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Showing 61 to 80 of 1545 Records
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2017 (2) TMI 1489 - CESTAT NEW DELHI
Levy of Service tax - security services or not - providing security services by Police Department to various firms/organizations for commercial consideration and collected verification charges - HELD THAT:- An identical issue has come up before this Tribunal in the assessee-Appellant’s own case THE DEPUTY COMMISSIONER OF POLICE JODHPUR, SUPERINTENDENT OF POLICE VERSUS COMMISSIONER OF CENTRAL EXCISE AND SERVICE TAX, JAIPUR- [2016 (12) TMI 289 - CESTAT NEW DELHI] where it was held that police department, which is an agency of the State Govt., cannot be considered to be a person engaged in the business of running security services. Consequently, the activity undertaken by the police is not covered by the definition of Security Agency under Section 64(94) of the Act.
Demand cannot sustain - appeal allowed - decided in favor of appellant.
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2017 (2) TMI 1488 - CESTAT NEW DELHI
Remission of duty - Burglary - Cigarettes - It is the contention of the appellant – assessee that since the goods have been lost on account of burglary before the clearance of the same from the factory, remission of duty should be granted under Rule 21 of the Central Excise Rules - HELD THAT:- Commissioner (A) has declined to consider the request of the appellant for grant of remission for the reason that this is not the subject matter of the proceedings before him. Further the appellant has lodged an FIR with the Police Department alleging theft in his factory. It is also likely that police by now would have concluded the investigations into the allegation of burglary and their conclusion may be available.
In the show cause notice as well as order in original the main allegation which has been considered and discussed is that the appellant has clandestinely cleared the goods and hence will be liable to pay the Central Excise duty thereon. The proper authority to consider the remission of duty in respect of goods lost in terms of Rule 21 of the Central Excise Rules will be the Jurisdictional Commissioner of Central Excise. The Commissioner (A) has concluded that from the evidence on record no case of clandestine clearance has been made out against the appellant.
It is not known whether the appellant has already approached the Jurisdictional Commissioner for grant of remission of duty under rule 21 in respect of goods which they have claimed to have been lost in burglary. Since the duty liability on the cigarettes found missing in the factory is intricately connected to the claim for remission of duty, the entire case needs to be re-examined.
Case remanded to the Jurisdictional Commissioner for a denovo decision in the matter - Appeal allowed by way of remand.
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2017 (2) TMI 1487 - CESTAT NEW DELHI
Refund of Service Tax paid - time limitation - period for filing the refund claim in the original Notification was 60 days from the end of quarter - amendment to 6 months vide amending Notification No. 32/08 - applicability of Board’s Circular No. 112/6/2009 - discrepancies in the invoices too - HELD THAT:- As per the Board’s Circular No. 112/6/2009 dated 12.3.2009, the amended and extended period of 6 months would apply to pending refund claims.
The issue is no more res integra and stand settled by the Tribunal in the case of COMMISSIONER OF CENTRAL EXCISE, SURAT VERSUS ESSAR STEEL LTD. [2010 (9) TMI 334 - CESTAT, AHMEDABAD] laying down that extended period of limitation of six months vide notification No. 32/08 ST dated 18.11.08 has to be given effect retrospectively and would equally apply to pending refund claims - As such, inasmuch as all the refund claims stand filed within a period of six months from the end of quarter for which they have been filed, there are no merit in the Revenue’s contention.
Discrepancies in the invoices - HELD THAT:- The appellate authority has examined every invoice and has rightly observed that even if there are some discrepancies in the invoices, entire refund claim cannot be denied on that ground. He has also observed that all the substantiated conditions stand fulfilled by the respondent and has also examined the work sheet placed on record by the appellant containing all the related details. Revenue in their memo of appeal have not been able to bring out any such substantiated condition, which is leading to denial of the refund claims - there are no infirmity in the views adopted by the Commissioner (Appeals), thus requiring any interference.
Appeal of Revenue dismissed.
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2017 (2) TMI 1486 - CESTAT NEW DELHI
Refund of Service Tax - Time limitation - authorities took a view that such refund claims were required to be filed within one year from the date of issue of invoices and as such, after following the due process of law, rejected the same on point of limitation - HELD THAT:- It is seen that during the appellate proceedings, the appellant relied on the Tribunal’s decision in the case of COMMISSIONER OF CENTRAL EXCISE, PUNE-III VERSUS M/S COMPUTER LAND UK LTD. [2016 (2) TMI 609 - CESTAT MUMBAI]. In the said decision, Tribunal has considered the same issue and has observed that unless the entire quarter is completed, the exporter cannot file his refund claim and as such, the refund claims filed within one year from the end of relevant quarter are required to be considered as having been filed well within time.
Revenue is not disputing the fact that the issue stand covered by the said decision of the Tribunal. However, the appellate authority has not followed the same but simply observed that there is nothing on record to show that the same has attained finality. It is not the Revenue’s case that the said decision has been appealed against by the Revenue and stand reversed. In the absence of any such fact on record, the law declared by the Tribunal was binding on the lower authorities and the Appellate Commissioner was under a legal obligation to follow the same.
There are no justification for taking a different view - appeal allowed - decided in favor of appellant.
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2017 (2) TMI 1485 - CESTAT NEW DELHI
Non-payment of service tax - C&F Agency service - Reimbursement expenses - certain portion of consideration received from the client - HELD THAT:- On careful perusal of the terms of agreement and the supporting documents submitted by the appellant alongwith the relied upon case laws it is clear that the appellant shall not be liable to service tax on the amount claimed by them from their clients towards reimbursable expenditure with reference to arranging transport of cement to customers from their storage premises. This is in terms of their agreement with the client and the amounts are on actual basis. The transport documents nowhere indicates the name of the appellant. As such based on the decided cases referred to above by the appellant, it is clear that such amounts are not to be included in the assessable value to determine the tax liability under C&F Agency service.
Wherever the amounts are reimbursed on actual basis in terms of contractual agreement as supported by documentary evidence, the same is not liable to be added in the taxable value. The amount liable for exclusion are to be verified and satisfied by the jurisdictional officers - Appeal allowed by way of remand.
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2017 (2) TMI 1484 - ITAT DELHI
Revision u/s 263 - disallowance of royalty and technical fees - AO disallowed 25% of the expenditure as capital expenditure - HELD THAT:- On this disallowance we do not agree with the order of ld CIT to hold that 75% of amount of expenditure allowed by the AO is erroneous and prejudicial to the interest of the revenue. Furthermore, the ld CIT has set aside the issue to the file of Assessing Officer to carry out the full enquiries in the matter. It is also contrary to the principal laid down by the Hon'ble Delhi High Court in CIT Vs. Jyoti Foundation [2001 (11) TMI 48 - GUJARAT HIGH COURT] and DG Housing [2012 (3) TMI 227 - DELHI HIGH COURT]. It can also be not said that there is lack of enquiry on the aspect of allowability of expenditure. The ld Assessing Officer himself raised the query with respect to the allowability of the above expenditure is revenue expenditure, considered the reply of the assessee, thereafter has reached at a conclusion that 25% of the expenditure is capital in nature. Therefore the Ld. assessing officer has examined the expenditure with reference to capital expenditure versus revenue expenditure and its allowability vis a vis quantum also. Therefore, it cannot be said that the view taken by the AO is erroneous. Furthermore, ld CIT has failed to establish what is the error committed by the Assessing Officer. He has merely stated that in the order of the ld Hon'ble High Court in Southern Switchgear [1983 (3) TMI 18 - MADRAS HIGH COURT] there are two other decisions of Hon'ble High Court were referred where 50% and 100% of the expenditure were held to be capital in nature. Therefore, it is clearly discernible that ld CIT is just questioning the estimate made by the Assessing Officer. Therefore, we are not inclined to uphold the order of ld CIT u/s 263 of the Act on this count.
Disallowance of 25% model fee holding it as capital in nature - HELD THAT:- The issue of allowability of the model fee has also been examined by the Hon’ble high court in case of the assessee wherein it has been held to be revenue in nature and fully liable to the assessee.
During the course of assessment proceedings the Ld. assessing officer has raised the adequate queries on this point which was also replied by the assessee therefore we are not inclined to hold that it is also a case of Lack of Inquiry.
Therefore for similar reasons given by us on the issue of royalty and technical guidance fees for this ground also we are not inclined to uphold the order of the Ld. CIT holding that the order of the Ld. Assessing officer is erroneous and prejudicial to the interest of revenue.
TDS u/s 195 on export commission - HELD THAT:- AO has made due enquiry in applicability of withholding tax on export commission and when the claim of the assessee is also supported by 2 circulars we do not find any infirmity in the order of the Ld. assessing officer in allowing the export commission to a foreign party when no services have been rendered in India. It is also not the case of the Ld. CIT that income of the agent is chargeable to tax in India when the recipient is resident of Japan.
CIT has incorrectly assumed jurisdiction on this issue. Further, the issue has already been decided in favour of the assessee by the coordinate bench in assessment year 2006 – 07 and 2007 – 08 allowing the claim of the assessee of export commission; therefore it cannot be said that the view taken by the Learned assessee officer was erroneous in allowing the claim of the assessee of the export commission.
CIT has also not referred to any of the judicial precedents where the export commission has been held to be royalty or fees for technical services none has been brought to our notice by the learned CIT during the course of hearing - Thus not possible to hold that the order of the Ld. assessing officer was erroneous. Therefore we quash the order of the Ld. CIT in assuming jurisdiction under section 263 of the income tax act with respect to allowance of export commission.
Double disallowance of depreciation - HELD THAT:- Claim is allowed is related to the assessee in the consequential order dated 26/10/2009 passed under section 143 (3) read with section 263 of the income tax act therefore it is unfair for Ld. CIT to assume jurisdiction under section 263 of the income tax act.
Additional depreciation on the computers - HELD THAT:- The query was raised during the course of the assessment proceedings which was replied on 01/12/2006 explaining the fulfillment of conditional for claim of additional depreciation with risk back to various assets. As claimed by the assessee that this issue has been decided in favour of the assessee by dispute resolution panel in its own case for assessment year 2006 – 07 therefore it cannot be said that the claim allowed by the ld. assessing officer is erroneous at all. In view of this we cannot sustain the order of Ld. CIT in assuming jurisdiction under section 263 of the income tax act, as it cannot be said that the order of the Ld. assessing officer in allowing additional depreciation on computers is erroneous as well as prejudicial to the interest of the revenue. - Assessee appeal allowed.
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2017 (2) TMI 1483 - ITAT MUMBAI
Disallowance on account of loss from stock market activity claimed as ‘set off’ against the profit from money market activity - whether the transactions carried out by the assessee of trading of money market securities was speculative or non-speculative in nature? - HELD THAT:- As demonstrated with the help of various evidences in the paper book in the form of contract notes and other documents to show that no deliveries were exchanged and only ‘difference’ amount was settled. Our attention was drawn on the ledger account containing details of trading of money market transactions showing that in all the cases only ‘difference’ amount of sale or purchase of money market securities has been credited or debited in the assessee’s a/c by the broker. These evidences have not been controverted by the Ld. Special Counsel of the Revenue. Thus, the admitted facts brought on record are that no deliveries were exchanged for carrying out money market transactions by the assessee. It is noted that in the identical circumstances ITAT in the case of Group companies of the assessee namely M/s. Growmore Leasing Investment [2015 (3) TMI 1342 - ITAT MUMBAI] held that such transactions would be speculated transactions.
Loss/profit from shares market transactions can very well be set off/adjusted against loss/profit of money market transactions. This issue has already been decided in favour of the assessee by the Tribunal in the case of group company of the assessee namely M/s. Growmore Leasing Investment (supra) as discussed above also. No distinction has been pointed out on facts or legal position by the Ld. Special Counsel of the Revenue, therefore we find that the claim of the assessee is allowable. Therefore disallowance made by the AO is directed to be deleted. Thus, ground no.2 is allowed.
Addition towards maintenance of accounts - disallowance was made by the lower authorities on the ground that the assessee was not able to prove rendering of service with regard to payment claimed to be made to one ABCD Group which refers to ‘Account Backlog Clearance Department’ - HELD THAT:- It is noted that the assessee has claimed that payment was made to the said ABCD group for clearing of backlog of accounting work. But, neither the assessee was able to show that payment was made nor the assessee was able to show anything to prove rendering of services by the payee. Thus, it could be substantiated by the assessee that this amount was incurred for the business purpose of the assessee; if at all this amount was genuinely paid. Therefore, in absence of proper substantiation, this claim is found to be not allowable. Therefore, we decline to interfere in the order passed by the lower authorities on this issue. This ground is rejected.
Depreciation on the computer - addition on the ground that user of the computers could not be proved by the assessee during the year before us - HELD THAT:- Appellant had placed order for computer system on 31.3.90 for which advance payment was made and the delivery of the System was affected on 31.3.90. In view of the above, there is no reason to reject the claim for depreciation on the computer. We agree with the Ld. CIT(A) in the order given in the first round that there was no reason to deny claim of depreciation on the computer. After taking into account overall facts and circumstances of the case, we agree with the observation and views given by the Ld. CIT(A) in the first round and therefore, delete the disallowance made by the AO in this regard.
Deduction on account of interest payable to the brokerage firms - HELD THAT:- As relying on own case [2015 (3) TMI 1342 - ITAT MUMBAI] we send this issue back to the file of Ld. CIT(A) for fresh adjudication after giving adequate opportunity of being heard to the assessee. Ld. CIT(A) shall follow the directions as have been given in the aforesaid order. This ground may be treated as allowed for statistical purposes.
Levy for interest u/s 234A, 234B, 234C - HELD THAT:- We find force in the prayer made by the Ld. counsel and accordingly hold that levy of interest is consequential u/s 234A, 234B and 234C; but restore this issue back to the file of the AO for computing the interest after giving credit of amount of TDS and AO shall follow the directions as have been given by the Tribunal in the case of group company namely M/s. Harsh Estates Pvt. Ltd. [2014 (10) TMI 925 - ITAT MUMBAI]. Thus, these grounds are sent back to the file of the AO with the same directions as given above and may be treated as allowed for statistical purposes.
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2017 (2) TMI 1482 - ITAT MUMBAI
MAT credit available u/s 115JAA of tax paid along with surcharge and education cess - Surcharge and education cess as part of the income-tax - HELD THAT:- As noted from the above working that first of all tax amount has been computed on the total income of the assessee. Thereafter surcharge and education cess has been worked out upon the tax liability. Then, from the gross amount so arrived at, the amount of credit available u/s 115JB on account of income-tax, surcharge and education cess (all combined together) have been deducted and accordingly, net tax payable after setting off credit available u/s 115JB has been worked out. In our view, this is the correct method of computing tax liability as well as credit available u/s 115JAA. Accordingly, we direct the AO to verify the facts as have been given in the aforesaid working and compute the tax liability accordingly and allow the necessary relief to the assessee
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2017 (2) TMI 1481 - ITAT MUMBAI
Estimation of income - bogus purchases - CIT(A) applying estimated net profit @ 12.5%. on the above transactions - HELD THAT:- As assessee fairly agreed that a reasonable estimate of profit should be estimated in view of the fact that neither manufacturing of moulds nor sale of moulds is under dispute. According to us, assessee had made purchase but from grey market. We find that the similar finding were given by the CIT(A) that assessee might have purchased extra profit on account of saving of sales tax and other tax. Even by purchasing from grey market, assessee might have save some profits and profit of the assessee has depicted in the above chart which is minimum at the rate of 3.90% and maximum of 9.85%. We are of the view that a reasonable estimate on profit rate at 10% will suffice the issue. Accordingly, we direct the AO to estimate the profit rate @ 10% on the above purchases and appeal of the assessee is partly allowed and that of the Revenue is dismissed.
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2017 (2) TMI 1480 - SC ORDER
Levy of penalty u/s 271(1)(c) - addition being confirmed in quantum proceedings before the Tribunal - addition of certain amount is not a ground to impose penalty on the assessee - HELD THAT:- SLP dismissed.
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2017 (2) TMI 1479 - ITAT JAIPUR
Exemption u/s 11 - application for registration under Section 12AA rejected - HELD THAT:- There is no dispute with regard to the fact that the Ld. CIT has rejected the application on the basis that no activity has been carried out, therefore, genuineness of the same cannot be commented upon. We therefore, following the judgement rendered in the case of CIT vs Vijay Vargiya Vani Charitable Trust [2015 (2) TMI 671 - RAJASTHAN HIGH COURT] set aside of the order the Ld. CIT and restore this application for registration under Section 12AA for decision afresh, to the file of Ld. CIT(E). Grounds raised in the appeal is allowed for statistical purposes.
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2017 (2) TMI 1478 - KARNATAKA HIGH COURT
Prohibition of benami transactions - Prohibition of the right to recover property held benami - Suit barred by the Benami Transaction (Prohibition) Act, 1988? - HELD THAT:- Section 3 contemplates prohibition of benami transactions, whereas Section 4 contemplates prohibition of the right to recover property held benami. This transaction, if examined in the light of Sections 3 and 4 of the Act, what could be inferred is the plaintiff had invested in the transaction as a benami. Order VIIRule 11(1)(d) of CPC provides that where the suit appears from the statement in the plaint to be barred by any law, the plaint shall be rejected. The averments of the plaint itself clearly establishes that the suit is barred by the Act. Thus, the rejection of the plaint by the trial Court cannot be found fault with. The judgments referred to by the appellant are rendered in a different context which are not applicable to the facts of the present case.
From plaint averments read with under Order 7 Rule 11(1)(d) of CPC and the provisions of the Act, this Court is of the considered opinion that the suit filed by the plaintiff is hit by the provisions of the Act and requires to be rejected as barred by the provisions of the Benami Transaction (Prohibition) Act,1988. The plaint averments exclusively reflects that the suit is barred by law. There is no prohibition in rejecting the plaint at the threshold sans going into the ordeal of trial.
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2017 (2) TMI 1477 - SUPREME COURT
Discharge of bank guarantee already furnished - HELD THAT:- Petitioner makes a statement that he will deposit a sum of ₹ 3,00,00,000/- within a period of four weeks from today on which the bank guarantee already furnished by him will stand discharged - Further, within a period of six months thereafter, he undertakes before this Court to deposit the balance amount of ₹ 15,00,00,000/- making a total sum of ₹ 18,00,00,000/- which is the principal amount as stated in the Agreement dated 02.04.2014.
The amounts, so deposited, shall stand to the credit of a suit which the respondent proposes to file within a period of four weeks from today - SLP disposed off.
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2017 (2) TMI 1476 - SUPREME COURT
Seeking direction to the respondents to ensure, that no industry which requires “consent to operate” from the concerned Pollution Control Board, is permitted to function, unless it has a functional effluent treatment plant, which is capable to meet the prescribed norms for removing the pollutants from the effluent, before it is discharged - HELD THAT:- The financial contribution of the Central Government is to the extent of 50 per cent, that of the concerned State Government (including the concerned Union Territory) is 25 per cent. The balance 25 per cent, is to be arranged by way of loans from banks. The above loans, are to be repaid, by the industrial areas, and/or industrial clusters. We are also informed, that the setting up of a common effluent treatment plant, would ordinarily take approximately two years (in cases where the process has yet to be commenced). The reason for the above prolonged period, for setting up “common effluent treatment plants”, according to learned counsel, is not only financial, but also, the requirement of land acquisition, for the same.
Given the responsibility vested in Municipalities under Article 243W of the Constitution, as also, in item 6 of the 12th Schedule, wherein the aforesaid obligation, pointedly extends to “public health, sanitation conservancy and solid waste management”, we are of the view, that the onus to operate the existing common effluent treatment plants, rests on municipalities (and/or local bodies). Given the aforesaid responsibility, the concerned municipalities (and/or local bodies), cannot be permitted to shy away, from discharging this onerous duty. In case there are further financial constraints, the remedy lies in Articles 243X and 243Y of the Constitution. It will be open to the concerned municipalities(and/or local bodies), to evolve norms to recover funds, for the purpose of generating finances to install and run, all the “common effluent treatment plants”, within the purview of the provisions referred.
The process of evolving the above norms, shall be supervised by the concerned State Government (Union Territory), through the Secretaries, Urban Development and Local Bodies respectively, (depending on the location of the respective common effluent treatment plant). The norms for generating funds, for setting up and/or operating the 'common effluent treatment plant' shall be finalized, on or before 31.03.2017, so as to be implemented with effect from the next financial year. In case, such norms are not in place, before the commencement of the next financial year, the concerned State Governments (or the Union Territories), shall cater to the financial requirements, of running the “common effluent treatment plants”, which are presently dis-functional, from their own financial resources.
The malady of sewer treatment, should also be dealt with simultaneously. We therefore hereby direct, that 'sewage treatment plants' shall also be set up and made functional, within the time lines and the format - mere directions are inconsequential, unless a rigid implementation mechanism is laid down. We therefore hereby provide, that the directions pertaining to continuation of industrial activity only when there is in place a functional “primary effluent treatment plants”, and the setting up of functional “common effluent treatment plants” within the time lines, expressed above, shall be of the Member Secretaries of the concerned Pollution Control Boards. The Secretary of the Department of Environment, of the concerned State Government (and the concerned Union Territory), shall be answerable in case of default. The concerned Secretaries to the Government shall be responsible of monitoring the progress, and issuing necessary directions to the concerned Pollution Control Board, as may be required, for the implementation of the above directions. They shall be also responsible for collecting and maintaining records of data, in respect of the directions contained in this order. The said data shall be furnished to the Central Ground Water Authority, which shall evaluate the data, and shall furnish the same to the Bench of the jurisdictional National Green Tribunal.
It would be in the interest of implementation of the objective sought to be achieved, to also require each concerned State(and each, concerned Union Territory) to make provision for “online, real time, continuous monitoring system” to display emission levels, in the public domain, on the portal of the concerned State Pollution Control Board. We are informed, that at least three State Governments have already adopted the aforesaid measures. Such measures shall be put in place by all the concerned State Governments( including, the concerned Union Territories), within six months from today - Petition disposed off.
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2017 (2) TMI 1475 - DELHI HIGH COURT
Revision u/s 263 - scope and powers under Section 263 of CIT - No enquiries during the course of the assessment proceedings. In the present case the tribunal found as a fact that the “Principle of Mutuality” - HELD THAT:- The tribunal has examined this aspect in [2016 (6) TMI 370 - ITAT DELHI]. The tribunal has also examine case of SHIMLA VERSUS M/S GREENWORLD CORPORATION AND M/S THE GREEN WORLD CORPORATION VERSUS ITO, PARWANOO & ANR. [2009 (5) TMI 14 - SUPREME COURT] with regard to the scope and powers under Section 263 of the said Act.
Also order would be erroneous only when the assessing officer makes no enquiries during the course of the assessment proceedings. In the present case the tribunal found as a fact that the “Principle of Mutuality” had been examined threadbare by the assessing officer itself and therefore it was not a case where the Commissioner could have exercised jurisdiction under Section 263 of the said Act. In these circumstances, we do not feel that there is any substantial question of law which arises for the consideration, of this Court. The appeal is dismissed.
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2017 (2) TMI 1474 - ITAT MUMBAI
Disallowance u/s 14A r.w.r. 8D - assessee has earned dividend income - HELD THAT:- As decided in [2016 (11) TMI 1681 - ITAT MUMBAI] as claimed by the assessee that no borrowed funds were utilized for earning the exempt income by the assessee and further the dividend were directly credited in the bank account of the assessee and no expenditure was claimed. What it may be, we find that the assessee only received dividend income, therefore, there is no question of disallowance by invoking section 14A r.w. Rule 8D under the facts available on record.
Also explained by assessee that on identical fact in earlier years, no disallowance was made. In the present assessment year also, no borrowed funds were invested by the assessee for making investment in shares or for earning dividend income.Disallowance u/s 14A r. w. Rule 8D cannot exceed the exempt income. In view of this fact, we find merit in the claim of the assessee. The appeal of the assessee is therefore, allowed.
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2017 (2) TMI 1473 - ITAT MUMBAI
Admission of additional evidences by CIT-A - No opportunity of examination, verification and seeking AO’s comments - denial of natural justice - HELD THAT:- Assessee filed large number of additional evidences to support its contentions before the learned CIT(A) for the first time during appellate proceedings - CIT(A) admitted theses additional evidences filed with respect to all the three afore-stated additions made by the AO to the income, wherein all the three afore-stated additions stood deleted by CIT(A) on appreciation on merits of these large number of additional evidences filed by the assessee with learned CIT(A) vide his appellate order dated 31-03- 2015.
These large number of additional evidences so submitted by the assessee for the first time during the course of appellate proceedings before the learned CIT(A) were admitted by the CIT(A) without giving and specifying any reasoning and justification as to the limbs under which as contemplated under Rule 46A(a) to (d) of Income-tax Rules, 1962 these additional evidences were admitted by him while adjudicating first appeal of the assessee as no justification were given by the assessee for non-filing of these evidences before the learned AO. Further, these large number of additional evidences were also not forwarded by learned CIT(A) to the A.O. for giving an AO an opportunity of examination, verification and seeking AO’s comments as no remand report was called by the learned CIT(A) as contemplated u/r 46A(3) of Income-tax Rules,1962. The ld. CIT(A) has to record reasons in writing before accepting additional evidences filed before him by the assessee for the first time as contemplated u/r 46A(2) of Incometax Rules, 1962, which has not been done by learned CIT(A) in the instant appeal - Decided in favour of revenue for statistical purposes.
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2017 (2) TMI 1472 - ITAT MUMBAI
Penalty u/s. 271(1)(c) - assessee is a trader in fabrics but on survey u/s.133A it was found engaging only in issuing accommodation sale bills - HELD THAT:- We found that the issues in controversy regarding penalty has been decided in the assessee group case in the case of Smt. Hema R. Gupta and Shri Nilesh Rakesh Kumar Gupta [2016 (11) TMI 448 - ITAT MUMBAI] wherein the similar kind of penalty has been deleted by the tribunal and held this is not a fit case where penalty can be imposed under section 271 (1 )(c) of the Act for concealment of income or for furnishing incorrect particulars of income. We, therefore, set aside the impugned order and allow the grounds of appeal of the assessee.
Penalty levied on the alleged unexplained loan - HELD THAT:- As decided in own case [2016 (9) TMI 1243 - ITAT MUMBAI] Assessing Officer has disallowed the deduction on ground that assessee had not substantiated the claim. But, Assessing Officer failed to consider that loans are opening balance which were accepted in 2005-06 - Assessee submitted that assessee had provided all the details available Assessing Officer. Hence, Assessing Officer cannot state that assessee failed to substantiate the claim. So, the deduction claimed by assessee is requested to be allowed. - Decided in favour of assessee.
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2017 (2) TMI 1471 - ITAT HYDERABAD
TP Adjustment - comparable selection - HELD THAT:- TCS e-Serve Limited - Following the turnover filter as well as taking note of the fact that it owns and possesses brand value and intangibles as compared to the assessee which does not own such assets, we direct that this company be excluded from the list of final comparables.
M/s. E-clerx Services Ltd is to be excluded on the ground that it is a KPO.
M/s. Infosys Ltd to be excluded on exceptional circumstance and dissimilar functionality and operating in a different business strategy as relying on M/s Hyundai Motors India Engineering P. ltd [2015 (11) TMI 1648 - ITAT HYDERABAD]
Disallowance of an amount towards TDS payable on contracts and towards salaries invoking the provisions of Section 43B - HELD THAT:- Disallowance made by the AO is not according to the provisions of law. The TDS if any not paid or short paid, the same can be recovered by separate proceedings but the same cannot be disallowed u/s. 43B, as the said TDS is not allowable deduction to assessee. It is out of the payments payable to contractors/salaries, TDS is being deducted on behalf of the government. Since the TDS amount itself is not a claim made u/s. 37(1), disallowance of the same does not arise. AO is directed to delete the same.
Interest on short term deposit - contention of the Ld. Counsel that the amount as shown in Form 26AS was only ₹ 4,05,38,239/-, whereas assessee offered ₹ 4,09,27,183/- which was more than amount shown in Form 26AS - HELD THAT:- We have examined the petition u/s. 154 filed before the AO as well as the contentions before the DRP and the copy of the Form 26AS filed before us at page 76. The basis for the AO’s observation of higher amount is not forthcoming from the record. In spite of direction from the DRP, AO has not followed the verification or the petition u/s. 154 was disposed-off. We are of the opinion that there is no basis for making such addition, after verification of the details filed by the assessee. Accordingly, AO is directed to delete the amount.
Short TDS credit - HELD THAT:- Assessee claimed an amount of ₹ 67,79,643/- in the return of income, whereas the AO allowed only ₹ 63,27,723/- in the final order without giving any basis for the same. AO is directed to verify the record and allow the claim after due verification. Ground is allowed for statistical purposes.
Disallowing the claim of set off of brought forward losses - HELD THAT:- There is no discussion in the order about the set off of losses and inspite of directions from the DRP, the same were not allowed. Ld. Counsel fairly admitted that these losses are subject to the orders in earlier years, accordingly, we direct the AO to verify the past record and determine the losses to be brought forward and allow the set off as per the provisions of law. Ground is considered allowed.
Levy of tax and interest on distributable profit u/s. 115-O - HELD THAT:- There is no basis for levy of interest on the amount as was done by the AO. Even if one day is excluded, then, the period of payment will be within the statutory provisions as provided. Further, as seen from the part B of Form 26AS placed on record, it indicate that amount of ₹ 5,77,830/- pertains to dividend tax was remitted on 6th January, 2010 itself. Since the payment was within the limits as provided, question of levy of interest does not arise. Accordingly, ground of assessee is allowed. AO is directed to withdraw the levy of taxes and interest.
Levy of interest u/s. 234A, 234B & 234C - HELD THAT:- Inspite of specifically bringing it to the notice of the AO by way of an application u/s. 154 filed on 28th January, 2015, AO has not taken any steps to examine nor withdraw the interest so levied. Since the return filed was with in the due date, we are of the opinion that interest u/s. 234A is not leviable. With reference to other interests, AO is directed to examine whether any interest is leviable as per the provisions of the Act, after giving due credit to the taxes paid/claimed. This aspect should be examined by the AO in detail and if any interest is to be levied, the working should be provided so that assessee can have knowledge of the same, so as to contest if required. With these observations, the ground is considered allowed for statistical purposes.
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2017 (2) TMI 1470 - ITAT DELHI
Revision u/s 263 - assessee submitted that a reasonable and proper opportunity of being heard was not provided by the ld. CIT - HELD THAT:- CIT in the body of the impugned order categorically stated that the assessment order passed by the Assistant Commissioner, Circle-2, Meerut appears to have been passed without proper investigation and inquiry from that observation.
From the said observation of the ld. CIT, it is clear that he was not sure how and in what manner the assessment order passed was without investigation and inquiry done by the AO, the word “it appears” used by him shows that he was not sure. CIT stated that Sh. Rajiv Jain, CA attended on behalf of the assessee with whom the issues were discussed. Nowhere it is stated that what were the submission of the assessee and why those were not accepted.
CIT admitted that the assessee had furnished the details relating to admissibility of expenses on foreign tour, repairs & maintenance, account of vehicles but no findings have been given on the said details, neither any remand report was sought, it is also not directed which inquiry was to be made by the AO. He simply directed the AO to examine the issue again and to pass a fresh order. In our opinion, the order passed by the ld. CIT is a non-speaking order. We, therefore, deem it appropriate to set aside the impugned order to the file of the ld. CIT for deciding the issue afresh in accordance with law - Appeal of the assessee is allowed for statistical purposes.
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