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2014 (7) TMI 1375
Suit for declaration that the “Structured Currency Option” Agreements entered into between the plaintiff and the defendant Bank are agreements by way of wagers hit by the bar of Section 30 of the Indian Contract Act, 1872, or not - seeking permanent injunction restraining the defendant Bank from in any manner acting upon or seeking to enforce any transaction under the said agreements - HELD THAT:- The preamble to the DRT Act describes the same as “an Act to provide for the establishment of tribunals for expeditious adjudication and recovery of debts due to banks and financial institutions and for matters connected therewith or incidental thereto”; Section 3 thereof provides for establishment of tribunals to be known as DRTs, to exercise the jurisdiction, power and authority conferred thereon by the Act - Had the DRT no jurisdiction, power and authority to adjudicate on the defence of the defendant, there would have been no need to provide for legal representation by the defendant or for the defendant to examine witnesses.
The DRT vide Section 17 has the jurisdiction, power and authority to decide on the defence to an application for recovery of debt filed before it. Once the DRT is held to have such a power, the jurisdiction of the Civil Court to declare existence of a state of affairs which is a defence to a claim before the DRT, has to be necessarily held to be barred.
The Supreme Court recently in STANDARD CHARTERED BANK VERSUS DHARMINDER BHOHI AND OTHERS [2013 (9) TMI 1289 - SUPREME COURT] has reiterated that the intendment of the DRT Act is speedy recovery of dues to the bank and the DRTs and DRATs are expected to see to it that an ingenious litigant does not take recourse to dilatory tactics. It was further held that any delay would fundamentally frustrate the purpose of the legislation. The Supreme Court with the said observations set aside the part of the order of the DRAT giving liberty to the auction purchaser of a property to file a civil suit.
If the jurisdiction of this Court to grant the consequential relief of injunction is barred, can this Court have jurisdiction to grant the relief of declaration and / or should this Court grant the relief of declaration, which, without the consequential relief of injunction, would be a toothless declaration, incapable of saving the plaintiff from the claim of the defendant Bank if the DRT was to conclude otherwise and thus, but a mere scrap of paper - this Court ought to refuse to grant the relief of declaration also, which is but a discretionary relief. It cannot be forgotten that grant of every injunction entails declaration of rights and no injunction can be granted without adjudicating conflicting rights of the parties. Thus, where grant of injunction is prohibited, such prohibition cannot be circumvented by instead granting declaration. This follows from Section 34 of the Specific Relief Act also which bars making of such a declaration where the plaintiff, able to seek further relief, omits to do so. The only difference here is that though the plaintiff has claimed further relief, such further relief is barred by Section 34 of the SARFAESI Act.
The suit is thus found to be not maintainable. The amendment claimed to the plaint does not affect its maintainability. Thus, the suit is dismissed and resultantly the pending applications are infructuous. The plaintiff is also burdened with costs of the suit. Counsel‟s fee assessed at Rs.20,000/-.
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2014 (7) TMI 1374
Seeking for specific performance of the terms and conditions of the allotment letter as well as the Addendum specifically pertaining to execution of conveyance deed and possession in terms of allotment letter and the Addendum - HELD THAT:- The issue concerning whether there was a subsisting lease between Omaxe and M/s Aero Club Woodland, the learned Arbitrator has considered the documentary evidence to return a finding that no tenancy had ever come into being. The learned Arbitrator had given reasons for the same which have been noted by the learned Single Judge in paragraph 28 and 29 of the impugned decision.
We simply highlight that no argument was advanced before us that a principle of law was ignored or misapplied by the learned Arbitrator. The entire gamut of the arguments in the appeal was a rehash of the contentions urged before the Arbitrator as also before the learned Single Judge. The thrust of the argument was that the findings returned are wrong. Whether the findings were right or wrong required us to re-appreciate the entire evidence led and reinterpret the contract as if we were to interpret the contract for the first time; a task which we refuse to perform because law prohibits us from doing so.
The appeal is dismissed with cost assessed at ₹ 50,000/- to be paid by the appellant to the respondents.
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2014 (7) TMI 1373
Works Contract - Composite supply - Deductions of TDS from the payment of valuable consideration made to the petitioner for execution of various works contracts for the State after deducting the amount therefrom towards labour and service charges including earth work - Section 44 of the Jharkhand Value Added Tax 2005 read with Rule 23 of the Jharkhand Value Added Tax Rules 2006 - whether the Decuction of tax at source on the whole bill amount without deducting the value of earth work which involves labour and service is arbitrary? - HELD THAT:- The Scheme of the JVAT Act being self contained, stands on a different footing. In terms of Section 29 of the Act, it is mandated upon every registered dealer to file periodical returns adjusting input credit and making deductions as prescribed under the Act. Section 44 stipulates deduction of tax at source to be made by the contractee for execution of the works contract in the State involving transfer of property in goods whether as goods or in some other form. The works contract referred to in Section 44 is a composite contract which involves transfer of property in goods whether as goods or in some other form and also labour and service. As per Section 44(5), any tax deducted at source paid to the State Government shall be adjustable by the payee on the authority of the certificate issued to him under subsection (4) with the tax payable to him under the Act.
Having regard to the various provisions of the Act under the VAT regime, there is no question of the dealers waiting for years to get back the refund of any excess amount deducted from him. In this regard, Revenue has submitted the monthly returns filed by the petitioner which shows that in the monthly returns filed by the petitioner, tax deducted at source was adjusted from the tax payable by the petitioner.
The tax deduction at source commonly referred to as “TDS” is also known as “withholding tax”. The TDS provisions are meant for tentative deduction of tax subject to regular assessment. The Act does not conceive a situation that there would be a pre-assessment prior to the assessment by the Assessing Authority - there are no merit in the contention of the petitioner that the contractee is under an obligation to exclude the component of labour and service charges involved in the execution of a composite works contract while making deduction of tax at source as prescribed under notification dated 31.03.2006 and TDS @ 4% on the entire bill amount is illegal and not supported by authority of law.
Whether the Letter dated 11.03.2013 directing deduction of VAT @ 4% on the entire value of the Bill is contrary to law? - HELD THAT:- The Revenue has contended that since the contract of the petitioner is a composite contract involving structural work along with earth work, deduction at 4% on the whole amount, in which earth work is also included, is necessary. In terms of Section 44(5), any tax is paid to the State in accordance with sub-section (3) shall be adjustable by the payee on the authority of the certificate issued to him under sub-section (4); tax payable by him under JVAT Act where any component of labour or service is involved in the earth work and if so, what is the extent of such labour and service involved will be examined at the time of filing returns with supporting documents. When tax is deducted at source by the contractee, it is not physically possible to segregate the elements of labour and service.
There is no merit in the contention that various items of the earth work in the agreement of the petitioner involved only labour and services and therefore, the petitioner is not liable to pay tax for the earth work. Though the earth work might involve certain amount of labour and service, it has to be substantiated by the documents. As rightly contended by the Revenue, the works contract is a composite work involving transfer of property in goods as well as labour and services - Merely going by the description of the items of earth work contained in the agreement, it cannot be said that the items contained in Part A of the Contract, earth work is purely earth work involving only labour and services.
Notification not making provision for deduction of labour and service charges - notification dated 31.3.2006 - HELD THAT:- The Notification SO 208 dated 31.3.2006 was issued in exercise of powers conferred by sub-section (1) of Section 44 of the Act. Section 44(1) of the Act stipulates that the State Government may by notification in the official gazette specify TDS to be deducted by the contractee from any valuable consideration paid to the contractors for the execution of works contract in the State. Since the notification was issued in exercise of power under Section 44(1) of the Act, the notification is not be read in isolation but to be read along with the Scheme and other provisions of the Act - The Scheme of the Act provides for filing of monthly/periodical/annual returns, deductions to be made as prescribed under the Act and assessment by the competent authorities. In terms of Section 2(lvi), "taxable turnover" means turnover on which dealer shall be liable to pay tax as determined after making such deductions from his total turnover and in such manner as may be prescribed.
As per Rule 22(1)(d), the value of goods involved shall be taxable after deducting from it the charges as indicated in Rule 22(1)(d)(i) to (vii) where the amount of charges towards labour and service, hire charges or any other like charges in any contract are not ascertainable, in terms of Rule 22(2), such charges shall be calculated at the prescribed percentage as indicated in Rule 22(2) - The various provisions of the JVAT Rules, in particular Rules 22 and 23, stipulate various provisions for deductions to be made including labour and service charges and the Notification SO 208 has to be read along with other provisions of the JVAT Act and Rules and not in isolation. The Notification SO 208 dated 31.3.2006 is not derogatory to the provisions of the JVAT Act and the Rules.
From the bills submitted by the petitioner, it appears that deduction of certain taxes at source have been made. The petitioner had obtained interim order in this writ petition on 21st June, 2013 and thereafter no deduction of VAT at source was made from the bill amount paid to the petitioner. Since the writ petition is dismissed, it is for the Department to take appropriate steps to collect the amount payable by the petitioner either from the pending bills, if any, or otherwise by separate proceedings and in accordance with law - Petition dismissed.
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2014 (7) TMI 1372
Denial of deduction in respect of amount of credit under DEPB Scheme - AO denied the same holding that the assessee has not actually utilized the credit before closing of the relevant previous year for payment of duty on the import of goods - HELD THAT:- As decided in M/s. Excel Industries Ltd [2013 (10) TMI 324 - SUPREME COURT] even if it is assumed that the assessee is entitled to the benefits under the advance licences as well as under the duty entitlement pass book, there was no corresponding liability on the customs authorities to pass on the benefit of duty free imports to the assessee until the goods are actually imported and made available for clearance. The benefits represent, at best, a hypothetical income which may or may not materialize ad its money value is therefore not the income of the assessee - thus we are of the opinion that the assessee is entitled to relief. Accordingly, ground no.1 raised by the assessee is allowed.
Addition u/s 14A - expenditure incurred for earning of the exempt income - HELD THAT:- Assessee mentioned that the said grounds require revisit to the file of the AO considering the fact that the assessee was not given a proper opportunity to clarify the allegations against the bogus purchases on one side and the Assessing Officer failed to record his dissatisfaction with regard to the claim of the assessee that no expenditure was incurred for earning of the exempt income and this is relevant for the issue raised in ground no.3.
Denial of weighted deduction u/s 35(2AB) with regard to the expenditure incurred on scientific research - HELD THAT:- As gone through the cited judgment of CADILA HEALTHCARE LTD [2013 (3) TMI 539 - GUJARAT HIGH COURT] On hearing both the parties and on perusal of the said order of the High Court, we are of the opinion that the issues raised in ground no.4 should be set aside to the file of the AO to examine each of the expenses in detail and apply the cited judgment of the Hon’ble Gujarat High Court (supra) in connection with the claim of expenses relating to the clinical trials. Accordingly, we remand this part of the ground to the file of the AO and ground no.4 is partly allowed statistical purposes.
Deduction u/s 80IB admissible to the eligible units - HELD THAT:- The Tribunal in assessee own case after considering the departmental argument that the AO has correctly invoked the proviso to section 80IA(a) as well as in applying the “global profit percentage method”, while confirming the order of the CIT (A). We find that the facts for this year in question are no different. Therefore, we find no reason to interfere with the order of the CIT (A) for this year. Accordingly, ground raised by the Revenue is dismissed.
Deduction u/s 80IB in respect of receipts in sale of scrap - HELD THAT:- Representatives of both the parties mentioned this issue is required to revisit the file of the AO in view of the fact that the said scrap not only includes generated during manufacturing activity but also other general scrap such as packing material etc. It is a settled issue that the receipts received on sale of scrap during the manufacturing activity is entitled for deduction u/s 80IB and other scrap proceeds are not eligible in view of the principles laid down in the judgment of Liberty India [2009 (8) TMI 63 - SUPREME COURT] AO is required to examine the above issue afresh after affording a reasonable opportunity of being heard to the assessee. Accordingly, ground no.4 is allowed for statistical purposes.
Disallowance of provision of loss on forward contracts - HELD THAT:- The tests laid down by the Hon’ble Supreme Court in the case of Wodward Governor [2009 (4) TMI 4 - SUPREME COURT] are satisfied in the appellant’s case on the basis that the appellant is following mercantile system of accounting, the accounting policy in this behalf has been consistently followed by the appellant and the claim made by the appellant is bona fide.
Therefore, appellant has made correct claim for deductibility of provision for loss by marking to marking the outstanding forward cover contracts and the disallowance by the AO is not justified both on facts and in law. The disallowance is therefore directed to be deleted.
The loss quantified on revaluation of the forward contract is an allowable business loss. This is not the case of the Revenue that the impugned losses are earned on account of premature cancellation of forward contracts.
Appeal of the Revenue is partly allowed.
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2014 (7) TMI 1371
Execution of decrees passed by Courts in reciprocating territory - maintainability of the present lis before the High Court of Delhi - presentation of a petition seeking execution of a decree of a superior Court of any reciprocating territory before a ‘District Court’ - Whether the decree passed by a superior court of a reciprocating territory can be executed by the High Court of Delhi in exercise of its original jurisdiction in terms of Section 44A(1 )of the Code of Civil Procedure, 1908 ? - HELD THAT:- As legislature has consciously in its wisdom chosen not to infuse the conception of ‘competent jurisdiction’ in Section 44A of the Code of Civil Procedure, 1908 in contra-distinction to Section 39 which provides the mechanism for execution of ‘domestic decrees’. The requirements saddled on the executing court under the scheme of Section 39 are alien to the ‘District Court‟; the jurisdiction of which may be invoked by the holder of a foreign decree in terms of Section 44A. Rather it may be pertinently observed that the legislature has vested such ‘District Court’ the power to execute the ‘foreign decree’ as if it had been passed by itself. The conception of ‘competence of jurisdiction’ of executing court contained in Section 39 being wholly absent in the language employed by the legislature in Section 44A of the Code, the same cannot be circuitously injected by this Court as the same would tantamount to legislative re-writing, which is impermissible.
The authoritative observations in M.V. Al. Quamar’s case [2000 (8) TMI 1124 - SUPREME COURT] unequivocally evince that the jurisdiction of the ‘District Court’ in terms of Section 44A of the Code of Civil Procedure, 1908 can be invoked by a holder of a decree of a Superior Court of reciprocating territory, unhindered by the lack of jurisdictional competence of the said Court while dealing with the execution of ‘domestic decrees
For the reasons extensively highlighted by us we are of the considered view that the High Court of Delhi not being a ‘District Court’ in terms of Section 44A of the Code of Civil Procedure, 1908 is not vested with the jurisdiction to entertain the present Execution Petition. In view thereof, the same is liable to be transferred to the ‘Court of District Judge‟ within whose jurisdiction the property sought to be attached is situated for being dealt with in accordance with law.
The appeal is allowed. The impugned order dated November 29, 2013 is set aside in so far it is held that the Delhi High Court would be the ‘District Court’ to execute the foreign decree. Needless to state decision on the objections on merits is also set aside being without jurisdiction. The executing Court shall decide the objections uninfluenced by any observation made by the learned Single Judge on merits. The Execution Applications filed by the appellants are restored save and except the application which challenged the jurisdiction of this Court, which application is allowed.
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2014 (7) TMI 1370
Disallowance u/s 11 - whether objects of the Societies are the general public utility as defined under Section 2(15)? - HELD THAT:- Assessee has been granted registration u/s 12A - The objects of the Societies are the general public utility as defined u/s 2(15) - No action was taken by the A.O. u/s 12-AA(3) before denied the benefit, but directly disallowed the exemption/benefit under Section 11 of the Act. From the order of the CIT (A), it appears that there is no instance of misuse of the funds by the trustees of the Society.
The grant of exemption under Section 11 is not automatic and the assessee shall have to meet out the requirements of Section 11 of the Act. Once, the registration is granted to the assessee under Section 12-A, then the A.O. cannot pass a contrary order without following the provisions of Section 12AA(3), but the same was not done in the instant case. When it is so, then by keeping mind the ratio laid down in the case of CIT Vs. Gujarat Maritime Board, [2007 (12) TMI 7 - SUPREME COURT] as well as C.M.S. Vs. Union of India [2009 (5) TMI 41 - ALLAHABAD HIGH COURT] we find no reason to interfere with the impugned orders passed by both the Appellate Authorities, the same are hereby sustained alongwith the reasons mentioned therein.
No substantial question of law is emerging from the impugned orders.
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2014 (7) TMI 1369
Exemption u/s 11 - AO has declined to extend the benefit of Section 11 of Income Tax Act, though the Society is registered under Section 12A - HELD THAT:- As undisputed fact that the assessee has been granted registration under Section 12A of the Act. The objects of the Societies are the general public utility as defined under Section 2(15) of the Act. No action was taken by the A.O. under Section 12-AA(3) of the Act, before denied the benefit, but directly disallowed the exemption/benefit under Section 11 of the Act. From the order of the CIT (A), it appears that there is no instance of misuse of the funds by the trustees of the Society.
The grant of exemption under Section 11 is not automatic and the assessee shall have to meet out the requirements of Section 11 - Once, the registration is granted to the assessee under Section 12-A, then the A.O. cannot pass a contrary order without following the provisions of Section 12AA(3), but the same was not done in the instant case. When it is so, then by keeping mind the ratio laid down in the case of CIT Vs. Gujarat Maritime Board [2007 (12) TMI 7 - SUPREME COURT] as well as C.M.S. Vs. Union of India, [2009 (5) TMI 41 - ALLAHABAD HIGH COURT] we find no reason to interfere with the impugned orders passed by both the Appellate Authorities, the same are hereby sustained alongwith the reasons mentioned therein.
No substantial question of law is emerging from the impugned orders.
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2014 (7) TMI 1368
Violation of FEMA - Imposition of Penalty - Definition of Person u/s 2(u) - penalty was imposed on the President of the Board of Control for Cricket in India for the violation of the Act - Matter remanded back with direction to Special Director, Directorate of Enforcement first to form his opinion, after recording reasons, whether to proceed against the petitioner with regard to the impugned 11 show cause notices - HELD THAT:- Special leave petition is dismissed.
Any observation made in the impugned order in regard to the merit of the case shall have no bearing at the later stage of the proceedings.
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2014 (7) TMI 1367
Violation of principles of Natural justice - refund claim - matter remitted without passing any conditional order and in any event, if the amount of input tax credit is considered - HELD THAT:- It has to be pointed out, at this stage, that, once it has been found that the orders impugned in the writ petitions are unsustainable on account of violation of principles of natural justice, it is wholly unnecessary to impose any condition while remitting the matter for fresh adjudication and in the considered opinion of this Court, the direction given to the appellant/writ petitioner to deposit 10% of the tax amount as claimed in the demand notice, as a condition precedent to enquire into the matter, is unsustainable and the said portion of the order is liable to be set aside.
The impugned order is set aside insofar as directing the appellant/writ petitioner to deposit 10% of the tax claimed in the demand notice and in other respects, the common order dated 06.06.2014 passed in the writ petitions, stands sustained - Appeal allowed.
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2014 (7) TMI 1366
Deduction u/s 80IB - project undertaken by the assessee was a mixed project of piece-meal sanctions - Whether residual project of development and construction undertaken by assessee complied with the requirements of section 80IB(10)? - assessee pointed out that obtaining of multiple building sanctions, does not result in the project being ineligible for section 80IB(10) benefits - CIT-A allowed the deduction - HELD THAT:- As some of the plots initially comprised in the layout were sold as such would not defeat assessee’s entitlement for deduction u/s 80IB(10) of the Act so long as the conditions stipulated in section 80IB(10) of the Act are satisfied qua the residual project undertaken by the assessee. Factually speaking, it is not in dispute that the profit/loss resulting on account of sale of certain plots as such has not entered assessee’s claim of deduction u/s 80IB(10) of the Act. Therefore, in our view, the CIT(A) made no mistake in rejecting the aforesaid stand of the Assessing Officer and proceeding to examine whether the residual project of development and construction undertaken by assessee complied with the requirements of section 80IB(10).
On obtaining of multiple building sanctions, in our view, the same cannot be held against the assessee. As clarified that the housing project shall be deemed to have been approved on the date of which the building plan of such housing project is first approved by the local authority. Therefore, to say that because assessee had obtained multiple approvals and thus is disentitled for section 80IB(10) benefits, is against the legislative mandate. Hence, existence of multiple building plan approvals cannot be held against the assessee. Furthermore, the requirement that the project is to be on a size of a plot of land of a minimum area of one acre is concerned, the same has also to be examined not with respect to each and every individual building plan approval but with respect to the housing project as a whole. Thus, in the present case, the Assessing Officer erred in considering the size of individual plots of land to examine as to whether it has area of one acre or more. On this aspect also, we find that the CIT(A) made no mistake in disregarding the objection of the Assessing Officer.
Period specified for complying the construction of the project - As evident that with regard to the development of the housing project undertaken by the assessee, last of the completion certificate is dated 31.03.2011. The claim of the Assessing Officer is that a completion certificate has also been issued by the local authority on 02.09.2011, which is the last certificate. Even if the said certificate is taken into consideration, yet it does not breach the outer limit of 31.03.2012 which is stipulated date in the present case for completion of project, as seen earlier. However, the claim of the assessee and which has been upheld by the CIT(A) is that the said completion certificate pertains to construction on a plot, which was undertaken by the purchaser himself. Assessee explained that the said plot was sold as such and the purchaser obtained the building sanction and the assessee had no role to play in the development and construction of the said plot. The aforesaid factual finding is not controverted by the Revenue before us. Accordingly, the stand of the CIT(A) on this aspect is also hereby affirmed.
As a result of the aforesaid discussion, we find that on all the aspects raised by the Assessing Officer, the CIT(A) made no mistake in upholding assessee’s plea for the claim of deduction u/s 80IB(10) of the Act with respect to its housing project, ‘Flora City’ undertaken at Talegaon Dabhade, Pune. Thus, the order of the CIT(A) is hereby affirmed. - Decided in favour of assessee.
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2014 (7) TMI 1365
Non prosecution of appeal by assessee - HELD THAT:- As on the date of hearing i.e. on 15-07-2014 none appeared on behalf of Assessee nor an adjournment application was filed on behalf of the Assessee which indicates that the Assessee is no more interested in prosecuting the appeal, therefore, following the decision in the case of CIT Vs Multiplan India (Pvt.) Ltd., [1991 (5) TMI 120 - ITAT DELHI-D] dismiss the appeal of the assessee. The assessee shall however be at liberty to approach the Tribunal for recalling of this order, if prevented by sufficient cause for non-appearance on the date of hearing. Assessee appeal dismissed.
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2014 (7) TMI 1364
Dishonor of three Cheques - since the Respondent has undergone one year's sentence, he is not willing to pay any amount to the complainant-firm - section 138 of NI Act - HELD THAT:- There are substance in the submission of learned Counsel that the High Court has shown undue leniency to the Respondent. No reasons have been assigned by the High Court for this approach. This Court has on several occasions cautioned the courts that undue leniency should not be shown to the accused facing charges under Section 138 of the NI Act - It is not the case of the Respondent that he has paid any amount to the complainant-firm during the pendency of these cases. He has shown scant regard to this Court's wishes. The amount involved is about ₹ 14,74,753/-. The Respondent should not have been, therefore, given a flea-bite sentence - the High Court should not have shown leniency to the Respondent.
Question of concurrency - HELD THAT:- It is clear from the averments made in the complaints and the judgments of the trial court and lower appellate court that the cheques in question do not relate to one single transaction - the impugned order is set aside.
The impugned order are set aside and the order of the trial court restored in all the three cases - Since the enhanced fine amounts have already been paid, there is no need to pass any order in that connection - Since the Respondent has already been released from jail after having served one year of imprisonment, he shall be taken into custody to serve the remaining sentence - appeal disposed off.
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2014 (7) TMI 1363
Loss from purchase and sale of shares holding the same as speculative loss - Whether CIT(A) has erred in holding that the assessee company’s loss from purchase and sale of share to the tune was not covered by the explanation to provisions of section 73? - HELD THAT:- As it is clear that the deployment of funds is more in the business of money lending from where the interest was earned and further the income as noted above is also from sources other than share transactions. Hence, we find no reasons to interfere in the order of the CIT(A) and same is confirmed.
Disallowance u/s 14A r.w.r. 8D - HELD THAT:- We find that assessee has not spent any amount on interest on borrowing as at 01-04-2008 and borrowing taken this year was not utilized in investment. Assessee has earned big income from derivative transactions at Rs.5,42,61,231/- and suffered loss on investment at Rs.1,22,81,662/- i.e. total expenses claimed are only Rs.1,42,48,311/-. Dividend income being only 1.5% of gross income Rs.2,13,724/- being 1.5% of expenses can be attributed to dividend against which the company has offered Rs.241,126/-. Further, there are direct expenses at 56,023/- as calculated by A.O. will apply in view of the provisions of section 14A r.w,r 8D of the rules. In assessee’s case only Rule 8D(2)(i) is applicable and not 8D(2)(iii). Clause (ii), which clearly provides that formula giving therein is to be evoked only in a case where assessee has incurred expenditure by way of interest during the previous year which is not directly attributable to any particular income or receipt. In this case Interest payment is only Rs.4,801/-. This interest is attributable to loans not utilized for investment but for giving loans to Shakti Sugar Ltd i.e. Rs. 3,00,000/- and Rs7,00,000/- paid as security deposit to SKP Securities. Rs.37,00,000/- taken from Parkview Properties Pvt. Ltd. and Rs. 3 Lacs and Rs. 7 Lacs from Bikanna Cornmercial Pvt. Ltd. and Shahjahanpure Electric Co. Ltd. respectively. In view of the above facts, we have no alternative except to confirm the order of CIT(A) and this issue of Revenue’s appeal is dismissed.
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2014 (7) TMI 1362
Rejection of application to recall the Investigating Officer - Section 311 of the Code of Criminal Procedure, 1973 - HELD THAT:- The aim of every court is to discover truth. Section 311 of the Code is one of many such provisions of the Code which strengthen the arms of a court in its effort to ferret out the truth by procedure sanctioned by law. It is couched in very wide terms. It empowers the court at any stage of any inquiry, trial or other proceedings under the Code to summon any person as a witness or examine any person in attendance, though not summoned as witness or recall and re-examine already examined witness. The second part of the Section uses the word ‘shall’. It says that the court shall summon and examine or recall or re-examine any such person if his evidence appears to it to be essential to the just decision of the case. The words ‘essential to the just decision of the case’ are the key words. The court must form an opinion that for the just decision of the case recall or re- examination of the witness is necessary. Since the power is wide it’s exercise has to be done with circumspection. It is trite that wider the power greater is the responsibility on the courts which exercise it. The exercise of this power cannot be untrammeled and arbitrary but must be only guided by the object of arriving at a just decision of the case. It should not cause prejudice to the accused.
The impugned order merits no interference - It is clarified that oversight of the prosecution is not appreciated by us. But cause of justice must not be allowed to suffer because of the oversight of the prosecution. It is made clear that whether deceased Rupchand Sk’s statement recorded by PW15-SI Dayal Mukherjee is a dying declaration or not, what is its evidentiary value are questions on which we have not expressed any opinion. If any observation of ours directly or indirectly touches upon this aspect, we make it clear that it is not our final opinion. The trial court seized of the case shall deal with it independently.
Appeal dismissed.
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2014 (7) TMI 1361
Transaction of sale of stripes - genuine transaction or not? - addition made by AO under the head of ‘income from other sources’ - ITAT upholding the findings of the CIT(Appeals) that the transaction of sale of stripes by the respondent-assessee as a genuine transaction - HELD THAT:- The laws consistently say that initial burden to establish genuineness of the transaction lies on the assessee first. If the assessee discharges his/its onus, then the burden shifts to the Revenue to produce cogent material disproving the evidence adduced by the assessee. The learned Tribunal has taken note of the judgments on the issue, including an unreported one of High Court of Jharkhand, in Arun Kumar Agarwal (HUF) & Others, [2012 (8) TMI 398 - JHARKHAND HIGH COURT] and also in the case of C.I.T. v. Gobi Textiles Ltd. [2007 (9) TMI 226 - MADRAS HIGH COURT] wherein it has been stated the legal position as quoted by us above.
Here, on fact, the learned Tribunal found the assessee has discharged initial burden lies on it. We, therefore, do not find any element of law to interfere with the impugned judgment and order of the learned Tribunal.
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2014 (7) TMI 1360
Cognizance of the offences - can be termed as final order or not - permissibility of conducting further investigation as provided under Section 173(8) Cr.P.C. - HELD THAT:- A case which came up before the Orissa High Court, which is almost similar to the case on hand, was the one in KAMAL LOCHAN SEN VERSUS STATE OF ORISSA [1982 (10) TMI 221 - ORISSA HIGH COURT]. In the said case, though the report purportedly filed under Section 173(2) Cr.P.C. did not state that it was a preliminary report and investigation had not been completed, from the contents of the report the Court held that the same was not a report contemplated under Section 173(2) Cr.P.C. as the statement contained in the charge sheet itself indicated that the investigation had not been completed.
An attempt has been made on behalf of the contesting respondents to contend that the order taking cognizance of offences based on the incomplete report could be in the nature of interlocutory order against which a revision may not be maintainable and that hence the petitioners should be non-suited for the relief sought for in the revision and they should be relegated to challenge the order under Section 482 Cr.P.C. by filing a separate petition. This Court is not in a position to accept the above said contention raised on behalf of the contesting respondents. Section 482 Cr.P.C. does not restrict the inherent powers of the Court to pass any order in order to render complete justice - As such the impugned order cannot be termed a purely interlocutory order and as rightly contended by the learned senior counsel for the petitioners, it can be construed to be an intermediary order against which the revisional powers of the High Court can be invoked. Even otherwise, the restriction placed on the invocation of the inherent powers is the self-imposed restriction of the Court and in appropriate cases, even though the same will fall under the mischief of Sub-section 2 of Section 397 Cr.P.C., for avoiding miscarriage of justice, the Court can invoke its inherent jurisdiction and grant the necessary relief.
The revision petition shall stand allowed.
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2014 (7) TMI 1359
Sanction of scheme of amalgamation - no secured creditor - HELD THAT:- The certificate issued by the Chartered Accountant as at Annexure-N indicates that there is no secured creditor in respect of the applicant company and the certificate at Annexure P indicates that there is one unsecured creditor and in the same series the consent letter given by the unsecured creditor is also produced.
Where the equity and preference shareholders as also the unsecured creditor have given the consent to the scheme and there is no secured creditor, the issue of convening of the meeting would not arise - the convening of the meeting of the equity and preference shareholders as also the secured and unsecured creditor is dispensed.
Application disposed off.
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2014 (7) TMI 1358
Winding up respondent for non-payment of the debt due to the petitioner - Dishonor of Cheque - HELD THAT:- Having regard to the factum of issuance of cheques by the respondent towards the debt due by it to the petitioner, the Company Petition is closed with liberty to the petitioner to seek its revival in the event either or both the cheques are dishonoured.
Petition closed.
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2014 (7) TMI 1357
Sanction of scheme of amalgamation - convention of meeting of the equity and preference shareholders as also the secured and unsecured creditor - HELD THAT:- Where the equity and preference shareholders as also the unsecured creditor have given the consent to the scheme and there is no secured creditor, the issue of convening of the meeting would not arise.
The prayer made in the application is granted. The convening of the meeting of the equity and preference shareholders as also the secured and unsecured creditor is dispensed.
Application allowed.
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2014 (7) TMI 1356
Scheme of amalgamation - convention of the meeting - HELD THAT:- Where the equity and preference shareholders as also the unsecured creditor have given the consent to the scheme and there is no secured creditor, the issue of convening of the meeting would not arise.
Accordingly, the prayer made in the application is granted. The convening of the meeting of the equity and preference shareholders as also the secured and unsecured creditor is dispensed - Application allowed.
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