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Case Laws
Showing 241 to 260 of 1967 Records
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2014 (1) TMI 1729
Validity of speaking order passed within the statutory period - Self assessment was disputed by the Assessing Officer under sub-section 4 of Section 17 of the Customs Act, 1962 - Reassessment made disputing the correctness of the self assessment by the Assessing Officer but did not pass any speaking order - Held that:- the only exception which is carved out in the said sub-section is that the authority is not obliged to pass speaking order if the importer or the exporter confirms his acceptance of the said reassessment in writing. Submission of the petitioner that if the reassessed duty has been deposited by the importer or the exporter that implies the acceptance of the said order and therefore, the Assessing Officer is not under any obligation to pass speaking order cannot be accepted for a simple reason that the legislature was conscious of such situation and incorporated the word “in writing”. Such confirmation relating to an acceptance must be “in writing” and cannot be obliterated because of the conduct of the exporter or the importer having chosen to deposit the reassessed duty. Any other interpretation would frustrate the intent and / or the object of the legislature incorporating the words within the statutes. It is to be reminded that the legislature never used any words unnecessarily and, therefore, if there was a conscious intentment to incorporate the words “in writing” for confirmation of the acceptance of the reassessment, the same is to be followed in its true spirit. If the thing is required to be followed in a particular manner, it is to be done in such a manner and not otherwise. The Assessing Officer cannot sit idle and decline to discharge the statutory duty as provided in sub- Section 5 of Section 17 of the Customs Act 1962. Therefore, the authority shall be free to pass speaking order without being influenced by any observation. - Petition disposed of
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2014 (1) TMI 1728
Applicability of provisions of Section 43D to the assessee Society being a non-scheduled bank - CIT(A) allowed the claim - Held that:- We are not inclined to interfere in the findings of CIT(A) who has held that the provisions of section 43D were applicable to assessee’s society being non scheduled bank by following the decision of Osmanabad Janta Sahakari Bank Ltd.[2015 (3) TMI 886 - ITAT PUNE] Further, the CIT(A) was justified in holding that the interest income directly credited to the balance sheet was not real income. Accordingly, the order of CIT(A) is upheld. - Decided against revenue
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2014 (1) TMI 1727
Interest received on enhanced amount of compensation in respect of acquired land for delayed payment - Held that:- Source from receipt of enhanced compensation and interest received thereon was discussed in Sarti vs. Haryana State Industrial & Infrastructure Development Corporation Limited and others [2011 (5) TMI 939 - PUNJAB AND HARYANA HIGH COURT ] wherein it was observed that interest received on enhanced amount of compensation in respect of acquired land for delayed payment falls for taxation under Section 56 of the Act as “income from other sources” and is exigible to tax in the year of receipt under cash system of accountancy. It had also been observed that where the assessee is not maintaining books of accounts by adopting any specific method, it shall be treated to be cash system of accountancy. In the present case, the interest received by the petitioner was on account of delay in making the payment of enhanced compensation. Such payment could not par-take the character of compensation for acquisition of agricultural land and, thus, was not exempt under the Act. Once that was so, the tax at source had been rightly deducted by the payer - Decided against assessee
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2014 (1) TMI 1726
Determination of the annual letting value - Commission of brokerage paid to the Property Dealers - whether not allowable as a deduction against the rental income and the assessee is to be taxed on the total rental income received without any such deduction? - Held that:- there is no express provision allowing any expenditure, brokerage or commission to be deducted in determining the annual letting value. A formula has been enshrined in Section 23 and a combined reading of clauses (a) and (b) would lead to an inference about the words used i.e. “actual rent received or receivable”. Thereafter deduction is allowed under Section 24 of the Act. The statute does not empower the assessing authority or the assessee to add anything to the provisions where the words used in the statute are plain, precise and unambiguous. Neither Section 23 nor Section 24, which are exhaustive, provides for the deduction of the commission paid to the broker or the agent while letting out the property. Furthermore, the learned counsel for the appellant was unable to demonstrate as to how any aid could be derived from Explanation 1(a) to Section 23(1) of the Act. Any expense by way of brokerage or commission paid by owner to the broker in such circumstances cannot be reduced to determine annual rent received or receivable by the landlord. Once this is so, equally the plea of amount of brokerage paid to have overriding title over rent cannot be accepted.
We are, not inclined to concur with the analogy on which the assessee has set up its case, especially when a particular type of expenditure is not specifically provided to be deductible, deduction cannot be claimed from it. We find no ground to differ with the view taken by the Tribunal while upholding the order of Assessing Authority. We, therefore, answer the question against the assessee and in favour of the revenue.
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2014 (1) TMI 1725
Disallowance of business expenditure - Held that:- In the present case, the facts involved are similar to the facts involved in the case of M/s. Shreeshay Engg. Pvt. Ltd. Vs. ACIT(2014 (1) TMI 876 - ITAT MUMBAI) as is evident from the relevant portion of the Tribunal’s order passed in that case and this position is not disputed even by the learned DR.
As in the case of M/s. Shreeshay Engg. Pvt. Ltd., the assessee in the present case has also furnished the relevant details of expenses incurred prior to survey and after the survey at page No.81 of his paper book which clearly shows that the expenses incurred during the post survey period are regular business expenditure which mainly includes provision made for depreciation and interest on the last date of the previous year. The assessee has also filed the profit and loss account for the year under consideration at page 26 of the paper book which clearly shows that the income of ₹ 50 lacs surrendered during the course of survey was separately declared as its income by the assessee and the routine business expenses including the expenses in question incurred during the post survey period were debited to profit and loss account. Thus we set aside the impugned order of the learned CIT(A) on this issue and restore the matter to the file of the AO with a direction considered and allow the claim of the assessee for the impugned expenses as regular business expenses on merit after necessary verification.
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2014 (1) TMI 1724
Additions on unverifiable sundry creditors and excess outstanding balance of sundry creditors - Held that:- In respect of some of the creditors, notices had not been served. In respect of the creditors to whom notices were served, but replies were not received; the AO did not choose to issue summons u/s. 131 of the Act and compel their attendance before him. More over, there is no break-up in Annexure-B creditors given by the AO in his remand report as to which of the creditors were served but not replied and which of the creditors on whom notices were not served. In these circumstances, we are of the considered opinion that in respect of creditors on whom notices were served and who did not send any reply to the AO, the addition made by the AO was rightly deleted by the CIT(A), since the AO did not issue summons to these creditors u/s. 131 of the Act and compel their attendance before him. In respect of the creditors of Annexure-B on whom notices could not be served because they were either not residing or carrying on the business at the address given by the assessee; we are of the view that the assessee should be given an opportunity to ascertain the whereabouts of those creditors and also file some other evidence to substantiate the genuineness of those credits. We are of the view that for this limited purpose, the issue should be remanded to the AO for fresh consideration
As far as Annexure-C sundry creditors are concerned assessee has shown due and payable to the sundry creditors much more than the figures the sundry creditors had shown as receivable from the assessee. Such differences appear only in the case of 36 sundry creditors out of 120 sundry creditors set out in Annexure-C. It is seen that the assessee had filed reconciliation of some of these accounts before the AO and the same is at pages 4 to 6 of the assessee’s paperbook. This reconciliation is in respect of 10 sundry creditors out of 36 sundry creditors in whose accounts discrepancies were found by the AO. For ready reference, the reconciliation so filed by the assessee in respect of 10 sundry creditors is enclosed as ANNEXURE-I to this order. Despite this reconciliation, in the remand report filed by the AO after receipt of this reconciliation, there is no whisper regarding the correctness of the claim made by the assessee nor did the AO demand any further documentary evidence to substantiate the reconciliation. In such circumstances, we are of the view that the reconciliation furnished in respect of these 10 creditors has to be accepted. With regard to the remaining 26 creditors, we are of the view that the assessee should be afforded an opportunity to explain the discrepancies and in this regard the assessee should also be given liberty to file any other supporting evidence to substantiate its case
Estimation of GP percentage - non rejection of books of accounts - Held that:- A perusal of the order of assessment shows that the AO has not made any reference to any of the factors referred to in section 145(3) of the Act. Law is well settled that AO is not entitled to resort to estimation of income without rejecting the book results of the assessee. For rejecting the books results of the assessee, the AO has to make out a case that the conditions laid down in section 145(3) are satisfied. In the present case, the order of the AO as well as the CIT(A) is silent on these aspects. Mere reference to absence of some supporting evidence in respect of entries in the books of accounts in the remand report of the AO before CIT(A) in our view would not be sufficient to invoke the provisions of Sec.145(3) of the Act. In such circumstances, we are of the view that the primary condition for resorting to an estimation of income by the AO is not sustainable - Decided in favour of assessee
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2014 (1) TMI 1723
Sales tax subsidy - Revenue receipt OR capital receipt - Held that:- This issue is covered against the assessee by the decision of the Tribunal in assessee’s own case for ay 2006-07 held the subsidy received by the assessee herein to be capital receipt.- Decided in favour of revenue
Disallowance u/s 14A r.w.r 8D - Held that:- No dividend was to be declared in view of the provisions of section 25 of Companies Act, 1956. Therefore it was not possible to receive any exempt income from this investment by the assessee. Once there was no exempt income then Sec 14A could not be invoked. Therefore we find force in the submissions of the Ld. Counsel for the assessee and hold that Sec 14A could not have been invoked to make disallowance - Decided in favour of assessee
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2014 (1) TMI 1722
Waiver of predeposit of duty along with interest and penalty - Held that:- Commissioner (Appeals) has given a detailed finding and it appears that personal hearing was granted and nobody appeared on behalf the applicant. The issue of cross examination could be examined only at the time of appeal hearing. In view of that, the applicant is directed to make predeposit of an amount of ₹ 1,00,000/- (Rupees One lakh) within eight weeks. Upon such deposit, predeposit of balance amount of duty alongwith interest and penalty is waived and its recovery thereof stayed till the disposal of the appeal. The compliance is to be reported on 14.03.2014.
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2014 (1) TMI 1721
Reopening of assessment - Interpretation of the third proviso to sub- section 3(c)(ii) of Section 80HHC - Held that:- Much later, i.e. after coming into force of the Taxation Laws (Amendment Act), 2005 with retrospective effect from 1998 and even later, some time in 2007, the Assessing Officer (AO) applied the third proviso which was not in existence at the time of assessment and nor for the next four years, and proceeded to reopen the assessment and disallow certain amounts. The assessee's first appeal was unsuccessful and, therefore, it approached the Tribunal, which has granted relief.
This Court is of the opinion that having regard to the circumstances of the case, the AO could not have reopened the assessment for the year 2000-01 on the basis of the retrospective amendment, when the retrospectivity has been struck down and the amendment having been held to be prospective, i.e. from the assessment year 2005-06, over six years later. If the Revenue felt aggrieved, it could have taken appropriate steps to rectify the order in accordance with law within the period prescribed.
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2014 (1) TMI 1720
Computation of deduction u/s 80HHC(3) - claim of assessee for allowance of 10% Duty Draw Back out of indirect expenses for the purpose of computation of deduction u/s 80HHC(3) - Held that:- AO should have examined the claim of the appellant pertaining to the 10% of Duty Draw Back as direct overhead expenses for earning such export incentives before ascertaining the total indirect cost attributable to the exports, in the light of decision of the Special Bench in the case of Surendra Engineering Corporation [2002 (12) TMI 199 - ITAT BOMBAY-H] and Rang International (2004 (7) TMI 275 - ITAT AHMEDABAD-A ) and should have decided to what extent the claim of deduction by the appellant was allowable on the basis of proportionate expenditure. However, from the order passed by the AO it appears that the AO has not at all considered these aspects and not complied with the directions of the ITAT while giving effect to their order. Therefore, the grievance of the appellant is genuine which needs to be addressed. The AO should have examined the issue in the light of the above decisions and any other later decisions, if any, delivered by the other Courts and then through a speaking order, should have decided whether or not to allow any indirect expenses attributable to Duty Draw Back out of the total indirect expenditure attributable to the exports. However, the order of the AO is silent on this issue.
8. Keeping the above lacuna in the order passed by the AO and the specific directions given by the ITAT on this issue, the AO is directed to comply with the ITAT’s directions and pass a consequential order by addressing the above issue in speaking manner so as to give proper effect to the order of ITAT.
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2014 (1) TMI 1719
Reopening of assessment - disallowance u/s 40A(3) - Held that:- CIT(A) has rightly quashed the reopening of assessment made by the Assessing Officer u/s 147 of the Act by observing that there was absolutely no fresh information provided or collected and the initiation of proceedings u/s 147 after a period of four years for effecting disallowance u/s 40A(3) of the Act is not valid. Accordingly, we uphold the order of the CIT(A) and dismiss the grounds raised by the revenue on this issue. - Decided in favour of assessee.
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2014 (1) TMI 1718
Monetary limit - total cumulative tax effect involved in the appeals was less than ₹ 4 Lacs - Held that:- It has fairly been admitted that the tax effect on the disputed addition is ₹ 51,167/-. No exception has been carved out in the permission accorded u/s 253(2) of the I.T. Act, 1961 (in short the Act) by the Ld. CIT Rajkot-II for filing the appeal before the Appellate Tribunal in such cases where tax effect is below ₹ 3,00,000/-. Having regard to the CBDT instruction No. 3 of 2011 dated 09/02/2011 read with Section 268A of the Act, the appeal is dismissed as not maintainable on the ground of monetary limit without expressing any opinion on merits of the case in view of the judgment rendered by the jurisdictional High Court by its order in the case of CIT Vs. Sureshchandra Durgaprasad Khatod (HUF) [2012 (9) TMI 20 - Gujarat High Court ]. Appeal dismissed
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2014 (1) TMI 1717
Rectification of mistake - Disallowance u/s 14A for the purpose of computing the book profits u/s 115JB - Held that:- It is a settled proposition of the Law that AO can only rectify u/s 154 the mistakes apparent / patent from the records. Therefore, the issues of debatable nature are outside the scope of section 154 of the Act. Whether the disallowances u/s 14A can be made and added to the book profits computed/s 115JB of the Act is a debatable one. The issue, being debatable in nature and the same is supported by the existence of divergent decisions cited by the Ld Counsel cannot be rectified as done by the Revenue in this case. - Decided in favour of assessee.
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2014 (1) TMI 1716
Allowable business expenditure - Held that:- As the assessee in the present case has furnished the relevant details of expenses incurred prior to survey and after the survey which clearly shows that the expenses incurred during the post survey period are regular business expenditure which mainly includes provision made for depreciation and interest on the last date of the previous year. The assessee has also filed the profit and loss account for the year under consideration which clearly shows that the income of ₹ 50 lacs surrendered during the course of survey was separately declared as its income by the assessee and the routine business expenses including the expenses in question incurred during the post survey period were debited to profit and loss account. The issue involved in the present case as well as all the material facts relevant thereto thus are similar to the case of M/s. Shreeshay Engg. Pvt. Ltd. (2014 (1) TMI 876 - ITAT MUMBAI) and respectfully following the decision of the coordinate bench of this Tribunal rendered in the said case, we set aside the impugned order of the learned CIT(A) on this issue and restore the matter to the file of the AO with a direction considered and allow the claim of the assessee for the impugned expenses as regular business expenses on merit after necessary verification.
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2014 (1) TMI 1715
Penalty u/s 271(1)(c) - revenue contended that instead of cancelling the penalty, the ld. CIT(A) should have confirmed the penalty as the assessee made wrong claim of carry forward loss from HUF owned family business - Held that:- It is pertinent to note that in the impugned order the ld. CIT(A) didn't cancelled the penalty but directed the Assessing Officer to first give appeal effect to the order dated 13.07.2011 of ld. CIT(A) and thereafter if any addition/disallowance sought to be sustained then only the Assessing Officer should levy a penalty by passing a fresh order on that particular amount of addition/disallowance so sustained, if considered necessary. In our considered opinion, this direction of ld. CIT(A) is factually and legally correct; therefore, we decline to interfere. - Decide against revenue
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2014 (1) TMI 1714
Penalty u/s 271(1)(b) - non-compliance of notice u/s 142(1) - Held that:- As seen in Akhil Bhartiya Prathmik Shikshak Sangh Bhawan Trust vs. Assistant Director of Income Tax, (2007 (8) TMI 386 - ITAT DELHI-G ) assessment have been made under section 143(3) and not under section 144 of the IT Act. It means that subsequent compliance in the assessment proceedings was considered as good compliance and the defaults committed earlier were ignoring by the AO. Hence, the penalty u/s. 271(1)(b) could not be levied.
We find considerable cogency in the Ld. Counsel of the assessee’s submission that the show cause notice does not mention about the noncompliance of notice on which penalty has been levied. Hence, assumption of jurisdiction is not proper. We further find that in these cases the AO has asked explanation of questions and assessee was given only 7 days time. In these circumstances, in our considered opinion, the assessee was not given proper opportunity - Decided in favour of assessee
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2014 (1) TMI 1713
Penalty u/s 271(1)(c) - Held that:- In the case of Hindustan Steel vs. State of Orissa in [1969 (8) TMI 31 - SUPREME Court] held that that “An order imposing penalty for failure to carry out a statutory obligation is the result of a quasi-criminal proceedings, and penalty will not ordinarily be imposed unless the party obliged either acted deliberately in defiance of law or was guilty of conduct contumacious or dishonest, or acted in conscious disregard of its obligation. Penalty will not also be imposed merely because it is lawful to do so. Whether penalty should be imposed for failure to perform a statutory obligation is a matter of discretion of the authority to be exercised judicially and on a consideration of all the relevant circumstances. Even if a minimum penalty is prescribed, the authority competent to impose the penalty will be justified in refusing to impose penalty, when there is a technical or venial breach of the provisions of the Act, or where the breach flows from a bonafide belief that the offender is not liable to act in the manner prescribed by the statute.” - Thus penalty deleted - Decided in favour of assessee
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2014 (1) TMI 1712
Remission of duty payable on finished goods and Cenvat credit availed on inputs - Held that:- It is not only the department which has found negligence on the part of the appellants but also the fire department which is nodal department to consider the circumstances under which such accidents take place and come to a conclusion. Therefore the order of Deputy Chief Inspector of Factories dated 19-5-2006 is important. Further on going through the records it is also found that the police went ahead with prosecution of three persons which finally ended in the acquittal of the persons since the witnesses produced by the prosecution did not support their case and there was no other evidence. This shows that police also felt that accident was avoidable. The fact that police prosecuted three persons would show that police treated the fire as not at all an accident which is much more serious than the accident being avoidable or happened because of negligence. The circumstances are peculiar in this case wherein police and fire department both have entertained the same views as the Commissioner. In fact their views are more disadvantageous than the view of the Commissioner. Hence, find that the rejection of the application for remission cannot be found fault with. Under these circumstances the appeal has no merits and is rejected.
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2014 (1) TMI 1711
Benefit of Notification No. 67/95 denied - Denial of remission of duty - extended period of limitation - Held that:- As in the show cause notice there is no indication of denial of remission but simply a demand for duty. It is not indicated as to how the goods have to be treated as removed from the factory. Secondly in the present Central Excise Rules when duty paid goods are received back into the factory and the process amounts to manufacture, Cenvat credit can be availed and such credit can be utilized for payment of duty on the goods which are manufactured after reprocessing. In the case of piston, once they are melted, in the normal process pistons would be manufactured again and such manufactured piston would be cleared.
Therefore in terms of Rule 16 also even if the pistons were taken back for processing after removal the appellants would be perfectly well within his rights to take back the credit of duty paid by the assessee at the time of removal and utilise the same for payment of duty on the finished goods. Therefore there is considerable force in the argument advanced by the learned counsel that the benefit of Notification No. 67/95 would be available in this case. Thus the situation here is comparable to the provisions of Rule 16 and since the goods have not been removed on payment of duty, benefit of Notification No. 67/95 would be applicable. Under these circumstances, the extended period for demanding duty should not have been invoked at all in view of the fact that there can be two views on the statutory provisions themselves as discussed above. When there is a question of interpretation, extended period would not have been invoked. On merits also, find no case for demanding the duty, interest and imposition of penalty - Decided in favour of assessee
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2014 (1) TMI 1710
Rejection of claim of the writ petitioner – Podhu Dikshitars to administer the Temple - Held that:- Explanation to Order XLVII, Rule 1 of Code of Civil Procedure, 1908 (hereinafter referred to as the ‘CPC’) provides that if the decision on a question of law on which the judgment of the court is based, is reversed or modified by the subsequent decision of a superior court in any other case, it shall not be a ground for the review of such judgment. Thus, even an erroneous decision cannot be a ground for the court to undertake review, as the first and foremost requirement of entertaining a review petition is that the order, review of which is sought, suffers from any error apparent on the face of the order and in absence of any such error, finality attached to the judgment/order cannot be disturbed
In view of the fact that the rights of the respondent no. 6 to administer the Temple had already been finally determined by the High Court in 1951 and attained finality as State of Madras (as it then was) had withdrawn the notification in the appeal before this Court, we are of the considered opinion that the State authorities under the Act 1959 could not pass any order denying those rights. Admittedly, the Act 1959 had been enacted after pronouncement of the said judgment but there is nothing in the Act taking away the rights of the respondent no. 6, declared by the court, in the Temple or in the administration thereof.
Even if the management of a temple is taken over to remedy the evil, the management must be handed over to the person concerned immediately after the evil stands remedied. Continuation thereafter would tantamount to usurpation of their proprietary rights or violation of the fundamental rights guaranteed by the Constitution in favour of the persons deprived. Therefore, taking over of the management in such circumstances must be for a limited period. Thus, such expropriatory order requires to be considered strictly as it infringes fundamental rights of the citizens and would amount to divesting them of their legitimate rights to manage and administer the temple for an indefinite period. We are of the view that the impugned order is liable to be set aside for failure to prescribe the duration for which it will be in force.
The word `regulate’ is difficult to define as having any precise meaning. It is a word of broad import, having a broad meaning and may be very comprehensive in scope. Thus, it may mean to control or to subject to governing principles. Regulate has different set of meaning and must take its colour from the context in which it is used having regard to the purpose and object of the legislation. The word `regulate’ is elastic enough to include issuance of directions etc.
The power under the Act 1959 for appointment of an Executive Officer could not have been exercised in the absence of any prescription of circumstances/ conditions in which such an appointment may be made. More so, the order of appointment of the Executive Officer does not disclose as for what reasons and under what circumstances his appointment was necessitated. Even otherwise, the order in which no period of its operation is prescribed, is not sustainable being ex facie arbitrary, illegal and unjust.Thus, the appeals are allowed.
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9911796707
