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Showing 181 to 200 of 1486 Records
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2020 (3) TMI 1306
Re-quantification of penalty imposed under u/s 116 of CA for short landing of goods - It is the contention of the petitioner that the original Authority had wrongly calculated the discharge quantity to arrive at the short landed quantity for the purpose of imposition of penalty under Section 116 of the Customs Act, 1962 - tolerance limit of 1% to .5% was considered - applicability of Indian Carriage of Goods by Sea Act, 1925 - HELD THAT:- Though the provision of the Indian Carriage of Goods by Sea Act, 1925, codifies the Hague Rules, Protocol of Signature, (Brussels, 25 August 1925), it has no application for discharge of imported cargo within India from vessels coming from outside the country - The Hon’ble Supreme Court in East and West Steamship & Co. George v. S.K.R., [1960 (5) TMI 38 - SUPREME COURT], has also noted the Section 2 of the Indian Carriage of Goods by Sea Act, 1925, states that rules set out in the Schedule shall have effect only in relation to and in connection with the carriage of goods by sea in ships carrying goods from any port in India to any other port whether in or outside India.
Thus, the said Act is not relevant for considering whether the person-in-charge of the conveyance can state that the bill of lading quantities are not binding of vessels/conveyance or its master. Therefore, the arguments of the Learned Counsel for the petitioner on this ground cannot be entertained.
Vessel is permitted to discharge liquid cargo only after a ullage survey is carried out under supervision of the Customs Officer and such survey report is signed not only by the Customs officer, but also by the ship-owner or/and the consignee and its agent - After the discharge of the liquid cargo from the vessel, a fresh survey is to be carried out in presence of the Customs Officer. The discharge completion survey report is to be signed by the Customs officer, ship-owner and the consignee or its agent - The difference in the Bill of Lading Quantity or the ullage Survey Report at the Port of loading with the ullage Survey Report at discharge port is to be treated as short landed quantity for the purpose of Section 116 of the Customs Act, 1962.
From the reading of the judgment of this Court in CAG Shipping (India) Pvt. Ltd. v. The Government of India and Others, [2016 (9) TMI 619 - MADRAS HIGH COURT] Fluorspar contains moisture to facilitate handling and to reduce dust and therefore presence of high moisture content was recognised. There, the Adjudicating Authority had allowed only 0.5% which is universal accepted principle in Maritime law for all the import cargo. However, considering the nature of the import cargo, there the Court had allowed the tolerance limit at 6.47% according to the parameters published by Mr. Michael Miller, an internationally renowned expert on chemicals who had opined that Acid Grade Fluorspar is shipped routinely in the form of damp Filtercake containing 7% to 10 % moisture.
The petitioner is directed to remit the penalty re-determined by the 3rd respondent in respect of the following show cause notices within a period of thirty days from the date of receipt of a copy of this order - Petition allowed in part.
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2020 (3) TMI 1305
Grant of Anticipatory Bail - recovery proceedings by the Government of India and Public Sector Undertakings owned or controlled by the Government of India - extension of bail which got expired during lockdown period - HELD THAT:- As regards bail applications of convicts and under-trial prisoners, the High Court, on the administrative side, had taken a decision to hear applications seeking bail/anticipatory bails/suspension of sentence, as the case may be, and posted some of the cases for hearing tomorrow (26.03.2020) - Now, the Hon'ble Supreme Court in Suo Motu Writ Petition [2020 (4) TMI 572 - SC ORDER] has issued directions to the State Governments/Union Territories to constitute a High Powered Committee in respect of bail matters, which has already been done. Hence, this Court deems it fit that those applications need not be taken up for hearing and it is left to the High Powered Committee to decide.
In the interim order of the Hon'ble Supreme Court, there is no reference to the anticipatory bail applications. On instructions, Shri Ranjith Thampan, learned Additional Advocate General submitted that, in view of the National lock down for 21 days declared by the Hon'ble Prime Minister, and the difficulties expressed by the staff and Law officers attached to the Office of the Advocate General, they may not be able to attend the office or Courts. It is the further submission that it is not possible to get instructions from the officers concerned, and therefore, the learned Additional Advocate General, by letter dated 25.03.2020, has requested the Registrar General, High Court of Kerala that all the proceedings have to be postponed.
Thus, right of personal liberty guaranteed under Article 21 of the Constitution of India should not, at any rate, be infringed by arresting an accused, except in matters where arrest is inevitable. However, the State is at liberty to take appropriate decision in respect of heinous/serious offences and in rest of the cases, State may act accordingly.
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2020 (3) TMI 1304
100% EOU-EHTP - distribution of credit of input services - HELD THAT:- It is not in dispute that the subject services have been procured by the appellants for use in manufacturing their final products and further, there is no dispute with regard to payment of service tax on the subject input services of which credit has been availed/distributed by the appellant. In so far as the distribution of credit prior to the period when ISD registration was obtained, we find that the issue is no longer res integra inasmuch as the Hon’ble Gujarat High Court in the case of COMMISSIONER OF CENTRAL EXCISE VERSUS DASHION LTD [2016 (2) TMI 183 - GUJARAT HIGH COURT] has clearly decided the issue in favour of assessee to hold that mere non-obtaining of the registration as ‘ISD’ cannot disentitle the assessee from claiming the credit and the same is purely a procedural lapse which is curable in nature.
In the instant case, the appellant has obtained ISD registration though belatedly. However, the same cannot be the reason to deny the credit and therefore, by respectfully following the decision of the Hon’ble High Court, we are inclined to allow the credit on the said count. In so far as the invoices addressed to the units other than assessee’s ISD unit, there is no dispute that the subject input services have been received and tax has been duly paid thereon. The assessee’s entitlement of credit and distribution thereof has been decided by the High Courts and the Tribunal in the decisions referred supra wherein it has been held substantial benefit of credit should not be denied on technical and procedural grounds - the credit is otherwise eligible even if the export goods are exempted from payment of duty inasmuch as the intention of the Government is to export the goods and not the taxes. Therefore, there is no reason to deny credit on exempted goods which are exported outside India and hence, we uphold the appellant’s eligibility to avail credit in the instant case.
Denial of credit on services like catering, C&F services, freight on exported goods, travelling and vehicle maintenance services - HELD THAT:- No restriction was placed in the definition of ‘input services’ as was applicable during the impugned period. The definition appearing under Rule 2(l) of the Credit Rules was very wide covering within its ambit all the services which are used in or in relation to manufacture of final products. No exclusion was provided in the definition to deny the credit on aforesaid services. In so far as catering services, the decisions rendered for the period prior to amendment made in March, 2011 as also relied by the appellant, in the case of THE COMMISSIONER OF CENTRAL EXCISE VERSUS M/S. BHARATH HEAVY ELECTRICALS LTD., THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL [2016 (3) TMI 441 - MADRAS HIGH COURT] and THE COMMISSIONER OF CENTRAL EXCISE VERSUS M/S. BHARATH HEAVY ELECTRICALS LTD., THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL [2016 (3) TMI 441 - MADRAS HIGH COURT], the issue has been decided in favour of the assessee.
There are no reason to deny credit availed by the appellant in the instant case and hence, we uphold the appellant’s eligibility to avail credit.
Appeal allowed - decided in favor of appellant.
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2020 (3) TMI 1303
Refund of Service Tax paid - Payment to the builder in respect of a property which she has booked but later cancelled - certain discrepancy in the Chartered Accountant Certificate - HELD THAT:- There is a incongruence in the order-in-original and order-in-appeal. While the order-in-original rejects the refund claim as inadmissible, order-in-appeal rejects only on the ground of discrepancy in the Chartered Accountant certificate. It is apparent that the appellant was not confronted with the so-called defects in the CA certificate before rejecting the refund claim. Moreover, it is found that the issue of limitation has not been raised by the Original Adjudicating Authority or the first appellate authority. In these circumstances, it cannot be raised in remand proceedings as well.
The impugned order is set aside and the matter is remanded to Original Adjudicating Authority for fresh consideration - appeal allowed by way of remand.
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2020 (3) TMI 1302
Rectification of mistake - Supply or not - statutory contributions made to District Mineral Foundation (DMF) and National Mineral Exploration Trust (NMET) as per MMDR Act, 1957 - levy of GST under reverse charge mechanism - HELD THAT:- The authority, in the AAR Order ruled that the contributions made towards DMF & NMET are not separate transactions but are on account of the supply made & are directly linked to the royalty payable; also computed as a fixed percentage of royalty and hence are treated as part of the consideration payable for the Licensing Services for right to use minerals including exploration and evaluation.
It is clearly evident from the aforesaid AAR Order that the authority has considered all the submissions and issued the proper order. Hence there is no error/apparent mistake on the face of the record, in the said order and hence the instant application is not valid and is liable for rejection, in terms of Section 98(2) of the CGST Act, 2017 - the instant application filed by the applicant for rectification of mistake in the Advance Ruling is dismissed.
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2020 (3) TMI 1301
Deemed dividend u/s 2(22)(e) - CIT-A deleted the addition - HELD THAT:- AR Fairly agree that the issue in appeal is now covered by Hon’ble jurisdictional High Court’s judgment in the case of CIT Vs Mahavir Inductomelt Pvt Ltd [2017 (8) TMI 123 - GUJARAT HIGH COURT]
In a case in which an amount is received from a person other than the shareholder, as is the admitted position in this case, the provisions of Section 2(22)(e) cannot indeed be invoked. The CIT(A) was thus justified in granting the impugned relief in respect of the addition under section 2(22)(e). We, therefore, approve the conclusion arrived at by the learned CIT(A) in this regard, and decline to interfere in the matter on that count. - Decided against revenue.
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2020 (3) TMI 1300
Whether the Detaining Authority was justified in deferring the consideration of the representation till the receipt of the opinion of the Central Advisory Board? - Whether the Detaining Authority ought to have considered the representation independently and without waiting for the report of the Central Advisory Board? - HELD THAT:- From the judgment in ANKIT ASHOK JALAN VERSUS UNION OF IDNIA AND ORS. [2020 (3) TMI 248 - SUPREME COURT] it is evident that the Apex Court held that the principle laid down by the Apex Court in paragraph 16 of the decision in KM ABDULLA KUNHI AND ABDUL KHADER VERSUS UNION OF INDIA [1991 (1) TMI 244 - SUPREME COURT] virtually to the effect that the appropriate Government should wait till the opinion of the Central Advisory Board is received, has to be understood in the light of the subsequent decision rendered by another Constitution Bench of the Apex Court in KAMLESHKUMAR ISHWARDAS PATEL VERSUS UOI. [1995 (4) TMI 283 - SUPREME COURT]. Thus, it is evident that the Apex Court has laid down the law that despite the pendency of the case of the detenu before the Advisory Board, the Detaining Authority receiving a representation is bound to consider that representation independently and to pass orders thereon, within a reasonable time, without waiting for the report of the Advisory Board. Thus, in the light of the decision of the Apex Court in Ankit Ashok Jalan’s case the position is that the Detaining Authority ought not to have waited for the report of the Advisory Board and it ought to have considered Ext.P4 representation independently, within a reasonable time.
Whether the time taken by the Detaining Authority from 27-11-2019 till 14-1-2020 could be characterised as undue and avoidable delay violating the constitutional rights of the detenues? - HELD THAT:- Due to complete inaction on the part of the Detaining Authority on the representation received pending consideration of the case of the detenues before the Central Advisory Board, it can only be held that the constitutional rights of the detenues were violated. In such circumstances, it was held that the continued detention of the detenues in terms of the detention order would be illegal, invalid and unconstitutional. The same situation is obtained in this case. In the light of the indisputable facts obtained from the counter affidavits filed in this case, it can be seen that pendency of the case of the detenu before the Advisory Board was the reason for the Detaining Authority to withhold consideration of the representation. Once the Advisory Board’s opinion was obtained the Detaining Authority considered the representation and then rejected it and in between there occurred a delay of more than 60 days in consideration of the representation.
It is to be noted that in Ankit Ashok Jalan’s case the delay occurred in such consideration was only 47 days. Nonetheless, after laying down the law, as mentioned hereinbefore, the Apex Court allowed the writ petition, held the continued detention of the detenues concerned in terms of the detention orders challenged before the Apex Court, to be illegal, invalid and unconstitutional and thereupon quashed the detention orders.
The constitutional right of the detenu was violated and therefore, continued detention of the detenu and order of confirmation would be illegal, invalid and unconstitutional - petition allowed.
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2020 (3) TMI 1299
Transitional Input tax credit - inputs lying in their stock as on 30-6-2017, without having proper documents or not - HELD THAT:- The appellant has submitted copy of 58 VAT-invoices of M/s. TEXMO Industries in respect of ITC of ₹ 90,639/- availed by the appellant along with a certificate dated 17-1-2019 of excise duty paid by the principal manufacturer i.e. M/s. TEXMO Industries, Coimbatore. Whereas, Section 140(3)(iii) of the Act stipulates that the supplier should have in possession of prescribed documents evidencing payment of duty under the existing law (Central Excise Law) in respect of such inputs. I observe that the VAT invoices, submitted by the appellant, do not fulfil the conditions for being a valid document under Rule 9 of the Cenvat Credit Rules, 2004 or Rule 11 of the Central Excise Rules, 2002 (i.e. the existing law).
The appellant has also paid reliance upon the decision of Hon’ble Gujarat High Court in the case of DOWNTOWN AUTO PVT. LTD. VERSUS UNION OF INDIA [2019 (2) TMI 542 - GUJARAT HIGH COURT] - It is found that the above decision is an interim judgment not a final decision. Hence it will not be justified to use the same as in favor/against of any party.
The appellant was not in possession of prescribed documents evidencing payment of duty under the existing law for availing input tax credit of ₹ 90,639/-, as required under Section 140(3)(iii) of the Act - Appeal dismissed - decided against appellant.
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2020 (3) TMI 1298
Detention of goods alongwith conveyance - E-way bill got expired - imposition of IGST Tax and penalty - HELD THAT:- M/s. Herbalife International India Pvt. Ltd., Punjab is engaged in direct selling of its products through its large network of distributors dispatched the goods to the appellant i.e. M/s. Herbalife International India Pvt. Ltd., Rajasthan C/o. Jayem Warehousing Pvt. Ltd., E-734, Nakulpath, Lal Kothi Scheme, Near Vidhansabha and Jyoti Nagar Police Station, Jaipur-302015, the owner of the goods is a dealer under the provisions of CGST and RGST Act, 2017 having principal place of business at Jaipur and procures the finished goods from its branches/warehouses located in various other States on stock transfer basis and subsequently sells the same within the State of Rajasthan.
Neither the appellant nor the transporter have taken the necessary measures or precautions to ensure extension of validity of the E-way bill or generation of an alternate valid one in terms of Rule 138(10) of Central Goods and Services Tax Rules, 2017 and chose to transport the goods on the old E-way bill which was not a valid document. Therefore, appellant’s contention that the delivery of the impugned goods was delayed on account of shortage of space at the recipient’s warehouse, during which time the E-way bill expired and the e-way bill portal does not allow them raising of multiple e-way bills for same tax invoice is not acceptable - the appellant has taken a plea that the goods were being transferred from the location of the transporter to the recipient’s location which was within the distance of 50 kilometers.
The appellant could not prove with documentary evidence their stand that the goods were being transferred from the location of the transporter to the recipient’s location which was within the distance of 50 kilometers. Therefore, detention/seizure of goods and vehicle and initiation of penal proceedings cannot be faulted - appeal dismissed - decided against appellant.
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2020 (3) TMI 1297
Maintainability of appeal on low tax effect - Revenue has pleaded that the assessment was reopened on the basis of the audit objection, and it has been provided in the circular that if the assessment has been reopened on the basis of audit objection, then that appeal against the order of the ld.CIT(A) would be decided on merit instead of dismissing it on tax effect - HELD THAT:- We have confronted the Ld. DR with the CBDT Instruction bearing No.5/2017 dated 23/01/2017. These instructions provide that even if an assessment is being reopened on account of audit objection but the additions are deleted by the CIT(A) on merit, then for the purpose of challenging the order of CIT(A) in further appeal the case would be required to be examined on merit. Simply the appeal would not be filed because the case falls within the exceptional clause of the CBDT Instruction for not filing the appeal where the tax effect by virtue of relief granted by the CIT(A) is less than the monetary limit for filing such appeals. In other words, the Department has to assess the merits of the dispute involved and they will not file further appeal against the order of the CIT(A) or ITAT in a mechanical manner. See ASHOKKUMAR HARIKISHANBHAI BHAVSAR [2020 (1) TMI 1401 - ITAT AHMEDABAD]
Department has not brought any substantial material on the record pointing out that appeal was filed after evaluation of merit on the issues involved. It sought to recall the order of the Tribunal merely on the basis of audit objection, which is not sufficient for recalling the Tribunal order. Therefore, we do not find any error in the order of the Tribunal. Thus the miscellaneous application is rejected.
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2020 (3) TMI 1296
Seeking approval of the resolution plan - section 31 of the Insolvency and Bankruptcy Code, 2016 - HELD THAT:- As the corporate debtor is a cash-generating entity, the mandatory operational creditor payments and MMB payments shall be paid in full out of the cashflows of the corporate debtor or if the cashflows are insufficient, through fresh fund infusion into the corporate debtor by way of equity, quasi equity, sub-ordinate debt and/or shareholder debt or a combination thereof from the balance-sheet of the resolution applicant, in priority to any payment to any financial creditor. It is clarified that mandatory operational creditor payments shall be made in accordance with the timelines prescribed by the Code and the MMB payments shall be made by the corporate debtor on the effective date - The applicant states, that the port is a critical national asset and it is absolutely imperative that this resolution plan be allowed in order to protect the interests of all the stakeholders including but not limited to the lenders of the corporate debtor.
The applicant further states that he has examined the approved resolution plan received from APSEZ. As per the provisions of section 31(1) of the Code, the approved resolution plan is binding on all the stakeholder, employees, members, creditors and guarantors of the corporate debtor - Apart from the above, starting from the National Company Law Tribunal approval date till the effective date, the implementation and the monitoring committee shall be constituted and shall comprise of one nominee each of the resolution professional, the resolution applicant and the approving financial creditors.
The resolution plan seeks all benefits and incentives, including but not limited to, under all such incentive schemes, subsidy schemes and policies that the corporate debtor is entitled under, and all such benefits shall remain vested in the corporate debtor with effect from the effective date. The aforesaid relief is allowed subject to provisions of the respective schemes and policies - The applicant has certified, as per regulation 39 of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, that the contents of the resolution plan, as approved by the committee of creditors with more than 66 per cent. majority in favour, meets all the requirements of the I and B Code and the Regulations as applicable on the date thereof.
The resolution applicant has declared that neither the resolution applicant nor any of its related parties have failed to implement or contribute to the failure of implementation of any other resolution plan approved by the Adjudicating Authority at any time in the past - The resolution applicant, on taking control of the corporate debtor, shall ensure compliance under all applicable law for the time being in force.
The resolution plan has necessary provisions for its effective implementation. The CoC has approved this resolution plan with 99.68 per cent. votes in favour of the resolution plan - the resolution plan is approved with modifications, as mentioned above, which shall be binding on the corporate debtor and its employees, members, creditors, guarantors, resolution applicant and other stakeholders involved in the resolution plan.
The resolution plan is approved under section 31(1) of the I and B Code - application allowed.
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2020 (3) TMI 1295
CENVAT Credit - input services or not - general insurance policies like motor insurance, fire insurance, marine insurance and others - re-insurance service from Indian as well as foreign reinsurance companies in respect of these insurance policies also availed - Effect of amendment to the definition of “input service‟ in rule 2(l) w.e.f. April 1, 2012 - Extended period of limitation.
Whether re-insurance services are used for provision of insurance services and, therefore, would qualify as “input service‟ for the Appellant? - HELD THAT:- An insurer issues insurance policy to insure and assumes the risks arising thereunder. The insurance of such risks assumed by the insurer by another insurer is called re-insurance, which would, therefore, be insurance of insurance. Re-insurance, thus, is an insurance of insurer‟s risks. An insurance policy is issued for a specific term and it is for whole term of the policy that the insurer assumes the risk on the insured subject. This business of the insurer is insured by any insurer called a re-insurer and for this purpose the insurer pays a premium to the re-insurer - both insurance and re-insurance services are covered under the scope of the general insurance service classifiable under section 65(105)(d) of the Finance Act and chargeable to service tax. The Appellant has stated that it has paid service tax on the “output service‟ rendered by it. The re-insurers providing re-insurance services also pay service tax on output re-insurance service rendered by them to the Appellant and charge service tax form the Appellant. It is, therefore, clear that such reinsurance services are used by the insurer for providing output insurance service. Without the use of such re-insurance services, it may not be commercially prudent for any insurance company to assume such high risks under the original insurance policies. It is the assumed risks of the original insurer that are insured under the re-insurance policies. It is, therefore, difficult to hold that reinsurance services are not used by the insurer for providing the “output services‟. It would also not be correct to hold that since reinsurance services are availed after the provision of insurance services, CENVAT credit of service tax paid on re-insurance services cannot be availed. The insurance policy is issued for particular term during which the risks are assumed by the insurer and the re-insurance availed by the insurer is co-terminus with the original risks assumed by the insurer.
The issue that came up for consideration before the Karnataka High Court in PNB METLIFE INDIA INSURANCE COMPANY LTD VERSUS COMMISSIONER OF CENTRAL EXCISE, SERVICE TAX AND CUSTOMS [2014 (8) TMI 298 - CESTAT BANGALORE] where the issue was whether an assessee can avail CENVAT credit of service tax paid on reinsurance services by treating the said service as an “input service”. The Karnataka High Court examined whether CENVAT credit availed and utilized by the insurance company on service tax paid for re-insurance service is an “input service” for the “output service” of insurance that the company was providing and held that the process of issuance of the policy by the insurer and subsequent procurement of re-insurance policy from another company, which is a statutory requirement, is an integral part of the entire process and the insurance process does not come to end merely on the issuance of the insurance policy since it continues till the existence of the term of the policy. The High Court noted that since reinsurance has to be taken under section 101A of the Insurance Act, it is a statutory obligation and, therefore, has to be considered as having nexus with the “output service” and, therefore, would be an “input service”, for which CENVAT credit can be availed.
Whether the amendment to the definition of “input service‟ in rule 2(l) w.e.f. April 1, 2012 would affect the eligibility of the Appellant to CENVAT credit on reinsurance services during the relevant period? - HELD THAT:- It needs to be noted that motor vehicles have been excluded from the definition of “capital goods‟. For this reason, the general insurance services relating to such motor vehicles have also been excluded from the purview of “input service‟. The purpose of this amendment , thus, is to restrict the credit on insurance services availed in respect of motor vehicles to only two class of persons, i.e. (a) manufacturer of a motor vehicle in respect of a motor vehicle manufactured by such person; and (b) an insurance company in respect of a motor vehicle insured or re-insured by such person. This exclusion clause cannot be read to cover reinsurance services, which are not insurance services in respect of a motor vehicle. What is excluded under the said exclusion clause is general insurance services in respect of a motor vehicle. Insurance services received by an owner of motor vehicle for insurance of such vehicle stands excluded from the definition of “input service‟. However, a re-insurance service is not in respect of a motor vehicle, but is in respect of the assumed risks of an original insurer and thus, the aforesaid exclusion clause has no application to qualification of re-insurance services as “input service‟.
Whether the Appellant is eligible to avail CENVAT credit of re-insurance service provided by pool member companies under the Insurance Pool? - HELD THAT:- Under the pool arrangement, the Appellant deposits the whole premium collected by it in the pool account and based on the prescribed formulae, the GIC determines the amount of re-insurance premium due to each member as against the other members. Thus, in effect, each company pays the re-insurance premium after deducting the amount due from the other member companies. The service tax liability stands discharged on the whole re-insurance premium paid to the other members. It cannot be, therefore, be urged by the Department that the invoices that are issued by the pool member companies are not for any provision of service or without any payment. The re-insurance services are provided by the pool member companies and it is for this reason that the Insurance Pool was formed by IRDA - it cannot be doubted that re-insurance services are rendered by pool member companies to each other and payment of premium takes place with the pooling of the original premium into the pool. The Appellant would, therefore, be eligible to avail the CENVAT credit of service tax paid thereon. The impugned orders denying such CENVAT credit cannot, therefore, cannot be sustained.
It is not necessary to examine whether the extended period of limitation could have been invoked in the facts and circumstances of the case.
Appeal allowed - decided in favor of appellant.
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2020 (3) TMI 1294
Exemption claim u/s 10(38) - HELD THAT:- Assessee has not been given a fair opportunity to prove the genuineness but the assessment has been made based, primarily, on the evidences collected by the Revenue in the course of the investigation conducted by them on brokers / share broking entities etc. This is not permissible. This being so, in the interests of natural justice, the issue of the genuineness of the transactions require re-adjudication. Since, the right to exemption must be established by those who seek it, the onus therefore lies on the assessee.
In order to claim the exemption from payment of income tax, the assessee had to put before the Income Tax authorities proper materials which would enable them to come to a conclusion.Thus, the AO must keep in mind that the onus of proving the exemption rests on the assessee. If the AO does have any evidence to the contrary, it is to be put to the assessee for his rebuttal. The internal communications of the Revenue are evidences for drawing an opinion on possible wrong claims but they are not the final evidence.
we deem it fit to remit the issues of exemption claim in this appeal back to the file of the A.O. for readjudication on the lines indicated above. Therefore, the A O shall require the assessee; to establish who, with whom, how and in what circumstances the impugned transactions were carried out etc., to prove that the impugned transactions are actual, genuine etc. The assessee shall comply with the A.O’s requirements as per law. The Assessing Officer shall also bring on record the role of the assessee in promoting the company and relationship of the assessee with other promoters, role of the assessee in inflating the price of shares, etc. as had been held by the Co-ordinate Bench of this Tribunal in the case of Shri Aravind Nandial Khatri Vs. I.T.O [2018 (12) TMI 1652 - ITAT CHENNAI]. Assessee’s appeal is treated as partly allowed for statistical purposes.
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2020 (3) TMI 1293
Maintainability of application - initiation of CIRP - Corporate Debtor committed default in payment of outstanding debt - it is argued that it was not a case simply of outstanding amount only on account of lease rent but amount of electricity charges, diesel, sewer and water charges were also due - Operational debt or not - existence of debt and dispute or not - HELD THAT:- Admittedly, in the present case, there are dues of electricity, diesel, sewer and water charges which are undisputed by the Corporate Debtor. The quantum of such claim/debt is also more than ₹ 1 Lac. Diesel has been consumed for providing electricity. Electricity charges are to be reimbursed by the Corporate Debtor based upon its consumption. Similarly, water charges are also to be paid. These activities clearly fall in the definition of provisions of Services as defined in Section 5(21) of IBC, 2016 as the definition in Section 5(21) means a claim in respect of the provision of Services - the contention of the Corporate Debtor that since main services cannot be categorized as operational debt, these will also not construe as operational debt, is rejected - further, no such restriction/condition exists in provisions of Section 5(21) of IBC, 2016, hence, for this reason also, we see no merit in this contention of the Corporate Debtor.
Notice u/s 8 of IBC, 2016 has duly been served and acknowledged. The application is otherwise complete and defect-free - application filed by the Operational Creditor under section 9 of the Insolvency & Bankruptcy Code, 2016 for initiating Corporate Insolvency Resolution Process against the Corporate Debtor, Web Date Systems Private Limited, is hereby admitted - moratorium declared.
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2020 (3) TMI 1292
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - service of notice - service of notice - the Corporate Debtor claimed that the Notice period was required to be of two months and the Operational Creditor served only 1 month 5 days period and that Corporate Debtor was not liable to make payments as claimed - HELD THAT:- The record shows that the Operational Creditor had earlier sent a Notice under section 8 of IBC on 26th March, 2018 (Annexure A-8) and the Corporate Debtor had raised similar disputes in Reply dated 24th April, 2018 (Annexure A-9). Various disputes had been raised already till 24th April, 2018. The Operational Creditor gave up the earlier Notice sent under section 8 and on 26th March, 2018, the Operational Creditor sent yet another Notice under section 8 of IBC on 12th November, 2018 (Annexure A-10) and on basis of that Notice filed Application under section 9 before the Adjudicating Authority. Reason stated in the synopsis of that Application for not acting on the earlier Notice, was that the Operational Creditor is a person with limited means.
The Application under section 9 of IBC based on Notice under section 8 dated 12th November, 2018 was thus instituted. There is more than sufficient record that there were pre-existing disputes regarding handing over of the charge and the entitlements before the Notice dated 12-11-2018 was sent. The learned Counsel for the Appellant has pointed out Leave Policy (Page - 68 of the Appeal) to say that the employee is not allowed to use balance unutilised leave while serving the Notice period. Disputes were raised even regarding performance incentive. The Appellant himself in the Notice (Annexure A-10) dated 12th November, 2018 stated that the Annual Performance Incentive was due on 10th May, 2017. He having resigned by Notice dated 11th March, 2017 and admittedly stopped attending after 15th April, 2017, has claimed ₹ 6 Lakhs against this head, without showing that the performance was found to be up to the mark. These are service disputes and we cannot enter into settling these disputes.
The record shows that there were pre-existing disputes between the parties when Notice (Annexure A-10) was sent and Application under section 9 of IBC was filed. In this view of the matter, the Application under section 9 should not have been admitted as the disputes are service disputes which do not appear to be mere bluster.
The Application under section 9 of IBC filed by Respondent No. 1 - Operational Creditor before the Adjudicating Authority is dismissed.
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2020 (3) TMI 1291
Levy of Interest for delay in delivery of goods - delivery of goods is taxable under Section 9 of CGST Act, 2017 or HGST Act, 2017 or exempt under Section 11 of CGST Act, 2017 or HGST Act, 2017 - HSN Code - HELD THAT:- On perusal of Para 5 (e) of Schedule II of Central Goods and Services Act 2017; it is observed that for an activity to be supply of service there must be an agreement; that there must be benefit and obligation; that there must be a toleration of act - As submitted by the applicant (a) there is a written contract between the applicant and the rice millers; (b) the rice miller is availing benefit of enhanced period for the delivery of milled rice and it had an obligation under contract to provide the milled goods within specified period and to pay interest in case of delay in delivery of goods and (c) the applicant is tolerating an act of delay in delivery of milled rice by the rice millers and is charging interest (holding charges) on the same and not taking any legal recourse for the specific performance of the contract.
The interest charged by the applicant for delay in delivery of milled rice as per the time prescribed in the contract is a supply of service under Para 5 (e) of Schedule II of Central Goods and Services Act 2017 - service “agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act” falls under the HSN Classification 9794 and is a taxable supply.
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2020 (3) TMI 1290
Filing of Appeals/ cases - seeking continuation of interim direction / stay order passed in all competition Appeals - complete lockdown situation on the spread of pandemic novel CORONAVIRUS disease - HELD THAT:- Upon requests for urgent listing of cases having been made telephonically to Registrar of this Appellate Tribunal from various persons, who were unable to physically file the same on account of complete lockdown declared by Government with effect from 25th March, 2020, we take suo moto cognizance of the unprecedented situation arising out of spread of COVID19 virus declared a pandemic. Having regard to the hardships being faced by various stakeholders as also the legal fraternity, which go beyond filing of Appeals/ cases, which has already been taken care of by the Hon’ble Apex Court by extending the period of limitation with effect from 15th March, 2020 till further order/s in terms of order IN RE : COGNIZANCE FOR EXTENSION OF LIMITATION [2020 (5) TMI 418 - SC ORDER] inasmuch as certain steps required to be taken by various Authorities or to comply with the various provisions under the Competition Act, 2002, this Appellate Tribunal do hereby order as follows: -
(1) That interim direction / stay order passed in all competition Appeals shall continue until further order.
(2) In the event of expiry of period of Fixed Deposits, the concerned bank shall renew the same for further period of six months.
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2020 (3) TMI 1289
Stay petition Rejected - petitioner's grievance is that the Principal Commissioner of Income-tax has rejected the petitioner's application for stay without the minimum deposit of 20% ignoring Instruction No. 1914 and the subsequent Official Memorandum/Circular dated February 29, 2016 - HELD THAT:- It is incumbent on the Principal Commissioner of Income-tax to decide on the application for stay considering two questions, viz., whether the assessment is unreasonably high-pitched and whether the petitioner would be put to genuine hardship because of such assessment. However, in the present case, the Principal Commissioner's order is a non-speaking order without considering either the question of high-pitched assessment or the genuine hardship to the petitioner. Therefore, the impugned order will have to be quashed on this limited ground and the petitioner's application restored/ remanded for reconsideration.
As the respondents submits that if the petitioner were to appear before the Principal Commissioner of Income-tax, Hubbali, on March 19, 2020, the petitioner will be heard afresh on the merits of its application for stay and exemption from deposit of the minimum of 20 per cent. of the demand.
Writ petition is partly allowed quashing the order dated February 26, 2020 restoring the petitioner's application for stay for reconsideration in accordance with the decision of this court in Flipkart India's case [2017 (3) TMI 802 - KARNATAKA HIGH COURT] requiring the petitioner to appear before the Principal Commissioner of Income-tax, Hubballi, on March 19, 2020 without further notice.
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2020 (3) TMI 1288
Notice of eviction for attaching the properties - section 26 of Prevention of Money Laundering Act, 2002 - Case of respondent is that no doubt law gives the petitioners period of 45 days but they cannot be permitted to create third party interest in the subject matter - HELD THAT:- The interest of justice can be met with by directing respondent not to implement the notice of eviction for period of 55 days from 18/2/2020 that is the date of service of the order of confirmation of attachment - Petitioners shall however in the meanwhile not create third party interest and shall not encumber the said property.
Petition disposed off.
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2020 (3) TMI 1287
Maintainability of application - initiation of CIRP - Corporate Debtor unable to liquidate its debt - default in payment of lease rent - operational debt or financial debt - pre-existing dispute or not - HELD THAT:- It is admitted facts that the Operational Creditor claim the amount, on the basis of lease agreement and defaulted amount, according to the Operational Creditor is the rent, which the Corporate Debtor fails to pay within the time fixed as per the lease agreement, we further find, after receiving the copy of the application as well as the demand notice, the Corporate Debtor raised the similar question, which have been formulated by the Hon'ble NCLAT, in that appeal and claimed amount does not come under the definition of operational debt and there is a pre-existence disputes.
In the present case, the Operational Creditor claimed the lease rent as an operational debt, which does not come under the definition of operational debt. At this juncture, we would also like to refer that there is existence of dispute, as it was admitted by the operational Creditor that before the issuance of the demand notice, the corporate debtor has communicated that a notice was issued by the MCD regarding the commercial use of the building and it has also been decided by the MCD, therefore, in our considered view, the dispute has been raised by the corporate debtor prior to the receiving of the demand notice, therefore, in view of Section 9(5)(2) of the Code, if the notice of dispute is raised regarding existence of dispute within 10 days of the receipt of the demand notice and the record shows that there is a existence of dispute in that case the application is not maintainable.
Since the lease rent does not come under the definition of the operational debt and there is pre-existence of dispute, therefore, the present application is not maintainable and same is liable to be dismissed.
Application dismissed.
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