TMI Tax Updates - e-Newsletter
May 31, 2017

Case Laws in this Newsletter:

Income Tax Customs Service Tax Central Excise CST, VAT & Sales Tax Indian Laws

TMI SMS

• SSI exemption upto 10 lakhs - N/no 6/2005-ST - only the net value received, after the abatement under N/N. 1/2006-ST is to be considered

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• Exemption u/s 11 - violating conditions u/s 13 - foreign travel expenditure on the wife of Managing / Executive Director not allowed

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• Freight paid to non-resident shipping companies, taxable u/s 172 - recovery of the tax & its deduction at source (TDS) u/s 195 not justified

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Articles

1. GST: THE GAME CHANGER FOR E-COMMERCE SECTOR

   By: CANeha Somani

2. Transitional provisions-Credit of tax paid in relation to unsold stock [Section 140(3)] - Actual Credit as well as Notional Credit - Part-II

   By: CASanjay Kumawat

3. Time of Supply - GST

   By: CAJUGAL DOSHI

News

1. States may gain ₹ 350-450 billion in revenue post GST: Standard Chartered

2. Government Approves Four (4) Proposals of Foreign Direct Investment (FDI)

3. Customer Service in Banks: Time to Raise the Bar! (Shri S. S. Mundra, Deputy Governor – May 30, 2017 – at the Annual Conference of Principal Code Compliance Officers organized by the Banking Codes and Standards Board of India in Mumbai)

4. RBI Reference Rate for US $

Notifications

VAT - Delhi

1. F. No./Zone-5/W-61/MISC./2017-18/79-82 - dated 26-5-2017 - DVAT

Notified for general information Declaration Forms “C”, “E-I” and “F” are declared to be obsolete and invalid for all purposes

Circulars / Instructions / Orders

VAT - Delhi

1. 7/2017-18 - dated 26-5-2017

Grant of Registration under DVAT & CST

Companies Law

2. 06/2017 - dated 29-5-2017

Clarification regarding due date of transfer of shares to IEPF Authority

Highlights / Catch Notes

Income Tax

• Assessee's Declaration in Search Reveals Bogus Purchases; Income Includes Opening Balances, No Further Additions Needed.

  Case-Laws - AT : Addition made on the basis of declaration of the assessee during search action - bogus purchases - The said letter clearly indicates that the additional income declared includes opening balances - no additions - AT
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• Loans as Share Application Money Can Be Taxed as Deemed Dividend u/s 2(22)(e), Taxable to Shareholders.

  Case-Laws - AT : Deemed dividend u/s 2(22)(e) - load & advanced to the shareholders in the guise of share application money to the another concern / company - the dividend income is taxable in the hands of shareholders and not in the hands of the concern. - AT
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• Exemption Claim Denied u/s 11 Due to Section 13 Violations on Foreign Travel Expenses for Directors' Spouses.

  Case-Laws - AT : Claim of exemption u/s 11 - violating conditions u/s 13 - foreign travel expenditure which has been incurred on the wife of Managing Director and Executive Director is not to be allowed as deduction. - AT
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• Assessee admits to undisclosed income via inflated expenses; escapes penalty under Income Tax Act Section 271AAA.

  Case-Laws - AT : Penalty U/s 271AAA - In the statement recorded U/s 132(4) of the Act when the assessee categorically stated that he has derived undisclosed income by way of inflating expenses recorded in the books of account - no penalty - AT
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• Section 24 of Income Tax Act: Deductions for Let-Out Property Limited to Specified Allowances Only.

  Case-Laws - AT : Income from a let out house property determination - The list of allowance of section 24 is exhaustive. In other words, no deduction can be claimed in respect of expenses on insurance, ground rent, land revenue, repairs, collection charges, electricity, water supply, salary of liftman etc. - AT
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• Assessee-Company Must Justify Royalty Adjustments Under Transfer Pricing Agreement; Clubbing Transactions Without Justification is Prohibited.

  Case-Laws - AT : TPA - ALP adjustment in respect of royalty payment made - In the absence of justification, clubbing other transactions is not possible. The onus always lies on the assessee-company to establish the justification for clubbing and aggregation of the transaction of payment of royalty with other transactions.- AT
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• CIT's Revision of AO's Order Deemed Time-Barred u/s 263 of Income Tax Act.

  Case-Laws - AT : Revision u/s 263 - period of limitation - In the garb of revising the order of AO dated 14.03.2013 passed u/s 254 r.w.s.143(3) of the Act, the CT was virtually seeking to revise the order dated 31.12.2008 passed by the AO u/s 144 of the Act which is the original assessment order - The order has been passed by CIT on 25.03.2015 which is clearly barred by time - AT
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• No Penalty for Corrected Tax Claim u/s 153A; Section 271(1)(c) Penalty Not Applicable.

  Case-Laws - AT : Penalty u/s. 271(1)(c) - assessment u/s 153A - the incorrect claim did not get noticed either by the assessee or by the AO and its correction at the time of filing of return u/s 153A would not lead to imposition of penalty u/s 271(1)(c)- AT
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• Section 195 TDS Not Applicable for Freight Payments to Non-Resident Shipping Companies Due to Section 172 Override.

  Case-Laws - AT : TDS u/s 195 - disallowance u/s 40(a)(i) - overriding effect of section 172 - freight paid to non-resident shipping companies - there is no warrant in applying the provisions in chapter XVII for collection and recovery of the tax and its deduction at source vide section 195 - AT
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• Income Tax Act Section 292C: Rebuttable presumption not enough as denial of ownership leads to no tax additions.

  Case-Laws - AT : The presumption u/s 292C of the Act is rebuttable presumption and does not lead to a conclusive evidence. The assessee from the very beginning denied that the documents belonged to him and the AO made no effort to find out the real truth - No additions - AT
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• Stay Extension Granted: Assessee Must Not Transfer or Dispose of Fixed Assets as Part of Undertaking Requirement.

  Case-Laws - AT : Extension of stay for the recovery of demand granted subject to the condition that the assessee shall give undertaking to the effect that assessee shall not transfer, dispose off, alienate or create any kind of third party interest in the fixed and immovable assets of the assessee-company - AT
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Customs

• Demurrage Charges Post-Import at Indian Ports Excluded from Customs Valuation for Transaction Value Purposes.

  Case-Laws - AT : Valuation - Import of crude oil - the demurrage charges are admittedly incurred after the goods reached the Indian port and therefore it is a post-importation event. Such charges therefore cannot form part of the transaction value. - AT
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• LCD Panels Re-Exported in Original Form Exempt from Rule 8 Conditions for Concessional Duty Imports.

  Case-Laws - AT : Violation of conditions for goods imported at concessional rate of duty for manufacture - import of LCD Panel - if the goods on importation are re-exported as such then they should be treated as if they were never imported. In that event, Rule 8 of the said Rules will not be applicable - AT
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Service Tax

• Rule 6(3) of CENVAT Credit Rules: Flexibility in Compliance for Taxable and Exempted Services without Separate Books.

  Case-Laws - AT : CENVAT credit - Rule 6(3) of the CCR, 2004 - non-maintenance of separate books of accounts - there is no reason to insist at the respondent should necessarily follow the first option of paying 6% of the value of exempted service - AT
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• Court Rules No Service Tax on Unreceived Rent Recorded in Books; Demand for Tax Set Aside.

  Case-Laws - AT : Service tax on the amount of rent receivable shown in the books of account - No service tax is payable on the rent receivable, but admittedly not received by the appellant. - demand set aside. - AT
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• SSI Exemption: Calculate Net Value of Taxable Services with Abatement for Services Up to 10 Lakhs.

  Case-Laws - AT : SSI exemption - determination of value of taxable services upto 10 lakhs - for calculating that for the purpose of determining the aggregate value for exemption under N/N. 6/2005-ST, only the net value received i.e. after the abatement under N/N. 1/2006-ST is to be considered. - AT
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• Service Tax Demand on JNNURM Construction Set Aside Due to Non-Compliance with Section 65(105)(zzzh) Unit Requirement.

  Case-Laws - AT : Liability of service tax - construction activities mainly non commercial structures under JNNURM - none of the constructed blocks have got 12 or more units, attracting levy of service tax under Section 65(105) (zzzh) - demand set aside - AT
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Central Excise

• Debit Notes with Rule 4A(1) Details Qualify as Invoices for CENVAT Credit Under Service Tax Rules 1994.

  Case-Laws - AT : CENVAT credit - duty paying invoices - debit notes - any document which contains the details prescribed u/r 4A(1) of the STR, 1994, the same can be considered as the invoice or challan and will be a proper document for availing the CENVAT Credit - AT
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• Excise Duty Exemption for Oxygen, Nitrogen, and Argon Released into Atmosphere Explained in Detail.

  Case-Laws - AT : Levy of duty - manufacture of various gases such as Oxygen, Nitrogen, Argon etc. - gases which were vented out in the atmosphere are exempted from excise duty - duty not leviable - AT
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• CENVAT Credit Allowed for Respondent on Input Service Scope; Credits Claimed for Tax Paid on Business Services.

  Case-Laws - AT : CENVAT credit - scope of input service - the services on which credit of tax paid was taken had been rendered to the respondent. It would also be natural for any assessee to take the credit of any tax that has already been paid in connection with their business activities - credit allowed - AT
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• Rule 7 of Central Excise Valuation Rules, 2000 not applicable for goods sold at factory gate and via consignment agent.

  Case-Laws - AT : Valuation - Applicability of Rule 7 of Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 - The goods manufactured were both sold at the factory gate and were also transferred to consignment agent - provisions of Rule 7, were not applicable in the present case - AT
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• Brass Tubes Removal Under CENVAT Credit Rules: Not 'Waste and Scrap,' Rule 3 (5A) Inapplicable Decision Confirmed.

  Case-Laws - AT : CENVAT credit - Rule 3 (5A) of the CCR, 2004 - removal of Brass Tubes - removal as such or as waste? - the appellant have removed used Brass Tubes as ‘Brass Tubes’ and not as ‘waste and scrap’ - the provisions of Rule 3 (5A) of the CCR, 2004, are not attracted - AT
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• Dealers Sharing Ad Costs in Related Party Transactions Not an Extraneous Consideration for Central Excise Value.

  Case-Laws - AT : Valuation - includibility - related party transaction - whether the allegation of dealers sharing portion of the advertisement expenses, will constitute a extraneous consideration, in addition to the price charged and hence, whether such consideration will require to be included in the assessable value? - Held No - AT
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• CENVAT Credit Allowed for Plant Setup and Operational Phase After Renovation and Modernization Period.

  Case-Laws - AT : CENVAT credit - credit availed during setting up of the plant - It is obvious that when the project work of renovation and modernization of the plant is undertaken, it takes some time and after gestation period, the plant comes into operation and whatever goods manufactured out of that plant is cleared on payment of duty - credit allowed - AT
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• Appellant's Website Price Omission Leads to Extended Limitation Period Demand Confirmed by Investigation.

  Case-Laws - AT : Valuation - sale through depot - appellant has failed to mention the fact that they were adopting the price listed in their website and the fact came to the notice only when the Departmental officers visited the factory and carried out investigations - demand invoking the extended period of limitation confirmed - AT
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• Voluntary Duty Payment Before Show Cause Notice Nullifies SCN Issuance and Penalty.

  Case-Laws - AT : Imposition of penalty - when an assessee on his own ascertainment pays the amount of duty and interest thereon before issue of SCN, then SCN demanding the said amount cannot be served on the assessee - no penalty - AT
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Case Laws:

• Income Tax

• 2017 (5) TMI 1407
  Expenditure on issue of debentures - Allowable revenue expenditure - Held that:- Rajasthan High Court in the case of CIT v. Secure Meters Ltd. [2008 (11) TMI 66 - HIGH COURT RAJASTHAN ] fairly concluded that debenture when issued is a loan, and, therefore, whether it is convertible or non-convertible, does not militate against the nature of the debenture, being loan, and therefore the expenditure incurred would be admissible as revenue expenditure. Issue is squarely covered in favour of the assessee. Disallowance of sponsorship charges - Held that:- As find that the claim of assessee was denied for want of evidence of the expenditure incurred on account of sponsorship. During the course of hearing, no evidence is filed before the Tribunal, therefore find no infirmity in the order of CIT(Appeals). Accordingly, the order of CIT(Appeals) is confirmed in this regard. - Decided against assessee.

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• 2017 (5) TMI 1406
  Reopening of assessment - pendency of the block assessment proceedings - Held that:- The Court is satisfied that reopening of the assessment for AYs 1994-95 to 1996-97 by the impugned notices dated 31st May 2001 under Section 148 of the Act during the pendency of the block assessment proceeding was impermissible in law. Having initiated the proceeding under Section 158BC for the block assessment, there was no justification to issue the aforementioned notice under Section 147 of the Act as that would undoubtedly result in parallel proceedings. They are based on the same materials which form subject matter of the block assessment. The impugned notices dated 31st May 2001 are hereby quashed. As clarified that the Court has not expressed any view on any aspect of the block assessment proceeding or the materials gathered for that purpose and which form the subject matter of the proceedings before the ITSC. By virtue of all the applications filed by the Petitioners having been allowed to be proceeded with by the order 3rd August 2016 of the ITSC, it will be open to the ITSC to examine these aspects in the proceedings pending before it. However, it is also clarified that neither ITSC nor any of the parties to the pending proceedings refer to any part of the notices under Section 147 of the Act or the reasons for such reopening as such notices have been quashed by the present judgment of this Court.

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• 2017 (5) TMI 1405
  Addition made on account of sale of rice out of books - investment in stock out of undisclosed sources - Addition towards investment in stock of wheat purchased out of books - ITAT deleted the addition - Held that:- On perusal of the impugned judgment and order of the Tribunal reveals that the assessee has maintained the books of accounts in accordance with the prescribed standard as per Section 145 of 'the Act'. The account books have not been rejected by the assessing officer. In view of the above, the Tribunal formed an opinion where once the account books are expected to be maintained in the prescribed accounting standard, the assessing officer could not have made any additions towards the sale of rice treating it to be outside the books of accounts or towards investing in stock of rice and wheat outside the books of accounts. The controversy as raised above in this appeal stands duly covered by the Tribunal and it cannot be said that any investment was done beyond the books of accounts. - Decided in favour of assessee.

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• 2017 (5) TMI 1404
  Deduction u/s 80IB in respect of excise duty rebate/refund - Held that:- Since the issue had been decided on the basis of concession given in Liberty India’s case (2006 (9) TMI 487 - PUNJAB & HARYANA HIGH COUR ) it was argued that in various decisions the relief under Section 80IB of the Act could not be declined on Excise Duty refund and thus, the matter requires to be re-adjudicated. It was prayed by learned counsel for the appellant which could not be effectively controverted by the learned counsel for the respondent-revenue that in such circumstances, the matter be remanded to the Assessing Officer who shall examine the factual matrix and keeping in view the legal position in this aspect decide afresh in accordance with law. As a result of the above, it is held that the matter with regard to relief under Section 80IB of the Act requires to be re-adjudicated. Consequently, the matter is remanded to the Assessing Officer to decide it afresh, after hearing the parties by passing a speaking order in accordance with law. As a result, the appeal stands disposed of accordingly.

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• 2017 (5) TMI 1403
  Condonation of delay - Held that:- None of reasons can justify the extraordinary delay of 910 days in re-filing the appeal. After the appeal was initially filed on 20th August, 2014, the Department actually forgot about it entirely. It is not possible to accept that no one in the Department followed up on the filing of appeals and allowed a period of over two-and-a-half years to elapse before the appeal could be re-filed. The Department has a cell in the High Court which is under the supervision of a Deputy CIT. He ought to be keeping track of the filing of appeals and should be able to know if any appeal entrusted to the panel counsel for filing has not been listed even once before the Court for a long time. The Court is not convinced by the reasons given for the delay of 910 days in re-filing the appeal. The application for condonation of delay is dismissed.

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• 2017 (5) TMI 1402
  Validity of special audit - whether special audit has been directed only to secure more time to pass an order of assessment is concerned? - Held that:- There is nothing in the Act which prohibits the Assessing Officer from ordering/directing the special audit after a particular date before the last date of framing an assessment. An Assessing Officer can direct a special audit as and when he does come to the conclusion that the accounts of the assessee are required to be specially audited for any one of the reasons set out in section 142(2A) of the Act. Thus, this grievance is not sustainable. Not directing the special audit of the accounts of the petitioner's wife and family members - Held that:- It is an irrelevant consideration while considering the necessity of special audit in the case of the petitioner. The exercise of jurisdiction under section 142(2A) of the Act by the Assessing Officer has to be examined merely on the basis of the material available before him in respect of the assessee concerned while exercising jurisdiction to direct special audit. Nothing has been shown to us that on the basis of the material available before the Assessing Officer, the direction for special audit is perverse. Thus, this grievance is also not justified. Assessing Officer did not examine the books of account before ordering/directing the special audit - Held that:- We find that the show-cause notice as well as the impugned direction proceed on the basis that on verification of the books of account and vouchers that the issue of special audit arose. Thus, this grievance of non-examination of the books of account is without any substance. Moreover after the amendment to section 142(2A) of the Act with effect from 2013, a special audit is not restricted only to complexity of the accounts. The special audit can now be directed not only if the accounts are complicated but also if there is doubt to the correctness of the account or multiplicity of transactions or volume of transaction or specialised nature of the accounts. Other grievance that the notice did not indicate the reasons which led him to a prima facie view directing a special audit stands belied by the fact that the show-cause notice dated July 25, 2016, issued to the petitioner, in fact, indicated the basis for directing special audit on the basis of the volume of the total trades executed by the petitioner, multiplicity of transactions in the accounts, including the nature and complexity of the accounts and doubts about the correctness of the accounts. Therefore, this grievance is also without substance. The terms of reference indicates that the special auditor has also been asked to prepare accounts and therefore bad in law, is unjustified. Section 142(2A) of the Act empowers the Assessing Officer while directing a special audit to furnish audit report in the prescribed form and can also seek such other particulars from the special auditor which he may require to complete the assessment. The terms of reference indicate that the examination which had to be done by the special audit was to examine the accounts keeping in view the supporting evidence. Thus, this grievance is also without any substance. The argument that, entire direction for special audit is without jurisdiction as the Assessing Officer has no jurisdiction to assess the petitioner under section 153A of the Act in respect of three of the assessment years concerned as the assessment for those years had been completed under section 143(3) of the Act. At this stage, this submission on the part of the petitioner is premature. Presently, we are only concerned with the jurisdiction of the Assessing Officer to direct a special audit. The necessary conditions to be satisfied before the special audit is directed are listed/set out in section 142(2A) of the Act and these are satisfied. Thus the direction for special audit. The issue of framing/passing an assessment order would arise only after the special audit is completed. Thus there is no merit in this submission to challenge the direction of special audit by the impugned order. We find that the impugned order dated March 10, 2016 directing a special audit is not without jurisdiction. The procedural safeguards of notice, approval of the Chief Commissioner and hearing have undisputedly been complied with. Besides, the satisfaction recorded by the Assessing Officer before directing a special audit is his opinion on the basis of the facts before him and such opinion is not shown to be perverse.

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• 2017 (5) TMI 1401
  Penalty u/s 271(1)(c) - defective notice as it does not clearly strike out the charge of penalty - Held that:- We find that the notice issued u/s 274 of the Act by the AO for levying of the penalty is defective in so far it does not spell out the specific charge for penalty. The specific charge for the penalty whether it is levied for the concealment or furnishing of inaccurate particulars of income must emanate from the penalty notice. In the absence of specific charge in the notice, the several courts have decided the issue in favour of assessee . See Manjunatha Cotton & Ginning Factory [2013 (7) TMI 620 - KARNATAKA HIGH COURT] - Decided in favour of assessee. Penalty u/s 271(1)(c) - inaccurate particulars of income on account of low GP ratio declared by the assessee which was subsequently reduced by the ld. CIT(A). - A.Y.06-07. - Held that:- The assessee had furnished complete particulars before the authorities below. However, the addition in the hands of the assessee was made by estimating the GP profit on the turnover. In such circumstances, where no concrete evidence was found against the assessee and the addition being based on estimation, there is no merit in the levy of penalty u/s 271(1)(c) of the Act. Accordingly, we direct the Assessing Officer to delete the penalty levied for concealment u/s 271(1)(c) of the Act.- Decided in favour of assessee.

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• 2017 (5) TMI 1400
  Disallowance of deduction claimed u/s 80-IA - whether the compensation received by the assessee is business income and therefore eligible for the deduction under section 80IA ? - Held that:- It is undisputed fact that the compensation was received by the assessee from SEL as the machines failed to generate the guaranteed electricity units. It is also admitted fact that the assessee is into the business of wind power generation business. Thus it can be inferred that the impugned compensation has direct nexus with the business operations of the assessee and accordingly eligible for deduction under section 80IA of the Act. We also find that in the identical facts & circumstances the Hon’ble ITAT decided the issue in favor of assessee by allowing the compensation on account of power generation loss is entitled for deduction u/s. 80-IA of the Act in the case of Lahoti Overseas Ltd. Vs Dy. Commissioner of Income Tax [2016 (4) TMI 591 - ITAT MUMBAI] DR before us has alleged that the impugned compensation is in the nature of incentive which in our considered view is not true. It is because of the fact that it was given due to non-generation of units as guaranteed by the SEL. Thus by no stretch of imagination the compensation can be equated with the incentive. Thus we deleted the addition - Decided in favour of assessee.

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• 2017 (5) TMI 1399
  Addition on account of Interest earned from Non-members of the Society U/s 80P(2)(a)(i) - Held that:- We find that the assessee is a cooperative society registered under cooperative societies Act which claimed deduction under section 80P on an income by way of interest earned from its members on the loan advanced to them. The AO denied the deduction under section 80P(2)(a)(i) of the Act claimed by the assessee on the ground that the assessee is engaged in banking activities. But the CIT(A) re-examined the claim of the assessee and was of the view that the assessee’s income earned in the course of providing credit facilities to its members is eligible for deduction under section 80P(2)(a)(i) of the Act. During the course of hearing, the learned DR could not specifically point out any specific defect in the order of the CIT(A). See Tumkur Merchants Souharda Credit Cooperative Ltd., vs ITO, [2015 (2) TMI 995 - KARNATAKA HIGH COURT]- Decided against revenue

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• 2017 (5) TMI 1398
  Income from business of Real Estate - Held that:- From a careful perusal of the sale agreement, MoU and the letter of developer dated 18.02.2015, it appears that assessee has received certain amount over and above the amount payable under the agreement for sale at the time of execution of the sale deed in favour of prospective buyers. But the quantification of the amount is not done by the AO nor any formula was worked out. In the light of these facts, it is of the view that this issue requires readjudication by the AO in the light of the letter of the developer, agreement for sale and MoU. If need be, the AO may summon the developer and examine him in the presence of assessee. If the assessee has received amount over and above the sale consideration, the same should be assessed as income of the assessee. Accordingly, this issue is restored to the file of Assessing Officer for readjudication afresh in the terms indicated above. Appeals of the assessee stand allowed for statistical purposes.

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• 2017 (5) TMI 1368
  Addition made on the basis of declaration of the assessee during search action - bogus purchases - Held that:- The assessee has filed copy of ledger extracts of Shree Sai Industries and Soham Metal Pvt. Ltd. for the financial year 2004-05 indicating purchases made during the financial year starting from 01-04-2004 to 31-03-2005. The Department has not raised any doubt over the ledger extracts furnished by the assessee. The letter dated 28-03-2012 along with Annexure-I was filed by the assessee shortly after search. The said letter clearly indicates that the additional income declared includes opening balances for Financial Year 2004-05. We do not find any infirmity in the findings of Commissioner of Income Tax (Appeals) in deleting the addition. - Decided against revenue

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• 2017 (5) TMI 1367
  Addition on account of transfer pricing adjustment AMP expenses - AR contended that the TPO for the A.Y. 2012-13 in assesse’s own case has not made any transfer pricing adjustment on account of AMP expenses but has factored in the AMP intensity adjustment in the profit margin of the comparables and made transfer pricing addition on account of the international transaction of `Import of finished goods’ - Held that:- We are not convinced with the proposition put forth on behalf of the assessee because the entire proceedings before the TPO/DRP/AO have proceeded on the basis of a separate international transaction of AMP and its independent benchmarking. There is not even a whisper in the orders about carrying out AMP intensity adjustment instead of treating AMP as an international transaction. If the contention of the ld. AR is accepted, it will change the entire complexion of the case and would amount to travelling beyond the impugned order. As the TPO has considered AMP as a separate international transaction and determined its ALP; and further that the tribunal in assessee’s own case for the immediately preceding A.Y. 2009-10 has dealt with the determination of the AMP as a separate international transaction, we cannot now concur with the request of the assessee in allowing the setting up of an altogether different case. This contention, ergo, fails. To sum up, since the facts and circumstances of the instant appeals are mutatis mutandis similar to the immediately preceding year, respectfully following the precedent, we set aside the impugned order and send the matter back to the A.O./TPO for deciding this issue afresh in light of the foregoing discussion and the directions given by the Tribunal in its order for the immediately preceding year in the second round. Needless to say, the assessee will be allowed a reasonable opportunity of hearing in the resulting fresh proceedings. Transfer pricing adjustment AMP expenses - Assessment Year 2012-13 - Held that:- Respectfully following the decision taken for the A.Y. 2009-10, we hold that, firstly, the RPM should be applied as the most appropriate method for determining the ALP of the international transaction of purchase of material from the AE, but, by carrying out the AMP intensity adjustment in the profit rate of comparables. If, however, it turns out that such an adjustment cannot be done due to one reason or the other, then the RPM should be discarded and another suitable method be adopted, which encompasses the effect of AMP intensity adjustment. Our view is fortified by the judgment in the case of Sony Ericsson (2015 (3) TMI 580 - DELHI HIGH COURT), in which it has been held in para 165 that : `Comparable analysis of the tested party and the comparable would include reference to AMP expenses. In case of a mismatch, adjustment could be made when the result would be reliable and accurate. Otherwise, RP Method should not be adopted’. We, therefore, set aside the impugned order and remit the matter to the file of Assessing Officer/TPO for re-determining the ALP of the international transaction of ‘Import of finished goods’ in the manner delineated above. The assessee should be given an adequate opportunity of hearing in such fresh proceedings.

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• 2017 (5) TMI 1366
  TPA - selection of comparable - Held that:- The assessee is engaged in rendering IT enabled support services to Credit Pointe US. Thus the assessee is a captive service provider. Companies functionally dissimilar with that of assessee need to be deselected from final list of comparable. Allowability of claim of deduction u/s. 10B - Held that:- A perusal of the definition shows that 100% export oriented undertaking has to be approved by Board appointed by the Central Government in exercise of the powers conferred by section 14 of the Industries Development Regulation Act, 1941. Admittedly, the assessee has not been approved by the Board as specified under the provisions of section 10B of the Act. The language of the section is unambiguous and hence requires no further interpretation. Therefore, the assessee is not eligible for claiming deduction u/s. 10B of the Act. Alternate prayer that if the assessee cannot be granted benefit of deduction u/s. 10B the same may be granted under the provisions of section 10A - Held that:- The Co-ordinate Bench of the Tribunal in the case of Clarion Technologies Pvt. Ltd. Vs. Dy. Commissioner of Income Tax (2014 (11) TMI 141 - ITAT PUNE ) has held that where the assessee is not eligible to claim deduction u/s. 10B for want of approval from the competent authority, as specified under the said section and if the assessee is eligible to claim deduction u/s. 10A subject to fulfillment of all mandatory conditions as set out in the section, the alternate claim of assessee can be considered. We deem it appropriate to remit this issue back to the file of Assessing Officer to consider assessee’s claim of deduction u/s. 10A of the Act. The Assessing Officer shall verify assessee’s eligibility for claiming deduction u/s. 10A. While considering assessee’s alternate claim u/s. 10A, the Assessing Officer shall afford due opportunity of hearing to the assessee, in accordance with law.

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• 2017 (5) TMI 1365
  Deemed dividend u/s 2(22)(e) - loan & advanced to the shareholders in the guise of share application money to the another concern / company - taxability in the hands of shareholders - Held that:- The intention of the legislature is clarified in circular issued by the CBDT as at the time of amendment of clause (e) of sub section (22) of sec. 2 is further fortified by the fact that for deduction of tax at source. Sec. 194 provide that such deduction of tax has to be made in the case of the payments of the nature mentioned in clauses (a), (b), (c), (d) and (e) of sub section (22) of Section 2 only in a case where such payments were made to a shareholder. Section 199 also indicates that adjustment of TDS would be provided in the assessment of shareholder only. The very fact that the provision for deduction of tax at source and adjustment of tax is only in respect of the payments to the' shareholder would clearly indicate that even after the amendment, the effect of clause (e) of sub section (22) of Sec. 2 would apply only when the payment is made to shareholder. Wherever, the tax is to be deducted at source from a dividend or deemed dividend and the consequential effect of giving effect to such deduction of tax at source, etc., reference was made only to the payments to the shareholder. This would indicate clearly that clause (e) would apply only in case of payments to the shareholder and not to others. In view of the foregoing discussion and following the special bench decision of Mumbai Tribunal in the case of ACIT Vs. Bhaumic Colour Pvt. Ltd. [2008 (11) TMI 273 - ITAT BOMBAY-E] as well as the decision of the Hon’ble Delhi High court in the case of CIT Vs. Ankitech P. Ltd.[2011 (5) TMI 325 - DELHI HIGH COURT ], we hold that the dividend income is taxable in the hands of shareholders and not in the hands of the concern. Accordingly, we dismiss the assessee’s ground on this issue. Once we find that the loan or advance is not taxable in the hands of such concern and should be taxed in the hands of shareholder and that is a correct legal position according to us, such a circular would be of no use. Further, Circulars are not binding on the courts. Accordingly, we dismiss this ground of assessee. Unable accept the contention of the AR that the deemed dividend should be assessed in the hands of the assessee proportionately to the extent of assessee’s shareholding in the recipient company. Therefore, we dismiss the ground raised by the assessee on this issue. - Decided against assessee.

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• 2017 (5) TMI 1364
  Claim of exemption u/s 11 - violating conditions u/s 13 - foreign travel expenses of spouse of the employee - Held that:- Admittedly, has no business connection with the assessee, except the relation with the Managing Director of the trust. Admittedly, the said foreign travel expenditure which has been incurred on the wife of Managing Director is not to be allowed as deduction. Expenditure incurred on foreign travel of Managing Director and other employees - Held that:- First expenditure for Robocon event, the Executive Director had visited along with other heads of departments and professors and students to attend an exhibition of Robotics. The said being in the line of business carried on by the assessee, the same is to be allowed as deduction in the hands of assessee i.e. the expenditure incurred on persons other than trustees or their relatives. In respect of expenditure incurred on the Executive Director of assessee trust, the same is hit by the provisions of section 13(1)(c) of the Act and accordingly, the same is not to be allowed as deduction as the expenditure is incurred on related party as mentioned in section 13(3) of the Act. We have already held that the foreign travel expenses of wife of Executive Director are also to be disallowed. Similarly, expenditure incurred for Mrs. Vidya Joshi wife of Shri Prakash Joshi who was the head of Department being not for the purpose of business is also disallowed. Travelling expenses to Paris for attending UNESCO conference - Held that:- Where the invitation was from the Government to attend the conference of UNESCO, then the expenditure as is eligible to him merits to be allowed in the hands of assessee i.e. to the extent of 1,63,370/-. Further, the expenditure incurred on Mrs. Suchitra Nagare who is the employee as well as the Executive Director Incharge of Medical College also, merits to be allowed. The balance expenditure is to be disallowed in the hands of assessee being in violation of provisions of section 13(1)(c) r.w.s. 13(3) of the Act. Accordingly, we hold so. The Assessing Officer is directed to verify the claim of assessee in this regard and allow the same accordingly. Accordingly, the ground of appeal raised by the assessee in respect of foreign travel expenses is partly allowed. Expenditure on account of World Peace Centre - Held that:- The said expenditure has been held to be allowable by the Tribunal in assessment year 2003-04 on the ground that the objects of World Peace Centre were educational in nature and it was also held that mere non-intimating the change in trust deed would not result any disallowance of expenses incurred on the objects of the trust. It was also held by the Tribunal that the expenditure incurred abroad for WPC could not be held as not for the objects of the trust and that exemption under section 11 of the Act could not be denied. Following the same parity of reasoning, we hold that the expenditure incurred on World Peace Centre is deductible expenses Corpus donation - Held that:- The assessee has no letters of donors against its claim of donations being corpus donations to the extent of 18,62,575/-. We hold that the said receipts are to be added in the hands of assessee. However, the assessee is not entitled to claim deduction under section 11 of the Act in respect of such donations. Hence, the ground of appeal decided against the assessee. Disallowance of provision made for gratuity under section 40A(7) (b) - Held that:- Tribunal in assessment year 2003-04 has held that while computing the income under section 11 of the Act, various disallowances or additions under sections 43B, 40A(7) and 40A(3) of the Act could not be made under section 28 to 43 of the Act. Thus following the same parity of reasoning, we allow this claim of assessee.

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• 2017 (5) TMI 1363
  Penalty U/s 271AAA - assessee has not clarified and not substantiated the manner in which the assessee derived undisclosed income - Held that:- . In the statement recorded U/s 132(4) of the Act when the assessee categorically stated that he has derived undisclosed income by way of inflating expenses recorded in the books of account. In view of this, the ld. CIT(A) was not justified in holding that the assessee has not clarified and not substantiated the manner in which the assessee derived undisclosed income. The assessee has categorically stated in answer to questions No. 5 to 7 in the statement recorded U/s 132(5) of the Act - Decided in favour of assessee.

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• 2017 (5) TMI 1362
  Revision u/s 263 - disallowance of commission and addition on account of unexplained cash credit namely receipt of share capital - period of limitation - Held that:- The scope of proceedings before the AO pursuant to the order of Tribunal dated 10.01.2012 is very limited namely considering the two additions one on account of disallowance of commission and the second one relating to receipt of share capital u/s 68 of the Act. In the impugned order, the CIT has sought to direct the AO to make enquiries in regard to disallowance of freight loading and unloading charges and clearing and forwarding charges. These items of expenditure was never the subject matter of disallowance in the original order of assessment and was therefore not the subject matter of the dispute before the Tribunal as well as in the proceedings before the AO pursuant to the order dated 10.01.2012. In the garb of revising the order of AO dated 14.03.2013 passed u/s 254 r.w.s.143(3) of the Act, the CT was virtually seeking to revise the order dated 31.12.2008 passed by the AO u/s 144 of the Act which is the original assessment order. The period of limitation for an action u/s 263 of the Act in so far as order dated 31.12.2008 would end on 31.03.2011. The impugned order has been passed by CIT on 25.03.2015 which is clearly barred by time in so far the issue sought to be revised in the impugned order is concerned. - Decided in favour of assessee.

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• 2017 (5) TMI 1361
  Penalty u/s.271(1)(c) - income from future and option transaction - Held that:- The assessee in its original return filed under section 139(1) had set off the said income against the loss incurred. However, while filing return under section 153A, the same was withdrawn in view of the realisation that the same was not permissible as per law. The explanation given by the appellant for disclosing reduced income in the return filed under section 139(1) is factually correct and the said reduced income is not attributable to any income regarding which particulars had not been correctly filed. The erroneous claim made earlier has been withdrawn on realising the mistake at the time of filing the return in response to notice under section 153A. The amount involved is 1,21,539. The said wrong claim could have been discovered by the assessee or could have been noticed by the AO in time after filing the return under section 139(1). However, the said incorrect claim did not get noticed either by the assessee or by the AO and its correction at the time of filing of return under section 153A would not lead to imposition of penalty under section 271(1)(c). - Decided against revenue Penalty u/s.271(1)(c) - undisclosed foreign income - Held that:- The return revised by the appellant is within the limit stipulated as per section 139(5) and therefore gets substituted by the return filed under section 139(1). Since there is no difference between the income returned in a return filed under section 139 and the assessed income, there is no cause for imposition of penalty under section 271(1)(c). The same is therefore rightly directed to be deleted by learned CIT(A).- Decided against revenue

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• 2017 (5) TMI 1360
  Addition on account of Long Term Capital Gains (LTCG) - sale of shop - transfer u/s 2(47) - Held that:- We find that the assessee is a member of co-operative housing society holding shop in the said society which was sold by him vide agreement to sale dated 9.2.2009 for a total consideration of 30.00 lakhs and a sum of 1.00 lakh was received as an advance with the signing of the agreement dated 9.2.2009. However, due to non fulfillment of terms of the agreement to sell qua the payment of balance amount the sale eventually took place in the assessment year 2010-11. The balance consideration of 29.00 lakhs was paid in the month of April, 2009 and the possession was handed over to the purchaser on 11.5.2009 as evidenced by a letter dated 11.5.2009 and also vide sale-com-assignment deed dated 11.5.2009. Thus the sale of shop has definitely taken place in the assessment year 2010-11 and not in the assessment year 2009-10 as has been observed and concluded by the AO and confirmed by the ld.CIT(A). Further the sale is covered under the provisions of section 2(47)(v) and not under the provisions of section 2(47)(vi) of the Act as has been held by the lower authorites. In the provisions of section 2(47)(v) the sale of property means allowing of the possession of any immovable property to be taken or retained in part performance of a contract, whereas under the provisions of section 2(47(vi) it has been mentioned that any transaction whether by way of becoming a member of, or acquiring shares in, a co-operative society, company or other association of persons or by way of any agreement or any arrangement or in any other manner whatsoever which has the effect of transferring, or enabling the enjoyment, of any immovable property is also sale. We also find that for a transfer of property in question the permission is required to be obtained from the CIDCO which was granted on 18.5.2009. Addition deleted - Decided in favour of assessee.

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• 2017 (5) TMI 1359
  TDS u/s 195 - disallowance u/s 40(a)(i) - overriding effect of section 172 - freight paid to non-resident shipping companies - Held that:- any person responsible for paying to a non-resident, not being a company, or to a foreign company, any interest or any other sum chargeable under the provisions of this Act not being income chargeable under the head "Salaries", would have to deduct the tax thereon at the rates in force. - While considering levy and recovery of tax in case of business carried on with aid of any ship belonging to or chartered by a non-resident which carries passengers etc. shipped at a port in India, then, tax must be computed and recovered in relation to such business of non-resident as per section 172 of the Act. - there is no warrant in applying the provisions in chapter XVII for collection and recovery of the tax and its deduction at source vide section 195. Vide Finance Act, 2008, w.e.f. 1.4.2008 sub-Section (6) has been inserted in Section 195 which requires the payer to furnish information relating to payment of any sum in such form and manner as may be prescribed by the Board. This provision is brought into force only from 1.4.2008. It will not apply for the period with which we are concerned in these cases before us We find that on the issue of the expenditure on so called commission and disallowance u/s 40(a)(i) of the Act, the Tribunal considered the decision in G.E. India Technology Centre Pvt. Ltd., CIT vs R.D. Agrawal & Co. (1964 (10) TMI 9 - SUPREME Court), Orient Goa Pvt. Ltd. (2009 (10) TMI 575 - Bombay High Court ), CST vs Indra Industries (2000 (1) TMI 44 - SUPREME Court), etc. and thereafter set-aside the matter to the file of the Assessing Officer for proper factual as well as legal determination. Both the parties before us agreed that on identical lines, the issue may be restored to the file of the ld. Assessing Officer. We may add here that ld. Assessing Officer is directed to consider Circular No.7/2009 (F.No.500/135/2007-FTD-I) dated 22/10/2009, wherein, earlier Circular No.23 dated 23/07/1969, No.163 Dated 29/05/1975 and Circular No.786 dated 07/02/2010 were withdrawn. The assessee be given opportunity to substantiate its claim. Thus, this ground is allowed for statistical purpose.

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• 2017 (5) TMI 1358
  ALP adjustment in respect of royalty payment made - MAM selected - Held that:- TPO had not applied TNMM at entity level. The TP study report submitted by the assessee company had been rejected by the TPO. This action of the TPO is confirmed by the Hon’ble DRP. But the TPO proceeded to bench mark the transaction of the royalty payment on stand alone basis. In the process, the cost of production or other transactions are not subjected to bench marking by the TPO. Therefore the contention of the ld. counsel that when the TNMM was applied at the entity level, there was no necessity of separate bench marking in respect of royalty transactions cannot be accepted. This submission made by the assessee-company is factually incorrect. On mere perusal of order of the ld. TPO it is manifest that the TPO had picked up the transaction royalty alone for the purpose of bench marking. The statement made by the ld. Counsel for the appellant is nothing but attempt to mislead the court. This conduct on the part of the counsel is highly deplorable. Ld. counsel chosen not to point out any fallacies in the reasoning of the TPO or of the ALP analysis in the working of the ALP adjustment. The ld. counsel also failed to establish that the transaction royalty payment is closely linked with the other transactions carried out with AE. It is trite law that a justification should be shown for clubbing the transactions. In the absence of such justification clubbing other transactions is not possible. The onus always lies on the assessee-company to establish the justification for clubbing and aggregation of the transaction of payment of royalty with other transactions. As mentioned (supra) the assessee-company had failed to discharge such onus, in the circumstances we confirm the orders of the lower authorities in this respect of ALP adjustment on payment of royalty. - Decided against assessee. Deduction u/s 10A - reduction of the expenditure incurred under telecommunication freight and travelling incurred in foreign currency from export turnover - Held that:- This issue is covered in favour of the assessee-company by the decision of the jurisdictional High court in case of Tata Elxsi Ltd [2011 (8) TMI 782 - KARNATAKA HIGH COURT ]. Respectfully following the decision of the order we direct the AO / TPO to exclude the expenditure from both export turnover and total turnover. These grounds of the appeal are allowed.

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• 2017 (5) TMI 1357
  Income from a let out house property determination - whether brokerage expenses, legal and professional fees, bank charges and electricity charges were necessarily required to be incurred for the enjoyment / use of the relevant property by the tenant and therefore, the annual value of the property should be taken after reducing such expenses which are directly attributed to the earning of rental income? - Held that:- We find that from the gross annual value, municipal taxes (including service taxes) levied by any local authority in respect of the house property are deducted. Municipal taxes are deductible only if (a) these taxes are borne by the owner, and (b) are actually paid by him during the previous year. The remaining amount left after deduction of municipal taxes is net annual value. As per provisions of section 24, the following two deductions are available:- a) Standard deduction; and b) Interest on borrowed capital The list of allowance of section 24 is exhaustive. In other words, no deduction can be claimed in respect of expenses on insurance, ground rent, land revenue, repairs, collection charges, electricity, water supply, salary of liftman etc. In the instant appeal, no dispute arose about payment of rent nor the tenants have filed any suit in the Court for fixation of standard rent nor the Court has passed any order fixing the rent. Respectfully following the judgement of the Hon'ble Delhi High Court in the case of H.G. Gupta and Sons (1983 (12) TMI 54 - DELHI High Court ), we dismiss ground no 1 to 4 of the assessee Clerical error in taking interest income - Held that:- The actual interest income received by the assessee can be verified from the TDS certificates. Therefore, the order of the learned CIT(A) relating to this ground of appeal is set aside and the same issue is restored to the file of the AO. We direct the AO to verify the TDS certificates and bring to tax the actual interest income as per the provisions of the Act. Needless to say, the AO would give a reasonable opportunity to the assessee to represent before him this issue.

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• 2017 (5) TMI 1356
  Initiation of proceedings u/s 153A - proof of incriminating material was found as a result of search conducted in the case of the assessee - addition u/s 68 - Held that:- In the present case, the assessee has been able to prove identity of the investors, their creditworthiness and genuineness of the transaction in the matter. Therefore, the authorities below should not have made or confirmed the addition of 5.75 crores in the hands of the assessee. In view of the above discussion, we set aside the orders of the authorities below and delete the addition DR in his written submissions referred to several documents which have been referred to CIT(A) in the impugned order to show various documents were found during the course of search in the case of the assessee. Therefore, it is not a case where no incriminating material found during the course of search. May be, this may not be relevant to the ultimate addition made on account of unexplained share application money received of 5.75 crores. Further, the search is conducted in the case of the assessee on 19.03.2012 and original return of income has been filed by the assessee after search on 30.03.2012. Therefore, there is no question of assessment already stood completed on the date of search. In view of the above sole reliance of the assessee on the decision Delhi High Court in the case of CIT vs Kabul Chawla (2015 (9) TMI 80 - DELHI HIGH COURT ) is clearly misplaced. This ground of appeal of the assessee has no merit, the same is accordingly dismissed - Decided partly in favour of assessee.

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• 2017 (5) TMI 1355
  Levy of fee u/s. 234E in order u/s.200A - appellant has filed TDS statement u/s. 200(3) beyond the prescribed due date - Held that:- - The adjustment in respect of levy of fees under section 234E was indeed beyond the scope of permissible adjustments contemplated under section 200A. The impugned levy of fees under section 234 E is unsustainable in law. We, therefore, uphold the grievance of the assessee and delete the impugned levy of fee under section 234E of the Act. - See case of Tanish Industries Pvt Ltd [2015 (11) TMI 1507 - ITAT AHMEDABAD].- Decided in favour of assessee

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• 2017 (5) TMI 1354
  Unrecorded sales/unrecorded business transactions and unrecorded payments etc. - search operations - addition on basis of loose papers - Held that:- CIT(A) grossly erred in confirming the addition as the assessee from the very beginning denied that loose papers belonged to him and that the presumption u/s 292C of the Act is rebuttable presumption and does not lead to a conclusive evidence. The assessee from the very beginning denied that the documents belonged to him and the AO made no effort to find out the real truth. It is not brought on record that the assessee was engaged in the business of gold or jewellery and earning the income from said business, the addition has been made by the AO by presuming that the assessee had made payments to the certain parties but in those documents which had been relied by the AO nowhere it is mentioned that the assessee purchased the gold and even the nature of the transaction is not clear because against certain payments, some quantity of gold has been written and against the others nothing is mentioned. Therefore, the addition made by the AO is only on the basis of surmises and conjecture without bringing any cogent material on record to substantiate that the assessee was engaged in the business of gold and jewellery and the AO had not brought any material on record to substantiate that the denial of the assessee was false. As during the course of search no unaccounted stock or assets were found. It is also noticed that in the assessee’s case search took place on 09.12.2005 and the seized material was with the AO who issued notice u/s 153A of the Act on 05.09.2007 but he did not make any enquiry during that period i.e. between 09.12.2005 and 05.09.2007, to ascertain as to whom the payments, if any, were made and how the assessee was related to those payments. On the contrary, the assessee denied the ownership of the document from the very beginning. We, therefore, considering the totality of the facts and by keeping in view the ratio laid down by the Hon’ble Jurisdictional High Court in the aforesaid referred to decision of Pr. CIT Vs M/s Delco India Pvt. Ltd. (2015 (7) TMI 47 - ITAT DELHI) are of the view that the addition made by the AO and sustained by the ld. CIT(A) was not justified. Accordingly, the same is deleted. - Decided in favour of assessee.

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• 2017 (5) TMI 1353
  Extension of stay for the recovery of demand - Held that:- We extend the stay for a period of 90 days or till the disposal of the appeal by Third Member whichever is earlier with the condition that the assessee shall give undertaking to the effect that assessee shall not transfer, dispose off, alienate or create any kind of third party interest in the fixed and immovable assets of the assessee-company, in order to secure the amount within 30 days from the date of the order.

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• 2017 (5) TMI 1352
  Transfer pricing adjustment in regard to AMP expenses - Held that:- As decided in the assessee’s own case for assessment year 2011-12 [2017 (5) TMI 1351 - ITAT DELHI] it would be in the fitness of things if the impugned order is set aside and the matter is restored to file of TPO/AO for fresh determination of the question as to whether there exists an international transaction of AMP expenses. If the existence of such an international transaction is not proved, the matter would end there and then, calling for no transfer pricing addition. If on the other hand, the international transaction is found to be existing, then the TPO will determine the ALP of such an international transaction in the light of the relevant judgments of the Hon’ble High Court in Sony Ericsson Mobile Communications (India) Pvt. Ltd. Vs. CIT [2015 (3) TMI 580 - DELHI HIGH COURT] after allowing a reasonable opportunity of being heard to the assessee. As relates to benefit of deduction under Section 80IC the same was claimed only for the unit situated in Rudrapur (Uttrakhand). There is net loss in the units of Manessar (Haryana) & Chennai (Tamilnadu) and there is a net profit in Rudrapur Unit. The TPO has only disallowed this claim as the assessee was not involved in manufacture of any item covered by Schedule XIV, where as the assessee has referred Schedule XIII and submitted that it is not considered by the TPO. After verifying Schedule XIII & XIV it is pertinent to note that the assessee’s location at Rudrapur is coming under the scope of 80IC but the address was not properly verified by the TPO. Therefore, this needs to be verified. We therefore, remit this issue back to the file of the TPO to examine the same as relates to the applicability of the Schedule XIII.

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• 2017 (5) TMI 1351
  Claim of deduction u/s 80IC - rejection of Books of Account and Non-submission of required documents/information - Held that:- The claim of deduction u/s 80IC is not eligible for deduction as the assessee has not submitted separate profit and loss account and balance sheet as per the provision of Rule 18BBB of the IT Rules. DR submitted that the AO has clearly held at para 4.9 that details were not submitted by the assessee and unit-wise books of account were not produced by the assessee. Deduction under section 80-IB - Held that:- Interest income on FDRs cannot be regarded as income flowing from business activity of industrial undertaking and, thus, it cannot be computed for deduction under section 80-IB. interest income on FDRs cannot be regarded as income flowing from business activity of industrial undertaking and, thus, it cannot be computed for deduction under section 80-IB. TPA - AMP adjustment - Held that:- In Sony Ericsson Mobile Communications (India) Pvt. Ltd. Vs. CIT (2015 (3) TMI 580 - DELHI HIGH COURT) in which the AMP expenses as an international transaction has been accepted. In another judgment in Sony Ericson Mobile Communications (India) Pvt. Ltd. (for A.Y. 2010-11 - 2016 (1) TMI 1234 - DELHI HIGH COURT), the question as to whether AMP expenses is an international transaction, has been restored for a fresh determination. We are of the considered opinion that it would be in the fitness of things if the impugned order is set aside and the matter is restored to file of TPO/AO for fresh determination of the question as to whether there exists an international transaction of AMP expenses. If the existence of such an international transaction is not proved, the matter would end there and then, calling for no transfer pricing addition. If on the other hand, the international transaction is found to be existing, then the TPO will determine the ALP of such an international transaction in the light of the relevant judgments of the Hon’ble High Court, after allowing a reasonable opportunity of being heard to the assessee. Benefit of deduction under Section 80IC the same was claimed only for the unit situated in Rudrapur (Uttrakhand). There is net loss in the units of Manessar (Haryana) & Chennai (Tamilnadu) and there is a net profit in Rudrapur Unit. The TPO has only disallowed this claim as the assessee was not involved in manufacture of any item covered by Schedule XIV, where as the assessee has referred Schedule XIII and submitted that it is not considered by the TPO. After verifying Schedule XIII & XIV it is pertinent to note that the assessee’s location at Rudrapur is coming under the scope of 80IC but the address was not properly verified by the TPO. Therefore, this needs to be verified. We therefore, remit this issue back to the file of the TPO to examine the same as relates to the applicability of the Schedule XIII. Needless to say, the assessee will be allowed a reasonable opportunity of being heard in such fresh proceedings Depreciation on capital subsidy - Held that:- The amount of capital subsidy was not received during the subject year as per the Ld. AR’s contention but the same needs to be verified. Therefore, we remit this issue back to the file of the TPO to examine the same.

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• 2017 (5) TMI 1350
  Penalty u/s.271(1)(c) - legality of notice issued u/s.274 r.w.s 271(1)(c) - Held that:- AO has not struck off either of one reason and has issued notice taking both the basis of imposing penalty by alleging that the assessee has concealed the particulars of income as well as furnishing inaccurate of income. Further in the penalty order framed u/s.271(1)(c) of Act Ld.AO has again quoted both the reasons i,e concealment of particulars of income and furnishing of inaccurate particulars of income for penalizing the assessee u/s.271(1)(c) of the Act. It can be inferred that Ld.AO was unable to make complete application of mind to assess the basis of imposing the penalty. Further Revenue, has been unable to prove that the impugned notice is not impaired or prejudice to the right of assessee for providing reasonable opportunity of being heard in order to defend its case for the specific reason for which penalty is imposed. Thus notice issued u/s.274 r.w.s 271(1)(c) of the Act, issued in the case of assessee was illegal and bad in laws as it is not specifying particular charge on which the penalty has been imposed i.e for concealment of particulars of income or furnishing inaccurate particulars on income and is therefore liable to be quashed. - Decided in favour of assessee.

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• Customs

• 2017 (5) TMI 1372
  Valuation - Import of crude oil - finalization of provisional assessment on the basis of transaction value - Held that: - Quantity actually received into shore tank in port in India should be the basis for payment of Customs duty - Quantity shown in bill of lading cannot be used for this purpose as it does not reflect quantity of goods at the time and place of importation - the lower authorities are directed to redetermine the customs duty by adopting the shore tank quantity as opposed to the Bill of Lading quantity. Demurrage charges - includibility - Held that: - the demurrage charges are admittedly incurred after the goods reached the Indian port and therefore it is a post-importation event. Such charges therefore cannot form part of the transaction value. Appeal allowed - decided partly in favor of appellant and part matter on remand.

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• 2017 (5) TMI 1371
  Refund of SAD - rejection for the reason that as certified by the Chartered Accountant, VAT/Sales Tax has been paid on the sales of Rock Phosphate imported since this item is exempted vide the Kerala Finance Act, 2011 notified vide N/N. 4175/Leg.A2/2011/Law dt. 08/11/2011 - whether the appellant will be eligible for payment of refund of SAD, by considering the NIL rate of VAT as appropriate payment of VAT? - Held that: - an identical issue came up before the Tribunal in the case of Gazal Overseas [2015 (12) TMI 427 - CESTAT NEW DELHI] in which the Tribunal allowed payment on refund of SAD - the condition prescribed in N/N. 102/2007 is satisfied and the appellant will be eligible for the refund of the SAD paid at the time of input - appeal allowed - decided in favor of appellant.

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• 2017 (5) TMI 1370
  Classification of exported goods - placemats, napkins and runners of composition 60%/70% silk and balance cotton - classified under heading 57025920 of the Customs Tariff, which covers “carpet and other floor coverings of silk” or otherwise? - Benefit of DEPB scheme - The appellant sought benefit of DEPB under DEPB group code 89 Sr.No.47C which entitles credit of DEPB @ 4.7% of the FOB value - Held that: - the shipping bill has the description of 70% silk and 30% cotton or 60% or 60% silk and 40% cotton. It is obviously a product, which is not covered by the description provided under DEPB entry 89/47C which reads “Made-ups made out of one or more manmade filament yarn with or without metalized yarn”. - it is likely that it was a clerical error on the part of the exporter. None the less there has been a violation of Section 113 (i) of the CA, in so far as wrong DEPB entry was claimed. The redemption fine is reduced from 20 lakhs to 2 lakh and penalty is reduced from 1 lakh to 10,000/- only - appeal allowed - decided partly in favor of appellant.

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• 2017 (5) TMI 1369
  Violation of conditions for goods imported at concessional rate of duty for manufacture - import of LCD Panel for use in their factory for manufacture of L.C.D. TVs - N/N. 21/2002-Cus. dated 01/03/2002 as amended - Held that: - for the period subsequent to the period of SCN the said Rules were amended wherein it was provided that the imported goods which could not be utilized can be re-exported. Though the said provision was not applicable to the period for which the SCN was issued, the principle involved in the said provision should be applicable for all the material periods - if the goods on importation are re-exported as such then they should be treated as if they were never imported. In that event, Rule 8 of the said Rules will not be applicable - appeal allowed - decided in favor of assessee.

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• Service Tax

• 2017 (5) TMI 1394
  CENVAT credit - Rule 6(3) of the CCR, 2004 - non-maintenance of separate books of accounts for trading as well as exempted goods - Held that: - The Original Authority held that the respondent is liable to follow one of the two options in terms of Rule 6(3) of CCR, 2004. The respondent followed second option and reversed the proportionate credit attributable to the exempted service, along with interest for delayed reversal of such credit - there is no reason to insist at the respondent should necessarily follow the first option of paying 6% of the value of exempted service - appeal dismissed - decided against Revenue.

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• 2017 (5) TMI 1393
  Business Auxiliary Services - commission received for marketing the goods of its foreign clients in India - demand - Held that: - The appellant submitted through the said letter dated 25.09.2009 that they were providing service to foreign clients and their activity amounted to export of service. Such aspect was not examined and the said SCN dated 20.10.2009 was issued wherein nowhere it was established that the commission received was in INR - SCN not sustainable - appeal allowed - decided in favor of appellant.

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• 2017 (5) TMI 1392
  Whether service tax is payable on the spare parts/consumables used in the service of motor vehicles by the appellant, who is an authorized service station of the manufacturer-Maruti Udyog Ltd.? - Held that: - Service tax is not payable on Spares & Consumable shown separately in the invoice and on which admissible VAT/Sales tax is charged or paid - demand set aside. Whether the appellant is required to pay service tax on the amount received from manufacturer for providing three free services to the customer, during the warranty period? - Held that: - Payment of bills, for free services, by manufacturer to servicing dealer is an internal arrangement and had nothing to do with the payment for services provided by the selling dealer to customers of car - service tax not payable. Whether the appellant is required to pay service tax on the amount of rent receivable shown in the books of account, admittedly not received? - Held that: - service tax was not chargeable at that time on the basis of raising of bills but was leviable only on the receipt of consideration for the service. Accordingly, we hold that no service tax is payable on the rent receivable, but admittedly not received by the appellant. - demand set aside. Appeal allowed - decided in favor of assessee.

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• 2017 (5) TMI 1391
  Refund claim - N/N. 41/2007-ST read with N/N. 17/2009-ST - time limitation - Held that: - One of the conditions appearing in clause (f) para 2 of the N/N. 17/2009-ST, is that claim for refund shall be availed within one year from the date of export of the said goods. Doubts have been expressed whether the applicability of this notification would be only with respect to such exports which have taken place after the issuance of this notification or would apply also to export prior to 07th July, 2009 - refund claims are filed within the stipulated period of one year, hence allowed. Refund claim - Terminal handling charges - Empty Container Offloading Charges - Transportation Charges (from ICD Delhi to ICD Dadri) - Documentation Charges - Held that: - CBEC had issued Circular No.354/256/2009-TRU dated 1st January 2010, vide which the issue no longer survives and the appellant is accordingly held entitled to refund on all the services including Custom House Agent Services. Appeal allowed - decided in favor of appellant.

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• 2017 (5) TMI 1390
  SSI exemption - clubbing of clearances - whether the Court below have rightly clubbed the turnover of these two appellants for the purpose of allowing the threshold exemption or SSI exemption? - whether for the purpose of calculating SSI Exemption under the classification of ‘Rent-a-Cab service’ operator where the gross receipts Form part of the aggregate value towards the taxable service, or the amount as reduced by the exemption allowed vide N/N. 1/2006-ST is to be considered? Held that: - the 2nd clause states ‘such gross amount’ actually qualifies the words “gross amount” in the 1st clause. Accordingly, it is evident that the gross amount prescribed the amount, not including payments received towards such gross amount, which are exempt from whole of the service tax leviable thereon, under section 65 of the Finance Act under any other notification. Further on reading N/N. 1/2006-ST, it is evident that the said notification exempts 60% of the gross receipts towards the service ‘Renting-a-Cab’, as defined in sub-clause ‘o’ of clause 105 of Section 65 of the Finance Act read with Section 66 of the Finance Act. Accordingly, I hold for calculating that for the purpose of determining the aggregate value for exemption under N/N. 6/2005-ST, only the net value received i.e. after the abatement under N/N. 1/2006-ST is to be considered. Secondly, I find that there is no proposal in the SCN for clubbing the turnover of these two appellants for the purpose of threshold exemption. Accordingly, I hold that the said clubbing is bad and further direct that the appellants are entitled to threshold exemption separately. The matter is remanded to the Adjudicating Authority for the limited purpose of calculating the net tax payable, if any, after implementing the orders and directions - appeal allowed by way of remand.

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• 2017 (5) TMI 1389
  Liability of tax - construction activities mainly non commercial structures - Held that: - in respect of all the residential units constructed for Ghaziabad authority, for the Ministry of Defense, and under JNNURM, none of the constructed blocks have got 12 or more units, attracting levy of service tax under Section 65(105) (zzzh) - the whole SCN is unsustainable and the demand as raised is bad and against the provisions of law - appeal allowed - decided in favor of appellant.

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• Central Excise

• 2017 (5) TMI 1388
  Valuation - includibility - related party transaction - whether the allegation of dealers sharing portion of the advertisement expenses, will constitute a extraneous consideration, in addition to the price charged and hence, whether such consideration will require to be included in the assessable value? Held that: - there is no evidence available to suggest that the appellants had made any additional charges for advertisement inextricably tied to the price to be paid for the goods cleared to the dealers. No corroboration is forthcoming or has been unearthed by Revenue to establish that the portion of advertisement charges paid by dealers was a subterfuge with the intent of dampening the assessable value and thereby evade dull duty liability. The impugned advertisement expenses cannot be termed as extraneous consideration to the price charged by the appellants which would require inclusion in their assessable value for the purpose of Section 4 or after 1.7.2000 - these expenses are not in the nature of any amount that the dealer is liable to pay to, or on behalf of the manufacturer by reason or in connection with the sale of motor vehicles. Appeal allowed in toto - decided in favor of appellant.

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• 2017 (5) TMI 1387
  CENVAT credit - credit availed during setting up of the plant - denial of CENVAT credit on the ground that at the time of taking credit, no dutiable goods was being manufactured - N/N. 30/2004-CE dated 09/07/2004 - Held that: - the input service received for the plant was used in the manufacture of dutiable goods - It is obvious that when the project work of renovation and modernization of the plant is undertaken, it takes some time and after gestation period, the plant comes into operation and whatever goods manufactured out of that plant is cleared on payment of duty. Therefore, the credit in respect of the services, which is related to the said renovation and modernization is clearly admissible to the appellants - credit allowed - decided in favor of appellant.

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• 2017 (5) TMI 1386
  Valuation - the appellant was clearing their final products on payment of duty to their depot at Navi Mumbai for onward sale to the wholesale dealers - Held that: - For determining assessable value in such cases, the CBEC has also issued a Circular No.251/85/96-CX dt. 14/10/1996 wherein it was clarified that the price prevailing at the depot on the day of clearance from the factory is to be taken as the assessable value and in such case, if the price is not available, then the price at the time nearest to the time of removal of the goods is to be taken as assessable value - demand attributable to those invoices whose date taken by the Department is subsequent to the date of clearance from the factory cannot be sustained. Consequently, we are constrained to set aside demand amounting to 14,61,527/-. Extended period of limitation - Held that: - while submitting the details of depot invoices where refund was admissible, they have concealed the details of clearances in respect of which depot price sale was higher than the stock transfer value - also, appellant has failed to mention the fact that they were adopting the price listed in their website and the fact came to the notice only when the Departmental officers visited the factory and carried out investigations - the demand does not merit setting aside on the ground of time bar. Penalty - Held that: - The controversy in the present case is pertaining to the period immediately after commencement of manufacture by the appellant in their Bangalore factory. Consequently, we are of the view that there is no justification for imposition of penalty on the appellant and hence the same is set aside. The demand is upheld to the extent of 22,61,058/-. The balance of demand amounting to 14,61,527/- is set aside. The amount of demand already paid by the appellant is liable to be appropriated - Interest will be liable to be paid at the applicable rate - Penalty imposed is set aside - appeal allowed - decided partly in favor of assessee.

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• 2017 (5) TMI 1385
  Petroleum products - deemed exports - supply to EOU - demand of duty on stock after withdrawing warehousing benefit - Held that: - it is the admitted position that the goods lying in stock at the installation are cleared only to KDPP and KPCL who are entitled to exemption based on end-use certificate and this fact is admitted in para 15 of the impugned order - the impugned goods are eligible for exemption at the time of removal thereof from the installation and no duty is payable on the quantity lying in stock at the installation consequent to withdrawal of warehousing facility - appeal allowed - decided in favor of assessee.

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• 2017 (5) TMI 1384
  Imposition of penalty - case of appellant is that their case is covered by the provisions of Sub-section 2B of Section 11A of CEA, 1944 and as provided in said Sub-section, there was no need for issuance of present SCN and had there been no SCN, the question of imposition of penalties did not arise - Held that: - the said Sub-section (2B) of Section 11A of CEA, 1944 provides that ‘when an assessee on his own ascertainment pays the amount of duty and interest thereon before issue of SCN, then SCN demanding the said amount cannot be served on the assessee’ - the SCN has not at all dealt with the aspect as to why the assessee’s present case is not covered by the provisions of said Sub-section (2B) of Section 11A of CEA, 1944 and how the demand of 43,46,542/- is tenable in spite of provisions of Sub-section (2B) of Section 11A of CEA, 1944 - appeal allowed - decided in favor of appellant.

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• 2017 (5) TMI 1383
  100% EOU - CENVAT Credit of the duty paid on export invoices without filing any rebate/refund claim - time limitation - Held that: - the appellant clearly intimated about their taking re-credit in their Cenvat Account - Despite the clear intimation given by the appellant to the department, the department took 3 years to issue the SCN, which was issued on 17.10.2011 - Since the appellant disclosed the fact about taking re-credit, there is absolutely no suppression of the fact on part of the appellant - SCN issued after 3 years is clearly time barred - appeal allowed on the ground of limitation - decided in favor of appellant.

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• 2017 (5) TMI 1382
  CENVAT credit - duty paying invoices - whether the CENVAT Credit in respect of Service Tax paid on the rent of the premises is admissible on the debit note issued by the premises owner? - Held that: - the debit note on which the credit was availed has contained all the information which is required in terms of Rule 4 of the STR, 1994 - reliance was placed in the case of Vodafone Essar Spacetel Ltd. [2016 (1) TMI 24 - CESTAT KOLKATA], where it was held that any document which contains the details prescribed u/r 4A(1) of the STR, 1994, the same can be considered as the invoice or challan and will be a proper document for availing the CENVAT Credit - appeal allowed - decided in favor of appellant.

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• 2017 (5) TMI 1381
  Valuation - includibility - whether the excise duty paid on inputs and notional profit is liable to be added in the assessable value of the final products manufactured and cleared by the appellant? - Held that: - regarding the issue of inclusion of notional profit, no amount on account of profit can be added - since this factual aspect which observed by the Commissioner (Appeals) was not raised right from the SCN stage, at this stage, it is impractical for the appellant to come out with the Cost Accountant’s certificate, therefore, even on the basis of cost certified by the appellant can be accepted subject to the correctness of the data on the basis of Books of Account - appeal allowed by way of remand.

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• 2017 (5) TMI 1380
  Levy of duty - The respondent is engaged in the manufacture of various gases such as Oxygen, Nitrogen, Argon etc. - Due to technical reasons, some quantities of such gases sent through pipeline to the recipient was vented out into atmosphere. The Department wanted to levy duty of excise on such quantities of gases - Held that: - the same issue pertaining to the very same appellant for an earlier period [2012 (8) TMI 825 - CESTAT BANGALORE] had come up before this Tribunal wherein the issue was decided in favour of the respondent. It was held that gases which were vented out in the atmosphere are exempted from excise duty - duty not leviable - appeal dismissed - decided against Revenue.

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• 2017 (5) TMI 1379
  100% EOU - CENVAT credit of education cess, as well as secondary and higher education cess paid on the basic excise duty - Rule 3 of CCR, 2004 - Held that: - Rule 3 of CCR, 2004 specifically lists the duties that can be availed as credit. Though the aggregate of duties of customs is collected as an amorphous duty of excise, the specific reference to the Central Excise Tariff Act, 1985 in the rule excludes the availment of the totality of excise duty paid by Export Oriented Units as credit - The availment of credit to the extent specified in the notice issued to the appellant is incorrect and the impugned order is correct in law. Penalty - Held that: - the availment of ineligible credit had arisen from apparent confusion about the nature and composition of the levy - availment does not appear to have been motivated by intent to evade duties - penalty set aside. Appeal allowed - decided partly in favor of appellant.

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• 2017 (5) TMI 1378
  CENVAT credit - scope of input service - services related to handling of goods outside the factory, but up to and until export of goods - Held that: - the goods are permitted to be deposited without payment of duty at the port of export, it would appear that the ‘place of removal’ in relation to exported goods is not the factory but beyond. Any service used till the place of removal would qualify as an ‘input service.’ There can be no cavil about the availment of credit of any tax that has been paid in connection with such input services. There can be no dispute that the services on which credit of tax paid was taken had been rendered to the respondent. It would also be natural for any assessee to take the credit of any tax that has already been paid in connection with their business activities. To the extent that this credit has been taken on services that are not ineligible for inclusion as ‘input services’, the availment of credit cannot be objected to. Appeal dismissed - decided against Revenue.

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• 2017 (5) TMI 1377
  Validity of ex-parte Final Order - natural justice - Held that: - in the interest of justice, we allow this miscellaneous application for recall of the Final Order dated 09th April, 2015 for this applicant/appellant M/s Chandravati Polymers Pvt. Ltd., subject to cost imposed of 50,000/- to be paid in ‘Prime Minister National Relief Fund’ - appeal restored.

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• 2017 (5) TMI 1376
  Validity of SCN - Held that: - once a SCN is issued by invoking the provisions for extended period on the basis of suppression of facts then the same facts cannot be the grounds for issue of subsequent SCN invoking proviso for extended period - Since the entire records on the basis of which both the SCN were issued came within the knowledge of Revenue on 11/03/2003, the impugned SCN dated 30/12/2003 is not tenable - appeal dismissed - decided against Revenue.

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• 2017 (5) TMI 1375
  Valuation - Applicability of Rule 7 of Central Excise Valuation (Determination of Price of Excisable Goods) Rules, 2000 - The goods manufactured were both sold at the factory gate and were also transferred to consignment agent - case of appellant is that Rule 7 is applicable only when all the goods manufactured by a manufacturer are sold only through depots and since in the present case all the goods are not sold through depot, therefore, the order passed by ld. Commissioner (Appeals) may be set aside - Held that: - some of the goods were sold by the appellant at the factory gate - provisions of Rule 7, were not applicable in the present case - appeal allowed - decided in favor of assessee.

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• 2017 (5) TMI 1374
  CENVAT credit - Rule 3 (5A) of the CCR, 2004 - removal of Brass Tubes - removal as such or as waste? Held that: - the appellant have removed used Brass Tubes as ‘Brass Tubes’ and not as ‘waste and scrap’. In this view of the matter, the provisions of Rule 3 (5A) of the CCR, 2004, are not attracted - appeal allowed - decided in favor of appellant.

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• 2017 (5) TMI 1373
  CENVAT credit - diverted billets/slabs - penalty u/r 57AH(2) read with Section 173Q of CER, 1944 and Rule 13 to of CCR, 2001 - clandestine removal of billets - Held that: - the inputs in questions were procured from SAIL and duty was paid. Both HML & MSL were independently entitled to purchase the inputs and avail credit on the same. There was no apparent gain for HML to purchase the input and avail credit and divert the said duty paid inputs to MSL. The Revenue failed to demonstrate any benefit accruing to HML or MSL, due to indulgence in such practices. Admittedly both the companies are under the same management and are closely held companies. Clandestine manufacture and removal of 7,651.817 MT of MS Strips - Held that: - The basis for the demand raised appears illogical, as no apparent benefits is shown to have accrued to either of the appellants. The sending of goods on job work by M/s HML to M/s MSL was duly intimated to Revenue vide letter dated 02/01/2002. A confirmation letter dated 18/03/2002 was issued by Assistant Commissioner, to this fact (brought on record by appellants). Further appellants have led evidence that Mr. S. K. Tyagi had retracted his statement within a few days vide letters dated 17/04/2002 & 22/04/2002 addressed to the D. G. of DGCEI, New Delhi. The contention of Revenue that factory of M/s MSL was running for 7 more hours, than declared, is untenable, being based only on the basis of statements of some employee. The same does not stand in view of order dated 18/03/1998 passed by commissioner of Central Excise, Kanpur, determining the Annual Capacity of production at 17 MT per day. Further under the facts and circumstances, extended period of limitation is not invokable. The impugned order is also bad and unsustainable for non-compliance of the provisions of Section 9 D of the Act. The case of Revenue is not proved and the allegations are sham and illusory and Show Cause Notice is not maintainable - appeal allowed - decided in favor of assessee.

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• CST, VAT & Sales Tax

• 2017 (5) TMI 1397
  Natural justice - validity of reassessment order - it is the case of the petitioner that the petitioner gave their written submission and wanted personal hearing, but this personal hearing has been denied to them and, therefore, the imposition of liability without granting them opportunity of hearing is unsustainable - Rule 24 of the Rules - Held that: - the Rule only contemplates issuance of show cause notice and hearing by granting opportunity of submission of documents. There is nothing in this rule which suggests that a personal hearing as claimed by the petitioner has to be granted - it is not a case where per se on the basis of the material available on record, a categorical finding can be recorded that the petitioner was not granted any opportunity of hearing and ex parte order was passed behind their back. On the contrary, the documents do indicate prima facie that opportunity of hearing was extended to the petitioner and the petitioner through their counsel did avail of this opportunity. This is not a fit case where exercising extra-ordinary jurisdiction of this Court, the matter could be interfered with right away in a petition under Article 226 of the Constitution, instead it is a case where petitioner should take recourse to the statutory remedy of appeal available where all these issues can be sorted out on a decision taken - petition dismissed - decided against petitioner.

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• 2017 (5) TMI 1396
  Penalty - suppression in payment of sales-tax under the KGST Act, 1963 - case of appellant is that the levy of works contract tax and the penalty thereon is beyond the legislative competence and powers of the State of Kerala and therefore there cannot be any levy of tax or penalty under the KGST Act - Held that: - it is rather clear that the liability to pay tax would arise only if the goods are used in a works contract - the terms of the contract clearly envisages that the goods are brought to the State by interstate movement, it gets terminated at the work site resulting in completion of interstate sale envisaged under the CST Act - this is a case in which penalty had been imposed on the assessee under Section 45A of the KGST Act. Penalty can be imposed only if there is deliberate suppression of turnover. In the light of the principles laid down, the question to be considered is whether there was deliberate contumacious conduct on the part of the assessee in declaring the goods as exigible for tax under the works contract - the matter is remitted back to the 1st respondent for fresh consideration of the revision petition - petition allowed by way of remand.

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• Indian Laws

• 2017 (5) TMI 1395
  Claim for directing the authorities to relax and promotion to the post of Inspector (Central Excise) rejected - Held that:- Neither the petitioner can claim relaxation of Rules as a matter of right nor he has made out a case of discrimination. The petitioner could be heard complaining denial of relaxation only if such a discretionary benefit was extended to similarly placed employee(s). The competent authority has not granted relaxation to any individual. It is only as a matter of policy that the employees belonging to specified Tribes and communities have been granted height relaxation to which the petitioner admittedly does not belong. Similarly, the petitioner cannot claim parity with differently-abled persons who constitute a separate and distinct class under the provisions of the Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995. Petition dismissed.

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