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Showing 1 to 20 of 1652 Records
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2024 (10) TMI 1652
Reopening of assessment beyond a period of three years - Mandation to get approval of the specified authority u/s. 151 of the new law - HELD THAT:- As in the present case before us for A.Y. 2017-18, wherein notice u/s. 148 of the Act was issued on 30.06.2022, i.e. beyond a period of three years from the end of the assessment year, the A.O. was statutorily obligated to have obtained the approval from either of the authorities specified u/s. 151(ii) of the extant law, viz. Principal Chief Commissioner or Principal Director General or where there is no Principal Chief Commissioner or Principal Director General, Chief Commissioner or Director General.
However, as the A.O. had obtained the approval from the Pr. Commissioner of Income Tax, i.e. an authority who was not vested with any jurisdiction as per the mandate of Section 151 of the Act (as made available on the statute w.e.f 01.04.2021), therefore, the assessment so framed by him u/s. 147 r.w.s. 144 r.w.s. 144B being devoid and bereft of valid assumption of jurisdiction is liable to be quashed. Accordingly, we quash the assessment framed by the A.O u/s. 147 r.w.s. 144 r.w.s. 144B of the Act - Decided in favour of assessee.
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2024 (10) TMI 1651
Rejecting the books of accounts and making trading addition - CIT(A) reducing the G.P. rate to 3% - HELD THAT:- It was not justified on the part of the AO to observe that the assessee has nothing to say on the query raised to hold that books of account are not reliable. It appears that before the CIT(A) all these aspects were brought on record.
CIT(A) preferred to sustain the observations of the AO with very general observation and showing generosity gave relief to the assessee by reducing the GP rate from 4% as considered by the AO to 3% in those years in which GP rate is not already shown above three years.
It seems to be more an act of benevolence rather than an exercise of quasi judicial function. Such ad-hocism has no place in law when otherwise assessee had provided all the relevant pieces of financials and records.
Tax authorities seems to have taken a short cut of rejecting the books of accounts instead of showing due indulgence to the material before them and point specific instances of misreporting income or expenses in the books.
Thus, we are of the considered view that at one end the AO has failed to justify the rejection of books of account and on the other hand, the CIT(A) has failed to consider the relevant pleas of the assessee and to make an ad hoc assessment. Assessee appeal allowed.
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2024 (10) TMI 1650
Levy of surcharge - where the income is less than Rs. 5,00,00,000/- then rate of surcharge would be 25% OR 37% as per Finance Act, 2021 - HELD THAT:- As decided in Anant Bajaj Trust [2024 (8) TMI 1551 - ITAT MUMBAI] has analyzed the factual aspects as well as relevant provisions of law and ultimately affirmed the levy of surcharge @ 37% where the MMR was applicable. Decided against assessee.
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2024 (10) TMI 1649
Validity of reopening of assessment u/s 147 - absence of any response from the appellant - HELD THAT:- It appears from the show cause notice issued on 28.03.2022 that at the bottom of the page it was digitally signed thereby giving date 29.03.2022 at 00:20:37 IST.
We further find that in the show cause notice the assessee has been directed to furnish explanation on or before 29.03.2022. It is surprising that when it was issued on 29.03.2022 at 00:20:37 IST and directed the assessee to explain the explanation before 29.03.2022.
We find substance in the argument of the CIT(A) that assumption of jurisdiction prior to 29.03.2022 by the AO is to be held to be without jurisdiction. Accordingly, the assessment order, passed, is to be deemed without jurisdiction.
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2024 (10) TMI 1648
Deduction claimed u/s 80G - contributions made by a company towards Corporate Social Responsibility (CSR) - HELD THAT:- We find that an identical issue came up for consideration in the case of Credit Suisse Services (India) Private Limited [2024 (5) TMI 1542 - ITAT PUNE] wherein the Tribunal dismissed the appeal of the Revenue relying on the decision of Allegi Services (India) Pvt. Ltd. [2020 (5) TMI 378 - ITAT BANGALORE] wherein it was held that the assessee is entitled to claim deduction u/s 80G with respect to donations forming part of CSR expenses. Appeal of assessee is allowed.
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2024 (10) TMI 1647
Levy of service tax on the amount collected as liquidated damages - HELD THAT:- The issue as to whether the service tax can be demanded on liquidated damages has been settled by a division bench of this Tribunal in Madhya Pradesh Poorva Kshetra Vidyut Vitran Co. Ltd. [2021 (2) TMI 155 - CESTAT NEW DELHI] and it has been held that liquidated damages cannot be subjected to levy of service tax.
The impugned order to the extent it confirms the demand of service tax on liquidated damages deserves to be set aside and is set aside. The appeal is, accordingly, allowed.
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2024 (10) TMI 1646
Penalty u/s 270A - as argued revenuE not specified corresponding limbs in section 270A(9)(a) to (f) whilst concluding that these are the instances of under-reporting of income as a consequence to misreporting thereof - HELD THAT:- DR could hardly dispute the fact that the AO’s corresponding show cause notices as well as penalty orders in both these cases have not specified the relevant limb u/s. 270A(a) to (f) in very terms. We thus delete the impugned penalty in both these assessees cases therefore on the very analogy. Assessee appeal allowed.
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2024 (10) TMI 1645
Dishonour of Cheque - legally enforceable debt or not - rebuttal of presumption under Sections 118 and 139 of NI Act by probable defence - HELD THAT:- From the order impugned, it is clear that though the contention of the petitioners was that the said amounts were given for producing a film and were not by way of return of any loan taken, which may have been a probable defence for the petitioners in the case, but rightly, the High Court has taken the view that evidence had to be adduced on this point which has not been done by the petitioners. Pausing here, the Court would only comment that the reasoning of the High Court as well as the First Appellate Court and Trial Court on this issue is sound. Just by taking a counter-stand to raise a probable defence would not shift the onus on the complainant in such a case for the plea of defence has to be buttressed by evidence, either oral or documentary, which in the present cases, has not been done. Moreover, even if it is presumed that the complainant had not proved the source of the money given to the petitioners by way of loan by producing statement of accounts and/or Income Tax Returns, the same ipso facto, would not negate such claim for the reason that the cheques having being issued and signed by the petitioners has not been denied, and no evidence has been led to show that the respondent lacked capacity to provide the amount(s) in question.
The High Court has also rightly observed that even assuming the petitioners and the complainant engaged together in film production and were in the course of jointly producing a film, the fact that the transaction occurred as a joint investment has not been substantiated by the petitioners before the Courts. In this background, the onus to first prove as to how the amount that is said to have been given by the complainant to the petitioners could have been given, would not be fatal as receipt of the amount(s) has not been denied, much less disputed by the petitioners. In this regard, specifically, a suggestion given to the GPA-holder of the complainant i.e., PW1 that the complainant and petitioners were engaged in film production has been emphatically denied by PW1.
Conclusion - There are no error in the High Court opining that in the backdrop of emphatic denial by PW1 with regard to any joint deal/venture with the petitioners in film production and acceptance and non-rebuttal of receipt of Rs.41,28,000/-, the onus would not shift on the complainant and would remain on the petitioners to prove that such receipt of money was not with regard to repayment of an amount legally due to the complainant. In fact, the accused have not been able to dislodge the statutory presumption under Section 139 of the Act.
Petition dismissed.
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2024 (10) TMI 1644
Deduction u/s 80P - assessee has not filed its return of income within the due date prescribed u/s 139(1) - HELD THAT:- The issue is no longer res integra. As decidedin the case of Nileshwar Range Kallu Chethu Vyavasaya Thozhilali Sahakarana Sangham. [2023 (3) TMI 1055 - KERALA HIGH COURT] has decided the issue in favour of the Revenue.
On identical facts, the Bangalore Bench of the Tribunal in the case of Madhu Souharda Pathina Sahakari Niyamitha [2024 (1) TMI 1452 - ITAT BANGALORE] by following the judgment of Nileshwar Range Kallu Chethu Vyavasaya Thozhilali Sahakarana Sangham [supra] has decided the issue in favour of the Revenue.
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2024 (10) TMI 1643
Maintainability of appeal on low tax effect - HELD THAT:- As Assessee has submitted that all these appeals would stand covered by a circular issued by the CBDT dated 17 September 2024, considering the tax effect. We accept such statement as made on behalf of the assessee.
As the tax involved in these appeals for the assessment year 2005-06, 2006-07, 2007-08 and 2008-09, we dispose of these appeals with liberty to the revenue to revive the proceedings, in the event, it is revealed that they are not covered by the circular dated 17 September 2024. Liberty to apply.
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2024 (10) TMI 1642
Adjustment made in the intimation u/s 143(1)(a) - doctrine of merger - contention of the assessee that the intimation u/s 143(1) was merged in the order u/s 143(3) and, therefore, the additions made in the intimation should have been deleted by the CIT(A), which has not been done - HELD THAT:- The doctrine of merger is a common law doctrine that is rooted in the idea of maintenance of the decorum of hierarchy of courts and tribunals, the doctrine is based on the simple reasoning that there cannot be, at the same time, more than one operative order governing the same subject matter as held in the case of Gojer Bros. (P) Ltd. v. Ratan Lal Singh [1974 (5) TMI 115 - SUPREME COURT]
Since, in the instant case, the addition made in the intimation u/s 143(1)(a) by the CPC have not been reversed by the Ld. AO in the order u/s 143(3) passed subsequently and the income as per the intimation has only been retained, therefore, the doctrine of merger does not apply.
AO has accepted the returned income, thereby implying that no addition was made on account of the reasons for which the case was selected under scrutiny but the adjustment made to the income vide intimation issued by the CPC had been retained. Hence, all the grounds of appeal in this regard are dismissed and the appeal of the assessee is liable to be dismissed. The assessee may pursue the other modes of relief in respect of the addition made in the intimation under section 143(1)(a) of the Act.
Retention of the addition made in the intimation u/s 143(1)(a) -Since both the rectification as well as the appeal proceedings are pending, therefore, there does not arise any occasion for adjudication on the issue in this appeal against the scrutiny assessment order and the appeal is hereby dismissed and all other grounds of appeal are dismissed.
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2024 (10) TMI 1641
TP upward adjustment - delayed recovery of the trade receivables from the associated enterprises - TPO during the proceedings found that there was a delay in the recovery of trade receivable form the associated enterprises, which represents the international transaction and accordingly he made the upward adjustment - TPO, while bench marking the impugned international transaction had adopted the SBN/short term deposit interest rate.
HELD THAT:- The issue on hand needs to be revisited at the level of the TPO so as to find out whether the trade receivables are outstanding more than 90 days if yes, only such trade receivables will be made subject to the adjustment on account of interest up to the end of the financial year in dispute. TPO is also directed to bench mark such transactions at Libor and 200 base points as held by the ITAT in the case of Hewlett Packard India Software Operations Pvt. Ltd. [2022 (11) TMI 1017 - ITAT BANGALORE]
Ground of appeal of the assessee is hereby partly allowed for statistical purposes.
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2024 (10) TMI 1640
Money Laundering - proceeds of crime - prima facie evidence against the applicant indicating involvement in money laundering activities under Sections 3 and 4 of the PMLA - twin conditions u/s 45 of the Prevention of Money Laundering Act, 2002 (PMLA) - HELD THAT:- The Hon’ble Supreme Court in the matter of Vijay Madanlal Chaudhary case [2022 (7) TMI 1316 - SUPREME COURT (LB)] has observed that 'The Court will not weigh the evidence to find the guilt of the accused which is, of course, the work of Trial Court. The Court is only required to place its view based on probability on the basis of reasonable material collected during the investigation and the said view will not be taken into consideration by the Trial Court in recording its finding of the guilt or acquittal during trial which is based on the evidence adduced during the trial.'
In the case of Satish Jaggi Vs. State of Chhattisgarh, [2007 (4) TMI 775 - SUPREME COURT], the Hon’ble Supreme Court has held that “at the stage of granting of bail, the Court can only go into the question of prima facie case established for granting bail, it cannot go into the question of credibility and reliability of witnesses put up by the prosecution. The question of credibility and reliability of prosecution witnesses can only be tested during trial.”
The requirement of Section 19 of the PMLA, 2002 is completely satisfied. In criminal activity of using the benami bank accounts and utilizing them for managing the proceeds of crime belonging to Mahadev Online Book is the proceeds of crime as defined under Section 2(1)(u) of the PMLA, 2002. The material collected during the investigation and the statements recorded under Section 50 of the PMLA, 2002 clearly establish the link of the present applicant with the alleged offence.
From the material produced in the present case, it is not acceptable that the present applicant did not know about the transactions that the amount utilized by him in purchasing the assets comes from Mahadev Online Book. Denial by the accused itself is not sufficient to consider prima facie that there is no mens rea of the applicant for the said offence under the PMLA, 2002. Although the statement recorded under Section 50 of the PMLA, 2002 is required to be tested at the time of trial, for the purpose of consideration of bail application the statement recorded under Section 50 of the PMLA, 2002 can be considered against the applicant.
It cannot be said that there is no involvement of the applicant in the offence in question. Considering the role of the applicant in the ensuing money laundering case of proceeds of crime in the Mahadev Book App, it is found that there is sufficient evidence collected by the ED/respondent to prima facie show the involvement of the applicant in the offence of money laundering as defined under Section 3 of the PMLA, 2002. It is an organized crime having various facets of its complexion, therefore, further considering the provisions of Section 45 of the PMLA, 2002 this Court is satisfied that there is reasonable ground for believing that the applicant is involved in the offence and he is likely to commit any other offence while on bail, it is not inclined to release the applicant on bail.
Conclusion - There is sufficient prima facie evidence against the applicant to justify denying bail. The court found that the applicant's arrest and remand were conducted in accordance with legal provisions and that the evidence presented by the ED supported the allegations of money laundering.
The present bail application filed by the applicant is rejected.
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2024 (10) TMI 1639
Addition u/s. 68 - unexplained entries in bank account - assessee has failed to produce any concrete - CIT(A) deleted the addition - HELD THAT:- As the protective additions are made in the hands of the assessee in all the three assessment years under consideration.
Assessee company being a conduit company, addition was made on protective basis by the AO by observing that the assessee has acted as conduit company for providing accommodation entries to the beneficiaries - Since the addition was made on protective basis and the addition was made substantive basis in the hands of beneficiaries, we observed that ld. CIT (A) has deleted the same correctly as it is a fact on record that assessee has acted only as a conduit entity. Accordingly, the ground raised by the Revenue is dismissed.
Commission income which was made on substantive basis in the hands of the assessee, however it is brought to our notice that Anand Kumar Jain who is the provider of accommodation entries, who is the main person, has established these dummy and conduit entities and he has earned the commission income and the same was offered to tax and also confirmed in the case of Anand Kumar Jain [2023 (5) TMI 1186 - ITAT DELHI] therefore, the same income cannot be subject to tax twice. Therefore, even on the issue of commission, we are not inclined to disturb the findings of the ld. CIT (A). Accordingly, this ground of appeal is also dismissed.
Decided in favour of assessee.
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2024 (10) TMI 1638
Addition of cash deposits - unexplained money u/s.69A - cash deposited in bank during demonetization period in Specified Bank Notes (SBNs) - HELD THAT:- When demonetization was announced there was a scarcity of Quid cash in non-demonetised currencies. Smaller traders had to accept payments from their customers in demonetised and non-demonetised currencies as well because of the fact that non acceptance will lead to fall in sales and put their customers into hardship. The traders in turn started making payments in demonetised currencies to assessee which forced them to accept in order to maintain a smooth working capital cycle. Assessee also enquired with their bankers regarding the same, who in turn advised that they will be accepting payments up to 30th December, 2016. Based on this, assessee was under the bonafide belief that acceptance of cash in demonetised form from identifiable customers is permitted and therefore assessee were accepting from such customers for a few days.
As soon as assessee came to know that only specified persons can accept demonetised currency they stopped receiving the same. The amount received during the initial few days were remitted to the bank account. This was the reason for acceptance of the demonetized currency from their customers, which were remitted in to account then and there.
Going by the explanation of the assessee that the cash deposited in SBNs during demonetization period is out of sale proceeds and this issue stands covered in favour of the assessee by the decision of Tamil Nadu State Marketing Corporation Ltd.[2024 (10) TMI 1614 - ITAT CHENNAI] as held to bring any amount u/s. 69 or 69A of the Act, the nature and source of investment, needs to be examined. In case the assessee explains the nature and source of investment, then the question of making addition towards unexplained investment u/s. 69 of the Act does not arise. In this case, the source of deposits has not been disputed and has been created out of ordinary business sales which has been credited into books of accounts and profits has also been duly included in the return of income filed in relevant assessment year. Therefore, we are of the considered view that, additions cannot be made u/s. 69 - Decided in favour of assessee.
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2024 (10) TMI 1637
Unexplained money u/s.69A - unexplained cash deposits - claim of the assessee that the cash deposits in his bank accounts were sourced out of the cash withdrawals made during the demonetization period - HELD THAT:- As it is a matter of fact borne from record that the assessee had during the pre-demonetisation period in September, 2016 i.e. immediately prior to announcement of the demonetisation policy by the government, therein made cash withdrawals from his bank account, the availability of which with him to source the cash deposits in SBNs during the demonetization period had not been disproved/dislodged by the department, therefore, we are unable to persuade ourselves to subscribe to the aforesaid observation, based on which, the A.O had, inter alia, rejected the assessee’s explanation as regards the source of subject cash deposits in his bank accounts.
We are of a firm conviction that as the A.O had failed to place on record any material which would prove to the hilt that the amount of cash withdrawals of Rs.78.80 lacs (out of cash withdrawals of Rs.98.80 lacs) made by the assessee during the pre-demonetisation period, i.e. in September, 2016 was thereafter invested/utilized by the assessee somewhere else and, thus was not available with him to source the cash deposits in SBNs in his bank accounts during the demonetization period, therefore, there could have been no justification on his part to have held the cash deposits as the assessee’s unexplained money u/s. 69A of the Act. Accordingly, we herein vacate the addition made/sustained by the lower authorities. Appeal of the assessee is allowed
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2024 (10) TMI 1636
Seeking grant of regular bail u/s 483 of the Bhartiya Nagrik Suraksha Sanhita, 2023, read with Section 45 of the Prevention of Money Laundering Act (PMLA) - predicate offence - applicability and interpretation of Section 45 of the PMLA - HELD THAT:- In the present case, the predicate offence has been registered against the applicant by ACB/EOW, Raipur Chhattisgarh under 120-B, 420,467,468,471 of IPC and Section 7 & 12 of the Prevention of Corruption Act which are schedule offences included in Paragraphs 1 & 8 of Part-A of the Schedule to PMLA, 2002 as defined under Section 2(1)(y) of the Act. The predicate offence FIR; documents including the statements recorded u/s. 50 of PMLA, 2002 shared by Mr. Thandi Lal Meena, Assistant Director, Prosecution Complaint filed by the IT and the date shared by the Income Tax Department were analyzed by the ED. From the statements of the witnesses who had reaffirmed their statements given in the earlier ECIR 11 it has come into fact that a well planned systematic conspiracy was executed by the syndicate to earn illegal commission in the sale and licensing of liquor in the State of Chhattisgarh.
From the investigation by the ED it has been revealed that CSMCL was used by the syndicate to enforce a parallel excise department which comprises of senior bureaucrats of State, politicians and officials of Excise Department. The applicant was leading the CSMCL and was the MD of the organization. It has been further revealed that the applicant was assigned with the task of maximizing the bribe commission collected on liquor procured by M/s. CSMCL and for making necessary arrangement for sale of non duty paid liquor in the CSMCL run shops.
In the instant case, after investigation by the ED, it has come to notice that the placement of the applicant as the head of M/s. CSMCL and Special Secretary in State Excise Department being an influential person and close to senior bureaucrats, masterminds of the present liquor syndicate earned profits. The applicants direct involvement in the commission and execution of the entire scam has been investigated wherein extortion of commission from the sale of unaccounted liquor could be attributed - The applicant is alleged to have conspired with M/s. Prizm Holography by lowering the tender conditions and ensured supply of lacs of duplicate holograms which were required to make the1liquor look real liquor.
It is the case of prosecution that a criminal syndicate comprising of high level State Government officials, private persons and political executives of the State Government were operating in the State of Chhattisgarh and collecting illegal bribe from the State Departments and State Public Sector undertakings by sale of liquor which is one of the major source of their illegal earning. In the initial investigation, it has come into account that there was massive corruption in the Excise Department of Chhattisgarh since the year 2019 - it cannot be said that no prima facie ofence whatsoever is made against the applicant. After carefully analyzing the material available on record which goes to show that there is prima facie involvement of the applicant in the crime in question and the charge sheet has been filed. Since, the allegations against the petitioner were serious nature therefore there was material to infer his involvement in serious crimes.
Conclusion - Taking into consideration the facts and circumstances of the case, and taking into account the nature and gravity of the offence, the role of the applicant herein, the manner in which he is alleged to have conspired with other co-accused persons and thereby was part of a syndicate and involved in the illegal earning by assisting in providing duplicate holograms, transferring funds to foreign lands, charged with economic offences of huge magnitude and considering the nature of charge and gravity of offence, the applicant is charged, which is extremely serious and looking to the special and stringent provision under Section 45(1) of the PMLA for grant of bail, in the considered opinion of this Court, it is not proper to order release of present applicant on regular bail.
The prayer for bail made by the applicant under Section 483 of the Bhartiya Nagrik Suraksha Sanhita, 2023 (BNSS) read with Section 45 of the PMLA, is hereby rejected.
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2024 (10) TMI 1635
Denial of benefit u/s 11 - delayed submission of Form no. 10B - as argued Form 10B filed subsequently and accordingly, same is considered as technical default which does not take away fundamental rights - HELD THAT:- Hon’ble Jurisdictional High Court by judgment ASSOCIATION OF INDIAN PANELBOARD MANUFACTURER VERSUS THE DEPUTY COMMISSIONER OF INCOME TAX [2023 (3) TMI 1374 - GUJARAT HIGH COURT] holding that w.e.f. Astt. Year 2016-17 filing of form though mandatory in nature but procedural in nature, owing amendment made in Finance Act, 2015. In the present case, however same has been filed subsequently, and therefore, the above decision of the Hon’ble jurisdictional High Court is squarely applicable.
Assessee having satisfied the requirement of the law, we set aside the impugned orders of the Revenue authorities, and allow the grounds of appeal.
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2024 (10) TMI 1634
Denying Foreign Tax Credit claimed by the assessee u/s 90 - denial for want of filing of requisite Form 67 along with return of income - HELD THAT:- We find that the issue of foreign tax credit is covered in assessee’s favor by the decision of this Tribunal in the case of ITO vs. Smt. Chengam Durga [2024 (4) TMI 1227 - ITAT CHENNAI] The bench, considering the decision of case of Duraiswamy Kumaraswamy [2023 (11) TMI 1000 - MADRAS HIGH COURT] held that filing of this form in terms of Rule 128 was only directory in nature. The rule is only for the implementation of the provisions of the act and it would always be directory in nature.
Respectfully following the same, we direct CIT(A) to grant impugned Foreign Tax Credit to the assessee after verifying Form No.67. Aappeal stand allowed for statistical purposes.
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2024 (10) TMI 1633
Valuation of Excise Duty - inclusion of notional cost of drawings and designs supplied free of cost by Maruti to the vendors in the assessable value - HELD THAT:- This issue was examined at length by this bench of the Tribunal in Denso India Private Limited versus Additional Director General (Adjudication) [2024 (3) TMI 686 - CESTAT NEW DELHI] and it has been held that 'The inevitable conclusion, therefore, that follows from the aforesaid discussion is that the notional cost of drawings and designs supplied free of cost by Maruti to the vendors cannot be included in the assessable value of the parts and components manufactured by vendors and cleared to Maruti for the purpose of payment of central excise duty.'
Conclusion - The notional cost of drawings and designs provided by Maruti cannot be included in the assessable value of parts manufactured by vendors.
For the reasons stated in Denso India Private Limited, these three appeals would have to be allowed.
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