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Showing 161 to 180 of 1254 Records
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2014 (8) TMI 1095
Principles of natural justice - personal hearing was given in relation to a show cause notice dated 16th November, 2010. That show cause notice was different from the subject matter of the application being considered by the Commissioner, which was for remission of excise duty - Held that: - the purpose of the rules of natural justice is to afford an opportunity to a party to present his case. A case may be presented by written or oral representation or by both together with examination of witnesses etc. The extent of this field has never been closed by the Court and it varies from case to case and from circumstance to circumstance. I am satisfied that the writ petitioners were able to present their case before the Commissioner.
If the writ petitioners are aggrieved by the order of the Commissioner, in my opinion, the proper remedy before them is before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) under Section 35B, as it is the alternative remedy and the Writ Court, normally, is not a fact finding Court.
Application disposed off.
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2014 (8) TMI 1094
Compounding of offences - Section 132 and Section 135(1)(a) of the Customs Act - The ACMM was of the view that although a specific prayer had been made by the Department before the Apex Court seeking a direction for reopening of the case but the same had not been permitted and the ACMM not being in a position to recall its order, the said application was dismissed - Held that: - a second complaint on the same facts is also not barred where the first complaint has been dismissed without assigning any reason and in such an eventuality, a second complaint can be proceeded with if there is sufficient ground made out in the said complaint.
Since the whole foundation of the order on the strength of which the order dated 15-1-2007 was passed has been set aside by the Supreme Court i.e. (order of the Compounding Authority dated 25-5-2006 and order of the High Court dated 17-10-2006) by its subsequent order dated 25-1-2008, the order dated 15-1-2007 cannot be sustained. The order dated 20-2-2010 is also wholly illegal.
Petition disposed off.
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2014 (8) TMI 1093
Penalty u/s.271(1)(c) - dividend striping u/s. 94(7) - assessee is a share broker and a share trader - concealment of income v/s bona fide mistake - Held that:- CIT(A) after going through the explanation submitted by the assessee has observed that it was not a case of concealment of income rather of bona fide mistake. The A.O. had not detected any concealment of income but had sought the details of disallowance u/s. 94(7) in ordinary course of assessment proceedings. The ld. CIT(A), therefore held that it was not a fit case for levy of penalty.
AR submitted that the assessee has returned a total income of ₹ 12.25 crores. He, further, submitted that the disallowance prescribed u/s.94(7) is a statutory disallowance only. Accordingly, he submitted that there is no concealment of particulars of income on furnishing of inaccurate particulars of income. We find force in the submissions of the ld. AR.
There is no infirmity in the order of the ld. CIT(A). - Decided against revenue
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2014 (8) TMI 1092
Non granting relief of liability towards interest expenditure claimed by the assessee - Held that:- We find that identical issue has been set-aside and restored to the files of the CIT(A) for afresh adjudication of the issue after granting a reasonable opportunity of being heard to the assessee. This view has been taken by the Tribunal in the case of M/s Eminent Holdings Pvt. Ltd. [2014 (7) TMI 2 - ITAT MUMBAI] wherein the Tribunal has followed the decision of the Co-ordinate Bench in the case of Hitesh S. Mehta [2013 (10) TMI 1065- ITAT MUMBAI]. Respectfully following the aforesaid order of the Tribunal, we are of the considered opinion that the issue raised in ground no.4 should set-aside to the files of the CIT(A) for afresh adjudication of the issue after granting a reasonable opportunity of being heard to the issue. Ground no.4 is allowed for statistical purposes.
Calculation of book profit u/s 115JB - Held that:- Since we have set-aside ground no. 4, this grievance is consequential to the outcome of the decision taken in respect of ground no.4. We accordingly set-aside this grievance to the files of the CIT(A) to decide afresh as per the provisions of the law after giving findings on the claim of interest as per ground no. 4 of this appeal. Ground no. 5 is allowed for statistical purposes.
Chargeability of interest u/s 234A, 234B and 234C - Held that:- Levy of interest is mandatory though consequential on the facts of the case, we accordingly set-aside this issue to the files of the CIT(A) to levy interest as per the provisions of the law.
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2014 (8) TMI 1091
Invoking provisions of Section 40A(2)(b)(ii) - payment made to Renu Munjal, Director the assessee company - AO had invoked Section 36(1)(ii) of the Act on the ground that Renu Munjal was also a shareholder and therefore, the commission payment should be disallowed as dividend could have been paid - Held that:- Reasoning of the Assessing Officer has been rightly rejected by the Tribunal. It is also noticeable that tax on dividend payment payable by the respondent company was much less than the tax payable by the individual assessee on income under the head ‘Salary’. In case, Renu Munjal had received dividend, she would not have paid any tax on dividend. However, she has paid tax on the commission earned. In these circumstances, we are not inclined to interfere with the impugned order.
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2014 (8) TMI 1090
Disallowance u/s 14A - administrative expenses which has been made after taking 0.5% of the average investment value, as envisaged in rule 8D - Held that:- No effort was made or any time was consumed for making any analysis of the investment which has resulted into exempt income of ₹ 26,310, by way of dividend. The assessee has already disallowed the sum of ₹ 1,200 on account of demat charges which is sufficient and directly attributable to the exempt income. Under these facts and circumstances, we are of the opinion that simply relying on rule 8D, for the purpose of disallowance, cannot be held to be applicable, because the Assessing Officer having regard to the accounts of the assessee as well as the nature of expenses incurred which can be said to be attributable for the earning of exempt income, has not pointed out what are the expenses which could be said to be have been incurred or attributable on the administrative expenses.
Only when the Assessing Officer is not satisfied with the correctness of the claim of the assessee, he can proceed to apply rule 8D. In this case, such a requirement has not been fulfilled by the Assessing Officer. Accordingly, we do not find any merit in the disallowance made by the Assessing Officer under rule 8D and accordingly, the disallowance made by the Assessing Officer under rule 8D and confirmed by the learned Commissioner (Appeals) stands deleted. - Decided in favour of assessee
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2014 (8) TMI 1089
Permission to take the vessel out of India for dry docking at Colombo for 60 days - Held that: - the issue of classification is pending in the Tribunal - the differential duty amount of ₹ 6.52 crores already paid and the applicant had also executed a bank guarantee for ₹ 8.20 crores which is still alive, we direct the applicant to execute a bank guarantee of another ₹ 3.00 crores in favour of the Commissioner of Customs (Import), New Customs House, Mumbai, to safe guard the interest of revenue. On such execution of bank guarantee of ₹ 3.00 crores, the learned Commissioner of Customs (Import), Mumbai shall allow the applicant to take the vessel outside India for dry docking for 60 days from the date of export - permission granted subject to condition.
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2014 (8) TMI 1088
Validity of reopening of assessment - Held that:- AO was not justified in initiating the instant reassessment proceedings based on the information received from the Director of Income-tax (Inv.), New Delhi. No individual application of mind by A0 - Decided in favour of assessee
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2014 (8) TMI 1087
Validity of the order passed u/s 263 - capital gain computation - income was divided between both the assessees as per the provisions of Sec. 5A of the Income Tax Act - Held that:- We have gone through the provisions of section 2(47). This section defines the term transfer for the purpose of charging the capital gain. Section 45 mandates that the capital gain is chargeable to tax in the year in which the capital asset is transferred. The assessing officer in our opinion was bound to inquire into the transaction which the assessee has entered into with M/s Emgee Housing Pvt Ltd on the basis of the seized material A/EB/21 dated 25.2.10.The AO, in this case, we noted, except asking for the note on the transaction with details, assessee entered into with M/s Emgee Housing P Ltd did not examine whether the provision of section 2(47) are applicable on these transaction or not during the year. Not only this, this an disputed fact that the assessee did not file any note or details on the transactions entered into by the assessee with M/s Emgee Housing P Ltd, even though the said information was duly asked for by the assessing officer, yet the assessing officer passed the assessment ignoring whether any income arises during the year. It is not a case where the AO has allowed the deduction by taking one of the possible views. It is also not a case of inadequate inquiry but a case where no inquiry has been conducted by the AO on the applicability of section 2(47) of the Income Tax Act for the gain arising on the transaction which the assessee had with M/s Emgee Housing P Ltd.
Lack of enquiry will tantamount to be that the order is erroneous and prejudicial to the interest of Revenue. Our aforesaid view is duly supported by the decision of Full Bench of Guwahati High Court in the case of CIT vs Jawahar Bhattacharjee, (2012 (4) TMI 222 - GAUHATI HIGH COURT ) in which Hon‟ble High Court took the view “ Not holding such inquiry as a normal and not applying the mind to the relevant material in making an assessment would be an erroneous assessment warranting exercise of revisional jurisdiction.” The CIT has already restored this issue to the file of the Assessing Officer and the Assessing Officer, after giving proper opportunity to the assessee has to re-decide the issue whether any capital gain arise during the year. We therefore, cannot entertain the ground relating to the merit of the issue as CIT(A) has not decided the issue on merit.
We, therefore, do not find any illegality or infirmity in the order of CIT invoking the jurisdiction u/s 263 of the Income Tax Act in all the cases. - Decided against assessee
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2014 (8) TMI 1086
Deduction under section 80P(2)(a)(i) - whether assessee being a regional rural bank established under RRB Act, 1976, was to be treated as a co-operative bank or could be considered as a co-operative society? - Held that:- This issue has been decided in favour of the assessee in its own case for the earlier assessment years by the co-ordinate Bench of this Tribunal [2012 (8) TMI 1059 - ITAT CHENNAI] held that there is much strength in the argument of the assessee that it is to be treated as cooperative society in view of the provisions contained in RRB Act, 1976. If so, it would be eligible under section 80P(2)(a)(i) of the Act - Decided in favour of assessee
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2014 (8) TMI 1085
Disallowance of expenditure on repairs and maintenance of building, plant and machinery - Held that:- As observed that the Tribunal in the assessee’s own case for the A.Y. 2008-09, has decided a similar expenditure on account of renovation of godown floor as revenue in nature. Following the said order, we are of the considered opinion that the expenditure on account of replacement and maintenance on building has to be treated as revenue expenditure and the assessee is entitled for the claim of deduction.
As regards the other expenditure claimed by the assessee on account of repairs and maintenance to plant and machinery, after considering the nature of the expenditure incurred by the assessee as aforementioned in the table, we are of the considered view that the said expenditure do not result in any enduring benefit to the assessee as the expenses are periodically necessary for running the business of the asseseee. Therefore, the authorities below are not justified in treating the same to be capital in nature. - Decided in favour of assessee
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2014 (8) TMI 1084
Workmen engaged in statutory canteens through a contractor - nature of control - whether workers, engaged on a casual or temporary basis by a contractor (HCI) to operate and run a statutory canteen, under the provisions of the Act, 1948, on the premises of a factory – Air India, can be said to be the workmen of the said factory or corporation?- liability of the principal employer running statutory canteens - status of the workmen engaged
Held that:- The mere fact that the Air India has a certain degree of control over the HCI, does not mean that the employees working in the canteen are the Air India’s employees. The Air India exercises control that is in the nature of supervision. Being the primary shareholder in the HCI and shouldering certain financial burdens such as providing with the subsidies as required by law, the Air India would be entitled to have an opinion or a say in ensuring effective utilization of resources, monetary or otherwise. The said supervision or control would appear to be merely to ensure due maintenance of standards and quality in the said canteen.
The appellants-workmen could not be said to be under the effective and absolute control of Air India. The Air India merely has control of supervision over the working of the given statutory canteen. Issues regarding appointment of the said workmen, their dismissal, payment of their salaries, etc. are within the control of the HCI. It cannot be then said that the appellants are the workmen of Air India and therefore are entitled to regularization of their services.
It would be pertinent to mention, at this stage, that there is no parity in the nature of work, mode of appointment, experience, qualifications, etc., between the regular employees of the Air India and the workers of the given canteen. Therefore, the appellants-workmen cannot be placed at the same footing as the Air India’s regular employees, and thereby claim the same benefits as bestowed upon the latter. It would also be gainsaid to note the fact that the appellants-herein made no claim or prayer against either of the other respondents, that is, the HCI or the Chefair.
Thus the workers engaged by a contractor to work in the statutory canteen of a factory would be the workers of the said factory, but only for the purposes of the Act, 1948, and not for other purposes, and further for the said workers, to be called the employees of the factory for all purposes, they would need to satisfy the test of employer-employee relationship and it must be shown that the employer exercises absolute and effective control over the said workers.
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2014 (8) TMI 1083
Addition as per disclosure made by the assessee - Held that:- We find that there is no basis for making this disclosure and thereafter addition made by AO to the returned income of the assessee as there is no corroborative or direct evidence which shows that the assessee has earned this amount of ₹ 1 cr. There is no deposit in the bank account and there is no cash or incriminating papers found during the course of search on the premises of the assessee or there is no unaccounted deposits found in the above-stated two bank accounts relating to which this income is to be declared. But the AO added the sum of ₹ 1 cr. to the returned income of the assessee on the basis of disclosure letter dated 06.05.210 filed before DDIT, Investigation, Unit 1(4), Kolkata. As there is no basis for making this addition, CIT(A) has rightly deleted the addition based on the submissions and relying on various authorities. We confirm the order of CIT(A).
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2014 (8) TMI 1082
Valuation of property - property jointly owned - retrospective effect of section 142A - Held that:- It was not disputed by learned counsel for the revenue that the husband of the assessee, Shri Paramjit Singh also had 25% share in the said property and in his case, the Tribunal had adjudicated the issue in his favour and accepted the valuation shown by him and the order of the Tribunal was accepted by the revenue as no further appeal was filed against it. In such circumstances, it would not be appropriate to adopt two different valuations in respect of identical shares in the same property for the same period.
A Division Bench of this Court in Jaswant Rai's case [1977 (2) TMI 22 - PUNJAB AND HARYANA HIGH COURT] noticed that where the property was jointly owned, the valuation in the case of one co-sharer should be followed in the case of other co-sharer unless different circumstances are demonstrated. Further, the Apex Court in Berger Paints India Limited's case [2004 (2) TMI 4 - SUPREME COURT] while adjudicating identical issue held if the revenue has not challenged the correctness of the law laid For Subsequent orders down by the High Court and has accepted it in the case of one assessee, then it is not open to the revenue to challenge its correctness in the case of other assessees, without just cause. - Decided against revenue
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2014 (8) TMI 1081
Necessity of serving show cause notice - Form and content of show cause notice required to be served, before deciding as to whether the noticee is to be blacklisted or not - Held that:- When it comes to the action of blacklisting which is termed as 'Civil Death' it would be difficult to accept the proposition that without even putting the noticee to such a contemplated action and giving him a chance to show cause as to why such an action be not taken, final order can be passed blacklisting such a person only on the premise that this is one of the actions so stated in the provisions of NIT.
No such case was set up by the respondents that by omitting to state the proposed action of blacklisting, the appellant in the show cause notice has not caused any prejudice to the appellant. Moreover, had the action of black listing being specifically proposed in the show cause notice, the appellant could have mentioned as to why such extreme penalty is not justified. It is not at all acceptable that non mentioning of proposed blacklisting in the show cause notice has not caused any prejudice to the appellant. This apart, the extreme nature of such a harsh penalty like blacklisting with severe consequences, would itself amount to causing prejudice to the appellant.
We are of the view that the impugned judgment of the High Court does not decide the issue in correct prospective. The impugned order dated 11.9.2013 passed by the respondents blacklisting the appellant without giving the appellant notice thereto, is contrary to the principles of natural justice as it was not specifically proposed and, therefore, there was no show cause notice given to this effect before taking action of blacklisting against the appellant. We, therefore, set aside and quash the impugned action of blacklisting the appellant. The appeals are allowed to this extent.
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2014 (8) TMI 1080
Undisclosed source of money - Held that:- The assessee has received over ₹ 6 crores and deposited the same in the bank account and has also withdrawn the same and given to other persons. Now the assessee is not at all prepared to divulge the names or to provide any detail whatsoever. In our considered opinion the Revenue is very much correct in treating the same as income of the assessee.
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2014 (8) TMI 1079
Tax liability - service tax on renting of immovable property services - levy of penalty where bonafides are proved - Held that: - I find that Commissioner (Appeals) has fairly accepted the request that penalty invoking under section 78 of the Finance Act, 1994, was not leviable as bonafides were proved. The Ld. DR submitted that appellants contended that they were not aware about leviability of service tax on renting of immovable property services. He also pleaded that ignorance of Law cannot come to the waiver for the payment of duty. However it is fairly considered by dropping the penalty. Appellant have also complained that M/s. Nagar Palika Parishad have not been co-operating with the Department and have not provided them required information which has ultimately been collected by taking the recourse to RTI.
The penalty is rightly waived. But challenge to invocation of extended period of limitation on payment of duty due to ignorance of Law is not a valid ground. Once a service is provided and that service is taxable, tax liability has to be discharged accordingly - appeal dismissed - decided against Revenue.
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2014 (8) TMI 1078
Disallowance of deduction u/s 80IC - Held that:- Even in case of substantial expansion of an eligible unit claiming deduction u/s 80IC is allowable for a maximum period of 10 years from the inception. Therefore the claim of the assessee is valid in the eyes of law and is therefore is allowed. - Decided in favour of assessee.
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2014 (8) TMI 1077
Disallowance made under section 14A - Held that:- We find that the assessee had received dividend of ₹ 4,17 during the year under consideration,that on its own it had calculated the disallowance of ₹ 11,663/- u/s.14A r.w.r.8D of the Rules,that the FAA had deleted the addition of ₹ 181.95 lakhs and had confirmed the balance addition of ₹ 31.74 lacs, that the AO had filed appeal against the deleted of the disallowance whereas the assessee has challenged the order of the FAA for confirming the disallowance of ₹ 31.74 lakhs.We find that the FAA has deleted the addition because he was of the opinion that Rule 8D (2) (ii) was not properly applied by the AO. He found that interest expenses were related to the business of the assessee and not to the investment that yielded exempt income.In our opinion,no interest disallowance can be made if the assessee utilises borrowed funds for purposes other than investment.
In the matter under appeal the FAA has given a finding of fact that the assessee had borrowed loans from various banks for specific purpose like purchase of plant, machinery other assets working capital for business, purchase of raw material, packing material, stores & spares,etc,that the other interest and finance charges had also been incurred towards business of manufacturing of ready made garments, that the loans were for the specific purpose of the business,that the interest expenditure was directly related towards business income which was taxable.DR could not controvert the finding given by him. Therefore, confirming his order we decide the effective ground of appeal against the AO and hold that interest expenditure incurred by the assessee was not hit by the provisions of rule 8D (2)(ii)of the Rules. - Decided in favour of assessee.
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2014 (8) TMI 1076
Demand – imposition of penalties – 100% EOU – misdeclaration – import of capital goods without payment of customs duty as well as procuring of indigenously without payment of duty at the time of debonding - submission of list of capital goods at the time of debonding - Held that: - as the appellants were maintaining proper records regarding the capital goods received without payment of duties from which the Revenue found out the deficiency, no merit found in the contention of the appellant that omission of the capital goods such as generating sets etc. is not deliberate – appeal dismissed – stay application dismissed.
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9911796707
