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Showing 221 to 240 of 1516 Records
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2016 (1) TMI 1303
Revision u/s 263 - disallowance under section 14A - Held that:- From the perusal of Balance Sheet as on 31.3.2009 placed at Paper Book 74, we see that further investment of ₹ 194.99 lacs was made during the year in equity shares of Jai Suspension System Limited. Further, on perusal of the same Balance Sheet, we see that the total investments are ₹ 721.99 lacs while the owned funds are amounting to ₹ 12,371.46 lacs, which further proves the fact that these investments were also made out of owned funds only. In view of the above, it is true that the assessee has made investments out of owned funds and no borrowed funds were used for such investments. In such a scenario, no disallowance under section 14A of the Act is called for.
AO was fully seized of the matter, he initiated the enquiry, which was fully co-operated by the assessee. AO got satisfied and did not make any disallowance. In such a scenario, the Commissioner of Income Tax cannot impose his opinion on the decision taken by the Assessing Officer. Since it is AO’s satisfaction which matters for making such a disallowance. On the facts and circumstances of the case, the Assessing Officer did not find it appropriate to carry on any elaborate investigation. It is Assessing Officer’s prerogative to decide the extent of enquiry or investigation to be carried out by him. There is no law which directs the Assessing Officer the extent of enquiry to be made in such a case. This is, undoubtedly, not a case of lack of enquiry. Though we do not find it even a case of inadequate enquiry, even in that case, the Commissioner of Income Tax does not get the jurisdiction under section 263 - Decided in favour of assessee..
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2016 (1) TMI 1302
Revision u/s 263 - cancelled the registration granted under section 12AA - Held that:- The meaning of the term ‘order’ is given to be an order of assessment made by the ACIT, DCIT, ITO on the direction of JCIT under section 144 of the Act, or an order made by the JCIT under section 120 of the Act. We observe that there is no reference to an order made by the Commissioner of Income Tax under section 12A of the Act. In view of this, the learned Commissioner of Income Tax has no jurisdiction under section 263 of the Act to cancel the registration earlier granted to the assessee under section 12AA of the Act.
Specific powers have been granted to the Principal Commissioner or the Commissioner in this regard under section 12AA(3) of the Act. The Income Tax Act is a self contained code, whereby specific provisions have been provided for specific conditions under different Chapters and under different sections, sub-sections and clauses, etc. An authority can exercise its power to do any act under the specific provision provided under the Act and not from elsewhere. To cancel the registration, the Commissioner of Income Tax has to assume the power from the provisions of section 12AA(3) of the Act and not from section 263 of the Act, which is basically a power given to the Commissioner of Income Tax to review an erroneous order made by an Assessing Officer, which results in some prejudice to the revenue.
Thus the Commissioner of Income Tax does not have power to cancel registration granted to the assessee earlier under section 12A of the Act, under the revisionery powers given to him in section 263 of the Act. - Decided in favour of assessee.
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2016 (1) TMI 1301
Validity of order of CESTAT - Unjust enrichment - appellant placed reliance in the case of Grasim Industries Vs. CCE [2003 (6) TMI 92 - CESTAT, CHENNAI], which was overruled by the decision in the case of SRF Ltd. Vs. Commissioner of Customs, Chennai [2005 (5) TMI 91 - CESTAT, NEW DELHI], which the appellant did not consider - Held that: - If the Appellant was duly represented before the Tribunal and no explanation has been furnished why the judgment in SRF Ltd. was not cited before the Tribunal, we are not persuaded to interfere at this stage and grant liberty to the Appellant as prayed to file a review application before the Tribunal because if the Appellant be correct, no person can be prejudiced by an act of the Court - appeal dismissed.
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2016 (1) TMI 1300
TPA - comparability - Held that:- Assessee provides software development services to the group and is stated to have been compensated at cost plus 15% mark up on such cost. It also provides software developments services to third parties. Thus companies functionally dissimilar with that of assessee need o be deselected from final list of comparable.
Erroneous adoption of operating margin and arithmetic mean of comparable companies by the learned Transfer Pricing Officer - It was submitted that the TPO did not calculate the PLI of the assessee properly and excluded certain costs from the operating cost. Thereby as against the assessee’s margin at 11.72%, TPO determined the margin at 10.21%. Even though learned counsel relied on various case-law, it was fairly admitted that this issue becomes academic, if Ground No.4 is considered favourably. Consequently, we direct the TPO to keep in mind the objections of the assessee, while working out the PLI of the assessee company in the re-assessment proceedings.
Exclude the TP adjustment on the non-AE transactions - Held that:- The entire cost was taken by the TPO for making adjustment, thereby invoking the TP proceedings on non-AE transactions as well. Therefore, we direct the Assessing Officer/Transfer Pricing Officer to exclude the TP adjustment on the non-AE transactions and re-work out the costs pertaining to the AE transactions and restrict the adjustment if any, only to the AE transactions. With these directions, this ground is considered as allowed.
Non-granting full TDS credit - Dispute Resolution Panel directed the Assessing Officer to examine and give full credit or take suitable action but the Assessing Officer did not give full credit - Held that:- After considering the submissions of the learned counsel and the direction given by the Dispute Resolution Panel, we are of the opinion that the Assessing Officer did not follow the directions of the Dispute Resolution Panel while giving credit, as claimed by the assessee at ₹ 55,70,991. We therefore, reiterate the direction given by the Dispute Resolution Panel to examine the issue and give credit of TDS to the assessee.
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2016 (1) TMI 1299
TPA - comparability of the assessee with HFCL - Held that:- On a careful reading of the impugned order, we find that in the absence of any infirmity in the reasoning adopted by the First Appellate Authority, the arguments of the Ld. Sr.DR cannot be accepted. The Revenue has not assailed the finding of the CIT(A) that functional comparability of the assessee with HFCL stands established. Thus where on FAR analysis the conclusion that it is correctly chosen as a comparable remains is unassailed, then it is necessary for the Revenue at that stage to bring some cogent reason, argument or fact justifying that still the comparable needs to be excluded. Merely re-iterating the TPO’s stand at this stage that it was consistently a loss making company does not hold good in the face of the finding of the CIT(A). The data placed on record by the assessee assails the conclusion and this fact has been accepted by the CIT(A). We further find that it remains unrebutted on record. In the afore-mentioned peculiar factual position, we find that there is no merit in the departmental appeal.
Disallowance of excess depreciation on UPS - Held that:- A perusal of the order shows that relying upon the decision of the Delhi High Court in the case of CIT vs BSES Rajdhani Power Ltd. [2010 (8) TMI 58 - DELHI HIGH COURT ] depreciation @ 60% for UPS, printers and scanners on the ground that they formed integral part of the computer system is allowed and held to be applicable to block of computer. The position of law is well-settled, thus in the absence of any arguments to the contrary by the Revenue, Ground of the Revenue is dismissed.
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2016 (1) TMI 1298
Supply of copy of ECIR along with all the documents and annexures which had not been given to the petitioner - Held that:- Additional Solicitor General, Government of India, has handed over a photocopy of the ECIR to Mr.Kapil Sibal, learned senior counsel appearing for the petitioner. But the copy of ECIR supplied does not contain any annexures or attending documents.
The photocopy of the documents which have been seized from the residence and other premises of the petitioner shall be furnished to either the petitioner or his authorised representative, who shall approach the office of the CBI on 08.01.2016 at 10:30 a.m.
Since the respondents have taken a decision of handing over a copy of the ECIR and photocopy of the documents seized from the premises of the petitioner, no lis remains to be decided.The grievance of the petitioner stands completely redressed so far as the prayer in this petition is concerned.
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2016 (1) TMI 1297
CENVAT credit - cement - structural items - Held that: - various items are fabricated at site and later on, erected and bolted to the concrete footing with the help of nuts and foundation bolts - The Hon’ble Supreme Court in the case of CCE Vs. Rajasthan Spinning Mills [2010 (7) TMI 12 - SUPREME COURT OF INDIA], while allowing the credit on M.S. items like angles, sheets, etc. evolved user test to determine whether these items can be considered as components or accessories of capital goods on applying this principle - there is no error in the findings by the ld. Commissioner (Appeals) in as far as eligibility of credit on steel structural items.
CENVAT credit - cement - Held that: - the cement used for constructing under-ground storage tank, which is a civil structure, will not be eligible for CENVAT credit.
Appeal allowed - decided partly in favor of assessee.
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2016 (1) TMI 1296
Valuation - whether the assessee being a manufacturer of flashlight torches, is chargeable to duty under Section 4A in respect of institutional/industrial sales made by them instead of Section 4 as claimed by the assessee? - Held that: - the issue is no more res-integra and the same have been decided in favour of the assessee by this Tribunal following the ruling of the Supreme Court in the case of Jayant Food Processing (P) Ltd. Vs. CCE., Rajasthan [2007 (8) TMI 3 - Supreme Court ], where it was held that As SWM Act and Rules do not require fixing MRP on such dry cell batteries, the question of assessing the said goods in terms of provisions of Section 4A is ruled out - the sale/clearance made to institutional buyers shall be taxable under Section 4 and not under Section 4A of the Act - appeal allowed - decided in favor of appellant.
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2016 (1) TMI 1295
Disallowance of expenditure under section 14A read with rule 8D - Held that:- We find that the issue is squarely covered in favour of the assessee in the own case of the assessee for the earlier assessment year. The strategic investments in group companies and sister concerns for having control over the management of the said companies are not intended for the purpose of earning of exempt income. Under such circumstances for computing the average value of investment for the purpose of disallowance under rule 8D(2)(iii), the investments made in unquoted shares of the subsidiaries sister concerns/group companies for strategic purposes are required to be excluded. We, therefore, direct the AO to verify as if the assessee has net positive interest income during the year, then no disallowance of interest is to be made under section 8D(2)(ii) and further direct the AO to exclude the strategic investments made in subsidiaries while computing disallowance of administrative expenses under rule 8D(2)(iii) of the IT rules.
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2016 (1) TMI 1294
Levy of service tax - commission earned by the appellant acting as foreman conducting the chit funds - Held that: - writ Petitions stand disposed of reserving liberty to the petitioner to file necessary application for modification of the impugned orders vide Annexures “A” and “B” within a period of one week from the date of receipt of the copy of this order - petition disposed off.
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2016 (1) TMI 1293
Penalty u/s 272A(2)(K) - return of income were filed late - Held that:- Considering assessee submission that the employee of the assessee looking after TDS could not do the work because of ill health and mental stress and this came to the knowledge of the Director very late. The Director was busy in the expansion of the business and installation of a new plant at Palsana and therefore, there was no willful intention not to comply with the provision. AS citing of the PAN was mandatory vide circular dated 12/2/2008 and therefore, the GDS return were not accepted by the computer but The PAN was received very late . The facts were not denied by the ld DR, in my opinion, the default was mere a technical breach. It is a case of assessee that he has duly deducted the tax and paid the tax. The provision of Section 273B of the Act mandates that if the assessee was prevented by the reasonable cause, therefore, no penalty should be levied. - Decided in favour of assessee.
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2016 (1) TMI 1292
Condonation of delay - delay not explained properly - Revenue’s appeal has been dismissed for want of steps being taken to comply with the procedural rules - Held that: - The lapse on the part of the official to follow up the matter with the advocate or otherwise with the Registry will not enable us to condone the delay on which we do not have any contents on file - we cannot accept the explanation as it is neither sufficient nor reasonable - delay not condoned - motion dismissed.
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2016 (1) TMI 1291
Assessment u/s 153A - Held that:- In the absence of any incriminating material found during search, additions made on the assessed income are unsustainable in law, we are of the considered opinion that the additions made in the instant case are not sustainable and accordingly, we delete the same. Accordingly, the grounds originally raised by the assessee are allowed.
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2016 (1) TMI 1290
Addition u/s 68 - Held that:- Assessee has produced all necessary and possible evidence to prove the identity, creditworthiness, and genuineness of the transaction. The A.O. has simply rejected these evidences. There is no independent investigation by the A.O. There is no material with the A.O. to disprove the claim of the assessee. The Ld. CIT(A) has failed in his duty to properly appreciate the evidences.
The assessee has also produced evidence in the form of repayment of the above loan to Mr. Balvinder Singh to further substantiate his claim. The payments have been done through banking channels. In view of the above evidences, the addition in question has to be deleted. We therefore delete the addition and allow the appeal filed by the assessee.
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2016 (1) TMI 1289
Deduction u/s.80IA - whether each of the windmill was a separate undertaking? - Held that:- As in assessee’s own case for the A.Y. 2006-07 [2015 (10) TMI 2649 - ITAT CHENNAI] observed that each windmill is to be considered independent and separate and as a consequence deduction u/s.80IA to be computed and decided the issue in favour of the assessee. Accordingly, the CIT(Appeals) is justified in allowing the claim of deduction u/s.80IA of the Act to the assesse and this ground of the appeal of the Revenue is dismissed.
Depreciation claim @ 60% on UPS accepted. See [2014 (11) TMI 1121 - ITAT CHENNAI].
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2016 (1) TMI 1288
Penalty u/s 272A(2)(k) - delay caused in filing TDS statement - as per assessee delay is due to acute shortage of funds coupled with inadequate staff and facilities - Held that:- Sec.273B of the Act lays down that the penalty shall not be imposed in respect of a default relating to the provisions mentioned therein if the person or the assessee concerned can show that there was a reasonable cause for default in question. Section 272A(2)(k) falls within the ambit of sec.273B of the Act. It is observed that the AO has levied the penalty in a routine manner without bringing the facts on record to establish that the appellant committed the default without a reasonable cause. - Decided in favour of assessee.
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2016 (1) TMI 1287
Revision u/s 263 - receipt of development fund - claim of exemption u/s 11 - Held that:- The issue of receipt of development fund was duly examined by the Assessing Officer in the AYs 2007-08 and 2009-10 while completing the assessment u/s 143(3) of the Act. Moreover, the CIT(Exemption) has observed in a show cause notice that the development fund was not routed through income and expenditure account and was directly taken to the balance sheet. The observations of the CIT(Exemption) is not correct as the assessee has taken this amount as income in the income and expenditure account and thereafter it was credited to the balance sheet and having applied its income to the chargeable purpose, the assessee has claimed exemption u/s 11 of the Act.
For invoking the provision of Section 263 of the Act, the assessment is required to be held as erroneous and prejudicial to the interest of the Revenue. If the assessment order is only erroneous and not prejudicial to the interest of the Revenue the provision of Section 263 of the Act cannot be invoked.
Since the assessee has taken the development fund to the income and expenditure account after treating it to be income, the assessment order cannot be called to be prejudicial to the interest of the Revenue, though it may be erroneous for certain reasons. Assessment order is neither erroneous nor prejudicial to the interest of the Revenue, the provisions of Section 263 cannot be invoked. - Decided in favour of assessee.
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2016 (1) TMI 1286
Exemption u/s. 10A - Held that:- Issue stands decided in favour of the assessee by the order of the Hon’ble High Court in assessee's own case for previous AY [2012 (9) TMI 1097 - BOMBAY HIGH COURT] as relying on case of CIT vs. Gem Plus Jewellery India ltd. [2010 (6) TMI 65 - BOMBAY HIGH COURT] thus held the communication charges, professional fees and expenses incurred in foreign exchange for travelling should be reduced from the total turnover as well as from export turnover for applying the provisions of Section 10A
Non granting credit of taxes deducing at source and charging of interest u/s. 234B and 234C - AR stated that the assessee filed rectification application in that regard - Held that:- We find that the assessee had filed application u/s.154 of the Act before the AO on 27.2.2013 and it has not been disposed by him till date. We direct that the rectification application filed by the assessee should be disposed within six weeks of receipt of our order. Grounds allowed for statistical purposes.
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2016 (1) TMI 1285
CENVAT credit - S angles, channels, beams, HR plates, coils, steel tubes etc - denial on the ground that these were used for supporting structure, platforms for the equipments and interconnecting pipelines to the equipment like evaporators, sugar melting system etc. - Held that: - In the case of India Cements Ltd.[2015 (3) TMI 661 - MADRAS HIGH COURT], it has been categorically held that credit is admissible on MS items used for supporting structures - credit allowed - decided in favor of assessee.
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2016 (1) TMI 1284
Initiation of proceedings u/s 153C - absence of satisfaction note - Held that:- Undisputedly and admittedly, the present case is related to A.Y 2010-11 and from the satisfaction note, Annexure D, it is amply clear that the financial transactions recorded in page 36 to 56 and page 13 are tax audit reports, financial statements and trial balances pertaining to A.Y 2011-12. This facts also gets support from the written submission of the ld. DR dated 21.10.2015. Hence we are inclined to hold that there was no document relevant to A.Y 2010-11 before the AO of the searched person i.e. present assessee neither at the time of recording satisfaction u/s 153C of the Act on 29.11.2013 nor at the time f passing the impugned reasoned order u/s 143(3) r.w.s 153C of the Act.
The ld. CIT-DR could not assist us as to whether any satisfaction note was recorded before handing over the impugned documents to the AO of the searched person i.e. the present assessee. Thus, in the absence of any document or any other contention on record before us, it is safely presumed that the AO of the searched person i.e. Minda Group did not record any satisfaction before handing over the impugned documents to the AO of the present assessee. Therefore, in our considered opinion, in the absence of such satisfaction note by the AO of the searched person, the AO of the searched person miserably failed to confer any lawful and valid jurisdiction on the AO of the present assessee to proceed with the initiation of proceedings and issuance of notice u/s 153C of the Act. Hence, we set aside the initiation of proceedings and issuance of notice u/s 153C of the Act and also hold that the impugned assessment order passed in pursuance thereto is void ab initio.
Since we have held that the impugned assessment proceedings and assessment order u/s 153C of the Act as void ab initio, the other grounds of the assessee appellant on merits are of no consequence in view of lack of jurisdiction of the AO to proceed with the assessments u/s 153C of the Act. In view of our decision on the legal issue, as noted above, there is no need to espouse the other grounds taken by the assessee agitating other legal issues on merits and the same are dismissed as having become infructuous in all the four appeals. - Decided in favour of assessee.
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