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Showing 401 to 420 of 848 Records
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2010 (10) TMI 805
Change of opinion - power of reassessment - Income escaping assessment by initiating proceedings under s. 147 of the IT Act - addition on account of capital gains - Under the old provisions of s. 147, separate cls. (a) and (b) laid down the circumstances under which income escaping assessment for the past assessment years could be assessed or reassessed. To confer jurisdiction under s. 147(a) two conditions were required to be satisfied : firstly the AO must have reason to believe that income, profits or gains chargeable to income-tax have escaped assessment, and secondly he must also have reason to believe that such escapement has occurred by reason of either omission or failure on the part of the assessee to disclose fully or truly all material facts necessary for his assessment of that year. Both these conditions were conditions precedent to be satisfied before the AO could have jurisdiction to issue notice under s. 148 r/w s. 147(a). But under the substituted s. 147 existence of only the first condition suffices. In other words if the AO for whatever reason has reason to believe that income has escaped assessment it confers jurisdiction to reopen the assessment. It is, however, to be noted that both the conditions must be fulfilled if the case falls within the ambit of the proviso to s. 147. The case at hand is covered by the main provision and not the proviso – Held that:- we allow this appeal, set aside the impugned order of the Tribunal and remit the matter to the Tribunal for fresh decision on merits in accordance with law
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2010 (10) TMI 803
Notice u/s 148 - Petitioner let out its plant and machinery and treated the income received to be 'business income - claimed deductions on the account of business expenses - Assessing Officer noticed that income of the assessee being from house property, business expenses could not be allowed to be deducted therefrom – Held that:- Reference may be made to CIT v. Rajesh Jhaveri (2007 -TMI - 6563 - SUPREME Court) noticing the scheme of law after 1.4.1989. The judgments relied upon do not deal with the case of reassessment after processing and are, thus, distinguishable. Plea of reassessment being illegal, when no satisfactory assessment was earlier made, cannot be accepted on the ground that the same was based on mere change of opinion
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2010 (10) TMI 802
Unexplained investment - unrecorded sales - figure of sale shown by the assessee was in excess of figure of material recorded in the books of account. Thus, income declared was more than the figure of material recorded in record. Even if there may be deficiencies in the books of account, which may give rise to suspicion for making addition, inference has to be justified on same basis. When the sale figure was higher than the figure of raw material recorded in the books of account or inferred, the CIT(A) and the Tribunal could certainly hold the addition to be unjustified. The findings recorded are based on appreciation of evidence and are not shown to be perverse, no substantial question of law arises for consideration, appeal is dismissed.
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2010 (10) TMI 801
Service tax under Banking and other Financial Services - appellants branches were not registered for payment of service tax under the category of business auxiliary services though they were providing the said services – Held that:- export of service may take place even when all the relevant activities take place in India so long as the benefits of these services accrue outside India. It is an admitted fact that the benefits of the services rendered by the appellant are accrued to a person who is situated outside India and to Western Union, who is also situated outside India, Accordingly, in view of the detailed order given by this Bench in the case of Muthoot Fincorp Ltd. (2009 -TMI - 75389 - CESTAT, BANGALORE) and facts in the current case being identical as in that case, the impugned order is liable to be set aside and we do so. The impugned order is set aside and appeal is allowed
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2010 (10) TMI 800
Gold - an asset belonging to the assessee on the relevant valuation date and the value includible in the net wealth of the assessee – Held that:- 66 kgs. of gold has not been returned to the assessee nor the same could be recovered by the police. No proceedings for recovery of the said gold are pending. The assessee's claim to get back the gold also stands barred by the law of limitation. Keeping all these facts in view, we find ample force in the contention of the assessee that the said gold stands lost. For including the value of an asset in the net wealth of the assessee, the asset must be in existence on the relevant valuation date. Since that gold was not in existence on the relevant valuation date, its value, in our opinion, is not includible in the assessee's net wealth, no flaw in the aforesaid reasoning and there is no reason to take a different view when for other assessment period the above finding has become final. Thus, we hold that this 66 kgs. of gold cannot be held to be an asset on the relevant valuation date and its value is not includible in the net wealth of assessee, it is also held that 123 kgs. of gold (57 kgs. + 66 kgs.) was not an asset belonging to the assessee and value thereof is not includible in the net wealth of assessee. The question Nos. (1) and (4) are accordingly answered in favour of the assessee Silver - an asset belonging to the assessee on the relevant valuation date and its value is to be included in the net wealth of the assessee - deduction for the sum of Rs. 25 lakhs being the penalty imposed for contravention of the Gold Control Rules and remaining unpaid on the relevant valuation date - Tribunal directed the AO to include 50 per cent of the value of silver as determined by him in the assessment orders in the net wealth of the assessee – Held that:- WTO had made heavy addition on account of valuation of the silver bullion in question. The CWT(A) held that the silver bullion during the period was not an asset of the assessee, therefore, adopted nil value of the said asset. The Tribunal held that silver bullion in question was an asset of the appellant but the Tribunal because of the heavy addition accepted the contention of counsel for the assessee and took the discounted value of the silver bullion and directed the WTO to add 50 per cent of the additions adopted by him in the assessment order. We find substance in the argument of the counsel for the assessee that since the silver bullion was seized and it was not available to the assessee for use for such a long period of time, therefore, discounted value has rightly been adopted. The counsel for the respondent-Revenue could not point out as to what was wrong in adopting the discounted value of the silver bullion in the peculiar facts of the present case. Thus, this question is answered in favour of the assessee and against the Revenue
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2010 (10) TMI 799
Cenvat credit - Modvat credit was denied to the assessee by the Joint Commissioner and confirmed by the Commissioner (Appeals) only on the basis of information furnished by the Superintendent, Central Office to the effect that the supplier did not submit the subject invoices along with their monthly return and details of the goods received and sold were not entered in RG 23D Register - Held that:- there is no dispute regarding duty payment and use of goods in manufacture of final product and the credit has been denied only on the ground that necessary particulars were not mentioned in the invoices and the supplier, which issued those invoices, did not enter the particulars in their statutory records. The appeal has been allowed in view of the amendment made in Rule 57G and the Board's Circular, which was issued in light of the amended rules, no illegality, infirmity or jurisdictional error committed by the Tribunal while passing the impugned order. We answer the substantial questions of law in favour of the assessee and against the Revenue, and dismiss the appeal accordingly.
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2010 (10) TMI 796
Addition under s. 68 of the IT Act - unsecured loan - quantum of amount of Rs. 24,86,866 found to have been borrowed from eight different creditors by way of 'unsecured loan' to the tune of Rs. 3,25,000 each from two creditors, Rs. 3,00,000 from one creditor, Rs. 1,00,000 each from four creditors and Rs. 11,36,866 from one creditor. Maximum amount that has been borrowed by assessee, was Rs. 11,36,866 from Shri K.K. Sharma, director of the company - Held that:- confirmations given by those creditors and observed that there was no reason to doubt correctness of the claimed cash credit amounting to Rs. 24,86,866 taken from the above named creditors, Appeal being devoid of merit is accordingly dismissed in limine
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2010 (10) TMI 795
Addition to the returned income on account of amount received as loan which was treated to be receipt within the meaning of s. 56(2)(v) of the Act - Held that:- amount contemplated under s. 56(2)(v) of the Act cannot include loan which is shown to have been repaid, the amount received was a short-term loan which was duly repaid. The said amount cannot be treated as income of the assessee under s. 56(2)(v) of the Act. appeal is consequently dismissed.
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2010 (10) TMI 792
Whether an assessee engaged in rendering services of repairs and maintenance to its customers having utilized various articles for providing effective repairs and maintenance would be entitled to avail the benefit of the Notification No. 12/2003-S.T., dated 20-6-2003 in relation to such articles - decision of the Tribunal in the matter of Agrawal Colour Advance Photo System v. CCE (2010 -TMI - 77640 - CESTAT, NEW DELHI) wherein similar issue had arisen and/has been sought to be referred for decision by a Larger Bench, in the view what is stated above and particularly taking into consideration the divergent views expressed by different Benches of the Tribunal and the Courts on the point in issue and the reference sought to be made in relation to the said issue to the Larger Bench, it would be appropriate to refer the said issue to the Larger Bench in this case also, Registry is therefore directed to place the matter before the Hon'ble President for necessary order for reference of the matter to the Larger Bench on the above issue
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2010 (10) TMI 789
Deductions available under Sec. 80HHC - Whether the Tribunal was correct in holding that the relief U/s 80HHC of the Act should be allowed before adjusting the brought forward loss and unabsorbed depreciation of the earlier year from the total income - Held that:- While making the fresh assessment, assessing authority shall also take into consideration that when the respondent assessee has more than one unit, it has to take into consideration which of the units can claim benefit under section 80HHC. The income of all the four units i.e., the total business has to be taken into account while considering the losses while allowing the claim of deducting unabsorbed loss and unabsorbed depreciation of the previous years, appeal ITA No.1007/2008 is disposed of setting aside the orders of the three authorities by remitting back the matter to the assessing authority
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2010 (10) TMI 788
Whether the welding electrodes used for fabrication or installation of capital goods which are further used for manufacture of final product, qualify as input or capital goods or not – Penalty – Held that:- It is no doubt that the appellants are entitled for availment of Cenvat credit on welding electrodes which have been used for fabrication/installation of the plant and machinery which are capital goods as per Rule 2(k) of Cenvat Credit Rules, 2004, Explanation 2, as held by the Hon'ble High Court of Rajasthan in the case of Hindustan Zinc Ltd. (2008 -TMI - 30617 - HIGH COURT RAJASTHAN) but the appellants are not entitled for the Cenvat credit on welding electrodes which are used for fabrication of structural supports to the machinery as held by the Larger Bench of this Tribunal in the case of Vandana Global (2010 -TMI - 76147 - CESTAT, NEW DELHI (LB)) wherein it was held that structures do not qualify as capita goods. Hence the demand on welding electrodes which are being used for fabrication of supporting structures is confirmed and the demand on welding electrodes used for fabricating of plant and machinery is dropped, penalty is not leviable in these cases. Accordingly, the penalties are not liable to be imposed, interest is leviable for delayed payment as held by the Hon'ble Supreme Court in the case of SKF Ltd. - Accordingly, the appellants are liable for payment of interest on demand confirmed for the use of welding electrodes for fabrication of supporting structures, matter remanded back to the original authority to quantify the demand as discussed above and the appeals of the Revenue are disposed of holding that interest is payable but penalty is not leviable, all the four appeals are disposed of
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2010 (10) TMI 784
Business income Vs. Capital gain - Assessee had shown income under the head 'short term capital gains' amounting to Rs.7,112/- and long term capital loss of Rs.11,15,745/- which has been carried forward for adjustment against future long term capital gains - e neither the Assessing Officer nor the Ld. Departmental Representative of the revenue could bring anything on record to show that the assessee was engaged in the business of purchase and sale of shares on regular basis and hence merely because as per the object clause of the Memorandum of Association, the assessee can deal in shares, it cannot be held that any transaction by the assessee for purchase of shares or for sale of shares, purchased in earlier years is a business transaction. Regarding disallowance u/s 14A - Rule 8D - Rule 8D was not applicable for the concerned year. For that proposition he relied upon the Hon'ble Mumbai High Court decision in the case of Godrej Boyce Mfg. Co. Ltd. vs. DCIT (2010 (8) TMI 77 - BOMBAY HIGH COURT). In this case it was held that Rule 8 D has been notified on 24.3.2008 and will be applicable only from Assessment year 2008-09.
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2010 (10) TMI 783
Contravention of provisions of section 68 of the Finance Act - Penalty for contravention of any provision for which no penalty is provided - Whoever contravenes any of the provisions of this Chapter or any rule made thereunder for which no penalty is separately provided in this Chapter shall be liable to a penalty which may extend to any amount not exceeding one thousand rupees - Held that:- penalty under section 77 may be extended to the amount not exceeding Rs. 1,000 thus the maximum penalty can be Rs. 1,000 but there is no restriction for minimum penalty and the lower appellate authority has rightly reduced the penalty from Rs. 6,000 to Rs. 3,000 in the instant case. no reason to interfere with the impugned order same is upheld, Appeal filed by the revenue is rejected
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2010 (10) TMI 782
Unaccounted sales - Assessing Officer has made addition by applying rate of 14.25 per cent. to the estimated unaccounted sales, appellant carried out unaccounted sales of knitted fabric is confirmed by the Central Excise Department - appellant carrying out such sales outside the books of account is undisputed facts not controverted even during the appeal proceedings – Held that:- As the profit on the sales of Rs. 45,19,63,026 and which came to Rs. 1,92,98,200 has already been considered as income of the appellant, the sales whatsoever, which have not been accounted for in the sales considered in the audited accounts filed with the return of income are taken to be covered in the sales reflected in the balance-sheet with the Registrar of Companies. Once the income of the appellant had been held to be assessable at Rs. 1,92,822,200 as against that of Rs. 9,984 shown in the return of income, the addition of Rs. 53,58,618 with all fairness should be taken to have been covered in the above addition. As such, there is no need to make separate addition of Rs. 52,58,618 and this addition accordingly deleted, appellant is unable to dispute the correctness of concurrent finding recorded by the Commissioner of Income-tax (Appeals) and the Tribunal that the alleged unaccounted sales which were made the basis for addition to the income of the assessee, were already covered by income declared by the assessee, no substantial question of law arises, appeal is dismissed.
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2010 (10) TMI 781
SCN - appellate authority cannot go beyond the allegations raised in the show-cause notice, a new case cannot be made out in an appeal stage, order is liable to be set aside and remanded back to the ld. Commissioner (Appeals), order set aside and the matter is remanded back to the ld. Commissioner (Appeals), to reconsider the issue after following the principles of natural justice, to decide the issue within the allegations made in the show-cause notice and findings recorded by the Adjudicating Authority and the grounds of appeal. The appeal is allowed by way of remand.
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2010 (10) TMI 780
Duty demand – Cenvat credit - demand has got enhanced to the extent of Cenvat credit available in their book - original adjudicating authority rejected the claim that the appellant has Cenvat credit available in the order. He also did not accept the claim made by the appellant that amount of Cenvat credit already debited should be appropriated towards amount payable by them - Commissioner (Appeals) has taken a view that the debit of Cenvat credit made by the appellant has to be accepted by the department in view of the fact that the same has not been challenged and according to the law, in the self assessment procedure, the assessee is free to utilize the credit and if the department has any problem, department can take action. Having failed to take any action or in the absence of any evidence for such action, the Commissioner (Appeals) can be said to have held that reversal of Cenvat credit made by the appellant has to be taken as payment towards service tax and other dues confirmed against the appellant – Held that:- Amount paid by the appellant is to be taken as amount paid towards dues, appeal is allowed with consequential relief
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2010 (10) TMI 778
Service tax along with interest has been demanded – works contract - appellants were engaged in providing services of construction of residential complex and failed to discharge service tax liability - in the impugned order Commissioner (Appeals) in Para 10 has observed that irrespective of the works contract between service provider and the service receiver, the nature of services provided was leviable to service tax as per the definition of ‘construction of complex’ given in the Finance Act – Held that:- issue involved is complex and requires consideration of definition of construction services, various decisions of Tribunals/Courts and also liability of the appellants during different period. Further, it is also noticed that there are a number of contracts and therefore, the issue is contentious and arguable. In view of the observation of Commissioner (Appeals) that the nature of work is works contract and even then service tax is to be charged, the decisions cited by the learned advocate regarding liability of service tax on works contract prior to 1-6-2007 are relevant and would show prima facie case has been made out by the appellants, requirement of pre-deposit is waived and stay against recovery of service tax, interest and penalties is granted during the pendency of appeal
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2010 (10) TMI 777
CENVAT credit of Service Tax paid on Pandal & Shamyana Services and Insurance Services for discharging their duty liability, even if, they are not at all or remotely connected with the generation of Steam or electricity or manufacture of final products - Held that:- Tribunal has already decided the above issue in favour of the assessee and against the revenue, the question on which the appeal has been admitted is a question of fact which has been finally decided by the Tribunal in favour of the assessee, appeal dismissed.
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2010 (10) TMI 776
Appeal dismissed by the ITAT since the appellant was absent - power and obligation of tribunal - held that:- Even if the appellant was absent when the DR was present, the Tribunal was required to proceed with the matters on merits with the available material on record. appeals were dismissed for want of prosecution much against the procedure. Under these circumstances, the Tribunal has to dispose of the Miscellaneous Petition Nos. 112-116/2009 after taking into consideration whether the notice was served or not on the appellant/assessee and whether DR was present or not and then to proceed with the matter, appeals are allowed setting aside the order of dismissal and the matter is remitted back to the Tribunal to dispose of the matters in the light of the above observations after giving opportunity to both the parties
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2010 (10) TMI 772
Depreciation - AO found that assessee has claimed depreciation of Rs. 12,79,784/- while computing profits for deduction under section 80IB whereas according to the AO such amount works out to Rs. 9,34,071 - Section 80IA contains both substantive and procedural provisions for computing such special deduction and any device adopted to reduce or inflate the profits of eligible business has to be rejected - The claim of higher depreciation or lower depreciation may not ultimately affect the tax liability of the assessee as whatever profit is derived after deducting depreciation would be eligible for 100% deduction under section 80IB - Therefore, such finally assessed income could not be disturbed by considering notionally allowable depreciation and then work out WDV for the current year - Decided against the assessee Deduction u/s 80IA - According to the AO, majority of the expenditure written off are of capital in nature - In other words any tax under section 41(1) will not be eligible for deduction under section 80IA - If such deduction was claimed and allowed in any earlier year then clearly there was reduction of profit in those earlier years and once the creditors remit the liability or liability ceased to exist and assessee declared it as part of the profit then nexus of such profit written back with the industrial undertaking is not severed - The deduction under section 80IA or 80IB is available on profits and gains computed in accordance with section 20A- 43D which includes section 41(1) also - Accordingly this ground of assessee is allowed for statistical purposes The ld. AO disallowed the claim of sum of Rs. 3,10,000/- by holding that it is not derived from business or industrial undertaking - Thus like interest receipt of FDR insurance claims also cannot be said to be derived from business of industrial undertaking and thus they are not eligible for deduction under section 80IA - In the result, appeal filed by the assessee is partly allowed but for statistical purposes
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