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Showing 1 to 20 of 1255 Records
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2015 (5) TMI 1267
Seeking condonation of delay of 771/119 days in filing appeal - Beneficiation of coal activity - Business auxiliary services - it was held by CESTAT that 'The said activity is so integrally connected with the activity of beneficiation of coal that the same cannot be segregated and it cannot be held that the same was a different and separate activity falling under the definition of cargo handling services in as much' - HELD THAT:- There is enormous delay of 771/119 days in filing/refiling of the civil appeal, which has not been satisfactorily explained.
The civil appeal is dismissed on the ground of delay.
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2015 (5) TMI 1266
Payment of Salary Without a Sanctioned Post - Whether a direction can be issued for payment of salary under Article 226 of the Constitution of India in the absence of a sanctioned post? - HELD THAT:- The mere fact that recognition has been granted to an institution or, for that matter, for conducting a new course or subject or for an additional section, would not give rise to a presumption of a financial sanction having been granted to the creation of a post. A financial liability cannot be foisted on the State to reimburse the salary payable to the employee or the teacher on the basis of such a presumption. For the purpose of creating a new post of a teacher or other employee, the management has to obtain the prior approval of the Director as required under Section 9 of the Act 1971. Without the prior approval of the Director, a new post cannot be sanctioned or created. Section 9 is mandatory.
In the absence of a sanctioned post, a direction cannot be issued to the state in the exercise of powers under Article 226 of the Constitution for the payment of salary - In the absence of a sanctioned post, the High Court under Article 226 of the Constitution would not be justified in issuing a mandamus for the payment of salary, particularly since a mandamus cannot lie in the absence of a legal right, based on the existence of a statutory duty.
The reference to the Full Bench stands answered accordingly. The special appeal shall now be placed before the Division Bench for disposal in the light of this judgment.
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2015 (5) TMI 1265
Market manipulation and fraudulent Share trade practices -preferential allotment of shares to generate fictitious long-term capital gains (LTCG) - significant increase in the price of the scrip took place and the price was maintained during the period of lock in on the shares allotted to the preferential allotees - HELD THAT:- The entire modus operandi of allotting shares on a preferential basis, announcing a stock split and then bringing in connected entities to provide exit was a scheme devised to make ill-gotten gains. The modus operandi of pumping the share price artificially and then dumping the price so that the same cycle could be repeated, demonstrates the mala fide of the Pine Group. Also the mechanism is presumably being used to deceive the authorities by laundering black money and making tax-free profits.
Further, from the copies of the special resolution, passed under section 81(1A) of the Companies Act, 1956 as available on BSE website it is noted that Pine had disclosed to its shareholders and public that the purpose of aforesaid fund raising through preferential allotment was to fulfil the additional funding requirements of the company for acquisition and development of moveable and immovable property.
From the bank statement analysis of Pine, it is observed that funds received as proceeds of preferential allotment were immediately transferred to various entities on the same day or in a matter of next three days and was never retained in the company for executing its plans as envisaged in the special resolution passed under section 81(1A) of the Companies Act, 1956.
Preferential allotment was used as a tool for implementation of the dubious plan, device and artifice of Exit Providers, Preferential Allottees and Promoter related entities. One could argue that in order to make LTCG, the Preferential Allottees in question could have bought in secondary market and waited for a year before selling the shares.
In the instant case, probably the preferential allotment route was preferred over secondary market route because the share capital of Pine prior to preferential allotment was very small i.e. 30,00,000 shares to accommodate the required fictitious LTCG of ₹ 453 crore approximately. As such the capital expansion through preferential allotment and stock split provided much bigger source to the persons involved in terms of volume and price manipulation to facilitate the whole operation. Further, the entire scheme of operation also helped the promoters of Pine to exit from the company.
The prima facie modus operandi appears to be same as that used in the matter of Radford Global Limited where the stock exchange mechanism was used for the purpose of availing LTCG tax benefit and Pine was found actively involved in the whole design to misuse stock exchange mechanism to generate bogus LTCG.
The scheme, plan, device and artifice employed in this case, apart from being a possible case of money laundering or tax evasion which could be seen by the concerned law enforcement agencies separately, is prima facie also a fraud in the securities market in as much as it involves manipulative transactions in securities and misuse of the securities market. The manipulation in the traded volume and price of the scrip by a group of connected entities has the potential to induce gullible and genuine investors to trade in the scrip and harm them. As such the acts and omissions of Exit Providers, Preferential Allottees and Promoter related entities are ‘fraudulent’ as defined under regulation 2(1)(c) of the SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 2003 (‘PFUTP Regulations’) and are in contravention of the provisions of Regulations 3(a), (b), (c), (d), 4(1), 4(2)(a), (b), (e) and (g) thereof and section 12A(a), (b) and (c) of the Securities and Exchange Board of India Act, 1992.
Considering indulgence of a listed company in such a fraudulent scheme, plan, device and artifice as prima facie found in this case, I am convinced that this is a fit case where, pending investigation, effective and expeditious preventive and remedial action is required to be taken by way of ad interim ex -parte in order to protect the interests of investors and preserve the safety and integrity of the market.
It is also pertinent to mention that vide SEBI's Orders in the matter of Radford Global Ltd and First Financial Services Ltd., Pine itself has been restrained from buying, selling or dealing in the securities market, till further directions and the said restraint is in operation as on date.
As an interim, preventive and remedial measure and to maintain orderly development in the securities market, in the interests of securities market and investors, it would also be necessary to take immediate steps regarding trading in the scrip of Pine on the stock exchange.
Considering these facts and the indulgence of a listed company in such a fraudulent scheme, plan, device and artifice as prima facie found in this case, we are convinced that this is a fit case where, pending investigation, effective and expeditious preventive and remedial action is required to be taken by way of ad interim ex -parte in order to protect the interests of investors and preserve the safety and integrity of the securities market.
Restrain orders on persons/entities from accessing the securities market and buying, selling or dealing in securities, either directly or indirectly, in any manner.
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2015 (5) TMI 1264
Condonation of delay in filing appeal u/s 5 of the Limitation Act - whether an appeal under S. 21 of the National Investigation Agency Act, 2008 (NIA Act) can be validly filed before the High Court after the expiry of the period of ninety days from the date of judgment, sentence or order appealed from? - HELD THAT:- The N.I.A. Act is an Act to constitute an investigation agency at the national level to investigate and prosecute offences affecting the sovereignty, security and integrity of India, security of State, friendly relations with foreign States and offences under Acts enacted to implement international treaties, agreements, conventions and resolutions of the United Nations, its agencies and other international organizations and for matters connected therewith or incidental thereto. The superintendence of the N.I.A. shall vest in the Central Government, as provided in S. 4 of the N.I.A. Act. S. 6 provides for investigation of scheduled offences. S. 7 provides that the N.I.A. may request the State Government to associate itself with the investigation. S. 9 mandates that the State Government shall extend all assistance and co-operation to the Agency for investigation of the scheduled offences.
The period of limitation provided under sub-section (5) of S. 21 is thirty days. The first proviso to sub-section (5) empowers the High Court to entertain an appeal after the expiry of thirty days, if it is satisfied that the appellant has sufficient cause for not preferring the appeal within the period of thirty days. The second proviso provides that no appeal shall be entertained after the expiry of the period of ninety days. The first proviso to sub-section (5) of S. 21 itself deals with condonation of delay in filing appeal and the delay up to sixty days (ninety days from the date of order) can be condoned by the High Court. By making a restriction that no appeal shall be entertained after the expiry of the period of ninety days, the application of S. 5 of the Limitation Act is expressly excluded. The High Court has jurisdiction to condone the delay in filing the appeal. But that power is restricted under the first proviso to sub-section (5) of S. 21. A further restriction in the second proviso is a clear indication that the High Court cannot exercise the power under S. 5 of the Limitation Act to condone the delay. To that extent, it amounts to an express exclusion of S. 5 of the Limitation Act as contemplated under S. 29(2) of the Limitation Act.
Conclusion - The appeal filed after ninety days was dismissed as not maintainable.
Appeal dismissed.
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2015 (5) TMI 1263
Rejection of appellant’s application to be treated as a first charge holder/secured creditor pari-passu - dismissal of application on the ground that the appellant’s charge had not been registered under section 125 of the Companies Act, 1956 - HELD THAT:- It is important to note that the Assistant General Manager of the Ist respondent in a letter dated 17.05.1999 addressed to the Official Liquidator stated that respondent Nos.2 to 4 as well as the four insurance companies had a pari-passu first/exclusive charge on the company’s fixed assets. The letter admitted that the aggregate principal amount due to the four insurance companies is Rs. 200 lacs. This admission stands. It has never been contended that it was a mistake or made under a mistaken impression.
The respondent Nos.1 and 2 do not state that the charge had not been registered. They merely state that the appellant has not been able to establish that the charge was registered. Absent any indication to the contrary, and there is none, it must be presumed that the charge was registered. Admittedly, the charge was created. In any event, it is clear beyond doubt from the above facts that it was. Reference made to the documents and specifically Form No. 8 which establishes that respondent No.1 had submitted the necessary documents for registration in accordance with Section 125 of the Act. It is inclined to presume that the authorities concerned in the Registrar of Companies fulfilled the statutory obligation of registering the charge. There was no legal bar to the charge being registered.
The impugned order and judgment are setaside. It is declared that the appellant holds a pari-passu charge as claimed by it and shall be entitled to a pro-rata distribution of the sale proceeds after making necessary deductions therefrom - Application allowed.
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2015 (5) TMI 1262
Jurisdiction - power of respondent No.2 u/s 22 of the Companies Act to direct the appellant Company to delete the word “VARDHAMAN” from its existing name - HELD THAT:- The power under Section 22 of the Companies Act is an independent power provided to the Central Government, and the remedy of filing suit for injunction restraining the defaulting company from using its registered trade name and mark is a different remedy available to the aggrieved company. The learned Single Judge, while relying upon a judgment of the Karnataka High Court in Surya Elevators and Escalators India Private Limited, Bangalore Vs. Union of India and others [2012 (9) TMI 1256 - KARNATAKA HIGH COURT], has rightly held that remedy under Section 22 of the Companies Act was not barred once the respondent Company had taken remedy of common civil law.
Under Section 22 of the Companies Act, the Central Government has no jurisdiction to grant injunction against the use of an undesirable name by a company, whereas in a suit for permanent injunction the Court cannot pass an order as could be passed under Section 22 of the Companies Act by the Central Government, directing the offending company to delete the registered trade mark of the previously registered company from its name. The jurisdiction of the Central Government under Sections 20 and 22 of the Companies Act and the jurisdiction of the Civil Court operate in two different fields - Thus, there are no force in the first contention raised by learned counsel for the appellant Company.
The second contention raised by learned counsel for the appellant Company that in the facts and circumstances of the case, by its conduct, waiver or acquiescence, the respondent Company be estopped from getting the word “VARDHAMAN” deleted from the existing name of the appellant Company, is also not sustainable.
The third contention raised by learned counsel for the appellants is also without any substance. Whether in a given case, the act and conduct of registration of a company with a particular name is undesirable or not, is a question of inference. On the basis of the proven fact, the said inference can be drawn. Therefore, the contention that in the order passed by respondent No.2, it was not recorded that the act of the appellant Company in using the registered trade mark of the respondent Company, was undesirable has no effect. In the facts and circumstances of the instant case, it has been proved that the appellant Company got itself incorporated with the name “M/s Vardhaman Crop Nutrients Private Limited”, which was identical to the already incorporated respondent Company; that “VARDHAMAN” was already registered trade mark of the respondent Company; and that both the companies are dealing in the same business - On the basis of these facts, inference could have been drawn that the act of the appellant Company was undesirable. Thus, there are no force in this contention.
In support of the fourth contention that there are 401 different Companies registered under the Companies Act with the Registrar of Companies with the name “VARDHAMAN”, learned counsel for the appellants has drawn our attention to the list of 401 Companies, annexed with the writ petition as Annexure P-22. This contention is also devoid of any merit, because out of this list, only the appellant and the respondent Company are engaged in the business of manufacturing and marketing Class I fertilizers, water soluble fertilizers and micro nutrients - In the present case, the respondent Company had filed application under Section 22 of the Companies Act only against the appellant Company. On that application, respondent No.2, after satisfying himself that registration of the appellant Company is undesirable, directed the appellant Company to delete the word “VARDHAMAN” from its existing name. Thus, there are no illegality in the said direction issued by respondent No.2.
There are no merit in the instant appeal - appeal dismissed.
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2015 (5) TMI 1261
Oppression and mismanagement - Maintainability of the petition under Sections 397 and 398 of the Companies Act, 1956 - Respondent no. 1/ petitioner is neither the member nor a share holder in the appellants-companies - arguments raised by learned counsel for the appellants is that application can be filed under Sections 397 or 398 of the Act only against “the company”, whose affairs are to be seen by the Board, whether being oppressive against any member or share holder or the same being mismanaged - HELD THAT:- While dealing with the petition under Sections 397-398 of the Act, the Board can even terminate, set aside or modify any agreement between the company and the managing director, director, manager or any other person and can even delete or modify any Article of the company. The other respondents impleaded in the petition filed before the Board besides the company, namely, Perpetual, are certainly the necessary parties. The principles of holding and subsidiary company are applicable in a case where the affairs of the company are to be gone into, as it can be stretched only upto a subsidiary company. The prayer of CPI before the Board is not to go into the affairs of the parties impleaded before it, besides the company i.e. Perpetual, whose affairs are to be gone into, rather these have been impleaded for the reason that the dealings of the company with other parties impleaded in the petition before the Board may have to be gone into and in case those transactions are reversed, they may have to be issued some directions. It was to observe principles of natural justice. Hence, to plead that they are not necessary parties, is misconceived, hence, rejected.
As far as challenge to the interim order passed by the Board directing audit of Triangle is concerned, there are no reason to interfere in that part of the order. CPI being a foreign investor invested huge fund in Perpetual. The money was siphoned off from Perpetual to Triangle and other group companies with no track to CPI. The project for which the money was invested never took off. Justification is being given by the appellants companies before this Court in which the investments were made by Perpetual that it was in terms of decision taken by the Board of Directors of Perpetual.
The appeals are dismissed.
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2015 (5) TMI 1260
Refusal to entertain an application for suspension of proceedings before the Debt Recovery Tribunal (DRT) - Section 17 of the Sick Industrial Companies (Special Provisions) Act, 1985 - HELD THAT:- It is evident from a plain reading of Section 17 of the SICA that upon receiving a reference, BIFR is authorised to consider if and to what extent a sick company can be rehabilitated. As a first step in doing so, it could take recourse to the power enumerated under Section 17(2). That authorises BIFR, with the consent of the secured creditors entitled to claim amounts and assets of the sick company – to draw a rehabilitation package and place mechanisms for a limited duration. It is in the event of failure of this exercise or if in the first instance under Section 17(1) BIFR feels that it is not possible to revive the company within the existing parameters, that under Section 17(4), it proceeds to take the measures which ultimately culminate in a rehabilitation scheme under Section 18(1). The facts discussed in the present case clearly demonstrate that BIFR was to first explore the possibility of revival of the company by issuing the directions it did on 27.12.1999. The order no doubt refers to a package – but that is not in the sense as understood in Section 18(1). It is not the case of the parties that draft rehabilitation scheme was ever circulated, considered, objected to, revised or finally sanctioned by BIFR.
This Court cannot fault the DRAT’s reasoning that there was no rehabilitation package pending for monitoring by the BIFR which acted as an embargo by Section 22 of SICA. The arguments with respect to the operation or application of third proviso to Section 15(1) of SICA, do not arise since the first essential condition for its applicability was pending reference or any sanctioned scheme subject to BIFR. Having concluded that no such reference or scheme existed, there was no question of operation or applicability of Section 15 in the circumstances of the case.
The petition is unmerited and accordingly dismissed.
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2015 (5) TMI 1259
Validity of notices issued u/s 143(2) - lack of jurisdiction and as barred by time - HELD THAT:- While the notice dated 06.08.2013 was issued within time, it was issued by ACIT, Circle 31(1), who admittedly did not have jurisdiction in this matter. Therefore, the said notice dated 06.08.2013 is to be rejected on the ground of want of jurisdiction. Insofar as the notice dated 23.12.2014 is concerned, it was issued by the officer having jurisdiction namely, the ACIT, Circle 50(1) but that has been issued much beyond the period of limitation which expired on 30.09.2013. Therefore, the notice dated 23.12.2014 is barred by time.
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2015 (5) TMI 1258
Police custody beyond remand period - Relevant date from which date the first period of fifteen days mentioned in Section 167(2) of the Cr.P.C. is to be computed - HELD THAT:- In the case in hand, the Additional Superintendent of Police, CBI, SCB (SIT), Kolkata effected arrest of the accused. Therefore, it is his duty to take or send the person arrested before the Magistrate having jurisdiction in the case. Section 57 Cr.P.C. commands that no police officer shall detain in custody a person arrested without warrant for a long period exceeding twenty four hours which period is exclusive of the time necessary for the journey from the place of arrest to the Magistrate. The only relaxation for production of the arrested accused within twenty four hours contained in Section 57 Cr.P.C. is in case the Magistrate under Section 167 Cr.P.C. by special order authorized the police officer to detain such person for a period of more than twenty four hours.
In case an arrested accused person acquired any health problem after his arrest, then it is for the police officer to produce the accused before the Magistrate within twenty four hours after obtaining Medical Certification of the accused from a Government Doctor and thereafter it is for the Magistrate who after authorising the custody of the accused to this specified authority under Section 167(2) Cr.P.C. to take a decision and to give a direction either to prison authorities in case the accused is authorised to be detained in prison or to the police authorities in case the accused is authorized to be detained in police custody, for getting necessary medical aid and to provide necessary medical facilities to the accused so detained. It is not for the police officer to admit the accused in a hospital and to violate legal and constitutional mandate of production of the arrested accused before the Magistrate within twenty four hours of his detention under arrest.
Such action on the part of the police officers is likely to lead unscrupulous tendencies like in the present case, where the accused was allowed to remain in hospital from 31.01.2015 to 06.02.2015 after his arrest without production before a Magistrate, till the accused was declared fit by the hospital authorities and he was produced on 07.02.2015. Such activity on the part of the police officers will give wrong signals to the society and to the public at large that rich and influential person can manage unscrupulous police officers, so that they need not go either to a Court or to a prison even after arrest while in custody. The said C.B.I. Officer prima-facie committed a Constitutional violation in not producing the accused before the Magistrate within twenty four hours of his arrest. His action/inaction in this regard is highly deplorable.
The remand order passed by the jurisdiction Magistrate alone has to be legally considered as first remand for all the practical purposes. In the case of CBI v. Anupam J. Kulkarni [1992 (5) TMI 191 - SUPREME COURT] the Hon'ble Supreme Court has clearly laid down that the period of 90 days or 60 days has to be computed from the date of detention as per the orders of the Magistrate and not from the date of arrest by the police. Consequently the first period of fifteen days mentioned in Section 167(2) has to be computed from the date of such detention and after the expiry of the period of first fifteen days it should be only judicial custody. In the instant case the Learned Magistrate passed the remand order on 01.02.2015 sending the accused into the judicial custody till 13.02.2015. Therefore, the impugned order passed on 15.02.2015 remanding the petitioner/accused to police custody till 21.02.2015 is beyond the first remand period of fifteen days. Therefore, such order is absolutely illegal and cannot be sustained.
This Court is of the firm view that the police custody cannot be ordered in any circumstances beyond the first remand period of fifteen days. In such view of the matter the impugned order under challenge is liable to be set aside and accordingly it is set aside.
Revision allowed.
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2015 (5) TMI 1257
Maintainability of appeal - appropriate forum - classification of goods - HELD THAT:- Since the subject matter does not pertain to classification of goods, appeal against the order of the Customs, Excise and Service Tax Appellate Tribunal is maintainable before the High Court under Section 35G of the Central Excise Act and not before this Court.
These appeals are, accordingly, dismissed, with liberty to the Revenue to file appropriate appeal before the High Court.
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2015 (5) TMI 1256
Bogus creditors - addition in respect of sundry creditors unexplained - CIT(A) deleted the addition - HELD THAT:- No illegality and infirmity has been committed by the CIT(A) in deleting the addition of sundry creditors, which did not arise during the impugned assessment order in their opening balance from the earlier assessment year 2005-06.
As per the provisions of section 68, any amount found credited in the books of assessee can be added in the previous year relevant to the assessment year, in case, the assessee fails to prove the nature and source of such credit, in which these amounts arose are credited. Since the amounts were not credited in the impugned A.Y., therefore, in view of the decision of Sridev Enterprises [1991 (1) TMI 52 - KARNATAKA HIGH COURT] we confirm the order of the CIT(A) deleting the said addition.
Bogus purchase - Notice issued u/s 133(6) was sent, which was returned unserved - CIT(A) deleted the addition - HELD THAT:- As noted that in this case the sales shown by the assessee has duly been accepted by the AO. In our opinion, the assessee cannot make the sales until and unless the purchase has been made by the assessee. AO has not rejected the books of accounts but made the addition towards the bogus purchase. The payment has been made to these parties in the subsequent year, which has not been dispatched by the Revenue. It is not a case where the accounts has been rejected or the profit has been estimated. We, therefore, do not find that it is a fit case, which warrants our interference. We accordingly confirm the order of the CIT(A) deleting the addition.
Appeal filed by the Revenue is dismissed.
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2015 (5) TMI 1255
Illegal Gratification - Bribe - rebuttal of presumption - conviction Under Sections 7 and 13(1)(d) read with Section 13(2) of Prevention of Corruption Act - HELD THAT:- Mere recovery of the tainted amount is not a sine qua non for holding a person guilty Under Sections 7, 11 and 13 of the Act. This Court has observed in NARENDRA CHAMPAKLAL TRIVEDI & HARJIBHAI DEVJIBHAI CHAUHAN VERSUS STATE OF GUJARAT [2012 (5) TMI 603 - SUPREME COURT], that there has to be evidence adduced by the prosecution that bribe was demanded or paid voluntarily as bribe. The demand and acceptance of the amount as illegal gratification is a sine qua non for constituting an offence under the Prevention of Corruption Act. The prosecution is duty bound to establish that there was illegal offer of bribe and acceptance thereof and it has to be founded on facts.
In the present case the factum of demand and acceptance has been proved by the recovery of the tainted amount and the factum of there being a demand has also been stated. The essential ingredient of demand and acceptance has been proved by the prosecution based on the factum of the case. It has been witnessed by the key eye witnesses and their testimonies have also been corroborated by other material witnesses. The offence Under Section 7 of P.C. Act has been confirmed by the unchallenged recovery of the tainted amount. Thus, it is the obligation to raise the presumption mandated by Section 20 of P.C. Act. It is for the accused Respondent to rebut the presumption, by adducing direct or circumstantial evidence, that the money recovered was not a reward or motive as mentioned Under Section 7 of the P.C. Act.
Thus, the accused Respondent has not successfully rebutted the presumption Under Section 20 of the P.C. Act. The prosecution, on the other hand, has established the demand and acceptance of the tainted money. The recovery also has gone unchallenged.
The appeal is allowed.
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2015 (5) TMI 1254
Correct head of income - Taxing the rental income from property - income from house property or Income from other sources - real owner of property - assessee stated to have been received property as gift from her father - AO did not accept the ownership of flat of the appellant therefore, assessed the receipt of stated rent under the head "Other Sources" and disallowed statutory deduction u/s 24 (30% towards repairs) and payment of Municipal taxes - According to the ld CIT(A) the transfer of the house property is not in accordance with law because the Gift Deed of immovable property was not registered by payment of stamp duty
HELD THAT:- As decided by Smt. Kamla Sondhi [2004 (2) TMI 741 - DELHI HIGH COURT] under the common law, owner means a person who has got valid title legally conveyed to him after complying with the requirements of law such as the Transfer of Property Act, Registration Act, etc. But, in the context of section 22 of the Income Tax Act, having regard to the ground realties and further having regard to the object of the Income Tax Act, namely, to tax the income, we are of the view, owner is a person who is entitled to receive income from the property in his own right.
We find that the Ld CIT(A) got carried away by the judgment of Suraj Lamps and Industries Pvt. Ltd. (2011 (10) TMI 8 - SUPREME COURT), wherein, SC delivered the judgment in a different context and highlighted the well settled law on the importance of registration of property as per the Registration Act and frowned upon the menace of transaction being done of immovable property by General Power of Attorney and the said case has nothing to do with the Income Tax Act 1961, which we are dealing with. However we find that the aforesaid order of the Hon’ble High Court of Delhi bolsters the case and claim of the appellant.
Since there is no dispute that income/rent from the flat No-21, Hope Apartments, Sector-15, Gurgaon is received by the assessee/ appellant then as per the Income Tax Act, owner is the person who is entitled to receive income in his own right. Respectfully following the order of the Hon’ble High Court in the case of CIT vs. Smt. Kamla Sondhi (Supra) as held by the Hon’ble Supreme Court in Poddar Cement (supra), we set aside the order of the revenue authorities and decide the issues in dispute in favour of the assessee.
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2015 (5) TMI 1253
Estimation of income - bogus purchases - HELD THAT:- We are not inclined to grant adjournment and inasmuch as before the Hon’ble High Court, whether the question of law has been admitted, stage of hearing and likelihood of time of decision has not been explained to us. It will be expedient that instead of mounting the pendency before ITAT and refixing these appeals again and again, the AO will take a view in this matter in consonance with the Hon’ble Rajasthan High Court’s judgment. It will avoid repeated fixation and unnecessary pendency before the ITAT inasmuch as the Hon’ble Rajasthan High Court judgment will be binding on all concerns. In view thereof, we reject the adjournment application. After hearing the ld DR, perusing the material available on the record, we set aside the matter back to the file of Assessing Officer to decide the same.
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2015 (5) TMI 1252
Revision u/s 263 - Non application of mind to the material available on record by AO - Commissioner found that the assessee claimed Duty Drawback from income, payment of sales commission, payment of cash exceeding ₹ 20,000/-, VAT returns, charity and donation, job work charges as expenses in the return of income, but AO has not made any reference in the assessment order about all its genuineness or allowability of the claim - HELD THAT:- The assessment proceeding before the AO is a judicial proceeding u/s 136. Therefore, AO is bound to pass a speaking order. Reason for conclusion reached shall be reflected in the assessment order itself. AO is expected to dispose the issues raised by the assessee and record his own reasoning for allowing or disallowing the claim of the assessee, in accordance with law. The order of the AO is subject to further appeal/revision before the higher authorities. In this case, admittedly, the AO has not discussed anything in the assessment order regarding issues raised by the Commissioner. Hence, it shows non- application of mind by the Assessing Officer.
Therefore, recording of the reasons is all the more mandatory for the appellate/revisional authorities to appreciate the reasons for the conclusions reached by the AO in his order. It is a well settled principle of law that the reasons for conclusion reached in a judicial order shall contain in the impugned order itself. In other words, reason for the conclusion arrived in a judicial/administrative order cannot be substituted by way of filing additional document or affidavit before the higher forums. Appeal of the assessee is dismissed.
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2015 (5) TMI 1251
Determination of the head of income - profits arising from the transfer of lands as per the development agreements and sale of flats/bungalows allotted by the developer in lieu of or as consideration for transfer of land - intention behind the entire transaction on the part of the assessee - HELD THAT:- In the present case, there was not only conversion by the assessee company of land held as capital asset till the date of development agreement into stock in trade, but there was also a change in the form of capital asset in as much as in lieu 73% of the land area, what the assessee company got on conversion was 27% of the total built up area of the project. The remaining 27% of the land area continued to be held by the assessee company, but as stock in trade on conversion. Thus, as a result of development agreement, there was conversion of capital asset into stock in trade as well as change in the form of asset in the sense that in place of 100% land area held as capital asset, the assessee company got 27% of the total built up area of the project alongwith proportionate undivided share in land as stock in trade, which became available to it for the purposes of dealing during the post development agreement period.
We direct the AO to compute the income of the assessee form transfer of land held by the assessee company as capital asset by way of development agreement and subsequent sale of flats and bungalows received as consideration for such transfer which took the character of stock in trade on conversion in the manner and as per the method specified above, relying on the provisions of S.45(2).
Change in the method of accounting followed by the assessee to recognize the income - Following our decision rendered in the case of M/s. Hill County Properties Ltd [2015 (5) TMI 930 - ITAT HYDERABAD] we direct the AO to adopt the date of registration of agreement or possession of units as the date of sale of units for the purpose of computing the income of the assessee as per the provisions of section 45(2) of the Act.
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2015 (5) TMI 1250
Legality of judgment of conviction and sentence under Section 3 and 7 of the Essential Commodities Act, 1955 - Seized article are Kerosene or not - possession of huge quantity of kerosene or not - violation of Kerosene Control Order or not - denial of incriminating circumstances by accused.
Revenue contended that the seized article was kerosene which was stated in the chemical examination report and no question was asked in the trial Court about the smoke test.
HELD THAT:- The expression possessed is used in certain statutory offences, in which conscious possession is necessary for proving the offence. Thus possession for the purpose of the Act means physical possession with animus custody or domain over the property. In the instant case, PW5, the Executive Officer, Ramanattukara Panchayat produced Ext.P5 extract of the building tax register which shows appellant is in possession of the building. In Ext.P6, the Village Officer, Ramanattukara reported that appellant is in possession of the property comprised in Sy. No.500/2 of Ramanattukara Village from where the article seized. Analysing the evidence of PW1, PW5 and PW6 it is found that the City Rationing Inspector on 7.8.92 searched appellant's house and seized certain article.
It is the fundamental principle of criminal jurisprudence that an accused is presumed to be innocent unless the prosecution proves the guilt of the accused beyond reasonable doubt. Generally speaking, they can rely both oral and documentary evidences to prove that the accused had committed the offence with requisite mens rea. The domain of criminal cases can be ascertained by examining, what act or omissions are declared by the State to be crimes - penal statute must be construed strictly. An accused cannot be convicted on the basis of conjectures or suspicions.
The samples were not identified as kerosene, since no smoke test was conducted, therefore Ext.P12 chemical examiner's report is not admissible in law for a conviction. Normally statutory offence like this, the requirement of smoke test is mandatory. The noncompliance of the smoke test indicates a nullification of the procedure. It is true that there is no ready test or formula to determine a provision mandatory or not, but weighing the consequence of the non-compliance, the appellant is entitled to get the benefit of doubt.
The conviction and sentence under clause 16 of the Kerala Kerosene Control Order, 1968 r/w. Sections 3 to 7 of the E.C. Act are hereby set aside - the appellant is acquitted and set at liberty - appeal allowed.
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2015 (5) TMI 1249
Constitution of Arbitrator Panel - whether another arbitrator panel should be appointed by substituting the earlier panel constituted exclusively by technical experts? - HELD THAT:- Appointment of alternate arbitrator by Court under Section 11(6) of the Arbitration Act by making a departure from the agreed procedure is permissible in deserving cases like inordinate delay in completion of arbitration proceeding and where the Arbitral Tribunal fails to perform its functions. In such events, the Court may step in to appoint substitute arbitrator by disregarding the procedure agreed by the parties.
The Apex Court in the case of UNION OF INDIA (UOI) VERSUS U.P. STATE BRIDGE CORPORATION LTD. [2014 (9) TMI 1274 - SUPREME COURT] noted that the High Court can appoint substitute arbitrators if the appointed arbitrator fails to discharge his duties - Similarly in NORTH EASTERN RAILWAY VERSUS TRIPPLE ENGINEERING WORKS [2014 (8) TMI 1236 - SUPREME COURT], it was observed by the Supreme Court that in exercise of powers under Section 11(6) of the Arbitration Act, the Court can deviate from the procedure agreed by the parties to provide for effective resolution of dispute through arbitration. Thus in a deserving case when a fresh decision of the arbitrator is necessary when the previous decision was quashed by Court, the law permits appointment of new arbitrator by departing from the agreed arrangement.
The want of judicial approach was the primary reason for the perverse decision by the Arbitration Tribunal, which was constituted only by retired/serving railway officers. In such circumstances, it is felt that a departure from the agreed process will improve the quality of adjudication and the decision making process in the de-novo process, necessitated by the Court quashing of the previous arbitral award.
Mr. Justice H.N. Sarma, a Former Judge of this Court is nominated as the Arbitrator for resolution of the contractual dispute - case disposed off.
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2015 (5) TMI 1248
Condonation of delay in re-filing the petition under Section 34 of the Arbitration & Conciliation Act - failure to explain the undue delay in re-filing - HELD THAT:- This court had duly followed this principle while disposing of the application for condonation of delay in re-filing and has not dismissed the application for condonation of delay in re-filing on the ground that the delay was beyond the time specified in Section 34(3) of the Act. The application was dismissed on the ground that the petitioner had failed to explain the undue delay in re-filing.
According to the proposition of law in DDA case [2013 (11) TMI 1527 - DELHI HIGH COURT], on which the applicant has relied, he is required to explain satisfactorily the reason for such delay and the court has clearly observed "A liberal approach in condoning the delay in re-filing an application under Section 34 of the Act is not called for". The petitioner was required to explain the delay satisfactorily but here in this case, although the delay was of 84 days in re- filing, the petitioner had claimed and explained the delay of only 24 days. No explanation, what to say "satisfactory explanation" has come from the petitioner of balance days of 60 days. No explanation for condonation of delay of these 60 days in re-filing has been given by petitioner either in his application CM No. 18445/2013 or during arguments or in written submissions.
No ground for review of the order has been made out - Application dismissed.
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