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Newsletter: Where Service Meets Reader Approval. TMI Tax Updates - e-Newsletter July 6, 2019 Case Laws in this Newsletter: GST Income Tax Customs Insolvency & Bankruptcy Service Tax Central Excise CST, VAT & Sales Tax Indian Laws TMI SMS Budget 2019-20 + FINANCE (No. 2) BILL, 2019 with Focused Areas i.e Explanatory Notes TMI Short Notes Bill: Rates for deduction of income-tax at source from “Salaries”, computation of “advance tax” and charging of income-tax in special cases during the financial year 2019-20. Bill: Rate of Tax for TDS / Advance Tax - Individual, Hindu undivided family, association of persons, body of individuals, artificial juridical person. Bill: Rate of Tax for TDS / Advance Tax - Co-operative Societies Bill: Rate of Tax for TDS / Advance Tax - Firms Bill: Rate of Tax for TDS / Advance Tax - Local authorities Bill: Rate of Tax for TDS / Advance Tax - Companies Bill: WIDENING AND DEEPENDING OF TAX BASE - Tax Deduction at Source (TDS) on payment by Individual/HUF to contractors and professionals Bill: TDS at the time of purchase of immovable property Bill: Deemed accrual of gift made to a person outside India Bill: Mandatory furnishing of return of income by certain persons Bill: Inter-changeability of PAN & Aadhaar and mandatory quoting in prescribed transactions. Bill: Consequence of not linking PAN with Aadhaar Bill: Widening the scope of Statement of Financial Transactions (SFT) Bill: MEASURES FOR PROMOTING LESS CASH ECONOMY - Prescription of electronic mode of payments Bill: TDS on cash withdrawal to discourage cash transactions Bill: Mandating acceptance of payments through prescribed electronic modes Bill: TAX INCENTIVES - Incentives to International Financial Services Centre (IFSC): Bill: Incentives to Non-Banking Finance Companies (NBFCs) Bill: Relaxation in conditions of special taxation regime for offshore funds Bill: Tax incentive for electric vehicles Bill: Exemption of interest income of a non-resident arising from borrowings by way of issue of Rupee Denominated Bonds referred to under section 194LC Bill: Tax incentive for affordable housing Bill: Incentives to National Pension System (NPS) subscribers Bill: Incentives for start-ups Bill: Incentives for Category II Alternative Investment Fund (AIF) Bill: FACILITATING RESOLUTION OF DISTRESSED COMPANIES - Measures for resolution of distressed companies Bill: Prescription of exemption from deeming of fair market value of shares for certain transactions Bill: IMPROVING EFFECTIVENESS OF TAX ADMINISTRATION - Online filing of application seeking determination of tax to be deducted at source on payment to non-residents Bill: Electronic filing of statement of transactions on which tax has not been deducted Bill: STRENGTHENING ANTI-ABUSE MEASURES - Tax on income distributed to shareholder in case of listed companies Bill: Cancellation of registration of the Trust or Institution Bill: REMOVING DIFFICULTIES FACED BY TAX PAYERS - Facilitating demerger of Ind-AS compliant companies Bill: Relaxing the provisions of sections 201 and 40 of the Act in case of payments to non-residents Bill: Clarification with regard to power of the Assessing Officer in respect of modified return of income filed in pursuance to signing of the Advance Pricing Agreement (APA) Bill: Clarification with regard to provisions of secondary adjustment and giving an option to assessee to make one-time payment Bill: Concessional rate of Short-term Capital Gains (STCG) tax to certain equity-oriented fund of funds. Bill: Provide for pass through of losses in cases of Category I and Category II Alternative Investment Fund (AIF) Bill: Provision of credit of relief provided under section 89 Bill: TDS on non exempt portion of life insurance pay-out on net basis. Bill: Clarification regarding definition of the “accounting year” in section 286 of the Act Bill: Rationalisations of provisions relating to maintenance, keeping and furnishing of information and documents by certain persons Bill: Compliance with the notification of exemption issued under section 56(2)(viib) Bill: Consequential amendment to section 56 Bill: Rationalisation of penalty provisions relating to under-reported income Bill: Rationalisation of the provisions of section 276CC Bill: Rationalisation of provision relating recovery of tax in pursuance of agreements with foreign countries Bill: Rationalisation of provisions relating to claim of refund. Bill: Rationalisation of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 Bill: Rationalisation of the Income Declaration Scheme, 2016 Bill: Rationalisation of provisions relating to STT Bill: Rationalizing the provisions of the Prohibition of Benami Property Transactions Act Bill: Extension of tax concession to The Special Undertaking of the Unit Trust of India (SUUTI) Bill: Amendments in Customs - FINANCE (No.2) BILL, 2019 Bill: AMENDMENTS IN THE CUSTOMS ACT, 1962 - FINANCE (No.2) BILL, 2019 Bill: AMENDMENTS IN THE CUSTOMS TARIFF ACT, 1975 - FINANCE (No.2) BILL, 2019 Bill: AMENDMENTS IN THE FIRST SCHEDULE TO THE CUSTOMS TARIFF ACT, 1975 - FINANCE (No.2) BILL, 2019 Bill: PROPOSALS INVOLVING CHANGES IN BASIC CUSTOMS DUTY RATES AND CLARIFICATORY AMENDMENTS IN RESPECTIVE NOTIFICATIONS - FINANCE (No.2) BILL, 2019 Bill: PROPOSALS INVOLVING CHANGES IN EXPORT DUTY RATES - FINANCE (No.2) BILL, 2019 Bill: AMENDMENT IN THE SIXTH SCHEDULE TO THE FINANCE ACT, 2018 - Customs - FINANCE (No.2) BILL, 2019 Bill: Effective change in rate of Road and Infrastructure Cess on Petrol and Diesel - FINANCE (No.2) BILL, 2019 Bill: RETROSPECTIVE AMENDMENTS OF RATE NOTIFICATIONS - Customs - FINANCE (No.2) BILL, 2019 Bill: Miscellaneous changes in Customs - FINANCE (No.2) BILL, 2019 Bill: Amendments in Excise - FINANCE (No.2) BILL, 2019 Bill: AMENDMENTS IN THE FOURTH SCHEDULE TO THE CENTRAL EXCISE ACT, 1944 - FINANCE (No.2) BILL, 2019 Bill: PROPOSALS INVOLVING CHANGE IN EXCISE DUTY RATES THROUGH NOTIFICATIONS - FINANCE (No.2) BILL, 2019 Bill: AMENDMENT IN THE EIGHTH SCHEDULE TO THE FINANCE ACT, 2002 - FINANCE (No.2) BILL, 2019 Bill: AMENDMENT IN THE SIXTH SCHEDULE TO THE FINANCE ACT, 2018 - FINANCE (No.2) BILL, 2019 Bill: Effective change in rate of Special Additional Excise Duty and Road and Infrastructure Cess on Petrol and Diesel - FINANCE (No.2) BILL, 2019 Bill: SERVICE TAX - FINANCE (No.2) BILL, 2019 Bill: Sabka Vishwas Legacy Dispute Resolution Scheme - FINANCE (No.2) BILL, 2019 Bill: Goods and Services Tax - FINANCE (No.2) BILL, 2019 Bill: AMENDMENTS IN THE CGST ACT, 2017 - FINANCE (No.2) BILL, 2019 Bill: AMENDMENTS IN THE IGST ACT, 2017 - FINANCE (No.2) BILL, 2019 Bill: Retrospective Amendments of GST rate notifications - FINANCE (No.2) BILL, 2019 Articles Budget 2019 CENTRAL GOODS AND SERVICES TAX (FOURTH AMENDMENT) RULES, 2019 – AN OVERVIEW The Power of Self Motivation News Over 90 Percent Refund Claims Disposed by CBIC Extension of Last Date for availing the benefit of Alternate Composition Scheme from 30.04.2019 to 31.07.2019 Union Budget 2019-20 reinvigorates sustainable and equitable growth, says Chief Statistician of India and Secretary, Ministry of Statistics & programme Implementation FDI inflows into India remained robust in 2018-19 DD channel for start-ups Key Highlights of Union Budget 2019-20 Budget 2019-20 + FINANCE (No. 2) BILL, 2019 Several tax proposals aim to promote investments in start-ups and sunrise industries in the country India’s 10- point ‘Vision for the Decade’ flagged in Budget 2019-20 Budget Speech 2019-2020 Policy Measures to promote Growth and Employment Generation in Indian Economy Tax rates for individuals having taxable income from ₹ 2 cr - 5 cr and ₹ 5 cr & above to be increased by around 3 % and 7 % respectively Union Budget proposes number of measures to enhance the sources of capital for infrastructure financing Union Budget proposes measures to deepen Corporate Debt markets Union Budget envisions India as a global hub for manufacturing electric vehicles Union Budget proposes creation of a social stock exchange- under the regulatory ambit of Securities and Exchange Board of India (SEBI) for listing social enterprises and voluntary organizations Public Sector Banks proposed to be provided ₹ 70,000 crore capital to boost credit Providing access to safe and adequate drinking water to all Indians is a priority of the Government Union Budget stresses the need for heavy investment in infrastructure, Digital Economy and job creation in small and medium firms Government to consider issuing Aadhaar Card for NRIs with Indian Passports Lower rate of 25 % Corporate Tax extended to companies with Annual Turnover up to ₹ 400 crore from earlier cap of upto ₹ 250 crore All necessary steps to be taken to meet public shareholding norms of 25% for all listed PSUs Union Budget proposes permitting 100% Foreign Direct Investment (FDI) for insurance intermediaries Easing of Local Sourcing. Government sets enhanced target of ₹ 1,05,000 crore of disinvestment during 2019-20 Strategic disinvestment of Air India proposed to be reinitiated More CPSEs proposed for strategic participation by private sector Expert Committee to be set up to recommend the structure and required flow of funds through development finance institutions Outlay on Major Schemes India to move towards harnessing its space capability commercially, New Space India Limited (NSIL) incorporated towards this end Expenditure Receipts Budget Profile Transfer of Resources to States and Union Territories with Legislature Deficit Statistics Budget at a Glance Pradhan Mantri Awas Yojana – Gramin (PMAY-G) aims to achieve the objective of Housing for all by 2020 Union Budget proposes PPP to unleash faster development and completion of tracks, rolling stock manufacturing and delivery of passenger freight services Budget Highlights (Key Features) Union Budget Proposes Strengthening MSMEs to Boost Make in India Government to encourage and facilitate role of women in India’s growth story Stand-Up India Scheme extended till 2025 Start-ups and their investors filing requisite declarations not to be subjected to any scrutiny regarding valuations of share premiums Government to bring greater ease of living through technology GST processes further simplified; businesses with less than ₹ 5 crore annual turnover to file quarterly GST returns; threshold for goods supplier to be enhanced from ₹ 20 lakhs to ₹ 40 lakhs ₹ 400 Cr allocated for creating world class educational institutions Scheme of Fund for Upgradation and Regeneration of Traditional Industries (SFURTI) aims to set up more Common Facility Centres for generating sustained employment opportunities THE FINANCE (NO.2) BILL, 2019 MEMORANDUM FINANCE (No.2) BILL, 2019 Inviting applications for filling up of one Post of Member in the Competition Commission of India Notifications Central Excise 06/2019 - dated 6-7-2019 - CE Seeks to exempt crude petroleum oil produced in specified oil fields under production sharing contracts or in the exploration blocks offered under the New Exploration Licensing Policy (NELP) through international competitive bidding. 05/2019 - dated 6-7-2019 - CE Seeks to increase the effective rate of Special Additional Excise Duty on Petrol and Diesel. 04/2019 - dated 6-7-2019 - CE Seeks to increase the effective rate of Road and Infrastructure Cess as additional duty of excise on Petrol and Diesel. 03/2019 - dated 6-7-2019 - CE Seeks to increase the basic excise duty on specified goods in chapter 24 under section 5A of the Central Excise Act 1944. 02/2019 - dated 6-7-2019 - CE Seeks to further amend notification No. 11/2017-Central Excise dated 30th June 2017 so as to omit an entry with respect to chapter 24. Customs 27/2019-Customs - dated 6-7-2019 - Cus Seeks to further amend notification No 27/2011-Customs dated 1st March 2011 to reduce the export duty on EI tanned leather and Hides, skins and leathers, tanned and untanned, all sorts. 26/2019-Customs - dated 6-7-2019 - Cus Seeks to further amend notification No 14/2006-Customs dated 1st March 2006 in order to change the classification of other dyed fabrics of nylon from “5407 42 00” to “5407 42” 25/2019-Customs - dated 6-7-2019 - Cus Seeks to further amend notification No 50/2017-Customs dated 30th June, 2017 so as to prescribe effective rate of Basic Customs Duty (BCD). 24/2019-Customs - dated 6-7-2019 - Cus Seeks to further amend notification No 57/2017-Customs dated 30th June, 2017 to explicitly exclude the specified electronic items from scope of entry at S.No.6A of the notification and to provide the effective rates on other goods. 23/2019-Customs - dated 6-7-2019 - Cus Seeks to further amend notification No 25/2005-Customs dated 1st March, 2005 to explicitly provide BCD exemption on the specified parts of line telephone handset. 22/2019-Customs - dated 6-7-2019 - Cus Seeks to further amend notification No 25/2002-Customs dated 1st March, 2002 to exempt specified capital goods use for manufacture of specified electronic items. 21/2019-Customs - dated 6-7-2019 - Cus Seeks to further amend notification No 25/98-Customs dated 2nd June 1998 to update the classification of the goods in the notification. 20/2019-Customs - dated 6-7-2019 - Cus Seeks to further amend notification No. 52/2017-Customs dated 30th June 2017 so as to increase the effective rate of Basic Customs Duty on petroleum crude. 19/2019-Customs - dated 6-7-2019 - Cus Exemption to specified defense equipment and their parts imported in India by the Ministry of Defence, Government of India or the defence forces 18/2019-Customs - dated 6-7-2019 - Cus Effective rate of ROAD AND INFRASTRUCTURE CESS - additional duty of customs leviable thereon u/s 111 of Finance Act, 2018 Circulars / Instructions / Orders Service Tax 213/3/2019 - dated 5-7-2019 Provisions in the Cenvat Credit Rules 2004 regarding reversal of credit GST CBEC/20/16/4/2018-GST (Pt. I) - dated 1-7-2019 Corrigendum to Circular No. 97/16/2019-GST dated 5th April, 2019 issued vide F. No. CBEC/20/16/4/2018-GST (Pt. I) DGFT 16/2015-2020 - dated 4-7-2019 Implementation of the Track and Trace system for export of Pharmaceuticals and drug consignments alongwith maintaining the Parent-Child relationship in the levels of packaging and their movement in supply chain — Extension of date of implementation 17/2015-2020 - dated 4-7-2019 Issue of Advance Authorization where import item is 'Pulses' and/or 'Peas' of any kind falling under restricted/prohibited category Customs D.O.F.No. 334/3/2019-TRU - dated 5-7-2019 D.O. Letter from JS(TRU-I) Highlights / Catch Notes GST Levy of IGST on Ocean Freight - Vires of Notification No. 8/2017-IGST - no coercive steps shall be taken against the petitioner pursuant to the impugned notification in the meanwhile. Visit to Get Source Income Tax Compensation received for foregoing the rights to sue against purchase of property - revenue or capital receipt - Once the compensation is held to be is only on account of foregoing right to sue, which is a right in personam the same cannot be brought to tax Visit to Get Source Penalty U/s 271AAB - red diary found in search, wherein there are notings relating to cash advances given - as per the definition of undisclosed income u/s 271AAB, the said cash advance cannot be stated to be income which is represented by any money, bullion, jewellery or other valuable article or thing - no penalty Visit to Get Source Disallowing hoarding construction charges - huge expenses - long term utility - such expenditure is a recurring expenditure which is required to be incurred by the assessee regularly and the same therefore cannot be said to have given any enduring benefit to the assessee in capital field - allowed as revenue expenses Visit to Get Source Penalty u/s 271(1)(c) - agreed addition based on statement in survey u/s 133A - since the assessee has explained the circumstances under which the addition in question has been made and further established that the explanation is bonafide and it has disclosed all the facts material to the computation of its total income - no penalty Visit to Get Source Addition regarding Cash deposit in Bank Account - based on AIR Information - when there is no evidence with the Revenue that the withdrawals made by the assessee systematically from the bank account have been utilized for some other purpose other than for the unaccounted business of the assessee then the assessee should be given the benefit of peak credit theory and only the peak credit has to be sustained Visit to Get Source Dividend distribution Tax (DDT) - buy back its own shares - distribution of accumulated profit - Section 115O is a charging section on its own and they do not demand for issuing any show cause notice and then passing any order - unless the law requires, the AO need not issue notice before making a demand u/s 115O Visit to Get Source Allowability of consultancy fees - financial advisory services for restructuring of its loan which able to reduce the interest rate - expenditure incurred had nothing to do with the expansion of the capital base of the company - it was for restructuring of its loan and was by way of a revenue expenditure Visit to Get Source Customs Amend notification No 27/2011-Customs to reduce the export duty on EI tanned leather and Hides, skins and leathers, tanned and untanned, all sorts. Visit to Get Source Amends notification No 14/2006-Customs in order to change the classification of other dyed fabrics of nylon from “5407 42 00” to “5407 42” Visit to Get Source Amend notification No 50/2017-Customs so as to prescribe effective rate of Basic Customs Duty (BCD). Visit to Get Source Amends notification No 57/2017-Customs to explicitly exclude the specified electronic items from scope of entry at S.No. 6A of the notification and to provide the effective rates on other goods. Visit to Get Source Amends notification No 25/2005-Customs to explicitly provide BCD exemption on the specified parts of line telephone handset. Visit to Get Source Amends notification No 25/2002-Customs to exempt specified capital goods use for manufacture of specified electronic items. Visit to Get Source Amends notification No 25/98-Customs to update the classification of the goods in the notification - Effective rate of customs duty on certain goods Visit to Get Source Amends notification No. 52/2017-Customs so as to increase the effective rate of Basic Customs Duty on petroleum crude Visit to Get Source Exemption to specified defense equipment and their parts imported in India by the Ministry of Defence, Government of India or the defence forces Visit to Get Source Effective rate of ROAD AND INFRASTRUCTURE CESS - additional duty of customs leviable thereon u/s 111 of Finance Act, 2018 Visit to Get Source Indian Laws Budget 2019-20 + FINANCE (No. 2) BILL, 2019 with Focused Areas i.e Explanatory Notes Visit to Get Source THE FINANCE (NO.2) BILL, 2019 Visit to Get Source IBC Permission to withdraw the Corporate Insolvency Resolution Process (CIRP) - The resolution for withdrawal of CIRP did not obtain the required percentage of voting by the members of CoC, i.e. 90% at the first instance. Subsequently, a CoC meeting was conducted, and a resolution was voted upon for reconsideration of the withdrawal. The RP/CoC has not quoted the exact provision that empowers them to again put for the voting of the resolution which was earlier defeated. Visit to Get Source Central Excise Seeks to exempt crude petroleum oil produced in specified oil fields under production sharing contracts or in the exploration blocks offered under the New Exploration Licensing Policy (NELP) through international competitive bidding. Visit to Get Source Seeks to increase the effective rate of Special Additional Excise Duty on Petrol and Diesel. Visit to Get Source Seeks to increase the effective rate of Road and Infrastructure Cess as additional duty of excise on Petrol and Diesel. Visit to Get Source Seeks to increase the basic excise duty on specified goods in chapter 24 under section 5A of the Central Excise Act 1944. Visit to Get Source Amend notification No. 11/2017-Central Excise so as to omit an entry with respect to chapter 24 - Effective Rate of Duty of excise Visit to Get Source Classification of goods - PVC Pipes - product is classifiable under 3917.39 i.e. the hollow pipes for which no other classification in the said chapter Visit to Get Source CENVAT Credit - inputs - CR sheets dies, etc - Merely adding the word ‘rejected scrap’ in the invoice cannot be the reason to say that the goods were not received by the appellant and there is no such evidence placed on record by the Revenue. Visit to Get Source Case Laws: GST 2019 (7) TMI 240 Levy of IGST on Ocean Freight - Vires of Notification No. 8/2017-Integrated Tax [Rate] dated 28th June 2017 and Entry 10 of the Notification No. 10/2017- Integrated Tax [Rate] also dated 28th June 2017 - HELD THAT:- The attention of the court is also invited to the order dated 12.12.2018 passed by this court in the said writ petition, whereby the court has granted interim relief directing that no coercive steps shall be taken against the petitioner pursuant to the impugned notification in the meanwhile. Issue Notice returnable on 17th July, 2019. 2019 (7) TMI 239 Extension of the time period for furnishing bank guarantee - case of applicant is that the first three installments have already been paid and that the fourth installment could not be paid because the bank account of the applicant has been attached by the respondent authorities as the applicant could not furnish the bank guarantee within the period specified by this court - HELD THAT:- When the amount due and payable is ₹ 55,00,000/and three equal monthly installments have already been paid and the fourth installment could not be paid on account of the bank account of the applicant being attached, the court is of the view that the request of the applicant for extending the period for furnishing the bank guarantee is a reasonable one, more so, considering the fact that substantial amount out of the outstanding amount has already been paid. However, at the same time, it would also be necessary to protect the interest of the Revenue. Therefore, in case of default on the part of the applicant to pay any further installment, it would be necessary to permit the respondents to resort to the provisions of section 83 of the Central Goods and Services Tax Act, 2017 for attaching the bank accounts of the applicant. Application allowed. 2019 (7) TMI 238 Seizure of vehicle alongwith the goods - detention on the ground that the goods are undervalued - interpretation of Sections 129 and 130 of the GST Act - HELD THAT:- There are many larger issues involved in this petition, more particularly, with regard to the interpretation of Sections 129 and 130 of the GST Act. Many petitions have been admitted and are pending for consideration in this regard. We propose to pass an order directing the respondent authorities to release the goods on the writ-applicant depositing the amount of ₹ 6,07,600 i.e. ₹ 3,03,800 towards the tax and ₹ 3,03,800 towards the penalty - The vehicle as well as the goods, i.e. betel nuts, detained/seized under purported exercise of powers under Sections 129 and 130 of the GST Act shall be released immediately upon the writ-applicant depositing the amount with the concerned department. Post this matter for further hearing on 24th July 2019. 2019 (7) TMI 237 Profiteering - supply of construction services related to purchase of Flat - benefit of reduction in the rate of tax not passed on by passing on the additional benefit of Input Tax Credit after implementation of CST - contravention of Section 171 of CGST Act - HELD THAT:- The above project had been started after coming in to force of the GST w.e.f. 01 07.2017. It is also clear that the above Applicant had deposited the security amount for allotment of the flat on 18.08.2017 and was given the allotment on 20 11.2017 on the basis of the draw of lots held on 16.11.2017. The agreement between the above Applicant and the Respondent was executed on 13.12.2017. Therefore, it is apparent that the Applicant No. 1 had applied for allotment and was allotted the above flat after coming in to force of the GST w.e.f. 01.07.2017. Since the above project was not under execution in the pre-GST period i.e. before 01.07.2017 therefore, no comparison can be made between the ITC which was available to the Respondent before 01.07 2017 and after 01.07.2017 to determine whether the Respondent had benefitted from additional availability of ITC or not. There has been no additional benefit of ITC to the Respondent and hence he was not required to pass on its benefit to the above Applicant by reducing the price of the flat. The Applicant No. 1 could have availed the above benefit only if the above project was under execution before coming in to force of the GST as the Respondent would have been eligible to avail ITC on the purchase of goods and services after 01.07.2017 on which he was not entitled to do so before the above date. Since there was no basis for comparison of ITC available before and after 01.07.2017, the Respondent was not required to recalibrate the price of the flat due to additional benefit of ITC. It is clear from Section 171 (1) of the CGST Act, 2017, that there should either be reduction in the rate of tax or the benefit of ITC which is required to be passed on to the recipients by commensurate reduction in the price - Since there has been no reduction in the rate of tax or benefit of additional ITC to the Respondent the provisions of the above Section are not attracted in the present case and the allegation of profiteering is not established against the Respondent. Application dismissed. Income Tax 2019 (7) TMI 236 Disallowance u/s 14A r.w. Rule 8D - interest expenses and administrative expenses - net interest earned during year - assessee claimed that these are old investments and no expenditure incurred - HELD THAT:- A perusal of the order of the ld.CIT(A) would reveal that the assessee has net interest income. It has shown interest income of ₹ 58,38,817/-therefore interest is not required to be computed for making disallowance. For buttressing our view point, we rely upon judgment of Hon ble Gujarat High Court in the case of CIT Vs. Nirma Capital Credit P.Ltd., 8 [ 2017 (9) TMI 485 - GUJARAT HIGH COURT] . The ld.AR during the course of hearing also pointed out that if the calculation is being made on the basis of 0.5% of average value of the investment, which has yielded dividend, then total expenditure could be worked at ₹ 548/- only. Therefore, considering the details submitted by the assessee as well as the fact that on similar investment no expenditure was disallowed in earlier years or in the subsequent year, we are of the view that no disallowance is required u/s 14A in the present year also. This ground of appeal is allowed. 2019 (7) TMI 235 Stay of demand - present demand is to the tune of ₹ 9,33,16,434 - in last interim order court has held that petitioner is at liberty to deposit appropriate amount in cash by way of security and attachment in respect of one property was lifted as well as three accounts which were also under attachment were released - HELD THAT:- All this was done with the idea that the petitioner shall pay reasonable amount. It however, appears that no concrete steps have been taken by the petitioner. As a last opportunity, we grant to the petitioner time of six weeks within which he shall deposit a sum of ₹ 5 crores with Principal Commissioner, Income Tax, Chennai, failing which this petition may be dismissed. 2019 (7) TMI 234 Deduction u/s 80IC - claim admissible for five years - whether assessee can start claiming the exemption at the same rate of 100% beyond the period of five years on the ground that the assessee has now carried out substantial expansion in its manufacturing unit? - HELD THAT:- As decided in M/S. AARHAM SOFTRONICS [ 2019 (2) TMI 1285 - SUPREME COURT] as defined in clause (ix) of sub-section (8) of Section 80-IC by such an undertaking or enterprise, within the aforesaid period of 10 years, the said previous year in which the substantial expansion is undertaken would become 'initial assessment year', and from that assessment year the assessee shall been entitled to 100% deductions of the profits and gains. Such deduction, however, would be for a total period of 10 years, as provided in sub-section (6). For example, if the expansion is carried out immediately, on the completion of first five years, the assessee would be entitled to 100% deduction again for the next five years. On the other hand, if substantial expansion is undertaken, say, in 8th year by an assessee such an assessee would be entitled to 100% deduction for the first five years, deduction @ 25% of the profits and gains for the next two years and @ 100% again from 8th year as this year becomes 'initial assessment year' once again. However, this 100% deduction would be for remaining three years, i.e., 8th, 9th and 10th assessment years. - Decided against the Revenue Reopening of assessment u/s 147 - HELD THAT:- Once the second question of law is answered against the Revenue, it would not be a case for reopening of assessment under Section 147. Therefore, the first question of law is also answered against the Revenue 2019 (7) TMI 233 Dividend distribution Tax (DDT) - buy back its own shares u/s 77A of the Companies Act - distribution of accumulated profit or not - impact of pendency of application filed under 245Q before Authority for Advance Rulings - scope of amendment in Section 115QA w.e.f. 01.06.2016 - assessee contended that it has bought back its own shares under the Scheme of Arrangement and Compromise u/ss 391 to 393 of the Companies Act prior to the amendment. Section 115O of the Act mandates issuance of SCN, enquiry before passing a final order - HELD THAT:- From a plain reading of the provisions from 115O to 115QA, it is seen that Section 115 O is a charging section on its own. These Sections are self contained codes in themselves and they do not demand for issuing any show-cause notice and then passing any order. - It is to be noted that unless the law requires, the AO need not issue notice before making a demand u/s 115 O. The parliament in its wisdom brought amendments to the Finance Act and inserted Section 115 O to 115 Q with effect from 01.06.1997 (Special Provisions) to achieve an object. If any other view is taken, then the Special Provisions under Chapter XIV would become redundant and it would be opening a pandoras box. Breach of principles of natural justice - HELD THAT:- Admittedly, a notice dated 21.11.2017 was issued to the petitioner calling for details and meetings were convened, in which, indisputably, the officials of the petitioner Company participated and a detailed note explaining the various provisions of the Act have been given to them. It is pertinent to note that the object and purpose of issuing show cause notice is to put on notice to the proposed action to be initiated by the Officials and nothing else. But, a curious stand is taken by the petitioner that the letter dated 21.11.2017 cannot be construed as a showcause notice and the informal discussion cannot be substituted for a proper show-cause notice with a chance of reply and an opportunity of hearing, hence, I find no substance in the said submission. AO is prohibited from issuing the impugned order in the light of the bar prescribed in Section 245 RR - petitioner approached the Authority for Advance Rulings only on 20.03.2018 - notice issued on 21.11.2017 - HELD THAT:- Section 245R makes it clear that if the enquiry is already pending before the AO, the Authority for Advance Rulings has no jurisdiction to entertain the application. Hence, I find no force in the argument of the learned Senior Counsel for the petitioner that the impugned order does not stand in view of the bar u/s 245 RR. Writ Petition is maintainable - HELD THAT:- It is well settled that the assessee has an appeal remedy u/s 246. In this case, an unsuccessful attempt has been made by the petitioner to bypass the appeal remedy, but, I find no valid ground to entertain the Writ Petition. In that view, the Writ Petition is dismissed as not maintainable at this stage. The Writ Petition fails and the same is dismissed. However, liberty is given to the petitioner to prefer an appeal within a period of four weeks from today. If such an appeal is filed within the stipulated time, the Appellate Authority shall dispose of the same on merits. 2019 (7) TMI 232 Allowability of consultancy fees - financial advisory services for restructuring of its loan - capital expenditure OR revenue expenditure - Assessee was able to reduce the interest rate on its loan for the remaining period of the relevant loan agreement - HELD THAT:- In the present case, the Tribunal has come to a conclusion, as a matter of fact, that the expenditure incurred by the Assessee in payment of fees to ICICI Ltd. had nothing to do with the expansion of the capital base of the company and that the Assessee had clearly made out a case that it was for restructuring of its loan and was by way of a revenue expenditure - no question of law arises - the appeal of revenue is dismissed. 2019 (7) TMI 231 Assessment u/s 153C - whether of notices were barred by the limitation? - Effect of amendment in Section 153C w.e.f .1st June, 2015 - can notice u/s 153C under amended provision be issued in relation to searches carried out till 31st May 2015 - HELD THAT:- With regard to the first question, the coordinate bench of this court in ANILKUMAR GOPIKISHAN AGRAWAL VERSUS ACIT, [ 2019 (6) TMI 746 - GUJARAT HIGH COURT] took the view that the writ-applications were maintainable. With regard to the second question regarding impact of amendment, the Court took the view that the Legislature has specifically made the amended provisions of Section 153C applicable with prospective effect from 01.06.2015. The Court held that if such amended provisions are not made applicable to the searches carried out prior to 01.06.2015, they would affect the substantive rights of the persons who are brought within the ambit of Section 153C by virtue of such amendment. So far as the third question is concerned with regard to the limitation, the Court took the view that when the statute itself provides for an alternative period of limitation, merely because the period of limitation is provided under the first part has elapsed; it cannot be said that the notices were barred by the limitation on such ground. It had been stated that in terms of clause (b) of subsection (1) of section 153A, the six years assessment years would be the six assessment years preceding assessment year relating to the previous year in which search is conducted or requisition made and in case any notices u/s 153C which have been issued for assessment years beyond the six assessment years referred to hereinabove, such notices would be beyond jurisdiction as the same do not fall within the six assessment years as contemplated u/s 153A. In view of the above, the petition is allowed. The impugned notice is hereby quashed and set aside. Consequently, if any Assessment Order has been passed u/s 153C , the same is also quashed and set aside. 2019 (7) TMI 230 Low tax effect - Revision u/s 263 - undisclosed investment in shops - undisclosed income by way of receipt of cash donations - earlier also this appeal was dismissed on the ground of low tax effect and restored pursuant to MA filed by revenue - HELD THAT:- Mr. Bhatt, the learned senior standing counsel appearing for the revenue clarifies that Circular No.21/2015 dated 10th December, 2015, at the relevant point of time, was applicable only to the fresh appeals. In such circumstances, the revenue had to prefer a miscellaneous civil application for restoring this appeal to its original file. Mr. Bhatt further clarifies that later, the revenue issued a fresh circular No. 3/2018 dated 11.07.20148 clarifying that it would apply even to the pending appeals. This appeal would be covered by the above referred circular. In such circumstances, Mr. Bhatt, the learned senior counsel prays that the revenue would not be pressing this appeal. The appeal stands disposed of accordingly. 2019 (7) TMI 229 Stay of demand - direction to pay 20% demand - disposal of appeal by CIT(A) - vide interim order court has extended the time limit of deposit by one month - HELD THAT:- This Court as an exceptional case directs the 1st respondent to dispose of the appeals within three months from the date of receipt of copy of this judgment. The petitioners, if complies with the condition of depositing 10% within four weeks from today, the petitioners are entitled to the stay of the assessment orders under challenge in the subject appeals till its disposal thereof. The petitioners, if fail, to comply with the condition now stipulated by this court, it is made clear that the petitioners are not entitled for the benefit of the stay orders. The authorities can proceed to recover the amount in accordance with law. 2019 (7) TMI 228 Penalty u/s 271(1)(c) - defective notice - non-striking of the irrelevant column - from the notice it was not clear whether notice is for concealment of income or furnished inaccurate particulars - HELD THAT:- Respectfully following the decision of the Hon'ble Supreme Court in the case of SSA s Emerald Meadows [ 2016 (8) TMI 1145 - SC ORDER] and also the decision of Hon'ble High Court of Telangana A.P. in the case of Smt. Baisetty Revathi [ 2017 (7) TMI 776 - ANDHRA PRADESH HIGH COURT] and also the decision of the coordinate bench of the tribunal in the case of Konchada Sreeram [ 2017 (11) TMI 1164 - ITAT VISAKHAPATNAM] , I hold that the notice issued u/sec. 274 read with section 271 is invalid and, therefore penalty order passed by the AO is hereby cancelled. 2019 (7) TMI 227 Addition made on account of technical knowhow fees - nature of expenditure - revenue expenditure and not capital expenditure - HELD THAT:- As decided in assessee's own case [ 2019 (6) TMI 655 - ITAT CHANDIGARH] in view of the findings of the CIT(A) that identical issue stands decided in favour of the assessee in assessment year 2009-10 [ 2013 (10) TMI 924 - ITAT CHANDIGARH] by the I.T.A.T., which has been admitted to by the Revenue also and no distinguishing facts having been brought to our notice by the Ld. DR, the Ld.CIT(A), we hold, has rightly allowed the assessee s appeal following the order of the I.T.A.T. in assessee s own case for assessment year 2009-10. We therefore find no reason to interfere in the order of the Ld.CIT(A) holding the technical knowhow expenses as revenue in nature. Addition on account of sales tax subsidy - HELD THAT:- As decided in assessee's own case [ 2019 (6) TMI 655 - ITAT CHANDIGARH] since the issue of sales tax subsidy received by the assessee by virtue of scheme of Punjab Government has already been decided by the I.T.A.T. in the case of the assessee itself in the preceding years, holding the same to be capital in nature and with no distinguishing facts having been brought to our notice by the DR, we see no reason to interfere in the order of the Ld.CIT(A) allowing the assessee s appeal following with order of the I.T.A.T. MAT computation - disallowance of claim of the assessee for deduction of the sales tax subsidy from the book profit under section 115JB - HELD THAT:- As decided in assessee's own case [ 2019 (6) TMI 655 - ITAT CHANDIGARH] we find is identical to that in H.M Steels [ 2018 (11) TMI 1628 - ITAT CHANDIGARH] ,with the Sales tax subsidy having been held to be capital in nature. In view of the same ,the issue we hold is squarely covered by the decision of the ITAT in the case of H.M Steels, following which we hold that the sales tax subsidy is to be reduced from the Book Profits for the purposes of paying tax u/s 115JB. - Assessee's appeal allowed. 2019 (7) TMI 226 Addition regarding Cash deposit in Bank Account - based on AIR Information - receipts of unaccounted sales as well as cash in hand - assessee contended that either profit rate of 8% should be adopted on the unaccounted sales or the peak credit should be considered - HELD THAT:- A perusal of the bank statement shows that only a part of the deposits and withdrawals have been shown in the regular accounts and the assessee has not disclosed the entire deposits and withdrawals. When there is no evidence with the Revenue that the withdrawals made by the assessee systematically from the bank account, which are not shown to the Revenue, have been utilized for some other purpose other than for the unaccounted business of the assessee, therefore, we find merit in the argument of the Ld. Counsel for the assessee that the assessee should be given the benefit of peak credit theory and only the peak credit has to be sustained. Since, the assessee has calculated such peak credit at ₹ 2,38,737/-, therefore, we set aside the order of the Ld. CIT(A) and direct the AO to sustain only the peak credit of ₹ 2,38,737/- subject to his verification. Deduction u/s 54F - on enquiry the Inspector reported that the plot is lying vacant and there is no construction work carried over the said plot - HELD THAT:- We find neither the assessee has constructed the house property during the year as claimed nor deposited the long term capital gain of above amount in the specified capital gain accounts scheme. Therefore, when the assessee has not fulfilled the conditions laid down in section 54F the argument of the Ld. Counsel for the assessee that the same can be taxed only in the AY 2015-16 i.e. after the expiry of 3 years is not acceptable as not being in accordance with law. Therefore, the order of the CIT(A) on this issue is upheld and the ground raised by the assessee are dismissed. Disallowance of depreciation - depreciation on machines sold - HELD THAT:- It is the submission of the Ld. Counsel for the assessee that only an amount of ₹ 15,383/- has been claimed as excess depreciation and not ₹ 44,721/- as held by the AO and upheld by the CIT(A) and, therefore, this matter may be set aside to the file of the AO. In view of the above submission by the Ld. Counsel for the assessee and after considering the argument of the Ld. DR, we deem it proper to restore this issue to the file of the AO with a direction to verify the records and restrict the depreciation to the actual amount of excess claim. Ad-hoc addition @ 1/5th out of certain expenses - probable personal use - HELD THAT:- In our opinion, the disallowance at 20% of the expenses on ad-hoc basis appears to be on the higher side. We, therefore, restrict the disallowance to 10% of the expenses i.e. ₹ 40,489/- as against ₹ 80,979/- upheld by the CIT(A). The ground raised by the assessee is partly allowed. 2019 (7) TMI 225 Rectification of mistake u/s. 254(2) - Levy of penalty u/s 271(1)(c) - attempt to infuse money into account through fraudulent penny stocks @ 10%, which was rightly brought to tax @ 30% by the AO - HELD THAT:- We find that the ITAT has deleted the penalty by placing reliance upon the catena of case laws. It has not been submitted by the Revenue in the aforesaid submission as to how those case laws are not applicable. The Tribunal in its order had elaborately dealt with the reasoning for deleting the penalty. Furthermore, case laws referred by ITAT dealt with various issue and on the touchstone of which penalty levied was deleted. Now, by way of this Miscellaneous Application Revenue seeks review of the order of the Tribunal, which is not permissible in the garb of rectification of mistake u/s. 254(2). Accordingly, this Miscellaneous Application filed by the Revenue stands dismissed. 2019 (7) TMI 224 Penalty u/s 271 (1) (c) - survey action u/s 133A - assessee agreed to offer revenue @ 5% on the incremental construction work in progress on year on year basis subject to non levy penalty on such voluntary declaration - additional ground regarding invalid notice - assessee has not raised any bill as construction was not completed up to 30% - non following of revised accounting standard (AS-7) - HELD THAT:- The contents of the addendum to the contract supports the contention of the assessee that the assessee was entitled to raise the initial bill only after completion of 30% of the work awarded. In the present case since the assessee has explained the circumstances under which the addition in question has been made and further established that the explanation is bonafide and it has disclosed all the facts material to the computation of its total income, the Ld. CIT(A) has wrongly confirmed the addition made by the AO. In our considered opinion, this is not a case of concealment of particulars of income by the assessee. We do not find any active concealment of particulars of income by the assessee in the present case which is a precondition for imposing penalty under the said section. 2019 (7) TMI 223 Disallowing hoarding construction charges - capital expenditure OR revenue expenditure - construction of hoardings per sq. ft. is as high as ₹ 200/ - huge expenses were made for construction of hoarding, the same should be giving usefulness / utility for more than one financial year - income from display charges - on enquiry Inspector's report the hoarding at 113, Dilkhusha Street near Park Circus was approximately of 1200 sq. ft, huge structure, made with angles of steel and the hoarding had been there for almost 2 years similarly the other hoardings HELD THAT:- The hoardings are temporary structures and are made with angles of steel and iron rods to affix them to the ground since these are vulnerable to rain, storm, theft and other damages. As such, affixation of the same using steel angles and iron rods was a necessity else the assessee would have not received any advertising orders. To receive advertising orders, these hoardings were required to be maintained by the assessee in a good quality condition. Further, in order to avoid corrosion of the structure and other adverse weathering effects, replacement of parts and other incidental expenses is regularly required to be done. It is also relevant to note that such expenditure is a recurring expenditure which is required to be incurred by the assessee regularly and the same therefore cannot be said to have given any enduring benefit to the assessee in capital field. The Inspector has based his findings in the impugned report by watching a hoarding after a time gap of three years. The said hoardings had underwent changes in this long time span of three years. Repair works and replacement of parts had taken place in the last few years as per the demand of the advertising business. As such, the structure existing on the date the Inspector visited the site can in no circumstances be compared with the structure which existing in the relevant AY, being AY 2012-13. We note that the assessee has been following this practice of claiming the hoarding expenses as revenue expenses in all the earlier years also and the same was not disturbed by the learned AO in any of the preceding years. There is no change in the accounting policies of the assessee in the current year vis a vis the earlier years, hence consistency should be maintained by the assessing officer. Apart from this, on identical facts, Coordinate Bench of Mumbai ITAT in the case of M/s Empress Advertising [ 2014 (7) TMI 1191 - ITAT MUMBAI] has held such expenditure is a recurring expenditure which is required to be incurred by the assessee regularly and the same therefore cannot be said to have given any enduring benefit to the assessee in capital field. Applying the ratio of the above noted judicial precedents, to the facts of the assessee`s case, it is abundantly clear that hoarding expenses incurred by the assessee are revenue in nature and are not capital in nature. Disallowance u/s 40A(2)(b) - salary to the wife of assessee - HELD THAT:- We note that Nidhi Kejriwal, being a BSC. Graduate, has benefitted the company in a number of ways and hence, the salary of ₹ 16,000/- per month was commensurate with the type of services provided by her to the assessee firm and was not unreasonable. The AO made addition purely on surmises and conjectures without bringing comparable persons having same education and experience on record to judge fair market value of Nidhi Kejriwal services. No finding was recorded by the AO that the sum of ₹ 50,000/- is unreasonable u/s 40A(2)(b). - we delete the addition 2019 (7) TMI 222 Penalty U/s 271AAB - search and seizure operation U/s 132 - penalty imposed based on assessee admitted Undisclosed Income in its statement u/s 132(4) but could not furnish his return of income on or before the specified date - diary found in search in which certain advances are mentioned - from notice issued U/s 274 r.w.s. 271AAB it was not clear as to under which clause the case of assessee Company would fall - HELD THAT:- Every additional income declared in the return filed is not per se Undisclosed Income . What has been found during the course of search is a red diary, wherein there are certain notings relating to cash advances given to various persons totaling ₹ 4 crores. Besides the said document, there were no other incriminating document/material was found during the course of search. As per the definition of undisclosed income u/s 271AAB, the said cash advance cannot be stated to be income which is represented by any money, bullion, jewellery or other valuable article or thing. In the definition of undisclosed income, it talks about income by way of any entry in the books of account or other documents or transactions found in the course of a search under section 132 . The cash advance cannot be deemed as undisclosed Income in the context of section 271AAB. For this proposition, reliance is placed on the judgment of Silver Art Palace vs DCIT [ 2019 (4) TMI 634 - ITAT JAIPUR] where Hon ble ITAT Jaipur Bench held that such cash advances cannot be deemed as Undisclosed Income for the purpose of section 271AAB. In view of the above discussion and respectfully following the judicial pronouncements (supra), we do not find any merit for imposition of penalty in respect of declared income which is not coming in the purview of undisclosed income as defined under clause (c) to explanation to Section 271AAB . It is pertinent to mention here that no contrary decision was brought to our notice by the ld DR so as to persuade us to deviate from the conclusion drawn in the above judicial pronouncements as referred and relied by us. - both the appeals of the assessees are allowed 2019 (7) TMI 221 Characterization of income - Compensation received for foregoing the rights in the agreement to purchase property is taxable - revenue or capital receipt - HELD THAT:- Once the compensation is held to be is only on account of foregoing right to sue, which is a right in personam the same cannot be brought to tax. Furthermore, in the case of Oberoi Hotels (P.) Ltd. vs. CIT [ 1999 (3) TMI 2 - SUPREME COURT] held that the amount received by the assessee for giving up its right to purchase or for getting it on lease is a capital receipt. Further, clause (ix) to sub s. (2) of s. 56 was inserted w.e.f assessment year 2015-16 providing to assets to tax the amount any sum of money received as an advance otherwise in the course of negotiation for transfer of capital asset if sum is forfeited and does not result in transfer of capital asset only w.e.f 01.04.2015. The amount received in giving up the right for specific performance was held to be capital receipt to the same effect in the decision of CIT vs. Smt. Laxmidevi Ratani [ 2005 (2) TMI 105 - MADHYA PRADESH HIGH COURT] . In the light of above legal position, the amount of compensation received by the assessee cannot held to be a revenue receipt, but is a capital receipt and not liable to tax and it cannot be brought to tax under capital gain for the reason that it is not a capital asset. Thus, we reverse the orders of lower authorities and allow the appeal filed by the assessee. Customs 2019 (7) TMI 220 Duty Drawback - manufacturer and exporter of leather footwear - It is petitioner's case that writ petitioner is entitled to drawback as notified under Customs and Central Excise Duties Drawback Rules, 1995 till 30.06.2018 and under the Customs and Central Excise Duties Drawback Rules 2017 on and from 01.07.2017 - HELD THAT:- Impugned show-cause notice being SCN dated 24.01.2019 is not quashed, but is kept in abeyance for a period of eight weeks from the date of receipt of a copy of this order. Within the said period of eight weeks, the third respondent Board shall issue a clarification particularly with reference to the issue raised by the writ petitioner pertaining to applicability of said Circular i.e., Circular No.83/2003 in the post GST regime i.e., post 01.07.2017. Depending on the clarification, the impugned SCN will either get revived and carried to its logical end or dropped obviously post eight weeks. Petition disposed off. Insolvency & Bankruptcy 2019 (7) TMI 219 Admissibility of petition - Initiation of Corporate Insolvency Resolution Process - existence of Debt - HELD THAT:- Applicant is an Operational Creditor within the meaning of sub-section (5) of Section 20 of the Code. From the aforesaid material on record, petitioner is able to establish that there exists debt as well as occurrence of default. The Application filed by the Applicant is complete in all respects. Petition admitted - moratorium declared. 2019 (7) TMI 218 Liquidation order - Section 33 of the Insolvency Bankruptcy Code, 2016 (I B Code) - rejection of resolution plan - HELD THAT:- In view of the order of liquidation, the Liquidator is now required to act in terms of the decision of this Appellate Tribunal in Y. SHIVRAM PRASAD AND ASSET RECONSTRUCTION COMPANY (INDIA) LTD. VERSUS S. DHANAPAL ORS. AND SERVALAKSHMI PAPER LTD. ORS [ 2019 (5) TMI 386 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI] where it was held that As the liquidation so taken up under the I B Code , the arrangement of scheme should be in consonance with the statement and object of the I B Code . Meaning thereby, the scheme must ensure maximisation of the assets of the Corporate Debtor and balance the stakeholders such as, the Financial Creditors , Operational Creditors , Secured Creditors and Unsecured Creditors without any discrimination. Appeal disposed off. 2019 (7) TMI 217 Permission to withdraw the Corporate Insolvency Resolution Process (CIRP) - Corporate Debtor - HELD THAT:- Regulation 30(A) provides that an application for withdrawal under Section 12A shall be submitted to the interim resolution professional or the resolution professional, as the case may be, in Form FA of the Schedule before the issue of invitation for expression of interest under regulation 36A . The regulation further provides that if the application is approved by the CoC with 90% vote share, the Resolution Professional shall submit the application under sub-regulation (1) to the Adjudicating Authority on behalf of the applicant, within three days of such approval. Further Regulation provides that adjudicating authority may, by order, approve the application submitted under sub-regulation (4). The use of the word may in Sec. 12A of the Code indicates that, if an application is filed under Section 12A, and CoC approves it with 90 per cent voting share, then the Adjudicating Authority may allow the withdrawal application, in such manner as specified. Section 12A of the Code stipulates that the Adjudicating Authority has the discretion to accept or reject the application, filed under Section 12A, provided that application is made by the applicant with the approval of 90% vote share of the CoC - Regulation 30A of CIRP Regulations, 2016 provides the procedure by which application under Section 12A can be filed. Regulation 30A provides that application under Section 12A should be filed in Form FA before issuance of an invitation for expression of interest. Since section 29A of the Code specifically prohibits a wilful defaulter to submit a Resolution Plan. In this case, admittedly promoters of the Corporate Debtor are a wilful defaulter, and therefore. they are not eligible to submit a Resolution Plan as per section 29A. The resolution for withdrawal of CIRP did not obtain the required percentage of voting by the members of CoC, i.e. 90% at the first instance. Subsequently, a CoC meeting was conducted, and a resolution was voted upon for reconsideration of the withdrawal. The RP/CoC has not quoted the exact provision that empowers them to again put for the voting of the resolution which was earlier defeated. 2019 (7) TMI 216 Admissibility of petition - Initiation of Corporate Insolvency Resolution process against Corporate Debtor - default in making payment with interest - Section 9 of Insolvency Bankruptcy Code read with Rule 6 of Insolvency Bankruptcy (Application to Adjudicating Authority) Rules, 2016 - HELD THAT:- This Bench having been satisfied with the Application filed by the Operational Creditor which is in compliance of provisions of section 8 9 of the Insolvency and Bankruptcy Code admits this Application declaring moratorium - Petition admitted. Service Tax 2019 (7) TMI 215 Refund of service tax paid - construction of residential house - more than 12 units or not - refund claimed as per the exemption provided under S.No.14 of N/N. 25/2012-ST dated 20.06.2012 - refund claim denied on the ground that exemption notification is not applicable in the present case, as the present project consisting of more than 12 Villas, is not a single residential unit - HELD THAT:- In the present case, there is a separate agreement entered between the appellant and the contractor for construction of the individual house for which separate approval has been sanctioned. Further the definition of residential complex is not applicable in the present case because all the conditions which are required to be fulfilled for a complex to be residential complex are not fulfilled in the present case - the ground for rejection is that there are common facilities like park and roads but in view of the Relinquishment Deed produced on record, I find that these common facilities like parks and roads have been relinquished to the Government and hence the same is not the common properties of the owner. It is rather a public property which cannot be considered as common facilities. Appeal allowed - decided in favor of appellant. 2019 (7) TMI 214 CENVAT Credit - input services - Renting of Immovable Property Service - HELD THAT:- For the purpose of establishing the correlation of the service on which the cenvat credit was availed and the output service provided, the present case remanded back to the original authority to pass a fresh order after considering the documents which may be produced by the appellant in support of their case - appeal allowed by way of remand. 2019 (7) TMI 213 Utilization of CENVAT Credit - post amendment period - utilization of credit on the services supplied to them during construction of mall for discharging their service tax liability after the constructed mall was rented out, on the maintenance repair services - HELD THAT:- The issue is no longer res integra in view of the decision of Hon‟ble Andhra Pradesh High Court in the case of Sai Sahmita Storages (P) Ltd. [ 2011 (2) TMI 400 - ANDHRA PRADESH HIGH COURT ] which was subsequently followed by the various other decisions - In all these cases, the issue was identical and it was held by various Tribunals/High Court that in such a situation, the appellant would be entitled for the benefit of Cenvat credit prior to amendment for post amendment period also. The availment of the Cenvat Credit for being utilised for the payment of service tax on provision of output services of Renting of Immovable Property is allowed - appeal allowed - decided in favor of appellant. 2019 (7) TMI 212 Works Contract Service - Composition Scheme - obtaining of permission from the jurisdictional Officer for discharging the service tax liability under the composition scheme - mandatory requirement or not - HELD THAT:- The said issue is settled in the case of REAL VALUE PROMOTERS PVT. LTD., CEEBROS PROPERTY DEVELOPMENT, PRIME DEVELOPERS VERSUS COMMISSIONER OF GST CENTRAL EXCISE, CHENNAI [ 2018 (9) TMI 1149 - CESTAT CHENNAI] where it was held that The services provided by the appellant in respect of the projects executed by them for the period prior to 1.6.2007 being in the nature of composite works contract cannot be brought within the fold of commercial or industrial construction service or construction of complex service - For the period after 1.6.2007, service tax liability under category of commercial or industrial construction service‟ under Section 65(105)(zzzh) ibid, Construction of Complex Service‟ under Section 65(105)(zzzq) will continue to be attracted only if the activities are in the nature of services‟ simpliciter. Appeal dismissed - decided against appellant. 2019 (7) TMI 211 Refund of service tax paid - input services - Real Estate Agent Service - Management Consultant Service - HELD THAT:- In the appellant s own case for the previous period in the case of COMMISSIONER OF CENTRAL EXCISE VERSUS M/S. MANGALORE SEZ LTD. [2016 (11) TMI 1103 - CESTAT BANGALORE] , Commissioner (Appeals) has allowed the refund on the ground that approval was obtained subsequently from the Development Commissioner. The impugned order denying the refund of ₹ 1,10,250/- is not sustainable in law - appeal allowed - decided in favor of appellant. 2019 (7) TMI 210 Recovery of the service tax - Consulting Engineer services - period 1997-98 to 2000-2001 - whether the Appellant during the relevant period i.e. 1997-98 to 2000-01, rendered the services which fall under the category of consulting engineer service as was in force at the relevant point of time? - HELD THAT:- Inasmuch the relevant service agreements with respective customers/clients have not been produced by the Appellant before the Adjudicating authority. Therefore, it is prudent to remand the matter to the Adjudicating authority to analyse the agreements that are now produced before this forum and further copies of the agreements that would be produced during de-novo proceedings. Appeal is allowed by way of remand to the Adjudicating authority. 2019 (7) TMI 209 Recovery of Service Tax - Business Auxiliary Service - GTA Services - reverse charge mechanism - HELD THAT:- A perusal of the show-cause notice shows that it is the allegation in the show-cause notice that the assessee received goods transport services as a consignee/consignor towards transportation of goods by road by different goods transport agencies and hence the demand. This demand was made based on the annual reports for the year 2004-05, 2005-06, 2006-07, and 2007-08 and statement dated 18.02.2009, ledger copies and debit notes in respect of export commissions and goods transports as well as based on assessment letters along with consignment notes. Appellant now pleads in the grounds of appeal that they have not availed the services of any goods transport agency at all. However, this assertion is not substantiated by any evidence whatsoever in the appeal book. There is no merits in the appeal - appeal dismissed. 2019 (7) TMI 208 Short payment of service tax - the adjudicating authority rejected the C.A. certificate on the ground that the supporting documents like, ledger, invoice, bills etc. have not been produced - HELD THAT:- Since the appellant had already earlier submitted the detail of profit and loss account, ledge, invoices, bills etc., they had placed the C.A. certificate in support of their claim for reconciliation of the figures between ST-3 returns and the balance-sheet. The authorities below rejected the C.A. certificate on the ground that the supporting documents were not enclosed along with the certificate. There is no justification in the findings of the authorities below inasmuch as all the documents have been submitted by the appellant, the basis on which show-cause notice was issued to the appellant which is evident from the show-cause notice itself - rejection of the C.A. certificate for want of supporting documents, cannot be sustained. Since the appellant is able to reconcile the differential figures between ST-3 returns and the balance-sheet supported by the C.A. certificate - Appeal allowed - decided in favor of appellant. 2019 (7) TMI 207 Business Auxiliary Services - commission received from M/s. Moneygram for the activity of transfer of money to a person located in India by the appellantassessee on behalf of M/s. Moneygram - HELD THAT:- The said issue has been examined by the larger bench of this Tribunal in the case of M/S PAUL MERCHANTS LIMITED OTHERS VERSUS CCE, CHANDIGARH [ 2012 (12) TMI 424 - CESTAT, DELHI (LB)] , wherein it has been held that the services provided by agent and sub-agents to M/s.Western Union Network Limited are export of services and not liable to service tax - Similar issue is in the case in hand, the appellant-assessee has provided servic es to M/s. Moneygram as the appellant-assessee is transferring the money on the instructions of M/s. Moneygram to their clients in India. Therefore, the said activity falls under export of services, no service tax is payable by the appellant-assessee. Business Auxiliary Service - commission received for arranging air tickets for their customers - HELD THAT:- The said demand cannot be confirmed against the appellant-assessee in the light of the decision of this Tribunal in the case of TRADE WINGS LTD. VERSUS COMMISSIONER OF C. EX. SERVICE TAX, JAIPUR-I [ 2017 (9) TMI 257 - CESTAT NEW DELHI] where it was held that The travelling public is getting only ticket with no identity linking the same to another travel agent. In such situation, it could not be said that the appellant is promoting the business of another travel agent, in their capacity as sub-agent. No such fact has been established in the impugned order by the lower authority - for the said amount of commission received by the appellant-assessee, no service tax is payable. Fee charged for filing passport applications - HELD THAT:- The value of taxable services were less than the exemption limit prescribed under Notification No.6/2005-ST dt.1.3.2005 as their total amount of taxable service falls within the threshold limit, therefore, no service tax is payable by the appellant-assessee - the appellant-assessee is not liable to pay service tax. Appeal allowed - decided in favor of appellant. 2019 (7) TMI 206 Demand of service tax on Advance - in terms of Section 67(3) of the Finance Act, 1994 - HELD THAT:- The appeal is admitted on substantial questions of law. Central Excise 2019 (7) TMI 205 Condonation of delay in filing appeal - power of Appellate Authority to condone delay - Jurisdiction - HELD THAT:- The contentions raised do not fall within the scope of judicial review as explained. At the highest, the contentions raised may have warranted some examination the exercise of appellate jurisdiction, but not in exercise of powers of judicial review. In this case, the petitioner, delayed the institution of appeal and therefore, cannot expect that the this Court converts itself into an appeal court whilst exercising powers of judicial review under Article 226 of the Constitution of India. The contention as raised would require reevaluation and re-appreciation of factual position. Such an exercise cannot be undertaken in the exercise of limited jurisdiction of judicial review. There is absolutely no explanation for inordinate delay in the institution of the petition - petition dismissed. 2019 (7) TMI 204 Condonation of delay of 121 days in filing appeal - time limitation - HELD THAT:- The High Court of Telengana and Andhra Pradesh, has in fact, agreed with the Full Bench decision of Gujarat High Court in Panoli Intermediate (India) Pvt. Ltd. [ 2015 (7) TMI 303 - GUJARAT HIGH COURT ] and observed that a writ petition would lie against an order-in- original, against which, an appeal was filed and dismissed as time-barred or no appeal had been preferred, as it would have been time-barred. I would like to emphasize that the view expressed by the above two full bench decisions of the High Courts holding that writ petition would lie against an order-in-original, even though the appeal was dismissed as time-barred, is not a general rule in all cases and on the other hand, it is a qualified one applicable only under certain circumstances. Petition dismissed as not maintainable. 2019 (7) TMI 203 Condonation of delay in filing appeal - power of Appellate Authority to condone delay - Jurisdiction - HELD THAT:- The contentions raised do not fall within the scope of judicial review as explained. At the highest, the contentions raised may have warranted some examination the exercise of appellate jurisdiction, but not in exercise of powers of judicial review. In this case, the petitioner, delayed the institution of appeal and therefore, cannot expect that the this Court converts itself into an appeal court whilst exercising powers of judicial review under Article 226 of the Constitution of India. The contention as raised would require reevaluation and re-appreciation of factual position. Such an exercise cannot be undertaken in the exercise of limited jurisdiction of judicial review. There is absolutely no explanation for inordinate delay in the institution of the petition - petition dismissed. 2019 (7) TMI 202 CENVAT Credit - input services - tax paid on commissions to Agents who sell the goods and undertake the guarantee of payment - input service invoices issued by their office as ISD prior to 01.03.2006, when the registered address was different. Tax paid on commissions to Agents who sell the goods and undertake the guarantee of payment - HELD THAT:- A plain reading of the scope of commission agent and the Del Credere Agent, it can be inferred that the Del Credere Agent is the one who guarantees payment from the customer s for the sale and in the event of default in such payment, makes good of the same to the principal - In the present case, besides, the activity of sales promotion, the agents have also undertaken to act as a Del Credere Agent. Therefore, merely because of the fact they were also act as Del Credere Agent, the activities/services provided by such agents in promotion of the sale of the product cannot in any manner be diluted - therefore the activities/services rendered by the agents through the agency agreement reproduced above clearly indicate that the services provided by them are in the nature of sales promotion activities in addition to the service as Del Credere Agent, hence, fall within the scope of definition of input service as prescribed under Rule 2(l) of the Cenvat Credit Rules, 2004 - the amount of service tax paid to these commission agents have been rightly held by the Commissioner is in the nature of sales promotion, accordingly, eligible to cenvat credit - credit allowed. Whether the appellant-assessee has correctly availed cenvat credit on the input service invoices issued by their office as ISD prior to 01.03.2006, when the registered address was different? - HELD THAT:- At the relevant time, their Satellite office was a unit included in the list of units for distribution of credit submitted to the department. However, later, due to shifting of the business operations to Satellite office, change of address in the ISD Registration Certificate was requested and allowed from 1st March 2006 - credit should not be denied merely for procedural irregularities - credit allowed. Appeal allowed - decided in favor of appellant. 2019 (7) TMI 201 Refund of CENVAT Credit - Rule 5 of the CENVAT Credit Rules, 2004 - period from October 2016 to December 2016 and January 2017 to March 2017 - Room/Laundry Service - HELD THAT:- The issue has been settled in the case of M/S ONE ADVERTISING COMMUNICATION SERVICES LIMITED VERSUS CST AHMEDABAD. [ 2012 (5) TMI 219 - CESTAT, AHMEDABAD] where credit on similar services allowed - appellant is entitled to refund on the service. Insurance and AMC charges - HELD THAT:- The Bangalore Bench of the Tribunal in the case of COMMISSIONER OF CENTRAL EXCISE CUSTOMS, GUNTUR VERSUS CCL PRODUCTS (INDIA) LTD. [ 2009 (3) TMI 136 - CESTAT, BANGALORE] where it was held that these services have been received or rendered only in relation to the manufacture of final products and the credit was allowed - appellant entitled to credit on such services. APR Certification/CA Services - HELD THAT:- The Bangalore Bench of the Tribunal in the case of COMMR. OF C. EX., VISAKHAPATNAM VERSUS ANDHRA PRADESH PAPER MILLS LTD. [ 2010 (2) TMI 532 - CESTAT, BANGALORE] where it was held that credit is allowed on such services - refund allowed. Legal Expenses - HELD THAT:- The Co-ordinate Bench of the Tribunal in the case of COMMISSIONER OF CENTRAL EXCISE VERSUS M/S. HCL TECHNOLOGIES [ 2014 (11) TMI 663 - ALLAHABAD HIGH COURT] where credit on such services allowed - refund allowed on the service. With regard to the other claim of ₹ 2,00,775/- being not considered for refund, I find that there is no finding given by both the lower authorities and therefore, in the interests of justice, this requires fresh adjudication - matter remanded to the file of the Adjudicating Authority who shall pass a de novo order on this issue after considering all the contentions urged by the appellant. Appeal allowed in part and part matter on remand. 2019 (7) TMI 200 CENVAT Credit - common inputs/input services which are used in the manufacture of dutiable goods and exempted product - recovery of an amount equal to 6% of the clearance value of the exempted goods - HELD THAT:- Hon ble Supreme Court in UNION OF INDIA VERSUS DSCL SUGAR LTD. [ 2015 (10) TMI 566 - SUPREME COURT] , held that Bagasse emerged during the course of manufacture of sugar and molasses as a by-product cannot be subjected to the provisions of Rule 6 of CENVAT Credit Rules, 2004. Appeal allowed - decided in favor of appellant. 2019 (7) TMI 199 CENVAT Credit - Special CVD (SAD) - credit denied merely on the basis of debit in the pass book - HELD THAT:- Commissioner (Appeals) had taken the wrong view while permitting the availment of Cenvat credit on the basis of mere entry in DEPB book - reliance placed in the case of THE COMMISSIONER OF CENTRAL EXCISE, CUSTOMS SERVICE TAX VERSUS M/S. PRECISION PIPES AND PROFILES CO. LTD. [ 2014 (1) TMI 1474 - ALLAHABAD HIGH COURT] - appeal allowed - decided in favor of appellant. 2019 (7) TMI 198 Classification of goods - PVC Suction Pipes, PVC Krishi Pipes, PVC Water Hose Pipe, PVC Water Stop, Rubber Hose and Rubber Sheet - whether classified under chapter 3917 or otherwise? - extended period of limitation - HELD THAT:- The products in question are PVC Krishi Pipes of the burst pressure of 1.0 Mpa, PVC suction pipes of burst pressure of 1.5 Mpa and PVC Garden Pipe of 0.7 Mpa. Thus the products have the pressure of much less than 27.6 Mpa as is minimum required under chapter 3917.31. This particular observation is sufficient for us to hold that the product cannot be classified under section 3917.31. Thus, the products being one or the other kind of pipe that have been classified under section 39 in the category of 3917.39. All flexible or non-flexible tubes, pipes and hoses are excisable goods even if they are classified under chapter heading 3917.31 having work pressure of more than 27.6 Mpa and are also excisable and the duty of 16% is to be levied as per Central Excise Act. These observations coupled with the admission of the appellant that the product is classifiable are sufficient for us to hold that except for the burst pressure criteria, any pipe, tube or hose is excisable goods. The burst pressure of appellant s product is admittedly less than 27.6 Mpa as is minimum required to claim exemption. None of the grounds of the appellant assessee as mentioned above affect the said excisability. Resultantly, we do not find any infirmity in the order denying the classification of the impugned goods under 3917.31 and holding it as a product classifiable under 3917.39 i.e. the hollow pipes which do not find any other classification in the said chapter, the demand confirmed is, therefore, sustainable. Extended period of limitation - Penalty - HELD THAT:- Since the appellant is found to have wrongly classified his product to such a category to which no duty is leviable, the goods are otherwise excisable, the act is held as wilful intention to evade the duty - The said act of the appellant is definitely an act of misrepresentation of the facts - adjudicating authority was right to invoke the extended period of limitation and the penalties are also held to have been rightly imposed. Appeal dismissed. 2019 (7) TMI 197 CENVAT Credit - inputs - CR sheets dies, etc - alleged wrongful description of raw material - Revenue entertained a view that as per description of goods in the invoices, the goods cannot be used in the furnace installed by the appellant for further manufacturing of ingots - penalty - HELD THAT:- The credit sought to be denied to the appellant on the ground that CR coils of small length cannot be the inputs for the appellant to be used in their final products. The only allegation on the basis that the said HR/CR coils can be used by cycle manufacture to manufacture their final products - The said allegation has been made on the basis of assumptions and presumptions. During the course of investigation, both suppliers as well as manufacturer-buyer have stated in their statements that they have supplied the goods, in question to the appellant, who received the goods. There is no evidence placed on record by the Revenue that the goods in question have not been received by the appellant-manufacturer. Merely adding the word rejected scrap in the invoice cannot be the reason to say that the goods were not received by the appellant and there is no such evidence placed on record by the Revenue. The said goods used by the appellant in the manufacture of final products. The Revenue has to prove if the said goods have been diverted or not used by the appellant in the manufacture of their final products then from where the inputs have been procured by the appellant to manufacture final products. There is no statement of transporter to that extent has been brought on record. The Revenue has failed to produce any evidence to show that the inputs in question have not been used by the appellant in the manufacture of their final products. Therefore, the demand is on the basis assumptions and presumptions, hence, cannot be confirmed by denying the credit to the appellants - the benefit of doubt goes in favor of the appellants - Credit allowed - penalty also not imposable. Appeal allowed - decided in favor of appellant. 2019 (7) TMI 196 CENVAT Credit - illegal availment of CENVAT credit without actual receipt of inputs/raw materials - fake invoices - HELD THAT:- It is a settled principle of rule of evidence that admission needs no further proof (Section 58 of the Indian Evidence Act). Therefore, the only dispute concerning which appellants are before this forum is the duty demand on the balance of raw material that was found to have short fall during physical stock taking done by DGCEI. Appellants attributed the loss to pilferage and mud deposit but simultaneously admitted through the statement of Managing Director that concerning pilferage, no police report was lodged nor any record was produced to substantiate the same. Having regard to Rule 9(5) of the CENVAT Credit Rules, 2004 whereby burden of proof is on the appellants to establish the admissibility of CENVAT credit, there is no convincing ground established by the appellant that would require interference in the order passed by the Commissioner of Central Excise. Appeal dismissed - decided against appellant. CST, VAT & Sales Tax 2019 (7) TMI 195 Form F - Maharashtra VAT Act - inaction on the part of the Respondent No. 1 Deputy Commissioner of Sales Tax in issuing Form F - stock transfer - HELD THAT:- The Respondent No. 1 directed to dispose of the petitioner's representation dated 05th September 2018 as expeditiously as possible and preferably within a period of 12 weeks from today - petition disposed off. 2019 (7) TMI 194 Rejection of Books of accounts - rejection on the basis of surmises and conjectures - Whether even otherwise the selling rate of coal could have been enhanced by making addition to the freight charges in absence of any material in support thereof? - HELD THAT:- Perusal of the assessment order reveals that the reason for making the enhancement to the freight charges is only one, being non-production of part freight receipts. Even if that reason can be accepted as a reason to make the estimation, the assessment order does not disclose the basis on which the enhancement had been made to the freight charges. Neither there is any exemplar relied upon by the Assessing Authority nor there is any intimation received from the seller or transporter or railways in support of the conclusion reached with respect to suppression of the freight charges - answered in the negative i.e. in favour of the revenue and against the assessee. HELD THAT:- It is vital in the facts of the present case that the entire quantities of coal had been produced by the assessee from a single purchaser from M/S Bharat Coking Coal Ltd., Dhanbad. Some freight receipts had also been produced by the assessee disclosing the freight charges paid to that seller that have not been doubted or disbelieved. The Assessing Authority could not have recorded a subjective satisfaction that there was suppression of freight charges. The same mistake has been committed by the first appellate authority in affirming the findings with respect to suppression of freight charges - The enhancement made on account of freight charges is clearly unsustainable as it is not based on any material or valid consideration. Rather, the same is found to have been made on purely subjective satisfaction devoid of any evidentiary basis - answered in the negative i.e. in favour of the assessee and against the revenue. Revision allowed in part. 2019 (7) TMI 193 Release of seized goods - ownership of goods could not be proved - Section 34 (2) of the DVAT Act - HELD THAT:- Clearly, the goods cannot be released to the Petitioners unless they prove ownership of such goods. The directions issued by this Court in the judgment dated 12th February 2016 are clear. The DT T was required to get to the bottom of the entire case and unearth the complete facts not only regarding the goods that were seized on 1st March 2014, but also with regard to the modus operandi deployed not only by the Petitioners but also in other similar instances. The Court had noted that this could not have and in fact was not a solitary instance where valuable goods in the form of gold and silver jewellery and even cash were being transported from one State to the other through road and rail without any proper checks either by the DT T or the Police. There was no stay of the proceedings of the Committee at any stage. Irrespective of the deliberate failure of the Petitioners to participate in the verification exercise, it was incumbent upon the Committee constituted by the CTT to have concluded its proceedings and determined whether the documents submitted by the Petitioners were genuine and whether the documents proved their ownership of the seized goods. This exercise could not have gone on endlessly and that too for over three years. As far as the Petitioners objections to the constitution of the Committee by the CTT is concerned, as already noticed hereinbefore, there was no legal basis for the Petitioners to question the constitution of such a committee. The Petitioners not having challenged the judgment dated 12th February 2016 passed by this Court negating their pleas, could not have turned around to question the constitution of the committee - The Court accordingly hereby negatives the objections raised by the Petitioners to the constitution of the Committee by the DT T and directs the Committee to now conclude its proceedings by preparing and releasing its report on the documents submitted by the Petitioners not later than 31st July 2019. Petition disposed off. 2019 (7) TMI 192 Rejection of books of accounts to make Best Judgement assessment - running of Brick Klin - estimation of firing period - HELD THAT:- In the first place, the conclusion drawn by the authorities as to rejection of books of account cannot be seriously disputed in the present case, as the assessee did not produce the books of account. Though he may have made an application for compounding, however upon rejection of that application for the purpose of making a regular assessment, the books would remain a requirement to be fulfilled by the assessee. In absence of those books, the authorities have not erred in rejecting the same and in consequentially proceeding to make the best judgment assessment. Quantification of the turnover - HELD THAT:- In the first place, some elbow room has to be allowed to the revenue authorities while making estimation and no rule of exact measurement can be enforced against the assessing authority in this regard. In so far as the estimation is based on a valid and relevant consideration, the same does not call for any further or microscopic examination. In the facts of the present case, keeping in mind the admitted facts of the survey dated 06.05.2001 wherein the substantial amount of under production bricks and coal were found existing and also it was noted that the brick kiln was running, it is difficult to accept the submission advanced on behalf of the assessee that the brick kiln would have stopped running on 10 May, 2001, keeping in mind the general tendency of the industry - the estimation of the firing period made by the Tribunal is found to be based on relevant consideration - the same cannot be faulted. Revision dismissed. Indian Laws 2019 (7) TMI 191 Maintainability of suit - Order 7 Rule 11(d) of the Civil Procedure Code - HELD THAT:- The appellant(s) cannot claim any right merely on the basis of a self serving allotment letter pertaining to the concerned flat, purportedly given by the builder. Noticeably, contends learned counsel for respondent No.1 that the averments in the plaint(s) regarding allegation of fraud played upon the appellant(s) are vague and general. The same are baseless and unsubstantiated. We do not deem it necessary to elaborate on all other arguments as we are inclined to accept the objection of the appellant(s) that the relief of rejection of plaint in exercise of powers under Order 7 Rule 11(d) of CPC cannot be pursued only in respect of one of the defendant(s). In other words, the plaint has to be rejected as a whole or not at all, in exercise of power Order 7 Rule 11 (d) of CPC. Indubitably, the plaint can and must be rejected in exercise of powers under Order 7 Rule 11(d) of CPC on account of noncompliance of mandatory requirements or being replete with any institutional deficiency at the time of presentation of the plaint, ascribable to clauses (a) to (f) of Rule 11 of Order 7 of CPC. In other words, the plaint as presented must proceed as a whole or can be rejected as a whole but not in part. In that sense, the relief claimed by respondent No.1 in the notice of motion(s) which commended to the High Court, is clearly a jurisdictional error. The fact that one or some of the reliefs claimed against respondent No.1 in the concerned suit is barred by Section 34 of 2002 Act or otherwise, such objection can be raised by invoking other remedies including under Order 6 Rule 16 of CPC at the appropriate stage. These appeals must succeed on the sole ground that the principal relief claimed in the notice of motion filed by respondent No.1 to reject the plaint only qua the said respondent and which commended to the High Court, is replete with jurisdictional error - appeal allowed.
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