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Showing 121 to 140 of 16576 Records

• 2021 (12) TMI 1409
  

  Reopening of assessment u/s 147 - assumption of jurisdiction itself is bad in law - reopening as beyond a period of four years - HELD THAT:- This is purely a question of law which arises for consideration as the reopening is beyond a period of four years and the reasons recorded do not, in any manner, say that there was anything that had been done on the part of the petitioner – assessee which has led to the income escaping the assessment. In absence of failure disclosed fully and truly all material facts, any reopening beyond a period of four years from the end of the assessment year 2014-15 is unsustainable. There is no whisper of the failure of the part of the petitioner of the true and full disclosure in the reasons which have been furnished and therefore, the petitioner has to be considered as a victim and with that being clear in the mind of the revenue also, this notice has been issued, and hence, this requires indulgence.

  The present petition stands disposed of as withdrawn.

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• 2021 (12) TMI 1408
  

  Recovery proceedings - effect of moratorium on proceedings under Section 138 of the Negotiable Instruments Act and on Section 75 (1) of the GST Act - HELD THAT:- A plain reading of Section 14 of the IBC will clearly indicate that there is a complete/total embargo/bar to initiate and continue proceedings against the petitioner before any other authority including the respondent-authority also during the pendency of proceedings before the NCLT and appeal(s) to be filed against the same, if any, when the moratorium/CIRP is in force and has not been lifted; it is relevant state that neither the words 'proceedings' nor 'authority' have been defined under the IBC and consequently giving the said words their plain grammatical meaning, the only inference that arises from a reading of Section 14 would be that the said provision is an all pervasive and omnibus provision which includes and encompasses proceedings initiated by the respondent-department against the petitioner also.

  It is also relevant to state that in P. Mohan Raj's case [2021 (3) TMI 94 - SUPREME COURT], a three Judge Bench of the Apex Court has categorically held that the moratorium provision contained in Section 14 of the IBC would include proceedings under Section 138 of the Negotiable Instruments Act also and by token of the same reasoning, proceedings initiated by the respondent under the GST Act would also attract the embargo contained in Section 14 of the IBC.

  Insofar as the contention urged by the respondent - state with regard to proceedings to be initiated later by the respondent against the petitioner as being barred by limitation is concerned, the said contention cannot be accepted in view of the non-obstante clause contained in Section 60 (6) of the IBC which excludes the entire period during which the moratorium is in force; so also Section 75 (1) of the GST Act also excludes the entire period from 29.09.2021 onwards when this court passed an order of stay up to the date of completion of the CIRP and lifting of the moratorium and as such, even this contention urged by the respondent cannot be accepted.

  All proceedings pursuant to the impugned notices, intimations, orders, etc. issued/passed by the respondent against the petitioner are stayed/suspended/kept in abeyance till disposal of the proceedings before the NCLT, Bengaluru - Petition disposed off.

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• 2021 (12) TMI 1407
  

  Allowable Revenue expenses u/s 37 - Business loss on account of permanent diminution in the value of the investment made in the equity shares in one of the subsidiaries of the assessee in USA - According to the AO this loss was not allowable u/s 37 since the expenditure could not have been considered as a revenue expenditure - HELD THAT:- Tribunal relying on the decisions of the Supreme Court and High Courts noted that under similar circumstances the expenditure incurred by the company were allowed. This was on the basis that the assessee company in order to expand its business world wide had setup subsidiaries in other countries. The investment made in such companies was seen as revenue expenditure since the purpose behind making the investment was only for expansion of the business. Applying this logic to the assessee in the present case, the Tribunal was of the opinion that such investment being in the nature of revenue expenditure was to be allowed under Section 37 of the Act.

  Having perused the order passed by the AO and by the tribunal and having heard learned counsel for the revenue, we find no error in the view expressed by the tribunal. As noted, the assessee had made investment in its subsidiary company in order to expand its business with a view to earn higher profit. The investment was thus driven by business expediency. The tribunal therefore committed no error - No question of law arises.

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• 2021 (12) TMI 1406
  

  Bogus LTCG - Addition u/s 68 - penny stock purchases - exemption u/s 10(38) denied - CIT-A deleted the addition - HELD THAT:- After due consideration of the findings of the learned CIT(A), we do not find any error in it. The shares were purchased long back in 2000-2001 and sold after retaining them for more than 10 years. There is nothing with the Assessing Officer to treat it as a bogus investment to earn profit in a short span of time. Therefore, the appeal of the Revenue is devoid of any merit and, accordingly, it is dismissed.

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• 2021 (12) TMI 1405
  

  Abuse of dominant positions - sale of electricity in the relevant market within the meaning of section 4(2)(a)(i) of the Competition Act, 2002 - whether a prima facie case is made out by the 3rd respondent for initiation of proceedings under the Competition Act or not? - whether there is any scope for the Tamil Nadu Electricity Regulatory Commission to conduct an investigation or impose penalty on the TANGEDCO under the provisions of the Electricity Act or not? - HELD THAT:- In the present case, the Competition Commission of India, considering the allegations raised by the 3rd respondent against the writ petitioner, formed an opinion that it is evident prima facie for the purpose of entertaining a complaint under Section 4 of the Competition Act and ordered for an investigation by the Director General and issued a notice to the TANGEDCO to submit their objections - The impugned notice categorically states that the Commission after considering the available information, is of the opinion that a prima facie case exists and has directed in its order dated 08.10.2013 that investigation be made in the matter by the Competition Commission of India. Thus, in order to enable the Directorate to investigate the matter, in exercise of powers conferred under Section 41(2) read with Section 36(2) of the Competition Act, the informations along with supporting documents were sought for from the writ petitioner/TANGEDCO.

  In the present case, perusal of the allegations raised by the 3rd respondent would reveal that there is a prima facie case that the TANGEDCO/writ petitioner enjoys dominant position in respect of electricity in the State of Tamil Nadu. This factum is not disputed. When the writ petitioner/TANGEDCO is in dominant position, the allegations set out in the complaint indicates certain abuses and therefore, the said abuse of dominant position warrants any further action or not, is to be investigated and all appropriate proceedings are to be allowed for the purpose of forming a final opinion - This Court is not inclined to step-in to the nature of the allegations or its veracity or otherwise, which is yet to be investigated by the Director General under the provisions of the Competition Act. The allegations, which all are not yet investigated by the competent authority, it would be unnecessary for the Court to appreciate such allegations or made a finding, which would cause prejudice to either of the parties, either to proceed with the investigation or to form an opinion for initiation of further actions under the provisions of the Competition Act or to refer the matter to the Electricity Regulatory Commission under the Electricity Act by invoking Section 21-A of the Competition Act.

  Once an anti-competitive practices are brought to the notice of the Competition Commission of India by way of complaint and such allegations are falling under Section 4 of the Competition Act, then the Competition Commission of India is empowered to conduct investigation and form a final opinion for the purpose of initiation of actions. In the present case, the Electricity Act does not provide any power to the Tamil Nadu Electricity Regulatory Commission to conduct investigation, more specifically, with reference to the allegations of abuse of dominant position, which is a specific provision under Section 4 of the Competition Act.

  In the present case, the notice issued to the writ petitioners, calling upon to furnish the informations and documents to conduct investigation is under challenge. Undoubtedly, it is in premature stage, wherein, the authority competent yet to form final opinion with reference to the allegations of abuse of dominant position as contemplated under Section 4 of the Competition Act. When the Competition Act provides jurisdiction to the authorities to entertain complaint, more specifically, when there is no such investigating power contemplated under the Special Act, then there is no impediment for the Competition Commission of India for entertaining a complaint in the present case submitted by the 3rd respondent and thus, there is no infirmity or perversity. Thus, the case on hand is not a fit case for the purpose of quashing the notice. Contrarily, the writ petitioner is at liberty to avail the opportunities provided under the provisions of the Act by the respondents 1 and 2 and defend their case.

  This being the factum established, the writ petition is not only premature, but not entertainable as the challenge made is a notice issued, providing an opportunity to the writ petitioner to defend their case under the provisions of the Competition Act, 2002. The writ petitioner is at liberty to submit their explanations or objections along with the informations and documents to the respondents 1 and 2 within a period of four weeks from the date of receipt of a copy of this order. On receipt of such materials, informations, explanations from the writ petitioner, the respondents 1 and 2 are directed to proceed with the investigations, by affording opportunity to the writ petitioner/TANGEDCO and conclude the investigation and all further proceedings within a period of four months from the date of receipt of a copy of this order. The writ petitioner is directed to co-operate for the investigation for early disposal of the case.

  The writ petition stands dismissed.

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• 2021 (12) TMI 1404
  

  Seeking provisional release of goods - vehicle was seized by the 3rd respondent alleging that the vehicle was imported to India in violation of the Customs Act, and for alleged non payment of customs duty - HELD THAT:- Having considered the submissions as well as the spirit of the order No.S/26-Misc.938/2021- 22/Grp.5(F.I.V) JNCH dated 26.11.2021, this Court is of the opinion that, in view of Ext.P3 and in view of the seizure of the vehicle from petitioner's possession, petitioner can be treated as the owner for the purpose of payment of the amount demanded under the provisional release order. Accordingly, petitioner is permitted to comply with the conditions directed in order dated 26.11.2021 and on such compliance, the vehicle shall be released to the petitioner, to enable him to carry out the registration of the vehicle in his name.

  This writ petition is disposed off.

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• 2021 (12) TMI 1403
  

  TP Adjustment - comparable selection - functional dissimilarity - HELD THAT:- As assessee in engaged in the business of provision of Software Development Services (SWD services) and in development, design and implementation of software programmes. Assessee also acts as consultant on matters relating to IT enabled services to its wholly owned holding company, thus companies functionally dissimilar with that of assessee need to deselected .

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• 2021 (12) TMI 1402
  

  Levy of penalty under Rule 26 of Central Excise Rules, 2002 - Levy of personal penalty on Director - fraudulent availment of cenvat credit without receipt of the inputs - HELD THAT:- it is clear that since the appellant company has fraudulently availed the credit without receipt of the goods, it is not possible without the knowledge of the Director, therefore, the Director is directly involved in the fraudulent availment of credit by his company. Therefore, he is correctly liable for penalty under Rule 26.

  However, the penalty from Rupees Two Lakh to Rupees One Lakh.

  Decided partly in favor of appellant.

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• 2021 (12) TMI 1401
  

  Revocation of cancellation of registration - Revenue is ready to consider the application of the assessee - HELD THAT:- the delay in Petitioner’s invoking the proviso to Rule 23 of the Central Goods and Services Tax Rules (CGST Rules) is condoned and it is directed that subject to the Petitioner depositing all the taxes, interest, late fee and penalty due and complying with other formalities, the Petitioner’s application for revocation will be considered in accordance with law.

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• 2021 (12) TMI 1400
  

  Deduction of marketed-to-market loss - unexpired/unmatured for forex derivative contracts - Whether instruction given by CBDT dated 23.03.2010 can have a retrospective effect thereby negativity the effect of the judgement? - AO held that fees receivable in foreign exchange have been duly hedged by way of taking forward contract and such loss claimed by the assessee is a notional loss and contingent in nature - mercantile system of accounting on regular basis and the loss was recognised in its books of accounts, which is deductible under Section 37[1] - HELD THAT:- As on perusal of the circular, we find that it is not a possible direction by the Board to the AO rather Board under law cannot issue any such possible direction as the settled legal principle. AO is an independent authority and none can dictate him as to how and in what manner he is to complete the assessment. Conscious of this legal position, the Board in the instruction dated 23.3.2010 had stated that the Assessing Officer may follow the guidelines given in the said instruction. This is one more indication to say that the Assessing Officer is not bound over the instruction given by the Board.

  Thus, the only contention of the revenue appears to be based upon instruction issued by the CBDT which cannot override a decision of the Hon’ble Supreme Court. Therefore, we are of the considered view that there is no error in the order passed by the Tribunal. That apart, it is rather doubtful as to whether such instruction given by CBDT dated 23.03.2010 can have a retrospective effect thereby negativity the effect of the judgement.

  Respondent pointed out that identical issue was considered in the case of Principal Commissioner of Income Tax vs. Suzlon Energy Ltd. [2018 (2) TMI 1789 - GUJARAT HIGH COURT] and the Court held that the decision of the Tribunal in so far as deleting the disallowance being notional loss on outstanding foreign derivative contracts was approved by holding that the decision is in-conformity with the decision of the Hon’ble Supreme Court in Woodward Governor India [P] Ltd. & Ors. [2009 (4) TMI 4 - SUPREME COURT]. The revenue had filed a Special Leave Petition in Special Leave which was dismissed by order [2020 (1) TMI 1505 - SC ORDER] dated 17.01.2020. In the case of the same assessee, namely Suzlon Energy Limited, the Hon’ble Supreme Court in Principal Commissioner of Income Tax vs. Suzlon Energy Ltd. [2020 (2) TMI 1559 - SC ORDER] approved the decision of the High Court upholding the order of the Tribunal allowing the assessee’s claim of foreign exchange fluctuation loss on mark to market basis.

  We find no grounds to interfere with the order passed by the Tribunal. Decided against the revenue.

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• 2021 (12) TMI 1399
  

  Revision u/s 263 - Section 115JB of the Act applicability with respect to the disallowance u/s 14A - Tribunal held that Section 14A disallowance amount cannot be added to assessee's income for the purpose of computation of income under Section 115JB relying upon the decision of Vireet Investment (P) Ltd. [2017 (6) TMI 1124 - ITAT DELHI] and also holding that issue of debatable and as such the CIT ought not to have taken up for revision under Section 263 - HELD THAT:- As Respondent submits that the issue, in as much as Section 115JB of the Act whether applicable with respect to the disallowance under Section 14A of the Act, is already covered on merits and as such examining the question whether CIT (Appeals) had jurisdiction to invoke Section 263 of the Act would render academic. No substantial question of law arises.

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• 2021 (12) TMI 1398
  

  Reopening of assessment u/s 147 OR 153C r.w.s. 153A - additional grounds - As argued no failure on the part of the assessee to disclose fully and truly necessary facts for completion of the assessment - HELD THAT:- The assessee has raised additional grounds for both the assessment years. The issue raised in the additional grounds is that the assessment completed u/.s 147 r.w.s. 143 of the Act is bad in law. The contention of the assessee is that there was a search in the premises of M/s.Davanam Jewellers Private Limited and during the course of search, there were certain material found pertaining to the assessee. Assessment orders for A.Y. 2006-2007 and A.Y. 2007-2008 ought to have been completed u/s 153C r.w.s. 153A of the Act and not u/s 147 r.w.s. 143(3) of the Act

  The issue raised in the additional grounds, namely, whether the assessment is to be completed u/s 147 or 153C of the Act has not been raised before the Income Tax Authorities. The issue raised in additional grounds is a jurisdictional issue, which goes to the root of the matter.

  Therefore, in the interests of justice and equity, we deem it appropriate, the same needs to be adjudicated first by the Income Tax Authorities. Accordingly, we restore the issue raised in the additional grounds to the files of CIT(A). At this point, we refrain from adjudicating the issue on merits. In the event, the CIT(A) decide the issue raised in additional grounds against the assessee, needless to state that the assessee is at liberty to file a fresh appeal raising all the issues raised in the original grounds and the additional grounds.

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• 2021 (12) TMI 1397
  

  Late filing fee u/s 234E - default in furnishing statements - Intimation u/s 200A - HELD THAT:- Learned counsel for the petitioner brought to my attention the decision in M/s.Sarala Memorial Hospital v. Union of India and Another [2018 (12) TMI 1818 - KERALA HIGH COURT] wherein an identical question arose for consideration. After considering the statutory provisions and the implications of the amendment brought into the Act, it was held that the amendment would take effect only from 1st June, 2015 and is thus prospective in nature. It is submitted that the aforesaid judgment has become final and is binding upon the authorities.

  The demand for late fees for the period till the first quarter of the assessment year 2015-16 is without authority. The demand in Ext.P1 to Ext.P15 intimations for the period from 2012-13 to the first quarter of assessment year 2015-16 is bereft of authority and cannot be legally sustainable.

  Accordingly, we quash Ext.P1 to Ext.P15 intimations to the extent it demands late fee under section 234E for the period from 2011-12 till 01.06.2015.

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• 2021 (12) TMI 1396
  

  Contempt proceedings - disobedience of the order passed by this Court - suppression of material facts - It appears that though eight Suits filed by one Hero Cycles Limited were pending and still the same was not disclosed before this Court - applicability of provisions of the Contempt of Courts Act - HELD THAT:- On considering the fact that Respondent No.1 has agreed that on deposit of the entire balance sale consideration of Rs. 8,35,00,000/- by the petitioners herein - original plaintiffs which may be deposited with the Commercial Court, Ludhiana and the Respondent No.1 may not be permitted to withdraw the same till the outcome of the aforesaid Suits and subject to the ultimate outcome of the aforesaid Suits and on such deposit, the respondent(s) shall execute the Sale Deed in favour of the petitioners - original plaintiffs and handover peaceful and vacant possession. It is reported that respondent is personally present in the Court and the aforesaid statement is made in his presence and he has also agreed to the aforesaid and the order which is being passed.

  The Commercial Court, Ludhiana are directed to invest the aforesaid amount to be deposited by the petitioners, as observed herein above, in the name of the Respondent No.1 herein – original Defendant Nos. 2 & 3 in a Fixed Deposit in any nationalized Bank and the same shall be appropriated subject to the ultimate outcome of the aforesaid Commercial Suits. If the aforesaid Suits are decreed in favour of the original plaintiffs - Hero Cycles Limited and in case the Commercial Court holds in favour of the respondent No.1 herein, in that case, subject to the order that may be passed by the DRT-II Chandigarh, if any, the said amount be paid to the Respondent No.1.

  The Respondent No.1 herein and the learned counsel appearing on behalf of the Respondent No.1 has handed over the original Title Deeds/documents in favour of the Respondent No.1 to the learned counsel appearing on behalf of the petitioners and the learned counsel appearing on behalf of the petitioners are satisfied with respect to the title of the Respondent No.1 and has stated at the Bar that they have no objection if the Sale Deed is executed by the Respondent No.1 on the basis of the Title Deeds/documents mentioned in the file and that they are satisfied with the title of the Respondent No.1 - present proceedings are closed.

  Petition disposed off.

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• 2021 (12) TMI 1395
  

  Smuggling - Heroin - Conspiracy - joint possession punishable under Section 21(c) of the NDPS Act - HELD THAT:- The submission of the Additional Solicitor General that offences under the NDPS Act are of a serious nature is appreciated and the case is at the post conviction stage. Yet the Court cannot be unmindful of the fact that the appellant has undergone 8 years out of the total sentence of 10 years. The appeal is unlikely to be heard early. In all probability, the entire sentence would have been undergone by the time the appeal is heard.

  In the circumstances, particularly, since the appellant has undergone 8 years out of ten years of the total sentence which has been imposed on him, we are of the view that a fit and proper case has been made out for the suspension of the sentence under Section 389 CrPC.

  The impugned order of the High Court is set aside - the sentence of the appellant shall remain suspended under Section 389 CrPC, subject to such terms and conditions as may be imposed by the Special Judge, NDPS, Patiala House Courts, New Delhi - appeal allowed.

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• 2021 (12) TMI 1394
  

  Assessment u/s 153C - HELD THAT:- An assessment is valid even in absence of the foregoing incriminating material. Their lordships rather observe that whilst framing an assessment u/s 153A / 153C, AO is nowhere barred from taking cognizance of any other material as well.

  Whether the assessee’s return(s) in issue would be treated as invalid being belated ones or not ? - Our reply is negative in assessee’s favour and against the department. This is because of the fact that the assessee had filed its return(s) under the Income Declaration Scheme, 2016 on 04.08.2016 followed by the search in issue dt.04.07.2017. Revenue’s argument that it had not filed any return in the corresponding assessment year u/s 139(1) we are of the opinion that the decision as to whether the income sought to be added as under the head “undisclosed income” has to be seen on the date of search only which purely stands satisfied in the facts of instant appeal. We further wish to observe here that the assessee’s returns filed under 2016 scheme stands stood duly accepted as there is no ground in Revenue’s pleadings to the contrary.

  CIT-DR lastly contended that the assessee had not disclosed its IDBI bank account in the computation corresponding to the alleged returns filed in the year 2016 - We find no substances in the instant last argument as well since a perusal of the corresponding account documents indicate that the same had been opened only on 05.08.2016 and therefore, it could not be treated as an undisclosed bank account in assessment years 2010-11 to 2016-17 to say the least. So far as the last A.Y. 2017-18 is concerned, it is made clear that the relevant proceedings therein are in the search year itself only. We therefore decline the Revenue’s foregoing arguments in light of all the relevant facts and circumstances forming part of record before us. Revenue’s five appeals seeking to reverse the CIT(A)’s identical action quashing the impugned section 153C assessments fail accordingly.

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• 2021 (12) TMI 1393
  

  CENVAT Credit - input services - Group Mediclaim Insurance - Group Personal Accident Insurance - Insurance on Commercial Vehicle - Insurance on Contractor’s Plant & Machinery - Insurance on Private Cars - period 2011-12 - Rule 2(l) of the Cenvat Credit Rules, 2004 - credit denied on the ground that under the amended definition of Input Service, Group Mediclaim and Group Accident Policies were specifically excluded for consideration as input service.

  Group Mediclaim Insurance - Group Personal Accident Insurance - HELD THAT:- The CBEC vide Circular No.943/4/2011-CX dated 29.04.2011 had clarified that if the provisions of service had been completed before 01.04.2011, the credit on such services should be available even if the credit particulars are entered in the Cenvat register after amendment of the definition of input service. Since, on this specific issue, the CBEC has clarified regarding entitlement of credit after the period 01.04.2011 for the services availed prior to such date, the impugned order passed by the Commissioner (Appeals) is denying in Cenvat benefit cannot be sustained. Therefore, the impugned order denying the Cenvat benefit on Group Mediclaim Insurance, Group Personal Accident Insurance, is set aside and the appeal to such extent is allowed in favour of the appellant.

  Commercial Vehicle - Insurance on Contractor’s Plant & Machinery - Insurance on Private Cars - HELD THAT:- The appellant did not press for the stand taken in this appeal for allowing the cenvat benefit. Thus, there are no infirmity in the impugned order insofar as the credit on those services was denied to the appellant. Accordingly, the appeal of the appellant to such extent is dismissed.

  The appeal filed by the appellant is partly allowed.

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• 2021 (12) TMI 1392
  

  Appealable order - Section 107 of the Central Goods & Services Tax Act, 2017 - HELD THAT:- The revisional application under Article 227 of the Constitution of India assailing the said order is not maintainable.

  Order is dismissed as such without any order as to costs.

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• 2021 (12) TMI 1391
  

  Disallowance of interest on belated payment of non compete fees - CIT-A deleted the addition - as per AO CIT(A) erred in deleting disallowance of interest paid on non-compete fees without appreciating the fact that said expenditure is capital in nature and not to be allowed as revenue expenditure by specific legislative mandate vide section 28(va) - HELD THAT:- We find that the Ld. CIT(A) has deleted additions made by the AO towards disallowance of interest paid on belated payment of non-compete fees by following the decision of ITAT, Chennai Benches in assessee’s own case for assessment year 2000-01 where it was clearly held that liability to pay interest was contractual obligation and thus, the same is allowable expenditure u/s. 37(1) of the Act. The fact remains unchanged. The Revenue fails to bring on record any contrary judgments to counter findings of the Ld. CIT(A). Hence, we are inclined to uphold the findings of the Ld. CIT(A) and reject the ground taken by the Revenue.

  Disallowance of sales promotion expenses - assessee has claimed deferred revenue expenditure being 1/5th of total expenditure incurred for marketing expenses for product launch - AO has disallowed deferred revenue expenditure on the ground that, except as provided for amortization of expenses u/s. 35D, 35DD etc, no deduction can be allowed to other expenses - HELD THAT:- CIT(A) has allowed deduction claimed by the assessee towards expenditure incurred in the impugned assessment year by holding that once it has admitted fact that expenditure has been wholly and exclusively incurred for the purpose of business, then the same needs to be allowed as deduction as and when such expenditure has been incurred for the purpose of business. To this extent, we do not find any infirmity in the findings recorded by the Ld. CIT(A).

  As regard the ground taken by the Revenue in light of the decision in the case of Goetz India Ltd. [2006 (3) TMI 75 - SUPREME COURT] we are of the considered view that restrictions imposed by the Hon’ble Supreme Court on the powers of Assessing Officer does not extend to the powers of appellant authority. The appellant authority itself entitles to admit any new claim even though such claim was not made before the AO by filing revised return of income. Therefore, we are of the considered view that there is no error in the reasons given by the ld. CIT(A) to entertain fresh claim made by the assessee in so far as deduction of total expenditure incurred for sales promotion activities. For all these reasons, we do not find any reason to interfere with the findings recorded by the Ld. CIT(A) and hence, we reject ground taken by the Revenue.

  Computation of deduction u/s. 80HHC - Exclusion of excise duty/sales tax from total turnover for the purpose of computation of deduction u/s. 80HHC - HELD THAT:- We find that the Hon’ble Supreme Court in the case of Lakshmi Machine Works [2007 (4) TMI 202 - SUPREME COURT] had considered an identical issue and held that excise duty/sales tax are not included in total turnover in the formula contended in section 80HHC(3) - CIT(A) after considering relevant facts and also by following the ratio laid down by the Hon’ble Supreme Court has directed the AO to exclude excise duty/sales tax from total turnover for computation of deduction u/s. 80HHC. The fact remains unchanged. The Revenue fails to bring on record any contrary judgments to support its arguments. Therefore, we are inclined to uphold the findings of the Ld. CIT(A) and reject ground taken by the Revenue.

  Exclusion of DEPB license fees received from Government of India for computation of deduction u/s. 80HHC - HELD THAT:- We find that the issue is squarely covered in favour of the assessee by the decision of the Hon’ble Supreme Court in the case of Topman Exports vs CIT [2012 (2) TMI 100 - SUPREME COURT] where the Hon’ble Supreme Court clearly held that profit from transfer of DEPB license is entitled for deduction u/s. 80HHC - CIT(A) after considering relevant facts, and also by following the decision in the said case has directed the AO to recompute deduction u/s. 80HHC of the Act by considering profit from sale of DEPB license. We do not find any error or infirmity in the order of the Ld. CIT(A) and hence, we are inclined to uphold findings of the Ld. CIT(A) and reject grounds taken by the Revenue.

  Disallowance of PE/ESI contribution on the ground that same cannot be allowed as deduction u/s. 43B - HELD THAT:- As assessee has paid employees’ contribution to PF and ESI on or before due date for filing return of income and thus, deleted addition made by the AO. We do not find any error in the reasons given by the Ld. CIT(A) to delete addition made towards disallowance of employees’ contribution to PF and ESI. Hence, we are inclined to uphold the finding of the Ld. CIT(A) and reject the ground taken by the Revenue.

  Re-computation of deduction u/s. 80HHC based on book profits - AO has computed deduction u/s. 80HHC of the Act while computing book profit u/s. 115JB by taking into account profits and gains from business computed after making certain adjustments - HELD THAT:- We find that this issue is squarely covered in favour of the assessee by the decision of Hon’ble Supreme Court in the case of Ajanta Pharma Ltd [2010 (9) TMI 8 - SUPREME COURT] where the Hon’ble Supreme Court has clearly held that for the purpose of computing book profit, in terms of section 115JB, net profit as shown in profit and loss account have to be reduced by amount of profits eligible for deduction u/s. 80HHC and not by amount of deduction u/s. 80HHC of the Act.We find that this issue is squarely covered in favour of the assessee by the decision of Hon’ble Supreme Court in the case of Ajanta Pharma Ltd vs CIT, (supra), where the Hon’ble Supreme Court has clearly held that for the purpose of computing book profit, in terms of section 115JB, net profit as shown in profit and loss account have to be reduced by amount of profits eligible for deduction u/s. 80HHC and not by amount of deduction u/s. 80HHC of the Act.

  Include foreign exchange gain as part of the turnover for computing deduction u/s. 80HHC

  Additions made by the AO towards estimation of interest on loans given to sister concern.

  TDS u/s 195 - disallowance of foreign agency commission u/s. 40(a)(i) - export commission paid to foreign agency without deducting TDS - HELD THAT:- In this case, on perusal of facts available on record, it was very clear that commission paid by the assessee to non-resident for procuring export orders is neither accrued in India nor taxable u/s. 9 of the Act as fees for technical services. Further, the business profits of a non-resident cannot be taxed in India unless such non-resident have permanent establishment in India. It was not the case of the AO that foreign agents have permanent establishment in India. Therefore, we are of the considered view that export commission paid to foreign agents cannot be disallowed u/s. 40(a)(i) of the Act, for non deduction of tax at source u/s. 195 of the Act. The Ld. CIT(A) after considering relevant facts has rightly deleted additions made by the AO. Hence, we are inclined to uphold the findings of the Ld. CIT(A) and reject ground taken by the Revenue.

  Disallowance of foreign exchange fluctuation loss - HELD THAT:- We find that the Ld. CIT(A) has recorded categorical finding that the assessee had added back this item of expenditure as prior period expense being part of inadmissible items in the computation of total income for the assessment year 2010-11. The Ld. CIT(A) further recorded factual finding that once assessee itself has disallowed said item of expenditure by holing that it does not pertain to year under consideration, then no addition can be made towards said expenditure. Fact remains unchanged. The Revenue fails to bring on record any evidence to counter findings of fact recorded by the Ld. CIT(A). Hence, we are inclined to uphold the findings of the Ld. CIT(A) and reject ground taken by the Revenue.

  Disallowance u/s 14A r.w.r. 8D - CIT-A deleted the addition - HELD THAT:- If no exempt income for the relevant assessment year, then no disallowance can be made by the AO towards expenditure u/s. 14A r.w.r. 8D of the Act, for assessment years 2011-12 & 2012-13. The CIT(A) after considering relevant facts has rightly deleted addition made by the AO u/s. 14A of the Act. Hence, we are inclined to uphold the findings of the ld. CIT(A) and reject the ground taken by the Revenue.

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• 2021 (12) TMI 1390
  

  Blocking of the input tax credit - Constitutional validity of clause (b) of sub-rule (2) of Rule 86 of GST Rules, 2017 - time limitation for imposing restriction - main thrust of the advocate for the petitioner at this stage was that in terms of sub-rule (3) of the said Rule 86A in any case upon expiry of a period of one year from the date of imposition of restriction, the same would no longer survive - HELD THAT:- In view of the statement made by the Counsel for the respondents, it is not necessary to go into the question of continuing the restriction imposed on the petitioner enjoying the input tax credit in question. If this unblocking of the tax credit is not already reflected on the GST portal in the account of the petitioner, the same shall be done forthwith.

  Petition disposed off.

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