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Showing 1 to 20 of 2131 Records
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2018 (2) TMI 2136
Maintainability of application - initiation of CIRP - Corporate Debtor qualifies as a "Financial Debt" under the Insolvency and Bankruptcy Code (IBC) or not - HELD THAT:- The nature of Debt is a "Financial Debt" as defined under section 5 (8) of the Code. It has also been established that admittedly there is a "Default" as defined under section 3 (12) of the Code on the part of the Corporate Debtor. On the basis of the evidences on record, it is noticed that the Creditor has sanctioned the loan and duly disbursed to the Debtor but there is non- payment of Debt on the part of the Debtor.
Application u/s 7 of the Code is perused and it is noticed that, this Application is complete in all respect of the Code and Rules therein. The consent form from the proposed IRP i.e. Form - 2 is perused and it is satisfied that there is no disciplinary proceeding pending against the proposed IRP.
Conclusion - Keeping admitted facts in mind that the Creditor had not received the outstanding Debt from the Debtor and when the default is admitted by the Debtor itself, it is concluded that this Petition/Application deserves 'Admission'.
Petition admitted.
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2018 (2) TMI 2135
CENVAT credit - input services - GTA Services - auction services - outdoor catering services - insurance services - rent-a-cab services - Clearing and forwarding agency service - scope of the term "up to the place of removal" - HELD THAT:- List along with Civil Appeal No. 11402/2016.
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2018 (2) TMI 2134
Compliance with Corporate Social Responsibility u/s 135 of the Companies Act, 2013 - HELD THAT:- When the grievance raised on behalf of the petitioner is tested on the anvil of the stand of Central Government, there is substantial force in the contentions on behalf of the petitioner that respondent no.3 has not carried out its statutory obligation in letter and spirit.
Collector of the Districts in the State of M.P. is directed to take stock of the situation to ascertain as to whether respective companies covered by the provisions contained under section 135 of the Companies Act, 2013 are actually discharging their responsibilities in consonance therewith on field and if it is found that no such activities are being carried out or activities are being carried out is not up to the percentage as warranted under section 135 of the Act of 2013 they are further directed to inform the same to the Registrar of the Companies for appropriate action against the respective company under the law.
Let a copy of order be sent to the Chief Secretary, Govt. of M.P. to ensure its proper implementation so that scope and object set forth with an introduction of section 135 of Companies Act 2013 is meted out to its hilt and in letter and spirit.
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2018 (2) TMI 2133
Condonation of delay - Non granting refund of excess amount deducted by the assessee at source - Held that:- If the petitioner is correct in pointing out that there has been a clear excess deduction of TDS and in depositing the Government revenue, subject to fulfillment of conditions of the scheme, petitioner must receive refund thereof. Unless the delay is gross or intentional or arising out of inaction and lethargy on the part of the petitioner, tax mistakenly deposited cannot be retained by the Government on the ground of delay.
CBDT undoubtedly has powers to condone the delay even if we assume the Commissioner does not have such powers. In the present case, the dispute is lingering since quite some time. In any case, the delay is not gross and the repercussion in law is not widespread. We may recall the last date for filing refund claim under the scheme was 31.03.2008. The petitioner upon coming to realize that excess deduction has been made and deposited with the Government, approached the appropriate authority under letter dated 15.12.2008.
Thus we propose to condone the delay here itself and then require the competent authority before whom the petitioner's application for refund is pending to decide the same on merits.
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2018 (2) TMI 2129
Reopening of assessment u/s 147 - deduction u/s 80IA - deduction on interest income (including penal interest income and other income - HELD THAT:- We note that it is not the case of earning the interest income from the surplus fund deposited in the bank or other incomes are not connected with the business activity of the assessee developing and maintaining industrial parks but the interest and penal interest received by the assessee in respect of the late payment made by the allottees.
The other incomes though it is very small amount is also in respect of the maintenance and fee for sanction of plans etc and therefore, it is apparent that on this issue there is a possibility of two views.
When the AO has allowed the claim of the assessee u/s 80IA in the original assessment claim u/s 143(3) and also not disturbing the said claim in the first reassessment order passed u/s 143(3) r.w.s. 147 of the Act then the reopening for the purpose of the disallowing the said deduction on the issue on which two views are possible is not permissible in the absence of any fresh material came to the knowledge of the AO which could lead to the formation of belief that the income chargeable to tax has escaped assessment due to excess deduction u/s 80IA of the Act allowed in the original assessment.
It is not the case of claim of deduction u/s 80IA of the Act allowed by the AO which is absolutely not permissible under the Act but the opinion of the AO in allowing the claim in the original assessment u/s 143(3) is a possible view.
Accordingly, in view of the facts that the interest and penal interest was received as part of the other Revenue earned by the assessee from the allottees and from the activity of developing, maintaining and operating the industrial parks then the case of the assessee does not fall in the category of absolute impermissible claim. Hence, the reopening based on change of opinion is not permissible under the law and the same is held as invalid. Accordingly, we set aside the reopening u/s 148 as invalid and consequently quash the reassessment framed by the AO. Decided against revenue.
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2018 (2) TMI 2128
Bogus LTCG - HELD THAT:- It is a settled position of law that suspicion alone cannot be the basis for making an addition in an assessment. Suspicion cannot take place of proof. In the instant case, we find no material could be brought on record by the Revenue to impeach the related transactions. We do not find any infirmity in the order of CIT(A). Hence, this ground of appeal of Revenue is dismissed.
Unexplained labour/wage expenses - Gross profit estimation - CIT (A) deleted the addition on the ground that books of accounts were audited u/s.44AB of the Act and bills and vouchers, wages sheets/register/muster roll etc. were produced and test checked by the AO - HELD THAT:- AO has not given any basis of his assuming that outstanding wages at the end of the year cannot be more than Rs. 10 lakhs.DR also could not, during the course of hearing, substantiate the finding of AO of his arriving at such a conclusion.
Thus in our considered opinion, the disallowance of labour and wages outstanding as at the end of the year under the head sundry creditors cannot be sustained in law. Hence, we confirm the order of CIT (A) and dismiss this ground of appeal of the Revenue.
Addition on account of interest in the profit and loss account - CIT (A) deleted the addition on the ground that the AO failed to establish any nexus between the interest bearing funds and advances given by the assessee - HELD THAT:- DR during the course of hearing supported the order of AO but could not controvert the above finding of CIT (A) by brining any cogent and positive material on record. Hence, we do not find any good and justifiable reason to interfere with the order of CIT(A), which is confirmed and this ground of appeal of Revenue is dismissed.
Disallowance of expenses on personal use of the vehicles - HELD THAT:- We find that the AO has not given the basis of working out the disallowance of Rs. 25,000/- out of the vehicle expenses of Rs. 2,53,689/- claimed by the assessee. Adhoc disallowance of any genuine business expenditure of the assessee is not permitted in law. Therefore, we find no good reason to interfere with the order of CIT(A), which is confirmed and this ground of appeal of Revenue is dismissed.
Low withdrawal for household expenses - CIT (A) deleted the addition as found that the assessee had shown drawings for household expense - HELD THAT:- DR during the course of hearing could not bring any material on record to controvert the finding of CIT (A) or that the actual expenses incurred by the assessee was higher than Rs. 62,500/-. Hence, we do not find any good reason to interfere with the order of CIT(A), which is confirmed and this ground of appeal of Revenue is dismissed.
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2018 (2) TMI 2127
Surplus on sale of land as capital gains as against the same held as profits and gains from business by the AO - whether the land is a fixed asset as claimed by the assessee or is it ‘stock-in-trade’ as held by the AO - HELD THAT:- From all the facts, the finding of the AO that the assessee has held the land for a short period of seven months is not acceptable. Even if it is held that the land is held for 19 months, the gain is still short term capital gains only. The fact that the assessee has held it as a “capital asset” in its books and has paid the wealth tax over it, clearly prove that it was not held as ‘stock-in-trade’ but was held as a capital asset and the gain therefore is Short Term Capital Gain as offered by the assessee. We do not see any reason to interfere with the orders of CIT (A) on this issue in both the cases. The grounds of appeal on this issue are therefore, rejected.
Set off of STCL against short term capital gain - as per loss on sale of shares is a speculation loss and can be allowed only against speculation income in terms of the explanation to section 73 - HELD THAT:- We find that section 73 deals with the loss in speculative business and explanation thereto provides that where any part of the business of a company (other than a company whose gross total income consists mainly of income which is chargeable under the heads" Interest on Securities", " Income from House Property", "Capital Gains" and " Income from other sources") or a Company (the principal business of which is the business of banking) or the granting of Loans & Advances consists in the purchase and sale of shares of other companies, such company shall, for the purpose of section 73, be deemed to be carrying on a speculation business to the extent to which the business consists of the purchase and sale of such shares".
Admittedly, the gross total income of the assessee consists mainly of short term capital gain and does not consist of income from purchase and sale of shares. Therefore, the explanation to section 73 is not applicable and the capital loss on sale of shares cannot be considered as speculative loss and is to be set off from the short term capital gain.
Addition u/s 68 - increase in share capital of the assessee and has received the premium - assessees are the conduits for the investment of share capital in RCL and JPPL, and the number of share and the premium paid by the CPIPL to the assessees and by the assessees to RCL and JPPL is also the same. Thus, it is clear that the assessee’s have not earned or retained any income to treat it as their income u/s 68 of the IT Act.
We also find that the amendment to Sec. 56(viib) of the IT Act has come into the statute w.e.f 1.04.2013 and prior to such an amendment, there was no provision to tax the share premium as the income of the assessee. For this reason also, the share premium cannot be brought to tax in the hands of the assessee.
We also find that in its recent decision in the case of M/s Apeak InfoTech, Nagpur and others [2017 (9) TMI 1590 - BOMBAY HIGH COURT] has held that the share premium is a capital receipt like share capital and therefore is not taxable.
In the case before us also, the share premium has been brought to tax as the income of the assessee. Respectfully following the decision of the Hon’ble Bombay High Court in the above case (cited supra), we hold that the share premium, even it is in excess of the value of the net worth of the assessee, can only be treated as capital receipt and cannot be brought to tax. Though, we do not agree with the findings of the CIT(A), that it is the income of the individual Shri N. Prasad, and has to be brought to tax in his hands, for the reasons given above, we hold that the share premium cannot be brought to tax in the hands of the assessees before us. Thus, the grounds of the appeal of the revenue on this issue are rejected.
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2018 (2) TMI 2126
TDS u/s 195 - no TDS was deducted on payment made to foreign parties/agents - addition u/s 40(a)(i) - CIT(A) has deleted the disallowance of export commission paid to foreign parties
HELD THAT:- It is clear from the order of the CIT(A) that after applying various judicial pronouncements, he reached to the conclusion that payment to M/s. Columbus Travel Media Ltd., and Zagat Survey LLC cannot be treated as royalty u/s.9(1)Ivi) of the Act. Hence, assessee was not required to deduct tax accordingly, no disallowance can be made u/s.40 (a) (i) of the Act.
Export commission paid to the foreign agents, the CIT(A) recorded a clear finding that commission has been paid for procuring export order and payment was made outside India. After relying on the CBDT Circular No.23 of 1969, 786 of 2000 and 7 of 2009, the CIT(A) held that no tax is deductible in respect of such export commission.
CIT(A) also relied on the decisions Welspring Universal [2015 (1) TMI 736 - ITAT DELHI] and Faizan Shoes (P) Ltd. [2014 (8) TMI 170 - MADRAS HIGH COURT], which has been accepted by the Department and no SLP has been filed. Thus no infirmity in the order of CIT(A) for deleting the disallowance made on account of payment made to foreign parties without deduction of tax at source - Decided against revenue.
Nothing was brought on record by learned DR to persuade us to deviate from the findings and conclusion recorded by CIT(A). Accordingly, we do not find any reason to interfere in the order of CIT(A) for deleting the disallowance made by the AO. Decided against revenue.
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2018 (2) TMI 2125
Challenge to Resolution No.117 of 2018, dated 24.1.2018 of the Special Committee constituted by the Bar Council of India under Section 8-A of the Advocates Act, 1961, to discharge the functions of the Bar Council of Tamil Nadu and Puducherry, whereby the Bar Council of Tamil Nadu and Puducherry Conduct of Election Rules, 1975 have been amended - condition of eligibility of ten years of legal practice as an advocate to contest the election for membership of the Bar Council of Tamil Nadu and Puducherry.
HELD THAT:- The power conferred on the Bar Council of India under Section 49 of the Advocates Act, 1961 does not denude the State Bar Council of power to frame rules. However, the power of the State Bar Council to frame rules is subject to the condition that the Rules made by a State Bar Council are to have effect only if they have been approved by the Bar Council of India and in case of any inconsistency and/or repugnancy between the rules framed by the State Bar Council and the Bar Council of India, the rules framed by the Bar Council of India are to prevail.
Both in Bar Council of Delhi, and Bar Council of Maharashtra and Goa, the Supreme Court set aside rules disqualifying voters upon reference to Section 3(4) of the Advocates Act, 1961, which provides that an advocate shall be disqualified from voting at an election under sub-section (2) or for being chosen as, and for being, a member of a State Bar Council, unless he possesses such qualifications or satisfies such conditions as may be prescribed by the Bar Council of India, and subject to any such rules that may be made, an electoral roll shall be prepared and revised from time to time by each State Bar Council.
Rule 1 of Chapter I of Part III provides that every advocate whose name is on the electoral roll of the State Bar Council shall be entitled to vote at an election. The name of an advocate appearing in the State Roll can only be excluded from the electoral roll, in circumstances specified in Rule 2. Rule 3 makes it clear that subject to the provision of Rule 2, the name of every advocate entered in the State roll shall be entered in the electoral roll of the State Council. The rules framed by the concerned Bar Councils prescribing rules disqualifying votes was found to contravene Section 49 read with Section 3(4) of the Advocates Act, 1961.
In Pratap Chandra Mehta v. State Bar Council of Madhya Pradesh and others, [2011 (8) TMI 1228 - SUPREME COURT] given a wide scope. The Court should give such statutory provision a purposive construction to perpetuate the object of the Act, while ensuring that such rules framed were within the field circumscribed by the parent Act.
A perusal of Section 8-A of the Advocates Act, 1961 makes it abundantly clear that the Special Committee constituted under the said Section has all powers of the State Bar Council mentioned in sub-sections (a) to (c) of sub-section (2) of Section 8-A of the Advocates Act, 1961 - This proposition finds support from the decision of a Division Bench of Kerala High Court in Bar Council of Kerala v. T.D.Parameswaran Unni, [2010 (3) TMI 1291 - KERALA HIGH COURT]. The Division Bench held that merely because earlier resolution had been taken by the Special Committee, the subsequent elected Committee of the Bar Council had no authority to discard such decision.
Petition dismissed.
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2018 (2) TMI 2124
Unexplained cash credits u/s 69 - unsecured loan from the assessee’s mother and family members - HELD THAT:- It is seen that as correctly contended, the impugned additions were made by the AO for the credits shown in the balance sheet, holding them to be "unexplained cash credits". Sec. 69 is applicable to unexplained "investment" and not to "cash credits". No "investment" is alleged by the AO to invoke Sec 69 - CIT(A)'s confirmation of addition u/s 69 of the Act is also incorrect.
CIT(A) himself observes that "unlike section 68, under section 69 there is no condition for any investment to be recorded in the books of accounts." Thus he accepts that while maintenance of books is not a condition precedent for invoking sec. 69, it is so for section 68. CIT(A) failed to appreciate that the additions made by the AO were for alleged "unexplained cash credits" and not for "unexplained investment". Thus, CIT(A) was legally incorrect in confirming the additions u/s 69.
The submissions of the assessee were forwarded by the CIT(A) to the AO for his comment. During the remand proceedings, the assessee again made detailed submissions before the AO.
In the remand report, the AO did not bring out any new fact, nor commented anything specific against the assessee. Rather, on ground wise specific submissions, the AO's comments were that no new fact had been brought on record, the cases relied by the assessee were in his favour and it was for the ld. CIT(A) to decide the issues on the facts available on record. If the provisions invoked are held to be non applicable, the very charge for making the addition does not survive and it cannot be converted to that of another entirely different provision.
Section 69 of the Act concerns cases where the assessee had made investments which are not recorded in the books of account, if any, maintained by him for any source of income and the assessee offers no explanation about the nature and source of the investments, or the explanation offered by him is not, in the opinion of the AO, satisfactory. In the present case, the assessee is not shown to have made any “investment” and, therefore, the provisions of section 69 of the Act are not attracted.
Applicability of Section 68 and 69 - Now, once the addition is not sustainable under section 69, all questions raised by the AO or the ld. CIT(A) become otiose.The impugned addition, being alleged as "unexplained cash credits", could only be made u/s 68 of the Act.
Sec 68 stipulates that if any sum is found credited in the books of account maintained by the assessee and he offers no explanation, or his explanation is not found satisfactory, such sum could be deemed to be income of the assessee. In the present case, since the assessee's gross receipts were below Rs.40 lac, he has not been shown to maintain any books.
CIT(A)'s observation that there is no proposition in law for non maintenance of accounts for cases falling u/s 44AD, is incorrect. The provisions of sub section 5 of Sec. 44AD read with those of Sec. 44AA (2)(iv) statutorily mandate the maintaining of books of account for the cases filling u/s 44AD only when the net profit is less than 8%. In other words, where the case is covered by Sec 44AD, i.e., where the turnover is below Rs. 40 lacs and the declared net profit is 8% or more, no books of account are required to be maintained.
The fact of non maintenance of books of account by the assessee was also in the knowledge of the AO, obviously, as he did not at all call for the books of account either through the notice u/s 142(1), or through the order sheet.
CIT(A)'s observation regarding probable maintenance of accounts, is nothing but a mere surmise and conjecture. Appearance of the Accountant or the Chartered Accountant before the AO does not establish that books were actually maintained by the assessee. As a matter of fact, no books of account are found to have been maintained by the assessee, which is a sine-qua-non for the addition of “unexplained cash credit”.
No addition could be made on the basis of either of the estimated balance sheets, particularly when no books were maintained, without making further enquiries, and bringing on record any corroborative material. It is pertinent that the assessee's bank statement was before the AO, but no entries of the alleged amounts were pointed out by the AO.
AO’s allegation that the bank statement of mother Smt. Usha Malhotra for entry of 50,000/- on 12/04/2005 was not filed is also not correct. In the very bank statement, which was before the AO, there was this entry on 15/04/2005, posted by the bank on clearing of cheque. Further, along with the revised estimated balance sheet, the assessee also furnished confirmations from his father, mother and other lenders. If the AO wanted to verify the credits in the revised balance sheet, which were supported by confirmations, he could have easily exercised his powers either u/s 133 (6), or u/s 131. But he did not do so and simply made the additions on the basis of first estimated balance sheet, which, as observed, is unsustainable in law. Assessee appeal allowed.
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2018 (2) TMI 2123
Interpretation of section 24 of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 and section 31 of the Land Acquisition Act, 1894 - HELD THAT:- Having regard to the nature of the issues involved in the matter, the issues need to be resolved by a larger Bench at the earliest.
These matters may be placed before the appropriate Bench tomorrow i.e. 23rd February, 2018, as per orders of Hon’ble The Chief Justice of India.
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2018 (2) TMI 2122
Interpretation of Section 24 of Land Acquisition Act - HELD THAT:- It would be appropriate if in the interim and pending a final decision on making a reference (if at all) to a larger Bench, the High Courts be requested not to deal with any cases relating to the interpretation of or concerning Section 24 of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. The Secretary General will urgently communicate this order to the Registrar General of every High Court so that our request is complied with.
Insofar as cases pending in this Court are concerned, we request the concerned Benches dealing with similar matters to defer the hearing until a decision is rendered one way or the other on the issue whether the matter should be referred to larger Bench or not. Apart from anything else, deferring the consideration would avoid inconvenience to the litigating parties, whether it is the State or individuals.
Issue notice on SLPs returnable on 7th March, 2018.
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2018 (2) TMI 2121
Estimation of income - bogus purchases - HELD THAT:- While relying upon Judgments Bholanath Poly Fab Ltd. [2013 (10) TMI 933 - GUJARAT HIGH COURT], Simit D, Sheth [2013 (10) TMI 1028 - GUJARAT HIGH COURT] and Sanjay Oil Cake Industries [2008 (3) TMI 323 - GUJARAT HIGH COURT] and taking into consideration the facts of the present case, and to account for the profit element embedded in these purchase transactions to factorize profit earned by assessee against purchase of material in the grey market and undue benefit of VAT against bogus purchases, we are of the considered view that the ends of justice would be met in case the additions are restricted @ 12.5% of the bogus purchases. Consequently orders passed by Ld. CIT(A) are set aside and AO is directed to restrict the additions accordingly. Grounds raised by the assessee are partly allowed.
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2018 (2) TMI 2120
Seizure of jewellery [gold bangles and one gold chain] at airport - petitioner had not declared the quantum of jewellery borne on her person - petitioner is a Myanmar national and landed in India at Trichy airport - Petitioner now seeks only provisional release of the seized items - HELD THAT:- In the present case, the petitioner can be permitted to take back being seized goods on deposit of a sum of Rs.3,00,000/- through her power agent who undertakes to deposit the said sum with the third respondent. On such deposit being made, the seized items shall be returned to the power agent.
It is made clear that the adjudication proceedings shall go on and the petitioner shall extend the fullest co-operation for expeditious conclusion of the said proceedings. It is further made clear that the power agent is entitled to handed over such returned jewellery to the principal, namely, the petitioner herein by taking it back.
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2018 (2) TMI 2119
Chargesheet filed pursuant to the F.I.R.s - Offences punishable u/s 420, 467, 468 and 471 read with 34 of the IPC. The said F.I.R.s have been lodged by the SEBI - The gravamen of the allegations is relating to the cornering of the shares meant for retail investors in the IPO of YES Bank - petition has been filed in January 2018 challenging the chargesheets which have been filed on 02/03/2009.
HELD THAT:- Petitioner endeavoured to demonstrate to us that there is no complicity of the Petitioner in the offences alleged. In our view, it is not possible to accept the said contention at this stage.
Having regard to the facts as aforestated, we do not deem it appropriate to exercise our writ jurisdiction under Article 226 of the Constitution of India. The Writ Petition is accordingly dismissed. Needless to state that the Trial Court would try the case in question on its own merits and in accordance with law.
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2018 (2) TMI 2118
Implementation of the severance package - approval of VRS package for the employees of wound up company employees - income tax recoverable from severance package - Appellant Company was declared as a Sick Industrial Company and the Board for Industrial and Financial Reconstruction (BIFR) recommended the winding up - As decided by HC [2017 (6) TMI 1396 - MADRAS HIGH COURT] company is facing the burden of winding up and other aspects, if there is any claim other than the Central Government Scheme, then it could be delayed elsewhere.
Order of the learned Single Judge modified to the effect that there is no burden on the company to that extent. So far as the liquidation proceedings is concerned, the first charge over the assets of the company will be on the Central Government since they step into the shoes of the workmen by taking over to discharge the burden of the company by way of VRS Scheme and for the remaining charge is concerned it is for the liquidator to decide on the issue - we dispose of the appeal filed by the Company, modifying the order of the learned Single Judge. Two months time is granted to the Central Government to implement the VRS Scheme from the date of receipt of this order.
HELD THAT:- No ground for interference is made out in exercise of our jurisdiction under Article 136 of the Constitution of India.
SLP is accordingly dismissed. Pending application, if any, stands disposed of.
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2018 (2) TMI 2117
Deduction u/s 80P - transfer fees and interest receipts - assessee is a Cooperative Society and is exempted from the payment of income tax upon the transfer fee received from the members - Sizable transfer fee has been received and the deductions have been claimed, which are not allowed by the AO - HELD THAT:- This appellant is claiming to be a Cooperative Society and, hence, claiming exemption u/s 80P (2) (a) (i) of the Income-tax Act. This contention is not helpful to this assessee-appellant mainly for the reason that the main activity of this appellant is to construct dwelling units or residential flats and to sell it to the public at large. There are no fixed or definite members of this appellant.
As appears from the facts that those who are purchasing the flats from this appellant, they have to pay the sale price as well as transfer fee. Hence, the transfer fee is a part & parcel of the sale price. In the present case, such transfer fee accumulated for the assessment year 2002-03 is at Rs. 9,60,470/-. This is not exempted at all, looking to the nature of activity of this appellant. This transfer fee has been received by this appellant from a new member on their joining to the Society. Thus, firstly the flat is purchased, thereafter the purchaser becomes member of the Society. The main object of this Society is to construct the residential flats and to sell them to the public at large. Thus, the transfer fee is a part & parcel of the sale price. This aspect of the matter has been properly appreciated by the Income Tax Appellate Tribunal under the Income-tax Act.
As further appears from the facts that sizable interest receipt has been claimed by this assessee as exempted under Section 80P (2) (a) (i) of the Income-tax Act on the ground that this appellant is giving credit facility to its members. This contention is not accepted by this Court mainly for the reasons that the basic purpose of this assessee is not to provide credit facility to the members. Basically, the members are not fixed or definite persons. The basic goal of this assessee is to construct residential flats and to sell it to the public at large. After purchase of the flats, the purchasers have to become members of the Society. Thus, provision of Section 80P (2) (a) (i) of the Income-tax Act is not applicable to the facts of the present case.
Hence, there is no substance in this Tax Appeal, as no substantial question of law is involved. This Tax Appeal is dismissed with a cost of Rs. 5000/-.
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2018 (2) TMI 2116
Validity of Reassessment Proceedings - Addition on account of prior period expenses and claim of receivables - HELD THAT:- There was no tangible material outside the record which was the basis of reassessment proceedings. Admittedly there is no reason to believe that income has escaped assessment, as assessee has not claimed the amount that has been the addition in the reassessment proceedings. The observations of Ld. AO in the original assessment proceedings are very much pertinent at this juncture.
AO therein has given categorical finding regarding the expenditure not been considered for the purposes of deduction in the P&L account. The decisions relied upon by Ld. DR in the written submissions filed mostly relate to situations where there was tangible material available outside the record based on which Honble Supreme Court and various High Courts have held reassessment proceedings to be valid.
There was no tangible material in the possession of Ld. AO to initiate the reassessment proceedings and the additions made by Ld. AO was based on the materials already on record which has failed to stand the test of law as the same has been deleted by Ld. CIT (A) by observing categorically that they were never considered for the purposes of deduction in the original assessment proceedings itself. - Decided in favour of assessee.
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2018 (2) TMI 2115
Dishonour of Cheque - Insufficient Fund - valid cheque or not - accused denied his signature - cheque issued validly against any legally enforceable debt or liability, or not - HELD THAT:- Learned appellate court has been guided by the fact that the endorsement by the Bank clearly indicated that the cheque was not valid. Why the cheque was not valid or valid had to be shown by the complainant through his evidence and/or by examination of the banker, which he failed to do. The complainant also failed to state clearly the date and time of the friendly loan or any documentary evidence of such friendly loan having been advanced to the accused.
The complainant-petitioner has failed to make out any case for grant of leave to appeal.
The instant petition is, accordingly, dismissed.
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2018 (2) TMI 2114
Validity of reopening of assessment u/s 147 - satisfaction for issuance of notice u/s. 148 by appropriate authority - whether satisfaction in accordance with section 151(1) is recorded by the prescribed authority or not? - HELD THAT:- At the time of hearing, learned AR has submitted before us a copy of the form for recording the reasons for initiating proceedings u/s. 148 which reveals that the satisfaction for issuance of notice u/s. 148 of the Act was recorded by the Additional CIT, Range 12(1), Mumbai. Thus, the aforesaid facts brought on record demonstrate that the recording of satisfaction for issuance of notice u/s. 148 of the Act was not by any of the authorities prescribed under the proviso to section 151(1).
DR has not brought any material before us to controvert the aforesaid factual position. That being the case, the notice issued u/s. 148 of the Act being not in accordance with the provisions of section 151 of the Act is invalid. Consequently, the proceedings conducted in pursuance of such notice as well as the assessment order passed u/s. 143(3) r.w.s. 147 of the Act in pursuance thereto is rendered invalid.
It is relevant to observe, in assessee's own case for A.Y. 2006-07, [2016 (6) TMI 836 - ITAT MUMBAI] the assessment order was quashed by the Tribunal under identical facts due to lack of satisfaction by the prescribed authority in terms of proviso to section 151(1) - Hon'ble Bombay High Court has expressed similar view in the case of Ghanshyam K Khabrani [2012 (3) TMI 266 - BOMBAY HIGH COURT]In view of the aforesaid, we have no hesitation in quashing the impugned assessment order. The grounds raised are allowed.
Re-opening of assessment on the basis that the assessee is not eligible to claim deduction u/s 801B(10) for the housing project as it was not completed on or before 31% March 2009 - HELD THAT:- AO while completing the original assessment has examined all facts and materials relating to assessee's claim of deduction under section 801B(10) of the Act in respect of the housing project and only after proper application of mind has allowed assessee's claim of deduction. While re-opening the assessment, the Assessing Officer had no tangible material to come to the conclusion that there is escapement of income. Only on re-appraisal of the material available at the time of original assessment the AO has reopened the assessment under section 147 of the Act by forming a belief that the assessee is not eligible to claim deduction under section 80IB(10) of the Act due to non-completion of the project within the stipulated time. Thus, consideration of facts and material on record in the light of well settled legal principle leads to the irresistible conclusion that the AO has re-opened the assessment on a mere change of opinion without having in his possession any tangible material.
Therefore, it amounts to review of the original assessment order passed in case of the assessee, hence, is legally impermissible. Therefore, we are of the considered opinion that re-opening assessment under section 147 of the Act in the instant case is not valid; consequently, the impugned assessment order passed in pursuance thereto is also invalid and has to be quashed. Decided in favour of assessee.
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