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2010 (6) TMI 784 - ITAT DELHI
... ... ... ... ..... e. Thus, the issue has to be decided in favour of the assessee and against the revenue. 9. We find that there may be some error in computation of this amount, as mentioned in the grounds of appeal. The ld. CIT(Appeals) has furnished the net effect of the waiver of loan and interest on page 20 of his order, according to which balances amounting to ₹ 11,53,72,340/- have been written off, but miscellaneous income account has been credited with ₹ 10,89,07,907/-. The ld. CIT(Appeals) has granted the relief amounting to ₹ 13,22,52,000/-, an amount different from the amount credited to profit and loss account as well as the amount of balances written off. Therefore, the AO may ascertain the exact amount written off by the assessee by way of term-loan, cash-credit limit and the interest. Thereafter, he may give effect to this order as mentioned above. 10. In the result, the appeal is partly allowed. This order was pronounced in the open court on 11th of June, 2010.
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2010 (6) TMI 783 - ITAT DELHI
... ... ... ... ..... s of LIC with regard to correct status of keyman policy on the occasion of assignment and consequential treatment of taxability in the hands of the assessee, and to decide the issue afresh as per the terms and conditions applicable to the keyman insurance policy on assignment to the keyman. After the Assessing Officer comes to the conclusion that the keyman policy is converted into an ordinary policy, then he should follow the observation of coordinate bench as in earlier assessment years. 8. In the result, the appeal filed by the assessee is treated as allowed for statistical purposes." 8. Since the facts in the present case are identical, we remit the issue also to the files of Assessing Officer to consider it afresh with the same directions as above. Needless to add that the assessee should be given adequate opportunity of being heard. 9. In the result, appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open court on 04.06.2010.
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2010 (6) TMI 782 - ITAT AHMEDABAD
... ... ... ... ..... icer in the assessment order and Learned Commissioner of Income Tax(Appeals) in quantum appeal, we are convinced that both the additions were made by Assessing Officer and confirmed by Learned Commissioner of Income Tax(Appeals) on account of difference of opinion between the assessee and Assessing Officer. All the material facts were disclosed in the return and, therefore, it cannot be said that assessee had furnished inaccurate particulars or concealed income. In support of this, reliance can be placed on the judgment of the Hon'ble Supreme Court in the case of Reliance Petro Products Pvt. Ltd. (supra). We are, therefore, of the view that Learned Commissioner of Income Tax(Appeals) is legally and factually correct in cancelling the penalty on both the disallowances. We, therefore, incline to uphold the order of Learned Commissioner of Income Tax(Appeals). 8. In the result, the appeal filed by the Revenue is dismissed. The Order was pronounced in the Court on 18.06.2010
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2010 (6) TMI 781 - ALLAHABAD HIGH COURT
Rejection of books of accounts - Estimation of income - determining the net profit rate and turnover - method adopted by the AO for determining the net profit rate during the assessment year - Tribunal has restricted the net profit rate at 3 per cent - Being aggrieved, the Department has filed the present appeals.
HELD THAT:- In the instant case, various discrepancies were found by the AO as has already been pointed out by the learned counsel of the appellant. In such a situation, the AO has no option except to reject the books of accounts and estimate the income as the accounts were found defective and s. 145(2) of the IT Act is applicable as per the ratio laid down in the case of CIT vs. Thakurmal Bajranglal [1987 (7) TMI 21 - RAJASTHAN HIGH COURT] as well as Ramjiwan Lal [1979 (10) TMI 55 - ALLAHABAD HIGH COURT] Therefore, we uphold the rejection of the books of accounts by the AO for the assessment years under consideration.
Additions to the total income shown by the assessee are not necessary concomitant to an order passed under s. 145 or 143(2) of the Act.
In the instant case, by looking at the history, it appears that the net profit rate was in the range of 1.88 per cent to 3 per cent, which was accepted by the AO himself or by the Tribunal which is a final fact -finding authority as observed in the case of Kamala Ganapathy Subramaniam [2001 (2) TMI 132 - SUPREME COURT]
Estimation is a question of fact - See New Plaza Restaurant [2008 (7) TMI 260 - HIMACHAL PRADESH HIGH COURT] and Sanjay Oilcake Industries [2008 (3) TMI 323 - GUJARAT HIGH COURT]
As during the assessment years under consideration, no different yardstick can be adopted and no interference is required as per the ratio laid down in the case of Zora Singh [2007 (2) TMI 153 - PUNJAB AND HARYANA HIGH COURT] - No question of law arises because the method adopted by the AO for determining the net profit rate during the assessment year which is similar as in the other assessment years as per the ratio laid down in the case of Textile Agents [1990 (7) TMI 66 - ALLAHABAD HIGH COURT] - The accounts were rejected and net profit rate was estimated which ultimately leads to the factual aspects of the case and normally no substantial question of law arises as per the ratio laid down in the case of Hargopal Singh [2004 (8) TMI 35 - PUNJAB AND HARYANA HIGH COURT]
We decline to interfere with the impugned orders passed by the Tribunal which are hereby sustained along with the reasons mentioned therein.
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2010 (6) TMI 780 - ITAT MUMBAI
... ... ... ... ..... should be factually verified. 5. On a careful consideration of the rival contentions, we are of the view that the issue having been decided by the Co-ordinate Bench in a Group case, the same should be followed in the present case also. Accordingly, respectfully following the said order, we hold that the indirect expenses should be apportioned in proportion to the cost incurred on various projects during the year, as represented by the work in progress in the different projects. The figures supplied by the assessee before us however need verification. We therefore restore the issue to the file of the Assessing Officer for the limited purpose of verifying the figures of work in progress in the various projects undertaken by the assessee and thereafter to apply the rule laid down in the order of the Tribunal in the case of M/s Ganga Developers (supra). The appeal of the assessee is allowed in part with no order as to costs. Order pronounced in the Open Court on 29 th June 2010.
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2010 (6) TMI 779 - ITAT PUNE
... ... ... ... ..... was paid, 20 per cent whereof i.e., ₹ 4.20 lakhs was claimed by the assessee. The AO has denied the same that the assessee had transferred property to M/s Aditya Developers during the previous year 2003-04 and claimed brokerage payment for this transaction. The AO noted further that the assesseee had during the financial years 2001-02 and 2002-03 had also transferred property to the same party. Under these circumstances, we do not find infirmity in the further observation of the AO that brokerage is paid for finding a buyer, who can give good price for the property. When there was no change of buyer, in our view, there was no question of involvement of brokerage for the transaction between the same party in succeeding year. The learned CIT(A) was therefore, justified in upholding the action of the disallowance made by the AO in this regard. The same is upheld. The ground raising the issue is thus, rejected. 8. In the result, the appeals of the assessees are dismissed.
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2010 (6) TMI 778 - ITAT HYDERABAD
... ... ... ... ..... the Hon’ble President, heard the parties on the above questions, and in his capacity as Third Member vide his order dated 11-6-2010, concurred with the view taken by the Accountant Member and held that subsidy amount received by the assessee was a revenue receipt in the hands of the assessee and accordingly decided the issue in favour of the revenue and against the assessee. As for the issue of expenditure of ₹ 7.83 crores being of revenue nature, the Third Member noted that there is no difference of opinion on this issue between the Vice-President and the Accountant Member constituting the original Bench, since it was held by both of them that the expenditure of ₹ 7.83 crores incurred by the assessee on rectification and improvement of power lines damaged due to cyclone out of capital subsidy, was of revenue nature. 4. Going by the majority opinion, we allow ground No. 4 of appeal of the revenue. 5. In the result, revenue’s appeal is partly allowed.
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2010 (6) TMI 777 - ALLAHABAD HIGH COURT
... ... ... ... ..... Collector Allahabad shall also file sketch map of City Allahabad indicating names of Road passing through particular Mohalla or locality. Besides this the Collector Allahabad is also directed to place material alongwith counter affidavit on the basis of which Circle Rates have been determined by the Collector Allahabad from time to time while issuing the aforesaid notifications. The aforesaid counter affidavit shall be filed immediately on the date of expiry of three weeks. The Collector and A.D.M. Nazul, Allahabad shall also remain present in the Court in person on the date fixed by this Court i.e. on 16.07.2010. List on 16.07.2010 as part heard before us. Registrar General is directed to communicate this order to the Secretary Finance and Revenue U.P. Govt. Lucknow and District Magistrate, Allahabad through fax forthwith. A copy of this order also be given to Learned Chief Standing Counsel, Sri M.C. Chaturvedi for communication and necessary action free of costs forthwith.
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2010 (6) TMI 776 - ITAT MUMBAI
Claimed relief u/s 80IB(1) - profits accruing from the Housing Project - method of accounting - The facts are that the assessee had executed a housing project for which the approval of the Local Authority was obtained. The Commencement Certificate was issued in the name of the assessee. The Assessee has already received the occupancy certificate in respect of Wing A,B & C. on 13.9.2005 & Wing F G & H on 26.9,2006. As regard to the E Wing still 1 to 12 floors the appellant has applied for occupancy certificate on 18.1.2008 after having completed the building which is the last & final wing of the building. The Architect has certified the completion of the building and has applied for the completion certificate on 18.1.08. In the circumstances the Assessee claimed relief u/s 80IB(1) in respect of profits accruing from the Housing Project for the year.
HELD THAT:- We hold that the housing project of the assessee is different and distinct from the project for building commercial area by another entity. Housing project does not include construction of the commercial establishment carried out by another entity in that area. Therefore claim of the assessee for deduction u/s 80 IB (10) for the housing project cannot be denied because the commercial project was carried out by a sister concern in the same area. Having accepted the percentage completion method of determining the profits, it will not be correct to hold that such profits before the completion of the housing project, which otherwise satisfies all the conditions of sec 80 IB(10), though assessed as profits from the housing project will not be entitled to deduction u/s 80 IB (10). the profits from the Housing project assessed on a year to year project will be entitled to deduction u/s 80 IB (10), if it otherwise does not contravene the provisions/ requirements of that section. We find that the CBDT has also clarified vide their Instruction No 4 of 2009 dated 30.6.2009 that relief u/s 80IB (10) can be allowed on a year to year basis where the assessee is showing profits on partial completion of the project. If at the end of the period the Assessee is found not to have complied with the provisions of the section- such as failure to complete the project within the permitted time, then the relief granted for earlier years can be withdrawn. In the circumstances we agree with the CIT(A) that relief u/s 80 IB(10) cannot be denied in the case of the assessee merely because completion of the project is a contingent happening in the future. In the circumstances the profits offered by the assessee for the year from the Housing projects, under percentage completion method of accounting, is the profits derived from an eligible project and is entitled to deduction u/s 80 IB.
In the result the appeal filed by the Revenue is allowed for statistical purposes.
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2010 (6) TMI 775 - ITAT HYDERABAD
... ... ... ... ..... st instance. Since the issue of family arrangement goes to the root of the matter, the other issues raised by the assessee in the appeal have also to be reconsidered by the Assessing Officer. 6. Accordingly, we set aside the order of the lower authorities and remit back the entire issue to the file of the Assessing Officer. The Assessing Officer shall consider the issue on the basis of the materials that may be filed by the assessee and thereafter decide the issue in accordance with law after giving a reasonable opportunity to the assessee. We make it clear that we are not expressing any opinion on the merit of the appeal. The Assessing Officer has to reconsider the entire issue in accordance with law without being influenced by any of the observations made by this Tribunal in this order or of the CIT(A) in the impugned order. 7. With the above observations, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on 28th June, 2010.
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2010 (6) TMI 774 - CESTAT MUMBAI
... ... ... ... ..... lants. It may happen, in some cases that instead of getting 95 yield, the appellants may receive goods to the tune of 94.5 or so. It is the accumulated shortages, which are ultimately taken note of by the appellants, and as a part of the contract between the appellant and job worker, job charges are reduced to that effect, for which purpose the debit notes have been raised. This fact, by itself, does not give any right to the Revenue to demand duty on such shortages, when admittedly such shortages are not on account of less yield. As such, we are of the view that the impugned orders are not sustainable. The same are accordingly set aside and appeal allowed with consequential relief. 11. In this case also the facts are identical to the case law cited herein above. The learned DR also fairly agrees. Hence, following the ratio of the decision mentioned herein above, I set aside the impugned order and the appeal is allowed with consequential relief, if any. (Pronounced in Court)
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2010 (6) TMI 773 - ITAT MUMBAI
... ... ... ... ..... the notifications issued by the SEBI, it was found that such margins were imposed in order to reduce the risk components and, therefore, those were basically risk management oriented penalties, which were routine in nature. It was also found that those violations were offered by payment of penalty as in the instant case. Respectfully following the same, we uphold the order of the first appellate authority and dismiss this ground of the Revenue. 11. Coming to the assessee’s appeal in ITA No. 4033/Mum/2009, the sole issue is the disallowance of lease-line charges and transaction charges on the ground that no deduction of tax at source has been made on payments to BSE and NSE. In view of our discussion in the Revenue’s appeal on the very same issue of applicability of section 194J, we allow this ground of the assessee. 12. In the result, the appeal of the Revenue is dismissed and the appeal of the assessee is allowed. Order pronounced on this 4th day of June, 2010.
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2010 (6) TMI 772 - ITAT HYDERABAD
... ... ... ... ..... ed with the Reserve Bank of India. Therefore, the application filed by the assessee has to be considered in accordance with law by the concerned authority who is empowered to do so. The decision taken on such application has to be communicated to the assessee also. However, in the case before us though admittedly the assessee filed an application for extension of time, the decision taken thereon was not communicated to the assessee so far. Therefore, we cannot blame the assessee for claiming the deduction under section 10A of the Act. In such circumstances, the CIT (A), in our opinion, has rightly directed the assessing officer to verify with City Bank/Reserve Bank of India to find out whether extension sought for by the assessee was granted or not. In these circumstances, we do not find any infirmity in the order of the CIT (A) and accordingly the same is confirmed. 6. In the result, the revenue's appeal stand dismissed. Order was pronounced in the Court on 25 - 6-2010.
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2010 (6) TMI 771 - ITAT AHMEDABAD
... ... ... ... ..... nt of contract and section 43(5) is not attractive.” Considering the facts and circumstances of the case in the light of decisions of the Tribunal in the case of the same assessee for assessment year 2003-04 and in the case of Voltas International Ltd. (supra), we are of the view that provisions of section 43(5) of the IT Act would not apply to the case of the assessee. The income earned by assessee on account of cancellation of forward exchange contract should be treated as business income and not income from speculation. We accordingly set aside the orders of authorities below and direct the A O to treat the income on this issue as business income. As a result, this ground of appeal of the assessee is allowed. 21. In view of the above, the appeal of the assessee is partly allowed. 22. No other point is argued or pressed. 23. As a result, departmental appeal is dismissed and the appeal of the assessee is partly allowed. Order pronounced in the open Court on 11-06-2010
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2010 (6) TMI 770 - ITAT VISAKHAPATNAM
Capital gain computation - addition u/s 50C - Aggregate difference between the apparent sale consideration and the market value - as per DR AO has to make a comparison between the apparent consideration and the value adopted or assessed for stamp duty purposes and that there is no reference in the sale deed, of the details of advance payments made by the vendees -
HELD THAT:- As decided in K.P. Verghese Vs. ITO,[1981 (9) TMI 1 - SUPREME COURT] held that the provisions of section 52(2) that was existing at the relevant point of time was not applicable to a honest and bona fide transaction where the consideration received by the assessee was correctly declared or disclosed by him and there was no concealment or suppression of the consideration.Hon’ble Supreme Court, after considering the speech of the Finance Minister, has understood that the object of introduction of section 52(2) was to curtail those transactions of sale of property, where the actual consideration received was understated in the sale deed.
The purpose of introduction of section 52(2) earlier and section 50C w.e.f. 1.4.2003 are for the purpose of achieving similar objectives.
In the instant case also, the assessee herein has fulfilled a contractual obligation on 30-6- 2005, which the assessee is bound by law to carry out as per the sale agreement entered in March, 2003.
Whether there was any under statement of actual consideration at the time when the sale agreements were entered into ? - By executing the sale deed in June, 2005, the assessee has only completed the contractual obligation imposed upon it by virtue of the sale agreement. Since the process of sale has been initiated from the date of sale agreements, in our opinion, the character of the transaction vis-à-vis Income tax Act should be determined on the basis of the conditions that prevailed on the date the transaction was initially entered into. Accordingly, the applicability of the provisions of section 50C should be looked at only on the date of sale agreement.
The assessee has filed a certificate obtained from the Joint Sub Registrar, Visakhapatnam, regarding market value of the impugned property as on the date of the sale agreements. The said certificate was not produced before the tax authorities.
As held provisions of section 50C should be applied to the impugned sale transactions as on the date on which sale agreements were entered into. Since the applicability of section 50C as on the date of sale agreements is required to be examined by the AO, we set aside the issue to the file of the AO with a direction to compute the capital gains on sale of impugned properties after applying the provisions of section 50C as on the date of sale agreements. Accordingly, the order of Ld CIT(A) is reversed. Appeal of the assessee allowed for statistical purposes.
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2010 (6) TMI 769 - ITAT MUMBAI
Deduction u/s 54F - Deduction denied as capital gains is bogus - HELD THAT:- Considering the facts of the case, it is to be concluded that the addition has been made by the A.O. without any basis and merely on conjectures and surmises. We also noticed that the learned CIT(A), while confirming the case of the A.O., has referred to certain details not furnished such as purchase and sale of M/s DSQ Software which was squared of against the purchase of the shares of M/s Bolton Properties Ltd. and also the fact that the ultimate buyers of the shares were operating from the same broker's address. These inferences relied upon by the learned CIT(A) in the light of the documentary evidence are not sufficient to come to the conclusion that these transactions of purchase and sale of shares by the assessee resulting in capital gains is bogus.
Not only that the company also transferred the shares in the name of the assessee by issuance of jumbo certificate and ownership of the shares were also recorded in the form of demat account maintained in Bank of Baroda. The member client agreement was also furnished which indicate that the assessee was registered with the broker as per the norms. Under the facts and circumstances of the case, we are of the view that the capital gain as declared by the assessee is to be accepted and the addition made by the A.O. deserves to be deleted. Consequent to that the assessee is eligible for deduction under section 54F. The A.O. is directed to do so. Accordingly the respective grounds are considered allowed.
Addition u/s 69C for the low withdrawals - In the absence of any information on record we deem it fit to restore the issue back to the file of the A.O. to give one more opportunity to the assessee to furnish the necessary details in support of the expenditure. In the absence of any details from the assessee, the A.O. is free to estimate the expenditure keeping in mind the capital account of the assessee in firms and also husband's capital account. With these directions, the issue is restored back to the file of the A.O. Ground is allowed. Appeal partly allowed.
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2010 (6) TMI 768 - KERALA HIGH COURT
... ... ... ... ..... grant of refund, assessee cannot be held to be a defaulter, no matter, without issuing a fresh notice of demand, assessee could be called upon to pay the balance demand arising after Tribunal's order based on original notice of demand issued by invoking the provisions of the Act. Since the original demand is restored only by virtue of the Tribunal's order, the default in payment of ₹ 10,55,613/- starts after Tribunal's order restoring the original demand. So much so, interest under Section 220(2) is payable for the balance demand ultimately sustained for period of default after Tribunal's order. However, no interest could be levied from the date of issue of refund order till date of Tribunal's order. We, therefore, allow the appeal in part directing the assessing officer to revise the demand of interest by excluding the period during which the amount was refunded to the assessee till date of revival of original demand based on Tribunal's order.
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2010 (6) TMI 767 - MADRAS HIGH COURT
... ... ... ... ..... rtment, who was present at the time of loading and who put the seals to the container being a vital one, the non-recording of his statement or the non-furnishing of his statement if such statement was recorded, would have definitely caused prejudice to the detenus besides exhibiting non-application of mind on the part of the detaining authority. 18. For all the reasons stated above, we are of the considered view that the contention of the learned senior counsel for the petitioners in this regard has got to be countenanced and the orders of detention impugned in these petitions are to be held vitiated on the ground of non-application of mind also. 19. In the result, the Habeas Corpus Petitions are allowed and the impugned orders of detention, dated 26.06.2009, passed by the first respondent are set aside. The detenus P.Hameed Mustaq and P.Tamilselvam Kumar are ordered to be set at liberty forthwith, unless their continued custody is required in connection with any other case.
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2010 (6) TMI 766 - CESTAT MUMBAI
Confiscation - redemption fine - the container was loaded on the vessel without obtaining LEO on 21.05.08 and the vessel was sailed on the same day but the LEO was obtained on 22.5.08 - Held that: - the Commissioner has found that the exporter has not faulted or played any role for loading of the container on board the vessel without LEO. The delay on the part of the ship line which rendered the subject goods are confiscated are beyond the control of the exporter but he held as the goods were loaded without permission of the proper officer but goods were liable for confiscation and confiscated the goods - It is well settled law in the case of Shiv Kripa Ispat Pvt. Ltd. (supra) that when the goods are not available and are not exported under any bond, redemption fine cannot be imposed - redemption fine set aside.
Penalty on CHA - Held that: - CHA has acted on behalf of the exporter and in this case the exporter has not been penalized as it was observed that the exporter has not played any role on board the vessel without LEO - Moreover the CHA had informed the shipping line in advance that the documents will be handed over to the shipping line on 22.05.2008 and the only fault of the shipping line, who loaded the vessel without obtaining LEO from the proper officer - penalty on CHA set aside.
Penalty on shipping line - Held that: - it is an admitted fact that the shipping line has loaded the container on the vessel without obtaining LEO by contravening the Custom laws. For such an act, they are liable for penal action - penal upheld.
Appeal allowed - decided partly in favor of appellants.
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2010 (6) TMI 765 - ITAT AHMEDABAD
... ... ... ... ..... h subsequent years to be adjusted against receipts/income of that subsequent year. 9. We have heard the parties and carefully perused the material on record. The issue is covered by the decision of Jurisdictional High Court in the case of CIT vs. Shri Plot Swetamber Murti Pujak Jain Man (supra). Since we have already decided the issue in favour of the assessee in Asst. Year 2006-07, we accordingly follow the same and decide the issue in favour of the assessee this year also. 10. So far grant in aid received from the Government is concerned it is already treated as contribution to corpus in Asst. Year 2006-07 and, therefore, the same has to be excluded from the computation of income under section 11. This issue is also decided in favour of the assessee following our decision in Asst. Year 2006-07 as referred to above. Thus the appeal of Revenue is dismissed. 11. In the result, both the appeals filed by the Revenue are dismissed. Order was pronounced in open Court on 11/6/2010
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