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Showing 121 to 140 of 2067 Records
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2017 (11) TMI 1950
Violation of principles of natural justice - mismatch between the purchases effected and Annexure of the other end dealer - HELD THAT:- Similar cases were dealt with by this Court and a decision has been taken in the case of M/S. JKM GRAPHICS SOLUTIONS PRIVATE LIMITED VERSUS THE COMMERCIAL TAX OFFICER [2017 (3) TMI 536 - MADRAS HIGH COURT]. In the said decision, this Court indicated certain guidelines as to how the assessment should have proceeded in cases where the revision is based on details culled out upon verification of the Departmental website. Therefore, the second respondent, being a new officer, should have afforded an opportunity to the petitioner especially when the revision notices were issued in the year 2015. Thus, this Court is unable to approve the manner, in which, the impugned assessments have been completed.
The matters are remitted back to the second respondent for a fresh consideration. The second respondent shall direct the petitioner to appear before her and furnish all details as sought for by them, after which, the petitioner should be given a reasonable time to submit further objections - Appeal allowed by way of remand.
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2017 (11) TMI 1949
CENVAT credit - inputs/capital goods/input services - appellant used generated electricity for its own captive consumption as well as sold electricity to the Grid as per the contractual norms - common input for taxable as well as exempt goods - denial of credit only on the ground that Cenvat Credit statute specifically permits utilization of electricity for manufacture of the final product - Rule 3, 6 (5) and Rule 9 of Cenvat Credit Rules, 2004 - HELD THAT:- The appellant had reflected the percentage of electricity consumed within the factory and that wheeled out to Grid against receipt of monetary consideration. However, since such certificate was produced by the appellant after adjudication of the matter, the original authority should verify the certificate alongwith the statement produced before the Tribunal, for ascertaining the fact, whether the percentage of generated electricity reflected in the statement were actually sold to the Grid.
For arriving at the conclusion regarding captive consumption of generated electricity and that sold out to grid, the appellant should produce adequate records to demonstrate such factual aspects - On verification of the documents, if the original authority is satisfied that the quantum of electricity generated were captively used by the appellant for manufacture of the final product, the Cenvat benefit on such quantum of electricity should be made available to the appellant.
Appeal allowed by way of remand.
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2017 (11) TMI 1948
Deduction u/s.54 in respect of construction of a residential house - claim denied on the ground that the construction has not been completed till the date of assessment - action of the Ld. CIT(A) in holding that the Cost Inflation Index is to be applied from 01.04.1981 - HELD THAT:- The property was originally owned by the assessee’s grand-mother and in view of the provisions of Explanation-1(i)(b) to Sec.2(42A) has held that in determining the period for which any asset is held by assessee under a gift, the period for which the asset was held by the previous owner has to be included. The Revenue has not been able to dislodge the findings nor has any other decision on this issue been placed before us. This being so, as it is noticed that the Ld. CIT(A) has followed the decision of the Hon’ble Bombay High Court in the case of Manjula J. Shah [2011 (10) TMI 406 - BOMBAY HIGH COURT] we find no reason to interfere in the order of the Ld. CIT(A) on this issue.
Construction of the residential house - A perusal of the capital gains account in the assessee’s case with SBI shows that the first entry is of 27.07.2012 wherein there was a deposit of ₹ 25,000/- and then there are various other deposits. On 15.03.2013, there is a withdrawal of ₹ 90,12,733/- and subsequently another withdrawal of ₹ 5,01,500/- on 21.04.2014. A perusal of the order of the Ld.CIT(A) at Para No. 12 talks of deposits in Capital Gains Scheme Account of ₹ 95,30,000/-. However, the bank account mentioned in the said paragraphs completely varies. Further, as per the Paper Book, the capital gains account with SBI is shown as 32449616206. How the Ld.CIT(A) has treated the other bank accounts as capital gains account is unknown? The said capital gains account has shown in the Paper Book shows total deposit of nearly ₹ 96,21,714/-. How the Ld. CIT(A) has arrived at the figure of ₹ 95,30,000/- is also not coming out of any evidences? The Ld.AR has not been able to place before us any evidence to show that the residential house had been constructed. The Ld.AR was unable to explain, if the Completion Certificate was received on April 16, 2015, why the same had not been produced before the Ld. CIT (A)? However, no reply was given. Further, a perusal of the capital gains account, only two withdrawals one is ₹ 90,12,733/- and another is ₹ 5,01,500/-. How this amount was withdrawn, on the basis of what invoice is also not produced before us. This being so, as the assessee has not been able to produce any evidence to substantiate the construction of the residential house, the order of the Ld. CIT (A) on this issue is reversed and that of the AO restored.
CIT (A) granting the relief to the assessee u/s. 80E - submission that the Ld. CIT (A) has entertained the fresh evidence in the form of the letter issued from SBI regarding the deposit of sum towards the educational loan account of Shri Guarav Syal and Shri Rajan Syal and the said evidence was not produced before the AO - HELD THAT:- As the said evidence has not been produced before the AO for examination, in the interest of natural justice, the issue in respect of the deduction u/s.80E is restored to the file of the AO for re-adjudication after granting adequate opportunity to the assessee of being heard.
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2017 (11) TMI 1947
Reasonable cause for non-representation on the date of hearing - Reopening of assessment u/s 147 - HELD THAT:- Notice of hearing was sent to the assessee on 11/10/2017 fixing the date of hearing on 13/11/2017 at the address indicated in column No. 10. Despite this, the assessee remained unrepresented. In the aforementioned peculiar facts and circumstances of the case, in the absence of any representation on behalf of the assessee or petition seeking time, it can be safely presumed that the assessee is not serious in pursuing the appeal filed. Accordingly the only alternative left is to dismiss the appeal of the assessee in limine. Support is drawn from the order of the Tribunals in Commissioner of Income Tax vs. Multi Plan India (P) Ltd.; [1991 (5) TMI 120 - ITAT DELHI-D] and Estate of Late Tukojirao Holka [1996 (3) TMI 92 - MADHYA PRADESH HIGH COURT]
Before parting, it is appropriate to add that in case the assessee is able to show that there was a reasonable cause for non-representation on the date of hearing, it would be at liberty if so advised to pray for a recall of this order. Appeals of the Assessee are dismissed.
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2017 (11) TMI 1946
Rectification u/s 254 - Allowability of the interest on borrowed funds - investment in shares of subsidiary company - interest expenditure allowability u/s.36(1)(iii) - Tribunal considered the issue and gave findings [2016 (10) TMI 807 - ITAT HENNAI] as restored the matter to the file of ld. Assessing Officer for fresh consideration with certain directions - Tribunal on earlier occasion in its order, has given direction to ld. Assessing Officer to allow the expenditure u/s.36(1)(iii) of the Act, if the investment was made in subsidiary company for the purpose of acquiring controlling interest and acquisition of such controlling interest was of the business of the assessee - HELD THAT:- Decision of the Tribunal is binding on the AO and he cannot pick up a words or sentences from the Order of Tribunal, de hors the context or questions under consideration and construe it to be complete law declared by the Tribunal. When once the Tribunal decides the issue in one way, only course available to the AO is to follow the Order of Tribunal in full spirits, and it is not permissible to the AO to take a different view, or to sit in judgment over the Order of Tribunal by interpreting the same in the manner he wanted.
The Tribunal on earlier occasion in its order, has given direction to ld. Assessing Officer to allow the expenditure u/s.36(1)(iii) of the Act, if the investment was made in subsidiary company for the purpose of acquiring controlling interest and acquisition of such controlling interest was of the business of the assessee and if it resulted in promote the business of the assessee as well as helpful to the assessee for having management control over said such subsidiary company, then the duty of the AO is to grant deduction u/s.36(1)(iii) of the Act, if it is fulfilled the condition laid down by the Tribunal.
If the money was borrowed for the purpose of purchase of shares of subsidiary company, which is for the purpose of acquiring or maintaining controlling interest and acquisition/maintaining of such controlling interest was of the business of the assessee and if it is resulted in promotion of the business of assessee company as well as helpful to the assessee for having management control over such subsidiary company, then such interest expenditure should be allowed u/s.36(1)(iii) of the Act.
If AO fails to properly understand or appreciate the direction to the Tribunal, then the assessee is at liberty to explore and pursue the remedies available under law at elsewhere, as the AO is duty bound to pass the consequential order in conformity with the Order of Tribunal cited supra and he has no discretion or choice or to overlook the Order of Tribunal. In the present case, the assessee has not pointed out any mistake in the Order of Tribunal cited supra which warrants rectification in terms of Sec.254(2) of the Act. In absence of any specific mistake which warrants any rectification within the scope of provisions of the section 254(2) of the Act, in the Order of Tribunal cited supra, there is no reason to recall the earlier Order of Tribunal, or to delete any part therein.
The decision of Tribunal has not to be scrutinized sentence by sentence to find out whether all facts have been set out in detail by the Tribunal or whether some incidental fact, which appears on the record, has not been noticed by the Tribunal in its order, if the order of the Tribunal shows that it has, in fact, done so, there is no reason to interfere with the decision of the Tribunal vide provision of the section 254(2) of the Act and we make it clear that the AO shall pass the order in conformity with the Order of Tribunal. With this observation, we dispose off the Miscellaneous Petitions filed by the assessee.
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2017 (11) TMI 1945
Transfer of the proceedings from the Hon'ble High Court to the Adjudicating Authority - notice for such transfer issued or not - HELD THAT?:- Admittedly, no notice was issued under sub-section (1) of Section 8 of the 'I & B Code'. In terms with Rule 5, other informations were also not placed before the Adjudicating Authority.
The Respondent having failed to provide all the details as required under Form-5 as noticed above, the application under sections 433 and 434 of the Companies Act, 1956 cannot be treated to be an application under section 9 of the 'I & B Code' in terms of Rule 5 of Transfer Rules, 2016. In such circumstances, in view of proviso to Rule 5 of the Transfer Rules, the application under Sections 433 and 434 of the Companies Act, 1956 stands abated.
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2017 (11) TMI 1944
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - service of notice - HELD THAT:- Accrual of interest during a short period of a month or two will exceed 39 lacs. The claim of interest cannot therefore accrue solely from the three invoices, in question, as claimed in the application (Form-5). That apart there is no document to show that the six debit notes unilaterally sent by the applicant towards interest were acknowledged by the respondent. Respondent has disputed the claim inter alia with the contention that no ledger account was filed along with original application nor there was any material to demonstrate the previous transactions nor were there any agreement and/or understanding in support of payment of interest. In this scenario the amount of interest, as specifically claimed in the application (Form-5), is not free from dispute.
It is also pertinent to mention here that respondent company has filed relevant ledger accounts revealing previous transactions between the parties, which were not disclosed by the applicant at the first instance. It is seen from the reply and rejoinder that there had been business transactions between the parties comprised of reciprocal demands on account of sales and purchases made inter-se, since the year 2010. Litigants must observe total clarity and candour in their pleadings as wheels of justice can move only on true facts. However the applicant has initiated the application without full disclosure of facts at the first instance - In view of the aforementioned particulars the claim of reciprocal transactions on account of sales and purchases made inter-se, between the parties cannot be overlooked. Accordingly, the dispute raised by the Respondent on the claim of principle amount and interest cannot be termed as sham and illusory.
Admittedly there has been no admission of the claimed operational debt by the respondent. On the contrary there has been a counter-claim by the respondent. It is further seen that there has been reciprocal transactions between the parties long since the year 2010 and dispute certainly exists in the facts of the case much prior to the issuance of notice under Section 8 of the Code. The claim of dispute suggests the need of elaborate investigation. It is reiterated that existence of dispute in the present case cannot be ruled out. The respondent has raised dispute with sufficient particulars. Hence, the amount of claim raised by the applicant clearly falls within the ambit of disputed claim.
Application dismissed.
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2017 (11) TMI 1943
Long tern capital gain - applicability of section 50C - Computation of full value of consideration for transfer of asset - HELD THAT:- Issue in appeal is squarely covered by the Tribunal’s decision in the case of Dharamshibhai Sonani [2016 (9) TMI 1259 - ITAT AHMEDABAD], which has been subsequently followed by large number of division bench of this Tribunal. As rightly held by the Tribunal in the case of Dharamshibhai Sonani (supra), the amendment brought about by Finance Act, 2016, providing that “where the date of the agreement fixing the amount of consideration and the date of registration for the transfer of the capital asset are not the same, the value adopted or assessed or assessable by the stamp valuation authority on the date of agreement may be taken for the purposes of computing full value of consideration for such transfer”, is retrospective in effect and applies from 1st April 2003. The detailed reasons for coming to this conclusion are already set out in the extract from the Tribunal’s decision quoted earlier in this order.
We are of the considered view that the plea of the learned counsel indeed merits acceptance. We, therefore, deem it fit and proper to remit the issue to the file of the Assessing Officer for adjudication de novo in the light of observations above and the legal position set out in Dharamshibhai Sonani (supra) . Thus we remit the matter to the file of the Assessing Officer in this case as well. Assessee appeal is allowed for statistical purposes.
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2017 (11) TMI 1942
Disallowance of interest expenditure made u/s.14A - sufficiency of own funds - HELD THAT:- As own funds available with the assessee is in excess value of mutual funds held by the assessee. Other investments made by the assessee consisted of fixed deposits made with the Bank and investment made in shares of Cooperative Bank, income from both of which is not exempt. Since own funds available with the assessee is in far excess of value of investment made in mutual funds, there is merit in the contentions of the assessee that the disallowance of interest expenditure is not called for, in view of the decision of HDFC Bank Ltd. [2016 (3) TMI 755 - BOMBAY HIGH COURT]. Accordingly, we set aside the order passed by the learned CIT(A) on this issue in all five years and direct the Assessing Officer to delete the disallowance of interest expenditure made u/s. 14A of the Act. For assessment year 2011-12, the AO is directed to compute the disallowance under Rule 8D(2)(iii) by adopting correct figures.
Deemed dividend addition u/s. 2(22)(e) - AO noticed that the partners of the assessee-concern are also directors in a closely held company and the assessee company has borrowed funds from the above said closely held company - HELD THAT:-Hon'ble Supreme Court has since decided identical issue in the case of CIT Vs. Madhur Housing and Development Company [2017 (10) TMI 1279 - SUPREME COURT] has held that addition of deemed dividend u/s. 2(22)(e) of the Act can be made only in the hands of shareholders, meaning thereby, the decision rendered by Hon’ble Bombay high Court in the case of Impact containers P Ltd [2014 (9) TMI 88 - BOMBAY HIGH COURT] has been upheld by Hon’ble Supreme Court. Since the assessee is not a share holder of M/s Shirdi Chemicals P Ltd, the assessing officer was not right in law in invoking the provisions of sec. 2(22)(e) of the Act in its hands. - Decided against revenue.
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2017 (11) TMI 1941
Estimation of income - Bogus purchases - CIT(A) applying 12.50% of the purchases as profit embedded on the purchase - HELD THAT:- The sale is not disputed. The assessee might have purchased the said material from the grey market to avoid the Sales Tax, VAT and Excise etc. The profit embedded in the said purchase has been taken into consideration to the extent of 12.5% in addition to the regular profit offered to tax.
CIT(A) has also considered the number of cases while deciding the matter of controversy but the yardstick taken into consideration by the CIT(A) in the case of of CIT Vs. Simit Sheth [2013 (10) TMI 1028 - GUJARAT HIGH COURT] the percentage of profit embedded into the purchase to the extent of 12.5% has rightly been taken into consideration to the facts and circumstances of the case. Accordingly, we are of the view that the CIT(A) has decided the matter of controversy judiciously and correctly which is not required to interfere with at this appellate stage. Accordingly, this issue is decided in favour of the revenue against the assessee.
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2017 (11) TMI 1940
Long Term Capital Loss carried forward - transaction is covered with purview of provision of section 10(38) - HELD THAT:- We notice that the Ld. CIT (A) has decided the issue in favour of the assessee relying on the decision of the Co-ordinate Bench of the ITAT rendered in the case of Raptakos Becott & Company Ltd. vs. DCIT [2015 (6) TMI 529 - ITAT MUMBAI] In Kishorebhai Bhikhabhai Virani Vs. ACIT [2015 (2) TMI 807 - GUJARAT HIGH COURT] the Hon’ble Gujarat High Court has decided the identical issue against the assessee and dismissed the appeal of the assessee wherein held contention of the learned counsel for the assessee that for the purpose of section 10(38) of the Act term “income” would not include “loss” cannot be accepted and rightly rejected by the Tribunal. If this is available for set off the Tribunal rightly relied on the decision in the case of Harprashad & Co. (P.) Ltd. [1975 (2) TMI 2 - SUPREME COURT] to come to a conclusion that the term “income” under section 10(38) of the Act would also include the loss. In the said decision, the apex court observed that the concept of carry forward of loss does not stand in vacuo. It involves the notion of set off it postulates permissibility and possibility of the carried forward loss being absorbed or set off against the profits and gains profit to reduce the tax demand. It was held that if such set off is not permissible or possible owing to the income or profits of the subsequent year being from a non-taxable source, there would be no point in allowing loss to be “carried forward”. Conversely, if the loss arising in the previous year was under a head not chargeable to tax, it could not be allowed to be carried forward and absorbed against income in a subsequent year, from a taxable source. - Decided against assessee.
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2017 (11) TMI 1939
Penalty u/s 271(1)(c) - furnishing of inaccurate particulars of income by the assessee with regard to computation of book profit under section 115JB - non-inclusion of long term capital gain from sale of equity shares while computing the books profit under section 115JB - HELD THAT:- A perusal of the return of income filed by assessee for the impugned assessment year,nd computation of income accompanying such return clearly indicate that the assessee has disclosed full particulars relating sale of equity shares and the long term capital gain derived therefrom - a perusal of the assessment order also reveals that the information relating to earning of long term capital gain from sale of equity shares by the assessee and non-inclusion of the same for computing book profit under section 115JB came to the notice of the Assessing Officer from the statement of total income filed by the assessee along with the return of income and not from any other source.
Thus,assessee has furnished full particulars of the income derived from sale of equity shares. Though, it may be a fact that long term capital gain from sale of shares is not exempt for computing book profit under section 115JB, however, such exemption claimed by the assessee appears to be for the reason that assessee was under a bona fide belief that, since, long term capital gain as per section 10(38) is exempt from taxation under the normal provisions of the Act, the same would also apply for computing book profit.
The explanation of the assessee that non-inclusion of long term capital gain for computing book profit was due to bona fide reasons cannot be brushed aside lightly. In any case of the matter, the factual matrix clearly reveals that the assessee has made full disclosure of facts relating to earning of long term capital gain from sale of equity shares in the return of income as well as in the computation of income. Non-inclusion of long term capital gains by computing book profit under section 115JB , in our view, is a mere computational error due to a bona fide belief entertained by the assessee that such income is exempt from taxation. That being the case, the ratio laid down by in the case of Pricewaterhouse Cooper Pvt. Ltd. [2012 (9) TMI 775 - SUPREME COURT] will clearly apply to the facts of assessee’s case.
Thus assessee’s explanation that it excluded long term capital gain from sale of equity shares while computing book profit under section 115JB entertaining a belief that it is also exempt from taxation, appears to be plausible. Therefore, in our considered opinion, the assessee cannot be charged with the offence of furnishing inaccurate particulars of income so as to levy penalty under section 271(1)(c) - Decided in favour of assessee.
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2017 (11) TMI 1938
Interpretation of statute - whether the provision of Section 24(1)(b) of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 is governed by the proviso to Sub-section (2) of Section 24 of the said Act or it has to be read as part of section 24(2)?
HELD THAT:- It is only occasionally that proviso is unrelated to subject matter of preceding section, it may have to be interpreted as a substantive provision. Ordinarily, a proviso is not interpreted as stating a general rule. Provisos are often added as saving clauses. A proviso must be construed with reference to the preceding parts of the clause to which it is appended. The proviso is ordinarily subordinate to the main section. A construction placed on proviso which brings general harmony to the terms of the section should prevail. A proviso may sometime contain substantive provision. Ordinarily, proviso to a section is intended to take out a part of the main section for special treatment. Normally, a proviso does not travel beyond the main provision to which it is a proviso. A proviso is not interpreted as stating a general rule, it is an exception to main provision to which it is carved out as a proviso. Proviso can not be construed as enlarging the scope of enactment when it can be fairly and properly constructed without attributing that effect. It is not open to read in the words of enactment which are not to be found there and which would alter its operative effect.
It is apparent from the provisions of Section 24(1), that it contains a non-obstante clause with respect to any provision made in the Act of 2013 - It is also provided in Section 24(1)(b) that in case any land acquisition proceedings had been initiated under the Act of 1894 and, an Award under Section 11 has been made, such proceedings shall continue under the provisions of the Act of 1894, as if the said Act had not been repealed.
In DELHI DEVELOPMENT AUTHORITY VERSUS SUKHBIR SINGH AND ORS. [2016 (9) TMI 1586 - SUPREME COURT], this Court has observed that Section 24(1) begins with a nonobstante clause, and thereafter, in the aforesaid paragraph 12, it has been observed that in respect of Section 24(1)(b), an important exception is carved out by Section 24(2). This Court nowhere held in said decision that the proviso to Section 24(2) is to be read as part of Section 24(1)(b), as was tried to be suggested. Through the non obstante clause in the opening part, exception has been carved out in Section 24(2) to section 24(1), proviso remains part of section 24(2) only. There is no dispute with proposition that exception had been carved out in section 24(2) of the Act of 2013. Whereas, the issue involved in the present case is different. The issue involved in the instant case is, whether the proviso is to be read as a part of Section 24(1)(b) or as a part of Section 24(2) as per settled principles of construction a proviso except out preceding portion of enactment to which it is appended. The same is appended to section 24(2) not to section 24(1)(b) under the Act of 2013. In our opinion, it was neither question raised in Sukhbir Singh, nor has it been answered. Thus, that decision, in our view, is of no value, to assist the cause of the respondents.
The proviso to Section 24(2) is not applicable in the instant case, same is applicable where the Award had been passed 5 years before. In a case where Award has been passed within 5 years, the said proviso of section 24(2) cannot be said to be applicable. The submission made on the basis of the proviso cannot be said to be sustainable.
The decision of the High Court cannot be said to be sustainable, and the same is hereby set aside - Appeal allowed.
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2017 (11) TMI 1937
Grant of Bail - Murder - trial court granted bail to Anil Kumar Yadav (A4) vide order dated 27.02.2017, inter alia, on the grounds:-(i) that no other overt act had been attributed to Anil Kumar Yadav (A4); (ii) Based on CCTV footage, in drawing an inference that no specific role had been assigned to Anil Kumar Yadav (A4); and (iii) that Anil Kumar Yadav (A4) had been in custody for about sixteen months which was assailed before High Court - HELD THAT:- In the present case, the trial is at a very crucial stage. The trial court is yet to record the testimony of material witnesses including the complainant as well as all the material witnesses. The trial has commenced and the trial is said to be posted for 04.12.2017. For ensuring the fair trial, witnesses must be in a position to freely depose without fear. In the facts and circumstances of the case, we are convinced that a fair trial can be ensured only if the Appellants are not enlarged on bail.
We are conscious of the fact that the Appellants are only under trials and their liberty is also a relevant consideration. But equally important is to consider the impact of their release on bail on the prosecution witnesses and also its impact on society. In order to ensure that during trial the material witnesses depose without fear and justice being done to the society, a balance has to be struck.
It was repeatedly urged that the High Court misdirected itself in interfering with the discretionary order of Sessions Court granting bail to the Accused and there was absolutely nothing to show that the Appellants are likely to abuse the bail or tamper with evidence. The court while granting bail should exercise its discretion in a judicious manner. Of course, once discretion is exercised by the Sessions Court to grant bail on consideration of relevant materials, the High Court would not normally interfere with such discretion, unless the same suffers from serious infirmities or perversity. While considering the correctness of the order granting bail, the approach should be whether the order granting bail to the Accused is vitiated by any serious infirmity, in which case, the High Court can certainly interfere with the exercise of discretion. The materials available on record prima facie indicating the involvement of the Accused, possibility of Accused tampering with witnesses and the gravity of the crime were not kept in view by the Sessions Court. Since the Sessions Court granted bail to the Appellants on irrelevant considerations and the same suffered from serious infirmity, the High Court rightly set aside the order of grant of bail to the Accused. The impugned orders do not suffer from any infirmity warranting interference.
Appeal dismissed.
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2017 (11) TMI 1936
Exemption u/s 11 - Denial of exemption as franchisee fees received by the DPS Society from different satellite schools which are running under the name and logo of Delhi Public School having different management that the DPS Society - HELD THAT:- It is seen from various orders placed in the paper book for the various assessment years in assessee’s own case, passed by this Tribunal that, this issue now stands settled in favour of assessee and against revenue. It is also observed that Ld.CIT (A) followed the binding decision of this Tribunal in assessee’s own case for the previous assessment years. In view of the above we do not find any infirmity in the order passed by Ld. CIT (A) and the ground raised by revenue stands dismissed
Deduction on account of depreciation denied - AO was of the opinion that assessee was a trust and it was deriving income from depreciable assets and held that depreciation could not be taken into account because full capital expenditure has been allowed in the year of acquisition of the assets - HELD THAT:- As relying in own case[2012 (10) TMI 786 - ITAT, DELHI] and case of Indraprastha Cancer Society, Abul Kalam Azad Islamic Awakening [2014 (11) TMI 733 - DELHI HIGH COURT] By Finance (No. 2) Act of 2014, sub-section (6) to Section 11 stands inserted with effect from 1st April, 2015 to the effect that where any income is required to be applied, accumulated or set apart for application, then for such purposes the income shall be determined without any deduction or allowance by way of depreciation or otherwise in respect of an asset, the acquisition of which has been claimed as application of income under this Section in the same or any other previous year. The legal position, therefore, would undergo a change in terms of Section 11(6), which has been inserted and applicable with effect from 1st April, 2015 and not to the assessment years in question. The newly enacted sub-section relates to application of income
Set off of loss and carry forward of claim for excess application for the year - HELD THAT:- As decided in own case [2012 (10) TMI 786 - ITAT, DELHI] adjustment of the expenses incurred by the trust for charitable and religious purposes in the earlier year against the income earned by the trust in the subsequent year would amount to applying the income of the trust for charitable and religious purposes in the subsequent year in which such adjustment has been made and will have to be excluded from the income of the trust u/s 11(1)(a) - decided in favour of assessee.
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2017 (11) TMI 1935
Penalty u/s. 271(1)(c) - change in head of income - HELD THAT:- There is no change in the loss figures offered by the assessee in the return of income. The assessee offered the loss under the head capital gains which, in the opinion of Ld. AO, was assessable under the head business income - basic condition viz. furnishing of inaccurate particulars / concealment of particulars of income so as to attract the provisions of Section 271(1)(c) have remained unfulfilled in the present case. Therefore, penalty was not justified and the stand of Ld. CIT(A) was quite fair & logical and hence, the same do not require any interference on our part. Revenue’s appeal stands dismissed.
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2017 (11) TMI 1934
Undisclosed investment - mismatch between gross turn-over declared by assessee vis-avis gross receipt appearing in the bank statement of the assessee - assessee tried to reconcile the statement as observed by AO explaining that certain receipts in the bank statements are showing the money receipt on the realization of mutual fund as well as maturity value of fixed deposit - CIT(A) reversed the order of AO after giving part relief to assessee by observing the fact that the investment in mutual fund / fixed deposit are coming from the earlier year - HELD THAT:- CIT(A) in his appellate order has admitted the fact that AO has not examined both debit and credit side of the bank account. But Ld. CIT(A) has also not commented on all the debit and credit side of the bank statement of the assessee.
Also observed by Ld. CIT(A) in his appellate order that Assessing Officer failed to put any effort in his assessment order as well at the stage of remand report. But in this case, also we find that Ld. CIT(A) has also not exercised his power to figure out the unaccounted receipt.The requisition made by the Ld. CIT(A) during remand report has not been recorded in the order of Ld. CIT(A).
The provision of Section 250(6) of the Act require the commissioner appeal to dispose of the appeal in writing and with reasoning but we find from the appellate order that where he has given relief to assessee merely relying on the submissions made by assessee. We also note that lot of information were submitted by assessee before Authorities Below which has not been duly verified.
Therefore we are inclined to restore the matter back to the file of AO for fresh adjudication in accordance with law. The AO must give reasonable opportunity to the assessee before passing order on this point. Accordingly, Revenue’s issue is allowed for statistical purpose.
Reopening of assessment - whether CIT(A) erred in not issuing direction to the AO u/s 150(1) to reopen the assessment for those years in which the investment had been made by the assessee - HELD THAT:- Respectfully following the judgment in the case of Murlidhar Bhaghubabu [1964 (1) TMI 5 - SUPREME COURT] we conclude that Ld. CIT(A) has no power under the provision of law for giving any direction to AO for reopening of assessment. The appeal before Ld. CIT(A) is confined to the particular assessment year which is before him. Thus, in view of the above proposition, we dismiss the ground of Revenue’s appeal. Consequently, Revenue’s ground is dismissed.
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2017 (11) TMI 1933
Denial of claim of deduction u/s 10AA - assessee has earned excess profits from the units eligible for deduction u/s 10AA by invoking the provisions of Sec.80IA(10) - HELD THAT:- AO shall have to examine the fulfillment of the 3 conditions namely, “close connection”, “arrangement” and “more than ordinary profits” in the course of business while examining assessee’s claim of deduction u/s 10AA of the Act and satisfaction of all the aforesaid 3 conditions are mandatory before invocation of Sec.80IB(10) of the Act. In the present case, the close connection between the assessee and its A.Es is an undisputed fact. However no material has been brought on record to indicate that the course of business was so arranged so as to inflate the profit so as to indicate the inflation of profits with the intention of abusing tax concessions u/s 10AA of the Act. We further find that AO has proceeded on the basis of presumptions to conclude that there is inflation of profits.
As relying on COGNIZANT TECHNOLOGY SOLUTIONS INDIA PVT. LTD.[2017 (10) TMI 1554 - ITAT PUNE] after relying on M/S HONEYWELL AUTOMATION INDIA LIMITED [2015 (3) TMI 494 - ITAT PUNE] held AO was not justified in working out the excess profit on the basis of presumptions and reducing the claim of deduction of assessee u/s 10AA of the Act. We therefore set aside the action of the AO. Thus, the ground of the assessee is allowed and the Revenue is dismissed.
Deduction u/s 10AA allowed before setting off brought forward losses and unabsorbed depreciation and the deduction u/s 10AA should be granted from the profits for the year of the eligible unit of the assessee - We find that identical issue of the setting off of brought forward of losses and unabsorbed depreciation was before the Co-ordinate Bench of the Tribunal in assessee’s own case in A.Y. 2007-08 [2016 (5) TMI 107 - ITAT PUNE].
In view of the aforesaid facts and for the same reasoning and relying on the aforesaid decisions of Co-ordinate Bench of the Tribunal, we are of the view that the deduction u/s 10AA has to be computed in the hands of the assessee before adjusting the brought forward losses and unabsorbed depreciation. Thus, the ground of the assessee is allowed.
Levy of interest u/s 234A and 234B - This ground being consequential in nature requires no adjudication
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2017 (11) TMI 1932
Validity of assessment order passed in violation of Procedure contemplated u/s 144C - HELD THAT:- As procedure contemplated u/s 144C of the Act is violated by the AO, therefore, we are of the confirmed view that the assessment vide order dated 31.03.2014 framed by the AO was null and void ab initio. Since we have decided the legal issue in favour of the assessee therefore, no separate findings are being given for the other issues raised by the assessee on merit.
In view of the annulment of the assessment and setting aside of the impugned order of the Ld.CIT(A), nothing survives for consideration in this appeal as such while respectfully following the same, we dismiss this appeal of the Revenue.
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2017 (11) TMI 1931
TDS u/s 194J - Non deduction of TDS u/s 201(1) - amount paid to Inspectors and Supervisors of the Mid Day Meal programme - HELD THAT:- We find that the amounts have been paid as remuneration to various part time workers based on the number of days worked and the payments ranged from ₹ 38702/- to ₹ 64,000/- to different individuals. These are the payments made to Mid Day Meals Scheme Workers which do not attract Section 194J precisely. On perusal of the above Section 194J the payments made to Mid Day Meal Workers at no stretch of imagination can be treated as fees paid for profession or technical services. Hence the interest levied under section 201(1A) is unwarranted.
TDS u/s 194C - payment to the buses as used in connection with the arrangement for the sports in the school where children are picked and drop after the annual games - HELD THAT:- In this case the buses were used to pick and drop the children for annual games and related activities. It is not a case of entering into a contract for regular use of buses. Since the amounts were minimal and the tax effect is only of ₹ 25,123/-. Further the honorarium paid to counselors under the head wages also do not attract provisions of Section 194C. Keeping in view the peculiar facts and circumstances of this case the addition made is hereby deleted. This deletion cannot be taken as precedence in any other case.
Non deduction of tax on payment made under Mid Day Meal Programme and payments for computer instructors and data entry operators - HELD THAT:- As before us, the assessee submitted that the payments were made to institutions which were registered under section 12A CIT(A) has remanded the matter back to the file of Assessing Officer for verification. Hence we decline to interfere with the order of the Ld. CIT(A) as it’s a matter of verification only at the Assessing Officer’s end.
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