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Showing 161 to 180 of 1471 Records
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2022 (1) TMI 1314
TDS u/s 195 - amount paid towards refurbishment / reconstruction charges - non-deduction of TDS - addition u/s 40(a)(i) - As argued amount paid towards refurbishment / reconstruction is not in the nature of fee for technical services covered u/s.9(1)(vii) of the Act as refurbishment activity is in the nature of reconstruction / repair and accordingly no TDS is deductible on this expenditure - HELD THAT:- As evident that the assessee company is in the business of generation and sale of electricity. The assessee owns and operates a 330.5MW combined cycle power plant. To run this cycle power plant, the necessary machinery like gas turbine including spare parts viz., HGPS consisting of Combustor Baskets, Transition pieces, Fuel Nozzles, Turbine Static Blades and Turbine Moving Blades with each component having a pre- defined standard life based on Equivalent Operating Hours (EOH) is purchased.
The process as explained above including the details of machinery, there is service agreement for refurbishment / repair of these machines entered with Marubeni Corporation, Japan. This refurbishment from the above facts is clear that is only repairs and services of machinery.
Thus where discussion of AR as well as ld.senior DR, we are of the belief that payments for repairs are outside the scope of FTS and such payment do not constitute FTS u/s.9(1)(vii) of the Act. These are simple refurbishment or repairs and payment made for these do not attract TDS provision u/s.195 of the Act. Accordingly, we are of the view that this issue stands covered in favour of the assessee. Hence, the CIT(A) has rightly deleted the addition and we confirm the same. Therefore, the Revenue’s appeal is dismissed.
Disallowing deduction u/s.80IA in respect of interest on bank deposits - interest on TRA deposits placed with the bank, as the same was a requirement of the financing document - HELD THAT:- We find that this issue is squarely covered by the Tribunal’s order in assessee’s own case for earlier assessment years 2006-07 to 2008-09 [2015 (5) TMI 1244 - ITAT CHENNAI] Therefore, taking a consistent view, we confirm the order of lower authorities and dismiss the cross objection filed by the assessee.
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2022 (1) TMI 1313
Cartelization - representation alleged that when natural rubber price increased, the tyre prices were increased in a concerted manner by the domestic major tyre manufacturers, however, when the price of natural rubber decreased, the tyre prices were not reduced by the domestic major tyre manufacturers and as such, they indulged in price parallelism and cartelization - Section 3 of the Competition Act, 2002.
Whether the reference made under Section 19(1)(b) of the Competition Act is invalid and non est in law? - Whether Regulation 15(3) is mandatory or directory? - HELD THAT:- A conjoint reading of Regulation 15(3), Regulation 15(5), Regulation 40 and Section 15(c) would indicate the clear wisdom of the Legislature that the non compliance of the regulations in each case shall not invalidate the proceedings initiated by the CCI. Only in two situations, namely, if there is an irregularity or non compliance of the procedures affecting the merits of the case, Regulation 15(3) will come into operation. Secondly, if there is any irregularity or non compliance of the procedures or regulations resulting in miscarriage of justice alone, Regulation 15(3) will take effect. In all other cases not affecting the merits of the case or causing miscarriage, the non compliance of the regulations will not invalidate the proceedings before the CCI.
The Apex Court in STATE OF PUNJAB AND ANOTHER VERSUS SHAMLAL MURARI & ANR [1975 (10) TMI 105 - SUPREME COURT] has settled this issue holding that while dealing with procedural law, we must always remember that procedural law is not to be a tyrant, but a servant, not an obstruction, but an aid to justice. This legal position has been reiterated by the Apex Court in yet another decision in RANI KUSUM VERSUS KANCHAN DEVI & ORS. [2005 (8) TMI 709 - SUPREME COURT].
When the Competition Commission has proceeded to order investigation after forming an opinion that a prima facie case exists, the rights of the parties cannot be complained of being affected in any manner at this stage, because the order for investigation does not attract any civil consequences, inasmuch as it does not determine the issue raised against the parties finally. Although certain procedural lapses take place while arriving at such a prima facie opinion, that itself will not make the entire proceedings invalid, because the parties are given opportunities to take part in the investigation and thereafter to submit their objections before the Commission, to enable the Commission to arrive at a just and proper conclusion and pass a final order under Section 27 - the view taken by the learned single Judge that the writ Court cannot interfere with the preliminary order directing investigation on the ground of procedural lapses either in making the reference or entertaining the same, does not call for any interference by this Court.
Whether the order dated 24.6.2014 passed by the Commission under Section 26(1) of the Competition Act, shall be liable to be quashed? - HELD THAT:- The allegations of the AITDF in the representation dated 28.11.2013 to the MCA were that the opposite parties, having control over 90% of the tyre production in India, are engaged in abusing their dominant position through price parallelism under the aegis of cartel association-Automotive Tyre Manufacturers' Association (ATMA) and also raising the prices of tyres and tubes on the pretext of increase in the price of natural rubber and other inputs, but the subsequent reduction in the price of the raw material has not been followed by the corresponding decrease in the price of tyres, resulting in huge loss to the innocent public - Moreover, whether the order or direction issued under Section 26(1) of the Competition Act is appealable or not, is concerned, the said issue is no longer res integra. While considering the very same issue, the Apex Court in Competition Commission of India v. Steel Authority of India Limited, [2010 (9) TMI 215 - SUPREME COURT] has held vividly that the order or direction issued under Section 26(1) after forming a prima facie opinion is a direction simpliciter to cause an investigation in the matter and it does not effectively determine any right or obligation of the parties to the lis, because it passes the interim order or direction at the preliminary stage without recording a finding which would bind the parties and it would not make the direction as an order which affects the rights of the parties and therefore, is not appealable.
Whether the complaint/reference made by the fourth respondent-AITDF is hit by the principles of res judicata? - HELD THAT:- The AITDF made a complaint against the appellant and others relating to the year 2011-12, 2012-13 and 2013-14. Since the present complaint is not related to 2008, whereas it alleges that the appellant and others have indulged in cartelization during the period from 2011-12 to 2013-14 by indirectly determining the sale of tyres and tubes in the domestic market contravening the provisions of Section 31 read with Section 33 of the Competition Act, the CCI is empowered to inquire into the fresh complaint for each year, for, Section 27 of the Competition Act empowers the CCI to pass an adjudicatory order for each year of cartelization.
The principles of res judicata may not apply, inasmuch as the expression 'for each year of the continuance of such agreement', the CCI is empowered to investigate the complaint of cartelization, as it concerns with each year. Moreover, if the CCI taking up the complaint for the year 2008, finding want of acceptable evidence, dismissed the complaint for the year 2008, it does not mean that the same CCI is precluded from entertaining a fresh complaint for the next year against the same producer or distributor, trader, etc., by virtue of Section 27. When the Act permits the CCI to initiate action on the complaint of cartelization independently for each year, the argument of the appellant on the principles of res judicata cannot be accepted. This issue is also answered against the appellant, accordingly.
Whether the conduct of the ninth respondent-ATMA in approaching the Delhi High Court for the relief would amount to forum shopping? - HELD THAT:- When this Court has directed the final order to be kept in a sealed cover and accordingly, the CCI also has complied with the order by keeping the above order in a sealed cover, instead of approaching this Court, discreetly approaching the Delhi High Court with the writ petition would amount to abuse of the process of law, for the simple reason that what shall not be done directly cannot be done indirectly - since the investigation as ordered by the CCI has already been completed and the report of the investigating officer has also been submitted before the Commission and all the parties have also taken part in the proceedings before the Commission and advanced their arguments and that the final order passed by the CCI is also kept in a sealed cover as per the order dated 8.3.2018 passed by this Court, after getting the said final order, the parties, who are likely to be aggrieved, have to work out their remedy in the manner known to law. Therefore, at this final stage, the Court should, as far as possible, avoid any decision which would bring about the result of rendering the system unworkable in practice.
There are no merit in the appeal and accordingly, the writ appeal stands dismissed.
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2022 (1) TMI 1312
Jurisdiction - Relegation to file a petition for execution of a money decree dated 7th February, 2006 (in excess of Rs. 20 lakhs) of a foreign Court indisputedly notified as a superior Court of a reciprocating territory before the District Court in view of Section 44A of the Code of Civil Procedure, 1908 - HELD THAT:- It is not disputed that so far as the expression “superior Court of any reciprocating territory” as defined under Section 44A of the Code is concerned, the judgment and decree dated 7th February, 2006 has been passed by the notified superior Court of the reciprocating territory, namely, United Kingdom of Great Britain and Northern Ireland within the meaning of Section 44A of the Code vide notification dated 1st March, 1953 issued by the Ministry of Law, thus it leaves no doubt that the decree of the High Court of England would be considered to be a decree of superior Court of a reciprocating territory.
Section 44A of the Code provides for execution of decrees passed by the foreign Courts in reciprocating territories. It, inter alia, stipulates that where a certified copy of a decree of any of the superior Court of any reciprocating territory has been filed in a District Court, the decree may be executed in India as if it had been passed by a District Court. Together with the certified copy of the decree, a certificate from such superior court is to be filed stating the extent, if any, to which the decree has been satisfied or adjusted. Such a certificate is the conclusive proof of the extent of such satisfaction or adjustment - The ordinary original civil jurisdiction of the High Court is always exercised, based on pecuniary limits. It would be impossible to read into Section 44A of the Code that even though the pecuniary jurisdiction of Civil Court is restricted, still for the purpose of execution of a foreign decree, it becomes the District Court in respect to those matters which fall within the ordinary original civil jurisdiction of the High Court and the expression “district” defined under Section 2(4) of the Code will have to be given its true effect.
The Division Bench has proceeded on the basis of the expression “District Court”, as being referred under Section 44A of the Code but it has not taken into consideration the other relevant provisions of which a reference has been made by us while coming to the conclusion that the expression “District” as defined under Section 2(4) of the Code only lays down the limits of the jurisdiction of the principal civil Court of original jurisdiction and that includes the ordinary original civil jurisdiction of the High Court and once the pecuniary jurisdiction exceeds as being notified under the relevant statute, the jurisdiction vests exclusively with the High Court as an ordinary original civil jurisdiction for execution of a foreign decree under Section 44A subject to the just objections which are available to the parties/judgment debtor as envisaged under Section 13 of the Code.
Appeal allowed.
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2022 (1) TMI 1311
Seeking leave to defend - case of the appellant had been that it had no liability towards the plaintiff - whether the plaintiff was entitled to maintain a summary suit under Order XXXVII CPC for the claim in question? - HELD THAT:- The question as to whether the appellant was acting only as an agent of defendant No. 1 in relation to the supplies in question and had no monetary liability, as sought to be raised by the appellant, could be a matter of his defence. This aspect, relating to the nature of defence shall be examined in the next question but, such a proposition of defence by the appellant cannot take away the entitlement of the plaintiff-respondent No. 1 to maintain the summary suit in terms of Order XXXVII CPC. This is apart from the fact that while asserting joint and several liability of the defendants, the plaintiff has also relied upon the cheques said to have been issued by defendant No. 1, which were allegedly not presented as per the request of the said defendant No. 1.
The contention against maintainability of the summary suit in terms of Order XXXVII CPC cannot be accepted and to that extent, we find no reason to consider any interference in the decision of the High Court.
Leave to defend - HELD THAT:- The High Court has observed that the appellant would not be entitled to such leave because no triable issues were arising out of the defence sought to be taken by the appellant. The High Court has also observed that the defences were frivolous and vexatious; and were raised only in order to deny the just dues of seller of the goods, i.e., the plaintiff. According to the High Court, while applying the principles for grant of leave to defend, as delineated in the case of IDBI Trusteeship (supra), the appellant was not entitled to the leave to defend.
Thus, it could be seen that in the case of substantial defence, the defendant is entitled to unconditional leave; and even in the case of a triable issue on a fair and reasonable defence, the defendant is ordinarily entitled to unconditional leave to defend. In case of doubts about the intent of the defendant or genuineness of the triable issues as also the probability of defence, the leave could yet be granted but while imposing conditions as to the time or mode of trial or payment or furnishing security. Thus, even in such cases of doubts or reservations, denial of leave to defend is not the rule; but appropriate conditions may be imposed while granting the leave - while dealing with an application seeking leave to defend, it would not be a correct approach to proceed as if denying the leave is the rule or that the leave to defend is to be granted only in exceptional cases or only in cases where the defence would appear to be a meritorious one. Even in the case of raising of triable issues, with the defendant indicating his having a fair or reasonable defence, he is ordinarily entitled to unconditional leave to defend unless there be any strong reason to deny the leave.
The appellant-defendant No. 2 ought to have been granted the leave to defend the claim made in the suit concerning its liability; and to this extent, the impugned decree deserves to be set aside - Appeal allowed.
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2022 (1) TMI 1310
Revision u/s 263 - Owing to non-addition of the amount adjusted by the TPO in his order passed u/s 92CA by the Assessing Officer PCIT passed order u/s 263 - HELD THAT:- The reference to the TPO to determine the Arm’s Length Price is not an empty exercise to be undertaken by the revenue but to bring to tax the difference determined by the TPO with regard to the Arm’s Length Price. While the TPO order passed u/s 92CA determine upward adjustment we find that the AO has erred in holding that the adjustment by the TPO in respect of international taxation with the AE is Nil.
Thus, the order passed by AO is erroneous insofar as it is prejudicial to the interest of revenue. Hence, the ld. PCIT in accordance with the provisions of the Act has given an opportunity of being heard to the assessee, determined the amount of the adjustment made by the TPO that was not brought to tax and set aside the order of the AO directing him to rectify the order to the extent of the adjustment made by the TPO. Since, the order of the PCIT has been rightly based on the order of the TPO which has been ignored by the Assessing Officer, we hold that the order of the AO is erroneous and prejudicial to the interest of the revenue and hence decline to interfere with the order of the ld. PCIT. Appeal of the assessee is dismissed.
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2022 (1) TMI 1309
Reopening of assessment u/s 147 - deduction u/s 80P - Assessement reopened within a period of 4 years - scope of change of opinion - HELD THAT:- It is true that the AO has drawn inference from the examination of the record that the original order of assessment is erroneous which has probably resulted due to the failure on the part of the assessee to disclose fully and truly all material facts relevant for the assessment. We have consciously applied our mind to the relevant facts and material available. We find that it is true that the once assessment made on material available or existing at the relevant point of time while making assessment and again on same material, if different or divergent view is sought, it would tantamount to “change of opinion’’, but at the same time even in the case of existing material, if no conscious attempt has been made by the AO, it would at the most tantamount to mistake in not considering the relevant point or proposition and it would not certainly not fall in category of “change of opinion”.
On bare appreciation of the audit report, one cannot overlook sight of the fact that the assessee has very conveniently mentioned under the head of deduction by referring to Section 80P and the reply which was submitted on record at the stage of scrutiny assessment. At first instance, it gives an impression that the writ applicant assessee has derived interest from it’s own members. This Court finds that the writ applicant had failed to disclose ‘fully and truly’ all material facts necessary for assessment, more particularly, to examine the nature of transaction vis-a-vis the deduction under Section 80P (a)(i) and Section 80P(2)(d). The Court further finds that in fact it was the duty of the assessee to make fully and truly material disclosure at the time of assessment.
Mere production of the audit report without further reference of the interest derived from other than Cooperative Societies would not fall in the category of material evidence which the Assessing Officer with due diligence could have discovered and therefore, the Assessing Officer has rightly invoked proviso to Section 147 of the Act having satisfied for formation of belief which has bearing on the question of escape of income of the assessee from the assessment because of his failure or omission to disclose fully and truly all material facts.
In the given case, the assessment has been reopened within a period of 4 years and therefore, the proviso to Section 147 has no application. This Court finds that the reasons recorded by the Assessing Officer which led to the formation of the belief contemplated by the proviso to Section 147 of the Act has material bearing on the question of escapement of income of the assessee from the assessment because of failure of the assessee or omission to disclose the fully and truly all material facts. We are of the view that though the material was available on record, at the time of first assessment, when no conscious consideration of the material is made and a mistake has been committed, it would not, in any case create an embargo on the power of the Assessing Officer to exercise powers under amended section 147 of the Income Tax act, 1961, as there could not be “change of opinion”, in the factual scenario. The only requirement is to see that the escapement of income which the Court finds in the given case and therefore, we hold that the notice issued under Section 148 is a valid notice. - Decided against assessee.
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2022 (1) TMI 1308
Levy of penalty - whether the proceedings concluded before the authority was without complying with the principles of natural justice? - HELD THAT:- The mahazar indicates that the DVD was copied from a pen drive. The contents of the DVD can be contradicted with the pen drive alleged to be in possession of the appellant. We cannot find that prima facie there was a denial of any natural justice to the appellant while concluding the proceedings before the authority. In the absence of any serious lapse in concluding the proceedings, this Court under Article 226 will not be justified in interfering with such matters. We concur with the findings made by the learned Single Judge.
Appeal dismissed.
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2022 (1) TMI 1307
Application to MUDA seeking cancellation of allotment - HELD THAT:- The trial Court has recorded a finding that the question of granting sanction for prosecution of accused Nos. 4 to 6 which includes the present petitioner does not arise on the following grounds, viz.,
(a) That the elected representative is elected by the people and not appointed by any person and accordingly, no person including the Speaker is competent to remove the MLA/MP from his office and therefore, the question of granting sanction for prosecution of accused Nos. 4 to 6 does not arise at all.
(b) That accused Nos. 4 to 6 were the then Members of MUDA and no sanction to prosecute them is required under the provisions of pre-amended Prevention of Corruption Act, 1988.
The trial Court has further proceeded to take note of the charge sheet and enclosures and has opined that prima facie there are sufficient material to take cognizance of the offences alleged and has ordered to proceed against accused Nos. 1 to 24 and while taking cognizance of the offence, has directed issuance of summons to accused Nos. 1 to 24.
Insofar as the conclusion that no sanction is required as against the petitioner, the conclusion of trial Court is indeed correct and could be supported by virtue of the reasoning as made by this Court in the present order - The conclusion arrived at is correct and it would 'secure the ends of justice' to leave the order of the trial Court undisturbed. However, the observation made as noticed at point (a) above may not be correct, as it is the settled position of law that the Speaker would be the competent Authority to grant sanction for prosecution as regards the elected representatives.
It is clear that the conclusion arrived at by the trial Court is correct. The defect in reasoning in arriving at such conclusion is liable to be ignored and would require to be so done in order to secure the ends of justice, which would be consistent with the exercise of jurisdiction under Section 482 of Cr.P.C.
Petition dismissed.
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2022 (1) TMI 1306
TP Adjustment - downward adjustment to the value of international Transaction of Finance & General administration related service charges - Reference to threshold of business needs / requirements of the assessee - HELD THAT:- Assessee has availed bundle of services from its AE and made payment pursuant to the terms of the agreement. These payments are recurring in nature and are determined by applying specific allocation keys.
TPO, while accepting that all the other services benefitted the assessee, termed the services of finance / general management to be in the nature of stewardship services and alleged that the assessee did not submit any evidence of the receipt of services disregarding the fact that these services were emanating from the same agreement.
The rendering of services was duly evidenced by the agreement as well as debit notes issued against the assessee. The copies of email / correspondences to support the receipt of services were duly furnished (43 to 88 of paperbook). Another observation of TPO is that the assessee may not be requiring these services in the normal course of business. The same, in our opinion, is not correct approach since the role of Ld. TPO was limited to determine the ALP of the transactions and not to adjudge the same at the threshold of business needs / requirements of the assessee.
TPO observed that the transaction was to be benchmarked applying CUP method, however, no effort has been made to determine the ALP of the transaction using CUP method. Simply determining the ALP to be nil on the basis that the services were not required to be availed and not determining ALP without applying any of the prescribed method is not in accordance with statutory mandate.
TP provisions mandate application of any of the prescribed method to arrive at Arm’s Length Price of the international transactions.
See case Flakt (India) Ltd. [2016 (6) TMI 557 - ITAT CHENNAI] wherein it was held that in the absence of any comparison of the transaction with transaction carried out in uncontrolled market, Ld. TPO could not independently come to conclusion that volume and quality of services was disproportionate to the payment made by the assessee. The estimation of the services rendered and costs of such service was outside the scope of transfer pricing adjustment.
CIT-DR has referred to the decision Bombardier Transportation India Pvt. Ltd. [2015 (11) TMI 1527 - ITAT DELHI] which is factually distinguishable since in that case the assessee could not file sufficient documentary evidences and the adjustment was partially confirmed.
Lastly, it is an uncontroverted fact that the assessee has paid for these services in earlier years also which has been accepted by the revenue and this is the first year in which such an adjustment has been proposed. Therefore, the value of impugned transactions, in our considered opinion, could not be taken to be nil in this year.
We would hold that the TP adjustment as made by Ld. AO in the final assessment order could not be upheld in the eyes of law. By deleting the same, we allow the appeal.
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2022 (1) TMI 1305
Cancellation of registration of petitioner - opportunity of hearing not provided - HELD THAT:- Though the learned counsel for the respondent would contend that the order of cancellation observes that the reply and submissions of the petitioner has been examined at the time of hearing that by itself would not indicate that the petitioner was present during the hearing of the proceedings leading to cancellation of registration. It is clear as per the proviso to Section 29(2) of KGST Act that there shall not be cancellation without giving the person an opportunity of being heard in light of the statutory mandate and in absence of any material evidence, presence of the petitioner during the proceedings for cancellation of registration.
The order of cancellation at Annexure-A is set aside and matter is remitted to respondent No.2 for reconsideration of the proceedings relating to cancellation of registration - the petition is disposed off.
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2022 (1) TMI 1304
TP Adjustment - segment reporting in the financial of the taxpayer that established its action of distributing of revenue between foreign AE and non-AE as genuine allocation - HELD THAT:- The assessee has enclosed the export segment results, indicating that the assessee has made operating prof it in its export sales. A duly certified segment accounts by a Chartered Accountant is enclosed as an annexure to this submission, which proves that the assessee has earned margin of 0.74% on overall export sales to AE segment as against the margin of 0.39% on export sales to non-AE segment.
CIT(A), in view of the above submission, relying on the judgment in the case of Birla Soft India Ltd. [2013 (11) TMI 417 - ITAT DELHI] as directed the TPO/AO to determine the ALP of the international transactions with the AE by making internal comparison of the net margins earned by the appellant from international transaction with AE and margin earned by the AE from international transactions with unrelated parties. AO/TPO was further directed to calculate the costs of the segments on the basis of the certificate of the CA which has not been objected by the TPO on the remand report. Appeal of the revenue is dismissed.
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2022 (1) TMI 1303
Seeking grant of Bail - procedure under Section 19 PMLA was followed or not - Enforcement Directorate can be complainant and the Investigating Officer at the same time or not - effect of declaration of twin conditions under Section 45 of the PMLA have been declared unconstitutional and ultra virus - it was held by Delhi High Court that Issue decided in the case of MUKESH SINGH VERSUS STATE (NARCOTIC BRANCH OF DELHI) [2020 (9) TMI 419 - SUPREME COURT] where it was held that merely because the informant is the investigator, by that itself the investigation would not suffer the vice of unfairness or bias and therefore on the sole ground that informant is the investigator, the accused is not entitled to acquittal.
HELD THAT:- We decline to interfere in this special leave petition. The special leave petition is accordingly dismissed.
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2022 (1) TMI 1302
Clandestine manufacture and removal of goods - the demand has been made based on the booking registers by the transporter supported by the statements of the transporter - Section 9 - Relevancy of statement - HELD THAT:- Every booking may not result in the goods actually being received and dispatched. Whenever the goods are received he makes the entry in the GR register and he would also make a corresponding entry of invoice number, etc. in the booking registers. It is for this reason that is in the booking register, against some entries there are invoice numbers while against others they are not. So far as the GR register is concerned, it matches with the GR issued by the transporter and the corresponding invoices.
Even in cases, where the entries in the booking registers show corresponding invoice numbers (evidencing payment of duty), a demand has been made.
We find it impermissible to allege clandestine manufacture and removal and demand duty from the assessee merely because there are entries in the booking register made by the transporter who, during cross-examination has confirmed that these are merely tentative entries and do not reflect actual transportation of the goods.
Reliance upon the electricity consumption - HELD THAT:- The next submission of the Revenue is that electricity consumption by the assessee on Sundays was the same as on the other days which implies that there was, indeed, clandestine manufacture because no production was recorded on their registers on Sundays. Learned Counsel for the appellant is correct in pointing out the readings of AVVNL, Ajmer pertain to May, June and July 2012 whereas the booking registers on the basis of which this part of the demand is raised pertains to a period of almost two years earlier. Therefore, the report from the AVVNL does not substantiate the allegation of clandestine removal based on the booking registers of the transporter.
No prudent man can on the basis of these pieces of evidence, assume that the assessee has manufactured goods valued at about Rs. 50 crores and cleared them clandestinely.
Appeal of the revenue rejected.
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2022 (1) TMI 1301
TP Adjustment - Comparability - exclusion of one comparable entity i.e., M/s Cosmic Global Limited from final set of comparable entities as adopted by Transfer Pricing Officer (TPO) - HELD THAT:- Upon perusal of Tribunal’s order in assessee’s own case for AY 2010-11 [2018 (4) TMI 1934 - ITAT CHENNAI] we find that the assessee sought exclusion of this entity and the matter was remitted back to the file of Ld. TPO/ AO for fresh examination.
Pursuant to this order, TPO has passed an order on 25.10.2019 wherein this entity has been excluded. Therefore, finding strength in the argument of Ld. AR, we remit the matter back to the file of Ld. TPO / AO on similar lines as done by co-ordinate bench in AY 2010-11 for the limited purpose of examining assessee’s claim for exclusion of M/s Cosmic Global Ltd. The grounds raised thus stand partly allowed for statistical purposes.
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2022 (1) TMI 1300
Levy of GST - supply or not - transfer of Leasehold land which includes other services such as Electricity Line, Water Line, Drainage Line, Road, Sewerage Line etc. like in case of plotted development - transfer of ownership of Freehold land which includes other services such as Electricity Line, Water Line, Drainage Line, Road, Sewerage Line etc. like in case of plotted development - Annual Lease Rent - whether service provider can claim ITC on their inward goods and services?
HELD THAT:- The development work done by the applicant is for whole parcel of land under Area Based Development and not for a given plot which is being sold to the buyer. RSCCL have been assigned with powers vested with Ranchi Municipal Corporation and the Area Based development of 647.30 Acres land under Smart City Mission is being done by RSCCL under the capacity and powers vested with Ranchi Municipal Corporation, assigned to them by Government of Jharkhand. The Central Government and Jharkhand Government have provided grants to RSCCL for Area Based Development of land.
It appears that the activity of the appellant is absolute sale/ lease of land. The RSCCL are realizing only the price of land/ lease amount from the buyer/ lessee and the development cost of 647.30 Acres of land is borne by the Government. The development of individual plots by way of obtaining water/ drainage/ power connection or construction and maintenance of any road or electric installation etc. is the responsibility of the buyer. The sale of land is neither supply of goods nor supply of service as per Serial No. 5 to the Schedule III of CGST Act.
The applicant are not liable to pay tax on the amount received by them against allotment of land on free hold basis for the entire consideration amount of sale deed/ e-auction bidding amount.
Financial Business Area in not been defined in the statute. However, in common parlance, Financial Business Area or Financial District or Central Business District is often the commercial and business centre of a city, having a number of financial firms. The Government of Jharkhand, in association with Government of India, is developing Smart City with the concept of having Industrial Zones, Commercial Zones, Residential Zones, Public/ Semi-public Zones and Mixed Use Zones.
The leasing of industrial plots or plots for development of infrastructure for financial business by RSCCL, a Government entity, to the industrial units or the developers in this Area Based Developed property for commercial/ mixed use is exempted from the tax. In cases other than that, the applicable rate of Goods & Services Tax in case of leasing services is 18%.
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2022 (1) TMI 1299
Seeking grant of interim bail - Look Out Circulars(LOCs), Non-balable warrants of arrest and Proclamations under Section 82 of the Code of Criminal Procedure have been issued against the family members of the petitioner - HELD THAT:- This Court on 16.02.2021 directed the State counsel to file an affidavit of the Superintendent of Police of the concerned area explaining the efforts made so far to arrest the absconding accused-family members of the petitioner - In compliance of the said direction, the respondent – state has filed an affidavit indicating therein that Look Out Circulars(LOCs), Non-balable warrants of arrest and Proclamations under Section 82 of the Code of Criminal Procedure have been issued against the family members of the petitioner.
All these facts and the subsequent developments and more particularly the fact that the petitioner has already suffered incarceration for a period of seven and a half years and has not breached any of the conditions imposed by the High Court, it is deemed appropriate to make the interim bail granted to the petitioner by the High Court vide order dated 28.09.2020 absolute subject to the conditions to be imposed by the trial court - If the petitioner violates any of the conditions imposed by the trial Court, the respondent – State would be at liberty to move an application for cancellation of bail.
SLP disposed off.
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2022 (1) TMI 1298
Interpretation of statute - Section 17(2)(a) of the ESIC Act 1948 - Rejection of petition filed by the appellant against the promotion of the contesting respondents, to the post of Associate Professor under the Dynamic Assured Career Progression DACP Scheme - determination of applicable rules/regulations for promotion of the contesting respondents from the post of Assistant Professor to Associate Professor namely, the ESIC Recruitment Regulations 2008, the DACP Scheme or the ESIC Recruitment Regulations 2015.
HELD THAT:- The ESIC Recruitment Regulations 2008 and ESIC Recruitment Regulations 2015 have statutory effect by virtue of Section 97(3) of the ESI Act. It is settled law that regulations framed by statutory authorities have the force of enacted law. A Constitution Bench in SUKHDEV SINGH VERSUS BHAGATRAM SARDAR SINGH RAGHUVANSHI [1975 (2) TMI 111 - SUPREME COURT] considered the regulations framed by several statutory authorities considered as “State” within the terms of Article 12.
The CAT and the High Court failed to notice the applicability of the ESIC Recruitment Regulations 2015 to the promotions of the Teaching Cadre in the appellant corporation. The ESIC Recruitment Regulations 2015 have precedence over the Office Memorandum dated 29 October 2008 which implemented the DACP Scheme in respect of officers of the Central Health Service under the Union Ministry of Health and Family Welfare. The concession by the Counsel of the appellant before the CAT does not stand in the way of the appellant supporting the correct position of law before this Court - the contesting respondents did not challenge the ESIC Recruitment Regulations 2008 or the ESIC Recruitment Regulations 2015 before the CAT or the High Court. The argument on lack of prior approval as per Section 17(2) of the ESI Act is obviated by the preamble to the ESIC Recruitment Regulations 2015.
The revised seniority list of the Teaching Cadre at the appellant corporation should reflect the promotions of the contesting respondents in accordance with the ESIC Recruitment Regulations 2015 and not the DACP Scheme - Appeal allowed.
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2022 (1) TMI 1297
Revision u/s 263 by CIT - PCIT has called for proposal from the JCIT/Assessing Officer to exercise jurisdiction under Section 263 - HELD THAT:- After noting the said decision the Tribunal points out that the appellant department has not controverted the contents of the letter of the Joint Commissioner of Income Tax dated 18th August, 2016 and has recorded that the said letter clearly brings out that the PCIT has called for proposal from the JCIT/AO to exercise jurisdiction u/s 263 - Therefore, Tribunal concluded that the PCIT has not exercised jurisdiction u/s 263 of the Act himself, but he exercised jurisdiction at the instance of the Assessing Officer/JCIT, which is against the provisions of law.
The argument made by the learned Standing Counsel is that it is the PCIT who has exercised jurisdiction under Section 263 of the Act. From the order passed by the Tribunal we find that the department could not controvert the contents of the letter dated 18th August, 2016. If, according to the department, the contents of the letter were otherwise, then it is for the department to approach the Tribunal for necessary rectification or clarification and the correctness of the order of the Tribunal cannot be decided by us in an appeal under Section 260A of the Act by bringing certain submissions which were never made before the Tribunal. Therefore, we are not inclined to interfere with the order passed by the Tribunal and accordingly, the appeal is dismissed. However, we leave it open to the appellant/department to approach the Tribunal for clarification or rectification of the order, if they are so advised.
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2022 (1) TMI 1296
Clandestine manufacture and clearance - Sir Brand Pan Masala and Gutka - shortage of cenvatable inputs being used in the manufacture of finished goods as per stock record, being the packing materials/laminates - Demand of futy Rs. 2,98,262/- on M/s Seema - cross-examination of statements relied upon - confiscation as per provisions of Rule 25 of Central Excise Rules, 2002 recovery of Excise Duty under Section 11A (1) of the Central Excise Act - Demand-cum-Show Cause Notice issued - demand of Duty Rs. 1,60,377/- from M/s Seema Enterprises with penalty on i) RIL Rs. 5,000/- ii) Abhishek Sales Rs. 50,000/- iii) Nath & Co. Varanasi Rs. 1,00,000/- - Demand-cum-Show Cause Notice issued vide C.No.121/INT/DGCEI/ HQ/07/9033-40 dated 07.11.2008 - Adjudicating Authority held that the unaccounted finished goods found in excess in the factory premises of M/s. Shanker valued at Rs.46,29,130/-are liable for confiscation under the provisions of Rule 25 of the Central Excise Rules, 2002.
The duties and penalties have been mainly imposed on the basis of the 3rd party records (mainly transporter‟s records) and the statements of the various persons being the staff of the transporters, the authorised persons of the 3 manufacturers, Mr. Alok Krishna Gupta (Dealer/Purchaser), Railway Booking Agent and his associates and some of the buyers/re-sellers of the goods, manufactured by the 3 appellant manufacturers.
HELD THAT:- It is the stand of the 3 appellant manufacturers that they have been selling their goods throughout ex factory, at ex factory price. It is the buyer, who after taking delivery, arranges for the transportation themselves. Under the admitted facts, the 3 appellant manufacturers are neither the consignor nor the consignee, in any of the third party transporter‟s records, including the Railways.
Almost all the persons, whose statements have been relied upon, have either retracted their statements, which were recorded during investigation and/or the veracity of their statements did not stand the test of cross examination during the adjudication proceedings. The ld. Commissioner has noted in para -50 of the impugned order, that all the respective persons have retracted from the revelation /acceptance made by them earlier in their statements tendered under Section 14 of the Act, mainly on one pretext or the other by claiming that - they were compelled to write their earlier statements under pressure by the Departmental Officers; or they had no alternative but to write the statements as dictated by the officers and put their signatures; or that they accepted their role in alleged clandestine removal solely under pressure/duress, put by the Departmental Officers and out of fear arising from the threat of being sent to jail; and most of them also stated that they did not file retraction before any Authority as they did not know what is retraction and what is the legal procedure for retracting from their statements.
The stand of the ld. Commissioner is bad and without authority of law, in view of the scope of inquiry or adjudication, particularly with respect to the reliability of the statements recorded during investigation, as clarified by the Hon‟ble Punjab & Haryana High Court in the case of Jindal Drugs [2016 (6) TMI 956 - PUNJAB & HARYANA HIGH COURT] and also by the Hon‟ble Supreme Court in the case of Vinod Solanki Vs. Union of India [2008 (12) TMI 31 - SUPREME COURT], wherein it is held that – a person accused of commission of an offence is not expected to prove to the hilt that confession had been obtained from him by any inducement, threat or promise by a person in authority.
Shri Dilip Gupta, (Railway Booking Agent), who, in his statement recorded during investigation, had stated that he was engaged in booking of goods of Sir Brand Gutka/Pan Masala as well as other brands from Kanpur Railway Station. He is the person, who stated the 4 point identification criteria of RRs relating to Sir Brand of Gutka/Pan Masala manufacturers. In his cross examination on 4.1.2017, he has retracted from his original statement stating that at the time of investigation, the statements were recorded under duress and coercion, he had to write as dictated to him by the officers. This fact is also evident from several contradictions in his statement recorded during investigation.
The charge of clandestine removal is a serious charge and altering the civil liability of the person, and as such, the duty liability and penalty cannot be fastened on the basis of the hearsay evidence, and assumptions and presumptions based on the same. The Xerox copy of the RRs supplied by the Railways are not reliable as per the provisions of Section 36 A of the Central Excise Act, as no presumption against the appellant manufacturer is available to the Revenue. We further observe that 3rd party evidence at best is a good ground for suspicion, but in absence of corroboration with the records, etc. of the appellant manufacturer(s), the demand of duty cannot be sustained - Similarly, the demand confirmed for alleged clandestine clearance through Bihar Carrying Co. Pvt. Ltd. and Trimurti Roadlines (based on third party documents and statements) are also held to be unsustainable and accordingly are set aside.
Proposed demand of duty of Rs.5.37 Crores (appox.) is concerned on the allegation of unaccounted receipt of packing materials from M/s Vinayak Ultraflex - HELD THAT:- The ld. Commissioner has observed that suspicion howsoever strong cannot be the proof of clandestine removal, in absence of corroborative evidence. It has been held in the impugned order that the basic allegation of receipt of unaccounted inputs by M/s. Vinayak Ultraflex does not stand, particularly in view of the report of the Central Forensic Laboratory, Hyderabad, and thus, there is no reliable data of alleged clandestine manufacture by M/s. Vinayak Ultraflex and its clearances to the appellant manufacturers. Accordingly, we uphold the findings of the Commissioner, and dismiss the grounds taken by the Revenue.
Demand of Rs.2,98,262/- on M/s. Seema Enterprises - HELD THAT:- It is only alleged on presumption that the goods seized with the transporter have actually been despatched by M/s. Seema Enterprises. Further, we find that M/s. Seema Enterprises have not claimed such goods lying in seizure with the transporters, and such goods have already been auction sold by the Revenue. Accordingly, we hold that charge of alleged clandestine removal under the facts and circumstances, is not established. Further, the order of confiscation is bad as the goods are not available or in existence. Accordingly, we set aside the demand of duty and penalty as well as fine.
Demand of Rs.1,60,377/- is concerned from M/s. Seema Enterprises as regards the goods seized in the premises of the two traders, and also the excess stock found in the factory premises of M/s. Seema - HELD THAT:- The finished goods lying inside the factory are not amenable to seizure, unless the same are found outside the factory or despatched. As per the provisions of the Act and the Rules thereunder, the excisable goods are liable to seizure only after such goods are cleared from the factory i.e. outside the factory premises, if found, have been removed without payment of duty. We also hold that there is no provisions for seizure and/ or confiscation of the raw materials lying inside the factory premises.
From the facts and circumstances emerging in the cross examination of the various key persons, whose statements have been relied upon, we are satisfied that in view of the facts emerging in the cross examination, the statements recorded during investigation are not reliable, being involuntary. It is, thus, established beyond any doubt that none of the oral statements obtained during investigation and relied upon documents (third party) can be given any credence or evidentiary value as the same have been found to be involuntary or tutored statements tendered under undue influence/duress/coercion exerted by the investigating officers. We also find that save and except the statements, there is absence of any substantial evidence to corroborate the third party evidences. Such oral evidences are not sufficient for confirmation of the charge of clandestine removal in absence of any corroboration, by way of some documentary evidence of the appellant - manufacturers.
As the demand(s) of duty and penalty have been set aside, against all the three manufacturers of “Sir Brand‟ Gutkha and Pan Masala, we set aside the penalties imposed on all the co-accused - Appeal allowed.
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2022 (1) TMI 1295
Acquittal of respondent accused under Sections 354, 504, 506 of the IPC, Section 3(1)(x) and 3(1)(xi) of the Scheduled Castes and the Scheduled Tribes (Prevention of Atrocities) Act, 1989 - evidences have not been appreciated properly - principles of natural justice - HELD THAT:- The High Court has only made general observations on the deposition of the witness examined. However, there is no reappreciation of the entire evidence in detail which exercise ought to have been made by the High Court while dealing with the judgment and order of acquittal. The High Court ought to have reappreciated the entire evidence on record as it was dealing with a first appeal. Being the first appellate court, the High Court was required to reappreciate the entire evidence on record and also the reasoning given by the learned Trial Court.
On perusal of the impugned judgment and order passed by the High Court, it is found that decision of the High Court is totally erroneous as it has ignored the settled legal position. The High Court has not at all discussed and/or reappreciated the entire evidence on record. In fact, the High Court has only made the general observations on the deposition of the witnesses examined. However, there is no reappreciation of entire evidence on record in detail, which ought to have been done by the High Court, being a first appellate court. Under the circumstances on the aforesaid ground alone, impugned judgment and order passed by the High Court deserves to be quashed and set aside and the same is to be remanded back to the High Court to decide the appeal afresh in accordance with law and on its own merits being mindful of the observations made.
The impugned judgment and order passed by the High Court is hereby quashed and set aside. The appeal before the High Court is ordered to be restored to its original file.
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