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Showing 221 to 240 of 1287 Records
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2014 (11) TMI 1070
Transfer of right to use - service contract of directional drilling - VAT or service tax - whether the transactions entered into by the petitioners amount to transfer of right to use any goods and, therefore, they are exigible to tax in terms of Section 4(2) of the Tripura Value Added Tax Act, 2004 read with Rule 7 of the Tripura Value Added Tax Rules, 2005? - Held that: - The intention of the parties is clearly to treat the agreement as a service agreement and not a transfer of right to use of goods. We are also clearly of the view that it is impossible from the terms of the contract to divide the contract into two portions and since the petitioners have paid service tax they cannot be also asked to pay value added tax.
We are aware that the dominant nature test is not to be used in composite contracts falling within the ambit of Article 366(29A) but from the reading of the contract it is more than apparent that the intention of the parties was to treat the contract as a contract for hiring of services. Moreover, it is impossible to divide the contract into two separate portions. Every element of the digging directional wells and Mobile Drilling Rig service contains a major element of provisions of services. In such an eventuality it is virtually impossible to divide the contract. It is not possible to work out the value of the right to use goods transferred under the contract. In cases, where the contracts are easily divisible or where the parties have by agreement clearly indicated what is value of the service part and what is value of the transfer of right to use goods part, the contract may be divided. We are in agreement with the Delhi High Court that when the contract cannot be divided with exactitude then the Central Law must prevail.
Parties have also been paying service tax and if the State is allowed to tax any portion of the value of the contract then there has to be a proportionate refund of the service tax to that extent. This cannot be done without hearing the Union of India. If there is any dispute between the State or the Union of India then they must resolve it between themselves. The petitioners or the ONGC cannot be made liable to pay both the taxes for the same transaction.
The transactions do not amount to sale within the meaning of the TVAT Act, 2004 - petition allowed - decided in favor of petitioner.
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2014 (11) TMI 1069
Recovery proceedings - Non-availability of records with the revenue - Respondent / revenue submitted that records are misplaced and could not be retrieved - Held that:- it is quite clear that the premises on which the purported order dated 24th September, 2009 was passed, that is the 16th March, 2006 order, was not in existence when the order dated 24th September, 2009 was passed. Non-availability of records raises a presumption against the Revenue from which an adverse inference can be drawn. Therefore, the show cause notice and all the proceedings culminating in the order dated 24th September, 2009 are set aside. Consequently, the demand and threat contained in the letter dated 15th September, 2014 of the Assistant Commissioner of Customs, Special Tax Recovery Cell [Court], Customs House, Kolkata, are not to be given any effect. In the event, the records of this case are retrieved, this will not prevent the Customs authorities to take such steps, as they may be advised to take.
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2014 (11) TMI 1068
Disallowance u/s 14A - Held that:- After relying on the decision of the jurisdictional High Court in the case of Godrej and Boyce Mfg Co.Ltd (2010 (8) TMI 77 - BOMBAY HIGH COURT ), the ld. CIT(A) have given due justification and restricted the disallowance made u/s 14A with respect to administrative expenses. The ld. CIT(A) observed that the assessee company was to incur administrative expenses to ensure investment which is generating the exempt income, accordingly, he confirmed the disallowance of ₹ 4,25,000/- on account of administrative expenses under rule 8D(2)(iii) of the Rules.
We do not find any infirmity in the order of ld. CIT(A) in confirming the disallowance of administrative expenses which was incurred and attributable to earning of exempt income. - Decided against assessee
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2014 (11) TMI 1067
Penalty u/s 271(1)(c) - CIT(A) deleted the penalty - Held that:- CIT(A) has deleted the penalty on the basis that there was two opinion available as regards the addition made by A.O.
CIT(A) after examining the facts in detail has passed a well reasoned and speaking order with which we do not find any infirmity and therefore appeal filed by the Revenue is dismissed - Decided in favour of assessee
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2014 (11) TMI 1066
Invokation of longer period of limitation - Demand - Short payment of Service tax - Held that:- it needs to be established whether the department can at all invoke the longer period of limitation and secondly, whether the bank has made short payment of tax. If the claim, if any, of the department is barred by limitation, the merits need not be gone into. With those observations, matter is remanded back to Deputy Commissioner. - Decided in favour of appellant by way of remand
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2014 (11) TMI 1065
Addition on account of alleged sale of shares - Held that:- The facts of the present case are similar to the earlier appeal decided by the Tribunal on similar facts in the case of Shri Anantrai B Shah vs. ITO [2012 (12) TMI 966 - ITAT MUMBAI] wherein held neither the statement of Mukesh Chokshi was provided to the assessee nor there was any cross examination of Mukesh Chokshi, whereas contrary to that the assessee has filed all the details required for providing for purchase of shares were genuine. It is not a case of the department, whatever the consideration was paid by the assessee through cheque for purchasing of shares have come back to the assessee under the garb of bogus purchases as there is no evidence against the assessee. Keeping in mind all these facts and circumstances of the case, thus hold that the addition made and sustained on account of purchase of shares only on the basis of statement of Mukesh Chokshi, was not justified - Decided in favour of assessee.
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2014 (11) TMI 1064
TDS u/s 194J - whether the payment in question does not attract section 194J as credit is given to the account of the payee by virtue of oral agreement dated 01.06.2006 without examining the existence such oral agreement and recorded a perverse finding - Held that:- we are of the view that the order passed by the Tribunal is not proper. It violates principles of natural justice. The Tribunal has a jurisdiction to decide the appeals on the ground which are not urged by both the parties. But the parties should be given an opportunity to have their say.
In that view of the matter, we deem it proper to set aside the order impugned herein and remand back the matter to the Tribunal and Tribunal shall consider the appeals on the ground urged by the assessee as well as the additional ground the Tribunal found relevant to decide the appeals after recording the finding on both the grounds the appeal may be disposed of on merits in accordance with law. That would meet ends of justice.
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2014 (11) TMI 1063
Imposition of penalty - Section 57(8)(ii) of VAT - Petitioner engaged in business of purchase and sales of food grains, oil seeds and edible oil etc - Tanker delivering the edible oil detained suspecting evasion of tax - Driver was made to sign the notice and same was treated to have been served upon the transporter - Held that:- the concerned authority has acted in an arbitrary manner and in fact abdicated its authority in the matter of passing of order of penalty without enquiry and without adhering to the procedure as contemplated under Section 57(8) of the VAT. It is shocking to note that order imposing penalty has been passed in a printed format by showing the amount of penalty which at no stretch of imagination can be said to be an order required to be passed under Section 57(8) of the VAT. Such highhandedness and whimsical exercise of power by the concerned authority in the matter of imposing penalty upon transporter without even serving the transporter with notice much less affording an opportunity of hearing in the enquiry required to be held is depracated. There is nothing on record in support of conclusion drawn by the authority concerned that the documents produced were prepared by the same person. Mere self styled observations without anything more on record, it cannot be said that documents produced were false and forged. Therefore, the decision of concerned authority regarding imposition of penalty is wholly arbitrary and unsustainable in the eyes of law. Moreover, mere presumption that both documents are written by same person by itself do not tantamount that documents so produced were false or forged. Such slip showed consequences on the part of concerned authority, speaks volumes about vindictiveness in the matter of exercise of powers entailing penal consequences.
Seeking release of tanker and amount of ₹ 1,68,679/- with interest deposited by the petitioner under coercion - Ownership of consignee - whether the goods dispatched by the petitioner/consignor while in transit, can be said to be the goods of the ownership of the consignee - Held that:- the question whether a contract for the sale of goods does or does not pass the property in the goods from the buyer to the seller must in all cases be determined by the intention of parties to the contract, nature of transactions and terms and conditions of contract. Sale of Goods Act under various chapters and provisions contained thereunder deals with different situations to answer the aforesaid question, and therefore, by figment of thought to ascertain the ownership of goods which is involved in the realm of business transaction shall always be a dangerous phenomenon. Mere dispatch of goods by the seller therefore cannot lead one to form the opinion that the buyer has become owner of the goods as has been done in the instant case. This notion formed by the concerned authority suffers from misconception, lacking common sense and de hors the provisions of Sale of Goods Act. Therefore, the goods in transit in absence of any evidence as regards terms and conditions of sale for dispatch of the goods, cannot be said to be of the ownership of the consignee. Hence, the attachment of the tanker for the aforesaid reason is unsustainable in the eyes of law. Therefore, respondents are directed to release the tanker and also refund the amount of penalty so deposited by the petitioner. - Decided in favour of petitioner
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2014 (11) TMI 1062
Cenvat credit on wrong duty payment - Held that:- It is an admitted position that during the said period, the appellant did not manufacture any DFMO at Jammu as their factory was not operating. The receipt of terpene from TYIL, Taloja, during this period, the statements of various officials of the appellant firm confirming the same, the absence of test reports for the DFMO for this period, all corroborate the fact that no deterpenation was undertaken at JDL, Jammu during this period and therefore, the goods cleared during this period at Jammu was none other than CMO. Therefore, the appellant could not have availed the benefit of Notification No. 56/2002 in respect of such clearances. Consequently, the unit at Taloja also could not have availed any Cenvat credit on such wrong duty payment on Crude Mentha Oil. Therefore, the duty demand against M/s. Jindal Drugs Ltd., Jammu under the provisions of paragraph 2A(g) of Notification No. 56/2002-C.E., dated 14-11-2002 read with Section 11A of the Central Excise Act, 1944 is upheld along with interest liability thereon under Section 11AB of the said Act.
Central Excise duty demands in respect of Terpene and in respect of Menthol Crystals are upheld against M/s. Tien Yuan India (P) Ltd. under Section 11A of the Central Excise Act, 1944 along with interest thereon under Section 11AB and penalty of equivalent on the said firm under Section 11AC of the Central Excise Act, 1944 are upheld.
Confiscation of goods valued at ₹ 95.08 lakhs (approx.) seized on 23-6-2006 at the premises of M/s. Tien Yuan India (P) Ltd., Taloja, under Rule 25 of the Central Excise Rules, 2002 along with option to redeem the same on payment of fine of ₹ 22 lakhs is upheld.
The balance of demands towards duty, interest and penalties (other than those mentioned above) are set aside.
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2014 (11) TMI 1061
Prevention from filing returns electronically - Petitioner applied for Certificate of registration on 19.02.2014, but, Taxpayer Identification Number was issued in the first week of April 2014, i.e. during the subsequent financial year 2014-2015 so the petitioner was not permitted to file returns electronically as required by the Department. Also the password permitting to file returns electronically was issued only on 30.06.2014 and manual returns were not accepted by the Department. Held that:- the challenge to the provisions of Section 19(11) of TNVAT Act was rejected by the Honourable Dvision Bench of this Court and the matter is now pending before the Honourable Apex Court. Further, the petitioner having raised certain factual contentions, which has prevented them from filing returns electronically, the respondent should consider the facts placed by the petitioner under Section 84 of TNVAT Act. - Matter remanded back
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2014 (11) TMI 1060
Invokation of Section 12A of the KST Act - Assessment of escaped turnover - Deemed sssessment - Petitioner contended that Section 12A can be invoked only in respect of the original assessment order or reassessment order and not for deemed assessment - Held that:- in regard to Section 12(7) ibid, the provisions of the KST Act relating to the assessment of escaped turnover shall mutatis mutandis apply to such deemed assessment also. Therefore, proceedings under Section 12A can be initiated even in respect of deemed assessment. - Decided against the petitioner
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2014 (11) TMI 1059
Revision u/s 263 - whether, the revenue could have issued notice under Section 263 of the Act, despite the fact that, against the original order of assessment, the assessee had preferred appeal before the CIT(A), which came to be allowed in part, and against which the appeals preferred by the assessee as well as the revenue were pending decision before the Tribunal - Held that:- The assessee and the revenue both had preferred the appeals raising all the grounds, over and above the ground of deduction under Section 80HHC and 80IA of the Act, the order of the AO stood merged into the order of the CIT(A). In other words, what was at large before the Tribunal was not only the issue with regard to claim of the assessee for deduction under Section 80HHC and 80IA of the Act, but, with regard to additions and disallowances made by the AO, as well. Thus, the principle of merger would apply in this case. Meaning thereby, once the CIT(A) partly allowed the appeal of the assessee in respect of the additions and disallowances made by the AO by way of order dated 23.03.2005, same got merged with the order of the CIT(A).
Therefore, when the appeals filed by the assessee as well as the revenue before the Tribunal were pending, in view of the principle of merger and the decision of this Court in “COMMISSIONER OF INCOME TAX VS. SHASHI THEATER PVT. LTD.” (2000 (9) TMI 33 - GUJARAT High Court ) wherein held that power of revision do not extend to the matters on which the appellate authority had given decision, the assessee could not have been issued the notice under Section 263 of the Act, more particularly, in view of the fact that the matter was at large before the Tribunal in its entirety. Even otherwise, in view of the fact that before issuing the notice under Section 263 of the Act, the assessee was neither heard nor the revenue conducted any inquiry, same deserves to be quashed and set aside. - Decided in favour of assessee
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2014 (11) TMI 1058
TDS u/s 194C - disallowance u/s 40(a)(ia) - non tds on freight charges - Held that:- As the risk and responsibility for carrying out the contract work was solely that of the Assessee. There is no material to suggest that there was any contract or subcontract, whether written or oral with the outside tanker owners and the Assessee. It is in these circumstances and when these out side tanker owners do not have any responsibility or liability towards the Bharat Petroleum Corporation Ltd. or other principals then, in the absence of any privity, the obligation to deduct the tax at source was not that of the Assessee - Decided in favour of assessee
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2014 (11) TMI 1057
Whether the impugned order has gone beyond the scope of both the SCNs or not - Appellant providing services such as asset management and fund management - Held that:- it is not discernible acting on material or basis which is not alleged/brought to the notice of the opposite party cannot be done, as is obvious and well known. No material can be relied upon behind Appellant’s back, as has been done in this case. It is made in violation of the salutary principles of natural justice. Therefore, the Impugned Order by relying on such extraneous material has clearly exceeded and travelled beyond the allegation made in both the SCNs and it cannot be done.
Tenability of demand for the period 2007-08 to March, 2013 - Major portion of the demand relates to Discounting charges and a small portion of which relates to commission earned on sale of Mutual funds and service charges - Held that:- there is not a semblance of consideration, discussion and finding, with material evidence in support, recorded by the Lower Authority in this regard in the Impugned Order, as was essential - yet the liability has been invoked and confirmed against them, in abstentia, as it were thus (non-discussion of material defence submission). Such casual non-consideration made would fail, as is obvious. It is against the salutary principles of natural justice also (‘right to effective representation’). The law in this regard is clear and well settled. It cannot be done. It goes to the root of the issue involve. By applying the decisions in the cases of CCE v. N.M. Nagpal (P.) Ltd. [2006 (5) TMI 49 - SUPREME COURT] and Alpic India v. CCE [2006 (3) TMI 681 - CESTAT, MUMBAI], the impugned order fails entirely, without prejudice and the liability after 30-6-2012 is dropped with respect to commission earned by the appellant as per Notfn. No. 25/2012-S.T., dated 20-6-2012.
Tenability of interest and penalties imposed - Held that:- as there exists no duty liability on appellant in terms of the Impugned Order, its attendant consequences follow as a matter of course. No interest under Section 75 of the FA would be payable by them as ordered therein. Also, no penalties would be imposable on them, similarly. By relying on the decision of Hon'ble Supreme Court in the case of Balakrishna Industries v. CCE [2006 (8) TMI 182 - SUPREME COURT OF INDIA], the interest and penalty imposed is not tenable.
Whether commission received by distributors of mutual fund company are in the nature of commission chargeable to ST under BAS or BOFS or not - Appellant urged that the ST on commission would be liable under BAS and they have not taken this point before the Lower Authority and is taken only during the Personal hearing - Held that:- even though, appellant have not taken up this issue before the Lower Authority, this being question of law, nothing bars them from raising the issue during Personal hearing. The Lower Authority being bound to follow the Board’s Circular No. 96/7/2007-S.T., dated 23-8-2007, has however failed to do so. . There is absolutely no reference made by him to this Circular also. He cannot do so. No reason is also discernible on record for his inaction and failure in this regard. Without prejudice, even if they have not taken this ground as their defence, the Lower Authority in the given circumstances was duty bound to consider the same, as the onus lies on him also in this regard. However, surprisingly and shockingly, the Lower Authority has demanded and confirmed the ST liability of commission earned on sale of Mutual Funds under BOFS and not under BAS, as is evident. The entire liability in the Impugned Order stood under the Commission received by the appellant on sale of Mutual Funds otherwise as per the records, they would have been well under the threshold limit of ₹ 10 lakhs. Accordingly, the whole foundation of the case collapses on this ground, without prejudice.
Eligibility of refund of ST amount and interest paid thereon - Held that:- as the appellant are well within the threshold limit of ₹ 10 lakhs, they would not liable for ST. However, they have paid the ST liability along with respective interest before the issuance of the Impugned Order, therefore, eligible for refund of the same with consequential relief - Decided in favour of appellant
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2014 (11) TMI 1056
Levy of penalty - Section 10(b) read with section 10A of the Act - Whether the assessee a registered dealer made false representation in the declaration in form C issued by him - Held that:- in the application the assessee made it clear that he wanted a certificate in respect of the goods for use in the construction of the bridge. According to him, he thought that "etc." would cover all those articles which may be required for storage of goods used in construction. It is not necessary to decide whether "etc." would actually cover all those articles. It will suffice to say that the assessee could possibly have formed the belief and quite honestly that "etc." would cover those articles. Section 10(b) is a penal provision and where a question arises whether an offence has been committed or not, the dealer who is accused of the offence is entitled to the benefit of the doubt. This is not a case where it can be said that the dealer with the full knowledge of the falsity of the representation made the declaration in the form C issued by him. Therefore, in the light of the language employed in the section and the nature of penalty contemplated, it is difficult to say that all types of omission or commission in the use of form C will be embraced in the expression "false representation". Finding of mens rea is necessary for levy of penalty under section 10(b) read with section 10A of the Act. - Decided in favour of assessee
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2014 (11) TMI 1055
Mis-declaration of goods - classification of the API 5L PSL2x70 and x80 grades - Stainless Steel - Alloy steel’ - ‘Non alloy steel - Production of Advance Authorizations - CESTAT had decided the issue along with various other issues including limited period of extension and willful mis-declaration on the Bills of Entry in favour of appellant reported in [2014 (5) TMI 789 - CESTAT AHMEDABAD]. - Apex Court dismissed the revenue appeal.
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2014 (11) TMI 1054
TDS u/s 194C OR 194J - transaction charges - u/s 40(a)(ia) - short deduction of tds - Held that:- The conditions as laid down u/s 40(a)(ia) for making the disallowance is that, the tax on the amount paid or payable which is deductible at source under chapter XVII B and such a tax, has not been deducted or after deduction has not been paid on or before the due date specified in 139(1). There are only conditions for disallowance u/s 40(a)(ia), firstly, tax which was deductable has not been deducted and secondly, after deduction has not been paid. If both the conditions are satisfied then only disallowance u/s 40(a)(ia) can be made.
The section does not envisages that, if the assessee has deduced the tax under wrong provisions of the act or there is a short deduction of tax then also, it entails disallowance under section 40(a)(ia). There is nothing in the section to treat the assessee as defaulter for claiming a deduction, where there is a short fall in deduction. This proposition has been upheld in the case of CIT Vs. S.K. Tekriwal reported in (2012 (12) TMI 873 - CALCUTTA HIGH COURT). In this case the assessee has deducted tax u/s 194C instead of 194J, the Hon’ble High Court held that the expenses cannot be disallowed u/s 40(a)(ia) merely on account of short deduction of tax at source. Similar view has been taken by the Co-ordinate Benches in the cases relied upon by the learned counsel, which has been referred in the foregoing para. Accordingly, we hold that no disallowance u/s 40(a)(ia) can be made merely because assessee has deducted TDS under section 194C instead of section 194J. - Decided in favour of assessee
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2014 (11) TMI 1053
Revision u/s 263 of the Act - Addition u/s 68 of the Act as business income - Whether in the absence of any satisfactory explanation regarding the source of the creditor, can it be said that the credit is not a business income – Held that:- HC order upheld [2014 (6) TMI 15 - KERALA HIGH COURT] as AO has considered the entire issue and found that the unexplained cash credit is to be treated as income u/s 68 - This is not a case where the decision of the AO can be treated as erroneous.
Setting off of brought forward business loss – Held that:- Since we have already found that the Administrative Commissioner could not have exercised jurisdiction to invoke Section 263 of the Act, the assessment order made pursuant to the said order is rightly rejected by the appellate authorities and the Tribunal. Under these circumstances, this appeal also fails and is liable to be dismissed.
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2014 (11) TMI 1052
Transfer pricing adjustment - amounts received on issue of shares - whether issue of shares at a premium by the Petitioner to its non-resident holding company gave rise to any income from an admitted International Transaction - applicability of provisions of chapter X - Held that:- As in the case of M/s Vodafone India Services Private Limited [2014 (10) TMI 278 - BOMBAY HIGH COURT ] held that the amounts received on issue of shares is a capital account transaction not separately brought within the definition of 'income' as per the provisions of section 2(24) as well as sections 4 & 5 of the Act. Therefore, such capital account transaction not falling within a statutory exception cannot be brought to tax. Even income arising from international Transaction between AE must satisfy the test of income under the Act and must find its home in one of the above heads i.e. charging provisions. There is no charging section in chapter X of the act. Only if there is income which is chargeable to tax under the normal provisions of the act, then alone chapter X of the act could be invoked. Further, since there is no income arising from the transaction of issue of shares, the provisions of chapter X would not apply.
Accordingly, we set aside the orders of TPO dated 30 January 2013, the Draft Assessment order dated 26 March 2014 and of DRP dated 1 December 2013 to the extent they seek to make additions on account of issue of equity shares and debentures to its AE and the shortfall in receipt thereof being considered as deemed loan and deemed interest thereon being sought to be brought to tax. - Decided in favour of assessee
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2014 (11) TMI 1051
Expenditure incurred wholly and exclusively in connection with transfer as contemplated u/s. 48(i) - Whether the payment is actually made as per the agreement? - Payments to the employees - Voluntary payment - Held that:- The assessee established substitution of the conditions mentioned in clause 29 of the share purchase agreement with the manner in which assessee discharged payments to the employees, then the additional evidence with regard to payments could have been examined. Since the assessee has failed to do so, claim of the assessee for having made payments to employees can at best be regarded as a voluntary payment, which cannot be said to be expenditure incurred wholly and exclusively in connection with the transfer of shares.
We may also add that the question whether the expenditure is incurred wholly and exclusively in connection with transfer, which is essentially a question of fact, dependent on facts of each case. The judicial precedents cited by the ld. DR before us, can only serve as a guidance. For example in CIT v. Radio Talkies, (1999 (3) TMI 67 - BOMBAY High Court ), there was a sale of business of exhibiting films and property consisting of land and buildings. The agreement provided that seller had to discharge the liabilities of employees’ gratuity, retrenchment compensation, bonus, etc. Payment was to the former employees and not to the employees who continue after take over of the business by the purchaser. In those circumstances, the Hon’ble Bombay High Court held that expenditure was not allowable u/s. 48(i) of the Act. In the present case, however, we are concerned with a case of change of ownership of business, consequent to sale of shares. The entity, Trident, continues to remain in existence. Therefore, the aforesaid decision cannot be applied to the facts of the present case. We have therefore not discussed the case laws cited by the learned DR before us.
CIT(A) correctly relied on the decision of the Hon’ble High Court of Karnataka in CIT v. R. Ranga Shetty, [1984 (12) TMI 45 - KARNATAKA High Court], wherein it was held that compensation paid to a tenant on transfer by compulsory acquisition of property is not expenditure incurred in connection with transfer and not allowable as a deduction. Following the said decision, he held that expenditure in question claimed by the assessee was a voluntary payment and therefore cannot be allowed as deduction u/s. 48(i) of the Act. - Decided against assessee
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