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Showing 141 to 160 of 1526 Records
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2023 (10) TMI 1386
Levy of late fees u/s 234E - intimations u/s 200A for delay in filing quarterly returns of TDS for the period prior to 01.06.2015 - HELD THAT:- The dispute in this appeal is for F.Y. 2012-13 the power to levy the said late fees u/s 234E of the I. T. Act has is came into effect from 01.06.2015. Therefore, it is prospective in nature. In the light of this facts when the levy was not supported by the law the demand is raised is not in accordance with the law. Similar view is taken in the case of Madhya Pradesh Gramin Bank [2022 (11) TMI 771 - ITAT INDORE] as held the issue has already been decided in favour of the assessee that the late fees u/s 234E of the Act could not have been levied in the intimation u/s 200A for delay in filing quarterly returns of TDS the said power to levy fees has come into effect from 01.06.2015. Thus this appeal of the assessee is allowed.
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2023 (10) TMI 1385
Approval of Resolution Plan - Department of State Tax is a secured creditor or not - HELD THAT:- The issues raised in the appeal are fully covered by the judgment of this Appellate Tribunal in DEPARTMENT OF STATE TAX, THROUGH THE DY. COMMISSIONER OF STATE TAX VERSUS ZICOM SAAS PVT. LTD. & ANR. [2023 (2) TMI 1170 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI] where in the appeal filed by Department of State Tax similar issues were decided and it was held that Department of State Tax is not a secured creditor.
Appeal dismissed.
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2023 (10) TMI 1384
Addition u/s 14A r.w. rule 8D - assessee earned exempt income during the year and the provisions u/s 14A were mandatory provisions to arrive at correct real income, it was necessary to apportion the expenditure between taxable and non taxable income - 100% depreciation claimed on temporary erections - Asset used less than 180 days - addition of loss on shifting of securities from AFS/HTS category to HTM category - Disallowance u/s 36(1)(vii) - ITAT allowed all the ground in favour of assessee - HELD THAT:- Out of the proposed questions of law, question numbers (A) to (D) are covered by a decision rendered by this court in a bunch of appeals, the lead appeal Pr. Commissioner of Income Tax vs. Oriental Bank of Commerce (now merged with Punjab National Bank Ltd) [2023 (10) TMI 1244 - DELHI HIGH COURT]
MAT provision applicability on assessee banking company - HELD THAT:- The said appeals concern AYs 2014-15, 2015-16 and 2013-14.We may note that during the said AYs, admittedly, the proposed question (E) was not raised by the appellant/revenue. Therefore, having regard to the principle of consistency, in our view, proposed question no. (E) cannot be considered in the aforementioned AY i.e., AY 2016-17.
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2023 (10) TMI 1383
Validity of exercise of jurisdiction u/s 153A and 153C - AO justification in passing the assessment orders u/s 143(3) and not u/s 153C - validty of assessment orders passed u/s 143(3) - HELD THAT:- Matter to be covered by the decision of the Supreme Court in the case of Pr. CIT Vs Abhisar Buildwell P. Ltd [2023 (4) TMI 1056 - SUPREME COURT] wherein held no addition can be made in respect of completed assessment in absence of any incriminating material.
Also Lordships concluded :-
i) that in case of search under Section 132 or requisition under Section 132A, the AO assumes the jurisdiction for block assessment under section 153A;
ii) all pending assessments/reassessments shall stand abated;
iii) in case any incriminating material is found/unearthed, even, in case of unabated/completed assessments, the AO would assume the jurisdiction to assess or reassess the ‘total income’ taking into consideration the incriminating material unearthed during the search and the other material available with the AO including the income declared in the returns; and iv) in case no incriminating material is unearthed during the search, the AO cannot assess or reassess taking into consideration the other material in respect of completed assessments/unabated assessments. Meaning thereby, in respect of completed/unabated assessments, no addition can be made by the AO in absence of any incriminating material found during the course of search under Section 132 or requisition under Section 132A of the Act, 1961. However, the completed/unabated assessments can be re-opened by the AO in exercise of powers under Sections 147/148 of the Act, subject to fulfilment of the conditions as envisaged/mentioned under sections 147/148 of the Act and those powers are saved.
In view of the above detailed reasoned judgement rendered by the Hon'ble Supreme Court in “Abhisar Buildwell P.Ltd.” (supra), Question No. 1 raised before us, i.e., as to whether the AO was justified in passing the assessment orders u/s 143(3) and not u/s 153C of the Act is answered in the negative and Question No.2, as to whether the assessment orders passed u/s 143(3) are invalid and bad in law is answered in the affirmative. Both these Questions, thus, are answered in favour of the assessee.
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2023 (10) TMI 1382
Classification of service - supply of tangible goods for use service or otherwise - providing the cylinder skid vehicle to the service recipient on charge based on per trip - HELD THAT:- As per the fact which is not in dispute between the appellant and the revenue that the charges for providing the vehicle to Raj & Company is on per trip basis. This shows that the transaction is not of renting of vehicle as in case of renting the fixed amount is charged on monthly basis or lump sum, however, if the charge is on the basis of per trip that prima facie shows the activity is of transportation.
However, the aspect that whether the activity falls under GTA or otherwise and consequently the liability of service tax can be passed on the appellant was not examined for the obvious reason that neither the department has contended nor the appellant has raised the issue but on the basis of fact it prima facie appears that the activity can be classified under GTA - matter needs to be reconsidered from the aspect of GTA.
The impugned orders are set side - appeals are allowed by way of remand to the Adjudicating Authority.
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2023 (10) TMI 1381
Classification of goods intended to be imported - Clear Float Glass - classifiable under Customs Tariff Item 7005 2990 of the First Schedule to the Customs Tariff Act, 1975 or not - HELD THAT:- All glass manufactured under the float process (clear, coated or tinted) invariably would contain a layer of tin on one side, which does not mean that the float glass is to be classified under 7005 10. Any float glass said to have an absorbent layer will invariably be coated with a microscopically thin coating of metal or metal oxide, provided the coating is done on-line i.e. during the process of manufacturing of float glass, and before the process of annealing, so that the glass isn't regarded as worked. If otherwise, the float glass has to be regarded as one having no absorbent layer.
The float glass has not been undergone any coating process (coating as absorbent, reflecting or non-reflecting layer) and cannot be classified under the Tariff Sub Heading 7005 10. The occurrence of tin layer on one side of the float glass does not make the glass have an absorbent, reflecting or non-reflecting layer. Further, as it is also not coloured throughout the mass (body tinted), opacified, flashed or merely surface ground, the item would not be covered under the Sub heading 7005 21. Hence, the appropriate classification for "clear float glass" would be under the tariff sub heading 7005 29 as "Others". At the 8 digit level, if the item is 'tinted', it would be classifiable under the CTI 7005 2910 and if the item is 'non-tinted' it would be classifiable under CTI 7005 2990 of the Custom Tariff Act, 1975.
The goods in question i.e. the clear float glass don't merit classification under CTI 7005 1090 as claimed by the applicant, instead they merit classification under CTH 7005 and more specifically under CTI 7005 2990 of the first schedule to the Customs Tariff Act, 1975 and accordingly, the benefit of exemption from duty under notification no. 46/2011- Customs dated 01.06.2011 Serial No. 934 which provides exemption to goods classifiable under 70010020 to 70051090 cannot be extended to the subject goods.
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2023 (10) TMI 1380
Reopening of assessment u/s 147 - reasons to believe - reopening beyond period of four years - AO made certain additions by making disallowance of inadmissible items and also recomputed the claim of deduction u/s. 36(1)(viia) - HELD THAT:- In the absence of any failure on the part of the assessee to disclose fully and truly all material facts and assessment framed u/s. 143(3) of the Act and now reopening beyond 4 years which is against the provisions of the Act. Hence, we find no infirmity in the order of CIT(A) and the same is confirmed. This appeal of the Revenue is dismissed.
Power of enhancement of CIT(A) - claim of deduction u/s. 36(1)(viia) - HELD THAT:- We noted that the decision of Hon’ble Supreme Court in the case of Jute Corporation of India [1990 (9) TMI 6 - SUPREME COURT] categorically held that the power of the CIT(A) is co-terminus with that of the AO and enhancement can be made on any issue which was touched upon by the AO in the assessment order. According to Hon’ble Supreme Court, the CIT(A) cannot go beyond the assessment record and discover a new source of income for enhancement.
In the present case before CIT(A), the claim of deduction u/s. 36(1)(viia) of the Act was very much before the AO and he has gone into the claim of deduction and only the issue before CIT(A) is in connection with the correctness of proposal of enhancement of assessment order. We find that the CIT(A) has not adverted to new issue rather this issue is very much under discussion of AO and he has utilized his power of enhancement to correct the assessment order and enhance the income to the extent of claim of deduction u/s. 36(1)(viia) of the Act. The assessee has claimed more than what was provision created in the books of accounts. Hence, we confirm the enhancement and dismiss this issue of assessee’s appeal.
Claim of deduction u/s. 36(1)(viia) - CIT(A) held that the deduction cannot exceed the provision made for bad and doubtful debts in the books of accounts - HELD THAT:- The direct decision available on the issue is only one High Court decision i.e., the Hon’ble Punjab & Haryana High Court in the case of State Bank of Patiala [2004 (5) TMI 12 - PUNJAB AND HARYANA HIGH COURT] and that of Hon’ble Karnataka High Court in the case of CIT vs. Syndicate Bank [2020 (2) TMI 1020 - KARNATAKA HIGH COURT] has explained the provisions and held that the condition precedent for claiming deduction under section 36(1)(viia) is that a provision for bad and doubtful debts should be made in the accounts of the assessee. The language employed in the section is clear and ambiguous. In the absence of any provision, the assessee is not entitled to deduction. However, the assessee is entitled to deduction to the extent provision is made in the accounts subject to the limit mentioned in section 36(1)(viia) of the Act. Hence, this issue decided against the assessee.
Validity of notice issued u/s 143(2) as barred by limitation - HELD THAT:- We noted that the notice u/s. 143(2) of the Act dated 14.08.2014 and 15.07.2014 was issued after return filed u/s. 148 of the Act. The assessee in response to notice u/s. 148 of the Act dated 20.03.2014 filed an application dated 17.04.2014 asking the AO to treat the return filed on 28.09.2009 as the return filed in response to notice u/s. 148 of the Act. This means that the notice u/s. 143(2) of the Act dated 15.07.2014 is within limitation and hence, this issue of assessee does not survive and hence, accordingly dismissed.
Validity of reopening of assessment - AO detected that there is escapement of income in the claim of deduction u/s. 36(1)(viia) of the Act in regard to amount claimed by assessee is in excess of provision made in the books of accounts in regard to provision for bad and doubtful debts - HELD THAT:- There is sufficient material placed on record which shows the existence of income chargeable to tax and which originally ought to have been included in the taxable income while framing assessment but was not so included. Hence, it is sufficient and it itself provide a cause or justification for a belief to the AO that such income had escaped assessment and the AO in such cases would be ex-facie justified in initiating the proceedings u/s. 147 of the Act. It is the case of non-assessment of an item on account of claim of deduction u/s. 36(1)(viia) of the Act in regard to the amount for which no provision for bad or doubtful debt have been created in the books of accounts of the assessee. Hence in our view, the nonassessment of an item of income chargeable to tax would warrant formation of requisite belief to initiate the proceedings within four years from the end of the relevant assessment year even yet where full disclosure was made and income chargeable to tax had escaped assessment from being included in the final assessment order in which taxable income was worked out. Hence according to us, this ground of the assessee does not succeed and hence, dismissed.
Rectification u/s 154 to rectify the claim of deduction u/s. 36(1)(viia) - According to AO, deduction u/s. 36(1)(viia) of the Act is allowable only to the extent of claim made in the books of accounts i.e., provision for bad and doubtful debts made in the books of accounts and it cannot be claimed in the computation simpliciter - HELD THAT:- We noted that there is a lot of debate and it is highly debatable issue and it cannot be decided while acting u/s. 154 of the Act as there is a limitation in the provisions of section 154 of the Act that only the mistake apparent from record which can be rectified but where two views are possible or there is a debate available, it cannot be rectified u/s. 154 of the Act. Here is the case where the AO has allowed this claim while giving effect to the order of CIT(A) dated 18.07.2017 and that cannot be rectified while acting u/s. 154 of the Act. Hence the very issue on assumption of jurisdiction, we allow in favour of assessee and against Revenue. This issue of assessee’s appeal is allowed.
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2023 (10) TMI 1379
Exemption from service tax vide Notification No. 9/2009-ST dated 03.03.2009 as amended by Notification No. 15/2009-ST dated 20.05/2009 - appellant being sub-contractor provided service in SEZ on behalf of the main Contractor - HELD THAT:- Revenue has denied the exemption on payment of service tax under Notification No. 09/2009-ST only for the reason that the appellant being a sub-contractor, have not provided service directly to the SEZ unit or developer of SEZ. On perusal of notification, it is found that notification prescribes that the service which are provided in relation to authorised operation in SEZ and received by a developer or unit of SEZ are exempted from whole of service tax. As per this plain reading of the notification, the only criteria is that the service which is provided, should be in relation to the authorised operations in SEZ and received by a developer or unit of SEZ. In the facts of the present case, there is no dispute that appellant have provided service which are approved by the concerned authority in relation to the authorised operations in SEZ therefore, even the appellant is sub-contractor but the condition of providing service to authorised operation has been satisfied. Therefore, exemption cannot be denied to the appellant.
There is no doubt that service provided by the appellant in the capacity of sub-contractor but in relation to the authorised operations in SEZ are clearly eligible for exemption Notification No. 9/2009- ST dated 03.03.2009 as amended - The impugned order is set aside - appeal allowed.
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2023 (10) TMI 1378
Eligibility for deduction u/s 80P without filing returned of income - AO power to entertain the claim, if not made in the return of income - HELD THAT:- As there is no dispute regarding such restrictions of power of AO, however, being Appellate Authority, such claim of assessee which is emanated from the record of lower authorities can be entertained and admitted by the appeal authorities - we find that such claim was raised by the assessee before AO, therefore, facts related to the issue is emanating from the record of lower authorities, thus, the claim of assessee is admitted.
In the case of Prathamika Krishi Pattina, Sahakara Sangha Ltd. [2022 (6) TMI 1464 - ITAT BANGALORE] held that provision of Section 80AC which deals with the denial of deduction in respect of certain provision of Chapter VIA, if a returned of income is not filed by assessee, it was held that such provision do not apply to the claim of deduction u/s 80P.
In the case of Krushi Vibhag Karmachari Vrund Sahakari Pat Sanstha Maryadit [2022 (10) TMI 348 - ITAT NAGPUR] also held that making of claim in return of income u/s 80A(5) is directory and the authorities below were not justified in rejecting the claim of assessee u/s 80P.
Thus keeping in view that the nature of deduction and quantum was not disputed by AO, so direct the AO to allow deduction u/s 80P(2)(a)(i) and 80P(2)(d) as the case may be. Appeal of the assessee is allowed for statistical purposes.
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2023 (10) TMI 1377
Seeking grant of Regular bail - Money Laundering - bail sought on medical grounds - applicant have argued that the applicant herein is 'sick' and 'infirm', and thus, should be granted regular bail in the present ECIR - twin conditions u/s 45 of PMLA satisfied or not - HELD THAT:- A Co-ordinate Bench of this Court in case of Kewal Krishan Kumar v. Enforcement Directorate [2023 (3) TMI 746 - DELHI HIGH COURT], while dealing with a case wherein regular bail had been sought under PMLA on medical grounds, had analyzed as to who would qualify as a 'sick' or 'infirm' person under the proviso to Section 45 of PMLA, which is also analogous to the proviso under Section 437 of Cr.P.C.
Further, a Co-ordinate Bench of this Court in Sanjay Jain (in JC) v. Enforcement Directorate [2023 (6) TMI 1324 - DELHI HIGH COURT], while relying upon the observations in case of Kewal Krishan Kumar, had also observed that power to grant bail on medical grounds under PMLA is discretionary and must be exercised in a judicious manner.
Importance of Right to Medical Treatment of the Prisoners - HELD THAT:- There is no denying that the act of preserving health of a prisoner/undertrial is one of the rights of the prisoners as interpreted by various judgments in India as well as in International Law. The prisoners in jail have acceptable medical infrastructure in consonance with the duty and legal obligation of the State to provide access to medical care for all prisoners and under trials - The jurisprudence of medical care and attention to the prisoners mandates that timely medical care must be available to all undertrials/ prisoners, and in appropriate cases, timely medical care includes regular access to specialized diagnostic care or post surgery care etc. which should be made available without interruption.
This Court is of the opinion that all the basic medical facilities have been provided to the applicant in the jail dispensary itself and as far some other specialized activities are concerned, the same have been taken care of by the order dated 04.09.2023 passed by this Court which has been discussed in preceding paragraph. In any case, the report of the Medical Board of AIIMS has suggested that the applicant can be treated on an outpatient basis at any of the jail referral hospitals - this Court does not wish to comment on whether the fall was intentional to seek bail as suggested by the respondent or whether it was actual as pleaded by the applicant, since this Court is not solely relying upon only one incident to decide the present bail application.
Right of Accused to Medical Treatment in Custody: Duty of The Court - HELD THAT:- This Court has already discussed in extenso the present medical condition of the applicant and the fact that he does not even require hospitalization. There is no denying the fact that the applicant has undergone about five surgeries in the past, however, as on date, he is recovering in the jail itself and as per the report of AIIMS, he is only required to follow the medical and rehabilitation protocols as suggested to him and supplement the same by regular exercise and physiotherapy. It is also important to note that to address the issue that certain rehabilitation protocols cannot be followed by the applicant owing to non-availability of necessary equipment in jail, this Court has already directed vide order dated 04.09.2023 that the applicant be taken to VNA Hospital for rehabilitation sessions twice a week.
In the present case, the attention of this Court was drawn to the report dated 03.10.2023 prepared by Senior Medical Officer of Tihar Jail in which it was mentioned that as per the directions issued vide order dated 04.09.2023 by this Court, the applicant was being regularly taken to VNA Hospital for follow-up and physiotherapy sessions. It was also informed that the applicant was being kept in the jail dispensary and was under constant follow-up from doctors on duty as well as jail visiting specialists. It is also important to consider that the Medical Board of AIIMS, New Delhi had suggested that the applicant may be taken to any of the Jail Referral Hospital for periodic follow-ups and he need not be admitted in any hospital.
Medical Facilities and Policies in Delhi Prisons - HELD THAT:- This Court notes that while the medical facility in Delhi provides both primary medical care and provision of medical services in prison, the orders dated 10.02.2011 and 27.06.2022 contain guidelines that streamline the outside OPD and referrals which provides an exhaustive list of measures which aim to attain the goal of preserving the health of prisoners.
Right of Accused to receive Medical Treatment vs. Right of Prosecuting Agency to Investigate Fairly - HELD THAT:- The allegations against the present applicant in the present FIR have been that he was one of the main conspirators and a key player in the formulation of the excise policy and its exploitation later, and was also involved in the formulation of a super cartel between the manufacturers, wholesalers and retailers. The applicant had allegedly earned huge profits of around Rs. 192 crores against meagre investment of Rs. 15 crores, in his firm M/s. Indo Spirits which is the proceeds of crime. As regards the conduct of applicant, it is the case of respondent that the applicant had not cooperated during the investigation and had not provided the relevant details, and on his behest, his counsels had also made attempts to influence the witnesses, who were the employees of applicant, who had been called for investigation by the respondent. The applicant had allegedly also destroyed the evidence i.e. his mobile phone at least four times at the time of alleged scam being exposed in public - while the applicant‟s right to healthcare and medical treatment is a fundamental consideration, it cannot be allowed to overshadow the pressing need to investigate fairly and ensure that due legal processes are followed.
Thus, this Court is of the opinion that the applicant is not suffering from any life threatening condition or sickness or infirmity which involves danger to his life and for which treatment cannot be provided to the applicant in jail - there are no grounds to enlarge the applicant on regular bail in the present ECIR.
Bail application dismissed.
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2023 (10) TMI 1376
TP adjustment - imputing interest on outstanding receivables from AEs - HELD THAT:- There has to be a proper inquiry by the ld TPO by analyzing the statistics over a period of time to discern a pattern which would indicate that vis-a-vis the receivables for the supplies made to an AE, the arrangement reflects an international transaction intended to benefit the AE in some way. On perusal of the orders of the Tribunal in assessee’s own case for earlier years, this aspect of the decision Kusum Healthcare [2017 (4) TMI 1254 - DELHI HIGH COURT] had not been addressed in those years. Further whether the ld TPO had examined the pattern of receivables from the AE by the assessee is also not discernable. Hence, we are in agreement with the ld DR in principle on this issue.
But we find that the AR had also made an alternative argument that assessee had already recovered alleged short fall on account of delayed receivables by way of excess service income received from its AE thereby obviating requirement for any further adjustment on account of notional interest on delayed receivables.
The aforesaid working, in our considered opinion, requires factual verification of the ld AO/ TPO. Hence, we deem it fit to restore the entire issue in dispute to the file of the ld AO/ TPO to consider the applicability of the decision of Kusum Healthcare (supra) in its true spirit vis a vis the pattern followed by the assessee and also alternative argument made by the ld AR with regard to the aforesaid workings and decide the entire issue in accordance with law.
AR also made an alternative argument with regard to the adoption of LIBOR +200 basis points as against 400 basis points by placing reliance on certain decisions. The ld AO/ TPO is also directed to examine this alternative argument of the ld AR while deciding this issue. Accordingly, ground Nos. 3 to 5 raised by the assessee are allowed for statistical purposes.
Disallowance of deduction u/s 80G - donations made to various eligible institutions by the assessee - HELD THAT:- It is not in dispute that contributions made by the assessee are made to eligible institutions which are enjoying exemption u/s 80G - The fact that those contributions were made only to eligible institutions are not in dispute before us.
We find that all the institutions listed in the tabulation are enjoying exemption u/s 80G of the Act and accordingly, assessee would be entitled for deduction u/s 80G of the Act thereon, irrespective of the fact that it is made as part of CSR obligations. The assessee in the instant case had duly complied the provisions of Companies Act, 2013 read with CSR rules thereon and as per the provisions of the Income Tax Act had also voluntarily disallowed the CSR expenditure while computing the taxable income. Since, the donee institutions are eligible institutions enjoying exemption u/s 80G assessee has claimed deduction u/s 80G of the Act which is also provided in the statute itself to the assessee. Hence, denial of deduction u/s 80G of the Act to the assessee would result in gross injustice. We direct the ld AO to grant deduction u/s 80G to the assessee. Accordingly, the ground No. 6 to 6.6 raised by the assessee are allowed.
Disallowance of employees contribution to PF and Labour Welfare fund (LWF) - HELD THAT:- It is not in dispute that the employees’ contribution to provident fund and LWF were deposited by the assessee to the Government account beyond the due dates prescribed under the respective acts but well before the date of filing the return of income. We find that the recent decision of Checkmate Services Pvt. Ltd Vs. CIT [2022 (10) TMI 617 - SUPREME COURT] decided issue in favour of revenue.
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2023 (10) TMI 1375
Pre-litigation Mediation and Settlement - Order VII, Rule 11 of the Code of Civil Procedure, 1908 - HELD THAT:- In the present case, it is an accepted fact that an urgent interim relief has been prayed for and the condition that the plaint "contemplates" an urgent interim relief is satisfied. Therefore, the impugned judgment/order of the Delhi High Court, which upholds the order of the District Judge (Commercial Court)-01, South District at Saket, New Delhi dated 06.02.2023, rejecting the application under Order VII, Rule 11 of the Code, is correct and in accordance with law.
When a plaint is filed under the CC Act, with a prayer for an urgent interim relief, the commercial court should examine the nature and the subject matter of the suit, the cause of action, and the prayer for interim relief. The prayer for urgent interim relief should not be a disguise or mask to wriggle out of and get over Section 12A of the CC Act. The facts and circumstances of the case have to be considered holistically from the standpoint of the plaintiff. Non-grant of interim relief at the ad-interim stage, when the plaint is taken up for registration/admission and examination, will not justify dismissal of the commercial suit under Order VII, Rule 11 of the Code; at times, interim relief is granted after issuance of notice. Nor can the suit be dismissed under Order VII, Rule 11 of the Code, because the interim relief, post the arguments, is denied on merits and on examination of the three principles, namely, (i) prima facie case, (ii) irreparable harm and injury, and (iii) balance of convenience. The fact that the court issued notice and/or granted interim stay may indicate that the court is inclined to entertain the plaint.
The proposition that the commercial courts do have a role, albeit a limited one, should be accepted, otherwise it would be up to the plaintiff alone to decide whether to resort to the procedure under Section 12A of the CC Act. An `absolute and unfettered right' approach is not justified if the pre-institution mediation under Section 12A of the CC Act is mandatory, as held by this Court in PATIL AUTOMATION PRIVATE LIMITED AND ORS VERSUS RAKHEJA ENGINEERS PRIVATE LIMITED [2022 (8) TMI 1494 - SUPREME COURT] - The words `contemplate any urgent interim relief' in Section 12A(1) of the CC Act, with reference to the suit, should be read as conferring power on the court to be satisfied. They suggest that the suit must "contemplate", which means the plaint, documents and facts should show and indicate the need for an urgent interim relief.
The present special leave petition is dismissed.
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2023 (10) TMI 1374
Rejection of plaint under Order VII Rule 11(d) for non-compliance of Section 12A of the Commercial Courts Act, 2015 - suit for recovery of arrears of rent with interest - whether the learned DJ could have dismissed the suit only on the ground that the appellant has not complied with Section 12-A of the CCA? - HELD THAT:- It is settled law that that in terms of the judgment Patil Automation Pvt. Ltd. [2022 (8) TMI 1494 - SUPREME COURT], the compliance of Section 12-A of the CCA is mandatory unless urgent relief is contemplated. A notification has been issued by the Government of India on July 03, 2018 by which the Central Government has made rules in respect of Commercial Courts (Pre-Institution of Mediation and Settlement) Rules, 2018 as contemplated under sub-section 21A read with sub-section (1) of Section 12-A of the CCA.
The sub-section 2 of Section 12-A mandate the Central Government may by notification authorise the authorities constituted under the Legal Services Authorities Act, 1987 for the purposes of Pre-Institution Mediation - In the present case, the appellant has not made his claim in terms of the notification of July 03, 2018 before the District Legal Services Authorities (DLSA) but had approached the DHCMCC(S) which held the proceedings on three occasions and the defendant/respondent despite service did not appear, resulting in Non-starter report being submitted by the DHCMCC. This report was not accepted by the learned DJ as the report is not that of DLSA.
The issue which falls for consideration is whether the learned DJ was right in rejecting the plaint only on the ground that the appellant has approached DHCMCC(S) and not DLSA, by invoking the provisions of Order VII Rule 11(d). It is true that the provisions of the Section 12-A of the CCA specifies Pre-Institution Mediation as mandatory, in the sense that any litigation must be preceded by an attempt on the part of the parties to settle their inter se dispute, but the fact that the appellant had invoked the process of mediation before the DHCMCC(S) under the aegis of the Delhi High Court and the defendant/respondent did not appear in the proceedings, resulting in a Non-starter report would surely be construed to mean that an attempt has been made by the appellant to settle his dispute with the defendant/respondent, amicably which failed.
So, the DHCMCC(S) being a court-annexed mediation centre though under the Mediation Act, 2023 and not under the CCA Act, we are of the view that there has been a compliance of the spirit underlying Section 12A of the CCA. The issue can be seen from another perspective as the respondent had neither appeared before the DHCMCC(S) nor before the learned District Judge, despite service, the likelihood of effective pre-litigation mediation to be undertaken under the aegis of DLSA is highly unlikely as the respondent/defendant will not appear making it a futile exercise.
The impugned order/judgment dated May 15, 2023 rejecting the plaint under Order VII Rule 11(d) is set aside - Appeal allowed.
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2023 (10) TMI 1373
Assessment u/s 153A - Addition u/s 68 - search conducted u/s 132 of the Act in any of the business premises of the assessee company or not? - main grievance of the assessee by way of these grounds is that since there was no search conducted on the assessee company, nor any Panchnama was prepared in its name, the order of assessment, passed u/s 153A of the Act, is bad in law - HELD THAT:- As per this Panchnama the warrant is in the case of M/s Kansal Singla & Associates. The details and ownership of the place of search are M/s Kansal Singla & Associates, SCO 80-81, 4th Floor, Sector 21-C, Chandigarh. It is seen that even at APB—346, which is a copy of the list/inventory of books of account/documents found and seized/impounded, the address has been shown as “SCO 80-81, 4th Floor, Sector 21-C, Chandigarh”. So is also the case at page 347, which is a continuation of the list/inventory.
The above apart, in this Panchnama, the assessee company, i.e., M/s Evershine Resorts Private Limited has nowhere been named.
However, despite the above discrepancies, it is seen that in the Search Warrant, which has been reproduced hereinabove, the name of the assessee company has been clearly mentioned. This being so, the ld. CIT(A) is correct in observing, that the Warrant of Authorization u/s 132(1) of the Act was issued in the name of the assessee on 16.02.2018. It was in view of this, that the ld. CIT(A) held the AO to be justified in initiating assessment proceedings u/s 153A of the Act, since the assessee was covered under the provisions of Section 132(1).
Assessee has not been able to controvert the above factual position, which is patent on record. Therefore, finding no merit therein, Ground Nos. 2 and 3 raised by the assessee before us are rejected.
Addition u/s 68 - Identity and credit worthiness of the persons from whom the amounts were received by the assessee and also the genuineness of the transactions - We find that despite the Deviation Note, it was only on the basis of the reiteration of the Appraisal Report by the DDIT on 27.12.2019, that the AO made the addition which has been confirmed by the ld. CIT(A). We find that the assessee is correct in contending that the ld. CIT(A) has erred in upholding the addition of Rs.10 lacs received by the assessee from Bihari Lal Deshraj. Accordingly Ground No.4 is accepted and the addition is deleted.
Addition of sum received from M/s Om Prakash & Sons - AO had made the addition of all the credits in the bank account - As per the assessee, these additions were made without considering each credit separately on merits, on the plea that the purpose of utilization of the funds had not been explained by the assessee - HELD THAT:- Evidently, neither of the authorities below found the evidence furnished by the assessee in this regard to be unsatisfactory. Had it been otherwise, an investigation could have been ordered under Sections 133(6) or 131 of the Act. However, this was not done. Moreover, to begin with, the AO, as evident from the Deviation Note, did not intend to make any addition, having been satisfied as to the explanation of the sources and it was only on the directive of the third party that the addition was ordered - no merit in the confirmation of the addition of Rs.40 lacs, received by the assessee from M/s Om Prakash & Sons, the order of the ld. CIT(A) in this regard is reversed and the addition is deleted
Addition of sum received from Shri Baldev Singh - AO made addition of the credit entries in the bank without considering each credit separately on merit and on the observation that the purpose and utilization of the funds was not explained by the assessee - HELD THAT:- CIT(A) did not afford any chance to the assessee to produce the complete bank account statement before him, these documents are necessary to decide the controversy regarding the sustainability of the addition sum received by the assessee from Shri Baldev Singh in a just and proper manner. The Department has also not controverted this. Accordingly, considering the said documents, which are allowed to be raised as additional evidence, we find that the addition of Rs.17 lacs has been wrongly confirmed by the ld. CIT(A). Accordingly, this addition is deleted and Ground No.6 is accepted.
Loans and advances of M/s Dharma Wires Pvt. Ltd - AO has made addition without considering the merits of the documents furnished before him, just by observing that the purpose and utilization of the funds did not stand explained by the assessee. As to how this was so has not been delineated in the assessment order and the addition has been made simply as a part of the entire credit entries in the bank - CIT(A) also confirmed the addition by just observing, without proving as to how it was so, that the assessee was not able to establish the genuineness and credit worthiness. Here again, the documents furnished by the assessee were not even mentioned in the impugned order, what to talk of deliberating on the merits of each of these documents. AO has made addition without considering the merits of the documents furnished before him, just by observing that the purpose and utilization of the funds did not stand explained by the assessee. As to how this was so has not been delineated in the assessment order and the addition has been made simply as a part of the entire credit entries in the bank,
Also seen that no doubt about either the credit worthiness of the lender, or the genuineness of the transaction, is evincible, either from the assessment order, or from the order passed by the ld. CIT(A) and not only this, no doubt with regard thereto stands raised, in as much as no enquiry/investigation was initiated by either of the authorities below. Moreover, it also stands irrefuted that the advance was returned by the assessee company to the lender in the next year, through banking channels. Thus the addition was but as a result of non-application of mind by the AO, rather on the mere dictat of a third party, i.e., the ADIT.
Addition u/s 68 - AO, besides observing that the purpose and utilization of the funds was not explained by the assessee, held that the assessee was a shell company, as it does not have any profit earning apparatus and that the books of account were not produced for verification - CIT(A) deleted part addition - HELD THAT:- As observed that the submissions and documents furnished by the assessee during the appellate proceedings had also been forwarded to the AO for remand report; that in the Remand Report also, the AO had not even discussed the documentary evidences furnished by the assessee in support of the bank credits on merits, let alone pointing out any defect in the same. It was observed that in view of these facts and after making independent perusal of the documents furnished by the assessee, it had been noted that the assessment order was non speaking and mechanical in nature and had been passed without discussing the merits of the documents. It was observed that there was no direct or indirect evidence pointed out by the AO before making such addition. It was observed that therefore, after considering the merits of the case and analyzing the credits and the strength of the documentary evidence, it had been observed that there was no justification in such addition made in the hands of the assessee u/s 68 - It was, on these observations that the ld. CIT(A) deemed it appropriate to delete the addition to the extent of Rs.4,05,00,000/-.
However, surprisingly, the above detailed discussion with regard to the addition to the extent of Rs.4,05,00,000/- was not found appropriate to be applicable to the remaining addition of Rs.77 lcs also, which addition was confirmed by the ld. CIT(A). This addition of Rs.77 lacs, as discussed in the preceding paragraphs, has been found by us also to be unsustainable. The discussion with regard thereto is not being repeated here. The assessee, to reiterate, has presented ample documentary evidence in support of the credits to the extent of Rs.77 lacs, which have not been considered by the ld. CIT(A). This, in our considered opinion, is unsustainable in law and on facts. Therefore, the addition of Rs. 77 lacs is also deleted. Ground No.8 is accepted.
Disallowance of loss - company had failed to produce bills and vouchers of the expenses claimed, due to which, the genuineness of the expenses claimed did not stand proved - HELD THAT:- Seen that as per computation loss of Rs.5000/- has been shown. The same is the position as per the Profit & Loss Account (APB 4). In the notice (APB 20) dated 07.10.2019, at point No.12, the AO had mentioned that the books of account and other documents were seized during the search. The assessee company submitted the books of account before the AO vide letter dated 21.01.2022, as is available at APB 113. The same were also seized in the hard disk, as mentioned in the Panchnama. Therefore, it cannot be said that books of account and other documents were not produced. The issue of the company not being a shell company has been deliberated upon, in extenso, in the preceding paragraphs.
However, it has not been disputed that the bills and vouchers of the expenses claimed had not been produced. Therefore, the addition made is hereby sustained. Ground No.9 is rejected.
Enhancement of the income of the assessee company by CIT(A) - Addition u/s 251(1)(a) - HELD THAT:- The Explanation to Section 251(1) states, inter-alia, that in disposing of an appeal, the Commissioner (Appeals) may consider and decide any matter arising out of the proceedings in which the order appealed against was passed, notwithstanding that such matter was not raised before the Commissioner (Appeals) by the appellant. Thus, it is evident that the ld. CIT(A), as per these provisions, has power to revise only those matters which were considered by the AO and which are arising out of the proceedings in which the order appealed against was passed. In the case at hand, the issue of forfeiture of advance amount was nowhere considered by the AO in the assessment order. As such, it was a new source of income which was brought to tax by the ld. CIT(A) by making enhancement of Rs.40 lacs and that too, without any prior notice to the assessee. This, evidently, in our considered opinion, is not countenanced u/s 251(1) of the Act. Therefore, the grievance of the assessee in this regard is justified.
Unexplained cash credit - assessee did not establish its genuineness during the assessment proceedings - Assessee company treated as a shell company - As been stated before us on behalf of the assessee, that in reply to RTI applications to the CBDT, Ministry of Corporate Affairs and SEBI, it was admitted that there was no definition of ‘shell company’ in India. Further, apropos the AO’s Remand Report, where the AO referred to compilation of data base on shell companies, claiming three lists, i.e., Confirmed List (16537), Derived List (16739) and Suspect List (80670), ordered by SFIO. The AO claimed that the names of such companies were removed from the Register by the Registrar of Companies. It has been contended on behalf of the assessee, and not rebutted by the Department before us, that the name of the assessee did not figure in any of these lists, as the assessee is an active company and none of the Directors of this company have been barred. Also, the AO had not issued any Show Cause Notice to the assessee as to why the assessee company should not be treated as a shell company. Thus finding no merit whatsoever in the grounds raised by the Department, these grounds are rejected.
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2023 (10) TMI 1372
Seeking grant of bail - Unnatural death of a lady - proceeding has been started under Sections 304-B/34 and 120-B of the Indian Penal Code - Charges have been framed and trial has been commenced without the husband being arrested and it is submitted on behalf of the State that he is absconding - HELD THAT:- The question of grant of bail to a co-accused person cannot made dependent upon surrender of another accused who is described as the main accused person in this case.
The imposition and subsequent adhering to the condition of surrender of the husband of the deceased would not be necessary for grant of bail to the appellant - the impugned order modified and it is directed that the appellant may be released on bail in terms of the order(s) of the High Court but the condition which requires prior surrender of husband of the deceased should not be insisted upon for enlarging the appellant on bail.
Appeal allowed.
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2023 (10) TMI 1371
Murder - Death due to poisoning - onus to prove - Failure on the part of the appellant-convict in offering any plausible explanation in his further statement recorded u/s 313 of CrPC - shifting the burden on the accused husband to explain what had actually happened on the date his wife died - whether the High Court committed any error in passing the impugned judgment and order? - HELD THAT:- What lies at the bottom of the various rules shifting the evidential burden or burden of introducing evidence in proof of one's case as opposed to the persuasive burden or burden of proof, i.e., of proving all the issues remaining with the prosecution and which never shift is the idea that it is impossible for the prosecution to give wholly convincing evidence on certain issues from its own hand and it is therefore for the accused to give evidence on them if he wishes to escape. Positive facts must always be proved by the prosecution. But the same rule cannot always apply to negative facts. It is not for the prosecution to anticipate and eliminate all possible defences or circumstances which may exonerate an accused. Again, when a person does not act with some intention other than that which the character and circumstances of the act suggest, it is not for the prosecution to eliminate all the other possible intentions.
A manifest distinction exists between the burden of proof and the burden of going forward with the evidence. Generally, the burden of proof upon any affirmative proposition necessary to be established as the foundation of an issue does not shift, but the burden of evidence or the burden of explanation may shift from one side to the other according to the testimony. Thus, if the prosecution has offered evidence which if believed by the court would convince them of the accused's guilt beyond a reasonable doubt, the accused is in a position where he should go forward with counter-vailing evidence if he has such evidence. When facts are peculiarly within the knowledge of the accused, the burden is on him to present evidence of such facts, whether the proposition is an affirmative or negative one - although not legally required to produce evidence on his own behalf, the accused may therefore as a practical matter find it essential to go forward with proof. This does not alter the burden of proof resting upon the prosecution
Prima facie in the context of section 106 of Evidence Act - HELD THAT:- Section 106 of the Evidence Act would apply to cases where the prosecution could be said to have succeeded in proving facts from which a reasonable inference can be drawn regarding death - The presumption of fact is an inference as to the existence of one fact from the existence of some other facts, unless the truth of such inference is disproved - In the case on hand it has been established or rather proved to the satisfaction of the court that the deceased was in company of her husband i.e., the appellant-convict at a point of time when something went wrong with her health and therefore, in such circumstances the appellant-convict alone knew what happened to her until she was with him.
Failure on the part of the appellant-convict in offering ant plausible explanation in his further statement recorded u/s 313 of CrPC - HELD THAT:- The appellant-convict was expected to lead some evidence as to what had transpired at the Sanjay Gandhi Hospital. He has maintained a complete silence. It is only the appellant-convict who could have explained in what circumstances and in what manner he had taken his wife to the Sanjay Gandhi Hospital and who attended his wife at the hospital. If it is his case, that his wife was declared dead on being brought at the hospital then it is difficult to believe that the hospital authorities allowed the appellant to carry the dead body back home without completing the legal formalities.
Even where there are facts especially within the knowledge of the accused, which could throw a light upon his guilt or innocence, as the case may be, the accused is not bound to allege them or to prove them. But it is not as if the section is automatically inapplicable to the criminal trials, for, if that had been the case, the Legislature would certainly have so enacted - more than a prima facie case to enable the prosecution to invoke Section 106 of the Evidence Act and shift the burden on the accused husband to explain what had actually happened on the date his wife died.
These appeals reminds of what this Court observed in the case of Dharam Das Wadhwani v. State of Uttar Pradesh [1974 (3) TMI 124 - SUPREME COURT] “The rule of benefit of reasonable doubt does not imply a frail willow bending to every whiff of hesitancy. Judges are made of sterner stuff and must take a practical view of legitimate inferences flowing from evidence, circumstantial or direct.” The role of courts in such circumstances assumes greater importance and it is expected that the courts would deal with such cases in a more realistic manner and not allow the criminals to escape on account of procedural technicalities, perfunctory investigation or insignificant lacunas in the evidence as otherwise the criminals would receive encouragement and the victims of crime would be totally discouraged by the crime going unpunished. The courts are expected to be sensitive in cases involving crime against women.
Both the appeals fail and are hereby dismissed.
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2023 (10) TMI 1370
Seeking grant of bail - opening bank account in the name of the villagers by using documents given by the villagers and forging their signatures - money deposited in such bank accounts was channelized as share capital in M/s. Prime Ispat Limited through shell companies - application is a lady suffering from various ailments - twin requirement of Section 45 of PMLA satisfied or not - HELD THAT:- It is not in dispute that the FIR was registered on 19.02.2010 whereas the respondent filed a complaint arraying the applicant as accused in ECIR on 04.01.2021 i.e. after 10 years. From the summons issued to the applicant, it is quite vivid that she was permitted to appear through an authorized person and it cannot be said that she did not cooperate in the investigation. According to the proviso appended to Section 45 of the PMLA Act, a woman suffering from certain ailments may be granted anticipatory bail.
The decision cited by learned counsel for the respondent states the twin conditions of Section 45 of the PMLA Act are to be satisfied but at the same time, the judgment passed by the Hon'ble Supreme Court in the matter of SATENDER KUMAR ANTIL VERSUS CENTRAL BUREAU OF INVESTIGATION & ANR. [2022 (8) TMI 152 - SUPREME COURT] cannot be lost sight of as the applicant is a lady suffering from various ailments and she cooperated in the investigation of the matter and other co-accused persons against whom similar allegations were made, have already been granted anticipatory bail by the Hon'ble Supreme Court and by this Court, therefore, in opinion of this Court, the present is a fit case to extend the benefit under Section 438 of Cr.P.C. to the applicant.
It is directed that in the event of arrest of the applicant in connection with the aforesaid offence, she shall be released on anticipatory bail on her furnishing a personal bond for a sum of Rs. 50,000/- with one surety in the like sum to the satisfaction of the arresting officer and she shall abide by the conditions imposed - bail application allowed.
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2023 (10) TMI 1369
Grant of bail - diversion of funds or not - accusation is that the applicant defrauded the bank by declaring false value of stock offered as collateral - bail sought on medical grounds - Section 447 of the Companies Act, 2013 - HELD THAT:- The Forensic Audit Report which SFIO is relying upon indicates that JACPL has faced genuine business losses and that there is no financial irregularities. It appears that there is no independent stock audit done by SFIO. The SFIO has arrived at value of the stock based on the statement of the store keepers and there are some substance in the contention of learned senior advocate for the applicant that SFIO did not carry out any independent forensic analysis relating to valuation of the stock.
So far as the accusation that Rs. 550 crores have gone to ‘Jagat Overseas’ from the account of the company which amounts to siphoning is concerned, it appears that in the financial year 2014-2015 Rs. 522.60 crores were transferred from ‘Jagat Overseas’ account to the account of JACPL and Rs. 552.41 crores was received back from JACPL to ‘Jagat Overseas’. Prima facie, this may be a transaction squaring up of the amount credited and debited. In prima facie opinion, there is a reasonable ground to believe that the offence punishable under Section 447 of the said Act may not be attracted in the present case.
The applicant is 63 years of age. It is thus seen that the applicant needs constant medical treatment. No doubt the same is available and provided to the applicant at Sir J. J. Hospital and in prison hospital. However, there are no hesitation in opining that the applicant needs constant medical attention considering his age and ailment. The age and medical condition of the applicant is one of the circumstance which is taken into consideration for enlarging the applicant on bail.
Though it is stated that the applicant is willing to furnish a surety having valuation of upto Rs. 5 crores for the purpose of releasing him on bail, on behalf of the applicant, learned counsel on instructions of the applicant through his son who is personally present in the Court submitted that a sum of Rs. 5 crores will be deposited with the Special Court by way of Fixed Deposit in the name of the concerned Registrar/ Superintendent of the Special Court within a period of two months from the date of the applicant’s enlargement on bail. The statement is accepted as an undertaking to this Court. The affidavit to that effect be filed by the applicant in this Court before his release. Registry to accept. The said deposit will abide by the orders passed by the Special Court.
The applicant is in custody for more than 18 months with no possibility of the trial concluding any time soon. The investigation is complete. The charge-sheet has been filed. There are no criminal antecedents reported against the applicant. The applicant does not appear to be a flight risk. Further incarceration will only be by way of a pre-trial punishment.
The applicant- Sant Lal Aggarwal shall be released on bail on his furnishing P.R. Bond of Rs. 1,00,000/- with one or more local sureties in the like amount and subject to fulfilment of conditions imposed.
Bail application allowed.
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2023 (10) TMI 1368
The Gujarat High Court heard a case regarding the taxation of lease, tenancy, or easement under the Central Goods and Service Tax Act, 2017. The petitioner argued that these activities should not be considered as supply of services. The court issued a notice returnable on 07.12.2023 and granted ad-interim relief.
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2023 (10) TMI 1367
Seeking cancellation of Regular Bail granted - gross misuse of concession of bail - sufficient material gathered by the prosecution to indicate the involvement of Respondent No. 1 in a criminal conspiracy hatched for killing his wife or not - HELD THAT:- The unusual and surprising events that have happened post the grant of bail to Respondent No.1, do make out a case for recalling the witnesses for an effective, fair, and free adjudication of the trial. This Court is vested with vast and ample powers to have such recourse not only under Article 142 of the Constitution but also under Section 311 of the Code of Criminal Procedure, 1973, be it on the request of the prosecution or suo moto. Such Constitutional or statutory power is not limited by any barriers like the stage of inquiry, trial, or other proceeding. A person can be called and examined though not summoned as a witness, or can be recalled, or reexamined so as to throw light upon the imputations. Section 311 CrPC, of course, does not intend to fill the lacunae in the prosecution’s case and cause any serious prejudice to the rights of an accused. The exercise of power under this provision is intended to meet the ends of justice and to gather overwhelming evidence to scoop out the truth.
In the case at hand, the family members of the Deceased are the most crucial witnesses to test the veracity of the allegations levelled by the prosecution. Their stand in the examinationinchief is diametrically opposite to the one in the cross- examination. The fact that the parents and sister of the Deceased have resiled from their earlier standpoint where they had been found to be agitating vigorously before different forums since the year 2019, implores us to invoke our Constitutional powers under Article 142 read with Section 311 CrPC and direct their recalling for a fresh crossexamination after ensuring a congenial environment, free from any kind of threat, psychological fear, or any inducement.
This is a case fit for recalling the witnesses (PW1, PW4 and PW5) for their further crossexamination to reach an effective decision in the subject trial.
The impugned order dated 12.08.2020 is set aside and the bail granted to Respondent No. 1 is hereby cancelled - Appeal allowed.
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