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Case Laws
Showing 141 to 160 of 655 Records
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2005 (7) TMI 591 - CESTAT, MUMBAI
Confiscation and penalty - Clandestine removal - Proof of ... ... ... ... ..... hat such shortages were on account of the fact that whereas the goods are accounted in records on formula basis, but clearances of the goods is accounted by actually weighing the goods. This practice is followed in all steel industries and quantum of shortages and excess are within the permissible limit of 1 , in view of the Board rsquo s Circular No. 52/79-CX.6, dated 26-10-1979. I find force in the above plea of the appellants. Apart from the fact that the shortages are within the permissible limit, it is also noticed that there is no other evidence reflecting upon the clandestine removal of the goods in question. Even the statements of the appellants recorded at the time of visit were not inculpatory. As such, I am of the view that the demands of duty, confiscation of the material and imposition of penalty upon the appellants is not justified. The impugned order is accordingly set aside and the appeal allowed with consequential relief to the appellants. (Dictated in Court)
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2005 (7) TMI 590 - CESTAT, MUMBAI
Exemption subject to end use - Flywheels manufactured by appellant ... ... ... ... ..... be subjected to verification. Having not done so the original authority should not have rejected the evidence produced. 4. emsp The Commissioner decided the issue before him on a very short point and that is, the manufacturer of flywheels were not registered with the Central Excise authorities and therefore the goods produced by him will attract duty even when they are used in the manufacture of Diesel Oil Engines. This cannot be upheld in view of the decision of the Hon rsquo ble Supreme Court in the case of Thermax cited supra. It would have been entirely different had the end user was not registered with the Central Excise authorities. In these circumstances we hold that the parts manufactured on a job-work basis were ultimately used in the manufacture of Diesel Oil Engines and are therefore eligible for the benefit of exemption Notification No. 217/85. 6. emsp The appeal is allowed the order of the Commissioner (Appeals) is set aside. (Operative part pronounced in court)
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2005 (7) TMI 589 - CESTAT, MUMBAI
... ...
... ... ..... y imposed upon the appellants. 4. emsp Countering the argument, Shri N.V.B. Nair, J.D.R., states that in terms of the provisions of Rule 8 of the Central Excise Rules, 2001, inability to clear the consignments by debiting duty in PLA shall be deemed as if such goods have been cleared without payment of duty and the consequence of penalties as provided in these rules shall follow. 5. emsp After considering the submissions made by both sides, I find that in terms of provisions of Rule 8, clearance of goods by debiting the Cenvat account during the period of forfeiture facility to pay in fortnightly instalments has to be treated as if the clearances have been affected without payment of duty and penal provisions have to be invoked. However, keeping in view the appellants conduct of depositing the amount in PLA, subsequently, I reduce the penalty amount from Rs. 2,00,000/- to Rs. 20,000/-. But for the above modification in the quantum of penalty, the appeal is otherwise rejected.
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2005 (7) TMI 588 - CESTAT, MUMBAI
Cotton bleached fabrics ... ... ... ... ..... C.) and these tests are not complied to call for coating test to pass Since the padding solution and stiffness imported to the fabrics, in this case, is not even seem to be permanent much less irreversible, therefore, the benefit of notification should be granted as claimed. (d) Allegation of screen printing is not alleged in SCN and finding on that is beyond the notice and cannot be upheld. 3. emsp After considering the facts as herein above, we find no reasons to uphold the process to be that of rsquo coating rsquo . The tests results, as relied upon by the Commissioner and extracted herein above would indicate that the surface is not uniformly and evenly coated, there are gaps leaving the fabrics to be not imperious, one of the tests for a coating. We find no reason not to find the application of the special mixture, in this case, to be a padding process and eligible to benefit of the notification. The order is therefore set aside and appeals allowed. (Pronounced in Court)
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2005 (7) TMI 587 - CESTAT, MUMBAI
Aluminium foil - Classification of ... ... ... ... ..... t the issue is well settled by the Hon rsquo ble Supreme Court reported in 2003 (157) E.L.T. A35 holding that ldquo Since the Revenue has accepted the judgment of the Customs, Excise and Gold (Control) Appellate Tribunal in Commissioner of Central Excise, Calcutta v. Indian Foil Ltd. 2001 (132) E.L.T. 737 (Tri.) 2000 (39) RLT 304 and that the judgment has been followed in the case by Tribunal, the civil appeal is dismissed. rdquo 7. emsp The Tribunal in that decision held that Aluminium Foil Backed on one side with printed polyester and with HDPE foil on the other side is classifiable under sub-heading 7607.60 of the CETA, 1985 and not under Heading 39.20. 8. emsp The aforesaid position has been accepted by the Board vide its Circular No. 753/69/2003-CX., dated 6-10-2003. 9. emsp Following the settled position, we hold that the classification of such plastic laminated aluminium foil is to be upheld under Heading 7607.60 of the CETA,1985 and consequently the appeal is allowed.
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2005 (7) TMI 586 - CESTAT, MUMBAI
Demand and penalty ... ... ... ... ..... the original to sound condition and remake to do a new thing over again from original material see. Hindustan Motors Ltd. - 1992 (62) E.L.T. 66 at 71 approving the definition in the Dictionary. Applying the same, we find no reason to deny the coverage of the present appellant rsquo s activity to be under rule 173H since separate reprocessing of such material is not necessary. The present case has inappropriately been terms as replacement. 2.3 emsp In view of the two members decisions of this Tribunal in J.G. Glass Ltd. - 1988 (37) E.L.T. 248 and Hindustan Motors Ltd. - 1992 (62) E.L.T. 66, the Single Member decision in a case of soap cake repairs by the Ld Commissioner was not called for as that decision had been arrived without considering these two member decisions. 2.4. emsp When duty demands could not be made, there is no cause for penalty under rule 173Q. 3.1 emsp In view of the findings above, the order is set aside and appeal allowed. (Pronounced in Court on 7-7-2005)
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2005 (7) TMI 585 - ITAT MUMBAI
Income from house property ... ... ... ... ..... Government of India. The lease deed also provides that Government of India will pay the monthly rent. It is clear from the provisions of sub-section 27(iiib) and 269UA(f) that where the period of lease is more than 12 years, lessee deemed to be the owner of the property for the purpose of assessment under the Act. Admittedly, in the case before us, the period of lease is of 5 years, which is less than 12 years. 11. In view of the foregoing, keeping in view the totality of the facts and circumstances of the case, in our humble view, the assessee continued to be the owner of the property in question for the purpose of section 22. Therefore, rental income is rightly assessed by the Assessing Officer under the head Income from house property . For this reliance can be placed on the decision of the Hon rsquo ble Supreme Court in the case of Sambhu Investments (P.) Ltd. v. CIT 2003 263 ITR 143. We, therefore, decline to interfere. 12. In the result, both the appeals are dismissed.
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2005 (7) TMI 584 - ITAT CHENNAI
Deductions - Profits and gains from industrial undertakings, etc., after certain dates ... ... ... ... ..... elied on cannot be taken for consideration. In view of this, we hold that the CIT, is justified in invoking the provisions of section 263 and directing the Assessing Officer to re-compute the deduction under section 80-I, after considering section 80-I(6) of the Income-tax Act. We also hold that the CIT, was right in treating the order passed by the Assessing Officer as erroneous and prejudicial to the interest of the Revenue. 7. It is also a matter of record that the assessee has settled the issue on similar grounds relating to the assessment year 1994-95 under K.V.S. Scheme, which is part of the same revisionary order passed by the CIT. This goes to prove that the assessee has accepted the action of the CIT in invoking the provisions of section 263. Hence, the assessee cannot have duel standards, which is not appreciated. Accordingly, we confirm the order of the CIT and reject the ground taken by the assessee. 8. In the result, the appeal filed by the assessee is dismissed.
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2005 (7) TMI 583 - ITAT MUMBAI
Capital gains -Profit on sale of property used for residential house ... ... ... ... ..... sed for commercial purpose for sometime, but it does not change the character of the house property in view of the reasoning that no depreciation had been claimed thereon in the past and the society rsquo s secretary had certified the same as being a residential house property all along. Both these units jointed together by a common entrance and inter-linked stair-case, the house property had to be considered as one only. The said property was acquired on 24-10-1986 and sold on 24-2-1994 - both dates had been verified from the records of the Housing Society and the same was accepted by the Assessing Officer. Accordingly, the CIT(A) has rightly directed the Assessing Officer to allow such indexation of the cost of the original asset sold and to allow deduction under section 54(1) of the Income-tax Act, 1961, with regard to the Long Term Capital Gain reinvested in purchase of the new asset being residential house property. 4. As a result, the appeal of the Revenue is dismissed.
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2005 (7) TMI 582 - ITAT CHENNAI
Depreciation, Investment deposit account, Business income ... ... ... ... ..... eover, in view of the judgment of the Supreme Court in the case of Kedarnath Jute Mfg. Co. Ltd. v. CIT 1971 82 ITR 363 and in the case of Polyflex (India) (P.) Ltd. v. CIT 2002 257 ITR 343, the amount collected by the assessee to meet the sales tax liability has to be treated as trading receipt. Therefore, in our considered opinion, the judgment of the Madras High Court in the case of South India Sugars Ltd. (supra) may not be applicable to the facts of the case. 25. In view of the above discussion, in our opinion, the judgment of the Madras High Court in the case of Southern Explosives Co. (supra) and judgment of the Supreme Court in the case of Chowringhee Sales Bureau (P.) Ltd. (supra) would be squarely applicable to the facts of the present case. Accordingly, we set aside the order of the CIT(A) and restore that of the Assessing Officer. 26. In the result, the Revenue rsquo s appeal in I.T.A. No. 1341(Mad.)/97 is partly allowed. However, there will be no order as to cost.
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2005 (7) TMI 581 - ITAT CHENNAI
Interest levied u/s 201(1A) - Non deduction of tax at source either u/s 194-I landing and parking charges Or u/s 194J in respect of navigational charges - Assessee-in-default - HELD THAT:- After considering the entire factual situation in the case of landing and parking of aircraft in the airport, a co-ordinate Bench of this Tribunal in the case of Japan Airlines [2004 (10) TMI 281 - ITAT DELHI-B], came to a conclusion that the International Airport Authority of India never intended to give out exclusive possession of any part of the landed property in relation to landing and parking area. Since the International Airport Authority of India granted permission for landing and parking without providing any exclusive right or interest in any specific portion of the land, the payment made by airline company cannot be construed as payment of rent. Therefore, the co-ordinate Bench of this Tribunal came to the conclusion that section 194-I is not applicable with regard to payment of landing and parking charges. However, the Delhi Bench of this Tribunal found that the payment attracts the provisions of section 194C since there was a contract between the assessee-company and the International Airport Authority of India.
Therefore, the assessee is liable to deduct tax at the rate of 2%. By following the decision of Delhi Bench of this Tribunal in the case of Japan Airlines (supra) and for the very same reasons stated therein, we hold that the payment of landing and parking charges cannot be termed as payment of rent. Therefore, the provisions of section 194-I is not attract. As held by the Delhi Bench of this Tribunal, the payment attracts the provisions of section 194C. Therefore, the assessee is liable to deduct tax at the rate of 2%.
Navigational facilities - In view of the clarification made by the learned counsel for the assessee that the assessee was in fact getting technical services apart from using the equipments for the purpose of communication between the aircraft and the air traffic controller, in our opinion, the provisions of section 194J would be applicable. Accordingly the assessee ought to have deducted tax as provided u/s 194J in respect of payment made for navigational facility.
Application of section 201(1) and 201(1A) - Since the recipient company, admittedly, paid the tax, in our opinion, any further recovery from assessee would amount to double taxation which is not permissible under the Act. Accordingly, we hold that there is no justification to treat the assessee as assessee-in-default. When the Assessing Officer himself revised the order by making a rectification u/s 154, in our opinion, there is no justification on the part of the first Appellate Authority to restore the original order with respect to section 201(1).
Levy of interest - Following the Gujarat High Court in the case of Rishikesh Apartments Co-operative Housing Society Ltd. [2001 (6) TMI 17 - GUJARAT HIGH COURT], we do not find any justification for levying tax till the month of October 1999. Since the actual date of payment of tax by the International Airport Authority of India is not available on the file of this Tribunal, the Assessing Officer may verify the actual date on which the taxes were paid by International Airport Authority of India and thereafter compute the interest from the date on which the deduction has to be made till the date of actual payment at the rate applicable as per the statutory provision.
In the result, the order of the lower authority is set aside with regard to treating the assessee as assessee-in-default u/s 201(1) and levying interest u/s 201(1A). The Assessing Officer shall recompute the interest on the amount of tax as per the order of this Tribunal from the date on which deduction has to be made till the date of actual payment of tax by International Airport Authority of India after giving sufficient opportunity to the assessee in accordance with law.
In the result, all the appeals filed by the assessee are partly allowed. However, there will be no order as to cost.
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2005 (7) TMI 580 - ITAT MUMBAI
Block assessment in search cases ... ... ... ... ..... ons and assessed in block assessment were disclosed in the returns which was subject-matter of the regular assessment, such transactions could not be considered in the block assessment. Thus, it is amply clear that the items considered by the revenue in the grounds of appeal do not fall for consideration under Chapter XIV-B as they are the subject-matter of regular assessment. No evidence either direct or prima facie was found in the search. Entire addition is based on post-search enquiries independently carried out by the Assessing Officer. Such enquiries had no nexus with the search. There was no evidence found in the search relating to these two items, which could have provoked Assessing Officer to carry out further enquiries to support the evidence discovered in the search. Thus, these items of additions of undisclosed income do not fall in the domain of Chapter XIV-B. In view of this both grounds of revenue fail. 10. In the result, the appeal of the revenue is dismissed.
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2005 (7) TMI 579 - ITAT COCHIN
Income escaping assessment ... ... ... ... ..... ed by the Assessing Officer at the time of the original assessments framed under section 143(3). Hence, we find no infirmity in the order of the CIT(Appeals) and no interference is called for. Hence, we uphold and confirm the order of the CIT(A). As far as the other issue is concerned, the CIT(A) has cancelled the assessments of the assessee on the issue of legality of the initiation of reassessment proceedings and as we are confirming the order of the CIT(A), the other issue raised by the revenue does not survive. 13. In the result, the appeals filed by the revenue are dismissed. Order accordingly. 14. CO Nos. 20 and 21/Coch./2003. The assessee has filed the two Cross- objections, raising as many as six grounds. The ld. AR submitted that he is not pressing the cross-objections in case the order of the CIT(Appeals) is confirmed on the issue of jurisdiction. As the order of the CIT(A) is confirmed on the issue of jurisdiction, the cross-objections are dismissed as not pressed.
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2005 (7) TMI 578 - ITAT MUMBAI
... ...
... ... ..... case of Shree Nivas Chemicals (supra) is concerned, that is not on the point adjudicated by us. In that case, the only question related to the date of initiation of penalty proceedings. The Bench held that penalty proceedings could be said to be initiated on the date when notice was issued and, therefore, period of limitation for passing of order would be from the end of the month in which notice was issued. Therefore, that case is distinguishable and does not help the revenue. 13. In the present case, the returned income was processed under section 143(1) vide intimation dated 7-10-1994 and admittedly no proceeding related to assessment year 1995-96 was pending on 1-2-1999 when penalty notice under section 271D was issued. Hence, initiation of penalty proceedings was bad in law. The impugned order of the learned CIT (Appeals) is, therefore, quashed and the penalty proceedings initiated by Assessing Officer are cancelled. 14. In the result, appeal of the assessee is allowed.
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2005 (7) TMI 577 - ITAT MUMBAI
Interest on borrowed capital, Deductions - Profits and gains from newly established small scale industrial undertakings
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2005 (7) TMI 576 - ITAT MUMBAI
Determination of annual value of the property - cost of acquisition of the flat - Business income Or Income from house property - Loans and advances - disallowance u/s 40A(2).
HELD THAT:- For the purpose of determining the annual value of the property recourse is to be made to section 23. The provisions and the applicability of the Bombay Municipal Corporation Act and the determination of rateable value has been elaborately considered by their Lordships of Calcutta High Court in the case of Prabhavati Bansali [1981 (9) TMI 21 - CALCUTTA HIGH COURT] wherein the provisions of Bombay Municipal Corporation Act has been deliberated upon as the property in question is situated in Mumbai and it has been held that for determining the annual value of the property reference is to be made to the rateable value as determined by the Municipal Corporation. Their Lordships of Hon’ble Bombay High Court in the case of M.V. Sonawala [1988 (12) TMI 82 - BOMBAY HIGH COURT], following decision of Hon’ble Calcutta High Court and also Hon’ble Supreme Court in the case of Dewan Daulat Rai Kapoor v. New Delhi Municipal Committee[1979 (12) TMI 3 - SUPREME COURT] and Dr. Balbir Singh v. M.C.D.[1984 (12) TMI 64 - SUPREME COURT] held that :"the income from house property has to be computed on the basis of the sum for which the property might reasonably be let from year to year or the annual municipal rateable value."
Thus, we agree that for determining the annual value of property, the adoption of Municipal Rateable Value is the correct method and in cases where the actual rent received is higher than the Municipal Rateable Value, the rent so received is to be adopted as Annual Letting Value of the property. In the circumstances we direct the Assessing Officer to verify the annual rateable value of the flat as per the Bombay Municipal Corporation Act and adopt the annual letting value of the said flat being the actual rent received by the assessee or the Municipal Rateable Value whichever is higher.
This ground of appeal raised by the revenue for the assessment years 1991-92, 1992-93 and 1993-94 stands rejected.
Loans and advances - disallowance u/s 40A(2) - There is direct nexus between the borrowings made at higher rate of interest and advanced at lower rate of interest has not been established during the assessment proceedings. Similarly the fact that certain borrowings were made at the rate of 30 per cent and also advanced at the same rate has not been verified by the Assessing Officer. Therefore, in the light of principles of natural justice we deem it fit to restore the matter to the file of the Assessing Officer to verify the contentions of the assessee w.r.t. borrowings and advances made during the year under consideration.
In case of establishment of direct nexus between the borrowings at higher rate of interest and advances at lower rate of interest the proportionate interest is to be disallowed. In case the borrowings and advances bear the same rate of interest or the advances are not out of such borrowings at high rate of interest, no interest is to be disallowed and the same may be verified by the Assessing Officer after affording a fair and proper opportunity to the assessee. Therefore, this ground of appeal of the revenue is allowed.
In the result, the appeal for assessment year 1991-92 is dismissed and that of assessment years 1992-93 and 1993-94 is partly allowed.
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2005 (7) TMI 575 - ITAT MUMBAI
Concept of real income ... ... ... ... ..... igh Court. The facts in the present case are similar to the above-mentioned case. The Board of Directors have taken a conscious decision that fee chargeable from the AMC should be waived. Otherwise the expenses could have been incurred more. Therefore, the fee which never charged by the assessee, cannot be held as income of the assessee for the year under consideration and the CIT(A) was justified in deleting the same. We further note that similar addition has been deleted by the CIT(A) for the assessment year 1997-98. The CIT(A) also relied on the Board rsquo s Circular No. 26(XLVII-5) dated 26-10-1953, which permits such surrender in specified circumstances and the facts were quite similar to the present case. Therefore, in view of the Circular considered by the CIT(A) for the assessment year 1997-98 and in view of reasoning given by the CIT(A) and above reasoning of ours, we confirm the order of the CIT(A). 5. In the result, the appeal filed by the Department is dismissed.
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2005 (7) TMI 574 - ITAT BANGALORE
Adventure in nature of trade ... ... ... ... ..... ept to sell his land for his family livelihood. This cannot be termed as business or adventure in the nature of trade. Further it is to be seen that if the land is sold in one big piece, the assessee may get only a small sum. On the other hand, if the land is developed and sold, he may get some enhanced price so that his family can live in peaceful manner. Merely because the land was plotted out and sold, it cannot be said that the transaction is adventure in the nature of trade and business. The authorities below misconceived the facts. In our view, the transaction that has been done by the assessee cannot be considered to be a business but it is only an attempt for livelihood for himself and his family. Therefore, we do not find any justification in treating the income in this issue as that of business. Therefore, we direct the Assessing Officer to accept the return filed by the assessee. It is ordered accordingly. In the result, the appeal filed by the assessee is allowed.
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2005 (7) TMI 573 - ITAT MUMBAI
Penalty - For concealment of income ... ... ... ... ..... on, which was not substantiated (2) he fails to prove that such Explanation is bona fide (3) all the facts relating to the same and material to the computation of total income has been disclosed by him. Here, the assessee has offered an Explanation, all the facts relating to computation of income are on record and in fact, they were disclosed by the assessee and the Explanation of the assessee is bona fide in the sense that labour unrest and disruption has been accepted by the Settlement Commission and he himself offered the sum for taxation, when mistake was discovered by them. We also find that the Tribunal in assessee rsquo s own case confirmed the cancellation of penalty in respect of other two amounts made on similar grounds. Thus, we do not find any justification in confirming the penalty. Hence, the order of CIT(A) is reversed and penalty for concealment in respect of the sum of Rs. 1,73,126 is hereby cancelled. 14. In the result, the appeal of the assessee is allowed.
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2005 (7) TMI 572 - ITAT MUMBAI
Deductions - Profits and gains from infrastructure undertaking ... ... ... ... ..... explanation is not fully convincing, yet it is plausible. Considering the fact that the assessee had sold at a lesser price, as compared to other parties, and that the purchases made by other parties, from another supplier, were quite substantial and also considering that no attempt has been made as to ascertain the exact profit rate or the sale price from similar parties, i.e., Hindustan Latex, we are of the view that the conclusion arrived at by the Assessing Officer, is not justified. The decision of the Tribunal, in the case of PCA Engineers Ltd. ( supra), supports this view. In this case, the Tribunal was considering in detail section 80HH and also similar clause 80HH(7) which is identical to clause 80-IA(10). In the light of the above facts, the appeal of the assessee on this ground stands allowed. 25. to 33. These paras are not reproduced here. As they involve minor issues. 34. In the result, the appeal of the Revenue is dismissed and appeal of the assessee is allowed.
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