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2012 (2) TMI 486
... ... ... ... ..... onsideration of the facts and circumstances of the case, rejected the claim made by the writ petitioner. Aggrieved by the said order, the present writ appeal has been filed. 4. Heard the learned counsel for the appellant and the learned Senior Central Government Standing Counsel appearing for respondents. 5. On going through the entire materials placed on record, we see no reason to entertain the writ appeal on the ground that the learned single Judge, after hearing the learned counsel on either side and on consideration of the facts and circumstances of the case and also the authorities relied on by both the parties, has given his extensive consideration in the matter, especially in paragraph Nos. 12, 13 and 14 with regard to the relief to be granted by the High Court under Article 226 of the Constitution of India. 6. In view of the above, the writ appeal fails and the same is dismissed. Connected M.Ps. are closed. However, there will be no order as to-costs.
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2012 (2) TMI 485
... ... ... ... ..... e learned counsel has to fall back upon para 11 of the ROM application. In that para, we have not come across any reference to apparent mistake or error in the Final Order passed by this Bench. 2. Apart from the above, it is also on record that a Civil Appeal was filed by the appellant against the Final Order of this Bench and the same stands dismissed. A copy of the Hon’ble Supreme Court’s order dated 19-7-2010 in Civil Appeal No. 16245/2010 is available on record. The order reads thus “Delay condoned. The civil appeal is dismissed.” 3. The learned counsel fairly submits that the Final Order of this Bench, in its entirety, was challenged before the Apex Court. If that be so, our Final Order stands affirmed by the Apex Court and, therefore, no application for rectification of the alleged mistake in our Final Order can be maintained. 4. In the result, the ‘ROM’ application is dismissed. (Pronounced and dictated in open Court)
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2012 (2) TMI 484
... ... ... ... ..... representative should pass the examination within two years. Counsel submitted that an employee of the appellant wrote the examination several times but failed. However, the appellant got three years and 8 months’ time for the employee to get qualified in the examination. The appellant’s employee repeatedly failed in the examination which led to cancellation of license and declining another temporary license. Even though a person said to be qualified was appointed it was done only after 19-2-2007 which was merely after cancellation of temporary license on 15-2-2007. We do not find any merit in this appeal, consequently the same is dismissed.
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2012 (2) TMI 483
Deduction under section 80IA - Held that:- Even assuming that steam is not power as held by the Assessing Officer, at best the department could have treated only ₹ 11.43 lakhs as ineligible profits for the purpose of claiming the deduction under section 80IA of the Act. To hold otherwise, would be a gross error as the expenditure debited to the profit and loss account of the power unit is still being retained by the department while making the computation. The CIT [A] also agrees that steam has no value as no price was charged for the same in the earlier year but ignores the fact that in the absence of gross total income in the earlier year no exemption could have been claimed. Therefore, we direct that only ₹ 11.43 lakhs is to be treated as ineligible profits for the purpose of deduction under section 80IA of the Act and for the balance sale amount of steam to sugar division, the assessee company is eligible for deduction under section 80IA of the Act.
Addition made towards income in respect of sugar division for value of bagasse not accounted for in that division - Held that:- Separate books are maintained and scrutilized by the assessomg officer in respect of three divisions of the assessee company. There is no evidence that instead of cane trash bagasse has been consumed. Since it is the assessee case that the profits of the power division are exempt under section 80IA of the Act, it does not make sense for the assessee company to reduce profits of the power division by recording spurious purchases of cane trash. Non recording of expenditure actually goes to increase exempted profits. This clearly points to the genuineness of the assessee’s case. The method of accounting followed by the assessee in respect of the sugar and power divisions are the same from year to year. In fact, the sugar division is subject to Central Excise supervision and records are maintained under the Central Excise and Salt Act, 1944. Further the sugar and cement divisions are statutorily required to maintain records under the cost accounting/Audit rules as applicable. Therefore the records should be complete according to all statutory requirements and hence there is no warrant for the department to make any addition without considering the evidence produced by the assessee on this count. After considering the totality of the facts and circumstances, we feel it appropriate to re-examine the issue on the basis of evidence and records maintained by the assessee. Accordingly, we set aside this issue to the file of the Assessing Officer to reconsider the same in the light of our above observations. This ground raised by the assessee is partly allowed.
We are inclined to hold that the power tariff rate should be considered at ₹ 2.67 per unit instead of ₹ 3.48 per unit as decided by the Tribunal in the case of Shri Balaji Bio-Mass Power Project Ltd. (2011 (1) TMI 1405 - ITAT HYDERABAD). Accordingly, we allow the ground taken by the Revenue. However, in the event of tariff rate reached finality by the judgement of higher judicial forum, the Assessing Officer is directed to consider the same and decide accordingly.
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2012 (2) TMI 482
CENVAT credit - whether it was open to the appellant to take credit suo motu of an amount of ₹ 3,63,242/- in their CENVAT account on the ground that they were not liable to pay duty to such extent on their final product by way of reversal of credit? - Held that: - the assessee is not entitled to take credit suo motu of the excess amount paid by them in the absence of any provision in the Central Excise Act or Rules for suo motu taking of credit.
Scope of SCN - Held that: - the original and appellate authorities were proceeding clearly on the basis of the show-cause notice. By mere reason of the fact that these authorities used the expression suo motu, which was not found in the show-cause notice, it cannot be said that they travelled beyond the scope of the SCN.
Appeal dismissed - decided against appellant.
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2012 (2) TMI 481
Interest – provisional assessment - differential duty was paid prior to the date of final assessment - Held that: - the issue decided in the case of COMMISSIONER OF C. EX., NAGPUR Versus ISPAT INDUSTRIES LTD. [2010 (10) TMI 178 - BOMBAY HIGH COURT], where it was held that assessee is not liable to pay interest - appeal dismissed - decided against Revenue.
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2012 (2) TMI 480
... ... ... ... ..... No.1(d), the assessee contended that CIT(A), erred in upholding disallowance of ₹ 68,805/- out of car and telephone expenses. The AO, on perusal of the Profit & Loss Account found that certain expenses had been incurred on car and telephone. The assessee failed to establish that the entire expenses were incurred for the purpose of business.Consequently,the AO disallowed 1/5th of such expenses, towards personal uses, which resulted into addition of ₹ 68,805/-. The CIT(A) upheld the addition made by the AO. 16. Having regard to the factual matrix of the case and non-justification on the part of the assessee that each expense was incurred for wholly and exclusively for the purpose of business, we do not find any ground to interfere with the findings of the ld. CIT(A) and, hence, the same are upheld and ground of appeal of the assessee is dismissed. 17. In the result, appeal of the assessee is partly allowed. Order pronounced in the Open Court on 17th Feb.,2012.
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2012 (2) TMI 479
... ... ... ... ..... ransported. On scrutiny of the bank statement it was observed that out of a total amount of the goods valued at an amount of ₹ 15 crores, 723 cheques of ₹ 8.84 crores were cleared from the accounts of the appellant to the account of M/s. Jindal Stainless Ltd., Hisar. The adjudicating authority recorded finding that there was a well planned act to default the government exchequer for which the company is liable for severe penal action. In the circumstances, we do not find that the CESTAT committed any error in directing the appellant to deposit ₹ 40 lakhs, which is about 1/2 of the total demand as pre-condition for hearing of the appellant. The appellant does not have a good prima facie case and further it has not pleaded any hardship to deposit the amount. 9. The writ petition is dismissed. 10. Learned counsel for the appellant prays for and is allowed one month’s time, in addition to the time allotted by the Tribunal, to deposit the amount.
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2012 (2) TMI 478
Seeking stay of the outstanding demand of tax - Held that:- We are of the opinion that the stay is to be granted in this case on the condition that the assessee shall pay a further sum of ₹ 35.00 lakhs on or before 15-03-2012. The stay shall be in force for a period of 180 days or till the disposal of the appeal whichever is earlier. The appeal is posted for hearing on 04-05-2012. As the date of hearing of the appeal is declared in the open court, no fresh notice need be given.
In the result, the Stay Petition filed by the assessee is allowed.
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2012 (2) TMI 477
... ... ... ... ..... rly, personal penalty was reduced from ₹ 5 lakhs to ₹ 2 lakhs i.e. 40 of the original levy. On facts it is seen that the vehicle imported is a 6000 CC Hummer vehicle which is used by the richest of the rich and the appellant is not the user but only an agent for sale after import to make profit. We therefore, do not find any ground to further reduce the redemption fine and penalty beyond what is granted by the Tribunal, which in our view is very liberal order in favour of the appellant. No question of law also arises for considered by this Court. This appeal is accordingly dismissed.
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2012 (2) TMI 476
... ... ... ... ..... ) and consider whether it is allowable while working out capital gain etc. In case advances to Mr.Rishikumar Chakrapani and also to MPCC consistent with the stand taken in the earlier years, the interest disallowance on the above amount has to be disallowed as there are already findings that the amounts are advanced for non business purposes. To that extent the disallowance of interest stands confirmed. With these directions the issue in this ground is also restored to the file of the Assessing Officer for fresh consideration after examining the facts and according to the law. Assessee should be given an opportunity to make submissions and furnishing the necessary details in this regard. With these directions the appeal is considered as partly allowed for statistical purposes. 10. In the result, assessee’s appeal in ITA No. 933/Mum/2006 is dismissed and other appeals are partly allowed for statistical purposes. Order pronounced in the open court on 24th February, 2012.
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2012 (2) TMI 475
... ... ... ... ..... ppeal is admitted. Tag with Civil Appeal No. 3234 of 2011.
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2012 (2) TMI 474
... ... ... ... ..... f the Tribunal can undoubtedly form the subject matter of an appeal which is available in law. 3. In this view of the matter, we are of the considered view that it would be inappropriate for this Court to exercise its writ jurisdiction under Article 226 of the Constitution when an appeal admittedly lies against the decision of the Tribunal. Though there is no absolute bar to the maintainability of a petition under Article 226, a self imposed rule of restraint requires the Court to relegate the parties to the remedy of a statutory appeal when an appeal is provided under the law. This circumstance is coupled with the requirement of judicial propriety when, in a situation such as the present, the appeal lies before the Supreme Court. We accordingly decline to exercise writ jurisdiction under Article 226 only on this ground leaving it open to the petitioners to pursue the remedy available in appeal. The Petition is accordingly dismissed. There shall be no order as to costs.
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2012 (2) TMI 473
Clandestine removal - it was alleged that appellant were indulged and clearing part of their finished products by issuing private challans and without issuing proper invoices - entire allegation of Revenue is based uopn statements of various persons, pen drive, production reports of lab assistants and Challans and party-wise statements.
Held that: - the directors have accepted their role and that there was a clandestine clearances, the said statement should be considered from the point of the factual matrix of whether the said clandestine removal could be proved from the evidences on record or not.
Retracted statement cannot be relied upon for establishing charge of clandestine manufacture and clearances against the assessee - Hence the statements of buyers and suppliers need to be discarded as evidences.
Evidences relied upon by the Adjudicating Authority on the production reports of the lab assistants, challans and party-wise statements - Held that: - the said challans and production reports of the lab assistants could have no effect on the face of fact that the appellants manufacturing capacity was far less as recorded - when there is no evidence of clandestine manufacture, acknowledgment of the receipt of the goods from the appellants by the buyers, we find that evidences on record do not support the case of Revenue.
The impugned order is not able to establish that there was a clandestine manufacture and clearance of the finished goods from the factory premises of M/s. FPML - appeal allowed - decided in favor of appellant.
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2012 (2) TMI 472
... ... ... ... ..... on the point is proper and just. As such, we hold that before adjudicating the remanded proceedings, a proper show cause notice would be issued by the concerned officer raising the demand, disclosing the reason for the same along with legal provision etc. The appellant would be given an opportunity to put forth their defence and to cause appearance in person. Their appeal is disposed of in the above terms. 7. As regards, the Revenue’s appeal, without going into the legal issue, as to whether the Commissioner (Appeals) has power or not, we find that as we have already directed the lower authority to re-adjudicate the matter after proper observance of process of law, we hold that the impugned order of Commissioner (Appeals) remanding the matter is not to be set aside on the said ground. Accordingly, Revenue’s appeal is rejected. 8. Stay petition as also both the appeals are disposed of in the above manner. (Order dictated and pronounced in the open Court)
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2012 (2) TMI 471
... ... ... ... ..... riod sought to be extended by the exporter or expiry of the reasonable period. 16. Considering the above position, available records and in the absence of any material contrary brought on record it is difficult to accept that the appellants have realised substantial amount outstanding against export proceeds leaving balance of 5 of the total export value. In the light of the above discussion, the appellants have failed to displace the adverse rebuttable presumption under Section 18(3) of the FER Act, 1973. 17. In such a situation, the impugned adjudication order cannot be faulted and this appeal is liable to be dismissed for want of merit. An order is passed accordingly. The appellants are directed to deposit their respective penalty amount within seven days from the date of receipt of this order. In case of failure of appellants in making the payment as aforesaid, the Enforcement Directorate will be entitled to realise the amount of penalty in accordance with law.
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2012 (2) TMI 470
... ... ... ... ..... orized agent” of the person for whom the order is meant for. The Consultant appearing before the Commissioner (Appeals) is authorized only to advance arguments before the appellate authorities and to defend the appellant. There is no authorization to the Consultant for receiving the order in question. Such authorization to receive the order has to be given separately by the person for whom the order is meant. As such, we are of the view that the said provision does not cover the present situation. 5. We further note that inasmuch as admittedly the order passed by the Commissioner (Appeals) was received back by them and no further service stands showed to us and in view of the fact of subsequent collection of the order by the appellant from the Consultant, we deem it fit to condone the delay in filing the present appeal. COD application is accordingly allowed and the stay petition is listed for hearing on 10-4-2012. (Order dictated and pronounced in the open Court)
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2012 (2) TMI 469
Clandestine removal - Shortage of stok - case of assessee is that the Revenue completely ignored melting loss of 4% of copper wire scrap and loss of 1% on copper wire scrap covered with insulated material - there was a difference of opinion and the matter went before Larger Bench where it was held that it is apparent that except for the shortage in raw material viz., HD which was disputed by the assessee and the statement of the Director, there was no other evidence on record to indicate clandestine manufacture and removal of final products. On behalf of the revenue, except for placing reliance upon the statement of the Director recorded during the course of the search proceedings, no evidence has been pointed out which corroborates the fact of clandestine manufacture and removal of final products. In the circumstances, on the basis of the material available on record, it is not possible to state that the Tribunal has committed any legal error in giving benefit of doubt to the assessee - there being no concrete evidence (as agreed by both the Members) of clandestine removal of the goods, the appeals are required to be allowed - appeal allowed - decided in favor of assessee.
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2012 (2) TMI 468
Disallowance u/s 40(a)(ia) for non-deduction of tax at source on dividend/interest paid to the chit subscribers - Held that:- The dividend distributed by the assessee herein does not partake the character of ‘interest’, and consequently, the assessee is not liable to deduct tax at source. The provisions of S.40(a)(ia) of the Act are not attracted, and accordingly the CIT(A) was justified in deleting the addition made by the assessing officer by resorting to disallowance in terms of S.40(a)(ia) of the Act.
Short Term Capital Gains on slump sale - Held that:- The assessee did not produce any depreeciati0on schedule to substantiate the claim of the assessee, and in the absence of any evidence to show that depreciation has been wrongly calculated or the exact depreciation schedule, rejected the contention of the assessee and upholding the action of the assessing officer. Considering totality of facts and circumstances of the case and taking into consideration the fact that the assessing officer has not taken into account the revised computation filed by the assessee during the assessment proceedings, and the CIT(A) has confirmed the action of the assessing officer in the absence of depreciation schedule or any evidence produced before him to substantiate the claim of the assessee, we find it just and proper to set aside the orders of the lower authorities on this issue, and restore the matter to the file of the assessing officer with a direction to examine the same afresh after giving reasonable opportunity to the assessee to adduce the necessary evidence to substantiate its claim with regard to the depreciation.
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2012 (2) TMI 467
Penalty levied under section 271(1)(c) - estimation of income by applying flat rate of gross profit - Held that:- Certain defects were found in the account books of the assessee and therefore the same was rejected and flat rate of gross profit was applied by the Department. We find that it is well settled that no penalty under section 271(1)(c) of the Act could be imposed merely on the ground that there were defects in the account books of the assessee and the account books were rejected and the flat rate of the gross profit is applied to arrive at the gross profits of the assessee. Merely because in the case of the assessee a survey action was undertaken, it does not follow that the penalty under section 271(1)(c) was imposable on the estimated trading profit of the assessee. Accordingly, we find no justification for imposition of penalty under section 271(1)(c) of the Act on this issue, which is cancelled.
Issue of transaction with "SC" - assessee retained 3 per cent. on account of sales tax - Held that:- We find that the facts of the case may justify the confirmation of the addition made on this count by the Revenue authorities, but are not sufficient for sustaining the penalty imposed under section 271(1)(c) of the Act. We find that no evidence or material was brought on record by the Department to suggest that the assessee has retained 3 per cent. or part thereof on account of sales tax with it. The assessee has filed an explanation, which could not be termed as not bona fide. In the absence of any corroborative evidence to prove the charge that any part of 3 per cent. being sales tax on the transaction remained with assessee, we are unable to sustain the penalty imposed under section 271(1)(c) of the Act on the assessee, which is cancelled.
Unexplained cash credits under section 68 - Held that:- We find that there was sufficient reason for the assessee for its filing the necessary evidences before the Commissioner of Income-tax (Appeals). In the facts of the case, we consider that it shall be in the interest of justice to set aside the issue of addition of ₹ 8,09,100 under section 68 to the file of the AO with direction to decide the same afresh in accordance with law after allowing reasonable opportunity of being heard to the assessee. We direct accordingly.
Excessive or unreasonable payments of job work charges under section 40A(2)(b) -Held that:- We find that the assessee could not lead any evidence to show that the payment for job work were not excessive or unreasonable. The assessee has not given any comparable figures of job work rate prevailing in the market with regard to other parties in similar line of the trade for the relevant period. The assessee has given job work only to M/s. Krishna Organics and M/s. Jyoti Industries and both these firms are admittedly the sister-concerns of the assessee. The comparison of job work rate with the earlier year is not relevant. What is more relevant is the prevailing market rate of similar service rendered by the parties to the unrelated business firm. In the facts of the case, we hold that the pre-dominance of probabilities is against the assessee and accordingly the disallowance made by the AO under section 40A(2)(b) of the Act is confirmed
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