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Showing 161 to 180 of 1439 Records
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2015 (7) TMI 1285
CENVAT Credit - Capital goods - Whether the order of the learned Tribunal inasmuch as it gives effect to the notification No.16/09 prior to 7.7.2009 overlooking the fact that the same is made expressly effective only from the aforesaid date?
Held that:- The principles laid down in the case of Commissioner of Central Excise Jaipur V. Rajasthan Spinning & Weaving Mills Ltd. [2010 (7) TMI 12 - SUPREME COURT OF INDIA] applies to the present case, where it was held that Applying the "user test" on the facts in hand, we have no hesitation in holding that the steel plates and M.S. Channels, used in the fabrication of chimney would fall within the ambit of "capital goods" as contemplated in Rule 57Q.
Appeal allowed - decided in favor of appellant.
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2015 (7) TMI 1284
Reopening of assessment - assessee as accommodation entry beneficiary - Held that:- As decided in Signature Hotels P. Ltd. vs. Income Tax Officer [2011 (7) TMI 361 - DELHI HIGH COURT] case according to the information, the amount received from a company, was nothing but an accommodation entry and the assessee was the beneficiary. The reasons did not satisfy the requirements of Section 147 of the Act. There was no reference to any document or statement, except the annexure. The annexure could not be regarded as a material or evidence that prima facie showed or established nexus or link which disclosed escapement of income.
The annexure was not a pointer and did not indicate escapement of income. Further, the Assessing Officer did not apply his own mind to the information and examine the basis and material of the information. There was no dispute that the company, had a paid-up capital of ₹ 90 lakhs and was incorporated on January 4, 1989, and was also allotted a permanent account number in September, 2001. Thus, it could not be held to be a fictitious person. The reassessment proceedings were not valid and were lliable to be quashed. - Decided in favour of assessee
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2015 (7) TMI 1283
Addition u/s 40A - assessee has purchased land from the parties and made payments exceeding ₹ 20,000/- - Held that:- Business compulsion of the assessee that the assessee had to accept the insistence of the villagers as the assessee has purchased a large chunk of land and wanted to acquire the adjacent land in vicinity for launch of its project. It had to agree to some of the villagers in their demand of cash payments although the assessee was able to make major purchases by cheque. Moreover it is also on record that photos of sellers duly signed by them are recorded on the sale deed which was registered before the Sub Registrar. Thus reasonable cause for the assessee’s failure to make payment otherwise than by crossed cheques
Payees in this case also are illiterate villagers who wanted some of the payments to be done in cash. There is no dispute regarding identity of the payees and genuineness of the transaction. Moreover the above observations of the Tribunal in case of Saraswati Housing and Developers [2013 (12) TMI 1114 - ITAT DELHI] are squarely applicable on the facts of the case. - decided in favour of assessee.
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2015 (7) TMI 1282
TPA - DRP rejecting the entity level TNMM adopted by the TPO and directed to compute the adjustment at transaction level only Held that:- The undisputed fact is that the TP adjustments have to be made only for the transaction with the Associated Enterprises. A similar view was taken by the Tribunal in the case of Ratilal Becharlal & Sons [2012 (11) TMI 988 - ITAT MUMBAI ] wherein the Tribunal at para-13 of its order has held that “ adjustment arising out of ALP cannot be made on the entire turnover and the same has to be restricted to the International transaction with the AE.” Thus the ALP has to be at International Transaction and not in relation to assessee’s entire sales/turnover. - No error in the directions of the DRP. Appeal filed by the Revenue is accordingly dismissed.
Not allowing the benefit of the proviso to Sec. 92C - Held that:- A perusal of the assessment order shows that following the directions of the DRP, the AO has made TP adjustment of ₹ 3,16,022/-. We find force in the contention of the Ld. Counsel that the benefit of proviso i.e. the difference is within the range of +/ - 5% should be allowed to the assessee. We direct the AO to verify this contention of the assessee and decide the issue as per the provisions of the law.
Disallowance being loan written off - Held that:- Firstly the assessee lended money to MST knowing fully well that MST is not in a position to carry on the work of the assessee as it does not possess the necessary facilities. Yet the assessee advanced money to MST. The recovery of machinery from MST was nothing but recovery on account of adjustment of loan since the assessee has grossly failed to establish any commercial expediency in giving advance to MST, we do not find any reason to allow the write off as expenditure. We, therefore confirm the findings of the DRP.
Brought forward losses - Held that:- This issue has to be relooked as we have confirmed the findings of the DRP in so far as Transfer Pricing adjustments is concerned in Revenue’s appeal. The AO is directed to decide this issue afresh as per provisions of the law.
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2015 (7) TMI 1281
Reopening of the assessment u/s 147 - suppression of sales - Held that:- Entire sale transaction cannot be taken as income. By the impugned notice though the department has subjected GP at the rate of 26.10% on the suppressed sale transaction, now, the entire suppressed sale transaction is sought to be brought under the net of income tax, which is not permissible.
In view of this settled legal propositions, we are of the opinion that the respondent could not have issued impugned notice to the petitioner subject to suppressed sale transaction to income. In our opinion, impugned notice is inherently illegal and invalid and, therefore, it cannot be sustained for the aforesaid reasons - Decided in favour of assessee.
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2015 (7) TMI 1280
Deduction u/s 36(1)(viia) - whether deduction be calculated considering the loans and advances made during the year only by rural branches and not on the cumulative balances of loans and advances of the bank over the years? - Held that:- For the purpose of section 36(1)(viia), the aggregate average advances made by the rural branches of a scheduled bank shall be computed by taking the amounts of advances made by each rural branch as outstanding at the end of the last day of each month comprised in the previous year has to be aggregated separately.
CIT(A) instead of giving the direction to the AO to take the amount of advances as outstanding at the end of the last day of each month in the previous year di rec ted the Assessing Officer to take loans and advances made during the year only. We, therefore, set aside the order of CIT(Appeals) on this issue and amend the direction of the CIT(Appeals) and direct the Assessing Officer to compute 10% of the aggregate monthly average advances made by the rural branch of such Bank by taking the amount of advances by each rural branch as outstanding at the end of the last day of each month comprised in the previous year and aggregate the same separately as given under Rule 6ABA of the Income Tax Rules, 1962. - Decided in favour of assessee for statistical purposes.
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2015 (7) TMI 1279
Genuineness of the expenditure claimed - Held that:- We find that as per the agreement dated 04.05.2007 the assessee had to perform certain functions and for that purpose it had incurred expenditure. AO has not doubted the genuineness of the expenditure. The FAA has given a finding of fact that AO had made the disallowance merely on presumption.The DR was not able to controvert the assertion made by the FAA. The assessee had furnished the details of the expenditure. We are of the opinion that the order of the FAA does not require any interference from our side. So, confirming his order we decide ground no.1 against the AO.
Prior period expenditure - assessee follows mercantile system of accounting - Held that:- It is found that the assessee had not produced any documentary evidence in support of its claim,that during the appellate proceedings it furnished bill/vouchers and the FAA considering those documents granted relief to the assessee.But,as per the provisions of Rule 46A of the Income-tax Rules,1962 the FAA is required to forward the new evidences to the AO or has to admit the same under sub rule 4 of the Rules. We do find that the FAA has not followed any of the sub section of the Rule 46A and has decided the matter without calling for remand report from the AO. In the interest of justice,we are remitting back the matter to the file of the AO for limited purpose of verification of the bills/vouchers not produced before him and furnished to the FAA for the first time.- Decided partly in favour of revenue
TDS u/s 194J OR 194C - Disallowance being expenses on account of mixing supervision and packing supervision - TDS liability - Held that:- We find that the AO had made the disallowance as he was of the opinion that mixing supervision and packing supervision fell in the category of fees for technical services.He invoked the provisions of section 9(1)(vii)r.w.s.194J and 40(a)(ia). We find that he has not elaborated as to how the mixing and packing supervision can be termed fees for technical services-a term having its definite meaning.In our opinion,the FAA has rightly held that it was a pure and simple labour contract and was covered by the provisions of section 194C. - Decided against AO
TDS u/s 194C - Disallowance of loading and unloading expenses u/s.40(a)(ia) - Held that:- AO had made the disallowance as he was of the opinion that the loading and unloading charges were covered by the provisions of section 194C and that the assessee was liable to deduct tax for such payments.The assessee had made payments for loading and unloading to the unskilled daily labourers and there was no contract between the two parties.It had produced the necessary documents along with the vouchers before the AO. There was no justification in holding that the payments were covered by Section 194C of the Act and the assessee had to deduct tax at source. Therefore, in our opinion,the order of the FAA does not suffer from any legal or factual infirmity
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2015 (7) TMI 1278
The matter is set down for final hearing on 2nd September 2015. It is however, clarified that both the parties will have to address arguments on the question whether the interest paid on borrowings for the purposes of investment by the Assessee could be treated as business expenditure.
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2015 (7) TMI 1277
Disallowance u/s.14A by applying rule 8D - Held that:- No disallowance is to be made when there is no exempt income. No merit in the order of lower authorities for making disallowance u/s.14A r.w.r.8D, when there is no exempt income earned by the assessee.
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2015 (7) TMI 1276
Transfer pricing addition - comparable selection criteria - functional similarity - Held that:- The assessee is engaged in the business of developing and providing custom Ebusiness applications, thus companies functionally dissimilar with that of assessee need to be deselected from final list.
Computation of deduction u/s 10A - Held that:- Direction to reduce the expenses both from export turnover as well as total turnover for computation of deduction u/s 10A of the Act as relying on case of Tata Elxsi Ltd. [2011 (8) TMI 782 - KARNATAKA HIGH COURT ]
Disallowance of interest amount paid on delayed remittance of tax - assessee submitted that interest amount paid on delayed remittance of tax is compensatory in nature and is not penal in nature and therefore it is not disallowable u/s 37(1) - Held that:- We agree with the contention of the assessee that interest paid on delayed deposit of TDS amount into Government account cannot be held to be penal in nature. See case of CIT Vs. Mahalakshmi Sugar Mills(1980 (4) TMI 1 - SUPREME Court) - Thus we direct the AO to allow the said expenditure in the hands of the assessee.
TDS u/s 194C or 194I - Non-deduction of tax at source on rent paid towards service apartments - Held that:- These payments made are of ₹ 95,000/- each to three of the employees and not to the owner of the service apartments. Nothing has been brought on record by the AO that there is any contract between the assessee and the service apartment owner for rendering of any regular service during the relevant previous year. The services rendered by service apartments are similar to service rendered by Hotels and therefore clearly provisions of sec.194C are not applicable. Also even if it is exigible to tax as rent under section 194- I, the limit fixed for such application of the provision is ₹ 1,20,000/- for the relevant assessment year and therefore provisions of sec.194-I are also not applicable. - Decided in favour of assessee.
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2015 (7) TMI 1275
TPA - comparable selection criteria - Held that:- The assessee a domestic private limited company is engaged in the provision of software development services to its Associated Enterprises ('AEs'), thus companies functionally dissimilar with that of assessee need to be deselected from final list.
Computation of Deduction under Section 10A - Held that:- Taking into consideration the decision rendered by the Hon'ble High Court of Karnataka in the case of CIT v. Tata Elxsi Ltd. [2011 (8) TMI 782 - KARNATAKA HIGH COURT] we are of the view that it would be just and appropriate to direct the Assessing Officer that travel, interest charges - MPLS, etc incurred in foreign currency are to be excluded from both export turnover as well as total turnover while computing the deduction under Section 10A of the Act, as has been prayed by the assessee in its alternate plea at Ground raised at No.2.
Computation of deduction under Section 10A - Held that:- We find that the DRP had confirmed the Assessing Officer's finding on the ground that the assessee failed to adduce any evidence to support its claim. Considering the submissions made that the assessee was not afforded any opportunity of being heard in the matter and that the DRP dismissed its claim for lack of evidence being adduced, we deem it fit to remand the matter to the file of the Assessing Officer for de novo consideration of this issue and to decide thereon after affording the assessee adequate opportunity of being heard and to file details/evidence to support its claim in the matter.
Interest under Section 234B - Held that:- The assessee denied itself liable to be charged interest under Section 234B of the Act. The charging of interest is consequential and mandatory and the Assessing Officer has no discretion in the matter. This proposition has been upheld by the Hon'ble Apex Court in the case of CIT v. Anjum M.H. Ghaswala [2001 (10) TMI 4 - SUPREME Court] and we, therefore, uphold the action of the Assessing Officer in charging the said interest. The Assessing Officer is, however, directed to recompute the interest chargeable u/s. 234B and 234C of the Act, if any, while giving effect to this order.
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2015 (7) TMI 1274
Application for registration u/s 12AA rejected - Held that:- As in the present appeal is squarely covered in favour of the assessee inter alia by the decision of the coordinate bench of this Tribunal in the case of Rehoboth Mission V/s. Director of Income-tax(Exemption) (2010 (5) TMI 669 - ITAT HYDERABAD ), wherein it was held that there is nothing in the language of the relevant provisions of the Act to suggest that an institution with mixed objects is precluded from getting registration under S.12AA of the Act. It was held that a trust which is only for religious purposes is excluded and debarred from getting registration under S.12AA of the Act, and trust whose are charitable as well as religious cannot be denied registration under S.12AA. - Decided in favour of assessee.
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2015 (7) TMI 1273
Claim for deduction under Section 10A - suo moto adjustment made by the appellant under Section 92(1) - Held that:- Respectfully following the decision of the Hon'ble High Court of Karnataka in the case of iGate Global Solutions Ltd. (2007 (11) TMI 444 - ITAT BANGALORE) we hold that the assessee in the case on hand be allowed deduction claimed under Section 10A of the Act, in the return of income filed, in respect of Suo Moto T.P. Adjustment amounting to ₹ 28,61,352 while determining the Arm’s Length Price of its international transactions. - Decided in favour of assessee
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2015 (7) TMI 1272
Addition towards the provision of bad debts on standard assets - addition u/s.36(1)(viia) on the ground that the assessee failed to furnish the details of deduction during the assessment year - Held that:- Before us, the assessee submitted that the deduction was allowable to the assessee as the same was claimed in pursuance to the guidelines of the Reserve Bank of India. However, he did not furnish the details and evidence or any documents in support of the same. In absence of the same, we find no infirmity in the order of the Commissioner of Income Tax(Appeals), which is confirmed and the ground of appeal of the assessee is dismissed.
Addition u/s. 40(a)(ia) - disallowing the interest for not deducting TDS u/s. 194A(3)(v) - Held that:- In the light of the memorandum explaining the provisions in the Finance Bill 2015 and the clarification by the Board that the Circular has not been withdrawn, makes it ample clear that the impugned provisions relating to the liability of TDS would come with effect from 01/06/2015, we, therefore, set aside the findings of the Ld. CIT(A) and direct the Assessing Officer to delete the impugned additions made in the order u/s. 201(1) & 201(1A)- Decided in favour of assessee
Addition on account of accrued interest on loans which are classified as ‘Non-performing Assets’ - Held that:- In view of the decision of the jurisdictional High Court in the case of JCIT Vs.M/s Canfin Homes Ltd (2011 (8) TMI 178 - KARNATAKA HIGH COURT), it is observed that the facts of the appellant bank are similar to the facts of the case before the Hon'ble High Court of Karnataka wherein it has been held that the contention of the revenue that in respect of non-performing assets even though it does not yield any income as the assessee has adopted a mercantile system of accounting, he has to pay tax on the revenue which has accrued notionally is without any basis.- Decided in favour of assessee
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2015 (7) TMI 1271
Valuation - whether the clearances of cement made by the appellant in 50kg. bags to various builders and developers for the construction purpose are required to be held as entitled to exemption in terms of N/N. 4/2006-CE (Sl.No.1C)?
Held that: - the issue is no more res integra and stands settled in favour of the appellant by the Tribunal decision in the case of Mysore Cements Ltd. Vs. CCE, Bangalore-II [2009 (5) TMI 445 - CESTAT, BANGALORE], where it was held that the said clearances have been held to be covered by the expression industrial clearances and as such entitled to the benefit of the notification.
Appeal allowed - decided in favor of appellant.
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2015 (7) TMI 1270
Validity of proposition notice dated 14.8.2013 - Entertainment tax - notice was challenged on the ground that various material, on which the Department relied upon, were not provided along with the notice - Held that: - A plain reading of the assessment order goes to show that in the order it is acknowledged that the assessee had filed its objections 'which are gone through and found untenable'. Merely stating that the reply is untenable would not be sufficient. What was the reply to the show-cause notice and why the same was found to be untenable, has not been stated in the order.
The order of assessment dated 29.10.2013 passed by the Entertainment Tax Officer, IV Circle, Bangalore deserves to be quashed solely on the ground that it has not at all considered the objections filed by the appellant/assessee to the proposition notice dated 14.8.2013 - appeal allowed - decided in favor of appellant.
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2015 (7) TMI 1269
Offence under PMLA - confirmation of attachment of the properties - Held that:- The applicant has not produced any relevant documents to show that he had such dealings which would have generated money for him in his companies and businesses. The appellants has failed to discharge the burden which was on him under the Act. The applicant has alleged that he withdrew the money from the bank to purchase the land with another accused, however, it has not been shown even prima-facie as to from where the money had come in the businesses of the appellant. Except making bald allegations that the applicant had been doing businesses, the details of various transactions done by him was given by the appellant. In the circumstances, none of the allegations made by the appellant can be accepted.
Order of confirmation of attachment of the properties of the appellant are repelled and cannot be accepted. No illegality, irregularity has been made out in the impugned order which will entail interference by this Appellate Tribunal in exercising its appellate jurisdiction. No other pleas have been raised on behalf of the appellant except those which have been dealt with herein-above by this Tribunal.
Therefore the appeal of the appellant must fail. The appellant is not entitled for the reliefs claimed in the appeal. The provisional attachment order and impugned order confirming the attachment order cannot be set aside in the facts and circumstances.
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2015 (7) TMI 1268
Offence under PMLA - Furnishing of information to the Director - Held that:- During the course of hearing before this Tribunal, it was noticed that out of 2697 cash transactions, there are various transactions which are for ₹ 10,00,000/- and as per Rule 3, the appellant is not required to file report in respect of such transactions and the respondent has imposed fine on these transactions also. The appellant vide reply letter dated 2-8-2012 submitted that 256 transactions out of 2697 transaction could not be included as they were less than ₹ 10 lakhs. When this discrepancy was pointed out to the respondent, the respondent after verifications of facts from records submitted that out of 2697 transactions, 250 cash transactions are not reportable as each of them were of ₹ 10,00,000/- or less and therefore the amount of total fine can be reduced to this extent. It was submitted that correct number of failure after correction would be 2447 cash transactions and fine which could be imposed would work out to ₹ 2,44,70,000/-.
The appeal is therefore, without any merits and requires no further interference by this Tribunal except that the amount of fine is reduced to ₹ 2,44,70,000/-. The appeal is therefore, partly allowed. The application seeking stay of recovery of fine from the appellant is also dismissed and the stay order granted by this Tribunal is vacated. The appellant shall be entitled to pay the amount of fine of ₹ 2,44,70,000/- within four weeks, failing which the respondent shall be entitled to recover the amount from the appellant.
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2015 (7) TMI 1267
Powers to requisition books of account, etc u/s 132A - Valueable Articles and Currency Notes - whether once the requisition under section 132A of the Act is issued, the same requires to be denied on account of the objection raised by the prosecuting authority? - whether the cash of ₹ 8.10 crore would be necessary to be produced as muddamal of bribe or otherwise at the time of trial? - Held that:- It is nowhere coming on record that any trap was organised that the Court may require the detailed number of series of currency notes, which also in any case at the time of panchnama, the police ought to have done. Even if it is not done, it would not be difficult to so do it and the amount cannot continue to lie with the Investigating Officer. The Court in the alternative also could have thought of placing it in the Fixed Deposit or the bank locker with any Nationalised Bank for the purpose of safety and security of the currency notes. There is no purpose worth the name that would be served if the amount continues to lie with the Investigating Officer. This being a law on the interim custody during the pendency of the trial, the vital question that is addressed by this Court is the one raised by the applicant-Department being the claimant under the provision of law which has reason to believe that the amount is unaccounted money and is liable for investigation under the Incometax Act and Rules framed thereunder, the warrant of authorisation is issued and the same is found to be sustainable by this Court.
The learned trial Judge when observed that the seized amount pertained to bribe money and it was required to be preserved, it neither had regarded the provision of section 451 of the CrPC nor the law laid down on the subject, as discussed hereinabove, nor did it consider the relevant provisions of Incometax Act and the pronounced authorities on the subject while denying such requisition to the applicant-Department. The Investigating Agency was also not right in contending that the custody of this muddamal article is necessary till completion of the trial when even otherwise, the production of the same through panchnama or exhibiting the same by virtue of video recording of same could have been managed.
For the foregoing reasons, the present Revision Application succeeds and the same is, accordingly, allowed. The applicant-Department shall be free to undertake all actions permitted under the law, however, he shall make the Fixed Deposit of the entire amount of ₹ 8.10 crore with the State Bank of India within a period of four weeks from the date of taking over such muddamal currency notes, initially for a period of two years and thereafter, the same shall be renewed from time to time till finalisation of such proceedings initiated by the applicant-Department.
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2015 (7) TMI 1266
Refund claim - CENVAT credit - Welding Electrodes - Held that: - It is a settled position of law that the principle of res judicata is not applicable to the taxing statute. The appellant has complied with the requirements of Section 11B of the Central Excise Act, 1944 by filing the refund application - the appellant’s applications for refund cannot be denied and thus, the impugned order is set aside - appeal allowed - decided in favor of appellant.
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