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Showing 281 to 300 of 1478 Records
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2016 (3) TMI 1206
Rejection of books of accounts - discrepancies in the entries in creditors' accounts - Held that:- No substantial question of law arises in the present appeal. The conduct of the assessee and the books of account produced by him did not inspire confidence and were rightly rejected by the Assessing Officer. Even at the appellate stage, he produced additional evidence in the form of unaudited provisional balance-sheet and tried to take benefit of merely two entries which, in his books of account and the balance-sheet earlier produced, he had shown differently. It cannot be said to be a mere error, rather, it was a deliberate attempt to defraud the Revenue. The relief, which the assessee is claiming at this stage explaining two transactions pertaining to the creditors, cannot be examined in isolation in the absence of other entries in the books of account, which could not be explained by him at the time of assessment as the queries raised by the Assessing Officer were not responded to and complete books of account were not produced. - Decided against assessee.
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2016 (3) TMI 1205
TPA - selection of comparable - Held that:- Assessee-company is engaged in the business of providing back office support services which includes voice/non-voice based technical support services, invoice processing, accounts receivable and collection processing etc., to its holding company. The respondent assessee-company is remunerated by its holding company on a cost plus 10% basis for the services rendered, thus companies dis-similar with that of assessee need to be de-selected from final list of comparable.
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2016 (3) TMI 1204
Reopening of assessment - period of limitation - reasons to believe - Held that:- In the case before us, for both the assessment years, the four years period has expired and there was no negligence on the part of the assessee in producing the material before the Assessing Officer. This Tribunal is of the considered opinion that when the assessee has produced all the relevant material and the Assessing Officer, on the basis of the material filed by the assessee during the course of assessment proceedings, came to the conclusion that the income otherwise chargeable has escaped assessment, there is justification for reopening the assessment after expiry of four years. In view of the above, this Tribunal is of the considered opinion that reopening of assessment for both the assessment years is barred by limitation. Accordingly, the orders of the lower authorities are set aside and the appeals of the assessee for both the assessment years are allowed.
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2016 (3) TMI 1203
Valuation - calculation of sales tax - entry tax - includibility - whether the entry tax amounts collected separately from the customers in the sale bills and paid to the Government will form part of turnover so as to be subjected to levy of sales tax under the KST Act? - Held that: - when a registered dealer is authorised to collect any amount by way of tax, that tax shall not form part of turnover - when it is found that the appellant is a registered dealer, it would entail him to collect the entry tax and such an entry tax cannot be treated as forming part of the turnover - appeal allowed - decided in favor of appellant.
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2016 (3) TMI 1202
Deemed dividend u/s 2(22)(e) - loan taken by the assessee from M/s. Surya Business Pvt. Limited on interest - Held that:- Addition made by the Assessing Officer and sustained by the ld. CIT(Appeals) under section 2(22)(e) on account of loan received by the assessee from M/s. Surya Business Pvt. Limited on which consideration in the form of interest was paid by the assessee to the benefit of the Company is not sustainable. We, therefore, delete the same. See Pradip Kumar Malhotra Versus Commissioner of Income-tax, West Bengal-V [2011 (8) TMI 16 - CALCUTTA HIGH COURT ] as held that gratuitous loan or advance given by a Company to those classes of shareholders thus would come within the purview of section 2(22)(e) but not the cases where the loan or advance is given in return to an advantage conferred upon the Company by such shareholder. - Decided in favour of assessee
Disallowance of travelling & conveyance, telephone expenses and sales promotion expenses - Held that:- the assessee has not been able to establish that proper record in the form of log book, call register, etc. is maintained by the assessee in order to show that all the expenses incurred under these three heads are wholly and exclusively for the purpose of assessee’s business. Keeping in view this failure of the assessee and having regard to the nature of expenses claimed, we find ourselves in agreement with the authorities below that the involvement of personal element in these expenses cannot be ruled out and since the disallowance made at 10% for such personal element, in our opinion, is quite fair and reasonable, we find no justifiable reason to interfere with the same. - Decided against assessee
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2016 (3) TMI 1201
TPA - selection of comparable - Held that:- As the assessee had declared income from software development, training and product both in the domestic and export market and is off-site developer,companies dissimilar with that of assessee need to be deselected from final list of compatibles.
Also where the R&D filter is more than 3% not to be taken in the final list of comparables.
Working of profit before depreciation and the allowability of its adjustment - Held that:- In view of our deciding other aspects of transfer pricing adjustment, we are of the view that final adjustments, if any, would fall within + / - 5% range and no adjustment is to be made to international transaction entered into by the assessee. Accordingly, we do not address the issue of exclusion of depreciation from operating cost while benchmarking international transaction of the assessee at present.
TP adjustment made under sections 10A and 10B - Held that:- The provisions of the Act are clear in not allowing any deduction on any TP adjustment made under sections 10A and 10B of the Act. Where the section itself provides that no deduction under section 10A of the Act is to be allowed on any transfer pricing adjustment, then corollary to the same is that transfer pricing adjustment can be made in the case of concerns which are claiming deduction under sections 10A and 10B of the Act
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2016 (3) TMI 1200
TPA - comparables selection - Held that:- Companies being a product based companies may not strictly comparable to a service company like that of Assessee. Companies dissimilar in functionality with that of assessee need to de-selected from final list of comparable.
Deduction (+) or (-) 5% as a standard deduction - Held that:- The second proviso to Section 92C(2) does not apply to the impugned order. The pre-amended proviso, as interpreted by various authorities does permit standard deduction of (+) or (-) 5% to Assessee. The order of Ld.CIT(A) is confirmed. The Revenue’s ground is rejected accordingly.
Exclusion of certain expenditure from total turnover which are excluded from export turnover by AO - Held that:- Expenditures were excluded from export turnover stating to be for telecommunication and for rendering services. Assessee while contending that the said expenditure should not be excluded, made alternative contention that the same are to be excluded from total turnover. Following the Co-ordinate Bench decision in Tata Elxsi case [2011 (8) TMI 782 - KARNATAKA HIGH COURT ], the Ld.CIT(A) directed the same to be excluded from total turnover as well. Therefore, we uphold the same and reject Revenue’s grounds.
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2016 (3) TMI 1199
Validity of assessment proceedings - absence of proper service of notice issued u/s. 143(2)- service of notice through substituted manner - Held that:- There is no mention in the Panchnama that enquiries were made from neighbors of the assessee in respect of his whereabouts. The reasons for joining the witness from far of location and whether the witnesses were able to identify the name and address of the assessee, the reasons for not joining the witness from local area are also not specified. Thus, raising a cloud of suspicion on the genuineness of service even through affixation. Order V of Rule 20 clearly states that the court shall order for substitute service if it is satisfied that there is reason to believe that the defendant is purposely avoiding service or the summons could not be served or there are any special reasons that summons could not be served in ordinary way. In the present case we find that no such satisfaction has been recorded by the Assessing Officer before directing service of notice through substituted manner.
In the present case, since, the notice u/s. 143(2) has not been validly served on the assessee the proceedings arising there from are vitiated. Thus, in view of the provisions of the Act we are of considered view that proper service of notice u/s. 143(2) is mandatory. The Department cannot take the shelter of section 292BB where there is no proper service of notice u/s. 143(2) and the assessee has participated in assessment proceedings. Non-service of notice u/s. 143(2) is fatal to the assessment proceedings. In the absence of proper and valid service of notice, the proceedings arising therefrom are null and void and are thus liable to be annulled. - Decided in favour of assessee
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2016 (3) TMI 1198
TPA - selection of comparable - Held that:- Assessee being an investment advisory services where core functions is to give advice for making the investments in diversified fields companies dissimilar with that of assessee need to be discarded from final list of comparable.
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2016 (3) TMI 1197
Maintainability of petition - monetary limit for filing appeal - Held that: - the disputed amount is only ₹ 68,630/-. The C.B.E. & C. Circular dated 17-8-2011 would not permit filing of appeals before the High Court involving tax effect of less than ₹ 10 lacs - also, there was a delay of 6 days which is not condoned - petition dismissed.
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2016 (3) TMI 1196
Inclusion of Modvat in opening stock in the light of Section 145A - Held that:- We find that the impugned order of the Tribunal after holding that Section 145A of the Act, which was brought into effect on 1st April, 1999 holds it would have application while determining the income chargeable to tax for the Assessment Year 1999-2000.
In the above view, the impugned order of the Tribunal set aside the order of the Commissioner of Income Tax (Appeals) at the instance of the Revenue and restored the issue to the Assessing Officer for de novo adjudication in accordance with the provisions of Section 145A of the Act.
The grievance of the Revenue that for earlier Assessment Years i.e. Assessment Years 1997-98 and 1998-99, the Tribunal had deleted Modvat from the valuation of closing stock. Therefore, it is obliged on the principle of consistency to have not directed the inclusion of Modvat in the valuation of opening stock. This submission completely overlooks the change in law with effect from 1st April, 1999 due to introduction of Section 145A in the Act. In the above view, no occasion to invoke the principle of consistency can arise. Thus, there is no merit in the above submission.
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2016 (3) TMI 1195
Condonation of delay - Non-granting of registration u/s.12AA - Held that:- There is no condonation petition filed by the assessee to condone the delay. However, there was a petition filed by the ld.A.R dated 7th March, 2016 seeking condonation of delay in filing the appeal stating that order of CIT u/s.12AA was received and handed over to the assessee’s counsel Mr.A.Johnson,FCA for further action, and the assessee solely relied on the professional assistance from Chartered Accountant, who had failed to take necessary action in filing the appeal before this Tribunal.
Even there is no confirmation from the Chartered Accountant owing the responsibility. In such circumstances, there is no good and sufficient reason to condone the delay. Inordinate delay of 163 days solely attributable to negligence and inaction on the part of the assessee, which could have been avoided by exercise of due care and attention, did not constitute good reason for condonation of delay. Accordingly, by placing reliance on the judgement of Supreme Court in the case of Vedabai Alias Vaijayanatabai Baburao Patil v. Shantaram Baburao Patil And Others reported in [2001 (7) TMI 117 - SUPREME Court] we are declined to admit the appeal. Accordingly, the appeal is dismissed as unadmitted.
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2016 (3) TMI 1194
Depreciation on Wind Energy Generators - Held that:- Respectfully following the findings of the Tribunal in asseessee's own case, we hold that the assessee is eligible for depreciation wherein held the section requires that the assessee must use the asset for the "purpose, of business". It does not mandate usage of the asset by the assessee itself. As long as the asset is utilized for the purpose of business of the assessee, the requirement of section 32 will stand satisfied, notwithstanding non-usage of the asset itself by the assessee. The assessee did use the vehicles in the course of its leasing business. The fact that the trucks themselves were not used by the assessee was irrelevant for the purpose of the section. - Decided n favour of assessee
Disallowance made u/s. 14A - Held that:- As decided in assessee's own case for A.Y. 04-05 & 05-06 we are of the view that the matter with respect to Nil disallowance under 14A be remitted back to the file of AO for examining it afresh. Thus the matter is remitted to the file of AO and he is directed to admit the issue and decide the issue afresh on merits. as per law after considering the submissions made by the Assessee and after giving a reasonable opportunity of hearing to the Assessee. Assessee is also directed and furnish promptly the details called for by the AO to decide the issue. Thus this ground of the Assessee is allowed for statistical purposes.
Disallowance of loss on write off of preference shares - Held that:- We find force in the contention of the ld. counsel that as per the ratio laid down by the Hon’ble Supreme Court in the case of UCO Bank (1999 (9) TMI 4 - SUPREME Court) the bank is free to value its inventories “securities” at cost or market price whichever is lower. Since the entire issue of write off has not been looked upon by the lower authorities in this perspective, we, therefore, restore the matter to the files of the A.O. The A.O is directed to examine this issue in the light of the ratio laid down by the Hon’ble Supreme Court in the case of UCO Bank (supra) and Banking Regulation Act and decide afresh after giving a reasonable and sufficient opportunity of being heard to the assessee
Exempt income of ₹ 3606 lakhs, HTM investments-8803 lakhs and Foreign Exchange Fluctuation-6.29 lakhs - Held that:- We find that these claims were not entertained by the revenue authorities, following the decision of the Hon’ble Supreme Court given in the case of Goetze India Ltd. [2006 (3) TMI 75 - SUPREME Court] since the assessee has not made the claim by filing a revised return of income, the claim was denied. However, this issue is no more res integra as it is now a well settled proposition of law that the assessee can make a new claim as held by the Hon’ble High Court of Bombay in the case of Pruthvi Brokers and Shareholders Pvt. Ltd. [2012 (7) TMI 158 - BOMBAY HIGH COURT]. In the light of the ratio laid down by the Hon’ble Bombay High Court, we restore the entire issue to the files of the A.O.
Addition made towards Gain on securitization amortized as per RBI guidelines - Held that:- The amortization merely represents a timing difference and since the bank is consistently making profits and paying tax at the highest rate without claiming any tax holiday benefit, it can be safely concluded that the method followed is revenue neutral. We draw support from the decision of the Hon’ble High Court of Bombay in the case of Nagri Mills Co. Ltd. [1957 (9) TMI 30 - Bombay High Court ]. We accordingly set aside the findings of the ld. CIT(A) and direct the A.O to delete the addition
Interest u/s 244A - Held that:- We find force in the contention of the ld.counsel, the assessee is entitled for the interest u/s. 244A of the Act as per the provisions of the law. If the refund was not delayed for reasons attributable to the assessee. We, therefore restore this issue to the files of the A.O. The A.O is directed to recompute the refund allowable to the assessee after giving appeal effect and allow interest u/s. 244A of the Act. If it is found that the delay is not attributable to the assessee.
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2016 (3) TMI 1193
Provisional attachment of the properties - Prevention of Money Laundering - Held that:- Having regard to the fact that the time granted by the learned Single Judge for consideration of the request of the writ petitioner/respondent No.1 herein for substitution of property attached has already expired, we direct that the appellant herein shall consider the request of the writ petitioner/respondent No.1 herein in terms of the directions in the order under appeal within two weeks from today.
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2016 (3) TMI 1192
Penalty u/s 78 of FA, 1994 - Work Contract Service - invocation of section 80 - Held that: - the entire demand as per SCN, except for a nominal interest of ₹ 3,725.30 was paid by respondent before issuance of SCN - The fact that respondent is an illiterate civil contractor was considered by the original authority and waived penalty u/s 78 while adjudicating the SCN of subsequent period - mere non-declaration cannot be considered as suppression of facts - Commissioner (Appeals) has rightly waived the penalty imposed u/s 78 of FA, 1994, by invoking section 80 - appeal dismissed - decided against Revenue.
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2016 (3) TMI 1191
Rate of tax to be applied for the income received by the assessee - PE in India - DTTA - AO and the FAA held that the assessee had PE in India and were of the opinion that tax liability had to computed as per the provisions of section 115A and the assessee should have paid tax @20/30% - Held that:- We find that the assessee had issued 10 invoices to three Indian parties, that only one invoice was issued to GIPCL, two to NLC and balance seven to MNBECL. A close scrutiny of the invoices prove that the assessee had rendered services that were of consultancy nature and therefore same are governed by the provisions of Article 12 of the DTAA. In our opinion, for computing continuous stay for PE purpose actual stay of employees has to be considered and not the entire contract period.
We find that the assessee had deputed one of its employee Dr. Dittrich to India and he had not stayed in India for more than 180 days. The assessee had informed the AO that Dr. Dittrich had visited India in pursuance of the agreements entered into with NLC and MNBCEL. It is also a fact the in two of the contracts no supervisory charges were booked by the assessee for the year under appeal, that the assessee had offered its income under the head FTS in its return. Article 12(4)deals with FTS and talks of services of managerial, technical or consultancy nature. Considering the above, we are of the opinion that payments received by the assessee should be assessed as per the provisions of Article 12 and not as per Article 7 of the Indo- German DTAA.
In these circumstances, reversing the order of the FAA, we hold that the payments received by the assessee from GIPCL, NLC and MNBECL have to be taxed @10% and that the provisions of section 115A would not be applicable. Effective ground of appeal is decided in favour of the assessee.
Interest levied u/s. 234B - Held that:- The issue stood decided in favour of the assessee by the decision of the Hon’ble Uttranchal High Court delivered in the case of Sedco Forex International Drilling Co. Ltd. (2003 (10) TMI 40 - UTTARANCHAL High Court) and Asia Satellite telecommunications Ltd. (2002 (11) TMI 263 - ITAT DELHI-C ). Before us, the Representatives of both the sides agreed that the Hon'ble Bombay High Court in the case of NGC Network Asia LLC (2009 (1) TMI 174 - BOMBAY HIGH COURT ) has held that where the payment is subject to tax deduction the assessee is not liable to pay advance tax. - Decided against the Assessing Officer.
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2016 (3) TMI 1190
Imposition of Penalty - the petitioner was compelled to immediately pay the amount of penalty and when the petitioner's men insisted that there be an order - Held that: - since the rule requires any seizure and detention and while imposing a penalty, unless preceded by an order, any action of seizure or detention or collection of penalty would be bad in law - even if any order is passed, it is an after-thought since it is not on record that it has been duly served on the petitioner - penalty set aside - petition allowed - decided in favor of petitioner.
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2016 (3) TMI 1189
Addition of expenditure as bogus - mandatory provisions of Section 44AD/44AF read with Rule 6DD (e)(i) ignored - Held that:- The orders of the A.O and CIT(A) cannot be sustained as such. It is obvious that Assessee has used a wrong form and also reflected the income from business under the head ‘other sources’. It is the duty of the A.O to advice the Assessee when certain procedural / technical mistakes were committed by Assessee. The A.O should not take advantage of mistakes committed by the Assessee, while discharging statutory duties. Assessee’s entire turnover, as accepted by the A.O, was only ₹ 16,58,500/- and provisions of 44AD of the IT Act would automatically apply. Since Assessee has declared more income than required under provisions, A.O should have accepted the same. The benefits provided to small time Assessees / small business persons cannot be denied by A.O. The order of the Ld. CIT(A) also was without considering the grounds raised before him. In view of that, in the interest of justice, I set aside the orders of the A.O and CIT(A) and restore the assessment to the file of A.O to be redone, after giving due opportunity to Assessee. A.O can advise Assessee to file a proper form of return if required, before completing the assessment. - Decided in favour of assessee for statistical purposes.
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2016 (3) TMI 1188
Maintainability of petition - after a long lapse of five years, the present impugned orders dated 25.5.2015 have been passed, confirming the original assessment of tax and penalty on the very same grounds and according to the petitioners, it is nothing but non-application of mind on the part of the respondents - Held that: - the first respondent has passed the impugned orders without following the directions issued by this Court as well as the direction issued by the second respondent on two different occasions and at the same time, the first respondent did not even consider the petitioners' reply - the delay in considering the claim of the petitioners, played a pivotal role in the case on hand and thus, the orders impugned herein, have no legs to stand and therefore, they are liable to be interfered with on this ground too - the impugned orders are liable to be set aside - matters are remanded to the authorities for consideration afresh and the respondents are directed to consider each and every aspect on the basis of the materials available - appeal allowed by way of remand.
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2016 (3) TMI 1187
Clandestine removal - The Department detected that the appellant had not properly accounted for the manufactured goods in the Daily Stock Account i.e. RG-I register. It is also observed that there is shortage/ excess of finished goods and raw material as compared to the accounts maintained by the appellant - Held that: - the appellant has not furnished any justifiable reason to negate the case of Revenue that the goods were not clandestinely removed from the factory without payment of Central Excise duty. Further, the appellant has also not furnished any valid reason for non maintenance of its statutory records properly. Thus, the duty demand confirmed by the authorities below and imposition of penalty are in conformity with the statutory provisions.
Imposition of redemption file of ₹ 20,000/- on the seized goods valued at ₹ 62,581/- is in the higher side, which can be reduced in the interest of justice. Thus, the redemption file is reduced from ₹ 20,000/- to ₹ 5,000/-.
Appeal allowed - decided partly in favor of appellant.
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