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Showing 281 to 300 of 721 Records
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2010 (11) TMI 861
Whether the penalty under Section 76 of the Finance Act, 1994 can be reduced below the minimum limit prescribed? - waiver of penalty u/s 80 - Held that:- The penalty under Section 76 of the Finance Act, 1994 cannot be reduced below the minimum prescribed by invoking Section 80 of the Finance Act, 1994. - Decision in the case of Commissioner, Central Excise and Customs v. Port Officer [2010 (7) TMI 167 - GUJRAT HIGH COURT] followed - matter remanded back to tribunal for fresh consideration - Decided in favor of revenue.
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2010 (11) TMI 860
Whether in the facts and circumstances of the case, the Appellate Tribunal is right in restoring the levy of purchase tax on the purchase consideration of ₹ 6,35,917/- paid by the petitioner on the purchase of fly ash from TNEB by shifting the point of levy from the point of first sale to the point of purchase ?
Whether in the facts and circumstances of the case, the Appellate Tribunal is right in restoring the levy of purchase tax on the sum of ₹ 40,02,498/- being the expenses incurred by the petitioner for transporting the fly ash to their factory, when the condition of sale by TNEB was ex-works and the transportation charges were post purchase expenditure ?
Whether in the facts and circumstances of the case, the Appellate Tribunal is right in restoring the penalty levied under Section 23 of the Act when neither Section 3(3) of the Act nor the declarations contained in Form XVII declaration required that the petitioner must sell the manufactured goods with the State?
Whether branch transfer of manufactured goods to branches / depots and sales thereafter would amount to contravention of provisions of Section 3(3) of the Act and misuse of Form XVII declarations attracting the provisions of Section 23 and Section 45(2)(e) of the Act when the manufacturing activity takes place with the State and tax is paid under Section 3(4) of the Act on the proportionate turnover?
Held that:- As far as question No. (a) is concerned, the learned counsel for the petitioner fairly concedes that the petitioner has accepted the order and is willing to pay the tax determined. The said question is, therefore, answered against the petitioner.
As far as the question No. (b) is concerned it is also answered in favour of the petitioner.
As far as the question No. (c) is concerned in the absence of any specific misdeclaration in regard to the value of stock transfer made by the petitioner, we do not find any basis at all for the Tribunal to hold that imposition of penalty under Section 23 was warranted in this case. We are not, therefore, convinced to sustain the said part of the order of the Tribunal. The question of law raised in ground 'C' therefore answered in favour of the petitioner and the order of the Tribunal on that account stands set aside.
In the light of the conclusions reached above on the question 'c' and having regard to the fact that the petitioner has complied with the requirements of the tax liability under Section 3(4) of the Act, we do not find any contravention of provisions of Section 3(3) of the Act. Consequently, the question of law raised in ground 'd' is answered in favour of the petitioner. Appeal allowed
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2010 (11) TMI 859
Whether the policy has been framed by the legislature or the executive and in either case there should be judicial restraint?
Held that:- Appeal allowed. The Court must maintain judicial restraint and not ordinarily encroach in the domain of executive or legislature.
There should be judicial restraint in fiscal and economic regulatory measures. The State should not be hampered by the Court in such measures unless they are clearly illegal or unconstitutional. All administrative decisions in the economic and social spheres are essentially ad hoc and experimental. Since economic matters are extremely complicated this inevitably entails special treatment for distinct social phenomena. The State must therefore be left with wide latitude in devising ways and means of imposing fiscal regulatory measures, and the Court should not, unless compelled by the statute or by the Constitution, encroach into this field.
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2010 (11) TMI 858
Decree for specific performance granted by the Principal District Court, Chengalpet confirmed - Held that:- Appeal dismissed. The factual findings rendered by the trial Court and the Appellate Court-High Court in respect of grant of decree for specific performance and application of principle of marshalling under Section 56 of the Transfer of Property Act, we are in entire agreement with the conclusion arrived by the High Court. We have also gone through the elaborate order of the High Court in review petitions filed by the appellants. As a matter of fact, after highlighting the jurisdiction under review, the Division Bench of the High Court had taken pains to discuss once again and rendered a finding on all aspects with which we fully agree. Inasmuch as we are confirming the impugned judgment of the High Court in toto, there is no need to refer the affidavit of undertaking filed by the first respondent herein and the objection raised by the appellants as to the contents of the same. Since we confirm the conclusion and ultimate decision of the High Court, we grant further time of three months from today for deposit of the balance amount as directed by the High Court in paragraph 85. In case defendant Nos. 1 and 2 fail to comply with the said directions in executing the sale deed, the trial Court is directed to execute the sale deed incorporating all the directions and observations made in the judgment of the High Court. Consequently, all the appeals are dismissed as devoid of any merit with no order as to costs.
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2010 (11) TMI 857
Application seeking condonation of delay of 59 days in preferring the appeal rejected - Held that:- Appeal allowed. In the present case, the conduct of the appellants does not indicate inaction, negligence or mala fides. The explanation furnished for the marginal delay of 59 days, thus constitutes a sufficient cause and therefore, deserves to be accepted.
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2010 (11) TMI 855
Issues Involved:
1. Confirmation of penalty levied under Section 271(1)(c) of the Income-tax Act, 1961.
2. Voluntary disclosure and its implications on penalty under Section 271(1)(c).
3. The role of application under Section 273A of the Income-tax Act in penalty proceedings.
Issue-wise Detailed Analysis:
1. Confirmation of Penalty Levied under Section 271(1)(c):
The primary issue in these appeals is the confirmation of penalties levied by the Assessing Officer (AO) under Section 271(1)(c) of the Income-tax Act, 1961. The penalties were confirmed by the Commissioner of Income-tax (Appeals) [CIT(A)] based on the AO's findings that the assessee failed to disclose long-term capital gains (LTCG) from land transactions in the original returns filed for the assessment years 2002-03 to 2005-06. The AO initiated penalty proceedings for furnishing inaccurate particulars of income and concealment of income, concluding that the assessee's actions were deliberate and not bona fide.
2. Voluntary Disclosure and Its Implications on Penalty:
The assessee argued that the disclosure of LTCG was voluntary and made in good faith through an application under Section 273A of the Act. The assessee contended that this voluntary offer should preclude the imposition of penalties. The Tribunal noted that the disclosure was made before any inquiry or investigation by the Department, and the AO accepted the computation of LTCG without any modifications. The Tribunal emphasized that the voluntary disclosure was motivated by a desire to clean up affairs and was made without any pending investigation or inquiry, thus qualifying as bona fide and in good faith.
3. The Role of Application under Section 273A in Penalty Proceedings:
The assessee filed an application under Section 273A, seeking waiver of penalties for the assessment years 2002-03 to 2005-06. The Tribunal examined the application and noted that the CIT, Surat, forwarded the information to the AO without deciding on the application. The Tribunal referenced case law, including the Hon'ble Madhya Pradesh High Court's decision in Addl. CIT v. Kanhaiyalal Jessaram, which held that disclosures made under Section 273A should be treated as voluntary and in good faith if no inquiry or investigation was pending. The Tribunal concluded that the assessee's disclosure met these criteria and that the penalty under Section 271(1)(c) should not be levied in such circumstances.
Conclusion:
The Tribunal held that the assessee's voluntary disclosure of LTCG was made in good faith and without any pending inquiry or investigation. The disclosure was accepted by the AO without any modifications, and the assessee paid the due taxes and cooperated fully. Consequently, the Tribunal deleted the penalties levied under Section 271(1)(c) and allowed the assessee's appeals. The order was pronounced in open court on 30/11/2010.
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2010 (11) TMI 854
Issues involved: Petition under Section 256(2) of the Income Tax Act, 1961 seeking mandamus to refer a question of law to the High Court. Addition of unexplained peak cash in the books of account for the assessment year 1984-85. Interpretation of disclosure made under the Amnesty Scheme, 1985 for assessment years 1976-77 and 1977-78.
The petitioner sought mandamus to the Income Tax Appellate Tribunal to refer a question of law regarding the treatment of unexplained peak cash introduced in the books of account for the assessment year 1984-85. The assessee had disclosed amounts under the Amnesty Scheme, 1985 for the assessment years 1976-77 and 1977-78, which was considered by the Commissioner of Income Tax (Appeals) to justify the deletion of the addition made by the Assessing Officer. The Tribunal upheld this decision, leading to the present petition under Section 256(2) of the Act.
The Commissioner of Income Tax (Appeals) noted the disclosure made by the assessee under the Amnesty Scheme, 1985 for the assessment years 1976-77 and 1977-78, which influenced the decision to delete the addition of unexplained peak cash for the assessment year 1984-85. The Tribunal, on appeal by the revenue, observed that there was no evidence to suggest that the disclosed amount had been utilized elsewhere. Both the CIT(A) and the Tribunal's findings were deemed reasonable, with the Tribunal emphasizing that no legal proposition was at issue in their decision.
The Tribunal's refusal to refer the question of law to the High Court was upheld, as it was determined that no error existed in the decision-making process. The Tribunal's conclusion, based on the evaluation of evidence and absence of legal implications, was considered sound. Consequently, the petition was dismissed for lacking merit based on the established findings.
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2010 (11) TMI 853
Application for registration under section 12A - Tribunal allowed registration concluding the concerned authority has to look to the objects and also the activities of the trust in order to consider the application for registration under section 12A - Held that:- When the trust itself was formed in January, 2008, with the money available with the trust, one cannot expect them to do activity of charity immediately and because of that situation the authority cannot come to a conclusion that the trust was not intending to do any activity of charity. In such a situation the objects of the trust have to be taken into consideration by the authority and the objects of the trust could be read from the trust deed itself. In the subsequent returns filed by the trust, if the Revenue comes across that factually the trust has not conducted any charitable activities, it is always open to the authorities concerned to withdraw the registration already granted or cancel the said registration under section 12AA(3) of the Act.
A trust could be formed today and within a week registration under section 12A could be sought as there is no prohibition under the Act seeking such registration. The activities of the trust have to be considered if such registration is sought much later than the formation of the trust or after expiry of the earlier registration granted in favour of the trust. Therefore, in a case of this nature where the trust has approached the authority for registration under section 12A within a span of eight months of its formation, the abovementioned criteria, namely, the objects of the trust for which it was formed will have to be examined to be satisfied about its genuineness and the activities of the trust cannot be the criterion, since it is yet to commence its activities. - Decided in favour of assessee.
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2010 (11) TMI 852
TPA - Comparable selection - HELD THAT:- On considering the facts of the case, We find that there is no dispute on the issue that cost plus method is the most appropriate method for valuing controlled-international transactions in this case The assessee had selected 23 comparables and adjustment was made towards working capital. On this basis the mean of the comparables was worked out 10% against the margin of 17% shown by the assessee. the results of the assessee are in line with the mean margin of comparable cases even if no adjustment is made on account of capital etc. Therefore, it is held that no adjustment was required to be made to the results declared by the assessee company.
In the result, the appeal is allowed.
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2010 (11) TMI 851
Disallowed u/s 014A - HELD THAT:- In case of Godrej Boyce Manufacturing Company Ltd. vs. DCIT [2010 (8) TMI 77 - BOMBAY HIGH COURT] held that Rule 8D will not apply to assessment years prior to A.Y 2008-09. In respect of assessment years prior to 2008-09 the AO has to make the disallowance u/s 014A of the Act on a reasonable basis. We are of the view that the basis adopted by the AO was reasonable and we, therefore, direct that a sum of Rs. 1.00 lac directed to be disallowed by the AO u/s 14A should be restored. We order accordingly.
Loss in valuation of the closing stock - HELD THAT:- the assessee has valued each scrip of the derivatives as at the end of the year. We do not see how this can make any difference to the legal principle. If the derivatives have been treated as stock-in-trade then there is nothing unusual in the assessee valuing each derivative by applying the rule cost or market whichever is lower. We, therefore, direct the AO to allow the provision as reflecting in substance the loss arising on account of valuation of the closing stock. The ground is allowed.
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2010 (11) TMI 850
Issues involved: Petition filed u/s 111(4) of the Companies Act, 1956 seeking to set aside transfer of shares and rectify register of members.
Details of the Judgment:
Issue 1: Setting aside transfer of shares
- Petitioner, a Malaysian citizen, purchased 20,000 shares in 1993 from grandfather.
- Shares allegedly transferred to respondents 2 and 3 in 1998 without petitioner's knowledge.
- Allegations of fraud, forgery, and illegality in the transfer.
- Petitioner claims he did not sign transfer forms or receive consideration.
- Respondents 2 and 3 deny allegations, stating shares were purchased in 1997-98.
- Lack of evidence of fraud and forgery in the petition.
- Petitioner aware of financial transactions with respondents 2 and 3.
- Petitioner's delay in filing petition after 8 years considered.
- Petition found barred by limitation and laches due to delay in filing.
- Petitioner advised to seek relief through civil court or High Court of Madras.
Issue 2: Rectification of register of members
- No evidence presented to support claim of fraudulent transfer.
- Lack of necessary particulars precludes inquiry into alleged fraud.
- Petitioner's awareness of share transfer activities over the years.
- Petition filed in 2005 for shares transferred in 1998 deemed untimely.
- Board suggests approaching civil court or High Court of Madras for relief.
- Company petition dismissed due to lack of merit in petitioner's case.
Separate Judgment: None mentioned.
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2010 (11) TMI 849
Issues:
1. Direction to surrender duplicate share certificate and return original share certificates.
2. Compliance with section 108 of the Companies Act, 1956.
3. Allegations of fraudulent obtaining of duplicate share certificates.
4. Claim of time bar and lack of privity of contract.
5. Consideration of delay in approaching the court.
Analysis:
1. The petition sought directions under section 111A of the Companies Act, 1956, for the surrender of duplicate share certificates and the return of original share certificates duly transferred. The petitioner alleged that the respondent fraudulently obtained duplicate share certificates and misappropriated dividends. The petitioner claimed to have purchased 100 shares from the respondent through a valid transfer deed, but the respondent refused to transfer the shares citing the loss of original certificates.
2. The petitioner contended that the transfer of shares from the respondent to him was in compliance with section 108 of the Act. However, the respondent argued that the petition was time-barred, as the petitioner approached the court after a significant delay of 17 years without providing a satisfactory explanation for the delay. The respondent also denied any privity of contract with the petitioner regarding the shares in question.
3. The respondent claimed that they followed the necessary procedures to obtain duplicate share certificates after the original certificates were allegedly lost by the registered holder. They further stated that they dematerialized and sold the duplicate shares. The respondent emphasized that if the petitioner had any grievances, he should address them with the broker from whom he claimed to have purchased the shares.
4. The Company Law Board noted the absence of representation from the respondents during the hearing. The Board highlighted the significant delay of almost 16 years in approaching the court, which was not adequately explained by the petitioner. The Board concluded that such a delay amounted to wilful delay and latches, leading to the dismissal of the petition on the grounds of delay and latches, without imposing any costs.
In conclusion, the Company Law Board dismissed the petition due to the petitioner's failure to provide a satisfactory explanation for the significant delay in approaching the court, considering it as wilful delay and latches. The Board emphasized the importance of timely legal actions and declined to condone the delay, ultimately leading to the dismissal of the petition without any costs imposed on either party.
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2010 (11) TMI 848
Issues Involved:
1. Legitimacy of the petitioner's claim to 650 shares of Respondent No. 1 Company.
2. Loss and subsequent non-traceability of transfer deeds.
3. Validity and procedure for transfer of shares without original transfer deeds.
4. Entitlement to new shares issued under the scheme of demerger.
5. Entitlement to bonus shares issued post-demerger.
6. Implementation of the court's order regarding physical and dematerialized shares.
Detailed Analysis:
1. Legitimacy of the Petitioner's Claim to 650 Shares:
The petitioner purchased 650 shares of Respondent No. 1 Company on 4-10-1999 through a broker, who issued Bill No. 1131 for Rs. 1,12,635. The petitioner received the share certificates and transfer deeds, becoming a bona fide buyer entitled to transfer and benefits from the shares. The petitioner completed the transferee portion and lodged the shares for transfer.
2. Loss and Subsequent Non-Traceability of Transfer Deeds:
During home renovation, the transfer deeds were lost. The petitioner filed a police complaint on 22-5-2000. New transfer deeds for 229 shares were obtained, but not for the remaining 421 shares. The petitioner informed Respondent No. 1 about the loss and requested a stop transfer mark and guidance under section 108 of the Companies Act, 1956.
3. Validity and Procedure for Transfer of Shares Without Original Transfer Deeds:
Respondent No. 3 informed the petitioner that old share certificates were invalid due to a scheme of arrangement approved by the Bombay High Court, which issued new certificates without surrendering old ones. The petitioner sought an injunction from the City Civil Court, Ahmedabad, and later filed a petition before the Company Law Board (CLB).
4. Entitlement to New Shares Issued Under the Scheme of Demerger:
The petitioner claimed entitlement to new shares under the demerger scheme approved by the Bombay High Court, as a bona fide buyer before the record date. The petitioner argued that transferors, who sold their original shares, held the new shares as trustees and had no right to them.
5. Entitlement to Bonus Shares Issued Post-Demerger:
The petitioner claimed entitlement to bonus shares issued in 2006 and 2008, arguing that transferors had no right to retain them. The petitioner sought recognition of his title over the original and bonus shares.
6. Implementation of the Court's Order Regarding Physical and Dematerialized Shares:
Respondent No. 1 admitted the issuance of new shares to registered holders as per the High Court's order. The company acknowledged the petitioner's claim to 30 shares in physical form and stated that dematerialized shares were beyond its control. The court directed Respondents to rectify the Register of Members, insert the petitioner's name, and issue share certificates within 60 days, subject to indemnity. For dematerialized shares, Respondent No. 10 was to notify relevant parties and decide on the petitioner's claim after due process.
Conclusion:
The court found the petitioner to be the rightful owner of the shares and directed Respondents to rectify the records and issue share certificates for physical shares, while dematerialized shares required further notification and decision by Respondent No. 10. The petition was disposed of with these directions.
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2010 (11) TMI 847
whether there is any guidance to be collected from the Act itself, its object and its provisions, in the light of the surrounding circumstances which made the legislation necessary, taken in conjunction with well known facts of which the court might take judicial notice?
Held that:- Unless the provisions in the BR Act contains any specific restrictions, the 2nd respondent could not be prevented from engaging in any such activity. Yet another contention is that the provisions contained in the BR Act expressly prohibits from engaging any trading or buying and selling. In view of the findings arrived as above, but not agreeable with the contention that the acquisition of the financial assets through transfer by itself will come within the purview of, trading or buying or selling, as contemplated under section 8 of the BR Act. Therefore the transfer of secured assets of the petitioner company by ARCIL to the 2nd respondent and the subsequent transfer by the 2nd respondent to the 1st respondent are not in any manner prohibited and it is not contrary to any of the provisions contained under the SARFAESI Act or under the RDB Act or under the BR Act.
These writ petitions deserve no merit. Challenge raised against the proceedings initiated under the SARFAESI Act on the ground that, assignment of debts and underlying securities of the petitioner company by M/s. ARCIL to the 2nd respondent and the subsequent assignment by the 2nd respondent to the 1st respondent in WP(C).27021/10 [3rd respondent in WP(C).25000/10] is illegal and invalid, is hereby negatived. I hold that those transactions are legal and valid under the provisions of the SARFAESI Act, RDB Act and BR Act, and it is not violative of the guidelines or norms prescribed by the RBI. Accordingly the writ petitions are dismissed.
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2010 (11) TMI 846
Common order passed by the Company Law Board (‘CLB’) challenged allowing the applications filed by the Respondents under section 45 of the Arbitration & Conciliation Act, 1996
Held that:- In regard to the submissions as well, this Court finds no reason to differ from the reasoning and conclusions arrived at by the CLB discussing the provisions of sections 8 and 45 of the AC Act and correctly concluding that the essential requirements of reference of a dispute to arbitration was that the action should be brought before the judicial authority which CLB undoubtedly was. Secondly, the two SHAs had to contain an arbitration clause which, in fact, they did. One of the parties to the SHAs in each matter had applied to the CLB and these applications were made even before submitting a first statement on the merits of the disputes to the CLB. Appeal dismissed.
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2010 (11) TMI 845
Winding up - Circumstances in which a company may be wound up - Held that:- It is accepted by the petitioner that they had security deposit of ₹ 3,88,740. In the petition and the two legal notices dated 19-5-2007 and 25-6-2007 it is not alleged that the security deposit was required to be adjusted on account of arrears towards electricity, water or damages caused to the premises. There are no such allegations or averments. In these circumstances, the security deposit given by the respondent company to the petitioner can be adjusted towards the rent for the months of March to May, 2007. No further amount is due and payable by the respondent company to the petitioner towards admitted liability or debt due and payable, for the purpose of section 433(e) r/w section 434 (1)(a) of the Act.
In view of the aforesaid, I do not find any merit in the winding up petition and the same is dismissed.
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2010 (11) TMI 844
Application under sections 542 and 543 of the Companies Act, 1956
Held that:- In the case on hand, the respondents have given explanation about the clearing of dues with the two secured creditors and the same is borne out on records. As regards the vehicle, the respondents have given a reasonable explanation stating that even though the vehicle was shown at a depreciated value of ₹ 1,67,816 as on March 31, 1993, due to wear and tear over the past ten years, the value of the vehicle declined and therefore, the same was ultimately sold. This, in my considered view, cannot be a reason for the purpose of invoking sections 542 and 543 of the Companies Act, 1956.
Having regard to the seriousness of the provisions and there being no material against the ex-directors, the allegations stand unproved. This application does not merit acceptance and therefore, the same stands dismissed.
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2010 (11) TMI 843
Application is taken out by the official liquidator to take action for misfeasance against the ex-directors of the company under liquidation and for further reliefs
Held that:- There is nothing on record to show that the loss is only on account of misfeasance. It must be noted that for the purpose of proceeding under section 542 of the Act, the essential ingredient is that the directors must have taken the company on a route which they are consciously aware of as leading to a case of total mismanagement, thereby bringing down the company’ s existence. In the absence of any material to substantiate the allegation, one cannot go in a mechanical manner to sustain the contention put forth in the application.
Even though it is the case of the official liquidator that the ex-directors have given the realisable value of the movable and immovable assets as ₹ 26.67 crores in the year 2004, while the same were sold only for ₹ 14 crores in the year 2007 and there is an inflation of value by the ex-directors, admittedly, the assets were sold only in the year 2007, viz., after three years from the valuation, and the reason for lesser realisation of value cannot be imputed on the respondents, especially when the official liquidator with the existing value of the assets could settle 92 per cent. of the liabilities of the secured creditors and workmen creditors, which is of utmost importance. Having regard to the seriousness of the provisions and there being no material against the ex-directors, the allegations stand unproved. This application does not merit acceptance and therefore, the same stands dismissed.
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2010 (11) TMI 842
Issues Involved:
1. Allegations of oppression and mismanagement under sections 397 and 398 of the Companies Act, 1956.
2. Shifting of the registered office without proper notice.
3. Alleged sidelining of the petitioner from management and board operations.
4. Disputes over the appointment of the managing director.
5. Legality of board meetings, extraordinary general meetings, and annual general meetings.
6. Request for fair valuation of shares and sale of shares between parties.
7. Petitioner's right to inspect books of account and records.
Issue-wise Detailed Analysis:
1. Allegations of Oppression and Mismanagement:
The petitioner, holding 30% shares and being a whole-time director, alleged that he was sidelined by the other directors (respondents) who acted as a group. The petitioner claimed that the removal from the post of director and subsequent meetings were illegal, leading to a lack of confidence between the two groups. The respondents countered that the petitioner was not keen on associating with the management due to misunderstandings and had decided to withdraw his personal guarantee for loans, affecting the company's ability to secure credit. The court found that the petitioner's unilateral withdrawal of the personal guarantee was inequitable and prejudicial to the company, contributing to the deadlock and mistrust between the parties.
2. Shifting of Registered Office Without Proper Notice:
The registered office was shifted from the petitioner's residence to the second respondent's residence without a board resolution or notice to the petitioner, violating section 146 of the Act. The respondents argued that the shift was justified due to the petitioner's conduct. The court noted that no evidence was provided to show that notice of the board meeting was served on the petitioner, and the minutes book was not produced. Although the petitioner was likely aware of the shift, the lack of notice amounted to sidelining the petitioner and a breach of fiduciary duty by the other directors.
3. Sidelining of the Petitioner from Management and Board Operations:
The petitioner alleged that he was sidelined from management, including the operation of bank accounts, and that records were fabricated to alter cheque signing powers. The respondents contended that the petitioner was not available to sign cheques and had refused to extend his personal guarantee, necessitating changes in bank operations. The court found that the petitioner's actions, including the withdrawal of the personal guarantee, contributed to the deadlock and justified the respondents' actions to some extent.
4. Disputes Over Appointment of Managing Director:
The petitioner claimed an understanding that he would be appointed as managing director on a rotational basis, which the respondents denied. The court found no material evidence supporting such an understanding and noted that the petitioner's exclusion from management was partly due to his own actions, including the withdrawal of the personal guarantee.
5. Legality of Board Meetings, Extraordinary General Meetings, and Annual General Meetings:
The petitioner challenged the validity of several meetings held without proper notice, including the board meeting on June 21, 2008, and the extraordinary general meeting on July 17, 2008. The respondents argued that due notice was given, and the petitioner had sought leave of absence. The court found that while some meetings were held without proper notice, the overall conduct of the petitioner justified the respondents' actions to some extent. The court did not find sufficient grounds to declare the meetings null and void.
6. Request for Fair Valuation of Shares and Sale of Shares Between Parties:
The petitioner sought a fair valuation of shares and requested that the respondents sell their shares to him. The court found that the mutual trust between the parties had been lost completely and that it would be in the best interest of all concerned for the petitioner to exit the company. The court directed a fair valuation of shares by the statutory auditor and a chartered accountant chosen by the petitioner, with the petitioner selling his shares to the respondents at the determined fair value.
7. Petitioner's Right to Inspect Books of Account and Records:
The petitioner alleged that he was denied access to the company's books and records. The court had previously allowed the petitioner access to inspect the books of account and appointed a chartered accountant to authenticate the records. No irregularities were pointed out in the accounts and records, and the court found no merit in the petitioner's allegations of misuse of accounts by the respondents.
Conclusion:
The court concluded that while there were some breaches of fiduciary duty and procedural lapses, the petitioner's own conduct contributed significantly to the deadlock and mistrust. The court directed a fair valuation of shares and allowed the petitioner to exit the company by selling his shares to the respondents. The remaining reliefs sought by the petitioner were not granted, and all interim orders were vacated. The matter was posted for consequential directions on March 2, 2011.
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2010 (11) TMI 841
Issues: Disallowance of depreciation on a vehicle
Analysis:
The only issue in this appeal pertains to the disallowance of depreciation on a vehicle by the Assessing Officer, which was confirmed by the Commissioner of Income-tax (Appeals) (CIT(A)). The Assessing Officer disallowed the depreciation claim on the grounds that the motor car was purchased in the name of the director of the assessee-company and not in the name of the company itself. The Assessing Officer emphasized the ownership of the asset as a condition precedent for allowing depreciation. The CIT(A) upheld this decision, citing relevant case laws and emphasizing the lack of evidence regarding the use of the vehicle for business purposes.
The Appellate Tribunal, after considering the submissions and facts of the case, found that the vehicle was purchased using funds from the assessee-company. The Tribunal referred to precedents where courts allowed depreciation even when the vehicle was not registered in the name of the company but was used for business purposes. The Tribunal highlighted that ownership, for the purpose of depreciation, should be interpreted broadly, focusing on the entity that benefits from the property rather than just legal ownership. The Tribunal also noted that the assessee provided evidence of petrol and diesel expenses for the vehicle, demonstrating its business use.
In conclusion, the Tribunal disagreed with the lower authorities' decision to disallow depreciation on the vehicle and allowed the assessee's claim. The Tribunal's decision was based on the broader interpretation of ownership for depreciation purposes and the evidence presented regarding the business use of the vehicle. Consequently, the assessee's appeal was allowed, overturning the disallowance of depreciation on the vehicle.
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9911796707
