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Showing 341 to 360 of 1327 Records

• 2012 (11) TMI 994
  

  Input services - vastu consultancy - Denial of Cenvat credit of Service Tax in relation to civil construction work in the factory - setting up of labour hutments, kisan sheds is for providing temporary residential facility to the workers as also for the cane growers – Held that:- Vastu is in relation to the construction activity and as such, if construction activity has been held to be admissible services by the Commissioner, the vastu consultancy is also required to be held accordingly. As regards dismantling of building structure - before raising new construction for setting up of the factory, it is necessary to clear the place including dismantling of old structure stand thereon and such services are essentially included under the limb of setting up of a factory. As such, I find that the denial of credit by the adjudicating authority on the above services was not correct and proper.

  Extended period of limitation – Held that:- Credit so availed was part of the total credit availed by the assessee and was being duly reflected in the returns so filed. The appellant cannot be held guilty of suppression or mis-statement with an intent to evade payment of duty - a positive act with a mala fide intention is the requisite criteria for invocation of longer period of limitation. In the absence of the same, assessee cannot be held guilty of any malafide - entire demand having been raised after the normal period of limitation is time-barred.

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• 2012 (11) TMI 993
  

  Waiver of pre-deposit - applicant manufactured and cleared Pan Masala Gutka and had not paid duty as per the provisions of Pan Masala Packing Machines Rules, 2008 – Held that:- As per rule 6, the manufacturer has to file a declaration stating therein the number of packing machines - when the applicants filed the declaration stating therein that there is no packing machine for manufacture of Pan Masala Gutka and in absence of any verification to that extent - applicants have made out a strong case in their favour - pre-deposit of duty, interest and penalty waived

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• 2012 (11) TMI 992
  

  Interest on differential duty – Held that:- Appellant assessee is liable to discharge interest liability on the Central Excise duty paid by issuing supplementary invoices for the increased price of the final products cleared by them to their suppliers – against assessee

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• 2012 (11) TMI 991
  

  Whether the duty paid by the job worker on goods, received back by the appellant can be availed as Cenvat credit by the appellant – Held that:- Once the duty has been paid by job worker on goods sent back to appellant, there is no reason to deny benefit of Cenvat credit to the appellant – In favor of assessee

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• 2012 (11) TMI 990
  

  Registration u/s 12AA - Charitable purpose - Section 2(15) - advancement of any other object of general public utility - Held that:- If the assessee conducts marathon in a commercial manner, then the trust cannot be said to be existing only for charitable purposes in view of the amended definition of the charitable purpose w.e.f. 1.4.2008 - DIT(E) is directed to examine whether receipt of fees from marathon is incidental to charitable object of the assessee or it is the main activity of the assessee and decide thereupon. If the assessee falls under the purview of amended provision of section 2(15), then registration is not to be granted - In the result, appeal of assessee is allowed for statistical purposes.

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• 2012 (11) TMI 989
  

  Repairs and Maintenance of Residential flats and office buildings - 'capital expenditure' - held that:- most of the expenditure is incurred on the existing buildings or structures in the nature of repairs for maintenance of the asset as such, except the expenditure incurred on Mohandev Building, item No.8, 9 and 10 listed in the CIT (A)'s order. As seen from the details the amount of Rs. 11.00 lakhs and Rs. 4,85,970/- were incurred in connection with the sofa, recreation central table etc., which seems to be for creation of new assets and cannot be considered as repairs of the existing assets. Likewise the amount of Rs. 3.00 lakhs was spent on electrical fittings and Rs. 1.00 lakhs was spent for design consultancy and supervision charges. Therefore, in our view this expenditure is in the nature of capital expenditure and therefore, we uphold the disallowance to that extent. - AO directed to allow depreciation on capital expenditure - Decided partly in favor of assessee.

  Disallowance of amount spent on computer software - held that:- this matter should be referred to AO for fresh adjudication in the light of the decision of the Special Bench of the Tribunal in the case of Amway India Enterprises v DCIT, [2008 (2) TMI 454 - ITAT DELHI], as was done in earler years - issue is restored to the file of AO for fresh adjudication in accordance with the law and the principles governing this issue and after giving due opportunity of being heard to assessee.

  Unclaimed liabilities - accrual of liability or cessation of liability during the year - diference of opening and closing balance of unclaimed liability account - held that:- As and when the parties seek the amount which cannot be recognized as income, assessee is refunding the amount and once client does not seek any adjustment the same is accepted as income of the year after the end of three years limitation period as per assessee's own accounting method. - No reason for supporting the action of AO in bringing to tax the entire credit in the account as income of the year without examining the principles governing the method of accounting followed by assessee and accrual of income.

  Addition u/s 92CA(3) - selection of comparable - Payment was made for purchase of software for use in the business of advertising and media services. - Assessee claimed deduction u/s 37(1) for purchase of software and reported it as related international transactions. - held that:- determination of ALP at nil cannot be sustained. - assessee could not furnish necessary documents evidencing service - in the interest of justice we restore the issue to the file of TPO to examine the said payment for customized software afresh and determine the appropriate method for arriving at the ALP after giving due opportunity to assessee.

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• 2012 (11) TMI 988
  

  Determination of Arm's Length Price - Transaction with Associate Enterprises - In the present case Assessee has adopted "Transactional Net Margin Method" as most appropriate method for determining its ALP of international transaction. It had used six comparable companies for bench marking its ALP on international transactions. However, out of six, the TPO rejected three comparables on the ground that their related party transactions were either more than 15% or turnover was more than Rs. 1,500 crore - TPO introduced his set of fresh nine comparables to bench mark the ALP of international transaction of the assessee. The arithmetic mean of the PLI of the 12 comparable companies (three of assessee and nine of TPO) worked out to 5.34%.

  Held that:- Value of international transaction of the assessee falls within safe harbour of +/- 5% of the ALP determined by the TPO. Accordingly, on this preliminary ground alone, the adjustment of Rs. 3,70,87,177 made towards ALP by the Assessing Officer is uncalled for and the same is hereby deleted - grounds raised by assessee are allowed.

  The contention of the revenue that adjustment arising our of ALP has to be made on the entire turnover instead of restricting the same to the international transaction with the A.E - Decided in favor of assessee.

  Disallowance of Expenditure on Computer Software - held that:- insofar as the directions on account of AMC for maintenance of software given by the DRP is concerned, the same appears to be very reasonable and no interference is called for - However, with regard to the other expenditure, the Assessing Officer is directed to verify this contention of the assessee in the light of the decision of the Special Bench of the Tribunal, Delhi, rendered in Amway India Enterprises v. DCIT, [2008 (2) TMI 454 - ITAT DELHI]- Thus, this ground is partly allowed for statistical purposes.

  Disallowance of Depreciation on laptop purchased - held that:- Assessee could not produce evidence for purchase of laptop - no merit in the contention of the assessee and the same is dismissed - Thus, this ground is dismissed.

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• 2012 (11) TMI 987
  

  Interest accrued - method of accounting - assessee submitted that when the Tribunal had remanded the main issue, at this stage, question of charging interest would not arise – Held that:- Tribunal has merely remanded the proceedings to the Assessing Officer for fresh consideration on the question whether the assessee followed mercantile system of accounting or cash. In that view of the matter no question of law arises.

  Charge of interest u/s 234D - assessee submitted that when the Tribunal had remanded the main issue, at this stage, question of charging interest would not arise. - held that:- question would have no relation to system of accounting followed by Shiva Specific Family Trust - Assessing Officer would decide the issue in accordance with law on the basis of material on record

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• 2012 (11) TMI 986
  

  Reopening of assessment - Escapement of Income - Treatment of Entrance fees - Capital Receipt vs Revenue Receipt - held that:- The question of treating such entrance fees either as capital receipt or revenue receipt, was not part of query at the time of original assessment and therefore, the angle of taxability of such a receipt being a receipt of revenue in nature, cannot be stated to be a part of the query. Dispute is with respect to taxabilty of receipt of Rs. 5,56,000/- towards entrance fees as Capital receipt at the time of original assessment.

  In the present case When the notice has been issued by the Assessing Officer within a period of four years from the end of relevant assessment year, and when Assessing Officer had not formed any opinion in the original assessment with respect to taxability of the amount in question, such notice cannot be stated to be without jurisdiction or invalid - In the result, the petition fails and is dismissed. - Decided against the assessee.

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• 2012 (11) TMI 985
  

  Relinquishment of tenancy rights - whether deductible expenditure for computation of capital gains u/s 48 - held that:- Revenue Authorities and the Tribunal have held that the expenditure was not incurred wholly and exclusively in connection with the transfer of the capital assets. sale deed was not a tripartite agreement and the amount expended by the assessee separately would not fall within the expression wholly and exclusively incurred in connection with the transfer.

  Karta of the assessee HUF and his brother were the directors of the said Company. The said Company was shown to be the tenant of substantial portion of the building. The Company, however, created a sub-tenancy on the same property in favour of the Bank of Baroda.

  Payment of Rs.15,00,000/- made to the Company by the assessee was only for reducing its tax liability and not for the purpose of executing the transaction of sale.

  Sect 48(1) of the Act provides for mode of computation and deduction while charging capital gain. Clause-I thereof in particular provides for a payment from the value of consideration received or accrued as a result of transfer of capital asset, expenditure incurred wholly and exclusively in connection with such transfer. The expenditure cannot be stated to be incurred wholly and exclusively in connection with such transfer - no error in order of Tribunal - In the result, the question is answered in the negative - decided against the assessee.

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• 2012 (11) TMI 984
  

  Addition u/s. 68 of the Act – huge capital was introduced by two partners of the firm and as source of capital was not found satisfactorily explained - Held that:- no addition u/s. 68 of the Act can be made in case where the partner introduces capital in firm and he is assessed to tax separately. - Fund in such event had only to be taxed in the individual case of the partner concerned and not in the case of firm - when the partner who invested the fund since is already assessed to tax separately, in the case of the firm there would not be any necessity for explanation of the fund – In favor of assessee

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• 2012 (11) TMI 983
  

  Exemption u/s 11 - grant in aid received by assessee - held that:- the income in the form of voluntary contributions made with a specific direction that they shall form part of the corpus of the trust or institution is not to be included in the total income of the previous year of the person in receipt of the income - Decided in favor of asessee.

  Carry forward unabsorbed application u/s 11 and 13 - excess of expenditure over income - Held that:- Income derived from the trust property has to be determined on commercial principles and if commercial principles for determining the income are applied, it is but natural that the adjustment of the expenses incurred by the trust for charitable and religious purposes in the earlier year against income earned by the trust in the subsequent year will have to be regarded as application of income of the trust for charitable and religious purposes in the subsequent year in which such adjustment has been made having regard to the benevolent provisions contained in section 11 of the Act and will have to be excluded from the income of the trust under section 11(1)(1) of the Act – In favor of assessee

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• 2012 (11) TMI 982
  

  Deduction u/s.80IA – small scale industrial undertaking – Held that:- In the case of Prabhudas Kishoredas Tobacco Products Private Limited. (2006 (1) TMI 68 - GUJARAT HIGH COURT ) it was hold that the use of tobacco which was used in the input do not retain its identity once the beedies are rolled and in relation to the assessee's status as unit of small scale industrial undertaking, the Court decided the issue in assessee's favour by holding that while ascertaining the monetary limit laid down in the provision, all assets of business be not taken into consideration, upholding the version of the Tribunal treating the activity carried out by the assessee amounting to manufacture of beedi. - In favor of assessee

  Disallowance u/s.40A(2)(b) - Alleged that interest paid to the persons at the rate of 22% excessive and unreasonable – Held that:- Amount is borrowed in earlier years at a stipulated rate of interest and which is still utilized for the purpose of business, the interest rate could not have been renegotiated. Even the lending rate by banks in respect of secured loan is as high as 19.5%. Therefore, rate of interest, paid by the assessee is quite reasonable - Since the rate of interest paid by the assessee is reasonable disallowance deleted

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• 2012 (11) TMI 981
  

  Disallowance of loss on sale of shares - assessee could not produce the confirmations from M/s.R.K. Consultancy and even the Assessing Officer has required the assessee to produce the said broker for examination - Once the confirmation is not produced and even broker is not produced for examination in respect of transaction carried on by him, the transaction cannot be treated as genuine – matter remanded to AO

  Addition being amount advanced to Shri Sanjay – Held that:- Receipt of Rs.4 crores, which the assessee claimed he had received by way of an advance from one Shri Sanjay Amin - He, however, could not produce confirmation of said Shri Sanjay Amin as he had left the country - assessee could not produce the confirmation and other details regarding to said person and that therefore the claim was disallowed - further materials produced by the assessee - without proper verification such material ought not to have been accepted - issue was remanded to the Revenue authorities

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• 2012 (11) TMI 979
  

  Waiver of pre-deposit - valuation - inclusion of electricity charges - Renting of Immovable Property Service - held that:- Supply of Electricity is ‘goods' and the same shall not form part of taxable service as clarified by the Notification no. 12/2003 - applicant has made out a prima facie case for 100% waiver of the service tax confirmed and penalty imposed - Requirement of pre-deposit of the service tax, interest and penalty is waived and stay recovery thereof during the pendency of the appeal.

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• 2012 (11) TMI 978
  

  Deemed sale – Writ Petition - constitutional validity of section 2(24) of the Maharashtra Value Added Tax Act - challenge of the petitioners is that by Amending the provisions of section 2(24) the State Legislature has brought within the ambit and purview of the expression "sale", an agreement for the building and construction of immovable property which is not a works contract – Held that:- The effect of the amendment to section 2(24) is to clarify the legislative intent that a transfer of property in goods involved in the execution of works contract including agreement for building and construction of immovable property would fall within the description of a "sale of goods" within the meaning of the provision. - In order to meet the description contained in clause (b), State legislation must provide for a tax on the transfer of property in goods (whether as goods or in some other form) involved in the execution of a works contract. Such a transfer shall be deemed to be a sale by a person making the transfer and a purchase of those goods by the person to whom the transfer is made. The amendment made by the State Legislature does not transgress the limitations which have been imposed by article 366(29A)(b) of the Constitution.

  The amended definition of the expression "sale" in clause (b)(ii) of the Explanation to section 2(24) brings, within the ambit of that expression transactions of that nature which are referable to article 366(29A)(b). The transactions which the Legislature had in mind involve works contracts. What the State Legislatures can tax under the expanded definition contained in clause (b) of article 366(29A) must meet the governing requirements of that clause. There must be a transfer of property in goods involved in the execution of a works contract. The relevant clause in section 2(24) is valid because it does not transgress the boundaries set out in article 366(29A).

  Whether there is a works contract in a given case is for assessing authorities to determine. As noted earlier, it is not possible to provide a comprehensive or all-encompassing list of what contracts constitute works contracts. Section 2(24) properly construed, even after its amendment, reaches out to those cases which-fall within the ambit of article 366(29A). Explanation (b)(ii) to section 2(24) in other words covers those transactions where there is a transfer of property in goods, whether as goods or in any other form, involved in the execution of a works contract.

  Regarding validity of composition scheme - held that:- A composition scheme is made available at the option of the registered dealer. There is no compulsion or obligation upon a registered dealer to settle. The court may in an extreme instance interfere in the exercise of its powers of judicial review only where the terms of a composition scheme are ex facie arbitrary and extraneous so as to be violative of article 14. That has not been established before the court in this case. There is no merit in the challenge to the Constitutional validity of the composition scheme.

  The definition of the expression "works contract" in section "2(ja) of the Central Sales Tax Act, 1956, which has been introduced by Act 18 of 2005 with effect from May 13, 2005 is only for the purposes of that Act. The State law in the present case does not infringe the provisions of clauses (a) and (b) of article 286(3), for the aforesaid reason.

  Constitution validity of levy of levy of VAT on transfer of goods involved in execution of building and construction of immovable property upheld.

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• 2012 (11) TMI 977
  

  Amnesty Scheme - settlement of the liabilities under the KGST Act - Held that:- Benefit of the Amnesty Scheme was in fact extended to the petitioner and that on account of his failure to comply with the conditions of the Amnesty, offer of amnesty was revoked on 9/10/09. If the amnesty has already been extended and the same was revoked for the default committed in complying with its conditions, this Court now cannot direct consideration of Ext.P4 application made by the petitioner for the same relief. Therefore, consideration of Ext.P4 also cannot be ordered - Writ petition is dismissed.

  Petitioner submits that subsequently yet another application was made and the application is pending consideration of the authorities. It is clarified that this judgment will not stand in the way of the authorities in considering the application, if any, made by the petitioner in accordance with law, if they are otherwise eligible for the same.

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• 2012 (11) TMI 976
  

  Service tax demand - sponsorship service - applicants entered with an agreement with Board of Control for Cricket in India for organising the IPL tournament wherein the applicants are the sponsors for Umpire under a 'Sponsor Agreement' – Held that:- Activity is proved to be 'sponsored of the event service' but during the relevant time the 'sponsorship of the sports event' was fully exempt from service tax - in the case of DLF Ltd. (2012 (5) TMI 404 - CESTAT, NEW DELHI ) it was held that the IPL 20-20 tournament is a sports event, applicants are exempt from the levy of service tax as per Section 65(105)(zzzn) of the Finance Act, 1004 – pre-deposit waived

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• 2012 (11) TMI 975
  

  Demand of service tax – reimbursement of expenses - under the category of Manpower Recruitment & Supply Agency Service - denial of credit - separate Returns have not been filed as required under Rule 9(9) of CENVAT Credit Rules, 2004 – Held that:- the activities of the appellant may not deserve to be considered as 'supply of manpower' but as rendering of 'information technology software service' and in the light of the stay granted in the case of ASM Technologies Ltd. (2012 (11) TMI 974 - CESTAT, BANGALORE), the appellants are eligible for waiver of pre-deposit.

  As regards, the denial of CENVAT credit, we have not been shown that there is a requirement of filing separate Returns under Rule 9(9) of the CENVAT Credit Rules, 2004 and therefore, there is no warrant to order pre-deposit.-deposit

  As regards the reimbursable expenses relating to employees deputed to USA, undisputedly, the activities have taken place in USA and, therefore, the liability to service tax may not arise – stay allowed

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• 2012 (11) TMI 974
  

  Waiver of pre-deposit - Manpower Recruitment or Supply Agency Service – reimbursement of expenses - employees were deputed to the premises of the clients and they were working under the direct supervision of Project Managers working with the appellant and the intellectual property relating to the software developed continued to rest with them and if any right was to be passed on to the clients, the same was required to be specifically assigned to the clients subject to the conditions mentioned in the agreements. – held that:- the activities may fall under the category of ‘Information Technology Services' and may not be classifiable under the category of ‘Manpower Recruitment or Supply Agency Service'. – stay granted.

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