Home Case Index All Cases Income Tax Section Wise 2007 2007 (7) 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 678 Records

• 2007 (7) TMI 701
  
  Issues involved:
  The issues involved in this case are whether the loans received by the appellant from Shri D.K. Sanghvi and M/s.Aqua Trade should be treated as undisclosed income of the appellant.
  
  Loan from Shri D.K. Sanghvi:
  The appellant-assessee received a loan of &8377; 25,000 from Shri D.K. Sanghvi. The Tribunal treated this loan as undisclosed income of the appellant on the ground that Shri D.K. Sanghvi was not assessed to income tax. However, the confirmation letter of Shri D.K. Sanghvi was submitted during the assessment proceedings, and the veracity of the letter was not questioned. Additionally, the loans were transacted through account payee crossed cheques, and the appellant offered to produce the broker involved in raising the loans. The High Court held that the non-assessment of Shri D.K. Sanghvi to tax alone was not sufficient to justify treating the loan as undisclosed income. Therefore, the addition of &8377; 25,000 from Shri D.K. Sanghvi was not upheld, and the appeal was decided in favor of the assessee.
  
  Loan from M/s.Aqua Trade:
  Similarly, the appellant received a loan of &8377; 25,000 from M/s.Aqua Trade, which was also treated as undisclosed income by the Tribunal due to M/s.Aqua Trade not being assessed to income tax. However, the High Court found that the confirmation letter from M/s.Aqua Trade was not questioned, and the transactions were conducted through cheques. The appellant had also provided details of the broker involved in securing the loans. The Court held that the non-assessment of M/s.Aqua Trade to tax was not sufficient to justify treating the loan as undisclosed income. Consequently, the addition of &8377; 25,000 from M/s.Aqua Trade was not sustained, and the appeal was decided in favor of the assessee.
  
  Conclusion:
  In conclusion, the High Court held that the additions of &8377; 50,000 in total from both Shri D.K. Sanghvi and M/s.Aqua Trade could not be justified solely on the grounds that the cash creditors were not assessed to tax. The Court ruled in favor of the assessee, stating that the loans received through proper channels with supporting documentation should not be considered as undisclosed income. The appeal was allowed with no costs imposed on the appellant.

  ---

• 2007 (7) TMI 700
  
  Issues Involved:
  
  1. Quashing of Criminal Case Nos. 2 & 1 of 2007.
  2. Constitutionality of Section 108 of the Customs Act, 1962.
  3. Issuance of non-bailable warrants by the Metropolitan Magistrate.
  4. Compliance with Section 202 of the Criminal Procedure Code (Cr.P.C.).
  
  Issue-wise Detailed Analysis:
  
  1. Quashing of Criminal Case Nos. 2 & 1 of 2007:
  
  The petitioners sought to quash Criminal Case Nos. 2 & 1 of 2007 pending before the Metropolitan Magistrate, Ahmedabad. They argued that no prima facie case under Sections 174 & 175 of IPC was made out against them, as they had already provided the necessary documents and expressed their willingness to appear before the Ludhiana DIR office due to health issues. The court found that the petitioners had repeatedly failed to comply with the summons issued under Section 108 of the Customs Act, thus justifying the initiation of criminal cases and the issuance of process by the Metropolitan Magistrate.
  
  2. Constitutionality of Section 108 of the Customs Act, 1962:
  
  The petitioners challenged Section 108 of the Customs Act on the grounds that it violated Articles 14 and 20(3) of the Constitution of India. They argued that the provision allowed for arbitrary summoning of individuals residing far away without reimbursement for travel expenses, unlike similar provisions in the Cr.P.C. The court upheld the constitutionality of Section 108, emphasizing that it aimed to collect information related to customs violations and was essential for safeguarding revenue. The court referenced several Supreme Court judgments affirming that the provision did not violate constitutional protections and was necessary for effective customs enforcement.
  
  3. Issuance of Non-bailable Warrants by the Metropolitan Magistrate:
  
  The petitioners contended that the Metropolitan Magistrate issued non-bailable warrants without first issuing bailable warrants, which was contrary to the Cr.P.C. The court noted that the petitioners had repeatedly failed to appear despite multiple summons and assurances. The Metropolitan Magistrate had issued the non-bailable warrants only after recording valid reasons and observing the petitioners' non-compliance. The court found the issuance of non-bailable warrants justified under the circumstances.
  
  4. Compliance with Section 202 of the Criminal Procedure Code (Cr.P.C.):
  
  The petitioners argued that the Metropolitan Magistrate did not comply with the mandatory requirement of Section 202 of the Cr.P.C., which necessitates an inquiry or investigation before issuing process against an accused residing outside the Magistrate's jurisdiction. The court observed that the complaints detailed the petitioners' non-compliance with summonses, providing sufficient grounds for proceeding without further inquiry. The court concluded that the Magistrate's actions were in line with the legislative intent to prevent harassment of innocent persons and that the complaints themselves disclosed a prima facie case.
  
  Conclusion:
  
  The court dismissed the petitions, upholding the constitutionality of Section 108 of the Customs Act and finding no procedural violations in the issuance of non-bailable warrants or the compliance with Section 202 of the Cr.P.C. The petitioners' repeated non-compliance with summonses and the valid reasons recorded by the Metropolitan Magistrate justified the actions taken against them.

  ---

• 2007 (7) TMI 699
  
  Issues involved: Challenge to reduction of penalty u/s Rule 25 of Central Excise Rules, 2001 read with Section 11AC of Central Excise Act, 1944.
  
  Summary:
  The Revenue challenged the reduction of penalty imposed on the respondent by the Commissioner (Appeals) from Rs. 1,37,560 to Rs. 25,000. The Revenue contended that the penalty was rightly imposed due to the respondent's suppression of material facts regarding the manufacture and clearance of branded goods. The Appellate Commissioner reduced the penalty citing Section 11AC, which provides for a maximum penalty equal to the duty determined, and relied on a Supreme Court decision. However, a Tribunal decision clarified that once mens rea is established, the penalty must be equal to the duty determined, with only specific provisions allowing for reduced penalties. The Tribunal emphasized that any discretion to impose a lesser penalty would defeat the purpose of deterrence intended by Section 11AC.
  
  The reliance on the Supreme Court decision in a different context was deemed misconceived, as it did not apply to the interpretation of penalty provisions under Section 11AC of the Central Excise Act. The Supreme Court's decision regarding a different statute's penalty provisions did not impact the Tribunal's interpretation of Section 11AC. Therefore, the reduction in penalty ordered by the Commissioner (Appeals) was deemed unwarranted, and the original penalty amount imposed by the adjudicating authority was restored. The appeal by the Revenue was allowed accordingly.

  ---

• 2007 (7) TMI 698
  
  Issues involved:
  The judgment involves the interpretation of section 40A(3) of the Income-tax Act regarding the disallowance of payments made to Ludhiana Foundry Small Industries Association Regd. The main issue is whether the payments are to be disallowed under section 40A(3) when the identity of the party and genuineness of the transactions are established.
  
  Summary:
  
  Issue 1: Addition under section 40A(3) of the Income-tax Act
  
  The Assessing Officer made an addition of Rs. 98,460 under section 40A(3) of the Income-tax Act. The Appellate Assistant Commissioner deleted the addition based on the evidence provided by the assessee, including a certificate from Ludhiana Foundry & Small Industries Association (Regd.) stating that cash payments were insisted by the Association. The Appellate Assistant Commissioner found that the appellant had produced sufficient evidence, including the identity of the payee, to support that the cash payments were necessary due to the Association's requirements. The Tribunal, however, set aside the Appellate Assistant Commissioner's decision, stating that the case did not fall within the exceptions provided in Rule 6DD(J) and a circular issued in this regard. The Tribunal accepted a reference under section 256(1) for the opinion of the High Court.
  
  Issue 2: Interpretation of previous judgments
  
  The High Court referred to previous judgments, including Aggarwal Steel Traders v. CIT and CIT v. Avtar Singh & Sons, which emphasized that if the assessee can provide confirmatory letters from concerned parties regarding cash payments, the case might be covered by exceptional circumstances as per Board Circular No. 220 dated 31-5-1977. In the present case, the High Court found that the evidence presented by the assessee, such as the certificate from Ludhiana Foundry and Small Industries Association (Regd.) and payment receipts, supported the claim that cash payments were necessary. The High Court concluded that the Tribunal had overlooked this evidence and that the question should be answered in favor of the assessee based on the precedents set by the Division Benches in the mentioned cases.
  
  Conclusion:
  
  The High Court ruled in favor of the assessee and against the revenue, stating that the evidence provided by the assessee, including the certificate and payment receipts, justified the cash payments made to Ludhiana Foundry Small Industries Association Regd. Consequently, the question was answered in favor of the assessee. The connected appeal, ITA No. 65 of 1999, was also dismissed.

  ---

• 2007 (7) TMI 697
  
  Issues involved: Challenge to order of framing charge u/s 13(2) read with 13(1)(e) of Prevention of Corruption Act, 1988.
  
  Summary:
  1. The appellant challenged the order of framing charge passed by the Special Judge, Chandigarh under Section 13(2) read with Section 13(1)(e) of the Prevention of Corruption Act, 1988. The appellant contended that no charge sheet could be filed against him without obtaining the requisite sanction as per Section 19 of the Act, as he was serving as a Colonel in the Army at the time of the alleged offence. The High Court dismissed the plea, emphasizing that the appellant was not in government service when the charge sheet was filed. The appellant's argument, based on the case of State of U.P. v. Mohammad Nooh, was also rejected.
  
  2. The Additional Solicitor General argued that the case of Mohammad Nooh did not apply to the present situation. The effect of Section 19(3) of the Act was discussed, highlighting that no court shall stay proceedings under the Act on the ground of any error in the sanction granted, unless it resulted in a failure of justice. The court referred to previous cases emphasizing the limited application of legal fictions and deeming provisions in law.
  
  3. The court further analyzed the provisions of the Act and previous legal precedents to determine the applicability of Section 19(3) and the requirement of sanction for prosecuting public servants. The court concluded that the High Court's decision did not have any infirmity warranting interference, and thus, the appeal was dismissed for lack of merit.

  ---

• 2007 (7) TMI 696
  
  Issues involved:
  The issues involved in the judgment are:
  1. Interpretation of employee participation expenditure in a hotel or restaurant u/s 37(2A) of the Income-tax Act, 1961.
  2. Disallowance of expenditure on rent of staff transit houses u/s 37(4) and 37(5) of the Income-tax Act.
  
  Interpretation of employee participation expenditure:
  The High Court considered whether the Tribunal erred in holding that the portion of expenditure related to employee participation in providing food, drinks, etc., to customers in a hotel or restaurant was not covered by the exception provided in Explanation 2 to section 37(2A) of the Income-tax Act. The Court noted that the question had to be answered in the negative, in favor of the revenue and against the assessee, based on the decision of the Supreme Court in CIT v. Patel Bros. & Co. Ltd. [1995] 215 ITR 1651. This decision clarified the treatment of such expenditures under the relevant provisions of the Act.
  
  Disallowance of expenditure on staff transit houses:
  Regarding the disallowance of expenditure on rent of staff transit houses or on the repairs thereof under sections 37(4) and 37(5) of the Income-tax Act, the High Court observed that the question had to be answered in the affirmative, in favor of the revenue and against the assessee. This conclusion was drawn in light of the Supreme Court decision in Britannia Industries Ltd. v. CIT [2005] 278 ITR 5462, which highlighted the specific provisions under sections 30 to 36 of the Act that govern the allowability of such expenditures. Therefore, the Court upheld the disallowance of these expenses as per the relevant statutory provisions.
  
  The High Court disposed of the reference accordingly, providing clarity on the interpretation and treatment of the specified expenditures under the Income-tax Act, 1961.

  ---

• 2007 (7) TMI 695
  
  Issues involved: Rejection of a refund claim based on classification of goods under specific headings u/s Customs Tariff Act and Central Excise Tariff Act.
  
  Issue 1: Classification of goods and refund claim
  
  The appeal was filed against the rejection of a refund claim by the assessee. The goods in question, 'epoxy insulated coils' along with accessories, were initially cleared under specific headings of the Customs Tariff Act and the Central Excise Tariff Act. The assessee sought re-assessment of the goods under a different heading for the purpose of claiming a refund of excess duty paid. The Asst. Commissioner rejected this claim, confirming the original classification of the goods under a particular heading. The appellate authority also upheld this decision, leading to the current appeal challenging the appellate Commissioner's order.
  
  Issue 2: Challenge through refund claim
  
  The records indicate that the assessment of the goods was not legally challenged by the assessee. Instead of appealing the assessment order, the assessee opted to challenge it through a refund claim, disputing the classification of the goods and seeking a refund based on a different heading. The appellants argued for the classification of the goods under a specific heading and claimed the benefit of a Customs Notification. However, the ld. SDR contended that such grounds should have been raised in an appeal against the assessment order, not in a refund claim without challenging the assessment. Citing a Supreme Court judgment, the ld. SDR emphasized that a refund claim contrary to the assessment order was not maintainable u/s Customs Act. As the appellants voluntarily cleared the goods under a specific heading and did not appeal the assessment order, challenging it through a refund claim was deemed impermissible in law. Consequently, the refund claim was deemed inadmissible based on the legal precedent cited by the ld. SDR.
  
  In conclusion, the appeal was dismissed due to the impermissible nature of challenging the assessment through a refund claim without following the appropriate legal procedures for appeal.

  ---

• 2007 (7) TMI 694
  
  Issues involved:
  Petition against order u/s 482 Cr. P.C. for interim custody of seized vehicle dismissed by trial court.
  
  Details of the judgment:
  
  1. Issue 1: Ownership of the seized vehicle
  - The petitioner claimed to be the registered owner of the vehicle seized while transporting poppy straw.
  - Police found discrepancies in vehicle registration during seizure.
  - Petitioner shifted stance from not being the owner initially to claiming ownership later.
  - Court held that petitioner cannot seek interim custody based on registration certificate if he denied ownership during investigation.
  - Vehicle liable for confiscation under NDPS Act due to transportation of commercial quantity of poppy straw.
  
  2. Issue 2: Confiscation of vehicle under NDPS Act
  - Sub-section (3) of Section 60 of NDPS Act states conditions for confiscation of conveyance used in drug transportation.
  - Petitioner's claim of not being the owner at the time of seizure supported by agreement for sale.
  - Court emphasized that owner must prove lack of knowledge or connivance in drug transportation to avoid confiscation.
  - Previous court rulings highlight the importance of preventing drug-related offenses through strict measures like confiscation.
  
  3. Decision:
  - Court dismissed the petition for interim custody of the vehicle based on the petitioner's shifting ownership stance and the vehicle's involvement in drug transportation.
  - Rulings cited by petitioner's counsel deemed irrelevant given the specific circumstances of the case.
  - Petitioner not entitled to custody as the actual owner, Dinesh Kumar, did not seek custody and the vehicle is subject to confiscation under NDPS Act.

  ---

• 2007 (7) TMI 693
  
  Issues Involved:
  1. Allegations of mismanagement and oppression in Belgachi Tea Company Ltd. and New Terai Association Ltd.
  2. Financial and statutory defaults, including non-payment of provident fund dues.
  3. Validity of share allotment in New Terai Association Ltd.
  4. Requests for compulsory purchase of shares.
  5. Jurisdiction and discretionary power of the Company Law Board and High Court.
  
  Detailed Analysis:
  
  Allegations of Mismanagement and Oppression:
  The appellants, a group of shareholders, alleged mismanagement and acts of oppression in Belgachi Tea Company Ltd. and New Terai Association Ltd. They claimed poor performance, financial losses, and defaults in payment of workers' dues, salaries, and statutory obligations, including provident fund dues. The appellants also alleged that these defaults exposed the company and its directors to criminal proceedings.
  
  The respondents countered that the losses were endemic to the region and not indicative of mismanagement. They argued that the appellants were part of the management during the period of alleged defaults and that no funds were siphoned off. The Board found that incurring losses and liabilities did not necessarily mean mismanagement and attributed the issues to inefficient management rather than deliberate mismanagement or oppression.
  
  Financial and Statutory Defaults:
  The appellants highlighted defaults in payment of provident fund dues, which led to criminal proceedings against directors, including members of the appellants' group. The respondents argued that these defaults were due to overall losses in the tea industry and not acts of mismanagement. The Board accepted the respondents' explanation and did not find these defaults to constitute mismanagement or oppression.
  
  Validity of Share Allotment in New Terai:
  The appellants alleged that shares were allotted without proper notice or a general meeting, violating SEBI regulations and guidelines. They claimed that the allotment was done to persons close to the Saraff family, reducing the appellants' shareholding and voting power. The Board did not examine these allegations in detail and justified the allotment on the grounds that the company needed funds and the appellants were offered the chance to acquire shares proportionate to their holdings.
  
  The High Court found the Board's decision to ignore these allegations without examination to be perverse. The Court held that the Board should have examined whether the allotment violated SEBI regulations and whether it constituted oppression of minority shareholders.
  
  Requests for Compulsory Purchase of Shares:
  The appellants argued that the strained relationship between the groups warranted a compulsory purchase of shares to resolve the dispute. The Board had given liberty to the respondents to purchase the appellants' shares but did not set a time frame or default clause. The High Court found this relief to be illusory and inconsistent with the Board's finding of strained relationships.
  
  The High Court recognized the discretionary power of the Board to order compulsory purchase of shares in exceptional cases, especially in closely-held family companies. The Court noted that the Board's order lacked a proper mechanism for resolving the dispute and directed the Board to reconsider the matter.
  
  Jurisdiction and Discretionary Power:
  The High Court emphasized that while it could hear appeals on points of law, it could examine facts to determine if the Board's findings were perverse. The Court found that the Board failed to consider relevant factors and gave inconsistent reliefs. It remanded the matter back to the Board for fresh consideration, directing it to examine the allegations of statutory violations and oppression and to provide a clear and enforceable resolution.
  
  Conclusion:
  The High Court set aside the Board's order concerning Belgachi Tea Company Ltd. and New Terai Association Ltd. and remanded the matter back to the Board for a fresh decision. The Court directed the Board to consider the allegations of statutory violations and oppression and to provide a clear mechanism for resolving the dispute, including the possibility of compulsory purchase of shares. The appellants' application to introduce new facts was dismissed, and the cross-objections by the respondents were also dismissed.

  ---

• 2007 (7) TMI 692
  
  The Delhi High Court ruled in favor of the revenue and against the assessee, stating that the assessee was not an industrial company entitled to be taxed at a concessional rate. The Court referred to the decision of the Supreme Court in CIT v. N.C. Budharaja & Co. [1993] 204 ITR 412. The second question was deemed irrelevant based on the first question's decision.

  ---

• 2007 (7) TMI 691
  
  The Bombay High Court allowed the petitioners to deposit Rs. 56,13,227 within four weeks for possession of the premises. The Income Tax Department must execute necessary documents upon receiving the sum.

  ---

• 2007 (7) TMI 690
  
  Issues Involved:
  1. Legality of land acquisition without a "building scheme" under Section 192 of the Punjab Municipal Act, 1911.
  2. Proper publication of Notification under Section 4 of the Land Acquisition Act, 1894.
  3. Opportunity to file objections under Section 5A of the Land Acquisition Act.
  4. Alleged discrimination in land acquisition.
  
  Detailed Analysis:
  
  1. Legality of Land Acquisition Without a "Building Scheme" Under Section 192 of the Punjab Municipal Act, 1911:
  The appellants contended that land acquisition for Scheme Nos. 2 and 3 was invalid as no "building scheme" under Section 192 of the Punjab Municipal Act, 1911 was framed. They argued that without such a scheme, the acquisition could not be for a public purpose. The respondents countered that the scheme was a development plan to provide facilities like residential and commercial accommodations and hospitals, covered under Section 52(2)(c) of the Act of 1911. The High Court upheld the respondents' view, stating that the acquisition was for a development plan and not a "building scheme" under Section 192. The Supreme Court affirmed this, noting that the acquisition was for purposes within the contemplation of Section 52(2)(c) of the Act of 1911 and did not require the procedure under Section 192.
  
  2. Proper Publication of Notification Under Section 4 of the Land Acquisition Act, 1894:
  The appellants challenged the publication of the Notification under Section 4, arguing that the substance was not published in the locality as required. The respondents claimed that the Notification was publicized by beat of drums on June 3 and June 4, 1989. The High Court found that the publication was valid, based on the notings in the file and the affidavit of the Land Acquisition Officer, despite the original records being missing. The Supreme Court agreed, emphasizing that the relevant factor was the due publicity given in the locality, not the status of the person performing the beat of drums.
  
  3. Opportunity to File Objections Under Section 5A of the Land Acquisition Act:
  The appellants argued that they were not given an opportunity to file objections under Section 5A or represent their cases. The High Court, after examining the evidence, found that notices were given, objections were filed and heard, and awards were declared in many cases. The Supreme Court, after reviewing the evidence, concurred with the High Court's findings, stating that the appellants' grounds were untenable and no interference was warranted.
  
  4. Alleged Discrimination in Land Acquisition:
  One appellant claimed discrimination, stating that lands with buildings were not acquired, and similar shops were left out of acquisition. The High Court found that the lands not acquired had permanent structures sanctioned by the concerned authority before the Notifications. The Supreme Court upheld this finding, noting that the appellant did not prove that his structure was similarly sanctioned. The Court also dismissed the argument regarding the release of lands under Section 48 of the Act, finding no merit in the claim of discrimination.
  
  Conclusion:
  The Supreme Court dismissed the appeals, affirming the High Court's findings that the land acquisition was valid, the publication of the Notification was proper, the appellants were given opportunities to file objections, and there was no discrimination in the acquisition process. The Court found no merit in the appellants' claims and upheld the legality of the acquisition under the relevant statutory provisions.

  ---

• 2007 (7) TMI 689
  
  Issues involved: Quashing of proceedings in C.C. No. 253 of 2004 u/s 138 of the Negotiable Instruments Act based on the issuance of post-dated cheques under coercion and threat.
  
  Summary:
  
  Issue 1: Alleged offence under Section 138 of the Negotiable Instruments Act
  
  The petitioner sought to quash the proceedings in C.C. No. 253 of 2004, where a private complaint was filed against him for an alleged offence u/s 138 of the Negotiable Instruments Act. The petitioner claimed that he was coerced by the police to issue post-dated cheques to the respondent and others, not for any legally enforceable debt, but to satisfy the complainant who had lodged a complaint against the petitioner's brother for cheating.
  
  Issue 2: Liability of the petitioner for dishonour of cheques
  
  The respondent argued that the petitioner, by stepping into the shoes of his brother and undertaking to discharge the liability, became liable for the dishonour of the cheques issued. The court examined the complaint's contents, which detailed how the petitioner's brother deceitfully received money and issued cheques totaling a significant amount to various individuals, including the respondent.
  
  Issue 3: Legally enforceable debt or liability
  
  The court noted that the complaint itself admitted that the petitioner had no direct liability towards the respondent. The cheque was issued after the complaint against the petitioner's brother for cheating, raising doubts about the existence of a legally enforceable debt or liability on the petitioner's part. Despite the presumption u/s 139 of the Negotiable Instruments Act, the court found that the liability appeared to be legally not enforceable.
  
  Conclusion:
  
  Based on the above analysis, the court held that the petitioner was not liable u/s 138 of the Negotiable Instruments Act. Consequently, the proceedings in C.C. No. 253 of 2004 were quashed, and the criminal original petition was allowed, leading to the closure of connected miscellaneous petitions.

  ---

• 2007 (7) TMI 688
  
  Issues involved: Validity of jurisdiction transfer u/s 127 of the Income-tax Act, 1961 from Bombay to Delhi for assessment during the block period 1-4-1987 to 10-2-1998.
  
  Summary:
  The High Court of Delhi heard an appeal by the revenue against an order of the Income-tax Appellate Tribunal related to the transfer of jurisdiction of an assessee from Bombay to Delhi u/s 127 of the Income-tax Act, 1961 for the block period 1-4-1987 to 10-2-1998. The Tribunal found that despite multiple opportunities, the revenue failed to produce the alleged transfer order u/s 127 of the Act. Consequently, the Tribunal concluded that since no transfer order existed, the Assessing Officer in Delhi lacked jurisdiction, leading to the quashing of the assessment order.
  
  During the High Court proceedings, the revenue's counsel sought an adjournment to produce the order u/s 127 of the Act, but failed to obtain it. The revenue contended that the assessee did not challenge the transfer order before any departmental authorities, which was rejected by the Court as the case revolved around the existence of the order itself. The Court upheld the Tribunal's decision, emphasizing the absence of the transfer order and the lack of valid jurisdiction for the Assessing Officer in Delhi. No substantial question of law was found to arise for consideration.
  
  In conclusion, the High Court affirmed the Tribunal's decision, highlighting the crucial absence of the transfer order u/s 127 of the Income-tax Act, 1961, which rendered the assessment by the Delhi Assessing Officer invalid for the block period in question.

  ---

• 2007 (7) TMI 687
  
  Issues involved: Reopening of assessment without recording reasons u/s 24 of the Delhi Sales Tax Act, 1975.
  
  The judgment by the Delhi High Court, delivered by Justice Madan B. Lokur, addressed the grievance of the Petitioner regarding the reopening of a regular assessment without recording any reasons. The Petitioner argued that this action was impermissible under Section 24 of the Delhi Sales Tax Act, 1975, citing a Division Bench judgment in the case of M/s. Samagya Consultant Pvt. Ltd. vs. Commissioner of Sales Tax and Another. The notice for reopening simply stated that the turnover had escaped assessment without providing any specific reasons for this conclusion. The Petitioner contended that no reasons were recorded before issuing the notice, which was a violation of the law and the Circular No. 7 of 2001-02 issued by the Commissioner of Sales Tax emphasizing the necessity of recording reasons before reopening an assessment.
  
  The Respondents, in their counter affidavit, argued that recording reasons before initiating reassessment proceedings was not a requirement under the Delhi Sales Tax Act, 1975, unlike the Income Tax law. However, the Court disagreed with this interpretation, stating that it was contrary to the previous decision and the Circular issued by the Commissioner of Sales Tax. The Court emphasized that circulars issued by governmental authorities are binding on subordinate authorities and that there must be a valid reason for reopening a completed assessment, as highlighted in the M/s. Samagya Consultant Pvt. Ltd. case.
  
  The Court further elaborated that the power to reopen an assessment is not a plenary power and requires the Assessing Officer to have material on record, consider that material, and then record reasons for the reopening. In this case, the Court found that reasons were not recorded before issuing the notice, leading to the decision to quash the notice and subsequent proceedings. The Court granted the relief prayed for by the Petitioner and awarded costs amounting to Rs. 3000 to be paid within six weeks.

  ---

• 2007 (7) TMI 686
  
  Issues Involved:
  1. Applicability of the Securitisation Act to co-operative banks.
  2. Alleged arbitrariness and violation of Article 14 of the Constitution by the Securitisation Act.
  3. Deprivation of the right to adjudicate claims under the MCS Act by the Securitisation Act.
  4. Validity of notices under Section 13 of the Securitisation Act without specifying the exact amount.
  5. Requirement of final adjudication of the claim amount before action under Section 13 of the Securitisation Act.
  6. Legislative competence of Parliament to enact the Securitisation Act concerning co-operative banks.
  
  Issue-wise Detailed Analysis:
  
  Re: 1. Applicability of the Securitisation Act to co-operative banks:
  A consideration of the provisions of the Securitisation Act establishes beyond doubt that the same is made applicable to co-operative banks. Section 2(1)(c) of the Securitisation Act includes "such other bank which the Central Government may, by notification, specify for the purposes of this Act." The Central Government issued a notification on 28-1-2003 specifying "Co-operative Bank" as defined in Section 5 of the Banking Regulation Act, 1949. The Supreme Court in Greater Bombay Cooperative Bank Ltd. v. United Yarn Tex. Pvt. Ltd. acknowledged that the Securitisation Act includes co-operative banks within its ambit. Therefore, the first contention is rejected.
  
  Re: 2. Alleged arbitrariness and violation of Article 14 of the Constitution by the Securitisation Act:
  The petitioners contended that the Securitisation Act is arbitrary and violative of Article 14 as it deprives borrowers of the right to challenge the bank's action under Section 13. However, the Supreme Court in Mardia Chemicals Ltd. v. Union of India upheld the constitutional validity of the Securitisation Act, including Sections 13 and 17. The court observed that Section 17 provides an adequate mechanism for borrowers to challenge the actions of the banks. The amendments to Sections 13 and 17 post-Mardia Chemicals further addressed the concerns raised. Thus, the second contention is also rejected.
  
  Re: 3. Deprivation of the right to adjudicate claims under the MCS Act by the Securitisation Act:
  The petitioners argued that adopting proceedings under the Securitisation Act deprives borrowers of the right to adjudicate claims under the MCS Act. However, the Supreme Court in Mardia Chemicals and subsequent judgments clarified that the Securitisation Act's purpose is to enable secured creditors to take possession of securities without court intervention. Section 13(10) allows creditors to file applications for recovery of the balance amount before the Debt Recovery Tribunal or a competent court. The scope of adjudication under Section 17 is limited to the validity of the secured creditor's actions, not the exact quantum of the claim. Therefore, the third contention is rejected.
  
  Re: 4. Validity of notices under Section 13 of the Securitisation Act without specifying the exact amount:
  The petitioners contended that notices under Section 13 are invalid if they do not specify the exact amount due. However, the court clarified that the purpose of an application under Section 17 is not to determine the exact amount due but to ascertain the validity of the secured creditor's actions. The exact amount due can be adjudicated in subsequent proceedings under Section 13(10). Therefore, the fourth contention is rejected.
  
  Re: 5. Requirement of final adjudication of the claim amount before action under Section 13 of the Securitisation Act:
  The petitioners argued that no action under Section 13 can be taken without a final adjudication of the claim amount. However, the court reiterated that the Securitisation Act's purpose is to enable secured creditors to enforce their securities without court intervention. The exact amount due can be adjudicated in subsequent proceedings under Section 13(10). Therefore, the fifth contention is rejected.
  
  Re: 6. Legislative competence of Parliament to enact the Securitisation Act concerning co-operative banks:
  The petitioners contended that the Securitisation Act is without legislative competence as Parliament has no authority to enact it concerning co-operative banks. However, the court noted that the Supreme Court in Mardia Chemicals upheld the constitutional validity of the Securitisation Act. The court also referred to judgments that clarified that the Securitisation Act deals with the field of banking, which falls under Parliament's legislative competence. The Act does not trench upon the State subject of co-operative societies under Entry 32 of List II. Therefore, the sixth contention is rejected.
  
  Conclusion:
  The court dismissed the writ petitions, upholding the applicability and constitutional validity of the Securitisation Act concerning co-operative banks. The court also rejected the contentions regarding the arbitrariness of the Act, deprivation of the right to adjudicate claims under the MCS Act, and the requirement of final adjudication of the claim amount before action under Section 13. The court granted a six-week period for the petitioners before the respondents could take further action under Section 13(4) of the Securitisation Act.

  ---

• 2007 (7) TMI 685
  
  Issues Involved:
  1. Maintainability of the suit.
  2. Territorial jurisdiction.
  3. Misguide of cause of action and multifariousness.
  4. Limitation period.
  5. Authorization of plaint signing and verification.
  6. Entitlement to recovery amount.
  7. Entitlement to interest and its rate.
  8. Relief.
  
  Issue-wise Detailed Analysis:
  
  1. Maintainability of the Suit:
  The defendant objected to the suit based on Section 10 of the Code of Civil Procedure (CPC) due to a prior suit filed by Dany Dairy in Saharanpur. However, since the Saharanpur suit was dismissed in default and Dany Dairy was ordered to be wound up, the objection was not pressed, rendering the issue non-surviving.
  
  2. Territorial Jurisdiction:
  The plaintiff argued that the bank guarantees were issued and invoked in Delhi, and the defendant had a zonal office in Delhi, thus conferring jurisdiction to Delhi courts. The defendant contended that the guarantees were issued and payable in Saharanpur. The court held that since the guarantees did not specify a place of payment and could be paid at any place, including Delhi, and considering the defendant's presence in Delhi, the Delhi courts had jurisdiction.
  
  3. Misguide of Cause of Action and Multifariousness:
  This issue was not pressed by the defendant.
  
  4. Limitation Period:
  The defendant argued that the suit was barred by limitation, asserting that the cause of action arose when the bank guarantees were invoked (21.03.1990) and the suit was filed beyond the limitation period on 22.05.1993. The court excluded the period during which an injunction was in operation (17.01.1991 to 13.02.1992) and held that the suit was filed within the limitation period. Additionally, the court noted that the liability under the bank guarantees was not written off and continued to be reflected in the defendant's balance sheets, potentially extending the limitation period under Section 18 of the Limitation Act.
  
  5. Authorization of Plaint Signing and Verification:
  The plaint was signed and verified by the company secretary of the plaintiff, which was deemed in compliance with Order XXIX Rule 1 of the CPC. The defendant did not contest this issue, and it was decided in favor of the plaintiff.
  
  6. Entitlement to Recovery Amount:
  The court examined the terms of the bank guarantees, which required payment upon a demand by the plaintiff stating that the amount was due to loss or damage caused by Dany Dairy's breach of contract. The plaintiff had sent demand notices in accordance with the terms. The court held that the plaintiff was entitled to the amounts under the three bank guarantees: Rs. 25,00,000 under Bank Guarantee No. 614, Rs. 16,50,000 under Bank Guarantee No. 615, and Rs. 12,00,000 under Bank Guarantee No. 626.
  
  7. Entitlement to Interest and Its Rate:
  The plaintiff claimed interest at 20% per annum. The court considered the interest rates at the time of the bank guarantees' execution (17-18%) and the subsequent decline in interest rates. The court awarded simple interest at 17% per annum from 01.05.1989 till the filing of the suit (21.05.1993) and 12% per annum from the date of filing till realization on the principal amount of Rs. 53,50,000.
  
  8. Relief:
  The court decreed in favor of the plaintiff for Rs. 53,50,000 along with simple interest at 17% per annum from 01.05.1989 to 21.05.1993 and 12% per annum from 22.05.1993 till realization, along with costs.

  ---

• 2007 (7) TMI 684
  
  Issues Involved:
  1. Jurisdiction
  2. Anti-suit injunction
  3. Personal jurisdiction over defendants
  4. Forum convenience
  5. Connection between Defendant Nos. 1 and 2
  6. Remedy under UDRP
  7. Injunction from using the domain name "indiatvlive.com"
  8. Descriptive names
  9. Agreement with Jump TV
  10. Delay
  
  Issue-wise Detailed Analysis:
  
  1. Jurisdiction:
  The court discussed the concept of jurisdiction, emphasizing its relevance in the context of e-commerce and global business activities. The plaintiff, running a Hindi news channel "INDIA TV," claimed jurisdiction based on its extensive use and registration of the mark "INDIA TV" since 2002. The plaintiff discovered the defendants' use of a similar domain name "indiatvlive.com" and alleged infringement, passing off, and dilution of its mark.
  
  2. Anti-suit Injunction:
  The plaintiff sought an anti-suit injunction to restrain Defendant No. 1 from proceeding with a suit filed in Arizona. The court referred to the principles governing anti-suit injunctions, emphasizing that the court must be satisfied that the defendant is amenable to personal jurisdiction, that justice would be defeated if the injunction is declined, and that comity must be respected. The court found that it had personal jurisdiction over the defendants and that the ends of justice would be served by granting the anti-suit injunction.
  
  3. Personal Jurisdiction Over Defendants:
  Defendant No. 1 argued that the court lacked personal jurisdiction as it was a Delaware corporation with no presence in India. The court, however, found that the defendants had sufficient minimum contacts with India, including targeting Indian audiences and having a strategic relationship with Indian entities. The court held that the defendants were carrying on activities within its jurisdiction and thus, it could exercise personal jurisdiction over them.
  
  4. Forum Convenience:
  The court considered whether it was the appropriate forum for the dispute. Defendant No. 1 argued that the District Court in Arizona was more convenient. The court, however, found that neither the plaintiff nor the defendants had significant connections with Arizona. The plaintiff was based entirely in India, and the alleged injury occurred in India. Thus, the court determined that it was the forum convenience for the dispute.
  
  5. Connection Between Defendant Nos. 1 and 2:
  The plaintiff presented evidence suggesting a connection between Defendant No. 1 and Defendant No. 2, including shared addresses and strategic relationships. The court found prima facie evidence of a connection between the defendants, noting that this aspect would be decided after trial.
  
  6. Remedy Under UDRP:
  Defendant No. 1 argued that the plaintiff should have sought remedy under the Uniform Domain Name Dispute Resolution Policy (UDRP). The court, however, noted that the UDRP provides limited remedies, such as cancellation or transfer of domain names, and does not address issues like passing off or damages. The court held that the present suit was the most appropriate remedy given the reliefs sought by the plaintiff.
  
  7. Injunction from Using the Domain Name "indiatvlive.com":
  The court considered whether the defendants' use of the domain name "indiatvlive.com" constituted infringement. It noted that domain names are business identifiers and that the defendants' use of a similar domain name could mislead consumers. The court allowed the defendants to use the domain name with a disclaimer prominently displayed on their website, indicating no connection with the plaintiff's channel.
  
  8. Descriptive Names:
  Defendant No. 1 argued that the mark "INDIA TV" was descriptive and not capable of registration. The court, however, held that even descriptive marks could be protected if they had acquired distinctiveness and secondary meaning. The court found that the plaintiff's mark "INDIA TV" had acquired distinctiveness and was entitled to protection, subject to evidence to be led at trial.
  
  9. Agreement with Jump TV:
  Defendant No. 1 claimed that the suit was motivated by the plaintiff's agreement with a competitor, Jump TV. The court found that the agreement was entered into before the launch of the defendants' website and that there was insufficient evidence to establish that the suit was a consequence of the agreement with Jump TV.
  
  10. Delay:
  Defendant No. 1 argued that the plaintiff was guilty of undue delay in filing the suit. The court, however, found that the plaintiff could not have been expected to know about the launch of the defendants' website from the available materials. The court held that there was no excessive delay on the part of the plaintiff in bringing the action for passing off.
  
  Conclusion:
  The court granted the anti-suit injunction, restraining Defendant No. 1 from proceeding with the suit in Arizona. It modified the interim order to allow the defendants to use the domain name "indiatvlive.com" with a disclaimer. The court also directed Defendant No. 1 to file six-monthly statements of revenue earned from the impugned website in India. The observations were noted to be prima facie and would not affect the final disposal of the suit.

  ---

• 2007 (7) TMI 683
  
  Issues involved:
  The sanction of a scheme of amalgamation under Sections 391 to 394 of the Companies Act, 1956.
  
  Details of the Judgment:
  
  1. The petitioner sought court sanction for a scheme of amalgamation under Sections 391 to 394 of the Companies Act, 1956.
  
  2. The transferor company had all equity shareholders' consent and no secured or unsecured creditors, thus dispensing with the need for a meeting of equity shareholders.
  
  3. The transferee company also had all shareholders' consent and no secured or unsecured creditors, eliminating the requirement for a meeting of equity shareholders.
  
  4. The Regional Director raised an objection regarding the exchange ratio of shares between the companies, stating that no valuation report was submitted. However, it was argued that all shareholders had consented, and no challenge was made to the amalgamation, hence a valuation report was deemed unnecessary.
  
  5. The official liquidator confirmed that the affairs of the transferor company were conducted properly and not prejudicial to the interests of its members or the public.
  
  6. The court found no objections to the scheme and confirmed that all statutory compliances were met, making Company Petition No. 806 of 2006 and Company Petition No. 807 of 2006 absolute in terms of prayer Clauses (a) to (d).

  ---

• 2007 (7) TMI 682
  
  Issues involved: Distribution of amount in the account of a company in liquidation among secured creditors and workers, interpretation of provisions of the Companies Act regarding secured creditors' rights, consideration of claims post winding-up order, treatment of secured creditors who have filed affidavits.
  
  Distribution of Amount:
  The application sought direction for the disbursement of the amount in the company's account in liquidation among secured creditors and workers after deducting expenses. The total amount of Rs. 2,53,48,891 was proposed to be distributed at a ratio of 82.79% for secured creditors and 17.21% for workers.
  
  Interpretation of Companies Act:
  The argument was made that only secured creditors with first charge should be considered for distribution, excluding those with second charge. However, the court rejected this contention, emphasizing that the Act refers to "every secured creditor" and not specifically to those with first charge.
  
  Rights of Secured Creditors:
  Reference was made to a Supreme Court decision regarding the inter se rights of secured creditors with first and second charges. The court clarified that the decision does not exclude the consideration of secured creditors with second charges during distribution, and such rights may need to be addressed separately under the Transfer of Property Act.
  
  Treatment of Affidavits by Secured Creditors:
  It was argued that secured creditors who file affidavits surrender their rights over security and should not be treated as secured creditors during distribution. The court disagreed, stating that filing affidavits does not equate to relinquishing security rights.
  
  Consideration of Claims Post Winding-Up Order:
  A claim by a bank post the winding-up order was questioned, but the court found the claim to be based on a typographical error and confirmed that all claims considered were up to the date of the winding-up order.
  
  Disbursement Order:
  The court permitted the disbursement of the amount among secured creditors, with a specific provision for the amount related to ICICI Bank. The remaining amount was to be distributed among other secured creditors, with a timeline of four weeks for completion. The order was subject to final decisions by appropriate forums regarding rights of recovery.
  
  Professional Fees:
  The court allowed for the payment of the Chartered Accountant's professional fees.
  
  Conclusion:
  The application was disposed of in accordance with the disbursement plan outlined by the court, with a clear directive for the treatment of secured creditors and workers in the liquidation process.

  ---

123456........ 34