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Showing 221 to 240 of 2121 Records
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2019 (2) TMI 1909
Addition u/s 40(a)(ia) - clearing and forwarding expenses in connection with imports - no TDS was deducted on reimbursement of the expenses - AO took the view that assessee could not pick and choose the nature of expenses on which TDS was required to be deducted - HELD THAT:- Before us the ld AR for the assessee has made two fold submissions that (i) the expenses was paid on account of reimbursement, therefore, no TDS was require to be made and (ii) that the receipt has included the said payment in its return and has paid the tax on such income. Therefore, Considering the second contention of the assessee in view of the decision of Tribunal in Ranjana Roy versus ITO . [2015 (12) TMI 1846 - ITAT KOLKATA], in ITO Vs Opera Global Pvt Ltd. [2012 (6) TMI 704 - ITAT, NEW DELHI] and in Bridgegopal Madhusudhan Bhattad [2015 (6) TMI 1045 - ITAT NAGPUR]that when the recipient has paid tax on the income no disallowance can be made in the hand of payer. Hence, this issue is restored to the file of assessing officer to verify the facts if the recipient has included that payment in its income and paid the tax and pass the order in accordance with law. Needless to order that before passing the order the assessing officer shall grant opportunity of hearing to the assessee and to furnish necessary evidences. In the result this ground of appeal is allowed for statistical purpose.
Disallowance of interest expenses - assessee submits that assessee debited interest and financial charges towards the interest paid to Bank and on unsecured loans - HELD THAT:- Assessee has shown his own funds of ₹ 5.68 crore, this fact has been duly recorded and accepted by learned Commissioner (Appeals) - The assessee has made a booking of office premises with Lotus Grhinirman Private Ltd. We have noted that the fund advanced by assessee is of ₹ 45 lacks on account of booking of office premises. The assessee has sufficient interest free funds in the form of reserve and surplus and share capital of ₹ 5.68 Crore. Therefore, keeping in view, the ratio of the decision of Hon’ble Bombay High Court in CIT Vs Reliance Utility and Powers Ltd [2009 (1) TMI 4 - BOMBAY HIGH COURT], no interest disallowance is warranted, when the interest free funds available with the assessee is far more than the investment made by the assessee. Therefore respectfully following the decision of Hon’ble Bombay High Court, we direct the assessing officer to delete the disallowance - In the result, ground no.2 is allowed.
Disallowance sundry balance written off - AO disallowed the entire claim holding that the assessee has not furnished detailed for justifying the decision of write off, the Assessing Officer also noted that certain write off were pertaining to Cenvat Duty, Education Cess etc. - HELD THAT:- As decided in M/S. NCS DISTILLERIES P. LTD., HYDERABAD [2014 (9) TMI 1160 - ITAT HYDERABAD] write off of Cenvat credit by the assessee in its books of account is thus allowable as business expenditure under the provisions of section 37(1) of the Act relatable to the year, in which the manufacturing activities are closed down by the assessee. The claim of the assessee is that they have closed down the business pertaining to the aluminum business and the excess credit of Cenvat was not utilized pertaining to that business. Therefore, we direct the Assessing Officer to verify the fact about the availability of Cenvat Credit to the assessee at the end of relevant Financial Year and allow write off of Cenvat credit.
Sundry balance written off - Assessee has given advances for purchasing various materials like steam coal, LAM Coke and other store consumable - The Hon’ble Apex Court in T.R.F. Ltd. vs. CIT [2010 (2) TMI 211 - SUPREME COURT]held after 1st April 1989, it is not necessary for the assessee to establish that the debt, in fact, has become irrecoverable. It is enough if the bad debt is written off as irrecoverable in the accounts of the assessee. Considering the law laid down by Hon’ble Apex Court, the sundry balances which has been written off by the assessee in its books of account is sufficient to claim the bad debt. In the result, this part of ground of appeal is allowed in favour of assessee.
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2019 (2) TMI 1908
Classification of imported goods - airsprings - whether classifiable under HSN Heading 8607 (i.e. parts of coach work of railway running stock) and thus covered under Entry No. 241 of Schedule-I of the GST rate notifications or otherwise? - applicable rate of tax under GST.
Whether airsprings imported by the applicant are classifiable under HSN Heading 8607? - HELD THAT:- As per specification provided “In air suspension system, properties of air are used for cushioning effect. Enclosed pressurized air in a rubber below is called airsprings.” Therefore, as per the submission, technical specifications and characteristics mentioned by the party in respect of airspring it appears that the goods in question are air below made of rubber to be used in spring - The jurisdictional AC, CGST Div-II, Noida also submitted that the party’s assumption is not acceptable as the disputed goods are made of rubber and the articles of vulcanized rubber are excluded from Chapter 86 as per Section Note 2(a) to Section XVII. After considering the submissions made by the applicant and jurisdictional office it is observed that it is not appropriate to classify the goods in question under the Heading 8607.
Applicable rate of GST - HELD THAT:- As the answer to the first question is in negative, second question cannot be considered.
Scope of Advance Ruling application - HELD THAT:- The question is out of the purview of the mandate of the Advance Ruling u/s. 95(a) which provides that :- “advance ruling” means a decision provided by the Authority or the Appellate Authority to an applicant on matters or on questions specified in sub-section (2) of Section 97 or sub-section (1) of Section 100, in relation to the supply of goods or services or both being undertaken or proposed to be undertaken by the applicant.
Correct classification of goods - applicable rate of tax under GST Notification - HELD THAT:- The classification of the goods in question shall be the same as classified under the Customs Tariff Act, 1975 and shall be interpreted in terms of the Customs Tariff Act, 1975 for classifying any goods under the Notification No. 1/2017-Central Tax (Rate), dated 28-6-2017. Since, the goods in question is classified under Chapter Heading 4016 95 90 under the Customs Tariff, it has to be appropriately classified under the same chapter i.e. 4016 for levying of tax under GST not under the Chapter Heading 8607 - Further, as per specification provided by the applicant “In air suspension system, properties of air are used for cushioning effect. Enclosed pressurized air in a rubber below is called airspring.” Therefore, as per the submission, technical specifications and characteristics mentioned by the party in respect of airspring it appears that the disputed articles are air below made of rubber to be used in airspring. Furthermore, as per the specification “requirement for emergency rubber springs used in airsprings” : The emergency rubber bumper used in the airspring should be manufactured from natural rubber suitably compounded to conform to the requirements stipulated in STR (Schedule of Technical Requirements).
Thus, the process of making compounded rubber is none other than vulcanized rubber. Vulcanization makes rubber much stronger, more flexible, and more resistant to heat and other environmental conditions - the goods in question are made of rubber and the articles of vulcanized rubber which are excluded from Chapter 86 as per Section Note 2(a) to Section XVII, the party’s assumption is not acceptable and the correct classification of the airsprings would be 4016 95 90 and rate as per the Notification No. 1/2017-Central Tax (Rate) will be 18%.
Scope of Advance Ruling application - Whether the applicant can also be eligible for classifying imported goods under HSN Heading 8607 like its competitors? - HELD THAT:- It is again out of the purview of the mandate of the Advance Ruling u/s. 95(a) which provides that “advance ruling” means a decision provided by the Authority or the Appellate Authority to an applicant on matters or on questions specified in sub-section (2) of Section 97 or sub-section (1) of Section 100, in relation to the supply of goods or services or both being undertaken or proposed to be undertaken by the applicant.
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2019 (2) TMI 1907
Classification of goods - Vigilance Control Device (VCD) - Diagnostic Terminal (DT) - Master Controller System (MCS) - HELD THAT:- As per provisions of Note 1 of the Chapter 86, the items of following characteristics do not cover in Chapter 86 :
(a) Railway or tramway sleepers of wood or of concrete, or concrete guide-track sections for hover trains (Heading 4406 or 6810);
(b) Railway or tramway track construction material of iron or steel of Heading 7302; or
(c) Electrical signaling, safety or traffic control equipment of Heading 8530.
Thus, from Note 1 of Chapter 86 it is clear that electrical signaling, safety or traffic control equipments or Heading No. 8530 have been specifically excluded from purview of Chapter 86 - Furthermore, sub-heading 8530 includes the items with following characteristics: Electrical Signaling, Safety or Traffic Control Equipment for Railways Tramways, Roads, Inland Waterways, Parking Facilities, Port Installation or Airfields (Other Than Those of Heading 8608). The Goods are being classified under particular tariff item in accordance with General Rule for the interpretation of the Harmonized System. As per Rule 1, The titles of Sections, Chapters and sub-Chapters are provided for ease of reference only; for legal purposes, classification shall be determined according to the terms of the headings and any relative Section or Chapter Notes and, provided such headings or Notes do not otherwise require.
From the characteristic of the Vigilance Control Device (VCD), Diagnostic Terminal (DT) & Master Controller System (MCS), chapter Notes, Classification Rules and above discussion; it appears that they all fall in Code 8530 10 10 of Customs Tariff Act, 1975 - the rate of GST on the items of sub-heading 8607 is 5% whereas it is 18% of the items of sub-heading 8530.
It is also worth mentioning that the end use of the products by railways cannot be taken as a ground to determine the classification of the goods on question. As per the C.B.I. & C. Circular No. 30/4/2018-GST, dated 25-1-2018, regarding-clarification on supplies made to the Indian Railways classifiable under any chapter, other than Chapter 86. It is clarified that - (a) only the goods classified under Chapter 86, supplied to the railways attract 5% GST rate with no refund of unutilised input tax credit and (b) other goods (falling in any other chapter), would attract the general applicable GST rates to such goods under the aforesaid Notifications No. 1/2017-Central Tax (Rate), dated 28-6-2017, read with Notification No. 5/2017-Central Tax (Rate), dated 28-6-2017, even if supplied to the railways.
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2019 (2) TMI 1906
Refund claim for the service tax paid - Reverse Charge Mechanism on Works Contract Service under Banking and Financial Institution Services - Rejection on two grounds that the appellant has failed to show that the said service tax paid under Works Contract Service and the appellant has failed to prove that they have paid service tax - HELD THAT:- In this case, it is a fact on record that whatever service tax was payable by the appellant under Banking and Financial Institution Services, the same has been paid by them and there is no dispute that in the case of the service tax payable by the appellant during the impugned period under Banking and Financial Services has not been paid. The service tax for which refund has been filed by the appellant was paid under wrong head as Banking and Financial Service instead of Works Contract Service under reverse charge mechanism for the services availed by L.G. Electronics Pvt. Ltd. If it is a fact on record, in that circumstances, the refund claim cannot be rejected on technical grounds that the appellant has not paid service tax under Works Contract Service when the appellant produced a certificate issued by the Chartered Accountant showing that the service tax in question of which refund claim filed is none other than works contract service.
Appeal allowed - decided n favor of appellant.
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2019 (2) TMI 1905
Levy of GST - grant of Development rights - Valuation Modus Operandi to tax in GST - whole argument of the applicant regarding exemption of development rights from levy of GST hinges on its belief/ contention that the transfer of development rights amounts to sale of land - HELD THAT:- The term immovable property as defined in the CGST/SGST Act includes land, benefits to arise out of land, and things attached to the earth, or permanently fastened to the earth. Section 54 of Transfer of Property Act 1882 defines sale as transfer of ownership in exchange for a price paid or promised or part paid and part promised.
The application for seeking license from the Government for the development of developable land is to be made by RBIPL along with the applicant. EDPL is authorized to communicate with the Govt. on behalf of the RBIPL. The EDPL shall obtain the necessary governmental approval on behalf of RBIPL and associates. All municipal taxes, cesses and other public dues with respect to the developable land shall be paid and discharged by RBIPL. Further, the RBIPL has agreed to deposit the original titled documents of the developable land as guarantee for the performance of secured obligations, meaning thereby that RBIPL is the owner of the developable land - these terms of MOU make it crystal clear that the title of ownership of land vests with the RBIPL. Since RBIPL is the owner of the developable land, mere transfer of certain rights i.e. the development rights does not confer any title or ownership in the developable land upon the applicant.
Hence, the argument that the transfer of Development rights amounts to sale of land under Entry No. 5 of Schedule III appended to CGST Act (Activities or transaction which shall be treated neither as a supply of goods nor a supply of services) is outrightly rejected.
Value and time of supply - HELD THAT:- Notification 4/2018-CGST(Rate), dated 25.01.2018 notified that the liability to pay tax in case of transfer of development rights in exchange of constructed space shall be the date of allotment of constructed complex, i.e., the letter of allotment issued by the developer after the construction is complete. The notification clearly suggests the liability to pay tax on transfer of Development Rights - the value of supply has to be determined in accordance with Notification No. 11/2017 Central Tax (Rate), dated 28 June, 2017 read with notification No. 4/2018 Central Tax (Rate), dated 25 January 2018. The relevant entry for valuation is Sr. No. 3, Heading 9954 read with Para No. 2 of Notification No. 11/2017 Central Tax (Rate), dated 28 June, 2017.
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2019 (2) TMI 1904
Classification of supply - Supply of goods or supply of services - electricity/ electrical energy is treated as supply of goods and intra-states supply thereof - supply of utilities/ leasing are separate supplies or composite supplies? - exemption from payment of CGST in terms of Serial Number 104 Notification No. 2/2017-CT(Rate), dated 28.06.2017 - eligibility of Input Tax Credit.
Electricity - goods or service? - HELD THAT:- The Notification No. 2/2017-Central Tax (rate), dated 28th June, 2017 pertains to goods, the intra-state supply of which is exempted under the GST Act. The Entry No. 104 of this notification is regarding Electrical Energy. This suggests that Electrical Energy is a goods and not a service. There is also no doubt that electricity and electrical energy are one and the same thing - It is therefore, clear that electricity is a goods and not a service.
Having ruled that electricity is goods, we come to the question whether supply of electricity via DG sets is a goods or service. The power backup provided by the Agilent Technologies i.e. the lessee is in the form of a service. The charges for this supply are determined by the lessee as per its convenience. The DG set belongs to the Agilent Technologies, the maintenance charges are also borne by the Agilent Technologies, the expenses record pertaining to the DG set is also maintained by Agilent Technologies. Therefore, the authority has no hesitation in concluding that the provision of electricity supply/power back-up via DG set is in the form of a service and not goods - the electrical supply is liable to GST to the extent it is supplied through DG set.
Whether the supply of electricity and supply of utilities / leasing are separate supplies or composite supplies? - HELD THAT:- In the instant case, the supply is made by a taxable person and the number of supplies are also multiple. But as discussed earlier, the supply of electricity to the extent of it being supplied through grid is exempt from GST and, therefore, the condition of two or more taxable supplies is not satisfied. Further, the supply of utilities and supply of electricity are neither naturally bundled together nor are they supplied in conjunction with each other. Also, neither of the two supplies i.e. utility services and electricity supply can be termed as a principal supply and the other one being a natural ancillary - the supply of utility services and electricity supply are separate supplies - The provision of electric supply by way of DG set forms part of the utility services taxable at 18% whereas the supply of electricity by way of grid is exempt from GST.
Input Tax Credit charged on renting services and electricity - HELD THAT:- It is understood that renting of business premises is indispensable for carrying any business, no matter how small the scale is. It is also admitted that renting of business premises is in the course and furtherance of business as space is required for carrying out the operations relating to business - it is observed that since the grid supplied electricity is exempt from GST, the issue of credit availability does not arise. As regards, the tax on supply of electricity through DG set, the Authority is of the opinion that the applicant is entitled to credit of input tax paid with respect to tax paid on availing the said service.
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2019 (2) TMI 1903
Taxability - lien or mortgage charges and stock transfer fees received by the applicant from the service receiver - taxable under section 9 of Central Goods and Service Tax Act, 2017 and Section 9 of Haryana Goods and Service Tax Act, 2017 or exempt under section 11 of Central Goods and Service Tax Act, 2017 with respect to both agricultural and non-agricultural produce stored and warehoused in the warehouses of the applicant? - HELD THAT:- On perusal of Notification No. 12/2017- Central Tax (Rate) dated 28.06.2017, the Advance Ruling Authority reaches to the conclusion that the services in question are taxable services. The Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017 provides for Nil rate of tax with respect to loading, unloading, packing, storage or warehousing of agricultural produce. The notification nowhere exempts the charge/mortgage/lien fee and stock transfer fee charged by the applicant from the service recipient in case of agricultural goods from the Goods and Services Tax.
The scope of storage and warehousing services as defined in CBEC Circular No. B/II/1/2002-TRU dated 01.08.2002 does not encompass the mortgaging and stock transfer service - The charge/mortgage/lien fee and stock transfer fee with respect to non-agricultural goods stored and warehoused is liable to tax under the CGST/ HGST Act, 2017.
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2019 (2) TMI 1902
Taxable services or not - provision of services (Manpower Supply) of tube well operator for operation of tube well and booster of drinking and irrigation water supply in various villages - HELD THAT:- As per perusal of the copy of contract, submitted by applicant along with his application, only manpower supply services are to be provided by the applicant and since, no supply of goods is involved, such services qualify as pure services. Further, the said services are being supplied by applicant to Union Territory of Chandigarh as the contract is awarded by Executive Engineer, Project P.H. Division No. 3, Chandigarh functioning under the Department of Engineering of Union Territory of Chandigarh. The functions entrusted to a panchayat under the Eleventh Schedule to Article 243G of the Constitution include Agriculture, Land Improvement, Minor irrigation, Water management, Drinking water, Rural housing, Fuel and Fodder etc and therefore the activities performed by applicant under the said contract are services supplied in relation to any function entrusted to a Panchayat under article 243G of the Constitution.
The provision of services (Manpower Supply) of tube well operator for operation of tube well and booster of drinking and irrigation water supply in various villages covered under Panchayat are exempt being covered under entry at Sr. No. 3 of CGST Notification No. 12/2017-Centra1 Tax (Rate), dated 28th June, 2017.
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2019 (2) TMI 1901
Disallowance u/s 14A r.w.r. 8D - Suo moto disallowance by assessee - HELD THAT:- As the assessee itself had offered a disallowance under Sec.14A, therefore, the CIT(A) had in all fairness restricted the disallowance upto the said amount. We thus not finding any infirmity in the order of the CIT(A) who as observed by us hereinabove had restricted the addition to the extend as offered by the assessee in its return of income, uphold the same to the said extent.
Adjustment made by the A.O to the ‘book profit’ under Sec. 115JB on account of expenses relatable to exempt income under Sec.14A. - HELD THAT:- As relying on VIREET INVESTMENT (P.) LTD. [2017 (6) TMI 1124 - ITAT DELHI] the adjustment made under Sec. 14A is not to be considered for computing the ‘book profit’ under Sec. 115JB - We thus uphold the order of the CIT(A) to the said extent. Decided against revenue.
Additional depreciation u/s 32(iia) - A.O being of the view that as per the provisions of Sec.32(1)(iia) of the I.T. Act the additional depreciation was to be allowed @ 20% of the actual cost of machinery of plant in the year in which it had been acquired and installed and could not be spilled over to the subsequent years, thus declined to allow the additional claim of depreciation @ 10% - HELD THAT:- There is no restriction made available on the statute as per which the assessee who had put to use the new machinery for a period of less than 180 days during a year, would be divested of its entitlement to claim the balance 10% of the additional depreciation in the succeeding assessment year. Our aforesaid view is fortified by the judgment of CIT, Madurai , Vs. T.P. Textiles (P) Ltd [2017 (3) TMI 739 - MADRAS HIGH COURT] and Rittal India Pvt. ltd. [2016 (1) TMI 81 - KARNATAKA HIGH COURT]. We thus being of the considered view that no infirmity arises from the order of the CIT(A) who had rightly deleted the disallowance of additional depreciation.
Bad debts claim - assessee sought adjudication on its claim of ‘bad debt’ on the basis of the facts which were already available on record - HELD THAT:- As per the settled position of law as, we are of the considered view that no infirmity does emerge from the order of the CIT(A) who had directed the A.O to consider the said claim in the backdrop of the judgment of the Hon’ble Supreme Court in the case of TRF Ltd Vs. CIT [2010 (2) TMI 211 - SUPREME COURT] and the CBDT Circular No. 12/2016, dated 30.05.2016. We thus finding ourselves to be in agreement with the view taken by the CIT(A), uphold his order to the said extent. The Grounds of appeal No. 5 and 6 raised by the revenue before us are dismissed.
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2019 (2) TMI 1900
Addition u/s. 41(1) - cessation of liability - AO observed from the schedule of sundry creditors that there were creditors whose outstanding balances as on 31/03/2012 & 31/03/2013 had remained the same - HELD THAT:- CIT(Appeals) observed that the assessee has not filed single submission to controvert the findings of the AO. In the statement of facts, the assessee has filed only the order of Assessing Officer without any new supporting documents to represent her case. This fact shows that the matter needs to be remanded to the file of Ld. CIT(Appeals) for adjudication on merits.
Accordingly, in the interest of justice, we set aside the order of Ld. CIT(Appeals) and restore this issue i.e. with regard to the addition made u/s.41(1) of the Act back to the file of the Ld. CIT(Appeals) to adjudicate on merits after providing reasonable opportunity of hearing to the assessee. At the same time, we direct the assessee to appear before the Ld. CIT(Appeals) with relevant documents and evidences in support of her case and to represent the case on merits, immediately on receipt of this order. Any service of notice is dispensable. Appeal of the assessee partly allowed for statistical purposes.
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2019 (2) TMI 1899
Reopening of assessment u/s 147 - capital gain computation - assessee had not shown any long term capital gain under the provision of section 45(2) r.w.s. 2(47) and section 55(2)(b)(i) - CIT(A) has assigned the rate for land at ₹ 900/- per sq. mt. on the date of transfer of the aforesaid land as to the firm - HELD THAT:- We observed there was no material on record which could have clarified the impugned discrepancy of incorrect reporting of income by the assessee. AO was having reasons of to believe that income chargeable to tax has escaped assessment for the year under consideration. After considering the above facts and circumstances as elaborated supra we justify the findings of the ld. CIT(A) that the assessing officer reopened the assessment with valid reason. Therefore, the appeal of the assessee on this issue is dismissed.
Capital gain computation - AO held that non-agricultural land of 4960 kg mtrs held as stock in trade by the assessee was brought as capital contribution to the firm M/s. C.N. Builders and Developer on 18-10-2003 - HELD THAT:- We observe that impugned land forming stock-in-trade of assessee was transferred as a capital contribution by assessee therefore profits or gains arising from transfer of this asset would be chargeable to tax as assessee's income of previous year in which such transfer has taken place. Lower authority has failed to make any reference to the Valuation Officer u/s 55A of the act to determine the fair market value of the asset we direct the assessing officer to adopt rate of ₹ 900/- per sq. mts for the value of the impugned land as determined by the Ld.CIT(A) in his order dated 21st July 2010.Accordingly this ground of appeal of the assessee is partly allowed.
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2019 (2) TMI 1898
Grant of Anticipatory Bail - fraudulent availment of input tax credit - fake invoices without actual supply of Goods/Services - According to Department the petitioners are adopting a modus operandi whereby they make payment to the suppliers of invoices without movement of goods/services through banking channel and get back such amount after payment of agreed commission to the supplier of fake invoices - Section 132 of the Central Goods and Services Act, 2017 - HELD THAT:- The enactment in question has come into force very recently with a laudable object of one country one tax. Therefore wherever the department finds that certain provisions in the Act is misused by creating fake invoices and input tax credit is being availed without any movement of goods, the same has to be curbed and nipped in the bud to ensure that it does not grow into another mega scam having a direct impact on the economy of this nation. Since the department has collected some prima facie materials , they want to act fast before it becomes a huge racket, failing which the entire economy of this country would weaken and collapse - If the petitioners are conducting genuine business through the above said companies, they can easily prove during the investigation the actual movement of goods, which will all be borne out by documents. If the department is satisfied regarding the same, the department will leave out the companies belonging to the petitioners and proceed further with the investigation.
In the considered view of this Court, in matters of this nature, the department must be given the complete independence to investigate the cases since it involves the national interest. This Court by entertaining an Anticipatory Bail Petition and by imposing certain conditions, should not tie the hands of the department in proceeding further with the investigation since what has been unearthed till now is only the tip of the iceberg and there is a long way to go for the department to find out how long this fake invoices have extended their tentacles.
As argued by the learned counsel for the petitioners, it is true that the entire issue is borne out by documents and once the petitioners co-operate for the investigation by submitting all the relevant documents, they should not be unnecessarily arrested. However, it is a settled proposition of law that this Court while considering a petition for Anticipatory Bail has to necessarily taking into consideration the nature and gravity of the accusation in a given case. When a case involves serious offences, grant of Anticipatory Bail by itself will cause prejudice to the investigation. Where the accused persons are charged of violation of CGST Act, involving colossal loss of revenue to the exchequer and the investigation is at a very nascent stage, prudence demands that this Court should lay of its hands from the investigation and allow complete independence to the prosecuting agency to proceed further with the investigation.
This Court is not inclined to entertain these Anticipatory Bail Petitions - Application dismissed.
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2019 (2) TMI 1897
Disallowance u/s 14A r.w. Rule 8D(2)(iii) - HELD THAT:- This issue is covered in favour of the assessee in various decisions of the ITAT and one of such decisions is the decision of the Special Bench of Delhi ITAT in the case of Vireet Investments Private Limited [2017 (6) TMI 1124 - ITAT DELHI] wherein it has been held that the disallowance under Rule 8D(2)(iii) can be only of the average of investments which have yielded exempt income. Respectfully following the same, the additional grounds of appeal are allowed.
Computation of income u/s 115JB - This issue is also covered in favour of the assessee by the Special Bench, ITAT Delhi decision in the case of Vireet Investments Private Limited (supra) wherein it was held that the computation u/s 115JB should be made without resorting to the computation as contemplated u/s 14A r.w. Rule 8D of the IT Rules, 1962. Accordingly, grounds raised by the assessee are allowed.
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2019 (2) TMI 1896
Grant of Bail - attachment of Bank accounts - schedule offences - principles of parity - Division Bench, with regard to co-accused pradeep Garg directed the Special Court to pass the bail order in the light of order of Supreme Court in OMPAL SINGH (PRADEEP GARG) VERSUS CENTRAL BUREAU OF INVESTIGATION (CBI) & ANR. [2018 (4) TMI 1845 - SC ORDER] granting or refusing bail to co-accused, Pradeep Garg in schedule offences - HELD THAT:- Hon’ble Supreme Court in Nikesh Tara Chandra’s case [2017 (11) TMI 1336 - SUPREME COURT] while granting bail to the applicant in schedule offences, has opined that the entire money of the State shall stand secured and in this regard bank accounts of the applicant to the tune of ₹ 5.11 Crore has also been attached by the E.D. The applicant is in jail in this matter since 16.01.2018 and Co Accused pradeep Garg standing on identical footing has been released on bail by trial Court in compliance of order passed by Division Bench of this Court. In view of above and on the principle of parity the applicant is also entitled to be released on bail.
In view the nature of the offence, evidence, complicity of the accused, severity of punishment, submissions of the learned counsel for the parties, the applicant has been released on bail by Honble Supreme Court in schedule offences, without expressing any opinion on the merits of the case, the applicant has made out a case for bail - Bail application allowed.
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2019 (2) TMI 1895
Correct head of income - service charges and furniture hire charges received by the assessee -“income from other sources” or “profit and gains of business and profession” - HELD THAT:- There is no error in the order of the Ld. CIT(A) on the issue in dispute and accordingly we uphold that no business activity was carried out by the assessee during the year under consideration and the income from service charges and hire charges is assessable under the head “income from other sources”. The ground No. 1 of the appeal is accordingly dismissed.
Disallowance of the various expenses claimed - in absence of any business activity same cannot be allowed to the assessee except expenses incurred relevant to the income assessed under the head “income from other sources”- HELD THAT:- CIT(A) has examined each and every expenses sustained by him. As regard the “watch and ward”, “water and electricity”, “telephone expense”, “Internet expense” and “office maintenance expenses” towards the premise at B-40, Maharani Bagh, he allowed 1/6th of the expenses in view of the part of the building was used as registered office and disallowed the balance as major part of the premise was used for residential purpose of the directors and their family.
Legal & professional charges, the Ld. CIT(A) has allowed payment of ₹ 2, 78, 700/-to m/s Vaish Associates against income from other sources. The expenses of ₹ 22,060/- have been found related to let out property and accordingly he has disallowed.
Expenses paid to two professionals namely Mr. Suren Singh Rasaily and Mr. Dilip Sudhakar Deshmukh, the Ld. CIT(A) himself summoned the persons and carried out the enquiries, and after detailed enquiry, he concluded that payment of professional charges were not incurred wholly and exclusively for the purpose of earning “income from other sources”. Similarly he has examined allowability of the depreciation allowance , office maintenance expenses and other expenses under the head “income from other sources”. We do not find any error in the above factual findings of the Ld. CIT(A).
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2019 (2) TMI 1894
Forgery and preparing false documents - dispute is of civil nature - the complainant alleged that the Respondents made themselves liable for being prosecuted Under Sections 420, 465, 467, 468, 471 read with Section 34 of the Indian Penal Code, 1860 - HELD THAT:- It is settled law that the Magistrate, at the stage of taking cognizance and summoning, is required to apply his judicial mind only with a view to taking cognizance of the offence, or in other words, to find out whether a prima facie case has been made out for summoning the Accused persons.
The High Court ought not to have set aside the order passed by the Trial Court issuing summons to the Respondents. A perusal of the complaint discloses that prima facie, offences that are alleged against the Respondents. The correctness or otherwise of the said allegations has to be decided only in the Trial. At the initial stage of issuance of process it is not open to the Courts to stifle the proceedings by entering into the merits of the contentions made on behalf of the Accused. Criminal complaints cannot be quashed only on the ground that the allegations made therein appear to be of a civil nature. If the ingredients of the offence alleged against the Accused are prima facie made out in the complaint, the criminal proceeding shall not be interdicted.
Appeal allowed.
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2019 (2) TMI 1893
Legality of the order being passed by AO on a non-existing entity - Cairn India Ltd is an amalgamated company, which has seized to exist in the eyes of law pursuant to amalgamation with Vedanta Ltd.- HELD THAT:- Assessment on a company, which has been dissolved/amalgamated u/s 391 and 394 of the Companies Act 1956 is invalid and further held that framing assessment on a non-existing entity is a jurisdictional defect which cannot be cured u/s 292B of the Act. See DIMENSION APPARELS PVT. LTD. [2014 (11) TMI 181 - DELHI HIGH COURT]
We have no hesitation in holding that the assessment order and the order of the TPO are non est. Since the foundation has been removed, the super structure must fall. See MARKETING SERVIEING PVT. LTD. [2009 (9) TMI 917 - DELHI HIGH COURT] - Decided in favour of assessee.
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2019 (2) TMI 1892
Contempt petition - whether the Magistrate was justified in taking cognizance of an offence punishable under Section 193 of the IPC on the basis of a private complaint? - HELD THAT:- The offences under Section 195(1)(b)(i) and Section 195(1)(b)(ii) are clearly distinct. The first category of offences refers to offences of false evidence and offences against public justice, whereas, the second category of offences relates to offences in respect of a document produced or given in evidence in a proceeding in any court.
Section 340 of Cr.P.C. makes it clear that a prosecution under this Section can be initiated only by the sanction of the court under whose proceedings an offence referred to in Section 195(1)(b) has allegedly been committed. The object of this Section is to ascertain whether any offence affecting administration of justice has been committed in relation to any document produced or given in evidence in court during the time when the document or evidence was in custodia legis and whether it is also expedient in the interest of justice to take such action. The court shall not only consider prima facie case but also see whether it is in or against public interest to allow a criminal proceeding to be instituted - clauses under Section 195(1)(b) of the Cr.P.C. i.e. sub-section 195(1)(b)(i) and sub¬section 195(1)(b)(ii) cater to separate offences. Though Section 340 of the Cr.P.C. is a generic section for offences committed under Section 195(1)(b), the same has different and exclusive application to clauses (i) and (ii) of Section 195(1)(b) of the Cr.P.C.
The case in hand squarely falls within the category of cases falling under Section 195(1)(b)(i) of the Cr.P.C. as the offence is punishable under Section 193 of the IPC. Therefore, the Magistrate has erred in taking cognizance of the offence on the basis of a private complaint - Thus, High Court has rightly set aside the order of the Magistrate.
Appeal disposed off.
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2019 (2) TMI 1891
Withdrawal of appeal - rectification of mistake - HELD THAT:- As appellant seeks liberty to withdraw this appeal and approach this Court in the event his application for rectification is decided against him. He also states that, in that event, all grounds urged in the appeal may be kept open. Liberty granted. In case, the appellant so wishes, at a later stage, to approach this Court, all grounds urged in this appeal shall be kept open. This appeal is dismissed as withdrawn.
This appeal is dismissed as withdrawn in the above terms.
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2019 (2) TMI 1890
TP Adjustment - Determination of arm’s length price of international transactions - comparable selection - TPO applying arbitrary filters to arrive at a fresh set of companies as comparable to the Appellant - HELD THAT:- Companies functionally dissimilar with that of assessee need to be deselected from final list.
TP adjustment of charging mark up of recovery transaction with its AE - HELD THAT:- AR filed the details on this aspect which were overlooked by the TPO. Whereas the learned DR supported the orders of the lower authorities and could not controvert the submissions of the learned AR.
We, on perusal of the material filed and the arguments of the learned AR and learned DR , are of the opinion that on the principles of natural justice, when the decision is being taken by TPO on mark-up in respect of the assessee-company, the submissions filed cannot be ignored and accordingly, we restore this disputed issue of the assessee to the file of the AO/TPO to consider and pass a reasoned order.
Assessee is entitled for MAT credit u/s 115JAA which was not granted. Accordingly, we direct the AO to grant MAT credit as per provisions of law to the same.
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