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2012 (12) TMI 1183
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... ... ..... d that all the facts relating to the same have been disclosed by him, the assessee will escape the guillotines of the rigours of this Explanation or for that matter of sec. 271(1)(c) of the Act. 13. In this case, the assessee-company has disclosed all the material facts relating to these expenses. The assessee-company bona fidely believed that these expenses can be claimed towards business expenses. The learned CIT(A) has even accepted this proposition by deleting these expenses. The AO has not and cannot come to a conclusion in the given facts of the case that claim is false. Thus, neither the assessee-company has concealed particulars of income nor it has furnished inaccurate particulars of its income. Accordingly, on merits also, no penalty under sec. 271(l)(c) is leviable and is liable to be deleted. As a result, we order to delete the impugned penalty in toto, and allow the appeal of the assessee-company. 14. In the result, this appeal of the assessee-company is allowed.
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2012 (12) TMI 1182
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... ... ..... under review. The High Court and the Supreme Court would be powerless to interfere so as to keep the administrative officer within the limits of the law. The result would be that the power of judicial review would be stultified and no redress being available to the citizen, there would be insidious encouragement to arbitrariness and caprice. If this requirement is insisted upon, then they will be subject to judicial scrutiny and correction.” 7. If we look at the order of Ld DRP extracted (supra) in the light of above proposition, it will reveal that DRP has not applied its mind. The assessee had filed objections running into several pages and not a single objection has been discussed by the Ld DRP. Therefore, we set aside the order of Ld DRP and remit the issue back to the file of Ld DRP for re-adjudication. 8. In view of the above, the appeal filed by the assessee is allowed for statistical purposes. 9. Order pronounced in the open court on 14th day of December, 2012.
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2012 (12) TMI 1180
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... ... ..... tate, particularly with reference to the provisions of Article 5(e)(i) and Explanation (ii) of the Karnataka Stamp Act, 1957, we set aside the order of the Division Bench impugned in these appeals and remit the same to the High Court for fresh consideration. We request the High Court to restore W.A. Nos. 1023, 1324 and 1325 on its file and dispose of the same on merits in accordance with law, after affording opportunity to all the parties including the newly impleaded respondent Nos. 4-32 herein as well as the connected writ petitions pending before the High Court, preferably within a period of six months from the date of receipt of copy of this judgment. Once again, we make it clear that except adverting to the stand of the State, we have not expressed our views on any of the claims and it is for the Division Bench of the High Court to consider their respective claims in accordance with law as observed supra. 10) The appeals are allowed. There shall be no order as to costs.
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2012 (12) TMI 1179
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... ... ..... on different footings and are not relevant for deciding the issue before us. Further the reliance placed by the learned A.R. for the assessee on the ratio laid down in CIT Vs. Arisudana Spinning Mills Ltd. (supra) in respect of non allowance of deduction claimed under section 80IA of the Act on account of different legal propositions vis-à-vis the deduction claimed. The said ratio is not applicable to the facts of the case before us where admittedly the surrendered income was offered by the assessee as additional income and thereof deduction under section 80IB of the Act was denied to the assessee on such surrendered income. The deduction under section 80IB of the Act was claimed. In the totality of the facts and circumstances, we uphold the levy of penalty u/s 271(1)(c) of the Act. The ground of appeal raised by the assessee is thus dismissed. 14. In the result, the appeal of the assessee is dismissed. Order Pronounced in the Open Court on 6th day of December, 2012.
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2012 (12) TMI 1178
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... ... ..... at the ld. CIT(A) has rightly deleted the disallowance made by the AO as the interest on sales tax was a compensatory in nature and not a penal in nature. We further find that the ratio of decision as relied by the ld. CIT(A) in deleting the disallowance made by the AO is squarely applicable to the facts of the present case. Therefore, the same is upheld. The ground taken by the department is hereby dismissed. 4. We further find that in the impugned order passed by the ld. Commissioner, Commissioner has merely followed the above observations and decision taken by the Coordinate Bench. In this view of the matter, and respectfully following the decision of the Coordinate Bench of this Tribunal in assessee’s own case for the assessment year 2002-03, we see no reason to interfere in the impugned order. We accordingly confirm and uphold the same. 5. In the result, the appeal filed by the Revenue is dismissed. Order pronounced in the open Court on 28th day of December, 2012.
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2012 (12) TMI 1177
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... ... ..... Special Metropolitan Magistrate dated 5th January 2010. 4. Reading the complaint as a whole, the cheques were issued to the Complainant at Delhi. The transaction has taken place at Delhi. Even the Accused has the business transaction at Delhi. The cheques were drawn on Federal Bank, New Delhi, presented to the Bank at New Delhi. It was returned unpaid by the drawee Bank at New Delhi. Only issuance of demand notice through the Counsel at Mumbai could be said to be one of the transaction taken place at Mumbai. The order of the learned Metropolitan Magistrate dated 5th January 2010 passed below Exhibit 16, does not call for interference as the legal position is well indicated in the matter of National Small Industries Corporation v/s. Hermeet Singh Paintal & Anr. reported in (2010) 3 SCC 330 and in the matter of Mrs. Preetha S. Babu v/s. Voltas Ltd. & Anr. (2010) All MR (Cri) 1025, decided by the Division Bench of this Court. Both Petitions allowed. (K.U. CHANDIWAL, J.)
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2012 (12) TMI 1176
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... ... ..... ed to delay the proceedings and initiated the proceedings one after another and even subsequently filed three petitions challenging the order of detention dated 11.06.1976 though the Special Civil Application No. 3716 of 1995 was dismissed. As stated hereinabove, even though the proceedings under the SAFEMA have been initiated as far as back in the year 1977 because of various proceedings initiated by the appellants one after another, the proceedings under the SAFEMA are not permitted to reach to its conclusion even after a period of 35 years. Under the circumstances, present Letters Patent Appeal is dismissed with aforesaid cost. Cost to be deposited with the Registry within four weeks from today and on such deposit the same be transmitted to Gujarat High Court Legal Aid Committee. CIVIL APPLICATION NO. 4547 OF 1997 In view of dismissal of main Letters Patent Appeal, no order is required to be passed in Civil Application No. 4547 of 1997 and same is disposed of accordingly.
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2012 (12) TMI 1175
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... ... ..... R that the cost of acquisition of the property would be the market value of tenancy right as on 04.03.2003 plus the sum of ₹ 45,062 paid by the assessee to Government. We however did not agree with the submission of Ld.AR that the cost of acquisition would be the market value of property as on 04.03.2003, because the property had been acquired under the scheme of Government which would not necessarily be at market price. Though the assessee had submitted the valuation report regarding market value of tenancy right, before CIT(A) the same remained unexamined. We therefore, set aside the order of CIT(A) and restore the matter to the file of Assessing Officer for passing a fresh order after necessary examination of the cost of acquisition in the light of our observations made above and after allowing a reasonable opportunity of being heard to the assessee. 6. In the result, the appeal is allowed for statistical purpose. Order pronounced on this 19th day of December, 2012.
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2012 (12) TMI 1174
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... ... ..... has occurred in the mean- while. Subject to this, the writ petition will stand dismissed. 13. In so far as W. P. (C) No. 28685 of 2009 is concerned, exhibit P15 is the penalty order against which the petitioner has already availed of the appel- late remedy by filing exhibit P23 appeal. Therefore, no order as in the case of leading case is warranted. For the aforesaid reasons, this writ petition is dismissed. 14. In so far as W. P. (C) No. 32917 of 2009 is concerned, the petitioner, inter alia, challenges exhibits P12 to P14 penalty orders passed against them. Although on merits, the issue is fully covered by the judgment in W. P. (C) No. 5623 of 2009, since the writ petition was entertained and was pending in this court, it is directed that it will be open to the petitioner to pursue the appellate remedy against the aforesaid orders. If such appeals are filed within one month from today, that will be considered by the appellate authority ignoring the delay that is involved.
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2012 (12) TMI 1173
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... ... ..... 994 (1) SCC 243, the Supreme Court observed that when the court directs payment of damages or compensation against State, the ultimate sufferer is the common man. It is the tax payers' money, which is paid for action of those who are entrusted under the Act to discharge their duties in accordance with law. We are inclined to keep this reality in our mind also. Therefore, we make it clear that it will be open to the Government to recover the amount, which is directed to be paid immediately by the first respondent, from respondents 5 to 7, after due enquiry and investigation. Considering entire facts and circumstances of the case, we feel that an award of compensation of ₹ 50,000/-, the relief which is prayed for, is just and proper to meet the ends of justice. We direct the first respondent to pay a compensation of ₹ 50,000/- (Rupees fifty thousand only) to the petitioner within one month from the date of the judgment. The writ petition is allowed accordingly.
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2012 (12) TMI 1172
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... ... ..... s the approval of the banks and financial institutions, the same may cause irreparable injury not only to the appellant Company but also to other creditors, workers and others associated with the business of the appellant company. 7. We accordingly modify the interim order dated 13th December, 2012 by permitting the appellant Company to execute the Master Restructuring Agreement under the CDR process aforesaid and on the terms as disclosed in the memorandum of appeal, though with a clarification that the additional/new encumbrances created by the appellant Company under the CDR process shall be without prejudice to the rights of the respondent and subject to further orders that may be passed by the learned Company Judge. On request of the senior counsel for the respondent it is further ordered that the parties to the agreement shall not claim any equities. In view of the above, the appeal stands disposed of. A copy of the order be given dasti under signature of court master.
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2012 (12) TMI 1171
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... ... ..... uo;s premises although they received the payments in advance and hence the dealer’s premises are the place of removal. This is a factual aspect to be verified in respect of each of the agreements because we find that some agreements indicate that the delivery will be made by the appellant at the dealer’s premises which others are silent on this point. 5. In this factual matrix, we find it is a fit case to remand all these matters back to the Original Adjudicating Authorities to verify as to when sale has to be taken place in terms of the Board’s circular (supra) and determine their eligibility of CENVAT credit under CCR, 2004. The appeals are allowed by way of remand to the original adjudicating authorities with a direction to examine the matter in terms of CBEC circular and as per the agreements entered into by the appellants with their dealers and pass orders after following the principles of natural justice. (Order pronounced on 20/12/2018 in open court)
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2012 (12) TMI 1170
Market Price of the suit property - Execution of sale Deed - Decree for Specific Performance - Bar of limitation - The plaintiffs have invoked the provisions of Section 15 (5) of the Limitation Act, 1963 to claim the benefit of the exclusion of the period during which the defendant was absent from India. There can, indeed, be no doubt that if the plaintiff is entitled to exclude the period of such absence the bar of limitation will not apply to the present suit.
Whether Decree for Specific performance should be granted at the belated time of agreement. HELD THAT:- The long efflux of time (over 40 years) that has occurred and the galloping value of real estate in the meantime are the twin inhibiting factors in this regard. The same have to be balanced with the fact that the plaintiffs are in no way responsible for the delay that has occurred and their keen participation in the proceedings till date show the live interest on the part of the plaintiffs to have the agreement enforced in law. Therefore, to direct specific performance of an agreement and that too after elapse of a long period of time, undoubtedly, has to be exercised on sound, reasonable, rational and acceptable principles. The parameters for the exercise of discretion vested by Section 20 of the Specific Relief Act, 1963 cannot be entrapped within any precise expression of language and the contours thereof will always depend on the facts and circumstances of each case. It must be emphasized that efflux of time and escalation of price of property, by itself, cannot be a valid ground to deny the relief of specific performance. After consideration to all relevant aspects of the case for the ends of justice would require this court to intervene and set aside the findings and conclusions recorded by the High Court and to decree the suit of the plaintiffs for specific performance of the agreement. further sale deed that will now have to be executed by the defendants in favor of the plaintiffs will be for the market price of the suit property as on the date of the present order. As no material, whatsoever is available to enable us to make a correct assessment of the market value of the suit property as on date, Apex court request the learned trial judge of the High Court of Delhi to undertake the said exercise with such expedition as may be possible in the prevailing facts and circumstance.
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2012 (12) TMI 1169
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... ... ..... to Section 53 and Sections 53A and 311A were inserted into the Code. Voice sample was not included either in the Explanation to Section 53 or Section 311A. 93. Should the Court still insist that voice sample is included in the definition of "measurements" under the Identification of Prisoners Act and in the Explanation to Section 53 of the Code of Criminal Procedure? I would answer in the negative. 94. In light of the above discussion, I respectfully differ from the judgment proposed by my sister Desai J. I would allow the appeal and set aside the order passed by the Magistrate and affirmed by the High Court. 95. Let copies of this judgment be sent to the Union Law Minister and the Attorney General and their attention be drawn to the issue involved in the case. 96. In view of the difference of opinion between us, let this case be listed for hearing before a bench of three Judges after obtaining the necessary direction from the Honourable the Chief Justice of India.
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2012 (12) TMI 1168
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... ... ..... o the AO or the ld. CIT(A) has not brought any comparable case for application of NP rate of 8%. The Ld. counsel for the assessee, Mr. P.N.Arora has brought on record decisions of ITAT Amritsar Bench in the case of ITO vs. Surinder Pal Nayyar, contractors, passed in ITA No.366(Asr).2010, order dated 30.04.2012 where NP rate of 5% is applied and in the case of Sh. Mohan Singh Contractor vs. ITO passed in ITA No.59(Asr)/2012, dated 5th June, 2012, where also NP rate of 5% has been applied. Therefore, considering the irregularities in the books of account mentioned above, the AO is directed to apply NP rate of 5% on the net contract receipts declared by the assessee and further directed to delete the addition made of ₹ 1,26,64,682/-. The assessee gets part relief accordingly. Thus, the appeal of the assessee is partly allowed. 11. In the result, the appeal of the assessee in ITA No.450(Asr)/2012 is partly allowed. Order pronounced in the open court on 27th December, 2012.
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2012 (12) TMI 1167
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... ... ..... s of the case in the light of the judgement of Delhi High Court in the case of Lovely Exports Pvt. Ltd. (supra), then it will be noticed that the assessee has given the identity of the subscribers but genuineness of the transaction and creditworthiness of the transaction is not established. Being so, In our opinion, the deletion of addition by the CIT(A) is not justified. 10. In our opinion, in spite of opportunities given, the assessee having failed to prove the genuineness and creditworthiness of the parties, the addition is to be sustained. We place reliance on the judgement of Delhi High Court Full Bench in the case of CIT vs. Sophia Finance Ltd. (204 ITR 98) and also on the order of the Delhi Bench in the case of Ekta Agro-Industries Ltd. v. ITO (8 DTR 239) (Delhi). Accordingly, the order of the CIT(A) is reversed and that of the Assessing Officer is restored. 11. In the result, appeal of the Revenue is allowed. Order pronounced in the open court on 20th December, 2012.
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2012 (12) TMI 1166
Comparable selection - Determination of the arm's length price - export incentives received for sales of export of finished goods - reduction of export incentive from goods sold - TPO held that export incentive cannot be deducted from cost of goods sold - Assessee during the relevant previous year, inter-alia, entered into international transactions of export of finished goods to its associated enterprises, comprising of export of manufactured products and export of traded products. The assessee has purchased finished goods, viz., certain varieties of tyres from Good Year South Asia Tyres Pvt. Ltd. (GSATL) for export to the associated enterprises (AEs) - appellant follows a similar economic model for pricing its exports, be it exports of manufactured goods or traded goods.
HELD THAT:- We find that the reasoning adopted by the TPO has considerable cogency. The export benefits are given to the taxpayers to promote and stimulate the growth of exports of goods and services in India. They are also meant to earn valuable foreign exchange for the country. The export incentive was available to the assessee only after trading exports made by the assessee. Global Transfer Pricing policy of the group company mentions cost in inter company transfer before the goods and services are dispatched from the premises of a company to the other company. In the Global Transfer Pricing Policy the future value of benefits which may be available in a few countries cannot be included as this will disturb the very basis/purpose or providing uniform return to teach and every enterprise which is a member of global transfer pricing policy. The very purpose of global transfer pricing is to provide a minimum amount of return to the members of global transfer pricing policy.
The assessee who is involved in controlled transaction this approach actually results in transferring, benefit from Government granted incentives to AE. Moreover, the entities transfer pricing policy cannot override the basic fundamental of transfer pricing analysis. If assessee’s method of calculation of cost of goods sold is followed, it would tantamount to a claim of benefit, which has not yet accrued at the time of sale of goods, being treated as a component of cost of goods sold.
TPO has rightly observed that export incentives does not form part of the invoice price of goods sold. In such a case, it cannot be reduced from the cost of goods sold. We agree with the TPO that an expenditure that does not form part of the books of accounts cannot be treated as an expense for the purpose of transfer pricing accounting.
Hence, we are of the opinion that TPO has rightly held that export incentive cannot be deducted from cost of goods sold.
Deduction of rebate /discount - We find that as per the agreement assessee is entitled for rebate of 3% on cost of goods purchased for exports to AE as well as to unrelated parties. We find that the above reasoning adopted by the AO in disallowing the deduction is not cogent. That the assessee has not made any such claim initially cannot act as estoppel against the proper and valid claim. We agree with the ld. Counsel of the assessee company that the rebate received is inextricably linked with the cost of purchase. We further note that in subsequent assessment years for AY 2007-08 and 2008-09 the TPO has accepted the contention of the assessee that the rebate received upon purchase of goods is deductible from the value of cost of goods sold. Hence, in our considered opinion, assessee is entitled for deduction of rebate received upon purchase of goods from the value of goods sold.
We further find that the rebate amount was netted off and net amount of purchase cost shown in the profit and loss account. In this regard, TPO has contended that the said amount was not reflected in the books and accounts of the assessee. In our considered opinion, this factual aspect needs verification. Hence, we remit this issue regarding verification of netting off of rebate from cost of purchase to the file of AO. Needless to add that the assessee should be given adequate opportunity of being heard.
Disallowance on machinery repair and maintenance - HELD THAT:- We find that on this issue AO has made an adhoc disallowance of 20% of the expenditure incurred on machinery repair and maintenance on the premise that the same is capital expenditure. AO has not identified as to which items in his opinion are in capital expenditure. In this regard, we also note that such adhoc disallowance were also made by the AO in the preceding years in the case of the assessee. But the Delhi Tribunal in assessee’s own case for AY 2003-04 and 2004-05 upheld the order of the Ld. CIT (A) deleting the similar disallowance of expenditure out of repair and maintenance expenses for plant and machinery.
We also note that Revenue has not filed any appeal before the High Court of Delhi against the aforesaid order passed by the Tribunal. Hence, we set aside the order of the AO and decide the issue in favour of the assessee.
Claim towards provision for warranty - AO disallowed provision for warranty by holding that the said liability was an uncertain contingent liability - HELD THAT:- We agree with the assessee’s contention that provision for estimated expenditure to be incurred for warranty obligation in respect of sales made in the relevant previous years is to be accounted as expenditure in the year of sale, in order to match the cost with revenue. The provision for warranty is necessarily required to be made by the companies which are required to follow mercantile system of accounting. In this regard, we further find that Courts have consistently held the view that liability for provision for warranty for replacement on account of manufacturing defects arises at the time of sale and is to be allowed as deduction in that year on the basis of rational /scientific estimate, notwithstanding that the exact amount of liability is ascertained at a later date.
Hence, we hold that provision for warranty made by the assessee is allowable. Hence, we set aside the order AO on this issue.
Claim on excise duty - disallowed in AY 2005-06 - During the present year out of the AY 2005-06 excise duty has been paid during this year. Hence, it has been claimed that the same should be allowed in terms of section 43B of the I.T. Act - AO held that for want of proper break-up and other details a sum was paid as excise duty, after the due date, is again disallowed, as per the provisions of section 43B.
HELD THAT:- We agree with the assessee’s counsel contention that AO has not properly dealt with this claim of the assessee. Assessee’s claim is that in terms of section 43B the excise duty on closing stock disallowed in the preceding previous year and paid during the relevant previous year should be allowed as deduction. The claim needs factual verification, hence, we remit this issue to the file of the AO.
In the result, the appeal filed by the Assessee is partly allowed.
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2012 (12) TMI 1165
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... ... ..... pplied their mind to these obvious and very important infirmities. However, we find it is the duty of the assessee to file proper confirmation letters not only confirming the opening and closing balances but also giving the full particulars of the transactions reported in the year as well as the full signature of concerned creditors and not his accountants, who is not duly authoritised. In any case, Ld AR made a statement at Bar for removal of these infirmities before the AO, if a chance is granted. Otherwise, the loan creditors are assessed to tax and their credit worthiness was never doubted by the AO. Subjected to the removal of these deficiencies, thus, we agree with the AO who accepted the unsecured loan/refunds claimed by the assessee as genuine and the unsecured loans and the refunds of them constitutes the source of the cash deposits. 28. In the result, the appeal of the assessee is partly allowed. Order pronounced in the open court on this 5th day of December, 2012.
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2012 (12) TMI 1164
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... ... ..... ms the Court that he has already taken consent from Sri Diptiman Singh and Sri Sikandar B. Kochar to act as Chairman and Alternate Chairman for the meeting of equity shareholders of the company. In view of this, this Court appoints Sri Diptiman Singh, Advocate as Chairman and Sri Sikandar B. Kochar as Alternate Chairman for the said meeting. The date, time and venue of the meeting shall be published in two newspapers namely Pioneer in English and Amar Ujala in Hindi. The notice shall indicate that the meeting shall be held on 27.1.2013 at 11 a.m. at the registered office of the company in Kanpur. The remuneration for the Chairman is fixed at ₹ 60,000/- and that of the Alternate Chairman shall be ₹ 40,000/-. The payment shall be made to them in advance. The company will also bear the actual expenses of their travel and stay at Kanpur. The Chairman shall submit his report within ten days from the date of the meeting. List this matter on 15.2.2013 before this Court.
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2012 (12) TMI 1163
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... ... ..... this Court. The Court shall be free to examine them by exercising the powers under section 311 of the Code and section 165 of the Evidence Act. The Court shall also grant an opportunity to the appellants, as well as to the prosecution to examine or cross-examine these witnesses, as the case may be. (vi) After considering the evidence of PI Wadke and further evidence of the Investigating Officer Sadashiv L. Patil, as may be adduced, the Trial Court may consider the prayer of the appellants to issue a search warrant to search for and seize the relevant documents and produce the same before the Court, afresh, as may be required by the appellants. 61. Certified true copies of the Affidavits filed by P.I. Wadke and Investigating Officer S.L. Patil in this court, be forwarded to the trial court, along with the writ of this order. 62. The Trial court shall proceed further with the trial expeditiously. Both the appeals are allowed in the aforesaid terms and to the aforesaid extent.
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