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2022 (7) TMI 1512 - ITAT BANGALORE
TP Adjustment - comparable selection - as submitted high amount of turnover companies cannot be compared to the assessee company as assessee’s turnover is very low compared to those companies - HELD THAT:- As relying on Barracuda Networks India Pvt. Ltd. [2022 (5) TMI 322 - ITAT BANGALORE] we direct the AO to exclude those high turnover companies from the list of comparables.
Tata Elxi Ltd. - We have already directed the AO/TPO to exclude this comparable from the list of comparables on the basis of turnover filter while adjudication in ground No.1(iii).
Persistent Systems Ltd. company is predominantly engaged in the business of providing outsourced software product development services to customers across the Globe from following industries verticals, infrastructure and systems, telecom and wireless, Life Science and Health care and finance services. However, the present assessee before us is in the business of computer radiated designing and development of commercial vehicle systems. The company is developing specific software for associated enterprises. It is also subsidiary of the ultimate holding company. The software development is used enhanced integrating the same with the main produce. Finally, what is being marketed is a final product by the ultimate holding company. The role of company has been that it is a contract software development support services provider. Being so, it cannot be considered as functionally comparable to assessee. Accordingly, on the basis of functionality, we direct the AO/TPO to exclude this company from the list of comparables.
Infobeans Technologies Ltd is providing wide range of services under four verticals i.e. services, automation, enterprise and industries and under the automation services verticals, the company is providing advanced robotic process automation services. Since Infobeans is into diversified activities it cannot be a suitable comparable vis-à-vis the taxpayer which is a routine software development services provider. Thus we direct the AO/TPO to exclude this company from the list of comparables.
Thirdware Solutions - As decided in M/S BORQS SOFTWARE SOLUTIONS PVT. LTD. [2021 (10) TMI 1351 - ITAT BANGALORE] this comparable has been excluded on the basis of turnover filter but before us the assessee stated that it has to be excluded on the basis of non-matching of margin. In our opinion, this has to be examined by the AO/TPO. Accordingly, we remit this issue to the file of AO/TPO for fresh consideration.
Cybage Software Ltd. - as submitted this company having super profit in immediate two financial years and also having huge turnover of Rs. 722.25 crores in the assessment year under consideration - If the functionality of the Cybage Software Pvt. Ltd. is not similar to the assessee and if the turnover was Rs. 722.25 crores in the assessment year under consideration, it has to be excluded on any one of the above reasons. The issue is remitted back to the file of AO/TPO for fresh consideration.
Exclusion of Sagar Soft India Ltd - According to the Ld. A.R., this company is having persistent loss and only in assessment year 2016-17, it was declared profit - If there is loss consistently in immediate previous 3 years then only it would have excluded. On the other hand, if the loss is only in one assessment year out of 3 immediate previous assessment years, this company is to be considered as comparable. Accordingly, this issue is remitted to the AO/TPO for fresh consideration.
Include M/s. S.K. Mile Software Solutions Pvt. Ltd. and stated that the segmental data may be obtained by TPO after calling information u/s 133(6) - We accede to the request of assessee’s counsel and set aside the matter to the file of AO/TPO to procure the relevant data by issuing notice u/s 133(6) of the Act and decide it afresh.
Non-following the direction of Ld. DRP regarding comparable company, M/s. ASM Technology Ltd., wherein Ld. DRP has given specific direction to verify the claim of the assessee that company does not fail in export turnover criteria and the TPO has passed the final order without any verification rejecting the comparable - The issue has to be reconsidered by TPO in accordance with the direction given by the Ld. DRP. Ordered accordingly.
Adjustment of notional interest on outstanding receivables - international transaction or not? - HELD THAT:- As similar issue came up for consideration in the case of MetricStream Infotech (India) Pvt. Ltd.[2020 (4) TMI 883 - ITAT BENGALURU] as held that outstanding sum of invoices is akin to loan advanced by assessee to foreign AE., hence it is an international transaction as per explanation to section 92 B of the Act.
Also following the earlier decision in Kusum Healthcare [2017 (4) TMI 1254 - DELHI HIGH COURT] it was observed that there are several factors which need to be considered before holding that every receivable is an international transaction and it requires an assessment on the working capital of the assessee. Applying the decision (supra), the Hon’ble High Court directed the TPO to study the impact of the receivables appearing in the accounts of the assessee; looking into the various factors as to the reasons why the same are shown as receivables and also as to whether the said transactions can be characterized as international transactions - thus we deem it appropriate to set aside this issue to Ld.AO/TPO for deciding it in conformity with the above referred judgment - ground raised by assessee stands allowed for statistical purposes.
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2022 (7) TMI 1511 - SUPREME COURT
Principle of just punishment - threatening a party in a civil dispute relating to a property and extracting money, which under threat was conceded by the litigating party - HELD THAT:- It cannot be lost sight that when reference is made in a set off for adjustment of periods, the reference is to proceedings within the country. The criminal law of the land does not have any extra-territorial application. Thus, what happens in another country for some other trial, some other detention, would not be relevant for the purposes of the proceedings in the country. The factual scenario is that the Appellant was charged with having a fake passport. He was found guilty and convicted of sentence from 18.09.2002. This had nothing to do with the proceedings against him in India. His sentence would have been completed on 18.03.2007 de hors the aspect of remission or commutation.
The mere fact that there was also a detention order under the Red Corner notice was of no significance. He was again imprisoned from 12.10.2005 till 10.11.2005, i.e. when he was handed over to the Indian authorities. The period till 10.12.2005, when he was serving out the sentence, certainly could not have been counted. That leaves the period of less than a month only, which is really more of an academic exercise.
The detention of the Appellant commence from 12.10.2005 in the present case. On the Appellant completing 25 years of sentence, the Central Government is bound to advice the President of India for exercise of his powers Under Article 72 of the Constitution, and to release the Appellant in terms of the national commitment as well as the principle based on comity of courts. In view thereof, the necessary papers be forwarded within a month of the period of completion of 25 years sentence of the Appellant. In fact, the Government can itself exercise this power in terms of Sections 432 and 433 of the Code of Criminal Procedure and such an exercise should also take place within the same time period of one month.
Appeal disposed off.
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2022 (7) TMI 1510 - SC ORDER
Disallowance u/s 14A, Loss arising on account of valuation of outstanding liabilities / receivables, Adjustments made in the book profit u/s 115JB following disallowance made u/s 14A on account of foreign exchange fluctuations, Bogus purchases u/s 69C - HC [2020 (3) TMI 552 - BOMBAY HIGH COURT] dismissed revenue grounds as no ground to entertain the questions for consideration - HELD THAT:- The special leave petition will stand dismissed.
Pending application stands disposed of.
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2022 (7) TMI 1509 - SUPREME COURT
True nature of the collaboration agreements whereby the owner (title holder) parted with possession to the colonizer / developer for payment of valuable consideration and allocation of a certain number of constructed units or percentage of built-up area - Scope of the term 'transfer'.
HELD THAT:- This Court’s findings are summarized as follows:
a. The expression ‘transfer’ used, is not confined to sale, lease or other encumbrance. It includes development and/or collaboration agreements, as well as licenses issued (for development) during the suspect period, whether or not in favour of the developer.
b. The lands covered by licenses issued to Paradise (ultimately transferred to Green Heights); Karma (for which collaboration was entered into with Unitech); Ram Pyari, Balbir Singh, Earl and Frontier (ultimately used by Godrej); Express Greens (DLF); Kalinga and Innovative amount to transfer.
c. With respect to Green Heights, a sum of ₹ 5 crores per acre is payable by Green Heights to HSIIDC. Therefore, the final amount payable is 2.681 acres x ₹ 5 crores = ₹ 13,40,50,000 /- (rupees thirteen crores, forty lakhs, and fifty thousand only) within six months from the date of this judgment, failing which interest at the rate of 6% per annum shall be levied from the date of default. Green Heights is entitled to recover from Paradise such proportionate sums it may be entitled to claim having regard to the terms of their agreement.
d. With respect to Godrej, a sum of ₹ 5 crores per acre is payable by Godrej to HSIIDC. Therefore, final amount payable is 13.743 acres x ₹ 5 crores = ₹ 67,36,30,000 /- (rupees sixty-seven crores, thirty-six lakhs and thirty thousand only) within six months from the date of this judgment, failing which interest at the rate of 6% per annum shall be levied from the date of default. Godrej is entitled to claim such proportionate sums as it may be entitled to in terms of its agreement with Frontier, Earl, Balbir Singh and Ram Pyari in accordance with law.
e. Upon full compliance with directions above, the lands covered by Green Heights and Godrej’s projects shall be excluded from the deemed award.
f. With respect to Karma, the 25.95 acres of land subject of License No. 206 of 2008 forms part of the deemed award. The State shall take appropriate steps and issue the supplementary award in respect of these lands within six months from the date of this judgment. Karma is entitled to compensation in accordance with the Acquisition Act as on the date of the notification under Section 4, and is entitled to statutory benefits such as interest, solatium etc. on such determined compensation.
g. Lands measuring 2.9875 acres and 10.881 acres respectively belonging to R.P. Estates and Subros, are excluded from the deemed award.
h. With respect to Express Greens (DLF), contentions to exclude the project from the deemed award are rejected. It is directed that:
(i) HSIIDC shall complete the process of validating the title of allottees, including the title to the undivided and proportionate land share, within six months from the date of this judgment;
(ii) HSIIDC shall notify the balance allottees about the execution of sale deed - the process of execution and registration of sale deed to be completed within six months from the date of this judgment. HSIIDC shall ensure that a designated nodal officer is deployed to scrutinize the relevant documents and facilitate the execution of such sale deeds; and
(iii) All rights, title and interest in respect of the unsold 39 townhouses in the independent floors vests with the HSIIDC, which shall deal with them in accordance with its policies and applicable laws. Likewise, in case of unsold apartments, all rights, title and interest shall vest with HSIIDC.
(iv) With respect to 96 apartments on the 15th tower which have been completed but no occupation certificate has yet been issued, the DTCP shall ensure due inspection and decision on the pending occupation certificates. HSIIDC to complete any deficiency that has to be rectified.
(v) With respect to club houses and boundary wall in sector M-1 and M1(A), the HSIIDC is directed to take up work immediately and complete the same with eighteen months from the date of this judgment.
(vi) All unconstructed and unallotted portions as well as construction rights (such as FAR) in respect of unconstructed, unallotted plots etc., including two school sites, shall vest absolutely with HSIIDC. HSIIDC is entitled to develop these areas in accordance with its policies within the frame work of the applicable Master Plan development laws. DLF is entitled to collect amounts, if any, in terms of the main judgment of this Court. It shall hand over all records relating to the allottees, and technical data, pertaining to the entire project to HSIIDC within one month from the date of this judgment.
i. With respect to Kalinga, it is directed that
(i) HSIIDC shall complete verification of all the relevant documents furnished by Kalinga. Any additional documents or invoices, or relevant materials which Kalinga may wish to rely upon, shall be furnished to HSIIDC within two weeks. Thereafter, HSIIDC shall conduct verification, and based upon that exercise, and relevant inquiries (for which it may seek such assistance of Kalinga as is necessary) indicate the final valuation within six months from the date of this judgment. The amount in furtherance of that valuation shall be released, within three months of completion of verification.
(ii) HSIIDC shall complete the verification of documents, in relation to all those who claim refund as allottees of Kalinga, within six months. Such allottees or flat owners, (who have not obtained possession) shall be disbursed the amounts they are entitled to within six months thereafter.
(iii) In the event of any dispute, with respect to the entitlement or amounts payable, it is open to the concerned allottee or flat buyer to take recourse to appropriate proceedings in law, i.e., by filing civil suit, or complaints under the Consumer Protection Act, 1986. It is clarified that no proceeding, application or contempt petition in this regard, will be entertained by this Court.
j. With respect to ABW, it is directed that HSIIDC to refund the amounts payable to the allottees of the entire project, i.e., allottees of residential units/plots and commercial or shop space, within the next twelve months from the date of this judgment, failing which interest at the rate of 6% per annum shall be levied from date of default. The lands of ABW shall form part of the deemed award.
k. With respect to Speed Town, the contentions to exclude the land from the deemed award are rejected. It is held that Speed Town shall be entitled to the compensation to be decided, in respect of the land, on the same basis as in the case of all others entitled to it.
l. With respect Paramveer, the contentions to exclude the hotel block from the deemed award are rejected. All rights, title and interest in those portions of Innovative’s properties shall vest in HSIIDC and be part of the deemed award. Innovative shall be entitled to amounts like in the case of all other developers/owners in accordance with the main judgment. HSIIDC shall verify its claims. In the event of any dispute in this regard, Innovative is at liberty to press its claim in substantiative legal proceedings and not their miscellaneous applications before this Court
m. With respect to Legend Heights, HSIIDC is directed to:
(i) Hand over commercial units to allottees who were either granted occupation, and /or in whose favour conveyance was executed. As far as others are concerned, HSIIDC to first verify the claims of all persons/entities who claim to have paid substantial amounts and have not been allotted their spaces, and shall, depending on the stage and nature of construction and the extent of amount paid (it is more than 75 per cent of the total consideration) hand over possession of the units, after due completion.
(ii) Duly verify and pay refunds sought by any allottee within six months of the date of this judgment, failing which interest at the rate of 6% per annum shall be levied from date of default.
(iii) In respect of all unallotted units and areas which can be constructed upon, title shall vest exclusively with HSIIDC.
n. With respect to Dharamveer and other petitioners, as well as similarly placed individuals the rights and title in respect of lands under their occupation is vested with HSIIDC. It is up to the HSIIDC to frame such scheme as is permissible in accordance with its parent enactment and a non-discriminatory manner by a scheme, in regard to such land (i.e., the 27 acres to which the petitioners and others like them may claim relief) as it may deem appropriate. In case the HSIIDC chooses to do so, it shall be bound by all provisions of the Master Plan and Zoning and such other rules and regulations as are applicable, in the area and shall strictly enforce them.
o. The State is directed to ensure that all references pertaining to the acquisition are answered as expeditiously as possible. The concerned reference courts are hereby directed to conclude all the proceedings in 185 references received for 365 acres of land and pronounce the award in accordance with law within a period of one year from the date of this judgment.
p. It is clarified that wherever the allottees have not paid the full amounts (payable in terms of the agreements) HSIIDC shall be entitled to the same rights in law as in the case of the original builder/developer, which include, but are not limited to, insisting full payment before handing over possession to the allottees.
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2022 (7) TMI 1508 - ITAT MUMBAI
TP adjustments - non-recovery of charges for providing letter of support/comfort - HELD THAT:- Since the issue is exactly similar and grounds as well as the facts are also identical, respectfully following the above decision in assessee’s own case for the A.Y. 2010-11 [2022 (2) TMI 1428 - ITAT MUMBAI] and also following the principle of “Rule of consistency”, we allow the ground raised by the assessee.
Addition u/s 14A r.w.r 8D - HELD THAT:- Since the issue is exactly similar and grounds as well as the facts are also identical, respectfully following the above decision in assessee’s own case for the A.Y. 2010-11 and also following the principle of “Rule of consistency” as held as no proper satisfaction has been recorded by the learned assessing officer in terms of the provisions of Section 14 A (2) having regard to the accounts of the assessee about the correctness of the claim of the assessee in respect of expenditure in relation to income which does not form part of the total income Under the act. In view of this ground of the appeal of the learned assessing officer is dismissed.
Excess DDT paid by the assessee u/s 115O - beneficial rate as per the applicable Double Taxation Avoidance Agreement (DTAA) for dividends paid to non-resident shareholders - HELD THAT:- We observe that similar issue was considered and adjudicated by the Coordinate Bench in assessee’s own case for the A.Y.2010-11 [2022 (2) TMI 1428 - ITAT MUMBAI] wherein held there is no information about the country of residence of those shareholders, whether those shareholders have Tax Residency certificate of that country, there is no submission whether the dividend income is income of shareholders and about how the assessee will claim refund of the taxes , if same is income of the shareholders. Further the host of issues with respect to applicable of DTAA as stated in grounds of appeal by assessee are required o be addressed. Therefore, in case of assessee itself for assessment year 2009 – 10 we also set-aside this issue back to the file of the learned assessing officer with direction to the assessee to submit its claim with all necessary supporting evidences and certificates and then ld.AO to decide in accordance with the law.
Reduction in claim made u/s. 35(2AB) for certain R&D expenditure - HELD THAT:- Respectfully following the above said decision of the Tribunal in assessee’s own case for A.Y. 2010-11, we are inclined to set-aside the issue to the file of the Assessing Officer for verification as per the directions of the earlier Tribunal orders verifying whether the expenditure in question has been incurred by the assessee on research and development which is eligible for deduction u/s 35(2AB). The appeal of the assessee is accordingly treated as allowed for statistical purpose.
Non-Inclusion of Damaged Stock in valuation of closing stock - HELD THAT:- We observe that assessee is valuing closing stock for damaged stock taking the value at NIL and however, Assessing Officer makes disallowance to the extent of 0.5% of the value of closing stock and the same was confirmed by the Coordinate Bench in the earlier years from A.Y. 2003-04 to 2006-07 and A.Y. 2008-09. We further observed that following the decision of the ITAT, CIT(A) in A.Y: 2009-10 and A.Y. 2010-11 had followed the same. Respectfully following the earlier decision of the ITAT, CIT(A) in the present appeal also allowed the same. Considering the fact on record and also this method is consistently followed by the assessee over the years there is no loss to the revenue. Accordingly, we do not find any reason to interfere with the findings of the CIT(A).
Balance 10% additional depreciation on addition made in earlier year - assessee has put to use it for less than 180 days - HELD THAT:- Similar issue was considered and adjudicated by the Coordinate Bench in assessee’s own case for the A.Y. 2010-11 [2022 (2) TMI 1428 - ITAT MUMBAI] and decided the issue in favour of the assessee.
Waiver of royalty income received from Bangladesh and Srilanka - royalty is computed @3% of the of the net sales by majority of Associated Enterprise - HELD THAT:- We observe from the record that the assessee has granted waiver of royalty to its two subsidiaries i.e. Bangladesh and Srilanka on account of commercial and business considerations. We observe that assessee has granted similar waiver in the past to the above said subsidiaries from A.Y.2008-09 to A.Y. 2010-11 and the assessee has disclosed the above said information in its T.P. Study Report. When the matter was referred to TPO, TPO has considered this information and do not propose any addition relating to these additions. It is fact on record that assessee has waived Royalty income to Bangladesh and Srilanka Subsidiaries for business consideration. It is also fact on record that the TPO has not proposed any addition u/s. 92CA of the Act and further, we observe that as per the provision of DTAA, the Royalty income cannot be recognized as revenue until such royalty are paid. In the given case the assessee has never received any Royalty from these Associated Enterprises.
In the similar situation the Coordinate Bench in the case of Diageo India Pvt Ltd [2019 (12) TMI 1615 - ITAT MUMBAI] held as upon hearing both the Counsel and perusing the records, we find that it is the claim of the assessee that payment of royalty is an international transaction and assessee has submitted the benchmarking report and the Transfer Pricing Officer has not made any adjustment. In this view of the matter, the Transfer Pricing officer has not made any adjustment. Hence, it was not open to the AO to apply the benefit test and make the disallowance u/s.37(1) of the Act, without proper examination of all aspects of the claim. Decided against revenue.
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2022 (7) TMI 1507 - ITAT DELHI
Accrual of income in India - Treating the amount received as Fees for Technical Services (FTS), hence, taxable u/s 44DA or 44BB - As per amount received is for providing services in connection with prospecting for or extraction or production of mineral oils, hence, has to be treated as business profit, thus, taxable under section 44BB - scope of India - France DTAA - whether amount received by the assesse qualifies as FTS under section 9(1)(vii)? - AO was of the view that the work/services performed/rendered by the assessee is by way of second line contractor - assesse is a non-resident corporate entity incorporated under the laws of France
HELD THAT:- The scope of work clearly envisages that the assessee has to render certain services in connection with the mining activity carried on in well A5 in KG Basin. Thus, once the activity carried on by the assessee falls within the expression “mining or like projects”, it goes out of the purview of FTS as defined under Explanation 2 to section 9(1)(vii) of the Act. That being the factual and legal position, the amount received by the assessee cannot be treated as FTS under section 9(1)(vii) of the Act. That being the case, the provision of the Act being more beneficial in such a scenario, as per section 90(2) of the Act, will be applicable. Therefore, there is no need for us to examine the applicability of the term ‘FTS’ under India – France Tax Treaty. Thus, once the amount received by the assessee does not fall within the definition of FTS under section 9(1)(vii) of the Act, by default, section 44DD would not apply to such payment.
Whether the amount received by the assessee is business profit under section 44BB? - as per sub-section (1) of section 44BB, the profits from providing services or facilities in connection with prospecting for or extraction or production of mineral oil would fall within the ambit of section 44BB. Thus, it is required to determine, whether the services provided by the assessee under the contract with RIL are in connection with prospecting for or extraction or production of mineral oils. The expression “in connection with” being of widest amplitude cannot be given a restrictive meaning. The expression would also encompass services or facilities provided to a person who is engaged in exploration or production of mineral oils. Going by the plain meaning of the words as used in the aforesaid provision, it cannot be said that for claiming benefit under section 44BB, a non-resident entity providing services in connection with exploration or production of mineral oils must itself be engaged in such activities.
In the case of Oil and Natural Gas Corporation Vs. CIT [2015 (7) TMI 91 - SUPREME COURT] while taking note of the nature of work to be executed under the contract, has observed that the pith and substance of the contract is inextricably connected with prospecting for or extraction or production of mineral oil. Thus, the amount received falls under section 44BB(1) of the Act. The aforesaid observations of Hon’ble Supreme Court would squarely apply to the facts of the present appeal, as, the work performed by the assessee under the contract is definitely in connection with prospecting for or extraction or production of mineral oils as it is inextricably linked to the exploration/extraction of oil from A5 well.
Contention of the Revenue that section 44BB would not be applicable to a second line contractor - As we find, the aforesaid issue has been decided against the Revenue by a Coordinate Bench at Delhi in case of DCIT Vs. Technip UK Ltd. [2018 (12) TMI 1069 - ITAT DELHI], thus we have no hesitation in holding that the amount received by the assessee has to be charged to tax under section 44BB of the Act. Therefore, we do not find any valid reason to interfere with the decision of learned DRP
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2022 (7) TMI 1506 - SC ORDER
Seeking release of goods alongwith vehicle - HELD THAT:- There are no reason to consider interference in the discretion as exercised in this matter by the High Court while passing the interim order, directing release of the goods and vehicles on payment of 1/4th of the demanded amount and by furnishing personal bond for the remaining amount.
It is left open for the petitioners to make other submissions before the High Court, including for alteration/modification of the interim order, as may be advised.
Petition dismissed.
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2022 (7) TMI 1505 - PUNJAB AND HARYANA HIGH COURT
Maintainability of petition - non-availment of the alternative remedy under Section 17 of the SARFAESI Act, 2002 - HELD THAT:- Reliance placed on the decision of the Supreme Court in the case of Aggarwal Tracom Pvt.Ltd. vs. Punjab National Bank Order [2017 (11) TMI 1523 - SUPREME COURT] to contend that the Writ Petitions under Article 226 of the Constitution of India cannot be entertained when effective statutory remedy is available to the aggrieved person, in a later judgment rendered in the case of Authorized Officer, State Bank of Travancore and Another Vs. Mathew K.C [2018 (2) TMI 25 - SUPREME COURT] , the Supreme Court held that there are well defined exceptions to the rule of exhaustion of alternative remedy as laid down in decision of Commissioner of Income Tax and Others vs. Chhabil Dass Agarwal [2013 (8) TMI 458 - SUPREME COURT] and one of such exceptions mentioned in Para 15 of the said judgment is “where the statutory authority has not acted in accordance with the provisions of the enactment in question.” - the plea of the respondent is rejected that the Writ Petition ought to be dismissed in view of existence of alternative remedy under Sec.17 of the Act.
Whether the petitioner is entitled to any relief? - HELD THAT:- As per Or.XXXVIII Rule 11 CPC, where property is under attachment by virtue of the provisions of the said Order XXXVIII CPC and a decree is subsequently passed in favor of the plaintiff, it shall not be necessary upon an application for execution of such decree to apply for reattachment of the property. So the attachment before judgment granted shall be effective and operative even after passing of the decree and while executing the decree it is not necessary to re-attach the property - So if the petitioner had to get clear title from the Bank pursuant to the tender /public notice dt.24.4.2019 (P4), he would have to satisfy the said decree in the above suit as well. Had the petitioner been aware of this, he might not have participated in the tender issued by the Bank at all.
No intending purchaser wants to buy fresh litigation or take on other unknown liabilities against third parties, and it was the statutory duty of the Bank to disclose them in the public notice/tender notice. So the action of the respondent Bank is arbitrary and contrary to the provisions of the Act - It is strange that these documents are disclosed along with reply affidavit had not been taken into account for disclosing in the tender/public notice dt.24.4.2019 (P4) (under Rule 8(6) (f)) the existence of civil court decree which undoubtedly would have a bearing on the willingness of the bidder to participate in a Public Auction/Tender notification and would also have impact on the price being offered.
The Bank has failed to act in a transparent manner, and had acted inequitably and arbitrarily - the respondent-Bank is directed to refund to the petitioner a sum of 1.80 Crores deposited by the petitioner with interest @ 7% per annum from the respective dates of deposit of such amount within 4 weeks from today - the Writ Petition is partly allowed.
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2022 (7) TMI 1504 - KERALA HIGH COURT
Validity of 101st Constitutional Amendment of the Kerala State Goods and Services Tax Act, 2017 - enforceability of provisions of the Kerala Value Added Tax Act, 2003 (KVAT Act) only until the expiry of one year from the date on which the nationwide goods and service tax was implemented or until the amendment was repealed by a competent legislature? - constitutional validity of orders u/s 25(1) of the KVAT Act, 2003 for the assessment years from 2013-14 to 2016-17.
HELD THAT:- The aforesaid challenge of 101st Constitutional Amendment of the Kerala State Goods and Services Tax Act, 2017 has been considered by this Court in M/S. SHEEN GOLDEN JEWELS (INDIA) PVT. LTD. VERSUS THE STATE TAX OFFICER (IB) -1, AND OTHERS [2019 (2) TMI 300 - KERALA HIGH COURT] and decided against the petitioner. Hence, in view of the judgment in Sheen Golden Jewels, the petitioner is not entitled to get any relief against the said challenge.
However, as far as Exts. P1 to P4 orders passed by the second respondent are concerned, the petitioner has to avail the remedy of appeal before the appellate authority and it is opined that, the writ petition can be disposed of directing the petitioner to approach the statutory authorities by way of appeal.
Petition disposed off.
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2022 (7) TMI 1503 - CALCUTTA HIGH COURT
Reopening of assessment u/s 147 - jurisdictional requirement ‘reason to believe’ - accommodation entries receipt - whether the reopening of the assessment as done by the assessing officer was justified? - assessee, on earlier bogus bill, has made accommodation entry - said allegation was made based upon a statement recorded from one Entry Operator - tribunal pointed out that in the reasons recorded for reopening, nowhere the assessee’s name has been specifically mentioned by Entry Operator, nor there is anything adverse against the assessee -. HELD THAT:- The assessee was found to have transacted with the said company through banking channel and faulted the assessing officer for reopening the assessment based on the statement of Shri Jindal which was a general statement and that the assessing officer assumed that the assessee is a beneficiary of the account. Furthermore, the tribunal pointed out that the just because the assessee had transaction with M/s. Bridge & Building Construction Co. Ltd. it cannot be a ground to believe that the assessee’s income escaped assessment. It was further held that without any other material as discussed, the conclusion drawn by the assessing officer, merely on receipt of the aforesaid information does not master the requirement of law to validly form the reason to believe escapement of income. Accordingly, the appeal filed by the revenue was dismissed.
After considering the submissions made on either side and carefully perusing the materials placed before us, we find that the entire matter is factual and the reopening itself was made on wrong presumption of facts. No substantial question of law.
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2022 (7) TMI 1502 - ALLAHABAD HIGH COURT
Condonation of delay of 530 days in filing the appeal of revenue before Tribunal - Sufficient reasons for delay or not - contrary to the decision of Supreme Court in the matter of Chief Post Master General & Ors. Vs. Living Media India Ltd. & Anr. [2012 (4) TMI 341 - SUPREME COURT] or not - HELD THAT:- The delay of 530 days has been explained on wholly vague and generic grounds of - (i) shortage of manpower and; (ii) excess work. In the affidavit of the assessing officer, besides the above, it was further stated, the senior assistant had been assigned B.L.O. duty, resulting in the delay. Neither the application nor the affidavit bring out necessary facts pertaining to shortage of manpower claimed or the excess of work claimed. Then, the date of election and date of assignment of duty of the senior assistant has also not been disclosed. In any case, in the context of delay of 530 days, it is wholly unacceptable that such delay could have been caused owing to conduct of election or assignment on the election duty to certain officials. That explanation is inherently inadequate.
The nature of explanation remains ever relevant and primary for consideration of the Court. It must inspire confidence as to truthfulness and completeness as to the delay sought to be explained. Only then, the Court may act and condone the delay. Where however, as in the instant case, that explanation is found to be lacking in particulars and substance as also intent, the Court may never act on the same. The law in that regard is fairly well settled. The Supreme Court in Postmaster General & Ors. Vs. Living Media India Ltd. & Anr., [2012 (4) TMI 341 - SUPREME COURT], has held The government departments are under a special obligation to ensure that they perform their duties with diligence and commitment. Condonation of delay is an exception and should not be used as an anticipated benefit for the government departments. The law shelters everyone under the same light and should not be swirled for the benefit of a few.
Seen in that light, the explanation furnished by the revenue was neither bona fide nor it appears to be otherwise sufficient or such as may have been relied by the Tribunal to condone the delay of 530 days.
The present revision is allowed. Question of law, framed above, is answered in the negative i.e. in favour of the assessee and against the revenue.
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2022 (7) TMI 1501 - ITAT RAIPUR
Addition u/s.68 - cash deposits n bank account of appellant unexplained - HELD THAT:- It is an admitted fact that the addition u/s 68 made by the AO and sustained by CIT(A) was on the basis of deposit entries in the bank statement of the assessee is in contradiction with the settled position of the law as decided in the case of CIT Vs. Bhaichand N. Gandhi [1982 (2) TMI 28 - BOMBAY HIGH COURT] wherein it is observed that a bank pass book or bank statement cannot be considered to be a ‘book’ maintained by the assessee for section 68 - Thus, we are of the considered view that the addition made by Ld AO u/s 68 of the Act is liable to be deleted. Accordingly, we set aside the order of Ld CIT(A) and direct the AO to delete the addition made in this regard. Decided in favour of assessee.
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2022 (7) TMI 1500 - ITAT HYDERABAD
Unaccounted sale of independent houses and plots - estimation of profit on suppressed turn over of the assessee shown in the return of incomes filed u/s 153A - HELD THAT:- Once it was agreed by the Assessing Officer based on the evidence that the entire sale consideration pertaining to 11 independent houses and 7 plots in the respective AYs from A.Y 2011-12 to A.Y. 2015-16 were duly shown by the assessee then the correct course would be to tax the turnover for these two years which pertain to AYs.2013-14 and 2014-15 only.
At this stage, it is useful to mention that the co-ordinate Bench of the Tribunal in the case of Sampada Homes [2018 (9) TMI 471 - ITAT HYDERABAD] had revised the rate of 40% on the total turnover and had reduced it to 10%. However, the said decision was contested by the DR for Revenue showing that it pertains to Villas issues hence cannot be relied upon. Nonetheless, it is an undisputed fact that the assessee received its share in the project which has duly been mentioned by the Assessing Officer in para 6 of his order, wherein it was mentioned that M/s. Sri Nilaya Constructions developed a venture at Badangapet in an area of 24 acres and in the return of income on pages 62, 66, the assessee had duly mentioned the profit from Sampada homes which was calculated by the assessee based on estimating the profit at 8% of the turnover.
In our view, though the co-ordinate Bench of the Tribunal had applied the rate of 10% as against 40% applied by CIT(A) on the suppressed turnover, however considering the totality of the peculiar facts of the present case, when the assessee had Admitted the total turnover in the return of income filled under section 153A and had shown profit at the rate of 8%, whereas Assessing Officer held total turnover as income of the assessee and CIT(A), we are of the opinion that rate of 15% is required to be applied as against 40% as applied by CIT(A) on the suppressed turn over of the assessee shown in the return of incomes filed u/s 153A of the Act for estimating the profit of assessee for both the years. In light of the above, grounds partly allowed.
Cash payments to Landlords - unexplained source of investment/payment made to the landlords - HELD THAT:- As the assessee had filed the documents pertaining to the assessment record, in the form of notices, explanations and orders passed in the case of M/s. Squaremile Projects showing that similar questions were posed by the AO to M/s. Squaremile Projects and thereafter the AO had deleted the additions. Therefore the revenue could not be permitted to take a contradictory stand in the case of the assessee when the relief was granted for the same transaction to M/s. Squaremile Projects.
Once all payments made to the landlords have been accepted in the case of M/s. Squaremile Projects, then it is not open to the Assessing Officer as well as ld.CIT(A) to confirm the very same amount in the hands of the assessee. The law is fairly settled that the additions should not be ordinarily made based on a statement, as the opportunity should be granted to explain his case and rebut the allegation.
In the present case, the assessee was able to explain the source of the payment made to the landowners in their case record of M/s. Squaremile Projects, though the above said was brought to the notice of CIT(A), however, ld.CIT(A) had made additions solely on the basis of the statement, which cannot be countenanced. We disapprove of it. As various documents are specifically filed in the form of additional evidence before us hence ground no 2 to 5 are remanded back to the file of AO for the limited purpose to verify additional evidence now filled before us and find out whether the undisclosed cash payment made towards the purchase of land was examined and deleted by the Assessing Officer in the case of M/s. Squaremile Projects or not and if the answer to the above question is yes then no addition should be made in the hands of the assessee. Thus, grounds allowed for statistical purposes.
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2022 (7) TMI 1499 - ITAT MUMBAI
Maintainability of appeal as the memorandum of appeal did not contain any of the grounds - HELD THAT:- The co-ordinate Bench specifically noted that form no. 36 filed by assessee did not contain any grounds either at serial no. 10 of form no. 36 or any other annexure attached to it. Therefore no grounds of appeal are filed by assessee along with both the appeals.
Assessee has also not made available any other address to the Registry at which notices can be served to it.
In view of the above facts, in absence of grounds of appeal filed by the assessee and continued non-appearance by assessee, both these appeals are dismissed as not maintainable. However, Assessee granted liberty to make an appropriate application for recall of this order if assessee submits the grounds of appeal as well as its proper address. Appeals of assessee are dismissed.
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2022 (7) TMI 1498 - ITAT AHMEDABAD
Disallowance of deferred revenue expenses - HELD THAT:- As it appears that the Ld. CIT(A) has decided the issue against the assessee relying upon the order passed by his predecessor in the case of the assessee for A.Y. 2008-09 [2015 (9) TMI 1731 - ITAT AHMEDABAD] Considering the rule of consistency and the observation made by the Revenue in that year we do not find any reason to interfere in the order impugned before us in the absence of any changed circumstances. Hence, the said ground of appeal filed by the assessee is found to be devoid of any merit and thus, dismissed.
Disallowance of miscellaneous losses and write off - Addition on the ground that the claim has not been substantiated by any documentary evidences - HELD THAT:- The issue is duly covered by assessee's own case for A.Y. 2008-09 by the Coordinate Bench [2015 (9) TMI 1731 - ITAT AHMEDABAD] which has been perused by us and since the facts are identical we find substances in assessee's submissions which has not been able to be controverted by the Ld. D.R. too. Hence, this ground of appeal is allowed in assessee's favour by deleting the addition made by the Revenue.
Income recognition on government grant & subsidy - Addition of 15% of Capital Grants as against 10% offered by assessee - HELD THAT:- We find that on the identical issue as submitted by the Ld. A.R. for A.Y. 2009-10 the Coordinate Bench has been pleased to set-aside the issue to the file of the Ld. AO for adjudication afresh for verifying the proportionate amount of grant relevant to different asset - Thus we find it fit and proper to remand the issue to the file of the Ld. AO for re-adjudication of the same and to pass orders upon verification of the proportionate amount of grant relating to different assets and to pass orders accordingly. This ground of appeal preferred by the assessee is allowed for statistical purposes.
Correct head of income - Confirming income as "other income" instead of business income interest on loans to staff - HELD THAT:- In that view of the matter we find it fit and proper to direct the Ld. AO to consider the issue afresh upon examining the same in regard to the head of income upon considering the relevant evidence in the light of the observation made in Odisha Power Generation Corporation Ltd. [2022 (3) TMI 539 - ORISSA HIGH COURT]. We, thus, pass order accordingly. This ground is allowed for statistical purposes.
Disallowance of prior period expenses - HELD THAT:- Coordinate Bench [2017 (5) TMI 1718 - ITAT AHMEDABAD] for A.Y. 1998-99 has set-aside the identical issue to the file of the Ld. AO. We are disposing of the ground by setting aside the issue to the file of the Ld. AO for de novo adjudication upon giving an opportunity of being heard to the assessee and upon considering the evidence which the assessee may choose to file at the time of hearing of the matter. This ground is allowed for statistical purposes.
Computation of brought forward business and depreciation loss - HELD THAT:- We find that the Ld. CIT(A) has not decided the issue of carry forward loss and depreciation of earlier years, hence we find it fit and proper to remit to the issue to the file of the Ld. AO to decide the same on the basis of the giving effect of appellate orders in respect of the earlier years of the assessee. This ground of appeal raised by the assessee is allowed for statistical purposes.
Nature of expenses - Guarantee fees paid to the Government of Gujarat - disallowance was made by disallowing the claim as revenue expenditure as it is of enduring nature in the assessee's business and hence capital in nature - HELD THAT:- As relying on for A.Y. 2008-09 in assessee's own case [2021 (7) TMI 1181 - ITAT AHMEDABAD] reason to interfere of the order passed by the Ld. CIT(A) in deleting the guarantee fees paid to the Government of Gujarat. The ground preferred by Revenue is, therefore, fails and thus, dismissed.
Addition of loss due to flood, cyclone, fire etc. - AO stated the sole ground for rejecting the claim in question to lack of evidence - HELD THAT:- As decided in own case [2015 (9) TMI 1731 - ITAT AHMEDABAD] for A.Y. 2008-09 lower appellate order mentions very clearly that the assessee had duly filed a letter dated 15-12-2012 comprising of all necessary details; division-wise on expenses towards flood related damages. The Revenue does not produce on record copy of the above stated letter so as to dispel the above said specific findings. The CIT(A) further relies on an identical order dealing with the very claim. The same has also gone un-rebutted in course of hearing before us. We decide this ground as well against the Revenue.
MAT computation - addition/adjustment made to the Book Profit computed u/s 115JB on account of Capital Grants claimed - HELD THAT:- We find it fit and proper to remit the issue to the file of the Ld. AO to adjudicating the issue taking into consideration the Capital Grant and subsidies and consumers contribution made by the assessee and pass orders in accordance with law upon granting a reasonable opportunity of being heard to the assessee. This ground of appeal preferred by the Revenue is allowed for statistical purposes.
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2022 (7) TMI 1497 - ITAT AHMEDABAD
TP Adjustment - sale of products by the assessee to its AE - HELD THAT:- This is the second round of litigation before us, and the matter relates to an issue which is now sixteen years old, pertaining to A.Y 2006-07, and noting more particularly the fact that the despite clear directions of the ITAT, the Revenue authorities have failed to act on the same, we are inclined to hold that the assessee, having submitted all the plausible evidences with respect to its claim of error in the TP report and the Revenue authorities having failed to examine the same, despite two opportunities before them, one by the TPO, the other by the Ld.CIT(A),the adjustment no longer is sustainable. The TP adjustment made on account of sales to AE’s is therefore directed to be deleted.
Disallowance of prior period expenditure claimed - as argued CIT(A) ought to have allowed claim of prior period expenses crystallized during the year and correctly claimed by the appellant? - HELD THAT:- Considering the fact that the assessee has been consistently debiting prior period expenses in all years, and also crediting prior period income and noting the huge turnover of the assessee, we agree that there is no revenue impact of the impugned disallowance of prior period expenses; that the exercise of making impugned disallowance would only be academic with the shifting of expenses from year to year.
The decision in the case of Adani Enterprises [2016 (7) TMI 1250 - GUJARAT HIGH COURT] squarely applies to the present case wherein it has been clearly held that where the disallowance of prior period expenses is a tax neutral exercise since the assessee incurs the same year to year with the tax rate also being the same in the years, there is no reason to make any such disallowance of prior period expenses. In view of the same, we are not inclined to uphold the disallowance of prior period expenses claimed by the assessee and direct the same to be deleted.
Adjustment on account of determination of ALP of commission allegedly paid by the AE - Receipt of commission as a notional income and not taxable - CIT(A) deleted the addition, agreeing with the contentions of the assessee that this was reversal of an expenditure on account of commission debited by the assessee in its books of accounts - HELD THAT:- We do not find any infirmity in the order of the Ld.CIT(A) who after appreciating all the evidences before him recorded a finding of fact that no commission was earned by the assessee and that the entry in the books of Atul Ltd (AEL) only pertained to reversal of commission income booked by it in earlier years as earned from the assessee.
We find that the Ld.CT(A) has rightly dealt with this aspect pointing out that taking note of these very evidences the ITAT had in the first round restored the matter to the AO to consider the issue in the light of the explanation of the assessee. CIT(A) we agree ,has rightly held that these evidences therefore could not be rejected merely for the reason they were not produced earlier. No other infirmity being pointed out in the evidences ,we agree with the CIT(A) that the assessee has duly substantiated his explanation that the alleged commission income recorded in the name of the assessee in the Books of Atul Ltd.(AEL) was in fact only a reversal of earlier commission expenses booked by it on account of the same no longer being required to be paid. Thus no reason to interfere in the order of the Ld.CIT(A) deleting the adjustment on account of determination of ALP of commission allegedly paid by the AE to the assessee.
Adjustment on quantity discount claimed by holding that discount to the AEs is as per the commercial policy of the assessee company - International transaction of purchase of goods from AE’s on account of quantity discount given to them by the assessee - HELD THAT:- CIT(A) has noted to the effect that the assessee had demonstrated its commercial policy with regard to quantity discount to be given to both its AE and non-AE by submitting data in this regard before him. We have further find that the ld.CIT(A) had also noted that even the AO had accepted quantity discount given by the assessee in all except four cases on the basis of existing instances of commercial policy in this regard of the assessee; that noting so, he held, having accepted existing commercial policy of the assessee to grant quantity discount and the assessee having exhibited existence of such quantity discount vis-à-vis both of its AE and non-AE, therefore, the claim of the assessee of having paid quantity discount was substantiated and proved to be at ALP. DR was unable to point out any infirmity in the above finding of the ld.CIT(A) - Thus uphold the order of CIT(A) allowing the claim of the quantity discount paid to its AE. This ground is rejected.
Addition u/s 14A r.w.r. 8D - disallowance of expenses incurred in relation to earning of exempt income - HELD THAT:- In the case before us, it is an admitted case of the assessee itself before the lower authorities that disallowance, if any, at best can be to the extent of Rs. 2,25,000/- and a working to this effect was also admittedly filed before the CIT(A). CIT(A) has given finding that the disallowance has been worked out on a scientific basis by the CA who has submitted a report in this context. The ld.DR was unable to controvert the above fact. In view of the same, we see no reason to interfere in the order of the ld.CIT(A) restricting the disallowance under section 14A to Rs. 2,25,000/-.
Addition on account of excess depreciation claimed is upheld.
Disallowance of deduction u/s 80IA on the new power plant of the assessee upheld.
Enhance book profit u/s 115JB by the amount disallowed u/s 14A r.w. Rule 8D - HELD THAT:- This issue has been decided in favour of the assessee by the Special Bench of the ITAT in the case of ACIT Vs. Vireet Investment Pvt. Ltd [2017 (6) TMI 1124 - ITAT DELHI] Thus the order of the ld.CIT(A) allowing the assessee’s claim of no adjustment to be made to the book profits on account of disallowance of interest under section 14A of the Act is upheld.
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2022 (7) TMI 1496 - DELHI HIGH COURT
Income taxable in India - Payments received were taxable as royalty as per Section 9(1)(vi) or Article 12 of DTAA and USA - HELD THAT:- In the opinion of this Court, the aforesaid issue is no longer res integra in Engineering Analysis Centre of Excellence Private Limited [2021 (3) TMI 138 - SUPREME COURT] as held that amounts paid by resident Indian end-users/distributors to non-resident computer software manufacturers/suppliers, as consideration for the resale/use of the computer software through EULAs/distribution agreements, is not the payment of royalty for the use of copyright in the computer software, and that the same does not give rise to any income taxable in India, thus not liable to deduct any TDS u/s 195 - Decided in favour of assessee.
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2022 (7) TMI 1495 - CUSTOMS AUTHORITY FOR ADVANCE RULINGS, MUMBAI
Project Import - Classification of imported goods - solar power project would fall within the ambit of a power plant/transmission project or not - eligibility for concessional rate of customs duty under N/N. 230/1986-Cus., dated 03.04.1986, as amended - HELD THAT:- The applicant is in the business of generating electricity using PV cells and modules, therefore, they contend that the proposed solar plant projects to be setup in the state of Maharashtra would squarely fall within the purview of term 'power plant' and would be eligible for benefit under heading 98.01 of the first schedule to Customs Tariff Act read with Project Import Regulations subject to fulfilment of the prescribed conditions and procedure therein. The applicant has also stated that the benefit of project import regulations has been extended to many private sector undertakings who have executed power projects.
The law doesn't restrict the concessional rate of import duty on project imports to any specific power plant. Electrical power can be obtained from different sources, e. g., hydro-electric, thermal, nuclear, wind, solar etc. The entry at sr. no. 3 of the table annexed to the notification no. 230/86-Cus., dated 03.04.1986 only shows that the sponsoring authority in case of power plants and transmission projects would be the secretary to the government of the state/union territory dealing with the subject of power or electricity. Therefore, the clear language of the notification is that the exemption would be available to all power plants. An interpretation to restrict such benefit to any particular type of power plant would therefore, be perverse.
The applicant, being a private undertaking and engaged in setting up of solar power plants is eligible to import goods at concessional rate of duty under sub-heading 98010013 of the first schedule to the Customs Tariff Act, 1975 (51 of 1975) read with project Import Regulations, 1986 subject to fulfilment of conditions prescribed therein.
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2022 (7) TMI 1494 - ITAT COCHIN
Late filing fee u/s 234E - late filing of TDS return - AR submitted that the assessee is maintaining cash system of accounting and due to some technical mistake TDS return was filed in Form 24Q2 on 20.10.2017 later on the mistake was rectified through filing of revised quarterly TDS return and filed the return in Form 26Q which was within the due date, therefore the levy of fee u/s 234E does not arise - HELD THAT:- We observe that the assessee filed quarterly TDS return in Form Q24 which has been processed By the CPC on 30.06.2018 and raised demand towards interest of late payment of Rs.567/- and late filing fee under Section 234E of Rs.47,000/-. During the course of hearing the learned A.R. submitted acknowledgement of quarterly statement which is a computer generated Form 24Q and it was filed on 20.10.2017.
From the orders of the lower authorities it is clear that the assessee has filed Form 24Q on 20.10.2017 and it was got revised later on but the lower authorities had not considered the original quarterly TDS return filed in Form 24Q and it has been considered from the date of revised return and imposed interest and late fee for delayed filing and payment.
Assessee was unable to produce before us the other particulars regarding filing of Form 20Q & 24Q and what was the data contained in Form 24Q and 26Q. He only submitted that the assessee is maintaining cash system of accounting. Therefore we think it fit to remit the matter to the AO for verification of the exact nature of the payment and which form is applicable, i.e. 24Q or 26Q in the case of the assessee.
Appeal filed by the assessee is allowed for statistical purposes.
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2022 (7) TMI 1493 - MADRAS HIGH COURT
Filing of sale certificates in Book No. 1 as per Section 89(2) or 89(4) of the Registration Act, 1908 - sale certificates were not issued by the Revenue officer, yet, a direction for filing a copy in Book No. 1 has been given - HELD THAT:- Section 89 of the Act of 1908 provides for sending copies of certain orders, certificates and instruments to the registering officers. The purpose of Section 89 of the Act of 1908 is different than as understood by the appellants. It is not for registration of document requiring stamp duty and keeping a copy of the sale certificate on the file of Book No. 1. The document therein is not presented by the purchaser, but sent by the court or the Revenue Officer.
The judgment in N. NARESH KUMAR VERSUS THE INSPECTOR GENERAL OF REGISTRATION, OFFICE OF THE INSPECTOR GENERAL OF REGISTRATION, CHENNAI AND THE SUB REGISTRAR, SUB REGISTRAR OFFICE, TRICHY [2018 (8) TMI 2140 - MADRAS HIGH COURT], makes it clear that it does not amount to registration, rather if the document is to be used for sale or any other purpose, stamp duty is to be paid for registration of the document at that stage. Section 17(2)(xii) of the Act of 1908 excluded document from compulsory registration if the certificate of sale is granted to the purchaser by the Civil or Revenue Officer.
In the case of B. ARVIND KUMAR VERSUS GOVERNMENT OF INDIA AND ORS. [2007 (5) TMI 657 - SUPREME COURT], the Apex Court thus gave a reference of Section 17(2)(xii) of the Act of 1908 to indicate that a sale certificate does not require compulsory registration and for that no separate deed is to be executed.
The writ petitions were filed when the sale certificate sent to the registering officer was not filed in Book No. 1 on the ground that stamp duty has not been paid. The appellants have failed to understand the import of Sections 17(2)(xii) and 89 of the Act of 1908, which does not require registration of sale certificate, but for filing a copy in Book No. 1. At this stage, it is necessary to clarify that the court granting certificate of sale would fall under Section 89(2) of the Act of 1908, while if it is granted by the Revenue officer, it would be under Section 89(4) of the Act of 1908 and the case on hand would fall under Section 89(2) and not under Section 89(4) of the Act of 1908.
The action of the appellants to demand stamp duty to keep a copy of the sale certificate on the file of Book No. 1 is going against the statutory mandate and the law enunciated by the Apex Court and this Court.
The writ appellants have even ignored Section 17(2)(xii) which excludes sale certificate from compulsory registration if granted by the Civil or Revenue officer. In a case where certificate is granted by the Civil officer apart from Revenue Officer, registration would not be compulsory, thus till it is not presented for registration, the question of stamp duty would not arise. It would be true that as per Section 35 of the Indian Stamp Act, 1899 such document would not be admissible in evidence.
There are no merit in the writ appeals and are dismissed.
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