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Showing 121 to 140 of 1054 Records
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2011 (2) TMI 1517
Issues involved: Disallowance of air freight charges to Om Freight and Geo Logistics, disallowance of binding charges, disallowance of clearing charges.
Disallowance of air freight charges: The AO disallowed a total amount including air freight charges u/s 40a(ia) for non-deduction of TDS. The CIT(A) deleted the disallowance, stating that payments made to non-residents on behalf of the assessee are not subject to TDS u/s 194C. The ITAT upheld the CIT(A)'s decision, noting that the freight charges for import of books by foreign vessels are not taxable in India due to lack of permanent establishment.
Disallowance of binding charges: The assessee claimed binding charges, disallowed by the AO for non-deduction of TDS. The CIT(A) upheld the disallowance only on the payment to Star Trader, stating that TDS was not required on other components. The ITAT affirmed the CIT(A)'s decision, limiting the disallowance to the payment made to Star Trader.
Disallowance of clearing charges: The AO disallowed clearing charges u/s 40a(ia) for non-deduction of TDS. The CIT(A) confirmed the disallowance on agency commission but deleted the rest as reimbursement of expenses made on behalf of the assessee. The ITAT upheld the CIT(A)'s decision, similar to the disallowances in other grounds.
In conclusion, the ITAT dismissed the revenue's appeal, upholding the CIT(A)'s decisions on all grounds related to disallowances of various charges due to non-deduction of TDS.
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2011 (2) TMI 1516
The Supreme Court of India dismissed the Special Leave Petition as not pressed. The petitioner can file a writ petition within four weeks, which will be considered on its own merits without considering delay and laches.
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2011 (2) TMI 1515
Issues involved: Validity of reassessment under section 147 and eligibility of deduction under section 80HHC of the Income Tax Act.
Validity of Reassessment under Section 147:
The appeal challenged the validity of reassessment under section 147, questioning whether proceedings can be initiated when the time for issuing notice under section 143(2) has not expired. The notice under section 148 was issued before the time available for issuing notice under section 143(2) had expired. The Tribunal analyzed the procedural aspects and relevant provisions of the Income Tax Act. It was held that reassessment completed pursuant to the notice under section 148 was not valid as the time limit for completing scrutiny assessment had not expired. Citing judgments of the Hon'ble Madras High Court and Tribunal, the Tribunal concluded that the reassessment order passed under section 147 was invalid.
Eligibility of Deduction under Section 80HHC:
The assessee had claimed deductions under sections 80HHC and 10B of the Income Tax Act for different units. The Assessing Officer disallowed the deduction under section 80HHC on the grounds that the income from manufacturing activity was negative and job work income was considered non-manufacturing activity. The assessee contended that profits from job work receipts should be eligible for deduction under section 80HHC. The Tribunal did not adjudicate on the merits of this issue due to the decision on the validity of reassessment in favor of the assessee.
Conclusion:
The Appellate Tribunal, Bangalore, partly allowed the appeal filed by the assessee, holding the reassessment under section 147 as invalid due to procedural irregularities. The issue regarding the eligibility of deduction under section 80HHC was not addressed in detail as the jurisdictional aspect was decided in favor of the assessee.
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2011 (2) TMI 1514
Issues Involved:
1. Disallowance of claims under Section 80-I and 80-IA.
2. Disallowance of reimbursement of interest on housing loans to employees.
3. Disallowance of Diwali and festival expenses.
4. Disallowance of subsidy for gas connections to employees.
5. Disallowance of interest on borrowings for Hazira-Ankleshwar Pipeline Project.
6. Disallowance of provision for doubtful debts.
7. Disallowance of miscellaneous expenses.
8. Disallowance of expenses on replacement of defective meters.
9. Addition on account of alleged sale of defective meters.
10. Disallowance of market survey expenses.
11. Disallowance of depreciation on leased assets.
12. Disallowance of interest on unpaid purchase price of plant and machinery.
13. Disallowance under Section 14A.
14. Disallowance of debit balances written off.
15. Disallowance of bad debts.
16. Disallowance of stores written off.
17. Disallowance of expenditure on gifts and presentations.
18. Disallowance of foreign travel expenses.
Issue-wise Detailed Analysis:
1. Disallowance of claims under Section 80-I and 80-IA:
The Tribunal allowed the assessee's claim for deduction under Sections 80-I and 80-IA, following its own decisions in the assessee's case for earlier years. The Tribunal held that the assessee was engaged in producing decontaminated, odorized, and optimally pressurized gas, which qualifies as manufacturing or producing an article or thing.
2. Disallowance of reimbursement of interest on housing loans to employees:
The Tribunal allowed the assessee's claim for reimbursement of interest on housing loans, following its own decisions in the assessee's case for earlier years. The Tribunal held that the reimbursement was part of the company's HRD policies and akin to allowances/perquisites, thus allowable as business expenditure.
3. Disallowance of Diwali and festival expenses:
The Tribunal allowed the assessee's claim for Diwali and festival expenses, following its own decisions in the assessee's case for earlier years. The Tribunal held that these expenses were incurred for business purposes and maintaining good relations with employees.
4. Disallowance of subsidy for gas connections to employees:
The Tribunal allowed the assessee's claim for subsidy on gas connections, following its own decisions in the assessee's case for earlier years. The Tribunal held that the subsidy was part of the company's HRD policies and akin to allowances/perquisites, thus allowable as business expenditure.
5. Disallowance of interest on borrowings for Hazira-Ankleshwar Pipeline Project:
The Tribunal allowed the assessee's claim for interest on borrowings for the Hazira-Ankleshwar Pipeline Project, following the Supreme Court's decision in the case of Core Health Care Ltd. The Tribunal held that the interest on borrowed capital for the expansion of existing business is allowable under Section 36(1)(iii).
6. Disallowance of provision for doubtful debts:
The Tribunal dismissed the assessee's ground as it was not pressed, the amount not being written off in the year under consideration.
7. Disallowance of miscellaneous expenses:
The Tribunal allowed the assessee's claim for miscellaneous expenses, following its own decisions in the assessee's case for earlier years. The Tribunal held that these expenses were incurred for business purposes and maintaining good relations with employees.
8. Disallowance of expenses on replacement of defective meters:
The Tribunal restored the matter to the AO for re-adjudication, directing the AO to verify the details of removal of old meters, purchase of new meters, fitting of new meters, and sale of scrap.
9. Addition on account of alleged sale of defective meters:
The Tribunal restored the matter to the AO for re-adjudication, directing the AO to verify whether the old meters were actually replaced and sold as scrap.
10. Disallowance of market survey expenses:
The Tribunal restored the matter to the AO for re-adjudication, directing the AO to verify the details and evidence of market survey expenses and determine whether the claim falls under Section 35D.
11. Disallowance of depreciation on leased assets:
The Tribunal allowed the assessee's claim for depreciation on leased assets, following the jurisdictional High Court's decision in the assessee's case for the AY 1995-96 and the Rajasthan High Court's decision in the case of CIT vs. Rajasthan State Electricity Board.
12. Disallowance of interest on unpaid purchase price of plant and machinery:
The Tribunal allowed the assessee's claim for interest on unpaid purchase price of plant and machinery, following its own decision in the assessee's case for the AY 2000-01.
13. Disallowance under Section 14A:
The Tribunal restored the matter to the CIT(A) for re-adjudication, directing the CIT(A) to recompute the disallowance in light of judicial pronouncements, including the Bombay High Court's decision in Godrej & Boyce Mfg. Co. Ltd. vs. DCIT.
14. Disallowance of debit balances written off:
The Tribunal restored the matter to the AO for re-adjudication, directing the AO to allow the assessee to furnish relevant details and evidence in support of their claim for deduction of bad debts.
15. Disallowance of bad debts:
The Tribunal restored the matter to the CIT(A) for re-adjudication, directing the CIT(A) to examine whether the conditions stipulated under Section 36(1)(vii) read with Section 36(2) are fulfilled or if the amount can be allowed as a trading loss.
16. Disallowance of stores written off:
The Tribunal restored the matter to the CIT(A) for re-adjudication, directing the CIT(A) to verify whether a scientific method was followed in writing off the stores.
17. Disallowance of expenditure on gifts and presentations:
The Tribunal upheld the CIT(A)'s decision to allow the claim, finding no material to suggest that the expenditure was incurred for non-business purposes.
18. Disallowance of foreign travel expenses:
The Tribunal upheld the CIT(A)'s decision to allow the claim, finding that the expenditure was incurred for business purposes on an invitation from M/s. B G International.
Conclusion:
The Tribunal's judgment addressed multiple issues, allowing some claims, restoring others for re-adjudication, and providing detailed reasons for its decisions. The judgment emphasizes the importance of providing adequate evidence and following judicial precedents in tax matters.
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2011 (2) TMI 1513
Rectification of mistake - error apparent on the face of record - Whether the application of Article 24 of the Treaty (Limitation of Relief) article, GCC was to be denied the benefit of the Treaty? - payment to GCC was in the nature of Royalty or not? - HELD THAT:- It is found that an error apparent on record has crept into the order of the Tribunal dated 25th June, 2010. The same is rectified by deleting para 21 of the said order and substituting the same with necessary corrections.
The M.A. filed by the assessee is allowed.
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2011 (2) TMI 1512
Issues involved: Appeal against order confirming addition of gift amount and challenge to the reopening of assessment u/s 147 read with section 148 of the I.T. Act, 1961.
Addition of Gift Amount:
The appeal was filed against the order confirming the addition of Rs. 19,40,862 on account of gifts received. The appellant raised various grounds challenging this addition, including the argument that the Commissioner erred in confirming the addition. The details of the gifts received were presented, and the appellant contested the validity of the addition.
Challenge to Reopening of Assessment:
The appellant also contested the reopening of assessment u/s 147 read with section 148 of the I.T. Act, 1961. The appellant's representative argued that the Commissioner inaccurately stated that no arguments were presented regarding the challenge to the reopening of assessment. An affidavit was filed by the appellant's counsel, affirming that detailed arguments were indeed presented during the personal hearing. The appellant requested the order to be set aside for further verification on this issue.
Decision:
After hearing both sides and reviewing the orders and affidavit, it was decided that the impugned order of the Commissioner should be set aside. The Commissioner was directed to verify whether the appellant's counsel did argue the ground challenging the reopening of assessment under section 148. It was emphasized that the Commissioner should adjudicate all grounds of appeal after giving both parties an opportunity to be heard. The appeal of the assessee was treated as allowed for statistical purposes.
Result:
The appeal filed by the assessee was treated as allowed for statistical purposes. The order was pronounced in the Open Court on 22.02.2011.
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2011 (2) TMI 1511
Issues:
1. Whether the assessee is entitled to exemption u/s.11 of the Income Tax Act, 1961?
2. Whether the adjustment of deficit from earlier years to surplus of the current year can be considered as application of income for charitable purpose?
Issue 1:
The Tribunal found that the assessee, a council approved by the Government for promoting jewelry exports, fulfilled the conditions u/s.11(4A) of the Income Tax Act. The Tribunal considered the objects of the council, approval from the Government of India, maintenance of separate accounts, and lack of surplus funds. Citing precedents and the CIT(A)'s findings, the Tribunal concluded that the assessee's activities were incidental to its main object, making it eligible for exemption u/s.11. The High Court, in light of the Apex Court's judgment in Assistant Commissioner of Income Tax v. Thanthi Trust, upheld the Tribunal's decision based on factual findings and separate account maintenance.
Issue 2:
Both parties agreed that the second question was settled against the revenue by a previous decision of the High Court in Commissioner of Income Tax v. Institute of Banking. Consequently, the Court found no merit in the appeal and dismissed it without costs.
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2011 (2) TMI 1510
Issues Involved:
1. Determination of seniority between two groups of direct recruits to the posts of Deputy Jailor.
2. Application and interpretation of the Uttar Pradesh Government Servants Seniority Rules, 1991 (1991 Rules).
3. Conflict between the 1991 Rules and the Uttar Pradesh Jail Executive Subordinate (Non-Gazetted) Service Rules, 1980 (1980 Rules).
4. Validity of the High Court's decision regarding seniority.
5. Applicability of alternative remedies before the State Service Tribunal.
Detailed Analysis:
1. Determination of Seniority Between Two Groups of Direct Recruits:
The core issue was the determination of seniority between two groups of direct recruits to the posts of Deputy Jailor, one appointed in 1991 through the Uttar Pradesh Subordinate Services Selection Commission and the other in 1994 by the Uttar Pradesh Public Service Commission (UPPSC). The seniority dispute arose due to the different timelines of their recruitment processes.
2. Application and Interpretation of the 1991 Rules:
The 1991 Rules, framed under the proviso to Article 309 of the Constitution, were applicable to all government servants in Uttar Pradesh. Rule 5 of the 1991 Rules was initially considered by the High Court, which held that the seniority should be determined based on the commencement of the selection process. However, the Supreme Court found that Rule 5 was not applicable because it pertains to appointments made only by direct recruitment, while the 1980 Rules provide for recruitment by both direct recruitment and promotion.
3. Conflict Between the 1991 Rules and the 1980 Rules:
The 1980 Rules, which governed the recruitment to the posts of Deputy Jailor, were superseded by the 1991 Rules for the purpose of determining seniority. The Supreme Court held that Rule 8 of the 1991 Rules, which deals with seniority where appointments are made both by promotion and direct recruitment, was applicable. Rule 8 states that seniority should be determined from the date of substantive appointment.
4. Validity of the High Court's Decision:
The High Court had relied on the second proviso to Rule 5 of the 1991 Rules, interpreting that the candidates selected in the earlier selection process (commenced in 1987) should be senior to those selected in the later process (commenced in 1990). The Supreme Court found this interpretation flawed, as Rule 5 was not applicable. Instead, Rule 8 should be applied, which bases seniority on the date of substantive appointment. Consequently, the 1991 appointees, having been substantively appointed earlier, were held to be senior to the 1994 appointees.
5. Applicability of Alternative Remedies:
The Supreme Court did not find it necessary to address the objection regarding the maintainability of the writ petition filed by the contesting private respondent directly before the High Court, bypassing the remedy before the State Service Tribunal, given the resolution of the primary issue on the merits.
Conclusion:
The Supreme Court allowed the appeals, setting aside the High Court's judgment. It held that the seniority of the two groups of direct recruits should be determined based on the date of their substantive appointments as per Rule 8 of the 1991 Rules. The 1991 appointees, having been substantively appointed earlier, were entitled to rank senior to the 1994 appointees. The High Court's reliance on Rule 5 of the 1991 Rules was misplaced, and the correct application of Rule 8 led to the resolution of the seniority dispute in favor of the 1991 appointees.
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2011 (2) TMI 1509
Issues Involved:
1. Deletion of additions on account of working capital advances written off.
2. Treatment of share buyback expenses as revenue expenditure.
3. Treatment of software charges as revenue expenses.
Issue-wise Detailed Analysis:
1. Deletion of Additions on Account of Working Capital Advances Written Off
The department challenged the deletion of Rs. 18,51,98,485 on account of working capital advances written off, arguing that these were neither working capital nor advances. The assessee had given advances to two sister concerns, JBMFPL and MFPL, which were contract biscuit manufacturers. The assessee claimed these advances as business losses due to irrecoverability. The A.O. disallowed the claim, considering these as capital expenditure since the advances were used for loans and investments, not for day-to-day operations. The A.O. also argued that the loss was not real due to the close connection between the entities and the lack of recovery efforts.
The ld. C.I.T.(A) deleted the disallowance, stating that the advances were trading advances, not loans, and were written off due to subvention agreements executed in March 2004. The financial statements of the debtor companies supported the write-off. The ld. C.I.T.(A) concluded that the write-off was a business loss, necessary for the assessee's economic interest, and allowed the deduction.
The Tribunal upheld the ld. C.I.T.(A)'s decision, agreeing that the advances were given for business expediency to ensure continued supply of biscuits and were written off due to the financial incapacity of the debtor companies. The Tribunal referenced the Hon'ble Apex Court's decision in S.A. Builders vs. C.I.T., emphasizing that commercial expediency includes such expenditures as a prudent businessman incurs for the purpose of business.
2. Treatment of Share Buyback Expenses as Revenue Expenditure
The department contested the treatment of share buyback expenses as revenue expenditure. The Tribunal noted that this issue was covered by its earlier decision in the assessee's case for assessment year 2003-04, where it was held that the expenditure on share buyback was revenue in nature. The Tribunal, following its previous decision, upheld the ld. C.I.T.(A)'s order, confirming the deletion of the disallowance of Rs. 11,42,963/-.
3. Treatment of Software Charges as Revenue Expenses
The department argued that software charges should not be considered as revenue expenses. The Tribunal referred to its previous decisions and various judicial pronouncements, including the Hon'ble Supreme Court's decision in Empier Jute Co. Ltd. vs. CIT and the Hon'ble jurisdictional High Court's decision in CIT vs. Health & Co (Calcutta) (P.) Ltd. The Tribunal concluded that software expenses are revenue in nature due to their short life span and the need for frequent updates. The Tribunal upheld the ld. C.I.T.(A)'s order, deleting the disallowance made by the A.O. on this count.
Conclusion
The Tribunal dismissed the Revenue's appeal, upholding the ld. C.I.T.(A)'s decisions on all grounds:
1. Deletion of the disallowance of Rs. 18,51,98,485/- on account of working capital advances written off.
2. Treatment of share buyback expenses as revenue expenditure.
3. Treatment of software charges as revenue expenses.
This order was pronounced in open Court on 11.02.2011.
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2011 (2) TMI 1508
Issues involved: Appeal u/s 260A of the IT Act challenging Tribunal's order on purchase of Rs. 33.13 lacs from non-existent parties.
Summary:
The appellant Revenue challenged the Tribunal's order affirming the CIT(A)'s decision regarding the purchase of Rs. 33.13 lacs from non-existent parties. The senior counsel argued that the appellant Revenue failed to prove the purchase was bogus. However, after reviewing the orders of the AO, CIT(A), and Tribunal, it was found that the CIT(A) and Tribunal had soundly appreciated the evidence. The CIT(A) extensively analyzed the evidence and concluded that the purchases were genuine, as evidenced by the receipt of regular purchase bills, delivery of goods, payment by DDs/cheques, and utilization of raw material in manufacturing. The report of the Dy. Director of IT, Indore, was deemed insufficient to disprove the genuineness of the purchases. The Tribunal also found that the assessee satisfactorily explained the payment modes for the raw material purchased from the concerned parties.
The Tribunal's factual findings were upheld, and no legal question was found to interfere with the decision. Therefore, the appeal was dismissed, affirming the deletion of the addition of Rs. 33,13,706 made by the AO.
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2011 (2) TMI 1507
Issues Involved:
1. Confession to Police Officer as Evidence
2. Mere Membership of a Banned Organization
3. Constitutional Validity of Statutory Provisions
Issue-Wise Detailed Analysis:
Confession to Police Officer as Evidence:
The court noted that the facts of the case were similar to those in Arup Bhuyan vs. State of Assam. The only evidence against the appellant was his alleged confession made to a police officer, which was subsequently retracted and not corroborated by any other material. The court reiterated its stance from Arup Bhuyan's case, stating, "confession is a very weak type of evidence, particularly when alleged to have been made to the police, and it is not safe to convict on its basis unless there is adequate corroborative material." Since no corroborative material was present, the confession alone was deemed insufficient for conviction.
Mere Membership of a Banned Organization:
The appellant was convicted under Section 3(5) of TADA, which criminalizes mere membership of a banned organization. The court referred to its judgment in Arup Bhuyan's case, emphasizing that "mere membership of a banned organization cannot incriminate a person unless he is proved to have resorted to acts of violence or incited people to imminent violence, or does an act intended to create disorder or disturbance of public peace by resort to imminent violence." In the present case, there was no evidence showing that the appellant engaged in such acts. Thus, the court concluded that even if the appellant was a member of ULFA, it had not been proven that he was an active member.
Constitutional Validity of Statutory Provisions:
The court discussed the constitutional validity of statutory provisions that criminalize mere membership of a banned organization, such as Section 3(5) of TADA and Section 10 of the Unlawful Activities (Prevention) Act. It cited various U.S. Supreme Court judgments, including Elfbrandt vs. Russell, which rejected the doctrine of "guilt by association." The court highlighted that these statutory provisions must be read in consonance with the Fundamental Rights guaranteed by the Constitution. The court stated, "The Constitution is the highest law of the land and no statute can violate it." Therefore, to avoid unconstitutionality, the court read down these provisions, asserting that they should only apply to active members who engage in or incite violence.
The court also referred to several precedents where statutes were read down to avoid unconstitutionality, such as Kedar Nath Singh vs. State of Bihar and Sunil Batra vs. Delhi Administration. It emphasized that "every effort should be made by the Court to try to uphold the validity of the statute, as invalidating a statute is a grave step."
Conclusion:
The appeal was allowed, and the impugned judgment was set aside. The court reiterated the importance of corroborative evidence for confessions made to police officers, the distinction between active and passive membership of banned organizations, and the necessity to interpret statutory provisions in a manner that aligns with the Fundamental Rights guaranteed by the Constitution.
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2011 (2) TMI 1506
The High Court of Bombay dismissed the appeal regarding deletion of addition on account of bogus purchases made by the assessee from M/s. Thakkar Agro Industrial Chem Supplies P. Ltd. The Tribunal's decision was upheld as the assessee was not given the opportunity to cross-examine the Director of M/s. Thakkar Agro Industrial Chem Supplies P. Ltd. whose statement was relied upon by the revenue.
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2011 (2) TMI 1505
Issues involved: Challenge to notice u/s 148 of the Income Tax Act, 1961 for reopening assessment for AY 2003-04 beyond four years from the end of the relevant assessment year.
Summary:
The High Court of Bombay heard the challenge to a notice dated 24/03/2010 issued u/s 148 of the Income Tax Act, 1961 seeking to reopen the assessment for AY 2003-04 beyond the prescribed time limit. The reassessment order passed on 7/12/2010 was also challenged during the pendency of the petition.
The reasons recorded for reopening the assessment highlighted the claim of double deduction by the Assessee Trust, which was deemed to be in contravention of the law laid down by the Hon'ble Supreme Court of India. The assessing officer believed there was a failure on the part of the Assessee Trust to make full and true disclosure of material facts, leading to the escapement of income u/s 147 of the Income Tax Act, 1961.
The Court observed that the assessment was sought to be reopened based on the material on record, without any failure on the part of the assessee to disclose all material facts. Referring to the proviso of Section 147, assessments beyond four years can only be reopened in case of such failure. Additionally, both counsels agreed that the question was covered against the revenue by a previous decision of the Court, leading to the quashing of the notice dated 24/03/2010 and the subsequent reassessment order passed on 7/12/2010.
The Court made the rule absolute with no order as to costs, thereby setting aside the notice and the reassessment order.
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2011 (2) TMI 1504
Issues involved: Monitoring of investigation in the 2G Spectrum case, establishment of a separate Special Court for related cases.
Monitoring of Investigation:
The Supreme Court of India, comprising G. S. Singhvi and Asok Kumar Ganguly, JJ., oversaw the progress of the 2G Spectrum case. Reports from the CBI, Enforcement Directorate, and a one-man Commission were presented and reviewed in court. The CBI assured the filing of chargesheets by a specified date and added officers to the investigation team to ensure timely completion. The Court expressed satisfaction with the attention given to the case by the Director of the CBI. When asked about actions against beneficiaries of UAS licenses involved in causing public revenue loss, an adjournment was requested to seek instructions. The Court suggested the establishment of a separate Special Court for 2G Spectrum cases, to which the Attorney General requested time for consultation before making a statement. The case was adjourned for further consideration to 01.03.2011 to accommodate this request. To maintain the integrity of the investigation, the Court directed that no other court should hinder the ongoing investigations by the CBI and Enforcement Directorate. The reports were re-sealed and placed under the custody of the Secretary General of the Court.
Establishment of Special Court:
The Court proposed the establishment of a separate Special Court to handle cases related to the 2G Spectrum issue. The Attorney General and senior counsel for the CBI requested time to consult with relevant authorities before making a statement on this matter. The Court accepted this request and adjourned the case for further discussion to 01.03.2011.
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2011 (2) TMI 1503
Issues:
Challenge to the vires of Customs Tariff Rules, 1995 and related Notifications; Validity of rules under Article 19(1)(g) of the Constitution.
Analysis:
The petitioner challenged the Customs Tariff Rules, 1995 and related notifications on the grounds of limited scope of hearing and violation of fundamental rights under Article 19(1)(g) of the Constitution. The petitioner's appeal was pending before the CESTAT, and the Court refrained from delving into the merits of the case due to the pending appeal. The Court noted that the scope of hearing under Rule 6(5) was not limited to specific matters as contended by the petitioner.
Legal Provisions and Interpretation:
Section 9A of the Act empowers the Central Government to impose Anti-Dumping Duty to prevent unfair trade practices like dumping. The Act aims to maintain a level playing field by preventing dumping that harms domestic industries. The rules provide for investigation into dumping, injury, and causality. The Designated Authority initiates investigations, issues public notices, and gives affected parties an opportunity to be heard. The rules also outline principles for determining normal value, export price, margin of dumping, and injury.
Constitutional Validity and Fundamental Rights:
The Court emphasized that the provision for Anti-Dumping Duty is not violative of the petitioner's fundamental rights but rather serves to safeguard the interests of the domestic industry. The Court held that the rules, which are within the scope of the main provision, are not unconstitutional. The investigation focuses on issues related to dumping, injury, and causality to impose anti-dumping duty equal to the margin of dumping, in line with the objectives of Section 9A of the Act.
Final Decision:
Ultimately, the Court dismissed the writ petition challenging the vires of Customs Tariff Rules, 1995 and related notifications. The Court found no grounds to declare the rules ultra vires the Constitution, as the rules were deemed to be within the scope of the main provision and not violative of fundamental rights. The Court instructed the petitioner to pursue the pending appeal before the CESTAT for further consideration.
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2011 (2) TMI 1502
The High Court of Bombay quashed a notice seeking to reopen an assessment for AY 2004-05 under Section 148 of the Income Tax Act, 1961. The assessment was sought to be reopened only on the ground that bad debts were not proved to be irrevocable. The court ruled in favor of the petitioner based on a precedent set by the Apex Court in the case of T.R.F. Ltd. v/s. Commissioner of Income Tax.
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2011 (2) TMI 1501
The Supreme Court condoned the delay and dismissed the appeals due to similar issues raised in previous cases.
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2011 (2) TMI 1500
Issues Involved:
1. Erroneous or prejudicial assessment order.
2. Re-examination of allowance under Section 80-IA.
3. Determination of the assessee as a developer or a works contractor.
4. Interpretation of the term "developer" and the impact of retrospective amendments.
5. CIT's authority to invoke Section 263 based on retrospective amendments.
Detailed Analysis:
1. Erroneous or Prejudicial Assessment Order:
The CIT held that the assessment order was erroneous and prejudicial to the interests of the revenue, as the Assessing Officer (AO) did not properly examine the assessee's claim for deduction under Section 80-IA. The AO had allowed the deduction without sufficient inquiry into whether the assessee was merely executing a works contract or developing an infrastructure project.
2. Re-examination of Allowance Under Section 80-IA:
The CIT directed the AO to re-examine the allowance under Section 80-IA. The AO initially allowed a deduction of Rs. 5,49,16,262 out of the claimed Rs. 6,49,54,397 after disallowing interest. The CIT found that the AO did not properly investigate whether the assessee was entitled to the deduction, given the retrospective amendment to Section 80-IA, which excluded works contracts from eligibility.
3. Determination of the Assessee as a Developer or a Works Contractor:
The CIT found that the assessee was executing a works contract rather than developing an infrastructure project. The assessee argued that it developed the entire "Saurashtra Branch Canal Water Supply/Pumping Scheme" on a turnkey basis, which involved substantial investment and technological innovation. The CIT, however, concluded that the assessee was not the developer but a contractor for SSNNL, which was the actual developer.
4. Interpretation of the Term "Developer" and the Impact of Retrospective Amendments:
The assessee contended that the term "developer" should be interpreted liberally and that it was not necessary for the developer to own the infrastructure project. The retrospective amendment to Section 80-IA, which excluded works contracts, was a key point of contention. The assessee argued that at the time of the original assessment, two views were possible regarding the interpretation of "developer," and the subsequent amendment should not render the AO's order erroneous.
5. CIT's Authority to Invoke Section 263 Based on Retrospective Amendments:
The CIT invoked Section 263, arguing that the AO's order was erroneous due to the retrospective amendment. The assessee relied on the Supreme Court's decision in CIT Vs. Max India Ltd., which held that an assessment order could not be considered erroneous if two views were possible at the time of the original assessment. The Tribunal agreed with the assessee, stating that the AO's view was one of the possible interpretations at the time, and the retrospective amendment did not justify the invocation of Section 263.
Conclusion:
The Tribunal set aside the CIT's order invoking Section 263 for both assessment years 2003-04 and 2004-05. It held that the AO had taken one of the possible views available at the time of the original assessment, and the retrospective amendment did not render the AO's order erroneous or prejudicial to the interests of the revenue. The appeals of the assessee were allowed.
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2011 (2) TMI 1499
Issues involved: Condonation of delay in filing appeals, amendment of appeal memorandum, waiver of predeposit of duty and penalty, fraudulent claim for drawback, liability of the perpetrator, predeposit amounts, compliance deadline.
Condonation of delay and Amendment of appeal memorandum:
The applications for condonation of delay in filing the appeals by certain parties were allowed as reasons for the delay were satisfactory. Additionally, miscellaneous applications for amendment of appeal memorandum were also allowed.
Waiver of predeposit of duty and penalty:
The Tribunal considered the stay petitions for waiver of predeposit of duty and penalty. It was found that duty demands were confirmed due to fraudulently obtained drawbacks, with overvalued export consignments and unrealized sale proceeds. The case of M/s.Appu Apparels was highlighted as representative of others involved. The main person, Shri K.Gunasekar, was identified as the perpetrator who floated multiple concerns and manipulated export processes. The Tribunal directed predeposit of the entire drawback amount in the case of M/s.Appu Apparels, while for other cases, predeposit of 50% of duty drawback and 25% of penalties was ordered. Non-compliance within 8 weeks would lead to vacation of stay and dismissal of appeal.
Compliance Deadline:
The compliance report was required by a specified date, and the operative part of the order was pronounced in open court on a different date.
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2011 (2) TMI 1498
The Bombay High Court quashed and set aside the impugned order of the ITAT dated 16th April, 2009 in ITA Nos.7617/M/2005 relating to the assessment year 2002-03. The matter is restored to the file of ITAT for fresh consideration. The appeal was disposed of accordingly.
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