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Showing 141 to 160 of 503 Records
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2005 (11) TMI 393 - CESTAT, KOLKATA
Stay/Dispensation of pre-deposit - Clandestine removal ... ... ... ... ..... us and false names and addresses to whom the appellants had purportedly sold the scrap and the Director rsquo s statement. There is no corroborative evidence to co-relate the allegations of clandestine removal, but for the above said points and in the absence of any corroborative evidence, the appellants cannot be directed to pre-deposit the duty. Further I find that it is a settled law that even in case of clandestine removal, if the appellants are eligible for Modvat credit, they can do so even after the issue is brought to notice by the department. In the current case, the Modvat credit available to the appellants is to the tune of Rs. 16 lakhs (Rupees Sixteen Lakhs only) which has been confirmed by the Revenue Authorities at the suppliers rsquo end and hence the appellants have made out a prima facie case for waiver of pre-deposit of duty. The application for stay is granted and the recovery of duty is stayed till the disposal of the appeal. (Pronounced in the open Court)
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2005 (11) TMI 392 - CESTAT, CHENNAI
Demand - Compound levy scheme - Penalty - Compound levy scheme ... ... ... ... ..... ction 3A was very much in the statute during the period of dispute. During the material period, admittedly, the assessee was working under Section 3A and, in the absence of any claim for abatement of duty, they were liable to discharge their duly liability in terms of the ACP determined by the Commissioner. They did pay this duty, albeit belatedly, and such payment was not under protest either. The short question arising in these appeals is whether they had any penal liability for the defaults of monthly payments of duty. Rule 96ZP(3) was a mandatory provision, which burdened a defaulter with penalty. The lower appellate authority appears to have exercised its discretion in a just and fair manner. Accordingly, it has reduced the quanta of penalties substantially. There is no room for further reduction of penalties, let alone for vacating the same. 4. emsp In the result, the impugned order stands affirmed and these appeals are dismissed. (Dictated and pronounced in open Court)
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2005 (11) TMI 391 - CESTAT, MUMBAI
Production capacity based duty - Annual capacity of production ... ... ... ... ..... mination order dated 30-3-1999. The department found that the actual production of the mill during the year 1998-99 had exceeded the annual capacity determined as per the formula prescribed under the Rules and hence sought to redetermine the ACP. lsquo We have carefully gone through the Rules and find force in the appellants rsquo submission that there is no provision for redetermination and that Rule 5, which is relied upon by the learned SDR to support his contention that redetermination is permissible, provides that the annual capacity determined as per the formula shall be deemed to be equal to the actual production of the mill during the previous financial year, but does not provide for redetermination. We, therefore, see merit in the appellants rsquo submission that there is no provision under the Hot Re-rolling Steel Mills Annual Capacity Determination Rules, 1997 for redetermination and accordingly set aside the impugned order of redetermination, and allow the appeal.
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2005 (11) TMI 390 - CESTAT, KOLKATA
Cenvat/Modvat - Duty paying documents ... ... ... ... ..... the absence of any such direction or notice to the registered dealer, the Adjudicating Authority coming to the conclusion of denial of Modvat credit to the appellants does not hold good. Further, I find that it is not in dispute that the registered dealer invoices are regular invoices issued by him for modvatable inputs. If the Registered Dealer did not have any godown, the registration issued to him should have been cancelled by the Revenue Authorities, which is not coming out from the records before me. In the absence of cancellation of the registration of the registered dealer for not having registered premises or godown, the modvatable invoices issued by him cannot be faulted with by the Revenue in the form of disallowing the Modvat credit to the appellants. Under the circumstances as mentioned above, the order-in-appeal deserves to be set aside. Accordingly, I set aside the order-in-appeal with consequential relief if any, to the appellant. (Pronounced in the open court)
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2005 (11) TMI 389 - ITAT MUMBAI
Block assessment in search cases - Search and seizure - Undisclosed income - On money paid for acquiring flats and shops - addition based on loose papers - interior decoration and household expenses -whether the declaration/admission so made in the statement can be effectively and successfully retracted - HELD THAT:- We are of the view that by its declaration and acts the assessee intentionally caused/made the departmental authorities to believe the declaration made by the assessee to be true and induced them to act upon such belief. In our view it is not open to the assessee to change the stand it has already taken and thus cause the situation in his favour by inducing the department not to investigate or enquire into the matter on the seized documents. It is not open to the assessee to turn around of the said declaration.
In fact to our understanding, the affidavit of Shri Manmohan Singh is only a bald denial and nothing else. It does not contain any new evidence, fact or material. There is nothing in this affidavit to rebut the contents of the seized documents as shown on page 7 bundle No. 14 of party R6. Thus, such affidavit or even the letter written to the CIT can neither negate the declaration of disclosure given on oath by the assessee nor can it become the basis of retraction of the declaration made u/s 132(4). When we compare the fact situations in two cases, one when the statement u/s 132(4) was recorded and the other when the retraction was tendered, we find that, in the former, there is very little time and scope of artificiality, or stating falsity, the assessee is not in a frame of mind where he could create some explanation which is not true. Only possibility is that he may, state something or some facts of which he may not be aware.
Whatever spontaneous answers come they are mostly true unless, proved with acceptable facts otherwise. When the statement is given that on- money has been paid, it should be accepted as true because it is in the very personal knowledge of the assessee. What he knows only he can state. Once he states on oath, some thing personal and only known to him, it must be true. About facts and events like this, only he is privy and he also knows the consequences of stating the truth that he has to pay taxes thereon on such disclosure, then the truth becomes an inseparable ingredient of the disclosure.
In the present case the delay in retraction was inordinate. The explanation for delay was far from convincing. What he stated 11 months after he could have stated next day of the search. There was no need for consultation, if whole thing was false. As a matter of fact it was not. Therefore, entire set of submissions relating to retraction deserves to be rejected.
During the course of search, at the residential premises of Mrs. Dolly Ghosh, a memorandum of understanding dated 25-7-1991 signed by her and Shri Manmohan Singh was found. When Shri Manmohan Singh was confronted with this MOU, he admitted to have paid in cash to her for resigning from the partnership. The payment was admitted to be unaccounted. Shri Manmohan Singh thus disclosed a sum for block period. This sum was offered in block return also.
From this it is clear that whatever he has stated u/s 132(4) and admitted as his concealed income was based on documentary evidence confronted to him. There was no disclosure or admission which was not found supported with evidence. The disclosure being on-money for shops and flats in Tulsi Shyam Building was based on document No. 7 bundle No. 14 party R6. Disclosure as based on stamped receipts. The disclosure of Rs. 2,70,000 was based on inspection of the house during the course of search showing freshly carried out renovations etc. On the other hand, the retraction was based on no evidence. In view of the above, we reject the contention of the learned counsel for the assessee that there was any coercion or pressure or duress while recording statement u/s 132(2)/131(1A) and also assessee’s retraction subsequently and uphold the order of the Assessing Officer made on the basis of seized documents as well as disclosure and admission made u/s 132(4) and further enhanced u/s 131(1A).
As a result, addition being on-money paid for acquiring flats and shops in Tulsi Shyam Building, sum based on loose paper Nos. 48 to 50 being stamped receipts and being unaccounted expenditure on renovation and interior decoration covered in ground Nos. 1, 2, 3 in assessee’s appeal are confirmed.
In the result, the appeal of the assessee is dismissed.
Unexplained business expenditure - NRI gift - Payment of on-money towards purchase of flat - After considering the material and also the case laws cited in the case of Shri Manmohan Singh, we are of the view that issue simply boils down to the point that whether statement given u/s 132(4) has to be used against the assessee or retraction is given weightage and additions be deleted. The issue has been considered in detail in the case of Shri Manmohan Singh Vig (HUF) by this Tribunal.
Following the decision of Tribunal in Manmohan Singh Vig (HUF)’s case (supra), we hold that the retraction or rather denial is not established by any material/evidence and hence the same cannot be substituted for admission made by the assessee under sections 132(4) and 131(1A) and supported by documentary evidence found in the search. This is the position in respect of all the impugned additions made by the Assessing Officer. Hence, the additions made are confirmed. No evidence has been furnished to show as to how the case of the assessee does not fall under Chapter XIV-B. We reject this contention. We reject all the grounds raised by the assessee in this regard.
In result, the appeal of assessee is dismissed.
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2005 (11) TMI 388 - ITAT AHMEDABAD
Adjustment towards interest payable u/s 234B(2)(ii) - Calculation of interest under sections 234B and 234C by invoking section 140A - Interpretation of Statute - Calculation of interest on interest - HELD THAT:- Section 234B and section 140A both are separate and independent sections of the Act, section 234B(1) provides general situation of calculation of interest. The period for which interest under this section leviable is from the 1st day of April next following financial year to the date of determination of total income u/s 143(1)/regular assessment. The amount on which interest payable is equal to the assessed tax or the amount by which the advance tax paid falls short of the assessed tax. The facts of controversy under consideration is not related to the above general calculation of interest but falls under section 234B(2). This sub-section (2) of section 234B provides the calculation of interest where tax is paid by the assessee under section 140A or otherwise before the date of determination of total income u/s 143(1)/completion of a regular assessment.
The interest shall be calculated as provided general calculation in section 234B(1). The important thing provides is that simple interest u/s 234B(1) is to be calculated at the prescribed rate. The difference in calculation interest in that section 234B(1) and in section 234B(2) is that in section 234B(2) the simple interest is to be calculated up to the date on which the tax is so paid.
At the time of filing return of income, Explanation to section 140A is required to consider. The newly inserted (with effect from 1-4-1989) Explanation to section 140A(1) takes care of a situation where the amount paid by the assessee u/s 140A(1) falls short of the aggregate of the tax and interest as mentioned therein. In such a situation, the amount, so paid is first to be adjusted towards the interest payable and the balance, if any, is to be adjusted towards the tax payable.
Since the assessee has made short payment, therefore, interest is leviable on Rs. 5,81,520 in accordance with section 234B(2)(ii). This provision is reproduced as above. Thus, this provision required to calculate interest by the prescribed rate on the balance amount by which the tax so paid together with the advance tax paid falls short of the assessed tax.
We are of the considered view that adjustment towards interest payable u/s 234B is to be considered only at the time of filing return of income i.e., when payment of self-assessment u/s 140A is required to be made. Before that interest u/s 234B is independently required to be calculated only in accordance with the provisions provided in section 234B(i). If at the time of filing return it is found short payment after adjustment of interest out of tax paid u/s 140A, further interest is required to calculate in accordance with section 234B(2)(ii), on balance amount which is assessed tax minus advance tax and ad hoc payment.
Thus, we find that approach of revenue for calculation of interest u/s 234B is not correct, therefore, the orders of lower authorities are set-aside and the claim of the assessee is allowed. The Assessing Officer is directed to calculate interest u/s 234B as per above discussion.
In the result, appeals are allowed.
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2005 (11) TMI 387 - ITAT CHANDIGARH
Capital gains ... ... ... ... ..... the case of G.M. Omer Khan (supra). No contrary judgment of the Hon rsquo ble Apex Court was cited by the learned counsel for the assessee. Since the judgment laid down by the Hon rsquo ble Apex Court is law of land, which is to be followed by the subordinate Courts/Tribunal/local Authorities, therefore, in view of the aforesaid judgment of the Hon rsquo ble Apex Court the capital gain earned by the assessee in the present case cannot be considered as exempt since the land situated in the village Bajitpur Thankran which is having a population less than ten thousand but is falling in the Delhi Municipal Corporation, as such, the agricultural land was an asset within the meaning of section 2(14)(iii ) of the I.T. Act and was liable to be taxed on the capital gain arising out of the sale proceeds of that land, in that view of the matter we set aside the order of the learned CIT(A) and restore that of the Assessing Officer. 12. In the result, appeal of the department is allowed.
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2005 (11) TMI 386 - ITAT AHMEDABAD
Exemption u/s 54F - Capital gains - non-resident - whether benefit of section 54F is available to a residential house purchased out of India - HELD THAT:- We noticed that originally the income-tax was first introduced in India in 1860. After independence the Income-tax Bill, 1961 came out of the legislative anvil and the Income-tax Act, 1961, received the assent of the President on 13th September, 1961 and came into force from 1st April, 1962. This Act was made applicable to the whole of India. Since this Act applicable in India, therefore, the provisions of this Act are applicable in India and same are required to be read accordingly. Thus section 54F is also required to read accordingly, the words ‘purchase/construction of a residential house’ on plain and simple reading means, the purchase/construction of a residential house must be in India and not outside India.
Following the decision in the case of Padmasundara Rao [2002 (3) TMI 44 - SUPREME COURT] and K.P. Varghese v. ITO [1981 (9) TMI 1 - SUPREME COURT], we find that a residential house purchased/constructed must be in India and not outside India, in USA. This interpretation is strongly supported by the marginal note to section 54F. Section 54F inserted by the Finance Act, 1982, with effect from 1-4-2003. It has been explained in Circular No. 346,- Explanatory notes on the provisions of Finance Act, 1982 in para 20.2 "with a view to encouraging house construction, the Finance Act, 1982, has inserted a new section 54F.".
Thus, we hold that benefit u/s 54F is not allowable for a residential house purchased/constructed outside India. In the result, the appeal is dismissed.
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2005 (11) TMI 385 - ITAT MUMBAI
Business income - Compensation ... ... ... ... ..... 229 ITR 325 (Bom.) As such the second ground is allowed. 48. The 3rd ground relates to 20 per cent of expenses on food, beverages etc. during conferences at hotels not treated as entertainment expenses. In view of our findings in para 32, the third ground is dismissed. 49. The 4th ground is with regard 20 per cent of expenses on food etc. during conferences at clubs not treated as entertainment expenses. In view of our findings in para 33, the fourth ground is dismissed. 50. The 5th ground relates to expenditure on membership fees of various clubs not treated as business expenditure. Admittedly, the issue is covered in favour of the assessee by the order of the Tribunal for assessment year 1994-95 following the decision of OTIS Elevator Co. (India) Ltd. v. CIT ( 195 ITR 682) (Bom.). As such the 5th ground is dismissed. 51. In the result both the appeals are partly allowed. This order is pronounced at Mumbai in the open court on this day of 11th November two thousand and five.
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2005 (11) TMI 384 - ITAT MUMBAI
Disallowance u/s 40(a)(i) - Purchased software from various non-resident - Revenue expenditure or Royalty u/s 9(1)(vi) - Disallowance u/s 40(a)(ii) on account of service charges - Allocation of expenses in respect of service charges - HELD THAT:- The issue before us has already been concluded by the decision of the Tribunal in assessee’s own case wherein the Tribunal, following its decision in the case of Samsung Electronics Ltd. [2005 (2) TMI 438 - ITAT BANGALORE-A] has held that payment made by assessee for purchase of software did not amount of ‘Royalty’ within the ambit of section 9(1)(vi) of the Act and therefore, assessee was not liable to deduct tax at source u/s 195. Following the said decision, it is further held that, as a necessary corollary, the provisions of section 40(a)(i) could not be applied to the case of assessee. The finding of CIT(A) that payment towards purchase of software amounted to ‘Royalty’ within the meaning of section 9(1)(vi) of the Act is hereby vacated.
In the present case, it has been noted by the CIT(A) that the non-resident had paid the tax on 22-3-2004, consequently, deduction could be claimed only in the assessment year 2004-05 and not in the year under consideration. The CIT(A), therefore, was incorrect in holding that no disallowance could have been made u/s 40(a)(i ) of the Act as the tax was ultimately paid by non-resident. Accordingly, we also vacate this finding of the CIT(A).
Thus, we set aside the order of CIT(A) and deleted the entire disallowance u/s 40(a)(i) made by Assessing Officer and sustained by CIT(A).
We find that the issue regarding the allocation of expenses in respect of service charges arose in the case of SSL. In that case, the Assessing Officer was of the view that allocation of expenses of Non-10A unit (not eligible for exemption) was excessive as exempted unit was much more expenditure oriented. The matter ultimately reached the Tribunal which accepted the case of assessee that allocation of support services expenses on the basis of turnover was justified.
Admittedly, prior to incorporation of assessee company, SSL was carrying on two units independently i.e., unit exempted u/s 10A and the unit not exempted. Direct expenses incurred were separately booked to respective units. Only the support services expenses were allocated on the basis of turnover.
Faced with the same, the ld. DR had nothing to add except to rely on the order of Assessing Officer. The ld. DR submitted that allocation of expenses requires verification and therefore, the matter may be referred to Assessing Officer for necessary verification. We are unable to accept this request since there is no dispute to the factual position that allocation of service expenses was made on the basis of turnover. No useful purpose would be served in restoring the issue. Accordingly, following the finding of the Tribunal in the case SSL, we set aside the order of CIT(A) on this issue and delete the disallowance sustained by him.
In the result, the appeal of the assessee is allowed while the appeal of revenue is dismissed.
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2005 (11) TMI 383 - ITAT CHANDIGARH
Penalty - For concealment of income ... ... ... ... ..... om the Latin word concolare which implies to lsquo hide rsquo . The offence of concealment is thus a direct attempt to hide an item of income or a portion thereof from the knowledge of the income-tax authorities. In furnishing its return of income, an assessee is required to furnish particulars and account on which such returned income has been arrived at. These may be particulars as per books of account it has maintained or any other basis upon which it has arrived at the returned figure of income. Any inaccuracy made in such books of account or otherwise which results in keeping of or hiding a portion of its income is punishable as furnishing inaccurate particulars of its income. While coming to this conclusion, reference can be drawn from the decision in CIT v. Indian Metal and Ferro Alloys Ltd. 1994 117 CTR (Ori.) 378. 10. In view of these facts, we have not found any mistake in the conclusion of the ld. CIT(A). The same is upheld. The appeal of the assessee is dismissed.
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2005 (11) TMI 382 - ITAT DELHI
Reimbursement of actual cost incurred - Income from advisory services - DTAA between India and USA - HELD THAT:- We have gone through the aforesaid Tribunal order in the assessee’s own case for assessment year 1996-97. The same issue, as is before us, was also considered by the Tribunal in the aforesaid order for the immediately two preceding assessment years. The Tribunal held that the question as to whether the reimbursement of actual cost incurred by the assessee could be considered as the income of the assessee, was squarely covered by the judgment of the Hon’ble Delhi High Court in the case of CIT v. Industrial Engg. Products (P.) Ltd.[1992 (7) TMI 38 - DELHI HIGH COURT], wherein it has been held that the reimbursement of expenses cannot be considered as the assessee’s income. The Tribunal, as such, held in favour of the assessee. However, the factual aspects needing verification, the Assessing Officer was directed to delete the amount of reimbursement of actual expenses incurred by the assessee after verification.
The facts involved in the assessment year under consideration indubitably being pari materia with those present in assessment years 1996-97 and 1997-98, the aforesaid Tribunal decisions for these years is squarely applicable for this year also. Therefore, respectfully following the said Tribunal order, in the assessee’s own case, for this year also, it is held that reimbursement of expenses cannot be considered as the income of the assessee. The Assessing Officer is directed to delete the amount of reimbursement of actual expenses incurred by the assessee, after verification.
As a result, the appeal is partly allowed, as indicated.
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2005 (11) TMI 381 - ITAT BANGALORE
Business income, Losses - In speculation business ... ... ... ... ..... re squarely covered by the earlier decision of the Coordinate Bench of the ITAT, Bangalore in its order dated 20th July, 2005. Respectfully following the said appellate order and also following the ratio laid down in various judicial decisions of the Supreme Court in Gillanders Arbuthnot and Co. Ltd. v. CIT 1964 53 ITR 283 , Kettlewell Bullen and Co. Ltd. v. CIT 1964 53 ITR 261, CIT v. Best and Co. (P.) Ltd. 1966 60 ITR 11 and the decision of the Madras High Court in CIT v. Saraswathi Publicities 1981 132 ITR 207, CIT v. G.D. Naidu 1987 165 ITR 63 , CIT v. T.I. and M. Sales Ltd. 2003 129 Taxman 444 and the decision of the Calcutta High Court in the case of Saroj Kumar Poddar ( supra), we hold that the CIT(A) was justified in holding the sum of Rs. 2,02,00,000 received as a consideration for restrictive covenant in the form of non-competition obligation was a capital receipt. In the result, the assessee rsquo s appeal is partly allowed and the Departmental appeal is dismissed.
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2005 (11) TMI 380 - ITAT NEW DELHI
Rent, rates, taxes, repairs and insurance for buildings ... ... ... ... ..... derstood by a prudent businessman. Therefore, unless the Legislature intended a departure from the principle that an expenditure laid out or expended wholly and exclusively for the purposes of the business and which expenditure is not capital in nature or personal expenses it should not be allowed in computing the income from the business, deduction should be granted for the said expenses (f) sections 30 to 36 deal with specified expenses and for specific purposes. The nature of expenditure in those sections would be relatable only to the purposes mentioned therein. rsquo 12. In the facts of the present case in our view the principles laid down above are clearly applicable and consequently the deduction claimed by the assessee deserves to be allowed. We therefore hold that the disallowance made by the revenue authorities cannot be sustained and the same is directed to the allowed. The appeal by the assessee is allowed. 13. In the result, the appeal by the assessee is allowed.
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2005 (11) TMI 379 - ITAT DELHI
Unexplained investments ... ... ... ... ..... ained. 30. Shri Talwar also submitted that assessee had submitted return disclosing income of Rs. 14,28,255 and was liable to pay tax at the rate of 30 per cent. On long term capital gain he was supposed to pay tax at 10 per cent or so. So just to save tax at the rate of 20 per cent on gains, the assessee would not have taken such great risk to manipulate and fabricate evidence. In the above circumstances it was argued that the case of the assessee as pleaded be accepted. We are unable to accept this contention of the assessee. As discussed in detail, the revenue has brought sufficient material on record to show that transactions in dispute were not genuine. The assessee failed to discharge the onus that lay on him to prima facie explain the deposits in the Bank accounts. The law has to take its own course. No note can be taken of these extraneous considerations. The contention is accordingly rejected. For the reasons given above, the appeal of the assessee is partly allowed.
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2005 (11) TMI 378 - ITAT BANGALORE
Capital gains ... ... ... ... ..... al Bhasin 1979 117 ITR 26 and the Hon rsquo ble High Court of Kerala in the case of CIT v. P.N. Sreenivasa Rao 1988 171 ITR 562 have held that the amount received by the assessee on his retirement from the firm, being his share of the difference between the market value and book value of the assets, are not liable to tax as capital gains. The CBDT in its Circular No. 495, dated 22-9-1987 has made it very clear that to tax the capital gain on transfer of goodwill is only to cover those cases where goodwill is actually transferred and in the instant case, there is no actual transfer of goodwill. 6. Taking into consideration all these facts and legal dictums, we are of the opinion that there is no transfer of goodwill and therefore, the excess amount received by the assessees are not taxable. In that view of the matter, we confirm the order of learned CIT(A) granting relief to the assessee. It is ordered accordingly. In the result, the appeals filed by the Revenue are dismissed.
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2005 (11) TMI 377 - ITAT BANGALORE
Deductions under sections 80HHC and 80-IB - Sale consideration of technical know-how drawings, designs, technology to the non-resident of manufacture of segmented tyres and DEPB licence eligible for deduction under section 80HHC? - Implication of the provisions of section 80-IB(13) read with section 80-IA(9) - HELD THAT:- In the present case, it is seen that the assessee received the consideration for providing design, development and manufacturing assistance and for defining tooling design and production process. This was done by transferring various design documents and connected papers therewith. The conjoint and harmonious reading of various definitions as well the ratio laid down by Hon’ble Supreme Court leads us in no doubt that the amount received by assessee for sale of design, development and manufacturing technology of laminated tyres amounts to sale of goods or merchandise and hence eligible for deduction under section 80HHC. It is not correct to hold that the amount received falls within the term "in consideration for the use of any patent, invention, design or registered trade mark" used in section 80-O of the Act. The amount received is not for use of but for sale of the drawing, design and technology as such. After the transfer of design and technology, the same is the property of purchaser and no longer remains with the assessee. Thus, the amount received is not for merely allowing use of such drawing, design or technology but for sale of such product, which falls within the definition of "goods or merchandise" within the meaning of section 80HHC of the Act. We accordingly hold that since the amount is received inconvertible foreign exchange as specified under section 80HHC, the assessee is entitled to deduction under section 80HHC of the Act. In view of our above answer, it is not necessary to deal whether the amount received is eligible for deduction under section 80-O also or not.
Whether the assessee is entitled deduction u/s 80HHC as well as 80-IB and the implication of sub-section 9 of section 80-IA or sub-section 13 of section 80-IB - In view of the decision of this Tribunal in the case of Mittal Clothing Co. [2005 (6) TMI 480 - ITAT BANGALORE] and in view of the CBDT Circular No. 772, we hold that the assessee can claim deduction u/s 80HHC as well as section 80-IB. However, it is made clear that the total deduction in both the sections will not exceed the profit included in the gross total income, as sections 80AB governs both section 80HHC and section 80-IB.
Sale of DEPB licence will be excluded as per clause (baa) of Explanation to section 80HHC - It is the contention of assessee that such amount do not fall under clause (iiia) of section 28 of the Act but falls under clause 28(iv) of the Act. Since clause (baa) refers merely to clause (iiia) of section 28 and since clause (iv) of section 28 is not referred to in clause (baa), the same is not to be excluded while computing profits of business for the purpose of section 80HHC. We are in agreement with the submission of learned counsel for assessee. Profit on sale of DEPB licence is not equivalent to profit on sale of licence granted under the Imports (Control) Order, 1955 made and under the Imports and Exports (Control) Act, 1947 referred in section under clause (iiia) of section 28. Similar view has been held by ITAT, New Delhi Bench in the case of P&G Enterprises [2004 (11) TMI 287 - ITAT DELHI-B]. We accordingly hold that while computing "profits of business" for the purpose of section 80HHC, profit on sale of DEPB licence will not be excluded under clause (baa) of Explanation to section 80HHC.
In the cross-objection, it was contended that the amount realized on sale of DEPB credits is not eligible for deduction u/s 80HHC. Since it has been held that the amount realized on sale of DEPB credit is assessable as business income u/s 28(iv) of the Act, the word ‘profit of business’ will also include profit on sale of such DEPB credit.
In the result, the appeal is partly allowed and the cross-objection is dismissed.
-
2005 (11) TMI 376 - ITAT CHANDIGARH
Penalty - For failure to keep, maintain or retain books of account, etc. ... ... ... ... ..... is evident from the statement of facts, the case of the assessee is covered by the provisions of section 44AA of the Act, specially when the assessee has admittedly not maintained any books of account. No reasonable cause in any manner has been adduced by the assessee in not maintaining the books of account, so the provision of section 271A of the Act is clearly attracted. It is not the case of the assessee that the mistake is bona fide, specially when it is not the first year of the business of the assessee, meaning thereby the assessee is not even a new businessman. It can be said it is not a bona fide mistake, rather a deliberate mistake on the part of the assessee. No reasonable cause was adduced before me during proceedings by the assessee. In view of these facts, I have not found any mistake in the conclusion of the ld. CIT(A). The same is upheld. 6. Ground Nos. 3 and 4 are prayer only, requires no deliberation. 7. In the result, the appeal of the assessee is dismissed.
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2005 (11) TMI 375 - ITAT MUMBAI
Foreign Institutional Investors ... ... ... ... ..... t of Rs. 19,09,457 under section 234C of the Act. The appellant submit that the total income of the appellant included capital gains, which arose in different periods of instalments, as per the summary which was filed with the return of income, and a copy of which is enclosed herewith. The appellant therefore, contended that they have correctly paid advance tax in the relevant instalments in which capital gains arose and therefore, interest under section 234C levied by the Assessing Officer is wholly erroneous. The appellants pray that the Assessing Officer be directed to compute interest under section 234C, if any, after considering the period-wise capital gains and advance tax paid thereon. 9. It was submitted by the learned counsel of the assessee that in view of the direction of learned CIT(A), this ground is academic and accordingly, we reject this ground, which is admittedly of academic interest only. 10. In the result, this appeal of the assessee stands partly allowed.
-
2005 (11) TMI 374 - ITAT MUMBAI
Commissioner (Appeals) ... ... ... ... ..... t vitiated in law. We agree with the learned DR that so far as the question on merits of the decision on whether or not to decline interest under section 244A(2) is concerned, the CIT(A) is not competent to decide the merits of such denial. However, where action is taken by the Assessing Officer is contrary to the scheme of the Act and without following the provisions of the relevant section, the CIT(A) is indeed empowered to reverse that action. In this view of the matter we approve the conclusion arrived at by the CIT(A) inasmuch as we are of the considered view that the Assessing Officer had no powers but on the facts of this case to decline interest under section 244A, even though our reasoning for reaching that conclusion are different from the reasoning adopted by the CIT(A). That does not however effect the outcome of the decision. 10. For the reasons set out above, we approve the view taken by the CIT(A) and decline to interfere in the matter. The appeal is dismissed.
............
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