TMI Tax Updates - e-Newsletter
April 11, 2022

Case Laws in this Newsletter:

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

Articles

1. E-INVOICE UNDER GST

   By: NIRMALA RANAWAT

News

1. Centre creates matrix for 50 agricultural products with good export potential to help boost agri exports

2. Auction for Sale (Issue/Re-issue) of (i) ‘4.56 % GS 2023’, (ii) ‘New GS 2029’, (iii) ‘6.54% GS 2032’ and (iv) ‘6.95% GS 2061’

3. Shri Piyush Goyal has called upon the Indian community in Australia to celebrate the International Day of Yoga on 21st June at 75 iconic locations in Australia to mark the 75th Anniversary of India’s Independence

4. Insolvency and Bankruptcy Board of India amends the Insolvency and Bankruptcy Board of India (Voluntary Liquidation Process) Regulations, 2017

Notifications

Companies Law

1. G.S.R. 291 (E) - dated 8-4-2022 - Co. Law

Companies (Incorporation) Amendment Rules, 2022

GST - States

2. F.12(15) FD/Tax//2022-136 - dated 7-4-2022 - Rajasthan SGST

Corrigendum - Notification No. F.12(15) FD/Tax/2022-132, dated the 31st March, 2022

Law of Competition

3. L-3(2)/ Regl- Gen. (Amdt.)/ 2022/ CCI - dated 8-4-2022 - Competition Law

Competition Commission of India (General) Amendment Regulations, 2022

Money Laundering

4. S.O. 1702 (E) - dated 8-4-2022 - PMLA

RBI permits the reporting entities to perform authentication

SEZ

5. S.O. 1720 (E) - dated 8-4-2022 - SEZ

Central Government de-notifies an area of 16.28 hectares, thereby making resultant area as 97.785 hectares at SIPCOT Industrial Area, Sriperumbudur in the State of Tamil Nadu

6. G.S.R. 288 (E) - dated 8-4-2022 - SEZ

Special Economic Zones (Amendment) Rules, 2022

Highlights / Catch Notes

GST

• Court Orders Return of Seized Goods and Vehicle After GST Registration Address Updated; No Tax Evasion Found.

  Case-Laws - HC : Seizure of goods alongwith vehicle - place of supply was not included in the GST registration - oth the petitioner and the respondent admit that as on date the above said address has been included in the petitioner's place of business in the GST Registration. Thus, there is a post facto inclusion of the address, which was mentioned in the tax invoice raised by the supplier and in the E-way Bill. - There is no attempt to evade tax - HC
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• GST Act: Applicant's Received Amount is Taxable Supply Value, Includes Incidental Expenses Like Commission and Packing Charges.

  Case-Laws - AAR : Valuation of Supply - the amount received by the applicant in this regard shall form a part of the value of supply on which tax shall be levied in terms of sub-section (1) of section 9 of the GST Act. The value of supply, as per clause (c) of sub-section (2) of section 15, shall include ‘incidental expenses, including commission and packing, charged by the supplier to the recipient of a supply and any amount charged for anything done by the supplier in respect of the supply of goods or services or both at the time of, or before delivery of goods or supply of services.’ - AAR
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• Medicare's Bio-medical Waste Service Exempt from GST as "Pure Services" Under Indian Constitution Articles 243G/243W.

  Case-Laws - AAR : Exemption from GST - pure services or not - Appointment of Medicare as a sub-contractor with the work of collection and disposal of bio-medical waste for the zones concerned - The services provided by the applicant for the collection and disposal of bio- medical waste from various clinical establishments is found to be a matter as listed in the Eleventh and/or Twelfth Schedule in relation to functions entrusted to a Panchayat under article 243G and/or to a municipality under article 243W of the Constitution of India. - AAR
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• Second Bail Denied for Accused in Wrongful ITC and Fake Invoice Case; Ongoing GST Evasion Investigation Continues.

  Case-Laws - DSC : Maintainability of second bail application - Seeking grant of bail - availment of wrongful ITC - outward supply by issuing fake invoices - In the absence of any changed circumstances and in view of the fact that prima facie case is made out for alleged GST evasion of a high magnitude on the part of the applicant and as the investigation is still underway, the applicant cannot be released on bail - DSC
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Income Tax

• Court Extends Deadline for JAO to Address Objections in Section 147 Assessment Reopening; Requires Personal Hearing Notice.

  Case-Laws - HC : Reopening of assessment u/s 147 - mandation of final assessment order after the Jurisdictional Assessing Officer (JAO) disposed the objections - Time for the JAO to dispose petitioner’s objections, if any, is extended by further period of four weeks from today. At the cost of repetition, it is directed that the JAO shall consider all submissions being made by petitioner and grant a personal hearing with atleast seven days advance notice. - HC
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• Delay in Final Order: Justice Requires Halting Recovery Proceedings Until Appeal is Resolved.

  Case-Laws - HC : Stay of demand when the appeal is pending consideration - As already more than 18 months have elapsed since the petitioner was directed by the respondents to upload the hearing note which it had in fact done, and even after that, the respondents failed issue the final order in the appeal, interests of justice demands that recovery proceedings ought not to be pursued in the meantime. - HC
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• Restrictive Covenant Payments Classified as Non-Taxable Capital Receipts, Exempt from Taxation.

  Case-Laws - AT : Characterization of receipts - nature of receipts - compensation received as consideration for restrictive covenant to not to do business in the same line for a prescribed period - The amount being in nature of a “capital receipt” was not exigible to tax. - AT
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• Assessee's Circulation Audit Not Commercial; Exemption u/s 11 Allowed Despite AO's Business Activity Claim.

  Case-Laws - AT : Exemption under section 11 - As per AO assesseee’s activity of conducting circulation audit was clearly a business activity for which consideration in the form of membership subscription and one time entrance fees was received - Merely came into existence of provision of Section 2(25) of the Act nowhere makes the object of the Assessee commercial in nature. Instances of business and profession are also not on record. Taking into account all the facts and circumstances of the case, we are of the view that the CIT(A) has wrongly denied the claim of the assessee u/s 11 of the Act which is liable to be allowed in the interest of justice. - AT
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• Assessing Officer instructed to grant tax exemption u/s 12A despite previous claim u/s 10(23C) due to error.

  Case-Laws - AT : Exemption u/s 11 - Since the assessee has been claiming exemption u/s.10(23C) in the earlier years therefore during the year under consideration there is high probability that assessee again claimed exemption u/s.10(23C) by overlooking the fact that it had already got registration u/s.12A of the Act which in any case was available with the assessee before the filing of return of income. The mistake has occurred as a human error and should have been judicially considered - we direct the Assessing Officer to allow the exemption to the assessee u/s.12A of the Act in accordance with law - AT
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• Reassessment Notice u/s 148 Violates Natural Justice by Denying Assessee Opportunity to Contest Reopening.

  Case-Laws - AT : Reassessment u/s. 147 vide notice of u/s. 148 - As per the settled law, the Assessing Officer should have given opportunity to the assessee to contest the reopening and file objections against the reasons recorded. However, in this case, the reopening was done on the last date of limitation period, therefore, no opportunity to file objections has been granted to the assessee which violates the principles of natural justice. - AT
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• Trust's Donations Assessment Challenged: Procedural Violations and Breach of Natural Justice Highlighted in Inquiry Process.

  Case-Laws - AT : Assessment of trust - donation in corpus fund and in non-corpus fund - The addition stood made without confronting the assessee in this regard and thereby violating the basic principles of natural justice and basing the assessment order on the enquiry conducted at the back of the assessee. - it cannot at all be said that the ld. CIT(A) deleted the addition merely on the basis of the affidavit submitted by the assessee - AT
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• Owning a House Doesn't Disqualify Deduction u/s 54 for LTCG if Investing in New Property.

  Case-Laws - AT : LTCG - Deduction u/s 54 - Profit on sale of property used for residence - assessee was already in the possession of the residential house at the time of purchase of the new house - The assessee cannot be denied the benefit of the deduction provided under section 54 of the Act if he has a house at the time of transfer of the property and makes the investment in another residential property. Accordingly, the finding of the authorities below is devoid of any merit. - AT
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Customs

• Court Confirms DRI's Authority as "Proper Officer" to Issue Show Cause Notice Under Customs Act Section 28(1.

  Case-Laws - HC : Validity of SCN - Jurisdiction - Proper Officer or not - whether by virtue of the notifications dated 07.07.1997, 07.03.2002 and 06.07.2011, the DRI would have the authority to act under Section 28 of the Customs Act - The show cause notice under Section 28(1) could be issued by the “Proper Officer”. A “Proper Officer” is one, who is defined in Section 2(34) as the officer of Customs, either by the Board or by the Commissioner of Customs, who is assigned specific functions - the Respondent No.2 had the jurisdiction to issue impugned show cause notice. - HC
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• Court Orders Unconditional Release of Goods Under Customs Act Section 110 Due to Delay in Issuing Show-Cause Notice.

  Case-Laws - AT : Seeking provisional release of goods - Revenue found it necessary to insist upon additional security deposit - Section 110 of Customs Act, 1962 mandates release of goods within six month from the date of seizure unless show-cause notice proposing confiscation has been issued or, on compliance with prescribed procedure, within further six months. The pendency of appeal against the terms of release does not alter the prescription therein. - The retention of goods, not validated by issue of notice, is not tenable in law and must, in accordance with the law, be released unconditionally to the appellant. - AT
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Indian Laws

• Court Upholds Promissory Note Validity; Presumption of Consideration Confirmed Despite Execution Dispute in Cheque Dishonor Case.

  Case-Laws - HC : Dishonor of Cheque - application of presumption, when execution of the so called pro-note is not admitted - Merely because the plaintiff advanced loan to the defendant on various dates and the defendant executed the pronote subsequently in recognition of his liability, it cannot be said that the pronote is not supported by consideration. There is no difficulty in accepting the legal position that a statutory presumption is always rebuttable - However, in the present case, the plaintiff has taken meticulous efforts to prove the transaction. - HC
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Service Tax

• Court Rules No Suppression of Facts in Photo Processing Tax Case; Extended Limitation Period Not Justified.

  Case-Laws - AT : Extended period of limitation - Classification of services - processing and printing photograph from the negative supplied by their client - the issue involved is interpretation of law. - The suppression of fact cannot be alleged against the appellant. - AT
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Central Excise

• CENVAT Credit: Proportionate Reversal Allowed Despite Non-Filing Declaration if Department Has Necessary Info.

  Case-Laws - AT : CENVAT Credit - common inputs and input services which have been used in the manufacture of dutiable and exempted goods - even if the details were not declared in the prescribed form but the details are otherwise required to be declared in the form are otherwise available with the department, therefore, mere non filing of declaration cannot be the reason that the appellant’s option for the proportionate reversal is not available. - AT
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• CENVAT Credit Allowed for Electricity Expenses at Head Office if Supporting Factory Operations, Regardless of Location.

  Case-Laws - AT : CENVAT Credit - Input Services - services of electricity expenses in connection with their head office - The location of the head office is immaterial so long it is used only for the operation of the factory’s activities, therefore, any service received in head office is in relation to the manufacturing activity of the appellant. - even though the input service was received by the head office but since it is in connection with overall business activity of the manufacturing unit, the credit is admissible - AT
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Case Laws:

• GST

• 2022 (4) TMI 469
  Levy of GST and Service Tax - royalty payable to the Government on mining of minerals - HELD THAT:- In view of the interim orders passed by the coordinate Bench of this Court in M/S A.D. AGRO FOODS PRIVATE LIMITED VERSUS UNION OF INDIA [ 2021 (12) TMI 656 - ALLAHABAD HIGH COURT] , it is found that the petitioner has made out a case for interim relief. - Stay Granted. Let counter affidavit be filed by the respondents within three weeks. Petitioner shall have a week thereafter to file rejoinder affidavit - List after expiry of four weeks before the appropriate Bench along with Writ Tax No.475 of 2021 and other similar writ petitions.

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• 2022 (4) TMI 467
  Cancellation of GST registration of petitioner - ex-parte order was passed - violation of principles of natural justice - HELD THAT:- On bare perusal of the the contents of the show cause notice as well as the impugned order, it is found that the said SCN is absolutely vague, bereft of any material particulars and the impugned order is also vague and a nonspeaking order. The impugned order dated 22.02.2022 is set aside and matter remitted to the respondent No.2 for denovo proceedings in accordance with law. Petition allowed by way of remand.

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• 2022 (4) TMI 466
  Seizure of goods alongwith vehicle - place of supply was not included in the GST registration - seizure on the ground that the address of the Consignee mentioned as No.5/150, South Karumpattor, South Thamaraikulam, Kanyakumari, Tamil Nadu 629708, was not a place mentioned in the GST Registration of the petitioner - HELD THAT:- Both the petitioner and the respondent admit that as on date the above said address has been included in the petitioner s place of business in the GST Registration. Thus, there is a post facto inclusion of the address, which was mentioned in the tax invoice raised by the supplier and in the E-way Bill. There is no attempt to evade tax - petition allowed.

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• 2022 (4) TMI 465
  Seeking release of goods alongwith the vehicle (without demanding any security) - final order challenged by way of an appeal under Section-107 of the Act - Section 129 and Section 130 of the GST Acts - HELD THAT:- We are inclined to pass an interim order so far as the vehicle is concerned. It appears that the total liability of the writ-applicant no.2 as the owner of the conveyance has been determined to the tune of Rs. 1,94,012/- - If the writ-applicant deposits the amount of Rs. 1,94,012/- [Rupees One Lakh Ninety Four Thousand Twelve Only] with the authority concerned, then his truck shall immediately be released and handed over to him. Rule returnable on 13.06.2022.

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• 2022 (4) TMI 464
  Valuation of Supply - Superior Kerosene Oil (SKO) made by the applicant for domestic purposes to fair price dealers in terms of the license granted by the Director of Consumer Goods, Government of West Bengal - HELD THAT:- The license in FORM-B granted by the Director of Consumer Goods, Government of West Bengal has been issued under Paragraph 5 of the West Bengal Kerosene Control Order, 1968. The applicant has been licensed as an Agent to sell P.D.S. Kerosene from authorized depot at an approved selling price to the Dealers and Permit Holders as directed by the Licensing Authority. The status of the applicant, therefore, undisputedly appears to be an Agent who has been licensed to sell P.D.S. Kerosene to the Dealers and Permit Holders - the applicant has executed an agreement with the Oil Marketing Company namely Indian Oil Corporation Limited and has been granted a license under paragraph 5 of the West Bengal Kerosene Control Order, 1968 to carry on trade in Kerosene and thus the applicant satisfies all the conditions to qualify to be an agent . Whether an agent can be regarded as a fair price shop or not. It appears that a fair price shop is licensed to sell public distribution commodities against ration documents i.e., a fair price shop supplies S.K.Oil, along with other public distribution commodities, to the ration card holders only? - HELD THAT:- The applicant cannot be regarded as a fair price shop . Since the entry serial number 11A of Notification No. 1498-FT dated 22.08.2017 [Central Notification No. 21/2017-Central Tax (Rate) dated 22.08.2017] specifically refers supply of services provided by Fair Price Shops (FPS) and the applicant doesn t qualify to be a fair price shop , the applicability of the other aspects of the supply as referred to in the said entry are not discussed, i.e., (i) whether the applicant is supplying services to State Government or (ii) whether the applicant receives consideration in the form of commission or margin - the observation of the officer concerned from the revenue, cannot be accepted that the applicant is merely recovering the commission which he is eligible to earn from the IOCL in his capacity of an agent . In the instant case, the applicant admittedly charges, other than price of kerosene, commission, transportation charges, stationery charges, compensation on handling evaporation loss, to the recipient of goods i.e., dealers which are permitted / approved by the Director of Consumer Goods, Department of Food and Supplies, Government of West Bengal - the other elements involved in the instant supply shall not qualify for exemption. Therefore, the amount received by the applicant in this regard shall form a part of the value of supply on which tax shall be levied in terms of sub-section (1) of section 9 of the GST Act. The value of supply, as per clause (c) of sub-section (2) of section 15, shall include incidental expenses, including commission and packing, charged by the supplier to the recipient of a supply and any amount charged for anything done by the supplier in respect of the supply of goods or services or both at the time of, or before delivery of goods or supply of services. The aforesaid clause thus clearly specifies that in respect of supply of goods, any amount charged for anything done by the supplier at the time of, or before delivery of goods shall be a part of the value of supply.

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• 2022 (4) TMI 463
  Exemption from GST - pure services or not - Appointment of Medicare as a sub-contractor with the work of collection and disposal of bio-medical waste for the zones concerned - Applicability of entry Sl. No. 3 of Notification No. 12/2017 Central Tax dated 28/06/2017 and Sl. No 3 of Notification No. 12/2017 State Tax (Rate) dated 28/06/2017 to contractor and sub-contractor of the applicant or not - Entry Number 75 of Notification No. 12/2017 Central Tax (Rate) dated 28/06/2017 and Entry No 75 of Notification No. 12/2017 State Tax (Rate) dated 28/06/2017 are applicable to the sub-contractor of the applicant or not. Whether the provisions of Entry Number 3 of Notification No. 12/2017-Central Tax (Rate) dated 28/06/2017 and Entry No 3 of Notification No. 12/2017 State Tax (Rate) dated 28/06/2017 are applicable to the applicant or not? - HELD THAT:- In the instant case, the applicant has entered into the agreement with State Government for the collection and disposal of bio- medical waste from various clinical establishments and for which, State Government is liable to pay the consideration to the applicant. So, there can be no dispute that the applicant is supplying the services to State Government. In fact, the applicant himself has admitted the same - since Medicare raises invoices on the applicant for the work done by it as a sub- contractor and the applicant is liable to pay the consideration to Medicare, admittedly it is a supply by the sub-contractor to main contractor i.e., supply of services by Medicare to the applicant. The functions entrusted to a Panchayat as listed in the Eleventh Schedule include the functions like Health and sanitation, including hospitals, primary health centres and dispensaries . Further, the functions entrusted to a municipality as listed in the Twelfth Schedule includes Public health, sanitation conservancy and solid waste management . According to Cambridge Dictionary, sanitation means the systems for taking dirty water and other waste products away from buildings in order to protect people s health . Further, sanitation and similar services (Group: 99945) falls under Heading 9994: Sewage and waste collection, treatment and disposal and other environmental protection services. Furthermore, Government of West Bengal floated the Request for proposal (RfP) for selection of Common Bio Medical Waste Treatment Facility ( CBMWTF ) Operators for Public Health Facilities in West Bengal. The services provided by the applicant for the collection and disposal of bio- medical waste from various clinical establishments is found to be a matter as listed in the Eleventh and/or Twelfth Schedule in relation to functions entrusted to a Panchayat under article 243G and/or to a municipality under article 243W of the Constitution of India. Whether the provisions of Entry Number 3 of Notification No. 12/2017 Central Tax(Rate) dated 28/06/2017 and Entry No 3 of Notification No. 12/2017 State Tax (Rate) dated 28/06/2017 are applicable to the sub-contractor of the applicant or not? - Whether the provisions of Entry Number 75 of Notification No. 12/2017 Central Tax (Rate) dated 28/06/2017 and Entry No 75 of Notification No. 12/2017 State Tax (Rate) dated 28/06/2017 are applicable to the sub-contractor of the applicant or not? - HELD THAT:- No ruling can be given these questions since the applicant is recipient of services in respect of supplies involved in the these questions.

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• 2022 (4) TMI 462
  Maintainability of second bail application - Seeking grant of bail - availment of wrongful ITC - outward supply by issuing fake invoices - HELD THAT:- Same grounds are repeated in the second bail application. The Judgments cited on behalf of the applicant while deciding the previous bail application are being pressed in while supporting the second bail application. Factually, no new grounds or facts warranting consideration of second bail application are mentioned in the application. There is no material change in the circumstances and therefore, the present bail application is not maintainable. Merely because the accused continue to be in custody after rejection of previous bail application, the second bail application filed within six days of rejection of previous bail application without any new grounds, cannot be said it to be maintainable. The learned counsel for the applicant has also relied upon a Judgment of the Hon ble Bombay High Court in TASNEEM RIZWAN SIDDIQUEE VERSUS THE STATE OF MAHARASHTRA AND ORS. [ 2018 (3) TMI 1690 - BOMBAY HIGH COURT] to support his contention that bail has to be granted for non compliance of Section 41A of Cr.P.C. I however, find that no such proposition is laid down by the Hon ble Bombay High Court in the cited Judgment. In fact, release of petitioner s husband from custody was directed in habeas corpus petition on finding that the arrest of the petitioner s husband was made prior to the date fixed for appearance by notice under Section 41A of Cr.P.C. In the absence of any changed circumstances and in view of the fact that prima facie case is made out for alleged GST evasion of a high magnitude on the part of the applicant and as the investigation is still underway, the applicant cannot be released on bail - bail application dismissed.

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• 2022 (4) TMI 417
  Blocking of input tax credit - Rule 86 A of the C.G.S.T. /U.P. G.S.T. Rules, 2017 - HELD THAT:- From perusal of Rule 86 A(2) of the C.G. S.T./U.P. G. S.T. Rules, 2017, and the guidelines of the Commercial Tax vide Letter No.GST/2021-22/ 30 / Commercial Tax, it is opined that the petitioners should first approach the authorised Officer raising objections against the blocking of the input tax credit and the said authority would be under an obligation to decide the objection within a time bound period. Petition disposed off.

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• 2022 (4) TMI 416
  Denial of Input Tax Credit - transition of credit, at the time of making new firm - denial of credit on the ground that the amount was not reflected in the monthly return filed for the month of June 2017 - opportunity of hearing not given to petitioner - violation of principles of natural justice - HELD THAT:- The question that has to be answered is whether credit which was lying unutilised in the hands of M/s.Arun Structurals, which had TIN No.33604100485 and whether the above said credit could have been transferred in the name of the petitioner also called M/s.Arun Structurals with new TIN No.33886477864 on 10.04.2017. If the above said credit could be validly transiting from M/s.Arun Structurals, bearing TIN No.33604100485 or M/s.Arun Structurals with new TIN No.33886477864 [the petitioner herein], I do not see why the credit should not be allowed to the petitioner. The impugned order has been passed without following the principles of natural justice and therefore, it is liable to be quashed. It is also noticed that the attempt of the respondent is to deny the input tax credit which remained unutilised from the month of April 2017 after one of the partners died, which led to surrendering the old registration and obtaining fresh registration from the VAT Authorities. The case remitted back to the respondent to pass a speaking order - petition allowed by way of remand.

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• Income Tax

• 2022 (4) TMI 461
  Reopening of assessment u/s 147 - proof of suppression of facts - HELD THAT:- There has been suppression of facts by the petitioner inasmuch as it was not disclosed during the original assessment proceeding as well as in the replies to the notice under Section 142(1) and in the writ petition that Mr. Gaurav Dalmia was a common director in Banyan Real Estate Fund, Mauritius, Landmark Hitech Development Pvt. Ltd. and Landmark Realtech Pvt. Ltd. It is the case of the Revenue that the petitioner s company is owned and controlled by a US Company and consequently the sale of shares by the petitioner to Landmark Realtech Pvt. Ltd. is not entitled to the benefit of the Indo-Mauritius DTAA. This Court is of the view that the matter requires detailed examination. Let a counter affidavit be filed within four weeks. The respondents are permitted to take the plea of maintainability of the writ petition in its counter affidavit. Rejoinder affidavit, if any, be filed before the next date of hearing.

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• 2022 (4) TMI 460
  Reopening of assessment u/s 147 - mandation of final assessment order after the Jurisdictional Assessing Officer (JAO) disposed the objections - HELD THAT:- We have also considered the affidavit. For the sake of brevity we simply note that that we accept the explanation given and also accept the apology tendered by Mr. Shiv Kumar. Further explanation of Mr. Shiv Kumar who is present in court and on his behalf by Mr. Abhishek Anand who is also present in the court that Shivkumar s final role will be only to pass the final assessment order after the Jurisdictional Assessing Officer (JAO) disposed the objections and that final assessment order will be passed only after four weeks of the order on objections being passed, until then petitioner s case will be kept in abeyance is accepted as statement made to the court. In view of what is recorded above, Mr. Deshpande states that Interim Application may be disposed.Interim application accordingly disposed with no order as to costs. Time for the JAO to dispose petitioner s objections, if any, is extended by further period of four weeks from today. At the cost of repetition, it is directed that the JAO shall consider all submissions being made by petitioner and grant a personal hearing with atleast seven days advance notice.

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• 2022 (4) TMI 459
  Stay of demand when the appeal is pending consideration - petitioner is served with Ext.P10 notice demanding payment of amounts imposed under Ext.P1 order of assessment - due to the outbreak of Covid-19 pandemic and the financial difficulties, petitioner was called upon to submit its written submissions utilizing the e-proceedings facility on or before 18/9/2020 - petitioner pointed out that despite uploading the written submissions of the petitioner as directed by the respondents, no orders on the appeal have been issued for the last more than 18 months - HELD THAT:- Severe restrictions due to Covid-19 pandemic were introduced, including lockdown. Situation changed thereafter. This fact was noticed by the Income Tax Department itself, as seen from Ext.P6 notice, wherein they directed the petitioner to submit the written submissions electronically in the e-proceedings facility on or before 18/09/2020. Though there was few days delay, petitioner had uploaded the written submissions by 3/10/2020. In such an instance, Appellate Authority was bound to pass final orders in the appeal. However, it is submitted that till date, final order in the appeal has not been issued. Taking into consideration the aforesaid circumstances, I am of the view that, this is a fit case where the circumstances warrant a direction to dispose of the appeal itself in a time bound manner. As already more than 18 months have elapsed since the petitioner was directed by the respondents to upload the hearing note which it had in fact done, and even after that, the respondents failed issue the final order in the appeal, interests of justice demands that recovery proceedings ought not to be pursued in the meantime. The respondent or the Competent Appellate Authority must be directed to consider and dispose of the appeal in a time bound manner.

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• 2022 (4) TMI 458
  Revision u/s 263 - CIT disallowing the deduction u/s 80P - case of the assessee was selected for limited scrutiny under CASS for the reason to verify whether the cash deposit has been made from disclosed sources - HELD THAT:- We find merit in the arguments of the Ld. AR that where the case was selected for a limited scrutiny, the Instruction of the CBDT No. 20/2015, dated 29/12/2015 (supra) has been rightly following by the Ld. Assessing Officer by limiting the assessment proceedings to the limited issue as generated by the CASS. The Coordinate Bench of the Mumbai Tribunal in the case of M/s. Su-Raj Diamond Dealers Pvt Ltd vs. CIT [ 2019 (12) TMI 26 - ITAT MUMBAI ] has quashed the order passed U/s. 263 of the Act in the case of limited scrutiny assessment, holding that the Ld. Pr. CIT under the garb of section 263 of the Act, cannot exceed his jurisdiction. Admittedly, the case of the assessee was selected for limited scrutiny under CASS for the reason to verify whether the cash deposit has been made from disclosed sources. However, the Ld. Pr. CIT by exercising his jurisdiction u/s. 263 of the Act, directed the Ld. AO to make a fresh assessment on the issues which were not the subject matter of the limited scrutiny. Considering all since the issue raised by the assessee in the present case has already been decided in favour of the assessee by various Benches of the Tribunal as discussed above, we find merit in the arguments of the Ld. AR that the Ld. Pr. CIT has exceeded his jurisdiction U/s. 263 of the Act by directing the Ld. AO to make a fresh assessment on the issues which were not the subject matter of the assessment framed on the basis of the limited scrutiny. However, no contrary decision was brought to our notice by the Ld. DR. Hence, respectfully following the decisions of the Tribunal in the foregoing paragraphs, we allow the appeal of the assessee and set-aside the order of the Ld. Pr. CIT passed U/s. 263 - Appeal of assessee allowed.

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• 2022 (4) TMI 457
  Characterization of receipts - nature of receipts - compensation received as consideration for restrictive covenant to not to do business in the same line for a prescribed period - revenue receipts or capital receipts - HELD THAT:- The amount of compensation received by the assessee company from LIPL during the year under consideration i.e. A.Y.2010-11 [ 2018 (11) TMI 323 - ITAT RAIPUR] being in nature of a capital receipt was not exigible to tax. Accordingly, finding no infirmity in the order of the CIT(Appeals) we uphold the same. - Decided in favour of assessee.

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• 2022 (4) TMI 456
  Revision u/s 263 by CIT - reassessment order u/s. 147 - Bogus LTCG - Assessing Officer in the course of assessment proceedings had not verified the details of purchase and sale of shares, numbers of shares, copy of demat account which would have revealed the date on which shares were received by the assessee in his de-mat account, as well as not examined as to whether or not the assessee had regular dealings with the broker and the source of purchase of shares in question etc - HELD THAT:- Observing, that the reason to believe on the basis of which the case of the assessee was reopened was factually incorrect, the Assessing Officer, had therein vide his order passed under Sec. 147 r.w.s 143(3), dated 01.12.2018 accepted the returned income of the assessee as such. At this stage, we may herein observe, that though the reopening of the assesse s case on the basis of misconceived and fallacious reasons to believe would be fatal to the very existence of the order of reassessment that was passed by the AO under Sec. 143(3) r.w.s.147 of the Act, dated 01.12.2018, however, as the income of the assessee as was originally returned by him was accepted by the AO vide his reassessment order, therefore, most probably for the said reason the assessee had not challenged the validity of the same by carrying the matter any further in appeal. Be that as it may, as the reassessment order passed by the AO under Sec. 143(3) r.w.s 147 of the Act, dated 01.12.2018 is in itself based on invalid assumption of jurisdiction by the AO, therefore, the said material fact had rightly been pressed into service by the ld. AR for impressing upon us that a non-est assessment i.e, an assessment which has no sanctity of law could not have been revised by the Pr. CIT vide his order passed under Sec. 263. Now when the very foundation of the impugned revisional proceedings i.e, the reassessment order passed by the AO under Sec. 143(3) r.w.s.147 of the Act, dated 01.12.2018 is in itself based on an invalid assumption of jurisdiction by the AO and thus, not sustainable in the eyes of law, therefore, the Pr. CIT could not have assumed jurisdiction u/s 263 and validated the said reassessment order by restoring the same to the file of the AO with a direction to reassess the income of the assessee afresh, therefore, set-aside the order passed by the Pr. CIT passed u/s.263 - Appeal of assessee allowed.

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• 2022 (4) TMI 455
  Disallowance of expenditure on account of Final Settlement Expenses - AO ad hoc basis disallowed 20% of deduction of expense - Onus proving the allowability of its claim for deduction of the expenditure - HELD THAT:- We find no infirmity in the view taken by the lower authorities. In our considered view, as the assessee had failed to substantiate the nature of the aforesaid expenditure which was claimed by him as a deduction therefore, the lower authorities had in all fairness disallowed 20% of the said amount. We, thus, concur with the view taken by lower authorities as regards the aforesaid issue - Decided against assessee. Disallowing on an ad-hoc basis 20% of its claim for deduction of Telephone expenses and Car expenses - HELD THAT:- As the lower authorities have rightly observed that the personal element qua incurring of the aforesaid expenses could not be ruled out, therefore, a part of the same was liable to be disallowed on the said count. Considering the reasonableness of the disallowance i.e. 20% of the respective expenses, we find no reason to interfere with the view taken by the lower authorities. - Decided against assessee.

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• 2022 (4) TMI 454
  Addition towards interest from money lending business - AO adopted rate of interest at 24%, which the ld. CIT(A) brought down to 18% - HELD THAT:- Considering the fact that the assessee was engaged in the money lending activity, which is obviously with a purpose of earning interest income, a reasonable rate of interest has to be applied. Taking into account the peculiar facts of the case, we are satisfied that the ld. CIT(A) was more than reasonable in applying interest rate of 18%, as against the interest rate of FDRs prevailing at that time at 15%. We, therefore, approve the computation of interest. Though the AO made addition of interest income in respect of remaining FDRs worth Rs. 22.00 lakh also, but the ld. CIT(A) deleted the same and the Revenue is not in appeal. In that view of the matter, it becomes graphically clear that the amount of interest offered by the assessee as income at Rs. 1,17,414/- is only qua the FDRs, which is distinct from money lending activity separately carried out by the assessee. Since no interest income was suo motu offered by the assessee on the money lending activity, the amount as computed by the ld. CIT(A) on this score at Rs. 4,17,350/- is held to be correctly added. This issue is, therefore, determined against the assessee. Unexplained investment in residential house construction - applicability of State PWD rates as against CPWD rates applied by the DVO in computing the value of the property - HELD THAT:- In view of the fact that the value has to be determined on the basis of State PWD rates and the ld. AR contended that the DVO applied Central PWD rates, we set aside the impugned order and remit the matter to the file of the AO for examining the rates applied by the DVO in determining the value of the property. In case, he applied the CPWD rates in determining the value of the property, then such value should be re-worked out by applying the State PWD rates. Amount of interest income added by the AO for which the addition has been sustained by the ld. CIT(A) should be telescoped in the unexplained investment in construction of Bungalow - Once an addition is made towards earning undisclosed income, then no addition should be made towards undisclosed investment to that extent. We order to reduce the amount of addition towards unexplained investment in Bungalow by a sum of Rs. 4,17,350/-, being, interest income from the money lending activity which was not originally disclosed. This relief would be in addition to the effect of the conversion of valuation of the property from the CPWD rates, if applied by the DVO, to the State PWD rates. The impugned order is set aside and the matter is restored to the file of the AO for doing accordingly.

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• 2022 (4) TMI 453
  Revision u/s 263 by CIT - order passed by AO u/s.143(3) r.w.s. 153A - Whether no incriminating material in the case of the assessee was found during the course of search proceedings conducted u/s.132(1)? - disallowance of business loss - HELD THAT:- When no incriminating material in the case of the assessee for the year under consideration was found during the course of search proceedings conducted u/s. 132(1) thereupon, the Assessing Officer in respect of the unabated assessment of the assessee could have only re-computed its completed assessment and was divested of his jurisdiction of making any independent addition/disallowance. As the Assessing Officer in the backdrop of his limited scope of jurisdiction could not have drawn any adverse inferences as regards the claim of forex loss, and therein made any independent addition/disallowance in the hands of the assessee, therefore, the order passed by him u/s. 153A r.w.s. 143(3) of the Act, dated 29.12.2016 being in conformity with the view taken in case of CIT Vs. Gurinder Singh Bawa [ 2015 (10) TMI 1761 - BOMBAY HIGH COURT] and CIT Vs. Deepak kumar Agarwal [ 2017 (9) TMI 850 - BOMBAY HIGH COURT] could not be dubbed as erroneous, failing which the same could not have been revised by the Pr. CIT. The order passed by the Pr. CIT u/s.263 cannot be sustained. We, thus, restore the order passed by the Assessing Officer u/s. 153A r.w.s.143(3) of the Act - Decided in favour of assessee.

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• 2022 (4) TMI 452
  Exemption under section 11 - As per AO assesseee s activity of conducting circulation audit was clearly a business activity for which consideration in the form of membership subscription and one time entrance fees was received advertisers or advertising agencies that benefit from the circulation figure and this had no utility that benefit the general public as such - Violation of provision u/s 13 - AO also stated that assessee received a predetermined fees in accordance with the slabs depending upon the circulation figures for carrying out audit under the garb of annual membership subscription and this was nothing but the consideration received for carrying out the audit of the publishers - income of the assessee on account of members and entrance fees was exceeded Rs. 25,00,000/-, therefore, case of the assessee was not covered by the 2nd proviso to Sec.2(15) - assessee company was registered u/s 25 of the Company Act, 1956 without share capital and it was also registered as a charitable organization u/s 12 (a) HELD THAT:- The assessee company was established for the main object to secure accurate circulation figures and data relating to all periodicals and media that sell advertising space and in regard to such publication to obtain information as to area of distribution and fixed standard forms and methods for ascertaining the net sales figures and generally all information that will be of assistance to advertisers and estimating the value of any publication for advertising purposes and to record such information and circulate it to members of this association and generally to establish a bureau of information in regard to all publication and the circulation of them for the benefit of members of the this association. Identical issue on similar facts that the amended provision of Sec. 2(15) of the Act has not application in the case of the assessee had been adjudicated by the coordinate bench of the ITAT [ 2018 (8) TMI 1707 - ITAT MUMBAI] wherein held that the main object of the assessee is that the assessee has to secure accurate circulation figure and data relating to all periodicals and media that sell advertising space and in regard to such publication to obtain information as to area of distribution and fix standard forms and method of ascertaining the circulation figures. Bureau also records information and circulate it to the members which consist of publisher of newspaper/ magazines advertising and media agencies advertisers and Government publicity Department. It also distribute information relating to aforesaid matters to the Government and other association having objects and similar to those of this associations. The bureau certifies circulation figures of members publication based and on comprehensive audit by the auditor from a panel of approved auditors. This is one of the main activity of the assessee company. How the objects became commercial in nature is not understandable. The objects of the company are for the ultimate benefit of the public, but in what circumstances the objects of the assessee become commercial in nature, is not substantiated by the revenue in fact, even a single transaction of trade or commercial or business has not been referred to by the revenue. There was no change in the activity of the assessee since past years, and therefore, the amendment by insertion of the proviso u/s 2(15) of the Act would not make the activity of the assessee as trade, business and commerce in nature specifically in the circumstances when there is not a single instance of any business on record. The dominant purpose if any is charitable and incidental activities are not required to be treated as business in nature. Merely came into existence of provision of Section 2(25) of the Act nowhere makes the object of the Assessee commercial in nature. Instances of business and profession are also not on record. Taking into account all the facts and circumstances of the case, we are of the view that the CIT(A) has wrongly denied the claim of the assessee u/s 11 of the Act which is liable to be allowed in the interest of justice. - Appeal of assessee allowed. Invoking the provision of Sec. 13(1)(c) (ii) Sec. 13(2)(g) r.w.s 13(3)(CC) - Section 164(2) provide for forfeiting of exemption for breach of Sec. 13(1)(d), resulting in levy of maximum marginal rates of tax only to that part of the income which has forfeited exemption. From the plain reading of this proviso it is evident that where the whole or any part of the relevant income is not exempt u/s 11 or 12 because of the provisions of Sec. 13(1)(c) or 13 (1)(d) then tax shall be charged on the relevant income or part of the relevant income at the maximum marginal rate. However, in the case of the assessee the assessee by filing of evidences/detail regarding qualification of the Secretary General and his working experience and valuable contribution towards attaining the purpose and object of the trustee, the assessee has satisfactorily proved that salary paid to the Secretary General was not excessive or not in violation of the provisions of Sec. 13(3) of the Act. Therefore, we consider that denial of exemption to the assessee u/s 11 without disproving the contrary evidence furnished by the assessee is not justified. Accordingly, the appeal of the assessee is allowed. Validity of reopening of assessment u/s 147 - HELD THAT:- It is evident from the material placed in the record that reopening u/s 147 in the case of the assessee was based on the tangible material i.e order of CIT(Exemption) dated 19.03.2016 by which the registration granted was cancelled. During the course of appellate proceedings before us the assessee failed to prove contrary that there was no tangible material. Therefore, the judicial pronouncement cited by the assessee are distinguishable from the facts of the case of the assessee. Accordingly, this ground of appeal of the assessee is dismissed.

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• 2022 (4) TMI 451
  Addition u/s 68 - assessee was selected for scrutiny for abnormal increase in cash deposit during the demonetization period as compared to pre-demonetization period - Allegation of the A.O. that assessee has not submitted any documents/details to establish the source of cash deposits made in the bank account - HELD THAT:- when the nature and source of old currency notes is fully supported and substantiated, no addition under section 68 of the I.T. Act, 1961 can be made. In this view of the matter, NFAC was not justified in sustaining the addition made by the A.O. on account of cash deposit in the bank account - Appeal of assessee allowed.

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• 2022 (4) TMI 450
  LTCG computation - Reference made by the Assessing Officer to the DVO for valuation - directing the Assessing Officer to adopt the cost of acquisition of asset of the assessee as on 01.04.1981 as against on the basis of the DVO s report - HELD THAT:- As held by the Surat Bench of this Tribunal in the case of Shri Mahdevbhai Mohanbhai Naik [ 2018 (7) TMI 2029 - ITAT SURAT ] the amendment made in the provision of Section 55A by the Finance Act, 2012 with effect from 01.07.2012 is substantive in nature and the same, therefore, is applicable to AY 2013-14 and onwards. Since the year involved in the present case is AY 2012-13, we respectfully follow the said decision of the Co-ordinate Bench of this Tribunal and uphold the impugned order of the learned CIT(A) in treating the reference made by the Assessing Officer to the DVO under Section 55A of the Act as bad in law and directing the Assessing Officer to adopt the fair market value of the land sold by the assessee as on 01.04.1981 for the purpose of computing Long Term Capital Gain on the basis of valuation report of the Registered Valuer as the said report representing experts opinion on the technical issue of valuation was available on record. Ground Nos. 1 2 of the Revenue s appeal are accordingly dismissed. Deduction u/s 54B - As from the perusal of the agreement to sale, final sale/conveyance deed was to be executed within three months which was done on 13.06.2011 and the sale proceeds had also been received by the assessee substantially at the time of execution of agreement to sale which were duly invested by the assessee in the purchase of new agricultural lands. These findings of facts recorded by the learned CIT(A) in his impugned order clearly show that there was a transfer of original asset, i.e. old agricultural land, by the assessee on 11.04.2011 itself on execution of agreement to sale coupled with possession within the meaning of Section 2(47)(v) of the Income-tax Act, 1961 read with Section 53A of the Transfer of Property Act, 1882; and the assessee having purchased the new agricultural lands within the specified period after the date of the said transfer was entitled to claim deduction under Section 54B of the Act. At the time of hearing before us, learned DR has not been able to bring anything on record to rebut or controvert the finding of facts recorded by the learned CIT(A). We, therefore, find no justifiable reason to interfere with the impugned order of the learned CIT(A) giving relief to the assessee on this issue and upholding the same, we dismiss Ground No.3 of the Revenue s appeal.

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• 2022 (4) TMI 449
  Validity of Assessment u/s 153A - proof of incriminating materials found in the search - whether the addition could be framed u/s 153A of the Act in respect of a concluded proceeding without the existence of any incriminating materials found in the course of search? - HELD THAT:- We find that the provisions of section 132 of the Act relied upon by the revenue would be relevant only for the purpose of conducting the search action and initiating proceedings u/s 153A - Once the proceedings u/s 153A of the Act are initiated, which are special proceedings, the legislature in its wisdom bifurcates differential treatments for abated assessments and unabated assessments. In respect of abated assessments (i.e pending proceedings on the date of search) , fresh assessments are to be framed by the ld AO u/s 153A of the Act which would have a bearing on the determination of total income by considering all the aspects, wherein the existence of incriminating materials does not have any relevance - in respect of unabated assessments, the legislature had conferred powers on the ld AO to just follow the assessments already concluded unless there is an incriminating material found in the search to disturb the said concluded assessment. In our considered opinion, this would be the correct understanding of the provisions of section 153A of the Act , as otherwise, the necessity of bifurcation of abated and unabated assessments in section 153A of the Act would become redundant and would lose its relevance. We find that this issue had been the subject matter of adjudication in the case of CIT vs Continental Warehousing Corporation (Nhava Sheva) Ltd [ 2015 (5) TMI 656 - BOMBAY HIGH COURT] which had been decided in favour of the assessee and accordingly would bind this tribunal Thus we hold that the assessment framed u/s 143(1) of the Act for the Asst Year 2009-10 , which was unabated / concluded assessment, on the date of search, deserves to be undisturbed in the absence of any incriminating material found in the course of search and accordingly the disallowances / additions made thereon are hereby directed to be deleted. - Appeal of assessee allowed.

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• 2022 (4) TMI 448
  Exemption u/s 11 - As per AO assessee has been claiming exemption u/s.10(23C) in the earlier years and during the year under consideration the assessee had got registration u/s. 12A - CPC rejected the claim of the assessee u/s.10(23C) by holding that the assessee had not obtained necessary approval from the prescribed authority and the receipts of the assessee exceeded Rs. 1.00 crore. The application for rectification u/s.154 was also rejected - HELD THAT:- Nowhere in the appellate order the ld. CIT(A) disputed the fact that assessee was not registered u/s.12A of the Act. The registration certificate granted by the department on 2.9.2014 is on record. Further the uploading of Form-10B which is a audit report u/s.12A(b) of the Act, proves that the mistake committed by assessee in claiming exemption u/s.10(23C) is inadvertent mistake as by committing such a mistake the assessee is not going to gain anything. Fact of the matter is that assessee is registered u/s.12A of the Act and is eligible for exemption u/s.11 of the Act. Therefore for inadvertent mistake the assessee cannot be penalized. Since the assessee has been claiming exemption u/s.10(23C) in the earlier years therefore during the year under consideration there is high probability that assessee again claimed exemption u/s.10(23C) by overlooking the fact that it had already got registration u/s.12A of the Act which in any case was available with the assessee before the filing of return of income. The mistake has occurred as a human error and should have been judicially considered - we direct the Assessing Officer to allow the exemption to the assessee u/s.12A of the Act in accordance with law - Decided in favour of assessee.

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• 2022 (4) TMI 447
  Deduction under section 54F - Denial of deduction as income derived from sale of assessee s share of built-up area which the assessee was to receive under the JDA had to be regarded as income from business - whether the sale proceeds of the built-up area which the assessee was to receive from the Developer as his share of built-up area under the JDA is to be assessed as Capital Gain or Business Income? - HELD THAT:- When the owner sells his share of built-up area, the built-up area is acquired when the developer delivers possession of the built-up area to the owner but the undivided share of land is already owned by the owner. When an owner sells his share of property under a JDA he sells two components one is undivided share of land which he held for a longer period than the building and the building which he gets from the developer on completion of the building and the period of holding of the building is much shorter than the period of holding of the land. The concept of bifurcation of undivided share of land and built-up area is a well recognized concept. In practice, a building and the land appurtenant thereto held by an assessee, could be transferred together to a transferee through a single conveyance deed against a lumpsum monetary consideration. In such cases, the question on the method of computing the long term capital gains arises (i.e.) whether the long term capital gain/short term capital gain could be computed for land and building separately? This question assumes paramount importance since the period of holding will decide whether the capital gain is long term or shorter and the indexed cost of acquisition and improvement thereto in respect of these assets will vary depending upon the period of holding. In order to claim the capital gains separately for land and building, the assessee is required to give basic details like the original cost of acquisition of land and building, the year acquisition etc separately duly supported by necessary documentary evidences as they may be required at the time of scrutiny assessment. Based on the holding period of these assets, the capital gain is long term or short term and the indexed cost of acquisition could be computed. Likewise in order to claim the indexed cost of improvement necessary documents in support of the improvements done and the expenditure incurred thereon have to be also maintained by the assessee. How to appropriate the sale consideration for the transfer of land and building if a lump-sum monetary consideration is received by the transferor from the transferee when the transfer is effected through a single conveyance deed ? - In all the registered conveyance deeds, wherein transfer of land and building is involved, an Annexure is appended or there are documents wherein the market values are furnished for the land and the building separately for the purpose of stamp duty valuation. The market value of the immovable property transferred as indicated in the sale deed will be equivalent to the actual sale consideration received by the transferor from the transferee. If this value exceeds the value adopted or assessable by the Registration Authority for stamp duty purposes, the said sale consideration as appropriated to land and building as per Annexure or other documents attached with the registered sale deed could be adopted for the purpose of computing the capital gains. If the sale consideration is lesser than the value adopted or assessable by the Registration Authority for stamp duty purposes, then such value so adopted by the Registration Authority as appropriated between the land and building could be adopted as deemed sale consideration for the respective assets for the purpose of computing the capital gains. We are of the view that it would be just and appropriate to direct the AO to examine the issue afresh in the light of the directions as given above. The AO will afford opportunity of being heard to the assessee in the set aside proceedings. Appeal of the Revenue is accordingly treated as partly allowed for statistical purposes.

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• 2022 (4) TMI 446
  Exemption u/s 11 - voluntary donations received by the assessee have been claimed as exempt - HELD THAT:- We do not find any infirmity in the order of the ld. CIT(A) who has restored the matter to the AO directing that the AO will investigate the genuineness of the voluntary donations and will apply the provisions of section 12A(2) of the Act as per law. There is no infirmity in the order of the CIT(A) and the same is upheld. Appeal of the Revenue is hereby dismissed.

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• 2022 (4) TMI 445
  Correct head of income - gains from purchase and sale of shares - business income or short term capital gain - HELD THAT:- Frequency alone cannot show that the intention was to make any investment. Further, it has been held that the legislature has not made any distinction on the basis of frequency of transaction - it is also judicially settled that frequency alone cannot be taken as the basis to deny the claim by the assessee of short term capital gain. Various other facts need to be examined which mainly include the source of investment made in the equity shares. If a person takes loan, pays interest thereon and uses the borrowed funds for making investment in the equity shares on a regular basis then depending upon the facts and circumstances of the particular case it can be inferred that transactions carried out are in the nature of business. Thus in light of the ratio laid down in the case of Merlin Holding (P.) Ltd. [ 2015 (5) TMI 794 - CALCUTTA HIGH COURT] hold that the assessee deserves to succeed on the sole ground raised in the instant appeal firstly, because the investment made in the equity shares for purchase are not from borrowed funds and they are majorly from the assessee s own capital, secondly, that the assessee has taken the delivery of the shares and held them in her demat account and sold thereafter and thirdly, the assessee is consistently showing the income from long term capital gain and short term capital gain from sale of shares in the past and in subsequent years and not disputed by Revenue. We, therefore, set aside the finding of the ld. CIT(A) and hold that the gain should be taxed as a short term capital gain and not as a business income - Appeal of assessee allowed.

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• 2022 (4) TMI 444
  Reassessment u/s. 147 vide notice of u/s. 148 - Cash withdrawals from bank account wherein huge turnover deposited - HELD THAT:- Only information which was available to the AO was that there were turnover of more than Rs. 3 crores out of which there was withdrawal of cash was Rs. 94.97 lacs in the bank account of the assessee. Except the aforesaid information, there was no information available to the Assessing Officer that the income of the assessee in any manner has escaped assessment. Even the Assessing Officer did not correlate the aforesaid transaction in the bank account with the accounts of the assessee to form the belief regarding the escapement of income. Merely that there were huge turnover i.e. deposits and withdrawal in the bank account of the assessee without correlating the same with the accounts and with the nature of the business of the assessee, in our view, that was not enough to form a belief of escapement of income of the assessee for the assessment year under consideration. Even as pointed out by the ld. AR, the reopening was made at the last date of the 6th year from the end of the assessment year under consideration, which was the last day of limitation period for the Assessing Officer to reopen the assessment. As per the settled law, the Assessing Officer should have given opportunity to the assessee to contest the reopening and file objections against the reasons recorded. However, in this case, the reopening was done on the last date of limitation period, therefore, no opportunity to file objections has been granted to the assessee which violates the principles of natural justice. The another point noted by theCIT(A) in the impugned order is that even the Assessing Officer failed to make any addition in respect of aforesaid high turnover. CIT(A) has, therefore, relied upon the decision of CIT Vs. Jet Airways Limited[ 2010 (4) TMI 431 - HIGH COURT OF BOMBAY] wherein it has been held that if the Assessing Officer fails to make any addition on the basis of reasons recorded, the Assessing Officer gets no jurisdiction to add any other item of income - No infirmity in the order of the CIT(A) and the same is upheld. - Decided in favour of assessee.

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• 2022 (4) TMI 443
  Disallowance of commission paid to the HUF s - assessee had resorted to diverting commission payments to HUF entities as per the concerned Karta s reques - HELD THAT:- Neither anyone put in appearance on behalf of the assessee nor there is any document on the file to show that the aforesaid HUF entities have rendered any service to the assessee, justifying the payment of the aforesaid commission amount. We, therefore, do not find any infirmity in the order of the CIT(A) and the same is upheld. The appeal of the assessee is thereby dismissed.

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• 2022 (4) TMI 442
  Revision u/s 263 by CIT - Merging of CIT order - HELD THAT: A perusal of the aforesaid Clause- C of Explanation-1 to Section 263(1) of the Act would reveal that ld. Pr. CIT/CIT can invoke his jurisdiction u/s 263 of the Act in respect of the Assessment Order which had been the subject matter of any appeal relating to such matters as had not been considered and decided in such appeal. However, in this case, the matter in relation to which the ld. PCIT has invoked his jurisdiction, by way of issue of notice dated 02.05.2019 u/s 263 of the Act, has already been considered and decided in appeal by the ld. CIT(A) vide order dated 24.01.2019. In view of this, the impugned order passed by the ld. Pr. CIT is not sustainable as per law and the same is accordingly quashed.

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• 2022 (4) TMI 441
  Delayed payment of employee s contribution to PF/ESIC - HELD THAT:- This is not disallowable as the amendments to Section 36(1)(va) and Section 43B effected by Finance Act, 2021 were applicable prospectively in relation to Assessment Year 2021-22 and subsequent years. Therefore, the claim of deduction of contribution to Employee s State Insurance Scheme (ESI) and Provident Fund u/s. 36(1)(va) could not be denied to the assessee in Assessment Year 2018-19 in question on the basis of amendments made by Finance Act, 2021. For this proposition, we find support from the decision of the Co-ordinate Bench of Tribunal in the case of The Continental Restaurant and Caf Company vs. ITO [ 2021 (10) TMI 843 - ITAT BANGALORE] and Adyar Ananda Bhavan Sweets India P. Ltd. [ 2021 (12) TMI 558 - ITAT CHENNAI] Consequently, we see no error in the order of the CIT(A) and therefore decline to interfere. Appeal of the Revenue is dismissed.

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• 2022 (4) TMI 440
  Deduction of employees contribution towards PF ESI paid before the due date of filling of the return - Scope of amendment to section 36(1)(va) of the Act and section 43B - HELD THAT:- Recently in the case of Lumino Industries Ltd. [ 2021 (11) TMI 926 - ITAT KOLKATA] has held that the amendment brought in by the Finance Act 2021 w.e.f. 01.04.2021 inserting explanation to section 36(1)(va) of the Act and section 43B of the Act are prospective in nature and shall be inforce from assessment 2021-22 and onwards and therefore, for the period before such amendment, if assessee has deposited the contribution of PF and ESI for the year concerned before the due date of filing return of income u/s 139(1) of the Act, which in the instant case is well proved by the finding of Ld. CIT(A) itself, no disallowance could be made u/s 36(1)(va) of the Act. Thus, no interference is called for in the finding of Ld. CIT(A) deleting the said disallowance. Appeal of assessee allowed.

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• 2022 (4) TMI 439
  Addition u/s. 68 - bogus loan creditors as the identity and creditworthiness of the loan creditors and genuineness of the transactions could not be proved by the appellant - assessee was primarily engaged in the business of advancing and taking loans/advances - HELD THAT:- The assessee have not only filed a details relating to identity such as their PAN numbers, Income Tax Return and confirmation etc. but has also given party-wise details of the transactions. The lower authorities did not point out any defect or error in the details and evidences given by the assessee. AO has relied upon the investigation carried out by him/through his Inspectors, whereas, the contention of the ld. AR has been that the said investigation report/enquiry report of Inspector cannot be relied upon without confronting the same to the assessee and without giving an opportunity to the assessee to cross-examine the concerned officer and rebut the said enquiry report. The assessee has also given explanation regarding the source of cash credit stating that the cash deposits was made from available cash in hand. The assessee used to first withdraw cash from Bank and then the excess cash withdrawal was deposited in the Bank A/c of the assessee. Thus, the source of the cash deposits was out of the amount withdrawn from the Bank as and when needed and the excess cash withdrawal was re-deposited in the Bank A/c. Neither AO nor CIT(A) has given any findings relating to any defect or discrepancy in respect of the above explanation and evidences furnished by the assessee. The entire order is based on certain enquiries conducted by Investigation Wing. When in his opinion the said money did not belong to the assessee then addition cannot be made in the hands of the assessee as his unexplained income. In view of this, we do not find justification on the part of the lower authorities in making the additions and confirmation made by the AO. Disallowance of interest expenditure - contention of assessee has been that it is the case of the assessee that the assessee is engaged in the business of taking and giving loan on interest and earned interest income - HELD THAT:- AO has taken into consideration the interest income shown by the assessee, however, has failed to given credit/interest expenditure, which in our view is not justified. In view of this, the additions made by the Assessing Officer in respect of disallowance of interest expenditure is not sustainable in the eyes of law and the same is ordered to be deleted. Appeal of the assessee stands allowed.

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• 2022 (4) TMI 438
  Assessment of trust - donation in corpus fund and in non-corpus fund - addition had been made, observing that no reply had been hitherto received in response to letter issued, on the basis of random selection, in the cases of both, corpus as well as non-corpus donations - HELD THAT:- Firstly, the assessee cannot be faulted for non-receipt of replies to letters written by the Assessing Officer directly to the donors. Even the Show Cause Notice issued to the assessee, was issued on 6.12.18, whereas the assessment would have been gotten time-barred on 31.12.18. Assessment Order got passed on 27.12.18. It was, therefore, that at the remand stage that the details, i.e., complete ledger account of the donors in the corpus and other and non-corpus funds, the copies of Receipts and Confirmations from various donors along with their ID proof got to be filed by the assessee again before the AO and that too, on its own accord - Irrespective, the fact remains that all these details were thoroughly examined and verified by the AO, as required by the ld. CIT(A), and it was only on the basis of such verification that the Remand Report, accepting both the corpus as well as non-corpus donations, was furnished by the AO before the ld. CIT(A). No fault of the assessee that the confirmations could not be received by the AO in the original assessment proceedings. It was, rather, that even the time provided by the AO to the assessee for furnishing details was too short, though the assessee had maintained, again, undisputedly, all possible details of all its donors, both the corpus as well as non-corpus, and such details were duly furnished by the assessee, before the AO. The assessee, of its own, had furnished before the Assessing Officer in the assessment proceedings, all information regarding the donors and the donations. AO had not required the assessee to offer an explanation as to why the verification letters issued by the AO had not been confirmed by the donors. Not even a list of the persons to whom verification letters had been issued by the AO, had been given to the assessee. The addition, thus, stood made without confronting the assessee in this regard and thereby violating the basic principles of natural justice and basing the assessment order on the enquiry conducted at the back of the assessee. CIT(A) found, on the basis of the above facts and circumstances, beside the Remand Report of the Assessing Officer, that the assessee had maintained complete details of the donors, indicating their names and addresses and the amount received from each one of them. The Assessing Officer was observed to have conducted necessary verification. The Remand Report submitted by the Assessing Officer was seen to be without any adverse finding in view of the complete details provided and the verification made. Thus it cannot at all be said that the ld. CIT(A) deleted the addition merely on the basis of the affidavit submitted by the assessee. Accordingly, Ground No. 1 raised by the Department carries no merit.

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• 2022 (4) TMI 437
  Working of LTCG on sale of property - Claim of excess construction cost denied - HELD THAT:- we note that the assessee himself before the AO has agreed that he has claimed excessive construction cost by Rs. 2,50,000.00 only. - we do not find any reason to interfere in the finding of the AO. Thus, the ground of appeal of the assessee for claiming the deduction on account of the expenditure is dismissed. Deduction under the provisions of section 54 - Profit on sale of property used for residence - deduction was denied by the AO on the reasoning that the assessee was already in the possession of the residential house at the time of purchase of the new house - HELD THAT:- As we note the word used in section 54(1) of the Act reads as investment in a residential property which ought to be interpreted as property in which investment should be of residential in nature in nature. As the word a residential property should not understood in singular number or one residential property. In holding so, we find support and guidance from the judgment of Hon ble Karnatka High Court in case of CIT vs. D. Ananda Basappa [ 2008 (10) TMI 99 - KARNATAKA HIGH COURT] The assessee cannot be denied the benefit of the deduction provided under section 54 of the Act if he has a house at the time of transfer of the property and makes the investment in another residential property. Accordingly, the finding of the authorities below is devoid of any merit. Likewise, the amount of capital gain is less than the amount of the investment made by the assessee in another residential house. Therefore, we are of the view that the assessee is eligible for deduction under the provisions of section 54 of the Act. Accordingly, we set aside the finding of the learned CIT-A and direct the AO to allow the benefit of deduction for making the investment in another residential unit of Rs. 12,50,000.00 only. Accordingly, there cannot be any addition to the total income of the assessee on account of capital gain as discussed above. Hence, the ground of appeal of the assessee is allowed.

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• 2022 (4) TMI 414
  Reopening of assessment u/s 147 - denial of natural justice - Faceless Assessment Officer (FAO), goes ahead with wanting to conduct a parallel proceedings and passes three hundred plus pages of order on objections without granting a personal hearing but offering to grant a post facto personal hearing - HELD THAT:- Despite petitioner bringing to his notice that a personal hearing has been granted by respondent no.1 in Mumbai, the same FAO, who is respondent no.4 herein, continues to go ahead with the proceedings and has issued a letter even on 10th March 2022 as final show cause notice to petitioner. Respondent states that he does not know who the FAO is. The said FAO, whose details shall be disclosed to Mr. Suresh Kumar, shall file an affidavit explaining why he has gone ahead with the proceedings notwithstanding being aware of the order passed by this Court on 17th January 2022. The said FAO shall also file a personal affidavit showing cause as to why contempt proceedings should not be initiated against him and why substantial cost should not be imposed upon him for wasting this Court s precious judicial time due to his conduct/action in breach of orders of this Court. The FAO is given time upto and including 19th March 2022 to file this affidavit. We are making it clear that no further adjournment will be granted and we may even consider imposing substantial cost on the next date. In the meanwhile, respondents shall not take any steps in furtherance of the notices issued by respondent no.4 including the recent one dated 10th March 2022. Stand over to 22nd March 2022 on which date the said FAO shall remain present in Court failing which such order as required to ensure his presence will be passed including issuance of warrant of arrest against him.

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• 2022 (4) TMI 413
  National Faceless assessment - Order under Section 147 read with Section 144 - appealable order under Section 246A or not - HELD THAT:- Petitioner could not satisfy this Court when the query was made that is there any statutory bar under Section 246A in filing appeal against the impugned assessment order under Section 147 read with Section 144 of the Act. On the face of the grounds itself taken in the writ petition it appears to me that petitioner wants this Court to interfere with the impugned assessment order actually on merit by avoiding the remedy of statutory appeal available to him before the CIT appeal under the statute. Petitioner in support of his contention relies on a decision in the case of Gurgaon Realtech Ltd. Vs. National Faceless Assessment Centre Delhi [ 2021 (6) TMI 433 - DELHI HIGH COURT] . On the proposition that the impugned assessment order is without jurisdiction and on perusal of the aforesaid decision, we find that in the said case subject matter of challenge in the said writ petition was assessment order passed under Section 143(3) which Section 143(3A) and 143(3B) of the Act and not under Section 147 read with Section 144 of the Act. We am not inclined to entertain this writ petition on the ground of availability of alternative remedy by way of statutory appeal and for the reason that the remedy petitioner wants in this writ petition if granted would amount to interference with the impugned assessment order on merit for which this is not the appropriate forum and all the issues raised in the writ petition can be adjudicated by the appellate authority since there is no statutory bar in raising the grounds of challenge made out for interfering with the impugned assessment order in this writ petition.

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• Customs

• 2022 (4) TMI 436
  Validity of SCN - Jurisdiction - Proper Officer or not - power of Commissioner, CGST and Central Excise, Kanpur, the Respondent No.4 to adjudicate the SCN - challenge is based on the premise that the Respondent No.4 is neither a proper officer nor is competent to pass any order under the Customs Act, 1962 - It is claimed that the Respondent No.4 was merely assigned the jurisdiction by the order of the Board dated 20.11.2012 and cannot, therefore, be an officer appointed under Section 4(1) of the Customs Act, 1962 - HELD THAT:- A perusal of the notification dated 23.09.2011 issued by the Board would show that sub-Section (11) would operate notwithstanding anything contrary to the judgment, decree or order of any Court and all persons appointed as officers of the Customs under sub- Section (1) of Section 4 before the 6th Day of July, 2011 would be deemed to have always had the power of assessment under Section 17 and should be deemed and always should be considered as proper officers for the purpose of the said section. The question, however, as to whether by virtue of the notifications dated 07.07.1997, 07.03.2002 and 06.07.2011, the DRI would have the authority to act under Section 28 of the Customs Act and whether by virtue of the decision of the Hon ble Supreme Court in the case of COMMISSIONER OF CUSTOMS VERSUS SAYED ALI [ 2011 (2) TMI 5 - SUPREME COURT] this position would be altered. It is evident from the notification dated 07.07.1997 that all officers of the DRI are appointed as officers of the Customs under the notification dated 07.03.2002. The officers of the Directorate of Revenue Intelligence have been given jurisdiction over the whole of India. From the perusal of the notifications circulars and clarifications issued from time to time it is more than apparent that the Respondent No.2 had the jurisdiction to issue impugned show cause notice and the Respondent No.4 has the jurisdiction to adjudicate the same. The show cause notice under Section 28(1) could be issued by the Proper Officer . A Proper Officer is one, who is defined in Section 2(34) as the officer of Customs, either by the Board or by the Commissioner of Customs, who is assigned specific functions - the Respondent No.2 had the jurisdiction to issue impugned show cause notice. The petitioner is not entitled to any of the relief claimed in the writ petition. The writ petition is devoid of merit and is, accordingly, dismissed.

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• 2022 (4) TMI 435
  Seeking provisional release of goods - Revenue found it necessary to insist upon additional security deposit for recovery of differential duty on culmination of ongoing investigation along with estimated fine and penalty under section 111 and 112 of Customs Act, 1962 - HELD THAT:- The deposit of Rs. 97,00,000/-, in tranches between 31st May 2019 and 20th August 2019, as intimated to Deputy Commissioner of Customs, SIIB (Import), JNCH, Nhava Sheva by letter dated 14 th September 2019 is not controverted by Revenue. It is found from record of communication dated 13th September 2019 from the investigating agency to the assessing authority concerned which, in opining that finalisation of the bill of entry can be undertaken on the basis of the test report, is studiously silent about any investigation other than into the impugned consignment. At the same time, it is noted that, despite the seizure having been affected on 29th May 2019, no show cause notice has been issued though, as prescribed under section 110 of Customs Act, 1962, initial deadline of six months, that may be extended to one year for doing so, is attendant upon such deprivation of access to imported goods. It is seen that section 110A of Customs Act, 1962 provides for release to the owner on furnishing of bond in proper form and with such security as the adjudicating authority may require. The impugned goods continue to remain under seizure of customs authorities. Section 110 of Customs Act, 1962 mandates release of goods within six month from the date of seizure unless show-cause notice proposing confiscation has been issued or, on compliance with prescribed procedure, within further six months. The pendency of appeal against the terms of release does not alter the prescription therein. Furthermore, even after the order dated 23 rd October 2019 of the Tribunal, goods continued to be under seizure despite lapse of time even thereafter. The retention of goods, not validated by issue of notice, is not tenable in law and must, in accordance with the law, be released unconditionally to the appellant. In the wake of unwillingness to responsibly aver that investigations have been widened to cover earlier imports or of the lack of demonstrated evidence of such and, considering the absence of any such assigning after intimation from the appellant, the deposit of Rs. 97,00,000/- is attributable only to the seized goods. The interests of Revenue are, thus, not jeopardised by unconditional release - the order directing deposit of Rs.75,00,000/- is set aside as insofar as present appeal, arising from the order of provisional release, is concerned, the respondent is not on sound footing. Appeal disposed off.

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• Corporate Laws

• 2022 (4) TMI 434
  Seeking Winding up of Company - Oppression and Mismanagement - allegation is that majority shareholders have acted in a manner oppressive to the minority shareholders of the company - Section 272 of the Companies Act, 2013 - HELD THAT:- From a reading of the observations of the Independent Auditor in his report, it is seen that there is increase in liability but the assets are not increasing. Therefore, the operation of the company is becoming detrimental to the interest of its stakeholders. There is a likelihood of the happening of the event of insolvency. In the result, by exercising powers conferred on this Tribunal under Section 273 of the Companies Act, 2013 and other extant provisions of Companies Act, 2013, it is opined that it is a fit case for winding up of the company as the Auditors Report is very clear on that count. The Provisional Liquidator is permitted to initiate appropriate action in accordance with extant provisions of Companies Act, to take custody or control of all the properties, effects and actionable claims to which Company is or appears to be entitled to and take such steps and measures, as may be necessary, to protect and preserve the properties of the Respondent No. 1 Company and to avoid misuse of its property. List the petition for further orders when the final report received from the Provisional Liquidator - Registry is directed to send a copy of this order to the Petitioner and Respondents as also to the Provisional Liquidator immediately.

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• 2022 (4) TMI 412
  Eligibility of prospective Resolution Applicant - whether the final decision on the eligibility of the prospective Resolution Applicant U/s 29A lies with the RP or with the CoC? - HELD THAT:- In terms of the judgment of Hon ble Supreme Court in Arcelormittal India Private Limited v/s Satish Kumar Gupta [2018 (10) TMI 312 - SUPREME COURT], Section 29A has been noticed along with Sections 30 25(2)(i) of the Code, it has been stated therein that the RP is not required to take any decision but merely to ensure that the Resolution Plans submitted are complete in all respects before they are placed before the CoC who may or may not approve it. The fact that the RP is required to confirm that the Resolution Plan is not contrary to any of the provisions of law (that includes Section 29A of the Code) only means that a prima facie opinion is to be given to the CoC that a law has or has not been contravened. Section 30(2)(e) does not empower the RP to decide whether the Resolution Plan does or does not contravene the provisions of law. The RP is a facilitator and not a gatekeeper. In these circumstances, the ends of justice would be met if the RP is directed to place all Resolution Plans along with his opinion on the contravention or otherwise of the various provisions of law before the CoC which should take a considered view in the matter, if not already done. Application disposed off.

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• Insolvency & Bankruptcy

• 2022 (4) TMI 433
  Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational debt or not - grievance of the Appellant is that the Adjudicating Authority on misapplication of facts and law has held erroneously that part of the claim filed by the Appellant for outstanding payment due on raw material invoices is not an operational debt and that the remaining part of the claim for balance payment for equipment being an operational debt is subject to disputes - existence of debt and dispute or not - HELD THAT:- It seems that Respondent has made some part payments also to the Appellant against their commercial invoices. However, it is a grey area and there is a need to go into details of voracity of various submissions made by the Appellant and the Respondent. There is a need to find out voracity of various submissions and the business module; it does not seem to be straight jacket case that there is no payment due to the Appellant from the Respondent but at the same time it cannot confirmed that all sums as demanded by the Appellant is due and payable in law and on fact by the Respondent as there seems to be some back to back payment understanding between the parties as appears from the record. The justice demands to refer back the matter to the Adjudicating Authority for having a fresh look on various issues relating to the business module and the purchase order and invoices raised by the Appellant and the payment so far released and the balance due linking it to the back to back receipt from customer for the supply made by the Respondent which is a joint responsibility - the matter is remanded to the Adjudicating Authority for a fresh look and the Adjudicating Authority is requested to dispose of the matter expeditiously in accordance with law. Appeal allowed by way of remand.

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• 2022 (4) TMI 432
  Essential items during Moratorium period - Supply of water by KWIPL - water is required for enabling generation of electricity to be sold by KMPCL to generate revenue and make profits - essential goods and services or not - HELD THAT:- From the agreement it is clear that the KWIPL under took to supply water to KMPCL and the terms are governed in the Articles. Article 2 deal with Water Transportation and Article 5 deal with quantity of Water - the Water Transport Agreement (2014) was amended on 01.03.2015 (Amended Agreement) and as per the Amended Agreement the minimum and maximum quantity of Water to be transported was revised for the initial period of two years. Further, it is stated that the amendment agreement included a review process for considering prolonging of the amendments. The Amended Agreement was based upon certain developments taken place subsequent to 2014 Agreement and according to the parties the same have impacted the project s its functioning which required the said amendments. The parties to the 2014 Agreement are the same to the Amendment Agreement. The sequence of events that led to file the application before the Adjudicating Authority is that the letter addressed by the Respondent No. 1 dated 31.03.2017 supra to the Appellant after taking over as IRP and invoice dated 17.05.2021 for the month of April, 2021 and the Appellant replied to the said letter on 25.05.2021 and also various correspondences took place between the Appellant and the first Respondent. The first Respondent vide letter dated 31.05.2021 intimated the Appellant that the water supply from KWIPL shall stand suspended from 01.06.2021 due to non-payment of invoice dated 17.05.2021 and absence of an O M Contract. Reference to Section 62 of Indian Contract Act, 1872 - HELD THAT:- The requisites of a novation are a previous valid obligation, an agreement of all the parties to a new contract, the extinguishment of the old obligation, and the validity of the new one - It is not in dispute that the KMPCL is into CIRP vide order dated 03.10.2019 and the KWIPL is into CIRP, vide order dated 01.01.2021 and imposed moratorium in respect of both the Corporate Debtors. In respect of both KWIPL the first Respondent was appointed as RP vide order dated 08.04.2021. While so after taking over the affairs of the Corporate Debtor i.e. KWIPL the first Respondent vide letter dated 23.04.2021 addressed to the KMPCL requesting for payment of outstanding dues with reference to water transported to KMPCL and also made a note with regard to the water transport agreement and amended agreement. Applicability of Section 14(2A) of the I B Code, 2016 - HELD THAT:- The Law is very clear on the aspect and cannot be interpreted to suit either to the Appellants or the Respondents. However, we are unable to accept the contentions of the Learned Counsel for the Appellants that such supply meaning thereby the quantity mentioned in the amended agreement dated 01.03.2015. As per the definition of Black s Law Dictionary Sixth Addition, the word such defined as of that kind, having particular quality or character specified . Identical with, being the same as what has been mentioned . Be that as it may, this Tribunal cannot interpret such supply to actual supply in view of clear and unambiguous provision as enshrined in Section 14 (2A) of I B Code - Once the CoC has exercised its commercial wisdom it is neither open to the Appellant nor the Respondent no.1 to alter the terms contrary to such ratification under Section 28 (1) (f). In catena of decisions of the Hon ble Supreme Court held that the commercial wisdom of CoC cannot be interfered with. Admittedly the parties have entered into a WTA dated 14.03.2014 and Amendment Agreement dated 01.03.2015 whereby certain amendments made to Articles by incorporating Article 5.1 a and Article 5.2 a to the original Agreement. However, there is a dispute with regard to substitution to the original agreement by way of amendment agreement and the amendment agreement only subsists - this Tribunal is not expected to function as original and Appellate Jurisdiction to decide and adjudicate upon the disputes pertaining to the contractual obligations. This Tribunal comes to an irresistible and inescapable conclusion that the view taken by the Adjudicating Authority with regard to passing of the order is free from any legal and factual error and therefore, does not warrant any interference - This Tribunal comes to a resultant conclusion that the Appellants have not made out any case to be interfered with accordingly both the Appeals stand dismissed.

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• 2022 (4) TMI 431
  Seeking Liquidation of Corporate Debtor - Section 33(1)(a) of Insolvency Bankruptcy Code, 2016 - HELD THAT:- The primary object of IBC is resolution and liquidation is the last resort. At the same time keeping the timelines prescribed under the IBC is paramount, lest asset value gets deteriorated. Therefore, taking into consideration the provisions of law as well as the documents on record, this Adjudicating Authority is of the view that since the efforts to obtain resolution of the Corporate Debtor have failed, the only option left under the circumstances being early liquidation process, this petition is allowed, directing the liquidation of the Corporate Debtor. The Corporate Debtor, M/s. Sri Parameswara Poultry Farm Private Limited, is put under liquidation process in the manner laid down in Chapter-III of the Code with effect from the date of order - Application allowed.

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• 2022 (4) TMI 430
  Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - application is filed within the period of limitation or not - MoUs between the Financial Creditor and Corporate Debtor are executed under proper authorization or not? - HELD THAT:- The present Application which is filed after three years from the date of the MoU or from the date on which the six months falls, which is also beyond three years, is based on a cheque dated 19.11.2020 which is issued by the authorized signatories of LEPL Ventures Private Limited. The date of MoU being 23.06.2016, six months from then would be ending by 23.12.2016. If three years is construed from 23.12.2016, the three years period would be completed by 23.12.2019. Hence, clearly the limitation for filing a suit, based on the MoUs, stands expired by the date of this application. It would be beneficial to refer to the Judgment of the Supreme Court in B.K. EDUCATIONAL SERVICES PRIVATE LIMITED VERSUS PARAG GUPTA AND ASSOCIATES [ 2018 (10) TMI 777 - SUPREME COURT ], wherein it is held that the limitation act is applicable to applications filed under Section 7 and 9 of the IBC from the inception of the Code. Article 137 of the Limitation Act gets attracted. It was held that the right to sue therefore accrues when a default occurs and if the default has occurred over three years prior to the filing of the date of the application, the application would be barred under Article 137 of the Limitation Act, save and except in those cases wherein Section 5 of Limitation Act may be applied to condone the delay in filing such application. Subject to the finding on the contentions of the Counsel for the Financial Creditor, by virtue of the above judgment, this application stands to have been filed after three years, when reckoned from the dates mentioned in the MoUs, as observed in the above paragraphs. Coming to the Judgment of the GUJARAT HIGH COURT in Hindustan Apparel Industries [ 2000 (5) TMI 1095 - GUJARAT HIGH COURT ], the Patna High Court has already held that a post-dated cheque would amount to acknowledgement of liability irrespective of it being dishonoured subsequently - It is observed that when the drawer issues a cheque it is very much in his mind that it does show as part of his jural relationship with the person to whom he issues the cheque and there may be different state of his mind at the stage when the cheque is presented for payment. It was held that a cheque would prima facie amount to an admission of debt unless a contrary intention has been expressed by the person issuing the cheque. Such an admission of payment of debt is to be determined with reference to the point of time at which the purported admission was made i.e., when the cheque was issued - according to Section 18 the acknowledgement of liability should be made before the expiration of the prescribed period for a suit or application in respect of the debt. If the acknowledgement is beyond the said period it does not amount to acknowledgment in terms of Section 18 of the Limitation Act. There is no doubt that this Tribunal has jurisdiction to lift the corporate veil, to understand the genuineness of the transaction. But for the purpose of understanding the genuineness of the transaction, if evidence need to be taken, the Tribunal would not have jurisdiction. In this case, from the terms of the MoU itself, it can be concluded that there is no concluded contract between the parties and that the due date for the debt has not arrived and consequently no default has been committed. Hence viewed from the angle of limitation and the angle of debt becoming due and the angle of the commission of default, the Petition is liable to be dismissed. If the Financial Creditor is bent upon realizing the amounts he has to get the performance of the MoUs done by approaching the appropriate Forum, but not by way of an application under Section 7 of IBC, 2016.

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• 2022 (4) TMI 429
  Presentation of statement of accounts in relation to running of Corporate Debtor, CIRP costs, along with all material documents thereto before the COC and updating the status of the Corporate Debtor - seeking discussion on change of RP in the present matter and appoint another RP to run the corporate debtor as a going concern - Regulations 39B, 39C and 39D of IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. Whether the RP can be directed to convene a meeting of the Members of the COC, notwithstanding the order rejecting the resolution plan approved by the COC, which order is under appeal? - HELD THAT:- The CoC is entitled to call upon the Resolution Professional to convene the meeting of the members of the COC, in as much as the Resolution Professional is bound by the decisions of the COC and cannot act as per his whims and fancies or detrimental to the interest of the COC. That apart, the RP is also answerable to the COC for all his acts and actions under IBC, which he has so far performed and now supposedly performing by virtue of the interim order passed by the Hon ble NCLAT. There are also fault with the Resolution Professional for not convening the meeting of the members of the COC for over a year without any valid reason. If permission of this Adjudicating Authority for convening the meeting of the COC is the requirement, then nothing prevented the RP from seeking permission from this Adjudicating Authority. In fact, at no stage, the RP has informed the members of COC that unless the permission of the Tribunal is obtained, he will not be able to convene the meetings of the members of the COC - the said plea is nothing but an afterthought. In fact, when this Adjudicating Authority has not accorded approval to the Resolution Plan, it was the bounden duty of the RP to call for the meeting of the COC in order to discuss further course of action, which the RP has failed. The RP is hereby directed to forthwith convene a meeting of the Members of the COC - COC shall finalise its Agenda for the proposed meeting having regard to the fact of pendency of Appeal No. 325 of 2021, before the Hon ble NCLAT, Chennai. Application allowed in part.

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• 2022 (4) TMI 428
  Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - Service of demand notice - pecuniary jurisdiction of this Tribunal - HELD THAT:- The claim amount in this Application is below the limits of the pecuniary jurisdiction of this Tribunal and hence, the Application cannot be entertained. Demand notice under Section 8 of IBC - HELD THAT:- The Counsel for the Operational Creditor relies on the judgment of Supreme Court in Macquarie Bank Ltd. Vs. Shilpi Technologies Limited, [ 2017 (12) TMI 850 - SUPREME COURT ] wherein the Supreme Court held that a conjoint reading of Section 30 of Advocates Act and Section 8 and 9 of the Code together with the Adjudicating Authority Rules and Forms thereunder would yield the result that a notice sent on behalf of an Operational Creditor by a lawyer would be in order. It held that it has been held in Gariwala Case [ 1991 (9) TMI 349 - SUPREME COURT ] , the expression an Operational Creditor may on the occurrence of a default deliver a demand notice under Section 8 of the Code must be read as including an Operational Creditor s authorized agent and lawyer, as has been fleshed out in Form Nos. 3 and 5 appended to the Adjudicating Authority Rules. In this case the Power of Attorney was given to one Mr. A.M. Sridhar by the Operational Creditor to issue notice in Form No. 3. The Counsel for the Operational Creditor contends that the said Power of Attorney would also empower the Power of Attorney Agent to appoint any Advocate practicing to issue notice. However, irrespective of the said Power of Attorney, in view of the Judgment cited above the notice issued by the Advocate would be a valid notice. Whether any debt is due to the Operational Creditor from the Corporate Debtor and whether the Corporate Debtor has committed any default in respect of the said debt and whether CIRP can be initiated against the Corporate Debtor? - HELD THAT:- There is no dispute that the debt is due to the Operational Creditor by the Corporate Debtor. But, for the said debt and default committed by the Corporate Debtor the initiation of CIRP cannot be done due to the debt being less than the pecuniary Limits of jurisdiction of this Tribunal. It however can recover the same by moving the appropriate forums. Petition dismissed.

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• Service Tax

• 2022 (4) TMI 427
  Levy of Service Tax - Outdoor Catering Services - It therefore appeared to the Department that Service Tax was paid only on the service portion and not on the entire gross value received by them - period from October 2005 to December 2010 - benefit of N/N. 01/2006-S.T. dated 01.03.2006. For the period prior to 01.04.2007 - HELD THAT:- The sole agreement of the appellant with M/s. Manali Petro Chemicals has been relied by the Department to hold that the appellant has been undertaking the activity of serving food prior to April 2007. As there is a separate agreement entered by the company with another person viz. M/s. Shanmugasundaram for serving the food, on the probability of facts, the argument put forward by the appellant that the activity of serving food was done by another contractor, appears to be more tenable and acceptable - demand do not sustain. For the period after 01.04.2007 - HELD THAT:- Admittedly, the appellant has been filing returns and paying Service Tax after 2007. The appellant has entered into two separate contracts and has been discharging Service Tax on the income received under the agreement for rendering the services. They have been paying Sales Tax / VAT on the amounts received for the supply of food. The case of the Department is that the value of these two contracts has to be clubbed together and after giving the abatement of 50% in terms of Notification No. 01/2006-S.T. dated 01.03.2006 the appellant has to discharge its Service Tax liability. The levy of Service Tax under Outdoor Catering Services would be attracted only if the activity involved serving of food and not mere sale of food. In COMMR. OF SERVICE TAX, PUNE-I VERSUS BINDRAS HOSPITALITY SERVICE PVT. LTD. [ 2019 (3) TMI 1854 - CESTAT MUMBAI] it was held that sale of cooked food to the employees at the counters would not be taxable under Outdoor Catering Services. When the value of food items have already been subjected to Sales Tax / VAT, we do not think that it is correct to levy Service Tax on the said amount again. The Tribunal in the case of M/S. GOLDLINE HOSPITALITY SOLUTIONS (P) LTD. VERSUS THE COMMISSIONER OF G.S.T. CENTRAL EXCISE, CHENNAI SOUTH COMMISSIONERATE [ 2019 (1) TMI 1309 - CESTAT CHENNAI] had occasion to consider a similar issue. After taking note of various decisions on similar issues, the Tribunal held that when Sales Tax / VAT has been discharged on the value of food items, the demand of Service Tax cannot be raised again by clubbing such value along with the service charges. The demand cannot sustain - Appeal allowed - decided in favor of appellant.

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• 2022 (4) TMI 426
  Valuation - photography service - value of the goods such as photography paper and chemicals used for providing photography service is required to be included in the gross value for the purpose of charging service tax - applicability of exemption N/N. 12/2003-ST dt. 20/06/2003 in respect of goods such as photography paper and chemicals used for providing photography service - HELD THAT:- The very same issue in the appellant s own case only for the different period has been considered by this Tribunal in the case of SHILPA COLOR LAB VERSUS COMMISSIONER OF C. EX., CALICUT [ 2006 (10) TMI 35 - CESTAT,BANGALORE] wherein the appellant was also one of the parties, it was held that Service tax is only imposable in the amount charge for services not other than services. Identical issue has been considered in another judgment in the case of M/S. JAIN BROTHERS M/S. PUNJAB COLOUR LAB. VERSUS CCE, BHOPAL [ 2008 (11) TMI 58 - CESTAT, NEW DELHI] where it was held that the photography service is a work contract involving both the elements of sale and service and the sale portion activity cannot be subjected to tax. Thus, the issue is no longer res integra and has attained finality in favour of the appellant - appeal allowed - decided in favor of appellant.

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• 2022 (4) TMI 425
  Extended period of limitation - Classification of services - processing and printing photograph from the negative supplied by their client - Photography Services or otherwise? - HELD THAT:- The case can be decided on the ground of time bar itself without going into the merit of the case. In this regard, it is found that the demand was raised on the basis of the AG s audit on scrutiny of the appellant s records such as Profit and Loss Account and Balance Sheet, which revealed that they have received some income in respect of service in question. It is also found that the issue involved is interpretation of the definition of service viz., Photography Service . There are various judgments on this issue and the appellant s stand is also that their activity of processing and printing out of photographs from native supplied by their client is in the category of advertisement films, for this reason also, the issue involved is interpretation of law. The suppression of fact cannot be alleged against the appellant. In the present case, the demand pertains to the period 2002-03 and 2003-04 whereas the show-cause notice was issued on 17.7.2007 which is much after the normal period - the entire demand is time barred - appeal allowed - decided in favor of appellant.

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• Central Excise

• 2022 (4) TMI 424
  CENVAT Credit - Job-work - capital goods used for the purpose of carrying out intermediate production process on goods supplied by M/s.Tata Motors Limited and removed without payment of excise duty under the procedure prescribed under Notification No.214/86 dated 25/03/1986 - HELD THAT:- The issue is no longer res integra and has been decided by Hon ble Madras High Court in the case of THE COMMISSIONER OF CENTRAL EXCISE VERSUS M/S. KYUNGSHIN INDUSTRIAL MOTHERSON LTD. [ 2015 (11) TMI 899 - MADRAS HIGH COURT] where it was held that Tribunal was correct in holding that wiring harness was removed without payment of duty under job work procedure to the principal manufacturer and that semi-finished goods removed by the job worker from its unit to the principal, without payment of duty, would not come within the scope of expression exempted final product used in Rule 57-R (1) equivalent to Rule 6 (4) of the Cenvat Credit Rules, 2004. The Tribunal has rightly held that availment of Modvat Credit on capital goods to be job work is in order. Credit allowed - appeal allowed - decided in favor of appellant.

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• 2022 (4) TMI 423
  CENVAT Credit - common inputs and input services which have been used in the manufacture of dutiable and exempted goods - non-maintenance of separate records - requirement to pay 5%/10% as per Rule 6(3)(A) of Cenvat Credit Rules, 2004 - HELD THAT:- It is not in dispute that the appellant have admittedly reversed the proportionate credit. Therefore, reliance placed on Hon ble Supreme Court in the case of CHANDRAPUR MAGNET WIRES (P) LTD. VERSUS COLLECTOR OF C. EXCISE, NAGPUR [ 1995 (12) TMI 72 - SUPREME COURT] , reversal of Cenvat Credit shall amount to non-availment of Cenvat Credit, if this be so, then Rule 6 is not applicable. Alternatively, once, the appellant have reversed the Cenvat Credit proportionately, they have opted for the reversal of proportionate credit then the Revenue cannot insist for some other option which the appellant has not opted for - As regard, non-filing of the declaration, which is only the procedural requirement. Due to lapse of procedural requirement, substantial benefit of proportionate reversal of Cenvat credit cannot be objected to. From the details asked for in the declaration, it is found that the same is otherwise available with the department, therefore, even if the details were not declared in the prescribed form but the details are otherwise required to be declared in the form are otherwise available with the department, therefore, mere non filing of declaration cannot be the reason that the appellant s option for the proportionate reversal is not available. No further payment can be demanded from the appellant - Appeal allowed - decided in favor of appellant.

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• 2022 (4) TMI 422
  CENVAT Credit - Input Services - services of electricity expenses in connection with their head office is admissible to the factory or otherwise? - service in connection with overall business activity of the manufacturing unit or not - HELD THAT:- The appellant factory is the sole factory for which the head office is located outside the factory. The head office is involved in the activity related to the factory s manufacturing and sale of the goods. The Head office is not operating for any other activity other than the activity relating to the factory operations, therefore, merely because the head office is located outside the factory, it cannot be said that the service received and used in head office does not relate to the manufacturing activity. Had this same office is maintained in the factory premises, there would not have any objection by the Revenue. The location of the head office is immaterial so long it is used only for the operation of the factory s activities, therefore, any service received in head office is in relation to the manufacturing activity of the appellant. This specific issue has been considered by this Tribunal in various judgements - reliance can be placed in the case of M/S. HID INDIA PVT. LTD. VERSUS COMMISSIONER OF SERVICE TAX BANGALORE [ 2016 (11) TMI 99 - CESTAT BANGALORE] , where on similar issue, credit was allowed. Thus, even though the input service was received by the head office but since it is in connection with overall business activity of the manufacturing unit, the credit is admissible - appeal allowed - decided in favor of appellant.

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• 2022 (4) TMI 421
  CENVAT Credit - input services - garden maintenance service for the garden being maintained within the factory premises - credit denied on gardening service per se but on the ground that the appellant have not established that the garden is maintained for the purpose of Pollution Control - HELD THAT:- It is evident from the consent order of the Pollution Control Committee for renewing the pollution control license that the appellant is required to green up the surrounding of the factory inside and outside. For this reason only the appellant are maintaining the garden, therefore, the entire basis of the department to deny the cenvat credit does not stand. In various judgements this Tribunal has considered the admissibility of the CENVAT Credit in respect of garden service. The appellants is entitled for the cenvat credit in respect of maintenance of gardening service - Appeal allowed - decided in favor of appellant.

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• CST, VAT & Sales Tax

• 2022 (4) TMI 415
  Initiation of recovery proceedings even before the period for preferring the appeal expired - Freezing of Bank Accounts of petitioner - HELD THAT:- It is essential in the interest of justice that proceedings for recovery be initiated only after expiry of the period for filing the appeal. Since the petitioner was served with the order of the first appellate authority only on 22.02.2022, as contended by the learned counsel for the petitioner, the period for filing the appeal will expire only on 21.04.2022. Initiating recovery proceedings even before the expiry of the said period will make the appeal practically redundant. Thus, it is ideal that the recovery proceedings are not proceeded with till 21.04.2022 so as to enable the petitioner to move the appellate authority. Accordingly, the prohibitory order issued by the first respondent, in respect of the petitioner as communicated by the 3rd respondent to the petitioner by letter dated 17.03.2022 shall be kept in abeyance for a period till 21.04.2022. Petition disposed off.

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• Indian Laws

• 2022 (4) TMI 470
  Dishonor of Cheque - insufficient funds - legally enforceable debt or not - proceedings were initiated on 12th day from the service of notice - HELD THAT:- This Court is of the considered opinion that the period of fifteen days as prescribed under Section 138(c) of Act of 1881 is a window available to the drawer of Negotiable Instrument to enable him to satisfy the legally enforceable debt and to avoid criminal proceedings - The Legislature was conscious when 15 days time was given as mandatory period under Section 138(c) to ensure that the drawer gets a fair deal in the shape of opportunity to satisfy the legally enforceable debt in case he desires to. It is noted that normally in criminal law notice is not mandatory but in the Negotiable Instruments Act a special provision has been made with mandatory impact so that the drawer can avoid criminal proceedings against him by making payment of the legally enforceable debt. The Negotiable Instruments Act is akin to civil law in many aspects but criminal culpability has been carved out only to ensure proper credence to the instrument. In the present case, the fact admitted are that the notice was served on 10.02.2010 and the proceedings were launched on 22.02.2010, which is 12th day of sending notice, instead of after completion of 15 days that would have happened on 25.02.2010 and, thus, the opportunity envisaged by the Legislature for the drawer on the completion of 15 days was cut short paving way for derailment of the 138 proceedings - the impugned order has taken note of the fact that the proceedings were initiated on 12th day i.e. 22.02.2010 from the service of notice and before the expiry of the mandatory period as provided under section 138(c) and, thus, has rightly held that no cause of action accrued to appellant while dismissing the proceedings. Appeal dismissed.

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• 2022 (4) TMI 468
  Seeking grant of anticipatory bail - criminal conspiracy - issuing forged certificates regarding the existence of unit and its operational status on the basis of which the supplies of coal were made to the alleged companies - HELD THAT:- As per the judgment of the Supreme Court in the case of BHADRESH BIPINBHAI SHETH VERSUS STATE OF GUJARAT ANOTHER [ 2016 (2) TMI 416 - SUPREME COURT] it has held that the nature and gravity of the accusation and the exact role of the accused must be properly comprehended, the previous criminal antecedents of the applicant whether he has previously undergone imprisonment on conviction, the possibility of applicant to flee and where the accusation has been made only with the object of injuring or humiliating the applicant by arresting him, are the circumstances that are to be taken into account as per Section 438 Cr.P.C. In the present case, this Court is of the view that since the charge-sheet was filed on 31.05.2012 and the applicant has not misused the liberty granted to him vide various orders, he is entitled to be enlarged on anticipatory bail. The anticipatory bail application of the applicant is allowed, subject to conditions imposed.

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• 2022 (4) TMI 420
  Dishonor of Cheque - insufficiency of funds - matter is already settled between parties - acquittal of accused - compounding of offences - Section 147 of NI Act - HELD THAT:- The admitted position is that the matter stands settled and the settlement agreement between the parties dated 27.09.2019 is already on record. This Court in VATSA ELECTRONICS VERSUS PALA RAM ANR. [ 2022 (4) TMI 353 - PUNJAB AND HARYANA HIGH COURT] has also held that once a settlement is being effected, then in terms of Section 147 of the Negotiable Instruments Act and Section 320 Cr.P.C., the accused ought to be acquitted as the offence stands compounded. The parties have voluntarily settled the disputes between themselves, it is a fit case for allowing them to compound the offence - Petition allowed.

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• 2022 (4) TMI 419
  Criminal leave to appeal - Dishonor of Cheque - acquittal of the accused - conviction of respondent for the offences as charged by allowing the complaint of the complainant - HELD THAT:- This Court observes that in the present case, as is reflected from the impugned order dated 13.03.2019, the accused-respondent had issued a cheque, bearing cheque no. 179300, in favour of the complainant-appellant, which was dishonored and returned with the remark Account Closed . And that, the notice was sent to the accused-respondent by the complainant-appellant, which he refused to accept. Thereafter, the complainant-appellant filed a complaint on the 13th day i.e. 25.04.2012, after serving the notice from the date of refusal of acceptance of said notice, by the accused-respondent, which was presented prematurely instead of after the completion of prescribed statutory period of 15 days, which would be after 27.04.2012. This Court, therefore, finds that the complainant-appellant registered the complaint before the statutory period of 15 days, as prescribed under Section 138 (c) of the Act of 1881. The present criminal leave to appeal is dismissed.

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• 2022 (4) TMI 418
  Dishonor of Cheque - application of presumption, when execution of the so called pro-note is not admitted - defendant has the right to ask the Court to consider the non existence of the consideration so probable that a prudent man ought, under the facts and circumstances of the case, to act upon the supposition that consideration did not exist, or not - suit is barred by limitation or not, if no dates specified/pleaded for borrowing money in a money suit - suggestion put to a witness during cross-examination amount to an admission of the execution of the pronote, or not - shifting of burden of proof upon the appellant - application of statutory presumption under Section 118[2] of the Negotiable Instruments Act when execution is denied - burden of proving the passing of consideration is upon whom in a money suit or not - HELD THAT:- The shifting the burden of proof depends upon the facts and circumstances of each case. In a case of pronote, there is an initial burden on the plaintiff which shifts on the defendant when the defendant admits execution of pronote. In the instant case, the defendant did not admit the execution of pronote. However, based on evidence, the Courts below have held that the execution of pronote is proved. As per the pronote, the amount was borrowed on the date of pronote. However, the pleading of the plaintiff is specific that the consideration for the pronote was the money borrowed by the defendant on various occasions. Therefore, the case of the plaintiff is that the suit pronote is supported by consideration. Merely because the plaintiff advanced loan to the defendant on various dates and the defendant executed the pronote subsequently in recognition of his liability, it cannot be said that the pronote is not supported by consideration. There is no difficulty in accepting the legal position that a statutory presumption is always rebuttable - However, in the present case, the plaintiff has taken meticulous efforts to prove the transaction. This Court justifies the findings of the Courts below that the pronote executed by the defendant is supported by consideration. In the instant case, no motive was specifically pleaded by the appellant against the plaintiff/respondent for filing the suit on the basis of pronote. In a suit based on pronote, the question regarding consideration cannot be decided merely on the basis of pleadings of parties. After considering the entire evidence on record, the Courts below have come to the conclusion that the suit pronote is supported by consideration. From the facts narrated, this Court is unable to agree with the appellant that the respondent/plaintiff has withheld any evidence to give room for drawing any adverse inference - this Court comes to the definite conclusion that the suit pronote was executed by the appellant/defendant in favour of the respondent/plaintiff and it was supported by consideration. In view of the concurrent findings of facts, this Court is unable to find a valid reason to interfere with the judgments and decrees of the Courts below. This Court is also unable to find substance in any of the substantial questions of law framed by the appellant, in view of the nature of the findings of the Courts below and the scope of Section 100 of CPC - the Second Appeal is liable to be dismissed for want of merits.

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