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Showing 161 to 180 of 1389 Records
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2014 (7) TMI 1233
TPA - whether Tribunal is wrong in concluding that M/s.Vishal Information Technology Limited cannot be considered as a comparable case? - Held that:- M/s.Vishal Information Technologies cannot be considered as a comparable case as this company was rejected by coordinate Bench while deciding similar issue in the case of M/s.Brigade Global Services Pvt. Ltd [2014 (9) TMI 143 - ITAT HYDERABAD] as held the employee’s cost to total cost ratio is worked out at 2% as compared to the industry average of 30 to 40%. The assessee’s employee’s cost to total cost ratio is worked out at 47%. Since the employee’s cost form major cost base in ITES service industries, the low ratio of comparables implies that it would not be providing services by employing its own sources. Being so, the assessee is not alike to M/s.Vishal Information Technologies Ltd.Tribunal is not wrong in deciding the issue maintaining the rule of consistency.
Consider profit before depreciation and interest (PBDIT) as profit level indicator as directed by ITAT - Held that:- Tribunal on fact found that the depreciation has an impact on the profit margin. Based on the aforesaid findings, we feel that the impugned judgment and order of the learned Tribunal does not appear to be unjust and inappropriate.
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2014 (7) TMI 1232
Interest on delayed refund - whether the respondent is entitled to get the interest for the period of delay in late sanction of the refund amount? - Held that: - On a conjoint reading of Sections 11B and 11BB of the Act (discussed supra), it transpires that once an order is passed by the competent Central Excise authorities pursuant to the refund application filed by the applicant, then the refund shall be paid forthwith within a period of three months; and if claimed amount is not paid within such stipulated time frame, then under the statutory obligations, the authorities are required to pay interest on the refund amount paid belatedly.
The time limit for payment of the refund amount to the respondent by the Central Excise authorities (without interest) expired on 18-6-1998. Since, claimed amount was finally paid to the respondent on 22-8-2005, the respondent is entitled for the statutory interest from 19-6-1998 to the date when the refund was eventually paid, i.e., 22-8-2005
Appeal rejected - decided against Revenue.
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2014 (7) TMI 1231
Addition u/s 14A - Held that:- We find from section 14A(2) that in arriving at such a dissatisfaction over an assessee’s claim of not having incurred any expenditure relatable to its ‘exempt’ income in books of account, the concerned Assessing Officer has to take into account the said books and then only, he can resort to computation of such expenses under Rule 8D. In this case, the Assessing Officer has only drawn an inference that some indirect expenditure is always involved in supervision of such huge investments. And that too, without even specifically stating anything regarding the entries in the assessee’s books. In our view, this approach is nowhere a part of the relevant statutory provision in section 14A(2) of the Act. So, both the lower authorities have wrongly made the disallowance in question u/s 14A r.w. rule 8D. The same stands deleted. - Decided in favour of assessee
Disallowance to provision for insurance settlement - Held that:- Admitted factual position is that the assessee being a bulk drug manufacturer had exported its produce to a Dutch consignee. A part of this consignment has been rejected for quality reasons because the produce was kept in a ‘customs bonded house’ instead of immediate delivery resulting in deterioration of its quality. Before us, there is no cogent evidence produced to conclude that mere rejection of such a produce wholly or in part by whatsoever reasons gives rise to a compensation claim. The fact also remains that till date, the consignee entity is yet to raise its claim. The damages’ amount is yet to be ascertained. In these circumstances, we observe that the assessee has failed to prove the nature of liability claimed as an ascertained one. Therefore, we find no fault with the CIT(A)’s order affirming the impugned disallowance - Decided against assessee
TDS u/s 195 - Disallowance u/s 40(a)(i) - non deduction of TDS on export commission payments made to overseas agents - Held that:-no cogent material has been placed on record to prove rendering of any technical or managerial services u/s 9 of the Act or that the payments are taxable as income in India. The assessee’s overseas agents have procured export orders and rendered marketing services outside India and in lieu thereof payments have been made in foreign countries. hence no TDS liability arises to an assessee. See GE India Technology Centre Private Ltd. Versus Commissioner of Income Tax & Anr. [2010 (9) TMI 7 - SUPREME COURT OF INDIA ] .- Decided in favour of assessee
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2014 (7) TMI 1230
Condonation of delay - maintainability of appeal - Held that: - date of communication of the copy of the adjudication order will be construed as 2-2-2007 (communicated under the cover of the letter of Range Superintendent). Since the appeal has been filed on 2-4-2007, the same is not barred by limitation of time - matter on remand to the Commissioner (Appeals) for passing reasoned and speaking order - appeal allowed by way of remand.
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2014 (7) TMI 1229
CENVAT credit - steel racks - denial on the ground that the disputed goods, by nature of their use, neither qualify as inputs nor capital goods - Held that: - in view of the statutory definition of input and the requirement under the Prevention of Food Adulteration Act, 1954 regarding the manner of storing the raw material and finished product, it can be said that the disputed goods are very much essential to be considered as inputs, used in or in relation to manufacture of the final product.
Extended period of limitation - Held that: - the limitation should be confined to a period of one year because there is no suppression or misstatement involved.
Appeal allowed - decided in favor of appellant.
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2014 (7) TMI 1228
Import of stone chips from Bangladesh - whether the stone chips are exigible to tax under the TVAT Act? - Whether the petitioner is a dealer and liable to file returns in respect of the import of stone chips from Bangladesh? - Held that: - Section 5 of the TVAT Act which deals with levy of tax on sale the legislature was conscious of the fact that it had no authority to levy tax on inter-State sales or import or export of goods within or outside the territory of India and therefore, incorporated Section 5(2)(b) - This clearly shows that sales of goods which take place in the course of the import of the goods into or export of the goods out of the territory of India are not sales within the meaning of the TVAT Act. If they are not sales then no notice or assessment can be made in regard thereto - sales which takes place during the import of goods into the territory of India are not exigible to tax under the TVAT Act.
Assessment orders quashed - it is for the Department to find out what the petitioner did with the goods and take further action - petition allowed - decided in favor of petitioner.
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2014 (7) TMI 1227
Model Know How Fee - disallowance by AO as capital expenditure and covered under Section 35AB - Held that:- This issue has been decided against the revenue and in favour of the respondent- assessee, in the earlier years by the Delhi High Court. Special Leave Petition filed before the Supreme Court was dismissed. The aforesaid factual position stated by the Tribunal in the impugned order on the aforesaid question is accepted as correct by the Standing Counsel for the Revenue.
Provision of warranty - why and for what reason the claim for warrantee can be categorized as exaggerated or untenable in terms of the observations in Rotork Controls India Limited (2009 (5) TMI 16 - SUPREME COURT OF INDIA) - Held that:- The only reason given by the learned Standing Counsel is that in the present case, the data relied upon by the assessee pertains to two years; whereas, in Rotork Controls India Limited (supra) only one year data was considered. The argument fail to notice in that in this case, the warrantee was for two years. Even otherwise, this reason does not appeal to us. Data and figures should truly and correctly reflect and support the claim for provision for warranty. It should not be excessive. The aforesaid decision of the Supreme Court provides for and stipulates adjustment, in case an excessive or higher claim is made by an assessee. It is not the case of the Revenue that in fact, it was found that any excessive or wrong claim was made. Figures for warranty claims actually made would be available with the Revenue but were not pointed out to the Tribunal or before us.
Expenditure incurred on purchasing software - should been treated as capital expense or revenue expenditure - Held that:- The aforesaid expenditure was for purchase of application software and not on customerized or operating software. Tribunal in the impugned judgment has followed decision of the Delhi High Court in CIT Vs. Asahi India Safety Glass, (2011 (11) TMI 2 - DELHI HIGH COURT ). It is not shown to us that the software in question had enduring benefit and why and for what reason, the software purchased should be treated as a capital asset. The third issue therefore does not require consideration of this Court as a substantial question of law.
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2014 (7) TMI 1226
The following substantial questions of law are framed:
1.Whether the Income Tax Appellate Tribunal was right in dis- allowing the claim under Section 80IA of the Income Tax Act, 1961 for violation of sub section (8).
2. Whether the Income Tax Appellate Tribunal was right in holding that the Transactional Net Marginal Method should not be applied and Comparable Uncontrolled Price Method was the most appropriate method to compute ancillary price for purchase of spare parts and components from the related party.
Filing of the printed paper book is dispensed with. However, parties are given liberty to file documents/papers in terms of the High Court Rules.
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2014 (7) TMI 1225
Trade tax - tractor batteries - Section 3-A of the Tax Act - Entry No.46 of the N/N. dated 15.1.2000 - Entry No.18 of N/N. dated 29.1.2001 - Entry No.18(i) as modified by N/N. dated 19.5.2003 - Based on Entry No.18 of the N/N. dated 9.5.2003, a circular dated 22.5.2007 was issued by the Commissioner of Trade Tax indicating that in view of the inclusion of “battery” in the N/N. dated 9.5.2003 and non-inclusion of battery in the N/N. dated 15.1.2000, the tractor battery should be subjected to tax as an unclassified item @ 10% - whether the batteries are to be considered as parts or accessories of tractor and at what rate should it be taxed?
Held that: - a battery, which is fitted in a tractor, is an integral part of a tractor if not an accessory. Assuming that battery is supplementary or subordinate in nature and is not essential for actual functioning of the product, even then, battery would be included as a part, if not, accessory of a tractor under the notification dated 15.1.2000 in view of the words “of all kinds”. The said words are of wide import and would include battery tractor - We are of the opinion that a battery is an essential component for the functioning of the tractor and is an integral part of the tractor. Consequently, a battery would be covered under the notification dated 15.1.2000.
Jurisdiction of AO - reasons to believe to impose tax - The words “has reasons to believe” must not be arbitrary or irrational but must be based on reasons which are relevant and germane to the issue. The formation of the required opinion and belief by the assessing officer is a condition precedent. Without such formation, the assessing officer will have no jurisdiction to initiate proceedings under Section 21 of the Act Held that: - the assessing officer as well as the Additional Commissioner, while granting permission, was of a belief that tractor battery is liable to be taxed as an unclassified item @ 10%. Such belief was based on comparison of the notification dated 9.5.2003 wherein batteries were included as a component, parts and accessories of a vehicle, which excluded tractor and consequently had a reasonable belief and formed an opinion that non-exclusion of battery in the notification dated 15.1.2000, which related to parts and accessories and attachments of tractor would mean that tractor battery cannot be included in the notification dated 15.1.2000 and, therefore, has to be treated as an unclassified item. Further, the belief was formed also on the basis of the circular dated 22.5.2007 issued by the Commissioner, which is binding upon the subordinate authorities. The Court is of the opinion, that such belief forming an opinion that whole or any part of the turnover of a dealer had escaped assessment of tax is not based on any rational basis nor the belief is germane to the issued involved nor such reasons have a nexus with the issue involved.
Initiation of re-assessment proceedings under Section 21 of the Act was wholly illegal and without any authority of law. Consequently, the impugned order of the Additional Commissioner of Trade Tax, dated 20.5.2008, granting permission to the assessing authority for reopening the assessment proceedings under Section 21 of the Act as well as notice under Section 21 of the Act, dated 26.3.2008, issued by the Trade Tax Officer and the circular dated 22.5.2007 issued by the Commissioner of Trade Tax are wholly illegal and are quashed.
Petition allowed - decided in favor of petitioner.
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2014 (7) TMI 1224
Deemed divided u/s 2(22) - Held that:- The company in question not a Private Limited Company which is alone is attracted to the provisions of section 2(22)(e) of the Act. The said company is a Public company in which public are substantially interested. Considering the above distinction, the CIT (A) correctly granted relief to the assessee - Decided in favour of assessee
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2014 (7) TMI 1223
Judicial custody - bail application - whether the petitioner can be said to be in the unlawful custody? - Held that:- Narration of facts that the petitioner is in judicial custody by virtue of an order passed by the Judicial Magistrate. The same is further ensured from the Original Record which this Court has, by order dated 9th April, 2014, called for from the Court of Additional Chief Judicial Magistrate, Dalsingsarai, District Samastipur, Bihar. Hence, the contention of the learned counsel for the petitioner that there was illegal detention without any case is incorrect. Therefore, the relief sought for by the petitioner cannot be granted. Even though there are several other issues raised in the Writ Petition, in view of the facts narrated above, there is no need for us to go into those issues. However, the petitioner is at liberty to make an application for his release in Criminal Case No. 129/13 pending before the Court of the learned Addl. Chief Judicial Magistrate, Dalsingsarai.
After the conclusion of hearing, when the matter was reserved for judgment and the pronouncement of judgment is pending, a Crl.M.P. No. 12866 of 2014 has been filed by the writ petitioner seeking reliefs which are not concerned with the main prayer. The petitioner has also filed another Crl.M.P. No. 14378 of 2014 seeking release of petitioner’s mother and grand father. In view of the foregoing discussion and the reasons given in the judgment, the reliefs so sought by the petitioner in the said Crl.M.Ps. also cannot be granted in the present habeas corpus writ petition. However, the petitioner is at liberty to avail remedies as available to him in accordance with law.
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2014 (7) TMI 1222
Addition on gift received - Held that:- Four of the donors appeared before the Assessing Officer in the remand proceedings and confirmed that they had given the gifts and some of the gifts were by cheque. Further a perusal of the assessment order as also that of the ld. CIT(Appeals) shows that the donors are all income-tax assessees and they have all filed their returns and have accepted giving gifts to the assessee. Admittedly the assessee has proved the identity of the donors as has been accepted by the Assessing Officer in his assessment order. The Assessing Officer is only doubting the creditworthiness of the donors and the genuineness of the gifts. The donors themselves having confirmed that they have given the gifts and having shown that they are income-tax assessees and having filed their returns of income clearly show their creditworthy. Thus we are of the view that the addition as made by the Assessing Officer and confirmed by the ld. CIT(Appeals) representing the gifts received by the assessee is liable to be deleted and we do so. - Decided in favour of assessee
Addition on low drawings - Held that:- As noticed that the assessee is 71 years old person. He is staying with his son. No expenditure has been found in the hands of the assessee, which has remained unexplained. This being so, no ad hoc disallowance under the head “drawings” can be made in the hands of the assessee. In these circumstances, the addition as made by the Assessing Officer and as reduced by the ld. CIT(Appeals) on account of drawings stands deleted.- Decided in favour of assessee
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2014 (7) TMI 1221
Validity of summons issued - production of the documents - Held that:- It is seen that the criminal case was registered pursuant to a complaint giving by one Mr. Mahesh who was the intervenor in the anticipatory bail application filed by the petitioners and the said proceedings are independent proceedings wherein the offences alleged are under the provisions of I.P.C which are said to have been committed by the petitioners.Therefore, the petitioners have to defend themselves in that proceedings independently
So far, the documents (b) and (c) mentioned in the summons they are pertaining to bank details with the transcripts of the petitioners and the family members and their Companies and other relate to the immovable properties held by the petitioners in India and by their family members, Companies namely viz., M/s. Chivas Trading Corporation.
Thus all the documents called for clearly fall within the ambit of sub-sections (a) to (e) of Section 12(1) of the Act. In such circumstances the summons issued to the petitioners cannot be quashed at the very threshold. In any event, the summons is for production of the documents for the purpose of conducting an investigation under the Act. The petitioners apprehend harassment in the hands of the respondent/designated authority when they are appear for enquiry pursuant to the summons.
While rejecting the prayer sought for by the petitioners, there will be a direction to the petitioners to appear before the respondent on 18.07.2014 and produce the documents sought for and the respondent/designated authority shall investigate the matter strictly in accordance with law under the provisions of the Act, without giving any room for any complaint.
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2014 (7) TMI 1220
Taxation of undisclosed income - taxation in the hands of HUF - Held that- Once a person files an application under Section 64 in accordance with the provisions of Section 65 in respect of any income chargeable to tax under the Act, which earlier he has not offered it to tax, the Commissioner on consideration of such application can grant a certificate to him setting forth the particulars of voluntary disclosed of income and the amount of income tax paid in respect of the same. Once such a certificate is granted, the amount of the voluntary disclosed income shall not be included in the total income of the declarant for any assessment year under the income tax Act. Once a particular income is included in the income of the person and taxed and such person pays the tax, the same income.
Cannot be taxed in the hands of another person. In the instant case the amount has been taxed in the hands of HUF. Once the tax is paid for that undisclosed income, again the same income cannot be taxed in the hands of the member of the HUF, that is the assessee.
Therefore, in the light of the provisions of VDIS scheme as well as the provisions of the Act, the Appellate Authorities were justified in holding that as long as the certificate is in force, the income which was the subject matter of the certificate cannot be taxed not only in the hands of the declarant but also in the hands of any other person. If such a certificate is obtained by misrepresentation misleading the Commissioner, the proper course would be to recall the said certificate. No such steps are taken. The certificate is still in force. When that being the case, the same income cannot be assessed over and a gain in the hands of the individuals who are the members of the HUF.
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2014 (7) TMI 1219
Income of assessee trust - Assessee indulging in the business carried on by the beneficiary unit - heavy expenditure incurred in connection with setting up of various functional units - Held that:- As rightly held by the Commissioner of Income-tax(Appeals), the entire income was earned by the assessee by way of interest and other incidental charges. Those interest income did not arise to the assessee trust, as a partner of the subsidiary units or as an investor in the subsidiary units. It is neither a partner nor an investor with reference to the newly set up micro units. It is already mentioned above that it is a provider, a facilitator and an organizer.
Therefore, the heavy expenditure incurred in connection with setting up of various functional units cannot be claimed as expenditure of the assessee trust. Those expenses could be, perhaps, if law permits, claimed as deductions in the hands of those respective units. In view of the matter, we agree with the Commissioner of Income-tax(Appeals) that various items of expenditure incurred by the assessee and claimed as deductions are in fact not allowable. We also agree with the Commissioner of Income-tax(Appeals) that the income of the assessee has to be necessarily assessed under the head “income from other sources”. At the maximum, the assessee may be characterized as a “private charity”. It is not possible to hold that the assessee is carrying on any business and the income reported by the assessee is income from business.
As it is necessary for every institution to incur expenditure for its sustenance and operation. For that purpose, the Commissioner of Income-tax(Appeals) has allowed an over-all deduction of expenditure at 2% of the gross collection of income reported by the assessee trust. We find that the said amount of expenditure is reasonable. Accordingly, we uphold the order of the Commissioner of Income-tax(Appeals). - Decided against assessee.
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2014 (7) TMI 1218
Penalty imposed u/s 271(1)(C) - undisclosed income in response to the notice issued u/s 153A - Held that:- CIT(A) was not justified in upholding the penalty levied by the AO in the present case wherein returned undisclosed income in response to the notice issued u/s 153A was accepted by the AO in the assessment framed u/s 153A / 143(3) of the Act. We thus while setting aside orders of the authorities below direct the AO to delete the penalty in question levied in the years in appeals. The ground is accordingly allowed in favour of the assessee.
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2014 (7) TMI 1216
Depreciation on 'vehicles given on finance lease’ - Held that:- The assessments in the instant case are accordingly directed to be completed by the A.O., i.e., qua the issue of sale and lease back of the assets under reference, in light of and following the decision by the apex court in the case of ICDS Ltd. (2013 (1) TMI 344 - SUPREME COURT) which represents the law of the land stating assessee entitled to claim depreciation in respect of additions made to assets which were leased out. Further, the A.O. shall also, make the consequential adjustments, so that, while allowing due relief, double benefit is not extended to the assessee, even as cautioned by the tribunal in its own case for the earlier years, cited supra.
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2014 (7) TMI 1215
Condonation of delay - waiver of pre-deposit of penalty of ₹ 1.75 crores imposed under Section 112 (a) of the Customs Act, 1962 - waiver of pre-deposit of interest and penalty of ₹ 5,11,47,282/- imposed under Section 114A of the Customs Act - mis-declaration of value of Barge - demand of differential duty confirmed - Held that: - the value of the imported goods i.e. barge is found to be misdeclared, the applicants have not made out a case for waiver of pre-deposit of penalty - pre-deposit of the remaining dues are waived and recovery thereof stayed for hearing the appeals - application disposed off - delay condoned - waiver allowed partly.
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2014 (7) TMI 1214
Nature of land - whether land in question had fallen within the definition of “asset” as per Section 2(ea) of WT Act - Held that:- After formulating the correct legal position that the agricultural land if within municipal limits and if established the nature of the land as agricultural land; then should not be held as “urban land”, we hereby consider it necessary to direct the assessee to establish the nature / the character of the agricultural land. As noted above, the assessee has furnished 7/12 extract of the land. We are of the considered opinion that mere filing of 7/12 extract is not sufficient.
The provision prescribes that the land is to be used for agriculture purposes. Due to this reason, the assessee has to establish the agricultural operation whether carried out or not and that agriculture income was shown in the income tax return. Agriculture activity coupled with 7/12 extract can establish the nature of the land. When the proceedings were carried out before the lower authorities the provisions of WT Act were only considered by them and it was opined that the claim of the assessee was not within the ambits of the relevant provisions of WT Act; hence, the merits of the nature of the land were not examined. It was rightly so; because as per old law land of any nature if situated within the municipal limit was to be treated as “urban land”; then there was no need of further enquiry about the value of the land at that point of time. We, therefore, now deem it proper to restore this issue back to the file of AO to examine the merits of the claim on the basis of the evidence. Side by side, we hereby direct these appellants to furnish all the relevant evidences so that a correct view can be expressed by the learned AO. Since, the issue has been restored back; therefore, the grounds may be treated as allowed but for statistical purpose only.
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2014 (7) TMI 1213
Demand by applying the ratio of law declared by the Larger Bench of this Tribunal in the case of Vandana Global Ltd. [2010 (4) TMI 133 - CESTAT, NEW DELHI (LB)] - period involved is October 2004 to March, 2007 - Held that:- the Tribunal in an identical matter has taken a view that inasmuch as the issue prior to Vandana Global was decided in favour of the assessee, no suppression can be attributed to them. Therefore, by following the same and other various case laws, the impugned order is set aside. - Decided in favour of appellant with consequential relef
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