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Showing 261 to 280 of 1393 Records
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2021 (2) TMI 1135
TP Adjustment - payment made towards SAP ERP implementation - HELD THAT:- Cost paid by the assessee for implementation of SAP ERP system without any mark–up cannot be treated as nil by applying the benefit test. It is for the assessee to decide whether a particular system or investment would be beneficial to him or not. The Transfer Pricing Officer certainly cannot step into the shoes of the assessee or the Assessing Officer to evaluate the business expediency of a cost incurred for business purpose and the benefit derived. His job is to determine the arm's length price by adopting any one of the prescribed methods.
In the facts of the present case, though, the Transfer Pricing Officer has stated that he has adopted CUP method for determining the arm's length price, however, in reality, he has determined the arm's length price at nil on purely ad–hoc basis by stating that the assessee has not derived any benefit. Moreover, the allegations of the Transfer Pricing Officer and learned Commissioner (Appeals) that the assessee has failed to furnish supporting evidence to establish its claim is found to be baseless as the assessee has furnished sufficient documentary evidences not only to prove the implementation of SAP ERP system but also the benefit derived by it from such system. Moreover, when the Transfer Pricing Officer has accepted the payment made towards SAP ERP implementation in the earlier years, there is no reason to deny the same in the current year by determining the arm's length price at nil.
In any case of the matter, it is a fact on record that the assessee has implemented the SAP ERP system and is utilizing it for its business purpose. The Transfer Pricing Officer has also stated that SAP ERP system is a necessary tool for carrying out business works. That being the case, the determination of arm's length price at nil, that too, on ad–hoc basis is unsustainable. Accordingly, we have no hesitation in deleting the addition made on account of transfer pricing adjustment.
Disallowance u/s 14A - disallowance of interest expenditure under rule 8D(2)(ii) - HELD THAT:- No interest disallowance should be made when the assessee has surplus interest free fund available with it. Secondly, only those investments which have yielded exempt income during the year should be considered for disallowance under rule 8D(2)(iii).
On a perusal of impugned order of learned Commissioner (Appeals), we find that the assessee had made a submission that as against the interest free surplus funds available of ₹ 281,90,44,000, investment stood at ₹ 150,85,55,000 - assessee had sufficient interest free fund available with it to take care of the investment. Therefore, as per the settled legal principles, no disallowance of interest expenditure can be made under rule 8D(2)(ii). Hence, the disallowance made under rule 8D(2)(ii) has to be deleted. As regards disallowance of administrative expenditure under rule 8D(2)(iii), we direct the Assessing Officer to compute such disallowance by taking into account only those investments which have yielded dividend income during the year. In this regard, the Assessing Officer is directed to verify the correctness of disallowance computed by the assessee at ₹ 3,91,961.79. This ground is disposed off accordingly.
Disallowance u/s 43B - leave encashment paid - HELD THAT:- We find that while deciding the issue in assessee’s own case for the assessment year 2007–08, the Tribunal [2016 (5) TMI 1546 - ITAT MUMBAI] has restored the issue to the Assessing Officer for fresh adjudication. Facts being identical, following the aforesaid decision of the Co–ordinate Bench, we restore the issue to the Assessing Officer for fresh adjudication. Ground is allowed for statistical purposes.
Disallowance of depreciation claimed on the WDV of the royalty expenditure - HELD THAT:- We find that the royalty expenditure incurred by the assessee in the assessment year 2001–02 was held to be of capital in nature. However, the Tribunal directed the Assessing Officer to allow depreciation on such expenditure. Therefore, when depreciation has been allowed to the assessee on the expenditure incurred on royalty in the preceding assessment years, consequential benefit of depreciation has to be allowed to the assessee in the impugned assessment year as well. The ground raised by the assessee is allowed.
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2021 (2) TMI 1134
Penalty u/s 271(1)(c) - Addition u/s 43B - Assessee voluntarily offered to tax the outstanding MVAT and sales tax liability as its income - HELD THAT:- We find that learned CIT(A) is totally wrong in holding that just because 43B liability is shown by tax audit report penalty has to be fastened upon the assessee.
The assessee has furnished all particulars there is no concealment or furnishing of inaccurate particular of income. Just because assessee's claim is not accepted the same does not ipso facto lead to levy of penalty. Similarly, there is small difference between 26AS and income returned. This is also very minor and the assessee does not deserve to be visited with the rigour of penalty. We are of the considered opinion that assessee's conduct is not contumacious and his claims are not mala fide. Hence, assessee should not be visited with rigour of penalty. Accordingly, we set aside the orders of the authorities below and delete the penalty. Appeal filed by the assessee stands allowed.
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2021 (2) TMI 1133
Levy of penalty u/r 15(1) of Cenvat Credit Rules, 2004 - suppression on the part of the assessee or not - allegation is that assessee have not come out with full and proper details before the Revenue authority at first instance - input - MT HDT Feed - HELD THAT:- No case of imposition of penalty under Rule 15(2) of Cenvat Credit Rules, 2004 is made out. Further cogent explanation given by the assessee have not been found wrong in the impugned adjudication order.
It has been held by the Hon’ble Bombay High Court in Commissioner of Central Excise, Pune-II Vs. Ajinkya Enterprises [2012 (7) TMI 141 - BOMBAY HIGH COURT], that payment of duty on output/finished goods amounts to reversal of Cenvat credit taken on inputs.
Appeal dismissed - decided against Revenue.
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2021 (2) TMI 1132
Penalty u/s 271G - assessee failed to furnish documents as required under the Rule 10D(1) and sub-section (3) of the section 92D in respect of the international transactions entered into by it - HELD THAT:- Respectfully follow the view taken by the Tribunal in the case of Navinchandra Exports Pvt. Ltd. [2017 (11) TMI 1307 - ITAT MUMBAI] wherein it was observed that considering the practical difficulties involved in furnishing the segmental details of AE transactions and non-AE transactions in the diamond industry, penalty under Sec. 271G could not be justifiably imposed. Before parting, we may herein observe, that the Tribunal in its aforesaid order had observed that considering the reasonable cause for non-furnishing of the segmental details of the AE transactions and non-AE transactions because of the peculiar nature of the trade in diamond industry, penalty u/s. 271G even otherwise could not have been imposed as per the mandate of Sec. 273B.
No infirmity emerges from the order of the CIT(A) who had rightly vacated the penalty imposed by the TPO under Sec. 271G - Decided against revenue.
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2021 (2) TMI 1131
Ex-parte assessment order by AO and CIT-A - HELD THAT:- The present case it is an admitted fact that the A.O. passed the assessment order ex parte and the Ld. CIT(A) also passed the impugned order ex parte . It is noticed that the Ld. CIT(A) mentioned in the impugned order that various notices were issued to the assessee but there was no compliance and that the latest notice was issued on 07/08/2018 for compliance on 14/08/2018. Nothing is brought on record to substantiate that the notices issued either by the A.O. or by the Ld. CIT(A) were served upon the assessee. It is well settled that nobody should be condemned, unheard as per the maxim, "audi alteram partem".
We therefore keeping in view the principles of natural justice deem it appropriate to set aside this case back to the file of Ld. A.O. to be adjudicated afresh in accordance with law after providing due and reasonable opportunity of being heard to the assessee.
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2021 (2) TMI 1130
Waiver of pre-deposit - Application for early hearing - Can there be any ground for early hearing to be granted when the appellants/counsel for appellants, have them sought adjournment to the hearing of application for early hearing for more than six months? - HELD THAT:- It is quite evident that the appellants/counsel for the appellants are only seeking adjournments to avoid the hearing on this application for early hearing.
Country is facing the pandemic situation on account of COVID-19, and the tribunal is hearing the matter in virtual mode, whereby the counsel has not even to travel upto the premises of this tribunal for hearing in the matter and can attend the hearing from the comfort of her residence/office. Also we find that Annexure 1 (prescribing PROCEDURE FOR E-HEARING OF APPEALS BY CESTAT) to Public Notice No 02 of 2020 Regarding E-Hearing Dated 10.08.2020 issued by the Registrar CESTAT - The casual approach on the part of appellant/appellant’s counsel in attending the hearing in virtual mode in the present case is quite apparent, and the adjournment of nearly six months sought upto now itself goes contrary to the request for early hearing of the appeal.
There are no merits in the application made as the same is not supported by any documents of financial hardship etc. Further how can there be any financial hardship in view of the provisions of Section 35F - the application for early hearing is dismissed - the appeal should be listed in normal course.
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2021 (2) TMI 1129
Addition towards excess stock - GP estimation - HELD THAT:- As examined the trading account of the assessee split in two parts, i.e. before survey and after survey. If the amount of surrender of ₹ 5.76 lakh is excluded, the rate of gross profit in both the periods comes to roughly 17% each. In order to bring down the value of closing stock as on the date of survey from market price to cost price, the amount of gross profit is required to be unloaded from the market price taken by the survey team for ascertaining the excess value of stock purchased by the assessee. If such gross profit rate of 17% is applied to the market value of stock determined by the authorities as on the date of survey to ₹ 27.08 lakh, a reduction in the value of stock would be warranted to the tune of ₹ 4,60,360/- for finding out its cost price to the assessee. This amount of ₹ 4.60 lakh is, therefore, directed to be excluded from the addition of ₹ 8,81,692/- made and confirmed by the authorities in this regard.
Addition being difference in cash as per cash book and physical cash found at the time of survey - HELD THAT:- The survey team counted physical cash and tallied it with the cash in hand as per cash book. There was excess cash of ₹ 73,228/- which was accepted by the assessee as an additional income, but not offered for taxation in the return of income. The assessee made up the cash book later on to present that there was no difference. However, nothing of this sort was stated at the time of survey that the cash book was not complete or certain transactions were omitted to be recorded.Contention of the assessee for the acceptance of books of account produced after the date of survey, cannot be countenanced. Thus, the resultant addition on account of excess stock is hereby confirmed.
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2021 (2) TMI 1128
Estimation of income - Bogus purchases - HELD THAT:- As relying on M/S BECON CONSTRUCTIONS PVT. LTD. VERSUS ACIT, CENTRAL CIRCLE-8, NEW DELHI [2020 (12) TMI 988 - ITAT DELHI] we are of the view that Assessing Officer should retain the addition @ 9.25%. Appeal of revenue partly allowed.
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2021 (2) TMI 1127
Reopening of assessment u/s 147 - notice issued u/s.148 before expiry of time limit for issue of notice u/s.143(2) - HELD THAT:- Respectfully following decisions of CIT Vs M/s.Qatalys Software Technologies Ltd. [2008 (7) TMI 240 - MADRAS HIGH COURT] and in the case of CIT vs. K.M Pachayappan [2007 (7) TMI 229 - MADRAS HIGH COURT], we are of the considered view that notice issued u/s.148 dated 23.09.2016, before the expiry of time limit for notice u/s.143(2) for the impugned assessment year is invalid and thus, consequent reassessment order passed u/s.143(3) r.w.s. 147 is null and void. Hence, we quash reassessment order passed by the Assessing Officer. - Decided in favour of assessee.
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2021 (2) TMI 1126
Maintainability of advance ruling application u/s 245R - TDS u/s 192 - Applicant' a company incorporated in India seconds its employees from time to time on long term assignment to other BMW Group entities in various countries such as Germany. Japan, etc, under the terms of Reimbursement Agreement - Residential Status of the employees with whom the Applicant had made transactions - Whether transaction or issue was designed prima facie for avoidance of income tax? - salary of seconded employees - taxes were already paid by the employees in the host country - ruling on allowability or eligibility of claiming a credit to avoid double taxation - HELD THAT:- In Order to claim such bar under clause (iii) of Section 245R(2), there must be some necessary facts pointing to prima facie inference to a design to avoid tax by any illegal or improper means. No such fact has been brought on record by the revenue.
Obligation of the Applicant to deduct TDS under section 192 - As per the split payroll arrangement, part of the salary of the seconded employees was paid in India. The Applicant was deducting tax on such part salary paid in India. The Applicant has approached the Authority in respect of its obligation to deduct tax on salary paid to such employees for the years in which they qualify as non-resident in India and for taking credit for tax deducted in foreign country in their year of return to India. We, therefore do not find any merit in the objection raised of the Revenue that the transaction was designed prima facie for avoidance of tax. When the Applicant is merely enquiring about its obligation to deduct TDS or otherwise under section 192 of the Act, it cannot he said that the transaction was for avoidance of tax.
The objection of the revenue that there was no clarity of the residential status of the seconded employees is also not correct. There residential status con be ascertained from the period of stay outside India as mentioned in Annexure-I of the application - The revenue has contended that such credit can be taken only by the concerned employees and not by the Applicant as tax-deductor. The objection of the Revenue is on merit of the question which needs to be examined and decided upon in the course of merit hearing. These have no impact on admission of the case as they do not establish that the transaction was designed for avoidance of tax. Similarly, the objection of the revenue that the Applicant was bearing tax on foreign salary of such employees is also not a material fact to decide the admission of the case. In fact this issue has not been raised in the present application and the revenue is free to examine the matter on its merit.
In view of the above facts and discussions we do not find any merit in the objection of the Revenue that the transaction or issue was designed prima facie for avoidance of income tax. Accordingly. the objection or the revenue is rejected. application is admitted under section 245R(2)
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2021 (2) TMI 1125
Arrest under section 69 of the Central Goods and Services Tax Act, 2017 - offence of availing ineligible Input Tax Credit - out of the alleged availing of ineligible Input Tax Credit of slightly more than ₹ 9 crores, petitioner No.1 has deposited ₹ 4.80 crores which is more than 50% of the alleged dues - HELD THAT:- It is directed that no coercive action shall be taken against petitioner Nos. 2 to 8 till the next date. However, petitioner Nos.2, 7 and 8 shall appear before the investigating authority as summoned on 26.02.2021 at 11:00 a.m. and thereafter as and when summoned. Rest of the petitioners shall appear before the investigating authority as and when summoned and co-operate with the investigation.
Stand over to 16.03.2021 for filing of reply and rejoinder.
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2021 (2) TMI 1124
Notice/summons issued by the Central Tax Authority whereas adjudication u/s 74 had been made by the State Authority - contention is that once the Central Tax Authority had initiated action, the proceeding was required to be brought to its logical end by the same authority - HELD THAT:- It appears from the perusal of the order dated 8th September, 2020 that the show cause notice had been served under Section 74(2) of the Act and the date was fixed for submitting explanation/objections by the petitioner. The order impugned dated 8th September, 2020 records that the petitioner did not appear before the proper Officer - As the proceedings for determination and levy of tax and penalty had been initiated by the State Tax Authority, this Court does not find substance in the challenge to the jurisdiction of respondent no. 2 to pass order for determination of tax and penalty to levy the same upon the petitioner, in view of the circular dated 5.10.2018.
In the considered opinion of the Court, the initiation of the proceeding for imposition of tax and penalty was with the issuance of the notice under Section 74 as contained in Chapter XV of UPGST Act and the inquiry under Section 70 of the Act was independent - It goes without saying that all issues being raised by the petitioner herein including the issue of non-service of notice before passing the order under Section 74 of the Act shall have to be adjudicated by the appellate authority without being influenced by any of the observations made.
Petition dismissed.
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2021 (2) TMI 1123
Refund of Education Cess and Secondary & Higher Secondary Education Cess - benefit under N/N. 39/2001-CE dated 31.7.2001 availed - period from January-2007 to May-2007 - HELD THAT:- The judicial discipline also would require to give effect to the order of the higher appellate authorities and not to once again initiate the actions of recovering the very refund claim, which has been given to the petitioner after a long drawn battle.
Issue Notice for final disposal, returnable on 8.3.2021. Interim relief in terms of paragraph 18.B. is granted, till the returnable date. Learned Central Government Standing Counsel, Mr.Parth Divyeshvar waives service of Notice for and on behalf of the respondent No.1.
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2021 (2) TMI 1122
Scope of two SCN - different subject matter in both SCN - Sabka Vishwas (Legacy Dispute Resolution) Scheme (SVLDRS), 2019 - petitioner contends that since the contracts of the petitioner with CIPL were the subject matter of the first show cause notice, the second show cause notice with respect to “free of cost” supplies under the contract with CIPL and/or with respect to constitution of NOIDA does not constitute a different matter but is the same matter - HELD THAT:- Though it is also the contention of the counsel for the petitioner that in any case, qua “free of cost” supplies there is no taxation element as held in COMMISSIONER OF SERVICE TAX ETC. VERSUS M/S. BHAYANA BUILDERS (P) LTD. ETC. [2018 (2) TMI 1325 - SUPREME COURT] has been held to be a corporation and thus the said questions are no longer res integra but we are of the opinion that in the challenge at this stage, we are not required to go into the merits of the grounds urged in the impugned show cause notice.
The counsel for the respondents seeks time to show case law on, how the words ‘same matter’ or ‘different matter’ are to be interpreted in the context of the SVLDRS i.e. liberally or restrictively.
List on 15th March, 2021.
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2021 (2) TMI 1121
Profiteering - Section 171 of the Central Goods and Services Act, 2017 (CGST Act) and Rules contained in Chapter XV of the central Goods and Services Rules, 2017 - HELD THAT:- Issue notice.
Notice is accepted by the counsel for the respondents - Subject to the petitioner paying the entire demanded amount, less the GST amount already deposited, in six equal monthly instalments commencing from the month of February, 2021, there shall be stay of recovery.
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2021 (2) TMI 1120
Refund sought of on amount deposited - petitioner was compelled to deposit amount with the respondents and though the said amount was deposited as far back as on 1st July, 2020 and 31st August, 2020 but the respondents are merely retaining the said amount and have not taken any further action - Provisional attachment of Bank Account of petitioner - Section 83 of the Central Goods and Services Tax (CGST) Act, 2017 - HELD THAT:- It appears that the respondents were required to issue notices under Sections 73 and/or 74 of the Act to the petitioner and which the respondents have not done till now. It prima facie appears that the respondents, taking advantage of the petitioner having been so compelled to make the deposit, albeit without prejudice to its rights and contentions, are not in a hurry.
Thus, unless the respondents issue notice, within a time bound period, a direction needs to be issued for refund of the amounts so deposited by the petitioner; if the notices are issued, further remedy thereagainst would be available to the petitioner - counsel for the respondents seeks time to obtain instructions.
List on 5th March, 2021.
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2021 (2) TMI 1119
Cancellation of registration of selling dealer - submission of petitioner is that at the time of purchase of goods/stocks, the registration of the selling dealer was valid - HELD THAT:- Matter requires consideration.
Learned counsel for the petitioner submits that 10% of the disputed tax liability has been deposited in terms of Section-107(6) of the Act, the appeal before the Tribunal (when constituted) would be maintainable upon deposit of 20% of the remaining tax amount. The petitioner is willing to deposit that amount - Learned Standing Counsel has accepted notice on behalf of State-respondents. He prays for and is granted four weeks' time to file counter affidavit. Petitioner shall have two weeks thereafter to file rejoinder affidavit.
List thereafter.
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2021 (2) TMI 1118
Seeking reconsideration of declaration of the petitioner filed under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - eligibility of the petitioner or maintainability of its declaration to avail the benefits of the scheme under the category of investigation, enquiry or audit on the ground that the service tax dues of the petitioner for the related period was not quantified on or before 30th June, 2019 - HELD THAT:- The issue decided in the case of THOUGHT BLURB VERSUS UNION OF INDIA AND ORS. [2020 (10) TMI 1135 - BOMBAY HIGH COURT] where it was held that petitioner was eligible to file the application (declaration) as per the scheme under the category of enquiry or investigation or audit whose tax dues stood quantified on or before 30th June, 2019.
In the present case, Petitioner has stated that it received the email of the said letter dated 15.06.2019 on 29.06.2019 and the physical copy on 01.07.2019. Respondents have taken the stand that because the physical copy was received by the petitioner on 01.07.2019 the quantification would be construed to have been done on 01.07.2019 which was beyond the cut off date of 30.06.2019, thus rendering the petitioner ineligible. In our view, such a construction does not conform to the letter and spirit of the scheme as we have discussed above. The scheme talks about quantification of the tax dues and not communication thereof. The quantification having been done vide letter dated 15.06.2019, receipt of copy thereof whether email or physical becomes immaterial. It is the date of quantification which is relevant because in this case the quantification has been done by the authority. That apart, it was clarified by the Board that since 30.06.2019 was a public holiday being a Sunday, therefore, in terms of section 10(1) of the General Clauses Act, 1897 the relevant date should be considered as 01.07.2019 instead of 30.06.2019.
Allegation that the letter dated 15.06.2019 did not indicate complete quantification as per letter of the Anti Evasion Wing dated 20.11.2019 - HELD THAT:- In the present case, there is a clear demand made by the respondents upon the petitioner and there is no reason not to accept the said figure as the amount of service tax dues payable by the petitioner for the period under consideration.
Opportunity of personal hearing - HELD THAT:- The declarant had accepted the determination of tax dues by the designated committee and thus there was no question of providing any personal hearing because no such hearing would be required. In fact in Form SVLDRS No.2A, it is found that the same is a form pertaining to written submissions, waiver of personal hearing and adjournment under section 127 of the Finance (No.2) Act, 2019 read with Rule 6 of the Sabka Vishwas (Legacy Dispute Resolution) Scheme Rules 2019. From a perusal of the said form, we find that the petitioner had clearly mentioned that it agreed with the estimate made in SVLDRS Form No.2. In such circumstances, the question of availing any personal hearing did not arise.
The rejection of the declaration of the petitioner was not justified - matter remanded back to the respondents (designated committee) to consider afresh the declaration of the petitioner dated 13.11.2019 as a valid declaration in terms of the scheme under the category of investigation, inquiry and audit and thereafter grant the consequential relief(s) to the petitioner. Petitioner shall be afforded an opportunity of hearing where-after a speaking order shall be passed - petition allowed by way of remand.
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2021 (2) TMI 1117
Provisional attachment of Bank Accounts - Section 83 of the CGST Act - petitioner submits that the attachment of the bank accounts has brought the entire functioning of the company to a standstill, as the Petitioner is unable to dispense salary to approximately 15000 employees and discharge statutory dues like EPF, ESIC and labour welfare schemes etc. - HELD THAT:- Issue notice. Mr. Satish Aggarwala, SPP accepts notice on behalf of respondents and submits that he would like to take instruction and file short affidavit/ status report within one day.
List on 24th February, 2021.
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2021 (2) TMI 1116
Dishonor of Cheque - conviction under Section 138 of Negotiable Instruments Act, 1881 - debt payable to the complainant present or not - misuse of cheque - Section 357(3) of Cr.P.C. - HELD THAT:- The learned courts below have given consistent finding in favour of the opposite party no. 2 that the cheque was issued in discharge of debt.
This court finds that the learned courts below have given consistent finding of facts after due appreciation of the evidences on record and have rightly held the petitioner guilty of offence under Section 138 of Negotiable Instruments Act, 1881. This court also finds that the basic ingredients of offence under Section 138 of Negotiable Instruments Act have been satisfied in the present case and accordingly, the judgement of conviction of the petitioner does not call for any interference in revisional jurisdiction of this Court - this Court fully agrees with the learned counsel appearing on behalf of the opposite party no. 2 that there is no scope for re-appreciation of evidence in revisional jurisdiction and coming to a different finding in absence of any perversity. This Court finds that no perversity as such has been pointed out by the learned counsel appearing on behalf of the petitioner.
The sentence of the petitioner is modified by limiting it to the period already undergone by the petitioner in custody and impose fine of Rupees one lakh upon the petitioner over and above the compensation amount which has already been fixed by the learned court below with a further condition that the petitioner would deposit the fine amount alongwith the compensation amount before the learned court below within a period of two months from the date of communication of this order. If the amount is not so deposited within the said period, the petitioner would serve the sentence already imposed by the learned trial court.
This petition is disposed of with modification of sentence.
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9911796707
