Disallowance of assessee’s claim of interest on refund - Held that:- Even if the excess TDS was paid by the assessee to the Govt. account voluntarily under misconception, however, as held by the Hon'ble Supreme Court in Union of India v/s Tata Chemicals Ltd. [2014 (3) TMI 610 - SUPREME COURT] even in the absence of an express statutory provision for payment of interest, the assessee has to be paid interest on refund from the date of payment of such tax. It has further been brought to our notice that the CBDT abiding by the view expressed by the Hon'ble Supreme Court in Tata Chemicals Ltd. (supra) had issued Circular no.11 of 2016 dated 26th April 2016, wherein, it is stated that if a resident deductor is entitled for refund of tax deposited, then it has to be refunded with interest under section 244A from the date of payment of such tax. In the said Circular, Departmental Authorities have also been advised not to contest the claim of interest in appeal. Thus, in view of the decision of the Hon'ble Supreme Court as referred to above and the CBDT circular no.11 of 2016 dated 26th April 2016, we hold that the assessee is entitled to receive interest on excess TDS refunded to him from the date of payment.
Interest on interest - Held that:- The primary facts relating to the payment of excess TDS to the Government account as well as claim of interest on refund are available in the records of the Department, therefore, the legal issue pertaining to the assessee’s claim of interest on interest can be decided on the basis of those facts. In that view of the matter, the learned Commissioner (Appeals) was not justified in rejecting additional ground raised by the assessee. We, therefore, restore this issue back to the file of the Assessing Officer for deciding assessee’s claim of interest on interest in the light of the facts and material on record and in consonance with the relevant statutory provisions as well as the decisions which may be relied upon by the assessee. Accordingly, ground no.3, is allowed for statistical purposes.
Penalty - wrong availment of CENVAT credit on capital goods - Rule 4(2) (a) of CCR - Held that: - appellant's bona-fides are strengthened by the fact that as soon as the audit pointed out the short levy, they paid differential duty along with interest before issuance of SCN - there does not appear to be any deliberate suppression by the assessee with intent to evade duty, hence, the penalty under Rule 15(2) of Cenvat Credit Rules, 2004 is not justified - appeal allowed - decided in favor of appellant.
Whether the respondent had mis-declared the imported of spares along with clearance of dredger claiming NIL rate of duty, claiming benefit under Customs N/N. 21/2002 Sl. No. 353A consequently, non-payment of SAD by N/N. 20/2006? - whether the seizure vacated by the adjudicating authority is correct or otherwise?
Held that: - there is no dispute as to that the spares which were found on the dredger were not sought to be cleared as individual items but were considered by the respondent as mandatory spares - the adjudicating authority was correct in vacating the seizure of the spares in respect of the goods imported by the respondent - appeal dismissed - decided against appellant.
Maintainability of appeal - quantum of appeal - Whether the unutilized CENVAT Credit legally earned by the respondent in their distillery division can be allowed for payment of Central Excise duty on Sugar? - Held that: - since the value involved in the present appeal is less than ₹ 15,00,000/- she has been instructed to withdraw the appeal in terms of the circular issued by the Central Board of Excise and Customs - appeal dismissed.
Validity of reopening of assessment - Held that:- The interdiction provided in the proviso appended to section 147 of the Income Tax puts an embargo upon the powers of the AO to issue notice under section 148 of the Income Tax Act, in cases where, the original assessment was made under section 143(3) and four years have expired. The AO has been denuded from his powers to issue notice in such cases unless it is established that income chargeable to tax has escaped the assessment on account of failure of the assessee to disclose all the material facts fully and truly in respect of its income. The AO has nowhere alleged any failure of the assessee. The ld.CIT(A) has rightly appreciated the facts - Decided against revenue.
Denial of opportunity of cross-examination - Held that:- It is evident that the assessee had been given sufficient opportunity in the matter. At no point of time, did he raise the plea that copies of the statements of such persons or such evidence ought to be supplied to him or that he intended to cross-examine them. In the absence of any such stand by the assessee before the Assessing Officer or any such demand by the assessee before the Assessing Officer, it is not open to him to turn around and claim that he has been denied the opportunity of cross-examination and the statements in question could not be used against him.
Considering the entirety of the evidence and materials which had come up against the assessee, including the huge amount of assets both moveable and immovable, investments made by the assessee, it could not be said that the said statements, which have been concurrently accepted as relevant or corroborative evidence or material used for the purpose of addition, could not have been taken into consideration.
Interim orders passed without giving adequate opportunity of being heard - Transfer of case u/s 127 - Held that:- A perusal of the orders of the Bench on various dates demonstrates that the Revenue is adopting delay tactics and is procrastinating the issue of production of records. This is not appreciated. It also gives us a feeling that there is no such order passed under section 127 of the Act giving jurisdiction to the concerned Assessing Officer.
No merit in the argument of the learned Departmental representative that the assessee could approach the Revenue under the Right to Information Act and hence the required orders on record need not be produced. Any document or record can be requisitioned by the Bench, if it is of the opinion that if the same is required for the disposal of the appeal. The assessee also submits that his application under the Right to Information Act was rejected by the Revenue. Thus, in our view the Bench, only on being convinced of the necessity of examining these records called for the said records and jurisdictional orders. The argument that interim orders were passed without the Bench being convinced of the reasons and necessity of summoning the record, is to say the least, unwarranted. These orders on different dates by different Benches cannot be said to have been passed without reason or without application of mind.
The argument of the learned Commissioner of Income-tax- Departmental representative are devoid of merit.
In view of the above discussions, we direct the Revenue to comply with the interim orders of this Bench. Adjournment is once again granted at the request of the earned Departmental representative as last opportunity.
Imposition of penalty - provisions of Rule 57 U(6) of CER, 1944 - Held that: - the appellant having availed the CENVAT credit on the basis of documents received by them from M/s. Simplex Engineering & Foundry Works showing the classification as falling under 8474.90, no malafide can also be attributable to them - penalty imposed upon the appellant is set aside - penalty set aside - appeal allowed - decided in favor of appellant.
The High Court Delhi allowed the petitioner to withdraw the petition with liberty to appeal to the Customs Excise and Service Tax Appellate Tribunal (CESTAT). The decision was influenced by a previous ruling quashing a Show Cause Notice for other co-noticees.
Denial of caim u/s.10(38) - AO disbelieved the purchase of shares by the assessees was that Shri. Mukesh Chokshi had given a statement in which he had mentioned providing accommodation entries to various persons in India, which included the names of the assessees along with the PAN - Held that:- None of the assessees had purchased shares from the said person. They had purchased shares from Stock-broking firms though through off-line deals. Assessees had produced brokers’ bill for the purchases. It might be true that assessees had purchased such shares at a rate lower than what was quoted in the market, but this, in my opinion would not be sufficient to treat the purchases to be bogus, when the prices were paid and concerned stock-brokers had delivered the shares. Assessees had also got the shares dematised later. Statement given by a party who was totally unrelated to the assessees could not be taken as evidence for disbelieving the evidence furnished by the assessees. Therefore denial of the claim u/s.10(38) of the Act, was not warranted. Additions made are deleted. - Decided in favour of assessee.
Revision u/s 263 - assessment against non-existing entity - Held that:- An invalid order cannot give birth to legally valid proceedings.
We find that in this case, the original assessment order passed under section 143(3) dated October 24, 2013, was null and void in the eyes of law as the same was passed upon a non-existing entity and, therefore, the learned Commissioner of Income-tax could not have assumed jurisdiction under the law to make revision of a non est order and, therefore, the impugned order passed under section 263 by the learned Commissioner of Income-tax is also nullity in the eyes of law and, therefore, the same is hereby quashed. - Decided in favour of assessee.
Penalty u/s. 271(1)(C) - assessee has claimed weighted deduction on purchase of Motor vehicles for employees - Held that:- The claim of deduction was denied which by itself would not justify the levy of penalty u/s. 271(1)(c) of the Act. The facts in issues are identical to the facts considered by the Hon’ble Supreme Court in the case of Reliance Petro Products [2010 (3) TMI 80 - SUPREME COURT ] wherein held a mere making of a claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the income of the assessee - Decided in favour of assessee.
Non-deduction of TDS - payment of transporting expenses for the sugarcane - The ld.First Appellate Authority was of the view that farmers were required to bring sugarcane upto the factory gate. Therefore, the assessee has not incurred any transportation expenses - Held that: - the issue in dispute is squarely covered in favour of the assessee by the orders of the ITAT as well as Hon’ble Gujarat High Court passed in assessee’s own case in Tax Appeal No.440 of 2006 - it was held in the case that the supply of sugarcanes at the gates of factories of the respective assesses was a part of sale transaction and thus, the assesses are not liable to deduct TDS - the order of the ld.CIT(A) upheld - appeal dismissed - decided against Revenue.
Duty drawback - rejection of application for fixation of brand rate of drawback - Rule 7 of the Customs, Central Excise Duties and Service Tax Drawback Rules, 1995 - delay in filing application - Held that: - the issue is covered by the decision of the Tribunal in the case of Amber Distilleries Ltd. Vs. CCE Thane-I [2016 (4) TMI 1197 - CESTAT MUMBAI], wherein it has been held that drawback being beneficial legislation need consideration in broader perspective and not in narrow compass and provision for condonation of delay up to 12 months in not filing brand rate application within three months, requires to be implemented in correct perspective - the application for fixation of brand rate in the present case needs to be considered by condoning the delay.
Rejection also on the ground that failure to declare figure 9801 as an identifier in the Shipping Bill under Drawback details - Held that: - the Hon’ble High Court of Bombay on the very issue in the case of Alfa Laval (India) Ltd. Versus Union of Inida [2014 (9) TMI 145 - BOMBAY HIGH COURT] has held that the C.B.E. & C. while clarifying the Rules, cannot impose limitations/restrictions thereon, which are clearly not provided for in the Rules, and accordingly, has the effect of whittling down the Rules, and that in the grab of clarification, the C.B.E. & C. cannot incorporate a restriction/limitation which did not find a place in the Rules - there is no bar to claim brand rate even if AIR has been claimed.
Matter is remanded to the original authority for fresh consideration - appeal allowed by way of remand.
Detention of goods - detention on the ground that without “e” transit pass, the goods are moved - offence u/s 70(2)(c), 71(3)(d), 71(3)(e) and 71(5)(a) of TNVAT Act, 2006 - Held that: - in Tvl.Sodhi Transport Co. and Another Vs.State of U.P [1986 (3) TMI 303 - SUPREME COURT OF INDIA], it was held that in case of non-surrender of transit pass, if a dealer could produce sufficient legally valid and reliable documentary evidence to prove that the goods moved with the transit pass in question had actually crossed the borders of the State, such evidences may be accepted by the Assessing Authority as an evidence of inter-state movement of goods. The officers of the Department were also cautioned that this cannot be accepted for repeated violations - this is the first occasion where the petitioner's goods have been detained and the petitioner has not come to the adverse notice of the Department on the earlier occasions - goods directed to be released with a direction to the petitioner to remit a sum of ₹ 2,000/- towards fine - petition allowed - decided in favor of petitioner.
Principle of mutuality - Co-operative Society - petitioner claim that the petitioner’s co-operative society bank limited activities are confined to its members whereas activities of the ordinary bank are open to the public at large. Therefore, the petitioner’s co-operative society bank limited does not fall within the purview of sub-section (10) of Section 65 of the Act - whether the co-operative society is liable to pay service tax?
Held that: - the petitioner is transacting the banking affairs and the business coming within the purview of banking and other financial services and this fact finds corroboration from the Form ST-3 which has been submitted by the petitioner concern expressing the same in the category of taxable services for which return was filed - Liability to pay service tax on the Contai Co-operative Bank Limited has been clarified by the Director General of Service Tax vide Annexure P4 clarifying that the service tax is required to be paid by the co-operative banks under the bank and other financial services.
The petitioner/Contai Co-operative Bank Limited is running banking and other financial services as per its object and has expressed itself in its bye-laws that wherever the word ‘society’ appears that be read as ‘Bank’. Therefore, by its own acts and deeds as depicted from the petition and reflected from the documents annexed to the writ application and also the documents annexed to the affidavit-in-opposition, this Court has no alternative but to hold that the petitioner is rendering services to its customers within the meaning of expression ‘taxable services” as defined under Section 65(105)(zm) and is liable to pay the service tax under FA notwithstanding the petitioner being registered under West Bengal Co-operative Societies Act, 1983.
Petition dismissed - decided against petitioner-assessee.
Assessment order passed u/s 143 (3)/153C - Held that:- We are inclined to concur with the submissions of the Ld. AR that the impugned order of the Assessing Officer ostensibly passed u/s 143(3) of the Act should be considered to have been passed u/s 153C read with section 143(3) in view of the decision rendered by the Hon'ble Delhi High Court in the case of Pr. Commissioner of Income Tax-2 vs Natural Products Bio- Tech Ltd. [2015 (9) TMI 1458 - DELHI HIGH COURT] held that no addition can be made in the assessment being framed u/s 153A, when there is no incriminating material or assets seized during the course of search. The finding of photocopies in the possession of a searched person does not necessarily mean and imply that they “belong” to the person who holds the originals - Possession of documents and possession of photocopies of documents are two separate things - Decided in favour of assessee.
CENVAT credit - inputs - denial for want of proper documents or original duty paying documents not submitted to Revenue - Held that: - there is no dispute as to the receipt of the goods in the factory and in the production of taxable output - The appellant is also directed to appear before the authority with the condition and the original copy of the invoice which has been returned here within the Court to the appellant, on examining which credit on document of Sl. No. 12 will be allowed - so far as rejection of the claim of credit on the document at Sl. Nos. 13 to 20 is concerned, the same is directive and accordingly, credit allowed on same - appeal allowed in part - part matter on remand.
Refusal of clearance of goods - import of alloy steel deformed bars - When the goods reached to Mumbai airport clearance were refused by the department on the ground that the consignment did not have a prior BIS Certification, which was necessary - Held that: - It is well settled that if a statute is curative or merely declaratory of the previous law retrospective operation is generally intended. In the absence of clear words indicating that the amending Act is declaratory, it would not be so construed when the pre-amended provision was clear and unamiguous and amending Act may be purely clarificatory to clear an amendment of the provision of the Principal Act, which was also implicit. Clarification amendment of this nature will have retrospective effect, and therefore, if Principal Act was existing law, when the Constitution came into force, amending Act also will be part of the existing law.
If we go through the notification/instruction dated 7-11-2014, it cannot be said that the same is clarificatory and apply retrospectively.
The application is allowed for amendment in the writ petition as prayed by Respondent No. 1 and are of the view that the learned Writ Court has not committed any legal error in entertaining the writ petitions and partly allowing it.
Appeal allowed - decided partly in favor of appellant.
MAT computation - inclusion of long term capital gain earned by a partnership firm, in which the assessee is the major partner in book profit computed u/s 115JB - Held that:- A partnership firm cannot become a share holder and hence it is not entitled to open a demat account. Hence the shares belonging to a partnership firm is usually held in the name of its partner. Further the partnership firm has filed declaration before the Registrar of Companies that it is the beneficial owner of the shares held by assessee company. Further the declaration in Form No. I, as prescribed under the section 187-C of the Companies Act, has also been filed by the assessee company to the companies in which shares were held declaring that the partnership firm is the beneficial owner of the shares. Hence we are of the view that the assessee has adopted a tax planning within the four corners of law and hence the same cannot be considered as a colourable device.
Further, the accounts of the assessee have been audited and the same has been approved by the Share holders by adopting the same in the Annual General Meeting. The Hon’ble Supreme Court has held in the case of Apollo Tyres Ltd (2002 (5) TMI 5 - SUPREME Court) that the accounts prepared and audited under the Companies Act, which has been approved by the share holders should not be disturbed by the assessing officer. It is also well settled proposition that the provision of sec. 115JB is a code by itself and hence the book profit has to be computed strictly in accordance with the said provisions. Under the provisions of sec. 115JB the share of profit from a partnership firm, which is exempt u/s 10(2A), is required to be excluded from book profit. In this view of the matter also, the action of the tax authorities cannot be upheld.
Accordingly we set aside the order of Ld CIT(A) and direct the AO to exclude the share income from the partnership firm while computing the book profit u/s 115JB - Decided in favour of assessee
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