|
Advanced Search Options
Case Laws
Showing 301 to 320 of 420205 Records
-
2024 (11) TMI 1178
CENVAT Credit - outward GTA service used in connection with clearance of excisable goods namely cement from the factory premise to buyer premise - inclusion of cost of transportation in the assessable value - HELD THAT:- The fact is not under dispute that the appellant have undertaken to deliver the goods at the customer’s premises. The freight charges of GTA on which Cenvat credit was taken is included in the assessable value of the excisable goods. This is evident from the excise invoice raised by the appellant.
From the perusal of the above invoice, it is observed that the freight charges was not separately collected by the appellant, therefore, the same is deemed to be included in the assessable value on which the excise duty was paid. In this identical fact the issue in hand is covered by this Tribunal’s judgment in the case of Ultratech Cement Ltd. [2019 (2) TMI 1487 - CESTAT AHMEDABAD] which was upheld by the Hon’ble Gujarat High Court reported at the Commissioner, Central Goods and Service Tax versus M/s. Ultratech Cement Ltd. [2020 (3) TMI 1206 - GUJARAT HIGH COURT].
The issue involved in the present case is no longer res-integra and accordingly the appellant are entitled for Cenvat credit on outward GTA in the facts of the present case. Hence, the impugned orders are set aside - Appeal allowed.
-
2024 (11) TMI 1177
Eligibility for Exemption N/N. 3/2005-CE (amended by Notification 12/2012-serial No. 203) in respect of final product namely Pattis and Pattas - denial of exemption on the ground that as per the description of goods the Pattis and Pattas when subjected to any process other than cold rolling, therefore, in order to be eligible for exemption the Pattis and Pattas manufactured by the appellant must undergo any process other than cold rolling - when the description of goods in the exemption entry to be a condition that the Pattis and Pattas should be subjected to any process other than cold rolling and in absence of any process whether the appellant is eligible for exemption?
HELD THAT:- This issue has been clarified by the Board whereby it was clarified that even if no process is carried out on Pattis and Pattas, the exemption is available. This issue has been considered in detail relying on the said Circular in case of MULTI METAL INDUSTRIES; MORE METAL INDUSTRIES & HAJARILAL RAMCHANDRA SHARMA VERSUS C.C., AHMEDABAD [2023 (10) TMI 1457 - CESTAT AHMEDABAD] where it was held that 'In the present case the Hot Rolling process is admittedly the process which is taken place prior to the process of cold rolling, therefore, in view of the clarification, the Hot Rolled Pattas and Pattis are clearly covered under the Notification No 12/.2012- CE dated 17.03.2012 under Sr. No. 203.'
From the above decision, it can be seen that very identical issue involved in the present case as well in the case cited above. Therefore, the ratio of the above judgment is directly applicable in the present case. Accordingly, the impugned order in the assessee’s appeals are set aside and impugned order in the Revenue’s appeal is uphed.
Assessee’s appeals are allowed. Revenue’s appeal is dismissed.
-
2024 (11) TMI 1176
Levy of Excise duty on the job work goods supplied to the customer - activity of cutting, welding, bending etc. for manufacture of parts of structure - Process amounting of amount to manufacture - HELD THAT:- There are catena of judgments, some of the judgments are contrary. Therefore, it clearly shows that the issue was highly debatable and there is a very thin difference between whether the activity amounts to manufacture or otherwise. Therefore, in such case, the matter can be decided only on the ground of limitation without giving final conclusion to the merit of the case. As regard the issue raised by the appellant for demand being time barred, on careful examination of the facts and record, it is found that it is not a case where the appellant have out rightly evaded the duty, firstly, the activity involved is whether manufacture or otherwise covered by the various judgments cited by the Learned Counsel wherein, in various judgments, it is held that the activity of cutting, welding, bending etc. do not amount to manufacture.
At the same time there are contrary judgments to each other and the matter was decided by the Larger Bench in the case of MAHINDRA & MAHINDRA LTD. VERSUS CCE., AURANGABAD, CHANDIGARH, KANPUR & CHENNAI [2005 (11) TMI 103 - CESTAT, NEW DELHI]. However, the specific activity has to be looked into in each and every case, then only this judgment can be applied. Therefore, in this undisputed fact the issue involved is of interpretation of the term manufacturer. Therefore, no malafide intention can be attributed to the appellant. Secondly, the appellant who were registered under service tax and discharging the service tax liability on the very same activity which as per department is amount to manufacture.
Once the appellant have under bonafide belief assessed the activity as service and paid the service tax and have been filing their ST-3 return regularly. It was open to the department to question about the nature of activity and can raise the demand if at all they are of belief that the activity is amount to manufacture well within the normal time. In this position, nothing prevented the department to issue show cause notice within the normal period. Therefore, since there is absolutely, no suppression of fact and malafide intention, the demand is hit by limitation. The period of demand is 2011-2013 and show cause notice was issued almost after 3-4 years i.e. on 18.01.2017. Accordingly, entire demand is beyond the normal period. Hence, the same is not sustainable on the ground of limitation itself.
Since, the appellant have no malafide intention and they have not suppressed any fact from department with intent to evade payment of duty. For the same reason, no penalty under Section 11 AC is imposable. Accordingly, the demand is set aside only on the ground of limitation without giving the conclusive findings on the merit i.e. whether the activity amounts to manufacture and otherwise.
The impugned order is set aside, appeals are allowed.
-
2024 (11) TMI 1175
Demand of Excise duty with interest and penalty - mis-classification of products as under Chapter Heading 8707 instead of Chapter Heading 8704 - manufacturing goods for mounting on duty-paid Chassis - benefit of N/N. 6/2006-CE dated 01.03.2006 Sl.No.87 as amended by another N/N. 12/2012-CE dated 17.03.2012 Sl.No.334 - Extended period of limitation - HELD THAT:- In MESSRS DISHA ENGINEERS VERSUS C.C.E. -AHMEDABAD-I [2022 (5) TMI 476 - CESTAT AHMEDABAD] and M/S AMCL MACHINERY LTD VERSUS COMMISSIONER OF CUSTOMS & C. EX. [2019 (8) TMI 250 - CESTAT MUMBAI], the assessee has classified their products under Chapter Heading 8704 and claimed exemption under Notification No.6/2006-CE dated 01.03.2006 Sl.No.87 as amended by another Notification No.12/2012-CE dated 17.03.2012 Sl.No.334, which is not the case in hand. The appellant admittedly classified their products under Chapter 8707 instead of 8704. In that circumstances, the cases relied upon by the ld.Counsel for the appellant, are not applicable to the facts and circumstances of the case.
But the appellant agreed upon that as they were filing ER-1 Returns regularly and classified their product under Chapter Heading 8707 claiming exemption Notification No.6/2006-CE dated 01.03.2006 Sl.No.87 as amended by another Notification No.12/2012-CE dated 17.03.2012 Sl.No.334, the extended period of limitation is not invokable.
In that circumstances, the extended period of limitation is not invokable in this case. Therefore, the demand pertaining to the extended period of limitation is dropped and in the facts and circumstances of the case, no penalty is imposable on the appellant.
The demand pertaining within the limitation is confirmed. Accordingly, the same shall be paid by the appellant along with interest, (if not paid) within 30 days from the date of receipt of this order - No penalty is imposable on the appellant - the appeal is disposed off.
-
2024 (11) TMI 1174
CENVAT Credit of input services relating to captive mines - Input Service Distributor (ISD) - distribution of credit by the captive mines to the manufacturing units of the SAIL through ISD invoices - HELD THAT:- The issue is no longer res integra as this Tribunal has already decided the same issue in their own case for the period June 2016 to June 2017, in M/S STEEL AUTHORITY OF INDIA LIMITED VERSUS COMMISSIONER OF CGST & CENTRAL EXCISE, BOLPUR [2023 (12) TMI 1062 - CESTAT KOLKATA], wherein, on similar facts, it has been held by this Tribunal that the Appellant is entitled to avail CENVAT Credit of input services relating to captive mines. The present appeal covers the period 2006-07 to 2011-12 (up to June 2012), for the same unit.
The mines and the Appellant’s manufacturing unit belongs to one legal entity, which is engaged in manufacture of dutiable goods. Therefore, the observation given by the Ld. Commissioner that distribution of credit by the mines is in contravention of Rule 7(b) of the CENVAT Credit Rules is legally not tenable. Thus, the distribution of credit by captive mines as ISD is in accordance with the provisions of law.
The demands of service tax along with interest and penalty confirmed in the impugned order set aside - appeal allowed.
-
2024 (11) TMI 1173
Seeking grant of pre-arrest bail - offences punishable under Sections 9, 39, 48 and 48A read with 51 of the Wild Life (Protection) Act, 1972 - capturing six ball pythons, a golden child retic, three striped mud turtles, an Indian star turtle, a marmoset monkey, and an iguana on a specified premises - HELD THAT:- From a cursory reading of Schedule I of the Act, it appears that the Indian star turtle does not form part of this Schedule, and the other animals are included in Appendix I to Schedule I. Under Section 51 of the Act, this violation is punishable for imprisonment for a term upto three years, a fine extended to Rs.1 lakh, or both. It is acknowledged that the applicant was not present during the alleged raid. Upon a perusal of the records, particularly, the leave and license agreement of the premises, it appears that the applicant was neither the owner nor the licensee of the premises. The applicant merely attested to the document as a witness, which in itself does not suggest his involvement in the crime. At this stage, the material on record does not prima facie incriminate the applicant in the present crime.
Additionally, the animals have been seized and it is reported that the animals have been relocated as required by law. The prosecution’s apprehension about evidence tampering and witness influence can be addressed by imposing appropriate conditions. In these circumstances, this Court is inclined to exercise its discretion in favour of the applicant.
In the event of the applicant’s arrest in connection with Forest Offence Report No.WL-08-2024 (also registered as WL-61- 2024), he shall be released on bail upon executing a PR Bond of Rs.25,000/- and furnishing one or more sureties in the like amount - Application disposed off.
-
2024 (11) TMI 1172
Termination of Agreements - specific performance of contract - Balance of Convenience - Irreparable Loss - Section 11 of the Arbitration and Conciliation Act 1996 - HELD THAT:- The scope of interference with discretionary orders of injunction by the appeal Court is quite limited. The appeal Court will not interfere with the exercise of discretion of the Court of first instance and substitute its own discretion except where the discretion is shown to have been exercised arbitrarily, capriciously or perversely or where the Court had ignored the settled principles of law regulating grant or refusal of interlocutory injunctions. An appeal against the exercise of discretion is an appeal on principle. The appellate Court will not reassess the material and seek to reach a conclusion different from the one reached by the Court below solely on the ground that if it had considered the matter at the trial stage it would have come to a contrary conclusion. If the discretion has been exercised by the trial Court reasonably and in judicial manner, the fact that the appellate Court would have taken a different view may not justify interference with the trial Court’s exercise of discretion.
Any direction to treat the applications under Section 9 as Section 17 applications would involve complications, though it might save paper. Subsequent developments might be difficult to record. Therefore, it would be appropriate to grant the parties leave to file applications under Section 17, which could then be decided without being influenced by this interim arrangement.
The above arrangement will operate as an ad-interim arrangement. The parties may file their applications under Section 17 within four weeks from today. The above ad- interim arrangement shall operate until the Arbitral Tribunal disposes of Section 17 applications, if filed or until the Arbitral Tribunal may direct. The Arbitral Tribunal must decide the applications under Section 17 without being influenced by any observations in the impugned judgments and orders dated 20 September 2024 or this judgment and order.
The ad-interim orders granted in these Appeals are vacated since now the parties would have to abide by the ad- interim arrangement now indicated.
Appeal disposed off.
-
2024 (11) TMI 1171
Professional misconduct - scope of clause (7) of Part-1 of Second Schedule to the Act - whether, on the basis of the material available on record, the petitioner has been rightly held guilty of professional misconduct, as covered under clause (7) of Part I of the Second Schedule to the Act, and whether an order from this Court under Section 21(6) of the Act is merited? - HELD THAT:- Coordinate Bench of this Court in case of Institute of Chartered Accountants of India, New Delhi v. B.L. Khanna & Anr. [2000 (9) TMI 1094 - DELHI HIGH COURT], had the occasion to explain the scope of clause (7) and the meaning of ‘gross negligence’. It was held that whether the professional was grossly negligent or not would depend on the fact whether he had applied his mind diligently to the job entrusted to him, and whether due care and caution, as is required to be adopted, was taken. Additionally, it should also be seen whether there was failure to act honestly or reasonably. It was also observed that “when a Chartered Accountant signs certificates, minimum that is expected to do is to verify the accuracy of the figures certified.”
It does appear that the respondent no. 1, on the mere asking of the Society, and without seeking any document from the Society in this regard, had mentioned amount of ₹ 41,000/- as expenditure towards Additional Essential Machinery in the second Utilisation Certificate, and also later certified that this certificate would supersede all the previous certificates issued by him. There was also no reason assigned by him in the said clarification, as to why the second Utilisation Certificate would supersede the previous certificates issued by him.
It is noted that in the case of Council of Institute of Chartered Accountants of India v. Dayal Singh FCA, [2007 (5) TMI 696 - DELHI HIGH COURT], the allegations against the respondent therein (a chartered accountant) were that he was instrumental in getting a loan sanctioned from Union Bank of India in favor of an entity, on the basis of forged documents such as quotations, supply orders, money deposit receipts of various firms, rent deed and rent receipts etc., and that he had given a false certificate stating that the concerned entity had brought the contribution required in the books on the basis of which loan had been released from Union Bank of India.
Similarly, in The Institute of Chartered Accountants of India v. Manakchand Laxman Baheti, [2023 (10) TMI 1101 - BOMBAY HIGH COURT], the Division Bench of Bombay High Court noted that the reports of the Disciplinary Committee had revealed that the respondent therein (a chartered accountant) had no documents on the basis of which the certificates were issued by him. The certificates simply stated that they had been issued on the specific request of the firm. On being asked to produce documents regarding statements of expenditure incurred by the firms, invoices/vouchers for purchase of plant and machinery for civil work and land development etc., the respondent therein was unable to produce any document.
The conduct of the respondent no. 1 in issuing the first Utilisation Certificate would not amount to ‘gross negligence’, the fact that while issuing the second Utilisation Certificate dated 28.01.2004, the respondent no. 1 did not seek any document such as invoices or receipts or bank statements or road permit for bringing machinery in the State of Manipur (as it appears from the record) from the Society which would show return of machinery of ₹ 2,50,000/- and purchase of another set of machinery of ₹ 41,000/-, would amount to lack of due diligence and gross negligence on part of the respondent no. 1, more so when the Utilisation Certificates issued by the respondent no. 1 were for the purpose of securing loans from the complainant.
The Council has not erred in holding the respondent no. 1, guilty of professional misconduct under clause (7) of Part-I of Second Schedule to the Act - Insofar as the recommendation for removing the name of respondent no. 1 from the Register of Members for one year is concerned, it is noted that the respondent no. 1 has been a member of ICAI for approximately three decades, with no history of any other complaint or allegation of misconduct on record. The present complaint was filed against him in the year 2005, and the proceedings against him have remained pending for about 19 years.
Considering that the present proceedings have continued for 19 years without any history of professional misconduct by the respondent no. 1, the ends of justice would be served by severely reprimanding the respondent no. 1, under Section 21(6)(b) of the Act, for his professional misconduct - the present reference is disposed of.
-
2024 (11) TMI 1170
Levy of penalty u/s 129(1)(b) of the Central Goods and Services Tax Act, 2017 read with Section 20 of the Integrated Goods and Services Tax Act - HELD THAT:- From a perusal of the documents annexed with the writ petition, it appears that the authorities have not challenged the invoice and/or e-way bill produced by the petitioner nor have they questioned the fact of purchase of the areca nuts from a third party which was then being supplied by the petitioner to the consignee. The petitioner also relies on the Circular No.76/50/2018-GST, dated December 31, 2018 that states that if the invoice or any other specified document is accompanying the consignment of goods, then either the consignor or the consignee should be deemed to be the owner.
Reliance placed on the Division Bench judgment of this Court in the case of H/S HALDER ENTERPRISES VERSUS STATE OF U.P. AND OTHERS [2023 (12) TMI 514 - ALLAHABAD HIGH COURT] wherein it has been held that the Department is bound by the aforesaid circular dated December 31, 2018 and if the invoice mentions the name of the consignor, the consignor shall be deemed to be the owner.
The order dated November 6, 2024 is illegal and unjustified, and accordingly, the same is quashed and set-aside with a direction upon the authorities to pass an order under Section 129(1)(a) and thereafter release the goods and vehicle upon payment of the penalty in accordance with law.
The writ petition is disposed of.
-
2024 (11) TMI 1169
Denial of the input tax claim - Interpretation of Section 16(5) of the CGST Act regarding input tax credit - Circular issued by the Government of India bearing No. 237/31/2024-GST dated 15th October, 2024 - HELD THAT:- By virtue of the above provision and the directions issued by the Central Government, the petitioner would be entitled to file a rectification application for consideration of the claim of input tax credit made in the return filed; if it has been so made in the returns filed as indicated from the demand-cum-show cause notice.
The petitioner would be entitled to file such rectification application within the time stipulated in the circular, which shall be considered in terms of the newly incorporated provisions under Section 16(5) of the CGST Act and the Circular of the Central Government.
The writ petition stands disposed of.
-
2024 (11) TMI 1168
Seeking reimbursement of extra GST paid at 6% from 01.01.2022 to 30.09.2022 - grievance of the petitioner is that despite the aforesaid enhancement from 01.01.2022, the respondents are paying the running bills with 12% GST and the petitioner is paying 18% GST - HELD THAT:- Respondent No.4 which is a State GST Department, according to which also the rate of GST has been enhanced from 12% to 18% and same is liable to be paid by respondent No.2 which is a Government Entity.
The respondent No.2 is directed to pay the difference of GST amount to the petitioner @ 6% from 01.01.2022 to 30.09.2022 with a period of three months from the date of receipt of certified copy of this order, failing which the petitioner shall be entitled for interest @ 6% per annum from the date of entitlement.
Petition disposed off.
-
2024 (11) TMI 1167
Challenge to order of demand has been raised against the present petitioner - petitioner was denied opportunity of hearing - violation of principles of natural justice - HELD THAT:- The view taken by the coordinate bench in BHARAT MINT AND ALLIED CHEMICALS VERSUS COMMISSIONER COMMERCIAL TAX AND 2 OTHERS [2022 (3) TMI 492 - ALLAHABAD HIGH COURT] agreed upon. Once it has been laid down by way of a principle of law that a person/assessee is not required to request for "opportunity of personal hearing" and it remained mandatory upon the Assessing Authority to afford such opportunity before passing an adverse order, the fact that the petitioner may have signified 'No' in the column meant to mark the assessee's choice to avail personal hearing, would bear no legal consequence.
Even otherwise in the context of an assessment order creating heavy civil liability, observing such minimal opportunity of hearing is a must. Principle of natural justice would commend to this Court to bind the authorities to always ensure to provide such opportunity of hearing. It has to be ensured that such opportunity is granted in real terms. The stand of the assessee may remain unclear unless minimal opportunity of hearing is first granted. Only thereafter, the explanation furnished may be rejected and demand created.
Not only such opportunity would ensure observance of rules of natural of justice but it would allow the authority to pass appropriate and reasoned order as may serve the interest of justice and allow a better appreciation to arise at the next/appeal stage, if required.
The impugned order dated December 21, 2023 is set aside. The matter is remitted to the respondent no.2/Commercial/State Tax Officer, Sector-16, Lakhanpur, kanpur-II, Kanpur Nagar to issue a fresh notice to the petitioner within a period of two weeks from today - petition allowed by way of remand.
-
2024 (11) TMI 1166
Wrongful availment of CENVAT Credit - Seeking refund the excess utilization of ITC along with penalty - petitioner submits that the impugned order is only a copy-paste of the reply given by the petitioner to the show cause notice and the explanation provided therein has not been considered in a reasonable manner - violation of principles of natural justice - principles of audi alteram partem - HELD THAT:- The Apex Court in Mrs. Maneka Gandhi v. Union of India and another [1978 (1) TMI 161 - SUPREME COURT] laid down the ratio in relation to the principles of audi alteram partem in the doctrine of natural justice holding that 'The court must make every effort to salvage this cardinal rule to the maximum extent permissible in a given case. It must not be forgotten that “natural justice is pragmatically flexible and is amenable to capsulation under the compulsive pressure of circumstances”. The audi alteram partem rule is not cast in a rigid mould and judicial decisions establish that it may suffer situational modifications. The core of it must, however, remain, namely, that the person affected must have a reasonable opportunity of being heard and the hearing must be a genuine hearing and not an empty public relations exercise.'
Coming to the present writ petition in hand, three factors may be highlighted by this Court. Firstly, the impugned order merely copies the reply provided by the petitioner which leads to a conclusion that there was non application of mind by the respondent authority - Secondly, in the reply to the show cause notice, certain documents and reports were sought for by the assessee, which had been relied upon by the authorities. However, without providing the same to the assessee, the authorities proceeded to impose the tax liability and penalty - Thirdly, the explanation provided by the petitioner with regard to the use of the raw materials in the process of the manufacture by the petitioner supported with opinions of the experts were simply brushed aside by the respondent authority, who did not even examine whether the said raw materials had been used in manufacture of the final products which were fabrics - Without having done so and without granting an opportunity of fair hearing to the petitioner, the liability that has been imposed upon the petitioner appears to be patently illegal and without any authority in law.
Thus, non production of certain documents to the petitioner that were relied upon by the authorities, coupled with the manner in which no proper opportunity of hearing was granted to the petitioner leads us to the conclusion that severe prejudice has been caused to the petitioner. Ergo, the impugned order cannot be sustained and is liable to be quashed and set aside.
The impugned order dated September 12, 2024 is quashed and set aside with a direction upon the respondent authorities to examine the fabrics, provide a copy of the report to the petitioner, grant an opportunity of hearing to the petitioner and thereafter pass a reasoned order in the same - Petition allowed.
-
2024 (11) TMI 1165
Validity of Reopening of assessment u/s 147 - no Valid approval u/s 151 - as argued notice issued u/s 148 was wholly without jurisdiction as it does not meet the pre-requisite conditions stipulated under the amended scheme of reassessment - also approval granted u/s 151 by the specified authority reflects non application of mind - delay filling SLP
As decided by HC [2023 (8) TMI 519 - BOMBAY HIGH COURT] AS considered the approval u/s 151 we are satisfied that there is no valid sanction. There is no evidence that PCIT has even granted any valid sanction.
HELD THAT:- There is a delay of 351 days in filing the Special Leave Petition which has not been satisfactorily explained. Even otherwise, we have gone through the Special Leave Petition and do not find any merit in the same.
Special Leave Petition is, therefore, dismissed on the ground of delay as well as on merits.
-
2024 (11) TMI 1164
Transfer pricing adjustment - international transaction between WOIL and its AE involving the AMP expenses within the meaning of Section 92B or not? - As decided by HC [2015 (12) TMI 1188 - DELHI HIGH COURT] Revenue has been unable to demonstrate by some tangible material that there is an international transaction involving AMP expenses between WOIL and Whirlpool USA. In the absence of that first step, the question of determining the ALP of such a transaction does not arise.
HELD THAT:- We are not inclined to entertain the Special Leave Petitions under Article 136 of the Constitution of India.
Special Leave Petitions are accordingly dismissed.
-
2024 (11) TMI 1163
Nature of loss - Loss sustained by the appellant on account of moneys deposited in Krishi Bank being lost due to liquidation of the Bank - trading loss or business loss u/s 28 or in the alternative bad debt under Section 36(i)(vii) - HELD THAT:- None of cases/judgment relied upon are applicable to the present facts and circumstances of the case on the ground that the deposits made by the assessee were in the nature of fixed deposit investments - As the loss suffered by the assessee when the bank went to liquidation is only a capital loss. Hence, the claim of the assessee cannot be treated as bad debt or trading loss.
It is pertinent to mention that the Assessing Officer after going through the evidence has specifically gave a finding that the loss suffered by the assessee is only capital loss and the same was confirmed by the appellate authority as well as tribunal. The said finding of the fact cannot be adjudicated in the appeal, while exercising the powers conferred under Section 260A of the Act, as the scope of the appeal is very limited.
Substantial question of law is answered against the assessee in favour of revenue.
-
2024 (11) TMI 1162
Validity of assessment proceedings against company merged/amalgamating company/non existent company - Limitation period for issuing notice u/s 148 - denial of principles of natural justice due to lack of opportunity for hearing - HELD THAT:- AO could not have assumed jurisdiction under sections 147/148/148A of the Act on the ground that the amalgamating company was required to file a return of income for the assessment year 2018-19 and that income had escaped assessment because of the failure on the part of the amalgamating company to file such return.
The amalgamating company stood dissolved on March 30, 2018 and was not required to and could not have filed any return for the assessment year 2018- 19. Accordingly, only the amalgamated company was required to file any return for the said assessment year which it duly filed upon amalgamation. In fact, the consolidated accounts of both the amalgamated company and the amalgamating company had been duly filed and was also assessed under section 143(3) of the Act. In such circumstances, the Assessing Officer had erroneously assumed jurisdiction under sections 147/148/148A on the allegation that income chargeable to tax had escaped assessment for the assessment year 2018-19 because the amalgamating company had not filed its return for the said assessment year.
As a pre-condition to invoke jurisdiction u/s 147/148/148A of the Act, the Assessing Officer had to initiate a case that the items of income and expenses mentioned in the annexure to the notice u/s 148A(b) had not been incorporated in the consolidated accounts of the amalgamated company nor had the same been taken into consideration in preparing the income tax return of the amalgamated company for the assessment year 2018-19 resulting in income chargeable to tax in the hands of the amalgamated company escaping assessment. As such, the pre-conditions for invoking jurisdiction to initiate the impugned proceedings are significantly absent in the facts of this case and vitiate the entire proceedings and all the actions taken by the respondent authorities.
Period of limitation - grant of opportunity of being heard by service of a notice to show cause - In any event, no opportunity of hearing was granted to the petitioners despite requests. It was incumbent upon the Assessing Officer to grant an effective hearing to the assessee before passing the order under section 148A(d) of the Act. Consequently, there has been a violation of the principles of natural justice in the manner in which the impugned proceedings have been conducted.
Section 148A(b) provides for grant of opportunity of being heard by service of a notice to show cause provided a cause is cited within the time specified in the notice, which may vary from a minimum of seven days to a maximum thirty days from the date of issuance of the notice. Such time fixed by the notice can be extended on the basis of an application by the assessee. Although the impugned proceedings were initiated on March 23, 2022 by issuance of the notice under section 148A(b) whereby the petitioner was granted seven days to respond, i.e., by March 30, 2022. Nevertheless, the petitioner showed cause and requested for a personal hearing without filing a separate extension application. In view of the above, the contention of the Assessing Officer that he was not required by law to grant any personal hearing or any extension of time beyond the time fixed by the notice under section 148A(b) is without basis and untenable.
23. The Assessing Officer had seven days from 31 March 2022 i.e., upto 6 April 2022 to issue the notice under section 148. By the letter dated April 7, 2022, the Assessing Officer sought to make out as if the petitioner had asked for details even though the petitioner had not. The Assessing Officer suo moto sought to provide "details" and extend the time to respond by twelve days to April 19, 2022 even though there was no extension application by the petitioner. As such, it was not open to the Assessing Officer to extend the statutory period of limitation in such a circuitous manner. Accordingly, the extension was without the authority of law. In view of the above, the notice under section 148 issued on 19 April 2022, where the last date was 6 April 2022, is also ex facie barred by limitation.
The impugned proceedings have been conducted in a grossly arbitrary and unreasonable manner and in excess of jurisdiction.
AO passed the impugned order under section 148A(b) in undue haste and issued the impugned notice under section 148 on the same day without waiting for or going through the assessee's response. This is also in violation of the principles of natural justice. Decided in favour of assessee.
-
2024 (11) TMI 1161
Disallowance of deduction u/s 80IC on interest - interest earned on this share capital was treated as income - HELD THAT:- Interest so earned was used for capital expenses as mandated by the Ministry of Ayush, New Delhi and whole of the interest earned was later on converted as Share Capital Contribution of the Central Government as per letter dated 18.01.2016 issued by the Ministry of Ayush, Government of India, New Delhi. The interest on time deposits was treated as share capital infusion and that permission to issue share against interest was accorded by the Ministry.
Assessee had made fixed deposit and earned interest which belonged to Central Government of India and was utilized as capital receipt with the prior approval of the Central Government. So, it is a glaring fact that the Central Government of India had an overriding title over the interest on FDR made from capital. Therefore, the interest earned on FDR was not part of income of the appellant.
CIT(A) has relied on interest having been shown by assessee as income from other sources. As per ratio of judgment in Kedarnath Jute Mfg Co. Ltd Vs Commissioner of Income Tax (Central), Calcutta’s case [1971 (8) TMI 10 - SUPREME COURT] it is well settled that the entries made in books of accounts are not relevant for computing total income.
CIT(A) relied on ratio of judgment CIT vs Pandian Chemicals Limited’s case [1997 (4) TMI 38 - MADRAS HIGH COURT] relating to interest earned on own free deposits by the company which was not in the present case. Therefore reliance on judgment in Commissioner of Income Tax vs Pandian Chemicals Limited [1997 (4) TMI 38 - MADRAS HIGH COURT] was not proper. In view of above material facts and well settled principles of law the impugned orders are not sustainable and are set aside. Appeal filed by the assessee is allowed.
-
2024 (11) TMI 1160
Jurisdiction of AO, Surat in issuing notice u/s 148A - assessee is a non-resident Indian and it admits of no doubt in the assessment order as well as in the return of income address of the assessee is of Bokaro (Jharkhand) - HELD THAT:- As relying on Cosmet Traders Pvt. Ltd [2022 (11) TMI 895 - CALCUTTA HIGH COURT] we are in this view that notice issued u/s 148A of the Act by ld. AO, Surat cannot be said to be a valid notice as ITO, Surat has no jurisdiction to issue any notice. accordingly, on this legal issue, the case of the assessee is hereby allowed and the order passed subsequent to the notice is also hereby set aside. Decided in favour of assessee.
-
2024 (11) TMI 1159
Dismissal of the appeal by the CIT(Appeals) for non-prosecution - validity of assessment u/s 147 r.w.s.144B - HELD THAT:- CIT(Appeals) had disposed off the appeal for non-prosecution and had failed to apply his mind to the issue which did arise from the impugned order and was assailed by the assessee before him.
Unable to persuade to accept the manner in which the appeal of the assessee has been disposed off by the CIT(Appeals). Once an appeal is preferred before the CIT(Appeals), it becomes obligatory on his part to dispose off the same on merit and it is not open for him to summarily dismiss the appeal on account of non-prosecution of the same by the assessee. In fact, a perusal of Sec.251(1)(a) and (b), as well as the “Explanation” to Sec.251(2) of the Act reveals that the CIT(Appeals) remains under a statutory obligation to apply his mind to all the issues which arises from the impugned order before him. As per the mandate of law the CIT(Appeals) is not vested with any power to summarily dismiss the appeal for non-prosecution - See PREMKUMAR ARJUNDAS LUTHRA (HUF) [2016 (5) TMI 290 - BOMBAY HIGH COURT]
Unable to persuade to subscribe to the dismissal of the appeal by the CIT(Appeals) for non-prosecution, therefore, set-aside his order with a direction to dispose off the same on merits.
............
|
9911796707
