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Showing 101 to 120 of 1429 Records
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2014 (12) TMI 1336
Levying penalty u/s 271B - reasonable cause which existed in not getting the accounts audited as provided u/s 44AB - failure to get account audited - Held that:- In the perspective of “reasonable cause” still it can be said that the assessee, under the facts available on record was under a “reasonable belief” that since in the case of a commission agent the assessee has received only commission charges, consequently, other reimbursable expenses are not to be includable as income of the assessee thus from this angle also the assessee was under a bona-fide belief that he is not to get his account audited since the income was below prescribed monetary limit. Thus, there was a reasonable cause in not getting the accounts audited, so from this angle also the penalty is not imposable. In view of these facts, the appeal of the assessee is allowed.
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2014 (12) TMI 1335
Reopening of assessment - proceedings reopened after a period of 4 years - grant of benefit u/s 80(O) - Held that:- Accepting the said stand, the assessment was made and benefit under Section 80(O) was granted. With the change of the assessing authority, that too, after taking note of the assessment orders passed subsequent to the said order for the subsequent years, the assessment is sought to be reopened after a period of years. Four years is the period of limitation prescribed for the re-opening of the assessment in the sense, an assessment cannot be reopened unless the case falls within one of the exceptions mentioned in the first proviso.
If an assessment is to be reopened, the assessing authority has reasons to believe that any income chargeable to tax has escaped assessment, it is settled law that change of opinion cannot constitute a ground such as reason to believe for reopening the assessment and that is precisely what the appellate authorities have held.
If an assessment is to be reopened after four years, then the conditions stipulated in the proviso is to be fulfilled. In the instant case, the support is sought from the last ground i.e., failure to disclose fully and truly all material facts necessary for his assessment. However, there is no whisper in this regard. It is in those circumstances, both the authorities on proper appreciation of the entire material on record have concurrently held that case would not fall under Section 147 - Decided in favour of the assessee.
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2014 (12) TMI 1334
Rejection of application of registration of trust - as there is no winding up clause hence “the application cannot be said to have constituted a valid public charitable trust” - Held that:-Admittedly, as per the provisions of section 12AA(1)(b) of the Act, the authority concern is expected to satisfy himself about the objects of the trust of institution and the genuineness of its activities, but at the same time, such satisfaction is objective in nature.
DIT(E) while rejecting the application of the assessee has nowhere mentioned that he was not satisfied with the objects of the trust or genuineness of its activities. DIT(E) has merely perused the audited accounts of the assessee and receipt of donation of ₹ 6 lakh out of which ₹ 3,50,000/- were incurred for educational activities including expenses on printing and stationary, salary, uniform expenses and welfare activities. So far as, scope of powers of the ld. Commissioner/DIT(E) for the purposes of section 12AA of the Act are concerned, the Authority have to satisfy about the genuineness of its activities of the trust or institution. The objects of the trust are available at pages 11 onwards of the paper book (internal pages 5 onwards of the trust deed).
So long, the trust has the objects of charitable nature, in our view, the registration should not be denied. So far as, application of funds and as to whether the assessee can claim benefit of exemption in terms of section 11 and 12 are concerned, these has to be examined by the Assessing Officer at the stage when situation so arises. The assessee vide letter dated 21/11/212 clarified that for winding up of charitable trust section 55 of the Bombay Public Trust Act, 1950 will come into play. The totality of facts clearly indicates that it is a fit case where registration should have been granted by the ld DIT(E). However, we are making it clear that, if at any stage, the assessee trust is found violating the objects of charity or misusing the funds for non charitable purposes/commercial purposes, the Department shall be at liberty to take appropriate action in accordance with law - decided in favour of assessee.
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2014 (12) TMI 1333
Frame the following substantial question of law:-
“Whether the Income Tax Appellate Tribunal was right in holding that the assessee is not entitled to additional depreciation of @15% or 20% under Section 32(1)(iia) of the Income Tax Act, 1961 as it existed prior to 31st March, 2006 or after 1st April, 2006 because the machinery was acquired before 31st March, 2006 but was installed after 1st April, 2006?”
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2014 (12) TMI 1332
Legality of the ceiling proceedings initiated under the Kerala Land Reforms Act, 1963 - resume possession of about 400 acres of land - lands acquired would be treated as a 'Development Area' - whether the lands in question have been assigned in favour of HMT under the Rules or the Assignment Rules?
Held that:- Acquiring land for the establishment of a Machine Tool factory is nothing but an acquisition for the purpose of industrial development of an area in the context of Rule 2(d) of the Rules. Also Rule 23 of the Rules empowers the Government to assign land in the Development Areas dispensing with any of the provisions contained in the Rules like Rules 11 or 8. The mere fact that no restriction was made or that no land value was realised does not take the assignment out of the purview of the Rules. So is the case even if the assignment is made dehors an application routed through the Director of Industries and Commerce in the Form in Appendix I to the Rules as envisaged in Rule 5 thereof.
It is bewildering as to how the State Government could grant exemption to HMT from the provisions of Chapter III of the Act by virtue of notifications dated 29.7.1991 and 4.7.2000. The notifications were purportedly issued in public interest under Section 81(3) of the Act on account of the land being used for industrial purpose. Exemption for the entire extent was granted by notification dated 29.7.1991 and exemption for the extent of 100 acres was granted by notification dated 4.7.2000.
No proceedings could be initiated for the determination of ceiling area when the subject matter of the ceiling case is a Government land whether it be 1.4.1964 or on 1.1.1970. The assignment of Government land in favour of HMT was much after the cut off date and that too under the Rules which itself provide for various contingencies. Whether there are grounds to invoke the power of resumption under Rules 14 and 15 and the modalities thereof under Rules 16 and 17 do not arise for adjudication now.
The proceedings being continued on the file of the Taluk Land Board, Kanayannur in M2724/89 against HMT as a holder of excess lands do not have the sanction of law and are to be aborted - The impugned order of the Taluk Land Board directing HMT to surrender 251.40.000 acres as lands held in excess of the ceiling area is hereby set aside - petition allowed.
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2014 (12) TMI 1331
Entitlement for deduction u/s 80IA - “basic telephone services” provider - whether assessee who are franchisees of BSNL and who have been permitted to install, maintain and operate in-dialling PABX under franchisee to support the department, can be treated to have provided “basic telephone services” entitling them for deduction u/s 80IA? - Held that:- As decided in assessee's own case for the assessment year 1998-99 the assessee have made huge investment in setting up and maintaining the entire PABX. In view of the agreement between the parties which has been minutely considered by this Court, the services provided by the assessee shall fall within the definition of ‘basic telephone service’ and therefore they shall be entitled to deduction u/s 80IA. The Tribunal has not committed any error in reversing the orders passed by the AO. The Tribunal had examined all the aspects of the case and concluded that the assessee were providing basic telecommunication service and were entitled to deduction under section 80IA(4)(ii).
Tribunal is right in law and on facts in holding that the assessee who are franchisees of BSNL and who have been permitted to install, maintain and operate in-dialling PABX under franchisee to support the department, can be treated to have provided “basic telephone services” entitling them for deduction u/s 80IA - Decided in favour of assessee.
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2014 (12) TMI 1330
Partition of property - joint property or not - failure to file affidavits by plaintiffs.
Held that:- The evidence of the plaintiffs is liable to be closed mainly on the two reasons; firstly he has referred to section 35 of the cpc that the cost has not been paid by the plaintiffs and in failure to do so, the plaintiffs are not entitled to proceed further with the matter and secondly he states that more than four adjournments have been granted and the plaintiffs right to adduce the evidence is liable to be closed.
The evidence of the plaintiffs is liable to be closed. Even otherwise, this Court is doubtful if the plaintiffs have any case on merit against the defendant in view of the pleadings of the parties and documents produced.
This is a fit case for closing the evidence of the plaintiffs - suits of plaintiffs dismissed.
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2014 (12) TMI 1329
Legality of the impugned N/N. 17/2008 dated 27.3.2008 and N/N. 31/2008 dated 10.6.2008 - benefit of complete exemption of Central Excise Duty for a period of 10 years from the date of commercial production as granted vide Central Excise N/N. 32/1999 and N/N. 20/2007 by restricting the excise duty refund to a particular percentage of the total duty payable.
Held that:- All the industries set up pursuant to the policy of 1997 and 2007 shall continue to enjoy the benefits of full exemption as per the policy and the notifications - Petition allowed.
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2014 (12) TMI 1328
TDS u/s 194J - amount received from the insurance companies and deposited in Float A/c by the assessee being Third Party Administrator (TPA) - addition u/s 40(a)(ia) - Held that:- This issue is covered in favour of the assessee by the decisions of this Tribunal in the case of ACIT Vs. Health India TPA Services P. Ltd. [2014 (2) TMI 1153 - ITAT MUMBAI] as well as the decision in the case of Paramount Health Services (TPA) Pvt. Ltd. Vs. ITO [2015 (3) TMI 185 - ITAT MUMBAI]. We find that an identical issue has been considered by this Tribunal in those cases by holding that the payment made by the assessee is only to replenish the amount in floating account and, therefore, the disallowance u/s 40(a)(ia) cannot be made when the assessee has not claimed any such expenditure in P&L Account. - Decided in favour of assessee.
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2014 (12) TMI 1327
Principles of forum conveniens - grant of leave or revocation to sue under Clause-12 of the Letters Patent - Whether the situs of the Trade Mark Registry in Chennai and the name being on its register would itself give rise to cause of action to institute a suit in the Madras High Court? - Whether the principles of forum conveniens or analogous principles apply to consideration of an application for leave to sue under Clause 12 of the Letters Patent in case part of cause of action arises at Chennai?
Held that:- Mere registration of the trademark at Chennai would not create the complete cause of action at Chennai. The registration of the mark is a fact, but cause of action would consist of a bundle of facts. Thus, more than one fact would have to be taken into account to determine the location of a particular trademark which connects the trademark to the place - The weight given to each factor should be related to the purpose for which the situs was being determined and thus, mere registration of a trademark at a particular place would not be finally determinative of the situs of the trademark. The situs would depend upon the facts of each case and the factor that connect the trademark to that place.
Thus, the fact that the situs of the registration of trademark is with the Trademark Registry at Chennai by itself would not be sufficient to give rise to cause of action to institute the suit in the Madras High Court, though it may be a factor to be taken into account, among the bundle of facts, for purposes of determining the situs of the cause of action.
There is little doubt that the principles of forum conveniens, though not applicable to civil proceedings, have a role to play insofar as the consideration of grant of leave or revocation thereof under Clause 12 of the Letters Patent is concerned. This is irrespective of the fact as to what expression is used - in considering an application for grant of leave or revocation thereof, the appropriateness or suitability of the forum would be material and to that extent, principle akin to forum conveniens would apply.
Appeal disposed off.
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2014 (12) TMI 1326
TDS u/s 194C - non-deduction of TDS by the assessee on so-called reimbursement of advertisement expenses to its dealers - addition u/s 40(a)(ia) - Held that:- From the facts of the assessee’s case, it appears that it was a structure arrangement wherein the payments are routed through the distributors to circumvent the provisions of Chapter XVII-B of the Act. The bill raised for advertisement in the Danik Bhaskar by DB Corp Ltd., Zone-I, M.P. Nagar, Bhopal was in the name of Spice Communication Ltd. And the client name is also mentioned as Spice Communication Ltd. The SPG Distributors have mentioned in its letter to Mr. Sahil Kohli, Spice Mobile Ltd., placed at page 15 of the paper book, that they have already issued a cheque no.136282 of ₹ 2,24,795/- and asked for reimbursement. Thus, the bill raised by the advertisement agency was not in the name of distributor. This fact itself shows that there was a structure arrangement to avoid the TDS provisions.
The assessee himself has submitted letters from various regional distributors that they have complied with the provisions of TDS under the Act. Such confirmations are placed at pages 42 to 45 of the paper book. Certain bills raised by the advertisement agencies are in the name of distributors. Whether these persons have made TDS or not is not clear from the records. CIT (A) was justified in directing the assessee to produce the evidences before Assessing Officer to establish that the parties to whom the reimbursements have been made had actually complied with the provisions of Chapter XVII-B. Such verification is necessary to arrive at the correct facts of the case and to establish the extent of default on the part of the assessee for violating the provisions of TDS in respect of the payments of the advertisement expenses through the structural arrangement.
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2014 (12) TMI 1325
Taxability of foreign allowance received from Indian Employer - assessee was a non-resident during the year - assessee had paid taxes on the salary and allowances received in Netherlands - tax liability borne by the employer was being redeemed by the assessee in India - CIT(A) deleted the addition by observing that the appellant was non-resident and foreign allowances were not received in India during the year under consideration but received in Netherland. Such allowances wee paid by IBM India using a foreign currency travel card which could be used only outside India.
Held that:- The appellant was non-resident during the year under consideration and allowances were received by him in Netherlands. - The employer wrongly deducted TDS, the appellant had claimed refund on it. The Indian income has been considered by the appellant as taxable but the allowances paid outside the India are not taxable U/s 5(2) of the Act in the case of non-resident - Decided against the revenue.
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2014 (12) TMI 1324
Method of accounting followed by the assessee - justification in changing the method by AO - Project Completion Method OR Completed Contract method - Held that:- Apex Court in the case of CIT v. Hyundai Heavy Industries Co. Ltd., [2007 (5) TMI 196 - SUPREME COURT] also took the similar view and held that both the methods of accounting ( i.e., Project Completion Method and Completed Contract method) were recognized methods of accounting.
The assessee was at liberty to choose any of the above methods and if any one of the method of accounting was consistently followed by the assessee, the AO couldn’t change such method of accounting. The completed contract method followed by the assessee, in the instant case, therefore, could not be faulted with by the revenue authorities and on that basis it was not correct to say that the accounts of assessee did not present correct and complete picture of its profits. Therefore, there was no justification in changing the method from project completion to percentage completion method by the AO, which was upheld by the CIT(A). Therefore, the order of the Commissioner (Appeals) is set aside - we allow the appeal of the Assessee and hold that the method of accounting followed by the Assessee has to be accepted.
Liability to pay interest u/s.234A and 234B - Held that:- The charging of interest is consequential and mandatory and the Assessing Officer has no discretion in the matter and in this view of the matter, we uphold his action in charging the said interest. This proposition has been upheld by the Hon'ble Apex Court in the case of Anjum H Ghaswala & Others (2001 (10) TMI 4 - SUPREME COURT).
Proportionate deduction u/s. 80IB(10) - profits derived from sale of residential units whose built-up area is less than 1500 sq.ft., even though some of the residential units in the very same project exceeds the built-up area of 1500 sq.ft. - Held that:- The same has been decided by the Hon’ble High Court of Karnataka in the case of CIT v. SJR Builders [2012 (3) TMI 615 - KARNATAKA HIGH COURT] as taken the view confirming the order of the Tribunal, by holding that where residential units exceed the built-up area of 1500 sq.ft., such units may be excluded for deduction, but the assessee will not lose the benefit of deduction u/s. 80IB(10) in its entirety. It is only with reference to the flats which is more than the prescribed area that the assessee will lose the benefit of deduction. - Decided in favour of assessee
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2014 (12) TMI 1323
TDS u/s. 194-I - rent paid to Kolkata Port Trust (KPT) - Held that:- We are of the view that in the instant case no tax was deductible at source under section 194-I read with section 204 comprised in Chapter XVII-B from the rent paid by the assessee to KPT. This is because such rent was not to be included in the taxable total income of the KPT and was, therefore, not chargeable under the provisions of the Act.
In the instant case, KPT was not required to pay any tax and in turn the assessee cannot be treated to be in default within the meaning of section 201(1). Accordingly, we are of the view that no disallowance ought to have been made under section 40(a)(ia) of the Act.
In the instant case no tax was deductible at source under section 194-I read with section 204 comprised in Chapter XVII-B from the rent paid by the assessee to KPT. This is because such rent was not to be included in the total income of the KPT and was, therefore, not chargeable under the provisions of the Act. In the case law referred by Ld. Sr. DR the fact relating to the claim of exemption of the income of KPT was not before Tribunal or that issue was not raised but in the instant case, KPT was not required to pay any tax and in turn cannot be treated to be in default within the meaning of section 201(1). Accordingly, we are of the view that no disallowance ought to have been made under section 40(a)(ia) of the Act. - Decided in favour of assessee
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2014 (12) TMI 1322
Unjust Enrichment - Held that:- Revenue failed to demonstrate how the duty liability if any has been passed on to the consumer without being borne by the respondent. Therefore, Revenue's appeal fails for no evidence on record - appeal dismissed - decided against Revenue.
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2014 (12) TMI 1321
Income from subletting and other services - assessable as profit and gains from the business OR income from house property - Held that:- The assessee was given right to, “assigned, sub-let, under-let or part with any possession of the room or any part of room or permit any person to occupy even in case of temporary absence of assessee”. By virtue of this agreement assessee collected licence fees and other charges from sub-tenants and the Revenue all along has accepted the income declared by the assessee under the head “profits and gains of business or profession”.
The terms of the lease of business assets, the intention of the lessor is that the asset leased out must remain and be treated as commercial asset and there is an exploitation of the commercial asset during the lease period and lease received is assessable as business income. In view of the above facts of the case that the assessee is consistently declaring the receipt of income from sub tenants under the head, “profits and gains of business or profession”, we are of the view that principle of consistency will apply in this case as the issue stand covered by the decision of coordinate bench in the case of M/s. Banwarilal Goel & Sons Vs. ITO [2014 (2) TMI 1337 - ITAT KOLKATA]
In view of the above discussions, we uphold the grievance of the assessee and direct the Assessing Officer to treat the income in question as income from business as has been in preceding and subsequent assessment year. - Decided in favour of assessee
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2014 (12) TMI 1320
Deduction u/s 80IB - Date of commencement of project u/s 80IB - earlier commencement certificate cancelled - Held that:- Earlier commencement certificates could not be held to be valid after one year from the date of issuance - thereafter, there was a commencement certificate issued on 2nd March, 2001 - if the earlier certificate was lapsed or were treated as cancelled, then, the Tribunal was right in its conclusion that benefit of section 80IB (10) can be derived or taken by the assessee thus all the three conditions for availing of the deduction or benefit are, thus, complied with - hence the appeal does not raise any substantial question of law and it is, accordingly, dismissed
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2014 (12) TMI 1319
Evidences - there is no other evidence to support the revenue allegation despite of the fact that evidence produced by the department regarding signatures of the persons who prepared and signed parallel invoices were found to be similar to that appearing on the genuine invoices - Held that: - the findings recorded by the Appellate Authority and the Tribunal, are essentially finding of fact recorded on appreciation of documents brought on record and the statements recorded in the proceedings, which do not raise question of law much less any substantial question of law, to be decided in this appeal - appeal dismissed.
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2014 (12) TMI 1318
SSI Exemption - valuation - Value of cartons supplied by the appellants to the exporter was not being included in the total value of the clearances, for the purpose of SSI exemption benefit - Held that: - An identical question was considered in the case of Universal Packaging v. CCE, Mumbai-V [2010 (9) TMI 561 - CESTAT, MUMBAI] and it was held that carton/packaging material cleared to exporter, who used the same for packaging of exported material, which was admittedly exported in terms of Rule 19(1) of Central Excise Rules, 2002, has to be held as clearances for export and value of the same is not required to be added in the value of home clearances - appeal allowed - decided in favor of appellant.
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2014 (12) TMI 1317
Revision u/s 263 - non deduction of tds on payments of rent, consultancy charges, professional charges and sales promotion charges - Held that:- TDS is deductible only if the conditions specified for deduction of TDS are existing. Hence, CIT's observation in the order that the AO's order is erroneous and prejudicial to the interest of the revenue has no basis whatsoever.
The observation of the CIT that the AO's order being erroneous and prejudicial to the interest of the revenue is emanating from the show cause notice. Operative part of the order passed u/s. 263 of the Act the ld.CIT has held that he was of the view that the issue needs re-consideration, therefore, he was setting aside the issue and referring back to the table of the AO for re-consideration. Section 263 does not give any power whatsoever to the ld.CIT to remit the issue to the file of the AO without his finding that the order of the AO is erroneous insofar as it is prejudicial to the interest of the revenue - CIT's order passed u/s. 263 is not sustainable as the he has not given a finding that the order of the AO passed u/s. 143(3) of the Act is erroneous in so far as it is prejudicial to the interest of the revenue and had simply set aside the matter and referred back to the table of the AO for re-consideration. In our view this is not at all permissible u/s. 263 - Decided in favour of assessee
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