|
Advanced Search Options
Case Laws
Showing 141 to 160 of 2075 Records
-
2019 (3) TMI 1941
Reopening of assessment u/s 147 - ITO Phagwara jurisdiction to issue notice - HELD THAT:- As the term “Assessing Officer” used in Sec. 147 of the IT Act cannot be accorded any other meaning except that envisaged in Sec. 2(7A) as per which the same has to be construed as the AO vested with the relevant jurisdiction by virtue of directions or orders issued under sub-section (1) of subsection (2) of Sec. 120 or any other provision of the IT Act.
There is neither anything borne from the records nor any material has been produced before us during the course of hearing of the appeal, which would reveal that the ITO, Ward-4, Phagwara was at the time of issuing the notice under Sec. 148 of the IT Act was exercising either exclusive or concurrent jurisdiction over the case of the assessee. On the basis of our aforesaid observations, it can safely be concluded that the notice issued under Sec. 148, dated 27.03.2015 by the ITO, Ward- 4, Phagwara who was not vested any jurisdiction over the case of the assessee would have no existence in the eyes of law. We thus in the backdrop of the aforesaid facts are constrained to observe that the assessment framed by the ITO, Ward-3, Phagwara under Sec. 147 r.w.s 143(3) of the IT Act, dated 29.03.2016 in the absence of a valid notice issued under Sec. 148 cannot be sustained and is liable to be quashed.
As we have quashed the assessment framed by the A.O under Sec. 147 r.w.s. 143(3), dated 29.03.2016 for want of jurisdiction, therefore, we refrain from adverting to and therein adjudicating the merits of the addition made in the hands of the assessee. - Decided in favour of assessee.
-
2019 (3) TMI 1940
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Corporate Debtor contends that the Company’s stock (Diamonds), which was kept as security with the bank has been misappropriated/lost due to bank’s fraud/ gross negligence - Financial Creditors - Non-Performing Assets - existence of debt and dispute or not - HELD THAT:- This Bench finds that the counter claim filed by the Corporate Debtor in DRT is no bar to proceed with this petition keeping in view the fact that the Adjudicating Authority is not bound to ascertain the exact amount of claim at the stage of admission.
In V.R. Polyfab Pvt. Ltd. vs. Sadhbhav Enterprise Pvt. Ltd. [2017 (9) TMI 1859 - NATIONAL COMPANY LAW TRIBUNAL, AHMEDABAD], decided on 19th September, 2017, NCLT, Ahmedabad Bench, gave a similar view on this question observing that even assuming that the Corporate Debtor is entitled for certain amount from the Financial Creditor, the same can only be treated as a set off or counter claim and therefore it cannot be treated as a ‘dispute’ relating to financial debt due to the financial creditor from the Corporate Debtor. Further, it observed that though Corporate Debtor has pleaded counter-claim or set-off, but it cannot be said that there is no default in repayment of financial debt by Corporate Debtor.
Debt and default - HELD THAT:- The Corporate Debtor does not deny the same. Financial Facilities have been duly granted and the amounts have been disbursed. There has been a default in repayment and the same has been admitted to some extent. This can be said in view of the reply letter dated 09.05.2016, wherein the Company replied to the notice of ICICI Bank saying that it was facing temporary financial difficulties and that they were taking steps towards regularizing its loan account. It is worth to note that there is no denial of the debt amount by the Corporate Debtor - Also, the pendency of proceedings in DRT is no bar to the present Section 7 proceedings in view of Section 238 of the Code. The Petitioner’s claim of existence of debt and default has been corroborated with ample evidence and is enough to hold a view in its favour.
The Financial Creditor has established that the loan was duly sanctioned and duly disbursed to the Corporate Debtor but there has been default in payment of Debt on the part of the Corporate Debtor - the nature of Debt is a “Financial Debt” as defined under section 5 (8) of the Code. It has also been established that admittedly there is a “Default” as defined under section 3 (12) of the Code on the part of the Debtor.
The Petitioner has not received the outstanding Debt from the Respondent and that the formalities as prescribed under the Code have been completed by the Petitioner, this Petition deserves ‘Admission’ - Petition admitted - moratorium declared.
-
2019 (3) TMI 1939
Seeking recall of order - the principles laid down by Hon'ble the Supreme Court in the case of Forech India Ltd. v. Edelweiss Assets Reconstruction Company Ltd. [2019 (1) TMI 1442 - SUPREME COURT] were not placed - HELD THAT:- Mere appointment of Provisional Liquidator would not denude the NCLT of its jurisdiction under the provisions of Insolvency & Bankruptcy Code which are considered to be an independent proceeding. Therefore, in view of the aforesaid legal position no doubt is left that the petition could not have been disposed of on the ground of that Hon'ble High Court where has appointed the Provisional Liquidator in a winding up petition.
The order is recalled. As a necessary consequence the CP. No. (IB)-104(PB)/2018 is restored. The petition stands already admitted on 30.05.2018 and Mr. Alok Kumar Kuchhal has been appointed as the Resolution Professional. Resolution Professional shall proceed from the stage the proceedings were left.
Application disposed off.
-
2019 (3) TMI 1938
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - HELD THAT:- The Corporate Debtor defaulted on the coupon payments payable by the calendar quarter ending 30.06.2018 which resulted into default in terms of the Debenture Trust Deed - As this being resulted into default, this Co-Applicant as a Debenture Trustee on 07.08.2018 issued notice to the Corporate Debtor quantifying the default committed by the Corporate Debtor and demanding the Corporate Debtor to forthwith make coupon payments due to the Financial Creditor. Since no payment has come from the Corporate Debtor by calendar quarter ending 30.06.2018, initially the Co-Applicant as the debenture Trustee issued a notice on 07.08.2018 to the corporate debtor calling upon the debtor to clear the dues, as no payment has come, these applicants have filed this application making a claim of ₹ 8,51,35,527.41 for initiation of CIRP.
As against the claim made by the Financial Creditor, the counsel appeared on behalf of the Corporate Debtor has not raised any objection for initiation of Corporate Insolvency Resolution Process because the Corporate Debtor is not in a position to pay the amount as stated in the Debenture Trust Deed executed by the Corporate Debtor, this Bench, having gone through the documents and being satisfied of the material disclosing existence of debt and default, hereby admits this Company Application.
Petition admitted - moratorium declared.
-
2019 (3) TMI 1937
Restriction on recovery of damages to 5% per annum - It is the case of the petitioner that the office of the petitioner passed an order, levying damages on the second respondent under Section 14B of the Employees Provident Fund and Miscellaneous Provisions Act, 1952 - HELD THAT:- The impugned order passed by the first respondent is a detailed and well considered order. Each and every ground raised by the petitioner in this writ petition has been answered in the impugned order dated 08.09.2009, passed by the first respondent. The first respondent has rightly held that the imposition of damages under Section 14B of the Act is only discretionary. As rightly observed, Section 14B does not mandate that the order for damages must follow in the event of every default. As seen from the materials available on record, there was no deliberate intention on the part of the second respondent to delay the payment of Provident Fund.
The Tribunal has rightly held that the regulation 32A in which a graded scale for imposition of damages has been provided cannot be regarded as a rigid or inflexible prescription and regulations cannot be a fetter to the exercise of the power that is conferred upon the Provident Fund Commissioner by the provisions of the enactment, but guide and channelise the exercise of discretion. The Tribunal has also rightly held that neither regulation 32A or 32B can be regarded as inflexible - this Court does not find any infirmity in restricting the damages imposed on the second respondent up to 5% per annum on the arrears of contribution.
Petition dismissed.
-
2019 (3) TMI 1936
Arbitration petition challenges an award passed by a sole arbitrator in a reference arising out of disputes concerning a share purchase contract - HELD THAT:- Having failed in justifying the award on either of the two issues on legality considered by the learned arbitrator, learned Counsel for the Respondents seeks to rely on the submissions contained in his affidavit in reply, which are termed as cross-objections. Relying on these objections, learned Counsel seeks to sustain the award challenging its other findings, which are against the Respondents. I am afraid, it is not open to a respondent in an arbitration petition under Section 34 of the Act to rely on any cross-objection for setting aside the award (i.e. its reasons), or, indeed, for sustaining it (i.e. its operative part) when the challenger is able to justify his challenge
Such application cannot be termed as an appeal from the award and, if that is so, there is no question of importing the provisions or, indeed, the principle, of Order 41 Rule 22 into it on an analogy of an arbitration appeal under Section 37 of the Act. Anomalous consequences would follow, if we were to do so and allow the opponent to a challenge petition under Section 34 to raise cross-objections to an arbitral award, whether towards its reasoning or its operative part, in the event the challenger succeeds in his challenge under Section 34. First of all, that would require us to read Section 34 in an unnatural way.
We would have to hold that a cross-objection is not a recourse to a Court against an arbitral award. Section 34, in its very opening line (sub-section (1)), provides that recourse to a court against an arbitral award may be made only by an application for setting aside such award in accordance with sub-sections (2) and (3).
On the other hand, the right to take a cross-objection under Order 41 Rule 22 is nothing but an exercise of the same right of appeal which is given to an aggrieved party. Secondly, one would be at a loss to find applicable grounds which can be taken in such cross-objections, though, in the absence of any other indication, and also logically, it would have to be supposedly the same grounds which are provided for an application for setting aside an award.
Thirdly, there is no provision in law for making such cross-objections in any particular form. If there is no form unlike the one provided in Order 41 Rule 22 and the objections in a challenge petition could be in the form of a reply to the petition, there is no indication how such objections are to be treated in case the challenge petition under Section 34 is rejected. Should a cross-objection be nevertheless heard and determined in that case, just as a cross-objection would under sub-rule (4) of Order 41 Rule 22.
There is the unanswered question of time of such cross-objections. A strict time-line is provided for a challenge petition under Section 34. Should there be no time for cross-objections and should there be any consequences for non-filing of such objections within that time. We are driven to find out these answers outside Section 34, and that too when the Courts are unanimous that it is a complete code.
This Court is not inclined to consider the cross-objections stated by the Respondents in their reply to the arbitration petition for sustaining the final award by impugning its reasons.
-
2019 (3) TMI 1935
Refusal to accept compromise / settlement between the parties - Inherent powers Under Section 482 of the Code of Criminal Procedure to quash the proceedings - non-compoundable offence - conduct on the part of the Accused were required to be considered by the High Court while quashing the FIR - apparent conflict between the two decisions of this Court in the cases of NARINDER SINGH & ORS. VERSUS STATE OF PUNJAB & ANR [2015 (2) TMI 1042 - SUPREME COURT] and State of Rajasthan v. Shambhu Kewat [2013 (11) TMI 1789 - SUPREME COURT] - HELD THAT:- So far as the conflict between the decisions of this Court in the cases of Narinder Singh and Shambhu Kewat is concerned, in the case of Shambhu Kewat (supra), this Court has noted the difference between the power of compounding of offences conferred on a court Under Section 320 Code of Criminal Procedure and the powers conferred Under Section 482 Code of Criminal Procedure for quashing of criminal proceedings by the High Court. In the said decision, this Court further observed that in compounding the offences, the power of a criminal court is circumscribed by the provisions contained in Section 320 Code of Criminal Procedure and the court is guided solely and squarely thereby, while, on the other hand, the formation of opinion by the High Court for quashing a criminal proceedings or criminal complaint Under Section 482 Code of Criminal Procedure is guided by the material on record as to whether ends of justice would justify such exercise of power, although ultimate consequence may be acquittal or dismissal of indictment. However, in the subsequent decision in the case of Narinder Singh (supra), the very Bench ultimately concluded that Power conferred Under Section 482 of the Code is to be distinguished from the power which lies in the Court to compound the offences Under Section 320 of the Code. No doubt, Under Section 482 of the Code, the High Court has inherent power to quash the criminal proceedings even in those cases which are not compoundable, where the parties have settled the matter between themselves. However, this power is to be exercised sparingly and with caution.
It is observed and held as under:
i) that the power conferred Under Section 482 of the Code to quash the criminal proceedings for the non-compoundable offences Under Section 320 of the Code can be exercised having overwhelmingly and predominantly the civil character, particularly those arising out of commercial transactions or arising out of matrimonial relationship or family disputes and when the parties have resolved the entire dispute amongst themselves;
ii) such power is not to be exercised in those prosecutions which involved heinous and serious offences of mental depravity or offences like murder, rape, dacoity, etc. Such offences are not private in nature and have a serious impact on society;
iii) similarly, such power is not to be exercised for the offences under the special statutes like Prevention of Corruption Act or the offences committed by public servants while working in that capacity are not to be quashed merely on the basis of compromise between the victim and the offender;
iv) offences Under Section 307 Indian Penal Code and the Arms Act etc. would fall in the category of heinous and serious offences and therefore are to be treated as crime against the society and not against the individual alone, and therefore, the criminal proceedings for the offence Under Section 307 Indian Penal Code and/or the Arms Act etc. which have a serious impact on the society cannot be quashed in exercise of powers Under Section 482 of the Code, on the ground that the parties have resolved their entire dispute amongst themselves. However, the High Court would not rest its decision merely because there is a mention of Section 307 Indian Penal Code in the FIR or the charge is framed under this provision. It would be open to the High Court to examine as to whether incorporation of Section 307 Indian Penal Code is there for the sake of it or the prosecution has collected sufficient evidence, which if proved, would lead to framing the charge Under Section 307 Indian Penal Code. For this purpose, it would be open to the High Court to go by the nature of injury sustained, whether such injury is inflicted on the vital/delegate parts of the body, nature of weapons used etc. However, such an exercise by the High Court would be permissible only after the evidence is collected after investigation and the charge sheet is filed/charge is framed and/or during the trial. Such exercise is not permissible when the matter is still under investigation. Therefore, the ultimate conclusion in paragraphs 29.6 and 29.7 of the decision of this Court in the case of Narinder Singh (supra) should be read harmoniously and to be read as a whole and in the circumstances stated;
v) while exercising the power Under Section 482 of the Code to quash the criminal proceedings in respect of non-compoundable offences, which are private in nature and do not have a serious impact on society, on the ground that there is a settlement/compromise between the victim and the offender, the High Court is required to consider the antecedents of the Accused; the conduct of the Accused, namely, whether the Accused was absconding and why he was absconding, how he had managed with the complainant to enter into a compromise etc.
Appeal allowed.
-
2019 (3) TMI 1933
Duty demand / Reversal of cenvat credit - Bagasse - Manufacture - generation of electricity - whether Bagasse which emerges as residue/waste of sugarcane is subjected to excise duty or not - HELD THAT:- In view of the decision in UNION OF INDIA VERSUS DSCL SUGAR LTD. [2015 (10) TMI 566 - SUPREME COURT] nothing survives for consideration in these Special Leave Petitions and the Civil Appeal.
Appeal dismissed.
-
2019 (3) TMI 1932
Validity of reopening of assessment - reasons recorded by the AO based on incorrect fact - mistake in the reasons recorded - HELD THAT:- In the case in hand, the AO himself as admitted the mistake in the reasons recorded and we find that it is not only mistake in the reasons recorded but the AO has also made the addition while passing the impugned assessment order on account of credit card bills U/s 69C .
Subsequent explanation of the AO that this amount represents the cash deposit in the bank account will not remove the defects in the reasons recorded. Assessing Officer in the reasons recorded for reopening of the assessment was proposed to assess the income on account of unexplained expenditure incurred by the assessee which was also assessed to tax at the time of passing the reassessment order. Subsequently, the AO has come out with the explanation in the remand report that the amount represents the income on account of cash deposited in the bank account therefore, it is re-categorization of transaction from unexplained expenditure to cash deposit in the bank account
CIT(A) has stated that in the notice issued U/s 142(1) of the I.T. Act the AO has mentioned the cash deposit in the bank account however, the AO finally made the addition on account of payment of credit card bills then the notices issued U/s 142(1) itself was not considered by the AO while making the addition. Even otherwise the notice issued U/s 142(1) would not substitute the reasons recorded by the AO. Accordingly,the amount which was proposed to assess the income by the AO in the reasons recorded is not actually represents the payment of credit card bills then, reopening based on the incorrect facts and non application of mind is not sustainable in law. - Decided in favour of assessee.
-
2019 (3) TMI 1931
Constitutionality of the Black Money (Undisclosed Foreign Income & Assets) and Imposition of Tax Act, 2015 - HELD THAT:- Having heard the learned counsel for the petitioner, however, we do not find any reason to either stay any of the provisions of the Act or prevent the Competent Authority under the said Act from passing appropriate orders on pending proceedings. Interim reliefs prayed in the petition are therefore, refused.
-
2019 (3) TMI 1930
Exemption u/s 11 Denied - AO denied by holding that the assessee had charged excess fees then approved by the statutory body - CIT(A) allowed relief to the assessee u/s 11 - HELD THAT:- CIT(A) held that assessee is a deemed university to which special ordinance of U.P. Government 04.07.2012 was applicable and after becoming deemed university the provision of fee fixation committee of State Government is not applicable. Clause 29 of Extra Ordinarily Gazette of U.P. State Government clearly defines that ordinance shall be made by the Executive Council for the purpose of fee to be charged for courses being studied in the university and for admission to the examination degrees, diploma and certificate of the university. The ld. CIT(A) has appreciated the entire facts and has given a categorical finding that the assessee was a deemed university established by Special Ordinance of U.P. Government dated 04.07.2012. The above finding do not require any interference as we do not find any infirmity in the same, therefore, the Ground No.1 of appeal of the Revenue is dismissed
Disallowance of depreciation - assessee claimed depreciation which was rejected by the AO on the ground that the capital expenditure incurred during the accounting year was allowed as deduction form the income of the assessee, the deduction of depreciation was not allowed on the ground that full deduction had been allowed in respect of capital cost of the asset and if the depreciation was allowed, as claimed by the assessee, it would result in double deduction - HELD THAT:- On a reference, the Hon'ble Bombay High Court confirmed the view taken by the Tribunal by holding that the Tribunal was right in law in directing the AO to allow depreciation on the assets, the cost of which had been fully allowed as application of income under section 11 in the past year. We, therefore, keeping in view the ratio laid down in the aforesaid referred to case of Institute of Banking [2003 (7) TMI 52 - BOMBAY HIGH COURT] set aside the order passed by the learned CIT(A) and direct the Assessing Officer to allow the depreciation on the written Dawn Value of the assets.
Anonymous donation - As per sub Section (3) of 115BBC, ‘anonymous donation’ mean voluntary contribution where a person receiving such contribution does not maintain a record of identity indicating the name and address of the person making such contribution - HELD THAT:- We find that only requirement u/s 115BBC of the Act is the name and address of the donor has to be maintained which the assessee had maintained. We further find that the assessee had declared entire receipt of donations in the total income as is apparent for computation which had already been made part of this order and had utilized the entire amount for charitable purposes as the total application of funds is more than fee receipt and voluntarily contribution.
Disallowance of adhoc expenditure - HELD THAT:- We find that the percentage of expenditure during the year under consideration in respect to fee income was 31.73% as against 40.20% in the earlier year which was lower than the earlier year - Assessing Officer had made the disallowance only on adhoc basis without rejection of books of account and without pointing out any deficiency in the vouchers. We further find that the assessee had placed on record complete list of personal expenses and copy of which is also placed and therefore, there was no justification of the Assessing Officer to make the addition and therefore, the ld. CIT(A) has rightly deleted the same.
Disallowance of expenditure out of administrative expenses on adhoc basis - AO has disallowed expenses on adhoc basis without pinpointing any specific defect in bills/ vouchers produced - if an addition has been made in the case of charitable trust the same would be treated as application for charitable purpose - HELD THAT:- Since the registration u/s 12A of the Act of the appellant trust is restored by Hon'ble I.T.A.T. and as already discussed above that the appellant is eligible for exemption u/s 11 of I.T. Act. Accordingly, since the income of the appellant is exempt, the addition made on account of disallowance from expenses will also amount to application of Income and will have no sanctity.
Disallowance of interest paid on term loan - HELD THAT:- We find that the AO had disallowed the same holding the same to be as capital expenses where the fact remain that the expenditure was incurred for the building which was also put to use and assessee had claimed depreciation on the building also. We further find if expenditure was not allowable as revenue expenditure even then the same was allowable as utilization as capital expenditure is also allowed for the purpose of calculating exemption u/s 11 of the Act. The entire capital as well as revenue expenditure has to be taken into account as utilization of funds.
-
2019 (3) TMI 1929
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - Dishonor of Cheque - insufficiency of funds - HELD THAT:- The Petition reveals that on 11.05.2018 the Corporate Debtor had defaulted in making repayment to the Petitioner in terms of the Facility Agreements executed by it. In this regard, a meeting was held, wherein the delinquencies under the Facility Agreements were categorically discussed at length, and upon such discussion the Corporate Debtor had admitted to such delinquencies and handed over 4 cheques to the Petitioner amounting to ₹ 1,38,46,268/-. On 08.06.2018, out of the said 4 cheques, the cheque bearing no’s. 152934 and 152935 dated 29.05.2018 were dishonoured and returned with the remark “Funds Insufficient”. And, the cheque bearing no’s. 152937 and 152938 were not presented on the request of the Corporate Debtor due to non-availability of funds - Petition further reveals that on 13.06.2018 the Corporate Debtor had once again admitted its default and reassured that the entire payment under the Facility Agreements would be made at the earliest. Pursuant to the said meeting, on 14.06.2018, the Corporate Debtor had written an e-mail to the Petitioner thereby admitting its default under the Facility Agreements.
The Corporate Debtor is liable to pay the Petitioner and defaulted in making the payment to the Petitioner. During the hearing of this matter by this Bench, the Counsel representing the Corporate Debtor accepted the liability as well as default - This Adjudicating Authority, on perusal of the documents filed by the Creditor, is of the view that the Corporate Debtor defaulted in repaying the loans availed and also placed the name of the Insolvency Resolution Professional to act as Interim Resolution Professional and there being no disciplinary proceedings pending against the proposed resolution professional, therefore the Application under subsection (2) of Section 7 is taken as complete.
Petition admitted - moratorium declared.
-
2019 (3) TMI 1928
TP Adjustment - comparable selection - functional dissimilarity - HELD THAT:- Companies functionally dissimilar with that of assessee's IT Segment and ITes segment need to be deselected as comparable - difference in the business model brought out between assessee and selected comparable makes it uncomparable.
-
2019 (3) TMI 1927
Reopening of assessment u/s 147 - No proper and valid service of notice issued u/s 148 - notice was served by way of affixture - mandation of serving officer to show that all due and reasonable diligent efforts were made to serve the assessee/defendant with the notice - whether the notice affixed on the door of the assessee on 31.3.2015 on the last day of limitation for service of notice under the provisions of section 151 of the Act is a valid service specially when no efforts were made by the revenue to serve the notice through the normal course and straightway affixed the notice? - HELD THAT:- The order V of CPC Rule 17 provides service of notice by way of affixture on the defendant on his residence or place of business on the outer door if defendant refuses to accept the service or can not be found. The serving officer can affix the notice on the out door of the house/residence where the defendant ordinarily resides or carries on business. The serving officer then report the circumstances under which the notice was affixed and name and address of the person by whom the house/place of business was identified and in whose presence the copy of the notice was affixed.
As is clear from the above that the inspector income tax stated in his report that only upon finding the door closed he has no option but to make affixture of the notice on the out door of the assessee. There is no doubt that the AO has not made any due effort or diligence to serve the notice and affixed the same on the date of issuance of the said notice. There is nothing on records that the assessee was hiding or avoiding the service of notice and there is also no evidence on records that the service could not be made through ordinary ways/means. In this the case the ordinary means of service of notice were not used or exhausted and the service was made directly through affixture at the last minutes on 31.3.2015 to avoid limitation expiring on 31.3.2015. Thus there is merit and force in the arguments of the ld AR that there is no valid service of notice and the proceedings are null and void as the notice issued u/s 148 was not served upon the assessee.
In the Hon’ble Delhi High Court in the case of CIT Vs Hotline International (P) Ltd [2007 (4) TMI 44 - DELHI HIGH COURT] held has that where the serving officer does not make any efforts to locate the assessee, the service by affixture in invalid and re-assessment proceedings are bad in law. The background facts in this case are that the serving officer visited the office of the assessee to serve the notice and security guard informed that the office is closed for holi festival. The serving officer made the affixture which was held to be invalid.
Service of notice issued u/s 148 dated 31.3.2015 through affixture on 31.3.2015 is not a valid service and accordingly the re-assessment proceedings and consequent order are quashed. - Decided in favour of assessee.
-
2019 (3) TMI 1926
TDS u/s 195 - payments abroad of export commission to non-resident the foreign agent for the procurement of export orders - disallowance u/s 40(a)(i) - CIT-A said commission paid to foreign agent for procurement of export orders is in the nature of business income of the foreign agent and not FTS, thus not liable to TDS and deleted the addition - HELD THAT:- Issue is covered in favour of the assessee in case of DIT Vs. Panalfa Autoelektrik Ltd. [2014 (9) TMI 706 - DELHI HIGH COURT] wherein it is held that commission paid by the assessee to its foreign agent for arranging of export sales and recovery of payments could not be regarded as Fee for Technical Services u/s 9(1)(vii).
In the present case, the commission was paid to ACE Trading, a non-resident agent (payee) who is a tax resident of France. The payee was simply assisting inprocuring export orders for the Assessee in his ordinary course of business in France. The commission was paid for activities of the payee outside India and the amount is received by the payee outside India through normal banking channels.
Section 5(2) states that total income of a person, who is a non-resident, includes income from all sources which (a) is received or deemed to be received in India; (b) accrues or arises in India; or (c) is deemed to accrue or arise in India. In the present case, the commission income paid to the foreign agent neither accrued in India nor deemed to be accrued in India as per deeming provisions of section 9 and nor the same was received nor deemed to be received in India. Thus, there is no need to interfere with the findings of the CIT(A). The Appeal of the Revenue is dismissed.
-
2019 (3) TMI 1925
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - Financial Debt or not - existence of debt and dispute or not - HELD THAT:- In the present case applicant bank had sanctioned and disbursed the term loan amount recoverable with applicable interest by entering in to loan agreements with the corporate debtor. The corporate debtor had borrowed the credit facility against payment of interest as agreed between the parties. The loan was disbursed against the consideration for time value of money with a clear commercial effect of borrowing. Moreover, the debt claimed in the present application includes both the component of outstanding principal and interest. In that view of the matter not only the present claim comes within the purview of ‘Financial Debt’ but also the applicant bank can clearly be termed as ‘Financial Creditor’ so as to prefer the present application under Section 7 of the Code.
An application under Section 7 of the Code is acceptable so long as the debt is proved to be due and there has been occurrence of existence of default. What is material is that the default is at least 1 lakh. In view of Section 4 of the Code, the moment default is of Rupees one lakh or more, the application to trigger Corporate Insolvency Resolution Process under the Code is maintainable.
In the facts it is seen that the applicant bank clearly comes within the definition of Financial Creditor. The material placed on record further confirms that applicant financial creditor had disbursed various loan facilities to the respondent corporate debtor and the respondent has availed the loan and committed default in repayment of the outstanding financial debt. On a bare perusal of Form -I filed under Section 7 of the Code read with Rule 4 of the Rules shows that the form is complete and there is no infirmity in the same - the present application is complete in all respect and the applicant financial creditor is entitled to claim its outstanding financial debt from the corporate debtor and that there has been default in payment of the financial debt.
Application admitted - moratorium declared.
-
2019 (3) TMI 1924
Maintainability of application - disclosure of cause of action over which this Tribunal has jurisdiction to entertain and decide the application under the provisions of the NGT Act, 2010 - principle of res judicata and/or constructive res judicata - time limitation - HELD THAT:- It is settled that there is no vested right of appeal unless the statute so provides. Further, if a statute provides for a condition subject to which the appropriate Appellate Court can exercise jurisdiction, the Court is under an obligation to satisfy itself whether the condition prescribed is fulfilled. Exercise of appellate jurisdiction without the fulfillment of statutory mandate would be without jurisdiction. Therefore, the right of appeal provided Under Section 22 is to be read subject to the conditions provided therein - Section 22 provides for an appeal to the Supreme Court on the grounds specified in Section 100 of the Code of Civil Procedure. Under Section 100 Code of Civil Procedure, an appeal can be filed only on the ground that the case involves a substantial question of law as may be framed by the Appellate Court. The scope of appeal Under Section 22, therefore, is restricted to substantial question of law arising from the judgment of the Tribunal.
It is equally settled that merely because the remedy of appeal is provided against the decision of the Tribunal on a substantial question of law alone, that does not ipso facto permit the Appellants to agitate their appeal to seek re-appreciation of the factual matrix of the entire matter - there cannot be fresh appreciation or re-appreciation of facts and evidence in a statutory appeal under this provision.
Maintainability of the application - HELD THAT:- Section 33 of the Act provides an overriding effect to the provisions of the Act over anything inconsistent contained in any other law or in any instrument having effect by virtue of law other than this Act. This gives the Tribunal overriding powers over anything inconsistent contained in the KIAD Act, Planning Act, Karnataka Municipal Corporations Act, 1976 (KMC Act); and the Revised Master Plan of Bengaluru, 2015 (RMP). A Central legislation enacted under Entry 13 of List I Schedule VII of the Constitution of India will have the overriding effect over State legislations. The corollary is that the Tribunal while providing for restoration of environment in an area, can specify buffer zones around specific lakes & water bodies in contradiction with zoning Regulations under these statutes or the RMP.
Time limitation - HELD THAT:- The application had to be filed within a period of six months from the date on which cause of action for such dispute has first arisen in terms of Section 14 of the NGT Act. Admittedly, the present application has been filed in March, 2014 and according to them, it is much beyond the prescribed period of limitation. Also, there is no application for condonation of delay accompanying the main application. Therefore, the Tribunal will not have jurisdiction to condone the delay.
The prayers and the geneses of the respective proceedings are entirely distinct and different in their scope and relief. The issues before the Tribunal would essentially relate to environment ecology and its restoration while the proceedings before the High Court relate to entirely different issues with acquisition of land, its allotment and transfer to the third party - the Tribunal was justified in holding that the objections taken by the Respondent Nos. 9 and 10 do not satisfy the basic ingredients to attract the application of res judicata or constructive res judicata.
Appeal dismissed.
-
2019 (3) TMI 1923
Legality of the reassessment proceedings - notice u/s 143(2) of the Act was not issued - whether the impugned order can be held to be invalid merely for non issuance of notice u/s 143(2)? - HELD THAT:- As relying on Dimension Promoters Pvt. Ltd [2018 (1) TMI 393 - ITAT DELHI] the impugned reassessment order is liable to be quashed being invalid, bad in law and void abinitio as the revenue authorities post issuance of notice u/s 148 of the Act failed to issue statutory notice u/s 143(2) of the Act which is mandatory before commencing the assessment proceedings. - Decided in favour of assessee.
-
2019 (3) TMI 1922
Arrest order to be converted to summon order - only prayer is that since arrest warrants have been issued in complaint registered in 2013which was kept pending by the Enforcement Directorate till 2017and formal complaint was filed on 21.09.2017 - HELD THAT:- Considering the fact that the matter was kept pending for four years by the Enforcement Directorate and petitioners were not arrested, it is deemed proper to direct the Court to summon the petitioners by bailable warrants instead of arrest warrants. At this juncture, Counsels for petitioners submit that they would appear before the Court below.
Criminal Revision Petition is dismissed as withdrawn.
-
2019 (3) TMI 1921
Disallowance of interest u/s 36(i)(iii) - interest on the loans/advances made to subsidiary company should not be disallowed - HELD THAT:- As funds sanctioned by the bank were utilized in other group companies on the direction of the holding company. These funds were not utilized for any purpose of the object of the assessee company - exclusive utilisation of these funds were not for the purpose of the assessee’s business and the expenditure of interest is not for the purpose of assessee’s business and clearly for the purpose of other group companies.
Coming to the question of business expediency in this transaction, any act carried out for the purpose of its own business or carried out for the benefit of the subsidiary as a share holder can be referred to as business expediency. In the given case, the assessee is in the business of consultancy and no business commitment to fund other sister concern and the action of the assessee to fund step down subsidiary will not fit into representing any share holder commitment. The actual share holders are the holding company, any holding company diverting its own funds to the subsidiaries will fit into business expediency as held in the case of SA Builders [2006 (12) TMI 82 - SUPREME COURT] - The assessee company was used as a source for funding the step down subsidiaries and the cost should also be transferred to the subsidiary who has utilized the funds and the burden of cost of funds on the assessee is unwarranted, may be beneficial to the overall group but not on the assessee. It clearly indicates that the transaction of funding the sister companies are not exclusively for the purpose of assessee’s business. Therefore, the ground raised by the assessee is dismissed.
Disallowance u/s 14A - CIT(A) deleted the disallowance on the ground that no interest was incurred on the share capital invested and also assessee did not receive any dividend income - HELD THAT:- The Hon’ble Delhi High Court in the case of Cheminvest Ltd [2015 (9) TMI 238 - DELHI HIGH COURT] has held that section 14A will not apply where no exempt income is received or receivable during the relevant assessment year. Following the said decision, we find no infirmity in the order of CIT(A) in deleting the disallowance made by the AO u/s 14A of the Act. Accordingly, the ground raised by the revenue on this issue is dismissed.
............
|
9911796707
