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Showing 281 to 300 of 1666 Records
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2017 (10) TMI 1389
Penalty u/s 271(1) - search procedure pursuant to notice issued u/s 153A - Held that:- ITAT had followed the ruling of this Court, in Principal Commissioner of Income Tax-19 v. Neeraj Jindal [2017 (2) TMI 1002 - DELHI HIGH COURT]. This Court notices that the judgment in Neeraj Jindal (supra) also was in the context of search in the same group of companies in which the assessee was the Director. As a consequence, the Court holds that there is no substantial question of law involved in this appeal which is accordingly dismissed.
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2017 (10) TMI 1388
Corporate insolvency proceedings - one meeting of the Committee of Creditors during 180 days of the period prescribed conducted - no Resolution Plan has been submitted - Held that:- From the record, it is clear that only one meeting of Committee of Creditors took place on 12th June 2017 and after that, no meeting of Committee of Creditors was held, and ultimately at the fag end of 180 days, Interim Resolution Professional has submitted his report that no Resolution Plan has been submitted. Since there is no recommendation of Committee of Creditors for extension of the time limit prescribed under the Rules, therefore, Corporate Debtor shall go under liquidation as per provision of Chapter-III of the Insolvency and Bankruptcy Code, 2016 read with Insolvency & Bankruptcy Board of India (Liquidation Process) Regulations, 2016.
Since the Resolution Professional, Shri Sandeep Kumar Gupta has conducted only one meeting of the Committee of Creditors during 180 days of the period prescribed, even though no Resolution Plan was under consideration, but he did not advertise the notice in the newspaper for inviting proposal from investors /creditor or any other person. Resolution Professional has not also taken consent of Committee of Creditors for being appointed as Liquidator.
On perusal of the record, it appears that the Corporate Debtor has filed this petition under section 10 of the Insolvency & Bankruptcy Code, 2016 for merely buying time. It also appears that RP has not taken proper steps for inviting Resolution Plan from investors and he submitted for further directions.
In the present case, we think it proper not to appoint Resolution Professional as Liquidator because he was appointed on the recommendation of the Corporate Debtor and he has not taken appropriate steps for completing the Resolution Plan. So, the request is being made to Insolvency & Bankruptcy Board of India for recommending a name of Resolution Professional for being appointed as Liquidator.
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2017 (10) TMI 1387
Rebate claim - time limitation - Section 11B of the Central Excise Act, 1944 - Held that:- The rebate claim could be submitted by the applicant only after export of the goods supported by all relevant documents to establish export of the goods and as per Section 11B of the Central Excise Act, 1944, it should have been lodged with the jurisdictional Assistant Commissioner within one year of the relevant date which is 7-1-2010 in this case - Thus the rebate claim should have been filed by the applicant by 6-1-2011. But the applicant has filed the rebate claim on 5-9-2011 which is undisputedly beyond the prescribed period of one year.
The contention that the time limitation is merely a procedural issue and not a substantive law is also not having any force as under Section 11B of the Central Excise Act, 1944, the time-limit of one year is a crucial condition and is not just a procedural requirement.
Decided against appellant.
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2017 (10) TMI 1386
Deduction u/s 80IC - assessee exhausted claim to extent of 100% eligible profit for five years’ period - assessee again claimed for 9th year of production by claiming substantial expansion of the unit in assessment year - Held that:- The assessee is the proprietor of Windsor Industries which is engaged in the business manufacturing and trading in EPS Thermocole Moulded Packaging Disposal Glass and BOPP Tapes at Baddi since 29.6.2004 and the initial assessment year for claim of deduction u/s 80IC was assessment year 2005- 06. The assessee has already claimed deduction under section 80IC to the extent of 100% eligible profit for five years’ period from assessment year 2005-06 to 2009-10.
The assessee had again claimed 100% deduction against eligible profit in the relevant assessment year 2013-14, which was 9th year of production by claiming substantial expansion of the unit in assessment year 2009-10. Relying upon the aforesaid decision of the ITAT in the case of Hycron Electronics (2015 (6) TMI 725 - ITAT CHANDIGARH), the claim was rejected by the lower authorities correctly - decided against assessee.
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2017 (10) TMI 1385
TPA - comparable selection criteria - Held that:- The assessee is a wholly owned subsidiary of Haworth Inc., USA. The assessee company is engaged in the business of manufacturing and trading of furniture (primarily chairs) thus companies functionally dissimilar with that of assessee need to be deselected from final list.
Exclusion of liabilities written back and bad debts recovered from operating margin of MSS segment - Held that:- The liabilities written back and bad debts recovered are part of operating income of the assessee. AR has pointed that similar disallowance was made in assessment year 2004-05 and the Commissioner of Income Tax (Appeals) allowed the claim of assessee. Thereafter, the Department has not agitated this issue before the Tribunal. We find that Delhi Bench of the Tribunal in the case of Sony India (P) Ltd. [2008 (9) TMI 420 - ITAT DELHI-H] has held that there is no justification for excluding provision written back in Profit and Loss account not forming part of operating profits.
Computation of arm's length price of Management Service Fee paid by assessee to AE - Held that:- The assessee has given the details of benefits derived by the assessee from the management service rendered by its AE Haworth Hong Kong Ltd. at page 282 of the paper book. The assessee has also filed additional evidence in respect of management services provided by its AE. In view of fresh evidence furnished by assessee, without commenting on the merits, we deem it appropriate to remit this issue back to file of Assessing Officer/TPO for de novo adjudication. The Assessing Officer shall consider fresh documents filed by assessee and all other relevant documents. The Assessing Officer shall also grant opportunity of hearing to the assessee before deciding the issue, in accordance with law. Accordingly, ground No. 7 raised in the appeal by assessee is allowed for statistical purpose.
Modification in selection of comparables under Manufacturing Segment - Held that:- TPO had made no adjustment in respect of manufacturing segment. DRP has also not commented on this issue. We observe that the findings of TPO on this issue are cryptic. We are of considered opinion that this issue requires revisit to TPO/Assessing Officer for fresh adjudication. The TPO is directed to pass a speaking order after affording opportunity of hearing to the assessee while adjudicating this issue, in accordance with law. Accordingly, ground No. 8 raised in the appeal by assessee is allowed for statistical purpose.
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2017 (10) TMI 1384
Curtailment of deduction claimed under section 10A - Deduction claimed u/s 10A by invoking the provisions of section 10A(7) r.w.s. 80IA(10) - assessee was providing high end Design Engineering Services to its associated enterprises and was being remunerated on Man Hourly rate basis, which has been computed applying the CUP methodology - Held that:- The assessee in its Engineering Design Development Services which was STPI unit shown net profit margin of 68.02%. The international transactions undertaken by the assessee with its associated enterprises in which PLI was 205% by taking OP/OC was accepted by the TPO to be at arm's length and no adjustment was made in the hands of assessee with regard to said division.
AO however, was of the view that the assessee had earned more than ordinary profits in the Engineering Design Services division and consequently, curtailed the deduction claimed under section 10A of the Act.
Where the Department has failed to prove that there existed an arrangement between assessee and its associated enterprises to earn more than ordinary, there is no merit in the aforesaid curtailment of deduction under section 10A of the Act. In this regard, we place reliance on the ratio laid down by the Hon’ble Bombay High Court CIT Vs. Schmetz India Pvt. Ltd.[2015 (6) TMI 1044 - BOMBAY HIGH COURT] where the SLP filed has been rejected by the Hon'ble Supreme Court. We also place reliance on the ratio laid down in Honeywell Automation India Ltd. Vs. DCIT [2017 (3) TMI 1533 - ITAT PUNE] and in assessee’s own case relating to assessment year 2006-07. Hence, grounds of appeal Nos.3 to 8 are allowed.
Transfer pricing adjustment made by the Assessing Officer with respect to provision of Customer Support Services - comparable selection - Held that:- Where the concern is providing KPO services, then the same is not comparable to the assessee, which is engaged in ITES services. Concerns operating in different business model than the assessee in the year under consideration, the same needs to be excluded from the final set of comparables
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2017 (10) TMI 1383
Denying the exemption u/s. 80P - assessee society is a bank and is hit by the provisions of sub-section (4) of section 80P - Held that:- As during the course of hearing we had called for the financial statements of the assessee from which it is clear that there is income in the form of interest on investments of ₹ 1,11,84,095 and commission income of ₹ 24,02,183 indicating that the respondent-society had dealings with the other non-members. Furthermore, the fact that the co-operative society had paid commission to Pigmi agents of ₹ 1,70,46,946 goes to indicate that it has accepted deposits even from non-members. These aspects need to be examined thoroughly in the light of the judgment in the case of The Citizen Co-operative Society Ltd. v. ACIT [2017 (8) TMI 536 - SUPREME COURT]. Therefore, we remand this issue back to the file of the AO for de novo assessment on the above lines. - Appeal filed by the revenue is allowed for statistical purposes.
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2017 (10) TMI 1382
Detention of goods - levy of one time tax and compounding fees - respondent suspected the nature of transaction that there is a likelihood of disposal of the imported goods within the State of Tamil Nadu and the concern with office at Kottivakkam being not registered in the Tamil Nadu - Held that:- Petitioner has placed necessary records to show that the consignment left customs barrier and reached Pondicherry in the same vehicle and adequate proof has been shown that the equipment is now with the petitioner. Thus, merely because the address of the notified party is in Chennai cannot be a sole reason to disbelieve the contention raised by the petitioner especially when the petitioner has been able to produce sufficient records to establish the genuinity of their transaction.
The detention notice and consequential compounding order are completely not sustainable - petition allowed.
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2017 (10) TMI 1381
CENVAT Credit - input service - Courier Service which are used for sending documents, samples, finished goods etc. - Held that:- Courier service used for sending documents, samples, finished goods, etc. is held to be an input service as defined under Rule 2(l) of CCR,2004 by this Tribunal in the case of M/s Hylden Glass Ltd. vs CCE & S.T. Vadodara I, [2017 (8) TMI 1217 - CESTAT AHMEDABAD] and the service tax paid on such service is eligible to CENVAT Credit - credit allowed - decided in favor of appellant.
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2017 (10) TMI 1380
Claim of depreciation on public roads - as per department that the National Highway is not road, in that view of the matter, the same will not be governed by the Schedule of Appendix-I and they will not be entitled for the expenses under the capital account - Held that:- While considering the matter, we have to go by the common parlance of road where public at large has an access. The assessee was granted license for construction against which he has right to use and collect license fee to use of the land. In that view of the matter, he has right to restrict the people without non payment of toll tax.
If we look at the definition which is given under the Income Tax Act, even a development made while occupying the premises and development of a road was the main agreement MOU referred by us.In view of written submissions submitted by Mr. Ranka, it is not only road, they have to construct toll booth and provide facilities for the staff for the purpose of their accommodation.
In that view of the matter, the Supreme Court judgment which is sought to be relied upon by the department in Challapalli Sugars Ltd. V. CIT [1974 (10) TMI 3 - SUPREME COURT] will not apply and the tribunal has rightly interpreted the change in law and more particularly under the law which has been inducted after year 1983. Thus, on the first issue, we are in complete agreement with the view taken by the tribunal in allowing the claim of depreciation on public roads treating the same as building. - Decided against revenue
Claim of depreciation on EDP Equipments - @ 60% OR @ 15% - treated as physical structures OR computers - Held that:- The contention which has been raised that equipment which are attached with the power equipment are not entitled under item no.5 of Schedule-I, in view of the fact that note 7 will not cover complete equipment which are attached with the system but in our considered opinion the optical fibers which are used exclusively for the computer configuration and it is mandatory for the operation. It is part of computer system. In that view of the matter, the view taken by the tribunal is just and proper.- Decided against revenue
Disallowance under 43B(f) - Held that:- We find that the Hon’ble Calcutta High Court has struck down section 43B(f) being arbitrary, unconscionable and de hors the Apex Court decision in the case of Bharat Earth Movers [2000 (8) TMI 4 - SUPREME COURT]. This judgment was duly brought into the notice of the ld. CIT(A). CIT(A) without taking note of the ratio laid down by the Hon’ble Calcutta High Court proceeded to sustain the finding of the AO. CIT(A) has recorded the fact that the AO has disallowed the claim as per provisions of section 43B(f) of the Act and it has been struck down by the Hon’ble Calcutta High Court. In our considered view, the ld. CIT(A) was not justified and acted this issue is set aside. The AO is directed to delete the disallowance in the light of judgment of Hon’ble Calcutta High Court rendered in the case of Exide Industries Ltd. & Others vs. Union of India & Others [2007 (6) TMI 175 - CALCUTTA HIGH COURT]. - Decided against revenue
Disallowance under section 14A - Held that:- In the absence of any material or basis to hold that the interest expenditure directly or indirectly was attributable for earning the dividend income. The AO ought not to have invoked the provisions of section 14A for making the disallowance. - Decided against revenue
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2017 (10) TMI 1379
Valuation - maintenance of repair services - Inclusion of cost of materials in the total value of taxable services - demand of differential service tax along with interest and penalty - Held that:- It is not disputed that the appellant discharged service tax liability on the labour portion of the value received for the services. They have availed benefit of N/N. 12/2003-ST by deducting the cost of material - the issue is decided in the case of SAFETY RETREADING COMPANY (P) LTD. [2017 (1) TMI 1110 - SUPREME COURT], where it was held that assesee can avail benefit of N/N. 12/2003 to deduct cost of materials when the service is executed under a composite contract containing labour as well as cost of material - demand not sustainable - appeal allowed - decided in favor of appellant.
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2017 (10) TMI 1378
Levy of Customs Duty on re-import - goods manufactured by Ordnance Factory was sent abroad for modification - Held that:- Record reveals that the goods manufactured by Ordnance Factory is excise duty-free in terms of Notification No. 62/95-CE dated 16.3.1995. Once such is the position of law, the re-importation notification should grant exemption to the re-imported goods - Order of the Authority below passed under misconception of law is liable to be set aside - Appeal allowed - decided in favor of appellant.
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2017 (10) TMI 1377
Validity of the proceedings under section 148 - unexplained cash deposits - eligibility of reasons to believe - non independent application of mind - tangible material - Held that:- After going through the reasons recorded by the ITO, Ward-2, Rewari, it of the view that there is no nexus between the prima facie inference arrived in the reasons recorded and information; the information was restricted to cash deposits in bank account but there was no material much less tangible, credible, cogent and relevant material to form a reason to believe that cash deposits represented income of the assessee; that even the communication dated 24.1.2012 could not be made a basis to assume jurisdiction in view of the fact that such an enquiry letter is an illegal enquiry letter and thus cannot be relied upon; that the proceedings initiated are based on surmises, conjectures and suspicion and therefore, the same are without jurisdiction; that the reasons recorded are highly vague, far-fetched and cannot by any stretch of imagination lead to conclusion of escapement of income and there are merely presumption in nature
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2017 (10) TMI 1376
Deduction u/s 10A computation - deduct telecommunication expenses from total turnover and export turnover while computing the eligible deduction u/s l0A - Held that:- Taking into consideration the decision rendered by the Hon’ble High Court of Karnataka in the case of CIT v. Tata Elxsi Ltd. [2011 (8) TMI 782 - KARNATAKA HIGH COURT], we are of the view that the CIT(A)’s order directing the Assessing Officer to exclude telecommunication charges both from export turnover and total turnover, as was prayed for by the assessee in the alternate was rightly accepted by the CIT(A). The relevant ground of appeal of the Revenue is accordingly dismissed.
Excess provision towards warranty expenses created by the assessee - provision created in unscientific way - Held that:- The basis on which the provision for warranty was made was identical in AYs 2002-03 & 2003-04 as well as in AY 2005-06. The Tribunal has in the appeal for the AYs 2002-03 & 2003- 04 after considering the method of providing for warranty liability by way of a provision, specified that the provision made was based on past history and was on scientific method of estimating liability on account of warranty claims. It is clear from the chart which has been extracted in the order of assessment that as and when the period of warranty expires, the assessee writes back the provision made in the books of account to the extent it relates to the warranty liability which the assessee does not incur and which was already provided by way of a provision and allowed as deduction in the past. It appears to us that the provision made by the assessee is scientific and is based on past history. - Decided against assessee
TPA - determination of ALP of the international transactions entered - Held that:- The assessee is in the business of rendering software development services, thus companies functionally dissimilar need to be deselected from the final list.
Action of the CIT(A) excluding companies with turnover of above ₹ 200 crores from the list of comparable companies is held to correct and such action does not call for any interference.
Nature of software expenditure incurred - revenue v/s capital expenditure - Held that:- At the time of hearing, the Bench expressed the view that there was merit in the contention of the learned DR because in paragraph 10.2 the CIT(A) has not dislodged the factual finding of the AO and has merely proceeded to rely on judicial pronouncements. Though there is a finding that software in question was operating software, there is no reference to the basis on which such a finding was given. Therefore, it would be just and proper to set aside the order of CIT(A) on this issue and remand for fresh consideration of the issue, as to whether the software expenditure which was claimed as deduction was capital or revenue in nature. The Assessee is directed to place all the relevant evidence before the AO to show the expenditure was revenue expenditure. Decision of IBM India Ltd. [2006 (3) TMI 196 - ITAT BANGALORE-B] to be followed - Decided in favour of revenue for statistical purposes.
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2017 (10) TMI 1375
Condonation of delay of 1233 days in filing Appeal before this forum - Appellant has submitted that the Commercial Manager looking after the Excise and Customs work who had been with the Company since 2010, did not inform the Management about the receipt of the said order - Held that:- Undisputedly, the order has been delivered to the Appellant on 27.7.2013 but the plea of the Appellant is that the Management has not been communicated by the Commercial Manager of the Company who dealt with the Central Excise and Service Tax matters and continued to be in employment thereafter for three years. It is unacceptable logic and cannot appeal to the sense of a man ordinary prudence that the Commercial manager has not communicated the order for more than three years till he left the job on 14.3.2016 and the company did not take action against him for his negligence thereafter.
Delay can be condoned if sufficient cause explaining the delay is demonstrated.
The application being devoid of merit is accordingly dismissed.
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2017 (10) TMI 1374
Validity of re-opening under section 147 - absence of sanction / approval from the authority prescribed under section 151(2) - Held that:- No such approval of Joint CIT has been obtained by the Assessing Officer in terms of section 151(2) before issuance of notice under section 148 of the Act. When the provisions contained under the statute mandate a particular act to be done in a particular manner, it has to be done in that manner only. AO being bound by statutory provisions has to strictly comply with and act in accordance with the relevant statutory provisions. The argument of the Department that absence of approval from Joint CIT would not invalidate the assessment proceedings, since, the approval has been obtained from a higher authority is too specious an argument to be accepted. Obtaining of sanction from a higher authority does not satisfy the statutory mandate. In absence of sanction / approval from the authority prescribed under section 151(2) issue of notice under section 148 is invalid. Consequently, the assessment order passed in pursuance thereto is also invalid.
Assessee is confronted with the adverse material in possession of the Assessing Officer, he cannot be expected to rebut them considering the fact that the from very beginning the assessee has consistently stated that he has not paid any on-money over and above the declared sale consideration. The learned Commissioner (Appeals) while deciding the issue has clearly brought out the aforesaid factual aspect in his order.
Commissioner (Appeals) that once the assessee has furnished the details of transactions relating to purchase of flat and has stated that he has not paid on-money over and above the declared sale consideration, burden shifts to the AO to falsify assessee's claim by bringing cogent evidence on record. Merely, referring to certain adverse material and statement of third parties, but, without confronting them to the assessee the AO cannot make the addition. No infirmity in the order of the learned Commissioner (Appeals) in deleting the addition. Accordingly, we uphold the order of the learned Commissioner (Appeals) by dismissing the ground raised by the Revenue.
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2017 (10) TMI 1373
Scheme of Arrangement by way of Demerger - Held that:- From the certificate of incorporation filed, it is evident that Applicant No. 1/Demerged Company was incorporated under the provisions of Companies Act, 1956 on 12th May, 2003 with the name of Landmark Infonet Private Limited.
The Authorized Share Capital is ₹ 21,00,00,000/- divided into 2,10,00,000 equity shares of ₹ 10/- each. The Issued, Subscribed and Paid-Up Share Capital of the Transferor Company is ₹ 21,00,00,000/- divided into 2,10,00,000 equity shares of ₹ 10/- each.
From the certificate of incorporation filed, it is evident that the Applicant No. II/Resulting Company-I is incorporated under the provisions of Companies Act, 2013 on 16th September, 2016 under the name and style of Landmark Technonet Private limited.
The Authorised Share Capital of the Applicant No. II/Resulting Company-I is ₹ 1,00,000/- divided into 10,000 equity shares of ₹ 10/- each. The Issued, Subscribed and Paid-up Share Capital is ₹ 1,00,000 divided into 10,000 equity shares of ₹ 10/- each.
From the certificate of incorporation filed, it is evident that the Applicant No. III/Resulting Company-II is incorporated under the provisions of Companies Act 2013 on 1st December, 2016 under the name and style of Innovatech Media Network Private limited. The Authorised Share Capital of the Applicant No. III/Resulting Company-II is ₹ 1,00,000/- divided into 10,000 equity shares of ₹ 10/- each. The Issued, Subscribed and Paid-up Share Capital is ₹ 1,00,000 divided into 10,000 equity shares of ₹ 10/- each.
The applicant companies have filed their respective Memorandum and Articles of Association inter alia delineating their object clauses. The applicant II and III have filed their last available audited financial statements for the year ended 31.03.2017 whereas Applicant No. 1 has filed for the period ended 31st March, 2016 along with the provisional statements for the period ended 31st March, 2017.
The appointed date as specified in the Scheme is 01.04.2017 subject to the directions of this Tribunal.The Board of Directors of the Applicant companies vide separate meetings held on 15th May, 2017 have unanimously approved the proposed Scheme of Arrangement as contemplated above and copies of resolutions passed thereat have been placed on record by the companies.
All the companies have submitted that no investigation proceedings are pending against them under Sections 210 or any other applicable provisions of the Companies Act, 2013.
Taking into consideration the application filed jointly by the Applicant companies and the documents filed therewith, we propose to issue the following directions with respect to calling, convening and holding of the meetings of the shareholders, secured and Unsecured Creditors or dispensing with the same as well as issue of notices
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2017 (10) TMI 1372
The petitioner was required to inform the Court as to whether question “Whether the learned Tribunal has erred in holding that the LPG and acetylene gas are not fuel as per Section 11(3)(b)(iii) of the Gujarat Value Added Tax Act?” is pending for adjudication before this Court? - Held that:- It appears that Civil Appeal Nos. 11801-11802 of 2016 and Civil Appeal Nos. 11095-11102 of 2017 are pending before this Court - The delay in filing the special leave petition is condoned - leave granted.
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2017 (10) TMI 1371
Issues:
1. Interpretation of Section 11(3)(b)(iii) of the Gujarat Value Added Tax Act regarding LPG and acetylene gas classification as fuel.
2. Availability of Input Tax Credit on purchases for construction of capital goods.
Analysis:
1. The judgment addressed two questions referred to the High Court. The first question (A) pertained to whether the Tribunal erred in determining that LPG and acetylene gas do not qualify as fuel under Section 11(3)(b)(iii) of the Gujarat Value Added Tax Act. The High Court's decision favored the petitioner, citing precedents in the cases of State of Gujarat through Commissioner vs. SAL Steel Limited and State of Gujarat vs. Balram Cement Ltd. The Court sought clarification from the petitioner's counsel regarding any appeals against the referenced judgments and scheduled a follow-up after two weeks for further consideration.
2. The second question (B) involved the availability of Input Tax Credit on purchases of materials like steel, cement, kapachi, and greet for the construction of capital goods. The Supreme Court found no fault with the High Court's ruling on this matter, indicating agreement with the view taken. The judgment did not raise any issues with the decision related to Input Tax Credit availability for construction-related purchases.
This comprehensive analysis highlights the specific legal issues addressed in the judgment, the interpretations made by the High Court, and the Supreme Court's stance on each question referred for consideration.
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2017 (10) TMI 1370
Monetary amount involved in the appeal - CBEC’s Circular F. No. 390/Misc./163/2010-JC, dated 17.12.2015 - maintainability of appeal - Held that:- When the appeal is having the tax effect less than the prescribed limit, then appeal is not maintainable - appeal dismissed being not maintainable.
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