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Showing 281 to 300 of 851 Records

• 2011 (6) TMI 763
  
  Issues involved:
  The rejection of applications for registration u/s 12AA and approval u/s 80G by the Director of Income-tax (Exemptions) based on the commercial nature of printing and publishing activities and the permissibility of amending the trust deed.
  
  Printing and Publishing Activities:
  The Director of Income-tax (Exemptions) rejected the applications citing the printing and publishing of newspapers as commercial and not charitable activities. However, the Appellate Tribunal found that such activities can be charitable if they serve a public cause like dissemination of knowledge for societal betterment. The Tribunal emphasized that the nature of publishing activities can be either commercial or charitable based on the specific circumstances of each case.
  
  Amendment of Trust Deed:
  The Director's decision to reject the applications due to an amendment in the trust deed was questioned by the Tribunal. It was clarified that trustees can amend the trust deed to enhance trust operations as long as the founders are alive. The Tribunal noted that only in cases where the founders are deceased would a Civil Court intervention be necessary for trust deed amendments.
  
  Conclusion:
  The Tribunal concluded that the Director of Income-tax (Exemptions) was unjustified in rejecting the applications for registration u/s 12AA and approval u/s 80G. Therefore, the Director was directed to grant registration to the assessee-trust under sec.12AA and approval under sec.80G. As a result, the appeals filed by the assessee were allowed.

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• 2011 (6) TMI 762
  
  Issues Involved:
  The judgment involves appeals filed by the Revenue against orders of CIT(A), Jalandhar, under section 250(6) of the Income-tax Act, 1961 for assessment years 2001-02 & 2002-03. The common issue raised is the cancellation of assessment order by CIT(A) due to the AO wrongly assuming jurisdiction under section 147 of the Act.
  
  Issue 1: Jurisdiction under Section 147
  The Revenue contended that the CIT(A) erred in canceling the assessment order, arguing that the AO was justified in initiating proceedings u/s 147 of the Act. However, the CIT(A) quashed the reassessment proceedings, citing that the AO did not show failure on the part of the assessee to disclose material facts in the original assessment. The CIT(A) emphasized that a mere change of opinion on the same facts does not grant jurisdiction under section 147. The appellate order was based on proper appreciation of legal and factual aspects, leading to the dismissal of the revenue's appeals.
  
  Issue 2: Deduction under Section 80IB
  The assessment initially disallowed deduction u/s 80IB to the assessee, but the CIT(A) later allowed the deduction. The Revenue challenged this decision, particularly regarding the profit of the Branch Office at Rajkot. The CIT(A) held that the AO's reasons for reassessment were a mere change of opinion without new information, thus lacking jurisdiction under section 147. The appellate order was deemed well-reasoned and supported by credible material, resulting in the dismissal of the revenue's appeals.
  
  Decision:
  The ITAT Amritsar upheld the CIT(A)'s decision to cancel the assessment order, emphasizing the importance of full and true disclosure by the assessee and the limitations on the AO's jurisdiction under section 147. The appeals filed by the Revenue were dismissed based on the proper evaluation of legal and factual aspects in the case.

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• 2011 (6) TMI 761
  
  Issues Involved:
  1. Disallowance of expenses incurred on current repairs of a leased power plant.
  2. Non-allowance of claimed expenditure as revenue expenditure.
  
  Summary:
  
  1. Disallowance of Expenses Incurred on Current Repairs of a Leased Power Plant:
  The assessee, engaged in manufacturing steel fasteners, nuts, and bolts, filed its return of income showing a loss and book profit u/s 115JB. The AO observed that the assessee had debited Rs. 31,54,844/- as deferred revenue expenditure, treating 10% of it as deferred revenue expenditure in the Profit & Loss account. The AO rejected the assessee's contention that the expenditure was revenue in nature, considering it as leasehold improvements of a capital nature, providing an enduring benefit. Consequently, the AO added the said amount to the income of the assessee, which was upheld by the CIT(A). The assessee appealed, arguing that the expenditure was incurred on repairs of a leased power plant and should be treated as revenue expenditure.
  
  2. Non-Allowance of Claimed Expenditure as Revenue Expenditure:
  The assessee entered into an agreement with M/s Central Coalfield Ltd. for leasing a thermal power station. The expenditure was incurred to make the plant operational, generating revenue during the year. The assessee claimed that the expenditure was necessary for repairs and maintenance of the leased plant, thus qualifying as revenue expenditure. The CIT(A) upheld the AO's view that the expenditure was capital in nature. The assessee argued that the expenditure did not create any capital asset and was necessary for the plant's operation, thus should be treated as revenue expenditure. The Tribunal noted that the expenditure was for items like lubricating oil, replacement parts, and other necessary repairs, which did not create any capital asset and were essential for the plant's operation. The Tribunal concluded that the expenditure did not provide any enduring benefit and should be treated as revenue expenditure.
  
  Conclusion:
  The Tribunal held that the expenditure incurred by the assessee was revenue in nature and allowable as such. The alternative ground for depreciation became infructuous. The appeal filed by the assessee was allowed.

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• 2011 (6) TMI 760
  

  Pre-deposit - availing of inadmissible input service credit on the service of cost service charges incurred by the dealers on behalf of the appellant - the applicant submits that on identical issue Commissioner, Nashik have also issued SCN to the applicants and the demand was dropped in that case - Held that: - Considering the fact that the Commissioner, Nashik has dropped the proceedings on identical issue, therefore, we find that it is a fit case for grant of unconditional waiver to the applicant - pre-deposit waived - decided in favor of assessee.

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• 2011 (6) TMI 759
  
  Issues Involved:
  1. Bail Applications under Section 439 Cr.P.C.
  2. Allegations of Criminal Conspiracy and Misconduct
  3. Procedural Aspects of Custody and Remand
  4. Interpretation of Sections 87 and 88 Cr.P.C.
  5. Judicial Discretion in Granting Bail
  6. Prima Facie Evidence and Nature of Accusation
  
  Detailed Analysis:
  
  1. Bail Applications under Section 439 Cr.P.C.
  The accused sought bail under Section 439 Cr.P.C. in relation to FIR No. RC-DAI-2009-A-0045 registered by the CBI for criminal conspiracy and misconduct in the allocation of UAS Licences and 2G spectrum.
  
  2. Allegations of Criminal Conspiracy and Misconduct
  The prosecution alleged a criminal conspiracy involving public servants and private individuals, including the accused, to manipulate the Department of Telecommunications' policy for personal gain. The charge sheet detailed how the policy was altered to benefit specific companies, leading to significant financial loss to the state.
  
  3. Procedural Aspects of Custody and Remand
  The petitioners argued that they were not in custody when they appeared before the Special Judge pursuant to summons under Section 204 Cr.P.C. They contended that the court erred in remanding them to judicial custody as they were not previously detained. The court referred to Supreme Court judgments to clarify that "custody" under Section 439 Cr.P.C. includes being under the court's control, even if not physically detained.
  
  4. Interpretation of Sections 87 and 88 Cr.P.C.
  The petitioners argued that under Sections 87 and 88 Cr.P.C., they should be released on bond upon appearance. The court clarified that these sections pertain to processes for ensuring appearance and do not mandate bail for non-bailable offenses. The court emphasized that judicial discretion under Section 88 Cr.P.C. does not override the specific provisions of Section 437 Cr.P.C. for non-bailable offenses.
  
  5. Judicial Discretion in Granting Bail
  The court discussed various precedents emphasizing the balance between personal liberty and the interests of justice. Factors such as the nature and gravity of the accusation, the severity of potential punishment, and the risk of the accused absconding or tampering with evidence were highlighted as crucial in deciding bail applications.
  
  6. Prima Facie Evidence and Nature of Accusation
  The court found prima facie evidence indicating the petitioners' involvement in the conspiracy and receipt of illegal gratification. The detailed money trail and the timing of transactions suggested an attempt to conceal the bribe. Given the petitioners' political and financial influence, the court deemed it inappropriate to grant bail, fearing potential interference with the investigation and witness tampering.
  
  Conclusion:
  The bail applications were dismissed based on the prima facie evidence of the petitioners' involvement in a significant conspiracy causing substantial financial loss to the state. The court emphasized the risk of interference with the investigation and the potential influence over witnesses due to the petitioners' political and financial clout. The decision was made considering the established legal principles and the specific circumstances of the case.

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• 2011 (6) TMI 758
  
  Issues Involved:
  1. Whether the penalty u/s 271D for contravention of section 269SS was justified.
  2. Whether the penalty u/s 271E for contravention of section 269T was justified.
  
  Summary:
  
  Issue 1: Penalty u/s 271D for Contravention of Section 269SS
  The Revenue appealed against the cancellation of a penalty of Rs. 24,52,740/- levied u/s 271D of the Income-tax Act, 1961, for contravention of section 269SS. The Addl. CIT noticed that the assessee accepted loans/deposits in cash, which was reported in the statutory audit report. The assessee argued that the transactions were not loans but were related to fee collections and reimbursements between the hostel and the school managed by the same trustee. The CIT(A) found that the transactions were in the nature of current accounts and not loans or deposits, thus not violating section 269SS. The Tribunal upheld the CIT(A)'s decision, noting that the transactions were bona fide and there was no tax evasion, thus confirming the cancellation of the penalty.
  
  Issue 2: Penalty u/s 271E for Contravention of Section 269T
  The Revenue also appealed against the cancellation of a penalty of Rs. 30,92,911/- levied u/s 271E for contravention of section 269T. The Addl. CIT imposed the penalty for repaying loans/deposits in cash. The assessee contended that the transactions were not repayments of loans but were related to operational reimbursements and fee collections. The CIT(A) held that the transactions were in the nature of current accounts and not loans or deposits, thus not violating section 269T. The Tribunal agreed with the CIT(A), emphasizing that the transactions were bona fide and there was no tax evasion, thereby confirming the cancellation of the penalty.
  
  Conclusion:
  The Tribunal dismissed both appeals by the Revenue, confirming the CIT(A)'s orders canceling the penalties u/s 271D and 271E. The Tribunal concluded that the transactions were in the nature of current accounts, not loans or deposits, and there was no tax evasion, thus the penalties were not justified.

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• 2011 (6) TMI 757
  
  Issues involved: Challenge to Tribunal's judgment by Revenue based on tax effect of loss claimed by assessee, interpretation of CBDT circulars on monetary limits for filing appeals.
  
  Judgment Summary:
  
  1. The Revenue challenged the Tribunal's judgment based on the tax effect of the loss claimed by the assessee. The Tribunal dismissed the appeal, citing that the assessee had suffered a loss and the CBDT's circulars on monetary limits for filing appeals rendered the Revenue's appeal not competent.
  
  2. The notional tax amount was higher than the limit prescribed by the Board's circular at the relevant time.
  
  3. In a separate judgment, it was observed that the circulars did not intend to bar tax appeals even in cases where the potential tax effect would be significant, solely because the assessee had negative income. The circulars provided monetary limits for filing appeals based on tax effect, and the notional tax effect had to exceed the prescribed limits for the appeal to be presented.
  
  4. It was clarified that the Board's instructions did not shut out further appeal in cases of return of loss automatically, irrespective of the difference in perception between the Assessing Officer and the CIT (Appeals) regarding the computation of loss. The subsequent clarifications in circulars did not amplify the position prevailing prior to such circulars.
  
  5. The common question framed in all appeals was answered in favor of the Revenue, stating that the Revenue's appeal would not be barred by the Board's circular under Section 268A of the Act solely because the income of the assessee was negative. The notional tax effect had to be above the limits prescribed by the Board for presentation of such appeals.
  
  6. The Tax Appeal was allowed, the Tribunal's judgment was quashed, and the proceedings were remanded to the Tribunal for consideration of the appeal on merits.

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• 2011 (6) TMI 756
  
  The High Court of Andhra Pradesh dismissed the writ petition as withdrawn with no costs. The petitioners were granted permission to avail appropriate alternative remedy. (Citation: 2011 (6) TMI 756 - Andhra Pradesh High Court)

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• 2011 (6) TMI 755
  
  Issues involved:
  The issue raised is the deletion of an addition of Rs. 4,34,00,000/- on account of unexplained credits in the form of share application money.
  
  Details of the Judgment:
  
  Issue 1: Unexplained credits in the form of share application money
  The Assessing Officer found that the assessee received Rs. 4,34,00,000/- as unexplained credits in the form of share application money. Notices u/s. 133(6) sent to investors were returned as underserved. The Assessing Officer noted discrepancies in the income declared by investors and observed large transfers before issuing cheques. Consequently, the Assessing Officer treated the share capital amount as unexplained cash credits and added it to the assessee's income.
  
  Issue 2: Appeal by the assessee
  Upon the assessee's appeal, the Ld. Commissioner of Income Tax (Appeals) noted that the assessee provided necessary documents like confirmation certificate, bank statements, income tax returns, audited balance sheet, and additional information as required under the Companies Act. The Ld. Commissioner observed that the Assessing Officer did not doubt the identity of the share applicants, a crucial parameter to be fulfilled by the assessee. Referring to a decision of the Hon'ble Jurisdictional High Court, the Ld. Commissioner held that once the identity of creditors/share applicants is proven, the onus shifts to the Revenue. The Ld. Commissioner concluded that the addition was misconceived and should be deleted.
  
  Issue 3: Decision of the Appellate Tribunal
  The Appellate Tribunal upheld the Ld. Commissioner's order, stating that the assessee had established the identity of share applicants and provided necessary documentation. Citing a relevant Supreme Court decision, the Tribunal emphasized that if share application money is received from alleged bogus shareholders, the Department can proceed to reopen individual assessments but cannot treat it as undisclosed income of the assessee.
  
  In conclusion, the appeal filed by the Revenue was dismissed, and the order of the Ld. Commissioner of Income Tax (Appeals) was upheld.

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• 2011 (6) TMI 754
  
  Issues involved: Appeal against order of CIT(A) for assessment year 2004-05.
  
  Facts: Search and seizure operation u/s. 132 of the I.T. Act, 1961 in group cases of M/s. Bhooratnam & Company. Incriminating documents found and seized. Case notified with ACIT, Central Circle-5, Hyderabad.
  
  Issue 1 - Interest u/s. 234B and 234C:
  - Assessing Officer levied interest u/s. 234B and u/s. 234C.
  - Assessee claimed TDS at Rs. 56,90,053, but only Rs. 29,09,173 credit given by AO.
  - Assessee argued for TDS benefit u/s. 199 as per Rule 37BA of I.T. Rules.
  - Counsel cited judgment of Central Provinces Manganese Ore Co. Ltd. v. CIT (1986) 160 ITR 961 (SC).
  - Counsel contended no shortfall in payment of prepaid taxes if full TDS credit given.
  - Mumbai ITAT decision in the case of Datamatics Ltd. (2008) 299 ITR (AT) 286 referred.
  - Counsel argued interest levied u/s. 234B without legal basis.
  
  Issue 2 - Interest u/s. 234C:
  - Assessee argued not liable for advance tax due to TDS exceeding tax payable.
  - Shortfall in prepaid tax calculated due to incomplete TDS credit.
  - Counsel requested deletion of interest levied u/s. 234C.
  - AO added interest u/s. 234B and u/s. 234C aggregating to Rs. 6,60,152.
  
  Judgment:
  - CIT(A) directed AO to give credit for TDS certificates filed by appellant company as per Rule 37BA.
  - Tribunal found no balance of tax payable by assessee after TDS credit.
  - Assessee not liable for interest u/s. 234B and 234C.
  - Revenue's appeal dismissed.
  
  Note: Separate judgment not delivered by the judges.

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• 2011 (6) TMI 753
  
  Issues Involved:
  1. Legality of the arrest memos dated 06.08.2010 and 14.09.2010.
  2. Whether Ketamine and Ketamine Hydrochloride are distinct substances under the law.
  3. Entitlement to compensation for alleged illegal incarceration.
  
  Summary:
  
  1. Legality of the Arrest Memos:

  The petitioners challenged the arrest memos dated 06.08.2010 and 14.09.2010 issued by the Senior Intelligence Officer, D.R.I., Chennai. The first petitioner was intercepted at Chennai Airport with lorry transport receipts for Ketamine, leading to the seizure of 150 Kgs. of suspected Ketamine. The petitioner admitted his involvement under Section 108 of the Customs Act, 1962. The second petitioner was alleged to have supplied Ketamine to the first petitioner and also made a voluntary statement on 14.09.2010. The petitioners argued that there was no prohibition on the export of Ketamine or Ketamine Hydrochloride under the Customs Act and that their possession was not an offence.

  2. Distinction Between Ketamine and Ketamine Hydrochloride:

  The petitioners contended that Ketamine and Ketamine Hydrochloride are different substances and that the notification under the FTDR Act only referred to Ketamine. The court noted that Ketamine Hydrochloride is a chemical compound of Ketamine, having an identical effect and more stable. It was further noted that Ketamine Hydrochloride is prone to smuggling and is used in "rave parties" in various countries. The court referred to a notification issued by the Ministry of Finance on 10.02.2011, including Ketamine as a psychotropic substance under the NDPS Act, 1985, and clarified that all forms and derivatives of Ketamine are psychotropic substances.

  3. Entitlement to Compensation:

  The petitioners argued that their arrest was illegal and sought compensation for illegal incarceration. The court held that the petitioners' arguments did not hold merit as the notification under the NDPS Act clarified that Ketamine and its derivatives are psychotropic substances. The court dismissed the writ petitions, stating that the petitioners must stand trial before the appropriate criminal court and put forth their defense under the law.

  Conclusion:

  The writ petitions were dismissed, and the court held that the arrest memos were not illegal. The petitioners were not entitled to any compensation for their incarceration. The court emphasized that the petitioners must face trial and present their defense in the appropriate criminal court.

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• 2011 (6) TMI 752
  
  Issues Involved:
  1. Disallowance of Rs. 6,72,339/- u/s 41(1) of the Act.
  2. Disallowance of Rs. 52,156/- on account of additional depreciation on fixed assets under Technology Upgradation Fund Scheme (TUFS).
  
  Summary:
  
  Issue 1: Disallowance of Rs. 6,72,339/- u/s 41(1) of the Act

  The assessee, engaged in the business of manufacturing twisted yarn, had certain creditors outstanding for more than three years. The AO treated these as profit u/s 41(1) due to lack of confirmations and the creditors being untraceable. The CIT(A) confirmed the addition, rejecting the assessee's evidence of pending disputes as additional evidence not produced before the AO. The Tribunal held that for a sum to be taxable u/s 41(1), there must be a cessation or remission of liability, which was not evident in this case. The Tribunal emphasized that merely because amounts are outstanding for years does not imply cessation or remission. The Tribunal referred to several judgments, including CIT vs. Bharat Iron & Steel Industries and CIT vs. Sugauli Sugar Works, to support its decision. The Tribunal concluded that since no event indicating cessation or remission occurred during the current year, the outstanding balances could not be taxed u/s 41(1). Consequently, this ground of appeal was allowed.

  Issue 2: Disallowance of Rs. 52,156/- on account of additional depreciation under TUFS

  The assessee claimed additional depreciation on machinery purchased under TUFS, which the AO disallowed, restricting depreciation to 25% as per Rule 5 in Appendix-I, Sr. No.III(6) of IT Rules. The CIT(A) upheld the AO's decision. The Tribunal, relying on its earlier decision in Bipinchandra Mohanlal Gajjar vs. ITO, held that twister machines used by the weaving sector of the textile industry are eligible for 50% depreciation. Consequently, this ground of appeal was also allowed.

  Conclusion:

  The appeal filed by the assessee was allowed, with both grounds of disallowance being overturned.

  Order was pronounced in open Court on 30/6/11.

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• 2011 (6) TMI 751
  
  Issues involved:
  The judgment involves issues related to the attachment of properties by the Regional Provident Fund Commissioner and Recovery Officer u/s 11(2) of the E.P.F. and M.P. Act,1952, in the context of a property auctioned under the SARFAESI Act.
  
  Details of the Judgment:
  
  1. Background and Auction of Properties:
  The petitioner purchased two properties in a public auction under the SARFAESI Act from a bank that had taken possession and sold the properties due to default by the previous owner. The petitioner and his wife acquired plot Nos. 49 and 81 respectively, with sale certificates issued by the bank.
  
  2. Impugned Notice and Legal Arguments:
  The second respondent issued a notice demanding arrears from the previous owner, leading to an attachment of the properties. The petitioner, represented by senior counsel, argued that as a bona fide purchaser under the SARFAESI Act, the attachment order was invalid and the petitioner's rights should not be obstructed.
  
  3. Court Proceedings and Observations:
  The second respondent did not appear, while the bank contested the claim. The petitioner's counsel highlighted that the attachment was not recorded in the encumbrance certificate at the time of purchase, establishing the petitioner as a bona fide purchaser.
  
  4. Validity of Purchase and Possession:
  The petitioner's purchase was before the attachment order, and the encumbrance certificate did not reflect the attachment until later. The possession was taken by the bank before the auction, further supporting the petitioner's claim as a bona fide purchaser.
  
  5. Legal Precedents and Priority of Claims:
  Citing legal precedents, the court emphasized that the petitioner's purchase without notice of the attachment should not be affected by the second respondent's claim. The court upheld the petitioner's rights as a bona fide purchaser under the SARFAESI Act.
  
  6. Conclusion and Judgment:
  The court set aside the impugned order, allowing the petitioner to retain ownership of the properties without interference. The second respondent was directed to address any claims to the bank, recognizing the petitioner's status as a bona fide purchaser. The writ petition was allowed with no costs incurred.
  
  In summary, the judgment addressed the conflict between the attachment of properties under the E.P.F. and M.P. Act and the rights of a bona fide purchaser under the SARFAESI Act, ultimately ruling in favor of the petitioner's ownership rights.

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• 2011 (6) TMI 750
  
  Issues involved: Penalty u/s 271(1)(c) of the Income tax Act, 1961 for alleged concealment of income.
  
  Facts leading to the appeal:
  A search u/s 132 was conducted at the residence of a partner of a firm, revealing incriminating material. The firm filed its return of income showing business income. Penalty proceedings u/s 271(1)(c) were initiated, contending that the firm concealed income for the relevant year.
  
  Arguments before CIT(A):
  The CIT(A) deleted the penalty based on various grounds, including timely filing of return, payment of taxes, and disturbance caused by the search. The firm's books were audited, and no further additions were made by the Assessing Officer.
  
  Revenue's grounds for appeal:
  The Revenue challenged the deletion of penalty, arguing that no advance tax was paid, books were not found during the search, and income was only disclosed post-search.
  
  Tribunal's analysis and decision:
  The Tribunal noted that concealment of income and furnishing inaccurate particulars are distinct defaults requiring deliberate intent. The onus is on the Revenue to establish these conditions for penalty. Explanation 5 of section 271(1)(c) was crucial, as the income was revealed post-search and not intimated earlier.
  
  Conclusion:
  The Tribunal upheld the penalty, emphasizing that the firm concealed taxable income, which came to light only due to the search. The firm's actions indicated deliberate concealment, and the acceptance of returned income without enquiry did not absolve it from penalty. The penalty was confirmed, and the Revenue's appeal was dismissed.
  
  Judgement:
  The appeal filed by the Revenue against the deletion of penalty u/s 271(1)(c) was dismissed by the Tribunal, confirming the penalty imposed by the Assessing Officer for concealment of income.

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• 2011 (6) TMI 749
  
  Issues involved:
  1. Allowance of exemption u/s. 10A of the IT Act
  2. Treatment of expenditure on purchase of software
  
  Issue 1: Allowance of exemption u/s. 10A of the IT Act
  The appellant Revenue challenged the Ld. Commissioner of Income Tax (Appeals)'s decision to allow the claim of exemption u/s. 10A of the IT Act. The assessee company claimed exemption u/s 10A amounting to Rs. 1,18,05,695, supported by a registration issued by STPI. The Assessing Officer rejected the claim stating that only the Inter Ministerial Standing Committee can grant approval for deduction u/s. 10. The Ld. Commissioner of Income Tax (Appeals) referred to a tribunal decision and held that the STPI registration was valid for deduction u/s 10B, similar to the present case, and thus allowed the exemption u/s. 10A. The ITAT upheld the Ld. Commissioner's decision, citing consistency and precedent, dismissing the Revenue's appeal.
  
  Issue 2: Treatment of expenditure on purchase of software
  The second issue pertained to the disallowance of Rs. 11,80,232 treated as capital expenditure on software purchase by the Assessing Officer. The assessee contended that this amount was for software supportive of running the main software, not for acquiring an asset. The Ld. Commissioner of Income Tax (Appeals) referred to a case law where it was held that software requiring regular upgrades does not create a capital asset. Consequently, the Ld. Commissioner held the expenditure as revenue expenditure. The ITAT, after considering the nature of expenditure and business, upheld the Ld. Commissioner's decision, dismissing the Revenue's appeal.

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• 2011 (6) TMI 748
  
  Issues involved:
  The issue raised is the deletion of an addition of Rs. 35,00,000/- made u/s 68 of the IT Act by the Ld. Commissioner of Income Tax (Appeals).
  
  Details of the Judgment:
  
  Issue 1: Addition u/s 68 of the IT Act
  The Assessing Officer made the addition of Rs. 35 lacs regarding share application money received u/s 68 of the IT Act based on various reasons, including the involvement of entry operators, inability to explain the source of money, and cash deposits in bank accounts of share applicants. The Assessing Officer highlighted the modus operandi of entry operators to justify the addition.
  
  Issue 2: Appeal before Ld. Commissioner of Income Tax (Appeals)
  Upon appeal, the Ld. Commissioner of Income Tax (Appeals) noted that the assessee company had received share application money from several companies and provided detailed documentation for verification. The Ld. Commissioner observed that the Assessing Officer did not verify these details or dispute them, and the assessee had fulfilled the necessary conditions for verification. Referring to legal precedents, the Ld. Commissioner concluded that the assessee had provided essential details and deleted the addition of Rs. 35 lacs.
  
  Issue 3: Tribunal's Decision
  The Tribunal found that the assessee had provided necessary details to establish the identity of the share applicants, including PAN numbers, income tax returns, and other relevant documents. Citing legal precedents, the Tribunal upheld the Ld. Commissioner's decision, emphasizing that if share application money is received from alleged bogus shareholders, the Department can proceed to reopen individual assessments but cannot treat it as undisclosed income of the assessee.
  
  Conclusion:
  Based on the discussion and legal precedents, the Tribunal found no infirmity in the Ld. Commissioner's order and dismissed the appeal filed by the Revenue.
  
  This judgment highlights the importance of providing detailed documentation to support transactions and the burden of proof on the assessing authorities to verify such details before making additions u/s 68 of the IT Act.

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• 2011 (6) TMI 747
  
  Issues involved: Appeal against imposition of penalty under section 271D of the Income Tax Act, 1961 for the assessment year 2005-06.
  
  Grounds of appeal raised by the assessee:
  1. CIT(A) erred in upholding that the appellant is not an agriculturist and violated section 269SS.
  2. CIT(A) erred in upholding that the appellant is a partner in a firm and drawn salary, violating section 269SS.
  3. CIT(A) erred in upholding penalty order without considering submissions made during appellate proceedings.
  4. CIT(A) erred in upholding penalty order without considering reasonable cause as appellant believed section 269SS did not apply.
  
  Summary of Judgment:
  The Appellate Tribunal ITAT Amritsar heard the appeal against the penalty imposed under section 271D of the Income Tax Act, 1961 for the assessment year 2005-06. The assessee contended that section 269SS was not applicable to their case, citing relevant case laws. The Tribunal noted that the loans in question were taken before the assessee became a partner in the firm, and both lender and borrower were agriculturists with no taxable income. Relying on the second proviso to section 269SS and the case laws presented, the Tribunal found in favor of the assessee and deleted the penalty.
  
  The Tribunal considered the facts, submissions, and relevant provisions of the Act, along with the case laws cited by the assessee's counsel. It was established that the loans were taken before the assessee became a partner, and both parties involved were agriculturists with no taxable income. The Tribunal found that the penalty imposed was not sustainable based on the second proviso to section 269SS and the case laws presented. Consequently, the penalty imposed on the assessee was deleted.
  
  In conclusion, the appeal filed by the assessee was allowed, and the penalty under section 271D was set aside based on the applicable case laws and provisions of the Income Tax Act. The decision was pronounced in open court on 13th June 2011.

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• 2011 (6) TMI 746
  
  Issues involved: Challenge to order u/s 269 UD(1) of the Income Tax Act, 1961 for lack of hearing and non-compliance with court directions.
  
  Summary:
  The Writ Petitions were filed to challenge the order passed by the Appropriate Authority u/s 269 UD(1) of the Income Tax Act, 1961. The petitioners contended that the order was issued without granting them a hearing and without adhering to the court's directions from a previous litigation. Additionally, it was argued that due to non-compliance with Section 269UG of the Income Tax Act, the order should be considered void, and the property should revert to the petitioners.
  
  In response, the affidavit filed by the respondents acknowledged that the notice was mistakenly sent to the deceased original transferee's address instead of the legal heirs. Consequently, the High Court held that since the order was issued without proper notice to the petitioners, it should be quashed and set aside. The Appropriate Authority was directed to issue a fresh order after granting a personal hearing to the petitioners and in compliance with the court's directions from the previous litigation.
  
  The Court made the rule absolute with no order as to costs, keeping all contentions open. The Appropriate Authority assured that a fresh order would be passed within six weeks from the date of the judgment.

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• 2011 (6) TMI 745
  
  Issues:
  1. Interpretation of Rule 7(4) of Central Excise Rules, 2001.
  2. Tribunal's power to set aside orders and waive interest for non-payment of duty.
  3. Application of previous judgments on similar issues.
  
  Interpretation of Rule 7(4) of Central Excise Rules, 2001:
  The appeal in question arose from a decision by the Customs, Excise & Service Tax Appellate Tribunal, South Zonal Bench, setting aside an order passed by the Assistant Commissioner of Central Excise. The significant issue raised was whether the Tribunal erred in allowing the appeal without considering the provisions of Rule 7(4) of the Central Excise Rules, 2001. The High Court admitted the appeal to address this substantial question of law. The Court referred to a connected appeal where similar issues were discussed and answered in favor of the revenue. Relying on the Supreme Court's decision in Commissioner of Central Excise v. International Auto Ltd., the High Court concluded that the Tribunal had indeed erred in its decision. Consequently, the High Court set aside the Tribunal's order and restored the original authority's decision.
  
  Tribunal's power to set aside orders and waive interest for non-payment of duty:
  Another crucial issue in the case was whether the Tribunal had the authority to set aside orders and waive interest when a respondent failed to pay duty on time as prescribed by the Statute. This issue was intertwined with the interpretation of Rule 7(4) of the Central Excise Rules, 2001. The High Court's decision in the connected appeal, based on the Supreme Court's ruling, clarified that the Tribunal did not have the power to waive interest or set aside orders in such circumstances. The Court held that the respondent's failure to pay duty on time and finalize provisional assessment within the stipulated period under Rule 7(3) did not warrant the Tribunal's intervention. Therefore, the High Court ruled in favor of the revenue, setting aside the Tribunal's order and reinstating the original authority's decision.
  
  Application of previous judgments on similar issues:
  The High Court's analysis of the case also involved considering previous judgments on similar issues. By referring to a connected appeal where comparable questions of law were addressed, the Court relied on its earlier decision, which was in line with the Supreme Court's ruling in Commissioner of Central Excise v. International Auto Ltd. The Court's reliance on these precedents helped in resolving the issues raised in the present appeal. Ultimately, the High Court's decision was guided by established legal principles and interpretations, ensuring consistency in the application of the law.

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• 2011 (6) TMI 744
  
  Issues involved:
  The judgment involves issues related to the interpretation of revenue receipts u/s 80-IB of the Income Tax Act, 1961, and the applicability of judgments of the Hon'ble Supreme Court in determining the nature of receipts as capital or revenue.
  
  Issue 1: Interpretation of revenue receipts u/s 80-IB:
  The assessee, engaged in manufacturing Menthol from Mentha Oil, received excise duty refunds for the assessment years 2005-06 and 2006-07. The A.O. disallowed the deduction claimed u/s 80-IB, taxing the entire amounts. On appeal, the CIT(A) allowed the appeals based on a judgment of the Hon'ble jurisdictional High Court in a similar case. The Revenue challenged this decision before the Tribunal.
  
  Details for Issue 1:
  The Hon'ble High Court in the case of M/s. Shree Balaji Alloys addressed a similar issue regarding excise refunds and interest subsidies. The High Court held that the incentives provided for industrial development, aimed at creating employment opportunities and industrial growth, were capital receipts and not production incentives. The Court emphasized the public purpose behind the incentives and overturned the Tribunal's decision that treated the incentives as revenue receipts. The Tribunal, respecting the High Court's decision, upheld the CIT(A)'s findings in favor of the assessee, dismissing the Revenue's appeals.
  
  Issue 2: Applicability of Hon'ble Supreme Court judgments:
  The Revenue raised concerns about the CIT(A) not appreciating the judgments of the Hon'ble Supreme Court in the cases of Ponni Sugar & Sawhney Steel and Press Works Ltd., and Seaham Harbour Dock Company, which provide guidance on determining whether receipts are trading or capital receipts.
  
  Details for Issue 2:
  The Revenue contended that the CIT(A) did not consider the Hon'ble Supreme Court judgments that set criteria for distinguishing between trading and capital receipts. However, the Tribunal relied on the specific judgment of the Hon'ble jurisdictional High Court in the case of M/s. Shree Balaji Alloys, which addressed the nature of excise refunds and subsidies in the context of industrial development incentives. The Tribunal found the issue to be settled in favor of the assessee based on the High Court's decision, thereby dismissing the Revenue's appeals.
  
  In conclusion, the Tribunal upheld the CIT(A)'s decision in favor of the assessee, emphasizing the capital nature of the receipts in question based on the public purpose and industrial development objectives behind the incentives provided. The judgment highlights the significance of legal precedents and jurisdictional decisions in determining the tax treatment of specific receipts under the Income Tax Act, 1961.

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