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2021 (11) TMI 1094 - ITAT PUNE
Disallowance u/s.14A r.w.r. 8D - Necessity of recording satisfaction - HELD THAT:- Since the facts and circumstances on this issue for the year under consideration are similar to those of earlier years [2019 (12) TMI 627 - ITAT PUNE], respectfully following the precedent and specifically noting that the AO did record satisfaction in the assessment order, as further elaborated by the ld. CIT(A) in the impugned order, we hold that due satisfaction was recorded. Insofar as the calculation of disallowance at 0.5% under Rule 8D(2)(iii) is concerned, it is seen that the assessee itself computed such amount during the course of assessment proceedings and placed the same before the AO. To sum up, the ground raised by the assessee is dismissed.
Nature of receipt - capital or revenue receipt - taxability of receipt by the assessee under Package Scheme of Incentives (PSI) 2001 as revenue receipt chargeable to tax - HELD THAT:- The Hon’ble Bombay High court in Pr. CIT Vs. M/s. Welspun Steel Ltd. [2019 (3) TMI 397 - BOMBAY HIGH COURT] has taken similar view in deciding question no. (b) raised before it and held that the Tribunal was justified in holding that subsidy cannot be considered as a payment directly or indirectly to meet any portion of the actual cost. The assessee in that case also got subsidy for industrial development. Similar view has also been taken in M/s. Alkoplus Producers Pvt. Ltd. and Another [2019 (4) TMI 558 - ITAT PUNE] - It is overt that subsidy, in the prevailing circumstances, does not qualify for reduction from the cost of assets in pursuance of Explanation 10 to section 43(1) of the Act. We, therefore, overturn the alternative view also as canvassed in the impugned order on this score. This ground is allowed.
Allowability of Aircraft expenses - CIT(A) upheld the disallowance at 25% of the gross amount of expenses - HELD THAT:- While sustaining the disallowance, the ld. CIT(A) took gross figures of aircraft expenses. The assessee has placed on record a calculation showing that out of total expenses of Rs.560.06 lakh the assessee recovered a sum of Rs.344.80 lakh from outside parties etc., leading the net amount of expenses at Rs.215.26 lakh. The disallowance is, therefore, directed to be restricted to 15% of the net expenses after verification of the calculation shown by the assessee - Decided partly in favour of assessee.
Disallowance of Provision made for warranty - CIT(A) allowed part relief by restricting the disallowance - HELD THAT:- similar issue arose for consideration before the Tribunal in the earlier years. A copy of the Tribunal order for the assessment year 2011-12 2019 (12) TMI 627 - ITAT PUNE] has been placed on record, which shows that the assessee’s claim has been accepted in entirety for the amount of provision created by it. Respectfully following the precedent, we allow the assessee’s ground and dismiss that of the Revenue.
Disallowance of weighted deduction claimed u/s.35(2AB) - assessee claimed the weighted deduction - Department of Scientific and Industrial Research (DSIR), New Delhi approving authority, reduced the amount of eligible deduction - HELD THAT:- Amount of weighted deduction should be allowed in entirety irrespective of the fact that it was not approved by the DSIR, subject to verification of the claim by the AO in terms of the afore referred judgment of SUN PHARMACEUTICAL INDUSTRIES LTD. [2017 (8) TMI 933 - GUJARAT HIGH COURT].
Depreciation at 60% on Printers, UPS and other allied items - HELD THAT:- It is seen that similar issue came up for consideration before the Tribunal for the assessment year 2011-12 [2019 (12) TMI 627 - ITAT PUNE]. Relevant discussion has been made at page 54 of the paper book in which the opinion of the ld. CIT(A), in increasing the rate of depreciation, has been upheld. Respectfully following the same, we dismiss this ground.
Addition u/s.40A(2) on account of commission paid to Directors - AO treated the payment to Directors as excessive to this extent as per the mandate of section 40A(2), which was deleted in the first appeal - HELD THAT:- As seen that similar issue came up for consideration before the Tribunal in the assessee’s own case for the assessment year 2011-12. Respectfully following the precedent, we uphold the impugned order on this score.
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2021 (11) TMI 1093 - CALCUTTA HIGH COURT
Faceless assessment - validity of Order u/s 144 r.w.s. 254 and 144B - allegation of violation of principles of natural justice by way of not affording effective opportunity of hearing to the petitioner and not allowing him to file relevant documents in spite of repeated requests - HELD THAT:- Inability on the part of the petitioner to file relevant documents due to technical glitches in the portal system of the Income Tax Department over which he has got no control and to establish these facts of facing of technical glitches petitioner has annexed series of documents annexed to the writ petition from time to time and correspondences made to the department bringing it to the notice of the department of its grievance.
Respondent is not in a position to contradict these allegations which are matters of records and part of the writ petition as annexures.
Considering the submissions of the parties no purpose will be served by keeping the writ petition pending and interest of justice will be served if the impugned assessment order dated 26th September, 2021 is set aside with the direction upon the respondent assessing officer to pass a fresh assessment order after affording effective opportunity of hearing to the petitioner and by observing principles of natural justice preferably within two months from date.
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2021 (11) TMI 1092 - MADHYA PRADESH HIGH COURT
Maintainability of petition - availability of alternative remedy of appeal - petitioner has been deprived of proper hearing by the respondent - violation of principles of natural justice - HELD THAT:- The impugned order reveals that the District Magistrate has also made it a ground that the petitioner has not filed the orders of acquittal passed in his favour and has relied upon the cases enumerated by the S.P. in his recommendation and has come to a conclusion that since so many cases have been registered against the petitioner, which shows his involvement in the criminal cases even now. This Court also finds that before passing the impugned order, the District Magistrate has not recorded the statement of any person from the area, who could say that he is afraid to go to police station only on account of the terror or influence exercised by the petitioner.
It is apparent that by not providing the petitioner sufficient time to produce the orders of acquittal in the cases in which he was already acquitted, the principles of natural justice have been clearly violated and in such peculiar circumstances, even if the petitioner has not availed the remedy of appeal, this Court is of the considered opinion that this petition under Article 226 of the Constitution of India is maintainable. In the considered opinion of this court, had an opportunity to produce the copies of acquittal orders passed in favour of the petitioner been given to him by the District Magistrate, the result of the outcome could have been different.
Whether order of externment cannot be passed in respect of other adjoining district? - HELD THAT:- This court is not required to dwell upon the same as the impugned order is liable to be quashed on the ground of violation of principles of natural justice.
Petition allowed.
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2021 (11) TMI 1091 - PUNJAB AND HARYANA HIGH COURT
Seeking grant of Regular Bail - grant of bail opposed to the petitioner on the ground that he and his co-accused have forged judgments and decrees of a Court and that too for at least 187 persons - HELD THAT:- In a magisterial trial, the petitioner is in custody since 07.04.2021; investigation qua the petitioner is complete and therefore, neither is the petitioner needed for the same nor can he influence it; the main allegation with regard to forging of judgments and decrees is against co-accused Jaidev Singla and Nitesh (since dead); there is no other criminal case pending against the petitioner; no further recovery is also required to be made from him; co-accused Govind, who had approached this Court through CRM-M-31235-2021 – Govind vs. State of Haryana [2021 (9) TMI 1421 - PUNJAB AND HARYANA HIGH COURT] has been granted regular bail by this Court and that the petitioner's trial in which 13 witnesses have been cited by the prosecution is yet to begin and therefore it is likely to take a long time to conclude.
The present case is considered to be a fit one in which the petitioner be directed to be released on regular bail - Application allowed.
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2021 (11) TMI 1090 - ITAT DELHI
TP Adjustment - comparable selection - Functional dissimilarity - HELD THAT:- LARSEN & TOUBRO INFOTECH LTD. (L&T) - In view of the facts inter alia that L&T is into various segments having no segmental financials, having huge brand value and intangibles is not a suitable comparable vis-à-vis taxpayer which was working as a captive entity and that contention raised by the DR that under TNMM minor dissimilarities do not affect the overall comparability is not sustainable because though it is a taxpayer’s own comparable but there being no estoppel against statute and that taxpayer can rectify its mistake at any stage of the proceedings.
Secondly, it is not a case of minor dissimilarities rather it is a case of functional dissimilarity and non-availability of segmental financials to provide the clear picture qua profit earned by the company from provisions of SDS. L&T is a big brand having ownership of huge intangibles which ought to provide competitive advantage to the taxpayer in the form of premium pricing and huge volume of business ultimately leading to the higher profitability. So, we are of the considered view that L&T is not a suitable comparable vis-à-vis the taxpayer, hence ordered to be excluded.
Tata Elexi - We are of the considered view that on account of functional dissimilarity and having ownership of internally generated intangibles in the form of technical know-how for rendering services to its customers make Tata Elexi not a suitable comparable vis-à-vis the taxpayer who is a routine software development service provider working on cost plus markup model having no intangibles of its own, hence we direct to exclude Tata Elexi from the final set of comparables.
Cybercom Datamatics leads to the conclusion that it is into diversified services and is also a product company providing software development to its associated enterprises and also selling developed software product whereas the taxpayer is a routine software development services provider working on a cost plus mark-up model and as such its margin cannot be compared with Cybercom Datamatics, hence Cybercom Datamatics is ordered to be deleted as a comparable.
Cigniti has been excluded in a number of cases by the coordinate Bench of the Tribunal vis-à-vis the routine software development service provider on account of functional dissimilarity as it provides specialized services in the field of software testing, hence we find Cigniti not a suitable comparable vis-à-vis the taxpayer. Accordingly, it is ordered to be excluded.
Kelton is not a suitable comparable vis-à-vis the taxpayer being into diversified nature of services having no financial segmental to arrive at the proper margin, also being into development of various products and mobile apps and having own intangibles and softwares giving it edge over other players in the field as against the taxpayer who is a routine software development services provider working on cost plus mark-up, hence ordered to be excluded.
Thirdware is functionally dissimilar vis-à-vis the taxpayer as it has been deriving income from sale of licence and software services export from SEZ unit and revenue from subscription and training etc. and it is also into sale of licence and its segmental financials are not available.
Infobeansis providing wide range of services under four verticals i.e. services, automation, enterprise and industries and under the automation services verticals, the company is providing advanced robotic process automation services. Since Infobeans is into diversified activities it cannot be a suitable comparable vis-à-vis the taxpayer which is a routine software development services provider.
Inteq is not a suitable comparable vis-à-vis the taxpayer which is a routine software development service provider working on cost-plus mark up model, hence ordered to be excluded from the final set of comparables.
Adjustment on account of outstanding receivables - Delay in receipt of the receivables qua transactions undertaken with unrelated parties - TPO recharacterized the delay in receipt of receivables as unsecured loans advanced to the AE and attributed a notional interest @ 4.485% being Libor + 400 BPS on the period of delay exceeding 30 days - HELD THAT:- Since the taxpayer has not incurred any interest cost nor has availed of any loan from AE or unrelated third parties, as is evident from audited financials at pages57 & 66 of the paper book, proposed adjustment on account of delay in receipt of receivables by the TPO/DRP is not sustainable, hence ordered to be deleted. Consequently, grounds determined in favour of the taxpayer.
Non granting credit of Tax Deducted at source (TDS) in respect of amalgamating companies - HELD THAT:- When TDS has been deducted AO has no option but to grant the credit thereof to the taxpayer. So, we direct the AO to give credit of TDS deducted in respect of amalgamating companies, namely, IP Unity Communications Ltd. and GL Software Ltd. after due verification. Consequently, ground determined in favour of the taxpayer in accordance with law.
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2021 (11) TMI 1089 - CALCUTTA HIGH COURT
Violation of the principles of natural justice - allegation of non-consideration of another judgment of the Co-ordinate Bench of the Tribunal - reliance placed on circular being no. 45/2001-customs dated August 7, 2001 which has already been withdrawn from financial year 2002-03 - HELD THAT:- Keeping this writ petition pending will be futile exercise and interest of Justice will be served if the impugned order of the Tribunal dated February 25, 2020 is set aside only on this limited issue of the aforesaid circular dated August 7, 2001 which has been withdrawn.
The impugned order dated 25th February, 2020, is set aside with the direction upon the learned Tribunal to consider afresh on the issue of application of the aforesaid circular dated August 7, 2001 in the case of the petitioner and learned Tribunal shall also consider the judgments upon which the petitioner wants to rely in the matter at the time of hearing on remand - Petition disposed off.
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2021 (11) TMI 1088 - ITAT PUNE
Depreciation claimed on the asset " Right to Collect Toll" - commercial right or intangible asset - true nature of the rights acquired in terms of the contract awarded by the NHAI - Whether the asset on which depreciation has been claimed, does not form part of intangible asset defined u/s 32(1)(ii) - whether or not the cost of “Right to Collect Toll” qualifies as intangible asset as defined under clause (ii) of sub-section (1) of section 32? - HELD THAT:- There can be no doubt that as result of developing this project, the respondent-assessee had acquired a commercial right to collect the toll in terms of the contract awarded by NHAI. This right definitely falls within the meaning of “commercial right” or “intangible asset”. This definitely would qualify for depreciation @ 25%.
To the same effect is the decisions of the Hon’ble Rajasthan High Court in the case of GVK Jaipur Expressway Ltd.[2017 (10) TMI 1380 - RAJASTHAN HIGH COURT] the High Court has taken into consideration all the decisions and more particularly the decisions of (i) Hon’ble Delhi High Court in the case of Moradabad Toll Road Co. Ltd.[2014 (11) TMI 354 - DELHI HIGH COURT] (ii) Hon’ble Allahabad High Court in the case of CIT v. Noida Toll Bridge Co. Ltd.[2012 (11) TMI 556 - ALLAHABAD HIGH COURT]; (iii) Hon’ble Madras High Court in the case of CIT v. VGP Housing (P.) Ltd.[2014 (8) TMI 423 - MADRAS HIGH COURT]; (iv) Hon’ble Rajasthan High Court in the case of CIT v. Jawahar Kala Kendra [2014 (6) TMI 292 - RAJASTHAN HIGH COURT] (v) Hon’ble Rajasthan High Court in the case of CIT v. Mohd. Bux Shokat Ali [2001 (2) TMI 26 - RAJASTHAN HIGH COURT] (vi) decisions of the Hon’ble Jurisdictional High Court in the case of North Karnataka Expressway Ltd. [2014 (11) TMI 351 - BOMBAY HIGH COURT]; (vii) CIT vs. West Gujarat Expressway Ltd. (No.1) [2016 (4) TMI 1184 - BOMBAY HIGH COURT] and (viii) CIT vs. West Gujarat Expressway Ltd [.2016 (4) TMI 1220 - BOMBAY HIGH COURT] have no application to the facts of the present case, inasmuch as, the decision in the said two cases relates to the allowability of depreciation on roads treating as building. In the circumstances, we do not find any illegality in the order of the ld. CIT(A). Accordingly, we do not find any merit in the appeal filed by the Revenue. Hence, the grounds of appeal raised by the Revenue are dismissed.
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2021 (11) TMI 1087 - ITAT MUMBAI
Rectification of mistake u/s 154 - amounts with respect to interest income, commitment fees and agency income - HELD THAT:- We deem it fit and proper to rectify the quantum of interest income, commitment fees and agency fees. Ordered, accordingly. The impugned order dated 4th December 2020 stands rectified accordingly.
Ground nos. 9 and 10 remained indisposed off - DR fairly agrees that the above grounds have remained to be disposed of, but, as for the arguments as merits his suggestion is that these submissions can only be taken up for hearing when recalled matter comes up for hearing when recalled matter comes up for hearing. Learned counsel for the assessee does not oppose the said suggestion.
Having regard to the rival submissions, and having perused the material on record, we are satisfied that ground nos. 9 and 10 have remained to be disposed of and the impugned order needs to be recalled accordingly. We order so. The Registry is directed to refix the matter for the limited purposes of disposing of these two grounds of appeal.
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2021 (11) TMI 1086 - CESTAT CHANDIGARH
Recovery of CENVAT Credit along with interest and proposing equivalent penalty - Cenvat credit availed on input services on the strength of documents issued by their head office namely Dabur India Ltd. (Corporate Office), Ghaziabad, were registered with the Department as distributor of credit - Revenue observed that these documents did not have the requisite information such as name, address and registration number of the service provider, serial number and date of invoice/bills/challans etc. as required under Rule 4A of the Service Tax Rules, 1994 - HELD THAT:- The verification has been done. Name and address, PAN based registration of the suppliers along with verification report dated 10-10-2011 have been provided by the appellant. In fact, the verification was required to be done with the registration number provided by the appellant in 2019 to find out whether these suppliers were having the registration number as mentioned in the invoices provided by the appellant or not? If the registration number provided earlier is matched with PAN based registration provided by the appellant at present, then, the appellant is entitled for Cenvat credit - Therefore, the matter is remanded back to the adjudicating authority to verify as directed by this Tribunal hereinabove and thereafter to pass an appropriate order in accordance with law.
The appeal is disposed of by way of remand.
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2021 (11) TMI 1085 - KERALA HIGH COURT
Violation of the statutory stipulations contained in Section 15(A) of Essential Commodities Act, 1995 - petitioners contends that as per Section 15(A) of Essential Commodities Act, no court can take cognizance against a public servant for the offences punishable under the Act except with the previous sanction of the State Government - HELD THAT:- The contents of the order should reflect the materials considered by the authority for the purpose of deciding the necessity for granting sanction for prosecution of the public servant. Without highlighting any reason and without any indication as to the documents perused, no order of sanction should be passed. In this case, the order granting sanction was without any such observations and materials.
From both the documents produced by the learned Government Pleader, it is evident that it was decided not to proceed against the petitioners herein. As the prosecution against the petitioners herein are permissible only on the basis of sanction, the decision now taken by the respondents; not to proceed against them is having some relevance. In the light of the communications produced by the learned Government Pleader, it is evident that the Government is not intending to proceed against the petitioners herein. In such circumstances, further proceedings against the petitioners herein is an abuse of process of law. The chances of successful prosecution as against the petitioners herein are very bleak in the light of the above aspects. In such circumstances, it is only just and proper that the proceedings against the petitioners herein are to be quashed by invoking powers of this Court under Section 482 Cr.P.C.
Application allowed.
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2021 (11) TMI 1084 - NATIONAL COMPANY LAW TRIBUNAL CHANDIGARH BENCH
Application seeking urgent hearing - service of notice - HELD THAT:- In case, the service of speed post on the respondent is not made, the applicant shall adopt the mode of substitute service and the notice of hearing be advertised in two daily newspapers (one English and one Hindi) having wide circulation in the area and file affidavit of service along with copy of postal receipt, tracking report, copy of email and paper clippings, if applicable within two weeks - Reply, if any, be filed within two weeks after receipt of notice with a copy in advance to the counsel opposite. Rejoinder thereto, if any, may be filed one week thereafter, with a copy in advance to the counsel opposite.
List on 13.12.2021.
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2021 (11) TMI 1083 - CALCUTTA HIGH COURT
Lifting of provisional attachment - seeking permission to respondents/writ petitioners to operate the bank account and postal accounts by declaring the order of provisional attachment as having lost its efficacy as the confirmation order was not passed within a period of 180 days in terms of Section 5(3) of the Act - HELD THAT:- The writ petition is of year 2021 and the same has been allowed. We also find that no adequate opportunity was granted to the appellant to file affidavit-in-opposition. If the writ petition needs to be allowed at the admission stage and/or soon thereafter the court should record the finding that the affidavit-in-opposition is not required to be filed or if the contesting respondents give away its right to file affidavit-in-opposition.
The writ petition could not have been allowed with the finding and observations contained therein which may affect other litigants as well. That apart we find the learned writ Court after making such observations holding the appellant as a ‘non-litigant’ has granted a direction in the penultimate paragraph of the impugned order with an observation that the order passed in the writ petition will not prevent the Adjudicating Authority from passing final order of adjudication in the pending proceeding in accordance with law which, according to the appellants, had already been concluded and final orders passed. The respondents/writ petitioners have not preferred an appeal against the said finding - the present appeal filed by the department against order passed in the writ petition filed by the writ petitioners/respondents questioning the correctness and efficacy of the order of provisional attachment. As of now, the order of provisional attachment is no longer in existence because a final adjudication order has been passed on 9.11.2021. Thus, as on date the prayer sought for in the writ petition would have to be held to be infructuous. Be that as it may, the respondents/writ petitioners seek liberty to question the order passed by the Adjudicating Authority dated 9.11.2021 on all grounds, both factual and legal, including the contention that it has been passed in violation of the principles of natural justice.
A prima facie observation that an order of attachment would mean that status quo needs to be maintained and it could not mean that the person who has attached a property can appropriate the property before a final order was passed. This principle needs to be borne in mind and appropriate orders be passed by the appellant - appeal allowed.
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2021 (11) TMI 1082 - NATIONAL COMPANY LAW TRIBUNAL CUTTACK BENCH
Seeking stay on removal of Dr. Kedarnath Panda, the Petitioner No. 1 from the Directorship of the Company - seeking stay on discontinuation of service and stay on restriction to enter hospital premises till disposal of the Company Petition - HELD THAT:- The matter has been taken on board today on being mentioned by Ld. Counsel for the petitioner stating certain urgency. Hearing was conducted through Video Conference but due to unexpected connectivity issues it could not be concluded.
Due to connectivity issues and disturbances in audio, matter could not be heard in totality. List this main CP and all other connected lAs for final hearing on 02.12.2021.
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2021 (11) TMI 1081 - ITAT KOLKATA
Disallowance u/s 14A r.w.r 8D - assessee earned exempt dividend income and offer suo-moto disallowance while computing the income - CIT(A) deleted the additional disallowance by observing that AO was duty bound to record his dissatisfaction about the computation of disallowance made by the assessee - HELD THAT:- We find that besides the observation of Ld. CIT(A) in the impugned order, the disallowance is not sustainable for two reasons. Firstly, the suo-moto disallowance as offered by the assessee was more than the exempt income. Secondly, as per settled legal position, only those investments were to be considered which had actually yielded any exempt income during the year. The suo-moto disallowance offered by the assessee was in accordance with law. Therefore, finding no reason to interfere in the impugned order on this issue, we dismiss the ground raised by the revenue.
Disallowance u/s 43B (Employer’s contribution to Gratuity Fund) - Disallowance u/s. 43B(b) as per the observation of Tax Auditor that there was non-payment of Employer’s contribution to approved Gratuity Fund - CIT(A) deleted the same by observing that the same was already disallowed by the assessee in the computation of income and further disallowance would amount to double addition - we direct Ld. AO to verify the observation and delete the disallowance. This ground stand allowed for statistical purpose.
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2021 (11) TMI 1080 - ITAT MUMBAI
Penalty u/s 271(1)(c) - Estimation of income on bogus purchases - HELD THAT:- Hon'ble Delhi High Court in the case of CIT v. Aero Traders Pvt. Ltd. [2010 (1) TMI 32 - DELHI HIGH COURT] affirmed the order of the Tribunal in holding that estimated rate of profit applied on the turnover of the assessee does not amount to concealment or furnishing inaccurate particulars. Also see SHRI DEEPAK POPATLAL GALA & OTHERS [2015 (6) TMI 944 - ITAT MUMBAI]
In the case on hand the Ld. Assessing Officer and Ld.CIT(A) as well has only estimated the Gross Profit on the alleged non-genuine purchases without there being any conclusive proof of concealment of income or furnishing inaccurate particulars of such income. Thus, respectfully following the above decisions, we direct the assessing officer to delete the penalty levied u/s.271(1)(c) of the Act for the Assessment Year under consideration. - Decided in favour of assessee.
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2021 (11) TMI 1079 - SC ORDER
Maintainability of appeal - jurisdiction u/s 130-E of the Customs Act - HELD THAT:- On going through the statement of case filed on behalf of the appellant, it is not found that the issues raised come within the four corners of Section 130-E of the Customs Act, 1962.
There are no reason to entertain the appeals in the jurisdiction under Section 130-E of the Customs Act, 1962 - appeal dismissed.
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2021 (11) TMI 1078 - SUPREME COURT
Choice of representation in domestic inquiry - right to be represented by a representative of own choice - Misconduct by sanctioning advances in violation of the Head Office instructions causing financial loss to the bank - HELD THAT:- The respondent was aware that his request to be represented by a representative of his own choice had been rejected. Even then he took time and decided not to file an appeal before the Board of Directors against the order of the inquiry officer rejecting his request. He allowed the inquiry proceedings to continue and then filed an application for production of documents. When asked about relevancy, his stance was he had his own reasons on how the documents were relevant. In spite of ample opportunity, the respondent did not adduce evidence or examine witnesses, and abruptly stood up and walked out. Observations and findings in the disciplinary proceedings on the aspect of irregularities regarding exceeding his authority in the grant of advances, acceptance of discovery bills and the issue of bank guarantees etc. are clear and remain uncontroverted. The respondent’s defence in the form of alibi that he had followed the oral instructions of the then Chairman and the Director, which is of questionable merit, is to be rejected as unproven.
The officer can also be permitted to be defended by a representative, who must be a representative of a registered union/association of ‘bank’ employees, which, as held above, means an union/association of the employees of the Bank of Cochin and not association of employees of any or other banks. Notably, the provision does not stipulate that the employee requires permission from any authority or the inquiry officer for representation by a representative of a registered union or association of the Bank of Cochin. Such permission is required if an employee wants a lawyer to represent him/her in the disciplinary proceedings. In this case, contrary to the observations in the impugned judgment by the Division Bench, the respondent had never prayed or sought permission to be represented by a lawyer. This is despite the respondent being aware of the professional status of the inquiry officer and the presenting officer.
The questions of prejudice, change of position, creation of third-party rights or interests on the part of the party seeking relief are important and relevant aspects as delay may obscure facts, encourage dubious claims, and may prevent fair and just adjudication. Often, relevant and material evidence go missing or are not traceable causing prejudice to the opposite party. It is, therefore, necessary for the court to consciously examine whether a party has chosen to sit over the matter and has woken up to gain any advantage and benefit.
The relief as granted certainly has serious financial repercussions and would also prevent the appellants from taking further action, which aspect has been noticed, though not finally determined in the impugned judgment. The studied silence of the respondent, who did not correspond or make any representation for nine years, was with an ulterior motive as he wanted to take benefit of the slipup though he had suffered dismissal. The courts can always refuse to grant relief to a litigant if it considers that grant of relief sought is likely to cause substantial hardship or substantial prejudice to the opposite side or would be detrimental to good administration.
By the order dated 04.12.2009, the dues payable to the respondent in terms of the impugned judgment were released to him on furnishing security to the satisfaction of the Chief General Manager. During the course of hearing, it was stated that the amount released has been kept in a fixed deposit. The payment released is directed to be returned and restituted to the appellant bank without interest within a period of six weeks from the date of pronouncement of this judgment. However, in case payment is not made within the aforesaid period, the respondent would be liable to pay interest @ 8% per annum from the date of this judgment till actual payment is made. In addition, the appellants would be entitled to enforce the security furnished by the respondent.
Petition dismissed.
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2021 (11) TMI 1077 - ITAT DEHRADUN
Taxation u/s 44BB - receipts out of the contracts executed to various drilling offshore contractees along with ONGC - nature of the activities and scope of work of the contract - AO held that the contracts receipts are to be treated as Fee for Technical Services (FTS) in respect of equipment rental hire and claim of Section 44BB was denied and taxed the amount u/s 44DA - distinction between PSC and non-PSC partners for deciding whether a receipt would be assessed u/s 44BB or as FTS or Royalty - HELD THAT:- Such a distinction has to be rejected as an artificial construct devoid of merit. Secondly, it also cannot be accepted that similar kinds of services can be taxed u/s 44BB of the Act if rendered to a PSC and thereafter, sought to be taxed as FTS or royalty if rendered to a non-PSC partner. The plethora of case laws cited by the ld. ARs and especially the case of CGG Veritas [2012 (4) TMI 280 - ITAT DELHI makes it clear that once a PE is known or admitted to exist then the income as in this case, has to be assessed u/s 44BB of the Act more so because the equipment supplied and services rendered are for the purposes of extraction or production of mineral oils. Thirdly, treating of supply of skilled personnel to operate equipment supplied by the assessee cannot be viewed in isolation since the activity of supplying such manpower is part and parcel of the supply of equipment to be used for extraction or production of mineral oils. For this reason also, the income has to be assessed u/s 44BB of the Act only.
We also find that preferring appeal by the Revenue against the decision of the Hon’ble High Court in the case of M/s BJ Services Co. (ME) Ltd.[2007 (10) TMI 219 - UTTARAKHAND HIGH COURT] cannot be a ground for confirming the appeal. Till the decision is reversed, the order of the Hon’ble High Court stands legally binding.
Profits Attributable on revenues – 5.08% or 2% - While arriving at 5.08%, the ld. CIT(A) has rejected KOA Tools Limited as a comparable company on account that it incurred losses - HELD THAT:- The assessee relied on the ruling of the Special Bench of Chandigarh ITAT in the case of DCIT vs. M/s Quark Systems Private Limited [2009 (10) TMI 591 - ITAT, CHANDIGARH] wherein it was held that merely because a comparable is making loss, it cannot be excluded from the list of comparables, Imercius is a case in which not only functional area is different.
The above principle has also been upheld by other benches of ITAT in the case of UCB India (P) Limited [2009 (2) TMI 237 - ITAT BOMBAY-L], Wockhardt Limited [2010 (7) TMI 643 - ITAT, MUMBAI] , Brigade Global Services Private Limited [2014 (12) TMI 337 - ITAT HYDERABAD].
Thus we hold that Koa Tools India Limited which clears the FAR test should not be rejected as a comparable for the AY 2009-10.
Service Tax Reimbursement - AO treated service tax collected by the assessee as a part of its gross receipts - HELD THAT:- The issue under consideration has been recently adjudicated by the Uttarakhand High Court (Full Bench) in assessee’s own case and Others [2019 (4) TMI 1177 - UTTARAKHAND HIGH COURT] wherein the Uttarakhand High Court on similar facts has held that amount reimbursed to the assessee by ONGC representing service tax paid earlier by assessee to the Government of India and not “on account of provision of services in connection with exploration and production of mineral oil”, would not form part of aggregate taxable amount as referred under section 44BB.
Given the above reasons, the Division Bench held that reimbursement of service tax collected by the assessee should not be included while computing taxable gross receipts under section 44BB of the Act. Also see MITCHELL DRILLING INTERNATIONAL PVT. LTD. [2015 (10) TMI 259 - DELHI HIGH COURT] Hence, keeping in view, the pronouncements of the Hon’ble Court, we hold that the service tax cannot be made a part of the Gross turnover.
Revenue appeal dismissed.
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2021 (11) TMI 1076 - ITAT BANGALORE
TP Adjustment - contention of the assessee that the TPO conducted transfer pricing analysis on erroneous understanding of the business model of the assessee - HELD THAT:- This issue was there in the appeal for the assessment year 2014-2015, wherein the Tribunal in [2020 (2) TMI 1642 - ITAT BANGALORE] after examining the facts of the case, had accepted the contention of the assessee that the TPO conducted transfer pricing analysis on erroneous understanding of the business model of the assessee. Accordingly, the entire transfer pricing issue was set aside to the TPO with a direction that the transfer pricing analysis may be carried out having regard to the business model of the assessee
Since the facts for the assessment year 2015-2016 is identical to the facts considered by the Tribunal for assessment year 2014-2015, we restore the entire transfer pricing analysis for de novo consideration to the AO / TPO. It is ordered accordingly.
Interest on outstanding receivables - TPO computed the delayed trade receivables under the weighted average method. TPO by adopting the net interest rate of 4.38%, on average net receivables that is outstanding for the period exceeding 60 days, computed the interest adjustment on outstanding receivables - HELD THAT:- DRP has directed the TPO to re-work the interest computation based on the delay of individual invoices. However, the DRP has not complied with the directions of DRP. TPO was wrong in stating that the assessee did not furnish the invoice wise details of trade receivables. These details are furnished by the assessee vide its letter dated 24.10.2018 and are placed on record Volume-II. The assessee had given detailed submissions on the issue and the same has not been considered by the TPO. TPO is directed to re-work the interest computation based on the delay of individual invoice as per the directions of the DRP. It is ordered accordingly. In the result, grounds are allowed for statistical purposes.
Disallowance u/s 14A - HELD THAT:- It is settled position of law that if the assessee is not in receipt of any exempt income in the relevant assessment year, no disallowance u/s 14A can be resorted to. In this context, we rely on the judgment in the case of CIT v. Chettinad Logistics Pvt. Ltd. [2018 (7) TMI 567 - SC ORDER]. In light of the above judicial pronouncements, we hold that since the assessee was not in receipt of any exempt income during the relevant assessment year, the A.O. has erred in making disallowance u/s 14A .
Non-deduction of TDS on software expenses - AO disallowed software expenses u/s 40(a)(ia) by treating the same as “royalty”, hence liable for TDS - HELD THAT:- In view of the latest judgment in the case of Engineering Analysis Centre of Excellence Private Limited v.CIT & Anr. [2021 (3) TMI 138 - SUPREME COURT] we restore the issue to the files of the A.O. The A.O. is directed the examine whether expenses incurred for purchase of software is “royalty” and liable for deduction - A.O. is directed to follow the dictum laid down by the Hon’ble Apex Court in the case of Engineering Analysis Centre of Excellence Private Limited v.CIT & Anr. (supra).
Deduction u/s 10AA is to be allowed as assessed income - HELD THAT:- The Hon’ble jurisdictional High Court in the case of M Pact Technology Services Pvt. Ltd. [2018 (8) TMI 202 - KARNATAKA HIGH COURT] had held that deduction u/s 10AA of the I.T.Act should be computed on the assessed income and not on the returned income - we direct the A.O. to grant deduction u/s 10AA of the I.T.Act on the assessed income and not on the returned income. It is ordered accordingly.
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2021 (11) TMI 1075 - NATIONAL COMPANY LAW TRIBUNAL CHENNAI
Filing of memo furnishing the breakup of the expenses incurred at the Project site for the months between June and October 2021 which are pending to be paid from the Applicant’s frozen bank accounts - HELD THAT:- On hearing the Applicant and the particulars furnished by way of memo, the payments to the employees, suppliers are to be made in the manner indicated.
Application disposed off.
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