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Showing 301 to 320 of 1529 Records
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2022 (6) TMI 1229
Rectification of mistake - error apparent on the face of record or not - import of induction cookers in the semi knocked down condition - mis-declaration of goods or not - MRP was declared in the bill of entry or not - demand of differential duty alongwith interest and penalty - HELD THAT:- In the proceedings before the Commissioner (Appeals) and CESTAT, the company has alone preferred the appeal and not the petitioner, but in the CESTAT order it has been referred as the petitioner and the company have preferred the appeal and thereafter, the appeal was allowed by setting aside the penalty imposed on the petitioner. Finding error apparent, the department has filed a petition and such reference of petitioner alone was deleted. In the CESTAT order, setting aside of penalty imposed has been accepted by the department and the department had not filed any appeal and hence, the CESTAT order has become final. The order of the CESTAT is that the imported products of the petitioner were not permitted for sale to the consumer before mandatory testing. The classification under the Custom Tariff Act, 1975 cannot provide the escapement from the legal metrology Act 2009. Goods that are not subject to prescription or declaration “maximum retail price” legal metrology Act, 2009 do not come within the ambit of Section 4 (a) of Central Excise Act 1944. In view of the same, the levy of differential duty in the order by the lower authority was set aside. Hence there is no mis-declaration.
The foundation aspect of the case proceeded by the department against the company as well as the petitioner is no more inexistence. The petitioner as managing director has been imposed penalty which is a consequent lapse on the part of the misdeclaration by the company. Further, the foundation aspect of the department is set aside. The petitioner, who was imposed consequential penalty, if proceeded, would be is eligible to the enure benefit of the order passed by the CESTAT - Petition allowed.
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2022 (6) TMI 1228
Maintainability of appeal - appeal dismissed on the ground of non-compliance of the mandatory required as contained u/s129 (e) of the Customs Act, 1962 - HELD THAT:- The issue is already decided in the case of RAHUL RAJVAIDHYA VERSUS CUSTOMS CENTRAL EXCISE AND SERVICE TAX [2019 (10) TMI 227 - MADHYA PRADESH HIGH COURT] where it was held that as the mandatory requirement of per-deposit as provided u/s 129 (e) has not been fulfilled, the Tribunal was justified in dismissing the appeal.
Following the above-mentioned order, the present appeal is also dismissed.
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2022 (6) TMI 1227
Classification of imported goods - goods declared as Polyester Bed Cover - the goods are Polyester Bed Cover or Polyester Fabric? - classifiable under Custom Tariff Heading 63041930 as declared by the Appellant or under Custom Tariff Heading 54075490 as claimed by revenue? - main contention of appellant is that department has not discharged the burden of proof of classifying the impugned goods under chapter 54 - applicability of case of MS SUNRISE TRADERS, JAI DURGA IMPEX, ALISHAN IMPEX, SATISH JINDAL, ADITYA LOOMTEX, TUSHAR TILAK, JMD TRADING CO, MOHIT SOIN, AJAY HIRALAL VIJ, JAI HANUMAN OVERSEAS, PANKAJ KUMAR KATARIA, PANKAJ KUMAR, SHREE SHYAM INTERNATIONAL AND TUSHAR GUPTA VERSUS C.C. -MUNDRA [2022 (1) TMI 468 - CESTAT AHMEDABAD].
HELD THAT:- In the relied upon order in the Textile Committee report, it was mentioned in the column of correct description and Classification of the sample that appropriate HS Code could not be provided due to rupture of yarn in weft while untwisting, the condition of having 85% texturised polyester yarn to classify under CTH 54075490 which is similar in the present set of appeals where warp is 38.4% texturised yarn and weft cannot be ascertained - Since we have already dealt the above reports of Textile Committee and ATIRA which are truly identical in nature, we find no reason to change our findings on the basis of the above reports as no new facts have been brought to our attention which warrants such a change. Since the revenue has not been able to discharge their burden of proof hence the classification of goods declared by the appellants cannot be disturbed.
Forgery of the textile committee report - HELD THAT:- There are no reason to go into the detail as the fact that reports were forged does not impact the classification assuming the reports relied upon by the department are the original one as was held in Sunrise Trader case.
Personal penalty on the charge of forgery of Textile Committee report, Mumbai on Bajrang Sharma, Amit Momamya and Mahesh Bhanushali - HELD THAT:- It is found that forgery is a very serious charge which should be proved by clear and cogent evidence which seems to be missing in the present case as two of them have retracted their statement and the statement of Mahesh Bhansuhali is the one left for which both the appellants have asked for cross examination which was denied by the lower authorities, which should have been given since other confessional statements were retracted. In our view imposition of penalty only on the basis of Mahesh Bhanushali is not tenable, hence set aside.
Moreover, when department’s claim of change of classification failed, the personal penalties being consequential to the main case of classification would also not sustain.
Appeal allowed - decided in favor of appellant.
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2022 (6) TMI 1226
Demand of bank guarantee to the extent of 15% of the value of seized goods - provisional release order already passed - power of department to review an order passed under Section 110A - review of the order to the extent it requires the Appellant to furnish a bank guarantee of 15% of value of the seized goods - HELD THAT:- In the present case, once the provisional release order was passed, the Office of the Deputy Commissioner of Customs, Ahmedabad, had no jurisdiction under the Customs Act to review the earlier order dated 4th February 2022 granting provisional release to the goods imported vide the Bills of Entry impugned in the present case. The correct approach would have been for the Respondent to challenge the correctness of the said provisional release order before this Tribunal.
Further, there have been no reasons provided in the order dated 6th April 2022 as to why the department has changed its stand by directing the appellant to furnish a bank guarantee to the extent of 15% of the value of the seized goods as against the original condition mentioned in the provisional order dated 4th February 2022 which was to provide a bank guarantee to the extent of 15% of the duty payable.
In TG ENTERPRISE VERSUS UNION OF INDIA], the Hon‘ble Gujarat High court, in a case relating to alleged mis-declaration of country of Origin, was looking into the challenge to the provisional release condition by which the Petitioner was directed to furnish a Bank Guarantee to the extent of 25% of differential duty amount. The High court was pleased to set aside the said condition by observing that Of course further investigation is going on and we cannot foresee what further evidence may be collected. Be that as it may, when yet show-cause notice for final adjudication has not been issued and even after issuance of show-cause notice, completion of the adjudication is bound to consume time, it would not be in anyone's interest to stop the clearance of goods when it is not the case of the department that the import of such materials has any other legal impediment.
In the present case undisputedly, nothing has been placed on record showing any undervaluation of goods. While the department has submitted before the Commissioner (Appeals) that the issue of valuation is under investigation, however what cannot be ignored is that the goods imported are copper cathodes and the value of the same is determined basis the LME price. Also the provisional release order dated 06.04.2022 and the seizure memo dated 02.02.2022 is totally silent on the aspect of undervaluation. The seizure memo in fact gives the complete history of the matter but does not contain any allegation about the undervaluation of goods. Given the above it is submitted that the condition to furnish BG of 15% of value is extremely onerous, more so when the Appellant has shown his will to deposit entire amount of duty on value declared by it.
In the present case, as evident from the Bills of entry, the appellant was always willing to deposit the entire duty of BCD + IGST which is over 25 crores and therefore, the condition to direct the appellant to furnish a bank guarantee of 15% of the value of the goods which is over 100 crores is excessive and arbitrary more importantly when the appellant is willing to deposit the duty payable on the seized goods. There is no dispute on the valuation or classification of the goods as is clear from the impugned provisional order. The provisional release order dated 06.04.2022 and the seizure memo dated 02.02.2022 does not mention anything about undervaluation as has been argued by the department before the Commissioner (Appeals) - Even before this Hon‘ble Tribunal no evidence has been placed to show any under valuation of goods.
It is also found that a perusal of the seizure memo clarifies that it is the case of the department that the goods in the present case were imported from Iran as against the declared country viz., Zambia. Keeping the allegation in mind, the department had seized the goods imported vide 4 impugned Bills of Entry. The argument of the appellant that no benefit is accrued to the appellant by allegedly mis-declaring the Country of Origin as they were always willing to pay the entire duty payable on these goods without even the considering the said COO cannot be ruled out and have to borne in mind when conditions for provisional release was decided under the approval of the Respondent - Further it is a settled law that an importer unless proven otherwise beyond doubt cannot be said to have any role in the issuance of a COO as the same is issued by the competent authority of the originating country. However, at this point in time, it is also important to note that the investigation is ongoing and country of origin of the goods will be determined only after the investigation is concluded. At this point of time, it cannot be said with certainty that the goods were imported from Iran. Be that as it may, the issue before this Tribunal is limited to the provisional release of goods and the same be decided keeping in mind the fact that the Appellant never intended to avail any benefit basis the COO and were and are willing to pay the duty on the goods imported vide the 4 bills of entry.
The order of Commissioner (Appeals) is liable to be set aside to the extent it directs provision of BG of 15% of value of goods - the ends of justice shall be met if the appellant is allowed the provisional release of the subject imported goods on execution of Bond of full value of such goods and furnishing the bank guarantee of Rs.1 Crore - Appeal allowed.
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2022 (6) TMI 1225
Levy of penalty u/s 112(a) of the Customs Act, 1962 - Allegation of evasion of anti-dumping duty - mis-declaring the country of origin as Malaysia, instead of China - penalty imposed upon the appellants Jayesh Mehta and Harshad Vadodaria on the ground that appellants herein have aided and abetted the importer in importing the goods by way of mis-declaring the country of origin - validity of SCN - appellant points out that impugned order imposed penalty under section 112 (a) of the Act whereas show cause notice proposed penalty under section 112 (b) of the Act - appropriation of amounts deposited by or on behalf of company during investigation towards duty and interest liability - HELD THAT:- The appellants said role in relation to import of goods is not borne out of facts on record. Significantly, the case of the department of mis-declaration of Chinese origin goods for evading anti-dumping duty is wholly directed against Nalin Mehta. Jayesh Mehta has stated in his statement that he attended the work of customs clearance as representative of CHA and acted upon the direction of Nalin Mehta. There is no evidence to show that at the time of imports he was aware that goods were allegedly being mis-declared by Nalin Mehta to customs. Harshad Vadodaria has specifically stated in his statement that he was not aware that by using his factory’s name and IEC Nalin Mehta and Jayesh Mehta indulged in evasion of anti-dumping duty by mis-declaring the country of origin. There is no other reliable and corroborative evidence to establish that appellants herein had knowledge that goods imported were of Chinese Origin, in that view it cannot be said that appellants herein have committed any act or omission, which rendered the goods liable to confiscation, accordingly penalty under section 112 (a) cannot be sustained.
Validity of SCN - HELD THAT: - The impugned order imposed penalty under section 112 (a) whereas show cause notice invoked section 112 (b) of the Act, appellants herein were not put to notice under section 112 (a), the same cannot sustain in view of judgement in the case of AMRIT FOODS VERSUS COMMISSIONER OF CENTRAL EXCISE, UP. [2005 (10) TMI 96 - SUPREME COURT] where The Tribunal has set aside the order of the Commissioner on the ground that neither the show cause notice nor the order of the Commissioner specified which particular clause of Rule 173Q had been allegedly contravened by the appellant. We are of the view that the finding of the Tribunal is correct. Rule 173Q contains six clauses the contents of which are not same. It was, therefore, necessary for the assessee to be put on notice as to the exact nature of contravention for which the assessee was liable under the provisions of the 173Q. This not having been done the Tribunal's finding cannot be faulted.
Appropriation of amounts deposited by or on behalf of company, Shobha Plastics, during investigation towards duty and interest liability - HELD THAT:- As regards, Shobha Plastics, it is seen that vide Order dated 05.11.2008 the Commissioner of Customs, Ahmedabad fastened duty liability jointly and severally upon Shobha Plastics and Nalin Mehta. However, the said Order dated 05.11.2008 was set aside by Tribunal vide its Order dated 15.04.2009 with a direction to the Commissioner to fix duty liabilities on each and every individual separately. Accordingly, Commissioner vide his common Order dated 19.01.2011 held Nalin Mehta to be the importer of the goods and fixed duty liability upon him along with interest and penalties. The present appellant, Shobha Plastics was not held liable to duty. Department has not preferred appeal against that order dated 19.01.2011 and hence the same has attained finality. In that view, appropriation of amounts deposited by or on behalf of Shobha Plastics during investigation towards duty and interest liability in the impugned order cannot be sustained.
Appeal allowed - decided in favor of appellant.
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2022 (6) TMI 1224
Refund claim - rejection of refund on the ground that the same was not deposited in the name of the Appellant - HELD THAT:- Having regard to the fact that proof of email reply fully acknowledged that demand draft was drawn with money transferred from the bank account of Appellant, it can be said without the slightest hesitation that the submission made by the Appellant before the Commissioner of Customs (Appeals) that has been recorded in para 5 of his Order-in-Appeal are true. The obvious reason for such wrong noting of draft in someone else’s name could be a clerical error and could be remanded at the Respondent-Department’s ends to facilitate refund of the disputed amount to the Appellant in compliance to the provision of refund available in the Customs Act, 1962 concerning refund.
It is deemed proper to remand the matter back to the Original Authority for a fresh decision upon verification of bank documents produced by the Appellant before them and received by the Respondent-Department directly from the bank - appeal allowed by way of remand.
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2022 (6) TMI 1223
Oppression and mismanagement - Seeking order and direct conduct of due election of the Board of Directors for managing the affairs of the 4th Respondent company - seeking appointment of a commissioner for conduct of such election - seeking direction that the management of the affairs of the 4th respondent company be entrusted to the Board of Directors so elected - HELD THAT:- On 23.06.2017 Alexander Correya and Others filed a Petition against M/s. Bhagyodayam Company and Others (TCP/21/KOB/2019) under Section 241 and 242 of the Companies Act, 2013 alleging acts of oppression and mismanagement. Vide order dated 28.08.2018 the NCLT Chennai Bench passed an order superseding the Board of Directors appointing an Administrator and who took control of the 4th Respondent Company. Respondents 5 to 9 herein who are superseded Managing Director and Trustees preferred Company Appeal No. (AT) 338/2018, and Respondents 10 to 12 herein preferred Company Appeal No. (AT) 439/2018 before the Hon'ble NCLAT. The Hon'ble NCLAT, Delhi heard the appeals in detail on 23.07.2020, and vide order dated 23.07.2020 dismissed the appeals upholding the findings of the Hon'ble NCLAT, Chennai. On dismissal of the Appeals, Respondents 5 to 9 herein, preferred Civil Appeal 2999/2020 before the Hon'ble Supreme Court. The Hon’ble Supreme Court of India heard the Appeal in detail on 19.11.2020 and rejected all the contentions raised by the Appellants therein and dismissed the Civil Appeal No. 2999/2020 vide judgment dated 19.11.2020.
Since all the contentions raised by the Respondents/ superseded Managing Directors and Trustees before the NCLT Chennai Bench have been rejected by that Bench, which was appealed before Hon’ble NCLAT and Hon’ble Supreme Court and there also they failed, these Petitioners who are stated to be binamis of the suspended Managing Directors and Trustees cannot now come forward with an application for impleadment at this belated stage. Hence, the contention for an impleadment need not be considered.
Whether an order as sought for by the Intervening Petitioners can be granted? - HELD THAT:- The request of the interveners to conduct the Board meeting has not been specifically denied by the present Administrator. Instead, he is harping on the allegations raised by the former Administrator that the Auditor has not properly audited the accounts. Lame excuses to conduct the election cannot be accepted for not conducting the election. The Tribunal cannot be a moot spectator in the matter. In order to give an end to the issue involved and in the interest of justice, it is high time to order for conducting the election to the Board of Directors of the 4th Respondent Company in terms of the Articles of Association of the 4th respondent Company. It is not necessary to appoint a Commissioner for the conduct of such an election, as the administrator is competent to conduct the election.
The Administrator is directed to conduct the election to the Board of Directors of the 4th respondent Company as early as possible, at any rate, within 45 days from the date of receipt of a copy of this order - petition disposed off.
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2022 (6) TMI 1222
Violation of principles of natural justice - Non-speaking order - grievance of the Appellant is that the Impugned order suffers from serious infirmity in the eye of law because of the fact that the said order is bereft and devoid of reasons, for want of material particulars in explaining necessary qualitative and quantitative reasons, for arriving at the just conclusion - HELD THAT:- Considering the fact that the Impugned Order suffers from infirmity in the eye of law, therefore, it cannot stand a moment scrutiny in law, especially, for want of qualitative and quantitative reasons being ascribed thereto in the said Order and especially the said order is a cryptic and unreasoned one, which necessitates an inevitable conclusion to be arrived at, by this Tribunal, that the same is not valid in law.
This Tribunal is inclined to interfere to the said Impugned order for substantial cause of justice. The Impugned Order dated 24.05.2022 in IA/320/CHE/2021 in CP/1156/IB/2018 passed by the Adjudicating Authority’ (National Company Law Tribunal, Division Bench-1, Chennai) in CP/1156/IB/2018 is hereby set aside - the matter is remitted back to the Adjudicating Authority (National Company Law Tribunal, Division Bench-1, Chennai) and the Adjudicating Authority (National Company Law Tribunal, Division Bench-1, Chennai) is directed to take up IA/320/CHE/2021 in CP/1156/IB/2018 for Hearing de novo and to dispose of the same, by passing a reasoned ‘Speaking Order’ on merits, of course, after providing adequate opportunities to both the parties, in accordance with law.
Appeal disposed off.
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2022 (6) TMI 1221
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - HELD THAT:- It can be seen from the records of the proceedings placed, that since the Corporate Debtor's account has been classified as fraudulent transaction by the banker and the Corporate Debtor is unable to infuse more funds and submit better proposal for OTS. However, CIRP to be initiated on the Corporate Debtor and it is proved that there is a debt and default on the part of the Corporate Debtor.
In view of the 'financial debt' which is proved by the Financial Creditor and the 'default' being committed on the part of the Corporate Debtor, this Tribunal is left with no other option than to proceed with the present case and initiate the Corporate Insolvency Resolution Process in relation to the Corporate Debtor - Application admitted - moratorium declared.
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2022 (6) TMI 1220
Maintainability of application - initiation of CIRP - Corporate debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - HELD THAT:- Upon perusal of the records and documents annexed with the Petition, it is observed that the amount was disbursed to the Corporate Debtor and the default subsists. Thus, the amount is legally due and payable to the Corporate Debtor.
The application made by the Financial Creditor is complete in all respects as required by law. It clearly shows that the Corporate Debtor is in default of a debt due and payable, and the default is in excess of minimum amount stipulated under section 4(1) of the IBC. Therefore, the debt and default stands established and there is no reason to deny the admission of the Petition. In view of this, this Adjudicating Authority admits this Petition and orders initiation of CIRP against the Corporate Debtor - Petition admitted - moratorium declared.
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2022 (6) TMI 1219
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - exisence of debt and dispute or not - HELD THAT:- It is evident from the documents on record that the advance was availed from the Financial Creditor by the Corporate Debtor and that amount was duly disbursed to the Corporate Debtor from time to time. The balance confirmation statement which has also been signed by the Corporate Debtor evidences the fact that the amount was disbursed and the same is an acknowlegement of liability. In addition to the balance confirmation statement the liability of the Corporate Debtor is clearly reflected in the balance sheet of the Corporate Debtor.
It is abundantly clear that the Corporate Debtor owes a financial debt to the Financial Creditor. There is Balance confirmation by the Corporate Debtor of the dues payable to the Financial Creditor. On account of its acknowlegement of debt the Corporate Debtor has confirmed the amount as stipulated in the confirmation of accounts dated 15.04.2017, due and payable to the Financial Creditor. The Financial Creditor submits that in view of the Corporate Debtor’s loan having become due and payable on demand and its failure and inability to pay the same, the Petition to be admitted - this Bench is of the considered opinion that there is no dispute regarding the fact that Corporate Debtor owes money to the Financial Creditor.
The application made by the Financial Creditor is complete in all respects as required by law. It clearly shows that the Corporate Debtor is in default of a debt due and payable, and the default is in excess of minimum amount stipulated under section 4(1) of the IBC. Therefore, the debt and default stands established and there is no reason to deny the admission of the Petition. In view of this, this Adjudicating Authority admits this Petition and orders initiation of CIRP against the Corporate Debtor.
Petition admitted - moratorium declared.
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2022 (6) TMI 1218
Seeking dissolution of the company - Section 59 of the Insolvency and Bankruptcy Code, 2016 - HELD THAT:- A bare perusal of the material available on record shows that the Board of Directors of the Company has taken a conscious decision for closing down the company, because the company has no significant business operations from last two years. Thus, the Board of Directors of the company have unanimously proposed to liquidate the company by invoking the provisions of voluntary liquidation under Section 59 of the Code - It has been mentioned in the petition that the liquidator has not received any claims, therefore, no prejudice and loss will be caused to anyone, if the company is dissolved. In support of the same, the company has duly passed the requisite Special Resolution in its Extra Ordinary General Meeting on 06.08.2020 by confirming the decision of its Board of Directors and proposing for its Voluntary Liquidation.
From the perusal of the record of the case, it is seen that the Liquidator, after his appointment has duly performed his duties and completed necessary formalities to complete the liquidation process of the applicant company, which has been averred in the present petition and, thus, the liquidator has prayed for an order from this Tribunal to dissolve the applicant company.
Since there is no objection received from any angle opposing the proposed voluntary liquidation/dissolution of the company either from the side of the shareholders or from creditors, nor any adverse comment have been received from the public at large against such liquidation/dissolution, despite there being a public announcement by the liquidator and also updation of the same in the website of the Insolvency and Bankruptcy Board of India (IBBI). It is also evident from the record that the proposed liquidation was duly communicated to the Registrar of Companies, NCT of Delhi & Haryana as per Form MGT-14 and Form GNL-2 and the same is also reported to have been approved.
Apart, as per record of the present case, it is seen that the company is not found involved in such kind of business activities, which are detrimental to the interest of public at large. Further, it is not the case that the proposed liquidation may affect adversely to its shareholders/members or is contrary to the provisions of law - the present application deserves to be allowed for the proposed Liquidation/Dissolution of the Corporate Person.
This Adjudicating Authority in exercise of power conferred to it under Section 59 (8) of the Insolvency and Bankruptcy Code, 2016, orders that the Corporate Person (Applicant Company) SAIF Advisors Private Limited shall stand dissolved with effect from 27.06.2022 - application allowed.
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2022 (6) TMI 1217
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - HELD THAT:- As per the direction of this Tribunal, the learned PCS for the applicant filed the record of default of NeSL website, from which it is clear that the Corporate Debtor has committed default in repayment of its credit facilities availed from the Financial Creditor by way of various credit facilities sanctioned, granted and disbursed by the Applicant. The record produced by the applicant received from the Information Utility shows as “Deemed to be Authenticated”. The status of authentication as “Deemed to be Authenticated” is prima facie evidence for smooth admission under Section 7 of the IBC.
It is relevant to note that Hon’ble Supreme Court of India in the case of M/S. INNOVENTIVE INDUSTRIES LTD. VERSUS ICICI BANK & ANR., [2017 (9) TMI 58 - SUPREME COURT], has laid down the guiding principles to admit or reject an application filed under Section 7 of the IBC.
To admit an application filed under Section 7 of IBC, the Adjudicating Authority is to be satisfied that a default has occurred; that the Corporate Debtor is entitled to point out that default has not occurred in the sense that the "debt", which may also include a disputed claim, is not due. A debt may not be due if it is not payable in law or in fact. The moment the Adjudicating Authority is satisfied that a default has occurred, the Application must be admitted unless it is incomplete.
The application made by the Financial Creditor is complete in all respects as required by law. It clearly shows that the Corporate Debtor is in default of a debt due and payable, and the default is in excess of the minimum amount stipulated under Section 4(1) of the IBC. Therefore, the debt and default stand established and there is no reason to deny the admission of the Petition.
Petition admitted - moratorium declared.
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2022 (6) TMI 1216
Seeking handover possession of four Apartments during the period when CIRP was going on - whether during the period of CIRP, the relief sought by the applicant to handover possession of four Apartments to the applicant can be allowed? - HELD THAT:- A reading of Section 43(2)(b) of the IBC, 2016, would make it clear that if the prayer of the applicant is allowed which will be in the nature of transferring/alienating or disposing off the Corporate Debtor any of its assets or any legal rights or beneficial interest therein. This will result in change in the status of the assets of the Corporate Debtor after the commencement of Insolvency Resolution Process. The transfer has the effect of putting such Creditor or surety or a guarantor in a beneficial position than it would have been in the event of a distribution of assets being made in accordance with Section 53. Moreover, while admitting the application moratorium has been ordered under Section 14 of the IBC.
The RP cannot handover the possession of the four Apartments to the applicant. The applicant is to wait till the CIRP is concluded - Application dismissed.
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2022 (6) TMI 1215
Seeking direction to respondents to provide the books of accounts and all the relevant information in respect of the Corporate Debtor - seeking direction to assist the IRP to identify the company assets - handing over the Keys of the factory gate and extension of all the support and cooperation to complete the CIR Process - HELD THAT:- Independent of all the legal proceedings pending, the respondent preferred a proposal for One Time Settlement (OTS) before the Financial Creditor and also the Interim Resolution Professional appointed by this Tribunal. While the proposal for OTS preferred by the respondent was pending consideration with the Financial Creditor, the WP No. 15804 of 2022 was disposed off with a direction to the Resolution Professional to place the proposal before the Committee of Creditors (CoC) at the next meeting. Thereupon, the proposal for OTS has been sanctioned by the Financial Creditor and the same was communicated to the respondent vide letter dated 04/06/2022 issued by the Financial Creditor. In view of the OTS approved by the Financial Creditor, the respondent should be permitted to settle his entire liability towards the Financial Creditor within the time stipulated in the OTS.
On going through the OTS proposal, which was approved by the Financial Creditor who has filed the CP(IB)/34(KOB)/2021, it is seen that the respondent can clear the liability to the Financial Creditor by 31/07/2022. It is also stated that if the claim of the Bank of Rs.105 lakh is paid as per the OTS approved, the Bank is ready to withdraw their claim before the CoC. It is also stated that if the Corporate Debtor delays the payment instalments, that will attract interest at the rate of 9% - Since the Corporate Debtor/Respondent has got time upto 31/07/2022, the prayer of the IRP to provide the books of accounts, and all the relevant information in respect of the Corporate Debtor, assist the IRP to identify the company assets, handover the Keys of the factory gate and extend all the support and cooperation to complete the CIR Process cannot be granted at present, as the Financial Creditor who has filed the case before this Tribunal has agreed to the OTS, presumably with the approval of CoC, the IRP has to wait till the cut off date provided in the OTS approval.
Application dismissed.
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2022 (6) TMI 1214
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - HELD THAT:- The Counsel for the Corporate Debtor, during the course of hearing of the matter, on 13.04.2022 has admitted the liability and claim filed by the Operational Creditor. The Counsel for the Corporate Debtor further submitted that the admission is made as per the instructions of her client and, as on date, the Corporate Debtor is unable to pay the amount claimed in the section 9 application - It is clear from the order of Tribunal that the Counsel for the Corporate Debtor has specifically admitted the debt and submitted to the Tribunal to pass appropriate orders. The counsel for the Corporate Debtor, on instructions of her client, has therefore admitted the debt and default.
Upon appreciation of the documents placed on record to substantiate their respective claims, this Adjudicating Authority is of the view that there is an operational debt which is due from the Corporate Debtor and the Corporate Debtor has defaulted in making payment of the amount due and accepted the said default. Therefore, in the absence of any pre-existing dispute, this tribunal admits this application and initiates CIRP on the Corporate Debtor with immediate effect.
Application admitted - moratorium declared.
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2022 (6) TMI 1213
Seeking grant of bail - Money Laundering - present applicant-Hemant Kumar Sinha was the Chief Secretary of the trust and it was alleged that the trust was engaged in collecting money from the public by cheating the poor people and inducing them to invest money which would become fourfold within 16 months - applicability of provisions of Section 45(1) of PMLA - HELD THAT:- This Court is of the considered view that the provisions of Section 45 of the Act, 2002 prior to judgment of Hon’ble Apex Court in the case of NIKESH TARACHAND SHAH VERSUS UNION OF INDIA AND ANR. [2017 (11) TMI 1336 - SUPREME COURT] was declared unconstitutional; but the defects of provisions of the said act was cured by the Parliament by way of Amendment Act 13 of 2018 and consequently, the twin conditions of Section 45 while disposing of the bail applicant under the Act, 2002 stood revived.
The twin conditions under Section 45 (1) for the offences classified thereunder in Part-A of the Schedule was held arbitrary and discriminatory and invalid in Nikesh Tarachand Shah. Subsequently, the Section 45 of the Act, 2002 has been amended by Amendment Act 13 of 2008, whereby the words “imprisonment for a terms of imprisonment of more than three years under Part A of the schedule” has been substituted with “accused of an offence under this Act".
The Hon’ble Apex Court in THE ASST. DIRECTOR ENFORCEMENT DIRECTORATE VERSUS DR. V.C. MOHAN [2022 (1) TMI 511 - SUPREME COURT] held once the prayer for bail is made for the offence under PMLA 2002, the rigors & principle underlying Section of 45 get triggered on.
There are reasonable ground to believe that the applicant is guilty of the offence of money laundering and he is likely to commit the offence, if enlarged on bail - bail application dismissed.
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2022 (6) TMI 1212
Extended period of Limitation - suppression of facts or not - details of trading was available in the Balance Sheet of the respondent during the relevant period and that there was much confusion during the relevant period as to whether credit could be availed in respect of trading activities and the issue was in litigation leading to perversity - mere availability of details of trading in Balance Sheet is sufficient to drop the demand for extended period on the ground that there was no suppression, or not - attributing the prior knowledge of trading activity of the respondent ignoring the fact that the respondent produced the Balance Sheet only during the investigation and not prior to that.
HELD THAT:- Undisputed facts of the case are, as recorded in paragraph 6 of the show cause notice, it was issued based on the balance sheet for the year ending 2008. Thus, the contentions of the Revenue that respondents trading activity was not known to the department and that it was learnt based on intelligence report are not tenable.
The substantial questions raised by the Revenue are answered in favour of the assessee - Appeal dismissed.
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2022 (6) TMI 1211
Levy of Penalty u/r 26 of CER, 2002 - Allegation of clandestine removal - Failure to account for the manufactured goods properly and on visit of the officers, the excess goods were found which was lying unaccounted - Polished vitrified Tiles - appellant claims that the unaccountal of goods is due to mis-match and cessation of the factory and the concerned staff has left the job - Confiscation of such excess found goods - Redemption Fine - Penalty - HELD THAT:- It is found from the facts, that the appellant in his statements recorded by the investigating agency nowhere stated that the goods found excess in the factory were lying for clandestine removal therefore, the serious allegation made by the department that the goods were kept for clandestine removal without payment of duty is not supported by any evidence. The appellant has stated in their statement that the unaccountal of goods is due to mis-match and cessation of the factory and the concerned staff has left the job therefore, even though the goods were found unaccounted for which the company has been imposed with redemption fine and penalty, personal penalty cannot be imposed on the Chairman and MD of the company who is not looking after the accountal of the goods manufactured. The only lapse on the part is that being the Chairman and MD of the company, he has not ensured that the proper accounting of the finished goods is being done or not for which a token penalty can be imposed.
The penalty is reduced from Rs. 5 Lacs to Rs.1 Lac - the impugned order stands modified to the above extent - Appeal allowed in part.
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2022 (6) TMI 1210
Classification of goods - Bread-Rusk - Process of manufacturing - to be classified under Entry 9 of Schedule B of the HPVAT Act or is classified as an unlisted item under the residual entry i.e. Part III of Schedule A of the HPVAT Act and subject to VAT @ 12.5% (subsequently increased to 13.5%)? - Burden/onus to prove - HELD THAT:- It needs to be borne in mind that it is now well settled principle of law that in interpreting different entries, attempts shall be made to find out as to whether the same answers the description of the contents of the basic entry and only in the event it is not possible to do so, recourse to the residuary entry should be taken by way of last resort.
Hon'ble Supreme Court in MAURI YEAST INDIA PVT. LTD. VERSUS STATE OF UP. [2008 (4) TMI 101 - SUPREME COURT] has held that if there is a conflict between two entries one leading to an opinion that it comes within the purview of the tariff entry and another the residuary entry, the former should be preferred.
As regards the contention of the respondents that the Rusk would fall under residuary entry, the burden of proof is on the respondents and the onus also lies on them to first establish conclusively that by no conceivable process of reasoning can the said product be brought under any of the tariff items and hence the product was being brought under any of the tariff items, hence the product was being brought under the residuary item - Hon'ble Supreme Court in PUMA AYURVEDIC HERBAL (P) LTD. VERSUS COMMISSIONER OF C. EX., NAGPUR [2006 (3) TMI 141 - SUPREME COURT] has held that It is settled law that the burden of showing correct classification lies on the revenue." If we look at the facts of the instant case there does not appear to have been any strong evidence led by the revenue before the authorities to establish the fact that the matter would not fall within the entry item "bread" as is reflected under schedule-1, entry-7 of the VAT Act.
The burden or onus is on the respondent authorities to establish by placing on record cogent, convincing and substantive evidence to show that Rusk is not Bread so as to bring it under the residuary entry under Part-IV of Schedule-B so as to impose tax on Rusk and Toast at the rate specified under the residuary entry.
Once the Court agrees that the raw material as also the manufacturing process for Bread and Rusk is same and thereafter only the moisture is extracted, would not term that activity to be falling within the meaning of “manufacturer” as used in the Act.
Petition allowed.
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