Revision of assessment - levy of tax - 'C' Form not filed - reversion of the input tax credit - Held that:- The petitioner is entitled to file Form of Declaration / Certificate relating to the year at any time before the final assessment of the accounts of that year. In this case, the petitioner has filed 'C' Form in original before the authority of the respondent and an endorsement has also been made by the concerned officer.
Admittedly, both the parties admit that the receipt will be in-triplicate and the seller will retain a copy and furnish the original with the Department - When the authority has misplaced the original of the document for whatever be the reason, there is no hard and fast rule to deny the request of the petitioner for accepting the duplicate copy of the document, which is available with the petitioner.
The matters are remitted back to the respondent for considering afresh and for passing appropriate orders on merits and in accordance with law - appeal allowed by way of remand.
Whether learned trial Court did not properly appreciate oral as well as documentary evidence placed on record and whether learned trial Court had committed miscarriage of justice as mentioned in memorandum of grounds of appeal?
Held that:- The learned trial Court did not commit any miscarriage of justice and it is further held that learned trial Court has properly appreciated oral as well as documentary evidence placed on record - Contraband will be forfeited in favour of State of H.P. in accordance with law after the expiry of limitation for filing further proceedings.
Supreme Court dismissed the appeal in the case with citation 2015 (2) TMI 1292 - SC. Judges were Mr. H.L. Dattu, Mr. Sudhansu Jyoti Mukhopadhaya, and Mr. A.K. Sikri.
Upon payment of ₹ 25,000/- by way of costs to the sole respondent within two months from today, the impugned Judgment shall be set aside and Tax Appeal No. 3 of 2013 shall be restored to its original number and shall be heard on merits by the High Court - The Civil Appeal is allowed.
Refund of the amount received by the petitioner by encashing the performance bond issued by the banker of the respondent no.1 - Petitioner on account of delays in the deliveries enforced the performance bond given by the respondent no.1 - Liquidated damages - whether or not it was the petitioner or the respondent no.1 who was guilty of breach of contract - Indian Contract Act, 1872.
Held that:- The contract has as per its express terms set out in seriatim the schedule of compliances of respective obligation by both the parties under the contract. As per Section 52 of the Indian Contract Act, 1872, once the order of reciprocal promises to be performed are expressly fixed by the contract, they are to be performed in the order to be fixed by the contract, and hence the performance bond to be given by the respondent no.1 under OMP No.408/2007 page 17 of 42 Article 2.1 of the Contract would be a condition precedent to the respondent no.1 giving the notification of readiness under Articles 4.2 and 7.2 of the Contract. So far as the first consignment is concerned, giving of warranty bond before 10 days of the delivery of the first consignment would be a condition precedent before supplying of second and third consignments.
Contention urged on behalf of the respondent no. 1 that there is no schedule of compliances in a particular manner under the contract of what has to be performed first and what has to be performed at subsequent stages and that giving of performance bond and warranty bond are not a condition precedent for the petitioner to open the L.C.s, is thus a wholly misconceived argument inasmuch as a reading of the contractual clauses as a whole clearly shows the pre-condition of giving of the performance bond before issuance of the letter of credit by the petitioner for payment of the goods of the first consignment inasmuch the time schedule fixed with respect to giving of the performance bond by the respondent no. 1 is prior in point of time to the issuance of the notification of readiness for the first consignment because the giving of performance bond is within 30 days of entering into the contract and the date of delivery of the fist consignment is after 120 days of the contract.
Whereas the giving of the letter of credit for the first consignment was not a condition precedent for the respondent no.1 to give the warranty bond under Article 9.1 of the Contract and which was to be given 10 days prior to the receipt of the first consignment in India, however, the fact that warranty bond was to be given at least 10 days before the arrival of the first consignment obviously shows that giving of the warranty bond was a condition precedent to be complied with before the notification of readiness could be issued and the second and third consignments could be delivered by the respondent no.1 to the petitioner under the contract.
The performance bond to be given as per Article 2.1 of the Contract is in the nature of liquidated damages under Section 74 of the Indian Contract Act considering the nature of the present contract. The majority Award however has against the settled principles of law and catena of judgments of the Supreme Court wrongly and illegally held that Articles 2.2 and 10 of the Contract do not entitle the petitioner to seek enforcement of the performance bond towards liquidated damages. It is settled law in this country in terms of various Supreme Court judgments that once the nature of the contract is such that losses cannot be easily calculated, the amount OMP No.408/2007 page 20 of 42 claimed as liquidated damages can be claimed as per Section 74 of the Indian Contract Act, 1872 without proving and showing how much loss has been caused.
Whether the majority Award can be said to be illegal or in violation of the contractual provisions or perverse so that this Court can interfere with the same under Section 34 of the Act? - Held that:- This aforesaid conclusion of the majority Award is clearly against the law of this land because the law of this land says that there are two types of contracts, one type of contract is where the actual loss can be calculated and in which type of contracts even if there is a clause of liquidated damages yet only actual loss will be granted subject to the upper limit as specified in the liquidated damages clause under Section 74 of the Indian Contract Act, and the second type of contract is where loss is caused but loss cannot be determined/calculated in view of the nature of the contract and in these latter types of contracts, courts allow enforcement of liquidated damages under Section 74 of the Indian Contract Act.
The subject contract is of a type where how much loss is caused to the petitioner/Ministry of Defence, Government of India for delay in supply of parachutes cannot be calculated because how the Army of this country would have been affected by non- delivery of the parachutes on time and what would have been the alternative arrangements made due to delayed deliveries and expenses accordingly which had to be incurred on account of non-availability of parachutes on time, is impossible to calculate and hence Articles 2 and 10 of the subject Contract are valid and can be enforced for enforcement of liquidated damages as per Section 74 of the Indian Contract Act. Clearly, therefore, the majority Award has gone against the settled principles of law for holding that a performance bond is a mere security and cannot be used towards enforcement of the Articles 2 & 10 of the Contract of liquidated damages as per Section 74 of the Indian Contract Act. An illegal Award, in view of Section 28(1)(b)(i) of the Act cannot be sustained.
Other conclusion which has been arrived at by the majority Award is that the petitioner had no right to enforce the performance bond because the performance bond as per the contract was only for a period OMP No.408/2007 page 24 of 42 of 90 days following the delivery of the third consignment which took place on 25.6.2003, and since performance bond was sought to be encashed on 19.6.2004 ie 90 days after 25.6.2003, the petitioner was hence disentitled to encash/enforce the performance bond - Held that:- Clearly the above conclusion of the majority Award is perverse to say the least because admittedly the performance bond was repeatedly renewed, and therefore, once it is repeatedly renewed by means of letters exchanged, and the corresponding documents issued to the bank, there did take place a written amendment to the contract. Also, respondent no.1 was in any case estopped in any manner from questioning the enforcement of the performance bond as it all along had acted on the basis of extensions given by it to the period of the performance bond.
Third conclusion given by the majority Award is that there is no reference in the pleadings of the petitioner filed in the arbitration proceedings to Article 10 of the Contract and therefore a claim based of the petitioner on Article 10 is against law and cannot be looked at - Held that:- Once again this aforesaid conclusion and finding of the Arbitration Tribunal is wholly perverse to say the least because even if Article 10 of the Contract is not mentioned by reference, the entire case of the petitioner in the arbitration proceedings has been the entitlement of the petitioner to encash the performance bond on account of delay in deliveries by the respondent no.1 to the petitioner and this is so stated by the Arbitrator themselves in para 23 first line and para 22 first line of the impugned Award.
Since the order of performance has been mentioned in the contract, Section 52 of the Indian Contract Act comes into play and the order of performance necessarily means that before the first letter of credit is issued for the first consignment of delivery, the respondent no.1 necessarily had to issue the performance bond under Article 2.1 of the Contract and which was to be issued within 30 days of signing the contract, and since this pre-condition of performing of the reciprocal obligation by the respondent no.1 of issuing of the performance bond was not complied with, the respondent no.1 hence could not claim performance by the petitioner of the reciprocal obligation of opening of the letter of credit with the same reasoning for giving of warranty bond for second and third consignments.
The majority Award is therefore clearly illegal and perverse with respect to this finding that it was the petitioner who should be held guilty of breach of contract of not giving the letters of credit because the Arbitrators in the majority Award in fact were duty bound to hold that it was the respondent no.1 who was guilty of breach of contract and not the petitioner.
Validity of notice U/s 148 - AIR information received from CIB, it came to notice that the sale value of a property sold by the assessee was adopted by the Sub-Registrar - Held that:- Assessing Officer has vast power U/s 147 within four years when there was no scrutiny assessment in the case of the assessee. The case laws cited by the learned counsel for the assessee are squarely not applicable. The information received from CIB is simple information, has not construed any opinion. It is for AO to decide whether this information can be part of the reason to believe or not. In this case, it is undisputed fact that the assessee has not taken sale consideration of the immoveable property as per Section 50, which is deeming provision on computation of capital gain. Therefore, we confirm the reopening made by the Assessing Officer, confirmed by the learned CIT(A). This ground of assessee’s appeal is dismissed.
Taking sale value consideration on the basis of sale deed for stamp valuation and computing capital gain - non reference of valuation of land to the DVO - Held that:- It is undisputed fact that the assessee simply challenged the sale consideration on the basis of stamp valuation authority but had not requested to refer this issue to the DVO but the Hon’ble Calcutta High Court in the case of Sunil Kumar Agarwal Vs. CIT, Siliguri [2014 (6) TMI 13 - CALCUTTA HIGH COURT] as held the valuation by the departmental valuation officer, contemplated u/s 50C, is required to avoid miscarriage of justice - The legislature did not intend that the capital gain should be fixed merely on the basis of the valuation to be made by the District Sub Registrar for the purpose of stamp duty - Even in a case where no such prayer is made by the learned advocate representing the assessee, who may not have been properly instructed in law, the AO, discharging a quasi-judicial function, has the bounden duty to act fairly and to give a fair treatment by giving him an option to follow the course provided by law – thus, the order is set aside and the matter is remitted back to the AO as directed to refer the valuation of land to the DVO for the purpose of valuation of the land on the date of sale – Decided in favour of Assessee for statistical purposes only..
CENVAT Credit - duty paying documents - Revenue entertained a view that the documents on the basis of which the respondent has taken the credit were not proper documents and the invoices issued by RCL, on the basis of which the respondent has taken the credit, were not covering the consignments in question - Held that:- As observed by Commissioner (Appeals), there is no doubt that the respondents have received the goods directly from Chennai and have used the same in the manufacture of their final product. As such, the procedural and technical objections raised by the Revenue cannot be appreciated - appeal dismissed - decided against Revenue.
Illelegal mobilizing funds from the public - carrying on the activities of a 'Collective Investment Scheme' - Whether HBN is operating a CIS without obtaining registration from SEBI? - Whether HBN has failed to repay to the investors as per the approved detailed procedure? - Held that:- Payments were made without the supervision of RTA, though this was a condition stipulated by SEBI for making repayments. Further, the statement that the Company had made cash payments is also a breach of such conditions. It has also been stated that HBN has deducted 25% of the amounts payable to the investors as a penalty. The Company cannot make any such deduction, as the liability to repay the investors has arisen out of its illegal manner of fund mobilization from them. Therefore, wherever such deductions were made, HBN shall make full payments to its investors with returns that were assured. The auditor has also observed that HBN did not provide full chain of repayments and also that it has used the stationery of group companies for making payments. These statements therefore create a doubt as to whether the claim of partial repayments made by the Company, is genuine.
Noticee were the directors of HBN at the relevant period time and have resigned later-on. In view of the same, these five notices are also liable and responsible along with Mr. Harmender Singh Sran, Mr. Amandeep Singh Sran, Ms. Manjeet Kaur Sran and Ms. Jasbeer Kaur, for the violations committed by HBN in running CISs without obtaining registration from SEBI as required under law, during the period when they were the directors.
Company had all the opportunity to sell its properties since July 12, 2013 (except for the period July 30, 2014 to December 09, 2014, when the restraint order of Hon'ble Delhi High Court was operative) and make repayments to its investors. Also note that there was no restraint on recalling the loans and advances so as to make the repayments. No hesitation in holding that HBN failed to comply with the directions of SEBI read with the Repayment Procedure forwarded to HBN on January 06, 2014.
In exercise of the powers conferred upon me under Section 19 of the Securities and Exchange Board of India Act, 1992 and Sections 11(1), 11B and 11(4) thereof and Regulation 65 of the SEBI (Collective Investment Schemes) Regulations, 1999, hereby issue the following directions:
a. HBN Dairies & Allied Limited [PAN: PAN: AAACH7852C] and its directors/ former directors namely Mr. Harmender Singh Sran [PAN: AIGPS2229B], Mr. Satnam Singh Randhava, Mr. Amandeep Singh Sran [PAN: AUVPS5370E], Mr. Gajraj Singh Chauhan [PAN: ADXPC6922H], Ms. Manjeet Kaur Sran [DIN: 00105878], Ms. Jasbeer Kaur [DIN: 00161623], Mr. Rakesh Kumar Tomar [DIN: 06824416], Mr. Sukhdev Singh Dhillon and Ms. Sukhjeet Kaur shall abstain from collecting any money from the investors or launch or carry out any Collective Investment Schemes including the scheme which have been identified as a Collective Investment Scheme in this Order.
b. HBN Dairies & Allied Limited and its directors/ former directors namely Mr. Harmender Singh Sran, Mr. Satnam Singh Randhava, Mr. Amandeep Singh Sran, Mr. Gajraj Singh Chauhan, Ms. Manjeet Kaur Sran, Ms. Jasbeer Kaur, Mr. Rakesh Kumar Tomar, Mr. Sukhdev Singh Dhillon and Ms. Sukhjeet Kaur are restrained from accessing the securities market and are prohibited from buying, selling or otherwise dealing in securities market for a period of four (4) years.
c. HBN Dairies & Allied Limited and its directors namely Mr. Harmender Singh Sran, Mr. Amandeep Singh Sran, Ms. Manjeet Kaur Sran and Ms. Jasbeer Kaur shall forthwith wind up the existing Collective Investment Schemes and refund the money collected by the said company under the schemes with returns which are due to its investors as per the terms of offer, on or before March 09, 2015 and thereafter within a period of fifteen days, submit a winding up and repayment report to SEBI in accordance with the SEBI (Collective Investment Schemes) Regulations, 1999, including the trail of funds claimed to be refunded, bank account statements indicating refund to the investors and receipt from the investors acknowledging such refunds.
d. The Company shall provide proof including trail of funds, bank statements to support its contention that it has refunded the monies to its investors.
e. HBN Dairies & Allied Limited and its directors namely Mr. Harmender Singh Sran, Mr. Amandeep Singh Sran, Ms. Manjeet Kaur Sran and Ms. Jasbeer Kaur shall not alienate or dispose off or sell any of the assets of HBN Dairies & Allied Limited except for the purpose of making refunds to its investors as directed above.
f. HBN Dairies & Allied Limited and its directors/ former directors namely Mr. Harmender Singh Sran, Mr. Satnam Singh Randhava, Mr. Amandeep Singh Sran, Mr. Gajraj Singh Chauhan, Ms. Manjeet Kaur Sran, Ms. Jasbeer Kaur, Mr. Rakesh Kumar Tomar, Mr. Sukhdev Singh Dhillon and Ms. Sukhjeet Kaur are also directed to provide a full inventory of all their assets and properties and details of all their bank accounts, demat accounts and holdings of shares/securities, if held in physical form.
g. In the event of failure by HBN Dairies & Allied Limited and its directors namely Mr. Harmender Singh Sran, Mr. Amandeep Singh Sran, Ms. Manjeet Kaur Sran and Ms. Jasbeer Kaur to comply with the above directions on or before March 09, 2015, the following actions shall follow:
- HBN Dairies & Allied Limited and its directors namely Mr. Harmender Singh Sran, Mr. Amandeep Singh Sran, Ms. Manjeet Kaur Sran and Ms. Jasbeer Kaur shall remain restrained from accessing the securities market and would further be prohibited from buying, selling or otherwise dealing in securities, even after the period of four (4) years of restraint imposed in Paragraph 20 (b) above, till all the Collective Investment Schemes of HBN Dairies & Allied Limited are wound up and all the monies mobilized through such schemes are refunded to its investors with returns which are due to them.
- SEBI would make a reference to the State Government/ Local Police to register a civil/ criminal case against HBN Dairies & Allied Limited, its promoters, directors and its managers/ persons in-charge of the business and its schemes, for offences of fraud, cheating, criminal breach of trust and misappropriation of public funds; and
- SEBI would make a reference to the Ministry of Corporate Affairs, to initiate the process of winding up of the company, HBN Dairies & Allied Limited.
- SEBI shall also initiate attachment and recovery proceedings under the SEBI Act and rules and regulations framed thereunder.
Maintainability of appeal - appeal was dismissed for non-compliance with the stay order - contention of learned counsel is that the Commissioner (Appeals) should have decided the issue on merits without insisting on any pre-deposit - Held that:- The appellant’s Bank Guarantee to the extent of ₹ 32.62 crores already stands en-cashed by Revenue during pendency of the proceedings - The direction to the appellant to further deposit an amount of ₹ 40 lakhs is not appropriate.
Matter remanded to the Commissioner (Appeals) to decide the issue on merits without insisting any pre-deposit.
Allowable expenses u/s 30 - revenue expenditure or capital expenditure - The office at Kolkata was gutted by fire. The fire, as a matter of fact, continued for four days. Damages were of an extensive nature. The assessee after obtaining permission from the Fire Brigade Department entered into the burnt down office after four days. In repairing the office it incurred a little over a sum of ₹ 7 lakhs. Goa laboratory of the assessee was badly damaged by flood and cyclone which was also required to be repaired and in doing so the assessee incurred an expenditure of a sum of ₹ 3 lakhs approximately.
Held that:- The assessing officer has no-where pointed out that by incurring expenditure the assessee has enhanced his capital assets. On the contrary, the finding is that the expenditure was necessary to repair the damage caused by fire. It was, therefore, clear case of a revenue expenditure. - Decided in favor of assessee.
Deduction u/s 80P - assessee carries on the banking business and other business in the name of a credit cooperative society - Held that:- Activities of the assessee were limited to the members of a specific group and the area of operative was also limited to the acceptance of deposits of the members and providing credit facilities only to the members, which have been held not falling under the banking activities as defined in the Banking Regulation Act - CIT (A) has rightly adjudicated the issue under consideration by holding that the assessee as a cooperative bank, the deduction of claim u/s 80P(2)(a)(i) of the Act cannot be denied is fair and reasonable and it does not call for any interference. - Decided against revenue
Interest income - treated as ‘income from other sources’ or 'busniss income' - Held that:- The assessee was engaged in the business of development and construction of properties. The assessee firm had received advances from customers and money received through such advances which were not required immediately was deposited in FDRs etc. on temporary basis. The interest credited on such deposits was deducted from the work in progress. Assessing Officer taxed such interest as ‘income from other sources’.
Referring to decision of Hon'ble Supreme Court in the case of CIT v Bokaro Steel Ltd.(1998 (12) TMI 4 - SUPREME COURT) and held that interest income is to be assessed as business income because the assessee had already commenced business. In this background the interest income was held to be not taxable. In our opinion, the facts of the assessee’s case are identical to this case and, therefore, following this decision, we hold that interest income cannot be treated as ‘income from other sources’ as since he same has been reduced from the work in progress, the same is not taxable. Therefore, we set aside the order of Ld. CIT(A) and delete the addition. - decided in favour of assessee.
Transponder fees payable by the appellant to Intelsat corporation - Whether in the nature of 'royalty' as per provisions of the income tax Act, 1961 and the India-USA Tax Treaty - Held that:- The payments made for use/ right to use of process falls in the ambit of expression royalty as per DTAA as well as provisions of Income Tax Act.
TDS u/s 195 - Non-deduction of TDS on payment of commission to Foreign Agent - income accrued in India - Held that:- As decided in INCOME-TAX OFFICER, CO. WARD-II(1) VERSUS FAIZAN SHOES (P.) LTD. [2014 (1) TMI 440 - ITAT CHENNAI] Non-residents were only procuring orders for the assessee and following up payments and apart from that, no other services were being rendered. That since non-residents were not providing any technical services to assessee, payments made to them did not fall under category of royalty or fee for technical services u/s 9(1)(vii. Even otherwise, since commission paid to non-resident was not taxable in India, the assessee was not required to deduct tax at source while making said payments. The facts in the present case are identical because in the present case also, commission was paid to non-resident for procuring orders without deducting tax.
Considering Circular No.7/2009 dated 22/10/2009 as per which Circular No. 786 dated 07/02/2000 was withdrawn, it comes out that in the facts of the present case, no TDS was required to be deducted because as per this circular in the case of payment of commission to foreign agents, nothing was required to be seen and examined and it could be concluded that no TDS was required to be deducted.
Since, in the present case, this is not a case of the revenue that the services were rendered in India or the payment was made in India and the incomes in the hands of the non resident agent can be considered as deemed to accrue or arise in India by way of operation of section 9 (1), no disallowance can be made u/s 40(a)(i) - Also considered the explanation to section 9(2) and have seen that this explanation also has no relevance in the present case and therefore, we decline to interfere in the order of CIT(A). - Decided in favour of assessee.
Pre-deposit - Whether the first respondent Tribunal is right in rejecting the appellant's application for waiver of pre-deposit without considering “undue hardship”, which is a relevant factor while exercising powers under Section 35-F of the Central Excise Act? - Held that:- In view of the well considered order of the Tribunal, wherein the prima facie case and financial hardship of the appellant were taken into consideration while ordering pre-deposit, which order has not been complied with, the bona fide of the appellant in filing the appeal now itself is in question - This Court finds no reason to interfere with the order of the Tribunal at this point of time, more so when the issue has become stale by efflux of time. The appellant is unable to point out any question of law that warrants consideration by this Court to justify this appeal.
Claim of deduction u/s. 80IB(10) - flats no.403 and 404 exceeded threshold limit of 1500 sq.feet as per section 80IB(10)(c) - Held that:- The residential units with all rights and title stood transferred much before insertion of clause (f) in section 80 IB(10) by the Finance Act, 2009 w.e.f. 01.04.2010 having prospective effect only. The assessee has recognized the said receipts in the relevant previous year as per its system of accounting regularly followed. We find that a co-ordinate bench of the ‘tribunal’ in Emgeen Holdings (P) Ltd vs. DCIT (2011 (5) TMI 958 - ITAT MUMBAI) has held that this amendment would only have prospective effect. It is an undisputed fact that the assessee’s residential units stood transferred to the aforesaid vendees well before the amendment
We reiterate that section 80IB(10) is a deduction provision to be liberally construed. Therefore, the assessee succeeds so far as application of clause (f) of section 80IB(10) is concerned.
For flats no.403 and 404 measure more than 1500 sq.feet i.e. 1653 and 1572 sq.feet respectively. The assessee fails to rebut this factual position. Section 80IB(10)(c) prescribes measurement of a residential unit to be upto 1500 sq.feet only. The language used in this specific clause refers the residential unit. This expression does not bar a deduction claim altogether if some of the units sold exceed the specified dimensions. In such a case, the consequential disallowance has to be proportionate only. It has to be restricted to profits derived from the residential units violating section 80IB(10)(c). Case law CIT vs. ARUN EXCELLO FOUNDATIONS (P) LTD (2012 (12) TMI 415 - MADRAS HIGH COURT) is also quoted in support - Decided in favour of assessee partly.
Valuation - Withdrawal of the compounded levy scheme - demand of duty on the basis of actual clearances - case of appellant is that the duty paid by them at compounded rate was more than the duty liability on the basis of their actual clearances, the excess duty so paid should be adjusted against their duty liability for January 1999 to June 1999 period.
Held that:- If the duty paid under compounded levy scheme during July 1999 to November 1999 period was more than the duty payable by the appellant on the actual clearances made by them and, as such, there was excess payment of duty during this period, the same has to be adjusted against their duty liability for the period from January 1999 to June 1999 - the matter is remanded to the Commissioner for re-quantification of the duty demand on this basis - appeal allowed by way of remand.
Refund of SAD - N/N. 102/2007-Cus. dated 14.09.2007 - denial on the sole ground that the appellants have made an endorsement in the invoice as regards non-passing of the credit of SAD, the said endorsement is not in the format prescribed in the notification - Held that:- It is not a case of non-endorsement. There is admittedly an endorsement on the invoices, thus satisfying the conditions of the notification. Difference in use of language cannot be adopted as a reason for denial of the refund of SAD.
The issue stands decided by the Larger Bench decision of the Tribunal in the case of Chowgule & Company Pvt. Ltd. Vs. CCE [2014 (8) TMI 214 - CESTAT MUMBAI (LB)], where it was held that non-declaration of SAD in commercial invoice is affirmation that no cenvat credit thereof would be available.
Profit at 5% from wine business - Held that:- When the authority concerned has exercised discretion while estimating profit at a particular rate, it cannot be interfered with such exercise of discretion, unless such exercise of discretion is absolutely arbitrary.
The net profit percentage declared by assessee from AY 2009-10 to 2013-14 varies between 1.54% to 3.50%. Though, it is a fact that initially the Tribunal had adopted the net profit rate of 3% in case of retail trade in wine, but, subsequently, in many cases, the Tribunal has approved estimation of profit at 5%. Therefore, considering the totality of facts and circumstances of the case, we are of the view that estimation profit at 5% on the cost of goods in the present case is justified. - Decided against assessee.
Demand of service tax - sharing of profit - share of revenue paid to the appellant for the services jointly provided by the applicant along with M/s. Geojit Commodities Ltd. - Held that: - M/s. Geojit Commodities had been discharging service tax under the category of forward contract service regularly and if tax were to be collected from the appellant it would amount to taxing the same service twice - reliance placed in the case of VIJAY SHARMA & CO. VERSUS. COMMISSIONER OF CENTRAL EXCISE, CHANDIGARH [2010 (4) TMI 570 - CESTAT, NEW DELHI], where it was held that the same service cannot be taxed twice - appeal allowed.
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