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Showing 21 to 40 of 1254 Records
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2014 (8) TMI 1237
Penalty proceedings u/s 271(1)(c) - determination of correct head of income - Gain on sale of shares - LTCG OR Business Income - income from capital gain was held to be assessable under the head ‘income from business and profession’ because according to AO the shares were purchased for trading purposes - also assessee has claimed deduction u/s 80G but the assessee had not filed any evidence regarding exemption - HELD THAT:- it was a finding of fact that shares were not held as investment which was confirmed by the Hon'ble High Court. However, at the same tome we find that there is no bar in the Companies Act to convert the stock in trade into investments. Merely because the assessee has treated a particular item of income and the Revenue has changed that treatment would not attract the penal action. See Cement Marketing Co. of India Ltd v Assistant Commissioner of Sales Tax
Wherever the assessee has a bonafide explanation to treat an item in a particular fashion and if that view is not accepted then the same cannot be fastened with penal consequences. See Reliance Petroproducts (P) Ltd [2010 (3) TMI 80 - SUPREME COURT]
Thus the assessee has duly disclosed the facts regarding sale of shares but the only difference is that since shares were treated as investment, therefore, gains were declared under the head ‘capital gain’ whereas same were assessed as income from business and profession by the Assessing Officer. This cannot be called to be a case of concealment of income or furnishing of inaccurate particulars of income. Merely the change in the heads of income would not lead to levy of penalty u/s 271(1)(c)
Rejection of claim on account of donation u/s 80G - As we find force in the submissions of assessee that assessee had itself added back his claim of donation in the computation of income, copy of which is available at page 5 of the paper book. In any case this claim was denied simply because the assessee could not file the certificate of eligibility for exemption u/s 80G and as far as payment is concerned, the same has not been doubted. Therefore penalty is not leviable in this case and accordingly we set aside the order of Ld. CIT(A) and delete the penalty. Assessee appeal allowed.
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2014 (8) TMI 1236
Filling of vacancy in the panel of arbitrators - Former Chief Justice of the Sikkim High Court had been appointed as the arbitrator to resolve the disputes and differences between the parties - HELD THAT:- In the present case Clauses 64(3)(a)(ii) and (iii) of the General Conditions of Contract do not prescribe any specific qualification of the arbitrators that are to be appointed under the agreement except that they should be railway officers. Even if the arbitration agreement was to specifically provide for any particular qualification(s) of an arbitrator the same would not denude the power of the Court acting Under Section 11(6), in an appropriate case to depart therefrom.
A period of nearly two decades has elapsed since the contractor had raised his claims for alleged wrongful termination of the two contracts. The situation is distressing and to say the least disturbing. The power of the Court under the Act has to be exercised to effectuate the remedy provided thereunder and to facilitate the mechanism contemplated therein. In a situation where the procedure and process under the Act has been rendered futile, the power of the Court to depart from the agreed terms of appointment of arbitrators must be acknowledged.
Thus, no infirmity much less any illegality or failure of justice can be said to be occasioned by the order passed by the High Court so as to warrant any interference - appeal dismissed.
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2014 (8) TMI 1235
Capital gain computation - cost of construction of the godown - Assessee after considering the cost of acquisition had worked out the capital gains which was not acceptable to AO - CIT(A) while allowing the appeal of Assessee has noted that the valuation report of the valuer had also estimated the cost of construction of the godown and therefore the Assessee’s share of ½ worked and thus he has considered the cost of acquisition of Rs. 27 lacs considered by Assessee to be in order - HELD THAT:- Before us, Revenue has not brought any material to controvert the finding of ld. CIT(A). Assessee has submitted that the balance ½ share which belonged to his brother and in his assessments, the cost of acquisition of the same godown has been accepted by the Revenue. Before us, no material has been brought on record to show that the valuation of the godown in the case of Assessee’s brother has been challenged in appeal before Tribunal.
We further find that in the case of CIT vs. Kumararani Meenakshi Achi [2006 (10) TMI 123 - MADRAS HIGH COURT] has held that the differential treatment cannot be meted out to another co-owner while making the assessment of same property or while valuing the same property. In view of the aforesaid facts and relying on the aforesaid decision of Hon’ble Madras High Court, we find no reason to interfere with the order of Ld. CIT(A) and thus these grounds of Revenue are dismissed.
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2014 (8) TMI 1234
Deduction u/s 10B - tribunal justification in treating the interest earned from the fixed deposits, interest earned on staff loans and fines collected from the staff and the insurance claim is not in connection with business as provided under Section 10B - HELD THAT:- In the assessee’s case itself, for the assessment year 1998-99, this Court [2010 (4) TMI 1147 - KARNATAKA HIGH COURT] held the said income has to be included in the business income. This Court also had an occasion to consider this question in extenso in the case of the Commissioner of Income Tax vs Motorola India Electronics (P) Ltd. [2014 (1) TMI 1235 - KARNATAKA HIGH COURT] where interpreting Section 10B held what is exempted is not merely the profits and gains from the export of articles but also the income from the business of the undertaking.
The impugned order passed by the tribunal cannot be sustained. Appeal is allowed. The substantial question of law framed is answered in favour of the assessee.
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2014 (8) TMI 1233
Reopening of assessment u/s 147 - Reason to believe - HELD THAT:- As decided in [2014 (1) TMI 1928 - ITAT HYDERABAD] it is the duty of the assessing officer to record valid reasons for reopening of the assessments as otherwise re-opening becomes bad in law since there is no live link/nexus between the reasons recorded and the formation of a belief in order to invoke the provisions concerning escapement of income - facts and circumstances in the group of cases posted now are mutatis mutandis identical since the statement of Shri Raju does not indicate anything about the present companies and no further investigation was made by the assessing officer before issuance of notice u/s 148 of the Act and thus the re-opening of assessments is bad in law. Decided in favour of assessee.
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2014 (8) TMI 1232
Recovery of dues - validity of claim of interest in addition to amount due - Cheque was given as security - non admission of liability - HELD THAT:- There is no material on record to show that there is an agreement between the parties regarding the claim of interest. Moreover, the claim for interest cannot be said to be a liquidated demand.
A perusal of Order 37, Rule 1, sub-rule 2 of the Code makes it clear that the dispute does not fall in any of the sub-clauses of sub-rule 2, in view of the claim of interest made by the petitioner. This alone raises a triable issue. Therefore, in the view of this Court, unconditional leave to defend has rightly been granted by the City Civil Court.
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2014 (8) TMI 1231
Dishonor of Cheque - cheque was issued by the petitioner or not - allegation raised in the complaint filed against the wife of the defacto complainant and the defacto complainant is that 5 cheques were stolen and the occurrence of the offence was stated to be between August 2011 and 27.3.2012 - HELD THAT:- This court is not inclined to accept such contention raised on the side of the petitioner/accused - Here is the case, wherein the private complaint was filed on 30.7.2012 stating that the amount of Rs.7,00,000/- was paid by way of cash to the accused and the cheque bearing No.114866 dated 5.6.2012 drawn on ICICI bank issued by the accused for the same, assuring that the same will be honoured on presentation. When it was presented for collection on 5.6.2012, it was returned dishonoured for the reason of “Account Blocked situation” through return memo dated 7.6.2012 etc. Whereas, the complaint regarding missing of cheques was given only on 19.12.2013. Had it been true, the petitioner would have thought it fit to give complaint during 2011 itself. Though the date of occurrence was between 2011 and March 2012, the complaint was given on 19.12.2013 much after the issuance of statutory notice.
This court is not inclined to accept the theory as put forth before this court, to quash the proceedings - the same is available by way of defence to the accused to be agitated before the trial court and the truthfulness or otherwise of such theory cannot be gone into by this court in this quash petition, which is summary in nature.
This court feels that it is not a fit case to quash the proceedings initiated against the petitioner herein - petition disposed off.
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2014 (8) TMI 1230
Validity of Arbitral Award - no arbitration agreement between the petitioner and the respondent - arbitrator had jurisdiction to decide the dispute between the parties or not - notice of the arbitral proceedings have been served upon the petitioner or not - whether the award deals with the dispute which is beyond the statement of claim - time limitation - HELD THAT:- Admittedly, all the three persons to the transaction are members of IMPAA and the Articles of Association of IMPAA provides for resolution of the disputes inter se it's members, by way of arbitration conducted by "Sub-Committee of Producers Grievances Cell and In-House Settlement". It is nobody's case that the IMPAA makes any distinction amongst it's members. Therefore, even if the dispute between it's members arises out of any capacity other than strictly that of a producer in the transaction between the parties, there can be no escape from the arbitration clause in the Articles of Association.
There is one more reason for rejecting the argument of Mr. Davar of want of Arbitration agreement between the parties. It is the specific case of the respondent that father of the petitioner carried on business of film producing in the name and style of M/s. V.R. Pictures. The petitioner, who is also a producer, on the death of his father, continued the business of the father in the same name i.e. M/s. V.R. Pictures from the same business premises. Therefore, on the death of the father, he stepped into shoes of the father and became liable to repay the loan in the capacity of the principal borrower as well. There is no material on record to challenge this contention of the respondent.
The petitioner next complains that notice of arbitration proceedings was not served upon him - HELD THAT:- Perusal of the impugned award shows that, on receipt of the complaint from the respondent, IMPPA had called for the comments from the petitioner. When he failed to respond, IMPPA assigned the complaint to the Committee for arbitration. The Committee sent notice of the arbitration dated 17th September, 2007 to the petitioner calling upon him to remain present before itself for the arbitration proceedings - The final notice came to be issued on 24th March, 2008 with a specific intimation to the petitioner that on his failure to attend the meeting, an ex-parte decision will be taken in the dispute. Even thereafter, two more notices i.e. notices dated 6th May, 2008 and 26th June, 2008 were given by the Committee to the petitioner before passing the arbitral award. This material from the record is neither disclosed in the petition nor dealt with by the petitioner. In any case, the record shows that the petitioner had appointed Advocate Gajendra Singh to represent him in the arbitral proceedings. That is how the advocate had, received the award on his behalf. Therefore, there is no merit in the contention of non-service of notice of arbitration proceedings.
Next ground of challenge canvassed is that, the award deals with the dispute which is beyond the statement of claim - HELD THAT:- The details of this contention are not stated anywhere in the arbitration petition. The reference to the arbitration had been made by the letter dated 27th July, 2007 sent by the respondent to the Secretary, IMPPA for taking up the case with M/s. V.R. Pictures for refund of the amount of Rs. 57,0,000/- with interest thereon. The letter specifically refers to the extension of time to repay until 18th June, 2006. Therefore, it cannot be said that the reference to the arbitration was of a claim that beyond the statement of claim.
There are no merit in the petition - petition dismissed.
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2014 (8) TMI 1229
Penalty u/s 271(1)(b) - HELD THAT:- Assessee admits that the summon was received personally by the assessee, which was handed over to the Chartered Accountant but the Chartered Accountant could not appear due to his personal illness. This fact was brought to the notice of the income tax authorities.
We are of the view that for the fault of the Chartered Accountant, the assessee cannot be punished as per the ratio laid down in the case of Commissioner of Income Tax Vs. S. Dhanabal [2008 (8) TMI 15 - DELHI HIGH COURT].
We cancel the levy of penalty order. All the impugned orders are hereby set aside. The assessee will get the relief accordingly.
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2014 (8) TMI 1228
Unexplained investment u/s. 69B - addition was made by the AO on the basis of entries made in the diary which had been found in the course of search (of Ashok Kumar Chowta) which was seized - AO based on the entries in the seized diary came to the conclusion that the assessee had paid the aforesaid sums over and above the amount recorded in the registered document and accordingly treated the same as unexplained investment u/s. 69B - HELD THAT:- The assessment is based purely on statement made at the time of Survey as well as on 11.5.2009 before the ADIT (Inv.) Mangalore, which according to us is a conditional statement and cannot form the basis for making an assessment. In our view, the assessee has been consistently taking a stand that the cash payments recorded in the seized diary was for procuring materials on behalf of Chowta and has nothing to do with the contract receipts of the assessee.
Cash payments were only payments made to the assessee for procuring materials for Ashok Kumar Chowta and it has nothing to do with the contracts executed by the assessee for Ashok Kumar Chowta. In fact as we have already seen the assessee had affixed his signature in the seized diary only for the reason that the payments for contract work executed by the assessee would be realized by Ashok Kumar Chowta only if such signature is made by the assessee. This will be clear from answer by the assessee to question 27 in the statement recorded at the time of survey.
Revenue has failed to bring in material on record to corroborate its conclusion that the entries found in the seized diary are unaccounted contract receipts of the assessee and therefore the profit element in executing such receipts has to be brought to tax.
There was no basis for the CIT (A) to have come to a conclusion that 1.5% of the receipts as evidenced in the seized diary should be brought to tax in the hands of the assessee. We, therefore, uphold the order of the CIT (A) deleting the addition of 8% of the receipts as found in the seized diary, however hold that the action of the CIT (A) in bringing to tax 1.5% of the cash receipts recorded in the seized diary was without any basis. There was no statement admitting any other income and the CIT(A) has based his conclusions in sustaining addition at 1.5% of cash receipts recorded in the seized diary based on an non-existent admission of other incomes not declared. Thus the relevant grounds of the assessee in its appeal as well as the cross objections are allowed while the appeals by the revenue on this aspect as raised in its appeals are dismissed.
Addition made of investment in properties for A. Ys. 2007-08 - AO has made the addition based on the entries found in the seized diary - The assessee in the statement recorded on 11.05.2009 in reply to question no.9 has stated that the cash payments to Ashok Kumar Chowta for purchase of residential and commercial premises was adjusted against the contract amounts due to the assessee. There is thus an admission by the assessee with regard to cash payments for purchase of properties in the statement recorded on 11.05.2009. His only stand has been that the cash payments were adjusted against contract amounts due to the assessee. This admission continues to remain without being retracted or explained as incorrect admission. It is thus clear that there were cash payments for acquiring the aforesaid properties over and above what is recorded in the registered documents as well as the books of accounts. The entries in the seized diary only corroborate the fact that there were cash payments in acquiring the aforesaid properties.
The fact that Soumya Shetty was not available to explain the entries, in our view, will not be material. The fact that the assessee made cash payments for acquiring these properties having been admitted it was incumbent upon the assessee to explain the source of funds for making the aforesaid cash payments. In our view, the assessee has not given any valid explanation in this regard. This admission by the assessee remains uncontroverted through out. We are, therefore, of the view that the addition to this extent deserves to be sustained.
Reopening of assessment u/s 147 - In the present case there was a search and recovery of seized diary which was new material based on which the Assessing Officer can entertain reason to believe regarding escapement of income - Similarly with regard to the decision of the Hon'ble Punjab and Haryana High Court in the case of Paramjit Kaur [2007 (8) TMI 323 - PUNJAB AND HARYANA HIGH COURT] the Assessing Officer in the present case after the survey had examined the assessee and on such examination the assessee offered to tax income, but did not file return of income as agreed. In such circumstances, the Assessing Officer entertained the belief regarding escapement of income and therefore it cannot be said that the reopening was not valid.
Similarly, the CBDT Instruction dt 10.03.2003 is only a direction not to take confession and it cannot be said that a reopening cannot be made on the basis of statement made at the time of search or survey. We are therefore unable to agree with the grounds raised by the assessee that reopening of assessment proceedings for A. Ys.2004-05 to 2008-09 was not proper.
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2014 (8) TMI 1227
Rectification of mistake u/s 154 - mistake was occurred in calculation of deduction u/s 80HHC of the Income Tax Act, 1961 while giving appeal effect u/s 251 - HELD THAT:- We find that the Tribunal while dismissing the appeal preferred by the Revenue has held It is a fact that the AO while giving appeal effect to the order of CIT(A) u/s. 251 of the Act dated 30.05.2006 allowed deduction u/s. 80HHC of the Act and that deduction was allowed on the basis of Form No.10CCAC as well as in view of the direction of CIT(A). The AO has taken recourse to the rectification proceedings as he wanted to compute the turnover and computation of turnover is a highly debatable issue as the assessee in original allowance i.e. giving appeal effect to the order of CIT(A) has given his opinion, which he cannot rectify while acting u/s. 154 of the Act. Once this is a position, we are of the view that the CIT(A) has rightly quashed the rectification proceedings carried out by the AO u/s.154
The provision for rectification of mistake under Section 154 of the Income Tax Act, in our view, is “to rectify any mistake apparent from the record”, that is, the mistake should be palpable and as the Tribunal had held that in the instant case it is “a highly debatable issue”, we are of the view that no substantial question of law arises out of the order passed. The revenue was unable to demonstrate that the rectification of computation made arose out of a mistake apparent from the record.
Therefore, the application and the appeal are dismissed.
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2014 (8) TMI 1226
Classification of goods - rate of tax - after water proofing compound and construction material imported by the dealer - Whether liable to tax @ 4% as chemical and not as unclassified item? - section 59 of U.P. Value Added Tax Act - HELD THAT:- It is not in dispute that Excise Code of Acrylic Polymers under the Central Excise Tariff Act, 1985 is 3906000 and the applicant department has also given the very code number to the product falling under Entry No. 162 of Part-C of Schedule IInd to the Act. On this basis, the tribunal has recorded a finding that product has to be accepted as the goods under Entry No. 162. The contention of the assessee was rejected by the Assessing Officer on the ground that this product is only a water proofing / construction chemical. The Tribunal has also recorded a finding of fact that there is no denial of the claim of the appellant that bye products of Acrylic Polymer are included in entry “Polymer in primary form” with main code 3906000.
So far as the other commodity i.e. “CICO Super Plast” is concerned, the case of the assessee is that this commodity is used as water reducing agent and as reaction accelerator for giving extra strength to the concrete after its use and as such this is chemical falling under Entry 29 of Part A of Schedule IInd to the Act. The assessing authority treated this commodity as “Water Proofing Compound and Construction Chemical” - there are no infirmity in the findings of facts recorded by the Tribunal. The applicants have not shown any perversity in the findings of fact recorded by the Tribunal. Under the circumstances the matter is concluded by findings of fact. The tribunal has rightly held that the aforesaid two products are liable to tax @ 4%.
Revision dismissed.
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2014 (8) TMI 1225
Set off the Short term Capital Loss (transactions with STT paid) against the Short term capital gain (transactions without STT paid) - HELD THAT:- We have heard the arguments and have perused the orders of the revenue authorities and the cases cited before us. The impugned issue has been the subject matter of dispute before various coordinate Benches of the ITAT and coordinate Benches have consistently interpreted the provisions of section 111A in favour of the assessee. Respectfully, therefore, following the decisions already in place and with identical facts in hand, we do not find any reason either to distinguish the cases cited before us or to disturb the findings of the CIT(A) on the impugned issue. See FIRST STATE INVESTMENTS (HONGKONG) LTD. VERSUS ASSISTANT DIRECTOR OF INCOME-TAX (INTERNATIONAL TAXATION), MUMBAI [2009 (7) TMI 908 - ITAT MUMBAI] - Decided in favour of assessee.
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2014 (8) TMI 1224
Implementation of Revised Rehabilitation Scheme sanctioned by BIFR - import and implication of concessions envisaged by BIFR at clause 8 of page 7 of the Modified Scheme - Petitioners' case is that the concession envisaged is for the entire period of rehabilitation from 1.7.1995 to 30.6.2002 whereas opposite parties insist that IPISTEEL is entitled to concession there under whenever there was electrical break-down during the rehabilitation period - HELD THAT:- Considering the contentions raised by IPISTEEL to the effect that CESCO has not been properly interpreting the reliefs as contained in clause 8 of page 7 of the Scheme at Annexure-1 and also in para 5(i) and 5(ii) of the order at Annexure-3, the Secretary was directed to issue clarificatory letter. Authenticity of Note Sheet of BIFR is not in question. By the order passed in the Note Sheet, neither the Scheme nor any earlier order has been reviewed or modified. The view expressed in the Note Sheet to the effect that reliefs envisaged at clause 8 of page 7 of the Scheme at Annexure-1 is for the entire period of rehabilitation and not restricted to the periods pertaining to power cut/break-down only has been reiterated and ratified by order dated 17.4.2007 at Annexure-12 reproduced above, by observing that as there was, prima facie, an ambiguity in respect of the reliefs and concessions envisaged from CESCO in clause 8 of page 7 of the Scheme at Annexure-1, the Bench directed, on file, to issue a clarification to CESCO stating inter alia therein that the reliefs as contained in the said para of the Scheme at Annexure-1 would not be restricted only to the break-down period(s) and would be for the entire rehabilitation period. Thus, in course of review hearing, M/s. IPISTEEL Ltd.(IPISL) held on 17.4.2007 at Annexure-12, it has been held that reliefs and concessions envisaged at clause 8 of page 7 of the Scheme at Annexure-1 would not be restricted only to the break-down period(s).
Otherwise also, in order to understand the import and implication of the reliefs and concessions envisaged at clause 8 of page 7 of the Scheme at Annexure-1, a reference may be made to the observations of the BIFR in the Scheme on the basis of which specific reliefs and concessions were granted. While dealing with BACKGROUND at page 2 of the Scheme it has been observed that IPISTEEL failed to make payments as per the OTS mainly in view of non-compliance of various conditions of the BIFR approved scheme by the Government of Orissa, poor profitability arising out of frequent mechanical break-down at the mill and non-availability of need-based working capital funds from the banks - it appears that there is no reference to 'electrical breakdown'. Rather the Scheme refers to frequent 'mechanical breakdowns' as one of the factors which rendered the IPISTEEL sick. In such circumstances, there is no scope to restrict the meaning of words 'break-down/rehabilitation' as used in clause 8 of page 7 of the Scheme to the period of electrical breakdown only.
None of the reliefs and concessions envisaged from CESCO being confined to the period of electrical breakdown only and in the absence of any reference to "electrical breakdown" as pointed out above, there is no scope to restrict the period of reliefs and concessions envisaged under clause 8 of page 7 of the Scheme to the period of electrical breakdown only - Petition allowed.
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2014 (8) TMI 1223
Allowable revenue expenditure OR capital expenditure - expenditure incurred for constructing the “Express Feeder” on behalf of Maharashtra State Electricity Board (‘BSEB’) - said expenditure was incurred to get uninterrupted supply of power necessary for carrying of manufacturing activity. Even, it was treated as capital as per Audit, the assessee has claimed to have entitled for the same as revenue expenditure - HELD THAT:- We find that the Hon’ble Delhi High Court in the case of CIT vs. Dart Manufacturing India (P) Ltd. [2008 (8) TMI 19 - HIGH COURT DELHI] has held that the payment to State electricity board for installing a transformer and LT Lines for supply of electricity – Ownership of the transformer and the LT Lines remained with the electricity board and the fixed capital structure of the assessee remained untouched – Expenditure incurred by the assessee allowable as revenue expenditure as following the decision of CIT vs. Saw Pipes Ltd. [2007 (1) TMI 101 - DELHI HIGH COURT] wherein the expenditure on laying electric service lines for new unit and that may be enduring advantage but intended to enable the assessee to carry on its business more efficiently and profitably leaving the fixed capital untouched. In such situation, the expenditure was allowed as revenue expenditure.
Thus we are of the view that the expenditure incurred for construction of “Express Feeder” on behalf of Maharashtra State Electricity Board was deductible as revenue expenditure. - Decided in favour of assessee.
Disallowance of additional depreciation on Racks, Trolley, D.G. Set, Air Conditioner for Machinery, Cooler, Refrigerator, Camera, Computer Attendance Card System, Wall Mounting fans and Electrical fittings - deduction shall not be allowed in respect of the plant which was previously used within or outside India by any other person, machinery or plant installed in any office premises or any residential accommodation including in the nature of guest house, any office appliance or road transport vehicles or any machinery or plant, the whole of the cost of which is allowed as deduction by way of depreciation or otherwise - HELD THAT:- Applying the tests laid down by the Hon’ble Supreme Court in Scientific Engeering House Pvt. Ltd. [1985 (11) TMI 1 - SUPREME COURT] to the facts in the instant case, it could be said that the fans installed in the administrative office of the assessee constituted plan and machinery for the purpose of granting depreciation u/s.32 of the Act. We also find that in the case of CIT vs. Delhi Air Port Service [2001 (9) TMI 39 - DELHI HIGH COURT] has held that air conditioner fixed in a bus is an integral part of the bus and therefore depreciation on such air conditioner is allowable at the rate applicable to the bus. In the case of CIT vs. Nathubhai H. Patel [2005 (11) TMI 49 - GUJARAT HIGH COURT] the Hon’ble Gujarat High Court has held that air conditioner and fans in the clinic are entitled to additional depreciation. - Decided in favour of assessee.
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2014 (8) TMI 1222
Cruelty - continuing offence or not - whether the allegations made in the F.I.R. constitute a continuing offence? - HELD THAT:- It is found from the F.I.R. that all the incidents alleged by the complainant in respect of the alleged cruelty are said to have occurred at Delhi. The cruel and humiliating words spoken to the 2nd Respondent/wife by her husband, elder brother-in-law and elder sister-in-law for bringing less dowry are said to have been uttered at Delhi. Allegedly, arbitrary demands of lakhs of rupees in dowry have been made in Delhi. The incident of beating and dragging the Respondent No. 2 and abusing her in filthy language also is said to have taken place at Delhi.
The offence of cruelty cannot be said to be a continuing one as contemplated by Sections 178 and 179 of the Code. We do not agree with the High Court that in this case the mental cruelty inflicted upon the Respondent No. 2 "continued unabated" on account of no effort having been made by the Appellants to take her back to her matrimonial home, and the threats given by the Appellants over the telephone. It might be noted incidentally that the High Court does not make reference to any particular piece of evidence regarding the threats said to have been given by the Appellants over the telephone - it cannot be held that the Court at Ambikapur has jurisdiction to try the offence since the appropriate Court at Delhi would have jurisdiction to try the said offence.
The appeal is allowed.
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2014 (8) TMI 1221
Assessment of trust - surplus distributed among the members - whether 95% of surplus of the assessee trust distributed among its members can be brought to tax at maximum marginal rate in the hands of the assessee treating the assessee as AOPs? - HELD THAT:- The co-ordinate Bench of this Tribunal in SARVODAYA MUTUAL BENEFIT TRUST [2013 (11) TMI 1270 - ITAT CHENNAI] and upheld the order of CIT (A) in holding that 95% of surplus distributed among the members is not liable to be taxed.
The share of every beneficiary is quantified. Therefore, we find that the Commissioner of Income-tax(Appeals) is justified in coming to the conclusion that the assessee trusts and the SHGs are inter-related and they are all concerns governed by the principles of mutuality. The 95 per cent surplus distributed by the assessee trusts to the various SHGs working under them is nothing but the income of those SHGs themselves. It is not something that those groups are getting from outside by way of income. It is the fruit of their efforts. After finalising the accounts and computing the surplus, the profits are divided among those members, whose shares are determinate and whose roles are well defined.
We endorse the view of the CIT (Appeals) that all these SHGs working under the assessee trusts are concerns governed by the principles of mutuality and accordingly the 95 per cent of surplus distributed among them are not in the nature of income. The Commissioner of Income-tax(Appeals) has rightly held that 95 per cent of the surplus distributed by the assessee trusts cannot be brought to tax. His orders on this point are confirmed and the grounds raised by the Revenue on this point are rejected.
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2014 (8) TMI 1220
Partition of suit property - Whether the plaintiff No. 1 and defendant Nos. 10 to 17 are entitled for partition of the suit schedule properties as they have been excluded from the possession of the properties by ouster by the sons of deceased Valli namely, Kunhan and Ayyappan for more than 50 years from the date of her death? - whether they have lost their right by adverse possession of the defendant Nos. 1 to 9 by ouster and their claim is barred by limitation? - HELD THAT:- The nature of the property, the nature of title vesting in the rightful owner, the kind of possession which the adverse possessor is exercising, are all relevant factors which enter into consideration for attracting applicability of the doctrine of adverse possession. The right in the property ought to be one which is alienable and is capable of being acquired by the competitor. Adverse possession operates on an alienable right. The right stands alienated by operation of law, for it was capable of being alienated voluntarily and is sought to be recognised by the doctrine of adverse possession as having been alienated involuntarily, by default and inaction on the part of the rightful claimant, who knows actually or constructively of the wrongful acts of the competitor and yet sits idle. Such inaction or default in taking care of one’s own rights over property is also capable of being called a manner of “dealing” with one’s property which results in extinguishing one’s title in property and vesting the same in the wrongdoer in possession of property and thus amounts to “transfer of immovable property” in the wider sense assignable in the context of social welfare legislation enacted with the object of protecting a weaker section.”
The High Court held that the daughters of Valli alone would be entitled to the suit properties but the Trial Court has held on the basis of evidence on record that they were excluded from possession by their brothers for more than 50 years from the date of death of Valli. Hence, their rights, if any, are lost by adverse possession and by ouster and their claim is barred by limitation.
In the absence of averments in the plaint regarding custom followed in the marriage of the daughters of Valli and that their marriage was not in Kudivaippu form therefore, can their rights be excluded upon the suit schedule properties of Valli as per customs prevalent in their community under the Hindu Law? - HELD THAT:- In the absence of evidence on record to show that they were not ousted from possession from the suit schedule properties and that they have been in joint possession of the same with their deceased brothers during their life time and thereafter with their legal representatives as the co- sharers, the finding of fact recorded by the Trial Court on this aspect of the case cannot be disputed with. The defendant Nos. 1 to 9 have stated that the daughters of deceased Valli were married in the Kudivaippu form. However, they have failed to prove the same. However, the Trial Court has recorded its finding on the contentious issue No. 4 in favour of the defendant Nos. 1 to 9 on the basis of undisputed facts and evidence on record, it has rightly held that the above defendants have perfected their title to the suit schedule properties by way of adverse possession by ouster of the plaintiff No. 1 and defendant Nos. 10 to 17 from the said properties, which finding of fact is accepted by us by recording our own reasons in this judgment - the daughters of Valli are excluded from their rights upon the suit schedule properties of Valli and are not entitled for the share as claimed by them in their suit.
Whether the partition deed (Ex.-B1) in the year 1953 is binding between the deceased Kunhan and Ayyappan in view of the litigation between them as per documents (B-2 to B-4) in respect to the suit schedule properties of Valli? - HELD THAT:- This point is also required to be answered in favour of defendant Nos. 1 to 9 - There was litigation between the fathers of the defendant Nos. 1 to 9 in relation to the said partition, no doubt, the father of the defendant Nos. 8 and 9 failed in the aforesaid civil litigation as per the documentary evidence-Exs.-B2 to B4. Therefore, the same is binding on the father of defendant Nos. 8 and 9.
Whether the plaintiff Nos. 2 to 4 are entitled for their share in the suit properties? - HELD THAT:- The defendant Nos. 1 to 9 placing reliance upon the purchase certificates Exs.-B5 and B6 have no relevance to the fact situation. Therefore, the plea urged by them in this regard is wholly untenable in law for the reason that they are neither cultivating tenants nor deemed tenants of the suit schedule properties as there is no evidence produced by them in this regard in the Original Suit. Therefore, the purchase certificates which were obtained by their deceased fathers from the Land Tribunal have no relevance to the facts of the case.
Appeal allowed.
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2014 (8) TMI 1219
Accrual of income - Assessment of accrued interest brought to tax - A.O. calculated interest on the advances given for the year on the number of days for which the temporary advance was given and brought such amounts to tax on accrual basis - A.O. computed interest on these advances at 18% because the company made a claim on M/s. SCSL for repayment of these advances along with damages claimed at 18% p.a. from the date of advance - HELD THAT:- As in assessee’s own group of cases for the A.Y. 2010-2011 unless and until the liability to pay the advances and the rate of interest at which the temporary advances are to be repaid is determined by the Civil Court, it cannot be said that the same has accrued or arisen to the assessees. However, if the assessees had advanced interest bearing funds as interest free advances, the interest paid by the assessees towards such borrowed funds would have to be disallowed and treated as the income of the respective assessees.
The Hon’ble Punjab and Haryana High Court in the case of Abhishek Industries [2006 (8) TMI 123 - PUNJAB AND HARYANA HIGH COURT] has held that the nexus between the interest bearing funds and the interest free advances will have to be proved before making the disallowance of interest and bringing it to tax. We find that neither the Assessing Officer nor the CIT(A) has examined the issue from this angle. Therefore, the orders of the CIT(A) and the Assessing Officers are set aside and the issue is remitted to the file of the Assessing Officer of the respective assessees for de novo consideration in the light of our observations above - if the amounts advanced to M/s. SCSL by the respective assessees are from their own funds, then the interest expenditure cannot be disallowed and brought to tax.
Thus we remit the matter back to the file of the A.O. to decide it denovo. Appeals of the Revenue are allowed for statistical purposes.
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2014 (8) TMI 1218
Dishonor of Cheque - insufficiency of funds - legally enforceable debt or not - HELD THAT:- In order to attract the penal provisions under the N.I. Act "debt or other liability" must be a "legally enforceable debt or liability". If the said instrument is not supported by consideration, there is no question of attracting Section 138 of the N.I. Act.
Section 138 of the N.I. Act treats dishonoured cheque as an offence, if the cheque has been issued in discharge of any debt or other liability. The Explanation leaves no manner of doubt that to attract an offence under Section 138, there should be legally enforceable debt or other liability subsisting on the date of drawal of the cheque - The very fact that the Respondent has taken repossession of the vehicle and has also sold the said vehicle and the sale value of the said vehicle has also been adjusted for meeting the loan repayment, the agreement on the basis of which the postdated cheques were issued cannot be put for clearance for the reason that the Respondent by virtue of the two acts on their part; firstly, of taking possession of the vehicle and, secondly, of sale/auctioning the said vehicle, stood determined. Therefore, the cheques which have been subsequently put for clearance and got dishonoured would not fall within the ambit of legally enforceable debt or other liability.
The Petition under Section 482 of CrPC is allowed and the complaint case initiated by the Respondent against the Petitioner deserves to be and is hereby quashed.
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