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Showing 101 to 120 of 2052 Records

• 2019 (3) TMI 1958 - ITAT MUMBAI
  

  Estimation of income - Bogus purchases - CIT(A) for restricting the disallowance to 3% of the total value of the purchases - HELD THAT:- This Tribunal passed in assessee’s own case for the A.Y.2009-10, 2010-11, 2012-13 & 2013-14 [2019 (1) TMI 1961 - MADRAS HIGH COURT] wherein, the aspect of purchases made from suppliers belonging to Rajendra Jain Group have been the subject matter of adjudication as held assessee has explained that all its sales are by way of exports. The books of account maintained by the assessee show payment for effecting such purchases by account payee cheques and also the vouchers for sale and purchase of goods, etc. Notably, no independent enquiries have been conducted by the AO. AO was not justified in making additions merely on the basis of information obtained from the Sales Tax Department of the Government of Maharashtra without conducting any independent enquiries. Before the CIT(Appeals), one of the points raised by the assessee was with respect to an opportunity to cross examine the four parties, but we find that no such opportunity have been allowed.

  Assessing Officer in the instant case has stated that Mr. Rajendra Jain, Mr. Dharmichand Jain and Mr. Anoop Jain have appeared before him. However, it is not made clear as to whether the above said three persons were partners/directors, all the suppliers belonging to Rajendra Jain. The purchases made from companies, where these three persons are either partner/director, shall be aware by the above said decision rendered by Coordinate Bench. The purchases made from other companies, however requires fresh examination.

  The aforesaid decisions rendered would apply mutatis mutandis to the case before us. Accordingly, we restore the issue relating to addition on account of bogus purchases made during the year under consideration to the file of the Ld. AO with a direction to delete the addition relating to purchases made from companies, in which above said three persons are partners / Directors. Appeals of the assessee as well as the revenue are allowed for statistical purposes

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• 2019 (3) TMI 1957 - MADRAS HIGH COURT
  

  Maintainability of petition - validity of sale certificate - petition is alleged to be not maintainable as the petitioner has not challenged the Sale Certificate before the Debts Recovery Tribunal under Section 17 of the SARFAESI Act - HELD THAT:- The Hon'ble Supreme Court of India in AUTHORIZED OFFICER, STATE BANK OF TRAVANCORE AND ANOTHER VERSUS MATHEW K.C. [2018 (2) TMI 25 - SUPREME COURT] and AGARWAL TRACOM PVT. LTD. VERSUS PUNJAB NATIONAL BANK & ORS. [2017 (11) TMI 1523 - SUPREME COURT] held that the aggrieved parties cannot challenge the SARFAESI proceedings directly by filing a Writ Petition under Article 226 of the Constitution of India without exhausting the appeal remedy available to them.

  Since the petitioner has filed the Writ Petition without exhausting the alternate remedy by way of an appeal available to him under Section 17 of the SARFAESI Act, following the ratio laid down by the Apex Court, the Writ Petition cannot be entertained - petition dismissed.

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• 2019 (3) TMI 1956 - ITAT AMRITSAR
  

  Penalty imposed u/s 271(1)(c) - diversified views - HELD THAT:- Members constituting the co-ordinate Bench passed the divergent orders qua imposition and affirmation of penalty u/s 271(1)(c), therefore reference u/s 255(4) of the Act was made to the Hon’ble President of ITAT for adjudication of the issues under consideration by Ld. Third Member [2019 (6) TMI 1283 - ITAT AMRITSAR] who decided the issues in favour of the assessee and directed the registry to list these appeals before the Division Bench for passing an order in confirmity with the majority view (kindly refer para no. 9 to 12 of the order) . As per section 255(4) of the Act, the majority view is final and consequential order is required to be passed and hence as per majority view, the penalty imposed by the Assessing Officer and sustained by the ld. CIT(A) is liable to be deleted. Consequently, the penalty stands deleted.

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• 2019 (3) TMI 1955 - APPELLATE AUTHORITY FOR ADVANCE RULINGS, UTTARAKHAND
  

  Classification and rate of GST - receipts received by the applicant on the count of distribution of electricity - Checking and testing of meters - Subsequent testing and installation other than initial testing - Disconnection and Reconnection of supply on consumers request or non-payment of bill - Replacement of Meters, Changing of position of meter board at the consumer's request - Checking of Capacitors (other than initial checking) on consumer's request - Charge for providing copy of MRI summary report - Maintenance charge for public lamps - Advance deposit by consumer with application for temporary LT / HT connection - Charge for special meter reading on the request of the Consumer - Service line charges and overhead line charges for release of new LT connection and for enhancement /reduction in sanctioned load - Recovery of cost of burnt meter from the Consumer - Registration cum processing fee - Works charges for release of new HT/EHT connection and for enhancement / reduction in sanctioned load - Security deposits at the time of release of new HT/ EHT connection and for enhancement in sanctioned load - Charges for shifting of service lines and meters etc. - Recovery of damage to material and dismantling charges on expiry of temporary connection - Replacement of Meters, Installation of meter and its subsequent removal in case of Temporary Connections - Supervision charges.

  HELD THAT:- The issue is squarely covered by Board's Circular 34/8/2018-GST dated 01.03.2018, para 4 of which fully exempts Service by way of transmission or distribution of electricity by an electricity transmission or distribution utility. However, it has also specifically excluded from this exemption, certain other ancillary services which are not directly or closely related to the said service. Thus to determine the taxability of the issues enumerated in the Table-I above, we will be guided by the referred Board's circular. In short, all services which are directly or closely related to generation and distribution of electricity will be completely exempted and any other ancillary service (akin to the ones included in the exclusion clause of the said para 4 of the Board's referred circular, will be taxed at the appropriate prevailing rate.

  The said clause of the circular has been struck down by Hon'ble Gujarat High Court, in an identical issue in the matter of TORRENT POWER LTD. VERSUS UNION OF INDIA [2019 (1) TMI 1092 - GUJARAT HIGH COURT]. However, it has been ascertained that the order has not been accepted by the concerned Commissionerate and a proposal for filing an appeal has already been forwarded to the Board. Accordingly, the said decision of the Hon'ble High Court cannot be cited as a precedent in the present case since the issue has not reached finality.

  Further, Charges for distribution and supply of electricity such as fixed charge, demand charge, energy charge, fuel charge adjustment, excess load demand charge, low power factor surcharge, low voltage surcharge/ high voltage rebate, wheeling charge, cross subsidy surcharge and additional surcharge etc., Delayed Payment Surcharge, Assessment against theft and unauthorized use of electricity, Security deposits at the time of release of new LT connection and for enhancement in sanctioned load, Security deposits at the time of release of new HT/ EHT connection and for enhancement in sanctioned load, Checking and testing of meters, Advance deposit by consumer with application for temporary LT / HT connection, Service line charges and overhead line charges for release of new LT connection and for enhancement /reduction in sanctioned load, Works charges for release of new HT/EHT connection and for enhancement / reduction in sanctioned load and Replacement of Meters, Installation of meter and its subsequent removal in case of Temporary Connections are exempt from tax.

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• 2019 (3) TMI 1954 - APPELLATE AUTHORITY FOR ADVANCE RULINGS, UTTARAKHAND
  

  Classification of goods - rejected wheat seeds - rejected paddy seeds - to be classified under Chapter 12 of the GST Tariff - HELD THAT:- A seed is liable to be rejected for not fulfilling any or all of the above characteristics. But this rejection only means that it has failed to pass the set parameters for a good quality seed. Such rejections cannot change its inherent character of being a grain of 'seed quality'. A pair of shoes manufactured by a branded company often gets rejected on quality issues, but it still will remain a pair of shoes, albeit with an added adjective 'rejected'. So, Sri Chandra's reasoning that once the seed is rejected it no longer remains a seed, is also not acceptable. For these reasons, 'rejected wheat or paddy seeds' cannot be covered by Entry Serial 63 covering Chapter 12 of the GST Tariff. The seeds of both wheat and paddy, rejected or otherwise, are also appropriately classifiable under Chapter 10 of the tariff ibid.

  In fact there are specific entries in the tariff. Chapter sub heading 1001 11 00 covers seeds of Durum wheat while 1001 91 00 covers seeds of other varieties of wheat. Similarly, Chapter sub heading 1006 10 10 covers paddy (rice) of seed quality. However, we find that 'NIL' rate of GST is applicable on these goods. If the rejected seeds are put up in a unit container and bearing a registered brand name or bearing a brand name on which an actionable claim or enforceable right in respect of such brand name has been foregone voluntarily, then the effective CGST & SGST rate on both will be 2.5% & 2.5%.

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• 2019 (3) TMI 1953 - APPELLATE AUTHORITY FOR ADVANCE RULINGS, UTTARAKHAND
  

  Exemption from GST - contractors/sub-contractors involved in the construction of Indo-Nepal Border Road - Applicability of N/N. 12/2017-Central Tax (Rate) dated 28.06.2017 (as amended from time to time) - Whether the exemption available to PWD Uttarakhand and M/s NHPC Ld. can be extended to the sub contractor also? - HELD THAT:- Present case pertains to the GST period therefore we have to confine to the notification issued under CGST/SGST Act. With regard to the services rendered to the Government, initially notification no 11/2017 Central fax (Rate) dated 28-06-2017 was issued by which contractor & sub contractor were made liable to pay GST 18%. Further Notification no 24/2017 CT (Rate) dated 21 September 2017 was issued making govt. contractors liable to pay GST 12% - There is no specific entry in the notification no. 12/2019- CT (Rate) dated 28-06-2017 making sub contractor's supply of services to the main contractor as exempt. However, in the process, the sub contractors are to be taxed at the same rate as the main contractor not due to the reason of extrapolation. It is for the ease of calculation of ITC & tax liability, both the entities are made liable to be taxed at the same rate. The serial no. 9C of notification no. 12/2017 (amended vide notification no 32/2017), exempts the services by a govt. entity to another govt. entity. Neither this notification nor any other notification exempts the work contract services from govt. entity to private contractor or contractor to sub-contractor. The observation ni ade by the GST Council in reducing the tax liability of such contractor was made for the ease of calculations. This fortifies the fact that only the notification and the conditions specified therein, determines the taxability on supply of goods/ services.

  The pre GST circular no 147/16/2011-ST dated 21-10-2011 and Para 29(h) of the Mega exemption notification no. 25/2012-ST dated 20-06-2012 to exempt sub contractor cannot be referred, as Service Tax is now repealed and cannot be applied on the supply of services pertaining to GST regime. Thus the taxability on the sub contractor in such cases have to be decided in view of the notification issued under CGST/SGST Act.

  The works contract services for the road construction provided by the sub contractor to PWD, Uttarakhand, who in turn is providing works contract services of road construction to M/s NHPC Ltd is not exempted from GST.

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• 2019 (3) TMI 1952 - ITAT KOLKATA
  

  Cessation of liability towards creditors u/s 41(1) - HELD THAT:- Evidence in the form of confirmations of the concerned two creditors were filed by the assessee before the AO to establish the existence of the said creditors, but the Assessing Officer still treated the said creditors as bogus or non-existent and made addition u/s 41(1) on the ground that assessee’s liability towards the said creditors had ceased to exist. As rightly contended by the learned counsel for the assessee, onus was on the AO to establish that the liability towards the said creditors had ceased to exist in the year under consideration and since the said onus was not discharged by the AO, we are of the view that the Ld. CIT(A) was fully justified in deleting the addition made by the AO u/s 41(1) - Decided against revenue.

  Disallowance u/s 14A - CIT-A deleted the addition HELD THAT:- As decided in the case of CIT vs Hero Cycles (P) Ltd. [2009 (11) TMI 33 - PUNJAB AND HARYANA HIGH COURT] as well as REI Agro Ltd. [2013 (9) TMI 156 - ITAT KOLKATA] wherein it was held that no disallowance u/s 14A could be made if there was no exempt income actually earned by the assessee during the relevant year. In the present case, no exempt income was earned by the company during the year under consideration and this being the undisputed position, we find no infirmity in the impugned order of the Ld. CIT(A) deleting the disallowance made by the A.O. u/s 14A - Ground No. 2 of Revenue’s appeal is accordingly dismissed.

  Claim of the assessee for set off of loss recorded under the head “profits and gains of business or profession” against the addition made by the A.O. u/s 68 - HELD THAT:- the issue involved in the present case is relating to the claim of the assessee for set off of business loss of the current year against the income assessee u/s 68 in the same year. It is observed that this issue as involved in the assessee’s case is squarely covered in favour of the assessee by the various judicial pronouncements cited by the learned counsel for the assessee. In one of such decisions rendered in the case of ITO vs M/s. Prism Share Trading Pvt. Ltd [2018 (12) TMI 212 - ITAT MUMBAI] allowing the claim of the assessee for set off of loss under the head “Profits and Gains of business or profession” against the income assessed u/s 68. Ground No. 3 of the Revenue’s appeal is accordingly dismissed.

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• 2019 (3) TMI 1951 - ITAT MUMBAI
  

  Allowance of business loss - assessing the commencement of the business of the assessee by which the claim of the assessee was allowed - Whether CIT(A) admitted additional evidence without giving opportunity to the Assessing Officer under Rule 46A of Income Tax Rule - HELD THAT:- CIT(A) has considered the incorporation certificate which was obtained w.e.f. 16.12.2011. The CIT(A) has considered the expenses from pre-incorporation period and post of incorporation period. CIT(A) has considered the invoices for the payment to interior designer and invoices to purchase the computer in the month of January which shows about the activities business. The payment was also made to Microsoft as License fee. The assessee incurred expenses upon the employees in the shape of Salary, Professional Fees, travelling for Work, Office Expenses, Telephone Expenses etc. w.e.f. January, 2012 onwards. The assessee has also entered into an Investment Management Agreement with IL &FS on 1st February, 2012 and also applied for Credit Alpha Alternative Fund’s as Venture Capital Fund with SEBI on 07.02.2012. All these facts speak about the initiation of the business.

  On appraisal of the order, we nowhere found that the additional evidence if any was admitted by CIT(A) without giving an opportunity of being heard to the AO in view of the provisions u/s 46A of the Act. The documents which has been considered by the CIT(A) were already on record which were not considered by the AO. Nothing came into noticed that the new documents were considered by the CIT(A) while allowing the claim of the assessee.

  As relying ON M/S. AXIS PVT. EQUITY LTD. [2017 (2) TMI 340 - BOMBAY HIGH COURT] we noticed that the factual position in connection engaged of legal and financial advisors and incurred expenditure to decide appropriate tax efficient structure for funds and employment to the personnel for the purpose of running its business has been considered for the establishment and commencement of the business and accordingly allowed the business loss. Since, no new evidence was considered by CIT(A), therefore, the plea taken by revenue on account of giving an opportunity u/s 46A of the Act has no force. Taking into account of all the facts and circumstances, we are of the view that the CIT(A) has rightly allowed the claim of the Assessee. Finding no reason to interfere with the finding of the CIT(A), we affirm the finding of the CIT(A) on all the issues and decide these issues in favour of the assessee

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• 2019 (3) TMI 1950 - APPELLATE AUTHORITY FOR ADVANCE RULING, GOA
  

  Levy of GST - one time concession fees charged by the appellant in respect of their property - long term lease of 60 years for development of infrastructure for financial business or private investment made on DBFOT (Design, Build, Finance, operate and Transfer) providing - exemption as per Sr. No.41 of the N/N. 12/2017 -Central Tax (Rate), dated 28/06/2017 as amended by N/N. 32/2017 - Central Tax (Rate), dated 13/10/2017 - HELD THAT:- The appellant is not the authority primarily involved in developing or leasing any industrial plots / other plots for Financial Business - To consider the Appellant's entitlement to exemption, the Lessee should be the entity involved in the activity of developing a land / particular mass of area into multiple industrial plots which in turn would be allotted to different potential industrialists. However, in the instant case, the Lessor is not the entity involved for development of any Industrial or Financial Business area but for promotion of tourism and allied activities simply - Lessor being not involved in the activity of allotting industrial space and Lessee being the entity not involved into developing multiple industrial plots, the benefit of the said Notification is not applicable to the Appellant.

  It is an established and settled position of law that the conditions of the Notifications are required to be strictly interpreted. As the Appellant does not meet all the requirements stipulated in the- Notification, the benefit of the said Notification will not be available to them.

  On a careful reading of the correct position of the statute vis-a-vis the appellant's contention, it clearly emerges that the language employed in the statute as discussed in para 10 (i) to (iv) are plain and unambiguous and it amply conveys the legislative intent. The appellant does not satisfy the criteria laid down in Sr. No. 41 of the Notification No. 12/2017 (CGST (Rate) dated 28/06/2017) as amended by Notification No. 32/2017 (CGST (Rate) dated 13/10/2017.

  The Ruling given by AAR-Goa being consistent with the extant statute is maintained. The appeal is rejected.

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• 2019 (3) TMI 1949 - CESTAT CHENNAI
  

  Refund of SAD - non-fulfilment of condition 2(e)(ii) of N/N. 102/2007-Cus., dated 14-9-2007 - rejection of refund stating that the description shown in the sales invoices does not match with the description shown in the bill of entries - HELD THAT:- It is seen that the description shown in the bill of entry is as per the nature or classification of goods whereas in the sales invoices only grades are shown. The department does not have a case that goods were not imported or sold. The sales invoices, Bill of Entry together with Chartered Accountant Certificate is produced by assessee along with refund claim. All these documents ‘together would definitely show that there are no discrepancies with the goods sold. The Tribunal in the case of PRECISION INFORMATIC (M) PVT. LTD. VERSUS COMMISSIONER OF CUSTOMS, CHENNAI-IV [2017 (12) TMI 1828 - CESTAT CHENNAI] has held that minor discrepancies cannot disentitle the importer from getting benefit of refund.

  Rejection on the ground that Chartered Accountant’s Certificate is not proper for the reason it is issued without verification of the accounts of the appellant - HELD THAT:- The notification mandates the furnishing of the certificate issued by a statutory auditor. The department does not have a case that the certificate was not issued by a statutory auditor. There is no evidence to show that the certificate does not correlate with accounts of appellant.

  The reasons for rejection of refund are unjustified - Appeal allowed - decided in favor of appellant.

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• 2019 (3) TMI 1948 - ITAT DELHI
  

  Reopening of assessment u/s 147 - Reliance on information of investigation wing - addition u/s 68 - entry providers during the proceedings u/s 132 have admitted that the assessee company had taken accommodation entries - notice after expiry of four years from the relevant assessment year - HELD THAT:- AO has acted mechanically on the information of investigation wing about the alleged accommodation entries and has drawn his conclusions without applying his mind or making any enquiry in the matter before forming the belief of escapement.

  In the case of CIT vs. Meenakshi Overseas Pvt. Ltd. [2017 (5) TMI 1428 - DELHI HIGH COURT] in the identical facts, similar reasons were recorded by the AO on the basis of information of Investigation Wing where there was no independent application of mind to any tangible material which formed the basis of belief of escapement. In that case also, the information received contained (i) the names of beneficiaries (ii) bank name & branch of beneficiaries banks and entry giving banks, (iii) value of entries taken (iv) name of account holder of entry giving account and the Assessing Officer after going through the said information straightway derived its conclusion without application of his mind.

  In the instant case also, similar reasons along with similar wordings have been recorded and the AO while concluding the accommodation entries in the garb of share capital, has failed to apply its mind in support of its belief. Here in this case, the reasons recorded do not refer any evidence or any confession /statements of entry operator, cash payment by assessee, payment of commission etc. so as to support its belief that the assessee was beneficiary of the entry operating racket. There is also no whisper in the reassessment order against the contention of the assessee that the Income-tax authorities themselves have assessed the alleged entry operator u/s. 153C of the Act and the Income-tax Return filed by these group companies have been accepted in March, 2013.

  Assessee has submitted copies of assessment orders in the case of Mani Malal Delhi Properties (P) Ltd. for the assessment year 2007-08 u/s. 153C/153A where the ITR filed by this company stands accepted by ITO Central Circle 23 New Delhi resulting into no addition. Similar is the position with respect to other companies M/s. Hill Ridge Investment Ltd. and M/s. Mega Top Promoters (P) Ltd.

  Thus in view the fact that there was reference in the notice of any satisfaction of competent authority as contemplated u/s. 151 even after issuance of notice after four years from the end of assessment year; that there is no reference of any evidence such as statement or confession of the alleged entry operator against the assessee; that there is absence of any particular fact which the assessee failed to disclose fully and truly regarding the share capital at the time of original assessment; that the satisfaction note of the Assessing Officer is solely based on information of investigation Wing; and that in the assessments of alleged entry operator group u/s. 153C, the returns filed by them stood accepted by the department itself and after considering various Authorities cited by the ld. AR and the ld. CIT(A), we find no infirmity in the decision of the ld. CIT(A) while holding the reopening proceedings as void and illegal. - Decided in favour of assessee.

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• 2019 (3) TMI 1947 - NATIONAL COMPANY LAW TRIBUNAL, MUMBAI BENCH
  

  Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - HELD THAT:- The Corporate Debtor is liable to pay the Petitioner and defaulted in making the payment to the Petitioner. During the hearing of this matter by this Bench, the Counsel representing the Corporate Debtor accepted the liability as well as default.

  This Adjudicating Authority, on perusal of the documents filed by the Creditor, is of the view that the Corporate Debtor defaulted in repaying the loans availed and also placed the name of the Insolvency Resolution Professional to act as Interim Resolution Professional and there being no disciplinary proceedings pending against the proposed resolution professional, therefore the Application under sub-section (2) of Section 7 is taken as complete, accordingly this Bench hereby admits this Petition - Petition admitted - moratorium declared.

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• 2019 (3) TMI 1946 - SUPREME COURT
  

  Right of settlement of dispute - whether after furnishing of no claim certificate and the receipt of payment of final bills as submitted by the contractor, still any arbitral dispute subsists between the parties or the contract stands discharged? - HELD THAT:- It is true that there cannot be a Rule of absolute kind and each case has to be looked into on its own facts and circumstances. At the same time, we cannot be oblivious of the ground realities that where a petty/small contractor has made investments from his available resources in executing the works contract and bills have been raised for the escalation cost incurred by him and the railway establishments/Appellants without any justification reduces the claim unilaterally and take a defence of the no claim certificate being furnished which as alleged by the Respondents to be furnished at the time of furnishing the final bills in the prescribed format.

  In the present batch of appeals, independence and impartiality of the arbitrator has never been doubted but where the impartiality of the arbitrator in terms of the arbitration agreement is in doubt or where the Arbitral Tribunal appointed in terms of the arbitration agreement has not functioned, or has failed to conclude the proceedings or to pass an award without assigning any reason and it became necessary to make a fresh appointment, Chief Justice or his designate in the given circumstances after assigning cogent reasons in appropriate cases may resort to an alternative arrangement to give effect to the appointment of independent arbitrator Under Section 11(6) of the Act - In the given circumstances, it was the duty of the High Court to first resort to the mechanism in appointment of an arbitrator as per the terms of contract as agreed by the parties and the default procedure was opened to be resorted to if the arbitrator appointed in terms of the agreement failed to discharge its obligations or to arbitrate the dispute which was not the case set up by either of the parties.

  The High Court was not justified in appointing an independent arbitrator without resorting to the procedure for appointment of an arbitrator which has been prescribed under Clause 64(3) of the contract under the inbuilt mechanism as agreed by the parties - the Appellants are directed to appoint the arbitrator in terms of Clause 64(3) of the agreement within a period of one month from today under intimation to each of the Respondents/contractors and since sufficient time has been consumed, at the first stage itself, in the appointment of an arbitrator and majority of the Respondents being the petty contractors, the statement of claim be furnished by each of the Respondents within four weeks thereafter and the arbitrator may decide the claim after affording opportunity of hearing to the parties expeditiously without being influenced/inhibited by the observations made independently in accordance with law.

  Appeal disposed off.

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• 2019 (3) TMI 1945 - ITAT DELHI
  

  Disallowance of business expenses and depreciation and interest - HELD THAT:- We find every force in the observation of the learned CIT(A) that till such time the company has to maintain its status as company and also has to be discharged certain legal obligations for which it requires the support of the clerical staff and the secretary or the accountant, as the case may be, and also to incur certain incidental expenses in that pursuit. It is, therefore, clear that when the possibility of the revival of the business activities or operation of the assessee are not ruled out once for all, it cannot be said that the assessee company had closed down its operations permanently so as to disallow the business expenditure. The temporary lull in the business during the lean period of transaction cannot be mistaken to be the permanent close down of the business. The clear indication is that the assessee has to maintain its status as company till the end comes and it has to perform certain legal obligations by incurring certain expenditure and more particularly to pursue the litigation as a result of which it has to receive ₹ 460 crores approximately which shall form part of the income of the assessee in the year in which it will be received.

  While recording the fact that no manufacturing activity had taken place by the assessee during the year, learned CIT(A) disallowed the depreciation on plant and machinery but he rightly thought it fit to allow depreciation on furniture and building. We endorse the same view so also CIT(A) rightly deleted the addition of ₹ 3384/- by recording a fact that during the year the assessee had not received any amount by way of income-tax refund.

  We are of the considered opinion that the impugned order does not suffer any illegality or irregularity and on the other hand, the appeal of the revenue is devoid of merit.

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• 2019 (3) TMI 1944 - SUPREME COURT
  

  Seeking the release of a tractor and trolley seized - illegal excavation of sand from the Chambal river - submission is that the confiscation proceedings have been initiated in terms of Section 52(3) and hence the procedure is governed by Sections 52 and 52-A - HELD THAT:- The specific provisions have been made for the seizure and confiscation of forest produce and of tools, boats, vehicles and articles used in the commission of offences. Upon a seizure Under Section 52(1), the officer effecting the seizure has to either produce the property before the Authorised Officer or to make a report of the seizure Under Sub-section (2) of Section 52. Upon being satisfied that a forest offence has been committed, the Authorised Officer is empowered, for reasons to be recorded, to confiscate the forest produce together with the tools, vehicles, boats and articles used in its commission. Before confiscating any property Under Sub-section (3), the Authorised Officer is required to send an intimation of the initiation of the proceedings for the confiscation of the property to the Magistrate having jurisdiction to try the offence.

  The order of confiscation Under Section 52(3) is subject to an appeal Under Section 52-A and a revision Under Section 52-B. Sub-section (5) of Section 52-B imparts finality to the order of the Court of Sessions in revision notwithstanding anything contained to the contrary in the Code of Criminal Procedure and provides that it shall not be called into question before any court. Section 52-C stipulates that on the receipt of an intimation by the Magistrate Under Sub-section (4) of Section 52, no court, tribunal or authority, other than an Authorised Officer, an Appellate Authority or Court of Sessions (Under Sections 52, 52A and 52-B) shall have jurisdiction to pass orders with regard to possession, delivery, disposal or distribution of the property in regard to which confiscation proceedings have been initiated.

  Upon the receipt of an intimation by the Magistrate of the initiation of confiscation proceedings Under Sub-section (4)(a) of Section 52, the bar of jurisdiction Under Sub-section (1) of Section 52-C is clearly attracted. The scheme contained in the amendments enacted to the Indian Forest Act 1927 in relation to the State of Madhya Pradesh, makes it abundantly clear that the direction which was issued by the High Court in the present case, in a petition Under Section 482 of the Code of Criminal Procedure, to the Magistrate to direct the interim release of the vehicle, which had been seized, was contrary to law. The jurisdiction Under Section 451 of the Code of Criminal Procedure was not available to the Magistrate, once the Authorised Officer initiated confiscation proceedings.

  The Madhya Pradesh amendments to the Indian Forest Act 1927 are infused with a salutary public purpose. Protection of forests against depredation is a constitutionally mandated goal exemplified by Article 48A19 of the Directive Principles and the Fundamental Duty of every citizen incorporated in Article 51A(g)20. By isolating the confiscation of forest produce and the instruments utilised for the commission of an offence from criminal trials, the legislature intended to ensure that confiscation is an effective deterrent. The absence of effective deterrence was considered by the Legislature to be a deficiency in the legal regime - As an effective tool for protecting and preserving environment, these provisions must receive a purposive interpretation. For, it is only when the interpretation of law keeps pace with the object of the Legislature that the grave evils which pose a danger to our natural environment can be suppressed. The avarice of humankind through the ages has resulted in an alarming depletion of the natural environment. The consequences of climate change are bearing down on every day of our existence. Statutory interpretation must remain eternally vigilant to the daily assaults on the environment.

  Appeal allowed.

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• 2019 (3) TMI 1943 - KARNATAKA HIGH COURT
  

  Dishonor of Cheque - insufficiency of funds - rebuttal of evidence - territorial Jurisdiction - Whether the complaint ought to have been filed before the Hospet Court instead of Sandur Court as Sandur Court without territorial jurisdiction? - Whether the Courts below have committed an error in appreciating the evidence available on record and the same is perverse? - HELD THAT:- Having read the proviso of amended Negotiable Instruments Act under Section 142(2) and also the explanation as well as Section 142-A regarding validation of transfer of pending cases, it is clear that any judgment, decree, order or direction of any court, all cases should be transferred to the Court having jurisdiction under sub-section (2) of Section 142. Further, in Section 142-A, it is specific that, shall be deemed to have been transferred under this Act, as if that sub-section had been in force at all material times.

  Having analyzed Section 142(2) and also the explanation and also Section 142-A, and also the principles laid down in the judgment referred supra i.e. M/s. Bridgestone India Pvt. Ltd., vs. Inderpal Singh, [2015 (12) TMI 777 - SUPREME COURT] wherein the Apex Court has categorically held that the jurisdiction for initiating the proceedings for the offence under Section 138 of the N.I. Act, inter-alia, in the territorial jurisdiction of the Court, where the cheque is delivered for collection that too through an account of the branch of the bank where the payee or holder in due course maintains an account - Insofar as the instant aspect of the matter is concerned, a reference may be made to Section 4 of the Negotiable Instruments (Amendment) Second Ordinance, 2015, whereby Section 142A was inserted into the Negotiable Instruments Act. A perusal of Sub-Section (1) thereof leaves no room for any doubt, that insofar as the offence under Section 138 of Negotiable Instruments Act is concerned, on the issue of jurisdiction, the provisions of the Code of Criminal Procedure, 1973, would have to give way to the provisions of the instant enactment on account of the non-obstante clause in sub-section (1) of Section 142A. Likewise, any judgment, decree, order or direction issued by a Court would have no effect insofar as the territorial jurisdiction for initiating proceedings under Section 138 of the Negotiable Instruments Act is concerned.

  The Apex Court comes to the conclusion that based on Section 142A, to the effect, that the judgment rendered by the Apex Court in Dashrath Rupsingh Rathod's case [2014 (8) TMI 417 - SUPREME COURT], would not stand in the way of the appellant, insofar as the territorial jurisdiction for initiating proceedings emerging from the dishonor of the cheque in the said case. The Apex Court interpreting the proviso of Section 138, 142A, 142(2) and also Section 142(a) of N.I. Act, comes to the conclusion that the Indore Court would have the territorial jurisdiction to take cognizance of the proceedings initiated by the appellant under Section 138 of the Negotiable Instruments Act, 1881, after the promulgation of the Negotiable Instruments (Amendment) Second Ordinance, 2015.

  In the case on hand, the cheque was issued in 2007 and the same was presented in 2007 itself and the same was dishonored. The endorsement was given by the branch at Hospet of the complainant who presented the cheque in Hospet and case is filed before the Sandur Court. When such being the case, the proviso of Amendment Act of 2015, aptly applicable to the case on hand - the contention of the respondent cannot be accepted and there is force in the contention of the counsel for revision petitioner to interfere with the order of the Court below and to set aside the judgment of conviction and confirmation - 1st question is affirmative - consideration of 2nd question does not arise in law.

  The impugned order passed by the lower Court as well as the First Appellate Court are hereby set aside - The revision petition is allowed.

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• 2019 (3) TMI 1942 - ITAT MUMBAI
  

  Revision u/s 263 by CIT - non recognition of revenue - Method of accounting - Non booking of sale of TDRs (Transferable Development Rights) received against the SRA Project - as per AO has failed to examine and conducted inquiries as regards the nature of TDRs and sale proceeds of TDRs vis-a-vis the agreement with SRA - credit of the receipt from sale of TDR to current liability awaiting the discharge of assessee’s total obligations under the slum rehabilitation project - HELD THAT:- The issue of income and receipt arising out of sale of TDR, the detailed thereof and the method of accounting for profit recognition adopted by the assessee were duly available before the AO. Hence from the above it is evident that Ld. CIT is totally incorrect in observing that the sale of TDR and the profit method of the assessee was not examined by the AO.

  Whether the method of accounting adopted by the assessee and accepted by the AO is a legally permissible one not? - We note that the observations of the revenue authority on the incorrectness of the method of accounting adopted by the assessee are not by reference to any Accounting Standards or any provision of the Act - AO has noted that the method of accounting adopted by the assessee cannot over ride the Income tax Act. Here we note that there is no specifications as to which provision of income tax provides that the method of accounting adopted by the assessee is incorrect. We find that the percentage completion method for revenue recognition in case of assessee engaged in real estate development is well recognized as per the ICAI guidelines as well as case laws in this regard. In this regard, we may refer that the Hon’ble Supreme Court explained the 'Project Completion Method or Completed Contract Method' and 'Percentage of Completion Method' in the case of C.I.T. Vs. Bilahari Investment Pvt. Ltd. [2008 (2) TMI 23 - SUPREME COURT] - Thus, we note that the adverse comments passed on the assessee’s method of accounting is in contravention to settled accounting principle and case laws.

  Assessee submission is quite germane that the sale of TDR cannot be considered in isolation of the assessee obligation under the SRA agreement to complete the slum rehabilitation project.

  The reading of the agreement in this regard clearly shows that assessee was under obligation to complete the slum rehabilitation project as per the agreement. The said agreement has to be considered on an overall basis and the construction of the parts of the agreement has to be done in a harmonious manner. As rightly contended by the Ld. Counsel of the assessee TDRs were meant to provide finance to the assessee company to complete the project. In such circumstances the assessee has credited the amount received on sale of TDR to current liability which is utilized in the development of the project - this treatment by the assessee finds support from ITAT decision in the case of Skylark Build [2012 (6) TMI 440 - ITAT, MUMBAI]

  The method adopted by the assessee and accepted by the assessing officer is legally permissible one. Once it is held that the method adopted is a legally permissible one, it has been held in the Catena of case laws that learned Commissioner of income tax cannot exercise of jurisdiction under section 263 of the act if he is of a different opinion.

  Thus the view adopted by the assessing officer is a permissible one. Hence, we are of the considered opinion that exercise of jurisdiction under section 263 of the IT Act by the learned Commissioner of income is liable to be quashed. - Decided in favour of assessee.

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• 2019 (3) TMI 1941 - ITAT AMRITSAR
  

  Reopening of assessment u/s 147 - ITO Phagwara jurisdiction to issue notice - HELD THAT:- As the term “Assessing Officer” used in Sec. 147 of the IT Act cannot be accorded any other meaning except that envisaged in Sec. 2(7A) as per which the same has to be construed as the AO vested with the relevant jurisdiction by virtue of directions or orders issued under sub-section (1) of subsection (2) of Sec. 120 or any other provision of the IT Act.

  There is neither anything borne from the records nor any material has been produced before us during the course of hearing of the appeal, which would reveal that the ITO, Ward-4, Phagwara was at the time of issuing the notice under Sec. 148 of the IT Act was exercising either exclusive or concurrent jurisdiction over the case of the assessee. On the basis of our aforesaid observations, it can safely be concluded that the notice issued under Sec. 148, dated 27.03.2015 by the ITO, Ward- 4, Phagwara who was not vested any jurisdiction over the case of the assessee would have no existence in the eyes of law. We thus in the backdrop of the aforesaid facts are constrained to observe that the assessment framed by the ITO, Ward-3, Phagwara under Sec. 147 r.w.s 143(3) of the IT Act, dated 29.03.2016 in the absence of a valid notice issued under Sec. 148 cannot be sustained and is liable to be quashed.

  As we have quashed the assessment framed by the A.O under Sec. 147 r.w.s. 143(3), dated 29.03.2016 for want of jurisdiction, therefore, we refrain from adverting to and therein adjudicating the merits of the addition made in the hands of the assessee. - Decided in favour of assessee.

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• 2019 (3) TMI 1940 - NATIONAL COMPANY LAW TRIBUNAL, MUMBAI BENCH
  

  Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Corporate Debtor contends that the Company’s stock (Diamonds), which was kept as security with the bank has been misappropriated/lost due to bank’s fraud/ gross negligence - Financial Creditors - Non-Performing Assets - existence of debt and dispute or not - HELD THAT:- This Bench finds that the counter claim filed by the Corporate Debtor in DRT is no bar to proceed with this petition keeping in view the fact that the Adjudicating Authority is not bound to ascertain the exact amount of claim at the stage of admission.

  In V.R. Polyfab Pvt. Ltd. vs. Sadhbhav Enterprise Pvt. Ltd. [2017 (9) TMI 1859 - NATIONAL COMPANY LAW TRIBUNAL, AHMEDABAD], decided on 19th September, 2017, NCLT, Ahmedabad Bench, gave a similar view on this question observing that even assuming that the Corporate Debtor is entitled for certain amount from the Financial Creditor, the same can only be treated as a set off or counter claim and therefore it cannot be treated as a ‘dispute’ relating to financial debt due to the financial creditor from the Corporate Debtor. Further, it observed that though Corporate Debtor has pleaded counter-claim or set-off, but it cannot be said that there is no default in repayment of financial debt by Corporate Debtor.

  Debt and default - HELD THAT:- The Corporate Debtor does not deny the same. Financial Facilities have been duly granted and the amounts have been disbursed. There has been a default in repayment and the same has been admitted to some extent. This can be said in view of the reply letter dated 09.05.2016, wherein the Company replied to the notice of ICICI Bank saying that it was facing temporary financial difficulties and that they were taking steps towards regularizing its loan account. It is worth to note that there is no denial of the debt amount by the Corporate Debtor - Also, the pendency of proceedings in DRT is no bar to the present Section 7 proceedings in view of Section 238 of the Code. The Petitioner’s claim of existence of debt and default has been corroborated with ample evidence and is enough to hold a view in its favour.

  The Financial Creditor has established that the loan was duly sanctioned and duly disbursed to the Corporate Debtor but there has been default in payment of Debt on the part of the Corporate Debtor - the nature of Debt is a “Financial Debt” as defined under section 5 (8) of the Code. It has also been established that admittedly there is a “Default” as defined under section 3 (12) of the Code on the part of the Debtor.

  The Petitioner has not received the outstanding Debt from the Respondent and that the formalities as prescribed under the Code have been completed by the Petitioner, this Petition deserves ‘Admission’ - Petition admitted - moratorium declared.

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• 2019 (3) TMI 1939 - NATIONAL COMPANY LAW TRIBUNAL NEW DELHI
  

  Seeking recall of order - the principles laid down by Hon'ble the Supreme Court in the case of Forech India Ltd. v. Edelweiss Assets Reconstruction Company Ltd. [2019 (1) TMI 1442 - SUPREME COURT] were not placed - HELD THAT:- Mere appointment of Provisional Liquidator would not denude the NCLT of its jurisdiction under the provisions of Insolvency & Bankruptcy Code which are considered to be an independent proceeding. Therefore, in view of the aforesaid legal position no doubt is left that the petition could not have been disposed of on the ground of that Hon'ble High Court where has appointed the Provisional Liquidator in a winding up petition.

  The order is recalled. As a necessary consequence the CP. No. (IB)-104(PB)/2018 is restored. The petition stands already admitted on 30.05.2018 and Mr. Alok Kumar Kuchhal has been appointed as the Resolution Professional. Resolution Professional shall proceed from the stage the proceedings were left.

  Application disposed off.

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