Newsletter: Where Service Meets Reader Approval.
TMI Tax Updates - e-Newsletter
December 3, 2022
Case Laws in this Newsletter:
GST
Income Tax
Customs
Corporate Laws
Insolvency & Bankruptcy
PMLA
Service Tax
Central Excise
CST, VAT & Sales Tax
Indian Laws
Articles
News
Notifications
Highlights / Catch Notes
GST
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Condonation of delay in filing appeal - cancellation of the GSTIN registration of the petitioner - It is true that the petitioner has not filed any application for condonation of delay beyond the initial period of 3 months in terms of Section 107 (1) read with Subsection (4) of the CGST Act, 2017. However, that lapse on the part of the petitioner should not be taken against the petitioner as the extended period of 1 month under Section 107(4) fell within the period of Covid delays from 15.03.2020 till 28.02.2022, as directed to be excluded by the Apex Court - HC
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Restoration / Revocation of cancelled GST registration - as the petitioner has come with the case that he has deposited the entire tax and has filed return in the year 2021, the said Act having not been denied by the State, the rejection of registration solely on the ground of delay in moving the revocation application, is not sustainable in law. - HC
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Seeking pre-arrest bail u/s 438 Cr.P.C. - monetary dispute between the parties - the petitioner had committed fraud by projecting himself to be the proprietor of the firm representing reputed companies - allegation of misusing of GSTIN of another party - if the allegations regarding alleged evasion of GST by the petitioner is excluded for the time being from consideration, then from the contents of the FIR, it strongly appears that there is a financial dispute between the informant and the petitioner. - Bail application rejected - HC
Income Tax
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Capital gain - Addition u/s 50C - "transfer" u/s. 2(47) - Relevancy of date of sale deed - When section 2(47) of the Act specifically deals with “sale‟ under clause (i) to section 2(47) and of the “agreement to sale‟ of property under clause (v) then the assessee cannot plead of being covered under clause (ii) of section 2(47) dealing with the extinguishment of any right. - AT
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Credit for TDS - Income offered to tax on receipt basis - the assessee is eligible to claim credit for TDS in assessment year 2016-17, when such professional income has been offered to tax by the assessee on “receipt” basis, since the assessee has been consistently following cash basis of accounting since inception, even though TDS was deducted on such income in the prior assessment year 2015-16. - AT
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waiver of Interest charged u/s 201 - delay in deposit of TDS - One day delay in debiting the amount from the Assessee’s bank account - delay in deposit of TDS caused by negligence on the part of the Bank - the interests levied by the Revenue authorities are deserves to be waived off - AT
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Revision u/s 263 by CIT - Pr.CIT has not conducted any enquiry after receipt of the reply of the assessee - under the provisions of Section 263 of the Act. Ld. Pr.CIT cannot brush aside the reply of the assessee and set aside the issue to the file of AO for readjudication u/s.263 of the Act without doing any primary investigation. - AT
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Addition 69A - undisclosed income is from business or any other source - unexplained money OR only 8% of the cash deposit u/s 44AD - The burden u/s.69A of the Act is only to give a satisfactory explanation. The facts and circumstances of a given case would be sufficient to draw an inference that receipts can be attributed to only business and no other source. - AT
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Addition of community development expenditure by observing that this expenditure is not related to the business activity of the assessee - In assessee’s case has incurred expenditure to promote the interest of underprivileged and impaired section of society and to gain goodwill of the people living in the area of operation of the assessee. - Explanation 2 to section 37(1) is not applicable - Claim allowed - AT
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Capital gain computation - addition u/s 50C - DVO has done the valuation in a very arbitrary manner. He has preferred rates of nearby plots despite noting himself an instance of lower rate in the same building. When this was pointed out to Ld. CIT(A) by the assessee, CIT(A) rejected the same by holding valuation adopted by assessee’s valuer also has no value - The view is also supported by the newspaper articles referred by the valuer that the actual prevailing transaction rate in the area were much lower than the circle rate - AT
Corporate Law
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Oppression and Mismanagement - minority shareholders - There was no alternative except liquidation or revival of company through other modes including sale of assets to other entity who could revive the company - not taking consent of the Appellants cannot be construed as act of oppression by majority shareholders especially keeping in view that the sale of the assets of the company was for the benefits of all stakeholders including shareholders and the company itself. - AT
Indian Laws
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Suppression of facts from the Court - In view of this conduct of petitioner, a sizable amount of precious time of court is being wasted. We deem it proper to observe that suppression of facts cannot be termed as ‘advocacy’. If a litigant discloses all the facts correctly and then able to convince the court, it can be treated as skill of advocacy. The litigation is neither a game of chess nor a hide and seek game but a search for truth and parties must place their cards on the table - it is deemed proper to dismiss this petition with exemplary cost. - HC
IBC
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Initiation of CIRP - Operational Creditors - existence of pre-existing dispute or not - Careful reading of Section 8(2)(a) of the Code provides that the existence of dispute has to be in respect of the amount so claimed and it is not referable to any kind of dispute such as the one which is highlighted in the present controversy - One thing is clear that the plea of pre-existing dispute has to co-relate with the amount claimed by the Operational Creditor or if a suit or arbitration proceedings is pending then the same should also be related to such dispute - AT
Service Tax
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True Liability - Service Tax Voluntary Compliance Encouragement Scheme (STVCES) - If a true liability is disclosed subsequently by a person it is obvious that the amount earlier declared in the return would be included and it would not disentitle a person from including this amount in the declaration filed under section 106(1) of the Finance Act. There cannot be two amount towards tax dues. - AT
Central Excise
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Rejection of rebate claim - Period of limitation - Merely because there is no reference of Section 11B of the Act either in Rule 18 or in the notification on the applicability of Section 11B of the Act, it cannot be said that the parent statute – Section 11B of the Act shall not be applicable at all, which otherwise as observed hereinabove shall be applicable with respect to rebate of duty claim. - SC
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Valuation - inclusion of freight charges - though the authorities below have given the finding that sales were on FOR destination basis but no evidence in this regard has been discussed - the cost of transportation in the given circumstances is the one which has expressly been excluded in terms of Rule 5 of Valuation Rules. - The freight charges are not includible in the assessable value of liquid CO2 those being separately charged in the invoices and the gas was sold at the time of clearance from the factory of the appellant - AT
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Levy of Central Excise duty - captive consumption - carbon dioxide generated during the process of fermentation of beer and used for its carbonation - carbon dioxide may be an independent product mentioned in the central excise tariff but it was a product that arose in the manufacturing process and would only be seen as an efficient process for manufacture of beer - Not liable to duty - AT
VAT
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Deduction VAT / TDS from the bills by the Recipient of work contract service - Sub-contractor of Main contractor - Non issue to TDS certificate since the amount was adjusted as per the terms of contract - Nothing has been produced by the petitioner which would reveal deduction on account of VAT for the works contract of M/s Hindustan Steel Works Construction Limited, for which the respondent-M/s Hindustan Steel Works Construction Limited is under a duty to issue certificate in Form-JVAT 400. - HC
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Input tax credit - cancellation of license of three dealers - Registration / license of supplier dealers have been cancelled - Due to the cancellation of the license of these 3 dealers, the respondents disbelieved all the 17 transactions and disallowed the benefit of input tax rebate to the petitioner. Therefore, the manner in which the impugned order dated 23.6.2011 has been passed, no stamp of approval can be given in these wit petitions. - HC
Case Laws:
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GST
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2022 (12) TMI 89
Condonation of delay in filing appeal - cancellation of the GSTIN registration of the petitioner - HELD THAT:- The period of 3 months counting from the order-in-original dated 14.12.2019 would have expired on 13.03.2020. As such, the petitioner could have preferred an appeal with an explanation within a further period of 1 month from 13.03.2020, which he failed to do and ultimately preferred the appeal on 25.09.2021. The delay in filing the appeal persuaded the learned appellate authority to reject the application on ground of limitation. The Apex Court in Suo Motu Writ Petition has directed extension of the period of limitation in all proceedings before Court / Tribunal including the Apex Court w.e.f. 15.03.2020, initially vide order dated 08.03.2021 [ 2021 (3) TMI 497 - SC ORDER] . The said period was subsequently extended by orders passed by the Apex Court from time to time and lastly up to 28.02.2022 vide order dated 10.01.2022 [ 2022 (1) TMI 385 - SC ORDER] . It is true that the petitioner has not filed any application for condonation of delay beyond the initial period of 3 months in terms of Section 107 (1) read with Subsection (4) of the CGST Act, 2017. However, that lapse on the part of the petitioner should not be taken against the petitioner as the extended period of 1 month under Section 107(4) fell within the period of Covid delays from 15.03.2020 till 28.02.2022, as directed to be excluded by the Apex Court. The matter is remanded to learned appellate authority i.e., Joint Commissioner (Appeal), CGST, Ranchi to decide the appeal on its own merits - Petition allowed.
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2022 (12) TMI 88
Transitional Credit - grievance of petitioner is that they could not undertake the Tran-1 and Tran-2 transactions as because the GST portal was closed in the meantime - HELD THAT:- In the instant case, the petitioner assessee has made a statement that they are willing to file all the required returns as well as pay all the dues as may be assessed by the Finance and Taxation Department of the Government of Assam. In this respect the case of MAYFLOWER HOTELS AND RESORTS LLP VERSUS THE PRINCIPAL COMMISSIONER OF STATE GOODS AND SERVICE TAX AND 3 ORS. THE JOINT COMMISSIONER STATE TAXES (APPEALS) , THE ASSISTANT COMMISSIONER STATE TAXES GUWAHATI, THE SUPERINTENDENT OF STATE TAXES, GUWAHATI [ 2022 (10) TMI 951 - GAUHATI HIGH COURT] is referrred, wherein in a circumstance where the GST registration was cancelled for non-submission of returns and non-payment of dues, it was provided that the assessee and the department will sit together where the department will inform the assessee as to what is the exact amount of due tax as well as the interest that the assessee may be required to pay on such non-payment of taxes as well as penalty, if any, under the law and the quantified amount would be paid by the assessee to the department and upon it being paid, the department will restore back the registration either in the form of the earlier registration or by providing a new registration number. In the instant case, as because we have already taken note that the petitioner assessee is willing to do all the needful as required by the respondent Department i.e. whatever taxes be assessed will be paid by the petitioner and if interest thereupon will be levied, the same be also paid as well as the penalty, if any, under the law - once the representative of the petitioner will be before the Superintendent of Goods and Services Tax, Guwahati, the Superintendent of Goods and Services Tax will inform the petitioner the total amount of taxes they are required to be paid including the interest and penalty and the petitioner will give a written undertaking in an indemnity bond to the Superintendent of Goods and Services Tax that they are willing to pay the amount. The petitioner to initiate and agree with any amount as may be assessed by the Department as regards the tax, interest and penalty, if any, and pay the same as indicated above and later on, if the petitioner is of the view that there was any over assessment, the petitioner will be at liberty to file appropriate application - Petition disposed off.
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2022 (12) TMI 87
Cancellation of registration of the petitioner under the U.P. Goods and Services Tax Act, 2017 - non-filing of return within time - HELD THAT:- It is not in dispute that due to non filing of the return by the petitioner a show a cause notice was given to him by the Taxing Authority on 29.4.2019, against which no reply was filed by the petitioner and the cancellation of registration came into effect from 14.5.2019 as stated in the said show cause notice. The assessee after coming to know about the cancellation of registration had deposited the entire tax on 30th January, 2021 and had also filed return before the concerned authority. On 17.2.2021 the Assistant Commissioner rejected the revocation application of the petitioner on the ground that the return was not filed within time. The appeal of the petitioner was also rejected by the First Appellate Authority on the ground that the return was not filed within time. In the present case, as the petitioner has come with the case that he has deposited the entire tax and has filed return in the year 2021, the said Act having not been denied by the State, the rejection of registration solely on the ground of delay in moving the revocation application, is not sustainable in law. Moreover, the Appellate Authority has not recorded any categorical finding as to the service of notice and merely on the ground that the application was time barred, proceeded to uphold the order of rejection of revocation application. Considering the facts and circumstances of the case, the orders dated 14.5.2019 and 25.3.2021 passed by the opposite parties are unsustainable in the eye of law and are hereby quashed. Petition allowed.
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2022 (12) TMI 86
Principles of natural justice - non-speaking order - whether the impugned notice itself is in total non-application of mind since the notice was issued on 27th October, 2022 and petitioner was asked to appear before the adjudicating authority on 3rd October, 2022 which had already been expired long back? - seeking release of the goods and vehicle - breakdown of the vehicle and the period was less than 24 hours. HELD THAT:- Considering the facts and circumstances of this case, the impugned order dated 4th November, 2022 being Annexure P-9 to the writ petition is set aside and the matter is remanded back to the adjudicating authority concerned to pass a fresh speaking order after giving an opportunity of hearing as well as allowing the petitioner to make fresh appropriate representation against the aforesaid show-cause notice dated 27th October, 2022. Petition disposed off.
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2022 (12) TMI 85
Seeking grant of bail - availment of irregular input tax credit - non-existing firms and suppliers - offences u/s 132 of CGST Act - HELD THAT:- It is evident that applicant and Paras Jain @ Rohan Jain control and operate alleged firms. The allegations against co-accused and applicant are similar and co-accused Paras Jain @ Rohan Jain has been granted bail by co-ordinate Bench of this Court and applicant's case is similar with co-accused, who has been granted bail and keeing in view the nature of offence, evidence, complicity of accused and without expressing any opinion on the merits of the case and larger mandate of the Article 21 of the Constitution of India, SATENDRA KUMAR ANTIL VERSUS C.B.I. AND ANOTHER [ 2021 (10) TMI 1296 - SUPREME COURT] , the Court is of the view that the applicant has made out a case for bail. The bail application is allowed - Let the applicant, Jagvinder Singh, who is involved in the aforesaid case crime, be released on bail on his furnishing a personal bond and two sureties each in the like amount to the satisfaction of the court concerned subject to conditions imposed.
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2022 (12) TMI 84
Seeking pre-arrest bail u/s 438 Cr.P.C. - monetary dispute between the parties - the petitioner had committed fraud by projecting himself to be the proprietor of the firm representing reputed companies - allegation of misusing of GSTIN of another party - HELD THAT:- The informant has not produced any deed of partnership between Anjuman Kumar Sharma and the petitioner in respect of M/s. NRI Group of Industries. To oppose this bail application, the informant is heavily relying on the statement made in AB 257/2022 before Sessions Judge, Kamrup, Amingaon wherein he had stated that the Anjuman Kumar Sharma and the petitioner are partners. However, in the affidavit-in-opposition filed by the informant, the informant has made a statement that Anjuman Kumar Sharma and his wife Pooja Sharma are partners of Zentic Pharmaceuticals. It is not known as to whether the said Anjuman Kumar Sharma has the exclusive right to use the name of M/s. NRI Group of Companies in exclusion of all others or that use of the same firm name by the petitioner would constitute a cognizable offence. Therefore, if the allegations regarding alleged evasion of GST by the petitioner is excluded for the time being from consideration, then from the contents of the FIR, it strongly appears that there is a financial dispute between the informant and the petitioner. There is no allegation that the petitioner is selling goods by ecommerce by impersonating as M/s. Zentic Pharmaceuticals, as projected in the affidavit-in-opposition filed by the informant. Therefore, the said point is immaterial for consideration in this bail application. Bail application rejected.
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2022 (12) TMI 83
Reopening of common portal for filing concerned forms for availing transitional credit through TRAN-1 TRAN-2 for two months - HELD THAT:- Considering the judgments of the High Courts on the then prevailing peculiar circumstances, any aggrieved registered assessee is directed to file the relevant form or revise the already filed form irrespective of whether the taxpayer has filed writ petition before the High Court or whether the case of the taxpayer has been decided by Information Technology Grievance Redressal Committee (ITGRC). GSTN has to ensure that there are no technical glitch during the said time - the concerned officers are given 90 days thereafter to verify the veracity of the claim/transitional credit and pass appropriate orders thereon on merits after granting appropriate reasonable opportunity to the parties concerned. Petition disposed off.
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Income Tax
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2022 (12) TMI 82
Reopening of assessment u/s 147 - non considering objection to the notice u/s 148A(b) - violation of principle of natural justice by not taking into consideration the petitioners objection to the notice u/s 148A(b) which was filed within the time asked for by AO - HELD THAT:- Considering the facts and circumstances of this case as appears from record and in the interest of justice and taking into consideration the principle of observation of natural justice the aforesaid impugned order u/s 148A(d) is set aside and the matter is remanded back to the assessing officer to pass a fresh speaking order in accordance with law after giving an opportunity of hearing to the petitioner or its authorized representatives within a period of eight weeks from the date of communication of this order.
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2022 (12) TMI 81
Disallowance u/s 14A r.w.r.8D - disallowing any expenditure incurred in relation to the exempt income - HELD THAT:- This Court is of the view that the present case is covered by the Division Bench judgment in Cheminvest Ltd. [ 2015 (9) TMI 238 - DELHI HIGH COURT] wherein it has been held that the expression 'does not form part of the total income' in Section 14A of the Act means that there should be an actual receipt of income which is not includible in the total income, during the relevant previous year for the purpose of disallowing any expenditure incurred in relation to the said income. In other words, Section 14A will not apply if no exempt income is received or receivable during the relevant previous year. Also amendment of Section 14A, which is for removal of doubts cannot be presumed to be retrospective even where such language is used, if it alters or changes the law as it earlier stood. See M/S. ERA INFRASTRUCTURE (INDIA) LTD. [ 2022 (7) TMI 1093 - DELHI HIGH COURT] - Decided in favour of assessee.
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2022 (12) TMI 80
Reopening of assessment u/s 147 - validity of order passed u/s 148A(d) - proceedings conducted on deactivated PAN - as stated assessee had filed no response on the merits of the case - HELD THAT:- Interest of justice would be served if the Petitioner is given an opportunity to file a supplementary reply to the notice issued under Section 148A(b) - Consequently, the impugned order passed under Section 148A(d) of the Act and the notice issued u/s 148 are set aside and the Petitioner is directed to file a supplementary reply to the notice issued under Section 148A(b) of the Act within four weeks. AO shall pass a fresh order under Section 148A(d) within eight weeks thereafter in accordance with law. Since the proceedings are being conducted on a deactivated PAN, the Assessing Officer is directed to entertain emails / hard copies of the replies / materials / evidences filed by the Petitioner. Present writ petition along with pending applications stands disposed of.
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2022 (12) TMI 79
Reopening of assessment u/s 147 - Necessity of disposing of the objections - petitioner has claimed bogus LTCG on penny stock transaction - HELD THAT:- We noticed that in today s date, this Court has disposed of two of the matters being Special Civil Application [ 2022 (11) TMI 1269 - GUJARAT HIGH COURT] and [ 2022 (11) TMI 1268 - GUJARAT HIGH COURT] wherein the assessment made is nil and they were the part of the very group, therefore, nothing can be presumed in advance and the stage of disposing of the objections will need to be made available to the respondent authority. Petition being prematured, this Court chooses not to entertain it at this stage. Let the disposal on the strength of the objections raised by the petitioner be made by the authority concerned within two weeks from the date of receipt of copy of this order, on availing opportunity in accordance with law. If any adverse order is passed, no effect be given to the same by the Revenue for two weeks. The petitioner will be at liberty to take legal course within this period of two weeks, if it so chooses.
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2022 (12) TMI 78
Validity of reopening u/s 147 - Reason to believe - case reopened on the basis of information gathered in the ITD system that assessee has made time deposit in IDBI Bank but no return of income was filed - HELD THAT:- As assessee neither before the AO nor before Ld.NFAC/CIT(A) and finally before me filed any submission or documents to substantive his case as to why the reopening is not valid. In my view, as assessee has not filed any return of income though assessee was given due opportunity before reopening by issuing query letter and seeking source of his investment. None of the notice / show cause notice or notice under section 148 was responded by the assessee. Therefore ground Nos. 1 and 2 of assessee are dismissed. Deposit in IDBI bank and State Bank of India - AO made both the additions in absence of any explanation or evidence produced by assessee. NFAC/CIT(A) granted partial relief with regard to deposit / credit in State Bank of India about the credit of salary. No other evidence to substantiate the source of investment filed nor any written submission is filed before me. Therefore, in absence of any explanation on the part of assessee, no merit in the ground No.s 3 4 raised by assessee
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2022 (12) TMI 77
Reopening of assessment u/s 147 - reason to believe - sustainability of the assessment framed by the A.O without making available a copy of the reasons to believe to the assessee who after duly complying with the notice u/s 148 of the Act is stated to have specifically requested for the same - HELD THAT:- As it transpires that not only the assessee had in unequivocal terms brought to the notice of the CIT(A) that he had after complying with the notice u/s.148 requested the AO for a copy of the reasons to believe that formed the very basis for reopening of its case u/s.147 but in fact had relied on a plethora of judicial pronouncements wherein various Courts had held that framing of an assessment by the A.O without providing to the assessee a copy of the reasons to believe would render the assessment order as bad in law. Admittedly, though the assessee had categorically assailed before the CIT(Appeals) the validity of the assessment order passed by the A.O u/s.147/143(3) on the ground that the same having been framed de-hors making available a copy of the reasons to believe forming the very basis for reopening of the case of the assessee could not be sustained for want of valid assumption of jurisdiction, however, we find that the same had not been disposed off by the CIT(Appeals). Considering all the matter requires to be revisited by the CIT(Appeals), who shall in the course of the set-aside proceedings deal with the claim of the assessee qua the validity of the order passed by the A.O u/s.147/143(3) of the Act without making available a copy of the reasons to believe on the basis of which proceeding u/s.147 of the Act were initiated in the case of the assessee, specifically when a request for the same was made by the assessee after complying with the notice u/s.148. Thus principally concur with the position of law canvassed by him qua the validity of the assessment order passed by the A.O u/ss.147/143(3), without making available to the assessee a copy of the reasons to believe that had formed the very basis for reopening of its case u/s.147. Thus the failure on the part of the A.O to make available to the assessee a copy of the reasons to believe , which forms the very basis for reopening of his case goes to the root of the validity of jurisdiction that was assumed by him for framing the assessment. For the reason that when an assessee despite a specific request for a copy of the reasons to believe is not provided with the same by the A.O, then, he remains divested of his statutory right of objecting to the very basis on which proceedings u/s.147 of the Act were initiated in his case. In a case where there is a complete violation of the applicable principle of law by the A.O, who despite a specific request by the assessee had failed to communicate to him the reasons to believe that had formed the very basis for reopening of his assessment u/s.147 of the Act, then, the very assumption of jurisdiction by him and framing of the impugned assessment cannot be sustained and is liable to be struck down on the said count itself. The aforesaid view is supported by the judgment in the case of Agarwal Metals and Alloys [ 2012 (8) TMI 612 - BOMBAY HIGH COURT] . Thus restore the matter to the file of the CIT(Appeals) for the limited purpose of verifying the veracity of the assessee s claim that despite his specific request no copy of the reasons to believe were made available to him by the A.O, and in case the same is found to be in order, then, pass an order in terms of aforesaid observations. Appeal of the assessee is allowed for statistical purposes.
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2022 (12) TMI 76
Deduction u/s 80P - exemption of interest income received from other cooperative society u/s 80P(2)(d) - AO was of the opinion that the interest income so received is not eligible for exemption u/s 80P(2)(d), as the said income was received from non-members of the society - HELD THAT:- Reasoning of the Assessing Officer as well as the ld. CIT(A) was overruled by the Co-ordinate Bench of this Tribunal in the case of The Ugar Sugar Works Kamgar Dr. Shirgaokar Shaikshanik Trust Nokar Co-op Credit Society [ 2021 (11) TMI 1117 - ITAT PANAJI] in favour of the appellant society. Thus the interest income is eligible for deduction u/s 80P(2)(d) - we direct the Assessing Officer to allow the same. Hence, the ground of appeal no.1 stands allowed. Additions made u/s 40(a)(ia) and section 36(1) of the Act - HELD THAT:- As the inflated profits on account of such disallowances, would also qualify for deduction u/s 80P(2)(a)(i) of the Act. Hence, direct the Assessing Officer to allow the above disallowances which form part of the business income of the appellant society for exemption u/s 80P of the Act. Accordingly, ground of appeal nos.2 and 3 stands allowed.
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2022 (12) TMI 75
Capital gain - Addition u/s 50C - transfer u/s. 2(47) - Relevancy of date of sale deed - nature of land was agricultural - crucial date for determining transfer for the purpose of section 2(47) of the Act when the date of agreement for sale of property is different from the date of registration of sale deed - agreement to sale creates some rights in favour of the transferee and it is a transfer within section 2(47) - As submitted plot has treated as industrial plot only for the purpose of sale deed as purchaser has purchased an agricultural land for industrial purpose - HELD THAT:- This bench takes note of clause (v) of section 2(47) of the Act which provides that if a transfer‟ involves handing over of possession of any immovable property in part performance of a contract of the nature referred to in section 53A of the TP Act 82 that shall be included in the definition of transfer of capital asset. In the case in hand although fact of registration of agreement to sale is not disputed however, the possession was not handed over. Thus, strictly speaking provisions of section 53A of the TP Act are not applicable. There was no deemed transfer. In case in hand the matter has to be considered for a charging section 45 read with Section 2(14) of the Act and the relevant is Section 47 of the Registration Act 1908, whereby it is provided that registered document shall operate from the date of its execution. It is the date of the execution of the registered deed and on that date alone, the title to property passes. When section 2(47) of the Act specifically deals with sale‟ under clause (i) to section 2(47) and of the agreement to sale‟ of property under clause (v) then the assessee cannot plead of being covered under clause (ii) of section 2(47) dealing with the extinguishment of any right. First proviso of section 50C(1) provides that where the date of agreement fixing the value of consideration for transfer of the assets and the date of registration of such transfer of asset not the same, then the stamp value may be taken as the value adopted or assessed or assessable by any authority of a state Govt. for the purpose of payment of stamp duty in respect of such transfer on the date of agreement. Provision to section 50C(1) provides that the provision of first proviso to section 50C(1) shall apply only in case where the amount of consideration or a part thereof has been received by way of an account payee cheque or account payee bank draft of use of electronic clearing system through a bank account on or before the date of the agreement for transfer of the asset. This makes it crystal clear that the Act also intends to take the date of sale deed to be relevant for purpose of ascertaining the nature of assets and only as exception u/s 50C(1), the agreement to sell is relevant. Thus, for the purpose of determining the nature of capital assets and consequent calculation of capital gains, the relevant date would be when the right, title or interest got extinguished in vendor and in substance same vested in the vendee. As the case is covered by Section 2(47)(i) of the Act, the relevant date is execution of sale deed and as admittedly on date of execution of sale deed, the land was not of the nature of agricultural land and stood converted as industrial plot, benefit of Section 2(14) of the Act could not have been extended to the assessee. So there is no error in the findings of Ld. Tax authorities below. Appeal dismissed.
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2022 (12) TMI 74
Credit for TDS - Income offered on receipt basis - whether assessee is eligible to claim credit of TDS in assessment year 2016-17, when the assessee offers this income on receipt of the same since the assessee is following the cash basis of accounting and offers income on receipt basis? - HELD THAT:- ITAT Ahmedabad on identical set of facts in the case of Chirag M Shah [ 2022 (6) TMI 236 - ITAT AHMEDABAD] has also held that the assessee is entitled to get credit of TDS in the year in which he has offered to tax the professional fees income on receipt basis i.e. by following cash basis of accounting, even though the client/deductor had deducted tax in earlier years by following an accrual basis of accounting. ITAT Chennai Bench in the case of Supreme Renewable Energy Ltd. [ 2008 (8) TMI 432 - ITAT MADRAS-C] held that when a particular income is received by assessee after deduction of tax at source and said TDS has been duly deposited with the Government and the assessee has received requisite certificate to this effect, then on production of the said certificate the assessee becomes entitled to credit of TDS, even if the assessee has not directly offered said income for tax as the assessee considers that same is not liable for tax. We are of the considered view that the assessee is eligible to claim credit for TDS in assessment year 2016-17, when such professional income has been offered to tax by the assessee on receipt basis, since the assessee has been consistently following cash basis of accounting since inception, even though TDS was deducted on such income in the prior assessment year 2015-16. Appeal of the assessee is allowed.
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2022 (12) TMI 73
waiver of Interest charged u/s 201 - one day delay in deposit of TDS - delay in deposit of TDS caused by negligence on the part of the Bank - Whether the payment would be deemed to have been made on the date of handing over of cheque to the banker or on the date of clearance of cheque by debiting the Assessee s account for the purpose of tendering the TDS? - HELD THAT:- In the instance case, there is One day delay in debiting the amount from the Assessee s bank account which is apparently due to the mistake to the banker. Further by relying on the ratio laid down in the case of Standard Chartered Bank [ 2020 (8) TMI 665 - ITAT MUMBAI] we are of the opinion that the payment of TDS by the assessee would relate bank to the date of presentation of the cheque i.e. on 31/07/2013 by the assessee to the banker. Therefore, the interests levied by the Revenue authorities are deserves to be waived off. Accordingly, we allow the Grounds of Appeal of the assessee.
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2022 (12) TMI 72
Disallowance of remuneration paid to working partners - As argued working partners had paid tax on the sums received by them at maximum marginal rate - assessee is a partnership firm of advocates and derives income from profession and other sources - AO was of the view that unless the remuneration to be paid to the partners is quantified in the partnership deed, it will not be allowed as deduction at the hands of the partnership firm - HELD THAT:- Since, the partners had offered the remuneration received as income, they filed rectification applications u/s 155 before the AO and the AO has passed orders under Section 155(1A) of the Act rectifying the assessment of the partners by reducing the income received by way of remuneration, thereby, granting the desired relief at the hands of the partners. Since, rectification orders have been passed in respect of the partners, the ground raised becomes in-fructuous. Disallowance of deduction claimed u/s 80G - assessee had claimed deductions u/s 80G, however, the Assessing Officer overlooked assessee s claim - HELD THAT:- Considering the fact that the Departmental Authorities have not decided assessee s claim of deduction under Section 80G of the Act and in any case of the matter, assessee s rectification application on the issue is pending before the Assessing Officer, we restore the issue to him with a direction to examine assessee s claim of deduction under Section 80G of the Act with reference to the supporting evidences filed by the assessee.Assessing Officer must decide the issue in accordance with law after providing due opportunity of being heard to the assessee.
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2022 (12) TMI 71
Rectification of mistake u/s 154 - short credit of TDS - Assessee s contention is that the aforesaid rectification application has not yet been disposed of by the Department - HELD THAT:- As it clearly appears from record that the Assessee did not file proper application signed by it u/s 154 of the Act for efficacious remedy, therefore rightly not entertained by the AO however considering the magnitude, the peculiar facts and circumstances of the case and to cut short the litigation, we deem it appropriate as the parties also agreed, to direct the AO to verify the claim of TDS and grant the credit, if the Assessee is entitled to, suffice to say by disposing of the rectification application referred to above filed by the Assessee within a period of 03 months and by affording reasonable opportunity of being heard to the Assessee. As we have directed the AO to dispose of the Rectification Application filed by the Assessee u/s 154 of the Act for efficacious remedy, hence in our considered view, there is no need to decide this appeal on merit.
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2022 (12) TMI 70
Revision u/s 263 by CIT - WIP for multiple years - HELD THAT:- The assessee in his reply, which has been extracted in Pr.CIT s order, submitted that he has explained that the mistake was on account of the typographical error. To substantiate this that the assessee has produced the WIP in respect of the assessment years i.e. for the F.Ys.2012-2013, 2013-2014 and for the relevant F.Y.2014-2015, it is at this point that the ld. Pr.CIT took the stand that the WIP is identical as closing stock for multiple years. Therefore, this is not the issue which was raised in the show cause notice. Once it is not the issue that was raised in the show cause notice, such an issue cannot be directed in a revision proceeding u/s.263 of the Act. TDS in respect of payments made towards equipment hire charges, location/camp hire charges and vehicle hire charges - receipt u/s.194C 194J of the Act as per 26AS are more than the receipt shown in the ITR - HELD THAT:- TDS has been looked into by the AO in the course of the assessment proceedings. He has already taken a view. The assessee has also categorically admitted that to such extent where TDS is liable to be done, the TDS has been deducted and where payment was less than Rs.30,000/-, no TDS has been deducted. Admittedly, the Pr.CIT in his wisdom failed to consider the issue even after receipt of the reply of the assessee. This clearly shows that the Pr.CIT has not conducted any enquiry after receipt of the reply of the assessee. This is not permitted under the provisions of Section 263 of the Act. Ld. Pr.CIT cannot brush aside the reply of the assessee and set aside the issue to the file of AO for readjudication u/s.263 of the Act without doing any primary investigation. As the first issue of WIP is not an issue arising from the show cause notice issued u/s.263 of the Act and the second issue is an issue which has already been considered by the AO and no investigation has been done by the ld. Pr.CIT, we are of the view that the order passed u/s.263 of the Act is unsustainable and consequently we quash the same. Appeal of the assessee is allowed.
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2022 (12) TMI 69
Unexplained cash deposits - Declaration of cash under IDS - cash deposit during the demonetization period - Case selected for scrutiny under the Computer Aided Scrutiny Selection (CASS) on the issues of large exempt income and large value of cash deposits during demonetization period - HELD THAT:- It is only when a final certificate is issued in respect of income declared and accepted under IDS, could the same possibly be considered as so in law, while the same is admittedly not available with the assessee even at this stage. No inquiry in the matter was made by the AO, ascertaining its status as the final acceptance of the assessee s application, other things aside, is of vital significance to it s explanation as to the nature and source of the cash deposited in his bank account during the relevant previous year w.r.t. the income declared under IDS. More recently, the Hon ble Apex Court in Dy. CIT v. M.R. Logistics (P.) Ltd. [ 2022 (4) TMI 46 - SUPREME COURT] held that merely because there has been a declaration under IDS, 2016, which in that case was of a related party, the same, unless linked with the impugned receipt, would not prove the same, again emphasizing that the matter, as clarified earlier, is primarily factual, and would therefore stand to be determined on the basis of firm factual findings, found absent in the instant case. We, for the reasons afore-stated, find no reason to interfere. We may also add that our findings may not be, apart from bearing a general character clarifying on the legal as well as the factual aspects, regarded as final, foreclosing the assessee s case as the same stands set aside for a de novo consideration to the AO, who shall decide the same per a speaking order having regard to the entirety of the facts and circumstances of the case, and the evidences that may be led or explanations furnished before him. We may before parting with this order also clarify that though the ld. Pr. CIT had called for comments from the incumbent AO, as apparent from his order, his findings are based on his examination of the record and due application of mind, with in fact the comments called for being after eliciting the assessee s replies dated 27/7/2021 25/11/2021, so that no adverse inference arises from the calling of comments from the AO, and are only facilitative. Assessee s appeal is dismissed.
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2022 (12) TMI 68
Addition 69A - undisclosed income is from business or any other source - unexplained money OR only 8% of the cash deposits has to be brought to tax u/s 44AD treating the same as assessee s turnover in the business of construction contracts - undisclosed income is from business or any other source - HELD THAT:- The explanation offered by the assessee that such deposits are from his contract business as a plausible explanation in absence of anything contrary on record in terms of any other source of income. Admittedly, the assessee also undertakes civil construction contracts. The partnership firm in which the assessee is a partner is also in the business of construction. The details of the contract work with Ursuline Sister of Mary Immaculate Educational Society were furnished by the assessee. The burden u/s.69A of the Act is only to give a satisfactory explanation. The facts and circumstances of a given case would be sufficient to draw an inference that receipts can be attributed to only business and no other source. The decision in the case of Balchand Ajitkumar [ 2003 (4) TMI 76 - MADHYA PRADESH HIGH COURT ] also supports the plea of the assessee. Therefore accept the plea of the assessee that 8% of the cash deposits/cash credit, be treated as income of assessee from business of civil construction and the said sum be taxed in lieu of taxing the entire cash deposits in the bank account/cash credit.Therefore partly allow all these appeals.
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2022 (12) TMI 67
Rectification u/s 154 - Addition of community development expenditure by observing that this expenditure is not related to the business activity of the assessee and is not admissible expenditure under the provision of sec. 37(1) - assessee submitted that these expenses were incurred before the amendments in sec. 37(1) and CSR (Corporate Social Responsibility) is allowable as business expenditure incurred by the company, which is in the nature of the business expenditure of the company - HELD THAT:- Disallowance under Explanation 2 to section 37(1) comes into play, but, as for latter, there is no such disabling provision as long as the expenses, even in discharge of corporate social responsibility on voluntary basis, can be said to be wholly and exclusively for the purposes of business . There is no dispute that the expenses in question are not incurred under the aforesaid statutory obligation. For this reason also, as also for the basic reason that the Explanation 2 to section 37(1) comes into play with effect from 1st April 2015, we hold that the disabling provision of Explanation 2 to section 37(1) does not apply on the facts of this case. In assessee s case has incurred expenditure to promote the interest of underprivileged and impaired section of society and to gain goodwill of the people living in the area of operation of the assessee. Therefore respectfully following the decision of Gujarat Narmada Valley Fertilizers Chemicals Ltd. [ 2019 (8) TMI 1288 - GUJARAT HIGH COURT] we hold that Explanation 2 to section 37(1) is not applicable to the assessee s case and therefore the expenses incurred voluntarily by the assessee towards CSR expenditure is allowable u/s 37(1). We also allow the appeal of the assessee.
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2022 (12) TMI 66
TDS u/s 194A - Addition u/s 40(a)(ia) - interest on loan borrowed - Non deduction of TDS - admission of the aforesaid additional evidences - HELD THAT:- Failure on the part of the CIT(A) to communicate this (erroneous) requirement, if in her opinion this was a necessary requirement, to the appellant assessee, and, to then instead refuse the admission of additional evidences; was unjust, unfair and harsh. We order the admission of the aforesaid additional evidences in the nature of certificates issued by the learned Chartered Accountants under Rule 201(1) of IT Act, which were filed by the assessee in the course of appellate proceedings in the office of the CIT(A). We restore the issue regarding allowability of interest expenses amounting to rupees aforesaid total amount to the file of the AO with the direction to pass denovo order on the specific issue of allowability of aforesaid amount after taking due cognizance of the aforesaid additional evidences and after providing reasonable opportunity to the assessee. We specifically clarify that the AO will be at liberty to carry out due verification of the aforesaid additional evidences; and further, to examine the purpose of the interest payment to M/s Bajaj Finance Ltd. having regard to the assessee s business/profession; before finalizing fresh order, for coming to a conclusion about its allowability. All the grounds of appeal are treated as disposed of in accordance with aforesaid directions. For statistical purposes this appeal is partly allowed.
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2022 (12) TMI 65
TP Adjustment - Comparability - CTIL should be excluded from the comparable set - CTIL has subcontracted majority of its software development work to 3rd party vendors and has made significant payments to these vendors to the extent of 53-72% of total cost/27.85% of software development income - HELD THAT:- As it is well established principle that the company which does most of these activities through its own employees is not functionally comparable to a company which outsources majority of its work to third party vendors. In view of the above, we are of the considered view that CTIL should be excluded from the list of comparables, since CTIL is functionally different from that of the assessee company. Appeal of assessee allowed.
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2022 (12) TMI 64
Capital gain computation - addition u/s 50C - AO sent the matter to the DVO and as matter was getting time barred, without waiting for the DVO s order, he added the difference between the sale value and circle rate - assessee contended that sale instances of the property located in the same building were filed by the assessee before the ld. CIT(A), which the Ld. CIT(A) has not considered - HELD THAT:- As decided in MS. MADHU SHARMA. case [ 2004 (3) TMI 341 - ITAT DELHI-C] comparison should be done among instances which are relatively near. In the present case, the DVO despite noting the instances himself has not followed the valuation done for the same property but had preferred to take into account adjacent building without any reason. We find considerable cogency in the assessee s submissions that DVO s approach is not correct. DVO has done the valuation in a very arbitrary manner. He has preferred rates of nearby plots despite noting himself an instance of lower rate in the same building. When this was pointed out to Ld. CIT(A) by the assessee, CIT(A) rejected the same by holding valuation adopted by assessee s valuer also has no value. We do not find ourselves in agreement with the view of CIT(A). The assessee s valuer has duly mentioned and taken into account these instances of the same building. This as per the ratio emanating from the decision of Madhu Sharma [ 2004 (3) TMI 341 - ITAT DELHI-C] is the correct method. Moreover, this view is also supported by the newspaper articles referred by the valuer that the actual prevailing transaction rate in the area were much lower than the circle rate . These aspects have not been rebutted by the revenue authorities. Hence, in our considered opinion, the order of the Ld. CIT(A) deserves to be set-aside - Assessee s appeal is allowed.
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2022 (12) TMI 63
Penalty u/s 271(1) - Validity of notice u/s 274 - As argued notice initiated by the AO was not determined the allegation of the assessee whether it is concealed income or furnished inaccurate particular of income - HELD THAT:- This particular notice it is a self-defective and the ld. AO did not mention the nature of concealment in the notice issued u/s 274/271(1)(c). The counsel laid down that in the absence of such specific notice, the notice would be invalid as held in various judicial pronouncements including the decision of Hon ble Karnataka High Court in CIT V/s SAS s Emerald Meadows [ 2015 (11) TMI 1620 - KARNATAKA HIGH COURT] against which Special Leave Petition (SLP) filed by the department stood dismissed by Hon ble Supreme Court which is reported [ 2016 (8) TMI 1145 - SC ORDER] - The notice u/s 274/271(1)(c) of the Act is not carrying the specific limb. Therefore, this is a case where both the parts of the offences i.e., concealment of income as well as furnishing of inaccurate particulars of income were involved. The decision of Jaipur Tribunal (Third Member) in the case of Grass Field Farms and Resorts P. Ltd. [ 2015 (9) TMI 1585 - ITAT JAIPUR] was referred to confirm the impugned penalty. Appeal of the assessee is allowed.
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Customs
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2022 (12) TMI 62
Smuggling - foreign currency - absolute confiscation - penalty - compounding of offence under Section 137 of the Customs Act, 1962 - HELD THAT:- Taking note of the totality of facts and circumstances of the case, more particularly the fact that the foreign currency amounting to Rs.65,00,000/- has already been confiscated absolutely and the fair submissions made on behalf of the appellant, we are inclined to accept the offer made by her i.e., of depositing Rs.6,50,000/- being the entire amount of penalty as per the Order-in-original dated 08.02.2022 and then, a sum of Rs.1,00,000/- towards compounding of offence under Section 137 of the Customs Act, 1962. It is not found necessary or expedient to relegate the appellant to the process of hearing before the Commissioner of Customs; rather we are of the view that interest of justice shall be served by modification of the order in terms of the proposition advanced on behalf of the appellant. Appeal allowed in part.
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Corporate Laws
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2022 (12) TMI 60
Oppression and mismanagement of the Respondent No. 1 Company - section 421 of the Companies Act, 1956 - alleged illegal allotment of 984 shares - participation of interested directors in the board meeting for allotment of 984 shares - the conduct of 61st and 62nd AGMs, wherein the resolutions relating to alleged illegal allotment of 984 shares were approved - resolutions relating to Joint Development Agreement relating to the property of R-1 Company were also approved - non-registration of shares transfer - non-payment of dividend - restriction on shareholders voting rights under Article 15 of the R-1 Company s Articles of Association. Allotment of 984 unsubscribed shares - HELD THAT:- The AoA of R-1 Company indicates the right of the Directors to allot the shares. Article 4 of the AoA stipulates that the shares shall be under the control of the Directors, who may allot or otherwise dispose of the same to such persons on such terms and conditions and at such times, as the Directors think fit, and with full powers to give any person the call on any shares either at par or at a premium and for such time and for such consideration as the Directors think fit - the inquiry report mentions that the R-1 Company provided its comments vide letter dated 28.2.2008 on the said complaints and after receiving the comments and reply from the R-1 Company, the ROC found that that though these 984 shares were issued prior to the period 1965-66 and remaining unsubscribed for a very long period of time, the Board of Directors should not have exercised their power under section 81(1)(d). Since the board has a fiduciary duty in exceptional circumstances like issue of shares towards the members of a company, they should have offered these shares to all the existing shareholders in the ratio of shares held by them under section 81(1) of the Companies Act, 1956 . It can be concluded the Company has violated the provisions of section 81(1) and 81(1A) of the Companies Act, 1956. As the allotment was done against the provisions of the Companies Act, 1956, the complainant may be directed to approach the company law board under the provisions of Sec.397/398 of the Act for declaring the allotment as null and void. 984 shares which were meant for increase of the company s capital should have been allotted as prescribed by section 81 of the Companies Act, 1956 to such persons/entities who at the date of offer were holders of the equity shares of the company, in proportion to the capital paid-up of those shares on that date. The Explanatory Statement merely states the intention of the Company and its Board of Directors, but it does not provide even the slightest indication or explanation on the actual shape and size of the project, total built-up area, its financial features and the basis non which R-1 Company proposed to give 50% of built-up area to the builder/developer with proportionate share in undivided land on which the project would be built. While observing so, we are conscious of the fact that the only asset of the Company i.e. the land plot TS 168 Mangalore, is the subject matter of the joint development project and its failure in the absence of due diligence may result in a severe blow to the future of the Company. The Hon ble High Court of Karnataka did not give ad-interim order of injunction for considering agenda item no. 6 in the AGM, relating to Joint Development Agreement, in the Company s 61 AGM. It is noted that while the issue of selling or disposal of the Company s land was not considered as being contrary to the clauses of Memorandum of Association, the Hon ble High Court of Karnataka held that the Directors of the Company will invite tenders and finalise the dealing in a transparent manner. It is also noted that this order dated 6.6.2007 was not appealed against and has, therefore, assumes relevance insofar as the undertaking of the joint development project is concerned - Once 984 shares are allotted to the beneficiaries, this allotment is followed closely by the issue of joint development project raises which certainly question about the intention for allotment of 984 unsubscribed shares. This intention of the company and its Board of Directors is not explained to its members with any coherence, and raises question of transparency and reasonable expectation about growth in business of the Company. The issue of proxies was enquired into by the ROC, Karnataka and in the report dated 1.5.2008 in other matters as well as about proxies, he has inferred that since the proxies were duly signed by the members, they may not consider a wrongful act. Since there is no way at this stage of verifying the signatures of members signing the proxies. Thus, on the basis of available record, this issue is not held to be an act of oppression or mismanagement. This Tribunal is of the clear-cut view that the R-1 Company and its Board of Directors subjected its shareholders with acts of oppression and also indulged in mismanagement of the Company s affairs, while allotting the 984 shares and also in the proposal for the Joint Development Project, culminating in the signing of the Joint Development Agreement. These acts continued since the year 2007 and the Appellants have succeeded in making a clear cut case for their oppression by the Company and its Board of Directors as well as mismanagement of the Company s affairs. Appeal disposed off.
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2022 (12) TMI 59
Restraint on Respondent No.1 i.e. M/s Electrotherm (India) Ltd from holding a Board Meeting of its Directors - Section 421 of the Companies Act, 2013 - HELD THAT:- For deciding the appeal there is no reason to delve into the merit of the case. It is only interpretation of the order passed by this Appellate Tribunal and also by the Hon ble Supreme Court. In view of final disposal of the appeals by this Appellate Tribunal by its judgement dated 20.01.2022 in which there was no indication for restraining holding of the Boards Meeting, such point was not required to be raised before the NCLT for restraining board Meeting of the Company. Besides this even for the time being if it is considered that this Appellate Tribunal by its order dated 24.5.2021 had directed not to hold further meetings of Board of Directors, the said interim order was only to the next date of hearing i.e. 7.6.2021. Again by order dated 7.6.2021 the interim order was directed to continue till next date but on the next date i.e. on 17.6.2021 this Appellate Tribunal modified the earlier order and only stayed the order in respect of appointment of Siddarth Bhandari as joint signatory of bank account with Shailesh Bhandari. The order dated 17.6.2021 is a specific and unambiguous. The present appeal is nothing but simply an abuse of process of Court - appeal dismissed.
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2022 (12) TMI 52
Oppression and Mismanagement - oppression of minority shareholders - time was essence of the Assets Transfer Agreement (ATA) as specified Long Stop Date (LSD) or not - consent of the Appellants was necessary for any change in LSD - minority shareholder were oppressed by the majority shareholder - violation of rights of the Appellants in implementation of the SPSHA along with the Addendum to the SPSHA - implementation of the ATA was without consent of the minority shareholder - whether this tantamount to their oppression and detrimental to their rights? Whether, the time was essence of the Assets Transfer Agreement (ATA) as specified Long Stop Date (LSD) - Whether, the consent of the Appellants was necessary for any change in LSD? - HELD THAT:- It has been brought out that the LSD could not have been extended or extensions of the LSD was detrimental to right of the Appellants in any way. This establishes that although time is a significant concept in such transaction but cannot be a condition which cannot be altered with mutual consent of the concerned parties - This Appellate Tribunal also do not consider above action of extension of the LSD especially without consent of the Appellants as act of oppression of minority shareholders (the Appellants) by the majority shareholders. Looking into all these aspects and implication of extension of the LSD impacting favourably all stakeholders, the implementation of the ATA and revival of the company, this Appellate Tribunal do not find any error in the impugned order. Whether, the Appellants as minority shareholder were oppressed by the majority shareholder in the present case? - HELD THAT:- This Appellate Tribunal is not inclined to accept the arguments of the Appellants regarding their allegations of oppressions especially when the plant itself was shut down. There was no alternative except liquidation or revival of company through other modes including sale of assets to other entity who could revive the company. It is also not out of context to take into account that prima-facie payment of dues to stakeholders and bringing an additional investment of Rs. 66 crores by the 2nd Respondent as purchaser of the company as helped the company has well as all stakeholders including the Appellants. By no stretch of imagination these acts and deeds can be construed as oppression of the Appellants and therefore this Appellate Tribunal do not find any error in the impugned order on this account. Whether the rights of the Appellants have been violated in implementation of the SPSHA along with the Addendum to the SPSHA? - Whether the implementation of the ATA was without consent of the minority shareholder and whether this tantamount to their oppression and detrimental to their rights? - HELD THAT:- It seems that all decisions were required to be taken with approval of Investors and the Chairman was supposed to be Director nominated by the Investors (the Appellants) and it has been noted from the averments that the Appellants were appointed as Director and CEO on 02.02.2014 assuming charge and control of the company. However, due to deteriorating financial health of the company causing heavy losses and incurring debts, the Appellants resigned from the BoD and CEO position on 02.01.2015. It is also observed that the ATA was signed on 24.06.2016 by 1st Respondent, 2nd Respondent and each of the shareholder of the seller whose name was listed out in Schedule 1 of the ATA. This ATA was signed subsequent to resolution passed in EGM held on 16.04.2016 wherein Mr. Sanjeev Baba director of the company to authorise to negotiate, to settle the terms and conditions, signing and executing the requisite the Sale Agreement, Sale Deeds and such other documents as may be found necessary - This Appellate Tribunal therefore do not find that the provisions of the SPSHA or the addendum to the SPSHA were breached. Similarly, it is also held that no prior consent of the Appellants was needed for any amendments (in the present case extension of the LSD). Looking to all these agreements, events as discussed earlier and proper legal documents signed this Appellate Tribunal do not find any error in the impugned order. Similarly, not taking consent of the Appellants cannot be construed as act of oppression by majority shareholders especially keeping in view that the sale of the assets of the company was for the benefits of all stakeholders including shareholders and the company itself. This Tribunal, is of the considered opinion that there is no error, in the impugned order dated 11.02.2020, passed by the Tribunal and the Instant Appeal, is devoid of merits. Consequently, the Appeal fails. Appeal dismissed.
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Insolvency & Bankruptcy
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2022 (12) TMI 58
Maintainability of petition - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - non-application of mind while passing the order - principles of natural justice - HELD THAT:- The Adjudicating Authority, has apparently committed an error in not deciding the issue as to whether there was actually a default on the part of the Appellant. It should have given the reason as to why the contention of the Corporate Debtor that there was an understanding that money shall be paid after the sale of assets only has no substance in it and how it has come to the conclusion that various financial statements shows acknowledgement of the money/loan by the Corporate Debtor. There is no discussion at all by the Adjudicating Authority about these material facts. Not only that, it appears that the Adjudicating Authority has not looked into the fact that no one had appeared on behalf of the Corporate Debtor before it when the matter was argued and reserved and still it is recorded in its order that it had heard the arguments of the Corporate Debtor. All these facts cumulatively shows that there was no application of mind much less judicious in passing of the impugned order which has been apparently passed in a most mechanical manner. The Adjudicating Authority has to take into consideration the fact that the proceedings of CIRP, initiated after the admission of the application, has an immense adverse effect upon the Corporate Debtor, therefore, such application should not be admitted as a matter of routine and that too in a mechanical manner. The impugned order suffers from non-application of mind and is not a reasoned/speaking order, therefore, the same is hereby set aside and the matter is remanded back to the concerned Adjudicating Authority to decide the lis again by passing a speaking order.
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2022 (12) TMI 51
Initiation of CIRP - Operational Creditors - existence of pre-existing dispute or not - Application filed by the Appellant under Section 9 of the Insolvency and Bankruptcy Code, 2016 is dismissed - service of the Appellant was terminated by the Respondent on account of fraudulent activities which has caused damage to the Company - HELD THAT:- The Appellant was appointed by way of an employment agreement dated 19.06.2003 and his service was terminated by the letter of termination dated 16.08.2016. Since, it is the case of the Respondent that the service of the Appellant has been terminated in terms of employment agreement, therefore, it would be relevant to refer to the clause of termination of employment provided in the employment agreement. It is also not in dispute that there is a criminal case registered against the Appellant in which charge has been framed. The Appellant tendered apology also and the Respondent has disassociated itself from the Appellant by way of notice published in the newspaper. This is also not in dispute that the Appellant is claiming his salary and other perks which is attached with the salary like gratuity bonus etc. The order of termination is based upon alleged fraudulent activities on the part of the Appellant - The Appellant has not claimed one months pay as provided in clause 3.2 rather he has asked the Respondent to pay the amount of his salary and other perks attached with it which already become due before the order of termination was passed. Therefore, it is the case of the Appellant that there is no dispute about the said amount. Section 8 of the Code deals with the necessity of issuing demand notice by the Operational Creditor to the Operation debtor before embarking upon his remedy of filing of application under Section 9 of the Code. The Respondent has tried to take advantage of Section 8(2)(a) to contend that the application is not maintainable because of the existence of a dispute before filing of the application and because of that dispute the service of the Appellant was terminated and that the Respondent had to register FIR also against the Appellant which is pending trial. Careful reading of Section 8(2)(a) of the Code provides that the existence of dispute has to be in respect of the amount so claimed and it is not referable to any kind of dispute such as the one which is highlighted in the present controversy. One thing is clear that the plea of pre-existing dispute has to co-relate with the amount claimed by the Operational Creditor or if a suit or arbitration proceedings is pending then the same should also be related to such dispute. In the present case, however, no dispute ever has been raised by the Respondent that the Appellant is not entitled to the salary for the period from 01.08.2016 to 16.08.2016, flexible pay basket from 01.04.2016 to 16.08.2016, gratuity from 12.06.2003 to 16.08.2016 and performance bonus and business development bonus from 01.10.2016 to 16.08.2016. The only issue raised is about the services having been terminated on account of misconduct etc. on the part of the Appellant. It has been mentioned in the employment agreement that in case of termination on account of misconduct, the Appellant would not be entitled to one month notice pay and nothing beyond that. The Appellant has not claimed one month notice pay about which the Respondent could have raised a dispute on the basis of the terms and conditions contained in the employment agreement. Appeal allowed.
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PMLA
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2022 (12) TMI 57
Cheating - offence of money laundering or not - it is alleged that some of the foreigners invested thereby huge amounts in Indian Companies for the purpose of purchasing flats in Quepem - offence under Section 120B, 420 of IPC or not - HELD THAT:- The fact remains on record that FIR No.86/2017 registered at Quepem Police Station remains on record and no investigation has been carried in it till date. Report of the Sub-Divisional Police Officer clearly shows that it was a civil dispute in which attempt was made to convert it into a criminal offense. It is now well settled that powers of this Court under Section 482 of CrPC though extraordinary in nature, could be exercised so as to quash the FIRs which are practically considered to be civil disputes. There is already a report given by the Sub Divisional Officer of Quepem that it was a civil dispute. Even Final Report for grant of 'A' Summary was filed before the Quepem Court and then it was subsequently withdrawn. However, fact remains that complaint lodged by respondent no.2 discloses that it is a civil dispute and specifically in connection with the sale and purchase of flats in the project which the petitioner was constructing - it is deemed fit and proper to quash and set aside such FIR registered at Quepem Police Station under Section 482 of CrPC as continuance of such FIR is clearly an abuse of the process of law and no purpose would be served. Petition allowed.
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Service Tax
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2022 (12) TMI 56
Refund of accumulated/unutilized Cenvat Credit of Service tax - services exported out of India - rejection of refund on the ground of being ineligible input services in terms of Rule 2(l) of Cenvat Credit Rules, 2004 being no nexus with the output services - Rule 5 of Cenvat Credit Rules, 2004 r/w Notification No.27/2012 -CE (NT) dated 18.6.2012 - period in dispute is October, 2016 to March, 2017 - HELD THAT:- In the matter of M/S BNP PARIBAS INDIA SOLUTION PVT LTD VERSUS COMMISSIONER OF CGST, MUMBAI EAST [ 2021 (12) TMI 676 - CESTAT MUMBAI] this Tribunal while allowing the appeal of the assessee therein allowed the refund claim u/s. 5 ibid by holding that since the provisions of Rule 14 ibid have not been complied with, the refund of Cenvat credit as claimed by the Appellant under Rule 5 ibid cannot be denied. It is settled legal position that in absence of any notice for recovery as provided by Rule 14 ibid the refund claimed by the assessee under Rule 5 cannot be denied. Now I will take the merits of the matter and it has already been held by this Tribunal in the matter of ACCELEYA KALE SOLUTIONS LTD. VERSUS COMMISSIONER, CGST, THANE [ 2018 (7) TMI 1217 - CESTAT MUMBAI] that in such cases the nexus between the input service used in export of service should not be insisted upon - also, the amended provisions of Rule 5 of the rules have also been clarified by the Tax Research Unit of Department of Revenue vide Circular dated 16.3.2012. It has been stated therein that the nexus between the input service used in export of service should not be insisted upon and the benefit of refund should be granted on the basis of ratio of export turnover to total turnover demonstrated by the assessee. The authorities below have erred in rejecting the refund claim of the appellant. Accordingly the impugned order is set aside - Appeal allowed - decided in favor of appellant.
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2022 (12) TMI 55
CENVAT Credit - availment of depreciation under Income Tax Act, 1961 was assailed as breach in common - failure to discharge tax liability earned for rendering of taxable service for the period from 1st April 2009 to 30th September 2009 for which section 73 of Finance Act, 1994 has been taken recourse to - HELD THAT:- The adjudicating authority has failed to consider the altered paradigm consequent upon notification of Point of Taxation Rules, 2011 by which the regime of taxation of receipts was substituted by taxation of accruals. The impugned order has also failed to take into consideration the liability discharged by the appellant; settled law on such compliance must be given effect to. The contention of the appellant that depreciation claimed earlier has since been revised and appropriate changes made in returns under Income Tax Act, 1961 should have been considered in the light of judicial decision without exceeding the jurisdictional competence of the adjudicating authority for insisting upon acceptance of the same by authorities empowered under that statute. The adjudicating authority is required to consider the evidence furnished by the appellant that duty liability having been discharged on tippers sourced by them, as now placed on record, before concluding that the credit availed therein is ineligible. The impugned order is, thus, bereft of findings based on law, as enacted and judicially determined, applied to the facts put forth by the assessee and requires re-determination - matter remanded back to the original authority for fresh disposal of show cause notice after granting opportunity to assessee to make submissions on all issues. Appeal allowed by way of remand.
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2022 (12) TMI 50
Interpretation of the expression true liability in the first proviso to section 106 of the Finance Act, 1994 [the Finance Act] relating to Service Tax Voluntary Compliance Encouragement of the Finance Act Scheme 2013 - period April, 2012 to September, 2012 - HELD THAT:- It is under sub-section (1) of section 106 of the Finance Act that any person can declare his tax dues in respect of which no notice or an order of determination under section 73A has been issued or made before the first day of March, 2013. However, the first proviso provides that any person who has furnished return under section 70 and disclosed his true liability, but has not paid the disclosed amount of service tax or any part thereof shall not be eligible to make a declaration for the period covered by the said return. Thus, it is only in a case where a person has disclosed his true liability but has not paid the disclosed amount of service tax or any part thereof that a person would not be eligible to make a declaration for the period covered by the return. A person who claims that he has not disclosed his true liability in the return and has not paid the amount can, therefore, file a declaration under section 107(1) of the Finance Act. Some emphasis has to be placed to the word true occurring before liability in the first proviso to section 106 of the Finance Act - In the present case, as noticed above, the appellant claimed that it had not disclosed the true liability in the service tax return earlier filed for the period April, 2012 to September, 2012 and it is for this reason that the true liability was disclosed in the declaration filed by the appellant under section 107(1) of the Finance Act. The conclusion drawn by the Commissioner in the impugned order that since the amount of Rs. 64,67,773/- disclosed in the return was included in the amount of Rs. 66,98,098/- declared by the appellant, the appellant would not be justified in including this amount of Rs. 64,67,773/- in the declaration is apparently not in accordance with the provisions of section 106 of the Finance Act. If a true liability is disclosed subsequently by a person it is obvious that the amount earlier declared in the return would be included and it would not disentitle a person from including this amount in the declaration filed under section 106(1) of the Finance Act. There cannot be two amount towards tax dues. The appellant is clearly entitled to claim the entire amount of Rs. 01,051,31,384/- in the declaration filed under section 107(1) of the Finance Act and the view of the Commissioner to the contrary cannot be accepted - Appeal allowed.
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Central Excise
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2022 (12) TMI 54
Rejection of cash refund claim of unutilized credit - refund claim was rejected on the ground that as per Rule 57(13) it is not necessary to allow refund if manufacturer is able to use the credit for payment of duty - Rule 57F(1) of Central Excise Rules, 1944 - HELD THAT:- On perusal of facts, it is seen that the refund claim was originally returned to the appellant stating that they could use the accumulated balance credit for payment of duty on goods cleared for home consumption. The appellant approached the department to process the refund claim and pass a speaking order. Interestingly, thereupon Order in Original No. 108/199 was passed rejecting the refund holding that there is no balance to sanction refund. As per the appeal preferred by the appellant, the matter was remanded to the original authority with a direction to issue Show Cause Notice and re-examine the claim. I fail to understand why repeated Show Cause Notices have been issued even though it is a remand by the first appellate authority. The department then opted to adjudicate the second Show Cause Notice and rejected the claim stating that there is delay on the part of the appellant to press for processing of the claim. How can the appellant be said to be at fault when the matter has been remanded by Commissioner (Appeals) directing to re-examine the matter after issuing Show Cause Notice. After hearing the matter on 8.9.2022, it was posted for clarification on the side of the department as to whether there is a dispute with regard to the balance available in their register as on the date of filing the refund claim. The department has not put forward any reply or clarification. From the arguments put forward by the learned counsel for appellant and also the photocopies of the relevant part of the registers furnished by the learned counsel for the appellant, I find that the contention of the appellant that there was wrong debit entry and contra credit entry made in the registers is not without substance. From the letters written by the appellant to the department, it is seen that they have produced these documents before the authorities below also. The rejection of refund claim is on erroneous facts and misconception of Rule 57F of Central Excise Rules, 1944 - Appeal allowed - decided in favor of appellant.
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2022 (12) TMI 49
Rejection of rebate claim - Period of limitation when no reference is given in the relevant Rule or Notification - applicability of time/limitation prescribed u/s 11B - HELD THAT:- It is required to be noted that Rule 18 of the 2002 Rules has been enacted in exercise of rule making powers under Section 37(xvi) of the Act. Section 37(xxiii) of the Act also provides that the Central Government may make the rules specifying the form and manner in which application for refund shall be made under section 11B of the Act. In exercise of the aforesaid powers, Rule 18 has been made and notification dated 6.9.2004 has been issued. At this stage, it is required to be noted that as per Section 11B of the Act, an application has to be made in such form and manner as may be prescribed. Therefore, the application for rebate of duty has to be made in such form and manner as prescribed in notification dated 6.9.2004. However, that does not mean that period of limitation prescribed under Section 11B of the Act shall not be applicable at all as contended on behalf of the appellant. Merely because there is no reference of Section 11B of the Act either in Rule 18 or in the notification dated 6.9.2004 on the applicability of Section 11B of the Act, it cannot be said that the parent statute Section 11B of the Act shall not be applicable at all, which otherwise as observed hereinabove shall be applicable with respect to rebate of duty claim. The issue involved in the present appeal is squarely covered by the decision of this Court in the cases of Mafatlal Industries Ltd. [ 1996 (12) TMI 50 - SUPREME COURT ] and Uttam Steel Limited [ 2015 (5) TMI 214 - SUPREME COURT ]. After taking into consideration Section 11B of the Act and the notification and procedure under Rule 12, it is specifically observed and held that rebate of duty of excise on excisable goods exported out of India would be covered under Section 11B of the Act. After referring to the decision of this Court in the case of Mafatlal Industries Ltd., it is further observed in the case of Uttam Steel Limited that such claims for rebate can only be made under Section 11B within the period of limitation stated therefor. It is observed and held that while making claim for rebate of duty under Rule 18 of the Central Excise Rules, 2002, the period of limitation prescribed under Section 11B of the Central Excise Act, 1944 shall have to be applied and applicable. In the present case, as the respective claims were beyond the period of limitation of one year from the relevant date, the same are rightly rejected by the appropriate authority and the same are rightly confirmed by the High Court. We see no reason to interfere with the impugned judgment and order passed by the High Court. Under the circumstances, the present appeal fails and deserves to be dismissed. Appeal dismissed.
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2022 (12) TMI 48
Valuation of manufactured material liquid Carobon dioxide (CO 2 ) - inclusion of freight charges for delivery at buyer s place in the transaction value - freight charges recovered by the appellant manufacturer from the purchasers of manufactured product / liquid CO 2 for transporting the said product in its own specialized tankers to the buyers premises - Scope of place of removal - HELD THAT:- From the definition of place of removal also it is seen that where the price at which goods are ordinarily sold by the assessee is different for different places of removal, then each such price shall be deemed to be the normal value thereof. Subclause (b)(iii) is very important and makes it clear that a depot, the premises of a consignment agent, or any other place or premises from where the excisable goods are to be sold after their clearance from the factory are all places of removal. What is important to note is that each of these premises is referable only to the manufacturer and not to the buyer of excisable goods. Hon ble Apex Court in the case of UNION OF INDIA ORS. ETC., ETC. VERSUS BOMBAY TYRE INTERNATIONAL LTD. ETC., ETC. [ 1983 (10) TMI 51 - SUPREME COURT ] held that cost of transportation from place of removal to the place of delivery is statutorily excluded. The harmonious reading of three of above provisions (Section 4 of Central Excise Act, Rule 5 of Valuation Rules and definition of place of removal under section 4 of Central Excise Act, 1944) makes it clear that buyer s premises can never be, by any law, can be called as the place of removal of excisable goods. The place of removal can never be equated with the place of delivery. Place of removal alone is relevant for the purpose of section 4 i.e. for the purpose of calculating the transaction value as it was held by Hon ble Apex Court in the case of ESCORTS JCB LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, DELHI-II [ 2002 (10) TMI 96 - SUPREME COURT ]. Undisputed fact remains is that appellants are mentioning the freight charges as separately in the invoices issued by them to the purchasers, there is nothing in the invoices or any other documents which shows that sales are on FOR destination basis, though the authorities below have given the finding that sales were on FOR destination basis but no evidence in this regard has been discussed - the cost of transportation in the given circumstances is the one which has expressly been excluded in terms of Rule 5 of Valuation Rules. The freight charges are not includible in the assessable value of liquid CO 2 those being separately charged in the invoices and the gas was sold at the time of clearance from the factory of the appellant. The authorities below are held to have wrongly confirmed the duty demand against the appellant on the basis of inclusion of freight charges in assessable value. Appeal allowed.
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2022 (12) TMI 47
Levy of Central Excise duty - carbon dioxide generated during the process of fermentation of beer and used for its carbonation - captive consumption of carbon dioxide - interpretation of the notification dated 16.03.1995 - case of the Department is that since no excise duty is payable on the final products, the exemption notification would not be applicable to the appellant - HELD THAT:- It is seen from the perusal of the judgment of the Kerala High Court in SABMILLER INDIA LTD. VERSUS UNION OF INDIA [ 2019 (11) TMI 558 - KERALA HIGH COURT] that the period involved was from July 2009 to January 2014 and the dispute was with regard to carbon dioxide produced in the factory and captively consumed in the course of manufacture of beer. The Kerala High Court observed that carbon dioxide may be an independent product mentioned in the central excise tariff but it was a product that arose in the manufacturing process and would only be seen as an efficient process for manufacture of beer. The High Court, therefore, held that in such a situation central excise duty would not be payable. The order passed by the Commissioner (Appeals) cannot be sustained and is set aside - Appeal allowed.
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CST, VAT & Sales Tax
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2022 (12) TMI 53
Principles of natural justice - order passed without confronting the appellant with the adverse material collected behind its back and without affording opportunity to rebut the same - rejection of C form declaration in question merely on account of their non verification at a non-statutory website like TINXYXS in absence of any suitable statutory provision to that effect under the Act - collusion between the appellant and the purchasing dealer issuing the declaration in question - levy of penalty under section 21(2) of the M.P VAT Act, 2002 - collusion between the appellant and the purchasing dealers issuing the declaration in question - HELD THAT:- The appellant cannot escape from its liability to pay tax merely by submitting that he received the certificate and produced before the department and he has no concerned about its genuineness. Since 2015, the appellant has not taken any action against the dealer, who gave the certificate to the appellant. Similar issue came up for consideration before this Court in case M/S. ADANI EXPORTS LIMITED, INDORE VERSUS COMMISSIONER OF COMMERCIAL TAX, INDORE ANOTHER [ 2018 (9) TMI 1112 - MADRAS HIGH COURT] and after considering the aforesaid judgment cited by Shri Choudhary, Division Bench of this Court has held that Form- C submitted by the purchaser have been found forged, which clearly shows that the purchasers are not registered dealer, therefore, the assessee is liable to pay tax and penalty as imposed by the Competent Authority and affirmed by the Appellate Board. It has also been held that The breach of civil obligation will immediately attract penalty irrespective of whether the contravention is with a guilty intention. The High Court of Chhatisgarh in case of M/S AVINASH TRADERS VERSUS STATE OF CHHATTISGARH THROUGH ITS SECRETARY, COMMISSIONER, COMMERCIAL TAX DEPARTMENT, ADDITIONAL COMMISSIONER, COMMERCIAL TAX AND DIVISIONAL DEPUTY COMMISSIONER, COMMERCIAL TAX [ 2018 (12) TMI 1010 - CHATTISGARH HIGH COURT] has also taken the similar view that if a fake or a fraudulent Form-C is produced by an Assessee and if it is found to be so, it will be as good as non production of Form-C and no advantage thereof can be taken therefrom by trying to shift the onus on anybody else. Appeal dismissed.
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2022 (12) TMI 46
Deduction VAT / TDS from the bills by the Recipient of work contract service - Sub-contractor of Main contractor - Non issue to TDS certificate since the amount was adjusted as per the terms of contract - Direction upon the respondent company to issue Certificate of Tax Recovery at Source in Form-JVAT 400 in favour of the petitioner - HELD THAT:- The entire portion of contract was sub-contracted by HSCL in favour of the petitioner and in turn it raised bill to Bokaro Steel Plant. The Supplies and activities covered by both bills were the same and there was only one accretion resulting in one deemed sale. The said deemed sale, Bokaro Steel Plant while paying HSCL s bills deducted TDS on account of VAT payable at the applicable rate and TDS deducted was deposited with the State Government authorities by Bokaro Steel Plant. The Relevant clause 8 of the Special Conditions of Contract wherein it is mentioned that the applicable VAT etc. payable by HSCL shall be reimbursed by the agency s bill. This was merely a mode and manner of fixing price between HSCL and the sub-contractor-petitioner. The TDS was deducted by Bokaro Steel Plant and paid by Bokaro Steel Plant. Thus, it is crystal clear that the entire portion of contract was sub-contracted by the Respondent Company to the petitioner on back-to-back basis and the sub-contractor raised bills to HSCL and HSCL in turn raised bills to Bokaro Steel Plant and Bokaro Steel Plant while paying HSCL s bills deducted TDS on account of VAT payable at the applicable rate and TDS deducted was deposited with the State Government authorities by Bokaro Steel Plant. Nothing has been produced by the petitioner which would reveal deduction on account of VAT for the works contract of M/s Hindustan Steel Works Construction Limited, for which the respondent-M/s Hindustan Steel Works Construction Limited is under a duty to issue certificate in Form-JVAT 400. Application dismissed.
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2022 (12) TMI 45
Input tax credit - cancellation of license of three dealers - Registration / license of supplier dealers have been cancelled - HELD THAT:- There was a dispute about the cancellation of the license of only 3 dealers, but all the transactions made by the petitioner with 17 dealers have been cancelled. No inquiry has been conducted as to whether those dealers had paid tax or not for which the petitioner claimed the input tax rebate. It is also important to note that so far as the purchase made from M/s. Abhishek Sales Industries is concerned, his license was cancelled on 27.8.2008 whereas the petitioner purchased the item on 18.5.2008 and 17.5.2008 i.e. much before purchases. So far as purchases from M/s. Bhawani Trading Co. is concerned, his licence was cancelled on 29.2.2008 and the petitioner purchased the coriander on 30.6.2008. No inquiry has been conducted as to whether the petitioner had any knowledge about the cancellation of their license at the time of purchase. All the sales were made within the Mandi premises. The license of M/s. Abhishek Sales Industries and M/s. Santosh Brothers were cancelled after the purchase was made by the petitioner. Due to the cancellation of the license of these 3 dealers, the respondents disbelieved all the 17 transactions and disallowed the benefit of input tax rebate to the petitioner. Therefore, the manner in which the impugned order dated 23.6.2011 has been passed, no stamp of approval can be given in these wit petitions. The orders dated 23.6.2011 and 29.11.2012 are liable to be quashed and the matter is liable to be remanded back to the Assessing Authority to pass a fresh order after conducting a detailed inquiry - Petition allowed by way of remand.
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Indian Laws
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2022 (12) TMI 61
Seeking release/recovery of HRA - no opportunity of hearing was given before starting recovery proceedings - entrustment of respondents' additional work of ISEZ - requirement to conduct an enquiry for making such recovery - HELD THAT:- Undisputedly, before making such recovery, no enquiry was conducted and no show-cause notice was given to the respondents. It is also not the case of petitioners / Department that respondents made any misrepresentation or fraud for getting HRA @ 20%. So far as the entitlement of HRA @ 20% is concerned, the respondents have filed various appointment orders (Annexure-A/2) to show that they were given the additional charge of ISEZ, Indore and some of them were regularly posted for three years and the same has not been disputed by the petitioners. The respondents obtained an information through RTI that Audit Memo No.12 on the subject of Review of HRA which is reproduced in paragraph 7 of the impugned order, according to which Custom Officers posted at Pithampur who are also looking into the work of SEZ located at Indore and also some portion of ISEZ located at Indore that has made them entitled to get HRA at higher HRA despite their regular posting at Pithampur. If the petitioners are disputing the entrustment of respondents' additional work of ISEZ then an enquiry ought to have been conducted to verify the facts that at the relevant point of time they were posted or not. It was an account section of the petitioners who paid HRA @ 20% to the respondents, therefore, the Central Administrative Tribunal has rightly set aside the recovery. Lastly, Shri Sudhanshu Vyas, has argued that respondents gave an undertaking at the time of grant of HRA. It is correct that the undertaking binds them, not to object the recovery if excess amount found to be paid without entitlement. Once the Tribunal has held that the respondents were entitled to get HRA @ 20% and the amount cannot be recovered then undertaking has no effect - there are no reason to entertain this writ petition. Petition dismissed.
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2022 (12) TMI 44
Suppression of facts from the Court - Seeking permission to withdraw the petition - it is alleged that the petition suffers from serious suppression of facts - scope of any person as per Section 17(1) of the Securitization Act - HELD THAT:- This is trite that a litigant must approach the Court with clean hands, clean heart, clean mind and clean objective. This is settled that if a litigant has approached the court with a pair of dirty hands, the petition may be dismissed on this count alone. In other words, the petitioner does not have any right whatsoever to get a hearing on merits from this Court because of such conduct of suppression of material fact. Apart from this, contempt proceedings can also be initiated for suppression of facts. A plain reading of requirement of declaration as per High Court Rules leaves no room for any doubt that petitioner was required to disclose about previously instituted proceedings relating to same subject matter instituted before any Court, Authority and Tribunal. This disclosure is essential in para-2 of the petition and in addition, it can be disclosed in remaining portion of the body of petition - since learned counsel in the previous rounds of litigation and in this litigation is same, it was all the more necessary and obligatory on the part of the petitioner to disclose the entire facts and history of previous rounds of litigation with accuracy and precision. In view of this conduct of petitioner, a sizable amount of precious time of court is being wasted. We deem it proper to observe that suppression of facts cannot be termed as advocacy . If a litigant discloses all the facts correctly and then able to convince the court, it can be treated as skill of advocacy. The litigation is neither a game of chess nor a hide and seek game but a search for truth and parties must place their cards on the table - it is deemed proper to dismiss this petition with exemplary cost. Petition dismissed with cost of Rs.50,000/- (Rupees Fifty Thousand Only).
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