Newsletter: Where Service Meets Reader Approval.
TMI Tax Updates - e-Newsletter
March 30, 2018
Case Laws in this Newsletter:
GST
Income Tax
Customs
Corporate Laws
Insolvency & Bankruptcy
Service Tax
Central Excise
CST, VAT & Sales Tax
Indian Laws
TMI SMS
Articles
News
Notifications
DGFT
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59/2015-2020 - dated
28-3-2018
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FTP
Insertion of policy condition under Chapter 41, 42 and 43 of ITC (HS), 2017—Schedule—1(Import Policy)
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58/2015-2020 - dated
28-3-2018
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FTP
Amendment in Para 2.31 of Foreign Trade Policy, 2015-2020
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57/2015-2020 - dated
28-3-2018
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FTP
Amendments in Foreign Trade policy 2015-2020, related to import of raw Sugar under DFIA scheme
GST
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20/2018 - dated
28-3-2018
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CGST
Extension of due date for filing of application for refund under section 55 by notified agencies
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19/2018 - dated
28-3-2018
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CGST
Extension of date for filing the return in FORM GSTR-6
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18/2018 - dated
28-3-2018
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CGST
Seeks to extend the due dates for the furnishing of FORM GSTR-1 for those taxpayers with aggregate turnover of more than ₹ 1.5 crores
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17/2018 - dated
28-3-2018
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CGST
Seeks to prescribe the due date for quarterly furnishing of FORM GSTR-1 for those taxpayers with aggregate turnover of upto ₹ 1.5 crore
GST - States
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EXN-F(10)-14/2018-16/2018-State Tax - dated
27-3-2018
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Himachal Pradesh SGST
Last date for filing of return in FORM GSTR-3B
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EXN-F(10)-14/2018-15/2018-State Tax - dated
27-3-2018
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Himachal Pradesh SGST
Appoint the 1st day of April, 2018, as the date from which the provisions of sub-rule (ii) of rule 2, [other than clause (7)], (iii), (iv), (v), (vi) and (vii) of rule 2 of notification No. 12/2018–State Tax, dated the 22nd March, 2018,
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EXN-F(10)-14/2018-14/2018-State Tax - dated
27-3-2018
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Himachal Pradesh SGST
The Himachal Pradesh Goods and Services Tax (Fourth Amendment) Rules, 2018.
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EXN-F(10)-14/2018-10/2018-State Tax (Rate) - dated
23-3-2018
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Himachal Pradesh SGST
Amendment in the Notification of the Government of Himachal Pradesh, in the notification No. 8/2017 – State Tax (Rate), dated 30th June, 2017.
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EXN-F(10)-14/2018-13/2018-State Tax - dated
22-3-2018
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Himachal Pradesh SGST
Rescind the notification of the Government of Himachal Pradesh, No. 6/2018-State Tax, dated the 30th January, 2018.
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EXN-F(10)-14/2018-12/2018-State Tax - dated
22-3-2018
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Himachal Pradesh SGST
The Himachal Pradesh Goods and Services Tax (Third Amendment) Rules, 2018.
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ACCT/TP/GST/Noti/500-516-40/2018 - dated
26-3-2018
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Jammu & Kashmir SGST
Last date for filing of return in FORM GSTR.3B
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SRO 122 - dated
5-3-2018
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Jammu & Kashmir SGST
Reimbursement of Central Taxes for Promotion of Industries in the State of Jammu and Kashmir.
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SRO GST 31-(Rate) - dated
29-1-2018
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Jammu & Kashmir SGST
Amendment in Notification No. SRO-GST-13 DATED 08.07.2017
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SRO GST 30-(Rate) - dated
29-1-2018
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Jammu & Kashmir SGST
Amendment in Notification No. SRO -GST-12 DATED 08/07/2017
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10/2018 - dated
23-3-2018
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Karnataka SGST
Amendment in the Government of Karnataka Notification (8/2017) No. FD 48 CSL 2017, dated the 29th June, 2017.
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08/2018 - dated
23-3-2018
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Karnataka SGST
Appoints the 1st day of April, 2018, as the date from Which the provisions of rules 2. [other than Clause (7)]3., 4., 5, 6. And 7. of notification (4-N/2017) No. FD 47 CSL 2017, dated the 15th March, 2018.
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01-C/2018 - dated
23-3-2018
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Karnataka SGST
Seeks to prescribe the due dates for filing FORM GSTR-3B for the months of April to June, 2018.
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04-N/2017 - dated
15-3-2018
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Karnataka SGST
The Karnataka Goods and Services Tax (Fourth Amendment) Rules, 2018.
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07/2018 - dated
7-3-2018
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Karnataka SGST
Rescinding notification No. 04/2018 - CT dated 23.01.2018.
IBC
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No. IBBI/2017-18/GN/REG030 - dated
27-3-2018
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IBC
Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Second Amendment) Regulations, 2018
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No. IBBI/2017-18/GN/REG028 - dated
27-3-2018
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IBC
Insolvency and Bankruptcy Board of India (Liquidation Process) (Amendment) Regulations, 2018
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IBBI/2017-18/GN/REG027 - dated
27-3-2018
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IBC
Insolvency and Bankruptcy Board of India (Insolvency Professionals) (Amendment) Regulations, 2018
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IBBI/2017-18/GN/REG 029 - dated
27-3-2018
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IBC
INSOLVENCY AND BANKRUPTCY BOARD OF INDIA (INFORMATION UTILITIES (AMENDMENT) REGULATIONS, 2018
Circulars / Instructions / Orders
Highlights / Catch Notes
GST
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Seeks to prescribe the due date for quarterly furnishing of FORM GSTR-1 for those taxpayers with aggregate turnover of upto ₹ 1.5 crore - Notification
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Extension of the due dates for the furnishing of FORM GSTR-1 for those taxpayers with aggregate turnover of more than ₹ 1.5 crores - Notification
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Extension of date for filing the return in FORM GSTR-6 - Notification
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Extension of due date for filing of application for refund u/s 55 by notified agencies - Notification
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Levy of GST - Petrol and Diesel - case of petitioner is that the petroleum and diesel should be brought forthwith within the ambit of Goods and Service Tax - this Court is not in a position to issue any positive direction to the respondents to consider the prayer sought for by the petitioner. - HC
Income Tax
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Since the assessee had no business income, no books of account were maintained and the addition was made only on the basis of the assessee’s pass book, which is not a book of account; that as such, the addition made under section 68 of the Act is not sustainable - AT
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It is true that principles of res judicata do not apply to income tax proceedings, but principles of consistency apply. So, if an AO wants to deviate from the path followed in the earlier year, he has to give reasons for it. - AT
Customs
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Confiscation - mis-declaration of goods - FSSAI certificate - Tribunal posed a specific query to the Departmental Representative whether there was any prohibition for import of the goods for industrial use but to be consumed as animal feed, he could not point out anything beyond stating that they are not fit for human consumption. This definitely was not the answer to the query of the Tribunal. - HC
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100% EOU - debonding obligation - not achieving value addition - Once the element of intention to evade duty is absent and as a matter of fact there is no such allegation in the SCN, demand of duty, confiscation of capital goods and imposition of penalty ought not to have been fastened on the respondent. - HC
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Concessional rate of duty - appellant has imported components at concessional rate of duty for manufacture of mobile phone and LED/LCD televisions at their factory in Uttarakhand - goods were rejected and cleared them as scrap - demand confirmed - AT
DGFT
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Import policy for Second Hand Goods imported for the purpose of repair / refurbishing / re- conditioning or re- engineering is laid down.
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Import policy of seal skin under Chapter 41, 42 and 43 of ITC (HS), 2017-Schedule-1 (Import Policy) is notified.
Indian Laws
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Cabinet approves enhancing the coverage of Pradhan Mantri Rojgar Protsahan Yojana
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IBBI Notifies Amendments to The Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016
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Validity of Arbitral Award - time limitation - Having accepted the award through Anilkumar Patel, being the head of the family, appellant Nos. 1(a) to 1(d) and respondent No.10 cannot turn round and contend that they had not received the copy of the award - SC
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A Member of Institute of Chartered Accountants of India (ICAI) can not be said as aggrieved person against the Institute of Cost Accountants of India for using the acronym 'ICAI' - HC
IBC
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Bar of jurisdiction under Insolvency & Bankruptcy Code - action by District Disaster Management Authority sinking FDD - impact on the corporate debtors - Tribunal is barred to interfere with the jurisdiction exercised by the Collector of Goa.
Service Tax
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Place of provision of services - The appellant are not intermediaries in terms of Rule 2(f) of the Place of Provision of Service Rules, 2012. Therefore, the appellants are not liable to pay service tax being provider of service in India in terms of Rule 9 of the Place of Provision of Service Rules, 2012. - AT
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Scope of Service Tax Act - State of Jammu and Kashmir - GTA Service - reverse charge mechanism - no provision related to Service Tax Law is applicable to services rendered in the state of Jammu & Kashmir - AT
Central Excise
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Interest - relevant date for calculation of interest - Setting aside an order means there is no order and party relegated for fresh adjudication. Stage of adjudication cannot be said to be determination. An adjudication will culminate in an order and such order would be determination and/or ascertainment of duty, and no interest is payable - HC
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VCES Scheme - time limitation - CENVAT credit - As such, it was necessary, under the scheme, to receive the discharge certificate before availing the credit, in which case, even limitation would not get involved. - AT
VAT
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Validity of order of reassessment - in order to invoke jurisdiction u/s 22(1) of the VAT Act or to initiate proceedings for reassessment there must be an order of assessment duly passed by the assessing officer and it must be in existence as a condition precedent to invoke Section 22(1) - there is no deeming fiction under the act - reassessment order is invalid - HC
Case Laws:
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GST
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2018 (3) TMI 1453
Release of detained goods - Rule 140(1) of the Kerala GST Rules, 2017 - Held that: - the writ petition is disposed of directing the competent authority to complete the adjudication provided for under Section 129 of the statutes - It is also directed that if the petitioner complies with Rule 140(1) of the Kerala Goods and Services Tax Rules, 2017, the goods detained shall be released to them forthwith.
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2018 (3) TMI 1452
Detention of goods - Section 129 of the CGST as also the Kerala State Goods and Services Tax Act - Held that: - it is for the petitioner to raise those grounds before the detaining authority itself at the first instance. In the said view of the matter, the writ petition is disposed of directing the respondent to complete the adjudication provided for under Section 129 of the statutes - petition disposed off.
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2018 (3) TMI 1451
Levy of GST - Petrol and Diesel - case of petitioner is that the petroleum and diesel should be brought forthwith within the ambit of Goods and Service Tax, so that the selling price would drastically reduce and as a consequence, the prices of the Goods and essential commodities would come down, which would ultimately benefit to the common people, especially poor and down trodden. Whether this Court in exercise of its Jurisdiction under Article 226 of the Constitution of India can issue any positive direction to the Goods and Central Services Tax council to bring petrol and diesel prices within the ambit of Goods and Service Tax? Held that: - In the considered opinion of this Court, it cannot issue any direction for the reason that it is for the Goods and Service Tax council to take a call in that aspect and Section 9(2) of the 'Act' also deals with the Central Tax on the supply of petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural gas and aviation turbine fuel - The Goods and Service Tax council is having representation of the State Governments also and therefore, their views have also to be elicited, before the Goods and Service Tax council take a call as to bring the petrol and diesel prices within the ambit of Goods and Service Tax. It is a well-settled position of law that it is not for the Court to determine whether a particular policy or particular decision taken in the fulfillment of that policy is fair. It is only concerned with the manner in which those decisions have been taken and the extent of the duty to act fairly will vary from case to case. It is for the Central Government to act on the recommendations of the Goods and Service Tax council as to bring the petroleum and diesel prices within the ambit of the Goods and Service Tax, this Court is not in a position to issue any positive direction to the respondents to consider the prayer sought for by the petitioner. Petition dismissed - decided against petitioner.
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2018 (3) TMI 1450
Detention of goods - it was alleged that there was no nexus between the documents accompanied and actual goods under transport - Held that: - the Intelligence Inspector shall made a fresh assessment recomputing the value of the goods and shall compute the CGST and SGST payable together with penalty. On payment of 50% of such demand along with execution of a simple bond for the balance amounts, the goods shall be released - petition disposed off.
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Income Tax
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2018 (3) TMI 1470
Seeking refund of the TDS deposited - Held that:- As the matter is pending scrutiny before the competent officer at this stage exercising the discretion under Section 143(1d) of the Income Tax Act, no mandamus can be issued by this Court in the matter. The petitioner may approach the competent authority of the department furnishing all information and we direct the department to complete the scrutiny assessment and thereafter proceed to consider the question of refund in accordance with law. We dispose of the writ petition with liberty to the petitioner to approach the authority when the matter is pending for scrutiny assessment.
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2018 (3) TMI 1469
Penalty under section 271D - assessee has violated section 269 SS as accepted deposits over ₹ 20,000/in cash - Held that:- In case of Shivaji Ramchandra Pawar (2018 (2) TMI 1467 - BOMBAY HIGH COURT), this court had observed that mere fact that a party accepts loans in cash which are otherwise explainable would not absolve a party from penalty under section 271 D of the Act in absence of a reasonable cause. In the present matter it has been observed by the Commissioner (Appeals) and the Tribunal concurrently that the auditor of the respondent advised that Section 269SS of the Act are not applicable to the assessee on the ground that assessee's business is akin to the bank. CIT(Appeals) and Tribunal observed that it is based on the advise of the Auditor. The assessee believed the advice and it can not be said that the assessee's bona fide belief was genuine and honest.Section 271D is a penalty proceedings. The Tribunal and the Commissioner (Appeals) concurrently appreciated the explanation given and found the explanation to be within the purview of reasonable cause. No substantial question of law arises.
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2018 (3) TMI 1468
Reopening of assessment - notice was not issued within the time limit - Held that:- Permanent Account Numbers issued. The notices were dispatched at the address which was available in the system of the department. The petitioner had never applied for change of address and, therefore, the department was obviously not aware about it. These are disputed questions of facts. Whether the system of the department contains the petitioner's old address as declared by him earlier and, therefore, the department was correct in sending the notice to such address would need proper examination. The petitioner's contention that without the change of the address, the system would not accept the petitioner's returns declaring new address also cannot be brushed aside. These are issues we are not inclined to go in a writ petition. These issues need to be gone into in the departmental proceedings in regular assessments. The authorities would have sufficient time and opportunity to examine such disputed questions.
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2018 (3) TMI 1467
Addition u/s 68 - addition on account of sundry creditors - genuineness of the transactions - creditors did not respond to the notices issued u/s. 133(6) by the AO - Held that:- The assessee had at the outset, contrary to what was observed by the Assessing Officer, supplied necessary details of all transactions and persons with whom such transactions were made. Wherever there was lack of response from these persons during the assessment, the Commissioner of Income Tax (Appeals) believed the genuineness of the transactions on the basis of the remand report called for during the appellate proceedings. The issues are thus, purely factual in nature. Commissioner of Income Tax (Appeals) and the Tribunal concurrently held that the additions under section 68 were incorrectly made - no question of law arise - Decided against revenue
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2018 (3) TMI 1466
Imposition of penalty u/s 271(1)(c) - deliberate claim of loss of sale though the same was not an actual state of affairs - reason given by the assessee that the assessee was advised by the Chartered Accountant - Held that:- The Tribunal in its order relied on the Judgment of the Apex Court in a case of Dilip N. Shroff Vs. JCIT and another (2007 (5) TMI 198 - SUPREME Court) and observed that there has to be a conscious concealment on the part of the assessee and that a mistake in not returning any income by itself would not constitute reason enough for imposition of penalty. The Tribunal has accepted the contention of the assessee on the basis of the affidavit filed by the Chartered Accountant / advisor that he gave wrong advise and the situation were explained about the bona-fide error being committed with regard to the applicability of the provision of law. The benefit was claimed on the basis of the deleted provision wherein the assessee had debited the amount to the profit and loss account on account of loss of sale of vehicles. The assessee was not entitled for it as it was not engaged in driving of vehicles. It would also be clear that the survey was made only on 10th February, 2004 and on the basis of the same the matters were taken up for assessment years 1999-2000, 2000-2001, 2001-2002, 2002-2003 and 2003-2004. The Tribunal on merits has taken a plausible view. No substantial question of law.
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2018 (3) TMI 1465
TP adjustment - notional interest on outstanding receivables chargeability - Held that:- Notional interest on outstanding receivables is not chargeable and no TP adjustment can be made. See Pegasystems Worldwide Versus ACIT [2015 (10) TMI 2495 - ITAT HYDERABAD] Working capital adjustment takes into consideration the interest on the receivables as well. Therefore, on this ground also, no TP adjustment is required. See case of Kusum Healthcare Pvt Ltd.[2017 (4) TMI 1254 - DELHI HIGH COURT]
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2018 (3) TMI 1464
Penalty u/s 271(1)(c) - treating declaration as Long term Capital gains as wrong and erroneous - bonafide belief -sale consideration received against sale of furniture, being the solitary transaction, would be treated as income from other sources and not capital gain - contention of the assessee has been that it was done under the bonafide belief that the furniture and fixtures sold with the building partake the character of sale consideration of capital asset - Held that:- The bonafide of the assessee appears to have not been considered by the ld. Authorities below in right perspective. At the initial stage of quantum proceedings, there were two different opinions of the Revenue authorities itself on this issue, inasmuch as the Assessing Officer treated the impugned sum as income from other sources whereas the ld. CIT(A) in first round of appeal by the assessee treated the same amount as income from long-term capital gain. Once, the Revenue Authorities had expressed two views on the same issue, how the bonafide of the assessee to show the said amount as income from long term capital gains could be doubted by the Authorities below. However, the fact remains, that the assessee had declared all particulars of the impugned receipts before the Revenue authorities. Mere making of a claim not found sustainable under law, the same would not amount to concealment of income or furnishing of inaccurate particulars of income for saddling penalty against the assessee as held by Hon’ble Apex Court in Reliance Petroproducts (2010 (3) TMI 80 - SUPREME COURT). It is also notable that there is no comments of the authorities below on declaration of the impugned amount in the return of income, though it was shown under different. Only the head of income has been changed by the Assessing Officer. There being no concealment of the impugned sale consideration on the part of assessee, not a fit case to impose penalty u/s. 271(1)(c) - Decided in favour of assessee
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2018 (3) TMI 1463
Disallowance of expenses as discounts allowed, forwarding expenses and quality difference - application of GP rate @ 2% on total turnover - assessee submitted as losses in the business - Held that:- Where the assessee had not originally filed its return of loss, then the plea of assessee that it had incurred losses is not backed by any evidence whatsoever. The year under appeal is assessment year 2010-11 i.e. financial year 2009-10 and the assessee has not filed any evidence of the loss of the year at ₹ 15,32,732/- as mentioned in the statement of facts. Even the books of account evidencing the same were not available with the assessee. The assessee had admittedly computerized books of account in September, 2012 in which the loss has been worked out to ₹ 15,32,732/-. The auditor has signed the said accounts on 28.09.2012 i.e. much after the due date of signing and filing the audit report for the year ending 31.03.2010. Such book results shown by the assessee cannot be relied to compute the income in the hands of assessee. Accordingly, we uphold the order of CIT(A) in applying the GP rate to determine the income in the hands of assessee. The provisions of section 145 of the Act are squarely attracted. However, we direct the Assessing Officer to apply GP rate at 1% on the total turnover of ₹ 11.83 crores in order to determine the income in the hands of assessee. - Decided partly in favour of assessee
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2018 (3) TMI 1462
Addition u/s 68 - assessment u/s 153A - Held that:- Since the assessee had no business income, no books of account were maintained and the addition was made only on the basis of the assessee’s pass book, which is not a book of account; that as such, the addition made under section 68 of the Act is not sustainable. See ‘CIT vs. Bhaichand H. Gandhi’ (1982 (2) TMI 28 - BOMBAY High Court) - It is undisputed that the addition was made only on the basis of the assessee’s bank pass book, which is not sustainable in law. - Decided in favour of assessee Addition under the head Income from House Property - ALV determination - Held that:- It is seen that the provisions of section 23(4) (b) of the Act stipulate that where the property consists of more than one house, the annual value thereof shall be determine under section 23(1), as if such property had been let out. It has also been so held in ‘Dr. Prabha Sanghi’, (2013 (1) TMI 18 - ITAT DELHI). In accordance with the same, the grievance by way of the ground no.1 is accepted. The addition is deleted.
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2018 (3) TMI 1461
Depreciation of assets acquired by assessee trust - the capital expenditure is treated as application of income for charitable purposes - Held that:- The income of the Trust is required to be computed under section 11on commercial principles after providing for allowance for normal depreciation and deduction thereof from gross income of the Trust. Also it also follows that once assessee is allowed depreciation, he shall be entitled to carry forward the depreciation as well. See CIT III, Pune Versus Rajasthan And Gujarati Charitable Foundation Poona [2017 (12) TMI 1067 - SUPREME COURT] - Decided in favour of assessee
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2018 (3) TMI 1460
Penalty u/s 271(1)(c) - non specification of charge - Held that:- AO has initiated the penalty for concealment of particulars of income or furnishing of inaccurate particulars, which is contrary to the provisions of law. I am of the view that notice issued by the AO u/s. 271(1)(c) read with Section 274 of the Act is bad in law as it does not specify which limb of section 271(1)(c) of the Act, the penalty proceedings had been initiated i.e. whether for concealment of particulars of income or furnishing of inaccurate particulars. Therefore, the penalty in dispute is not sustainable in the eyes of law, hence, cancel the penalty in dispute. See CIT & Anr. Vs. M/s SSA’s Emerald Meadows – 2015 (11) TMI 1620 – Karnataka High Court - Decided in favour of assessee.
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2018 (3) TMI 1459
Disallowance u/s 40A(3) - payment to suppliers in cash - Held that:- The assessee had produced all the bills, cash memos and money receipts of the payees before the lower authorities. Though the assessee had not established the circumstances which warranted it to pay the suppliers in cash by any cogent evidence, it had filed an affidavit duly notarized and signed by the partner of the assessee firm clearly deposing that the cash payments had to be made on the insistence of the suppliers and their refusal to accept the cheques. It was also pleaded that all the suppliers are duly registered with sales tax authorities and having PAN. This affidavit has been filed by the assessee only before us for the first time. The contents of the affidavit requires examination by the lower authorities and hence in the interest of justice and fairplay, we deem it fit and appropriate, to remand this issue to the file of the ld AO to decided it afresh - Decided in favour of assessee for statistical purposes.
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2018 (3) TMI 1458
Revision u/s 263 - Addition of share capital and share premium by treating the same as unexplained cash credit under section 68 - denial of natural justice - Held that:- A perusal of the assessment order passed by the Assessing Officer also shows that the reason for non-compliance to the notices issued under section 131 on the part of Mr. M.K. Kedia and Mrs. Sarita Devi Kedia, the then two directors of the assessee company was explained by them as due to change in address and a further opportunity was also sought by them in writing to comply with the requirements of the A.O. It appears from the order of the A.O. that he did not give such opportunity to Mr. M.K. Kedia and Mrs. Sarita Devi Kedia in spite of the fact that their examination was very crucial to decide the issue and a specific direction accordingly was given by the Ld. CIT in the order under section 263 to the A.O. to examine them on oath. The assessment under section 147/143(3)/263/143(3) was made by the A.O. without giving proper and sufficient opportunity of being heard to the assessee and without considering the relevant documentary evidence filed by the concerned share applicants in response to notices under section 133(6). Set aside the orders of the authorities below and restore the matter to the file of the A.O. with the direction to complete the assessment afresh - Decided in favour of assessee for statistical purpose.
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2018 (3) TMI 1457
Advance received against the unsold stock far exceeded the cost - Addition of advances were more than closing WIP - Held that:- AO had worked gross profit on work in progress which meant that the gross profit was determined from the expenses which was pending to be allowed. Without allowing corresponding expenses, the AO should not taxed the income portion of the transaction. A perusal of Schedule 7 reveal as to the current liability of Rs. ₹ 3, 18, 50, 717/- was explained. Both the departmental authorities did not consider the calculation or ignored it. There is no evidence that that the net advance was not ₹ 6, 70, 50, 365/-, as claimed by the assessee in the Schedule 7. The figure adopted by the AO/FAA at ₹ 3, 18, 50, 717/- under the head net advance was factually incorrect. If the net advance was of ₹ 6. 70 crores then same was lower than the closing WIP of ₹ 7. 31 crores. The sole basis of making the addition was that advances were more than closing WIP. Considering these facts we are of the opinion that matter needs further verification and correct appreciation of facts. It is true that principles of res judicata do not apply to income tax proceedings, but principles of consistency apply. So, if an AO wants to deviate from the path followed in the earlier year, he has to give reasons for it. We do not find any such reasons in the assessment order - the matter should be restored back to the file of the FAA for fresh adjudication Addition on account of variation in sale prices - Held that:- FAA, after considering the available material, held that even after considering the date of booking, there was inexplicable variations in the rate per square feet shown by the appellant. He referred to some of the sale transactions where variation in the rates was found. He observed that in several cases the rate per sq. ft. as per agreement was lower than stamp duty value, that large variations in rates indicated that sales realization was under reported, that the assessee was showing losses year after year. Finally, he upheld the additions, made by the AO, ‘in principle’. But, he directed the AO to consider only the additional area area and rate of ₹ 5040 sq. ft. stated in the agreement in two cases while computing the addition - we direct the FAA to decide the issue of addition made on account of variation in sale price of office premises afresh after hearing the assessee
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2018 (3) TMI 1456
Rectification of mistake - Rectificatory powers vested on the Tribunal under section 254(2) - Observations that actual use of loan by the appellant after borrowing it is not verified by the lower tax authorities - Held that:- This Tribunal cannot be a reviewing authority. We find that this Tribunal had considered all the aspects of the case before giving its finding. What the assessee seeks now is a review of the order. Assessee has not been able to show any mistake in the order of the Tribunal, much less any mistake apparent on record. The stand of the assessee is this that it was stop gap arrangement till the loan is disbursed by the financial institutions as stated by the assessee in Para 4 (ii) of the M. P. As per the assessment order, the entire discussion is about allowability of deduction u/s 57 and there is no whisper about nature of loan. There is no discussion on this aspect also as to whether loan was received from financial institutions and if received than when received and how utilised. As per the tribunal order, the matter is restored to AO for fresh decision after examining the facts of the present case in the light of the judgment rendered in the case of Comfound financial Services [2007 (12) TMI 519 - KARNATAKA HIGH COURT]. Hence, in our considered opinion, there is no apparent mistake in this tribunal order which can be rectified u/s 254 (2).
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2018 (3) TMI 1449
Exemption u/s 11 - religious purpose/charitable purpose - Assessee was not using its funds for public benefit but rather for the benefit of specified persons under Section 13(3) - Held That:- SLP dismissed. HC order confirmed [2017 (9) TMI 532 - DELHI HIGH COURT] Activities of the Assessee Society, though both religious and charitable, were not exclusively meant for one particular religious community. It was, therefore, rightly not denied exemption under Section 11 of the Act. - Decided against the revenue.
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2018 (3) TMI 1448
Disallowance of expenditure in respect of interest and administrative expenses under Section 14A - Disallowance of expenditure incurred towards foreign exchange gain - Held that:- SLP dismissed. HC order confirmed [2017 (5) TMI 1160 - GUJARAT HIGH COURT] HC has correctly held that the assessee was already having its own surplus fund and that too to the extent of ₹ 2319.17 Crores against which investment was made of ₹ 111.09 Crores, there was no question of making any disallowance of expenditure in respect of interest and administrative expenses under Section 14A of the Act, therefore, there was no question of any estimation of expenditure in respect of interest and administrative expenses of ₹ 54,39,916/= under rule 8D. For expenditure incurred towards foreign exchange gain the assessee had incurred loss in the same account in the earlier assessment years as well as subsequent assessment year and the treatment given by the assessee has been accepted. Therefore, the learned CIT [A] as well as the Tribunal has rightly deleted the disallowance made on account of foreign gain. - Decided against revenue.
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2018 (3) TMI 1447
Estimation of income - Determination of NPR - rejection of books for non-maintenance of stock register coupled with payment of expenses on self made vouchers - Held that:- The 8% NPR confirmed by the ld. CIT(A) was applied by the AO has observed (Para 4 of the assessment order) that the net profit rate shown by the assessee was 6.7%, whereas, actually, it was shown at 5.01%. Though the ld. CIT(A) took due note (impugned order, para 6.1) of this actual NPR shown by the assessee, he maintained the net profit rate of 8% as applied by the AO. Considering the past history in the assessee’s own case, the AO is directed to apply a net profit rate of 2.65% and the addition is directed to be reduced accordingly.
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2018 (3) TMI 1446
CIT(A) power in directing the AO (TDS) to re-examine the rectification petition of the assessee - Held that:- We note that though the Ld. CIT(A) has got the power to confirm, reduce, enhance or annul the assessment, the power to set aside/remand to the AO has not been given to the Ld. CIT(A), therefore, we set aside the order of Ld. CIT(A) and in the interest of justice, remand the matter to the file of the AO and direct the AO to de novo adjudicate the issues raised by the assessee in the rectification petition filed by the assessee u/s. 154 of the Act on 14.04.2011 untramelled by any observations given while explaining the facts - the assessee may be given adequate opportunity of being heard before passing the speaking order. Appeal of revenue is allowed for statistical purposes.
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Customs
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2018 (3) TMI 1445
Confiscation - mis-declaration of goods - suspicion was that the consignment may contain the goods fit for human consumption, which has not been declared while filing the bill of entry in order to evade higher custom duty and a mandatory no objection certificate of the FSSAI - Held that: - The issue raised by Revenue revolves on suspicion that these goods would be passed off as goods certified to be fit for industrial use/animal consumption but would be consumed in preparing sweets etc., which would be detrimental to the safety of those consuming them. It is on this basis that the samples were drawn and they were forwarded to the laboratory. The laboratory on examination of the same certified that the goods are an animal feed and not for human consumption. It is in these circumstances that consistent with the declaration of the assessee, the Tribunal concluded that factually the FSSAI certificate would not be necessary - In the light of the fact that consignment has not been misdeclared, there was no scope for any confiscation. Further the Tribunal posed a specific query to the Departmental Representative whether there was any prohibition for import of the goods for industrial use but to be consumed as animal feed, he could not point out anything beyond stating that they are not fit for human consumption. This definitely was not the answer to the query of the Tribunal. Appeal dismissed.
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2018 (3) TMI 1444
Attachment/freezing of Bank Account - Section 142 of the Customs Act, 1962 - smuggling of Gold - petitioner states that no show cause notice as yet has been issued. There is no crystalization of the amount due and payable to the Government - Held that: - If it is a serious allegation and made on oath before us, then, least we expected that by now a show cause notice to be issued, the petitioner's reply called for, an opportunity of personal hearing and an order of adjudication. Leave alone any adjudication order till date, no show cause notice is also issued to the petitioner. The Revenue prays for time to issue such a notice. We do not see how in these circumstances the Revenue justifies this act and prayed that bank account may be continued under attachment and then within a time frame show cause notice will be issued. Petition allowed - decided against Revenue.
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2018 (3) TMI 1443
100% EOU - debonding obligation - not achieving value addition - Whether the order of confiscation of the capital goods and imposition of penalty was fully justified in the facts and circumstances of the case? - Whether the Tribunal erred in law in setting aside the order of confiscation of the capital goods and imposition of the penalty against the respondent? - Held that: - It always remained open for the authority to refuse debonding and at the same time initiate action for payment of duty which the respondent was exempted at the time of import of capital goods for the EOU Unit. The resultant effect of allowing de-bonding and holding that value addition has been achieved by the respondent is that there was no willful attempt to evade duty by importing duty free goods for EOU without ever intending to operate and manufacture the goods in the EOU Unit. Once the element of intention to evade duty is absent and as a matter of fact there is no such allegation in the SCN, demand of duty, confiscation of capital goods and imposition of penalty ought not to have been fastened on the respondent. It is not a laconic order or perfunctory in that sense of the term which has not dealt with the facts and law applicable. Confiscation and penalty set aside - decided against Revenue.
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2018 (3) TMI 1442
Seizure of amounts lying to the credit of the petitioner's bank account - Held that: - Resultantly, the parties who are involved and allegedly in fraudulent transactions move this Court and complain as in this case that more than two years have lapsed, but, none of the Authorities have set the law in motion. This Court may then be inclined to release the bank account from seizure or an order of freezing the same - petition disposed off.
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2018 (3) TMI 1441
Mis-declaration of imported goods - pesticides/ insecticides /fungicides - Held that: - it appears that undoubtedly the appellant has mis-declared the imported goods as limestone powder instead of pesticides/ insecticides/ fungicides which attract higher rate of duty. The appellant was well aware about the contents of the container, because one of the container was already released. It appears that it is first offence of the appellant and he accepted his guilt before the lower authorities - Quantum of penalty reduced. Appeal allowed in part.
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2018 (3) TMI 1440
Concessional rate of duty - appellant has imported components at concessional rate of duty for manufacture of mobile phone and LED/LCD televisions at their factory in Uttarakhand - goods were rejected and cleared them as scrap - Held that: - these components have not been used for manufacture of the finished goods and hence, as per Rule 8 of the 1996 Rules, the demand was raised by the department. The goods were initially consumed and after assembly, tested and found defective, When the goods were not of the quality that can be re-exported so that it gets out of production. There was no provision under which the appellant can claim the benefit - appeal dismissed.
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2018 (3) TMI 1439
Application for change of name - jurisdiction - Held that: - it is observed that the inquiry was conducted by the Customs Department from the Income Tax Department of Mumbai, whereas the applicant's PAN was issued from Dehradun. Therefore, the inquiry made by the department is of no meaning as the same was not done with the appropriate authority. Change of name of Company is allowed - application allowed.
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Corporate Laws
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2018 (3) TMI 1438
Prayer seeking re-instatement of shares in the name of the first respondent by directing the appellant to rectify the register of members - Held that:- There is absolutely no material to hold that the first respondent was put on notice, received the option form as per approved scheme and the cheque sent. A fraud was committed against the first respondent though not by the appellant, but by some one acted on its behalf, resulting in registration of case in Crime No.57 of 1999 under Sections 406, 420 and 120 of IPC. It is also an admitted fact that the members of the first respondent was fraudulently changed. Hence, as rightly found by the Company Law Board, such a negligence on the part of the appellant cannot enure to its benefit as against the first respondent. The change of address of the first respondent was expressly unauthorised and illegal. The first respondent has taken a consistent stand throughout. It is not, as if, she has made the claim only after seeking escalation of the price of the shares. As rightly submitted by the learned Senior Counsel appearing for the first respondent, the Scheme, as approved by the Court cannot have an application to the person, who was not being issued with even the option form as a fraud has been committed against her. Thus, the abovesaid decision approving the scheme cannot have an application to the case of the first respondent. The concession given by the learned counsel and accepted by the Court has been made applicable to those shareholders, who expressed their desire to obtain shares. Thus, the aforesaid proceedings, as rightly held by the Company Law Board, cannot bind the first respondent. This Court does not find any complicated questions of fact involved. As discussed earlier, there is no dispute on primary facts. Though the proceedings before the Company Law Board is summary in nature, as no complicated questions of fact involved warranting a detailed trial on examination of parties, this Court is unable to accept the submissions made by the learned counsel appearing for the appellant in this regard. Company appeal dismissed.
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2018 (3) TMI 1437
Application for winding up - cheques dishonored - liability to pay the amount - Held that:- The financial accommodation/loan of ₹ 60 lakhs from the petitioner and as recorded in the letters dated July 17, 2013 and September 7, 2014 the respondent company was liable to repay the said amount to the petitioner together with the agreed rate of interest. In order to discharge its obligation, the company had issued two post dated cheques of ₹ 60 lakhs and ₹ 10,54,110/-, respectively both dated September 1, 2015 to the petitioner and when the petitioner presented the said cheques for encashment through its bank, the same were dishonoured on the ground of insufficient funds. Until receipt of the notice under Section 138 of the Negotiable Instruments Act, 1881 from the petitioner, the company did not inform the petitioner not to deposit any of the said two post dated cheques. Even in the affidavit in opposition, the respondent company has not disclosed any document whatsoever to suggest any oral agreement between the parties for adjustment of all the amount receivable by the petitioner against acquisition of any property at Kona, in the district of Howrah. For all these reasons, as find that the defence sought to be made out by the company in this application against the claim of the petitioner, lacks bona fide and the same has no merit. The application for winding up of the company is admitted for a sum of ₹ 73,95,617/- as mentioned in the notice dated December 1, 2015, under Section 434 of the Act of 1956, issued by the petitioner. The company is directed to pay the said sum of ₹ 73,95,617/- to the petitioner within a period of three weeks from date.
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2018 (3) TMI 1436
Oppression or mismanagement - illegal transfer of shareholding by Appellant no. 3 in favour of Appellant no. 2 - Held that:- The Respondent, by engaging in research devised products initially providing company to gain foothold in the market but that was expected of him as an employee of the status of Vice President who also held 5% shareholding. The contribution made by him for emergence of the company during its early days cannot be termed something for which he could expect a windfall. Finding recorded by learned NCLT to award ₹ 20 lakhs in favour of Respondent as a fair and reasonable amount in lieu of his professional qualification utilized during the initial days of establishment of Appellant no. 1 Company is unsustainable and cannot be supported. The claim set up by the Respondent for ‘Severance Pay’ of ₹ 26,75,000 in lieu of past services and as compensation for alleged unjustified termination is unsustainable and the same is to be rejected. We find ourselves in complete agreement with the learned NCLT in holding that nothing has been brought on record to establish that the transfer of shareholding by Appellant no. 3 in favour of Appellant no. 2 was not enforceable in law. No financial irregularity has been brought to our notice and there is no proof of oppression or mismanagement. There is nothing on record to arrive at a finding that the transfer of shareholding by Appellant no. 3 Company in favour of Appellant no. 2 Company was legally unenforceable. Contention raised on this count is accordingly repelled. There is no legal infirmity in the impugned order in so far as direction to Appellant no. 2 to accept the offer of transfer of 500 shares by the Respondent is concerned. As regards valuation, it has rightly been noticed by the learned NCLT that the valuation report dated 16th February 2015 has been drawn up merely for purpose of payment of stamp duty and not with the intention to determine the transfer price of shares. Be it seen that in terms of first valuation report dated 1st February, 2014 fair and reasonable price for transfer of shares was determined at ₹ 2064.74. Same was adopted by the concerned parties. In the face of same, the subsequent valuation report dated 16th February, 2015 has rightly been held as farce and undervalued to evade proper stamp duty. We accordingly find no infirmity in the finding recorded by learned NCLT that valuation report dated 1st February, 2014 at the rate of ₹ 2064.74 was to be taken into account for arriving at consideration amount of 500 shares to be transferred by the Respondent. This finding is accordingly upheld. This appeal is partly allowed. The impugned order is set aside to the extent of directing the Appellants to disburse ₹ 20 lakhs in favour of Respondent in lieu of his professional qualifications utilized during the initial days of establishment of Company. The impugned order is maintained in so far as direction to Appellant no. 2 to accept the offer of transfer of 500 shares by the Respondent at the rate of ₹ 2064.71 per share is concerned. Respondent is also held entitled to simple interest on the cost of such shares at the rate of 9% per annum from the date of impugned order. The appeal is disposed of in the aforesaid terms
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Insolvency & Bankruptcy
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2018 (3) TMI 1455
Initiation of Corporate Insolvency Resolution process - default in making repayment of the loan facility availed from the Bank on 31.05.2011 - Held that:- Referring to material papers filed by the petitioner, it is no doubt fact that the corporate debtor availed loan facilities from the Petitioner and thereafter defaulted in making repayment to the Petitioner Bank, therefore the only consideration left to be decided by this Bench is as to whether this claim is barred by limitation or not. This Bench being satisfied that the Petitioner furnished all the material papers reflecting existence of debt and default within limitation, and the name of the Resolution Professional proposed to act as Interim Resolution Professional, this Bench hereby admits this application
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2018 (3) TMI 1454
Bar of jurisdiction under Insolvency & Bankruptcy Code - action by District Disaster Management Authority sinking FDD - impact on the corporate debtors - Held that:- the subject matter involved in this case is not auction of the FDD but it is an action in progress in pursuance of the order given under the Disaster Management Act, 2005. When such an action being ordered, can anybody remain waiting until the Resolution Professional/Corporate Debtor take necessary steps to remove the sinking FDD from the Port. If for any reason, such salvage operations are put to stay in the light of the declaration of moratorium, what will happen if any grave occurrence taken place? Instead of applying equity, let us look into as to whether overriding effect and the moratorium directions given under Insolvency & Bankruptcy Code will have any bearing on the Disaster Management Act, 2005. In view of the legal position as on today existing, can it be construed that Insolvency & Bankruptcy Code, simply for the reason of later enactment, prevails over the Act of 2005? To our belief, it can’t be, because this Tribunal is barred to interfere with the jurisdiction exercised by the Collector of Goa. In the light of this background, we don’t even believe that we need to further clarify that operation of fields under both enactments is distinct and therefore overriding effect will not operate on the Act of 2005. Once jurisdiction itself is barred to this Adjudicating Authority under section 71 of the Act 2005, this Bench could not even look into the merits as to whether such order is right or wrong or into maintainability of the proceedings initiated or orders issued under the Act of 2005, let alone overriding effect of Insolvency & Bankruptcy Code on the Disaster Management Act, 2005. This Corporate Debtor has to go before Hon’ble High Court of Bombay-Goa by way of filing Writ Petition or by making its grievance in the Writ Petition already pending before the Hon’ble High Court of Bombay-Goa.
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Service Tax
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2018 (3) TMI 1432
CENVAT credit - trading activity - non-maintenance of separate accounts - Held that: - the appellant reversed the cenvat credit along with interest even before issue of show cause notice. As such, the matter could have been closed in terms of Section 73(3) of the Finance Act, 1994. It would appear that only because the credit period was spread over beyond the normal limitation, the Revenue took action of imposing penalty. There is a strong case for the appellant to have a reasonable cause of non-reversal of such disputed credit in time - penalty set aside - appeal allowed - decided in favor of appellant.
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2018 (3) TMI 1431
Waiver of pre-deposit - Franchisee Services - CENVAT credit - Rule 6(3)(c) of the CCR 2004 - invoices are not in the name of appellant/registered premises of the appellant - Held that: - whether the activity undertaken by the appellant falls under the category of Franchisee Services or not has been dealt by this Tribunal in the case of Radico Khaitan Limited Vs. CST [2016 (6) TMI 366 - CESTAT NEW DELHI] wherein it was held that the said service does not fall under the category of Franchisee Service - the appellant are not liable to pay service tax under the category of Franchisee Service and it is a case of complete waiver of pre-deposit of demand of service tax. CENVAT credit - Held that: - the appellant has not taken excess credit of 20% of their tax liability - also, M/s. Seagram Manufacturing Pvt. Limited in whose name invoices have been issued has merged with the appellant, therefore on that ground, Cenvat credit cannot be denied - Cenvat credit cannot be denied on the premise that address at which the invoices have been issued, is not a registered premise. In fact, the invoices have been issued in the name of appellant and who has received the services. Appellant has made out a prima-facie case for complete waiver of pre-deposit of entire demands confirmed against the appellant - pre-deposit waived - appeal allowed.
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2018 (3) TMI 1430
Refund of unutilized CENVAT credit - Place of Provision of services - appellants are engaged in providing of services to their client and the facilitating their clients for providing those services by third party. - intermediary services in terms of Rule 2(f) of Place of Provision of Rules, 2012 - reverse charge mechanism - Held that: - the appellant has provided the services to customers of their Client and having no direct nexus with the customers of their client has been provided by the appellant to their client and nowhere has facilitated or arranged for the services provided to their client by third party. Furthermore, the appellant has themselves provided the services to their client as the main service provider on principal to principal basis, therefore, the activity undertaken by the appellant do not qualify intermediary as defined in Rule 2(f) of Place of Provision of Services Rules, 2012. The appellant are not intermediaries in terms of Rule 2(f) of the Place of Provision of Service Rules, 2012. Therefore, the appellants are not liable to pay service tax being provider of service in India in terms of Rule 9 of the Place of Provision of Service Rules, 2012. Refund allowed - appeal allowed - decided in favor of appellant.
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2018 (3) TMI 1429
Reverse Charge Mechanism - GTA Service for the transportation services received by them - extended period of limitation - Held that: - the similar issue came up before this Tribunal in the case of Dinesh Chandra R. Agarwal Infracon Pvt. Ltd [2009 (10) TMI 395 - CESTAT, AHMEDABAD], where Tribunal hold that as whatever service tax would have been paid by the appellant the same was entitled to avail cenvat credit and the appellant was required to pay less service tax on their final services - the mala-fides against the appellant cannot be attributed, therefore, the extended period of limitation is not invokable - penalty set aside - appeal allowed.
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2018 (3) TMI 1428
Scope of Service Tax Act - State of Jammu and Kashmir - GTA Service - reverse charge mechanism - Held that: - provisions of service within the state of Jammu & Kashmir is beyond scope of Chapter No. V of the Finance Act, 1994. Therefore, no provision related to Service Tax Law is presently applicable to services rendered in the state of Jammu & Kashmir - appeal allowed - decided in favor of appellant.
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Central Excise
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2018 (3) TMI 1427
Compliance with pre-deposit - Section 35F of the Central Excise Act, 1944 - Held that: - In the matter of Suvidha Signs Studios Pvt. Ltd. v. Union of India [2016 (5) TMI 85 - DELHI HIGH COURT] the petitioner therein failed to comply with the statutory mandatory requirement of depositing the 7.5% of the demand of duty and penalty and therefore, the appeal of the petitioner therein was dismissed. Similar is the view taken in the matter of Pioneer Corporation v. Union of India [2016 (6) TMI 437 - DELHI HIGH COURT], where it was held that the jurisdiction of the High Court under Article 226 of the Constitution to grant relief notwithstanding the amended Section 35F cannot possibly be taken away, the Court is of the view that the said power should be used in rare and deserving cases where a clear justification is made out for such interference. Petition dismissed.
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2018 (3) TMI 1426
Non levy of penalty - section 80 of the Finance Act, 1994 - non-payment of tax for ignorance of law - Held that: - the appellant was under bonafide beleif regarding rate of service tax - the adjudicating authority was correct in coming to the conclusion that penalty, in these kind of matters wherein question of interpretation involved, does not arise and invoking the provisions of Section 80 is very correct and needs to be appreciated - appeal dismissed - decided against Revenue.
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2018 (3) TMI 1425
Pre-deposit - amendment to section 35 of the Central Excise Act - Held that: - considering the difficulties shown, we extend the time for depositing the amount as directed by the CESTAT - We extend the time to deposit the amount as directed by the CESTAT under the impugned order by six weeks from today. In case, the appellants deposit the amount within six weeks from today the order dismissing the appeals shall stand set aside - appeal disposed off.
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2018 (3) TMI 1424
Pre-deposit - Held that: - Considering that the debate with regard to validity of rule 8(3A) of the Central Excise Rules is not yet concluded and is sub-judice before the Apex Court and further considering the fact that the present appellants have deposited the defaulted amount in cash with interest after the impugned orders are passed, the impugned order is set aside - The CESTAT shall hear the appeals on their own merits filed by the present appellants without insisting for pre-deposit - appeal disposed off.
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2018 (3) TMI 1423
Interest - relevant date for calculation of interest - contention of the appellant is that appellant would be liable to pay interest after the order is passed in Original by the authority pursuant to the order of remand and not from the date the order in Original passed before remand - Held that: - Only because in the order of remand, the Tribunal did not record the words “set aside the order of adjudicating authority”, that would not mean that while remitting the matter, the Original order was intact - the decision in the case of BLUE STAR LIMITED Versus UNION OF INDIA [2009 (10) TMI 257 - BOMBAY HIGH COURT], where it was held that Setting aside an order means there is no order and party relegated for fresh adjudication. Stage of adjudication cannot be said to be determination. An adjudication will culminate in an order and such order would be determination and/or ascertainment of duty, and no interest is payable - appeal allowed - decided in favor of appellant.
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2018 (3) TMI 1422
Condonation of delay in filing appeal - approach to wrong forum - Held that: - the Section 14 of Limitation Act, 1963 have role to play as the applicants have approached to the wrong forum for taking the remedy against impugned orders - relying on the decision of the Hon'ble Apex Court in the case of Pasupati Overseas Pvt. Ltd. [1996 (3) TMI 133 - SUPREME COURT OF INDIA], we condone he delay in filing the appeals by allowing applications for condonation of delay - Petition allowed.
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2018 (3) TMI 1420
VCES Scheme - time limitation - CENVAT credit - denial on the ground that such discharge certificate is not one of the specified documents for the purpose of availment of credit under rule 9 of Cenvat Credit Rules, 2004 and as such credit cannot be allowed to them - Held that: - Having held that the said certificate was a proper document, the appellate authority should have allowed the credit instead of rejecting the part on the ground of time bar. If the assessee’s tax credit is on the basis of challan itself, the concurrence of the Revenue is not involved and it can be alleged that he deposited the tax and took the credit on his own without waiting for the final order of the acceptance by the proper authority. As such, it was necessary, under the scheme, to receive the discharge certificate before availing the credit, in which case, even limitation would not get involved. Appeal allowed - decided in favor of appellant.
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2018 (3) TMI 1419
CENVAT credit - delay of one day in filing the statement - the sole ground to deny self credit to the appellants by the Commissioner (Appeals) is that condition of para 2C(d) of the N/N. 56/2002-CE is required to be complied strictly - Held that: - a similar issue came up before this Tribunal recently in the case of Saraswati Agro Chemicals India Ltd. [2018 (3) TMI 263 - CESTAT CHANDIGARH], wherein this Tribunal examined the Notification No.01/2010-CE dt. 06.02.2010 and related conditions in para 5(d), 5(e) and 5(f) and held that condition 5(d) of the Notification No.01/2010-CE dt. 06.02.2010 is procedural in nature and for complying with the said condition with a delay cannot be fatal to the appellants. Condition 2C(d) is procedural in nature and for compliance with the said notification, delay of one day cannot be fatal to the appellant and the self credit taken by the appellants cannot be denied. Appeal allowed - decided in favor of appellant.
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2018 (3) TMI 1418
Dutiability - scrap generated during the course of fabrication of capital goods - Revenue is of the view that waste and scrap is an excisable item in terms of Note 8A of Section 15 of Central Excise Tariff Act, therefore, they are required to pay duty on the waste and scrap - Held that: - The waste has been generated on these items due to said activity - As the Hon'ble Apex Court held in the case of Grassim Industries ltd. [2008 (7) TMI 79 - HIGH COURT RAJASTHAN] that the said activity does not amount to manufacture. In that circumstances, in terms of Note 8A of Section 15 of the Central Excise Tariff Act, the appellant are not liable to pay duty - appeal allowed - decided in favor of appellant.
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2018 (3) TMI 1417
Scope of SCN - Refund claim - rejection on the ground of limitation u/s 11B of the CEA 1944, which was not a ground in the SCN - Held that: - time limitation was not a ground raised in the SCN - There is no discussion in the orders of both the lower authorities on the submission of the appellant on the issue of unjust enrichment and the documents submitted by the appellant to substantiate their claim. The matter requires re-examination by the adjudicating authority in terms of SCN dt.25.6.2015 - appeal allowed by way of remand.
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CST, VAT & Sales Tax
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2018 (3) TMI 1416
Whether in absence of any assessment order passed in the original proceeding under Section 21(7) of the VAT Act, the assessing officer has power and jurisdiction to reassess the said deemed reassessment by resorting to reassessment proceeding under Section 22(1) of the VAT Act and further the consequential question would be, whether in that case, the assessing officer is justified in levying penalty under Section 22(2) of the VAT Act? Held that: - “order of assessment” employed in Section 22(1) of the VAT Act clearly denotes that there must be formal adjudication by the assessing officer after taking into account the return and statutory compliances and the documents furnished by the petitioner - In order to attract Section 22(1) of the VAT Act, there must be order of assessment made by the assessing officer in contradistinction to Section 21(2) which is a deemed assessment and which in case of the petitioner, it has been done is a legal fiction. The legislature is quite competent to create a legal fiction, in other words, to enact a deeming provision for the purpose of assuming existence of a fact which does not really exist. In sum and substance, in order to invoke jurisdiction under Section 22(1) of the VAT Act or to initiate proceedings for reassessment there must be an order of assessment duly passed by the assessing officer and it must be in existence as a condition precedent to invoke Section 22(1) and the limitation prescribed is five calendar years from the date of commencement of such proceedings, whereas the deemed assessment order under Section 21(2) is only reassessable under Section 21(3) of the VAT Act within one calendar year from such year. In case there is no order of assessment passed under Section 21(7) of the VAT Act, it cannot be subject to reassessment proceeding under Section 22(1) of the VAT Act. Penalty - whether the penalty imposed invoking Section 22(2) of the VAT Act is sustainable? - Held that: - it has already been held that there is no order of assessment as the assessing officer did not pass any assessment order and thus, there is failure on the part of the assessing officer to pass the original assessment order. For the reason that the order of reassessment is to be held without jurisdiction and without authority of law, therefore, the order imposing penalty passed upon reassessment cannot stand and accordingly, it deserves to be quashed. Order of assessment quashed - petition allowed.
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2018 (3) TMI 1415
Validity of assessment order - Held that: - Having admitted the mistake, the respondent could not have proceeded further, without making proper proposal, he proposed to proceed with the assessment on totally different lines. This mistake committed by the respondent goes to the root of the mater, affecting the very orders of assessment. This is sufficient to hold that the impugned orders are bad in law, as they have exceeded the proposal in the Revision Notices, dated 14.11.2016, and without due application of mind - Petition allowed.
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2018 (3) TMI 1414
Validity of assessment order - scope of SCN - input tax credit - Held that: - the assessment order was passed based on facts, of which the petitioner was not informed in the show-cause notice issued to them earlier - The first respondent shall issue a notice afresh in Form VAT 305-A; give the petitioner an opportunity of being heard, and an opportunity of oral hearing; and, thereafter, pass a fresh assessment order in accordance with law at the earliest - petition disposed off.
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2018 (3) TMI 1413
Rejection of appeal for non-compliance - default pointed out by the Additional Commissioner in the appeal was that the entire amount assessed was not deposited and the appeal also has been filed at a belated stage after about 5 months delay - Held that: - this Court is of the opinion that ends of justice would meet if the Petitioner is granted one more opportunity to appear before the Additional Commissioner and satisfy the Additional Commissioner in appeal which is pending before the Additional Commissioner pertaining to Annexure P-1, subject to the Petitioner being penalized by paying a cost of ₹ 10,000/- to be deposited in the office of the Commercial Tax Department - petition disposed off.
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2018 (3) TMI 1412
Concessional rate of tax - supplies effected to the Unit run canteens - It is the stand of the petitioners in the writ petition that, as per the statutory provisions, the benefit of concessional rate of tax is applicable, not only in respect of supplies effected to the Canteens Stores Department, but also in respect of supplies effected to the Unit run canteens of the Military, Navy and Air Force - Held that: - taking note of the distinction between a sale effected directly to the Canteen Stores Department and sales effected directly to Unit-run canteens of the Military, Navy, Air force etc., the State Government decided to depart from the earlier practice of granting concessional rate of tax even in respect of supplies effected to Unit-run canteens and confined the benefit of concessional rate of tax only to supplies effected to the Canteen Stores Department. The amendment, however, was to take effect only from the assessment year 2014-15, and for the prior period, it was felt not necessary to interfere with the benefit of concessional rate of tax, that was already extended to unit run canteens. The assessing Authority has not taken note of this amendment, which came into effect only from the assessment year 2014-15, and appears to have applied the rationale of the amended provision to even the earlier assessment years up to, but not inclusive of the assessment year 2014-15 - the assessment orders impugned in all these writ petitions, inasmuch as they pertain to assessment years 2011-12, 2012-13 and 2013-14, must necessarily be quashed. As regards 17209/2017, Ext.P3 assessment order, that is impugned in the said writ petition, pertains to the assessment year 2014-15, and the interpretation to be placed on the provisions of the 5th proviso to Section 6(1), is as indicated in this judgment. It is made clear that, in the said case, the petitioner will not be entitled to the benefit of the concessional rate of tax in respect of supplies effected to Unit-run canteens. Petition disposed off.
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Indian Laws
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2018 (3) TMI 1435
Validity of Arbitral Award - time limitation - Section 34 of the Arbitration and Conciliation Act, 1996 - Whether Anilkumar Patel represented his family in the arbitration proceedings and whether respondents are right in contending that receipt of copy of award by Anilkumar Patel was for himself and on behalf of his family members? Held that: - Section 34(3) provides that an application for setting aside an award shall not be entertained by the court if it is made after three months have elapsed from the date on which the applicant had received the arbitral award. The proviso to Section 34 further provides that if the court is satisfied that the applicant was prevented by sufficient cause from making the application within the prescribed time, it may entertain the application within a further period of thirty days 'but not thereafter' - Proviso to Section 34 gives discretion to the court to condone the delay for a sufficient cause, but that discretion cannot be extended beyond the period of thirty days, which is made exclusively clear by use of the words 'but not thereafter'. Service of arbitral award on Anilkumar Patel amounts to service on the other appellant Nos.1(a) to 1(d) and respondent No.10 and they cannot plead non-compliance of Section 31(5) of the Act. Anilkumar Patel has gone to the extent of even disputing his signature in the award dated 07.07.1996 by drafting choreographed petition. Having accepted the award through Anilkumar Patel, being the head of the family, appellant Nos. 1(a) to 1(d) and respondent No.10 cannot turn round and contend that they had not received the copy of the award. The application filed under Section 34 of the Act by Anilkumar Patel and appellant Nos. 1(a) to 1(d) and respondent No.10 was barred by limitation - appeal dismissed.
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2018 (3) TMI 1434
Whether prior sanction for prosecution qua allegation of corruption in respect of a public servants is required before setting in motion even the investigative process under Section 156(3) of the Code of Criminal Procedure, 1973? Held that: - Merely because the appellant has roped in respondent No.1 in the complaint is not sufficient ground to allow his name to be included as such. The complaint is categorical, the role of Secretary, PHED and the Principal Secretary has been questioned. That is the mindset with which the complainant knocked the doors of the criminal courts - There was no allegation in respect of any role played by the Secretary/Principal Secretary to the Chief Minister. It cannot be said to be a mere mis-description of name, which can be corrected. It cannot be the stand of the appellant that willy-nilly somehow, respondent No.1 must remain arrayed as an accused in those proceedings, even though the proceedings before the Magistrate are at the stage of only whether there should be a direction for investigation or not. It is not that every officer in the Government has to be arrayed in respect of any role performed or not. The mere presence in one meeting of respondent No.1 and that too when he was not a signatory and really had no role to play in that capacity, as apparent from the minutes, cannot be now used to justify his name being included as an accused. This is clearly an afterthought. It is not for the appellant to question as to which officer should or should not be present. Respondent No.1 needs to be struck off from the array of parties both in the present proceedings and consequently in the complaint - if a situation arises where investigation is directed u/s 156(3) of the Cr.P.C. and some material comes to light to array respondent No.1 as an accused, our order would not come in the way. The matter is referred to a larger Bench - application allowed.
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2018 (3) TMI 1433
Maintainability of petition - Jurisdiction of Court - Compliance with Sec 2(2) of Cost and Works Accountants Act 1959 as amended - petition prayed that the acronym ICOAI be used instead of acronym ICAI which belongs to the third respondent - The first respondent changed their website from ICWAI to ICAI and started representing themselves as ICAI in all its communication with print and electronic media, blatantly misrepresenting to the stake holders by using the acronym ICAI. Whether this Court by exercising the jurisdiction under Article 226 of the Constitution of India need to go into the dispute with regard to the usage of acronym "ICAI" by both the first and third respondents, especially, when it is an admitted fact that the third respondent themselves have admitted in their counter affidavit that the Trade Mark for the acronym "ICAI" was registered under the Trade Marks Act, 1999 and the Certificate of Registration of Trade Mark dated 11.09.2016, was issued to them to that effect? Held that: - the above question is to be answered in negative and it is held that the third respondent, who sails with the petitioner, has to seek their remedy before appropriate forum by filing appropriate proceedings arising out of infringement of Registered Trademarks or passing off action, if any, as the writ jurisdiction is not the appropriate one, more particularly when the petitioner is not an aggrieved person even. There can be no difficulty in holding that till the name of the first respondent is changed as proposed by them, as stated supra, if they continue to use the acronym "ICAI" and if the third respondent is aggrieved against such usage in view of the registration of such trademark by the third respondent in their favour as discussed supra, certainly, it is for the third respondent to initiate appropriate legal action before the appropriate forum by filing appropriate application under the Trademarks Act - certainly the present writ petition cannot be maintained that too, at the instance of the petitioner, who is only a member of the third respondent more particularly, when the third respondent has not chosen to challenge such alleged infringement before the competent Court of law so far. Needless to state that the Trademark right is a proprietary right and therefore only such owner of the Trademark, if aggrieved against any infringement of such trademark, has locus standi and consequently a cause of action to initiate appropriate proceedings before the appropriate forum against such infringement and to seek the appropriate relief thereunder. Such proprietary right of trademark is a right in personam and not a right in rem. Therefore, the petitioner, though a member of the third respondent, cannot be called as an aggrieved person, even to initiate the proceedings before such appropriate forum against the alleged infringement. The writ petition fails and the same is dismissed only on the ground of maintainability.
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