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Showing 321 to 340 of 1410 Records
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2020 (12) TMI 1093
Grant of Anticipatory Bail - Money Laundering - proceeds of crime - allegation that the persons named Sarith, Swapna and Sundeep along with several other accused smuggled primary gold from abroad through diplomatic channel of UAE consulate - HELD THAT:- There is no specific provision in the Money Laundering Act dealing with granting of anticipatory bail. The act of money laundering has both civil and criminal repercussions which the offender may have to face. Apart from adjudication, the perpetrator of the crime will also have to face penal consequences. The provisions would indicate that authorities for the purpose of the Act who can take action for violation of the provisions in the Act are the Director, Additional Director, Deputy Director, Joint Director, Assistant Director and such other classes of officers as may be appointed for the purpose under Section 48 of the PMLA. The fact that very senior and experienced officers are empowered to act against the offenders of the PMLA itself would indicate the extent of caution and experience they have to deploy before implicating anyone as an accused or an offender.
Under the PMLA, the authorites under the Act are bound to carry out investigation by collecting evidence and for that purpose, they have been sufficiently empowered to summon persons or require them to produce evidence, records, statements and also carry out searches of properties and persons, and even properties can also be seized or attached. But, the fact that very senior officers are alone empowered to proceed in arresting an offender indicates that they would do so only on having sufficient grounds to arrest the person. If that be so, the fact is that the applicant has not yet been made an accused and that he is only required for the purpose of interrogation by the officers of ED and it will have to be concluded that the prayer for anticipatory bail made by the applicant is premature. Even though the applicant is intended to be made an accused on sufficient materials being collected against him, considering the gravity of the offences under the PMLA, the applicant definitely may not be entitled to the extraordinary relief of pre-arrest bail - this Court is not inclined to restrain the applicant from being arrested and the prayer for pre-arrest bail is also premature.
The application for anticipatory bail is dismissed.
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2020 (12) TMI 1092
Valuation of imported goods - The Commissioner (Appeals) set aside the order of enhancement in value - polyester knitted fabric of different weights and colours - enhancement of assessable value, on the basis of contemporaneous imports data - HELD THAT:- In the present case, the proper officer doubted the truth or accuracy of the value declared by the importer for the reason that contemporaneous data had a significantly higher value. It was open to the importers to require the proper officer to intimate the grounds in writing for doubting the truth or accuracy of the value declared by them and seek a reasonable opportunity of being heard, but they did not do so. On the other hand, the importers submitted in writing that though they had declared the value of the imported goods at 1.20 USD per kg., but on being shown contemporaneous data, they have agreed that the value of the goods should be enhanced to 1.80 USD per kg for Hanuman Prasad and to 1.94 USD per kg. for Niraj Silk. The importers also specifically stated that they did not want to avail of the right conferred on them under section 124 of the Customs Act and, therefore, they did not want any show cause notice to be issued to them or personal hearing to be provided to them. The importers also specifically stated that they did not want a speaking order to be passed on the Bills of Entry. It needs to be noted that section 124 of the Customs Act provides for issuance of a show cause notice and personal hearing, and section 17(5) of the Customs Act requires a speaking order to be passed on the Bills of Entry, except in a case where the importer/exporter confirms the acceptance in writing.
It is non-consideration of the factual position emerging from the statements made by Hanuman Prasad and Niraj Silk that led the Commissioner (Appeals) to believe that the declared value could be rejected only on the basis of reasonable and cogent evidence, which burden the Revenue failed to discharge as it could not prove that the invoice did not represent the true transaction value in the international market.
The very fact that the importers had agreed for enhancement of the declared value in the letters submitted by them to the assessing authority, itself implies that the importers had not accepted the value declared by them in the Bills of Entry. The value declared in the Bills of Entry, therefore, automatically stood rejected. Further, once the importers had accepted the enhanced value, it was really not necessary for the assessing authority to undertake the exercise of determining the value of the declared goods under the provisions of rules 4 to 9 of the Valuation Rules - here, the importers had accepted the enhanced value and there was, therefore, no necessity for the assessing officer to determine the value in the manner provided for in rules 4 to 9 of the Valuation Rules sequentially.
The general observations made the Commissioner (Appeals) in the impugned order that the value declared in the Bills of Entry were being enhanced uniformly by the Department for a considerable period of time was uncalled for. The Commissioner (Appeals) completely failed to advert to the crucial aspect that the importers had themselves accepted the enhanced value. The Commissioner (Appeals) in fact, proceeded to examine the matter as if the assessing officer had enhanced the declared value on the basis of other factors and not on the acceptance by the importers. This casual observation is not based on the factual position that emerges from the records of the case - the Commissioner (Appeals) was not justified in setting aside the orders passed by the assessing officer on the Bills of Entry.
Appeal allowed - decided in favor of appellant.
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2020 (12) TMI 1091
Approval of Scheme of Arrangement - Sections 230 to 232 of Companies Act, 2013, R/w Companies (Compromises, Arrangements and Amalgamation) Rules, 2016 - HELD THAT:- In his report, the Regional Director, MCA has concluded that the Scheme appears to be fair, reasonable and not detrimental against the Members or Creditors or contrary to public policy and the same can be approved. The issue of CIN has been satisfactorily explained. The minor discrepancy has occurred due to the year of incorporation and year of transfer only, and would not come in the way of sanction of the Scheme of Arrangement. It appears that the Scheme will enable better control and visibility over the resources of the dormant entities, since pursuant to the merger they shall be consolidated into the Resulting Company and will help in reducing the costs and efforts involved in performing statutory compliances for multiple entities, etc. Hence, the Scheme appears to be guided by commercial expediency. On a consideration of the facts, which are not elaborated again here to avoid duplication and repetition, we are satisfied that the procedure specified in sub-sections (1) and (2) of section 232 of the Companies Act, 2013 has been complied with, and hence the Scheme of Arrangement, as approved by the Boards of both the Transferor Company and the Resulting Company, is hereby sanctioned.
The scheme is sanctioned - application allowed.
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2020 (12) TMI 1090
Restoration of the name of the struck off company in the Register of Companies - Section 252(3) of the Companies Act, 2013 - HELD THAT:- From the perusal of the Financial Statements for the year ended 31.03.2020, it is established that company is having trading operations and assets and liabilities as well. It is also noted that from this year only that extent of operations has increased. It has also been pleaded before us that company hopes to increase business volume in future. Accordingly, the name of the company needs to be restored in the Register of companies maintained by ROC, subject to payment of suitable cost for non-compliance of requirements of filing of statutory returns.
The Applicant Company is directed to file all pending statutory document(s) including Annual Accounts and Annual returns for the financial years in default along with prescribed fees/additional fee/fine as decided by ROC within 45 days from the date on which its name is restored on the Register of Companies by the RoC - Application allowed.
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2020 (12) TMI 1089
Restoration of name of the Petitioner Company, on the Register of Companies maintained by the Registrar of Companies - section 252 (3) of the Companies Act, 2013 R/w Rule 87A of the NCLT (Amendment) Rules, 2017 - HELD THAT:- Section 248(6) states that the Registrar of Companies, before finally striking off Company, has to satisfy himself that sufficient provision has been made for the realization of all amounts due to the Company and for the payment or discharge of its liabilities and obligations by the Company within a reasonable time, and, if necessary, obtain necessary undertakings from the Managing Director, Director or other persons in charge of the management of the Company. Though the impugned striking off the Company was in accordance with law, the Tribunal has to take into consideration of bona fide contentions of Petitioner seeking to restore name of Company, by taking a lenient view of the issue in the interest of justice and ease of doing business, instead of rigidly interpreting the law on the issue. It is also not in dispute that the instant Company Petition is filed in accordance with law; there are no investigations pending against the Company; the Respondent has not opposed the Petition; and left the issue to Tribunal to consider the case subject terms and conditions.
It is true, while exercising jurisdiction of the Tribunal under the provisions of Companies Act, 2013, the Tribunal has to take into consideration the gravest economic condition prevailing in the Country due to pandemic conditions, while considering the issue especially in imposing costs.
The Registrar of Companies, Karnataka, the Respondent herein, is ordered to restore the name of the Company in the Register maintained by the Registrar of Companies, Karnataka as if its name had not been struck off from the rolls of the Register, with restoration of all consequential action taken by Registrar of Companies, which includes restoration of DINs of its Directors - Application allowed.
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2020 (12) TMI 1088
Restoration of name of the Petitioners Company - section 252(3) of the Companies Act, 2013 R/w Rule 87A of the NCLT Rules, 2016 - HELD THAT:- Tribunal has to take into consideration the bona fide contentions of Petitioner seeking to restore the name of Company, by taking a lenient view of the issue in the interest of justice and ease of doing business, instead of rigidly interpreting the law on the issue. It is also not in dispute that the instant Company Petition is filed in accordance with law; there are no investigations pending against the Company; the Respondent has not opposed the Petition; and left the issue to the Tribunal to consider the case subject to terms and conditions. The Company is a going concern and striking of its name would adversely affect the business as well as various stakeholders and employees. Its Directors have lent unsecured loan to the Company and the Company Bank account is seized which is affecting its business operations. No prejudice would be caused to any party if the Company's name is restored, as prayed.
The Shareholders of the Company have undertaken to file all the returns, statements and documents that are required under the Companies Act, 2013 within the prescribed time. Therefore, in the interest of justice would be met if the name of Company is restored as prayed for, however, subject to conditions mentioned below.
The Registrar of Companies, Karnataka, the Respondent herein, is ordered to restore the name of the Company in the Register maintained by the Registrar of Companies, Karnataka as if its name had not been struck off from the rolls of the Register, with restoration of all consequential action taken by Registrar of Companies, which includes restoration of DINs of its Directors - application allowed.
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2020 (12) TMI 1087
Exemption from GST - supply of, services viz. execution of the civil works of Pazhassi small hydro electric project - Whether Kerala State electricity Board Ltd would fall under any of the categories viz. Central Government, State Government, Union territory, a local authority, a Government authority or a Government entity for the purpose of the said exemption - whether the said services shall attract concessional rate of SGST also @6% in terms of notification No. SRO 370/2017 dated 30.06.2017 since the CGST statutory provisions are pari materia With State GST provisions? - HELD THAT:- Kerala State Electricity Board Ltd is a company incorporated under the Companies Act, 1956 by the Government of Kerala for carrying out the business of Generation, Transmission and Distribution of electricity in the State of Kerala. It is the successor entity of the Kerala State Electricity Board which was constituted by the Government of Kerala by Order no. EL1- 6475/56/PW dated 07.03.1957 under the Electricity (Supply) Act, 1948 for carrying out the business of Generation, Transmission and Distribution of electricity in the State of Kerala - It is evident that the Kerala State Electricity Board Ltd is incorporated under the Companies Act, 1956 with 90 per cent or more participation by way of equity or control of the Government of Kerala to carry out the business of generation, transmission and distribution of electricity in the State of Kerala and is a "State Transmission Utility" within the meaning of Section 2 (67) of the Electricity Act, 2003.
Kerala State Electricity Board Ltd cannot be considered as that constituted/established by the Government of Kerala to carry out any function entrusted to a Municipality under article 243W or a Panchayat under article 243G of the Constitution. Therefore, Kerala State Electricity Board Ltd does not fall under the definition of "Government Authority" as defined in Para 2(zf)of Notification No. 12/2017 Central Tax (Rate) dated 28.06.2017 as amended. However, Kerala State Electricity Board Ltd is also a Board constituted by the State Government with share of 90% or more of the State Government. Hence, Kerala State Electricity Board Ltd squarely falls under the definition of "Government Entity" under Para 2 (zfa) of Notification No. 12/2017 Central Tax (Rate) dated 28.06.2017 as amended. Thus the condition of the 'said notification as stated in para· 8.1 (b) of this order is also satisfied - The Kerala State Electricity Board Ltd is undisputedly procuring the services from the appellant in relation to a work entrusted to it by the State Government i.e. in connection with the generation, distribution and supply of electricity to consumers. KSEB Ltd is also a board constituted by the State Government with share of 90% or more of the State Government. Hence, Kerala State Electricity Board Ltd squarely falls under the definition of "Government Entity" under Para 2 (zfa) of Notification No. 12/2017 Central Tax (Rate) dated 28.06.2017 as amended. Hence, the mandatory condition specified in para 8.1(c) is satisfied.
Whether the supply of works contract services provided to KSEB by the appellant could be classified as works undertaken predominantly for use other than for commerce, industry or any other business or profession? - HELD THAT:- The concessional rate of CGST @6% under Sl. No.3 (vi) (a) of Notification No. 11/2017-Central Tax (Rate) dated 28.06.2017 is applicable only for composite supply of works contracts as defined in clause (119) of Section 2 of the GST Act, 2017 supplied by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of a civil structure or any other original works meant pre-dominantly for use other than for commerce, industry, or any other business or profession - The Kerala State Electricity Board as authorized by the Government vide the Electricity Act 2003 is involved in the selling of electricity to the consumers and are collecting charges for the same. The predominant activity of the KSEB is to supply electricity and works executed by the appellant is ancillary to this predominant activity.
Kerala State Electricity Board Ltd. has been established for carrying out the business of generation, transmission and distribution of electricity in the State of Kerala on commercial principles as is evident from the provisions of Sections 61 and 62 of the Electricity Act, 2003 regarding tariff regulation and determination of tariff - the supply of works contract services as per the above work order cannot be considered as that meant predominantly for use other than for commerce, industry, or any other business or profession. Thereby, the condition mentioned in para 8.3 is not fulfilled.
The Kerala State Electricity Board Ltd falls under the category of a Government entity for the purpose of the said exemption - The supply of services viz. execution of the civil works of Pazhassi small hydro electric project covered under Work order No. 06/CEECCN/ 2017-18 dated 06.10.2017 made by the appellant to the Kerala State Electricity Board Ltd are not eligible to concessional rate of CGST @6%provided by the said notification No. 11/2017-Central Tax (Rate) dated 28.06.2017.
The said services shall not be eligible for concessional rate of SGST @6% also in terms of notification No. SRO 370/2017 dated 30.06.2017 since the CGST statutory provisions are pari materia with State GST provisions.
The ruling of authority upheld.
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2020 (12) TMI 1086
Validity of order u/s 144C - Failure to pass a draft assessment order under Section 144C(1) - Non adhere to the mandatory procedure prescribed under Section 144C - HELD THAT:- This issue is no longer res integra. It is now settled law that failure to adhere to the mandatory procedure prescribed under Section 144C of the Act would vitiate the entire proceedings and the same cannot be treated as an irregularity/ curable defect.
In the present case, in complete contravention of Section 144C, the Assessing Officer wrongfully assumed the jurisdiction and passed the final assessment order without passing a draft assessment order and without giving the respondent/assessee an opportunity to raise objections before the Dispute Resolution Panel. See ESPN Star Sports Mauritius S.N.C. ET Companies [2016 (4) TMI 45 - DELHI HIGH COURT] wherein held as held that failure to pass a draft assessment order under Section 144C(1) of the Act would render the final assessment order without jurisdiction, null and void and unenforceable.
This Court is of the opinion that no question of law, let alone a substantial question of law, arises in the present appeal.
This Court is of the view that till the Income Tax Department ensures that the Assessing Officers follow the mandate of law, in particular, binding provisions like Section 144C and eschew filing of unnecessary appeals rather than in nearly all matters where the Assessing Officer has taken a view against the Assessee, the assessments will not achieve finality for a number of years like in the present case where the case of assessment year 2007-08 stands remanded and restored to the file of the Assessing Officer.
Revenue appeal dismissed with cost.
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2020 (12) TMI 1085
Rectification petition u/s 254 - period of limitation - HELD THAT:- Address of the appellant mentioned in the appeal before the ITAT by the respondent/Department was its former address and not the new address, which had been mentioned in the appeal filed by the petitioner before the Commissioner, Income Tax (Appellate) in form No. 35.
Consequently, the petitioner was never served in the appeal filed by the Department before the ITAT.
This Court is also of the view that the ITAT has erroneously concluded that the miscellaneous application filed by the petitioner was barred by limitation under Section 254(2) of the Act inasmuch as the petitioner had filed the miscellaneous application within six months of actual receipt of the order. If the petitioner/assessee had no notice and no knowledge of the order passed by the ITAT, it cannot be said that the limitation would start from the date the order was pronounced by the Tribunal.
Issue raised in the present petition is squarely covered in favour of the petitioner/assessee by way of the Division Bench judgment of this Court in ‘Golden Times Services Pvt. Ltd. Vs. DCIT’ [2020 (1) TMI 971 - DELHI HIGH COURT].
Course adopted by the ITAT at the first instance, by dismissing the appeal for non-prosecution, and then compounding the same by refusing to entertain the application for recall of the order, cannot be sustained. We, therefore have no hesitation in quashing the impugned order. Accordingly, the present petition is allowed.
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2020 (12) TMI 1084
Certificate under Section 197 denied - refusing to grant a certificate of deduction of tax at source at NIL rate, on payments to the petitioner company by its customers - HELD THAT:- Rule shows that the considerations and parameters prescribed under clause (2) are mandatory and the department is bound to take the same into consideration for the purpose of computation of existing and estimated liability referred in sub-rule (1).
As perused the impugned reasons furnished by the Revenue in support of the impugned Lower Tax Deduction Certificate and note that as opposed to estimation of tax liability, the assessing officer has instead rejected the estimates provided by the assessee, on a broad and generalized reasoning. Thus, in absence of determination, as provided under the above-noted Rule, the reasons for rejections cannot be termed as valid in eyes of law. Consequently, decision making process in the present case is contrary to law.
This court finds that there is non-application of mind which vitiates the impugned order and reasons. Accordingly, we set aside the impugned order and reasons and remand the matter to the Assessing Officer for fresh determination in accordance with law as expeditiously as possible preferably within three weeks.
In the interim, we direct that the benefit of revised TDS rates prescribed for financial year 2019-2020 (determined vide order dated 26th July, 2019) read with rebate of 25% given by Ministry of Finance on account of Covid-19 crisis from the rates applicable in the preceding year 2019-20 vide Press Release dated 13th May, 2020 be given to the petitioner.
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2020 (12) TMI 1083
Rectification application u/s 254 - Admissibility and consider the additional evidence furnished by the appellant under Rule 29 of the ITAT Rules - HELD THAT:- This Court would not entertain an appeal under Section 260A of the Act if an application for rectification under Section 254(2) of the Act is pending consideration as there is some overlap and if the order is recalled by the Tribunal, then the initial appeal would become infructuous. But in the present case, as the last date for availing the benefit of amnesty scheme being ‘Vivad se Vishwas Scheme’ is 31st December, 2020 and despite all efforts, the Tribunal is not deciding the application for rectification under Section 254(2) of the Act and learned counsel for respondent has stoutly opposed passing of any order in the present appeal to expedite disposal of the application filed by the appellant under section 254(2) before the Tribunal, this Court is of the opinion that if the present appeal is not entertained, it would gravely prejudice the appellant.
As far as the argument that the appellant’s application under Rule 29 of ITAT Rules is liable to be dismissed as the conditions mentioned therein are not attracted, this Court is of the view that it cannot second guess what order the Tribunal would pass as it is not for this Court but for the Tribunal to decide the said application. In fact, it has been so held by the Supreme Court in the case of Jyotsna Suri [1998 (10) TMI 552 - SC ORDER]
This Court is not impressed by the submission of learned standing counsel for the respondent that the additional evidence filed by the appellant had in all probability been considered by the Tribunal. In the impugned order passed by the Tribunal, there is no reference to either the additional documents placed on record by the appellant or to the written submissions/synopsis filed by the appellant. To hold that the additional evidence filed by the appellant had been considered by the Tribunal would be to presume and assume certain facts which are not apparent from the record.
This Court is further of the opinion that as the appellant had admittedly filed an application for admission of additional evidence in terms of Rule 29 of the ITAT Rules prior to the date of final hearing, it was incumbent upon the Tribunal to consider the said application before proceeding ahead with the final hearing.
The present appeal is allowed and the order of the Tribunal dated 28th February, 2019 is set aside; the appeal of the appellant is restored to the file of the Tribunal for de novo hearing.
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2020 (12) TMI 1082
Penalty u/s 271(1)(c) - Debatable assessment - HELD THAT:- This Court is of the view that the ITAT was right in deleting the penalty levied under Section 271(1)(c) of the Act. It has to be noted that penalty proceedings are an outcome of assessment and if the assessment itself is debatable, the penalty proceedings cannot survive.
Levy of penalty cannot be a matter of course, as sought to be contended by the Revenue. It can only be levied in cases where the concealment of income has been proven. If the quantum order itself has been challenged and this Court has framed substantial questions of law in the appeal preferred by the respondent-assessee, it shows that the alleged concealment is not final and the issue is disputable. Consequently, the penalty levied by the assessing officer cannot survive in such a case.
This Court in CIT Vs. Liquid Investment Ltd [2010 (10) TMI 1021 - DELHI HIGH COURT] has upheld the deletion of the penalty on the same ground i.e. the fact that appeals were admitted proved that the issue was debatable - No question of law.
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2020 (12) TMI 1081
Computation of capital gain - Cost of acquisition- diversion of the sale proceeds towards redeeming the interest of the mortgagor - whether no part of the consideration for sale was received by the appellant and same was directly paid to the Bank by the purchaser in discharge of the mortgage amount - claim that amount paid to bank towards clearing the cloud over the title should be deducted as provided u/s 48 as expenditure incurred wholly and exclusively in connection with such transfer - HELD THAT:- Issue decided in TMT. D. ZEENATH [2019 (4) TMI 817 - MADRAS HIGH COURT] mortgage deed was never registered and State Bank of India, Pondicherry did not have a right to bring the property to sale. The assessee in the present case, continued to have title over the property along with her co-owners. They brought the property to sale through Bank - there was no diversion of sale proceeds by virtue of overriding title, but on the contrary, there was only a mere application by the owners themselves of the profits realized on the sale of land towards the discharge of loan obligations of same firm. We also hold that the assessee cannot claim any part of such application as cost of acquisition for the purpose of computing capital gains as per the provisions of Section 48. - Decided in favour of revenue.
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2020 (12) TMI 1080
Refund of excess tax paid - petitioner submitted that the Assessing Officer could not have adjusted the refund claims of the petitioner against future assessments - HELD THAT:- The Assessing Officer committed a serious error in providing for adjustment of the excess tax against the demands for the later years. We may recall, while framing fresh assessments, the Assessing Officer found that the petitioner had paid certain excess tax in two of the four years concerned. In the other two years, where the tax was payable he raised a demand and we are told that such tax was also paid by the petitioner. For the years 2009-2010 and 2010-11, therefore, where the petitioner had admittedly suffered excess tax deduction at source as compared to his tax liability and thereafter deposited further amounts by way of pre-deposit for maintaining his revision petitions, he was entitled to refund thereof. Under sub-section (1) of Section 43 of Tripura Value Added Tax Act 2004, the Commissioner would refund to a dealer the amount of tax, penalty or interest, if any, paid by such dealer in excess of the amount due from him. Section 45 provides for payment of interest if the refund is not made within the time prescribed. Sub Section (1) of Section 46 provides that where an order giving rise to refund is subject matter of an appeal or further proceeding or where any other proceeding under the Act is pending and the Commissioner is of the opinion that grant of such refund is likely to adversely affect the revenue and it may not be possible to recover the amount later, the Commissioner may withhold the refund till such time as he may determine.
It is true that the TVAT Rules provide for a mechanism for grant of refund. In particular, Rule 35 requires the registered dealer to file a refund application before the concerned authority in prescribed manner. sub-rule (4) of Rule 35 prescribes a time limit for making such an application for refund. However, in the present case, the Assessing Officer himself while framing fresh assessments had declared that the petitioner shall not be granted refund but the excess tax collected would be adjusted against the future assessments. Till this order was set aside, therefore, the petitioner had no occasion to file refund claim. Any such refund application filed under Rule 35 of the TVAT Rules would have been summarily dismissed.
The portion of the order dated 16th December, 2015 passed by the Assessing Officer providing for adjustment of the excess tax to be adjusted for future assessment is set aside. However, if by virtue of the operation of the said order for any future liability such excess tax or any part thereof is already adjusted, the question of refund at this stage will not arise - The authority shall verify the petitioner’s claim that for future years, he had no further tax liability and refund such excess tax with statutory interest which may not have been adjusted against the future liability of the petitioner. This exercise shall be completed within 3(three) months from today.
Petition disposed off.
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2020 (12) TMI 1079
Reopening of assessment u/s 147 - Revision u/s 263 - Whether Department had not produced any record to show that there was a tangible material available to reopen the assessment and more so when all the 14 lease transactions were the subject matter of block assessment, which was set aside and thereafter, it was the subject matter of the directions issued by the CIT under Section 263? - material for the CIT to exercise his jurisdiction under the said provision to deny the assessee on the deduction as well as on the depreciation claim considered by the Assessing Officer in the assessments related to the relevant assessment years - HELD THAT:- Notices have been issued after getting the prior approval of the CIT. In fact, the CIT passed an order under Section 263 of the Act, which was quashed. Once over again, he granted approval for issuance of notice for reopening. The reasons for reopening were to examine the five transactions where the assessee claimed 100% depreciation.
The respondents would state that the Investigation Wing of the Department made certain inquiries and investigation to verify the genuineness of the transactions relating to purchase and lease back of the machineries from the above stated parties and the corresponding claim of depreciation in respect of those assets could not be accepted.
Thus, the five transactions, which have been referred to as the reasons for reopening the assessment, were, indeed, the very same transactions, which formed part of the 14 transactions, which were considered in the block assessment as well as in the proceedings under Section 263 of the Act.
As perused the return of income filed by the assessee for the relevant assessment years, in which, the claim for depreciation had been disclosed. Therefore, it is clear that the assessee disclosed all material information to the Assessing Officer.
There is no allegation made by the Department against the assessee that they failed to truly and fully disclose all relevant material. Thus, without any such allegation against the assessee, the Department would not be justified in reopening the assessment by exercising its power by issuing notices under Section 148 of the Act.
Identical circumstances were the subject matter of the decision in the case of Smt.Mira Ananta Naik [2008 (8) TMI 800 - BOMBAY HIGH COURT] wherein it was held that it was not in dispute that the block assessment was carried out and the block assessment was the subject matter of the proceedings and that notices merely stating that there was reason to believe that income chargeable to tax for the relevant assessment year escaped assessment without anything more could not be stated to be something, which would enable the Authorities to invoke Section 147 of the Act.
We find that the assessee disclosed all relevant facts and the Assessing Officer considered them and after the search, which was conducted on 08.7.1996, the block assessment was framed, which was ultimately set aside. Parallelly, the regular scrutiny assessments were done under Section 143(3) of the Act and thereafter the CIT exercised his power under Section 263 of the Act and passed an order, which was also set aside.
Material, which was already placed on record, and considered in earlier two rounds of litigation can hardly be a reason to reopen the assessment and all that we can say is that the attempt of the Department is to reopen a settled issue solely based upon change of opinion. The Department is silent and has not disclosed as to what is the tangible material, which is now available with them more than those that were available with the Department in the earlier two rounds of litigation. Therefore, we can safely hold that what the Department seeks to do is not to reopen the assessment, but to review the earlier orders, which had attained finality. That apart, the tax case appeals filed by the assessee having been allowed by judgment dated 03.12.2013, the decision is binding upon the Department and the same reasons, for which, the CIT exercised his power under Section 263 of the Act, cannot be used for issuing the notices for reopening.
Decision of the Tribunal has to be read as a whole and the Department cannot pick and choose a few sentences and observations made by the Tribunal, which are not relatable to the assessee's case, but probably an opinion regarding the statutory provision. The Tribunal recorded a finding that the transactions were not fraudulent, that the assessee disclosed all the transactions and that all the transactions were through banking channels.
Unless there is a fresh tangible material available with the Department, the question of reopening the assessments based on the material already available on record is impermissible. As pointed in the decision of the Hon'ble Supreme Court in the case of Kelvinator of India Ltd. [2010 (1) TMI 11 - SUPREME COURT] what is to be borne in mind is the conceptual difference between the power of review and the power to re-assess, that the Assessing Officer has no power to review, but he has a power to reassess, that the reassessment should be based on fulfillment of certain preconditions and that if the concept of change of opinion is removed, then in the garb of reopening the assessment, review would take place. This is precisely what the Department seeks to do in the cases on hand.
No hesitation to hold that the reopening of assessment is without jurisdiction, bad in law and liable to be set aside and consequently, the same is set aside.
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2020 (12) TMI 1078
Income from other sources as per Section 56(2)(vii) - whether the fair market value of bonus shares computed as per Rule 11U and Rule 11UA of the Income Tax Rules can be considered as income from other sources as per Section 56(2)(vii) ? - HELD THAT:- The issue of bonus shares by capitalization of reserves is merely a reallocation of the companies funds. There is no inflow of fresh funds or increase in the capital employed, which remains the same. The total funds available with the company remains the same and issue of bonus shares does not result in any change in respect of capital structure of the company.
Thus, there is no addition or alteration to the profit making apparatus and the total funds available with the company remain the same. In substance, when a shareholder gets a bonus shares, the value of the original share held by him goes down and the market value as well as intrinsic value of two shares put together will be the same or nearly the same as per the value of original share before the issue of bonus shares.
Thus, any profit derived by the assessee on account of receipt of bonus shares is adjusted by depreciation in the value of equity shares held by him. In the instant case, there is no material on record to infer that bonus shares have been transferred with an intention to evade tax, which is the object of the provision in question.
Commissioner of Income Tax (Appeals) as well as the tribunal have rightly held that when there is an issue of bonus shares, the money remains with the company and nothing comes to the shareholders as there is no transfer of the property and the provisions of Section under Section 56(2)(vii)(c) of the Act are not attracted to the fact situation of the case. - Decided in against revenue.
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2020 (12) TMI 1077
Dishonor of Cheque - insufficiency of funds - Sections 138 read with 142 of the Negotiable Instruments Act, 1881 - vicarious liability on the part of the accused - legally enforceable debt or not - HELD THAT:- It is not in dispute that the petitioner/A3 was a Director of A1 company and in the complaint lodged by the respondent except mentioning the magical word that the accused are incharge of the management and affairs of the company, there is nothing more.
This Court finds that there is no factual averments to show how the petitioner is responsible for the business and conduct of A1 company to invoke provision under Section 141 of the Negotiable Instruments Act - Further, the petitioner/A3 is no more Director of the A1 company on the date of cheque i.e., on 07.09.2012, since she resigned from the company on 10.10.2011. In support of the contention, the petitioner produced Form 32 to that effect, which is at page No.6 of the typed set. The petitioner is a lady.
Petition allowed.
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2020 (12) TMI 1076
Dishonor of Cheque - It is contended by the petitioner's counsel that as per section 148 of the Negotiable Instruments Act, which came into force on 01.09.2018, by virtue of the Amendment Act 20 of 2018, the appellate court is competent to direct the petitioner only to deposit such sum which shall be a minimum of 20% of the fine or compensation awarded by the trial court - section 148 of the Negotiable Instruments Act - HELD THAT:- On a reading of section 148 of the Negotiable Instruments Act, it is evident that pending appeal, the appellate court is competent to direct the appellant/accused to deposit such sum which shall be a minimum of 20% of the fine or compensation awarded by the trial court. In such view of the matter, the impugned order passed by the Court below directing the petitioner/accused to deposit 20% of the cheque amount is found to be erroneous and liable to be setaside, particularly when the petitioner/accused has been directed by the trial court to pay only a fine of ₹ 10,000/- alone and also to undergo simple imprisonment for one year.
The impugned order is set aside - Petition disposed off.
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2020 (12) TMI 1075
Dishonor of Cheque - insufficiency of funds - Petitioner borrowed the money from the advocate - only point raised by the learned counsel appearing for the petitioner is that the respondent is being an Advocate, he ought not to have do the business of money lending - Section 138 of Negotiable Instruments Act - HELD THAT:- Hon'ble Supreme Court of India in V.C. RANGADURAI VERSUS D. GOPALAN AND ORS [1978 (10) TMI 155 - SUPREME COURT] held that the action of Advocate is against public policy and an act of professional misconduct. The proceedings under his complaint is felt to be abuse of process of law and have to be quashed. In the case on hand, when there is a specific bar for doing money lending business that too with his own client, the act of the respondent is amount to professional misconduct. Therefore, the entire proceedings initiated as against the petitioner is nothing but clear abuse of process of law and the complaint itself is liable to be quashed.
Petition allowed.
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2020 (12) TMI 1074
Dishonor of cheque - Section 138 of Negotiable Instruments Act - case of petitioner is that the respondent and his brother cheated the petitioner to the tune of ₹ 7 lakhs and also misused the cheque issued by the petitioner herein and filed false case as against him with concocted stories - HELD THAT:- The proceedings under his complaint is felt to be abuse of process of law and have to be quashed. In the case on hand, when there is a specific bar for doing money lending business that too with his own client, the act of the respondent is amount to professional misconduct. Therefore, the entire proceedings initiated as against the petitioner is nothing but clear abuse of process of law and the complaint itself is liable to be quashed.
In the judgment of the Hon'ble Supreme Court of India in M/S BRIDGESTONE INDIA PVT. LTD. VERSUS INDERPAL SINGH [2015 (12) TMI 777 - SUPREME COURT] held that the place where the cheque is delivered for collection i.e., the branch of the payee or holder in due course, where the drawee maintains an account, would be determinative of the place of territorial jurisdiction. Accordingly, the respondent ought to have filed the complaint within the jurisdiction of Indian Bank, High Court branch. Therefore, on this ground also the complaint cannot be sustained as against the petitioner.
Petition allowed.
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