Since, it is already 4.30 p.m., there is not enough time left to hear the arguments in the matter. Counsel for the parties (except counsel for respondent No.1/RBI as the said respondent is not a party before the NCLT), are agreed that while NCLT may go on with the proceedings, any orders passed thereto will be subject to the final outcome of the present writ petition.
Petitioner will be at liberty to file rejoinders to the counter affidavits filed by the respondents. Renotify the matter on 16.8.2018.
Not provided the opportunity as requested by the appellant - non speaking order - Held that:- It is seen that the assessee’s returned income of ₹ 13,74,000/- odd was selected for scrutiny, wherein the assessment was concluded at an income of ₹ 29,43,820/-.
The additions made by the AO were challenged in appeal before the CIT(Appeals) where initially time was sought subsequently on 25.11.2014 neither anyone appeared nor any request for time was made. The assessee remained unrepresented for the reasons beyond the control of the counsel. Accordingly, accepting the submissions to be correct and true and also accepting the oral undertaking giving by the Ld. AR the impugned order is set aside back to the file of the CIT(A) with the direction to pass a speaking order in accordance with law after giving the assessee a reasonable opportunity of being heard - Appeal of the assessee is allowed for statistical purposes.
Refund of SAD - N/N. 102/2007 Cus.- dt.14.9.2007 - Unjust Enrichment - rejection on the ground that the C.A. Certificate produced by the appellant is not proper and therefore has not established that the claim is not hit by unjust enrichment - Held that:- C.A. Certificate is issued by the statutory auditor of appellants. It is also been stated therein that appellants have not passed on the CVD to its’ customers. The C.A. Certificate is enclosed with annexures to support the same - the said certificate suffice the requirement as per condition 2 (e)(iii) of the notification - rejection of refund is unjustified - appeal allowed - decided in favor of appellant.
CENVAT Credit - capital goods - MS Plates, MS checkered plates, MS sheets, MS channels, HR steel coils etc. - Held that:- The impugned items in the present appeal were used for fabrication of storage tank. The appellants are engaged in manufacture of denatured ethyl alcohol and such storage tanks are an indispensable item in the manufacturing activity. Without such activity of fabrication using the MS plates, MS sheets, HR coils etc. the storage tank cannot be installed within the factory at the required height to be used in the process of manufacture.
The Larger Bench of the Tribunal in the case of Commissioner of Central Excise, Meerut Vs. Modi Rubber Ltd. [2000 (5) TMI 64 - CEGAT, NEW DELHI] has held that if the appellants are eligible for credit either under capital goods or inputs, the credit has to be allowed.
Broadcasting services - Whether the impugned Regulations and the Tariff Order can exist and operate through the powers conferred to and under the TRAI Act, 1997?
Whether the impugned Regulations and the Tariff Order would impinge upon the provisions of Copyright Act, 1957?
Held that:- The jurisdiction of the enactments have already been dealt with in extenso. Suffice it is to state that TRAI Act involves regulation of airwaves and frequencies being public properties, touches upon various stakeholders with primacy to the public interest. To put it differently, the general public is the king, being the subscriber whose interest should be guarded and protected under the Act as a prime factor. TRAI is thus, obligated to take adequate measures as mandated by the statute. The Cable Television Networks (Regulation) Act, 1995 and the Indian Telegraph Act, 1885 go with the TRAI Act strengthening the hands of the authority. TRAI Act came into being on the need enough to have a better enactment than the Telegraph Act, 1885, supported and safeguarded by the Cable Television Networks (Regulation) Act, 1995. This Act deals with cable television network. That is the reason why, the authority is the same along with the definition of digital addressable system and introduction transmission of programmes through digital addressable system etc. Therefore, this enactment deals with the last part of the broadcast.
Section 2(k) of the TRAI Act merely explains a telecommunication service. Therefore, even assuming it can be divided into three parts as suggested by the learned counsel for the petitioners, the conclusion does not change. The TRAI Act does not deal with a mere means of transmission alone. Perhaps the petitioners do understand it rather well. That is the reason why they laid the challenge before the Division Bench of Delhi High Court to the very provision. The principle governing the noscitur a sociis cannot be applied as the petitioner suggested. There is no ambiguity on the definition provision.
The permission obtained from the Central Government would bring a broadcaster within the fold of a service provider. The petitioners themselves claimed and raised disputes as service providers. A finding was also rendered by the Court which reached finality. Thus, as a natural sequitor, the Regulations and Tariff Order would ipso facto apply to the petitioners' case.
While there is no BRR involved under the TRAI Act, no right has been given to a television channel under Section 37 of the Copyright Act. Merely because, the television channel becomes a broadcaster, no independent right can be placed as against the “broadcasting” which may involve any work or a programme coming under the Act's purview. In this connection, the definition of TV Channel as adumbrated in the impugned regulations will have to be seen. While the copyright does not make any reference to a TV Channel, it has been referred accordingly as such, only after obtaining permission for downlinking under the impugned regulations. Therefore, the TV channel has been understood in a very restrictive manner under the impugned regulations. Needless to state that the Cable Television Networks (Regulation) Act, 1995, also deals with the television channel as against the Copyright Act.
A party, who approbates and reprobates should not be shown any indulgence by the Court. Certainly, the law governing "issue estoppel" would also come into play. It also applies to the declaration made by the Court on the basis of the stand taken by the petitioners that it is a service provider under the TRAI Act.
Both the Cable Television Networks (Regulation) Act, 1995, and the TRAI Act are coming under entry 31 of List I of VII schedule. Therefore, if once competency is attributable to the Cable Television Networks (Regulation) Act, 1995, it is axiomatic that the same has to be extended to the TRAI Act as well. On the same analogy, a power conferred under the aforesaid Act cannot be imported into the Copyright Act through the amendments made. Merely because the petitioners are affected, the impugned regulation and the amendment would not partake the character of content. While there is no material to support the conclusion on content, as contended by the petitioners, the judgments inter se governing the field have not been taken note of.
Benefit of Tonnage Tax Scheme u/s 115VP/115VR - Offshore installations - Held that:- rigs are qualifying ships u/s 115VD - Since the learned CIT (Appeals) while deciding the issue in favour of the assessee has followed the decision of the Tribunal in assessee’s own case as well as the decision of Hon’ble Jurisdictional High Court, therefore, in absence of any contrary material brought to our notice by the learned Departmental Representative, we find no infirmity in the order of the learned CIT (Appeals) allowing the ground raised by the assessee. - Decided against the revenue.
Addition on account of difference in receipt as per TDS Certificate and amount shown in P&L A/c - Held that:- The assessee has properly reconciled the receipts vis-à-vis the amount shown in the profit and loss account. The learned Departmental Representative could not controvert the factual finding of the learned CIT (Appeals) on this issue. - No additions - Decided against the revenue.
Bad debts - amount written off - Held that:- The reason assigned by the AO that assessee is having business relationship with these parties in later years is incorrect because in subsequent years there were no such business relationship continued with M/s Frontier Drilling as evident from the various documents and in view of the Arbitration award. - Claim of bad debts allowed - Decided against the revenue.
Disallowance u/s 14A - no expenditure has been incurred for earning the dividend income - Held that:- when the assessee gets tonnage tax benefit under section 115VP / 115VR of the Act, the addition under section 14A read with Rule 8D is not at all required. - Decided against the revenue.
Corporate Insolvency Resolution Process - outstanding Operational Debt - Held that:- It is hereby pronounced that the "Moratorium" as prescribed under section 14 of the Code 2016 shall come into operation. As a result, Institution of any suit or parallel Proceedings before any Court of law are prohibited. The assets of the Debtor must not be liquidated until the Insolvency Process is completed. However, the supply of essential goods or services to the Corporate Debtor shall not be suspended or interrupted during "Moratorium Period". This direction shall have effect from the date of this Order till the completion of Insolvency Resolution process.
Exemption u/s 11 - charitable organization - Held that:- This Court is of the opinion that having regard to the ruling in India Trade Promotion Organization [2015 (1) TMI 928 - DELHI HIGH COURT] which was followed by the ITAT, no question of law arises. - Decided against the revenue.
Royalty - sale of software to Reliance Communications Limited - permanent establishment (PE) in India - whether sale of software is effectively connected to the PE of the Appellant in India - income attributable to the operations in India - Held that:- Issues have already been decided in favor of assessee - amounts are not taxable as income in the hands of the assessee.
Deemed divided u/s 2(22)(e) - amounts advanced to the assessee by the company - assessee claimed that same were relatable to chits - Held that:- it is clear that the assessee has received the bid amount as a customer of the company and not as a Director or the shareholder of the company. The business transaction of the company do not fall within the provisions of deemed dividend u/s 2(22)(e) of the Act. Therefore, the addition of ₹ 2,88,000 is deleted. - Decided in favor of assessee.
Deemed dividend - the loan taken was in respect of key man policy taken on the life of the assessee - Held that:- Since the nexus between the loan and advance to the assessee is clearly established and there is accumulated profit of the company available to such an extent, the same is taxable as deemed dividend u/s 2(22)(e) of the Act. - Decided against the assessee.
Application of rectification of mistake - Additions u/s 68 - allegation of bogus share capital - Held that:- The Tribunal have dealt with the issue threadbare and after confirming the findings of the CIT(A), dismissed both the appeals of the assessee and Revenue. There is no mistake, much less than an apparent mistake, in the order passed by the Tribunal. - In the result, the miscellaneous application filed by the assessee is dismissed. - Decided against the assessee.
Claim of depreciation on non compete territory rights - Held that:- As Co-ordinate Bench has given decision in favour of the assessee and against the revenue, therefore, respectfully following the above said Co-ordinate Bench order and in our considered opinion, ld. CIT(A) has passed detailed and reasoned order. Therefore, we are not incline to entertain the appeal of the revenue. - Decided against the revenue.
Penalty u/r 26 of CER, 2002 - it was alleged that appellant has supplied the raw material to one M/s. Goyal Pipes P Ltd., who have used the same for further manufacture of their final product which stand cleared by them without payment of duty - Held that:- Identical issue decided in the case of PRYASH STEEL KAMAL KUMAR AGRAWAL M/S KAILASH TRADERS VERSUS CCE & ST, RAIPUR [2018 (5) TMI 814 - CESTAT NEW DELHI], wherein the penalty was set aside by holding that there is virtually no evidence to show that such entries relate to the actual transportation and supply of the raw material to the present appellant.
Penalty set aside - appeal allowed - decided in favor of appellant.
Non-representation on behalf of assessee-Appellants - Non-communication of change of address - Held that:- It appears that appellant are not serious in pursuing their appeal - it may be mentioned that as per the maxim VIALATIBUS ET NON DORMIENTIBUS JURA SUB VENIUNT, law helps those who are vigilant and not those who go to sleep.
The appeal is dismissed for default with liberty to come again for recalling this order subject to satisfying the reason for the default, but within the prescribed time.
The Delhi High Court dismissed the appeal as the question of remand was not pressed. All pending applications were disposed of, and the contentions of the parties were kept open.
Dismissing the appeal of the assessee vide his impugned order passed ex-parte - Held that:- We accordingly impose a cost of ₹ 5,000/- on the assessee for the non-compliant and non-cooperative approach shown during the course of appellate proceedings before the CIT(A) resulting into ex-parte order and direct the assessee to pay the said cost to Prime Minister’s Relief Fund. Subject to the said payment, the impugned order of the CIT(A) passed ex-parte is set aside and the matter is restored to the file of the A.O. for deciding the issues relating to the two additions made to the total income of the assessee afresh after giving the assessee one more opportunity of being heard.
Arbitration award - Section 34(5) of the Arbitration and Conciliation Act, 1996 - issuance of prior notice to the party - Held that:- Section 34(5) was inserted by way of amendment under the Arbitration and Conciliation (Amendment) Act, 2015, made effective from 23.10.2015. Section 34(5) was inserted by way of amendment under the Arbitration and Conciliation (Amendment) Act, 2015, made effective from 23.10.2015 - A perusal of the aforesaid provision under Section 26 of the Amendment Act, it is seen that arbitral proceedings which have commenced in accordance with the provisions of Section 21 of the principal Act would remain unaffected by the Amendment Act unless the parties otherwise agree. The terms and conditions of the Contract in question are governed under the General Conditions of Contract, 1998.
The application filed by the appellants under Section 34 of the Act was not maintainable in the absence of compliance of the mandate of Section 34(5) of the Act - appeal dismissed.
Condonation of delay in filing petition - relevant time - the copy of the petition(s) was served on the respondents for the first time on 19.04.2018 - case of respondents is that as the petitions could not be filed without service of a copy thereof on the respondents, the date of filing of the present petitions has to be considered as 19.04.2018 - the petitions were filed beyond the period of 30 days after the expiry of three months from the date of the receipt of the Arbitral Award - condonation of such delay - Section 34 (5) of the Arbitration and Conciliation Act, 1996.
Held that:- Section 34 (5) of the Act clearly show that the service of a prior notice on the other party is a mandatory requirement before filing of an application under Section 34 of the Act. Not only is such notice to be given but also the application itself has to be accompanied by an affidavit of the applicant endorsing the compliance of said requirement. This requirement of the service of prior notice therefore, cannot be said to be a mere formality or directory in nature.
Taking the date of filing as 19.04.2018, the petitions would be beyond the period of 30 days after the expiry of three months from the date of the receipt of the Arbitral Award and this Court would not have the power to condone the delay even if the petitioner is able to make out a sufficient cause for this delay - It was incumbent on the petitioner to have served a copy of the petition(s) on the respondents before filing the present petition. In absence of such prior notice to the respondents, the filing itself cannot be considered as valid in law, so as to stop the period of limitation.
Disallowance u/s. 14A r.w.r. 8D - Held that:- As seen from the order of the AO as well as the CIT(A), there is no fin ding that assessee has incurred any expenditure for earning the said dividend income. There was no diversion of borrowed funds, hence there is no disallowance interest under Rule 8D(2)(ii).
Coming to disallowance under Rule 8D(2)(iii) disallowance of ½% of average value of investment, some proportionate expenditure can be disallowed but in no case, it should exceed the amount earned claiming exemption - the disallowance under Rule 8D cannot exceed the dividend income earned and claimed as exempt. Therefore, the disallowance worked out under Rule 8D(iii) being administrative expenditure is restricted to the amount of dividend earned. AO is directed to modify accordingly. Ground is partly allowed.
Penalty imposed u/s 271(1)(c) - deposit of surplus funds in FDRs - Held that:- When the assessee has accepted the quantum, paid the taxes as well as interest pursuant to the decision rendered by Hon’ble Uttarakhand High Court and confirmed by Hon’ble Apex Court whereby deposit of surplus funds in FDRs are held to be not covered by Doctrine of Mutuality, we are of the considered view that it does not amount to concealment of particulars of income and furnishing of inaccurate particulars of income particularly when all the necessary details were already furnished by the assessee at the time of filing original return in accordance with the settled principles of law as per decision rendered by Hon’ble Apex Court in Chelmsford Club (2000 (3) TMI 4 - SUPREME COURT) case
AO has failed to make out the case of concealment of income or furnishing of inaccurate particulars of such income by the assessee rather it is a case of imposing penalty on the basis of decision rendered by the Hon’ble Apex Court in Bangalore Club (2013 (1) TMI 343 - SUPREME COURT) case which was not in the notice of assessee at the time of filing the return pursuant to the notice u/s 148 of the Act sufficient to attract the provisions contained u/s 271(1)(c), so we find no illegality or perversity in the deletion of penalty made by the ld. CIT (A). Consequently, all the aforesaid appeals filed by the Revenue are hereby dismissed
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