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2013 (5) TMI 976
Issues Involved:
1. Restraining the Company from convening and holding the proposed Extraordinary General Meeting (EGM).
2. Applicant's legitimate expectation to be part of the management.
3. Compliance with statutory provisions for calling EGM.
4. Allegations of mismanagement and mala fide actions by the Applicant.
5. Democratic rights of shareholders to call for EGM and remove a director.
Summary:
Issue 1: Restraining the Company from convening and holding the proposed EGM
The Applicant sought to restrain the Company from holding the proposed EGM on 26.04.2013, arguing that the meeting aimed to remove him from the board, which he claimed was unjustified. The Respondents countered that the EGM was convened in accordance with the Act and that the Applicant had engaged in several mala fide actions, including filing multiple complaints to various authorities.
Issue 2: Applicant's legitimate expectation to be part of the management
The Applicant, holding 20% of the equity shareholding along with his wife, claimed a legitimate expectation to be part of the Company's management. However, the Respondents highlighted that the Applicant had not participated in several board meetings and Annual General Meetings over the years, despite receiving notices.
Issue 3: Compliance with statutory provisions for calling EGM
The court examined whether a shareholder had the right to requisition an EGM and move a resolution to remove a director. It was found that the requisitionist, a shareholder holding 7,000 fully paid-up equity shares, had complied with Section 169 and Section 284 of the Act. The Company followed the due procedure by issuing notices and convening the EGM as per the statutory requirements.
Issue 4: Allegations of mismanagement and mala fide actions by the Applicant
The Applicant alleged that the Respondents committed gross mismanagement and that the notice for the EGM was issued by a person whose appointment was under challenge. The Respondents argued that the Applicant's actions had caused significant disruption to the Company's operations and that his removal was justified. The court noted that the Applicant had addressed several complaints to various authorities, which had hampered the Company's day-to-day functioning.
Issue 5: Democratic rights of shareholders to call for EGM and remove a director
The court emphasized that every shareholder has the right to call an EGM and move resolutions, as per the statutory provisions. The Applicant could not preemptively seek to restrain the Company from holding the EGM on the grounds that he might be removed. The court referred to the Supreme Court's decision, which upheld the democratic rights of shareholders to call and hold EGMs.
Conclusion:
The court concluded that the Applicant had not made out a case to grant the reliefs sought. The requisitionist had the right to call for the EGM, and the Company had followed the due procedure. The Applicant's claim of legitimate expectation did not entitle him to prevent the democratic process of the shareholders. The application to restrain the Company from holding the EGM was dismissed, and no orders as to costs were made.
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2013 (5) TMI 975
Issues involved:
The judgment involves the rejection of addition made by the Assessing Officer as Long Term Capital Gain and Short Term Capital Gain, and the consideration of unabsorbed depreciation for requisite set off.
Long Term Capital Gain:
The Assessee transferred fixed assets for land, plant, machinery, and office equipment without offering capital gains. The Assessing Officer proposed short term capital gains of Rs. 65.55 lacs, with unabsorbed depreciation of Rs. 200,31,133/-. The Department accepted carry forward depreciation for certain years but did not allow set off for the current year's capital gains. The Tribunal found that land sale should be considered long term capital gains, not depreciable assets. The matter was sent back to the Assessing Officer for proper consideration.
Short Term Capital Gain:
The Assessing Officer computed short term capital gains based on the asset's written down value (WDV) at the beginning of the year. The Tribunal noted that the WDV of assets indicated short term capital gains of Rs. 2,45,109/-. The Assessing Officer disallowed set off of unabsorbed depreciation from previous years, citing provisions of sections 70 to 80 of the Act. The Commissioner affirmed this decision, stating that the Assessee's failure to file returns for certain years prevented the allowance of set off.
Unabsorbed Depreciation Set Off:
The Assessee argued for the adjustment of unabsorbed depreciation against current year's capital gains u/s 32(2) of the Act. The Commissioner upheld the disallowance, citing the Assessee's failure to file returns for specific years. The Assessee contended that the decision in the case of Haryana Hotels Ltd. supported the allowance of unabsorbed depreciation set off. The Tribunal agreed, stating that there is no mandatory provision requiring the Assessee to file returns for unabsorbed depreciation set off. Consequently, the orders of the lower authorities were set aside in favor of the Assessee.
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2013 (5) TMI 974
Issues Involved:
1. Whether the documents annexed to the complaint u/s 2(d) of the Criminal Procedure Code constitute part of the complaint.
2. Whether the complaint filed by the respondents is vague and does not disclose the offence alleged against the petitioners.
Summary:
1. Documents Annexed to Complaint u/s 2(d) Cr.P.C.:
The primary issue was whether the documents annexed to the complaint u/s 2(d) of the Cr.P.C. constitute part of the complaint and can be looked into for making out the offence alleged. The court examined relevant provisions of the Cr.P.C., including Sections 2(d), 173, 200, 207, and 238, and concluded that a complaint under section 2(d) Cr.P.C. must be complete in itself and cannot rely on annexed documents to disclose the offence. The court held that the documents appended to the complaint do not form part of the complaint and cannot be considered for making out the offence alleged.
2. Vagueness of Complaint:
The petitioners argued that the complaint was vague and lacked specific allegations necessary to disclose the offence. The court noted that the complaint did not specify what arrangements were missing in the factory or what information, instruction, training, or supervision was necessary. The complaint merely stated general allegations without particulars. The court referred to previous judgments, including Transport Corporation of India Limited & Ors. vs. R.M. Gandhi & Ors. and Keki Bomi Dadiseth & Ors. vs. State of Maharashtra, which emphasized the requirement for complaints to contain specific factual allegations to constitute an offence. The court found substance in the petitioners' arguments and held that the complaint was vague and did not disclose the offence alleged.
Conclusion:
The court concluded that the complaint filed by the respondent was vague and did not disclose the offence alleged against the petitioners. The court allowed the revision application and quashed the proceedings, stating that continuation of such proceedings would amount to an abuse of process of law.
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2013 (5) TMI 973
The High Court of Bombay disposed of an arbitration petition on 2nd May, 2013. The parties tendered signed Minutes of the Order, and no costs were awarded.
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2013 (5) TMI 972
The Supreme Court dismissed the special leave petition as it was only an ad interim order. The Court recommended that the notice of motion be decided within two months for the benefit of all parties involved.
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2013 (5) TMI 971
Issues involved: Challenge to the validity of initiation of revision proceedings u/s 263 of the Income-tax Act by Ld. CIT.
Summary:
The appeals were filed by the assessee challenging the orders passed by Ld. CIT u/s 263 of the Income-tax Act for the assessment years 2006-07 and 2007-08. The assessing officer estimated income at 10% of the gross receipts after necessary inquiries. Ld. CIT initiated revision proceedings u/s 263, stating that the methodology resulted in underestimation of total income. The Ld. CIT directed to re-do the assessments by determining income from godown receipts separately. The assessee argued that assessments were completed based on estimates due to lack of proper books of accounts. The assessing officer considered all aspects and proposed to enhance the estimate. The assessing officer's view was deemed plausible, and the revision orders by Ld. CIT were set aside for both years. The assessing officer's actions were considered reasonable, and the appeals of the assessee were allowed.
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2013 (5) TMI 970
Central Administrative tribunal (tribunal) - Appellant (IPS Officer) was on deputation - Punishment of Compulsory Retirement - Misconduct of an Administrative nature or of a serious nature - Respondent No. 1 against the order of the Tribunal raising a very large number of grievances. The Appellant was running from pillar to post as he had been harassed and penalised for no fault of his own and has been awarded a punishment which is uncalled for. Thus, he had moved the Tribunal, High Court of Delhi and this Court several times.
Appellant submitted that there has been misreading of evidence by the High Court of Delhi that charge Nos. 4 and 6 have been proved fully. The charges were trivial in nature and could not warrant the punishment of compulsory retirement. The Appellant faced departmental proceedings for six years and had been deprived of being considered for further promotion. He is due to retire in December, 2013. The Appellant remained under suspension for 11 months and was dismissed from service for about 19 months. He had been granted 'Z' class protection initially which was subsequently scaled down to 'Y' category. The Appellant was given the said security/protection even during the period of suspension and dismissal. Even during that period he had been provided with a bullet proof car and PSOs as he had been facing threats from naxalites. Therefore, the punishment so imposed is to be set aside.
Charge no. 4 Favoritism and manipulation in the selection of Headmaster, BSF Primary School Kadmatala even though the candidate did not possess essential qualification and was not eligible.
Charge no.6 Misuse of official vehicle, arms and ammunition and BSF personnel during the marriage of his son in Feb. 2006 at his native place in Balia, UP.
Whether the punishment of compulsory retirement awarded by the Disciplinary Authority is proportionate to the delinquency proved - HELD THAT:- In both the cases the misconduct seems to be of an administrative nature rather than a misconduct of a serious nature. It was not the case of the department that the Appellant had taken the escort vehicle with him. There was only one vehicle which was an official vehicle for his use and charge No. 6 stood partly proved. In view thereof, the punishment of compulsory retirement shocks the conscience of the court and by no stretch of imagination can it be held to be proportionate or commensurate to the delinquency committed by and proved against the Appellant. The only punishment which could be held to be commensurate to the delinquency was as proposed by the Government of India to withhold two increments for one year without cumulative effect. It would have been appropriate to remand the case to the disciplinary authority to impose the appropriate punishment. However, considering the chequered history of the case and in view of the fact that the Appellant had remained under suspension for 11 months, suffered the order of dismissal for 19 months and would retire after reaching the age of superannuation in December 2013, the facts of the case warrant that this Court should substitute the punishment of compulsory retirement to the punishment proposed by the Union of India i.e. withholding of two increments for one year without having cumulative effect.
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2013 (5) TMI 969
Issues Involved:
1. Validity of the order passed u/s 263 by the Commissioner.
2. Adequacy of the enquiry conducted by the Assessing Officer.
3. Whether the assessment order was erroneous and prejudicial to the interest of revenue.
Summary:
1. Validity of the order passed u/s 263 by the Commissioner:
The assessee challenged the revision order passed u/s 263 of the IT Act for the Assessment Year 2007-08, arguing that the Commissioner failed to provide proper reasons for deeming the assessment order erroneous and prejudicial to the interest of revenue. The Commissioner invoked u/s 263 based on a perceived discrepancy between the assessed income and undisclosed income, supported by the statement of Shri Deepak Vasant and seized documents.
2. Adequacy of the enquiry conducted by the Assessing Officer:
The assessee contended that the Assessing Officer had conducted a thorough enquiry regarding the documents at pages 36, 38, and 39 of bundle no.1, which were related to the alleged on-money transactions. The Assessing Officer issued a show-cause notice and received detailed explanations from the assessee, which included corroborative evidence from the cash book. The Tribunal noted that the Assessing Officer had indeed conducted an enquiry and was satisfied with the explanations provided by the assessee.
3. Whether the assessment order was erroneous and prejudicial to the interest of revenue:
The Tribunal emphasized that for an order to be revised u/s 263, it must be both erroneous and prejudicial to the interest of revenue. The Commissioner failed to provide a definitive finding that the assessment order was erroneous. The Tribunal highlighted that the Commissioner cannot direct further enquiry without establishing that the original order was unsustainable in law. The Tribunal referenced several judicial precedents, including CIT vs Vikash Polymers and CIT vs Development Credit Bank Ltd, to support its conclusion that the order passed by the Assessing Officer was a possible view and not erroneous.
Conclusion:
The Tribunal set aside the revision order passed u/s 263, holding that the Commissioner did not demonstrate that the assessment order was erroneous and prejudicial to the interest of revenue. The appeal of the assessee was allowed.
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2013 (5) TMI 968
Title: Supreme Court dismisses appeal
Judges: Mr. Altamas Kabir, Mr. Vikramajit Sen, Mr. Kurian Joseph
Decision: Appeal dismissed after hearing Ms. Indu Malhotra, senior counsel for the appellant.
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2013 (5) TMI 967
Issues involved: Interpretation of previous judgment, application for modification of judgment, delinking of writ petition from previous bunch of writ petitions, recall of judgment, consent of parties.
In the present case, the learned Counsel for the petitioner argued that the issue in the instant writ petition had already been addressed in a previous judgment related to a bunch of writ petitions. The previous judgment had quashed certain circulars and a demand notice, with directions for refunding duty and interest. However, due to confusion during arguments, the instant writ petition was delinked from the previous bunch of writ petitions. An application was filed to modify the judgment, which was allowed, recalling the previous judgment. The opposite parties did not dispute that the controversy in the instant writ petition was identical to the previous case. With the consent of the parties, the writ petition was allowed in line with the previous judgment. The office was directed to issue certified copies of both orders to the respective parties as per High Court Rules.
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2013 (5) TMI 966
Issues Involved:
1. Examination of independent witnesses.
2. Compliance with Section 50 of the Narcotic Drugs and Psychotropic Substances Act, 1985.
3. Determination of commercial and non-commercial quantity.
4. Non-production of the scooter in court.
Summary:
1. Examination of Independent Witnesses:
The appellant contended that the prosecution failed to examine independent witnesses despite the search and seizure occurring in a public place (a 'dhaba'). The court held that there is no absolute rule requiring independent witnesses and that the testimony of police officers can be relied upon if found reliable and trustworthy. The court cited precedents such as *State of U.P. v. Anil Singh* and *State, Govt. of NCT of Delhi v. Sunil and Anr.*, emphasizing that the quality of evidence is more important than the quantity.
2. Compliance with Section 50 of the Act:
The appellant argued non-compliance with Section 50 of the Act, which mandates informing the accused of their right to be searched in the presence of a gazetted officer or a Magistrate. The court found this contention without merit, as the contraband was seized from the tool box of the scooter and not from the person of the accused. The court referenced *Ajmer Singh v. State of Haryana* and *Madan Lal v. State of H.P.*, which held that Section 50 is not applicable when the search is of a vehicle and not the person.
3. Determination of Commercial and Non-Commercial Quantity:
The appellant argued that the seized opium should be considered non-commercial based on the morphine content (1.66%) and the amendment to the Act in 2001. The court rejected this argument, stating that the amendment does not apply retroactively to cases pending before its enactment. The court cited *Basheer Alias N.P. Basheer v. State of Kerala* and *Nayak Ramesh Chandra Keshavlal v. State of Gujarat*, which upheld the constitutional validity of the proviso to Section 41(1) of the Amending Act, 2001, and clarified that the amendment is not applicable to cases pending before its enactment.
4. Non-Production of the Scooter in Court:
The appellant contended that the non-production of the scooter in court created a significant gap in the prosecution's case. The court dismissed this argument, noting that all documents related to the scooter were seized, and witnesses had consistently mentioned the scooter's registration number. The court concluded that the non-production of the scooter did not affect the prosecution's case, describing the argument as "much ado about nothing."
Conclusion:
The Supreme Court dismissed the appeal, finding no merit in the appellant's contentions and upholding the conviction and sentence imposed by the lower courts.
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2013 (5) TMI 965
Whether ‘Jugaad’ is a vehicle under the Act, and in case, it is a motor vehicle under Section 2(28) of the Act, whether such ‘Jugaad’ is required to be insured and registered before it is permitted to ply on the road and whether the driver of ‘Jugaad’ must compulsorily have a driving licence - Originally this petition had been filed challenging the judgment and order of the Rajasthan High Court. wherein the complete liability of providing compensation in a vehicular accident had been fixed upon the appellant-Rajasthan State Road Transport Corporation (hereinafter referred to as the ‘RSRTC’), while unfastening the liability of the driver and the owner of the vehicle, known as ‘Jugaad’, under the provisions of Act.
HELD THAT:- The `Jugaad’ is covered in the definition of the motor vehicle under Section 2(28) of the Act, the statutory authorities cannot escape from their duty to enforce the law and restrain the plying of `Jugaad’. The statutory authorities must ensure that `Jugaad’ can be plied only after meeting the requirements of the Act. The same has become a menace to public safety as they are causing a very large number of accidents. ‘Jugaads’ are not insured and the owners of the `Jugaad’ generally do not have the financial capacity to pay compensation to persons who suffer disablement and to dependents of those, who lose life. Thus, considering the gravity of the circumstances, the statutory authorities must give strict adherence to the circular by the Central Government. court clarify that it is open to the statutory authorities to make exemptions by issuing a notification/circular specifically if such a vehicle is exclusively used for agricultural purposes but for that sufficient specifications have to be provided so that it cannot be used for commercial purposes.
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2013 (5) TMI 964
Application u/s 311 of the Cr.P.C. filed by the applicants/petitioners rejected by the Trial Court, as well as of the High Court - Seeking permission to examine key witness - Prevention of Corruption Act, 1988 (Act) against the Appellant and other accused persons - HELD THAT:- An application filed u/s 311 Crpc must be allowed if fresh evidence is being produced to facilitate a just decision, however, in the instant case, the learned Trial Court prejudged the evidence of the witness sought to be examined by the Appellant, and thereby cause grave and material prejudice to the Appellant as regards her defence, which tantamounts to a flagrant violation of the principles of law governing the production of such evidence in keeping with the provisions of Sec. 311 Code of Crpc By doing so, the Trial Court reached the conclusion that the production of such evidence by the defence was not essential to facilitate a just decision of the case. Such an assumption is wholly misconceived, and is not tenable in law as the accused has every right to adduce evidence in rebuttal of the evidence brought on record by the prosecution.
The court must examine whether such additional evidence is necessary to facilitate a just and proper decision of the case. Furthermore, the same is not a case where if the application filed by the Appellant had been allowed, the process would have taken much time. In fact, disallowing the said application, has caused delay. No prejudice would have been caused to the prosecution, if the defence had been permitted to examine said three witnesses.
Hence, The appeal succeeds and is allowed. The judgment and order of the Trial Court, as well as of the High Court impugned before us, are set aside. The application Under Section 311 Code of Criminal Procedure filed by the Appellant is allowed.
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2013 (5) TMI 963
Issues Involved:
1. Authority of State to seal business premises.
2. Compliance with SEBI regulations.
3. Legality of collective investment schemes.
4. Petitioners' right to operate business and bank accounts.
Issue 1: Authority of State to Seal Business Premises
The petitioners challenged the respondent State's authority to seal their business premises, arguing that the State had no legal basis for such action. The petitioners' counsel contended that the company was engaged in real estate business, not non-banking finance business, and had been exonerated by the Circle Officer, Ramgarh in 2012. However, the district administration raided and sealed the office without prior notice in February 2013. The State justified the action u/s 94 of the Cr.PC, citing complaints and the need to protect investors. The court found that the State acted within its authority due to the complaints and the public notice by RBI about illegal deposit acceptance.
Issue 2: Compliance with SEBI Regulations
SEBI argued that the petitioners were operating a collective investment scheme without registration, violating the SEBI Act, 1992. SEBI had issued a show-cause notice in November 2012, which the petitioners responded to inadequately. SEBI's findings indicated that the petitioners' schemes involved pooling of resources, profit expectations, and management by the company, fitting the definition of a collective investment scheme u/s 11AA of the SEBI Act. The court noted SEBI's ongoing inquiry and directed SEBI to conclude it within six weeks.
Issue 3: Legality of Collective Investment Schemes
The court examined SEBI's findings that the petitioners' schemes were collective investment schemes requiring registration, which the petitioners lacked. SEBI's analysis of documents showed that the petitioners accepted contributions for land development without allotting specific plots, managed the land on behalf of investors, and pooled resources, indicating a collective investment scheme. The court referenced the Supreme Court's judgment in P.G.F. Ltd v. Union of India, which upheld the constitutionality of section 11AA of the SEBI Act and imposed costs for frivolous litigation.
Issue 4: Petitioners' Right to Operate Business and Bank Accounts
The petitioners sought to unseal their premises and operate their bank accounts, arguing that no interim or final order from SEBI restrained their activities. SEBI countered that allowing the petitioners to operate would enable continued violations. The court, considering SEBI's findings and the need to protect investors, refused to unseal the premises. However, it directed SEBI to conclude its inquiry within six weeks, allowing the petitioners to challenge any adverse orders in appropriate forums.
Conclusion:
The court dismissed the writ petition, upholding the State's authority to seal the premises due to investor protection concerns and SEBI's findings of regulatory violations. The court directed SEBI to complete its inquiry promptly, allowing the petitioners to seek legal recourse against any adverse decisions.
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2013 (5) TMI 962
Issues Involved:
1. Jurisdiction of the Competition Commission of India (CCI) over Hockey India (HI) and the International Hockey Federation (FIH).
2. Definition of the relevant market.
3. Assessment of dominance in the relevant market.
4. Allegations of abuse of dominance by HI and FIH.
5. Allegations of anti-competitive agreements under Section 3 of the Competition Act.
Summary:
1. Jurisdiction of the Competition Commission of India (CCI) over HI and FIH:
The CCI determined that both HI and FIH qualify as "enterprises" u/s 2(h) of the Competition Act, 2002, despite their non-profit status. The economic activities carried out by HI and FIH, such as granting franchisee rights, media rights, and sponsorship rights, involve revenue generation and thus fall within the scope of the Act. The CCI also asserted its extra-territorial jurisdiction u/s 32 over FIH, which is based outside India, as its activities have an appreciable adverse effect on competition in India.
2. Definition of the Relevant Market:
The CCI defined two relevant markets:
- The market for the organization of private professional hockey leagues in India.
- The market for services of hockey players.
The CCI disagreed with the informants' and DG's definitions, emphasizing that governing activities cannot be part of market definition but can be a source of dominance.
3. Assessment of Dominance in the Relevant Market:
The CCI concluded that HI is dominant in both relevant markets due to its regulatory powers, monopoly position in team selection, and control over players through the Code of Conduct (CoC) Agreement. HI's dominance is also supported by the pyramid structure of sports governance, which creates entry barriers for other leagues and organizers.
4. Allegations of Abuse of Dominance by HI and FIH:
The CCI examined allegations of abuse of dominance, including:
- Foreclosure of market to rival leagues through regulations on sanctioned and unsanctioned events.
- Restrictive conditions in the CoC Agreement, such as requiring players to obtain NOCs and prohibiting participation in unsanctioned events.
The CCI found that the regulations and CoC Agreement are inherent and proportionate to the objectives of sports governance and do not constitute abuse of dominance per se. However, the manner of application of these regulations raised concerns about potential anti-competitive practices.
5. Allegations of Anti-Competitive Agreements under Section 3 of the Competition Act:
The CCI found that the CoC Agreement between HI and players is a vertical agreement but does not cause an appreciable adverse effect on competition. The CCI also concluded that the decision of FIH and HI regarding sanctioned and unsanctioned events does not violate Section 3(3)(b) of the Act, as it does not constitute a horizontal agreement.
Order:
The CCI did not find any contravention of Sections 3(3)(b), 3(4), 4(2)(a), 4(2)(c), and 4(2)(e) of the Act. However, it highlighted the potential conflict of interest between HI's regulatory and commercial roles and recommended that HI put in place an effective internal control system to ensure fair and transparent issuance of NOCs and avoid using regulatory powers for commercial gain.
Separate Judgment by R. Prasad (Dissenting):
R. Prasad dissented, finding that HI and FIH had indeed abused their dominant position and violated Sections 4(2)(a)(i), 4(2)(c), and 4(2)(e) of the Act. He recommended modifications to the CoC Agreement and FIH's byelaws to remove restrictions on players participating in unsanctioned events and imposed a penalty on HI and FIH.
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2013 (5) TMI 961
Issues involved: Appeal against order dated 11.10.2012 for Assessment Year 2009-10 u/s 263 of the Income Tax Act, 1961.
Grounds of Appeal:
1. CIT's decision on regular assessment order being erroneous and prejudicial to revenue.
2. Validity of regular assessment order dated 28.12.2011 u/s 263.
3. Exclusion of donation from income and expenditure account.
4. Nature of donation and exemption under section 10(23C)(iiiad).
5. Contrary order based on facts, law, and natural justice.
Facts of the Case:
- Assessee society engaged in education activities.
- CIT found assessment order erroneous and prejudicial to revenue.
- CIT issued show cause notice regarding society's claim under section 11/12.
- CIT held assessment order under section 143(3) erroneous and prejudicial to revenue.
Arguments:
- Assessee's engagement in educational activities and fee collection.
- Claim of exemption under section 10(23C)(iiiad) due to receipts below one crore.
- Registration under section 12A/12AA from A.Y. 2010-11.
- Reference to relevant Income & Expenditure Account and legal precedent.
Decision:
- Commissioner's power of suo motu revision under section 263.
- Order must be erroneous and prejudicial to revenue for revision.
- Definition of "erroneous" and criteria for invoking section 263.
- Commissioner's power not to substitute judgment of Income-tax Officer.
- CIT's view on gross receipt exceeding one crore not justifying revision.
- A.O.'s view supported by legal precedent, making order not erroneous.
- CIT's order set aside as not in accordance with law.
- Distinction of cited decisions on facts.
- Assessee's appeal allowed.
Conclusion: Assessee's appeal allowed against CIT's order under section 263 for Assessment Year 2009-10.
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2013 (5) TMI 960
Issues involved: Appeal against the order of ld. CIT(A) for A.Y. 2009-10, involving computation of book profits u/s 115JB and depreciation on computer peripherals.
Issue 1 - Computation of Book Profits u/s 115JB:
- The assessee company declared a loss in the relevant assessment year.
- AO completed the assessment u/s 115JB without deducting any carried forward unabsorbed depreciation or business loss.
- Ld. CIT(A) partly allowed the appeal in favor of the assessee, directing the AO to verify and allow the benefit of minimum of brought forward business loss or depreciation while computing the book profit u/s 115JB.
- Department appealed against this decision, questioning the allowance of business loss and depreciation.
- The contention was that the company was not entitled to carry forward business loss due to a change in shareholding pattern.
- Ld. Counsel argued that sec. 79 does not apply to the computation of book profits u/s 115JB.
- Tribunal found that the AO did not disallow the claim under sec. 79 but due to lack of details of business loss in the return.
- Tribunal directed the AO to re-compute the book profits after verifying the correct figures of brought forward business loss or depreciation.
Issue 2 - Depreciation on Computer Peripherals:
- AO disallowed 60% depreciation claimed by the assessee on UPS, allowing only 15%.
- Ld. CIT(A) relied on a Delhi High Court decision allowing 60% depreciation on computer peripherals.
- Tribunal dismissed the appeal on this ground, following the High Court decision.
Separate Judgment by Judges:
- No separate judgment delivered by the judges.
Conclusion:
- The appeal by the Department and cross objection by the assessee were dismissed.
- The order was pronounced on 31/05/2013.
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2013 (5) TMI 959
Issues involved: Winding up petition, bonafide defense, admitted liability, one time settlement, failure to pay, dispute on settlement amount, company's financial status, estoppel, lapsing of settlement offer, liability amount in Balance Sheet, compliance with settlement terms.
Summary:
The appeal challenged the Company Court's order admitting a winding up petition due to the appellant's lack of bonafide defense and unwillingness to pay the admitted liability. The respondents had provided a loan to the appellant, who defaulted due to setbacks in the State excise policy. Despite various settlement proposals, the appellant failed to make payments, leading to the winding up petition. The appellant disputed the settlement terms and failed to comply with offers, leading to the court appointing a Provisional Liquidator.
The Company Court found that the appellant's defense was not bona fide and that they were unwilling to pay the admitted liability. Despite multiple settlement proposals and opportunities, the appellant failed to make payments or reach a resolution with the respondents. The court dismissed the appeal, upholding the winding up petition and appointing a Provisional Liquidator for the appellant company.
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2013 (5) TMI 958
Issues Involved:1. De-registration of Aircraft by DGCA. 2. Violation of Customs Duty Exemption. 3. Powers of DGCA under Rule 30(6) of the Aircraft Rules, 1937. 4. Powers of DRI under Sections 110 and 111 of the Customs Act. 5. Compliance with Cape Town Convention. Summary:1. De-registration of Aircraft by DGCA:The present appeal arises out of a Writ Petition filed by Respondent No. 1 seeking a direction to Respondent No. 3 Director General Civil Aviation (DGCA) to de-register its Aircraft. The learned Single Judge allowed the Writ Petition and directed issuance of a Writ of Mandamus directing DGCA to de-register the aircraft in issue. 2. Violation of Customs Duty Exemption:Investigations revealed that the Aircraft was being used for purposes other than for what it had been imported, specifically by Mr. Lalit K. Modi for personal travel, violating the terms of the customs duty exemption. The Directorate of Revenue Intelligence (DRI) requested DGCA not to de-register the Aircraft until the investigations were complete. 3. Powers of DGCA under Rule 30(6) of the Aircraft Rules, 1937:Rule 30(6) of the Aircraft Rules, 1937, empowers DGCA to cancel the registration of an aircraft under specific conditions. DGCA's refusal to de-register the Aircraft was based on the communication from DRI regarding ongoing investigations. 4. Powers of DRI under Sections 110 and 111 of the Customs Act:The appellant contended that the Aircraft was flown out of the country to deprive statutory authorities of their rights under Sections 110 or 111 of the Customs Act. However, the court found no provisions in these sections obliging DGCA to comply with DRI's instructions while dealing with a de-registration request. 5. Compliance with Cape Town Convention:Respondent No. 1 argued that as per the Cape Town Convention, a signatory State is required to de-register an Aircraft on a request by the mortgagee or owner. The court noted that DGCA's enabling power under Rule 30(6) is coupled with a duty to exercise its powers when circumstances demand. Conclusion:The court agreed with the findings of the learned Single Judge that DRI's instructions are not mandatory for DGCA. However, DGCA should consider DRI's request while exercising its powers. The court modified the impugned order, directing DGCA to take a reasoned decision on the de-registration request in accordance with law, allowing Respondent Nos. 1 and 2 to make written submissions. The appellant-DRI is free to take appropriate steps regarding the alleged evasion of Customs duty.
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2013 (5) TMI 957
Issues involved: Confirmation of addition of compensation amount in revised return u/s 254.
Confirmation of addition of compensation amount in revised return:
The assessee disclosed an amount of Rs. 2,10,000/- as compensation from builders in her revised return after being asked by the AO. The AO completed the assessment based on this revised return. The assessee contended before the CIT(A) that the amount is not taxable as it is a capital receipt, not related to business income. The CIT(A) upheld the AO's decision. The assessee cited Supreme Court judgments to support her argument. The Tribunal found that the assessee had the right to challenge the issue before the appellate authority if it is a legal one. Referring to the Supreme Court's decision in a similar case, the Tribunal held that the compensation received was capital in nature and not taxable. Therefore, the addition made by the lower authorities was deleted, and the appeal of the assessee was allowed.
Significant legal points:
- The Tribunal has jurisdiction to examine legal questions affecting tax liability, even if not raised before lower authorities.
- Compensation received for delay in possession of a capital asset is considered a capital receipt and not taxable as revenue.
- The assessee's right to challenge a legal issue before the appellate authority is upheld by the Supreme Court.
- The Tribunal can consider questions of law arising in assessment proceedings, even if not raised earlier.
Conclusion:
The Tribunal allowed the appeal of the assessee, deleting the addition of compensation amount in the revised return, as it was deemed capital in nature and not liable to tax based on legal precedents and the nature of the receipt.
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