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Showing 1 to 20 of 1624 Records
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2024 (7) TMI 1624
Undervaluation of the export goods - challenge to Expert Panel Opinion inasmuch as it does not reveal the source for the market value - applicability of provisions of Section 14 of the Customs Act, 1962, read with the Customs Valuation (Determination of Value of Export Goods) Rules, 2007, to the valuation of exported rough diamonds, which are not dutiable goods under the Customs Tariff Act, 1975 - HELD THAT:- The original order dated 14.11.2022 had referred to the comments/reports submitted by the Expert Panel Members, in order to reject the declared value of export and for re-determination of the same. Both the authorities below have not furnished any reference with regard to the competency of the Expert Panel for submission of any report. Further, the said reports were also not supplied to the appellants and the reference viz., number and date of such reports were also not disclosed in the respective orders. Furthermore, we also find that there is no coherence between the Export Opinion obtained by the department inasmuch as the Single Expert Member had confirmed that the value stated by the appellant is approximately 40 to 45% less than the market rates; whereas, the Three Expert Panel Members had confirmed that the declared value on the average are 20% less than the market value as on 17.02.2021.
The said fact is evident from the respective reports inasmuch as the phrases “approximately” and “average” have been used for issuance of the certificates. In other words, the Expert Panel chosen by the department were not sure about the manner of determination of the actual value, for which there must have been laid down norms, by the established body for the diamond trade, which can be universally acceptable. Therefore, the Expert Panel reports relied upon by the department cannot be hold good for rejection of the declared value of export.
The department had not brought on record any evidence to show that the appellants had received towards the export proceeds any amount over and above the price indicated in their commercial invoice. On the contrary, we find that the appellant had raised the invoice No.29/2020-21 dated 15.02.2021 on the overseas buyer towards sale of the impugned goods, total amounting to Yuan 2,636,904/-, which was duly received through the approved banking channel by them. On perusal of Bank Realization Advices issued by Kotak Mahindra Bank, in remitting the exact invoice amount to the appellant. Thus, it cannot be said that the appellant had undervalued the goods exported by them.
Conclusion - i) Valuation provisions under the Customs Act apply only for levy and collection of customs duty and not otherwise. ii) xport of goods not subject to customs duty cannot be subjected to valuation reassessment, confiscation, or penalties under provisions linked to undervaluation for duty purposes. iii) Expert valuation reports must be transparent, based on established norms, and shared with the affected parties to be legally valid.
There are no merits in the impugned order, insofar as it has upheld the adjudication order and rejected the appeal filed by the appellants. Therefore, the impugned order is set aside and the appeals are allowed in favour of the appellants.
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2024 (7) TMI 1623
TP adjustments under the head of intra-group services - HELD THAT:- Issue would no longer survive in light of our order dated 13 August 2019 and which had recorded the Transfer Pricing Officer having undertaken the requisite Arm’s Length Price exercise.
Circuit accrual - year of assessment - The lower authorities allow the entire claim of expenditure in the next year when such reversals are made. Thus, we are of the view that this practice of disallowing the claim of circuit accrual in the year of creation and allowing it in the next year is nothing but a timing difference. The fact that the expenses are allowed in the subsequent year also proves that the lower authorities have not disputed the incurrence of such expenses. Hence, in accordance with the mercantile provisions it should be allowed in the year of creation itself. The assessee has also drawn reference to the principles laid down in the case of M/s Rotork Controls India (P) Ltd [2009 (5) TMI 16 - SUPREME COURT] and M/s Bharat Earth Movers [2000 (8) TMI 4 - SUPREME COURT]. According to us the provision for circuit accruals is made in compliance of accounting standards issued by the Institute of Chartered Accountants of India and also on a proper scientific basis backed by documentation. Therefore, we hold that the circuit accruals are created on scientific basis and thus needs to be allowed in the year of creation on accrual basis. No substantial question of law.
We consequently admit these appeals on the following question:
“1. Whether on the facts and circumstance of the case, the Tribunal was correct in law in deleting the disallowance of interest incurred on ECBs and short-term loans respectively, availed during the year, holding the same to be for 'expansion' and not 'extension' of existing business in terms of proviso to section 36(1)(iii) of the Act?”
Let the matters be called again on 18.10.2024.
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2024 (7) TMI 1622
Seeking to direct the first respondent to issue ‘No Objection Certificate’ for the release of the petitioner’s Container - failure to notify the Bill of Lading to clear the imported Cargo - HELD THAT:- This writ petition is disposed off at the time of admission after hearing the Learned Counsel for the petitioner and the Learned Senior Standing Counsel for the respondents and after dispensing with the counter by directing the first respondent to consider the petitioner’s representation dated 12-4-2024 for removal of container without the Cargo from the custody of the second respondent.
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2024 (7) TMI 1621
Levy of surcharge @ 30% on maximum marginal rate of tax @ 30% -HELD THAT:- As the income of the assessee did not exceed the monetary limit of Rs. 50 lakhs and therefore levy of surcharge is not warranted as per First schedule introduced vide Finance Act, 2021, hence the surcharge levied by the CPC and affirmed by the Ld. Commissioner is deleted. Decided in favour of assessee.
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2024 (7) TMI 1620
Treatment to the surrendered income on account of sundry debtors and excess cash found - income undisclosed or unexplained investment or money u/s 69 & 69A OR business income - whether the income offered by the assessee falls within the meaning of section 69 & 69A or not, and as to whether the same is to be charged to tax at normal rate or the rate as prescribed u/s. 115BBE? - HELD THAT:- It is not a case of investment of the abovesaid amount by the assessee, and rather, as per list prepared by the assessee, a case of receipt of the amounts from the sundry debtors, which was offered for tax as regular income of the assessee firm. Said claim of the assessee was not disputed or challenged, and furthermore, there is no further evidence adverse to said claim raised by the assessee. Therefore, it cannot be said to be a case where provisions of section 69 come into application. See M/S MONTU SHALLU KNITWEARS [2023 (12) TMI 972 - ITAT CHANDIGARH] wherein held nature and source of such unaccounted stock is nothing but arising out of assessee’s business operations. No doubt, these transactions were not recorded at the time of survey thus qualify as unrecorded transactions satisfying one of the essential conditions, at the same time, the assessee has provided the necessary explanation about the nature and source of such unrecorded transactions and the necessary nexus with assessee’s business has been established, thus, it cannot be said that these are unexplained transactions thus, doesn’t satisfy the second condition for invoking the deeming provisions of section 69B.
The amounts surrendered by the assessee at the time of survey could not be subjected to tax under the deeming provisions of section 69 & 69A of the Act. When the source and nature of income had already been considered and accepted, the subject amounts were required to be subjected to tax at normal rate. Appeal filed by the assessee is allowed
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2024 (7) TMI 1619
Maintainability of SLP - low tax effect - dispute between the parties has been referred for determination to the Lok Adalat - HELD THAT:- The tax effect of the subject matter of the special leave petition is falling below the threshold contained in the circular dated 22 August 2019 of the Central Board of Indirect Taxes and Customs.
The special leave petition is disposed of as not pressed.
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2024 (7) TMI 1618
Penalty imposed u/s 270A - intentional misrepresentation of expenditure in the profit and loss account by the assessee - CIT(A) deleted penalty levy - as argued by the DR is that there was intentional misrepresentation of expenditure in profit and loss account resulting in under-reporting of income and attempted tax evasion.
HELD THAT:- Since the assessee has pleaded that fresh loan has been obtained for capital expenditure on assets which has been claimed as capital expenditure in the ITR and now assessee submits request to reduce its claim of capital expenditure for the assets on which loan has been taken in next years. According to the Ld. AO, the plea of the assessee is found acceptable.
Not only this the Ld. AO went on to observe further that in this way, the assessee had saved itself from the double deduction on same capital assets on which loan is availed in coming years whose repayment may have been claimed by the assessee in subsequent AYs. It was in the above backdrop of the factual matrix that the Ld. AO disallowed the excess claim of capital expenditure.
There is no intentional misrepresentation of expenditure as alleged. By no stretch of imagination it can be said to be a case of attempted tax evasion as even after revision of computation, the taxable income remained Nil which is same as returned income of the assessee. In the assessment order there is no whisper that there is underreporting on total income as a consequence to misreporting as envisaged u/s 270A(8) and (9) of the Act.
We are inclined to agree with the submissions of the Ld. AR that a revision in computation of income was made with a view to correct bonafide mistake which did not have any tax implication so as to cause misrepresentation resulting in misreporting. Misrepresentation is often willful or intentional done with the intention of gaining wrongfully. Nothing of the sort has been done by the assessee. It only corrected an inadvertent mistake. Appeal of the Revenue is dismissed.
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2024 (7) TMI 1617
Seeking grant of interim bail - applicant has sought the indulgence of this Court to permit him to attend the last rites of his uncle - HELD THAT:- Considering the peculiar facts and circumstances of the case, according to which, applicant’s uncle has expired on 07.07.2024 and his last rites will be performed in near future, this Court is of the view that the prayer for interim bail can be allowed.
It is not in dispute that the passport of the applicant is with the Central Bureau of Investigation in case No. RC0962019A0002 dated 07.05.2019, under Sections 409, 419, 465, 466, 467 read with Section 120B of Indian Penal Code and Sections 13(1)(c), 13(1)(d) read with Section 13(2) of the Prevention of Corruption Act.
Considering this fact, this Court is of the view that the interim bail application is liable to be allowed, as such, his application is allowed, so that the applicant could attend the last rites of his uncle - Bail application allowed.
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2024 (7) TMI 1616
Deduction u/s.80P(2)(d) - Return of Income is not filed in time - HELD THAT:- As concurring with the view taken by the Tribunal in the case Vishva Villa Co-op Housing Society [2024 (6) TMI 1395 - ITAT MUMBAI] we hold that for the Assessment Year 2018-19, the deduction claimed by the Assessee under Section 80P(2)(d) of the Act could not have been disallowed on the ground that the return was filed after due date specified in Section 139(1) of the Act.
We note that as per Section 80P(2)(d) of the Act, for the purpose of claiming deduction under the aforesaid provision interest must be received from a ‘co-operative society’. A co-operative society is defined in Section 2(19) of the Act as being a co-operative society registered either under the Co-operative Societies Act, 1912 or under any other law for the time being in force in any State for the registration of co-operative societies.
We also find merit in the contention of the Appellant that return was, in fact, filed within time specified u/s 139(1). We observe that for the Assessment Year 2018-19, in case of person (other than a company) whose accounts were required to the audited under this Act or under any other law for the time being in force, as per Explanation 2(a)(ii) of Section 139(1) of the Act, the due date for filling of income tax return was 30th September of the relevant assessment year [subsequently substituted with 31st October vide finance Act 2020 with effect from 01/04/2020]. The Appellant being a Co-Operative Society governed by Maharashtra Co-Operative Society Act 1960 was required to be audited under Maharashtra State Co-Operative Act and therefore, was required to file its return of income upto 30/09/2018. As per Revenue the Appellant had filed return on 26/09/2018. Thus, the return was filed before the due date as prescribed under Section 139 of the Act, and therefore, the Appellant is entitled for deduction under Section 80P(2)(d) of the Act as claimed.
Order passed by the CIT(A) cannot be sustained. AO is directed to allow deduction u/s 80P(2)(d) of the Act - Decided in favour of assessee.
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2024 (7) TMI 1615
Money Laundering - HELD THAT:- The case is covered by the decision of this Court in the case of Tarsem Lal vs. Directorate of Enforcement Jalandhar Zonal Office [2024 (5) TMI 837 - SUPREME COURT]. Hence, the interim order dated 24th June, 2024 is made absolute on the same terms and conditions. The Special Court may direct the appellant to furnish bonds for appearance in accordance with Section 88 of the Code of Criminal Procedure, 1973 (Section 91 of the Bhartiya Nagarik Suraksha Sanhita).
Appeal allowed.
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2024 (7) TMI 1614
Seeking anticipatory bail under Section 438 of the Criminal Procedure Code (Cr.P.C.) in the context of proceedings under the Prevention of Money Laundering Act - it was held by High Court that the petitioner's request for anticipatory bail was not maintainable.
HELD THAT:- In view of a decision of this Court in the case of Tarsem Lal v. Directorate of Enforcement Jalandhar Zonal Official [2024 (5) TMI 837 - SUPREME COURT], the interim order dated 6th May, 2024 is made absolute on the same terms and conditions.
Appeal allowed.
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2024 (7) TMI 1613
Seeking direction to convert the non-bailable arrest warrant dated 14.02.2020 issued against the petitioner into bailable warrant in Criminal Sessions Case - petitioner is willing and ready to appear before the trial court for recording of her statements - HELD THAT:- In the premise, the instant petition is allowed and the impugned Non-Bailable Warrant dated 14.02.2020 issued against the petitioner for appearing before the trial court is converted in bailable warrant. The petitioner is directed to appear before the trial court within a period of one month of passing of the instant order alongwith the web-print of the same and upon her appearance before the trial court, she shall be released on bail by the learned trial court subject to her furnishing bail bond to the satisfaction of the learned trial court.
Petition disposed off.
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2024 (7) TMI 1612
Exemption claimed u/s. 10(38) with respect to long term capital gains - AO received information from the Investigation Wing of Income Tax Department that the assessee manipulated accounts to generate entries of bogus long term capital gains - AO has also made an addition of 3% commission payment for getting accommodation entries etc. from various intermediaries As he is a beneficiary to claim exemption of LTCG u/s. 10(38)
HELD THAT:- As it is already held that the transaction as not genuine and only make-believe agreement, the payment of commission is corollary, the addition towards commission is also upheld. Hence, the additions made with respect to LTCG and commission payment are hereby confirmed and the appeal of Revenue is allowed.
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2024 (7) TMI 1611
Application for rectification of returns filed for Financial Year 2017-2018 in Form GSTR-1 - rejection of application on the ground that the time to rectify had ended - HELD THAT:- The petitioner is allowed to rectify GSTR-1 for Financial Year 2017-2018.
Petition disposed.
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2024 (7) TMI 1610
Money Laundering - seeking enlargement on bail - mastermind of the alleged offence named Bharat Bomb has never been arrested in view of the statement made on behalf of the Directorate of Enforcement - HELD THAT:- It is required to set aside the impugned order by granting bail to the appellant subject to the conditions that may be imposed by the designated Court.
Appeal allowed.
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2024 (7) TMI 1609
Money Laundering - withdrawal of monitoring petitions challenging the cognizance order issued by the trial court under PMLA - HELD THAT:- The petitioners are allowed to withdraw the monitoring petitions.
These surveillance petitions are dismissed on the ground of withdrawal of qualified counsel by the petitioners and it is ordered that the petitioners should present themselves before the subordinate court within one month from today. During this period of one month, the proceedings for execution of arrest warrant issued against the petitioners will remain suspended. If the petitioners do not present themselves before the trial court within a period of one month, it will be presumed that the petitioners are avoiding appearance by ignoring the order of the court and the trial court will be free to summon the petitioners / accused again with arrest warrant.
The stay applications filed along with these review petitions are also disposed of.
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2024 (7) TMI 1608
Addition u/s 68 - treating share capital and share premium received as unexplained income of the assessee u/s 68 - HELD THAT:- We find that the assessee has successfully discharged the burden of proof primarily casted upon it to explain the identity and creditworthiness of all the 9 share applicants and genuineness of the share transactions and correctness of such details has not been disputed by the Revenue Authorities except making general observations. No justification on the part of the lower authorities in making the impugned addition and the same is accordingly ordered to be deleted. Appeal of the assessee stands allowed.
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2024 (7) TMI 1607
Estimation of the income @ 8% of contract receipts available in Form 26 AS - HELD THAT:- Admittedly, the assessee does not maintain any books of accounts and has filed return of income @ 1.5% gross turnover.
AO has taken 8% of the contract receipts estimated @ 8% of gross receipts citing the case of Ganga Prasad Sharma [1980 (3) TMI 49 - MADHYA PRADESH HIGH COURT] that there is a certain degree of guess work in best judgment assessment and he has taken income @ 8% of contractual receipt taking into contract works.
AR has submitted that the assessee is not in civil contract business and section 44AD is not applicable as turnover of the assessee is more than 4 Crores.
AR has also submitted that in similar line of business, the profit margin is 3.5%. We have gone through the assessment order, CIT (A) order, and comparable cases. Considering the turnover and the nature of business, in our opinion 5% of turnover will be reasonable estimate for estimating the income of assessee. Appeals filed by the assessee are partly allowed.
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2024 (7) TMI 1606
Exemption u/s 11 - scope and amplitude of the definition “charitable purpose” - HELD THAT:- Matter is remitted to the authority concerned to decide the same afresh in view of the ratio decided in AHMEDABAD URBAN DEVELOPMENT AUTHORITY [2022 (10) TMI 948 - SUPREME COURT]
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2024 (7) TMI 1605
Penalty u/s 271D and u/s 271E - violations of Sections 269SS and 269T - as argued incriminating evidences as relied do not establish any transaction of loan or payment of interest - HELD THAT:- We are of the considered view that with regard to the incriminating nature of the evidences which were allegedly unearthed in the search and subsequently requisitioned by the AO, the issue about their veracity is still wide open in the light of the pendency of the appeals in the case of Sant Asharam ji Ashram and even in the case of the assessee, wherein additions on merits have been challenged.
Thus, without going into the merits of the same, if the penalty order is examined, it comes up that the AO has merely relied the observations in the assessment order for concluding that there were transactions of loan taken from Asharam in cash violating section 271D and that the alleged loan were repaid to Asharam in cash leading to alleged violation and penalty u/s 271E.
Now as settled proposition of law, we find that penalty proceedings are included in the expression "assessment" and the true nature of a penalty is the imposition of an additional tax. But, one of the principal objects is to provide a deterrent against recurrence of default on the part of the assessee. Therefore, the relevant sections 269SS read with section 271D and 271E of the Act is a penal provision and the proceedings imposing penalty are quasi- criminal in nature.
The onus is heavy on the Department to not only establish the facts with categorical finding, independently of the assessment order but to also successfully canvass that due process of law was strictly followed.
The penalty orders as passed in the case in hand show that the AO has drawn conclusion on the basis of ‘elaborate discussion’ in the assessment order without making a specific examination of the issues, independently. It is for this reason the discrepancies with regard to the name of the borrower or lender being Shri Asharam ji Ashram or Shri Asharam Bapu or stating violator to be assessee company while the assessee is individual have crept in.
In this background, if we consider the purport of the CBDT Circular dated 26.04.2016 which is heavily relied by the ld. counsel of the assessee that reference for the purpose of penalty u/s 271D and 271E of Act should be made during the course of assessment proceedings itself. We find that directions were not complied.
Since, in the Act, there is no specific provision about the stage at which the reference for penalty is to be made during assessment, therefore, the initiation of the reference is akin to filing of complaint before JCIT and same has to be as per due procedure, laid down under the law. Since there is no specific provision in the Act, this circular shall prevail. Revenue cannot claim it to be merely advisory. As observed earlier, at cost of repetition we hold that this direction of Board has subsumed in the Act, as a step validating the exercise of jurisdiction to initiate penalty proceedings by JCIT concerned.
Here in the case in hand initiation was not during the pendency of the assessment, as directed by the Circular, but way after, thus the assumption of jurisdiction to issue the penalty notice was vitiated and, consequently, the imposition of penalty also stands vitiated. Decided in favour of assessee.
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