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2012 (10) TMI 1260
Issues involved: Interpretation of interest granted to landowner u/s 28 of Land Acquisition Act, 1894 for tax computation.
Summary:
The High Court of Himachal Pradesh addressed the issue of calculating interest granted to a landowner u/s 28 of the Land Acquisition Act, 1894 for tax purposes. The main question was whether the interest should be calculated on a year-to-year basis or in the year when the amount is credited to the landowner. However, the Court referred to a judgment by the Supreme Court which clarified that the interest under Section 28 is considered a part of compensation and not separate interest. The Supreme Court emphasized the distinction between interest under Section 28, which is part of the enhanced compensation, and interest under Section 34, which is for delay in payment after the compensation amount is determined. The Court highlighted that the receipt of enhanced compensation, including interest under Section 28, is taxable in the year of receipt. Therefore, the interest under Section 28 is to be treated as part of compensation itself and not as separate interest, as per the Supreme Court's ruling. Consequently, the Court disposed of the appeal in line with the Supreme Court's judgment, directing the Assessing Officer to proceed accordingly without any costs being awarded.
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2012 (10) TMI 1259
Issues Involved:
1. Double jeopardy under Article 20 of the Constitution of India.
2. Applicability of Section 11B of the SEBI Act to investors.
3. Delay in initiating and completing disgorgement proceedings.
4. Merits of the case regarding the consideration for shares.
5. Charging of interest from January 2000.
Summary:
Issue (i): Double Jeopardy
The appellants argued that the Board's direction for disgorgement amounts to double jeopardy as they were already restrained from accessing the securities market for two years u/s 11B of the SEBI Act. The Tribunal held that the principle of double jeopardy is not applicable as these are civil actions for regulatory violations, not criminal proceedings. Disgorgement is not a penal action but a monetary equitable remedy to prevent unjust enrichment from unlawful conduct. The Tribunal cited previous cases to support this view and rejected the argument.
Issue (ii): Applicability of Section 11B to Investors
The appellants contended that they are merely investors and not intermediaries or persons associated with the securities market as defined u/s 12 of the SEBI Act. The Tribunal referred to the High Court of Gujarat's decision in Karnavati Fincap Ltd. v. SEBI, which held that "persons associated with the securities market" includes all who have dealings in the securities market, including investors. Therefore, the Tribunal rejected this argument.
Issue (iii): Delay in Disgorgement Proceedings
The appellants argued that the delay of 8 years in issuing the show-cause notice for disgorgement was unreasonable and barred by limitation. The Tribunal acknowledged the importance of expeditious proceedings but noted that the disgorgement order could only be passed after establishing the violation of the regulatory framework. The Tribunal found that the delay was not fatal given the seriousness of the charge and rejected the argument.
Issue (iv): Merits of the Case
The appellants claimed that they had borrowed money for the investment and that the transaction was complete with consideration. They also argued that they only earned Rs. 69,393 each from the sale of shares. The Tribunal held that in disgorgement proceedings, the merits of the case cannot be reexamined as the earlier order under Section 11B had acquired finality. The Tribunal found no fault with the Board's finding that the appellants had made unlawful gains of Rs. 60,72,000 each.
Issue (v): Charging of Interest
The appellants argued that charging interest from January 2000 was arbitrary since the show-cause notice was issued in February 2008. The Tribunal agreed, stating that interest should only be charged from the date the disgorgement amount became payable, i.e., after the expiry of 45 days from the date of the impugned order. The Tribunal modified the order to this extent.
Conclusion:
The appeal was partly allowed, modifying the interest charge to commence 45 days after the impugned order, with no order as to costs.
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2012 (10) TMI 1258
Issues Involved:
1. Whether the accused committed an offense u/s 138 of the Negotiable Instruments Act.
2. Whether the notice of dishonor was properly served on the accused.
Summary:
Issue 1: Offense u/s 138 of the Negotiable Instruments Act
The appellant, the complainant, alleged that the accused, his full-blood brother and proprietor of M/s. S.S. Electronics, borrowed Rs. 1,00,000 for business purposes and issued a cheque for repayment. The cheque was dishonored upon presentation. The complainant issued a notice to the accused, who failed to make the payment, leading to the filing of the case u/s 138 of the N.I. Act. The trial court acquitted the accused, but the High Court found that the accused had indeed issued the cheque and failed to repay the amount, thus committing the offense u/s 138 of the N.I. Act.
Issue 2: Service of Notice
The trial court acquitted the accused on the ground that the complainant failed to prove the service of notice as required under Proviso (b) to Section 138 of the N.I. Act. However, the High Court observed that the notice was sent to the accused's business address via courier, and the complainant asserted that the accused received it. The court referred to precedents, including K. Bhaskaran Vs. Vaidhyan Balan, which emphasized that the notice need only be sent to the correct address, and non-receipt due to evasion by the accused does not invalidate the notice. The High Court concluded that the notice was properly served, and the accused's failure to make payment constituted an offense.
Conclusion:
The High Court set aside the trial court's judgment, finding the accused guilty of the charge u/s 138 of the N.I. Act. The Registry was directed to issue notice to the accused for a hearing on the sentence.
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2012 (10) TMI 1257
Issues involved: Appeal against CIT (A) order regarding disallowance of set off of brought forward loss, addition of unsecured loan, and addition of payable amount to another entity.
Issue 1 - Set off of brought forward loss:
The assessee appealed against the disallowance of set off of brought forward loss of Rs. 78,781 by CIT (A). The ITAT considered the submission that the loss was already crystallized in assessment year 2001-02 and the assessee was only claiming set off in subsequent assessment years. Referring to previous ITAT orders, the ITAT allowed the set off, stating that once the loss is determined in the return filed u/s 139(3), the assessee becomes eligible for set off in subsequent years, irrespective of when the returns for those years were filed. The ITAT directed the AO to allow the set off subject to availability of loss after verification.
Issue 2 - Addition of unsecured loan:
The appeal also addressed the addition of an unsecured loan of Rs. 81,646 from Sangeeta Jaiswal and an amount of Rs. 44,242 payable to Raksha Holding Pvt. Ltd under section 68. The AO added these amounts to the total income without specifying the section invoked. The CIT (A) applied section 68 without considering that the credits were from earlier years. The ITAT directed the AO to verify whether the credits were of the current year and decide accordingly, as no addition can be made under section 68 or section 41(1) if the credits are from earlier years.
Conclusion:
The ITAT allowed the appeal for statistical purposes, directing the AO to allow the set off of the brought forward loss and to verify the year of receipt of the loan/liability before making any additions.
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2012 (10) TMI 1256
The Supreme Court of India dismissed the special leave petitions as no ground was found for interference with the High Court's view, based on the order dated 22nd August, 2012 in CA No. 5961 of 2012.
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2012 (10) TMI 1255
Issues Involved:1. Disallowance of deduction u/s 80IA for profits derived from developing a new infrastructure facility. Summary:Issue 1: Disallowance of Deduction u/s 80IAThe assessee appealed against the CIT(A)-IV, Hyderabad's order dated 15.6.2009, which confirmed the disallowance of deduction u/s 80IA for profits derived from developing a new infrastructure facility. The learned AR referenced a similar issue in the assessee's own case (ITA No. 1292/Hyd/2010) where the Tribunal had previously ruled in favor of the assessee. The learned DR suggested remanding the issue to the Assessing Officer (AO) for fresh examination to verify if the assessee met the conditions u/s 80IA read with the Explanation below section 80IA(13). The Tribunal reviewed the material and noted that the same issue had been considered in the assessee's own case and other similar cases, such as M/s. Koya & Co. Construction (P) Ltd. v. ACIT, GVPR Engineers Ltd. v. ACIT, KMC Construction Ltd. v. ACIT, and Sushee Hi-Tech Constructions Pvt. Ltd. vs. DCIT. The Tribunal reiterated that for eligibility u/s 80IA, the enterprise must be involved in developing, operating, and maintaining infrastructure facilities. The Tribunal emphasized that the nature of the work undertaken by the assessee should be analyzed to determine if it qualifies as development rather than a mere works contract. The Tribunal cited previous rulings where it was held that developers undertaking entrepreneurial and investment risks are eligible for deduction u/s 80IA, whereas contractors undertaking only business risks are not. The Tribunal directed the AO to examine the records and determine if the contracts involved design, development, operation, maintenance, financial involvement, and defect correction. If these conditions are met, the contracts should be considered as development of infrastructure facilities, making the assessee eligible for deduction u/s 80IA. The AO was instructed to compute the profit from such contracts on a pro-rata basis of turnover and grant the deduction accordingly. In conclusion, the Tribunal remitted the issue back to the AO for fresh consideration and directed the AO to verify if the assessee carried on the development of infrastructure facilities along with the specified activities. The appeal was allowed for statistical purposes. Order pronounced in the open court on 31st October, 2012.
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2012 (10) TMI 1254
Unexplained Cash Credits u/s 68 - Genuineness of sales along with the identity of the buyers was argued to be in dispute. Onus to prove was casted upon the assessee to explain the credits in the books which was duly discharged by him by presenting all details along with regular books of accounts, sale invoices, vouchers, receipt books etc. Still addition was made by AO u/s 68 on the ground that books of purchasers didn't contain any entry regarding such transactions.
HELD THAT:- CIT(A) has rightly come to the conclusion that the addition made by the Assessing Officer u/s 68 of the Act by considering the sale proceeds as cash credits cannot be sustained. AO has not doubted the genuineness of the purchases and when the stocks tally has been accepted by the AO then there is no reason to doubt the sales. Also, if the purchasing dealers did not account for the transaction in their books, the assessee cannot be penalised.
The decision in the case of LAKHMICHAND BAIJNATH VERSUS COMMISSIONER OF INCOME-TAX, WEST BENGAL [1958 (11) TMI 3 - SUPREME COURT] was referred where it was held that amount credited in business books can normally be presumed as business receipts.
The expression “books” with respect to s.68 is concerned, the Hon’ble Punjab & Haryana High Court in the case of SMT. SHANTA DEVI VERSUS COMMISSIONER OF INCOME-TAX [1987 (10) TMI 26 - PUNJAB AND HARYANA HIGH COURT], held that such books denotes books of assessee himself and not of other parties. Addition made by the AO u/s 68 of the Act by considering the sale proceeds as cash credits cannot be sustained.
Decision in favour of Assessee.
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2012 (10) TMI 1253
Issues: Interpretation of Section 33 of the Indian Evidence Act regarding admissibility of a witness's deposition in a different case.
Summary:
The 1st respondent filed a suit for recovery based on a promissory note, which was decreed. Subsequently, in an execution petition, the 1st respondent sought to mark the deposition of the petitioner from a different suit. The petitioner objected citing Section 33 of the Indian Evidence Act. The executing Court overruled the objection and allowed the deposition to be marked as an exhibit, leading to the revision petition.
The main issue was whether the deposition of the petitioner in a different suit could be admitted as evidence in the current execution petition. Section 33 of the Act was crucial in this regard, outlining conditions for the admissibility of a witness's evidence in subsequent proceedings involving the same parties and similar issues.
The Court emphasized that the conditions under Section 33 must be met for such evidence to be admissible. In this case, the petitioner was alive and available for examination, rendering the deposition inadmissible. The 1st respondent failed to establish any of the conditions required by the provision.
The Court distinguished the present case from a precedent where a witness was confronted with a statement from another suit, highlighting the difference between confronting a witness with a statement and incorporating the entire deposition into the record of a different case.
Ultimately, the civil revision petition was allowed, the impugned order was set aside, and no costs were awarded. The miscellaneous petition filed was also disposed of accordingly.
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2012 (10) TMI 1252
Issues Involved:
1. Conviction u/s 302/34, 201, 120-B, and 404 IPC.
2. Circumstantial evidence and motive.
3. Reliability of police witnesses and recoveries.
4. Examination of accused u/s 313 CrPC.
Summary:
1. Conviction u/s 302/34, 201, 120-B, and 404 IPC:
The appellant was convicted along with co-accused Shivani Chopra u/s 302/34 IPC for murder, u/s 201 IPC for causing disappearance of evidence, u/s 120-B IPC for criminal conspiracy, and u/s 404 IPC for dishonestly misappropriating property. The sentences were ordered to run concurrently.
2. Circumstantial Evidence and Motive:
The case was based on circumstantial evidence. The court emphasized that all circumstances must be fully established and consistent with the guilt of the accused. The intimate relationship between the appellant and co-accused Shivani Chopra, and her relationship with the deceased, Ashok Jain, was established. The appellant's car was parked at the Delhi Airport during the relevant time, and call records placed him near the crime scene. The motive was to rob Ashok Jain and eliminate him as an obstacle in the appellant's relationship with Shivani Chopra.
3. Reliability of Police Witnesses and Recoveries:
The court upheld the reliability of police witnesses and recoveries, even in the absence of independent witnesses. The recoveries included a blood-stained hammer, knife, and clothes, and were made based on the appellant's disclosure statement. The court cited State, Govt. of NCT of Delhi v. Sunil and Anr., emphasizing that police actions should not be presumed untrustworthy without evidence to the contrary.
4. Examination of Accused u/s 313 CrPC:
The appellant failed to provide a satisfactory explanation for the incriminating circumstances during his examination u/s 313 CrPC. The court noted that merely claiming innocence and alleging that recoveries were planted was insufficient without supporting evidence.
Conclusion:
The Supreme Court found no merit in the appeal and dismissed it, affirming the concurrent findings of the lower courts. The appellant's conviction and sentences were upheld based on the established circumstantial evidence and the lack of a credible defense.
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2012 (10) TMI 1251
Issues involved: Consideration of objections filed by the petitioner u/s D3 proposals for assessment years 2002-03 and 2003-04, influence of adverse directions from higher authority on decision making process.
Consideration of objections for assessment years 2002-03 and 2003-04:
The petitioner filed objections to notices issued by the first respondent for the assessment years 2002-03 and 2003-04. The second respondent issued directions instructing the Assessing Officer to implement the D3 proposals for both years. The petitioner requested the first respondent to consider their objections independently without being influenced by the second respondent's directions. The Court directed the first respondent to consider the objections and pass appropriate orders without being influenced by any adverse remarks from the second respondent, ensuring a fair decision-making process.
Influence of adverse directions on decision making process:
The Government Advocate (Taxes) argued that the directions from the second respondent did not contain any adverse remarks that would unduly influence the first respondent's decision-making process regarding the D3 proposals. The Court found it appropriate to direct the first respondent to consider the objections without being influenced by any alleged adverse remarks from the second respondent, ensuring a fair and impartial decision-making process. The first respondent was also instructed to pass orders in accordance with the Court's previous order and provide the petitioner with a personal hearing opportunity.
Conclusion:
The Court disposed of the Writ Petitions accordingly, with connected miscellaneous petitions closed and no costs imposed. The judgment emphasized the importance of fair consideration of objections and independent decision-making processes in tax assessment matters, ensuring justice and procedural fairness for all parties involved.
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2012 (10) TMI 1249
Issues Involved:
1. Whether the transfer of land by Krishna Reddy and sons to their firm attracts capital gains u/s 45(3) of the Income Tax Act.
2. Whether the land granted to Krishna Reddy is a joint family property or individual property.
3. Whether the penalty levied u/s 158BFA(2) of the Income Tax Act is correct.
Summary:
Issue 1: Capital Gains u/s 45(3)
The court examined whether the transfer of land by Krishna Reddy and his sons to their firm attracted capital gains u/s 45(3) of the Income Tax Act. The Assessing Officer (A.O.) had assessed the capital gains based on the sale value of the property in 1998, which was deemed impermissible. The court held that u/s 45(3), the value recorded in the firm's books of accounts should be considered, not the market value. It was noted that the firm had not maintained any books of accounts, and the A.O. relied on seized material, which was not permissible. The Tribunal's finding that the transfer did not attract capital gains was upheld, and the questions were answered against the revenue.
Issue 2: Joint Family Property vs. Individual Property
The court addressed whether the land granted to Krishna Reddy was a joint family property or individual property. The revenue contended that the partnership and dissolution deeds described the property as co-owned, not joint family property. However, the assessees produced land revenue records and a registered partition deed from 1999, indicating the property was a joint family property. The court concluded that the property was indeed a joint family property, and the revenue's contention was untenable. The question of law was answered against the revenue.
Issue 3: Penalty u/s 158BFA(2)
The court considered whether the penalty levied u/s 158BFA(2) was correct. Given the confusion regarding the nature of the property (joint family vs. individual), the Tribunal found that the levy of penalty was not justified. The court upheld this finding, stating that since the property was determined to be a joint family property, the question of penalty on individual assessees did not arise.
Conclusion:
The appeals of the revenue (I.T.A.Nos.81/06, 97/06, 98/06, 1022/08, 1023/08, and 1024/08) were dismissed, and the appeals of the assessee (I.T.A.Nos.54/06, 53/06, and 52/06) were allowed. The court held that the property was a joint family property, and the computation of tax should follow accordingly.
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2012 (10) TMI 1248
Issues Involved:
1. Amendment of the complaint to correct the name of the accused.
2. Powers of the Magistrate to allow such amendments.
3. Applicability of provisions of Cr.P.C. and N.I. Act in such amendments.
4. Whether the complainant can be blamed for incorrect names due to lack of information.
Summary:
1. Amendment of the Complaint to Correct the Name of the Accused:
The petitioner challenged the judgment allowing the complainant to correct the name of the accused from "Amol Trilokchand Shaha" to "Amol Shripal Seth" in a proceeding u/s 138 of the Negotiable Instruments Act. The Sessions Court held that there was no question of identity about the accused and supported the Magistrate's decision based on documents indicating the petitioner was the Managing Director of the accused company.
2. Powers of the Magistrate to Allow Such Amendments:
The Court examined various precedents and held that the Magistrate has incidental and ancillary power to allow amendments in the complaint, even though there is no express provision for such amendments in the Cr.P.C. The Court emphasized that the Magistrate takes cognizance of the offence and not the offender, and thus can ascertain the correct identity of the accused during the trial.
3. Applicability of Provisions of Cr.P.C. and N.I. Act in Such Amendments:
The Court discussed the relevant provisions of Cr.P.C. including sections 2(d), 190, 202, 204, and 319, and concluded that these provisions do not necessitate the mention of the accused's name in the complaint. The Court also referred to section 141 of the N.I. Act, which holds persons in charge of the company responsible for the offence, and stated that the complainant cannot be blamed for incorrect names if the company fails to provide accurate information.
4. Whether the Complainant Can Be Blamed for Incorrect Names Due to Lack of Information:
The Court held that the complainant, being a stranger to the company, may not have accurate information about the company's management. The statutory notice u/s 138(b) of the N.I. Act requires the company to disclose the responsible persons. If the company fails to provide this information, the complainant cannot be blamed for any defects in the complaint. The Court also noted that the burden of proof lies on the company officials to show they were not responsible for the offence.
Conclusion:
The Court dismissed all three applications, stating that the Magistrate's orders and the Sessions Court's decisions were correct. The petitioner's attempts to protract the proceedings were noted, and the Court emphasized the need for expeditious disposal of such cases as per the legislative intent behind the N.I. Act. The request for a stay was denied.
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2012 (10) TMI 1247
Issues involved: The admissibility of a promissory note in the context of stamp duty adequacy.
Summary:
1. The petitioner filed a suit for recovery based on a promissory note, objected by the respondent due to stamp paper purchased in another state.
2. The trial court upheld the objection citing Rule 3(iii) of the Indian Stamp Rules.
3. The petitioner argued that the validity of the promissory note cannot be tested based on the state of stamp paper purchase, citing relevant legal provisions and a Supreme Court judgment.
4. The suit involved a promissory note executed on a stamp paper purchased in a different state, leading to the objection based on Rule 3(iii) of the Rules.
5. The rule mandates the use of state-specific stamp papers for instruments chargeable with duty, as discussed in detail by the trial court.
6. Two key questions arose: interpretation of "instruments chargeable with duty under the Act" and the curability of the defect arising from using stamp paper from another state.
7. The Act's central legislation empowers Parliament to enact stamp duty rates, distinguishing between Union and State List provisions.
8. The Supreme Court precedent clarified the applicability of central laws to instruments like promissory notes.
9. The trial court's reliance on Rule 3(iii) was challenged, emphasizing the curability of defects under Section 37 of the Act.
10. The mechanism under Section 37 and Rule 18 allows for curing defects related to stamp paper descriptions.
11. The primary purpose of stamp paper use is to authenticate transactions, with revenue collection being secondary.
12. The court allowed the revision petition, overruling the objection on the promissory note's admissibility based on stamp paper origin.
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2012 (10) TMI 1246
Issues Involved:
1. Parallel-imports/grey-market goods.
2. Trade Marks Act 1999: International Exhaustion Principle vs. National Exhaustion Principle.
3. Infringement and permissible use of registered trade marks.
4. Meta-tagging of websites.
5. Interim injunctions and final relief.
Summary:
Issue 1: Parallel-imports/grey-market goods
The respondents alleged that the appellants were importing and selling Samsung printers in India without authorization, constituting trademark infringement. The appellants argued their actions were legal, claiming benefits to Indian consumers through lower prices.
Issue 2: Trade Marks Act 1999: International Exhaustion Principle vs. National Exhaustion Principle
The core issue was whether the Trade Marks Act 1999 embodies the International Exhaustion Principle or the National Exhaustion Principle. The learned Single Judge concluded that the Act embodies the National Exhaustion Principle. However, upon appeal, it was determined that the Act adopts the Principle of International Exhaustion of Rights, meaning goods lawfully acquired and placed in the international market can be sold in India without constituting trademark infringement.
Issue 3: Infringement and permissible use of registered trade marks
Section 29 and Section 30 of the Trade Marks Act 1999 were analyzed. The learned Single Judge initially found that importation without the registered proprietor's consent constituted infringement. However, upon re-evaluation, it was concluded that lawful acquisition and sale in the international market do not constitute infringement under Section 30(3), provided the goods are not impaired or their condition changed.
Issue 4: Meta-tagging of websites
The respondents claimed that the appellants' meta-tagging of their website to that of the respondents constituted trademark infringement. The court affirmed the injunction against meta-tagging, emphasizing that appellants must independently display product information without relying on the respondents' website.
Issue 5: Interim injunctions and final relief
The interim injunction restraining the appellants from importing and selling Samsung products was set aside, provided the appellants prominently display disclaimers in their showrooms indicating that the products are imported and that Samsung (Korea) does not provide warranties or after-sales services for these goods. The appellants were required to state that they personally warranty the quality and provide after-sales services.
Conclusion:
The appeal was partially allowed. The appellants were permitted to import and sell Samsung products in India with appropriate disclaimers, but were restrained from meta-tagging their website to that of the respondents. The court's opinion was prima facie for the purposes of interim relief and not conclusive on the merits of the case.
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2012 (10) TMI 1245
Issues involved: Appeal u/s 260A of the Income Tax Act, 1961 against the order of the Income Tax Appellate Tribunal for the block assessment year 01.04.1995 to 07.06.2001.
Issue 1: Tribunal's decision on family arrangement and division of property.
The Tribunal considered the family arrangement dated 1-6-2001 and absence of evidence of property division. The Appellant argued that the HUF continued to exist and should be taxed. The Respondent contended that the HUF was disrupted before the survey, and provided evidence of the family arrangement and mutation application. The Court held in favor of the Respondent, noting that the family arrangement need not be registered, citing relevant case law.
Issue 2: Treatment of bad debts and tax liability.
The Assessing Officer disallowed bad debts deduction due to lack of proof of irrevocability. The Appellant argued that the debts were written off and compliance with Section 36(i)(iv) was sufficient. The Respondent highlighted the losses incurred by the assessee and the disruption of the HUF. The Court found the Assessing Officer's approach contrary to law and upheld the Tribunal's decision. The disrupted HUF cannot be taxed, and the appeal was dismissed.
This judgment addresses the issues of family arrangement and bad debts deduction in the context of income tax assessment, emphasizing compliance with relevant legal provisions and the disruption of the Hindu Undivided Family (HUF) in determining tax liability.
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2012 (10) TMI 1244
Issues Involved:
1. Addition of income based on excess amount collected for vehicle registration.
2. Validity of evidence from a group concern applied to the assessee.
3. Estimation of income without direct evidence.
Summary:
Issue 1: Addition of income based on excess amount collected for vehicle registration.
The Assessing Officer (A.O.) made an addition to the assessee's income by estimating a sum of Rs. 2000 per vehicle as excess amount collected for registration charges. The amounts considered for each assessment year were Rs. 41,02,000 (2003-04), Rs. 10,42,000 (2004-05), Rs. 7,60,000 (2005-06), Rs. 13,14,000 (2006-07), and Rs. 11,28,000 (2007-08).
Issue 2: Validity of evidence from a group concern applied to the assessee.
The CIT(Appeals) opined that evidence found during the search of another concern could not be universally applied to all concerns within the same group. In the assessee's case, no evidence was found to show any amount was collected from customers. The CIT(Appeals) relied on the decision of the Hon'ble jurisdictional High Court in CIT v. S. Khader Khan Son (300 ITR 157), stating that additions based on estimates without rejecting or finding defects in the books of accounts could not be justified.
Issue 3: Estimation of income without direct evidence.
The Tribunal noted that a similar issue had been decided in favor of the assessee's sister concern, Susee Auto Plaza (P) Ltd., where it was held that additions based on alleged collections without incriminating documents could not be sustained. The Tribunal emphasized that no incriminating evidence was found directly related to the assessee-company, and any addition based on statements not confronted to the assessee could not be sustained legally. The Tribunal concluded that the entire addition made by the A.O. was based on sheer estimation and not supported by direct evidence.
Conclusion:
Respectfully following the decision in the case of Susee Auto Plaza (P) Ltd., the Tribunal agreed with the CIT(Appeals) that the addition made for all these years should be deleted. Consequently, the appeals filed by the Revenue were dismissed. The order was pronounced in the Court on Thursday, the 11th of October, 2012, at Chennai.
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2012 (10) TMI 1243
Issues Involved:
1. Interpretation and applicability of Section 82(4) Cr.P.C.
2. Distinction between "proclaimed person" and "proclaimed offender".
3. Legal consequences and liabilities of being declared a proclaimed offender.
Summary:
Interpretation and Applicability of Section 82(4) Cr.P.C.:
The primary issue in the present case is the interpretation and applicability of Section 82(4) Cr.P.C. The petitioner challenged the order declaring him a proclaimed offender on the grounds that the offenses he was accused of did not fall under the list specified in Section 82(4) Cr.P.C. The court clarified that Section 82(4) Cr.P.C. should not be read in isolation but in conjunction with other provisions of Cr.P.C. and IPC, including Section 174A IPC. The court emphasized that the intention of the legislature was to provide stringent punishment for non-appearance pursuant to a proclamation, and the provisions of Section 82(4) Cr.P.C. should be harmoniously construed with Section 174A IPC to avoid rendering any provision otiose or redundant.
Distinction between "Proclaimed Person" and "Proclaimed Offender":
The court addressed the distinction between a "proclaimed person" under Section 82(1) Cr.P.C. and a "proclaimed offender" under Section 82(4) Cr.P.C. It clarified that the distinction is primarily in the context of the mode of declaration and the additional requirement of a formal inquiry for offenses specified in Section 82(4) Cr.P.C. The court held that the nomenclature of being a "proclaimed person" or a "proclaimed offender" does not diminish the rigour of Section 174A IPC, which prescribes stringent punishment for non-appearance in response to a proclamation.
Legal Consequences and Liabilities:
The court detailed the legal consequences and liabilities attached to being declared a proclaimed offender, including the ability of police officers to arrest without a warrant, the attachment of property, and the requirement for public and village officers to report the whereabouts of proclaimed offenders. The court also highlighted that the declaration of a proclaimed offender ceases to be operative once the person is arrested or appears before the court.
In conclusion, the court held that the provisions of Section 82(4) Cr.P.C. do not provide immunity to absconders of offenses not listed under it from being declared proclaimed offenders. The petition was dismissed as the petitioner failed to establish any statutory violation of the provisions of Section 82 Cr.P.C.
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2012 (10) TMI 1242
Issues Involved:
1. Delay in FIR registration.
2. Validity of postmortem report.
3. Reliability of extra-judicial confession.
4. Recovery of the deceased's body.
Summary:
1. Delay in FIR Registration:
The appellant contended that the 52-day delay in registering the FIR rendered the prosecution's story unbelievable. However, the court found that the delay was justified due to the appellant's misleading information to the deceased's family, causing them to wait in hope for his return. The court concluded that the delay did not discredit the prosecution's case.
2. Validity of Postmortem Report:
The appellant argued that the postmortem report did not specify the cause of death, thus questioning the murder charge. The court noted that the body was in a decomposed state, making it difficult for the doctors to determine the exact cause of death. However, the recovery of the body based on the appellant's information and the identification of personal articles worn by the deceased were sufficient to establish the murder charge.
3. Reliability of Extra-Judicial Confession:
The appellant claimed that her extra-judicial confession was made under pressure and thus inadmissible u/s 24 of the Evidence Act. The court, however, found that even without considering the extra-judicial confession, the chain of circumstantial evidence was strong enough to establish the appellant's guilt.
4. Recovery of the Deceased's Body:
The appellant contended that the body was recovered from an adjacent place, not her house. The court held that the recovery of the body from a place adjacent to the appellant's house, based on her information, was sufficient to implicate her in the murder.
Conclusion:
The Supreme Court upheld the conviction and sentence of the appellant for offences u/s 302 and 201 of the Indian Penal Code. The appeal was dismissed, and the appellant was ordered to be taken into custody to serve the remaining part of her sentence.
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2012 (10) TMI 1241
Issues Involved:
The judgment involves issues related to assessment under section 115JB, disallowances of various expenses, adjustments in computation of total income, determination of book profits, and levy of interest under different sections.
Assessment under Section 115JB:
The assessee, a manufacturer and trader of cement, filed its return of income declaring 'NIL' income but paid tax under section 115JB. The AO made various disallowances and additions, leading to a demand of Rs. 70,77,340. The CIT(A) held that the AO erred in disturbing the computation of income and deleted most additions except for loss on sale of fixed assets. The CIT(A) directed the restoration of income as per section 115JB at Rs. 1,51,12,20,047. The revenue appealed against this order.
Disallowances and Additions:
The AO made several disallowances totaling to Rs. 17,07,94,505, including disallowances for repairs, maintenance charges, community development expenses, and others. The CIT(A) found that the expenses disallowed would not stand the test of appeal and deleted most additions except for loss on sale of fixed assets. The revenue challenged the CIT(A)'s decision.
Adjustments in Computation of Total Income:
The AO made adjustments to the computation of total income, leading to wrong computation of total income and book profits under section 115JB. The CIT(A) observed that section 115JB is a self-contained code, and no additions or deletions are possible beyond its provisions. The CIT(A) directed the restoration of income as per section 115JB. The revenue raised grounds of appeal against the CIT(A)'s order.
Levy of Interest and Book Profits Determination:
The AO wrongly levied interest under sections 234C and 115WJ, leading to excess interest being charged. The CIT(A) held that the AO erred in not following proper procedures and remanded the matter back for examination. The revenue's appeal was treated as allowed for statistical purposes, and the assessee's cross-objections were dismissed as infructuous.
This judgment highlights the importance of proper assessment procedures, adherence to section 115JB provisions, and the need for thorough examination of expenses and additions before making adjustments to income computation.
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2012 (10) TMI 1240
Issues involved:
The judgment deals with the issue of treating a loss as a speculative transaction under section 43(5)(d) of the IT Act, and whether the loss from future and option transactions can be set off against profits from other businesses.
Details of the judgment:
Issue 1: Treatment of loss as speculative transaction
The appellant, a Revenue, challenged the order of the ld. CIT(A) which treated the entire loss as a loss from derivative transactions under section 43(5)(d), despite the loss being also due to trading in shares. The AO found that the assessee had started speculation business and set off speculation loss against profit from food grain business. The assessee claimed that the transactions were through recognized Stock Exchanges and hence not speculative. The ld. CIT(A) accepted the contention, citing relevant case laws, and allowed the appeal of the assessee.
Issue 2: Set off of loss from future and option transactions
The AO did not allow the set off of speculation loss against profit from food grain business, leading to the appeal before the ld. CIT(A). The assessee argued that the transactions were through recognized Stock Exchanges, making them non-speculative. The ITAT found no infirmity in the ld. CIT(A)'s order, as both parties did not dispute the facts, and the Revenue itself admitted that the loss was due to trading in shares. The ITAT upheld the decision, citing relevant provisions of the IT Act and supporting case laws.
In conclusion, the ITAT dismissed the departmental appeal, stating that the loss from future and option transactions through recognized Stock Exchanges cannot be treated as speculative transactions under section 43(5)(d) of the IT Act. The judgment highlights the importance of conducting transactions through recognized Stock Exchanges to avoid speculative treatment of losses.
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