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Showing 1 to 20 of 1238 Records
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2014 (5) TMI 1243
Method of valuation for determination of assessable value - assessable value should be determined under Rule 8 of the Central Excise Valuation Rules, 2000 or not - HELD THAT:- As held by the co-ordinate Bench at Ahmedabad in the case of CCE Vs. Rolaster Pvt. Ltd. [2011 (9) TMI 776 - CESTAT, AHMEDABAD], Rule 8 or Rule 10A of the Valuation Rules would not apply to the facts of the present case as the principal manufacturer has captively consumed the job-worked goods supplied. Since there is no sale, the value of the goods has to be arrived at as per Ujagar Prints formula laid down by the Hon’ble Apex Court on the basis of the cost of raw materials plus job charges including the profit of the job-worker. There is no dispute that the appellant has discharged the duty liability accordingly.
Conclusion - When job-worked goods are captively consumed by the principal manufacturer, Rule 8 or Rule 10A of the Valuation Rules does not apply, and duty liability should be based on the cost of raw materials plus job charges, including the job-worker's profit.
The impugned order is not sustainable in law - Appeal allowed.
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2014 (5) TMI 1242
Maintainability of suit filed by respondent Nos. 1 to 4 - jurisdiction to entertain and try the suit - bar on judgment of a Civil Court to consider the validity of the appointment of directors - hether in view of section 10-A of The Banking Regulation Act, 1949, which came into effect from 1st February, 1969, the question of validity of appointment of directors can only be raised before and decided by the Reserve Bank of India and not by any other Court, Tribunal or authority? - HELD THAT:- The object of the Legislature was not to exclude the challenge to the appointment of directors altogether. The object of section 10A was to provide for the nature of the constitution of the Board of directors of a banking company. The object was to ensure that a requisite percentage of the Board of directors hold the qualifications prescribed in sub-section (2) and to exclude the possibility of any conflict of interest of the nature stipulated in clause (b) of sub-section (2). The Legislature provided for a percentage of the total member of the Board of directors to consist of persons having a particular academic background and/or the requisite experience and/or possessing the requisite knowledge as stipulated in sub-clause (a) of sub-section (2) of section 10A. The Legislature was obviously of the view that such a composition of a Board of directors was necessary in the interest of banking companies and, therefore, provided for the same. The intention, therefore, was to ensure that the Board of directors comprises of a percentage of directors with the requisite qualifications and/or experience and/or knowledge.
The intention was not to interfere with the machinery provided under the Companies Act regarding the appointment and removal of directors. Nor was it to denude the civil courts of their jurisdiction to decide disputes relating to the validity of the appointments of directors on the Board of a banking company.
Section 10-A has, however, curtailed the jurisdiction of the civil courts, but only to a limited extent. As we mentioned earlier, we will restrict this judgment by deciding only the question that arises in this case - The words "under this section" in sub-section (6) make it clear that the Legislature never intended to curtail the jurisdiction of civil courts at least to the extent suggested on behalf of the appellant. Had it been so, section 10A and in particular, sub-section (6) thereof would have been worded entirely differently.
Conclusion - Once the procedure is followed, the appointment of a director cannot be challenged on any other ground whatsoever, including that it was contrary to any provision of law or contract. So long as the appointment is legally valid, following the legal procedure mandated under the Companies Act and in compliance with section 10A of The Banking Regulation Act, a court cannot assume jurisdiction to consider the validity of such appointment/election. To do otherwise would enable a court in every case to ignore the bar of jurisdiction under section 10A since all challenges would necessarily be made on the basis of an allegation that an appointment/election has not been duly made or duly held.
The appeal is dismissed.
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2014 (5) TMI 1241
Sanction of Scheme of Arrangement for demerger - HELD THAT:- It has neither the expertise nor the jurisdiction to examine matters that lie within the commercial wisdom of creditors and members of the Company. The sanctioning Court must ensure that the requisite statutory procedure has been followed and that the scheme as a whole is found to be just, fair and reasonable from the point of view of prudent men of business taking a commercial decision. Once these broad parameters are met, the Court has no further jurisdiction, let alone an appellate jurisdiction. Moreover, once a share exchange ratio has been worked out by a recognised firm of Chartered Accountants, it is not for the Court to substitute its own view as to the share exchange ratio especially when the one recommended by the Chartered Accountants has been accepted by the overwhelming majority of the shareholders and creditors. In the present case, Tata Capital is unable to show how the scheme is prejudicial to a class. All the Tata Capital says is that some other valuation method ought to have been used. No attempt is made to demonstrate how the present valuation method prejudices the shareholders or other creditors.
It is settled law that there need not be a unity of the objects or purposes of the two companies in question, whether in a scheme of amalgamation or in a scheme of demerger as in the present case. Where it is demonstrated that business efficiency and commercial prudence justify such a demerger, it cannot be opposed by the solitary creditor on the ground that its debts, though otherwise secured, and though otherwise sought to be enforced, have not been fully satisfied.
Conclusion - The commercial wisdom of shareholders and creditors should be respected unless there is clear evidence of unfairness or public harm.
There is no substance to the objections raised. The Scheme is sanctioned as prayed for.
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2014 (5) TMI 1240
Contravention of section 9(1)(b) and section 9(1)(d) of FERA - amounts confiscated by the impugned order - penalties imposed commensurate with the contraventions - amounts alleged to be received from, and distributed to persons who are not authorized dealers in foreign exchange by order or on behalf of one, Shri Adbul Salan of Abu Dhabi, a person resident outside India without the previous, general or special exemption of the Reserve Bank of India - submissions of the appellant that the mere confessions of the co-accused were later retracted and the same should not be admissible in evidence
HELD THAT:- Adjudicating Officer is not bound to observe the provisions of Indian Evidence Act, 1872. He may follow the provisions of the Indian Evidence Act, 1872 and as he is not bound, he may deviate from the provisions of the Indian Evidence Act for the sake of justice under the circumstances
Statement of the appellant, though retracted, is corroborated by the statements of the other witnesses and the documentary evidence which appears not to be doubtful. In such circumstances, where the corroborating witnesses have not been cross-examined and there is no doubt appears from the statements which is required to be cross-examined to clarify the veracity, such statements should not be condemned. The penalties imposed on the appellant also commensurate with the amounts involved in the contraventions and are not excessive and the confiscation of the amounts appears in accordance with section 63 of FERA.
In view of the above this Tribunal finds nothing material to interfere with the Impugned Order
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2014 (5) TMI 1239
TP Adjustment - transaction in question, facially, does confirm to the description of an ‘international transaction’ or not? - petitioner argues that the AO acquires the jurisdiction to refer the computation of arm’s length price to the TPO only upon his formation of opinion, based upon existence of material, that a transaction amounts to an international transaction, and not otherwise.
HELD THAT:- The transaction in the present case involves investment into M/s Bharti AXA Life Insurance Co. Ltd. The petitioner, First American Securities holds certain shares in the said M/s Bharti AXA Life Insurance Co. Ltd. An end eavour was made to suggest that the nature of the transaction, specially the nature of share holding, is facially so small that there cannot be any reasonable opinion that AXA India Holdings, Mauritius is an associated enterprises or that the transaction of it subscribing to equity shares was an international transaction.
As revenue opposes the claim and submits that given the wording of Section 92CA of the Act, if the Assessing Officer on coming across any transaction which may amount to an international transaction, is of the view that it is 'necessary or expedient to do so' he can with the previous approval of the Commissioner refer the computation of arm’s length price of an international transaction to the Transfer Pricing Officer.
Having regard to the submissions, this Court is of the opinion that it would not be expedient at this stage to intervene under Article 226 of the Constitution of India.
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2014 (5) TMI 1238
Imposition of conditions under Section 482 Cr.P.C. for appointment of an authorized representative in a criminal complaint - asking the representative to furnish bonds - whether the condition imposed amounts to issuance of direction to the company to furnish bonds and this condition is illegal and erroneous as there is no provision in the Cr.P.C.? - HELD THAT:- Section 305 Cr.P.C. deals with appointment of representative for the purpose of enquiry or trial. Clause 3 to Sub-section 305 sates that where a representative of a corporation appears, any requirement of this Code that anything shall be done in the presence of the accused or shall be read or stated or explained to the accused, shall be construed as a requirement that thing shall be done in the presence of the representative etc. and any requirement that the accused shall be examined shall be construed as a requirement that the representative shall be examined. Clause 4 of this Section states that where a representative of a corporation does not appear, any such requirement as is referred to in sub-section(3) shall not apply.
The above laid procedure clearly shows that if any representative does not appear, then the condition that he shall be examined or anything is to explained to representative or to be read to him or evidence is to be taken in his presence, will not apply. It is nowhere written in the procedure that like an accused, bail bonds and surety bonds are to be taken or in his absence, non-bailable warrants be issued to procure the presence of the representative. It is also nothing in this provision that evidence must be recorded in the presence of representative or representative must be examined as is required for an accused. Therefore, in view of the specific provisions in the Cr.P.C., no bail bonds can be taken from the representative and his presence cannot be compelled on each and every date.
The part of the impugned order whereby the representative of the Company was directed to furnish the bail bonds/surety bonds is set aside. Keeping in view the above discussion, the condition cannot be imposed as per the provisions of Section 305 Cr.P.C.
Petition allowed.
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2014 (5) TMI 1236
Maintainability of appeal - requirement of pre-deposit - HELD THAT:- It is found that the first appellate authority has directed the appellant to deposit an amount of Rs.80,000/- for hearing and disposing the appeal on merit and report compliance which was not one so. In the facts and circumstances of the case, it is found that the order of pre-deposit as directed by the first appellate authority is reasonable one and does not require any interference and the appellant should have complied with the same. Be that as it may, it is directed that the appellant to pre-deposit an amount of Rs.80,000/- within a period of four weeks from today and report compliance to the first appellate authority on 26.06.2014.
On such compliance being shown, the first appellate authority will restore the appeal to its original number and dispose of the same after following the principles of natural justice.
The appeal are allowed by way of remand.
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2014 (5) TMI 1235
Ownership of suit property - plaintiffs are landlords and the Defendants are tenants of the suit premises or not - Defendants have committed breach of agreement of lease by not maintaining the property and by causing damage to it or not - Defendants have disowned the title of the Plaintiff and thereby committed breach of the agreement of lease or not - damage to suit property - jurisdiction to entertain, try and decide the suit - HELD THAT:- The land of the suit premises belong to the Union of India-Appellants herein. Therefore, they cannot be held to be tenants of the suit premises comprising of an area of 0.90 acres together with structure consisting of main Bungalow, Servant Quarter and Garage.
The Plaintiffs-Respondents have only right with regard to the structure built on the suit premises. The Union of India-Appellants have a right for resumption of the suit premises, as evident from evidence on record. This issue was not properly appreciated by the Trial Court, the Appellate Court and the High Court which also failed to notice the Appellants' right Under Section 2 and 3 of the Government Grants Act, 1895.
The impugned judgment is set aside - appeal allowed.
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2014 (5) TMI 1234
Seeking sanction to the Scheme of Amalgamation - sections 391 to 394 of the Companies Act, 1956 - HELD THAT:- In view of the approval accorded by the Shareholders and Creditors of the Petitioner Companies; representation/reports filed by the Regional Director, Northern Region and the Official Liquidator, attached with this Court to the proposed Scheme of Amalgamation, there appears to be no impediment to the grant of sanction to the Scheme of Amalgamation. Consequently, sanction is hereby granted to the Scheme of Amalgamation under sections 391 and 394 of the Companies Act, 1956. The Petitioner Companies will comply with the statutory requirements in accordance with law.
Petition allowed.
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2014 (5) TMI 1233
Imposing a punishment of reduction to the minimum/initial pay scale of Executive Engineer which is a major punishment under the U.P. Government Servant (Discipline and Appeal) Rules, 1999 - absence of any enquiry, including oral enquiry, by the enquiry officer - violation of principles of natural justice (audi alterem partem) - HELD THAT:- Cases, involving serious charges of financial irregularities and misconduct where the amount involved runs into lacs and crores, are allowed, only on the ground that no enquiry has been held as per law. It is high time the respondents woke up to this situation. Apathy in such matters not only results in guilty officers/employees getting away with their misdeeds to the detriment of the department and the common man but it also leads to unnecessary litigation before the Courts adding to their burden resulting in waste of time, energy and money.
Much of the aforesaid wastage can be avoided if the State Government looks into the matter and issues necessary directions to the disciplinary authority and where it is itself the disciplinary authority, it should ensure that at the time of appointing an enquiry officer, he should be informed in writing about the procedure required to be followed by him under law for holding an enquiry so that there may be no procedural irregularity. If need be, the opinion of the Law Department can also be taken in this regard. The State Government is directed to take necessary action in this regard.
In the instant case, it is found that the charges against the petitioner were very serious but no enquiry has been held by the Enquiry Officer, therefore, the impugned order of punishment, passed on the basis of such an enquiry report, cannot be sustained for this reason alone. This leaves us with no other option but to quash the punishment order. The same is, accordingly, quashed.
Petition allowed in part.
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2014 (5) TMI 1232
Amendment of plaint and Order 1 Rule 10 CPC for impleading proposed defendant Nos. 6 to 15 - HELD THAT:- The High Court should not be stressed-out to deal with such a combined application compressed into one impugned order needlessly to unravel causing sheer wastage of its precious time in trying to separate what was so casually and mindlessly mixed-up in a cocktail by virtue of bad advice given by some trial lawyer to his client clubbing two disparate legal elements in a portmanteau application claiming amendment in pleadings and at the same time, in the same papers, seeking to introduce third parties in the pending litigation. Every minute of the High Court's time squandered involves colossal expenditure which is incapable of calculation and therefore recompense. The reward of justice is none other than justice and time consumed in trying to meet it is alone its justification as an end to the means - There is a presumption in law that a lawyer knows the law but there is no absolute presumption that a judge should know law. A judge is only called upon to balance the two sides of an argument presented before him.
There are no cogent ground to support the impugned order dated April 4, 2013 or to sustain it and to the contrary I think it is eminently fit to be set aside to avoid a failure of justice. It is accordingly so ordered. The matter is remitted back to the trial Judge for a re-consideration. The respondent/plaintiff is left free to file two separate applications, one under Order 6 Rule 17 and one under Order 1 Rule 10 CPC within a fortnight from the date of receipt of certified copy of this order. The defendants would file replies thereto within the next fortnight.
In the circumstances, and in order not to cause any prejudice to either party the fresh applications to be filed by the plaintiff will relate back by fiction to the date of the original misconceived and ill-thought combined application presented in the year 2010 so that neither party is affected by any legal disability arising during the intervening period if it were not so ordered, but if they are filed within the time frame fixed by this Court, as was agreed upon.
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2014 (5) TMI 1231
Territorial Jurisdiction of High Court - Doctrine of forum convenience - Cause of action arising in territorial jurisdiction or not - Seeking that the order granting it leave to withdraw the writ petition be recalled and the same be restored for being heard on merits - HELD THAT:- After the insertion of Clause (1-A) (renumbered as Clause (2), the jurisdiction of a High Court can be invoked if the cause of action arises, wholly or in part, within the territorial jurisdiction of that court. However, the expression "cause of action" has not been defined in the Constitution or in the Code of Civil Procedure. As observed by the Supreme Court in the case of EASTERN COALFIELDS LTD. VERSUS KALYAN BANERJEE [2008 (3) TMI 480 - SUPREME COURT], 'cause of action', for the purpose of Article 226(2) of the Constitution of India, for all intent and purport, must be assigned the same meaning as envisaged under Section 20(C) of the Code of Civil Procedure. It means a bundle of essential facts that are required to be proved. However, the entire bundle of facts pleaded, need not constitute a cause of action and what is necessary to be proved is such material facts based whereon a writ petition can be allowed.
Recently, a Full Bench of five Judges of this Court in the case of M/S. STERLING AGRO INDUSTRIES LTD. VERSUS UNION OF INDIA & ORS., JAN CHETNA VERSUS MINISTRY OF ENVIRONMENT AND FORESTS & ORS., MANU JAIN VERSUS SMT. NEERJA SHAH & ORS., M/S BAFNA HEALTHCARE PVT. LTD. & ORS. VERSUS COMMISSIONER OF CENTRAL EXCISE DELHI-IV & ORS., THE COMMISSIONER OF TRADE TAX & ANR. VERSUS M/S. RICOH INDIA LTD. & ORS. [2012 (6) TMI 76 - DELHI HIGH COURT - LB], had the occasion to examine the doctrine of forum convenience and the concept of cause of action in view of conflicting judgments on the issue referred to them. After examining a number of decisions of the Supreme Court on this issue including the cases of NASIRUDDIN VERSUS STATE TRANSPORT APPELLATE TRIBUNAL [1975 (8) TMI 126 - SUPREME COURT], KISHORE RUNGTA VERSUS PUNJAB NATIONAL BANK [2001 (3) TMI 944 - BOMBAY HIGH COURT], ALCHEMIST LIMITED VERSUS STATE BANK OF SIKKIM [2007 (3) TMI 382 - SUPREME COURT], the Full Bench observed The said doctrine of forum non-convenience can be invoked when the court deciding to refrain from exercising its jurisdiction, is vested with the jurisdiction to decide the case.
Coming to the facts of the instant case and taking into consideration the relevant factors that must weigh with the court when deciding the issue of territorial jurisdiction, it is considered necessary to peruse the averments made in the writ petition. A plain reading of the present petition would reveal that the entire focus of the petitioner is on the Loan Agreement dated 7.11.2008 executed with the respondent/Corporation at Jaipur, and the Sub-Lease Deed dated 11.1.2008 executed with the sub-lessors in respect of the project land situated at Udaipur. The petitioner's stand is that the respondent/Corporation had wrongfully issued the impugned Loan Recall Notice dated 20.1.2014, when no sub-lease rental was payable by it under the Sub-Lease Deed and at no stage was it in default of the Loan Agreement or the Sub-Lease Deed.
In the present case, the mere location of the registered office of the respondent/Corporation in Delhi, cannot be a ground to canvass that the cause of action has arisen within the territorial jurisdiction of this Court, unless and until the petitioner has been able to point out that some material decision had been taken at the office of the respondent that would have a bearing on the present petition. A bald submission made to the effect that ordinarily a decision to recall a loan from a client is taken at the head office of the respondent/Corporation would not be of much assistance to the petitioner.
This Court is of the view that the facts relating to jurisdiction that have been pleaded in the application and for that matter, in the writ petition, can hardly be stated to be either essential or material, much less integral for constituting a part of the cause of action, as envisaged under Article 226(2) of the Constitution of India, for vesting territorial jurisdiction on this Court.
This court is inclined to accept the submission made by learned counsel for the respondent/Corporation that neither the factors mentioned by the petitioner, nor the circumstances would by themselves confer territorial jurisdiction on this court for maintaining the petition in Delhi. Rather, this Court is of the opinion that it would be inconvenient for it to entertain the present petition and the High Court of Rajasthan would be better equipped to deal with the issues raised in the present petition. Accordingly, this Court declines to exercise the discretionary jurisdiction vested in it under Article 226 of the Constitution of India.
The present application is dismissed.
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2014 (5) TMI 1230
Revision u/s 264 - refund claim as exemption u/s 10(10C) and 89 denied but latter on allowed - issue of law as decided in favour of the assessee in another matter by this Court in the year 2008 and by the Apex Court in the year 2009 - assessee filed the application u/s 154 for rectification of the assessment order which was rejected and petitioner filed a revision u/s 264 to the Commissioner of Income Tax, for refund - whether the petitioner is entitled to enforce that remedy in the manner in which she has done? - HELD THAT:- In a similar matter, a Division Bench of this Court in the case of Devdas Rama Mangalore [2014 (2) TMI 132 - BOMBAY HIGH COURT] granted complete relief, including an order of refund.
The only difference between this case and that case is that, in that case, the petitioner had made an application for condonation of delay under Section 119 (2) (b) of the Income Tax Act, which was rejected, in view of the circular issued by the CBDT. In the case before us, the course adopted was under Section 264 of the Act.
The course adopted by the petitioner in the facts and circumstances of the present case was valid. We allow the petition by directing the respondent to allow refund due to the petitioner.
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2014 (5) TMI 1229
Permanent stoppage of two increments - acts of misconducts alleged against the respondent - HELD THAT:- It is crystallised that when the right to conduct a de-novo enquiry is reserved in the written statement, and the Labour Court or Tribunal has framed the two issues referred above, in relation to the enquiry, the said issues are to be decided as preliminary issues, before taking up other issues. It is an anathema to decide the first two issues together with the other issues. Whenever, in proceedings under the MRTU & PULP Act, 1971 or the IDA, 1947, a domestic/departmental enquiry is under challenge with pleadings and substantive prayers seeking the quashing of the domestic enquiry on the ground of either non-observance of the principles of natural justice or findings being perverse, the Court or Tribunal has to frame a preliminary issue and try the same peremptorily.
In the instant case, the respondent-workman had challenged the findings of the EO and an issue to that extent was cast by the Industrial Court. Eventually, the Industrial Court relying upon evidence adduced before it as well as the evidence recorded in the enquiry, came to a conclusion that the findings of the EO are perverse - In fact, the Industrial Court concluded that the charges levelled upon the respondent are fictitious and they are not proved in the enquiry. By doing so, the Industrial Court has ventured into the realm of questioning the quality of evidence recorded in the domestic enquiry and the conclusions drawn by the EO. By doing so, it has branded the findings to be perverse and thus, the enquiry stood watered down.
When the Industrial Court was called upon to brand the findings as perverse, the procedure that is required to be followed by the Labour Court/Tribunal in dealing with the cases of dismissal post domestic enquiry, applies mutatis mutandis to the Industrial Court/Tribunal as well. By setting aside the finding of the EO by the Industrial Court, in effect has resulted in the quashing and setting aside of the domestic enquiry. Procedure as laid down in the Judgment of the Hon'ble Apex Court referred here in above, was equally applicable to the Industrial Court in the present case, since its conclusion on the findings of the EO has resulted in the setting aside of the enquiry - the Industrial Court could not have set aside the enquiry by branding the findings as being perverse without trying the said issue as a preliminary issue and by depriving the employer an opportunity to conduct a de-novo enquiry in the Court.
The impugned judgment of the Industrial Court is quashed and set aside - the petitioner be granted the liberty to conduct a de-novo enquiry in which the evidence already recorded before the Industrial Court can be utilised, as well as the parties are at liberty to lead additional evidence - Petition allowed in part.
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2014 (5) TMI 1228
Addition u/s 14A r.w.r. 8D - claim of the assessee was that no expenditure had been incurred by it to earn the exempt income - HELD THAT:- Undoubtedly, the assessee had not accounted for any expense. AO applied the provisions of Section 14A r.w.r. 8D of the Rules. The issue is as to whether these provisions are applicable to an assessee, who has been admitted to be a dealer in shares, as has been done by the AO in the present case.
In ‘CCI Ltd.’ [2012 (4) TMI 282 - KARNATAKA HIGH COURT] has held that if the assessee is a dealer of the shares and securities, it cannot be said that the purchases of the shares and holding of shares made by it were for the purpose of earning of dividend income; and that hence, the expenditure incurred in acquiring these shares cannot be disallowed u/s 14A - like in the present case, it was the admitted position that the assessee was a dealer in shares and securities. ‘CCI Ltd.’ (supra) was followed by the Ahmedabad Bench of the Tribunal in ‘Hina Nitin Parikh’ [2013 (7) TMI 514 - ITAT AHMEDABAD] - Decided in favour of assessee.
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2014 (5) TMI 1227
Jurisdiction of State Government to pass detention order - whether the State Government has the power to pass a detention order to detain a person at a stretch for a period of 12 months under the provisions of the Act? - section 3 of Andhra Pradesh Prevention of Dangerous Activities of Bootleggers, Dacoits, Drug Offenders, Goondas, Immoral Traffic Offenders and Land Grabbers Act, 1986.
HELD THAT:- A reading of the provisions makes it clear that the State Government, District Magistrate or Commissioner of Police are the authorities, conferred with the power to pass orders of detention. The only difference is that the order of detention passed by the Government would remain in force for a period of three months in the first Instance, whereas similar orders passed by the District Magistrate or the Commissioner of Police shall remain in force for an initial period of 12 days. The continuance of detention beyond 12 days would depend upon the approval to be accorded by the Government in this regard. Sub-section (3) makes this aspect very clear. Section 13 of the Act mandates that the maximum period of detention under the Act is 12 months.
Where the law prescribes a thing to be done in a particular manner following a particular procedure, it shall be done in the same manner following the provisions of law, without deviating from the prescribed procedure. When the provisions of Section 3 of the Act clearly mandated the authorities to pass an order of detention at one time for a period not exceeding three months only, the Government Order in the present case, directing detention of the husband of the Appellant for a period of twelve months at a stretch is clear violation of the prescribed manner and contrary to the provisions of law. The Government cannot direct or extend the period of detention up to the maximum period of twelve months, in one stroke, ignoring the cautious legislative intention that even the order of extension of detention must not exceed three months at any one time. One should not ignore the underlying principles while passing orders of detention or extending the detention period from time to time.
Passing a detention order for a period of twelve months at a stretch, without proper review, is deterrent to the rights of the detenu. Hence, the impugned Government Order directing detention for the maximum period of twelve months straightaway cannot be sustained in law.
The detention order passed by the Government of Andhra Pradesh in this case is in contravention to the provisions of law - Appeal allowed.
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2014 (5) TMI 1226
Direction to make payment of the service tax component of the monthly rentals - HELD THAT:- In view of the decisions of the Supreme Court in the case of ABL INTERNATIONAL LTD. & ANR. VERSUS EXPORT CREDIT GUARANTEE CORPORTION OF INDIA LIMITED & ORS. [2003 (12) TMI 584 - SUPREME COURT] and in the case of HARBANSLAL SAHNIA AND ANR. VERSUS INDIAN OIL CORPN. LTD. AND ORS. [2002 (12) TMI 564 - SUPREME COURT], the point as to whether a writ petition impeaching contractual obligations despite availability of a forum for resolution of disputes and differences by arbitration would be maintainable, is no longer res integra. The facts surfacing from the writ petition do not require investigation into any disputed question of fact; rather the point involved is simple,-who between the first petitioner and the respondents, in terms of the agreement between the parties, is liable to bear the service tax.
Insofar as the decision in BHAGWATI SECURITY SERVICES (REGD.) VERSUS UNION OF INDIA [2013 (11) TMI 649 - ALLAHABAD HIGH COURT] is concerned, it appears that a writ petition was presented before the Allahabad High Court by the petitioner against Union of India and the BSNL authorities. Under the agreement, security services were to be provided to the respondent no. 2. Service tax was demanded but was denied on the ground that the same was not contemplated in the agreement.
Turning to the facts of the present case, it appears that clause 6 extracted supra delineated the respective obligations of the lessor and the lessees. The parties agreed that the rates and taxes primarily leviable upon the occupier would be paid by the Government. That the respondents were not oblivious of their obligation to bear service charge is reflected from the letter dated April 30, 2012 - it is not a case that if obligation to make payment of service tax arises, the respondents would have discretion to foist the responsibility on the lessor (the first petitioner). Liability to bear service tax being that of the person receiving service, there can be no escape from the conclusion that the respondents are liable to bear service tax.
The first petitioner is entitled to writs/orders in terms of prayers 'a' and 'b' extracted supra, with the only modification in regard to the rate of interest i.e. interest @ 10% instead of 18% - Petition allowed.
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2014 (5) TMI 1225
Accrual of income - Derecognition of interest on accrual basis on Non-Performing Assets (NPAs) - HELD THAT:- As the question of law is covered against the Revenue by two decisions, i.e. CIT v. Vasisth Chay Vyapar Ltd. and Anr. [2010 (11) TMI 88 - DELHI HIGH COURT] and DIT v. Brahmaputra Capital Finance Ltd. [2011 (5) TMI 321 - DELHI HIGH COURT]
Provision for doubtful debts for NPAs - As far as the second aspect goes, we notice that the Revenue had succeeded before the ITAT in light of the judgment of the Supreme Court in Southern Technologies Ltd. [2010 (1) TMI 5 - SUPREME COURT] - The Revenue is not in appeal in respect of that question. Following the decision in Vasist Chay Vyapar Ltd. (supra) and Brahmaputra Capital Finance Ltd. (supra), the question of law urged by the Revenue is answered against it and in favour of the assessee.
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2014 (5) TMI 1224
Assessment framed u/s 158BC - Deposits made in the bank accounts against sale of shares - HELD THAT:- We have already upheld the addition of Rs. 38,099/- and also are in conformity with the order of CIT (Appeals) with regard to Rs. 30,000/-. The addition of Rs. 33,000/- in the hands of the assessee is also justified in the absence of any proof being filed by the assessee with regard to the availability of the cash in hand. In addition to the three additions upheld by the Commissioner of Income Tax (Appeals), we further uphold the addition relatable to the deposits made in the bank accounts against sale of shares totaling Rs. 141,667/-. In view thereof, we partly allow the ground of appeal No. 1 raised by the revenue.
Cash deposits in the bank account which was claimed to be out of tuition fee - HELD THAT:- By rejecting the plea of the assessee that it had made cash withdrawals on earlier dates and the said cash was available with the assessee. Consequently, ground Nos. 3, 4 and 5 raised by the assessee are dismissed.
Unexplained investment in the property - HELD THAT:- The assessee claimed that regarding its income for the year 1996-97 was more than its outgoing and in view of the assessee having spent Rs. 56,302/- against bills on various dates, no addition was made by the Commissioner of Income Tax (Appeals). We are in conformity with the order of the Commissioner of Income Tax (Appeals) in this regard specially after the verification exercise carried out by the Commissioner of Income Tax (Appeals) during the appellate proceedings. Upholding the order of Commissioner of Income Tax (Appeals) we dismiss ground No. 2 raised by the revenue.
Unexplained investment of FDR in the name of the wife of the assessee - HELD THAT:- Commissioner of Income Tax (Appeals) accepted the plea of the assessee in view of the said withdrawals which had been verified by the Assessing Officer and also in view of the approximate income of Rs. 75,000/- from different sources being available with the assessee. The ld. DR for the revenue has failed to controvert the findings of Commissioner of Income Tax (Appeals) and in view thereof, we find no merit in ground No. 3 raised by the revenue.
Unexplained investment in the purchase of household items - HELD THAT:- Addition was deleted by the Commissioner of Income Tax (Appeals) as approximately Rs. 70,000/- for the purchase of various items was paid through cheques and balance amount was held to be out of the known sources of income. We find no merit in ground No. 4 raised by the revenue in this regard in view of the abovesaid facts and circumstances and same is dismissed.
Investment in purchase of cars - HELD THAT:- In Remand proceedings, remand report was called for and the Assessing Officer accepted the payment of Rs. 107,109/- paid towards the purchase of Maruti car and the said investment was treated as explained. With regard to the second Maruti car, it was noted by the Commissioner of Income Tax (Appeals) that the new car was purchased on 11.09.1996 and the old car was sold on 08.12.1996 hence, the new car being purchased before the sale of the old car, does not justify the claim of the assessee and an addition of Rs. 77,153/- was upheld in this regard. In the totality of the facts and circumstances and in view of the remand report, we find no merit in the ground of appeal No. 5 raised by the revenue and the same is dismissed. We also find no merit in the issue raised by the assessee vide ground No. 6 where the old car was sold later than the date of purchase of the new car and consequently, the said sale proceeds of old car not being available with the assessee, the claim in this regard was not justified. We uphold the addition of Rs. 77,153/- and dismiss ground No. 6 raised by the assessee.
Investment in purchase of jewellery - HELD THAT:- The assessee had purchased an item of jewellery from the jewellery and the Assessing Officer had made the addition in the absence of any explanation of sources of investment. The Commissioner of Income Tax (Appeals) deleted the addition because of the salary drawn by the assessee. In the entirety of the abovesaid facts and circumstances, we find no merit in ground No. 6 raised by the revenue.
Unexplained investment in plot - HELD THAT:- In the absence of any details, the cost of acquisition of the plot was taken at 'nil' by the Assessing Officer and the entire sale consideration was treated as income from capital gains. The Commissioner of Income Tax (Appeals) noted that in the remand proceedings vis-à-vis the various bank deposits, the Assessing Officer has noted that Rs. 30,000/- had come from sale proceeds of the above land which was purchased in the year ending 31.3.1987. The loss on the sale of the plot was claimed at Rs. 5,000/- as the assessee had shown the cost at Rs. 35,000/-. In view thereof, the addition was deleted by the Commissioner of Income Tax (Appeals). We find no error in the order of the Commissioner of Income Tax (Appeals) and upholding the same, we dismiss ground No. 7.
Addition made in the hands of the assessee on account of a hand written document found during the course of search which reflected that the assessee had sold property - HELD THAT:- Where the document was found from the possession of the assessee, the presumption is that the said document belongs to the assessee and the onus is upon the assessee to explain the nature of the document. In the instant case, the hand written document found from the possession of the assessee was claimed to be a dumb document as no proof of the property or date of the transaction was mentioned in said property - no evidence was found by the Department to establish its case of transfer of remittance of Rs. 10 lacs to London.
In the absence of any corroborative evidence found to establish that the assessee as owner of any property, had sold the said property or his share in property for a sum no addition on the basis of such document, which clearly is a dumb document, could be made in the hands of the assessee. Upholding the order of Commissioner of Income Tax (Appeals), we dismiss the ground of appeal No. 8 raised by the revenue.
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2014 (5) TMI 1223
Default u/s 201(1) and 201(1A) - Alternate remedy - as argued 15% trade discount allowed by the petitioner to the advertising agencies was not payment of commission within the meaning of section 194H therefore, the authorities had no jurisdiction to initiate proceedings under sections 201(1)/201(1A) - HELD THAT:- We are not inclined to entertain this petition as the petitioner has a statutory alternative remedy of filing an appeal before the CIT and a further appeal to the Income Tax Appellate Tribunal, if required. In the judgment rendered in Jagran Prakashan [2012 (5) TMI 488 - ALLAHABAD HIGH COURT] the notice issued to the petitioner was in respect of section 194H alone. In the present case, as noticed above, apart from section 194H, the notice was issued under various other provisions of the Act. The impugned order elaborately deals with each of the provisions and has found that the assessee has failed to deduct TDS under each of these heads.
As various factual aspects relating to the imposition of duty under these sections have been raised in this petition, we do not consider it appropriate to entertain this petition as the petitioner has available the statutory alternative remedies.
Though it has been contended by petitioners that the principles of natural justice have been violated as adequate opportunity has not been given to the petitioner, but we find from the records that a notice had been issued to the petitioner to which he had submitted a reply. It cannot be urged that there has been a breach of the principles of natural justice.
The Supreme Court in Commissioner of Income Tax & Ors. Vs. Chhabil Dass Agarwal [2013 (8) TMI 458 - SUPREME COURT] has held that as the Income Tax Act provides for a complete machinery against orders passed by the Revenue authorities, an assessee should not ordinarily be permitted to abandon that machinery and invoke jurisdiction of the High Court under Article 226.
In the instant case, the Act provides complete machinery for the assessment/re-assessment of tax, imposition of penalty and for obtaining relief in respect of any improper orders passed by the Revenue Authorities, and the assessee could not be permitted to abandon that machinery and to invoke the jurisdiction of the High Court under Article 226 of the Constitution when he had adequate remedy open to him by an appeal to the Commissioner of Income Tax (Appeals). The remedy under the statute, however, must be effective and not a mere formality with no substantial relief. In Ram and Shyam Co. vs. State of Haryana, [1985 (5) TMI 213 - SUPREME COURT] this Court has noticed that if an appeal is from "Caesar to Caesar's wife" the existence of alternative remedy would be a mirage and an exercise in futility.
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