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Showing 381 to 400 of 14509 Records
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2020 (12) TMI 1033
Reopening of assessment u/s 147 - HELD THAT:- AO was not justified to reopen the case of the assessee in view of the provisions u/s 147/148 - No tangible material is on record for reopening the case on the basis of which the AO formed reason to belief that the income has escaped assessment. Mere mentioning the facts as shown by the assessee about the shares premium nowhere gives the plausible reason to the AO to reopen the case u/s 147/148 - Nothing is on record to which it can be assumed that under which circumstances the income of the assessee has become escaped assessment.
The other important thing which came into notice that on the basis of similar facts and circumstances the Hon’ble ITAT has decided the issue in case titled as Balbir Ispat Pvt. Ltd. [2019 (1) TMI 1840 - ITAT MUMBAI] in which the notice u/s 147 of the Act nowhere justified. AO has absolutely no material to even suspect, forget believe that income has escaped assessment. Hence, we quashed the reopening and accordingly, the issue of assessee’s appeal on jurisdiction is hereby allowed.
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2020 (12) TMI 1032
TP Adjustment - payments made for intra-group services received by the Appellant - "most appropriate method" and Comparability analysis - HELD THAT:- We direct Ld. TPO to judge the requirement of services from viewpoint of assessee as a businessman. Therefore in this regard we are of view that assessee has to substantiate that these services are required by it. We note that assessee has entered into Intra Group Service agreement with AE, which is placed at page 467 of paper book Volume II. This goes to prove that services were required by assessee.
We are of considered opinion that for these services, assessee has to demonstrate and satisfy Evidence Test or rendition test and benefit test, as envisaged u/s. 92(2) of the Act, and that, services provided by AE are neither duplicative nor shareholder's activity. Ld. AO/TPO is then directed to determine Arm's length price of these services based on documents submitted by assessee by determining "most appropriate method" and Comparability analysis.
Protective assessment u/s. 40(a)(i) for non deduction of TDS on payment made towards managerial services - We note that Ld. TPO has made adjustment in respect of payments made towards managerial services, which has been remanded for denovo consideration based on evidences/documents filed by assessee.
Assessee has deducted TDS on certain payments made to AE. It is the submission of Ld. AR that balance amount, pertains to other services. Ld. AR submits that such other payments cannot be termed as technical in nature. As we have remitted the transfer pricing adjustment on same issues to Ld. TPO for denovo consideration, this issue becomes academic at this stage.
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2020 (12) TMI 1031
Reopening of assessment u/s 147 - Eligibility of reasons to believe - HELD THAT:- As during the course of original assessment proceedings, on the issue of allowability the assessee had disclosed the information to the AO and thus it would appear that assessee had disclosed the primary facts at its disposal to the Assessing Officer for the purpose of assessment. In such circumstances, it cannot be said that assessee did not disclose fully and truly all material facts necessary for the assessment. Consequently, the AO could not have arrived at the satisfaction that he had reasons to believe that income chargeable to tax had escaped assessment. In the absence of the same, the AO could not have assumed jurisdiction and issued the impugned notice under section 148 of the Act.
Even on the reading of the reasons recorded, it cannot be said that it suggests about any failure on the part of the assessee to disclose truly and fully all material facts necessary for assessment. A claim which has been allowed in the original assessment proceedings after examination of the relevant details and facts cannot be amenable to provisions of Section 147/148.
In the present case, notice for re-opening of the assessment u/s 147 of the Act is not as per the mandate of Sec.147 of the Act and therefore the re-opening is not permissible. We are therefore of the view that the notice issued for re-opening has to be set aside and the same deserves to be quashed.
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2020 (12) TMI 1030
Notice u/s. 143(3) in the name of non existent entity - HELD THAT:- The facts of the Assessee’s case is identical to the facts of the case decided by the Hon’ble Supreme Court in the case of M/s.Maruti Suzuki India Ltd.[2019 (7) TMI 1449 - SUPREME COURT]. Since the assessee company ceased to be in existence as on the date when the AO passed the order of assessment, assessment so framed is not sustainable in the eyes of law, being a nullity.
Since the assessee company ceased to be in existence as on the date when the AO passed the order of assessment, assessment so framed is not sustainable in the eyes of law, being a nullity. The order of assessment is liable to be annulled and is hereby annulled. Appeal by the Assessee is allowed.
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2020 (12) TMI 1029
Disallowance of licence fee - system of accounting - accrual of expenditure - HELD THAT:- When the assessee was granted the liquor licence for financial year 2006-07 i.e. Assessment Year 2007-08 he has claimed it as expenditure in the Profit & Loss Account of Assessment Year 2007-08. We are of the considered view that since the expenditure of licence fees has crystallized during Financial Year 2006-07 (Assessment Year 2007-08), the assessee has rightly claimed it as an expenditure against revenue of assessment year 2007-08.
Issue of cash system/mercantile system of accounting is not having any impact on the issue under consideration because the amount of advance licence fees paid during Financial Year 2005-06 was just an advance and it converted into expenditure during Financial Year 2006-07 (Assessment Year 2007-08). Thus Ld. CIT(A) was not justified in confirming the addition made by Ld. A.O. We thus set aside the finding of Ld. CIT(A) and allow the claim of the assessee for the expenditure of licence fees
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2020 (12) TMI 1028
Enhancement of the income by the CIT(A) - AO after hearing the assessee, considered the turnover as per Form-26AS as the gross receipts of the assessee and estimated the Net Profit @8% of such turnover and brought it to tax - HELD THAT:- CIT(A) has not given any notice in writing for enhancement of income to the assessee.
DR also confirmed that no written notice was given to the assessee.
Taking the same into consideration, we deem it fit and proper to remit the issue to the file of CIT(A) for reconsideration of the issue in accordance with law and if the CIT(A) feels that the assessment has to be enhanced, then, he shall issue a notice to the assessee and after considering the assessee's objections, if any, filed by the assessee in writing, thereafter only, the CIT(A) shall adjudicate the appeal. - Appeal of assessee is allowed for statistical purposes.
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2020 (12) TMI 1027
Denial of registration u/s 12A r.w.s. 12AA - Charitable activity u/s 2(15) - HELD THAT:- Admittedly, the appellant-trust is a registered trust. As per the registration deed, the property of the trust was donated by one goswami Shri Parshotam Lal Ji s/o. goswami Shri Damodar Lal ji for establishment of Shri Goverdhannath Ji temple and for doing other religious and charitable activities.
One of the objects is to impart education to the students without any discrimination of caste or religion; to give scholarship and help to needy students for higher education etc. Apart from that, objects of organizing medical camps, blood donations are also part of the objects as per bye laws of the trust. The trust also holds the activity of 'bhandara (free food) to all. As per the provisions of section 11 read with section 12A of the Income Tax Act, 1961, the registration can be granted to the charitable or religious trust or institution. A perusal of the order of the Ld. CIT(E) shows that the Ld. CIT(E) has declined registration mainly on the ground that the appellant trust is pre-dominantly doing the religious activities and that the same do not partake the character of charitable activity. However, as per the relevant provisions of section 11 read with sections12A & 12AA of the Act, the registration can be granted to charitable or religious institution. Under the circumstances, there is no bar in granting registration to a religious institution under the relevant provisions. Moreover, as per the objects of the trust, the trust is also involved in charitable activities as noted above.
The appeal of the appellant trust is allowed and the Ld. CIT (E) is directed to register the appellant-trust u/s. 12A/12AA of the Income Tax Act. - Decided in favour of assessee.
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2020 (12) TMI 1026
Reopening of assessment u/s 147 - AO had received information from the Investigation Wing about certain entries made/provided by one Shri Vipin Garg, at Tamilnadu, as per the information, the assessee had received an amount from the concern belonging to said Vipin Garg - HELD THAT:- Information, though relevant, but was needed to be examined and verified with the accounts as well as the Income-tax return filed by the assessee. However, the Assessing Officer wrongly recorded that assessee had not filed any return of income. This fact recorded by the Assessing Officer itself shows that the Assessing Officer has not consulted the relevant record pertaining to the Income-tax return of the assessee and without consulting the relevant record, the Assessing Officer formed the belief on the basis of the information received from the Investigation Wing.
The said information, should have been verified after correlating with the records of the assessee and thereafter the AO could have formed the belief that the said amount shown to have been received by the assessee from a concern of Shri Vipin Garg was, in fact, an accommodation entry or not.
Assessing Officer had failed to properly apply his mind and the belief formed by the Assessing Officer regarding escapement of income of the assessee was based on mere suspicions only. Therefore, the reopening of the assessment without a reasonable belief formed by the Assessing Officer by applying his mind, cannot be held valid. - Decided in favour of assessee.
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2020 (12) TMI 1025
TDS u/s 194H - Default u/ss. 201(1)/201(1A) - non deduction of tds - payment of dhami/commission by the assessee - HELD THAT:- As the requisite purchase bills for A.Y. 2013-14 and A.Y. 2015-16 were not produced by the assessee, therefore, the ITO(TDS) had presumed that the assessee in the said years also must have paid dhami/commission of the same amount as in A.Y. 2014-15, de hors deduction of tax at source. We would mince no words in saying that we are unable to persuade ourselves to subscribe to the basis as per which the assessee had been held to be in default U/ss. 201(1)/201(1A) of the Act, in respect of a presumptive payment of dhami/commission by the assessee in A.Y. 2013-14 and A.Y. 2015-16
It is the claim of the Ld. A.R. that as the respective payees i.e. the dealers in wheat to whom the aforesaid sum had been paid/credited had taken into account the impugned sum of dhami/commission while computing their income in their returns of income filed under Sec. 139 for the captioned years under consideration, and have also paid the taxes on the income declared in such respective returns of income, therefore, the assessee cannot be treated as being in default as per the 'first proviso' to Sec. 201(1).
Also, it has been stated by the Ld. A.R., that certificates from the accountant in the prescribed form i.e. 'Form No. 26A' verifying the aforesaid facts had been obtained by the assessee. On the basis of the aforesaid facts, we are of the considered view that the matter in all fairness requires to be restored to the file of the ITO(TDS) for verifying the veracity of the aforesaid claim of the assessee. In the course of the 'set aside' proceedings, the ITO(TDS) shall verify the maintainability of the claim of the assessee that now when the requisite conditions envisaged in the 'first proviso' to Sec. 201(1) of the Act had been complied on its part, it cannot be treated as being in default and consequentially be saddled with the liability U/ss. 201(1)/201(1A) of the Act. Before parting, we may herein clarify that the assessee shall in the course of the 'set aside' proceedings furnish the requisite details as would be called for by the ITO(TDS) for the purpose of giving effect to our aforesaid directions.
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2020 (12) TMI 1024
Revision u/s 263 - amount of HUF was deposited not in the account of the HUF but into the account of the individual - as per assessee there is no demand against the assessee as the assessed income and returned income are same - HELD THAT:- CIT has rightly directed the AO to frame the assessment afresh as he found that the office note recorded by the then ITO Ward-5(3), Amritsar is factually incorrect. CIT also found that the amount of ₹ 29,69,855/- belonged statedly to the HUF was deposited not in the account of the HUF but into the account of the individual.
During the course of hearing the AR was also unable to substantiate that this issue was examined by the AO and there is any conclusive findings by the AO as per law. From the order of Pr. CIT, it is clear that this issue was not examined by the AO. It was expected from the AO that he has assessed the taxable income as per law. Firstly, the Assessing Officer is investigating officer thereafter he is an adjudicating officer. If the AO failed to carry out adequate enquiry about the alleged transactions in the name of the assessee, which are present in this case, therefore, the Pr. CIT has rightly invoked the provisions of Section 263 of the I.T. Act to reopen the completed assessment.
In the revised grounds of appeal the assessee has challenged only one issue for invoking the revisionary proceedings by the Pr. CIT u/s. 263 without application of mind by the Pr. CIT. It is clear from the order of the Pr. CIT at page 2 that the Pr. CIT before invoking the revisionary power u/s. 263 of the Act has asked for the report of the AO and receipt of the report from the AO the same has been confronted to the counsel of the assessee.
CIT has enquired before invoking the provisions of Section 263 of the I.T. Act. Accordingly, the revised grounds of appeal raised by the assessee have no merit and the same are dismissed. We, therefore, of the opinion that the Pr. CIT has taken a right view in quashing the assessment framed by the AO and directing the AO to make fresh assessment. Accordingly, we uphold the findings recorded by the Pr. CIT and dismiss the appeal of the assessee.
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2020 (12) TMI 1023
Addition u/s 41(1) - treating of the outstanding liability of the assessee towards M/s. Aakshi Electrical Sys Pvt. Ltd., as a ceased liability within the meaning of Sec. 41(1) - whether liability has ceased to exist and the appellant has claimed the amount as an expenditure when the liability was created? - HELD THAT:- A.O. had failed to discharge the 'onus' that was cast upon him as regards proving the satisfaction of the aforesaid requisite conditions prior to invoking of the provisions of Sec. 41(1) - Not only that, we find that even otherwise there is nothing discernible from the record which could persuade us to conclude that the benefit, if any, obtained by the assessee by way of remission of cessation of the aforesaid liability could be related to the year under consideration.
Lower authorities had shirked from making necessary verifications, which could have safely be done by calling for the requisite details from the aforementioned party i.e. M/s. Aakshi Electrical Sys Pvt. Ltd. But then, we also cannot remain oblivious of the fact that the assessee had also failed to do the bare minimum in order to establish that the liability towards the aforementioned party, though disputed, was however outstanding. Apart from that, except for harping on the fact that the payment to the aforementioned party was towards an advance in lieu of a contract for installations to be carried out in a hospital i.e. a capital expenditure, nothing had been placed on record by the assessee which could irrefutably substantiate the said factual position to the hilt. In the backdrop of the aforesaid facts, we are of the considered view that in all fairness the matter requires to be restored to the file of the A.O. for fresh adjudication - Decided in favour of assessee for statistical purposes..
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2020 (12) TMI 1022
Restoration of the name of the Company in the Register of Companies - section 252 of the Companies Act, 2013 Read with Rule 87A of the NCLT Rules, 2016 - HELD THAT:- It is not in dispute that the Registrar of Companies is conferred with power U/s. 248(3) to strike off the Company, if the Company has failed to commence its business within one year of its incorporation or a Company is not carrying on any business or operation for a period of two immediately preceding financial years and has not made any Application within such period for obtaining the status of a dormant Company U/s. 455. However, Section 248(6) states that the Registrar of Companies, before finally striking off Company, has to satisfy himself that sufficient provision has been made for the realization of all amounts due to the Company and for the payment or discharge of its liabilities and obligations by the Company within a reasonable time, and, if necessary, obtain necessary undertakings from the Managing Director, Director or other persons in charge of the management of the Company.
The impugned order striking off the Company was in accordance with law, the Tribunal has to take into consideration the bona fide contentions of Petitioner seeking to restore the name of Company, by taking a lenient view of the issue in the interest of justice and ease of doing business, instead of rigidly interpreting the law on the issue. It is also not in dispute that the instant Company Petition is filed in accordance with law - The Registrar of Companies, Karnataka, the Respondent herein, is directed to restore the name of the Company in the Register maintained by the Registrar of Companies, Karnataka as if its name had not been struck off from the rolls of the Register, with restoration of all consequential action taken by Registrar of Companies, which includes restoration of DINs of its Directors.
Application allowed.
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2020 (12) TMI 1021
Direction to release and make over the proceeds of account lying with State Bank of India, specialized institutional banking branch, Kolkata with the accrued interest thereon in favour of respondents award/decreeholders - Failure to discharge the obligation of agreement and liability of making reimbursemnt by way of refund of amount collected earlier.
Whether an awarded claim deposited by the award-debtor with the executing court can be realised and received by the award-holder to the satisfaction of the award, when the said awarded claim was not a part of the resolution process of the award-debtor, after the resolution plan is approved by the relevant adjudicating authority under the provisions of the said IBC?
HELD THAT:- The provisions under Order XXI of the Code of Civil Procedure, it is settled that, is a complete code within the code of 1908. A crystallised decree when remains unsatisfied, to enforce the same, the provisions of the said complete code is available to the beneficiary of the decree to initiate a proper execution proceeding before an executing court having competent jurisdiction. It is equally settled and the time tested proposition that the executing court cannot travel beyond the decree - In the facts of this case, the arbitral award having acquired the character of decree and having been crystallised, the beneficiary of the said award, namely, the respondents award-holders had every right to institute as many as execution proceedings in all possible manners to execute the award until the same is satisfied in its favour. Therefore, the filing of the execution proceeding by the respondents award-holders for execution of the said award is just, proper, lawful and valid.
In the present case, the respondents whole-heartedly embrace the order dated March 16, 2009 passed by the appellate court here. There is no impediment to the respondents being permitted to collect the money and receive the same on their undertaking to abandon the appeal.
The red herring that has been shown by the appellants herein is the failure on the part of the respondents to lodge a claim pursuant to the advertisement being issued in the insolvency proceedings. Indeed, the respondents could not have lodged any claim, unless the respondents were to exercise any rights pertaining to the Shakespeare Sarani property and such property was still a part of the assets of the insolvent company. Upon the original award-debtor tendering the awarded amount in court, such award-debtor ceased to have any right over the money or the amount tendered and remaining in court. Such money could never revert to the award-debtor and, if the award-holders did not ultimately receive the same, the award-debtor would still have no right to obtain refund thereof. It is for such reason that the judgments cited are of no avail to the appellants herein. The judgment and order impugned does not call for any interference.
This court is of the considered opinion that the appeal preferred by the appellants is not maintainable, and devoid of any merit and as such the same is dismissed with costs assessed at ₹ 50,000/-.
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2020 (12) TMI 1020
Maintainability of petition - CIRP proceedings still going on - validity of proposed declaration of the petitioners as wilful defaulters under the RBI Master Circular dated July 1, 2015 - HELD THAT:- CIRP proceedings are going on in respect of the company-in-question vide order dated February 7, 2020 passed by the National Company Law Tribunal, Kolkata, thus, disabling the company itself from preferring the writ petition. That apart, since the show-cause notice was issued to the petitioners themselves and the petitioners were held to be wilful defaulters, the present challenge at the behest of the petitioners, without impleading the company separately, is valid in law.
Although the respondents have pleaded public interest in the matter, the mechanism of declaring wilful default was put in place to prevent corrosion of the economy and financial malpractices. However, lack of transparency in the mechanism of declaring wilful defaulters would itself be a major disincentive to commerce, which would adversely affect the economy at large. Even if not a stigma by itself, such declaration has far-reaching effect, since the concerned persons would not get any loans or other financial benefits and incentives in future due to such declaration. Hence, the respondents’ argument, as to the irregularity committed by them being minor and without prejudice to the petitioners, does not hold water - Not only did the respondents arrive at conclusive findings in the show-cause notice itself, thereby hinting at a predetermined and closed mind-set, having pre-decided that the petitioners were wilful defaulters even prior to the orders of the two committees, no copy of the Identification Committee order was handed over to the petitioners at all. The flimsy pretext that the said order was a virtual reiteration of the initial order of the committee defies logic since, after such order, a coordinate bench of this court had specifically directed fresh order to be passed, thereby rendering the previous order infructuous. The admission of the respondents that the subsequent order was a mere reiteration of the previous order itself vitiates the sanctity of the latter order for lack of application of independent judicial mind in the second adjudication.
The Identification Committee permitted the petitioners to file their reply directly before the Review Committee, which deprived the petitioners of a hearing before the first committee. The scope of consideration by the Review Committee would only arise once the Identification Committee decides the matter of declaration of wilful defaulter upon considering the stand of the alleged delinquent. Without such opportunity, the order of the Identification Committee would be incomplete, being bereft of the delinquents’ version, leaving no scope for the Review Committee to consider the petitioners’ defence - the argument, that the Review Committee had no option but to confirm the Identification Committee order in its entirety, is based on faulty logic, since the petitioners had, in fact, specifically asked for a copy of forensic report and other relevant documents, which was denied to them. Thus, it was impossible for the petitioners to put their representation on fact and law before either of the Committees. The petitioners had no opportunity to refute the observations of the forensic report, to show its inherent contradictions and/or point out the irrelevance of the report in the context of declaration of willful default, although the report was virtually the sole basis of the show cause notice and the impugned orders.
The committees acted contrary to logic befitting a prudent person in relying on the same as sacrosanct to hold the petitioners to be wilful defaulters - the entire effort of the Identification Committee and the Review Committee was to somehow label the petitioners as wilful defaulters, in the process violating all norms of natural justice and the provisions of the RBI Master Circular, 2015.
The impugned orders are patently illegal and de hors the RBI guidelines - Petition allowed.
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2020 (12) TMI 1019
Money Laundering - Attachment of properties - Agricultural Land - right of the appellants to the properties in question - SCN not issued to appellant - whether there is any violation of the provisions of law as enunciated in Prevention of Money Laundering Act (PMLA), 2002? - HELD THAT:- On perusal of the plain copies of the chain of documents, copy of the impugned order, reply made by the respondent it is prima facie that the appellants are the owners having interest in the properties in question as they had only made-over agreements to different persons for cultivation. A decision cannot be made on assumption & presumption that as the appellants have leased out the aforesaid properties for cultivation purposes for a long period amounts to lose of the ownership. It can only be decided by Competent Civil Court. Nothing has been submitted during the course of hearing that Shri P.K.M. Selvam or Shri S. Sankaranarayanan or the transferors of cultivation rights to these two persons have ever raised any dispute that the present appellants are not the owners of the aforesaid properties in question.
There is a clear violation of principle of natural justice. The appellants ought to have noticed by the respondent (ED) and Adjudicating Authority before deciding on attachment of the aforesaid properties - The Adjudicating Authority shall, in accordance with the provisions of sub-section(2) of Section 8 of the PMLA, 2002, record finding whether all or any of the properties mentioned above are involved in money laundering and pass appropriate orders in accordance with law.
Matter remanded to the Adjudicating Authority for re-adjudication of the case qua the appellants within 150 days from the date of receipt of this order or from the date of the order when either of the parties brings it to the knowledge of this order, before the Adjudicating Authority - appeal allowed by way of remand.
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2020 (12) TMI 1018
Manpower recruitment or supply agency service - Non-payment of service tax - agreements entered into by the appellant with its group companies located in the USA, UK, Dublin (Ireland), Singapore etc. and provide general back office and operational support to such group companies - certain employees who were seconded to the appellant by the foreign group companies - amounts are remitted by the Appellant in foreign currency and accounted in their financial statements - Demand alongwith interest and penalty - Circular F.No. B1/6/2005-TRU dated 27.07.2005 - HELD THAT:- The definition of “Manpower Recruitment or Supply Agency” seeks to bring under its ambit, two types of activities i.e. recruitment of manpower and supply of manpower and further the service becomes the taxable service only if provided by a manpower recruitment or supply agency but in the present case, we are concerned only with the supply of manpower. Further, it is found that after the post July 2012, the definition of service specifically incorporated seeks to exclude certain transactions from the ambit of service and provision of service by an employee to the employer in the course of or in relation to his employment stands excluded from the definition of service. Also, the legal position post negative list regime does not make any departure from the settled position of law as existed before 2012 with respect to the service tax implications on deputation of employees. In fact, the above exclusion in the definition of service amplifies the position of law to keep employees providing service to the employer in the course of their employment out of the purview of service tax. We have also examined the agreements entered into by the appellant with a group company which are specifically for provision of certain specialized services and are not related to ‘supply of manpower’ which is evident from various clauses in the Agreements and we also find that group companies are not in the business of supplying manpower.
The persons seconded to the appellant working in the capacity of employees and payment of salaries etc is made to such employees by group companies only for disbursement purposes and hence employee-employer relationship exist and such an activity cannot be termed as “manpower recruitment or supply agency” and the whole arrangement between the appellant and its group companies does not fall under the taxable service of manpower recruitment or supply agency service as defined under the Finance Act, 1994 - Also, there is no service provider-recipient relationship in the present case, as required by Section 65(105)(k).
The method of disbursement of salary cannot determine the nature of the transaction and this issue was considered in the case of M/S VOLKSWAGEN INDIA PVT LTD VERSUS COMMISSIONER OF CENTRAL EXCISE [2013 (11) TMI 298 - CESTAT MUMBAI] which has been upheld by the Hon’ble Apex Court in the case of COMMISSIONER VERSUS VOLKSWAGEN INDIA (PVT.) LTD. [2016 (1) TMI 1320 - SC ORDER].
The Hon’ble High Court of Gujarat in the case of COMMISSIONER OF SERVICE TAX VERSUS ARVIND MILLS LTD. [2014 (4) TMI 132 - GUJARAT HIGH COURT] has held that even if the actual cost incurred by appellant in terms of salary remuneration and perquisites is only reimbursed by group of companies, there remains no element of profit or finance benefit. The arrangement is that of the continuous control and the direction of the company to whom the holding company has deputed the employee, such an arrangement is out of the ambit to be called manpower supply service.
As such, there is no supply of manpower service which is rendered to the appellant by the foreign/holding company. As far as short payment of service tax of ₹ 41,11,742 and the interest of ₹ 16,82,810 is concerned, the learned Counsel has submitted that the entire amount totaling ₹ 47,17,537/- (service tax and interest) has been paid vide GAR Challan and the challans have also been annexed but the learned Commissioner has not considered the same and appropriated the same also - For this discrepancy, matter remanded to the learned Commissioner to examine the payment of service tax paid by the appellant through various challans and thereafter determine the demand of service tax and interest due from the appellant, if any.
Appeal allowed by way of remand.
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2020 (12) TMI 1017
Condonation of delay in filing appeal - recovery of CENVAT Credit - construction services other than residential complex - HELD THAT:- It is a fact that the appellant had taken loan from the banks and ultimately the loan was declared as NPA and proceedings were initiated against the appellant under the provisions of the SARFAESI Act. Possession was also taken by the bank on July 26, 2013. After the impugned order was passed by the Commissioner on February 10, 2014, the appellant has reversed the CENVAT credit. It also needs to be noticed that the mall was ultimately auctioned by J.M. Financial Assets Reconstruction Company. It also transpire from the records that the Department had written letters to J.M. Financial Assets Reconstruction Company and the auction purchaser for compliance of the order passed by the Commissioner.
The appellant in the present appeal has satisfactorily explained the delay in filing the appeal.
The delay condonation application is allowed subject to payment of cost of ₹ 25,000/-, which the appellant shall deposit within the period of one month from today in the Prime Minister’s CARES Fund - matter shall be listed on January 8, 2021 for a report regarding compliance of the order.
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2020 (12) TMI 1016
Commercial Coaching or Training service - the contention of the Appellant/Applicant that the retrospective amendment in the definition of Section 65(105)(zzc) of Chapter V of the Finance Act, 1994 without a validation clause would not affect pending proceedings, was rejected - time limitation - HELD THAT:- The clarification sought for by the Appellant/Applicant in the Miscellaneous Applications is wholly unnecessary for the reason that on a bare perusal of Para 8 and 9 of the Final order alongwith Para 12 and 13 thereof, it is amply clear that the Service Tax demand of ₹ 19,02,103/- on reimbursable expenses for the period of October, 2001 to March 2006 is already set aside and further in respect of Service Tax demand of ₹ 78,12,418/- for the period of 01.07.2003 to 31.03.2008 under the category of Commercial Coaching or Training service, the appellant is extended the benefit of exemption under Notification No. 9/2003-ST dated 20.06.2003 and Notification No. 24/2004-ST dated 10.04.2004. Further, on limitation it is held that demand upto March, 2006 is barred by normal period of limitation. When the tax demand for the entire period in dispute has already been set aside and benefit of exemption under Notification No. 9/2003-ST dated 20.06.2003 and Notification No. 24/2004-ST dated 10.04.2004 has been extended on merits, no demand survives and while dealing with the contentions of the Appellant/Applicant, on points of limitation, it has been held that demand upto March, 2006 is barred by limitation.
Appeal allowed - decided in favor of appellant.
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2020 (12) TMI 1015
Admissibility of abatement under the Notification dated March 1, 2006 - impugned order has denied the abatement availed by the appellant during the month of March, 2006 on the ground that the appellant availed and utilized credit for providing the output services of CIC for the month of March 2006, which is not permitted under the Notification dated March 1, 2006 - HELD THAT:- CENVAT credit availed by the appellant of the service tax paid by the service providers for the services rendered prior to 01.03.2006 cannot be faulted with as availment of CENVAT credit by service recipient is subject to the condition that payment for such service rendered as the provisions. Undisputedly, in this case the appellant had paid the service providers / settled the service providers bill subsequently from March 2006 for the service rendered prior to 01.03.2006 and has correctly claimed the legitimate CENVAT credit available.
The Commissioner has held in the impugned order that the agreement between the Principles and the Consortium Members is a composite contract for provision of services and supply of goods. According to the appellant, the composite contract has the essential character of a “works contract”, as it involves both supply of goods as well as provision of services. Hence, the various services provided by the appellant under the agreement will more appropriately being classified under ‘works contract’ service which became taxable w.e.f June 1, 2007 - The impugned order also records a finding that the contract involves provision of services as well as supply of goods. Thus, the demand raised for a period prior to June 1, 2007 is not sustainable. Even for the period post June 1, 2007, the demand cannot be sustained as it has been raised under CIC and ECI and not under “works contract” service.
The demand raised under CIC and ECI for the period July 1, 2007 and post June 1, 2007 cannot be sustained - Appeal allowed - decided in favor of appellant.
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2020 (12) TMI 1014
Business Auxiliary Services - service tax on the incentives received by the appellant - tax on incentives prior to July, 2012 - HELD THAT:- The appellant purchases vehicles from MUL and sells the same to the buyers. It is clear from the agreement that the appellant works on a principal to principal basis and not as an agent of MUL. This is for the reason that the agreement itself provides that the appellant has to undertake certain sales promotion activities as well. The carrying out of such activities by the appellant is for the mutual benefit of the business of the appellant as well as the business of MUL. The amount of incentives received on such account cannot, therefore, be treated as consideration for any service. The incentives received by the appellant cannot, therefore, be leviable to service tax.
The demand of service tax in respect of the amount collected on account of bouncing of cheques and cancellation of orders is also not sustainable. These amount are penal in nature and not towards consideration for any service - The issue relating to demand of service tax on income earned by the appellant from registration charges and number plate charges under BAS and freight expenses under GTA has also been decided in favour of the appellant in ROHAN MOTORS LTD. VERSUS C.C.E., MEERUT-I [2018 (7) TMI 29 - CESTAT NEW DELHI].
Appeal allowed - decided in favor of appellant.
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