Home Case Index All Cases Income Tax Section Wise 2009 2009 (12) This

Law	-- All -- GST Income Tax Benami Property Customs Corporate Laws Securities / SEBI Insolvency & Bankruptcy FEMA Law of Competition PMLA Service Tax Central Excise CST, VAT & Sales Tax Wealth tax Indian Laws
Court	-- Any -- Supreme Court SC Orders / Highlights High Court Appellate Tribunal Tribunal Appellate authority for Advance Ruling Advance Ruling Authority National Financial Reporting Authority Competition Commission of India ANTI-PROFITEERING AUTHORITY Commission Central Government Board DISTRICT/ SESSIONS Court Commissioner / Appellate Authority Other
Citation	--Year-- 2025 2024 2023 2022 2021 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 1993 1992 1991 1990 1989 1988 1987 1986 1985 1984 1983 1982 1981 1980 1979 1978 1977 1976 1975 1974 1973 1972 1971 1970 1969 1968 1967 1966 1965 1964 1963 1962 1961 1960 1959 1958 1957 1956 1955 1954 1953 1952 1951 1950 Upto 1949 - -Volume- 1 2 3 4 5 6 7 8 9 10 11 12 -
Landmark	Nil - N/A Referred in >= 2 Cases Referred in >= 4 Cases Referred in >= 5 Cases Referred in >= 10 Cases Referred in >= 15 Cases Referred in >= 25 Cases Referred in >= 50 Cases Referred in >= 100 Cases
Order by	TMI Citation Date of Decision

Advanced Search Options

Case Laws

Showing 21 to 40 of 781 Records

• 2009 (12) TMI 1053
  
  Issues Involved:
  1. Challenge to the interim award under Section 34 of the Arbitration and Conciliation Act, 1996.
  2. Maintainability of the main original petition.
  3. Execution of the interim award.
  4. Admission of liability and its implications on the interim award.
  5. Distinction between adjustment, set-off, and counter-claim.
  
  Detailed Analysis:
  
  1. Challenge to the Interim Award under Section 34 of the Arbitration and Conciliation Act, 1996:
  The Petitioner challenged an interim award passed by the Arbitrator directing them to deposit Rs. 56,63,990/-. The Arbitrator concluded that there was an admission by the Petitioner regarding this amount. The Petitioner contended that the Arbitrator's power under Section 31(6) does not include passing an interim award on admission akin to Order XII, Rule 6, Code of Civil Procedure. This contention was rejected, with the court noting that Section 31(6) allows for interim awards and that such power is intended to expedite dispute resolution. The court referenced various legal precedents and scholarly opinions to support the broad interpretation of Section 31(6).
  
  2. Maintainability of the Main Original Petition:
  The Respondent filed applications to reject the main original petition as not maintainable and to permit withdrawal of the amount deposited by the Petitioner. The court found the petition maintainable and proceeded to hear it on merits, despite the absence of a formal application from the Respondent to reopen the case after an ex parte order was passed.
  
  3. Execution of the Interim Award:
  The Petitioner sought an interim injunction to restrain the Respondent from executing the award. The court initially retained the deposited amount until the Arbitrator passed the final award. Later, the court allowed the Respondent to withdraw the amount upon furnishing a Bank Guarantee, as the interim award was upheld.
  
  4. Admission of Liability and Its Implications on the Interim Award:
  The Petitioner admitted liability of Rs. 56,63,990/- in their Statement of Defence and Counter Claim. The court found this admission clear, unequivocal, and sufficient to justify the interim award. The Arbitrator did not act blindly but considered various factors, including contract clauses and relevant documents, before passing the interim award.
  
  5. Distinction Between Adjustment, Set-Off, and Counter-Claim:
  The Petitioner argued that their claim of adjustment should prevent the interim award. The court distinguished between adjustment, set-off, and counter-claim, noting that the Petitioner's adjustment did not negate the clear admission of liability. The court held that the distinction had no bearing on the interim award, which was based on the admitted amount.
  
  Conclusion:
  The main original petition challenging the interim award was dismissed. The Respondent was allowed to withdraw the deposited amount upon furnishing a Bank Guarantee. The court found the interim award justified and not arbitrary, thus rejecting all contentions raised by the Petitioner.

  ---

• 2009 (12) TMI 1052
  
  Issues Involved:
  1. Partial disallowance of commission paid to the sole selling agent by the assessee.
  2. Deletion of substantial portion of the disallowance by the CIT(A).
  
  Summary:
  
  Issue 1: Partial disallowance of commission paid to the sole selling agent by the assessee.

  The assessee contested the CIT(A)'s decision to sustain a partial disallowance of Rs.7,50,482/- out of the commission paid to its sole selling agent, M/s. L.G. & Doctors Associates Pvt. Ltd. ("LGDA"). The assessee argued that the sole selling agency agreement, executed on 25-10-1988, was genuine and had been consistently accepted by the department in previous and subsequent assessment years. The assessee maintained that the services rendered by LGDA were legitimate business expenses. The Tribunal found that the Revenue had not provided sufficient evidence to discredit the agreement or the services rendered by LGDA. Consequently, the Tribunal deleted the partial disallowance of Rs.7,50,482/- sustained by the CIT(A).

  Issue 2: Deletion of substantial portion of the disallowance by the CIT(A).

  The Revenue appealed against the CIT(A)'s decision to delete a substantial portion of the disallowance made by the assessing authority, which initially disallowed Rs.1,27,57,505/-. The CIT(A) found that LGDA had rendered sufficient services to justify the commission, except for Rs.7,50,482/- related to direct sales made by the assessee to eight parties. The Tribunal upheld the CIT(A)'s decision, noting that the sole selling agency agreement had been consistently accepted in previous and subsequent assessments. The Tribunal concluded that the Revenue had not met the burden of proof to discredit the agreement or the services rendered by LGDA. Therefore, the Tribunal dismissed the Revenue's appeal.

  Conclusion:

  The appeal filed by the assessee is allowed, and the appeal filed by the Revenue is dismissed.

  ---

• 2009 (12) TMI 1051
  
  Issues involved: Appeal against order u/s.263 by Commissioner of Income-tax regarding excess deduction under section 80JJAA for Assessment Year 2006-07.
  
  The Appellate Tribunal ITAT Bangalore heard an appeal by the assessee against the order passed u/s.263 by the Commissioner of Income-tax, Bangalore -III, Bangalore for the Assessment Year 2006-07. The Commissioner had noted that the assessee had paid additional wages of Rs.60,30,143 and was eligible for a deduction of 30% u/s 80JJAA of the Income tax Act, 1961, amounting to Rs.18,09,043. However, an excess deduction of Rs.32,46,618 was allowed, leading to a direction to disallow the excess deduction of Rs.14,37,575. The Commissioner held the Assessing Officer's order as erroneous and prejudicial to the interests of revenue.
  
  In response, the assessee contended that it was entitled to the claim of 30% deduction and had claimed only that amount, refuting the existence of any excess deduction. The assessee specified deductions claimed for different assessment years and argued that as per section 80JJAA, a deduction equal to 30% of additional wages paid to regular workers was permissible. The Tribunal noted a previous order in a similar case where the Tribunal had ruled in favor of the assessee. Consequently, the appeal by the assessee was allowed, overturning the Commissioner's order.
  
  In conclusion, the Appellate Tribunal ITAT Bangalore allowed the appeal by the assessee against the order u/s.263 by the Commissioner of Income-tax, setting aside the disallowance of excess deduction under section 80JJAA for the Assessment Year 2006-07.

  ---

• 2009 (12) TMI 1050
  

  Claim for Restoration of possession - issuance of certificate - predecessor-in-interest of the appellants claimed to be protected tenants and sought ownership certificates to become full owners of the suit land - Orders passed without following the procedure prescribed under the Andhra Pradesh (Telangana Area) Tenancy and Agricultural Lands Act, 1950 ("The Act 1950") - Validity of the tenancy certificate u/s 38-E (2) - HELD THAT:- This judgment and order of the High Court also attained finality as it was not challenged by the respondents any further. in our view, the question of reconsideration of the validity of the tenancy certificate u/s 38-E (2) so far as the appellant nos. 1& 3 are concerned, could not arise in any subsequent proceedings whatsoever. More so, the entitlement of the said appellant nos. 1&3 to claim restoration of possession also cannot be reopened/questioned, as their entitlement to that effect had attained finality as the judgment and order of the High Court, wherein, their right to claim restoration of possession had been upheld, was not challenged by the respondents any further.

  Thus, it was not permissible for the High Court to re-open the issue in respect of all the appellants as to whether they were entitled for making the applications for restoration of possession. There can be no doubt that once a protected tenant gets a certificate of ownership u/s 38-E(2) of the Act 1950, he has a right to apply for restoration of possession to him if he has been dispossessed. The protected tenant has a right to ask for summary eviction of trespasser.

  The High Court ought to have taken into consideration as under what circumstances the respondents had been claiming their right to object to the grant of certificates to the appellants and, as to whether the alleged sale deed which had never been produced in any Court, and which was admittedly in contravention of Section 47 of the Act, could give any cause of action to the respondents as, the transaction itself remains inconsequential and ineffective rather, void ab initio. The respondents also could not explain as since what date or year they had been in possession of the land in dispute.

  Before the RDO, the case of the respondents was that they had been in possession of suit land in pursuance of decree of Civil Court passed in OS No.5/1963. The Order of the RDO reveals that the respondents had claimed before him that they were in possession of the suit land since Ist June, 1950. The High Court in its judgment has taken note of the pleadings taken by the respondents that they had purchased the suit land from original pattedar Smt. Ayesha Begum in the year 1954. However, it is not stated therein, that they had been put in possession of said land. In the impugned judgment, the High Court has further taken note of the pleadings taken by respondents that Smt. Ayesha Begum, the original land holder offered to sell the entire land to the father of the respondents in the year 1962 and it was so purchased by him for valuable consideration.

  From the order of Appellate Authority, it is evident that the pleadings before Appellate Authority had been that the respondents were in continuous possession of suit land measuring 17 acres and 20 guntas since last 50 years. The pleadings taken by predecessor-in-interest of the respondents in earlier writ petition decided, that they purchased the said land in the year 1955, for valuable consideration. While deciding the case after remand, the RDO in its judgment and order has taken note of the pleadings taken by respondents that the father of the respondents purchased the said land from Smt. Ayesha Begum in the year 1965.

  Thus, it is evident that respondents even today are not aware as to what is their case exactly and on what basis they claim the relief. The copy of alleged sale deed or agreement to sell has never been produced before any Court or Authority. It becomes well nigh, impossible to determine as to whether the predecessor-in-interest of the respondents ever purchased the suit property and even if it was so, admittedly, the transaction was void being in contravention of Section 47 of the Act 1950. More so, at the time of argument it was pointed out that respondents have entered into compromise with appellant no.3 in the year 2003 and a rectification deed had been prepared.

  This is an indication that no valid title had ever passed in favour of respondents, otherwise there was no occasion for them to enter into a compromise with appellant no.3.

  In such a fact-situation the court is under an obligation to do substantial justice even if there are some technical points involved in the case. The Act 1950, being beneficial legislation is to be construed liberally and rights of the tenants are required to be protected.

  Hence, the appeal stands allowed and the judgment and order of the High Court is set aside.

  Both the applications for substitution of legal representatives/lateral descendants of deceased appellant No.1- Edukanti Kistamma; and deceased Lr.No. iv of deceased appellant no.2 are allowed.

  ---

• 2009 (12) TMI 1049
  
  Issues involved: Disallowance of brokerage expenses, Addition of unexplained cash credits under Section 68, Disallowance of interest on cash credits, Disallowance of interest expenses, Disallowance of excess payment of interest, Disallowance of certain expenses.
  
  Disallowed Brokerage Expenses: The ITAT Ahmedabad upheld the assessee's appeal against the disallowance of brokerage expenses, citing a previous decision in the assessee's favor for an earlier assessment year. The Tribunal found that the genuineness of the claim was established, directing the assessing authority to allow the entire amount, leading to the deletion of the disallowance. The decision was based on the Tribunal's earlier ruling, and the disallowance of brokerage expenses was deleted for the relevant assessment year.
  
  Addition of Unexplained Cash Credits: The ITAT confirmed the addition of Rs.7,25,000 as unexplained cash credits under Section 68. Despite technical compliance by the assessee in explaining the nature of the cash credits, the Tribunal found that the resources available with the creditors to provide the deposits were not adequately explained. The Tribunal emphasized the importance of demonstrating the creditor's ability to provide the funds, beyond mere technical details, and upheld the addition of unexplained cash credits.
  
  Disallowance of Interest on Cash Credits: The disallowance of interest amounting to Rs.1,32,543 related to the cash credits added under Section 68 was confirmed by the ITAT. As the addition of cash credits was upheld, the consequential disallowance of interest was also confirmed by the Tribunal.
  
  Disallowance of Interest Expenses: The ITAT remitted the matter back to the assessing authority regarding the disallowance of Rs.1,63,500 against interest expenses for cash credits relating to the assessment year 2001-2002. The Tribunal directed a reexamination to determine the proportionate deduction available to the assessee based on the credits accepted as genuine by the Tribunal.
  
  Disallowance of Excess Payment of Interest: The ITAT deleted the disallowance of Rs.1,06,971 as excess payment of interest, noting that the differential rate of 2% in comparison with the bank rate did not warrant a case against the assessee. The Tribunal considered prevailing money market conditions and creditworthiness, concluding that the differential rate did not justify the disallowance.
  
  Disallowance of Certain Expenses: The ITAT dismissed the appeal against the disallowance of 20% of expenses like vehicle and petrol expenses, telephone expenses, and depreciation on scooter and pager. The Tribunal found no grounds to interfere with these disallowances, leading to the dismissal of this ground of appeal.
  
  Outcome: The ITAT partly allowed the appeal filed by the assessee, with different decisions on each issue raised in the appeal.

  ---

• 2009 (12) TMI 1048
  
  Legal Judgment: Supreme Court of India dismissed civil appeals after hearing counsel for the appellant. Delay was condoned. (Citation: 2009 (12) TMI 1048 - SC Order)

  ---

• 2009 (12) TMI 1047
  
  Issues Involved:
  1. Detailed verification of agricultural expenses.
  2. Examination of household expenses and other business income.
  3. Jurisdiction of CIT u/s 263 without prior notice.
  
  Summary:
  
  1. Detailed Verification of Agricultural Expenses:
  The assessee filed a return declaring total income, including agricultural income, which was processed u/s 143(1) and later assessed u/s 143(3). The CIT issued a show-cause notice u/s 263, proposing action due to low agricultural expenses claimed by the assessee. The assessee argued that all details were submitted and examined by the Assessing Officer (A.O.), and the assessment order should not be disturbed. The CIT, however, found the expenses unusually low and required detailed verification, citing a precedent from ITAT Ahmedabad.
  
  2. Examination of Household Expenses and Other Business Income:
  The CIT observed that the A.O. did not adequately verify the assessee's household expenses, income from a bar cum restaurant, and investments in land. The CIT noted discrepancies in the household expenses and the low net profit from the restaurant business, suggesting that the A.O. did not apply due diligence. The CIT also questioned the valuation of investments and potential wealth tax liability, which were not examined by the A.O.
  
  3. Jurisdiction of CIT u/s 263 Without Prior Notice:
  The assessee contended that the CIT u/s 263 raised issues not mentioned in the initial notice, which is beyond the CIT's jurisdiction. The assessee cited several judicial precedents to support the argument that the A.O. had examined all relevant details, and the CIT could not revise the assessment based on a change of opinion. The Tribunal found that the A.O. had indeed examined the agricultural income and expenses, and the CIT's action was based on a change of opinion, which is not permissible.
  
  Conclusion:
  The Tribunal concluded that the assessment framed by the A.O. was neither erroneous nor prejudicial to the interest of revenue. Therefore, the order passed by the CIT u/s 263 was cancelled, and the appeal of the assessee was allowed.

  ---

• 2009 (12) TMI 1046
  
  The Calcutta High Court directed the Commissioner of Customs to complete proceedings and pass an adjudication order within six months regarding the revocation of a Customs House Agent's license. The petitioner is not allowed to seek adjournment, and the suspension order will remain in place until the adjudication order is issued.

  ---

• 2009 (12) TMI 1045
  
  The Supreme Court dismissed the appeal stating that the issue raised was already settled in previous cases. The Court held that statutory charges for sales tax dues have precedence over mortgages created in favor of banks. The appeal was dismissed, and parties were left to bear their own costs.

  ---

• 2009 (12) TMI 1044
  
  Issues involved: Interpretation of deduction u/s 80IA for bus shelters; Delay in tax deposit
  
  Interpretation of deduction u/s 80IA for bus shelters:
  The High Court of Calcutta considered the substantial question of law regarding the eligibility of bus shelters for deduction u/s 80IA of the Income-tax Act, 1961. The court questioned whether the Income-tax Appellate Tribunal erred in allowing the deduction for bus shelters, emphasizing that they may not qualify as infrastructural facilities or form an integral part of the project as required by the provisions of Section 80IA. The court admitted the appeal for further hearing on this specific point.
  
  Delay in tax deposit:
  Another issue raised was the delay in depositing the tax amount, which was approximately one month. The court determined that this issue pertains to a question of fact rather than a question of law. The Act itself provides power for dealing with late deposits, and as such, the court decided not to formulate any specific point on this matter.
  
  The court directed the issuance of a notice to the respondent and instructed the preparation and filing of the paper book after the Christmas vacation. Parties were granted liberty to mention for enlistment in the list, and all parties were required to act on a xerox signed copy of the court's order.

  ---

• 2009 (12) TMI 1043
  
  Issues involved: The judgment involves a writ petition challenging an order rejecting an application in an appeal related to duty and penalty under Central Excise Act, 1944.
  
  Details of the judgment:
  
  Issue 1: Allegation of failure to utilize imported material for conversion into MS ingots
  The petitioner, engaged in the manufacture of Mild steel ingots, availed benefits under specific notifications for import. A show cause notice was issued alleging failure to utilize imported iron scrap for conversion into MS ingots. The 1st respondent confirmed duty, penalty, and interest under relevant sections of the Central Excise Act, 1944, along with personal penalties on the Managing Director and Director of the Company.
  
  Issue 2: Appeal and application for waiver of pre-deposit
  The petitioners appealed to the 2nd respondent Tribunal against the order of the 1st respondent and applied for a waiver of pre-deposit of duty and penalty. Despite the counsel's absence due to ill-health, the Tribunal ordered the deposit of the entire duty and a percentage of the penalty as a condition for entertaining the appeal. The petitioner's application for recall of this order was rejected.
  
  Judgment:
  Considering the circumstances and the absence of the petitioner's counsel during crucial hearings, the High Court directed the petitioners to deposit 50% of the duty and 10% of the penalty within three weeks. Upon such deposit, the Tribunal was instructed to entertain the appeal and proceed accordingly. Failure to make the deposit would result in the dismissal of the appeal. No costs were awarded in this matter.

  ---

• 2009 (12) TMI 1042
  
  Issues involved: Unfair trade practices, violation of regulations, fraudulent conduct in cornering shares in an IPO, imposition of penalties and disgorgement of unlawful gains.
  
  Unfair Trade Practices: The appellant was found guilty of unfair trade practices related to cornering shares in an IPO. The Securities and Exchange Board of India (SEBI) debarring the appellant from accessing the securities market for 45 days and directing him to disgorge the unlawful gain made, along with imposing a monetary penalty. The appellant financed applications of employees of the issuer company, received shares meant for employees, and sold them for a windfall gain, violating regulations 3(c) and 4(1) of the SEBI Act. The appellant's defense that the financing was legitimate was rejected, leading to the penalties imposed.
  
  Fraudulent Conduct in Cornering Shares: The appellant financed applications of 11 employees for share allotment from the quota reserved for them in an IPO. The employees transferred shares to the appellant's demat account, which he sold for a substantial profit. The appellant's actions were deemed fraudulent as he circumvented rules by using employees as conduits to corner shares, depriving genuine employees of their entitlement. The appellant's deceitful conduct was found to be an unfair trade practice, violating regulations and leading to the imposition of penalties.
  
  Imposition of Penalties and Disgorgement: The SEBI imposed penalties on the appellant for fraudulent conduct in cornering shares meant for employees. The appellant was directed to disgorge the unlawful gains made, totaling a specified amount including interest. Disgorgement is a remedy to prevent wrongdoers from benefiting from illegal acts, ensuring they do not profit unjustly. The penalties imposed were upheld, with the appellant failing to convince the tribunal that the penalties should be reduced based on the closing price of shares on the day of listing.
  
  Judgment Outcome: Both appeals filed by the appellant were dismissed, with no order as to costs. The tribunal upheld the penalties imposed by SEBI and the adjudicating officer, emphasizing the fraudulent conduct in cornering shares and the necessity of disgorgement to prevent unjust enrichment from illegal activities. The appellant's actions were deemed to be in violation of regulations and constituted unfair trade practices, leading to the dismissal of the appeals.

  ---

• 2009 (12) TMI 1041
  

  Application for grant of anticipatory bail - Forgery - offences punishable under Sections 420, 467, 468, 471 and 120B Indian Penal Code - HELD THAT:- We are of the view that the role of the Respondent No. 1 in the entire episode did not entitle him to the relief of Anticipatory Bail, much less a blanket order of bail. However, that is now a closed chapter. But what is of relevance is whether the High Court should have worded its order in such a way that it could be interpreted to mean, as has been done by all concerned, that the Respondent No. 1 was not required to even appear and surrender before the Court during the entire investigation stage and the trial. Taking advantage of the same, the Respondent No. 1 has successfully avoided the Court from the very initial stage of investigation and even the trial. Such kind of an order is not contemplated u/s 438 Cr.P.C. as has been repeatedly explained by this Court. The said position has been clearly enunciated in Adri Dharan Das's case [2005 (2) TMI 817 - SUPREME COURT].

  Section 438 Cr.P.C. contemplates arrest at the stage of investigation and provides a mechanism for an accused to be released on bail should he be arrested during the period of investigation. Once the investigation makes out a case against him and he is included as an accused in the charge-sheet, the accused has to surrender to the custody of the Court and pray for regular bail. On the strength of an order granting Anticipatory Bail, an accused against whom charge has been framed, cannot avoid appearing before the trial court. If what has been submitted on behalf of the appellant that the Respondent No. 1 has never appeared before the trial court is to be accepted, it will lead to the absurd situation that charge was framed against the accused in his absence, which would defeat the very purpose of Sub-section (2) of Section 240 Cr.P.C.

  Thus, the order of the High Court dated 3rd July, 2006, is modified to the extent that the Respondent No. 1 shall surrender before the Trial Court forthwith and pray for regular bail and the Trial Court shall dispose of the same on merits, in accordance with law, before proceeding further with the trial.

  The appeal is allowed to the above extent.

  ---

• 2009 (12) TMI 1040
  
  Issues Involved:
  1. Invocation of Section 9 of the Arbitration and Conciliation Act, 1996.
  2. Existence and enforcement of the arbitration clause in the Joint Venture Agreement (JVA).
  3. Compliance with pre-arbitration stages.
  4. Distribution rights and non-compete clauses in various agreements.
  5. Alleged breach of contractual obligations and fiduciary duties.
  6. Interim injunction against the respondent from distributing Verorab.
  7. Application of the Indian Partnership Act, 1932 and the Indian Contract Act, 1872.
  8. Conduct of the parties and its impact on equitable relief.
  9. Interpretation of commercial contracts.
  10. Public interest and market competition considerations.
  
  Detailed Analysis:
  
  1. Invocation of Section 9 of the Arbitration and Conciliation Act, 1996:
  The petitioner invoked Section 9 of the Arbitration and Conciliation Act, 1996, seeking an interim measure of protection by way of an interim injunction to restrain the respondent from distributing Verorab. The court considered the urgency and granted ad interim relief in terms of prayer (a) on 16.10.2009.
  
  2. Existence and Enforcement of the Arbitration Clause in the JVA:
  The JVA dated 22nd April 1998 contained an arbitration clause stipulating that any dispute arising out of or in connection with the agreement shall be resolved through arbitration under the Rules of Conciliation and Arbitration of the International Chamber of Commerce, to be held in London, England.
  
  3. Compliance with Pre-Arbitration Stages:
  The court noted that the compliance with pre-arbitration stages could be examined at a later stage. The basic requirement of the existence of the arbitration agreement and the dispute between the parties arising out of the same was deemed sufficient to consider the petitioner's case for urgent relief.
  
  4. Distribution Rights and Non-Compete Clauses in Various Agreements:
  Several agreements were executed between the parties, including the JVA, Shareholders Agreement, Marketing and Distribution Agreements, and a Licence and Technical Collaboration Agreement. These agreements contained clauses related to distribution rights and non-compete obligations. The petitioner argued that the respondent's distribution of Verorab violated these clauses.
  
  5. Alleged Breach of Contractual Obligations and Fiduciary Duties:
  The petitioner alleged that the respondent's distribution of Verorab constituted a breach of the JVA and other related agreements, as well as a violation of fiduciary duties. The court emphasized the importance of trust, good faith, and cooperation in joint ventures and partnerships, and held that the respondent's actions were contrary to these principles.
  
  6. Interim Injunction Against the Respondent from Distributing Verorab:
  The court granted an interim injunction restraining the respondent from distributing Verorab, based on the prima facie case made out by the petitioner. The court held that the respondent's distribution of Verorab was a rival and competing business that affected the petitioner's business and created confusion in the market.
  
  7. Application of the Indian Partnership Act, 1932 and the Indian Contract Act, 1872:
  The court referred to various provisions of the Indian Partnership Act, 1932, including Sections 9, 11, 16, 17, 36, and 54, and Section 27 of the Indian Contract Act, 1872. The court held that partners are bound to carry on the business of the firm to the greatest common advantage and not to engage in competing business without express permission.
  
  8. Conduct of the Parties and Its Impact on Equitable Relief:
  The court considered the conduct of the parties while granting the injunction. The court held that the respondent's conduct of starting a rival business without express or implied consent from the petitioner and the company was not permissible and affected the business of the joint venture.
  
  9. Interpretation of Commercial Contracts:
  The court emphasized the need to interpret commercial contracts as a whole, considering the object and purpose of the agreements. The court held that the clauses related to distribution rights and non-compete obligations should be read in the context of the entire agreement and the relationship between the parties.
  
  10. Public Interest and Market Competition Considerations:
  The court rejected the respondent's argument that distributing Verorab was in the public interest due to a shortage of anti-rabies vaccines in the market. The court held that the dispute was a commercial transaction between the parties and did not involve public interest considerations.
  
  Conclusion:
  The court confirmed the interim injunction granted on 16.10.2009, restraining the respondent from distributing Verorab until the constitution of the Arbitral Tribunal and eight weeks thereafter. The court held that the petitioner had made out a prima facie case for the injunction and that the balance of convenience and equity tilted in favor of the petitioner. All points were kept open for further consideration by the Arbitral Tribunal.

  ---

• 2009 (12) TMI 1039
  
  Issues involved:
  The plaintiff's appeal against the District Judge's decision reversing the trial Court's decree for permanent injunction on a land dispute.
  
  Details of the judgment:
  
  Issue 1: Entitlement to injunction
  - The plaintiff, widow of Avtar Singh, filed for permanent injunction against interference in land ownership.
  - Defendants denied Avtar Singh's loan from the Bank and claimed the plaintiff's liability.
  - Plaintiff presented evidence, trial Court decreed in her favor, but the District Judge reversed the decision.
  - Appellant raised questions on the District Judge's findings being contrary to pleadings.
  - Appellant's counsel argued that evidence beyond pleadings cannot be considered for judgment.
  - District Judge's decision found to be against the appellant due to lack of proof of loan availed by Avtar Singh.
  
  Issue 2: Admissibility of documents
  - Appellant questioned the liability based on photostat copies without proper execution proof.
  - Trial Court noted the absence of original mortgage deed and attesting witnesses.
  - Appellant cited legal precedents on the admissibility of documents and proof of execution.
  - Appellant's counsel emphasized the need for primary evidence as per the Indian Evidence Act.
  - District Judge's decision was set aside as it did not adhere to the legal requirements for document admissibility.
  - Appellant's appeal allowed, and trial Court's judgment and decree restored with costs.

  ---

• 2009 (12) TMI 1038
  
  Issues Involved:
  1. Jurisdiction of the court under Section 9 of the Arbitration and Conciliation Act, 1996.
  2. Rights of non-parties to an arbitration agreement in Section 9 proceedings.
  3. Validity of the Development Agreement and related resolutions.
  4. Authority of the Society's General Body decisions.
  5. Appointment of a Court Receiver and interim measures.
  
  Detailed Analysis:
  
  1. Jurisdiction of the court under Section 9 of the Arbitration and Conciliation Act, 1996:
  The court examined whether it had jurisdiction to pass orders under Section 9 of the Arbitration and Conciliation Act, 1996, especially against individuals who were not parties to the arbitration agreement. The court noted that Section 9 empowers a party to an arbitration agreement to seek interim measures from the court, and such measures can be sought before, during, or after the arbitration proceedings but before the enforcement of the arbitral award. The court emphasized that its power under Section 9 is broad and not constrained by the Code of Civil Procedure, allowing it to pass orders for the preservation, interim custody, or sale of any goods, securing the amount in dispute, or any other interim measures of protection as deemed just and convenient.
  
  2. Rights of non-parties to an arbitration agreement in Section 9 proceedings:
  The appellants argued that they could not be made parties to the Section 9 petition as they were not parties to the arbitration agreement. The court held that while Section 9 can be invoked only by a party to the arbitration agreement, it does not limit the court's jurisdiction to pass orders only against parties to the arbitration agreement or proceedings. The court can pass orders affecting third parties if they are claiming under a party to the arbitration agreement. The court cited the Kerala High Court's decision in Shoney Sanil v. Coastal Foundations (P) Ltd., which held that Section 9 could be invoked against third parties claiming under a party to the arbitration agreement.
  
  3. Validity of the Development Agreement and related resolutions:
  The appellants challenged the Development Agreement and the related resolutions passed by the Society's General Body. The court noted that the General Body had unanimously decided to redevelop the building and had appointed the respondent as the developer. These decisions were not challenged until the filing of the Section 9 petition. The court emphasized that the majority decision of the General Body binds all members, including the appellants, and that the appellants' challenge to the Development Agreement's terms and conditions could not negate the binding effect of the General Body's decisions.
  
  4. Authority of the Society's General Body decisions:
  The court reiterated that once a person becomes a member of a cooperative society, they lose their individuality and must abide by the society's decisions. The General Body's decisions are supreme and bind all members. The appellants, being members of the Society, were bound by the General Body's decision to redevelop the property and appoint the respondent as the developer. The court cited the Supreme Court's decision in Daman Singh v. State of Punjab, which held that a member of a cooperative society has no independent rights except those given by the statute and bye-laws.
  
  5. Appointment of a Court Receiver and interim measures:
  The court upheld the appointment of a Court Receiver to take possession of the property and hand over vacant possession to the respondent for redevelopment. The court found it just and convenient to appoint the Court Receiver and pass further orders for the preservation, protection, and improvement of the property. The court noted that the respondent had already incurred substantial expenses and that the project was stalled due to the appellants' obstruction. The court emphasized that the relief sought by the respondent did not permanently take away the appellants' rights in their flats, as they would be accommodated in newly constructed flats upon redevelopment.
  
  Conclusion:
  The court dismissed the appeal, finding no merit in the appellants' arguments. It held that the appellants were bound by the General Body's decisions and that the court had jurisdiction to pass interim measures under Section 9, even affecting non-parties to the arbitration agreement if they were claiming under a party to the agreement. The court affirmed the appointment of a Court Receiver and the interim measures granted by the learned Single Judge.

  ---

• 2009 (12) TMI 1037
  
  Issues Involved:
  1. Characterization of grant received from NDDB as capital or revenue receipt.
  2. Allowability of depreciation on assets transferred from NDDB.
  3. Treatment of lease rent expenses as capital or revenue expenditure.
  4. Levy of interest under sections 234B and 234D of the IT Act.
  
  Detailed Analysis:
  
  1. Characterization of Grant Received from NDDB:
  The primary issue was whether the grant of Rs. 24,44,38,406 received by the assessee from NDDB should be treated as a capital receipt or a revenue receipt. The assessee argued that the grant was capital in nature, intended for research and development, and should be treated as an earmarked corpus. The Assessing Officer (AO) treated the grant as a revenue receipt, arguing that it was given for research activities integral to the assessee's business. The CIT(A) upheld the AO's decision, stating that the grant was for normal business activities and hence revenue in nature. The Tribunal, however, concluded that the grant was capital in nature, emphasizing the specific conditions attached to its use, such as investing the principal amount in long-term financial instruments and using only the interest for research and development. The Tribunal referenced the Supreme Court's decision in CIT vs. Ponni Sugars & Chemicals Ltd., which emphasized the purpose of the subsidy over the timing of its receipt.
  
  2. Allowability of Depreciation on Assets Transferred from NDDB:
  The assessee claimed depreciation on assets worth Rs. 5,55,61,594 transferred from NDDB. The AO and CIT(A) denied the depreciation, stating that the cost of the assets was entirely borne by NDDB, making the actual cost nil. The Tribunal noted that the issue was not approved by the Committee on Disputes (COD) and hence declined to adjudicate this ground.
  
  3. Treatment of Lease Rent Expenses:
  The assessee paid lease rent expenses of Rs. 7,84,704 for leasehold land at Narela, which the AO and CIT(A) treated as capital expenditure. The assessee argued that the lease rent should be considered a revenue expenditure. The Tribunal agreed with the assessee, referencing the Gujarat High Court's decision in CIT vs. Sun Pharmaceuticals Ltd., which distinguished between lease rent paid for using land (revenue expenditure) and acquiring land (capital expenditure). The Tribunal concluded that the lease rent paid was for using the land and thus should be treated as revenue expenditure.
  
  4. Levy of Interest under Sections 234B and 234D:
  The assessee contested the levy of interest under sections 234B (Rs. 3,88,48,074) and 234D (Rs. 2,74,440) of the IT Act. The Tribunal did not adjudicate these grounds due to the absence of COD approval.
  
  Conclusion:
  The Tribunal allowed the appeal partly. It held that the grant received from NDDB was a capital receipt and should not be taxed as revenue. It also ruled that the lease rent expenses were revenue in nature and hence allowable. The issues related to depreciation and interest under sections 234B and 234D were not adjudicated due to the lack of COD approval.

  ---

• 2009 (12) TMI 1036
  
  Issues Involved:
  
  1. Taxability of non-compete fees.
  2. Application of Section 263 of the Income Tax Act.
  3. Examination of valuation aspects by the Assessing Officer.
  4. Principles of natural justice and application of mind by the Assessing Officer.
  
  Detailed Analysis:
  
  1. Taxability of Non-Compete Fees:
  
  The Assessee received Rs. 9 crores as non-compete fees and included this amount in its computation of total income while claiming it as a capital receipt, which is non-taxable. The Assessee supported this claim with case laws, including the Special Bench decision in Saurabh Srivastava v. Dy. CIT and Supreme Court decisions in Gillanders Arbuthnot & Co. Ltd. v. CIT and CIT v. Best & Co. (P) Ltd. The Assessing Officer, after issuing a show-cause notice and considering the Assessee's detailed submissions, accepted the Assessee's claim, treating the non-compete fees as a capital receipt. The Tribunal noted that the view taken by the Assessing Officer was supported by several Tribunal decisions, including Alfa Laval (I) Ltd. and Gomti Credits (P) Ltd., and was further vindicated by the Special Bench decision in Saurabh Srivastava.
  
  2. Application of Section 263 of the Income Tax Act:
  
  The Commissioner invoked Section 263, arguing that the Assessing Officer's order was erroneous and prejudicial to the interests of the revenue due to the non-taxation of the Rs. 9 crores non-compete fees. The Tribunal, however, observed that the Assessing Officer had duly applied his mind to the issue and reached a legally acceptable conclusion. The Tribunal emphasized that when an Assessing Officer adopts one of the two permissible views in law, the order cannot be deemed erroneous merely because the Commissioner disagrees with it. This principle was supported by the Supreme Court decisions in CIT v. Max India Ltd. and Malabar Industrial Co. Ltd. v. CIT.
  
  3. Examination of Valuation Aspects by the Assessing Officer:
  
  The Commissioner contended that the Assessing Officer ignored the valuation aspect of the non-compete fees. The Tribunal found this claim incorrect, noting that the Assessing Officer had referred the valuation of land, building, and machinery to the Departmental Valuation Officer (DVO) and considered the valuation report. The Tribunal cited the assessment order, which specifically referred to the non-compete fees and the DVO's valuation, indicating that the Assessing Officer had indeed considered the valuation aspect.
  
  4. Principles of Natural Justice and Application of Mind by the Assessing Officer:
  
  The Tribunal highlighted that the Assessing Officer's duty is to determine the correct tax liability, even if the Assessee inadvertently includes a non-taxable amount as income. The Tribunal referred to the Board circular dated 11-4-1955, which emphasizes that officers should assist taxpayers in claiming and securing reliefs they are entitled to, even if not claimed. The Tribunal concluded that the Assessing Officer had applied his mind to the issue of non-compete fees and had duly considered the Assessee's submissions, making the assessment order neither erroneous nor prejudicial to the interests of the revenue.
  
  Conclusion:
  
  The Tribunal set aside the order of the Commissioner, holding that the Assessing Officer had adopted a legally acceptable view after due consideration of the facts and relevant case laws. The appeal filed by the Assessee was allowed, affirming that the non-compete fees were not taxable as income and that the assessment order was not erroneous or prejudicial to the interests of the revenue.

  ---

• 2009 (12) TMI 1035
  
  Issues involved: Jurisdiction u/s 147, Addition of Rs. 54.05 lakhs, Charging of interest u/s 234A and 234B, Award of costs in prosecuting the appeal and order for refund of institution fee.
  
  Jurisdiction u/s 147:
  The appeal was against the order of the Ld.CIT(A)-V, Bangalore, for the assessment year 2005-06. The assessee contended that the AO had not validly assumed jurisdiction u/s 147 of the Act by issuing a Notice u/s 148, making the assessment void-ab-initio. The AO issued a notice u/s 142(1) as the assessee had not filed the return of income. The AO concluded the assessment u/s 143(3) based on the return furnished, which was deemed valid. The contention of the assessee was dismissed as there was no infirmity in the assumption of jurisdiction by the AO.
  
  Addition of Rs. 54.05 lakhs:
  The assessee failed to substantiate claims regarding cash deposits in the bank account amounting to Rs. 54.05 lakhs. The Ld.CIT(A) found no evidence to support the claim that the deposits were related to a temple fund or chit fund. The Tribunal remitted the issue back to the AO to work out the taxable income using the peak credit method, considering the lack of documentary evidence provided by the assessee. The Tribunal referred to relevant case laws to support its decision.
  
  Charging of interest u/s 234A and 234B:
  The Tribunal considered the charging of interest u/s 234A and 234B as consequential and dismissed this ground.
  
  Award of costs in prosecuting the appeal and order for refund of institution fee:
  The Tribunal dismissed the assessee's claim for award of costs in prosecuting the appeal and refund of institution fees due to the lack of full disclosure of facts by the assessee during the assessment proceedings.
  
  In conclusion, the assessee's appeal was partly allowed for statistical purposes, with the Tribunal directing the AO to reevaluate the taxable income based on peak credit method and afford the assessee a reasonable opportunity to be heard.

  ---

• 2009 (12) TMI 1034
  

  Interest paid on late deposit of service-tax with Government account - AO treated above amount as a penalty and disallow the same - CIT(A) held that payment made was of compensatory nature and therefore, permissible as a business deduction, thus deleted the disallowance - HELD THAT:- Following the decision in the case of Mahalakshmi Sugar Mills.[1980 (4) TMI 1 - SUPREME COURT], examined the question whether interest paid on delayed payment of "cess" was a penalty. After considering relevant statutory provisions, it was held that it was compensatory and therefore, a permissible deduction. We have examined relevant provisions of section 75 and are of the view that interest paid for the delayed payment of service-tax is compensatory and has the same character as service-tax. There is no dispute that service-tax is a permissible deduction. In our opinion, the interest should also be allowed in the same manner. In the light of above discussion, we uphold the order of CIT(A) on ground No. 1.

  Nature of expenditure - Enduring benefit in acquiring logo - business deduction or not? - whether by making payment in question, the assessee has acquired any enduring benefit - HELD THAT:- It is quite evident from above that Messee Dusseldorf GmbH permitted the assessee the use of logo for limited period between 24th to 27th Sept., 2003 and between 5th Dec, 2003 to 9th Dec, 2003 at trade fairs held at Hyderabad. No enduring benefit was received by the assessee. Expenditure was incurred wholly and exclusively for purposes of business and was rightly allowed by the learned CIT(A) as a revenue deduction. We confirm his finding and dismiss the second ground of appeal also.

  ---

123456........ 40