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Showing 101 to 120 of 2184 Records
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2018 (5) TMI 2090
TP Adjustment - adjustment made on international transactions of the assessee with its Associated Enterprises - HELD THAT:- Hon’ble Apex Court has admitted an appeal filed by Revenue in the case of CIT vs. Firestone International P. Ltd [2016 (8) TMI 1285 - SC ORDER] against a judgment of Hon’ble Bombay High Court [2015 (6) TMI 1123 - BOMBAY HIGH COURT] affirming the view taken by the Tribunal that adjustments on arms length transactions had to be restricted to the value of international transactions with Associated Enterprises. However no stay was granted by Hon’ble Apex Court. Hence as on date the judgment of Hon’ble Bombay High Court, is operative
DRP fell in error in giving a direction to do an upward adjustment on aggregate of international transactions of the assessee without restricting it to the proportion of such transactions with its Associated Enterprises. Such directions of the ld. DRP are set aside. Ground No.6 of the assessee stands allowed.
Disallowance of custom duty and revenue loss - economic adjustment for custom duty adjustment and was not pressing for such adjustment on account of revenue loss - HELD THAT:- For making such adjustment, assessee should be able to demonstrate that higher import content was necessitated by some extraordinary circumstances which was beyond its control. Just because there is a difference in proportion of imports between comparables and the assessee would not by itself, in our opinion, warrant any adjustment on profits unless assessee is able to show some extraordinary circumstances which necessitated higher imports when compared to the selected comparables. Assessee in the case before us, has been unable to demonstrate that raw materials purchased after payment of custom duty was of a similar nature as purchased by the comparable entities and there was a substantial difference in custom duties and excise duties on such material. Thus, in our opinion, assessee was rightly denied the adjustment sought by it for custom duty on raw materials. Grounds Of the assessee stand dismissed.
Carry forward losses from earlier assessment years being not allowed a set off while computing the income for the impugned assessment year - HELD THAT:- If the assessee had claimed set off of any brought forward loss from earlier years, which were determined in the regular assessment for such assessment years, then set off could be allowed. We direct the ld. Assessing Officer to look into this issue and provide, if required, appropriate relief to the assessee. Ground allowed for statistical purpose.
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2018 (5) TMI 2089
Income taxable in India - attribution of income as effectively connected with the P.E. of the assessee in India - whether the balance receipts not attributable to permanent establishment of the assessee can be taxed as fees for technical services under Article-13 of the India-UK Tax Treaty? - HELD THAT:- As issue raised in the present appeal is identical to the issues in assessee's own case for A.Y. 2010-11 [2016 (11) TMI 65 - ITAT DELHI] and for similar reasons dismiss the appeal of the assessee as held the receipts from the services rendered outside India are chargeable to tax as Fees for Technical Services in terms of Article 13(4) (c) as it makes available the technology to the recipient of services and further the provisions of article 13(6) of the lndo UK Double Taxation Avoidance Agreement does not apply to this sum, as it does not 'arise through' and also not 'effectively connected' with the permanent establishment of the appellant. - Thus the appeal of the assessee is dismissed.
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2018 (5) TMI 2088
Attachment of petitioner's bank accounts - time limitation - period of limitation for challenging such order is over - HELD THAT:- The issue arising in the present assessment is a repetitive one. In the earlier years, such questions having been decided against the assessee, appeals were filed. Pending such appeals, stay was granted on condition of predeposit of 15% to 20% of the tax demand.
The petitioner shall deposit 15% of the principal tax demand of CST as well as State VAT latest by 25.05.2018 - Upon such deposit, the petitioner's appeal will be entertained on merits treating the requirement of predeposit having been satisfied. Pending such appeal, there shall be stay against further recovery arising out of the order of assessment challenged in the appeal.
Petition disposed off.
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2018 (5) TMI 2087
Disallowance of 1/5th of the electricity and water charges - expenses disallowed for common use of the premises - HELD THAT:- It can hardly be said that the electricity and water charge incurred by the assessee were for non-business purpose, as the employees of the said firm were stated to have used the premises L-41 only while carrying out the professional work of the assessee - Authorities below have wrongly observed that the electric and water expenses are also attributable to this concern - it is worthwhile to note that additions on the identical issue were made in the preceding assessment years 2008-09 and 2009-10, where the CIT(A) has decided the issue in favour of the assessee in the identical facts and circumstances of the case. There is no material before us to show that those orders of the ld. CIT(A) were either reversed or set aside by any of the higher forum. There is also no material on record to establish that there is any change in the fact situation of the instant case. We, therefore, find no justification to deviate from the findings of the Revenue authorities reached in the preceding years and not to follow the rule of consistency during the year under consideration.
Disallowance being 50% of the rent paid by the assessee for its branch office at Greater Kailash, New Delhi - AO restricted the claim of rent simply on the ground that the said premises was being used by two persons, i.e., assessee and M/s. Bhakru & Associates, the proprietor of which Ms. Pallavi Joshi Bhakhru is the partner in assessee firm - HELD THAT:- Simply because Mrs. Pallavi Joshi was the partner in the assessee firm, no adverse inference can be drawn that both the assessee and Bhakhru Assocites were using common space for their business or profession. This fact of internal relationship, in our opinion, would not go to belie the contention of the assessee that the assessee has paid rent for the space used by him to operate its branch office to Smt. Pallavi Joshi Bhakhru, Prop. M/s. Bhakhru & Associates, as Pallavi Joshi was the owner of the said premises. There is not even an iota of evidence to justify that the assessee has claimed any rent for the space used by Bhakhru & Associates for its registered office in the same premises or had paid rent for the space over and obove the space used by it for its branch office. No spot enquiry, giving negative results, appears to have been brought to our notice to belie the contentions of the assessee. We, therefore, do not find any justification to disallow the proportionate expenditure claimed on rent paid by the assessee without bringing any cogent material on record to establish that the assessee has claimed rent payment for the space over and above the space used by it.
Addition being the amount of stale cheques - As per assessee cheque issued during the year but were not presented for payment and the same were reversed since their validity got expired and therefore shown as current liability and the disallowance so made should be deleted- HELD THAT:- As clear from the orders of the lower authorities that stale cheques could not be encashed within the validity period. Therefore, the stale cheque account has been debited and the relevant expenditure has been credited and shown as current liability at the year end. During the year under consideration, there is no effect in the profit & loss account and the assessee has again issued fresh cheque which has been encashed in the succeeding assessment year 2012-13. The assessee is maintaining cash system of accounting. Therefore, in the impugned year, no benefit of expenditure has been enjoyed by the assessee. AO directed that the benefit should be given to the assessee after due verification from the record of the assessee as to when the current liability has been discharged.
Disallowance of 1/6th of the depreciation on cars - HELD THAT:- If the asset is not used wholly for the purpose of business, but partly, then the Assessing Officer is empowered to restrict the fair portion of the claim of the assessee. The Assessing Officer has given the reasons for adopting 1/6th of the total depreciation that the assessee himself has disallowed 1/6th of the expenditure of motor cars. The assessee has relied upon the decision of MUKESH K. SHAH VERSUS INCOME-TAX OFFICER [2004 (5) TMI 530 - ITAT MUMBAI] as deleted the disallowance holding that in that particular case, there was no justification in making the above disallowance and further, the provisions of section 38(2) were not considered in that decision, whereas before us, the Assessing Officer and the CIT(A) both have specifically invoked the provisions of section 38(2) of the Act. - Decided against assessee.
Disallowance of 1/6th interest on vehicle loans - HELD THAT: We find that the assessee has himself disallowed 1/6th of vehicle running, repairing and maintenance expenses, which admittedly suggest that partial use of the vehicles was made for personal purpose and not wholly for the purpose of business. Therefore, in view of our finding on disallowance of 1/6th of the depreciation on vehicles, noted above, we find that the ld. Authorities below have rightly disallowed 1/6th of the assessee’s claim of interest on vehicle loans. Accordingly, this ground also deserves to be dismissed.
Disallowance of 1/10 of the business development expenses - HELD THAT:- AO has disallowed this expense only on adhoc basis without pointing out any expenditure of disallowable nature or personal in nature. From the submissions of the assessee before the lower authorities, it is clear that photocopies of some of the vouchers were produced before the lower authorities. No personal expenses have been pointed out by the Assessee.
Disallowance of interest u/s. 40(b) paid to Mr. Vinod Chandiok - HELD THAT:- AO appears to have wrongly calculated. The contention of the assessee that there is no loss to revenue because the partner has shown this amount as his income and both the partner and the partnership firm are assessable in the same bracket of 30%, is not acceptable for the reason that the intention of the IT Act is to collect tax from the right person as per law. AO also appears to have wrongly interpreted clause (5) of the partnership deed stating that first party was not authorized to receive interest. In presence of these facts, we restore this issue to the file of the Assessing Officer to calculate the interest payable to partner as per provisions of section 40(b)(iv) of the IT Act. Accordingly, this ground is allowed for statistical purposes.
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2018 (5) TMI 2086
TDS u/s 195 - tax withholding liability - vicarious liability - payments made to non-residents - non deduction of taxes at source on payments for commission of sales exports arid legal and professional charges - income as accrued in-India - HELD THAT:- As in case of Farida Leather Company [2016 (2) TMI 798 - MADRAS HIGH COURT] wherein it was held that Merely because a person has not deducted tax at source or a remittance abroad, it cannot be inferred that the person making the remittance, has committed a default in discharging his tax withholding obligations because such obligations come into existence only when the recipient has a tax liability in India. The tax withholding liability of the payer is inherently a vicarious liability on behalf of the recipient and therefore, when the recipient / foreign agent do not have the primary liability to be taxed in respect of income embedded in the receipt, the vicarious liability of the payer to deduct tax does not arise.
This vicarious tax withholding liability cannot be invoked, unless primary tax liability of the recipient / foreign agent is established. In this case, the primary tax liability of the foreign agent is not established. Therefore, the vicarious liability on the part of the assessee to deduct the tax at source does not exist.
In the instant case, it is seen, admittedly that the nonresident agents were only procuring orders abroad and following up payments with buyers. No other services were rendered other than the above. Sourcing orders abroad, for which payments have been made directly to the non-residents abroad, does not involve any technical knowledge or assistance in technical operations or other support in respect of any other technical matters. It also does not require any contribution of technical knowledge, experience, expertise, skill or technical know-how of the processes involved or consists in the development and transfer of a technical plan or design. The parties merely source the prospective buyers for effecting sales by the assessee.
When the transaction does not attract the provisions of Section 9 of the Act, the Revenue has no case and the appeal is liable to be dismissed - Decided in favour of assessee.
Commission on sales has been paid to one M/s Excel Enterprises, Ludhiana are operating from India. Hence, the addition made by the Assessing Officer under section 40(a)(ia) to that extent stands confirmed.
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2018 (5) TMI 2085
Reopening of assessment u/s 147 - Bogus purchases - HELD THAT:- Validity of reassessment proceedings as raised by the assessee is concerned, we find no merit in the same since the return was processed u/s 143(1) and the new tangible material came into the possession of Ld. AO in the shape of information from concerned authorities which pointed at escapement of income and therefore, the jurisdiction was validly assumed by Ld. AO.
Quantum of additions - There could be no sale without purchase /consumption of material since the assessee was engaged as manufacturer of sheet metal components. The sales turnover achieved by the assessee has not been disputed by the revenue and the payments were through banking channels. The assessee was in possession of primary purchases documents.
At the same time, the assessee could not conclusively substantiate the purchases made by him and failed to produce any of the party to confirm the transactions. All these factors cast a serious doubt on assessee’s claim. Therefore, in such a situation, the addition, which could be made, was to account for profit element embedded in these purchase transactions to factorize for profit earned by assessee against possible purchase of material in the grey market and undue benefit of VAT against such bogus purchases, which Ld. CIT(A) has rightly done - we dismiss the assessee’s appeal.
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2018 (5) TMI 2084
TP Adjustment - comparable selection - Design & Engineering Services Segment - characterize the assessee as providing ITES - AR contended that the characterization of the assessee's services rendered to its AEs in this segment as "ITES" was wrong and the same should have been characterized as "Design and Engineering Services" - HELD THAT:- As it was not correct to characterize the assessee as providing ITES. First of all, the TPO does not appear to be following a consistent position over the years - in Assessment Year 2011-12, Revenue has also accepted the services rendered by this segment as 'Engineering & Design Services' - also characterization is not in tune with the functional analysis done in the TP Study as the TPO has not brought on record any evidence which might establish that the characterization has to be ITES only - for unclear/unestablished factual position as emerges we deem it appropriate to remand the matter back to the file of the TPO and direct that the characterization of the assessee shall be done in accordance with law, after affording the assessee adequate opportunity of being heard and to make submissions and file details etc required which shall be duly considered.
Computation of deduction under Section 10A - seeking parity between export turnover and total turnover - exclusion of expenses incurred on freight and travel in foreign currency from both export turnover as well as the total turnover - HELD THAT:- This issue is no longer res integra and is covered by the judgment in the case of Tata Elxsi Ltd. [2011 (8) TMI 782 - KARNATAKA HIGH COURT] wherein it has been held that if certain expenses are excluded from export turnover, the same should be excluded from total turnover. Thus we reverse the decision of the learned CIT (Appeals) and direct the Assessing Officer to compute the deduction under Section 10A of the Act by reducing the said expenses from both export turnover and total turnover.
Charging of interest under Section 234B & 234D - HELD THAT:- The charging of interest is consequential and mandatory and the Assessing Officer has no discretion in the matter. This proposition has been upheld by the Hon'ble Apex Court in the case of Anjum H. Ghaswala 2001 (10) TMI 4 - SUPREME COURT]and we therefore uphold the action of the Assessing Officer in charging the said interest in the case on hand. The Assessing Officer is, however, directed to recompute the interest chargeable under Section 234B & 234D.
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2018 (5) TMI 2083
Revision u/s 263 - revision initiated agaist orders infructuous/non-est in the eyes of law - HELD THAT:- In the instant case, there is no ambiguity that the order passed by Ld. CIT u/s 263 of the Act in the case of assessee pertaining to assessment year 2009-10 was quashed [2016 (4) TMI 122 - ITAT AHMEDABAD] - there remains no doubt that the order passed by Ld. CIT u/s 263 of the Act was held as unsustainable. Therefore, the order passed in consequent to the direction issued u/s 263 of the Act becomes infructuous. Hence, we find no reason to interfere in the order passed by the ld. CIT(A) on the ground that the consequential order passed u/s 143(3)/263 of the Act is not maintainable and thus the appeal filed becomes infructuous - Decided against revenue.
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2018 (5) TMI 2082
Oppression and Mismanagement - Seeking urgent staying of the extraordinary general meeting to remove the petitioners from their position of directors - seeking that resolutions to remove them as directors should not be given effect to - sections 241 to 242 of the Companies Act, 2013 - HELD THAT:- The National Company Law Tribunal has at this initial stage of the litigation, exercised its powers which appear to be striking fair balance between the two groups. Learned counsel for the respondents (the original petitioners) in appeal have pointed out as to how the appellants are even acting upon these directions of the learned National Company Law Tribunal to proceed with the affairs of the company.
The learned National Company Law Tribunal has exercised discretion judicially when ad interim order was sought from it to protect the interest of the company till the petition is decided.
It is true that the National Company Law Tribunal accepted what the Deputy Registrar appeared in the court and said that at 11.00 p.m. on February 23, 2018 the interim orders and operative part of the order had been communicated to counsel for the petitioner. But then, there is material showing that even on February 24, 2018 by two e-mails, counsel for the original petitioners kept requesting the original respondents to postpone the extraordinary general meeting as the orders were yet not in their hands and that the matter was sub judice. At the time of arguments, we asked learned counsel for the appellants (original respondents) as to what would be the benefit to the original petitioners not to inform the stay to the extraordinary general meeting (which they were clamoring for) if they had really come to know about it. There was no clear answer from the learned counsel.
Appeal dismissed.
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2018 (5) TMI 2081
Disallowance u/s.40(a)(ia) - payment of ‘Bank Guarantee Charges’ on the ground that tax at source has not been deducted by making such payment to the schedule bank - Retrospectivity of the second proviso to Section 40(a) (ia) - to remove the rigours of deduction of TDS on the various kinds of payment to Scheduled banks, CBDT had issued a notification no. 56/2012 dated 31.12.2012 - HELD THAT:- Hon'ble Delhi High Court in the case of CIT vs. Ansal Land Mark Township (P) Ltd. [2015 (9) TMI 79 - DELHI HIGH COURT] in the context of second proviso to Section 40(a)(ia) has held that if the newly inserted provision has been introduced to remove the hardship, then it is in the nature of declaratory and curative, hence same has to be given retrospective effect.
The CBDT circulars clarifying the statutory provisions acts as Contemporanea Expositio while interpreting the said provision in the statute and such an exposition to remove the hardships and rigours has to be reckoned retrospectively. Thus, we hold that such a notification issued by the CBDT is not only curative and declaratory but also shows the intention of the Government that payment of bank guarantee commission etc. to the schedule bank, no TDS provisions should be applicable, and therefore, such notification would apply even prior to 1st day of January, 2013 - assessee has already filed certificates from all the Schedule Banks that the bank guarantee commission received has been offered as income on which due taxes has been paid, therefore, in view of second proviso to Section 40(a)(ia) which has been held to be applicable retrospectively by the Hon’ble Jurisdictional High Court in Ansal Land Mark Township (supra), no disallowance u/s.40(a)(ia) can be made.
Addition of expenditure paid to various organisation towards sales promotion and advertisement, holding it to be expenses in the nature of Corporate Social Responsibility - HELD THAT:- The assessee being a public sector undertaking and is governed by Ministry of Urban and Development and is also guided by the Office Memorandum issued by the Department of Public Enterprises. The expenditure incurred in pursuance of any guidelines or office memorandum, however has to be seen from the perspective of, whether there was any commercial expediency in making such payment or not; and if the payment is to be made to any other department or organization for advertisement or sales promotion, then whether assessee’s name and publicity in such advertisement is appearing or not needs to be verified. Accordingly, we restore this matter to the file of the Assessing Officer to see whether for incurring such an expenditure given to various departments or organization for advertisement and sales promotion purpose or publicity, the name of Assessee Corporation is appearing in such advertisement and publicity/ or is for commercial expediency. With these directions, we restore this issue to the file of the Assessing Officer for fresh adjudication. Thus, the grounds raised by the assessee are partly allowed for statistical purposes.
Disallowance u/s 14A r.w.r.8D - HELD THAT:- We find that AO has made disallowance under Rule 8D (2)(ii) of interest which ostensibly could not have been made for the reason that assessee has not taken any secured or unsecured loan for making any investment and; secondly, the interest expenditure debited is on account of delayed payment made to the contractors. Thus, there could not have been any question of disallowance of interest under Rule 8D (2)(ii).
Indirect expenditure - To invoke Rule 8D, it is sine qua non that Assessing Officer must record his satisfaction having regard to the nature of expenditure debited in accounts maintained so as to see whether any expenditure has been incurred which could be said to be attributable for earning of exempt expenditure. AO here has not applied his mind which is evident from the fact that he has even proceeded to disallow interest expenditure when there is no secured or unsecured loan or borrowed funds in the balance sheet. Further, how the joint venture investment made in the JVs is capable of earning exempt income has not been examined AO - Recording of such satisfaction upon the claim made by the assessee is mandatory as held by Jurisdictional High Court in the case of H.T. Media Ltd. vs. Pr. CIT. [2017 (8) TMI 962 - DELHI HIGH COURT] and failure on part of the AO to comply with section 14(2) read with Rule 8D(1)(a), disallowance cannot be made. Thus, we hold that in absence of mandatory requirement of Section 14A (2), AO could not have applied Rule 8D, and therefore, disallowance made by the Assessing Officer cannot be sustained. Hence, ground no.1 raised by the Revenue is dismissed.
Addition u/s 80IA - HELD THAT:- We find that ld. CIT (A) has mainly directed the Assessing Officer to verify the condition specified in Section 80IA and allow the same to the assessee. Even if such a claim has been made by the assessee at the appellate stage, then ld. CIT (A) is well within his jurisdiction and power to entertain such a plea and decide in accordance with law. Hon'ble Supreme Court in the case of Goetze (India) Ltd. [2006 (3) TMI 75 - SUPREME COURT]as referred in the grounds of appeal by the Revenue itself lays down that such a power to entertainment the claim does not impinge upon the ld. CIT(A). Thus, we do not find any infirmity in such a direction by the ld. CIT (A) and same is affirmed. Accordingly, the ground raised by the Revenue is dismissed.
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2018 (5) TMI 2080
Levy of Service Tax - services provided by the Municipality - Executive Officer of the Town Panchayat / appellant has accepted to pay the tax - belated filing of appeal - no provisions for condonation of delay - rejection of appeal on the ground of estoppel - HELD THAT:- The rejection of the claim of the appellant on the ground of estoppel cannot be sustained. There cannot be any estoppel against statute and if it is found that some of the services, on which service tax is sought to be levied, are actually exempted from the purview of the service tax. The concession or an admission of liability by the officials cannot be a ground to reject the challenge to the very levy of the service tax.
The Commissioner [Appeals] is directed to pass orders on the appeals filed by the appellant/Panchayat - appeal allowed.
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2018 (5) TMI 2079
Addition u/s 68 on account of unexplained cash credits - HELD THAT:- It is pertinent to note that the documents which were produced before the Assessing Officer as well as the CIT(A) has not at all been considered by both the Revenue authorities. Therefore, it will be appropriate to remand this matter for fresh to the file of the AO. Needless to say, the assessee be given opportunity of hearing by following principle of natural justice.
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2018 (5) TMI 2078
Seeking direction to respondents to redeem the fully paid up secured redeemable non-convertible debenture in favour of applicants/ petitioners - Section 73(4) & Section 71(10) of the Companies Act, 2013 - HELD THAT:- By the perusal of the record, it is undisputed that all the applicants fall within the category of either debenture holder or deposit holder - Section 71(10) and 73(4) of the Companies Act, 2013 deals with the power of this tribunal, when a company fails to redeem the debenture or fails to repay its deposits.
In the present application copies of the certificates available to debenture holders are annexed as annexure 2 of the present application, but no copy of surrender is annexed - Further notices by the applicants for non-payment of debenture stating the details of debenture Certificate no, Registered Folio no, numbers of Debentures, Distinctive No(s) of Debentures, Date of Allotment sent to Respondent No.1.
Present Applicant 1 to 32 falls into the category of debenture holder. They have complied all the requirement of Form 11 of National Company Law Tribunal Rules, 2016 and annexed all the documents to prove that the R1 company failed to redeem their debenture on the date of maturity/repay the deposit on the date of maturity. Hence, the present petition is allowed regarding its prayer clause and company above named is directed to make repayment of the Deposit above (s)/ Debenture (s) along with interest due thereon by the Terms and Conditions of the Deposit/ Debenture within 15 days from receipt of this order - it is found that maturity date of the Debenture Certificate of the some of the debenture holder is premature. Hence such debenture/ premature certificate are devoid of this order.
Application disposed off.
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2018 (5) TMI 2077
Income accrued in India - services rendered in relation to health care - determination of nature of fees and its taxability received Royalty or Fees for Included Services(FIS) or Business Profits - Taxing 90% of the total receipts as Royalties as per Article 12(3) of DTAA and taxing the remaining 10% of the receipts as Fees for Included Services under the Article 12(4)(b) of the DTAA - HELD THAT:- As decided in own case[2011 (11) TMI 484 - ITAT MUMBAI] payments received from Max does not constitute FIS (Fee for Included Services) within the meaning of Article 12(4), as nothing is made available by the Assessee to Max and also the Assessee does not have any P.E in India. Therefore the income so arising to the Assessee in India cannot be taxed under Article 7 as 'Business Profits". Appeal filed by the AO stands dismissed.
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2018 (5) TMI 2076
Disallowance u/s 32 - goodwill shown by the assessee in its books was an unreal and artificially inflated one - HELD THAT:- Assessee had worked out the share swap ratio considering net worth of the rental division of M/s. Mtandt Ltd transferred to it and divided such net worth with value of its own share as on 31.12.2011. The valuation of the rental division was supported by a certificate issued by a competent Chartered Accountant and Revenue has not placed anything on record to prove that the valuation was unfair or incorrectly done.
In our opinion goodwill which came into the books of the assessee on account of rounding off of the decimal in share swap ratio was not an artificial one. Issue of equity shares by the assessee to M/s. Mtandt Ltd was not artificial but real. Even in the case of Smifs Securities Ltd [2012 (8) TMI 713 - SUPREME COURT] considered goodwill was result of an scheme of amalgamation which is not much different from a scheme of demerger. In the circumstances, we are of the opinion that the lower authorities fell in error in disallowing the claim of depreciation. Orders of the lower authorities are set aside. Depreciation claimed by the assessee stands allowed.
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2018 (5) TMI 2075
Assessment u/s 153C - search and seizure operation u/s 132 - HELD THAT:- We find the Hon’ble Delhi High Court in the case of RRJ Securities Ltd. [2015 (11) TMI 19 - DELHI HIGH COURT] has held that the proviso to section 153C(1) expressly indicate that reference to the date of initiation of search for the purpose of second proviso to section 153A, shall be construed as a reference to the date on which valuable assets or documents are received by the Assessing Officer of an assessee (other than the search person).
Since in the instant case also the documents were handed over to the Assessing Officer on 03.12.2013 and action u/s 153C was also initiated on 03.12.2013 a finding given by the ld. CIT(A) and not controverted by the ld. DR, therefore, the six preceding assessment years will be from A.Y. 2008-09 to 2013-14. Since in the instant case, the Assessing Officer has issued notice u/s 153C to the assessee for assessment year 2006-07, therefore, the same being beyond the period of six preceding assessment years from the reference date is void ab-initio.
The assessment completed u/s 153C/153A for the impugned assessment year is void ab-initio since the Assessing Officer has no jurisdiction for making the assessment for assessment year 2006-07 being beyond the period of six years. Since the order of the ld. CIT(A) is in accordance with law laid down by the Hon’ble Jurisdictional High Court in RRJ SECURITIES LTD. AND VICA-VERSA [2015 (11) TMI 19 - DELHI HIGH COURT] therefore, in absence of any contrary material brought to our notice, we do not find any infirmity in the order of the ld. CIT(A) holding the assessment as void ab-initio. Accordingly, the order of ld. CIT(A) is upheld and the grounds raised by the Revenue are dismissed.
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2018 (5) TMI 2074
Condonation of delay - appeals filed before the CIT(A) were time barred by 1099 days and 906 days - HELD THAT:- no doubt there is some negligence at the end of the assessee for conducting his income tax proceedings. There is no material before us to ascertain whether the assessee has appeared before the AO on 14.11.2014. Similarly, there is nothing to doubt that the assessment order might have not been served upon father of the assessee. Original acknowledge receipt has not been placed on the record. However, considering the case of an individual upon whom tax liability of ₹ 22,72,460/- has been fastened by virtue of an ex parte order which has been further compounded by imposition of penalty of ₹ 7,40,871/- we are of the view that punishment in the shape of tax liability is far disproportionate with the alleged negligence. The possibility of illness of his father could not be ruled out. His house was attached and he has to approach Hon’ble High Court by way of writ petition
Making appeals time barred the assessee would not achieve anything. The tax liability would be confirmed and it could be recovered. Therefore, it cannot be alleged that the assessee has adopted this modus operandi as a strategy. It might be a bona fide negligence.
We condone the delay in filing the appeal before the ld.CIT(A) and remit the issues to the file of the ld.CIT(A) for fresh adjudication. Considering the alleged negligence in conducting the proceedings before the ld.Revenue authorities below, we impose a cost of ₹ 2,500/- upon the assessee on each appeal.
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2018 (5) TMI 2073
Bogus LTCG - Addition u/s 68 - sale proceeds of shares of Sulabh Engineering and Services Ltd. treated as income from undisclosed sources - HELD THAT:- Scrips / equity shares of M/s Sulabh Engineering and Services Ltd. has been dealt with by the SMC Bench of this Tribunal in the case of Vasudha Jain [2019 (2) TMI 1136 - ITAT KOLKATA] wherein the SMC Bench of this Tribunal held that addition has been made by AO mainly on the basis of ‘suspicion’ and ‘probability’. No price rigging established by AO - AO as well as ld CIT(A), were guided by the report of the Investigation Wing, which is general in nature and no specific findings for the assessee, and hence based on these facts the SMC Bench deleted the addition - Decided in favour of assessee.
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2018 (5) TMI 2072
Levy of Service Tax - certain expenses like Samples/Promotional dispatch, IS Chargers etc. - Clearing and Forwarding Services - demand of duty along with interest and penalty - HELD THAT:- A series of correspondences were made with the appellant asking for payment of arrear tax arising out of the Order-in-Original dated 12.12.2011 and 13.12.2011 and all the correspondences were duly received by the appellant, as none of the correspondences were returned by the postal authorities as undelivered. This fact has not been refuted by the appellant in their appeal. It appears that the appellant had knowledge of the passing of the impugned Adjudication Order.
There are no reason to interfere with the order of the Commissioner (Appeals) - appeal dismissed - decided against appellant.
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2018 (5) TMI 2071
Computation of interest on post dated cheques - computation from the date after the six months of issue of such post dated cheques i.e. from the date cheques i.e. from the date of execution of sale-deed - HELD THAT:- On the issue of interest the issue is squarely covered in favour of the assessee in one of the group cases in case of M/s IAG promoters and developers private limited [2014 (12) TMI 216 - ITAT DELHI] wherein held that the ground raised by the revenue is misconceived because Ld. CIT (A) is not deleted the addition but has only directed to recalculate the interest. We have carefully gone through the order of the Ld. CIT (A) and the submissions of both the parties and we do not find any infirmity in the order of the Ld. CIT (A). After examining the loose papers seized at the time of search and the assessee’s premises, it was noted that the interest is paid on the post dated cheques only during the period of extension of post dated cheques and therefore he directed the assessing officer to recompute the interest on post dated cheques at the time of extension of the post dated cheques -CIT (A) directed to recalculate the interest on post dated cheques and was a sound logic for such direction. His direction is based on material found and seized at the time of search. In view of the above we do not find any justification to interfere with the order of the Ld. CIT (A) - Decided against revenue.
Additional payment made to the owners of the land is allowable as an expenses u/s 37 - disallowance of expenditure being amount paid to the various landowners over and above the actual price of the land - HELD THAT:-This issue is squarely covered in favour of the assessee by the decision of M/s westland developers private limited [2014 (12) TMI 254 - ITAT DELHI] for the assessment year 2006 – 07 is in that case such addition was deleted. DR could not controvert the above fact and further more that decision of the coordinate bench is further followed in several decisions by the coordinate bench wherein the similar issue was involved in the case of the group concerns. In view of this the above judicial precedent binds us and therefore respectfully following the decision of the coordinate bench we also direct the Ld. assessing officer to delete the addition made in the hands of the assessee. Consequently, we confirm the order of the Ld. CIT (A) and dismiss ground No. 2 of the appeal of the revenue.
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