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Newsletter: Where Service Meets Reader Approval. TMI Tax Updates - e-Newsletter October 19, 2020 Case Laws in this Newsletter: GST Income Tax Corporate Laws Securities / SEBI Insolvency & Bankruptcy Service Tax Central Excise Articles PROHIBITION ORDER UNDER GST News Sale of Electoral Bonds at Authorised Branches of State Bank of India (SBI) Finance Minister Smt. Nirmala Sitharaman participates in 102nd meeting of the World Bank Development Committee Plenary Notifications Companies Law G.S.R. 642(E). - dated 16-10-2020 - Co. Law Companies (Prospectus and Allotment of Securities) Amendment Rules, 2020 Customs 31/2020 - dated 16-10-2020 - ADD Seeks to amend notification No. 49/2015-Customs (ADD), dated 21st October, 2015 to extend the levy of ADD on imports of “Front Axle Beam and Steering Knuckles meant for heavy and medium commercial vehicles” originating in or exported from China PR, for a period upto and inclusive of the 30th November, 2020. 101/2020 - dated 16-10-2020 - Cus (NT) Notification in relation to the road connecting Jaigaon Bazar in India and Phuentsholing in Bhutan and Asian Highway 48 connecting Torsha tea garden in India and Ahllay in Bhutan by amendment of Principal Notification No. 63/1994-Customs dated 21st November, 1994 GST 05/2020 - dated 16-10-2020 - CGST Rate Amendment in Notification No. 12/2017- Central Tax (Rate), dated the 28th June, 2017 05/2020 - dated 16-10-2020 - IGST Rate Amendment in Notification No. 9/2017- Integrated Tax (Rate), dated the 28th June, 2017 05/2020 - dated 16-10-2020 - UTGST Rate Amendment in Notification No. 12/2017- Union Territory Tax (Rate), dated the 28th June, 2017 GST - States 05/2020- State Tax (Rate) - dated 16-10-2020 - Bihar SGST Seeks to amend Notification No. 12/2017-State Tax (Rate), dated the 29th June, 2017 3(52)/Fin(Rev.-I)/2020-21/DS-IV/122 - dated 16-10-2020 - Delhi SGST Lt. Governor of National Capital Territory of Delhi, appoint the officers 56/2019-State Tax - dated 15-10-2020 - Delhi SGST Delhi Goods and Services Tax (Seventh Amendment) Rules, 2019. 71/2020 State Tax - dated 14-10-2020 - Maharashtra SGST Seeks to amend notification 14/2020- State Tax to extend the date of implementation of the Dynamic QR Code for B2C invoices till 01.12.2020. 70/2020 State Tax - dated 14-10-2020 - Maharashtra SGST Seeks to amend notification no. 13/2020-State Tax dt. 30.03.2020. 68/2020 State Tax - dated 13-10-2020 - Maharashtra SGST Seeks to grant waiver / reduction in late fee for not furnishing FORM GSTR-10, subject to the condition that the returns are filled between 22.09.2020 to 31.12.2020. 67/2020 State Tax - dated 13-10-2020 - Maharashtra SGST Seeks to grant waiver / reduction in late fee for not furnishing FORM GSTR-4 for 2017-18 and 2018-19, subject to the condition that the returns are filled between 22.09.2020 to 31.10.2020. 68/2020-State Tax - dated 21-9-2020 - Meghalaya SGST Seeks to grant waiver/reduction in late fee for not furnishing FORM GSTR-10, subject to the condition that the returns are filled between 22.09.2020 to 31.12.2020. 67/2020-State Tax - dated 21-9-2020 - Meghalaya SGST Seeks to grant waiver / reduction in late fee for not furnishing FORM GSTR-4 for 2017-18 and 2018-19, subject to the condition that the returns are filled between 22.09.2020 to 31.10.2020. FIN/REV-3/GST/1/08 (Pt-1)(Vol.II)/162 - dated 22-9-2020 - Nagaland SGST Amendment in Notification No. F.NO. FIN/REV-3/GST/1/08 (Pt-1) /20 dated the 29th December 2017 FIN/REV-3/GST/1/08 (Pt-1)(Vol.II)/161 - dated 21-9-2020 - Nagaland SGST Seeks to amend Notification No. F.NO. FIN/REV-3/GST/1/08 (Pt-1)(Vol.II)/103 dated the 3rd April 2020 SEZ S.O. 3625(E) - dated 17-9-2020 - SEZ Inclusion of new members in CSEZ Authority – Amendment in Notification S.O. 2262(E) dated 28th May, 2018 Highlights / Catch Notes GST Classification of goods - HSN Code - rate of tax - pre-mix popcorn maize packed with edible oil and salt - This product is essentially corn kernels to which oils salt and various spices, and flavours are added. But the essential nature of the product is still the corn kernels which are the seeds of the maize plant. - the product is question is covered under CTH 20081990 and not under CTH 2106 - AAR Visit to Get Source Refund of Input Tax Credit - rejection on account of Inverted Tax Structure - Export at concessional rate of GST - The burden to prove on which date and how the related documents were supplied is on the appellant. There should be a dated acknowledgement duly stamped by the department to prove that the relevant documents have been submitted to the department so that benefit could be provided to the appellant. - Commissioner Visit to Get Source Income Tax Disallowance of interest expenses against the income from other sources - Once the part of the borrowed fund is utilized for the purpose of business being introduction of capital in the proprietorship concern and partnership firm from where the assessee has earned the business income and offered to tax then the proportionate interest expenditure is an allowable business expenditure. - AT Visit to Get Source Exemption u/s 11 - charitable activity u/s 2(15) - extra fees collected over and above prescribed fees - capitation fee - benefit of section 11 of the Act cannot be denied to the assessee only on the allegation of charging of extra fees from prescribed limit by taking respectful cognizance of the interim orders of Hon’ble High Court of Orissa. - AT Visit to Get Source Revision u/s 263 - AO himself initiated proceedings u/s.154 to rectify error apparent on record on the aspect of computation of LTCG goes to show that he had while completing the Assessment not made proper enquiries. The law is well settled that if there is a failure on the part of AO to make an enquiry on the issue which calls for an enquiry, that by itself will render the order of assessment erroneous and prejudicial to the interests of the revenue. - AT Visit to Get Source Income accrued in India - Amount received by the assessee from its distributors for sale of specialized software and maintenance and support services (including upgrades) cannot be held as being in the nature of “royalty” as per Article 12 of the India-Finland tax treaty. - AT Visit to Get Source Unexplained investment OR STCG - Investment in land from undisclosed sources made in purchase of land from various persons/farmers - Suspected short term capital gain from sale of property - search u/s 132 - transfer of the land to the company under POA u/s 2(47) - The tax authorities are entitled to look into the surrounding circumstances are discussed hereinafter. Moreover, the question is that what was the need to prepare these documents by the company when no transactions have been made with the assessee - CIT(A) wrongly deleted the additions - AT Visit to Get Source Corporate Law Compounding of offences relating to contravention - The quantum of penalty specified by the ROC in his report furnished maximum penalty prescribed under the relevant section. There is no minimum penalty prescribed under the section and it only says upto one lakhs and upto ₹ 5000 per day. Therefore, the Tribunal has to take into consideration of the extenuating circumstances as available in given case - Minimum Compounding fine imposed taking a lenient view - Tri Visit to Get Source Winding up order - The incorporation and conducting of business of the Company itself was with unlawful and fraudulent objects, and its affairs are being conducted in total violations of extant provisions of Law - it would be just and proper to order winding up the Respondent Company, without prejudice to the actions being initiated by other Statutory Authorities - company is ordered to be wound up - Tri Visit to Get Source Winding up of Company - failure to make payment of outstanding dues due to financial difficulty - the Petitioner has not taken any steps to comply office objections raised by the Registry and also not served the copy of the Petition on other side. The Petitioner failed to submit the required information as required under Section 9 of the Code till date. Therefore, the instant Company Petition abates and thus it is liable to be rejected, by reserving liberty to the Petition to file appropriate Application/Petition in accordance with the provisions of the IBC 2016, and rules made there under. - Tri Visit to Get Source IBC Initiation of CIRP - "The right to sue", therefore, accrues when a default occurs. If the default has occurred over three years prior to the date of filing of the Application, the Application would be barred under Article 137 of the Limitation Act, save and except in those cases where, in the facts of the case, Section 5 of the Limitation Act may be applied to condone the delay in filing such Application". - AT Visit to Get Source SEBI Board (SEBI) obligation to grant a personal hearing to the petitioner - The Petitioner has submitted the relevant material. Petitioner has also been given an opportunity to submit additional written submissions. Once there is no requirement of a personal hearing under Regulation 29, we do not find that there is a special case made out by the Petitioner or any extraordinary circumstances exist to give special direction for the Petitioner. - HC Visit to Get Source Central Excise Valuation - inclusion of transportation charges received by the appellant in the assessable value - it is now well settled that the buyer’s premises can never be the place of removal, therefore the freight from the factory/depot/consignment agent up to the buyer’s premises cannot be included in the assessable value, even if the goods are sold or delivered at the buyer’s premises - AT Visit to Get Source Case Laws: GST 2020 (10) TMI 724 Classification of goods - HSN Code - rate of tax - pre-mix popcorn maize packed with edible oil and salt - whether classified under HSN Heading 2008 chargeable to tax at the rate of 12%? - tax rate of 12% have retrospective effect from 1st July 2017 or not? - HELD THAT:- Chapter 20 covers Preparations of vegetables, fruit, nuts or other parts of plants. As per Explanatory Notes to Chapter 20 covers vegetables, fruit, nuts and other edible parts of plant prepared r preserved not provided for in Chapter 7, 8 and 11. It is seen that these processes in Chapter 7, 8, and 11 include freezing, steaming, boiling, dried, provisionally preserved and milling. Therefore, any edible part of plant such as seeds, which is preserved in any other process than these is classifiable under Chapter 20. Explanatory Notes to chapter 2008 states that fruits, nuts and other edible parts of plants prepared or preserved in processes other than the above ones. Other substances (e.g. starch) may be added but the essential character of the edible part of the plant should remain unaltered. In the instant case, the product are corn kernels or seeds (edible parts of the maize plant) which are cleaned, destonned to which oil, salt and various spice and flavour mixes are added before being packed together. It is seen from the packaging that they are specifically packed for popcorn vending machines. Not for retail sale . The Ingredients mentioned on the packaging are: Corn, RBD Plamolien oil, Iodised Salt and some of them have added flavours such as Butter Flavour, Turmeric Powder, Natural Carotenoids, natural food colours etc. The corn kernels are only cleaned and flavors added. They do not undergo any of the processes of Chapter 7, 8 or 11. This product is essentially corn kernels to which oils salt and various spices, and flavours are added. But the essential nature of the product is still the corn kernels which are the seeds of the maize plant. If heated, these corn kernels will become popcorn with the added flavours - corn kernels /seeds with added oils and spices are classifiable under CTH 20081990. Those food preparations not specified elsewhere in the Tariff and preparation for use either directly or after processing for human consumption are categorized in this head. It is also stated in the HSN notes that those preparations made from edible parts of plants of heading 2008 are excluded from this heading. Therefore, the product is question is covered under CTH 20081990 and not under CTH 2106 - On the applicable rate of tax, the product in hand is classified under CTH 20081990 and is liable to CGST @6% as per Si No 40 of Schedule II of N/N. 01/2017-C.T. (Rate) dated 28.06.2017 and SGST @6% as per Sl.No. 40 of Schedule II of Notification No. II (2)/CTR/532(d-4)/2017 vide G.O. (Ms) No. 62 dates 29.06.2017. This rate effective from 1st July 2017 and there has been no change since then. 2020 (10) TMI 723 Denial of Generation of E-way bill - petitioners were informed that unless they clear their GSTR-3B return for 02 or more tax periods upto August, 2020, their EWB generation facility will be blocked on the EWB portal - HELD THAT:- Mr. S. C. Keyal, learned Standing counsel, GST Department submits that he be permitted time till 19th of October to obtain the required instructions in the matter - Accordingly upon hearing the learned counsel for the parties, list the matter again on 19th October, 2020 for further orders. List accordingly. 2020 (10) TMI 722 Maintainability of appeal - appeal has been rejected on the ground of the same being barred by limitation - Section 107 (1) of the CGST Act, 2017 - HELD THAT:- The appellate authority in rejecting the application for condonation of delay and as a consequence rejecting the appeal vide his impugned order dated 30.06.2020 on the ground of delay, does not seem to be proper, legal and justified. The appellate authority ought to have given a fair consideration to the contentions of the petitioner and ought to have got it verified whether the order was duly served either physically or electronically to the petitioner and only then should have taken a decision. In the absence of any such exercise and deciding the application for condonation of delay only on the basis of the pleadings, the impugned order, in the opinion of this Court, is not sustainable and the same deserves to be and is accordingly set aside. The matter stands remitted back to the appellate authority i.e. respondent no.1 to consider and decide the application of the petitioner for condonation of delay on its own merits after due verification of the facts - Petition allowed by way of remand. 2020 (10) TMI 721 Refund of Input Tax Credit - rejection on account of Inverted Tax Structure - Export at concessional rate of GST - non-compliance with the conditions mentioned at serial no.(v) (ix) of the N/N. 40/2017 dated 23, 10.2017 and 41/2017 dated 23.10.2017 - period November-2017 - Section 54 of the CGST Act, 2017 - HELD THAT:- Condition No.(v) and (ix) of both the Notification No.40/2017 dated 23.10.2017 and 41/2017 dated 23.10.2017 have not been complied with by the appellant in the instant case. The contention of the appellant that they have submitted copy of purchase orders, shipping bill or bill of jading to the Range Office in respect of supply made by the appellant and therefore condition enumerated in the notification has been very well complied with, is not acceptable. The burden to prove on which date and how the related documents were supplied is on the appellant. There should be a dated acknowledgement duly stamped by the department to prove that the relevant documents have been submitted to the department so that benefit could be provided to the appellant. But the appellant could not produce any substantial document which could prove/substantiate their claim that he has complied With the conditions of both the Notifications i.e. 40/2017 dated 23.10.2017 and 41/2017 dated 23.10.2017. Appeal rejected - decided against appellant. Income Tax 2020 (10) TMI 720 Exemption u/s 11 - AO came to the conclusion that assessee was engaged in the Area Development and Town Planning and carrying out the activity of general public utility not carrying out any charitable activities and was squarely covered by proviso 1 2 to Section 2(15) r/w Section 13(8) - HELD THAT:- Functions of the respondent assessee are for charitable purposes and for general public utility and therefore, the respondent assessee is entitled to exemption under Section 11 of the Act. Following the judgment of this Court in the case of Ahmedabad Urban Development Authority [ 2017 (5) TMI 1468 - GUJARAT HIGH COURT] present appeal fails and is hereby dismissed. Substantial questions of law as framed are answered in favour of the assessee. 2020 (10) TMI 719 Levy of penalty u/s 271AA - Assessee did not file Form 3CEB before 30.09.2011 for A.Y. 2011-12, being the specified date for its filing but the same was filed only on 18.07.2013 after the fact of non-compliance was confronted to assessee - No information about the international transaction in its transfer pricing report - CIT-A deleted the addition - HELD THAT:- CIT(A) while deleting the penalty has given a finding that assessee has kept and maintained the information about the international transactions, the discussion of which is also in the Transfer Pricing Report which was submitted to the TPO during the assessment proceedings. CIT(A) thus concluded that the assessee was maintaining the information and documents as prescribed under the law regarding international transactions and that assessee has not failed in reporting any international transactions. Before us, Revenue has not pointed to any fallacy in the findings of CIT(A). We further find that the ratio of the decision in the case of Mak Data Pvt. Ltd [ 2013 (11) TMI 14 - SUPREME COURT] relied before us by Revenue is not applicable to the facts of the present case. - Decided in favour of assessee. 2020 (10) TMI 718 TDS u/s 194J - Disallowance u/s 40(a)(ia) - failure to withhold tax on payments made to Nokia Corporation towards purchase of end user operating software, purchase of hardware and finished goods and purchase of software embedded in finished goods - HELD THAT:- As decided in own case [ 2020 (2) TMI 1038 - ITAT DELHI ] AO has not given any reasoning or finding to the extent that there is payment for technical service liable for withholding under Section 194J. Marketing activities have been undertaken by HCL on its own. Merely making an addition under Section 194J without the actual basis for the same on part of the Assessing Officer is not just and proper. DR s contention that discounts were given by way of debit notes and the same were not adjusted or mentioned in the invoice generated upon original sales made by the assessee, does not seem tenable after going through the invoice and the debit notes. In fact, there is clear mentioned about the discount for sales promotion. Thus, on both the account the addition made by the Assessing Officer does not sustain. - Decided in favour of assessee. Disallowance on account of trade price protection paid by the assessee - HELD THAT:- Following the order of the Co-ordinate Bench for A.Y. 2010-11 in assessee s own case [ 2020 (2) TMI 1038 - ITAT DELHI ] and for similar reasons hold that the disallowance on account of trade price protection was not warranted in the present case. We therefore, set aside the action of AO. Thus ground of appeal of the assessee is allowed. Disallowance of warranty expenses - HELD THAT:- As relying on case A.Y. 2010-11 in assessee s own case [ 2020 (2) TMI 1038 - ITAT DELHI ] disallowance was not warranted in the present case. We therefore, set aside the addition made by AO. Thus ground of appeal of the assessee is allowed. 2020 (10) TMI 717 Penalty levied u/s 271(1)(c) - Defective notice - non striking inappropriate words - no mention under which limb of provisions of Section 271(1)(c) of the Act, the Assessing Officer has levied penalty? - HELD THAT:- Notices u/s 274 r.w.s. 271 was issued on 29.12.2017 for the assessment year 2010- 2011 and 2011-12 and the inappropriate words in the said notice have not been struck off. Therefore, it is not understood as to under which limb of provisions of Section 271(1)(c) AO has levied penalty. Since the said show cause notices issued u/s 274 did not specify the charge against the assessee as to whether it was for concealing the particulars of income or for furnishing inaccurate particulars of income, therefore, the penalty orders passed under Section 271(1)(c) of the Act in pursuance to the said notices were rightly reversed by ld CIT(A) - SEE M/S SSA S EMERALD MEADOWS [ 2015 (11) TMI 1620 - KARNATAKA HIGH COURT] AND M/S MANJUNATHA COTTON AND GINNING FACTORY OTHS., M/S. V.S. LAD SONS, [ 2013 (7) TMI 620 - KARNATAKA HIGH COURT] - Decided in favour of assessee. 2020 (10) TMI 716 Reopening of assessment - non disposal of the objections before passing the reassessment order - HELD THAT:- There are divergent views of different High Courts on the issue whether non disposal of the objections before passing the reassessment order would render the reassessment order invalid or it is only a procedural irregularity. Since the decision of the Hon ble Jurisdictional High Court is binding on the Tribunal, therefore, this Tribunal in the said case of Shri Manoj Dubey SH. GOVIND SHARAN GUPTA [ 2020 (5) TMI 574 - ITAT JAIPUR] has followed the decision of Hon ble Jurisdictional High Court being a binding precedent. Accordingly following the earlier order as well as the decision of Hon ble Jurisdictional High court, decide this issue in favour of the assessee Disallowance of interest expenses against the income from other sources - HELD THAT:- Order of the AO itself reveals the fact that the borrowed fund was not fully utilized for giving the loans on which the assessee has earned the interest income under section 56 of the IT Act and claimed the interest deduction under section 57(3) of the Act. Once the part of the borrowed fund is utilized for the purpose of business being introduction of capital in the proprietorship concern and partnership firm from where the assessee has earned the business income and offered to tax then the proportionate interest expenditure is an allowable business expenditure. Thus it is only an error of claiming the deduction under correct head but the entire interest was claimed against the income from other sources. As relying on disallowance made by the AO in respect of interest expenditure is deleted. 2020 (10) TMI 715 Deduction u/s 80P(2)(a)(i) - interest received by the assessee from Jaipur Central Cooperative Bank is not covered u/s 80P(2)(d) as the assessee has not produced any document to prove that Jaipur Central Cooperative Bank is a Cooperative Society - validity of Certificate issued by the Registrar of Cooperative Societies - HELD THAT:- Assessee has produced the Certificate issued by the Registrar of Cooperative Societies whereby Jaipur Central Cooperative Bank was registered as a Cooperative Society. As regards the objection of the ld. D/R regarding production of this Certificate at this stage as an additional evidence, it is to be noted that the Certificate produced by the assessee is not the assessee s own document but it is a document otherwise available in public domain and issued by the Registrar of Cooperative Societies. Therefore, this fact cannot be disputed or the Certificate issued by the Registrar of Cooperative Societies cannot be doubted. Substance in the objection made by the ld. D/R against the production of the Certificate issued by the Registrar of Cooperative Societies. Once Jaipur Central Cooperative Bank is found to be a Cooperative Society, the interest received from the said Cooperative Bank/Society is eligible for deduction under section 80P(2)(d). As relying on SHREE KESHORAI PATAN SAHAKARI SUGAR MILL AND VICE-VERSA [ 2018 (2) TMI 499 - ITAT JAIPUR] held Jaipur Central Cooperative Bank is a Cooperative Society registered under Cooperative Societies Act, the interest received by the assessee from the said Cooperative Bank is eligible for deduction under section 80P(2)(d) of the Act. The disallowance/addition made by the AO and confirmed by the ld. CIT (A) is deleted. 2020 (10) TMI 714 Validity of reopening of assessment - absence of the issuance of the notice u/s 143(2) - HELD THAT:- As relying on SUKHINI P. MODI [ 2014 (11) TMI 50 - GUJARAT HIGH COURT] to quash the entire proceeding under Section 147 of the Act in the absence of issuance of statutory notice under Section 143(2) of the Act upon the appellant. Also see M/S. HOTEL BLUE MOON [ 2010 (2) TMI 1 - SUPREME COURT] - The assessee s appeal is, thus, allowed. 2020 (10) TMI 713 Exemption u/s 11 - charitable activity u/s 2(15) - extra fees collected over and above prescribed fees - AO further noted that the notwithstanding the fact that the surplus of funds arising out of receipts from students are utilized for expansion of infrastructure by the Trust, for carrying of educational activities cannot be considered solely for charitable purposes being education but for commercial activities where education is sold for a price - HELD THAT:- Undisputedly, assessee trust enjoys registration u/s.12AA of the Act and it is also not a case of the AO that the activities of the assessee are not in accordance with its objects stated in the trust deed or assessee is doing or conducting any activities beyond its objects which is in the nature of commercial activities for profit motive. In view of interim orders passed by Hon ble High Court of Orissa, no hesitation to hold that the Hon ble High Court has allowed the assessee to retain extra amount of fees from prescribed limit till disposal of writ petitions. Even if assessee does not succeed in the said writes, then also, excess or extra charged fees has to be adjusted towards the fees of the respective students from whom it has been collected during completion of their courses. We refrain from making any observations regarding allegation of the AO about charging of extra fees from prescribed limit as the issue is pending for adjudication before the Hon ble High Court of Orissa in the respective writ petitions filed by the assessee. Therefore, benefit of section 11 of the Act cannot be denied to the assessee only on the allegation of charging of extra fees from prescribed limit by taking respectful cognizance of the interim orders of Hon ble High Court of Orissa. Denial of benefit of section 11 is not correct and sustainable. Consequential disallowance of salary paid to Mrs Sujata cannot be held as justified and sustainable. - Decided in favour of assessee. 2020 (10) TMI 712 Revision u/s 263 - CIT set aside the orders of AO allowing deduction to the assesses u/s. 54F of the Act and also on the issue of quantum of capital gain for de novo assessments by the AO - HELD THAT:- From a perusal of the orders of assessment in the case of both the Assessee s, it appears to us that before concluding the assessment proceedings the AO did not make any enquiries with regard to the deduction u/s.54F. In the note attachment to the order of assessment, there is a reference to the claim of the Assessee having been examined u/s.54 and the factum of having verified all sale deeds and purchase deeds. Since the office note is not clear about what enquiries the AO made before concluding the assessment, we have to conclude that the findings of the Pr.CIT that the AO has not made adequate and proper enquiries before concluding the Assessment, is correct. Assessee could not substantiate before us as to how the AO made enquiries on this issue before concluding the assessment, except by pointing out that all facts were laid before the AO and it can be presumed that he had taken note of this aspect while concluding the assessment. AO himself initiated proceedings u/s.154 to rectify error apparent on record on the aspect of computation of LTCG goes to show that he had while completing the Assessment not made proper enquiries. The law is well settled that if there is a failure on the part of AO to make an enquiry on the issue which calls for an enquiry, that by itself will render the order of assessment erroneous and prejudicial to the interests of the revenue. Since there was a failure on the part of AO to make necessary enquiry, we are of the view that the Pr.CIT was justified in invoking jurisdiction u/s. 263 of the Act in the facts and circumstances of the present case. Claim of the Assessee for deduction while computing LTCG has to be examined de novo without being influenced by any of the discussion in the impugned order of the Pr. CIT as the jurisdiction u/s.263 of the Act has been exercised by the Pr.CIT on the ground of the failure on the part of the AO to make proper enquiries before completing the assessment. The Assessee should also be allowed to substantiate his claim for deduction u/s.54 of the Act, because the liability to tax depends on the provisions of law and facts of a case and not on the basis of any admission or incorrect claim made by an Assessee. We therefore modify the order of the Pr. CIT in the terms indicated above, i.e., the AO while completing the assessment pursuant to impugned orders should complete the assessment de novo and all issues referred to above, will be open for consideration before the AO. Appeals by the assesses are partly allowed. 2020 (10) TMI 711 Deduction u/s. 80IC - service fees income - Whether deduction should be allowed on the services fees also as it has a close nexus with the supply of software and hence has to be regarded as part of the profits derived from the eligible business? - Conclusion of the CIT(Appeals) was that service activity was separate and independent and had nothing to do with the supply of software by the assessee - HELD THAT:- the contracts are with 3 different parties. It is clear from the submissions made before the CIT(A) that the service income in respect of which the Assessee claimed deduction u/s.80IC of the Act had a clear nexus with the supply of software and providing services were inter-linked and therefore the service fees received was to be regarded as profits derived by the industrial undertaking from manufacture of goods. As decided in own case [2020 (5) TMI 14 - ITAT BANGALORE] the claim made by the assessee for deduction u/s. 80IC of the Act on service income ought to have been allowed by the AO/CIT(A) and they fell into an error in not allowing the said claim. We therefore hold that the assessee is entitled to claim deduction u/s. 80IC of the Act on service income - Decided in favour of assessee. 2020 (10) TMI 710 Addition of share premium amount u/s 56(2)(viib) - Valuation of shares - assessee furnished a valuation report issued by a Chartered Accountant in support of the share premium amount collected by it Chartered Accountant had valued the shares under discounted cash flow method (DCF method) - HELD THAT:- AO has proceeded to determine the value of shares in both the years by adopting different method without scrutinizing the valuation report furnished by the assessee under DCF method. Accordingly, following the decisions rendered by the co-ordinate benches, we set aside the orders passed by Ld CIT(A) in both the years and restore the impugned issue in both the years to the file of the AO with the direction to examine this afresh as per the directions given by the co- ordinate bench in the case of Innoviti Payment Solutions P Ltd [ 2019 (1) TMI 688 - ITAT BANGALORE]. 2020 (10) TMI 709 Rectification of mistake u/s 254 - subsequent binding of the Hon ble jurisdictional High Court, which has reversed the earlier decision - eligibility of Deduction u/s 80P - Tribunal have originally dismissed the Revenue s appeal by following the decision The Chirakkal Service Cooperative Bank Ltd [ 2016 (4) TMI 826 - KERALA HIGH COURT] but in Mavilayi Service Co-operative Bank Ltd. [ 2019 (3) TMI 1580 - KERALA HIGH COURT] has held that its earlier decision in the case of The Chirakkal Service Co-operative Bank Ltd. and Others (supra) is not good law and AO has to conduct an inquiry into the factual situation as to the activities of the assessee-society and arrive at a conclusion whether the benefits can be extended or not in the light of the provisions of sub-section (4) of section 80P - period of limitation - HELD THAT:- Tribunal is a creature of the statute. It has not having the power to read in or read out of a provision of law. The Legislature in its wisdom has laid down the law and the specific provision relating to the powers of the rectification of mistakes in the order of the Tribunal is in section 254(2) of the Income-tax Act, 1961. Admittedly, the order of the Tribunal is dated 24th October, 2016. The miscellaneous application has been filed on 30.09.2019. The six month period in the present case expired on 30th April, 2017. It shows that the time limit of six month is binding on the hands of the Tribunal. This is in line with the decision of the Hon ble Bombay High Court in the case of Principal CIT v. ITAT [ 2020 (2) TMI 129 - BOMBAY HIGH COURT] As six month period from the end of the month in which the order has been passed has expired, the order passed by the Tribunal cannot be amended by the Tribunal. Consequently, the miscellaneous application filed by the Revenue stands dismissed. 2020 (10) TMI 708 Income accrued in India - Royalties and Fees for Technical Services - payment received by the Appellant towards sale of off-the shelf software - assessee is a tax resident of Finland - India-Finland DTAA - HELD THAT:- As decided in own case [ 2020 (7) TMI 99 - ITAT MUMBAI] the payments received by the assessee towards distribution of sub-releases and main releases were also for a right to provide a copyrighted article i.e software updates, which was akin to the amounts received for distribution of the specialized off-the-shelf software products, and not for any right to use the copyright embedded in the said copyrighted article (i.e software products), therefore, the same too in our considered view cannot be construed as royalty income, and would be the business income of the assessee. On a similar footing, we find, that as per the distributors agreements, it was the responsibility of the distributors to resolve the end user customers queries. In case, the distributors would require assistance on issues as regards functionalities, trouble shooting and verifying error situations, the assessee would provide the same. The aforesaid queries would be resolved via e-mails or telephone calls by the employees of the assessee based in Finland. In our considered view, as the payments received by the assessee from rendering of the maintenance and support services does not fall within the scope and gamut of the definition of royalty in Article 12 of the India-Finland tax treaty, therefore, the payments received by the assessee for providing such support services cannot be held as royalty in the hands of the assessee. Amount received by the assessee from its distributors for sale of specialized software and maintenance and support services (including upgrades) cannot be held as being in the nature of royalty as per Article 12 of the India-Finland tax treaty. - Decided in favour of assessee. 2020 (10) TMI 707 Estimation of income - Bogus purchases - disallowance @ 12.5% reduced by CIT-A - HELD THAT:- No doubt the purchases made from the suspected parties are not genuine. Purchases itself cannot be doubted as rightly adjudicated by Ld. CIT(A) that AO has not doubted sales declared by the assessee, only he suspected the purchases. Considering the facts of this case, by respectfully following the decision of Hon ble Gujarat High Court in the case of CIT vrs. Smith P. Sheth [2013 (10) TMI 1028 - GUJARAT HIGH COURT] we are inclined to agree with the findings of Ld. CIT(A). Therefore, grounds raised by the revenue are dismissed. 2020 (10) TMI 706 Unexplained investment OR STCG - Investment in land from undisclosed sources made in purchase of land from various persons/farmers - Suspected short term capital gain from sale of property - search u/s 132 - transfer of the land to the company under POA u/s 2(47) - HELD THAT:- It cannot be said that the unsigned MOU has no weight in the eyes of law when the purchaser and seller has taken congnizance of this MOU in their further transaction. Further, the other documents i.e. 'Account of Sh.Surjit Singh and Schedule of payment', are the documents of unaccounted transactions made between assessee and the company, which prepared only for remembering purpose and due to that reason, these documents had not been signed by any other party. The contention of the assessee that these unsigned documents have no weigh in the eyes of law is not acceptable in view of this factual position. CIT(A) wrongly held that the AO has not brought any evidence on record to show that the assessee had purchased the land from various persons/ farmers on agreements/ikrarnamas or power of attorney in his name and later transferred the same to M/s Horizon Buildcon Pvt Ltd., on power of attorney of the original owners , ignoring the detailed discussion of the same in the assessment order. On going through the assessment order and the submissions of the assessee and the Revenue, we are of the opinion that the AO has rightly held that documents in question were not signed by any of the party, but the authenticity of these documents cannot be denied in view of the fact that the things have been happened further according to the said MOU and according to other documents found at the business premises of M/s Horizon Builcon (P) Ltd. The tax authorities are entitled to look into the surrounding circumstances are discussed hereinafter. Moreover, the question is that what was the need to prepare these documents by the company when no transactions have been made with the assessee. Hence, these documents also established that the assessee has taken land from various farmers/persons on agreement to sell/biyana or POA and then transferred the same land to the company as POA. We found strong substance on the submissions of ld. DR that there was a transfer in the name of the assessee as per Section 2(47) and Section 47 of the Act. In this particular case, the assessee received payment from M/s Horizon Buildcon Pvt. Ltd. which are evident from the records seized by the revenue authorities during the course of search and seizure and the statements of accounts were also found, which is also discernible from the assessment order as well as the documents considered by the AO during the course of assessment. However, the CIT(A) has ignored the legal position which were applicable in the present case in hand. Accordingly as per above discussions the Capital Gain calculated by the Assessing Officer is also correct. Accordingly, we dismiss the impugned order passed by the CIT(A) and allow the appeal of Revenue Corporate Laws 2020 (10) TMI 705 Permission to withdraw, from time to time, such amounts as may be required for the educational expenses of his son - HELD THAT:- The son of the Applicant has received intimation letter from the Institute of Management and is desirous of taking admission there. It cannot be disputed that the expenses of admission and the course which the son of the Applicant wishes to undertake cannot be met from the limited/fixed amount that the applicant is allowed to withdraw every month from his bank account(s). The Applicant would not be in a position to meet the educational expenses of his son from the amount that the Applicant is allowed to withdraw, nor has he any other resources for the purpose. The objection by the Respondent (UOI), that the Applicant is involved in the financial irregularity of the Gitanjali Gems Ltd and that is being invested by SFIO as well as the CBI would not be relevant for the prayers made in the present Application. The prayers made in the Application concerns the life and the career of young man who has nothing to do with the alleged wrongdoings of his father. The involvement or otherwise of the Applicant in the Company Petition would be taken into account during hearing of the Petition after considering all the relevant facts. The Applicant is permitted to withdraw such amount as would be necessary from the HDFC Account to defray the educational expenses of his son Manthan Sanjay Rambhia for pursuing the PGDM eBiz program in Welingkar Institute of Management Development Research, Matunga, Mumbai on his submitting the Institute s intimation or letter requiring him to deposit such amounts with the Institute according to the payment schedule of the Institute - Application allowed. 2020 (10) TMI 704 Restoration of name of the Company in the Register of Companies, maintained by the Registrar of Companies, Kochi - Section 252(1) of the Companies Act, 2013 - HELD THAT:- This Tribunal is of the opinion that it would be just and equitable to order restoration of the name of the Company in the Register of Companies and consider shareholder to be the member of the company to file this appeal. The Registrar of Companies, the respondent herein, is ordered to restore the original status of the Appellant Company as if the name of the company has not been struck off from the Register of Companies and take all consequential actions like change of company s status from Strike off to Active (for e-filing) - Name restored - application allowed. 2020 (10) TMI 703 Contravention of Section 96 R/w Section 99 Section 441 of Companies Act, 2013 - compounding of offences relating to contravention - HELD THAT:- The ROC has not opposed the instant Petition but stated material facts regarding violations and maximum prescribed and number of days in complying with violations. The Petitioners have satisfactorily explained the reasons for delay in complying with violations in questions and filed the instant Petition suo motto, that too after making good violations in question. The Petitioners have not committed similar violations earlier and these are the first violations committed by them. The Report of ROC mentioned maximum penalties prescribed under the extant sections. Therefore, depending on the facts and circumstances of the case, the Tribunal is empowered either to impose suitably penalty or even wait it. Under sub section 1 of Section 441 of Companies, Act, 2013, the Tribunal is empowered to compound violations/offences committed by Companies, either before or after prosecution, on specifying quantum of payment, however, such sum should not in any case exceed the maximum amount of fine which may be imposed for the offence so compounded. The quantum of penalty specified by the ROC in his report furnished maximum penalty prescribed under the relevant section. There is no minimum penalty prescribed under the section and it only says upto one lakhs and upto ₹ 5000 per day. Therefore, the Tribunal has to take into consideration of the extenuating circumstances as available in given case. As stated supra, the Learned Counsel, has satisfactorily explained to Tribunal, the reasons for committing violations/offences in question, so as consider to impose minimum penalty. He is also justified to take a plea of present adverse economic situation arise due to pandemic. Therefore, we are inclined to take a lenient view of matter and thus want to impose minimum Compounding fine. Application allowed in part. 2020 (10) TMI 702 Approval of the Scheme of Amalgamation - Sections 230 to 232 of the Companies Act, 2013 - HELD THAT:- This Company Petition is allowed, and the Scheme of Amalgamation annexed with the Petitions is hereby sanctioned. The Scheme approved shall be binding on the Shareholders, Creditors and employees of the Companies involved in this Scheme. The Appointed date of the Scheme is 1st April, 2019. Scheme approved. 2020 (10) TMI 701 Sanction of a Scheme of Amalgamation - section 230 to 232 of the Companies Act, 2013 - HELD THAT:- On perusal of the documents produced on record, it appears that provisions of Section 230-232 of the Companies Act, 2013 are satisfied. This Tribunal finds that in the Scheme of amalgamation the Petitioner Transferor Company's entire business including assets, liabilities, rights, obligation get transferred and get merged with the Petitioner Transferee Company and the Petitioner Transferor Company shall get dissolved without winding up and hence the revenue's interest is duly protected and the apprehension of the Official Liquidator about the revenue's interest shall get adversely affected, is without merits as the liabilities, obligations if any of the Petitioner Transferor Company does not get diluted even remotely and become the liabilities and obligations of the Petitioner Transferee Company and further this Tribunal directs that Petitioner Companies shall co-operate with the authorities in the pending proceedings and shall undertake to discharge the liabilities, obligations if any arises and accrues in future upon crystallization of the liabilities and / or obligations. Thus, this Tribunal sanctions the Scheme and allows the prayer and the Scheme is hereby sanctioned and shall be binding on respective shareholders and creditors. Petition allowed. 2020 (10) TMI 700 Approval of Scheme of Amalgamation - Sections 230 and 232 of the Companies Act, 2013 read with the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 - HELD THAT:- The procedure specified in sub-sections (1) and (2) of section 232 of the Companies Act, 2013 has been complied with, and hence the Scheme of Amalgamation, as approved by the Petitioner Company, is hereby sanctioned, as prayed. The Scheme of Amalgamation (enclosed as Annexure-A to this Company Petition) is hereby sanctioned and the Appointed Date shall be 01st April, 2013. The effective date of the Scheme shall be the date of this order - Application allowed. 2020 (10) TMI 699 Approval of Scheme of Amalgamation (Merger by Absorption) - Section 230-232 of Companies Act - HELD THAT:- Directions regarding holding and dispensation of various meetings issued - directions regarding issunce of various notices also issued - application allowed - scheme is approved. 2020 (10) TMI 698 Restoration of name of the Company namely M/s. SRK Sugars Private Limited in the Register of Companies maintained by the Registrar of Companies - section 252 of the Companies Act, 2013 - HELD THAT:- It is not in dispute that the Registrar of Companies is conferred with power U/s. 248(1) to strike off the Company, if the Company has failed to commence its business within one year of its incorporation or a Company is not carrying on any business or operation for a period of two immediately preceding financial years and has not made any Application within such period for obtaining the status of a dormant Company U/s. 455. However, Section 248(6) states that the Registrar of Companies, before finally striking off Company, has to satisfy himself that sufficient provision has been made for the realization of all amounts due to the Company and for the payment or discharge of its liabilities and obligations by the Company within a reasonable time, and, if necessary, obtain necessary undertakings from the Managing Director, Director or other persons in charge of the management of the Company. Though the impugned striking off the Company was in accordance with law, the Tribunal has to take into consideration of bonafide contentions of Petitioner seeking to restore name of Company, by taking a lenient view of the issue in the interest of justice and ease of doing business, instead of rigidly interpreting the law on the issue. The Registrar of Companies, Karnataka, the Respondent herein, is ordered to restore the name of the Company in the Register maintained by the Registrar of Companies, Karnataka as if its name had not been struck off from the rolls of the Register with restoration of all consequential action by Registrar of Companies, which includes restoration of DINs of its Directors - name restored - application allowed. 2020 (10) TMI 697 Approval of Composite Scheme of Amalgamation and Arrangement - Sections 230 to 232 of the Companies Act, 2013 and other applicable provisions of the Companies Act, 2013 R/w the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 - HELD THAT:- It has been stated by the Regional Director that, on a consideration of the materials on record, the Scheme appears to be fair, reasonable and is not detrimental against the Members or Creditors or contrary to public policy and the same can be approved - In his report the Regional Director, MCA has concluded that the Scheme appears to be fair, reasonable and not detrimental against the Members or Creditors or contrary to public policy and the same can be approved. The procedure specified in sub-sections (1) and (2) of section 232 of the Companies Act, 2013 has been complied with. It appears that the amalgamation will enable the Transferee Company to consolidate its business operations, promote growth of the Transferee Company, result in economy of scales and reduction in overheads, help in optimal utilization of various resources, and the increased asset base of the Transferee Company would benefit the Transferor Companies and the Transferee Company, and be in the interest of all the creditors including the creditors of the Transferor Companies. Hence the Composite Scheme of Amalgamation and Arrangement, as approved by the Boards of the Petitioner Companies, can be sanctioned, as prayed. The scheme is approved. 2020 (10) TMI 696 Sanction of Amalgamation Scheme - Sections 230 to 232 of the Companies Act, 2013 - HELD THAT:- From the material on record, the Scheme appears to be fair and reasonable and is not in violation of any provisions of Law and is not contrary to public policy - Since all the requisite statutory compliances have been fulfilled, Joint Company Petition filed by Petitioner Companies are made absolute in terms of prayer clause (a) thereof. The Scheme is hereby sanctioned, and the Appointed Date of the Scheme is fixed as 1st August 2018. The Transferor Company is ordered to be dissolved without winding up - Application allowed. 2020 (10) TMI 695 Sanction of scheme of amalgamation - sections 230-232 of the Companies Act 2013 - HELD THAT:- From the material on record, the Scheme appears to be fair and reasonable and is not violative of any provisions of law and is not contrary to public policy - The Appointed Date of the Scheme is fixed as 1st April 2018 - The Transferor Company shall be dissolved without winding-up. The Petitioner Companies are directed to lodge a certified copy of this Order and the Scheme with the concerned Superintendent of Stamps, within 60 working days from the date of receipt of certified copy of order, for adjudication of stamp duty payable, if any - The Petitioner Companies are directed to lodge a certified copy of this Order along with a copy of the Scheme with the concerned Registrar of Companies, electronically in Form INC-28 within 30 days from the date of issue of the order by the Registry, duly certified by the Deputy/Assistant Registrar of this Tribunal. Application allowed. 2020 (10) TMI 694 Winding up order - Prevention of any withdrawals, transfer, disposal/diversion of funds or closure of the said accounts; to direct to disclose moveable and immovable properties/assets, including bank accounts, owned by the Company in India or anywhere in the world - restraint on Respondents from accepting further deposits/money from existing members or fresh deposits/money from the Public etc. - Whether the Central Government is empowered and justified to order investigation into the ownership of any Company, under provisions Companies Act, 2013 in public interest? - Whether the Petitioner proved that affairs of the Company are being conducted in a fraudulent manner or the Company was formed for fraudulent and unlawful purpose or the persons concerned in the formation or management of its affairs have been guilty of fraud, misfeasance or misconduct in connection therewith and that it is proper that the company be wound up? - Whether the Company is given reasonable opportunity by the Petitioner to disprove the case of Petitioner for wind up of the Company? HELD THAT:- THE findings in Investigation Report in question, has clearly indicted the Directors of Company leading to filing the instant Petition, apart from initiating prosecution before Special court, matter was referred to various statutory Authorities like Central Board of Indirect Taxes and Customs, Chief Secretary, Govt. of Karnataka; State Level Co-ordination Committee for taking appropriate action. The Company has not filed any Application seeking further modification of Interim orders dated 07.03.19 and 09.07.2019, after withdrawal of Company Appeal by the Respondent, before the Appellate Authority, however, except seeking to permit it to pay statutory dues. Therefore, the interim orders dated 07.03.19 and 09.07.19 passed by the Tribunal made final as it requires no modification since the Respondent could not plead any extenuating circumstances to vacate the interim order as the main Company Petitions are also being disposed of finally and Official Liquidator would take care of affairs of Company. Therefore, it would be just and proper to restrain the Company and its Directors from operating any affairs of Company including operating its Bank Accounts. The Central Govt. and the Registrar of Companies and the Inspectors appointed, have followed all extant provisions of Companies Act and rules made thereunder including principles of natural justice in ordering investigation, conducting investigation in question. However, the Directors of the Company, though appropriate notice given under the provisions of Companies Act, they have failed to avail it - The Company is established exclusively for the benefit of three Promotee-cum- Directors-cum- shareholders, and their Agents, and hardly any service provided to its customers except few customers, out of paltry sum of money remains, after apportioning the Deposits by way of collecting Membership fee, among themselves by way of huge Dividend/salaries/commission/awards to themselves and their Agents. The contention of the Respondent that investigation Report in question is inconclusive, and it gives no cause of action for the Petitioner to file the instant Petitions is not at all tenable - Therefore, various contentions/allegations raised by the Respondents are not all tenable, and thus they are liable to be rejected. The incorporation and conducting of business of the Company itself was with unlawful and fraudulent objects, and its affairs are being conducted in total violations of extant provisions of Law - it would be just and proper to order winding up the Respondent Company, without prejudice to the actions being initiated by other Statutory Authorities - company is ordered to be wound up - application allowed. 2020 (10) TMI 693 Rectification of the Register of Members of the Respondent Company - restraint on Respondent Company from holding the Annual General Meeting or Extraordinary General meeting - Section 59(1) of the Companies Act, 2013 - Whether the Company by exercising paramount lien can sell off the shares of a shareholder for recovering the dues? - HELD THAT:- The Respondent Company in the instant petition will fall under the category of unpaid seller who can exercise the above rights only. Nothing more. It is settled law as decided by the Hon'ble Supreme Court of India in its judgement in TRIVENI SHANKAR SAXENA VERSUS STATE OF U.P. AND OTHERS [ 1991 (12) TMI 285 - SUPREME COURT] a lien is only a right to retain which is rightfully and continuously in possession belonging to another until the claims are satisfied. It can be acquired either by contract or by operation of law. It is the right of retention of goods - in the absence of delineated process to exercise paramount lien, the Respondent Company can exercise lien to the extent of retention of goods; in this case shares which can be extendable payable to the shareholder - the submissions made by the Respondent Company cannot be agreed upon. Whether the action of 1st Respondent Company is backed up by any contractual agreement to recover the 'rental dues' by auctioning the shares? - HELD THAT:- In the absence of a written agreement a documentary evidence to support their action, the very action of the Respondent's company was without any basis. Any of the unilateral action by one party, will not bind the others and will be set aside. Further the contention that the shops are under benami holding and not conforming to the Income Tax Act is not supported by any valid notice from income Tax authorities or any credible report to support this argument. Even if we go by submissions of learned PCS for respondents, we have not come across any steps taken by the respondent company to regularise the position in respect of the shops which are the property of respondent Company. During the arguments the bench asked to the PCS representing the company whether the company has taken any steps to get the shop vacated by the occupants for their rental arrears. The respondents submitted that they have not taken any action in this regard. Whether due process is followed by the Company in auctioning and allotting the shares to a 3rd party? - HELD THAT:- The Articles of Association of the company is silent about the process to be followed to ensure paramount lien. However, in the Respondent Company, the lien was exercised for recovery of rental dues by auction the shares. Here the Respondents exercised right to lien to recover the arrears of rent from the shareholder who has not agreed to execute rental/lease agreement - In the instant petition, the Respondent auctioned the shares without the consent of shareholders and without original shre certificate and transfer form in their possession. The earlier action appears to the illegal and not as per the Companies Act 2013 - answered in negative. The company has no right to auction and allot the shares to the third parties ignoring the right of fully paid up shareholders. The rental dues claimed by the respondent company is not supported by rental/lease agreement which is agreed by shareholder - Petitioner is declared as the legitimate equity share holder under Folio No. 41 - application disposed off. 2020 (10) TMI 692 Winding up of Company - failure to make payment of outstanding dues due to financial difficulty - section 433 (e) (f) R/w 434 439(1) (b) of the Companies Act, 1956 - HELD THAT:- The main Company Petition was filed before the Hon'ble High Court of Karnataka, as early as 18.12.2015, wherein it was not properly prosecuted resulting into the dismissal of the Company Petition, even for non-compliance of office objections. The Petitioner also could not serve notice of the Petition on the Respondent till date, even after transferring the matter to Tribunal, the Petitioner has not taken any steps to comply with the rule 5(1) of the TPP rules, 2016 till date. The last date for complying with the promise of the court was 15.07.2017. Admittedly the Petitioner has not taken any steps to comply extend provisions of the CPP rules till date. Therefore the Petitioner is liable to dismiss for non-compliance of extend rules after transfer from the Hon'ble High Court of Karnataka. The case was transferred to this Tribunal by Hon'ble High Court of Karnataka vide proceedings dated 18.11.2019. Accordingly, the case was scrutinized by the Registry of this Tribunal and found that only one set of paper was available, and thus another set was s required to be filed on the record, and the Petitioner has to compliance provisions as contemplated in the case. However the Petitioner failed to comply and was not present when the case was listed for admission on 27.12.2019. However, the Petitioner has not taken any steps to comply office objections raised by the Registry and also not served the copy of the Petition on other side. The Petitioner failed to submit the required information as required under Section 9 of the Code till date. Therefore, the instant Company Petition abates and thus it is liable to be rejected, by reserving liberty to the Petition to file appropriate Application/Petition in accordance with the provisions of the IBC 2016, and rules made there under. Petition is disposed of as abated by reserving liberty to the Petitioner to file appropriate Application/Petition in accordance with the extant provisions of the IBC 2016, and rules made there under. 2020 (10) TMI 691 Restoration of name of the Company on the Register of Companies maintained by the Registrar of Companies - non-filing of Annual Returns and Balance Sheets before the ROC - Section 252(3) of the Companies Act, 2013 - HELD THAT:- In the year 2011 Government of India planned to conduct the single All India Entrance Test for medical students from 2012 which encouraged the promoters of the company to start the company in this regard. In-between, in the matter of MEDICAL COUNCIL OF INDIA VERSUS CHRISTIAN MEDICAL COLLEGE VELLORE ORS. [ 2016 (4) TMI 1396 - SUPREME COURT] the Association of Private Medical Colleges went to Hon'ble Supreme Court against the Central Government's Order and the verdict was given in favour of the Association of Private Medical Colleges because of which the Company had no option but to stop the business. However on 11.04.2016 the Hon'ble Supreme Court reversed their own judgment i.e. Medical Council of India Vs. Christian Medical College Vellore Ors. and allowed the Central Government to conduct the single Entrance Test for Medical students. Now, there seems to be bundle of opportunities for the Company due to revision in the decision by the Hon'ble Supreme Court. It is also stated that the petitioner Company is getting enquiries and also negotiating with its prospective clients regarding the possible projects, wherein the petitioner company is confident of getting projects and also considerable revenue from the same. It is further stated that the petitioner company has also finalised its financial statements Annual returns for the financial year end 2012 to 2018. The Applicant Company intends restart its business, and it would be proper to restore its name in the Register of Companies. Further, the Company has undertaken to file all the overdue Balance Sheets and Annual Returns for the periods of default, within 30 days of restoration - Company petition is allowed by directing the Registrar of Companies to restore the name of the Company in the Register of the Registrar of Companies, as if it was not struck off, subject however, to its making statutory compliances within a period of 30 days and payment of a cost of ₹ 25,000/-. Application allowed. Securities / SEBI 2020 (10) TMI 689 Whether the Board obliged to grant a personal hearing to the petitioner while considering an exemption application under the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 - HELD THAT:- It is a settled position that the requirement of compliance with the principle of natural justice can vary in different situations and conditions. Even where situations where principles of natural justice require an opportunity of hearing, it does not in all circumstances mean a personal hearing. A reasonable opportunity of being heard to the applicant before deciding exemption application. Therefore whenever it is found necessary to provide for an opportunity, SEBI has expressly incorporated it in such provisions. No such stipulation is found in the Regulation at hand. Apprehension expressed by the SEBI that by reading duty to give personal hearing in this Regulation would have adverse ramifications on its working cannot be said to be unwarranted. The SEBI has framed several regulations on various aspects of the securities market. A large number of applications are filed before it. It will hamper the functioning of the SEBI if the exercise of its every power is preceded by mandatory personal hearing, whether the regulation provides for it or not. There is no duty on the Board while considering an exemption application under Regulation 29 of the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014, to give a personal hearing to the applicant. Interest of justice to give a personal hearing to the Petitioner - argument of the Petitioner that since SEBI has formed an opinion and the rigid application of the Regulations, it is necessary to give an opportunity of personal hearing - As rightly pointed out by SEBI, there is no such formation of opinion. There were no reasons given in the earlier order. The Petitioner has submitted the relevant material. Petitioner has also been given an opportunity to submit additional written submissions. Once there is no requirement of a personal hearing under Regulation 29, we do not find that there is a special case made out by the Petitioner or any extraordinary circumstances exist to give special direction for the Petitioner. Writ Petition is dismissed. Insolvency & Bankruptcy 2020 (10) TMI 690 Maintainability of application - initiation of CIRP - Corporate Debtors failed to make repayment of its dues - existence of debt and dispute or not - HELD THAT:- There are definitely claims and counter-claims which, prima facie, leads to a conclusion that there exists a dispute prior to delivery of the notice under section 8 of IBC, 2016 - As per the decision of the Hon'ble Supreme Court in the case of Mobilox, [ 2017 (9) TMI 1270 - SUPREME COURT ] it is to be seen that whether such dispute is real and genuine on the basis of apparent facts and is not feeble to avoid the payment. From the contentions of both the sides, it is apparent that corporate debtor has made counter-claims and even some of the requirements of the purchase order have not been met. Further, no material has been brought to record by the operational creditor to dispute the claims made by corporate debtor in its letter dated 26.07.2017. These facts lead to the inevitable conclusion that there exists a dispute in real sense. Thus, conditions for admissibility of an application filed under Section 9 of IBC, 2016 are not satisfied. Application dismissed. 2020 (10) TMI 688 Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Non-performing asset - revival of dead debt - time limitation - HELD THAT:- The Application filed by the Respondents under Section 7 of the Code in the present case is an effort to revive a dead debt. The date of default is crucial to determine the date when the cause of action accrued. In this case, the Respondent has not mentioned the date of default. In the case of Gaurav Hargovindbhai Dave [ 2019 (9) TMI 1019 - SUPREME COURT ] , Hon'ble Supreme Court has considered that the date of default to be the date of NPA. Therefore, the date of default, in this case, is 31st January 2010 - The right to sue under IBC occurs when default occurs. If the default has occurred over three years period prior to the date of filing the Application, the Application would be time-barred. Admittedly, in this case the Corporate Debtor was declared to be Non-performing Asset on 28th May 2014. The date was later changed to 31st January 2010. Therefore, if the position taken by the Financial Creditor Bank is taken as correct, 'Default' occurred on or before 31st January 2010. The period of Limitation for the same would expire on 30th January 2013. The Application for initiation is filed on 23rd July 2018 - The right to sue , therefore, accrues when a default occurs. If the default has occurred over three years prior to the date of filing of the Application, the Application would be barred under Article 137 of the Limitation Act, save and except in those cases where, in the facts of the case, Section 5 of the Limitation Act may be applied to condone the delay in filing such Application . The Application filed under Section 7 of the Code by the Financial Creditor is barred by Limitation - Application dismissed. 2020 (10) TMI 687 Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - recovery of the unpaid Operational Debt due - existence of debt and dispute or not - HELD THAT:- The Demand Notice is issued on 15.03.2017. This application has been filed by the Petitioner on 28.08.2018 i.e. after 17 months. This Adjudicating Authority is not the right forum to examine and adjudicate as to which portion of the claims are admissible. The Adjudicating Authority will also not examine the merits of the dispute. There are repeated complaints of the Respondent about non-functioning of the Office 365 Licenses and counter complaints of the Petitioner regarding absence of Essential System Requirements in the organization of the Respondent. Thus, there is sufficient material to believe that disputes certainly exist in the facts of the present case regarding non-functioning of the System provided by the Petitioner - Pre-existing dispute before the filing of this application is observed. The petition does not deserve admission - Petition rejected. 2020 (10) TMI 686 Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - existence of debt and dispute or not - time limitation - refusal of delivery - deemed delivery or not - photocopies of envelope in which the demand notice was sent - valid evidence or not. Whether this application is time barred? Would limitation in insolvency matters be saved by virtue of a decree passed in a civil suit for recovery of money? - HELD THAT:- In the present case the default has occurred over four years prior to the date of filing of the present application. The provision that may save the limitation for Applicant-Operational Creditor is acknowledgement under section 18 of the Limitation Act, 1963, however, there is nothing on record to prove any acknowledgement from the Corporate Debtor. Learned Counsel appearing for the Operational Creditor submits that limitation is saved due to a decree in a civil suit for recovery of money that was pronounced on 18.09.2018. However, the decree has been pronounced way beyond the limitation period got over. Moreover, an ex-parte decree is not an acknowledgement of debt with regards to section 18 of the Limitation Act - the application is time barred and the said ex-parte decree does not amount to acknowledgment of debt under section 18 of the Limitation Act. This issue is answered accordingly. Can refusal of delivery be accepted as deemed delivery for the purpose of section 8 of the Code? - Whether photocopies of envelope in which the demand notice was sent can be admitted as a valid evidence? - HELD THAT:- As per Rule 5(2) of IBBI (Application to Adjudicating Authority) Rules, 2016 the demand notice under section 8 of the Code has to be effectively delivered on the Corporate Debtor. The IBC being a complete code in itself and its provisions having an overriding effect on other laws, by virtue of the said Rule 5(2) there can be no presumption of delivery in matters related to Insolvency Proceedings, unlike matters otherwise than under the Code where section 27 of the General Clauses Act applies. Moreover, no explanation is forthcoming as to non production of the original envelope for our perusal - the refusal of delivery cannot be accepted as deemed delivery for the purpose of section 8 of the Code. These issues are answered accordingly. Although the Corporate Debtor in its reply affidavit has agreed to the debt and default, the claim being barred by law of limitation and for want of delivery proof of Section 8 demand notice to the Corporate Debtor, this application is not fit for admission - Application dismissed. 2020 (10) TMI 685 Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - unpaid Operational Debt due - existence of debt and dispute or not - HELD THAT:- This Adjudicating Authority is satisfied that, a) Existence of debt is above Rs. One Lac; b) Debt is due; c) Default has occurred on 16.03.2018; d) Petition had been filed within the limitation period as the invoices are 2017 whereas the Application is filed on 11.10.2018 which is within 3 years of due for payment; e) The Applicant was invited as a Creditor by the Corporate Debtor to the meeting held for Amalgamation. The Applicant had objected the Amalgamation Petition filed on CP(CAA) 1 of 2019 in CA(CAA) No. 112 of 2018. It is a proof that the Corporate Debtor has acknowledged the Applicant as its Creditor. f) Copy of the Application filed before this Tribunal has been sent to the Corporate Debtor, Notice has been duly served. The Respondent has failed to appear before this Adjudicating Authority and the Petition filed by the Petitioner under Section 9 of IB Code is found to be complete for the purpose of initiation of Corporate Insolvency Resolution Process against the Corporate Debtor Company. The present IB petition is admitted. 2020 (10) TMI 684 Reimbursement of CIRP cost - HELD THAT:- It is found that ARCIL was part of the CoC. When CoC was constituted by the RP, the ARCIL was included in the CoC on his consent and always remained present in the meeting of the CoC - On further perusal of the records, it is observed that, CoC which consists of Kotak Resources and the ARCIL, ARCIL too ratified the CIRP cost of ₹ 12,12,831.00 in its meeting held on 07.08.2018. Accordingly, ARCIL cannot retract from their consent which is/was admission on their part. The said fact is reflected from resolution dated 07.08.2018 at page No. 94 of the petition, wherein, CoC resolved that the expense pertaining to resolution costs amounting in aggregate to ₹ 12,12,831.00 be and hereby ratified and approved . This Adjudicating Authority is of the considered view that CoC consisting of both the Kotak Resources and ARCIL are responsible for the reimbursement of the CIRP cost to the RP in the equal proportion - this Bench hereby, orders both the members of the CoC to reimburse the CIRP cost of ₹ 12,12,831.00 in equal proportion to the RP within 15 days from the receipt of this order. Application disposed off. 2020 (10) TMI 683 Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - existence. of debt and dispute or not - HELD THAT:- The present Respondent made efforts to raise a pre-existing dispute in order to get dismissal of the present I.B. Petition. However, he did not explain the reason as to why he made proposal for settlement by acknowledging its debt liability to the extent of ₹ 21.00 Lakhs and above but only sought for repayment schedule from September 2018 to April/March 2019. Thus, the admitted outstanding due is ₹ 21.00 Lakh and is requested to be paid till March 2019 - However, no settlement could be materialised. Hence, the debt is well established due to undisputed amount of ₹ 21.00 Lakhs and the default of payment has been occurred. Hence, the CIRP can be triggered in respect of the Corporate Debtor Company. The present I.B. Petition is filed under Section 9 of the code by an authorised signatory Mr. Anuj Saraf (Partner) found to be filed within limitation and is complete for the purpose of initiation of Corporate Insolvency Resolution Process (C.I.R.P.) in respect of the Corporate Company - Petition admitted - moratorium declared. 2020 (10) TMI 682 Approval of the Resolution Plan - Section 31 of the Code read with Regulation 39 of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 - HELD THAT:- Adjudicating Authority is not expected to substitute its view with the commercial wisdom of the CoC nor should it deal with the technical complexity and merits of Resolution Plan, unless it is found contrary to express provision of law and goes against the public interest. The object of the Code is to promote resolution and every effort must be made to try and see that resolution is made possible. Accepting the Resolution Plan is advantageous to all the stake holders and amounts to maximisation of the assets of the Corporate Debtor and promotes entrepreneurship and to ensure that the Company continue to function as a going concern. The right of rejection or approval of a plan is with the CoC. In a particular case, what should be the percentage of claim amount payable to one or other 'Financial Creditor' or 'Operational Creditor' or 'Secured Creditor' or 'Unsecured Creditor' can be decided by the Committee of Creditors based on facts and circumstances of each case. What can be screened by this Bench is that whether the plan approved by Committee of Creditors meets the requirements as referred to in sub-section (2) of Section 30 of the Code. In the present case the resolution plan has been approved with 66.13 % voting share well above the statutory requirement of 66 % in terms of Section 30(4) of the Code and has the requisite statutory voting share. Besides the decision of Committee of Creditors is a reasoned and self-speaking one as required under proviso to Regulation 39(3) of the CIRP Regulations, 2016 - It is well settled proposition of law that commercial and business decisions of Committee of Creditors are not open to judicial review. Adjudicating Authority cannot enquire into the commercial wisdom of Committee of Creditors. The ground for rejection is limited to the matter specified under Section 30(2). It is however reiterated that the resolution plan in question meets the requirements specified in Section 30(2) of the Code and the commercial majority decision of the Committee of Creditors appears to be neither discriminatory nor perverse. Insolvency and Bankruptcy Code, 2016 is a complete Code in itself and is exhaustive of the matters dealt with therein. The Code is a comprehensive legislation including both the procedural as well as substantive law. In this regard Hon'ble Supreme Court in the case of M/S. INNOVENTIVE INDUSTRIES LTD. VERSUS ICICI BANK ANR. [ 2017 (9) TMI 58 - SUPREME COURT] has observed that it is an exhaustive code on the subject matter of insolvency in relation to corporate entities and others. It is also true that IBC, 2016 is a single unified Umbrella Code, covering the entire gamut of the law relating to insolvency resolution of corporate persons and others in a time bound manner. - In the present case with the admission order, CIRP has commenced in respect of the corporate debtor and Moratorium as provided under Section 14 of the Code has been declared prohibiting the institution of suits, or continuation of pending suits or proceedings against the corporate debtor, including execution of any judgment, decree, or order in any court of law, Tribunal, arbitration panel, or any other authority. The spirit of the Code encourages resolution. Resolution is the rule and the object of the Code is to promote resolution. Every effort must be made to try and see that resolution is made possible. Commercial collective decision of Committee of Creditors with requisite majority has to be respected. The commercial or business decisions of the financial creditors are not open to any judicial review by the adjudicating authority or the appellate authority - The legislature has not endowed the adjudicating authority (NCLT) with the jurisdiction or authority to analyse or evaluate the commercial decision of the Committee of Creditors. Adjudicating Authority has no jurisdiction to question the actions of the Committee of Creditors. Tribunal cannot sit in appeal over the expert business decision of the 'Committee of Creditors'. After a resolution plan is approved by the requisite majority of the Committee of Creditors, the aforesaid plan must then pass muster of the Adjudicating Authority under Section 31(1) of the Code. The Adjudicating Authority's jurisdiction is circumscribed by Section 30(2) of the Code. The requirements as per the Code and regulations have been complied with. Moreover, the Resolution Plan has been approved by 66.13 % voting share of the members of Committee of Creditors and has been submitted in compliance of Section 30 of the Code for approval - Resolution plan is approved. 2020 (10) TMI 681 Maintainability of application - initiation of CIRP - inability of Corporate Debtor to liquidate its operational debt - existence of debt and dispute or not - time limitation - HELD THAT:- Admittedly no reply was sent to the Demand Notice and hence no dispute was raised under Section 8 sub Section 2 of the Code and the amount claimed by the Operational Creditor has not been paid by the Corporate Debtor and we have also noticed that the application is complete. Further, the amount claimed by the Operational Creditor is more than ₹ 1 lakh which is the minimum threshold limit fixed under IBC, 2016 and the present petition being filed on 02.08.2019 is within limitation, being within three years from the date of the cause of action. Therefore, under such circumstances, there are no option but to reject the contention of the Corporate Debtor that the application is not maintainable and it is liable to be rejected, the Operational Creditor has succeeded to establish this fact that he raised the last invoice on 20.09.2016, the Corporate Debtor has defaulted in paying the dues and the present application is within limitation as it was filed on 02.08.2019. This Adjudicating Authority is inclined to admit this petition and initiate CIRP of the Respondent - Petition admitted - moratorium declared. 2020 (10) TMI 680 Maintainability of application - initiation of CIRP - Corporate Applicant had guaranteed the repayment of amounts borrowed by M/s. J R Foods Limited to Bank of Baroda - existence of debt and dispute or not - HELD THAT:- From the financial statements submitted by the Corporate Applicant, as to the query raised by this Authority, the Corporate Applicant was unable to explain as to why there is a depletion in the amount of General Reserve as evidenced from the heading Reserves and Surplus, which appears in the Balance Sheet as on 31.03.2018 at ₹ 1,02,95,314/- vis-a-vis and the amount is shown at ₹ 29,96,364/- as per the last balance sheet which is purportedly on 31.03.2019, in page No. 50 of the typed set filed with the Application - Further, a perusal of the typed set of documents filed by the Corporate Applicant goes on to show that there are various discrepancies in the records, more particularly with respect to the Audited Balance Sheet as on 31.03.2018 and further Rule 7 of the Insolvency Bankruptcy (Application to Adjudicating Authority) Rules, 2016, empowers this Adjudicating Authority to look into the documents which are being filed by the Corporate Applicant and to ascertain whether the said documents are in order. It must be noted here that this Adjudicating Authority is not a mere stamping authority and is required to apply its mind in relation to the veracity of the documents filed correlating with Annexures required to be enclosed under the prescribed form, namely Form 6 under the Insolvency Bankruptcy (Application to Adjudicating Authority) Rules, 2016. However, it is evident from the record or proceedings that the matters were initially reserved for orders on 08.11.2019 and thereafter, it was posted for clarifications on 18.11.2019 and to rectify the defects in the Application as per proviso the sub - section (4) of Section 10 of IBC, 2016. In spite of the same, the discrepancies in the documents still persist and the Corporate Applicant was unable to explain as to why there is a depletion in the amount of General Reserve as on 31.03.2018 as compared to 15.09.2019. The reason for drain in reserve could not be explained by the Applicant to the satisfaction of this Tribunal. This Authority does not deem fit and appropriate for considering this Application under Section 10 of I B Code, 2016 - Application dismissed. 2020 (10) TMI 679 Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - existence of debt and dispute or not - HELD THAT:- This adjudicating authority is of the considered view that operational debt is due to the Applicant and it fulfilled the requirement of I B Code. That, service is complete and no dispute has been raised by the respondent at any point of time. That, Applicant is an Operational Creditor within the meaning of Section 5 sub-section 20 of the Code, From the aforesaid material on record, petitioner is able to establish that there exists debt as well as occurrence of default and the amount claimed by operational creditor is payable in law by the corporate debtor as the same is not barred by any law of limitation and/or any other law for the time being in force. Section 13 of the Code enjoins upon the Adjudicating Authority to exercise its discretion to pass an order to declare a moratorium for the purposes referred to in Section 14, to cause a public announcement of the initiation of corporate insolvency resolution and call for submission of claims as provided under Section 15 of the Code. Sub-section (2) of Section 13 says that public announcement shall be made immediately after the appointment of Interim Insolvency Resolution Professional. This Adjudicating Authority direct the Interim Resolution Professional to make public announcement of initiation of Corporate Insolvency Process and call for submission of claims under Section 15 as required by Section 13(1)(b) of the Code. Thus, it is evident that the corporate debtor has committed default in payment of operational debt and, therefore, it is a fit case to initiate Insolvency Resolution Process by admitting the Application under Section 9(5)(1) of the Code - petition admitted - moratorium declared. 2020 (10) TMI 678 Maintainability of application - initiation of CIRP - Corporate Debtor's failure to reduce or liquidate its liability - HELD THAT:- The invoices on the basis of which the Operational Creditor claimed the amount are referred in Para-1 of the demand notice and at Para-7 the document which are enclosed with the demand notice are also shown - further, the invoice raised on 12th December, 2015 regarding the supply of 30 numbers of Hippo Vehicle tracker are also enclosed alongwith the demand notice. Service of SCN - HELD THAT:- The demand notice was delivered. It was delivered in the prescribed form and the unpaid operational debt is shown in the demand notice, even the invoices against which the demand notice was delivered is mentioned at Para-7 of the demand notice - there are no force in the contention raised on behalf of the Corporate Debtor that the demand notice was not properly delivered. Pre-existing dispute regarding the amount/debt raised by the Operational Creditor or not - HELD THAT:- There are no dispute as required under Section 8(2) of the IBC, 2016 has been raised, after receiving the demand notice, therefore, I am unable to accept the contention of the Corporate Debtor that there is a pre-existing dispute between the parties prior to the delivery of the demand notice even after receiving the demand notice no such issue was raised in the reply sent by the Corporate Debtor to the Operational Creditor. Hence, I find, no force in the contention raised by the Corporate Debtor - the amount is still due and there is default and Corporate Debtor is liable to pay that amount. The application under section 9(2) of the Code is complete, at least default of ₹ 3,67,200/- is admitted by the Corporate Debtor and that has not been paid. It is established by the certificate issued by the Axis Bank which is at page number 280 Annexure 19. Hence, there is no payment of unpaid operational debt, the demand notice has been delivered by the Operational Creditor, no notice of dispute has been raised and the amount is more than 1 lakh. Since these contentions are fulfilled then the Adjudicating Authority has no option but to admit the application of the Operational Creditor. Petition admitted - moratorium declared. Service Tax 2020 (10) TMI 677 CENVAT Credit - reverse charge mechanism - It appeared to Revenue that the said amount of cenvat credit amounting to ₹ 49,91,539/- is not admissible to appellant, as cenvat credit is admissible only when such input service/ inputs are used in providing any output service - HELD THAT:- The appellant is entitled to input service credit of ₹ 49,91,591/- in dispute. All the services in question are eligible input services for rendering of output services. There is no dispute as regards receipt of any of the input services. Demand of short paid service Tax - GTA service - recipient of service - non-payment of service tax for renting of immovable property service for the period April, 2011 to September, 2011 - HELD THAT:- The said amount is also not tenable as the said demand was prima facie raised under the impression that the appellant is not entitled to cenvat credit of ₹ 49,91,539/-. Further, we find that the appellant have deposited the service tax as per their calculation and is also evident from the calculation chart and the payment challans brought on record vide miscellaneous application, which was earlier allowed vide order dated 03.12.2019 - further, Revenue have not pleaded that the VCES application filed by the appellant on 24.12.2013 for tax dues upto December, 2012 have been rejected. Even otherwise the appellant have deposited all the taxes, as is evident. The appellant is directed to file a copy of the calculation chart alongwith evidence of payment of service tax before the adjudicating authority for verification. If any amount is found to be short paid, the same shall be deposited on being so pointed out by the adjudicating authority. The excess amount deposited, if any, shall be adjusted in accordance with law - appeal allowed - decided in favor of appellant. 2020 (10) TMI 676 CENVAT Credit - input/input services - renting of immovable property service - advertisement service - business support service - security service - legal consultancy service, etc. - period April, 2010 to June, 2012 - HELD THAT:- The issues in this appeals are no longer res integra and the same have been decided in favour of the appellant by the ld. Commissioner (Appeals) - credit on all services allowed. Appeal allowed - decided in favor of appellant. 2020 (10) TMI 675 100% EOU - Rejection of refund of Service Tax - rejection only ground on which the refund has been rejected is that the closing balance of cenvat credit at the end of the quarter as per ST-3 return was nil which was less than the refund amount for respective quarter - HELD THAT:- The objection of the Department that the appellant has not debited the cenvat credit account before filing the refund claim is not factually correct, in fact the appellants have debited the cenvat credit account before filing the refund claim and the same is clearly shown in the ST-3 returns also - Further, the respondent while rejecting the refund claims has not properly appreciated the condition/limitation envisaged in paragraphs 2(g) and 2(h) in Notification No.27/2012-CE(NT) dt. 18/06/2012. The said paragraph only provides that the amount of refund claim shall not be more than the amount lies in the cenvat credit account at the end of the quarter for which the claim is filed or at the time of filing of refund claim, whichever is less. This condition has been interpreted out of context by the respondent in the impugned order and the respondent has erred in not appreciating the facts as also the condition envisaged in Notification No.27/2012. Interest on delayed refund - HELD THAT:- Reliance placed in the case of RANBAXY LABORATORIES LTD. VERSUS UNION OF INDIA AND ORS. [ 2011 (10) TMI 16 - SUPREME COURT] , wherein the Hon ble Supreme Court has held that interest on delayed refund is payable under Section 11BB of Central Excise Act, 1944 on the expiry of period of three months from the date of receipt of application under Section 11B(1) ibid and not from the date of order of refund or Appellate Order allowing such refund - the appellant is entitled for the interest as per the Apex Court decision in Ranbaxy Laboratories Ltd. Appeal allowed - decided in favor of appellant. Central Excise 2020 (10) TMI 674 Valuation - inclusion of transportation charges received by the appellant in the assessable value - proviso to sub-section (4)(b) of section 11A of the Central Excise Act, 1944 - HELD THAT:- This Bench in a number of cases has, after following the decision of the Hon ble Apex Court in the case of COMMISSIONER OF CUSTOMS AND CENTRAL EXCISE, NAGPUR VERSUS M/S ISPAT INDUSTRIES LTD. [ 2015 (10) TMI 613 - SUPREME COURT] , consistently decided identical issue and held that , Hon ble Apex Court has categorically held that under no circumstances can the buyer s premises be the place of removal. It also made it clear that this fact was not brought to the attention of the Court when the earlier orders were passed. In view of the above, we find that it is now well settled that the buyer s premises can never be the place of removal, therefore the freight from the factory/depot/consignment agent up to the buyer s premises cannot be included in the assessable value, even if the goods are sold or delivered at the buyer s premises. Appeal allowed - decided in favor of appellant.
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