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2013 (4) TMI 911
Issues Involved:
The judgment involves the following issues:
1. Whether the Appellate Tribunal erred in deleting the addition made on account of the sale of Ampad Land?
2. Whether the order of the Appellate Tribunal failed to consider the dates of "cash receipts" mentioned in seized documents?
Issue 1: Addition on Account of Sale of Ampad Land
The Respondent assessee, along with family members, owned land at Ampad and was subjected to search proceedings. Documents seized during the search indicated a total receipt of Rs. 5.24 Crores for the sale of the land from Kanubhai Patel. The Assessing Officer added the entire amount as "unaccounted cash credit" of the assessee, alleging it was unaccounted. However, the CIT [A] deleted the addition, stating that the land was subsequently sold in 2009-10 to various parties for Rs. 1.80 Crores, with short term capital gain offered for tax in that year. The Tribunal upheld the CIT [A]'s decision, considering the facts and the disclosed income in the relevant assessment year.
Issue 2: Consideration of Cash Receipts
The Assessing Officer disregarded the assessee's explanation that the amount received from Kanubhai Patel for the Ampad land sale, which was later canceled, was returned. The Tribunal found that the entire amount was shown as undisclosed income in 2009-10 and rejected the double taxation of the same amount for 2007-08 and 2008-09. The Tribunal emphasized that the land was sold only once, with short term capital gain disclosed, and any attempt to tax the entire amount again would result in double taxation.
In conclusion, the Tribunal dismissed the Tax Appeal, stating that the issue was fact-based, and no legal question arose. The judgment affirmed the decision to exclude the disputed income from the total income for the relevant assessment year.
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2013 (4) TMI 910
Issues Involved:
(I) Whether in the facts and circumstances of the case, the decree of injunction could have been granted in favour of plaintiffs-respondents by Lower Appellate Court?
(II) Whether the injunction, in the facts and circumstances of the case, was barred by Section 41 of Specific Relief Act, 1963?
Summary:
Issue I: Decree of Injunction by Lower Appellate Court
The plaintiff-respondent, Anil Kumar Singh Yadav, was appointed on an ad hoc basis as an Assistant Teacher in Gandhi Rashtriya Inter College, Sadalpur, Varanasi, due to a vacancy created by a promotion. The appointment was made u/s 18 of U.P. Secondary Education Services Selection Board Act, 1982. The documents were forwarded to the District Inspector of Schools (DIOS) for approval, but no approval was received, leading to non-payment of salary and the institution of the suit. The Trial Court found the appointment illegal as it was not made in accordance with Section 18 and dismissed the suit. The plaintiff appealed, and the Lower Appellate Court (LAC) allowed the appeal, directing the defendants to allow the plaintiff to continue in service and pay his salary.
The High Court found that the LAC's understanding was erroneous and illegal. The procedure prescribed under para 2 of the U.P. Secondary Education Services Commission (Removal of Difficulties) (Second) Order, 1981, was not followed. The appointment was made in violation of the mandatory procedure, rendering it void ab initio. The High Court cited several precedents, including Radha Raizada v. Committee of Management and Prabhat Kumar Sharma v. State of U.P., to support its conclusion that the appointment was illegal and conferred no right to the incumbent.
Issue II: Bar of Injunction by Section 41 of Specific Relief Act, 1963
The High Court held that an injunction could not be granted to require the defendants to commit a breach of law, as such an injunction is barred by Section 41(h) of the Specific Relief Act, 1963. The suit for enforcement of a contract of personal service is not maintainable unless specific conditions are met, which were not present in this case. The High Court referred to the principles laid down in Executive Committee of U.P. State Warehousing Corporation v. C.K. Tyagi and other relevant cases, emphasizing that a contract of personal service cannot be specifically enforced except in certain well-recognized exceptions.
Conclusion:
The High Court answered question No. 1 in the negative, against the plaintiff-respondent, and question No. 2 in the affirmative, in favor of the defendants-appellants. The appeal was allowed, the judgment and decree dated 22.12.2000 passed by the Lower Appellate Court were set aside, and the judgment and decree dated 31.01.2000 passed by the Trial Court were restored and confirmed. The Original Suit No. 839 of 1996 filed by the plaintiff-respondent was dismissed, and the defendants-appellants were entitled to costs throughout.
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2013 (4) TMI 908
Issues Involved:
1. Whether Thayanayagy Ammalle had acquired absolute title over the suit property.
2. Whether the suit was maintainable without seeking any consequential relief.
Summary:
Issue 1: Absolute Title of Thayanayagy Ammalle
The Supreme Court examined whether Thayanayagy Ammalle had acquired an absolute title over the suit property. The High Court had held that she had acquired absolute title and thus, the sale deed dated 16.7.1959 executed in favor of Vedavalliammalle was valid. However, the Supreme Court found that the High Court's finding was not based on any evidence and reversed it, holding that Thayanayagy Ammalle was only a life estate holder. This conclusion was supported by the fact that the Hindu Succession Act, 1956, was extended to Pondicherry only at a later stage, and the customary Hindu Law applicable at the time did not confer absolute title to a Hindu widow with a life estate.
Issue 2: Maintainability of the Suit Without Consequential Relief
The Supreme Court addressed whether the suit was maintainable without seeking consequential relief. The trial court had dismissed the suit on the grounds that the Appellant/Plaintiff had not sought the consequential relief of delivery of possession. The First Appellate Court reversed this decision, stating that since the property was in possession of tenants, the Appellant could seek possession under the Pondicherry Non-Agricultural Kudiyiruppudars (Stay of Eviction Proceedings) Act of 1980. However, the High Court reinstated the trial court's decision, emphasizing that the suit for declaration was not maintainable without seeking consequential relief, as required by the proviso to Section 34 of the Special Relief Act, 1963.
The Supreme Court upheld the High Court's view, citing precedents that a mere declaratory decree without consequential relief does not provide the needed relief and is generally non-executable. The Court emphasized that the purpose of the proviso to Section 34 of the Act 1963 is to avoid multiplicity of proceedings and loss of court fees. Since the Appellants/Plaintiffs did not amend the plaint to include the relief of possession, the suit was not maintainable.
Conclusion:
The appeals were dismissed, affirming that Thayanayagy Ammalle was only a life estate holder and that the suit was not maintainable without seeking consequential relief.
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2013 (4) TMI 907
Issues involved: Assessment of income u/s 143(3) - Estimation of profits u/s 145 - Appeal against CIT(A) order.
Assessment of income u/s 143(3): The assessee, engaged in retail trade in liquor, failed to produce books of account and supporting evidence during assessment proceedings, leading the Assessing Officer to estimate income at 9% of gross receipts. The CIT(A) directed the Assessing Officer to estimate net profit at 5% of purchases or stock put for sale, based on previous ITAT decisions. The Revenue appealed, arguing against this estimation method.
Estimation of profits u/s 145: The CIT(A) relied on the ITAT decision in the case of Amaravathi Wine Shop, directing the Assessing Officer to estimate net profit at 5% of purchases or stock put for sale, ensuring assessed income not less than returned income. The Revenue contended that this estimation method was not supported by material on record.
Appeal against CIT(A) order: The ITAT upheld the CIT(A) order, stating that the issue was covered by previous Tribunal decisions. The ITAT found no fault in the CIT(A)'s direction to estimate net profit at 5% of purchases or stock put for sale, ensuring assessed income not less than returned income. The Revenue's appeal was dismissed.
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2013 (4) TMI 906
The Karnataka High Court quashed the order dismissing appeals due to delay, citing non-application of mind. The case was remitted for fresh consideration, with the opportunity for the petitioners to provide additional affidavits. The question of limitation was left open.
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2013 (4) TMI 905
Issues Involved:
1. Whether the explosive suppliers had indulged in fixation of bid prices under an agreement.
2. Whether the explosive suppliers had engaged in the act of controlling and limiting the supply of explosives.
3. Whether the explosive suppliers had caused manipulation of the bidding process in contravention of Section 3(3) read with Section 3(1) of the Competition Act, 2002.
Summary:
Issue 1: Fixation of Bid Prices
The CCI concluded that although the bids for the years 2004-05, 2005-06, and 2006-07 were identical, indicating a lack of independent decision-making and a meeting of minds among the explosive suppliers, these issues occurred before the notification of Sections 3 and 4 of the Act. Therefore, the appellants could not be held guilty for violation of these sections. The CCI also considered a letter dated 13.10.2009 from EMWA but found it insufficient to establish collective price-fixing.
Issue 2: Controlling and Limiting Supply
The CCI found that although explosive suppliers had previously stopped supplies, such actions occurred before Sections 3 and 4 were effective. The CCI reviewed letters from 2010 and found no evidence of a deliberate limitation of supplies under the agreements. The CCI noted that some suppliers had fulfilled more than 90% of their contractual obligations, and the letters cited by CIL did not indicate any anti-competitive agreement. Thus, the appellants were exonerated from contravening Section 3(3)(b).
Issue 3: Manipulation of Bidding Process
The CCI determined that the collective boycott of the Electronic Reverse Auction on 4th and 5th January 2010 constituted a concerted action among the appellants, resulting in bid rigging and manipulation of the bidding process, violating Section 3(3)(d) of the Act. The CCI imposed a penalty of 3% of the average turnover of the appellants under Section 27(b).
Common Issues Raised by Appellants:
- Denial of Natural Justice: The appellants argued that they were not supplied with the objections and documents from CIL, causing denial of natural justice. The Tribunal found that the appellants had adequate notice and failed to appear or request the documents, thus rejecting this contention.
- Selective Prosecution: The appellants claimed arbitrary selection by CIL. The Tribunal found no fault in CIL proceeding against those for whom it had evidence.
- Procedure for Inquiry: The appellants argued that the CCI should have initiated further inquiry under Section 26(7) after the DG's report. The Tribunal held that the CCI has discretion to pass an order under Section 26(6) without further inquiry if it disagrees with the DG's report.
- Bias Allegation: Some appellants argued that Shri H.C. Gupta should have recused himself due to potential bias. The Tribunal rejected this, noting no evidence of bias and that the issue was not raised at the earliest opportunity.
Penalty:
The Tribunal noted the need to consider mitigating factors such as this being the first breach, the participation in the subsequent auction, and uninterrupted supplies. The penalties were reduced to 10% of the original penalty imposed by the CCI. The appeals were dismissed on merits, with the penalties modified accordingly.
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2013 (4) TMI 904
Issues Involved:
1. Legislative competence to tax mobile towers.
2. Validity of the statutory provisions under the GPMC Act.
3. Mechanism for collection of property tax on mobile towers.
Summary:
Issue 1: Legislative Competence to Tax Mobile Towers
The petitioners challenged the authority of local bodies to tax mobile towers, arguing that mobile towers are not buildings and thus fall outside the legislative competence of the State Legislature u/s Entry 49 of List II of the Seventh Schedule of the Constitution. The court examined whether mobile towers could be considered buildings and thus be taxed under this entry.
The court held that mobile towers are not buildings as they do not fit the common understanding of the term "building," which typically includes structures with a roof and walls intended for habitation or storage. The court concluded that the State Legislature did not have the competence to enact the law permitting the collection of taxes on towers but held that the cabins associated with these towers could be considered buildings and thus be taxed.
Issue 2: Validity of the Statutory Provisions under the GPMC Act
The petitioners contended that Section 145A of the GPMC Act, which provides for taxing mobile towers, was ultra vires Articles 14, 243, and 265 of the Constitution. The court examined whether the statutory provisions were valid, considering that the Indian Telegraph Act, 1885, already occupied the field of telegraphs, including mobile towers.
The court found that the Indian Telegraph Act, 1885, and the GPMC Act operate in different fields. The former deals with the establishment, maintenance, and working of telegraphs, while the latter pertains to municipal governance and taxation. The court held that the State Legislature could enact laws for taxing structures like cabins associated with mobile towers under Entry 49 of List II but not the towers themselves.
Issue 3: Mechanism for Collection of Property Tax on Mobile Towers
The petitioners argued that the mechanism for collecting property tax on mobile towers was flawed, as proper rules had not been framed following the procedure provided under respective Acts. They contended that some local authorities had raised property tax bills without any authority and relied on government resolutions struck down by the court.
The court did not find it necessary to examine the mechanism further, given its conclusion on the legislative competence and validity of the statutory provisions. The court declared the tax bills raised by various local bodies invalid but allowed them to issue revised bills for taxing the cabins.
Conclusion:
The court held that the provisions of the GPMC Act allowing the taxation of mobile towers were ultra vires the Constitution. However, the cabins associated with these towers could be taxed as buildings. The court invalidated the tax bills raised by local bodies but permitted them to issue revised bills for the cabins. The petitioners were entitled to a refund of the tax already paid, limited to one year before filing the petition.
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2013 (4) TMI 903
Whether there can be more than one FIR in relation to the same incident or different incidents arising from the same occurrence - In the instant case, upon CBI’s own finding that the offence covered by the Second FIR is part of the same conspiracy and culminated into the same series of acts forming part of the same transaction in which the offence alleged in the first FIR was committed. It is also pointed out that it is the case of the CBI itself before this Court that even the charges will have to be framed jointly and one trial will have to be held as contemplated under Section 220 of the Code of Criminal Procedure, 1973 (in short ‘the Code’).Finally, it is highlighted that the competent jurisdictional court has already taken cognizance of all the three alleged killings in the chargesheet/challan filed by the CBI in the first FIR itself.
HELD THAT:- filing of the second FIR and fresh charge sheet is violative of fundamental rights under Article 14, 20 and 21 of the Constitution since the same relate to alleged offence in respect of which an FIR had already been filed and the court has taken cognizance. This Court categorically accepted the CBI’s plea that killing of Tulsiram Prajapati is a part of the same series of cognizable offence forming part of the first FIR and in spite of the fact that this Court directed the CBI to “take over” the investigation and did not grant the relief as prayed, namely, registration of fresh FIR, the present action of CBI filing fresh FIR is contrary to various judicial pronouncements.
the second FIR filed by the CBI to be quashed. As a consequence, the charge sheet filed in pursuance of the second FIR, be treated as a supplementary charge sheet in the first FIR.
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2013 (4) TMI 902
Mis-declaration of goods - it was alleged that certain products manufactured by the appellant were cosmetic products, not ayurvedic medicines - certain clearances made to related party - Held that:- There is no dispute about the fact that Apex Court had given certain directions for re-quantification of duty in para 33 of the judgment - From perusal of the impugned order, it is clear that re-quantification has not been done in terms of this order, while the appellant plead that all the necessary information had been provided.
The matter is once again remanded to the Commissioner for re-quantification of the duty demand strictly in term of the directions of the Apex Court - appeal allowed by way of remand.
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2013 (4) TMI 901
Issues Involved:
The judgment deals with the challenge to a reassessment notice issued under section 148 of the Income-tax Act, 1961 for the assessment year 2001-02 by a company under the Companies Act, 1956. The main issue is whether the Department can reopen an assessment done pursuant to directions issued by the Additional Commissioner under section 144A.
Details of the Judgment:
Relevant Facts:
During the relevant assessment year, the petitioner company incurred losses in share dealing and speculation business, along with capital gains and dividend income. The petitioner filed a return showing total income, and the Assessing Officer proposed applying certain provisions, which the petitioner objected to. The Additional Commissioner under section 144A directed the Assessing Officer not to treat certain losses as speculation losses.
Petitioner's Contentions:
The petitioner argued that the Assessing Officer cannot reopen the assessment based on the same grounds after directions under section 144A were issued. They contended that the order under section 144A had finality and was binding on the Assessing Officer.
Respondent's Arguments:
The respondents justified issuing the notice under section 148, stating that the purpose of section 144A was limited to assessment, and the notice was justified as it raised a fresh cause of action.
Court's Analysis:
The Court examined section 144A, which grants the Joint Commissioner the discretion to issue binding directions to guide the Assessing Officer for completing the assessment. The Court noted that the Assessing Officer was trying to reopen the assessment on the same grounds as before the order under section 144A was passed, indicating a mere change of opinion.
Legal Precedent:
The Court referred to a previous judgment highlighting that the Assessing Officer cannot reopen an assessment based on the same facts once a hierarchy of tribunals has given a finding. The Court emphasized the binding effect of the directions under section 144A on the Assessing Officer.
Judgment:
The Court held that since the Department did not revise the order passed under section 144A, the notice under section 148 could not be sustained. The impugned notice was set aside and quashed, along with all consequential proceedings. The writ petition was allowed with no order as to costs.
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2013 (4) TMI 900
Issues Involved:
1. Maintainability of the suit under Order 37 of the CPC.
2. Territorial jurisdiction of the Court.
3. Limitation period for filing the suit.
4. Acknowledgment of debt by the defendant.
5. Disputes regarding the quality and quantity of goods supplied.
6. Claim for interest by the plaintiff.
Summary:
1. Maintainability of the Suit under Order 37 of the CPC:
The plaintiff instituted the suit u/s Order 37 of the CPC for recovery of Rs. 1,49,21,015/- due from the defendant towards invoices for Cold Rolled Stainless Steel Coils sold, supplied, and delivered by the plaintiff. The plaintiff also claimed Rs. 48,33,765/- towards interest @ 12% per annum from the due date of payment of each invoice till the date of institution of the suit.
2. Territorial Jurisdiction of the Court:
The defendant contested the territorial jurisdiction of the Court, arguing that all transactions and payments occurred outside Delhi. The plaintiff invoked the doctrine of "debtor must seek creditor," citing various judgments to support that the place where payments are made or required to be made is relevant for determining territorial jurisdiction. The Court held that the registered office of the plaintiff being at Delhi and the legal notice demanding payment being issued from Delhi, the Courts at Delhi have jurisdiction.
3. Limitation Period for Filing the Suit:
The defendant argued that the suit is barred by time, having been filed beyond three years from the date of the invoices. The Court, however, satisfied itself that the claim in the suit is within time, especially considering the Minutes of the meeting held on 02.06.2009, where the defendant acknowledged the liability.
4. Acknowledgment of Debt by the Defendant:
The plaintiff presented Minutes of a meeting held on 02.06.2009, where the defendant agreed to reconcile the account statement and acknowledged the old pending payment of Rs. 1,49,21,015/-. The Court found that the defendant's acknowledgment of liability in the said meeting negated any earlier grievances regarding the goods supplied.
5. Disputes Regarding the Quality and Quantity of Goods Supplied:
The defendant raised multiple disputes regarding short supply, excess supply, defective goods, and high prices. However, the Court noted that these issues were not pressed by the defendant's counsel during arguments, likely due to the acknowledgment of liability in the meeting on 02.06.2009. The Court found the defendant's objections to be vexatious and without basis.
6. Claim for Interest by the Plaintiff:
The Court did not award interest @ 12% per annum from the date of each invoice as claimed by the plaintiff. Instead, it awarded interest @ 10% per annum from 02.06.2009 till the date of institution of the suit, pendente lite, and for three months thereafter. If the defendant fails to pay the decretal amount within three months, interest @ 18% per annum will be applicable till realization.
Judgment:
The application for leave to defend was dismissed. The suit was decreed in favor of the plaintiff for Rs. 1,49,21,015/- with interest @ 10% per annum from 02.06.2009 till the date of institution of the suit, pendente lite, and for three months thereafter. Post three months, interest @ 18% per annum will be applicable till realization. The plaintiff was also entitled to costs as per schedule. The decree sheet was ordered to be drawn.
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2013 (4) TMI 899
Issues Involved:
1. Whether the stay order of the Tribunal was flouted by the assessee.
2. Whether the stay order of the Tribunal was flouted by the department.
3. If the department flouted the stay order, whether the action was bona fide or mala fide.
4. Whether the Tribunal has the power to direct a refund.
5. Ensuring safeguards to protect the interests of the Revenue.
Issue-wise Detailed Analysis:
1. Whether the stay order of the Tribunal was flouted by the assessee:
The Tribunal's order dated 13-12-2012 granted a stay of recovery subject to the assessee depositing Rs. 2.50 crores and furnishing a bank guarantee by 31-12-2012. Additionally, the assessee was required not to seek any adjournment and get the appeal finalized on 13-01-2013 or any subsequent date. The conditions regarding the deposit and bank guarantee were fully complied with by the assessee. On 16-01-2013, the appeal was adjourned due to the awaited Special Bench order on the AMP issue. The Tribunal held that the adjournment was in conformity with judicial propriety and not an act of seeking adjournment by the assessee. Thus, the stay order was not flouted by the assessee.
2. Whether the stay order of the Tribunal was flouted by the department:
The department issued notices under sections 221(1) and 226(3) to the assessee and its bank, respectively, leading to the collection of amounts stayed by the Tribunal. The Tribunal concluded that the stay order was indeed flouted by the department.
3. If the department flouted the stay order, whether the action was bona fide or mala fide:
The Tribunal considered arguments from both sides and determined that the department's action was bona fide. The officers acted on a bona fide belief that they were required to recover the amounts. Efforts were made to obtain information regarding the adjournment, and the confusion arose from a misunderstanding of the relevance of the wording in the order-sheet dated 16-01-2013. The Tribunal acknowledged the pressures and apprehensions faced by the officers, leading to the conclusion that the action was bona fide.
4. Whether the Tribunal has the power to direct a refund:
The Tribunal referred to several judgments, including CIT v. Bansi Dhar & Sons and M.K. Mohammed Kunhi, to affirm that it has the power to direct a refund. Section 254 of the Income-tax Act grants the Tribunal the power to pass orders necessary to maintain judicial balance, which includes directing a refund in appropriate cases. The Tribunal emphasized that it has the authority to remedy any wrong committed in proceedings before it and to pass orders for the ends of justice or to prevent abuse of process.
5. Ensuring safeguards to protect the interests of the Revenue:
The Tribunal noted that the bank guarantee furnished by the assessee amounting to Rs. 208 crore was in the possession of the department, ensuring the interest of the Revenue was secured. Therefore, the Tribunal directed the Revenue to refund the amounts collected in violation of the stay order by 18-04-2013.
Conclusion:
The Tribunal allowed the assessee's petition, directing the Revenue to refund the amounts collected in violation of the stay order dated 13-12-2012. The Tribunal emphasized the need for judicial propriety and the importance of creating a conducive atmosphere for officers to perform their statutory functions confidently and without undue pressure.
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2013 (4) TMI 898
Issues involved: Appeal against order of Income Tax Appellate Tribunal regarding additions to returned income for Assessment Year 2004-05 by Assessing Officer.
Addition of unexplained share capital and premium:
The Tribunal and Commissioner found accounts maintained by the assessee to be in order, reflecting true income. Increase in turnover and GP rate were noted, indicating no income suppression. Tribunal's findings based on relevant material were upheld, with no substantial question of law identified. Citing CIT vs Lovely Exports, it was held that share application money cannot be added to the income of the assessee company.
Disallowance under various heads:
The Tribunal's decision to delete disallowance made by the Assessing Officer was upheld. The Tribunal found no material defects pointed out by the Assessing Officer to invoke Section 145(3) of the Income Tax Act, 1961. Despite defects in account books, the Tribunal considered the past history of the assessee, concluding that income was not suppressed. No perversity in the Tribunal's findings was identified, leading to the dismissal of the appeal.
Conclusion:
The appeal was dismissed summarily as no substantial question of law was found. The judgment referenced the case of CIT vs Lovely Exports, supporting the assessee's position regarding share application money.
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2013 (4) TMI 897
Exemption for Trusts - Statutory Accumulation of Income u/s 11 (1)(a) - To be computed on Gross inocme or net income - Assessee was a religious and charitable trust and had total income of ₹ 35,60,82,101/- against which it had applied income amounting to ₹ 58,09,87,048/-. A.O. computed the assessment at nil income as application of income including the capital expenditure was more than the income earned. Assessee contended before CIT (A) that AO had not allowed the statutory accumulation of 25% of the gross income which was required to be carried forward for application in the subsequent year u/s 11(1)(a). - HELD THAT:- Under the provisions of section 11(1) (a), the assessee is entitled to accumulate 25% of the income and therefore even if the assessee had spent only 75% of the income, the entire income would be exempted. But in this case, there was no income left that could be accumulated. In fact, there was deficit, therefore, the claim of the assessee is rejected.
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2013 (4) TMI 896
Advertisement issued by the Uttarakhand Board of Technical Education as published in the newspaper “Amar Ujala” - recruitment to the post of Physiotherapist - Held that:- Having taken part in the process of selection with full knowledge that the recruitment was being made under the General Rules, the respondents had waived their right to question the advertisement or the methodology adopted by the Board for making selection and the learned Single Judge and the Division Bench of the High Court committed grave error by entertaining the grievance made by the respondents.
We are also prima facie of the view that the learned Single Judge committed an error by holding that despite the non obstante clause contained in Rule 2 of the General Rules, the Special Rules would govern recruitment to the post of Physiotherapist. However, we do not consider it necessary to express any conclusive opinion on this issue and leave the question to be decided in an appropriate case.
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2013 (4) TMI 895
The Calcutta High Court ordered the company to pay the petitioner Rs. 1.15 lakh in three equal monthly instalments starting from April 30, 2013. If paid as agreed, the petition will be permanently stayed; otherwise, it will be advertised in The Statesman and Bartaman. Publication in the Official Gazette is not required.
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2013 (4) TMI 894
Issues: Refund claim denied due to lack of co-relation of input credit with exported goods.
Analysis:
The appellants, engaged in manufacturing printed books, sought a refund of duty paid on inputs used in the production of export goods. However, the refund claim was rejected on the grounds that they failed to establish a direct correlation between the input credit availed and the goods exported. The appellate tribunal noted the crucial aspect of co-relation of Cenvat Credit with exported goods, emphasizing the need for the adjudicating authority to examine this issue. Consequently, the tribunal set aside the impugned orders and remanded the matter back for further evaluation on the co-relation of input credit with goods exported, keeping all issues open for consideration. The appeal was disposed of accordingly.
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2013 (4) TMI 893
Issues Involved:
1. Limitation under section 536(2) of the Companies Act, 1956.
2. Bona fide nature of the transaction.
3. Validity of the mortgage in favor of the State Bank of India.
4. Discrepancies in the description of the property.
5. Non-payment of bid amount by the successful bidder within the stipulated time.
Summary:
Issue of Limitation:
The court examined whether the application under section 536(2) is barred by limitation. The Companies Act does not prescribe a specific period of limitation for such applications. However, Article 137 of the Limitation Act, 1963, which provides a three-year period for applications for which no period is prescribed, applies. The applicant was aware of the winding-up proceedings by July 2000 or January 2001 but filed the application only in January 2011. Therefore, the application is barred by limitation.
Issue of Bona Fide Nature of the Transaction:
The court considered whether the applicant was a bona fide transferee. The applicant obtained leasehold rights from the company in liquidation during the pendency of winding-up proceedings. The court found several discrepancies and suspicious circumstances, such as the retrospective effect of the lease and the payment of Rs. 30 lakhs by Henkel Spic India Ltd., not the applicant. The court concluded that the applicant is not a bona fide purchaser.
Issue of Validity of the Mortgage in Favor of the State Bank of India:
The applicant contended that the mortgage was invalid as the original title deeds were not deposited with the bank. The court found that the applicant is not competent to raise this objection and that the bank's claim of losing the original documents due to handling by various persons does not invalidate the mortgage. The mortgage was created and registered with the Registrar of Companies, confirming its validity.
Issue of Discrepancies in the Description of the Property:
The applicant argued that there were discrepancies in the description of the property, particularly the built-up area. The court found that the applicant had obtained additional leasehold rights from the original owner, which explained the increase in the built-up area. The court concluded that the applicant cannot take advantage of any alleged discrepancy.
Issue of Non-payment of Bid Amount by the Successful Bidder within the Stipulated Time:
The auction purchaser failed to pay the balance amount within the stipulated 15 days, violating condition No. 3 of the auction notice and Rule 57(2) of the Second Schedule to the Income-tax Act, 1961. The court held that the auction sale is liable to be set aside. The fourth respondent (auction purchaser) is given liberty to apply for a refund of the deposited amount, subject to the deduction of auction expenses.
Conclusion:
The court dismissed the application, rejecting the prayer for ratification of the transfer of leasehold rights and holding the applicant not to be a bona fide transferee. The auction in favor of the fourth respondent is set aside due to non-compliance with payment terms. The mortgage in favor of the State Bank of India is upheld. The Recovery Officer is permitted to bring the property to sale again.
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2013 (4) TMI 892
Issues Involved:1. Disallowance of deduction u/s 80-IB(10) for the housing project "Shri Vijaya Rengam." 2. Addition of unaccounted cash receipts for specific services and extra work. Summary:Issue 1: Disallowance of deduction u/s 80-IB(10) for the housing project "Shri Vijaya Rengam"2. The assessee's grievance concerns the disallowance of its claim for deduction u/s 80-IB(10) for the housing project "Shri Vijaya Rengam" for the assessment years 2004-05 to 2007-08. 4. The Assessing Officer (A.O.) denied the deduction on the grounds that the assessee was not the owner of the land, acted merely as a contractor, and one of the flats exceeded 1500 sq.ft. Additionally, the built-up area of the commercial portion was 3719 sq.ft., violating sub-clauses (c) and (d) of Section 80-IB(10). 5. The CIT(Appeals) upheld the A.O.'s decision, stating that the benefit u/s 80-IB(10) was available only to a landowner who was also a developer. 6. The assessee argued that it was developing the housing project, deploying its resources, and finding buyers, and ownership of the land was not necessary for claiming the deduction. Reliance was placed on the decision of the Hon'ble jurisdictional High Court in CIT v. Sanghvi and Doshi Enterprise. 7. Regarding the flat exceeding 1500 sq.ft., the assessee contended that the measurement included car parking space, which should not be considered part of the built-up residential area. For the commercial area exceeding 2000 sq.ft., the assessee argued that there was no restriction on commercial area when the project started, and the restriction was introduced only from 1.4.2005. 9. The Tribunal noted that the assessee was the developer of the project, and the A.O.'s refusal to follow the Tribunal's decision in Radhe Developers v. ITO was inappropriate. The Tribunal held that there is no requirement for the developer to be the landowner to claim deduction u/s 80-IB(10). 10. The A.O. himself found that the flat's built-up area was less than 1500 sq.ft. when excluding the car parking area, thus not violating clause (c) of Section 80-IB(10). 11. The Tribunal observed that the commercial area of 2567 sq.ft. was only 3.81% of the total plinth area, and prior to 1.4.2005, there was no restriction on commercial area in a housing project. The Tribunal relied on the decision in Arun Excello Foundations Pvt. Ltd. and held that setting apart 3.81% for commercial space does not deprive the assessee of the deduction u/s 80-IB(10). 12. The Tribunal concluded that the substituted sub-section (10) of Section 80-IB, effective from 1.4.2005, applies only to projects initiated after that date. The assessee's project, having started before this date, should be governed by the earlier law. 13. The Tribunal directed the A.O. to grant the deduction claimed u/s 80-IB(10) for the project "Shri Vijaya Rengam" for the assessment years 2004-05 to 2007-08. Issue 2: Addition of unaccounted cash receipts for specific services and extra work15. The Revenue's appeals for the assessment years 2002-03, 2004-05, 2006-07, 2007-08, and 2008-09 involved additions for unaccounted cash receipts for specific services and extra work. 16. During the search proceedings, booking forms for the project "Sri Lambodara" revealed various amounts collected from customers under different heads, including extra work. 17. The assessee provided similar details for other projects during post-search proceedings, showing amounts collected for extra work and other services. 18. The A.O. added the total unaccounted receipts of Rs. 2,79,83,146/- to the assessee's income, as these were not reflected in the regular books of accounts. 19. The CIT(Appeals) found that the assessee had collected specific sums for specific services and provided affidavits from customers. The CIT(Appeals) held that collections for specific services could not be considered income and scaled down the addition for extra work to 8% of the receipts. 22. The Revenue argued that the assessee did not produce proof of expenses incurred from the collections and that the CIT(Appeals) gave relief without corroborating evidence. 23. The assessee contended that the collections were for statutory payments and extra work, supported by affidavits from flat owners, and these were not part of the regular income. 24. The Tribunal found that the assessee had produced records showing payments made from the service charges received and affidavits from flat owners. The CIT(Appeals) was justified in not adding the service charges as income. 25. Regarding extra work, the Tribunal held that considering the entire amount as income was unfair, and the CIT(Appeals) was justified in estimating 8% of the receipts as income. 27. The Tribunal dismissed the Revenue's appeals for all the years. 28. In conclusion, the assessee's appeals were allowed, and the Revenue's appeals were dismissed. Order pronounced on 11th April 2013, at Chennai.
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2013 (4) TMI 891
Issues involved: Sealing of business premises by State Authorities, challenge to SEBI order, jurisdiction of SEBI, protection of investors' interests.
Sealing of Business Premises: Three writ petitions filed by a company operating in different districts challenging the sealing of their business premises by State Authorities. Petitioners argue that the action is without legal authority and seek to have their premises unsealed. SEBI had directed the company to wind up operations and return investors' money within 3 months, which has not been done. Petitioners claim that the final SEBI order is under challenge in Kolkata High Court.
Challenge to SEBI Order: SEBI, through its counsel, asserts that the petitioners have not complied with the final orders to wind up operations and return investors' money. SEBI maintains that it has the authority under the Act of 1992 to take necessary steps for refunding investors' money and can pursue legal recourses against non-compliant companies like the petitioners.
Jurisdiction of SEBI: SEBI argues that the petitioners should be under its jurisdiction and subject to its actions as per the Act of 1992. SEBI is entitled to take steps available in law to protect investors' money and ensure compliance with its directives. The court is inclined to dismiss the writ petitions and directs the petitioners to cooperate with SEBI in any proceedings related to the SEBI's orders.
Protection of Investors' Interests: State Authorities maintain that the actions taken were to safeguard the interests of investors who were allegedly duped by the petitioners. An FIR has been registered against the petitioners for continuing business despite SEBI orders. The State submits that the petitioners should be under SEBI's jurisdiction for necessary actions to protect investors' money and enforce compliance with SEBI directives. SEBI may allow the return of investors' money by permitting the petitioners to reopen their business premises or take other lawful steps.
Conclusion: The court dismisses the writ petition, directing the petitioners to cooperate with SEBI in compliance with its orders. The decision is based on the petitioners' failure to return investors' money and the need for SEBI to take appropriate actions under the Act of 1992.
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