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2010 (5) TMI 945
The Delhi High Court considered the issue of penalty imposed under Section 271(1)(c) of the Income Tax Act, 1961 for additions to Profit and Loss Account. The Tribunal's decision on the penalty was questioned as potentially perverse. The court reserved its order after hearing arguments on the matter.
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2010 (5) TMI 944
Issues Involved:
1. Whether the State Governments are required to continue with the conditions of experience in the field of registration plates in foreign countries and a minimum annual turnover from such business as upheld in the Association of Registration Plates v. Union of India case.
2. Whether the State Governments can modify or do away with these conditions in their Notices Inviting Tenders (NIT) for the award of contracts for High Security Registration Plates (HSRP).
3. Whether the cancellation of the first NIT and the issuance of a second NIT by the State Governments was justified and in public interest.
4. Whether the actions of the State Governments in modifying the NIT conditions were arbitrary, discriminatory, or mala fide.
Detailed Analysis:
1. Continuation of Conditions Upheld in Association of Registration Plates v. Union of India:
The Supreme Court had previously upheld the conditions requiring experience in foreign countries and a minimum annual turnover for the award of contracts for HSRP in the Association of Registration Plates v. Union of India case. These conditions were considered essential to ensure that the selected manufacturer would be technically and financially competent to fulfill the contractual obligations. However, the Court did not prescribe these conditions as mandatory for all future NITs.
2. Modification or Removal of Conditions in NIT:
The Court examined whether the State Governments could modify or remove the conditions upheld in the Association of Registration Plates case. It was noted that the State Governments have the discretion to change their policies and conditions in the NIT, especially when circumstances change. The Court emphasized that government policies can evolve with changing circumstances and that such changes are permissible as long as they conform to Wednesbury reasonableness and are free from arbitrariness, irrationality, bias, and malice.
3. Justification for Cancellation and Issuance of New NIT:
The State of West Bengal canceled its first NIT and issued a second NIT, removing the conditions of foreign experience and minimum turnover, citing increased competition and public interest. The Court found this action justified, noting that the circumstances had changed with more manufacturers obtaining the requisite Type Approval Certificates (TAC). The decision to broaden the base of competitive bidding was seen as serving greater public interest without compromising on safety, security, and quality.
Similarly, the State of Orissa issued a fresh NIT without the conditions of foreign experience and minimum turnover. The Court found no fault with this action, as it was in line with the principles of Wednesbury reasonableness and public interest.
4. Allegations of Arbitrariness, Discrimination, and Mala Fides:
The appellants argued that the actions of the State Governments were arbitrary and discriminatory. However, the Court found no substantial material to support these allegations. It was noted that the decision to cancel the first NIT and issue a second one was made in public interest and not to favor any particular bidder. The Court also rejected the claim of mala fides, stating that the actions of the State Governments were justified and in accordance with the law.
Conclusion:
The Supreme Court dismissed the appeals, upholding the decisions of the State Governments to modify the NIT conditions. The Court emphasized that government policies can change with circumstances and that such changes are permissible as long as they conform to principles of reasonableness and public interest. The actions of the State Governments in issuing new NITs without the previously upheld conditions were found to be justified and in larger public interest.
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2010 (5) TMI 943
Issues Involved:
1. Infringement of Copyright
2. Applicability of First Sale Doctrine and its Impact
3. Jurisdiction of the Court
4. Relief under the Specific Relief Act
Detailed Analysis:
Infringement of Copyright:
The plaintiffs, comprising corporations and their exclusive licensees, allege that the defendants are infringing their copyrights by exporting low-price editions of their books, which are meant for sale only in specific territories, to countries outside these designated regions. The plaintiffs argue that such acts violate the territorial restrictions imposed by the copyright owners and cause substantial financial losses.
The court examined the relevant provisions of the Copyright Act, 1957, particularly Sections 13, 14, and 51, which outline the rights of copyright owners and what constitutes infringement. The court noted that the rights of the owner of the copyright are broader than those of an exclusive licensee, and infringement must be assessed from the perspective of the owner's rights.
The court found that the defendants' actions of selling and exporting books beyond the specified territories violated the rights of the copyright owners under Section 14(a)(ii) of the Act, which grants the owner the exclusive right to issue copies of the work to the public, not being copies already in circulation. The court held that these acts amounted to primary infringement under Section 51(a) of the Act.
Applicability of First Sale Doctrine and its Impact:
The defendants argued that the first sale doctrine, which limits the copyright owner's control over the distribution of a work after the first sale, should apply, thereby exhausting the plaintiffs' rights once the books were sold in India. They cited various US case laws and the judgment in Warner Bros. Entertainment Inc. v. Santosh V.G. to support their argument.
The court, however, distinguished the present case from the cited judgments, noting that the doctrine of first sale would only exhaust the rights of the exclusive licensees, not the broader rights of the copyright owners. The court also expressed doubts about the applicability of international exhaustion of rights in India, suggesting that the principle should be confined to regional exhaustion due to the absence of express provisions in Indian law.
The court concluded that even if the first sale doctrine were applicable, it would not defeat the rights of the copyright owners to complain about infringement in unauthorized territories.
Jurisdiction of the Court:
The defendants contended that the court lacked jurisdiction as the acts of infringement occurred outside India. The court rejected this argument, stating that it had jurisdiction under Section 20 of the Code of Civil Procedure, 1908, as the defendants were carrying on business in Delhi, and essential parts of the cause of action, such as taking orders and dispatching books, occurred within its territorial jurisdiction.
The court also clarified that the acts of primary infringement, such as offering for sale and exporting books from India, violated the rights of the copyright owners within India. Therefore, the court had the authority to entertain the suit.
Relief under the Specific Relief Act:
The defendants argued that the suit for injunction was not maintainable under the Specific Relief Act, 1963, and that the plaintiffs' actions constituted unfair trade practices. The court dismissed these arguments, noting that the plaintiffs had established a prima facie case of infringement and were entitled to seek injunctive relief to protect their statutory rights.
Conclusion:
The court concluded that the defendants' acts were prima facie infringing in nature and warranted the grant of a temporary injunction. The plaintiffs had successfully demonstrated ownership of the copyrights and the violation of their rights by the defendants. The balance of convenience favored the plaintiffs, and they would suffer irreparable harm if the defendants were not restrained.
The court allowed the plaintiffs' application for a temporary injunction and dismissed the defendants' application for vacation of the ex-parte injunction. The defendants and their agents were restrained from advertising, offering for sale, or exporting any publications of the plaintiffs to countries outside the specified territories until the disposal of the suit.
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2010 (5) TMI 942
Issues Involved:
1. Levy of penalty u/s 271(1)(c) of the Income-tax Act, 1961.
2. Concealment of income and furnishing of inaccurate particulars.
Summary:
Issue 1: Levy of penalty u/s 271(1)(c) of the Income-tax Act, 1961
The assessee challenged the order of the CIT(A) confirming the levy of penalty of Rs. 11,23,906 u/s 271(1)(c) of the Income-tax Act, 1961. The assessment was completed u/s 143(3) r.w.s. 147, determining the income at Rs. 55,13,070 against the returned income of Rs. 5,04,570, with an addition of Rs. 50,08,496 on account of capital gain on the sale of a plot of land at Vasai. The assessee did not appeal the assessment order, and the Assessing Officer initiated penalty proceedings u/s 271(1)(c).
Issue 2: Concealment of income and furnishing of inaccurate particulars
The assessee argued that the capital gain on the sale of Vasai land was declared in the original returns for A.Y. 2005-06 to A.Y. 2007-08 on a receipt basis, as payments were received in those years. The Assessing Officer rejected this argument, noting that the assessee declared 'nil' capital gain despite a significant transaction of Rs. 2.6 crores. The officer concluded that the assessee deliberately tried to evade tax by spreading the capital gain over three years, which is not permissible under the law, and levied a penalty of Rs. 11,23,906.
The CIT(A) upheld the penalty, stating that the entire gain should have been offered to tax in the year of the sale agreement (2004). The CIT(A) found no ambiguity in the Act regarding the computation of capital gain and concluded that the assessee concealed particulars of income. The assessee's reliance on various judicial decisions was distinguished as not applicable to the facts of the case.
The Tribunal considered the rival submissions and found that the assessee did not act in a bona fide manner. The assessee failed to disclose the method of accounting for capital gain in the original return and did not file a revised return until the mistake was detected by the Assessing Officer during the A.Y. 2007-08. The Tribunal upheld the CIT(A)'s order, concluding that the assessee concealed particulars of income and furnished inaccurate particulars, justifying the penalty u/s 271(1)(c).
Conclusion:
The appeal filed by the assessee was dismissed, and the penalty u/s 271(1)(c) was upheld. The Tribunal found that the assessee had concealed particulars of income and furnished inaccurate particulars, warranting the levy of penalty.
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2010 (5) TMI 941
Issues involved: Aggrieved by the issuance of warrant of arrest and dismissal of application u/s 70(2) of Cr.P.C.
Summary:
The petitioners approached the High Court challenging the warrant of arrest issued by the trial Court and the dismissal of their application to convert it into a bailable warrant. The case involved allegations of assault under various sections of the IPC. The trial Court, considering the gravity of the offence and the status of the accused who were police personnel, issued a warrant of arrest. The petitioners contended that their liberty was compromised, citing violation of Article 21 of the Constitution of India. The Public Prosecutor argued that as upholders of the law, the accused police personnel's actions warranted a serious view. The High Court, after considering the arguments and case law, upheld the trial Court's decision to issue a non-bailable warrant, emphasizing the importance of upholding the rule of law and restoring faith in the state authority.
The High Court emphasized that while liberty is fundamental, it is not absolute and can be deprived following due process. The issuance of a non-bailable warrant is a legal procedure under Cr.P.C. The Court justified the trial Court's decision based on the seriousness of the allegations against the police personnel and the need to maintain public trust in law enforcement. The delay in executing the warrant was noted, indicating a failure of the Police Department to uphold accountability. The Court distinguished a previous case involving different offences and non-police personnel, highlighting the unique circumstances of this case where law enforcers were accused of violating the law.
In conclusion, the High Court found no illegality in the trial Court's order and dismissed the petition, affirming the validity of the warrant of arrest issued against the accused police personnel.
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2010 (5) TMI 940
Issues involved:
The issues involved in this case include the determination of tenancy, validity of termination of lease, and the application of Order 12 Rule 6 of the Code of Civil Procedure for passing a judgment on admission.
Determination of Tenancy:
The case involved a dispute regarding the expiry of the tenancy by efflux of time and the termination of the lease. The plaintiff-landlord claimed that the lease had expired, and a termination notice was sent to the tenant. However, the tenant disputed both the expiry of tenancy and the termination. The appellant argued that the lease deed could not be terminated due to certain clauses. The court did not decide on these contentions but focused on the admission issue.
Validity of Termination of Lease:
The plaintiff-landlord claimed that the lease had expired, and a termination notice was sent to the tenant. The tenant disputed the termination in their written statement. The court noted that there was no clear admission by the tenant regarding the termination of the lease. The appellant denied admitting to the termination or determination of tenancy, emphasizing that issues were still to be framed and tried according to the Civil Procedure Code.
Application of Order 12 Rule 6:
The respondents-plaintiffs filed an application under Order 12 Rule 6 for passing a judgment on admission based on the appellant's written statement. The appellant denied any admission and requested the dismissal of the application. The court analyzed previous judgments related to Order 12 Rule 6 and emphasized the need for a clear and unequivocal admission for its application. It was concluded that there was no clear admission of the plaintiff's case by the appellant in the pleadings.
Conclusion:
The Supreme Court set aside the judgments of the High Court and the Additional District Judge. The matter was remanded to the trial court for expedited disposal within six months. The court clarified that it had not made any observations on the merits of the case. The appeal was allowed with no order as to costs.
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2010 (5) TMI 939
Issues Involved:
1. Justification for invoking provisions of section 145.
2. Comparison of Gross Profit (GP).
3. Onus on the assessee to produce parties for verification of sales and purchases.
Summary:
1. Justification for invoking provisions of section 145:
The Assessing Officer (AO) invoked section 145, doubting the veracity of transactions with 19 parties, as only 2 responded to notices u/s 133(6), 4 notices were returned unserved, and 13 did not reply initially. The AO rejected the book results, considering the replies received later as not genuine. The assessee argued that the AO should have used his powers u/s 131 to summon the parties. The CIT(A) found the AO's action unjustified, noting that the GP was progressive and no specific defects were found in the books of accounts.
2. Comparison of Gross Profit (GP):
The AO compared the assessee's GP with other diamond traders, finding it lower. The assessee contended that its GP had improved over the years and that it dealt in the local market, unlike the comparables engaged in exports. The CIT(A) agreed with the assessee, noting that the GP was better than in previous years and that the AO's comparison was not appropriate.
3. Onus on the assessee to produce parties for verification of sales and purchases:
The AO doubted the transactions as some notices were returned unserved and others were replied to from the same post office on the same date. The assessee requested the AO to summon the parties u/s 131, which the AO did not do. The CIT(A) held that the AO should have summoned the parties if he had doubts and that no adverse inference could be drawn without doing so.
Conclusion:
The Tribunal upheld the CIT(A)'s order, stating that the AO did not point out any specific defects in the books of accounts and that the assessee had provided sufficient explanations and documentation. The appeal of the revenue was dismissed.
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2010 (5) TMI 938
Accused in a case of defrauding the Industrial Development Bank of India (IDBI) - Petition u/s 439 - Seeking grant of bail u/s 120B r/w Sections 420, 468 and 478 of the IPC - The petitioner was arrested by the CBI on 19th February, 2010 and remained in police custody till 27th February, 2010. The petitioner has been in judicial custody thereafter and has been charge sheeted along with five other co-accused in a case of defrauding the Industrial Development Bank of India (IDBI).
HELD THAT:- In the instant case the FIR was registered on source information and before registration of the present FIR preliminary enquiry was conducted by the CBI. It has nowhere been disclosed on whose statement the FIR was registered and no one from the bank from which loan was availed came forward alleging that the bank has been cheated by the accused persons.
In the order passed by the ACMM at the time of hearing submissions on the aspect of cognizance in the case, it has been observed that the Investigating Officer (IO) has not been able to point out even an iota of evidence in the testimony of the bank witnesses exhibiting that they were deceived by the inducement given by the accused persons. The IO has further not clarified, if, as per the statements given by the bank officials, the machines were working there then how and from where they were procured and if no machine was procured then how the bank officials given their report.
Petitioner has been in judicial custody, after initial police custody of one week, for a period over 90 days and has already been charge sheeted. The petitioner is 76 years of age and admittedly is a chronic heart patient suffering from coronary heart disease since 1998. Also, nothing has been urged on behalf of the CBI to raise a reasonable apprehension that the petitioner will tamper with the prosecution evidence if he is released on bail. Further, nothing has been urged to suggest that the CBI has a reasonable apprehension that the petitioner will flee from justice if he is released on bail. From the material placed on record and the conduct of the petitioner in appearing before the CBI when summoned before his arrest, it is clear that the petitioner is an established businessman with roots in the Society.
Bail, it has been held in a catena of decisions, is not to be withheld as a punishment. Even assuming that the accused is prima facie guilty of a grave offence, bail cannot be refused in an indirect process of punishing the accused person before he is convicted. Furthermore, there is no justification for classifying offences into different categories such as economic offences and for refusing bail on the ground that the offence involved belongs to a particular category. It cannot, therefore, be said that bail should invariably be refused in cases involving serious economic offences.
The charge sheet in the present case has been filed and cognizance taken on 22nd May 2010 and the petitioner is, therefore, not required for any purpose. It is also seen that evidence has already been collected qua the petitioner and the CBI has not thought it appropriate to ask for custodial interrogation of the petitioner during the long period of 90 days when the petitioner was in judicial custody. One more consideration which weighs with the Court is that a scheme of arrangement u/s 391 of the Companies Act, 1956 has been filed by SML Company and is pending finalization before the Hon'ble Allahabad High Court. Under the scheme of arrangement the IDBI and the petitioner were already agreed on the terms and conditions for the repayment of the loan extended to the company at the instance of the petitioner and other co-accused.
Having regard to the entire facts and circumstances of the case, I do not find any justification for detaining the petitioner in prison any longer. Therefore, the petitioner who is in custody since 19th February, 2010 should be released on bail on furnishing a personal bond in the sum of ₹ 5,00,000/- (Rupees five lakhs) with two sureties in the like amount to the satisfaction of the trial court and subject to the conditions.
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2010 (5) TMI 937
Issues Involved: Confirmation of penalty u/s 271(1)(c) of the Income-tax Act for the assessment year 2006-07.
Issue 1: Disallowance of Loss and Imposition of Penalty
- The Assessing Officer disallowed a loss claimed by the assessee on the sale of a portal site against capital gains, initiating and levying a penalty for concealment u/s 271(1)(c).
- Assessee's contention: The mistake in claiming the loss was inadvertent, rectified by filing a revised return offering the amount for taxation, with no inaccurate particulars or facts concealed.
- Assessee's argument supported by the acceptance of audited books of account and the involvement of an income-tax consultant in preparing the return.
- Assessee relied on precedents where penalties were not imposed for inadvertent errors.
- Conclusion: The penalty was not imposable due to the inadvertent nature of the mistake and the absence of inaccurate particulars.
Issue 2: Justification for Penalty Imposition
- Revenue's stance: Penalty imposition justified based on the inadmissible claim of set off of loss against capital gains, as per section 50(2), with reference to legal precedents.
- Assessee's rebuttal citing a Delhi High Court judgment that penalties should not be imposed for inadvertent errors.
- Conclusion: The penalty was deleted considering the inadvertent error, the low tax amount involved, and the explanations provided by the tax consultant.
Conclusion: The penalty u/s 271(1)(c) for the assessment year 2006-07 was deleted by the Appellate Tribunal ITAT Delhi, emphasizing the inadvertent nature of the error and the absence of inaccurate particulars or concealment of facts.
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2010 (5) TMI 936
Issues involved: Challenge to detention order at preexecution stage, similarity of facts to previous case.
Challenge to detention order at preexecution stage: The appeal was against the judgment of the Delhi High Court dismissing the Writ Petition challenging the detention order at the preexecution stage on the ground of non-maintainability. The appellant argued for quashing the order based on a similar case precedent.
Similarity of facts to previous case: The appellant cited a previous case where the Supreme Court had quashed a detention order due to lack of execution and absence of evidence of continued unlawful activities post-order. The Court, after hearing both parties, noted the similarity in facts with the present case and allowed the appeal, quashing the detention order. It was clarified that the decision was specific to the case at hand and not a general precedent for other cases.
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2010 (5) TMI 935
Issues Involved:
1. False implication and recovery evidence.
2. Contradictions in Form No. 29 (CFSL Form) preparation.
3. Non-examination of independent witness and seal handling.
4. Delay in sending the sample for examination.
5. Compliance with Section 42 of the NDPS Act.
Detailed Analysis:
1. False Implication and Recovery Evidence:
The appellant argued that he was falsely implicated and no recovery was made by SI Vishwa Mitter in the presence of DSP Ranvir Singh. The defense pointed out contradictions in the statements of the prosecution witnesses regarding the mobile numbers used during the raid and the vehicle details of DSP Ranvir Singh, creating doubt about the actual presence of DSP Ranvir Singh at the spot. The court noted these contradictions and the lack of clarity in the prosecution's narrative, which undermined the reliability of the recovery evidence.
2. Contradictions in Form No. 29 (CFSL Form) Preparation:
The defense highlighted significant contradictions in the preparation of Form No. 29. SI Vishwa Mitter stated that the form was filled by SHO Mandip Singh at the police station, whereas SHO Mandip Singh claimed it was filled by SI Vishwa Mitter at the spot. DSP Ranvir Singh also contradicted these statements, asserting that the form was filled at the spot by SI Vishwa Mitter. The court observed that these inconsistencies, along with the suspicious appearance of the original form with seals pasted on separate papers, cast serious doubt on the prosecution's case and suggested possible tampering with the evidence.
3. Non-examination of Independent Witness and Seal Handling:
The defense argued that the independent witness, Gurmail Singh, was not examined by the prosecution, and the seal used during the recovery was handed over to ASI Gurcharan Singh, a member of the police party, instead of an independent witness. The court noted that the non-examination of the independent witness and the handling of the seal by a police official raised concerns about the integrity of the evidence. The court emphasized that the seal should have been handed over to an independent person to prevent any possibility of tampering.
4. Delay in Sending the Sample for Examination:
The defense pointed out a delay of five days in sending the sample to the Forensic Science Laboratory, arguing that it created doubt about the prosecution's case. The court referred to previous judgments indicating that such delays are not necessarily fatal unless it is shown that the delay caused serious prejudice to the accused. However, in this case, the court found that the delay, combined with other inconsistencies, contributed to the overall doubt about the prosecution's case.
5. Compliance with Section 42 of the NDPS Act:
The defense argued that SI Vishwa Mitter did not comply with Section 42 of the NDPS Act, which requires written communication of secret information to higher authorities. The court, however, found that Section 42 was not applicable as the recovery was made from an open public place, not a residential premises. The court noted that Section 43, which governs seizures in public places, was applicable and did not require the same procedural formalities as Section 42.
Conclusion:
The court concluded that the prosecution failed to prove the case beyond a reasonable doubt due to significant contradictions in the evidence, possible tampering with Form No. 29, non-examination of the independent witness, and improper handling of the seal. The appeal was allowed, and the conviction and sentence were set aside, resulting in the appellant's release.
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2010 (5) TMI 934
Issues Involved:
The judgment involves issues related to additions made by the Assessing Officer on various grounds such as fees paid for appeal to ITAT, interest paid for car loans, bonus paid to employees, payment of professional fees, vehicle maintenance expenses, depreciation on car, and presumed interest on a loan given by the assessee to his father.
Fees Paid for Appeal to ITAT:
The appellant challenged the addition of Rs. 10,000 as fees paid for appeal to ITAT, arguing that it was related to business and not personal expenditure. The Tribunal allowed this ground as the payment was made for business purposes.
Interest Paid for Car Loans, Vehicle Maintenance Expenses, and Depreciation on Car:
The appellant contested the additions of Rs. 69,113 for car loan interest, Rs. 21,971 for vehicle maintenance, and Rs. 1,04,595 for car depreciation. The Tribunal partially allowed these grounds, disallowing a portion of the claims due to potential personal use.
Bonus Paid to Employees:
Regarding the addition of Rs. 76,267 for bonus paid to employees, the Tribunal allowed Rs. 7,300 as it met the criteria under section 43B read with section 36 of the IT Act. However, Rs. 14,100 was disallowed due to lack of evidence of salary payment to the employees.
Payment of Professional Fees:
The appellant disputed the addition of Rs. 8,000 and Rs. 5,000 for professional fees, arguing they were for business purposes. The Tribunal allowed these grounds, stating the payments were not personal in nature.
Presumed Interest on Loan to Father:
The addition of Rs. 2,83,500 as presumed interest on a loan given by the assessee to his father was contested. The Tribunal ruled in favor of the appellant, stating it was not a case of revocable transfer of asset and the provisions of section 61 were not applicable.
Conclusion:
The Tribunal partly allowed the appeal of the assessee, considering the nature of expenses and payments in relation to business activities. The judgment was pronounced on 4th May, 2010.
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2010 (5) TMI 933
Issues involved: Determination of unexplained cash deposits in the bank account u/s 143(3) of the Income Tax Act, 1961 for Assessment Year 2005-06.
Assessing Officer's Findings: The Assessing Officer treated the entire cash deposits of Rs. 27,55,000/- in the assessee's bank account as unexplained, adding it to the income of the assessee based on lack of verifiable opening cash in hand and absence of balance sheet and capital accounts for earlier years.
Assessee's Appeal before CIT(A): The assessee contended that all cash deposits were explained by existing balances and income sources, denying the existence of unexplained cash deposits. The appellant argued against the application of 'peak' theory and emphasized the availability of sufficient cash balance on deposit days.
CIT(A) Decision: The CIT(A) found the appellant's explanations inadequate, treating the 'peak' of deposits and withdrawals as unexplained income to ensure fairness. The peak cash balance was determined at Rs. 15,12,225/-, replacing the original assessment amount of Rs. 27,55,000/-.
Appellate Tribunal Decision: The Tribunal rejected the CIT(A)'s peak cash balance determination, calculating unexplained cash deposits at Rs. 5,80,000/- after considering the absence of evidence for the opening cash balance. The appeal was partly allowed, directing the Assessing Officer to adopt the revised figure.
Conclusion: The Tribunal partially allowed the appeal, reducing the unexplained cash deposits to Rs. 5,80,000/- from the initial assessment of Rs. 27,55,000/-, emphasizing the importance of providing supporting evidence for cash transactions to avoid discrepancies in income tax assessments.
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2010 (5) TMI 932
Issues Involved:
1. The ceiling limit of deposit for production of answer scripts.
2. The right of the Council to retain the deposit.
3. The Court's power to appropriate costs from the deposit at the final hearing.
Summary:
Issue 1: Ceiling Limit of Deposit for Production of Answer Scripts
The primary issue was whether the court's direction that the deposit for the production of answer scripts should not exceed Rs. 500 per script is correct. The Bench noted conflicting views in two previous judgments. The first judgment suggested a fixed ceiling of Rs. 500 per script, while the second judgment disagreed, stating that a generalized ceiling is improper. The Bench concluded that the view fixing a ceiling limit of Rs. 500 per script does not find any legal support and answered this issue in the negative.
Issue 2: Right of the Council to Retain the Deposit
The second issue examined whether the order of deposit creates any right for the Council to retain it altogether. The Bench rejected the contention that the deposit order gives the Council a vested right to retain the deposit. The Bench clarified that the deposit is merely a security to ensure the Council does not suffer in a meritless action by the examinee. The principle of res judicata does not apply to the order of deposit as it is a procedural matter, not a substantive law issue. Thus, the answer to this issue was in the negative.
Issue 3: Court's Power to Appropriate Costs from the Deposit
The third issue was whether the Court has the power to appropriate costs from the deposit at the final hearing. The Bench affirmed that the Court has the discretion to appropriate costs from the deposit based on the facts and circumstances of each case. The Court's discretion should be exercised judiciously, considering the hardship faced by both parties. The Bench emphasized that no hard and fast rule can be laid down for appropriation, and it should be left to the Court's discretion. Therefore, the answer to this issue was in the affirmative.
Conclusion:
The matter was disposed of with the Bench's views to be considered in all other related appeals. The Court emphasized the importance of judicial discretion and the need for a case-by-case approach in determining deposits and appropriations.
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2010 (5) TMI 931
The Appellate Tribunal CESTAT CHENNAI dismissed an appeal based on a Larger Bench decision in the case of Vandana Global Ltd. & Ors. Vs. CCE, Raipur & Ors., which held that credit of duty for goods like cement and steel used for construction purposes is not available.
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2010 (5) TMI 930
Issues Involved:
1. Power of Central Information Commission to appoint a committee for inquiry.
2. Validity of Central Information Commission (Management) Regulations, 2007.
3. Power of Central Information Commission to summon the Vice-Chairman, DDA.
Issue-wise Detailed Analysis:
1. Power of Central Information Commission to Appoint a Committee for Inquiry:
The core question was whether the Central Information Commission (CIC) had the authority under the RTI Act to appoint a committee comprising non-members for inquiry into a public authority's compliance with Section 4 of the RTI Act. The court analyzed Sections 4, 18, and 19 of the RTI Act and concluded that the Act does not empower the CIC to delegate its inquiry powers to any other committee or person. The maxim "Delegatus non potest delegare" (a delegate cannot further delegate) was cited, emphasizing that the CIC must conduct inquiries itself. Thus, the appointment of a third-party committee by the CIC was deemed ultra vires, and the impugned order was set aside to this extent.
2. Validity of Central Information Commission (Management) Regulations, 2007:
The court examined whether the Chief Information Commissioner (CIC) had the authority to frame the Central Information Commission (Management) Regulations, 2007, particularly Regulation 20. It was found that Section 12(4) of the RTI Act, which was cited as the source of power, only pertains to the internal management of the CIC and does not extend to substantive or procedural provisions of the Act. The court highlighted that the CIC, being a statutory body, cannot exceed the powers conferred by the statute. The impugned Regulations were found to be beyond the CIC's authority and thus were quashed as ultra vires the RTI Act.
3. Power of Central Information Commission to Summon the Vice-Chairman, DDA:
The court scrutinized the CIC's power to summon individuals under Section 18(3) of the RTI Act, which allows summoning for the purpose of giving evidence or producing documents. It was determined that the CIC's direction for the Vice-Chairman, DDA to be present was not for giving evidence but for other reasons, which is beyond the CIC's statutory powers. The court stated that such summoning powers are limited to courts of plenary jurisdiction and not to statutory bodies like the CIC. Consequently, the adverse inference drawn against the Vice-Chairman, DDA for his absence was set aside.
Reliefs:
The impugned order dated 22.09.2009 was set aside to the extent that it appointed an inquiry committee and drew an adverse inference from the absence of the Vice-Chairman, DDA. The Central Information Commission (Management) Regulations, 2007 were quashed as ultra vires the RTI Act. The parties were directed to bear their respective costs.
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2010 (5) TMI 929
Whether the appellant is required to discharge customs duty foregone by the Revenue on the capital goods and raw materials, consumables and components, imported for setting up of green house for export of cut flowers as per the letter of permission given by DGFT?
Held that:- The admitted fact being that the appellant had installed and used the capital goods and raw materials, consumables and components imported by him claiming the benefit of Notification No.126/94-Cus. and it is recorded in the Order-in-Original that the appellant had started commercial production from 10/11/1995.
It is undisputed that the capital goods which were procured by claiming benefit of exemption under Notification No.126/94-Cus was installed and used for production of goods for export - as per notification, the demand of the duty on the capital goods cannot be sustained.
Enhancement of penalty imposed by the adjudicating authority - Held that:- As we have held in favour of the appellant/assessee on merits and set aside the impugned order, there cannot be any penalty on the appellant and hence, question of enhancement of the penalty as prayed in the Revenue’s appeal does not arise.
Appeal allowed - decided in favor of appellant.
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2010 (5) TMI 928
Challenge the marks prescribed for viva-voce test were excessive and contrary to the law - recruitment for the appointment of Civil Judges (Junior Division) - unsuccessful in merit - Division Bench of the High Court non-suited the Petitioner on the ground that he moved the Court after taking a chance for being selected on the basis of the provision which he was seeking to challenge - Whether the selection process was not in accordance with the Rules? - HELD THAT:- The marks prescribed for viva voce test/interview are excessive and selection made in accordance with the criteria like the one specified in Rule 14 read with Appendix-C and para (vi) of the advertisement issued by the Commission has been considered by this Court in several cases including those upon which reliance has been placed by Learned Counsel for the Petitioner. Although, no straitjacket formula has been judicially evolved for determining whether the prescription of particular percentage of marks for viva voce test/interview introduces an element of arbitrariness in the process of selection or gives unbridled power to the recruiting authority/agency to select less meritorious candidates, by and large, the courts have not found any Constitutional infirmity in prescribing of higher percentage of marks for viva voce test/interview for recruitment to judicial services, administrative services and the like.
We are of considered view, that earmarking of 200 marks for viva voce test as against 850 marks for written examination does not violate the doctrine of equality embodied in Articles 14 and 16 of the Constitution.
We also agree with the High Court that after having taken part in the process of selection knowing fully well that more than 19% marks have been earmarked for viva voce test, the Petitioner is not entitled to challenge the criteria or process of selection.
Surely, if the Petitioner's name had appeared in the merit list, he would not have even dreamed of challenging the selection. The Petitioner invoked jurisdiction of the High Court under Article 226 of the Constitution of India only after he found that his name does not figure in the merit list prepared by the Commission. This conduct of the Petitioner clearly disentitles him from questioning the selection and the High Court did not commit any error by refusing to entertain the writ petition.
Reference in this connection may be made to the Judgments in Madan Lal v. State of J. and K.[1995 (2) TMI 441 - SUPREME COURT], Marripati Nagaraja v. Government of Andhra Pradesh and Ors.[2007 (10) TMI 617 - SUPREME COURT], Dhananjay Malik and Ors. v. State of Uttaranchal and Ors.[2008 (3) TMI 667 - SUPREME COURT], Amlan Jyoti Borooah v. State of Assam[2009 (1) TMI 853 - SUPREME COURT].
In the result, the special leave petition is dismissed.
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2010 (5) TMI 927
Issues Involved:
1. Confirmation of penalty u/s 271(1)(c) for concealing particulars of income or furnishing inaccurate particulars.
2. Legality of penalty on protective assessment.
Summary:
Issue 1: Confirmation of Penalty u/s 271(1)(c)
The assessee's appeal challenges the CIT(A)'s order confirming the penalty levied by the Assessing Officer u/s 271(1)(c) of the Income-tax Act, 1961. The penalty of Rs. 11,57,000 was imposed for concealing particulars of income or furnishing inaccurate particulars. The assessee argued that no penalty can be levied on protective assessment and that the CIT(A) failed to consider the case's facts and circumstances.
Issue 2: Legality of Penalty on Protective Assessment
The brief facts reveal that during a search operation u/s 132, incriminating documents were found, leading to the disclosure of undisclosed income. The Assessing Officer made a protective assessment in the assessee's hands and a substantive assessment in the hands of two firms. The CIT(A) directed the Assessing Officer to make the assessment on a substantive basis in the assessee's hands, following the Tribunal's orders in the firms' cases.
The Assessing Officer noted that the income belonged to the firm and made a protective assessment in the assessee's case. The assessee argued that the penalty proceedings initiated during the protective assessment were invalid, as the Assessing Officer was not sure about the income's ownership. The CIT(A) confirmed the penalty, stating that no assurance was given during the search that no penalty would be levied and that the requirements of Explanation 5 to Sec. 271(1)(c) were not met.
The Tribunal found that the Assessing Officer was not sure about the income's ownership and made the protective assessment to protect the revenue. There was no material to prove the existence of circumstances leading to satisfaction for initiating penalty proceedings u/s 271(1)(c). The Tribunal relied on the jurisdictional High Court's decision in the case of Shri Bankim J Shah, which held that "reason to believe" is on a lower pedestal than "satisfaction," required for initiating penalty proceedings.
Conclusion:
The Tribunal concluded that the requisite satisfaction recorded by the Assessing Officer for initiating penalty proceedings was without basis and could not survive. Accordingly, the penalty levied by the Assessing Officer and confirmed by CIT(A) was deleted. The appeal of the assessee was allowed.
Order:
The assessee's appeal is allowed. Order pronounced in Open Court on 07/05/2010.
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2010 (5) TMI 926
Issues involved: Determination of right to mining iron ore, challenge to state order suspending mining operations, consideration of C.E.C. report, demarcation of mining lease boundaries, dispute between states over boundaries, recommendations of the Committee, permission for mining in undisputed areas.
Summary:
1. The respondent challenged the state order suspending mining operations based on C.E.C. report. High Court granted interim relief, but Supreme Court directed High Court to consider the matter on merits within four weeks, maintaining the interim order.
2. High Court allowed the writ petitions filed by the respondent, setting aside the challenged orders. State appealed to Supreme Court, leading to the maintenance of status quo till boundaries were determined by experts.
3. An interim order directed the demarcation of mining lease boundaries by a team, with a prohibition on mining operations until completion. The Committee submitted interim and final reports with recommendations for review and demarcation of lease sketches.
4. After considering the recommendations, the Court allowed mining in undisputed areas only, with strict conditions and oversight by the Committee. The parties were directed to cooperate in the demarcation process, with a timeline set for completion.
5. The interim order was modified, allowing mining in undisputed areas under specified conditions, with the Committee overseeing the demarcation process. Parties were instructed to cooperate and not hinder the demarcation work.
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