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Showing 241 to 260 of 1484 Records
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2025 (3) TMI 1244
Maintainability of petition when efficacious statutory alternative remedy of appeal under section 35F of the Central Excise Act, 1944 (the CEA Act, 1944) is available to the petitioner - HELD THAT:- The Apex court in the case of Hindustan Coca Cola Beverage Private Limited Vs. Union of India and others, [2014 (9) TMI 585 - SUPREME COURT] has held that when a statute provides for statutory appeal, the said remedy is to be availed by the litigating parties.
In the case of Hameed Kunju vs. Nazim [2017 (7) TMI 1414 - SUPREME COURT], the Apex Court has held that any petition under Article 227 of the Constitution of India should be dismissed in limine where there is statutory provision of appeal.
The Apex court in the case of Ansal Housing and Construction Ltd. Vs. State of Uttar Pradesh and others [2016 (3) TMI 1435 - SUPREME COURT], has held that when statutory appeal is provided then the said remedy has to be availed.
In the case of Godrej Sara Lee Ltd. [2023 (2) TMI 64 - SUPREME COURT], the Apex Court has held that High Court can only interfere in the matters when disputed question of law are involved and not in the question of facts. In the present case, no disputed question of law is involved. In the present case, it is evident that sufficient opportunity of hearing through virtual mode was provided to the petitioner on 28.11.2024, 13.12.2024, 20.12.2024 & 27.12.2024 but neither the petitioner nor his authorised representative attended the personal hearings on the above dates. Thus, the contention of the petitioner with regard to non-grant of opportunity of personal hearing is contrary to the record and is hereby rejected.
Conclusion - The petitioner's writ petition is not maintainable and the same is dismissed, granting the petitioner the liberty to pursue the alternative remedy of appeal as provided under the Central Excise Act, 1944.
Petition disposed off.
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2025 (3) TMI 1243
Process amounting to manufacture or not - job work activities - liability to pay excise duty despite the principal manufacturers not filing the necessary declarations as per N/N. 214/86 CE - onus to prove - invocation of extended period of limitation - penalties under Rule 25 of the Central Excise Rules, 2002, read with Section 11AC of the Central Excise Act, 1944.
HELD THAT:- It is a cardinal principle of adjudication that the adjudicating authority has a bounden duty to address the contentions raised in the reply to show cause notice and pass an order either accepting the contentions or reject them, while stating reasons for the decision so taken. Indisputably the aforesaid contentions of the appellant, raised before both, the adjudicating authority and the appellate authority, has not elicited any rebuttal from both of them. Without specifically rebutting the contentions, merely the fact that the appellant is engaged in manufacturing parts of Motor Vehicle & Speedometer, parts of Power-Driven Pumps, parts of Textile Machinery & parts of Press Tools cannot lead to any automatic assumption that the job worked goods are also such parts as the onus is on the Revenue to prove that the appellant has indeed manufactured dutiable goods.
The Honourable High Court of Bombay in the case of Annapurna Engineering Corpn v ACCE, Div-I Nagpur [2010 (9) TMI 369 - BOMBAY HIGH COURT] has held that failure to pass a reasoned order resulted in miscarriage of justice. While we would have ordinarily remitted the matter back for denovo adjudication, given the efflux of time of nearly a decade and the quantum of revenue involved, we think that this is a fit case where the indolence of the adjudicating and appellate authorities ought not to result in protracting the litigation for the appellant for no fault of the appellant and instead the benefit ought to enure to the appellant.
A coordinate bench of this Tribunal in its decision in Southern Plywoods v CCE (Appeals), Cochin [2009 (2) TMI 331 - CESTAT, BANGALORE], have found that non consideration of all the submissions of the appellant and passing the orders without discussion thereon renders the order liable to be set aside. Accordingly, we hold that the impugned OIA is liable to be set aside on this ground alone.
It is not the case of the Revenue that the goods cleared by the appellant are further not utilised by the principal manufacturers in their manufacture, rather it has been found that the goods received from the job worker (i.e. the appellant) are further used in the manufacture of parts of motor vehicles, pumps, machineries etc. The denial is solely on the ground that on enquiry with the jurisdictional ranges of the Principals it is found that the Principal manufacturers have not filed declarations under the said notification 214/86 CE ibid.
Extended period of limitation - HELD THAT:- The appellate authority has upheld the invoking of extended period of limitation as a natural corollary of non payment of duty and incorrect adoption of valuation which came to the knowledge of the department only through scrutiny by Audit. The said finding, is not in consonance with the requirement of statute. In the absence of any positive evidence let in by the department of wilful suppression of facts or misstatement with intent to evade payment of duty, the invocation of extended period is untenable, more so when the appellant were under the bonafide belief that their activity does not amount to manufacture as they were only clearing semi-finished goods manufactured out of the raw materials supplied to them by the principal manufacturer and clearing the same to the principal manufacturer - even otherwise the demand is substantially also barred by limitation.
Conclusion - i) The procedural lapses by principal manufacturers should not negate substantive benefits to job workers. ii) The invocation of the extended period of limitation requires explicit evidence of wilful suppression, which was absent in this case. The demand is barred by limitation.
Appeal allowed.
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2025 (3) TMI 1242
Justification in demanding duty by allowing the valuation of the goods manufactured by the appellant job worker, in view of the amendment to Rule 10A of the Central Excise Valuation Rules, 2000 - HELD THAT:- The facts not in dispute are that the Appellants had been engaged by M/s.Marico Ltd. (hereinafter referred to as the Principal Manufacturer) for the purpose of job work and the Appellants had manufactured the impugned goods out of the raw materials supplied by the principal manufacturer. The appellants had cleared the goods to the principal manufacturer who in turn had captively consumed the goods for further manufacture. The appellants had adopted the value comprising the cost of materials used and conversion charges following the principles laid down by the Apex Court in the case of Ujagar Prints Ltd [1989 (1) TMI 124 - SUPREME COURT].
Admittedly, the FAA has applied Rule 10(A)(iii) in the case on hand to hold that the valuation as prescribed thereunder would apply for determination of the value of the excisable goods. He thus upholds the demand of duty, but however, penalties imposed by the original authority in respect of both the appeals are set aside. The appellant here-in has challenged the duty demand confirmed against them, while the revenue has accepted the deletion of penalties on these appellants.
Conclusion - The valuation of goods manufactured on a job work basis should align with the Supreme Court's ruling in Ujagar Prints, which considers the cost of materials and conversion charges.
The impugned orders in appeal cannot sustain insofar as the duty demand which is challenged in these appeals is concerned - Appeal allowed.
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2025 (3) TMI 1241
CENVAT Credit - input services or not - services provided by call centres - services used for 'sales promotion' or not.
As per P. K. Choudhary, Member (Judicial)
HELD THAT:- From the bare reading of the definition of ‘Input Service’, as defined under Rule 2(l) of the Cenvat Credit Rules, 2004, it is clear that, the definition is divided into two parts, i.e. (i) Means- Clause and (ii) Inclusive- Clause. Further, vide Notification No. 3/2011-CE (NT) an Exclusion-Clause was included in the definition. The services excluded were Construction Service, Rent-a-Cab Service, General Insurance Service for motor vehicles and Repair Service. The Cenvat credit in relation to these services is allowable either to certain service providers only or on the satisfaction of certain conditions. Furthermore, the services that are used primarily for personal use or consumption of any employee like outdoor catering, beauty treatment, health services, cosmetic and plastic surgery, membership of a club etc. are also excluded from the definition of the input services.
In the present case, the Appellant is receiving the service of Call Centres which helps in building brand image of the Appellant which ultimately leads to sale of the final products. Such sale being the goal of undertaking the activity of manufacture and the aforementioned services having been received in relation to sale of the final product manufactured by the Appellant, can be said to have been used in relation to manufacture of the final product of the Appellant. Hence, they qualify as an input service. The services in relation to 'Sales Promotion' have nexus with the manufacturing activity as sale is the most logical conclusion of manufacturing activity and any effort made to boost the sale is bound to influence the manufacturing. Therefore, credit in question is admissible to the Appellant.
There is no provision in the format of the ER-1 Returns to mention the amount of Cenvat credit availed under each service category or transaction-wise. Only the total availment of Cenvat credit is required to be reflected in the return. Therefore, the finding that the Appellant did not inform the Department of such availment of Cenvat credit on the said services is unsustainable.
Suppression of facts or not - demand of interest and penalty - time limitation - HELD THAT:- The present case involves interpretational issues involving complex legal provisions to determine the correct admissibility of Cenvat credit. It is a settled position that a case involving interpretation of the statutory provisions cannot be construed to be a case of wilful misstatement or suppression of facts, with intent to evade payment of tax or avail Cenvat credit in a fraudulent manner.
As per Section 11AC of the Act read with Rule 15 of Cenvat Credit Rules, 2004 the penalty can be imposed only in cases of fraud, collusion, wilful misstatement or suppression of facts or contravention of provisions of Excise Act with an intention to evade payment of duty. There are no ingredient to indicate that the Appellant contravened any provisions of law as they did not avail any credit in contravention of any provisions of law.
According to Rule 14 read with Section 11AA, interest is chargeable only when any duty of excise has not been levied or paid or has been short levied or short paid or erroneously refunded or Cenvat credit has been erroneously taken and utilized. The situations contemplated under Rule 14 as well as under Section 11AA are absent in this case. Therefore, where the demand of Cenvat credit is itself liable to be set aside, as a necessary consequence, interest is also not payable.
The impugned order is set aside and appeal is allowed.
As per Sanjay Srivastava, Member (Judicial)
CENVAT Credit of input services - services provided by call centres - sales promotion services or not - HELD THAT:- In respect of input services there is no requirement for admissibility of credit that services should received within the registered manufacturer/premises of the appellant till the time loose nexus can be established between the use of the services directly or indirectly in relation to output goods being manufactured by the appellant. The credit in such cases need not be denied.
Issue has been decided by Hon’ble Bombay High Court in the case of M/s Coca Cola India Pvt. Ltd. [2009 (8) TMI 50 - BOMBAY HIGH COURT] where it was held that 'It is therefore, clear that the burden of service tax must be borne by the ultimate consumer and not by any intermediary i.e. manufacturer or service provider. In order to avoid the cascading effect, the benefit of cenvat credit on input stage goods and services must be ordinarily allowed as long as a connection between the input stage goods and services is established. Conceptually as well as a matter of policy, any input service that forms a part of the value of the final product should be eligible for the benefit of Cenvat Credit.'
The services of ASC and DSC availed by the appellant definitely go to enrich the value of the output goods cleared by them by creating a brand image for the appellant. Hence, in terms of the Rule 2(l) of Cenvat Credit Rules, exists between the said services and the goods being cleared by the appellant. There are no merits in the order denying the Cenvat credit in respect of these services.
As the demand is being set aside, penalties imposed and demand for interest is also set aside.
Conclusion - i) The services provided by call centres qualify as input services under Rule 2(l) of the Cenvat Credit Rules, 2004, as they are related to sales promotion and brand building, which are integral to the manufacturing process. ii) There are no evidence of fraud or suppression by the appellant, and thus, penalties and interest were not justified.
The impugned order cannot be sustained - appeal allowed.
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2025 (3) TMI 1240
Entitlement for the benefit of ITC as claimed under the provisions of U.P. Value Added Tax Act read with the corresponding provisions of Section 16 as well as Section 140(1) of the GST Act read with Rule 21(1)(y) of the Value Added Tax Rules - entitlement to the benefit of I.T.C. to the dealer when the business has been discontinued by the dealer on 30.06.2017.
Whether after introduction of new GST Act from 01.07.2017, the registered dealers were entitled for the benefit of unutilized ITC accrued under the UP VAT Act though having closing stock?
HELD THAT:- Under the VAT Act, the food-grains were exempted on its purchase, subject to certain conditions and the same were liable to be taxed on its sale. The benefit of ITC can only be availed on fulfillment of certain conditions as contemplated under section 13(1)(a) of the VAT Act. The unutilized ITC has to be debited or carried forward as per the sub-sections of section 13 of the VAT Act. Similar view has been expressed under rule 21(1) of the Rules.
Perusal of section 13(1)(a) of the VAT Act clearly demonstrates that the earned ITC can be utilized on the sale, subject to the conditions as mentioned in the table. The ITC can only be claimed on fulfillment of certain conditions as contemplated herein-above. Section 13(6) of the VAT Act and rule 21(1)(y) of the UP VAT Rules contemplate that in the event ITC is unutilized and the registered dealer discontinued its business and the closing stock is there, then the dealer has to debit the unutilized ITC. The registered dealer cannot be permitted to utilize earned ITC for the said period.
The case in hand, it is admitted between the parties that the opposite party has not sold the purchased goods and there was closing stock. Until & unless the last tax period of the assessment year during which business has been discontinued after adjustment of the tax liability by-passing the assessment order for such assessment year, if any excess amount of ITC is left, then only section 15(5) of the VAT Act will come into play and not otherwise - By plain reading of section 15 of the VAT Act, it is clear that the available ITC can only be refunded after passing of the assessment order for that assessment period in which the business was discontinued after adjustment of tax liability.
Once the opposite party – registered dealers, by operation of law, discontinued its business, it was the duty cast upon the opposite party dealer to debit their ITC as contemplated under section 13(6) of the VAT Act. The Tribunal has failed in its duty while allowing the appeal of the opposite party by overlooking the provision of section 13(6) of the VAT Act.
Conclusion - The Tribunal erred in allowing ITC benefits without adhering to the VAT Act's provisions, particularly section 13(6), and that the business was deemed discontinued by law, requiring ITC debiting.
The impugned judgements are set aside - All the revisions are allowed.
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2025 (3) TMI 1239
Removal of word ‘settlement’ used in the loan account statement as it may affect future loan facilities being availed by the appellant - apartments purchased by the appellants are ready and some minor work remains which the builder may complete forthwith and hand over possession to the appellants - builder has not issued acknowledgment of the payments made by the appellants - HELD THAT:- Considering the facts and circumstances of the case and the fact that upfront payment has been made by the borrower/appellants under orders of this Court, the loan account should be closed treating it as repaid or fully paid up.
The learned counsel appearing for the builder, upon instruction, stated that the possession would be handed over on or before 31.03.2025. This takes care of the second issue raised.
Conclusion - i) The Bank will accordingly make the necessary incorporations in their records. ii) As stated by Mr. Kadam, learned counsel for the builder, let possession of the apartments, fully completed in all respects as required under law, be handed over to the appellants on or before 31.03.2025. iii) With respect to the third issue, the amount having been paid by the appellants to the builder by way of Bank transfer, even if no receipt is issued, the proof of payment is certified by the Bank, but still, the builder is directed to issue acknowledgment in writing to have received the entire due amount. iv) One last thing which remains is that the Bank, which had initiated recovery proceedings before the Debt Recovery Tribunal or before any other Forum with respect to the loan in question of the four appellants, shall forthwith withdraw the same, in view of the loan having been satisfied in all the four cases. v) Further, appellant Ravi Agrawal or any other appellant who had initiated proceedings before the Real Estate Regulatory Authority shall withdraw such cases.
Appeal disposed off.
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2025 (3) TMI 1238
Dismissal of appeal preferred by the petitioner, dismissed as being beyond the limitation - case of petitioner is that while passing the order under section 73 of the GST Act, no hearing was granted - HELD THAT:- Standing Counsel, based upon the instructions, does not deny the fact that any date for hearing was fixed. The order impugned also does not reflect any hearing being granted to the petitioner.
Finding the same to be violative to Section 75(4) of the GST Act as well as in violation of Article 14 of the Constitution of India, the orders impugned cannot be sustained and are quashed. The matter is remanded to pass fresh order in accordance with law after giving an opportunity of hearing to the petitioner.
Petition allowed by way of remand.
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2025 (3) TMI 1237
Levy of GST - assignment of leasehold rights to a third party of a plot of land allotted by the Maharashtra Industrial Development Corporation (MIDC) to the original lessee (i.e. the assignor) along with the buildings constructed thereon, on payment of a lump sum consideration by the assignee to the assignor - HELD THAT:- The Division Bench of the Gujarat High Court in Gujarat Chambers of Commerce and Industry & Others V/S Union of India & Others [2025 (1) TMI 516 - GUJARAT HIGH COURT] has taken a view that the assignment by sale or transfer of leasehold rights of the plot of land allotted by the Gujarat Industrial Development Corporation (GIDC) to the lessee or its successor (assignor) in favour of a 3rd party (assignee) for consideration, shall be an assignment/ sale/ transfer of benefits arising out of “immovable property” by the lessee-assignor in favour of a 3rd party who would then become a lessee of GIDC in place of the original allottee-lessee. In such circumstances, the Gujarat High Court held that the provisions of Section 7 (1) (a) of the GST Act providing for scope of supply read with clause 5 (b) of Schedule II and clause 5 of Schedule III would not be applicable to such a transaction and the same would not be subject to levy of GST as provided under Section 9 of the GST Act.
In this Petition also the adjudication of the Show Cause Notice dated 13th November 2024 shall remain stayed.
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2025 (3) TMI 1236
Valid issuance of SCN or not - suppression of facts or not - refund for the tax period of October 2017 to March 2018 - HELD THAT:- As is manifest from a reading of the impugned SCN, it merely observes that the petitioner wrongfully claimed a refund by misrepresenting that the transactions in question would constitute an export of services. The Department asserts in the SCN that the services provided by the petitioner were intermediary services with the place of supply being in India and thus disentitling it from claiming a refund.
The Court in Parity Infotech [2023 (3) TMI 489 - DELHI HIGH COURT] had found that the SCN merely reproduced the statutory language of Section 74 without any tangible material or independent reasoning to support the allegation of fraud or misstatement. Consequently, the SCN was held to have been issued mechanically and thus the invocation of Section 74 being wholly unwarranted.
The Allahabad High Court has, in HCL Infotech Ltd. v. CCT [2024 (9) TMI 1644 - ALLAHABAD HIGH COURT], further clarified that in order to invoke the extended time period of five years under Section 74 of the Act, the SCN must clearly set out the specific acts of commission or omission on the basis of which an opinion may be formed that benefits had been claimed “by reason of” fraud, misstatement or suppression of facts.
Conclusion - The SCN appears to have been issued solely to avoid the inevitable consequences which flow from our decision rendered inter partes in the earlier round of litigation. It is opined that a claim for refund cannot be legally or justifiably stalled by the adoption of circuitous means as the present.
Petition disposed off.
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2025 (3) TMI 1235
Cancellation of the registration of the petitioner - statutory returns has not been filed for a continuous period of six months - petitioner is ready to pay any further taxes that may be due, along with late fee and interest, as required under GST Act - HELD THAT:- This Court has been consistently following the directions issued in Tvl.Suguna Cutpiece Center's case [2022 (2) TMI 933 - MADRAS HIGH COURT], where it was held that 'The petitioners are directed to file their returns for the period prior to the cancellation of registration, if such returns have not been already filed, together with tax defaulted which has not been paid prior to cancellation along with interest for such belated payment of tax and fine and fee fixed for belated filing of returns for the defaulted period under the provisions of the Act, within a period of forty five (45) days from the date of receipt of a copy of this order, if it has not been already paid.'
The benefit extended by this Court vide its earlier order in Suguna Cutpiece Center's case, may be extended to the petitioner.
Petition disposed off.
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2025 (3) TMI 1234
Withdrawal of petition - Seeking release of sanctioned loan - illegal seizure without affording the Petitioner a chance to be heard - violation of principles of natural justice - HELD THAT:- The respondent No.2 appearing on advance notice submitted that the instant petition is nothing but a gross misuse of process of law and the prayer no. d of the instant petition which is made by petitioner for issuance of directions to the GST-Department is baseless and does not have any grounds.
Accordingly, the instant petition may be dismissed, however, since the learned counsel appearing on behalf of the petitioners made an innocuous prayer to withdraw the instant petition and has not pressed the matter on merits, he has no objection for withdrawal of the instant petition.
The instant petition is dismissed as withdrawn with liberty as prayed for.
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2025 (3) TMI 1233
Treating the return filed as defective return u/s 139 (9) - petitioner has not filed the tax audit report as required u/s 44AB - HELD THAT:- If the petitioner can access the system of the respondents to download the impugned order, we fail to understand why the respondents cannot access the said order and reject the rectification application on the ground that the base order is not available. This requires a serious investigation into the IT system of the respondents because the said incompetency would be against the efforts of the Government for transmission to electronic mode of adjudication of the disputes under the Act.
Without going into the larger controversy, we direct the petitioner of the petition which is the order treating the return as invalid with respondent no.2 within one week from the date of uploading the present order. The petitioner is also directed to file a copy of ITR Form uploaded with the system of the respondents and the return which respondent no.1 has treated as defective.
On receipt of the petitioner filing above documents, respondent no.2 will dispose of the rectification petition filed by the petitioner vide letter dated 25 November 2024. The said rectification petition should be disposed of after giving petitioner an opportunity of hearing. The rectification order should be passed on or before 30 April 2025.
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2025 (3) TMI 1232
Addition of cash found during the search - whether Tribunal misdirected itself by sustaining the addition without giving a clear finding that the said amount was separate & different from the amount(s) declared by the Appellant in his returns for A.Y. 2005-06 and 2006-07? - HELD THAT:- Three authorities concluded that the Assessee could not co-relate the amount of cash seized with the amount noted in the documents.
ITAT also referred the Assessee’s statement about using code figures regarding his ‘consultancy fees’. Assessee accepted all these documents. In these circumstances, we cannot find fault with the concurrent findings recorded by the AO CIT (Appeals) and ITAT.
Addition was made on a substantive basis in the hands of Bharati Vidyapeeth and on a protective basis in the hands of the Appellant-Assessee. Since the addition in the hands of Bharati Vidyapeeth has been deleted, the addition in the hands of the Appellant-Assessee has been confirmed. This is not disputed by the Appellant-Assessee.
ITAT,has discussed the issue regarding this addition in great detail and quite correctly, has held that no case was made out to disturb the concurrent findings of fact recorded by the AO and CIT (Appeals).
The questions now proposed do not arise. In any event, the questions give rise to no substantial question of law.
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2025 (3) TMI 1231
Application for restoration of Income Tax Appeal which was allowed to be withdrawn or disposed - HELD THAT:- This appeal was instituted in 2013. At that time, instructions dated 9th February 2011 were in force. The exceptions in clause (8) of this Instruction did not include appeals on TDS issues. The exception regarding TDS issues was introduced only under Circular No. 5 of 2024, dated 15th March, 2024.
In V. M. Salgaocar and Brothers (P) Limited [2024 (12) TMI 717 - BOMBAY HIGH COURT] this Court has held that the exception in Circular No. 5 of 2024, dated 15th March 2024, cannot be applied retrospectively. The increased tax effect ceiling would apply even to pending appeals. Therefore, by following the reason in V. M. Salgaocar and Brothers (P) Limited [2024 (12) TMI 717 - BOMBAY HIGH COURT] this appeal was correctly withdrawn or disposed of as recorded in the order dated 25th October 2024.
Incidentally, the decision in V. M. Salgaocar and Brothers (P) Limited [2024 (12) TMI 717 - BOMBAY HIGH COURT] was followed in the context of the issue very similar to the one now raised in the case of The Principal Commissioner of Income Tax-23, Mumbai Versus M/s IPL Loan Trust [2025 (2) TMI 453 - BOMBAY HIGH COURT]
We decline restoration and maintain our earlier orders.
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2025 (3) TMI 1230
Validity of the notice issued u/s 274 r/w 271 - HELD THAT:- In CIT v. SSA’S Emerald Meadows [2015 (11) TMI 1620 - KARNATAKA HIGH COURT] the High Court of Karnataka following the decision in CIT v. Manjunatha Cotton & Ginning Factory [2013 (7) TMI 620 - KARNATAKA HIGH COURT] held that the imposition of penalty u/s 271 (1) (c) of the Act is bad in law and invalid for the reasons where the show cause notice u/s 274 of the Act did not specify the charge against the assessee as to whether it is for concealment of particulars of income or furnishing of inaccurate particulars of income
As show cause notice issued u/s 274 read with Section 271 of the Act did not furnish any particulars and all the relevant columns have been left blank. Thus, by applying the legal position in the aforementioned decision, this court has no hesitation to hold that the show cause notice was bad in law consequently the initiation of penalty proceedings is vitiated. Decided in favour of assessee.
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2025 (3) TMI 1229
Validity of reassessment proceedings - concurrent jurisdiction of JAO and the Faceless Assessing Officer (FAO) for issuance of the notices - whether the notices issued by Jurisdictional Assessing Officer (JAO) are to be declared invalid & bad in law, being in contravention of Section 151A read with Notification dated 29.03.2022? - HELD THAT:- FAO has been assigned specific jurisdiction and the Scheme dated 29.03.2022 also clearly indicates that the FAO has to be the jurisdictional authority. The opening of will not only lead to confusion, but will also result into a failure on the part of the Revenue, to give a concrete opportunity to the assessee. The concurrent jurisdiction of FAO and the JAO, if accepted, would defeat the very purpose of statutory provisions i.e. Sections 151A & 144B of the Act of 1961. The words carefully chosen by CBDT, include ‘automated allocation’, and the baseline for the same being ‘algorithm for randomized allocation’, clearly show that the technology was supposed to be used for the purpose of allocating jurisdiction to a random officer.
This Court is of the opinion that Section 151A of the Act of 1961 deals with the assessment, reassessment and re-computation provided in Sections 147 & 148 of the Act of 1961, and therefore, the same has to be faceless and the FAO has to have an exclusive jurisdiction to issue the notices.
The Scheme to the extent of Section 144B of the Act of 1961 for issuance of notice cannot be said to be relevant for the purpose of issuing notices under Section 147 & 148 of the Act of 1961. Sections 147 & 148 have been kept separately. The restrictions provided for the purpose of Section 144B shall be relevant
The legislative intention, legislative vision and legislative wisdom has to be given full meaning in terms of technology and progressiveness, and thus, once an effective and strong step has been taken towards faceless regime, then maintaining the strings of local control to the prejudice of a common man would not only undermine the legislative wisdom but the gains in terms of such a progressive and pragmatic step would stand to reduce. Once the gear of progress has been applied in a democratic set up, the same has to be strongly supported and sustained. The CBDT Circular read with Section 151A of the Act of 1961 has to be given full meaning and any ways & means to defeat the technology or to manually try to control the same would go against the legislative purpose.
Thus, this Court holds that the mandate of Section 151A of the Act of 1961 has to be strictly followed as there cannot be a way out of doing the same. This Court also holds that the JAO shall not have the jurisdiction to issue notices under Section 148 of the Act of 1961, as it would not only render Section 151A weak, but may also lead to its diminishing activation. For the purpose of assessment and reassessment under Sections 147, 148 & 148A and in light of the sanction under Section 151A, adherence has to be made to algorithm based random assessing system, and therefore, the impugned notices deserve to be quashed.
Consequently, the present writ petitions are allowed. Accordingly, the impugned Notices are quashed and set aside, as far as the jurisdiction of JAOs for the purpose of Sections 148 & 148A of the Act of 1961 to issue the same is concerned. The question raised herein stands answered in the terms indicated above, with liberty to the respondents to issue fresh notices in compliance of the CBDT Notification dated 29.03.2022, by keeping the FAO as assessing officer.
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2025 (3) TMI 1228
Stay on the recovery proceedings - requirement of paying 20% of the disputed demand - HELD THAT:- Department has followed the prescribed procedure in accordance with the provisions of the Income Tax Act, 1961 and the relevant CBDT instructions. The assessee has failed to comply with the mandatory requirement of paying 20% of the disputed demand, as stipulated under CBDT Instruction No.1914, dated 21.03.1996 and the Office Memorandum dated 31.07.2017. The documentary evidence produced by the assessee does not substantiate the claim of financial hardship to the extent required to justify non-payment of the disputed demand.
This Court is of the opinion that the Department has acted within its authority and the refusal to grant a stay on recovery proceedings is justified. The mere filing of an appeal before the Commissioner of Income Tax (Appeals) does not automatically entitle the assessee to a stay of the collection of the demand without fulfilling the pre-conditions as prescribed.
Writ Petition is dismissed. The assessee is directed to comply with the requirement of paying 20% of the disputed demand for the Assessment Year 2019-2020, in accordance with the relevant CBDT instructions and Office Memorandums.
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2025 (3) TMI 1227
Reopening of assessment u/s 147 - valid "reason to believe" - notice issued after expiry of four years - HELD THAT:- Assessee has paid taxes u/s 115JB of the Act in the return of income and has shown book profit u/s 115JB. Even the AO has assessed total income in the case of assessee as per the provision of section 115JB.
Furthermore, the petitioner was asked specific questions regarding cash credit received as well as sundry creditors along with Name, PAN, address, Copy of ITR and their confirmations. The petitioner had provided all the necessary details vide replies dated 15.12.2016 and 20.12.2016. The respondent thereafter being satisfied with the information supplied by the petitioner framed assessment under section 143 (3).
AO therefore, could not have assumed the jurisdiction to issue impugned notice u/s 148 of the Act and the impugned notice and the proceedings pursuant thereto cannot be sustained. Decided in favour of assessee.
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2025 (3) TMI 1226
Validity of assessment - change in jurisdiction in as much as earlier it was Faceless proceedings with NFAC but this time it was a notice from ACIT Cent-1, Rajkot without any prior notice or intimation of the order passed under Section 127 - petitioner was denied the principles of natural justice due to the lack of opportunity for a personal hearing through video conferencing.
HELD THAT:- As petitioner was never put to notice about the transfer of the case from NFAC to the Central Circle except stating the said fact in the show-cause notice dated 10th March, 2022 and it was left open for the petitioner to imagine that the case of the petitioner was transferred to Central Circle.
We are of the opinion that the contention raised on behalf of the respondent that as the case of the petitioner is transferred to the Central Circle, the provision of video conferencing/personal hearing is not available is contrary to the basic requirement of providing opportunity of hearing which would be in violation of the principles of natural justice.
The provisions of Section 144B of the Act applicable to the proceedings before NFAC provide for video conferencing and in view of such provision, the assessee would be left without any opportunity of hearing if the case of the petitioner is transferred to the Central Circle u/s 127 (2) of the Act.
The petition succeeds and is partly allowed. The impugned Assessment Order is hereby, quashed and set aside and the matter is remanded back to the AO to pass a fresh de-novo order after providing opportunity of hearing to the petitioner in compliance of the principles of natural justice.
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2025 (3) TMI 1225
Order passed u/s 264 - Whether the notice u/s 148 was validly served upon the late husband of the petitioner? - HELD THAT:- As on perusal of the impugned order passed under section 264 of the Act as well as the orders u/s 7 (1) of the RTI Act, it is not in dispute that notice under section 148 was never served upon late husband of the petitioner. Even notices under section 142 (1) of the Act was also not served and the petitioner came to know about the passing of the assessment order only when the bank accounts were put under lien for recovery proceedings.
In view of above undisputed facts when the notice under section 148 of the Act was never served upon the petitioner, the Assessing Officer could not have assumed the jurisdiction.
On bare perusal of section 264 of the Act, the respondent Commissioner of Income Tax has wide powers of considering the assessment order under revision as he may think fit or may make any such inquiry or cause such inquiry to be made subject to the provisions of the Act and pass such order thereon, not being an order prejudicial to the assessee as he thinks fit, meaning thereby that Commissioner while exercising the jurisdiction under section 264 of the Act, can look into the entire matter and after calling for record of the assessment proceedings under the Act, can make an inquiry or cause such inquiry to be made and thereafter subject to the provisions of the Act, pass an order which is not prejudicial to the assessee as he thinks fit.
The interpretation of section 264 of the Act by the respondent is contrary to the provision itself and the impugned order could not have been passed by resorting to such truncated interpretation of section 264 to limit the powers of the Commissioner to revise the order only on the ground of mistake or correction, if any, in the assessment order.
Petition succeeds and is accordingly allowed. The impugned order passed u/s 264 of the Act is hereby quashed and set aside and the matter is remanded to the respondent to pass a fresh denovo order under section 264 of the Act.
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