TMI Tax Updates - e-Newsletter
March 27, 2018

Case Laws in this Newsletter:

GST Income Tax Customs Corporate Laws Insolvency & Bankruptcy FEMA Service Tax Central Excise CST, VAT & Sales Tax Indian Laws

Articles

1. VICARIOUS LIABILITY OF MANAGING DIRECTORS AND OFFICERS OF THE COMPANY

   By: DR.MARIAPPAN GOVINDARAJAN

2. Tweets in GST

   By: Altamush Zafar

News

1. Attention Exporters – Refund Fortnight From 15th -29th March, 2018

2. Joint Group Most Important Dialogue Mechanism between India and China – Suresh Prabhu

3. CBDT issues clarification regarding requirement for furnishing of Country-by Country report under section 286(4) of IT Act, 1961

Highlights / Catch Notes

GST

• Supreme Court orders Monitoring Committee to enable lessee's input tax credit claims on e-auctioned minerals under CGST Act 2017.

  Case-Laws - SC : Input tax credit - GST payable on sale value of mineral purchased through e-auction - SC directed the Monitoring Committee to take necessary action to enable the lessee to claim and obtain input tax credit under the CGST Act, 2017
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Income Tax

• TDS u/s 195 Applies to Use of Patents for Manufacturing in India; Includes Sales in USA. Withholding Tax Confirmed.

  Case-Laws - AT : TDS u/s 195 - the patent/IPRs are utilized for manufacturing activities in India and the rest of the activity, i.e., sale in USA has to be viewed in conjunction with this activity and the same cannot be isolated - withholding tax liability confirmed - AT
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• Can Assessing Officer Decide on International Transactions Below Rs. 5 Crore Without Transfer Pricing Officer Referral?

  Case-Laws - AT : TPA - whether AO should have decided the issue of international transaction himself instead of referring it to Transfer Pricing Officer as the quantum of International Transaction is below the monetary limit of ₹ 5 crore? - If powers conferred on a particular authority are arrogated by other authority without mandate of law, it will create chaos in the administration of law and hierarchy of administration will mean nothing. Satisfaction of one authority cannot be substituted by the satisfaction of the other authority. - AT
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• Court Rules on Unexplained Cash Credit: Mere Document Rejection Insufficient u/s 68 & 153A of Income Tax Act.

  Case-Laws - AT : Unexplained cash credit u/s 68 - identity, genuineness and creditworthiness of subscribers - assessment u/s 153A - Merely rejecting the documents does not amount that assessee has not prove the identity, genuineness and creditworthiness of subscribers - AT
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• Section 69 Income Tax Act: Excess Gold Weight as Undisclosed Investment Challenged Due to Lack of Evidentiary Value in Survey Statement.

  Case-Laws - AT : Addition u/s 69 - excess weight of gold ornaments as undisclosed investment - there is much force in the argument of the counsel for the appellant that the statement, elicited during the survey operation has no evidentiary value. - AT
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• ITAT erred in removing penalty for cash deposits from staff, violating Section 271D of the Income Tax Act.

  Case-Laws - HC : Penalty u/s 271D - The assessee failed to discharge its burden in proving that there was a reasonable cause in accepting the deposits from staff members other than by way of cheque or draft - ITAT erred egregiously in deleting the penalty - HC
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• CIT Rightly Invokes Section 263 to Tax Medical, Conveyance, and Sumptuary Allowances; No Exemption Found in Act or Rules.

  Case-Laws - AT : Revision u/s 263 - since there is no provision under the Income-tax Act or the Rules, whereby Medical, Conveyance and Sumptuary allowances are exempt from taxation, we hold that CIT is justified in invoking his revisionary jurisdiction u/s 263 of the I.T.Act - AT
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• Taxpayer's Alternative Claim Leads to Slump Sale Evaluation u/s 50B in Reassessment Proceedings.

  Case-Laws - AT : In the original return of income, since the assessee has not made the claim, the assessee could not have filed the Form No. 3CEA along with the return of income. Its only during the reassessment proceedings, that the assessee had made an alternate claim and therefore, the CIT(A) has rightly directed the A.O to assess the transaction arising out of the BPA as a slump sale u/s 50B of the IT Act. - AT
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Corporate Law

• Repeated Failure to File Annual Returns Deemed Non-Compoundable u/ss 451 and 441(6) of Companies Act 2013.

  Case-Laws - Tri : Compounding of offences - default in relation to filing of Annual Returns - the default is in relation to more than a year and as the same offence had been committed for the second or subsequent occasions within a period of three years - it is non-compoundable by virtue of operation of section 451 read with section 441(6) of the Companies Act, 2013 - Tri
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• SEBI Takes Control of Funds in Collective Investment Scheme Pending Final Order; Ensures Petitioner's Right to Respond.

  Case-Laws - HC : Attachment orders - collective investment scheme - SEBI found fault in the scheme - the only caveat being is that since moneys have already been transmitted to the Board, it will retain the same in trust till such time the Recovery Officer passes a final order after issuance of notice, giving due opportunity to the petitioner to respond to the same. - HC
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Indian Laws

• CBDT Clarifies CbC Report Submission Requirements u/s 286(4) of Income Tax Act for Multinational Enterprises.

  News : CBDT issues clarification regarding requirement for furnishing of Country-by Country report under section 286(4) of IT Act, 1961
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IBC

• Tribunal Cannot Reject Insolvency Petition Due to Insufficient Stamping; Petitioner Liable for Adverse Stamp Duty Orders.

  Case-Laws - Tri : Initiate insolvency resolution process against the respondent-corporate debtor - the document of assignment cannot be rejected by this Tribunal while disposing of the instant petition on the ground of being insufficiently stamped though the petitioner would be bound by the consequences if any adverse order on changing of stamp duty comes into play. - Tri
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• NCLT Can Start Insolvency Process u/ss 7, 9, 10 Despite Pending Winding-Up Petition, Unless Liquidator Appointed.

  Case-Laws - Tri : No bar on NCLT to trigger an Insolvency Resolution Process on an application filed under sections 7,9 & 10 if a winding up petition is pending unless an official liquidator has been appointed and a winding up order is passed. - Tri
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Service Tax

• Service Tax Applies Only to Contracts After July 1, 2003; Earlier Contracts Exempt Regardless of Payment Date.

  Case-Laws - HC : Levy of service tax on receipt of amount after new levy whereas the contract was Concluded before levy - Any payment of contract which are entered after 1-7-2003 will invite Service Tax and any contract which is concluded prior to 1-7-2003 will not invite imposition of Service Tax. - HC
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• Service Tax Exclusion: Reimbursement of Expenses Not Part of Service Tax, Show Cause Notice Dismissed. Audit Findings Overturned.

  Case-Laws - AT : Valuation - pure agent - inclusion of reimbursement of expenses - It was only stated that it was found by Audit Officers that the conditions of Pure Agent were not satisfied by the appellant - the allegations are bald and the SCN is not sustainable - AT
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• Notional Interest Excluded from Taxable Value in Renting Immovable Property Services; No Service Tax Applicable.

  Case-Laws - AT : Valuation - renting of immovable property service - notional interest cannot be included in the value and will not be taxable under the category of renting of immovable property services - no service tax is chargeable on notional interest. - AT
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• Service tax demand on business support services deemed unjustified; suppression clause u/s 73 not applicable.

  Case-Laws - AT : Business Support Services - bonafide belief - the demand has been raised for the period immediately after the category of business support service was introduced into the statute books. Consequently, the Revenue is not justified in raising the demand by invoking the suppression clause u/s 73 - AT
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• Appellant Exempt from Service Tax for GTA Services; Client Pays Freight Charges Directly to Transporters, No Reverse Charge Liability.

  Case-Laws - AT : GTA service - reverse charge mechanism - It is on record that appellant herein does not discharge the freight charges but claims the amount from their client who pays it to the transporters from whom they engaged the vehicles - the appellant has no liability to pay the service tax - AT
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• Luggage Booking for Bus Owners Classified as "Business Auxiliary Service" for Service Tax Purposes, Deemed Taxable Service.

  Case-Laws - AT : BAS - booking of luggage on behalf of the bus owners - Since the bus owners are clients of the appellant, on whose behalf booking of luggage was made, the same should fall under the taxable category of “Business Auxiliary Service. - AT
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Central Excise

• Goods Classification: Computer Upgrade Units as Sub-Assemblies, Not Complete Machines Under Chapter 8471.00 for Tax Purposes.

  Case-Laws - AT : Classification of goods - Terminal and Computer upgrades/up-gradation - upgrade units though helps in enhancing the capacity of the computer but unit itself is not complete machine therefore it cannot fall under Chapter 8471.00 since upgrades units being sub assembly - AT
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• Brass Sheets for Utensils and Handicrafts Exempt from Duty; Notification No. 67/95 Not Applicable.

  Case-Laws - AT : Untrimmed sheets of brass were being used in the manufacture of utensils and handicrafts and, therefore, they were attracting Nil rate of duty and, therefore, the question of applicability of said N/N. 67/95 did not arise - AT
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Case Laws:

• GST

• 2018 (3) TMI 1318
  Revival of Rule 138 of the Uttar Pradesh Goods and Services Tax Rules, 2017 - whether Rule 138 of the UPGST Rules, 2017 as it stood originally before the 4th amendment would stand revived with the rescinding of the notifications dated 30/31.01.2018 enforcing the amended Rule 138 of the Rules w.e.f. 01.02.2018 with regard to the E-Way Bill? - Held that: - respondents may file counter affidavit within a month - any order which is passed pursuant to the SCN will be subject to decision of this writ petition and at the same time the petitioner would also at liberty to challenge it in the appropriate forum.

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• Income Tax

• 2018 (3) TMI 1317
  Penalty u/s 271D - acceptance of loans and deposits other than by way of Cheque or Draft, in violation of Section 269SS - reasonable clause - Held that:- Tribunal erred egregiously in deleting the penalty levied under Section 271D, on the facts disclosed and cause shown, which approach and conclusions are perverse. The assessee failed to discharge its burden in proving that there was a reasonable cause in accepting the deposits from staff members other than by way of cheque or draft. The Tribunal failed to appreciate the import of Section 271D in the correct perspective. We answer the questions of law arising from the order of the majority, against the assessee and in favour of the Revenue.

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• 2018 (3) TMI 1316
  Sanction for prosecution issued u/s 279(1) - TDS not deposited in the government treasury within the prescribed statutory time - defaults were in respect of salary as well as non-salary TDS deductions - Refund paid towards TDS arrears - Held that:- Merely recorded what has been stated by the counsel for the revenue and not given our pronouncement or judgment in view of the contentions raised in the writ petition or on merits of the criminal complaint which is pending trial. These issues will have to be examined in accordance with law in the criminal proceedings. In case the petitioners are able to make out that cognizance was not justified and as per law they can challenge and question the summoning order by way of petition u/s 397 r.w.s. 401 of the Code of Criminal Procedure, 1973 (Code) or if permissible, by way of a petition under Section 482 of the Code. Non-payment of refunds. There is difficulty in examining this allegation. Petitioners have not impleaded the jurisdictional AO and Commissioner as respondents/parties to the writ petition. The Sanctioning Authority is the first respondent and Directorate of Income Tax, Ministry of Finance is the second respondent. The second respondent is not an authority and does not have any legal existence. As per details ascertained by the counsel for the Revenue refunds for the AY 2005-06 stands paid. There is, however, short of credit on TDS amounting to 8,85,418/- which is under verification on account of old records and non-availability of TDS challans. Petitioners claim that they are entitled to refund of 49 Lakhs for the AY 2005-06. This fact is disputed. With regard to the AY 2009-10, refund of 37,75,750/- was issued on 1st February, 2014. For the balance amount of 14,56,140/-, the matter is under verification and thereafter refund would be issued. Petitioner accepts that refund of 3.05 Crores for the Assessment Year 2010-11 was issued on 27th November, 2012. As per the chart produced by the petitioners, during the period 30th June, 2012 till 31st March, 2013, 85.11 Lakhs was deposited towards TDS, leaving an outstanding balance of more than 2.68 Crores payable as TDS. Entire refund was not paid towards TDS arrears. We clarify that we have not expressed any opinion relating to refund on merits and have only noticed the facts and contentions raised by the respective sides. This order would not prejudice the rights of the petitioners, or as deciding contentions and defenses that the petitioners may raise during the course of criminal prosecution or if they challenge the order passed by the ACMM taking cognizance and issuing summons. Petitioners states that they would be moving an application seeking exemption from personal appearance. If any such application is filed, the same would be considered as per law.

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• 2018 (3) TMI 1315
  Penalty u/s. 271(1)(c) - non specification of charge - Held that:- We find that the notice dt. 24-12-2012 issued u/s. 274 r.w.s 271 of the Act does not specify the charge of offence committed by the assessee viz whether had concealed the particulars of income or had furnished inaccurate particulars of income. Hence the said notice is to be held as defective. - Decided in favour of assessee

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• 2018 (3) TMI 1314
  Addition u/s 69 - excess weight of gold ornaments as undisclosed investment - evidentiary value of statement elicited during the survey operation - Held that:- Section 133A enables the IT authority only to record any statement of any person which may be useful, but does not authorize for taking any sworn in statement. The IT Act, whenever it thought fit and necessary to confer such power to examine a person on oath, the same has been expressly provided whereas section 133A does not empower any ITO to examine any person on oath. Thus, in contra distinction, to the power under section 133A, section 132(4) enables the authorized officer to examine a person on oath and any statement made by such person during such examination can also be used in evidence under the IT Act. Whatever statement recorded under section 133A is not given any evidentiary value obviously for the reason that the officer is not authorized to administer oath and to take any sworn statement which alone has the evidentiary value as contemplated under law. Therefore, there is much force in the argument of the counsel for the appellant that the statement, elicited during the survey operation has no evidentiary value. We are of the view that there is no infirmity in the order passed by the ld. CIT(A). That being so, we decline to interfere in the order passed by the ld. CIT(A), his order on this issue is hereby upheld and the grounds of appeal raised by the Revenue is dismissed.

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• 2018 (3) TMI 1313
  Addition on account of legal expenses - as per AO expenses were not incurred for the purpose of business and moreover, TDS deducted there-from was not deposited within the stipulated time limit - Held that:- As assessee pleaded for admission of additional evidences in support of the claim on this account. Keeping in view the principle of natural justice, the issue stands remitted back to the file of Ld. AO with a direction to assessee to substantiate his claim and demonstrate that these expenses were incurred for the purpose of assessee’s business and further the provisions of TDS has duly been complied with against the same. Ground Nos. 1 5,55,990/- incurred by the assessee in the capacity of proprietor for AY 2007-08 has completely been set-off in AY 2008-09 and the same is, undisputedly, in order. Loos set-off to the partner in individual capacity - Held that:- The assessee was admitted as partner of the firm since 22/10/1968 and continued as partner up-to 22/09/2006 when the other partner of the firm (assessee’s brother) died and the firm was continued as proprietorship concern of the assessee. Therefore, we do not find any strength in the argument that it is a case of succession by inheritance since nothing has been inherited by the assessee rather he was already a partner in the firm since inception stage of the firm. Hence, on factual matrix, we find that the assessee’s share in the losses of the erstwhile firm belonged to that firm only and could not be set-off by assessee in individual capacity.

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• 2018 (3) TMI 1312
  Treatment to the warehouse rent - income from business OR house property income - Held that:- Respectfully following the decision of the Hon’ble Supreme Court in the case of Chennai Properties [2015 (5) TMI 46 - SUPREME COURT], we hold that the ld CIT-A had rightly directed the ld AO to treat the warehouse rentals as income from business and consequentially allow the expenditure claimed in the return as business expenditure. Accordingly, the Ground No.1 raised by the revenue is dismissed. Disallowance of commission paid to related parties by invoking provisions of section 40A(2) - Held that:- The assessee had made payment of commission at 4% on sales made to both related as well as unrelated parties. Hence the percentage of commission at 4% is determined to be at Arm’s Length. Hence the same cannot be construed as excessive or unreasonable within the meaning of section 40A(2) of the Act. There is no evidence to prove that the impugned transaction of payment of commission was prompted by consideration of tax avoidance. On the contrary, the evidences suggest that the payee had suffered taxes on the said commission income at maximum marginal rate and had also derived commission income of 16.12 crores which admittedly includes commission payments made by the assessee herein. CIT-A had rightly appreciated these facts and contentions of the assessee and had rightly deleted the disallowance and we find no infirmity in the said order of the ld CITA in this regard. Accordingly, the Ground No. 2 raised by the revenue is dismissed Grant depreciation at 15% on Electrical Installations - Held that:- CIT-A had given a categorical finding that the electrical installations were integral part of plant and machinery installed at the factory and that the electrical installations inter alia included items such as transformers, electrical panels, HT wirings etc which were necessary for operating plant and machineries installed at the factory. He further held that without the aid and use of supporting electrical installations, the assesee’s factory could not have become operational. These findings are not controverted by the revenue before us. Hence we do not find any infirmity in the order of the ld CITA in this regard. Accordingly, the Ground No. 3 raised by the revenue is dismissed.

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• 2018 (3) TMI 1311
  Unexplained cash credit u/s 68 - identity, genuineness and creditworthiness of subscribers - assessment u/s 153A - Held that:- The documents gave the complete details of the subscribers and it is pertinent to note that the AO has not at all made any effort to make enquiries and verify the authenticity of the same. Merely rejecting the documents does not amount that assessee has not prove the identity, genuineness and creditworthiness of subscribers. In fact, the assessee has given all the details as per the requirement of the identity, genuineness and creditworthiness of subscribers. The CIT(A) has given a detailed findings and there is no need to interfere with the same. As no incriminating material found and besides that there additional evidence has prove the case of the assessee which was not verified by the Assessing Officer in Remand Report and therefore, the CIT(A) has rightly taken cognizance of these evidences and passed a just and proper order - As on the date of search, assessment or reassessment for both the years was not pending on the date of search, as such, nothing was abated on the date of search, and hence in the absence of any incriminating material found from the premises of the assessee, additions made in both the years were outside the scope of Section 153A - Decided against revenue

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• 2018 (3) TMI 1310
  TPA - whether AO should have decided the issue of international transaction himself instead of referring it to Transfer Pricing Officer as the quantum of International Transaction is below the monetary limit of 5 crore? - Held that:- The Special Bench of this Tribunal in case of Aztec Software & Technology Services Ltd. vs. ACIT [2007 (7) TMI 50 - ITAT BANGALORE] held that CBDT directions are mandatory and binding on the Assessing Officer and CIT. Jurisdictional High Court in case of CIT vs. SPL’s Siddhartha Ltd. (2011 (9) TMI 640 - DELHI HIGH COURT) held that “Section 116 of the Act also defines the income-tax authorities as different and distinct authorities. Such different and distinct authorities have to exercise their powers in accordance with law as per the powers given to them in specified circumstances. If powers conferred on a particular authority are arrogated by other authority without mandate of law, it will create chaos in the administration of law and hierarchy of administration will mean nothing. Satisfaction of one authority cannot be substituted by the satisfaction of the other authority. It is trite that when a statue requires, a thing to be done in a certain manner, it shall be done in that manner alone and the court would not expect its being done in some other manner.” Additional Ground of the assessee is allowed. At this juncture, the assessment has become time barred as the reference made to TPO itself is not sustainable and the Assessing Officer should have passed Assessment Order at the prescribed time provided under the statute. We are not deciding on the merit of the case as the additional ground is decided in favour of the assessee.

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• 2018 (3) TMI 1309
  Disallowance u/s 14A - Held that:- As relying on supreme court in the case of WALFORT SHARE & STOCK BROKERS (P) LTD. (2010 (7) TMI 15 - SUPREME COURT) net income of the assessee is computed provided there is income and expenditure and in the assessee’s case under consideration there is no any income and expenditure therefore disallowance of expenditure (which related to the exempt income) is not required. That being so, we decline to interfere in the order of ld CIT(A), his order on this issue is hereby upheld and grounds of appeal raised by the Revenue is dismissed.

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• 2018 (3) TMI 1308
  Reopening of assessment - “change of opinion” and “formation of opinion” - slump sale u/s 50B - Held that:- In the case of Usha International (2012 (9) TMI 767 - DELHI HIGH COURT), as held that the expression “change of opinion” postulates formation of opinion and a change thereof and that there is a difference between “change of opinion” and “formation of opinion”. In the case of Gujarat Power Corporation Ltd., (2012 (9) TMI 69 - Gujarat High Court) it was held that after 01.04.1989 power for reopening of assessment within four years are much wider. In the case before us, though the assessee has filed the copy of the business purchase agreement, the A.O has not formed any opinion about the nature of the capital gain arising therefrom and therefore, it cannot be a case of change of opinion. Therefore, we do not find any reason to interfere with the order of the CIT(A) on this issue and the cross objection of the assessee is rejected. On reopening of the assessment the entire issue was before the A.O and the assessee had made the alternate claim of applicability of Sec. 50B of the IT Act to the transaction as a slump sale and in support of said claim has filed the Form No. 3CEA. The requirement to file Form No. 3CEA along with the return of income is to substantiate the claim u/s 50B of the Act. In the original return of income, since the assessee has not made the claim, the assessee could not have filed the Form No. 3CEA along with the return of income. Its only during the reassessment proceedings, that the assessee had made an alternate claim and therefore, the CIT(A) has rightly directed the A.O to assess the transaction arising out of the BPA as a slump sale u/s 50B of the IT Act. As regards the consideration towards slum sale, the CIT(A) has not only taken the agreed price of 4,00,00,000/- but also the additional consideration of 24,54,056/- as part of the consideration for all the assets listed in BPA. The assessee has not raised any ground of cross objection against treating the additional consideration also as the sale consideration for transfer of business u/s 50B of the IT Act. Therefore, the assessee has accepted the entire sale consideration to be 4,24,55,056. Since the CIT(A) has only remitted the issue to the file of the A.O for the considering the assessee’s alternate claim u/s 50B of the Act, we do not see any reason to interfere with the order of the CIT(A).

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• 2018 (3) TMI 1307
  Penalty u/s. 271(1)(c) - non specification of charge - defective notice - Held that:- We find that the notice dt. 24-12-2012 issued u/s. 274 r.w.s 271 of the Act does not specify the charge of offence committed by the assessee viz whether had concealed the particulars of income or had furnished inaccurate particulars of income. Hence the said notice is to be held as defective. - Decided in favour of assessee.

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• 2018 (3) TMI 1306
  Accrual of income - Addition on account of interest accrued on the loans advanced by the assessee - Held that:- As relying on assessee’s own case (2014 (12) TMI 300 - ITAT HYDERABAD and 2014 (9) TMI 317 - ITAT HYDERABAD), we hold that the notional interest on above advances cannot be charged on accrual basis and the Assessing Officer is directed to verify the interest actually received and assess the same on actual receipt basis. Accordingly, the appeal filed by the Revenue is allowed for statistical purposes.

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• 2018 (3) TMI 1305
  Assessment to the best satisfaction u/s 144 - non-production of the books of account - Held that:- Neither the A.O. nor the Ld. CIT(A) could verify any of the issues related to the Profit & Loss Account, balance sheet and trading account in the absence of non-production of the books of account. The assessee in the appeal hearing explained that the rice mills is closed and the assessee is suffering from losses and the representative who has to take care of the tax matters has not attended before the Assessing Officer. The correctness of the expenditure is required to be verified from the books of account. Therefore, we are of the considered opinion that the entire assessment should be remitted back to the file of the Assessing Officer to re-do the assessment de novo. - Decided in favour of assessee for statistical purposes.

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• 2018 (3) TMI 1304
  TDS u/s 194J - out of pocket expenses and payment to auditors - non deduction of tds - CIT-A deleted the tds levy - Held that:- As per the AR some amount was given to auditor for out of pocket expenses were paid by the assessee after deduction of tax. So in considered opinion, ld. CIT(A) has passed detailed and reasoned order, therefore, we do not want to interfere in the order passed by the ld. CIT(A) hence, this ground of appeal is dismissed. TDS u/s.194H or 194C - commission payments made to Sahayak - Held that:- Payment is made to Sahayak on percentage basis on various parameters like number of farmers pouring milk, fat and SNF factor in milk, quantity to mild collected etc. which ensures payment is commensurate with work performed. The nature of work carried out by the Sahayak are covered by provisions of section 194C and accordingly tax was deducted on the same accordingly. On the basis of the consistency, we dismiss this ground of appeal of department. Non deduction of tax at source under section 194J OR 194C - short deduction of tax on payment of commissioner charges paid to dairies - Held that:- Assessee provided raw milk and necessary materials to the dairies for processing as per specification of assessee. The dairies custom pack it on job work basis. Assessee deducted tax u/s.194C on conversion charges 19.77 crores paid to such dairies since the job work falls within definition of ‘work’ u/s.194C. CBDT circular No.13/2006 dated 13th Dec, 2006 relied. Further stated the services rendered by the dairies are not technical services since the dairies are not expert on any technology which they could provide to the assessee, nor they provide any managerial services/consultancy services since there is no advice given by dairies to the assessee. The dairies are not assigned any exclusive work relating to quality check but are assigned work relating to conversion/processing of milk and milk products, wherein one of the requirements is to ensure quality parameters. Payment made for getting jobs done like testing, inspection of materials, etc. were of nature of material & labour contract liable to TDS u/s.194C.

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• 2018 (3) TMI 1303
  Income from sale of shares - busniss income or capital gain - period of holding - Benefit of deduction u/s 35 denied - Held that:- Hon’ble Delhi High Court in the case of D & M Components Ltd. (2014 (4) TMI 866 - DELHI HIGH COURT) while deciding a somewhat identical issue has held that where there was short duration of holding of shares and lack of clarity in account books, sale and purchase of shares would lead to business income and not short term capital gains. The various other decisions relied by the assessee also supports his case that the profits in the instant case of purchase and sale of shares would amount to business income and not short term capital gain as held by the Assessing Officer. We set-aside the order of the ld. CIT(A) and direct the Assessing Officer to allow the claim of business income on account of profit on sale of such shares. Since the assessee succeeds on this issue, the claim of the assessee regarding the deduction u/s 35 of the I.T. Act is also allowed subject to verification of other conditions if any by the Assessing Officer. - Decided in favour of assessee.

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• 2018 (3) TMI 1302
  Condonation of delay in filing appeal before CIT(A) - ignorance of law by the Chartered Accountant - allowability of loss - section 94(7) of the I.T. Act - Held that: - there is an inordinate delay in filing the appeals before the Ld. CIT(A) without justification and as such, prejudice have been caused to the Revenue Department - Further, no sufficient cause have been disclosed in the explanation of assessee-company. Therefore, the Ld. CIT(A), correctly dismissed the appeals of the assessee-company by holding them to be time barred - appeal dismissed - decided against appellant.

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• 2018 (3) TMI 1301
  TDS u/s 195 - disallowance of the royalty payment in terms of section 40(a)(ia) - assessee has utilized the patents IPRs in India - Held that:- The facts of the case clearly indicate that the assessee company is also a tax resident in India, for the purpose of income tax and, therefore, the facts indicate that the assessee has utilized the patents IPRs in India and the products so manufactured with the aid of patents and IPRs are in reality exported to USA. Hence, the ld. CIT (Appeals)’s analogy is correct that DKLLC USA (assessee) has merely carried out the marketing of the products which are exported by the DKLLC India (assessee). Hence, we agree with the ld. CIT (Appeals) that the patent/IPRs are utilized for manufacturing activities in India and the rest of the activity, i.e., sale in USA has to be viewed in conjunction with this activity and the same cannot be isolated. Hence, the assessee’s contention that the patents, IPRs are utilized outside India and income has been earned from outside India are not sustainable. Hence, the ld. Commissioner of Income Tax (Appeals) is correct in holding that the disallowance of the royalty payment in terms of section 40(a)(ia) r/w s. 195 of the Act is justified. - Decided against assessee

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• 2018 (3) TMI 1300
  Revision u/s 263 - deny the claim of exemption for medical allowances, conveyance allowances and sumptuary allowances etc. - CIT had held that the allowances claimed as exemption on the basis of the recommendation of Shetty Commission Report as approved by the Hon’ble Supreme Court were not exempted under the I.T.Act and hence the assessments are to be revised - Held that:- Since the Hon’ble High Court [2016 (3) TMI 1291 - KERALA HIGH COURT] had held that acceptance of the Shetty Commission Report by the Hon’ble Apex Court is not a declaration of law and since there is no provision under the Income-tax Act or the Rules, whereby Medical, Conveyance and Sumptuary allowances are exempt from taxation, we hold that CIT is justified in invoking his revisionary jurisdiction u/s 263 of the I.T.Act. - Decided against assessee

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• 2018 (3) TMI 1299
  Annual letting value of unsold flats - Charging deemed income by taking Annual Letting Value(ALV) of unsold flat, which is closing stock of the assessee - Held that:- As relying on case of CIT vs. Ansal Housing Finance & Leasing Co. Ltd. [2012 (11) TMI 323 - DELHI HIGH COURT ] wherein it is held that the annual letting value of the unsold stock i.e. closing stock is assessable as deemed rent in the hands of the assessee, assessed the same as deemed income. - Decided against assessee.

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• 2018 (3) TMI 1298
  Validity of assessment u/s 143(3) r.w.s. 144C - No draft assessment order but final assessment order passed - no notice u/s. 143(2) was served - Held that:- Issue arising before us being identical to the issue before Tribunal in DCIT Vs. M/s. Rehau Polymers Pvt. Ltd. (2017 (8) TMI 1294 - ITAT PUNE), we hold that the draft assessment order passed by the AO was complete assessment order which is not envisaged under section 143(3) r.w.s. 144C of the Act. Accordingly, we hold that the draft assessment order passed in the case is invalid in law. - Decided in favour of assessee.

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• Customs

• 2018 (3) TMI 1297
  Release of seized vehicle - restriction from moving the vessel out of the jurisdiction of the Indian authorities/competent courts in India - Held that: - an affidavit to be filed incorporating therein an undertaking of the petitioner that the subject seized vessel would be released to the petitioner only for the purpose of the fulfillment of their contractual obligation with the Oil and Natural Gas Corporation, the vessel will not be moved out of the jurisdiction of the Indian authorities/competent courts in India and that in the event there is an adjudication order passed by the competent authority, then, subject to the legal rights of the petitioner, they would abide by the same - Else and in the absence of such an affidavit-cum-undertaking, the writ petition would stand dismissed without any further reference to the court.

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• 2018 (3) TMI 1296
  Effective alternative remedy - Misuse of Tariff Rate Quota Scheme in the import of popcorn maize by M/s.Haji Sattar & Sons, Chennai - Section 129 A(1) of the Customs Act, 1962. Held that: - when there is an effective and alternative remedy under Section 129 A(1) of Customs Act, 1962, it would not be appropriate to entertain a writ petition, on the disputed questions of facts - On more than one occasion, the Hon'ble Supreme Court, as well as this court, held that, ordinarily, writ petitions should not be entertained when the statutes provide for an effective and alternative remedy, moreso, in revenue matters. There is no material illegality or irregularity in the impugned order - appeal dismissed.

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• 2018 (3) TMI 1295
  Petitioner has not been issued duty credit scrips under the Merchandise Exports From India Export Scheme in terms of Chapter 3 of the Foreign Trade Policy - Held that: - the respondent no.2/DGFT will once again write to its counterpart in the DRI, that is, the investigating authority and put it to notice that if no response is received within four weeks of receipt of its communication, it will issue duty credit scrips in favour of the petitioner - The respondent no.2/DGFT will also telephonically interface with his counterpart in the DRI to hasten the matter - petition disposed off.

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• Corporate Laws

• 2018 (3) TMI 1294
  Voluntary Winding up - Held that:- OL has scrutinized the records submitted by the Voluntary Liquidator, and has recorded satisfaction that necessary compliances of Sections 484 to 497 and other relevant provisions of the Act read with the Companies (Court) Rules, 1959 have been made, and that the affairs of the said Company have not been conducted in a manner prejudicial to the interest of its members or to the public. The OL, in these circumstances, has sought dissolution of the said Company from the date of filing of the petition i.e. 25.01.2018. Due compliances have been observed with by the Voluntary Liquidator and the Directors of the said Company, and resultantly a satisfaction has been recorded by the OL that all necessary compliances under the Act have been met by them. In view of the same, the said Company is ordered to be dissolved with effect from 25.01.2018, i.e. from the date of the filing of the present company petition. Copy of this Order be filed by the OL with the concerned ROC within the statutory period as per the Act.

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• 2018 (3) TMI 1293
  Attachment orders - collective investment scheme - SEBI found fault in the scheme - Recovery Officer has attached all accounts, lockers whether held singly or jointly by the petitioner - Held that:- The petitioner has been able to make out the case that the order which has been passed is non-est as it takes away a vital right conferred upon the notice/defaulter under Clause 2 of the Second Schedule of the Income Tax Act, 1961. Accordingly, the impugned order is set aside giving liberty to the Recovery Officer to issue a fresh demand notice pursuant to the recovery certificate drawn up by him as required under Clause 2 of the Second Schedule of the Income Tax Act, 1961. The only caveat being is that since moneys have already been transmitted to the Board, it will retain the same in trust till such time the Recovery Officer passes a final order after issuance of notice, giving due opportunity to the petitioner to respond to the same. In case the Recovery Officer agrees with the contention of the petitioner that in terms of the order of the Board, he could not have been characterized as the defaulter, the logical corollary would be that the Board would have to return the moneys held in trust by it. Needless to say if the Recovery Officer reaches a contrary conclusion, then, the Board would continue to hold the moneys and use the same as mandanted by law. With the aforesaid observations, the writ petition is disposed of.

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• 2018 (3) TMI 1292
  Compounding of offences - joint application of default - Held that:- Since all the five applications as listed above pertains to default in relation to filing of Annual Returns which is required to be filed for each year and the default is in relation to more than a year and as the same offence had been committed for the second or subsequent occasions within a period of three years and as the defaulted section being section 92 provides for fine or imprisonment or with both, for the officers in default thereby making it virtually non-compoundable by virtue of operation of section 451 read with section 441(6) of the Companies Act, 2013 this Tribunal does not have jurisdiction to compound the offence as dealt with in detail under Issue No.3 supra. (b) Further a joint application for the default committed under the 1956 Act as well as 2013 Act filed is also not maintainable in view of the position as enunciated and dealt with under Issue No.4 supra. (c) In any case under the 2013 Act since the maximum amount of fine prescribed for the offence of not filing annual returns is not in excess of five lakh rupees, this Tribunal lacks the pecuniary jurisdiction to entertain the compounding applications as listed above

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• Insolvency & Bankruptcy

• 2018 (3) TMI 1320
  Institution of proceedings in NCLT - Held that:- No bar on NCLT to trigger an Insolvency Resolution Process on an application filed under sections 7,9 & 10 if a winding up petition is pending unless an official liquidator has been appointed and a winding up order is passed. The cognate question as to whether Insolvency Resolution Process could be triggered where official/provisional liquidator has been appointed is left open as in none of the cases before us such a question would arise.

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• 2018 (3) TMI 1319
  Initiate insolvency resolution process against the respondent-corporate debtor - existence of debt on the basis of assignment deed - application by competent person - Held that:- the document of assignment cannot be rejected by this Tribunal while disposing of the instant petition on the ground of being insufficiently stamped though the petitioner would be bound by the consequences if any adverse order on changing of stamp duty comes into play. As the financial creditor has been able to show the existence of default committed by the respondent-corporate debtor on the basis of evidence furnished by the financial creditor. There was no dispute of the respondent-corporate debtor to have borrowed the debt from the Bank and that the respondentcorporate debtor is in default as defined in Section 3(12) of the Code. The "default" means non-payment of debt when whole or any part or instalment of the amount of debt has become due and payable and is not repaid by the debtor or the corporate debtor, as the case may be. The other requirement of sub-Section (3) of Section 7 of the code is that the financial creditor is to propose the name of the Resolution Professional to act as Interim Resolution Professional. In this case, the financial creditor has proposed the name of Mr.Manoj Sehgal, registered Resolution Professional with the IBBI to act as Interim Resolution Professional and filed written communication in Form No.2 Annexure-116 which is found in order. He has furnished his registration number also. The application being complete and it is made out that the corporate debtor has committed default, the petition deserves to be admitted.

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• FEMA

• 2018 (3) TMI 1291
  Appeal for non-compliance of pre-deposit of penalty - Held that:- All the information provided proves that the conduct of the appellant/his counsel has not been very honest and they have tried to misguide the tribunal. That they have failed to file a review petition within a reasonable time is apparent from above, and are now coming up with some ground or the other. The judgements relied upon by the learned counsel of the appellant during hearing as ground do not help them as none of the Judgements deals with condonation of delay when the conduct of the appellant in making the said application is in doubt. The Miscellaneous Application for condonation of delay in filing the Review Petition is therefore, dismissed.

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• Service Tax

• 2018 (3) TMI 1288
  Levy of service tax on receipt of amount after new levy whereas the contract was Concluded before levy - whether the law came into force w.e.f. 1-7-2003 and the concluded contract which has entered prior to coming into force of the law where the taxing statute has taken place on 1-7-2003 should be taxed if the contract is concluded and the services are rendered thereafter? - Circular 65/14/2003, dated : Nov. 5, 20 F. No, B3/7/2003-TRU. Held that: - The assessee herein has entered into a concluded Contract much prior to coming into force of Service Tax law and in view of the clarification which has been issued in 2005 which clearly made out the case for the appellant inasmuch as the legislation has now used the language after 2005 - it is very clear that prior thereto, there is authority interpretation of the provision as services which are referred to be provided in future was not covered. Even otherwise in view of the law Concluded Contract cannot be revived in view of subsequent development which will lead to a very odd situation with the assessee and he has to suffer in his business and has to face the breach of contract. Any payment of contract which are entered after 1-7-2003 will invite Service Tax and any contract which is concluded prior to 1-7-2003 will not invite imposition of Service Tax. Appeal allowed - decided in favor of assessee.

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• 2018 (3) TMI 1287
  Business Support Services - appellant was engaged in providing services to ICICI Bank by way of receipt of fresh applications for sanction of loan, credit cards etc. - Department was of the view that the activity carried out by the appellant will be covered by the definition of business support services under Section 65 (105)(zzzq) of the Finance Act, 1994 which was introduced with effect from 01.05.2006 - Held that: - the appellant was under bonafide belief that the activities will be covered under the category of information technology software inasmuch as, the appellant was also required to develop the software template into which the date is to be entered. Under the circumstances, the appellant was entertaining a bonafide belief that the activities will not fall under the activity of business support service. Further, the demand has been raised for the period immediately after the category of business support service was introduced into the statute books. Consequently, the Revenue is not justified in raising the demand by invoking the suppression clause under Section 73. Hence, the demand of Service Tax is to be restricted to that falling within the normal time limit. Demand for normal period upheld - Adjudicating Authority is directed to re-quantify the demand - appeal allowed in part by way of remand.

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• 2018 (3) TMI 1286
  CENVAT credit - input services - construction of immovable property - demand of service tax - notional interest on security deposit towards renting of immovable property service - Held that: - the Revenue has wrongly denied the cenvat credit on various input services which have been used for construction of immovable property which is ultimately rented out - reliance placed in the case of City Centre Mall Nashik Pvt. Ltd. Versus Commissioner of Central Excise & Service Tax, Nashik [2017 (11) TMI 301 - CESTAT MUMBAI], where it was held that the appellant is entitled to cenvat credit on input services used for construction of immovable property - credit allowed. Demand of service tax - notional interest - Held that: - the issue is squarely covered by the judgment of the Tribunal in the case of Magarpatta Township Developers & Construction Co. Ltd. [2014 (9) TMI 461 - CESTAT MUMBAI], wherein the Tribunal has held that notional interest cannot be included in the value and will not be taxable under the category of renting of immovable property services - no service tax is chargeable on notional interest. Appeal allowed - decided in favor of appellant.

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• 2018 (3) TMI 1285
  Valuation - pure agent - inclusion of reimbursement of expenses - charges viz; Manpower, Telephone expense, freight on Stock Transfer, loading & unloading charges, Stationary Charges, Courier, Packing, Electricity, Office & Godown expenses - pure agent - Rule 5(2) of STR - Held that: - neither the contracts made between the appellant with service recipients nor such conditions, which were required to be specified to be a Pure Agent were not specified and spelt out in the said SCN. It was only stated that it was found by Audit Officers that the conditions of Pure Agent were not satisfied by the appellant - the allegations are bald and the SCN is not sustainable - appeal allowed - decided in favor of appellant.

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• 2018 (3) TMI 1284
  Valuation - includibility - value of materials supplied free of cost - Held that: - it is an admitted fact that on the materials supplied by the appellant, VAT has been paid by the appellant in terms of N/N. 12/2003-ST dated 26.06.2003. Therefore, the appellant is not required to add the value of materials supplied by them in the assessable value of service provided by them - appeal allowed - decided in favor of appellant.

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• 2018 (3) TMI 1283
  Business Auxiliary Service - booking of luggage on behalf of the bus owners - Held that: - Since the bus owners are clients of the appellant, on whose behalf booking of luggage was made, the same should fall under the taxable category of “Business Auxiliary Service. With regard to the submission of the appellant that the service tax should be levied on the actual commission earned by the appellant, that neither there is any agreement, of any correspondence exchanged between the appellant and the bus owners providing for the actual commission payable to the appellant for providing such service. Thus, in absence of any documentary evidence, the plea raised by the appellant cannot be accepted. Appeal dismissed - decided against appellant.

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• 2018 (3) TMI 1282
  Man Power Recruitment or Supply Agency Service - Held that: - Since the appellant was no way connected with any recruitment or supply of manpower to the client, rather the manpower/employees were under the active control and supervision of the appellant and were deployed for undertaking the assigned job work entrusted by the principal, such service should not fall under the taxable category of „Manpower Recruitment and Supply Agency Service - appeal allowed - decided in favor of appellant.

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• 2018 (3) TMI 1281
  GTA service - reverse charge mechanism - After collecting the amounts from their clients they pay the charges to the transporters from whom the vehicles were engaged and service tax of entire freight charges for the amounts billed by appellants is discharged by their clients under reverse charge mechanism as a recipient of GTA services - whether appellant is required to discharge the service tax liability under the category of goods transport agency or otherwise? Held that: - The definition of a person liable to discharge service tax liability under goods transport agency is under reverse charge mechanism and has been ensigned under Section 65(50)(b) of the Finance Act 1994 read with the said Rules - service tax liability on goods transport agency services is under reverse charge mechanism more so if the consignor or consignee falls in one of the category as indicated hereinabove or a person who is liable to pay freight charges. It is on record that appellant herein does not discharge the freight charges but claims the amount from their client who pays it to the transporters from whom they engaged the vehicles. The demands raised by the lower authorities and confirmed cannot be upheld as identical issue came up before the Tribunal in the case of Essar Logistics Ltd Vs CCE Surat [2014 (6) TMI 763 - CESTAT AHMEDABAD], where it was held that it is very clear that the legislative intent is to tax only the services provided by a Goods Transport Agent to a customer and not the owner. - Therefore, the appellant has no liability to pay the service tax. Appeal allowed - decided in favor of appellant.

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• Central Excise

• 2018 (3) TMI 1280
  CENVAT credit - non-compliance of the requirement of sub-rule (7) of Rule 4 of the Cenvat Credit Rules, 2004 - non-payment of entire invoice value claimed by the service provider - Held that: - identical issue decided in the case of Hindustan Zinc Ltd. [2018 (3) TMI 1187 - CESTAT, NEW DELHI], where it was held that no reversal of credit under Rule 14 can be ordered in such situation - appeal allowed - decided in favor of appellant.

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• 2018 (3) TMI 1279
  Method of valuation - captive consumption - when the manufactured goods are captively consumed whether Revenue can resort to Rule 11 of Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 for determination of value of captively consumed goods? Held that: - it is seen that wording of said Rule 11 of Valuation Rules, 2000 indicates that if the value of any excisable goods cannot be determined under Rules up to Rule 10A then the value is to be determined using reasonable means consistent with the principles and general provisions of Section 4 - for the circumstances covered in the present case there is provision under Rule 8 of said Valuation Rules, 2000, which reads “Rule 8, where the whole part of the goods are not sold by the assessee but are used for consumption by him or on his behalf in the production or manufacture of other articles, the value of said goods i.e. consumed shall be 110% of the cost of production or manufacture of said goods”. Since express provision covering the circumstances being available under said Rule 8 of Valuation Rules, 2000, there was no case to resort the provisions of said Rule 11 of Valuation Rules, 2000 - appeal allowed - decided in favor of appellant.

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• 2018 (3) TMI 1278
  SSI exemption - use of Brand Name - N/N. 8/2003-CE dated 01.03.2003 - It appeared to revenue that “OMFA PREMIUM” and “ENDURA HITECH” brands were not belonging to respondent - Held that: - the respondents were rightly holding the ownership of both the brands - it is also established that the said SCN was without any basis - appeal dismissed - decided against Revenue.

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• 2018 (3) TMI 1277
  Whether untrimmed sheets/circles of Brass manufactured by the respondent were leviable to Central Excise Duty as an intermediate product arising in the course of manufacture of trimmed product and waste and scrap attracting Nil rate of duty being captively consumed or whether the said untrimmed sheets of brass were leviable to Central Excise duty? Held that: - It is very clear from the ruling by Hon’ble Supreme Court in above said case of CCE, Jaipur vs. M/s Mewar Bartan Nirman Udyog [2008 (9) TMI 33 - SUPREME COURT] that all gods falling under Heading No. 7409 made of Brass and intended for use in the manufacture of utensils and handicrafts shall attract Nil rate of duty. Undisputedly untrimmed sheets of brass were being used in the manufacture of utensils and handicrafts and, therefore, they were attracting Nil rate of duty and, therefore, the question of applicability of said N/N. 67/95 did not arise. Appeal dismissed - decided against Revenue.

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• 2018 (3) TMI 1276
  CENVAT credit - Rent-a-Cab Operator Service - Outdoor Catering Service - whether the appellants are entitled to Cenvat Credit of 11,90,543/- of Service Tax paid on Rent-a-Cab Operator Service and Outdoor Catering Service of 5,24,328/- during the period July 2015 to Sept. 2015? Held that: - As far as the credit of service tax paid on Rent-a-Cab Service used by the appellant in bringing the employees to the factory of the appellant for the period after 01.04.2011 the same cannot be held as an input service and allowed to credit in view of the specific exclusion containing the definition of amended input service - credit availed on Rent-a-Cab Service is not admissible. Outdoor Catering Service - Held that: - the issue is covered by the judgement of this Tribunal in Reliance Industries Ltd case [2016 (8) TMI 123 - CESTAT MUMBAI], where it was held that In the absence of any such dispelling, it is to be held that these services on which CENVAT Credit have been availed are not for personal consumption of the employee but it was billed for service provided for business meetings, and credit is allowed - credit is admissible on the service tax paid on Outdoor Catering Service (Canteen Service) for providing it to the employees in their factory premises. Appeal allowed in part.

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• 2018 (3) TMI 1275
  Classification of goods - Terminal and Computer upgrades/up-gradation - whether classified under CSH 8471.00 of Central Excise Tariff Act as parts and accessories of computer or otherwise? - Held that: - even after change of computer upgrades the other parts such as computer system, monitor, key board, mouse etc. are unchanged. In this fact, it is clear that upgrade units though helps in enhancing the capacity of the computer but unit itself is not complete machine therefore it cannot fall under Chapter 8471.00 since upgrades units being sub assembly - appeal dismissed - decided against appellant.

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• 2018 (3) TMI 1274
  Demand of duty with interest - demand on the ground that the applicant is not contesting the payment of duty and interest - Held that: - The Hon'ble Allahabad High Court in the case of J.K. Cotton Spinning & Weaving Mills Co. Ltd. [2013 (9) TMI 62 - ALLAHABAD HIGH COURT] held that by application of Sections 22 & 32 of Act, 1985, recovery proceedings against the assessee were not maintainable - it is required to examine the BIFR Order. The appellant should be given an opportunity to place the records in respect of BIFR order for claiming exemption from payment of interest - appeal allowed by way of remand.

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• CST, VAT & Sales Tax

• 2018 (3) TMI 1273
  Writ of Certiorarified mandamus to call for the records relating to the impugned order dated 10.11.2017 for the assessment year 2009-10 passed by the 1st respondent - Held that: - the issue involved in the Writ Petition is mismatch and such issue is already covered by the decision of this Court in the case of M/s. JKM Graphics Solutions Private Limited Versus The Commercial Tax Officer [2017 (3) TMI 536 - MADRAS HIGH COURT]. This Court, in the said decision, has directed the Assessing Officer to evaluate a centralised mechanism exclusively to deal with the cases of mismatch and to do some exercise, before issuing a notice. The Assessing Officer has to re-do the assessment - the matter is remitted back to the Assessing Officer to re-do the assessment commencing from the stage of issuing notice of proposal.

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• 2018 (3) TMI 1272
  Incentive schemes for setting up new and expansion of such industries - interim stay of assessment order - Held that: - Before the writ Court, appellant has not filed counter affidavit. Before us, respondent has brought fresh facts and supporting documents. Parties are at liberty to raise appropriate pleadings before the writ Court with supporting documents - Before the writ Court, the respondent had the benefit of interim stay of assessment order dated 27.08.2015. Inasmuch as the order made in W.P.No.30426 of 2015, is set aside, interim order made in MP No.1 of 2015 in W.P.No.30426 of 2015, stands restored. Appeal disposed off.

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• 2018 (3) TMI 1271
  Demand of Interest - cancellation of the deferral agreement entered into the petitioner with the 3rd respondent - Held that: - the first payment of 15,00,000/- has been paid well before the cancellation of the agreement and the second instalment has been paid on 13.04.2007 well before the pre-emptive date viz., 22.09.2008, had the deferral agreement been in force - the interest payable by the petitioner shall be only from the date of cancellation of the agreement viz., 24.01.2007 till the date of payment viz., 13.04.2007. The matter is remanded to the 1st respondent to levy interest for the period from 24.01.2007 to 13.04.2007 - petition allowed by way of remand.

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• 2018 (3) TMI 1270
  Principles of Natural Justice - ROM application rejected by an non-speaking order - Section 84 of the TNVAT Act, 2006 - Held that: - When orders have been passed in the rectification petitions, setting aside the same, with the above directions, the contention of the appellant that the writ Court should have set aside the assessment orders, dated 29.11.2013 also, cannot be accepted. From the grounds, it could be deduced that the appellant requires this Court to do the exercise, as to whether, inclusion of purchase turnover in the assessment for years 2008-09 and 2009-10 respectively, is correct or not, which exercise has been directed to be done by the assessing officer. Appeal dismissed.

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• 2018 (3) TMI 1269
  Imposition of penalty u/s 51(7) of the PVAT Act - Whether on the facts and in the circumstances of the case, the penalty u/s 51(7) of the PVAT Act can be imposed merely for non-declaration of goods at ICC when no deficiency has been pointed out in the documents accompanying the goods? - Held that: - Learned counsel for the appellant-assessee has not been able to show that the findings recorded by the Tribunal are illegal or perverse or are based on misreading of evidence on record warranting interference by this Court. He has also not been able to produce any material to substantiate its claim made in the appeal - no substantial question of law arises - appeal dismissed - decided against appellant.

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• Indian Laws

• 2018 (3) TMI 1290
  Deposit the fine amount awarded - suspension of sentence of the appellant - appellant relying on Section 357 subSection (2) of Criminal Procedure Code submits that since the appellant has already filed an appeal before the High Court, the amount of fine imposed by the trial court automatically stands stayed till the decision of the appeal - whether by virtue of Section 357(2) Cr.P.C., the said fine which was part of sentence automatically was stayed till the decision of the appeal and would not have been directed by the High Court to be deposited by the appellant? Held that: - Section 357(1) Cr.P.C. contemplated utilisation of fine imposed in certain circumstances as compensation to be paid to victim. Subsection (2) engrafted an embargo that such payment shall not be made till the period allowed for appeal has elapsed or if the appeal is filed, till the same is decided. Legislature was conscious that compensation paid if utilised, there may not be appropriate measures to recover the said amount utilised from victim to whom the compensation is paid hence embargo in payment has been engrafted in subsection (2). Thus at best subsection (2) of Section 357 Cr.P.C. is a provision which differs or withholds the utilisation of the amount of compensation awarded till the limitation of appeal elapses or if filed till it is decided. The provision in no manner stays the sentence of fine during the pendency of the appeal - Appellate Court while exercising power under Section 389 Cr.P.C. can suspend the sentence of imprisonment as well as of fine without any condition or with conditions. There are no fetters on the power of the Appellate Court while exercising jurisdiction under Section 389 Cr.P.C.. The Appellate Court could have suspended the sentence and fine both or could have directed for deposit of fine or part of fine. Section 357(2) Cr.P.C. was not attracted in the present case since there was no direction of payment of any compensation out of the fine imposed by the trial court as part of sentence. Section 357 Cr.P.C.(2) comes into play only where any order of payment of compensation utilising the fine imposed as sentence under Section 357(1) Cr.P.C. or compensation as directed under Section 357(3) Cr.P.C. is made - Present being neither a case of Section 357(1) Cr.P.C. nor Section 357(3), subsection( 2) of Section 357 Cr.P.C. is clearly not applicable and the submissions raised by the learned counsel for the appellant are without any substance. Appeal dismissed - decided against appellant.

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• 2018 (3) TMI 1289
  Charitable hospital - Property tax on building - exemption from property tax - the second respondent by order dated 17.12.2015, rejected the claim for exemption, for the reason that only 15% of the patients get free treatment and therefore, the petitioner is not a charitable hospital within the meaning of Section 101(e) of the Act. Held that: - There is no allegation against the petitioner that they have violated the conditions of allotment and the Government has not taken any action. Therefore what would be the proper percentage for qualifying for exemption from property tax has to be decided. At best the percentage fixed in G.O.Ms.No.460 would be an indicator. There may be a situation where even offering lesser percentage of free treatment, would still qualify for exemption, because of the specialized type of treatment offered free. Therefore, the percentage should not be misunderstood as purely a numerical figure. The respondent Corporation should take note of all the above observations how the Courts have approached the matter what other statute say and then examine the plea of the petitioner. Though the petitioner seeks for a positive direction to grant exemption, such relief cannot be granted in a Writ Petition under Article 226 of the Constitution of India, as it requires thorough and deep scrutiny of the various documents and records that the petitioner will produce. Therefore, necessarily matter has to be remanded to the respondent corporation for fresh consideration. Petition allowed by way of remand.

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