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Showing 21 to 40 of 1320 Records
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2021 (1) TMI 1302 - ALLAHABAD HIGH COURT
Cognizance/summoning order u/s 276C (2) r.w.s. 278E of I.T.Act - application u/s 482 Cr.P.C praying to quash the Criminal Complaint - HELD THAT:- As applicant submits that he does not want to press the principal prayers made in this application. He is ready to submit to the jurisdiction of the court, seek bail and accept all the conditions which this Court may deem fit to impose upon him. The only prayer made by learned counsel for the applicant is for expeditious disposal of his bail application.
In view of the submissions made by learned counsel for the applicant, the prayer, so far as it relates to seeking quashing of the proceedings as well as summoning order, stands refused.
However, it is directed that if the applicant appears and surrenders before the court below within 30 days from today and applies for bail, his prayer for bail shall be considered and decided in view of the settled law laid by this Court in the case of Amrawati and another Vs. State of U.P. [2004 (10) TMI 635 - ALLAHABAD HIGH COURT] as well as judgement passed by Hon'ble Apex Court reported in Lal Kamlendra Pratap Singh Vs. State of U.P. [2009 (3) TMI 1042 - SUPREME COURT]
For a period of 30 days from today, no coercive action shall be taken against the applicant. However, in case, the applicant does not appear before the Court below within the aforesaid period, coercive action shall be taken against him. Application under Section 482 Cr.P.C. is finally disposed of
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2021 (1) TMI 1301 - PUNJAB AND HARYANA HIGH COURT
Adjudication not finalised even after lapse of more than 10 years - Denial of CENVAT Credit - recovery of rebate claim - petitioner purchased their raw material from J & K based manufacturer who did not purchase any crude Mentha oil from the farmers - HELD THAT:- The present petition stands allowed in terms of decision in the case of SHREE BALAJI AROMATICS PVT. LTD., HINDUSTAN MINT AND AGRO PRODUCTS PVT. LTD. VERSUS COMMISSIONER, CENTRAL GOODS AND SERVICES TAX, CHANDIGARH. [2021 (1) TMI 1300 - PUNJAB AND HARYANA HIGH COURT], where it was held that The show cause notices having been issued long back more than a decade are not sustainable in the eyes of law, and thus, deserve to be quashed.
Petition allowed.
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2021 (1) TMI 1300 - PUNJAB AND HARYANA HIGH COURT
Adjudication not finalised even after lapse of more than 10 years - Denial of CENVAT Credit - recovery of rebate claim - petitioner purchased their raw material from J & K based manufacturer who did not purchase any crude Mentha oil from the farmers - HELD THAT:- The decision in the case of M/S MENTHA & ALLIED PRODUCTS LTD THROUGH ITS AUTHORISED REPRESENTATIVE SATYA NARAIAN VERSUS COMMISSIONER, CENTRAL GOODS & SERVICE TAX, CHANDIGARH AND M/S ARORA AROMATICS PVT. LTD. VERSUS UNION OF INDIA AND OTHERS [2020 (12) TMI 1230 - PUNJAB AND HARYANA HIGH COURT] would cover the case of the petitioners in their favour, where it was held that The show cause notices having been issued long back more than a decade are not sustainable in the eyes of law, and thus, deserve to be quashed.
Petition allowed.
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2021 (1) TMI 1299 - SUPREME COURT
Summon by Additional District Judge under Section 319 Cr.P.C. - concealment of not placing the order on record - HELD THAT:- The principles for exercise of power under Section 319 Cr.P.C. by Criminal Court are well settled. The Constitution Bench of this Court in Hardeep Singh versus State of Punjab and others, [2014 (1) TMI 1819 - SUPREME COURT], has elaborately considered all contours of Section 319 Cr.P.C. This Court has held that Power under Section 319 Cr.P.C. is a discretionary and extra-ordinary power which has to be exercised sparingly. This Court further held that the test that has to be applied is one which is more than prima facie case as exercised at the time of framing of charge, but short of satisfaction to an extent that the evidence, if goes unrebutted, would lead to conviction.
A perusal of the judgment of the High Court indicates that the High Court did not examine the correctness of the order dated 17.08.2019 by which the appellants were summoned by Additional District Judge under Section 319 Cr.P.C., rather has dismissed the Criminal Revision on basis of a subsequent fact i.e. order dated 18.09.2019 by which notice has been issued under Section 446 Cr.P.C. The High Court further took the view that since the proceedings in pursuance of Section 319 Cr.P.C. have already been initiated and that no simultaneous challenge to the impugned order dated 17.08.2019 summoning the revisionists under Section 319 Cr.P.C. would be tenable before the High Court till the order dated 18.09.2019 passed in proceedings at the behest of revisionist subsist.
The order dated 18.09.2019 by which the Court has directed appearance of the accused appellant is to be taken to its logical end but that order cannot provide a shield of protection to earlier order dated 17.08.2019 by which appellant has been summoned.
The impugned judgment of the High Court dated 27.09.2019 is unsustainable and deserves to be set aside - Appeal allowed.
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2021 (1) TMI 1298 - GUJARAT HIGH COURT
Exemption u/s 11 - denying the benefits of Section 11 and 12 by invoking proviso to Section 2(15) r.w.s. 13(8) - accumulation of 15% - deduction in the fixed assets - HELD THAT:- All the three questions, referred to above, as proposed by the Revenue are no longer res integra in view of the judgment of this High Court rendered [2020 (8) TMI 600 - GUJARAT HIGH COURT]
This tax appeal fails and is hereby dismissed.
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2021 (1) TMI 1297 - SUPREME COURT
Seeking grant of Anticipatory bail - disputes civil in nature - by imposing the condition of deposit of ₹ 41 lakhs, the High Court has, in an application for pre-arrest bail Under Section 438 of the Code of Criminal Procedure, 1973 virtually issued directions in the nature of recovery in a civil suit - HELD THAT:- It is well settled by a plethora of decisions of this Court that criminal proceedings are not for realization of disputed dues. It is open to a Court to grant or refuse the prayer for anticipatory bail, depending on the facts and circumstances of the particular case. The factors to be taken into consideration, while considering an application for bail are the nature of accusation and the severity of the punishment in the case of conviction and the nature of the materials relied upon by the prosecution; reasonable apprehension of tampering with the witnesses or apprehension of threat to the complainant or the witnesses; reasonable possibility of securing the presence of the accused at the time of trial or the likelihood of his abscondence; character behavior and standing of the accused and the circumstances which are peculiar of the accused and larger interest of the public or the State and similar other considerations.
A criminal court, exercising jurisdiction to grant bail/anticipatory bail, is not expected to act as a recovery agent to realise the dues of the complainant, and that too, without any trial.
The order impugned is modified by deleting the direction to deposit ₹ 41 lakhs as directed by the High Court - appeal disposed off.
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2021 (1) TMI 1296 - ITAT MUMBAI
Rate of tax applicable to domestic companies and/ or co-operative banks - provisions of Article 26 (Non-discrimination) of the India-France tax treaty - HELD THAT:- On a perusal of a recent order of the Tribunal passed in the assessee‟s own case for A.Y. 2013-14 [2019 (4) TMI 2099 - ITAT MUMBAI], we find, that the Tribunal by relying on its earlier order for A.Y. 1996-97 [2013 (8) TMI 1173 - ITAT MUMBAI] had therein concluded that the tax levied at a higher rate in the case of a foreign company is not to be regarded as a violation of the non-discrimination clause. Thus we respectfully follow the aforesaid order of the Tribunal. Accordingly, the Ground of appeal No. 1 is dismissed.
Data processing fees paid by Indian branch offices of the Appellant to its Singapore branch - HELD THAT:- As the facts in context of the aforesaid issue under consideration remains the same as was there before the Tribunal in the assessee‟s own case for A.Y. 2013-14 [2019 (4) TMI 2099 - ITAT MUMBAI] therefore, we respectfully follow the view therein taken. Accordingly, we herein direct the A.O to delete the impugned addition.
Income chargeable to tax - Interest payable/paid by the Indian branch offices of the Appellant to the head office and its other overseas branches - HELD THAT:- The issue as to whether or not interest payable/paid by the Indian branch offices of the assessee to its head office and its other overseas branches would be chargeable to tax had been looked into by the various benches of the Tribunal in the assessee‟s own case for the aforementioned years. On a perusal of the order passed by the Tribunal in the assessee‟s own case for A.Y. 2012-13 [2019 (7) TMI 1076 - ITAT MUMBAI] the Tribunal following the order in the case of Sumitomo Mitsui Banking Corporation [2012 (4) TMI 80 - ITAT MUMBAI] and the orders of the coordinate benches of the Tribunal in the assessee's own case for the preceding years, had concluded, that the interest income received by the assessee from its Indian branch being a payment made to self was thus not taxable in the hands of the assessee
Accordingly, we herein hold that the interest income received by the assessee from its Indian branch office being a payment made to self would not be taxable in the hands of the assessee.
Short credit of taxes deducted at source (TDS) - HELD THAT:- As the aforesaid issue would require verification of records, we, therefore, restore the matter to the file of the A.O with a direction to verify the aforesaid claim of the assessee. In case the claim of the assessee is found to be in order then credit for the deficit amount of tax deducted at source shall be allowed by the A.O as per the extant law. Needless to say, the A.O shall in the course of the “set aside” proceedings afford an opportunity of being heard to the assessee who shall remain at a liberty substantiate his aforesaid claim. The Ground of appeal No. 6 is allowed for statistical purposes.
Levying interest u/s 234A - return of income was filed by the Appellant within the prescribed due date for filing the return of income - HELD THAT:- We find that it is a matter of fact borne from the record that the assessee company had e-filed its return of income for the year under consideration i.e A.Y. 2014-15 vide e-filing acknowledgment No. 429259941291114. In the backdrop of the claim of the ld. A.R that the assessee had filed its return of income well within the prescribed time limit, therefore, no interest u/s 234A was liable to be saddled upon it, we herein restore the issue to the file of the A.O for making necessary verification. In case, the assessee is found to have filed its return of income within the stipulated time period contemplated in sub-section (1) to Sec. 139 then, no interest u/s 234A of the Act shall be imposed on it. Ground of appeal is allowed for statistical purposes.
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2021 (1) TMI 1295 - ITAT MUMBAI
Reopening of assessment u/s 147 - bogus purchases - AO had disallowed 12.5% of the alleged non-genuine purchases which has been sustained by Commissioner (Appeals) - HELD THAT:- The fact that the assessee failed to prove the genuineness of purchases before the Departmental Authorities is very much evident. Even, before the Tribunal the assessee had not filed any evidence to prove that purchases, indeed, were made from the declared source. In such circumstances the disallowance made by the Assessing Officer @ 12.5% of the non genuine purchases is reasonable considering the view expressed by the Tribunal in similar nature of cases. Therefore, we not inclined to interfere with the decision of learned Commissioner (Appeals) on the issue.
Validity of issuance of notice u/s 148 - As it is very much clear, initially the returns of income filed by the assessee were not subjected to scrutiny but were only processed u/s 143(1) - Subsequently, AO had received specific information indicating that certain purchases made by the assessee are non-genuine. Therefore, tangible material was available with the Assessing Officer to reopen the assessments u/s 147 of the Act. That being the case, there cannot be any question regarding assumption of jurisdiction u/s 147 of the Act. - Decided against assessee.
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2021 (1) TMI 1294 - ITAT DELHI
TP Adjustment - determining the arm’s length price of the appellant’s international transaction with its associated enterprises in respect of interest on loan advanced to wholly owned subsidiary thereby proposing an enhancement of returned income - computing interest at US LIBOR - HELD THAT:- We direct that transfer pricing adjustment qua the transaction of advancing loan by the taxpayer to its AE is to be determined at US LIBOR plus 170 basis points. Appeal of the assessee is allowed.
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2021 (1) TMI 1293 - SC ORDER
Condonation of delay of 166 days - Section 423 of the Companies Act 2013 - HELD THAT:- Under the provisions of Section 423, this Court is empowered to condone a delay (beyond the original period of limitation of 60 days) only to the extent of a further period of 60 days. Hence, since the appeal has been filed beyond the maximum period that can be condoned under the proviso to Section 423, the appeal cannot be entertained and is accordingly dismissed on the ground of limitation.
It only needs to be clarified that the order of the NCLAT, which had come to the conclusion that there was a violation of the principles of natural justice in adhering to the provisions of Section 272(4) of the Companies Act 2013, will not come in the way of the appellant taking recourse to the remedies available in law after following due process.
Application disposed off.
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2021 (1) TMI 1292 - MADHYA PRADESH HIGH COURT
Seeking grant of bail - offence of cheating and forgery - co-accused were running two investment companies in the name of Veliss Investment Solution and Goodwill Wealth Management Pvt. Ltd. and invited deposits by offering lucrative return of interest at the rate of 20% per month - HELD THAT:- As per the complainant he himself opened the Dmat account in the name of his wife and invested the money in anticipation of getting more returns than offered by the nationalized banks. He is an educated person and after understanding the scheme of the company he himself invested his money in the company, therefore, now he cannot say that he was not aware about the hidden risk and volatility of the money market. The applicant is in custody since 02.10.2020. The investigation is complete and Challan has been filed. All the documentary evidence has been seized by the police. The trial may likely to take time to conclude. The main accused Vinayak Nakaswal is already in custody. The applicant is also having parity with the case of co-accused who have already been enlarged on bail by this court.
The applicant is directed to be released on bail on her furnishing a personal bond in the sum of Rs.1,00,000/- with one solvent surety of the like amount to the satisfaction of the trial Court for her regular appearance before the trial Court during trial with a condition that she shall remain present before the Court concerned during trial and shall also abide by the conditions enumerated under section 437(3) Cr.P.C. - the application is allowed.
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2021 (1) TMI 1291 - ITAT BANGALORE
TP Adjustment - comparable selection - HELD THAT:- Assessee is engaged in providing information technology enabled services ("ITES") to its holding company and therefore has to be regarded as an Associated Enterprises ("AEs"), thus companies functionally dissimilar with that of assessee need to be deselected.
Also if filter of sales > Rs. 1 crore OR export turnover in excess of 75% of total sales is not satisfied exclusion of company as a comparable company confirmed. Also companies with huge brand value and diversified activities need to be deslected.
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2021 (1) TMI 1290 - ITAT PUNE
TP Adjustment - Comparable selection - inclusion of CTR Manufacturing Industries Ltd. - HELD THAT:- As assessee has shown the revenue operations up to 60% to 70% from the sale of capacitors and resistors whereas there was no segmental information about manufacturing as well as sale of capacitors and resistors in the annual statement of CTR Manufacturing Industries Ltd. Therefore, in our view CTR Manufacturing Industries Ltd. cannot be a comparable to that of assessee. Hence, it should be excluded from the comparables. Therefore, we direct the AO to exclude the CTR Manufacturing Industries Ltd. from the final list of comparables in the category of manufacturing segments.
I.T. Enabled Services/Back Office Support Services Segment - Comparability of certain companies in the Back Office Support Segment, this Tribunal remanded the matter to the file of AO/TPO to ascertain the precise nature of services rendered by the assessee under ITES and to examine the comparability or otherwise of the companies challenged in this segment in A.Y. 2010-11.In the light of the above, the AO is directed to ascertain the nature of services rendered by the assessee and examine the comparability of the companies indicated therein. Accordingly, this issue is remanded the file of AO/TPO for fresh examination. The assessee is liberty to file evidences, if any, in support of its claim.
TDS u/s 195 - Disallowance u/s. 40(a)(i) - assessee for convenience Vishay India hereafter paid an amount to its Associated Enterprise (AE) i.e. Vishay Intertechnology Asia Pte Ltd., Singapore - HELD THAT:- Tribunal in assessee’s own case for A.Y. 2012-13 [2019 (9) TMI 1683 - ITAT PUNE] wherein the issue on hand discussed by this Tribunal, wherein we note that the assessee availed similar services from its holding company in USA for which the Vishay Singapore paid the said amount on behalf of other entities situated worldwide and charged without no markup from the assessee as well as from other entities. No disallowance was made in this regard by the respondent authorities in the earlier years. The Tribunal examined the final assessment orders/TPO’s orders of earlier years along with the necessary documentation filed by the assessee therein and held the reimbursement of expenses for leaseline are not in the realm of royalty and section 9 of the Act or Article 12 of DTAA is attracted.
The Tribunal further placed reliance in the case of John Deere India Pvt. Ltd[2019 (3) TMI 458 - ITAT PUNE]wherein the similar issue was raised and held that the payment made for such leaseline charges was not royalty under DTAA and no obligation to deduct tax at source. Thus the disallowance as confirmed by the AO in accordance with the directions of DRP is not justified and accordingly, deleted. Thus, the assessee ground succeeds and it is allowed.
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2021 (1) TMI 1289 - ITAT DELHI
TP Adjustment - MAM Selection - AO rejecting the TNMM method applied by the assessee and used cup method for benchmarking the transaction of Intra Group Services (professional consultancy services and management fee for support services) - HELD THAT:- Following the orders passed by the coordinate Bench of the Tribunal in taxpayer’s own cases [2016 (8) TMI 950 - ITAT DELHI] and [2020 (8) TMI 917 - ITAT DELHI] and qua the controversy at hand in taxpayer’s own case, we are of the considered view that this issue is no longer res integra because time and again it has been held that TNMM is the MAM to benchmark the international transactions entered into by the taxpayer with its AE qua professional consultancy services (information technology) and fee for management support services but TPO, for the reasons best known to him and to our mind to generate unnecessary litigation, proceeded to apply the CUP method by applying same reasoning applied in the earlier years. So, ld. CIT (A) has rightly deleted the additions by following the orders passed by the Tribunal and Hon’ble Punjab & Haryana High Court [2019 (12) TMI 1630 - PUNJAB AND HARYANA HIGH COURT] passed in taxpayer’s own case. Consequently, the appeal filed by the Revenue is dismissed.
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2021 (1) TMI 1288 - SUPREME COURT
Seeking early hearing of appeal - HELD THAT:- Having regard to the fact that the matter has been pending before the learned Single Judge, we are of the view that it would be appropriate in the interest of justice, if the learned Single Judge is requested to dispose of the matter expeditiously preferably by the end of February, 2021.
The parties are at liberty to complete the pleadings within a period of two weeks from today - The learned Single Judge is requested to deal with the matter on day to day basis particularly having regard to allegedly large amount which is being taken by one of the parties without any account.
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2021 (1) TMI 1287 - AUTHORITY FOR ADVANCE RULING, CHHATTISGARH
Levy of GST - GTA Services - diesel filled free of cost by the service recipient in the engaged chartered (dedicated) vehicles, would form part of value of supply of service charged by the applicant or not - HELD THAT:- The applicant in the instant case is required to provide trucks / trailers on a day to day basis along with the driver and report at the unit of the service recipient and the fuel for providing such service has been kept within the scope of the service recipient and not in the scope of work of the applicant. Thereafter the applicant will be issuing consignment note /bilty for each vehicle load / consignment. As per Notification No. 11/2017-Central Tax (Rate) dated 28th June, 2017, “goods transport agency” or GTA means any person who provides service in relation to transport of goods by road and issues consignment note, by whatever name called.
There can be no dispute whatsoever: as regards the fact that fuel forms the single most important factor in rendering Goods Transport Service by a GTA and to visualize a Goods Transport Agency providing Goods Transport service without having any obligation or responsibility towards fuel / fuel cost is inconceivable. Cost of Fuel is definitely a consideration for the said supply as per the definition of “consideration” supra, in the course of furtherance of business and forms the most vital part in the intended supply of goods transport service by a GTA. Goods Transport Agency or GTA provides service in relation to transport of goods by road and to perceive provision of this service without the element of fuel, can in no way be a logical or workable proposition - if the proposed concept of provision of “free of cost diesel” by the service receiver for the instant supply of service of transportation of goods by road that too unaccounted by the service provider CIA, is justifiable it becomes all the more inconceivable to visualize a situation when the service receiver would besides providing free of cost diesel would also be providing “free of cost trucks/trailers” for the instant supply.
It is also seen that subsection (4) to Section 15 of the CGST Act, 2017 provides that where the value of the supply of goods or services or both cannot be determined under sub-section (1), the same shall be determined in such manner as may be prescribed. In the instant case, as price doesn't appear to be the sole consideration for the supply in question, in as much as diesel the most important ingredient consumable required for rendering the said supply of service of transportation by the applicant GTA is being provided by the service receiver, resort has to be taken to the valuation rules as prescribed - in the instant case in hand, where the supply of service being rendered is transportation of goods by road by the applicant GTA, and as diesel being provided free of cost being a consideration not wholly in money, the value of such supply shall be the sum total of consideration in money and such further amount in money as is equivalent to the consideration not in money which is known at the time of supply. This also goes on to substantiate that the cost of diesel provided by service receiver is to be considered for arriving at the GST liability in such supply.
In the instant transaction by the applicant diesel filled free of cost by the service recipient in the engaged chartered (dedicated) vehicles would form part of value of supply of service charged by the applicant and accordingly GST at the applicable rate would also be leviable on value inclusive of the cost of diesel filled by the service recipient, under GTA service.
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2021 (1) TMI 1286 - ITAT DELHI
Penalty initiated u/s 271(1)(c) - HELD THAT:- Undisputedly, coordinate Bench of the Tribunal [2020 (11) TMI 116 - ITAT DELHI] deleted the additions. In these circumstances, the penalty levied by the AO and confirmed by ld. CIT (A) is not sustainable in view of the law laid down in case cited as K.C. Builders & Anr [2004 (1) TMI 7 - SUPREME COURT] by holding that “when the addition made in the assessment order on the basis of which penalty for concealment is levied have been deleted there remains no basis at all for levying the penalty for concealment and in such case, no penalty can survive and the penalty is liable to be cancelled.” So, in view of the matter, penalties levied by the AO and confirmed by the ld. CIT (A) is ordered to be deleted. Consequently, the appeal filed by the assessee stands allowed.
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2021 (1) TMI 1285 - AUTHORITY FOR ADVANCE RULING, CHHATTISGARH
Levy of IGST under Reverse Charge Mechanism - deemed Ocean Freight on import of goods (raw material) on CIF basis - inter-state supply or not - HELD THAT:- An importer of goods is liable to pay 5% IGST under reverse charge on services by way of transportation of goods by a vessel from a place outside India up to the Customs station of clearance in India, provided by a person located in non-taxable territory to a person located in non-taxable territory and in case actual value of service (actual value of freight) is not known to importer, the same shall be deemed to be 10% of the CIF value of imported goods - Import of goods has been defined in the IGST Act, 2017 as bringing goods into India from a place outside India. All imports shall be deemed as inter-State supplies and accordingly Integrated tax shall be levied in addition to the applicable Custom duties. The IGST Act, 2017 provides that the integrated tax on goods imported into India shall be levied and collected in accordance with the provisions of the Customs Tariff Act, 1975 on the value as determined under the said Act at the point when duties of customs are levied on the said goods under the Customs Act, 1962. The integrated tax on goods shall be in addition to the applicable Basic Customs Duty (BCD) which is levied as per the Customs Tariff Act. In addition, GST compensation cess, may also be leviable on certain luxury and demerit goods under the Goods and Services Tax (Compensation to States) Cess Act, 2017.
Under the GST regime, Article 269 A constitutionally mandates that the supply of goods, or of services, or both in the course of import into the territory of India shall be deemed to be supply of goods, or of services, or both in the course of inter-State trade or commerce for levy of integrated tax. So, import of goods or services will be treated as deemed inter-State supplies and would be subject to Integrated tax - While IGST on import of services would be leviable under the IGST Act on reverse charge basis, the levy of the IGST on import of goods would be levied under the Customs Act, 1962 read with the Custom Tariff Act, 1975. Accordingly, the concept of “double taxation” propounded by the applicant in their application is thus found to be unsubstantiated, bereft of merit.
In the instant case, the applicant appears to be questioning the veracity and validity of levy of IGST on ocean freight under reverse charge mechanism, as stipulated under the aforesaid Notifications issued by the Central Government, on the recommendations of the GST council deriving powers as envisaged under section 5, subsection (1) of section 6 and clause (iii) and clause (iv) of section 20 of the Integrated Goods and Services Tax Act, 2017 (13 of 2016) road with sub-section (5) of section 15 and sub-section (1) of section 16 of the Central Goods and Services fax Act, 2017 (12 of 2017) and under sub-section (3) of section 5 of the Integrated Goods and Services Tax Act, 2017 (13 of 2017).
In terms of prevailing provisions of the IGST Act, 2017 and the Rules made there under, the applicant in addition to IGST on import of goods levied under the Customs Act, 1962 read with the Custom Tariff Act, 1975 would also be liable to pay IGST on deemed ocean freight under reverse charge mechanism as stipulated under Notification No. 10/2017-I.T.(Rate) read with Notification No. 8/2017-I.T.(Rate).
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2021 (1) TMI 1284 - ITAT HYDERABAD
Short term capital gains on slump sale - computation of net worth - DR submitted net worth of the asset has to be computed u/s.50B of the Act and therefore the AO has rightly reduced the liability from the value of the assets as on the date of sale to arrive at the net worth of the asset - HELD THAT:- Once AO has accepted that payment of part consideration directly to the bank is the application of its sale proceeds by the assessee, then it is to be considered that the liability has been discharged by the assessee and is no longer the liability of the purchaser.
Hence, the net worth of the assets does not include the liability of Rs.21.50 Lakhs, (as it is discharged by the assessee). There is no evidence brought on record by the department that the buyer has paid the assessee any amount more than Rs.51.50 Crores. The buyer has received the assets without any liability and therefore the net worth of the asset is Rs.55,14,38,969/-. In such circumstances, it cannot be said that the net worth of the asset has to be further reduced by the liability because the liability has already been discharged by the assessee only. Appeal of assessee is allowed.
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2021 (1) TMI 1283 - ITAT AHMEDABAD
TDS u/s 195 - Non deduction of TDS - commission expenses on export sales - expenses incurred are in the nature of ‘fee for technical services’ and thus falls within the sweep of Section 9(1)(vii) r.w. Explanation (2) thereto as against the claim of the assessee that commission payments are business expenses without involvement of any managerial, technical or consultancy services - HELD THAT:- It is the case of the assessee that the remittance have been made towards commission payments almost to the same parties as in the earlier years for which favourable view has been taken by the Tribunal on facts. It is the case of the assessee that the commission agents have rendered the services abroad and the situs of accrual or receipt of their commission income is outside India. It is further claimed that services rendered by agents have been utilized by the assessee outside India in procuring the export orders.
The issue is squarely covered in favour of the assessee by the decision of co-ordinate bench for AY 2010-11 as rightly acknowledged by the CIT(A). The commission payments are seen to be made to the similar set of parties as in AY 2010-11. The allegation on behalf of the Revenue that expenses incurred are covered in the wider definition of ‘fees for technical services’ as defined in Explanation (2) to Section 9(1)(vii) of the Act is devoid of any rationale.
Except for bald allegation of the services being akin to managerial or consultancy services, the AO has not brought any material on record to discard the stand of assessee. The co-ordinate Bench of Tribunal has duly analyzed this aspect in length [2017 (11) TMI 562 - ITAT AHMEDABAD] in the case of assessee itself and has delivered a speaking order in favour of the assessee on all aspects of subject matter on facts.
The services in respect of commission expenses are stated to be rendered outside India as well as utilized outside India and therefore the income arising by way of commission against rendition of agency services cannot be deemed to accrue or arise in India in the hands of the recipients of such commission payments. In the circumstances, where the income arising to non-resident commission agents is not found to be chargeable in India under S.4 r.w.s. 5(2) of the Act, the obligation u/s 195 of the Act for deduction of tax at source cannot be fastened upon the remitter assessee.
In the absence of statutory obligation arising u/s 195 for deduction of tax in the absence of chargeability of remittances, the corresponding disallowance u/s 40(a)(i) is without any merit and thus uncalled for. We thus see no error in the action of the CIT(A) who has rightly applied the decision of the Tribunal in the facts of the case. Appeal of the Revenue is dismissed.
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