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Showing 381 to 400 of 2855 Records
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2015 (10) TMI 2482
Seeking return of papers - Assessment order passed by 1st respondent questioned before 2nd respondent and paid an amount of ₹ 16,80,500/- and also furnished bank guarantee for ₹ 33,61,00/- by the petitioner. After having heard the appeal, the 2nd respondent rejected the contentions of the petitioner and dismissed the appeal as not entertainable holding that the dispute cannot be the subject matter of the appeal under Section 51 of the Act and instead of returning the papers to the petitioner, decided the issue relating to the provisions which is to be filed before the revisional authorities - Held that:- the impugned order of the 2nd respondent dismissing the appeal as against levy of tax on TDS and the consequential levy of penalty under Section 27(3) of the TNVAT Act, for want of jurisdiction, is set aside and the 2nd respondent is directed to return all papers to the petitioner. On receipt of such papers, the same shall be presented by the petitioner before the revisional authority complying with all the formalities. On such presentation, the authority concerned shall entertain the same without any reference to the period of limitation and dispose of the same in accordance with law. Petition disposed of
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2015 (10) TMI 2481
Reopening of assessment - Held that:- Assessing Officer has simply reopened the assessment for the purpose of verification of the certain transactions. In our opinion, when the Revenue wanted to verify the correctness of certain transactions, the proper course is to issue the notice u/s 143(2) within time. If the Revenue failed to issue notice u/s 143(2), it cannot resort to section 148 for the purpose of verification of certain transactions. Notice u/s 148 can be issued only when the Assessing officer records his satisfaction with regard to escapement of income. In the reasons recorded, there is no mention of the escapement of income; therefore, in our opinion, reopening of assessment is not valid and the same is quashed and consequentially, the assessment order passed in pursuance to such notice is also quashed. - Decided in favour of assessee
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2015 (10) TMI 2480
Entitlement to avail Cenvat Credit on cable tray - treatment to accessory to the capital goods - cable tray procured by the appellant for holding the cable in their factory for manufacturing of cement - Held that:- The cable tray is an accessory which holds the cable and in case of a fault through the cable tray the damage portion of the cable can be found out and same can be repaired. Without this cable tray smooth functioning of the plant is not possible. In these circumstances, thus hold that these cable tray are used to hold the cable for power distribution system.
In these circumstances, the appellant is entitled to take Cenvat Credit on cable trays being an accessory to the capital goods. - Decided in favour of assessee
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2015 (10) TMI 2479
Addition u/s 68 - there is a gap of 5 months between the withdrawal of the cash from the Bank account and re-deposit of the same in the Bank account - Held that:- No addition can be made u/s. 68 of the I.T. Act on the sole reason that there is a time gap of 5 months between the date of withdrawal from bank account of the cash in question and the redeposit of the same in the Bank Account, unless the AO demonstrates that the amount in question has been used by the assessee for any other purpose. In my view the addition is made on inferences and presumptions, which is bad in law. Hence, the addition in question is deleted. See AICT vs. Baldev Raj Charla [2008 (12) TMI 241 - ITAT DELHI-C ] - Decided in favor of assessee
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2015 (10) TMI 2478
Assessmnt u/s 153C - Held that:- Special leave granted and admitted appeal of Revenue against the Hon’ble Bombay High Court [2015 (5) TMI 656 - BOMBAY HIGH COURT] ruling that no addition can be made in respect of assessment which has become final if no incriminating material is found during the course of search.
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2015 (10) TMI 2477
Levy of fees under section 234E - intimation issued under section 200A in respect of processing of TDS - Held that:- We find that the issue in all these appeals is now squarely covered in favour of the assessee by the decision of ITAT Amritsar Bench in the case of Sibia Healthcare Private Limited vs. DCIT [2015 (6) TMI 437 - ITAT AMRITSAR] adjustment in respect of levy of fees under section 234E was indeed beyond the scope of permissible adjustments contemplated under section 200A.
As intimation under section 200A, raising a demand or directing a refund to the tax deductor, can only be passed within one year from the end of the financial year within which the related TDS statement is filed, and as the related TDS statement was filed on 19th February 2014, such a levy could only have been made at best within 31st March 2015. That time has already elapsed and the defect is thus not curable even at this stage. In view of these discussions, as also bearing in mind entirety of the case, the impugned levy of fees under section 234E is unsustainable in law. We, therefore, delete the impugned levy of fee under section 234E of the Act. - Decided in favour of assessee.
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2015 (10) TMI 2476
Penalty u/s 271(1)(c) - cash credit taken from the sister concern - Held that:- Relying upon the decisions of Hon’ble Jurisdictional High Court in case of National Textile vs. CIT (2000 (10) TMI 19 - GUJARAT High Court ) and CIT vs. Jalaram Oil Mills (2001 (6) TMI 15 - GUJARAT High Court) as well as to discussions made it is of the confirmed view that proceedings u/s. 271(1)(c) of the Act are separate proceedings and the observations and findings made during the original assessment proceedings, should not shadow over the proceedings u/s.271(1)(c) of the Act and the A.O. ought to have analyzed the evidences and supporting documents furnished before him during the penalty proceedings u/s.271(1)(c) and examined them in consonance to the provisions of Section 271(1)(c) and only if he is not satisfied with them, then only he should initiate the penalty against the assessee.
We, therefore, remit back the issue to the file of A.O. with clear directions to examine on merit the evidences and supporting documents to be submitted by assessee before him for proving the identity, creditworthiness and genuineness of the cash credit taken from its sister concern M/s Poonam Dyeing & Printing Mills Pvt. Ltd. and accordingly, should decide the issue of imposing penalty u/s.271(1)(c) of the Act. - Decided in favour of assessee for statistical purposes.
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2015 (10) TMI 2475
Cleaning services provided to Guru Gobind Singh Super Thermal Plant (GGSSTP), Ropar, Punjab - Appellant contended that it cannot be said that the service was provided to the commercial or industrial building and the premises thereof or factory, plant or machinery tank or reservoir of such commercial or industrial building and premises thereof. - Held that:- The power plant of the Electricity Board cannot be called a non-commercial concern in the normal sense of word as it produces electricity and sells the same. Indeed, electricity cannot be sold at any price less than the price fixed by the appropriate regulatory authority. Therefore, the cleaning service rendered by it to GGSSTP, Ropar clearly falls within the scope of cleaning service as defined in Section 65 (24b) read with Section 65 (105) (zzzd) ibid.
Prima facie case is against the assessee - Stay denied.
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2015 (10) TMI 2474
Entitlement to exemption u/s 11 - non maintaining separate books of accounts as required under provision of section 11(4A) - CIT(A) allowed the claim - Held that:- There is no dispute that right from inception, the assessee trust was granted exemption u/s 11 of the Act by the tax authorities. Even, if, the property is under dispute with the BMC authorities, cannot be the sole bases for denying exemption to the assessee. So far as, non-maintenance of separate books of accounts for different sports is concerned, we are in agreement with the finding of the ld. Commissioner of Income Tax (Appeals) that different sports are single activity of sports, therefore, cannot be treated as different activities of the trust. This view find support from the ratio laid down from Hon’ble Apex Court in Thanthi Trust (2001 (1) TMI 80 - SUPREME Court). There is further uncontroverted finding in the impugned order that the assessee trust is not running restaurant, bar, etc, thus, there is no question of maintaining separate registers. The activities of the assessee trust are for the attainment of objects of the trust enshrined in the trust deed. Thus, the assessee is having a valid registration u/s 12A of the Act, granted by the Director of Income Tax (Exemption) and the Assessing Officer has not specifically pointed out any violation of the trust deed as well as the provision of section 12 & 13, therefore, we find no infirmity in the conclusion drawn by the ld. Commissioner of Income Tax (Appeals). - Decided against revenue
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2015 (10) TMI 2473
Non-compete fees received on divesture of 'Leader' business - taxable as "Short Term Capital Gains" OR "Long Term Capital Gains" - Held that:- In the present case, we are dealing with a situation where the non-compete fee has been received by the assessee-company for not carrying on the business of what herbicide manufacturing (i.e. Leader business), which it was hitherto carrying on. Thus, what is transferred is right to carry on business, which is a capital asset. Thus, such sum is to be regarded as Capital gain, the cost of acquisition being determined in accordance with section 55(2)(a) of the Act. Accordingly, we are unable to uphold the stand of the Assessing Officer that non-compete fee is taxable as business income on account of section 28(va) of the Act.
Whether such capital gain is a long term capital gain or short term capital gain? - Held that:- CIT(A) has erred in treating the non-compete fee as a short term capital gain. In our considered opinion, the CIT(A) misdirected himself in considering as to when the “……. Right of not to compete came into existence….”; and, not taking into consideration the fact that the covenant of not to carry on business was (i) attached alongwith the transfer of leader business, which was being carried on by the assessee since 1997; and, (ii) for a period of 10 years, which is a fairly long period. Under these circumstances, the non-compete fee is to be assessed as long term capital gain. - Decided in favour of assessee
Gain on transfer of Distribution Network, Registration and Licenses, Copyrights and Goodwill - taxable as "Short Term Capital Gains" OR "Long Term Capital Gains" - Held that:- Regarding Distribution Network it has been explained that the sales of ‘Leader’ products were being made by the assessee-company through a dealer Distribution Network. The assessee company had entered into contracts/ arrangements with several distributors for sale and distribution of their products covered under Leader business. On transfer of leader business to Sumitumo, all the rights of the assessee company under such contracts/businesses arrangements in relation to leader business were transmitted in favour of Sumitomo as per the Business Transfer agreement. Since the Distribution Network was in the nature of business right existing for more than three years, in our view, the same has been rightly held by the CIT(A) to be taxable as long term capital gain.Regarding “Goodwill”, it was quite clear that the same is inseparable from business, which was in existence for more than three years, and it gets automatically transferred alongwith the business. Thus, the gain on transfer of Goodwill has to be assessed as long term capital gain. The stand of the CIT(A) is affirmed on this aspect also. Similarly, in relation to the gain on transfer of Registration and licenses and copyrights are concerned, the same have also been rightly treated by the CITA) as long term capital gains. - Decided against revenue
Disallowance u/s. 14A - assessee-company had earned dividend income which was claimed exempt u/s. 10(35) - Held that:- Assessing Officer has not complied with the jurisdictional prescription of section 14A(2) of the Act in as much as there is no objective satisfaction recorded by the Assessing Officer that the claim of the assessee made in the return of income was incorrect. Notably, in the present case assessee had suo-moto disallowed certain expenditure under section 14A of the Act and the Assessing Officer is empowered to disagree with it only after he was “not satisfied with the correctness of the claim…….” made by the assessee, having regard to the accounts of the assessee. Thus, in the absence of the recording of such satisfaction the disallowance over and above ₹ 20,39,893/- made out of administrative expenses is untenable and is hereby directed to be deleted. Apart therefrom we also find that even otherwise the disallowance estimated by the assessee at ₹ 20,39,893/- is reasonable considering that the same was even more than the estimation of 2% of dividend income canvassed by the CIT(A). In this manner, we hereby set aside the order of CIT(A) and direct the Assessing Officer to restrict the disallowance under section 14A of the Act to ₹ 20,39,893/- made in the return of income - Decided in favour of assessee
Recomputing value of closing inventory in accordance with the provisions of section 145A - Held that:- Apart from pointing out that even after applying the provisions of section 145A r.w. section 43B of the Act there would be no effect on profit, the assessee company has not substantiated the said plea. In any case we find that the direction of the CIT(A) to the Assessing Officer for adopting the value of opening stock in consonance with the value of closing stock adopted for the immediately preceding year does not require any interference, and is hereby affirmed. - Decided against assessee
Income derived from growing and selling of Hybrid Seeds - whether is to be considered as agricultural income so as to be eligible for deduction under section 10(1) as held by CIT(A) - Held that:- No merit in the ground raised by the Revenue as no fault can be found with the decision of the CIT(A), which is in consonance with the precedents in assessee’s own case - Decided against revenue
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2015 (10) TMI 2472
Disallowance for depreciation in respect of assets, the cost of which is claimed as application - Computation of income u/s 11(1)(a) - Held that:- Similar to the case of AP Olympic Association (2014 (2) TMI 988 - ITAT HYDERABAD ), we respectfully follow the decision rendered by the coordinate bench of this Tribunal in the said case, and direct the Assessing Officer to allow the claim of the assessee for depreciation in respect of the assets, the cost of which is claimed by the assessee as application. - Decided in favour of assessee
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2015 (10) TMI 2471
Detention of goods - TNVAT - details and value of returned goods were also declared in Form JJ - when the goods were moving to the supplier, the 1st respondent detained the goods vide impugned proceedings for the reason that the goods were transported with defective and invalid documents - the representative of the petitioner met the 1st respondent and produced all the required documents, even then the no orders came to be passed. - Held that:- Since the 1st respondent has not passed any orders even after production of required documents by the representative of the petitioner and in view of the above submission made by the learned Additional Government Pleader (Taxes), the 1st respondent is directed to pass necessary orders on the basis of the documents produced before him in support of the transportation, within a period of one week from today. - With the above directions, the writ petition is disposed of. No costs.
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2015 (10) TMI 2470
Penalty under S.271(1)(c) - assessment completed u/s 153A - Held that:- Considering all the aspects and the fact that the assessee has a good case on merits and that the provisions of Explanation 5A to S.271(1)(c) are not applicable on the date of filing of the original return, we are of the opinion that Explanation 5A as it stood on the date of filing the return in response to notice under S.153A by the assessee would not cover the case of the assessee, so as to warrant levy penalty under S.271(1)(c). Since the assessee bona-fidely declared the additional income in the course of search and filed return and paid taxes thereon, we are of the opinion that penalty levied on such amount cannot be sustained. Accordingly, we allow the appeal of the assessee and delete the penalty sustained by the CIT(A). See Dilip Kedia Versus Assistant Commissioner of Income-Tax, Central Circle-4 [2013 (7) TMI 934 - ITAT HYDERABAD ] - Decided in favour of assessee.
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2015 (10) TMI 2469
Determination of rent at fair market value - Held that:- Both the parties agreed that the same requires fresh examination at the end of the AO by duly considering the decision rendered by the Hon’ble jurisdictional Bombay High Court in the case of Tip Top Typography (2014 (8) TMI 356 - BOMBAY HIGH COURT ). Accordingly, we set aside the order of Ld CIT(A) on this issue and restore the same to the file of the AO with the direction to examine this issue afresh
Assessment of gains arising on sale of plot as business income - Held that:- We notice that the assessee has been holding various plots for quiet a reasonable time and hence he has declared long term capital gain on sale of two adjacent plots. We also notice that the assessee continues to hold other plots as his investments only. The long holding period, in our view, supports the case of the assessee. Further, it is not shown to us that the assessee has been indulging in repetitive transactions of purchase and sale in plots. It was also not shown that the assessee has borrowed funds for the purpose of purchasing plots. Since the AO has not brought on record any valid reason to support his case, we are of the view that the tax authorities are not justified in assessing the capital gain as his business income. Hence, we are not able to agree with the view taken by the Ld CIT(A) on this issue. Accordingly, we set aside the order of Ld CIT(A) on this issue and direct the AO to assess the profit arising on sale of plots as Capital gains.
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2015 (10) TMI 2468
Addition u/s 41 - increase in the capital reserve on waiver of loans - Held that:- The correlation of the loans borrowed by the assessee and the purpose for which they were borrowed and the loans waived to the assessee has to be established by the assessee. In the absence of correlation it is not possible to decide the purpose for which the loan has been availed by the assessee. It is only when the purpose of the loan is ascertained it can be decided as to whether the provision of section 41(1) of the Act will be attracted or not. We therefore set aside the order of the CIT(A) in so far as the addition sustained by the CIT(A) and remand the issue to the AO for fresh consideration in the light of the observations made above. The assessee is at liberty to file the required documents to substantiate its case regarding non applicability of the provision of section 41(1) of the Act or section 28(iv) of the Act.
In so far as the appeal of the revenue is concerned it is quite clear that from the order of the CIT(A) that the interest which was waived was not claimed as an expenditure by the assessee in the past and therefore the addition of the said sum u/s 41(1) of the Act cannot be sustained. In so far as the applicability of the provision of section 28(iv) of the Act is concerned the benefit in question was not received in kind and therefore the addition on the above said provision cannot be sustained. The decision referred to by the CIT(A) in the impugned order on this issue clearly support the conclusion arrived at by the CIT(A). We therefore do not find any ground to interfere. Consequently the appeal filed by the revenue is dismissed. - Decided in favour of assessee for statistical purposes.
Unexplained share application money - Held that:- In the light of the letter of the AO to Saurabjh Agrotech (P) Ltd., a copy of which is placed at pages 32 to 39 of the assessee’s paper book No.2, the additions sustained by the CIT(A) deserves to be deleted. It is clear from the evidence that identity, capacity and genuineness of the transaction of the receipt of share application money of the assessee has been clearly established. In fact the additional evidence in the form of confirmation from the share applicant ought to have admitted by the CIT(A) as additional evidence and in the light of the enquiry carried out by the AO which clearly established the receipt of share application money as genuine, the addition ought to have been deleted. We therefore direct that the addition sustained by the CIT(A) in this regard should be deleted.- Decided in favour of assessee.
Disallowance on account of alleged excess consumption of Hexane in Solvent Extraction Plant - Held that:- The AO did not reject the book results before resorting to an estimation of income. For rejecting the book results, the provisions of Sec.145(3) of the Act requires that the Assessing Officer should be not be satisfied about the correctness or completeness of the accounts of the assessee, or where the method of accounting provided u/s.145(1) of the Act or accounting standards as notified under Section 145(2) of the Act have not been regularly followed by the Assessee. The AO has to compute income from business accounting to the books of accounts of the Assessee. It is only when the book results are rejected the question of estimation of income arises for consideration. The AO has to specifically point out the defects in the books or incomplete and incorrectness in the books of accounts and call upon the Assessee as to why the books of accounts should not be rejected.
The above principle is applicable even when the AO doubts the correctness of the claim of expenditure made in the Profit and Loss Account. The AO has not doubted the purchase of Hexane. He has indulged in a guess work regarding the quantity of Hexane that is to be consumed in the process of manufacture of oil from oil cake. The AO has done this on the basis of a report of an expert. As to whether the report of the expert can be applied to all manufacturers of oil from oil cake and as to whether these are ideal quantity of consumption, is not spelt out in the order of the AO. The entries in the regular books of accounts which are duly audited have not been shown to be suffering from any infirmities. The past history of consumption of Hexane compares favourably with the consumption in the past and the AO has nothing to say about the past history. No such addition has been made in the past. In such circumstances, we are of the view that the addition made by the AO and confirmed by the CIT(A) was without any basis and cannot be sustained. - Decided in favour of assessee.
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2015 (10) TMI 2467
The appeal concerns the taxability of overriding commission. Appellant argues it should not be taxable, while Revenue disagrees. Both sides can argue further during the appeal hearing. Appellant must deposit Rs. 20,00,000 within eight weeks and comply by 29th December 2015. Balance demand will be stayed pending appeal.
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2015 (10) TMI 2466
Disallowance u/s 14A r.w.r. 8D - Whether on the facts and the circumstances of the case and in law, the Tribunal was justified in deleting the disallowance made as per sub clause (ii) of Rule 8D(2) r.w.s. 14A of the Act? - Held that:- As is evident from the proposed questions of law the impugned order of the Tribunal placed reliance upon the decision of this Court in Godrej & Boyce Mfg. Co. Ltd. Vs. DCIT [2010 (8) TMI 77 - BOMBAY HIGH COURT ] and held that Rule 8D of the Income Tax Rule, 1962 (the 'Rule') would not be applicable for the purposes of disallowance under Section 14A of the Act for assessment prior to Assessment Year 200809. In the above view the impugned order holds the disallowance has to be made on reasonable basis and not on application of Rule 8D of the Income Tax Rules for the subject Assessment Year 200607.
It is an agreed position between the parties that the issues arising herein stands concluded by the decision of this Court in Godrej & Boyce Mfg. Co. Ltd. (supra) and the same has been followed by the impugned order. - Decided against revenue
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2015 (10) TMI 2465
Utilisation of CENVAT Credit - GTA Service - Revenue contends that credit taken by assessee and reutilising it for payment of service tax is not tenable and as per Rule 3(4)(e) of Cenvat Credit Rules, 2004, Credit may be utilized for payment of service tax on any output services - Held That:- There is no ground to disagree with judgement and reasoning of Punjab and Haryana High Court in Nahar Industries Enterprises Ltd.[2010 (5) TMI 608 - PUNJAB AND HARYANA HIGH COURT] - Appeal lacks merit and rejected - Decided in favour of assessee.
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2015 (10) TMI 2464
Liability of Service Tax – Whether Setting up MICR-CPC to attend cheque clearance of Financial Institutions is Banking and Other Financial Services or not? – Appellant contended that as per definition Banking and Other Financial Services, there has to be a client or customer, which is absent herein - Cheque clearance activity rendered to other member Banks and not to customers – There was a bonafide conduct and no intention to evade tax – Revenue contends that liability of interest arises whether there is intention to evade tax or not.
Held That:- CBEC vide letter dated 25.02.2005 will indicate that amount collected as charges for clearing cheques or clearing house, under Banking and Other Financial Services, to that extent appeal fails on merits - On limitation also appellant could have contested the matter - There was no intention on appellant's part of evading tax liability, which would mean that demand of service tax liability can be only within the limitation period of one year - Appellant is not liable to discharge any interest on amount of service tax liability paid, appeal to that extent is allowed – Decision made in case of Gujarat Narmada Fertilizers Co. Ltd [2012 (4) TMI 309 - GUJARAT HIGH COURT] followed – Decided partially in favour of assessee.
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2015 (10) TMI 2463
Availment of CENVAT Credit - outdoor catering and guest house maintenance service - services are neither directly or indirectly used in or in relation to the manufacture or clearance of final products - Held that:- After amendment of the definition of input service with effect from 1.4.2011 the exclusion part of the definition takes in outdoor catering service also. But it is provided therein that the exclusion applies when such services are used primarily for personal use or consumption of any employees. The outdoor catering service/canteen services provided by the appellant is in compliance of mandatory requirement under section 46 of the Factories Act, 1948. The ground stated in the impugned order for disallowing the credit is that even though canteen facility is provided under the Factories Act, to the workers under statutory obligation, it does not have nexus either directly or indirectly to manufacture of final product.
Prior to the amendment of input service with effect from 1.4.2011 the definition of input service was very wide so as to include all activities that would come under the activities of business of manufacture. Annexure B shows that all invoices except 2 pertain to the period prior to 1.4.2011. These two invoices are dated 18.4.2011 and 18.5.2011. In a number of judgements, the CESTAT has held that guest house maintenance service and outdoor catering service in the guest house are eligible for credit. - appellant is eligible for credit on guest house maintenance services for the period from January, 2008 to December, 2011 except for the two invoices.
Appellants are entitled to credit on outdoor catering services and guest house maintenance services. - Decided partly in favour of assessee.
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