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2023 (2) TMI 1250 - ITAT MUMBAI
TDS u/s 194H - disallowance of discount given to prepaid distributors u/s. 40(a)(ia) of the Act for non-deduction of tds - HELD THAT:- We find that assessee in the course of its business appoints prepaid distributors (i.e. distributors). The assessee supplies prepaid sim cards and recharge vouchers to its distributors at a discounted price. The assessee supplies prepaid sim cards containing the talk time worth at a higher figure than the discounted price to the distributors. The distributors supply them to the retailers and retailers sell the same to the ultimate customer / user. The distributors make payment of the discounted price in advance to the assessee and there is no payment of any kind made by the assessee to its distributors. The distributors would sell to the retailers after adding its margin and the retailers would sell to the customer after adding his margin. The ultimate price to the customer / user is subjected to the Maximum Retail Price (MRP) fixed by the assessee. It is pertinent to note that the distributor does not earn any income just by obtaining the prepaid sim cards and recharge vouchers from the assessee.
From the perusal of the distributors agreement, we find that the distributor is allowed to distribute to its retailers at any price between the consideration paid to the assessee and the MRP fixed by the assessee. The distributor possesses complete freedom of pricing. Hence, the first tranche of the transaction is selling of prepaid sim cards and recharge vouchers containing the talk time for a higher value by the assessee to the distributors, on which the distributor does not earn any income at all. As stated supra, the distributors earn income only when the said sim cards and recharge vouchers were sold at a price higher than its purchase price (i.e. the price paid by the distributor to the assessee herein). Hence, it is highly impossible to determine the amount of income that would accrue to the distributor on which tax ought to have been deducted by the assessee u/s. 194H of the Act. Hence, the entire TDS computation mechanism fails in this case.
Thus we hold that the sale of prepaid sim cards / recharge vouchers by the assessee to distributors cannot be treated as commission / discount to attract the provisions of section 194H of the Act and hence there cannot be any obligation on the part of the assessee to deduct tax at source thereon and consequentially there cannot be any disallowance u/s 40(a)(ia) of the Act.
TDS u/s 194J - Disallowance of roaming charges paid / payable to other telecom operators u/s. 40(a)(ia) for nondeduction of tax at source - HELD THAT:- We find that the Chandigarh Tribunal in the case of DCIT vs. Idea Cellular Ltd [2018 (6) TMI 1646 - ITAT CHANDIGARH] held that it does not require any human intervention and charges received or paid on account of this is not fees for technical services as envisaged in section 194J read with section 9(1) (vii) read with Explanation-2 of the Act. We find that in the absence of any change in facts or law, the payments made for interconnection are not fees for rendering any technical services as envisaged in section 194J of the Act. Therefore, no tax is deductible at source u/s 194J of the Act on payment of roaming charges to the OTOS and the assessee therefore cannot be treated as an assessee in default. Decided in favour of assessee.
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2023 (2) TMI 1249 - SC ORDER
Validity or reassessment order u/s 148A(d) passed without considering the reply filed by the assessee - As decided by HC as the impugned order has been passed without considering the reply revenue has no objection if the impugned order u/s 148A(d) - HELD THAT:- Issue notice to the respondent.
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2023 (2) TMI 1248 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL PRINCIPAL BENCH, NEW DELHI
Principles of natural justice - Resolution Plan already approved during the pendency of this Application - Applicant/Appellant was not given opportunity to meet the Chairman-cum-Managing Director, who is the Competent Authority for considering the proposal of the Applicant/Appellant who is an MSME - HELD THAT:- It is open for the Applicant/Appellant to make such application, as permissible in law, before the Adjudicating Authority for consideration of this grievance, if any. Learned Counsel for the Applicant/Appellant submits that he is making offer higher than the Successful Resolution Applicant, whose plan has been approved. It is open for the Applicant to place his plea, as admissible in law, before the Adjudicating Authority.
Thus, no case has been made out to make further order in I.A. No. 259 of 2023. Any Application filed by the Applicant shall be considered in accordance with law by the Adjudicating Authority.
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2023 (2) TMI 1247 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI
Resolution Plan was filed by Resolution Professional for consideration before the Adjudicating Authority - Approval under Section 31(4) proviso of the I&B Code has not yet been obtained from Competition Commission of India - HELD THAT:- The Adjudicating Authority relying on three member bench judgment of this Appellate Tribunal in Arcelormittal India Pvt. Ltd. vs. Abhijit Guhathakurta, [2020 (1) TMI 277 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI] and another three member bench judgment in Makalu Trading Ltd. and Ors. vs. Rajiv Chakraborty and Ors., [2020 (9) TMI 386 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL , NEW DELHI] has taken the view that it is not mandatory to obtain the approval by the Competition Commission of India prior to approval by CoC and the same can be obtained during pendency of the application for approval pending before the Adjudicating Authority. The Adjudicating Authority rejected the Intervention Application filed by the Appellant holding that Appellant has no locus relying on its earlier order passed on 22.09.2022.
Learned counsel for the Respondent No.1 and 2 submits that the issue as to whether the approval under Section 31(4) proviso is necessary/mandatory or not has already been heard by the Adjudicating Authority in Intervention Application of other stakeholder and order has been reserved on 09.02.2023. Respondent No.4 also adopted the submissions of Respondent No.1.
There are no reason to enter into the issue as the said issue has already been reserved for consideration before the Adjudicating Authority.
Appeal disposed off.
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2023 (2) TMI 1246 - ANDHRA PRADESH HIGH COURT
Misappropriation of society funds by diverting them to their personal use - HELD THAT:- The defacto complainant herein filed an affidavit to that extent tendering his unconditional consent to quash the subject matter. Hence, at this stage, without going into the merits of the case and in view of the common judgment passed by this Court in Writ Appeal Nos.234, 142, 149, 204 & 253 of 2022 and taking into consideration of affidavit filed by the de facto complainant tendering his unconditional consent and no objection in quashing the proceedings in respect to the subject crime, this Court is of the view that continuation of proceedings would amount to abuse the process of law.
The Criminal Petition is allowed, quashing the proceedings in Crime No.346 of 2021 of Mangalagiri Rural Police Station, Guntur Urban, Guntur District, against the petitioner herein.
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2023 (2) TMI 1245 - SUPREME COURT
Classification/discrimination made by the Greater Noida Authority (G Noida) in payment of compensation on the basis of the landholder being 'Pushtaini' and 'Gair-Pushtaini - HELD THAT:- TThe establishment of Greater Noida, was done for a noble purpose, i.e., to accommodate in the city all those who came travelling from every corner of the country in search of a better life. While doing so however, as can be seen in the present case, some residents whose land was subject to acquisition in the pursuit of the said aim, were faced with discrimination. In such circumstance, it becomes the duty of this Court to dispense justice, and rectify the harm caused to those at the receiving end of the discrimination.
The impugned judgment passed by the Full Bench of the High Court is not liable to be sustained and stands set aside. As a consequence, the Writ Petition filed by the Appellants before the High Court stands allowed and the Appellants are held entitled to the reliefs claimed in the said Writ Petition.
Appeal allowed.
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2023 (2) TMI 1244 - BOMBAY HIGH COURT
De-listing letter of 10th November 2022 - Petitioner is de-listed for nine months from the list of approved vendors for the manufacture and supply of jointless hard Drawn Grooved Copper contact wires or HDGC wires - HELD THAT:- There is here a procedural irregularity in the absence of cogent reasons, the failure to take into account relevant material and the reliance on extraneous or immaterial factors, that meets the Wednesbury unreasonableness standard. As to proportionality, nowhere in the impugned order we find a justification for a de-listing for nine months.
It can only be presumed that it was less than 12 months because someone might have described that as a blacklisting, and hence completely illegal. But that still does not answer why it should be this particular period.
It is impossible to sustain the impugned order at Exhibit "A" - petition allowed.
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2023 (2) TMI 1243 - SECURITIES APPELLATE TRIBUNAL, MUMBAI
Fraudulent scheme for issuance of GDRs by the Company - SEBI found that Vintage was the sole subscriber to the GDR and that the Company did not disclose this fact with clarity that only one entity had subscribed to the entire GDR and, therefore, misled the investors and loan agreement and the pledge agreements were not disclosed to the stock exchange or to the shareholders of the Company - WTM restrained the Company, Chairman and its Managing Director from accessing the securities market for a period of three years and one year respectively and imposed a sum of Rs.10 crore upon the Company and Rs.10 lakh each upon the Chairman and Managing Director - whether directions imposed by the WTM and the penalty imposed by the AO was harsh and excessive?
HELD THAT:- Where the punitive measure is harsh or disproportionate to the offence which shocks the conscience it is within the discretion of the Court to exercise the doctrine of proportionality and reduce the quantum of punishment to ensure that some rationality is brought to make unequals equal.
In our opinion, the penalty imposed is excessive and disproportionate to the violation and is also discriminatory.
Excessive penalty imposed upon the Company does not make any sense. In the instant case, there are public shareholders and workers. The Company is a running concern. Penalising the Company with such heavy penalty is in fact penalising the shareholders which is not justifiable especially for a running company. Further, the money raised through GDRs has been received by the Company and has not been misappropriated. The same has been utilitised for the purpose for which the GDR was issued which fact has not been disputed. Thus, it is not a case of defalcation of the funds.
While affirming the order of the AO for the violations committed by the Company we reduce the penalty against the Company to Rs. 25 lakh. The penalty against the Chairman and Managing Director is affirmed.
For the same reason, debarring the Chairman and Managing Director for 1 year is neither excessive nor arbitrary. We accordingly confirm the directions issued by the WTM. Further, in the circumstances of the case, the debarment of the Company for a period of 3 years is reduced to the penalty undergone.
Appeal of Euram Bank is concerned, the WTM has issued a warning to the said appellant to ensure that all its future dealings in the Indian securities market is done strictly in accordance with law - Appellant Euram Bank was registered as a Foreign Institutional Investor (FII) with SEBI in the year 2008 and that an entity known as India Focus Cardinal Fund (IFCF) was registered with SEBI as a sub account of the appellant. The role played by Euram Bank while granting a fraudulent structured loan to Vintage was dubious. The pledge agreement executed by Euram Bank with the Company pledging the GDR shares prior to its actual issuance for the purpose of securing the loan given to Vintage was totally dubious.
WTM also found that IFCF undertook the role of off-loading the converted shares of GDR in the Indian market which was done with the active role of the appellant bank and the fraudulent scheme of the sub account IFCF could not have been completed and the shares of Zenith could not have been sold in the Indian market but for the active participation of the appellant bank. On these findings the WTM held that there was sufficient reasons to hold the acts of the appellant bank amounted to transgression of Section 12A of the SEBI Act read with Regulation 3 and 4 of the PFUTP Regulations. In spite of coming to the aforesaid conclusion the WTM has only issued a warning on the strength of the observation that the appellant subsequently took corrective steps in removing Arun Panchariya as Director from its joint venture Euram Bank Asia Ltd. (EBAL).
Considering the findings given by the WTM we are of the opinion that the warning given by the WTM to the appellant bank does not suffer from any manifest error.
Violations found against the Company and the Directors are affirmed. Appeal of the Company, Zenith Steel Pipes and Industries Limited are partly allowed. The debarment is reduced to the period undergone and penalty is reduced from Rs. 10 crore to Rs. 25 lakh.
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2023 (2) TMI 1242 - NATIONAL COMPANY LAW TRIBUNAL BENGALURU
Seeking approval of the Resolution Plan - eligibility of the Resolution Applicant as per Section 29A of Insolvency and Bankruptcy Code, 2016 - HELD THAT:- In compliance to the order dated 09.12.2022, the RP filed Memo vide diary no. 5625 dated 21.12.2022 stating that, in the present case there are no debts or liabilities due and payable to the Central Government, any State Government or any Authority. The resolution professional has not received any claim from any government department, institution or any statutory authority. It is stated that no claims have been made, even belatedly after nearly 2 years of the CIRP being initiated. No employees have filed any claims or claimed any unpaid Provident Fund/Gratuity payments by the Corporate Debtor. The Provident Fund Commissioner or the EPFO have not filed any claims before the resolution professional. Further, the resolution applicant in the Resolution Plan (at Page No. 98 of the application submitted for the approval of resolution plan-para D in the table under Clause II of the Resolution Plan), has proposed to make 100% payment towards the outstanding statutory dues, if any, anytime.
The MSME UDYAM Certificate obtained subsequent to the initiation of CIRP is required to be ignored and the Successful Resolution Applicants in the case are not eligible under Section 29A r. w. s. 240A of IBC. The Resolution Plan submitted in therefore not tenable in law and is rejected under section 31(2) r.w.s 30(2)(e) of IBC.
Application disposed of.
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2023 (2) TMI 1241 - CESTAT NEW DELHI
Levy of service tax - lease rental charges - Department alleged that leasing of vehicles is taxable service and appellant was liable to pay service tax on the same - HELD THAT:- The issue on levy of service tax on lease rental charges has been decided by the Principal Bench of this Tribunal in the appellant’s own case M/S. CARZONRENT (INDIA) PVT. LTD. VERSUS CST, DELHI [2017 (1) TMI 98 - CESTAT NEW DELHI] where it was held that the appellants failed to sustain legally their plea regarding non-applicability of the provisions of Service Tax to the transactions of renting of motor cabs and on such consideration received.
It is pertinent to note that the current show cause notice is a periodical one which has been adjudicated by the Commissioner vide the impugned order. There is no change in the factual matrix, and therefore there are no reason to deviate from the decision of this Tribunal in the Appellant’s own case.
As regards the request of the appellant for referring this matter before a Larger Bench in view of the contrary decision of the Mumbai bench of the Tribunal in the case of ARVAL INDIA PRIVATE LIMITED VERSUS PRINCIPAL COMMISSIONER OF SERVICE TAX – IV AND (VICE-VERSA) MR CJ MATHEW, MEMBER (TECHNICAL) [2020 (9) TMI 125 - CESTAT MUMBAI], it is noted that the Tribunal has differentiated the decisions based on the facts, as is evident in para 7 of the order.
There are no infirmity in the impugned order - appeal dismissed.
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2023 (2) TMI 1240 - DELHI HIGH COURT
Income taxable in India - FTS - whether the activities carried out by the respondent/assessee fall within the exclusionary part of Explanation 2 i.e., whether or not the activity was in the nature of mining or like project? - whether Section 44BB of the Act would be applicable to the assessee, who is a second line contractor - PE in India - According to AO since the payment received is qua FTS, it will fall under Section 9(1)(vii) of the Act and is also covered by the provisions of Article 13 of the India-France Double Taxation Avoidance Agreement (DTAA) - it is the respondent/assessee’s case that the activity in issue is connected with prospecting and extraction of mineral oil, and therefore, would fall under Section 44BB? - HELD THST:- There is no question of law proposed by the appellant/revenue, that this finding of fact is perverse. Therefore, in our view, we are not inclined to frame any question(s) of law, with regard to whether or not the income received by the respondent/assessee is in the nature of FTS.
Whether the amount received by the respondent/assessee, in relation to which, concededly, tax has been paid on a presumptive rate under Section 44BB? - It is the appellant/revenue’s case, that since the respondent/assessee, concededly, was a second line contractor, Section 44BB of the Act would not apply to it.
To be noted, there is no such distinction made in Section 44BB of the Act with regard to a main or a second line contractor. All that the recipient of income has to demonstrate, is that it is a non-resident who is engaged in the business of providing services or facilities in connection with or supplying plant and machinery on hire used, or to be used, in the prospecting for, or extraction or production of mineral oils.This is again, in our view, a finding of fact which cannot be disturbed, unless it is held to be perverse. Once again, no question of law has been proposed by the appellant/revenue, to the effect that the finding of fact is perverse.
Whether Section 44BB of the Act would be applicable to the respondent/assessee, who is a second line contractor? - Although, prima facie, as noted above, there is no such distinction made between a main or a second line contractor, because a somewhat similar question has been admitted in Technip UK Limited [2018 (7) TMI 2335 - DELHI HIGH COURT] we are inclined to issue notice.
We may note, that the question of law framed for consideration by a coordinate bench of this Court reads as follows :
“Whether the Income Tax Appellate Tribunal was right in setting aside and quashing the order passed by the Commissioner of Income Tax under Section 263 of the Income Tax Act, 1961 interpreting Section 44 BB of the afore-stated Act.”
A bare perusal of the question of law would show, that it is linked to the exercise of power under Section 263 of the Act. Clearly no such position arises in the instant case.
Tribunal, in the impugned judgment, while holding in favour of the respondent/assessee, has relied upon its order rendered in DCIT v. Technip UK Limited. [2018 (7) TMI 2335 - DELHI HIGH COURT] This order was passed in [2018 (12) TMI 1069 - ITAT DELHI].
Revenue, says that he will ascertain, as to whether any appeal was lodged with this Court qua the Tribunal’s order - Issue notice.
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2023 (2) TMI 1239 - MADHYA PRADESH HIGH COURT
Seeking grant of anticipatory bail - ill-gotten immovable property, generated through illegal activities related to scheduled offence - HELD THAT:- In the present case, the applicant is apprehending his arrest in connection with the complaint case by the respondent for offence of money-laundering under Section 3 of PMLA Act and punishable under Section 4 of the Act. Though supplementary charge sheet has been filed, but once the prayer for anticipatory bail is made in connection with the offence of PMLA Act, the underlying principles and rigour of Section 45 of the Act gets triggered.
The record submitted by the respondents prima facie shows nexus between the primary offender and the applicant, who is found to be an accessory to money-laundering. From the material collected by the Investigating Agency, considering the nature of allegations and the seriousness of offence alleged, prima facie, at this stage, it cannot be said that the applicant has not committed any offence alleged against him.
The Supreme Court in the case of P. CHIDAMBARAM VERSUS DIRECTORATE OF ENFORCEMENT [2019 (9) TMI 286 - SUPREME COURT] while dismissing the anticipatory bail application has observed that power under Section 438 Cr.P.C. being an extra- ordinary remedy has to be exercised sparingly, more so in cases of economic offences which stand as a different class as they affect the economic fabric of the society.
Thus, no case for grant of anticipatory bail is made out. Accordingly, this application is dismissed.
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2023 (2) TMI 1238 - ITAT DELHI
Admission of additional evidences CIT(A ) in violation of Rule 46A of the Income-tax Rules, 1962 - over-reporting of the value of time deposits deleted by CIT(A) - HELD THAT:- Commissioner (Appeals) exercising statutory power vested with him has called for and examined necessary evidences for deciding the issue. Such exercise of power by learned first appellate authority assumes importance in the present case considering the fact that the assessee did not get a fair opportunity to represent his case before the AO. On a careful reading of the impugned order of Commissioner (A) it is very much clear that considering the fact that the assessee did not get a fair opportunity to represent his case before the AO, Commissioner (Appeals) took the responsibility upon himself to inquire into the matter and in the process has called for necessary evidences, not only from the assessee, but from the concerned bank through the assessee.
After examining the evidences, Commissioner (Appeals) has factually found that the actual quantum of time deposits in Canara Bank was to the tune of Rs.9,50,00,000/-. He has further found that even Rs.9,50,00,000/- deposited in Canara Bank was out of overseas remittances from the income earned by the assessee as a resident in USA for past so many years. No contrary material has been brought on record by the Revenue to disturb the aforesaid factual findings of learned Commissioner (Appeals). Therefore, if, upon examining the material on record Commissioner (Appeals) has recorded a factual finding, without pointing out any deficiency or discrepancy in such finding, the decision of learned Commissioner (Appeals) cannot be reversed merely on the allegation of violation of Rule 46A. Revenue appeal dismissed.
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2023 (2) TMI 1237 - ITAT BANGALORE
TP adjustment - treatment of duty drawback as non-operative in nature for computing the operating margin of the assessee - HELD THAT:- The duty drawback is provided to the manufacturer and exporter for the purpose of compensating in the duty component which is already been included in the cost of raw material and the duty drawback received against the duty paid in our view is part of the operating profit of the assessee.
As relying on Sami Labs. Ltd case [2019 (4) TMI 2110 - ITAT BANGALORE] we remit the issue back to the TPO to verify that export incentive is in respect of turnover of the present year as per the ratio laid down in the above judgement. Needless to say that the assessee be given an opportunity of being heard.
Comparable selection - UMW Industries Ltd - The major part of the revenue derived by the company is from sale of guidance wire. We also notice from the annual report (pg. 1493 of paper book) that one of the major suppliers for the company is Bharat Dynamics which is a Govt. of India Enterprise, which is a manufacturing base for guided weapon systems. Therefore we see merit in the submission of the ld AR that the company supplies the guided wire for defence activities and therefore not comparable with the assessee who supplies machinery to textile industry.
TPO and the DRP have considered the profile of the company as manufacturer of other machinery for textiles, apparel and other industries whereas as per the annual return, the extract of which is reproduced above, the company is engaged in the manufacture of guidance wire and miniature control cable. In view of the discussion, we hold that the functional profile of UMW Industries Ltd. is different from that of the assessee and therefore not comparable. The AO/TPO is directed to exclude the company from list of comparables.
Lohia Corporation Ltd. - assessee contended before the TPO and the DRP that the company incurs significant expenditure towards R&D which is more than 3% on an average for the previous 3 years and assessee on the other hand is a licensed manufacturer and relies on the technical knowhow of which AE to manufacture the product - We notice from the above judicial pronouncements relied on by the assessee that application of R&D filter with a threshold limit of 3% is a settled position now. We also notice that the Bangalore Bench of the Tribunal in the case of KBACE Technologies Pvt. Ltd. [2020 (2) TMI 78 - ITAT BANGALORE] has also taken a similar view. In view of this we direct the TPO to exclude Lohia Corporation Ltd from the list of comparables.
TP adjustment restricted to the value of only international transactions - We hold that the TP adjustment should be restricted only to AE related transaction and direct the TPO/AO to compute the TP adjustment accordingly.
Benefit of adjustment for working capital denied - HELD THAT:- As working capital adjustment is to be allowed as per actuals, after considering the decisions rendered in this order on the exclusion/inclusion of comparable companies out of/into the final set of comparables. The TPO/ AO are accordingly directed.
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2023 (2) TMI 1236 - ITAT AMRITSAR
Addition u/s 68 - Bogus cash sales - AO rejecting the Cash Sales being claimed to be made out of Opening Stocks and purchases made during the year duly supported with the VAT paid on such cash sales as per the VAT returns of the period under consideration - HELD THAT:- Admittedly, the assessee has made cash sales out of the opening stock and purchases made during the year duly supported with audited stamen of account and VAT Return. The authorities below has neither pointed out any discrepancy in the audited books of account nor rejected assessee’s books.
CIT(A) has made contradictory observation in one para that there was no cash sale in the earlier year FY 2015-16 whereas in another para he observed that there was cash sale of Rs. 560204/- in FY 2015-16. Merely, making a comparison of cash sales with the preceding assessment year in hypothetical manner bases on assumption, surmises and conjectures without supporting corroborative documentary evidence to disprove disputed cash sales as bogus sales cannot be approved.
There is no bar in making cash sales by the manufacturer. AO has also admitted that there was cash sale of Rs. 560204/- in Financial Year 2015-16. Thus, the AO wrongly held that no goods in cash was sold during the earlier Financial Year 2015-16. The AO failed to appreciate that there was no excess sale of 546 kgs of shoddy yarn in the range of Rs. 105/- to Rs. 145/-. AR explained that the goods were sold out of balance stock of shoddy yarn and even at the year end, the unsold stocks of shoddy yarn was 2960 kgs with the support of Paper book placed on record.
In the case of “Principal Commissioner of Income Tax, 20, Delhi v. Akshit Kumar”, [2020 (11) TMI 873 - DELHI HIGH COURT] held that the quantum figure and the closing stock which stood accepted in the earlier years had to be taken as actual stock available with the Respondent-Assessee. In view of these facts, the sales made by the Respondent-Assessee out of its opening stock were not treated as unexplained income, to be taxed as income from other sources.
In another case of ‘Anantpur Kalpana v. Income-tax Officer’, [2021 (12) TMI 599 - ITAT BANGALORE] observed that since the sale proceeds for which cash was received from the customers was already admitted as income and if the cash deposits are added under section 68 of the Act that will amount to double taxation once as sales and again as unexplained cash credit which is against the principles of taxation.
On similar fact, in the case of Hirapanna Jewellers [2021 (5) TMI 447 - ITAT VISAKHAPATNAM] as observed that since, the assessee has already admitted the sales as revenue receipt, there is no case for making the addition u/s 68 or tax the same u/s 115BBE again. This view is also supported by the decision of.Kailash Jewellery House [2010 (4) TMI 1070 - DELHI HIGH COURT] and Vishal Exports Overseas Ltd. [2012 (7) TMI 1110 - GUJARAT HIGH COURT]
We hold that the disputed cash sales by the appellant assessee were made out of Opening Stocks and purchases made during the year which are offered for Taxation as revenue receipts as per audited books of accounts and financial statements filed before the authorities below and before us, duly supported with VAT Return. As such, there is no case for making the addition u/s 68 or tax the same u/s 115BBE again. Therefore, the addition is deleted. Assessee appeal allowed.
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2023 (2) TMI 1235 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL PRINCIPAL BENCH, NEW DELHI
Admissibility of Section 7 Application - applicability of Section 5(4) of the SARFAESI - whether the proceeding could have been continued and assignment had no effect on the proceeding? - HELD THAT:- The provisions of Section 5(4) of SARFAESI Act are clear and categorical that mere assignment during pendency of the proceeding, as referred in 5(4) of SARFACEI Act, shall not be prejudicially affected by the reason of acquisition of financial debt by the said JC Flower ARC as the case may be, but the suit or appeal or other proceeding may be continued, prosecuted and enforced by the assignee JC Flower ARC.
By virtue of Section 5(4) of SARFAECI Act, the Application could have been continued and would not have been prejudicially affected by reason of acquisition of the financial asset. But present is the case, where an application has been filed by the Corporate Debtor praying for dismissal of Section 7 Application on which application the Adjudicating Authority passed the order on 19.01.2023 taking note of the Application and granted time to Financial Creditor to file Reply since it has waived notice. Adjudicating Authority categorically directed that the Reply be filed before the adjourned date after duly serving copy to the Corporate Debtor.
The Adjudicating Authority, it having already issued notice on the application, granted time to the Financial Creditor to reply the Application, ought to have considered the Application. At this stage when the Application has not been considered, it is not necessary to express any opinion on the merits of the Application which may prejudice the parties before the Adjudicating Authority.
Let Adjudicating Authority consider the Application and pass fresh order both on Application IA No. 210 of 2023 and Section 7 Application in accordance with law.
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2023 (2) TMI 1234 - CALCUTTA HIGH COURT
Waiver of penalty - HELD THAT:- A connected appeal arising out of the very same impugned order was heard by the Division Bench in Commissioner Of Central Excise, Haldia Commissionerate Versus W.B. Handloom & Powerloom Development Corporation Ltd. (Tantushree)
[2022 (9) TMI 561 - CALCUTTA HIGH COURT], the appeal was allowed and the substantial question of law was answered in favour of the revenue.
Following the above decision, this appeal (CEXA/3/2007) is allowed and the substantial question of law is answered in favour of the revenue.
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2023 (2) TMI 1233 - ITAT KOLKATA
Unexplained cash credit u/s. 68 - identity and creditworthiness of the shareholders and genuineness of the transactions not proved - Onus to prove - directors failed to appear to the summons issued u/s. 131 - HELD THAT:- All the share applicants are (i) income tax assessees, (ii) they are filing their income tax returns, (iii) share application form and allotment letter is available on record, (iv) share application money was made by account payee cheques, (v) details of the bank accounts belonging to share applicants and their bank statements, (vi) in none of the transactions there are any deposit of cash before issuing cheques to the assessee, (vii) all the share applicants are having substantial creditworthiness represented by their capital and reserves.
We notice that all the details were very much placed before the Assessing Officer but while framing the assessment, no efforts have been made by the Assessing Officer to examine the correctness of various proof, filed by the assessee by carrying out any investigation. Merely for non-appearance of the directors, AO disregarded all these documents which have been placed before various statutory authorities including Registrar Of Companies, Income Tax Department and Schedule Banks.
The assessee by way of filing all these documents necessary to prove identity, creditworthiness and genuineness of the alleged transaction, has discharged the initial burden casted upon it under the provisions of section 68 - Unless and until, the assessing authority finds any lacuna or adversity or defect in the said documents, the burden to prove remains on the Revenue authorities. In the instant case, ld. Assessing Officer failed to discharge the burden and summarily disregarded the documents filed by the assessee by merely referring to some decisions and not going into the facts of the case except referring to the price per share.
Since the assessee has sufficiently explained the identity and creditworthiness of the share subscriber companies and the genuineness of the transaction of applying for the equity shares of the assessee company and since nothing contrary to the evidence filed by the assessee has been placed on record by the Revenue, except the reason that the directors failed to appear to the summons issued u/s. 131 of the Act, we find no reason to interfere with the meritorious finding of the Ld. CIT(A). We accordingly dismiss the grounds raised by the revenue in this respect.
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2023 (2) TMI 1232 - CESTAT MUMBAI
Recovery of Central Excise duty alongwith interest and penalty - retention of scrap generated from the raw material received by them from the principal manufacturer namely KEC International, Larsen and Tubro Ltd. etc. - contravention of Rule 4, 6 & 8 of Central excise Rules, 2002 - HELD THAT:- In case of Raaja Magnetics Ltd. [2017 (6) TMI 800 - CESTAT BANGALORE], on similar issue it was held that the value of scrap not includable in assessable value.
The Commissioner (Appeals) has in the appellant own case following the decision of PR. ROLLING MILLS PVT. LTD. VERSUS COMMISSIONER OF C. EX., TIRUPATHI [2009 (3) TMI 444 - CESTAT, BANGALORE] has allowed the appeals and held that the money value of the scrap retained by the appellant does not represents additional consideration for the appellant and it is not liable to be included in the assessable value of job worked goods being cleared on payment of duty to the principal manufacturer. The retention of scrap/ waste arised during job work does not depress the job work conversion charges, the same are not included in the assessable value.
There are no merits in impugned order or the submissions made by the authorized representative - appeal allowed.
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2023 (2) TMI 1231 - KARNATAKA HIGH COURT
Classification of goods - rate of tax - mobile phone chargers sold along with mobile phone in a composite pack - whether attracts tax at the same rate as applicable to "mobile phone" only and it cannot be taxed at higher rate separately? - HELD THAT:- This Court has considered the above question in STRP No.8/2022 & connected matters [2023 (2) TMI 1228 - KARNATAKA HIGH COURT] and answered the question in favour of the assessee and against the Revenue holding that definition contained in the Notification issued under the KVAT Act includes the ‘Charger’ which is sold along with the mobile phone in one set and accordingly taxable at 5%.
Revision dismissed.
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