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Showing 21 to 40 of 1428 Records
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2015 (7) TMI 1417 - GUJARAT HIGH COURT
Import of used tyres - hazardous waste - confiscation - HELD THAT:- Reliance placed in the case of COMMISSIONER OF CUSTOMS (IMPORTS), CHENNAI VERSUS VS. GOVINDAN [2013 (2) TMI 638 - MADRAS HIGH COURT] where it was held that as per the United Nations Environmental Programme vis-à-vis Basel Convention regarding Pneumatic tyres, the lifetime of an original tyre casing must not exceed seven years.
Having perused the provisions of the Hazardous Wastes (Management, Handling and Transboundary Movement) Rules, 2008 and more particularly definition of clause ‘hazardous waste’ and provisions of Rules, 12, 13, 16 and 23 of the said Rules along with Part B of Schedule III of the said Rules, it is held that the responsible authority / officer of Respondent No.2, Ministry of Environment and Forests, through Joint Director, HSM Division, 2nd Floor, Jal Block, Indira Paryavaran Bhavan, Jor Bagh Road, Aliganj, New Delhi-110003 shall visit the place where the goods in dispute i.e. waste pneumatic tyres are lying. Such Officer should be an expert who possesses the expertise to give the opinion about the quality of the pneumatic tyres.
Such Officer shall give a detailed report with regard waste pneumatic tyres and shall specifically opine whether aforesaid pneumatic tyres are reusuable, retreadable, etc. as provided at entry No.B3140 of Part B of Schedule III to the Hazardous Waste (Management, Handling and Disposal) Rules, 2008.
Petition disposed off.
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2015 (7) TMI 1416 - KERALA HIGH COURT
Registration of First Information Reports and investigation under the Prevention of Corruption Act, 1988 - Constitutional validity of Sections 2(v) and 2(c)(viii) of the Prevention of Corruption Act - HELD THAT:- Law making is a sovereign power and a State function. It denotes "power" vested with the State to regulate men under juridical laws. Wesley N. Hohfeld a renowned author of "Fundamental Legal Conceptions as Applied in Judicial Reasoning" classifies that jural correlative of 'power' is 'liability'. Thus, someone who holds the power can control, reduce and expand the entitlement of the men upon whom the power is imposed. The men bears 'liability' and exposed to exercise of such power. In a Constitutionally governed State, ordinarily, this power to make law, derives from the Constitution - The public duty thus, is a public function or a legal obligation discharged by a public servant under the command of public right. These public rights necessarily, presuppose existence of positive law of the State or valid Governmental directions. The "public right" or "legal obligation" cannot exist in vacuum, the "right" or "legal obligation" must be relatable to law or an authorised function by the Government. Thus, public duty discharged by a public servant is based on the positive law of the State or valid executive directions.
The public duty under the PC Act refers to discharge of duty in relation to State, public or community at larger interest. Thus, a public servant must be under the positive command under the law to discharge such a duty. If a body or Corporation exercises a State function, without obligation under the existing laws, it is only an exercise of State function and cannot be treated as a discharge of public duty.
The public duty in the context of criminal complaint would arise only when the construction of stadium is accomplished. The event complained, is only one step in the construction of stadium. Purchase of land cannot be considered as discharge of a public function. The functional approach in determining public duty; is to determine the action on account of the impact of public element and if it has control over the public at large.
The complaint is not maintainable and the entire proceedings resulting from the impugned orders have to be quashed. Accordingly, the same are quashed and the writ petitions are allowed.
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2015 (7) TMI 1415 - KERALA HIGH COURT
Dishonor of Cheque - insufficient funds - discharge of a liability to the society - whether the complainant/Society has locus standi to file the complaint under Section 138 read with Section 142 or the Nl Act on dishonour of a cheque, which was issued to the Secretary in his name, allegedly in discharge of a liability to the Society?
HELD THAT:- Going by the complaint, obviously, it is seen that the complainant is Devi Vilasam Kettuthengu Sangham and the Sangham is represented by its Secretary Sri. Karunakaran Nair. But going by Ext. P1 cheque, it is seen that the payee is one Karunakaran Nair. The case of the complainant is that, towards the price of coconuts purchased from the complainant/Society, ₹ 16,000/- was due to the complainant/Society and in discharge of the said liability, the said cheque was issued. Therefore, the liability under the cheque was towards Devi Vilasom Kettuthengu Sangham and not towards Karunakaran Nair. But Ext. P1 cheque is seen issued in favour of Karunakaran Nair. It means that though, Karunakaran Nair represents the Society as the Secretary of the Society, the complainant is the Society.
Going by Section 138 of the Nl Act, the statutory language is that where any cheque drawn by a person on the account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or liability, is returned by the bank unpaid due to want of sufficient funds, he shall be deemed to have committed an offence and shall be punished accordingly - According to Section 142 of the Nl Act, notwithstanding anything contained in the Code of Criminal Procedure, 1973, no Court shall take cognizance of any offence punishable under Section 138 of the Nl Act except upon a complaint, in writing, made by the payee or as the case may be, the holder in due course of the cheque. Thus, the payee or the holder in due course alone has the locus standi to file a complaint under Section 142 of the Nl Act.
It is true that Karunakaran Nair could have filed a complaint alleging that in discharge of the liability towards the Society, the cheque was issued in his favour as the Secretary of the Society, since the cheque which was issued in discharge of any other liability also would come under the penal consequences referred to under Section 138 of the Nl Act. But, here there is no such case - The Courts below miserably failed to consider the right or locus standi of the complainant in its correct perspective in view of Sections 138 and 142 of the NI Act.
The conviction and sentence imposed on the revision petitioner on a complaint which was not maintainable is unsustainable under law - the impugned judgment passed by the Trial Court and confirmed by the Appellate Court would stand set aside and the petitioner is acquitted of the offence under Section 138 of the Nl Act - the impugned judgment passed by the Trial Court and confirmed by the Appellate Court would stand set aside and the petitioner is acquitted of the offence under Section 138 of the Nl Act.
This revision petition is allowed.
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2015 (7) TMI 1414 - TELEGANA HIGH COURT
Validity of assessment order - assessment was made alleging that the petitioners had purchased the goods falling under 5th schedule the purchase details from whom the petitioners had purchased had not been set out - HELD THAT:- In the facts of the present case and in the circumstances the assessment order is set aside. However, considering the fact that the assessment orders are set aside, it is deemed appropriate to direct the respondent authorities to furnish the details to the petitioners within a period of four (4) weeks from today and complete the assessment proceedings within a period of three (3) months thereafter. It is needless to mention that the petitioners shall be entitled to raise all the objections both on facts and law.
Petition disposed off.
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2015 (7) TMI 1413 - ITAT CHENNAI
Disallowance of provision made for payment of Gratuity - Since the payment was not made during the year under consideration, AO disallowed the claim of the assessee - CIT(Appeals) found that the approved Gratuity Fund is covered under Section 40A(7)(b) - HELD THAT:- It is not in dispute that the Gratuity Fund is an approved one. The assessee has also made a provision for payment. Since the provision was made for payment of Gratuity fund, which is an approved one, this Tribunal is of the considered opinion that Section 40A(7)(b) of the Act would come into operation. CIT(Appeals) has rightly allowed the claim of the assessee. This Tribunal do not find any infirmity in the order of the lower authority and accordingly, the same is confirmed. - Decided against revenue.
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2015 (7) TMI 1412 - ITAT DELHI
Disallowance on account of Employee Stock Option Plan (ESOP) expenses - HELD THAT:- We find that similar issue came up for consideration before the Special Bench of the Tribunal in Biocon Ltd. [2013 (8) TMI 629 - ITAT BANGALORE]. In this case, the Tribunal has held that discount on issue of ESOP is allowable as deduction in computing income under the head ‘Profits and gains of business or profession.’ Since it is on account of an ascertained and not contingent liability, it cannot be treated as a short capital receipt.
Thereafter, the Special Bench has laid down the mechanism for determining as to when and how much deduction should be allowed. It has been held that the liability to pay the discounted premium is incurred during the vesting period and the amount of such deduction is to be found out as per the terms of ESOP by considering the period and percentage of vesting during such period. Deduction of the discounted premium during the years of vesting should be allowed on straight line basis. Then, dealing with the subsequent adjustment to discount, the Special Bench laid down that any adjustment to income is called for at the time of exercise of option by the amount of difference in the amount of discount calculated with reference to the market price at the time of grant of option and market price at the time of exercise of option.
Thus we set aside the impugned order and send the matter to the file of AO for deciding the issue in conformity with the decision taken by the Special Bench in the aforenoted case. Assessee appeal is allowed for statistical purposes.
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2015 (7) TMI 1411 - ITAT CHENNAI
Expenditure incurred on education of the children of the Directors - Allowable revenue expenditure or not? - HELD THAT:- It is not in dispute that the assessee incurred expenditure on higher education and foreign tours of the grandchildren/children of the Directors. As rightly submitted by the Ld. D.R., it is the responsibility of the parents/ grandparents to give education to their children/grandchildren. No business purpose is going to be served to the assessee by incurring expenditure on the foreign education of the children and grandchildren of the Directors.
Merely because the company was in existence for decades, the law laid down by the jurisdictional High Court in RKKR Steels P. Ltd. [2001 (11) TMI 20 - MADRAS HIGH COURT] and in K. Subramaniam Bros [2000 (12) TMI 67 - MADRAS HIGH COURT] would not change. This Tribunal is of the considered opinion that the law laid down by Madras High Court in RKKR Steels P. Ltd. (supra) and in K. Subramaniam Bros (supra) is squarely applicable to the facts of the case. Therefore, this Tribunal do not find any infirmity in the order of the CIT(Appeals) and accordingly, the same is confirmed.
Disallowance u/s 14A - expenditure relatable to earning of dividend disallowed - HELD THAT:- As rightly submitted by the Ld. D.R., AO on the basis of the statement of account called upon the assessee to show cause why the expenditure relatable to earning of dividend should not be disallowed. This clearly shows that the Assessing Officer is not satisfied with the claim of the assessee on the basis of the books of account. Therefore, it would not be correct to say that the Assessing Officer is not satisfied with the correctness of the account. Rule 8D came into operation by Finance Act, 2009, which is mandatory for computation of disallowance under Section 14A of the Act. Therefore, this Tribunal do not find any reason to interfere with the order of the CIT(Appeals) and accordingly, the same is confirmed.
Assessee appeal dismissed.
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2015 (7) TMI 1409 - SUPREME COURT
Demand of Dowry - suspected case of death caused due to poisoning - allegation of suicide, correct or not - Sections 304B, 498A Indian Penal Code and Under Sections 3 and 4 of the Dowry Prohibition Act - HELD THAT:- In the case at hand, PW-1 was not confronted with his statement recorded by the police Under Section 161 Code of Criminal Procedure to prove the contradiction nor his statement marked for the purpose of contradiction was read out to the investigating officer. When neither PW-1 nor the investigating officer were confronted with the statement and questioned about it, PW-1's statement recorded Under Section 161 Code of Criminal Procedure cannot be looked into for any purpose much less to discredit the testimony of PW-1 and the prosecution version.
PW-1 in his evidence clearly stated that one year before the marriage he had sold his land for Rs. 2,50,000/- and he has stated that he withdrew the money from the banks three-four months prior to marriage. PW-1 further stated that he withdrew Rs. 1,00,000/- from his G.P.F. account one year before the marriage and deposited the money in his Central Bank Account, D.B.S. College Branch and whenever he needed, he used to withdraw money from his account. In his evidence, PW-1 has clearly narrated about the details of money paid to the Appellants i.e. payment of amount of Rs. 11,000/- and Rs. 15,000/- was given on the occasion of 'Tika' ceremony', Rs. 50,000/- each paid on three different dates; fixed deposit amount of Rs. 63,000/- left in the account of Archana which was matured was also withdrawn and paid to the Appellants on 11.07.1997. Evidence of PW-1 regarding making payments to the Appellants is cogent and consistent and is amply strengthened by the bank statements. Non-mention of details of money paid to the Appellants and the demand of dowry and cruelty and harassment meted out to Archana in the statement of PW-1 does not affect the credibility of PW-1. As rightly observed by the High Court, it cannot be expected from a father to narrate everything when he himself was in agony due to death of his own daughter.
So far as the suicide note is concerned, Archana is said to have stated that she is taking the step "suicide" because her mental condition is not good and that nobody should be held responsible for her act. It is pertinent to note that suicide note was not discovered during investigation but it was later produced by the Appellants. When PW-1 (father of Archana) was confronted with the suicide note, PW-1 denied it to be in the hand writing of Archana. Appellants have not taken steps to prove the suicide note to be in the hand writing of Archana. Even assuming the suicide note to be true, the fact remains that the death of Archana was unnatural. The contents of the suicide note does not affect consistent version of PW-1 and PW-2.
Where the prosecution has shown that 'soon before her death' the deceased was subjected to cruelty or harassment by the husband or in-laws in connection with demand for dowry, the presumption Under Section 113B of Evidence Act arises and the Court shall presume that such person who had subjected the woman to cruelty or harassment in connection with any demand for dowry shall be presumed to have caused the dowry death. The presumption that arises in such cases may be rebutted by the accused - Prosecution has established beyond reasonable doubts that 'soon before her death' Archana was subjected to cruelty and harassment by her husband and her in-laws in connection with demand of dowry. The accused were not successful in rebutting the presumption raised Under Section 113B of the Evidence Act. Concurrent findings of the courts below convicting the Appellants Under Section 304B Indian Penal Code is based upon proper appreciation of evidence and convincing reasons. The courts below rightly convicted the Appellants Under Sections 304B and 498A Indian Penal Code and Sections 3 and 4 Dowry Prohibition Act and in exercise of jurisdiction Under Article 136 of the Constitution of India, we find no ground warranting interference with the conviction of the Appellants.
Bearing in mind the facts and circumstances of the case and the occurrence was of the year 1997 and that the accused Rahul Mishra is in custody for more than five years, interest of justice would be met if life imprisonment awarded to him is reduced to imprisonment for a period of ten years. Appellants V.K. Mishra and Neelima Mishra, each of them have undergone imprisonment of more than one year. Appellants No. 1 and 2 are aged about seventy and sixty four years and are said to be suffering from various ailments. Considering their age and ailments and facts and circumstances of the case, life imprisonment imposed on Appellants V.K. Mishra and Neelima Mishra is also reduced to imprisonment of seven years each.
Appeal allowed in part.
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2015 (7) TMI 1408 - ITAT CHENNAI
Disallowance of provision for Gratuity u/s 40(A)(7) - CIT-A by following his own order for the assessment year 2005-06, allowed the claim of the assessee - HELD THAT:- It is not in dispute that the Gratuity fund is an approved one. The assessee also made provision for payment of Gratuity. Therefore, this Tribunal is of the considered opinion that Section 40A(7)(a) may not be applicable to the facts of the case. In fact, Section 40A(7)(b) of the Act would be applicable.
By referring to Section 40A(7)(b) of the Act, this Tribunal, on identical set of facts, allowed the claim of the assessee for assessment years 2005-06 and 2008-09 by confirming an identical order of the CIT(Appeals). Therefore, this Tribunal do not find any infirmity in the order of the CIT(Appeals) and accordingly, the same is confirmed. - Decided against revenue.
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2015 (7) TMI 1407 - ALLAHABAD HIGH COURT
Benefit of input tax credit - credit allowed to dealer without verifying the nature of transaction - Levy of Entry tax - HELD THAT:- The Tribunal has examined the matter at length and has recorded findings of fact that at the time of making the transaction the registration of the assessee was intact. The second finding recorded is that all the transactions were found to be genuine one and had been made against valid documents which were also produced before the authority. All the transactions were made through banking papers and the accounts were found to be genuinue.
Levy of Entry Tax - HELD THAT:- Since the imposition of tax itself has been held to be bad, there is no question of attracting any entry tax in the same.
There are no reason to interfere with the order of the tribunal. No other question was argued - revision dismissed.
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2015 (7) TMI 1406 - CESTAT NEW DELHI
Default in payment of duty as per Rule 8(3A) of the Central Excise Rules, 2002 - bar on utilization of CENVAT Credit Account for payment of duty during the defaulted period - levy of penalty - HELD THAT:- As the appellant have already paid the amount in dispute along with interest, therefore, proceedings under Rule 8(3A) of Central Excise Rules, 2002 are not sustainable - But penalty under Rule 27 of Central Excise Rules, 2002 is imposable on the main appellant. Therefore, the penalties imposed on the appellants are set aside - only the penalty of Rs. 5000 on the main appellant i.e. M/s. Baba Vishwakarma Engineering Co. Pvt. Ltd. is confirmed.
Appeal allowed in part.
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2015 (7) TMI 1405 - ITAT DELHI
Reopening of assessment u/s 147 - Investigation Wing had found out that there were certain persons, who had, on exchange of cash, received accommodation entries in the form of cheques from various persons, who admitted before the investigation Wing that such entries were bogus - HELD THAT:- in the case of assessee, no scrutiny assessment u/s 143(3) had taken place, therefore, whether such credits shown in the balance sheet were in the nature of income or not, could not have been found out, merely on perusal of the return of income - reason to believe of the AO that income had escaped assessment was on cogent grounds in view of the specific details of transaction provided by the Investigation Wing.
Issue of notice u/s 148, which is the statutory procedure for enabling the Ld. AO to verify whether such information was correct or not, was rightly issued by the AO. However, merely because notice u/s 148 was issued does not mean that the information from the Investigation Wing was a gospel truth, and if on verification, the AO finds that no income can be held to have escaped in the hands of the assessee, no addition in respect of such information can be made to the appellant's income. Therefore, Ld. CIT(A) has rightly held that the issue of notice u/s 148 was good in law and the AO has followed the guidelines prescribed by the Hon'ble Supreme Court in the case of GKN Driveshafts (India) Ltd. [2002 (11) TMI 7 - SUPREME COURT] by making note of satisfaction on cogent grounds before issuing the notice u/s 148.
Notice u/s 148 and subsequent notices, issued by the AO could never have been served upon the assessee - As it is evident that the notice u/s 148 and subsequent notices, issued by the AO could never have been served upon the assessee as the same was issued at a wrong address, due to the mistake attributable to the Assessing Officer, in making due diligence of issuing the notice at the correct address given in the return of income itself. The latest address of the assessee was also available with the AO as return of income for assessment year 2010-11 and 11-12 also show the latest address at H.No.500, Gali No. 3, Chander Lok, Mandoli Road, Shahdra.
Best judgment assessment - AO in the remand report has repeated the facts of the case and rather strengthened the arguments of the assessee that notice was issued at the wrong address at 55, Royal Palace, 1st Floor, Vikas Marg, Delhi, which was the address in earlier years much before the assessee had filed the return of income for the current year on 18.10.2004. Under the circumstances, as the notice u/s 148 which is foundation of the reassessment proceeding, was not served upon the assessee, the whole proceedings are held as void-abinitio. Under the circumstances, the action of the AO of making Best Judgment assessment u/s 144, in respect of which evidently no material was gathered by the AO, is not sustainable.
Decided against revenue.
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2015 (7) TMI 1404 - ITAT PATNA
Revision u/s 263 - disallowance u/s. 40(a)(ia) - HELD THAT:- Whether the assessment is made u/s. 143(3) or u/s. 144, where therefore it is shown that a particular aspect of assessment has escaped his attention or consideration, the matter can be required to be examined by him in accordance with the law after allowing the assessee a reasonable opportunity of being heard by the CIT as the revisionary authority in exercise of his revisionary power u/s. 263 of the Act. In the facts of the present case this aspect of the matter, i.e., the exigibility of the impugned sums to tax deduction at source and, consequently, disallowance u/s. 40(a)(ia) on the failure to do so, was not at all considered during the assessment proceedings.
With regard to the disallowance u/s. 40(a)(ia) being not permissible, even where applicable, i.e., where the assessment is framed on estimation basis, we have found the argument as not legally tenable. This is as the assessment of income even under the estimation regime is of the total income under the Act and not of the business profit alone, and which could only be upon considering the applicability or otherwise in the facts of the case of all the relevant provisions of law, to which section 40(a)(ia) is or cannot be any exception. The same in fact is a statutory disallowance, artificially inflating the assessee-payer's income for the time being, which is liable to be allowed as deduction upon complying with the condition prescribed for its non applicability, i.e., of the deposit of TDS to the credit of the payee, in the year in which it stands complied with, introducing thus a timing effect. Not so considering; rather, leads to an anomalous, unacceptable situation. Our reasons in support of our decision stand listed in the foregoing paragraphs of this order.
The premise, or the underlying concern, it needs to be appreciated, is to arrive at the best estimate of the total income after considering all the relevant provisions of law, be it qua an allowance or disallowance in-as-much as the assessment is to be only in accordance with the law. The assessee's argument thus is not valid and, accordingly, we find no infirmity in the direction of the ld. CIT in restoring the assessment for the consideration of the relevant issues to the file of the assessing authority. We decide accordingly.
Addition u/s 68 on unexplained cash credit - The confirmation, if at all, only establishes the identity of the creditor. The ld. CIT has in fact also stated that the confirmations do not bear the particulars of the transactions, i.e., the date and the mode of the payment, and even as much as the PAN of the creditor/s, so that the same cannot be regarded as complete. How, we wonder, could his inference of the A.O.'s acceptance of the cash credit as proven, or of the assessee having discharged the burden of proof u/s. 68, as erroneous and prejudicial to the interest of the Revenue, be contested under such circumstances. This is in view of a clear lack of inquiry and application of mind by the assessing authority while framing the assessment qua this aspect thereof. The assessee has relied on case law, as in the case of CIT v. Jaiswal Motors Finance[1983 (2) TMI 47 - ALLAHABAD HIGH COURT]; India Rice Mills [1995 (12) TMI 55 - ALLAHABAD HIGH COURT], holding that a credit to the account of the partners in a firm could only be added u/s. 68 in their hands. There is nothing to show that the credit is from the partners. The matter, in our view, is factual, with the decisions being rendered with reference to the facts of the case, as by a partner on his introduction as such in a firm, or by the partners on the commencement of the business by the firm, etc. On the legal aspect, how one wonders would s. 68 not apply in-as-much as the 'firm' and 'partner' are different persons under the Act, with the credit/s appearing in the books of the firm? Reference in this context be made to the decision in the case of CIT v. Kishorilal Santoshilal [1995 (2) TMI 14 - RAJASTHAN HIGH COURT], explaining the law in the matter, based on first legal principles - we, accordingly, uphold the impugned order on this ground.
Assessee appeal dismissed.
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2015 (7) TMI 1403 - ITAT DELHI
Rejection of books of accounts u/s 145 - reasonable rate of profit @12% on contract receipt - HELD THAT:- We find considerable cogency in the assessee’s counsel submission that on similar facts the judicial courts have allowed a lower rate upto maximum of 8% on gross receipts which is reasonable in the circumstances of the case. The rate applied should be based on valid basis such as past history of the case, nature of business, past years profits.
As further find that force in the assessee’s counsel version that the assessee Sh. Nand Kishore Pundir is a contractor engaged in supply of machines JCB, Construction of roads & buildings. So he is giving multivaried services. Whereas the case law relied upon by the AO titled as “PARBHAT KUMAR, SIRSA", Parbhat Kumar, Sirsa was civil contractor engaged in civil construction. So nature of work done is not same in both the cases. Therefore, to compare both cases & levy high estimated rate of 12% is not just.
End of justice would be served if profit rate @8% gross receipt is adopted. Accordingly we direct the AO to adopt profit rate @8% on Gross receipts and re-compute the income of the assessee accordingly. Appeal filed by the assessee stands allowed for statistical purposes.
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2015 (7) TMI 1402 - ITAT CHENNAI
TDS u/s 195 - Disallowance made u/s.40(a)(i) - liable for TDS as the services were rendered outside India - HELD THAT:- Section 195 (1) of the Act also prescribes that tax has to be deducted while making payment to non-resident which is chargeable under the provisions of the Act. Therefore, the condition precedent for deduction of tax is the income must be chargeable under the provisions of the Act. In the facts of the present case, the agreement entered into by the assessee with foreign agents revealed that they have been appointed to act as Commission agents outside India in their respective countries. AO has disallowed commission payment u/s 40(a)(i) since there was no TDS made on this payment.
As is evident from the assessment order, excepting this inference by the AO, there is nothing on record to suggest that the income is chargeable to tax in India or the payment has been received by the non-resident agents in India or by any other person on their behalf. There is also no finding by the AO that the non-resident agents have a permanent establishment in India or have any business connection in India, by virtue of which the payment of commission would have accrued or arose in India.
The facts available on record clearly suggest that the non-resident agents did not carry out any business operations in India and has acted as selling agents of the assessee outside India. Therefore, the commission earned by them for services rendered by them outside India cannot be considered as income chargeable to tax in India. AO has not established the fact on record that any one of the non-resident agents is carrying on business through a permanent establishments. Therefore, when the commission paid to the non-residents are not chargeable to tax under the provisions of the Act, no deduction of tax is required to be made u/s 195(1) of the Act.
In the present case, the AO has failed to bring any material on record on the basis of which it could be concluded that commission paid to foreign agents is chargeable to tax in India. Unless the income is chargeable to tax in India, then tax is not required to be deducted u/s 195(1). From the facts and materials available on record, no definite conclusion can be made that the commission paid to foreign agents is chargeable to tax in India.
In the present case, the foreign concern was acting as the selling agent for the assessee and no services rendered by it within the taxable territory, the amount payable as commission was not liable to tax and as the income is arising or accruing to a foreign concern in India, there is no disallowance u/s. 40(a)(i) of the Act on the ground that the tax is not deducted at source u/s. 195 of the Act or remittances made to a foreign concern. In view of this, we find no merit in the ground taken by the Revenue.- Decided against revenue.
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2015 (7) TMI 1401 - ITAT MUMBAI
Rectification u/s 154 - scope of debatable issue - disallowance under section 14A read with Rule 8D computed into the book profits under section 115JB - HELD THAT:- The issue is quite debatable which has yet to be settled by the High Courts/Supreme Court. There are contrary decisions of the Tribunal in favour of both the parties. Under such circumstances, in our view, it was beyond the powers of the AO exercisable under section 154 to make an addition on a debatable issue, the original assessment in this case had been completed under section 143(3) of the Act. Merely because, the other view is possible that itself cannot be a ground to rectify the order under section 154 of the Act as the same cannot be said to be a mistake apparent on record. Similarly, the addition made on account of provision for doubtful debts whether to be added while computing book profits under section 115JB has been a quite debatable issue. Under such circumstances, the invoking of provisions of section 154 by the AO on debatable issue was beyond his jurisdiction.
It is not a case of any mistake apparent on the record. The AO passed the assessment order u/s 143(3) of the Act on the basis of material available before him. It has been time and again held by the higher courts that if the alleged mistakes require investigation into facts or determination of law or discussion of debatable points are involved or two opinions are possible on the issue then such pointed mistakes cannot be said to be mistakes apparent on record which can be rectified under section 154 of the Income Tax Act. Hence, the order passed by the AO under section 154 is not sustainable - Decided in favour of assessee.
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2015 (7) TMI 1400 - DELHI HIGH COURT
Assessment in the name of company amalgamated - Amalgamation of two companies - corporate death of an entity upon amalgamation - Assessment to be made on which entity? - HELD THAT:- In view of the decision of this Court in Commissioner of Income Tax-III v. Dimension Apparels Pvt. Ltd. [2014 (11) TMI 181 - DELHI HIGH COURT] no substantial question of law arises for determination by the Court in this appeal.
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2015 (7) TMI 1399 - ITAT INDORE
Deduction u/s 80IB - Claim denied as two units have exceeded the stipulated constructed area - definition of “Built up Area” in the newly inserted provisions of section 80IB(14)(a) - excess of area of maximum limit of 1500 sq. ft. to qualify for 80-IB(10) deduction and AO was of the view that the provisions of section 80IB are in respect of complete housing project and not individual unitwise, thereofre, 80IB deduction shall be allowed for complete housing project - Scope of newly inserted provision for definition of “Built up Area” in section 80IB(14)(a) - HELD THAT:- We would like to state that the assessee has been granted completion certificate as per the sanctioned plan and no deviations or compounding fee have been reported/levied. Further, we would also like to state that those conditions can be applied to the housing projects which were on the statute book on the date when the housing projects were approved by local authority. In other words, in case the housing projects were approved by the local authority prior to 31.3.2004 then the newly inserted definition of “Built up Area” in section 80(1B)(14a) shall not be applicable to such housing projects.
An assessee cannot be asked to comply with the conditions which were not a part of the statute when the housing project was approved and more so when such conditions are inextricably linked with the approval granted to the housing project by the local authority under its own rules and regulations. If the condition of sub-section (14)(a) of section 80IB is held applicable to the projects approved prior to 1.4.2005 then the assessee has to necessarily seek for a modified plan otherwise the assessee will not be eligible for exemption u/s 80IB(10) and when the assessee obtained valid approval and constructed the building in all respect prior to Ist April, 2005, then also if the provisions are applied retrospectively, the assessee would not be entitled to benefit of tax exemption.
We would like to mention that such beneficial provisions in the Act have been brought into to bring in investment and to encourage infra-structure development of middle income housing projects. If these amended provisions are made effective retrospectively then it will negate the object of the provision. If certain areas are not considered as part of built up area as per Municipal Act then the definition of built up area that is introduced in the Act at later stage shall not be substituted to the project approved prior to that date. It is a settled law that the Court has to harmonize the provision and interpret the same in a manner to achieve the object of legislature than to distress the said object. Therefore, in our considered view, the definition of ‘Built up area’ as inserted by subsection (14)(a) to section 80IB of the Act by the Finance Act (No. 2) 2004, cannot be applied retrospectively and if this definition is not applied, the measurement of constructed unit comes within the limit as provided in the Act. - Decided in favour of assessee.
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2015 (7) TMI 1398 - BOMBAY HIGH COURT
Reopening of assessment u/s 147 - non independent application of mind by AO - HELD THAT:- Objection was first raised, both the Assessing Officer and the Commissioner of Income Tax (Central) took a stand that there is no error in the assessment order and no reassessment proceedings were warranted. Thereafter an officer in the office of the Commissioner of Income Tax (Central) informed the Assessing Officer of the desire of the Commissioner that a notice for reopening be issued. Thereafter when the case was transferred to Mumbai, the Forwarding Memo also indicated that the case be reopened. Prima facie, it appears that the reopening notice was issued without independent application of mind and/or directions of his superior. In view of the above, the reopening notice dated 31 March 2014 is stayed.
After the order disposing of the objections was passed on 27 January 2015 and served upon the petitioner on 10 February 2015, the Assessing Officer proceeded to pass the assessment order under Section 143(3) read with Section 147 of the Act on 11 February 2015. This action of the Assessing Officer is in defiance of and contrary to the directions of this Court in Asian Paints [2007 (1) TMI 159 - BOMBAY HIGH COURT] and Aroni Coomercials Ltd. [2014 (2) TMI 659 - BOMBAY HIGH COURT] wherein it has been held that after the orders disposing of the petitions is passed the Assessing Officer will not commence any proceedings for a period of four weeks from the date of disposing of the objections. In spite of the law being clearly laid down by this Court, the Assessing Officer has proceeded to pass an order immediately after having disposed of the objections.
The issue of action to be taken against the Assessing Officer Mr. P.D. Chougule in passing orders in defiance of the orders of this Court will be considered at the time of final hearing in the light of the explanation being offered by him.
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2015 (7) TMI 1396 - KERALA HIGH COURT
Validity of detention order - initiation of proceedings against the detenu is on the basis that he is a known rowdy - effect on public order, Public health or public safety - tempo of the society was disturbed or not - applicability of ordinary law of land - non application of mind of the detaining authority - higher ups and authorities in the official hierarchy - vital materials have been suppressed by the sponsoring authority before the detaining authority - constitutional requirement flowing from Article 22(5) of the Constitution of India.
Irrespective of the fact whether the acts committed by the detenu will bring him within the scope of the term "rowdy" or "known rowdy", the detaining authority was bound to subjectively satisfy itself as to whether the acts alleged of the detenu do threaten the public order to pass a valid order of detention - As the detaining authority has failed to satisfy itself that the acts of the detenu has affected, public order, Public health or public safety, the issuance of the order under S. 3 of the Act stands vitiated - The various crimes alleged to have been committed by the petitioner are directed against individuals and those crimes, which include a solitary case of murder, cannot be held sufficient to hold that the even tempo of the society was disturbed and consequently the public order - The ordinary law of land was sufficient to deal with the cases in which the detenu was involved and therefore the order of detention curtailing the freedom of the detenu should not have been issued - HELD THAT:- There were ample materials before the detaining authority to conclude, on the basis of materials produced, that the acts committed by the detenu are prejudicial to public order and that that was every likelihood and potentiality of the detenu in committing offences, disregarding the actions taken by the state to curtail him. The satisfaction arrived at by the detaining authority that the reach of the acts of the detenu, its degree, extent and magnitude has caused disturbance to the even tempo of life of the community so as to amount to disturbance of the public order cannot be doubted or faulted. We hold that the challenge raised by the detenu that his acts merely amount to violation of law and order cannot be sustained - the contention that the crimes committed by the detenu has not disturbed the even tempo of the society and thus to disturb the public order has to fail - decided against the detenu.
Non application of mind of the detaining authority is writ large as the detention order was passed when the detenu was in Jail with no prospects of being released in the near future - HELD THAT:- The detaining authority has taken note of the fact that the detenu is an extremely wealthy person with no regard for law or the law enforcement agencies and he is in the habit of committing crimes and could have approached any forum for grant of bail to effectuate his purpose. The detenu is not a person who got involved in a solitary crime. Having regard to the antecedents, previous history, predilections of the detenu to indulge in crimes affecting public order, the nature and conditions of bail order passed and the possibilities of imminent release on bail, it cannot be said that the subjective satisfaction of the detaining authority was not exercised in the proper manner - the challenge raised also has to fail.
Ext. P1 detention order is vitiated as materials on record would reveal that the same was passed on the dictates of the higher ups and authorities in the official hierarchy and thus the detaining authority has abdicated her responsibility in passing the order - HELD THAT:- Reliance placed in Supreme Court in DR. B. SINGH VERSUS UNION OF INDIA & ORS. [2004 (3) TMI 740 - SUPREME COURT] wherein it was held that, information of fact found in a newspaper, Journal or Magazine or any other form of communication cannot be regarded as gospel truth. It was held that newspaper reports per se do not constitute legally acceptable evidence. After going through exhibit P1 detention order, we do not think that the detaining authority has abdicated its responsibility. The contention of the petitioner has to fail on this ground as well.
Necessary and vital materials have been suppressed by the sponsoring authority before the detaining authority, which materials, if supplied would have influenced the mind of the authority to refrain from issuing Exhibit P1 - HELD THAT:- The allegations would reveal that the detenu has assaulted the security staff in the presence of the other security men and there is no case that any person including the deceased had even an occasion to resist the acts of the detenu. It is a one sided assault by the detenu on the security person on his failure to open the gate. The assault on the security staff commenced from the public road and went on inside the apartment complex. It does not appear to us that the said document can be said to be so vital so as to have any relevance in the facts and circumstances of the instant case. Moreover, it is not the law that every document or material in the possession of the sponsoring authority must necessarily be placed by him before the detaining authority and in every case where any such document is not placed by the sponsoring authority before the detaining authority, the formation of opinion and the subjective satisfaction will get vitiated - Only when the said document is likely to affect the formation of opinion and the satisfaction of the detaining authority can it be said that it is a vital document. In the facts of the instant case, it does not appear to us that the wound certificate would have influenced the formation of opinion. The contention raised on this count also has to necessarily fail.
The failure of the detaining authority to inform the detenu that he has a right of representation before the detaining authority, is a constitutional requirement flowing from Article 22(5) of the Constitution of India, and failure to comply with the same will vitiate the order - HELD THAT:- The responsibility or the burden cast upon the detaining authority, under Article 22(5) of the Constitution and S. 7(2) of the KAAPA, while passing orders for detaining "known goondas" or "known rowdies" under S. 3 of the Act, will stand discharged by affording an earliest opportunity to make a representation and communication of the availability of such opportunity/right to represent to the Government and before the Advisory Board against his detention. The detaining authority is not bound, as per the scheme of Act 34 of 2007, to inform the detenu of his right to represent before the detaining authority himself, as there exist no such right - in the instant case, the burden on the detaining authority must be held to be adequately discharged when the detenu is informed of his right to make a representation at the earliest available opportunity. That has been successfully discharged in this case. The contention raised by the petitioner also has to fail.
Petition dismissed.
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