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Showing 241 to 260 of 1287 Records
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2014 (11) TMI 1050
Unexplained investment - CIT(A) partly deleted the addition - Held that:- merit in making addition by A.O. or partly being confirmed by Ld. CIT(A). First of all, the stock taken was done in the middle of the year and assessee has every right to reconcile the stocks but no such opportunity was given. Further, when assessee explained in the statement that accounting in the books of accounts is about net non-defective area, the officers of survey could have examined this contention and establish whether statement of assessee is correct or not, given in the course of survey. Nothing was done except quantifying the stock. As seen from the order, Ld. CIT(A) accepts that there could be adjustments for the defective pieces/slabs. However, in his wisdom, he restricted the allowance to 10% without any basis. Considering that books of accounts were not rejected and special auditor in his report also has not pointed out any defects, we are of the opinion that the balance of the amount also should be deleted. In fact, excess area arrived at in the stock inventory is about 15% of the stock actually recorded by assessee in the books of accounts and as submitted there could be variation to the extent of 15% to 18%. In view of this, we delete the balance of the amount also. - Decided in favour of assessee
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2014 (11) TMI 1049
Extended period of limitation invoked - demand was confirmed and proposed equal amount of penalty was confirmed with interest - suppression on part of the appellant - Held that:- As find that from ER-1 return para 5A and 5B of the same batch, the appellant have shown the break-up of duty as 8 + 2%, although it have inadvertently not shown the AED - GSI in column 5 (in para 5B). By practice in vogue, from casual look of the return, it is evident that when AED - GSI is leviable in addition to basic duty 8 + 2% indicates in column 5A that the appellant have charged basic duty + AED GSI on his output during the period in dispute. In this view of the matter, I hold that there is no suppression of facts, or fraud etc. made out against the appellant. Thus, I hold that the Commissioner (Appeals) has erred in holding that the extended period is invocable. I further hold that in the facts and circumstances, Section 11A is not invocable and the provision of extended period of limitation is also not invocable. Thus, the impugned order is set aside and the appeal is allowed with consequential relief, if any.
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2014 (11) TMI 1048
Classification- Transportation of coal - Whether classifiable under Cargo Handling Service or GTA - Held that: Service tax on the impugned service is paid by M/s. SECL under GTA supports the appellants contention that the service is covered under GTA service and not under Cargo Handling Service. The agreement entered by appellant with M/s. SECL is also clearly for transport of coal. Also, the Commissioner vide several orders has also held that the said service is covered under GTA services. Therefore, the impugned service is not classifiable as Cargo Handling Service as per the decision taken by the Tribunal in the case of M/s. Narayan Builders 2013 (9) TMI 146 - 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 also in the case of Anupama Coal Carriers Pvt. Ltd. Vs. CCE, Raipur 2012 (5) TMI 290 - CESTAT, NEW DELHI, that just bringing coal to railway siding would not be covered by Cargo Handling Service. - Decided in favour of appellent
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2014 (11) TMI 1047
Validity of Assistant Commissioner of Customs order- Non-speaking order passed confirming huge amount of duty with interest when Hon'ble Supreme Court ordered to maintain status quo- Held that: No order could be passed in terms of the Tribunal’s order and the assessment could not have been finalized when the Hon'ble Supreme Court ordered to maintain status quo while admitting the civil appeal. The only course of action left is to await the outcome of the decision of the Hon’ble Supreme Court in the said Civil Appeal and thereafter, appropriate action in accordance with law could be initiated. Therefore, the orders passed by both the lower authorities are set aside as being non- speaking and incorrect in law and are directed to await the outcome of the decision of the Hon’ble Apex Court in the matter before initiating any final action. - Decided in favour of Revenue
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2014 (11) TMI 1046
RTI application - name and designation of the CPIO dealt with it and inspection of all files, copies of related noting documents - Held that:- Section 2(j) explains right to information includes ‘inspection of work, documents, records; taking notes, extracts or certified copies of documents or records; taking certified samples of material. The Commission observes: When huge information/record sought pertains to a larger period such as ten or more years, which does not attract Section 8 or 9, the best way of realization of right to information is to facilitate inspection. It will help the appellant to select the relevant documents and seek copy of only those documents found relevant instead of copying huge number of files unnecessarily involving huge expenditure and time for both parties. The public authority should create a specific and convenient place for facilitating inspection taking enough care for security of records. If someone wants copy of entire record of the office, it may not be possible or reasonable besides attracting the restriction under Section 7(9). If the records pertaining to areas exempted from disclosure are separated and the public records are kept accessible to citizens, it would serve the purpose. During the inspection the appellant should be facilitated to sit and take notes from the files and if he seeks copies of any documents which are permissible, they shall be given then and there at prescribed cost.
The Commission makes following recommendations:
a) the appellant to have inspection and seek copies of papers, if he thinks necessary, if not furnished earlier.
b) the appellant not to consider it as suppression of records, which the officers were fearing about,
c) with regard to his earlier RTI applications also the Commission would like the appellant to rationalize and minimize requirement of copies of documents strictly relevant to the aspect of public interest so that the officers would not worry about the stress and time needed to collect huge amount of information
d) the respondents consider possibility of facilitating inspection before invoking Section 7(9) of RTI Act.
e) both the respondents and appellant to have a coordinated approach in securing reasonable and only information required in public interest.
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2014 (11) TMI 1045
Rate of VAT on sale of Appy Fizz. Treating the product as fruit juice, an item falling under entry 71(2) of SRO No.82/2006 - the petitioner paid tax @12.5%. However, proceedings were initiated under Section 25 of the KVAT Act proposing to levy tax @20%, treating the product as an aerated branded soft drink, falling under Section 6(1)(a) of the KVAT Act. - Held that:- the product is an aerated soft drink and the fruit juice is added as a flavouring agent, which cannot alter the character of the product. In Entry 71(1) of SRO 82/06, the aerated products included are aerated water and soda water. Fruit juice included in entry 71(2) and soft drinks included in entry 71(3) are all products which are not aerated. This, therefore, makes it clear that aerated products, except those which are specifically included in entry 71, are outside the purview of SRO No.82/06 and consequently, the product in question has to be treated as an aerated branded soft drink coming within the purview of Section 6(1)(a) of the KVAT Act. - Decided against the assessee.
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2014 (11) TMI 1044
Validity of assessment u/s 153C - absence of satisfaction note - Held that:- In the light of the order of the co-ordinate bench in the case of M/s. V.K. Fiscal Services Pvt. Ltd (2013 (11) TMI 1589 - ITAT DELHI) and Pepsico India Holiday (P) Ltd (2014 (8) TMI 898 - DELHI HIGH COURT), we hold that the AO lacks jurisdiction to initiate the 153C proceeding against the assessee and therefore the issuance of notice itself is null and void and therefore quashed. Consequently the impugned assessment order u/s 153C is also a nullity. - Decided in favour of assessee
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2014 (11) TMI 1043
Jurisdiction of Settlement Commission - scope of the term 'Case' - petitioner contends that the pendency of an appeal before the Commissioner (Appeals), does not bar the Settlement Commission from exercising jurisdiction as the Commissioner (Appeals), Chandigarh, is neither a Tribunal nor a Court. - Held that:- The expression “before adjudication” necessarily refers to an adjudication by the assessing authority, thus, clearly postulating that where adjudication by the assessing authority has concluded, jurisdiction of the Settlement Commission to entertain such an application, is barred.
Admittedly, the adjudicating authority has concluded adjudication. The Settlement Commission, therefore, had no jurisdiction to entertain the petitioner’s application and has rightly rejected the application summarily. The petitioner’s submission based upon the first proviso to Section 127B or that his application has been rejected as his appeal was pending is irrelevant as the Settlement Commission has not been dismissed the application on the ground of pendency of the appeal etc. - Decided against the appellant.
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2014 (11) TMI 1042
Claim of refund due to difference in quantity of import - remission of duty on the lost quantity. - loss of quantity of goods had occurred after its clearance for home consumption - duty was paid on higher quantity of import of Propene (Propylene) Polymer grade - Commissioner of Customs (Appeals), allowed the appeal of the importer. - Jurisdiction of tribunal to entertain the appeal
Held that:- Appellate Tribunal does not have jurisdiction to decide the appeal in respect of any order referred to in clause (b) of sub-section (1) to Section 129A of the Customs Act, which is relatable to short-landing.
In view of the specific finding of fact by the Tribunal and the provision of law which oust the jurisdiction of the Tribunal, we find no error in the order of the Tribunal declining to entertain the appeal on an interpretation of proviso to sub-section (1) to Section 129A of the Customs Act. - Decided against the revenue.
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2014 (11) TMI 1041
Disallowance u/s 14A - whether prescribed formula for allocating interest attributable to other income, based on proportionate investment, would apply? - Held that:- As we observe from the investment chart adduced, the source of funding of many an investment in shares is ‘ICD’, i.e., inter-corporate deposits, which only denotes borrowed capital. Further, even as observed during the course of hearing, with reference to the assessee’s balance-sheet (PB pgs.3-14), to of-course no repudiation by the ld. AR, the assessee’s entire capital of ₹ 8.36 crores, both at the beginning and the close of the year, stands completely wiped off; the debit balance of the profit and loss account as at the relevant dates being at ₹ 11.36 crores and ₹ 11.62 crores respectively. The assessee’s net worth being negative throughout the year, all its assets, including the tax-exempt investment in shares, stand financed from borrowed capital in the form of unsecured loans. Proportionate allocation, as advocated by r. 8D(2)(ii), statutorily prescribed per s. 14A, thus becomes even otherwise, i.e., having regard to the assessee’s accounts, the most appropriate method.
The interest in respect of the said funds, since lost, would also stand to be allocated amongst the assessee’s assets. Qua this, we observe the interest (income) on advances to be much higher than on investments yielding dividend, so that the loss or deficiency on account of interest cost, which is the principal expenditure, is substantially, if not wholly, attributable to these investments. The proportionate method u/r. 8D(2)(ii) followed by the Revenue, according equal weight to all the assets, irrespective of the income generated by them, and therefore their contribution to the loss (of capital), thus, rather, favours the assessee in the facts of the case. We accordingly find no merit in the assessee’s case, and have no hesitation in upholding the impugned order qua this disallowance. - Decided against assessee
Disallowance of book profit u/s.115JB - Held that:- No basis for not confirming the adjustment of the expenditure, as finally sustained for disallowance u/s. 14A(1), in computing the book profit u/s.115JB. - Decided against assessee
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2014 (11) TMI 1040
CENVAT credit on inputs which lost in fire “as such” denied - Held that:- As per Rule 3(5B) of C.C.E which is reproduced here-in- under, the appellant is required to reverse the CENVAT credit on the inputs which have been written off in their books of accounts on account of fire or any other accidents.
Therefore, hold that the appellant is required to reverse CENVAT credit on inputs which have been lost in fire “as such”. Further, as find in the claim of the appellant that certain inputs were not purchased by them against Central Excise invoices and they are not claiming CENVAT credit on them. This aspect has to be examined by the adjudicating authority hence, the matter; needs examination at the end of the adjudicating authority.
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2014 (11) TMI 1039
Authority competent to issue show cause notice to the petitioner - Held that:- It is well settled that ordinarily no writ lies against a show cause notice. A mere show cause notice does not infringe the right of any one. It is only when final order adversely affecting the party is passed, then the said party can be said to have any grievance. The writ jurisdiction is discretionary and hence, such discretion in the light of the law laid down by the Apex Court in catena of decisions under Article 226 of the Constitution of India, should not ordinarily be exercised by quashing a show cause notice. It is in very rare and exceptional cases, this Court can quash a show cause notice, if it is found to be absolutely without jurisdiction or for some other reason, if it is wholly illegal.
It is well settled that in taxation matters, principles of res judicata is not applicable.
In view of the above we are of the view that the learned authority is competent to issue show cause notice to the petitioner. The show cause notices in question are pertaining to the subsequent period. The petitioner is directed to respond to the show cause notice and take all stands highlighted in this writ petition and if any adverse order is passed, he may challenge the same by filing an appeal under the provisions of Section 35 of the Central Excise Act, 1944.
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2014 (11) TMI 1038
Eligibility for Cenvat Credit - input used in generation of power by the appellant - Held that:- There is no finding in any part of the order to show that the power transmitted by the appellant to its sister concern was used for the purpose other than manufacture. In absence of such finding there cannot be denial of Cenvat Credit. - Decided in favour of assessee
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2014 (11) TMI 1037
Reopening of assessment - transaction of shares - accommodation entries - Held that:- At the time of hearing before us, it was pointed out by the learned counsel that the assessee was having 50,000 shares of ₹ 10/- each and the said shares were sold at cost to M/s Shimmer Marketing Pvt. Ltd. and the sum of ₹ 5 lakhs has been received as a sale consideration of shares which were already disclosed in the assessee’s books of account. The purchase of shares as well as sale of shares both have been disclosed in the assessee’s books of account and it has not generated either any profit or loss in the books of account nor any additional flow of capital in the assessee’s books of account. These facts stated by the learned counsel could not be controverted by the Revenue.
Thus we hold that the reopening of assessment under Section 148 on the above facts was not justified. We, therefore, quash the issue of notice under Section 148 and consequently, the assessment order passed in pursuance to such notice is also quashed. - Decided in favour of assessee
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2014 (11) TMI 1036
Transfer pricing adjustment - determination of purchases - Held that:- We accept the first fold of submission made by the assessee and direct the Assessing Officer to confine the adjustment, qua the purchases made by the assessee from the AE. To be more specific, the adjustment is to be made only to the purchases made from the AE. However, this exercise be carried out after verifying the details of purchases available of the TP study report. The Assessing Officer first determine the purchase of raw material and components from the AE and then determine the ALP having regard to the mean profit margin of comparable cases at 8.26%.
Entitlement for the benefit of proviso appended to section 92C(2) - Held that:- As far as the second fold of submission is concerned, we remit this issue to the file of the Assessing Officer for re-adjudication. The learned Assessing Officer, after determination of any adjustment, if required to the value of the international transactions shall determine, whether the assessee is entitled for the benefit of proviso appended to section 92C(2). Since the learned TPO granted this benefit to the assessee with regard to the automotive component segment, it cannot be denied qua, this claim also, if the adjustment falls within the range provided in the proviso. The Assessing Officer shall look into these aspects and if so require can take the help of the TPO.
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2014 (11) TMI 1035
Penalty u/s 271(1)(c) - furnishing inaccurate particulars of income in respect of deduction claimed u/s 10B - CIT(A) deleted penalty - Held that:- This is a fact that the Tribunal has set aside the disallowance made by the AO in respect of which penalty u/s 271(1)(c) was levied and has allowed the claim of the Assessee u/s 10B. In view this fact, we do not find any illegality or infirmity in the order of CIT(A). We accordingly confirm the order of CIT(A) deleting the penalty levied u/s 271(1)(c). - Decided in favour of assessee
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2014 (11) TMI 1034
Penalty u/s 271(1)(c) - disallowance of deduction claimed u/s 80IB - Held that:- The assessee has claimed deduction u/s 80IB in respect of profit derived from its industrial undertaking, which included deduction on account of export incentive also in the form of duty drawback, in the original return of income filed on 31.10.2004. Such a claim was reiterated in the return filed in response to notice u/s 153A on 17.08.2009. Once the assessee has not offered any income in consequence of search, in the return of income nor any such income was found as a result of search, there is no question of application of Explanation-5A, as held by the Ld.CIT(A). He has decided the issue entirely on wrong footing. In any case, at the time of filing of return of income, the assessee’s claim was based on auditor’s report and certificate in Form no. 10CCB. Such a claim was thus, non only based on bona fide belief but also prior to decision of Liberty India, which was rendered only on 31.08.2009. Earlier there were certain decisions which were in favour of the assessee. Even the Tribunal’s decision in assessee’s case for the A.Y. 2003-04, came after the date of filing of return of income for the A.Y. 2004-05. Thus, it cannot be held that assessee has furnished any inaccurate particular of income at the time of filing of return of income - Decided in favour of assessee
Inclusion of undisclosed income in its return filed u/s 153A - Held that:- Statement of Shri Ashok M. Seth, Executive Director of the company was also recorded u/s 131 during the course of survey u/s 133A, which was carried out simultaneously and explained the contents of impounded material and its implication in the books of account. Base on the seized documents, an income of ₹ 49,21,666/- was offered as undisclosed income. This amount was included in the return of income filed on 17.08.2009, in response to notice u/s 153A dated 06.07.2009. After including this income the total income was shown at ₹ 6,21,05,765/-. In the assessment order, the assessing officer had discussed specifically the related seized documents and the amount of interest/incentives which was received in cash and, found to be not recorded in the books of account. The declaration made by the assessee had been accepted by the assessing officer in the order passed u/s 143(3) r.w.s. 153A, dated 31.12.2010.
There are no exception clauses for immunity from penalty u/s 271(1)(c), and to this extent, Explanation 5A is in contradistinction with Explanation 5, which was applicable for searches prior to 01.06.2007. In Explanation 5, there were two exceptions provided in clause (i) and (ii). If the cases fell within the said exceptions, then no penalty is leviable. Such exceptions have not been provided in Explanation 5A. All the case laws which have been referred by the assessee, pertain to exception clauses provided in Explanation-5. Here in this case admittedly the search has taken place after 01.06.2007 and the return of income for the A.Y. 2008-09 had fallen due much before the date of search. In the return of income filed prior to the date of search, the income of ₹ 49,21,666/- was not included by the assessee. The additional income which has been declared after the date of search was in the return of income filed u/s 153A and not earlier. Thus in our view Explanation-5A is clearly attracted and the penalty levied by the AO u/s 271(1)(c) has rightly been confirmed by the Ld.CIT(A). Accordingly, the grounds raised by the assessee is dismissed and the assessee’s appeal for A.Y. 2008-09 is dismissed. - Decided against assessee
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2014 (11) TMI 1033
Reopening of assessment - Disallowance under section 43B being the amount of interest on loan converted into equity shares of the appellant pursuant to one time settlement with the lender bank - Held that:- Section 43B per se does not provide the manner in which the payment of interest is to be made, it only provides that the deduction is allowable on the sum payable mention in clauses (a) to (f), if such sum is actually paid by the assessee. The said section creates fiction that certain liabilities, irrespective of the method of accounting followed by the assessee, would be allowed as deduction only on actual payment. The clause (d) of the said section covers interest payment to the banks. The interest payment has to be made in cash or in actual terms of money has not been specified. The only rider given in Explanation 3C is that, interest payable is allowable when the interest is actually paid and it should not be converted into loan or borrowings. There is no prohibition or embargo that the sum actually paid will not cover payments through allotment of shares. The shares are tradable commodity and has a value which can be sold in the market as per the value of the share on the date of sale. It is easily convertible into money as and when required.
Once there is no such prohibition u/s 43B for discharging the payment of interest liability and claiming of deduction thereof, by converting the payment through allotment of shares, then how the assessing officer sans any legal provision or any judicial authority could have entertained “reason to be believe” that such a deduction is not allowable. On these facts we are of the opinion that the “reasons” as recorded by the AO, do not clothe him with the jurisdiction u/s 147 to reopen the completed assessment. No legal provision or legal proposition has been brought to our notice in support the ground raised by the assessing officer in the “reasons recorded” for reopening the case. Thus on such “reasons”, we hold that the reopening u/s 147 cannot be validly initiated, as prima facie there is no ‘reason to believe’ that any income chargeable to tax has escaped assessment. The very initiation of proceeding u/s 147 by issuance of notice u/s 148 is thus bad- in- law and accordingly the same is held and null and void. - Decided in favour of assessee.
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2014 (11) TMI 1032
Noticeably, the Assessing Officer during the course of the proceedings under Section 153A/C of the Income Tax Act, 1961 was informed about the amalgamation, which resulted in dissolution of the respondent-assessee, but no remedial or effective steps were taken.
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2014 (11) TMI 1031
Penalty u/s 271AAA - CIT(A) deleted the penalty - Held that:- Even if we were to go along with the stand of the Assessing Officer that the credit for the seized cash could be given for tax liability only after completion of assessment yet it follows that the assessee has paid tax with interest as required by clause (iii) of sub-section (2) of section 271AAA of the Act. The phraseology of clause (iii) of sub-section (2) of section 271AAA of the Act is pari-materia with the third condition in clause (2) of Explanation 5 to section 271(1)(c) of the Act; and, therefore following the ratio of the judgement of the Hon'ble Supreme Court in the case of Gebilal Kanhaialal HUF (2012 (9) TMI 297 - SUPREME COURT ), the CIT(A) made no mistake in holding that assessee has fulfilled the condition of clause (iii) of sub-section (2) of section 271AAA of the Act and accordingly the penalty levied by the Assessing Officer has been justifiably cancelled. - Decided in favour of assessee.
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