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2002 (8) TMI 854
Issues involved:
- Denial of deemed Modvat credit on inputs supplied by manufacturers of hot re-rolled iron and steel products under certain invoices.
Detailed Analysis:
1. The appellants were denied deemed Modvat credit by lower authorities based on the ground that the input-manufacturers did not declare the duty-paid nature of the inputs in the invoices. The appellants argued that they were entitled to the credit as per Notification No. 58/97-CE and cited precedents supporting their claim, including a decision in Delhi Steel Industries vs. CCE, Chandigarh 2002 (48) RLT 753. They also referred to Final Order No. 326/02/NB(DB) in M/s. Shivaye Industries vs. CCE, Chandigarh, which highlighted that no certificate from the Range Supdt. of Central Excise certifying duty-paid nature of inputs was required under the said Notification.
2. The Departmental Representative (DR) contended that other Single-Member Benches had taken a different view on the matter, but failed to provide any contrary decision. Upon examination, it was revealed that some invoices declared "duty liability discharged under Rule 96ZP (3)", while others mentioned "duty liability to be discharged under Rule 96ZP(3)" or "goods cleared under Rule 96ZP". The Tribunal referred to the Central Government's declaration in para 2 of the Notification, stating that the duty of excise on the inputs shall be deemed to have been paid, and any further declaration by the input-supplier was unnecessary.
3. The Tribunal emphasized that the declaration-related condition in para-4 of the Notification, requiring input-manufacturers' invoices to declare the appropriate duty of excise paid on the inputs, should not contradict the substantive provisions of the Notification. It was noted that the substantial provisions of deemed Modvat credit were in paras 1, 2, and 3 of the Notification, with para-2 containing the Central Government's declaration of deemed duty payment on inputs. The Tribunal concluded that denial of deemed Modvat credit based on the absence of input-manufacturers' declaration in para-4 would be contradictory to the Government's declaration in para-2.
4. Ultimately, the Tribunal found that the appellants had complied with the substantive requirements of Notification No. 58/97-CE, and were entitled to take the deemed Modvat credit based on the invoices in question. As a result, the appeal was allowed, and the appellants were granted the credit they sought.
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2002 (8) TMI 853
Issues Involved:
The judgment involves issues related to the rejection of accounts under section 145(2), estimation of net profit on contract receipts, addition to disclosed net profits, levy of interest under section 234-B, and correct credit of TDS.
Rejection of Accounts under Section 145(2):
The Assessing Officer rejected the book results of the assessee under section 145(2) due to various reasons such as incomplete details in labour expenses, unverifiable revenue receipts, and lack of proper vouchers for expenses. The net income was estimated at 12.5%, resulting in an addition of &8377; 523905. The CIT(A) upheld this decision based on the range of net profits in government contracts. However, the Tribunal found that the rejection of accounts should be based on more than mere allegations, especially when the accounts were regularly maintained, audited, and previous years' results were consistent. The Tribunal concluded that the addition made by the lower authorities was unjustified, and hence, the addition was deleted.
Estimation of Net Profit on Contract Receipts:
The assessee's net profit ratio on contract receipts had increased over the years, and the claimed net profit rate for the assessment year was 10.13%. The lower authorities estimated the net profit at 12.5%, which the Tribunal deemed as a generalized observation without specific evidence. The Tribunal emphasized the need for a valid basis for rejecting accounts under section 145(2) and found no justification for estimating the profit at a higher rate. Consequently, the addition of &8377; 523905 was deleted.
Addition to Disclosed Net Profits:
The addition of &8377; 523905 to the disclosed net profits was based on the Assessing Officer's estimation of net income at 12.5%. The CIT(A) upheld this addition, citing the range of net profits in government contracts. However, the Tribunal found the basis for rejection of accounts insufficient and concluded that the addition was unwarranted. Therefore, the addition was deleted in favor of the assessee.
Levy of Interest under Section 234-B:
The assessee was also aggrieved by the levy of interest under section 234-B, which was sustained by the lower authorities. However, since the Tribunal found the additions to be unjustified and deleted them, the ground related to the levy of interest was not independently adjudicated. The consequential nature of this ground led to no further adjudication.
Correct Credit of TDS:
The grievance of the assessee regarding the correct credit of TDS was set aside by the lower authorities. However, the assessee did not press this ground during the appeal, leading to its dismissal as withdrawn. Consequently, this ground did not undergo detailed adjudication.
Conclusion:
The Tribunal allowed the appeal in favor of the assessee, deleting the addition of &8377; 523905 and overturning the decisions related to the rejection of accounts under section 145(2) and the estimation of net profit on contract receipts. The levy of interest under section 234-B was not independently adjudicated due to the consequential nature of the decision.
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2002 (8) TMI 852
Issues Involved:
The issue involves the interpretation of section 68 of the Income Tax Act regarding the addition made under this section in relation to share application money.
Judgment Details:
1. The Tribunal referred a question of law to the High Court regarding the deletion of an addition made under section 68 of the IT Act by the CIT(A), citing a decision of the Delhi High Court in CIT v. Stellar Investments Ltd. The Tribunal and CIT(A) relied on this decision, but it was later overruled by a Full Bench of the Delhi High Court in CIT v. Sophia Finance Ltd., which clarified that section 68 is indeed applicable to share application money. The burden of proving the genuineness of the entries lies with the assessee.
2. The High Court held that the earlier decision of the Delhi High Court in CIT v. Stellar Investments Ltd. was overruled by a subsequent Full Bench decision in CIT v. Sophia Finance Ltd., establishing that section 68 of the IT Act is applicable to share application money. The Court ruled against the assessee and in favor of the Revenue, emphasizing that the genuineness of the entries related to share application money is a factual matter to be determined by the assessing authority based on the evidence on record.
3. The High Court answered the reference in the negative, indicating that the addition made under section 68 of the IT Act was justified. The Court highlighted that the genuineness of the entries concerning share application money is a factual issue to be decided by the assessing authority based on the available evidence. No costs were awarded in this matter.
This judgment clarifies the legal position regarding the applicability of section 68 of the IT Act to share application money and emphasizes the burden of proving the genuineness of such entries on the assessee.
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2002 (8) TMI 851
Issues involved: Conviction u/s 16 read with Section 7 for violation of Prevention of Food Adulteration Act, 1954; Commutation of sentence u/s 433 (d) of the Criminal Procedure Code.
The respondent was convicted for violating the Prevention of Food Adulteration Act and sentenced to one year of simple imprisonment and a fine. The Appellate Judge affirmed the conviction but found it not possible to grant relief under Section 433 (d) of the Cr.P.C. The High Court, considering the certificate from the Central Food Laboratory and a previous court direction, extended the benefit of commutation of sentence to the respondent, ordering a fine deposit of Rs. 20,000 for suspension of the imprisonment sentence. The Delhi Administration appealed against this decision, arguing that the High Court exceeded its jurisdiction by ordering commutation without error in the imposed sentence. The respondent's counsel argued that since the adulteration was not harmful, the High Court's decision was justified, citing previous court cases and the respondent's compliance with the fine deposit.
The Supreme Court found that the High Court exceeded its jurisdiction by ordering commutation of the sentence under Section 433 of the Cr.P.C., which is the prerogative of the appropriate Government. The Court emphasized that the power to commute a sentence should be exercised by the Government in accordance with established principles and not at its own discretion. The Court clarified that the High Court's order directing commutation and fine deposit was not legally sustainable and set it aside. However, the Court acknowledged that the misunderstanding may have arisen due to previous judgments and allowed the benefit already given to the accused in this case. The Court advised the Government to grant relief to the accused if deemed appropriate, or seek modification of orders through the legal process. The appeal was allowed to clarify the legal position and provide further directions.
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2002 (8) TMI 850
Issues Involved:
1. Addition to closing stock on account of MODVAT credit.
2. Disallowance of rural development expenses.
3. Disallowance of rent paid for guest-house.
4. Disallowance of expenditure on presentation articles.
5. Disallowance of entertainment expenditure on employees.
6. Disallowance of project expenses written off.
7. Disallowance of expenditure pertaining to the previous assessment year.
8. Disallowance of investment allowance on data processing equipment.
9. Inclusion of excise duty and sales tax in total turnover for computing deduction u/s 80HHC.
10. Apportionment of expenditure towards dividend income for deduction u/s 80M.
11. Exclusion of 'other income' from profits for computing deduction u/s 80HH.
12. Deduction of losses of specific units from profits of other units for computing deduction u/s 80HH.
13. Deduction u/s 80HH before deducting investment allowance and higher depreciation.
14. Deduction u/s 80-I for a specific unit.
15. Exclusion of 'other income' from profits for computing deduction u/s 80-I.
16. Deduction u/s 80-I before deducting investment allowance and higher depreciation.
17. Grant of interest u/s 244A on refund.
18. Deduction of expenditure pertaining to a previous assessment year.
Summary:
1. Addition to Closing Stock on Account of MODVAT Credit:
The ground was not pressed during the hearing and was accordingly dismissed.
2. Disallowance of Rural Development Expenses:
The CIT(A) upheld the disallowance of Rs. 2,15,000 for rural development expenses, citing the withdrawal of s. 35CC. However, the Tribunal allowed the deduction u/s 37(1), noting the expenses had a direct nexus with the business purpose of the assessee.
3. Disallowance of Rent Paid for Guest-House:
The Tribunal dismissed the ground, aligning with previous decisions that such expenses are not deductible under s. 37(4).
4. Disallowance of Expenditure on Presentation Articles:
The Tribunal allowed the ground, referencing past decisions in the assessee's favor and the Bombay High Court's ruling in CIT vs. Allana Sons Pvt. Ltd.
5. Disallowance of Entertainment Expenditure on Employees:
The Tribunal directed the AO to allow 1/3rd of the expenditure as incurred on employees, following previous Tribunal orders and High Court judgments.
6. Disallowance of Project Expenses Written Off:
The Tribunal allowed the deduction of Rs. 33,19,600, recognizing the projects as extensions of existing business and thus constituting a revenue loss.
7. Disallowance of Expenditure Pertaining to Previous Assessment Year:
The ground was not pressed during the hearing and was accordingly dismissed.
8. Disallowance of Investment Allowance on Data Processing Equipment:
The Tribunal allowed the ground, consistent with previous Tribunal orders in the assessee's favor.
9. Inclusion of Excise Duty and Sales Tax in Total Turnover for Computing Deduction u/s 80HHC:
The Tribunal ruled in favor of the assessee regarding excise duty and sales tax, citing the Bombay High Court decision in CIT vs. Sudarshan Chemicals Inds. Ltd. The issue of 'other income' was remanded to the AO for re-adjudication.
10. Apportionment of Expenditure Towards Dividend Income for Deduction u/s 80M:
The ground was not pressed during the hearing and was accordingly dismissed.
11. Exclusion of 'Other Income' from Profits for Computing Deduction u/s 80HH:
The Tribunal ruled in favor of the assessee, following previous Tribunal orders.
12. Deduction of Losses of Specific Units from Profits of Other Units for Computing Deduction u/s 80HH:
The Tribunal ruled in favor of the assessee, consistent with previous Tribunal decisions.
13. Deduction u/s 80HH Before Deducting Investment Allowance and Higher Depreciation:
The Tribunal decided this issue in favor of the Revenue, following its previous decision.
14. Deduction u/s 80-I for a Specific Unit:
The Tribunal dismissed the ground on technical grounds due to the loss in the current year, despite recognizing the unit's eligibility for deduction.
15. Exclusion of 'Other Income' from Profits for Computing Deduction u/s 80-I:
The Tribunal ruled in favor of the assessee, following consistent past decisions.
16. Deduction u/s 80-I Before Deducting Investment Allowance and Higher Depreciation:
The Tribunal dismissed the ground, following its previous decision against the assessee.
17. Grant of Interest u/s 244A on Refund:
The ground was not
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2002 (8) TMI 849
Case: Supreme Court Citation: 2002 (8) TMI 849 - SC Order
Judges: N. Santosh Hegde and Bisheshwar Prasad Singh, JJ.
Decision: Delay condoned. Appeal dismissed on merits.
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2002 (8) TMI 848
The judgment concerns a case where applicants sought to alter a charge under Section 307/34, I.P.C. to 324/34 I.P.C., but the request was rejected as the charge cannot be deleted. The court clarified that alteration of charge does not include deletion, and the application was deemed misconceived. The petition was dismissed.
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2002 (8) TMI 847
Issues Involved:
1. Validity of the Government Orders (G.O.Ms. Nos. 128, 129, and 130) issued by the State of Tamil Nadu.
2. Right to renewal of licenses for existing licensees.
3. Reasonableness and arbitrariness of the new excise policy.
4. Application of the doctrine of promissory estoppel and legitimate expectation.
5. Consequences of the non-lifting of the minimum off-take of liquor.
Issue-wise Detailed Analysis:
1. Validity of the Government Orders (G.O.Ms. Nos. 128, 129, and 130):
The Government of Tamil Nadu issued G.O.Ms. Nos. 128, 129, and 130 to increase the number of retail vending shops, re-categorize shops, and enhance the privilege amount to augment excise revenue. The High Court upheld the government orders related to fiscal policy and revenue augmentation but invalidated the provisions abolishing the renewal of existing licenses, deeming them arbitrary and unrelated to revenue augmentation.
2. Right to Renewal of Licenses for Existing Licensees:
The High Court found that the policy change to abolish renewal rights for existing licensees was arbitrary and unreasonable, as it had no nexus with the objective of revenue augmentation. The Supreme Court affirmed this view, stating that the existing licensees could not be deprived of renewal rights as per the excise policy for the block period 2001-2004, reflected in G.O.Ms. No. 115. The Court directed the competent authority to consider renewal applications per the rules and conditions, including the minimum off-take requirement.
3. Reasonableness and Arbitrariness of the New Excise Policy:
The High Court and the Supreme Court both scrutinized the reasonableness of the new excise policy. The policy was deemed reasonable concerning fiscal measures like increasing the number of shops and re-categorizing them. However, the abolition of renewal rights was found to be arbitrary and whimsical, lacking any connection to the stated objective of revenue augmentation.
4. Application of the Doctrine of Promissory Estoppel and Legitimate Expectation:
The High Court rejected the applicability of the doctrines of promissory estoppel and legitimate expectation, stating that the trade in intoxicating liquor is not a right but a privilege regulated by the state. The Supreme Court agreed, emphasizing that restrictions on such trade must be reasonable and within the purview of Article 19(6) of the Constitution.
5. Consequences of the Non-Lifting of the Minimum Off-take of Liquor:
The Supreme Court noted that the existing licensees had failed to lift the minimum off-take quantity, resulting in revenue loss. The new policy included provisions for penalties and potential cancellation of licenses for non-compliance. The Court upheld these provisions, emphasizing that the licensees must comply with the minimum off-take requirements.
Conclusion:
The Supreme Court dismissed the special leave petitions, affirming the High Court's judgment with modulated directions. The competent authority was directed to consider renewal applications per the rules, including the minimum off-take condition. The privilege fee paid for the excise year 2002-2003 was to be adjusted, and the facility of renewal was available to those who remitted the requisite amount by July 31, 2002. The directions in Clauses (i) and (v) of the High Court's judgment remained unchanged.
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2002 (8) TMI 846
Issues:
Appeal against duty demand, penalties, and confiscation based on show cause notice allegations.
Detailed Analysis:
1. The appeal was directed against a common order confirming duty demand, penalties, and confiscation imposed by the Commissioner based on a show cause notice alleging various violations by the appellants.
2. The allegations included misrepresentation of melting loss, clandestine removal of goods, and unaccounted raw materials leading to duty evasion.
3. The appellants contested the allegations, denying incorrect melting loss representation and clandestine removal of goods.
4. The Commissioner confirmed the duty demand, penalties, and confiscation, imposing fines on the company and its directors.
5. The appellants argued lack of reliable evidence supporting the allegations, challenging the basis of the order.
6. The learned SDR supported the correctness of the impugned order.
7. The Tribunal heard both sides and reviewed the records presented.
8. The first allegation focused on excess melting loss and clearance of goods without duty payment, based on statements of company employees.
9. The company defended the melting loss percentage, citing accepted industry norms and expert opinions, challenging the Commissioner's reliance on employee statements without cross-examination.
10. Insufficient evidence was found to establish the alleged excess loss and clandestine removal of goods.
11. Lack of evidence was noted regarding the manufacturing and clearance of excess goods without duty payment.
12. Allegations of unaccounted raw materials were based on petty vouchers, lacking proof of raw material receipt or clandestine production.
13. Clandestine removal claims based on lorry receipts lacked details and corroborative evidence.
14. Insufficient evidence was found to support the charge of clandestine removal against the appellant company.
15. Non-recording of scrap did not prove clandestine removal, as the scrap was used in cleared products with duty payment.
16. The charge of clandestine removal required tangible evidence, which was absent in this case, leading to the order's reversal.
17. The Tribunal set aside the Commissioner's order, granting relief to the appellants due to the lack of substantial evidence supporting the allegations.
This comprehensive analysis highlights the key arguments, evidentiary considerations, and the Tribunal's decision in overturning the Commissioner's order based on the insufficiency of evidence to prove duty evasion allegations.
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2002 (8) TMI 845
Issues involved: Dispute over membership and allotment of plot in a cooperative society governed by Delhi Cooperative Societies Act, 1972; Challenge to appointment of arbitrator; Validity of civil court's restraint order on arbitration proceedings; Legality of ex-parte award and subsequent proceedings.
Dispute over Membership and Allotment: A dispute arose between a member of a cooperative society and the society regarding the allotment of a plot. The matter was referred to an arbitrator, but the society challenged the appointment of the arbitrator in a civil suit. The civil court issued a restraint order on the arbitration proceedings, leading to the arbitrator proceeding ex-parte and making an award in favor of the member.
Validity of Civil Court's Restraint Order: The High Court set aside the ex-parte award, deeming it vitiated due to the civil court's restraint order. However, the Division Bench held that the civil court lacked jurisdiction to issue the restraint order, rendering it a nullity. The Division Bench emphasized that the society's non-appearance before the arbitrator post-restraint order was justified, and a new arbitrator was appointed to adjudicate the dispute.
Legality of Ex-Parte Award: The Supreme Court opined that the civil court's restraint order did not automatically invalidate the arbitration proceedings. It highlighted the importance of parties acting in good faith and respecting judicial orders. The Court clarified that while the ex-parte proceedings were to be set aside, the new arbitrator would continue from where the previous one left off, subject to any injunction order by the civil court.
In conclusion, the Supreme Court dismissed the appeal, maintaining the Division Bench's order with the clarification regarding the continuation of arbitration proceedings. The Court emphasized the importance of parties respecting judicial orders and highlighted the need for proper legal procedures to challenge court orders rather than unilaterally disregarding them.
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2002 (8) TMI 844
The Madras High Court held that the assessee charitable trust was not entitled to exemption under section 11 of the Income Tax Act for the assessment years 1984-85 and 1985-86 due to the conditions in section 11(4A) not being satisfied. The trust was not for religious purposes or an institution, so it did not qualify for the exemption. The judgment favored the revenue and went against the assessee.
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2002 (8) TMI 843
Issues Involved:
1. Legality of the bifurcation of Pulluru Gram Panchayat.
2. Validity of the withdrawal of the bifurcation notification.
3. Impact of procedural lapses and incorrect facts presented in prior litigation.
4. Applicability of the concepts of per incuriam and sub silentio.
5. Authority of the 2nd respondent to revoke the bifurcation notification.
Detailed Analysis:
1. Legality of the Bifurcation of Pulluru Gram Panchayat:
The bifurcation of Pulluru Gram Panchayat, which included the formation of Kothamangapuram Gram Panchayat, was initiated by a notice dated 24-4-1995 and finalized by a notification dated 12-5-1995. This process was conducted under the relevant provisions of the A.P. Panchayat Raj Act and the Rules contained in G.O.Ms.No.515 dated 17-8-1994. The Pulluru Gram Panchayat had agreed to the bifurcation, and no objections were raised, leading to the issuance of the final notification.
2. Validity of the Withdrawal of the Bifurcation Notification:
The withdrawal of the bifurcation notification by the 2nd respondent on 5-7-2002 was challenged. The petitioner argued that once the notification dated 12-5-1995 was set aside by the Court in W.P.No.10987/95, the question of the 2nd respondent withdrawing the same does not arise. Furthermore, the bifurcation of Pulluru village did not come under the purview of the ban imposed by G.O.Rt.No.1634, P.R.& R.D. Department, dated 12-10-2001.
3. Impact of Procedural Lapses and Incorrect Facts Presented in Prior Litigation:
The prior litigation (W.P.No.10987/95) was disposed of based on incorrect facts, specifically the misidentification of the village involved in the bifurcation. The Court had set aside the notification dated 12-5-1995 based on the representation that the relevant rules were framed after the impugned order, which was incorrect. The rules were already in existence as per G.O.Ms.No.515 dated 17-8-1994. This misrepresentation led to the setting aside of the notification without proper examination of its validity.
4. Applicability of the Concepts of Per Incuriam and Sub Silentio:
The judgment highlighted that the prior decision in W.P.No.10987/95 was rendered per incuriam and sub silentio. Per incuriam applies as the Court was unaware of the existing rules at the time of the notification. Sub silentio applies because the Court did not consider whether the notification violated any criteria prescribed under the rules. These concepts justify that the notification dated 12-5-1995 should not be considered set aside.
5. Authority of the 2nd Respondent to Revoke the Bifurcation Notification:
The 2nd respondent's authority to revoke the notification was questioned. The Court concluded that the 2nd respondent lacked the power under the Act or the Rules to revoke or withdraw the notification once issued. The rescission of the rules in 2001 did not provide a basis for withdrawing the bifurcation already effected in 1995. The Court held that the notification dated 12-5-1995 remained valid and effective.
Conclusion:
The Court set aside the impugned order dated 5-7-2002 and held that the bifurcation of Pulluru Gram Panchayat into Pulluru and Kothamangapuram Gram Panchayats through the notification dated 12-5-1995 was valid. The respondents were directed to hold elections for both Gram Panchayats within three months from the date of receipt of the order. The writ petition was allowed to the extent indicated, with no costs.
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2002 (8) TMI 842
Issues involved:
The judgment involves the dismissal of an appellant from service based on fraudulent appointment allegations, the sufficiency of evidence in disciplinary proceedings, and the appropriate relief to be granted to the appellant.
Fraudulent Appointment Allegations:
The appellant claimed re-engagement as a casual laborer and subsequent grant of temporary status, but faced allegations of fraudulently securing appointment without prior work experience approval. A charge-sheet was issued, leading to a disciplinary inquiry where the appellant was found guilty and dismissed under Railway Servants (Discipline and Appeal) Rules, 1986.
Sufficiency of Evidence:
The appellant challenged the dismissal, arguing lack of valid evidence in the inquiry report. The High Court upheld the dismissal, citing oral and documentary evidence as sufficient, but the Supreme Court found the evidence lacking. The Court emphasized the need for evidence linking the appellant to the alleged misconduct, highlighting deficiencies in the inquiry process.
Relief Granted:
The Supreme Court set aside the High Court's decision and the dismissal order, deeming the appellant's guilt unsubstantiated. Considering the appellant's long absence from service, reinstatement was not ordered. Instead, respondent No.1 was directed to pay compensation equal to the average salary for two years within two months, in the interest of justice. The appeal was allowed with costs.
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2002 (8) TMI 841
Case: Supreme Court dismissed the appeal. (Citation: 2002 (8) TMI 841 - SC) Judges: B.N. Kirpal, K.G. Balakrishnan, Arijit Pasayat.
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2002 (8) TMI 840
Issues Involved:
1. Whether the assessee is engaged in "manufacture" or "production" of software programs u/s 10A of the Income-tax Act for the assessment year 1998-99.
2. Whether the assessee is entitled to carry forward the business loss of Rs. 8,28,130 in respect of the U.S. Branch for set off in subsequent years.
3. Whether the interest charged u/s 234B and 234C in the Demand Notice without levying the same in the Assessment Order is justified.
Summary:
Issue 1: Manufacture or Production of Software Programs u/s 10A
The primary issue was whether the assessee was engaged in "manufacture" or "production" of software programs as per clauses (iii) and (vi) of the Explanation to section 10A of the Income-tax Act for the assessment year 1998-99. The assessee had a software unit in SEEPZ and entered into agreements with BaaN Netherlands and BaaN India to customize standard software. The Assessing Officer denied the exemption u/s 10A, stating that the assessee was merely providing professional services and not manufacturing or producing any article or thing. The CIT(A) upheld this view, relying on several Supreme Court decisions.
The Tribunal, however, found that the customization process undertaken by the assessee involved significant intellectual effort and resulted in new programs, thus meeting the criteria for "manufacture" as per the classical connotation. The Tribunal also noted that the customization process constituted "production" as per the wider connotation of the term. The Tribunal held that the assessee's activities fell within the scope of "manufacture" and "production" as defined in section 10A and directed the Assessing Officer to allow the exemption.
Issue 2: Carry Forward of Business Loss
The assessee's claim to carry forward the business loss of Rs. 8,28,130 in respect of the U.S. Branch was consequential to the decision on the first issue. Since the Tribunal allowed the exemption u/s 10A, it also directed that the assessee be allowed to carry forward the business loss for set off in subsequent years.
Issue 3: Interest u/s 234B and 234C
The Tribunal addressed the issue of interest charged u/s 234B and 234C, noting that the Demand Notice was issued simultaneously with the Assessment Order, and both documents were signed by the Assessing Officer. Citing the Supreme Court decision in Kalyankumar Ray v. CIT and the Punjab & Haryana High Court decision in Vinod Khurana v. CIT, the Tribunal found that the interest was rightly charged. However, this issue became consequential to the Tribunal's decision on the first issue, and the Assessing Officer was directed to charge interest, if any, after giving effect to the Tribunal's order.
Conclusion:
The appeal filed by the assessee was allowed in part, with the Tribunal directing the Assessing Officer to allow the exemption u/s 10A and the carry forward of the business loss, and to reassess the interest charged u/s 234B and 234C accordingly.
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2002 (8) TMI 839
The High Court of Rajasthan ruled that the hotel building and equipment cannot be considered as 'plant' for depreciation purposes. The court cited previous cases to support their decision, stating that the assessee is not entitled to depreciation or investment allowance. The question was answered in favor of the revenue and against the assessee.
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2002 (8) TMI 838
The Appellate Tribunal CESTAT Kolkata allowed the appeal of M/s. Indian Aluminium Company Limited regarding the excisability of Aluminium Dross, waiving the predeposit of duty and penalty based on previous decisions by the Apex Court and the Tribunal that Aluminium Dross is not excisable. The appeal was allowed, and consequential reliefs were granted.
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2002 (8) TMI 837
Issues:
Challenge to order passed by Deputy Commissioner regarding payment of central excise duty.
Analysis:
The petitioners challenged an order passed by the Deputy Commissioner, Central Excise, Division-Rural-I, Ahmedabad-II, regarding the payment of central excise duty. The petitioners were discharging duty on a fortnightly basis but sometimes did not have sufficient balance in their outstanding duty on due dates. The show cause notice issued to them called for recovery of outstanding duty, interest, and imposition of penalty for contravention of certain rules. The Additional Commissioner held that the payment of outstanding duty along with interest did not involve any irregularity. However, the Deputy Commissioner passed an order stating that the petitioners had defaulted in payment and forfeited the facility to pay dues in instalments for a period of two months. The petitioners argued that the scheme had changed, causing a delay of a few days, which was addressed by the Additional Commissioner in a previous order. The revenue contended that under Rule 49(e)(ii), three defaults in a financial year lead to forfeiture of the instalment facility.
The Court noted that the impugned order was based on the same facts as the show cause notice and the Additional Commissioner's order. The delay in payment was nominal, and interest had been paid at 24%. The Additional Commissioner's explanation clarified that no prejudice was caused to the revenue due to the short delay. The principle of "Lex non curat de minimis" was applied, emphasizing that the law does not care for trifles. The Court held that the petitioners should not have been deprived of the facility to pay dues in instalments based on the facts. Consequently, the petition was allowed, and the impugned order was quashed and set aside.
In conclusion, the judgment addressed the challenge to the order passed by the Deputy Commissioner regarding the payment of central excise duty. The Court considered the delay in payment, application of the principle of "Lex non curat de minimis," and the change in the scheme affecting the petitioners' ability to pay dues in instalments. The decision favored the petitioners, allowing their challenge and setting aside the impugned order.
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2002 (8) TMI 836
Issues Involved:
1. Refusal to register transfer of shares.
2. Alleged violation of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997.
3. Jurisdiction of Company Law Board (CLB) versus SEBI.
4. Free transferability of shares under Section 111A of the Companies Act, 1956.
5. Allegations of acting in concert.
Detailed Analysis:
1. Refusal to register transfer of shares:
The petitioner sought an order to direct the respondent-company to register the transfer of 3000 equity shares and update the register of members accordingly. The respondent-company refused the registration, alleging violations of SEBI regulations. The petitioner contested this refusal, arguing that the respondent-company provided no concrete evidence of such violations.
2. Alleged violation of SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997:
The respondent-company claimed that the petitioner exceeded the 5% limit of share acquisition as prescribed by SEBI regulations, by acting in concert with other companies. The petitioner denied these allegations and requested the respondent to substantiate their claims with concrete evidence. The petitioner argued that SEBI Takeover Code is for the protection of shareholders and not for companies to misuse to prevent inconvenient investors.
3. Jurisdiction of Company Law Board (CLB) versus SEBI:
The CLB noted that under SEBI regulations, only SEBI has the authority to investigate and pass orders regarding any breaches of the regulations. The CLB emphasized that SEBI can initiate investigations suo motu or upon receiving complaints and can issue directions if any violations are found. The CLB acknowledged that the respondent-company had filed a complaint with SEBI, but SEBI had not taken any action, indicating no apparent violation of the Takeover Code.
4. Free transferability of shares under Section 111A of the Companies Act, 1956:
The petitioner argued that shares are freely transferable under Section 111A of the Companies Act and that the respondent-company had no right to refuse the transfer without valid reasons. The CLB agreed, stating that the grounds for refusal are limited under Section 111A(3) of the Companies Act. The CLB found that the respondent-company's refusal was based on insufficient and unsubstantiated claims.
5. Allegations of acting in concert:
The respondent-company alleged that the petitioner and other companies were acting in concert, citing common brokers, same-day stamp paper purchases, and common auditors as evidence. The petitioner denied these allegations, and the CLB found the respondent's claims to be neutral and insufficient to prove concerted action. The CLB concluded that there was no substantial evidence to support the respondent's allegations of acting in concert.
Conclusion:
The CLB directed the respondent-company to register the transfer of the shares within one month, as the petitioner's acquisition was below the 5% threshold and there was no substantial evidence of violation of SEBI regulations. The CLB emphasized the principle of free transferability of shares and found the respondent's refusal unjustified. The CLB also directed the respondent to register the transfer of shares in two similar petitions filed by other companies.
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2002 (8) TMI 835
Whether delay in disposal of cases by the Consumer Forum or Commission would be a ground for directing the complainant to approach Civil Court?
Whether there was negligence or not on the part of the concerned Doctors?
Held that:- In the present case, there is inordinate delay of about nine years in disposal of complaint. The object and purpose of enacting the the Consumer Protection Act, 1986 is to render simple, inexpensive and speedy remedy to the consumers with complaints against defective goods and deficient services and the benevolent piece of legislation intended to protect a large body of consumers from exploitation would be defeated. Prior to the Act, consumers were required to approach the Civil Court for securing justice for the wrong done to them and it is known fact that decision in suit takes years. Under the Act, consumers are provided with an alternative, efficacious and speedy remedy. As such, the Consumer forum is an alternative forum established under the Act to discharge the functions of a Civil Court. Therefore, delay in disposal of the complaint would not be a ground for rejecting the complaint and directing the complainant to approach the Civil Court.
Hence, for avoiding delay in disposal of complaints within prescribed period, National Commission is required to take appropriate steps including:
By exercise of Administrative control, it can be seen that competent persons are appointed as Members on all levels so that there may not be any delay in composition of the Forum or the Commission for want of Members;
It would oversee that time limit prescribed for filing defence version and disposal of complaints is strictly adhered to
It would see that complaint as well as defence version should be accompanied by documents and affidavits upon which parties intend to rely;
In cases where cross-examination of the persons who have filed affidavits is necessary, suggested questions of cross-examination be given to the persons who have tendered their affidavits and reply may be also on affidavits;
In cases where Commission deems it fit to cross- examine the witnesses in person, video conference or telephonic conference at the cost of person who so applies could be arranged or cross-examination could be through a Commission. This procedure would be helpful in cross-examination of experts, such as, Doctors.
In the result, with the aforesaid directions, the appeal stands disposed of. There shall be no order as to costs.
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