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Showing 441 to 460 of 915 Records
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2010 (7) TMI 791 - ITAT MUMBAI
Bad debts, Guest house expenses ... ... ... ... ..... the Tribunal, we hold that the artificial disallowances imposed by the Income-tax Act under the above mentioned sections are not permissible. This ground is allowed. Respectfully following the aforesaid decisions of the Tribunal, we delete the disallowances made by the Assessing Officer and confirmed by the ld. CIT(A) U/R 6-B, Rule 6-D and section 43-B and also on account of entertainment expenses and guest house expenses and allow ground No. 5 of assessee rsquo s appeal. 72. The appeal of the assessee being ITA No. 6021/Mum./2000 for assessment year 1996-97 is treated as allowed as indicated above. 73. In the result (1)Appeals of the assessee being ITA No. 1670/Mum./01 and ITA No. 6021/Mum./2000, and appeal of the revenue being ITA No. 1187/Mum./01. are partly allowed. (2)Appeals of the assessee being ITA No. 6658/Mum./02 and 6659/Mum./02 are treated as allowed as indicated therein. (3)Appeals of the revenue being ITA No. 7047/Mum./02 and ITA No. 7052/Mum./02 are dismissed.
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2010 (7) TMI 790 - ITAT MUMBAI
Double taxation relief - Where agreement exists ... ... ... ... ..... ue already remitted to the record of the CIT(A), this issue raised by the assessee is also remitted to the record of the CIT(A) for adjudication afresh. 22. The third ground of appeal is regarding rate of Income-tax applicable in the case of the assessee. 23. We have heard both the parties and considered the relevant record. We find from the record that this issue was considered and adjudicated upon by this Tribunal in assessee rsquo s own case for the assessment year 2001-02 in paragraph 16 of order (supra) which has been reproduced in paragraph 10 of this order. 24. So far as the issue of PE and taxability of income is concerned, while deciding the appeal of the revenue, we have restored this issue to the file of the CIT(A) in the appeal of the revenue. Accordingly, this issue has been remitted to the file of the CIT(A) for fresh adjudication as the same is dependent on the outcome of the other issues. 25. In the result, both the appeals are allowed for statistical purpose.
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2010 (7) TMI 789 - ITAT AHMEDABAD
Depreciation - Unabsorbed depreciation, Cash credits ... ... ... ... ..... , their creditworthiness and genuineness of the transaction. The assessee has admittedly filed only confirmation of the creditors before the Assessing Officer and no evidence of their creditworthiness for giving loans have been admittedly filed. Since the amounts have been given in cash and the creditors were not assessed to tax, therefore, the authorities below rightly inferred that the transaction is not genuine. In the absence of any evidence of their source of income to give loan and in the absence of any evidence of the creditworthiness of the creditors, the authorities below were justified in making the addition. Mere filing of confirmation would not prove genuine credit. The assessee has, thus, failed to discharge the onus upon him to establish genuine credit. We, accordingly, confirm the findings of the authorities below and dismiss this ground of appeal of the assessee. 14. No other point is argued or pressed. 15. As a result, the appeal of the assessee is dismissed.
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2010 (7) TMI 788 - CESTAT, NEW DELHI
Cenvat credit - Whether credit can be allowed on the basis of debit entry in the cenvat credit account – Held that:- payment of service tax was not made through challan instead the payment was made through debit entry in the cenvat credit account and the debit entry in the cenvat credit account was made on the basis of LR i.e. Lorry receipt received by the respondents from the transporter. LR has all the details showing the name of consignor and consignee, serial number and in the note below it is stated that the service tax to be paid by the consignee. Therefore, the details mentioned in the LR provided all the required information. Departmental appeal is dismissed.
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2010 (7) TMI 787 - PUNJAB AND HARYANA HIGH COURT
Deletion of unexplained cash credit and unexplained investment - CIT(A) and ITAT deleted the addition - held that:- Revenue made strenuous efforts to persuade this Court to re-appreciate the evidence and record fresh conclusion on the basis thereof. But the counsel could not point out any mis-reading or mis-appreciation of evidence on the basis of which it could be recorded that the findings of CIT (A), which were approved by the Tribunal, were erroneous or perverse in any manner. The view taken by the authorities below is plausible view based on appreciation of evidence available on record. No exception can, therefore, be taken to said findings.
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2010 (7) TMI 786 - PUNJAB AND HARYANA HIGH COURT
Whether Tribunal was right in law in upholding the order of the first appellate authority deleting the addition made as income from undisclosed sources on account of difference between the cost of construction declared by the assessee and that estimated by the DVO - Departmental Valuation Officer (in short "the DVO") estimated the cost of construction at Rs. 8,89,540. The assessee also got the services of a registered valuer who estimated the cost at Rs.4,56,900 but the Assessing Officer adopted the valuation made by the DVO - Revenue submitted that even incomplete construction had the valuation and, therefore, the Tribunal was not justified in holding that in case of incomplete construction, the reference to the DVO was premature – Held that:- According to sub-section (3), the Assessing Officer on receipt of report from the Valuation Officer may take the same into consideration while making assessment or reassessment after providing an opportunity of being heard to the assessee. However, a proviso has been added, according to which this section shall not apply in respect of an assessment made on or before September 30, 2004, where such assessment has become final and conclusive on or before that date except in cases where a reassessment is required to be made in accordance with the provisions of section 153A.
Section 142A of the Act is not attracted to the facts of the present addition sought to be made on the basis of report of the DVO cannot legally be done. decision against the Revenue and in favour of the assessee.
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2010 (7) TMI 785 - PUNJAB AND HARYANA HIGH COURT
Share dealing transactions - Addition on account of unaccounted commission earned by the assessee on share dealing transactions - Claim of the assessee that it was receiving only 1.50% commission on long term transactions and 0.30% commission on total transactions was duly considered – Held that:- assessee itself surrendered additional income was also taken into account which fact itself shows that the initial declaration of income of the assessee was not genuine. In absence of genuineness of the stand of the assessee, the Tribunal held that rate of 0.75% to the gross turnover would be a fair assessment, appeal is dismissed
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2010 (7) TMI 784 - PUNJAB AND HARYANA HIGH COURT
Whether ITAT was justified in adopting the rate of land at Rs. 70/- per sq. yd. being the basic allotment rate by the Housing Board as against the rate of Rs. 1260/- per sq. yd. as adopted by Registered Valuer - plea of the assessee was that the cost of acquisition should be calculated at the rate of Rs. 1260/- per square yard as against Rs. 70/- per square yard applied by the Assessing Officer. The assessee relied upon the valuation report from a registered valuer and submitted that the allotment rate does not reflect the fair market value – Held that:- It was not incumbent upon the Assessing Officer or the appellate authorities to have accepted the report of the registered valuer merely because there was no other evidence to rebut the report of the registered valuer, No specific instances were produced by the assessee, finding of the CIT(A) as well as the Tribunal, against the assessee cannot be held to be a perverse finding, appeal is dismissed
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2010 (7) TMI 783 - SUPREME COURT
Concessional rate of sales tax - goods - The Assistant Commissioner, Commercial Tax came to the conclusion that the concession has been extended to non-taxable goods also and formed an opinion that the concession is applicable only to "goods" and newspaper was not a "goods" within the meaning of section 2 of the Act. - Kerala General Sales Tax Act, 1963 - held that:- The matter is remanded to the High Court for consideration afresh in accordance with law on both the aforesaid submissions while leaving all the contentions of the assessee and the Department open for the year 2000-01, in relation to imposition of penalty under section 45A of the Act.
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2010 (7) TMI 782 - PUNJAB AND HARYANA HIGH COURT
Whether Tribunal was right in law in allowing depreciation on foreign cars in view of the provisions of section 32(1)(ii) – Held that:- purpose of exclusion by way of proviso of claims for depreciation of imported cars incorporated by the second proviso to Section 32 (1)(ii) of the Act was not to deny depreciation on foreign cars used in foreign countries for business abroad. It cannot be denied that cars used for business abroad at a foreign site is eligible for claiming depreciation, but for the proviso. There is no justification to read the proviso as excluding the said benefit which is otherwise a legitimate claim, claim of the assessee for depreciation on foreign cars used at foreign sites for its business is clearly admissible. decision against the revenue and in favour of the assessee Whether Tribunal was right in law holding the construction business as industrial undertaking and allowing deductions u/s 80J & 80-HH when the different courts have held contrary to that – Held that:- activity of the assessee, as already mentioned above, is construction and fabrication of mechanized houses, which cannot be equated to manufacture and production of articles or things, questions referred have to be answered in favour of the revenue and against the assessee. The assessee was not entitled to deduction under Sections 80J and 80HH of the Act
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2010 (7) TMI 781 - KARNATAKA HIGH COURT
Extension of period of retaining Books of account - Assessing Officer can retain the books of account only for 15 days. The outer limit can be crossed with the prior approval of the higher authority and for relevant reasons and for reasonable period and not for indefinite period. The reasonable period that can constitute an outer limit is 15 days and, therefore, the extended period can supplement the normal 15 days period statutorily fixed by a few more days and not by a few months or a few more years - Held that:- learned single judge was justified in entertaining the writ petition, issuing a direction to return the books of account, appeal is dismissed
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2010 (7) TMI 780 - MADRAS HIGH COURT
Winding up - huge amount is due from the respondent, since the respondent-company had stopped the manufacturing process – Held that:- agreements entered into with the approval of the secured creditors, the manufacturing process of the respondent-company was allowed to commence on supply of materials by the applicant with the main intention that the applicant which is one of the creditors has to receive large amounts from the respondent and therefore, not only public interest is involved in the said agreements, but the agreements also work for the betterment of the respondent-company and its creditors, particularly, the secured creditors since the agreements gave scope for revival of the respondent-company and ultimately, in that event, it would result in the dismissal of the company petition itself, application stands allowed
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2010 (7) TMI 778 - DELHI HIGH COURT
Whether Tribunal onus was on the assessee to establish the source of receipt shown to have been received as sales proceeds and in upholding its assessment as assessee's income from the undisclosed sources - Assessing Officer took the view that M/s Sandeep Wire Industries is not traceable and a non-existing entity, therefore, no sale was made to the said firm – Held that:- assessee had taken this specific plea, in the alternative i.e. without prejudice to his contention that the sales were actually made and the receipt should not have been received as income from undisclosed sources before the CIT(A) as well as Income Tax Appellate Tribunal, plea was rejected by both these authorities observing that in order to accept this plea further evidence was required to be produced which was in the knowledge of the assessee, assessee was maintaining that it had actually made the sales, Assessing Officer did not deal with the issue from this angle at all and such a reasoning adopted by the CIT(A) and ITAT was based on surmises and imagination, Reference in favour of the assessee and against the Revenue
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2010 (7) TMI 776 - DELHI HIGH COURT
Revival/restructuring of company - meetings of inter-corporate depositors ('ICDs') and staff creditors were held and the scheme was approved by the staff creditors unanimously and by ICDs by a majority of more than 3/4ths - three persons filed their objections, namely, S.K. Modi Group, Malanpur Steel Ltd. and Paradise Credit (P.) Ltd - objection of the Malanpur was that it is a decree-holder and is, thus, wrongly classified as ICD and it should have been classified as a decree-holder and the decretal amount should have been treated at the principal amount - contention of Malanpur that it was a secured creditor of the company and, therefore, it had right to get the entire decretal amount - Other objection of Malanpur, that as per the scheme even the payment of first instalment had been made upon conditional withdrawal of suits and other criminal complaints filed under section 138 of Negotiable Instruments Act, 1881 ('NI Act') and undertaking from respective creditors to support reorganisation in the capital structure of the company - Merely because certain shares were pledged with the Malanpur, would not make it a secured creditor - whether a decree-holder stands at the same footing as that of an unsecured creditor when the matter is before the company court for sanction of a scheme filed by a company - decree-holder in the light of the said section 390(c) of 1956 Act also stands on the same footing as that of an unsecured creditor and it has to be accepted that even after obtaining a decree against the appellant/petitioner by the decree-holder, the respondent herein, shall be deemed to be of the same class as that of other unsecured creditors under the said section - payment would be made to Malanpur Steels Ltd. as per the sanctioned Scheme and once the entire payment is made, Malanpur shall withdraw the proceedings under section 138 of the NI Act which were filed by it alleging non-payment of dues in the form of dishonour of the cheques, review petition bereft of any merit, dismissed
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2010 (7) TMI 774 - BOMBAY HIGH COURT
Demand of service tax and penalty - Air Travel Agent’ service - SCN, alleging that the petitioner-assessee had short-paid service tax - petitioner-assessee had paid service tax voluntarily before the issuance of show cause notice - Benefit of proviso to Section 78 - person, liable to pay such service tax or erroneous refund, as determined under sub-section (2) of section 73, shall also be liable to pay a penalty, in addition to such service tax and interest thereon, if any, payable by him, which shall not be less than, but which shall not exceed twice, the amount of service tax so not levied or paid or short-levied or short-paid or erroneously refunded - Provided that where such service tax as determined under sub-section (2) of section 73, and the interest, payable thereon under section 75, is paid within thirty days from the date of communication of order of the Central Excise Office determining such service tax, the amount of penalty liable to be paid by such person under this section shall be twenty-five per cent of the service tax so determined, assessee claims to have paid service tax much prior to the determination of its tax liability under sub-section (2) of Section 73 - Matter remanded to Adjudicating Authority and directed to consider the question whether or not the petitioner-assessee has discharged its tax liability in terms of the first proviso to Section 78 of the Act. On proper and correct quantification of tax liability under the Act with relevant dates of payments, if the Adjudicating Authority comes to the conclusion that the petitioner-assessee is entitled to the benefit of the first proviso to Section 78, the Adjudicating Authority shall grant the benefit to the petitioner-assessee while quantifying its tax liability, appeal is dismissed
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2010 (7) TMI 773 - PUNJAB AND HARYANA HIGH COURT
Winding up - inability to pay - petitioner relied upon term of the purchase order that 85 per cent of the invoice value shall be paid after 60 days from the date of dispatch but since such payment has not been made, the respondent has failed to discharge contractual obligations - respondent that the UPS unit supplied by the petitioner were defective – Held that:- defence of the respondent cannot be said to be untenable only for the purpose of defeating the claim of the petitioner. There exist serious disputes between the parties in respect of quality of the goods and the time when such defects were rectified. It cannot be said that it is a case of non-payment of admitted liability, petition is dismissed
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2010 (7) TMI 770 - KARNATAKA HIGH COURT
Deemed gift as per the provisions of the Gift-tax Act - Whether capital contribution of Rs. 11,59,375 by the assessee in favour of the partnership firm on 1st April, 1993, and subsequent retirement on August 31, 1993, after four months by receiving a sum of Rs. 22,84,375 the difference of Rs. 11,25,000 cannot be treated as deemed gift as per the provisions of the Gift-tax Act? - Whether the entire transaction was bona fide not for inadequate consideration and consequently does not attract gift-tax liability? - Held that:- As assessee brought their landed properties into the partnership firm. The transaction is not a sham transaction, It is not a case of complete transfer of right of property in favour of the partnership firm. Partnership has admittedly not paid any consideration for such transfer when the properties were brought into the firm. When the partnership firm has not paid any consideration, when the amount mentioned in the books of account is only a notional value and when the partners even after transfer continue to have interest in the property and only on dissolution or retirement, the actual share of a partner could be ascertained and the value of the property is unascertainable on the day they were brought into the partnership firm, the question of holding it as a deemed gift under section 4(1)(a) is impermissible. That is precisely what the Tribunal has held on considering the various judgments on the point. In that view of the matter, no merit in the contention of the Revenue - substantial question of law is answered against the Revenue and in favour of the assessee.
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2010 (7) TMI 769 - GUJARAT HIGH COURT
Undisclosed investment in jewellery - search - Held that:- Central Board of Direct Taxes Circular No. 1916, dated May 11, 1994, lays down guidelines for seizure of jewellery and ornaments in the course of search, the same takes into account the quantity of jewellery which would generally be held by the family members of an assessee belonging to an ordinary Hindu household. The approach adopted by the Tribunal in following the said circular and giving benefit to the assessee, even for explaining the source in respect of the jewellery being held by the family is in consonance with the general practice in the Hindu families whereby jewellery is gifted by the relatives and friends at the time of social functions, viz., marriages, birthdays, marriage anniversary and other festivals. These gifts are customary and customs prevailing in a society cannot be ignored. Thus, although the circular had been issued for the purpose of non-seizure of jewellery during the course of search, the basis for the same recognizes customs prevailing in the Hindu society. In the circumstances, unless the Revenue shows anything to the contrary, it can safely be presumed that the source to the extent of the jewellery stated in the circular stands explained - in favour of assessee.
Gross profit - AO had applied the rate of 10 per cent. for working out the gross profit from trading activity and allowed the deduction at the rate of 5 per cent. towards expenses - Held that:- The gross profit had been merely estimated but there was no basis for such estimation in respect of gross profit or expenses in the assessment order. As whatever income the assessee may have earned from unaccounted business, the same would be held by the assessee as an investment or would have been spent towards personal expenses. During the course of search, no material had been brought on record to prove the investment of such undisclosed amount - Keeping in view the totality of the facts the Tribunal found it appropriate that the gross profit should be adopted at the rate of 5 per cent, on the same set of facts, the Commissioner (Appeals) has worked out the gross profit at the rate of 6 per cent. whereas the Tribunal has adopted the rate of 5 per cent. Thus, the two authorities have on the same set of facts made different estimates. Thus, on these facts, the order impugned does not give rise to a question of law so as to warrant interference because that would only be a case of replacing one estimate by another estimate.
Addition of income from bill discounting – Held that:- AO has estimated the bill discounting income on the basis of cheques being deposited in the accounts of Kamal Trading, Jai Ambe Trading Co. and Arihant Sales Corporation and others & observations of the AO clearly denote that this also relates to the discounting of the cheques, that is why the assessee has deposited the cheques in these accounts. As the figures of these cheques discounted relating to Kamal Trading, Jai Ambe Trading Co. and Arihant Sales Corporation have already confirmed the addition on account of income from the cheque discounting. Therefore, no separate addition can be made estimating as income from the bill discounting - in favour of assessee.
Unexplained expenditure incurred on renovation of house property - Held that:- The expenditure to the extent of ₹ 3.73 lakhs for renovation of the house property had been incurred by Smt. Kantadevi and the said expenditure was disclosed in the return filed by the said Smt.Kantadevi, hence, AO could not have disregarded the same. Besides the expenditure of ₹ 4.92 lakhs incurred by the asses-see is concerned, the assessee had already made a disclosure of the said amount in the total disclosure of ₹ 30 lakhs. In the circumstances, no infirmity can be found in the view taken by the Tribunal in holding that the addition was required to be reduced to the said extent - in favour of assessee.
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2010 (7) TMI 768 - ANDHRA PRADESH HIGH COURT
Whether the DTA unit is liable to pay export duty on goods supplied to a unit within the Special Economic Zone either under the SEZ Act, 2005 or the Customs Act, 1962? - SEZ units submit that, even if the DTA supplier is liable to pay export duty, it should be recovered from them and not from an SEZ unit – Held that:- A conjoint reading of Section 12(1) with Sections 2(18), 2(23) and 2(27) of the Customs Act, 1962 makes it clear that customs duty can be levied only on goods imported into or exported beyond the territorial waters of India. Since both the SEZ unit and the DTA unit are located within the territorial waters of India, Section 12(1) of the Customs Act 1962 (which is the charging section for levy of customs duty) is not attracted for supplies made by a DTA unit to a unit located within the Special Economic Zone.
It is no doubt true that Section 2(m)(ii) of the SEZ Act defines ‘export’ to mean supplying goods from the domestic area to a unit or developer. The SEZ Act, however, does not contain any provision for the levy of customs duty on goods supplied by a DTA unit to a unit located within a Special Economic Zone. The word ‘export’, as defined in Section 2(m)(ii) of the SEZ Act, cannot be interpolated into Section 12(1) of the Customs Act. The Customs Act is a taxing statute and if the said Act does not, by the plain language used therein, carry out the object the Court will not be justified in supplying deficiencies in the Act.
The Drawback, under Rule 3 of the Drawback Rules, is subject to the provisions of the Customs Act and the Rules made thereunder. These Rules also specify certain goods which are not entitled for drawback. The Drawback Rules do not relate to levy and collection of customs duty, and it is only for the limited purpose of claiming drawback would taking out of goods from a place in a Domestic Tariff Area to a Special Economic Zone fall within the definition of “export” under Rule 2(c) of the Drawback Rules, absence of any provision for the levy or collection of customs duty on goods supplied from a Domestic Tariff Area to a Special Economic Zone for its authorized operations, either on the D.T.A. supplier or the SEZ unit, the impugned proceedings whereby the SEZ units were called upon to furnish bank guarantees, and the D.T.A. units were called upon to pay customs duty, are quashed, Writ Petitions are allowed
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2010 (7) TMI 765 - PUNJAB AND HARYANA HIGH COURT
Transfer - whether assets at written down value level valued at ₹ 3,01,700 in exchange of shares valued at ₹ 15,74,874 did not constitute 'transfer' within the meaning of section 2(47) as held by Tribunal ? - Tribunal deleting the addition made by the AO by invoking the proviso to section 41(2) - Held that:- As decided in Kartikeya V. Sarabhai v. CIT [1997 (9) TMI 2 - SUPREME Court] while considering the scope of "transfer" within the meaning of section 2(47) of the Act, where the company had sought to reduce the share capital by reducing the face value of the preference shares, had held the same to be "transfer" under section 2(47) of the Act. Ths the answer to the first question that assets given at the written down value in exchange of shares would amount to 'transfer' within the meaning of section 2(47) of the Act.
Section 41[2] applies wherever the sale proceeds of the capital asset of an assessee exceeds the written down value. The amount that is chargeable to tax under this section is so much of the excess as does not exceed the difference between the actual cost and the written down value. This is taxed as income arising from business or profession of the assessee in the previous year in which the asset is sold. The said charge is termed as balancing charge. This represents the depreciation allowance which is allowed in the previous years from the profits earned by the assessee in those years and where subsequently the capital asset has been sold for excess value, then the difference between the original cost and the written down value is treated as income under section 41(2) of the Act by way of balancing charge.Thus following Chandra Katha Industries’ case [1982 (4) TMI 49 - ALLAHABAD High Court] transfer of assets at written down value for shares of higher value amounts to transfer and attract tax under section 41(2) of the Act. View taken by the Tribunal, thus, cannot be upheld.
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