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2022 (5) TMI 1628 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, PRINCIPAL BENCH, NEW DELHI
Maintainability of application - It is submitted that there was no necessity to file Application which was only filed to delay the proceeding - HELD THAT:- The order of rejection passed by the Adjudicating Authority on the Application need no interference in this Appeal.
It is made clear that any observations made by the Adjudicating Authority while rejecting the Application have no bearing when the issues are decided by the Adjudicating Authority in accordance with law and merits. All contentions of both the parties are left open.
Appeal dismissed.
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2022 (5) TMI 1627 - ITAT BANGALORE
Validity of assessment u/s 153A - whether no seized material so as to frame the assessment u/s 153A found? - HELD THAT:- There was no dispute regarding the search action us/ 132 of the Act at the premises of the assessee and also seizure of various documents at their premises and recording of statement u/s 132(4) of the Act from Internal auditor and financial manager of assessee company.
There was also recording of statement u/s 132(4) from Executive Director of assessee company on the basis of this, notice u/s 153A of the Act was issued to the assessee on 23.11.2012. Now the contention of the Ld. A.R. is that there is no seized material so as to frame the assessment u/s 153A of the Act. In our opinion, this argument of Ld. A.R. is devoid of merits. As seen from the case records there were seized materials found during the course of search and also the statement recorded u/s 132(4) of the Act from Internal auditor and also from Executive Director of the company. Executive Director offered additional undisclosed income at Rs. 9.96 crores for financial year 2008-09 to 2010-11 and another Rs. 3.6 crores for the financial year 2011-12 in his statement recorded u/s 132(4) of the Act.
In another occasion, he offered additional income of Rs. 10.50 crores for the assessment year 2009-10 & Rs. 4.50 crores for the AY 2010-11 in answer to Q.Nos.22 & 24. Since there are seized materials and consequent to the panchanama so drawn where they admitted the various transactions with Vinayak Fruit Mandi, Venkateshwara Fruit Mandi and Venkateswara Bottle Traders. Being so, assessee’s case is covered against the assessee by the judgement of Hon’ble Karnataka High Court in the case of PCIT Vs. Delhi International Airport [2021 (11) TMI 928 - KARNATAKA HIGH COURT]
Thus we confirm the issue of notice u/s 153A of the Act and framing of assessment u/s 153A r.w.s. 143(3) - Ground No. 2 of additional ground is dismissed.
AO has not given opportunity of cross examination of certain person whose statement has been recorded on oath during the course of search - With regard to seized documents found in the premises of the assessee pertaining to Vinayaka Fruit Mandi, Venkateshwara Bottle Traders and Srinivasa Bottle Traders, these were confronted to Shri V. Janardhan, Internal Auditor & Finance Manager of SPR Group Holdings P. Ltd., who has admitted that there was no purchase of goods and services from FY 2007-08 onwards. This is the basis for the addition made by the AO. The statement of Shri V. Janardhan who has admitted that there were bogus purchases, his statement was confronted to the Director of the assessee company viz. Suresh Gowda. The statement of Suresh Gowda was also recorded by searched team.
For statement recorded from the third parties argument of the assessee’s counsel is devoid of merit. The statement recorded from Janardhan V was rightly confronted to the assessee represented by Executive Director Suresh Gowda and he has given reply against various submissions made by Shri Janardhan V., in his statement recorded u/s 132(4) of the Act. Further, at the time of recording the statement, the authorities asked him whether he wants to say anything else. He said in his answer to question No. 24 that nothing more to add to the above answers and offered Rs. 15 crores additional income for these assessment years and at that point of time, he has not asked for any cross examination of Shri V. Janardhan or later also he has not asked for the same. Being so, there is no merit in this argument of the assessee and deserves to be rejected. This common additional ground No. 3, in all appeals of the assessee is rejected.
Bogus purchases - Addition is based on the seized material and statements recorded from Janardhan V. and Suresh Gowda. However, the Ld. CIT(A) has not examined how these transactions are treated in the hands of Vinayaka Fruit Mandi, Venkateswara Bottle Traders and Srinivasa Bottle Traders in these assessment years. In our opinion, these facts are very relevant to decide the issue in the assessee’s case as there should be similar treatment in the hands of seller also. If it is considered as genuine in the hands of these vendors on the same principle, these transactions should be considered as genuine in the hands of the present assessee also. With these observations, we remit this issue on merit to the file of Ld. CIT(A) to consider afresh and decide in accordance with law.
Income generated in the hands of the assessee on giving advance to T. Nanda Krishna who has bought the property and later it was sold to M/s. SPR Developers Pvt. Ltd - CIT(A) is required to examine all the documents relating to these transactions listed in earlier para and also examine various statements recorded during the course of search action and decide the issue afresh by considering the entire facts and circumstances of the case. Accordingly, this issue is remitted back to the file of CIT(A) for fresh consideration to decide the same within six months of receipt of this order as this is old matter relating to the AY 2007-08.
Appeal partly allowed for statistical purposes.
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2022 (5) TMI 1626 - DELHI HIGH COURT
Exemption u/s 11 - activity of the assessee of letting out gallery frequently for a price - Whether qualify as being called in the nature of charity - Whether merely because a small percentage of the income of the Assessee is from letting out of its premises and sale of paintings, the essential activity of the Assessee would not cease to be charitable for the purposes of Sections 11 and 12?
As decided in ALL INDIA FINE ARTS & CRAFTS SOCIETY, NEW DELHI [2020 (6) TMI 603 - ITAT DELHI] Proviso to Section 2(15) of the Act, which was inserted by Finance Act, 2008, was directed to prevent the unholy practice of pure trade, commerce and business entities from masking their activities and portraying them in the garb of an activity in the object of a general public utility but was not designed to hit at those institutions, which had the advancement of the objects of general public utility at their hearts and were charity institutions, thus direct the AO to allow the assessee the benefit of exemption u/s 11 & 12
HELD THAT:- Appellant fairly draws our attention to the order passed [2019 (8) TMI 1500 - DELHI HIGH COURT], whereby the Revenue’s appeal, arising from the order [2019 (2) TMI 905 - ITAT DELHI] in relation to the respondent-assessee for the assessment year 2009-10, was dismissed by this Court. The impugned order passed by the Tribunal relies on the earlier order [2019 (2) TMI 905 - ITAT DELHI] in relation to the assessment year 2009-10.
Since this Court has already held that no substantial question of law arises for the consideration of this Court, we do not find any merit in the present appeal as well as in the application for condonation of delay, and the same are dismissed.
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2022 (5) TMI 1625 - ITAT CHENNAI
Bogus LTCG - unexplained profit on sale of shares of shares - unexplained credit u/s. 68 - claim of exemption u/s. 10(38) rejected by holding the sale of shares as penny stocks - HELD THAT:- As noticed that in the case of penny stock, we are consistently taking a view, where the SEBI report and the report of the Investigation Wing of Kolkata & Delhi or any other report was not confronted to the assessee, the matter is being restored back to the file of the AO for confronting the material gathered and used against the assessee. Similar view in the cases of SMT. VANDANA JAIN, MR. RAJ KUMAR JAIN, RAJ KUMAR JAIN HUF, and SMT. MITHU KUMARI RANKA [2022 (4) TMI 893 - ITAT CHENNAI],
As in the present case before us, the material gathered during the course of investigation was never confronted to the assessee. Hence, taking a consistent view, as taken we remit the issue back to the file of the AO exactly on similar directions. Appeal filed by the assessee is allowed for statistical purposes.
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2022 (5) TMI 1624 - CUSTOMS AUTHORITY FOR ADVANCE RULINGS, MUMBAI
Classification of goods proposed to be imported - dehydrated dark - small seedless raisins (Vitis vinifera) - eligibility for sr. no. 32 of N/N. 50/2017-Cus., dated 30.06.2017 - HELD THAT:- Regarding the issue of eligibility for the concessional rate of duty under sr. no. 32 of notification no. 50/2017-Cus., dated 30.06.2017, it is found that the said entry covers dark seedless raisins. The impugned goods being dehydrated dark and seedless raisins are eligible for concessional rate of duty under sr. no. 32 of the said notification.
The applicant in the personal hearing mentioned that the product is colloquially known as Zante currants also and that fact may create confusion in the minds of the assessing officers. As per the applicant, the Zante currants are raisins only. In support of above, the applicant submitted a certificate dated 15.07.2021 issued by the Associate Professor, Director of Laboratory of Viticulture, Greece, certifying that the product "Black Corinthian Currants" (alternatively "Zante currants", "Corinth raisins currants", "dark seedless raisins", are raisins of the seedless cultivar black Corinth Vitis vinifera). The definition of raisins given in the Food Safety and Standards (FSSAI) Regulations, 2009 has been examined. Regulation 5.5.46- "Nuts and Raisins" describes raisins as the product obtained by drying sound, clean grapes of proper maturity belonging to Vitis vinifera L. The product may be washed, with or without seeds and stems and may be bleached with Sulphur Dioxide - if the goods to be imported satisfy the above-mentioned condition then they are classifiable under subheading 08062010 and will be eligible to avail benefit under Sr. No. 32 of notification no. 50/2017. In other words, on verification, if the product imported by the applicant is proved to be of vitis vinifera, either by way of certification from PQ or FSSAI or otherwise, then the appropriate classification will be subheading 08062010 and goods will be eligible for the said notification benefit.
Thus, the dehydrated dark and small seedless raisin (Vitis vinifera) merit classification under subheading 08062010 of the first schedule of the Customs Tariff Act, 1975 and are eligible for exemption benefit allowed under sr. no. 32 of notification no. 50/2017-Cus., dated 30.06.2017.
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2022 (5) TMI 1623 - ITAT AHMEDABAD
Addition of unaccounted stock/unaccounted income - Assessee has not submitted any supporting evidences regarding its practice of valuation of closing stock - survey proceedings u/s 133A carried out at the business premises of the assessee - HELD THAT:- There was clear finding by the CIT(A) that the assessee never filed any supporting evidences regarding its practice of valuation of closing stock and during the survey proceedings the assessee himself admitted that there was excess unaccounted stock. The assessee was very well aware that there was excess stock, despite this fact the assessee offered only Rs.66,88,110/- and has not included the difference of Rs.13,57,865/-- in the return of income filed by the assessee. Merely, offering the declared gold and silver ornaments in survey proceedings in subsequent A.Ys. cannot held that there was no excess stock/unaccounted stock available during the A.Y. 2015-16.
The documents shown at the time of hearing by the assessee has not given the bifurcation as to how much was the quantity sold on the particular period related to gold ornaments and silver ornaments which shows that the assessee was deliberately following unaccounted stock and when survey conducted the same was admitted by the assessee. There is finding of the Assessing Officer that the G.P. shown during the survey period is higher than the post-survey period and the AO also pointed out discrepancy in the submissions made by the assessee. Thus, AO has made proper addition and the CIT(A) has correctly confirmed the same. The CIT(A) has given detailed finding and there is no need to interfere with the finding of the CIT(A). Therefore, the appeal filed by the assessee is dismissed.
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2022 (5) TMI 1622 - SUPREME COURT
Smuggling - Gold - appellant – accused – Rekha Jain is found to be in possession of the gold jewellery, which was taken away from the complainant - It is submitted that therefore the High Court has committed a grave error in not quashing the criminal proceedings against the appellant – accused Rekha Jain for the offence under Section 420 of IPC. - HELD THAT:- It is required to be noted that the offence alleged against the appellant – accused – Rekha Jain is for the offence under Section 420 of IPC. She has been now chargedsheeted for the said offence. However, considering the allegations in FIR/complaint, it can be seen that the entire and all the allegations are against the accused Kamalesh Mulchand Jain. In the complaint/FIR, there are no allegations whatsoever to the effect that the accused Rekha Jain induced the complainant to part with the gold jewellery. Therefore, in the absence of any allegation of inducement by the accused Rekha Jain, she cannot be prosecuted for the offence under Section 420 of IPC. There must be a dishonest inducement by the accused.
The allegations of dishonest inducement and cheating are against her husband – accused – Kamalesh Mulchand Jain. Therefore, considering the allegations in the FIR/complaint as they are, and in the absence of any allegation of dishonest inducement by Rekha Jain, it cannot be said that she has committed any offence under Section 420 of IPC for which she is now chargesheeted. Therefore, the High Court has committed a grave error in not quashing the criminal proceedings against Rekha Jain for the offence under Section 420 of IPC. This is a fit case where the High Court could have exercised its powers under Section 482 of Cr.PC and to quash the criminal proceedings against Rekha Jain for the offence under Section 420 of IPC.
The criminal proceedings against the appellant – accused – Rekha Jain for the offence under Section 420 of IPC is hereby quashed. However, it is clarified that what is quashed is the criminal proceedings for the offence under Section 420 of IPC only and not for any other offence(s), if any, committed by the accused – Rekha Jain. The present appeal is limited to the offence under Section 420 of IPC only as at present she is chargesheeted only for the offence under Section 420 of IPC.
Appeal allowed.
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2022 (5) TMI 1621 - DELHI HIGH COURT
Oppositions to trademark applications had been rejected on the ground that they were filed beyond the four months’ limitation period, which was contrary to the extension of limitation orders passed by the Supreme Court from time to time during the pandemic - HELD THAT:- It is clarified that the filing of the opposition and the suspension of the registration certificate of the Respondent, shall not affect the merits of the dispute between the parties, both in the suit and the appeal mentioned above, as the opposition has been permitted to be filed on a technical ground (limitation) and not on merits. Thus, the said opposition proceedings shall proceed in accordance with law and such proceedings shall not affect the suit or any other disputes pending between the parties. Clarified accordingly.
List all these matters on 3rd August, 2022 for receiving of the status reports to be filed by the office of the CGPTDM.
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2022 (5) TMI 1620 - ITAT BANGALORE
TP Adjustment - Adoption of the Most Appropriate Method (MAM)in determining the ALP in respect of an international transaction of payment of royalty to its Associated Enterprise (AE) u/s.92 - TNMM v/s Profit Split Method (PSM) - HELD THAT:- The facts in AY 2016-17 [2021 (6) TMI 855 - ITAT MUMBAI] are identical and the reasoning given in AY 2013-14 [2020 (3) TMI 947 - ITAT BANGALORE] will equally apply to the AY 2016-17 also. Respectfully following the aforesaid decision, we set aside the question of determination of ALP to the TPO afresh applying TNMM as the most appropriate method as was done in Assessment Years 2013-14 and 2014-15 in the order referred to above. The other issues with regard to determination of ALP under the PSM is academic and does not require adjudication.
Rate of tax on dividend distributed to non-resident shareholders - whether DDT is a tax on the Company or the Shareholder since the distributable surplus stands reduced to the extent or DDT? - HELD THAT:- We find that the ITAT Mumbai Bench in the case of Dy Cit 11 (3)(1), Mumbai vs Total Oil India Pvt Ltd. [2021 (6) TMI 855 - ITAT MUMBAI] in Assessment year 2016-17 has for identical reasons given by the DRP, made a reference to Special Bench disagreeing with the view of the ITAT Delhi in the case of Gieseck. & Devrient [India] Pvt Ltd. [2020 (10) TMI 750 - ITAT DELHI] Since the issue has not attained finality, we are of the view that it would be just and appropriate to remand the issue to the TPO/AO for fresh consideration in accordance with law. The grounds are treated as partly allowed for statistical purpose.
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2022 (5) TMI 1619 - ITAT CUTTACK
Addition based on higher consumption of electricity and lower production - undisclosed amount of paddy milled by the assessee - assessee had failed to furnish quantitative details of paddy milled, rice produced, by-products for specific period asked by AO - CIT(A) deleted addition - HELD THAT:- Addition on the basis of suspicion and noticing the factum of higher consumption of electricity and lower production which could be a case of strong suspicion but it is also settled law that suspicion, however strong, cannot take the place of evidence against the assessee for making a sustainable addition.
From the relevant part of the CIT(A) order, we observe that CIT(A) has accepted the explanation of the assessee towards higher electricity consumption in the relevant assessment year which was frequent breakdown and longer load of electricity that has then to be used to restart the milling machinery, which consumes higher electricity.
CIT(A) also observed that the AO calculated the undisclosed amount of paddy milled by the assessee and enhanced his income accordingly without bringing any evidence on record to suggest a suppression of the stock of paddy by the assessee and the books of accounts have not been rejected by the AO u/s.145(3) of the Act, which implies an acceptance of the results therein by the AO.
AO merely relied on the figures of electricity consumption available in the internet without verifying the facts and circumstances of the case of the assessee and he rightly held that this is not a plausible approach of the AO. In view of foregoing discussions, we reach to a logical conclusion that the CIT (A) was right in deleting the addition made by the AO on the basis of on suspicion, conjectures and surmises without bringing any adverse material and positive evidence against the assessee on record to show that the assessee has claimed higher electricity consumption to avoid tax payment. Ground No.1 of the revenue is rejected.
Capital contribution by partners - failure to explain the source and nature of cash deposits immediately before transfer and they had not shown adequate in their ITRs for Capital contribution - CIT(A) deleted addition observing that the assessee firm had duly discharged the onus cast upon it by the AO to establish the identity of the partners and their creditworthiness alongwith copies of I.T.returns of three partners, copies of bank accounts from where cheques were issued to the assessee firm, ledger accounts of the partners - CIT(A) observed that If the AO harboured doubts about the credit entries in the bank accounts of the respective partners, then it was open to him to re-open the assessments of these partners and make addition in their hands after conducting inquiries - HELD THAT:- In this regard, we are in agreement with the conclusions arrived at by the ld CIT(A) and in our considered opinion, if the AO was not satisfied with the creditworthiness of the partners, then he was eligible to take action against the partners under the relevant provisions of the Act but no addition can be made in the hands of the assessee firm in view of preposition rendered in the case of Odedara Constructions (2014 (2) TMI 130 - GUJARAT HIGH COURT] and case of Jaiswal Motor Finance (1983 (2) TMI 47 - ALLAHABAD HIGH COURT]. Respectfully following the same, we are compelled to hold that the conclusions arrived at by the CIT(A) does not carry any ambiguity, perversity and inferiority. Thus, we uphold the same. Ground No.2 of the revenue is rejected.
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2022 (5) TMI 1618 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, PRINCIPAL BENCH, NEW DELHI
Seeking withdrawal of appeal - Application under Section 7 has been admitted - HELD THAT:- An Application has been filed by the parties bringing on record a Settlement dated 21.04.2022. The Settlement contemplates that both the parties shall withdraw respectfully the Appeal being Company Appeal as well as the Application under Section 7 filed by the Financial Creditor.
The application is allowed taking the Settlement on record and the Appellant is permitted to withdraw the Company Appeal to enable the parties to approach the Adjudicating Authority by filing an Application for withdrawal of Section 7 Application. With regard to expenses etc., it shall be open for the parties to request the Adjudicating Authority to pass appropriate order.
The Appeal is permitted to be withdrawn.
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2022 (5) TMI 1617 - SUPREME COURT
Seeking grant of interim bail - bail sought on the ground that the sister of the petitioner is suffering from cancer and the petitioner's mother in law is suffering from non-alcholic liver cirrhosis requiring the spouse of the petitioner to travel from Kanpur to Delhi leaving no one in the family to attend to the needs of the petitioner's sister - HELD THAT:- It is considered appropriate to direct that the petitioner shall be released on interim bail for a period of four weeks, subject to such terms and conditions as may be imposed by the trial court. The period of bail shall commence immediately upon the release of the petitioner and after the expiry of which the petitioner shall surrender forthwith.
The application for interim bail is disposed of.
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2022 (5) TMI 1616 - ITAT KOLKATA
Rectification of mistake - miscellaneous application filed by the assessee stating therein that some errors apparent on record have occurred while adjudicating the appeal of the assessee - application seeking admission of additional ground has escaped attention of the Tribunal and no order has been passed by the Tribunal in respect of the said application - HELD THAT:- The error apparent on record has occurred in the common order of the Tribunal dated 26.03.2021 on account of non-adjudication of the application of the assessee for admission of additional grounds. The order of the Tribunal is, therefore, recalled for the limited purpose for adjudication upon the application of the assessee for admission of additional grounds and if the application is accepted by the Tribunal then for adjudication of the aforesaid additional grounds.
No adjudication upon Grounds pertaining to the levy of interest u/s 234B and 234D - As the aforesaid grounds have not been adjudicated by the Tribunal in the common order dated 26.03.2021. This being an error apparent on record, order of the Tribunal is hereby recalled on this limited issue also for the purpose of adjudication of Ground No.6 & 7 of the grounds of appeal of the assessee.
Non-consideration of certain facts in the common order - Tribunal in para 7.4 inter alia has observed that no other transaction of purchase of AE is benchmarked with the prices in ICIS-LOR website; that however the applicant’s purchase of Paraxylene from AE’s was benchmarked using ICIS LOR - HELD THAT:- We find from the order of the Tribunal that the point raised by the assessee was not the sole point to arrive at the final conclusion. The Tribunal has considered the overall facts and circumstances of the case.
It cannot be said that any error apparent on record has occurred in the aforesaid order of the Tribunal. The applicant has raised this context in just by disputing one observation made by the Tribunal whereas the order passed by the Tribunal is based on overall facts and circumstances of the case.
As decided in the case of Ramesh Electric And Trading Co. [1992 (11) TMI 32 - BOMBAY HIGH COURT] while relying upon the decision of 'T. S. Balaram, ITO V. Volkart Brothers' [1971 (8) TMI 3 - SUPREME COURT] categorically held that the power of rectification under section 254(2) of the Income-tax Act can be exercised only when the mistake which is sought to be rectified is an obvious and patent; mistake which is apparent from the record, and not a mistake which requires to be established by arguments and a long drawn process of reasoning on points on which there may conceivably be two opinions.
Failure by the Tribunal to consider an argument advanced by either party for arriving at a conclusion is not an error apparent on the record, although it may be an error of judgment and under such circumstances the Tribunal has no jurisdiction under section 254(2) to pass the second order. In view of our above observations and the legal position as stated above, we do not find any merit on this issue.
Miscellaneous Application of the assessee is partly allowed.
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2022 (5) TMI 1615 - ITAT MUMBAI
Taxability of income in India or not - income of royalty arising out of the above trademark of ‘ brand Marriott’ taxability - Who may be regarded as agent u/s 163? - whether the provision of section 163 can be invoked or not considering assessee as an ‘agent’ of Non-resident? - HELD THAT:- As assessee has given a registration certificate dated 21st august, 2006 and covers above assessment years [2006-07 to 2009-10]. No doubt, as held by the Hon'ble Delhi High Court in the case of CUB Pty Limited vs. [2016 (7) TMI 1094 - DELHI HIGH COURT] that since the brand owner not located in India, the situs of the brand would also be outside India and naturally, the income arising there from would be chargeable to tax in the hands of the owner of the brand. In fact, Marriott International Inc. (assessee) in these appeals is not the owners of the brand as per certificate of ownership produce before us.
Therefore, it is chargeable to tax in the hands of the person who owns the brand. Nevertheless, it is not the contention of the assessee that no tax should have been deducted under section 195 of the Act on the payments made by, Juhu Beach Resorts Limited, V.M. Salgaonkar and Brothers Pvt. Ltd. and Chalet Hotels Limited and we are also conscious of the fact that sum is received by the assessee and provision of section 163 of the act also needs to be examined. However, there is a substantive provision for that.
We set aside all these four appeals back to the file of AO with a direction to consider the certificate of registration on trademark dated 21 August 2006, which was applied for on 24 November 2003. AO may re-consider that in whose hands the above income is chargeable to tax as royalty income.
AO may also consider that who received the above sum on behalf of the non- resident tax payers and whether the provision of section 163 of the Act can be invoked or not considering assessee as an ‘agent’ of Nonresident. AO may also consider that if the tax is required to be deducted u/s 195 , then whether the tax has been deducted by the payer or not and whether they can be held to be agent of the non-resident. AO before proceeding against any other assessee or this assessee may issue requisite notice. We set aside all the grounds of appeal back to the file of the learned Assessing Officer for deciding the taxability of royalty. Appeals filed by the assessee are allowed for statistical purposes.
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2022 (5) TMI 1614 - ALLAHABAD HIGH COURT
Validity of reopening of assessment - period of limitation - Date of issuance of notice - HELD THAT:- As the impugned notice through email was sent to the petitioner on 01.04.2021. Thus, it has been admitted by the respondents that the impugned notice under Section 148 of the Income Tax Act, 1961 was issued to the petitioner on 01.04.2021 i.e. after expiry of limitation on 31.03.2021.
Respondents admits that the controversy involved in the present writ petition is covered by the judgment of Daujee Abhushan Bhandar Pvt. Ltd. Vs. Union Of India And 2 Others (2022 (3) TMI 784 - ALLAHABAD HIGH COURT] and, therefore, this writ petition may also be disposed of in terms of the said judgment.
The impugned notice u/s 148 and the reassessment order passed are hereby quashed.
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2022 (5) TMI 1613 - DELHI HIGH COURT
Settlement applications under SEBI Act - Illegality and irregularities committed by Companies alleged - violations of certain norms and regulations issued by SEBI in relation to minimum public shareholding, disclosures of shareholding details, etc. identity of promoters, valuation, etc. - Petitioners are aggrieved by exit offers given by Respondent-Companies which is alleged to be contrary to the provisions of Securities Exchange Board of India Act, 1992, Rules and Regulations as well as exit circulars.
Applicants filed settlement applications with SEBI in respect of the afore-said SCNs which is as currently pending before the Settlement Division of SEBI - as argued SEBI (Settlement Proceedings) Regulations, 2018 prohibit filing of settlement applications in respect of matters pending that are pending trial before any court.
HELD THAT:- On the perusal of previous orders, no directions are found which restrain SEBI from considering/ adjudicating the settlement applications. It appears that the instant applications have been filed by way of abundant caution at the instance of HPAC.
The Court has considered the objection put forth by Appellant but finds no cogent reason to reject the application. The decision on the settlement applications is the prerogative of SEBI. It is for the SEBI to deliberate and decide the same, in accordance with applicable provisions of SEBI Act, Rules, Regulations, etc. Whether the applications are prohibited or not is not for this Court to determine. Accordingly, the applications are disposed of with a clarification that SEBI shall be free to deal/ adjudicate the settlement applications filed by the Applicants, on its own merits, in accordance with law.
The decision on the settlement applications shall not prejudice the Petitioners and all rights and contentions of the parties herein are left open.
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2022 (5) TMI 1612 - ITAT NEW DELHI
TP Adjustment - comparables selected by the assessee and erroneous margin computation in case of some other comparables - HELD THAT:- Killick Agencies & Marketing Ltd. company is more or less into earning commission income being an agent of certain overseas entities specialized in manufacturing and sale of dredgers, dredging equipments, rudder propellers etc. Whereas, assessee provides sales and support services including warranty and maintenance services. Therefore, due to significant differences in the functional profile of the assessee and the selected comparable, we hold that this company cannot be treated as comparable to the assessee. Accordingly, AO is directed to exclude this company from the list of comparables.
Febulka Advertising Pvt. Ltd be excluded due to insufficient information available in public domain regarding the financials of the company as audited annual report of the company is not available in public domain.
Info Edge India Ltd company is providing internet based services relating to recruitment, matrimony and education etc. Whereas, the assessee provides sales and post sales support services to the products sold by its AE. Considering the huge difference in the functional profile between this comparable and the assessee, it will fail the functionality test, hence, cannot be considered as a valid comparable.
Interactive Manpower Solution company provides offshore recruitment and staffing solutions. These activities of the company certainly cannot be compared to the sales and post sales services provided by the assessee. It is also observed that the company has reported huge increase in its profit margin. Therefore, without properly analyzing the factors leading to abnormal increase in profit margin, it would not be safe to include this company as a comparable. In any case of the matter, fact remains that the company is functionally dissimilar to the assessee. For this reason alone, it cannot be included as comparable.
Sasken Network Engineering Ltd., Himachal Futuristic Communications Ltd. and Cameo Corporate Services Ltd. - as argued TPO has incorrectly computed the margin of these comparables by disregarding the working given by the assessee - HELD THAT:- We direct the assessing officer to examine the working of margin computation of the comparables stated to have been furnished by the assessee and correctly compute the margin of these three comparables after providing due opportunity of being heard to the assessee.
TP adjustment made to the ALP of payment made to the AE towards availing of management services - HELD THAT:- When the issue ultimately came up for consideration before the Tribunal [2018 (8) TMI 126 - ITAT DELHI], the Tribunal restored the matter back to the assessing officer - we are of the considered view that this issue also needs fresh adjudication. We, accordingly, restore this issue to the file of the TPO. The TPO is directed to decide the issue afresh after considering the detailed submissions/documentary evidences furnished by the assessee. The assessee is directed to furnish the details of services utilised.
Disallowance of deduction claimed u/s 10AA - while the assessing officer has disallowed assessee's claim of deduction u/s 10AA on the reasoning that assessee failed to furnish the complete details called for, learned DRP upheld the disallowance by relying upon its decision in assessment year 2015-16 - HELD THAT:- Undisputedly, the fact whether the assessee had fulfilled the conditions of Section 10AA of the Act was never decided by the Tribunal, since, the appeal of the assessee was decided on a legal ground and the assessment order was quashed. Therefore, the allegation of the departmental authorities that the SEZ unit is nothing but an extension of the existing unit, by splitting up or even otherwise, requires to be examined. More so, when the Assessing Officer has alleged that assessee failed to furnish the complete details. The contention of learned counsel for the assessee that the fulfillment of conditions of section 10AA of the Act cannot be examined in this assessment year, as, assessee's claim was allowed in assessment year 2015-16, the initial year of claim, in our view, is unacceptable. This is so because, in assessment year 2015-16 the departmental authorities, no doubt, had rejected assessee's claim of deduction due to alleged non-fulfillment of conditions of section 10AA of the Act. The issue was never examined by the Tribunal on merits while deciding assessee's appeal for assessment year 2015-16. Therefore, it cannot be said that fulfillment of conditions of Section 10AA of the Act was examined in assessment year 2015-16.
Since, AO has alleged that the assessee has failed to furnish complete details/information to evaluate the fulfillment of conditions of eligibility of claim of section 10AA and since learned DRP has simply relied upon its own decision in assessment year 2015-16 without verifying the facts, we are inclined to restore the issue to the assessing officer for fresh adjudication after verifying the fact whether the assessee has fulfilled the conditions of section 10AA. This ground of appeal is allowed for statistical purposes.
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2022 (5) TMI 1611 - ALLAHABAD HIGH COURT
Non-conclusion of proceedings against the respondent No. 4 - non-conclusion resulting in certain hardships to the petitioner as he and other beneficiaries have been attached to a distant fair price shop - HELD THAT:- While no direction may be issued with respect to the current arrangement as that may fall in administrative domain, it is expected that proceedings arising from the suspension of fair price shop agreement of respondent No. 4 may be concluded as expeditiously as possible, strictly in accordance with law and preferably within a period of three months from the date of presentation of a certified copy of this order before the respondent No. 2, if those proceedings are still pending.
The present writ petition is disposed of.
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2022 (5) TMI 1610 - SUPREME COURT
Entitlement to the preliminary report - violation of the rights of the Appellant-Accused - allegation against the Appellant is that while he was serving as a Minister, he is alleged to have misused his powers to influence the tender process and ensured that tenders were awarded to his close aides - violation of principles of natural justice - HELD THAT:- Initiation of the FIR in the present case stems from the writ proceedings before the High Court, wherein the State has opted to re-examine the issue in contradiction of their own affidavit and the preliminary report submitted earlier before the High Court stating that commission of cognizable offence had not been made out. It is in this background it is held that the mandate of Section 207 of Code of Criminal Procedure cannot be read as a provision etched in stone to cause serious violation of the rights of the Appellant-Accused as well as to the principles of natural justice.
Viewed from a different angle, it must be emphasized that prosecution by the State ought to be carried out in a manner consistent with the right to fair trial, as enshrined Under Article 21 of the Constitution.
When the State has not pleaded any specific privilege which bars disclosure of material utilized in the earlier preliminary investigation, there is no good reason for the High Court to have permitted the report to have remained shrouded in a sealed cover.
Taking into consideration the peculiar facts of the instant case, particularly the fact that the High Court had ordered an enquiry and obtained a report without furnishing a copy thereof to the Appellant and unceremoniously closed the writ petition, High Court is directed to supply a copy of the report submitted by Ms. R. Ponni, Superintendent of Police along with the other documents to the Appellant herein.
The appeal is disposed of.
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2022 (5) TMI 1609 - SC ORDER
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial creditors - HELD THAT:- There are no reason to interfere in the order impugned - appeal dismissed.
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