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Case Laws
Showing 381 to 400 of 2015 Records
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2018 (12) TMI 1637
TDS u/s 194H - disallowance u/s 40a(ia) - assessee had failed to deduct tax at source from commission paid to Banks for providing credit card services - HELD THAT:- The so called bank guarantee commission is not in the nature of commission paid to an agent but it is in the nature of bank charges for providing one of the banking service. The requirement of Section 194H of the Act, therefore, would not arise. No question of law arises
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2018 (12) TMI 1636
Addition u/s 41(1) - liabilities written off and offered as income in subsequent years - HELD THAT:- Substantial question of law admitted - whether Income Tax Appellate Tribunal was justified in upholding the addition under section 41(1) of the Income Tax Act, 1961 in respect of liabilities written off and offered as income in subsequent years?”
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2018 (12) TMI 1635
Rectification u/s 254 - provisions of section 194H/40(a)(ia) was not adjudicated by the Tribunal - DR submitted that this is the case where a sum of ₹ 60 lakhs was paid by the assessee to M/s. Global Properties towards nomination fees for release of rights without making TDS - HELD THAT:- The issue of applicability of provisions of section 194H r.w.s. 40(a)(ia) was not adjudicated by the CIT(A) as he confirmed the addition on merits holding that the payment of ₹ 60 lakhs is non-genuine transactions.
Ideally, the Revenue should have filed an appeal against the said finding of the CIT(A). Without prejudice to the finding of the CIT(A) on merits of genuineness of transactions, Revenue did not file any appeal before the Tribunal on this issue. While adjudicating the ground of the assessee, the Tribunal decided the issue in favour of the assessee upholding the genuineness of transaction. Thus, raising this issue i.e. applicability of the provisions of section 194H r.w.s. 40(a)(ia) to the said genuineness of transaction as held by the Tribunal cannot be raised through this Miscellaneous Application route in the context of appeal of the assessee. Accordingly, the issue raised by the Revenue on merits stands dismissed. Miscellaneous Application filed by the Revenue is dismissed.
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2018 (12) TMI 1634
Depreciation at 60% on oil rigs - higher rate of depreciation on the hired out oil rigs - validity of section 147 proceedings - HELD THAT:- CIT(A) upheld the validity of the proceedings under section 147 but in respect of the merits, observed that the plant and machinery of the assessee i.e. oil rigs owned by them and are leased out to various mineral oil concerns like Reliance Industries Limited, Orles Ltd and ONGC Ltd and claimed 60% deposition on such rigs.
CIT(A) observed that the AO did not discuss the issue of the specific plant and machinery but ultimately held that the assessee is not a mineral oil concern and did not fulfill one of the basic conditions to entitle themselves to claim the depreciation at 60%. CIT(A), as a matter of fact, found that the assets of the oil rigs are wholly owned by the assessee and are used for the purpose of business of the assessee which is to give on lease these assets. Following the decision of the Hon’ble jurisdictional High Court in the case of HLS India [2011 (5) TMI 322 - DELHI HIGH COURT] learned Ld. CIT(A) granted relief to the assessee and deleted the addition.
It is not the case of the revenue that the ratio laid down by the Hon’ble jurisdictional High Court in the case of the HLS India Ltd (supra) has no application to the facts of the case but the only ground on which the AO did not follow the same is that the Department has preferred an SLP against such order to the Hon’ble Supreme Court [2012 (2) TMI 669 - SUPREME COURT OF INDIA]. Now the things are clear and SLP preferred against the orders of the jurisdictional High Court was dismissed. No illegality or irregularity in the finding of the Ld. CIT(A). We consequently uphold the said finding and dismiss the ground of appeal of the revenue
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2018 (12) TMI 1633
Classification of imported goods - Faceted Glass Beads - whether classified under Tariff Item 7018 10 20 leviable to nil rate of duty or under Tariff Item No. 7018 10 90 of the Customs Tariff Act, 1975? - Held that:- It stands held in the decision of the Tribunal in the case of Starlite Corporation, Bombay v. Union of India [1985 (12) TMI 61 - HIGH COURT OF JUDICATURE AT BOMBAY] that ‘chatons’ are classifiable as glass beads and eligible for exemption - appeal dismissed - decided against Revenue.
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2018 (12) TMI 1632
Mis-interpretation of case law - power of Commissioner (Appeals) to condone delay - Held that:- The Revenue has misinterpreted the ratio of Hon’ble Supreme Court judgment in Thakker Shipping P. Ltd. [2012 (11) TMI 39 - SUPREME COURT]. The said judgment relates to powers of condonation of delay of appeals filed before the Tribunal - To extrapolate that ratio of the judgement to condonation of delay or otherwise by Commissioner (Appeals) is not correct in law. In the circumstances, no merit is found in the appeals filed by the Revenue on this score - appeal dismissed - decided against Revenue.
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2018 (12) TMI 1631
Approval of the Resolution Plan - performance of bank guarantee - HELD THAT:- The prayer made by the applicant deserves to be accepted. It has come on record that performance bank guarantee is a sine qua non as has been rightly contended by Mr. Vashisth, learned Senior counsel for the applicant-resolution professional. The 'Process Note' dated 18.05.2018 as modified on 21.06.2018, in categorical terms deals with performance bank guarantee.
Within ten business days of the date of issuance of LOI, the Liberty House being successful Resolution Plan applicant was to provide performance bank guarantee of ₹ 60, 00, 00,000/- in favour of State Bank of India which was the Bank on behalf of the COC. Even the format for furnishing the performance bank guarantee has been provided in the 'Process Note' itself. Clause 1.9.3 makes it patently clear that non-submission of performance guarantee by the successful applicant as per the requirement of Clause 1.9. 1 would lead to rendering the Resolution Plan by such successful applicant as non-responsive as the resolution professional would be entitled to reject the Resolution Plan and cancel the LOI.
It is pertinent to mention that after the approval of the Resolution Plan on 30.08.2018 by the COC, the LOI was issued on 30.08.2018 itself when by e-voting COC has approved the Resolution Plan. It is also pertinent to notice that the terms and conditions for submission of binding resolution proposal for company which makes it clear by Clause 1.11.2 that the Liberty House was under obligation to fulfil the terms of the 'Process Note'.
In respect of M/S. Amtek Auto Ltd. and M/ s. Adhunik Metaliks Limited again Liberty House has presented its Resolution Plans. It is represented that the Resolution Plans in both the cases have been approved and in the aforesaid two cases also the Liberty House is dragging its feet. We are unable to accept the contention advanced on behalf of the Liberty House that litigation is pending, therefore, no notice of such a fact could have been taken by the COC in its meeting dated 19.11.2018
As prayed the period from 04.09.2018 till date is excluded from the CIR Process - HELD THAT:- The act of the court shall harm no man - Actus Curiae neminem gravabit and that the aforesaid maxim is firmly rooted in our jurisprudence. Therefore, the period from 04.09.2018 till today deserves to be excluded from the CIR Process period of 270 days. The period of 270 days in any case is yet to come to an end. Therefore, the resolution professional may place the matter before the COC for further decision in accordance with law.
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2018 (12) TMI 1630
Invocation of the Bid Bank Guarantee - restraining encashment of which the suit was filed - The senior counsel for the plaintiff states that though the plaintiff has not so spelt it out but the plaintiff is also seeking return of the BBG inasmuch as till it is returned, the defendant no.1 can always make a fresh invocation - Held that:- When there is a cause of action therefor and the suit be not entertained - application disposed off.
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2018 (12) TMI 1629
Validity of assessment order - case of petitioner is that the equal addition made by the Assessing Officer cannot be sustained, since the equal time addition for probable omission is not called for - Held that:- This Court, at this stage is not willing to express any view, as admittedly, the petitioner ought to have agitated the matter before the next fact finding authority viz., the Appellate Authority, by filing a regular appeal. In this case, they have not chosen to file such reply. Therefore, this Court is not inclined to entertain these writ petitions.
However, the factual aspects of the matter have to be agitated and adjudicated before the next fact finding authority viz., the Appellate Authority. Hence, this Court is inclined to grant liberty to the petitioner to file a statutory appeal as against the impugned orders subject to a condition that the petitioner should pay 50% of the tax liability before the Assessing Officer.
Petition disposed off.
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2018 (12) TMI 1628
Extension of stay granted - stay extended for 180 days - eligibility of deduction under section 80IC - HELD THAT:- We have gone through the Tribunal Orders granting stay on various occasions i.e. the first order on 29.09.2017, wherein the detail order granting stay was passed. In view of the above, we are of the view that the stay should be extended for 180 days from today. Accordingly, we grant the stay and appeal is already fixed for hearing on 31.01.2019, for which no further notice to either parties will be sent. Stay is extended.
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2018 (12) TMI 1627
Freezing of Bank accounts of the petitioner - grant of installments for payment of dues - petitioner claims financial distress to pay the admitted liability under the service tax laws - Held that:- There is an admitted liability so far as the petitioners are concerned. The Central Board of Excise and Customs circular dated February 28, 2015, which contemplates that, the instalments may be granted is qualified. The instalments can be granted to an entity who is in financial distress - In the present case, there is nothing on record to establish financial distress. Balance sheet of the company is not on record.
The petitioners not having made available such relevant documents to Court and the petitioners not being in a position to secure the claim of the department, no fruitful purpose would be subserved by staying the operation of the letter dated October 23, 2018 - The balance of convenience and inconvenience is not in favour of grant of such order. In the event, the order of freezing of account is lifted, the petitioners would be in a position to take away the money from such account and defraud the revenue.
Petition dismissed.
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2018 (12) TMI 1626
Monetary limit involved in the appeal - Board Circular F.No.390/Misc./163/2010-JC dated 17.12.2015 - Held that:- Considering the fact that the circular itself carves out certain exceptions, we are of the view that the Department should not be foreclosed from raising such a plea before the Tribunal and if the Tribunal is satisfied that the case would fall within the exceptional circumstances, then the matter needs to be dealt with on merits or otherwise, the Tribunal will be well within its jurisdiction to close the appeal on the ground of low tax effect - the matter should be remanded to the Tribunal for a fresh consideration.
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2018 (12) TMI 1625
Penalty u/s. 271(1)(c) - non specify the limb of section 271(1)(c) for which the penalty was initiated - non-application of mind rendering the penalty illegal and invalid - defective notice - HELD THAT:- When penalty proceedings are sought to be initiated by the revenue under Section 271(1)(c) the specific ground which forms the foundation therefor has to be spelt out in clear terms. Otherwise, an assessee would not have proper opportunity to put forth his defence. When the proceedings are penal in nature, resulting in imposition of penalty ranging from 100% to 300% of the tax liability, the charge must be unequivocal and unambiguous. When the charge is either concealment of particulars of income or furnishing of inaccurate particulars thereof, the revenue must specify as to which one of the two is sought to be pressed into service and cannot be permitted to club both by interjecting an ‘or’ between the two, as in the present case. This ambiguity in the show-cause notice is further compounded presently by the confused finding of the Assessing Officer that he was satisfied that the assessee was guilty of both. See THE PRINCIPAL COMMISSIONER OF INCOME-TAX-I, VISAKHAPATNAM VERSUS SMT. BAISETTY REVATHI [2017 (7) TMI 776 - ANDHRA PRADESH HIGH COURT]
The penalty proceedings initiated by the Assessing Officer are bad in law and liable to be quashed. Hence we quash the penalty proceedings/order and delete the penalty levied by the Assessing Officer u/s. 271(1)(c) of the Act. - Decided in favour of assessee
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2018 (12) TMI 1624
CENVAT Credit - input services - construction of residential colony in remote area - period November 2009 to March 2010 - Held that:- All the input services in question incurred for the upkeep and maintenance of the colony is an essential business expenditure and accordingly, Cenvat Credit is allowable under the provisions of Rule 2(l) of the Cenvat credit rules, 2004 - credit allowed - appeal allowed - decided in favor of appellant.
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2018 (12) TMI 1623
Interest income - correct head of income - Income from other sources or Income from Business and Profession - HELD THAT:- No infirmity in the order of the CIT(A) so far as the treatment of the interest from customers and suppliers as ‘business income’ and interest from bank and other sources as ‘income from other sources’ is concerned. However, a contention has been raised by the Ld. Counsel for the assessee that where there is a direct nexus between the interest income earned and the interest expenditure incurred in this respect, the assessee should be allowed netting of the same before computing the same under the head ‘income from other sources’. We find merit in the above contention of the assessee
Allowability of dedction of other income u/s 10B, 80IB and 80IC - rent, Misc. receipts, DEPB, commission brokerage of ocean freight and interest income as ‘other income’ - brokerage of ocean freight is nothing but refund / rebate out of the freight expenditure - HELD THAT:- Assessee has fairly agreed that except the brokerage from ocean freight, the other items do not constitute income derived from undertaking. Assessing officer is directed to consider the rebate on ocean freight as income of the undertaking of the assessee.
Adjustment of Head office expenses for computation of deductions u/s 10B, 80IC and 80IB - HELD THAT:- CIT(A) while holding so above, however, has directed the Assessing officer to allocate the net Head office expenses and not the gross net expenditure. We do not find any infirmity in the order of the CIT(A) on the issue and the same is accordingly upheld.
Taxing the amount received on sale tax exemption / subsidy - revenue or capital receipt - HELD THAT:- The issue is now covered by the various decisions of the Hon'ble High Courts including the decision of the Hon'ble Supreme Court in ‘CIT-I Vs. M/s Chaphalkar Brothers, Pune and Others’ [2017 (12) TMI 816 - SUPREME COURT] wherein, it has been held that the aforesaid receipt is a capital receipt and not exigible to taxation. We hold accordingly and the lower authorities are directed not to tax the aforesaid receipts.
Disallowance u/s 14A - HELD THAT:- The assessment year involved admittedly is 2006-07. The Hon'ble Bombay High Court in the case of ‘Godrej & Boyce Manufacturing Co. Ltd.’ [2010 (8) TMI 77 - BOMBAY HIGH COURT] held that Rule 8D of the Income Tax Rules is applicable from the assessment year 2008-09 onwards and that for the year prior to assessment year 2008-09, the disallowance u/s 14A is to be made on some reasonable basis. Considering all confirm the disallowance u/s s 14A of the Act on this issue for the year under consideration.
disallowance of foreign travel expenses of director's wife - allowable business expenses - HELD THAT:- The interest of justice will be well served if 50% of the expenditure incurred on the foreign traveling of the wife of the director is allowed. We, therefore, confirm the disallowance upto the extent of 50% of the aforesaid amount and the remaining 50% of the disallowance on this issue is ordered to be deleted.
Premium payable on redemption of optionally convertible foreign currency bonds - Revenue or capital expenditure - Nature of expenditure - HELD THAT:- Admittedly, in the year under consideration, the assessee has booked the aforesaid expenses payable which was paid in the assessment year 2011-12. In view of this, the said expenditure is to be allowed in the year of payment. Subject to the above observation, this ground of the assessee’s appeal for the year under consideration is hereby dismissed.
Treatment to interest reimbursement under Technology Upgradation Fund Scheme (TUFS) - Revenue receipt OR capital receipt - Additional ground - HELD THAT:- Admittedly, this ground has been taken as addition ground which has not been examined by the lower authorities. The Ld. Counsel for the assessee submitted that in the earlier years also this issue has been restored to the file of the CIT(A) for decision afresh. Considering the above submissions of the Ld. Counsel for the assessee, this additional ground is restored to the file of the CIT(A) for adjudication afresh in accordance with law
Exclusion of loses debited in the accounts in respect of which insurance claims were received for deduction u/s 80IB and 80IC and exemption u/s 10B - HELD THAT:- Assessee in this respect has invited our attention to the paper book page 2 wherein the details of the items has been given on which insurance claim was received. However, after perusal of the same, it is not clear as to which of the items constituted capital assets and which of the items constituted trading asset of the assessee. We therefore, restore this issue to the file of the assessee to bifurcate the items between capital assets and trading assets and to allow the claim in respect of insurance claim received on trading assets only.
Allowability of foreign exchange fluctuation gain for deduction u/s 80IB and 80IC and exemption u/s 10B - assessee submitted the foreign exchange fluctuation gain is in respect of export receipts / receivable of the assessee and any gain in respect of receivable on account of foreign exchange fluctuation in fact contributes to the profits of the assessee from the sale/ export of the products - HELD THAT:- We find force in the aforesaid contention. We do not find any infirmity in the order of the CIT(A) in this respect also directing the Assessing officer not to reduce foreign exchange fluctuation gain from eligible profits of units eligible for deduction
Allowbility of deduction u/s 80IB in respect of unit which has already claimed exemption u/s 10B - Double deduction - HELD THAT:- It is not a case of double deduction, hence we do not find any infirmity in the order of CIT(A) on this issue also. The order of the CIT(A)on this issue is accordingly upheld in allowing deduction u/s 80IB in respect of unit which has already claimed exemption u/s 10B
Treating the income from sale of shares - capital gains or income from speculative loss - HELD THAT:- Ld. CIT(A) has rightly held that it was not a case of speculative / trading in sale and purchase of the shares. The Ld. CIT(A) therefore, has rightly treated the same as income from capital gains while following the order of his predecessor for assessment year 2005-06. In view of this, we do not find any infirmity in the order of the CIT(A)
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2018 (12) TMI 1622
Corporate Insolvency Resolution Process - pre-existing dispute - application under Section 9 filed - HELD THAT:- It is seen that as early as October, 2017 which is much prior to the issue of Section 8 notice being the notice of demand by the OC to the CD dated 22.1.2018, there has been a pre-existing dispute as between the parties. Further it is also alleged by CD that the work awarded in relation to the work order has not been completed which had forced it to award the balance work to another contractor. The quantum of work which had been completed and the amount payable thereon, if any cannot be decided in a summary manner by this Tribunal.
This Tribunal is hence not required to look beyond as while considering the petition filed under Section 9 of IBC,2016 where the documents as filed by the petitioner itself discloses that there has been a dispute in pre-existence prior to the issue of Section 8 notice the same will suffice for its rejection.
Hon'ble Supreme Court in Mobilox Innovations (P.) Ltd. v. Kirusa Software (P.) Ltd. [2017 (9) TMI 1270 - SUPREME COURT OF INDIA] in relation to the pre-existence of dispute, this Tribunal is required to dismiss the petition taking into consideration Section 9(5)(ii)of IBC, 2016. Petition dismissed.
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2018 (12) TMI 1621
'Mark to Market' Loss - disallowance of loss on foreign exchange forward contract loss - whether the said loss was a notional loss and hence cannot be allowed? - HELD THAT:- The issue raised herein stands concluded against the Revenue and in favour of the respondent assessee by the decision of this Court in CIT Vs. M/s. D. Chetan & Co.[2016 (10) TMI 629 - BOMBAY HIGH COURT]
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2018 (12) TMI 1620
Assessment u/s 153A - independent enquiry to determine the existence of incriminating evidence in the seized material - Addition of share application money received u/s 68, addition of commission allegedly paid on the share application money and disallowance u/s 14A - granting no right to cross-examination a witness - HELD THAT:- Additions are not based on any incriminating material found during the course of search. The alleged statements recorded from entry operators have been admittedly retracted by them and the Assessing Officer has not based the additions on these statements.
When copies of the alleged statements recorded by the revenue officials have not been given to the assessee, no addition can be made based on such evidence which is not confronted to the assessee. The contents of the statements are also not brought out in the assessment order. Only a general reference is made that there were certain statements recorded from various entry operators by the investigation wing. No addition can be made on such general observations.
We also find that the assessee has not been given an opportunity to cross-examine any of these persons, based on whose statements, the ld. D/R claims that the additions have been made. The Hon’ble Supreme Court in the case of Kishinchand Chellaram vs. CIT [1980 (9) TMI 3 - SUPREME COURT] had held that the opportunity of cross-examination must be provided to the assessee.
Even otherwise, it is not clear as to which of these statements were recorded during the course of search operation u/s 132 of the Act or whether the statements were recorded during the course of any survey operations u/s 133A of the Act. It is well settled that a statement recorded during the course of survey operation cannot be used as evidence under the Act.
Coming to the alleged cash trail, none of the material gathered by the Assessing Officer by way of bank account copies of various companies supposed to be part of the chain of companies was not confronted to the assessee. The alleged statements that were recorded from directors of these companies which formed this alleged chain were also not brought on record. Only a general statement has been made. There is no evidence whatsoever that cash has been routed from the assessee company to any of these chain of companies. No evidence that any cash was deposited by the assessee company. Moreover, there is no material whatsoever brought on record to demonstrate that the alleged cash deposit made in the bank account of a third party was from the assessee company. No opportunity to cross-examine any these parties was provided to the assessee. The bank statements based on which the cash trail was prepared are part of the disclosed documents and cannot be held as incriminating material.
None of these material gathered by the Assessing Officer can be categorized as incriminating material found during the course of search or found during the course of any other operation under the Act merit addition - decided in favour of assessee.
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2018 (12) TMI 1619
Rectification of Mistake - error apparent n the face of record - Held that:- The errors pointed out by the Revenue are evidently mistakes apparent on the face of record from the facts - errors are allowed o be rectified - ROM application allowed.
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2018 (12) TMI 1618
Addition u/s 68 - unsecured loan from the person engaged in providing the accommodation entry - addition relying on statement of accommodation entry providers - proof to genuineness of loans - HELD THAT:- The assessee had provided income tax return acknowledgement of M/s Daksh Diamonds, account confirmation, bank statement of the assessee as well as M/s Daksh Diamond, audited financial statement, details of repayment of loan. The Ld. CIT(A) while appreciating that the assessee had proved the identity, creditworthiness and genuineness of loans had taken into consideration that the transactions of both the loan received and the repayment of the loan had passed through banking channels. At the same time, the AO had not led any evidence that any cash was paid by the assessee to the parties who had given the loan.
The statement of Bhanwar Lal Jain on which the AO has placed complete reliance was not given to the assessee. The proprietor of M/s Daksh Diamonds, Shri. Ritesh Siroya replied to the notice issued by the AO u/s 133(6) of the I.T. Act and offered to produce the party before the AO for examination. On the contrary, the AO merely relied upon the statement given by Shri. Bhanwar Lal Jain and the modus operandi and the affairs of BhanwarLal Jain group to make the addition. Also neither Mr. BhawarLal Jain nor Mr. Ritesh Siroya had taken the name of the assessee at any point of time to state that they had given an accommodation entry for loan to him.- decided in favour of assessee
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