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Showing 361 to 380 of 1477 Records
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2016 (4) TMI 1118
Method adopted for working out the profit - Held that:- The assessee is engaged in the two similar business activities. There were certain common expenditures such as employment cost, administrative cost and depreciation cost which the AO apportioned 100% to the activity i.e. growing and manufacturing of tea leaves of the assessee on the ground that these cost have to be necessarily incurred by the assessee irrespective of any other the business activity. Therefore the allocation of these expenses is not required between the above sources is not required. However the ld. CIT(A) deleted the addition made by the AO. We understand that for any activity of the business several expenses are required to be incurred. The addition has been made by the AO on the surmise that these expenses are fixed in nature. The ld. DR also failed to bring anything on record contrary to the finding of the ld. CIT(A). Hence, we have no hesitation in upholding the order of Ld. CIT(A) and this ground of Revenue’s appeal is dismissed. - Decided in favour of assessee
Deduction u/s 80IB - Held that:- The assessee did not submit the relevant details at the time return filing for the deduction under section 80IB of the Act on the presumption that the return of income was filed declaring loss. So there was no point to claim the deduction under section 80IB of the Act. However when the AO framed the assessment under section 143(3) of the Act at positive income then the assessee raised the issue of said deduction. However the same was disallowed by the AO in the absence of sufficient documents in support of the claim under section 80IB of the Act. In the instant case the order of the AO was reversed by the ld. CIT(A) and we upheld the order of the ld. CIT(A). So as a result the loss claimed by the assessee has been restored. Therefore in the event of the loss return filed by the assessee, the question for claiming the deduction under section 80IB of the Act does not arise. Accordingly in our considered view the issue of 80IB of the Act becomes irrelevant for the year under consideration. Therefore we are not adjudicating the same in the light of the provisions of the Act. Hence, we decide this effective ground against Revenue.
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2016 (4) TMI 1117
Taxability of management charges - fee for technical services(FTS)under Article-13(2)(a)(ii) of the India-UK DTAA r.w.s.9(1)(vii) - Held that:- The assessee had received ₹ 14, 78, 35, 401/-as royalty and ₹ 4.65 crores as MS, that it had claimed that managerial-charges, received by it, were not taxable in India, that the AO was of the view that notwithstanding two agreements entire management charges were taxable as FTS, that the FAA had held that half of the MS charges were to be taxed in India, that while deciding the appeal, he had not given any reason as to why 50% of the receipts should be treated as MS, that the asessee as an alternate plea had stated that if any addition was to be made it should have been restricted to 10-15% of the payment. We further find that the FAA had discussed a few services and has stated that same could be treated as MS. But, he has not analysed the bills that would given him a clear and fair idea as to which services were actually rendered by the asessee for the year under consideration and that which could be treated MS or otherwise. Without establishing the primary facts, he should not have decided the issue. We do not find any basis for holding that 50% of the managerial charges should be taxed. In our, opinion, matter needs further investigation and verification, as his order lacks reasoning. Therefore, in the interest of justice, we are restoring back the issue to the file of the FAA for fresh adjudication who will decide the issue afresh after affording a reasonable opportunity of hearing to the assessee.
Disallowance of business loss to be set off against long-term capital gain and income from other sources - Held that:- FAA was not justified in denying the setting off of losses arising out of bad dates and leave-encashment and that assessee could avail the benefit of provisions of the Act over the provisions of the DTAA for setting off of losses.
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2016 (4) TMI 1116
Allocation of Head Office expenses to units eligible for deduction u/s 80IB and 10B - only reasoning given by the Ld. Counsel of the assessee is that the head office has its own stream of income and therefore, only 50% of the expenses should be allocated - Held that:- It is an accepted factual position that head office has its own stream of income. Thus, under these circumstances, it cannot be said that the entire expenses incurred by the Head Office/Corporate Office were incurred as common expenses.
Therefore, under these circumstances the total expenses of the head office cannot be said to be available for allocation in other units. The Ld. Counsel has tried to justify that 50% of the total expenses of Head Office/Corporate Office, on an ad-hoc basis, should be taken as the expenses pertaining to the income earned by the head office, and balance 50% can be made available for allocation to all the units. But we find that Ld. Counsel has not given any transparent, scientific or concrete basis of bifurcation, nor has he given any reasoning as to why these expenses should be bifurcated on fifty-fifty basis. It is also noted by us that even lower authorities had not examined this aspect from this angle. This issue is likely to have far reaching implications and may create history in assessee’s hands in other years as well. Therefore, principally accepting the stand of the assessee that total expenses incurred by HO/CO are not available for allocation, but for determining that how much portion of these expenses is available for allocation to all the units, we send this issue back to the AO for reexamining this issue and finding out some fair, rational, transparent and scientific basis of bifurcation of these expenses and their allocation among all the units. The AO shall decided this issue afresh after considering all the facts and submissions and evidences as may be brought on record by the assessee in support of its contentions for which the AO shall give adequate opportunity of hearing. The assessee is free to raise all the legal and factual issues in this regard. Thus, with these directions we send this issue back to the file of the AO. - Decided in favour of assessee for statistical purposes.
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2016 (4) TMI 1115
Long term capital gain - apportionment of WDV - Held that:- Assessing Officer had made this addition on protective basis however, since this addition was not made in Asst. Year 2010-11, therefore, the addition was treated as substantive in the year under consideration. The facts in this regard are that the assessee had declared sale of land and building at ₹ 1.20 croes. The Assessing Officer held that since building was a depreciable asset, therefore, sale value is to be reduced from block of assets and land being a non depreciable asset. The long term capital gain is to be computed on sale of such land. The Assessing Officer while computing the long term capital gain apportioned the sale consideration of ₹ 1.20 crores between the land and building wherein he took the estimated value of building at ₹ 20 lac and assigned value of ₹ 1 Crore to land. The Assessing Officer held that since cost of acquisition of property was taken by assessee towards building on which depreciation was claimed in earlier years, therefore, the cost of acquisition of land was taken as Nil and thereby he calculated long term capital gain to the tune of ₹ 1 Crore. The learned CIT(A), on the other hand, apportioned the written down value of land and building as on 31.3.2008 between land and building on the same ratio on which Assessing Officer had apportioned the sale consideration between land and building and therefore, cost of acquisition of land was calculated and after applying indexed of cost of acquisition long term capital gain was calculated. We find that learned CIT(A) has taken a reasoned view and has rightly apportioned the WDV as on 31.03.2008 between land and building and we do not find any infirmity in the same.
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2016 (4) TMI 1114
Basis of valuation - determination of value of assets - Held that:- In this case, the assessee has produced all the records including the agreement between the API & that the assessee company, the confirmation as well as the affidavit categorically stated that the land was only acquired by the assessee company and the same will be given only to API & for that ₹ 20,000/- per acre will be given to the assessee company by API. This fact was never denied or tested by the Assessing Officer. The assessee was never the owner of the land and thus the valuation in respect of Wealth Tax was incorrectly done by the Assessing Officer. The CIT (A) has taken into account all these aspects and passed proper order. Therefore, the appeals of the Revenue do not survive. - Decided in favour of assessee
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2016 (4) TMI 1113
Validity of order passed ex-parte - Violation of principles of natural justice - Demand of Service tax - Invokation of extended period of limitation - Appellant provided services of protection, pipe laying using trenching/trenchless, reinstatement of trench, OFC cable blowing including other associated works to its clients - Appellant contended that it had carried out substantial part of work prior to levy of service tax and thus, there was no question of levy of tax on services rendered prior to date of levy of tax.
Held that:- appeal against the order of Commissioner (Appeals) was filed by the revenue before the Tribunal on 15.1.2009 but due to pendency before the Tribunal, it came up for hearing on 23.7.2014. No fresh notice of the date of hearing was received by the appellant. Thus, there was non appearance on the part of the appellant. The Tribunal after hearing the representative of the department allowed the appeal ex parte. Therefore, sufficient opportunity to represent its case was not afforded to the appellant before passing the impugned orders. Thus, there was violation of the principles of natural justice. - Appeal disposed of by remanding the matter back
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2016 (4) TMI 1112
Levy of Special Additional Duty (SAD) as per Circular dated 27th June, 2002 - on goods chargeable to duty under Additional Duties of Excise (Goods of Special Importance) Act, 1957 - Appellant submitted that the Supreme Court in one case had said that if there were circulars issued by the Central Board of Excise and Customs which place a different interpretation upon the said phrase interpreted in the judgment, such interpretation would be binding upon the revenue. Also in the alternative the petitioner was willing to prefer appeal before the statutory authority.
Revenue submitted that the circular was upheld by the judgment in one case and there not having been any appeal therefrom, such judgment had achieved finality. The petitioner was aware of the judgment and at best the different interpretation claimed could be made applicable on and from 17th July, 2015 the date on which the proviso was substituted. Also the importation of the goods in question assessed pursuant to interim order dated 18th June, 2003 were prior and up to the year 2003.
Held that:- the writ petition is disposed of with liberty to the petitioner to prefer a statutory appeal within a fortnight, if permissible in law. Since alternative efficacious remedy is to be availed of, this Court refrained from going into the merits of the matter. - Petition disposed of
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2016 (4) TMI 1111
Appellant submitted that by inadvertence, the matter could not be contested properly before the Tribunal - Held that:- whether it was inadvertence or not is itself a question of fact requiring inquiry and fixation of responsibility. It would have been appropriate for the Appellant to have first fixed responsibility for those who did not act in the best interest of the Revenue, taken administrative action against them and then have filed this appeal. The appeal has remained pending since 15.6.2015 and has been adjourned on several occasions. The Revenue has had more than sufficient time to do its home work and soul searching for fixation of responsibility but none appears to have been done. Therefore we decline to take up the appeal for consideration on merits at this stage and require the appellant to first display their bona fides by holding an inquiry, fixation of responsibility by way of appropriate punishment to the concerned in accordance with law only whereafter we shall take up the present appeal. - Adjourned for 2 months
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2016 (4) TMI 1110
Waiver of pre-deposit - Financial hardship - Appellant stopped the business since 2009 and is living on support of the State - Held that:- the Tribunal found a prima facie case in favour of the appellant. As there is no material placed before the Tribunal with respect to the financial hardship, but taking into consideration the oral pleading made on behalf of the appellant, the Tribunal directed 50% to be deposited. The order of the Tribunal cannot be found fault with. However, considering the fact that a voluminous material has been placed before us which, for some reason or the other, the appellant could not place before the Tribunal, it is appropriate to remit the matter on the aspect of predeposit for fresh consideration by the Tribunal, on the condition of the appellant depositing 10% of the disputed tax within eight weeks. On such deposit being made, the Tribunal shall either consider the application for waiver of the pre-deposit or take up the appeal itself and pass appropriate orders. - Appeal disposed of by remanding the matter
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2016 (4) TMI 1109
Cenvat credit on inputs namely, fabrics lying in stock or in process or on inputs contained in finished goods lying in stock as specified in the Table - appellant Company is a registered "Dealer" of grey fabric under the Central Excise Rules - Notification No. 35/2003-CE (NT) dated 10.04.2003 - Held that:- Grey fabrics directly purchased by processor from manufacturer, that would be undisputedly are input with the processor and merely because a dealer is introduced in between manufacturer and the processor, nature of product as input cannot undergo any change. So, the dealer is entitled to avail credit with Serial No. 1(c) of the Table as input. See COMMR. OF C. EX. & CUS., AHMEDABAD-I Versus RAJKAMAL TEXTILE TRADERS [2009 (2) TMI 476 - GUJARAT HIGH COURT] - Decided in favour of assessee
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2016 (4) TMI 1108
Refund claim in respect of excess paid duty - rejection of refund claim in respect of excess paid duty on the ground that the appellant have not challenged the order whereby the rebate was disallowed - Held that:- We do not agree with the finding for rejection of claim for the reason that the rebate against the export is granted under Rule 18 of CER, 2002 and notification issued there under, whereas in case of any duty which is paid in excess can be refunded under the general provisions of refund under Section 11B. Since the appellant had paid excess duty at the rate of 14% instead of correct duty payable at the rate of 10% the 4% though excess paid cannot be sanctioned as rebate, therefore the same was disallowed. However the adjudicating authority while disallowing the rebate also mentioned in the order that “for allowing a 4% of the duty paid in excess the claimant is required to follow the procedure as per Central Excise Law". Therefore the proceeding of rebate and proceeding of refund are two different proceedings. The appellant have rightly claimed the refund of 4% excess paid duty the same should have been disposed of on its own merit without getting influenced by the order dt. 20.4.2009 by which the rebate was disallowed. - Decided in favour of assessee
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2016 (4) TMI 1107
Exemption from duty claimed - footwear made exclusively of plastic material in terms of notification no. 18/2001-CE dated 26.04.2001 - exemption available to footwear made exclusively of plastic materials was sought to be denied to the appellant on the ground that certain non-plastic materials like fabric, PVC sole are used in the shoes made by the appellant - Held that:- Explanation-I inserted vide notification no.30/2001-CE was merely to remove doubts to the effect that if materials other than of plastic like buckles, tabs, eyelet stays or in-soles are used, the footwear still shall be deemed to be made exclusively of plastic materials. This scope of terms "exclusively of plastic materials" was further explained in the Board's Circular dated 30.05.2001. The Board clarified that the expression "footwear made of plastic materials" should be given its normal meaning. It was also clarified that explanation inserted is applicable for the past clearances also. We find that in these sets of facts, the denial of exemption to the appellant is not sustainable. There is no allegation that the footwear made by the appellants were not of plastic materials. The question is only on exclusive use of plastic material only. Keeping in view the clarificatory Explanation-I and Board's Clarification dated 30.05.2001, we find the footwear made by the appellant being essentially of plastic material, and giving the normal meaning of plastic footwear, the exemption is rightly available to the appellant. - Decided in favour of assessee.
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2016 (4) TMI 1106
Whether in the light of the statutory power of CCESC to exclusively exercise the jurisdiction of the officer of Customs, the impugned Corrigendum could have been issued on a date subsequent to the CCESC deciding to proceed with the applications filed before it - Respondent submitted that the order passed by the CCESC deciding to proceed with the application under Section 127C of the Act was passed without hearing the DRI.
Held that:- the Court notices that there was sufficient opportunity for the DRI, if aggrieved by the order passed by the CCESC, to have challenged that order in accordance with law. However, without adopting that course, it was not open to the DRI to have proceeded to issue a Corrigendum/Addendum to the SCN, since in terms of Section 127F(2) of the Act, the exclusive jurisdiction to deal with the matter vested with the CCESC. Hence, the DRI had, on the date it issued the Corrigendum, no jurisdiction to issue Corrigendum/Addendum which made a very significant change to the SCN whereby the classification of the imported goods was changed and the duty demand correspondingly increased. Therefore, the impugned Corrigendum/Addendum is plainly unsustainable in law as it contrary to Section 127F(2) of the Act.
Validity of the Corrigendum/Addendum before the CCESC itself - Held that:- this submission appears to be misconceived since no such Corrigendum/Addendum could have been issued in the first place when the CCESC was seized of the matter. So, the question of the CCESC deciding the validity of such Corrigendum does not arise. Also the Court does not wish to comment on the submission except by noting that it is over two years since the CCESC passed the above order. If the DRI decides to challenge the said order, such petition will be decided on its merits by the appropriate forum. Therefore, the Court quashes the Corrigendum/Addendum to the SCN and the petitioner is permitted to revive its application before the CCESC in terms of the order passed by the CCESC in the matter. - Decided in favour of petitioner
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2016 (4) TMI 1105
Seeking release of goods apprehended from the vehicles - Demand of 40% of value of goods - Deposited the tax demanded by Commercial Tax Tribunal for release of goods - Appellant submitted that truck contained some goods of Indian origin and some goods of foreign origin and, therefore, the goods of Indian origin could not have been the subject matter of proceedings before the Customs Department so, the goods of Indian origin have to be released pursuant to the order passed by the Tribunal and the goods of foreign origin can also be released subject to payment of fine under the provisions of section 125 of the Customs Act.
Held that:- it will be appropriate that the petitioners may file a representation before the Superintendent (Prevention), Customs Department, Lucknow Division, Lucknow raising all grievances. The petitioners can also apprise the officer that the goods of Indian origin are outside his jurisdiction and that even the goods of foreign origin can be released subject to payment of fine. If such a representation is filed, we have no reason to doubt that the Superintendent (Prevention), above shall take a decision expeditiously. - Petition disposed of
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2016 (4) TMI 1104
Demand of a sum equivalent to the bank guarantee amount as Customs Duty/Additional Duty of Customs together with interest - Failure to fulfil the export obligations - Licenses permitted the petitioner to import raw materials at 'Nil' rate of Customs duty and NIL rate of Additional Duty of Customs subject to the petitioner fulfilling its export obligations and producing Export Obligation Discharge Certificate (EODC).
Held that:- considering that this Court, under similar circumstances, in the case of Jonson Rubber Industries Ltd. Versus Union of India & Others [2016 (4) TMI 1022 - DELHI HIGH COURT] required the Adjudicating Authority to examine the matter afresh in the light of the EODC obtained by the Petitioner therein subsequently, the Court in the present case sets aside the Orders-in-Original dated 31st March, 2014 passed by the Adjudicating Authority in respect of two advance authorization licenses dated 19th April, 2007 and 13th June, 2008 and directs the Adjudicating Authority to consider the matter afresh in light of the Petitioner having obtained the EODC from the DGFT.
As regards Advance Authorization Licence dated 30th March, 2006 it is pointed out that the DGFT is yet to issue the EODC to the Petitioner. However, the Petitioner is confident that the DGFT will now issue the EODC without unnecessary delay and if the matter is remanded to the Adjudicating Authority, the Petitioner will be able to produce the EODC. On the strength of the above statement made on behalf of the Petitioner, the Court set asides the order dated 31st March, 2014 passed by the Adjudicating Authority in respect of the Advance Authorization Licence dated 30th March, 2006 and remits the matter to the Adjudicating Authority for decision afresh subject to the Petitioner producing the EODC in respect of such licence.
As regards the Advance Authorization Licence dated 25th October 2006, it is stated by the Petitioner that the Petitioner did not avail of the said licence at all and surrendered it by a letter dated 10th June, 2014. It is further pointed out that the DGFT wrote a letter dated 14th March, 2014 to the Commissioner of Customs in this regard and Deputy Commissioner of Customs in fact confirmed the said fact by letter dated 7th May, 2014. The Court is of the view that the Adjudicating Authority requires to take these facts into account and decide the issue afresh. Consequently, the order dated 31st March, 2014 passed by the Adjudicating Authority in respect of the Advance Licence dated 25th October, 2006 is set aside and the matter is remanded to the Adjudicating Authority for a decision afresh in the light of the above facts. - Petition disposed of
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2016 (4) TMI 1103
Validity of impugned order - Violation of principles of natural justice - No opportunity of personal hearing provided before passing the order - Held that:- the petitioner was not given an opportunity of personal hearing by the 2nd respondent, which is violative of principles of natural justice, the impugned orders dated 27.01.2016 passed by the 2nd respondent are liable to be set aside and accordingly the same are set aside. The matters are remitted back to the 2nd respondent for fresh consideration. The 2nd respondent is directed to decide the appeals on merits and in accordance with law, after affording due opportunity of personal hearing to the petitioner.
Demand of Tax - Engaged in business of providing service of passive telecommunication infrastructure to telecommunication companies - Held that:- in view of the above, the demand notice issued by the 1st respondent is liable to be set aside and accordingly, the same is set aside. - Appeal disposed of
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2016 (4) TMI 1102
Leviability of tax - as per Entry 69 of the Part C of the First Schedule to the TNVAT Act 2006 - Petitioner's claim of exemption as per the Entry 17A of the Fourth Schedule was rejected by the first respondent, by stating that it is not applicable for industrial preservative, sold under the name "Nipacides" - Held that:- in the interest of justice, the petitioner can be given an opportunity to putforth their case by producing necessary documents before the respondents, however, on payment of 75% of the tax calculated at the rate of 5%. - Petition disposed of
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2016 (4) TMI 1101
Restoration of names in the register of the members of the company - Held that:- CLB has considered the matter in detail with regard to the relief sought by the appellants herein insofar as restoration of their names in the register of the members of the company is concerned as per shareholding pattern as on 31/3/2005. As already noted, the appellants have no grievance with regard to that aspect of the matter. But in the latter portion of the impugned order, we find that the CLB has contradicted itself on the one hand by observing that the appellants appearing before the CLB had no locus standi to seek other reliefs while on the other hand by holding that they had not made out a prima facie case to seek the other reliefs. In our view, that is incorrect as once their names were restored in the shareholding pattern as also on restoration of their names in the register of the members of the company, they also had locus standi to seek other reliefs.
So far as other reliefs are concerned, we find from the impugned order of the CLB that it has simply observed that the appellants have not made out any prima facie case, particularly with regard to the oppressive acts purported to have been committed by the respondents, which were prejudicial to the interest of the company. The observations of the CLB while disposing the matter, are, to say the least, without going into the pleadings and also the material brought on record by the parties in that regard. The impugned order is cryptic and unsatisfactory without reference to the said material on record. In the circumstances, we are of the view that the matter has to be remanded to the CLB for reconsideration of the case insofar as the other reliefs sought by the appellants herein before the CLB are concerned.
As far as the relief granted by the CLB with regard to restoration of the shareholding pattern as on 31/3/2005 and the consequential reports issued are concerned, they are not interfered with in the appeal.
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2016 (4) TMI 1100
Reopening of assessment - waiver of loan as income u/s 41 - reasons to believe - Held that:- AO had reopened the assessment on the ground that the waiver of loan by the bank has escaped assessment. The same was pointed out in the audit objection. We have perused the audit objection and the reasons recorded by the AO for reopening the assessment. No doubt, on record the reasons recorded by the AO are based on his own reasons of view, but, the same was indulged on findings of the audit objection raised by the audit party as it can be considered as it will fall in the similar situation as held in the case of CIT Vs. PVS Beedies (1997 (10) TMI 5 - SUPREME Court ). But as the findings recorded by CIT, the timings of the correspondence of Addl. CIT, which is dated 13/03/2013 and timings of the notice u/s 148, which was issued on 26/03/2013 clearly shows that the reopening was done on the behest of the Addl. CIT. It clearly shows that the AO had not applied his mind independently even though the reasons recorded on the basis of the factual error pointed out by the audit party. The reasons for reopening an assessment need to be based on tangible material which has a live-link with the formation of the belief that there was an escapement of income. Therefore, we do not find any infirmity in the order of CIT(A) in quashing the reopening of assessment made by the AO u/s 147 of the Act.
Two instalments had to be paid in AY 2007-08. Even though, the assessee was following mercantile system, it cannot recognize the waiver of loan as income u/s 41 of the Act, since, as per the pre-condition for OTS, all the balance amount had to be settled, then only, the assessee can enjoy the benefit of loan waiver. In this case, it was clear that the assessee can only recognize the waiver of loan as income only when it pays the final instalment of waiver as per OTS conditions. Hence, the assessee was not in a position to recognize the above waiver as income u/s 41, on the contrary, the AO had not brought anything on record that the waiver of loan was relating to trading liability or any revenue expenditure was allowed against the above waiver. Hence, in our considered view, the above waiver of loan cannot be brought into tax net considering the fact that the waiver condition was not fulfilled during this AY and cannot be recognized as income u/s 41 during this assessment year - Decided in favour of assessee
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2016 (4) TMI 1099
Credit of TDS - CIT (A) not allowing credit of TDS deducted by our Bank on interest and deposited to the Income Tax Department and holding that the interest belongs to Police department and the provisions of section 199 are applicable - Held that:- In the present case the amount was deposited as FDR’s by the assessee on behalf of State of Rajasthan with the Bank of Rajasthan and on the FDR’s deposit the interest has been accrued . The TDS was deducted by the Bank on the interest accrued on the FDRs. In our view, the Revenue is taking the hyper technical plea of not returning the TDS to the assessee on the pretext that the amount has been deposited with the bank on behalf of State of Rajasthan. Since the State of Rajasthan is not a taxable entity, therefore, refund of TDS cannot be given to the State of Rajasthan. It is not disputed that the assessee after realizing the interest income from the bank has given back the amount to the State of Rajasthan . Similarly it is also undisputed that the refund of TDS has not been claimed by the the State of Rajasthan and is only claimed by the Assessee being the nodal agency of the State of Rajasthan for this project . In our view, no prejudice will be caused to any person if the TDS is refunded to the assessee being the nodal agency with the undertaking to return the amount to the State of Rajasthan. The TDS deducted by the Income Tax Department is directed to be paid to the assessee and we accordingly hold the same. - Decided in favour of assessee
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