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Showing 101 to 120 of 1278 Records
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2014 (11) TMI 1181 - SC ORDER
Waiver interest under Sections 234A, 234B and 234C - Settlement Commission directed that interest under Sections 234A and 234C, wherever applicable was to be charged as per law and interest chargeable under Section 234B would be charged upto the date of order passed under Section 245D(1) and that interest under Section 220(2), applicable on the sustained demand outstanding as on various dates would be charged upto the date of the order passed by the Settlement Commission - Held that:- The learned counsel for the petitioners seeks leave to withdraw this Special Leave Petition so as to approach the Income Tax Settlement Commission for an appropriate remedy.
Permission is granted with the above liberty.
The Special Leave Petition is, accordingly, disposed of as withdrawn.
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2014 (11) TMI 1180 - MADRAS HIGH COURT
Sale of undivided share of Land by the Sister unit - dishonor of Cheque for want of sufficient funds - Section 55(4)(b) of the Transfer of Property Act, 1882 - Held that:- Initially the defendant misled the District Consumer Forum by false complaint and obtained an order. When the plaintiff filed a civil suit for recovery, the defendant again made a serious attempt before the civil Court by producing Ex. B3/forged receipt to show as if she had paid ₹ 3,19,970/- to the plaintiff. Clear findings have been given by the trial Court that the defendant had marked the forged receipt under Ex. B3 to disprove and defeat the plaintiff's case and claim.
When a party approaches the High Court, he/she must place all the facts before the Court without any reservation and if there is a false statement or a twisted fact placed before Court, then the Court should not hesitate to curb such practice by imposing exemplary costs, in the present case, when the defendant made a false story before the District Consumer Forum against the plaintiff that she had paid a huge amount of ₹ 3,19,970/- under Ex. B3 a forged document and attempted to deceive the abovesaid amount, this Court is of the considered view that she should be made to pay the same amount to the plaintiff, accordingly, the defendant is directed to pay a sum of ₹ 3,19,970/- under Ex. B3 to the plaintiff within a period of four weeks from the date of receipt of a copy of this order.
Appeal allowed.
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2014 (11) TMI 1179 - KARNATAKA HIGH COURT
Orders prejudicial to the interest of revenue u/s 263 - Held that:- where two views are possible, and merely because the revisional authority did not like the view taken by the assessing authority, there is no ground for interfering u/s 263 - also where the order passed by AO is not prejudicial to the interest of the revenue, the question of exercising the power under section 263 does not arise - Decided in favor of assessee.
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2014 (11) TMI 1178 - KARNATAKA HIGH COURT
Penalty u/s 78 - respondent has paid the tax before the issuance of the SCN - Held that: - the department has introduced voluntary disclosure scheme where if the assessee has paid tax voluntarily the entire interest is waived let alone the penalty - penalty set aside - appeal dismissed - decided against Revenue.
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2014 (11) TMI 1177 - ITAT MUMBAI
Minimum Alternate Tax (MAT) on SEZ units - Applicability of provisions of section 115JB on unit located in Speical Economic Zone - Income relating to 10A unit as includible in the book profit - Held that:- As decided in Genesys International Corporation Ltd. v. ACIT (2012 (12) TMI 491 - ITAT MUMBAI) that a unit located in Speical Economic Zone (in short SEZ) is covered by sub section (6) of section 115JB irrespective of the fact that such unit is claiming deduction u/s 10A and, therefore, the book profit of the SEZ unit could not be included while computing book profit under section 115JB for A.Y. 2008-09, despite the fact that clause (f) of Explanation 1 to section 115JB(2) has been amended to apply the provisions of MAT to units which are entitled to deduction under section 10A. - Decided in favour of assessee.
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2014 (11) TMI 1176 - ITAT MUMBAI
Revision u/s 263 - valuation of the plot by DVO u/s 55A((b)(ii)- Held that:- As observed by us that the assessment was framed subject to valuation by the DVO. This, by itself is a deficiency in the order under section 143(3).
The proposal was received by the CIT from the AO, which clearly means that there has been no independent application of mind by the CIT - Since the proceedings got in the infirmity zone at the first stage, it is not necessary for us to proceed further on merits. - Decided in favour of assessee.
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2014 (11) TMI 1175 - ITAT MUMBAI
Penalty u/s 271(1)(c) - Provision for leave encashment u/s 43B disallowed - Held that:- There is merit in the contentions of the assessee. The claim of provision for leave encashment is otherwise allowable as deduction, but for the specific provisions of sec. 43B. Thus, the said claim could not be substantiated in law. Hence, the decision rendered by Hon’ble Supreme Court in the case of Reliance Petro Products (P) Ltd [2010 (3) TMI 80 - SUPREME COURT] shall squarely apply to this claim. In respect of Project expenses, the question whether it was capital expenditure or revenue expenditure is, as submitted by Ld A.R, is a debatable question. It is well settled principle that the penalty u/s 271(1)(c) shall not lie in respect of such deductions, which are debatable in nature. Accordingly, we are of the view that the impugned penalty order could not be sustained. - Decided in favour of assessee
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2014 (11) TMI 1174 - ITAT DELHI
Disallowance u/s 14A - Held that:- CIT(Appeals) has given a factual finding that no interest expenditure was incurred for earning taxable income. Loan was from the government and it was for working capital assistance. Interest was paid on delayed payment of electricity bills, PF and ESI dues and interest to Selling Agents on the security deposits, interest to employees on the security deposits etc. This factual finding could not be controverted by the Ld.CIT, D.R. Thus the deletion of the disallowance of ₹ 1,07,82,277/- by the FAA is upheld. The third element is disallowance of other indirect expenses under Rule 8D(2)(iii). AO’s finding has been upheld by the Ld.CIT(A) and hence there is no grievance to the Revenue. In the result this ground of the Revenue is dismissed.
Disallowance of prior period expenses - Held that:- The assessee has incurred prior period expenses of ₹ 16,61,43,508/-. It had prior period income of ₹ 10,22,60,782/-. The net prior period amount of ₹ 63,88,272/-, was already added by the assessee in the computation of income. Thus, the finding of the First Appellate Authority that there is a double addition of ₹ 63,88,272/- is factually correct.
As far as the balance amount is concerned the assessee’s contention is that the amount has crystallised during the year, as the assessee came to know about these expenses only in the F.Y. 2008-09. 7.4. The second limb of the argument of the assessee is that, which has been consistently following the policy of netting out prior period income with prior period expenses and the net effect was disclosed in the computation of income. It was also submitted that such a treatment was accepted by the Revenue for the AY 2007-08 and 2008-09. First Appellate Authority has, on the principle of consistency, accepted the contentions of the assessee.
Disallowance of foreign exchange fluctuation loss - Held that:- The assessee claimed foreign exchange fluctuation loss under the head “financial charges” in the Profit and Loss a/c. Admittedly the foreign exchange fluctuation loss pertains to the rate difference arising on account of purchase of plant and machinery. The disallowance was upheld by the FAA. The alternative contention of the assessee was that the foreign exchange rate difference goes to increase the cost of plant and machinery as per provisions of S.43A read with S.32(1)(ii) and (ii a) of the Act. CIT(A) directed grant of depreciation @ 15% and an additional depreciation @ 20%. This finding could not be controverted by the Ld.CIT,DR. Thus the same is upheld.
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2014 (11) TMI 1173 - BOMBAY HIGH COURT
Income accrued in India - presence of the Assessee in India is through an agent - PE in India - DTAA benefits - Held that:- The Tribunal has rightly observed that even during the course of the proceedings before it, no material was placed on record, which would prima facie demonstrate or even indicate that the transactions between the principal namely the Assessee and the agent are not under at arm's length conditions. Once this onus is not discharged by the Revenue and the Tribunal has confined its observations and conclusions to the facts and circumstances peculiar to the Assessee's case and for the particular assessment year, then, we agree with Mr. Irani that this Appeal does not raise any substantial question of law.
However, we do not find any basis for the submission made by Mr. Singh that the Tribunal should have examined the matter in the light of applicability of Article 5(1)(2) of the DTAA. The departmental representative has given up that because there was no finding rendered by the Assessing Officer. The Tribunal as rightly held was not obliged to go into the same. Even on this ground the Tribunal's order cannot be faulted.
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2014 (11) TMI 1172 - KARNATAKA HIGH COURT
Entertainment Tax - nature of the exhibition conducted by the petitioner - Held that: - The exhibition conducted by the petitioner included live fashion show by designers which according to the petitioner, is not an entertainment but promotion where instead of mannequins, it was demonstrated by live models - There is a statutory appeal available to the petitioner before the Karnataka Appellate Tribunal on the order of the Joint Commissioner of Commercial Taxes. The petitioner has to exhaust his remedy before the Karnataka Appellate Tribunal before he approaches this Court - petition disposed off.
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2014 (11) TMI 1171 - ITAT AMRITSAR
Estimation of net profit rate of 5% - Held that:- The accounts of the assessee are undisputedly audited accounts. These were produced before the A.O. The balance-sheet, trading and profit & loss account are required to be necessarily furnished along with the return of income. So, obviously, these were also available before the A.O. Thus, even if the books of account were rejected and an estimate was made, this estimate, as arrived at by the learned CIT(A) on the basis of ‘M/s Bathinda Wine Traders’ for the assessment year 2009-10, in the absence of any other comparable case supporting the estimate of net profit rate of 5%, is squarely applicable and has rightly been applied by the learned CIT(A). - Decided against revenue
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2014 (11) TMI 1170 - ITAT KOLKATA
Delay in payment of employees’ contribution to the Provident Fund - Held that:- As it is noticed that the employees’ contribution to the Provident Fund has been paid before the due date of filing of the return as also before 31st March, 2008, in view of the decision of the Hon’ble Jurisdictional High Court in the case of Vijay Shree Limited [2011 (9) TMI 30 - CALCUTTA HIGH COURT] the disallowance as made by the Assessing Officer and as confirmed by the ld. CIT(Appeals) stands deleted.- Decided in favour of assessee.
Disallowance of 20% of the expenses under the head "carriage inward", "carriage outward", "loading & Unloading expenses" and "labour charges" - independent verification could not be made to find out the authenticity of these expenses - Held that:- No estimated disallowance can be made for inability to make independent verification. If any specific expenditure is unverifiable or is un-vouched, then such specific expenditure is disallowable. Here no such specific identification has been done. In these circumstances, we are of the view that the estimated disallowance as confirmed by the ld. CIT(Appeals) is unsustainable. Consequently the same stands deleted - Decided in favour of assessee.
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2014 (11) TMI 1169 - CALCUTTA HIGH COURT
Disallowance u/s 14A - Held that:- Tribunal has erred in law in upholding the order of CIT (Appeals) restricting the disallowance under section 14A from ₹ 2,20,15,787/- to ₹ 5,47,433/- relying on the decision of Godrej & Boyce manufacturing Ltd. vs. CIT (2010 (8) TMI 77 - BOMBAY HIGH COURT)
Disallowance u/s 14A not to be considered for book profit for calculation of book profit u/s 115JB - Held that:- We accept the submission of assessee that the provision of section 115JB in the matter of computation is a complete code in itself and resort need not and cannot be made to section 14A of the Act.
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2014 (11) TMI 1168 - ATPMLA
Provisional Attachment Order - offence under PMLA - corroborative evidence to conclude that the borrower company is involved in any manner with the proceeds of crime and that the borrower company has not committed any scheduled offence and is not involved in laundering of proceeds of crime of Mr. Madhu Koda - Held that:- Normally if the Adjudicating Authority has power to give an opportunity of hearing to a person whose properties have been attached and to whom the notice under Section 8(1) of the Act has not been given, such a person should normally approach the Adjudicating Authority and show and demonstrate prima facie his rights in the properties which have been attached and thereafter, he will be entitled for hearing as to why the properties which have been attached be released from attachment. Though the connotation of word ‘aggrieved’ under Section 26 may be very wide and may include even the appellant, however, it may not be appropriate to entertain the appeal of the appellant in the facts and circumstances. Therefore, in the present facts and circumstances it is incumbent upon the appellant to approach the Adjudicating Authority to seek the relief claimed by the appellant, in case the appellant has any right on the properties which have been attached by the respondent.
Therefore, the appropriate remedy of the appellant is to invoke the power of Adjudicating Authority to hear the appellant. In case the appellant files an appropriate application before the Adjudicating Authority, the appellant will be liable to prima facie satisfy the Adjudicating Authority that it has the rights in the properties which have been attached. The Adjudicating Authority will determine, in case the appellant approach the Adjudicating Authority, whether the appellant, prima facie has any rights or lien on the properties which are sought to be attached and thereafter on being satisfied about the right of the appellant to give hearing to the appellant as contemplated under proviso to Section 8(2) of the Act.
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2014 (11) TMI 1167 - ITAT, MUMBAI
Interest earned on money lent by the assessee - income from "Profit and Gains of Business or Profession" OR "income from other sources" - Held that:- Considering the commonness of the issue involved in the present appeal with that of the issue decided by the Tribunal in assessee‟s own case for the AY 2008-2009 we are of the opinion that the decision of the CIT (A) holding that the interest earned on money lending operation arose from a systematic and organized activity carried on with a motive of profit and hence ought to be taxed under the head "profits and gains of business or profession" is fair and reasonable and it does not call for any interference
Disallowance u/s 14A - Held that:- The disallowance confirmed by the CIT (A) is proper but the same is subjected to the correctness of the calculations as per clause (ii) & (iii) of Rule-8D(2) of the IT Rules, 1962. Assessing Officer may examine the correctness before restricting the disallowance as held by the CIT (A). Therefore, in substance, the order of the CIT (A) does not call for any interference. - Revenue appeal dismissed.
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2014 (11) TMI 1166 - ALLAHABAD HIGH COURT
Recovery of alleged dues - Whether, in view of these facts, it would be appropriate for the Court to entertain these proceedings under Article 226 by issuing a mandamus for the payment of seven bills stated to be totaling an amount of ₹ 2.65 crores?
Held that: - once a serious matter relating to the evasion of service tax is alleged and drawn to the notice of the first respondent by the revenue authorities and the first respondent has been informed both of the pending investigation as well as to disclose documentary material, it cannot be held that the claim falls within that category where it can be ascertained that there is absolutely no defence or that a mandamus would be warranted - this is not a fit and proper case for exercising the discretion by the Court under Article 226 to entertain a petition seeking a mandamus for the payment of bills and the petitioner ought to be relegated to the ordinary civil remedy.
Petition dismissed.
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2014 (11) TMI 1165 - GUJARAT HIGH COURT
Recognition under Section 80G(5) - proof of charitable activities - examination of extent and nature of activities - Held that:- It is well settled position of law that at the time of granting approval under Section 80G of the Act, what is to be examined is the object of the trust and so far as the aspect of income is concerned, same can be very well examined by the AO at the time of framing assessment. However, in the case on hand, the assessee-Trust was refused recognition only on the ground that the assessee- Trust had not spent 85 per cent of the amount towards the objects of the Trust. The Tribunal, while passing the impugned order, relied on a decision in “CIT VS. SURYA EDUCATIONAL & CHARITABLE TRUST” [2011 (10) TMI 47 - PUNJAB AND HARYANA HIGH COURT ] wherein held that at the stage of registration under Section 12AA of the Act, the extent and nature of activities are not required to be examined and the same is required to be examined in assessment proceedings.
We are of the opinion that the Tribunal committed no error in issuing direction to grant recognition to the Respondent-Trust under Section 80G(5) of the Act. - Decided in favour of assessee
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2014 (11) TMI 1164 - ITAT COCHIN
Classification of income on sale of agricultural land - whether the assessee engaged himself in any activity which is an adventure in the nature of trading? - Held that:- It is well settled principles of law that for the purpose of finding out the nature of the activity undertaken by the assessee the intention of the assessee at the time of purchase of the property needs to be ascertained. If the assessee purchases the agricultural property as an investment, then naturally profit arising from sale of such land cannot be treated as profit from business. But if the intention is to earn profit by engaging himself in business activity, then naturally it has to be classified as income from business. To find out the actual nature of the activity, the intention of the assessee at the time of purchase of the property has to be ascertained.
The material available on record shows that the assessee purchased the property on 16-08-2006. The assessee himself claims that an amount of ₹ 1,75,000 was incurred for leveling the land before selling. The assessee entered into an agreement for sale with one Falgunan on 22-082007. Ultimately, the sale deed was executed on 20-08-2008 in favour of St. Antony’s timber Depot, Chevoor. During the course of examination the assessee clarified that the land was left idle and there was no income from this land. He also clarified that no cultivation was done. Therefore, it is obvious that immediately after purchase the assessee has incurred about ₹ 1,75,000 for levelling to make the land a good marketable commodity.
If the intention was to retain the land as agricultural land, then there cannot be any necessity for the assessee to level the land by investing ₹ 1,75,000. The very act of levelling the land by spending about ₹ 1,75,000 immediately after purchase establishes that the intention of the assessee at the time of purchase was to indulge in an activity in the nature of trade. Furthermore, Foreign Exchange Management (Acquisition & Transfer of Immovable Property in India) Regulation, 2000, framed by the Reserve Bank of Indi in exercise of its statutory powers conferred u/s 47 of Foreign Exchange Management (Acquisition & Transfer of Immovable Property in India) Act, 1999 prohibits acquisition of agricultural land by an NRI. The intention of the assessee was to trade in agricultural land, therefore, the profit on sale of agricultural land has to be necessarily classified as income from business. - Decided against assessee.
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2014 (11) TMI 1163 - ITAT, PUNE
Rejection of the books of account u/s. 145(1) - Held that:- Many times expenditure is booked but the assessee may not be in a position to satisfy the Assessing Officer in respect of the nature of the said expenditure as required evidence may not be sufficient. The assessee has not made the provisions in respect of the accounting charges. We find that the Assessing Officer has given more importance to the fact that the assessee is not having any computer. In our opinion a fact also cannot be discarded that many times the assessee may engage professional accountant instead of taking the full liability of the employee and the accountant maintains the account. It is one of the recognized practices in the business or trade. Even if the assessee engaged in the land development and selling of plots but it appears that the said land was owned by the assessee and it was agricultural land which was under cultivation. Except showing minor discrepancy the Assessing Officer has not made out the case for rejection of the books of account by invoking Sec. 145 of the Act. We, accordingly, concur with the finding of the Ld. CIT(A) that the Assessing Officer was not justified in rejecting the books of account of the assessee.
Unexplained expenditure for purchasing hotel - Held that:- CIT(A) has held that the amount of investment in hotel has been recorded by the assessee in the books of account and the source of said investment has also been supported by the sale proceeds of the agricultural land amounting to ₹ 1.16 crores and sale proceeds of the plot amounting to ₹ 2,09,11,282/- during the year. This fact has not been controverted before us. We find no reason to interfere with the order of the Ld. CIT(A) on this issue as the said amount is dully recorded in the books of account and the assessee has also explained the source.
Addition towards alleged cash deposits into bank account - Held that:- It appears that there were deposits ₹ 14,18,736/- in Janlaxmi Bank and ₹ 14,01,090/- in Rajlaxmi Bank which have been recorded by the assessee in the books of account. If the amounts are recorded in the books of account then how the Assessing Officer has made the observation that the bank of account was not appearing in the audited balance sheet. In this case the assessee is in the business of development of agriculture land and sale of plots and he is gradually selling his agricultural land which has been developed and plots are made. The finding of the Ld. CIT(A) has not been controverted before us. The Ld. AR also pointed out that in the balance sheet the said bank accounts are appearing. In our opinion the reasons given by the Assessing Officer are totally erroneous and contrary to the evidence on record. We find no reason to interfere with the order of the Ld. CIT(A).
Addition made on the basis of Department Valuation Officer (DVO) report - Held that:- We find that the difference in the valuation is less than 10% that is between the sale consideration shown by the assessee which is at ₹ 1.61 cores and valuation made the DVO is ₹ 1.76 crores. The Ld. CIT(A) has followed the decision of the ITAT, Pune in the case of Rahul Construction vs. DCIT 38 DTR 19 wherein it is held that if the difference in the valuation made by the DVO and value declared by the assessee is less than 10% then no addition is justified u/s. 50C. As this fact is not disputed before us and also the Ld. CIT(A) has followed the decision in the case of Rahul Construction (2012 (1) TMI 229 - ITAT PUNE), we decline to interfere with the finding of the Ld. CIT(A) for deleting the addition.
Calling the valuation report from the DVO - whether the Ld. CIT(A) can give the directions to the Assessing Officer to get the valuation done by the DVO when admittedly the DVO has given his opinion in respect of the valuation adopted by the assessee for computation of the capital gain? - Held that:- CIT(A) has exceeded his jurisdiction and authority by directing the Assessing Officer to refer the matter to the DVO for ascertaining the fair market value (FMV) of land bearing S. No. 264/1 and 265/1 at Mhasrul as on 01-04-1981. We, therefore, cancel the directions of the Ld. CIT(A) to the extent that the Assessing Officer should ask the DVO to file copies of the valuation report of the lands at S. No. 264/1 and 265/1 valuing the said lands on 01-04-1981. We also cancel the directions of the Ld. CIT(A) that the Assessing Officer should compute the capital gain on the basis of the value of the lands as on 01-04-1981 arrived at by the DVO in his valuation report. At the same time we find that the assessee had already lodged a claimed by filing the valuation report of the Govt. Approved Valuer. We consider it appropriate to give the direction to the Assessing Officer to consider the valuation report of the Approved Govt. Valuer filed by the assessee in respect of the fair mart value of as on 01-04-1981 and accordingly, decide the taxable capital gain as per the provisions of law. We make it clear that we are not expressing anything on merit in respect of correctness of the valuation report obtained by the assessee from the Govt. Approved Valuer. With this direction we allow the Ground Nos. 6 and 7 for the statistical purpose.
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2014 (11) TMI 1162 - GUJARAT HIGH COURT
Applicability of provisions of SICA - effect of direction issued by the BIFR and Applicability of Clause 2(j) of Supply Code - effect of overriding provision in SICA and in Electricity Act - Held that:- Question that whether SICA is a special Act or not, when raised with reference to Companies Act, it is perhaps easier to answer the same. In the present case, attempt was made to urge that Electricity Act is a special Act. It is not possible to agree with this submission. With relation to Electricity Act also, SICA can be said to be special Act. The later Act relates to companies only - rather sick companies - while former Act would apply not only to all kind of companies, including the sick companies, but to every kind of consumer - be it commercial and non-commercial entities. In fact, definition of 'consumer' under the Act includes even the Government. "Any person", it says, who 'receives electricity' comes within the sweep of the definition of 'consumer', while the simple definition of 'sick company', stated in short is, - a company whose accumulated losses of any given financial year exceeds its entire net worth.
In short, while legislative net of consumer under the Electricity Act includes other than company or corporate sector also, while the wings of the SICA does not extend the area outside the sick company - the corporate world itself is much larger than the sick company. It may be noted that the Electricity Act is the only statute operating in the field and dealing with the subject and takes care of all and every kind of consumer, who receives electricity. It is not possible to agree with the submission that Electricity Act is a special Act with reference to SICA. Having said so, we may add that generally saying, neither the test that which of the two Acts are special Act nor the test that which of the two Acts is later in point of time, can be successfully applied in the present case. Both the tests can be more properly applied when both the Acts relate to or operate in, in the same field or the subject of both the Acts is analogous. Since the applicability of either of two tests is doubtful in the present case, we leave the question at that with the observation that if correct view is that, that the special Act versus General Act, test is applicable then application of such test would show that SICA is a special Act.
SICA gives overriding effect not only to its provisions but also to the scheme framed under the special Act. Section 32 itself gives overriding effect to the scheme. Unlike that, Sections 173 and 174 do not refer or include conditions framed by the Board. It may be recalled that Clause 2(j) is framed by the Board i.e. GEB - it may have an effect of law but, so far giving of overriding effect is concerned, neither the conditions framed by the Board contain such provision nor Sections 173 and 174 take care of it. At the time of hearing, attention was not drawn to any such provision in conditions nor Sections 173 and 174 say so. Thus, Section 32 of SICA is apparently wider. When it comes to comparison, Sections 173 and 174 of Electricity Act cannot catch up or compete with Section 32 of the SICA. Further, still, scheme also contains clause giving overriding effect to the scheme. Overriding provision in the scheme has weighed with the learned Single Judge in the judgment under appeal. Learned Single Judge has not committed any error in relying on the said provision while considering the objection raised by the learned advocate for the appellant against the scheme.
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