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Showing 181 to 200 of 406228 Records
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2024 (5) TMI 183 - MADRAS HIGH COURT
Violation of principles of natural justice - Officer merely rejected the submissions of the petitioner without any reasoning - tax confirmed on the petitioner in terms of the proposals contained in DRC-01 issued to the petitioner, which preceded a notice in DRC-01A for the respective Assessment Years - HELD THAT:- The impugned orders set aside by giving the petitioner a fresh opportunity to substantiate the case afresh by filing a detailed reply to the respective notices issued to him in DRC-01.
The impugned order, which stands quashed shall be treated as Corrigendum to the notice issued to the petitioner for the respective Assessment Years under DRC-01. The petitioner shall file reply within a period of 30 days from the date of receipt of a copy of this order. The petitioner shall also pay 10% of the disputed tax for the respective Assessment Years. For the Assessment Year 2017-2018, while arriving at 10% of the disputed tax, the amount paid by the petitioner as tax for the Assessment Year 2017-2018, shall be excluded and on the balance amount, the petitioner shall pay 10% of the disputed tax within a period of 30 days.
Petition allowed.
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2024 (5) TMI 182 - MADRAS HIGH COURT
Failure to reply to SCN - alleged non reversal of Input Tax Credit (ITC) in respect of credit notes issued by the supplier - case of petitioner is that reply in Form ASMT 11 should have been taken into account - HELD THAT:- On perusal of the impugned order, it is noticeable that the notice in Form ASMT 10 is recorded therein. However, the reply of the petitioner thereto was not taken into account. Consequently, as is evident from paragraph 12 of the impugned order, the tax proposal was confirmed on the ground that the petitioner did not respond to the notices or attend personal hearing. Since the petitioner's reply to the notice in Form ASMT 10 was not taken into consideration in the impugned order, such order is unsustainable.
The impugned order dated 20.11.2023 is set aside and the matter is remanded for reconsideration. The petitioner is permitted to submit a reply to the show cause notice within 15 days from the date of receipt of a copy of this order.
Petition disposed off by way of remand.
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2024 (5) TMI 181 - GUJARAT HIGH COURT
Violation of principles of natural justice (audi alterem partem) - non-grant of opportunity of hearing to the petitioner as per provisions of Section 75(4) of the Central Goods and Service Tax Act, 2017 - rejection of refund without assigning any reason - HELD THAT:- It appears that impugned order of rejection of refund is passed without assigning any reason also. In such circumstances, the impugned order dated 01.12.2023 passed in Form-GST-RFD-06 under Rule 92(1), 92(3), 92(4), 92(5), 92(7), 92(5), 92(6) read with Sections 73 and 74 of the Gujarat Goods and Service Tax Act, 2017 (‘GST Act’, for short) is hereby quashed and set aside and the matter is remanded back to the Respondent No.2 for passing fresh order after de novo adjudication after giving opportunity of hearing and after assigning reasons for passing the order in accordance with law.
The present petition is disposed off.
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2024 (5) TMI 180 - ALLAHABAD HIGH COURT
Levy of maximum penalty - penalty imposed on the basis of technical error - non downloading of E-way Bill-01 was not done with intention to evade tax - HELD THAT:- Upon perusal of the record, it appears that the invoice contained the address, the goods matched the description in the invoice and all other materials were intact. The imposition of tax is only on the basis of a technical error. Furthermore, neither in the show cause notice nor in the order under Section 129(3) there was any allegation that non downloading of E-way Bill-01 was done with intention to evade tax. In spite of the same, the respondent authorities have chosen to impose maximum penalty whereas the law provides for lesser penalty under Section 122 of the Act.
The issue in the present petition is covered by Division Bench judgment of this Court in Harley Foods Products Ltd. vs. State of U.P. [2018 (11) TMI 704 - ALLAHABAD HIGH COURT], where it was held that 'Goods were accompanied with all the requisite documents including Gujarat e-way bill dated 21.03.2018, therefore, there was no ground to hold that the goods were coming in contravention of the provision of GST Act/Rule and the intention of the petitioner was to evade the payment of Tax' and thus no case made out with regard to evasion of tax.
The impugned order is set aside - petition allowed.
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2024 (5) TMI 179 - MADRAS HIGH COURT
Reopening of completed assessment - Difference in output tax liability between GSTR-1 and GSTR-3B returns - the tax proposal in respect of the said discrepancy was confirmed by an earlier order and that the petitioner intends to challenge such order by separate proceedings - under declaration of ineligible ITC and invalid ITC under Section 16(4) - HELD THAT:- On examining earlier order and the impugned show cause notice, it is clear that they pertain to assessment period 2018-19. The first issue in the impugned show cause notice is the same issue determined under order dated 23.12.2023. Undoubtedly, it is not open to the respondent to reopen the same issue after issuing the earlier order.
Petition is disposed of by directing the petitioner to respond to the show cause notice only insofar as it pertains to the issues of under declaration of ineligible ITC and invalid ITC under Section 16(4) - As regards the issue relating to reconciliation of GSTR-1 and GSTR-3B, the impugned show cause notice is set aside to that extent.
Petition disposed off.
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2024 (5) TMI 178 - MADRAS HIGH COURT
Violation of principles of natural justice - non-service of SCN - petitioner unable to reply to the show cause notice or participate in proceedings because such notice and order were only uploaded on the “view additional notices and order” tab of the GST portal, and not communicated to the petitioner through any other mode - HELD THAT:- The documents on record disclose that the petitioner replied to the notice in Form GST ASMT 10, but failed to respond to the intimation and show cause notice that followed. As is evident from the impugned order, tax liability was confirmed because the petitioner did not reply to the show cause notice. It is also noticeable that the petitioner's reply to the notice in Form GST ASMT 10 was not taken into consideration. In these circumstances, albeit by putting the petitioner on terms, it is just and appropriate that the petitioner be provided an opportunity.
The impugned order dated 08.12.2023 is set aside on condition that the petitioner remits 10% of the disputed tax demand within two weeks from the date of receipt of a copy of this order - petition allowed.
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2024 (5) TMI 177 - DELHI HIGH COURT
Benefit of exemption from GST - educational institution or not - Rejection of refund of the Goods and Services Tax (GST) in respect of the part of the Financial Year 2020-21 – April, 2020 to August, 2020 - tax paid under a mistaken understanding of the law - contradiction between Circular No. 151/07/2021-GST dated 17.06.2021 and N/N. 12/2017 – Central Tax (Rate) dated 28.06.2017 - scope of examination of services in terms of the 2017 Notification.
Scope of examination of services in terms of the 2017 Notification - whether the provision of any services is exempted (chargeable at Nil rate) from payment of GST? - National Eligibility-cum-Entrance Test (NEET) for admission to any medical institution in India - Degrees of Diploma of National Board (DNB) and Fellow of National Board (FNB) after conducting the examination - Conducts Screening Tests - Accreditation of Medical Institutions.
NEET EXAMINATION - HELD THAT:- The question whether the petitioner is an educational institution for the purposes of Clause (aa) of Serial No. 66 of 2017 Notification was expressly clarified by introduction of Clause (iv) in Paragraph 3 of the 2017 Notification. The said explanation clarified that the Central and the State Educational Boards would be treated as educational institutions for the limited purposes of providing services by way of conduct of examination to the students. The opening words of Paragraph 3(iv) of the 2017 Notification are “for removal of doubts”. The said Explanation is clearly clarificatory.
The question whether educational boards are to be exempted from services provided in conduct of examination was considered by the GST Council at its 28th Meeting held on 21.07.2018. The Fitment Committee had noted that the definition of educational institutions as contained in Paragraph 2(y) of the 2017 Notification did not cover State Educational Boards, Central Government Boards and autonomous organizations responsible for administration of education in India - Most of the State Boards and Central Boards were either boards set up by the Act of Parliament or State Legislatures or registered under the Societies Registration Act, 1860. Therefore, all examination boards except a few were Government entities. Any grant received by educational boards for providing services to government or any other person was also exempt.
Undisputedly, the question whether a provision is clarificatory or declaratory would not be dispositive of the question whether the same is applicable retrospectively. However, the fact that the language of the statute clearly reflects that it is for removal of doubts and to clarify doubts is a relevant indicator to determine whether the provision in fact intended to clarify and not intended to bring a prospective change. It is also relevant to determine whether the pre-amended law would admit such a clarification.
The service of holding an examination for aspirants to medical colleges, to provide a standard basis for entrance in medical institutions, the same would not fall within the ambit of Serial No. 66(a) of the 2017 Notification, as the same covers services provided by an educational institution to its students, faculty and staff. The candidates appearing for NEET examination are not students of the petitioner - More importantly, the Central Government has introduced a separate entry for exempting the services provided by an entrance examination – at Serial No. 66(a) of the 2017 Notification. Since, NEET examinations are in the nature of an entrance examination, the petitioner would be entitled to the benefit of an exemption by virtue of Serial No. 66(aa) of the 2017 Notification, which came into effect on 25.01.2018.
DEGREES OF DIPLOMATE OF NATIONAL BOARD (DNB) AND FELLOW OF NATIONAL BOARD (FNB) - HELD THAT:- Undeniably, the State Boards and educational boards are educational institutions. In the case of Secondary Board of Education, Orissa v. Income Tax Officer, Ward ‘E’, Cuttack [1972 (1) TMI 16 - ORISSA HIGH COURT], the Orissa High Court had observed that the Board of Secondary Education is not a university but it is indisputably an educational institution. ‘Education’ is included within the definition of charitable purpose under Section 2(15) of the Income Tax Act, 1961 and the said expression has been read in an expansive manner.
The course of DNB and FNB is a structured course. Although the students conduct their training with accredited medical institutions, the course is structured and managed by the petitioner. There is also no doubt that the students undergoing the said course are enrolled with the petitioner. Thus, although there is no classroom teaching by the petitioner; it is, undoubtedly, involved in imparting education to the students enrolled with it as a part of a curriculum. The course fee collected by the petitioner is forwarded to various accredited hospitals - for the purposes of DNB and FNB courses and conduct of Fellow Entrance Examinations, DNB-PDCET exam, FAT, DNB and FNB final examination (theory and practical) and the Fellowship Exit Exam, the petitioner clearly falls within the scope of an educational institution imparting education to students enrolled with, it as a part of a curriculum.
There can be no dispute that no GST is chargeable in respect of the services rendered by the petitioner in connection with DNB and FNB courses. The petitioner is indisputably involved in conduct of DNB and FNB courses and therefore, squarely falls within the definition of an educational institution in respect of the services rendered to its students in connection with and as a part the said courses.
SCREENING TEST AND ACCREDITATION OF MEDICAL INSTITUTIONS - HELD THAT:- The services provided by the petitioner for conducting screening test and the fees charged for accrediting medical institutions does not fall within the scope of Serial No. 66(a) and Serial No. 66(aa) of the 2017 Notification - The screening tests are not conducted as a part of the curriculum. The said tests are also not in the nature of entrance examinations but are for the purposes of recognising primary medical qualifications secured by candidates from institutions abroad. The accreditation fee is charged from medical institutions for accrediting them. These services are also not covered under the relevant entries of the 2017 Notification. The candidates appearing for the screening tests are not students of the petitioner. Thus, the petitioner’s contention that it is exempt from payment of GST in respect of such services, is unmerited.
The orders rejecting the petitioner’s application for refund, which are impugned in this petition, are set aside. The matter is remanded to the appropriate authority for considering afresh - Petition disposed off by way of remand.
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2024 (5) TMI 176 - MADRAS HIGH COURT
Validity of assessment order - failure to provide a reasonable opportunity to the petitioner - violation of principles of natural justice (audi alterem partem) - HELD THAT:- On perusal of the orders impugned herein, it is evident that the tax demand pertains entirely to the discrepancy between the petitioner's GSTR 3B returns and the auto populated GSTR 2A. Learned counsel for the petitioner asserts that the petitioner is in a position to produce necessary documents in compliance with Circular No.183. In these circumstances, albeit by putting the petitioner on terms, it is just and necessary to provide another opportunity to the petitioner.
The orders impugned herein are set aside subject to the condition that the petitioner remits 10% of the disputed tax demand in respect of each assessment period as agreed to within a period of two weeks from the date of receipt of a copy of this order - Petition disposed off.
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2024 (5) TMI 175 - MADRAS HIGH COURT
Breach of principles of natural justice - Petition was unaware of proceedings culminating in the impugned assessment order on account of the fact that GST compliances had been entrusted to a consultant, who had not informed the petitioner of such proceeding - discrepancy between the petitioner's GSTR-3B and auto-populated GSTR-2A - HELD THAT:- On perusal of the impugned order, it is evident that such order relates to the discrepancy between the GSTR 3B and GSTR – 2A returns. The petitioner has placed on record several documents to establish that the petitioner was entitled to avail of ITC. Since the petitioner was not heard before the impugned order was issued, principles of natural justice warrant interference so as to provide an opportunity to the petitioner. It should be noticed that the petitioner remitted 10% of the disputed tax demand, before filing this writ petition.
Therefore, the impugned order dated 03.03.2023 is set aside and the matter is remanded for reconsideration. The petitioner is also permitted to file a reply to the show cause notice within 15 days from the date of receipt of a copy of this order - Petition disposed off.
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2024 (5) TMI 174 - ANDHRA PRADESH HIGH COURT
Levy of GST on the value of the by-products i.e., broken rice, bran and husk - HELD THAT:- When the matter is listed, both the learned counsel for petitioner as well as learned Government Pleader for Commercial Taxes would admit that the subject matter of this Writ Petition iin SHIRIDI SAINATH INDUSTRIES VERSUS DEPUTY COMMISSIONER OF SERVICES TAX (INTERNATIONAL TAXATION) [2021 (1) TMI 175 - ANDHRA PRADESH HIGH COURT], where it was held that 'the impugned Assessment Order passed by the 1st respondent in so far as it relates to the levy of GST on the value of by-products i.e., broken rice, bran and husk treating them as part of the consideration paid to the petitioner for milling of the paddy, is set aside'.
This Writ Petition is allowed and the impugned Assessment Order dated 24.09.2019 passed by the 1st respondent in so far its relates to levy of GST on the value of the by-products i.e., broken rice, bran and husk treating them as part of the consideration paid to the petitioner for milling of the paddy is set aside.
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2024 (5) TMI 173 - MADRAS HIGH COURT
Validity of assessment order - non-speaking assessment order - non-application of mind - violation of principles of natural justice - reversal of ITC - HELD THAT:- On examining the impugned order, it is evident that the tax liability of the petitioner under about '7' heads was determined therein. As regards turnover mismatch, the assessing officer set out the particulars provided by the petitioner, recorded that the petitioner had produced the balance sheet and profit and loss account for the year 2017-2018 and thereafter recorded the following conclusion: “The reply of the dealer is not acceptable”. Thus, the assessing officer has merely recorded a conclusion in the nature of ipse dixit without any reasoning to support such conclusion.
Reversal of ITC - HELD THAT:- The assessing officer has recorded the conclusion that ITC was used partly for effecting taxable supplies and partly for effecting exempt supplies. The latter conclusion appears to be clearly contrary to the submissions made by the assessee. As regards tax liability under the head 'sundry creditors', the petitioner/assessee stated that the payments to creditors are below 180 days and Rule 37 was not contravened. It was further stated that no ITC was involved. The reply of the assessee dated 09.10.2023 clearly discloses that the sundry creditors' list, payment date, bank date and bank statement were enclosed. Without considering these documents, a finding that bank statement was not provided is recorded in the impugned order.
It appears that the impugned order was issued without taking into account the relevant material placed on record by the assessee. Consequently, the said order calls for interference and is hereby quashed.
The matter is remanded for reconsideration by the assessing officer. After providing a reasonable opportunity, including a personal hearing, to the assessee, the assessing officer is directed to issue a fresh assessment order within a maximum period of two months from the date of receipt of a copy of this order - petition disposed off by way of remand.
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2024 (5) TMI 172 - RAJASTHAN HIGH COURT
Levy of GST on royalty paid to the respondent-Mining Department towards mining lease - challenge to SCN/assessment orders - HELD THAT:- In SUDERSHAN LAL GUPTA CONTRACTOR VERSUS UNION OF INDIA, STATE OF RAJASTHAN, CENTRAL BOARD OF INDIRECT TAXES AND CUSTOMS, DEPUTY COMMISSIONER OF STATE TAX, CIRCLE KARAULI, RAJASTHAN [2022 (10) TMI 43 - RAJASTHAN HIGH COURT] the Division Bench of this Court has held that the action of respondents with regard to imposition of GST on royalty is not liable to be interfered with.
This writ petition is dismissed in terms of the orders passed by this Court in Sudershan Lal Gupta’s case.
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2024 (5) TMI 171 - ANDHRA PRADESH HIGH COURT
Maintainability of appeal - appeal dismissed at the admission stage on the ground that it was barred by limitation and beyond the condonable statutory period - sufficient cause for delay or not - cancellation of GST registration - HELD THAT:- Though the impugned order in view of Section 107 of APGST Act does not suffer from any illegality, as the appellate authority cannot condone the delay beyond statutory condonable period but considering that there was sufficient cause for not preferring appeal in time, the interest of justice requires condonation of the delay. The appeal is a valuable statutory right.
In exercise of writ jurisdiction to do complete justice and provide opportunity of hearing on merits of the appeal, the delay is condoned by imposing costs of Rs. 20,000/-. The appellate authority shall consider and decide the appeal on merits in accordance with law, expeditiously. The Costs shall be deposited in two (02) weeks from the date of receipt of copy of this order before the appellate authority.
Petition allowed.
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2024 (5) TMI 170 - DELHI HIGH COURT
Validity of reopening of assessment u/s 147 - scope of new regime of reopening of assessment after introduction of provisions of section 148/148A - whether the respondents, under the facts of the present case, are legally justified in reinitiating assessment proceedings for the same AY, which had already been subjected to reassessment? - HELD THAT:- Undisputedly, the respondents have proceeded to pass an order under Section 148(A)(d) of the Act premised on an identical ground of escapement of income as alleged in the original notice for reassessment issued on 31 March 2021. It is also not the case of the respondents that they had sought to recommence the concluded reassessment proceedings based on certain new information or additional grounds of escapement of income. Rather, they have only relied upon the decision of Ashish Agarwal (2022 (5) TMI 240 - SUPREME COURT] to wield power to proceed with the reassessment. Thus, the only question which needs to be examined is whether the decision in Ashish Agarwal (supra) commands an authority to reopen even concluded assessment proceedings.
Recently, we had an occasion to extensively deal with a similar challenge as has been laid in the instant writ petition in the case titled as Anindita Sengupta [2024 (4) TMI 96 - DELHI HIGH COURT] whereby, it was held that the procedure envisaged in Ashish Agarwal (supra) unambiguously stood confined to matters where although notices may have been issued, proceedings were yet to have attained finality.
The facts that assessment under Section 147 of the Act was already concluded, said proceedings were completely ignored and no new material was unearthed, closely resemble the factual scenario in the case of Anindita Sengupta (supra). Thus, the controversy in hand is squarely covered by our decision in Anindita Sengupta (supra). We, therefore, find it appropriate to allow the instant writ petition.
Accordingly, the impugned notices issued under Section 148(A)(b) and Section 148, respectively and the impugned order passed under Section 148(A)(d) of the Act are, hereby, quashed. Decided in favour of assessee.
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2024 (5) TMI 169 - DELHI HIGH COURT
Reopening of assessment - reason to believe - meaning of the phrase ‘true and full disclosure’ - cash transactions unexplained - petitioner contends that the said transactions are a part of the loan transactions between the petitioner including amalgamated companies and Mr. Manoj Sethi, which have been done via cheque/RTGS method of banking - whether the AO has correctly assumed jurisdiction under Section 147 of the Act on the ground of lack of full and true disclosure on the part of the assessee during the original proceedings? - HELD THAT:- In the instant case, the petitioner has not been able to allude to any enquiry either expressly or indirectly conducted by the respondent in the earlier assessment proceedings qua the issue under consideration, which could suggest that the present proceedings are merely based upon a change of opinion. Thus, the AO cannot be said to have traversed beyond its mandate to assume jurisdiction under Section 147 of the Act.
Thus we do not find any merit in the arguments put forth by the petitioner and consequently, the petition stands dismissed. These observations have been made only for the purpose of deciding the challenge which stands raised before us; they should not be construed to be an expression on the merits of the case or otherwise.
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2024 (5) TMI 168 - MADHYA PRADESH HIGH COURT
Addition u/s 14A - disallowance in cases where no exempt income has been claimed by the assessee during the year under consideration - ITAT deleted addition - as submitted ITAT ignoring the CBDT Circular No. 05 of 2014 dated 11.02.2014 and amendment to Section 14 of the Act inserted by the Finance Act, 2022
HELD THAT:- From the perusal of the order of the assessing authority, it appears that the assessing authority did not consider the documents submitted by the assessee during the course of the assessment proceeding and this fact came to light from the observation made by the appellate authority that despite availability of documents, additions were made by the assessing authority.
Amendment brought in Section 14 (A) of the Act inserted by the Finance Act, 2022, inserting explanation which is clarificatory in nature hence have retrospective effect - It is clear that the contention of appellant in respect of question no.3 (a) is not relevant in this case as the assessment is for the year 2013-14, therefore, the amendment proposed in Section 14 (A) of the Act as discussed hereinabove would not be applicable in the present case and the submission of the appellant in respect of Section 14 (A) of the Act is not relevant in light of the amendment, therefore, the contention of the appellant to this effect that order of CIT appeal as well as an order of ITAT may be quashed is hereby rejected.
The judgment rendered in the case of Chivenwest [2015 (9) TMI 238 - DELHI HIGH COURT] is worthy of reference, where it has been categorically held that Section 14 (A) of the Act will not apply, if no exempt income is received or receivable during the relevant previous year by the assessee and this finding is just and proper and further contention of the appellant in respect of the pendency of the case in the Apex Court i.e. PCIT vs. Adani Wilmart Ltd. [2021 (8) TMI 1390 - SC ORDER] against the order of the [2021 (1) TMI 1260 - GUJARAT HIGH COURT] and in the PCIT Vs. Karnataka State Financial Corporation [2021 (4) TMI 652 - KARNATAKA HIGH COURT] against the judgment of the Karnataka High Court are concerned, in the cases of the High Court, relief has been granted to the assessee by holding that no disallowance of the expenditure under Section 14 (A) of the Act can be made more than exact annual income earned by the assessee and it is the view of this Court that until and unless the issue travelled uptil Apex Court modifying or setting aside judgment of the High Court.
Disallowance of operating expenses, cost of material consumed, employee benefits and other expenses debited in P&L account of the company - assessee failed to produce any details, documents and evidences to substantiate these expenses - ITAT upholding CIT(A) order of deleting addition - So far as other questions are concerned, since the same are based upon fact finding and we have already discussed the order of the CIT(A) and ITAT and find that the order of the CIT (A) is well reasoned order and disallowance made by the AO is contrary to the settled norms and in this case we approve the findings that according to the demand of the AO, assessee submitted all the relevant documents but before disallowing, no findings have been recorded by the AO and the order of the CIT (A) has been upheld by the ITAT and the addition made by the AO in the case of assessee for an amount has rightly been deleted.
This Court is of the considered opinion that to maintain the parity in light of the view taken by the different High Courts, we are inclined to hold that deletion has rightly been made by the CIT (A) which was further affirmed by the ITAT and, therefore, no interference is warranted in the facts and circumstances of the case.
Revenue appeal dismissed.
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2024 (5) TMI 167 - BOMBAY HIGH COURT
Reopening of assessment - reasons for re-opening within or beyond 4 years - reasons to believe - basic contentions of the revenue for re-opening the assessment is that firstly under-invoicing of export and failure on the part of assessee to disclose fully and truly all material and commission paid to the foreign agents - HELD THAT:- As already dealt with the reasons for re-opening of the assessment on the basis of material borrowed from DRI authorities and how it cannot be considered as tangible material having a live link for the purpose of forming independent opinion of the AO, which is infact not formed in all the matters. Thus, as far as the re-opening on the basis of borrowed material from DRI is concerned, we are firm on our opinion that such material without application of mind of the Assessing Officer could not have been directly borrowed and used.
As far as the report of Justice M.B. Shah Commission is concerned, the Co-ordinate Bench of this Court [2019 (8) TMI 16 - BOMBAY HIGH COURT] (S.C. Gupte & N.D. Sardessai, JJ.) clearly observed that the third report of Justice M.B. Shah Commission contains merely the expression of its opinion and it lacks finality as well as authoritativeness. Only on the basis of expression of such opinion by the commission, there cannot be any prima facie belief which could be recorded by the Assessing Officer, without any independent material for the purpose of re-opening.
In the present matters, the reasons for re-opening clearly goes to show that Assessing Officer, except borrowing the information from the third report of Justice M.B. Shah Commission, failed to record independently to his own satisfaction any reason so as to direct re-opening of assessment. We do not see any reason independently forming opinion by the Assessing Officer, apart from what was borrowed from the Justice M.B. Shah Commission report. Thus, such reasons which are not having any application of mind as well as any independent material and reason to believe, cannot be construed as legal reasons for re-opening of the assessment.
Finally, in some matters it is claimed that the assessee failed to disclose fully and truly the material findings that beyond 22.11.2007, the mining activities were illegally continued. In all these matters, the returns were filed somewhere in the year 2009-10, even though, there was no such decision passed by the Apex Court holding that mining leases beyond 2007 were illegal.
It is a fact that for making disclosure truly and fully the assessee must have the knowledge of it. It is necessary to note here that the case of Goa Foundation Vs. Union of India [2015 (8) TMI 723 - SUPREME COURT]. While deciding the said petition, the Supreme Court observed that the mining leases in Goa expired in the year 1997 and thereafter, renewal could have been granted only for 20 years upto 2007.
Thus, the Apex Court observed that from November 2007 all mining leases in Goa are required to be considered as illegal for the simple reason that there was no power to renew such leases beyond 20 years. The fact remains that these observations of the Apex Court are in connection with mining leases, however, the Apex Court no where expressed that till the date of such decision i.e. 21.04.2014, the mining activities carried on by the lease-holders were considered to be illegal. The illegality of the lease is one thing and carrying out business activities on assuming that such leases exists is another thing. Similarly, business activities were carried out and Iron Ore was extracted, sold, exported till all the activities came to a grinding hold. The lease-holders paid royalty, customs duty, other charges to the Government till such activities were stopped. Extraction of Iron Ore including export and payment of remaining charges to the concerned department till 2014 were not declared as illegal. Even this fact, that the mining leases beyond 2007 were not legal, was even not known to the Assessing Officer himself, till such declaration came from the Apex Court in the year 2014.
Thus, claiming that the assessee failed to disclose truly and fully that such activities were illegally carried out and that too while filing returns for the assessment year 2009-10 would not arise. In this regard the observation in the case of Calcutta Credit Corporation [1969 (12) TMI 30 - CALCUTTA HIGH COURT] would clearly attract.
Thus, we are of the considered opinion that notices issued for re-opening and assessment in all these matters failed to satisfy twin conditions. The Assessing Officer, therefore, could not have exercised jurisdiction for re-opening of assessment which were concluded way back.
The additional affidavit filed in two petitions cannot be looked into for the above reason as Revenue or the AO is not entitled to supplement material beyond the reasons recorded at the time of issuance of notice under section 147/148 of Income Tax Act.
We hold that the impugned re-opening notices and the orders passed rejecting the objection needs interference and are required to be quashed and set aside. Decided in favour of assessee.
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2024 (5) TMI 166 - BOMBAY HIGH COURT
Validity of Re-assessment proceedings u/s 147 - Earlier the notice for Assessment u/s 153A/C was issued - denying deduction u/s 80IB - petitioner’s case that it was not subjected to search and seizure action - HELD THAT:- Section 147 provides for a clear bar that where an income, which is subject matter of any appeal, reassessment of such income is not permissible. The reason to believe escapement of income provides “Notice u/s. 153A/C of the IT Act, 1961 was issued. During the year under consideration the assessee has shown that the project is completed and in its P&L A/c. credited to the total sale consideration and entire profit was claimed as deduction u/s. 80IB (10). AO has made addition on account of deduction in WIP and denied the deduction u/s. 80IB (10) as project is not as approved project in the hands of the assessee because the commencement certificate is not issued to Mr. Harshad Doshi nor his AOP Poonam Builders. Secondly the first approved plan is dated 27.11.1997 which is before 1.10.1998. Thus by no means, the assessee is eligible to claim the benefit of deduction u/s. 80IB (10)"
Thus Escapement of income due to claim of deduction under Section 80IB (10) was certainly a subject matter of appeal and admittedly so and, therefore, in our view, on this income reassessment is not permissible. As held by the Hon’ble Apex Court in Abhisar Buildwell (P.) Ltd. [2023 (4) TMI 1056 - SUPREME COURT] Revenue could initiate reassessment proceedings subject to fulfilment of the conditions mentioned in Sections 147/148 of the Act, i.e., so long as it is not hit by the third proviso to Section 147 of the Act. Reopening notice set aside - Decided in favour of assessee.
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2024 (5) TMI 165 - TELANGANA HIGH COURT
Rectification of mistake u/s 154 - tax relating to ‘retention money’ - tax paid on more than one occasion, and claims its refund under Section 154 - HELD THAT:- As the authority has perused the record and on the basis of record, he gave a finding that assessee has offered tax on ‘excess’ retention money. Thus, no elaborate arguments are needed to establish the error as respondent No.2 himself found the same from the record about the payment of tax in excess on the ‘retention money’.
As decided in Nirmala L. Mehta vs. A. Balasubramaniam, CIT [2004 (4) TMI 43 - BOMBAY HIGH COURT] Bombay High Court emphasized that no ‘estoppel’ can arise against the statute. Article 265 of the Constitution of India expressly lays down that taxes can only be levied or collected through the authority of law. Hence, ‘acquiescence’ cannot deprive a party of rightful relief when taxes are levied or collected without legal authority.
Also in Smt. Sneh Lata Jain [2004 (4) TMI 579 - JAMMU & KASHMIR HIGH COURT] once it is found that the petitioner has no tax liability, the respondents cannot be permitted to levy the tax and collect the same in contravention to Article 265 of the Constitution of India, which provides a constitutional safeguard on levy and collection of tax. It is true that this Court is not to act as Court of appeal while exercising the writ jurisdiction, but at the same time where the admitted facts disclosed non- exercise of jurisdiction by an adjudicatory authority and a citizen is subjected to tax not payable by him, interference by this Court is warranted.
As in our judgment, respondent No.2 has erred in holding that the error shown above does not fall within the ambit of ‘error apparent on the face of record’ and consequently, cannot be corrected under Section 154 of the Act. The view taken by the learned respondent No.2 is hyper technical in nature and runs contrary to the scheme flowing from Article 265 of the Constitution of India.
So far the judgment of Division Bench of this Court in the case of MS Educational and Welfare Trust [2022 (3) TMI 901 - TELANGANA HIGH COURT] is concerned, it is noteworthy that this Court opined that the power of rectification of an order of assessment under Section 154 of the Act lies within a very narrow compass. As clearly held that the order to be rectified must be an order which reflects ‘error apparent on the face of record’. Since we have held that the error in the instant case is indeed of that character, the said judgment will not improve the case of the respondents.
Consequently, the Writ Petition stands allowed and the impugned order is set aside. Respondent No.2 is directed to undertake exercise of return of excess tax on ‘retention money’ and pass appropriate order and return the requisite tax money to the petitioner within a period of 60 days from the date of production of copy of this order.
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2024 (5) TMI 164 - BOMBAY HIGH COURT
Validity of Assessment Order u/s 143(3) once the Resolution Plan is approved under the Code - CIRP proceedings under IBC - Effect of Resolution Plan approved by the NCLT - HELD THAT:- Since the Resolution Plan expressively provides that no person shall be entitled to initiate any proceedings or inquiry, assessment, enforce any claim or continue any proceedings in relation to claims so long such result to a period prior to the Effective Date of the Resolution Plan, i.e., 10th November 2022 impugned notices are bad in law.
Further, the impugned notices are bad in law also because respondents failed to take into account that after approval of the Resolution Plan by the NCLT, a creditor including the Central Government, State Government or local authority is not entitled to initiate proceedings on the Resolution Applicant, in relation to claims which are not part of the Resolution Plan approved by the NCLT.
Pertinently, respondents had not submitted any claims to the IRP, as required under the Code, despite the public announcement being issued by the IRP, as prescribed under the Code.
The impugned notice issued u/s 143(2) of the Act by Respondent No. 1 and the consequential impugned notices issued u/s 142(1) of the Act by Respondent No. 2 and all subsequent communications issued by Respondent No. 2 pursuant to the aforementioned impugned notices are bad in law since assessment and inquiry under the Act is sought to be initiated in gross violation of provisions of the Code in as much as it relates to a period prior to the Effective Date.
The impugned notice issued under Section 143(2) of the Act and the impugned notices issued under Section 142(1) of the Act and all subsequent actions undertaken pursuant to the impugned notices issued under Section 142(1) of the Act are bad in law as no proceedings can be initiated against petitioner for a period prior to the Effective Date. Pertinently, the Resolution Plan provides that new claims, disputes, litigations or other judicial or administrative proceedings (including assessments) etc., will be deemed to be barred and shall not be initiated or admitted against Petitioner in relation to any period prior to the Effective Date.
The approved Resolution Plan clearly provides that any claim and/or liability pertaining to the period prior to the Effective Date (i.e., 10th November 2022) stood extinguished and/or settled in terms of the Resolution Plan. The NCLT approved the Resolution Plan on 14th October 2022, which is binding on all stakeholders of petitioner including respondents. Reassessment proceedings set aside.
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