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Showing 21 to 40 of 464 Records

• 1999 (11) TMI 888
  
  The Supreme Court dismissed the civil appeals as no demand for recovery of basic excise duty was made upon the Respondent under Tariff 15(a)(2). No costs were awarded.

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• 1999 (11) TMI 887
  
  Issues Involved:
  1. Allegations of oppression and mismanagement u/s 397/398 of the Companies Act, 1956.
  2. Compliance with the family agreement dated March 23, 1991.
  3. Mismanagement of the plastic division.
  4. Transfer of shares to VLS Finance and its implications.
  5. Deadlock in the management and the proposed division of assets.
  
  Summary:
  
  1. Allegations of Oppression and Mismanagement u/s 397/398:
  The petitioners alleged acts of oppression and mismanagement by the respondents in the affairs of Trackparts of India Limited. The company, a public listed entity, was originally a private limited company formed in 1969. The petitioners claimed that the respondents did not comply with the family settlement agreement, leading to unequal shareholding and autocratic management by the respondent. The respondents countered by stating that the petitioners, despite being in minority, were trying to retain control of the company.
  
  2. Compliance with the Family Agreement:
  A family agreement dated March 23, 1991, was entered into between the families of the four brothers, providing for equalization of shareholding and joint management. The petitioners alleged that the DB group did not comply with the terms of the agreement, leading to unequal shareholding. The respondents argued that the family agreement, which provided for arbitration in case of disputes, could not be enforced through this petition.
  
  3. Mismanagement of the Plastic Division:
  The petitioners alleged that the plastic division, started in 1994, was mismanaged by the respondent, leading to heavy losses and financial difficulties for the company. The respondents contended that the plastic division suffered due to inadequate financing and lack of support from the petitioners. Both parties accused each other of actions that worsened the financial situation of the company.
  
  4. Transfer of Shares to VLS Finance:
  The petitioners facilitated the transfer of shares to VLS Finance, which the respondents claimed reduced their majority to a minority. The respondents argued that the transfer was in violation of Article 110 and the SEBI Take Over Code. The petitioners maintained that the transfer was legal and necessary due to the pledge agreement with VLS Finance. The Company Law Board noted that the legality of the transfer should be adjudicated separately, especially since VLS Finance stated they would not exercise voting rights.
  
  5. Deadlock in Management and Proposed Division of Assets:
  The Company Law Board observed that the disputes between the parties led to a deadlock in the management. Despite attempts for amicable settlement, including appointing a former Supreme Court judge as chairman, the parties could not resolve their differences. The Board concluded that the division of assets was the only solution to end the disputes. The petitioners would manage the forge division, and the respondents would manage the other two divisions. A fresh board would be constituted with an independent chairman nominated by ICICI to oversee the division process.
  
  Conclusion:
  The Company Law Board directed the division of assets of Trackparts of India Limited to resolve the disputes between the family shareholders. The petitioners would manage the forge division, and the respondents would manage the other two divisions. The ICICI would appoint a valuer to determine the value of shares and the forge division, and the company would purchase the petitioners' shares, effecting a reduction in share capital. The final division of assets was to be completed by June 30, 2000, under the supervision of an independent chairman.

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• 1999 (11) TMI 886
  
  Issues:
  1. Challenge to notice under Section 133(6) of the Income-Tax Act, 1961 by a Co-operative society.
  2. Interpretation of the term 'person' under Section 2(31) of the Act.
  3. Validity of the notice seeking information about deposits made by members.
  4. Requirement of prior approval for seeking information under Section 133(6).
  5. Scope of information that can be requested under Section 133(6).
  6. Comparison with previous judgments on the scope of 'enquiry' and 'proceedings' under Section 133(6).
  
  Analysis:
  
  1. The petitioner, a Co-operative society, challenged a notice under Section 133(6) of the Income-Tax Act, 1961, seeking information about deposits made by its members. The petitioner contended that it should not be required to furnish the information as it is not a 'person' or 'banking company' under the Act.
  
  2. The definition of 'person' under Section 2(31) of the Act includes any association of persons, making a Co-operative society fall under this definition. Thus, the respondent is entitled to request information from the petitioner society.
  
  3. The notice sought information about deposits made by members, aiming to verify income declarations and sources of deposits. The court found this information relevant for tax enquiries and not a roving enquiry, thus upholding the validity of the notice.
  
  4. The petitioner argued that the authorized officer should record the necessity of information before issuing the notice. However, the court found that the notice referred to the approval of the Director of Income Tax, meeting the requirement of prior approval for seeking information under Section 133(6).
  
  5. Section 133(6) empowers officers to require information useful for tax enquiries. The court held that seeking information about deposits made with the Co-operative society falls within the scope of 'points or matters' relevant to tax proceedings, allowing the respondent to request such details.
  
  6. Previous judgments were cited to distinguish between 'enquiry' and 'proceedings' under Section 133(6). The court clarified that the amended provision enables officers to seek general information related to deposits, not limited to ongoing proceedings, aligning with the broader scope of 'enquiry' post-amendment.
  
  In conclusion, the court dismissed the petition, upholding the validity of the notice under Section 133(6) and requiring the petitioner to furnish the requested information within the specified time frame, emphasizing the relevance of the information for tax enquiries.

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• 1999 (11) TMI 885
  
  ... ...
  ... ... ..... . ORDER Delay condoned. The civil appeal is dismissed.

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• 1999 (11) TMI 884
  
  Issues:
  1. Cancellation of penalty under section 271B by the Tribunal.
  2. Distinction between absolute default and mere delay in filing audit report under section 44AB.
  
  Analysis:
  1. The case involved the assessment years 1986-87 and 1987-88 where the Tribunal was questioned for canceling the penalty under section 271B of the Income Tax Act, 1961. The Tribunal found that the delay in obtaining the audit report did not constitute an absolute default by the assessee. The Tribunal referred to a previous decision and concluded that penalty under section 271B was not attracted solely due to the delay in obtaining the audit report, hence the penalty was canceled.
  
  2. Section 44AB imposes an obligation on individuals with sales turnover exceeding a specified amount to get their accounts audited. Section 271B provides for a penalty if there is a failure to comply with the audit requirements. However, section 273B states that no penalty shall be levied if there is a reasonable cause for the failure. In this case, the assessee had applied for an extension of time for filing the return, and the audit reports were filed within the extended time. The Tribunal considered the extension granted by the department as a reasonable cause for the delay in obtaining the audit report. The Tribunal opined that the penalty under section 271B cannot be levied in every case and should only be imposed if there is no reasonable cause for the delay.
  
  In conclusion, the High Court upheld the Tribunal's decision to cancel the penalty under section 271B for the assessment years 1986-87 and 1987-88. The Court emphasized the importance of considering reasonable causes for delays in compliance with tax laws and highlighted the significance of section 273B in determining the applicability of penalties under section 271B.

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• 1999 (11) TMI 883
  
  Supreme Court judgment: Delay condoned. Appeal admitted. Citation: 1999 (11) TMI 883 - SC. Justices: Mr. S.P. Bharucha and Mr. D.P. Wadhwa.

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• 1999 (11) TMI 882
  
  The Gujarat High Court ruled in favor of the assessee regarding depreciation on factory and office buildings despite the conveyance deed not being registered by the end of the accounting year. The decision was based on the assessee acquiring possession and running the factory after making substantial payments. The court cited a similar case where possession and part payment were deemed sufficient for depreciation entitlement. The appeal in Tax Appeal No. 150 of 1999 was dismissed in favor of the assessee.

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• 1999 (11) TMI 881
  
  The Supreme Court dismissed the civil appeal without interference and no order was given regarding costs.

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• 1999 (11) TMI 880
  
  Issues involved:
  The interpretation of a notification under Section 3B of the Madhya Pradesh Electricity Duty Act, 1949 regarding exemption for producers running industries with their own generating units.
  
  Judgment Summary:
  
  Issue 1: Interpretation of Notification under Section 3B
  The appellants claimed exemption under a notification exempting producers running industries with their own generating units from payment of duty. The High Court held that only producers who set up generating units after a specified date were entitled to the exemption. The Supreme Court emphasized that exemption notifications in fiscal matters must be strictly construed. The Court cited precedent stating that entitlement to exemption depends on the construction of the notification in its entirety. The appellants' attempt to interpret the notification differently was rejected by the High Court, which held that the exemption applied only to industries establishing generating units after the specified date. The Supreme Court upheld the High Court's decision, stating that the language of the notification clearly indicated the intention to exempt industrial units established after the specified date. The Court found no reason to disagree with the High Court's conclusions and dismissed the appeals.
  
  This judgment clarifies the importance of interpreting exemption notifications in fiscal matters strictly and in their entirety, without dissecting them to suit specific interpretations.

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• 1999 (11) TMI 879
  
  Issues Involved:
  1. Non-payment of rent.
  2. Subletting.
  3. Damage to the premises.
  4. Bona fide need of the appellants.
  
  Detailed Analysis:
  
  Non-payment of Rent:
  The appellants filed a suit for eviction on four grounds, including non-payment of rent. The trial court dismissed the suit on all grounds. On appeal, the appellate court found the first respondent (tenant) defaulted in rent payment and was liable for eviction but protected the second respondent (sub-tenant). The High Court, in a writ petition, fixed the determination of the first respondent's tenancy to April 17, 1982. The Supreme Court upheld that the second respondent becomes a direct tenant from this date, as per Section 14 of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947.
  
  Subletting:
  The appellants alleged unauthorized subletting by the first respondent to the second respondent. The courts found subletting occurred before 1959, thus protecting the second respondent under Section 14. The Supreme Court noted that the appellants failed to specify the subletting date in their notice and did not produce rent receipt counterfoils, weakening their case. The second respondent, deemed a lawful sub-tenant, became a tenant upon the first respondent's tenancy determination.
  
  Damage to the Premises:
  This ground was dismissed by the trial court and upheld by the appellate court and the High Court. The appellants did not press this issue further in the Supreme Court.
  
  Bona Fide Need:
  The trial court dismissed this ground, and the appellate court and High Court upheld the dismissal. The appellants did not pursue this issue in the Supreme Court.
  
  Legal Provisions and Interpretation:
  - Section 12: Protects tenants from eviction if they pay or are willing to pay rent and comply with tenancy conditions.
  - Section 14: Protects sub-tenants who were lawfully sublet before February 1, 1973, allowing them to become direct tenants upon the main tenant's eviction.
  - Section 15: Prohibits subletting or licensing of premises after February 1, 1973, unless specified by contract or government notification.
  
  Conclusion:
  The Supreme Court upheld the appellate court's decision, emphasizing that the second respondent, a lawful sub-tenant before 1959, is protected under Section 14 and becomes a direct tenant upon the first respondent's eviction. The court dismissed the appeals, concluding that the appellants' grounds for eviction were unsubstantiated, particularly the claim of unlawful subletting and non-payment of rent. The judgment clarified the interpretation of relevant sections of the Act, reinforcing the protections for lawful sub-tenants.

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• 1999 (11) TMI 878
  
  Supreme Court dismissed the appeals on merits after condoning the delay. (Citation: 1999 (11) TMI 878 - SC)

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• 1999 (11) TMI 877
  
  The Supreme Court dismissed the appeal, stating that the question involved was covered against the appellant by a previous judgment in Government of India v. Madras Rubber Factory Ltd. (1995). No costs were awarded.

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• 1999 (11) TMI 876
  
  The Supreme Court dismissed the appeals as the issue was covered by a previous judgment in Union of India v. Delhi Cloth & General Mills Co. Ltd. No costs were awarded. (1999 (11) TMI 876 - SC Order)

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• 1999 (11) TMI 875
  
  Issues Involved:
  
  1. Levy of penalty under Section 271(1)(c) of the IT Act.
  2. Applicability of the Amnesty Scheme.
  3. Validity of revised returns filed under the Amnesty Scheme.
  4. Justification of penalty on estimated income.
  5. Contradiction in grounds for initiating penalty proceedings.
  
  Detailed Analysis:
  
  1. Levy of Penalty under Section 271(1)(c) of the IT Act:
  
  The main issue revolves around the levy of penalty under Section 271(1)(c) for the assessment years 1975-76 to 1980-81. The assessee argued that the revised returns filed should be considered under the Amnesty Scheme, which would exempt them from penalties. The AO did not accept this contention and levied penalties for all the years under consideration. The CIT(A) upheld the AO's decision, stating that the revised returns were filed after the concealment had been detected by the department.
  
  2. Applicability of the Amnesty Scheme:
  
  The assessee claimed benefits under the Amnesty Scheme, arguing that the revised returns filed after the completion of assessments should be considered under this scheme. The CIT(A) rejected this claim, noting that duplicate books of account were found during a search, indicating concealment of income. The Tribunal, however, considered whether there was actual detection of assets or income before the revised returns were filed. It was noted that the search did not result in the detection of cash or other valuables, and the duplicate books of account contained credit entries that were not necessarily indicative of concealed income.
  
  3. Validity of Revised Returns Filed under the Amnesty Scheme:
  
  For the assessment years 1975-76, 1976-77, and 1977-78, the Tribunal found that the revised returns should be accepted as amnesty returns. The Tribunal observed that the assessee had complied with the requirement of withdrawing the appeals and making the declaration and payment of tax on the declared income. The Tribunal noted that the search did not detect any specific concealed income, thus entitling the assessee to the benefits under the Amnesty Scheme for these years.
  
  4. Justification of Penalty on Estimated Income:
  
  For the assessment years 1978-79 and 1980-81, the Tribunal examined whether penalties could be justified on estimated income. For 1978-79, the AO had added Rs. 1,09,300 as undisclosed income based on unproved cash credits. The assessee later admitted this amount in the revised return. The Tribunal confirmed the penalty for this year, stating that the subsequent admission of income indicated concealment. For 1980-81, the assessment was made on an estimated income of Rs. 90,000 without a clear basis. The Tribunal canceled the penalty, noting that penalties should not be levied on estimated income without concrete evidence of concealment.
  
  5. Contradiction in Grounds for Initiating Penalty Proceedings:
  
  The assessee contended that the AO initially initiated penalty proceedings for furnishing inaccurate particulars of income but later levied penalties for concealment of income. The Tribunal found that for the assessment year 1978-79, the AO had not specified that the penalty was initiated for furnishing inaccurate particulars. Therefore, this contention did not apply to this year.
  
  Conclusion:
  
  The Tribunal allowed the appeals for the assessment years 1975-76, 1976-77, 1977-78, and 1980-81, canceling the penalties for these years. The appeal for the assessment year 1978-79 was dismissed, and the penalty was confirmed. The Tribunal emphasized that the benefits of the Amnesty Scheme should be interpreted rationally and not be denied merely due to the fact of a search, provided there was no detection of concealed income during the search.

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• 1999 (11) TMI 874
  
  Issues Involved:
  1. Addition on account of low household withdrawals.
  2. Deduction u/s 80HHC.
  3. Alternative deduction u/s 80-O.
  
  Summary:
  
  Issue 1: Addition on account of low household withdrawals

  The assessee contested the addition of Rs. 1,18,891 by the Assessing Officer (AO) for alleged inadequate household withdrawals. The tribunal found that no material evidence was discovered during the search to justify this addition. The AO's inference was based on a comparison of household expenses in different years, which was deemed insufficient. The tribunal concluded that the addition was made on surmises and conjectures, thus deleting the addition of Rs. 1,18,891.

  Issue 2: Deduction u/s 80HHC

  The AO disallowed the deduction u/s 80HHC of Rs. 84,36,746 in the block assessment. The tribunal clarified that the block assessment is meant to assess undisclosed income detected as a result of search, not to make a regular assessment. Since the assessee had already filed a return for the relevant assessment year and the issue of deduction u/s 80HHC was pending in regular assessment, it should not have been dealt with in the block assessment. The tribunal directed the AO to reduce the income determined in the block assessment by the amount assessed in the regular assessment, thereby deleting the disallowance of deduction u/s 80HHC from the block assessment.

  Issue 3: Alternative deduction u/s 80-O

  The assessee alternatively claimed deduction u/s 80-O. The tribunal examined whether the income received from Star TV for telecasting rights of films qualified for deduction u/s 80-O. It was determined that the telecasting rights did not constitute a patent, invention, model, design, secret formula, or similar property right, nor did it involve providing information concerning industrial, commercial, or scientific knowledge, experience, or skill. Consequently, the claim for deduction u/s 80-O was rejected.

  Conclusion:

  The appeal against the block assessment was allowed, and the appeal against the regular assessment was partly allowed.

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• 1999 (11) TMI 873
  
  The Karnataka High Court ruled that deduction u/s 80M is allowable on net dividends, not gross dividends, in accordance with the Income Tax Act. The tribunal's decision in favor of the revenue was upheld, and the case was disposed of with this ruling.

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• 1999 (11) TMI 872
  
  Issues Involved:
  1. Deduction of Rs. 7,50,000 on account of loan processing charges.
  2. Deletion of disallowance of Rs. 23,19,683 on account of interest and loan processing charges.
  
  Issue-wise Detailed Analysis:
  
  1. Deduction of Rs. 7,50,000 on Account of Loan Processing Charges:
  
  The first ground of appeal concerns the deduction of Rs. 7,50,000 for loan processing charges paid to HDFC and Citibank. The Assessing Officer disallowed this claim, arguing that these charges should be spread over the entire loan period as per the loan agreement terms, and since no loan repayment occurred during the relevant year, the expenditure had neither accrued nor crystallized.
  
  In contrast, the assessee argued that the Supreme Court's decision in India Cements Ltd. v. CIT [1966] 60 ITR 52 supports the claim that expenditure for raising loans is of a revenue nature, irrespective of the loan's term. The CIT(A) examined this precedent, noting that the Supreme Court had held such expenditures as revenue expenditure, incidental to the business, and not capital expenditure. The CIT(A) found that the facts of the assessee's case were similar to India Cements Ltd., where the expenditure was for securing the use of money for a certain period. Consequently, the CIT(A) directed the Assessing Officer to allow the deduction of Rs. 7,50,000.
  
  The Tribunal agreed with the CIT(A), noting that the learned Departmental Representative could not provide any authority against the CIT(A)'s view. Thus, the Tribunal confirmed the CIT(A)'s order, dismissing the first ground of appeal.
  
  2. Deletion of Disallowance of Rs. 23,19,683 on Account of Interest and Loan Processing Charges:
  
  The second ground of appeal involves the deletion of Rs. 23,19,683, which includes Rs. 19,19,683 debited to financial charges and Rs. 4,00,000 for loan processing charges. The Assessing Officer had disallowed these amounts as capital expenditure. The assessee argued that the Assessing Officer failed to consider Explanation 8 to Section 43(1) of the Act and CBDT Circular No. 461 dated 9-7-1986, which states that interest on borrowed funds constitutes the cost of borrowing, not the cost of the asset.
  
  The assessee contended that the loan was for additions to the existing hotel business, not a new project. The hotel business had already commenced, and the interest paid on borrowings for additions to the block of assets should be a permissible deduction. The CIT(A) accepted this contention, noting that the hotel business was a running concern, and the interest on borrowings was allowable as revenue expenditure. The CIT(A) also allowed the processing charges of Rs. 4,00,000 as revenue expenditure.
  
  The Tribunal considered the rival submissions and cited the Supreme Court's decision in State of Madras v. G.J. Coelho [1964] 53 ITR 186, which held that interest paid on borrowed capital for the acquisition or working of a plantation is allowable as a deduction. The Tribunal found the CIT(A)'s decision to allow the interest and processing charges justified and dismissed the second ground of appeal.
  
  Conclusion:
  
  The Tribunal dismissed the departmental appeal, confirming the CIT(A)'s orders on both grounds. The first ground regarding the deduction of Rs. 7,50,000 for loan processing charges was upheld based on the Supreme Court's precedent in India Cements Ltd. The second ground concerning the deletion of Rs. 23,19,683 was also upheld, supported by the Supreme Court's decision in State of Madras v. G.J. Coelho and other relevant judgments.

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• 1999 (11) TMI 871
  
  Issues involved: Penalty u/s 140A(3) for non-payment of self-assessment tax based on incorrect return and applicability of section 80VVA of the Income-tax Act.
  
  Summary:
  The appeal before the Appellate Tribunal ITAT Mumbai involved a dispute regarding the penalty levied u/s 140A(3) for non-payment of self-assessment tax by the assessee for the assessment year 1986-87, based on the incorrect return filed. The Assessing Officer contended that the assessee avoided payment of self-assessment tax by not considering section 80VVA, limiting set off of unabsorbed depreciation to 70% of gross income. The penalty was imposed for default in paying tax on the income determined by the Assessing Officer. The CIT(Appeals) upheld the penalty, leading to the appeal before the Tribunal.
  
  The assessee argued that self-assessment tax is payable only on the returned income, not on the corrected income by the Assessing Officer. The Tribunal interpreted that tax is payable based on the income required to be returned, not just the income returned. Ignorance of law or bona fide mistake must be proven by the assessee to avoid penalty. The Tribunal found that the assessee failed to provide sufficient reasons for non-payment of self-assessment tax, especially regarding the oversight of section 80VVA.
  
  Regarding the reduction of penalty, the Tribunal noted the incorrect application of penalty provisions by the Assessing Officer, as the penalty was levied @ 2% per month, contrary to the applicable provisions at the time of default. The Tribunal exercised discretion and reduced the penalty to Rs. 5,000 u/s 140A(3) for the assessment year 1986-87, finding it appropriate to meet the ends of justice. The appeal was partly allowed, considering the circumstances of the case.

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• 1999 (11) TMI 870
  
  Issues:
  1. Conflict between judgments in Ram Bali Rajbhar v. The State of West Bengal & Ors. and Pushpa v. Union of India & Ors.
  2. Consideration of representations made against the order of detention.
  3. Failure to constitute a fresh Advisory Board for considering a representation.
  4. Detention period and parole considerations.
  
  Conflict between Judgments:
  The Supreme Court addressed the doubt raised by a three-judge bench regarding the observations made in Ram Bali Rajbhar v. The State of West Bengal & Ors. and Pushpa v. Union of India & Ors. The Court found no conflict between the two judgments. It was concluded that the view expressed in Rajbhar's case laid down the correct law and did not require reconsideration. The Court noted that the detenu in Pushpa's case had made representations against the detention order, which were duly considered. Ultimately, the Court agreed that there was no area of conflict between the two judgments.
  
  Consideration of Representations:
  In the case at hand, the petitioner had made representations against the order of detention, which were considered by the detaining authority and the Advisory Board. Despite the rejection of these representations, the petitioner continued to challenge the detention order through multiple writ petitions. The Court observed that the petitioner's subsequent representation did not introduce any fresh material or events warranting a new consideration. Consequently, the rejection of the representation by the Delhi Administration was deemed justified, as there were no new grounds presented.
  
  Failure to Constitute a Fresh Advisory Board:
  The petitioner argued that the failure to constitute a fresh Advisory Board to consider a representation rendered the detention order invalid. However, the Court disagreed, emphasizing that since the petitioner had unsuccessfully challenged the detention order multiple times before, the subsequent representation lacked merit. The Court deemed the petitioner's actions as an attempt to file another writ petition without valid grounds, leading to the rejection of the representation by the Delhi Administration.
  
  Detention Period and Parole Considerations:
  Regarding the detenu's period of detention and subsequent release on parole, the Court acknowledged that the detenu had already spent about ten months in detention before being released on parole. Considering the substantial time that had elapsed since the detention order, the Court deemed it unjust to revoke the parole and require the detenu to serve the remaining two months of detention. Consequently, the Court decided that the detenu need not be taken back into custody to complete the remaining detention period, thereby dismissing the writ petition.
  
  In conclusion, the Supreme Court's judgment addressed the issues of conflicting judgments, the consideration of representations, the failure to constitute a fresh Advisory Board, and the detenu's detention period and parole considerations, providing detailed analysis and reasoning for each aspect of the case.

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• 1999 (11) TMI 869
  
  Issues Involved:
  1. Alleged wrongful transmission of shares.
  2. Alleged siphoning off of funds.
  3. Alleged employment of bogus and benami employees.
  4. Alleged mismanagement and oppression in the affairs of the company.
  
  Summary:
  
  1. Alleged Wrongful Transmission of Shares:
  The petitioner, a member of the Thakur group holding 20% shares, alleged that the second respondent engineered the wrongful transmission of 660 shares held by the deceased head of the Bhavnani group, suppressing a will that bequeathed the shares to Reshma Bakshi. The petitioner claimed this was done without proper agenda and against the protest of some directors. However, the respondents argued that the deceased died intestate, and the shares were transmitted to his legal heirs as per Article 44 of the articles of association. The Board found no evidence of the alleged will and concluded that the transmission was in accordance with the articles of association, thus not constituting oppression or mismanagement.
  
  2. Alleged Siphoning Off of Funds:
  The petitioner accused the second and third respondents of siphoning off company funds through fictitious employees and other means, claiming they pocketed significant amounts monthly. The respondents countered that the managing director, the petitioner's brother, would have known of any such siphoning, and no such complaints were made by him. The Board noted the lack of specific details and the absence of the managing director as a party to the proceedings, concluding that the allegations were unsubstantiated and motivated.
  
  3. Alleged Employment of Bogus and Benami Employees:
  The petitioner alleged that salaries were being drawn for non-existent employees and drivers, with the funds being pocketed by the respondents. The respondents explained that the company reimbursed directors for drivers' salaries to avoid higher costs of direct employment. The Board found this practice common and noted that the petitioner's own expenses were covered by the company, indicating a lack of bona fide in his claims.
  
  4. Alleged Mismanagement and Oppression:
  The petitioner sought various reliefs, including the appointment of a special officer and investigation into the company's affairs. The respondents argued that the petition was motivated by the petitioner's desire for a directorship, as evidenced by his previous demands for a functional role and complaints about not being made a director. The Board observed that the petition targeted only the second respondent, leaving out the managing director from the petitioner's group, indicating an ulterior motive. The Board emphasized that relief u/s 397/398 should aim to end acts of oppression/mismanagement, not serve oblique purposes, and dismissed the petition accordingly.

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