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Showing 1 to 20 of 1322 Records
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2023 (4) TMI 1323 - ITAT PUNE
Income from Other Sources u/s 56(2) - interest received u/Sec. 28 of the Land Acquisition Act, 1894 - assessee’s case before us is that such an interest income is part of the land acquisition compensation itself and not taxable - HELD THAT:- It transpires that the instant issue of taxability of the assessee’s interest income received under section 28 of the Act is covered in assessee’s favour as per the hon’ble high court’s Bombay bench Shri Rupesh Rashmikant Shah Versus Union of India & Ors. [2019 (8) TMI 518 - BOMBAY HIGH COURT] holding that the same is not taxable under section 56(2)(viii) of the Act as against the Revenue’s contentions that the Aurangabad bench of the very hon’ble jurisdictional high court has taken a divergent view against the taxpayer in Shivajirao and Others Vs. State [2013 (8) TMI 1160 - BOMBAY HIGH COURT]
Faced with the situation, we are of the opinion that it is the Bombay and not Aurangabad bench of the hon’ble jurisdictional high court whose decision would prevail in the given facts and circumstances as the assessee, his land/capital asset forming subject matter of compulsory acquisition as well as “situs” of the Assessing Officer who has framed assessment before us are covered within its territorial jurisdiction notified from time to time. We thus quote PCIT Vs. ABC Paper Limited [2022 (8) TMI 863 - SUPREME COURT] and decide the instant sole substantive ground as well as the main appeal is assessee’s favour.
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2023 (4) TMI 1322 - ITAT MUMBAI
TP Adjustment - ALP of royalty and branding fees - TPO has determined ALP at 'Nil' holding that for any such transactions, no brand fee is paid by any independent enterprise and assessee has used TNMM method for computing the arm's length price by comparing the net profit margin of the company at entity level with that of the other permanent entities - HELD THAT:- We find that this issue has been dealt by the Tribunal in A.Y.2002-03 in [2013 (11) TMI 927 - ITAT MUMBAI] as held in the broking business, brand does promote the business and as rightly observed by CIT(A) it is one of the profit drivers within the industry. Thus it cannot be said that the assessee had not derived any benefit from use of brand. We also find that the AO without any detailed examination as to why other CLSA entities were not making any payment of royalty, rushed to apply the CUP method which as we have held could not be applied for the lack of proper information. CIT(A) has examined the matter in detail as to why other CLSS entities were not paying royalty which was because of the fact that CLSA had different arrangement in different jurisdictions. CLSA was present in 13 markets out of which India, Korea and Taiwan had capital market regulation which required FIIs to contract directly with a domestic CLSA entity. In other jurisdictions, a single contract model was followed
CIT(A) on examination of the arrangement/system followed by CLSA BV has also given a finding that in other jurisdictions, CLSA entities were making market contributions. Therefore only on the ground that other CLSA units did not pay any royalty, it could not be held that payment of royalty by the assessee was not justified. 8.4 CIT(A) has also examined the business development system followed by other comparable companies in India and has given a finding that these companies on average were incurring business development expenditure which was 6.4% of brokerage turnover whereas similar expenditure incurred by the assessee was only 1.28% including royalty of 1% paid by the assessee. Therefore expenditure incurred by the assessee on royalty and business development could not be considered as excessive compared to the comparable parties.
Thus apart from that, similar observation and finding has been given in A.Y.2003-04 [2020 (12) TMI 815 - ITAT MUMBAI] Thus, consistent with view taken in the earlier years, the royalty payment of 1% is accepted and adjustment made by the ld. TPO is deleted.
Benchmarking referral fees and reimbursement of indirect overhead expenses - Assessee has benchmarked both payment of referral fees and reimbursement of indirect overhead expenses by using TNMM as the Most Appropriate Method and concluded that they are at ALP. The assessee has justified that sale efforts, research activities and IT infrastructure are the main functions responsible for earning of brokerage income from clients. Accordingly, payment of referral fees and indirect overhead expenses reimbursement is closely inter linked to the assessee's business and therefore, was benchmarked using TNMM by considering assessee as a tested party. TPO cannot benchmark the 'referral fee' at Nil and accordingly, adjustment made by the ld. TPO is deleted on similar reasoning. Accordingly, grounds are allowed.
Indirect overhead expenditure - again this issue is covered by the assessee's own case for A.Y.2003-04, [2020 (12) TMI 815 - ITAT MUMBAI] wherein it has been held that ad-hoc TP addition without following any one of the prescribed method is not sustainable which has been discussed in detail in para 19 of the ITAT order cited supra. Apart from that, we find that the assessee has benchmarked the transaction using TNMM, which is one of the prescribed methods as per Section 92C. Further, the assessee has also provided a supplementary and detailed analysis by way of the AUP report which certifies that only costs attributable to the assessee have been reimbursed to the AE.
Against the scientific approach adopted by the assessee, the ld. TPO has merely resorted to ad-hoc approach and without following any one of the prescribed methods determined ALP of reimbursement of indirect expense overheads as Nil. Thus, the addition of this adjustment made on account of reimbursement of indirect overhead expense is also directed to be deleted. - Decided in favour of assessee.
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2023 (4) TMI 1321 - SC ORDER
Classification of goods - hook and eye for brassieres - whether classified under CTH 83081010 as claimed by the appellant or under CTH 62129090 as part of brassieres as arrived at by the assessing officer? - Tribunal held that the appellants have successfully demonstrated that the import documents describe the product to be ‘Hooks and eye’ for the Brassieres; other importers are also claiming the classification under the same heading - Such overwhelming evidence cannot be overlooked - the impugned goods are rightly classifiable CTH 83081010 - HELD THAT:- The civil appeal is dismissed on the ground of delay as well as on merits.
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2023 (4) TMI 1320 - SUPREME COURT
Cancellation of bail granted - mens rea for committing the crime punishable under Sections 39 and 40 of the Unlawful Activities (Prevention) Act, 1967 - fulfilment of conditions of Section 43D of the said Act - HELD THAT:- The provisions of Section 43D (5) of the said Act have been considered by this Court in the case of Thwaha Fasal [2021 (10) TMI 1430 - SUPREME COURT]. The Court, after reproducing the provisions of Section 43D (5) and after considering the judgment of this Court in the cases of National Investigation Agency v. Zahoor Ahmad Shah Watali [2019 (4) TMI 2023 - SUPREME COURT] and Ranjitsing Brahhmajeetsing Sharma v. State of Maharashtra and Another [2005 (4) TMI 566 - SUPREME COURT], held that while deciding a bail petition filed by the accused against whom offences under Chapter IV and VI of the said Act have been made, the Court has to consider as to whether there are reasonable grounds for believing that the accusation against the accused is prima facie true.
The additional requirement, as provided under subsection (5) of Section 43D of the said Act is twin. The first one being that the public prosecutor has to be given an opportunity of being heard. The second one, that the Court is of the opinion that there are reasonable grounds for believing that the accusation against such a person is prima facie true.
Undisputedly, in the present case, the first requirement has been complied with. Insofar as the second requirement with regard to Court arriving at a satisfaction that the accusation against such persons is prima facie true is concerned, it is not required to go into the elaborate discussion of the evidence, inasmuch as that may hamper the rights of the parties at the stage of trial.
A perusal of Sections 39 and 40 of the said Act would itself reveal, that for an act to constitute as an offence within the meaning of that Section, it has to be done with the intention of furthering the activities. This Court, in the case of Thwaha Fasal, while considering the provisions of Section 39 of the said Act, has also taken a similar view.
An interference by an Appellate Court and particularly in a matter when liberty granted to a citizen was being taken away would be warranted only in the event the view taken by the Trial Court was either perverse or impossible.
The impugned orders are quashed and set aside and the appeals are allowed.
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2023 (4) TMI 1319 - SC ORDER
Exemption from Service Tax - work contract service other than those which are commercial in nature rendered to the Central / State Government, Local Statutory Authorities etc. - Entry 12(a), (c) & (f) in Mega Exemption Notification No.25/2012-Service Tax, dated 20.06.2012 - validity of Notification No.6/2015-Service Tax, dated 01.03.2015 - it was held by High Court that The prayer for a direction to refund of tax already paid by the petitioner also cannot be countenanced as these petitioners are liable to tax - HELD THAT:- There are no reason to interfere with the impugned judgment and order of the High Court. The special leave petitions are dismissed.
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2023 (4) TMI 1318 - SUPREME COURT
Change in Law relief on account of New Coal Distribution Policy, 2013 (NCDP 2013) - should be on actuals viz. as against 100% of normative coal requirement assured in terms of New Coal Distribution Policy, 2007 (NCDP 2007) or restricted to trigger levels in NCDP 2013 viz. 65%, 65%, 67% and 75% of ACQ? - for computing 'Change in Law' relief, the operating parameters should be considered on 'actuals' OR as per technical information submitted in bid? - 'Change in Law' relief compensation is to be granted from 1st April 2013 (start of Financial Year) or 31st July 2013 (date of NCDP 2013)?
HELD THAT:- The 'Change in Law' happens to be by way of adoption, promulgation, amendment, re-enactment or repeal of the law or 'Change in Law', it has to be effected from the date on which such change occurs.
This Court has clearly held that the DISCOMS have a contractual obligation to make timely payment of the invoices raised by the power generating companies, subject to scrutiny and verification of the same. This Court has rejected the contention that the funding cost was much lesser than the rate of LPS. This Court has reiterated the proposition that the courts cannot rewrite a contract which is executed between the parties. This Court has emphasized that it cannot substitute its own view of the presumed understanding of commercial terms by the parties, if the terms are explicitly expressed. It has been held that the explicit terms of a contract are always the final word with regard to the intention of the parties.
This Court has reiterated that once carrying cost has been granted, it cannot be urged that interest on carrying cost should be calculated on simple interest basis instead of compound interest basis. It has been held that grant of compound interest on carrying cost and that too from the date of the occurrence of the 'Change in Law' event is based on sound logic. It has been held that it is aimed at restituting a party that is adversely affected by a 'Change in Law' event and restore it to its original economic position as if such a 'Change in Law' event had not taken place.
The argument that there is no provision in the PPAs for payment of compound interest from the date when the 'Change in Law' event had occurred, has been specifically rejected by this Court.
In view of this consistent position of law and application of restitutionary principles and privity of contractual obligations between the parties as contained in the PPAs, it is not found that the view taken by the learned APTEL with regard to carrying cost warrants interference.
Thus, this Court should be slow in interfering with the concurrent findings of fact unless they are found to be perverse, arbitrary and either in ignorance of or contrary to the statutory provisions.
Appeal allowed.
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2023 (4) TMI 1317 - CESTAT MUMBAI
Disallowance of Credit of Education Cess and Secondary and Higher Education Cess - denial of credit on the ground that the goods were supplied to them by 100% EOU M/s Viraj Profiles Ltd. and as per Rule 3(7)(a) of Cenvat Credit Rules, 2004, the assessee receiving goods from 100% EOU can avail credit of Basic Excise Duty only as per the formula prescribed there under.
HELD THAT:- The issue is no more res integra and is squarely covered by several decisions of this Tribunal. In the case of EMCURE PHARMACEUTICALS LTD. VERSUS COMMISSINOR OF C. EX., PUNE [2008 (1) TMI 147 - CESTAT, MUMBAI] where it was held that Rule 3(7)(b) also opens with the non-obstante clause. Therefore, if the interpretation canvassed by the Revenue is accepted as correct, there would have been no question of utilisation of education cess for payment of education cess if the taking of the credit itself, according to the Revenue, is barred by Rule 3(7)(a), and the provisions of Rule 3(7)(b) would, therefore, be rendered redundant.
The facts of the present case are similar to the facts considered in the aforesaid decision of the Tribunal and therefore, the contention that Education Cess is a surcharge which relates in enhancement of the tax, is agreed upon. Further the objective was not to levy excise duty on goods cleared by EOU. The question of adding Education Cess under Section 93 of the Finance Act,1944 after determination of the aggregate of customs duty does not arise.
The impugned order is set aside and the appeal filed by the Appellant is allowed.
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2023 (4) TMI 1316 - CESTAT NEW DELHI
Seeking withdrawal of appeal - full and final settlement of the dues - HELD THAT:- A certificate in Form IV has been issued to the appellant regarding full and final settlement of the dues. The appeal, therefore, stands dismissed as withdrawn.
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2023 (4) TMI 1315 - DELHI HIGH COURT
Money Laundering - predicate/scheduled offence - illegal racket of kidney transplantation - offences including the offences punishable under Section 307 of the Indian Penal Code, 1860 and Sections 18, 19 and 20 of the Transplantation of Human Organs Act, 1994 - whether acquittal of the accused i.e., Jeevan Kumar from the predicate offence and quashing of criminal proceedings mentioned above qua the appellant-Rajiv Channa, shall also lead to the cessation of the attachment proceedings? - HELD THAT:- For the commission of an offence of money laundering, the essential preconditions which emerge from the aforesaid provisions are that firstly, it requires an involvement in any process or activity connected with the proceeds of crime; and secondly, projection of the same as untainted property.
The proceeds of crime allude to any property derived or obtained, directly or indirectly, by any person as a result of criminal activity relating to a scheduled offence. It may also include the value of any such property or in cases where such property is taken or held outside the country, then the property equivalent in value held within the country or abroad. The Explanation to Section 2(1)(u) of PMLA, 2002 further clarifies that the proceeds of crime would include property not only derived or obtained from the scheduled offence but also any property which may directly or indirectly be derived or obtained as a consequence of any criminal activity pertaining to the scheduled offence.
In Nik Nish Retail Ltd. v. Assistant Director, Enforcement Directorate [2022 (11) TMI 1280 - CALCUTTA HIGH COURT], the Calcutta High Court, while dealing with a case where the FIR in respect of the predicate offence was quashed on the basis of settlement has held that the proceedings initiated under PMLA, 2002 provisions cannot stand in isolation in the absence of any scheduled offence.
This Court, in the case of Prakash Industries Ltd. v. Directorate of Enforecement [2022 (7) TMI 877 - DELHI HIGH COURT], has taken a view that once it is found that a criminal offence does not stand evidenced, the question of any property being derived or obtained therefrom or its confiscation or attachment would not arise at all.
A bare perusal of the facts of the present case would show that the Trial Court had already acquitted the appellant-Jeevan Kumar of all the charges framed against him vide judgment dated 22.03.2013 and the same has remained unchallenged by the respondent. Therefore, his acquittal in the scheduled offence breaks the entire chain leading to the other appellants. Moreover, this Court, vide judgment dated 15.01.2024, had quashed the ECIR bearing no. ECIR/07/DZ/2008 alongwith all the consequential proceedings arising therefrom, and the charge framed qua the appellant-Rajiv Channa vide order dated 24.04.2012. Thus, a necessary corollary would be that all the proceedings in furtherance of prosecution, including attachment, would also fall and are therefore, liable to be quashed.
The attachment proceedings in the present case are unsustainable as the appellants cannot be said to be involved in any activity connected with the proceeds of crime - Appeal disposed off.
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2023 (4) TMI 1314 - SC ORDER
Challenge to impugned assessment order - violative of the principles of natural justice or not - petitioner submits that the issue raised in this petition is squarely covered by a judgment in BAKSHI MOTORS VERSUS ASSISTANT COMMISSIONER (ST) [2022 (12) TMI 1503 - ANDHRA PRADESH HIGH COURT] where it was held that Having found that the petitioner filed this writ petition against the impugned assessment order without availing the alternative remedy available to him, without expressing our view on the merits of the case, we are inclined to dispose of the writ petition affording opportunity to the petitioner to approach the appellate authority.
HELD THAT:- Issue notice returnable within four weeks.
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2023 (4) TMI 1313 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , PRINCIPAL BENCH , NEW DELHI
Seeking recall of order - power of recall - application filed by the RBI was barred by Section 10A of IBC or not - HELD THAT:- The power of recall can be exercised if there is any procedural error committed by the Court or order was obtained by playing fraud on the Court. The present is not a case where any procedural error has been committed by the Adjudicating Authority by passing the order dated 08.10.2021. Counsel for the Appellant has advanced submission that order dated 08.10.2021 is in violation of principle of natural justice which submission is wholly unfounded.
Bar of Section 10A - submission is that there is apparent error on the record since default noticed in the order was during 10A period but the Adjudicating Authority ignoring the bar of Section 10A has admitted 10A application - HELD THAT:- The present is a case where Appellant exercised its right of appeal and failed. Appellant who have challenged the order on merits in which he has been unsuccessful, cannot be allowed to file an application to recall the order on the same ground on which the appeal was filed by the Appellant. It is true that the Appeals filed by the Appellant were dismissed due to rejection of the application praying for condonation of 321 days’ delay in refiling the appeal but in the recall application, the ground to challenge the order on which appeal was founded are now being agitated in the Appeal - The IBC is a statute which prescribes timelines for completion of the proceedings. The recall applications have been filed after 17 months of admission of application under Section 227 filed by the RBI that too after unsuccessful challenge by the Appellant to the order dated 08.10.2021 before this Tribunal as well as before the Hon’ble Supreme Court. The Adjudicating Authority has correctly observed in the impugned order that there were no grounds made out in the applications filed by the Appellant for recall of the judgment dated 08.10.2021.
Thus, no error was committed by the Adjudicating Authority in rejecting recall applications - there is no merit in the Appeals - appeal dismissed.
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2023 (4) TMI 1312 - NATIONAL COMPANY LAW TRIBUNAL HYDERABAD
Seeking for an order for liquidation of the Corporate Debtor (CD) - Section 33(1) read with section 34(1) of the Insolvency & Bankruptcy Code, 2016 - HELD THAT:- The fact remains that there is no resolution plan pending before the CoC and in the 18th CoC meeting, the RP explained to the CoC that in the event, the NCLT, Hyderabad does not accede to the request of granting further extension of 60 days, the liquidation process u/s 33(1) of Code shall commence in line with the order dated 31/12/2020. The ld. Counsel for the petitioner relies on this part of the Minutes of the 18th CoC meeting to contend that resolution of the CoC has to be deemed as being made, since CoC also noted the explanation given by the RP with regard to the liquidation. However, the Hyderabad Bench of NCLT, in the similar circumstances, has ordered for liquidation without the resolution of the CoC for liquidation. The adjudicating authority considered that no resolution plan was pending before CoC and that the adjudicating authority did not receive any resolution plan under sub-section (6) of Section 30 of the I&B Code, 2016.
When under section 33(1)(a), the Adjudicating Authority has power to order for liquidation when no resolution plan is submitted to it, it implies that the Adjudicating Authority has to only see whether any resolution plan has come up before it for approval prior to the order for liquidation under section 33(1)(a). As no resolution plan is received by the Adjudicating Authority, the questions whether CoC has resolved for liquidation or whether there is no coordination between RP and CoC, are immaterial for the Adjudicating Authority to order for liquidation u/s 33(1)(a).
There are no reason to reject the request made by the RP to order for liquidation of the Corporate Debtor - application allowed.
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2023 (4) TMI 1311 - DELHI HIGH COURT
Seeking permission to travel for two business meetings and for meeting his daughter in the USA - Ongoing investigations under the Black Money Act and the Potential risk posed by the petitioner's travel, particularly to the USA. - HELD THAT:- Bearing in mind the overall facts and circumstances of this case and the cooperation which has been extended by the Petitioner from time to time in terms of participation in the investigation and the two ld. Division Bench orders, and keeping in mind that the Court has vide three previous orders wherein granted the permission to travel abroad, the Court grants permission to the Petitioner to travel abroad in terms of the itinerary recorded above, subject to the conditions imposed - application disposed off.
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2023 (4) TMI 1310 - DELHI HIGH COURT
Taxability of centralized services fee earned by assessee - Tribunal held it not taxable as fee concerns various aspects, such as sales and marketing, loyalty programs, reservation service, technological service, operational service and training programs/human resources - HELD THAT:- Tribunal has noted, that the issue stands covered by the judgment of the coordinate bench in the case of Sheraton International Inc. [2009 (1) TMI 27 - DELHI HIGH COURT]
As in the assessee’s case for other AYs, the coordinate bench has followed the same approach i.e., accepted the ratio of the judgment in Sheraton International Inc. No substantial question of law arises for our consideration.
The appellant/revenue has preferred an appeal qua the judgment rendered by the Division Bench of this Court in Sheraton International Inc., it is made clear, that if the appellant/revenue were to succeed in the said matter, parties will abide by the final decision rendered by the Supreme Court.
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2023 (4) TMI 1309 - RAJASTHAN HIGH COURT
Seeking grant of bail u/s 439 CrPC - economic offence Or not - Offence punishble under Sections 132 (1) (b), (f), (h), (j), & (l) of Central Goods and Services Tax Act, 2017 - HELD THAT:- It is an admitted position that petitioner had evaded the tax and got the benefit of input tax credit of nearing Rs.88.33 Crores. Hon’ble Apex Court in various pronouncement observed that economic offender should not be dealt as a general offender and in circumstances while granting bail to Vinay Kant Ameta directed him to deposit Rs.200 Crores.
Thus, the bail application is allowed.
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2023 (4) TMI 1308 - CALCUTTA HIGH COURT
Revision u/s 263 - proceedings initiated based on a proposal received by the assessing officer - Inadeqaute or no enquiry done by AO - HELD THAT:- We find that the assessing officer has specifically recorded in the assessment order u/s 143(3) that during the course of assessment proceedings, the assessee was asked to explain the books of accounts, bills and vouchers and the authorised representative of the assessee filed the relevant documents in detail with many explanations which were examined by the assessing officer and verified with the books of accounts and the heard copies of the ITR and audited accounts and thereafter, the assessment was completed.
From the notice issued u/s 142(1) it is seen that as many as 21 particulars/documents were called upon to be produced by the assessee of which the document/observations in item No. 20-21 are relevant for the purpose of this case, they being (i) large increase in investment in unlisted equities during the year and (ii) low income in comparison to very high investment.
It is seen that first issue on which the information was called for by the assessing officer has not been taken as a ground by the PCIT while assuming jurisdiction u/s 263. Thus it has to be seen as to whether assessee had furnished the requisite information with regard to the second issue namely low income in comparison to very high investments.
The assessee had placed before the assessing officer many submissions in which the detail explanation has been given with regard to the said issue apart from placing reliance on various decisions of the Hon’ble Supreme Court as well as the High Courts.
Apart from that, a separate reply had also been given dealing with all the twenty-one issues. Thus it cannot be said that assessing officer did not conduct any enquiry in the matter with regard to the issue on which the PCIT had exercised jurisdiction under 263 of the Act.
It may be true that a proposal had been received by the PCIT from the assessing officer. However, solely based on the proposal, action could not have been initiated u/s 263 as the statute mandates that PCIT should enquire and be satisfied that the case warrants exercise of its jurisdiction u/s 263. Such satisfaction should be manifest in the show-cause notice which is issued u/s 263 of the Act.
We find in the instant case the word used by the PCIT is “prima facie”. Thus based on prima facie view the PCIT accepted the proposal of the assessing officer and initiated action u/s 263 of the Act. The decisions of the Hon’ble Courts on the point clearly holds that the satisfaction of the PCIT is essential. Though the Tribunal has knowledge of those facts as also the order sheet maintained by the assessing officer which records that on 19.09.2017 the authorised representative of the assessee had appeared and produced the books of accounts, bills vouchers etc and they were test checked and the case was discussed with the authorised representative of the assessee. If that be so, it could not have been stated that there was any lack of enquiry on the part of the assessing officer. Tribunal also admits that a paper book containing 124 pages of documents were also placed. Thus it is a case where the assessing officer had raised specific query and the case was discussed with the authorised representative of the assessee and thereafter decision has been taken.
Thus in absence of any satisfaction recorded by the PCIT that the order of assessment was both erroneous and prejudicial to the interest of revenue, the Tribunal ought to have granted relief to the assessee and faltered the PCIT for having exercised its jurisdiction. Assessee appeal allowed.
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2023 (4) TMI 1307 - PUNJAB AND HARYANA HIGH COURT
Reopening of assessment u/s 147 - nature of expenses - upgradation and development of various softwares - notice issued after a period of 4 years - assessee did not provide any explanation as to why the said expenses should be considered as revenue and not capital expenditure and the assessing officer had recorded reasons - HELD THAT:- After more than 4 years, the only reason for initiating reassessment proceedings is that only 30% to 60% depreciation could be given and rest of the amount is to be taken as capital. This change of opinion cannot be made a ground for reassessment.
Once, the AO had accepted the return and treated above said expenditures as revenue as these were incurred only to facilitate the business of the assessee who is engaged in the business of advertising and marketing communications. Further, the expenditures were disclosed at the time of making original assessment which were rightly treated as revenue. Thus after a period of 4 years, only on account of change of opinion, re-assessment proceedings cannot be initiated. In Kitchen Express Overseas Ltd.'s case [2017 (12) TMI 1127 - GUJARAT HIGH COURT] it has also been held that any expenditure incurred on purchase of software, software developments and services to facilitate existing infrastructure is to be taken as revenue and not capital.
Thus writ petition is allowed and initiation of re-assessment proceedings are set aside on both the counts i.e. delay and merits. Decided in favour of assessee.
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2023 (4) TMI 1306 - DELHI HIGH COURT
Money Laundering - Provisional attachment order - predicate offences - subject property is involved in any money laundering activities or not - Section 8(2) first proviso of the PMLA Act - HELD THAT:- The predicate offence in the present case are acts of criminal breach of trust and forgery by the accused persons with respect to the credit facilities provided by the Appellant/Bank between the years 2007-2018. The issue as to whether the commission of the offence between 2007-2018 overlaps or is prior to the creation of mortgage can be adjudicated by the authorities under the PMLA Act and this Court, at this juncture, is not inclined to go into that question. This Court, therefore, does not find any reason to interfere with the order of the learned Single Judge who has also not commented on this question and has left the matter to the authorities under the PMLA Act to consider the issue.
It is well settled that when a statute prescribes a particular mode or a mechanism for adjudication of disputes arising out of that statute, then writ Courts must loathe in interfering the mode prescribed in that stature.
The scheme of the PMLA Act provides for mechanism beginning with a Provisional Attachment Order (PAO) attaching the property which is then confirmed by the Adjudicating Authority under Section 8(2) of the Act. When a property stands confiscated, a trial is conducted by the Special Court and in accordance with Section 8(8) of the Act, the Special Court may direct Central Government to restore such confiscated property. Therefore, this Court is of the view that the Appellant/Bank has an alternate efficacious remedy within the scope of the Act - This Court, therefore, does not find any infirmity in the judgment of the learned Single Judge in relegating the Appellant/Bank to the Adjudicating Authority to ventilate its grievances under Section 8(2) of the PMLA Act and the same does not require interference and is accordingly upheld.
Application dismissed.
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2023 (4) TMI 1305 - GUJARAT HIGH COURT
Validity of Reopening of assessment u/s 147 - claim under CSR (Corporate Social Responsibility) expenses made was otherwise not allowable and as such, the said claim deserves to be disallowed and to that extent, income of the petitioner has escaped assessment - reliance on audit party opinion - HELD THAT:- As a matter of records, the petitioner has made average net loss of Rs. 187.67 crores during three immediately preceding Financial Years and as such, the petitioner was not under obligation to spend any amounts toward CRS by virtue of Section 135 of the Act and as such, the expenditure incurred by the petitioner is not the one which requires disallowance under explanation 2 to Section 37 (1). The expenditure incurred is out of Commercial expenses and is fully allowable and further it is the stand of the petitioner that even it is not the case of revenue that expenditure if any for explanation 2 to Section 37 is not allowable expenditure and as such, the fundamental error appears to have been crept in.
At this stage, reliance which has been made by the learned advocate appearing for the petitioner about the decision passed by the co-ordinate Bench of this Court in the case of Adani Power Maharashtra Limited [2023 (3) TMI 987 - GUJARAT HIGH COURT] where-in also this issue has been the subject matter of consideration and in which notice for re-opening and the order rejecting the objections came to be set aside.
Re-opening on the basis of audit party objection - As submitted that one of the Director of the Company submitted an application u/s 6(3) of the Right to Information Act seeking information as to objection raised by the audit party and the reply of the same was given by assessing officer. The said information was provided in the form of order dated 10.12.2021 issued u/s 7(1) of the Right to Information Act, it appears that step of re-opening is on the basis of the objection raised by the audit party as can be seen from paragraph 3 of the said page 117 in the case of this very petitioner and as such, also when the co-ordinate Bench has dealt with the issue as to whether on the strength of audit objections, re-opening of assessment is permissible or not is clearly clinching the issue raised in the present proceedings and hence, we answer in negative against the revenue.
Re-opening of the assessment is on the basis of the change of opinion - As detailed scrutiny was undertaken and after satisfying himself, the assessing authority has passed an order of assessment wherein neither there is any addition or disallowance of any claim is made and as such, on the basis of the same records, issuance of notice under Section 148 of the Act tantamounts to be on the basis of the change of opinion which is impermissible and since the said issue is now well settled, we may not overburden the present order by incorporating the case law on the subject. On the contrary, we also found from the contents of the objection that all details are consisting to computation of income, profit and loss figures and also tax audit report which are forming part of the assessment records, still in the absence of any tangible material, the respondent authority is trying to take a different view despite the original scrutiny of assessment is done. Under the circumstance, the action sought to be initiated is impermissible and we are of the considered opinion that a case is made out by the petitioner to call for interference. Petition allowed.
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2023 (4) TMI 1304 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL PRINCIPAL BENCH NEW DELHI
Direction to transfer Igatpuri Unit to the nominee of the Resolution Applicant M/s Kitply Industries Ltd within 45 (forty five) days - It is specific case of the appellant that the respondent failed to honour agreement and as such number of communications were made to the respondent/corporate debtor either to make payment or the appellant will take back possession of the property in question.
HELD THAT:- Admittedly the property of Igatpuri Unit is in relation to agreement to sale which was entered in between the appellant and Corporate Debtor long back in the year 1998. In terms of the agreement after payment of certain amount within a specified time, possession of land property of Igatpuri Unit was to be handed over to the Corporate Debtor i.e. Kitply Inds Ltd. It was clarified in the agreement as to how rest of amount was to be paid; in which manner and within what time.
It is specific case of the appellant that the respondent failed to honour agreement and as such number of communications were made to the respondent/corporate debtor either to make payment or the appellant will take back possession of the property in question. The record reflects that several opportunities were given for payment of the consideration amount failing which the appellant had communicated that it will terminate the agreement and take back possession of the property in question. However, it continued for several years. Even OTS was also offered. The appellant claims that as per OTS the entire consideration amount was not paid whereas the respondent has taken a plea that though there were two OTS i.e. dated 19.02.2008 and 20.02.2008, the respondent settled the dispute by making payment of Rs. 2 crore and by issuance of NCD of Rs.31 lakhs.
Once it is noticed that title holder of the property in dispute is the appellant, in such situation even after initiation of CIRP neither IRP or RP was competent to control the said property in view of rider as incorporated in Section 18(f) Explanation (a).
Admittedly till date the CD is not title holder of the property in question and dispute comes around the execution of the sale deed. It is admitted that dispute regarding either payment of remaining consideration amount as per sale agreement or non-execution of sale deed arose much before initiation of CIRP in the present proceeding and as such neither RP nor NCLT was having any jurisdiction to deal with such property - If there was still dispute in between parties it was not permissible for the NCLT to direct the appellant for transferring the property of Igatpuri in favour of CD or its nominee. Though it is not necessary to reiterate but it is established that unless in terms of agreement to sale, sale deed is finally executed after accepting full consideration amount, title always lies with the vendor.
The dispute whether agreement to sale which was entered in between the parties in the year 1998 was breached by the appellant or the respondent breached the agreement, may not be examined in a proceeding under the IBC. Such disputes are required to be examined by the court of competent jurisdiction. In view of admitted position that title of the property in respect of Igatpuri Unit still lies with the appellant, the Learned NCLT has committed error in allowing the application filed on behalf of the Respondent in directing for transferring the land in question and as such there is no option but to set aside the impugned order.
Impugned order set aside - appeal allowed.
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