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Showing 261 to 280 of 590 Records
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2011 (10) TMI 522
Issues:
1. Confirmation of penalty under section 271(1)(c) of the Income-tax Act for disallowance of expenses claimed out of export sales.
2. Confirmation of penalty under section 271(1)(c) of the Income-tax Act for excess deduction claimed under section 80HHC.
Analysis:
1. The appeal pertained to the confirmation of a penalty under section 271(1)(c) of the Income-tax Act regarding disallowance of expenses claimed out of export sales. The assessee had claimed expenses amounting to Rs. 96,37,692 out of total export sales, alleging payment to a company for engineering work. However, investigation revealed the expenses were falsely claimed to reduce taxable income. The Tribunal referred to a previous case where a similar claim was allowed in full, indicating the expenditure was for business purposes. Consequently, the penalty related to this addition was deleted as no concealment was found.
2. The second issue concerned the penalty for an excess deduction claimed under section 80HHC of the Income-tax Act. The original claim of Rs. 39,77,265 was revised to Rs. 32,49,470 due to a calculation error. The assessee argued that the revision was based on known facts and figures, with no intent to conceal information. The authorized representative highlighted discrepancies in the calculation and contended that the revision was logical and did not amount to furnishing inaccurate particulars. Citing a relevant case law, the Tribunal held that there was no concealment of facts and directed the deletion of the penalty. The penalty for the excess deduction claim under section 80HHC was deemed wrongly levied, and the appeal of the assessee was allowed accordingly.
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2011 (10) TMI 521
Issues Involved:
1. Addition of Rs. 35,39,200 in respect of excess stock discovered during survey proceedings.
2. Addition of Rs. 4,59,392 in respect of labour charges expenses.
3. Estimated ad hoc disallowance of Rs. 11,00,000 out of sales promotion expenses.
4. Estimated ad hoc disallowance of Rs. 3,50,000 out of stationery expenses.
5. Addition of Rs. 15,408 in respect of excess cash alleged to be worked out during the survey proceedings.
Issue-wise Detailed Analysis:
1. Addition of Rs. 35,39,200 in respect of excess stock discovered during survey proceedings:
The appellant, a Hindu undivided family engaged in the business of manufacturing and trading gold and silver ornaments, was subjected to a survey on January 19, 2007, revealing discrepancies in the stock of gold and diamond ornaments. A statement by Shri Nirav J. Soni, son of the karta, acknowledged the excess stock and agreed to pay taxes on the additional unaccounted income of Rs. 40 lakhs, which was later retracted. The appellant filed a return declaring an income of Rs. 38,57,100 and retracted the earlier disclosure through an affidavit, claiming the stock had been reconciled. The Assessing Officer noted discrepancies in stock registers and deemed the excess stock as unexplained investment under section 69B of the Income-tax Act. The Commissioner of Income-tax (Appeals) affirmed the Assessing Officer's action, questioning the delay in retraction and the failure to produce customers for cross-examination. The Tribunal remanded the issue back to the Assessing Officer for de novo consideration, directing verification of the stock of diamond ornaments and the reconciliation of stock discrepancies.
2. Addition of Rs. 4,59,392 in respect of labour charges expenses:
This issue is connected to the first ground, where the Assessing Officer taxed the labour charges separately, considering them part of the excess stock. The Commissioner of Income-tax (Appeals) confirmed this addition. Since the excess stock issue was remanded for fresh consideration, this ground was also allowed for statistical purposes, to be decided afresh in consequence.
3. Estimated ad hoc disallowance of Rs. 11,00,000 out of sales promotion expenses:
The assessee claimed Rs. 24,28,780 towards sales promotion, significantly higher than the previous year's Rs. 11,44,972. The Assessing Officer disallowed Rs. 11,00,000, doubting the reliability of the books of account. The Commissioner of Income-tax (Appeals) upheld this disallowance. The Tribunal, however, found that the expenditure was business-related and fully vouched, reversing the findings of the authorities below and allowing the expenditure.
4. Estimated ad hoc disallowance of Rs. 3,50,000 out of stationery expenses:
The Assessing Officer made an ad hoc disallowance of Rs. 3,50,000 out of Rs. 4.40 lakhs claimed for stationery expenses, noting a significant increase from the previous year's Rs. 42,078. The Commissioner of Income-tax (Appeals) affirmed this disallowance. The Tribunal found that the assessee maintained proper accounts and supporting bills, directing the deletion of the ad hoc disallowance.
5. Addition of Rs. 15,408 in respect of excess cash alleged to be worked out during the survey proceedings:
This ground was not seriously pressed by the appellant and was dismissed.
Conclusion:
The Tribunal allowed the appeal partly, remanding the issues of excess stock and labour charges for fresh consideration, while allowing the claims for sales promotion and stationery expenses. The addition of excess cash was dismissed as not pressed. The order was signed, dated, and pronounced on October 14, 2011.
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2011 (10) TMI 520
IRDA - Enhancement of the insurance premium - opportunity of hearing the petitioners/appellants - jurisdiction of the 1st respondent to issue a notification – Held that:- powers of the 1st respondent under Section 14(2)(i) of the Insurance Regulatory and Development Authorities Act (herein after referred to as the 'IRDA Act') and that before issuing Ext.P2, draft was published in the web site on 4.1.2011 inviting responses from the persons interested, following which there were series of discussions with Transporters Association and Insurers. As regards the enhancement, it was found that the 1st respondent had conducted studies and evolved a formula for the revision of rights based on settled parameters as set out, namely, average claims cost for each class of vehicle, frequency of claims for each class of vehicle and Cost Inflation Index for the year of review - Writ Petitions were dismissed
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2011 (10) TMI 519
Arbitration and Conciliation Act, 1996 - Bye Law 248 - Arbitration claim – non-payment of the amounts due - appellant and the first respondent are members – first respondent alleged that appellant and second respondent are sister concerns - Held that:- Bye-law 248 applies to a dispute between a member and a non-member, yet a claim by a member against another member can be entertained by an arbitral forum constituted under Bye-law 248, where said claim is incidental or connected with a claim against a non-member, in the present case, First respondent cannot claim amount from appellant - Second respondent was liable as claimed by the first respondent, but the appellant was not liable only on the ground that the arbitrators appointed by the Stock Exchange under Bye Law 248, in a claim against a non-member, had no jurisdiction to decide a claim against another member
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2011 (10) TMI 518
Recovery of Debts Due to Banks and Financial Institutions Act, 1993 - Condonation of delay – appeal against order passed by Debts Recovery Tribunal - application filed under section 5 of the Limitation Act for condonation of delay – period of limitation – Held that:- delay cannot be condoned on ground of equity and hardship - application for condonation of delay in preferring an application under section 30(1) of RDDBFI Act beyond period of 30 days prescribed under said provision can be allowed by Debts Recovery Tribunal (DRT) by exercising power to condone delay as understood under section 5 of Limitation Act - provisions of section 5 of Limitation Act or its principles are not applicable to appeal filed under section 30 of RDDBFI Act – application dismissed
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2011 (10) TMI 517
Banking Regulation Act, 1949 - Audit of public sector banks – discontinuance of Statutory Central Auditors ('SCAs') on complaint filed by Bank - involvement of RBI in appointment and discontinuance of a Statutory Central Auditor (SCA) in public sector banks is meant to ensure a degree of protection to SCA, which is expected to discharge its professional duty fearlessly and independently – Held that:- RBI could not have arrived at the decision without some kind of an inquiry - Allegations concerning the competence and integrity of an SCA, selected by the RBI through a fairly rigorous process, cannot be permitted to be made lightly and equally accepted on face value without some probe by the RBI. Otherwise it might be easy for a bank to have an inconvenient SCA discontinued - Considering that the accounts of public sector banks are to be audited by employing the best possible standards, the RBI was under a statutory obligation to ensure that the discontinuance of the Petitioner, on a complaint about its professional competence, was preceded by a proper procedure comporting with the principles of natural justice - decision of the RBI, as communicated in its letter dated 24th June 2009 to the PNB, to discontinue the Petitioner as an SCA, even for the limited extended period ending 30th June 2009, was violative of the principles of natural justice and was, therefore, illegal
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2011 (10) TMI 516
Transfer of shares – alleged that respondents have removed their name without sufficient cause and without due compliance of the provisions of law and entered the name of respondent No. 3. From - family settlement and the transfers have taken place pursuant to the said family settlement – Held that:- Respondents have not complied with the provisions of law in respect of transfer of shares most probably on the basis of family settlement. Whatever may be the reason, the share transfers must be done in accordance with law and with mutual consent and accepted procedure - Any transfer of shares without compliance of section 108 is void and illegal the same should be set aside - R1-company directed to rectify the register of members by incorporating the name of the petitioner
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2011 (10) TMI 515
Writ petition - Territorial jurisdiction - cancellation of shares - prayer of the respondent-company made before the Company Law Board, Delhi for cancellation of those shares, respondent have registered office at Shillong – Held that:- mere fact that the respondent No. 2 has its registered office at Shillong or carries on its business at Shillong has absolutely no bearing on whether the shares allotted by it in the year 2001-02, is legal or not. No part of the cause of action of the company petition pending before the Company Law Board at Delhi lies within the territorial jurisdiction of this Court. As this writ petition is being dismissed on the ground of its non-maintainability. Writ petition dismissed.
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2011 (10) TMI 514
Winding up - Official Liquidator seeking direction to furnish names of legal representatives of deceased director – whether Company Judge is justified in granting to bring legal representatives of deceased respondent no.1 and of one of his legal heirs to be brought on record in Company Application – Held that:- No prejudice to the interest of the legal representatives of deceased Durgaprasad or deceased Vithaldas in the matter - mere grant of permission vide impugned order to bring them on record does not mean and cannot be construed to mean that any of their defences are in any way vitiated or prejudiced. Company Court is free to consider all these defences after the relevant material is brought on record in inquiry as per law
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2011 (10) TMI 513
Winding up - Powers of Court under section 466 of the Companies Act, 1956 – stay on winding up proceedings – applicants are promoters of the company - applicants pray that the assets and properties of the company in liquidation be handed over to them and the Official Liquidator to stand discharged – Held that:- it is apparent that the applicants do not desire to revive the business of the company in liquidation by developing part of its properties or portions of its lands, but desire to take over the said lands for exploitation in the real estate market - It is clearly their motive that these lands should be taken over without offering the market price, but via this application so that once the permanent stay of winding up is obtained or granted, that would mean that the company's prime assets and properties can no longer be controlled by the Court - They would develop these lands by constructing buildings and sell off the units therein and earn profits - none of the grounds enabling exercise of discretion under section 466 have been made out, this company application is dismissed
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2011 (10) TMI 512
Winding up - Transfer of share – contributor or not - applicant-Poddar Finance is holding equity shares of M/s Jaipur Spinning and Weaving Mills Ltd. and the aforesaid shares were acquired from Shree Shakti Mills Limited on 25.1.1979 - applicant contended that in terms of section 428 of the Companies Act, 1956, the holder of fully paid up shares is deemed to be a contributory – Held that:- Petition for winding-up of Shakti Mills was filed on 25.4.1978 and shares in question were transferred thereafter on 10.5.1979. Transfer of shares in question in terms of section 536(2) after commencement of winding up proceedings of Shakti Mills is void. Since the transfer of shares in question is void in view of section 536(2) of the Act, the applicant-Poddar Finance cannot be treated to be a contributory.
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2011 (10) TMI 511
winding up – preferential payment - compensation payable to the workmen or their dependents in the case of an unfortunate event of losing life by the workmen – whether claim of secured creditors, the claim of the workmen should to be satisfied on pari passu basis – Held that:- workmen's dues as defined in sub-section (3) (iii) to Section 529 of the Act, will not include the compensation awarded under the Workmen's Compensation Act prior to the sale of the assets of the company. The measures introduced by Section 529-A, cannot be extended to abate the claim of the dependants of the deceased workmen. The Act gives priority of payment in terms of Section 14-A of the Act. - Appeal allowed.
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2011 (10) TMI 510
Reduction of share capital - buy-back of the shares under Section 77A of the Act - reduction of share capital has to be done on proportionate basis in accordance with Section 77A(5) of the Act – Held that:- conditions precedent in Section 77A (5) of the Act are applicable only to buy-back of shares under Section 77A of the Act. Consequently, Section 77A(5) of the Act does not apply to a Scheme of Reduction under Section 100 of the Act, as the two operate in entirely different fields - reduction of share capital is a commercial and business decision, which has been approved by 99.999% of equity shareholders of petitioner-company and only 0.0020% of shareholders are opposing - no valid reason for not accepting the proposed scheme of reduction of share capital.
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2011 (10) TMI 509
SEBI - offences punishable under Section 24(1) and 27 - accused company was operating collective investment scheme and raised a huge amount from the general public in contravention with the SEBI Act and Regulations - allegations against its Directors and promoters who were not arrayed as an accused were that the accused through its promoters/Directors who are the persons in-charge and responsible for the day-to-day affairs of the company and all of who actively connived with each other for the commission of the offence - petitioners as directors of company were summoned - Petitioners sought quashing of proceedings pending against them – Held that:- Section 27 of the SEBI Act makes responsible all other Directors of the company who are responsible and in-charge of the day-to-day affairs of the company, however in a case of conspiracy number of people can be involved and this is the allegation of the Respondent in the complaint - Petition and application are dismissed
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2011 (10) TMI 508
Whether the CHA and other services availed for export of the goods can be taken as credit by the manufacturers of the goods treating the same as input service - Held that: there are some decisions which do not allow credit of service tax paid on CHA services holding that the services availed in the port area are not input services for the manufacture of goods - It is the undisputed policy of the Government not to burden the export goods with domestic taxes as has been noted in various decisions of the Tribunal - the Government under Notification No.17/2009-ST dated 7.7.2009 has since granted exemption to various taxable services provided to an exporter. CHA services are also exempted under Sl. No.11 to the Table annexed to the said Notification. The present cases have arisen apparently in the absence of exemption notification for the previous period. The only way freeing export goods from domestic taxes can be ensured for the period relevant to these appeals is to allow credit of the service tax paid on the CHA and other services in respect of the export consignments so that the exporter would be compensated either by utilization of such credit for payment of other taxes or by taking refund when such utilization is not possible - Appeal is allowed
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2011 (10) TMI 507
Condonation of delay - Held that: Tribunal's order in the case of CCE, Tirunelveli Vs. Ramesh Enterprises (2010 - TMI - 205301 - CESTAT, CHENNAI - Service Tax), it has been held that in service tax matters, the Commissioner (Appeals) has the power of remand the lower appellate authority while condoning the delay has not examined in his order as to when the order in original was received by the respondents, when the appeal was filed before him and whether the period of delay was within the condonable limit or not - Appeal is allowed by way of remand
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2011 (10) TMI 506
Waiver of pre-deposit - pure agent - reimbursable expenses - Demand has been confirmed on brokerage - Held that:- as regards demand of brokerage, the assessees have made out a strong prima facie case for unconditional waiver in the light of the Tribunal's order in Lee & Muir Head Pvt. Ltd. Vs Commissioner of Service Tax, Bangalore reported (2008 - TMI - 32881 - CESTAT, BANGALORE - Service Tax)
As regards other activities, assessees have not made out a prima facie case for total waiver in the light of the finding of the Commissioner that as regards banking commission, professional fees, additional expenses for the crane charges and labour mamool, the importer or the exporter is not liable to pay the charges to the respective service providers and further no supporting documents or bills were produced by the assessees in respect of the above mentioned expenses
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2011 (10) TMI 505
Waiver of pre-deposit - Time limitation - royalty as renting of immovable property - MOU dated 1.2.2002 - held that:- party was admittedly enjoying the benefit of renting of immovable property. - That period is after 1.6.2007 and, therefore, for the present purpose, we would consider "renting of immovable property service" having been provided by the appellant to the second party under the aforesaid MoU. - We would also consider the so-called 'royalty' as rent collected by the appellant from the other party. These parameters appear to constitute "renting of immovable property service" rendered by the appellant to the other party during the period for which consideration was collected by the appellant. On merits, therefore, the appellant has no prima facie case. - considerting the issue of extended period of limitation pre deposited ordered for demand within normal period of limitation.
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2011 (10) TMI 504
Service Tax valuation - reimbursement of expenses - pure agent - CHA services - During the course of audit of accounts of the said assessee, it was noticed that, in addition to service charges for the Customs House Agents service, the assessee has collected various charges under different headings and did not include the same for determining the value of CHA services - Learned advocate appearing for the assessee contended that in respect of expenses under certain heads, the Commissioner has failed to consider the factual submissions including sample documents which were submitted from time to time, as required by the department and also the entire documents submitted in 'CD' and disallowed the claim for exclusion - The assessee claims that, on the basis of documents already submitted to the Commissioner, they will be in a position to demonstrate that they are eligible for abatement of these expenses and other expenses referred to in para 8 of the Commissioner's order as towards that of "Pure Agent" - Held that: the documents have been produced by the assessee on different occasions and that there was a change in adjudicating authority and, therefore, possibly there was communication gap in correlating the documents in support of the claim of the assessee - Appeals are allowed by way of remand
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2011 (10) TMI 503
Service tax on sub contractor - The appellant is a service provider registered with the service tax department for services under the categories of Maintenance or Repair, Consulting Engineering etc - Held that: assessees have now produced certificate dt. 9.11.2010 from the main contractor that they had paid service tax on the amount received by them from CPCL, as sub-contractor. This document could not be produced either before the adjudicating authority or the lower appellate authority due to strained relationship between the assessee and the main contractor - Appeal is allowed by way of remand to adjudicating authority
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