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Showing 261 to 280 of 23051 Records
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2019 (12) TMI 1429
Non filling of appeal electronically - Appeal filed manually - Whether appeal cannot be treated as non-est in the eyes of law as appeal was not filed electronically as prescribed under Rule 45 of the Income Tax Rules, 1962? - HELD THAT:- Appeal was filed manually within the period of limitation prescribed under the statute. No doubt Income Tax Rules prescribes that the appeal before the ld.CIT(A) should be filed electronically. It is matter of record that ld. CIT(A) had accepted the appeal, the defect was pointed out only in the year 2018. The right of appeal is an substantive right. The form of filing of appeal, procedure prescribed falls within the domain of law of procedure. The law of procedure has to be approached, understood and appreciated as a helpmate in the course of the process of administration of justice. Procedural provisions should be –so construed as to subserve the course of justice and not to hinder it.
It is now well-settled that a procedural provision, ordinarily, should not be construed as mandatory, if the defect in the act done in pursuance of it can be cured by permitting appropriate rectification to be carried out at a subsequent stage. Procedural laws are devised and enacted for the purpose of advancing justice. Reference can be made to the decision of Hon’ble Calcutta High Court in the case of CIT vs. Hardeodas Agarwalla Trust, [1991 (7) TMI 22 - CALCUTTA HIGH COURT].
In the present case, though the appeal was filed manually, ld. CIT(A) had taken cognizance of appeal memo. Therefore, we hold that ld. CIT(A) ought not have dismissed the appeal in limine without considering the merits of the assessments. We remit the matter back to the file of the ld. CIT(A) for denovo adjudication after affording due opportunity of hearing to the appellant in accordance with law. Hence, appeal filed by the assessee is partly allowed for statistical purposes.
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2019 (12) TMI 1428
Seeking appointment of Chartered Accountant to look into the Books of Account of the Respondent No.1 Company - Illegal transfer of shares or not - utilisation of others money for the allotment of shares or not - siphoning of funds - HELD THAT:- It appears from record that according to the Investigating Officer (Police Chief, Idukki, State of Kerala), the alleged offences of Respondents 2 and 3 are punishable under section 120(B), 406, 420, 465, 467, 468, 471, 34 IPC. The same issues are involved in this Company Petition / Interlocutory Application also. It is relevant to note that the Hon’ble High Court of Kerala dismissed the appeal and the Hon’ble Supreme Court has also dismissed the SLP filed by the Respondent No.2 with regard to the Criminal Investigation Proceedings initiated against him.
The issue raised by the applicant in the Interlocutory Application to appoint a Chartered Accountant to look into the Books of Account of the Respondent No.1 Company, is adhered with - Both the parties are directed to suggest the name of a Chartered Accountant within 2 days of this Order to enable this Bench to appoint him to look into the books of account of the 1st Respondent company and direct him to report whether the 1st respondent Company received money in respect of all the allotment of shares, both equity and preference, from its members especially, the 2nd and 3rd respondents or the 2nd and 3rd respondents utilized someone else money for the allotment of shares to them.
List the matter on 13.12.2019 for further orders.
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2019 (12) TMI 1427
Smuggling - Betel Nuts - burden to prove - appellant preferred appeal before learned Commissioner (Appeal) stating that the said betel nuts were purchased from M/s R.K. Enterprises, Kanpur and Chirag Enterprises, Lucknow and that the said betel nuts were not smuggled and the whole case was based on false statements and opportunity for cross-examination of various persons - HELD THAT:- Learned Commissioner (Appeals) has observed that appellant had given a confessional statement on 02 February, 2016 that impugned goods were smuggled from Nepal and therefore, he has held that confiscation ordered by the Original Authority was sustainable. Learned Counsel for the appellant has submitted that the statement dated 02 February, 2016 was retracted and retracted statement was relied upon by learned Commissioner (Appeals) and once the statement was retracted the Original statement did not have evidential value. Learned A.R. has submitted that after retraction of statement the appellant was once again called by Revenue for tendering the statement and appellant did not turn up.
In the circumstances of case, it is found that betel nuts are not covered by Section 123 of Customs Act, 1962. Therefore, onus was on Revenue to prove that the impugned goods were smuggled into India - the said onus has not been discharged by Revenue.
There are no grounds to hold that the impugned goods were smuggled into India - Appeal allowed - decided in favor of appellant.
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2019 (12) TMI 1426
Reopening of assessment u/s 147 - reasons to believe that some income of the assessee has escaped assessment - reassessment as barred by limitation - HELD THAT:- The phrase "reasons to believe" does not mean that the Assessing Officer should have ascertained the facts by legal evidence. All that is required is that, the AO should prima facie have some material on the basis of which there should be reason to believe of certain incomes chargeable to tax escaping assessment. There need not be any concrete evidence or proof available for coming to a final conclusion. It is only an initiation of proceedings of reassessment where the assessee gets a chance to put forth their defence, explanation and justification which would further be scrutinized by the Assessing Officer while reaching the final conclusion. One should not lose sight of the fact that the final assessment on the conclusion of proceedings under section 147 of the Act is also an appealable order wherein also the assessee has a right to agitate or challenge the order passed by the Assessing Officer on a proceeding under section 147 of the Act.
If we look into the proceedings under challenge, it would clearly reveal that there are sufficient reasons given by the Assessing Officer, which according to him is "reason to believe" of an income of more than ₹ 2.53 crores, which are chargeable to tax has escaped assessment and which has come to the notice of the Department at a later stage in the course of scrutiny.
This court has no hesitation to reach to the conclusion that the case in hand cannot be said to be one which is barred by limitation as the proceedings drawn by the Assessing Officer seems to be with sufficient material in record showing income, which otherwise is chargeable to tax having escaped assessment.
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2019 (12) TMI 1425
Revision u/s 263 - enhancing the income as originally assessed - HELD THAT:- We find no basis making enhancement. As clarified by the assessee with reference to the record of it’s bill-wise details in the books of the payer, the same is a reimbursement by the customer-payer; the words ‘S.A.’ denoting ‘Security Advance’, which is both accepted and repaid, recording it under columns ‘S.A. paid’ and ‘S.A. recovery’, i.e., on being paid and released respectively, in the bill-wise statement - Two amounts of ₹ 1.25 lac each are reflected as ‘S.A. recovery’ in the said statement, and tax deducted at source only on the balance amount/s. Further, the bill amount/s having been since paid, duly recorded in the assessee’s accounts, not accounting a part thereof by the assessee, as inferred by the Revenue, would lead to a difference in its’ accounts (with that of the payer) to that extent, i.e., ₹ 2.50 lacs, while none has been noticed or found. The said amount is thus not a trading receipt, but the receipt back of the security advance, paid earlier. The turnover would, accordingly, stand undisturbed at the amount reflected in the books, i.e., ₹ 365.44 lacs.
Allowance of interest and remuneration to the partners upon estimating the net profit of the contract business at 5% of the turnover - It is fully competent for the AO to estimate the assessee’s business income either before or after allowing the said expenditure, in which latter case the estimate would be arrived at by factoring the amount of the said expenditure and, thus, lower than the former to the said extent. The motivation for a separate allowance thereof and, therefore, the estimation of profit prior thereto, could possibly be on account of the legal position that the said expenditure, to the extent allowed in the firms’ assessment, is assessable in the hands of the individual partners. Where, therefore, not separately deducted, no amount would stand to be assessed in their hands even as, being otherwise eligible for deduction, would stand to be reckoned while estimating the firms’ income u/s. 28.
The AO had, in the instant case, estimated the ‘net’ profit at 5% (of the turnover), and allowed the said deductions thereafter. The original assessment order clearly reflects the AO to be fully conscious of the same while making the estimate, and of having applied his mind in allowing the deduction on account of interest and remuneration to the partners, i.e., as claimed, being otherwise admissible. A lower estimate by him would not by itself make his order erroneous, particularly considering that the ld. CIT had not found his order erroneous on account of a lower estimate per se, but due to his having allowed, after estimation, deduction on account of interest and remuneration to the partners. Why, he himself directs for applying a net profit rate of 5% on the ‘escaped’ turnover (of ₹ 2.50 lacs), so that he found the same as reasonable. The AO, accordingly, had no jurisdiction to revisit his said estimate in the set aside proceedings. This also answers the assessee’s additional ground, challenging the revision in estimate, in its’favour, even as the ld. CIT(A) has also held like-wise, so that there is no warrant for the said Ground; the Revenue being not in appeal.
No basis for either a review of the said estimate, revised to 8%,or for regardingit as having been made after the allowance of interest and salary to the partners, so as to preclude their allowance, as argued by the Revenue. No adjustment in respect thereof is accordingly called for.
Adjustment towards the income not separately assessed - These incomes are independent of the assessee’s contract business. We are unable to see as to how these incomes, the source whereof is a Jeep (vehicle) and surplus (for the time being) money (placed under bank deposit), would not stand to be assessed separately as ‘income from other sources’ - amount credited to the profit and loss account in their respect represents the net income, which would therefore not require any separate adjustment –the depreciation schedule not bearing ‘Jeep’ for adjustment of depreciation, a statutory allowance, exigible thereon. In fact, no contention either as regards the same being not separate or independent incomes, or the set off of any expenditure/allowance against the credits in their respect,has been raised by the assessee at any stage, including before us.
The only adjustment, therefore, that obtains consequent to the set aside by the ld. CIT is the assessment as income from other sources u/s. 56, i.e., as assessed. The assessee’s business income shall continue to be at ₹ 14,47,620/-, i.e., as original assessed. We are conscious that the allowance of deduction for remuneration to partners, allowed at ₹ 1,30,000, is to be w.r.t. ‘book profit’ (Explanation 4 to s. 40(b)(v)), so that the enhancement in income upon estimation would have no bearing on the quantum of the said deduction.
The same, however, has been considered w.r.t. the assessee’s book profit, and found allowable at the claimed amount of ₹ 1,30,000. We decide accordingly. Assessee’s appeal is partly allowed.
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2019 (12) TMI 1424
Condonation of delay - Recovery proceedings - Service of notice or communication - assessee, filed 19 appeals belatedly, varying from 807 days delay to 1567 days of delay in filing the appeals against the orders passed by the CPC, Bangalore U/s. 200A - MD of the assessee pleaded that the impugned electronic communications were not brought to the notice of the assessee, and he himself was not conversant as well as there were problems in the family as well as in the business side at the said point of time - HELD THAT:- When the recovery notice dated 04.03.2019 was received, manually, the issues were brought to his notice and he immediately took steps to file the above appeals, which caused the delay in filing each of these appeals, which is not deliberate but bonafide and beyond his control and therefore, he sought the condonation of delay in respect of each of these appeals. It was also pleaded that though the impugned orders were passed from December 2014 to December 2016, till the recovery notice served, manually on 04.03.2019, the Revenue had not sent any other communication in respect of any of the demand raised in the impugned orders.
Therefore, it is pleaded that the reason canvassed by the assessee towards the delay in filing these appeals have sufficient and reasonable cause and hence, it was prayed to condone the delay in filing each of these appeals. We find that the reason canvassed by the assessee towards the delay in filing the impugned appeals appears reasonable and sufficient. Revenue claimed to have served the impugned orders electronically, the assessee pleads that they were not brought to its notice and the Revenue has not sent any further communication till the date of recovery notice served on 04.03.2019 manually. Assessee was unaware of such orders. When there is a change from one system, say the manual system to the other system, say the electronic system , apart from relying the rules and regulations, the Revenue as an administrator of the Act must also guide the assessee in enabling them to comply with the systemic changes in a reasonable manner. Atleast in those cases, like this case, where the demand made on the assessee is pending for long time and the assessee has not responded, the Revenue should also have used other mode of communication, mentioned in sub-section (1) to section 282 of the Act. In this case, the Revenue has not brought to our notice any such communication with the assessee. Considering the totality of the facts and circumstances, the reasons canvassed by the assessee towards the delay in filing the impugned appeals appears reasonable and sufficient.
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2019 (12) TMI 1423
Application seeking permission to raise additional ground - Revenue has preferred the present appeal to assail the order passed by ITAT on the application moved by the appellant to raise additional grounds in the pending ITA preferred by the Revenue in relation to the Assessment Year 2005-06 - HELD THAT:- The impugned order is an interlocutory order by which the ITAT has, while dealing with the application seeking permission to raise additional ground, in fact, considered and rejected the additional grounds on merits. The appeal is still pending consideration before the Tribunal.
In these circumstances, we are not inclined to interfere with the impugned order at this stage. In case the Revenue is aggrieved by the final order that the ITAT may pass in the pending appeal before the Tribunal, it shall be open to the appellant to raise challenge to the order. All pleas and contentions of the appellant, as raised in the present appeal, are preserved.
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2019 (12) TMI 1422
Effective date of Withholding tax certificate - whether be made effective from the date of issue or from the beginning of the financial year i.e. 01.04.2019 - it is pointed out that one of the certificates placed at page 61 of the record has been made effective from 13.06.2019, whereas the same had been applied for the financial year 2019-20. Counsel for the petitioner states that for other jurisdictions, necessary clarifications have been issued by the respondents themselves.
HELD THAT:- Issue notice. Mr. Bhatia accepts notice.
Mr. Bhatia wishes to seek instructions. At request, adjourned to 07.01.2020.
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2019 (12) TMI 1421
Failure of the 1st Respondent to take into account the “H” forms relating to export turnover - HELD THAT:- The issue decided in the case of M/S. SHREY ELECTRO SALES PRIVATE LIMITED VERSUS THE COMMERCIAL TAX OFFICER, (NOW ASSISTANT COMMISSIONER (ST) , THE DEPUTY COMMERCIAL TAX OFFICER, [2019 (10) TMI 1370 - ANDHRA PRADESH HIGH COURT] where it was held that it is a fit case where the relief sought for by the petitioner can be granted to the extent of directing the authority to reopen assessment filed by the petitioner through letter, dated 02.05.2017, and consider the documents, more particularly, ‘C’ form and ‘H’ form declarations and pass orders in accordance with law.
Petition closed.
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2019 (12) TMI 1420
Non-acceptance of C-Forms - Rule 12(7) of the Central Sales Tax (Registration and Turnover) Rules, 1957 - contention of the petitioner is that since the subject form could not be received from the department, it could not have been produced before the authority at the time of assessment proceedings - HELD THAT:- Now, as the petitioner received the subject form, it intend to file the same, but the authority is not accepting the same.
The subject form may be received and considered by the authority, in accordance with law, on producing the same within one month from today along with a copy of this order.
Petition disposed off.
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2019 (12) TMI 1419
TDS u/s 194H - TDS on sales commission payments - HELD THAT:- No illegality or any irregularity in both the learned lower authorities’ action that assessee was required to deduct TDS on sales commission payments u/s 194H - assessee’s reliance on various clarifications also are devoid of merit since these nowhere deal with TDS on commission payment required under Chapter XVII of the Act.- lower authorities have rightly invoked the impugned disallowance in principle so far as assessee’s commission payments made to 31 salesmen are concerned. We make it clear that TDS deduction is a statutory duty for the payer under the provisions of the Act. We thus uphold both the learned lower authorities’ action in issue invoking the impugned disallowance.
Quantification of the impugned disallowance - The legislature has itself amended section 40(a)(ia) by the Finance Act 2014 w.e.f. 01.04.2015 restricting the impugned disallowance from 100% of the corresponding expenses to 30% only. The Revenue’s case is that the same applies from 01.04.2015 only not having any retrospective effect in the impugned assessment year 2011-12 - No substance in Revenue’s instant argument. This tribunal’s coordinate bench’s decision in Dipak Parui [2018 (7) TMI 2066 - ITAT KOLKATA] holds the above amendment as a curative one having a retrospective effect. We therefore direct the Assessing Officer to restrict the impugned disallowance to 30% only of the assessee’s expenditure claim. Necessary computation to follow as per law. This former substantive ground is partly accepted in above terms.
Addition u/s 68 unexplained cash credits - assessee has failed to prove the impugned sum as genuine right from scrutiny to remand proceedings as well as the CIT(A)’s order - HELD THAT:- We find no reason to sustain the impugned disallowance. Page 59 in paper book suggests that the opening balance sum of ₹ 9,22,767/- involving four entries of ₹ 3,70,446/-, 98,668/-, 3,72,438/- and 81,215/- stood paid between 01.04.2011 to 23.04.2011 as per the corresponding ledger entries. Coupled with this, the concerned party(ies) have also filed necessary confirmation before the Assessing Officer at the first instance - more particularly the assessee’s repayment through banking channel, to hold that both the lower authorities have erred in treating the impugned sum as unexplained cash credits u/s 68 - Decided in favour of assessee.
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2019 (12) TMI 1418
Transfer Pricing (TP) adjustment - corporate guarantee extended by the assessee company to its Associate Enterprise (AE) - Whether it is not an international transaction, prior to the amendment to Section 92B of the Act, by the ld. CIT(A)? - HELD THAT:- As relying on M/S. TEGA INDUSTRIES LTD. [2019 (8) TMI 1450 - ITAT KOLKATA] assessee's corporate guarantee (s) in issue do not amount to international transactions u/s. 92B - corresponding transfer pricing adjustment in question stand deleted. Decided in assessee's favour.
Disallowance u/s 14A - Sufficiency of own funds - HELD THAT:- As the assessee has own surplus funds which are not interest bearing and which were sufficient to meet the cost of investments, no disallowance can be made under Rule 8D(2)(ii) of the Rules r.w.s. 14A of the Act. The ld. D/R could not controvert this factual findings. Hence we uphold the same and dismiss Ground of the revenue.
Computation of deduction u/s 80IC - HELD THAT:- CIT(A) has followed the judgment of the Hon’ble Supreme Court in the case of CIT vs. Meghalaya Steels Ltd.[2016 (3) TMI 375 - SUPREME COURT] and directed the Assessing Officer to include the subsidiary received on sales tax as profits for the purpose of computation of deduction u/s 80IC of the Act. Though, the ld. CIT D/R controverted the findings of the ld. CIT(A), we are of the considered opinion that the judgment of the Hon’ble Supreme Court referred above applies on all fours to the facts of the case and hence we uphold the findings of the ld. CIT() on this issue.
Write back of expenses, we agree with the finding of the ld. CIT(A) that the expenses in question were allowed as a deduction from profit in earlier years and when the same are written back, they should be included in the profits eligible for deduction u/s 80IC of the Act. Thus, this ground of the revenue is dismissed.
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2019 (12) TMI 1417
Disallowance u/s 14A - HELD THAT:- As perused the fact of the case including the findings of the ld CIT(A) and other materials available on record. We note that the assessee is in appeal before us against the disallowance under Rule 8D(2)(ii) read with Section 14A - assessee submitted before us the Balance sheet of the assessee company as on 31.03.2013.
On perusal of Balance sheet, we noticed that own funds of the assessee company is ₹ 1,15,771/- lakhs, which is more than the investments in shares and securities to the tune of ₹ 18,089/- lakhs. Since Company’s net owned funds in the form of equity capital and free reserves were substantially more than the cost of share investment, yielding dividend income, no part of the interest paid is disallowable because borrowed funds were not used for acquiring shares. For that we rely on the judgment in the case of CIT vs HDFC Bank Ltd.[2016 (3) TMI 755 - BOMBAY HIGH COURT]
Therefore, the disallowance under Rule 8D(2)(ii) read with Section 14A is not attracted in assessee’s case hence we direct the Assessing Officer to delete the disallowance under Rule 8D(2)(ii) of the IT Rules. Appeal of the assessee is allowed.
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2019 (12) TMI 1416
Assessment u/s 153A - Deemed dividend u/s.2(22)(e) - Whether completed assessment can be interfered with by the AO u/s.153A of the Act only on the basis of some incriminating material found during the search action? - HELD THAT:- It is an undisputed position in this case that no incriminating material was found during the course of search and it is a settled law that no addition can be made while framing the assessment u/s.153A of the I.T.Act in the absence of any incriminating material found during the search. Keeping in view of the above, we find no reason to interfere into or deviate from the lawful findings so recorded by the ld.CIT(A), accordingly we upheld the same by dismissing this ground of appeal raised by the Revenue.
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2019 (12) TMI 1415
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - existence of debt and dispute or not - HELD THAT:- The Corporate Debtor has not denied having availed credit facilities, creation of mortgage, and classification of the loan account as "Non Performing Asset" and the non-payment of the loan amount. The Corporate Debtor and its Guarantors are jointly and severally liable to pay the outstanding amount against the loans availed by the Corporate Debtor - Since the Financial Creditor has proved existence of debt and default and there being no denial from the Corporate Debtor with respect to the outstanding amount of ' 2,83,10,52,539.32 as on 14.01.2019, this application is admitted.
Application admitted - moratorium declared.
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2019 (12) TMI 1414
Maintainability of application - initiation of CIRP - Corporate Debtor failed to liquidate its financial debt - existence of dispute or not - HELD THAT:- The arguments raised by the Corporate Debtor in his pleadings that the Financial Creditor and the Corporate Debtor duly entered into the Builder Buyer Agreement dated 01.08.2017 and Memorandum of Understanding dated 01.08.2017 for the purchase of the flats developed by the Corporate Debtor a consideration of ₹ 17,08,750 as stipulated in the Flexi Payment Plan as per Clause 4 of the Buyer Builders Agreement but contra, the Financial Creditor tendered mere ₹ 16,00,000 in totality and Ipso Facto the Corporate Debtor refused to deliver the possession of the flats for a want of total amount due ₹ 17,08,750. However, the perusal of records show it was an agreed term between the Financial Creditors and the Corporate Debtor vide the Memorandum of Understanding dated 01.08.2017 that the concerned units of the project shall be allotted to the Financial Creditor on payment of ₹ 16,00,000 and it is in opinion of this Hon'ble Tribunal that no dispute was raised by the Corporate Debtor with respect to the amount of ₹ 17,08,750/- to the Financial Creditor hence, the contention of the Corporate Debtor to not handover the possession of the said units of the project holds no legal ground.
Petition admitted.
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2019 (12) TMI 1413
Grant of approval u/s. 80G(V)(vi) denied - evidence filed by the assessee showed that no charitable activity was carried on by the trust - application for grant of registration u/s. 12A allowed - HELD THAT:- As decided in case of Bhima Foundation [2019 (9) TMI 1465 - ITAT BANGALORE] Tribunal came to the conclusion that the assessee trust is newly set up and when the approval u/s. 80G is sought for and when the period between the formation of trust and examination of application of the assessee for grant of approval u/s. 80G of the Act was only a period of 5 months, it is not possible for such organization to demonstrate the actual carrying of its activities. The Tribunal placed reliance on the decision of DIT(E) v. Meenakshi Amma Endowment Trust, [2010 (11) TMI 853 - KARNATAKA HIGH COURT] and came to the conclusion that for want of proof of activities of a trust, when the trust was yet to commence its activities, an application for grant of registration u/s.12A cannot be rejected. The Tribunal also placed reliance on the decision of ITAT Jaipur Bench in the case of Anand Incubation Centre v. CIT(E)[2017 (11) TMI 77 - ITAT JAIPUR] wherein on identical facts, approval u/s. 80G was directed to be granted. Thus , we direct the CIT(E) to grant registration to the assessee u/s. 80G - Decided in favour of assessee.
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2019 (12) TMI 1412
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - existence of debt and dispute or not - HELD THAT:- The Corporate Debtor is referring to the Purchase order of the year 2016. The Operational Creditor is contending that all the works were completed in respect of purchase orders which are two in number of the year 2016. On the other hand, the Corporate Debtor is trying to contend that there is a pre-existing dispute by referring to purchase orders of the year 2016 which is not at all the subject matter of the present petition. Except alleging some dispute with regard to the purchase orders of 2016, the Corporate Debtor did not raise any objection with regard to the purchase orders relied upon by the Operational Creditor in the present case. Therefore, it cannot be said that there is a prior dispute.
Admittedly, the Corporate Debtor has not raised any dispute with regard to placing purchase order with Operational Creditor and further there is no dispute with regard to raising invoices by the Operational Creditor. Thus, Operational Creditor is able to establish default of operational debt. The Operational Creditor suggested the name of Interim Resolution Professional who has given his consent in Form-2. The Application is in order and deserves to be admitted.
Application admitted - moratorium declared.
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2019 (12) TMI 1411
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - existence of debt and dispute or not - HELD THAT:- In the present case, there is no such dispute as pre-existing, the dispute which was being claimed to be pre-existing by the corporate debtor did not survive - The applicant has attached the copy of Bank statements issued by Syndicate Bank in compliance with the requirement of Section 9(3)(c) of the IBC 2016.
The present application is complete and the Operational Creditor is entitled to claim its dues, establishing the default in payment of the operational debt beyond doubt, and fulfillment of requirements under section 9(5) of the Code. Hence, the present application is admitted.
Application admitted - moratorium declared.
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2019 (12) TMI 1410
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - existence of debt and dispute or not - time limitation - allegation that the Petitioner has not completed the work within the given time and there was a delay of 107 days in completing the work - HELD THAT:- Clause 4 of the work order specifically provides for a time period of 67 days for completing the works which includes all holidays and weekly holidays and other non-working days. Therefore, excluding the delay due to Petitioner's failure on account of local conditions is untenable and was disregarded by the Corporate Debtor. The work order was issued for an aggregate contract value of ₹ 1,14,04,128/- and that the Corporate Debtor had already paid an amount of ₹ 1,04,52,250/-. The ledger statement thus certified the amount paid by the Corporate Debtor to the Petitioner.
The Corporate Debtor has enclosed the following emails, which were all before the issue of demand notice dated 04.12.2018 to show that there is a pre-existing dispute - All the above emails were exchanged between the parties before the issuance of demand notice and upon perusal of the same it can be said that admittedly there is a delay in execution of the project and hence there is a pre-existing dispute covered under section 5(6) of the Code.
It is beneficial to refer to the judgement of the Hon'ble Supreme Court in the case of MOBILOX INNOVATIONS PRIVATE LIMITED VERSUS KIRUSA SOFTWARE PRIVATE LIMITED [2017 (9) TMI 1270 - SUPREME COURT] wherein it was held that So long as a dispute truly exists in fact and is not spurious, hypothetical or illusory, the adjudicating authority has to reject the application.
When the law laid down by the Hon'ble Supreme Court in the above case is applied to the facts of the present case it is established that there is a clear dispute relating to the existence of debt as provided u/s 5(6)(c) of the Code, since the Petitioner has not completed the project in time - petition dismissed.
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