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Case Laws
Showing 341 to 360 of 1843 Records
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2017 (1) TMI 1505
Clearances of cases pending before Debt Recovery Tribunal - Held that: - Legislative changes to provide for expeditious disposal of proceedings before the Debt Recovery Tribunals may not by themselves achieve the intended object so long as the infrastructure provided to the Tribunals is not commensurate with the burden of the work and nature of judicial duties - Having due regard to the important adjudicatory function which is entrusted to these Tribunals, the efficacy of parliamentary legislation will depend in a large measure on the efficiency with which the Tribunals discharge their duties - Union Government directed to file affidavit on relevant issues.
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2017 (1) TMI 1504
Disposal of Criminal appeals - Setting up additional courts and providing additional infrastructure for ensuring access to justice and speedy disposal of cases - clearance of backlog of cases - short-term, ad-hoc appointments should be made from amongst retired judges for clearing the backlog - rate of disposal method - Held that: - Until NCMSC formulates a scientific method for determining the basis for computing the required judge strength of the district judiciary, the judge strength shall be computed for each state, in accordance with the interim approach indicated in the note submitted by the Chairperson, NCMSC - The High Courts shall take up the issue of creating additional infrastructure required for meeting the existing sanctioned strength of their state judiciaries and the enhanced strength in terms of the interim recommendation of NCMSC - List the proceedings for disposal of the criminal appeals before the appropriate bench in the third week of July 2017.
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2017 (1) TMI 1503
Penalties u/s 76, 77 and 78 - mandap keeper service - amenities furnished at the Mandap - Held that: - neither the Commissioner (Appeals) nor the CESTAT record a finding to the effect that there was suppression with the intent of evading tax. A bonafide omission will not lead to a conclusion of suppression under Section 78 of the Act. It is a settled proposition that intention of the assessee to suppress must be established in the absence of which no penalty will lie under under Section 78 of the Act - penalty not levied - appeal allowed - decided in favor of appellant.
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2017 (1) TMI 1502
Addition u/s 36(1)(iii) - Held that:- On perusing the provisions of Section 36(1)(iii) found any expenditure in nature of interest on borrowed capital shall be allowed as deduction provided it has been utilized for the purpose of business. We are of the opinion that the assessee could not satisfy with the correct allocation of interest and interest advance information and the Assessing Officer order also does not satisfy with the reasons except relying on the contention of the assessee. The Ld. TPO has also made adjustment as advance was provided to subsidiary company and these aspects are to be verified from the angle of commercial expediency, which the Assessing Officer has not made any enquiry or called for any documents from subsidiaries to prove that there exist a commercial expediency. Therefore, we are of the opinion, one more opportunity to be provided to the assessee to explain the commercial expediency of this transactions with the subsidiary company before the Assessing Officer and we remit the dispute of issue of interest disallowance made by the Assessing Officer on M/s. Prodapt Corporation Inc, USA, M/s. Prodapt Technology Holdings Pvt Ltd and M/s. Southern Group Industries Pvt. Ltd to the file of the Assessing Officer to verify and pass orders and the assessee should be provided opportunity of being heard before disposal of the order on merits.
Non deduction of TDS - payment to the subsidiary company towards software development services - Held that:- Considering the facts and the payment made to subsidiary for software development services does not come into the purview of applicability of provisions of TDS Section 40(a)(ia) of the act and accordingly we following the decision of this coordinate Tribunal M/s. Financial Software & Systems (P) [2016 (6) TMI 889 - ITAT CHENNAI] direct the Assessing Officer to delete the addition and allow this ground of the assessee.
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2017 (1) TMI 1501
Notice issued u/s 158BC - file the return ‘within 15 days’ does not violate the provisions of Section 158BC which requires to issue a notice providing time of ‘not being less than 15 days’ which implies clear 15 days - Held that:- Fifteen days means, clear fifteen days which is the requirement under law. In that view of the matter, we are of the view that the notice which was issued by the authority asking the assessee to file the return within fifteen days is not in accordance with the provisions of the Income-tax Act and therefore it is invalid. In our view, the authority who is issuing the notice must be aware of the Act and must construe the provision strictly. The words 'not less than fifteen days’ have to be interpreted correctly.
In that view of the matter, since the Assessing Officer asked the assessee to file the return within fifteen days of the service of the notice, the notice issued by the Assessing Officer is invalid. We are, therefore, of the opinion that the Tribunal has rightly cancelled the order of the AO. See Surya Dev Kumawat vs. CIT [2016 (11) TMI 1385 - RAJASTHAN HIGH COURT]. The questions referred to us are, therefore, answered in favour of the assessee and against the revenue.
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2017 (1) TMI 1500
Judgment of Acquittal - case of appellant is that the trial Court had committed an error in acquitting the Respondent/Accused, by not taking into a very vital fact that the Respondent had borrowed a sum of ₹ 3,00,000/- from the Appellant/Complainant towards his urgent family expenses and to discharge the said amount, the latter issued a cheque on the same day - Appellant urges before this Court that the 'onus' is on the Respondent/Accused to prove that Ex.P1 Cheque dated 02.05.2015 was not legally enforceable one.
Held that: - It is well settled in Law that when an individual had paid an amount payable by him, he ought to have been discharged his obligation and a creditor is bound to accept the tender. In fact, under Section 138 of the Negotiable Instruments Act, a Court of Law is to presume that a cheque was issued towards a debt or liability and in reality, the said presumption is a rebuttable one, the onus of proving that the cheque was not issued for a debt or liability is on an Accused. A Drawer has to establish the same in the course of trial of a main case by adducing a cogent, coherent and convincing evidence.
One cannot brush aside a very significant fact that it is not for the prosecution to eliminate and anticipate all possible defence circumstances which may exonerate an accused - It is true that an Appellate Court is not meant to fill up the gaps/lacunae in a prosecution case. However, when it is the duty of a concerned Court of Law to ascertain the factual aspect/truth in a given case, then, an Appellate Court can re-appreciate the evidence available on record and to come to its independent conclusion.
Maintainability of Appeal - Held that: - Just because a Leave was granted it does not fetter the Court when real facts were brought before it from going into the issue whether an Appeal is maintainable.
Where an acquittal in Appeal was recorded by the Sessions Judge, an application for Leave to have under sub-section (4) of Section 378 Cr.P.C. by the Complainant is maintainable. In fact, Section 378(4) Cr.P.C. applies as much to cases instituted upon complaints for the offences under I.P.C. as it does to complaints involving any other offence under any special enactment - Section 378(4) Cr.P.C. places no restriction on the complainant.
Section 4(2) Cr.P.C. enjoins that all offences under any other Law, other than I.P.C. shall also be enquired into or tried and otherwise dealt with the provisions of the Code, subject to any other enactment which contemplates a different mode of trial for such offence. Furthermore, the non-obstante clause in Section 142 of the Negotiable Instruments Act clearly spell out that the three matters mentioned in Section have an overriding effect on the ingredients of Criminal Procedure Code. Apart from that, in an exercise of an Appellate Jurisdiction, the Court has power not only to correct an error in the Judgment under Appeal but to make such disposition of the case, of course according to equity, good conscience, fair play and Justice.
This Court is of the considered opinion that an opportunity is to be provided to the Appellant/Complainant to examine Palanisamy on his side to repel/repudiate the stand of the Respondent/Accused. Also that, when it is a case of the Appellant/Complainant that at the time of loan amount being paid to the Respondent/Accused, his wife was present, then, this Court is of the cocksure view that the Appellant/ Complainant is to examine his wife to speak about the transaction in issue (especially when it was disputed on the side of Respondent/ Accused).
The entire subject matter in issue is remanded back to the Learned Judicial Magistrate, Fast Track Court (Magisterial Level), Attur for fresh consideration in the manner known to Law and in accordance with Law.
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2017 (1) TMI 1499
No opportunity provided by AO before completing the assessment u/s 144 - Held that:- No substantial question of law has arisen in this matter. Besides the discussion made above, learned counsel for the appellant has also failed to point out any perversity, legal or otherwise in the judgments of Courts below, so as to warrant interference by this Court. It is not shown that any admissible and relevant evidence was ignored or any inadmissible evidence was taken into consideration or there is any other perversity, legal or otherwise, in the judgment under appeal.
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2017 (1) TMI 1498
Validity of reopening u/s 147 - change of opinion - Held that:- Details of Shareholders and complete details of increase in share capital including name of shareholder, Address, PAN and confirmation. The assessee, in reply, provided the details of shareholders, PAN, Address, Share Application form, Confirmation from respective applicants along with their Board resolutions, Return of allotment, Board resolution of the assessee company regarding Share Allotment etc.
After appreciating the same, the assessing officer concluded the assessment. Above facts show that the assessee has disclosed all material facts at relevant places during original assessment proceedings u/s 143(3) of the Act. The AO himself asked for specific questions and full details were supplied by the assessee. AO examined these documents and framed the assessment only after proper application of mind. There was no failure on the part of the assessee to fully and truly disclose all the material facts. Thus, reassessment is being sought by the AO on mere change of opinion and apparently on the basis of information received from the investigation wing but nevertheless, all the information was available before AO during original proceedings. - Decided in favour of assessee.
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2017 (1) TMI 1497
Right to further cross-examine PW-9 confining questions with regard to the nature of weapon used - Held that:- The conclusion given by the Court below is not correct as it is the cross-examination which forms the evidence and on the basis of evidence available on record; it is to be determined whether the petitioner has committed the offence or not.
Resultantly, the impugned order dated 3rd November, 2016 is hereby set aside and the petitioner is given right to further cross-examine PW-9 who shall be confining his questions with regard to the nature of weapon used.
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2017 (1) TMI 1496
Reopening of assessment - A.O. come to a conclusion based on such AIR information that cash deposits have been made in his bank account, that income assessable to tax had escaped assessment - Held that:- There is no nexus or live link between the material which had come to the notice of the Assessing officer, and the formation of his belief that there was escapement of income by the assessee which may be assessable to tax. Merely by mentioning the income of the assessee in the assessment year, and the investment made by him for the purchase of residential property, it cannot be concluded that the difference would automatically be the income which had escaped assessment. See Pravin Kumar Jain vs. ITO [2016 (3) TMI 90 - ITAT DELHI] - Decided in favour of assessee
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2017 (1) TMI 1495
Nature of expenditure - revenue or capital - Held that:- As decided in CIT, Jaipur vs. Rajasthan State Mines & Minerals Ltd. [2016 (9) TMI 1394 - RAJASTHAN HIGH COURT] the relevant year debited entry in the books of account for the year 1992-93, therefore, resolution is passed subsequently but since it was mercantile system for the year 1992-93, it will come into force. The contention which has been raised by Mr. Singhi is required to be accepted, it can only be one time revenue expenditure and subsequent claim of the assessee will not be acceptable and if his claim is made and accepted, it will be for the department to recover the tax from the assessee.
In that view of the matter, the issue is answered in favour of the assessee and against the Department for the revenue expenses (Rs.2,96,000/-) of year 1992-93 only one time. The issue is answered in favour of the assessee and against the Department.
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2017 (1) TMI 1494
Monetary amount of appeal - maintainability of appeal - Held that: - Appeal pertains to duty demand of ₹ 7,42,297/-. We do not consider it productive in this appeal to invest time by the Tribunal while there is huge pendency involving crores of rupees of Revenue - appeal dismissed.
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2017 (1) TMI 1493
Block assessment - Notice under Section 158 BC - Addition on account of loose soap bricks found unrecorded during the course of search - Held that:- This is evident not only from the comparative sales prices between the component mix of the two. In so far as the report of Rajasthan Consultancy Organisation Ltd. Is concerned, we find that the organisation is sponsored by several Financial Institutions/Banks and all are public sector undertakings. Thus, this report is more credible/reliable. Moreover, the report is based on inspection of assessee’s place and actual physical verification of process and production. We do not accept the contention of the Id. D/R that this report should not be believed. However, considering the facts and said report, we hold that it would be fair and reasonable if the weight gain is adopted at 7.5% in the case of appellant. The AO has prepared the calculation of undisclosed income of assessment order in a table taking the weight gain at 15%. We hereby direct the AO to recalculate the undisclosed income by adopting 7.5% in place of 15% in the said table. See Commissioner of Income Tax, Jaipur vs. Smt. Radha Bajaj [2016 (9) TMI 1390 - RAJASTHAN HIGH COURT] - Decided in favour of the assessee
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2017 (1) TMI 1492
Promulgation of an Ordinance before the Legislative Assembly of the State Legislature - Mandatory under Article 213(2) of the Constitution Or Not - enduring or irreversible rights in a citizen - legality of re-promulgation of an Ordinance - concept of disapproval of an Ordinance by a Resolution as mentioned in Article 213(2)(a) of the Constitution - Expression "disapproval" - adequate checks and balances against a possible misuse of power by the Executive - Whether after an Ordinance ceases to operate, do concluded actions and transactions under that Ordinance survive - distinction between a temporary Act and an Ordinance.
HELD That:- The two learned judges (Justice Sujata Manohar and Justice Wadhwa) agreed in coming to the conclusion that the ordinances which were issued after the first would amount to a fraud on constitutional power. They however differed in regard to the validity of the first ordinance. Justice Sujata Manohar held that all the ordinances formed a part of a chain of acts designed to nullify the scheme of Article 213. In this view, each of the ordinances took colour from one another, notwithstanding some departures in the scheme of the fourth and subsequent ordinances. The entire exercise was held to be a fraud on the power conferred by Article 213 since the executive had no intention of placing any of the ordinances before the legislature. Justice Wadhwa on the other hand took the view that the effect of the first ordinance was of an enduring nature and held that what the first ordinance ordained was accomplished and its effect was irreversible. In this view, the ordinance was like a temporary law which had accomplished its purpose. Justice Wadhwa held that once the property has vested in the state there had to be an express legislation taking away vested rights. The conferment of rights on the employees was held to be of an enduring character which could not be taken away merely because the ordinance, like a temporary statute ceased to operate.
We have already adduced reasons earlier for overruling the enduring rights theory based on the analogy of a temporary statute. Moreover as we have indicated, it would not be correct to assert that these enduring rights could be set at naught only by an act of the legislature enacted with retrospective effect. The basic infirmity is that none of the ordinances, including the first, was laid before the legislature. There was a fundamental breach of a mandatory constitutional requirement. All the ordinances formed a part of one composite scheme by which the Governor of Bihar promulgated and re-promulgated ordinances. That chain or link commenced from the promulgation of the first ordinance. Hence, in the very nature of things it would not be possible to segregate the first ordinance since it forms an intrinsic part of a chain or link of ordinances each of which and which together constitute a fraud on constitutional power.
Conclusion-
In summation, the conclusions in this Judgment are as follows :
(i) The power which has been conferred upon the President under Article 123 and the Governor under Article 213 is legislative in character. The power is conditional in nature: it can be exercised only when the legislature is not in session and subject to the satisfaction of the President or, as the case may be, of the Governor that circumstances exist which render it necessary to take immediate action;
(ii) An Ordinance which is promulgated under Article 123 or Article 213 has the same force and effect as a law enacted by the legislature but it must (i) be laid before the legislature; and (ii) it will cease to operate six weeks after the legislature has reassembled or, even earlier if a resolution disapproving it is passed. Moreover, an Ordinance may also be withdrawn;
(iii) The constitutional fiction, attributing to an Ordinance the same force and effect as a law enacted by the legislature comes into being if the Ordinance has been validly promulgated and complies with the requirements of Articles 123 and 213;
(iv) The Ordinance making power does not constitute the President or the Governor into a parallel source of law making or an independent legislative authority;
(v) Consistent with the principle of legislative supremacy, the power to promulgate ordinances is subject to legislative control. The President or, as the case may be, the Governor acts on the aid and advice of the Council of Ministers which owes collective responsibility to the legislature;
(vi) The requirement of laying an Ordinance before Parliament or the state legislature is a mandatory constitutional obligation cast upon the government. Laying of the ordinance before the legislature is mandatory because the legislature has to determine: (a) The need for, validity of and expediency to promulgate an ordinance; (b) Whether the Ordinance ought to be approved or disapproved; (c) Whether an Act incorporating the provisions of the ordinance should be enacted (with or without amendments);
(vii) The failure to comply with the requirement of laying an ordinance before the legislature is a serious constitutional infraction and abuse of the constitutional process;
(viii) Re-promulgation of ordinances is a fraud on the Constitution and a sub-version of democratic legislative processes, as laid down in the judgment of the Constitution Bench in D C Wadhwa;
(ix) Article 213(2)(a) provides that an ordinance promulgated under that article shall “cease to operate” six weeks after the reassembling of the legislature or even earlier, if a resolution disapproving it is passed in the legislature. The Constitution has used different expressions such as “repeal” (Articles 252, 254, 357, 372 and 395); “void” (Articles 13, 245, 255 and 276); “cease to have effect” (Articles 358 and 372); and ”cease to operate” (Articles 123, 213 and 352). Each of these expressions has a distinct connotation. The expression “cease to operate” in Articles 123 and 213 does not mean that upon the expiry of a period of six weeks of the reassembling of the legislature or upon a resolution of disapproval being passed, the ordinance is rendered void ab initio. Both Articles 123 and 213 contain a distinct provision setting out the circumstances in which an ordinance shall be void. An ordinance is void in a situation where it makes a provision which Parliament would not be competent to enact (Article 123(3)) or which makes a provision which would not be a valid if enacted in an act of the legislature of the state assented to by the Governor (Article 213(3)). The framers having used the expressions “cease to operate” and “void” separately in the same provision, they cannot convey the same meaning;
(x) The theory of enduring rights which has been laid down in the judgment in Bhupendra Kumar Bose and followed in T Venkata Reddy by the Constitution Bench is based on the analogy of a temporary enactment. There is a basic difference between an ordinance and a temporary enactment. These decisions of the Constitution Bench which have accepted the notion of enduring rights which will survive an ordinance which has ceased to operate do not lay down the correct position. The judgments are also no longer good law in view of the decision in S R Bommai;
(xi) No express provision has been made in Article 123 and Article 213 for saving of rights, privileges, obligations and liabilities which have arisen under an ordinance which has ceased to operate. Such provisions are however specifically contained in other articles of the Constitution such as Articles 249(3), 250(2), 357(2), 358 and 359(1A). This is, however, not conclusive and the issue is essentially one of construction; of giving content to the ‘force and effect’ clause while prescribing legislative supremacy and the rule of law;
(xii) The question as to whether rights, privileges, obligations and liabilities would survive an Ordinance which has ceased to operate must be determined as a matter of construction. The appropriate test to be applied is the test of public interest and constitutional necessity. This would include the issue as to whether the consequences which have taken place under the Ordinance have assumed an irreversible character. In a suitable case, it would be open to the court to mould the relief; and
(xiii) The satisfaction of the President under Article 123 and of the Governor under Article 213 is not immune from judicial review particularly after the amendment brought about by the forty-fourth amendment to the Constitution by the deletion of clause 4 in both the articles. The test is whether the satisfaction is based on some relevant material. The court in the exercise of its power of judicial review will not determine the sufficiency or adequacy of the material. The court will scrutinise whether the satisfaction in a particular case constitutes a fraud on power or was actuated by an oblique motive. Judicial review in other words would enquire into whether there was no satisfaction at all.
We hold and declare that every one of the ordinances at issue commencing with Ordinance 32 of 1989 and ending with the last of the ordinances, Ordinance 2 of 1992 constituted a fraud on constitutional power. These ordinances which were never placed before the state legislature and were re-promulgated in violation of the binding judgment of this Court in D C Wadhwa [1986 (12) TMI 381 - SUPREME COURT] are bereft of any legal effects and consequences. The ordinances do not create any rights or confer the status of government employees. However, it would be necessary for us to mould the relief (which we do) by declaring that no recoveries shall be made from any of the employees of the salaries which have been paid during the tenure of the ordinances in pursuance of the directions contained in the judgment of the High Court.
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2017 (1) TMI 1491
TPA - comparable selection criteria - Held that:- Assessee is a captive service provider engaged in the business of rendering software development services to its Associated Enterprise ("AE") at cost plus 15% mark-up., thus companies functionally dissimilar with that of assessee need to be deselected from final list.
Foreign exchange fluctuations considered as non-operating in nature - Its foreign exchange gain should be considered as operating in nature - CIT (A) has, inter alia, directed the TPO to accept the assessee’s claim, on which, the Revenue is on appeal - Held that:- We have considered the rival contentions. This issue is remitted back to the TPO to examine whether the foreign exchange loss/gain is out of current years’s transactions or not. If that gain/loss arises out of current year’s transactions, then, it should be treated as operating in nature. To that extent Revenue’s claim is allowed.
Restricted the working Capital adjustment to 1.98% - Held that:- As this Tribunal in Moong Controls India P Ltd [2015 (11) TMI 1719 - ITAT BANGALORE] wherein this Tribunal directed the TPO to allow actual adjustment towards the differences in the of working capital position between the assessee and the entrepreneurial companies selected as comparable. We direct the TPO to follow this decision. To this extent, the assessee’s appeal ground is allowed.
Computation of deductions u/s 10A & 10AA - data communication, voice communication and cell phone expenses incurred in foreign currency should be excluded from the export turn over as well from total turnover on the basis of the Jurisdictional High Court decision in CIT v Tata Elxsi [2011 (8) TMI 782 - KARNATAKA HIGH COURT]. Thus the Revenue’s appeal grounds are dismissed.
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2017 (1) TMI 1490
TPA - comparable section criteria - Held that:- assessee was engaged in the business of providing software consultancy services in the field of Enterprise Resource Planning, Customer Relationship Management, Supply chain management, Business intelligence, Business integration, Human Resource Management, Infrastructure management services and strategic sourcing, thus companies functionally dissimilar with that of assessee need to be deselected from final list of comparable.
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2017 (1) TMI 1489
TPA - comparable selection criteria - Held that:- Assessee is engaged in the business of computer software development services, thus companies functionally dissimilar with that of assessee need to be deselected from final list.
Computation of deduction u/s 10A - Held that:- Action of the DRP in directing the AO to exclude data link charges and freight charges both from turnover as well as total turnover while computing deduction u/s 10A, we do not find any infirmity in the order of the DRP as it is in conformity with the ratio laid down by the Hon’ble Bombay High Court in case of CIT vs. Gem Plus Jewellery (2010 (6) TMI 65 - BOMBAY HIGH COURT) as held that communication charges attributable directly to the export of article or thing outside India has to be excluded both from export turnover as well as total turnover while computing exemption u/s 10A of the Act
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2017 (1) TMI 1488
Valuation - captive consumption - Certificate with respect to computation of the cost of production - whether certificate issued by Chartered Accountant with respect to computation of the cost of production, instead of being issued by Cost Accountant, is valid? - Held that: - as per the Board Circular No. 979/3/2014-CX dated 15.01.2014 the certificate issued by the Chartered Accountant is also a valid certificate - When the certificate issued by the Chartered Accountant is valid one, there is no reason to interfere with the impugned order passed by the Commissioner (Appeals) - appeal dismissed - decided against Revenue.
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2017 (1) TMI 1487
Conversion of shipping bills - free shipping bills into advance licence/DEPB/DFRC/Drawback shipping bills - Board’s Circular No. 6/2003-Cus., dated 28-1-2003 - Circular No. 40/2003-Cus., dated 12-5-2003 - Held that: - the appellant has not produced any documents, evidence in export of fulfilment of the above conditions for consideration of the case for conversion thereof - the application for conversion being filed after about three years, I do not find any reason to interfere with the order of the Commissioner of Customs - appeal dismissed - decided against appellant.
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2017 (1) TMI 1486
Natural justice - the appellant has been repeatedly seeking information from the Department that has not been coming forth - Held that: - The CESTAT has virtually granted a cart blanche to the appellant to produce all the materials required whatsoever and the Department has been directed to furnish adequate opportunity to the appellant prior to completion of the adjudication proceedings. This order of the CESTAT attained finality. The order of the CESTAT in the petition for rectification of mistake is on similar lines of earlier order. In the circumstances, we confirm the finding of the CESTAT in view of the direction given by the CESTAT to the Department that adequate opportunity has to be furnished to the appellant and the further direction to the appellant to furnish all the materials required to decide the necessary issue prior to completion of the adjudication - appeal dismissed - decided against appellant.
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