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Showing 181 to 200 of 1905 Records
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2019 (8) TMI 1726 - ITAT MUMBAI
Disallowance on account of staff welfare expenses, conveyance expenses, general expenses and office maintenance expenses - CIT(A) held these disallowances @ 10% to be reasonable for the reason that all these expenses were booked on the basis of self made vouchers and payments were made in cash - HELD THAT:- The authorities below have made adhoc disallowances of expenses incurred under the various heads to the extent of 10% of the total claim of the assessee. The only reasons attributed by the authorities are that these expenses were incurred in cash and booked on the basis of self made vouchers. In our opinion, the disallowance was purely made on the basis of presumptions and surmises and adhoc in nature without pinpointing any specific defects or deficiencies. Therefore , we deem it fit to restrict the disallowance to 5%. Appeal of the assessee is partly allowed.
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2019 (8) TMI 1725 - ITAT MUMBAI
TP Adjustment - comparable selection - functional similarity - HELD THAT:- R. Systems International Ltd comparable has been rejected only on the ground that it follows different accounting period and learned DRP has observed that such comparable has to be excluded as the result cannot be compared with degree of accuracy as quarterly audited results are not available. Now it is the contention of learned counsel that the details required in this case pertaining to 1.4.2013 to 31.3.2014 are now available and these data can be used and result can be extrapolated. The case laws referred by learned counsel in this regard also support the proposition that this comparable can be accepted as comparable on the facts of this case - we accede to the request of learned counsel to remand back the issue to the TPO to include R. Systems International Ltd. in the final list of comparables and consider in the light of now available quarterly results from 1.4.2013 to 31.3.2014.
Excel Infoways Ltd - We find ourselves in agreement with the submission of learned Counsel of the assessee. As evident from the submissions, the said comparable has hugely fluctuating margin also. Its revenue is declining in to a great extent. Furthermore, assessee’s plea is that the comparable has unreliable employees cost. That there is no separate segment for ITeS. That the company has diversified into new areas such as construction and development of property. These distinguishing features show that this entity is not a good comparable in the present case. This proposition is also supported by the case laws referred by learned counsel as above.
As regards the issue of corporate support services, we accede to the request of the learned Counsel of the assessee and direct that R. Systems International Ltd. be included as comparable in terms of our direction as above and Excel Infoways Ltd. should be rejected.
Transfer pricing adjustment in respect of research and development of the assessee has confined the argument that the assessee’s grievance will be addressed by excluding selection of Syngene International Ltd. as comparable. It is the claim of the assessee that Syngene International Ltd. is engaged in different business activity. That it is engaged in contract research and manufacturing services. That its segmental information is not available. Hence, results of research and manufacturing activities cannot be separately identified and compared. Learned counsel has also placed reliance upon the case laws where it has been agreed that in the absence of segmental analysis, this is not a good comparable. Accordingly, we accept the contention of learned counsel and direct that Syngene International Ltd. should be taken out of comparable. The TPO shall make computation afresh accordingly after giving the assessee proper opportunity of being heard.
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2019 (8) TMI 1724 - ITAT MUMBAI
Reopening of assessment u/s 147 - Bogus purchases addition - HELD THAT:- In this case, the assessment was framed u/s.143(3) of the Act vide order dt.31-10-2011. We note that during the original assessment proceedings, the AO specifically raised a query vide letter dt.08-09-2011 in para 2, directing the assessee to furnish the sales and purchases, which was replied by assessee vide letter dt.18-10-2011, giving party-wise sales and purchases.
All the Hawala parties qua which the reopening proceedings were resorted to u/s.147 r.w.s.148 of the Act were originally furnished before the AO and thus, the reopening is done on the basis of same materials in respect of the same parties, which were examined by the AO by calling for specific details from the assessee. In our opinion the case of assessee was reopened on the change of opinion only as all the parties were verified by the AO during the course of original assessment proceedings.
This is a mere change of opinion by the AO, which is not permissible under the Act. The case of assessee is squarely covered by the decision of CIT V. Kelvinator of India Ltd.[2010 (1) TMI 11 - SUPREME COURT] - Appeal of assessee is allowed.
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2019 (8) TMI 1723 - ITAT MUMBAI
Income accrued in India - Reimbursement of rebate and discount in nature of Royalty - as per AO reimbursement of rebate and discount received by the Appellant from Braitrim India Private Limited ('BIPL') is for the use of the brand 'Braitrim' and is assessable to tax as 'Royalty' under section 9(1)(vi) of the Act/Article 13 of the India-United Kingdom tax treaty - HELD THAT:- We find that the assessee is required to give a rebate/discount to the retailers based on the volume/units of sales to garment suppliers achieved by the Braitrim group. Subsequently, the proportionate share of rebate/discount is recovered by the assessee from its group companies, including BIPL, based on the relative sales of those group companies to the respective retailers. The assessee has, accordingly entered into a reimbursement agreement with BIPL, whereby BIPL has acknowledged its obligation to reimburse its proportionate share of the discount/rebate to the assessee based on sale volumes/units achieved by it. As per the Cost Reimbursement Agreement (CRA), such reimbursements are depicted as 'Administration charges' by BIPL in its books of account.
Quite clearly, payments by way of reimbursement of expenses incurred on behalf of the payer cannot be construed as income chargeable to tax in the hands of the payee, a proposition which is approved by the Hon'ble Bombay High Court in the case of Siemens Aktiongesellschaft [2008 (11) TMI 74 - BOMBAY HIGH COURT]. In view of the above discussion, we direct the Assessing Officer not to treat any part of reimbursement of expenses received by the assessee as income of the assessee. The assessee gets the relief accordingly on Ground no. 2 of the aforesaid appeal.
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2019 (8) TMI 1722 - CALCUTTA HIGH COURT
Validity of Master’s Circular of wilful defaulters - Account classified as wilful default or not - HELD THAT:- There are procedural irregularities in the bank arriving at the decision to classify the account as a wilful default - In the facts of the present case, it would be appropriate to permit the bank to initiate proceedings under the Master’s Circular for wilful defaulters in respect of the subject account, in accordance with law. No doubt, the bank will communicate the decision of the identification committee to the persons responsible, in accordance with law.
Petition disposed off.
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2019 (8) TMI 1721 - NATIONAL COMPANY LAW TRIBUNAL, NEW DELHI
Rejection of claim of allottees/joint allottees - claims were rejected by the Resolution Professional on the ground of delay - it is stated that the delay in filing of claims is not intentional and many applicants were unaware of the CIRP and filing of claims - HELD THAT:- The RP is directed to accept claims and adjudicate the same as per law - application disposed off.
Mr. Mewa Singh and Mr. Vineet Kr. Girotra are present in person and submit that they have not filed any objections or any application which is pending before this Bench. They request that they should exempted from appearing personally. Their presence is dispensed with.
All the pending applications are listed for 29.08.2019.
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2019 (8) TMI 1720 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI
Validity of demand notice - seeking assignment and allocation of 100% of the Sale Proceeds/Oil and Gas Invoices in favour of Government - recovery of provisional sum towards the unpaid Government share of Profit Petroleum - HELD THAT:- As per procedure the amount in question has been deposited with the ‘Videocon Industries Limited (Corporate Debtor) in the light of the ‘Joint Operation Agreement’ and ‘Production Sharing Contract’ - It is true that the demand notice has no relevancy with the award and the ‘Resolution Professional’ cannot rely on the award for the purpose of deciding whether it is payable to the Union of India or not, during the ‘Corporate Insolvency Resolution Process’.
The Adjudicating Authority rightly held that it was concern about the enforcement of the provision of Section 14 of the I&B Code as per which after declaration of ‘Moratorium’ prohibition is enforced from recovery of any amount from the ‘Corporate Debtor. Prohibition is also towards institution of any suit or execution of any judgment, decree or order of any court of law, Tribunal, Arbitration Panel etc. once the order of ‘Moratorium’ is passed. However, it is open to the ‘Corporate Debtor’ to recover any amount as per law and award, if any, passed in its favour - The Adjudicating Authority rightly held that the Ministry of Petroleum can lodge its claim for any legally enforceable right of recovery through ‘Resolution Professional’, thereby not rendered it remediless. ‘Chennai Petroleum Corporation Ltd.’; ‘Mangalore Refinery and Petrochemicals Limited’; ‘GAIL (India) Limited’ and ‘Bharat Petroleum Corporation Ltd.’ have been rightly restrained from remitting the amount from the sale proceeds to the Union of India, which are due to the ‘Corporate Debtor’ during the pendency of the ‘Moratorium’.
Appeal dismissed.
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2019 (8) TMI 1719 - KARNATAKA HIGH COURT
Dishonor of Cheque - error in acquitting the accused on the basis of the complainant not showing the source of income - HELD THAT:- On perusal of these admissions by the complainant goes to show that, except the oral evidence in respect of lending ₹ 1,00,000/- to the accused, there is no other document obtained by him. Further, the complainant being the income tax assessee, he has not declared lending of ₹ 1,00,000/- to the accused in his income tax returns. Further, in the cross-examination, he has admitted that he cannot say on which date he gave the money to the accused, but he says only in the month of April. He further admitted in the cross-examination that the accused gave the cheque to him on 21st or 22nd November, 2008, whereas Ex. P2-cheque shows the date as 20.10.2008, which falsifies the evidence on record. When the cheque has been issued on 21st or 22nd of November, 2008, the question of mentioning the date as October, 2008 does not arise.
There is no document forthcoming from the side of the complainant to show that he had source of income and capacity to lend ₹ 1,00,000/- to the accused and he being the income tax assessee, not declared the said income to the Income Tax Authority and no documents were produced in the Court. Apart from that, he has not produced any document to show that he had cash in his possession to lend the same to the accused. Therefore, the contention of the complainant that the accused borrowed the amount and he was unable to pay the amount is not acceptable.
In the case on hand, though the presumption under Section 118 R/w. Section 139 of the Negotiable Instruments Act exists in favour of the complainant, however, the accused is required to rebut the presumption available in favour of the complainant. The accused need not enter into witness box by letting evidence, but he can rebut the evidence of the complainant in the cross-examination. In this case, the accused is disproved the evidence of PW1 in respect of the existence of presumption in favour of the appellant/complainant and legally recoverable debt payable by the accused - when the accused/complainant himself is unable to show the source of income and capacity to pay and date of issuance of cheque throw suspicion and cloud in the evidence of the complainant. It is not possible to accept the evidence of the complainant that there is any legally recoverable debt payable by the accused and he had issued the cheque to discharge the amount to the complainant.
The contention of the complainant that he has actually lent the loan and in discharge of the said loan the accused issued the cheque to discharge the legally recoverable debt cannot be acceptable - The first Appellate Court has rightly re-appreciated the evidence on record and accepted the contention of the accused and acquitted the accused, whereas the trial Court has not considered those aspects in proper perspective.
The appeal filed by the complainant is hereby dismissed.
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2019 (8) TMI 1718 - RAJASTHAN HIGH COURT
Principle of parity and comity of court - vires of Section 3 of the Foreign Trade (Development and Regulation) Act, 1992 - HELD THAT:- The notification dated 29.3.2019 having been issued by the Central Government, prima facie there can be no doubt about it being intra vires Section 3 of the Foreign Trade (Development and Regulation) Act, 1992. However to the extent, the said notification is being made operative retrospectively it prima facie cannot be and it would be directed that in the interim it operate qua the petitioner only prospectively. However the order dated 16.4.2019 issued by the Directorate General of Foreign Trade to the extent it seeks to modify the Central Government’s notification dated 29.3.2019 in the garb of purported clarification shall remain stayed.
A copy of the petition be served on Mr. Siddharth Rank and Mr. Anand Sharma. Their names be shown in the cause list.
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2019 (8) TMI 1717 - ITAT BANGALORE
Exemption u/s 11 - Applicability of the registration granted to a trust or institution to earlier years - Non-application of registration for the period prior to the year of registration caused genuine hardship to charitable organisations - claim of the assessee that since the registration of the assessee concern has been granted w.e.f. 21.09.2016, it comes into effect during the course of pendency of first appeal proceedings and the proviso to sub-section 2 of section 12A should be construed liberally and the assessee should be granted exemption u/s. 12A - HELD THAT:- As relying on M/S SHREE SHYAM MANDIR [2017 (10) TMI 1450 - RAJASTHAN HIGH COURT] registration was granted to the assessee u/s. 12AA of the IT Act on 29.07.2013. Under these facts, it was held by Hon’ble Rajasthan High Court that appeal is continuation of original assessment proceedings and proceedings before appellate authorities is covered by the proviso to subsection 2 of section 12A of the IT Act. In the present case also, the facts are similar and hence, respectfully following this judgment of Hon’ble Rajasthan High Court, we decline to interfere in the order of ld. CIT(A). Appeal filed by the revenue is dismissed.
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2019 (8) TMI 1716 - CESTAT CHENNAI
Refund claim of the pre-deposit paid in excess - excess pre-deposit was made by mistake - HELD THAT:- Admittedly, the appellant is not claiming refund of any part of the amount it paid during the investigation which is shown to have been appropriated, but is only claiming refund of the excess pre-deposit made by mistake while filing its first appeal; it would have been different if no such amounts were paid during investigation.
The purpose of pre-deposit has been satisfactorily met by the appellant and hence, in view of the specific facts of the case, the appellant should get back the excess pre-deposit made by mistake - When the legislature makes it clear what is to be collected as pre- deposit, in the absence of any finding with regard to the non-satisfaction of such conditions as to the pre-deposit, the Revenue cannot retain such excess amount remitted by mistake.
Appeal allowed - decided in favor of appellant.
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2019 (8) TMI 1715 - ITAT JAIPUR
Maintainability of appeal - low tax effect - HELD THAT:- We note that the tax effect in this appeal is not exceeding the monetary limit as revised by the CBDT vide Circular dated 08.08.2019 for the purpose of filing of appeal by the department before the Income Tax Appellate Tribunal from ₹ 20,00,000/- to ₹ 50,00,000/-
Accordingly, the appeal of the department is not maintainable being monetary limit is less than/not exceeding ₹ 50,00,000/-.
The department is at liberty to file the Miscellaneous Application in case the tax effect in this appeal is found to be more then ₹ 50,00,000/- or the case falls in any of the exceptions of the circular.
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2019 (8) TMI 1714 - NATIONAL COMPANY LAW TRIBUNAL, KOLKATA
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - HELD THAT:- Where Corporate Debtor has obtained a loan having time value of money or on interest, enjoyed it on the basis of subject MOU, it is both a legal and equitable obligation of a Corporate Debtor and, simultaneously, legal and equitable right of the Financial Creditor to initiate CIR process under IBC 2016 in case of default by the Corporate Debtor in repayment thereof - the admitted facts need not be proved and when it is so that is, when proof of document is not required, then, there is no need to revisit the validity of document bypassing the admission already made by the opposite party. The Corporate Debtor has admitted the fact of loan, rate of interest payable by the Corporate Debtor thereon and also default committed by the Corporate Debtor in repayment of impugned loan in its audited financial statements, hence, there is no need to look into the aspect of nature of MOU or its enforcement due to insufficiency of stamp duty.
There are no merit that person authorized to file this petition was not having requisite authority as the Board resolution authorizing the person mentions that such person can file a petition before NCLT, being an adjudicating authority, for matters arising under IBC 2016 - petition admitted.
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2019 (8) TMI 1713 - NATIONAL COMPANY LAW TRIBUNAL — HYDERABAD BENCH
Maintainability of application - Initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors or not - Financial debt - existence of debt and dispute or not - Whether the subordination agreement has to be taken into consideration or not to decide the matter? - HELD THAT:- In the present case, the loan was provided as unsecured loan and there is no interest and no time is fixed to repay the same. Even in the financial statements for financial year 2015-16 and financial year 2016-17 of the corporate debtor, relied upon by the petitioners to support their claim, do not reflect any provision for interest against unsecured loans given by the petitioners. Therefore, the said loan does not have consideration for time value of money and will not come under the category of financial debt. Consequently, the petitioners will not fall under the category of financial creditors as defined in the IB Code, 2016. Further, there is no default as per the provisions of the I and B Code, 2016, in absence of any agreement with regard to the repayment period of the said unsecured loans.
The unsecured loan provided by the petitioners in the present case will not fall under the category of financial debt. It is also proved that the debt has not become due and same is not payable at this point of time as the petitioners are also parties to the subordination agreement and the clauses are binding on them. Therefore, the petitioners cannot be treated as the financial creditors.
Petition cannot be admitted.
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2019 (8) TMI 1712 - SUPREME COURT
Initiation of liquidation of the Corporate Debtor - absence of approved Resolution Plan - HELD THAT:- The appeal is allowed.
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2019 (8) TMI 1711 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI
Validity of Resolution plan - Withdrawal of CIRP application filed under Section 9 - 90% voting shares of the ‘Committee of Creditors’ were received for approval (of withdrawal) - HELD THAT:- The Allottees (Home Buyers) are also Members of the ‘Committee of Creditors’, therefore, while calling meeting of the ‘Committee of Creditors’, they should also be called for voting in accordance with the existing provisions of law. In that view of the matter, it is the ‘Resolution Professional’ to place the proposal of Appellant/ Promoters before the ‘Committee of Creditors’. If necessary, the date of meeting of the ‘Committee of Creditors’ be fixed in the manner as prescribed under the Regulations and information be given to the ‘Financial Creditors’ including the allottees to take part - The ‘Committee of Creditors’ will consider the same taking into consideration the interest of the Allottees and will also take into consideration the viability and feasibility of the proposal.
Bank Guarantee - HELD THAT:- It is clear that if the ‘Committee of Creditors’ approves the proposal with 90% voting shares, it may also ask the Promoters to give Bank Guarantee, as it may propose, failing which the Applicant, who has filed the application under Section 9, may not make prayer for withdrawal of the application.
Place the case ‘for orders’ on 4th September, 2019.
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2019 (8) TMI 1710 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI
Seeking reversal of the amounts debited from the account of the ‘Corporate Debtor’ maintained with the ‘ICICI Bank Limited’ before the ‘insolvency commencement date’ - main plea taken by the Appellant, ICICI Bank is that the ‘Resolution Professional’ before filing an application under Section 43(1) of the I&B Code formed no opinion independently nor afforded an opportunity to the Appellant to explain about the transactions in question - HELD THAT:- Sub-section (3) (a) of Section 43 of the ‘I&B Code’ makes it clear that ‘preferential transaction’ does not include transfer made in the ordinary course of the business or financial affairs of the ‘Corporate Debtor’ or the transferee - As per sub-section (4) of Section 43 of the ‘I&B Code’ preference shall be deemed to be given at a relevant time, if it is given to a related party during the period of 2 years preceding the insolvency commencement date; or a preference is given to a person other than a related party during the period of one year preceding the insolvency commencement date.
In the present case, the transactions were made by the Appellant Bank on 8th December, 2017, 11th December, 2017 and 14th December, 2017, as per ‘Renewal Credit Arrangement Letter’ letter dated 20th January, 2017 which was valid up to 16th December, 2017 - Admittedly, the Appellant Bank is not a related party and, therefore, for the purpose of relevant time clause (b) of sub-section (4) of Section 43 of the I&B Code can be said to be applicable i.e. period of one year of ‘insolvency commencement date’.
The application under Section 7 was admitted on 8th December, 2017 and the ‘Resolution Professional’ was appointed on the said date. The order was passed on 8th December, 2017 and was pronounced on 15th December, 2017, and uploaded in the website - In the present case the application under Section 7 of the ‘I&B Code’ was admitted on 8th December, 2017 and the ‘Interim Resolution Professional’ was appointed on the same date. Therefore, the ‘corporate insolvency resolution process’ commenced on 8th December, 2017.
The Adjudicating Authority has failed to notice the fact that all the transactions were made on or after the date of commencement of the ‘corporate insolvency resolution process’ and in ordinary course of business and in view of such position the impugned order dated 12th March, 2019 cannot be upheld - appeal allowed - decided in favor of appellant.
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2019 (8) TMI 1709 - CESTAT AHMEDABAD
Extended period of limitation - SCN was issued for the period 2002-03 to 2006-07 on 15.03.2007 - the SCN was time-barred or not - suppression of facts or not - clearances in bulk instead of clearances on retail pack - HELD THAT:- Even though there is unambiguous Chapter Note in Chapter 24, the appellant have intentionally devised a method whereby first they have cleared bulk snuff of tobacco captively and issued invoices and paid the duty thereon, thereafter the same goods were re-packed for retail pack in their own factory and issued commercial invoices on higher value, thereby they suppressed the value of the finished goods cleared from the factory. In their ER-1 return, they have not declared the correct clearance value of retail pack whereas they have declared in the ER-1 return only the bulk snuff of tobacco and its value to mislead the department that they have declared the goods in bulk form only. With this modus operandi, the department could not know about their activity of payment of duty on the bulk and removal of goods in the retail form, therefore, there is a clear suppression of fact and mis-declaration on the part of the appellant.
The extended period was rightly invoked in the facts of the present case - the impugned order is upheld on merit as well as limitation - Appeal dismissed.
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2019 (8) TMI 1708 - ITAT MUMBAI
Nature of expenditure - stamp duty and service fees - revenue or capital expenditure - CIT(A) allowed the expenditure incurred on stamp duty paid for availing various loans and legal expenses/ services fee as business expenditure - AO’s main contention for disallowance is that first this is a capital expenditure, reason being the loan is taken for the purpose of acquiring capital asset and hence, stamp duty paid, registration fee paid and lawyer’s fee paid is capital expenditure - HELD THAT:- Assessee is able to prove that these expenses were routine expenses incurred by the assessee during the course of business for the reason that on account of these loans no capital asset has been created by incurring such expenditure.
We noted that even Hon’ble Supreme Court in the case of India Cement Ltd.[1965 (12) TMI 22 - SUPREME COURT] held that the stamp duty, registration fee, lawyers fee etc., paid for obtaining loan was eligible for business expenditure. We noted that the aforesaid amounts were reflected in the schedule 12 of the balance sheet in the Revenue’s account as interest and finance charges.
Also the assessee has suo moto capitalize the expenses which were to be capitalized as is evident from Schedule 13 of the balance sheet, which is in Revenue’s account. We noted from the copies of the agreement that these expenses were incurred on stamp duty, service fee, lawyer’s fee being legal expenses for filing various loan and services for trusteeship of MSE bonds. In view of the above, we are of the view that the CIT(A) has rightly allowed the claim of the assessee of these expenses as business expenditure under section 37(1) of the Act and hence, we do not want to interfere in the same. This issue of Revenue’s appeal is dismissed.
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2019 (8) TMI 1707 - NATIONAL COMPANY LAW TRIBUNAL, CHENNAI
Approval of Resolution Plan - Extinguishment of all liabilities - termination/abatement of all pending proceedings - all liabilities and debt of PRC as admitted by the RP to be paid as provided for in this proposed Resolution Plan - discharge PRC of all liabilities including contingent liabilities - vesting of all licenses - grant of benefit of carry forward and set-off losses under applicable sections of the Income Tax act 1961 - HELD THAT:- The Resolution Plan filed with the Application meets the requirements of Section 30(2) of I&B Code, 2016 and Regulations 37, 38, 38(1A) and 39 (4) of IBBI (CIRP) Regulations, 2016. The Resolution Plan is also not in contravention of any of the provisions of Section 29A. The Resolution Professional has also certified that the "Resolution Plan" approved by the CoCs does not contravene any of the provisions of the law for the time being in force - The Resolution Professional has also filed Compliance Certificate in Form H as required under Regulation 39(4) of IBBI (Insolvency Process for Corporate persons) Regulations, 2016.
The Resolution Plan annexed with MA/651/2019 filed in CP/540/IB/2018 is hereby approved, which shall be binding on the Corporate Debtor and its employees, members, creditors, guarantors, other stakeholders including statutory authorities involved in the Resolution Plan and the Resolution Applicant - While approving the Resolution Plan, as mentioned above, it is clarified that the Resolution Applicant shall pursuant to the Resolution Plan approved under Sub-section (1) of Section 31 of the I&B Code, 2016, obtain all the necessary approval as may be required under any law for the time being in force within a period of one year from the date of approval of the Resolution Plan by this authority or within such period as provided for in such law.
Resolution plan approved - moratorium shall cease to have effect from the date of passing of this Order.
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