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Showing 421 to 440 of 1464 Records
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2021 (10) TMI 1045
Revision u/s 263 by CIT - Delayed employees contributions to the Provident Fund (PF) - addition u/sec. 2(24)(x) - Deposits on or before due date of filing of return u/sec. 139(1) - HELD THAT:- An order cannot be termed as erroneous unless it is not in accordance with law. If assessing officer makes assessment in accordance with law, the same cannot be branded as erroneous by the commissioner. The Commissioner is not empowered to substitute his view to the view already taken by the AO in accordance with law or judgements of the higher Courts.
In the instant case the AO in view of the decisions of the Hon’ble High Courts, had taken the plausible and favourable view to the Assessee, while considering the expenses qua employees contribution to the provident fund deposited on or before due date of filing of return u/sec. 139(1) of the Act, and hence the assessment order can not be termed as erroneous and prejudicial to the interest of the revenue. Consequently the directions of the ld. Pr.CIT to the AO to make the addition u/sec. 2(24)(x) of the Act to the income already assessed in the assessment order dated 31/08/2017 and to pass the consequential order accordingly, cannot survive.
Assessee during the course of argument also raised an issue that Assessee’s return of income was selected for scrutiny under CASS but for limited purposes i.e. other deductions and other expenses claimed in the profit & loss account (as reflected in notice u/sec. 143(2) of the Act, dated 27/07/2016). The Assessee’s contention is that once the case is selected for limited scrutiny and not covering the issue other than involved for the limited purposes as specified in the notice, then the revenue authorities are not entitled to travel beyond the parameters except while following the due procedure prescribed as per law and instructions issued by the CBDT instructions No.20/2015, dated 29/12/2015 and 05/2016, dated 14/07/2016 etc., but not otherwise. The Assessee also relied upon the order passed by the coordinate bench of the tribunal in the case of M/s. Suraj Diamond Dealers Pvt. Ltd. [2019 (12) TMI 26 - ITAT MUMBAI].
As perused the other expenses and deductions debited in the profit & loss account and the expenditure incurred and specified in the profit & loss account for the year under consideration. The contention of the Assessee prima-facie seems to be correct, however as we are inclined to quash the impugned order on merit and therefore not travelling to this issue in detail, as the exercise would become academic only.
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2021 (10) TMI 1044
Deduction u/sec. 54B - Capital gain on transfer of land used for agricultural purposes not to be charged in certain cases - determination of distance of land - whether land in question falls beyond 8 km. from the local municipality? - conclusion of the Ld. Commissioner with regard to applicability of section 2(14)(iii)(b) is that the said section got amended w.e.f. 01/04/2014 where the distance is measured aerially, therefore, the amended provision is not applicable to A.Y. 2008-09 - HELD THAT:- If we consider the conclusion of the ld. Commissioner to the effect that provisions of section 2(14)(iii)(b) which got amended w.e.f. 01/04/2014 will not be applicable to A.Y. 2008-09 qua the case of the Assessee, then in principle the provisions prior to shall be applicable, whereby in 1994 the Central Government has notified the areas within the limits of Visakhapatnam municipality and as per that notification, the Assessee’s land in question is undoubtedly falls beyond 8 km. from municipal limits and thereafter no notification has been issued by the Central Government. Meaning thereby, the notification of 1994 still construed as in existence.
Even otherwise, the coordinate bench of the tribunal in the case of Jasti Vayunandana Rao [2010 (10) TMI 1082 - ITAT VISAKHAPATNAM] dealt with the exactly similar issue related to the A.Y. 2008-09 itself, of the same village i.e. Kapuluppada village, Bheemunipatnam Mandal of Vizag, where the land in question before the Co-ordinate Bench and the land sold by the Assessee is situated. The co-ordinate bench of the tribunal thoroughly examined the issue and came to a conclusion that undisputedly the impugned land was initially situated beyond 8km. from the municipal limit of Visakhapatnam Municipal Corporation, but later on, on incorporation of Greater Visakhapatnam Municipal Corporation, it falls within 8 km. from the Visakhapatnam limits, but no notification as required u/sec. 2(14) was issued in the official gazette by the Central Government to bring the land within the purview of section 2(14)(iii)(b). The Central Government is required to issue notification in the official gazette and without notification land falls within 8 km. from the local limits of any municipality would not declare to be an agricultural land.
Thus we do not have any hesitation to set aside the order passed by the ld. Commissioner and to delete the addition as income of the previous year as per section 54B(1)(i) as held by the AO and sustained by the Ld. Commissioner. Consequently, the addition stands deleted - Decided in favour of assessee.
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2021 (10) TMI 1043
Delayed payment qua employees share of ESI and PF - deposit of employees contribution qua ESI & PF after the prescribed dates as per the relevant Acts i.e. ESI & PF, but before filing of return u/sec. 139(1) - contention of the Assessee is that PF and ESI contribution of Employees, if paid within the due date of filing of return of income u/s 139(1) of the Act, then the same is allowable for deduction as per section 43B - HELD THAT:- We are of the considered view that as in the instant case, the employees contribution qua ESI & PF for the Asst. Year: 2019-20 has been deposited before the due date of furnishing the return of income u/sec. 139(1) of the Act and therefore cannot be subjected to disallowance, consequently, the addition sustained by the ld. Commissioner (NFAC) is liable to be deleted. - - Decided in favour of assessee.
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2021 (10) TMI 1042
Addition of commission paid to overseas agent - assessee was unable to prove the need for commission @ 25% paid to M/s. Khadlaj Perfumes LLC, whereas commission incurred with other parties was @ 0.5% to 5.85% - HELD THAT:- Assessee in this case has paid commission to its overseas commission agent. Agreement has been duly submitted. Payment has been duly made to the overseas commission agents. The same is duly approved by the RBI.
AO has questioned necessity of high rate of commission. In his opinion lower commission was to be paid. No case has been made out that the payment is bogus. In fact there was search and seizure operation at the premises of the assessee and no evidence was unearthed that the payments were bogus and non-genuine. Names and address of the overseas commission agents were very much there with the Assessing Officer. He insisted the assessee to produce principal officer of the overseas entity. Assessing Officer has made no effort whatsoever to make any independent examination of his own. He sits in the shoes of the businessman and decided that lower rate of interest should have been charged. In our considered opinion this is legally totally unsustainable.
CIT(A) has elaborately examined the issue and after detailed analysis of the factual data has come to the conclusion that the assessee’s performance has hugely increased pursuant to support from the commission agents. In this view of the matter in our considered opinion learned CIT(A) has passed a correct order. Addition made by the Assessing Officer is solely based upon surmises and conjecture without any cogent independent verification on record. See RAJARANI EXPORTS PVT LTD [2013 (5) TMI 410 - CALCUTTA HIGH COURT].
TP Adjustment - transfer of fund for equity capital - assessee advanced interest free loan to its subsidiary - HELD THAT:- As assessee has given funds to its subsidiary initially which has been converted later on into equity capital. For the intervening period the Assessing Officer has charged 10% notional interest. The Revenue was relied upon the case of Perot System TSI India Ltd.[2009 (10) TMI 638 - ITAT DELHI]. There was no issue of conversion of fund into equity in the case of Parot System TSI India Ltd. (supra). However in the present case the plea is that fund transferred was for conversion into equity and there was some procedural delay. This has been accepted by learned CIT(A) on the touchstone of the ITAT Ahmedabad decision in the case of Micro Inks Ltd. [2009 (10) TMI 638 - ITAT DELHI] We find that the proposition that transfer of fund for equity capital does not attract transfer pricing adjustment.
Assessment u/s 153A - addition when no incriminating material was found and these were completed assessment - HELD THAT:- Hon'ble Bombay High Court in the case of CIT Vs. Continental Warehousing Corporation (Nhava Sheva) Ltd. [2015 (5) TMI 656 - BOMBAY HIGH COURT]has held that in the case of completed assessment no addition can be made under section 153A of the Act dehorse any incriminating material found. It is not disputed that upto A.Y. 2006-07 these were completed assessment and no incriminating material was found. To this extent this ground raised by the Revenue stands dismissed.
Addition of staff welfare expenses - AO also disallowed expenses on account of purchase of goats for distributing it to its employees for Eid celebration - CIT(A) has upheld the addition by holding that there is nothing to indicate that this expenditure was incurred specifically on the employees of the assessee company and there is no detail available as to the number of employees of the assessee company, the number of employees who are Muslims and the reasonableness of the said expense - HELD THAT:- We find that learned CIT(A) has passed reasonable order. In the absence of necessary details in this regard expenditure involved cannot be allowed as business expenditure. The decision of Borsad Tobacco Co. P. Ltd. [2019 (9) TMI 1600 - ITAT MUMBAI] referred by learned Counsel of the assessee are not applicable on the facts of this case. Hence, we uphold the order of learned CIT(A)
Expense for obtaining special number for car - as per AO there is no benefit to business in any way and therefore he disallowed the expenses - HELD THAT:- We find that the orders of the authorities below are appropriate that expenditure for obtaining “fancy number for the car” is not at all business expenditure. Hence, there is no question of allowing the same as revenue expenditure or capitalizing the same and allowing depreciation thereon. Hence, we uphold the order of learned CIT(A).
Excess physical stock found in search - HELD THAT:- We find that the addition in this regard is based upon the excess stock found during search and we do not find any infirmity in the order of the authorities below. Even the assessee is taking shifting stand partly accepting and partly denying the veracity of findings. This is not sustainable. Hence, we uphold the same.
Excess cash found - amount of the seized cash would be added to the Total Income u/s. 69A - We find that the assessee has contended that it was never a case the assessee has not pressed for this ground. Hence, in our considered opinion this issue has been left unadjudicated by learned CIT(A). Moreover the Assessing Officer has rejected the assessee’s explanation without mentioning as to what was the explanation. Hence, in the interest of justice we remit this issue to the file of learned CIT(A). The learned CIT(A) is directed to consider this issue afresh and decide as per law.
Addition of commission paid to overseas agent - HELD THAT:- As decided in own case commission on export activity had been fully disclosed in all correspondences and activities in relation to export, the commission was paid through banking channel of RBI approval and it was paid pursuant to an agreement approved by Government of India and UN. The payment of commission was for business consideration and there was apparently no illegality in making payment of commission. Besides this, nothing has brought on record to show that the transactions relating to payment of commission are non-genuine or are excessive and unreasonable.
Unexplained purchases - HELD THAT:- We find that the addition has been made by the Assessing Officer without any cogent material. The assessee has supplied all purchase/evidence. This has been rejected by the Assessing Officer without any reasoning whatsoever. Moreover learned CIT(A) has also given finding that the said purchase was not routed through profit and loss account as expenditure. For all these reasons we do not find any infirmity in the order of learned CIT(A). Hence, we uphold the same.
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2021 (10) TMI 1041
Addition u/s 68 - advances for agricultural land as shown by the assessee - assessee failed to provide necessary evidences to prove the genuineness or transactions and creditworthiness of the persons giving advances - CIT-A deleted the addition - HELD THAT:- Addition as made by the Assessing Officer on account of advance received against sale of land by invoking the provisions of section 68 of the Income-Tax Act, 1961 were unjustifiable since the amount of advances received by the assessee were subsequently adjusted against the sales made by the assessee and the same was also verifiable from the registered sale deeds - AO was not justified in treating the amount of advance received by the assessee as his income as the AO failed to consider the fact that the assessee had sold agricultural land belonging to him to Shri Rakesh Agrawal in lieu of consideration which included the amount of advance received from the said party. Accordingly, we are of the view that the additions made by the Assessing Officer were rightly deleted by the Ld CIT(A). - Decided against revenue.
Additions u/s 68 - unsecured loan from various persons - HELD THAT:- On perusal of the remand report, we find that the Assessing Officer did not comment on any of the documents filed by the assessee during the course of the appellate proceedings rather the Assessing Officer reiterated the findings of the then Assessing Officer. Thus, it is clear that the Assessing Officer failed to controvert the genuineness of the transaction and identity as well as creditworthiness of these parties.
As from documentary evidences, it is apparent that the assessee satisfactorily discharged the primary onus cast upon him under section 68 of the Income-Tax Act, 1961 to establish the identity and creditworthiness of these parties and genuineness of the transactions as entered into with them. Taking into consideration all these facts, the ld. CIT(A) examined each and every entry in respect of unsecured loan received from the creditors and reached to the conclusion that the addition made by the Assessing Officer is unjustified. In view of these facts, we are of the view that it is a settled position of law that no addition is called for under section 68 of the Income-Tax Act, 1961 on account of unsecured loans if the assessee establishes the identity and creditworthiness of the parties and genuineness of the transactions as entered into with them - Decided against revenue.
Disallowance of interest out of property income and on account of disallowance of interest out of income from other source - HELD THAT:- We find that copy of repayment schedule/ loan statement in respect of the loan taken from ICICI Bank Ltd. and State Bank of India have been filed so as to justify the amount of interest paid and claimed as deduction during the year under consideration. In view of these facts, it is clear that the disallowance made by the Assessing Officer was unjustified as the borrowed funds were utilized towards purchase of the properties which were let-out and rental income earned therefrom was offered for tax under the head ‘Income from House Property’ and more so when such deduction on account of interest was allowed in the preceding as well as subsequent years. Therefore, we do not find any reason to interfere with the order of the ld. CIT(A) on this point. Accordingly, ground of the Revenue is dismissed.
Addition on account of interest claimed under the head ‘Income from Other Sources’ - assessee failed to prove the direct nexus of funds borrowed and advanced to the parties from whom interest income was earned - HELD THAT:- It is clear that the disallowance made by the Assessing Officer was unjustified as the borrowed funds were utilized towards advancement of loan to the parties from whom interest income was earned and was duly offered for tax under the head ‘Income from Other Sources’ and more so when such deduction on account of interest was allowed in the preceding as well as subsequent years. Therefore, we do not find any reason to interfere with the order of the ld. CIT(A) on this point. Accordingly, ground no.4 raised in the appeal of the Revenue is dismissed.
Taxability of agricultural income as income from other sources - HELD THAT:- We find that the assessee had submitted before the Revenue Authorities that that agricultural land owned by him was given on Batai and agricultural income earned therefrom was duly shown in the income-tax return and the Assessing Officer himself did not disbelieve the agricultural lands owned by the assessee. Further, the assessee has filed the detail of the persons to whom agricultural land was given on Batai and from whom agricultural income was received during the year along with the details with respect to area of land - the amount of agricultural income was duly shown by the assessee in his income-tax return every year and the agricultural income shown by the assessee had also been duly examined and accepted in the preceding as well as subsequent years.
On consideration of above facts, it is clear that non-acceptance of agricultural income shown by the assessee in his income-tax return was unjustified more so when agricultural income was shown by the assessee on a year-to-year basis and such agricultural income had also duly been examined and accepted in the preceding as well as subsequent years. Thus, we direct the Assessing Officer to accept the agricultural income in full.
Disallowance u/s 40(a)(ia) of the I.T. Act for non-deduction of TDS on the amount of late payment charges - benefit of the second proviso to section 40(a)(ia) - HELD THAT:- As second proviso to section 40(a)(ia) of the Act shall have retrospective effect from 01-04-2005 and in the present case, the relevant assessment year is the Assessment Year 2010-11 and the benefit of the second proviso to section 40(a)(ia) of the Act shall be available to the assessee as the assessee had obtained and furnished the certificate of the CA of the broker wherein it has been clearly certified that the amount on which TDS not deducted by the assessee was included in the total income of the payee and requisite amounts of taxes due were also paid on it. Therefore, we do not find any reason to interfere with the order of the ld. CIT(A) on this point. Accordingly, ground no.6 raised in the appeal of the Revenue is dismissed.
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2021 (10) TMI 1040
Sanction of scheme of Amalgamation - Sections 230 to 232 and other applicable provisions of the Companies Act, 2013 and in terms of Rule 15 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 - HELD THAT:- The objections/observations to the Scheme received from RD, RoC, OL, BSE, and IT Department have been adequately replied by the Applicant Companies and hence, there is no impediment in approval of the Scheme.
The scheme is approved - application allowed.
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2021 (10) TMI 1039
Admissibility of application - monetary amount involved in the appeal - power of tribunal to review application - Fraudulent acts of the Respondents - pivotal submission is that ‘Fraud’ vitiates the ‘entire judicial proceedings’ and that if such fraudulent acts of the Respondents are permitted and the order passed by this Appellate Tribunal is not recalled - HELD THAT:- Resting upon ‘Review’ the ‘’Tribunal’’ would not rehear the parties on ‘Facts’ and ‘Law. No wonder, a re-appraisal of evidence on record for unearthing an error will amount to an exercise of ‘Appellate Jurisdiction” which is not permitted in Law. A ‘’Review’’ is not to be sought for a ‘Fresh Hearing’ or ‘Arguments’ or ‘Correction of an erroneous view’ taken earlier.
It is the well laid down proposition of law that ‘in the absence of any power of ‘Review’ or ‘Recall’ vested with the ‘Adjudicating Authority’ – ‘Appellate Authority’, an order/ judgment passed by it cannot be either Reviewed or Recall as opined by this Tribunal - It cannot be gainsaid that there is no express provision for ‘’Review’’ under the National Company Law Appellate Tribunal Rules, 2016. Moreover, the Applicant/Appellant cannot fall back upon Rule 11 of the NCLAT Rules, 2016 which provides for “inherent powers’’. In fact, Rule 11 of NCLAT Rules, 2016 is not a substantive Rule which showers any power or jurisdiction upon the ‘’Tribunal’’. Undoubtedly, the ‘Tribunal’’ has no power to perform an act which is prohibited by Law.
This Tribunal taking note of the prime fact that the Applicant/Appellant has sought for “recalling” the judgement passed by this Appellate Tribunal is impermissible in Law - application dismissed.
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2021 (10) TMI 1038
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - Existence of debt and dispute or not - time limitation - proper service of demand notice or not - HELD THAT:- The demand notice was sent to the registered address of the corporate debtor on 21.06.2018. It can be seen that the corporate debtor has replied to the Demand Notice on 29.06.2018 (Annexure-II(A)-24. Therefore, the question of non-delivery of Demand Notice does not arise at all. It can be seen that the operational creditor has replied to the response/reply vide notice dated 11.07.2018. In view of the same, it is held that demand notice has been duly served.
Whether the operational debt was disputed by the corporate debtor? - HELD THAT:- The respondent-corporate debtor has filed reply and raised objections with regard to quality of material supplied by the operational creditor. It can be seen that respondent has raised the same objection in its reply to Demand Notice dated 29.06.2018. However, the corporate debtor has raised the objections for the first time only after issuance of Demand Notice dated 21.06.2018 and has failed to show that if any dispute was raised prior to the issuance of Demand Notice. Thus, the dispute was raised for the first time only after service of Demand Notice, therefore it cannot be treated as pre-existing dispute. Hence, this issue is held in favour of the petitioner.
Time Limitation - HELD THAT:- It can be seen that the invoices and lorry receipts Annexure 1(A)-1 to Annexure 1(A)-18 pertains to the years 2014 and 2015. The present application is filed on 13.07.2018. It can be seen from the Balance Confirmation letter dated 31.03.2016 issued by the corporate debtor, that the corporate debtor has acknowledged the debt amounting to ₹ 93,05,491/- towards operational creditor. Thus, the CP is well within the period of limitation.
It has been shown that the corporate debtor has failed to make payment of the aforesaid amount due as mentioned in the statutory notice till date. It is also observed that the conditions under Section 9 of the Code stand satisfied. Accordingly, the petitioner proved the debt and the default, which is more than ₹ 1 lakh by the respondent-corporate debtor - the present petition being complete and having established the default in payment of the Operational Debt for the default amount being above ₹ 1,00,000/-, the petition is admitted in terms of Section 9 of the IBC and accordingly, moratorium is declared in terms of Section 14 of the Code.
Petition admitted.
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2021 (10) TMI 1037
Liquidation of the Corporate Debtor - Section 33(1) of the Insolvency and Bankruptcy Code, 2016 - HELD THAT:- This Tribunal is of the view that the endeavours to obtain resolution of corporate debtor has failed and CoC in its commercial wisdom decided to liquidate the corporate debtor which does not require any interference, thus in present circumstances the CoC decision is appropriate.
The corporate debtor KK Milk Fresh India Ltd., stands liquidated and the incidence of liquidation to follow, on and from the date of this order in terms of the provisions of IBC, 2016 and more particularly as given in Chapter-III of IBC, 2016 and also in terms of Insolvency and Bankruptcy (Liquidation Process) Regulations, 2017 - Application allowed.
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2021 (10) TMI 1036
Seeking approval of Resolution Plan - section 30(6) and 31 of the IBC, 2016 read with Regulation 39(4) of the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 - HELD THAT:- The resolution plan is for the amount of ₹ 96.50 crores, which is to be paid in 150 days from the date of approval of Resolution Plan by this Adjudicating Authority and all the funds shall be sourced by the Resolution applicant through its internal sources which includes the working capital and through its FDR of ₹ 30,50,00,000/- with Yes Bank in the name of the Group Companies and the balance amount will be paid through the internal resources of the company - the resolution plan, as approved by the CoC, is found in accordance with the sub-section 2 of Section 30 read with Section 31 of the Code, thus the Resolution Plan under sub-section (1) of Section 31 of the Code is approved.
The Resolution Applicant is allowed to remove and/or substitute the Monitoring Agency with prior approval of this Adjudicating Authority if the Monitoring Agency is unable to satisfactorily perform its responsibilities or breaches terms of its appointment.
The resolution plan, as approved by the CoC, is found in accordance with the sub-section 2 of Section 30 read with Section 31 of the Code - the scheme is approved - application allowed.
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2021 (10) TMI 1035
Liquidation of Corporate Debtor - Section 33(2) of the Insolvency and Bankruptcy Code, 2016 - HELD THAT:- Appointment of Liquidator-Section 34(1) of the Code provides that where the Adjudicating Authority passes an order for liquidation of the corporate debtor under Section 33, the resolution professional appointed for the corporate insolvency resolution process shall, subject to submission of written consent act as the Liquidator for the purpose of liquidation.
In the present case, the Resolution Professional has sufficient time available to file an application before Adjudicating Authority for liquidation of corporate debtor i.e. from 07.03.2021 till 23.03.2021. However, the application was filed on 02.11.2020 and no explanation with regard to the delay at least from 07.03.2021 to 23.03.2021 i.e., the date of passing of the resolution by CoC for liquidation of the Corporate Debtor to the date of imposition of Ist lockdown, has been given in the application. In view of the lackadaisical conduct of the RP, we are of the view that RP should not be continued as Liquidator in the present case.
The corporate debtor Addinath Rubbers Private Limited is directed to be liquidated in the manner as laid down in Chapter III of the Code - Application allowed.
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2021 (10) TMI 1034
Approval of resolution plan - section 30 (6) of Insolvency and Bankruptcy Code, 2016 read with section 31 of IB Code and Regulation 39 (4) of The Insolvency and Bankruptcy Board of India (Insolvency Process of Corporate Persons) Regulations, 2016 - HELD THAT:- The Resolution Plan provides for the settlement of the claims of various stakeholders. The Resolution Plan also provides the background of the successful Resolution Applicant and its associates, and the financial capabilities of the successful Resolution Applicant. Hereafter, Resolution Plan is both feasible and viable, Resolution Plan also contains the procedure for its effective implementation of the Resolution Plan - the Resolution plan also provides for the appointment of RP as the person in charge to look after the implementation of the Resolution Plan. The Resolution Plan has also addressed the issues which resulted in the Insolvency of the Corporate Debtor and future business plan so as to such a situation does not arise again.
The Resolution Plan' filed with the Application meets the requirements of Section 30 of IB Code, 2016 and Regulations 37, 38, 38(1A) and 39 (4) of IBBI (CIRP) Regulations, 2016 - resolution plan is approved - application allowed.
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2021 (10) TMI 1033
Seeking grant of extension of time to continue the liquidation process for further period of one year with the exclusion of the lockdown period - HELD THAT:- It is seen from the averments made in the application, that liquidation in relation to the Corporate Debtor was ordered by this Tribunal on 27.08.2019 and as such the Liquidation period in relation to the Corporate Debtor is required to be completed on or before 27.08.2020. The Applicant in the Application has averred that the avoidance applications filed by Liquidator are yet to be adjudicated by this Tribunal and till such time the avoidance application is adjudicated, the Liquidation process in relation to the Corporate Debtor cannot be completed. Further, it is also seen that the assets of the Corporate Debtor are yet to be sold.
This Authority feels that it is just and proper to extend the Liquidation period for a further period of one year and as such the Liquidation period of the Corporate Debtor is extended for a period of one year and the Liquidation process in relation to the Corporate Debtor is required to be completed on or before 20.12.2021 - Application allowed.
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2021 (10) TMI 1032
Directions of this Tribunal complied by the Respondents or not - Applicant submitted that the Respondents/Corporate Debtor has not handed over the books and records to the Applicant - HELD THAT:- It is seen that the documents in relation to the Corporate Debtor had already been handed over to the Applicant and the documents in relation to the Guduvancherry and Thiruvallur property belongs to 1st and 2nd Respondents. Further, it is averred that the documents relating to company affairs before the month of November 2015 were destroyed in the flood which happened during the year 2015.
The Respondents are directed to extend full co-operation to the Liquidator in case of any documents are being sought for in future, for completion of the Liquidation process in relation to the Corporate Debtor - application disposed off.
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2021 (10) TMI 1031
Manufacture - whether the activity of metalizing undertaken by the assessee amounts to manufacture or not? - HELD THAT:- There are no reason to deviate from the finding of fact recorded by the Tribunal, which is consistent with the record of the case.
The conclusion reached is inevitable - there is no merits in this appeal and the same is dismissed.
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2021 (10) TMI 1030
Rejection of application for settlement of disputes under the Sabka Viswas (Legacy Dispute Resolution) Scheme, 2019 - excisable goods - supplies made as against international competitive bidding to power projects, under exemption - Department adopted the view that the commodity supplied, being lubricant, was only used as a coolant/lubricating agent and hence did not entitle the petitioner to the exemption sought - HELD THAT:- The incidence of duty must not be looked at a mechanical event but a constructive one, that contains all incidents of a taxable event. Thus, to attract levy of duty, a practical point of view must also be called into play to determine whether the goods are marketable or capable of being marketed. Though in that case the Court was concerned with whether the commodity in question was capable of being marketed as a distinct and marketable product, the observations made would apply to the present scenario as well, since in the present case, there is no rate of duty that is set out alongside ‘lubricants’ that may be applied to a transaction of manufacture and sale of the said lubricant.
Thus, even though the product in this case is marketable, it does not answer to the question of ‘excisable goods’ as, practically there can be no levy of duty thereupon in the absence of a stipulated rate and applicable rate of duty. Thus, notwithstanding that the language of Section 125(h) of the SVLDRS Scheme uses the phrase ‘with respect to excisable goods set forth in the Fourth Schedule to the Central Excise Act, 1944’, the use of the word ‘excisable’ cannot be seen to be cosmetic, but must contain some purpose - Mere mention of the commodity without the rate of tax would serve no purpose as far as excisability is concerned.
Neither the judgment of the Hon’ble Supreme Court in the case of MOTI LAMINATES PVT. LTD. VERSUS COLLECTOR OF CENTRAL EX., AHMEDABAD [1995 (2) TMI 67 - SUPREME COURT], the General Rules of interpretation to Schedule 4 of the Act nor the Clarification of the OSD have been brought to the notice of the Division Bench of the Allahabad High Court while considering the case of M/S INDIAN OIL CORPORATION LIMITED VERSUS UNION OF INDIA AND 2 OTHERS [2020 (12) TMI 316 - ALLAHABAD HIGH COURT] and for these reasons, this decision is distinguishable.
Petition allowed.
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2021 (10) TMI 1029
Activity amounting to manufacture or not - fixing of a lens in a spectacle frame - Remission of Excise Duty - activity of fixing of prescription lenses in spectacle frames - HELD THAT:- A perusal of the show cause notice reveals that the activity carried out in the show rooms was the manufacture and clearance of spectacles carrying 'Titan Eye+’ Brand. Though adverse inferences are sought to be drawn by the respondents on other grounds as well, such as violation of conditions contained in Notification 8/2003-CE dated 01.03.2003, this point has not been argued and both the parties before me have confined the scope of the arguments to (i) whether the respondents were right in law in having issued the impugned show cause notices inspite of binding judicial precedents to the opposite effect and (ii) whether the assembly of prescription lenses on to a spectacle frames is an activity that amounts to ‘manufacture’ attracting levy of duty under the Act.
The petitioners would specifically confirm that manufacture of the power lens i.e., the conversion of lens blanks into prescription lens is a taxable activity and that such activity takes place in the workplace/factory. They also confirm that the frames used are either imported or manufactured indigenously in a factory, subject to central excise duty. These two activities i.e. manufacture of the spectacle frames and prescription lenses are, admittedly excisable events and the petitioners are liable to remit duty in regard to the aforesaid two events, where applicable. The petitioners also engage in sale of ready-made eye-wear that is purchased by customers, off-the-shelf.
Post manufacture of the spectacle frames and lenses, the goods are sent separately to the petitioners’ show rooms and what is undertaken in the show room is only an assembly of the prescription lenses and the spectacle frames wherein the lenses are merely mounted upon the frames, to result in a spectacle - The process of assembly is bound to involve some amount of refining and fine-tuning of the individual components and this, by itself, will not tantamount to manufacture. In fact, most establishments engaged in selling eye-wear provide a gamut of services in this area including, having an optician in their employ or on call, and infrastructure for the testing of vision. Thus, notwithstanding that a distinct commercial product is obtained upon assembly of a lens with a spectacle frame, this would not result in such assembly being equated to manufacture.
The judgments in the cases of BHOLANATH SREEMANY VERSUS ADDITIONAL COMMISSIONER OF COMMERCIAL TAXES AND OTHERS [1978 (7) TMI 225 - CALCUTTA HIGH COURT] and M/S AMAZON SELLER SERVICES PRIVATE LIMITED, BANGALORE VERSUS THE COMMISSIONER OF CENTRAL EXCISE, THANE-I [2016 (3) TMI 69 - AUTHORITY FOR ADVANCE RULINGS] decide and reiterate the issue of whether the activity of assembly simpliciter including fitting and minor adjustments that are part and parcel of the process of assembly, constitute ‘manufacture’ for the purposes of the Act, in favour of the assessee. The show cause notices, to this extent, and insofar as they purport to equate the process of assembly to manufacture, are quashed.
Petition allowed.
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2021 (10) TMI 1028
Rebate Claim - rejection on the ground that since the goods exported vide the said ARE-I were reimported by the Applicants, it implied that the export was not completed - whether the rebate of Central Excise duty paid in respect of exported goods would be admissible when the goods were exported before advent of CGST regime but rebate claimed after it? - Rule 18 of Central Excise Rules, 2002 - HELD THAT:- As the goods were reimported and a credit note was issued against the proceeds realised, the lower authorities have taken a view that the export was not complete. As per Section 2(18) of the Customs Act, 1962, “ ‘export’ with its grammatical variations and cognate expressions, means taking out of India to a place outside India”. In the present case, the goods were taken out of India and reached buyer’s place who returned them. Thus, it is clear that goods had been taken to and had reached a place outside India. Subsequent reimport of goods would not change this factual position.
The findings of Commissioner (Appeals) on this count cannot be sustained. Further, the Applicants have correctly drawn attention to the provisions of Section 142(1) of the CGST Act, 2017 which provide for refund of Central Excise duty paid in accordance with the Central Excise Law if the Central Excise Duty had been paid for any goods at the time of their removal not earlier than six months from the appointed date i.e. 1-7-2017 and if the goods are returned within a period of six months from 1-7-2017 and are identifiable to the satisfaction of proper officer.
In the present case, the goods were removed for export on payment of Central Excise duty on 22-6-2017 (i.e. not earlier than six months from 1-7-2017) and were imported back on 23-11-2017 (i.e. within six months from 1-7-2017). There is also no dispute regarding the identity of goods. The Government further observes that upon import, IGST was paid and no refund of IGST, so paid, has been claimed. Therefore, sanction of rebate of Central Excise duty paid will also not lead to any double benefit. In these facts and circumstances, the Government holds that the rebate claim is admissible.
Application allowed.
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2021 (10) TMI 1027
Interpretation of statute - Section 8 (5) of the CST Act - inter-state sale - C-Form - changes brought about by the amending Act of 2002 governs only Section 8 (5)(a) and not Section 8 (5)(b) of the CST Act is right and justifiable? - Whether the Division Bench of the Hon’ble High Court of Karnataka was justified in not considering the Notification No.FD 199 CSL 2002(4) dated 31.5.2002 in the right prospect, though the same was upheld by the Division Bench of the Karnataka High Court in W.A. No.2417 of 2007 dated 02.04.2009 in the case of M/s Volvo India Pvt. Ltd.? - HELD THAT:- Giving effect to the industrial policy 1996-2001, Government of Karnataka issued a notification bearing No.FD:32 CSL 96(II) dated 15.11.1996 under Section 19-C of the KST Act providing for tax exemptions or deferrals. Similarly, a corresponding notification dated 15.11.1996 was also issued under 19-C of Act read with Section 9 (2) of CST Act. The said notification issued under the CST Act exempted/deferred the tax payable under CST Act in respect of goods manufactured and sold in the course of inter-state trade and commerce by industrial units which are eligible and opted for the benefit prescribed under the notification dated 15.11.1996 issued under KST Act - The assessee had utilized FAVC tax exemption to a certain extent up to 01.04.2002. In the meantime, Section 8 (5) of the CST Act was amended with effect from 11.5.2002, thereby the benefit of tax exemption under Section 8 (5) of CST was made subject to the condition mentioned in Section 8 (4) of the CST Act pursuant to which the notification dated 31.5.2002 was issued by the Government of Karnataka specifying that exemption of tax shall be subject to the condition of furnishing declaration ‘C’/’D’ forms by the assessee.
It is now pointed by the learned counsel for the parties that said Special Leave Petitions are admitted and C.A. Nos. 473-480/2016 are pending, but no interim order of stay has been granted. In view of aforesaid, we have no hesitation to dispose of this petition answering question of law in favour of assessee and against Revenue subject to the result of C.A. Nos. 473-480/2016 pending before the Hon’ble Apex Court. However, we make it clear that the dispute being confined herein to the exemption claimed in respect of inter-state sales turnover which is not supported by production of ‘C’ or ‘D’ forms, this decision would not come in the way for consequential adjustments.
The question of law, with regard to interpretation of statute, is answered in favour of the assessee and against the Revenue - the question with regard to non-consideration of Notification No.FD 199 CSL 2002(4) dated 31.5.2002, does not arise for consideration in view of the first question, being answered in favour of the assessee - appeal dismissed.
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2021 (10) TMI 1026
Offence punishable under Section 55(a) of Kerala Abkari Act - only evidence against the accused No.1 is of an alleged confession made by the accused No.2 - HELD THAT:- It is well settled that T.I Parade is a part of investigation and it is not a substantive evidence. The question of holding T.I Parade arises when the accused is not known to the witness earlier. The identification by a witness of the accused in the Court who has for the first time seen the accused in the incident of offence is a weak piece of evidence especially when there is a large time gap between the date of the incident and the date of recording of his evidence. In such a case, T.I Parade may make the identification of the accused by the witness before the Court trustworthy. However, the absence of T.I Parade may not be ipso facto sufficient to discard the testimony of a witness who has identified the accused in the Court - in the facts of the case, the evidence of PW13 as regards the identification of the accused Nos.2 and 4 in the Court cannot be accepted.
PW8 was a police constable working at the concerned police station. He claimed that after the truck was stopped, three persons in the truck ran away. One was caught who disclosed that he was the driver of the truck. He identified the accused No.2 in the Court. However, he has not seen accused No.2 driving the truck. PW10 Shri N. George was a police constable attached to the concerned police station who claimed that after the truck was stopped, three persons inside the truck ran away and one person who was stopped, claimed to be the driver of the truck. However, he has not stated that he had seen the accused No.2 driving the truck. He also identified the accused No. 4 as a person who ran away from the truck.
It is very difficult to believe that PW13 who was not knowing the accused Nos.2 and 4 prior to the incident could identify them in the Court after lapse of 11 years. That is also the case with all the official witnesses. The prosecution has chosen not to produce evidence regarding the correct registration number of the truck and the name of the registered owner thereof. Therefore, the entire prosecution case becomes doubtful.
The impugned judgment and orders are hereby set aside and the appellants are acquitted of the offences alleged against them. Their bail bonds stand cancelled - Appeal allowed.
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