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2020 (5) TMI 714
Extension of hearing period on account of lockdown (third phase) in the whole country - outbreak of novel Corona Virus for the third consecutive year - HELD THAT:- For the consequential lockdown due to COVID-19 in three phases including the present one, working of this Court, other subordinate courts as well as judicial and quasi-judicial authorities working under the superintendence of this Court, has been affected to a great extent. The situation has resulted in hardship for the litigants and ordinary citizens to approach the court of law to take recourse to legal remedies. With a view to ensure that the litigants and citizens do not suffer on account of their inability to approach the court of law, we propose to invoke our plenary power under Article 226 and power of superintendence under Article 227 of the Constitution of India, our inherent power over the criminal matters under Section 482, Cr.P.C., our power of superintendence over criminal courts under Section 483, Cr.P.C. and our inherent power over the civil matters under Section 151 of the C.P.C.
All interim orders / directions issued or protection granted including any order requiring any compliance by the parties to such proceedings, passed by this Court or any court subordinate to it or any Family Court or Labour Court or any Tribunal or any other Judicial or Quasi Judicial forum in the State of Odisha, over which this Court has power of superintendence, which were subsisting as on the date of commencement of national lockdown, shall stand extended till 18th June 2020 - it is further directed that the interim orders or directions of any court in the State, which are not of a limited duration and were meant to operate till further orders, shall continue to remain in force until modified / altered / vacated by specific order of the court concerned in a particular case.
List this matter before the appropriate Bench on 18th of June, 2020.
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2020 (5) TMI 713
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - HELD THAT:- As to the facts of the present case, it may be seen that the Operational Creditor has raised various Invoices after supplying the materials to the Corporate Debtor and the Operational Creditor has also filed the Ledger Statement, which is maintained in the books of the Operational Creditor and a perusal of the same shows that a sum of ₹ 53,52,607.73/- is due and payable by the Corporate Debtor. However, on the contrary, the Corporate Debtor has also filed the Statement of Accounts in relation to the Operational Creditor maintained in their books of account, which goes to on show that only a sum of ₹ 60,169/- is pending to be paid by the Corporate Debtor to the Operational Creditor.
As to the facts of the case, from the records it is evident that a series of notices and reminders have been exchanged between the parties from the year 2012 and even the Corporate Debtor by their letter dated 09.03.2017 has disputed the claim of the Operational Creditor. Further, it may be seen that the Corporate Debtor at no point of time has admitted the liability of the Operational Creditor. In so far as the e-mail dated 29.10.2015 which is referred by the Operational Creditor as an admission of liability by the Corporate Debtor, a perusal of the same shows that no where the Corporate Debtor has stated that the sum is due and payable by them to the Operational Creditor - Further upon perusal of the documents filed by the Operational Creditor, the 'debt' and 'default' on the part of the Corporate Debtor cannot be ascertained.
Only upon when the accounts are reconciled, the exact amount, which has become due and payable by the Corporate Debtor can be ascertained. We are well aware of the fact that this Authority cannot reject the claim of the Operational Creditor on the ground of amount not having become crystallized. However, as to the facts of the present case, in order to ascertain the 'debt' and 'due' the accounts needs to be reconciled and only upon reconciliation, as also if any cost reduction is ascertained, it may pass on to the Corporate Debtor and in the said circumstances, we cannot beforehand presume that the debt as claimed by the Operational Creditor will cross the threshold limit as prescribed under Section 4 of the IBC, 2016.
Application dismissed.
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2020 (5) TMI 712
Seeking permanent injunction, to restrain the defendant from attempting to procure and/or attempting to induce a breach/termination of any agreement/arrangement between the third parties and the plaintiff in respect of non-functional properties of the plaintiff across India - restraint on defendant from entering into any agreement or arrangement with any third party in relation to any right/interest of the defendant with respect to non-functional properties across India, where agreement/arrangement for grant of property rights to the plaintiff has been executed but multiplex operations have not commenced - recovery of nominal damages - HELD THAT:- No merit is found in the contention of the senior counsel for the plaintiff, of the defendant being bound by any admission contained in the order dated 1st February, 2018 and admission of law does not bind any party to a lis less a counsel. Rather it appears that the suit as framed, is directed not only against the defendant but also against others who have not been impleaded. During the hearing it emerged that besides the plaintiff and the defendant there are only one or two others carrying on same business but on a much smaller scale than the plaintiff and the defendant. The effect of granting injunction as sought against the defendant, would be that the defendant even if has entered into agreements with the developer/owner of the Amritsar and Juhu, Mumbai properties, would be unable to proceed under the said agreements, leaving the developer/owner aforesaid in a lurch with respect to their properties meant for running and operating multiplex cinemas and who will have no option but to accept whatever commercial terms the plaintiff offers.
The claim of the plaintiff herein also is, to monopolize land and buildings thereon, across India, and just like agricultural produce was held to be natural resource, so is land a natural resource. Moreover yet another directive principle is, that the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment and the monopoly sought to be created by the plaintiff by seeking the injunction in this suit, to exclude the defendant from its forays to procure real estate for its business across India, would be against the said directive principle of State Policy - I reiterate that the grant of injunction claimed by the plaintiff on the premise of the actions of the defendant comprising a tortious act of interference with contractual relations of the plaintiff, would be in violation of the fundamental right of the defendant, its promoters and directors to carry on trade and business, without any law having been enacted by the State in this respect in the interest of general public, within the meaning of Article 19(5) of the Constitution of India.
The plaintiff, on the averments contained in the plaint, had no cause of action for the relief claimed against the defendant and the relief claimed by the plaintiff against the defendant is barred by law - the suit is dismissed.
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2020 (5) TMI 711
Maintainability of petition - Seeking interim reliefs on account of indirect/direct alleged breach of certain clauses of the Joint Venture Agreement and Licence and Technical Assistance Agreement - petition is barred by principles of Section 9(3) of Arbitration and Conciliation Act, 1996 or not - HELD THAT:- Perusal of the arbitration clause shows that the parties were ad idem that in' case respondent no. 1 initiated the arbitration, then the arbitration would be held in India and under the Commercial Rules of India Commercial Arbitration Association. However, arbitration would be held in Japan and under the Rules of Japan Commercial Arbitration Association (JCAA), in case it was initiated by M/s. Jay Industries. In the present case, it is undisputed that it is an international commercial arbitration and that the emergency arbitration and regular arbitration were invoked by the Indian entity. Hence, the seat of arbitration is Japan and the rules applicable are those of the JCAA.
The Constitution Bench of Supreme Court in the case of BHARAT ALUMINIUM CO VERSUS KAISER ALUMINIUM TECHNICAL SERVICE, INC AND OTHERS [2012 (9) TMI 912 - SUPREME COURT] prospectively overruled the decision in Bhatia International and held that Parti of the Act would not apply in cases of international arbitration where the seat of arbitration is outside India.
Pursuant to the 246th Report of the Law Commission, the Arbitration and Conciliation (Amendment) Ordinance, 2015 was promulgated, which was published in the Gazette of India on 23rd October, 2015 and came into effect immediately. The Arbitration and Conciliation (Amendment) Act, 2015 (hereinafter referred to as 'the Amendment Act') brought about various amendments in the Act, one of them being enactment of Section 2(ii) whereby Section 2(2) was amended by inserting a proviso. Provisions of Sections 9, 27 and 37(1)(a) and 37(3) of the Act were made applicable to international commercial arbitration where the place of arbitration is outside India and the arbitral award is enforceable under the provisions of Part II of the Act, subject, however, to an agreement to the contrary. Thus, in effect, the position in law went back to the stage prior to the decision in the case of BALCO - In view of the amendment to Section 2(2), it is clear that Section 9 of the Act, with which the present petition is concerned, is applicable even to international commercial arbitration held outside India, provided its applicability has not been excluded by-the parties by an agreement to the contrary.
Even on the anvil of doctrine of election, applicants have to fail. Applicants had consciously chosen to tread on a path and cannot turn around only because they were unsuccessful. It also needs a mention that the pleadings in the petition are really in the nature of an appeal pointing out flaws and infirmities in the order of the emergency arbitrator. Respondents are right that this court in a petition under Section 9 of the Act cannot sit as a court of appeal to examine the order of the emergency arbitrator.
Petition is not maintainable in this court and is accordingly dismissed.
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2020 (5) TMI 710
Denial of Issuance of statutory Form ‘C’ - inter-state purchases of goods - transit purchases under Section 3(b) of the Central Sales Tax Act, 1956 - second sale - Section 6(2) of the Central Sales Tax Act, 1956 to be read with Central Sales Tax (Registration and Turnover) Rules 1957 - it was held by High Court that In the facts of the present case, the transaction is covered by Section 3(b) and this petitioner is entitled to avail the benefit of concessional rate of tax provided under Section 6(2) of the Central Sales Tax Act, 1956.
HELD THAT:- There are no requirement to interfere in this Special Leave Petition. The Special Leave Petition is dismissed accordingly.
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2020 (5) TMI 709
Approval of closure of liquidation process of K.T.C. Foods Pvt. Ltd. - Regulation 45 (3)(a) read with Regulation 32A and 33(1) of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 (Liquidation Process Regulations 2016) - HELD THAT:- In the present case, the application is filed under Regulation 45(3)(a) read with Regulation 32A and 33(1) of the Liquidation Process Regulations 2016. Regulation 32A relating to selling as a going concern was inserted by the Liquidation Process Amendment Regulations 2019 and inter alia requires the Liquidator to identify and group the assets and liabilities to be sold as a going concern, in consultation with the Consultation Committee. Therefore, the response given in Column 2 Sr. No. 16 does not appear to be correct. In view of the reliance in the application on the Regulations of the Liquidation Process Regulations 2016 as amended by the Liquidation Process Amendment Regulations 2019, Regulation 31A of the Liquidation Process Regulations 2016 as inserted by the Liquidation Process Amendment Regulations 2019 was required to be complied with and stakeholders' Consultation Committee constituted. It is noted that as per Regulation 31A(9), the advice of the Consultation Committee is not binding on the Liquidator and there is a proviso that where the Liquidator takes a decision different from the advice given by the Consultation Committee he shall record the reasons for the same in writing.
The sole financial creditor is Oriental Bank of Commerce which has relinquished its security interest all the assets by e-mail dated 05.10.2019. However, there is no representation before us by Oriental Bank of Commerce that the stakeholders' Consultation Committee was not constituted and that this is prejudicial to the interest of Oriental Bank of Commerce. Similar representation has also not been made by any of the operational creditors. Therefore, no adverse inference is being drawn regarding non-constitution of the stakeholders' Consultation Committee.
Regulation 44(1) of the Liquidation Process Regulations 2016 is as substituted by the Liquidation Process Amendment Regulations 2019 dated 25.07.2019. It would not be in the interest of justice to keep the liquidation process of the corporate debtor ongoing, till the time the application for avoidance of transactions is finally decided, especially since KTC Foods is not being directed to be dissolved. Thus, even though the amendment of Regulation 44(1) is through the Liquidation Process Amendment Regulations 2019, the same be applied in the present case and notwithstanding the pendency of the Application No. 510/2019, the closure of liquidation process of the corporate debtor be directed.
In the application, the Liquidator has prayed for approval of the sale of the corporate debtor as a going concern to Shiv Shakti the highest bidder without any liabilities including contingent liabilities and with immunity from existing litigation if any against the corporate debtor. Reference has been made to Regulation 45 (3)(a) of the Liquidation Process Regulations 2016. Reference is also made to Regulation 32A and 33(1) of the Liquidation Process Regulations 2016. However, none of these provisions provides for any approval by the Tribunal of the sale as a going concern to the highest bidder. Therefore, the directions sought for cannot be granted.
In view of the provisions of Section 54 of the Code and Regulations 44 and 45 of the Liquidation Process Regulations 2016, it is directed that since the corporate debtor K.T.C. foods is sold as a going concern, the liquidation process of the corporate debtor K.T.C. Foods Private Limited be closed without dissolution of K.T.C Foods Private Limited and that Application 510/2019 for avoidance of transactions under Chapter III/ VI of Part II of the Code shall continue to be adjudicated upon by the Adjudicating Authority.
Application disposed off.
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2020 (5) TMI 708
Seeking release of gold ornaments and money in interim custody under Section 451 of the Code of Criminal Procedure, 1973 (Cr.P.C.) - custody to a person claiming to be the owner of jewellery/money without incorporating a condition that the said articles should be produced before the court, as and when directed, exactly in the same condition as they were at the time of entrustment - HELD THAT:- On a plain reading of Section 451 Cr.P.C., it can be seen that the power to order for custody and disposal of property pending trial has to be exercised by the court by applying judicial discretion and the arrangement once made thereunder is not even final till the conclusion of inquiry or trial. The court is having a right to terminate the entrustment, get back the property from the person to whom it was given and entrust it to somebody else whom the court deems fit. In cases of rival claims for interim custody, preference of one person over the other does not settle any right to ownership or possession.
The challenge is against conditions 2 and 4 imposed by the trial Judge. Condition 2 is relating to furnishing security in the form of bank guarantee for the value assessed by the court below. We find no reason to interfere with that condition as the jewellery items involved are of a considerable worth. Insofar as condition 4 is concerned, the court below shall allow the claimant to adduce evidence to establish a strong prima facie entitlement to the property. It may also ascertain whether there is any rival claimant for the gold ornaments involved in the case.
After considering the entire evidence on record, the trial court shall take a decision as to whether the petitioner should be directed to produce the articles before the court in the same condition as and when required by the court - matter shall be disposed by the court below as expeditiously as possible, at any rate within a period of one month from the date of receipt of a copy of this order.
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2020 (5) TMI 707
Seeking approval of Resolution Plan - Approval of the Carval Resolution Plan by CoC is in breach of proviso to Section 31(4) of the Code or not - Discrimination against Operational Creditor - Deliberate suppression of vital facts - Violation of IBC as amended, Corporate Insolvency Resolution Process or not - HELD THAT:- When any condition is mentioned in the plan and that condition is required to be fulfilled by the stakeholders after approval of the plan by the CoC, and accomplishment of the provisions of the plan is contingent upon some future actions after approval, then there could be a situation of uncertainty in future in fulfilling of the provisions of the plans, but here in this situation, since interlinking already been approved the Carval Plans alone being approved, nothing has remained contingent, the Resolution Applicant is under unconditional obligation to fulfil the provisions of the Plans, therefore there are no merit in the objection raised by Jatia Group.
Approval of the Carval Resolution Plan by CoC is in breach of proviso to Section 31(4) of the Code or not - HELD THAT:- In the cases of combination, the Adjudicating Authority is mandated to examine as to whether approval is obtained from CCI or not, if not approved, it will not be approved by the Adjudicating Authority. Moreover, in the proviso, it is not said that if approval of CCI is not obtained before CoC approved the plans; the plan approved by the CoC would amount to nullity. Above all, it is not that plans are without approval of CCI, the difference is -approvals are ex-post facto approvals, not ex-ante approvals. If this difference makes any difference to the rights of anybody, then these approvals shall be put to test as to whether post facto approval caused any grievance to any of the stakeholders. It is not the case that by virtue of this post facto approval, Jatia group rights are affected - CCI approval is in no way connected to the commercials CoC examines, since CCI is the Regulatory authority to avoid unhealthy competition in the market, CCI approval is mandatory to the approval of the plan, so that this infraction would not become hindrance if the plan is approved by CCI after CoC has approved. Here plans were approved by CCI.
Discrimination against Operational Creditor - HELD THAT:- If at all equitable treatment is set as a test to approve the Resolution Plan ignoring the provisions of the Code, it always differs from case to case and from person to person. It is only a perception. Perception is always dependent upon the mindset of the person dealing with it, which ultimately will become a threat to predictability and certainty. When the Code is clear as to how to go about, with all humility I hold that this test is beyond the scope of Sec. 53 r/w Section 30(2) of the Code, for this reason only the Honourable Supreme Court time and again reiterated that the Adjudicating Authority shall not enter into the aspects left to be decided by the CoC - As to maximisation of the assets of the Corporate Debtor and keeping the company as a going concern, it is the point to be decided by the CoC. Unless it is pointed out that the CoC examination is vitiated by fraud, the Adjudicating Authority is not expected to interfere with the decision of the CoC.
Deliberate suppression of vital facts - HELD THAT:- It appears the Resolution Application filed revised PBG so as to meet the requirements as mentioned in the format. It is not the case of the Noble counsel that PBG given by the Resolution Applicant is not proportionate to the value of the plan. At the end of the day, one has to see as to whether PBG equivalent to the requirement has been given or not, while approving plans, it is quite common, the Resolution Applicant offers something, when something offered is not in compliance of the requirement, CoC would ask for compliance, if the applicant fulfills the compliance, CoC would further proceed with the plan. In this case also, same thing happened. PBG is normally taken to bind the Resolution Applicant to fulfill the plan; it will not make any difference to quantum of payment and timings mentioned in the plans - there are no merit in the objections raised by Nobel. When the Operational Creditor they will only get their share as set out in the Code. It cannot be seen whether Operational Creditors are receiving money equivalent to the money Financial Creditors getting, because operational creditors as a class cannot equate themselves with the financial creditors and ask for more than what they are entitled u/s 53 r/w section 30(2) of the Code.
With regard to other objections, such as some financial creditors arising discussions in the CoC meeting with regard to the approval of the resolution plans, it is to be seen as to whether the Financial Creditors who raised queries in the meetings have voted in favor of the plan or against the plan and whether the approval is with requisite majority or not. If the approval is given with requisite majority, the discussions taken place in the meeting cannot invalidate the plans duly approved by the CoC.
There are no merit in the objections raised by Noble - the Resolution Plan approved by the CoC of Metallics and the Resolution Plan approved by the CoC of Value Steels are hereby approved.
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2020 (5) TMI 706
Seeking grant of regular bail - case of applicant is that he has neither been named in the FIR nor is there any allegation in the FIR nor any other material collected during investigation, that would identify the applicant as one of the perpetrators of the offences alleged - HELD THAT:- Prison is primarily for punishing convicts; not for detaining undertrials in order to send any 'message' to society. The remit of the court is to dispense justice in accordance with law, not to send messages to society. It is this sentiment, whereby the State demands that undertrials be kept in prison inordinately without any purpose, that leads to overcrowding of jails; and leaves undertrials with the inevitable impression that they are being punished even before trial and therefore being treated unfairly by the system. If at the end of a protracted trial, the prosecution is unable to bring home guilt, the State cannot give back to the accused the years of valuable life lost in prison. On the other hand, an accused would of course be made to undergo his sentence after it has been awarded, after trial.
This court also cannot but notice that the offences under section 147/148/149 IPC arise in the context of an 'unlawful assembly', which section 141 IPC defines as an assembly of 5 or more persons acting with unlawful purposes as defined in that provision; while in the present case only 2 persons appear to have been charged. Also, the offences under sections 147/148/149/427 IPC are in any case bailable offences; and only the offence under section 436 IPC is non-bailable; and there is no material to support that offence that can be said to be clinching or unquestionable, to say the least.
While ordinarily this court would not have entered upon any discussion on the evidence at the stage of considering bail, however here is a case where a purported unlawful assembly of some 250-300 persons is alleged to have committed offences; of which the police have picked-up only two, one of them being the applicant. In this peculiar circumstance, this court was compelled to sift the evidence only prima-facie and limited to cursorily assessing how the police have identified the applicant from that large assembly of persons. This court is conscious that 'judicial custody' is the custody of the court; and the court will be loathe to depriving a person of his liberty, in the court's name, on the mere ipse-dixit of the State, when it finds no substantial basis or reason for doing so.
Application disposed off.
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2020 (5) TMI 705
Maintainability of appeal on low tax effect - Assessee contended that the appeal filed by the Department is not maintainable in view of the Circular No. 17/2019 dt. 08/08/2019 issued by CBDT wherein the monetary limit for filing the appeals by the Department before the ITAT has been increased to ₹ 50,00,000/- from ₹ 20,00,000/-. - HELD THAT:- In the present case it is an admitted fact that the CBDT vide Circular No. 17/2019 enhanced the monetary limit to ₹ 50,00,000/- for not filing the appeal by the department before the ITAT, earlier this limit was specified at ₹ 20,00,000/- in the original Circular no. 03/2018 dt. 11/07/2018.
As earlier Circular no. 3 of 2018 dt. 11/07/2018 at page 5 has been removed and the limit specified in para 3 of the earlier Circular has been enhanced. It is also not in dispute that the earlier Circular was applicable retrospectively to the pending appeals / cross objections and para nos. 12 & 13 of the original Circular no. 03/2018 dt. 11/07/2018 - the amended Circular No. 17/2019 now issued by the CBDT is also applicable to the pending appeals as has been specified in para 13 of the original Circular no. 3/2018 dt. 11/07/2018 and that the Department ought not have filed the appeals before the ITAT where the tax effect is ₹ 50 Lacs or less - we hereby hold that the relaxation in monetary limits for departmental appeals, vide CBDT circular dated 8th August 2019 (supra) shall be applicable to the pending appeals in addition to the appeals to be filed henceforth. Revenue appeal dismissed.
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2020 (5) TMI 704
TP Adjustment to the transaction of software development services - exclusion of comparable namely M/s Infosys Ltd. - HELD THAT:- Respectfully, following the view taken by the Coordinate bench in assessment year 2008-09, we direct the Ld AO/TPO to exclude M/s Infosys Technologies Ltd. from the final set of the comparables. The ground No. 1 to 10 of the appeal of the assessee are accordingly allowed.
TDS u/s 195 - Disallowance of the export commission on account of non-deduction of the tax at source - disallowance u/s 40(a)(i) - AO concluded that there existed a business connection between G&D Egypt and G & D India - HELD THAT:-
We find that for having business connection in India the business operations carried out side India and inside India must have relationship as to contribute the business operations as a whole.
In the instant case, M/s GD Egypt is responsible for marketing and sales for assessee in the region of middle east and north Africa and has procured sales for the assessee. The business operation of the M/s GD Egypt of procuring sales order for the assessee and its entire activity has been carried out from outside India and no part of the business activity has been carried out in the India by M/s GD Egypt. The business connection has to be looked into the business operations of M/s GD Egypt in India and not business connection between the operation of the GD Egpyt and business of the assessee in India, because any workfor which the assessee is making payment will always be associated and part of the business of the assessee. Obviously, in the instant case no business connection exist and thus the finding of the learned DRP on the issue is set aside.
DRP has held that the services rendered by M/s GD Egypt require expertise and knowledge in the specific area of work and such expertise cannot be developed overnight, but it is the result of long period of the work in this line of activities coupled with accumulated experience of operations and therefore the payment made by the assessee to GD Egypt partakes the character of the FTS under domestic law.
In the instant case, the assessee has not invoked any Double Taxation Avoidance Agreement (DTAA) and therefore we are examining only the FTS under domestic law - As decided in M/S. EVERGREEN INTERNATIONAL LTD. [2018 (4) TMI 81 - ITAT DELHI] payment made for procuring of export sale order for Indian taxpayer by any foreign entities from outside India cannot be held as Fee for Technical Services.
In view of holding that payment for services of GD Egypt are not in the nature of Fee for Technical Services (FTS) , the other finding of the learned DRP of the applicability of explanation below section 9(2) i.e. there is no requirement of rendering services in India for income deemed to accrue or arise in India as per section 9(1)(vii) of the act, are rendered merely academic, and we are not required to examine applicability of the same in the year under consideration.
The payment made by the assessee is not chargeable under the provisions of the Act in the hands of GD Egypt, no tax is required to be deducted in terms of section 195 of the Act and consequently no disallowance could be made under section 40(a)(i) of the Act for non-deduction of the tax at source.- Decided in favour of assessee.
Disallowance of bad debt written off - HELD THAT:- No documentary evidence in support of the claim that income pertaining to such write off had been offered to tax as required under the provisions of the Act. In view of the above circumstances, we feel it appropriate to restore this issue back to the file of the learned Assessing Officer with the direction to the assessee to produce all necessary documents in support of its claim before the Assessing Officer, who then will decide the issue in accordance with law. It is needless to mention that the assessee shall be afforded adequate opportunity of being heard.
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2020 (5) TMI 703
Violation of Section 14 of the Insolvency and Bankruptcy Code, 2016 during the moratorium period by one of the Financial Creditors (Punjab National Bank) - Financial Creditors (Punjab National Bank) is holding voting share of 0.58% in the CoC - HELD THAT:- Upon perusing the material and documents placed before this Bench, it is seen that the Respondent-Financial Creditor (Punjab National Bank) admits that an amount of ₹ 1.87 crores lying in the CC account (as on 22.05.2019) was further debited for the LC payment; during the CIRP period, the Respondent-Bank issued fresh LC of ₹ 2,38,46,467/- on 01.06.2019 considering the urgency of business commitment of Corporate Debtor Company after obtaining approval from the IRP. It is pertinent to mention here that in the 4th CoC meeting held on 07.0 1.2020, the members from SBI (consortium of Banks) holding 32,59% voting share pointed out that the issue relates to accounting treatment, the amount as claimed by the Applicant/Corporate Debtor could be reversed with the approval of appropriate authority.
The Respondent-Bank has, in violation of the provisions under Section 14 of the IBC, unilaterally appropriated the amount due on LCs which is an amount distributable among all creditors after the conclusion of CIRP. (details of dates of LC and date if appropriate of the amount are given in Page.28 of the application). Further, no records could be found to ensure that the Respondent Bank has included the claim of LC in the outstanding credit prior to CIRP.
The Respondent-Bank (Punjab National Bank) is required to credit to the Corporate Debtor’s Account the amount of ₹ 17,95,04,271.79 (₹ 1,87,39,588.90 presently operated by the RP; ₹ 14,57,64,682,89 from the LC honored before CIRP and appropriated after CIRP and also GST refund of ₹ 1,50,000/- received during the CIRP period) which were meant to settle the liability on account of the LCs opened during pre-CIRP period.
Application is allowed to the extent of amounts debited to the Corporate Debtor’s account during the CIRP for having honored pre-CIRP LCs opened by the Corporate Debtor.
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2020 (5) TMI 702
Murder - two sadhus were brutally killed by a mob, allegedly in the presence of the police and forest guard personnel - offence under 153, 153A, 153B, 295A, 298, 500, 504 and 506 of the Indian Penal Code - HELD THAT:- The fundamental basis on which the jurisdiction of this Court has been invoked Under Article 32 is the filing of multiple FIRs and complaints in various States arising from the same cause of action. The cause of action was founded on a programme which was telecast on R Bharat on 21 April 2020. FIRs and criminal complaints were lodged against the Petitioner in the States of Maharashtra, Rajasthan, Madhya Pradesh, Telangana and Jharkhand besides the Union Territories of Jammu and Kashmir.
In the present case, all the FIRs or complaints which have been lodged in diverse jurisdictions arise out of one and the same incident-the broadcast by the Petitioner on 21 April 2020 on R Bharat. The broadcast is the foundation of the allegation that offences have been committed under the provisions of Sections 153, 153A, 153B, 295A, 298, 500, 504 and 506 of the Indian Penal Code - The manner in which the Petitioner has been subjected to numerous FIRs in several States, besides the Union Territories of Jammu and Kashmir on the basis of identical allegations arising out of the same television show would leave no manner of doubt that the intervention of this Court is necessary to protect the rights of the Petitioner as a citizen and as a journalist to fair treatment (guaranteed by Article 14) and the liberty to conduct an independent portrayal of views. In such a situation to require the Petitioner to approach the respective High Courts having jurisdiction for quashing would result into a multiplicity of proceedings and unnecessary harassment to the Petitioner, who is a journalist.
The transfer of an investigation to the CBI is not a matter of routine. The precedents of this Court emphasise that this is an "extraordinary power" to be used "sparingly" and "in exceptional circumstances" - The principle of law that emerges from the precedents of this Court is that the power to transfer an investigation must be used "sparingly" and only "in exceptional circumstances". In assessing the plea urged by the Petitioner that the investigation must be transferred to the CBI, we are guided by the parameters laid down by this Court for the exercise of that extraordinary power. It is necessary to address the grounds on which the Petitioner seeks a transfer of the investigation.
The contention of the Petitioner that the length of the investigation or the nature of the questions addressed to him and the CFO during the interrogation must weigh in transferring the investigation cannot be accepted. The investigating agency is entitled to determine the nature of the questions and the period of questioning - the allegation of the Petitioner that there is a conflict of interest arising out of the criticism by him of the alleged failure of the State government to adequately probe the incident at Palghar is not valid. The investigation of the Palghar incident is beyond the territorial jurisdiction of the Mumbai police.
The interview given by the complainant to a representative of R Bharat does not furnish a valid basis in law for an inference that the investigation is tainted or as warranting a transfer of investigation to the CBI. The Government of Maharashtra has moved an application before this Court (affirmed by the DCP, Zone-3) seeking appropriate directions to insulate the investigating agency "from any pressure, threat or coercion from the Petitioner" and to enable it to discharge its lawful duties in a fair and transparent manner - The investigating agency has placed on the record what it believes is an attempt by the Petitioner to discredit the investigation by taking recourse to the social media and by utilizing the news channels which he operates. Social media has become an overarching presence in society.
An individual under investigation has a legitimate expectation of a fair process which accords with law. The displeasure of an Accused person about the manner in which the investigation proceeds or an unsubstantiated allegation (as in the present case) of a conflict of interest against the police conducting the investigation must not derail the legitimate course of law and warrant the invocation of the extraordinary power of this Court to transfer an investigation to the CBI. Courts assume the extraordinary jurisdiction to transfer an investigation in exceptional situations to ensure that the sanctity of the administration of criminal justice is preserved - Petition disposed off.
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2020 (5) TMI 701
Seeking restoration of name of the company in the register of ROC - Section 252 of the Companies Act, 2013 - HELD THAT:- Upon perusal of the Income Tax acknowledgement which is filed along with the petition, would prove the fact that eventhough the Company has been active during the period under scrutiny filing returns with Income Tax, however had failed to file the same with the Respondent of any statutory retunes. Further from the documents submitted by the Appellant, it is evident upon its bare perusal which would prove that the company was not doing any business and remains to be dormant - after conscientious perusal of the documents filed by the Applicant Company, this Tribunal is satisfied that the Applicant Company is not carrying on its business during the time when the Company was struck off from the Register maintained by the Respondent and also no cogent reasons or any documents are produced before this Tribunal in order to substantiate that the Company was carrying on its business or it is just to revive/restore the name of the Company to the Register as maintained by the Respondent.
Application dismissed.
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2020 (5) TMI 700
Seeking direction to the Appellant-Bank to pay his lawful admitted claims in terms of agreement - seeking also to deposit the income-tax papers with immediate effect - HELD THAT:- The case set up by the Respondent No. 1 in the writ petition is neither an admitted position nor is it possible to even remotely suggest that it is indisputable, so as to bind the Appellant-Bank on that basis. Moreover, from the narration of facts, it is more than clear that it would involve scrutiny of complex matters and issues including about the existence of the very agreement, which is the foundational evidence for seeking relief as prayed in the writ petition. In that, the genuineness and existence of the stated agreement has been put in issue by the Appellant-Bank and which is made good on the basis of affidavits of concerned Bank officials and even supported by the report of the District Magistrate referred to in his affidavit dated 5.5.2016.
In the facts of the present case, the High Court should have been loath to entertain the writ petition filed by the Respondent No. 1 and should have relegated the Respondent No. 1 to appropriate remedy for adjudication of all contentious issues between the parties.
Appeal allowed.
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2020 (5) TMI 699
Seeking grant of bail - as per Section 12 of Juvenile Justice Act, 2015, the Board is not required to mechanically release a juvenile or grant him bail as a matter of course, merely because the accused before it is a juvenile - HELD THAT:- There is no reason or material to interfere with the finding recorded by the Board and affirmed by the appellate Court, holding that if the present petitioner – a child in conflict with law is released, there is every likelihood that he will mingle in the company of violators of law and prodded or prompted to commit similar offences - As per the scheme of the JJ Act, more particularly Section 12 thereof, a child in conflict with law is to be given benefit of bail. Such benefit can be denied only upon recording a finding that there appears reasonable belief that such release is likely to bring the person into association of any known criminal or expose him to more physical or psychological danger.
There is no gainsaying the fact that two more cases of like nature are pending against him. Considering the nature of allegation against the petitioner, the Board and appellate Court were justified in concluding that if he is handed over to the guardian or released on bail, he is likely to go in company or in association of known criminals and the same would expose him to crimes of like nature - It is more or less trite that in case charge-sheet is not filed within 60 days or 90 days, as the case may be, an accused is entitled for bail by virtue of first proviso to sub-section (2) of Section 167 the Code.
The government has come out with the taxation and other laws (Relaxation of Certain Provision) Ordinance, 2020. By virtue of the provisions contained in this Ordinance, the limitation or outer limit for compliance or actions/orders under various enactments has been extended. Concededly, no amendment has been introduced in the Code, particularly in Section 167(2) - In absence of any amendment in the statute and without there being any remote reference of investigation or provisions of the Code in the order of Supreme Court, taking shield of the Supreme Court’s order to take away the vested right of an accused, is nothing short of violating his right of liberty guaranteed under Article 21 of the Constitution.
It is directed that the petitioner – Pankaj S/o Late Lalshankar Meena shall be released on bail on furnishing a personal bond by his natural guardian Ramesh S/o Dhanji Meena (Uncle) in the sum of ₹ 50,000/- and two sureties of ₹ 25,000/- each to the satisfaction of the Juvenile Justice Board, Udaipur with the stipulation that on all subsequent dates of hearing he shall produce the petitioner before the said Board or any other Court during pendency of the inquiry in the case and that his guardian shall keep proper look after of the petitioner and keep him away from the company of known criminals - revision allowed.
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2020 (5) TMI 698
Seeking grant of Bail - time limitation - due to lockdown imposed consequent to SARS COVID 19 Pandemic, the investigating officer was not in a position to submit the final report within the statutory period - HELD THAT:- Coming to the object and scope of Section 167 it is well settled that it is supplementary to Section 57 of the Code. Section 57 of the Code provides that the investigation should be completed in the first instance within 24 hours; if not the arrested person should be brought by the police before a Magistrate as provided under Section 167. Such Magistrate may or may not have jurisdiction to try the case. The Judicial Magistrate can in the first instance authorise the detention of the accused in such custody, i.e. either police or judicial from time to time but the total period of detention cannot exceed fifteen days in the whole. Within this period of fifteen days there can be more than one order changing the nature of such custody either from police to judicial or vice-versa.
The significance of the period of 60 days or 90 days, as the case may be , is that if the investigation is not completed within that period then the accused, who is in custody, is entitled to “default bail” if no charge-sheet or challan is filed on the 60th or 90th day as the case may be, subject of course, to the condition that the accused applies for “default bail” and is prepared to and does furnish bail for release.
In the case on hand, the petitioner herein was remanded to judicial custody on 17.1.2020. The period of 90 days had expired on 16.4.2020. His bail application was taken up for consideration by the learned Special Judge on 6.5.2020. It is clear from the order that even on that day, the final report had not been submitted before the jurisdictional court. In the light of the above settled precedents, the petitioner has to be held entitled to the grant of default bail. The situation would not change even if after the dismissal of the application by the Special Judge, the final report was laid.
Whether the period for submitting the final report can be taken to be extended as contended by the learned Public Prosecutor? - HELD THAT:- If Section 167 of the Cr.P.C. is analysed, it is luculent that the said provision does not provide any outer limit for the period of completion of investigation. It only interdicts the Magistrate from authorising detention of the accused person other than in the custody of the police for the statutory period. However, the police can continue with the investigation and take their own sweet time to conclude the same and file a final report. This provision is unlike Section 468 of the Cr.P.C., which provides for limitations for taking cognizance of certain offences - Right of personal liberty is not only a legal right but it is a human right which is inherent in every citizen of any civilized society. Article 21 only recognizes this right. Section 57 and 167 are the provisions in the Code which provides for procedure established by law which curtails this right. Such provisions which provide for the procedure to keep an accused under prolonged incarceration will have to be interpreted keeping in mind the constitutional rights of the accused.
Default bail is granted to the petitioner - petitioner shall be released on bail on his executing a bond for ₹ 50,000/- with two solvent sureties each for the like sum to the satisfaction of the court having jurisdiction - application allowed.
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2020 (5) TMI 697
Grant of Default Bail - denial of bail relying on the decision in IN RE : COGNIZANCE FOR EXTENSION OF LIMITATION [2020 (5) TMI 418 - SC ORDER] - Extension of period of limitation prescribed under the general law or Special Laws - prevailing Covid-19 Virus pandemic situation in India - HELD THAT:- On 06.05.2020, the Hon’ble Supreme Court had passed an Order in the very same Suo Motu Writ Petition IN RE : COGNIZANCE FOR EXTENSION OF LIMITATION [2020 (5) TMI 418 - SC ORDER] and extended the limitation period for statutory provisions under Section 138 of the Negotiable Instruments Act and the Arbitration and Conciliation Act with effect from March 15, 2020 till further order - The Hon’ble Supreme Court has not mentioned in the said Orders that investigation will be covered under these Orders. The Orders of the Hon’ble Supreme Court are binding on all the courts including High Courts. No court has the right to interpret the Orders passed by the Hon’ble Apex Court. Therefore, the police investigation is not covered under the Orders of the Hon’ble Supreme Court.
Personal liberty of the individual, guaranteed under Article 21 of the Constitution of India, is very precious fundamental right and it should be curtailed only according to law - It is admitted fact between the parties that the investigation is going on and the applicant is in judicial custody since 23.01.2020.
This Court is of the view that the applicant is entitled for default bail - let the applicant be released on bail on his executing a personal bond and furnishing two reliable sureties, each in the like amount, to the satisfaction of the court concerned subject to the conditions imposed.
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2020 (5) TMI 696
Seeking to incorporate directions in the SOP for jails for the purpose of the present COVID pandemic - HELD THAT:- For ascertaining whether the directions/suggestions are being complied with or not and to what extent, we direct the committees to be formed consisting of the (i) Secretary, DLSA or TLSA, (ii) CMHO and/or its representative and (iii) President or Secretary of the local Bar Association. This team shall visit each jail within their respective districts, Central Jail/District Jail/ Sub Jail and they shall check and verify the status of each jail vis-a-vis parameters set up by the Union of India, the State of Rajasthan as well as in the publication made by the RSLSA, in particular all suggestions regarding public health within the jail premises. Such committees formed for each jail i.e. Central Jail, District Jail and/or Sub Jail, shall visit in their respective districts/Sub Division and reports by them regarding status, shall be submitted before the Member Secretary, RSLSA on or before 22.05.2020.
The Member Secretary, RSLSA and Ms. Smita Chakraborty are requested to collate all such reports and present the same in a concise manner with their suggestions, if any, before this Court by 26.05.2020 with copies to the learned Advocate General, Additional Chief Secretary (Home) and Director General (Prisons), Rajasthan - The matter shall be next listed on 27.05.2020.
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2020 (5) TMI 695
Estimation of income - Bogus purchases - CIT(A) has sustained the addition made by the AO on estimating @ 16% of the alleged bogus purchases - HELD THAT:- ITAT Mumbai Bench in the case of Heeramaneck & Son [2018 (12) TMI 1830 - ITAT MUMBAI] complete onus to prove the purchases conclusively was on assessee, which has remained un-discharged. In such a scenario, the addition, which could be made, was to account for profit element embedded in these purchase transactions to factorize for profit element earned by assessee against possible purchase of material in the grey market and undue benefit of VAT against alleged bogus purchases, which lower authorities have rightly done. However, considering GP rate of 10.59% already reflected by the assessee as well as VAT rate applicable to the goods being dealt with by the assessee, we find the estimation to be on the higher side and therefore, we restrict the same to 3% of alleged bogus purchases.
Thus as assessee has already declared GP ratio from the purchases made from Om Corporation and others respectively. We notice from the financial statement that assessee has declared GP of 15.60% and we do not know how much GP, assessee has earned out of the disputed purchases. Therefore, we are inclined to direct the AO to estimate the income @ 3% of the alleged purchases. Accordingly, we direct the AO to estimate the income of the assessee @ 3% of the alleged purchases. - Decided partly in favour of assessee.
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