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2019 (6) TMI 1623 - AUTHORITY FOR ADVANCE RULINGS — NCR BENCH(INCOME-TAX)
Advance ruling application - Income taxability in India - taxability of payments to be made by Perfetti India for the costs to be allocated by the applicant under the service agreement - DTAA between India and the USA - Applicant had relied on the provisions of article 12(5)(b) of the DTAA to canvass that in the absence of a "make available" condition, the payments would not partake of the character of "fees for technical services" and further in the absence of any permanent establishment (PE) (in terms of article 5 of the DTAA) of the applicant, such payments would not be taxable in India - HELD THAT:- As services rendered under the service agreement when read with TTKLA, fall within the purview of article 12(5)(a) of the DTAC as such services "are ancillary and subsidiary to the application or enjoyment of the right, property or information for which a payment described in paragraph 4 of this article is received" by the applicant.
Whether the services also "make available" technical knowledge, experience, skill, know-how or processes or consist of the development and transfer of a technical plan or technical design, which enables the persons acquiring services to apply the technology contained therein? - The exercise to segregate the services which "make available" the technical knowledge, experience, skill, know-how, processes etc. and enable the recipient to apply the same without reference to the service provider and the advisory services which fail to fulfil this yardstick, will only be an academic exercise. As already mentioned earlier the service charge received by the applicant is taxable under article 12(5)(a) of the DTAC between India and the Netherlands and it is not necessary that the clause of article 12(5)(b) should also be simultaneously satisfied. The exercise to identify the services which satisfy the 'make available' clause would have been relevant, if the article 12(5)(a) would not have been found to be applicable.
The questions posed to us for a ruling are answered as under :
Question No. 1 : The payment to be made by Perfetti India for the cost to be allocated by the applicant is taxable under article 12(5)(a) of the DTAC between India and the Netherlands. Though some of the services are also taxable article 12(5)(b) of the DTAC, such services are not segregated as they are already taxable under article 12(5)(a).
Question No. 2 : As the answer to question No.1 is in affirmative, the payment made by Perfetti India would be chargeable to tax in India.
Question No. 3 : Perfetti India is liable to withhold taxes under section 195 of the Act on the payments to be made towards the costs to be allocated by the applicant.
Question No. 4 : As the applicant is liable to tax in India, it is required to file a tax return under the provisions of the Act and the transfer pricing provisions of sections 92 to 92F would be applicable in respect of the payment to be made by Perfetti India.
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2019 (6) TMI 1622 - ITAT MUMBAI
TP Adjustment - comparable selection - Motilal Oswal Private Equity Advisors Pvt. Ltd - HELD THAT:- As relying on NEW SILK ROUTE ADVISORS PVT. LTD [2018 (11) TMI 1769 - ITAT MUMBAI], TEMASEK HOLDINGS ADVISORS INDIA (P.) LTD. [2017 (8) TMI 1490 - ITAT MUMBAI], WELLS FARGO REAL ESTATE ADVISORS PVT. LTD. [2018 (1) TMI 931 - ITAT MUMBAI], AVENUE ASIA ADVISORS PVT. LIMITED [2017 (9) TMI 1295 - DELHI HIGH COURT] therein conclude that Motilal Oswal Equity Advisors Pvt. ltd. cannot be treated as a comparable to the assessee.
Ladder up Corporate Advisors Pvt. Ltd: cannot be treated as a comparable to the assessee. See M/S. GUGGENHEIM CAPITAL MANAGEMENT (ASIA) PRIVATE LIMITED [2019 (2) TMI 1817 - ITAT MUMBAI], TATA ASSET MANAGEMENT LTD. VERSUS DY. COMMISSIONER OF INCOME TAX CIRCLE–2 (3) ) (1) , MUMBAI [2019 (3) TMI 1883 - ITAT MUMBAI] and BLACKSTONE ADVISORS INDIA PVT. LTD. AND VICE-VERSA [2018 (11) TMI 1732 - ITAT MUMBAI]
Cyber Media Research Ltd. (formerly IDC India Ltd.) was engaged in rendering market research and management consultancy services, and was also a premier provider of market intelligence and advisory services, therefore, it was functionally comparable to investment advisory providers. See NEW SILK ROUTE ADVISORS PVT. LTD. VERSUS ASSTT. COMMISSIONER OF INCOME TAX CIRCLE–7 (2) (2) , MUMBAI AND VICE-VERSA [2018 (11) TMI 1769 - ITAT MUMBAI]
Thus we direct the A.O to exclude the two comparables which were selected by the TPO viz. (i) Motilal Oswal Pvt. Equity Advisors Pvt. Ltd; and (ii) Ladder up Corporate Advisors Pvt. Ltd. from the final list of the comparables. At the same time, the A.O is directed to include Cyber Media Research Ltd. (formerly IDC India Ltd.) in the final list of comparables.
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2019 (6) TMI 1621 - ITAT MUMBAI
Disallowance u/s 14A - HELD THAT:- It is not in dispute that during the year under consideration, the assessee was not having any exempt income, therefore, in view of the decision of CHEMINVEST LIMITED VERSUS COMMISSIONER OF INCOME TAX-VI [2015 (9) TMI 238 - DELHI HIGH COURT] CIT(A), no disallowance is warranted. Accordingly, we upheld the action of CIT(A) for deleting the disallowance made u/s.14A.
Expenditure incurred on gift / diwali puja expenses etc disallowed- HELD THAT:- This issue has also been decided by this Tribunal in assessee’s own case, which has been followed by CIT(A). Respectfully following the order of the Tribunal in assessee’s own case for A.Y.2006-07[2012 (11) TMI 1245 - ITAT MUMBAI] we do not find any infirmity in the order of CIT(A) for confirming the disallowance, in both the years under consideration.
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2019 (6) TMI 1620 - ITAT MUMBAI
Income accrued in India - subscription fees received by the assessee in India is neither in the nature of fees for technical services nor royalty, as defined under section 9(1)(vi) and 9(1)(vii) of the Act and also under India Germany - HELD THAT:- In this view of the matter and consistent with view taken by the Co-ordinate Bench [2019 (5) TMI 405 - ITAT MUMBAI], we are of the considered view that subscription fees received by the assessee from customers in India for allowing them to access online database created by the assessee in the name of ‘Reaxys’ and ‘EMBASE’ cannot be considered as fees for technical services or royalty within the meaning of section 9(1)(vi) and 9(1)(vii) of the Act, nor under India Germany Tax Treaty. Therefore, by respectfully following the decision of the co-ordinate bench of the Tribunal in assessee’s own case, we direct the AO to delete the additions made towards income computed @10% of total subscription fees as per India Germany Tax Treaty. - Decided in favour of assessee.
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2019 (6) TMI 1619 - GUJARAT HIGH COURT
Dishonor of Cheque - petitioner was a Nominee Director of the Company at the time of offence or not - cheque given as security or otherwise? - HELD THAT:- In the instant case not only completely self-contradictory stand has been taken, no offence had been made out which discloses the offence under section 420 of the Indian Penal Code. Learned Magistrate had taken cognizance off offence under sections 406, 419, 420 read with section 120B of the Indian Penal Code - Here this Court is considering the existing liability of section 138 of the N.I. Act. The petitioner though does not dispute that liability, it has spoken of a litigant, which has travelled civil litigation, which is pending and also litigation which has travelled to NCLT.
Even while accepting that the cheques, which are accepted and said to have been dishonored, and endorsement on the back side of the same being given towards the security with no dispute with regard to non-payment of electricity charges for all the three months being July, 2016 to September, 2016 and the dispute with regard to respondent complainant not having obtained captive power plant status and the letter of credit having been furnished by the company and where the same was, according to the required format of the bankers of respondent or where there was any other difficulty in getting the same negotiated are some of the questions, which are being disputed questions of facts and also being essentially the defence of the petitioner, shall need to go before the trial Court for it to adjudicate in accordance with law.
In such circumstances to prevent the abuse of process of law, the Court can step in and indulge. However, where the complaint filed is genuine, the High Court as per this decision is not to travel beyond the prescribed limit and sometimes on the very same set of facts, civil and criminal both proceedings are maintainable.
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2019 (6) TMI 1618 - CESTAT KOLKATA
Levy of penalty - payment of tax and penalty on being pointed out - renting of immovable property service - no suppression of facts - HELD THAT:- The issue involved in this appeal is no more res-integra in view of the decision of the Tribunal in the case of R.K. REFRESHMENT & ENTERPRISES (P) LTD. Versus COMMR. OF C. EX., RAIPUR [2018 (2) TMI 1412 - CESTAT NEW DELHI] where it was held that though the said sub-section was basically with reference to renting of immovable property service, the main Section 80 is still available to the appellant considering that the tax liability under renting of immovable service was subject matter of various disputes, amendments, including retrospective amendment. As such, the penalty imposed on this service is waived invoking provisions of Section 80.
The penalty imposed in the impugned order is set aside - Appeal allowed - decided in favor of appellant.
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2019 (6) TMI 1617 - CESTAT KOLKATA
CENVAT Credit - input services - commission paid to its agents situated in and outside India and appointed for the sale and marketing of their goods - reverse charge mechanism - HELD THAT:- The issue stands already settled and decided in favour of the Respondent assessee. It is also seen that the First Appellate Authority has extended the benefit on the basis of the decision of the Tribunal in the case of M/S ESSAR STEEL INDIA LTD. VERSUS COMMISSIONER OF C. EX. & SERVICE TAX, SURAT-I [2016 (4) TMI 232 - CESTAT AHMEDABAD] - Further, Tribunal in the case of M/S. STANLEY SEATING VERSUS THE COMMISSIONER OF CENTRAL EXCISE, BANGALORE [2017 (1) TMI 972 - CESTAT BANGALORE] where it was held that the commission paid on sales becomes part of sales promotion resulting in increased manufacturing activity.
Credit allowed - appeal allowed - decided in favor of appellant.
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2019 (6) TMI 1616 - CESTAT KOLKATA
CENVAT Credit - manufacture of dutiable as well as exempt goods - scope of 'exempted goods' - reversal of credit in terms of Rule 6 of the Credit Rules - HELD THAT:- The term ‘excisable goods’ has been defined in Section 2(d) of the Central Excise Act to mean the goods specified in the First Schedule and the Second Schedule to the Central Excise Tariff Act, 1985 as being subject to a duty of excise and includes salt. We find that the subject goods manufactured by the Appellant are not excisable goods - It is noted that in the case of SAHNI STRIPS & WIRES (P) LTD. VERSUS COMMISSIONER OF C. EX., ROHTAK [2012 (12) TMI 469 - CESTAT, NEW DELHI], wherein the dispute pertained to the period from December 2006 to May 2008 for recovery of 10% of the value of exempted goods as alleged by the Revenue.
The credit is not liable to be reversed in view of the provisions as were applicable during the period in dispute. The reversal of credit, if at all, will be applicable for the period post amendment made vide Notification no. 6/2015- C.E.(NT) dated 1st March, 2015 - As per the relevant chapter notes, the goods could not be said to be covered in the schedule to the Central Excise Tariff Act, which is the basic requirement to constitute ‘excisable goods’ as per the definition contained in Section 2(d) of the Act. For something to enjoy exemption under the Cenvat Credit Rules, it should first qualify as ‘excisable goods’ under the said Rules or the Central Excise Act and Central Excise Tariff. Goods that are outside the purview of Central Excise cannot be construed as ‘exempted goods’ for the purpose of this Act. Simply put, something can be exempted only if it was otherwise dutiable under a particular law.
Rule 6 of the Cenvat Credit Rules does not find application in the instant case and hence, the Appellant cannot be saddled with the duty demand - matter is being disposed on merits, limitation issue is not considered - appeal allowed.
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2019 (6) TMI 1615 - CESTAT KOLKATA
Smuggling - Gold - Indian Currency - onus to prove - whether the appellant has satisfactorily discharged his onus under Section 123 of the Customs Act,1962 to the effect that the gold seized from him is not smuggled gold? - Confiscation - penalty - HELD THAT:- The gold was not seized while it was being smuggled either at the Port or at the Airport. It was seized from his shop in the City. In such cases, Section 123 of the Customs Act, 1962, provides in respect of the gold and some other notified goods, if the seizure was under reasonable belief, that they are smuggled, the onus of proving that they are not rests upon the person from whom the goods were seized. The first question is whether there was reasonable belief. In this case, it is found that the seizure was based on the information that they had received and that the documents pertaining to the gold, were not found in shop at the time of seizure. There is nothing on record to suggest that the pieces which were seized had any foreign markings. Under these circumstances, there was no reasonable belief for the seizure.
The appellant had produced various documents to show how he came in the possession of gold and these documents, on investigation, were found to be genuine. It is for this reason that the Ld.Commissioner has refrained from imposing any penalty upon the appellant under Section 114AA of the Customs Act, 1962 - not only was there no reasonable belief for seizure of the gold and the Currency in the first place, but also that the appellant has satisfactorily explained that the gold and currency which were in his possession.
The confiscation of gold and the currency and imposition of penalty upon the appellant under Section 112 of the Customs Act, 1962, are, therefore, not sustainable and the impugned order needs to be set aside - appeal allowed - decided in favor of appellant.
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2019 (6) TMI 1614 - CESTAT KOLKATA
CENVAT Credit - total price of coal tar and coal gas, which comes into existence during the manufacture of coke at the time of their clearance from Tata Steel’s steel plant at Jamshedpur, in terms of Rule 6(3)(b) of the Cenvat Credit Rules - period from June 2003 to August, 2007 - HELD THAT:- The issue involved in the instant case stands settled by the Hon’ble Supreme Court’s decision in UNION OF INDIA & OTHERS VERSUS M/S. HINDUSTAN ZINC LTD. [2014 (5) TMI 253 - SUPREME COURT]. Therein the Supreme Court decided a batch of appeals preferred by the Union of India on the issue. One of the decisions which was affirmed by the Supreme Court in this case was the decision of the Bombay High Court in RALLIS INDIA LTD. VERSUS UNION OF INDIA [2008 (12) TMI 46 - HIGH COURT BOMBAY], which had reversed the decision of the Larger Bench of the Tribunal in RALLIES INDIA LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, SALEM [2006 (12) TMI 162 - CESTAT, MUMBAI], which was relied in issuing the show cause notice.
Thus, it is an undisputed fact that the entire quantity of coal is completely utilized for production of coke and no part thereof forms a part of the coal gas or coal tar, which inevitably comes into existence as a technological necessity. Here also the appellant cannot use lesser quantity of coal only to produce coke and not produce coal gas or coal tar. Hence, it has to be concluded that the appellant has consumed the entire quantity of coal in the production of coke. Further, merely because coal tar is recovered by a recovery process in the coke plant, from the mixtures of the several by products which arise in the course of production of coke from coal, as and by way of technological necessity, the same cannot and does not become a final product.
The provisions of Rule 6(3)(b) of the Cenvat Credit Rules are inapplicable to the instant case and, consequently, the appellant is not required to make payment of any amount contrary to what has been held in the impugned order - appeal allowed - decided in favor of appellant.
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2019 (6) TMI 1613 - CESTAT KOLKATA
CENVAT Credit - valid duty paying documents or not - sale-in-transit - the goods were received in the factory under the cover of duty paying documents issued by second stage dealer, namely, M/s Roshanlal Bhagirathmal and the name of the appellant has been recorded as “consignee” - HELD THAT:- The issue is no more res integra in view of the decision of the Tribunal in the case of Kunststoff Polymers Ltd. Vs. CCEx., Bhopal [2009 (5) TMI 743 - CESTAT, NEW DELHI] where it was held that the Cenvat credit cannot be denied so long as the co-relation between goods received by the user manufacturer from the dealer under the dealer’s invoice can be established with the goods received by the dealer from the manufacturer.
In the present case, there is no dispute that the goods were directly received by the appellant from the second stage dealer, namely, M/s Roshanlal Bhagirathmal and the invoices issued by M/s Roshanlal Bhagirathmal mentioned M/s Ashis Enterprise as the buyers/customers, while at the same time, the name of the appellant is mentioned as “consignee”. These documents cannot be rendered invalid for taking cenvat credit.
Appeal allowed - decided in favor of appellant.
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2019 (6) TMI 1612 - ITAT CHENNAI
Mandatory requirement of law to e-file the appeal - Appeal filled manually - delay of filling 909 days - HELD THAT:- When the appeal was filed by the assessee manually, if it is not in tune with the statutory requirement, it is for the CIT(Appeals) either to issue a defect memo or to return the appeal filed manually, to the assessee. Admittedly, no such action was taken by the CIT(Appeals).
The appeal was e-filed on 11.12.2018. Therefore, this Tribunal is of the considered opinion that when the assessee admittedly filed the appeal manually on 02.05.2016 and also e-filed on 11.12.2018, the assessee’s e-filing of appeal would relate back to the original date of filing appeal manually on 02.05.2016. There is no delay in filing the appeal. If e-filing of appeal on 11.12.2018 relates back to manual filing of appeal on 02.05.2016, there is no delay at all.
CIT(Appeals) ought to have disposed of the appeal on merit. In view of the above, we are unable to uphold the orders of the authorities below. Accordingly, orders of both the authorities below are set aside and the entire issue is remitted back to the file of the CIT(Appeals). CIT(Appeals) shall consider the appeal on merit and dispose the same in accordance with law, after giving a reasonable opportunity to the assessee. Appeal filed by the assessee is allowed.
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2019 (6) TMI 1611 - ITAT CHENNAI
Bogus LTCG claim - exemption u/s.10(38) denied - HELD THAT:- Perusal of the assessment order clearly shows that AO has only made allegation in respect of the company and the modus operandi of the bogus claim u/s.10(38) of the Act. The evidences clearly show that the transactions of purchase and sale of the shares by the assessee herein are through BSE by paying STT. This is not a case for offline purchase, nor is the case of direct purchase.
Neither is the assessee’s name coming out in the Investigation report, which has been received by the AO from Directorate of Investigation, Kolkata. This being so, the claim of assessee cannot be disallowed merely on presumptions and the AO is directed to grant the assessee benefit of exemption u/s.10(38) of the Act as claimed in respect of long term capital gains generated by purchase and sale of shares of M/s.Sulabh Engineers and Services Ltd., as claimed by the assessee. - Decided in favour of assessee.
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2019 (6) TMI 1610 - CESTAT KOLKATA
Reversal of CENVAT Credit - payments have not been made to the service provider - violation of provisions of Rule 4(7) of the CCR or not - HELD THAT:- The issue is no longer res-integra. The Delhi Bench of this Tribunal in the case of M/S. HINDUSTAN ZINC LTD. VERSUS C.C.E., UDAIPUR [2017 (9) TMI 1639 - CESTAT DELHI] has held that In the present case, the appellants retained a portion of the consideration towards service rendered by the service provider in terms of contract towards performance guarantee. We note, the Board's clarification is applicable to the facts of the present case. Identical set of facts came up for decision before the Tribunal in many cases. In appellant's own case the matter has been decided holding that no reversal of credit under Rule 14 can be ordered in such situation.
The legal position stands settled in favour of the appellant and against the Revenue - the objection raised by the Department is not sustainable and the appellant is legally entitled to CENVAT credit - Appeal allowed - decided in favor of appellant.
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2019 (6) TMI 1609 - CESTAT KOLKATA
Valuation of imported goods - used and worn unmutilated and fumigated mix cloth - violation of Import Trade Control restrictions - Confiscation - redemption fine - penalty - HELD THAT:- The enhancement of value has been ordered by the First Appellate Authority on the basis of concurrence given by the importer for such enhancement. There is no challenge to the order of confiscation, but Revenue is challenging the quantum of redemption fine and penalty, which stand reduced by the Ld. Commissioner (Appeals).
The Ld. Commissioner (Appeals) has ordered reduction of redemption fine and personal penalty on the basis of ratio laid down by the Three Member Bench of CESTAT, Delhi in the case of M/S. OMEX INTERNATIONAL VERSUS COMMISSIONER OF CUSTOMS, NEW DELHI [2015 (4) TMI 112 - CESTAT NEW DELHI (LB)]. The Three Member Bench has taken the view that redemption fine of 10% and penalty of 5% of the value of the imported goods, would be appropriate in case of import violating Exim Policy Provisions - the quantum of redemption fine and penalty reduced.
Appeal dismissed - decided against Revenue.
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2019 (6) TMI 1608 - ITAT MUMBAI
Revision u/s 263 - assessee was a beneficiary of accommodation entry - Reopening of assessment - distinguishing the order passed after proper inquiry and without inquiry - reassessment has been completed twice and no adverse opinion was recorded by both the officer - assessee contended that the assumption of jurisdiction under section 263 is wrong, when the transaction has been verified twice; therefore, the assessment order passed under section 143(3) cannot be revised - HELD THAT:- PCIT, before holding an order to be erroneous, should have conducted necessary enquiries or verification in order to show that the finding given by the assessing officer is erroneous, the ld PCIT should have shown that the view taken by the AO is unsustainable in law. In the instant case, the ld. PCIT has failed to do so and has simply expressed the view that the assessing officer should have conducted enquiry in a particular manner as desired by him. Such a course of action of the ld. PCIT is not in accordance with the mandate of the provisions of sec. 263 of the Act.
Revenue has argued that the newly inserted Explanation 2(a) to sec. 263 of the Act is applicable on the facts of the present case. Even though there is a doubt as to whether the said explanation, which was inserted by Finance Act 2015 w.e.f. 1.4.2015, would be applicable to the year under consideration, yet we are of the view that the said Explanation cannot be said to have over ridden the law interpreted in JYOTI FOUNDATION [2013 (7) TMI 483 - DELHI HIGH COURT]
If that be the case, then the ld. PCIT can find fault with each and every assessment order, without conducting any enquiry or verification in order to establish that the assessment order is not sustainable in law and order for revision. He can also force the AO to conduct the enquiries in the manner preferred by ld. PCIT, thus prejudicing the independent application of mind of the AO. In our considered view this could not be the intention of the legislature in inserting Explanation 2 to sec. 263 of the Act, since it would lead to unending litigations and there would not be any point of finality in the legal proceedings.
As held in the case of Parashuram Pottery Works Co. Ltd. v. ITO [1976 (11) TMI 1 - SUPREME COURT] that there must be a point of finality in all legal proceedings and the stale issues should not be reactivated beyond a particular stage and the lapse of time must induce repose in and set at rest judicial and quasi-judicial controversies as it must in other spheres of human activity.
Clause (a) of Explanation to section 263 states that an order shall be deemed to be erroneous, if it has been passed without making enquiries or verification, which should have been made. In our considered view, this provision shall apply, if the order has been passed without making enquiries or verification which a reasonable and prudent officer shall have carried out in such cases, which means that the opinion formed by ld PCIT cannot be taken as final one, without scrutinising the nature of enquiry or verification carried out by the AO vis-à-vis its reasonableness in the facts and circumstances of the case -in our view, the question as to whether the amendment brought in by way of Explanation 2(a) shall have retrospective or prospective application shall not be relevant.
Turning to the fact of the present case again, AO has accepted the explanations of the assessee, with regard to the transaction MSPL. The ld. PCIT has not identified any material that the explanations given by the assessee were wrong or incorrect. In our view the AO was satisfied with the explanations given by the assessee and did not make any addition. Hence, in our view, it cannot be held that the assessing officer did not carry out adequate enquiry or verification which should have been done. Thus, we are of the view that the assessing officer has taken a plausible view in the facts and circumstances of the case.
PCIT has not brought any material on record by making enquiries or verifications to substantiate his inferences. He has also not shown that the view taken by him is not sustainable in law. PCIT has passed the impugned revision orders only to carry out fishing and roving enquiries with the objective of substituting his views with that of the AO. Hence we are of the view that the ld. PCIT was not justified was not correct in law in holding that the impugned assessment orders were erroneous.
PCIT has failed to show that the impugned assessment orders passed by the assessing officer were not only erroneous but also prejudicial to the interests of the revenue. It is a well established proposition that both the above said conditions are required to be satisfied before invoking the revisional powers given under section 263 of the Act. In the instant case, we are of the view that the ld. PCIT has failed to show that both the conditions exist in the instant case. Accordingly we set aside the revision orders passed by ld. PCIT. - Decided in favour of assessee.
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2019 (6) TMI 1607 - CESTAT KOLKATA
Levy of penalty - failure to file monthly return - appellants have accepted the default, but have pleaded that the same was unintentional and prayed for setting aside the penalty - HELD THAT:- The proceedings were initiated for failure to file ER-6 monthly return for the period 2012-13, 2013-14 & 2014-15. The appellants were required to submit, within ten days from the close of each month, a monthly return in the Form specified by a Notification in respect of the information regarding the receipt and consumption of each principal inputs with reference to the quantity of final products manufactured by them to the Range Superintendent. This requirement was notified by Notification No.41/2004-CE (NT) dated 25.11.2004. Simultaneously, Notification No.39/04-CE (NT) dated 25.11.2004 was also issued, which extended the exemption from filing such return to the assessee, whose payment of excise duty through account current during preceding financial year, was less than ₹ 1.00 Crore. Subsequently, the expression “through account current” was omitted by Notification No.41/2008-CE (NT) dated 29.09.2008 - This Notification escaped the attention of the assessee, which resulted in failure to file ER-6 return upto March, 2016. The appellants have accepted the default, but have pleaded that the same was unintentional and there has not been any loss of revenue to the exchequer and accordingly, prayed for setting aside the penalties imposed.
A lenient view can be taken and quantum of penalty can be reduced to meet the ends of justice and accordingly, the quantum of penalty reduced to ₹ 500/- per return for non-filing of each such return. The total amount of penalty would be ₹ 500/- X 36 ER-6 Returns under Rule 15A of Cenvat Credit Rules, 2004.
Appeal allowed in part.
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2019 (6) TMI 1606 - ITAT MUMBAI
Unexplained Cash Credit u/s. 68 - addition was made on account of failure of assessee in substantiating the creditworthiness in respect of the loans shown from M/s. Basant Marketing Pvt. Ltd. In the balance sheet - HELD THAT:- We find that the identity, credit worthiness and genuineness of the BMPL is not in dispute. Sufficient evidence has been given in these cases to prove the identity, genuineness and creditworthiness of the M/s Basant Marketing Pvt.Ltd. The CIT(A) has specifically pointed out this fact that no evidence is on record to which identity, creditworthiness and genuineness of the claim of the loan can be doubted. Taking into account was all these facts and circumstances, we are of the view that CIT(A) has decided the matter of the controversy judiciously in correctly which is not liable to be interfere with at this appellate stage. Accordingly, these issues are decided in favour of the assessee against the revenue.
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2019 (6) TMI 1605 - CESTAT KOLKATA
Duty on Superior Kerosene Oil (SKO) - duty was paid on Interface quantity of SKO by adopting assessable value of SKO (non-Public Distribution System (PDS) at the prevalent rate - case of the department is that the appellant, instead of paying excise duty on the interface quantity of SKO as per rate prevalent for SKO, they should have paid excise duty higher of the two duties, after determining the duty payable on SKO and duty payable on MS/HSD - CBEC Circular No. 636/27/2002-CX dated 22.04.2002 - HELD THAT:- The fact is not in dispute that while clearing the goods, the appellant have cleared from the factory quantities of MS, HSD and SKO separately. Since all the three goods are supplied through a pipeline, the SKO get mixed with either MS or HSD. As per the provisions of Section 4, the excise duty is payable on the transaction value at the time of removal of the goods from the factory. In the present case, the goods cleared from the factory is MS/HSD and SKO. Accordingly, the duty on these products is payable as per price of the respective product prevailing at the time of removal of the goods.
Removal of goods, intermixing of SKO with MS/HSD amounts to manufacture or not - HELD THAT:- There is no charge in the Show Cause Notice that the activity of supplying HSD/MS with interface SKO amounts to manufacture. Therefore, on this point, the adjudication order travelled beyond the scope of show cause notice which is not permissible in the law - the activity specified in the said clause (iii) will amount to manufacture only in respect of the goods specified under Third schedule. It is undisputed that the products of the appellant are not specified under third schedule, therefore, whatever activity mentioned in clause (iii) shall not apply to the goods which are not specified in Third schedule. For this reason, intermixing of SKO with HSD/MS does not amount to manufacture.
Applicability of CBEC Circular No. 636/27/2002-CX dated 22.04.2002 - HELD THAT:- The Circular suggests that even on clearance of SKO, the price of HSD/MS should be applied. However, this proposal of the Board Circular does not flow from any statutory provision. As discussed above, the appellant have correctly applied the price of respective goods cleared from the factory at the time of removal. Therefore, we do not find any support of any statutory provisions in the Board Circular.
The differential duty demand raised on interface quantity of SKO is clearly not sustainable - Appeal allowed - decided in favor of appellant.
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2019 (6) TMI 1604 - CESTAT KOLKATA
Refund of Excess duty - refund claim has been kept in abeyance and the provisional assessment finalized - time limitation - HELD THAT:- During the pendency of the appeal of the Department before the Tribunal, the subsequent events from January 18, 2016 to July 6, 2017, as detailed in the above chronology of events, makes it clear that the adjudicating authority has, pursuant to the impugned order of the Commissioner(Appeals), held a fresh personal hearing in the matter and passed an adjudication order on January 22, 2016 - It is therefore clear that the Department has compiled with the order dated March 18, 2010 of the Commissioner(Appeals) and has given effect thereto. As such, the present appeal of the Department has been rendered infructuous. Both sides agree to this.
The appeal filed by the Department is dismissed as infructuous.
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