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Showing 141 to 160 of 1574 Records
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2024 (12) TMI 1434
Bogus LTCG - Addition u/s 10(38) - Tribunal cancelling the disallowance of Long Term Capital Gain - as decided by HC [2022 (10) TMI 1264 - CALCUTTA HIGH COURT] appeal filed by the revenue were allowed and the substantial questions of law were answered in favour of the revenue
HELD THAT:- Let supplementary affidavit be filed by the respondent explaining whether steps stand taken preferring any appeal(s) wherein the writ petition(s) stands dismissed. Also what action is taken against the erring officials who sat over the files and allowed the appeals to be preferred only after a prolonged period of delay.
We may point out that in the counter affidavit, the respondent themselves have pointed out that the tax evasion involved has an estimated revenue impact exceeding Rs. 38,000/- crores.
Needful be done within a period of two weeks. Rejoinder, if any, may be filed by the petitioner within one week thereafter.
List on 15.1. 2025.
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2024 (12) TMI 1433
Initiation of penalty proceedings during the pendency of an appeal against an assessment order - Whether provisions contained in Section 275(1)(a), per se, operates as bar to initiation of penalty proceedings once an appeal is filed? - HELD THAT:- Provision creates a bar based on limitation. It does not create a complete embargo on initiation of penalty proceedings on mere filing of appeal. The bar is that if the proceedings are not initiated within the period of limitation, prescribed therein, it will be barred by limitation. Therefore, the bar is based on failure to initiate proceedings and not on mere filing of appeal. That is what flows on literal reading of the provision.
There is no warrant for us to add something more into it and to create a new bar on initiation or continuance of penalty proceedings upon mere filing of appeal. Therefore, the submission of learned counsel for the petitioner in this regard must fail.
Remedy u/s 220 (6) - We are of the view that at this stage, the writ remedy need not be invoked because the petitioner does have a remedy under the law. Whether or not in a given case, stay of demand has to be ordered, would essentially be in the exercise of the discretion by the Assessing Officer, as provided u/s 220 (6) of the Act of 1961.
We leave it open for the petitioner to approach the appropriate authority at an appropriate stage when the demand notices are issued to him.
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2024 (12) TMI 1432
Validity of reassessment Notice issued in the name of a dead person - whether notices issued u/s 148A (b) and 148 to a deceasead person are sufficient to continue the proceedings thereafter with the legal representatives of the deceased assessee if the prescribed period of limitation for issuing such notice has expired vis-a-vis such LR? - HELD THAT:- Notices issued u/s 148A (b) and 148 of the Act in the name of a dead person are invalid and ‘non-est’ in the eye of law. It is a nullity and not a mere irregularity which could be cured. It is true that, on the receipt of the above said notices, the legal heirs of the deceased Naringaparambail Bhaskaran/appellants herein appeared before the assessing authority. However, that by itself would not change the situation.
We are of the opinion that the consent of the parties cannot confer jurisdiction to the assessing authority for initiation of an action which is otherwise illegal and ‘non-est’.Decided in favour of assessee.
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2024 (12) TMI 1431
Estimation of income - bogus purchase - purchase of waste paper from grey market - HELD THAT:- There is no infirmity in the impugned orders passed by the CIT (A) and the Tribunal, considering the fact that the Assessing Officer has not invoked the provision of Section 145 of the Act to reject the books of account and therefore, the estimate profit determined on the bogus purchases made by the assessee at the rate of 7.5% requires no interference.
Similarly, for the Assessment Year 2015-16, similar additions are made which is restricted to 7.5% of the profit on the bogus purchase.
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2024 (12) TMI 1430
Validity of reassessment proceedings - reasons to believe - borrowed satisfaction or independent application of mind - Speculation Profit on currency derivatives - reopening relying upon the information made available on the insight portal - HELD THAT:- It appears from the reasons recorded that the no verification of the material on record is made by the respondent and there is no independent opinion that any income has escaped assessment due to any failure on the part of the assessee in not disclosing fully and truly all material facts necessary for assessment.
From the reasons recorded it appears that the initiation of reopening proceedings are on the borrowed satisfaction as no independent opinion is formed and on bare perusal of the reasons recorded, it emerges that the AO considering the information received from the insight portal, has issued impugned notice forming reason to believe that the income has escaped the assessment on the presumption that the petitioner has been involved in creating the non-genuine profit which is already offered to tax in the return of income which is accepted in the regular course of assessment by passing the order u/s 143 (3) of the Act.
AO has not considered the material on record to come to the conclusion that there is failure on the part of the petitioner to disclose truly and fully all material facts to have reason to believe for escapement of income. Therefore, on the basis of the information received from another agency on insight portal or from the SEBI report, there cannot be any reassessment proceedings unless the respondent, after considering such information/material received from other sources, consider the same with the material on record in the case of the petitioner assessee and thereafter, is required to form independent opinion that income has escaped assessment.
Without forming such opinion solely and mechanically relying upon the information received from the other sources, the respondent-Assessing Officer could not have assumed the jurisdiction to reopen the assessment based on such information. This view is fortified by the decision of this Court in case of Harikishan Sunderlal Virmani [2016 (12) TMI 1558 - GUJARAT HIGH COURT] - Decided in favour of assessee.
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2024 (12) TMI 1429
Income deemed to accrue or arise in India - fees for technical services ('FTS') / Fees for Included Services ('FIS') under Article 12 of the India - US Double Taxation Avoidance Agreement ('DTAA') - receipts accruing to the Appellant on account of provision of Global Information Services (GIS) being services in the nature of general maintenance of software and hardware including services procured from third party and overhead thereof ('routine GIS Services') to its affiliate in India - HELD THAT:- DRP and learned AO concluded receipts accruing to the assessee/appellant on account of provision of GIS being services in the nature of general maintenance of software and hardware procured from 3rd party and other head thereof (‘routine GIS services’) to is affiliate in India are in the nature of Fees for Technical Services (‘FTS’) / Fees for Included Services (‘FIS’) under Article 12 of the India – US Double Taxation Avoidance Agreement (‘DTAA’). Undisputedly, learned DRP and AO did not sought details of the invoices.
It is the fact that HD India had shut down its business of distribution of motor cycles, spare parts and accessories in India in the year under consideration. It is clearly evident that the contentions of the learned AO as well as the learned DRP that such services provided enduring benefit or enable the employees of HD India to apply the technology embedded in such services in the future is devoid of any merit.
The matter is restored to the file of AO for fresh decision in accordance with law. Appeal filed by the assessee is allowed for statistical purposes.
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2024 (12) TMI 1428
Validity of reopening of assessment - non disposal of assessee’s objections filed against reopening of assessment - HELD THAT:- In a letter forwarded by AO it does not deal with the objections filed by the assessee against reopening of assessment. Hence, contentions of the Revenue that the objections were disposed of by the AO on 05.09.2018 are misplaced. No infirmities in the finding of First Appellate Authority. The objections of the assessee against reopening of assessment were not disposed off by the AO, hence, the assessment is vitiated. Decided in favour of assessee.
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2024 (12) TMI 1427
Characterization of income - addition of interest income received on compensation received u/s. 28 of the Land Acquisition Act, 1894 - assessee had received interest on enhanced compensation on compulsory acquisition of land under the Land Acquisition Act, 1894 and claimed interest as part of the compensation and exempt from tax u/s. 10(37) - scope of provisions of section 56(2) of the Act were amended by the Finance (No.2) Act 2009 w.e.f 01.04.2010 -
HELD THAT:- Hon'ble Apex Court in the case of CIT vs Ghanshyam HUF [2009 (7) TMI 12 - SUPREME COURT] has held that interest received on compensation/enhanced compensation is part of compensation, hence, exigible to tax u/s. 45(5) of the Act.
As in the case of Mahender Pal Narang vs CBDT[2020 (3) TMI 1115 - PUNJAB AND HARYANA HIGH COURT] after considering amended provisions of section 56(2) of the Act distinguished the decision rendered in the case of Ghanshyam HUF (supra) and held that interest received on compensation or enhanced compensation is to be treated as ‘Income from Other Sources’ and not under the head ‘Capital Gains’.
Recently, in the case of PCIT vs. Inderjit Singh Sodhi HUF [2024 (4) TMI 408 - DELHI HIGH COURT] held that interest whether on compensation or enhanced compensation received on acquisition of land u/s. 28 or u/s. 34 of the Land Acquisition Act, 1894 shall be exigible to income tax as ‘Income from Other Sources u/s. 56(2)(viii) - Decided against assessee.
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2024 (12) TMI 1426
Penalty u/s. 271(1)(c) - disallowance of assessee’s claim of deduction u/s. 10B - as alleged notice is defective as the AO has not struck off irrelevant clause of section 271(1)(c) - HELD THAT:- While indicating penalty the AO intended to invoke only Explanation 1. The ambiguity in mentioning charge at the time initiation of penalty and while issuing notice u/s. 274 r.w.s 271(1) of the Act is writ large. It is a well settled law that any ambiguity in notice for levy of penalty would vitiate penalty proceedings. Hence, penalty u/s. 271(1)(c) of the Act is liable to be deleted on account of defective notice itself.
Even on merits, assessee has a case. The assessee had claimed deduction u/s. 10B - During assessment proceedings the assessee surrender the claim. In computation of income and in Tax Audit Report filed along with return of income, the assessee had disclosed entire particulars.
Merely, for the reason that the assessee has claimed deduction which according to the AO was not admissible to the assessee would not make a case for levy of penalty under section 271(1)(c).
As decided in Reliance Petro Products P Ltd. [2010 (3) TMI 80 - SUPREME COURT] mere making of a claim which is not sustainable in law by itself will not amount to furnishing inaccurate particulars regarding the income of assessee. Such claim made in the return cannot amount to inaccurate particulars. Decided in favour of assessee.
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2024 (12) TMI 1425
CIT(A) dismissed appeal ex-parte - validity of Reopening u/s 147 - addition @ 5% of the total credits appearing in the assessee company’s bank account - borrowed satisfaction of escaped income on the count of deposits in HDFC bank - HELD THAT:- We are unable to persuade ourselves to accept the manner in which the appeal of the assessee has been disposed off by the CIT(Appeals). In our considered view, once an appeal is preferred before the CIT(Appeals), it becomes obligatory on his part to dispose off the same on merit and it is not open for him to summarily dismiss the appeal on account of non-prosecution of the same by the assessee.
In fact, a perusal of Sec.251(1)(a) and (b), as well as the "Explanation" to Sec.251(2) of the Act reveals that the CIT(Appeals) remains under a statutory obligation to apply his mind to all the issues which arises from the impugned order before him. As per the mandate of law the CIT(Appeals) is not vested with any power to summarily dismiss the appeal for non-prosecution. See PREMKUMAR ARJUNDAS LUTHRA (HUF) [2016 (5) TMI 290 - BOMBAY HIGH COURT].
Not being able to persuade ourselves to subscribe to the dismissal of the appeal by the CIT(Appeals) for non-prosecution, therefore, set-aside his order with a direction to dispose off the same on merits. Appeal of assessee is allowed for its statistical purposes.
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2024 (12) TMI 1424
Assessment u/s 153A - no incriminating material found in search - validity of the statement recorded u/s 132(4) and effect on retraction statement - HELD THAT:- When there is no incriminating document found, and the assessment year is 2012-13 no addition can be made except that is supported by incriminating document. We get support this view from the recent judgment delivered by the apex court in the case of Principal Commissioner of Income Tax, Versus Abhisar Buildwell P. Ltd [2023 (4) TMI 1056 - SUPREME COURT] wherein held no addition can be made in respect of the completed assessments in absence of any incriminating material.
We also get support from judgment in the case of PCIT Vs. M/s. Esspal International P. Ltd.[2024 (9) TMI 652 - RAJASTHAN HIGH COURT] stating that the merely based on the retracted statement no addition can be made. No reason to sustain the addition and therefore, the same is directed to be deleted. Decided in favour of assessee.
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2024 (12) TMI 1423
Unexplained expenditure u/s. 69C - assessee had not furnished details on nature and purpose behind the expenditure incurred - double taxation - explanation provided by the assessee regarding the source of cash expenditures, as accepted by the Interim Board for Settlement - HELD THAT:- We find that the source from which the unaccounted expenditure was incurred has already been considered and taxed in the hands of Director and substantial shareholder of the assessee company as held in the settlement order.
The notings of undisclosed expenditure had been fully explained by furnishing the cash flow statement which has been accepted by the ld. IBS. Thus, we note that cash receipt was offered to tax and out of that cash receipt, cash expenditure was noted.
Addition of such cash expenditure in the hands of the assessee would tantamount to double taxation, firstly as cash income in the hands of Director in the settlement proceedings and again in the hands of the assessee as cash expenditure. We are of considered view that, once the source of cash is taxed, it cannot be further taxed as unexplained cash expenditure.
Once the source of cash is taxed, it cannot be further taxed as unexplained cash expenditure. The issue regarding addition of unexplained expenditure in the hands of assessee is squarely covered and considered by the order of ld. IBS while disposing the settlement application of Mr. Vikas Oberoil wherein ld. IBS has accepted the explanation on the source of unexplained expenditure.
We delete the addition made in the hands of the assessee u/s. 69C for cash payments, treated by the ld. Assessing officer as unexplained expenditure. - Decided in favour of assessee.
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2024 (12) TMI 1422
Addition on account of Travel Expenses u/s 37 - allowable business expenditure or not? - expenses on foreign travel to countries such as the USA, Dubai, and France - assessee contended that these expenses were incurred to explore business opportunities and establish relations abroad. HELD THAT:- Under Section 37(1) of the Act, only those expenses that are incurred "wholly and exclusively" for business purposes are allowable. The onus is on the assessee to substantiate the business nexus of such expenses. In the present case, no documentary evidence, such as agreements, business communications, or other substantiating material, was produced to establish that the foreign travel was undertaken solely for business purposes. The absence of such evidence weakens the claim of the assessee that the expenses were incurred wholly and exclusively for business purposes.
Based on the AR’s submissions and admission, and in the interest of fairness, we deem it reasonable to disallow 30% of the foreign travel expenses to account for the personal element, while allowing the balance 70% as business expenses. Accordingly, we partly allow this ground of appeal.
Addition u/s 68 - unexplained cash credit - AO observed that amount was recorded in the head "Dev Aurum Booking Account" in the books of the assessee and represented cash received during the financial year under consideration - assessee failed to discharge its burden of proving the nature and source of the cash credited in the books of accounts and the explanation provided was inadequate and lacked documentary support - HELD THAT:- The onus is squarely on the assessee to prove the identity, creditworthiness, and genuineness of the transaction, which remains unfulfilled in this case.
Tax auditor’s comment that the transaction was "subject to reconciliation" indicates a lack of clarity and proper documentation regarding the nature and source of the cash credit. This strengthens the view that the assessee failed to maintain proper records and reconcile the transaction adequately.
Thus, on failure of the assessee to discharge its onus under Section 68, we find no infirmity in the findings of the AO and the CIT(A). Accordingly, the addition u/s 68 is confirmed, and this ground of appeal is dismissed.
Addition made by AO u/s 36(1)(va) on account of delay in depositing PF/ESIC contributions - AO observed that the assessee had delayed depositing employees' contributions toward PF/ESI beyond the statutory due dates specified under the respective Acts - HELD THAT:- AR conceded that the issue is already decided by the Hon’ble Jurisdictional High Court against the assessee. Additionally, this issue has been conclusively settled in the case of Checkmate Services (P.) Ltd. [2022 (10) TMI 617 - SUPREME COURT]
We find no merit in the assessee's contention. The disallowance made by the AO and confirmed by the CIT(A) is upheld. Accordingly, this ground of appeal is dismissed.
Addition u/s 36(1)(iii) on account of interest - sufficient own interest-free funds - HELD THAT:- We hold that the disallowance made by the AO and upheld by the CIT(A) is not sustainable. Assessee has demonstrated the availability of sufficient interest-free funds and the lack of a direct nexus between borrowed funds and the advances. Accordingly, we delete the addition made u/s 36(1)(iii).
Appeal of the assessee is partly allowed.
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2024 (12) TMI 1421
Estimation of gross profit on unaccounted sales - Unaccounted purchases is to be taxed by applying gross profit rate of 8.49% OR net profit applied by AO at 12% - HELD THAT:- A reasonable profit rate should be estimated and if the gross profit rate is to be added that can be added at the rate of 2%, going by the nature of business of the assessee and similar line of business only on the unaccounted part or payment made in cash for which cash was utilized for making purchases and consequent sale of MJPL.
Hence, we are of the view that a reasonable estimate of gross profit of 2% will meet the ends of justice for both sides i.e., for the Department as well as for the assessee for all these six assessment years for unaccounted purchases only of gold from MJPL not recorded in the regular books of accounts. Hence, we direct the AO to apply gross profit rate of 2% on cash payment made for unaccounted purchases of gold from MJPL for these relevant six assessment years and not on recorded purchases
Disallowance of cash payment u/s.40A(3) - We direct the AO to delete this disallowance as in this case, the income of the assessee is assessed applying flat gross profit rate and assessee has not claimed any deduction with regard to the purchases made by him, hence the provisions of section 40A(3) cannot be invoked.
We reverse the findings of the CIT(A) on this issue and accordingly, this issue of assessee’s appeal on enhancement is allowed. Accordingly, interconnected issue with regard to applicability of section 40A(3) of the Act, is decided in favour of the assessee and as regards to application of profit rate, we direct the AO to apply gross profit rate of 2% in all the six assessment years.
Addition of excess stock jewellery incorrectly added when there was no excess stock - We note that the assessee has specifically filed invoices and tried to correlate the excess gold stock and if these invoices are correct then it seems that there is no excess stock but these things need verification at the level of AO. Hence, we set aside the order of AO and CIT(A) on this issue and remand this issue back to the file of the AO for fresh adjudication. In term of the above, this issue of the assessee is allowed for statistical purposes.
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2024 (12) TMI 1420
Validity of reopening of assessment - Notice issued beyond period of four years - HELD THAT:- We are of the view that reopening is made beyond 4 years and as the original assessment was framed u/s. 143(3) and also reassessment was completed u/s. 143(3) r.w.s.147 of the Act, the Revenue could not establish any failure on the part of the assessee to disclose fully and truly all material facts necessary for its assessment and hence we are of the considered view that, the reopening in the present case is bad in law. Hence, the reopening is quashed and the jurisdictional issue is raised in the CO is allowed in favour of assessee.
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2024 (12) TMI 1419
Penalty u/s 270A for misreporting of income - non specification of clear charge - Argument of AR is that no specific charge has been framed against the assessee in first show-cause notice - HELD THAT:- In the assessment order, Ld. AO has not specified the exact charge against the assessee but initiated penalty proceedings simplicitor. In the show-cause notice issued to the assessee u/s 274 r.w.s. 270A on 18-12-2019, Ld. AO initiated penalty on both the limbs i.e., under-reporting as well as misreporting of income.
Finally, in the penalty order, AO held that it was a case of under-reporting of income in consequence of misreporting of income. Therefore, it was a fit case for levy of penalty u/s 270A(9)(a). We find that no specific charge has been framed against the assessee in the show-cause notice - Decided in favour of assessee.
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2024 (12) TMI 1418
Addition u/s 68 - genuinity, creditworthy and transactions of the loan-creditors are in question and the entire addition was made as per the information from the investigation wing - HELD THAT:- We respectfully relied on the orders of the Ambe Tradecorp (P.) Ltd [2022 (7) TMI 902 - GUJARAT HIGH COURT] and Sandip Kumar Gupta [2024 (7) TMI 1574 - ITAT KOLKATA] which deleted the addition of loan if repaid during the financial year. The same observation is upheld in the case of the CIT vs. S.C.Ghosal [1976 (4) TMI 44 - CALCUTTA HIGH COURT]
DR had not rebutted any contrary decisions against the submissions of the ld. AR.
Loan amount was duly paid during the impugned assessment year. There is no balance for the assessee related to this loan amount. The assessee is not the beneficial owner of the loan during the impugned assessment year. Assessee filed evidence during assessment proceeding which is acknowledged by CIT(A) in the impugned appellate order. So, the contravention of Section 68 related identity, creditworthiness and transaction trough banking channel are ruled out.
Interest on the alleged unsecured loan - For rest of the interest was pertained to loan of earlier years and the part of interest of loan where the loan was repaid during the impugned assessment year are also followed the same principle laid down by the orders mentioned above. We do not find any reason to interfere in the impugned appeal order. Decided against revenue.
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2024 (12) TMI 1417
Addition u/s 36(1)(iii) - grant of interest free loan to subsidiaries - HELD THAT:- In the present case it is admitted position that the Assessee had granted loans to wholly owned subsidiaries in the same line of business. Thus, the Assessee had deep interest in the subsidiaries.
CIT(A) has recorded that the wholly owned subsidiaries were operational and running hotels. The fact that the subsidiaries were undertaking projects related to hospitality/restaurant business and that the funds have been used for the same has not been doubted by the authorities below.
As in SA Builder [2006 (12) TMI 82 - SUPREME COURT] held that in case where an assessee has deep interest in the subsidiary and the same is used by the subsidiary for business purpose, the assessee would be entitled to claim deduction for interest expenses incurred in respect of loans granted to such subsidiary. In our view, the above judgment applied to the facts of the present case and the Assessee would be entitled to claim deduction for interest expenses incurred in relation to loan to subsidiaries.
As funds were initially granted for expansion of business undertaken by the wholly owned subsidiaries. Later on the interest was waived to protect the investments in subsidiaries by helping them pull out of financial crunch faced by them. Thus, we are of the view that the Appellant acted on account of commercial expediency - disallowance u/s 36(1)(iii) deleted - Decided in favour of assessee.
Addition u/s 68 in respect of cash deposits - HELD THAT:- In the remand report, after verification, the Assessing Officer concluded that there was nothing to contradict the claim of the Assessee and therefore, in effect, accepted the explanation of the Assessee regarding cash deposits having been made in the normal course of restaurant/hospitality business admittedly being run by Assessee.
CIT(A) also accepted the remand report and deleted the addition after considering the reply/submission filed by the Assessee. Nothing has been brought on record by the Revenue to either controvert the findings of the AO [in the remand report] and the CIT(A) [in the order impugned]; or to support the factual issues raised in the grounds of appeal. No infirmity has been pointed out in the replies/details furnished by the Banks and/or the documents, details, bank certificates etc. said to have been filed by the Assessee before the AO and CIT(A). Decided in favour of assessee.
Rental income receipts - addition u/s 24 treating sum as income from house property - difference between the income from house property as per the Income Tax Return and the rental receipts has reflected in Form 26AS - HELD THAT:- On perusal of Profit and Loss Account along with Note No.34 dealing with the ‘Revenue from Operations’, we find that ‘Room Income’ and ‘Food And Banquet Income’ has been included under the head ‘Sale & Services’ and credited to the Profit and Loss Account as ‘Revenue from Operations’. It has not been disputed by the Revenue that chart showing details of TDS u/s 194(1)(b) and details of rent earned by the Appellant as per Form 26AS and rent offered by the Appellant as per the Gross Revenue in the Profit and Loss Account were note filed before the Authorities below - we delete the addition made under Section 24 and set aside the issue back to the file of Assessing Officer for denovo adjudication after carried out necessary enquiries/verification. Ground raised by the Assessee are allowed for statistical purposes.
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2024 (12) TMI 1416
Revocation of the CB license - forfeiture of the security deposit - imposition of a penalty - alleged violation of Regulations 10(d), 10(e), 10(f) of CBLR, 2018 - failure to advice the exporter properly on the need to file declaration that they are not the dealing with export of Readymade garments - Fulfilment of obligations as required under CBLR, 2018 or not - HELD THAT:- The issue of overvaluation of export goods based on the evidences of the report from Consulate General of India, Dubai etc., are exactly similar to the case already decided by this Tribunal in JOHN K MATHEW VERSUS PRINCIPAL COMMISSIONER OF CUSTOMS (GENERAL) NEW CUSTOMS HOUSE, BALLARD ESTATE, MUMBAI [2024 (8) TMI 410 - CESTAT MUMBAI].
In the above referred order, the Tribunal has held that the appellants CB cannot be fastened with the act of omission and commission in relation to a provision in the Customs, Central Excise Duties and Service Tax Drawback Rules, 1995 that intended empowering the Central Government to device a schedule of rates of drawback in lieu of engaging in computation of drawback on each incident of export. It was also held by this Tribunal, stating it clearly that the benefit, even if 'undue’, derived by the exporter is not of such gravitas as to merit revocation of license to practice a profession and, more specifically, when the licensing authority itself appears to have discountenanced proper conjecture of the provision of law that supposedly made the impugned goods offending. Accordingly, the Tribunal had set aside the Order of the Principal Commissioner in suspending the appellants CB license - in the present appeals before us too, the findings of the learned Principal Commissioner in respect of charges against Regulations 10(d), 10(e) and 10(f) of CBLR, 2018 does not sustain on the same analogy adopted by the Tribunal in the case of appellants-CB on similar exports made by the same exporter M/s World Wide Export.
It is also found that the Hon’ble High Court of Delhi has held in the case of KUNAL TRAVELS (CARGO) VERSUS COMMISSIONER OF CUSTOMS (IMPORT & GENERAL) NEW CUSTOMS HOUSE, IGI AIRPORT, NEW DELHI [2017 (3) TMI 1494 - DELHI HIGH COURT], the appellants CB is not an officer of Customs who would have an expertise to identify mis-declaration of goods.
Conclusion - A Customs Broker cannot be held liable for the actions of the exporter unless there is clear evidence of the broker's involvement in the alleged misconduct. Thus, CB did not violate the relevant regulations.
There are no merits in the impugned order - appeal allowed.
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2024 (12) TMI 1415
Smuggling - seizure of gold by customs officials - absence of reasonable belief of the goods being smuggled - discharge of burdento prove - Confiscation - penalties - HELD THAT:- As per the circular no. 1/2017 stipuates that there should be reasonable belief by/seizing officer both in seizure list as well as Panchnama separately - But in the instant case, it is seen that seizing officer has certainly failed to comply with such circular thereby rendering the seizure and subsequent, the proceedings thereto bad in the eyes of law. The key element under Section 123 of the Customs Act, 1962 is reasonable belief. The officer exercising its reason of belief must be acquainted to the reason of belief that same is illegally imported into a country whereof mere possession cannot be a factor to determine the same and even the same must be a factor to exercise over and above the reason of suspect if proper officer exercising jurisdiction under Section 110 of the Customs Act, 1962 - the appellant has produced certain documents in support of his claim to discharge its onus in Section 123 of the Customs Act, 1962 which made the goods subject to release.
Confiscation of gold - HELD THAT:- In this case the gold being importable subject to conditions as imposed and appellant has already produced the mode of procurement of the said goods. Therefore, the goods are not liable for confiscation under Section 111(d) of the Act. Further, the statements made by the appellant during the course of investigation has not been examined. In terms of Section 138 (B) of the Customs Act, 1962, no evidence have been adduced to effect to prove that goods in question recovered from the appellant is the alleged act of smuggling.
Conclusion - The absence of reasonable belief clearly makes the instant seizure proceedings vitiated in nature which in turn makes the entire SCN proceedings and its consequent adjudication thereto bad in the eyes of law.
The impugned order qua absolute confiscation of gold in question is not sustainable in the eyes of law - Appeal allowed.
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