TMI Tax Updates - e-Newsletter
March 29, 2025

Case Laws in this Newsletter:

GST Income Tax Customs Corporate Laws Insolvency & Bankruptcy PMLA Service Tax Central Excise Indian Laws

TMI Short Notes

1. Understanding the Tax Implications on benefits obtained from the remission or cessation of liabilities in Clause 95 of the Income Tax Bill, 2025 Vs. Section 59 of the Income-tax Act, 1961

  Bill:

2. Disallowing deductions of specific expenses in Clause 94 of Income Tax Bill, 2025 vs. Section 58 of Income Tax Act, 1961

  Bill:

3. Deductions available under "Income from other sources" in Clause 93 of Income Tax Bill, 2025 VS. Section 56 of Income Tax Act, 1961

  Bill:

4. Modernizing Tax Treatment of Income from other Sources in Clause 92 vs. Section 56 of the Income-tax Act, 1961

  Bill:

5. Enhancing Fair Market Valuation in Clause 91 of Income Tax Bill, 2025 vs. Section 55A of Income Tax Act, 1961

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6. Interpretations of key terms related to capital gains "adjusted," "cost of improvement," and "cost of acquisition" in Clause 90 of Income Tax bill 2025 vs. Section 55 of Income Tax Act, 1961

  Bill:

Articles

1. ITC cannot be denied due to wrong address and GSTN on invoices

   By: Bimal jain

2. One Nation, One Tax

   By: Subbiah Sridhar

3. Applicability of Section 125 of the CGST Act

   By: K Balasubramanian

4. OFFENCES UNDER GST LAW (PART-4)

   By: Dr. Sanjiv Agarwal

5. Memes or Distraction Tax

   By: Subbiah Sridhar

6. AUTHORITIES UNDER THE PROHIBITION OF BENAMI TRANSACTIONS ACT, 1988

   By: DR.MARIAPPAN GOVINDARAJAN

7. Step by Step Process to File OPC Annual Return Online

   By: Ishita Ramani

8. How Customs Brokers Are Facilitating India’s EXIM Trade?

   By: YAGAY andSUN

9. How Container Corporation of India Ltd (CONCOR) is Redefining the Logistics for Indian Exports.

   By: YAGAY andSUN

10. India and European Union: Bilateral Ties and Trade Relationship - A Comprehensive Analysis.

   By: YAGAY andSUN

11. India and Israel: Bilateral Ties and Trade Relationship - A Comprehensive Analysis

   By: YAGAY andSUN

12. India and New Zealand: Bilateral Ties and Trade Relationship - A Comprehensive Analysis.

   By: YAGAY andSUN

13. India and South Korea: Bilateral Ties and Trade Relationship - A Comprehensive Analysis.

   By: YAGAY andSUN

14. India and Japan: Bilateral Ties and Trade Relationship - A Comprehensive Analysis.

   By: YAGAY andSUN

15. India and RCEP (Regional Comprehensive Economic Partnership).

   By: YAGAY andSUN

News

1. Haryana adopts its state song on concluding day of budget session

2. Atishi questions BJP government over budget transparency

3. Budget reflects AAP govt's commitment to transforming Punjab: FM Cheema

4. Punjab Assembly: Opposition MLAs call state budget 'directionless'

5. Latur civic body's 2025-26 budget allots funds for social welfare, infrastructure projects

6. Congress couldn't find anything to criticise Budget: Sitharaman

7. Opposition targets govt on US tariff threats, demands clarification on its response in RS

8. Parliament approves Finance Bill 2025, completes Budget FY26 exercise

9. Government of India and Government of Japan sign loan agreements worth JPY 191.736 billion for six projects under Japan’s Official Development Assistance to India

10. Monthly review of accounts of Government of India upto February, 2025 (FY2024-25)

11. Cabinet approves release of an additional instalment of Dearness Allowance to Central Government employees and Dearness Relief to Pensioners w.e.f. 01.01.2025

12. CAD widens to USD 11.5 bn in Q3 on higher trade deficit: RBI

13. RBI allows banks to hike ATM charges to Rs 23/withdrawal beyond free monthly usage from May 1

14. Corporate Affairs Ministry hosts the 3rd ‘Candidate Open House’ for the PM Internship Scheme

15. RBI Governor Sanjay Malhotra calls on President Murmu

16. Yunus, Xi discuss expanding economic ties; Chinese president assures support to Bangladesh's interim govt

17. Govt levies 10 pc import duty on chana from April 1

18. Frequently Asked Questions on ‘Restaurant Service’ supplied at ‘Specified Premises’

19. 90th Meeting of Network Planning Group under PM GatiShakti evaluates key Infrastructure projects

20. National Academy of Customs, Indirect Taxes, and Narcotics (NACIN) and Indian Maritime University (IMU) sign MoU for strategic knowledge partnership

21. Government’s borrowing plan for the first half of FY 2025-26

22. Issuance Calendar for Marketable Dated Securities for April 2025 ­- September 2025

23. Calendar for Auction of Government of India Treasury Bills (For the Quarter ending June 2025)

24. RBI Conducts 8th State Level Coordination Committee Meeting in Sikkim

25. Trump places 25% tariff on imported autos, expecting to raise USD 100 billion in tax revenues

26. From birth to death, one has to pay tax at every step: AAP MP Raghav Chadha in RS

Notifications

Customs

1. 20/2025 - dated 27-3-2025 - Cus

Seeks to amend Notification No. 11/2018-Customs, dated the 2nd February, 2018 and Notification No. 11/2021-Customs, dated the 1st February, 2021 - to exempt from Agriculture Infrastructure and Development Cess (AIDC) and Social Welfare Surcharge (SWS) - Therefore to impose a total import duty of 10% on import of Bengal gram (desi chana) (HS 0713 20 20) from 1st April, 2025

2. 16/2025 - dated 26-3-2025 - Cus (NT)

Appointment of Common Adjudicating Authority for the purpose of finalization of Provisional Assessment in SVB case w.r.t. M/s Delhi Airport Metro Express Pvt. Ltd.

GST

3. 11/2025 - dated 27-3-2025 - CGST

Central Goods and Services Tax (Second Amendment) Rules, 2025

SEBI

4. SEBI/LAD-NRO/GN/2025/239 - dated 27-3-2025 - SEBI

Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) (Amendment) Regulations, 2025

Circulars / Instructions / Orders

SEBI

1. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2025/38 - dated 28-3-2025

Extension of timelines for submission of offsite inspection data

2. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2025/39 - dated 28-3-2025

Extension of timelines for submission of offsite inspection data

3. SEBI/HO/MRD/TPD-1/P/CIR/2025/41 - dated 28-3-2025

Intraday Monitoring of Position Limits for Index Derivatives

4. SEBI/HO/CFD/CFD-PoD-1/P/CIR/2025/42 - dated 28-3-2025

Measures to facilitate ease of doing business with respect to framework for assurance or assessment, ESG disclosures for value chain, and introduction of voluntary disclosure on green credits.

GST

5. 248/05/2025 - dated 27-3-2025

Various issues related to availment of benefit of Section 128A of the CGST Act, 2017

DGFT

6. 53/2024-2025 - dated 28-3-2025

Amendment in ANF-4J for issuance of Diamond Imprest Authorisation (DIA)

Highlights / Catch Notes

GST

• Time-Barred GST Demand Quashed: Three-Year Limitation Under Section 73(10) Expired Before Order Issuance

  Case-Laws - HC : HC quashed an ex-parte demand order and show cause notice issued on 14.12.2023 for the financial year 2017-18 as time-barred under Section 73(10). Following the precedent in M/s Anita Traders, the court determined that due to notification extensions, the three-year limitation period for orders under Section 73(9) expired on 05.02.2023. The court rejected arguments that the deadline extended to 31.03.2023, finding the impugned orders issued well beyond the prescribed limitation period and therefore void for lack of jurisdiction. The petition was allowed, with the challenged orders declared ultra vires for exceeding statutory time limitations.
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• Taxpayer Wins Remand After Assessment Order Made Without Adequate Hearing Opportunity

  Case-Laws - HC : The HC set aside both the assessment order and rectification order, remanding the matter to the assessing authority for fresh consideration. The Court found that the respondent violated principles of natural justice by issuing the impugned assessment order without providing sufficient opportunities to the petitioner. Despite the petitioner's requests for adjournment to file detailed replies with supporting documents and for personal hearing following show cause notices, the respondent proceeded with the assessment. The Court held that when confirming a demand, authorities must provide adequate opportunity of hearing, which was denied in this case, necessitating remand for consideration on merits.
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• Anticipatory Bail Granted in GST Case Where Timely Returns Filed and No Loss to State Exchequer

  Case-Laws - HC : In an anticipatory bail application involving allegations of financial misconduct, the HC granted relief to the petitioner. The Court determined that no loss was caused to the State Exchequer as the petitioner had filed GST returns punctually, with purchases by him and his firm accurately reflected in the vendor's GST R-1 Return, GST 2-A, and 3-B returns. All taxes were paid promptly. The Court considered the petitioner's willingness to join the investigation and cooperate with investigating officers as averred in paragraph 16 of the petition. Consequently, the anticipatory bail application was allowed subject to fulfillment of imposed conditions.
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Income Tax

• Tax Rules Amended: Section 194T Added to Forms 26Q and 27Q for TDS on Partner Payments

  Notifications : CBDT has amended the Income-tax Rules, 1962 through the Income-tax (Seventh Amendment) Rules, 2025, effective upon publication in the Official Gazette. The amendment incorporates section 194T into Form 26Q and Form 27Q for TDS returns. Form 26Q now includes section 194T for reporting TDS on payments of salary, remuneration, commission, bonus, or interest to firm partners, with deduction code "94T." Similarly, Form 27Q has been updated to include section 194T for non-resident partners, positioned before the existing section 195 entry. These modifications streamline TDS reporting requirements for payments to partners of firms.
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• Electricity Pricing Between Related Units: CUP Method Rejected for Regulated Power Sector Under Transfer Pricing Rules

  Case-Laws - AT : The ITAT ruled in favor of the appellant regarding transfer pricing of electricity from its captive power plants to its cement unit. The Tribunal rejected the TPO's benchmarking based on supplies by various power companies, finding that electricity pricing is a regulated activity and therefore not an "uncontrolled condition" suitable for CUP method comparison. Following M/s. Jindal Steel and Power Ltd. (SC, 2023), the ITAT held that the appropriate benchmark was the rate charged by the State Electricity Board (AVVNL) to industrial consumers. The Tribunal concluded that the appellant's transfer price of Rs. 7.40 per unit represented ALP, and directed the deletion of adjustments proposed by the TPO and confirmed by the DRP.
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• Transport Payments Exempt from TDS Under Section 194C(6) When Sub-Contractors Own Fewer Than 10 Goods Carriages

  Case-Laws - AT : The ITAT allowed the appellant's appeal against disallowance under section 40(a)(ia) for non-deduction of TDS on payments to transport sub-contractors. The Tribunal held that the appellant had properly complied with section 194C(6) by collecting declarations from 12 sub-contractors confirming they owned fewer than 10 goods carriages, which exempted these payments from TDS requirements. Despite the AO's and CIT(A)'s contentions, the appellant had filed quarterly E-TDS returns within prescribed deadlines, issued Form 16A to contractors, and uploaded relevant contractor details as required. The ITAT concluded the authorities erred in making the disallowance when statutory compliance had been demonstrated.
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• Section 147 Reassessment Invalid When Initial Notice Issued by Officer Without Jurisdiction Over NRI Taxpayer

  Case-Laws - AT : The ITAT ruled in favor of the non-resident Indian taxpayer, invalidating the reopening of assessment under section 147. The notice under section 148 was initially issued by ITO Ward-3(1), Chandigarh, who lacked jurisdiction over NRI assessees. Subsequently, DCIT, International Taxation assumed jurisdiction based on this invalid notice without issuing a fresh notice. The Tribunal noted that the taxpayer had resided in Afghanistan until returning to India under adverse circumstances, and emphasized that the ITO's unilateral transfer of the case to DCIT, International Taxation could not cure the jurisdictional defect. The proceedings were held bad in law due to the initial issuance by a non-jurisdictional authority.
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• Review Petition Rejected: Unanswered Question on Section 158-BB Clauses Not Grounds for Reconsideration of ITR Ruling

  Case-Laws - HC : The HC rejected the review petition challenging its previous order treating the ITR under Section 139 as "non-est." The Court held that not answering a substantial question regarding the applicability of specific clauses of Section 158-BB did not constitute grounds for review, as this point was left open for the Appellate Tribunal to determine after remand. The Court found no error apparent on the face of the record in its earlier judgment that would justify exercise of review jurisdiction, despite the petitioner's argument about double jeopardy between regular proceedings and block assessment proceedings. The Court distinguished between the scope of review proceedings and statutory appeal, concluding that the effect of its order on subsequent proceedings would be addressed in the connected Income Tax Appeal.
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• Tax Revision Notice Under Section 263 Quashed as Resolution Plan Extinguished All Prior Tax Liabilities

  Case-Laws - HC : The HC quashed a tax revision notice issued under section 263 against a dissolved company. The court held that the approved Resolution Plan had explicitly extinguished all tax liabilities of the Corporate Debtor for periods prior to NCLT approval on 12.10.2023. Relying on Essar and Edelweiss Supreme Court precedents, the court determined that once the Resolution Plan extinguished all tax liabilities, there was no legal basis for authorities to issue revision notices for Assessment Year 2015-16. The petition was allowed and the impugned notice dated 13.01.2025 was set aside as the question of its merits had become academic.
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• Additions Based Solely on Settlement Commission Admissions Improper Without Independent Incriminating Evidence Under s.154

  Case-Laws - AT : The ITAT set aside orders passed by CIT(A) and ACIT under s.154, holding that additions to the assessee's income based solely on admissions made in an application to the Settlement Commission were improper. The Tribunal affirmed that confidential information submitted before the Settlement Commission cannot form the basis for additions in assessment proceedings without independent incriminating material discovered during search and seizure operations. Since the Settlement Commission application was deemed non-maintainable under s.245C(1) and not adjudicated on merits, and the ACIT failed to reference any incriminating material when making the additions, the Tribunal determined the assessment orders were legally unsustainable.
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• Long-Term Capital Gains Exemption Under Section 10(38) Denied for Penny Stock Transactions Deemed Predetermined Scheme for Unaccounted Income (38)

  Case-Laws - AT : ITAT upheld the disallowance of LTCG exemption claimed under section 10(38), determining the transactions constituted a predetermined scheme to introduce unaccounted income. The Tribunal found the assessee's 400% profit in 13 months from penny stock NCL Research was not genuine, noting the suspicious pattern of dormant scrip suddenly appreciating despite poor financial parameters. The synchronized buying and selling, coupled with investigations by Income Tax authorities and SEBI, established the transactions as sham arrangements. The Tribunal emphasized that documentation like contract notes and banking channel evidence alone cannot establish genuineness when market forces don't justify the price increase. The CIT(A)'s findings regarding price manipulation were affirmed.
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• Dividend and Interest Income Additions Deleted for Shares Under Special Court Custody; Business Expenses Allowed

  Case-Laws - AT : The ITAT deleted additions related to dividend and interest income, holding that dividend could not be assessed in the hands of the appellant for unregistered shares, especially considering the shares belonged to a notified person under custody of the Special Court. Additions for unexplained share investments were deleted after considering bonus shares. Interest income additions were also deleted as relevant documents were in possession of the Income Tax Department or Custodian. Various expense disallowances including interest on debenture call money and share trading losses were reversed, with the Tribunal finding that accounting and auditing expenses were incurred for business purposes and therefore allowable. Following its earlier decision in the appellant's case for AY 1991-92, the ITAT directed the AO to allow the entire claim of interest expenditure.
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• Additions Based on Third-Party Statements Invalid Without Cross-Examination; Bonus to Directors Taxed at Maximum Rate Not Disallowable Under Section 36(1)(ii)

  Case-Laws - AT : ITAT ruled that additions based solely on third-party statements without providing cross-examination opportunity to the assessee are invalid. The Tribunal held that genuineness of purchases cannot be doubted merely on transport bill irregularities when proper documentation and banking channel payments exist. Following Vaman International (P.) Ltd., ITAT emphasized that independent inquiry is necessary to establish bogus purchases beyond third-party statements. Regarding bonus payments to directors under Section 36(1)(ii), the Tribunal determined that since directors paid tax at maximum marginal rate on performance bonus received, the transaction was tax-neutral with no revenue loss. As the bonus constituted remuneration for services rendered per contractual obligation, Section 36(1)(ii) disallowance was inapplicable. Appeal dismissed in favor of assessee.
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• Section 54B Deduction Upheld: AO's Assessment Based on Land Revenue Records Prevails Over Satellite Imagery

  Case-Laws - AT : ITAT set aside the Pr. CIT's revisional order under s.263, restoring the AO's reassessment order under s.147 r.w.s.144B. The Tribunal determined that the AO had arrived at a possible and plausible view regarding the taxpayer's eligibility for s.54B deduction after proper verification of agricultural use of the land. The Pr. CIT improperly substituted his own interpretation of ISRO satellite imagery and CCOST reports when the AO had already considered these alongside land revenue records, physical verification reports, and witness statements. The Tribunal held that revenue records evidencing agricultural use should be given precedence over satellite imagery, following Supreme Court precedent.
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• Taxpayer's TDS Credit Claims Remanded for Fresh Review After ITAT Finds Form 26AS Shows All TDS Entries

  Case-Laws - AT : The ITAT set aside the order of the Addl./JCIT(A)-1, Coimbatore and remanded the matter for fresh consideration regarding TDS credit claims. While the Tribunal rejected the appellant's contention that no reasons were provided for disallowing TDS credits (as AO/CPC had specifically identified unmatched TDS from four contractors), it noted that Form 26AS downloaded on June 18, 2020, showed all TDS entries. The ITAT directed the appellate authority to reconsider the matter in light of previous assessment years (2009-10 to 2014-15 and 2016-17) where similar claims were accepted with refunds issued. The appellant was instructed to respond to notices and provide supporting documentation without seeking adjournments. Appeal partly allowed for statistical purposes.
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Customs

• Acrylic Solid Surfaces from China Face Anti-Dumping Duty of USD 0.18 per kg for Five Years Following Material Injury Determination

  Notifications : The Ministry of Finance has imposed anti-dumping duty on 'Acrylic Solid Surfaces' imported from China PR for a period of five years following DGTR's determination that these products were dumped into India, causing material injury to domestic industry. The notification establishes a tiered duty structure: no duty for specified manufacturers (Shandong Kelesi New Material Technology Co., Ltd and Shanghai Sailisi Industry Development Co., Ltd. Shandong Branch), while other Chinese producers face a duty of USD 0.18 per kg. The same duty applies to products originating from any country but exported through China. The duty excludes pure acrylic sheets, acrylic laminates, PET/PVC films, polyester solid surface sheets, and modified acrylic solid surfaces.
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• Preventive Detention Under COFEPOSA Upheld Despite Bail in Criminal Case for Gold Smuggling from Myanmar

  Case-Laws - HC : The HC dismissed a habeas corpus petition challenging detention under COFEPOSA Act for gold smuggling from Myanmar. Despite being granted bail in the criminal case, the petitioner's preventive detention was upheld as legally distinct from punitive measures. The court relied on Ameena Begum (2024) which established parameters for judicial review of preventive detention orders. Following Saraswathi Seshagiri (1982), the court affirmed that past smuggling activities could indicate future conduct warranting preventive detention, particularly in international smuggling cases where standard prosecution might be impractical. The court rejected claims of delayed service, confirming the detention order was properly executed on March 11, 2024, and that all constitutional, statutory, and procedural safeguards were followed.
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• Customs Department Cannot Issue Multiple SCNs After Extended Period Expires for Fabric Classification Under CTH 55151230

  Case-Laws - AT : The CESTAT held that the Department's issuance of multiple SCNs regarding classification of imported fabrics under CTH 55151230 and eligibility for BCD exemption under N/N. 026/2000-Cus was improper. While the Commissioner granted a six-month extension for issuing an SCN, which the Department complied with, they erroneously issued another SCN after the extended period expired. The Tribunal determined that the Department could not treat the Commissioner's Order-in-Original as providing unlimited permission to issue notices beyond the statutorily permitted timeframe. The invocation of extended period of limitation was unjustified as the facts were already known to authorities, and subsequent notices based on identical facts did not constitute suppression. Appeal allowed on limitation grounds.
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• Penalties against financier set aside as knowledge of undervaluation not proven despite voluntary payment of differential duty

  Case-Laws - AT : CESTAT set aside penalties under Section 112(a) of Customs Act against appellant who was characterized as a financier in undervalued imports. The Tribunal found no evidence establishing appellant as the orchestrator of undervalued imports or that he possessed knowledge of improper practices. Though appellant had financed imports and voluntarily paid differential duty of Rs.30 lakh, this alone couldn't establish culpability. The Tribunal noted significant procedural violations including denial of cross-examination of co-accused witnesses and failure to provide essential import documents (Bills of Entry and invoices), constituting violations of natural justice principles. The statements of co-accused lacked evidentiary value without opportunity for cross-examination. Appeal allowed.
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DGFT

• DGFT Removes Walnut Products from Appendix-4J Under Foreign Trade Policy 2023, Easing Export Obligations

  Circulars : DGFT has removed "Walnut in any form" from Appendix-4J of the Handbook of Procedures 2023 by deleting entry Serial No. 13. This amendment was executed under Paragraphs 1.03 and 2.04 of the Foreign Trade Policy 2023. The modification streamlines export obligations for this specific input that previously carried a pre-import condition under Advance Authorizations. The deletion was implemented to facilitate ease of doing business for exporters, effectively eliminating regulatory requirements previously applicable to walnuts under the specified appendix.
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Corporate Law

• Registrar of Companies' Revival of Struck-off Company Deemed Improper for Failing Section 252 Procedural Requirements

  Case-Laws - HC : The HC held that the Registrar of Companies (ROC) failed to follow proper procedure under the second proviso to Section 252 of Companies Act, 2013 for reviving a struck-off company. The provision requires the ROC to file an application before the NCLT within three years from the dissolution order if a company was struck off inadvertently or based on incorrect information. In this case, the ROC neither filed such application nor acted within the three-year period from the January 11, 2016 dissolution order. Consequently, the revival of the company was deemed improper, and the court directed the ROC to strike off the company's name from the Register of Companies and take all necessary legal steps. Petition allowed.
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IBC

• Financial Creditor's Section 7 Application Dismissed: Balance Sheet Signing Date Controls Limitation Period, Not MCA Upload Date

  Case-Laws - AT : The NCLAT dismissed a Section 7 application by a Financial Creditor as time-barred. While acknowledging that balance sheet entries can extend limitation periods under Section 18 of the Limitation Act, the Tribunal held that the relevant balance sheet was signed on 12.08.2020, making the petition filed on 15.01.2024 clearly time-barred. The Tribunal rejected the appellant's contention that limitation should be calculated from the date of uploading the balance sheet on the MCA portal (14.02.2021) rather than its signing date. The NCLAT affirmed that for acknowledgment of debt in a balance sheet to extend limitation, the material date is when the document is signed, as this constitutes the conscious admission of liability required under Section 18, not when it is subsequently uploaded.
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Indian Laws

• Suppression of Material Facts in Response to Demand Notice Invalidates Section 138 NI Act Complaint

  Case-Laws - SC : The SC held that the complaint under Section 138 of the NI Act was invalid due to suppression of material facts by the respondent, a Co-operative Credit Society. The respondent had concealed the appellant's reply dated 28th November 2016 and letter dated 13th December 2016, which requested documents related to an alleged overdraft facility of Rs.11,97,000/-. The respondent falsely claimed the appellant never responded to the demand notice regarding a dishonored cheque for Rs.27,27,460/-. The Court determined that initiating criminal proceedings while suppressing material facts constitutes abuse of process. The JMFC could properly consider this rebuttal to the Section 139 presumption at the process issuance stage. The SC set aside the HC's order and allowed the appeal.
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• Borrower Must Exhaust Statutory Remedies Under SARFAESI Act Before Seeking Writ Jurisdiction Under Article 226

  Case-Laws - HC : The HC dismissed the petition challenging proceedings under SARFAESI Act, upholding the principle that writ jurisdiction should not be invoked when statutory remedies remain available. The Court determined that despite the requirement to deposit funds to file an appeal under Section 18 of SARFAESI Act, this condition alone does not justify bypassing the statutory framework. Following PHR Invent Educational Society v. UCO Bank (2024), the HC affirmed that the SARFAESI Act constitutes a complete code with comprehensive remedies at various stages of proceedings. The Court concluded that Article 226 jurisdiction should be exercised sparingly when efficacious alternative remedies exist within the statutory scheme.
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PMLA

• Provisional Attachment Order Upheld Against Property Purchased with Proceeds of Crime Despite Civil Court Decree

  Case-Laws - AT : The AT upheld the Provisional Attachment Order against property owned by Heera Retail Pvt. Ltd., a group company of the main accused. The appellants' claim based on a civil court decree was rejected as Heera Retail was not party to the civil suit, rendering the decree non-binding on the company. The property had been purchased using proceeds of crime (diverted depositors' funds) prior to the decree. The Tribunal determined that the collusive decree obtained by appellants could not prevail against unchallenged sale deeds executed in favor of the accused's company. The attachment remains valid subject to the Supreme Court's directions regarding realization of investors' dues.
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Service Tax

• Service Tax Refund Denied Without Modified Assessment - Self-Assessed Returns Binding Unless Legally Challenged

  Case-Laws - AT : The CESTAT dismissed the appellant's refund claim for service tax paid on 60% of the value of services rendered under reverse charge mechanism. The Tribunal held that refund proceedings are in the nature of execution proceedings, and refunds cannot be sanctioned without first modifying the assessment, following the Supreme Court's decision in ITC Ltd. The adjudicating authority had determined on merits that the appellant was liable to pay service tax on 50% of the total billing amount. The CESTAT confirmed that a self-assessed return constitutes an assessment which, unless properly challenged and modified through appropriate legal channels, cannot be questioned in refund proceedings, consistent with the ruling in Jagdamba Phosphate.
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• Title: Service Tax Demand on Police Academy Construction Invalid - Not Classifiable as Commercial or Industrial Services

  Case-Laws - AT : CESTAT held that service tax demand on construction activities at police training academy/Tamil Nadu Police Housing Corporation premises is unsustainable. The Tribunal determined these services cannot be classified under "Commercial or Industrial Construction Service" as government institutions not engaged in commerce or industry. Additionally, the attempt to separately classify repair work under "management, maintenance or repair service" was deemed arbitrary since the commercial/industrial construction definition already includes repair and renovation activities. While the extended period for demand was upheld due to the appellant's failure to discharge tax liability, penalties were set aside under Section 80 considering the debatable nature of the demands. The appeal was disposed of accordingly.
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Case Laws:

• GST

• 2025 (3) TMI 1395
  Denial of Input tax credit - expiry of the period prescribed under Sections 37(3) and 39(9) of the Central Goods and Services Tax Act, 2017 - HELD THAT:- It is accepted by the Revenue that there is a clerical/arithmetical mistake which is not being permitted to be corrected. Invariably, such mistakes come to the notice of the seller, who has to fill up the online form(s), etc., after the input tax credit is denied to the purchaser(s). Re-list in the week commencing 28.04.2025.

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• 2025 (3) TMI 1394
  Seeking cancellation of the bail granted to the appellant - respondent/Union of India submitted that the case of the Gautam Garg cannot be equated with the present case as the present appellant is the main accused and proprietor of the two firms and an operator in another firm - HELD THAT:- The case for bail is made out. Appeal allowed.

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• 2025 (3) TMI 1393
  Challenge to order of provisional attachment of bank account of the petitioner - HELD THAT:- The final order passed under Section 74 of the CGST Act, if ultimately challenged shall be looked into on its own merits in accordance with law without being influenced in any manner by any of the observations made by the High Court in its impugned order. This Court in M/s Radha Krishan Industries versus State of Himachal Pradesh Ors., [ 2021 (4) TMI 837 - SUPREME COURT] , has categorically said that once the final order is passed under Section 74 of the CGST Act, the provisional attachment comes to an end. SLP disposed off.

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• 2025 (3) TMI 1392
  Challenge to ex-parte demand order and SCN - Time limitation - HELD THAT:- This subject matter is covered by the judgment and order in M/s Anita Traders Lko. U.P. Thru Proprietor Aneeta Sharma vs. State of U.P. and another [ 2025 (2) TMI 466 - ALLAHABAD HIGH COURT] where it was held that As would be apparent from a reading of the said order, the due date for filing annual return in the case of financial year 2017-18 was 31.12.2018, however, this due date was extended by the Central Board of Direct Taxes and Customs vide notification dated 03.02.2018, to 05.02.2020 and this notification was adopted by the State of U.P. vide notification dated 05.02.2020. Based on this notification, the period of three years mentioned in Sub Section 10 of Section 73 would end on 05.02.2023 meaning thereby, an order under Sub Section 9 of Section 73 for the financial year 2017-18 could have been passed by 05.02.2023 but not after it. It has been held in the said judgment that an order under sub-Section 9 of Section 73 pertaining to financial year 2017-18 could have been passed by 05.02.2023 but not thereafter. The notification dated 24.04.2023 has been considered and the contention that such an order could have been passed til 31.03.2023 has been repelled for the reasons given therein. Now, in the case at hand the order under sub-Section 9 of Section 73 has been passed on 14.12.2023, therefore, it is clearly time barred. Conclusion - The impugned orders are beyond the time limit prescribed under sub Section 10 of Section 73 as applicable for the financial year 2017-18 and therefore the impugned orders are beyond jurisdiction being barred by the time provided in the said provision. Petition allowed.

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• 2025 (3) TMI 1391
  Violation of principles of natural justice - Challenge to assessment order and the consequent rectification order passed by the respondent - petitioner s consultant failed to file an appeal, within the limitation period - HELD THAT:- In the present case, initially ASMT 10 notice dated 04.01.2022 was issued to the petitioner for which the petitioner submitted its reply on 07.04.2022. Thereafter, for the very same issue and assessment year another ASMT 10 notice was issued on 09.10.2023. Thereafter pre show cause notice dated 11.12.2023 followed by show cause notice dated 16.12.2023 was issued to the petitioner, for which the petitioner vide reply dated 16.01.2024 and 28.02.2024 sought for adjournment for filing detailed reply along with supporting documents and also personal hearing. But, the respondent herein without considering the same has passed the impugned assessment order. As rightly contended by the learned counsel for the petitioner when the respondent intend to drop the proceedings, based on the reply filed by the petitioner to the show cause notice, they can very well do so. But, when they intend to pass orders confirming the demand for the other issue, they ought to have provided an opportunity of hearing to the petitioner. In the case on hand, the impugned order came to be passed without sufficient opportunities to the petitioner. Hence, this Court is of the view that the impugned order passed is in violation of principles of natural justice and it is just and necessary to provide an opportunity to the petitioner to establish their case on merits. In such view of the matter, this Court is inclined to set aside the impugned assessment order as well as the rectification order passed by the respondent. The orders impugned herein are set aside and the matter is remitted back to the assessing authority for fresh consideration - Petition allowed by way of remand.

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• 2025 (3) TMI 1390
  Seeking grant of anticipatory bail - involvement in financial misconduct and the subsequent impact on the State Exchequer - HELD THAT:- Considering the fact that the petitioner has not caused any loss to the State Exchequer as he has been filing GST returns on time, with the purchases made by him and his firm accurately reflected in the vendor s GST R-1 Return, as well as in the GST 2-A and 3-B returns and all due taxes have been paid promptly and the fact that the petitioner is ready and willing to join the investigation and cooperate with the investigating officer concerned, as has been averred in para No.16 of the present petition, this Court is of the considered view that the petitioner deserves the concession of anticipatory bail at this stage. The petitioner is directed to be released on anticipatory bail subject to fulfilment of conditions imposed - bail application allowed.

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• 2025 (3) TMI 1389
  Cancellation of registration of petitioner - petitioner Municipal Board did not file returns for a continuous period of six months - HELD THAT:- In view of the fact that the petitioner Municipal Board after 13.05.2022 has cleared all its dues under the GST Act and since then, has been depositing its dues under the GST Act regularly/monthly, the impugned order dated 17.10.2019 is set aside by making the interim order dated 13.05.2022, as suggested by Mr. Keyal, learned Standing Counsel, CGST, absolute. Petition allowed.

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• 2025 (3) TMI 1388
  Dismissal of appeal on the ground of delay of 285 days in filing appeal - sufficient cause for delay or not - HELD THAT:- Considering the fact that the notices were uploaded in the portal, but no hard copy was served on the petitioner, this Court feels that reasonable cause has been shown by the petitioner for the delay. Therefore, this Court is inclined to condone the delay of 285 days in filing the appeal. The delay of 285 days in filing the appeal before the first respondent is condoned and the order of the appellate authority/first respondent is set aside - Petition allowed.

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• Income Tax

• 2025 (3) TMI 1387
  ITR u/s 139 to be treated as non-est or not - Review of order [ 2014 (5) TMI 596 - ALLAHABAD HIGH COURT] - HELD THAT:- In the facts of the case, it has to be seen as to when the due date for filing return i.e. 31.10.2002 had lapsed but, prior thereto, account books and other material of the assessee were seized on 01.09.2002 and when the block assessment was being done, whether it was at all necessary for the assessee to file a belated return after the seized material was released in favour of the assessee or if at all it was filed, whether such filing could be fatal to his case or whether the assessee was precluded from filing return though inspection was facilitated to him. The interse connection between regular proceedings vis-a-vis block assessment proceedings in the peculiar facts of the case, is a question that has relevance so as to adjudge the issue of double jeopardy allegedly faced by the assessee, as argued on his behalf. Review petition - non answering the substantial question - whether a ground for review? - HELD THAT:- Applicability of correct clause/sub-clause of any Section/sub-Section of Section 158-BB of the IT Act was not answered by this Court while deciding the appeal, the same, in itself, cannot be a ground to review the order, inasmuch as, the point was left open by the Court to be decided in appeal after remand, i.e. to say that the ingredients of the substantial question of law were to be re-determined by the Appellate Tribunal pursuant to the order of remand. Therefore, when Shri Goyal submits that the Appellate Tribunal, after remand, has accepted the finding of this Court as regards the ITR under Section 139 being non-est and, therefore, the order passed by the Tribunal be also set aside on this ground alone, we are of the view that the present review application and the connected appeal are to be decided in the light of scope of two different and independent proceedings, i.e. one being an application for review and the other being a statutory appeal and, hence, we would do accordingly. Conclusion - We find that not only the block assessment order dated 30.09.2004 but also the assessment order 29.03.2006 and orders passed subsequently i.e. on 16.08.2005 and 26.06.2006 contained discussion of material that was available before the Authorities/Tribunal. Merely because this Court interpreted the record of proceedings in one way or the other, we do not find that there is any error apparent on the face of the record so as to justify exercise of our review jurisdiction. At the same time, the effect of order on the proceedings culminating into passing of the subsequent order after remand, has to be seen while deciding the connected Income Tax Appeal [ 2025 (3) TMI 1287 - ALLAHABAD HIGH COURT ] but, in any case, we are of the considered view that the order [ 2014 (5) TMI 596 - ALLAHABAD HIGH COURT ] does not suffer from an error apparent on the face of the record so as to persuade this Court to review the order and take another view of the matter different from the one taken by this Court in its order dated 16.05.2014. Application for review stands rejected.

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• 2025 (3) TMI 1386
  Interim Application seeks restoration of Writ Petition which was dismissed for non- prosecution - This application has been filed after delay of 16 months and 9 days, so condonation is applied for. Respondent/Revenue states that the delay is, in fact, 19 months, not just 16 months and 9 days. HELD THAT:- In such matters, the length of the delay is one consideration, but the cost shown is crucial. If the cost shown is satisfactory, then, subject no doubt to payment of sufficient cost, the delay can be condoned. In Paragraphs 6 and 7, the Applicant has explained the circumstances in which the matter was missed and no sufficient steps were taken. An apology is also being tendered. There is nothing on record to suggest any lack of bonafide. Therefore, considering the cost shown, the delay can be condoned, and the Petition can be restored. By a separate order, we have restored this Petition which was earlier dismissed for non-prosecution - This Petition challenges the assessment order dated 25 March 2022 - Applicant seeks leave to withdraw this Petition with the liberty to file an Appeal against the impugned order - HELD THAT:- This Petition was instituted on 26 April 2022, i.e. within the limitation period prescribed for instituting an Appeal. This Court had also granted interim protection to the Petitioner. The Petition was being pursued bona fide. Therefore, if, as stated Petitioner that the Appeal is instituted within four weeks from today, then the Appellate Authority should give due consideration to the fact that this Petition was instituted on 26 April 2022 and has been pending in this Court until today. The Petitioner was bona fide in pursuing this Petition because it alleged certain breaches of principles of natural justice. Accordingly, leave is granted, and this Petition is disposed of as withdrawn with liberty to the Petitioner to pursue the Appeal remedy.

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• 2025 (3) TMI 1385
  Assessment of trust - Petitioner s application for condonation of delay in filing Form-10 rejected - HELD THAT:- The record shows that the Petitioner is a small charitable trust engaged inter-alia in awarding scholarships for educational purposes. The returns were filed for AY 2021-2022 during the extended period due to the COVID-19 pandemic. This means that the COVID-19 pandemic had just ended, and during this pandemic, it must have been challenging for Petitioner-Trust to have its documentation in order. The record also shows that the Petitioner has been diligent and punctual in filing the necessary Form-10 along with its returns for the previous years. Petitioner, in its application for condonation of delay, has relied upon a precedent, thereby suggesting that the circumstances referred to in the precedent were not qualitatively different from those in the Petitioner s case. There are no mala fides involved, and it is not as if the Petitioner has gained any undue advantage on account of the delay in submitting Form-10. In this case, the return was filed within the prescribed period, but Form-10 did not accompany it. After this lacuna was pointed out, the same was rectified, but with some delay. From the Application for condonation of delay, it appears that the Petitioner did not have any professional assistance. This position was affirmed by Mr. Jain, learned counsel for the Petitioner. Thus, we think sufficient cause has been shown for the condonation of delay.

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• 2025 (3) TMI 1384
  Revision proceedings against company dissolved - Resolution Plan provided for the waiver and extinguishment of all the unassessed/assessed tax liabilities for the period prior to the NCLT approval date - HELD THAT:- As relying on case laws Essar 2019 (11) TMI 731 - SUPREME COURT ]and Edelweiss [ 2021 (4) TMI 613 - SUPREME COURT ] it is clear that on the complete extinguishment of all tax liabilities of the Corporate Debtor upon the approval of the Resolution Plan on 12.10.2023, there could be no occasion whatsoever for the respondents to issue the impugned notice un/s 263 seeking to revise the Assessment Order for the Assessment Year 2015-16. Thus, the merits of the impugned notice u/s 263 have become academic and need not be ventured into by this Court. Resultantly, the petition succeeds and the impugned notice dated 13.01.2025 u/s 263 of the Act is hereby quashed and set aside.

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• 2025 (3) TMI 1383
  Validity of penalty order given that the show-cause notice fixed a later date for appearance - HELD THAT:- As we are inclined to grant indulgence in the matter inasmuch as the Notice dated 24th October, 2019 issued under Section 274 r/w Section 271(1)(c) of the Income Tax Act apparently had fixed date 08th November, 2019 for showing the cause as to why penalty proceedings should not be taken up under Section 271(1)(c). A perusal of the penalty order that was impugned before the Tribunal would show that it was made on 24th October, 2019, i.e. the day on which the show-cause notice was issued fixing 08th November, 2019 as a date of hearing. Thus, there is a gross violation of principles of natural justice that would warrant invalidation of the penalty order and the order of the Income-tax Appellate Tribunal affirming it, by answering the subject substantial question of law, in favour of the Assessee. This appeal succeeds. Penalty Order and the Income-Tax Appellate Tribunal s Order which has confirmed it, are set aside.

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• 2025 (3) TMI 1382
  Assessment u/s 153C - Addition u/s 68 - Addition in the absence of incriminating material found during the search - HELD THAT:-We find that in this case addition has been made on account of share application and unsecured loan interest relating to purchase of property. All these items were duly disclosed by the assessee in the balance sheet, hence, the submission of the assessee is correct as no seized material was found on the basis of which the addition has been made. In this regard, we rely upon the decision of the Apex Court in the case of CIT vs. Abhisar Buildwell Pvt. Ltd. [ 2023 (4) TMI 1056 - SUPREME COURT] wherein, as expounded that for assessment u/s.153A incriminating material is a sine quo non and in the absence of incriminating material as referred, the assessment is bad in law. Decided in favour of assessee.

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• 2025 (3) TMI 1381
  TP Adjustment - addition in ITeS Segment and SDS Segment - incorrect computation of working capital adjusted margins by the TPO by alleging that the DRP via directions has agreed to the Appellant s contentions and directed TPO to follow the guidelines provided by OECD for the computation of working capital adjusted margin - HELD THAT:- TPO has fallen in error in giving effect to the DRP directions in correct perspective and rather committing a mechanical error, the issue needs to be rested to ld. TPO, for removing the error and further give an opportunity of hearing to the assessee to show as to how after giving effect to the DRP orders the margin of computation of comparables in both segment shall fall within the range. In aforesaid terms the ground no. 2.5 is decided in favour of assessee. Comparable selection - Magnasoft Consulting India Pvt. Ltd. and Aptus Software Labs Pvt. Ltd. - As we sustain the contention of assessee that these two comparables needs to be removed and accordingly ALP be determined. Thus these grounds are allowed partly infavour of the assessee. Deduction claim u/s 80G - We are of considered view that ld. Tax authorities below have fallen in error to deny benefit of Section 80G to the assessee. The ground is sustained.

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• 2025 (3) TMI 1380
  Unexplained credit u/s 68 - loan procurement - HELD THAT:- Additions u/s 68 cannot be made merely on the basis of some perception of culpability towards receipt of loan. The money in the instant case has been received from a company whose financial standing has been demonstrated to be fairly good. The defining feature in the instant case is repayment of such loan in the subsequent years which distinguishes the facts of this case vis-a-vis the facts involved in NRI Steel and other judgements quoted by the Revenue authorities. The factum of repayment quells the apprehension entertained by the Revenue. The over-riding factum of repayment of loan itself repels any form of disguise on the part of the assessee and dispels the perception of any sordid or extraneous affairs. The clinching evidences towards loan procurement discharge the primary onus which lay upon the assessee u/s 68 of the Act. Besides, the loan itself having been repaid, the assessee does not ultimately stand to gain any spurious benefit from such alleged unexplained cash credit. Such fact justifies the plea of the assessee towards existence of bonafides in the transactions. In the totality of facts, where the trail for obtaining of loan and repayment thereof is proved and the lender has duly filed its return of income encompassing the transaction carried with the assessee, the action of the Revenue cannot be countenanced in law. In the wake of peculiar facts subsisting in the present case, the additions towards unexplained credit u/s 68 and estimated addition u/s 69C is wholly unjustified. As in the cases of CIT Vs. Ayachi Chandrasekhar Narsangji [ 2013 (12) TMI 372 - GUJARAT HIGH COURT] and CIT Vs. Mahavir Crimpers [ 2018 (6) TMI 1058 - GUJARAT HIGH COURT] have held that when the Department has accepted the factum of repayment, the additions under Section 68 is not sustainable in law. Similar view has been expressed in CIT Vs. Karaj Singh [ 2011 (3) TMI 951 - PUNJAB AND HARYANA HIGH COURT] Panna Devi Chowdhary [ 1994 (3) TMI 80 - BOMBAY HIGH COURT] . Decided in favour of the assesse.

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• 2025 (3) TMI 1379
  Assessment order passed u/s 143(3) the name of non existent assessee - applicability of Section 170(2) of the Income Tax Act concerning assessments on successor entities - HELD THAT:- We have no hesitation to hold that the assessment in the instant case has been framed on a non-existing entity (UBI). Revenue was time and again informed of the amalgamation which was acknowledged in assessment proceedings for AY 2012-13 but completely ignored in assessment proceedings for AY 2018-19. As held by Maruti Suzuki [ 2017 (9) TMI 387 - DELHI HIGH COURT] that an assessment made on an entity that has ceased to exist, is substantive illegality and not a procedural violation of nature adverted to in section 292B of the Income Tax Act . Therefore, we are of the considered view that the assessment order for AY 2018-19 on United Bank of India is void ab initio and has to be quashed. We order accordingly and set aside the findings of the CIT(A) by quashing the assessment order. Decided in favour of assessee.

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• 2025 (3) TMI 1378
  Income from the provision of background scrutiny screening services as assessable under the head royalty - India-UK DTAA - HELD THAT:- Both the learned lower authorities respective findings assessing the assessee s impugned income from the provision of background scrutiny screening services as assessable under the head royalty , stands reversed in very terms therefore. Assessee appeal allowed.

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• 2025 (3) TMI 1377
  Rectification proceedings u/s 154 - rectify the assessment order by disallowing the credit of Tax Deducted at Source (TDS) claimed - HELD THAT:- On identical facts, in the case of Sri A.M. Fazil vs DCIT, Circle-1, Alappuzha [ 2019 (3) TMI 992 - ITAT COCHIN] held that withdrawal of tax credit which was given in the assessment completed u/s 143(3) by resorting rectification proceedings u/s 154 is legally untenable and cannot be sustained. We hold that the addition by the AO is not a mistake apparent from the record in the given facts of the case and therefore the same is deleted. However, we make it clear that TDS which is given due credit in this assessment year, the same should not be given credit during any other assessment year when income is/was offered for taxation. It is ordered accordingly. Appeal of the assessee is allowed.

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• 2025 (3) TMI 1376
  Rectification of mistake u/s 154 - additions to the assessee s income based solely on the admissions made in an application to the Settlement Commission - HELD THAT:- ACIT did not refer to any incriminating material for the purpose of passing of the said orders. In the cited decision by the Coordinate Bench of ITAT, Jaipur Bench [ 2019 (8) TMI 990 - ITAT JAIPUR] ] reliance was placed on decision in the case of Anantanadh Construction Farms Pvt. Ltd. [ 2017 (5) TMI 1692 - ITAT MUMBAI ] wherein it was held that confidential information submitted before the Settlement Commission cannot be the basis of addition in the assessment proceedings in absence of any incriminating material found during the course of search and seizure action. Admittedly, the application submitted before Settlement Commission was not adjudicated on merits, and rather, the same was found to be not maintainable as the same did not fulfill conditions laid down u/s 245C(1) of the Act. In the given facts and circumstances of the case we are in agreement with the contention raised by Ld. AR for the appellant that the ACIT erred in making addition simply on the basis of admission made by the assessee in her application submitted before Settlement Commission, without referring or taking into consideration or discussing any incriminating material therein. The impugned orders passed by the Learned CIT(A) and the impugned orders u/s 154 of the Act passed by the ACIT deserve to be set aside.

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• 2025 (3) TMI 1375
  Unexplained Cash Credit u/s. 68 - Bogus LTCG - AO disallowed the same on the ground that the assessee had introduced unaccounted income under the guise of bogus/sham LTCG claim u/s 10(38) - HELD THAT:- Buying and selling of shares in a concerted way shows a direct connivance between operators and the assessee and proves the entire process is predetermined and synchronized. The company s financials, profit, dividend, earning per share etc. if not sole basis for increase in share price but at least is a paramount fact and in the instant case it is clear that all the criteria has given a go-away. No hesitation to say the scrawny financial parameters cannot command such a high rise of shares in such a small period. Mysterious are ways. In enigmatic ride the assessee has made 400% profit in a span of fat 13 months. This coupled with the investigation conducted by the Income Tax Department with the backing of the statements of the brokers, it can be said that the assessee cannot claim ignorance of the unfair trade practices took place in the Security Market with respect to this scrip. Submitting that the assessee is a passive beneficiary of the operation cannot absolve the accountability of the assessee to claim LTCG as exempt. The said scrip has been in dormant and suddenly sprouted to yield profits of the highest order and then went into oblivion. Further, coupled with the inquires conducted by the SEBI with regard to the scrip do not instil any confidence about the genuineness of the earning of long-term capital gains. Hence, we have no hesitation to hold that NCL Research scrip was a penny stock and used by the assessee to book LTCG. The transactions being ungenuine, this will disentitle the assessee the claim of exemption u/s 10(38). The production of contract notes, bills, invoices, payment of STT, banking channel evidences per se does not explain and demonstrate genuineness of the share transactions unless and until assessee prima-facie shows to the authorities particularly so when LTCG is claimed in return that rise in prices of scrip was a usual market phenomenon which was driven by market force. In the case of Sanat Kumar [ 2019 (8) TMI 696 - ITAT DELHI] has held that the so-called sale proceeds of shares received and claimed as exempt u/s. 10(38) was held to be sham transaction because of huge price rise of shares at the time of sale despite the fact that company s profits are negligible and did not support such price rise In the case of Somnath Maini [ 2006 (11) TMI 189 - PUNJAB AND HARYANA HIGH COURT] held that claim of genuineness of transactions can be rejected even if the assessee backs the same with evidence which is not trustworthy. Co-ordinate Bench of ITAT Chennai in the case of Rajnish Agarwal [ 2019 (1) TMI 1216 - ITAT CHENNAI] as held that the penny stock not having any financial strength of its own and the sale and purchase of these shares were held to be sham and LTCG u/s. 10(38) was denied to the assessee. We, therefore, hold that the facts and circumstances of the present case are very tightly knit case where the Revenue has gone behind the transaction of capital gains to know the factual operation of sudden volatility in the prices of the scrip. The present case is therefore required to be adjudicated on the given set of facts and evidence. As rightly observed by the CIT(A) in his order, it is relevant to note that price maneuvering occurred in assessee s case as confirmed by the DGIT, SEBI, statements of the involved persons recorded. In view of the above, we find that the assessee s transactions are not genuine and therefore we affirm the well-reasoned order of the Ld. CIT(A). Decided against assessee.

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• 2025 (3) TMI 1374
  Invalid approval granted u/s 153D - HELD THAT:- In the present case, the approval dated 29/12/2016 of the JCIT has been received by the ACIT only on 30/12/2016 and the Assessment Orders have been passed on 29/12/2016. Thus, as on date of passing of the Assessment Order, the approval u/s 153D of the Act has not been received by the A.O., therefore, the assessment order has been passed by the A.O. in the absence of receipt of the approval u/s 153D of the Act. While granting the Approval the Ld. JCIT only mentioned that the Draft Assessment Order has been approved, which doesn t prove the applications of mind by the Ld. JCIT. JCIT accorded the consolidated single approval u/s 153D of the Act for several Assessment Years. Therefore, the ratio laid down by the Hon ble High Court of Delhi in the case of Shiv Kumar Nayyar [ 2024 (6) TMI 29 - DELHI HIGH COURT ] is squarely applicable to the captioned Appeals. Thus, the impugned assessment orders deserves to be set aside. We allow the Additional Ground of Appeal challenging the assessment order which was framed based on an invalid approval accorded u/s 153D. Decided in favour of assessee.

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• 2025 (3) TMI 1373
  Additions u/s 68 - unexplained credits in the bank account of the Assessees, based on the seized software Hajir Johri - HELD THAT:- The cheques issued by Jidnal Bullion Ltd. against the purchase of jewellery from the Assessee s have been made as basis for initiating the proceedings against the respective Assessee. As per the seized material referred by the AO, no name mentioned with regard to receipt of the cash. It is the contention of Assessee s Representative that there is no link between alleged cash receipt mentioned in the seized document and the Assessee s. Further in the statement of Mr. Parul Ahluwalia and Ekta Soni, no name of the Assessee s have been stated. The said fact of selling of jewellery have been duly found recorded in the books of account of Jindal Bullion Ltd. which has been accepted as it is and the fact of receipt of the cash is not forth coming in the documents relied by the A.O. or by the Ld. CIT(A). By respectfully following the orders of the Tribunal in the case of Smt. Nirmal Uppal [ 2023 (5) TMI 1431 - ITAT DELHI] and M/s Sanmati Jewellers [ 2025 (3) TMI 216 - ITAT DELHI ] we delete the respective additions made in the hand of the Assessee s relying on Hazir Johri Software. Decided in favour of assessee.

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• 2025 (3) TMI 1372
  Unexplained cash credit u/s 68 - assessee has submitted that no benefit of long-term capital gains exemption u/s 10(38) has been claimed in respect of the profit derived from the alleged shares - also there is no evidence on record to establish that the assessee was involved in price rigging - HELD THAT:- We respectfully rely on the decision of Aadesh Commodities Pvt. Ltd [ 2024 (8) TMI 1539 - ITAT MUMBAI] as held that if the sale transactions are treated as bogus, they must be removed from the Profit Loss Account turnover, which would consequently result in a loss. Such a loss would then be adjustable against the addition made u/s 68 of the Act, rendering the entire exercise tax neutral. Furthermore, once the assessee has duly disclosed the amount in the Profit Loss Account, it cannot be subjected to double taxation. In view of the foregoing, we find that the impugned appellate order is well-reasoned and does not warrant any interference. Accordingly, the grounds raised by the revenue are dismissed.

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• 2025 (3) TMI 1371
  Additions on Dividend and Interest Income - CIT(A) and the AO have estimated the gross dividend and interest on debentures by making comparison with the group entities - HELD THAT:- There is no denying of the fact that the dividend is received only by the registered shareholders. Assessee may have purchased shares and the shares must be lying for registration with the companies and, therefore, there is no question of receiving any dividend on any unregistered shares. It is an admitted fact that Harshad Mehta group was notified person and, therefore, the shares belong to a notified person and were in the custody of the Special Court. It is also a fact that some of the shares had not been received by the notified party. We are of the considered view that such dividend in the hands of the owner of shares which were not registered in the name of the assessee could not be assessed as income in the hands of the assessee. We direct the AO to delete the additions on account of dividend and interest. In fact, most of the debentures were convertible debentures and have been converted into shares, therefore, there is no question of estimating any interest on the same. Accordingly, Ground No. 2 is allowed. Purchase of shares as unexplained investment - As assessee reiterated that the shares received on bonus have not been considered in the increase in the holding of shares. The details have been furnished. Considering the bonus shares, in the impugned shares, we do not find any merit in the additions sustained by the ld. CIT(A) and the same is hereby directed to be deleted. Accordingly, Ground No. 3 is allowed. Addition of interest income - HELD THAT:- We are of the considered view that since all the documents including bank statements of the assessee were in possession of either of the Income-tax Department or the Custodian, it would be a futile exercise to expect the assessee to furnish evidence and since no evidence has been brought on record by the revenue, the addition is directed to be deleted. Ground No. 5, is allowed. Disallowance of various expenses recorded in the books of accounts - assessee has claimed various expenditure including interest on share debenture call money, loss of shares and other expenses - HELD THAT:- We find that on conversion of debentures, the assessee received shares on which it received dividends. Therefore, any difference in the claim of interest expenses qua the interest received on debentures is due to the conversion of debentures into shares. Therefore, the basis on which the interest has been disallowed itself is faulty. Therefore, the addition to the extent of Rs. 16,16,148/- cannot be sustained. Share trading loss - The assessee has furnished copies of the contract notes of purchase of shares which are placed on record. Considering the same, the share trading loss cannot be disallowed and insofar as the other expenses are concerned, which are mainly related to the accounting and auditing expenses, were incurred for the purpose of business and the same deserve to be allowed. Considering the totality of facts we do not find any merit in the addition and the same is directed to be deleted. Disallowance of interest expenditure - HELD THAT:- In assessee s own case for AY 1991-92, the Coordinate Bench has allowed the claim of interest. On finding parity of facts, respectfully following the decision (supra), we direct the AO to allow the entire claim of interest.

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• 2025 (3) TMI 1370
  TP adjustments - Since the assessee had international transactions with Associated Enterprises (AEs), a reference was made to the TPO u/s 92CA - HELD THAT:- It is evident that the CIT(A)-NFAC has dismissed the appeal without rendering any findings on the merits of the case, which is against the principles of natural justice. Since the core issue in the appeal pertains to Transfer Pricing adjustments, the appeal ought to have been adjudicated by CIT(A)-TP as submitted by the DR. The failure of CIT(A)-NFAC to decide the issues on merits has resulted in an improper disposal of the appeal, necessitating a remand. Considering the fair concession made by the DR, we are of the opinion that the matter should be restored to the file of the CIT(A)-TP or CIT(A) of any other appropriate charge for fresh adjudication. The concerned CIT(A) is directed to examine all the grounds of appeal raised by the assessee and adjudicate the issues on merits after granting a reasonable opportunity of being heard to the assessee. Appeal of the assessee is allowed for statistical purposes.

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• 2025 (3) TMI 1369
  Bogus purchases - Shri Shailabh Khandelwal/third party in his statement recorded u/s 131 has admitted that the above company provide accommodation entries on commission basis - HELD THAT:- In the present case, the AO made additions towards purchases, merely, on the basis of statement of third party i.e. Shri Shailabh Khandelwal, without providing his statement to the assessee for its rebuttal and also cross examination contrary to the settled principle of law. Therefore, in our considered view, unless the statement is given to the assessee, no additions can be made on the basis of third party statement. Purchases made by the assessee from M/s Jagannatha Agro Ltd . - As based on few instances of irregularity in transport bills, genuineness of purchases cannot be doubted, when the assessee has furnished every bill for purchases and payment made through proper banking channel. Therefore, we are of the considered view, that the AO erred in making additions towards purchases from M/s Jagannath Agro Ltd. as bogus in nature, without conducting further enquiry and also without bringing further material on record to establish that the payment made against purchases was received back in cash by the assessee. This principle is supported by the decision of Vaman International (P.) Ltd. [ 2020 (2) TMI 464 - BOMBAY HIGH COURT] wherein, on similar facts, the Hon ble High Court held that, the AO solely relying on the statement of a third party made addition on account of bogus purchases, without any inquiry made by him to bring on record any evidence to prove his allegation of bogus purchases. As genuineness of purchases cannot be doubted only on the basis of third party statements, unless independent enquiry is conducted to ascertain true nature of transactions, in light of various evidences filed by the assessee. In the present case, since the assessee has filed various evidences to prove the genuineness of the purchases, in our considered view, the AO is erred in making addition only on the basis of statement of third party. Decided in favour of assessee. Treatment to payment as bonus - assessee company had made bonus payment to the Directors and claimed deduction u/s 36(1)(ii) - although the assessee contends that payment of bonus to the Directors is for the services rendered, but the fact remains that the payment is distribution of dividend, which falls under the provisions of 36(1)(ii), therefore, disallowed the bonus payment - HELD THAT:- If we go by the rate of tax payable by the appellant company on this income and the rate of taxes paid by the directors on their total income, there is no difference in taxes paid by the Directors on the performance bonus paid by the appellant company. Had the company has not paid bonus to the employees and paid taxes on its own as its profits, the assessee would have paid 30% tax on such bonus payment. Since the Directors have paid maximum marginal rate of tax on their income, which includes performance bonus received by the appellant company, in our considered view, when there is no loss of taxes, it can at best be said that it is tax neutral and there is no loss of revenue to the Government. Therefore, once the assessee has proved the payment of bonus to the directors as part of remuneration in terms of contractual obligation between the parties and further, there is no loss of revenue, in our considered view, the AO cannot bring the said payment within the provisions of section 36(1)(ii). In our considered view, the provisions of section 36(1)(ii) will come into play, where assessee makes payment to any employee, as bonus or commission for services rendered, where such sum would not have been payable to him as profit or dividend, if it had not been paid as bonus or commission. Since the assessee has paid performance bonus for the services rendered to the Directors, in our considered view, the provisions of section 36(1)(ii) cannot be pressed into service. CIT(A), after considering the relevant facts has rightly directed the AO to delete the additions made towards performance bonus. Thus, we are inclined to uphold the findings of the CIT(A) and dismiss the appeal filed by the Revenue.

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• 2025 (3) TMI 1368
  Rejecting the application for final registration u/s 12AB and cancelling the provisional registration granted u/s 12A(1)(ac)(vi) - HELD THAT:- In the present case, the assessee was granted provisional registration on 27.10.2021, and it was required to file Form 10AB by 26.04.2024 (six months before expiry). The application was filed late on 29.06.2024. While the delay is not substantial, the failure to respond to notices issued by the CIT(E) contributed to the rejection of registration. The submissions of both parties and examined the records. It is evident that the assessee filed Form 10AB late, beyond the prescribed due date. CIT(E) issued two notices, which remained unanswered by the assessee. CIT(E), however, did not discuss or examine the documents already submitted by the assessee along with Form 10AB. DR did not object to remanding the matter back to the CIT(E) for fresh consideration. As per the provisions of Section 12A(1)(ac) of the Act, the correct form for final registration after obtaining provisional registration under Section 12A(1)(ac)(vi) is Form 10AB, and not Form 10A. The assessee had already been granted provisional registration, and therefore, Form 10AB was the appropriate form to be filed for final registration. The contention of the AR that Form 10A should have been filed is misplaced and does not hold merit. We also note that the CIT(E) has committed a procedural lapse by not addressing the evidence that was already on record before rejecting the application. The mere non-response to notices cannot be the sole basis for rejection if relevant documents were available in the assessment file. A fair assessment would require an evaluation of all materials submitted before reaching an adverse conclusion. The assessee s failure to respond to notices caused unnecessary delays in the proceedings. Non-cooperation with the regulatory authority is not a practice that can be condoned without consequences. To balance the equities, we find it just and appropriate to impose a cost of Rs.10,000/- on the assessee for its non-responsiveness, while setting aside the order of the CIT(E). We set aside the order of the CIT(E) and restore the matter back to the CIT(E) for fresh consideration. Assessee is allowed for statistical purposes.

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• 2025 (3) TMI 1367
  TP Adjustment - TPO determining the Transfer Pricing taking another suitable methodology with cogent reason - HELD THAT:-The assessee has established 4 power plants as mentioned for captive power supplies to its cement unit at Nimbahera. These units are eligible for deduction u/s. 80IA of the Act, whereas the cement plant was not eligible for the same. Total electricity generation of these power plants are being used in assessee s cement plant only and there is no outside sale of the electricity. The assessee adopted Comparable Uncontrolled Price (CUP) method, based on the average price charged by the AVVNL to the cement plant, i.e. Rs. 7.40 per unit. Whereas the TPO, benchmarked the transaction based on the supplies made by the Sasan Power Ltd., Shree Cement Ltd., Coastal Gujarat Tata/ NTPC/ PTC and Reliance etc. As decided in M/s. Jindal Steel and Power Ltd. [ 2023 (12) TMI 417 - SUPREME COURT] as held Tribunal had rightly computed the market value of electricity supplied by the captive power plants of the assessee to its industrial units after comparing it with the rate of power available in the open market i.e., the price charged by the State Electricity Board while supplying electricity to the industrial consumers. Therefore, the High Court was fully justified in deciding the appeal against the revenue. Determination of price of electricity is a regulated activity and therefore the price at which power is supplied by generation company to transmission or distribution company cannot be said to be under uncontrolled condition to be considered for benchmarking purpose. The activities of generation, transmission and distribution of electricity is a regulated activity in India with the primary legislation being The Electricity Act, 2003, under terms of which Central Electricity Regulation Commission ( CERC ) and State Electricity Regulation Commission ( SERC ) for various states have been established. A price which is applied or proposed to be applied in a transaction between persons other than associated enterprises in uncontrolled conditions, it is evident that the transaction of purchase of electricity by State Electricity Boards from independent power producers is a regulated activity, being subject to approval of SERC, and therefore is not a transaction undertaken in uncontrolled conditions. Thus, the transaction between power producers and state electricity board is not fit to be considered comparable to the tested transaction of sale of electricity by eligible unit to non- eligible unit. Thus, the average rate of Rs 4.57 per unit, being the price for transfer of electricity by power producers to third party customers cannot be treated as arm s length price as it is a price under controlled conditions. Decisions in favour of the Appellant supporting the ALP determination made by the Appellant. Thus, we are of the considered opinion that the transfer price of electricity considered by the Appellant is ALP and therefore the additions proposed by the TPO and further confirmed by the Ld. DRP not sustainable in law. Hence directed to be deleted. Decided against revenue.

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• 2025 (3) TMI 1366
  Rejection of application for registration in Form No.10AB under clause (iii) of section 12A(1)(ac) and application for approval in Form No.10AB under clause (iii) of first proviso to sub-section (5) of section 80G - HELD THAT:- We find that admittedly the assessee made compliance to the initial notice issued by Ld. CIT, Exemption, Pune, but the subsequent notice could not be answered by him. It is the sole contention of Ld. AR that if the assessee has not furnished requisite information/documents on the requisite date, one further opportunity should have been provided to him by Ld. CIT, Exemption, Pune. It was further submitted that somehow the notice was missed the assessee could not respond in time. We find some force in the arguments of Ld. AR therefore considering the totality of the facts of the case in the interest of justice and without going into the merits of the case, we deem it appropriate to set-aside the order passed by Ld. CIT, Exemption, Pune and remand the matter back to him with a direction to give one more opportunity to the assessee to file the requisite details and decide the application for registration afresh as per fact and law after providing reasonable opportunity of hearing to the assessee. The assessee is also hereby directed to comply with the notices issued by Ld. CIT, Exemption, Pune and produce requisite documents/information in support of the application for registration without taking any adjournment under any pretext, otherwise Ld. CIT, Exemption, Pune shall be at liberty to pass appropriate order as per law. Thus, the grounds of appeal raised by the assessee are partly allowed.

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• 2025 (3) TMI 1365
  Revision u/s 263 - assessee s claim for deduction u/s. 54B was not found in order - validity of the jurisdiction that was assumed by the Pr. CIT for dislodging the order of reassessment that was passed by the A.O u/s. 147 r.w.s. 144B - Satellite data taken by ISRO - HELD THAT:- We are of a firm conviction that as the ISRO s report and CCOST report wherein it was stated that no agricultural activities were carried out on the subject land were there before the A.O in the course of the reassessment proceedings, and the same were rebutted by the assessee based on his exhaustive submissions and supporting documents filed in the course of the said proceedings, which, thereafter, had been accepted by the AO who had not drawn any adverse inferences on the aforesaid issue which, inter alia, had formed the very basis for reopening of his concluded assessment, therefore, it can safely be concluded that the AO had after considering the aforementioned documents arrived at a possible and plausible view that the subject land in the two years immediately preceding the date on which the same was transferred was used for agricultural purposes. We are unable to comprehend, that now when the AO had queried the assessee on the aforesaid issue which had a material bearing on his claim for deduction u/s 54B and further, deliberated upon the latter s reply and the supporting documents, then on what basis the Pr. CIT had observed that the A.O while framing the assessment had failed to examine the said claim for deduction in the backdrop of the aforesaid reports. On the contrary, we are of the view that the Pr. CIT in the garb of his revisional jurisdiction had sought to substitute the view that was arrived at by him by analyzing the satellite imageries provided by ISRO and the CCOST report, as against the plausible view that was arrived at by the A.O after carrying out necessary verifications, inquiries and deliberations. We are afraid that seeking of such substitution of view by the Pr. CIT falls beyond the scope and realm of the revisional jurisdiction vested with him under Section 263 of the Act. CIT in the course of the revisional proceedings, had vide his letter sought a fresh opinion of the CCOST, Raipur pursuant whereto, the latter had vide its letter dated 06.08.2024 filed its fresh opinion/report , but a careful perusal of the same does not reveal any new opinion/view but only a reiteration of its earlier view that the subject land was a fallow land on the aforementioned specific dates, viz. 23.03.2012, 02.10.2011, 19.11.2011, 29.05.2012 and 23.01.2010. Accordingly, the aforesaid report dated 06.08.2024 of the CCOST, Raipur cannot be construed as an additional information before the Pr. CIT which was not considered by the A.O while framing the reassessment vide his order passed u/s. 147 r.w.s. 144B of the Act, dated 30.05.2023. Land Revenue Records, viz. (i) Manual report of the Village patwari, dated 03.09.2019; (ii) Form P-II Khasra issued by patwari based on computerized land revenue records; and (iii) Order of Naib Tehsildar, District : Raipur, dated 12.03.2020 - A.O in the present case had after considering the reply filed by the assessee, wherein he had in the course of reassessment proceedings rebutted/dispelled the adverse inferences which the A.O had sought to draw as regards his claim of deduction u/s.54B of the Act, i.e., inter alia, for the reason that as per the patwari report, dated 03.09.2019 (supra) no agricultural operations were carried out on the subject land in F.Y.2010-11, had, thus, arrived at a possible and plausible view, therefore, the Pr. CIT in the garb of his revisional jurisdiction could not have sought to substitute his view as against that which was arrived at by the A.O based on necessary inquiries and verifications. Physical Verification Report obtained by FAO from the AO (Verification Unit) - A perusal of the A.O(VU) s Physical Verification Report reveals that he had after carrying out necessary physical verification, recording the statements of the assessee and Shri Hrithram Nisad, i.e. the erstwhile care taker, clicking photographs of the site, consulting the records as were filed before him, and deliberating upon the documents that were filed by the assessee with him, had concluded that the subject land was used for agricultural purposes in the two years immediately preceding the date on which the same was transferred. Considering the fact that the A.O(VU) in his Physical Verification Report (supra) had based on his inquiries/verifications reported that the subject land was in the two years immediately preceding the date on which it was transferred used for agricultural purposes, we find no reason as to why the view taken by the A.O in his order of reassessment passed u/s. 147 r.w.s. 144B of the Act, dated 30.05.2023 by relying on the said report amongst others, wherein he had accepted the assessee s claim as regards usage of the land during the relevant period for agricultural purposes is not to be construed as a possible and plausible view arrived at by him while framing the reassessment. We, thus, based on the judgment of Construction of park at NOIDA near Okhla Bird Sanctuary Vs. Union of India Ors. [ 2010 (12) TMI 1367 - SUPREME COURT] are of a firm conviction that in the case of the present assessee, the revenue records which evidence that the subject land in the two years immediately preceding the date on which the same was transferred was used for agricultural purposes ought to have been given credence as against the satellite imageries that have been pressed into service by the Pr. CIT, i.e. satellite images obtained from ISRO and CCOST reports (supra) analyzing the said satellite images. Accordingly, we are of a firm conviction that as the A.O in the present case before us had arrived at a plausible and possible view, i.e. the subject land in the two years immediately preceding the date on which the same was transferred used for agricultural purposes, therefore, there was no justification for the Pr. CIT to have exercised his revisional jurisdiction for the purpose of substituting his view as against the possible view that was arrived at by the A.O based on the material as was available before him in the course of the reassessment proceedings. Thus, as the Ld. Pr. CIT had in exercise of the powers vested with him u/s. 263 dislodged a possible and plausible view that was arrived at by the A.O after carrying out necessary inquiries, verifications and deliberations on the issue in hand, i.e. the subject land in the two years immediately preceding the date on which the same was transferred was used for agricultural purposes and, thus, had observed that the assessee s claim for deduction u/s. 54B of the Act was well founded and in order; therefore, the Pr. CIT by seeking substitution of his view as against the possible and plausible view arrived at by the A.O based on the same set of documents/material, had, thus, traversed beyond the scope of his jurisdiction u/s 263 of the Act. Accordingly, we herein set-aside the order passed by the Pr. CIT u/s. 263 and restore the order of reassessment passed by the A.O u/s. 147 r.w. Section 144B. Decided in favour of assessee.

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• 2025 (3) TMI 1364
  TDS u/s 194C - TDS on sub-contract payments made towards transport charges - Disallowance u/s 40(a)(ia) - HELD THAT:- It is admitted fact that the assessee has filed the return of income within the prescribed due date along with the audit report on 01.11.2017. In the assessment proceedings the assessee has filed the details of expenditure which are liable for TDS and corresponding TDS made by the assessee before the AO. Assessee also furnished payments made to Transport sub-contractors and stated that the TDS has not been deducted for these 12 sub-contractors, since these sub-contractors owned less than 10 goods carriages and have furnished the declaration to that effect along with their PAN. AO was not convinced since the assessee has failed to produce the declaration as required to file mandatorily u/s.194C(6) of the Act and disallowed 30% of the same u/s.40(a)(ia) - CIT(A) was pleased to confirm the same even though the assessee has submitted the entire details of TDS compliances made u/s.194C in respect of payments made to sub contract transporters before the CIT(A), NFAC, Delhi. We note that the assessee has filed quarterly E-TDS returns for all the 4 quarters within the prescribed due dates and the TDS provisions along with the certain corrected E-TDS returns by correcting certain error in the original E-TDS returns for few quarters. The assessee has deducted TDS on certain payments wherever applicable and has not made TDS on Transport sub-contractors payments made to 12 sub-contractors as these contractors owned less than 10 goods carriages and have furnished the declaration in compliance with the section of 194C(6) of the Act to the assessee. The assessee in turn has furnished the entire details of the Transport sub-contractors and corresponding payments made to them on quarterly basis, which has been uploaded in the quarterly E-TDS returns filed in Form No.26Q. The assessee had also issued Form No. 16A which have been generated from the website of the Income department (TRACES) and issued to the sub-contractors showing their transactions entered in all the 4 quarters of the impugned assessment year. Therefore, AO and the Ld.CIT(A) have erred in disallowing the Transport sub-contractor payments u/s.40(a)(ia) of the Act even though the assessee has complied with the provisions of section 194C(6). In the present facts and circumstances of the case the assessee has complied by collecting the declarations prescribed u/s.194C(6) from the Transport sub- contractors for having less than 10 goods carriages and thereby the assessee has not deducted TDS - Appeal of the assessee is allowed.

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• 2025 (3) TMI 1363
  Reopening of assessment u/s 147 - notice issued by non-jurisdictional AO Ward-3(4), Ludhiana - notice to an NRI - jurisdiction was assumed by the DCIT, International Taxation on the basis of the notice u/s 148 as issued by ITO Ward-3(l), Chandigarh - HELD THAT:- The assessee was a NRI from 2000 to 2013 and he had earlier been living in Afghanistan, but due to disturbed conditions, he came back to India under adverse circumstances, and also that there was no fresh issue of a notice u/s 148 by the Assessing Officer, International Taxation. The jurisdiction was assumed by the DCIT, International Taxation on the basis of the notice u/s 148 as issued by ITO Ward-3(l), Chandigarh. As the AO, ITO, Ward 3 (1) did not have the jurisdiction to issue the notice u/s 148, realising his mistake, on his own, he transferred the case to the DCIT, International Taxation, Chandigarh which is evident form the following observations of the AO without their being any intimation or request from the assessee. Thus, we have no hesitation in holding that the initiation of proceedings u/s 148 by the ITO Ward-3(1), Chandigarh was bad in law. Decided in favour of assessee.

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• 2025 (3) TMI 1362
  Not allowing credit for TDS as claimed in the return of income and as per 26AS - HELD THAT:- We find that AO/CPC in his 143(1) intimation has specifically mentioned that following are the details of unmatched tax deducted at source and with this remark the AO/CPC has also provided the names of all the four contractors who have reimbursed the amount to the assessee towards harvesting and transportation charges and deducted TDS thereon. From perusal of the above remark, it is very much clear that the AO/CPC has specifically mentioned the reason for not allowing the credit of TDS to the assessee and therefore the ground no.3 raised by the assessee in this regard fails and the contention of the assessee that the AO/CPC has not provided any reasons for not allowing TDS claim proves to be wrong. Assessee has produced Form 26AS downloaded on 18th June, 2020 wherein all the TDS entries are appearing. We deem it appropriate to set-aside the order passed by Ld. Addl./JCIT(A)-1, Coimbatore and remand the matter back to him with a direction to decide the appeal afresh as per fact and law after considering the orders passed by the AO for earlier assessment years starting from assessment years 2009-10 to 2014-15 and for assessment year 2016-17 wherein the claim of the assessee was accepted and refunds were also issued after making certain adjustments. The assessee is also hereby directed to respond to the notices issued by Ld. Addl./JCIT(A)-1, Coimbatore and furnish requisite details, if any, further required by Addl./JCIT(A)-1, Coimbatore and also to produce supporting documents/additional evidence in support of grounds of appeal without taking any adjournment under any pretext, otherwise Addl./JCIT(A)-1, Coimbatore shall be at liberty to pass appropriate order as per law. Appeal filed by the assessee is partly allowed for statistical purposes.

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• 2025 (3) TMI 1337
  Revision u/s 263 - case of the Assessee was selected for complete scrutiny wherein 14 issues were identified, however, the A.O. examined only three issues thus, AO has not applied his mind on all the 14 issues Claim of profit-linked deduction made u/s 80IA - HELD THAT:-Considering the documents produced by the Assessee, transfer pricing adjustment was also made by the TPO. Consequently, the assessment order was also passed making the very same addition. Thus, the TPO not only examined the issues, but also made substantial adjustment in TPO order. Thus, it is found that the observation of the PCIT that the separate books of accounts and balance sheets of eligible units have not been produced by the Assessee either before the AO or before the PCIT is factually incorrect. It is found that all the requisite details were filed by the Assessee before the AO, TPO as well as before the PCIT which could be corroborated from the submission filed by the Assessee, wherein the Assessee has produced all the details pertaining to such claim i.e. Form No. 10CCBs separate books of accounts, Form 3CEB, etc. Deduction u/s 35(2AB) of the Act for Research and Development Expenditure - It is found that A.O. has made exhaustive questionnaires on the issue of deduction u/s 35(2AB) of the Act for research and development expenditure and asked for all the relevant form and agreements, copy of approval from DSIR, Copy of Form 3CM, Form 3CK and 3CL, which were duly submitted to the A.O. during the assessment proceedings and the AO has verified all the documents and submission made by the Assessee. Difference between custom duty paid as per ITR and as per Import Export Data - It is found that it is not a case wherein the AO failed to conduct enquiry rather it is the case wherein the AO has conducted an elaborate enquiry and adopted one of the two views which was plausible view. The question would be as to whether in such circumstances the power u/s 263 of the Act would be invoked or not. The above said question is no longer res-integra and the said issue is well settled in several decisions. The proceedings u/s 263 of the Act cannot be for the purpose of making fishing/roving enquiries w.r.t. variety of issues only with an objective of substituting his views with that of the AO. As could be seen from the various show caused notices issued by the Ld. PCIT, the PCIT is asking the Assessee to substantiate its claim by submitting the various information and documentary evidence. Apart from the same, PCIT has dropped the revisionary proceedings on almost all issues except 3 issues, which shows that proceedings were initiated purely on guess work, surmises and with an intention to draw further information from the Assessee on the issues already settled in the assessment devoid of any basis / reason /information already being considered before issuance of SCN u/s 263 of the Act. The terms and tenure of the initial SCN dated 04.12.2023 does not indicates any concerted efforts on the part of PCIT for examination of assessment records and then forming of any reasonable belief/opinion whereupon the Assessee s assessment should be considered for revision. Such fishing and roving enquires cannot be permitted while exercising the power conferred u/s 263 of the Act as held by various judicial pronouncements. Appeal of the Assessee is allowed.

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• 2025 (2) TMI 1165
  Unexplained investments and unexplained receipts - additions have been made on the basis of information collected by the AO - HELD THAT:- We are of the considered view that even in the third round of litigations, the AO could not provide the specific information/ details collected from the companies on the basis of which the impugned additions have been made, are in complete violation of the principles of natural justice. Thus to sum- up even in the first round of litigation, AO could not provide the details which were the basis for making the impugned additions. Therefore, in our considered view, such additions cannot be sustained, keeping in mind the number of decades passed since the original assessment order was framed. Moreover, the additions have been made in violation of audi alteram partem. We, therefore, direct the AO to delete the impugned addition. Addition based upon the letter received from the Custodian - As no specific details of holding of shares for the impugned assessment year has been mentioned or provided to the assessee, the additions cannot be sustained. AO is directed to delete the same. Additions made on account of dividend details/warrants - The investment in shares DCM Ltd. of 2500 shares are coming from earlier years as the same is opening balance. Similarly, 3900 shares of Eicher Motors which were opening balance of the assessee were only 200 shares with bonus of 400 shares at the end of the impugned financial year. The holding of Golden Proteins at 15,300 shares have been wrongly taken from the opening balance of Gujarat Ambuja Proteins. The complete details of short-term capital gains and long-term capital gains on sale of shares during the impugned financial year have been given with complete details of dividends received from shares during the financial year. It would be pertinent to mention here that the entire additions have been based on dividends declared by the companies of which the assessee may or may not have held the shares during the year under consideration as the same is not based on physical holding of shares and merely on the basis of information collected behind the back of the assessee for which we have already expressed our view elsewhere. Therefore, this addition also cannot be sustained. Accordingly, Ground No. 2 with all its sub- grounds is allowed. Addition on account of unexplained receipts - We do not find any specific reason given for making the impugned addition as interest received on savings bank account, dividend income have already been shown by the assessee on its income statement and there is no specific mention as to entry in which bank account has not been shown/declared by the assessee. The additions have been repeated from the first round of litigation without any demonstrative evidence, therefore, the same is directed to be deleted. Allowability of interest expenditure - In assessee s own case for AY 1991-92, has allowed the claim of interest. On finding parity of facts we direct the AO to allow the entire claim of interest. Enhancement of assessed income on account of difference in the balance sheet in the books of account of Late Harshad Mehta - As we figures from the reconciliation statement hereinabove we find that the balance has been mentioned as balance as per the books of Harshad Mehta and the total balance which included share-market balance, money market balance and personal balance. It seems that the balance of Harshad Mehta have been considered with his own balance and not with the balance of Sudhir S. Mehta, which have been explained in the above chart and the balance stands totally reconciled. Therefore, the impugned enhancement made by the ld. CIT(A) is uncalled for and deserves to be deleted. Accordingly, Ground No. 6 is allowed. Levy of interest u/s 234D - In our considered opinion, provisions of Section 234D of the Act are not applicable in the facts of the case inasmuch as, there was no refund issued to the assessee as there was no processing of return u/s 143(1) of the Act. Our view is fortified by the decision in the case of Delta Airlines Inc [ 2011 (9) TMI 21 - BOMBAY HIGH COURT] We accordingly direct the AO to not charge interest u/s 234D of the Act. Levy of interest u/s 234A and 234B - In our considered view, such levies are mandatory but only up to the date of original assessment order which is dated 20/03/1995. The AO is directed to charging interest u/s 234A and 234B of the Act up to the date of original assessment order.

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• Customs

• 2025 (3) TMI 1361
  Seeking provisional release of containers pending clearance by securing the differential duty claimed by the Department - Section 110A of the Customs Act, 1962 - HELD THAT:- As far as securing the differential duty is concerned, there are no difficulty in the said condition being imposed. In fact, the learned counsel appearing on behalf of the Petitioner fairly conceded that the Petitioner is willing to secure the differential duty by furnishing a bank guarantee. As far as this aspect is concerned, there are no difficulty in the condition imposed by the Department. Redemption fine - HELD THAT:- The Department is also justified in asking the Petitioner to secure redemption fine because admittedly this would be payable for release of the goods (of course subject to the fact that they were properly seized). The condition to secure the redemption fine is also justified. Penalty - HELD THAT:- Before adjudication of the show cause notice, there is no justification on the part of the Department to ask the Petitioner to secure the penalty. It is not as if that in every single case penalty has to be imposed. Considering these facts and circumstances, it is directed that the goods of the Petitioner covered under Bill of Entry No. 6517826 dated 6th November 2024 and Bill of Entry No. 7587153 dated 3rd January 2025 shall be provisionally released on the Petitioner securing the differential duty as well as the redemption fine as more particularly set out in the emails dated 16th January 2025 and 28th February 2025 respectively. Conclusion - The provisional release of goods ordered upon securing the differential duty and redemption fine, without requiring the securing of penalties. The demand for securing differential duty for past cases not upheld. Petition disposed off.

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• 2025 (3) TMI 1360
  Challenge to detention order under COFEPOSA Act - smuggling of foreign origin gold from Yangoon (Myanmar) to Gaya - it is the main contention of the petitioner that even though he has been released on bail by the High Court in connection with the aforesaid criminal complaint for the same incident, because of the impugned order of detention under the provisions of the COFEPOSA Act, he is continuing in detention for no purpose, which is illegal and arbitrary - HELD THAT:- The object of detention under the detention law is not to punish, but to prevent the commission of certain offences. Further, in the recent decision rendered by the Hon ble Supreme Court in the case of Ameena Begum [ 2024 (1) TMI 4 - SUPREME COURT ], it has been specifically held by the Hon ble Supreme Court that a constitutional court, when called upon to test the legality of orders of preventive detention, would be entitled to examine certain aspects referred in paragraph 28.1. to 28.10 of the said decision. In the case of Saraswathi Seshagiri [ 1982 (3) TMI 252 - SUPREME COURT ], the Hon ble Supreme Court has observed that the concerned detenue tried to export Indian Currency to the tune of Rupees 2,88,900.00 to a foreign country in a planned and pre-meditated manner by clever concealment of it in several parts of his baggage and, therefore, the Hon ble Supreme Court observed that the detaining authority was justified in coming to the conclusion that he might repeat his illegal act in future also. His past act in the circumstances might be an index of his future conduct. Thereafter, the Hon ble Supreme Court observed that the authority may prosecute the offender for an isolated act or acts of an offence for violation of any criminal law, but if it is satisfied that the offender has a tendency to go on violating such laws, then there will be no bar for the State to detain him under a Preventive Detention Act. What is required is that the detaining authority is to satisfy the Court that it had in mind the question whether prosecution of the offender was possible and sufficient in the circumstances of the case. It has been further observed that in some cases of international smuggling where it may not be possible to collect all necessary evidence without unreasonable delay and expenditure to prove the guilt of the offender beyond reasonable doubt, the past conduct or antecedent history of a person can appropriately be taken into account while passing the detention order. In the case of Rekha [ 2011 (4) TMI 1217 - SUPREME COURT ], the Hon ble Supreme Court has observed that if the ordinary law of the land (the Penal Code and other penal statutes) can deal with a situation, recourse to a preventive detention law will be illegal. Another contention raised by the petitioner is that there was a delay in service of the order of detention by contending that the detention order has been passed on 06.03.2024, which was communicated to him on 29.05.2024. However, the aforesaid contention is also misconceived. From the records, it transpires that the order of detention was passed on 06.03.2024, which was duly executed on the petitioner on 11.03.2024. Though the petitioner was made aware of his right to represent, he did not avail the same by making representation to the detaining authority and the Central Government and when the case of the petitioner was referred to the Advisory Board on 10.04.2024, he filed his defence statement there and the Advisory Board, after conducting the proceedings on 29.04.2024 and 13.05.2024, gave its opinion and opined that the detention of the petitioner is justified - it cannot be said that the order of detention dated 06.03.2024 was communicated to the petitioner on 29.05.2024. Hence, the said contention is misconceived. Conclusion - In the present case, the respondent detaining authority has followed all the constitutional, statutory and procedural requirements as well as safeguards. The subjective satisfaction of the detaining authority does not vitiate, as has been contended by the petitioner. Therefore, when the detaining authority after satisfying itself subjectively after considering all the relevant material, passed the impugned order of detention, the same cannot be interfered with while exercising power under Article 226 of the Constitution of India. Petition dismissed.

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• 2025 (3) TMI 1359
  Invocation of extended period of limitation - issuance of multiple SCN on same facts - Classification of imported fabrics - to be classified under CTH 55151230 or not - eligibility for BCD exemption under N/N. 026/2000-Cus. dt. 01.03.2000 - HELD THAT:- The Commissioner of Customs had ordered the extension of period of limitation by six months as proposed in the SCN and accordingly, in strict compliance thereto, Department did issue another SCN under Section 28 and 124 of the Customs Act. There is no dispute that the said notice is issued just before the expiry of six months. The time limit extended by the Commissioner having been honoured, the only course available was to adjudicate at least this second SCN, but however, the issuance of another show cause notice after the extended six months period, by violating the Commissioner s OIO has been questioned since this SCN is apparently issued by invoking the extended period of limitation. The arguments of the appellant is that the extension provided by the Order-in-Original [supra] was for issuing SCN and nothing else and once the SCN having been issued, the Revenue could not have assumed jurisdiction once again, that too after the expiry of permitted six months by treating directions in the said OIO as an endless permission, which is not permissible under the Statute. This even cannot be accepted since the said notice which came to be adjudicated per impugned Order-in-Original was issued clearly after the artificially permitted extension of time and hence, the very foundation itself is not proper. Conclusion - i) The invocation of the extended period of limitation for issuing SCNs not justified, as the facts were already known to the authorities, and subsequent notices based on the same facts did not constitute suppression. ii) The procedural lapse regarding cross-examination did not materially affect the decision, as the primary issue was the improper invocation of the extended period. Appeal allowed on limitation.

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• 2025 (3) TMI 1358
  Levy of penalties u/s 112(a) of the Customs Act, 1962 on appellant - undervaluation of imported goods - denial of cross-examination and the non-supply of crucial documents - violation of principles of natural justice - satatement of co-accused - HELD THAT:- There is not an iota of evidence to establish that the appellant was in effect the kingpin in the racket of undervalued imports of said goods. The fact that the appellant was a financer who enabled the payment of differential duty through the importers /the custom broker cannot ipso facto be held to conclude the appellant as the importer, and who had knowledge about the undervalued imports or intentionally involved in such malpractice of goods and subjected to penal proceedings under Section 112(a). It is an undisputed fact that the department neither provided cross-examination of the co-accused as sought for by the appellant nor provided the basic import documents to the appellant for furtherance of his defence and while rightly going about redetermination of the transaction values in accordance with law failed to establish nexus of the appellant with the improper imports effected. The admitted role of the appellant being that of a financer of subject imports having voluntarily made good the differential duty of Rs.30 lakh cannot lead to conclude that the appellant had knowledge and intentionally indulged in such imports when there is nothing on record to establish the connection of the appellant to of having done an act rendering the offending goods liable for confiscation - There is nothing on record to bring out any specific knowledge on the part of the appellant herein or having played a role in under-valued imports. Moreover, as stated earlier the appellant has been denied a total recourse to Natural Justice in the present matter, in as much as even the Bill of Entry and the import invoice not supplied to him, and there s no reason for such a course of action. Conclusion - The statement tendered by the co-accused lacks evidentiary value unless it is examined and an opportunity of cross examination provided to the accused. Nothing therefore comes out on record to substantiate the penal liabilities imposed on the appellant in the instant matter. As held in a series of cases non-supply of Relied upon/Non-Relied upon documents as also not affording cross-examination are a serious flaw and violation of natural justice. The impugned order is set aside - appeal allowed.

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• 2025 (3) TMI 1357
  Confiscation of imported goods - levy of redemption fine and penalty - finalization of the provisional assessment not challenged - HELD THAT:- The finalization of the assessment of Bills of Entry was never challenged by the Revenue. Therefore, on that score itself the valuation matter has reached finality. The impugned OIA, which was passed when the matter was sub judice before the Tribunal, does not survive - Appeal allowed.

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• Corporate Laws

• 2025 (3) TMI 1356
  Validity of revival of struck off company - Interpretation of statute - second proviso of Section 252 of Companies Act, 2013 - Striking off the name of a company from the register of companies - HELD THAT:- The plain reading of second proviso to Section 252, shows that where the Registrar of Companies feels that the name of the company has been struck off from the Register of Companies either inadvertently or on the basis of incorrect information furnished (as has been stated to be the case by the Respondents in the present Petition), the Registrar of Companies may within a period of three years from the date of passing of the order dissolving such company under Section 248 of the 2013 Act, file an application under Section 252 of the 2013 Act seeking restoration of the name of such company before the Tribunal. The procedure, as set out in second proviso to Section 252 of the 2013 Act, is that the Registrar must, within a period of three years from the date of order of dissolving the company, file an application before the National Company Law Tribunal seeking restoration of such company. Concededly, the Respondent No. 2 has taken no such steps as are required under the provisions of the 2013 Act, yet the Company was revived. In addition, since the order dissolving the Company was dated 11.01.2016, such steps were required to be taken by the Respondent No. 2 within three years from such date which has also not been done. Thus, the action of the Respondent No. 2 cannot be sustained. Conclusion - The Respondent No. 2 is directed to strike off the name of the company from the Register of Companies and to take all necessary steps in accordance with the law. Petition allowed.

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• Insolvency & Bankruptcy

• 2025 (3) TMI 1355
  Dismissal of Section 7 application filed by the Financial Creditor-Appellant on the grounds of being time-barred - sufficient ground for allowing extension of the period of limitation and the applicability of the suo moto orders of the Hon ble Supreme Court or not - HELD THAT:- It is well settled that if a corporate debtor acknowledges its debt in writing before the expiration of the three-year period, the limitation period would be extended by another three years. This is in conformity with Section 18 of the Limitation Act, which allows for the revival of the limitation period based on the acknowledgment of debt. The question of acknowledgement of liability made in a Balance sheet as acknowledgement of debt has been considered by the Hon ble Supreme Court in Tulip Star [ 2022 (8) TMI 70 - SUPREME COURT ] wherein it has been held that balance sheet entry can be regarded as an acknowledgment of liability for the purpose of limitation law. The argument canvassed by the Appellant that there is acknowledgement of debt in the balance sheet for FY 2019-20 considered, and it is noticed that the said balance sheet of FY 2019-20 was signed on 12.08.2020, Even in this case, para 5.III of the suo moto orders would have been attracted and the last date for filing of Section 7 petition would have continued until expiry of 90 days from 01.03.2022. Since the Section 7 petition was filed on 15.01.2024, it, therefore, stood clearly time-barred. The Adjudicating Authority has correctly held that the exclusion period under suo moto orders does not come to the rescue of the Appellant even in this case. Whether acknowledgment in Balance sheet for the purpose of limitation has to be counted from the date of signing of the Balance sheet or from the date of its uploading with the RoC on the MCA portal? - HELD THAT:- The conditionalities required for attracting Section 18 of the Limitation Act, 1963 are (i) an admission or acknowledgement of liability; (ii) such acknowledgement must be in respect of a property or right; (iii) that the acknowledgement must be made before the expiry of limitation and (iv) that it should be in writing and signed by the party against whom such property or right is claimed. The Explanation clause thereto, however, provides that an acknowledgment may be sufficient though it may omit to specify the exact nature or the specific character of the said liability. However, the person acknowledging must be conscious of his liability and commitment should be made towards that liability - Any writing to be an acknowledgment of liability must entail an admission of a subsisting jural relationship between the parties and there should be a conscious affirmation of an intention of continuing such relationship in respect of this existing liability. Guidance also provided by judgement of Hon ble High Court of Andhra Pradesh in Vijaya Kumar Machinery Electrical Stores Versus Alaparthi Lakshmikanthamma [ 1968 (1) TMI 23 - ANDHRA PRADESH HIGH COURT ] wherein it has been held that that the date on which the balance-sheet was signed is material to constitute an acknowledgment. Conclusion - There are no error on the part of the Adjudicating Authority to have relied on the date of signing of the Balance sheet for extension of limitation period - There is no merit in the argument of the Appellant that the Adjudicating Authority had wrongly calculated the extension of limitation from the date of signing of the Balance sheet by the Corporate Debtor i.e. on 12.08.2020 instead of calculating it from the date it was uploaded on the MCA website i.e. on 14.02.2021. There is no mandatory requirement for factorising the date of uploading of the balance sheet on the MCA portal for computing the period of limitation. There are no merits in the appeal - appeal dismissed.

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• PMLA

• 2025 (3) TMI 1354
  Condonation of delay of 708 days in filling the Appeal - Money Laundering - challenge to provisional attachment order - sufficient cause for delay or not - merger of ING Vysya Bank with Kotak Mahindra Bank - HELD THAT:- There is no doubt that the order, confirming the provisional attachment was passed on 01st June, 2016 and it is the admitted position that the same was received on 03rd June, 2016 by the bank - In the opinion of this Court, the merger of the Transferor Bank (ING Vysya Bank) with Kotak Mahindra Bank in April, 2015, is a justifiable reason and cause that could have resulted in the delay. Upon the perusal of Section 26 of the PMLA, it would show that after the initial period of 45 days, there is no outer limit prescribed and the question would be whether there is sufficient cause or not - firstly, there is no outer limit and there is also no negative stipulation that delay beyond a particular period would not be condonable. A Coordinate Bench of this Court, in Directorate of Enforcement v. O P Nahar [ 2022 (5) TMI 1362 - DELHI HIGH COURT ] while adjudicating an appeal from an order of the Appellate Tribunal wherein the appeal under Section 26 of the PMLA was rejected due to delay of 204 days in its filing. The Court condoned the delay and inter alia held that the Appellant therein sufficiently explained the delay for not filing the appeal within the prescribed period. This Court takes into consideration the fact that the Appellant is a bank and since it was going through the merger process, it cannot be said that the delay is completely inexplicable. Mergers of banks would involve complicated processes, technological integration, customer integration, staff related issues, compliances etc., have to be put in place. This could have delayed the filing of the appeal due to various procedural and administrative reasons. Conclusion - The merger process provides a sufficient cause for the delay, thereby condoning it and restoring the appeal for adjudication on merits. The merger process provided a sufficient cause for the delay, thereby condoning it and restoring the appeal for adjudication on merits - The appeal shall now be restored to its original number before the Appellate Tribunal and shall be adjudicated on merits in accordance with law.

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• 2025 (3) TMI 1353
  Money Laundering - proceeds of crime - Provisional Attachment Order - diversion of depositors amount to personal accounts routed through company s bank accounts for wrongful gain and amassed huge movable and immovable assets by utilizing illegally gained money of depositors - impact of a civil court decree in favor of the appellants regarding the title and possession of the disputed property - HELD THAT:- The property in question was existing in the name of Heera Retail Pvt. Ltd. of Hyderabad on the payment of consideration of Rs.5 Crores and other amount of Rs. 2 Crore paid by M/s Heera Gold Exim Ltd. and Rs.3.48 Crore by M/s Heera Retail Pvt. Ltd. much prior to the decree dated 19.11.2018. The statement given above shows that the property in question was existing in the name of M/s Heera Retail Pvt. Ltd. out of proceeds of crime much prior to the decree and was not challenged in the suit and M/s Heera Retails Pvt. Ltd. was not even made party to the suit. Apart from the Civil Suit, the appellant even preferred a Writ Petition No. 15019/2019 to challenge the attachment of the property under the Act of 1999. The Writ Petition was disposed of with liberty to the appellant to avail alternate remedy under Section 7(3) of the Act of 1999. The appellant accordingly approached the Metropolitan Sessions Judge to challenge the order of attachment under the Act of 1999. The learned Metropolitan Sessions Judge allowed the application preferred by the appellant. It was based on the Civil Decree ignoring the fact as to whom it would be binding and how the decree was taken by the appellant. The Metropolitan Sessions Judge though took note of the fact that the property was conveyed in favour of M/s Heera Group of companies who was none else but accused. It ignored consequence of sale deed in favour of M/s Heera Group of companies which has purchased the property out of the proceeds of crime. It was made party to the civil suit yet, an order was passed against the interest of the company holding the property. The accused was otherwise not interested to pursue the claim because in that case, it would have been auctioned in the light of the order passed by the Apex Court. In the instance case, M/s Heera Retail Pvt. Ltd, was not party to the suit, despite purchase of the property and whose sale deed was never challenged. The decree cannot operate against it. Since the property was owned by M/s Heera Retail Pvt. Ltd., a group company of main accused Smt. Nowhera Shaik, we do not find any illegality in the attachment as the decree of the Civil Court was not binding on the group company of accused M/s Heera Retails Pvt. Ltd. The Apex Court in the case of Niyamat Ali Molla Vs. Sonargon Housing Co-operative Society Ltd. and Ors. [ 2007 (10) TMI 616 - SUPREME COURT ] held that persons not parties to the suit would not be bound by the decree. The claim of the appellants based on collusive decree by City Civil Court cannot be accepted against others than party to the suit. It is more so when it is going against the sale deed executed in favour of the accused s Company M/s Heera Retail Pvt. Ltd. and remain unchallenged. No suit for cancellation of sale deed was filed against the said Company and even the sale deed in favour of M/s Neelanchal Technocrats Pvt. Ltd. The claim of the appellants is based on the Civil Suitwhere M/s Heera Retail Pvt. Ltd. was not a party. The decree in the Civil Suit binds only the parties and not the others. The property came to the accused s company pursuant to the sale deed in its favour in the year 2016 by M/s Neelanchal Technocrats Pvt. Ltd. who was holding it under the deed and whose title and sale deed was never challenged by the appellants even while filing a suit to claim their right. The execution of sale deed was in the knowledge of the appellant as is coming out from the suit yet it was not challenged. The accused colluded with the appellants after registration of the FIR in the year 2012. The suit was not contested by M/s Neelanchal Technocrats Pvt. Ltd. after a sale deed in favour of M/s Heera Retail Pvt. Ltd. The property of the accused M/s Heera Retail Pvt. Ltd. has been attached as it was purchased out of the proceeds of crime. Thus, there is no case to cause interference in the impugned orders. The order produced before this Tribunal is dated 28.03.2023 where a detailed order was passed for settling the dues of the investors and therein it was made clear that the property attached by the ED can be released for realization of the dues if the prospective purchasers are willing to deposit the amount of Rs. 641 crores and in that case, the attachment of the ED would be lifted but leaving the parties to take remedies for their respective rights - The subsequent order produced before us is dated 11.11.2024. The reference of the order of the Apex Court has been given to clarify that confirmation of attachment would not in any way affect the investors for realization of the amount, rather the order passed by us would also remain subject to the further direction of the Apex Court in pending cases. The detailed order is, however, passed by this Tribunal to clarify the claim of the appellants. This is not a case to cause interference in the orders. Conclusion - The decree cannot operate against a person who was not party to the suit. Since the property was owned by M/s Heera Retail Pvt. Ltd., a group company of the main accused Smt. Nowhera Shaik, there are no illegality in the attachment as the decree of the Civil Court was not binding on the group company of accused M/s Heera Retails Pvt. Ltd. Appeal dismissed.

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• Service Tax

• 2025 (3) TMI 1352
  Demand of service tax prior to 01.06.2007 under Interior Decorator Service for the periods prior to June 2007 and from June 2007-September 2009 - invocation of extended period of limitation - demands of service tax under Completion and Finishing services. HELD THAT:- The Appellant was a registered Service Tax assessee under Interior Decorator service w.e.f. 29.01.2008 and under Works Contract Service from 12.10.2009. The SCN were issued proposing demand of service tax under Interior Decorator service which were confirmed by the Original Adjudicating Authority and penalties imposed, whereas the impugned order confirmed the demands under Completion and Finishing services for the period only from 16.06.2005. The Appellant maintained that even prior to 01.06.2007, he was rendering works contract services as the contract was a composite one involving supply of materials and labour and hence not chargeable to service tax under Interior Decorator service prior to 01.06.2007 in terms of the Hon ble Supreme Court s decision in Commissioner vs. Larsen Toubro Ltd. [ 2015 (8) TMI 749 - SUPREME COURT] . A perusal of the appeal records indicate that the assessee is engaged in rendering of services related to carpentry work, false ceiling, flooring, painting, electrical work, civil work, layout of offices, etc. which is squarely covered under Completion and Finishing services which falls within the ambit of Commercial or Industrial Construction service w.e.f. 16.06.2005 and being so such services are also covered under the definition of Works contract services w.e.f. 01.06.2007. The demands were made under Interior Decorator service and confirmed by the Adjudicating Authority whereas the impugned order confirmed the demands w.e.f. 16.06.2005 under Completion and Finishing services. The impugned order has thus travelled beyond the Show Cause Notice and the demand prior to and after 01.06.2007, for this reason alone, cannot sustain. For the period after 01.06.2007, the demand confirmed by the adjudicating authority was under interior decorator service instead of under Works Contract service and hence the demand is also not legally sustainable. As the demand itself could not sustain, the question of invocation of extended period for demand of duty and penalty does not arise. Conclusion - i) The services provided by the appellant in respect of the projects executed by them for the period prior to 1-6-2007 being in the nature of composite works contract cannot be brought within the fold of Interior Decorator service in the light of the Hon ble Supreme Court judgment in Larsen Toubro. ii) For the period after 01.06.2007, for activities involving indivisible composite works contract, service tax is leviable under Works Contract Service as defined under section 65(105)(zzzza) but the demand has been inadvertently made under Interior Decorator service/ Completion and Finishing services and hence does not sustain as the demand itself suffers from infirmities. Appeal allowed.

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• 2025 (3) TMI 1351
  Dismissal of appeal as time barred having been filed after more than one month beyond the period of two months prescribed in Section 85(3A) of the Finance Act, 1994, which cannot be condoned - whether delay in filing the appeal before the Commissioner (Appeals) being beyond the period of 2+1 month can be condoned or not? - HELD THAT:- The appellant bonafide prosecuted the appeal before Meerut Division within the extended period of one month by filing the appeal on 07.07.2017, however on 11.07.2017 the appellant was intimated that the appeal filed before the Meerut Division cannot be transferred internally to Dehradun Division, therefore, the said period needs to be excluded. Further, the appellant diligently prosecuted the appeal by making the pre-deposit amount after seeking due clarification from the department. Here also, the letter dated 14.04.2017 by the appellant was replied by the Department vide letter dated 16.05.2017. The delay in responding to the letter by the Department by almost one month cannot be attributed to the appellant. Therefore, the test laid down under the provisions of Section 14 are fully satisfied. Without going into too many details, if the limitation is computed from the date of the receipt of the order, i.e., 12.04.2017 till the date of filing of the appeal before the Dehradun Division on 13.07.2017, the total period comes to 91 days as against 90 days and if the period before the Meerut Division from 7.07.2017 to 11.07.2017 is excluded by virtue of the provisions of Section 14 of the Limitation Act, the appeal filed by the appellant was within time. Keeping in view the peculiar facts of the present case, the appellant is entitled to the benefit of the exclusion of time in pursuing the appeal before Meerut Division and, therefore, the appeal finally filed before the Dehradun Division is not barred by limitation. Conclusion - The appellant s appeal is not barred by limitation due to the exclusion of time spent in prosecuting the appeal at the incorrect jurisdiction. The matter is remanded to the Commissioner (Appeals) for adjudication on the merits, allowing the appellant to have their appeal heard substantively. Appeal allowed by way of remand.

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• 2025 (3) TMI 1350
  Refund of service tax paid on 60% of the value of services rendered under a reverse charge mechanism - refund can be allowed without modifying the assessment or not - HELD THAT:- Since the issue in the present appeal relates to the refund claim, the same has to be considered in the light of the decision of the Apex Court in the case of ITC Ltd. Vs. CCE, Kolkata-IV [ 2019 (9) TMI 802 - SUPREME COURT (LB)] where the law has been settled that the refund proceedings being in the nature of execution proceedings, the refund cannot be sanctioned and allowed without modifying the assessment. In the present case, the appellant had paid the service tax on 60% of the value of the service so rendered and made the refund claim on 5.4.2016. The refund application was decided by the Adjudicating Authority on merits that the refund claim was filed incorrectly as the assessee themselves were liable to pay service tax on 50% of the total value of the billing amount. As the assessee was held to be himself liable to pay duty for which the refund is claimed, the refund claim was held to be unsustainable. The Tribunal in the case of M/s. Jagdamba Phosphate vs. Commissioner of CGST, Udaipur [ 2024 (10) TMI 1547 - CESTAT NEW DELHI] held that since the appellant had not assailed the self-assessments and as per assessments, the appellant is not entitled to any refund, the refund claim was rejected. Conclusion - i) A self-assessed return is considered an assessment, and unless modified, it cannot be questioned in refund proceedings. ii) Refund claims require the original assessment to be challenged and modified through the appropriate legal channels. Appeal dismissed.

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• 2025 (3) TMI 1349
  Liability of appellant who had registered under the category of Construction of Residential Complex Service to pay service tax for the entire amount for the period from October 2005 to April 2007 - HELD THAT:- It is well settled that service tax on service component of works contract became leviable only with effect from 01.06.2007 and demand of service tax under Construction of Residential Complex Service is unsustainable as per the judgment of the Hon ble Supreme Court in the matter of CCE, Kerala vs. L T Ltd. [ 2015 (8) TMI 749 - SUPREME COURT] . The issue is no more res integra and it is well settled law that even if the appellant s activities have been registered under Construction of Residential Complex Service and confirming service tax demand prior to 01.06.2007 is unsustainable. Appeal allowed.

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• 2025 (3) TMI 1348
  Recovery of service tax with interest and penalty - whether service tax would be charged simply on the basis of invoices issued or after completion of services? - HELD THAT:- The Appellant was providing Real Estate Agent Service . In the Service Tax Act which came into effect, after introduction of negative list concept, with effect from 01.07.2012, there was no definition of real estate agent. However, prior to negative list regime, real estate agent was defined under Section 65 (88) of the Finance Act, 1994 as a person who was engaged in rendering any service in relation to sale, purchase, leasing or renting of real estate. In common trade parlance also, real estate agent means a person who works with clients to help them buy, sale or rent real estate. It shows that service under the category of real estate agent service is completed when actual sale or purchase or rent of real estate had taken place. The invoice is required to be issued within 30 days after completion of the service or on receipt of payment towards value of taxable service. The important issue in this case is to ascertain whether the invoices were issued by the Appellant after completion of service or not. In this context, it is found that due to business closure of Amrapali Group of Companies, activities of sale, purchase could not take place. So, invoices issued by the Appellant cannot be treated proper invoice in terms of Rule 4(A) of the Service Tax Rules, 1994. For issuance of invoice, completion of service is an essential condition, which has visibly not taken place in this case. So, no service tax is chargeable on the basis of invoice which was issued before completion of work. When no demand is sustainable, imposition of any type of penalty is improper and unwarranted. Conclusion - Service tax is not chargeable on invoices issued without service completion, and demands cannot be based solely on ITR figures without verifying actual service provision. Appeal allowed.

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• 2025 (3) TMI 1347
  Failure to discharge service tax - whole case of demand was built up merely on the basis of figures shown in Form 26AS statement - discharge of burden to prove - invocation of extended period of limitation - demand of interest and Penalty - HELD THAT:- The demand of service tax was determined merely on the basis of figures of Form 26AS without examining any other document with a view to ascertain as to whether the receipts shown in Form 26AS was in respect of service only. It is a known fact that Form 26AS statement is prepared by the Income Tax Department, not by the taxpayers. There may be chances of error in such statement. It is further seen that the figure shown in Form 26AS statement differ with turnover declared in respective Balance Sheet. The Department have not made any enquiry to ascertain the reason of the difference between figures shown in balance sheet and Form 26AS statement. Neither the adjudicating officer nor the appellate authority has tried to find out nature of services rendered by the Appellant. Service tax demands require establishing the four elements mentioned above. Shifting burden of proof, The Department cannot solely rely on ITR/26AS discrepancies to shift the burden of proof to the taxpayer. In this context, reference is made to the decision of the Tribunal in the case of United Telecom Ltd., [ 2010 (10) TMI 730 - CESTAT, BANGALORE] wherein it has been held that no demand can be confirmed unless exact liability is not decided. Demand of interest and penalty - HELD THAT:- When the demand of tax itself is not sustainable, the demand of interest and imposition of penalty does not survive. Penalty on Shri Arvind Singh Director of the company is also liable to dropped as the demand case against the company of the Appellant does not survive. Conclusion - i) The service tax demands cannot be based solely on Form 26AS figures without corroborating evidence. ii) The invocation of the extended period of limitation is not justified as the Department had prior knowledge of the liability. iii) Penalties under Sections 70 and 78A and well as interest, are set aside due to the lack of a valid demand. Appeal allowed.

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• 2025 (3) TMI 1346
  Classification of service - Commercial or Industrial Construction Service or not - construction activities undertaken by the appellant at the police training academy / office premises of Tamil Nadu Police Housing Corporation - Levy of service tax on the repair and maintenance work at police academy which has been carried out by the Appellant - levy of penalty - extended period of limitation. Classification of service - Commercial or Industrial Construction Service or not - construction activities undertaken by the appellant at the police training academy / office premises of Tamil Nadu Police Housing Corporation - HELD THAT:- The appellant has placed reliance on the decisions of the Tribunal in RD Contractor Company versus CCE ST, Anand, vide Final Order No. A/10313-10314/ 2023 dated 22.02.2023, where the Tribunal had considered whether the construction service provided to Gujarat State Police Housing Corporation for construction of residential complex for police staff is liable of service tax and has held that there will be no liability on the appellant therein and has allowed the appeal placing reliance on the decision in the case of S. Kadirvel vs. CCE ST, Trichy, [ 2013 (8) TMI 262 - CESTAT CHENNAI] , which too has been relied upon by the appellant - The proposal in the show cause notice in the instant case is to cover the construction activities of the appellant rendered to police academy/TNHPC, under commercial or industrial construction service, given the nature of work which is seen more specifically elaborated in Annexure II to the SCN. Moreover, the appellant too has not raised any specific pleading that the activities of the appellant are more specifically covered under construction of complex service. The demand of service tax on the services rendered by the appellant in the buildings at police academy/TNHPC is unsustainable. Levy of service tax on the repair and maintenance work at police academy which has been carried out by the Appellant - HELD THAT:- When the Department had already proposed to cover the services of the appellant rendered to the aforesaid policy academy under commercial or industrial construction service , then we see no reason why the classification of the services rendered by the appellant to police academy in respect of certain activities of repair are thereafter proposed for coverage under the head management, maintenance or repair service , when the said definition of commercial or industrial construction itself, under section 65 (25b) (d), included repair, alteration, renovation or restoration of, or similar services in relation to, building or civil structure . As such, when the activities of the appellant are prima facie coverable under the limbs of a particular classification being proposed in the SCN, then artificially separating some activity and categorizing it under yet another classification is arbitrary and thus wholly untenable - The demand of service tax made in the SCN on the aforesaid activities of the appellant with respect to Police Academy/TNHPC are not tenable and are therefore set aside. Levy of penalty - extended period of limitation - HELD THAT:- In the facts and circumstances of the appellants case considering that the tenability of the other demands as proposed in the SCN were of debatable nature, even though it is found that grounds for imposition of penalty under Section 78 as invoking of extended period is also held to be tenable, nevertheless, in the circumstances, it is deemed it fit to invoke the provisions of Section 80 as it existed during the relevant period to set aside the penalties imposed - The penalties are set aside, but the extended period for demand is upheld. Conclusion - i) The construction activities at government-owned institutions not engaged in commerce or industry are not taxable under Commercial or Industrial Construction Service. ii) The construction of CETP is taxable under Commercial or Industrial Construction Service as it serves commercial establishments. iii) The invocation of the extended period for demand is justified, but penalties can be set aside under Section 80 in certain circumstances. Appeal disposed off.

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• 2025 (3) TMI 1345
  Refund of service tax paid on GTA services which were used for the purpose of export of excisable goods under Notification No. 41/2012-ST dated 29.06.2012 - rejection of claim of the appellant for the entire amount in view of the para 3 (b) of Notification No. 41/2012 ST dated 29.06.2012 - HELD THAT:- The legislature has used words person liable to pay service tax which shows specific intention that the person who pays the service tax under Section 68 will not be eligible to claim rebate. Section 68 (2) starts with non-obstante clause i.e. Notwithstanding . Therefore, by virtue of subsection (2) certain category of service receiver become person liable to pay and therefore are hit by para 3 (b) of Notification No. 41/2012-ST dated 29.06.2012 - The central government vide notification no. 31/2012-ST dated 20.06.2012 granted exemption from payment of service tax in the case of services provided to an exporter for transport of goods by Goods Transport Agency (GTA). So the exemption from payment of service tax on GTA services for export is well covered by this notification. It shows the intention of the legislature that instead of granting rebate in case of service provided by the Goods Transport Agencies (GTA), where the service recipient is liable for payment of service tax, an absolute exemption from payment of service tax is granted separately. The learned Commissioner (Appeals) has also cited the decision of Hon ble Tribunal in case of M/s. Nahar Industrial Enterprises Ltd [ 2014 (12) TMI 205 - CESTAT NEW DELHI] in which it agreed with the findings of Commissioner (Appeals) who has held that the refund of service tax paid on freight on transportation of goods for export from factory to port of export involved under Section 68(2) of the Finance Act, 1994 was not eligible as per para 2 (a) of the N/N. 17/2009-ST dated 07.07.2009 - The Tribunal in the above case agreed with the above findings of the Commissioner (Appeals) and did not find any ground to interfere in the findings recorded in the order-in-appeal and with these observations the Tribunal dismissed the appeal. Conclusion - The appellant is not eligible for a refund under N/N. 41/2012-ST due to their status as the person liable to pay service tax under Section 68. The Commissioner (Appeals) has not committed any irregularity, illegality or error in passing the impugned order - Appeal dismissed.

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• 2025 (3) TMI 1344
  Eligibility of refund of service tax paid on a specified services i.e. GTA, used for export of goods under N/N. 41/2012-S.T. dated 29.06.2012 - refund is denied in the light of the provisions of para 3(b) of the N/N. 41/2012-ST dated 29.06.2012 - HELD THAT:- The impugned order passed by the learned Commissioner (Appeals) dated 25.04.2017 is based on the correct appreciation of the Notification No.41/2012-ST dated 29.06.2012 and it is also based on the law laid down by the CESTAT-Delhi in M/s. Nahar Industrial Enterprises Ltd [ 2014 (12) TMI 205 - CESTAT NEW DELHI] . Therefore, there is no reason to interfere in the impugned order. In M/s. Nahar Industrial Enterprises Ltd it has been observed by the CESTAT- Delhi that it agrees with the findings of the Commissioner (Appeals) who has observed in the impugned order that condition 2(a) of the said Notification No.17/2009-ST stipulates that the person liable to pay service tax under Section 68 of the said Act on the specified service provided to the exporter and used for export of the said goods shall not be eligible to claim exemption for the specified service. As respondents were liable to pay the said amount of service tax under Section 68 (2) of the Act and they accordingly discharged the said liability, they shall not be eligible to claim exemption for specified services in view of the condition 2(a) of the said Notification. Thus, there is strength in the contention of the department that the said amount of refund claim is not as per proviso (c) to para 1 and condition 2 (a) of the N/N.17/2009-ST dated 07.07.2009. Conclusion - The appellants are not entitled to a rebate of service tax under Notification No.41/2012-ST. Appeal dismissed.

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• Central Excise

• 2025 (3) TMI 1343
  Refund of Education Cess Secondary High Education Cess - rejection of refund of Education Cess Secondary High Education Cess on the basis of the Hon ble Apex Court Judgments in the case of Unicorn Industries Vs. UOI [ 2019 (12) TMI 286 - SUPREME COURT] - HELD THAT:- This issue has already been settled by this Bench in the appellant s own case involving identical issue M/S INSECTICIDES INDIA LTD VERSUS COMMISSIONER OF CG ST, JAMMU [ 2021 (11) TMI 784 - CESTAT CHANDIGARH] wherein it has been held that the orders of the Commissioner (Appeals) is bad in law and the Tribunal has also directed the adjudicating authority to implement the orders passed by the Tribunal in the earlier round of litigation. The Tribunal in the appellant s own case M/S INSECTICIDES INDIA LTD VERSUS COMMISSIONER OF CG ST, JAMMU [ 2021 (11) TMI 784 - CESTAT CHANDIGARH] have allowed the claim of the appellant by relying upon the judgments of the Hon ble Supreme Court in the case of SRD Nutrients Pvt. Ltd [ 2017 (11) TMI 655 - SUPREME COURT] . Further, it is found that the appellant was also a party before the Hon ble Apex Court in the case of SRD Nutrients Pvt. Ltd. The review filed by the Department in SRD Nutrients Pvt Ltd. was also dismissed by the Hon ble Supreme Court. Further, it is found that before the Commissioner (Appeals) appellant has challenged only part of the adjudication order withholding/rejecting part of the refund claim whereas the Commissioner (Appeals) not only rejected the pending refund claim itself rather ordered for recovery of amount of the already sanctioned claims without any authority of law. Conclusion - The appellants are entitled to a refund of E.Cess and SHE Cess. Appeal allowed.

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• 2025 (3) TMI 1342
  Exemption from service tax - providing services of construction of stadium at Sector-21, Noida against contract awarded by New Okhla Industrial Development Authority - demand made on the basis of receipts shown in 26AS statement - demand of interest and penalty. Demand of service tax made on the basis of receipts shown in 26AS statement - period 2015-16 2016-17 - HELD THAT:- Construction of original work which is for the purpose of non-commercial activities for government or local or governmental authority was exempt from service tax. Governmental authority was defined as an authority established by an Act of the Parliament or a State legislature and was hundred percent in the control of Government. It was also provided that such body must perform works as mentioned in Article 243W of the Constitution. Noida Authority is set up by the U.P. Government in exercise of powers conferred under Section 3 of the Uttar Pradesh Industrial Area Development Act, 1976 passed by U. P. Legislative Assembly. As per Section 3(3) of the UPIAD Act, the management including chief executive will be appointed by the U.P. Government. It shows that hundred percent control of the body established under the UPIAD Act will be by the U.P. Government. As per Section 6 (e) of UPIAD Act, the function of the Authority set up under the said Act includes to provide amenities and municipal services. The above facts confirm that Noida Authority falls within ambit of governmental Authority as defined under clause 2(s) of Notification No.25/12-ST dated 20.06.2012. Whether a sports stadium is for non-commercial activities or not? - HELD THAT:- A stadium is a place or venue for (mostly) outdoor sports, concerts, or other events and consists of a field or stage completely surrounded by a tiered structure designed to allow spectators to stand or sit and view the event. It is also used for morning walks. Basically, construction of sports stadium is for boosting sports. Its purpose is not for any commercial activities. The above finding also finds support from the decision of the Tribunal in the case of B.G. Shirke Construction Technology Pvt. Ltd. [ 2013 (2) TMI 584 - CESTAT MUMBAI] held The Sports Stadia is used for public purpose. Merely because some amount is charged for using the facility, it cannot become a commercial or industrial construction. Even in a Children Park, entry fee is levied for maintenance of the Park. Merely because some amount is charged for using the Park, it cannot be said that it is a commercial or industrial construction. Adopting the same logic, the Sports Stadia in the present case is also a non-commercial construction for use by the public. Therefore, we are prima facie of the view that the Sports Stadium constructed for conducting Commonwealth Games, is a non-commercial construction. - thus, sport stadium is predominantly used for purposes other than commercial. It is explicit from the findings that all terms and conditions specified under Notification No.25/12-ST dated 20.06.2012 as amended by N/N. 09/16-ST dated 01.03.2016 were fulfilled in the case at hand. Hence, services rendered by the Appellant were exempted from service Tax. Demand of interest and penalty - HELD THAT:- When the demand of tax itself is not sustainable, the demand of interest and imposition of penalty does not survive. Conclusion - The services provided to a governmental authority for non-commercial purposes are exempt from service tax, even if some fees are charged for maintenance or use. Appeal allowed.

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• 2025 (3) TMI 1341
  Levy of penalty on Managing Director u/r 26 of Central Excise Rule, 2002 for the omission on the part of the company in mis-declaring the goods manufactured by them - HELD THAT:- It is found that other than being the Managing Director of M/s. Ruchi Soya Industries Ltd., there is no direct involvement of the appellant and there is no allegation regarding his personal involvement. The penalty was imposed only on the ground that the Managing Director is ultimately responsible for all the affairs of the company and hence, he is also liable to be penalized. There are strong force in the contention raised by the appellant that there is no finding showing involvement of the appellant in mis-declaring the goods. Moreover, the issue is on classification of goods and as submitted by appellant during the investigation, the aspect of payment of central excise duty, classification etc., cannot be held as the personal responsibility and being the Managing Director, it cannot be alleged that he is personally involved without substantial evidence regarding his active involvement in the alleged suppression of facts. Conclusion - The imposition of a penalty on the appellant under Rule 26 of the Central Excise Rules, 2002, was unsustainable due to the lack of evidence of personal involvement. Appeal allowed.

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• 2025 (3) TMI 1340
  Reversal of cenvat credit on inputs and capital goods such as explosives, detonators, lubricants, components, items, etc. provided on non-chargeable basis to contractors for mine development work/or production in terms of Rule 3(5) of Cenvat Credit Rules, 2004 - extended period of limitation - interest - penalty - HELD THAT:- Consistent views have been taken time and again not only by the Tribunal and the High Courts but also by the Apex Court that the judicial discipline and proprietary demands that the Adjudicating Authority or the Appellate Authority should follow the binding decisions of the Tribunal. The Apex Court in Union of India Vs. Kamlakshi Finance Corporation Ltd. [ 1991 (9) TMI 72 - SUPREME COURT] has categorically held that the order of the Tribunal is binding upon the Assistant Collector and the Appellate Collectors, who function under the jurisdiction of the Tribunal and they should be followed unreservedly by the subordinate authorities. It was further held that mere fact that the order of the Appellate Authority is not acceptable to the Department in itself is an objectionable phrase and is no ground for not following it unless the operation of the said order has been suspended by a competent court. The logic in holding so has been stated that if this rule is not followed, there will be undue harassment to the assesses and chaos in administration of the tax laws. The present case clearly reveals this, though not only one but four orders of the Tribunal and specially in the case of the appellant are on record on the same issue but the Authorities below have chosen not to follow. There is no sale and no removal of inputs and capital goods when the assessee supplied the same to the contractor, which was used for mine development activity and, therefore, the provisions of Rule 3(5) are not applicable. In the circumstances, the appellant was not required to reverse the credit availed in respect of the impugned items. Extended period of limitation - interest - penalty - HELD THAT:- Merely providing the inputs and capital goods to the contractor for use within the captive mines for mine development works of the appellant does not amount to removal and thereby, do not attract the provisions of Rule 3(5) of CCR. Since the issue has been decided on merits in favour of the appellant, the question of extended period of limitation, levy of interest and penalty does not survive. Conclusion - The appellant is not liable to reverse the CENVAT credit on the inputs and capital goods provided to contractors for mine development activities. Appeal allowed.

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• Indian Laws

• 2025 (3) TMI 1339
  Dishonour of Cheque - presumption under Section 139 of the NI Act in favor of the cheque holder could be rebutted at the stage of issuing process by the Judicial Magistrate First Class (JMFC) or not - HELD THAT:- In the present case, a statutory notice under Section 138 of the NI Act was issued by the advocate for the respondent on 11th November 2016 to the appellant. The notice proceeds on the footing that the respondent, a Co-operative Credit Society, is providing financial assistance to its members and is also carrying on banking business. The allegation in the notice served to the appellant is that the appellant was a member of the credit society and had taken an overdraft facility from the respondent in the sum of Rs.11,97,000/-. Paragraph 1 of the notice specifically relies upon the fact that the appellant has executed necessary documents and that the appellant has agreed and acknowledged to make repayment of the amount advanced with interest. Thereafter, the notice proceeds to describe how the cheque issued by the appellant in the sum of Rs.27,27,460/- was returned unpaid. It is pertinent to note that in the notice under Section 138 of the NI Act, in paragraph 1, the respondent specifically relied upon documents executed by the appellant and the acknowledgment of the loan made by the appellant. By a reply dated 28th November 2016, the appellant informed the respondent that by filing a written application, the appellant had demanded certain documents, which had not been provided. What is pertinent to note is that the respondent does not deny the receipt of the reply dated 28th November 2016. No reply was sent by the respondent pointing out that the documents were supplied. Even in the letter dated 13th December 2016, the appellant made the same grievance regarding the non-supply of the documents relied upon in the demand notice. Before filing the complaint, the respondent failed to respond to the said letter. The fact remains that in the complaint, the respondent has suppressed the reply dated 28th November 2016 and the letter dated 13th December 2016 sent by the appellant s advocate. These two documents have also been suppressed in the statement on oath. The respondent made out a false case that the appellant did not reply to the demand notice. Moreover, the case that the documents as demanded were supplied is not pleaded in the complaint and statement under Section 200 of CrPC. While filing a complaint under Section 200 of CrPC and recording his statement on oath in support of the complaint, as the complainant suppresses material facts and documents, he cannot be allowed to set criminal law in motion based on the complaint. Setting criminal law in motion by suppressing material facts and documents is nothing but an abuse of the process of law. Conclusion - The complaint filed under Section 138 of the NI Act is held invalid due to the suppression of material facts and the non-supply of requested documents. The impugned order of the High Court is set aside - Appeal allowed.

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• 2025 (3) TMI 1338
  Dismissal of petition on the ground that the appellants/petitioners has got the statutory remedy available to them by way of invoking Section 18 of the SARFAESI Act and filing an appeal before the Debt Recovery Appellate Tribunal - HELD THAT:- It is true that there is no bar for this Court to entertain a writ petition, however, in case of availability of efficacious and alternative statutory remedy, this Court can interfere in a petition filed under Article 226 of the Constitution of India in very rare cases. The SARFAESI Act is a code, scheme of which provides for various statutory remedies available to the parties at various stages of the proceedings drawn and conducted under the said Act. Merely, because the appellants/petitioners will be required to deposit certain amount to avail the remedy of the appeal under Section 18 of the SARFAESI Act, it cannot be said that this Court would necessarily invoke the jurisdiction under Article 226 of the Constitution of India. Reference made to a judgment of Hon ble Supreme Court in the case of PHR Invent Educational Society v. UCO Bank and others [ 2024 (4) TMI 466 - SUPREME COURT (LB)] , wherein it has clearly been held that the High Court would ordinarily not entertain a petition under Article 226 of the Constitution of India, if an effective remedy is available to the aggrieved person. Conclusion - The requirement to make a deposit under Section 18 of the SARFAESI Act does not justify bypassing the statutory remedy in favor of a writ petition. The principle of exhausting alternative remedies is upheld.

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