file the reply on the last date, in which event the Authority ought to have passed an order on that date itself, after considering the reply. The Authority having delayed the matter, the mandate of Section 129 (3) is not followed.
The impugned order cannot be sustained - refund of the amounts paid is directed - petition allowed.
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2024 (9) TMI 1582
Seeking to quash deficiency memo - refund of GST paid by the petitioner concern has been rejected on the ground of limitation - petitioner is also seeking a direction to the respondents to process and release the GST refund of petitioner - HELD THAT:- In terms of Section 54 of CGST Act of 2017, the application for refund of tax was to be filed before the expiry of two years from the relevant date, i.e., the application was to be filed by or before 19.09.2020. A perusal of annexure IV to the writ petition, i.e., Form-GST-RFD-01 reveals that the petitioner concern filed the application for refund of tax on 08.09.2020, i.e., well before the expiry of two years from the relevant date.
It is very strange that in the deficiency memo dated 23.09.2020 the respondent No.2 did not take the ground of limitation or that the original application of petitioner concern dated 08.09.2020 was barred in terms of Section 54 of CGST Act of 2017, which leads to the conclusion that on 08.09.2020 the original application of petitioner concern for refund of GST was within time from the relevant date. However, the application dated 28.03.2020, which was filed on the asking of respondent No.2, was rejected by respondent No.2 only on the ground of limitation. Once the respondents had treated the original application dated 08.09.2020 as within time from the relevant date, then how the second application dated 28.09.2020, which was in continuation to the original application dated 08.09.2020 and was filed only on the advice of respondent No.2, became barred by limitation.
A perusal of the objections filed by the respondents reveals that the respondents have miserably failed to justify their action in rejecting the claim of petitioner concern. It seems the objections have been filed only for the sake of objections and was a mere formality; the same seem to be evasive in nature. In the objections the respondents have failed to aver anything about the first application filed by the petitioner concern on 08.09.2020 - A perusal of the objections reveals that the respondents instead of taking a particular stance to controvert the claim of petitioner concern tried to avoid the same by simply averring no comments, which leads to the conclusion that the respondents were avoiding to make a direct reply and the same is sufficient for this Court to draw an adverse inference. It seems that before filing the objections the respondents did not go through the case of petitioner concern thoroughly and have taken the matter very lightly.
The deficiency memo (Form-GST-RFD-03) issued by Assistant Commissioner, Goods and Services Tax quashed - petition allowed.
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2024 (9) TMI 1581
Challenge to order u/s 73(9) of the Uttar Pradesh Goods and Services Tax Act, 2017 - HELD THAT:- The factual matrix is such that the matter is squarely covered by a coordinate Bench judgment of this Court in Mahaveer Trading Company vs. Deputy Commissioner State Tax and another [2024 (3) TMI 334 - ALLAHABAD HIGH COURT] where it was held that 'It has been passed in gross violation of fundamental principles of natural justice. The self imposed bar of alternative remedy cannot be applied in such facts. If applied, it would be of no real use. In fact, it would be counter productive to the interest of justice. Here, it may be noted, the appeal authority does not have the authority to remand the proceedings.'
The impugned order dated April 27, 2024 is quashed and set-aside with a direction given to the officer concerned to grant the petitioner another opportunity of filing a fresh reply and thereafter fix a date of hearing and pass a reasoned order. The entire exercise should be completed within a period of two months from date.
Petition disposed off.
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2024 (9) TMI 1580
Cancellation of registration of petitioner - bar of time limitation - order has been passed without any application of mind - violation of principles of natural justice - HELD THAT:- In Surendra Bahadur Singh's case [2023 (8) TMI 1262 - ALLAHABAD HIGH COURT] the appeal was barred by time under Section 107 of the Act, however, the coordinate Bench took into consideration the original order and set aside the same being non-reasoned and allowed the petitioner therein to file reply to the show cause notice.
The order impugned herein is liable to be set aside. Accordingly, the order dated February 16, 2023 is quashed and set aside. The petitioner is directed to file its reply to the show cause notice within three weeks from date and the adjudicating authority is directed to proceed de novo and pass order after granting opportunity of hearing to the petitioner - Petition allowed.
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2024 (9) TMI 1579
Jurisdiction to issue SCN - excess of the power conferred upon respondent-authority regarding scrutiny of returns as provided under Section 61 of the JGST Act - HELD THAT:- This writ petition is disposed of by giving liberty to the petitioner to explain the reason which has been sought in the second show-cause, within two weeks and the authority concerned will consider the same in accordance with law and depending upon the conclusion, follow-up action be taken in view of the mandate of Section 61 of the JGST Act.
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2024 (9) TMI 1578
Seeking directions to the Respondents for permanent migration of the Petitioner’s Firm under the same Goods and Service Tax Number (GSTN) and accordingly activate login id with appropriate login credentials at common portal - contention of the petitioner is that due to the inability to login at the common portal and in the absence of the migration, the petitioner cannot file returns or pay taxes and discharge its GST liability from July 2017 onwards - HELD THAT:- In light of the judgment rendered by Hon’ble Allahabad High Court in M/s Metro Institutes of Medical Sciences Pvt. Ltd. [2017 (10) TMI 784 - ALLAHABAD HIGH COURT] the concerned respondent authority is directed to immediately allow the petitioner-Firm to login on the GST portal for completing the process of migration for uploading its returns and to deposit the due tax.
The present writ petitions are allowed.
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2024 (9) TMI 1577
Seeking quashing of the intimation to the petitioner blocking the input tax credit - forged invoices without supply of any goods and services - competent Officer has reason to believe that the claim for input tax credit is fraudulent claim - Rule 86A of the GST Rules, 2017 - HELD THAT:- This Court does not find that impugned notices/intimation are without jurisdiction or contrary to the law as provided under the GST Act or Rules made thereunder. Therefore, this Court find no ground to interfere with the impugned intimation and notices.
Hence this writ petition is hereby dismissed.
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2024 (9) TMI 1576
Cancellation of the petitioner's GSTN Registration - time limitation - appeal was not entertained in view of the statutory limitation period prescribed under GST Act, 2017 - HELD THAT:- The petitioner is a contractor doing contract works for the Government and its agencies and enrolled under the central Goods and Service Tax Act, 2017. The petitioner has been provided with GSTN Registration No. 33AAZPE3354N1Z7 The impugned order has been passed cancelling his registration under the GST Act due to non filing of the returns for a period of six months. The petitioner claims that though he had handed over the documents to his accountant, the accountant had not filed the returns in time. Since the petitioner was not aware of the impugned proceedings, he could not file the appeal within the statutory period. The respondent claims that the Statue prescribes specific limitation period of 90 days to file an appeal.
A similar issue has been dealt with by a Hon'ble Division Bench of Bombay High Court [2023 (2) TMI 759 - BOMBAY HIGH COURT], wherein it has been held that 'Since it is merely a matter of cancellation of registration, the question of limitation should not bother us since it cannot be said that any right has accrued to the State which would rather be adversely affected by cancellation.'
The Central Goods and Service Act was enacted in the year 2017 with an object of levy and collection of tax on intra state supply of goods or services or both by the Central Government. It is not the interest of the government to curtail the right of the entrepreneurs like the petitioner. The petitioner must be allowed to continue his business and to contribute to the State's revenue. In the absence of GST Registration number, a professional cannot raise a bill. If the petitioner is denied a GST registration number, it affects his chances of getting employment or executing works, which ultimately affects his livelihood embodied under Article 21 of the Constitution.
The petitioner in this case is a contractor doing contractual works for the Government and its agencies. Most of the small scale entrepreneurs like carpenters, electricians, fabricators etc. are almost uneducated and they are not accustomed with handling of e-mails and other advance technologies - the uneducated traders can also respond to these notices atleast to some extent. Otherwise, these notices will be an empty formality and will not serve any purpose, for which it has been issued.
The object of any Government is to promote the trade and not to curtail the same. The method adopted by the department as on today is like strangulating the neck of the small scale entrepreneurs. The cancellation of registration certainly, amounts to a capital punishment so for as the traders are concerned - the department of GST has to think of the consequences and relax the rules and also find the modalities of conveying the show cause notice by way of SMS and also in the regional languages. This court expects the department of GST to take appropriate action by amending the relevant provisions considering the consequences on traders.
These writ petitions are disposed of.
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2024 (9) TMI 1575
Scope of statutory alternative remedy - Special Leave Petition arises out of the order passed by the High Court [2024 (2) TMI 1437 - DELHI HIGH COURT] dismissing the writ petition filed by the petitioner questioning the imposition of surcharge and raising demand - HELD THAT:- During the pendency of the present proceedings, there is yet another demand notice dated 28.05.2024 raised for the AY 2023-2024, as per which surcharge computed at 37% and a demand has been raised. Revenue submits that this error is occurring as the Central Processing Centre (CPC) has not adopted the mechanism of deleting excess calculation as it is programmed to so calculate and raise a demand.
The technological impediment cannot be a reason for harassing an assessee year after year. Immediate steps must be taken by the Revenue to upgrade the software or take such other steps as may be necessary to ensure that such mistake does not occur in future.
Insofar as the order impugned is concerned, the dispute has already been resolved and the amount is said to have been remitted on 06.06.2024. However, for the Assessment Year 2023-2024, the Revenue shall take immediate steps and communicate the order of withdrawal of the excess surcharge amount within six weeks from the date of the receipt of the order. The Central Board for Direct Taxes shall also take necessary steps for rectifying the software as the issue may not be resolved by the Jurisdictional Assessing Officer. Special Leave Petition is disposed of.
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2024 (9) TMI 1574
Settlement applications u/s 245C (1) - statutory requirement of “full and true disclosure” u/s 245C of the Income Tax Act, 1961, pre-conditions associated with an application under Chapter XIX-A of the Act and effect of violation of the said pre-conditions on the jurisdiction of the Income Tax Settlement Commission [“ITSC”] as well as the fate of the application - As decided by HC [2024 (4) TMI 501 - DELHI HIGH COURT] ITSC has erred in law by approving the application of the respondent-assessee group u/s 245C - ITSC further went on to grant immunity from the penalty and prosecution u/s 245H of the Act, which was contrary to the twin conditions stipulated herein above. Thus, the ITSC acted in excess of the jurisdiction conferred upon it under the Act. WP allowed.
HELD THAT:- Delay condoned. We are not inclined to interfere with the impugned judgment and, hence, the special leave petition is dismissed
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2024 (9) TMI 1573
Proceedings for reassessment initiated after the decision of the Supreme Court in Abhisar Buildwell Private Limited [2023 (4) TMI 1056 - SUPREME COURT] - Determination of period of limitation - writ petitioners assail the validity of the reassessment action principally on the ground of being barred by time -It is their case that the reassessment action which had come to be initiated after the promulgation of Finance Act, 2021 would not qualify the pre-conditions which are introduced by virtue of the First Proviso to Section 149 (1) - HELD THAT:- Today there cannot possibly be any dispute or contestation on the discovery of incriminating material constituting the foundation for any assessment that may be made under Sections 153A or 153C of the Act. Any dispute that could have possibly be said to exist was ultimately laid to rest by the Supreme Court in Abhisar Buildwell. The only aspect which thus survives for consideration is whether the observations as appearing in Abhisar Buildwell could be read as enabling the respondents to overcome the limitation which stands created in terms of Section 149 of the Act.
It is pertinent to note that a reference to Sections 147 and 148 of the Act in Abhisar Buildwell firstly appears where the Supreme Court observed that in cases where a search does not result in any incriminating material being found, the only remedy that would be available to the Revenue would be to resort to reassessment.
The liberty which the Supreme Court accorded and the limited right inhering in the Revenue to initiate reassessment was subject to that power being otherwise compliant with the Chapter pertaining to reassessment as contained in the Act. The observations of the Supreme Court cannot possibly be read or construed as a carte blanche enabling the respondents to overcome and override the restrictions that otherwise appear in Section 149 of the Act. The observations of the Supreme Court in Abhisar Buildwell were thus intended to merely convey that the annulment of the search assessments would not deprive or denude the Revenue of its power to reassess and which independently existed. However, the Supreme Court being mindful of the statutory prescriptions, which otherwise imbue the commencement of reassessment, qualified that observation by providing that such an action would have to be in accordance with law. This note of caution appears at more than one place in that judgment and is apparent from the Supreme Court observing that the power to reassess would be subject to the fulfilment of the conditions mentioned in Sections 147 and 148 of the Act.
We also bear in mind the order passed on the Miscellaneous Application which was moved by the Revenue before the Supreme Court and more particularly to the prayers that were made therein. The Revenue had specifically alluded to Section 150 of the Act and sought appropriate clarifications enabling it to proceed afresh. It had also sought the liberty to commence proceedings for reassessment within 60 days of the disposal of that application. The said application, however, came to be dismissed with it being left open to the respondents to move a formal application for review, if so chosen and advised. It appears, however, that no such review was ultimately moved.
Undisputedly, none of the clauses of Explanation 1 would be attracted in the facts and circumstances of the present batch. The statute incorporates no provisions in terms of which the period which may have been consumed while pursuing an assessment under Sections 153A or 153C is liable to be excluded if such an action were to be ultimately annulled. The fact that the statute seeks to create rigid time frames within which a reassessment action may be initiated stands fortified by the First Proviso appearing in Section 149, and which came to be introduced in the statute book by Finance Act 2021.
It is pertinent to note that both Sections 153A and 153C saw significant amendments which came to be made by virtue of Finance Act, 2021. Both those provisions saw the introduction of a sunset clause and the statute mandating that the scheme of search assessment as introduced in the Act originally by way of Finance Act, 2003 would cease to apply to a search initiated on or after 01 April 2021.
Notwithstanding the curtains thus being wrung down on Sections 153A and 153C, the Proviso to Section 149 (1) in unambiguous terms provides that in case reassessment is sought to be initiated for a relevant AY falling prior to 01 April 2021, such an action would have to be in conformity with the time limits specified in Sections 149 (1) (b), Sections 153A or 153C, whichever be applicable, and as those provisions stood immediately before the commencement of Finance Act, 2021. The Proviso is thus representative of a clear legislative policy of reassessments being required to be compliant with time frames which existed in the provisions aforenoted and as they stood before the commencement of Finance Act, 2021.
The respondents despite the clear enunciation of the legal position with respect to search assessments in terms of our judgements in Kabul Chawla, RRJ Securities and a host of others that followed neither chose to initiate any remedial action nor did they adopt a course correction. Nothing fettered the right of the respondents to commence reassessment if they were of the opinion that, notwithstanding absence of incriminating material, escapement of income had occurred. It was open for the respondents to establish that an action for reassessment was warranted independently and irrespective of no adverse material having been found in the course of a search. We thus find ourselves unable to hold in their favour. Consequently, and for all the aforesaid reasons, we find ourselves unable to sustain the reassessment action.
The writ petitions are accordingly allowed. We hereby quash the impugned notices under Section 148 - Decided in favour of assessee.
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2024 (9) TMI 1572
Validity of reassessment proceedings - “change of opinion” - addition u/s 56 - Assessee had acquired and subscribed the equity shares of a closely held company at below fair market value under the ‘Right Issue’ - PCIT had dropped the proceedings u/s 263 after considering the petitioner's submissions - HELD THAT:- The use of words “reasons to believe” in Section 147 has to be interpreted schematically as any other interpretation would lead to the consequence of conferring arbitrary powers on the AO, who may even initiate such reassessment proceedings merely on a change of opinion on the basis of same facts and circumstances already considered during the original assessment proceedings. The provision for reassessment was brought into the statute book to empower the AO to reassess any income only on the ground which was not brought on record during the original proceedings and escaped its knowledge.
Admittedly, after considering the reply of the assessee, PCIT had dropped the proceedings initiated u/s 263 of the Act. Thus, it is evident that at the time of initial assessment, as also while conducting proceedings under Section 263, the authorities were aware of shares held by the assessee for a consideration which was considered to be less than fair market value. However, Revenue still proceeded further to purpose initiation of reassessment proceedings by issuing notice under Section 148A(b).
It is clear that the reasons for issuing notice under Section 148A (b) were exactly similar to the reasons on which the PCIT invoked Section 263 of the Act. Once the PCIT decided in favour of the petitioner after having considered its reply, AO had no authority to reassess and reopen the assessment under Section 148 of the IT Act. It is a clear case of “change of opinion” and the reassessment proceedings are in the nature of review of the previous assessment. Grant of approval by the senior authority i.e. PCCIT would not confer legitimacy to the initiation of the reassessment action as the point on which the reassessment was initiated, had already been considered in the previous proceedings. The higher authority cannot grant approval which is in violation of the settled principles on the basis of which reassessment action can be initiated.
We are unable to sustain the impugned action for reassessment. The writ petition is accordingly allowed. The impugned notice u/s 148A (b), order passed under Section 148A (d) and notice under Section 148 as also the consequential proceedings emanating there under are set aside.
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2024 (9) TMI 1571
Disallowance u/s 14A r.w.r.8D - explanation inserted to Section 14A by Finance Act, 2022 applied Retrospectively or prospectively - HELD THAT:- In view of the Memorandum Explaining the Provisions in the Finance Bill, 2022 and various decisions rendered by the different High Courts, we also hold that the Explanation inserted to Section 14A vide Finance Act, 2022 is applicable prospectively.
Thus, the order passed by the Tribunal dated 06.07.2022, holding that insertion of Explanation to Section 14A of the Income Tax Act, 1961 is clarificatory and thereby retrospective in nature, is erroneous in law. The findings of the Tribunal to the effect that the insertion of Explanation to Section 14A is clarificatory, is contrary to the legislative intention as expressed in Memorandum to the Finance Bill, 2022.
We have also taken note of the fact that the Bench of the Tribunal, in earlier decision rendered in Deputy Commissioner of Income Tax, Circle - 4 (1) , Kolkata Versus M/s. Rav Dravya Private Limited [2022 (11) TMI 842 - ITAT KOLKATA] while relying on decision of Delhi High Court in “Pr.CIT Vs. Era Infrastructure (India) Ltd. [2022 (7) TMI 1093 - DELHI HIGH COURT] has held that the Explanation inserted to Section 14A is applicable prospectively. However, the same Bench, while deciding the Miscellaneous Applications, preferred on behalf of the appellants subsequently has concluded that the decision of the Delhi High Court is not binding the Tribunal.
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2024 (9) TMI 1570
Maintainability of appeal against High Court - Appropriate remedy for the petitioner is to avail of a statutory appeal - order u/s 201 (1) raising a demand and interest u/s 201 (1A) - TDS u/s 195 non deducted on acquisition/purchase of a Trade Mark registered in India by the petitioner from the foreign/non-resident group entities
Whether the petitioner has made out any case of patent illegality of the impugned order and / or of any gross jurisdictional error going to the root of the proceedings, so that an exception needs to be carved out, to deviate from the well settled principle of law, that once a statutory remedy as prescribed by law is available, a litigant needs to take recourse to such statutory remedy? - HELD THAT:- We are of the opinion that necessarily mixed issues of fact and law arise for consideration in the present proceedings in testing the impugned order on its merits, which would include applicability of the principles of territoriality as recognized by Toyota Jidosha Kabushiki Kaisha [2017 (12) TMI 1886 - SUPREME COURT] - Also the petitioner’s contention relying on the decision in Cub Pty Limited [2016 (7) TMI 1094 - DELHI HIGH COURT] when it recognizes principles of situs of the Trade Mark being of the ownership of the foreign entity, whether would apply in the facts of the present case, and more particularly on examining the different clauses / terms and conditions of the agreement, so as to be considered that the situs fell outside India, are issues which can be effectively gone into by the Appellate Authority, for appropriate findings of fact to be recorded and thereafter the issue being tested on the principles of law as laid down in the different decisions being relied on behalf of the parties.
We may also observe that this is certainly not a case where the Assessing Officer has conferred upon himself a jurisdiction which is not vested in him in law, in passing the impugned order, so that the Court needs to hold that the authority lacked jurisdiction to pass the impugned order. Certainly, if the Assessing Officer was to exercise jurisdiction not vested in him or in a patently illegal manner or ex facie contrary to the substantive provisions of the Income Tax Act, then certainly following the well settled principles of law as laid down in catena of judgments of the Supreme Court, the Court would unhesitatingly interfere in writ proceedings. However, the petitioner’s contention that the Deputy Commissioner in view of the decision of the Delhi High Court in CUB Pty Ltd. [2016 (7) TMI 1094 - DELHI HIGH COURT] ought to have held that the transaction in question fell outside the purview of the Income Tax Act, as the seller of the trade mark was a foreign entity, is certainly a debatable issue on applicability of the legal principles vis-a-vis the substantive provisions of the Act. This cannot be said to be an issue determining the substantive jurisdiction of the Dy. Commissioner as conferred under the provisions of the Act to initiate an action under Section 201.
It would be a question, merely as to whether the principles of law in a given decision, were applicable in the facts and circumstances of the case, and more particularly when it is vehemently contested on behalf of the Revenue that such decision of the Delhi High Court is not applicable to the facts in hand. In our opinion, these are routine issues which arise before the authorities under the Income Tax Act as also the Income Tax Appellate Tribunal or in any adjudicatory process before the Court. However, the applicability or non applicability of any decision, in our opinion, certainly does not present a core jurisdictional issue when tested on the powers conferred on the authority under the substantive provisions of the Act.
Considering the facts of the case, once a substantive statutory remedy is provided and available to the petitioner, it would not be appropriate that the Court exercises its extraordinary jurisdiction under Article 226 of the Constitution and entertain this writ petition. If the proposition as canvassed by Mr. Mistri is to be applied, then the appellate remedy as provided under the Act would remain to be a paper provision and every order passed by the Assessing Officer, on the considerations as canvassed before us, would be amenable to challenge in writ proceedings. In our opinion, this is certainly not an acceptable proposition.
As decided in Kharghar Co-op. Housing Societies Federation Ltd., through General Secretary & Anr. vs. Municipal Commissioner, Panvel Municipal Corporation & Ors [2023 (4) TMI 1241 - BOMBAY HIGH COURT] Court had held that it may not be appropriate for the Writ Court to short circuit or circumvent statutory procedures and it is only where statutory remedies are entirely ill-suited to meet the demands of extraordinary situations or where private or public wrongs are so inextricably mixed up and the prevention of public injury and the vindication of public justice require a recourse to Article 226 of the Constitution be permitted.
Insofar as the issue of limitation is concerned, it appears to be an admitted position that Section 201 ipso facto has not provided for any limitation of one year. We may also refer to the decision of the Division Bench of the Telangana High Court, which considered the decision of this Court in Mahindra & Mahindra Limited [2014 (7) TMI 265 - BOMBAY HIGH COURT] as also the decision of Bharti Airtel Limited Vs. Union of India [2016 (12) TMI 1601 - DELHI HIGH COURT] wherein the Division Bench held that the legislature has consciously not prescribed any time limit for an order under Section 201 (1) of the Act insofar as non-resident is concerned; the reason being that deductee is a non-resident, it may not be administratively possible to recover the tax from the non-resident.
We are not persuaded to accept the case of the petitioner that the present writ petition be made an exception and the same be entertained, by not relegating the petitioner to avail of alternate remedy of an appeal, as provided under the Act. We accordingly dismiss this petition permitting the petitioner to avail of the statutory remedy of an appeal. All contentions of the parties on all issues of facts and law are expressly kept open.
We permit the petitioner to file an appeal within 15 days from the receipt of the fresh order along with stay application including to make appropriate prayers in regard to penalty proceedings. Till appropriate orders are passed on the stay application, the demand be not enforced against the petitioner.
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2024 (9) TMI 1569
Sustainability of order passed against a dead person - Legal heirs' liability to discharge deceased assessee's liabilities - HELD THAT:- There is no dispute about the aforesaid provision of law but under the principle of natural justice, legal heirs of the deceased assessee are liable to be heard if they are to discharging the liability of the assessee.
There is no document to show that notices were tired to be served on the appellant and returned back unserved with a noting that the assessee is no more, therefore, no efforts were made to implead the legal heirs of the assessee.
As decided in Savita Kapila [2020 (7) TMI 441 - DELHI HIGH COURT] noted that a notice u/s 148 of the Act is a jurisdictional notice, and existence of a valid notice u/s 148 is a condition precedent for exercise of jurisdiction by the AO to assess or reassess u/s 147 of the Act. The want of valid notice affects the jurisdiction of the AO to proceed with the assessment and thus, affects the validity of the proceedings for assessment or reassessment. A notice issued under Section 148 of the Act against a dead person is invalid, unless the legal representative submits to the jurisdiction of the Assessing Officer without raising any objection." Consequently, in view of the above, a reopening notice under Section 148 of the Act, 1961 issued in the name of a deceased assessee is null and void.
The impugned order is set-aside and the matter is remanded back to respondent No.1 with direction to decide the appeal afresh. The petitioner shall appear before the respondent No.1-National Faceless Appeal Centre (NFAC).
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2024 (9) TMI 1568
Right of the Income tax authorities to seek interim custody of currency notes seized and produced before the Jurisdictional Magistrate or seized and reported to the Jurisdictional Magistrate in terms of Section 102 of the Code of Criminal Procedure (the Code) - Powers to requisition books of account, etc. u/s 132A -
HELD THAT:- When the Act confers power on the competent authority under the Act to issue a requisition and obtain assets of assessees and adjust the same towards their liabilities, if the competent authority has reason to believe that the asset represents either wholly or partly income or property which has not been or would not be disclosed for the purposes of the Act, according to us, the best suited person to hold the currency notes which have been seized in cases of this nature until the culmination of the enquiry or trial, would be the competent authority under the Act provided it is alleged that the asset represents either wholly or partly income or property which has not been or would not be disclosed for the purposes of the Act. Even though this Court held in Abdul Khader [1998 (11) TMI 76 - KERALA HIGH COURT] that Section 132A does not empower the competent authority to make a requisition to a court for delivery of assets, it was made clear in the said case that the competent authority under the Act is entitled to seek interim custody of the seized assets. In the said view of the matter, according to us, the view expressed in Union of India that the competent authority under the Act is entitled to seek interim custody of the currency notes in the facts of the said case, is in order.
A close reading of the judgment in J.R. Malhotra [1975 (12) TMI 170 - SUPREME COURT] would indicate that the case dealt with therein relates to a seizure effected prior to the introduction of Sections 132A and 132B of the Act. What the learned Judge omitted to take note of, is the power conferred on the competent authorities to hold any assets if it has reason to believe that the same represents either wholly or partly income or property which has not been, or would not be disclosed for the purposes of the Act. Of course, the said power is subject to the exception provided for in the first proviso to clause (i) of sub-section (1) of Section 132B.
If the competent authority has reason to believe that the amount seized represents wholly or partly income or property which has not been or would not be disclosed for the purposes of the Act and is unable to issue a requisition in terms of Section 132A of the Act for the reason that asset has been produced by the officer or authority who seized the same before the Jurisdictional Magistrate, as clarified by this Court in Abdul Khader, the competent authority shall be held to be authorised to prefer an application seeking interim custody of the currency notes under Section 451 of the Code, for otherwise, Sections 132A and 132B, would become futile. Needless to say, the view expressed in R. Ravirajan that the provisions contained in Sections 132A and 132B are not relevant in the context, does not appear to us to be correct.
As we propose to uphold the view expressed in Union of India, it is necessary to clarify that the direction in Union of India that the competent authority under the Act, on receipt of the seized currency notes, shall complete the proceedings contemplated against the person concerned within a period of six months and if not, the amount shall be redeposited and shall be released to the person from whom the amount has been seized, is not in accordance with law. Such a direction is unwarranted inasmuch as the scope of the proceedings is only to decide the person who is best suited to have custody of the currency notes until the conclusion of enquiry or trial. According to us, direction for disbursement/ appropriation of the amounts after completing the proceedings contemplated under the Act can be issued only when the court exercises the power u/s 452 of the Code for disposal of the property at the conclusion of the enquiry or trial.
The reference is answered upholding the view taken in Union of India.
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2024 (9) TMI 1567
Revision u/s 263 - CIT observed that the assessee has declared Guarantee income as “other income”, however, the assessee claimed such income as notional income and reduced the same from total income.
HELD THAT:- It is pertinent to note that the aspect of Guarantee income as mentioned in note 28 has been enquired by the AO during the assessment proceedings and after taking the cognizance of the same, the same was allowed by the AO. The Observation of the PCIT that the same was not examined properly is not justifiable on the part of the PCIT. The Notional Guarantee Income charged from joint venture of the investment and hence investment cost has been increased by the said amount cannot be treated as actual income incurred by the assessee.
PCIT while invoking the provision of section 263 of the Act has totally ignored the aspect that the AO has verify the same and in fact Notional Guarantee Income has not resulted into any loss of the Revenue as contemplated by Ld.PCIT in para 7.1 of the order passed u/s. 263 of the Act. Thus, in the present case the Assessing Officer has not passed the assessment order which will result into prejudicial to the interest of the Revenue or erroneous to the interest of Revenue. Appeal filed by the assessee is allowed.
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2024 (9) TMI 1566
Revision u/s 263 - as per CIT allowing the claim of exemption u/s 54F was erroneous and prejudicial to the interest of the Revenue - HELD THAT:- It is pertinent to note that the ownership of the land is that of assessee’s spouse and her brother-in-law and in fact the assessee has given these details for claiming u/s. 54F of the Act. The assessee has given all the details relating to the construction as well as the purchase of residential house within the prescribed period of 3 years.
The contention of the Ld.DR that the land belonging to her spouse and her brother-in-law will not debarred the claim u/s. 54F of the Act as projected by the Ld.PCIT. But besides this the AO has made detailed inquiries at the time of the assessment proceedings and therefore section 263 cannot be invoked for merely the change in opinion/difference of opinion of the Ld.PCIT.
AO at the time of the assessment proceedings has taken cognizance of all the details filed by the assessee and therefore the invocation of section 263 itself is not justifiable. Hence, the appeal of the assessee is allowed.
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2024 (9) TMI 1565
Denial of foreign tax credit pertaining to the foreign sourced salary income which is doubly taxed, i.e., in USA as well as India - belated furnishing of Form no.67 - HELD THAT:- We find that the Benches of the Tribunal on pan India basis had delved into the matter and had granted relief to the assessee. The learned Departmental Representative, though relied upon the order of the authorities below, but failed to distinguish any of the above judgments.
DR also failed to adduce any cogent material or any arguments to take a view other than the view taken in AKSHAY RANGROJI UMALE [2024 (2) TMI 159 - ITAT PUNE] Consequently, relying upon the crudité pronouncements of the Co–ordinate Bench of the Tribunal, we hold that the assessee is entitled to foreign tax credit irrespective of belated furnishing of Form no.67. Accordingly, all the grounds raised by the assessee are allowed.
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2024 (9) TMI 1564
Penalty imposed u/s 271D r.w.s. 269SS - period of limitation - whether penalty orders were time-barred? - HELD THAT:- In the present case, admittedly, the recommendation has been made by the A.O. for initiation of penalty was on 08/12/2017. As per the first condition of Section 275(1)(c) i.e. expiry of the Financial Year in which the proceedings, in the course of which action for imposition of penalty has been initiated and completed on 31/03/2018. As per second condition of Section 275(1)(c) i.e. six months from the end of month in which action for imposition of penalty has been initiated will be expired on 30/06/2018.
Additional CIT(A) has initiated penalty on 07/07/2018 whereas the same has been referred to him on 08/12/2017 itself, thus, in our considered opinion, the same is barred by limitation as per provision of Section 275(1)(c) of the Act. Thus, we have no hesitation to delete the orders of penalty - Decided against revenue.
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