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Showing 21 to 40 of 1569 Records
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2021 (9) TMI 1551
Dishonour of Cheque - rejection of examination-in-chief of accused submitted by way of affidavit under Section 145 of the Negotiable Instruments Act, at the stage of defence evidence - HELD THAT:- In the case of RAJNI DHINGRA VERSUS SANJEEV CHUGH [2019 (11) TMI 1830 - PUNJAB AND HARYANA HIGH COURT], the issue involved in the matter has been dealt with and after taking note of INDIAN BANK ASSOCIATION AND OTHERS VERSUS UNION OF INDIA AND OTHERS [2014 (5) TMI 750 - SUPREME COURT] and also MANDVI CO-OP. BANK LTD. VERSUS NIMESH B. THAKORE [2010 (1) TMI 570 - SUPREME COURT] held that the petitioner being an accused, who is facing trial in complaint under the provisions of Negotiable Instrument Act, is not competent to tender his evidence through affidavit and learned trial Court has not committed any error while declining permission to this effect to the petitioner.
The Apex court in case of Indian Bank Association was dealing with the issue of laying down appropriate guidelines/directions to be followed by the Courts while trying complaints under Section 138 of the Negotiable Instruments Act and the issue before the Apex Court was to ensure expeditious disposal of such cases. Though, reference to observations of the Apex court in case of Mandvi Cooperative Bank Ltd. was made but as already discussed the law settled by the Apex Court in that cases is clear and has not been set-aside or dissented so far. Even that was not in issue before the Apex Court in case of Indian Bank Association.
The petitioners being accused who are facing trial in complaint under the provisions of Negotiable Instruments Act, are not competent to tender their evidence through affidavit and learned trial court has not committed any error while declining permission to this effect to the petitioners being accused.
Petition dismissed.
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2021 (9) TMI 1550
Exclusive possession of property - possession of the chobaras on the first floor of the three shops - mandatory injunction to close the holes in the lintel of the shop in occupation of Avtar Singh - ignoring material evidence and misreading of evidence or not - Section 100 Code of Civil Procedure - HELD THAT:- Undeniably Avtar Singh's possession-and perhaps even ownership-of the ground floor shop, could not be denied. The findings of the lower courts, therefore, based upon the registered documents cannot be faulted. However, both these courts ignored the other evidence-in the form of the Local Commissioner's report-with regard to the issue of possession of the chaubara. The Local Commissioner was neither cross-examined, nor was his report objected to.
The question that arises, is whether the High Court justly interfered with what are unquestionably, concurrent findings of fact. This Court in its five-judge bench ruling, in PANKAJAKSHI VERSUS CHANDRIKA [2016 (2) TMI 1063 - SUPREME COURT] held that the provisions of Section 41 of the Punjab Courts Act, 1918 continued to be in force, and not Section 100 Code of Civil Procedure - the previous smaller bench ruling in KULWANT KAUR & ORS. VERSUS GURDIAL SINGH MANN (DEAD) BY LRS & ORS. [2001 (3) TMI 1044 - SUPREME COURT] which held that Section 41 is inconsistent with Section 100 Code of Civil Procedure after its amendment in 1976, and that the latter prevails, was expressly overruled.
It is thus evident, therefore, that mere findings of fact cannot be interfered with in exercise of second appellate jurisdiction given the three limbs of jurisdiction available Under Section 41 of the Punjab Courts Act. Findings of fact which are unreasonable, or which are rendered by overlooking the record, therefore, per se do not appear to fall within the scope of second appellate review by the High Court. In these circumstances, the High Court's findings - which are based entirely on the reappreciation of the record - and consequent interference with the concurrent findings of the lower courts, cannot be upheld.
The impugned judgment has to be set aside - Appeal allowed.
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2021 (9) TMI 1549
Multiple FIRs for the same incident - multiple FIR registered with respect to a incident of fire that was stoked in single dwelling - HELD THAT:- All the FIR’s state that the incident took place a single date i.e. 24.2.2020. All the FIR’s state that monetary loss was caused to each of the complainants residing in parts of the buildings in the same compound and in the immediate neighborhood as their belongings and other valuables had been burnt down. Lalit Kumar, the complainant in FIR No.113/2020, has stated that the premises was his ancestral property and had been divided into four portions pursuant to a family arrangement.
The FIR’s state that the arson was extinguished by the same Fire Brigade bearing unique number- 926225. Furthermore the charge-sheet containing the site plan shows that all the properties are part of the same premises or they are in very close proximity with one another.
A careful perusal of the site map of the incident, reproduced hereinabove, shows that on 24.02.2020, a mob entered the compound where the properties are situated, ransacked it and set it ablaze. It may be so that the properties are different or distinct from one another but are located in one compound. It is also to be noted that most of the houses in the said compound belong to the same family and were owned by different members of the family after being divided by their forefathers.
In T.T. ANTONY VERSUS STATE OF KERALA AND ORS. [2001 (7) TMI 1322 - SUPREME COURT], the Supreme Court has held 'a case of fresh investigation based on the second or successive FIRs, not being a counter case, filed in connection with the same or connected cognizable offence alleged to have been committed in the course of the same transaction and in respect of which pursuant to the first FIR either investigation is underway or final report under Section 173(2) has been forwarded to the Magistrate, may be a fit case for exercise of power under Section 482 Cr.P.C. or under Article 226/227 of the Constitution.'
The law on the subject has been settled keeping in line with the principles enunciated by the Supreme Court of India. There can be no second FIR and no fresh investigation in respect of the same cognizable offence or same occurrence giving rise to one or more cognizable offences.
In the present case, it cannot be said that the incidents were separate or the offences are different. As stated earlier, a perusal of the charge-sheets filed in the respective FIRs show that they are more or less identical and the accused are also same. However, if there is any material that has been found against the accused the same can be placed on record in FIR No.106/2020.
Save FIR No. 106/2020 registered on 01.03.2020 at Police Station Jaffrabad, FIR No. 107/2020, FIR No.112/2020, FIR No. 113/2020 and FIR No.132/2020 all registered at Police Station Jaffrabad and all proceedings emanating therefrom are hereby quashed and set aside - Petition disposed off.
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2021 (9) TMI 1548
Disputed measurements and extra work claims - Rejection of Joint Survey Report - Division Bench of the High Court held that resurvey for measurement and DPR would not be just and fair at this stage since five monsoons had passed - approval of Detailed Project Report (DPR) and payment of pending bills - HELD THAT:- The High Court has based its order on the ground that after five monsoons, the final measurements could not be ascertained. If the final measurements could not be done at the spot, the contemporary evidence and the measurement books prepared from time to time could be the basis for determining the liability of the appellants. The Joint Survey Report is not an admitted measurement, though some officers might have signed it. The Report prepared after the completion of work wherein no such work done is reflected in the measurement book prepared during execution of work is an attempt to inflate the claim raised by the writ petitioner. The entire amount claimed by the writ petitioner is disputed.
The dispute could not be raised by way of a writ petition on the disputed questions of fact. Though, the jurisdiction of the High Court is wide but in respect of pure contractual matters in the field of private law, having no statutory flavour, are better adjudicated upon by the forum agreed to by the parties. The dispute as to whether the amount is payable or not and/or how much amount is payable are disputed questions of facts. There is no admission on the part of the appellants to infer that the amount stands crystallized. Therefore, in the absence of any acceptance of Joint Survey Report by the competent authority, no right would accrue to the writ petitioner only because measurements cannot be undertaken after passage of time. Maybe, the resurvey cannot take place but the measurement books of the work executed from time to time would form a reasonable basis for assessing the amount due and payable to the writ petitioner, but such process could be undertaken only by the agreed forum i.e., arbitration and not by the Writ Court as it does not have the expertise in respect of measurements or construction of roads.
A perusal of the matter shows that collusion of some of the officers of the appellants with the contractor cannot be ruled out. Such collusion seems to be the basis of the writ petition filed before the High Court.
It is deemed appropriate to allow the present appeal while dismissing the writ petition filed by the writ petitioner before the High Court.
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2021 (9) TMI 1547
Provisional release of the seized goods on execution of Bond and on furnishing of bank guarantee - non-speaking order - Import goods for home consumption - Section 110 A of the Customs Act, 1962 - HELD THAT:- Since the order communicated to the Appellant is similar to the communication dated April 24, 2020 that was received in the Appeal filed by Rudra Overseas 2020 (10) TMI 70 - CESTAT NEW DELHI , it would be proper if a similar order is passed in this case.
In the present case also the goods are stated to be for home consumption and liable to deterioration. The Commissioner shall, therefore, pass an order for provisional release of the goods in the light of the aforesaid observations.
At this stage, the learned Counsel for the Appellant has stated that steps are being taken by the Department for disposal of the seized goods. In such circumstances, when an order for provisional release of the goods has been passed by the Commissioner, it is ordered that the goods seized shall not be disposed of for a period of eight weeks from today.
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2021 (9) TMI 1546
TP Adjustment - comparable selection - HELD THAT:- Deselection of comparables as functionally dissimilar with that of assessee.[Accentia Technologies Ltd., Acropetal Technologies Ltd., Coral Hubs Ltd.,Cosmic Global Ltd.,Eclerx Services Ltd., and Genesys International Corporation Ltd.]
Foreign exchange fluctuation gain should be treated as part of operating revenue - We find that the assessee had derived foreign exchange fluctuation gains only on re-statement of outstanding debtors as on the balance sheet date. This, in our considered opinion, would certainly form part of only operating revenue of the company. Reliance in this regard has been rightly placed by the ld. AR on the Co-ordinate bench decision of this Tribunal in the case of India Medtronics Pvt. Ltd.,[2019 (10) TMI 122 - ITAT MUMBAI]. On perusal of the financial statements, we also find that the assessee company had not resorted to any hedging transactions as wrongly reported by the ld. DRP while adjudicating this issue. Accordingly, we direct the ld. TPO to include the forex gain as part of operating revenue.
If the said forex gain is treated as operating revenue and the aforesaid six comparable companies are excluded, the assessee would be well within the +/-5% tolerance range as per proviso 2 to Section 92C(2) of the Act - we hold that there is no need to make any transfer pricing adjustment in respect of provision of IT enabled services by the assessee to its AEs.
Denial of deduction u/s. 10A - interest income earned by the assessee - AO held that these fixed deposits were placed by the assessee out of surplus funds lying with it and hence, the interest earned thereon would be liable to be separately taxed under the head “income from other sources” and consequently not eligible for deduction u/s. 10A - HELD THAT:- We find that similar issue had cropped up in assessee’s own case before this Tribunal in A.Y. 2011-12 [2021 (7) TMI 53 - ITAT MUMBAI] wherein this Tribunal treated the said interest income as part of business receipts earned by the assessee by placing reliance on the decision of Hewlett Packard Global Soft Ltd [2017 (11) TMI 205 - KARNATAKA HIGH COURT]; decision of Cybertech Systems & Software[2018 (3) TMI 528 - BOMBAY HIGH COURT] wherein it was held that all profits and gains including incidental income of an Export Oriented Unit (EOU) even in the nature of interest on bank deposits or soft loans would be entitled for deduction u/s. 10A or 10B of the Act. Thus we direct the ld. AO to grant deduction u/s. 10A of the Act in respect of interest income earned on fixed deposits. Accordingly, the ground raised by the assessee is allowed.
Treatment of forex gain and re-valuation of foreign currency held in EEFC account and consequently its eligibility to claim deduction u/s. 10A - HELD THAT:- As decided in own case [2021 (7) TMI 53 - ITAT MUMBAI] assessee has claimed deduction u/s. 10A of the Act, wherein deduction is available on the profits derived by the assessee on the entire profits and gains derived by the undertaking engaged in the business of export of articles or things. This Tribunal had also placed reliance on the decision of Motorola India Electronics Pvt. Ltd. [2014 (1) TMI 1235 - KARNATAKA HIGH COURT] wherein it was held that what is exempted is not merely the profits and gains of the export of articles but also the income from the business of the undertaking. Proceeding further, the Hon’ble High Court also observed that export profits kept in the EEFC account are the income of the business undertaking, hence the assessee would be entitled for deduction u/s. 10A of the Act for the same.
Short grant of credit for TDS - HELD THAT:- We find that this is a matter of factual verification and the ld. AO is hereby directed to grant TDS credit in accordance with law. Accordingly, the ground No. 17 is allowed for statistical purposes.
Deduction on account of education cess - HELD THAT:- We find that this additional ground deserves to be admitted as all the facts necessary for its adjudication are already on record and there is no dispute that assessee had indeed paid the education cess. Hence, following case of Sesa Goa Ltd.[2020 (3) TMI 347 - BOMBAY HIGH COURT] we direct the ld. AO to grant deduction on account of education cess paid by the assessee as an allowable business expenditure. Accordingly, the additional ground raised by the assessee is allowed.
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2021 (9) TMI 1545
TP Adjustment - comparable selection - assessee restricted his pleadings only qua wrongful inclusion of two comparables M/s. HSIL Ltd and M/s. Cera Sanitary Ware Limited by the Transfer Pricing Officer (TPO) - HELD THAT:- DR fails to dispute that the DRP herein has nowhere taken into consideration the assessee's detailed objections quoting functional similarity, lack of the relevant segmental financials and engagement of the said twin entities in R & D activities, whilst declining the impugned objection in a cryptic manner.
Faced with this situation, we deem it appropriate to restore the assessee's instant substantive grounds back to the DRP for its afresh adjudication on merits after considering all the detailed evidence filed; as per law within three effective opportunities of hearing. Assessee's appeal is partly accepted for statistical purposes.
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2021 (9) TMI 1544
Nature of activity - sale or service - Process amounting to manufacture - activity of crushing, pulverizing, converting and packing of spices into powder - levy of service tax under the category of ‘business auxiliary service’ or not - HELD THAT:- This issue has been answered by the Larger Bench of the Tribunal in NILGIRI OIL & ALLIED INDUSTRIES VERSUS COMMISSIONER OF CENTRAL EXCISE, CUSTOMS, HYDERABAD – IV [2021 (6) TMI 26 - CESTAT HYDERABAD] where it was held that 'Each of the whole spices or seeds is subject to processing for production of powder. The transformed product has its own market similar to, and yet independent of, the harvested product that is subjected to processing. It is the particular use to which powdered spice is put to that prompted the establishment of an entire industry. Furthermore, without such processing there would be an unsatiated demand for powdered spice which would have to be undertaken, with additional labour, in domestic kitchens. Every aspect of ‘manufacture’, as settled by judicial determination, is, thus, complied with.'
The demand cannot sustain - appeal allowed.
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2021 (9) TMI 1543
Violation of principles of natural justice - ex-parte order - failure to file appeal within the stipulated period - CENVAT Credit - mentioning of wrong address in the invoice - invoice of M/s. Reliance bore address of Nagalpur unit and payment was also made from the bank account of Nagalpur unit, thus, the Cenvat credit taken by the petitioner of Dediyasan factory denied - HELD THAT:- There is gross violation of principle of natural justice by adjudicating authority in adjudicating inasmuch as submissions and evidence on record have not been considered while passing the ex-parte order on 22.08.2019.
There is also non-compliance of section 35C of the Central Excise Act in conducting and concluding de novo examination after the matter was remanded by the CESTAT and therefore, there is violation of principle of natural justice - It is mandatory provision laid down under section 27C of the Act for serving any decision, order, summons or notice to the parties. In the present case, it is nowhere recorded not proved that the notice for hearing notice was sought to be served upon the petitioner firstly by tendering at the petitioner’s premises or sending by registered AD Post, or Speed Post or affixing notice at any conspicuous part of the factory or office or residential premises, of the petitioner. When the notice could be served upon the petitioner, the same can be affixed under the Panchnama in the office of the adjudicating authority. No such kind of procedure is adopted by the respondent authority.
The Additional Commissioner, adjudicating authority proceeded ex-parte and mandatory provisions under section 37C is not complied with after the de-novo proceeding was initiated.
The Larger Bench of this Court in the case of PANOLI INTERMEDIATE (INDIA) PVT. LTD. VERSUS UNION OF INDIA AND 2 [2015 (7) TMI 303 - GUJARAT HIGH COURT] has further observed that it is not possible to observe that in a case where the limitation period of preferring appeal or further period of condonation of delay is over, the High Court will have no jurisdiction under Article 226 of the Constitution but the exercise of such power has to be in exceptional cases where gross injustice is satisfactorily demonstrated. Otherwise, in normal circumstances, the High Court would give appropriate weightage to the statutory provisions because the things which cannot be done directly as per the statute cannot be permitted to be done indirectly in writ jurisdiction unless a grave and strong case is made out before the High Court that noninterference to the order under challenge would result into a gross injustice to the party suffering the order.
The impugned order of Additional Commissioner dated 27.08.2019 is hereby quashed and set aside without entering into the merits of the matter - the present petition is disposed off.
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2021 (9) TMI 1542
TDS u/s 195 - Royalty - amounts paid by the concerned persons resident in India to non-resident, foreign software suppliers - Whether constitutes as taxable income deemed to accrue in India u/s 9(1)(vi) - income deemed to accrue or arise in India - HELD THAT:- As assessee submits that the substantial questions of law raised herein are squarely covered in the case of Engineering Analysis Centre of Excellence Private Limited [2021 (3) TMI 138 - SUPREME COURT]
Revenue could not dispute the same.In view of the aforesaid submissions, the substantial questions of law are answered in favour of the assessee and against the revenue.
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2021 (9) TMI 1541
Disallowance of depreciation on goodwill - As per the scheme of amalgamation, where value of liabilities and amount of equity capital allotted /payment to the equity shareholders exceeds the value of assets of the transferor company taken over, such excess shall debited to the goodwill account - HELD THAT:- We find that this claim is no more res-integra as the issue has been settled in favour of the assessee and against the revenue by the decision of in the case of Smifs Securities Ltd. [2012 (8) TMI 713 - SUPREME COURT] We do not find any error or infirmity in the findings of the CIT(A). Decided against revenue.
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2021 (9) TMI 1540
Suit for cancellation of Power of Attorney - Mutation of property - whether there is any criminal offence disclosed in the FIR so far as the Appellant is concerned? - HELD THAT:- The scope of interference by the High Court under Section 482 of the Cr.P.C. is wide as recorded by the High Court by the judgment and order impugned. The High Court itself has said that though inherent power under Section 482 of the Cr.P.C. is very wide, it has to be exercised in exceptional cases.
There can be no doubt that the jurisdiction under Section 482 is not exercised for the asking, it is exercised with care in exceptional cases. The scope of interference with an FIR is much more restricted and ordinarily the Court does not interfere under Article 226 of the Constitution of India, when there is an alternative remedy available to the applicant. Furthermore, from the tenor of the order of the High Court rejecting the writ petition, it is patently clear that one of the reasons why the High Court did not intervene at that stage was that the Police report had also not been submitted. The Police report has since been submitted and the charge sheet has been filed. It is true that about 12-13 witnesses have been named. However, the said Bela Rani who executed the Power of Attorney has not even been cited as a witness. Apparently, the said Bela Rani was not even examined by the Investigating Authorities.
The charge sheet is totally vague. There is not even a whisper in the charge-sheet of what transpired from the investigation against the Appellant herein - A fraudulent, fabricated or forged deed could mean a deed which was not actually executed, but a deed which had fraudulently been manufactured by forging the signature of the ostensible executants. It is one thing to say that Bela Rani fraudulently executed a Power of Attorney authorising the sale of property knowing that she had no title to convey the property. It is another thing to say that the Power of Attorney itself was a forged, fraudulent, fabricated or manufactured one, meaning thereby that it had never been executed by Bela Rani. Her signature had been forged.
In Uma Shankar Gopalika [2004 (3) TMI 807 - SUPREME COURT], this Court found that the complaint, in that case, did not disclose any criminal offence at all, much less any offence under Section 420 or Section 120B IPC. The case was purely a civil dispute between the parties for which remedy lay before the civil Court.
In this case, it appears that criminal proceedings are being taken recourse to as a weapon of harassment against a purchaser. It is reiterated at the cost of repetition that the FIR does not disclose any offence so far as the Appellant is concerned. There is no whisper of how and in what manner, this Appellant is involved in any criminal offence and the charge sheet, the relevant part whereof has been extracted above, is absolutely vague. There can be no doubt that jurisdiction under Section 482 of the Cr.P.C. should be used sparingly for the purpose of preventing abuse of the process of any court or otherwise to secure the ends of justice - The High Court has, however, to see whether the dispute of a civil nature has been given colour of criminal offence. In such a situation, the High Court should not hesitate to quash the criminal proceedings as held by this Court in PARAMJEET BATRA VERSUS STATE OF UTTARAKHAND AND ORS. [2012 (12) TMI 1219 - SUPREME COURT].
The given set of facts may make out a civil wrong as also a criminal offence. Only because a civil remedy is available may not be a ground to quash criminal proceedings. But as observed above, in this case, no criminal offence has been made out in the FIR read with the Charge-Sheet so far as this Appellant is concerned. The other accused Rajan Kumar has died.
The impugned judgment and order of the High Court is set aside and the proceedings in Crime Case No.5973/2020 are quashed as against the Appellant - Appeal allowed.
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2021 (9) TMI 1539
Seeking bail application u/s 439 CrPC - Offences punishable under Sections 132(1)(b), (c) (f), (j), (k) and (1) r/w Section 132(5) of the Central Goods and Service Tax Act, 2017 - HELD THAT:- The fact that conclusion of the proceedings is likely to take some time and without expressing any opinion on the merits of the case, this Court deems it just and proper to grant bail to the accused petitioner u/s 439 CrPC. Accordingly, this bail application filed u/s 439 CrPC is allowed
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2021 (9) TMI 1538
Rectification of mistake - TP adjustment on account of payment of I.T. Licence Maintenance cost - HELD THAT:- We find that the CIT(A) in the impugned order has given a finding that no tax has been deducted by the assessee on payment for I.T. Licence Maintenance Cost. Whereas, the contention of assessee is that the assessee has deducted tax at the rate of 21.115% under section 206AA of the Act. The Tribunal after considering entire facts has restored the issue back to the file of TPO/AO to reexamine the issue. Since, the issue required examination of documents, the Tribunal has rightly restored the issue back to TPO/AO. Assessee has failed to point out any mistake much less any apparent mistake requiring indulgence u/s 254(2) of the Act. Therefore, the first prayer made by assessee is rejected.
Adjustment on account of payment of interest on trade creditors - Tribunal has wrongly mentioned in the order that the assessee filed additional evidence i.e. Circular issued by Peri GMBH (Parent company of the assessee/applicant) - As assessee made a statement at the Bar that though the said circular was filed but no reliance was being placed on that circular and prayer to admit aforesaid circular as additional evidence was not made. The assessee does not want to place reliance on the said circular as the issue can be decided without making reference to the above circular. In the light of statement made by assessee, we are of considered view that the error has crept in the order of Tribunal in taking cognizance of the circular as additional evidence. Since, no reliance was placed by assessee, the Tribunal has erred in taking cognizance of the circular. Therefore, the second prayer of the assessee seeking rectification of the finding in para-11 of the order of Tribunal [2021 (3) TMI 403 - ITAT MUMBAI] is accepted.
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2021 (9) TMI 1537
Disallowance of speed money expenditure - perusal of the loose sheets found in search - ITAT while considering the case of the Revenue challenging the allowance of 90% of speed money observed that “mere perusal of the loose sheets it is clear that about 10% of the cash payments was made to the officials of the port trust” and disallowance to the extent of 10% is just and proper.
HELD THAT:- This order amounts to allowing the appeals filed by the assessee which are still pending where the challenge is made to the extent of disallowance of 10%. On further miscellaneous petitions filed by the assessee strangely the Tribunal has held that no finding has been rendered as to the nature of payments found in loose sheets which is ex-facie contrary to the finding recorded in the order dated 02.05.2017. This would indicate that the Tribunal has not applied its mind while arriving at the conclusion.
Tribunal being the last fact finding authority ought to have discussed the factual aspects, more importantly when the Assessing Officer has made efforts to discover the tax evasion, placing reliance on the incriminating materials seized and the statements of the relevant persons recorded. Instead of adjudicating on the challenge made by the Revenue, passing the orders to the effect of deciding the subject matter of the appeals filed by the assessee which were not before the Tribunal, amounts to perversity and suffers from patent illegality. The impugned orders lack application of mind and reasoning.
Given the circumstances, we have no other option except to set aside the impugned orders and remand the matter to the Tribunal for reconsideration, keeping open all the rights and contentions of the parties sans answering the substantial questions of law.
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2021 (9) TMI 1536
Characterization of receipts - Chargeability of interest on deposits/loans - assessee has been following this system from the earlier years and the interest income has been offered as a business income - only difference of opinion with the CIT(A) that, these surplus funds are not necessary to the assessee and there is no requirement for the assessee to make deposits - HELD THAT:- As in the present case, the assessee company has earned interest on bank deposits and on short term call money loan. AR demonstrated working of interest income on bank deposits and interest on term loan - interest income earned on the term loan provided @6% p.a. in the August 2005 was continuing and interest income was offered in earlier financial years.
Borrower of loan has provided guarantee to lenders of the assessee company which benefited substantially to the assessee business projects and operations. Since the term loan provided by the assessee to the barrower is linked in obtaining counter guarantee to assessee business prospects and there exist the nexus of business transactions. We considering all are of the opinion that interest income earned by the assessee take the character of business transaction and to be treated as business income. Accordingly, we direct the Assessing Officer to treat the interest income taxable as business income and allow the grounds of appeal of the assessee.
Claim of depreciation u/s 32(1)(ii) - right to set up an infrastructure facility and collect annuity thereon - assessee had constructed the Road and have the right to earn revenue in the form of annuity from the use of such intangible Asset being license or business or commercial right contemplated under the provisions of the Act - HELD THAT:- We considering the factual aspects, circumstances, legal decisions West Gujarat Expressway Ltd [2016 (4) TMI 1184 - BOMBAY HIGH COURT] ,Infrastructure Leasing & Financial Services ltd [2019 (12) TMI 1499 - ITAT MUMBAI] are of the opinion that the assessee is eligible for depreciation on Road on (B.O.T) basis treating it as Intangible Asset under section 32(1)(ii) of the Act. Accordingly, we direct the assessing officer to grant depreciation as discussed and allow the additional ground of appeal in favour of the assessee.
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2021 (9) TMI 1535
Penalty u/s 271D - allegation of non recording of satisfaction by AO before initiation of any penalty - HELD THAT:- As perused the assessment order passed by the AO the assessment order is conspicuously silent on recording of any satisfaction by the assessing officer for the purpose of initiative the penalty u/s 271D.
In our considered opinion the recording of satisfaction by the AO is essential for initiation of any penalty u/s 271D of the act and failure to record, the satisfaction in the manner provided by the law and more particularly in the light of the judgement, is fatal, and accordingly the penalty proceedings initiated against the assessee by the assessing officer and confirmed by the CIT(A) are required to be quashed - Appeal of assessee allowed.
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2021 (9) TMI 1534
Whether the amended provision can be given prospective effect only? - HELD THAT:- The State is under statutory obligation to conclude the assessment process for the period prior to 01.07.2017 on the basis of unamended rules; and commence the assessment for the subsequent period as per the new regime which has come into force from 01.07.2017.
The department is free to proceed with the assessment on the basis of unamended rules which, however, will be subject to challenge as may be available in law to the assessees before the appropriate Forum. The special leave petitions are disposed of accordingly.
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2021 (9) TMI 1533
Depreciation on intangibles - trademarks owned wholly or partly by the assessee - assessee succeeded to the business of the partnership firm, which had trademarks registered in its name - As decided by HC [2020 (10) TMI 424 - KARNATAKA HIGH COURT] assessee u/s 32(1) was entitled for depreciation with reference to actual cost incurred by it with reference to intangible assets - 5th proviso in any case will apply only in the year of succession and not in subsequent years and also in respect of overall quantum of depreciation in the year of succession and Tribunal committed an error of law in upholding the order of Commissioner of Income Tax (Appeals) in invoking Explanation 3 to Section 43(1) -
HELD THAT:- Issue notice, returnable on 08.11.2021.
Dasti service, in addition, is permitted.In the meantime, the impugned judgment and orders passed by the High Court are stayed.
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2021 (9) TMI 1532
Blocking the enforcement of a security interest, created in favour of a secured creditor - purpose for which the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (the SARFAESI Act) was enacted, is defeated - HELD THAT:- This Court observed that the equity of redemption is not extinguished by mere contract for sale and that the mortgagor's right to redeem will survive until there has been completion of sale by the mortgagee by a registered deed. This Court further observed that applying the principles stated with reference to Section 60 of the Transfer of Property Act in respect of a secured interest in a secured asset in favour of the secured creditor under the provisions of the SARFAESI Act and the relevant Rules applicable, a free hand is given to a secured creditor to resort to a sale without the intervention of the court or tribunal. It has, however, been held that Under Section 13(8), it is clearly stipulated that the mortgagor, i.e., the borrower, who is otherwise called as a debtor, retains his full right to redeem the property by tendering all the dues to the secured creditor at any time before the date fixed for sale or transfer. This Court further held that if the tender is made by the borrower at the last moment before the sale or transfer, the secured asset should not be sold or transferred by the secured creditor.
This Court held that there was no reason as to why the general principle laid down by this Court in the case of Narandas Karsondas [1976 (12) TMI 186 - SUPREME COURT] with reference to Section 60 of the Transfer of Property Act could not have application in respect of a secured interest in a secured asset created in favour of a secured creditor. It has been held that the said principles will apply on all fours in respect of a transaction as between the debtor and secured creditor under the provisions of the SARFAESI Act.
This Court, in unequivocal terms, held that unless and until a clear 30 days' notice is given to the borrower, no sale or transfer can be resorted to by a secured creditor. It further held that in the event of any such sale properly notified after giving a 30 days' clear notice to the borrower did not take place as scheduled for reasons, which cannot be solely attributable to the borrower, the secured creditor cannot effect the sale or transfer of the secured asset on any subsequent date by relying upon the notification issued earlier - This Court held that once the sale does not take place pursuant to a notice issued Under Rules 8 and 9, read with Section 13(8) for which the entire blame cannot be thrown on the borrower, it is imperative that for effecting the sale, the procedure prescribed will have to be followed afresh.
The SARFAESI Act was enacted with the purpose for securitization and empowering banks and financial institutions to take possession of the securities and to sell them without the intervention of the Court - looking in the present case, it would show that, every attempt has been made to frustrate the purpose of the SARFAESI Act. The Respondent-Bank was required to indulge in three rounds of litigations, out of which, the two have reached upto this Court.
Though the auction purchaser emerged as the successful bidder, in the bids held on 20.7.2012, and though the sale was confirmed on 21.7.2012, and though the sale has been registered in his favour on 14.9.2012, for a period of last 9 years, he could not enjoy the fruits of the said sale. Not only that, but the Appellants continued to enjoy the rent of the properties, the ownership of which vests in the auction purchaser - there are no merit insofar as the challenge to the notice dated 9.7.2012 is concerned.
It is also submitted that the amount received by the Respondent-Bank was on account of sale of all the four properties mentioned in the First Sale Notice dated 21.1.2012, and as such, the direction to pay an amount of Rs. 4.48 crore with interest only to Respondent No. 3 is not sustainable - there are no merit in this submission. The property at Item 'B' of the Schedule of Properties in First Sale Notice dated 21.1.2012 was sold through a private treaty during the pendency of the first round of litigation. The properties at Item 'A' and Item 'D' of the Schedule of Properties in First Sale Notice dated 21.1.2012 came to be sold in pursuance of the sale taken place on 20.7.2012, which was in pursuance of the Second Sale Notice dated 9.7.2012. As such, the only property left was the property at Item 'C' belonging to the Respondent No. 3 in respect of which a third notice dated 27.9.2012 came to be issued. It is only in pursuance of the said notice dated 27.9.2012, that the property at Item 'C' was sold by a private treaty to M/s. Redbrick Realtors Private Limited. As such, the excess amount, which remained with the Respondent-Bank, has rightly been directed to be paid to Respondent No. 3 by the DRT, Chennai, which has been concurrently upheld by the DRAT, Chennai, as well as the High Court.
The appeals are therefore found to be without merit, and as such, are dismissed with costs.
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