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Showing 221 to 240 of 2056 Records
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2019 (7) TMI 1837
Interference with the import of the commodity based on subsequent notifications - HELD THAT:- Issue notice on writ as well as stay application, returnable within four weeks. Learned counsel for the petitioner would deposit process fee and take out notice for service on respondents.
In the meanwhile and till the next date, effect and operation of the impugned notification dated 28th December, 2018 (Annexure-9) and 29th March, 2019 (Annexure-19) and subsequent trade notice dated 16th April, 2019 (Annexure-20), shall remain stayed.
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2019 (7) TMI 1836
Dishonor of Cheque - cheque was returned - case of petitioner is that the cheque has been returned by the bank by requesting the respondent to contact the Drawer - Drawee Bank and present it again - HELD THAT:- In the facts of the present case, the concerned bank has not returned the cheque on the ground of defect. It has been returned by directing the respondent to contact a concerned bank and present it again. In short, this endorsement cannot be held to be dishonour of cheque. In the considered view of this Court, the respondent without complying with the requirements of the bank, ought not to have proceeded to file a complaint under Section 138 of the Negotiable Instruments Act. The Court below went wrong in taking cognizance of the complaint.
Petition allowed - decided in favor of petitioner.
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2019 (7) TMI 1835
Depreciation on crawler cranes/trailers - Whether the crawler cranes/trailers are in the nature of Plant & Machinery and thus eligible for depreciation @15% and not eligible for higher depreciation of 30%? - HELD THAT:- As relying on own case [2017 (12) TMI 644 - ITAT MUMBAI] we do not find any merit in action of lower authorities for declining higher claim of depreciation at 30% on Crawler Cranes and Dozers - Decided against revenue.
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2019 (7) TMI 1834
Refund of GST - Refund rejected on the ground that assessee had not debited the same amounts and shown it in the respective ST-3 returns - violation of paragraph 2 (h) of N/N. 27/2012-C.E.(N.T.) : dated 18.06.2012 - period January 2017 to March 2017 - period April 2017 to June 2017 - HELD THAT:- An identical issue with regard to the alleged violation to paragraph 2 (h) of the Notification No. 27/2012 : (supra) vis-à-vis the claim of refund, has been considered by this Bench of the Tribunal in the case of M/S. GLOBAL ANALYTICS INDIA PVT. LTD. VERSUS THE COMMISSIONER OF G.S.T. & CENTRAL EXCISE [2019 (7) TMI 1185 - CESTAT CHENNAI] wherein, after considering the various contentions, it has been held the appellant did not reverse the equal amount as required by the condition at paragraph 2(h) of Notification No. 27/2012. But the fact also remains that there was no provision in the ACES system to debit the value of refund and also the fact that the entire credit which was carried forward in TRAN-1 stood reversed by the appellant voluntarily in its GSTR-3B filed for the month of April 2018. These are sufficient compliances with the condition at paragraph 2(h) since post G.S.T., the scenario is different than the one prevailing prior to G.S.T. regime. Otherwise, it would become an impossible task for an assessee, more so when the filing of ST-3 returns itself was done away with.
The denial of refund is not in accordance with law - Appeal allowed - decided in favor of appellant.
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2019 (7) TMI 1833
Operation and effect of notification dated 29.03.2019 - HELD THAT:- Issue notice to respondents, returnable by three weeks.
In the meanwhile, operation and effect of notification dated 29.03.2019 (Annexure-15) and subsequent trade notice dated 16.04.2019 (Annexure-16), shall remain stayed qua the petitioner.
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2019 (7) TMI 1832
Reactivation of Director Identification Number (DIN) of the petitioner and the digital signature certificate - HELD THAT:- The respondents are directed to reactivate the Director Identification Number (DIN) of the petitioner and the digital signature certificate to enable the petitioner to act in the capacity of Director and file the necessary annual returns so also to discharge statutory obligations of all other companies, wherein the petitioners are director.
List this matter after six weeks along with D.B. Civil Writ Petition No. 7146/2019.
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2019 (7) TMI 1831
Levy of Service Tax - Intellectual Property Services - constitutionality of Sections 65(55b) and 65(105)(zzr) of the Finance Act, 1994 - HELD THAT:- Division Bench sitting in the Principal Seat of this Court, in M/S. AGS ENTERTAINMENT PRIVATE LIMITED AND OTHERS VERSUS UNION OF INDIA AND OTHERS [2013 (7) TMI 23 - MADRAS HIGH COURT] has upheld the constitutionality of the levy - the interim injunction granted by the learned single Judge on 08.06.2011 would have no force as on date.
The petitioner will appear before the respondent on 01.08.2019 in response to summons dated 14.09.2013. Upon hearing the petitioner, the Assessing Authority shall finalize the proceedings in accordance with law and in compliance with the principles of natural justice - Petition dismissed.
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2019 (7) TMI 1830
Refund of Input Tax Credit - Zero rated sales - refund rejected on the ground that Form-W was filed beyond the statutory period of 180 days - whether the prescription of 180 days is to be mandatorily applied or is only directory? - HELD THAT:- The comprehensive monthly returns filed by the petitioner admittedly contains inter alia, all particulars in relation to the zero rated transactions. The format of monthly returns in Form-I contains Annexure-4 wherein the petitioner has to set out details of the transaction of zero rated sales. This will be available on monthly basis before the Assessing Authority and as such, the requirement to file Form-W is only to be for the convenience of the authority to receive the particulars of the claim by way of a consolidated statement.
The decision in the case of SARA LEATHERS VERSUS COMMERCIAL TAX OFFICER, TAMBARAM I ASSESSMENT CIRCLE, CHENNAI [2009 (10) TMI 848 - MADRAS HIGH COURT] where the Court considered the disallowance of the claim of the petitioner for refund of tax paid by it at 12.5 % as against 4.5% chargeable notwithstanding there was a dispute raised in the assessment thereof. The Court held that such dispute would not stand in the way of the refund sought.
The petitioner is permitted to seek refund/adjustment of the amount of credit which shall be considered by the Assessing Authority after hearing it within a period of two weeks from date of receipt of such request - petition allowed - decided in favor of petitioner.
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2019 (7) TMI 1829
Delay in e-filing of the appeal - Non filing of appeal electronically - Non comply with Rule 45 of the IT Rules - HELD THAT:- It is an admitted fact that against the assessment order, the assessee filed a manual appeal on 21.04.2016, which is well within the time provided under the Act. Since the assessee did not comply with Rule 45 of the IT Rules, a show-cause dated 13.12.2018 was sent to the assessee to explain the cause for noncompliance with the aforesaid Rule. In compliance to the notice the assessee filed the appeal electronically on 26.12.2018. Since there was a delay in e-filing from the extended due date of e-filing i.e., 15.06.2016 and no petition to condone the delay has been filed by the assessee, the ld. CIT(A) dismissed the appeal without adjudicating the issue on merits.
On similar facts and circumstances in an identical issue, the Mumbai Benches of this Tribunal in the case of All India Federation of Tax Practitioners [2018 (6) TMI 1171 - ITAT MUMBAI] as also the decision of the Delhi Benches of the Tribunal in the case of Shri Gurinder Singh Dhillon [2017 (4) TMI 1359 - ITAT DELHI] had held that the delay was liable to be condoned.
In this case, we find that the delay was on account of the venial breach and as the assessee had filed the manual appeal within the time. Thus, respectfully following the principles laid down in the case of State of Punjab v. Shyamalal Murari & Others[1975 (10) TMI 105 - SUPREME COURT], the delay in e-filing of the appeal is condoned and the issues in this appeal are restored to the file of the ld. CIT(A) for adjudication on merits in accordance with law by allowing an opportunity of being heard to the assessee.
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2019 (7) TMI 1828
Assessment u/s.153A - HELD THAT:- Following the principles laid down by the Hon’ble Supreme Court in the case MEETA GUTGUTIA [2018 (7) TMI 569 - SC ORDER] as no incriminating material has been found in the course of search in the case of the assessee for the assessment years under appeal, the addition as made by the AO is unsustainable. Consequently, the findings of the Ld.CIT(A) on this issue stands confirmed. Appeals filed by the Revenue are dismissed.
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2019 (7) TMI 1827
TP Adjustment - value of international transaction of export of finished goods and not considering the comparability analysis - HELD THAT:- The set ‘principle of consistency’ was ignored by the authorities. After rejecting the said segmental results, the Assessing Officer/TPO/DRP was adopted the entity level PLI which means inclusion of the domestic sales also for the purpose of PLI workings. This approach of the AO/TPO/DRP was contested before us and various arguments were made to substantiate the claim of the assessee. The assessee filed a written note on this issue. In the said note, the assessee submitted that the revenue consistently accepted the export segment results since the assessment years 2007-08 to 2010-11.
Before the TPO/ AO, the assessee furnished details of Profit and Loss Account based on the books of account maintained by the assessee. Relying on the DRP’s direction given in favour of the Revenue, assessee argued that the same constitutes violation of the principle of consistency. Highlighting this principle, ld. Counsel submitted that there is a finding of fact from this Tribunal for the assessment year 2007-08 in favour of upholding the AEs segment results and the same is not in favour of the entity level results of the assessee. It is a fact that the TPO himself rejected the entity level margins and computed the PLI for the assessment years 2010-11 and 2011-12. On hearing the assessee on one side and the arguments of the ld. DR for the Revenue, who relied on the order of the Assessing Officer/TPO/DRP, we are of the opinion, the violation caused to the “principle of consistency” is not proper. Therefore, we are of the opinion the same should be allowed in favour of the assessee.
Segmental profits relates to the PLI of the export sales of RTS food - correctness of the segmental profits and the PLI of the export sales of RTS food - HELD THAT:- As assessee maintained books of account for both the segments separately. The apportionment of expenses is an integral part of the said limb. While allocating the certain common expenses, the assessee relied on profit to sale basis, which is an approved method of allocation of the common expenses between the segments. No sustainable reason is mentioned as to why such a basis is unsustainable. The certificate issued by the Cost Accountant and the basis adopted for allocation of expenses is not an unusual basis. The ld. DR could not file any evidence or case law to defend his stand. We find the segmental results supplied by the assessee deserve to be accepted. The assessee relied on various decisions in support of the apportionment of common expenses.
Provision for operational expenses - Treatment to these additions in matters of PLI calculations - HELD THAT:- Disallowance is confirmed, the income of the assessee stands increased to that extent and such increased income constitutes an operating profit of the assessee and the same should be considered for the purpose of calculating the PLI of the assessee. In case, the same is allowed, the same constitutes operating cost. We shall now take up the merits of disallowance and the same is justified on merits.
Disallowance of Bad Debts - assessee continues to have considered in transactions with the said debtor - HELD THAT:- There is no dispute on the fact the amounts were written off in the books of the assessee. The assessee relied heavily on the judgement in the case of TRF Ltd. [2010 (2) TMI 211 - SUPREME COURT]. DRP confirmed the said disallowance. On hearing both the sides on this issue, we find that the claim of the assessee is proper. We find no violation by the assessee in claiming the said bad debts. The assessee has strength of the said Apex Court’s judgement in the case of TRF Ltd. (supra). We accordingly allow the claim of bad debts in favour of the assessee.
Provision for operating expenses - assessee failed to establish the correctness of the said provision and the criteria for arriving at such sum as a provision towards the operating expenses - HELD THAT:- For want of evidences, DRP confirmed the decision of the Assessing Officer in making such disallowances. Before us, assessee relied heavily on the claim in the books of account. However, ld. Counsel could not demonstrate the criteria for arriving at such an amount as a provision and utilization of the same in the year under consideration. On hearing both the sides and considering the assessee’s failure to discharge the onus, we proceed to confirm the disallowance made by the Assessing Officer. Accordingly, on merits, the addition on account of provision is confirmed.
Effect of such disallowances in matters relating to the calculation of PLI qua the operating income and operating expenses - HELD THAT:- AO is directed to consider the bad debts claim is an operational cost and calculate the PLI of the assessee as per the procedure. Regarding the operating expenses it is our finding that the claim of the assessee is not allowable considering the failure of the assessee in discharging the onus by furnishing the evidences and the criteria for quantifying such amount. The effect of the said decision is going to increase the income of the assessee. Thereby, the operating income stands increased by the said sum - Assessing Officer is directed to consider the same as operating income while calculating the PLI of the assessee.
Treatment to be given to the export incentives - case of the assessee is that the same constitutes an operational income and the same claim was accepted by the authorities in many assessment years in the past - HELD THAT:- Considering the principle of consistency, we are of the opinion the assessee’s claim should be allowed in his favour.Accordingly, the export incentive needs to be included in the operational income for PLI computation. Thus, the said issue raised in ground no.3 is allowed in favour of the assessee.
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2019 (7) TMI 1826
TP adjustments qua the payment of management services fee - CIT-A deleted the addition - HELD THAT:- Tribunal relied heavily on the earlier orders of the Tribunal in assessee’s own case for the assessment years 2009-10 to 2011-12. Considering the commonness of the issue, we find it relevant to follow the order of the Tribunal in assessee’s own case for the assessment year 2012-13 [2018 (12) TMI 691 - ITAT PUNE] and confirm the order of the CIT(A). Accordingly, the relevant grounds on this issue raised by the Revenue are dismissed.
Allowability of the “warranty provision” - HELD THAT:-The issue raised in the present appeal is similar where the assessee is following systematic manner of creating provision for warranty and there is no change in factual aspects, hence, we find no merit in the orders of authorities below in not allowing the claim of assessee. Accordingly, we direct the Assessing Officer to delete the addition as relying the order of the Tribunal in assessee’s own case for the assessment year 2012-13 [2018 (12) TMI 691 - ITAT PUNE]
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2019 (7) TMI 1825
Exemption u/s 11 denied - charitable activities u/s 2(15) - action of the AO in holding the activities of promoting the game of cricket as business income u/s. 28 - receipts on account of sale of tickets, sponsorship income - HELD THAT:- Whatever we decide in the case of Gujarat Cricket Association [2019 (1) TMI 1522 - ITAT AHMEDABAD] the same will equally apply in this case as well. We, therefore, uphold the plea of the assessee and allow these grounds of appeal to that extent in principle. There is, however, a rider. In this case, there is also a reference to the assessee organizing a one day international match, on commercial scale, for fund raising. That issue is dealt with in a separate ground of appeal. In case, it is held that the said one day international match is in the nature of commercial adventure, it will have the impact on section 2(15) being invoked.
That ground is separately being remitted to the file of the CIT(A) for fresh adjudication, and the eventual decision on the same will also have the impact on these issues. We, therefore, remit the matter to the file of the CITI(A) for fresh adjudication in the light of our observations in the case of Gujarat Cricket Association (supra) and the findings on the said aspect of the matter.
Withdrawing exemption u/s 11(1)(d) as sum received in the form of Corpus donation - TV subsidies receipts - HELD THAT:- There is no dispute that the TV subsidy in question is sent under this resolution. On these facts, and in the light of the provisions of Section 11(1)(d) which only require the income to be “by way of voluntary contributions made with a specific direction that they shall form part of the corpus of the trust or the institution”, we are of the considered view that any payments made by the BCCI, without a legal obligation and with a specific direction that it shall be for corpus fund- as admittedly the present receipt is, is required to be treated as corpus donation not includible in total income. We are unable to find any legal support for learned CIT(A)’s stand that each donation must be accompanied by a separate written document. The contribution has to be voluntary and it has to be with specific direction that it will form corpus of the trust’. These conditions are clearly satisfied. Any payment which the assessee is not under an obligation to make, whatever be the mode of its computation, is a voluntary payment, and, any payment which is with a specific direction that it for corpus fund is a corpus donation. In our considered view, even without the two specific confirmations filed by the assessee, in the light of the BCCI resolution under which the payment is made and in the light of the payment not being under any legal obligation, the conditions under section 11(1)(d) are satisfied. We, therefore, uphold the plea of the assessee. The Assessing Officer is accordingly directed to delete this addition
Corpus donation in form of Infrastructure Subsidy- As long as the subsidy is relatable to a capital asset created by the assessee on his own or by an eligible district cricket association, as the present subsidy undisputedly is, it is outside the ambit of revenue receipt and taxable income. The very foundation of the stand of the Assessing Officer is thus devoid of legally sustainable merits. As such, there can hardly be an occasion, in principle, to hold such a subsidy as a revenue receipt or taxable income. There is not even a whisper of a discussion by the Assessing Officer to the effect that infrastructure subsidy is revenue in nature. As a matter of fact, the claim is made for the subsidy only after the expenditure having been incurred. The authorities below have simply brushed aside the case and the submissions of the assessee and proceeded to hold it as an income. Looking to the nature of the subsidy, which is clearly relatable to the capital assets generated, we are unable to hold this receipt in the revenue field. We, therefore, uphold the plea of the assessee on this point as well and delete the addition.
Income from hosting of One Day International match ("ODI") - We find that though there are findings to the above effect in the order of the Assessing Officer, the CIT(A) has dealt with the same in a very causal manner and without specific and categorical discussions on the same. We, therefore, deem it fit and proper to remit the matter to the file of the CIT(A) on this issue. We order so. As we do so, and for the detailed reasons set out earlier while dealing with Gujarat Cricket Associations case [2019 (1) TMI 1522 - ITAT AHMEDABAD] we make it clear that it is only in the event of this event being organized by the appellant cricket association on its own, rather than under arrangements and planning by the BCCI, that this could be put against the assessee as an adventure in the nature of trade, commerce or business. Thus we allow the appeal of the assessee.
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2019 (7) TMI 1824
Reopening of assessment u/s 147 - disallowance u/s 14A - HELD THAT:- CIT(A) has clearly held that no disallowance is permissible in this case u/s. 14A on the touchstone of Hon'ble Jurisdictional High Court decision in the case of Jet Airways Ltd. [2010 (4) TMI 431 - HIGH COURT OF BOMBAY] in as much as no disallowance has been done on the issue on which reopening has been done. As a matter of fact, he Revenue is not in appeal against this order of learned CIT(A). Thus we hold that learned CIT(A) has erred in upholding part of the disallowance u/s. 14A, when he held at the threshold that no disallowance u/s. 14A is permissible in as much as no disallowance was done on the issue on which reopening was made. Accordingly, I set aside the order of learned CIT(A) and delete the disallowance.
Computation of deduction u/s 14A - HELD THAT:- Hon'ble Apex Court in the case of Maxopp Investment [2018 (3) TMI 805 - SUPREME COURT] has upheld Hon'ble Punjab & Haryana High Court decision in the case of PCIT vs. State Bank of Patiala [2017 (2) TMI 125 - PUNJAB AND HARYANA HIGH COURT] wherein restriction of disallowance u/s. 14A to the extent of exempt income earned has been upheld. Hence, it is now settled that no disallowance can be done over and above exempt income earned. Now in this case, it is the submission of learned Counsel of the assessee that the assessee has not earned any exempt income in as much as dividend income of ₹ 14,077/- has been offered to tax, hence, no disallowance u/s. 14A is permissible.
Thus find in agreement with the above said proposition - Assessing Officer requires to examine this aspect that the assessee has not shown any exempt income and whatever dividend income has been earned has been offered to tax. If above is found factually correct, no disallowance u/s. 14A is sustainable. Hence, this issue allowed for statistical purposes.
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2019 (7) TMI 1823
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Debt or not - date on which there should be relation between the two parties for the alleged financial creditor - related party or not - existence of debt and dispute or not - HELD THAT:- The transactions between the CD and both Spade and AAA Landmark are collusive in nature and do not qualify as financial debt for the purposes of the IBC. Accordingly, Spade and AAA Landmarks do not qualify to be considered as financial creditors.
The affairs of the CD as well as the group of Arun Anand companies are deeply entangled and it is difficult for the Tribunal in a summary jurisdiction to unravel the same. Considering that the CD and Spade and AAA were in close business relationship in the past and also the fact that the accounts of the CD have not been finalized and audited and filed with the Registrar of Companies since 2016, the instant applications filed by Yes Bank Ltd., and Phoenix ARC P. Ltd. are allowed - application allowed.
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2019 (7) TMI 1822
Partial award made under Section 16 of the Arbitration Act - Section 16 (6) of the Arbitration Act - HELD THAT:- Such an application was not tenable vide Section 16 (6) of the Arbitration Act. Since such an application was not tenable, we fail to understand how in a writ petition filed against an order made by the District Judge in an untenable application, the High Court could have set aside the partial award. This is clearly contrary to law.
This court in the case of SBP & Co. vs. Patel Engineering Ltd. & Anr [2005 (10) TMI 495 - SUPREME COURT], where it was held that We, therefore, disapprove of the stand adopted by some of the High Courts that any order passed by the arbitral tribunal is capable of being corrected by the High Court under Article 226 or 227 of the Constitution of India.
The judgment of the High Court is liable to be set aside - Appeal disposed off.
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2019 (7) TMI 1821
Dishonor of Cheque - failure to repay despite receipt of legal Notice - acquittal of the accused - rebuttal of presumption - HELD THAT:- It transpires that an amount of ' 4,00,000/- was paid by the complainant to the accused and it was duly acknowledged by the accused by executing Exhibit 19. From the evidence of the appellant/complainant and of Pw2 Dinesh it has been established that the Cheque Exhibit 16 was dishonoured for want of sufficient funds in the account of the respondent/accused as well as the fact of payment of a lump sum amount of ' 4,00,000/- to the complainant.
This would lead to a presumption under Sec. 139 of the Negotiable Instruments Act, in favour of the appellant/complainant. On the aspect of presumption under Section 139 of the Negotiable Instruments Act, and on the point of unaccounted money - The Apex Court [2009 (2) TMI 901 - BOMBAY HIGH COURT] specifically held that section 139 merely raises a presumption in favour of holder of cheque that the same has been issued for discharge of any debt or liability. Thus, even if presumption is not rebutted, Act, in order to attract section 138 of the debt has to be a "legally enforceable debt" as said is clear from the explanation to section 138 which provides that for the purposes of the said section the debt or other liability means a legally enforceable debt or other liability.
Though it is observed in para 15 that the same rule with the same rigor cannot be applied in a matter relating to the offences under Sec. 138 of the Negotiable Instruments Act, particularly where a presumption is drawn that the holder has received a cheque for the discharge, wholly or in part, of any debt or liability. However, it is further observed that the accused is entitled to bring on record the relevant material to rebut the presumption and to show that preponderance of probabilities are in favour of his defence then the Appellate Court is certainly entitled to examine the evidence in order to find out if preponderance indeed leans in favour of the accused - In the case at hand, the respondent/accused has succeeded in bringing on record probable defences and has rebutted the presumption; the complainant has not further discharged his burden to indicate that the transaction in question was a legally enforceable debt. It is therefore, needless to take any different view other than the one taken by the Learned J.M.F.C., in the impugned Judgment while acquitting the respondent/accused.
Appeal dismissed.
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2019 (7) TMI 1820
Validity of Suo-motu duty adjustment of excess duty paid - month of March 2013 - whether demand of central excise duty is sustainable for the period May 2013 inasmuch as duty liability has been paid by way of suo-moto adjustment of said excess duty payment in the month of March 2013? - time limitation - HELD THAT:- The case of the appellant can be decided on the ground of limitation alone inasmuch as the period in dispute is May 2013 for which the SCN has been issued in February 2017 by invoking extended period of limitation. The fact regarding the adjustment of excess duty was always in the knowledge of the department in view of the reason that adequate disclosures were duly made in the ER-1 returns field with the department. It cannot be said that there was any suppression on the part of the assessee.
Further, on perusal of the entire Show Cause Notice, except the mere allegation of suppression to invoke extended period of limitation, there are no specific charge against the assessee for willful suppression of any information from the Department.
Appeal allowed - decided in favor of appellant.
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2019 (7) TMI 1819
Wrongful availment of exemption N/N. 3/204-CE dated 08.01.2004 - non-nclusion of element of cost of transportation including average freight - inclusion of Irrecoverable taxes on average/equalized basis - HELD THAT:- The appellant inter alia manufactured and cleared paints and varnishes classifiable under chapter 32 to M/s.Driplex Water Engineering Limited without payment of duty and claiming exemption under Notification No.3/2004-CE dated 08.01.2004. In order to claim such exemption, the appellant was required to furnish a certificate issued by the Collector/Deputy Commissioner/Dist.Magistrate of the district in charge of the project to the effect that the goods were cleared for the purposes specified in the said notification. It is the case of the appellant that the fact of exemption was duly disclosed in Form ER-1 returns and hence there was no suppression or willful misstatement on the part of the appellant. Further the exemption was availed on the strength of a certificate issued by the District Collector duly approved by the state Government - the appellant availed the benefit of the said notification with mala fide intention of evasion of payment of duty by resorting to suppression of facts or willful misstatement is not sustainable.
It is at most a case of mistake in the proper and strict interpretation of an exemption notification and definitely not a case of fraudulent availment of notification by resorting to suppression of facts, willful misstatement, commissioning of fraud with mala fide motive of evasion of duty - there are no ingredient of misstatement, suppression of facts, with intent to evade payment of duty. Accordingly the penalty imposed cannot be sustained and the same is set aside.
Appeal allowed - decided in favor of appellant.
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2019 (7) TMI 1818
Admission of claim of the Applicant as mentioned in FORM-C - reconstitution of Committee of Creditors - Jurisdiction of Authorized Representative/ Power Agent to argue on behalf of the Applicant - non-filing of the income tax return by the Applicant - re-payment of the loan advanced - non-compliance with FED master direction No. 6/2015-16 dated January I, 2016 issued by the Reserve Bank of India - absence of entry in the Books of Account of the Corporate Debtor.
Whether the Authorized Representative/ Power Agent is legally entitled to argue on behalf of the Applicant? - HELD THAT:- On co-joint reading of the provisions of Section 432 of the Companies Act, 2013 and Rule 45 of the National Company Law Tribunal, Rules 2016 r/ w. , Section 32 of the Advocate Act, 1961 there does not appear any bar against the Authorized Representative/ Power Agent to argue the case of the Applicant/ Principal. The Authorized Representative/ Power Agent is duly authorized in writing in this behalf by the Applicant / principal and he has knowledge of law and already argued his personal cases well before this bench - this Authority has permitted the Authorized Representative/Power Agent viz., Mr. Gagan Bothra to argue the case of the Applicant/ principal. Accordingly, the issue No. i, is decided in favour of the Applicant against the Respondent.
Whether the non-filing of the income tax return by the Applicant disentitles him to claim the re-payment of the loan advanced? - HELD THAT:- The Corporate Debtor after availing the loan, cannot take the plea that the Applicant has not produced any income tax return to demonstrate the source of loan. In this connection this authority also relies upon on the judgment given by Hon ble High Court of Madhya Pradesh, delivered on 07.03.2019 in SHRIMATI RAGINI GUPTA VERSUS PIYUSH DUTT SHARMA [2019 (4) TMI 114 - MADHYA PRADESH HIGH COURT]. In the light Of the above, the plea taken by the Corporate Debtor stands rejected and the issue is decided in favour of the Applicant.
Whether the non-compliance with FED master direction No. 6/2015-16 dated January I, 2016 issued by the Reserve Bank of India annuls the loan transactions between the Applicant and Corporate Debtor? - HELD THAT:- There is no violation of the Foreign Exchange Management Act, 1999 read with Foreign Exchange Management (borrowing and lending in Rupees) Regulations, 2000 notified vide notification no. FEMA 4/2000-RB dated May 3, 2000, and the FED Master Direction No. 6/2015-16 dated 01.01.2016 as is contended by learned Sr. counsel for the Resolution Professional/ Corporate Debtor. Even if, it is assumed that there is violation of said direction, the transactions do not become void, the non- compliance with the direction will entail penalty, if any. It is important to note that the loan transactions took place between the Applicant and the Corporate Debtor with effect from 05.03.2014 to 21.02.2017 and the Corporate Debtor had never raised any issue of such violation with the Applicant. Further, it is necessary to place on record that the Corporate Debtor has not pleaded anything in its counter with regard to the violation of the Foreign Exchange Management Act. In view of the discussion made, the cash transactions between the Applicant and the Corporate Debtor do not involve any violation of FED master direction No. 6/2015-16 dated January 1, 2016 issued by the Reserve Bank of India - the issue stands decided in favour of Applicant and against the Respondent.
Whether the claim of the Applicant based on acknowledgment/ confirmation letter and pro-note, both dated 21.02.2017 and cheque dated 12.06.2017 is admissible in the absence of entry in the Books of Account of the Corporate Debtor? - HELD THAT:- The Corporate Debtor has not been maintaining the accounts properly, for which the Applicant cannot be made liable, as the same pertains to the internal management of the Respondent/ Corporate Debtor. Therefore, the absence of any entry in the Books of Account of the Corporate Debtor, about the loan taken from the Applicant, cannot be a valid ground for rejection of the claim of the Applicant, in the face of the bulk of the documentary evidence, i.e., loan confirmation letter, pro- note and Cheque including Cash Book produced by the Applicant, to substantiate his claim - all the directors of the Board had consented to the borrowings of the loan from the Applicant and the loan confirmation letter has been signed by the managing director viz., Senthil kumar, having affixed the seal of the Corporate Debtor that leaves no doubt, that he (the director) has due authority to represent the Corporate Debtor. Therefore, the plea raised by the Corporate Debtor with regard to the Board resolution for obtaining loan from the Applicant is misdirected, the same stands rejected.
This authority takes judicial notice that during the pendency of this Application, the Resolution Plan came to be approved by the COC, which has been filed before this Authority under Section 30(6) read with Section 31(1) of the IBC, 2016. In view of this order, the Resolution Professional is directed as follows:-
a). to treat the Applicant at par with other unsecured financial creditors and make the appropriate provision for payment to which he is entitled, in consultation with the COC and the Resolution Applicant, and file the supplementary affidavit to that effect before this authority, or
b). to withdraw the Resolution Plan and constitute the COC afresh to get the Resolution Plan(s) approved with suitable modifications, as may be required.
Application disposed off.
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9911796707
