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Showing 381 to 400 of 1328 Records
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2014 (4) TMI 949
Denial of rebate claim - Reply not filed in time - Ex parte order passed - Violation of principle of natural justice - Held that:- impugned order passed is in violation of the Principles of Natural Justice. The notice was issued on 28.08.2007. 7 days' time has been allowed to file the reply. Certain documents had been relied upon in the show cause notice. In paragraph 15 of the writ petition, it is stated that the said show cause notice has been received by the petitioner on 29th August, 2007, therefore, the petitioner has 7 days' time to file the reply. According to the petitioner, the reply was filed on 4.09.2007. In paragraph 16 of the writ petition, it is stated that the reply of the show cause notice was filed, which has been replied by the paragraph 18 that the reply was not filed within time. It is further stated that it has been replied on 6th September, 2007 when the order was passed. The 7 days time granted to file the reply appears to be less and in as much as the authority should have waited up to 6th September 2007, while the order was passed exparte on 05.09.2007. Moreover admittedly the documents relied upon in the show cause notice have not been provided to the petitioner. - Matter remanded back - Decided in favour of assessee.
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2014 (4) TMI 948
CENVAT Credit - Whether, the Tribunal was correct in allowing CENVAT Credit on Insurance Services for payment of Service Tax on output service viz., Manpower recruitment or Supply agency services’ wherein such services do not have any nexus for providing the output service and do not qualify as ‘input service’ as per Rule 2(1)(i) of CENVAT Credit Rules, 2004 - Held that:- In so far as Insurance coverage to the employees is concerned in the course of employment if the employees suffer injury or dies, there is a vicarious liability imposed on the employer to compensate the employee. If the employer employs its own transportation facility in order to cover the risk which also includes the risk of workers who are covered in that statutory establishment, he has to take the insurance policy without which the vehicle cannot go on the road. Under the Workmen’s Compensation Act he has to obtain the Insurance Policy covering the risk of the employees. The Employee State Insurance Act takes care of the health of the employees also and casts an obligation on the employer to provide insurance services. Under these circumstances, this Group Insurance Health Policy though is also a welfare measure is an obligation which is cast under the Statute that the employer has to obey.
Section 38 of the Employees State Insurance Act, 1948, mandates that subject to the provisions of the Act, all employees in factories or establishments to which this Act applies shall be insured in the manner provided by this Act. May be the employees also have to contribute but the employer is under an obligation to take an Insurance policy and contribute his share. Therefore, the said Group Insurance Health Policy taken by the assessee is a service which would constitute an activity relating to business which is specifically included in the input service definition - Following decision of COMMISSIONER OF CENTRAL EXCISE, BAGNALORE v/s M/S. STANZEN TOYOTETSU INDIA (P) LTD., BANGALORE [2011 (4) TMI 201 - KARNATAKA HIGH COURT] - Decided against Revenue.
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2014 (4) TMI 947
Validity of Adjudicating Authority, Customs Letter - Execution of Bond for provisional release of goods - Seizure of fabric rolls - Direction to re-measure fabric rolls – Held that:- Assessee is ready to fulfil the conditions for provisional release of the goods - However, the grievance of the petitioner is that the mahazars dated 10-2-2012 and 3-7-2012 show different quantity of fabrics - Therefore, Respondent No. 3 is directed to re-measure the fabrics at the cost of the petitioner, at the time of delivering possession, in the presence of the petitioner, after the petitioner fulfils all the conditions mentioned in the letter dated 18-2-2013 vide Annexure-J - Assessee can furnish the translated version of Annexure-C to the concerned Authorities – Decided partly in favour of Assessee.
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2014 (4) TMI 946
Refund of amount recovered – Invocation of Bank guarantee - Discharge of Export Obligation - Free shipping bills and DEEC Shipping bills - Held that:- From the order passed by the first respondent and the Appellate Authority, it is clear, the bills produced by assessee are free shipping bills and not DEEC Shipping bills - Unless aseessee discharges his export obligation and produces discharge certificate from the competent authority, the petitioner cannot contend that Bank guarantee cannot be invoked – According to Paras 4.25 and 4.26 of the Handbook the license holder shall furnish EP copy of shipping bill(s) containing details of shipment effected or bills of export in case of export to SEZ - Before discharging BG/LUT against physical exports, the Customs shall verify that the details of the exports as given in the “Redemption Certificate” are as per their records.
Assessee sought for conversion of free shipping bills into DEEC Shipping bills that has not been granted – Thus, Respondents 1 and 2 have invoked the Bank guarantee - As the Bank guarantee has already been invoked, it may not be appropriate to direct the Respondents 1 and 2 to refund the amount unless the petitioner produces the discharge certificate from the competent authority regarding discharge of export obligation - As and when the petitioner produces the discharge certificate, the Respondents 1 and 2 may consider refund of the amount which has been realised by invoking the Bank guarantee – Decided against assessee.
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2014 (4) TMI 945
Quashment of FIR – Property in question repurchased which formed basis of the surety bonds - Section 482 of CrPC, 1973 – Section 420 IPC – Held that:- Since, the land which had been sold by Petitioner`s husband to one Sanjeev Goyal has been repurchased by him - Thus, presently Petitioner`s husband is the owner of the property in question - Petitioner had furnished surety bonds along with her husband – Thus, continuation of criminal proceedings against the petitioner would not serve any useful purpose, as now property in question is again owned by her husband which formed basis of the surety bonds - Accordingly, FIR and Challan u/s 420 IPC and 120-B IPC and all the subsequent proceedings arising therefrom are quashed – Decided in favour of Applicant.
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2014 (4) TMI 944
Winding up of company - inability to pay debts - whether the defence raised by the respondent is a bonafide defence - Held that:- winding up petition is admitted and the petitioner is directed to publish the citations in the ‘Statesman’ (English) and ‘Veer Arjun’ (Hindi) for a hearing to be held on 12.08.2014. The Official Liquidator is also appointed as a Provisional Liquidator to take charge of the assets and the books of accounts of the respondent company. The Directors of the respondent company will file the Statement of Affairs within 21 days of the appointment of the Provisional Liquidator coming into effect.
The respondent company is restrained from selling, transferring, encumbering or in any manner alienating any of its assets - However, in order to enable the respondent to make arrangements to discharge its dues and to arrive at an amicable settlement with the petitioner, the directions for publication of citations and for appointing the Official Liquidator as a Provisional Liquidator will not come into effect for a period of four weeks from today. The order admitting the winding up petition is also kept in abeyance for a period of four weeks. In the event, the respondent is able to discharge its debts to the petitioner or arrive at an amicable settlement for repayment of the same within the period of four weeks, the directions as stated above will not come into effect. In the event the parties are unable to arrive at an amicable settlement for discharge of the dues of the petitioner, the counsel for the petitioner shall inform the Official Liquidator, who shall on receipt of such communication proceed to take the necessary steps in accordance with law and in conformity with the directions as issued herein - Decided conditionally in favour of assessee.
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2014 (4) TMI 943
Validity of auction sale - Violation of mandatory Rules 8 and 9 of SARFAESI Act - Proper notice not issued - Valuation of property not done before auction sale - High Court set aside sale - Held that:- there were no terms settled in writing between the parties that the sale can be affected by Private Treaty. In fact, the borrowers – respondent Nos. 1 and 2 were not even called to the joint meeting between the Bank – Respondent No.3 and Ge-Winn held on 8th December, 2006. Therefore, there was a clear violation of the aforesaid Rules rendering the sale illegal - generally proceedings under the SARFAESI Act, 2002 against the borrowers are initiated only when the borrower is in dire-straits. The provisions of the SARFAESI Act, 2002 and the Rules, 2002 have been enacted to ensure that the secured asset is not sold for a song. It is expected that all the banks and financial institutions which resort to the extreme measures under the SARFAESI Act, 2002 for sale of the secured assets to ensure, that such sale of the asset provides maximum benefit to the borrower by the sale of such asset. Therefore, the secured creditors are expected to take bonafide measures to ensure that there is maximum yield from such secured assets for the borrowers.
Sale consideration is only ₹ 10,000/- over the reserve price whereas the property was worth much more. It is not necessary for us to go into this question as, in our opinion, the sale is null and void being in violation of the provision of Section 13 of the SARFAESI Act, 2002 and Rules 8 and 9 of the Rules, 2002.
letter dated 13.11.2006 sent by the borrower to the Bank clearly depicted that the borrower had waived his right under Rule 9 (1) and the provisions contained in Rule 9(3) and Rule 9(4) as well. It was also found that at the time of auction sale on 11.1.2006, the borrower was present but did not object to the auction being held before expiry of 30 days from the date of which public notice of sale was published. Not only this, he agreed that the bid given by the auction purchaser, which was the highest bid, be accepted as the auction purchaser happened to be his known person. Another important feature which was noted was that the borrower expressly gave consent in writing that the balance sale price may be accepted from the auction purchaser even when tendered after some delay and the sale certificate be issued to him. There was a written agreement between the borrower and the Bank for extension of time upto 15.4.2006 within which the auction purchaser had made the payment.
Court came to the conclusion that condition in Rule 9(4) viz. “such extended period as may be agreed upon in writing between the parties” would be treated as substantially satisfied. Again, pertinently, the Writ Petition was filed by the borrower more than 4 years after the issuance of the sale certificate. On these facts the court concluded that there was a waiver of the aforesaid mandatory provisions by the borrower.
From what is argued by the appellants, at best it can be inferred that the borrower tried to thwart the earlier attempts of the Bank in selling the property. When the first notice was issued, the borrower filed the writ petition. However, it is to be borne in mind that in the said Writ Petition no interim order was passed staking the auction on the stipulated date. The only stay granted was against confirmation of sale. That did not preclude anybody from participating in the auction. We are mindful of the ground realities that many times pendency of such a Writ Petition challenging the auction notice and the kind of stay granted, even partial in nature, deter the intending buyers to come forward and participate in the auction. Be as it may, we find out that even in the second attempt when the reserve price was reduced to ₹ 2.39 crores, the highest bid received was in the sum of ₹ 2.25 crores. Further, even the bid of the appellant which was accepted was in the sum of ₹ 2.16 crores. Likewise, after the second auction when the Bank requested the borrower to accept the bid of ₹ 2.25 crores giving its reasons and the borrower instead of doing so took initiative resulting in OTS but defaulted therein, it would merely indicate that the borrower was at fault in not adhering to the OTS. By no logic it can be deduced therefrom that the Bank was relieved from its obligation not to follow the mandatory procedure contained in the Rules, while taking fresh steps for the disposal of the property - Sale set aside - Order of High Court confirmed - Decided against appellant.
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2014 (4) TMI 942
Confirmation of addition u/s 145(3) and section 68 of the Act - Rejection of books of accounts – Held that:- The contention of the assessee for setting aside the matter on the file of the AO is just and appropriate because during the search, books of accounts have been seized and there is nothing placed on record to show that such books of accounts have ever been handed over to the assessee and assessee had along been contesting for verification of the accounts from the books of accounts being held with the tax authorities – thus, the matter is remitted back to the AO for fresh adjudication – Decided in favour of Assessee.
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2014 (4) TMI 941
Entitlement for exemption u/s 10(23C)(vi) of the Act – Exemption u/s 11 of the Act – Deposits and donations added – Nature of the Institution – Educational OR profit motive - Revenue was of the view that the donations are not voluntary and they are linked to the admission of the students to the educational institutions of the assessee, and thus, the assessee has collected higher fee over and above the prescribed fee limit - Held that:- The assessee is an educational society registered under S.12A of the Act, and its objects as appearing in the memorandum of association are for carrying on activities of general public utility in the field of education and charitable purposes – the assessee has received donations from the parents of the prospective students seeking admissions into the assessee's educational institutions - A list of such donations together with the particulars of the donors has also been furnished before the Revenue authorities - The AO has proceeded to decide the issue of assessee's claim for exemption, merely on the basis of suspicions and surmises, and the CIT(A) simply confirmed the action of the Assessing Officer, ignoring the findings and observations of the Assessing Officer in the remand reports and other material available on record.
The GOMs. No.33 by the Government of Andhra Pradesh in respect of formulation of rules for admission into the Under Graduate Professional Courses in Engineering in Unaided Non-Minority Professional Institutions was issued on 20.6.2003, which is after the closure of the academic year under consideration, viz. 2002-03 - those Government orders are of no application to the year under appeal, viz. assessment year 2003-04, in the case of the present assessee - In any event, there were no violation of the rules –also, in the absence of any clinching material brought on record by the Revenue, to indicate that there were, in fact, violations warranting denial of exemption under S.11 of the Act - the assessee is entitled to exemption under S.11 of the Act - the additions made by the AO in the have no legs to stand – the order of the CIT(A) set aside - Decided in favour of Assessee.
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2014 (4) TMI 940
Extension of stay of outstanding demand – Denial of deduction u/s 80IA of the Act – Held that:- The extension of stay should be granted to the assessee – the decision in Atos Information Technology vs. ITAT [2014 (3) TMI 729 - BOMBAY HIGH COURT ] followed - when there is no change in circumstances which first led to granting of stay and continuing of the same by the Tribunal and accepted by the revenue, there is no reason as to why the stay should not be extended – thus, the stay is granted for a period of three months – Decided in favour of Assessee.
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2014 (4) TMI 939
Revision u/s 263 - Claim of exemption u/s 10(10C) of the Act – Compliance of provisions of Rule 2BA of the Rules - Assessee had taken Voluntary Retirement and had received compensation of Rs. 6.01 lacs – Held that:- The decision in Uma Subramanian & two others [2014 (3) TMI 801 - ITAT MUMBAI] followed - the view taken by the AO while allowing the claim of the assessee for exemption u/s.10(10C) in the assessments framed u/s.143(3) was a possible view and the CIT was not justified in treating the assessments as erroneous and prejudicial to the interest of revenue - as held in Dy. CIT v. Krishna Gopal Saha [2009 (7) TMI 173 - ITAT CALCUTTA-B] the assessee, who had exercised the option for retirement under the Scheme floated by the employer bank and had received the compensation from the employer bank, was entitled to exemption u/s.10(10C) even though the said scheme was not in conformity with the requirement of Rule 2BA - thus, the assessee was entitled to get benefit of the exemption provided u/s.10(10C) of the Act - the order of the FAA is reversed – Decided in favour of Assessee.
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2014 (4) TMI 938
Minimum alternate tax (MAT) - Addition of reserves - adjustment of book profits - Retrospective amendment in clause (g) of Explanation (2) to section 115JA - Whether the CIT(A) erred in deleting the addition made to book profit in respect of provisions for bad and doubtful debts holding that the provisions are made against the ascertained liability - Held that:- The decision in Whirlpool of India Limited and Another Vs. Union of India and Others. [2013 (3) TMI 414 - DELHI HIGH COURT] followed – the purpose of the Explanation is to broaden the base amount on which tax is payable by the company - No new levy is imposed - The tax-base stands widened by the amendment in as much as the amount or amounts set aside as provision for diminution in the value of any asset and debited to the profit and loss account shall be added to the book profit - the amendment does not provide for any new levy of income tax, there is no question of it being struck down on the ground of retrospectivity – the order of the CIT(A) set aside – Decided in favour of Revenue.
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2014 (4) TMI 937
Jurisdiction u/s 153A of the Act – Held that:- CIT(A)’s view that in cases assessment u/s. 153A can be made without finding any seized material is not sustainable - it is not denied that it was a valid search and material was found from the premises which also houses of the group companies in which the assessee is also a Director – Relying upon CIT vs. SM Aggarwal [2007 (3) TMI 226 - DELHI High Court] it cannot be said that AO has assumed jurisdiction without any material found during search - Whether addition on the basis of the said material is sustainable or not is a matter which has to be considered subsequently after the assumption of jurisdiction - the contention of the assessee that the assumption of jurisdiction u/s. 153A was not proper cannot be accepted - the material was found from the premises which also belonged to the assessee group company – thus, the jurisdiction of assessment u/s. 153A was valid – Decided against Assessee.
Failure in rebuttal of legal presumption u/s 132(4)/292C of the Act – Held that:- The seized material in the shape of diary did not belong to the assessee - It belonged to the assessee’s brother - He has not at all been confronted with the contents of the diary - Assessee cannot be called upon to explain the contents of diary which belonged to the assessee’s brother and was found from the brother.
There is no mention of the assessee’s name in the particulars of diary - Though there is mention of the farm house belonging to the assessee, there is no mention of the total price paid etc. - the seller has denied having taken any money over and above the disclosed sale consideration - Even the total price paid for the property is not mentioned in the seized material - The jottings in the diary by no stretch of imagination can be treated as conclusive proof of on money transactions by the assessee - It is not the case that the circle rate or the value as per stamp registration authorities of the impugned property is more than what has been disclosed - Relying upon CIT vs. Kalyansundaram [2007 (9) TMI 25 - SUPREME COURT OF INDIA] - there is no case that any part of the jottings in the diary has been corroborated from any other findings - presumption u/s 132(4A)/292C of the Act cannot be taken against the assessee – the addition of on money transaction is not sustainable – Decided in favour of Assessee.
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2014 (4) TMI 936
Deduction u/s 80IC – Manufacture activity - air spring assembly - Held that:- The assessment order for the assessment year 2007-08 shows that the deduction u/s. 80IC has been allowed even in assessment u/s. 143(3) of the Act - Relying upon CIT vs. Modi Industries [2010 (8) TMI 51 - DELHI HIGH COURT] - once the claim for deduction u/s 80J has been allowed to the assessee in the first year and also for the subsequent two years, such deduction was allowable in the subsequent assessment years within the period of 5 years - the assessee has been granted deduction u/s. 80IC in earlier years and that also in assessment u/s 143(3) of the Act - Now in the 3rd year the Revenue cannot suddenly take up the ground that the assessee is not doing any manufacturing and therefore, is not entitled for deduction u/s. 80IC.
The assessee is engaged in manufacture and production of an article or thing named air spring assembly - The assessee imports air spring component (fitted in the top plate) and emergency air spring component (fitted in the emergency spring and calibrated with the bottom plate) - These items are imported from Germany from M/s ContiTech Luftfedersysteme GmbH (Hannover, Germany) - Rest all other goods / raw materials required in the manufacturing process are procured from India and employed by the Appellant in the manufacturing process at the Paonta Sahib Unit - The description of manufacturing process amply proves that the imported material as well as local materials are used in a manufacturing process which results in a final product which is quite distinct from the components used, and has distinct usage too – thus, the order of the CIT(A) set aside and the Assessee was engaged in manufacturing of air spring assembly and is hence eligible for deduction u/s. 80IC for the manufacturing activity undertaken at its Paonta Sahib unit – Decided in favour of Assessee.
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2014 (4) TMI 935
Validity of revised return – Termination of agreement – Held that:- The decision in Commissioner of Income Tax v. Shoorji Vallabhdas and Co. [1962 (3) TMI 6 - SUPREME Court] followed - The assessee already had this knowledge before completing the assessment and at the time of filing the revised return, therefore, at the first instance in the original return, even if the assessee had estimated profit out of the agreement entered into with M/s Mayflower Inno Reality Private Limited, immediately after understanding that the agreement would not be executed, he filed the revised return restating the correct income - Even though the formal termination agreement was executed later on, the assessee was very well aware before the completion of assessment that the income stated in the original return was wrong. In that way, the original computation of income filed by the assessee was “wrong statement”.
When that is so, the case of the assessee is covered by Section 139(5) which enables him to file a revised return to state the real income available in hands, for the purpose of assessment for the assessment year - the real question is not whether income is received on accrual basis or on receipt basis, but, it is whether actually there was an income at all - If no income is likely to arise in the hands of the assessee, there is no fun in estimating income hypothetically on the basis of accrual concept - before the completion of assessment and before the expiry of time available for filing of revised return, the assessee observed the wrong statement made in the original return regarding the quantum of income and revised the return by stating the correct income liable for taxation - It had come to the knowledge of the assessee that he was not going to earn that much of income stated in the original return filed by him - the revision made by the assessee is justified - thus, the CIT(A) is justified in deleting the income from the income assessed by the AO – Decided against Revenue.
Disallowance of expenses – Held that:- The business carried on by the assessee is as a facilitator for locating and aggregating land for builders and developers - Even though the agreement with M/s Mayflower Inno Reality Private Limited was vitiated later on, the expenses of Rs. 68,40,000/- have been incurred by the assessee in the course of carrying on of his business - It is the business of the assessee to enter into agreements with big parties for procurement of large parcels of land - even if an agreement is cancelled later on, the nature of expenditure incurred remained the same - What is spent is spent - When the expenses are incurred for the purpose of business, it has to be allowed as an expenditure irrespective of the income or loss from the particular agreement – thus, the order of the CIT(A) set aside – Decided in favour of Assessee.
Assessment of share from the AOP – Held that:- An assessee having been assessed for his share from HUF as well, is entitled for the rebate in tax – the AO is directed Officer to give the assessee the benefit of rebate in tax while concluding his assessment – Decided in favour of Assessee.
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2014 (4) TMI 934
Deletion made u/s 68 of the Act – Unexplained sundry creditors – Held that:- The CIT(A) was of the view that the addition in appellant's income could not be made on the basis of apprehensions as done by the AO - At the most these apprehensions may be a 'lead' for further investigation so-as-to establish the actual fact - The AO has not carried out any investigation on such lines - The only issue raised by the AO now remains that instead of sundry debtors, the assessee should have shown equivalent amount as 'cash-in-hand' in the balance sheet and thus should have paid wealth-tax on it - The AO's suggestion, though looking rosy from his angle, could only be implemented if such fact is established on record.
The onus of proving it lies with the department and such approach could not be taken merely on the basis that the outstanding balances of sundry debtors could not be verified - Be it as may, since 'cash-in-hand' could not be treated as income in appellant’s hands by any stretch of imagination either u/s 68 or u/s 69 of the Act, the addition made by the A.O. does not stand - there are inherent contradictions in AO's approach in giving treatment to the closing balances of sundry debtors - The opening balances which could be verified from the books of accounts of the assessee cannot be added in current year's income as done by the AO – the AO was not justified in making addition u/s 68 or u/s 69 of the Act – Decided against Revenue.
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2014 (4) TMI 933
Validity of proceedings u/s 153C of the Act – Income from house property and income from capital gain – Held that:- The decision in Hardevi Keshwani Versus A. CIT, Central Circle, Agra [2013 (8) TMI 105 - ITAT AGRA] followed - No satisfaction note has been recorded in this case before initiating proceedings u/s. 153C of the IT Act - The AO did not make any addition against the assessee on the basis of any adverse material - No material is produced to prove that the AO in the case of person searched was satisfied that any money, bullion, jewellery or other valuable articles or things or books of accounts, or documents seized or requisitioned belong to or belonging to a person other than person referred to in section 153A of the IT Act - No material is produced to show if any satisfaction was recorded by the AO in that case that the seized material belongs to the assessee.
The requirements of section 153C are not satisfied - May be the assessee owned up Rs.4,00,000/- cash found during the course of search and declared in assessment year 2008-09, but according to the assessee, it was regular assessment u/s. 143(3), i.e., after search was completed - the conditions of section 153C are not satisfied, thus, there is no justification to sustain the initiation of proceedings u/s 153C of the IT Act – the order of the CIT(A) set aside – Decided in favour of Assessee.
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2014 (4) TMI 932
Deletion of adjustment u/s 92CA(3) of the Act – Selection of comparables – Held tha:- While finalising the ALP,TPO had added two new comparables i.e. FEL and MIL to the eight comparables adopted by the assessee, that because of the inclusion of the two companies variation in operating margin arose, that the operating margin was within the range of 5% of the arithmetic mean of the operating margin of the comparable companies – the TPO had not given any reason as to why he was including FEL and MEL in the list of comparables - He did not give any notice to the assessee for inclusion of two new variables.
Basic principles of natural justice demand and expect that assessees should be heard, before fastening tax-liability to them - It is not known as how did the TPO arrive at the conclusion that FEL and MEL could be compared with the other companies for arriving at operating margin. Similarly, it is also not known as whether both the companies were in the same line of business or not. If the TPO had some definite information, he should have brought it on record and should have confronted the assessee with it - It would have given a chance to the assessee to defend itself - By not affording an opportunity to the assessee, TPO had taken a unilateral decision and such decisions cannot be endorsed - TPO had not found any defect in TP Study carried out by the assessee - TPO had not discussed the reason for not accepting the operating margins of AIL, though the said company was in the same business - If the average operating margin shown by the assessee is compared with AIL, it is clear that same was within the +/-5% of the margins/transactions and was allowable as per the rules - while considering the basic data of AIL had ignored vital factors that have been highlighted by the FAA - FAA had correctly held that international transactions entered in to by the assessee were at arm's length and that no adjustment was required – Decided against Revenue.
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2014 (4) TMI 931
Reassessment u/s 147 of the Act – reasons recorded for initiation of reassessment proceedings - Held that:- When the reasons for reopening the assessment itself is incorrect, the AO accepts that position by not making related addition, no further additions can be made in the course of such reassessment proceedings - The very initiation of reassessment proceedings in such a case ceases to be of any effect – Relying upon N.D. Bhatt, IAC v. I.B.M. World Trade Corpn. [1993 (7) TMI 7 - BOMBAY High Court] - the AO has not challenged the CIT(A)'s deletion of quantum addition made on the basis of reasons recorded for reopening the assessment - the reassessment proceedings were infructuous and no other additions could have been made by the AO either - CIT(A) has given categorical findings which run contrary to the reasons recorded while reopening the assessment and yet the revenue authorities have not raised, either in appeal or by any other mode, even a whisper against such findings which have thus reached finality - The very reassessment proceedings were also based on erroneous reading of facts which cannot lead to a legally sustainable addition – Decided in favour of Assessee.
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2014 (4) TMI 930
Determination of ALP u/s 92C of the Act - Transfer pricing adjustment - Addition on interest – Held that:- Junk bond rate canot accepted while analyzing loans advanced internationally – Relying upon Siva Industries & Holdings Ltd. Versus Assistant Commissioner of Income-tax, Company Circle-VI(4), Chennai [2011 (5) TMI 451 - ITAT, CHENNAI] - assessee has advanced a loan of USD$150,000 to CES, USA @ 6% interest per annum - Another loan of USD$ 6,80,000 was converted into equity share capital and the value of interest received up to the date of conversion was at Rs. 15,56,833/-, for which rate of interest calculated at Libor Plus 157 basis points - Assessee has adopted Libor + 1.57% base points, there was no reason to restore the matter to the TPO as the rate of Libor + can be considered as ALP – Decided in favour of Assessee.
Exclusion of communication expenses – Held that:- The decision in ITO v. Saksoft Ltd. [2009 (3) TMI 243 - ITAT MADRAS-D] followed - the AO is directed to exclude the communication expenses from the total turnover also and workout the deduction accordingly – Decided in favour of Assessee.
Determination of ALP u/s 92C of the Act - Transfer pricing adjustment – Income from software segment, ITES segment and capital advances to AE – Held that:- As already decided that these companies are not to be selected on various reasons, the objections of Assessee s upheld and the TPO/AO is directed to work out the arithmetic mean of PLI on the balance of companies – Decided in favour of Assessee.
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9911796707
