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2018 (11) TMI 1976
Bogus LTCG - Addition u/s 68 - Referring to the investigation made by the Directorate of Investigation, Kolkata, AO formed a belief that the assessee is one of the beneficiaries of accommodation entries provided by the entry provider in the form of LTCG involving penny stock companies - no opportunity to cross-examine witnesses whose statements were used against the assessee - HELD THAT:- As examined the transaction statement of the stock broker, contract note for sale of shares, transaction and holding statement, statement of account from the broker certifying the sale of shares.
The entire addition has been made by the AO only on the basis of presumptions and surmises without pointing out any specific defect in the documentary evidences filed by the assessee.
Additions have been made by the AO on the basis of statement of one Shri Sanjay Vohra, who, in his statement, has stated that he has indulged in bogus LTCG transactions in Kolkata Stock Exchange and M.P. Stock Exchange. AO completely ignored the fact that the assessee has done transactions with BSE.
Though AO has given detailed explanation regarding the modus operandi of the bogus LTCG Scheme, but has failed to bring anything on record to show that the facts of the case fell within the purview of the same.
No hesitation to hold that the lower authorities grossly failed in bringing out any case in favour of the Revenue. Moreover, not granting opportunity to cross examine Shri Sanjay Vohra in itself is gross violation of the principles of natural justice and against the ratio laid down by the Hon'ble Supreme Court in the case of Andaman Timber [2015 (10) TMI 442 - SUPREME COURT]. Appeal of assessee allowed.
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2018 (11) TMI 1975
Assessment u/s 153A - incriminating material was found during the search or not? - HELD THAT:- Admittedly, the assessment for the year under consideration stood completed on the date of search. No incriminating material whatsoever in relation to the share application money was found. It has been time and again held by the various High Courts that if no incriminating material is found during the search action, the addition in the case of already concluded assessment cannot be made while framing assessment u/s 153A of the Act. See Continental Warehousing Corporation [2015 (5) TMI 656 - BOMBAY HIGH COURT] and Kabul Chawla [2015 (9) TMI 80 - DELHI HIGH COURT]
Additions made/confirmed by the lower authorities for one assessment year under consideration are hereby, ordered to be deleted. Appeals of the assessee are hereby allowed.
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2018 (11) TMI 1974
Estimation of income - non-genuine purchases - CIT(A) has restricted the disallowance upto 5% - HELD THAT:- We are inclined with the decision of ld.CIT(A) that the purchases have been made by the assessee but not from the parties whose invoices have been obtained. We find justification in the findings of the ld.CIT(A) that the assessee might have inflated his purchases by taking the invoices from the suppliers of the bogus bills.
It is not reasonable to treat the entire purchases as bogus and AO has not disapproved the genuineness of the corresponding sales made by the assessee. In the light of above facts and legal findings, as elaborated in the decision of ld.CIT(A), we do not find any error in the decision of CIT(A) for restricting the disallowance of 5% of the bogus purchases for assessment year 2013-14. Accordingly, the appeal of Revenue is dismissed.
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2018 (11) TMI 1971
Reopening of assessment u/s 147 - deduction u/s 80IA - HELD THAT:- We have gone through the audit report in Form No. 10CCB as well as other submissions filed by the assessee during the course of original assessment proceedings completed u/s 143(3) of the Act and find that there is no disclosure or discussion regarding the apportionment of any head office expenses while computing the deduction u/s 80IA of the Act.
As in the present case, we find that there is nothing on record at the time of completion of original assessment proceedings disclosing the said factual position on part of the assessee. The fact remains that there are expenses incurred at the head office level and there are tax holiday eligible units and non-tax holiday units/undertakings. Unless and until, the assessee makes its position clear and make a complete factual disclosure thereof, it is clearly a case of failure on part of the assessee to disclose full and truly all material facts relating to the computation of deduction u/s 80IA and in turn, for the purposes of the completion of assessment proceedings.
No infirmity in AO’s exercising his jurisdiction under section 147 of the Act by issuance of notice u/s 148 - Ground of appeal is dismissed.
Eligible profits for the purposes of section 80IA - first contention of the ld AR that none of the expenses at the Corporate office pertain to the 80IA undertakings in as much as the entire operation and maintenance of the plant has been given to Suzlon Energies Ltd. - The fact remains that the assessee activities are still guided towards overall supervision and management of these activities at the strategic and managerial level and to safeguard the interest of the shareholders and the assessee still remains responsible for the activities of these eligible undertakings to the outside world even though at the operational level, the whole of its activities have been outsourced to Suzlon Energies Ltd.
Therefore, the contention of the AR cannot be accepted that no expenses in furtherance and support of what we have stated above has been incurred by the assessee and which has no nexus with the eligible undertakings. To our mind, these activities at the strategic, managerial, regulatory and overall oversight level definitely have a nexus with the eligible undertakings and the expenses incurred in relation thereto needs to be allocated to the eligible undertakings.
Expenditure incurred at the corporate level - On perusal of the said expenditure, we find that expenditure on rates and taxes, land tax, insurance, interest on debentures, business promotion expenses and advertisement expenses cannot be said to have any nexus with the eligible undertakings engaged in generation of energy and thus, these expenses needs to be excluded.
AO has himself excludes the donations while working out the eligible deductions. The remaining expenses in the nature of employee costs and other establishment expenses etc therefore needs to be allocated in the ratio of turnover for the purposes of determining the eligible profits u/s 80IA - The matter is accordingly set-aside to the file of the AO to verify these figures and recalculate the eligible profits for the purposes of section 80IA of the Act. In the result, the ground is partly allowed for statistical purposes.
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2018 (11) TMI 1970
Appointment of petitioner - Legality of the termination orders issued against the writ petitioners - Reinstatement of the writ petitioners therein on their respective posts with all consequential benefits - HELD THAT:- It is not in dispute that the Government of Bihar in its Administrative Reforms department had issued instructions for appointment to Class III posts in the Government office under its circular No. 16440 dated 03.12.1980. The said circular applies to Class III posts other than the posts which are filled in by appointment of candidates selected by Bihar Public Service Commission after a competitive examination and to the posts which are governed by the Government resolution dated 28.01.1976 - A similar circular No. 16441 was also issued on 03.12.1980 for appointment to Class IV posts in the Muffassil Offices of the Government. These circulars had been issued to avoid discrimination in appointment to Class III and Class IV posts in the Government offices and provide for generalized procedure in consonance with Articles 14 and 16 of the Constitution. The appointment of the writ petitioners have not been made in accordance with these circulars. Therefore, the contention of the learned counsel for the writ petitioners is that since the writ petitioners have served for more than 10 years and some of them have even completed 20 years of service, they ought to have been regularized in terms of the judgment in Umadevi [2006 (4) TMI 456 - SUPREME COURT] and M.L. Kesari [2010 (8) TMI 1188 - SUPREME COURT].
In Umadevi the Constitution Bench has held that unless appointment is made in terms of the relevant rules and after a proper competition among qualified persons, the same would not confer any right on the appointee. If it is a contractual appointment, the appointment comes to an end at the end of the contract, if it was an engagement or appointment on daily wages or casual basis, the same would come to an end when it is discontinued. A temporary employee could not claim to be made permanent on the expiry of his term of appointment. It was also clarified that merely because a temporary employee or a casual wage worker is continued for a time beyond the term of his appointment, he would not be entitled to be absorbed in regular service or made permanent, merely on the strength of such continuance, if the original appointment was not made by following a due process of selection as envisaged by the relevant rules.
In State of Orissa and Anr. v. Mamata Mohanty, [2011 (2) TMI 1371 - SUPREME COURT], this Court has held that once an order of appointment itself had been bad at the time of initial appointment, it cannot be sanctified at a later stage.
In the instant cases the writ petitioners have filed the petitions before the High Court with a specific prayer to regularize their service and to set aside the order of termination of their services. They have also challenged the report submitted by the State Committee. The real controversy is whether the writ petitioners were legally and validly appointed - The writ petitioners are the beneficiaries of illegal orders made by the Civil Surgeon-cum-Chief Medical Officer. They were given notice to establish the genuineness of their appointment and to show cause. None of them could establish the genuineness or legality of their appointment before the State Committee. The State Committee on appreciation of the materials on record has opined that their appointment was illegal and void ab initio - There are no ground to disagree with the finding of the State Committee.
Appeal dismissed.
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2018 (11) TMI 1969
Direction to cause an investigation into the matter and submit an investigation report within 60 days from the receipt of the said order - allegation against the manufactures is that they were controlling the prices of the oral diabetes drugs containing the Active Pharmaceutical Ingredient (API) Vildagliptin - HELD THAT:- Upon receiving the information from any person including Central Government, State Government, Statutory Authority or on its own knowledge under Section 19 (1)(a) of the Act, the commission is expected to satisfy itself and express its opinion that a prima facie case exists and then pass a direction to the Director General to cause an investigation into the matter in terms of Section 26(1) - This direction under Section 26(1) to the Director General may be passed with or without seeking assistance from any other quarters including experts of eminence or the affected parties themselves. The aggrieved / affected parties cannot claim a right to notice or hearing at this stage.
The subject provision does not contemplate any adjudicatory action on the part of the Commission. The Commission is not expected to give notice to the parties and hear them at length. It is of a very preliminary nature.
There are no merit in the appeal, and the same is dismissed.
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2018 (11) TMI 1968
Allowance of deduction claimed u/s 80IA - whether the assessee is to be treated as an infrastructure developer or simply a contractor? - HELD THAT:- Respectfully following the decisions of the Co-ordinate Bench in the earlier assessment years viz. Asstt. Year 2005-06 to 2008-09 and applying the facts to these facts as well as the provisions of sec. 80IA sub-sec.(4) we are of view that assessee is not merely a contractor but a developer looking to the scope of activities undertaken by it for the completion of the project and, therefore, eligible for deduction u/s 80IA. We therefore, find no reason to interfere with the order of ld. CIT (A) and uphold the same. The appeal of Revenue is dismissed.
Assessment of interest income as income from other sources and upheld exclusion of these amounts from eligible profit for grant of deduction u/s 80IA -Assessee fairly admitted that in earlier years, this issue was not agitated before the Tribunal. Considering the smallness of the amount involved in all these years, the issue was not pressed by the assessee, hence these grounds are rejected in all three years. Interest income on FDR has rightly been assessed as income from other sources and rightly been excluded from eligible profit from the amount of deduction u/s 80IA. Accordingly, this issue is decided against the assessee.
Disallowance of employees contribution towards PF and ESI, which was deposited after expiry of time limit - Assessee did not dispute that the issue is covered against the assessee by the decision of Gujarat State Road Transport Corpn. [2014 (1) TMI 502 - GUJARAT HIGH COURT] wherein Hon’ble Court has held that if employee’s contribution is not being deposited within time limit prescribed in provident fund and ESI Act then deduction of such amount will not be admissible to the assessee.
Disallowance of additional depreciation - assessee has claimed additional depreciation on water treatment plant - claim of the assessee was disallowed by the AO on the ground that it is just engaged in development of infrastructure and not engaged in any manufacturing activity - assessee contended that this disallowance will increase the profit of the assessee and 80IA would be admissible to it, he did not advance much argument on the claim for additional depreciation - HELD THAT:- We allow alternate claim of the assessee and direct the AO to include this amount for eligible profit for grant of deduction under section 80IA. This ground is partly allowed.
Disallowance of claim of bad debts - assessee submitted that though security deposits for business was allowable as deduction under section 37, but even if it is disallowed, the AO be directed to consider this issue for deduction under section 80IA - HELD THAT:- Since specific arguments were not raised qua main fold of contentions, therefore, considering alternative contentions of the assessee, we remit this issue to the file of the AO for examination. AO shall adjudicate this issue with the angle whether this amount can be construed as eligible for grant of deduction under section 80IA or not. If it has live nexus and be construed as derived from infrastructure activities of the assessee, then 80IA be granted to the assessee. Our above observations will not impair or injure the case of the AO and will not cause any prejudice to the defence/explanation of the assessee. The ld.AO shall decide it in accordance with law.
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2018 (11) TMI 1967
Refund of unutilized CENVAT credit - reversing entries and suo motu credit by the assessee in relation to service tax payment - Scope of circular dated 23-8-2007 - case of Revenue is that in view of the circular as well as provisions of law, the assessee cannot be permitted to reverse the entries and in fact should have applied for refund of the amount due to him - as decided by HC [2018 (1) TMI 994 - RAJASTHAN HIGH COURT] there is no error committed by the Tribunal while holding that the amount which has already been paid in cash to satisfy the demand of the revenue with respect to the service tax on GTA is fulfilled, there was no question of not reversing the amount paid from their CENVAT credit account. Further, the circular is dated 23-8-2007 and the period in question is March, 2006 to March, 2007, therefore the Tribunal was right in holding that the circular dated 23-8-2007 is having no application.
Order passed by the Tribunal is not required to be interfered with as the revenue's demand for payment of service tax on GTA has already been done by the assessee by paying the service tax amount in cash and, therefore, the amount paid from CENVAT credit account was required to be reversed.
HELD THAT:- The Special Leave Petition is dismissed on the ground of low tax effect, leaving the question of law open.
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2018 (11) TMI 1966
CENVAT Credit - denial on the premise as per N/N. 02/14-CE (N.T.) dt. 20.1.2014, the appellant was not entitled to credit prior to the N/N. 01/10-CE dt. 6.2.2010 - HELD THAT:- It is found that similarly placed assessee was allowed the credit although against those orders, the appeals have been filed by the Revenue before the Commissioner (Appeals), in that circumstance, when the Revenue is having divergent views on the issue, the extended period of limitation is not applicable. Admittedly, in this case, the show cause notice has been issued by invoking the extended period of limitation, therefore, the denial of credit is barred by limitation.
The impugned order is set aside and the appeal is allowed.
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2018 (11) TMI 1965
Determination of profit of assessee's two units - AO computed the profits of both the units on the basis of allocation of proportionate expenditures, in the ratio of their respective turnover to the combined turnover - finding of the appellate authorities holding that the assessee has not inflated the profits from MEL (Non-EOU) and MEL (EOU) by debiting the common expenditure in the books of accounts of the non-EOU and the estimation of the profits by the AO
HELD THAT:- CIT(A) accepted the re-computation made by the AO. Tribunal affirmed the view of the CIT(A). It also came to the view that the AO has not found any defect or mistake in the books of accounts so as to justify invocation of sec 145. That, in fact, the AO having accepted the books profit as shown in respect of MEL (EOU), P & L a/c. as well as that of MEL (Non-EOU) could not have interfered with the same.
That in the absence of any defect in the books of accounts, there was no justification for determination of profits of MEL (EOU) undertaking in the ratio of turnover by aggregating the profit shown in respect of two undertakings. That activity of MEL (Non-EOU) is largely trading, whereas in the case of MEL (EOU), it is manufacturing and production. Therefore, the comparison of the financial result has to be considered likewise.
Thus, no ground to interfere in the impugned orders. The orders passed by both the authorities are just and proper. Each of the expenses allocated by the assessee has been rightly reflected in the books of accounts of both the units. Therefore, the findings recorded by the Tribunal, being just and proper, do not call for interference. Hence, the first substantial question of law is answered by holding that the findings of the appellate authorities that the assessee has not inflated the profits from MEL (Non-EOU) and MEL (EOU) by debiting the common expenditure in the books of accounts of MEL (Non-EOU) and the estimation of the profits by the AO are just and appropriate.
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2018 (11) TMI 1964
Addition u/s 68 - no plausible reply by assessee to produce the people from whom the share application money has been received and on the strength of the Inspector's report, AO came to the conclusion that the assessee grossly failed to identify the share applicants - onus to prove - HELD THAT:- We find that in response to notice served upon them u/s. 133(6) of the Act, all the share applicants have furnished their documents in the form of copy of ledger account, bank statements and copies of income tax returns. It should be kept in mind that these documents were furnished by the share applicants directly to the Assessing Officer in response to his notice. Therefore, it cannot be said that the said share applicants do not exist on the given addresses as reported by the Inspector.
A perusal of the respective bank statements, clearly shows that all the transactions are duly reflected in the bank statements of the subscriber company. It is not the case of the Assessing Officer nor it is the case of the first appellate authority, that the appellant company has purchased cheques from the subscriber company in lieu of cash. All the transactions have been done through banking channel.
Once the appellant company filed complete details before the AO then the initial onus upon the assessee company has been discharged to prove the identity of the investor. The appellant company has provided the balance sheet of the investor companies alongwith their company profiles and details with the Registrar of Companies. The subscriber companies themselves have provided the bank statements and their respective PAN details. It is not the case of the Revenue that the subscriber companies are name lenders or entry providers. Their details are available on public domain on the website of the Registrar of Companies.
The Hon'ble Supreme Court in the case of CIT v. Lovely Exports (P.) Ltd. [2008 (1) TMI 575 - SC ORDER] has laid down the ratio that the assessee has to be merely identified as the shareholder and the initial onus u/s. 68 of the Act stands discharged on mere identification.
As decided in the case of CIT v. Sophia Finance Ltd. [1993 (8) TMI 62 - DELHI HIGH COURT] the ratio that if the shareholders are identified and it is established that they have invested in the purchase of shares, then the amount received by the company would be regarded as capital received. The assessee has no further onus.
Exhibits 123 to 139 of the paper book reveal the proportion of investment made by the share applicant companies in the share capital of the appellant company. The percentage of their investment ranges from 5% to 40%, which means that the share applicant company portfolios include investment in other companies also. There is nothing on record to suggest that the other investments made by the share applicant companies have been treated as bogus in the hands of other companies.
In our considered opinion, the applicant company has successfully discharged the initial onus cast upon it by the provisions of section 68 of the Act and, therefore, no addition is called for u/s. 68 of the Act as unexplained cash credit. Decided in favour of assessee.
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2018 (11) TMI 1963
Rejection of petitioner’s application for reinstatement - validity of termination of service - HELD THAT:- From the record, it is apparent that before the Labour Court the respondents have not filed any reply to the claim of the petitioner for reinstatement nor has he been cross examined on the affidavit filed by him before the Labour Court in which he has stated that he has worked continuously from 1995 to 1999 and as such his statement of claim as well as his affidavit have remained un-rebutted. In the case of other employees, namely, Ghanshyam Sahu and Saleem, the Labour Court in identical cases has ordered for reinstatement with 50% and 70% back wages.
In the present case, the learned Presiding Officer of the Labour Court has held that the petitioner has worked continuously from 1995 to 1999, he has also not been served with any notice for the termination of his services and has also not been granted any retrenchment allowance - the Presiding Officer of the Labour Court ought to have maintained the parity in the present case also and the petitioner ought to have been granted the benefit of reinstatement.
Although the impugned order dated 28.02.2009/28.11.2008 is hereby quashed, however, since the petitioner has not shown as to whether during all these years when the case was pending he was not gainfully employed, in view of the same the question of grant of back wages does not arise. As a result, the respondents are directed to reinstate the petitioner within two months’ time subject to the condition that after his reinstatement he would return the amount of compensation, if any, which he has received from the respondents within one month's time.
Petition allowed in part.
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2018 (11) TMI 1962
Refund of education/ higher education cess - area based exemption under N/N. 56/2002-C.E., dated 14-11-2002 availed - inclusion of freight component in the transaction value - It was held by CESTAT that 'The appeals filed by the assessee-appellants contesting the eligibility for refund of education cess are allowed and the appeals regarding assessable value with inclusion of freight element are dismissed' - HELD THAT:- Appeals admitted.
Issue notice on application for stay also.
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2018 (11) TMI 1960
Maintainability of winding up petition against a foreign company - HELD THAT:- The Court finds that the fact, that, the Appellant is not a company registered in India but outside India and in respect of whom documents have been delivered to the Registrar of Companies under Section 380 of the Companies Act, 2013, was not brought to the notice of the learned Single Judge.
The Court permits the Appellant to file a review petition before the learned Single Judge within four weeks raising the above issue which if so raised would be considered by the learned Single Judge in accordance with law. Till the disposal of the review petition by the learned Single Judge, the impugned order shall be kept in abeyance.
Appeal disposed of.
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2018 (11) TMI 1959
Disallowance u/s 40(a)(ia) - interest paid to the NBFC - as argued since the recipient of interest has included the said amount in the total income and filed the return of income, therefore, in view of the second proviso to section 40(a)(ia) of the IT Act no disallowance is called for - HELD THAT:- We note that an identical issue has been considered by the Coordinate Bench of this Tribunal in the case of ACIT vs. M/s. Vastuvedik Colonizers & Developers [2017 (3) TMI 483 - ITAT JAIPUR] the second proviso to section 40(a)(ia) is curative in nature and is applicable retrospectively. Having held that the benefit of second proviso is available to the assessee if the recipient of interest has already taken this amount in its total income and filed the return of income, we direct the AO to verify this fact and decide the issue in the light of the above observations and decisions. Appeal of the assessee is partly allowed for statistical purposes.
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2018 (11) TMI 1958
Revision u/s 263 against reopening of assessment - Estimation on income on bogus purchases - HELD THAT:- We find from the records that while passing order u/s 143(3) r.w.s. 147 of the I.T. Act, the AO has considered the factual position with regard to making purchases from different persons.
From the records, we found that completed assessment was reopened on the ground of information from the investigation wing that assessee had made purchases from alleged bogus supplier. Since the reopening itself was for this purpose only the AO after having detailed inquiry and investigation found that corresponding sales have been duly accounted for in the books, accordingly entire purchases could not be added and he estimated extra profit of 6% on such purchases and added the same in assessee’s income.
We are of the considered view that order passed by Ld. CIT u/s 263 of IT. Act is not correct as Ld. CIT has not discussed the factual details passed in the order in the case of N. K. Proteins Ltd. [2017 (1) TMI 1090 - SC ORDER] and N.K. Industries [2016 (6) TMI 1139 - GUJARAT HIGH COURT], wherein in these cases, 100% of additions were made. Therefore in the case of the assessee, AO had not made 100% addition, whereas after going through the aforementioned different orders passed by different courts, had made additions @ 6%.
We have also considered the various decisions of the judicial authorities, wherein under identical facts and circumstances, 2% additions on bogus purchases were made. Since the additions in such type of case depend on the facts of each case, therefore provisions of section 263 could not have been invoked by the Ld. CIT. Decided in favour of assessee.
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2018 (11) TMI 1957
Benefit of Section 10A and 10B - Interest on fixed profit - Whether the interest received and the consideration received by sale of import entitlement is to be construed as income of the business of the undertaking? - HELD THAT:- Substantial question of law that arises for consideration in the instant appeal has been covered by the Division Bench judgment of this Court in the case of COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE VS. MOTOROLA INDIA ELECTRONICS PRIVATE LIMITED [2014 (1) TMI 1235 - KARNATAKA HIGH COURT]
The submission of the learned counsel for the appellants is placed on record. The appeal is accordingly dismissed.
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2018 (11) TMI 1956
Rejection of application for impleadment of Director of Respondent as a party - Section 424 of the Companies Act, 2013 - HELD THAT:- What comes to fore from record is that the Appellants primarily sought impleadment of Mr. Pranav Patwardhan as party respondent on the score that such appointment was illegal and documents were fabricated to file statutory compliances while other reliefs claimed were consequential. This factual position stares in the face of Appellants who cannot wriggle out of the same. Even the Memo of Appeal incorporates this factual position. The impleadment was sought on the ground that such appointment was violative of Section 161 of the Companies Act, 2013. The Tribunal took cognizance of the fact that Mr. Pranav Patwardhan had already resigned from the post of Additional Director on 16th January, 2018. The factum and validity of such resignation has not been questioned by the Appellants.
Infraction of the Articles of Association of the Company or provisions of Companies Act in this regard cannot be attributed to Mr. Pranav Patwardhan who is neither a necessary party nor a proper party for being impleaded as party respondent, more so as he has admittedly tendered resignation on 16th January, 2018 and ceased to be a member of the Board of Directors.
There being no legal infirmity in the impugned order, the appeal merits dismissal - Appeal dismissed.
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2018 (11) TMI 1955
Grant of Default bail - smuggling of contraband - presentation of report under Section 173(2) Cr.P.C. by the police without the report of Chemical examiner/Forensic Science Laboratory amounts to incomplete challan or not - absence of any extension of time under Section 36-A(4) of the N.D.P.S. Act - HELD THAT:- When a report is submitted by the police to the Magistrate, he ought to apply his mind to see whether it discloses the commission of an offence, so as to enable it to subject the accused to the rigors of a trial - What would also necessarily flow from this, would be a prima facie opinion by the Court of the commission of an offence which under the N.D.P.S. Act would revolve around establishing the posession of contraband, its nature, content and extent.
With respect to the question posed by the learned Single Judge regarding some of the contraband being identifiable through naked eye, inspection based on experience and knowledge, would be a great fallacy and we would respectfully state that it would be grossly unsafe to rely upon such an opinion based on naked eye inspection backed by experience or knowledge to arrive at a prima facie opinion of the commission of an offence to submit an accused to the rigors of trial by the Magistrate in the exercise of its powers under Section 190 Cr.P.C. - Non-inclusion of the Chemical Examiner's opinion in the report under Section 173 Cr.P.C. would expose the accused to unfounded dangers imperiling and endangering his liberty since the provisions of the N.D.P.S. Act in its applicability to a trial and conclusion are stringent in consequence.
Thus, it is essential that the report of the Chemical Examiner be included in the report under Section 173 Cr.P.C. and without which it can at best be termed to be an incomplete challan depriving the Magistrate of relevant material take cognizance and if it is not submitted within the requisite period of 180 days, it would essentially result in a default benefit to the accused unless an application is moved by the Investigating Agency apprising the Court of status of investigation with a prayer for extension of time to the satisfaction of the Court.
The State should also sensitize their Investigation Officers to make an application for extension of time to submit the report in the prescribed period so as to obviate any chances of an accused getting benefit of the default clause.
Reference disposed off - List all the cases before Single Bench appropriately as per roster.
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2018 (11) TMI 1954
Registration of petitioner firm as transporter and handler of the agricultural produce - denying the registration of the firm on account of not getting the balance-sheets audited by Income Tax Department for last three years - Non-considering the bid of the petitioner for the purpose of empanelment - Counsel submitted that the requirement of having the turnover of 1.5 Crore in last 3 financial years is fulfilled by the petitioner-firm and only on account of audit not being carried out, the respondents have acted arbitrarily in rejecting the empanelment of the petitioner-firm.
HELD THAT:- Requirement of audit of accounts is to be governed by the provisions contained in Section 44AB of the Income Tax Act, 1961 and if the turnover/sale/gross receipts in business does not exceed one crore rupees in any previous year, there is no requirement of getting the accounts audited.
This Court further finds that the requirement as per Condition No. 5 was to consider the turnover for last three years of Rs. 1.50 Crore and if the petitioner-firm had the turnover in last three years of 1.50 Crore, the same could not be related to the condition of audited balance-sheets.
The plea of the respondents that even if the turnover is less than One Crore but it exceeds to 1.50 Crore in the last three years, the same is required to be audited, this Court finds no substance in the arguments raised by counsel for the respondents, as it runs contrary to the requirement of Section 44 (A)(B) of the Income Tax Act, 1961.
This Court finds that if the procuring entity prescribes a condition to be fulfilled by the bidder, such condition had to be in consonance with the requirement of law. The Income Tax Act, 1961 has prescribed the minimum turnover for getting the accounts audited, the procuring authority cannot interprete and put such a condition to insist upon getting the accounts audited even if some assessee/businessmen who has a turnover of less than one crore in a particular year.
This Court finds little substance in the submission of the learned counsel for the respondents that the action taken by the respondents is perfectly legal and justified. The respondents while considering the bid submitted by different eligible bidders was required to consider the condition which was prescribed in the tender and also to fulfill the requirement of compliance of relevant law as well.
This Court finds that non inclusion of name of the petitioner-firm on account of not having the audited balance-sheets is not justified and respondents have committed illegality in rejecting the bid of the petitioner-firm.
Accordingly, the present writ petition succeeds and is hereby allowed. The respondents are directed to consider the bid of the petitioner for the purpose of empanelment and it should not be rejected on the ground of not having audited balance-sheets of last three years.
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9911796707
