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Showing 141 to 160 of 1817 Records
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2013 (11) TMI 1682
Eligible for the benefit of DTAA between India and UAE - Held that:- CIT(A) erred by confirming the order of the assessing officer when the assessee has submitted the copy of the certificate from the Min. of Finance and Industry of UAE to the effect that the assessee is qualified in terms of the DTAA between India and UAE as resident in the United Arab Emirates to enjoy the benefit of the said agreement, for the fiscal year 1997-98, pursuant to the provisions of Article 8 of the DTAA. In view of the above discussions, we set aside the impugned order of the learned CIT(A) and direct the assessing officer to give relief / benefit of DTAA with UAE
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2013 (11) TMI 1681
Issues Involved:
1. Deletion of income addition by estimating higher values after rejecting books of account.
2. Justification of rejection of books of account u/s 145.
3. Allowance of business expenses.
4. Allowance of depreciation.
5. Allowance of loss pertaining to hotel business.
Summary:
1. Deletion of Income Addition:
The Revenue's appeal contested the deletion by the CIT(A) of the income addition made by the A.O. by estimating higher profits from various projects after rejecting the books of account. The A.O. had estimated profits for projects such as Gopala, Kukreja, Ganga Tower I, and Ganga Tower II at higher values. The CIT(A) held that the methods of accounting followed by the assessee were correct and that the A.O. was not justified in rejecting the book results. The CIT(A) found that the income estimated by the assessee from different projects was fair and reasonable.
2. Justification of Rejection of Books of Account u/s 145:
The A.O. rejected the books of account u/s 145, citing inconsistencies in the method of accounting and non-compliance with revised Accounting Standard 7 (AS-7). The CIT(A) held that the project completion method is a recognized method for builders and that the assessee consistently followed this method for new projects started after A.Y. 2001-02. The CIT(A) also noted that AS-7 is applicable to contractors, not builders, and thus the A.O.'s rejection of the books was not justified.
3. Allowance of Business Expenses:
The A.O. had disallowed business expenses of Rs. 36,37,375/- after rejecting the book results. The CIT(A) allowed these expenses, stating that the A.O. did not establish that the expenses were either bogus or not incurred for business purposes. Since the rejection of book results was not justified, the CIT(A) allowed the business expenses claimed by the assessee.
4. Allowance of Depreciation:
The A.O. disallowed the depreciation claim of Rs. 55,19,141/- for the hotel business, questioning the use of assets. The CIT(A) allowed 50% of the depreciation amounting to Rs. 27,59,570/-, based on evidence that the hotel business commenced during the year and the assets were put to use for less than 180 days.
5. Allowance of Loss Pertaining to Hotel Business:
The CIT(A) allowed the assessee's claim for a loss of Rs. 8,18,327/- pertaining to the hotel business, recognizing that the hotel business commenced during the year under consideration. This decision was upheld as it was consequential to the acceptance of the commencement of the hotel business.
Conclusion:
The Tribunal upheld the CIT(A)'s order, dismissing the Revenue's appeal and confirming the deletion of income addition, allowance of business expenses, depreciation, and loss pertaining to the hotel business. The methods of accounting followed by the assessee were deemed appropriate and consistently applied.
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2013 (11) TMI 1680
Levy of penalty u/s 272A(2)(k) - Late filing of TDS return - HELD THAT:- the penalty under section 272A(2)(k) of the Act merits to be restricted to the date of deposit of tax at source which admittedly is beyond the due date of filing the TDS returns.
The decision in support was laid down in H.M.T. Ltd. Tractors Division Vs CIT [ 274 ITR 544 (P&H) ] [2004 (8) TMI 50 - PUNJAB AND HARYANA HIGH COURT] wherein it has been held that where the tax at source had been paid in time and the necessary return in respect thereof was filed in time with the income tax department, on mere late issue of tax deduction certificate, there was no loss to the Revenue and the delay in furnishing the tax deduction certificate was merely technical or venial in nature and penalty could not be imposed. Accordingly, direction given to the Assessing Officer to recompute the penalty leviable under section 272A(2)(k) of the Act in line with our directions. The grounds of appeal raised by the assessee are, thus partly allowed.
In the result, appeal of the assessee is partly allowed.
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2013 (11) TMI 1679
TDS u/s 194C - Addition u/s. 40(a)(ia) - Held that:- The provisions of sec. 194C clearly states that the assessee is liable to deduct tax at source either at the time of credit to the account of the contractor or at the time of payment thereof, whichever is earlier. It is further provided that the said liability would arise even if the amount is credited to any other account whether called “Suspense Account” or by any other name. Hence, in our view, the assessee would be liable to deduct tax at source u/s 194C on the amount provided under the head “provision for expenses”. Hence, we reject the contentions of the assessee that the TDS provisions shall not apply to the provision for expenses.
A careful reading of the provisions of sec. 194C would show that the said section is “contract” specific and not related to the income of the assessee. Hence, this argument of the assessee also fails.
No submissions would not absolve the assessee from the TDS liability u/s 194C of the Act, since a careful reading of the provisions of sec. 194C would show that the said section is “contract” specific and not related to the income of the assessee. Hence, this argument of the assessee also fails.
It is an admitted fact that the assessee has claimed the impugned amount as deduction in the succeeding assessment year, i.e., assessment year 2008-09. Though the assessee contends that it has claimed the same on protective basis, we do not find any such observation in the assessment order which is placed in the paper book filed by the assessee. The Ld. CIT(A) has rightly pointed out that the assessee has claimed the very same amount twice, i.e., in assessment year 2007-08 and also in assessment year 2008-09.- Decided against assessee.
In the preceding paragraphs, we have held that the assessee is liable to deduct tax at source on the provision for expenses created by the assessee. It an admitted fact that the assessee herein did not deduct tax at source from the amount of provision so created. We have already rejected various contentions urged by the Ld A.R. Under these circumstances, in our view, the Ld. CIT(A) was justified in confirming the disallowance made by the Assessing Officer u/s. 40(a)(ia) of the Act. Accordingly, we uphold his order on this issue.
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2013 (11) TMI 1678
Seizure of goods - the quality of the goods ie. Supari which were in transit were better than the quality disclosed in the accompanying documents - purchasing dealer was not a registered dealer - Held that: - The seizure of the goods on the ground that they were of better quality is not a ground for seizure of the goods under the Act and the authorities are not even competent to adjudge the quality of the goods. The seizing authority has no expertise to adjudge the quality of the goods. Therefore, seizure for the reason that the Supari which was being carried was of a superior quality is not tenable in law.
The goods have also been seized for the reason that the purchasing dealer of Bihar was not registered - Held that: - genuineness of the consignor and consignee and their registration under the taxing statute are not relevant for the purposes of seizing the goods, the authorities could not have seized the goods on the above score also.
Revision allowed - decided in favor of assessee.
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2013 (11) TMI 1677
Legal Judgment Summary: Supreme Court condoned delay and granted leave in the case. (Citation: 2013 (11) TMI 1677 - SC)
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2013 (11) TMI 1676
Addition of deemed dividend u/s 2(22)(e) - Held that:- CIT(A) has rightly decided that the case of Sunil P.Mantri clearly falls u/s 2(22)(e) of the Act. However, we are inclined to accept the alternate arguments of the Ld.AR that the additions are to be restricted only to the extent of the accumulated profits of the lender concern up to March 31st of the previous years relevant to the assessment years under consideration during which the loans/advances have been made to various concerns. Therefore, as regards the additions made in the hands of Sunil P.Mantri for assessment years 2008-09 and 2009-10, we direct the AO to restrict the additions based on the accumulated profits of M/s Sunil Mantri Realty Ltd as on 31.03.2007 and 31.03.2008 respectively, corresponding to the loans/advances made for the relevant assessment years i.e., 2008-09 and 2009-10.
Deleting the additions made by the AO in respect the sums repaid by the recipient concerns to the lender company for the A.Y 2009-10, the decision of the Ld.CIT(A) restricting the additions to the extent of the accumulated profits of the lender concern, the decision of the Ld.CIT(A) that the gross rent estimated by AO @ 7% of cost of the property interest in respect of the property located at Ambey Valley, Lonawala is reasonable and the decision of the Ld.CIT(A) that the assessee is eligible for claim of deduction in respect of interest paid are upheld.
Decision of the Ld.CIT(A) resulting in the deletion of the additions made in the hands of the recipient concerns on protective basis, we are of the considered view that the Ld.CIT(A) has correctly relied on the decisions of Special Bench in the case of ACIT Vs. Bhaumik Colour P. Ltd. reported in (2008 (11) TMI 273 - ITAT BOMBAY-E ) wherein it has been held that the intention behind the provision of section 2(22)(e) is to tax dividend in the hands of share-holder. The deeming provisions as it applies to the case of loans or advances by a concern to concern in which its share-holder has substantial interest, is based on the presumption that the loans or advance would ultimately be made available to the share-holder of the concern giving the loans or advances. The intention of the legislature is therefore to tax dividend only in the hands of the share-holder and not in the hands the concern
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2013 (11) TMI 1675
Deduction 80IA - Held that:- valid reason to interfere with the findings and decision of the Commissioner of Income Tax (Appeals), as the Commissioner of Income Tax (Appeals) followed the decision of the jurisdictional High Court in the case of Velayudha Spinning Mills Ltd. (2010 (3) TMI 860 - Madras High Court ), while allowing the claim of the assessee under section 80IA of the Act on windmill. Therefore, we sustain the orders of the Commissioner of Income Tax (Appeals) in both the cases.
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2013 (11) TMI 1674
Addition u/s 41 - Held that:- Addition was made solely on the basis that said liability is more than three years, it cannot be said that the learned ITAT has committed any error in deleting the addition of ₹ 51,37,327/- made under Section 41(1) of the Act. We see no reason to interfere with the impugned judgment and order passed by the learned Tribunal
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2013 (11) TMI 1673
Deduction u/s.80IB(10) - Held that:- The main limb on which deduction was denied was for the reason that area of verandah was not excluded or exempt under section 78(3) of the Bye-laws of Kolhapur Municipal Corporation. CIT(A) following the decision of his predecessor, decided the issue in favour of assessee with regard to 19 bungalows. With regard to bungalows C5 and D5 which admittedly are more than 1500 sq.ft., but were sold to the owners of the land and profit thereof has not been the subject matter of section 80IB(10). Accordingly, no adverse view has taken by CIT(A). Coming back to the issue of built up area as per bye-laws of Kolhapur Municipal Corporation with regard to 19 bungalows mentioned above, we find that Tribunal has set aside this issue to Assessing officer stating that the Finance Act of 2004 with effect from 01/04/2005 inserted the definition of built up area at subsection 14(1) of section 80IB. The 'built up area' was defined as under:
Built up area means the inner measurements of the residential unit at the floor level including the projections and balconies as increased by the thickness of the walls but does not include common areas shared with other residential areas.Technically speaking, the definition of 'built up area' as given above will be applicable only with effect from 01/04/2005. The Honourable Supreme Court in a recent Five Judge Bench decision in the case of CIT V/s Varas International Pvt. Ltd. [2006 (2) TMI 76 - SUPREME Court ] has held that for an amendment to be construed as being retrospective, the amended provision must indicate either by terms or by necessary implication that it is to operate retrospectively. Thus we restore this issue to Assessing Officer with similar directions.
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2013 (11) TMI 1672
Issues involved: Availing wrong CENVAT credit, confirmation of interest and penalty.
Availing wrong CENVAT credit: The appellants availed CENVAT credit of duty paid on inputs wrongly to the extent of Rs. 14,56,622/- for the period July 97 to December 1999. The mistake was due to adopting the invoice value instead of duty amount for 8 entries, which was acknowledged by the appellants and the credits were reversed.
Confirmation of penalty: The challenge was against the confirmation of interest and penalty of the same amount imposed on the appellants. The Tribunal noted that the appellants, being a Public Sector Unit, had no mala fide intention in taking the excess credit unintentionally. Considering the limited number of invoices involved over a 2-year period, the penalty was set aside by extending the benefit of doubt to the appellants.
Confirmation of interest: The appellant contended that although they had taken excess credit, it was not utilized as they always maintained a balance equal to the wrong credit amount of Rs. 14,56,662/-. Citing a decision of the Hon'ble Karnataka High Court, it was argued that if the excess credit remains unutilized as a paper entry, no interest should be levied. As the factual position was not clear, the matter was remanded to the adjudicating authority to verify the appellant's claim and decide on the interest issue based on the Karnataka High Court decision.
The appeal was disposed of with the above considerations.
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2013 (11) TMI 1671
TDS u/s 194C - account of lorry booking as assessee failed to deduct TDS - Held that:- The contract of transportation was between the assessee's clients and the transporters and the assessee had mainly acted as a facilitator or as an intermediary. No tds deduction
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2013 (11) TMI 1670
Penalty imposed u/s. 271B - reasonable cause in not getting accounts audited before prescribed date as per provisions of section 44AB - Held that:- According to assessee, income pertaining to this had been credited in Profit and Loss Account after survey on account of declaration of additional income. This income has been credited much later after specified date of audit and under no circumstances, assessee could have got books of accounts audited by 31.10.2006. Assessee could not anticipate on specified date that turnover of the assessee exceeded ₹ 40 lakhs. The assessee at the relevant point of time was prevented by reasonable cause for not getting its accounts audited as per provisions of section 44AB. He was under the bonafide belief at relevant point of time that his income has not exceeded the prescribed limit as per provisions of section 44AB of I.T Act.
In view of facts and circumstances of the case, we are of the view that assessee was prevented or reasonable cause in not getting accounts audited before prescribed date as per provisions of section 44AB. Accordingly, Assessing Officer is directed to delete the penalty imposed u/s. 271B of I.T Act.
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2013 (11) TMI 1669
Levy of penalty u/s.271B - Held that:- As due to the leaving of service by the Accountant the accounts of the assessee could not be finalised in time for which there was delay in getting the audit report and finally the assessee has obtained the audit report on 16-01-2009. Further, the returned income at ₹ 8,51,340/- has been accepted by the Assessing Officer in the assessment. Considering the totality of the facts of the case, we are of the opinion that this is not a fit case for levy of penalty u/s.271B of the I.T. Act, 1961. We, therefore, set-aside the order of the CIT(A) and direct the Assessing Officer to cancel the penalty.
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2013 (11) TMI 1668
Penalty u/s 271B - not getting the accounts audited before the statutory due date - Held that:- There is no absolute default and the assessee has filed Audit report although belatedly, we are of the considered opinion that there was bonafide reasons for not getting the accounts audited before the statutory due date and therefore this is not a fit case for levy of penalty u/s.271B of the I.T. Act. In this view of the matter, we set-aside the order of the CIT(A) and direct the Assessing Officer to cancel the penalty levied u/s.271B of the I.T. Act.
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2013 (11) TMI 1667
Entitlement to deprecation at higher rate on the vehicles leased out to third parties - Held that:- Assessee engaged in the business of lease financing was entitled to higher rate of depreciation on vehicles used for hire, even when the vehicles were leased out to a third party. See I.C.D.S. Ltd. vs. CIT [2013 (1) TMI 344 - SUPREME COURT]
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2013 (11) TMI 1666
Issues involved: Central Excise Appeal u/s 35G of Central Excise Act, 1944 regarding Cenvat credit disallowance and penalty imposition.
Summary:
The Central Excise Appeal arose from a final order by the Customs, Excise & Service Tax Appellate Tribunal, which restricted the Cenvat credit to Rs. 17,982 only and did not find grounds for imposing a penalty exceeding that amount. The Tribunal noted that post-amendment in Section 78, penalties cannot be simultaneously imposed under Sections 76 and 78. The Order-in-Appeal was confirmed for service tax and an equal penalty under Section 78.
A show cause notice was issued proposing that only Rs. 17,982 of Cenvat credit was admissible, with the remaining balance disallowed. The subsequent appeal dismissal was based on the authority exceeding the show cause notice by disallowing the entire Cenvat credit for maintenance and repair services specified under Rule 6(5) of Cenvat Credit Rules.
The Tribunal determined that the appellants provided renting of immovable property services and maintenance/repair services for an area exceeding 998 sq. ft. Such services beyond 998 sq. ft. were not considered inputs services as they were not utilized for output services. However, Cenvat credit for service tax paid on maintenance services for 998 sq. ft. was deemed eligible, aligning with the original show cause notice proposal.
The department's appeal questioned the CESTAT's failure to confirm the total demand of Service Tax, interest, and penalties due to the alleged ineligible service tax credit availed by the respondents. The Court found no merit in the stated question of law and determined that the appeal did not warrant consideration due to the insignificant amount involved and the absence of any legal issues for review.
Ultimately, the Central Excise Appeal was dismissed by the Court.
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2013 (11) TMI 1665
Unexplained purchases - Held that:- It is an undisputed fact that Assessee deals in grey cloth and processed cloth and had obtained bank finance for working capital by hypothecation of the aforesaid stock. CIT(A) while deleting the addition has noted that AO has compared the value and quantity of stock of grey submitted to the bank with that of book stock but had not made comparision of processed cloth, the quantitative details of which were also submitted to the bank. He has further noted that the aggregate stock of grey cloth and processed stock for the month of June 2003 as per the books of the assessee was ₹ 91.76 lacs as against the value of stock of ₹ 93.46 lacs submitted to the bank. He has further noted that for the month of Aug to Sept 2003 the stock submitted to the bank was lower than the stock as per books which therefore suggest that stock statement submitted to the bank was incorrect. He has further noted that AO has not brought any independent evidence which can prove that Assessee has purchased grey cloth out of undisclosed sources or Assessee was in fact in possession of higher quantity of stock. Before us, the Revenue has not brought any material on record to controvert the findings of CIT(A). In view of the aforesaid facts, we find no reason to interfere with the order of CIT(A). - Decided against revenue.
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2013 (11) TMI 1664
Levy of Education Cess and Secondary and Higher Education Cess on the total excise duty leviable - Held that: - Education Cess and Secondary and Higher Education Cess is not leviable on the goods which were cleared to DTA from an EOU unit - appeal allowed.
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2013 (11) TMI 1663
Issues involved: Determination of correct amount of Modvat Credit to be reversed u/s Special Scheme dated 04.01.1997, appointment of Cost Accountant, submission of figures and calculations by petitioners, explanation to be provided by petitioners, submission of report by Cost Accountant, consideration of report by adjudicating authority, determination of correct amount of Modvat Credit, liability for interest in case of short reversal, availability of Modvat (Cenvat) benefit in case of excess reversal, challenge to adjudication order on merits.
In the judgment, the High Court directed the Chief Commissioner/Commissioner to appoint a Cost Accountant to determine the correct amount of Modvat Credit to be reversed u/s the Special Scheme dated 04.01.1997. The petitioners were instructed to submit figures and calculations to facilitate the Cost Accountant in carrying out the exercise. The Cost Accountant was mandated to provide an opportunity to the petitioners or their authorized representatives to explain the accounts and the manner in which they have reversed the Modvat Credit. Subsequently, the Cost Accountant was required to submit a report to the Excise Department with a copy to the petitioner. The adjudicating authority/Commissioner was then tasked with considering the report and determining the correct amount of Modvat Credit required to be reversed, after providing adequate opportunity to the petitioner. The order was to specify whether any excess or short reversal had occurred, with appropriate directions/orders to be passed accordingly. In case of short reversal, the petitioner would be liable to pay interest at a rate of 20% per annum as per the undertaking recorded in the order dated 31.01.1997. Conversely, in case of excess reversal, the Modvat (Cenvat) benefit on the said Modvat Credit would be made available to the petitioner, and requisite certificates would be issued. The judgment clarified that the rate of interest, as fixed by the High Court order, would not be interfered with. It was further noted that upon payment being made in accordance with the order and the adjudication order, the scheme would be considered satisfied. The writ petition was disposed of with no costs, and it was stated that in case of an adverse order, the petitioner could challenge the adjudication order on merits but not on the rate of interest.
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9911796707
