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Showing 401 to 420 of 1478 Records
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2016 (3) TMI 1085
Eligibility of deduction u/s.80 IB (10) - whether deduction was allowable if the profits were derived from the business of developing and construction of residential unit, that there was no requirement in the provision that the assessee carrying on the said business should also on the plot of land? - Held that:- As decided in case of Radhe Developers [2011 (12) TMI 248 - GUJARAT HIGH COURT ] The provisions nowhere require that only those developers who themselves own the land would receive the deduction u/s.80-IB(10) of the Act. Neither the provisions of section 80-IB nor any other provisions contained in other related statutes demonstrate that ownership of the land would be a condition precedent for developing the housing project. Such requirement cannot be read into the statute because there is nothing in section 80-IB(10) of the Act requiring that ownership of the land must vest in the developer for him to be able to qualify for such deduction. Moreover, the term “developer” has been understood in common parlance as well as in the legal sense as carrying a much wider connotation.
It is well settled that while interpreting a statute, particularly, a taxing statute, nothing can be read into the provisions which has not been provided by the Legislature. A condition which is not made part of section 80-IB(10) of the Act, namely, that of owning the land which the assessee develops, cannot be supplied by any purported legislative intent.
Respectfully following the above, we decide the effective ground of appeal against the revenue.
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2016 (3) TMI 1084
Penalty u/s 271D / 271E - Issue of limitation by invoking “Rule 27” of ITAT Rules - period of limitation prescribed u/s 275(1)( c) - Held that:- all the impugned orders levying penalty are barred by Limitation. The penalty order should have been passed not later than 30th June, 2012. As the impugned order is passed beyond this date, all the appeals are barred by Limitation. Hence all the Revenue appeals are dismissed. - Decided in favour of assessee
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2016 (3) TMI 1083
Approval under section 10(23C)(vi) rejected - Held that:- The provisions of section 10(23C)(vi) of the Act is quite clear to the fact that the only reason for denial of said exemption can be the case where the officer is not satisfied as to the genuineness of the activities of the assessee. By not applying the provisions of the Right to Education Act, it cannot be said that the assessee is not doing any genuine educational activities. For non-compliance of Right to Education Act, there is a specific appropriate authority which may take action against the assessee. Otherwise also, as stated by us earlier, the RTE provisions are not applicable to the assessee being an unaided society. It is not open to the Income Tax Department to take any such step. There may be some provisions in the relevant Act for the consequences of such non-compliance but it can certainly not be in the form of not granting approval to the assessee under the Income Tax Act.
Since the Principal Chief Commissioner of Income Tax has not doubted the genuineness of the activities of the society, we hereby direct him to grant registration under section 10(23C) of the Act. - Decided in favour of assessee.
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2016 (3) TMI 1082
Legal services - levy of service tax on senior Advocates - Notification No.9/2016-ST, Notification No.18/2016-ST and Notification No.19/2016-ST - Gujarat High Court granted the ad-interim relief as per the paragraph no.19(C) of the application.
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2016 (3) TMI 1081
Seeking de-sealing of business premises - Invokation of powers under Section 60 of the DVAT Act - Held that:-similar oredrs have already been held to be illegal by this Court in several cases. Accordingly the order dated 1st March 2016, the notice under Section 59 (2) of the DVAT Act and the actions taken and orders by the DT&T pursuant thereto are hereby set aside. The business premises of the petitioner be directed to be de-sealed forthwith.
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2016 (3) TMI 1080
Refund seeked - Held that:- As the Petitioner informs the Court that the Assessing Officer (‘AO’) has issued a draft assessment order for the AY 2014-15 making an addition of ₹ 3 crores to the total income of the Assessee. It is stated that since the Petitioner is keen on having the refund issued, it proposes to challenge the final assessment order before the Commissioner of Income Tax (Appeals) and would be making a statement to that effect before the AO by the Petitioner to enable the AO to issue the final assessment order.
Learned Senior Standing counsel for the Department, states that if a statement to the above effect is made by the Petitioner before the AO then the final assessment order will be passed soon thereafter and the refund issued not later than 30 days after the passing of the final assessment order.
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2016 (3) TMI 1079
Time for issuing notice under Section 143(2) - Time extension - Held that:- The time stipulated by the High Court for completing the assessments, as directed by the High Court, for the years for which notices under Section 143(2) of the Income Tax Act, 1961 have already been issued, is extended by a month from today.
Needless to say that in case the time for issuing notice under Section 143(2) of the Act has not expired, it will be open for the Revenue to decide whether notice should be issued at all.
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2016 (3) TMI 1078
Denial of refunds where scrutiny proceedings have been initiated - Held that:- The Court today has been shown a copy of the communication dated 19th February 2016 addressed to the Petitioner by the Assistant Commissioner of Income Tax – Centralized Processing Center (‘CPC’) Bangalore confirming that the Petitioner’s return for AY 2015-16 has been processed. It is stated that the Petitioner has agreed for the adjustment proposed of ₹ 1.94 crore (Rs. 1.76 crore for AY 2008-09 and ₹ 0.17 crore for AY 2011-12) through the on-line option.
Considering that the Petitioner has already been communicated the order of processing of return on 19th February 2016, the Court directs that the refund be issued for AY 2015-16 not later than 28th March 2016.
As far as AY 2012-13 is concerned, the deadline of finalization of the assessment order expires on 31st March 2016. The Petitioner has already informed the Assessing Officer (AO) that the Petitioner will be filing an appeal before the Commissioner of Income Tax (Appeals) in the event the assessment order is adverse to it. It is accordingly directed that the refund in respect of AY 2012-13 shall be issued to the Petitioner without unnecessary delay and in any event not later than 10th April 2016. To consider the main issue urged in the writ petition, list for hearing on 11th May 2016.
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2016 (3) TMI 1077
Unexplained cash credit u/s 68 - Held that:- CIT(A) granted relief to the assessee by observing that the assessee had explained the sources to be out of cash withdrawn by the partners from their bank accounts and out of regular cash in hand. The said contention of the assessee was supported by copies of partner’s bank pass book and also cash book as maintained by them in regular course of business. The ld. CIT(A) further observed that the assessee has successfully demonstrated the source of each and every amount credited in the capital account of the three partners. The explanation of the assessee is fully supported by documents placed in the paper book in the form of bank pass book, extracts from the regular books of accounts of respective partners and the financial statements of the partners. Therefore, the ld. CIT(A) was quite justified in directing the AO to delete the addition - Decided against revenue
Addition on account of unexplained credit in the capital contribution of the assessee firm - Held that:- In the present case we find no infirmity in the order of the ld. CIT(A) wherein he has categorically held that sufficient stock of ready and dyed fabric was actually available with the parent firm M/s Nath International out of which 1,89,517 meters of stock was withdrawn by the partners and was introduced as their capital contribution in the assessee firm. The ld. CIT(A) further held that the findings of the AO that no such stock were available with the said firm is factually incorrect and in view of the above facts noted by the ld. CIT(A) the addition made by the AO cannot be held as sustainable - Decided against revenue
Disallowance of rent paid - assessing officer held that the rent paid by the respondent for 4 rental premises out of 7 rental premises occupied by the respondent during the relevant assessment year is not genuine - Held that:- AO mixed two different types of information and wrongly interpreted them and arrived at the conclusion arbitrarily without giving the assessee any opportunity of being heard. From the written submissions of the assessee before the authorities below, it is amply clear that ht property situated at A-1, Sector 26, Noida was used for activities, the property situated at B-114, Sector 5, Noida and Kanodia House, Lohai Road, Farrukabad were used for production activities and the property at 504A, Nagarjuna Apartments, Mayur Vihar – 1, New Delhi was used for office of the assessee and all four disputed rent was paid for the purpose of the business of the assessee. These facts have not been controverted by the AO as well as by the ld. Sr. DR. Hence, the conclusion of the ld. CIT(A) is sustainable. When the assessee had provided detailed usage of premises, we are unable to see any valid reason to interfere with the conclusion of the first appellate authority and thus we uphold the same - Decided against revenue
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2016 (3) TMI 1076
Entitlement to depreciation - whether the production of readymix concrete amounts to manufacture and hence the assessee would be entitled for deprecation as claimed in respect of the machinery used? - Held that:- It is common knowledge that an uneducated mason does the work of preparation of readymix concrete for construction of houses and it is never treated as manufacturing activity either in the common parlance or in the commercial parlance. The readymix concrete can be produced in huge volume with the help of machines with less manpower but merely because there is increase in volume, it cannot automatically be treated as manufacturing activity. At any rate, the end product is only an intermediate product which is used for construction of buildings, roads, dams etc. and when the end product is not considered as manufacturing activity, then it is difficult to hold that the intermediate product can be classified as manufacture or production of article or thing.
Having regard to the ratio laid down by the Hon’ble Apex Court in the case of N.C. Budharaja & Co [1993 (9) TMI 6 - SUPREME Court ], bearing in mind the fact that the end product should amount to manufacture or production of an article or thing, the readymix concrete manufactured by the assessee, which is also engaged in the construction activity, cannot be said to be a manufacturing activity.
Therefore, answer the question in the negative and in favour of the Revenue by holding that the assessee is not entitled for additional depreciation in respect of machinery used since production of readymix concrete would not amount to manufacture of article or thing. - Decided against assessee
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2016 (3) TMI 1075
TDS u/s 195 - Disallowance u/s 40(a)(ia) - non-deduction of tax at source on payments of commission to non-resident sales agents - Held that:- Before effecting deduction at source one of the aspects to be examined is whether such income is taxable in terms of the Income Tax Act. This aspect has not been considered by learned Tribunal while concluding that the Appellant has committed a default in not deducting the tax at source.
We find it appropriate, in the interest of justice, to quash and set aside the impugned order of the learned Tribunal to the extent it holds that the Appellant has defaulted in not deducting tax at source and remand the matter to the learned Tribunal to examine the said aspect afresh. The impugned order passed by the learned Tribunal only to the extent it holds that the Appellant has committed default under section 40(a)(ia) of the Income Tax Act, 1961 is quashed and set aside
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2016 (3) TMI 1074
Seeking direction to disburse the refund along with the interest forthwith in terms of the provisional refund orders - Petitioner purchased cigarettes of various brands from the State of Gujarat and availed input tax credit in terms of section 11(3) of the GVAT Act as the same were purchased for the purpose of re-sale in the State of Gujarat and in the course of inter-state trade and commerce.
Held that:- for the purpose of invoking section 39 of the Act, the condition precedents that are required to be satisfied are: firstly that there should be an order which gives rise to a refund; and secondly, that such order should be subject matter of (i) appeal, or (ii) further proceeding, or (iii) any other proceeding under the Act should be pending. It is only if both these conditions precedent are satisfied then resort can be made to the provisions of Section 39 of the GVAT Act. In the present case, the first condition precedent, viz., an order giving rise to a refund is satisfied, inasmuch as, the order of provisional refund does give rise to a refund. Insofar as the second condition precedent is concerned, the respondent was not in a position to point out that any of the three eventualities specified in the section are satisfied. Thus, it is an admitted position that the order of provisional refund is not subject matter of appeal, nor is there any further proceeding in connection therewith, nor is any other proceeding under the Act pending. Therefore, none of the three contingencies constituting the second condition precedent for invoking Section 39 of the GVAT Act is satisfied. Therefore, clearly, the impugned order has been passed without the conditions precedent for exercise of such power being satisfied and therefore, lacks jurisdiction. Under the circumstances, the contention that the petitioner should be relegated to avail of the remedy of appeal under Section 73 of the GVAT Act does not merit acceptance, inasmuch as, it is by now well settled that when an order is without jurisdiction, it is permissible for the aggrieved party to invoke the extraordinary jurisdiction of this court under Article 226 of the Constitution of India.
The provisions of section 39 of the GVAT can be invoked provided the circumstances referred to hereinabove exist. If such circumstances exist, the Commissioner is empowered to withhold the refund provided he is of the opinion that such refund is likely to adversely affect the revenue. Thus, before withholding the refund, the Commissioner is required to form an opinion that the grant of refund is likely to adversely affect the revenue. The fact regarding formation of such opinion, therefore, should be reflected in the order passed under section 39 of the GVAT Act withholding the refund. in the absence of formation of any opinion that the refund is likely to adversely affect the revenue, the question of withholding the refund would not arise. Thus, none of the requirements for resorting to the power conferred by section 39 of the GVAT Act are satisfied in the present case. The impugned order, therefore, suffers from lack of jurisdiction and hence, cannot be sustained. Therefore, in the absence of formation of any opinion that the refund is likely to adversely affect the revenue, the question of withholding the refund would not arise. Thus, as none of the requirements for resorting to the power conferred by section 39 of the GVAT Act are satisfied, the impugned order cannot be sustained suffers from lack of jurisdiction. The respondents are directed to forthwith disburse the refund along with interest to the petitioner in terms of the provisional refund orders. - Decided in favour of petitioner
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2016 (3) TMI 1073
Unexplained share application money - Held that:- In the light of the factual position which is not disputed by the revenue, it cannot be said that the identity of the share applicants remained not proved by the assessee. Non production of directors of the investor company for examination by the AO it cannot be held that the identity of a limited company has not been established. For the reasons given above we uphold the order of CIT(A) and dismiss the appeal of the revenue. - Decided in favour of assessee
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2016 (3) TMI 1072
Unaccounted deposits in the three accounts of the assessee company in Federal Bank - Held that:- In view of the admission by the Id. AR as well as the fact the four hajj firms floated by the assessee company had no infrastructure of their own and they did not even had their own bank accounts, the income of the Hajj firms is to be assessed in the hands of the assessee company only.
As regards the merits of the addition is concerned, the assessee 'company had produced the details of all the transactions pertaining to the three accounts maintained in Federal Bank Calicut along with the copy of cash book, Profit and Loss account and Balance sheet of the company. The assessee has further filed the detailed analysis of the transactions carried out in the aforesaid bank. The assessee had filed the copies of details of all the bank transactions, details of sales of Air ticket and expenses pertaining to Hajj and Umrah Services for relevant assessment year along with the statement of cash flow. The ld.CIT(A) has verified the details of the bank accounts and found no infirmity in the details given by the assessee company. The objection of the revenue that the reliance should solely be placed on the statement of Sh. M. Narayana Kumar is misplaced. The assessing officer went on a wrong premise and added the entire deposits appearing in the bank accounts without deducting the withdrawals made. It is a settled principle of law that only the real income of the assessee has to be taxed and not notional income. In any case, the assessee could not have been subjected to tax only on the deposits in the bank accounts. - Decided in favour of assessee
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2016 (3) TMI 1071
Claim deduction u/s 80IA - initial assessment year - whether the assessee is entitled to deduction under Section 80IA without setting off the losses/unabsorbed depreciation pertaining to the windmill, which were set off in the earlier year against other business income of the assessee following the decision of M/s.Velayudhaswamy Spinning Mills (2010 (3) TMI 860 - Madras High Court) - Held that:- Interestingly, on the basis of the decision in Velayudhaswamy Spinning Mills, the Central Board of Direct Taxes has issued Circular No.1/ 2016 dated 15.2.2016 stating that it is abundantly clear from Sub-Section (2) that an assessee who is eligible to claim deduction u/s 80IA has the option to choose the initial/first year from which it may desire the claim of deduction for ten consecutive years, out of a slab of fifteen (or twenty) years, as prescribed under that Sub-Section. It is hereby clarified that once such initial assessment year has been opted for by the assessee, he shall be entitled to claim deduction u/s 801A for ten consecutive years beginning from the year in respect of which he has exercised such option subject to the fulfillment of conditions prescribed in the section. Hence, the term 'initial assessment year' would mean the first year opted for by the assessee for claiming deduction u/s 801A. However, the total number of years for claiming deduction should not transgress the prescribed slab of fifteen or twenty years, as the case may be and the period of claim should be availed in continuity.
Allow deduction u/s 801A in accordance with this clarification.
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2016 (3) TMI 1070
Condonation of delay - only ground seeking condonation of delay is that since the right of appeal has now been created, therefore, the appellant has a right of appeal against the order passed in 2008 - Held that:- We are unable to agree with this proposition inasmuch as, a right of appeal is a matter of procedure that gets converted into a substantive right as a creature of statute. The appeal has to be filed within the limitation prescribed. It cannot create a retrospective right to file an appeal which did not exist in the year 2008 or even on 06.01.2009 when the order was served on the appellant. In the absence of existence of such a right, it was open to the appellant to have filed a writ petition challenging the same in 2008-09. The very same view has been taken by the Tribunal and it has declined to grant any benefit of a bona fide act as urged by the appellant. The statutory remedy of appeal having come into existence on 01.06.2015, cannot be stretched retrospectively for extending the benefit as claimed by the appellant for condoning the delay. - the appeal deserves to be rejected.
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2016 (3) TMI 1069
Disallowance u/s 14A r.w.r 8D - Held that:- The facts are proved by the increase in reserve and surplus over the years which were at ₹ 414 crores as on 31.3.2008 against the investment in subsidiaries which stood ₹ 319.43 crores as on 31.3.2008. We also note that the assessee had taken loans from Financial Institutions amounting to ₹ 722.24 crores, out of which the working capital loan ₹ 258.79 crores and remaining pertains to term loans for the specific purposes. The AO took the entire interest debited to the profit and loss account amounting to ₹ 94.35 crores and worked out the disallowance accordingly. In our opinion, the ld CIT(A) had rightly deleted the disallowance on account of interest under rule 8D(2)(ii) of the Rules and rightly upheld the disallowance to the tune of ₹ 0.5% of the value of investment which comes to ₹ 1,35,14,428/- being 0.5 % of ₹ 270.28 crores by following the decisions of the earlier years in the case of the assessee wherein the similar issue came up for consideration before the Tribunal and decided in favour of the assessee.
Addition u/s 36(1)(iii) - proportionate interest expenditure pertaining to interest free loans and advances given by the assessee to subsidiaries companies out of interest bearing funds raised by the assessee - CIT(A) deleted addition - Held that:- The assessee's business expediency is proved beyond doubt that the entire interest free advances were given to the subsidiary company out of commercial expediency. In the case of Reliance Utilities and Power Ltd (2009 (1) TMI 4 - BOMBAY HIGH COURT ), The Hon'ble Court has held that the assessee has its own funds and simultaneously has borrowed interest bearing funds the presumption is that the advance of money is out of own funds and not out of interest bearing funds. We, therefore, respectfully following the ratio laid down in the above decisions supra confirm the order of ld. CIT(A) on this issue. - Decided in favour of the assessee.
Loss u/s 43(5)(d) on account of M to M losses - CIT(A) deleted the loss - Held that:- In view of the facts of the assessee and various judicial decisions of the coordinate benches following the decision of apex court in the case of Woolward Governor India Pvt. Ltd (2009 (4) TMI 4 - SUPREME COURT ) and special bench decision in the case of Bank of Bahrain and Kuwait (2010 (8) TMI 578 - ITAT, MUMBAI ), we are of the considered view that case of the assessee is fully covered by the decisions of the coordinate benches and we therefore respectfully following the same allow the appeal of the assessee on the issue of MTM losses by deleting the disallowance - Decided in favour of the assessee.
Disallowance of repairs and maintenance - Held that:- Expenses could not be disallowed merely on the ground that they are related to the transactions pertaining to earlier years unless and until the AO is fully satisfied after proper investigation about the crystallization of the liability and also the disallowance cannot be made merely on the ground that account maintained in the system of accounting and relates to the transactions of the previous year. In our opinion the true profits and loss of the assessee could only be determined if the expenses are allowed. Moreover, if these expenses are not allowed in this year, they are liable to be set off from the profit of the year ended 31.3.2006 related to the assessment year 2006-07. We, therefore, uphold the order of the ld. CIT(A) by dismissing the appeal of the revenue on this ground.- Decided in favour of the assessee.
Addition on account of repair and maintenance of furniture - Held that:- The bill dated 25.10.2005 is in respect of repairs and maintenance of the furniture, POP, painting etc were settled and finalised during the year. We further observed from the said records that the said bill could not be accounted for in the year to which it pertained as it was received late and at the year end it could not be possible to estimate the liability with reasonable degree of accurancy. The bill was received in the subsequent year and the CIT(A) has recorded the finding of facts that the crystallisation had taken placed during the year and pertained to the current year and AO had wrongly disallowed the same. - Decided in favour of the assessee.
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2016 (3) TMI 1068
Capital gains v/s business income - nature of income - Held that:- Taking into consideration the total effect of the principles, as advised by the Board, it would be clear that the short term capital gains is not on account of business activity. It is but similar to the activity in long term capital gains. As noted earlier, AO has accepted the long term capital gains on similar transactions in investment account. More over assessee has substantial trading income which was dealt separately in books of accounts. Therefore, we do not find any infirmity in the order of the CIT(A) in treating the gains on shares as capital gains as against the profits from business by the AO. - Decided against revenue
Disallowance of bad debts written off - Held that:- Once the bad debt is written off as irrecoverable in the books of assessee, the claim of bad debt cannot be disallowed. Moreover as held by the honourable Bombay High Court in the case of Shreyas S Morakhia [2012 (3) TMI 103 - BOMBAY HIGH COURT ] and in the case of Bonanza Portfolio Ltd [2009 (8) TMI 636 - DELHI HIGH COURT] , as assessee offered brokerage income which was taken into account in the books, the principle amount has to be considered as full amount of debt for claim of deduction. Even if a fraud was committed on that account the same is allowable as bad debt. We, therefore, uphold the order of the CIT(A) in allowing assessee’s claim of bad debts. - Decided against revenue
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2016 (3) TMI 1067
Entitlement to claim exemption u/s. 54 - reopening of assessment - Held that:- There is no dispute that assessee has made investment in the new property. It is also borne out from facts on record that investment in the second property is within the period of two years from the date of sale or original asset. That being the case, assessee will be eligible for exemption under section 54 of the Act. So far as AD's objections with regard to purchase of the property in the name assessee's wife is concerned, the same in our view is totally irrelevant and untenable. In any case of the matter, since we have already held that proceeding initiated under section 147 is invalid, this issue has become merely of academic interest. - Decided in favour of assessee.
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2016 (3) TMI 1066
Entitlement to exemption u/s.10(23C)(vi) - Held that:- Merely because the Assessee School does not have power to purchase, acquire, or sell the property, does not mean that the school will cease to exist as an Institution. Thus the ‘STATUS’ of the Assessee could be A.O.P. in the absence of any Memorandum of Association or Trust Deed. Considering the above decision of the I.T.A.T.Delhi Bench, in the present case also the above Matriculation School which is managed by Education Board and granted permission by the Director of School Education as early as 07.10.1997 is an “Institution” qualifying for exemption U/s. 10(23C)(vi) of the I.T.Act. Hence the exemption sough for the above “Institution” is to be granted. Accordingly, we direct the CCIT to grant exemption u/s.10(23C)(vi) of the Act. - Decided in favour of assessee.
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