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Showing 141 to 160 of 1482 Records
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2023 (6) TMI 1342
Seeking for interim order - HELD THAT:- There is no scope of passing any interim order in the matter and the issue involved in this writ petition requires affidavit from the respondent for final adjudication.
Let the respondents file affidavit-in-opposition within four weeks, petitioner to file reply thereto, if any, within two weeks thereafter - List this matter for final hearing in the monthly list of September, 2023.
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2023 (6) TMI 1341
Validity of scrutiny assessment - Jurisdiction of authority who issued notice - whether there is valid notice issued u/s 143(2) for commencing the scrutiny assessment? - HELD THAT:- ITO, Ward-49(1), Kolkata had no valid jurisdiction over the assessee on the date of issuing notice u/s. 143(2) of the Act. Revenue has not controverted this fact by placing any other contrary material on record to indicate otherwise. Since a valid notice u/s. 143(2) has not been issued, the assessment proceedings carried thereafter deserves to be quashed. We, therefore, respectfully following the ratio laid down by Hon’ble jurisdictional High Court in the case of PCIT Vs. Shree Shoppers Ltd. [2023 (3) TMI 1432 - CALCUTTA HIGH COURT] allow ground raised by the assessee and quash the assessment proceedings completed u/s. 143(3).
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2023 (6) TMI 1340
Seeking grant of Bail - Money Laundering - proceeds of crime - present applicant and the main accused Suryakant Tiwari were involved in illegal extortion from the coal transporters working in the Coal Mines within the State of Chhattisgarh - HELD THAT:- What is apparently evident is that the prosecution in the course of the investigation has collected substantial materials showing strong nexus between the applicant and the other accused persons in the said crime. From the documents produced in the Court during the course of hearing, there seems to be prima-facie materials collected establishing Money Laundering at the hands of the present applicant and the other accused persons. The prosecution has been able to show documents collected in the course of the search and seizure showing incriminating evidences in the form of handwritten diaries and digital devices, like mobile phones, laptops, etc. which would disclose numerous cash transactions and other illegal transactions operated by the main accused Suryakant Tiwari as per the dictates of the present applicant, who being a public servant used Suryakant Tiwari and Manish Upadhyay her a front men.
Having perused the entire voluminous documents produced by either side, the magnitude of the amount involved in the so called scam or the economic offence is incomprehensible. Further, the number of persons involved in the commission of the offence directly or indirectly and many of them being part of the bureaucracy itself and the period of commission of the offence spanning considerable period of time makes the gravity of the offence graver. What is required to be seen is the gravity and magnitude of the offence - An economic offence is a rampant and pervasive social wrongdoing; each country on the planet is confronting this socio-economic challenge in one or the other form. It is the most consequential threat to a nation’s economy at large. It's nothing but another attempt to satisfy an individual’s greed over need.
For the law enforcement agencies, it becomes a Herculean task to conduct interrogation and gather evidence since tampering of evidence is easy given the nexus of the accused parties with the system. 20. In such circumstances, the need of impartiality and fair play requires distinctive modus operandi to lift the veil off of economic offences. One way is to keep the accused parties in custody for longer period, so that there will be minimum hinderance and maximum efficiency in the investigation not just that of the applicant but also of all others who are involved in the offence. For that purpose, bail ought not be allowed in the same way as conceded in the event of regular offences.
Taking into consideration the magnitude of the offence, this Court is not inclined to grant bail to the present applicant as of now - bail application rejected.
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2023 (6) TMI 1339
Taxability - Business Support Services (BSS) or not - receipt of the appellant-assessee’s share in the Central Rights Income is a consideration for rendering alleged services to BCCIIPL in organizing the IPL tournament - 10% of the payments made by Franchisee Company to the foreign players - reverse charge mechanism - payments made to EM Sporting Holdings Limited for management consultancy services under RCM - costs incurred in marketing and PR activities outside India under RCM - reversal of common CENVAT Credit availed for providing taxable and exempt output service - 90% of payments made by Franchisee company to the foreign players under RCM - 100% of payments by the Franchisee company to foreign coaches and support staff under RCM.
Whether receipt of the appellant-assessee’s share in the Central Rights Income is a consideration for rendering alleged services to BCCIIPL in organizing the IPL tournament, and whether it is taxable as ‘Business Support Services’? - HELD THAT:- The Tribunal by relying upon the decision of the Tribunal in the case of Mormugao Port Trust Vs. CCE [2016 (11) TMI 520 - CESTAT MUMBAI] has set aside the demand holding that in case of joint venture contract, there is neither an intention to render a service to the other partner(s) nor is there any fixed consideration quid pro quo for any particular service of a partner. It has further been held that a contractorcontractee or the principal-client relationship, which is the essential element of any taxable service, is absent in the case of the partners or co-venturers in a joint venture agreement. In the present case, since the demand of Rs.19,15,11,610/- in respect of Central Rights Income arising out of the franchise agreement cannot be considered as provision of any service between the members to the franchise agreement, we are of the view that such demand cannot be confirmed on the appellants-assessee.
Whether 10% of the payments made by Franchisee Company to the foreign players is taxable under the reverse charge mechanism (“RCM”) as BSS on the basis that the players carry out promotional activities (incl. wearing uniforms with logos, etc.)? - HELD THAT:- The said issue has already been dealt with by the Co-ordinate Bench of this Tribunal, in the case of Sourav Ganguly Vs. Commissioner of Service Tax, Kolkata (Now Commissioner of Central Goods & Service Tax & Central Excise, Kolkata South) [2020 (12) TMI 534 - CESTAT KOLKATA], wherein it was held that the view taken by the commissioner is not correct as the players had received the fees for the purpose of playing cricket only and even otherwise, it is a settled principle of law that if no machinery provision exists to exclude nontaxable service (playing cricket) from a composite contract, the same is not taxable since law must provide a measure or value of the rate to be applied and any vagueness in the legislative scheme makes the levy fatal. Thus, the Tribunal held in this case that the confirmation of demand could not be sustained. Considering that the ratio of the above decision squarely applies to the present case in hand, we are of the view that the demand of service tax for Rs.47,91,703/- towards fees paid to foreign players and other professionals on RCM basis is not sustainable.
Whether payments made to EM Sporting Holdings Limited for management consultancy services are taxable under RCM under taxing entry for Management or Business Consultant’s Service? - HELD THAT:- The disputed period for which demands were raised relate to 2008-2009 and 2011-2012, much prior to the amendment to Section 67 introduced w.e.f. 14.05.2015. Hence, the confirmation of demand for Rs.90,86,726/- in respect of reimbursable expenses to EM Sporting Holdings Limited on RCM basis cannot be considered as there exists no legal provision for charging to service tax on such reimbursement charges. Thus, we are of the view that such demand cannot be confirmed on the appellantsassessee.
Whether costs incurred in marketing and PR activities outside India is taxable under the taxable service for BSS, on RCM? - HELD THAT:- The identical issue was considered by the Coordinate Bench of this Tribunal, in the case of KPH Dream Cricket Pvt. Ltd. Vs. CCE & ST, Chandigarh-I [2019 (5) TMI 1171 - CESTAT CHANDIGARH]. Upon consideration of such issue, the Tribunal had held that the main object of the appellant-assessee is to promote game of cricket in India through IPL tournaments. For obtaining service of organizing the said tournaments cannot be treated a service is in nature of Business Support Service. Therefore, no service tax is leviable under the category of Business Support Service as discussed hereinabove in the preceding paragraphs, hence the demand of service tax is not sustainable. Further, the documents produced by the appellants-assessee indicate that the expenses incurred were on account of purchase of match tickets in UK, creation of DVD titled ‘Rajasthan Royals road to victory’ etc, which were reimbursed to the foreign vendor - As the present case is identical in the factual matrix to the above case already decided by the Tribunal, it is considered that there exists no ground to deviate from the above stand. Accordingly, the confirmation of demand Rs.22,48,336/- towards service tax liability on reimbursable amount paid to foreign vendors on RCM basis is not sustainable.
Whether the appellant is required to reverse common CENVAT Credit availed for providing taxable and exempt output service? - HELD THAT:- The explanation 3 to Rule 6(1) of the Cenvat Credit Rules, 2004 was amended vide notification No. 13/2016-C.E. (NT) dated 01.03.2016, wherein the ‘exempted service’ was expanded to include ‘an activity which is not a service as defined under Section 65B (44) of the Finance Act, 1994’ w.e.f. 01.04.2016, for which reversal of cenvat credit is required. Hence, prior to this there was no legal requirement legally binding an assessee to reverse cenvat credit of inputs or inputs services taken on such activities which are not services under the scope of the said Finance Act, 1994. Considering the above legal position in respect of Cenvat Credit Rules, 2004 and that the ratio of the above decision squarely applies to the present case in hand, the confirmation of demand Rs.2,18,58,230/- towards common Cenvat credit reversal is not sustainable.
Whether 90% of payments made by Franchisee company to the foreign players is taxable under RCM as BSS on the basis that they carry out promotional activities (incl. wearing uniforms with logos, etc.)? - HELD THAT:- The issue has been addressed in a number of cases earlier by Co-ordinate Benches of the Tribunal and in the case of M/s KPH Dream Cricket Pvt. Ltd. [2019 (5) TMI 1171 - CESTAT CHANDIGARH] it was clearly held that the main activity of players, who were engaged under a contract by the appellants-assessee, is to play cricket apart from engagement of promotional activities which are ancillary to the main activity of playing cricket. On drawing support from various decisions held in favour of the appellants-assessee, the Tribunal held in this case that on player’s fee, no service tax is payable and upheld the decision of the Commissioner in rightly dropping the demand of service tax on player’s fees - the instant case is covered by the decision of the Tribunal in the above case, and thus there are no merit for interfering with the decision of the learned Principal Commissioner in dropping the demand of service tax in the impugned order.
Whether 100% of payments by the Franchisee company to foreign coaches and support staff is taxable under RCM as BSS on the basis that they carry out promotional activities? - HELD THAT:- As the coaching in the field of sports has been specifically excluded from the applicability of service tax vide definition of ‘commercial training or coaching centre’ under section 65(27) of the Finance Act, 1994, and further as the service of coaching is not provided by a centre but by an individual coach and support staff, Principal Commissioner concluded that the service tax is not chargeable on such activity. Further, in this case the fees pertains to coaching the cricket players who are playing for the team and the amount paid is attributable to the coaching service or support service and thus service tax cannot be demanded on these fees and services, as sports coaching services are exempt - the demand of service tax on this issue is not sustainable and appeal made by the Revenue does not survive.
The impugned order of Principal Commissioner of Service Tax, Mumbai-IV confirming the adjudged demands are liable to be set aside as being not sustainable in law - Appeal allowed.
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2023 (6) TMI 1338
Unexplained cash deposits in bank account u/s 68 - all deposits were in denomination notes (old notes) - assessee was doing his business for booking of railway tickets - HELD THAT:- All the amount received by assessee were ultimately deposited/remitted to the account of IRCTC by way of debit card payment. The assessee throughout the proceedings before the Assessing Officer as well as before the ld. CIT(A) contended that he was working as an agent/sub-agent of Akbar Online Booking Pvt. Ltd.. Such contention of assessee was not controverted by the Assessing Officer by making investigation of fact or bringing any adverse material. The assessee has also furnished the details of his client for which he made booking through IRCTC.
The assessee has also relied on press release of Economic Times wherein booking of railway tickets are also allowed by way of old currency notes. On careful perusal of such press release, we find that in the press release, there is no such restriction that railway tickets is to be booked on railway counters only. Like private hospitals were also allowed to receive old currency notes.
AO has not controverted the contentions and the material brought on record by assessee. As decided in the case of Anantpur kalpana [2021 (12) TMI 599 - ITAT BANGALORE] that “where Assessing Officer made addition under Section 68 on account of cash deposited by assessee in its two bank account post demonetization, since said cash deposit was towards assessee’s sale proceeds which was already offered to tax by assessee and admitted by revenue as revenue receipt, impugned addition made under section 68, resulting in double taxation, were liable to be deleted.”
Thus assessee has discharged his onus by showing prima facia material that the entire cash deposits was part sale transaction, thus, no addition of cash deposits was warranted. Assessee appeal allowed.
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2023 (6) TMI 1337
Professional misconduct of statutory Auditors - Forensic Audit Report shows irregularities in financial statements apparently showing profits through inflated sales and non-existent purchases and sales noticed by SEBI - allegation of books of accounts of ARL were manipulated - Allegation of price and trade movement in the scrip of ARL - violations of various provisions of SEBI Act, 1992 and PFUTP Regulations 2003 - as per SEBI Noticees being statutory auditors had been conspiring with the management and/or were knowingly negligent in their job so as to facilitate the Company in defrauding the shareholders and investors - HELD THAT:- There is no dispute to the finding that the Noticees were instrumental in preparing accounts of ARL.We find that there are strong evidences in this matter available on records to point out that there has been gross negligence and dereliction of duty on the part of Noticees.
However, at the same time we can turned a blind eye to the fact that the Noticees had issued a Qualified Report highlighting certain irregularities in the financials of the Company that were taken up for limited review for the quarter ended 31-12-2014.
The instances of being unprofessional or being negligence would be difficult to equate with committing fraud in connivance with the management, where evidences are not sufficient to demonstrate that the Noticees had actually manipulated the books of accounts with knowledge and fraudulent intention.
In the absence of any tangible evidence, the question of fraud committed by the them would be difficult to survive and therefore in the absence of any material to establish knowledge/collusion/connivance of the Noticees with such fraudulent scheme, the Noticee cannot be brought under disciplinary/penal jurisdiction of SEBI.
With respect to any possible connivance or collusion by the Noticees with the Company or its management, it is acknowledged that, in such matter it is very difficult to find out either a written agreement or such agreement of minds and the same has to be culled out from the acts of the parties.
However, there has to be some evidence to support such meeting of minds before attributing to the Noticees of actively colluding with the Company. In the present matter, we don’t find sufficient evidence from the record to make an assertive statement that there was an agreement or understanding suggesting that the Noticees were acting in connivance and collusion with the Company or its management in executing their fraudulent scheme.
However, at the same time, while dealing with the submission of the Noticees for being granted exoneration based on the observations in the peer review conducted by the ICAI, it may be stated that primary objective of peer review is not to find out deficiencies but to improve the quality of services rendered by members of the profession.
Under the circumstances, while granting benefit of doubt to the Noticees with respect to alleged commission of fraud by the Noticees, it would sufficient that to meet the end of justice so as to address the gross negligence and sheer professional misconduct as displayed by the Noticees as the Statutory Auditor of the Company which has been deliberated and established beyond doubt in the preceding paragraphs, the instant proceedings are disposed of with the following directions.
Directions - We find that the materials brought forth in the Investigation while propounding the allegation against the Noticees herein, lack the tenacity to withstand legal scrutiny required in the matter pertaining to violation of the PFUTP Regulations, 2003 or suchlike. Accordingly, we are constrained to dispose of the present proceedings qua the Noticees with a cautionary advice to be careful while dealing in the securities market.
However, looking at the glaring misconduct and dereliction of duties and abhorrence of due diligence while conducting statutory audit as glaringly displayed by the Noticees, it is directed that a certified copy of this order be forwarded to ICAI and NFRA for appropriate action, if any, as deemed fit at their end.
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2023 (6) TMI 1336
Interim order - HELD THAT:- There is no scope of passing any interim order in the matter and the issue involved in this writ petition requires affidavit from the respondent for final adjudication.
List this matter for final hearing in the monthly list of September, 2023.
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2023 (6) TMI 1335
Unblocking of ITC - HELD THAT:- It appears that the 2nd respondent had unblocked the said credit on 31.05.2023. In the said circumstances, this court is of the view that no order need to be passed in this petition.
This Writ petition is dismissed as infructuous.
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2023 (6) TMI 1334
Maintainability of appeal - non prosecution of the case - HELD THAT:- Despite giving all the opportunities for the Appellants to appear, they have not availed themselves of this opportunity. It appears they are not serious about pursuing this matter.
The Appeals are dismissed for non prosecution.
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2023 (6) TMI 1333
Validity of assessment order passed u/s 153A - whether a valid approval granted by the additional commissioner of income tax u/s 153D? - HELD THAT:- Approving authority has not mentioned any indication that the approving authority has examined the draft orders and finds that it meets the requirement of the law. Even the approving authority has not written or repeated the words of the statute, in granting the approval u/s 153D - mere endorsing a list of cases by signature with "rubber stamping" of the letter without mentioning even the words like 'seen' or 'approved' will not satisfy the requirement of the law for approval or sanction u/s 153D.
Therefore, we hold that in the present case, the prior approval of the Additional CIT before passing the order of assessment in pursuant to a search operation being a mandatory requirement of section 153D of the Act was not as per law because such approval is not meant to be given mechanically. Without application of mind by the Additional CIT which resulted in vitiating the assessment orders themselves.
In the above view, we hold that mandatory approval was being granted mechanically without application of mind by ACIT, Central-Range, Jalandhar, and therefore, this mechanical exercise of power has vitiated entire assessment proceedings. Decided in favour of assessee.
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2023 (6) TMI 1332
Surrendered income Addition u/s 69A and taxing the same u/s 115BBE - AO treated the surrendered income as income from other sources as against business income claimed by assessee - HELD THAT:- The assessee declared the income during the survey. The surrendered income was duly declared in the return of income filed u/s 139(1). Considering the nature of surrendered income is excess cash found, excess stock found, expenditure incurred. The revenue was not able to submit any source of income for the assessee other than the business income.
The assessee declared the income and filed the return u/s 44AD of the Act under the presumptive scheme. The assessee declared the surrendered income in the return and all the surrendered income are nature of business transactions.
We fully relied on the order of M/S CHOKSHI HIRALAL MAGANLAL [2011 (8) TMI 1341 - ITAT AHMEDABAD] and M Ganpati Mudaliar [1964 (4) TMI 22 - SUPREME COURT] - Accordingly, the addition made u/s 69A amount to Rs. 49,89,638/- is liable to be deleted and the calculation of tax u/s 115BBE is liable to be quashed. The income of the assessee will be treated as business income. Decided in favour of assessee.
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2023 (6) TMI 1331
Seeking to appoint an arbitrator to adjudicate upon the claims made therein by the petitioner - HELD THAT:- That part of Clause 33 of the agreement between the parties providing for constitution of a Dispute Resolution Committee with a stipulation that before availing of dispute resolution, the disputed amount has to be deposited, is invalid and contrary to law for more than one reason. The first and foremost is that it fetters the right of the petitioner, a party to the arbitration agreement to avail of arbitration which is a statutory right.
If the petitioner is making a claim which is then and there disputed by the respondent, why should the petitioner, being the claimant be asked to deposit the disputed amount? When the petitioner is making a claim against the respondent, it is unable, at that point of time, to know whether the whole claim or part of it would be admitted, or the whole of it denied by the latter. Hence, it is unable to gauge the disputed amount. Even if it were possible for the respondent to notify the disputed amount immediately, the clause would only be operative if the respondent was simultaneously making a counter claim more than the petitioner’s claim which was being denied by the petitioner, by seeking reference of the dispute to arbitration.
If you read Section 12(5) of the said Act along with its 7th schedule, the General Manager or any other employee of the respondent past or present, is disqualified from being an arbitrator on the likelihood of bias.
The arbitration clause provides for appointment of a sole arbitrator by the Chairman of the respondent. If the petitioner also had a right to nominate an arbitrator, then it could have been argued that the General Manager’s power to appoint an arbitrator of his choice was counter balanced by the petitioner’s similar right and the clause adjudged to be valid in terms of CENTRAL ORGANISATION FOR RAILWAY ELECTRIFICATION VERSUS M/S ECI-SPIC-SMO-MCML (JV) A JOINT VENTURE COMPANY [2019 (12) TMI 841 - SUPREME COURT].
Under Section 11 sub-section 6A of the said Act, the court exercising power under Section 11 of the said Act has the power to go into the question of validity of an arbitration agreement - it is held that the part of the arbitration clause providing for appointment of an arbitrator is non-est. Therefore, the arbitration clause between the parties does not contain any valid provision for appointment of an arbitrator. The court has to exercise the power.
This application is disposed off by referring the disputes between the parties as raised in this Section 11 petition and the claim and counter claim that may be filed by the parties in terms thereof to be adjudicated by a learned arbitrator.
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2023 (6) TMI 1330
Addition based on seized materials in Search u/s 132(4) - Addition on the basis of entries in loose slips found during the course of search - addition made by AO towards cash received outside books of accounts - main contention of ld. D.R. is that the statement recorded u/s 132(4)/131 of the Act is self-speaking document and it cannot be overruled - HELD THAT:- Reliability of these statements depends upon the facts of each case and particularly surrounding circumstances and in this case, the lower authorities reached to the conclusion on the basis of assumption resulting into fostering liability on the assessee on the basis of in-advocate material coupled with statement recorded during the course of search since there is no corroborative material to support the contention of the AO.
In the absence of corroborative evidence, merely on the basis of admission in the statement recorded u/s 132(4)/131 of the Act, no addition could be made by AO. The AO failed to bring on record any materials to support his view to make an addition and there was no reason as to why AO did not proceed further to enquire into the unaccounted income as admitted by assessee in statement recorded u/s 132(4) of the Act. This fact was also not taken care of and also no corresponding assets with reference to unaccounted cash receipt was brought on record. In such circumstances, we are not in a position to sustain this addition.
Addition made by AO on the basis of contents in loose slips/scribbling pad is not based on any cogent evidence or unaccounted assets or unaccounted investments unearthed during the course of search, but solely on the basis of assumption and presumptions. In our opinion, suspicion however strong cannot takes place of evidence, which can be used against the assessee.
In the present case, the AO has not made any effort to verify the entries recorded in the loose slips/scribbling pads by making further enquiries and examination/cross examination of the alleged persons or payee of said amount. Further, on perusal of entries in the loose slips/scribbling pads as recorded by AO in the assessment order, we find that nothing was emanating regarding name and address of persons through whom the said amount was received and the parties for which it has been paid. - Decided in favour of assessee.
Addition u/s 69A - Physical cash found in search - Assessee contention that he has been income tax assessee from year to year. This is the accumulated cash balance in the hands of the assessee and the credit to be given - HELD THAT:- The assessee has to place necessary evidence to show the availability of cash balance as on the date of search i.e. 30.8.2017. Once the assessee produce the books of accounts of the entities owned by the assessee as a proprietor, the AO has to give the credit to the extent of cash balance available in the books of accounts of the assessee as on the date of search.
The claim of the ld. A.R. before us was that the assessee received certain amount of cash from his partners Mr. B. A. Ibrahim & Mr. Mohammad Mohideen for which the assessee required to furnish necessary evidence to prove the cash availability on this count. Accordingly, we direct the assessee to produce the cash book relating to the relevant period along with other evidence to prove the availability of cash balance as on date of seizure of this cash i.e. 30.8.2017. If the assessee produces such evidences before AO to prove the cash availability, the AO has to give credence to such evidence or material brought on record by assessee and to decide the issue on that basis. With this observation, we remit the issue in dispute to the file of AO for verification of the relevant evidence.
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2023 (6) TMI 1329
Validity of assessment u/s 153A - due approval was not granted u/s 153D - Tribunal set aside the assessments, pursuant to the approval, on purported reason that there was no application of mind in granting them - HELD THAT:- The approval does not even say the Joint Commissioner had perused the files. As such, the contention sought to be raised in the appeal is covered by Serajuddin and Co. Kolkata [2023 (3) TMI 785 - ORISSA HIGH COURT] as held there is not even a token mention of the draft orders having been perused by the Additional CIT. The letter simply grants an approval. While elaborate reasons need not be given, there has to be some indication that the approving authority has examined the draft orders and finds that it meets the requirement of the law. As explained in the above cases, the mere repeating of the words of the statute, or mere “rubber stamping” of the letter seeking sanction by using similar words like ‘see’ or ‘approved’ will not satisfy the requirement of the law. Decided against revenue.
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2023 (6) TMI 1328
Validity of assessment u/s 153A - due approval was not granted u/s 153 D - Tribunal set aside the assessments, pursuant to the approval, on purported reason that there was no application of mind in granting them - HELD THAT:- As contention raised by revenue in seeking admission of the appeal is covered by Serajuddin and Co. Kolkata [2023 (3) TMI 785 - ORISSA HIGH COURT] as held even the bare minimum requirement of the approving authority having to indicate what the thought process involved was is missing in the aforementioned approval order. While elaborate reasons need not be given, there has to be some indication that the approving authority has examined the draft orders and finds that it meets the requirement of the law.
As explained in the above cases, the mere repeating of the words of the statute, or mere "rubber stamping" of the letter seeking sanction by using similar words like 'see' or 'approved' will not satisfy the requirement of the law.
We find similarity in facts found in the case by the ITAT. The approval does not even say the Joint Commissioner had perused the files. As such, the contention sought to be raised in the appeal is covered by Serajuddin and Co. Kolkata (supra). In the circumstances, the appeal and applications are dismissed.
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2023 (6) TMI 1327
Defective return - Defect notice issued u/s 139(9) - invalidating the return filed - non audit of books of accounts u/s 44AB - Error Description as Tax Payer has shown gross receipts or income under the head “Profits and Gains of Business or Profession” more than Rs.1 crore, however, the books of accounts have not been audited which was not done - assessee filed “e-Nivaran Grievance”, against which response communication was issued invalidating the return filed by the assessee.
HELD THAT:- Appealability of Defect notice - As held in the case of Deere & Company [2021 (11) TMI 503 - ITAT PUNE] has held that the defect notice issued u/s 139(9) is having effect of creating liability under the Act, which the assessee denies or would jeopardize refund. Hence it will get covered within the ambit of sec. 246A(1)(a) of the Act.
Defect notice issued u/s 139(9) is appealable, if the assessee denies its liability or if it would jeopardise the refund. As A.R submitted that the refund of about Rs.5.00 lakhs is stuck in this year due to non-processing of return of income filed by the assessee, we hold that the defect notice issued u/s 139(9) is appealable one. Accordingly, we set aside the order passed by Ld CIT(A) and hold that the assessee could file appeal in the instant case.
Liability to get its accounts audited u/s 44AB - On a perusal of the Profit and Loss account of the assessee for the year under consideration, we notice that the gross business receipts which is less than the threshold limit of Rs.1.00 crore prescribed u/s 44AB of the Act for getting the accounts audited. The Statement of Total income furnished by the assessee would show that the other income has been declared either under the head Capital gains or under the head Other Sources.
Hence, there is merit in the submission of the assessee that it is not required to get its accounts audited u/s 44AB of the Act. Accordingly, we are of the view that the defect notice issued by CPC u/s 139(9) of the Act is not in accordance with law and accordingly, we quash the said defect notice, meaning thereby, the return of income filed by the assessee should be considered as valid return.
Thus response given under “E-Nivaran” would get nullified. Accordingly, we direct the AO/CPC to treat the return of income filed by the assessee as valid return and process the same in accordance with law. Appeal of assessee allowed.
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2023 (6) TMI 1326
Levy of Service tax - Club or Membership Association Service - advance admissions/enrolment fee collected from the respective Members, who apply for club membership - period June 2005 to September 2011 - HELD THAT:- The Hon’ble Supreme Court analysing the leviability of Service Tax on the Membership fees collected by club or association in the case of STATE OF WEST BENGAL & ORS. VERSUS CALCUTTA CLUB LIMITED AND CHIEF COMMISSIONER OF CENTRAL EXCISE AND SERVICE & ORS. VERSUS M/S. RANCHI CLUB LTD. [2019 (10) TMI 160 - SUPREME COURT] held that Companies and Cooperative Societies which are registered under the respective Acts being constituted bodies under this Acts were not included in the Service Tax prior to 1.7.2012.
Thus, the membership fees collected by a registered club or associations is held to be not leviable to service tax. Besides, it is found that this Tribunal in appellant’s own case COMMISSIONER OF CENTRAL TAX, BANGALURU SOUTH COMMISSIONERATE VERSUS M/S KARNATAKA GOLF ASSOCIATION AND M/S. KARNATAKA GOLF ASSOCIATION, BANGALORE VERSUS COMMISSIONER OF SERVICE TAX BANGALORE SERVICE TAX- I [2020 (3) TMI 1098 - CESTAT BANGALORE] decided the issue in favour of the appellant for a different period following the above ratio of the Hon’ble Supreme Court.
There are no merit in the impugned orders and the same is set aside - appeal allowed.
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2023 (6) TMI 1325
Money Laundering - seeking grant of interim bail - bail sought on medical grounds - whether the petitioner is entitled to interim bail as being "sick or infirm" in terms of the proviso to Section 45(1) of the PMLA?
HELD THAT:- Health condition of a human being deserves utmost importance and right to health is one of the most significant dimensions of Article 21 of the Constitution of India. Every person has a right to get himself adequately and effectively treated. The exercise of discretion of the grant of bail is not to be exercised only as a last resort rather freedom is a cherished fundamental right.
Hence, in view of the health conditions of the petitioner, the medical records being furnished on behalf of the petitioner and the same being verified by the ED as authentic, the non-denial of the condition of the petitioner which is worse than the co-accused who has been granted regular bail, and on the perusal of all other precedents this Court finds that the petitioner is suffering from life-threatening diseases warranting immediate medical attention and post-operative care. This Court is of the opinion in view of the aforesaid discussion, the petitioner's case satisfies the test of the proviso to Section 45(1) of the PMLA.
This Court has also appreciated the other factors as required to be considered while granting bail to an accused. It is evident that there is nothing on record to show that the liberty granted to the petitioner has been misused by him during his previous interim bails and neither has he been found to be an absconder.
The petitioner is admitted to interim bail for a period of six weeks on his furnishing a personal bond in the sum of Rs.10,00,000/- with two sureties of the like amount to the satisfaction of the Trial Court concerned, subject to the conditions imposed - application is disposed of.
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2023 (6) TMI 1324
Grant of Regular bail - bail sought on medical and humanitarian grounds for a period of 3 months alleging precarious health of the petitioner - whether the petitioner, who is in custody, is entitled to interim bail on medical grounds? - HELD THAT:- Article 21 of the Constitution provides for protection of life and personal liberty. The said right cannot be curtailed "except according to procedure established by law". The liberty of a person who is accused or convicted of an offence can be curtailed according to procedure established by law. However, right to health is also recognized as an important facet of Article 21 of the Constitution. Merely because a person is an under trial or for that matter even a convict, lodged in jail, this facet of right to life cannot be curtailed. It remains an obligation of the state to provide adequate and effective medical treatment to every person lodged in jail, whether under trial or a convict.
A Co-ordinate Bench of this Court in Kewal Krishan Kumar V. Enforcement Directorate, [2023 (3) TMI 746 - DELHI HIGH COURT], referring to the relevant clauses of the Finance Bill introduced on 1st February, 2018 for amending Section 45 of the PMLA, observed that a purposive interpretation of the proviso to section 45(1) shows that it has been incorporated as a lenient provision or to afford 'relaxation' to a sick or infirm person as noted in the Statement of Objects and Reasons to PMLA.
The power to grant bail on medical grounds under the first proviso to Section 45(1) of the Act is discretionary, therefore, the same has to be exercised in a judicious manner guided by principles of law after recording satisfaction that necessary circumstances exist warranting exercise of such a discretion.
In the absence of an opinion of the experts it is difficult for this Court to come to the conclusion as to whether it is a case for grant of interim bail on the medical grounds. The Court cannot assume the role of an expert and make assessment of its own as regard the medical condition of the petitioner on the basis of medical records placed on the Court file - on humanitarian grounds, the medical condition of the petitioner as articulated in the affidavit of petitioner's wife cannot be simply brushed aside given the fact that there is material on record suggesting that the petitioner is heart patient, as well as having spine related issues, besides other ailments
This Court deems it appropriate, to constitute a medical board to evaluate the medical condition of the petitioner - List on 12.06.2023.
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2023 (6) TMI 1323
CENVAT Credit - services received in relation to effluent treatment of the industrial waste - denial of credit on the ground that the effluent treatment activity is post manufacture and the same is not used in or in relation to manufacture of final product accordingly - HELD THAT:- Even though the effluent treatment is not directly connected with the manufacture of final product of the appellant but as per the pollution control act the appellant is bound under the law to carry out the effluent treatment of the Industrial waste generated during the course of manufacture of their final product. As per the provision of Pollution Control Act, if the effluent generated in the manufacture is not treated the appellant shall not be liable to run their factory.
In this undisputed position, the effluent treatment activity is necessary to carry out the uninterrupted production of the final product in the appellant’s factory therefore, it can be conveniently draw the conclusion that the effluent treatment activity is a vital part of overall manufacturing of the final product if this be so then the input services used for effluent treatment are admissible input service.
This issue is no longer res-integra as in the various judgments the services related to effluent treatment has been held as admissible input service and cenvat credit was allowed - In case of COMMISSIONER, CENTRAL EXCISE & SERVICE TAX, SURAT-II VERSUS MI/S KANORIA CHEMICALS & INDUSTRES LTD. [2015 (7) TMI 970 - CESTAT AHMEDABAD] this tribunal dealt with the similar fact held that treatment of effluent from a factory has to be considered as essential and integral part of the process of manufacture.
In case of M/S. WIPRO ENTERPRISES (P) LTD., (FORMERLY ‘M/S. WIPRO LTD. ’) VERSUS THE COMMISSIONER OF G.S.T. & CENTRAL EXCISE, [2018 (12) TMI 1167 - CESTAT CHENNAI] this tribunal’s Chennai Bench on the issue of credit on water treatment held that demand raised on Water Treatment Service and Garden Maintenance Service for the period January 2015 to December 2015 is set aside
Thus, it can be seen that the issue is no longer res-integra as the services availed in respect of effluent treatment plant for treatment of industrial waste is in relation to the overall manufacturing activity of the appellant’s final product in the appellant’s factory therefore, the said services are input service hence, the credit is admissible.
Appeal allowed.
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