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Showing 361 to 380 of 16576 Records

• 2021 (12) TMI 1169
  

  Revision u/s 263 by CIT - large increase in sundry creditors with respect to turnover as compared to the preceding year - HELD THAT:- PCIT has accepted the gross receipt of ₹ 2.73 crores and cost of ₹ 2.62 crores while doubting the sundry creditors without even doubting the sundry debtors of like amount. So therefore, according to the Ld. AR the action of the A.O to have accepted the explanation given by the assessee after going through the ledgers of the sundry creditors and sundry debtors as well as the balance sheet as well as profit & loss filed by the assessee is a plausible view, so the Ld. PCIT ought not to have interfered with it.

  We find force in the submissions of Shri S.M. Surana. We find from the discussion supra and after going through the records especially the details of sundry creditors and sundry debtors, we are of considered opinion that the A.O has taken a plausible view in the facts and circumstances of the case. And at any rate the action of the A.O in the given facts cannot be held to be unsustainable in law.

  So, therefore, the action of the A.O in not drawing any adverse inference in respect of sundry creditors in the given facts should not have been interfered by Ld. PCIT exercising his revisional jurisdiction u/s. 263 - the action of the Ld. PCIT to interdict when the A.O has discharged his duty as an investigator as well as that of the adjudicator as discussed above. Since the A.O's action on the facts as discussed is a plausible view, we find merit in the appeal of the assessee and we are inclined to hold that the impugned action of the Ld. PCIT is without jurisdiction and therefore null in the eyes of law so quashed. Appeal of assessee allowed.

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• 2021 (12) TMI 1168
  

  Late remittance of employees' contribution to PF and ESI - Assessee had paid the employees' contribution to PF and ESI prior to the due date of filing of the return u/s.139(1) - HELD THAT:- On identical facts, the Bangalore Bench of the Tribunal in the case of M/s. Shakuntala Agarbathi Company [2021 (10) TMI 1196 - ITAT BANGALORE] by following the dictum laid down by the Hon'ble jurisdictional High Court in the case of Essae Teraoka Pvt. Ltd. Vs. DCIT [2014 (3) TMI 386 - KARNATAKA HIGH COURT], had held that the assessee would be entitled to deduction of employees' contribution to PF and ESI provided that the payments were made prior to the due date of filing of the return of income u/s. 139(1) of the I.T. Act. It was further held by the ITAT that amendment by Finance Act, 2021, to section 36[1][va] and 43B of the Act is not clarificatory.

  The amended provisions of section 43B as well as 36(1)(va) of the I.T. Act are not applicable for the assessment year under consideration. By following the binding decision of the Hon'ble jurisdictional High Court in the case of Essae Teraoka Pvt. Ltd [2014 (3) TMI 386 - KARNATAKA HIGH COURT] the employees' contribution paid by the assessee before the due date of filing of return of income u/s. 139(1) of the I.T. Act is an allowable deduction. Accordingly, we decide this issue in favour of the assessee and the disallowance made by the Assessing Officer is deleted - Appeal filed by the assessee is allowed.

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• 2021 (12) TMI 1167
  

  TP Adjustment - payment of royalty at 4% to be at arm’s length - HELD THAT:- As relying on assessee's own case accepting the payment of royalty at 4% to be at arm’s length, we hold that the payment of royalty at 4% in the year under consideration is to be treated as being at arm’s length. Accordingly ground is allowed.

  Payment of Interest on Compulsory Convertible Debentures - Whether TPO and DRP erred in treating CCDs as ECBs and benchmarked the interest rate against LIBOR rate? - CCDs is a hybrid instrument and cannot be per se treated as ECB / loan - HELD THAT:- In the instant case, admittedly, the CCDs are issued in INR, interest is paid in INR and CCD’s are repaid also in INR. Therefore, placing reliance on the judgment of the Hon’ble Delhi High Court in the case of CIT v. Cotton Naturals (I) Pvt. Ltd [2015 (3) TMI 1031 - DELHI HIGH COURT] we hold that the TP study of the assessee to justify the interest rate by arriving at average rupee cost and comparing the same with SBI prime lending rate is correct. It is ordered accordingly.

  Disallowance u/s 14A computed as per Rules 8D(ii) and (iii) - HELD THAT:- It is an undisputed fact that the assessee did not earn any exempt income during the year under consideration. It is a settled position that in the absence of any exempt income, no disallowance can be made u/s 14A of the Act. See Quest Global Engineering Services Pvt. Ltd. [2021 (3) TMI 434 - KARNATAKA HIGH COURT]

  The Hon’ble Bombay High Court in the case of India Debt Management (P.) Ltd. [2019 (9) TMI 920 - BOMBAY HIGH COURT] has held that when the assessee does not receive any dividend income, no disallowance can be made u/s 14A - thus disallowance made u/s 14A of the Act, ought to be deleted, since the assessee was not in receipt of any exempt income during the relevant assessment year.

  Disallowance of deduction of expenditure as per first proviso to section 40(a)(ia) - HELD THAT:- The assessee is entitled to claim the deduction of expenditure (as per first proviso to section 40(a)(ia) of the Act) in the year the tax on the same has been deducted at source and remitted to the Government account. Therefore, we reiterate the directions to the DRP and remit the matter to the A.O. The A.O. is directed to grant deduction of aforesaid expenditure, if it is found that tax on the same has remitted to the Government account during the relevant assessment year. It is ordered accordingly.

  Disallowance u/s 40(a)(ia) - DRP rejected the claim of the assessee on the ground that the expenses do not pertain to the year under consideration - HELD THAT:- As rightly pointed out by the DRP, the expenditure claimed as deduction does not pertain to the year under consideration. If at all there is an inadvertent offer to tax in the previous year, namely, assessment year 2010-2011, the assessee ought to have taken correctional steps for the assessment concluded for assessment year 2010-2011 and not for the relevant assessment year. There is no statutory provision which provide for claiming amount wrongly shown as income in one year as deduction / expenditure in any subsequent year (unlike first proviso to section 40(a)(ia) whereby the assessee is permitted to claim deduction of the expenditure in the year in which the tax has been deducted on such expenditure and remitted to the Government account). Therefore, we affirm the view taken by the DRP.

  Disallowance of expenditure u/s 40(a)(ia) - assessee suo moto had disallowed a sum for non-deduction of tax at source - AO recharacterized the same as a disallowance u/s 37 - HELD THAT:- AO held the expenditure is not an admissible expenditure u/s 37 - DRP has not adjudicated the issue holding that the objection of the assessee does not arise out of the variation in the returned income. The issue whether the impugned expenditure can be disallowed u/s 37 has not been dealt with either by the AO nor by the DRP. AO has authority to hold that expenditure (though provision expenditure) is not an allowable deduction u/s 37 of the Act. Only those expenditure otherwise allowable u/s 30 to 38 of the Act is deductible as per proviso to section 40(a)(ia) - Therefore, any expenditure not for the purpose of business, the A.O. can certainly re-characterize the same as not allowable expenditure u/s 37 - as mentioned earlier, the A.O. nor DRP has not examined whether the said expenditure is allowable business expenditure u/s 37 - A.O. held that provision disallowed by the assessee u/s 40(a)(ia) of the Act cannot be allowed as deduction in the subsequent assessment year, since, the expenditure does not pertain to the subsequent year. DRP did not adjudicate the issue by observing that there is no variation to the returned income on this count. Therefore, the matter needs to be reconsidered by the AO afresh.

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• 2021 (12) TMI 1166
  

  Late payments towards EPF and ESI u/s 36(1)(va) - payment before furnishing the return of income u/s 139(1) - HELD THAT:- Since the facts involved in the present case are identical to the facts involved in the case of Mohangarh Engineers and Construction Company [2021 (9) TMI 1319 - ITAT JODHPUR] and in the case of Bikaner Ceramics Private Limited, Bikaner[2021 (9) TMI 1319 - ITAT JODHPUR] the impugned additions made by the Assessing Officer and sustained by the Ld. CIT(A) on account of deposits of employees contribution of ESI & PF prior to filing of the return of income u/s 139(1) of the Act, in both the years under consideration prior to the amendment made by the Finance Act, 2021 w.e.f. 1.4.2021 vide Explanation 5, are deleted - Decided in favour of assessee.

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• 2021 (12) TMI 1165
  

  Belated payment of employee's contribution to PF invoking provisions of sec. 36(1)(va) - HELD THAT:- We find merits in the submissions of the assessee, that the payment within grace should be allowed. Therefore, total amount to be allowed within grace period comes to ₹ 31,615/- ( ₹ 15,919 + ₹ 15,696) which are paid by the assessee within the grace period, therefore, addition to the extent of ₹ 31,615/- is hereby deleted and we direct the assessing officer to make the disallowance of the balance amount of ₹ 35,496/- (₹ 67,111- ₹ 31,615). Thus, ground no.1 raised by the assessee is partly allowed.

  TDS u/s 194C - non-deduction of TDS from payment of labour charges - assessee submitted before us that amendment in section 40(a)(ia) of the Act is retrospective in nature therefore disallowance under section 40(a) (ia) should be restricted to 30% of the impugned amount - HELD THAT:- We note that in subsequent judgment of the Hon'ble Supreme Court in the case of Shree Chaudhury Transport Company[2020 (8) TMI 23 - SUPREME COURT] held that amendment in section 40(a)(ia) of the Act is prospective in nature - Issue clearly in the affirmative i.e., against the assessee and in favour of the revenue that the payments in question have rightly been disallowed from deduction while computing the total income of the assessee-assessee.

  Disallowance of interest expenditure u/s 36(1)(iii) - HELD THAT:- As considering all these facts it is crystal clear that assessee has given interest free loan to Mr. Ajay Shah of ₹ 3,00,000/-, out of its interest free funds, therefore addition should not be made. Accordingly, the addition made by A.O. to the tune of ₹ 36,000/- is deleted.

  Addition u/s 68 - HELD THAT:- We note that assessee had furnished the details which would discharge the onus which lay on the assessee. It is not the case of the revenue that the partners of the assessee firm are fictitious. Therefore, addition sustained by ld CIT(A) is hereby deleted.

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• 2021 (12) TMI 1164
  

  Computation of capital gain - determination of deemed sale consideration under section 50C - Change in circle rate in-between the date of agreement and date of registration - CIT(A) accepted contentions of the assessee - HELD THAT:- Section 50C of the Act provides that where the consideration received or accruing as a result of transfer by an assessee of a capital asset, being land or building or both, is less than the value adopted or assessed by any authority for the purpose of payment of stamp duty in respect of such transfer, the value so adopted or assessed shall for the purposes of section 48, be deemed to be the full value of the consideration.

  There is no dispute with regard to the fact that stamp valuation authority has determined value of the property for charging stamp duty at ₹ 5,82,39,975/-, but referring to the fact brought the notice of the ld.Revenue authorities is that the assessee has purchased this property on 17.9.2010 for a consideration of ₹ 24 lakhs. Thereafter, it was converted to non-agriculture land. The assessee has sold the same on 28.9.2011. The assessee had entered into an agreement with M/s.Ashwal Infracon P.Ltd. on 23.12.2010 and sale consideration was settled at ₹ 80.00 lakhs. The assessee has received part payment through account payee cheque. Stamp duty valuation authority have revised their valuation on 1.4.2011, and thereafter vendee was required to pay additional stamp duty of ₹ 24,58,000/-

  In the present case, we find that there are two different dates. One is 23.12.2010 when the assessee entered into an agreement for sale of this property and another 29.9.2011 when the sale deed was ultimately registered. At the time of agreement and prior to that the assessee has received part payments through negotiation. Such payments have been received through account payee cheque. He received ₹ 25 lakhs on 26.2.2011 and ₹ 10.00 lakhs on 13.10.2010. This part payment makes it clear that a valid agreement to sell was executed. Between the date of agreement vis-à-vis ultimate registration of sale deed, the State Government has revised valuation of the property for the purpose of charging stamp duty. This case of the assessee do fall within the first proviso of section 50C of the Act, and this aspect has been dealt with by the ld.CIT(A) elaborately in the finding extracted (supra), therefore, no interference from our side is called in the impugned order on the issue.

  Reopening of assessment u/s 147 - We find that the AO got concrete information about the sale of the property and therefore he has a reason to believe that income has escaped assessment, and has rightly reopened. The ld.CIT(A) has examined this issue elaborately, and has rightly rejected the contentions of the assessee. We do not find any merit in this CO of the assessee

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• 2021 (12) TMI 1163
  

  Revision u/s 263 by CIT - undisclosed income and interest and remuneration paid to the partners - HELD THAT:- We note that Assessing Officer has raised the question during the assessment stage and assessee has replied to the assessing officer along with relevant documents. Thereafter, assessing officer has applied his mind and examined both the issues, viz: undisclosed income and interest and remuneration paid to the partners. Therefore, it cannot be said that the issue has not been examined by the Assessing Officer. Considering this factual position, we note that order passed by the Assessing Officer is neither erroneous nor prejudicial to the interest of Revenue

  Revisionary jurisdiction exercised by the Ld. Pr. C.I.T. u/s. 263 was not in tune with the facts and evidences on record duly explained to the Assessing Officer and verified by him and that being so the order passed u/s 263 of the Act on such erroneous stand is liable to be quashed. Therefore, we quash the order of the ld. PCIT u/s 263 - Appeal of assessee allowed.

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• 2021 (12) TMI 1162
  

  Benami transaction - suit property is ancestral property - Suit property was purchased in the name of grandmother of the plaintiff by grandfather - what was the reason for the defendant to purchase the property in the name of mother and not in his own name? - HELD THAT:- Whether the transaction in question was a Benami and whether the defence of the defendant that in fact he is the exclusive owner and not his mother, though the property was standing in her name, could have been allowed to be raised in view of Section 4 of Benami Transactions (Prohibition) Act, 1988, was not considered by both the Courts below. But, definitely, that point which is the law point, which can be framed here, will have to be gone into because if the defendant could not have been allowed to raise that defence, then his entire defence fails.

  Here, we are concerned with whether defendant can take such defence and to that extent, the observations in paragraph No.13 would be required to be considered. However, since the categories have been made, we will have to consider its interpretation. Further, the real intention whether was brought on record is also a question. Another fact to be appreciated on the basis of the same is, if the property was in the name of mother, then whether defendant could have raised any loan from any institution/bank/ Patsanstha is also required to be considered. On this point, in fact, the Courts below have considered that the said construction would have been made by the defendant as per his choice and will. It does not deprive the plaintiff of his right. The documents on record were considered by both the Courts below and it was observed that those documents appear to be fabricated. The defendant was the Secretary of the Patpedhi, from whom it was shown that he had raised loan. Therefore, as regards factual aspect is concerned, it is not giving any rise to a substantial question of law, however, the nature of the property and whether the defendant could have raised defence of exclusive ownership, though the property stood in the name of his mother, deserve to be resolved/adjudicated in this case. Hence, the second appeal stands admitted. Following are the substantial questions of law :-

  I) What was the nature of the suit property i.e. as to whether ancestral or of exclusive ownership of defendant No.1?

  II) Whether the defendant could have been allowed to take defence that though the suit property was purchased in the name of his mother but he was in fact the real owner (Benami Transactions) in view of Bar under Section 4 of the Benami Transactions (Prohibition) Act, 1988?

  Issue notice to the respondents. Mr. M. S. Kulkarni waives notice for respondent Nos.1 to 3.

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• 2021 (12) TMI 1161
  

  Applicability of the Benami Transactions (Prohibition) Act, 1988 - Single Judge while concurring with the findings of the Trial Court held that under Section 3 (2) of the said Act there was no prohibition to the property being purchased in the name of the ostensible owner's wife and unmarried daughter - Appellants herein are the successors-in-interest of the original Defendant - Single Judge discussed the evidence led and disbelieved the case of the Defendant that the registered sale deed was vitiated by fraud and coercion - HELD THAT:- This Court is unable to come a conclusion different from that reached by the trial Court as well as the First Appellate Court on any of the above issues, in which concurrent findings have been rendered against the Appellants, both by the Trial court as well as the learned Single Judge.

  Indeed, the concept of unilateral cancellation of a sale deed, which has been duly registered, is unheard of. Even otherwise, it lacks legal sanctity. The only way to prove that a sale deed was not duly executed would be by leading evidence in the civil court.

  Despite being provided with sufficient opportunity, the Appellants- Defendants have been unable to establish their case that the registered sale deed in question had been executed through undue influence or coercion.The Court is unable to find any error committed by the learned Single Judge and therefore declines to interfere with the judgment and decree of the Trial Court.

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• 2021 (12) TMI 1160
  

  Rejection of request of provisional release of the goods - import of Black Pepper - prohibited goods or not - whether the value re-determined in the show-cause notice cannot be taken? - HELD THAT:- Even the fact that the final adjudication is yet to be done, we are of the opinion that the respondents are directed to quantify the duty and bond amount and communicate the same to the appellant and release the goods within a week on such remittance by the appellant. The appellant would remit the entire duty if not remitted already and furnish the bond to the satisfaction of the respondents in regard to the interest payable, penalty or charges that may be deemed necessary.

  The condition imposed by the Writ Court is modified regarding to furnish bank guarantee to furnish a bond to the same value. So far as the adjudication is concerned, the authorities are to proceed with the same without being influenced by this order as this order does not express any opinion in that regard.

  Appeal disposed off.

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• 2021 (12) TMI 1159
  

  Maintainability of appeal - Jurisdiction of HC to entertain an appeal against the order of CESTAT - foreign-going vessel or not - scope of eligible order namely the duty of customs - Whether the order under appeal is an eligible order for appeal under Section 130 of the Act or not? - HELD THAT:- It is axiomatic that appeal is a statutory right conferred by Legislature on an aggrieved party. There is no inherent right of appeal to an aggrieved party and, in the case on hand, the right of appeal is covered by Sections 130 and 130E of the Act. The scheme of Customs Act envisages redressal mechanism by way of appeal under Section 128 from primary authority to Commissioner; further from the order of Commissioner to the CESTAT constituted under Section 129; from the order of CESTAT to the High Court under Section 130; or to the Supreme Court under Section 130E. The order of the High Court is again appealable under Section 130E to Supreme Court. An appeal is nothing but a proceeding where a higher Forum reconsiders the decision of the lower Forum on questions of fact and questions of law with jurisdiction authority to confirm, reverse, modify the decision or remand the matter to the lower Forum for fresh decision in terms of its directions. An appeal is a creature of Statute and there is no inherent right of appeal.

  The High Court while taking up an issue on the objection raised on the jurisdiction to maintain the appeal, as contended by respondent, cannot proceed that jurisdiction is conferred by the appellant or that the jurisdiction could be inferred in the circumstances of the matter. But, the principle is jurisdiction should be available. The decisions relied on by the appellant in support of its case that the jurisdiction of this Court cannot be invited to challenge the order under appeal are distinguishable. No decision on the point of foreign-going vessels having precedential value has been brought to our notice - The questions formulated by the appellant or such other questions that may be formulated by this Court under Section 130(3) of the Act, hear the parties and dispose of the appeal. We have taken sufficient care to hear and not advert to any of the circumstances in issue on the main question between the parties, and even reference is made in this order, the same is for the limited purpose of finding out whether this Court ought to proceed with hearing the appeal on merits or not. The question of limitation may also be one of the questions the Court may consider while disposing of the appeal.

  Application disposed off.

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• 2021 (12) TMI 1158
  

  Valuation of imported goods - payment for the services, sought to be included by customs authorities in the assessable value of ‘reactor set’ - enhancement of declared value - suppression of facts or not - invocation of extended period of limitation - penalty u/s 114A of Customs Act, 1962 - HELD THAT:- It is on record that the licence agreement for ‘know-how’ and ‘technical assistance’ and the purchase order for supply of the impugned goods, were both contracted separately with M/s Atofina France. Thereafter, M/s Arcil Catalyst Pvt Ltd, a producer of ‘aluminum chloride anhydrous’ and intending to expand manufacturing capacity, placed order for ‘reactor set’ from M/s Atofina France on 13th December 2000 which was assessed to duty on the contract value of the goods in bill of entry filed on 26th February 2001. Well before this, on 15th September 1999, the ‘licence agreement’ for collaboration in ‘debottlenecking’ of existing process and ‘upgradation’ of facility was entered into; it is the payment due on invoice dated 10th December 2002 for ‘technical knowhow’ and invoice dated 19th December 2002 for ‘technical assistance’ raised by M/s Atofina France in pursuance of the agreement which was sought to be added to assessable value of the goods.

  It would appear to have been assumed that the qualifying expression, ‘as a condition of sale’, in rule 9(1)(c) and 9(1)(e), can be stretched limitlessly to encumber the transaction value of imported goods with any, and all, other outflows of the importer to the seller merely by being so. The mismatched concatenation of facts, contrived for confirming the demand in the impugned order, is mirrored in the confused categorization of the impugned payments under two different, and mutually exclusive, contingencies that permitted inclusion of ‘services’ in assessable value. We cannot accord judicial sanction to a proposition that subsumes all commercial transactions between two entities merely for sharing commercial objective in common with a cross-border transaction in goods. The facts of the case must lead to that conclusion for approval of the proposed addition.

  The payment for the services, sought to be included by customs authorities in the assessable value of ‘reactor set’, became due well after the import and the obligation for providing the ‘technical knowhow’ and ‘technical assistance’ – the services in question – was contingent upon ‘certificate of conformity’ with the basic engineering package or, in other words, the readiness of the facility for ‘debottlenecking’ and ‘upgradation’ in accordance with the agreement. It is seen that this certificate was issued on 13th September 2001 following which the payment contracted in the agreement was made due by M/s Atofina France - The ‘certificate of conformity’ which, according to the adjudicating authority, is the pivot also clearly pertains to provision of service in India after import. None of these facts find fitment within the scheme of taxing of services rendered by an overseas provider at the rate of duty for assessment of imported goods as intended by rule 9 of Customs Valuation (Determination of Price of Imported Goods) Rules, 1988 set out.

  The demand fails along with appeal of Revenue - Appeal allowed - decided in the favor of assessee.

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• 2021 (12) TMI 1157
  

  Approval of the Scheme of Amalgamation - Section 230 to 232 of Companies Act, 2013 read with the Companies (Compromise, Arrangements and Amalgamations) Rules, 2016 - HELD THAT:- Upon considering the approval accorded by the members and creditors of the Petitioner companies to the proposed Scheme, and the report filed by the Regional Director, Northern Region, Ministry of Corporate Affairs, report filed by the official liquidator and the report filed by Income Tax Department and also as no objection from any quarter against the Scheme has been received; there appears to be no impediment in sanctioning the present Scheme.

  The scheme is sanctioned - application allowed.

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• 2021 (12) TMI 1156
  

  Sanction of Scheme of Amalgamation - Sections 230 and 232 and other applicable provisions of the Companies Act, 2013 read with the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 - HELD THAT:- There is no reservation to grant sanction to the Scheme.

  The proposed Scheme of Amalgamation, which is annexed to the Company Petition stands approved and sanctioned. The Petitioner Companies are required to act upon as per terms and conditions of the sanctioned Scheme and the same shall be binding on all the Shareholders, Secured Creditors and Unsecured Creditors of the Petitioner Companies and also on the Petitioner Companies with effect from the Appointed Date, i.e., 1st day of April, 2020.

  Application allowed.

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• 2021 (12) TMI 1155
  

  Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - respondent's case is that the cheque was issued as a security, which clearly indicates that the respondent/corporate debtor had agreed to pay GST additionally over the amount of consideration - HELD THAT:- There is nothing on record to show that the corporate debtor raised dispute over use of said Trademark sold by the applicant. The corporate debtor has failed to demonstrate that the GST was not payable by it, when a cheque for the same purpose was issued. The defense of corporate debtor regarding pre-existing dispute regarding payment of remaining amount is not supported by any documentary proof.

  Since the corporate debtor already-issued a cheque in order to clear its liability towards payment of GST, the claim of applicant deserves to be allowed.

  Application admitted - moratorium declared.

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• 2021 (12) TMI 1154
  

  Approval of Resolution Plan - Section 30(6) of the Insolvency and Bankruptcy Code, 2016 - HELD THAT:- It is noted that CoC in its 18th meeting held on 13.01.2021 with 100% voting right approved the Resolution Plan submitted by the Resolution Applicant. It is also noted that Resolution Applicant is not a related party of the Corporate Debtor. Resolution Applicant has filed an affidavit dated 25.09.2020 regarding its eligibility to submit a Resolution Plan under Section 29A of IBC, 2016. Resolution Applicant has also provided the performance security amounting to ₹ 1,00,00,000 crore as a Bank Guarantee.

  All contents of the Resolution Plan and all documents/compliance certificates as required under Section 30(2) of IBC, 2016 read with Regulations 36 to 39 of CIRP Regulations, 2016 which have been placed on record is perused. The Resolution Plan complies with all these provisions. The total outstanding debt claims by all stakeholders stand at ₹ 11, 209.74 Lakhs and Resolution Applicant has admitted claims totalling ₹ 10,927.29 Lakhs and amount provided under the plan is 1,019.40 which amounts to 9.09%of total outstanding debt.

  The Resolution Plan so approved can be successfully implemented - Resolution Plan approved - application allowed.

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• 2021 (12) TMI 1153
  

  Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - Sub-standard goods or not - HELD THAT:- The Corporate Debtor categorically stated that "the actual amount payable by the Respondent will be ₹ 3,28,800/-. According to the Corporate Debtor, the Oven supplied by the Operational Creditor was defective. It had burst in April, 2019. The fact that the goods were of sub-standard quality was already informed to the Operational Creditor. However, it is difficult for us to accept this defence. It is not in dispute that as per invoice dated 10.08.2018 (page No. 40-45), the goods were supplied. According to the Corporate Debtor, it got burst in April, 2019 i.e. almost seven months after its installation at the premises of the Corporate Debtor. There is every possibility that the Oven got burst due to want of proper maintenance by the Corporate Debtor.

  It is not in dispute that the Corporate Debtor did not reply demand notice under Section 8 of IBC. In earlier notice reply dated 22.05.2019, the Corporate Debtor admitted the debt. Not only that, as per the Corporate Debtor's own statement in reply, it has made payment of ₹ 9,91,200/- and it is ready to pay balance sum of ₹ 3,28,800/-. In such situation the Corporate Debtor's defence that goods received by it was sub-standard cannot be accepted.

  The Corporate Debtor had admitted that operational debt of ₹ 3,28,800/- is yet to be paid by it to the Operational Creditor. It had received demand notice but did not make the payment. This application is defect free - application admitted - moratorium declared.

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• 2021 (12) TMI 1152
  

  Dissolution of the corporate debtor - Section 54 of the Insolvency and Bankruptcy Code, 2016, read with Regulation 14 of Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 - HELD THAT:- It is noticed that since there is no possibility to continue the liquidation process of the corporate debtor in absence of any assets/documents/records and personnel of the corporate debtor. The present case fits in the provisions of Sec. 54 of IBC read with Rule 14 of Liquidation Regulations and it is just and equitable to allow the prayer of the applicant.

  It is hereby declared that not only it is just and equitable but because of the fact that no asset is available for the purpose of 'Liquidation', this is a fit case for order of dissolution. The corporate debtor M/s. Ajaz Nanda Designs Private Limited, stands 'Dissolved' from the date of this Order - Since the Company stands Dissolved vide this order and no proceedings are now pending, therefore the Registry is directed that the case file of proceedings be closed and be consigned to records.

  Application allowed.

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• 2021 (12) TMI 1151
  

  Seeking liquidation of the Corporate Debtor - section 33(1) of the Insolvency & Bankruptcy Code, 2016 - HELD THAT:- RP has filed an application under section 33(1) of the Code, before the Adjudicating Authority for liquidation of the Corporate Debtor and appointment of RP as liquidator who has given his consent to act as liquidator which is placed in the present application. He is stated to have a valid authorization for assignment.

  The Corporate Debtor is ordered to be liquidated in terms of section 33(2) of the Code read with sub-section (1) thereof - Application allowed.

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• 2021 (12) TMI 1150
  

  Liquidation of the Corporate Debtor - Financial debt or not - Resolution Professional rejected the claim stating that the applicant is not a Financial Creditor and that Term Loan Agreement dated 22.03.2017 executed between the applicant and the corporate debtor was novated by the Settlement Deed dated 04.09.2019 - Section 33 (2) of I&B Code - HELD THAT:- The pre-requisite for a debt to qualify as a ‘financial debt’ is that there must be a “disbursal” of money against the consideration for time value of money. The Hon’ble Supreme Court in Anuj Jain IRP for Jaypee Infratech Limited V. Axis Bank Limited [2020 (2) TMI 1259 - SUPREME COURT] has affirmed the above contention by holding that transactions under Section 5(8) would be falling within the ambit of ‘Financial Debt’ only if they carry the essential element of “disbursal”, and that too against the consideration for time value of money.

  The Hon’ble Supreme Court in Pioneer Urban Land and Infrastructure Limited v. Union of India [2019 (8) TMI 532 - SUPREME COURT] has held that for a debt to correspond to the definition of a ‘Financial Debt’ under the Code, there must be “disbursal” which must be a disbursal of money and which must be against consideration for the time value of money. The Hon’ble Supreme Court has conclusively affirmed that there must be actual disbursal of money for a debt to be a financial debt.

  It is clear that the applicant’s claim falls under the preview of Financial Debt as defined under Section 5(8) of I&B Code, 2016, which is disbursed against the consideration for the time value of money - Resolution Professional cannot reject a claim stating that financial debt of the applicant originating from the term loan agreement dated 22.03.2017 is merged with the amount settled under the Settlement Deed dated 04.09.2019 without classifying identity of financial debt. The merger of the financial debt and other multi claims emanating under different business transactions into a single settled amount between the parties are so complex making it impossible to cull out or identify the interfused financial debt from other claims or settled claims. The Resolution Professional cannot deny the claim of the applicant stating that a debt lost its character as a financial debt on the basis of amount settled under the Settlement Deed dated 04.09.2019.

  In the present case, the Interim Resolution Professional acted as an adjudicating authority and gone into the factual scenario between parties and determined their rights and liabilities. The task of the Interim Resolution Professional was to limit itself to confirm that the claims received by him are true and correct. Here, he failed to clear the contingency existed in the amount and to the best estimate of the amount of the claim based on the information available with him. Instead, the Interim Resolution Professional out-rightly rejected the claim of the applicant without verifying the claim.

  The application filed by the Interim Resolution Professional for Liquidation of the Corporate Debtor under Section 33 (2) of I&B Code has been rejected - Application dismissed.

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