Newsletter: Where Service Meets Reader Approval.
TMI Tax Updates - e-Newsletter
September 6, 2024
Case Laws in this Newsletter:
GST
Income Tax
Customs
Insolvency & Bankruptcy
PMLA
Service Tax
Central Excise
CST, VAT & Sales Tax
Indian Laws
Highlights / Catch Notes
GST
-
Accused's Right to Statutory Bail: When Probe Delays Impede Justice.
-
GST authorities can't bypass procedural safeguards by invoking IPC instead of GST Act for offences covered under GST Act.
-
Non-payment of tax, excess ITC claimed: Petitioner gets rehearing, ordered to deposit Rs.10 lakh pre-deposit.
-
Input Tax Credit disallowed due to delay challenged; Court orders reassessment considering amendments and other issues.
-
Unfair tax assessment due to improper notice delivery, order quashed. Taxpayer to deposit 25% disputed tax, file objections.
-
Importer mistakenly omitted IGST from returns but allowed to claim credit upon submitting bills of entry.
-
Penalty imposed for tax return discrepancy; Court orders fresh hearing for petitioner's objection within 2 weeks.
Income Tax
-
Land sale and investment source scrutinized; reopening assessment disallowed due to lack of new evidence.
-
Seized cash can't be treated as advance tax; must follow prescribed process for dealing with seized assets under Income Tax Act.
-
Faceless assessment mandatory for central charges & international taxation; notices by Joint AO illegal.
-
Trust exemption denied for late Form 10B filing, but court condones delay citing genuine hardship.
-
Taxpayer's delay in filing form should not deny concessional 22% rate, if intention clear from return.
-
Income Tax reopening for unsecured loans impermissible after prior consideration.
-
Penalty for underreporting long-term capital gains rejected due to bona fide disclosure.
-
Exemption claim denied due to lack of statutory notification.
-
Equality, Consistency & Taxability: Property Income, Capital Gains & Joint Development Contracts.
-
Charitable Trust's registration cancellation: Tribunal remands case for fresh consideration of objects beyond religious community benefit.
-
Charitable Trust's Registration Upheld Despite Minor Deed Amendments.
Customs
-
Customs valuation: Excluding unrelated fees from transaction value.
-
Electrical parts like PCBs, ICs, LEDs, etc. import classification upheld for most items under Chapter 85 over department's view.
-
Customs classification dispute resolved: Imported goods correctly classified as 'Other' not 'Light oils'.
-
Customs Duty Amendment Conundrum: Importers Seek Consistency Amid Regulatory Maze.
-
Vitamin AD3 import duty dispute: Feed additive rightly classified as synthetic vitamin under CTH 2936, duty upheld but penalty waived.
-
Customs dispute over classification of imported petroleum product: Eligible for duty exemption or not?
Indian Laws
-
SC: Res Judicata Flexibility for Public Projects, Truth Outweighs Technicalities.
IBC
-
Petition dismissed: Resolution plan disclosure valid, corporate debtor's clean slate approved, creditor interests balanced.
PMLA
-
Accused granted bail in coal theft case balancing gravity of crime and right to speedy trial after 28 months in custody.
Service Tax
-
Promotion/Marketing of Lotteries Not Taxable as Business Auxiliary Service.
-
Buses hired out for 24/7 transportation services, not rent-a-cab as ownership/possession not transferred.
Central Excise
-
Packaged food prep duties: Sealed containers granted exemption.
-
Legal Triumph: Flawed Investigation Nullifies Tax Demands on Cenvat Credits and Vehicle Usage.
Articles
Notifications
News
Case Laws:
-
GST
-
2024 (9) TMI 235
Proper SCN or not - cancellation of registration and action of suspending the registration - SCN does not contain necessary details on the strength of which such a conclusion has been drawn - violation of principles of natural justice - HELD THAT:- Since the show-cause notice and suspension of registration is founded upon a cryptic notice dated 29.02.2024, both are set aside. On regular basis, this kind of notices are painfully noticed, whereby, without assigning adequate reasons, the business of taxpayer is suddenly suspended. In absence of basic reasons available in the show-cause notice, the party aggrieved by it cannot even prefer an effective representation. It is wondered how in such an insensitive and mechanical manner, the registrations are being suspended by issuing defective show-cause notices. Such orders certainly have an adverse impact on the livelihood of taxpayer and hits Article 21 of the Constitution. Learned counsel for the petitioner insisted for imposition of costs. Faced with this, Sri P.Sri Harsha, learned Assistant Government Pleader, submits that he will appraise the authorities about observation of this Court so that henceforth such mistakes do not occur - costs not imposed. The impugned show-cause notice dated 29.02.2024 and the order suspending the registration are set aside - Petition allowed.
-
2024 (9) TMI 234
Challenge to admission of statutory bail u/s 167 (2) of the CrPC - generation of fake invoices by dummy entities - HELD THAT:- Section 167 (2) (a) (ii) of the CrPC is a beneficial provision granting relief to the accused where the investigating agency is not able to complete the investigation within a period of sixty or ninety days as the case may be. It categorically provides that once the prosecuting agency is unable to complete the investigation within the time provided, the benefit cannot be denied to the accused. The right to apply for statutory bail under Section 167 (2) (a) (ii) has been recognized by the Hon ble Apex Court as a Constitutional right. It appears that in the initial stages, serious allegations were made regarding tax evasion of a huge amount of money and the respondent having employed unscrupulous means to pass on the undue advantage of the Input Tax Credit generated by bogus entities on the basis of fictitious invoices and sales to various companies. However, it is peculiar that no complaint has still been filed till date. It is unclear as to why the petitioner department has been contesting the present case for such a long period of time in regard to the custody of the respondent, when the department is obviously not concerned with taking the case to its logical conclusion. This Court fails to understand why despite more than five years having elapsed, no complaint is filed in the present case, even though, at the time of opposing the bail of the respondent, serious allegations were made that the case involves a large amount of public money. There are no merit in the present petition - petition dismissed.
-
2024 (9) TMI 233
Jurisdiction - invocation of penal provisions under Indian Penal Code by GST Authorities, without invoking the penal provisions of GST Act, when the alleged offences are covered under the provisions of GST Act and that too without obtaining Sanction under Section 132(6) of GST Act - prosecution so launched is hit by legal bar against the institution or continuance of the proceedings so as to warrant quashment or not. HELD THAT:- Upon perusal of record, it is apparent that the petitioner herein had been summoned under Section 70 of GST Act vide Summon dated 11.08.2021 and he had given his statement with GST Authorities and thereafter no action under GST Act was taken against the petitioner by GST Authorities. GST authorities conducted search and seizure operations while exercising powers under Section 67(2) of GST Act, on the premises of M/s. Shreenath Soya Exim Corporate and prepared inspection report dated 04.07.2022, in which it has been alleged that Shri Vaibhav Laxmi Industries was bogus firm and has been fraudulently registered, which issued invoice/bill without supply of goods/services leading to wrongful availment or utilisation of input tax credit/refund of tax. Upon perusal of inspection report dated 04.07.2022 along with FIR, it becomes quite apparent that there is no allegation against the petitioner of forming the bogus firm and even if the allegations. In the considered opinion of this court, GST Act, 2017 is a special legislation which holistically deals with procedure, penalties and offences relating GST and at the cost of repetition this court cannot emphasise more that the GST Authorities cannot be permitted to bypass procedure for launching prosecution under GST Act, 2017 and invoke provisions of Indian Penal Code only without pressing into service penal provisions from GST Act and that too without obtaining sanction from commissioner under Section 132(6) of GST Act especially when the alleged actions squarely fall within the precincts of offence as enumerated under GST Act, 2017. This court has no hesitation in holding that GST Authorities cannot bypass procedure prescribed under GST Act for launching prosecution by simply invoking penal provisions under IPC without invoking penal provisions under GST Act especially when the allegations so revealed as a result of search and seizure conducted by GST Authorities constituted offence covered under the penal provisions of GST Act as that would amount to bypassing procedural safeguards as provided under Section 132(6) of GST Act which requires sanction of the commissioner prior to initiation of prosecution, which is to the prejudice of the petitioner herein. Letting GST Authorities to adopt such course of action would amount to abuse of process of law which cannot be permitted by this court. This petition deserves to be allowed and is hereby allowed.
-
2024 (9) TMI 232
Challenge to adjudication order passed u/s 73 of the CGST/WBGST Act, 2017 - discrepancies in returns - short payment of tax/excess availment of Input Tax Credit (ITC) - HELD THAT:- The proper officer should afford a fresh opportunity of hearing to the petitioner. However, at the same time taking note of the fact that a determination has already been made, the petitioner is directed to deposit towards pre-deposit, with the respondents a sum of Rs.10 lakhs within a period of two weeks from date. In the event the petitioner deposits the aforesaid sum within a period of two weeks from date, the proper officer having regard to the deposit made by the petitioner and in the peculiar facts of the case shall decide the matter afresh by giving an opportunity of hearing to the petitioner. The petitioner shall be at liberty to rely on additional documents. The deposit made by the petitioner shall be retained to the credit of the proceeding till a fresh decision is taken by the proper officer. The writ petition is disposed of.
-
2024 (9) TMI 231
Cancellation of GST registration of petitioner - failure to submit necessary documents - HELD THAT:- It is relevant to note that the cancellation of a taxpayer s GST registration does not absolve the taxpayer from discharging its liability or for any statutory non-compliance. It also does not preclude the concerned authority from taking any action for any statutory violation or for recovery of dues, if any. It follows that the application for cancellation of GST registration cannot be withheld for assessing the petitioner s liability. The same has also been clarified by the Central Board of Indirect Taxes and Customs (CBIC) by the circular being F. No. CBEC/20/16/04/2018-GST dated 26.10.2018. It is considered apposite to direct the concerned authority to process the application dated 21.08.2024 of the petitioner for cancellation of its GST registration within a period of four weeks from date, bearing the aforesaid in mind. However, the petitioner is required to furnish KYC documents and provide for an address for future communications. Petition disposed off.
-
2024 (9) TMI 230
Violation of principles of natural justice - non application of mind - impugned order has been passed without considering the petitioner's objection - Revenue would submit that the petitioner has submitted his reply on 25.03.2024 and the respondent authority would now redo the assessment taking into account the objection / reply. HELD THAT:- The petitioner is granted liberty to appear before the respondent on 11.09.2024 and it is open to the petitioner to submit additional representation and also furnish documents in support of his contention. If any such submission / materials are placed, the same shall be considered and orders shall be passed, after affording the petitioner reasonable opportunity of personal hearing. Petition disposed off.
-
2024 (9) TMI 229
Appeal rejected on the ground that the petitioner has not complied with the mandatory condition of pre-deposit of 10% of the disputed tax - grievance of the petitioner is however the dismissal of the appeal without putting the petitioner on notice of the non-compliance relating to pre-deposit for entertaining the appeal resulting in denial of an opportunity to the petitioner to demonstrate/establish that the statutory pre-deposit has been complied with. HELD THAT:- This Court finds merit in the above grievance. In the circumstances, this Court is of the view that the matters may be remitted back to the appellate authority. The petitioner shall establish that all the conditions relating to appeal including pre-deposit is complied with. If the petitioner is able to establish the same, the appellate authority will proceed to examine and pass orders on merits, failing which the impugned order of dismissal of appeal shall stand revived. Petition disposed off.
-
2024 (9) TMI 228
Challenge to assessment order - Input Tax Credit has been disallowed only on the ground that the claims have been lodged beyond the period prescribed under Section 16(4) of the GST Acts - HELD THAT:- The impugned order, dated 30.04.2024 is set aside. The learned assessing adjudicating authority/respondent would re-do the assessment by taking into account the amendment referred supra. Apart from the issue relating to Section 16(4) of the GST Acts, there are three other issues viz., a) ineligibility to avail Input Tax Credit in terms of Section 17(5) of the GST Act b) Ineligible ITC declaration and c) excess ITC claimed inasmuch as, outward supplies not supported by E-way bills and discrepancies existing between GSTR-9 and GSTR-01. Since this Court is inclined to set aside the order insofar as it relates to invoking Section 16(4), assessing authority is also directed to reconsider the submissions of the petitioner with regard to the three other issues. The petitioner is at liberty to file their objections in respect of all the issues including Section 16(4) within a period of four weeks from the date of receipt of a copy of this order. The petition is disposed off.
-
2024 (9) TMI 227
Violation of principles of natural justice - proper service of SCN or not - SCN as well as the impugned order was uploaded in the GST portal - mismatch between GSTR-7 and GSTR-3B - HELD THAT:- The impugned order is set aside and the petitioner shall deposit 25% of the disputed tax within a period of two (2) weeks from the date of receipt of a copy of this order. On complying with the above condition, the impugned order of assessment shall be treated as show cause notice and the petitioner shall submit its objections within a period of four (4) weeks from the date of receipt of a copy of this order along with supporting documents/material. If any such objections are filed, the same shall be considered by the respondent and orders shall be passed in accordance with law after affording a reasonable opportunity of hearing to the petitioner. Petition disposed off.
-
2024 (9) TMI 226
Failure to reflect the IGST details in GSTR-2A rectification application - HELD THAT:- A perusal of records reveals that the petitioner has paid Integrated Goods and Services Tax amounting to Rs. 85,70,105/- on the imported Goods and the same is not in dispute. It is also not in dispute that the petitioner availed Input Tax Credit of the IGST paid on the imports as permissible under the SGST Act. Though the petitioner filed GSTR-2A returns for the relevant period reflecting IGST details, while filing GSTR-3B returns for the months of July, August, September and October 2017, the petitioner inadvertently omitted to include the IGST details of Rs. 85,70,105/-. The learned Special Government Pleader also submitted that if the relevant Bill of Entries are submitted, the same will be considered by the authorities. This Court is inclined to set aside the impugned Order subject to conditions imposed - petition disposed off.
-
2024 (9) TMI 225
Levy of penalty under Section 73 of SGST and CGST - alleged difference between the value of supply reported in GSTR 3B and GSTR 1 - HELD THAT:- The Revenue do not have any serious objection, considering the fact that, the entire tax and interest and the petitioner is now coming forward to pay 10% of the penalty and the petitioner was unable to participate only due to his ill-health. In view thereof, the writ petition stands disposed of by setting aside the impugned order and directing the first respondent to pass orders afresh after providing the petitioner an opportunity of hearing. The petitioner shall submit their objection within a period of two weeks from the date of receipt of a copy of this order. If any such objection is filed, the same would be considered and orders passed in accordance with law, after granting reasonable opportunity. Petition disposed off.
-
Income Tax
-
2024 (9) TMI 224
Deduction u/s 37(1) - expenditure incurred by the respondent/assessee towards Corporate Social Responsibility - as decided by HC [ 2023 (1) TMI 779 - DELHI HIGH COURT] expenditure is not in the nature of capital expenditure - expenditure is laid out or expended wholly and exclusively for the purposes of the business or profession. Deduction qua the expenditure incurred is not of the nature as specified u/s 30 to 36 of the Act. Insofar as the third criterion is concerned, there is no dispute, that the expenditure claimed does not fall under any of the sections referred to in 37(1) of the Act i.e., Sections 30 to 36. As far as the other aspects are concerned, as noted by the Tribunal, in the past, CSR expenses had been allowed as deductible expenditure u/s 37(1). Therefore, the only aspect, which appears to have been agitated before the Tribunal, was that Explanation 2 appended to Section 37(1) was retrospective in nature. This Explanation was inserted, as noted above, by Finance Act, 2014 with effect from 01.04.2015. HELD THAT:- We see inadequate explanation for the delayed filing. Accordingly, the Special leave petition stands dismissed on the ground of delay. Pending application(s), if any, shall stand disposed of.
-
2024 (9) TMI 223
Ceasure of income tax settlement commission - restriction to the filing of the application before the Interim Board for Settlement - As decided by HC [ 2023 (11) TMI 1111 - MADRAS HIGH COURT] Section 245C(5) of the Income Tax Act, 1961 (as amended by the Finance Act, 2021) is read down by removing the retrospective last date of 1st date of February, 2021 as 31st day of March, 2021 and Consequently the last date of eligibility mentioned paragraph 4(i) of the impugned circular dated 28.09.2021 shall also be read as 31.03.2021 and all the applications in respect of the petitioners even in respect of the cases arising between 01.02.2021 to 31.03.2021 shall be deemed be pending applications and shall be deemed to be pending applications for the purposes of consideration by the Interim Board HELD THAT:- Following the order passed by this Court in Union of India and Ors. vs. Velammal Chennai Educational Trust [ 2024 (9) TMI 101 - SC ORDER] this Special Leave Petition stands dismissed. We also note that in the aforesaid case, petitioners had in fact withdrawn the Special Leave Petition(s) and the same was dismissed as withdrawn. This Special Leave Petition is dismissed in view of the above. Pending application(s), if any, shall stand disposed of.
-
2024 (9) TMI 222
Faceless assessment of income escaping assessment - validity of notice issued by the JAO as not in accordance w/sec 151A - not permissible for the Jurisdictional Assessing Officer to issue a notice under Section 148, as the same would amount to breach of the provisions of section 151A - HELD THAT:- As decided in recenet case recent decision of this Court in Nainraj Enterprises Pvt. Ltd. [ 2024 (7) TMI 511 - BOMBAY HIGH COURT ] relying on Hexaware Technology Ltd. [ 2024 (5) TMI 302 - BOMBAY HIGH COURT ] provisions of Section 151A of the IT Act had clearly brought a regime of faceless assessment. The Court held that it was not permissible for the Jurisdictional Assessing Officer to issue a notice under Section 148, as the same would amount to breach of the provisions of section 151A of the IT Act. There is no question of concurrent jurisdiction of the JAO and the FAO for issuance of notice under Section 148 of the Act or even for passing assessment or reassessment order. When specific jurisdiction has been assigned to either the JAO or the FAO in the Scheme dated 29th March, 2022, then it is to the exclusion of the other. To take any other view in the matter, would not only result in chaos but also render the whole faceless proceedings redundant. If the argument of Revenue is to be accepted, then even when notices are issued by the FAO, it would be open to an assessee to make submission before the JAO and vice versa, which is clearly not contemplated in the Act. Therefore, there is no question of concurrent jurisdiction of both FAO or the JAO with respect to the issuance of notice under Section 148. When an authority acts contrary to law, the said act of the Authority is required to be quashed and set aside as invalid and bad in law and the person seeking to quash such an action is not required to establish prejudice from the said Act. An act which is done by an authority contrary to the provisions of the statue, itself causes prejudice to assessee. All assessees are entitled to be assessed as per law and by following the procedure prescribed by law. Therefore, when the Income Tax Authority proposes to take action against an assessee without following the due process of law, the said action itself results in a prejudice to assessee. Decided in favour of assessee.
-
2024 (9) TMI 221
Validity of reopening of assessment u/s 147 - reasons to believe - difference between the change of opinion and reasons to believe - Classification of income as capital gains or business income - source and genuineness of investment made as well as short term capital gain received by the assesee remained unexplained - HELD THAT:- No document has been produced by the respondents to show that they had any new information or documentary evidence for reopening of the case while the power is available with them. The same has to be exercised carefully and sanctity of assessments already done should be maintained. Merely because a new assessing officer may not be happy with the manner in which assessment was done earlier, cannot be a reason to review assessment. The power available, as noticed above, is of reassessment and not of review of earlier assessment. Petitioner had challenged the order and notice as well as show cause notice along with the draft assessment order before this Court. When the case came up before the Court, it was informed that the Revenue has passed the final assessment order which actually had not been passed. By that time when the case was taken up, the apology was accepted by this Court of giving a wrong statement in the Court, however, the petitioner was allowed to challenge the final assessment order. AO has now completely changed his stand from what he had taken while issuing the draft assessment order. There is no show cause notice issued to the petitioner alleging that the income was acquired as adventure in the nature of business . From the show cause notice, we find that the same was categorized as escape in assessment on account of treating it as a short-term capital gain and unexplained source of investment - Such change of reasons for reassessment and treating the income to be under the heading of adventure in the nature of business , is clearly based on surmises of the AO. There was no evidence produced in support of any agricultural activity and would now, therefore, claim under the capital gain under Section 10 (37) of Section 54 of the Act. But the assessee, as we find, had not claimed it as a capital gain, but has at all times asserted the same to be falling beyond the municipal limits and, therefore, beyond the provisions of Section 2 (14) (iii) of the Act. His contention has been supported by the report of the ITO (Intelligence). AO does not refer either to the report of the ITO (Intelligence) nor to the submissions of the assessee. We, thus, find it a case of colourable exercise of power. When an authority is empowered to exercise and pass orders in terms of the Act, it has to remain within the four corners of the manner in which the said power is required to be exercised. Once the basis for re-opening of the case u/s 147 of the Act is of non-disclosure of income under the capital gain and non-disclosure of sources of investment, the A.O. had no authority available in law to pass order holding that income had escaped assessment, which was following as adventure in the nature of business . We also find that the petitioner had purchased agricultural land from three agriculturists, namely, Manjeet Singh, Karnail Singh and Jarnail Singh. He had disclosed in his earlier return of the amount having been obtained from release of FDRs. Further selling of the agricultural land to M/s DSS Megacity Projects Private Limited would not even come within the ambit of capital asset and no capital gain was liable to be taxed. It is an admitted position that the land was agricultural and beyond the municipal limits, and therefore, would not come within the ambit of Section 2 (14) (iii) (a) of the Act which required conducting of agricultural activity and would be agricultural land within the ambit of Section 2 (14) (iii) (b) of the Act. In the present case, we are satisfied that there is no case of escaped income also as the said aspect stood already noticed vide final assessment order passed after conducting an enquiry by the A.O. at the relevant time based on the report of the ITO (Intelligence), Karnal. Thus, we are satisfied that the assessment proceedings as undertaken in 2016 did not warrant any interference or warrant any reopening for fresh assessment. The entire proceedings initiated vide notice dated 20.03.2020 are contrary to law and are found to be illegal. Accordingly, the same shall not be sustainable in the eyes of law. The writ petition is accordingly allowed.
-
2024 (9) TMI 220
Adjustment of seized cash against tax liability - Application of seized or requisitioned assets u/s 132B - HELD THAT:- The appellants claim that cash seized from the possession of Sarup Chand should be treated as cash seized from the possession of appellants and it should be adjusted against their tax liability under Section 140A read with Section 153A of 1961 Act. Section 132B provides for application of seized or requisitioned assets. It provides that assets seized under Section 132 or requisitioned u/s 132A shall be dealt with in the manner prescribed therein. From the conjoint reading of Sections 140A, 132B and 234B, it is evident that while determining tax liability, the tax deducted or collected at source as well as advance tax is deducted from the total liability. The appellants have not paid advance tax and they are wrongly claiming that in view of Section 132B the amount recovered from the possession of Sarup Chand should be treated as advance tax payable by them. The alleged amount was concededly lying deposited in the bank account of Sarup Chand and till the determination of liability of all the parties, there was no question of adjustment of seized cash against the liability of appellants. They were liable to pay interest in terms of Section 234B on account of delayed payment on advance tax. In the wake of above discussion and findings, we are of the considered opinion that amount seized from the possession of Sarup Chand could not be treated as cash belonging to appellants from the date of seizure and it could not be adjusted on the said date against their tax liability. Revenue has correctly adjusted seized cash from the date of framing of assessment and charged interest u/s 234B on delayed payment of advance tax. As we are of the considered opinion that amount seized from the possession of Sarup Chand could not be treated as cash belonging to appellants from the date of seizure and it could not be adjusted on the said date against their tax liability. The Revenue has correctly adjusted seized cash from the date of framing of assessment and charged interest u/s 234B on delayed payment of advance tax. Decided in favour of assessee.
-
2024 (9) TMI 219
Faceless assessment of income escaping assessment - validity of notice issued by the JAO as not in accordance w/sec 151A - Applicability of the faceless mechanism under Section 144B and Section 151A - as argued the provisions of section 151A and the scheme notified by the Central Government dated 29 March, 2022, cannot be made applicable to the present case which relates to an assessment falling under international taxation charge. HELD THAT:- We are not inclined to accept the case of respondents that the provisions of Section 144B read with the provisions of Section 151A (1) would not be applicable to the case in hand. The reason being the challenge in the present proceedings is to a notice issued under section 148 of the Act and the prior proceedings as initiated against the petitioner under section 148A (a) (b). We cannot read the order to mean that it would cover the proceedings under Section 148A and Section 148 of the Act so as to fall within the ambit of the said order, as it is only the assessment proceedings which would be required to be conducted as an exception to the faceless mechanism. We have clearly observed that the order dated 31 March, 2021 cannot be read to mean that it would cover the proceedings under Section 148A and Section 148 of the Act so as to fall within the ambit of the said order, as it was only the assessment proceedings which were required to be undertaken as an exception to the faceless mechanism, under the said order. In other words, we had clearly held that the faceless mechanism would also be applicable to cases of Central Charges and International Taxation charges and it is only the assessment proceedings which would be required to be undertaken outside the faceless mechanism. We have thus reached a considered conclusion that the mandatory faceless procedure for issuance of notice under section 148 of the Act falling within the purview of the scheme notified by the Central Government dated 29 March, 2022 would not exclude the Central charges and International taxation charges from the application of the faceless mechanism as notified under section 144B read with section 151A of the Act. The result of the above discussion is to the effect that this Court not only in Hexaware [ 2024 (5) TMI 302 - BOMBAY HIGH COURT] and thereafter in CapitalG LP [ 2024 (8) TMI 567 - BOMBAY HIGH COURT] but also Sri Venkataramana Reddy Patloola [ 2024 (9) TMI 100 - TELANGANA HIGH COURT] to have consistently held that in respect of central charges and international taxation charges, the proceedings under Section 148A read with Section 148 of the Act would be required to be held in a faceless manner, applying the provisions of section 144B and as effected under the provisions of section 151A read with scheme notified by the Central Government vide a Notification dated 29 March, 2022. We accordingly reject the contentions as urged by the revenue that the present case would fall outside the applicability of the said provisions and the scheme. Now coming to the facts of the case, as the notices were issued by the JAO certainly they fall outside the purview of the faceless mechanism and on that count as held in the decision of Hexaware, the same would be required to be held to be illegal and without jurisdiction. We may also observe that the proceedings would also stand covered by the decision of this Court in Kairos Properties Pvt. Ltd.[ 2024 (8) TMI 559 - BOMBAY HIGH COURT] in which the Court has held the scheme to be applicable to the procedure to be adopted under section 148A of the Act as well. Decided in favour of assessee.
-
2024 (9) TMI 218
Validity of reopening assessment - non dealing with the objections filed by the petitioner relying upon letter filed by the petitioner in response to the notice issued u/s 133 (6) - HELD THAT:- Though the petitioner has requested the respondent to provide information on basis of which impugned notice under section 148 of the Act is issued, however, same is never supplied and therefore, the petitioner raised objections on the basis of information available from record only. Considering the above undisputed facts, without entering into the merits of the matter, the impugned order disposing the objections of the petitioner is hereby quashed and set aside and the matter is remanded back to the AO to give an opportunity of hearing to the petitioner so as to consider the objections filed by the petitioner in detail in response to the impugned notice u/s 148. AO is also directed to provide information in his possession which is referred to and relied upon in the reasons recorded for issuance of the impugned notice u/s 148 of the Act and the petitioner shall be at liberty to file further reply if required on basis of such information.
-
2024 (9) TMI 217
Denial of exemption u/s 11 - Assessment of trust - Rejection of application for condonation of delay in filing Form 10B - whether reasons given by the petitioner for delay cannot be considered as genuine hardship ? - petitioner has shown the inadvertent delay on part of the clerical staff of the Chartered Accountant who was suffering from brain tumor - HELD THAT:- It is not in dispute that the audit report in Form 10B was obtained on 07.05.2015 that is prior to the date of filing of the return on 26.09.2015. Though the circular No. 2 of 2020 issued by the CBDT provides for condonation of delay in filing Form 10B for Assessment Year 2016-17, is issued for Assessment Years 2016-17 and 2017-18, the same analogy would apply for Assessment Year 2015-16 also and as the petitioner has shown the inadvertent delay on part of the clerical staff of the Chartered Accountant who was suffering from brain tumor, the same cannot be discarded from purview of genuine hardship. The reasons assigned by the respondent are also not proper inasmuch as the respondent has adopted a pedantic approach in rejecting the application to condone the delay. Thus, it is apparent that the respondent instead of considering the technical compliance of filing audit report which was issued by the Chartered Accountant on 07.05.2015 even prior to the due date of filing of the return which could not be uploaded, ought to have condoned the delay. The petition succeeds and accordingly allowed. The impugned order is hereby quashed and set aside and the respondent is directed to pass an order to condone the delay in filing the Form 10B i.e. Audit Report so as to enable the petitioner to get the exemption u/s 11.
-
2024 (9) TMI 216
Taxation u/s 115BAA - denial of benefit of lower rate of tax of 22% on delay in filing Form 10-IC by the petitioner - return of income filed by the petitioner in Form of Return of Income i.e. ITR-6 - HELD THAT:- Petitioner has filed the return of income under section 139 (1) of the Act before the due date by applying the provisions of section 115BAA of the Act. Respondent No. 2 ought to have condoned the delay in filing Form 10-IC by the petitioner instead of rejecting the review application filed by the petitioner on technical ground as in substance, the petitioner has exercised the option for lower rate of tax u/s 115BAA of the Act which is clear from the computation of income available on record. Even in Form ITR-6, the petitioner has filled in the details by computing the tax as provision for current tax in Column 54 at Rs. 49,58,000/- by applying lower rate of tax meaning thereby, the petitioner has exercised option merely because in absence of any provision for exercising the option in Column (e) as per the Circular No. 19/2023, the petitioner cannot be deprived of lower rate of tax and the delay in filing Form 10-IC ought to have been condoned by respondent No. 2 so as to fulfill the condition prescribed in sub-section (5) of section 115BAA of the Act read with section 21AE of the Rules providing for procedure for filing Form 10-IC. The impugned order passed u/s 119 (3) (b) of the Act and intimation under section 143 (1) of the Act dated 13.11.2022 are hereby quashed and set aside and the mater is remanded back to the respondent No. 2 to pass appropriate order condoning delay in filing Form 10-IC by the petitioner for exercising the option of lower rate of tax under section 115BAA as per the return of income filed by the petitioner in Form of Return of Income i.e. ITR-6 so as to enable the AO or the Central Processing Center (CPC) to re-process the Return of Income filed by the petitioner applying provision of section 115BAA of the Act for lower rate of tax at 22% instead of regular rate of tax applicable to the domestic company. Such exercise shall be completed within twelve weeks from the date of receipt of copy of this order by the respondent No. 2.
-
2024 (9) TMI 215
Reopening of assessment - reasons to believe - unsecured loans receipts - HELD THAT:- It is not in dispute that the AO while passing the Assessment Order u/s 143 (3) of the Act has specifically called for the information of the unsecured loans. The assessee has furnished the requisite details pertaining to the unsecured loans. On perusal of the Assessment Order, more particularly ground of addition of bogus unsecured loans.' Merely because there is a difference between the amount of unsecured loans in the books of the account of the petitioner and the addition made by the AO in the original assessment, it cannot be said that the income has escaped assessment as the AO while framing the assessment has considered the entire issue during the course of the assessment. The reliance placed on the decision in case of Income Tax Officer versus Techspan India Private Limited and Another [ 2018 (4) TMI 1376 - SUPREME COURT] is also not applicable in the facts of the case as the issue of unsecured loans was considered by the AO during the course of regular assessment proceedings, more over, on perusal of the reasons recorded, it is clear that the contention raised by the learned advocate for the respondent is not found to be mentioned in the reasons recorded because as per the reasons recorded, entire amount of Rs. 11,87,79,500/- is presumed to be the income which has escaped the assessment. It is clear that there is a mere change of opinion on part of the respondent while issuing the impugned notice under Section 148 of the Act. Respondent could not have assumed the jurisdiction to issue the impugned notice under Section 148 of the Act. It is also pertinent to note that the addition made during the regular course of assessment was challenged before the Commissioner (Appeals) by the petitioner who has allowed the appeal of the assessee and therefore, the issue of unsecured loans based upon which the impugned notice is issued has already merged into the order of the appellate authority. Assessee appeal allowed.
-
2024 (9) TMI 214
Reopening of assessment u/s 147 - accrual of income/undisclosed income - amount paid by the petitioner for obtaining mining rights in the e-auctions - HELD THAT:- The aforementioned sum was not the revenue earned by the petitioner-assessee from the sale of iron ore and other non-ferrous metals which may have been mined or extracted but the bid amount which was submitted to the Department of Mines and Geology for the purposes of acquiring the right to mine. It becomes pertinent to note that despite the aforesaid aspect having been duly highlighted by the writ petitioner in its response to the original notice as well as in the present proceedings, the AO has continued to take the wholly untenable stand that INR 6,81,90,364/- constitutes income, the source of which is liable to be examined and reassessed. As we peruse the contents of the reasons for reopening and which form a part of our digital record, it is manifest that the entire assumption of jurisdiction is based on a wholly erroneous view of the aforesaid amount constituting the income of the assessee. Regard must be had to the fact that the Department of Mines and Geology had merely provided to the AO the total amount paid by the petitioner for obtaining mining rights in the e-auctions which were conducted. The said amount clearly cannot be countenanced to be the income of the assessee for the relevant A.Y. The income of the assessee would only be that which was garnered from the sale of iron ore and other non-ferrous metals. The fact of INR 167,75,60,000/- representing the amounts paid by the petitioner for earning mining rights alone could not be disputed by Mr. Chandra, learned counsel appearing for the respondents. Notice u/s 148 set aside - Decided in favour of assessee.
-
2024 (9) TMI 213
Revision u/s 263 - PCIT has revised the assessment-order passed by AO u/s 153C for the sole reason that the AO has not examined the claim of excess interest of 3% paid by assessee on loans taken in comparison to the interest received on loans given. HELD THAT:- This premise taken by Ld. PCIT is not based on any incriminating material having been found in the search and transmitted to AO by the search-authorities. Undisputedly, the AY 2014-15 was a completed/ unabated year since no assessment relating to that year was pending as on the date of search and therefore the AO could examine only the incriminating material relating to assessee found during search and transmitted to him by search-authorities. AO had no jurisdiction to make any addition or disallowance de hors incriminating material. This is a settled proposition for assessment to be made u/s 153A/153C as per landmark judgement of Hon ble apex court in PCIT Vs. Abhishar Buildwell Pvt. Ltd [ 2023 (4) TMI 1056 - SUPREME COURT] The facts of case shows that the PCIT has revised AO s order for the issue of disallowance of excessive interest paid by assessee on loans taken in comparison to the interest received on loans given. The issue raised by PCIT does not emanate from any of the incriminating material in possession of AO and therefore the AO did not have any jurisdiction or authority to enter into the issue raised by PCIT. When it is so, the PCIT is apparently wrong in revising AO s order and directing the AO to reframe assessment for such an issue. PCIT has directed the AO to do something which is not within the domain, jurisdiction or authority of AO while framing assessment u/s 153C. Faced with this situation, we straightaway hold that the impugned revision-order passed by PCIT is not a valid order. Assessee appeal allowed.
-
2024 (9) TMI 212
Exemption u/s 11 - activities of assessee as hit by proviso to Sec.2(15) or not? - assessee is an organization registered under the Societies Registration Act, 1860 and is also registered u/s 12A, an apex sports body in India representing the country and is a member of International Olympic Association. HELD THAT:- We are of the considered view that there is apparent error in the perception of comparing the activities of BCCI and that of the present assessee. The working model of BCCI cannot at all be equated with the present assessee which is representing the country under the aegis of the Government in amateur international sports events. CIT(A) has specifically observed on facts of the case that in regard to participation in Rio Olympics games in 2016 the expenditure incurred is more than the sponsorship amounts received. The sponsorship agreements are not long-term contracts and there was no bidding process. Arranging these sponsorship contracts is in itself a great task for the assessee as the sponsors are paying out of their profits for motivating the assessee and the sportspersons of the country in participating in international events. Neither the sponsor nor the assessee can be attributed any profit motive from the outcome of these sponsorship agreements. No error in the findings of the ld.CIT(A) and there was no requirement of setting aside the matter to the file of the AO. The judgement of the Hon ble Supreme Court in the case of ACIT vs. Ahmedabad Urban Development Authority [ 2022 (10) TMI 948 - SUPREME COURT ] was, thus, not applicable to the assessee. Decided against revenue.
-
2024 (9) TMI 211
Penalty u/s. 270A - disallowing 30% of indexed cost of development expenses with reference to LTCG offered by the assessee as failed to furnish certain evidences in support of the expenditure claimed - HELD THAT:- The assessee has submitted all the details before the AO and also explained the reason for not furnishing few vouchers since it was misplaced and could not be furnished at the time of assessment proceedings and was willing to produce the same. AO went ahead and levied penalty u/s. 270A of the Act. Thus, it is noted that the A.O on estimated basis, disallowed an amount and levied penalty u/s. 270A. This impugned action of A.O levying penalty cannot be countenanced. We taking note of the explanation of the assessee is satisfied that the explanation given by the assessee during penalty proceedings is bonafide and find that the assessee has disclosed all the material facts to substantiate the explanation offered and therefore, as per sub clause (a) of sub section (6) of section 270A of the Act, we are of the view that this is not a fit case for levy of penalty for underreporting of income and moreover the disallowance of 30% of the expenditure in the quantum order was purely on estimation. Therefore, the penalty made by the A.O and confirmed by the Ld. CIT(A) is directed to be deleted. Appeal of the assessee is allowed.
-
2024 (9) TMI 210
Revision u/s 263 - Validity of assessment orders passed under section 153A with prior approval u/s 153D - Addition u/s 40A(3) regarding payments exceeding specified limits - HELD THAT:- We find that in the impugned order the ld. PCIT has not taken account of the fact that the assessments were completed after prior approval of the competent authority. Thus, we are of the considered view that at the time of examining the issue as to if the assessment order is erroneous so far as prejudicial to the interest of the Revenue, the ld. revisional authority is not only supposed to see the assessment record of AO, but also the record of the approval which as far as the revisional authority is concerned becomes record of the quasi judicial authority whose order is being examined by invoking the revisional jurisdiction. Therefore, without giving a finding that the prior approval u/s 153D was vitiated and was also erroneous so far as prejudicial to the interest of the Revenue, the assessment order independently cannot be held to be erroneous so far as prejudicial to the interest of the Revenue. Thus, order passed by the PCIT is unsustainable due to lack of jurisdiction in invoking section 263 of the Act for the reason that the same was passed upon taking prior approval u/s 153A of the Act, was not challenged by the Department before the Hon ble High Court or the Hon ble Supreme Court. Assessee appeal allowed.
-
2024 (9) TMI 209
Addition u/s. 68 - Cash deposits in bank account - HELD THAT:- As noted during assessment proceedings the assessee gave explanation to the AO regarding the nature source of cash deposits i.e. he was a contractor, but before the Ld.CIT(A) he changed his version and came out with collection of money from members of the Parish for allotment of house by Housing Board and that he has returned the sum taken from them after complaints were lodged against him and has filed certain evidence in this behalf which we note the AO had no occasion to examine. Therefore, for the ends of justice and fair play, we are inclined to set aside the impugned order of the CIT(A) and restore the assessment back to the file of the AO for de novo assessment. Appeal filed by the assessee is allowed for statistical purposes.
-
2024 (9) TMI 208
Disallowance of claim of deduction u/s 80P(2)(d) - Interest received from Co-operative Banks - delay in filing of return - HELD THAT:- AR has explained that there was no delay in filing of return, as the due date for the assessee was 30.09.2014, in view of the fact that accounts were required to be audited as per the provisions of Maharashtra Co-operative Societies Act, 1960. As such there was no delay in filing of return by the assessee as wrongly presumed by the CPC. No adjustment on debatable issue, such as claim of deduction u/s 80P(2)(d) is permissible while processing the return u/s 143(1) of the Act. Further, the delay in filing of appeal was due to the bonafide belief that the intimation u/s 143(1) would be rectified u/s 154 by the AO. Due to delay in disposal of assessee s rectification application, an appeal was also filed by way of abundant caution. The delay in filing of appeal was duly explained through an affidavit filed before the Addl. CIT(A). We hereby allow the appeal of the assessee. AO is directed to delete the disallowance of claim of deduction u/s 80P(2)(d).
-
2024 (9) TMI 207
Revision u/s 263 - AO had not assessed the assessee s alleged suppressed professional receipts declared as additional income, during the course of survey u/s 115BBE HELD THAT:- We wish to make it clear that there is hardly any dispute between the parties about the fact that this assessee is an Orthopaedic hospital providing maternity and other similar facilities. That being the case, we are of the considered view that the Rule 6F(3)(i) stipulates that such a person carrying out specified profession(s) i.e. medical herein is supposed to maintain a daily case register in Form No.3C prescribing the relevant particulars including the patients names, nature of services rendered, fees received and data of receipt etc. We find that the assessee s instant case file nowhere indicates compliance thereof which could take us to the conclusion that its impugned additional income has been derived from regular business activities only. Once the AO had not carried out his detailed enquiry(ies) to this clinching fact for the purpose of assessing the assessee s additional/surrendered income during survey; the same renders his assessment dated 22.09.2021 as an erroneous one causing prejudicial to interest of the Revenue. PCIT has rightly assumed his section 263 revision s jurisdiction in light of Malabar Industrial Co. Ltd [ 2000 (2) TMI 10 - SUPREME COURT] in these facts and circumstances. We thus uphold the learned PCIT s revision direction in very terms. Assessee appeal dismissed.
-
2024 (9) TMI 206
Characterization of the loss - Treatment to brought forward loss as business loss or capital loss - CIT(A) has considered the said amount as brought forward business loss whereas, the assessee is claiming the same to be brought forward capital loss - HELD THAT:- If the claim of the assessee is correct, then assessee is eligible for set off of the brought forward loss against the current years capital gain as per the provisions of section 74 of the Act. We restore this issue back to the file of the AO for verification whether the brought forward loss is in the nature of brought forward capital loss and if so then claim of the assessee shall be allowed in accordance with law. The ground of the appeal of the assessee is allowed for statistical purposes.
-
2024 (9) TMI 205
Deemed dividend u/s. 2(22)(e) - AO noticed that the assessee is holding more than 10% of the voting rights in all the above said three companies - HELD THAT:- The transactions mentioned above may not be in the nature of loans or advances falling within the scope of section 2(22)(e) - A definite view could be taken only if the relevant documents are examined. Since the assessee has not furnished relevant documents before the tax authorities, we are of the view that, in the interest of natural justice, the assessee may be provided with one more opportunity to present the documents. Accordingly, we set aside the order passed by the CIT(A) on this issue and restore the same to his for adjudicating the same afresh, by duly considering the evidences that may be furnished by the assessee. Addition made u/s 14A r.w.r. 8D - assessee submitted that it did not incur any expenses in earning the exempt income - AO did not accept the same - HELD THAT:- Assessee is having own funds exceeding the value of investments. Hence, as per the decision rendered in the case of HDFC Bank Ltd. [ 2016 (3) TMI 755 - BOMBAY HIGH COURT ] AO could not have disallowed interest expenses - we are of the view that this issue also requires fresh examination at the end of Ld CIT(A). Accordingly, we set aside the order passed by him on this issue and restore the same to his file for adjudicating it afresh, after considering the information and explanations that may be furnished by the assessee.
-
2024 (9) TMI 204
Non granting interest u/s 244A - delay in filing the revised return by the assessee - HELD THAT:- No delay was attributable on the part of the assessee after filing of its revised return on 16.10.2017. The delay, if any, was on the part of the CPC and the Jurisdictional AO in not giving credit to advance tax and TDS of the assessee to Torrent Power Ltd. It is also relevant to consider that due to non-credit of advance tax and TDS in the case of Torrent Power Ltd., demand was raised in the case of Torrent Power Limited, which was liable for payment along with the interest. Thus, when the Revenue is collecting the demand along with the interest due to non-credit of advance tax and TDS of the assessee in the hands of TPL and denying interest u/s. 244A of the Act to the assessee is highly arbitrary. Revenue is equally liable to pay interest on the amount of refund being issued to the assessee. Accordingly, the Revenue is directed to grant interest u/s. 244A of the Act to the assessee from the date of filing of the revised return till the date of issue of refund. Appeal preferred by the assessee is allowed.
-
2024 (9) TMI 203
Denial of deduction u/s 80P - return of income was not filed within the due date prescribed u/s. 139(1) - assessee submitted that it is a belated return of income which is filed beyond the due date prescribed u/s 139(1) - HELD THAT:- The assessee did not filed return of income on or before the due date as prescribed u/s 139(1), and it is only in the return of income filed in pursuance to notice u/s 148 which is filed beyond the due date prescribed u/s 139(1), the assessee filed said claim of deduction u/s 80P, which clearly is not admissible keeping in view substituted provisions of Section 80AC effective from assessment year 2018-19. The language of amended section 80AC is plain, clear and unambiguous, and literal reading of Section 80AC make it very clear that claim of deduction u/s 80P is admissible only when the claim of deduction u/s 80P is made in the return of income filed on or before the due date prescribed u/s 139(1). Thus, we do not find any merit in the appeal filed by the assessee. The decision relied upon by the assessee either concerns its self with pre-amended Section 80AC or concerns itself with adjustment made u/s 143(1)(a) while processing of the return wherein disallowance u/s 80P was made. We are not presently concerned with these disallowances. As have observed that CBDT in exercise of its power 119(2)(b) of the 1961 Act has issued Circular No.13/2023 dated 26.07.2023 in F.No. 173/21/2023-ITA-1, to deal with the cases where deduction u/s 80P could not be granted owing to return of income being filed beyond the due date specified u/s 139(1), and its condonation by merits by the Competent Authority as specified in the aforesaid Circular. Assessee, if may so advised, can file such application for condoning of the delay before Competent Authority as prescribed under the aforesaid circular, which shall be disposed off by the Competent Authority on merit in accordance with law. The Competent Authority while disposing such application for condoning the delay shall consider that the assessee was pursuing alternate remedy with appellate forums viz. ld. CIT(A) and ITAT. Thus, the appeal of the assessee stand dismissed.
-
2024 (9) TMI 202
Addition u/s 68 - cash deposits during the demonetization period - AO has made additions towards cash deposit in specified bank notes after demonetization period only for the reason that the assessee is not eligible to transact or receive any specified bank notes after demonetization as per notification/GO issued by RBI and Government of India - HELD THAT:- AO never disputed fact that the assessee has made sales in cash before demonetization period and also realized cash from debtors against cash sales made before demonetization period. AO erred in making additions towards cash deposits during demonetization period u/s 68 - CIT(A) also failed to look into the consistent transaction as in past, cash sales and source of cash deposits etc. Thus, we set aside the impugned order of the ld.CIT(A) and direct the AO to delete addition made towards cash deposits u/s 68 of the Act. Appeal filed by the assessee is allowed.
-
2024 (9) TMI 201
Revision u/s 263 - Error computing capital gain - certain discrepancies found relating to cost of improvement where the bills were issued after the date of sale deed, the AO has not followed the provisions of Section 50C - HELD THAT:- We observed that no doubt the AO has passed cryptic and non-speaking order. However, the AO has enquired the relevant information relating to indexed cost of acquisition, indexed cost of improvement during the assessment proceedings. The issues raised by learned PCIT in show case notice issued u/s 263 of the Act was properly enquired by the AO in original proceedings accepting the submission of the assessee. After verification while passing order giving effect u/s 263 of the Act, the AO has verified the issues raised by ld. PCIT and proceeded on the other issue raised by the learned PCIT on cost of second improvement, this was not the issue raised in show cause notice. Once a query is raised during the assessment proceedings and the assessee has replied to it, it follows that the query raised was a subject of consideration of the A.O. while completing the assessment and it is not necessary that an assessment order should contain reference and/or discussion to disclose its satisfaction in respect of the query raised. See ARONI COMMERCIALS LTD. VERSUS THE ASSISTANT COMMISSIONER OF INCOME TAX AND ANOTHER [ 2014 (8) TMI 390 - BOMBAY HIGH COURT] Thus we are inclined to accept the ground raised by the assessee that AO has made proper enquiry in the original assessment proceedings even though it is non-speaking order. Accordingly, grounds filed by the assessee are allowed.
-
2024 (9) TMI 200
Revision u/s 263 - Determination of income in the case of non-residents - According to CIT, the income computed by the AO is erroneous and prejudicial to the interest of the revenue since Section 44B is a substantial provision which clearly lays down the manner in which the income of the non-resident in establishing business has to be ascertained and income in the present case has been under assessed - HELD THAT:- Whichever provision is beneficial to the assessee has to be applied. After establishing business connection, which has not been disputed by the assessee, the AO applied the beneficial provisions basis Article 7 of the India-UAE DTAA. Since the AO has taken a very plausible view supported by the relevant provisions of the Act and Rules, we failed to persuade ourselves to accept that the impugned assessment order is erroneous and prejudicial to the interest of the revenue. It is a settled position of law that powers u/s 263 of the Act can be exercised by the Commissioner on satisfaction of twin conditions, i.e., the assessment order should be erroneous and prejudicial to the interest of the Revenue. By 'erroneous' is meant contrary to law. Thus, this power cannot be exercised unless the Commissioner is able to establish that the order of the AO is erroneous and prejudicial to the interest of the Revenue. Thus, where there are two possible views and the AO has taken one of the possible views, no action to exercise powers of revision can arise, nor can revisional power be exercised for directing a fuller enquiry to find out if the view taken is erroneous. This power of revision can be exercised only where no enquiry, as required under the law, is done. It is not open to enquire in case of inadequate inquiry. Our view is fortified by the decision of Nirav Modi [ 2016 (6) TMI 1004 - BOMBAY HIGH COURT] No error or infirmity in the assessment order which could make it erroneous to the interest of the revenue. Therefore, we set aside the order of the CIT(IT) and restore that of the AOframed u/s 143(3) r.w.s. 144C - Appeal of the assessee is allowed.
-
2024 (9) TMI 199
Disallowance of deduction u/s. 80P(2)(d) - interest income earned from a co-operative bank - ITO considering that the Co-operative Bank does not fall under the purview of Co-operative Society as referred to in Section 80P(2)(d) of the Act, added back the deduction taken - HELD THAT:- The same issue has been decided recently in Shah and Nahar Industrial Premises A2 Co-op. Soc. Ltd [ 2024 (6) TMI 1390 - ITAT MUMBAI] wherein as noticed that the assessee has placed the surplus funds in deposits with various Co-operative Banks and has received interest income on the same. The assessee while filing the return of income has claimed such interest as a deduction under section 80P(2)(d). We notice that the lower authorities have denied the benefit of deduction for all the AYs under consideration for the reason that the interest received from Co-operative Bank is not eligible for deduction under section 80P(2)(d). - we hold that the assessee is entitled for deduction under section 80P(2)(d) towards income derived from deposits with Co-operative Bank for AY 2017-18, 2018-19 2020-21. Accordingly, the AO is directed to allow the deduction claimed by the assessee for these AYs It is evident from the facts that in the F.Y. 2012-13 relevant A.Y. 2013-14, the assessee earned interest income of Rs. 18,12,581/-. Whole of this interest is earned from the savings and fixed deposit maintained with the cooperative bank i.e., The Mumbai District Central Co-operative Bank NKGSB Co-operative Bank. The assessee claimed the interest amount as deduction u/s. 80P(2)(d) of the Act but the same was not allowed by the lower authorities i.e., an Income Tax Officer u/s. 143(3) of the Act and in appeal by the Ld. CIT(A) u/s. 250 of the Act vide impugned order. For the above reasons, we therefore order that the assessee is entitled for deduction u/s. 80P(2)(d) of the Act towards the income received from deposit with Co-operative Bank. Assessee appeal allowed.
-
2024 (9) TMI 198
Addition as deemed Rental income - flats owned by assessee, these flats were allotted to assessee as a result of joint development agreement - CIT(A) deleted addition as there was no addition made in the case of other two co-owners of the same property for the same assessment year - HELD THAT:- We observe that it is settled position of law as propounded in the case of Union of India v. Kaumudini Narayan Dalal [ 2000 (12) TMI 101 - SC ORDER] that the approach of the Revenue in respect of the assessees, who are party to same transaction should be uniform. It has been held by the Hon'ble Supreme Court that the Revenue cannot adopt the tactics of pick and choose while assessing the citizens of India, otherwise it would be violation of Article 14 of the Constitution of India. Therefore, we are of the view that the ld. CIT(A) is correct in deleting the addition of deemed rental income applying the rule of equality before law. Notwithstanding to this on merits also we observe that, whether deemed rental annual value is assessable in respect of the flats which were not acquired for self-occupation rather kept as investment for sale, we find tha in the case of Sachin R Tendulkar [ 2018 (8) TMI 847 - ITAT MUMBAI] has decided the issue in favour of assessee. Whether the gain arose to the assessee on sale of flats would be long term capital gain or short term capital gain - Undisputed facts are that assessee has acquired the land somewhere in 1960 and the rights in flats, allotted to assessee has been accrued on 15-12- 2010 and other was entered on 19.06.2013, when the Joint Development agreements were entered into by the assessee. No material has been brought on record by the AO or by DR before us to refute these factual observations made by the NAFC. Further in AYs 2014-15 and 2015-16. The gain attributable to this land was earlier assessed by the department as long term capital gain. D.R. failed to point out any change in the facts and circumstances even this impugned year. Therefore, applying the principle of consistency as formulated in the case of Radhasoami Satsang [ 1991 (11) TMI 2 - SUPREME COURT] we are of the view that the CIT(A) is correct in allowing the appeal of the assessee. Taxability of income from alleged plant and machinery - We observe that there is no clear finding of the AO or CIT(A) on this issue as to what was the monthly rent and how much TDS was deducted by the payee because if we multiply 1,58,590/- by 12(1,58,590X12) then the amount would come Rs19,02,360/- and not 12,52,387/- as considered by the CIT(A). AO has to re-examine the issue a fresh. We made it clear that in case the payee has deducted TDS @ 10% and assessee would be able to reconcile the correct amount of rent with 26AS then certainly the income to be taxed as Income form House property and addition is required to be made. With this observation we deem it necessary to remit this issue to the file of AO for examination. We direct the AO that he will confine the fresh proceedings to this issue only.
-
2024 (9) TMI 197
Cancellation of registration u/s 12AB - Charitable activity or not? - invoking the provisions of Section 13(1)(b) for denying registration - religious-cum-charitable trust - CIT(E) observed that the object in the trust deed / instrument of creation of trust seems to be charitable in nature and appears to be restricted to the benefit of a particular religious community or caste or private religious community i.e, Jain community - HELD THAT:- It is clear from the objects of the assessee-trust that it was not for benefit of only Jain community. CIT(E) has considered only clause-(F) and not the other clauses for proper appreciation of the issue. The objects also include medical help to the needy patients (clause-G), educational, occupational and medical help (clause-E), welfare activities for upliftment of general public (clause-D) etc. Hence, rejection of registration based on only one clause is not proper. Very premise for the Commissioner to come to the conclusion that the objects of the trust were confined for the benefit of a religious community, is incorrect. Thereafter to suggest that the activities were carried out only for such purposes would be entering in the realm of granting exemptions in terms of Section 13 of the Ac, which would be the task of the AO to be undertaken at the time of assessment on the basis of material that may be brought on record. Since the facts of the present case are similar to the facts of the above case, following the reasons given in the above order, the matter is restored back to the file of CIT(E) for de novo consideration after giving adequate opportunity of hearing to the assessee - Appeal filed by the assessee is allowed for statistical purposes.
-
2024 (9) TMI 196
Denial of registration u/s 12A(1)(ac)(iii) - nature of charitable activities, are restricted to the benefit of a particular community or caste, that is, Gandhvi and their sub caste Mandhuda, Shakhra, Alsuwa and Nukh - provision of Section 13(1)(b) of the Act, would be applicable to the assessee-trust denying exemption/ registration - Whether the trust's objects are exclusively for a particular community or for the general public? HELD THAT:- We observe that in the case of Jamiatul Banaat Tankaria [ 2024 (3) TMI 376 - ITAT AHMEDABAD] ITAT held that where objects of assessee-trust were primarily charitable rather than favouring any specific religious community, CIT(E) was not justified in denying registration under Section 12A, by invoking Section 13(1)(b) of the Act, as said provisions would be attracted only at time of assessment and not at time of grant of registration. In the case of Malik Hasmullah Islamic Educational and Welfare Society [ 2012 (8) TMI 680 - ITAT, LUCKNOW] held that since provisions of Sections 11, 12 and 13 are intended for exercise of jurisdiction by an assessing officer (AO) in an assessment proceedings, the Commissioner (Exemption) is not competent to invoke such provisions for purpose of declining registration u/s 12A(1)(ac)(iii) of the Act. Therefore, we note that Section 13(1)(b) of the Act can be invoked only at the time of assessment and not at the time of registration u/s 12A(1)(ac)(iii) of the Act . We also note that when the assessee-trust under consideration, has large number of other objects, which are for benefit of general public, (apart from a few objects in the nature of religious), therefore registration should not be denied to the assessee-trust u/s 12A (1)(ac)(iii)of the Act, for that reliance is placed on the judgment of Bayath Kutchhi Oswal Jain Mahajan Trust [ 2016 (9) TMI 8 - GUJARAT HIGH COURT] Considering the above facts and circumstances, we set aside the order of Ld. CIT(E) and remit the matter back to the file of Ld. CIT(E), with the direction to grant the registration to the assessee-trust in accordance with law. For statistical purposes, the appeal of the assessee is allowed.
-
2024 (9) TMI 195
Addition u/s 56(2)(viib) - as pleaded that additional evidences submitted before the ld. CIT (A) are very crucial and ought to have been admitted and duly considered - HELD THAT:- We have carefully considered the submissions and issues. In the substantial interest of justice and in our considered opinion, additional evidences need to be admitted. Hence, we direct that these additional evidences are admitted and the matter is remitted to the file of AO. AO is directed to consider the additional evidences and after duly considering the same, he should pass appropriate order. Assessee should be given adequate opportunity of being heard. Appeal of the assessee is allowed for statistical purposes.
-
2024 (9) TMI 194
Cancelling the registration u/s.12AB(1)(b)(ii)(B) - Considering the amendment of the Trust deed as change of objects - amended trust deed, which had not been intimated to the department within 30 days from the date of amendment - HELD THAT:- On perusal of both original and amended Trust deed of the Trust, it is observed that the assessee s objects in original trust deed were sufficiently wide and covered range of charitable activities and only minor changes were made in the amended deed, without affecting the substance and spirit of the original deed. Therefore, there is no need for the assessee trust to file an application for re-registration, on account of such amendment made in the objects and hence we do not countenance the action of the ld. CIT (E) in rejecting the registration application of the assessee. CIT(E) has erred in his decision by cancelling the registration without finding any deviation in the trust activities or whispering any comment on the genuineness of the activities of the trust, as required in the provisions of section 12AB(1)(b) Considering the facts and circumstances of the case and the assessee s reliance on the decision of CIT(E) Vs. Paramount charity Trust, [ 2019 (4) TMI 379 - SC ORDER] wherein it is clearly held that Non communication of the amendment in the trust deed was a mere irregularity and would not be a ground for cancellation of registration already granted , we are quashing the impugned order of the ld. CIT(E) and allow the appeal of the assessee by directing the ld. CIT(E) to grant the registration to the trust.
-
2024 (9) TMI 193
Addition on account of notional interest on the alleged bank account with HSBC Bank Account in Geneva - HELD THAT:- The said seized document nowhere mentions the name of the assessee or his wife and it only mentions the name of Shri Praveen Sawhney(son of assessee). Considering the aforesaid orders passed in the case of the assessee and also considering the fact that the lower authorities had placed reliance on the orders passed by them for earlier years while making the addition towards notional interest income which stood deleted by the Tribunal vide its order [ 2021 (6) TMI 99 - ITAT DELHI] we hold that there cannot be any addition towards notional interest income that can be made in the hands of the assessee for year under consideration also. Accordingly, the grounds raised by the assessee are allowed.
-
2024 (9) TMI 192
Exemption claim u/s 10(46) - substantive conditions required to claim exemption - notified authority - HELD THAT:- Assessee has not been a notified authority u/sec.10(46)(c) of the Act which forms the precise reason for the AO as well as the NFAC to decline the same. The very factual position has continued before us as well. The assessee has also filed it s writ petition(s) before the hon ble jurisdictional high court and the same is yet to be decided. We note that this tribunal is nowhere a party in the said proceedings pending before their lordships. Nor there is any stay order against us in both these appeals. Faced with this situation, we hardly see any reason to disturb the learned lower authorities findings declining the assessee s sec. 10(46) exemption claim for want of it s statutory notification.
-
Customs
-
2024 (9) TMI 191
Rejection of the amendment under Section 149 of the Customs Act, 1962 - rejection of amendment on the ground that when the bills of entry were filed Explanation to Rule 96(10) of CGST Rules was already inserted vide N/N.16/2020 Central Tax dated 23.03.2020 and the appellant could have exercised the option either to pay or not to pay any of the duties - whether the appellant is entitle to seek the amendment of the BEs under Section 149 of the Customs Act? - HELD THAT:- From the impugned order, it is evident that the appellant in their submissions have contended that DRI vide their letter, 20.11.2020 in other cases requested to the Adjudicating Authority to consider the appeals of all importers, who are willing to pay such IGST along with interest, however, as observed by the Commissioner, (Appeals) the said letter was not submitted by the appellant. It is, therefore, directed that both the appellant and the Revenue may place on record the particulars of all the cases, where amendment has been allowed in similar circumstances so as to enable the Adjudicating Authority to arrive at a consistent and uniform conclusion. The impugned order is hereby set aside - The appeal is, accordingly allowed by way of remand.
-
2024 (9) TMI 190
Valuation of imported goods - inclusion of Licence Fee and Management Fee in the assessable value of the goods imported from related parties - Inclusion of Management Fee in the assessable value of imported goods. Valuation of imported goods - inclusion of Licence Fee and Management Fee in the assessable value of the goods imported from related parties - HELD THAT:- From the provisions of Rule 10(1)(c) of the Valuation Rules royalties and licence fees related to the imported goods that the buyer is required to pay, directly or indirectly, as a condition of the sale of the goods, to the extent that such royalties and fees are not included in the price actually paid or payable, does constitute a component of the transaction value. It can thus be said that royalties and licence fees, necessarily required to be added to transaction value has to be relatable to the imported goods alone and should be necessarily a condition precedent for sale of the goods. From the agreement provisions reproduced, it can be noted that the said licence fee payments are not anywhere related to imported goods and are neither stated to be as a condition of the sale of the said goods. The trade mark licence fee is required to be paid for affixing the trade mark on the goods manufactured by the appellant - The appellant has pointed out that in terms of the trade mark affixation, the licence fee is required to be paid and has been paid for the affixation of the words and marks/label of Carl Schenck AG on their finished goods. This payment is neither related to the import of goods nor is prescribed to be paid as a condition of sale of the imported goods. Thus, the licence fees paid by the appellant not being related to imported goods cannot be added to the transaction value fo the imported goods. The appellant also placed reliance on the Interpretative Notes to Rule 10 of the Customs Valuation Rule 2007, to point out that even if the royalty is based partially on the imported goods and partially on other non-related factors, it would be inappropriate to make out a case for addition of royalty - if the royalty paid is solely based on the imported goods and as a condition precedent to the sale of imported goods, then alone can it be added to the price actually paid or payable. Inclusion of Management Fee in the assessable value of imported goods - HELD THAT:- The Management Fees paid by the appellant served as a mechanism for reimbursement of costs of various administrative services received from the group companies which in itself are defined in the said agreement - These services are in the nature of Management Services and cannot be held to be related to importation of goods. They rather represent fees for the Management Services rendered to the group companies as a continuous process and are not contingent upon the importation of the goods from the group company. The appellant has also submitted that even in the absence of such imports, the group companies are still mandated for the payment of aforementioned fees for the Management Services received by the appellant. It may also be appropriate to refer to the decision of the Larger Bench of the Tribunal in the case of Panalfa Dongwon India Ltd. v. Commissioner of Customs, Mumbai [ 2003 (6) TMI 30 - CEGAT, NEW DELHI] , wherein it was clarified that royalty payable is required to be necessarily in connection with the import of the goods and that related to downstream production/training etc. being nowhere related to imported goods were not required to be a part of the transaction value. Thus, the payment of Management Fee and the License Fee not being relatable to the imported goods and condition precedent to the sale of imported goods are therefore not includible in the transaction value - the impugned order set aside - appeal allowed.
-
2024 (9) TMI 189
Classification of imported goods - import of electrical components viz, capacitors, ICs, Bare PCBs, LED, Fuse, Relay, etc. - Department is of the view that these un-mounted PCBs or circuit layouts, (commonly known) are specific items and deserve to be classified in Chapter Heading 84159000 of the Customs Tariff Act, 1975 - HELD THAT:- The two items i.e. Buzzer and LED were in any case are being classified under Tariff Heading 84159000 and other items were classified under Chapter 85 of CTA by the party excepting silicone keypad, Zebra/Keypad and springs which were classified under Tariff Heading, 39269099, 40169990, 73209090 respectively. The classification as done by the appellant in respect of item at Sr. No. 1-15 of table in factual matrix Capacitors, Resistor, Bare PCB, Fuse, Relay, Connecting Terminals, Rectifiers, Transistor, Mosfet, IRED, LED Backlight, Crystal, Integrated Circuit / Micro IC, Line Cord and Switching Power Supply Transformer upheld; Silicone Key Pad, Buzzer and LCD will be classified under Tariff Heading 84159000, item at Sr. No. 17 Zebra/Keypad under Tariff Heading 40169990 and item at Sr. No. 18 i.e. Spring under Tariff Heading 73209090. Appeal disposed off.
-
2024 (9) TMI 188
Classification of imported goods - Vitamin AD3 (1000:200) IU/G (Feed grade/Feed additive) - to be classified under CTH 2309 as 'Preparations of a kind used in animal feed or under CTH 2936? - demand of interest - levy of penalty - HELD THAT:- In the case of M/s Thermax Ltd Vs Commissioner of Central Excise, Pune [ 2022 (10) TMI 468 - SUPREME COURT] , the Supreme Court has reiterated the view that the HSN code is the bedrock of custom controls and procedures. It has also been held that as per the HSN, classification is done by placing the goods under the most apt and fitting sub-heading. Accordingly, the impugned product is appropriately classifiable under CTH 2936. It is also noted that the chemical composition of the impugned goods is synthetic and the product is not derived out of processing of vegetable or animal material, in order to render its classification in Chapter 23. Further, it is seen that they serve a specific purpose as feed additives, which is also consistent with the goods described under CTH 29362100. Further, the presence of stabilizers, antioxidants, or solvents does not alter the vitamins' character but ensures their preservation and efficacy as feed additives, which is in line with the guidelines that additives should not exceed the quantity required for preservation or transport and should not alter the essential character of the vitamins. In the instant case, it is seen that as per the Material Safety Data Sheets (MSDS) of its supplier Xiamen Kingdom way Vitamins Ltd clearly establishes that the impugned goods contain Vitamins to the tune of 53.2% and the remaining elements are various carriers, stabilizers, etc. In view of the above factual position, there are no reason to differ from the impugned order with regard to the classification of Vitamin AD3 in Chapter 2936. Demand of interest - HELD THAT:- It is noted that once the exigibility to tax is established, interest is payable, as per the statutory provision - in the case of Pratibha Processors v. Union of India [ 1996 (10) TMI 88 - SUPREME COURT] the Supreme Court held that Interest is compensatory in character and is imposed on an assessee who has withheld payment of any tax as and when it is due and payable . Accordingly, as the differential duty demand is upheld, the demand of interest in the impugned order is correct. Levy of penalty - HELD THAT:- As there were several contrary decisions with regard to the classification of the said product Vitamin AD3 during the relevant time, there was confusion amongst the importers. Consequently, the imposition of penalty in not warranted in the instant case. The classification of Vitamin AD3 under CTH 2936 upheld - the demand along with interest confirmed in the impugned order upheld - the penalty imposed on the appellant set aside - appeal allowed in part.
-
2024 (9) TMI 187
Classification of imported goods - classifiable under Chapter Heading 2710 1990, as Other as declared by the importer or under Chapter Heading 2710 1290 as Light oils and preparations, as claimed by the Revenue - correctness in setting aside the order of re-export and in allowing the goods to be cleared for home consumption - imposition of penalty for violation of the provisions of the Petroleum Act, 2002. Whether the goods imported are appropriately classifiable under Chapter Heading 2710 1990, as 'Other' as declared by the importer or under Chapter Heading 2710 1290 as Light oils and preparations , as claimed by the Revenue? - HELD THAT:- It is apparent that the petroleum products which get distilled by 90% or more by volume at 210 C are light oils and preparations' for the purpose of Chapter 27 sub-heading 2710 12. The tests are to be conducted as per the Methods prescribed in the Note 4. It is observe that none of the reports have specified exactly what percentage of the goods are distilled at 210 degrees, for meeting the requirements as specified under Chapter Note 4 of Chapter 27. The IOCL report specifies 90% distillation at 204 degree and the CRCL, New Delhi report says that more than 90% distilled at 210 degree. However, the method of testing was not declared in CRCL New Delhi report. We observe that the goods being volatile in nature, the quality of the samples deteriorate over a period of time. The test report received from the sample drawn immediately after import will display the correct features than the test conducted on the sample drawn earlier and tested after 12 months. The CRCL, Delhi report is not a reliable report as it is based on the samples which were drawn 12 months before. The report received from CRCL, Kolkata will have the correct features as this test was done on the samples drawn immediately after import of the goods. The test report received from CRCL, Kolkata categorically states that the samples do not meet the criteria of light oil and its preparations. It is found that the adjudicating authority has not given any valid reason to reject this report. The Ld. Commissionr (Appeals) has given a categorical finding and classified the impugned goods under the chapter heading 27101990. The reasoning given by Ld. Commissioner (Appeals) to arrive at the classification is more appropriate and there are no reason to interfere with the same. Accordingly, the classification of the goods approved in the impugned order is upheld and it is held that the goods imported are appropriately classifiable under Chapter Heading 2710 1990 as declared by the importer. Whether the impugned order is correct in setting aside the order of re-export and in allowing the goods to be cleared for home consumption? - Whether the Appellant-importer is liable for imposition of penalty for violation of the provisions of the Petroleum Act, 2002? - HELD THAT:- Under section 3 of the Foreign Trade (Development and Regulation) Rules, the provisions are to be made for prohibiting, restricting or otherwise regulating. Since the original authority allowed for re-export and appellate authority allowed for home consumption, the goods were not prohibited goods. Once the goods are allowed for clearance for home consumption, the same could not be confiscated under 111(d) and so penalty was also not imposable. Further, we observe that the Appellant-importer had PESO license to import Petroleum Class A and for storage of the goods and PESO doesn t approve all the drums. Thus, the submission of the Appellant-importer agreed upon that the violation, if any, is only procedural in nature, which has also been rectified latter by getting the permission for import of 'Other than bulk' also. It is a settled law that the substantial benefit cannot be denied for procedural violations. There is no violation of the provisions of Petroleum Act, 2002 in this case - the goods are not liable for confiscation and hence, the redemption fine imposed in the impugned order for allowing clearance of the goods for home consumption is not sustainable - there is no violation of Petroleum Act, the order of the Ld. Commissioner (Appeals) in allowing the goods for clearance to home consumption upheld - no penalty imposable on the Appellant-importer under section 112(a)(i) of the Customs Act, 1962 and hence the penalty set aside - there is no merit in the appeal filed by Revenue and hence the same is liable for rejection. The appeal filed by the Appellant-importer is allowed.
-
2024 (9) TMI 186
Classification of imported goods - SCRIPTANE PW 28/32H (Petroleum Hydro-treated Middle) - to be classified under CTH 2709 or not - benefit under Serial No. 487 of Notification No. 21/2002-Cus. dated 01.03.2002 - suppression of facts or not - Extended period of limitation - HELD THAT:- In respect of the 17 Bills-of-Entry filed by the appellant during the period from February 2010 to September 2010, it is observed that the Bills of entry were assessed finally classifying the goods under Chapter Heading 2709. It is observed that the Department did not raise any doubt about the classification of the goods in respect of these 17 Bills-of-Entry when the goods were assessed finally. These final assessments were not challenged by the department and hence the assessment attained finality. The department cannot re-open the classification of the goods imported vide these 17 Bills of Entry later by invoking suppression clause. The appellant has not suppressed any information from the department when the goods were imported under these 17 Bills of entry and all the relevant facts were well within the knowledge of the Department. Thus, there is no suppression of facts with intention to evade payment of tax established in this case and hence, the Show Cause Notice issued on 26.12.2013 by invoking the extended period of limitation is not sustainable. The re-classification of the imported goods vide the 17 Bills of entry under CTH 2710, on the basis of Test Report received from IIT, Kharagpur, is not sustainable. Accordingly, the demands confirmed in the impugned order in respect of all these 17 Bills of Entry set aside. Regarding classification of the goods imported vide the two Bills of Entry, the Appellant submits that proper classification of these goods is also under Chapter Heading 2709 - in the present case, the classification of the imported goods is to be done as per the Tariff Entries, Section Notes and Chapter Notes of the Customs Tariff Act, 1975. Classification of the goods mentioned by the supplier in the Invoice is not relevant for determining the classification of the goods imported into the country. In this case, since the goods imported are extracted from Crude, it appropriately fit into the description of the Tariff Entry 2709. Accordingly, the impugned goods imported by the Appellant vide the two Bills of Entry as mentioned in paragraph 2.1 supra, are appropriately classifiable under Chapter Heading 2709 and they are eligible for the benefit of exemption as per Sl. No. 487 of Notification No. 21/2002-Cus. dated 01.03.2002. The classification of the goods under CTH 2710 in the impugned order in respect of all the 19 Bills of Entry is not sustainable and accordingly, the demand of differential duty confirmed in the impugned order in respect of all the 19 Bills-of-Entry by re-classifying the impugned goods under CTH 2710 is set aside. Since the demand raised against the Appellant itself is set aside, the question of demanding interest and penalty does not arise. The impugned order set aside - appeal allowed.
-
2024 (9) TMI 185
Time limitation - suppression of facts or not - classification of imported spectrometers - to be classified under CTH 90221900 or not - applicability of N/N. 24/2005-Cus dated 01.03.2005. Time Limitation - HELD THAT:- There is no allegation of suppression of facts in the impugned orders. Appellant had made declaration as per the invoice/details provided by overseas supplier and there is no allegation of any fraud, collusion or willful misstatement or suppression of facts to invoke the extended period of limitation. Thus, the demand made against the goods imported against Bill of Entry No. 712110 dated 29.03.2008 by issuing a Show Cause Notice after 3(three) years and 9(nine) months and for the goods imported under the Bill of Entry No. 325535 dated 01.02.2010 by issuing SCN after 1(one) year and 10(ten) months is barred by limitation and impugned orders are unsustainable. Classification - HELD THAT:- The issue of classification of the impugned imported goods is not decided as the issue is considered on limitation, and it is found that the impugned order is unsustainable on limitation. Appeal allowed.
-
2024 (9) TMI 170
Enhancement of the value of imported goods by the Assessing Officer - rejection of declared value mentioned in Bills of Entry - whether after having themselves rejected the value mentioned in the Bills of Entry and after having also mentioned that the re-determined value under rule 9 of the 2007 Valuation Rules was acceptable to them, can the importers raise this issue in the appeals? - HELD THAT:- It is difficult to accept the contention of learned counsel for respondent that despite having accepted the enhanced value in very categorical terms in the letters, the importers can still challenge the enhancement of the value and contend that it has not been properly determined under the 2007 Valuation Rules. It is well settled that what is admitted is not required to be proved by the department. This issue has been settled by the Supreme Court in Systems Components [ 2004 (2) TMI 65 - SUPREME COURT ] where it was held that 'Once it is an admitted position by the party itself, that these are parts of a Chilling Plant and the concerned party does not even dispute that they have no independent use there is no need for the Department to prove the same. It is a basic and settled law that what is admitted need not be proved.' The order dated 05.04.2019 passed by the Commissioner (Appeals) allowing the 57 appeals deserves to be set aside and is set aside. All the 57 appeals filed by the department are, accordingly, allowed and the enhancement in the value of the imported goods by the Assessing Officer is maintained - Appeal of Revenue allowed.
-
Insolvency & Bankruptcy
-
2024 (9) TMI 184
Maintainability of petiiton - Resolution Plan stands approved upto the Supreme Court - personal insolvency proceedings have been initiated against the promoters/directors of the CD - COC failed to ensure compliance of Section 29A read with Section 5(24) of the IBC - HELD THAT:- It is significant to note that the Resolution Applicant made full and truthful disclosure of its background learned NCLAT at the time of submission of Resolution Plans and it was after a detailed analysis that the learned NCLT arrived at the conclusion that the Resolution Applicant was not falling foul of the bar of Section 29A of the IBC - the plea that the Resolution Applicant was a related party has no merits as nothing is brought on the record so as to show its nexus or connection with the activities of the CD . It is well ordained in corporate law that once the CIRP proceedings are initiated and Resolution Plans are approved, the adjudication of the claim of the creditors could only be in accordance with the IBC. Needless to state that the COC, once constituted in accordance with the IBC, acts on behalf of all the creditors and the taskof the COC is to attain a balance between the twin goals of the CIRP process viz., maximization of the value of the assets of the CD and also a planned course for revival of the CD. These being the twin objectives, the decisions take by the COC, which have been approved by the NCLT are considered to be commercially viable and cannot be condemned on any counts by the petitioner. The effect that a Resolution Plan once approved would bring is to proceed on a clean slate with the successful resolution applicantrather than carrying the cargo of such debts which need to be satisfied to the extent required and then jettisoned, as stated by the Supreme Court in the case of JAYPEE KENSINGTON BOULEVARD APARTMENTS WELFARE ASSOCIATION ORS. VERSUS NBCC (INDIA) LTD. ORS. [ 2021 (3) TMI 1143 - SUPREME COURT ]. There is no escape from the conclusion that once the Resolution Plan was approved, the assets of the CD in the hand of the Resolution Applicant stood shielded from the criminal prosecution and attachment. Section 32A of the IBC is merely clarificatory in nature. The petitioner has failed to make out a case for issuance of any prerogative writs by this Court. There is nothing as such to find any blemishes or flawed actions or inactions on the part of the respondent No.2 in any manner requiring interference by this Court. Hence, the present writ petition is dismissed with costs.
-
PMLA
-
2024 (9) TMI 183
Application for regular bail filed by applicant Gurupada Maji S/o Late Sh. Narayan Maji, through his pairokar under Sections 45 and 46 of Prevention of Money Laundering Act, 2002(PMLA) read with Section 439 Cr.P.C. - illegal excavation and theft of coal from leasehold area of Eastern Coalfield Limited (ECL) - Section 45 of PMLA - HELD THAT:- The Supreme Court in its landmark judgment in Vijay Madanlal Choudhary [ 2022 (7) TMI 1316 - SUPREME COURT ], upheld the Constitutional validity of Section 45 of PMLA, at the same time recognizing that though the provision restricts the right of the accused to grant of bail but the conditions do not impose an absolute restraint on the grant of bail and the discretion vests in the Court, which has to be exercised judiciously and not arbitrarily. The twin conditions in Section 45 of PMLA have been subject matter of extensive judicial scrutiny. PMLA is an enactment aimed at combating the menace of money laundering which has far reaching implications on the economic stability of the country. Gravity of economic offences and need for a differential approach in matters of bail was highlighted by the Supreme Court in Y.S. Jagan Mohan Reddy [ 2013 (5) TMI 896 - SUPREME COURT ], where the Supreme Court observed that economic offences constitute a class apart and need to be approached with a different perspective even while considering a bail application. The Supreme Court in Masroor v. State of Uttar Pradesh and Another, [ 2009 (4) TMI 1031 - SUPREME COURT ], observed that while deciding the bail application, Courts must strike a balance between the valuable right of liberty of an individual and the larger interest of the society. Article 21 of the Constitution of India has been interpreted expansively by the Supreme Court to encompass a panoply of rights including the right of an accused to speedy trial. Despite the stringent requirements under Section 45 of PMLA for grant of bail, the twin conditions therein do not create an absolute restraint or embargo or an insurmountable barrier in the way of the Court to grant bail on grounds of delay in completion of trial and long incarceration, which in this case is for a period of 27 months and 03 days. Maintaining a delicate balance between the twin conditions under Section 45 of PMLA and the need to combat economic offences and seeing with the prism of Article 21 of the Constitution of India, in my view, the applicant has made out a case for grant of bail keeping in view the incarceration of nearly 28 months and there being no possibility of the trial concluding in the near future. On the aspect of the applicant being a flight risk albeit there was no serious opposition, yet this apprehension of the prosecution can be allayed by imposing stringent bail conditions. It is to be noted that on being granted bail by the Special Court in the predicate offence, applicant complied with all the bail conditions and joined the investigation as and when called for. It is also a matter of record that the investigation in the present matter qua the applicant is complete. Case of the ED is primarily based on documentary evidence and the relevant records/documents have been seized and are in custody of investigating agencies and thus cannot be tampered. ED has not argued that there is any possibility of intimidating the witnesses. The application is allowed and it is directed that the applicant be released on regular bail, subject to his furnishing a personal bond in the sum of Rs.5,00,000/- with two sureties of the like amount to the satisfaction of the learned Trial Court and further subject to the fulfilment of conditions imposed - bail application allowed.
-
Service Tax
-
2024 (9) TMI 182
Levy of service tax - Business Auxiliary services or not - sale of Lotteries - constitutionality of the Explanation added to Section 65 (19) (ii) of the Finance Act, 1994 - HELD THAT:- On a reading of clause (19) of Section 65 of the Finance Act, 1994 and on analyzing the same, it is evident that tax on a business auxiliary service is relatable to (i) any service concerning promotion or marketing or sale of goods, produced or provided by, or belonging to the client and (ii) promotion or marketing of service provided by the client. The definition of goods has also been noted in clause (50) of Section 65 of the Finance Act, 1994 which refers to clause (7) of Section 2 of the Sale of Goods Act, 1930. The expression goods under the Sale of Goods Act expressly excludes actionable claims as well as money - This Court in Sunrise Associates [ 2006 (4) TMI 118 - SUPREME COURT ] has held that lottery tickets are actionable claims. Therefore, as lottery tickets would not come within the meaning of the expression goods under clause (7) of Section 2 of the Sale of Goods Act, 1930, they would also not come within the scope and ambit of clause (50) of Section 65 of the Finance Act, 1994. The conduct of lottery is a revenue generating activity by a State or any other entity in the field of actionable claims. The client, i.e., the State is not engaging in an activity of service while dealing with the business of lottery. Explanation to subclause (ii) of Clause 19 of Section 65 of the Finance Act, 1994 cannot bring within sub-clause (ii) by assuming an activity which was initially sought to be covered under sub-clause (i) thereof but could not be by virtue of the definition of goods under the very same Act read with Section 2(7) of the Sale of Goods Act, 1930. The mere insertion of an explanation cannot make an activity a taxable service when it is not covered under the main provision (which has to be read into the said subclause by virtue of the legislative device of express incorporation). This is because sale of lottery tickets is not a service in relation to promotion or marketing of service provided by a client, i.e., the State in the instant case. Conducting a lottery which is a game of chance is ex facie a privilege and an activity conducted by the State and not a service being rendered by the State. Either under sub-clause (i) of clause (19) of Section 65 or under the Explanation to sub-clause (ii) of Clause 19 of Section 65 of the Finance Act, 1994, after it was introduced with effect from 16.05.2008 and until it was omitted, service tax could not have been levied on the promotion or marketing of sale of goods or service provided by the client, on the premise that it was a business auxiliary service . The High Courts have lost sight of the definition of goods in clause (50) of Section 65 of the Act while interpreting the expression lottery . The definition of goods in clause (7) of Section 2 of Sale of Goods Act, 1930, that is expressly incorporated in clause (50) of Section 65 of the Act, which expressly excludes actionable claims. This Court has by the Constitution Bench in Sunrise Associates [ 2006 (4) TMI 118 - SUPREME COURT ] opined that lottery tickets are actionable claims. The High Courts have also lost sight of the fact that the sale of lottery tickets by the State is a privileged activity by itself and not rendering of a service for which the assessees are rendering promotion or marketing service. The appeals filed by the appellants-assessees are liable to be allowed and are allowed by setting aside the impugned judgments of the High Courts of Sikkim and Kerala.
-
2024 (9) TMI 181
Demand of short paid service tax along with interest and for imposing penalties - quantification of service tax - HELD THAT:- There is indeed certain discrepancies with regard to quantification of service tax. The amount paid by the appellant is noted as Rs.1,16,81,965/--. On the basis of challans given in the Table the amount shown as paid by the appellant does not match. For this reason, it is opined that the matter requires to be remanded to the adjudicating authority who is directed to requantify the service tax for the disputed period on the basis of details and documents furnished by the appellant. The issue of receipt basis upto 2011 has to be taken note of. The adjudicating authority shall also consider that, if the appellant has paid the entire amount for the disputed period and then there would not be any further liability. In the present case, since the demand raised is only on incorrect calculation of service tax in the SCN, it shows that the appellant has not suppressed facts with intent to evade payment of duty. For this reason, the penalty imposed under Section 78 of the Finance Act, 1994 requires to be set aside. The impugned order is modified to the extent of setting aside penalty under Section 78 of the Finance Act, 1994. The appeal is partly remanded for verifying the quantification of service tax. In case any balance is to be paid, the appellant is liable to pay service tax along with interest - Appeal allowed in part and part matter on remand.
-
2024 (9) TMI 180
Taxability - renting of immovable property service - failure to pay service tax correctly on the properties rented out by them for commercial purpose - imposition of penalties u/s 78 and 77 of the Finance Act, 1994 - HELD THAT:- There was bonafide belief on the part of the appellant for non-payment of tax as litigation was going on in the Hon ble Delhi High Court in the case of HOME SOLUTION RETAIL INDIA LTD. VERSUS UOI ORS. [ 2009 (4) TMI 14 - DELHI HIGH COURT] as well as in the Hon ble Supreme Court regarding taxability of rent on immovable property , however, the appellant have regularly been filing ST-3 returns and wherever service tax has been paid by the recipients of service, it is a matter of record that on such amount, service tax was deposited in time by the appellant with the department. It is also a matter of fact that entire amount of service tax short paid, which has been made payable by the Hon ble Delhi High Court in HOME SOLUTIONS RETAILS (INDIA) LTD. VERSUS UNION OF INDIA ORS [ 2011 (9) TMI 46 - DELHI HIGH COURT] , the appellant have deposited the entire short paid service tax. The extended time proviso for demanding service tax because of the reason that fraud, suppression of facts, mis - representation or contravention of any provisions with intent to evade payment of service tax are not present in this case and the service tax has already been paid before issue of show cause notices. The provisions of Section 78 of Finance Act, 1994 for imposition of penalties on the appellants are not sustainable - the impugned orders-in-appeal upholding imposition of penalties under Section 77 and 78 of the Finance Act, 1994 is not sustainable and therefore set aside - appeal allowed.
-
2024 (9) TMI 179
Classification of service - rent-a-cab service or not - hiring of two numbers of 45-seater buses to M/s. Oil and Natural Gas Corporation Limited (ONGC) for carrying out their operations in different parts of Cachar, Karimganj, Hailakandi District and all other parts of North Eastern Region - HELD THAT:- In the present case, the Appellant has rented out two 45-seater buses to M/s. ONGC for transportation of people in the State of Assam and parts of North-Eastern Region. The vehicles were required to be given for 24/12 hour duty and payments were made on the basis of kilometre, duration as well as mileage. It is observed that the ownership of the vehicles remained with the Appellant during the period of the contract. The appellant has submitted that in rent-a-cab service, the ownership and possession of the vehicle is temporarily dispossessed from the owner and given to the person who is hiring the said vehicle; however, in this case, the ownership remained with the Appellant themselves and thus the service rendered by them is not rent-a-cab service . The Appellant is the owner of the said vehicles and they have not given the possession of the vehicles to ONGC. In renting, the ownership and possession of the vehicle is given to the service recipient, which is not the case here. Thus, it is observed that the service rendered by the appellant in this case is only transportation and not renting. Accordingly, the service rendered by the Appellant is not liable to Service Tax under the category of rent-a-cab service . This view has been held by the Tribunal in the case of SHREE GAYATRI TOURIST BUS SERVICE VERSUS CCE VADODARA [ 2012 (5) TMI 126 - CESTAT, AHMEDABAD [LB] ] where it was held that 'Tribunal in the case of Shree Sai Krishna Travels (2009 (9) TMI 515 - CESTAT, BANGALORE) was considering an identical issue and has held that in this kind of situation, the services rendered by the assessee cannot fall under the category of Rent-a-Cab services, as per the definition enshrined at Section 65 (91) of the Finance Act, 1994.' The demand of service tax confirmed in the impugned order under the category of rent-a-cab service is not sustainable. Since, the demand itself is not sustainable, the question of demanding interest and imposing penalty does not arise - appeal allowed.
-
Central Excise
-
2024 (9) TMI 178
Cenvat credit of service tax paid on outbound transit insurance - Cenvat credit of service tax paid on transportation for pickup and drop facility for employees - Cenvat credit of service tax paid on hospitality and management services. Cenvat credit of service tax paid on outbound transit insurance - HELD THAT:- On going through the ruling by Hon ble Supreme Court in the case of COMMISSIONER OF CENTRAL EXCISE, BELGAUM VERSUS M/S. VASAVADATTA CEMENTS LTD. [ 2018 (3) TMI 993 - SUPREME COURT] , it is found that cenvat credit of service tax paid on insurance premium associated with outward transportation of final product from factory gate to depot for the period upto 01.03.2008 is admissible. Thus, out of the cenvat credit of Rs.31,60,453/-, appellant is entitled to avail cenvat credit which was service tax paid on such insurance premium upto 01.03.2008. Cenvat credit of service tax paid on transportation for pickup and drop facility for employees - HELD THAT:- It is observed that Hon ble Karnataka High Court has in both the cases, relied upon by learned counsel for the appellant, such as COMMISSIONER OF CENTRAL EXCISE, BANGALORE-III, COMMISSIONERATE VERSUS STANZEN TOYOTETSU INDIA (P.) LTD. [ 2011 (4) TMI 201 - KARNATAKA HIGH COURT] and COMMISSIONER OF CENTRAL EXCISE, BANGALORE-I VERSUS BELL CERAMICS LTD. [ 2011 (9) TMI 792 - KARNATAKA HIGH COURT] , ruled that such services are input services and by following the ruling by Hon ble Karnataka High Court, appellant was entitled for availment of cenvat credit of Rs.10,63,186/- during the period of dispute on service tax paid on bus transportation utilized for pickup and drop of employees. Cenvat credit of service tax paid on hospitality and management services - HELD THAT:- The contention of Revenue is accepted that since the appellant is in the jurisdiction of Hon ble Bombay High Court, the ruling by Hon ble Bombay High Court in the case of CCE VERSUS MANIKGARH CEMENT [ 2010 (10) TMI 10 - BOMBAY HIGH COURT] will prevail and it is found that as per the said ruling, appellant is not entitled to avail cenvat credit of Rs.20,73,220/-. Appeal allowed in part.
-
2024 (9) TMI 177
Clandestine removal - shortage of stock - suppression of material facts - demand raised on the strength of private records - absence of corroborative evidence - time limitation - HELD THAT:- There is no allegation that any private records were recovered towards the receipt of the clandestine proceeds by way of cash. Apart from this, the clandestine clearance would entail not only dispatch, but purchase of raw materials, excess consumption of electricity [which is not accounted for in the normal course], inward movement of raw materials and consumables and finally outward movement of the clandestinely removed goods. No details in these areas have been gathered by the Revenue. The bare minimum requirement would be to verify the outward movement details by questioning the truck owners/transporters, when the vehicle numbers are purportedly been shown in the recovered diary/note sheets. Thus, the Revenue with the sole evidence coming in the form of the recorded Statements of the Director Mr Daga on three occasions - the Revenue has not discharged its onus to prove the clandestine manufacture and dispatch of the goods in question with proper corroborative evidence. Shortages found during the stock verification - HELD THAT:- The verification report is not corroborated by way of supporting documents like weighing slip, quantification method adopted etc. As the appellant has submitted, in some case, the stock taking process could not have been completed in the short time said to have been taken to arrive at the actual quantity of stocks. The appellant s arguments that the stock taking should have been taken in the presence of the Panchas cannot be subscribed. It would be sufficient if the same taken in the presence of the officials of the appellant, which has been done in this case. However, the details of the method adopted to quantify the stocks is not to be seen from the Revenue s investigation - The ratio laid down in the above decisions is squarely applicable to the facts of the present case. Accordingly, the confirmed demands towards the shortage found during the stock taking is legally not sustainable. Time Limitation - HELD THAT:- The Revenue had no case to invoke the extended period to confirm the demand, when the issue has come to their knowledge in July 2008. Therefore, the impugned order set aside even on account of limitation. All the appeals are allowed both on merits and on account of limitation.
-
2024 (9) TMI 176
Seeking to deny and recover Cenvat Credit - entire proceedings have been taken up without any proper verification and investigation and hence the demand itself is on assumptions and presumptions basis - suppression of facts or not - Extended period of Limitation. The first submission of the appellant is that while the demand is in account of 245 transactions, the investigation was taken up for only 67 transactions - HELD THAT:- The allegation can sustain only on such invoices on which the investigation has taken place and non-receipt if conclusively proved. The investigation in respect of 67 invoices [about 27% of the total 245], even wherein the appellant has pointed several anomalies, cannot be generalized to simply interpolate same allegation for the balance 178 [about 73%] in order to make the demand. This is serious a flaw in the investigation process. Without doubt this action of the Revenue clearly vitiates the proceedings in respect of these 178 Invoices. Hence, there are no legal provision for confirmation of the demand of Rs.1,00,55,148 - appeal allowed. Demand confirmed in respect of 32 Invoices, wherein statements have been recorded from the owners of the Vehicles - HELD THAT:- When the statement itself is recorded after about 1 to 5 years of the transaction, how far their statement can be relied on is doubtful. It is also on record that the appellant has sought cross-examination of many of the persons, which has not been granted by the Adjudicating authority for which he has come out with some justification. But Section 9D requires the recorded statement before the investigation officer to be once again reiterated before the Adjudicating authority for having been given without any coercion or force, before the same can be admitted as evidence. This has not bee done in this case. Normally in such cases, the matter remanded to the Adjudicating authority to produce these persons for Cross-examination - in the present case, the Statement itself was recorded much later in July to September 2013. Now asking the adjudicating authority to follow this procedure after another 11 years, will not serve any purpose, since the persons giving the statement are not from any Corporate or big companies. They were all vehicle owners and the ownership would changed several hands by now - the confirmed demand of Rs.18,69,286 set aside - appeal allowed. Demand confirmed on account of the information obtained from the Vahan Dept. - HELD THAT:- The Dept. cannot come to a conclusion that the vehicle in question could not have been used for delivery of the goods. Again in respect of the vehicles which are recorded as banned vehicles , the possibility of such vehicles still being used for delivery cannot be ruled out. This leaves out a few more cases where the vehicle numbers pertain to non-transport goods. There may be a possibility that such numbers are used by vehicle owners in order to avoid payment of Road and other taxes. But no definite conclusions can be arrived at. Extended period of limitation - HELD THAT:- The appellant is an assessee with the Dept. They have been taking the Cenvat Credit and also filing their Returns. It is not the case of the Dept. that any private records have been recovered towards the cash transactions. The Dept. has not brought in any evidence to the effect that any suppression has taken place from the appellant s side. Hence, the confirmed demand for the extended period is legally sustainable on account of time bar. Appeal allowed.
-
2024 (9) TMI 175
Entitlement for benefit of N/N. 12/2012 CE dated 17.03.2012 - Revenue classified goods under 21069099 saying that food preparation of cleared are not sealed containers - HELD THAT:- Whereas, the classification by Revenue is contrary to the facts of the case that appellant is selling the goods in packed condition which means that the appellant is selling the goods in sealed container. Therefore, the serial no. 38 of the notification is not applicable to the facts of the case and the appropriate classification of the good by the appellant is 210690 which is enumerated at Sl. no. 37 of the notification and same is having nil duty. Therefore, as contents of the notification are very clear and applicable to the facts of the case, in that circumstances, it is held that the classification of the goods in question is TSH 210690 and appellant is entitled to benefit at notification no. 12/2012 CE dated 17.3.2012 at serial no. 37 thereof. The demand of duty on the issue of classification is not sustainable against the appellant - As demand already been set aside no penalty is imposable on the appellant - appeal allowed.
-
2024 (9) TMI 174
Time Limitation - periodical refunds of duty paid under Section 4A have been sanctioned in terms of Notification No. 32/99-CE dated 08.07.1999, which were never challenged and had attained finality - HELD THAT:- It is found that, as held in the decision of COMMISSIONER OF CENTRAL EXCISE, VERSUS M/S. JELLALPORE TEA ESTATE [ 2011 (3) TMI 11 - GAUHATI HIGH COURT ], the Revenue could not have raised the demands under Section 11A of the Central Excise Act, 1944, without challenging the refund sanctioning orders. As it has been clarified that appellants are required to pay duty on MRP basis and they are entitled to avail abatement vide Notification No. 14/2008-CE(NT) dated 01.03.2008, in that circumstances, the extended period of limitation is not invokable as the date and method of payment of duty was known to the Department and appellants have paid duty as per the clarification given by the Department. There are substance in the ld. counsel's arguments that, in such a scenario it was not open to the revenue to take recourse to the extended period of limitation. It is also found that prior to the DGCEI's investigations in the month of October 2010, the Anti Evasion Unit had also visited the appellant's premises, issued spot summons and seized documents. The appellant no.2 also had undergone audit prior to the impugned proceedings and the issue of assessment under Section 4A had not been raised by the Audit. Accordingly, the appellants succeed on limitation. As there is no demand sustainable against the appellants on limitation, therefore, no penalty can be imposed on the appellants. The impugned order set aside - appeal allowed.
-
CST, VAT & Sales Tax
-
2024 (9) TMI 173
Challenge to re-assessment for the year 2012-2013 - petitioner contends that the Liquidator was never issued with notice of re-assessment and could not participate in the re-assessment - applicability of moatorium - HELD THAT:- In the present case, admittedly, in the case of the assessee the liquidation proceedings had commenced by Annexure-2 order dated 06.02.2020 and the Liquidator was appointed. As we saw from Annexure-C, the notices were all issued to the e-mail of the assessee after the Liquidator was appointed which makes it clear that the Liquidator was never informed of the re-assessment proceedings. In such circumstances, Annexure-C suffers from the defect of the assessee having not been heard. In the present case, initially the State had also objected to the filing of the writ petition, which was without getting an approval from the NCLT. When the objection was raised, the Liquidator had approached the NCLT for ex post facto approval which was denied. An appeal to the National Company Appellate Tribunal, however, found favour with the contention and declared the writ petition filed to be one with proper approval as granted by the Appellate Tribunal. The Liquidator should be noticed and participated in the re-assessment proceedings. Only for violation of principles of natural justice, we set aside the Annexure-C order without going into the merits of the matter. The Liquidator shall appear before the Assessing Officer on 21.08.2024 after filing proper objections. The assessment order at Annexure-C itself shall be considered as a notice for re-assessment. After filing the objection, the Assessing Officer shall hear the matter on the same day or any other date with intimation to the Liquidator, who is representing the assessee. Petition allowed.
-
Indian Laws
-
2024 (9) TMI 172
Land acquisition proceedings - Doctrine of merger - private interest and public interest - principles of res judicata - prospective overruling - dismissal of a civil appeal preferred by one appellant in the first round operates as res judicata against the other appellant in the second round or not - suppression of the first round of litigation by the appellants constitutes a material fact, thereby inviting an outright dismissal of the appeals at the threshold or not - doctrine of merger operate as a bar to entertain the civil appeals in the present case or not - previous determination of the rights of subsequent purchasers in an inter se dispute precludes the same issue from being reconsidered between the same parties or not. Res judicata - HELD THAT:- Res judicata, as a technical legal principle, operates to prevent the same parties from relitigating the same issues that have already been conclusively determined by a court. However, it is crucial to note that the previous decision of this Court in the first round would not operate as res judicata to bar a decision on the lead matter and the other appeals; more so, because this rule may not apply hard and fast in situations where larger public interest is at stake. In such cases, a more flexible approach ought to be adopted by courts, recognizing that certain matters transcend individual disputes and have far-reaching public interest implications. Suppression of material facts by appellants - HELD THAT:- A Bench of two Hon ble Judges of this Court in M/S S.J.S. BUSINESS ENTERPRISES VERSUS STATE OF BIHAR AND ORS [ 2004 (3) TMI 752 - SUPREME COURT ] held that a fact suppressed must be material; that is, if it had not been suppressed, it would have influenced the merits of the case. Law is well settled that the fact suppressed must be material in the sense that it would have an effect on the merits of the case. The concept of suppression or non-disclosure of facts transcends mere concealment; it necessitates the deliberate withholding of material facts those of such critical import that their absence would render any decision unjust. Material facts, in this context, refer to those facts that possess the potential to significantly influence the decision-making process or alter its trajectory. This principle is not intended to arm one party with a weapon of technicality over its adversary but rather serves as a crucial safeguard against the abuse of the judicial process. Doctrine of merger - HELD THAT:- Having held that the concept of public interest need not be viewed narrowly only on the yardstick of loss to public exchequer and that these are the cases where public at large has acquired interest in the public infrastructures already complete or in process of completion, if the doctrine of merger is applied mechanically in respect of Groups A and B.1 cases, it will lead to irreversible consequences. We are satisfied that the element of disparity between Groups A and B.1 cases vis- -vis cases falling in Group C is liable to be eliminated and this can only be done by invoking our extraordinary power under Article 142 of the Constitution of India so that complete justice done between the expropriated landowners, the State and its developing agencies and most importantly the public in general who has acquired a vested right in the public infrastructure projects. Allegations of fraud committed by landowners - HELD THAT:- The law with respect to who can invoke section 24(2) of the 2013 Act has been well settled after the decision of this Court in Shiv Kumar [ 2019 (10) TMI 1411 - SUPREME COURT ] wherein it was held that subsequent purchasers do not have the locus to contest the acquisition and/or claim lapse of the acquisition proceedings. This decision has expressly overruled the previous decision of this Court in Manav Dharam Trust [ 2017 (5) TMI 1761 - SUPREME COURT ] by recognizing the statutory intention behind the 2013 Act, which sought to benefit owners of lands who purchased the lands before the Notification under section 4(1) of the 1894 Act but not for the benefit of those who have purchased the lands after vesting of lands with the State. Petition disposed off.
-
2024 (9) TMI 171
Dishonour of Cheque - Seeking leave to appeal for setting aside of the judgment - burdenn of proving - Section 138 of NI Act - HELD THAT:- The respondent has not denied that the cheques in question belong to him, however, he has denied his signature(s) thereon. In fact, the respondent has neither admitted to the issuance of the cheques in question nor his signature(s) at any stage, be it at the time of framing of notice under Section 251 of the CrPC or at the time of recording of his statement under Section 313 of the CrPC or at the time of producing his evidence. It was incumbent upon the petitioner to discharge the initial burden of proving the issuance of the cheques in question. Besides this, the petitioner, for reasons best known to himself, chose not to examine any other independent witnesses barring himself, especially none of the concerned Bank officials. The cheques in question are themselves shrouded in mystery as there is no clarity qua the facets of as to firstly, who had filled them, secondly, when were they issued and lastly, where were they issued. In essence thereof, as the petitioner was unable to discharge the statutory burden cast upon him, there was no occasion for the presumption under Section 139 of the NI Act arising in his favour. The petitioner was unable to prove anything as regards to his alleged long standing friendly relations with the respondent or as regards any cogent reasons for him allegedly extending an amount of Rs.15,00,000/- to the respondent. Further, the petitioner has not been able to provide any reasonable explanation as to why and based upon what relationship, he had advanced the huge sum of Rs.15,00,000/- to the respondent without taking any receipt or acknowledgment thereof - the respondent, indeed raised a probable defence and was steadfast is his version all throughout, from his response to the legal notice till the proceedings before the learned Trial Court. Also, the respondent had already lodged a Police complaint qua the various documents including the cheques in question being lost much prior to the issuance of the cheques in question. Further, during cross-examination, the respondent had himself called a Bank official, who had indeed deposed that the property papers were in fact deposited in the Bank. This Court finds that the impugned order passed by the learned Trial Court is well reasoned and balanced as it has carefully taken note of all the factors necessary for deciding a complaint under Section 138 of the NI Act and has accordingly adjudicated upon the present dispute. Petition dismissed.
|
9911796707
