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Showing 121 to 140 of 1466 Records
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2023 (1) TMI 1347
Scope of ‘limited scrutiny’ - conversion of the case from limited scrutiny to complete scrutiny - whether assessment order can’t be revised other than the reason(s) of ‘limited scrutiny’ assessment? - sale of penny stock - whether the reasons (issues) other than reasons for selection of the case under ‘Limited Scrutiny’ were so glaring that the Assessing Officer should have considered the matter for converting limited scrutiny to comprehensive scrutiny?
HELD THAT:- We are of the opinion that an AO having entrusted of the duty of scrutinizing the assessment, his investigative skill would have ignited him to believe that those matters prima facia have potential scope of escapement of income, and correspondingly, in view of instructions reproduced above he should have acted upon for converting the case of limited scrutiny to complete scrutiny. These instructions have been issued by the CBDT for guidance of the AO and are binding on the Income-tax Authorities concerned. We are of the opinion that there is a clear fault on the part of the AO in not referring the matter of converting the limited scrutiny case into complete or comprehensive scrutiny and this inaction is without application of the mind which bring the assessment order under the category of “order erroneous insofar as it is prejudicial to the interest of the Revenue” without enquiring and accepting the claims blindly, which resulted in loss to Revenue.
Taxation of ‘whole of the sale consideration’ on sale of shares as against ‘long term capital gain’ on such sale of shares or penny stock considered by the AO - We have already held in preceding paragraphs that the issue of sale of penny stock is germane to the issue of limited scrutinty of examining increase in capital of the assesee during the year. PCIT has held that the Assessing Officer has given erroneous finding on this issue of limited scrutiny.
In the case in hand before us, the assessing Officer has treated the amount of long-term capital gain arising from sale of penny stock only as unexplained cash credit for section 68 of the Act, which was computed by way of reducing cost of acquisition of penny stock out of sale consideration of those penny stock. In our opinion, when entire credit from whole of sale consideration of Penny stock was received during the year under consideration, the Assessing Officer is not justified in making addition for only a part of the same and not to make addition for the remaining part.
There are no two views on this issue. Either the entire credit is liable for addition or not, there is no middle path. Therefore, the Assessing Officer has committed an error on the issue in dispute.
Counsel has not pointed out any decision where a part of the credit has been added by the Assessing Officer and part has been left over or not considered for addition without any justifiable reasons. In such circumstances, we uphold the finding of the PCIT on the issue in dispute that whole of the sale consideration was required to be assessed by the AO Instead of only long term capital gain - order of the AO is erroneous to this extent. The Ground Nos. 3,5 &6 of the appeal of the assessee are accordingly dismissed.
Whether PCIT was not justified in revising the assessment order on the issue which was already pending available before the Ld.CIT(A) for consideration? - We find that the Ld.PCIT has held that the particular issue will be out of the jurisdiction of the Ld.PCIT if the Ld.CIT(A) has considered and decided the matter by giving his finding. PCIT has relied on the decision of Ranka Jewellers [2008 (1) TMI 497 - ITAT PUNE-A] wherein the Tribunal has held that in view of Explanation (c) of section 263, the assessment considered and decided are conjoined with a conjunction and therefore, both the conditions have to be fulfilled.
PCIT has also referred to the judgement of Panna Knitting Industries [2000 (12) TMI 23 - GUJARAT HIGH COURT] wherein it is held that if part of the claim was considered by the Ld.CIT(A) and rest of the part undecided, then portion of the claim cannot be said to be merged with the order of the Ld.CIT(A) and order of the revision in respect of the part which remained undecided was held to be valid. In view of above, we do not find any infirmity in the findings of the Ld.PCIT.
Taxation of entry operator charges - assessee submitted that this issue was not raised in the show cause notice issued by the Ld.PCIT and, therefore, in the final part of the order he cannot hold the order erroneous insofar as it is prejudicial to the interest of the Revenue on this issue without providing opportunity of being heard - HELD THAT:- In our opinion, the submission of the Ld. Counsel of the assessee are justified. Before holding the order of the Assessing Officer as erroneous insofar as it is prejudicial to the interest of the Revenue on any particular issue, it is sine qua non to issue notice to the assessee and the action of the Ld.PCIT is in violation of the principles of natural justice. To this extent, we are of the opinion that the order of the Ld.PCIT cannot be sustained.
Issues which were not covered under limited scrutiny - We are of the opinion that under the mandate of ‘Limited Scrutiny’, the Assessing Officer was not authorised to enquire on the issues other than the reasons for which it was taken for scrutiny purpose unless approved so by higher authorities. Since no approval was taken for converting the case from ‘Limited Scrutiny’ to ‘comprehensive or complete scrutiny’, the Assessing Officer was not authorised for enquiry on the issues challenged by the assessee in ground Nos. 8 to 15. The Ld. PCIT can find fault for not referring the matter of converting ‘Limited Scrutiny’ case to ‘Comprehensive Scrutiny’ case, but no such approval has been taken by the Assessing Officer and hence the Assessing is barred from examining those issues under the mandate of limited scrutiny. Thus, the assessment order cannot be held erroneous insofar as prejudicial to the interest of Revenue for not making enquiry on those issues. The relevant grounds of the appeal of the assessee are accordingly allowed.
Finding of PCIT that Assessing Officer has failed to examine the issue properly and applied his mind - As the finding of AO on the issue of increase in capital (i.e. the one of the reasons of limit scrutiny) is erroneous and due to consequential revenue loss, the assessment order is erroneous in so far as prejudicial to the interest of revenue to that extent.
As far as other issues on which the Ld. PCIT has held the order as erroneous in so far as prejudicial to the interest of revenue are concerned, we have rejected the finding of the Ld PCIT and held that the assessment order is erroneous to the extent that the AO has not followed the instruction of the CBDT. Therefore, it is open for the Assessing Officer during consequential proceedings to seek approval from the higher authoritiesin compliance to the instructions of the CBDT (supra) for converting the limited scrutiny case to complete scrutiny.
Appeal of the assessee is accordingly partly allowed.
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2023 (1) TMI 1346
Benefit of exemption u/s 11 and 12 - exemption denied on income from exhibition - assessee has been registered for the charitable purpose of advancement of any other object of general utility for promotion of export of gems and Jewellery, therefore, the activity of conducting exhibitions being in the nature of trade, commerce or business, the assessee is not entitled for exemption - whether the activity of conducting exhibitions & trade fair by the assessee amounts to trade, commerce or business or activity of rendering services in relation to trade, commerce or business? - HELD THAT:- The proviso to section 2(15) is attracted in case charitable activity in the nature of ‘general public utility’. The issues adjudicated by the Hon’ble Supreme Court in Ahmedabad Urban development authority [2022 (11) TMI 255 - SUPREME COURT] are related to determining the scope of the phrase “general public utility” (GPU) in the definition of “charitable purposes” primarily on the grounds that the institutions were carrying on trade, commerce or business for consideration, which does not qualify as GPU under the provisions of the Act as amended by Finance Act (FA), 2008 read with subsequent amendments.
Before the Hon’ble supreme court (supra), in the cases of most of the entities, there is no dispute as to the activities involved in the appeal qualified as GPUs within the meaning of the term “charitable purposes”, but the dispute was in respect of the meaning of “fee, cess or other consideration” and its impact on construing whether the activity falls under to the description of “trade, commerce or business”.
Hon’ble Supreme Court held that where “fee, cess or other consideration” is statutorily fixed or where it represents recoupment of cost or cost with nominal mark up, the activity may not be construed as “trade, commerce or business” and will be excluded from the mischief of commercial activity under the amended provision. If, however, “fee, cess or other consideration” charged is substantially higher over cost, it is tainted with “trade, commerce or business” and will qualify for tax exemption only if receipts are within the quantitative limit prescribed by the amended provision.
As in the instant case it is evident that assessee has charged fee or consideration for conducting exhibitions or trade fair is slightly below the cost. The Hon’ble Supreme Court has held that activity of renting space to individual exhibitors or exporters in the exhibition or trade fair is a service in relation to trade commerce or business, but in the instant case, there being no markup on consideration charged from the exporter, therefore, in the broad principles laid down by the Hon’ble Supreme Court, the activity is beyond the purview of either trade, commerce and business or activity of rendering services in relation to trade, commerce or business.
Counsel also referred to the annual report for the year under consideration having discussion regarding promoting ‘brand India’ by way of holding of exhibitions and participation in exhibitions held by overseas trade promotion bodies.
We are of the opinion that assessee is not hit by the proviso to section 2(15) of the Act as far as activity of conducting or participating in exhibitions within India or overseas and therefore the disallowance of exemption claimed by the assessee made by the Assessing Officer and the finding of the Ld. CIT(A) on the issue in dispute are set aside and matter restore back to grant benefit of section 11 and 12 as per provisions of law. The ground No. 1 to 4 of the appeal of the assessee are accordingly allowed for statistical purposes.
Also as the claim of exemption under section 11 has been allowed to the assessee by us, therefore, the Assessing Officer is directed to allow the claim of the assessee of carryforward of the deficit.
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2023 (1) TMI 1345
Revision u/s 263 - ALV determination of property under the head income from house property - CIT has discussed on the Provisions of Sec. 22 r.w.s 23(1)(a) of the Act and is of the opinion that the assessee was owner of flats which constitute property within the meaning of Sec. 22 of the Act and therefore the annual value of the flats owned by the assessee is form part of the closing stock and is taxable under the head income from house property in the A.Y 2017-18 and the AO has not considered these facts and excluded
Contentions of the Ld. AR that when the charging of income under income from house property applying the deemed provisions is applicable from A.Y.2018-19 is a debatable and therefore revision proceedings shall not sustained
HELD THAT:- AO in the assessment proceedings having satisfied with the claim has not made any comment on the issue. Further the contentions of the Ld. AR that the ALV of the house property held as stock in trade has to be considered on deeming provisions as per finance Act 2017 from the A.Y 2018-19 and whereas the current A. 2017-18. Further if any query is raised in the assessement proceedings and it was responded by the assessee, mere fact that it is not dealt with by the A.O. in the order cannot implied that there is no application of mind.
Therefore observations of the Pr.CIT cannot be acceptable as the order passed by the A.O. does not satisfy the twin conditions of erroneous and prejudicial to the interest of the revenue. Appeal of assessee allowed.
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2023 (1) TMI 1344
Seeking grant of pre-arrest bail - forgery - proceedings under Section 82 of CrPC have already been initiated - applicant had not been cooperating with the investigation - HELD THAT:- In the present case, the accused persons are not only found to have committed the offence of cheating but also committed the offence of forgery. The applicant, at this stage, cannot be said to be only an accomplice. The allegations and the investigation carried out till this stage points out towards the active role of the applicant in the commission of the offence - The applicant has not cooperated at all in the investigation, which led to the issuance of non-bailable warrants by the concerned Trial Court. The proceedings under Section 82 of CrPC have already been initiated.
Pre-arrest bail is to be granted only when the court is convinced that circumstances exist to resort to that extraordinary remedy and cannot be a matter of routine. Custodial interrogation is a recognized mode of investigation which is not only permitted but is held to be more effective - Even though the accused Bhuvan Chand is in custody, the forged documents as well as the cheated amount is yet to be recovered. The offence cannot be held to be of minor nature. The applicant has been named by not only the complainant but also other public witnesses to be actively involved with the accused ‘Bhuvan Chand’. It cannot be said that the custodial interrogation of the Applicant is not required at this stage.
The order of bail in anticipation of arrest cannot be granted for it to be used as a shield. In the facts of the present case, it cannot be said, at this stage, that the allegations made against the applicant are frivolous or have been made to falsely implicate the applicant - Keeping in mind the nature of allegations, and the fact that the applicant has not joined and cooperated in investigation which has also led to initiation of proceedings under Section 82 of CrPC, this Court feels that it is not a fit case for exercise of discretion under Section 438 of CrPC.
Application dismissed.
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2023 (1) TMI 1343
Permission for withdrawal of appeal - HELD THAT:- It is pointed out before us that Civil Appeal Diary No.21189/2021 already stands dismissed as withdrawn on 27.09.2021.
Out of two connected matters, one of them is not on Board before us today which is mentioned in the Office Report i.e. Civil Appeal Diary No.21188/2021 - Civil Appeal Diary No.21188/2021 is taken on Board.
The appeals are dismissed as withdrawn accordingly.
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2023 (1) TMI 1342
Disallowance u/s 14A r.w.r. 8D - assessee has made investments yielding exempt income and hence section 14A read with Rule 8D requires disallowance - CIT(A) deleted addition - HELD THAT:- We observe that the Ld. CIT(A) has made a detailed discussion of the entire gamut of issue by considering factual and legal aspects and came to conclude that the disallowance u/s 14A / Rule 8D was not warranted in the present case. Clearly, therefore, there is no infirmity in the findings made by Ld. CIT(A). Before us, the Revenue has not rebutted the findings by placing any contrary material on record.
Unaccounted interest payment on cash-loans - addition made as during the course of search, the authorities seized a laptop from the premise of assessee wherein a company named “XYZ 08092” was found in tally-data and also seized loose papers marked as “LPS-1 to 8” from the premises of Shri G.C. Patidar, an employee of assessee - HELD THAT:- The laptop is seized from the office of assessee. Hence by virtue of section 292C, the laptop is presumed to be owned by assessee. Although the assessee claimed that the laptop belonged to Shri Nilesh Tawtech who had expired on 21.12.2010, it was for the assessee to bring some evidence to rebut the presumption of section 292C which had not been done. If the laptop belonged to Shri Nilesh Tawtech, how could it be retained by assessee till the date of search on 27.08.2014 and not handed over to the heirs of Shri Nilesh Tawtech?
Laptop was containing Tally-data in the name of “XYZ 0809 2” company. On verification of tally-data, the authorities have found that it contained accounted-transactions of assessee besides unaccounted transactions. Ld. AO is, therefore, correct in concluding that the tally data, which contained the accounted-data of assessee as well, certainly belonged to the assessee.
AO has analysed the nature of transactions found in tally-data; corroborated the same with the loose-papers found at the premise of Shri G.C. Patidar, another employee of assessee. To illustrate, the Ld. AO has mentioned working of interest-calculations in Point No. 6/Page No. 80 of the assessment-order. The loose-papers seized from Shri G.C. Patidar are also natural documents, for example the excel-sheeof the assessment-order clearly reveals, the original cash-transactions done by assessee, subsequent modifications done therein, the names of parties, dates, amounts; captions such as “paid” “PAID” “to be returned” etc. which are not fictional entries. On Page No. 84 of the assessment-order, the Ld. AO has also made a corroboration of the data recorded in tally-system with the papers seized from Shri G.C. Patidar.
AO has stated that the BS-4 seized by authorities contained a diary which shows a social relationship of assessee with the lenders. But, however, Ld. CIT(A) has rejected the AO’s finding by saying that the names of those persons do not match with the names of lenders. The observation, whether the names of persons matched or not and hence the assessee had social relationship with those persons or not, is at the best an ancillary point only and cannot be taken as a tool to dislodge the cash-loans taken by assessee, which are very much recorded in the tally-data / loose-papers seized.On going through these statements, we observe that Shri G.C. Patidar has not only admitted the cash-loans taken by assessee but also explained the modus operandi adopted in that regard. These statements, which are recorded during the proceeding of section 132(4) have an evidentiary value and cannot be taken lightly.
Thus there is a clear admission by Shri G.C. Patidar of three vital points, viz (i) he made loose papers; (ii) the loose papers were under the instructions of Shri Puneet Agarwal (Shri Puneet Agarwal was director of assessee-company); and (iii) those loose papers were entered by Shri Nilesh Tavrech in the tally-data in laptop. AO has rightly concluded that the assessee has taken cash-loans from various lenders and paid interest thereon from undisclosed sources. Being so, we reverse the action of Ld. CIT(A) and uphold the addition made by Ld. AO. Decided against assessee.
Unaccounted interest payment on cash-loans - seized document which is the basis of making addition seized from third party - HELD THAT:- We agree with the observations made by Ld. CIT(A) that the impugned seized document which is the basis of making addition in the hands of assessee, was in fact seized from the premise of AIDPL and not from assessee, hence no presumption u/s 292C can be drawn against assessee; (ii) no addition can be made on the assessee u/s 153A on the basis of document found during search conducted upon someone else, particularly because the AY 2009-10 under consideration is a non-abated assessment-year; and (iii) the Ld. AO has not provided any opportunity of cross-examination of AIDPL to the assessee before relying upon the document found in possession of AIDPL. Thus, keeping in view these serious infirmities, the Ld. AO is not justified in using the impugned document against assessee.
Bogus payment to petrol pumps - authorities seized certain excel sheets from DGM of assessee, which contained details of unaccounted cash-receipts by the assessee from certain petrol pumps - HELD THAT:- We observe that the Ld. CIT(A) has rightly observed that the addition was warranted to the extent of unaccounted cash-receipt only. We further observe that the excel-sheet reproduced by Ld. AO in assessment-order demonstrates that there was no cash-receipt at least during the previous year 2010-11 relevant to AY 2011- 12 under consideration. Being so, the Ld. CIT(A) is very much correct in concluding that no addition was warranted in AY 2011-12. We countenance the conclusion taken by Ld. CIT(A) whereby he has deleted the addition.
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2023 (1) TMI 1341
Disallowance u/s 14A r.w.r. 8D - case of the assessee that the own interest free reserves are far more than the amount of investment, therefore, no disallowance u/s 14A r.w.r 8D(2)(ii) of the Rules should have been made with regard to the interest element - HELD THAT:- The said issue has been decided in Assessee’s own case for A.Y.2011- 12, 2012-13 [2023 (7) TMI 1357 - ITAT DELHI] By respectfully following the order in assessee’s own case, we are of the opinion that disallowance under Rule-8D(2)(ii) of the IT Rules should not have made by the AO, thus, the disallowance made by the AO is hereby deleted. Further, we direct the AO to compute the disallowance u/s 14A r.w.Rule-8D(2)(iii) of the Rules by considering only investment from each exempt income is earned. Accordingly, ground No.1 of the Revenue and the assessee are disposed off.
Unexplained investment - search was conducted on the assessee wherein an estimated working was seized from the Laptop of the employee of the assessee containing details of certain land which was registered in the name of the assessee - HELD THAT:- It is well settled law that the dumb documents having no evidentiary value cannot be taken as sole basis for determination of undisclosed income of the assessee. If the Department of Revenue wants to make use of dumb documents, then the onus on the Revenue Department to collect cogent corroborative evidences. As decided in the case of Mumar Trading Co. 2007 (9) TMI 284 - HIGH COURT OF JUDICATURE AT ALLAHABAD] held that, it is settled principle of law that if the Revenue wants to rely upon the entries of the document, seized from the premises of third party, the burden lies upon the Revenue Authorities to prove the genuineness and authenticity of the said entries to connect the said entry with the dealer.
As found that the person from who’s possession the seized document is recovered, was not subject to the cross examination of the assessee and no opportunity of cross examination has been given to the assessee. Therefore, for the detailed discussion made above, in our considered opinion, AO as well as the CIT(A) have committed error in making the addition u/s 69 of the Act which deserves to be deleted. Accordingly, the ground No.2 of the assessee is allowed and the subject addition sustained by the Ld. CIT(A) is deleted.
Allowability of claim of education Cess - HELD THAT:- In view of the above settled position of law, we hold that the education Cess can’t be allowed as an allowable expense, accordingly, we find no merit in Ground of the assessee and the Ground assessee is dismissed.
Nature of receipt - FPS/FMS receipt - capital receipt received as per foreign trade policy in computing the total income of the assessee - HELD THAT:- The issue of claim of FPS/FMS as capital receipt received as per foreign trade policy in computing total income has been dealt and decided by the Co-ordinate Bench of the Tribunal in Assessee’s own case for Assessment Year 2013-14 in favour of the assessee [2023 (7) TMI 1357 - ITAT DELHI] Apart from the same, the Hon'ble High Court of Rajasthan in the case of Principal Commissioner of Income Tax, Ajmer Vs. Nitin Spinners Ltd [2019 (9) TMI 1154 - RAJASTHAN HIGH COURT] held Focus Marketing Scheme was concerned, apparently the Central Government gave the subsidy to enhance Indian export potential in the international market. It was not granted to meet the cost of expenditure to meet the competition of the Indian textile market. The ITAT took note of judgment in Ponni Sugars & Chemicals Ltd. [2008 (9) TMI 14 - SUPREME COURT] and held that the amount was not an export incentive, but rather capital receipt and therefore, not taxable. This Court is of the opinion that there is no infirmity with the reason. Judgment of the Hon'ble High Court of Rajasthan has also been affirmed by the Hon'ble Supreme Court wherein the SLP filed by the Department has been dismissed which is reported [2021 (9) TMI 430 - SC ORDER]
Interest subsidy under TUFFS - capital or revenue receipt - HELD THAT:- The allowability of claim of interest subsidy under TUFFS and RIPS have been decided by the Hon'ble High Court of Rajasthan in the case of PCIT vs. Nitin Spinners Ltd. [2019 (9) TMI 1154 - RAJASTHAN HIGH COURT] the amount was received as capital stream and therefore, not taxable.
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2023 (1) TMI 1340
Assessment of income as per the original return or revised return - case was picked up for limited scrutiny - AO has taken up the returned income as per the original return of income only on the ground that the case was selected for scrutiny of the original return of income - HELD THAT:- Action of the Assessing Officer taking returned income as per the original return of income only is not justified at all. The original return of income of the assessee was substituted by the revised return of income which was filed within the prescribed time period.
The case was selected for scrutiny on two issues, which the assessee successfully explained before the AO, therefore, as supposed to assess the income as per the revised return of income. If the AO wanted to scrutinise any other issue also including the withdrawal of interest income, which the assessee claimed to be erroneously offered, the AO could have got converted the limited scrutiny assessment into full assessment by getting permission from the competent authority.
Even otherwise, AO has merely taken the returned income as per original return of income without making any disallowance in respect of above issue in the revised return of income. Therefore, the action of the lower authorities in taking the returned income as per original return of income is not justified as the assessee had already filed a valid revised return within the statutory period and has also explained the issues satisfactorily to the AO for which the return was selected for limited scrutiny. In view of this, the impugned order of the CIT(A) is set aside and the AO is directed to accept the income of the assessee as per the revised return of income. Appeal of the assessee stands allowed.
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2023 (1) TMI 1339
Cancellation of GST registration of the petitioner - obtaining such registration by fraud, wilful misstatement or suppression of facts - HELD THAT:- Section 29(2)(e) of the CGST Act undoubtedly enables the proper officer to cancel the registration even with retrospective effect. However, it should be borne in mind that such cancellation may be effected under clause (e) only based on material supporting an inference that the registration was obtained by means of fraud, wilful misstatement or suppression of facts. In this case, the registration was obtained in the year 2019 and no material has been placed on record to support the inference that the registration was obtained in early 2019 by means of fraud, wilful misstatement or suppression of facts. Therefore, the impugned order calls for interference.
The impugned order is quashed and the matter is remanded to the first respondent. Consequently, the respondents are directed to restore the registration subject to the outcome of re-adjudication.
Petition disposed off by way of remand.
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2023 (1) TMI 1337
Accrual of income in India - income from External Commercial Borrowings ("ECB") - claim of exemption u/s 90 r/w Article 11 of the DTAA as the company was carrying on bona fide banking business in Mauritius - ITAT allowed assessee's appeal and by the impugned order held that the interest income on securities was exempt from tax in India under Clause (c) of Article 11(3) of the DTAA - whether assessee in involved in bonafide banking activity? - Revenue's case is that Clause (c) of Article 11 of the DTAA will not apply to assessee. This is because assessee does not have a banking business license from the Reserve Bank of India.
HELD THAT:- To fall under Clause 3(c) of Article 11 of the DTAA, assessee need not have to be carrying on banking business in India. Assessee should only be a resident of Mauritius and must be carrying on bona fide banking business in Mauritius. We have to note that in the draft assessment order dated 30th March 2015 passed under Section 144C (1) r/w Section 143(3) of the Act, the AO while granting exemption to the interest on ECB has accepted that assessee is carrying on bona fide banking business in Mauritius. So also in the final assessment order dated 28th January 2016. Therefore, the fact that assessee is carrying on a bona fide banking business in Mauritius is not disputed.
Under Article 11(3) of the DTAA interest arising in a contracting state (in this Case India) shall be exempt from tax in that State (in India) provided it (the Income) is derived and beneficially owned by any bank carrying on a bona fide banking business which is a resident of the other contracting State (Mauritius). Therefore, so long as assessee is carrying on bona fide banking business in Mauritius being a resident of Mauritius, the interest that assessee would earn in India shall be exempt from tax in India.
If we have to accept, what DR submitted, that assessee should have had a banking license from the Reserve Bank of India, then what would be applicable is Clause 6 of Article 11 of the DTAA and that has not been relied upon by the AO. Moreover, the AO has, as noted earlier, granted exemption to the interest on FCB by accepting that assessee is carrying on bona fide banking business in Mauritius.
No infirmity in the order passed by the ITAT. No substantial question of law.
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2023 (1) TMI 1336
Condonation of delay of 445 days in filing appeal - sufficient cause for condonation of delay present or not? - It was held by High Court that In the present case after appreciating the matter it cannot be said that there was sufficient cause for condonation of delay.
HELD THAT:- In the peculiar facts and circumstances of this case, interference is not called for. However, the question of law decided by the High Court is kept open.
The Special Leave Petition is dismissed.
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2023 (1) TMI 1335
Benami transaction - Beneficial owner of property - Provisional attachment order - scope of Amendment Act of 2016 - Amendment to Prohibition of Benami Property Transactions Act, 1988 as amended by the Benami Transactions (Prohibition) Amendment Act, 2016 - HELD THAT:- The issue raised in these petitions is squarely covered by the judgment of this Court in Union of India & Anr. vs. Ganpati Dealcom Pvt. Ltd. [2022 (8) TMI 1047 - SUPREME COURT] as held Section 2 (9) (A) and Section 2 (9) (C) are substantive provisions creating the offence of benami transaction. These two provisions are significantly and substantially wider than the definition of benami transaction under Section 2 (a) of the unamended 1988 Act. Therefore, Section 2 (9) (A) and Section 2 (9) (C) can only have effect prospectively. Central Government has notified the date of coming into force of the Amendment Act of 2016 as 01.11.2016. Therefore, these two provisions cannot be applied to a transaction which took place prior to 01.11.2016.
As petitioners contends that review of the said judgment is pending.
Since as of now the issue stands covered by the judgment in the case of Ganpati Dealcom Pvt. Ltd.(supra), we dismiss these special leave petitions for the same reasons and ground.
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2023 (1) TMI 1334
Reimbursement of amount of Service Tax - maintenance of street lights - if petitioners were required to pay service tax, then whether the same, if at all, could be recovered from respondent no.1 i.e., Municipal Corporation of Delhi (MCD) or not? - It was held by High Court that During the relevant period, there was no exemption operating qua the payment of service tax on the maintenance of street lights - HELD THAT:- There are no reason to interfere with the impugned judgment and order passed by the High Court. As such, the view taken by the High Court agreed upon.
SLP stands dismissed.
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2023 (1) TMI 1333
Addition to share capital u/s 68 - unexplained cash credit - HELD THAT:- The assessee furnished all such details of the lenders/ depositors. We further find that there is no allegation of assessing officer that any of such lenders/ creditors are part of syndicate of accommodation entry provider. Majority of the investor either in the equity shares or preference shares are made by the group company or by promotor at the face value of the shares. There is no evidence that investment in shares of assessee is a result of some circular transactions. In view of the afforesaid factual discussions, we do not find any illegality or infirmity in the finding of the ld CIT(A), which we affirm with our additional observation. In the result, the grounds of the appeal raised by the revenue is dismissed.
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2023 (1) TMI 1332
Levy of service tax - construction of Approach Roads and Residential Premises within the factory of Classic Marble Company Private Limited - difference in the figures recorded in ST-3 vis-a-vis the actual receipts - HELD THAT:- In light of Circular No. B1/6/2005-TRU dated 27.07.2005, it is apparent that the activity of construction of roads is beyond the service tax net and therefore, demand of service tax on construction of road cannot be sustained. The same is set aside and appeal to that extent is allowed.
Demand of service tax on residential houses made for their clients namely Classic Marble Company Private Limited - demand confirmed on the ground that the activity of construction of road is a composite contrat for not only for construction of road but also for residential premises - HELD THAT:- When the residential complex is built for self use then it remains outside the service tax net - the demand on the construction of road and residential premises cannot be sustained and the same is set aside.
Difference in the receipts towards exempted services shown in ST-3 return - HELD THAT:- It is seen that the impugned order does not contain adequate explanation for the said exempted services - The appellant has claimed that the variation is on account of inclusion of amount in service tax gross value/ VAT amount/ booking of TDS/ declaration of receipt entry - there are no mention of these facts in the impugned order nor does the impugned order contain any examination of this data. It is doubtful if this data was submitted before the original adjudicating authority - matter remanded back to original adjudicating authority to examine the reconciliation produced by the appellant, in these appeal papers decide afresh.
Appeal allowed in part and part matter on remand.
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2023 (1) TMI 1331
Anticipatory Bail - levy of additional condition that to submit passport, if any, before the trial Court and shall not leave India without prior permission of this Court - HELD THAT:- Once the apex Court seized of the matter and the impugned order is under challenge, it would not be proper for this Court to entertain this petition for modification of he order.
Petition dismissed.
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2023 (1) TMI 1330
Validity of order passed u/s 148A - re-assessment proceeding as beyond six years - jurisdiction of AO in issuance of the impugned notice u/s 148 of the Act being barred by limitation u/s 149(1)(a)/149(1)(b) - HELD THAT:- In the impugned order u/s 148A(d) of the Act, the assessing officer has tried to justify the initiation of re-assessment proceeding by relying on an instruction being No. 01/2022 dated 11th May, 2022 issued by CBDT. Admittedly, the issuance of notice and initiation of re-assessment proceeding are beyond six years and, prima facie, it is barred by limitation both under the old Act as well as under newly amended provision relating to Section 147 of the Act.
Considering the submission of the parties, it is of the view that this matter deserves adjudication by calling for affidavits from the respondents and the petitioner has been able to make out a prima facie case for an interim order by raising the issue of jurisdiction of the assessing officer concerned in initiating the impugned re-assessment proceeding.
Let the respondents file affidavit-in-opposition within four weeks; petitioner to file reply thereto, if any, within two weeks thereafter.
The matter shall appear for final hearing in the monthly list of April, 2023. In the meantime, there will be no further proceeding.
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2023 (1) TMI 1329
Maintainability of petition - availability of alternative remedy of appeal - HELD THAT:- The petition stands disposed of with liberty to the petitioner to avail the alternative remedy observing that the petitioner shall be at liberty to seek exclusion of time spent in prosecuting this petition.
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2023 (1) TMI 1328
Block assessment order passed u/s 158 BC - declaring undisclosed income after making additions on account of undisclosed receipt - CIT(A) deleted the additions made on account of (i) gift from Arvinder Pal Singh; (ii) notional rental income (iii) credits in bank account (iv) prize money, bonus money, match fee and tour fee (v) investment in purchase of jewellery (vi) investment in the purchase of property and sustained additions made on account of household expenses - ITAT deleted addition on account of household expenses - HELD THAT:- The deposit was in the name of HUF and the source of deposit was explained. The return in the name of HUF was furnished after receiving the notice from the department and the bank account belonged to HUF. The department had issued notice under Section 142 (1) of Act 1961 dated 02.04.2002 and the assessee filed return in the capacity of HUF. The Bank account was in the name of the HUF and not in the individual name of the assessee. The assessee explained the source of deposit in the HUF.
Bonus Money was the prize money given by the Board and the said prize money was exempted from tax. It is also not in disputed that the issue with regard to match fee was covered by CBDT Circular No. 1432 dated 26.11.87 wherein guidelines for the treatment of tour money received by cricket player had been laid down by CBDT. It was withdrawn by circular dated 22.09.1998 but this could not have been applied retrospectively.
Both these issued came up for consideration before CIT (A) Patiala during the course of assessment proceedings and the CIT (A) Patiala vide order dated 2.6.1999 had already adjudicated this issued in favour of the assessee. Further it has been noticed in the judgment that similar issue had been considered in the case of Dr. (Smt.) Navjot Kaur Sidhu w/o the assessee for the block period 01.04.1990 to 20.07.2000, vide order dated 30.08.2005 and keeping in view this fact, the appeal of the department was dismissed.
No substantial question of law arises for consideration in the present appeal.
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2023 (1) TMI 1327
Scope of Prohibition of Benami Property Transactions Act, 1988 as amended by the Benami Transactions (Prohibition) Amendment Act, 2016 - whether has a prospective effect? - As decided in M/S. GANPATI DEALCOM PVT. LTD.[2022 (8) TMI 1047 - SUPREME COURT] Section 3(2) of the unamended 1988 Act is declared as unconstitutional for being manifestly arbitrary. Accordingly, Section 3(2) of the 2016 Act is also unconstitutional as it is violative of Article 20(1) of the Constitution. In rem forfeiture provision under Section 5 of the unamended Act of 1988, prior to the 2016 Amendment Act, was unconstitutional for being manifestly arbitrary. The 2016 Amendment Act was not merely procedural, rather, prescribed substantive provisions.In rem forfeiture provision under Section 5 of the 2016 Act, being punitive in nature, can only be applied prospectively and not retroactively.Concerned authorities cannot initiate or continue criminal prosecution or confiscation proceedings for transactions entered into prior to the coming into force of the 2016 Act, viz., 25.10.2016. As a consequence of the above declaration, all such prosecutions or confiscation proceedings shall stand quashed.
HELD THAT:- UPON perusing papers the Court made the following
Delay condoned.Application for oral hearing of the review petition is allowed.
List the review petition for open Court hearing on 15 March 2023 at 3.30 pm.
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