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Showing 221 to 240 of 1551 Records
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2024 (2) TMI 1331
Addition u/s 68 - unexplained cash credit - capital contribution in cash by the partners - Addition in the hands of firm v/s partners - As per AO Assessee has not furnished any supporting document like bank statement of the partners from where the cash amount have been withdrawn or any corroborative evidence to explain the source and nature of the cash so deposited - HELD THAT:- Since the partners have substantial returned income to the tune of Rs. 24.45 Lac and Rs. 24.00 lac, who have made the capital contribution of Rs. 14.50 lac and 10 lacs, thus, the identity and creditworthiness of such partners cannot be doubted.
If the Ld. AO was not convinced with the source of amounts deposited by the partners, then such addition could have been made in the hands of such partners by invoking the relevant provisions of law but no addition was called for in the case of assessee firm, who have discharged its primary onus u/s 68 by providing the details of the partners from whom such funds were received.
Thus the addition made by the Ld. AO and affirmed by the Ld. CIT(A) w.r.t. capital contribution in cash by the partners cannot be sustained in the hands of assessee firm. Our decision is supported by various judgments relied upon by. Ground no. 1 of the present appeal is decided in favor of the assessee.
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2024 (2) TMI 1330
Condonation of delay in filing the appeal - delay of 326 days - sufficient cause - misguidance of the former Tax Consultant - HELD THAT:- It is always to be kept in mind that the condonation of delay is always a double edged sword, which has sharp edges on both sides and to be handled carefully by any party. - In our considered view, the assessee has demonstrated a reasonable cause for not filing the appeals within the statutory period of limitation, on the mis-representation of former Tax Consultant resulting in passing exparte orders and filing appeals with delay. - Delay condoned.
Assessment u/s 153A - unexplained cash credits - incriminating material found in search or not? - Penalty levied u/s 271(1)(c) - HELD THAT:- When an assessment has to be made in relation to the search or requisition u/s 153A of the Act, namely, in relation to material disclosed during the course of search or requisition, if in relation to any particular assessment year, at the same time when there is no incriminating material found, no addition or disallowance can be made in relation to that assessment year in exercise of powers u/s 153A and the earlier assessment shall have to be reiterated.
This legal preposition is now settled in the batch of cases namely PCIT, Central-3 -Vs- Abhisar Buildwell Pvt. Ltd. [2023 (4) TMI 1056 - SUPREME COURT] holding that in respect of completed assessments/unabated assessments, no addition can be made by AO in the absence of any incriminating material found during the course of search u/s 132 or requisition made u/s 132A of the Act.
We have no hesitation in deleting the additions made on account of unexplained cash credit made by the AO without any incriminating material found during the course of search from the premises of the assessee.
Penalty u/s 271(1)(c) - Since the additions made on the quantum appeals for the above assessment years are already deleted vide paragraphs 10 and 11 of this order, consequently the present penalty appeals has no legs to stand and therefore the penalty levied is hereby deleted.
Assessee appeal allowed.
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2024 (2) TMI 1329
Non-prosecution of appeal by assessee - Undisclosed investment - as alleged assessee could not prove identity, genuineness of the transaction and creditworthiness of the parties - HELD THAT:- As none appeared on behalf of the assessee in spite of service of notices, the assessee in its letter head sought for adjournment on 16.03.2021, whereby the appeals were adjourned to 15.04.2021. Again another adjournment was sought for 29.12.2022 and the appeals adjourned to 13.02.2023. It is thereafter, eleven occasions the above appeals were adjourned from time to time and finally on 01.02.2024, none appeared on behalf of the assessee, in spite of service of notices to the assessee. This clearly shows that the assessee is not interested in pursuing the appeal. Further the assessee failed to file any documents in support of its Grounds of appeal.
Also noticed there is delay of 790 days in filing this appeal, but the assessee has not filed any Affidavit explaining the delay. In the absence of condonation petition explaining the delay, the present appeal is not maintainable and liable to be dismissed in limine.
Appeal filed by the assessee is hereby dismissed.
Where the appellant in spite of notice is persistently absent and the Tribunal on facts of the case is of the view that the appellant is not interested in prosecuting the appeal, it can in exercise its inherent power to dismiss the appeal for non- prosecution. In the case of CIT Vs. B. N. Bhattacharya [1979 (5) TMI 4 - SUPREME COURT], it was held that appeal does not mean merely filing of appeal but effectively pursuing it. Appeal filed by the Assessee is dismissed in limine.
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2024 (2) TMI 1328
Addition u/s 69 - repayments of loan/creditor - CIT(A) deleted the addition as observed that only those ‘investments’ that are found to have been ‘not recorded in the books’ qualify for addition under the said section, if assessee fails to offer proper/satisfactory explanation. HELD THAT:- In the instant case the transactions made by the assessee that are subjected to addition under this section are all reflected in the books of account maintained by him. Nowhere did the assessing officer state that these repayments were made from undisclosed sources.
AO perused 3CD report and found that that repayments have been disclosed in clause 31(c) of the Tax Audit Report.
CIT(A) as observed that repayments of loan/creditor cannot be regarded as 'investments' for the reason that investments are assets of the investor which are likely to yield returns and investment as such can be redeemed to obtain the principal. So, the repayment of loan disclosed in the books of account would not come under the purview of Section 69. We also note that repayment of amount was made through banking channel and also duly recorded, in the books of accounts.
As gone through the party-wise, unsecured loan, findings given by the ld CIT(A) and noted that there is no infirmity in the conclusion reached by ld CIT(A). Hence, we dismiss ground No.1 raised by the Revenue.
Addition on the account of Section 24 v/s business head u/s 37 - interest paid on housing loan - CIT(A) deleted addition as per Section 36(1)(iii) which is the relevant provision regarding Interest on borrowed capital, according to which the amount of interest paid in respect of capital borrowed for the purpose of Business and Profession of assessee shall be allowed - HELD THAT:- The provisions of Section 37 is a general in nature allowing deduction of an expenditure laid out or expended wholly and exclusively for the purposes of the business. Since, AO in the assessment order had given a categorical finding that the assessee had availed a loan by mortgaging a business asset and that the loan is utilised for the purposes of business, then the deduction claimed by the assessee towards interest paid on such loan utilised for the purpose of business is an allowable deduction under the head “income from business” and not under the head “income from house property”.
CIT(A) correctly observed that section 36(1)(iii) of the Act, which is the relevant provision regarding Interest on borrowed capital, according to which, the amount of interest paid in respect of capital borrowed for the purpose of Business & Profession of assessee shall be allowed subject to the section 43B - CIT(A) observed that when the capital is borrowed for acquisition of a capital asset, then interest liability pertaining to the period till the date such asset is put to use shall not be allowed as deduction. Going by the fact noted by AO, in the assessment order and the relevant provisions of the IT Act, it is held by ld CIT(A) that the disallowance of interest claim to made by AO is not in accordance with the provisions of the statute and therefore, ld CIT(A) deleted the same correctly - Decided against revenue.
Addition of cash deposit u/s 68 - during the demonetization period, the assessee has deposited cash in three banks - CIT(A) deleted addition - HELD THAT:- CIT(A) noted from the assessee`s balance sheet that the bank accounts in question in which the cash deposits were made by the assessee during the demonetization period formed part of its books of account. Considering the aforesaid facts, when the bank accounts in question, are all duly been accounted for by the assessee in its books of account for the year under consideration, therefore, AO by not rejecting the said books of account had clearly accepted that the cash deposited by the assessee firm during the year under consideration in the said bank accounts was out of its disclosed sources. Based on this factual position, the ld CIT(A) deleted the addition. We note that ld CIT(A) has passed a reasoned and speaking order. The conclusions arrived at by the CIT(A) are, therefore, correct and admit no interference by us - Thus dismiss the ground raised by the Revenue.
Admission of additional evidenced by CIT(A) - allegation of violation of Rule 46A of the Income Tax Rules - HELD THAT:- We note that ld CIT(A), during the appellate proceedings, vide its letter dated 07.12.2022, the additional evidences submitted by the assessee before ld CIT(A), were forwarded to Assessing Officer for his examination and remand report thereon. The additional evidences were resent to Assessing Officer also, however, Assessing Officer failed to submit the remand report. Hence, we note that there was no violation of provisions of Rule 46A of the I.T. Rules, therefore, we dismiss both the grounds raised by the Revenue.
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2024 (2) TMI 1327
Accrual of income in India - Fixed place Permanent Establishment ("PE") for business in India, to carry on the business of sale of software products - HELD THAT:- The issues involved have been squarely covered by the order of the coordinate bench [2023 (4) TMI 1303 - ITAT DELHI] wherein as find merit into the contention of the assessee that the Assessing Authority was not justified in making addition in the hands of the assessee when in the case of alleged PE of the assessee, the transactions have been treated to be arm’s length price. Furthermore, the assessee has pointed out that while making addition, the AO has also included the transaction related to hardware whereas allegation of PE is related to software. In the light of the binding precedents, we are of the considered view that the authorities below erred in making the impugned additions. We therefore, direct the AO to delete the same. Decided in favour of assessee.
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2024 (2) TMI 1326
Grant of Advance Authorisation - export of goods - Fulfilment of Export Obligation or not - whether discretionary jurisdiction should be exercised in light of the redemption letter - HELD THAT:- On record redemption letter, It is evident that the export obligation was met in full by the petitioner both with regard to value and quantity. This letter was issued after the order impugned herein was issued.
At the end of the day, an exporter was required to fulfil export obligations as a condition for the grant of advance authorisation. The documents on record include the redemption letter, and such redemption letter shows that the export obligation was fulfilled in entirety. In those circumstances, the petitioner must be provided an opportunity to place relevant documents before the 1st respondent. Therefore, the impugned order calls for interference.
Hence, the impugned order is quashed and the matter is remanded to the 1st respondent for reconsideration. The petitioner is permitted to place all relevant documents before the 1st respondent. Upon consideration thereof, the 1st respondent is directed to issue a fresh order within a period of three months from the date of receipt of a copy of this order after providing a reasonable opportunity to the petitioner.
The writ petition is disposed of on the above terms.
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2024 (2) TMI 1325
Refund of the Antidumping duty - monetary limit prescribed for filing an appeal before the High Court has been enhanced to Rs. 1 Crore by notification - HELD THAT:- Since the subject appeal involves a duty which is the below the monetary limit prescribed and is not covered by the exceptions stipulated in the subject notification, this appeal is dismissed on the ground of Low Tax Effect.
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2024 (2) TMI 1324
Recovery of Duty drawback - period for realization of export proceeds - Shipping bills relating to the export of goods described as ''cotton power-loom made up articles'' - HELD THAT:- The documents on record include the communication dated 06.04.2013 and the annexure thereto. Also on record are several BRCs, which appear to correspond to the 33 shipping bills, which form the subject matter of the impugned order. Thus, there is prima facie evidence that the export proceeds were realized. In order to provide an opportunity to the petitioner to place these documents before the respondent for consideration, interference with the impugned order is warranted.
Therefore, the impugned order is quashed and the matter is remanded for re-consideration. The petitioner is permitted to place all the relevant documents relating to realization of export proceeds before the respondent within a maximum period of 15 days from the date of receipt of a copy of this order.
W.P. is disposed of on the above terms.
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2024 (2) TMI 1323
Jurisdiction - Power of designated officer of DRI to issue SCN - Challenging the legality of Show Cause Notice issued - HELD THAT:- We are of the opinion that the Petitioner needs to canvass such legal position as asserted in the present proceedings before the adjudicating officer, who, as fairly pointed out on behalf of the Respondents, would certainly take into consideration all such contentions, including the issues on the law laid down by the Supreme Court in the case of Canon India Pvt. Ltd.[2021 (3) TMI 384 - SUPREME COURT] and pass appropriate orders on the show cause notice.
The Petition is accordingly disposed of directing the Respondents to adjudicate Show Cause Notice dated 6th February 2020 as expeditiously as possible, and, in any event, within a period of 6 months from today. As the Show Cause Notice is issued about 4 years back, there cannot be any further delay in the adjudication of the same.
All contentions of the Petitioners are expressly kept open for agitation in the adjudication of the Show Cause Notice - Petition is disposed of in the aforesaid terms.
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2024 (2) TMI 1322
Application filed u/s 438 of the Code - seeking pre-arrest bail - found carrying areca or beetle nuts, instead of grinding wheels, as was declared in IGM and bill of lading by its importer - confiscation of goods - Offence punishable u/s 135 of the Customs Act - HELD THAT:- Following the decision of the Apex Court in the case of filing of an FIR is not a condition precedent to exercise the powers/jurisdiction u/s 438 of the Code. However, the concerned accused has to show/demonstrate that he has a reasonable apprehension or belief that he may be arrested in connection with a cognizable offence. The Apex Court has further observed that the use of the expression, ‘Reason to Believe’ in Section 438(1) of the Code shows that the belief, that the applicant may be so arrested, must be founded on reasonable grounds only if there is something tangible to go by, on the basis of which, it can be said that the applicant’s apprehension that he may be arrested, is genuine.
The present petitioner fails to show or display any well-founded reason to believe/apprehend that he will be arrested. As held by the Hon’ble Apex Court in ‘Shri Gurubaksh Singh Sibbia and Others’[1980 (4) TMI 295 - SUPREME COURT] which was subsequently followed in the case of ‘Sushila Aggarwal and others Vs. State (NCT of Delhi) and another’, [2020 (1) TMI 1193 - SUPREME COURT], no blanket orders can be passed to the effect that ‘Not to Arrest’ the petitioner. In view of the fact that Respondent No. 1-DRI has powers to call the petitioner, by issuing summons u/s 108 of the Customs Act, the petitioner is bound to comply with the same and therefore, none of the decisions/authorities relied on by the learned Senior Advocate for the petitioner in given background of facts shall not help the petitioner’s case.
There are several vexed questions, viz. Whether, the present petitioner is Aakash or Abbas Gulamhusen Hariyani and as to whether, Aakash is using the identity of the petitioner or the petitioner is using the name of Aakash, and the answers to the same are needed to be found out by the prosecuting agency and therefore also, the petitioner has to comply with the summons issued u/s 108 of the Customs Act.
Resultantly, this petition fails and is DISMISSED, accordingly. Interim relief, if any, stands vacated.
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2024 (2) TMI 1321
Levy of Social Welfare Surcharge (SWS) on Goods Imported under MEIS Scheme - Benefit of Exemption Notification No. 32/2005-Cus. - benefit of Zero duty SWS - HELD THAT:- In the present case, it is not in dispute that the licensing authority has raised any objection with regard to non-observance or non-fulfillment of the conditions mentioned in the notification dated 08.04.2015. Thus, it would not be proper on the part of the Customs authorities to say that debit of customs duty in the MEIS scrip would disentitle the imported goods from the claim of the benefit of ‘Zero’ rate SWS. Since, the effective rate of the customs duty is ‘NIL’ or ‘Zero’, by virtue of the notification dated 08.04.2015, the rate of SWS when calculated in terms of Section 110 ibid would automatically become ‘zero’, inasmuch as SWS is to be calculated not on the value of the goods, but on the duty of customs levied on the imported goods, which is evident from sub-section (3) of Section 110 of the Finance Act, 2018. The said statue has mandated that SWS levied under Sub-section (1) of Section 110, shall be calculated at the rate of 10% on the customs duty levied and collected by the Central Government. In the present case, since no customs duty is leviable in terms of notification dated 08.04.2015, there is no question of payment of SWS.
Since there was ambiguity in context with the subject issue, the Tax Research Unit in the Department of Revenue, Ministry of Finance vide Circular No.3/202-Customs dated 01.02.2022 had clarified that calculation of SWS is dependent on amount of the customs duty that is actually payable and not otherwise. It has been in explained in specific terms that legal provisions does not require calculation of SWS on notional value of customs duty calculated, as in the present case, the BCD is calculated for purpose of accounting by debit entry in the MEIS scrip and the payment of BCD is exempt under Section 25 ibid.
Thus, we find that the clarification issued by the Ministry of Finance amply makes it clear that SWS is ‘NIL’, when the aggregate of customs duties for calculation of SWS is ‘Zero’.
Learned AR also made a submission that the Revenue has filed Review Petitions against the judgement of the Hon’ble Bombay High Court it the case of La Tim Sourcing (India) and La Tim Metal & Industries Ltd. [2019 (10) TMI 506 - BOMBAY HIGH COURT], and the same is pending. In this regard, we find that the Hon’ble High Court of Bombay had taken note of the judgements cited by the Revenue as decided by Hon’ble Madras High Court and after proper examination of the issues in hand had decided the case by holding the view that SWS shall be computed as ‘Nil’ when BCD is ‘Nil’. Inasmuch as the Hon’ble Supreme Court had already upheld the decision of the Hon’ble Gujarat High Court in the case of Pasupathi Acrylon Ltd.[2014 (1) TMI 169 - GUJARAT HIGH COURT] wherein it was held that no cess is payable when BCD is ‘Nil’, judicial discipline would not permit to take a different view than the one decided by the Hon’ble Apex Court. In view of the above and since, the said judgements of Hon’ble High Court of Bombay are in operation, this Tribunal is bound to follow the ratio decided therein.
Thus, we do not find any merits in the impugned orders passed by the learned Commissioner of Customs (Appeals). Therefore, by setting aside the impugned orders, the appeals are allowed in favour of the appellants, with consequential relief, if any.
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2024 (2) TMI 1320
Denial the benefit of the exemption notification no. 45/2017-Cus and 46/2017-Cus - Re-importation of the goods - The appellant exported goods to Thailand but faced rejection due to quality issues - switch over to the benefit of another Notification No. 158/95-Cus - more than one Notifications are applicable for the goods - demand of duty - penalty - conditions required to be fulfilled of the same notification - HELD THAT:- It is settled law that where more than one Notifications are applicable for the goods, or to the concerned transactions, attracting levy of any duty or tax, it is the choice and the option of the citizen/assessee to claim benefit of a Notification that suits him; and it is also permissible to the citizen/assessee to claim benefit of any Notification at a later stage notwithstanding the fact that the citizen/assessee claimed benefit of another Notification at the initial stage.
It is evident that to be eligible for the benefit under Notification No. 158/95, the importation should take place within three years from the date of original exportation, goods are re-exported within a maximum of twelve months from the date of re importation and when such re-exportation is not effected as per the conditions of the notification, the differential duty liability on account of availment of Notification No 158/95- Cus. at re-importation is liable to paid up by the importer. There is no ambiguity, whatsoever, in the Notification issued by the Central Government. The Notification stipulates to export the goods after repairs or reconditioning within the period as stipulated and pay, on demand, in the event of his failure to comply with any of the aforesaid conditions, an amount equal to the difference between the duty levied at the time of re-import and the duty leviable on such goods at the time of importation but for the exemption contained therein.
We have considered the contours of the decision of M/s. Indian Rayon and Industries [2008 (7) TMI 401 - SUPREME COURT] which while dealing with the Notification No. 158/95-Cus held that once the benefit of Notification No. 158/95-Cus is taken the conditions are required to be fulfilled of the same notification. However, it is also noted that Notification No. 158/95-Cus was the only notification available at the time of re-import for most of the period.
We, therefore, direct the learned Commissioner may consider the benefit of Notification No. 45/2017-Cus and 46/2017-Cus, for the period, when they were available, and if otherwise applicable. We also find that breach of notification 158/95-Cus under which re-import was done, was committed.
The interest and penal consequences therefore have to follow. However, if another beneficial notification to the appellant was available and they are eligible for the same, then as far as duty is concerned, they can legitimately take the benefit of the same. Any other beneficial notification can be claimed at any stage by the party.
With these directions, we remand the matter for re-consideration by the adjudicating authority in terms of above principles.
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2024 (2) TMI 1319
Liability of Custodian to pay demand duty - Goods lost from the custody of the custodian, CONCOR - customs seal missing and replaced by a red colour private seal with no number - Inland Container Depot [ICD] declaring the imported goods as “glass beads with holes”- mis-declaring the nature of goods - Imported goods were glass chatons - confiscation - imposition of penalty - violation of section 45 - HELD THAT:- It is true that after finding the discrepancies in the declaration on 24.11.2014 the officer of customs took time and seized them only by seizure memo dated 23.02.2015 u/s 110. He also sealed the container with container customs seal numbers 227393 and 227394. He handed over the goods along with sealed container to CONCOR on 24.02.2015. There is nothing on record to show that the customs officers had taken the goods out of the customs area. There is also nothing on record to show that anybody else was permitted to and had taken the goods from customs area. With reference to a letter dated 24.02.2015 the custodian found on 28.2.2015 that the container seal was broken and there was a private seal in red colour without any seal number. On opening, they found the goods were lost. Clearly, there is no scope of any interpretation in this chain of events except that the goods were pilfered while they were in the custody of the custodian CONCOR.
Therefore, we find that in terms of section 45 (3), the CONCOR had to pay customs duty. Since part of the duty was already paid by the importer only the differential duty was demanded from CONCOR in the impugned order. We, therefore, find infirmity in the impugned order in so far as the confirmation of demand of duty u/s 45 (iii) on CONCOR is concerned.
Imposition of penalty u/s 117 - Clearly, there is violation of section 45 by the CONCOR inasmuch as it had not taken proper care of the goods in its custody and as a result they were pilfered. The value of the goods which were pilfered is Rs. 5,93,25,481/-. Considering this amount, we find that penalty of Rs. 1 Lakh imposed on CONCOR u/s 117 is fair and reasonable and calls for no interference.
Penalty imposed u/s 112(a) and 114 AA - confiscation - In this case, the importer is not in the business of importing the glass beads or glass chatons and was indeed a regular importer of radiators for tractors. This consignment was different and the importer had provided samples of the goods to be imported to Shri Bhatt who was the Manager of Shri B S Mann. In turn, Shri Bhatt had shown those samples to Shri Mann. In this factual matrix we find no reason to believe that Shri Mann had innocently filed the Bill of Entry with a wrong declaration. Both Shri Mann and his Manager were fully aware of actual goods being imported and had filed Bills of Entry with the wrong description.
Therefore, the goods were correctly held to be liable for confiscation u/s 111 (l)and (n) of the Customs Act. However, before the goods could be confiscated they were pilfered after their seizure while in the custody of the CONCOR. The Commissioner had, therefore, not imposed any redemption fine. Penalty u/s 112 (a) can be imposed on any person who, in relation to a goods, does or omits to do any act which act or omission would render such goods liable to confiscation u/s 111, or abets the doing or omission of such an act. In this case, the glass chatons were imported and having seen the samples even after the import Shri B S Mann and through his employees filed a Bill of Entry for glass beads. In fact, 90% of the goods were glass chatons. We, therefore, find that Shri B S Mann was correctly held liable to penalty u/s 112(a).
The value of the goods in this case was Rs. 5,92,25,481/-. Shri B S Mann, through his employees, filed the Bill of Entry mis-declaring the nature of goods having first obtained samples of the goods even before filing the Bill of Entry. As is clear from the cross-examination by Shri B S Mann, Manager of Shri Bhatt that not only he but also Shri B S Mann, himself had seen the samples before filing the Bill of Entry. We, therefore, have no hesitation in finding that the Bill of Entry filed knowingly mis-declaring the nature of goods.
Thus, we find that the penalty u/s 114 AA imposed on Shri B S Mann needs to be sustained. Hence, we uphold the impugned order in so far as it pertains Shri B S Mann and reject his appeal.
All the three appeals are dismissed and the impugned order is upheld.
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2024 (2) TMI 1318
Classification of imported goods - rods or wires - Polycab-wires - Extended Period of limitation - Levy of penalty - HELD THAT:- It is apparent that the appellants have declared in their documents the fact that the goods were imported in the shape of coils. It has been recorded in the Order-In-Original as well reproduced in Counsel's arguments. The only reason for change of classification is the chapter note (d) and (f) of Chapter 74 of Custom Tariff.
Thus, it is clear that there was no suppression of any kind and in these circumstances, the invocation of a longer period of limitation cannot be justified. The notice is clearly barred by limitation - The appeal is consequently allowed.
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2024 (2) TMI 1317
Condonation of delay in filing the Appeal - Appellant submits that since certified copy which was sought has not been given, the Appellant could not file the appeal in time and delay in filing the Appeal need to be condoned - HELD THAT:- Jurisdiction to condone the delay is limited to only 15 days after expiry of the limitation under Section 61(2) proviso. Even from the own case of the Appellant, it is clear that for the first time the certified copy was applied on 23rd November, 2023 physically. The email was sent on 18th November, 2023 prayer of which we have quoted above cannot be treated to be an application for certified copy, according to own case of the Appellant, application for certified copy was made on 23.11.2023 after 30 days of passing of the order dated 19.10.2023 - no benefit under Section 12 of the limitation act can be allowed to the Appellant whereas admittedly according to the Appellant, the certified copy was not given.
The Appeal having been filed on 23rd January, 2024 which is well beyond time and well beyond period of 15 days which is permissible to be condoned under Section 61(2) proviso, the delay cannot be condoned in filing the Appeal - Delay Condonation Application is dismissed.
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2024 (2) TMI 1316
Initiation of CIRP - Personal Guarantors - Maintainability of Applications filed under Section 95 sub-section (1) of IBC - time limitation - It is submitted that Adjudicating Authority cannot be used as a Forum to recover a time barred debt - HELD THAT:- In view of the judgment of the Hon’ble Supreme Court in DILIP B JIWRAJKA VERSUS UNION OF INDIA & ORS. [2024 (1) TMI 33 - SUPREME COURT], it is settled now that question of adjudication of issues between the parties arises only at the stage of Section 100 and the RP has only role of facilitator. The RP has to submit a Report, after examining the Application under Section 95 and after giving opportunity to Personal Guarantor. The role of RP has been elaborately examined by the Hon’ble Supreme Court in the aforesaid case and it is held that RP does not perform any adjudicatory function, nor even can take an administrative decision. The role of RP has been held to be only facilitator. The judgment relied by learned Senior Counsel for the Appellant in SHANKARLAL AGGARWALA VERSUS SHANKARLAL PODDAR [1963 (1) TMI 40 - SUPREME COURT] has no application in the facts of the present case.
Insofar as the submission of the Appellant(s) that Adjudicating Authority failed to take into consideration that authorization was not filed by the RP, it is always open for the Appellant to take such or other pleas as permissible at the time of adjudication of issue, including any defect in the Application under Section 95 and the said question also does not require any consideration at the stage when RP is appointed. Of course, if there is any invalidity or shortcomings while appointing the RP, Section 98 is there for the debtor or creditor, which provides for replacement of the RP.
There is no error in the impugned order passed by the Adjudicating Authority appointing the RP - There is no merit in these Appeal(s) - The Appeal(s) are dismissed.
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2024 (2) TMI 1315
Initiation of CIRP - Admission of main company petition - liability of Guarantor of loan - acknowledgment of debt by the Principal Borrower shall be binding on the Guarantor or not - plea of the Appellant is that the ‘action’ as far as the Corporate Guarantor is concerned, the same is barred by Limitation and that Article 137 of Limitation Act 1963 applies - HELD THAT:- As per the decision of Hon’ble Supreme Court in Laxmi Pat Surana’s case [2021 (3) TMI 1179 - SUPREME COURT], the liability of the Guarantor being co-extensive with the Principal Borrower under Section 128 of the Indian Contract Act, 1872 it triggers the moment the Principal Borrower commits default in paying the acknowledge debt and this being a legal fiction and such a ‘liability of the guarantor will flow from the Guarantee Deed and Memorandum of Mortgage created therein’.
On a careful consideration of respective contentions, this ‘Tribunal’, taking note of the facts and circumstances of the instant case in an encircling manner, and ongoing through the impugned order passed by the Adjudicating Authority/NCLT Kochi Bench, comes to a resultant conclusion that the conclusion arrived at by the Adjudicating Authority/Tribunal in admitting main petition holding that the debt has not been paid by the ‘Corporate Guarantor’ is free from any legal flaws.
Application dismissed.
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2024 (2) TMI 1314
Improper handling of Resolution Plan - Respondent No.1 alleges that the Resolution Professional (RP) violated the process by opening a sealed cover containing the plan without the presence of the Committee of Creditors (CoC) and Principal Resolution Applicants (PRAs). - HELD THAT:- Regulation 39 of the CIRP Regulations, 2016 also requires the Resolution Professional to look into the Resolution Plan submitted by the Applicants and to place the plan before CoC which is in compliance with Section 30(2). The opening of Resolution Plan by Resolution Professional is essential for further process in the CIRP. The Resolution Professional without opening the plan cannot come to any opinion whether the plan is complaint to Section 30(2) or not. There is no regulation or law which provide that the Resolution Professional should open the plan in presence of CoC and PRAs. Learned counsel for the Respondent No.1 has been unable to show any provision of law which require that the Resolution Professional shall open the plan in presence of CoC and PRAs.
The order passed by the Adjudicating Authority is unsustainable - In result, Appeal is allowed.
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2024 (2) TMI 1313
Maintainability of petition - availability of alternative remedy - petitioners are willing to avail of the said remedy - HELD THAT:- These special leave petitions disposed off reserving liberty to the petitioners herein to file the statutory appeal within a period of one month from today. If such an appeal is filed within the aforesaid time frame, the Tribunal shall not raise the issue of limitation in filing the said appeal.
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2024 (2) TMI 1312
Circular issued by the Central Board of Indirect Taxes and Customs not considered by Respondent No.3 in passing the impugned order - HELD THAT:- Stand over to 20th February 2024 to enable Respondents to place on record reply affidavit. Let a copy of the reply affidavit be served on the learned Advocate for the Petitioner well in advance. Till the next date of hearing, impugned order shall remain stayed.
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9911796707
