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Case Laws
Showing 361 to 380 of 1456 Records
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2024 (1) TMI 1096
Condonation of delay in filing appeal - Applicability of limitation act - Power of Appellate authority to condone the delay - appeal rejected on the ground of delay upon holding that there is no scope under the provisions of WBGST Act, 2017 read with the corresponding Chapter and Section of the CGST Act, 2017 for condoning the delay in submitting the appeal beyond four months - HELD THAT:- This court is of the considered view that it was well within the power of the appellate authority to consider the prayer of the petitioner for condonation of delay. The impugned order passed by the appellate authority that there is no scope to condone the delay beyond four months suffers from infirmity.
This court has to consider whether the petitioner has made out sufficient cause for presenting the appeal beyond the statutory period of limitation - After going through the reasons for the delay as evident from the annexure to FORM GST APL-01, this court is of the considered view that the petitioner was prevented by sufficient cause for not preferring the appeal within the statutory period.
This court, therefore, holds that the appellate authority failed to exercise its jurisdiction in the case on hand - the delay in presenting the appeal before the appellate authority is condoned.
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2024 (1) TMI 1095
Scope of supply - supply of goods or services in terms of the Circular 11/11/2017 dated 20.10.2017 - printing activities undertaken by them are eligible for exemption under Serial No. 3,3A of the Notification No. 12/2017 Central Tax (Rate) dated 28.06.2017 as amended - HELD THAT:- The process of conducting examination includes pre-examination works, the examination itself and post-examination works and for that purpose, printing of comprehensive report progress card may be treated as services relating to conduct of examination. However, in the instant case, the supply is provided to Education Department, Government of Assam and not to an educational institution - the instant supply shall not be covered under the aforesaid entry for exemption.
Supply of notebooks - HELD THAT:- The applicant has been awarded a contract by Jharkhand Education Project Council for printing/supply of 80 pages notebooks (including cover) for the academic session 2023-24. The notebooks are meant for free distribution among the children under School Kit Scheme of State Government. The acceptance letter issued by JEPC speaks that the multicolour matter for printing on inner and front cover pages of the notebooks will be provided at the time of work order in soft copies. On due consideration of the nature of contract, in the instant supply, ‘predominant supply is that of goods and the supply of printing of the content [supplied by the recipient of supply] is ancillary to the principal supply of goods and therefore such supplies would constitute supply of goods falling under respective headings of Chapter 48 or 49 of the Customs Tariff.’
Whether the printing activities undertaken by the applicant are eligible for exemption under Serial No. 3/3A of the Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017, as amended? - HELD THAT:- The term ‘pure services’ has not been defined under the Act. However, a bare reading of the description of services as specified in serial number 3 above denotes that supply of services which does not involve any supply of goods can be regarded as pure services. The said entry serial, therefore, specifically excludes works contract services or other composite supplies involving supply of any goods - to qualify to be a supply under serial number 3A, a composite supply, subject to fulfilment of other conditions as specified in the said entry, would be such that the maximum value of involvement of goods is less than 25% of the total value of the said composite supply.
As the supplies of printed text books, notebooks, activity calendar and comprehensive progress report card involves supply of paper, ink, binding and packing materials etc., such supplies would not come under serial number 3 of the notification supra. Further, the applicant has not furnished any documents wherefrom the value of goods involved in the supply can be ascertained.
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2024 (1) TMI 1094
Input Tax Credit - sale and buyback transactions - goods purchased from outsourced vendors, when payment is settled through book adjustment against the debt created on outward supplies to these vendors - HELD THAT:- The second proviso to sub-section (2) of section 16 of GST Act restricts credit of input tax to the recipient unless he pays the consideration to the supplier for inward supplies received by him along with tax payable thereon within the stipulated time of one hundred and eighty days from the date of issue of invoice.
The term ‘consideration’ has been defined in clause (31) of section 2 of the GST Act in an inclusive manner that extends the scope and range for mode of payment. Further, as per the said definition, it is immaterial whether the payment is made by the recipient or by any other person. Further, when there is barter of goods or services, the same activity constitutes supply as well as a consideration. For example, when a barber cuts hair in exchange for a painting, hair cut is a supply of services by the barber. It is a consideration for the painting received. Similarly, supply of painting is supply by painter and the painting is the consideration for hair cut.
Thus, the settlement of mutual debts through book adjustment is a valid mode of payment under the GST Act. Recipient can pay the supplier by way of setting book debt since the provision of the Act has not put any restriction in this regard. Therefore, claiming credit of input tax cannot be denied on the sole ground that consideration is paid through book adjustment.
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2024 (1) TMI 1093
Scope of supply - Composite supply or not - Government of Delhi – removal of hump (silt/ earth/ manure/ sludge etc.) by dredging at Najafgarh Drain as awarded by the Irrigation and Flood Control Department - comes under the purview of Union Territory - Exemption from GST under Sl. No. 3 of Notification No. 9/2017 Integrated Tax (Rate) dated 28.06.2017- or Sl. No. 3A of Notification No. 12/2017- Central Tax (Rate) dated 28.06.2017 as amended from time to time? - rate of GST - HELD THAT:- The instant work falls within the ambit of matter listed at Sl. No. 6 of the Twelfth Schedule of 243 W of the Constitution of India, i.e. “Public health sanitation conservancy and solid waste management”.
The records submitted by the applicant also includes certificate dated 07.08.2023 under No. F.22(113)/2022-23/AB-CD-I/3889, issued by the Executive Engineer, Civil Division-I, Irrigation & Flood Control Department, Government of NCT of Delhi, New Delhi, wherein he has certified that “the works contract constitutes mainly of dredging and earthwork excavation which is pure service work and the cost of material transferred and consumed for execution and completion of the work contract is less than 5 (five) percent of the total work order value, if any required”. This clearly establishes that there is an element of goods also in the supply, although in a small percentage - the instant supply is found to be a composite supply of goods and services in which the value of supply of goods constitutes not more than 25 per cent of the value of the said composite supply.
Entry at Sl No. 3A of Notification No. 9/2017-Integrated Tax (Rate) dated 28.06.2017, as amended [Sl. No. 3A of Notification No. 12/2017-Central Tax (rate) dated 28.06.2017, as amended] describes that Composite supply of goods and services in which the value of supply of goods constitutes not more than 25 per cent of the value of the said composite supply provided to the Central Government, State Government or Union territory or local authority by way of any activity in relation to any function entrusted to a Panchayat under article 243G of the Constitution or in relation to any function entrusted to a Municipality under article 243W of the Constitution is exempted.
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2024 (1) TMI 1092
Scope of supply - Composite supply or not - Government of Delhi - services provided by the applicant for desilting and cleaning the Najafgarh Drain, awarded by the Irrigation and Flood Control Department - comes under the purview of Union Territory - Exemption from GST under Sl. No. 3 of Notification No. 9/2017 Integrated Tax (Rate) dated 28.06.2017- or Sl. No. 3A of Notification No. 12/2017- Central Tax (Rate) dated 28.06.2017 as amended from time to time? - rate of GST - HELD THAT:- The instant work falls within the ambit of matter listed at Sl. No. 6 of the Twelfth Schedule of 243 W of the Constitution of India, i.e. “Public health sanitation conservancy and solid waste management”.
The records submitted by the applicant also includes certificate dated 07.08.2023 under No. F.22(113)/2022-23/AB-CD-I/3889, issued by the Executive Engineer, Civil Division-I, Irrigation & Flood Control Department, Government of NCT of Delhi, New Delhi, wherein he has certified that “the works contract constitutes mainly of dredging and earthwork excavation which is pure service work and the cost of material transferred and consumed for execution and completion of the work contract is less than 5 (five) percent of the total work order value, if any required”. This clearly establishes that there is an element of goods also in the supply, although in a small percentage - the instant supply is found to be a composite supply of goods and services in which the value of supply of goods constitutes not more than 25 per cent of the value of the said composite supply.
Entry at Sl No. 3A of Notification No. 9/2017-Integrated Tax (Rate) dated 28.06.2017, as amended [Sl. No. 3A of Notification No. 12/2017-Central Tax (rate) dated 28.06.2017, as amended] describes that Composite supply of goods and services in which the value of supply of goods constitutes not more than 25 per cent of the value of the said composite supply provided to the Central Government, State Government or Union territory or local authority by way of any activity in relation to any function entrusted to a Panchayat under article 243G of the Constitution or in relation to any function entrusted to a Municipality under article 243W of the Constitution is exempted.
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2024 (1) TMI 1091
Exemption form GST - upfront premium payable by the applicant towards the services of leasing of the land for industrial purposes by SMPK - entry 41 of Notification No. 12/2017 Central Tax (Rate) dated 28.06.2017 - HELD THAT:- On due consideration of the reply given by SMPK and in light of the discussions detailed herein above including scope of audit of CAG, it cannot be concluded that SMPK may be regarded as an entity having 20 percent or more ownership of Central Government merely on the ground that its books of accounts are audited by CAG - it cannot be held that being registered as a deductor of tax at source under section 51 of the GST Act can be equated with the supplier of services specified in entry number 41 of Notification No. 12/2017- Central Tax (Rate) dated 28.06.2017 i.e., an entity having 20 percent or more ownership of Central Government.
The services of leasing of the land for industrial purposes by SMPK to the applicant is found not to be covered under entry 41 of Notification No. 12/2017 Central Tax (Rate) dated 28.06.2017 and therefore cannot be treated as an exempt supply.
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2024 (1) TMI 1090
Revocation of suspension of the Licence of the Customs Broker-respondent - inappropraie classification of imported goods - HELD THAT:- In the impugned order, the Commissioner has observed that it was not the case of the Department that the Customs Broker had given a different description than what was given in the import invoice. The above observation is of utmost relevance since the import invoice is issued by the vendor / foreign supplier to the importer. Further, the Commissioner has also accepted the pleading of the respondent-Customs Broker that the classification under CTH 8518 was made as per the directions of the importer, which fact stood duly supported by the Show Cause Notice issued by the DRI to the importer. The Commissioner has thus concluded that there was no violation of any of the Regulations, as alleged in the Show Cause Notice, by the respondent-Customs Broker and being satisfied, has proceeded to drop the proposed proceedings. Other than filing the present appeal, the Revenue has not been able to dislodge the above findings of the lower authority, nor has it even denied the said findings as incorrect.
The classification declared by the importer itself has been accepted and thus, there is no reason still to hold that there was wrong classification, any more. Hence, the charge against the respondent-Customs Broker for being hand in glove with the importer inviting such a hugely disproportionate action of suspension of its very Customs Broker Licence and forfeiture does not hold water.
There are no infirmity in the impugned order of the Commissioner of Customs (Imports) and hence, the appeal filed by the Revenue is dismissed.
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2024 (1) TMI 1089
Validity of remand order passed by the Commissioner (Appeals) - The appellate authority has accepted the prayer of the revenue to remand the matter back but failed to consider the cross objection filed by the appellant - declared value was accepted as the transaction value for the purposes of assessment of duty under Rule 3(3)(b) of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007
HELD THAT:- The contentions of the Ld. Additional Commissioner cannot be accepted since, as recorded by the Commissioner (Appeals) himself at pages 4 and 5 of the impugned order, the appeal was filed with a prayer to remand, that is to say, the same must have been requested / prayed for during the course of arguments and hence, the word “remand” finds place at two places in the impugned order. In any case, even the order of the Commissioner (Appeals) as to allowing the Department appeal and ‘prayer’, satisfy that what is passed by the Commissioner (Appeals) is a remand order, for which the appellant before the said authority had not made out any specific case as to violation of any of the conditions under Section 128A(3)(b) ibid.
The order of the Commissioner (Appeals) is clearly in violation of the statutory provisions, for which reason the impugned order becomes unsustainable in law. He should have, after making such enquiry as may be necessary, passed such order as he thinks just and proper by disposing of the dispute before him.
The ld. Commissioner (Appeals) may examine and dispose of the matter afresh on merits after hearing the appellant and allowing it to submit a written submission, if it so desires - The impugned order is set aside and the appeal is partially allowed.
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2024 (1) TMI 1088
Re-valuation of imported goods - re-determination/enhancement of value of both the “Infrared Thermometer” as well as “Fingertip Pulse Oximeter Blue Colour” in terms of Rule 5 of the Customs Valuation Rules, 2007 - rejection of declared value - HELD THAT:- The principles of natural justice have not been followed by the first appellate authority insofar as the Infrared Thermometers are concerned, instances of imports relied upon have not been furnished to the appellant, but the same have been used against the appellant. There is no denial by the Revenue on the above facts. Hence, it appears that at least insofar as valuation of the thermometer in question is concerned, the re-determination of the value is not proper.
The contemporaneous imports relied upon by the first appellate authority having not been put across for rebuttal, the impugned order suffers from serious legal infirmity, being violative of the principles of natural justice. The first appellate authority has undoubtedly proceeded beyond the scope of the appellate jurisdiction as prescribed under the statute and therefore, the impugned order to this extent cannot sustain.
Insofar as the enhancement of value of Fingertip Pulse Oximeter is concerned, no specific arguments were advanced - the appeal insofar as the enhancement of value of the oximeter is concerned, is dismissed.
The appeal is partly allowed and partly dismissed.
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2024 (1) TMI 1087
Valuation of imported goods - PTFE Thread Seal Tape - correctness of the declared value which were alleged to be not on par with the contemporaneous imports in other ports - HELD THAT:- Nothing is said about the commercial level and the quantity involved in those transactions to conclusively establish that the so-called contemporaneous imports were in fact of ‘similar goods’ within the meaning of Rule 2(f) ibid. Having alleged about the contemporaneous imports, the adjudicating authority could have at least brought on record or in the Order-in-Original the details of the alleged contemporaneous imports, mere mentioning of dates and Ass. Value is not a sufficient compliance with the requirements of the statute. So also, with regard to the so-called market survey done behind the back of the appellant, nothing apparently is placed on record and hence, both the so-called alleged contemporaneous imports and the market survey is to be ignored. Moreover, the requirements of the statute are that the imports should be of identical or similar goods and such imports should be at or about the same time as the import in question.
This Bench in the case of COMMISSIONER OF CUSTOMS VERSUS M/S. SREE RAJENDRA TEXTILES [2023 (8) TMI 265 - CESTAT CHENNAI] has considered in depth the issue of re-valuation of imported goods on the basis of contemporaneous imports and held the lower adjudicating and assessing authorities have to necessarily consider all the commercial factors to arrive at contemporaneous prices of identical or similar goods before resorting to enhancement of the declared transaction values in terms of Rule 4 or Rule 5 of Customs Valuation (Determination of Value of Imported Goods) Rules, 2007.
The ratio of the above order is clear, the re-valuation attempted by the Revenue has been set at naught for lack of merits by the Bench.
There are no justifiable reasons to sustain the impugned order - appeal allowed.
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2024 (1) TMI 1086
Jurisdiction - proper officer to issue SCN - power of Directorate of Revenue Intelligence (DRI) to issue SCN - HELD THAT:- As and by way of ad-interim relief, the impugned Order-in-Original dated 5th December 2023 passed by the respondent is stayed, with liberty to the respondents to make an application for vacating the said orders in the event, the respondents are of the opinion that the same ought not to be continued and / or after the decision of the Supreme Court in the pending Review/Writ Petition in the case of M/S CANON INDIA PRIVATE LIMITED VERSUS COMMISSIONER OF CUSTOMS [2021 (3) TMI 384 - SUPREME COURT].
Petition disposed off.
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2024 (1) TMI 1085
Delayed adjudication of the show cause notice - Jurisdiction to issue SCN - SCN issued by the Directorate of Revenue Intelligence - HELD THAT:- No different view can be taken from what has been taken in the case FARMICO COMMODITIES PRIVATE LIMITED (FORMERLY KNOWN AS WADHWANI COMMODITIES TRADING PVT. LTD.) VERSUS THE UNION OF INDIA THROUGH THE SECRETARY, DEPARTMENT OF REVENUE & ORS. [2023 (9) TMI 1413 - BOMBAY HIGH COURT], that is to admit the present petition.
This Court had directed adjudication of the show cause notice, keeping open the contentions of the petitioners to be urged on such issues before the adjudicating authority.
In so far as the interim reliefs are concerned, the impugned show cause notices dated 20 June 2007 and 24 May 2010 shall remained stayed. However, the respondents are at liberty to move this Court for vacating of the interim stay if the respondents are of the opinion, that such orders ought not to be continued and / or after the decision of the Supreme Court on the review proceedings filed in M/s Canon India Pvt. Ltd. and of the final adjudication on the challenge to the Finance Act 2022.
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2024 (1) TMI 1084
Appropriate petition not filed - no pleadings on the fact as to how the petitioners are aggrieved - HELD THAT:- If the individual petitioners are aggrieved, they need to file appropriate petitions - these petitions cannot be entertained.
Petition disposed off.
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2024 (1) TMI 1083
Validity of assessment proceedings - time limitation - HELD THAT:- Section 9(2) of the Central Sales Tax Act, 1956 makes the provisions of the relevant state sales tax law applicable to proceedings for assessment, reassessment, recovery and enforcement. Therefore, the provisions of the TNVAT Act become applicable. Section 27 of the TNVAT Act enables the Tax Department to undertake reassessment in respect of escaped assessment of tax provided such reassessment is undertaken within six years from the date of assessment. Sub-section (2) of Section 22 of the TNVAT Act provides for deemed assessment. The proviso thereto prescribes that assessment shall be deemed to have taken place on 30.06.2012 with regard to specific assessment years, including assessment years 2006-2007 and 2007-2008, with which we are concerned.
The question of limitation should be determined on the basis that the limitation period is six years from the date of assessment.
Assessment year 2006-2007 - HELD THAT:- The respondent relies on pre-assessment notice dated 19.11.2012. Although the pre-assessment notice bears an endorsement, on the basis of the said endorsement, it is not possible to ascertain as to who acknowledged receipt. The said endorsement does not contain the name of the person who purportedly acknowledged receipt or bear the rubber stamp of the petitioner. It should also be noticed that the reminder notice dated 12.07.2018, which appears to be the next notice for the relevant assessment year, was issued after the period of limitation expired in June 2018. On the basis of documents placed on record in these proceedings and in view of the petitioner's assertion that he did not receive notice dated 19.11.2012, it is concluded that proceedings relating to assessment year 2006-2007 have not been shown to be within the period of limitation prescribed by statute.
Proceedings relating to assessment year 2007-2008 - HELD THAT:- In the absence of any evidence that the assessee received assessment order dated 16.10.2012 and in the absence of proof of service of any notices within the limitation period of six years computed from 30.06.2012, the assessment order for assessment year 2007-2008 also warrants interference.
The writ petitions are allowed.
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2024 (1) TMI 1082
Input tax credit - denial in respect of the export transaction - power of suo motu revision against an order of the Assistant Sales Tax Officer or Sales Tax Officer - HELD THAT:- This issue has become academic. More so, when as against the assessment order the writ petitioner had filed an appeal and when the matter was fixed at the appellate stage, an authority who is junior than the appellate authority can obviously not exercise this power of suo motu revision. Above all a Senior Commissioner who is none other than the Commissioner of Sales Tax being a superior authority has sufficient jurisdiction to exercise the power of suo motu revision - the said ground raised by the writ petitioner does not appear consideration and accordingly stands rejected.
Input Tax Credit - denial on account of payment made to third party on behalf of the selling dealer - HELD THAT:- It is a well settled legal principle that Input Tax Credit is a form of concession provided by the legislator and it is available only if the conditions stipulated are fulfilled. Sub-rule(8) of rule 19 makes it clear that the payment has to be made to the selling dealer by means cheque or demand draft or by means of electronic mode. Therefore, the writ petitioner is precluded from adding words to a stature to state that he will be entitled to the benefit of Input Tax Credit though he is not paid the amount to the selling dealer but to a third party based on certain instructions. The concession can always comes with conditions and if the conditions are not fulfilled the concession is not available. Therefore, the conclusion arrived at by the tribunal in this regard deserves to be confirmed.
Thus, no grounds have been made out by the petitioner to interfere with the order passed by the learned tribunal - the writ petition fails and stands dismissed.
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2024 (1) TMI 1081
Condonation of delay in filing the returns of income seeking refund - delay due to date of ruling of the AAR - genuine hardship for purposes of Section 119(2)(b) - petitioner explained the delay up to 16.08.2016, which is the date of ruling of the AAR in the matter relating to the G.R.Engineering Private Limited project, by pointing out that its applications for advance ruling may have been rejected otherwise - whether it is desirable or expedient to condone the delay so as to avoid genuine hardship? -
Whether the petitioner had a reasonable basis for asserting that it was under the bona fide belief that it would lose the valuable right of receiving an advance ruling if the returns of income had been filed? - HELD THAT:- Upon examining the relevant provisions and the precedents cited in this regard, it is of the view that the petitioner's assertion that it believed bona fide that it could lose the valuable right of requesting for an advance ruling by filing the returns of income while the applications are pending before the AAR cannot be disregarded as lacking credibility.
As returns of income were filed on 04.03.2017, which is more than six months after the AAR ruling, another question arises, namely, whether the delay between 16.08.2016 and 04.03.2017 was adequately explained? - In the affidavit in support of the petition, the petitioner referred to the earlier rulings of the AAR in respect of previous projects of the petitioner to the effect that the income of the petitioner was not taxable in India and asserted that this led to the bona fide belief that returns need not be filed. The petitioner also averred that taxes were deducted and remitted in respect of income earned by the petitioner. The petitioner asserted that it did not file the returns of income on the due dates in these circumstances. If the petitioner had filed the returns of income prior to the due dates, it is likely that the applications for advance ruling would have been held to be not maintainable as per the proviso to Section 245R(2). Therefore, the filing of applications before the AAR after the due dates for filing returns of income does not lead to the conclusion that the petitioner has not made out a case of genuine hardship for purposes of Section 119(2)(b).
Thus the applications to condone delay in filing returns of income and seeking refund are liable to be condoned on terms since such applications fall within the scope of the expression 'genuine hardship' in Section 119(2)(b) - no opinion is expressed herein on the merits of the refund claims - orders impugned herein are quashed and the delay is condoned subject to payment of a sum of Rs. 50,000/- as costs.
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2024 (1) TMI 1080
Reopening of assessment u/s 147 - notice was issued beyond period of four years - reasons to believe - reliance on third report of Shah Commission by which it was observed that there were illegal export particularly by means of under invoicing on the part of mining lessees and the exporters - HELD THAT:- AO claimed that assessee failed to disclose fully and truly all the material at the time of filing the returns that income derived was from the illegal mining activities. First of all such observations are incorrect as though the leases were declared as illegal from 22.11.2007, there is absolutely no finding or observation of the Apex Court that mining activities or business activities continued after 23.11.2007 till the same were stopped as per orders of the Supreme Court, were also illegal. Decision concerning leases was delivered in the year 2014. Till that time neither the assessee nor the Assessing Officer had knowledge that such leases were illegal after 22.11.2007. When assessee was not knowing, there was no occasion for him to make disclosure to that effect.
In Mr. Teofilo Fernando Antonio Pinto Vs Union of India and anr. [2023 (9) TMI 625 - BOMBAY HIGH COURT] the Coordinate Bench of this Court while considering all the earlier decisions including decisions in case of Aroni Commercial Limited [2014 (2) TMI 659 - BOMBAY HIGH COURT] and CIT Vs Kelvinator India Limited 2010 (1) TMI 11 - Supreme Court] observed that twin conditions must be satisfied when the reopening is beyond the period of four years. Justification offered while rejecting objections of the petitioner cannot be regarded as valid defence of the impugned notice. Such justification/reason given for the first time at the time of disposal of the objections filed by the assessee objecting to reopen the assessment. Such reasons must exist and recorded at the time of issue of notice under Section 147/148 of the Act.
In the present matters, notices issued for reopening of the assessment failed to satisfy twin conditions and thus the Assessing Officer could not have exercised jurisdiction for reopening of the assessments which were concluded way back.
First of all placing reliance only on opinion in the third Shah Commission Report without independently assessing or recording reasons by the Assessing Officer is itself considered to be jurisdictional error on the part of such officer. Secondly when the notice was issued beyond period of four years, conditions regarding disclosure to be made fully and truly is also not established for the simple reason that the fact that such lease was illegal beyond 22.11.2007 was not to the knowledge of the assessee while submitting returns for the Year 2008-09 and also for the year 2011-12. The Apex Court in the year 2014 for the first time declared that the mining leases in Goa beyond 22.11.2007 were illegal. Thus prior to 2014 i.e. declaration by the Apex Court neither the assessee nor the Assessing Officer had knowledge that such leases were illegal, the question of making such declaration in the year 2008-09 or 2011-12 while submitting returns would not arise.
Thus notice for reopening failed to satisfy twin conditions and therefore, both these notices under Section 147 of the Act need to be quashed and set aside. Decided in favour of assessee.
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2024 (1) TMI 1079
The Motor Accident Claims Case (MCC) - Computation of income of the deceased for passing award - computation of future prospects - Tribunal while passing award had taken income of the deceased adding 15% towards future prospects - Tribunal had considered gross salary of the deceased @ Rs. 53,728/- and after making deduction for HRA treated gross salary @ Rs. 53,200/- per month or Rs. 6,38,400/- per annum
HELD THAT:- Tribunal computed Income Tax @ Rs. 40,180/- overlooking the facts that standard deduction and Professional Tax is to be deducted, so also amount exempted under Section 80(c) of the Income Tax Act are to be exempted. Thus, out of deduction is to be of Rs. 50,000/- towards standard deduction. Another sum of Rs. 72,000/- will be deducted under Section 80(c) of the Income Tax Act on account of monthly contribution of Rs. 6000/- per month towards GPF and thereafter Professional Tax of Rs. 2500/- is to be deducted. Thus, total taxable income comes out to Rs. 5,13,900/-.
Tribunal has note that first sum of Rs. 2,50,000/- is exempted from payment of Income Tax and thereafter, further sum of Rs. 2,50,000/- is taxable @ 5% i.e. Rs. 12,500/- and on the remaining amount Income Tax would be payable @ 20% therefore, total Income Tax liability comes out to Rs. 15,280/- 3% cess. making it Rs. 15,738.40/-.
Net income on which dependency is to be calculated after deduction of Income Tax comes out to Rs. 6,22,662/-. 15% is to be added towards future prospects which comes to Rs. 7,16,061.30/- from which 1/4th is to be deducted towards living expenses of the deceased as he survived by five legal heirs and then when multiplier of 09 (nine) is applied, then total pecuniary compensation comes out to Rs. 48,33,414/- against a sum of Rs. 46,24,119/-.
Thus, there will be enhancement to the tune of Rs. 2,09,295/- under the head of pecuniary compensation which will be admissible in favour of the claimants and not Rs. 4,83,174/- awarded by this Court.
Thus, there being a mistake of computation of future prospects twice, there will be reduction and actual enhancement will come out to only Rs. 2,09,295/- which will be admissible in favour of the claimants alongwith interest @ 6% from the date of filing of the claim petition.
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2024 (1) TMI 1078
Reopening of assessment u/s 147 - reason to believe - notice issued beyond the period of 4 years - assessee is a non-filer of return of income - HELD THAT:- Reasons recorded by the AO clearly established the assessee is a non-filer of return of income in spite of taxable income in his hand, which clearly falls under the provisions of Clause (a) of Explanation 2 of Section 147 of the Act. The AO has also brought on record the cash deposits as made by the assessee in his bank account. Therefore, we do not find any infirmity in the “reasons recorded” by the AO for reopening of assessment. Therefore, the reopening of assessment is hereby upheld.
Validity of sanction granted u/s 151 by the PCIT-2, Rajkot - As noted here that the reopening of assessment is beyond the period of 4 years, wherein the Sanctioning Authority u/s 151 is the PCIT. Therefore, the PCIT has recorded his approval in Sl. No.13 of the above format and not the JCIT. So, this argument of the assessee is against the provisions of the Act - Thus, the reopening of assessment is held to be good in law and Ground No.1 raised by the assessee is hereby rejected.
Addition on account of long term capital gain - As stated by the assessee that the above property was purchased by the assessee’s father on 17.01.1985 for a sale consideration of Rs. 11,200/- only and the assessee claim of Rs. 3,48,000/- as land development charges without even proper evidences which is not sustainable in law. The registered sale deeds also does not describe that the plots were being surrounded by compound walls as on the date of sale in 2010. In the absence of any such details, we do not find any infirmity in the computation made by the AO and the assessee also failed to produce proper evidence in support of the claim of expenses incurred by the assessee. Therefore, this ground no.2 raised by the assessee is hereby rejected.
Unexplained cash deposit - CIT(A) confirmed this addition solely on the ground that the sale agreement was entered by the assessee not in a stamp paper, but only in a white paper without even any witnesses and without mentioning the date of receipt of cash - HELD THAT:- As evidence from the registered sale deeds, the very same two plots were sold to two different parties for a consideration by the assessee and his family members on 23.08.2010. Thereafter, the sale consideration alongwith assessee’s mother past savings were deposited in assessee’s bank account on 31.08.2010 of Rs. 18,50,000/-. Thus, it cannot be said that the explanation offered by the assessee is not genuine, since, the very same two plots were sold to two different persons on 23.08.2010. Therefore, in our considered view, the addition made being unexplained income of the assessee is hereby liable to be deleted. Therefore, we direct the AO to delete the addition as unexplained cash deposit in the hands of the assessee.
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2024 (1) TMI 1077
Revision u/s 263 - taxability of interest on enhanced compensation - assessee argued that revision merely based on audit objection - whether AO has validly held that interest under section 28 of Land Acquisition Act, 1894 granted by the court is an integral part of enhanced compensation and exempt u/s 10(37) in case of the assessee? - HELD THAT:- Record reveals that the order of the Ld. PCIT was prompted solely by the audit objection. Hon’ble P & H High Court has held in CIT vs. Sohana Woollen Mills [2006 (9) TMI 157 - PUNJAB AND HARYANA HIGH COURT] that mere audit objection cannot lead to an inference that the order of the Ld. AO is erroneous or prejudicial to the interest of the Revenue.
Since the order of the Ld. AO is based on the decision of the Hon’ble Supreme Court in Ghanshyam HUF[2009 (7) TMI 12 - SUPREME COURT] on the issue of taxability of interest received by the assessee under section 28 of Land Acquisition Act, it can at best be said to be a debatable issue on which two views are possible and the Ld. AO accepts one of the views. In this view of the matter too, the Ld. PCIT cannot assume revisional jurisdiction as held in CIT vs. Hindustan Coca Cola Beverages P Ltd. [2011 (1) TMI 138 - DELHI HIGH COURT]
Thus we hold that the order of the Ld. PCIT is not sustainable - Decided in favour of assessee.
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