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Case Laws
Showing 241 to 260 of 1843 Records
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2017 (1) TMI 1608
Taxability of amount received from Insurance Companies against damages - Additions u/s 41 or 45(1A) - CIT(A) was convinced with the assessee that taxability of the Insurance Claim as capital gains is not permissible as the amendment to Section 45(1A) is with effect from 1.04.2000 and is applicable from assessment year 2000-01 and, therefore, not relevant for the year under consideration. However, the ld. CIT(A) kept silent on the issue of taxability of the same u/s. 41 of the Act as observed by the A.O. - Held that:- A perusal of the order of the authorities below do not show whether the damages have been charged to the Profit and Loss account or not. There is no reference to that effect in the orders of the authorities below. If the assessee has claimed the damages due to wind storm and charged the same to its profit and loss account then any claim received from the Insurance claim shall be deemed to be profit and gains of business or profession and accordingly chargeable to Income Tax as the income of that previous year. - Matter remanded back.
Disallowance of Lease Rent - sale and lease back transaction - AO observed that, sale and lease back transaction with Arvind Mills Ltd. was nothing but a financial transaction and accordingly lease rentals constituted capital payment and hence not allowable. - Held that:- following the earlier decision of tribunal, deduction allowed - Decided in favor of assessee.
Enhancement of the income out of Lease Rent expenses payable to ICICI - Method of accounting - Claiming of expenditure of ₹ 7,84,86,179/- in the Income Tax Return - The assessee strongly contended that the company had incurred expenditure on lease rental, legal and consultancy fees and retrenchment compensation which is enduring benefit and, therefore, it has been treated as deferred revenue expenditure to be written off in subsequent years and an amount of ₹ 1,87,03,288 has been debited to the Profit and Loss account of the year under consideration. - Held that:- Considering the aforementioned ratios laid down by the Hon’ble Supreme Court and the Hon’ble Jurisdictional High Court, in our considered opinion, whatever expenditure has been accrued during the year under consideration has to be allowed to be written off. We, therefore, direct the A.O. to examine the accrual of expenditure for the year under consideration and allow the same in the light of the aforementioned rulings. - Decided partly in favor of assesseee.
Disallowance for power expenses of earlier years - crystallization of liabiltiy - Held that:- It is only the payment schedule was to start from May next but this does not mean that the power expenses have to be disallowed for the year under consideration. Since the liability has crystallized during this year itself, expenditure to be allowed - Decided in favor of assessee.
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2017 (1) TMI 1607
Nature of expenditure - dismantling expenses - capital or revenue expenditure - Held that:- assessee has incurred expenses in dismantling the plant and machinery to replace and install the new one in order to upgrade and enhance the production capacity of the assessee - following the decisions in various cases, expenses allowed u/d 37(1) - Decided in favor of assessee.
Nature of expenses incurred towards Gujarat Earthquake relief and claimed deduction u/s 37(1) - Held that:- FAA allowed the same by holding these expenses at par with community welfare expenses which has been allowed as admissible expenses in assessee‟s own case supra. - Order of CIT(A) confirmed - Decided in favor of assessee.
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2017 (1) TMI 1606
Commercial or Industrial Construction Service - case of Revenue is that the gross amount received during the year 2005-06 towards rendering service has not been properly recorded in the impugned order - Held that:- The Revenue has not submitted any supporting evidence against such factual findings.
Valuation - case of Revenue is that the valuation of taxable service should be based on gross amount including the value of free of cost material supplied by the recipient of service - Held that:- The details of RA bills were examined by the lower authority, who categorically recorded that the amount received by the respondent has been correctly recorded in the books of accounts. Further, the details of payment received from contractor is already with the Department. The legal/court dispute between the respondent and the recipient of service has also been noted - the Tribunal held the value of free materials supplied by the recipient of service cannot form part of taxable service as held in Bhayana Builders [2013 (9) TMI 294 - CESTAT NEW DELHI (LB)].
Benefit of cum-tax value - benefit cannot be extended as the respondent did not produce any supporting evidence to the effect that the considerations received were inclusive of service tax - Held that:- The respondent have not produced evidence to the effect that the considerations received were inclusive of service tax. In order to consider the amount received as inclusive of service tax in terms of Section 67(2) of the Finance Act, 1994, it is necessary to show that the gross amount charged by a service provider is inclusive of service tax payable. In absence of such evidence, cum-tax benefit cannot be extended.
The respondent have to discharge service tax involved in the present case on the value received and provisions of Section 67(2) are not available for determining the amount of tax - appeal disposed off.
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2017 (1) TMI 1605
Classification of services - transportation charges received by the appellants from SECFL for transportation of coal from coal face to railway siding/ yard within mining area - whether classified under the head GTA Services or under the head Mining services? - Held that:- The GTA Service received by SECFL was subjected to tax at the recipient end. Declaration along with details of payment of such tax by SECFL has been placed on record - Reliance was placed in the case of M/S. ARJUNA CARRIERS PVT. LTD. VERSUS C.S.T., RAIPUR [2014 (11) TMI 1048 - CESTAT NEW DELHI], where it was held that Mere handling of coal and movement of said goods from railway wagon to the site of thermal power station through the motor vehicle or any other means of transportation involved in such handling would not constitute Cargo Handling Service and will be considered as GTA services - appeal allowed - decided in favor of appellant.
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2017 (1) TMI 1604
Constitutional validity of Rule 8(3A) of the Central Excise Rules 2002 - Utilization of cenvat credit for payment of excise duty for default in payment of duty - demand of duty in cash - Held that:- The issue involved in the present case is no longer res integra and decided by various High Courts as well as in several decisions of the Tribunal, in favor of the appellant - Tribunal in the case of M/S PIONEER LABORATORIES PVT. LTD. VERSUS CCE, INDORE [2016 (10) TMI 909 - CESTAT NEW DELHI] placed reliance on the decision of the case Indsur Global Ltd. vs. Union of India [2014 (12) TMI 585 - GUJARAT HIGH COURT] where it was held that Condition contained in sub-rule (3A) of rule 8 for payment of duty without utilizing the cenvat credit till an assessee pays the outstanding amount including interest is declared unconstitutional. Therefore, the portion "without utilizing the cenvat credit" of sub-rule (3A) of rule 8 of the Central Excise Rules, 2002, shall be rendered invalid.
The Rule itself has been stuck down as unconstitutional - demand do not sustain - appeal allowed - decided in favor of appellant.
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2017 (1) TMI 1603
TDS u/s 194C - addition u/s 40(a)(ia) - TDS not deducted on payment to labour representative (Mukadams) - Held that:- AO did not establish the aspect by bringing any evidence that assessee made the payment in pursuance of a contract and simply jumped to the conclusion that these payments were contractual payment despite the deposition (affidavit) of Mukadams confirming the fact that they were employee of the assessee.
CIT(A) fairly concluded that he did not find any indication which may suggest that the payments were made under the contract, in fact the payment were received by the laborers from the assessee. All the payments made to the laborers were below to ₹ 50,000/-. There is no evidence that labour were engaged on regular basis, which may give rise to the fact that there was a contract in existence and deleted the disallowances. We have seen that the ld. CIT(A) passed the order after considering the entire fact, affidavit of Mukadams and the nature of payment. In view of the above discussion, we do not find any reason to interfere in the findings of ld. CIT(A). - Decided against revenue
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2017 (1) TMI 1602
Liability of Tax - amount collected towards supply of study material/kit, from the candidates - Commercial Training and Coaching Services - Benefit of N/N. 12/03-ST dated 20.06.2003 was not allowed on the ground that they have provided a composite service of coaching and the study materials are essential for rendering service - Held that:- Appellants have separate receipt for supply of books and study materials indicating the price clearly. They have sold such study materials /books to non-registered students. Their prospectus advertising for various coaching programmes clearly mentions the price of books and study materials.
The appellant’s claim for exemption under N/N. 12/03-ST cannot be rejected - appeal allowed - decided in favor of appellant.
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2017 (1) TMI 1601
Entitled to the benefit of deduction u/s 80P(2)(a)(i) - interest income earned from nationalized bank, scheduled bank and TDS on interest i.e. interest income other than derived from investments with any other co-operative society - Held that:- Assessee is not eligible for deduction u/s 80P(2)(a)(i) of the Act on the interest income earned from surplus deposits held with Nationalized/Scheduled banks.
Assessee will be eligible to statutory deduction of ₹ 50,000/- u/s 80P(2)(c)(ii) of the Act.
Assessee will also be eligible to claim pro rata expenses for earning interest income of ₹ 8,55,854/- assessee’s claim of pro rata expenses of ₹ 5,77,423/- against the interest income of ₹ 8,55,854/- after due verification by the learned Assessing Officer. We, therefore, direct the Assessing Officer to verify assessee’s claim of pro rata expenses by examining the record to be shown for verification by the assessee. Needless to mention proper opportunity of being heard is to be given to the assessee. We order accordingly. The appeal of the assessee is partly allowed for statistical purposes.- Appeal of the assessee is partly allowed for statistical purposes
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2017 (1) TMI 1600
Promotion to the post of Commissioner of Income Tax - the promotion of applicant was not put in sealed cover as it was not approved - no criminal or disciplinary proceedings were pending against the applicant - Held that:- On the date of consideration for promotion to the post of Commissioner of Income Tax by the DPC, i.e. 05.06.2015, no criminal or disciplinary proceedings were pending against the applicant. He was found fit by the DPC and recommended for promotion. ACC, however, did not approve his promotion and desired that all complaints be decided. As a matter of fact, no complaint was pending against the applicant. The only criminal case registered against him had been closed by the investigating agency (CBI) itself and the closure report filed u/s 173 CrPC was accepted by the Special Judge, CBI.
The case of the applicant is squarely covered by the provisions contained in DOP&T office memorandum No.22011/4/91-Estt.(A) dated 14.09.1992, which came to be issued pursuant to the judgment of the Hon’ble Supreme Court in Union of India etc. v K. V. Jankiraman [1991 (8) TMI 292 - SUPREME COURT] where it was held that No promotion can be withheld merely on the basis of suspicion or doubt or where the matter is under preliminary investigation and has not reached the stage of issue of charge sheet etc. If in the matter of corruption/dereliction of duty etc., there is a serious complaint and the matter is still under investigation, the Government is within its right to suspend the official. In that case, the officer’s case for promotion would automatically be required to be placed in the sealed cover.
In the present case, no criminal or disciplinary proceedings were pending against the applicant as on the date of consideration of his case for promotion to the post of Commissioner of Income Tax, i.e. 15.06.2015, as the closure report in the criminal investigation against him had already been accepted by the Special Judge, CBI vide order dated 12.03.2014.
Respondents are directed to implement the recommendations of DPC dated 05.06.2015. The applicant shall be entitled to notional promotion to the post of Commissioner of Income Tax from the date his juniors, namely, Satpal Gulati and B. Venkataswara Rao were promoted, and financial benefit from the date of actual promotion - application allowed.
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2017 (1) TMI 1599
Classification of services - transportation of coal within the mine - whether to be classified under GTA Services or under the head Mining Services? - Held that:- In Arjuna Carriers Pvt. Limited [2014 (11) TMI 1048 - CESTAT NEW DELHI] the Tribunal held that service is not classifiable under mining service, as held by the Revenue - the service is rightly classified under GTA Services - appeal allowed - decided in favor of appellant.
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2017 (1) TMI 1598
Addition on account of late deposit of PF, ESIC and professional tax - Held that:-It is a clear finding by the CIT(A) that the assessee paid the Employees’ contribution to Provident Fund, ESIC and Professional Tax before the due date of furnishing the return u/s. 139(1) of the Income Tax Act, 1961. Thus, there is no need to interfere with the order of the CIT(A)in deleting addition . The appeal of the Revenue is dismissed . See CIT vs. M/s. Vinay Cement Ltd. [2007 (3) TMI 346 - SUPREME COURT OF INDIA] and CIT Vs. AIMIL Ltd. (2009 (12) TMI 38 - DELHI HIGH COURT) - Decided in favour of assessee.
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2017 (1) TMI 1597
TPA - computing the eligible relief under section 10A - Held that:- Following the Patni Telecom Pvt. Ltd.[2008 (1) TMI 452 - ITAT HYDERABAD-A] we are of the opinion, that e4e is not involved in rendering technical services outside India, but it in the business of export of BPO services as contemplated under the provisions of section 10A of the Act from its offshore centre in India. It is not engaged in rendering onsite services and therefore, telecommunication expenses and travel expenses incurred in foreign currency should not be excluded from the ET and TT in computing the eligible relief under section 10A of the Act.
Further, BPO services, undertaken for the purposes of export cannot be equated to providing technical services outside India solely for the purpose of excluding travel expenses incurred in foreign currency from the ET as envisaged in the definition of ‘export turnover’ as provided in section 10A of the IT Act. Accordingly, the adjustment made by the AO is to be quashed in entirety. We direct the AO to re-work the same.
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2017 (1) TMI 1596
Stay of demand - pre-deposit requirement - payment of 15% of the disputed demand - Held that:- The decision of the Allahabad High Court in Jagran Prakashan ltd. v. Deputy Commissioner of Income Tax (TDS) [2012 (5) TMI 488 - ALLAHABAD HIGH COURT] is relied on by the petitioners. The Appellate Authority has noticed the said judgment in its order. However, more pertinent would be the words employed in the Circular, which refers to a decision of the Hon'ble Supreme Court or the jurisdictional High Court. In such circumstance, based on the Allahabad High Court judgment, no stay can be demanded as a matter of right by the assessee.
Assessee in default - Tax Deduction at Source (TDS) having not been made for payment of interest in the deposits accepted by the petitioners, nor Form Nos.15G/15H having been produced - Held that:- assessee did not produce the documents before the Assessing Officer who has to verify it. As of now, the assessee is in default and the orders cannot be interfered with. In such circumstance, the assessee would be required to make payment of atleast 15% of the disputed demand, within a period of three months from the date of receipt of a certified copy of this judgment, failing which, the recovery proceedings shall continue.
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2017 (1) TMI 1595
TCS - Provisions of Section 206C applicability - petitioner-Corporation is not a first seller and is a second seller is the question of law that arises for consideration in this appeal - Held that:- Income Tax authorities including the Income Tax Appellate Tribunal rightly held that the provisions of Section 206C of the Income Tax Act, 1961 were applicable to the petitioner-Corporation as the petitioner was the first seller and not the second seller, as claimed by it. See MAHARASHTRA STATE COOPERATIVE TRIBAL DEVELOPMENT CORPORATION LTD. VERSUS COMMISSIONER OF INCOME TAX, ASSISTANT COMMISSIONER OF INCOME TAX, TDS CIRCLE, NAGPUR [2017 (1) TMI 1039 - BOMBAY HIGH COURT]
Since the only question involved in this income tax appeal is answered against the appellant-Corporation, appeal dismissed.
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2017 (1) TMI 1594
Penalty u/s 271(1)(c) - certain amounts ought to have been deducted by virtue of Section 194J and non compliances of which, resulted in an adverse order and disallowance under Section 40(a)(i) - Held that:- The present proceedings emanate out of the penalty imposed by the AO. The CIT(A) took note of the same in the intervening period as well as of the judgment of the Supreme Court in K. C. Builders v. ACIT [2004 (1) TMI 7 - SUPREME COURT] and deleted the penalty. The ITAT has confirmed that order.
As is evident from the factual narrative, the primary question of disallowance itself was debatable – in appeal to the ITAT the assessee was successful. In the circumstances, the deletion of the penalty by the CIT(A) and the ITAT cannot be called unreasonable, justifying interference by this Court. Therefore, no substantial question of law arises.
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2017 (1) TMI 1593
Violation of the principles of natural justice - case of the assessee that on the basis of a statement recorded from one Ranga Rao behind the back of the assessee, the order of assessment came to be passed without supplying the copy of the statement or giving an opportunity to the assessee to cross-examine - Held that:- The law is very clear that whenever an order is vitiated for non-compliance with the principles of natural justice, the order should be set aside and the matter remitted back to the same authority. It is only in cases where the original authority had lost its jurisdiction in the meantime, an order of remand cannot be passed.
The powers of the Income Tax Appellate Tribunal to pass an order of remand are not in doubt nor in dispute. Therefore, the contention that an order of assessment passed in violation of the principles of natural justice is void abinitio, is completely contrary to the fundamental principles of law, especially when the original authority had not lost its jurisdiction so as to become ineligible to deal with the issue after remand. - Decided against assessee.
Payment of on-money - Held that:- The case of the assessee is alleged to fall under the second category. This is not a case where the company M/s. Emaar Hills Township (P) Ltd., has admitted to have received any on- money from the assessee. This is a case where other persons, who bought the property from the very same company, had allegedly paid huge amounts for the purchase of the property. These statements may indicate three things, viz., (1) that the assessee also might have paid the very same rate; or (2) that the assessee was conferred with the special privilege of a reduced rate, which may attract other provisions of the Act; or (3) that the market value of the property purchased by the assessee was not the same as indicated in the title documents. When the Assessing Officer is left with the option of examining all these three alternatives, it is not correct on the part of the department to think that the fate of the assessment is now sealed. Hence the second question of law is answered accordingly
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2017 (1) TMI 1592
CENVAT credit - inputs - whether structural items such as M.S. Flats, Channels, Plates, Beams, etc., which are used to fabricate structures to house the coal washing plant are covered within the definition of input given in Rule 2(k) of the CCR 2004? - Held that:- These inputs have been used to fabricate coal washing plant. The coal washery is an integral part of the unit. There can be no coal washery without the coal washing plant - credit cannot be denied - appeal dismissed - decided against Revenue.
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2017 (1) TMI 1591
Revision u/s 263 - under statement of book profit under section 115JB - Held that:- The assessee has claimed the adjustment under the head "provision" which when understood on ordinary and natural sense will give rise to presumption of it being a provision. It was for the assessee to rebut the presumption by proper explanation which has not been done. No enquiry on it being different from mere provision has been conducted by the AO.
The order passed by the AO in discharge of its quasi-judicial functions is clearly erroneous and prejudicial to the interest of the Revenue as noted. Certain explanation has been given by the assessee on merits to justify that it is actual diminution and not mere provision. However, that will become relevant only at the stage of making assessment therein after requisite enquiry in this regard. Thus at the threshold, for invoking the jurisdiction, the conclusion of the CIT of the order being erroneous and prejudicial to the interests of the Revenue cannot be faulted.
Referring to the second limb of arguments on behalf of the assessee that the amendment to section 115JB as per clause(i) thereto has been made with retrospective effect after filing of the return of income and therefore the assessment passed based on the return of income as per the law as stood at the time of filing of the return could not have been disturbed by the AO we do not find any merit in this line of argument either.
The record for the purpose of section 263 as per Explanation-1 thereof would mean all records relating to assessment proceedings available at the time of examination by the Commissioner. Therefore, any development in law which has taken place even after the assessment also can be taken cognizance of by the CIT in exercise of power under section 263 of the Act. - Decided against assessee.
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2017 (1) TMI 1589
Principles of Natural Justice - fresh examination of matter requested - Held that:- The ld. Adjudicating authority directed to grant a fair opportunity of hearing to the appellant.
Penalty - Held that:- There shall be no penalty in view of the interpretation of law involved in the case.
Appeal allowed in part and part matter on remand.
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2017 (1) TMI 1588
Addition u/s 41 - refund of entry tax receivable from the Government of Andhra Pradesh - taxability in a instant year - Held that:- The levy of income tax is on real income - the crediting of amount in the P&L account itself would not be conclusive to say that the corresponding income has accrued to the assessee, so as to be liable for taxation - hence we hereby direct that the lower authorities have erred in invoking the provisions of section 41 to include a sum of ₹ 2,07,80,623/- in the total income - Decided in favor of assessee.
Taxation of royalty income received from its overseas subsidiary - Non taxability in India - DTAA between India and Egypt - Held that:- It is claim which involves a point of law with necessary facts being on record - in such a situation, even if, the claim has not been made at an earlier stage, income-tax authorities are entitled to admit such a claim - hence we deem it fit and proper to admit the claim of the assessee and restore it to the file of the AO for adjudication on merits after giving reasonable opportunity of being heard to the assessee - partly allowed in favor of assessee.
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