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Showing 441 to 460 of 754 Records
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2020 (5) TMI 314
Dishonor of Cheque - non-bailable warrant - offence u/s 138 of NI Act - validity of order of summon - HELD THAT:- A dishonour would constitute an offence only if the cheque is returned by the bank ‘unpaid’ either because the amount of money standing to the credit of the drawer’s account is insufficient to honour the cheque or that the amount exceeds the amount arranged to be paid from that account by an agreement with that bank. Now, for an offence under Section 138 NI Act, it is essential that the cheque must have been issued in discharge of legal debt or liability by accused on an account maintained by him with a bank and on presentation of such cheque for encashment within its period of validity, the cheque must have been returned unpaid. The payee of the cheque must have issued legal notice of demand within 30 days from the receipt of the information by him from the bank regarding such dishonor and where the drawer of the cheque fails to make the payment within 15 days of the receipt of the aforesaid legal demand notice, cause of action under Section 138 NI Act arises.
It is not disputed that neither in the complaint nor in the statement of the complainant recorded under Section 200 Cr.P.C., is it mentioned as to on which dates, he has demanded for refund of his money from the applicant, on which date he had presented the alleged cheques in the bank for encashment - The complainant has also not disclosed the date on which he had sent the legal notice to the applicant through his advocate and the date of service of notice. The complainant has also disclosed the date i.e. 3rd July, 2014 on which the dishonoured cheques along with return memo showing “insufficient balance” amount in the account of the applicant, has been received.
Thus, it is not clear that one of main ingredient i.e. date of service of notice from which the date the cause of action arises i.e. date of bank return memo as per the provisions of Section 138 N.I. Act is completely missing in the present case - As per Section 138 read with Section 142 N.I. Act, the period of complaint being filed from the date of service of notice i.e. within one month is also not complied in the present case.
In the impugned summoning order also the concerned Magistrate has only recorded the date on which the alleged cheques were dishonoured i.e. 3rd July, 2014 and the date of legal notice i.e. 14th July, 2014, which was sent to the applicant but he has not recorded the date on which the legal notice has been served from which the date the cause of action would arise - In view of the provisions of Sections 138 read with Section 142 N.I. Act, the main ingredients are not complied with by the complainant while filing such immature complaint, which is liable to be quashed.
Application allowed.
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2020 (5) TMI 313
Dishonor of Cheque - stay of fine - effect of amendment in Section 148 of the N.I. Act - HELD THAT:- With the objective of reducing delay in proceedings pertaining to dishonour of cheques and to provide interim relief to the payee in such cases, the Negotiable Instruments (Amendment) Bill of 2017 was tabled before the Lok Sabha.
In the wake of current scenario, The Negotiable Instruments (Amendment) Act, 2018 passed by both the Houses (Lok Sabha on July 23, 2018; Rajya Sabha on July 26, 2018; and notified on August 02, 2018) has come as a breather for the aggrieved Drawees. Nonpayment because of cheque dishonor contribute majorly towards business inconsistencies leading not only to an cash flow, but also chain of inconveniences/incalculable losses forced upon them involuntarily - Further, delayed justice owing to lengthy court procedures add to the woes. Therefore, the Amendment Act aims to give potency in enforcing quick relief and to act as a deterrent for future cases by enhancing credibility of cheques as a negotiable instrument.
The Drawer of the cheque is made liable to prosecution and partial payment upon dishonour of the cheque implying that the provisions are punitive as well as compensatory, that is, the punitive aspect leading to compensation. It can be ascertained that the Legislature has made a remarkable move by bringing this amendment in the interest of speedy justice.
Thus, the applicability of the provision under Section 148 of the N.I. Act is mandatory. Deposit of fine not less than 20% is condition precedent for admission of appeal and provision under Section 357 (2) Cr.P.C. are not made applicable during admissibility and pendency of appeal. Section 148 of the N.I. Act can be applied to complaint filed prior to 1.9.2018 - there are no reason to interfere with the impugned order dated 23.10.2019 passed by the appellate sessions court directing the Appellants to deposit 30% of the amount of fine/compensation pending appeals.
Revision dismissed.
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2020 (5) TMI 312
Dishonor of Cheque - insufficiency of funds - discharge of legally enforceable debt, arising from a chitty transaction - offence u/s 138 of NI Act - principles of natural justice - HELD THAT:- The Court below over looked the fact that the accused was the guarantor to the chitty transaction. The chitty transaction by the husband of the accused is not in dispute. On the other hand, the trend of the cross examination showed that PW1 was not cross examined at length and except making a vague suggestion that the cheque was not handed over by the accused, no further defence was setup - There is nothing on record to show that the husband and wife were at logger heads or that they were living separately. Her version that, the signature on the cheque was forged by the husband was not seen put to PW1 in cross examination. On the other hand, her contention is falsified from the very fact that, she has gone to the extent of stating that even the postal acknowledgment produced along with the complaint was forged and produced by the complainant themselves.
It seems that the court below did not correctly evaluate the evidence in its correct perspective. The court below did not take into consideration Exts.P3 to P6 documents - the matter needs to be considered afresh by the court below on the basis of the evidence already on record and the further evidence, if any, which both sides propose to adduce - Matter on remand.
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2020 (5) TMI 311
Dishonor of Cheque - offence u/s 138 of NI Act - rebuttal of presumption - applicant has been summoned to face trial - applicant has submitted that the initiation of the present proceeding on the basis of the complaint filed by the opposite party no.2 is an abuse of the process of law as there is no strict compliance of provision of Section 138 of Negotiable Instrument Act - HELD THAT:- In view of the catena of the decisions of the Apex Court and also passed by this court in SMT. REENA TRIPATHI VERSUS STATE OF U.P. AND ANOTHER [2014 (7) TMI 1323 - ALLAHABAD HIGH COURT] wherein it has been held that after service of notice if the amount of disputed cheques is not paid the cause of action accrued to the complainant to file the complaint against the drawer of the cheque. The interim order dated 31.3.2009 passed in favour of the applicant staying the proceeding of the summoning order dated 2.6.2007 is liable to be vacated and the petition be dismissed.
The disputed question of fact cannot be dealt with in exercise of power under Section 482 Cr.P.C. in view of the catena of decisions of the Hon'ble Apex Court; the denial of the applicant that the cheque has not been issued by him and his cheque was lost and in respect of which Bank has also been informed; that the complaint is pre mature, the mandatory requirement of service of notice is lacking; the complaint was filed pre mature are all disputed questions of fact, which can only be gone into during the course of trial. The complaint was filed along with the oral and documentary evidence, which have already been referred to in the preceding paragraph, prima facie constitutes offence against the applicant.
The cheque dated 29.1.2007 of ₹ 10,00,000/- given by the applicant was deposited by the complainant on 31.1.2007 in his bank at Canara Bank, Roorki Road, Muzaffar Nagar, which was returned by the bank with the endorsement of "insufficient fund" on 9.2.2007 along with memo dated 14.2.2007, which was received by the complainant on 26.2.2007, hence a notice was given with respect to the dishonour of cheque by the complainant through registered post on 9.3.2007, which was received at the address of the applicant and even after expiry of 15 days when the required amount mentioned in the cheque was not returned nor any reply was given, hence the complaint was filed on 26.4.2007 by the opposite party no. 2. Merely not mentioning the date of receipt of notice or service of notice by the complainant is a disputed question of fact, which shall be considered by the trial court.
In view of the Section 27 of the General Clauses Act it is not necessary to mention in the complaint that service of notice was evaded by the accused or that the accused has stated about the notice to be un-served when the notice was sent by registered post at the address of the applicant, the mandatory requirement of issue of notice under Clause (b) of proviso to Section 138 of the Act stands complied with, therefore, the cognizance of the complaint under Section 138 of the Act has been taken as the court was satisfied prima facie that the case is made out under that section and that the procedural requirement has been complied with. To rebut presumption about the service of notice or that the address was incorrect or the filing of complaint prior to the expiry of notice period that would be considered by the trial court at the appropriate stage.
The application is bereft of any merit accordingly dismissed.
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2020 (5) TMI 310
Depreciation on Digital Content/Animation Software developed - held by assessee as an ‘asset’ which is used in various films by assessee - Eligible to depreciation @ 60% or 25% - definition of computer software - HELD THAT:- The scope of ‘Information Technology Software’ as is referred to in Hon’ble Supreme Court judgment in assessee’s own case [2006 (5) TMI 90 - SUPREME COURT] was in context of Customs Laws which was very vide definition and hence we cannot draw analogy in the 1961 Act read with 1962 Rules.
Digital contend developed by assessee can be equated with computer program is far fetched but rather it is a copyrighted material developed by assessee which is stored in computer. This digital content was manipulated by assessee to be used in different films but still it cannot be categorized at higher pedestal of being termed as ‘computer program’ rather it still retains the character of copyrighted material being intangible asset and in our considered view, the assessee is eligible for depreciation @ 25% as these copyrighted material developed by assessee being ‘Digital Content’ which is used by the assessee in various films etc. - Decided against assessee.
Disallowance u/s14A r.w.r. 8D(2)(iii) - expenses incurred by assessee in relation to earning of an exempt income - AO disallowed the expenses by invoking Rule 8D(2)(iii) by applying 0.5% of the average investments - HELD THAT:- We find merit in contentions of the assessee that the investments in Indian companies which did not yielded exempt income during the year cannot be included for computing disallowance of expenditure u/s 14A read with Rule 8D of the 1962 Rules and we are restoring the matter back to the file of the AO for verification of the contentions of the assessee and to re-adjudicate the matter on merits in accordance with law. Thus, all those investments in indian companies which did not yielded exempt dividend income during the year shall be excluded while computing disallowance of expenditure u/s 14A read with rule 8D(2)(iii) of the 1962 Rules.
Case of ACIT v. Vireet Investment Private Limited [2017 (6) TMI 1124 - ITAT DELHI] is relevant. This ground partly allowed for statistical purposes
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2020 (5) TMI 309
Validity of action of the respondent No.2 to stop the goods and conveyance - principles of natural justice - HELD THAT:- The order in form GST MOV-11 has already been passed by the concerned authority. It is suggestive of the fact that the final order of confiscation of the goods and conveyance has been passed. In such circumstances, we decline to interfere in the matter. We relegate the writ applicant to prefer a statutory appeal under Section 107 of the G.S.T. Act before the appellate authority.
It is clarified that pending the appeal that may be filed by the writ applicant, it shall also be open for the writ applicant to prefer an application under Section 67(6) of the Act for the provisional release of the goods upon execution of a bond and furnishing of a security or on payment of applicable tax, penalty and interest payable. If any such application is filed, the concerned authority shall look into the same and pass an appropriate order in accordance with law within a period of one week from the date of receipt of such application.
Application disposed off.
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2020 (5) TMI 308
Provisional attachment of FDRs - search action under Section 132 - HELD THAT:- Having considered the suggestions put forward by both sides we dispose of this writ application with the following directions :
(i) The impugned order of provisional attachment dated 10.12.2019 shall continue to operate in accordance with law.
(ii) As the bank accounts have not been freezed or attached by the department, it shall be open for the writ applicant to operate such bank accounts / limits in accordance with law.
(iii) If the department wants to initiate any fresh action including the action of further provisional attachment, it shall be open for them to do so in accordance with law.
With the aforesaid directions, this writ application stands disposed of. It shall be open for the writ applicant to inform the concerned department of the order passed by this Court by E-mail.
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2020 (5) TMI 307
Validity of notice u/s 143(2) - Jurisdiction of AO New Delhi on the assessee within the meaning of Sec. 120 - transfer of jurisdiction - ITO Ward 23(4) New Delhi claimed jurisdiction on the ground that PAN was still lying with the said ward and on the said basis, the assessment has to be made by him for AY 2008-09 - HELD THAT:- In the present case, there is gross violation of the procedure laid down in the Act. For seeking transfer of jurisdiction, there is a prescribed procedure in Sec. 127 and the CIT-8 had to refer the issue to CIT-13 explaining the reasons as to why he wants to get the case transferred to him. A regular order u/s 127 had to be passed by Pr.CIT-13 and only then the jurisdiction could be transferred from Ward 39(4) to Ward 23(4).
On receipt of notice dated 20.07.2010 from ITO Ward-23(4), the assessee filed his objection on 05.08.2010. Even on receipt of this objection, the AO did not act on it and no effort was made to comply with the statutory provisions for acquisition of proper jurisdiction in accordance with law. Thus, the AO without deciding the issue of jurisdiction passed the Assessment Order u/s 144 which is not as per the mandate of the Income Tax Act, 1961.
Assessee has intimated the change of address within the prescribed time and the assessee has taken all the necessary steps to object the jurisdiction which was not at all considered by the Assessing Officer at the relevant time. In fact, the said AO does not have any jurisdiction. Thus, the Assessment Order itself becomes null and void ab initio. - Decided in favour of assessee.
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2020 (5) TMI 306
Penalty u/s 271(1)(c) - Defective notice - surrender of income was not made by assessee on his own volition but only after the same has been detected by the AO - HELD THAT:- Inappropriate words in the penalty notice has not been struck off and the notice does not specify as to under which limb of the provisions, the penalty u/s 271(1)(c) has been initiated, therefore, we are of the considered opinion that the penalty levied u/s 271(1)(c) is not sustainable and has to be deleted. Although the Ld. DR submitted that mere non-striking off of the inappropriate words will not invalidate the penalty proceedings, however, the decision in the case of SSA’S Emerald Meadows [2016 (8) TMI 1145 - SC ORDER] where the SLP filed by the Revenue has been dismissed is directly on the issue contested herein by the Assessee. Further, when the notice is not mentioning the concealment or the furnishing of inaccurate particulars, the ratio laid down in case of M/s. Sahara India Life Insurance Company Ltd. [2019 (8) TMI 409 - DELHI HIGH COURT] will be applicable in the present case. - Decided in favour of assessee.
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2020 (5) TMI 305
TP Adjustment - selection of MAM - CUP method against the TNMM as the most appropriate method - HELD THAT:- Hon’ble Jurisdictional High Court of Punjab & Haryana in NISSIN BRAKE INDIA PVT. LTD. . [2020 (1) TMI 1190 - PUNJAB AND HARYANA HIGH COURT] held that there is no need to deviate from TNMM followed by the assessee to CUP method followed by the revenue.
Hence, keeping in view the judgment above we hereby direct the revenue to determine adjustments considering the TNMM as the most appropriate method.
TPA - Comparable selection - rejection of one comparable selected by the assessee in their TP documentation and selection of five comparables by the revenue in their TP study - HELD THAT:- Since, the business of the assessee is “ core auto components”, we hold that it cannot be compared with an entity which is in the business of “ non- core auto components”.
Capacity Utilization Adjustment - HELD THAT:- We have gone through the record and the orders of the Tribunal for the earlier three assessment years i. e. assessment yeas 2010-11, 2012-13 and 2013-14 wherein the capacity utilization adjustment has been duly granted. Keeping in view the industrial standing of the comparable, we hereby direct that the same benefit may be accorded in the instant year.
Brought forward losses - HELD THAT:- AO is directed to consider relief on account of brought forward losses as per the Income Tax Act after taking into consideration the business losses and unabsorbed depreciation as per the earlier returns filed by the assessee.
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2020 (5) TMI 304
Reopening of assessment u/s 147 - capital gain of sale of land - whether the said land is a capital asset u/s 2(14) or is an agricultural land entitling assessee to exemption? - conversion of the land into residential area - HELD THAT:- The assessee has not furnished any evidence even before us to prove that agricultural operations were carried on the said land but only bald statement is made that water melon and pumpkin was grown. The assessee has filed additional evidences before us to contend that Government of Tamil Nadu vide Notification in G.O. Ms No. 153 dated 20.06.2013 had included Thaiyur Village in the Mamallapuram Local Planning Area , which is post the said previous year. The said land falls within Chengalpattu District , which falls within jurisdiction of CMDA and it is to be verified from which date the said land came within CMDA as there are master plans which were revised from time to time .
There is a need for detailed verification and enquiry in the instant case with respect to classification of said land , whether it falls within jurisdiction of CMDA during relevant period or not, whether agricultural activities were conducted by assessee on the said land or not, whether the said land is a capital asset u/s 2(14) or is an agricultural land entitling assessee to exemption etc. , before arriving at the conclusion as to chargeability to tax of the capital gains earned by assessee on the sale of said land. The assessee is claiming exemption and hence onus is on assessee to prove that its income falls within four corners of exemption provisions as are contained in the 1961 Act.
Matter needed to go back to the file of the AO for framing denovo assessment on merits of the issue as well on legal/jurisdictional ground raised by assesse wrt reopening of the concluded assessment u/s 147 - Decided in favour of assessee for statistical purposes.
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2020 (5) TMI 303
Addition u/s 40A(2)(b) - payment to the persons specified - computing the profit of the Joint Venture @4% of the gross receipts - HELD THAT:- As decided in M/S KEC SIDHARTH JV, M/S KEC PLR KPIPL JV [2018 (4) TMI 1747 - ITAT DELHI] AO made the addition by invoking the provisions of Section 40A(2)(b) of the Act which are applicable to the expenses considered to be excessive or unreasonable having regard to the fair market value of the goods/services or facilities for which the payment is made. However, in the instant case, the AO estimated the profit of the assessee and determined the income, nowhere he doubted the expenses incurred by the assessee. Therefore, AO was not justified in making the addition by invoking the provisions of Section 40A(2)(b) of the Act which are applicable to the expenditure and not to the receipts and the ld. CIT(A) rightly deleted the same. - Decided in favour of assessee
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2020 (5) TMI 302
Penalty u/s 271(1)(c) - addition on account of “Short Term Capital Gains” against the amount declared under the head “Long Term Capital Gains” - HELD THAT:- Co-ordinate Bench of ITAT [2014 (6) TMI 933 - ITAT DELHI] in the case of the assessee has deleted the addition made on account of Short Term Capital Gains. The matter was further remanded back to the AO for examination of re-investment of LTCG in the new asset. Since as on date, the quantum addition stands deleted by the Tribunal, the penalty levied on such income is hereby set aside with liberty to revive the proceedings based on the outcome of the re-investment of the Long Term Capital Gains.
Short Term Capital Gain on house property after claiming repair expenses - CIT (A) confirmed the disallowance made by the AO on the grounds that even during the appellate proceeding, the assessee was unable to justify the claim by producing relevant documentary evidence in support of repair expenses - HELD THAT:- Assessee has made payment to four parties on account of the repairs undertaken in the property which has been sold for which the Short Term Capital Gains have been offered to tax.
CIT (A) would have been inadvertently ignored the payments made while confirming the disallowance in absence of anything contra brought by the revenue about the payment of the repair charges to the four persons mentioned above. Hence, we hereby direct the disallowance made by the revenue is liable to be deleted.
Addition u/s 14A - suo moto disallowance by assessee - HELD THAT:- Provisions of Section 14A(2) have not been adhered to by the revenue and keeping in view the fact that the assessee suo moto has disallowed nearly 30% of the exempt income received, we find that the invocation of Rule 8D in this case is legally not tenable. The disallowance made is directed to be deleted. In the result, the appeal of the assessee is allowed.
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2020 (5) TMI 301
Unexplained investment in the commercial property by assessee HUF - deduction u/s 80C denied - AR submitted that the entire family is earning a handsome amount either in individual parity or as HUF and entire cash amount is out of disclosed & declared sources - HELD THAT:- CIT(A) observed that since no withdrawal was shown in the return of income by the HUF, therefore, it is difficult to believe that the HUF has contributed for the household expenses of the assessee. Besides that the CIT(A) also rejected the contention of the assessee that the assessee required the cash in hand for his probable medical expenses. But the fact remains that the assessee has also explained the introduction capital of ₹ 8,25,505/- as capital by stating that he had received money from his father in law of ₹ 5,00,000/-, amount transferred from minor son saving bank account of ₹ 1,41,800/-, amount transferred from minor daughter’s saving account of ₹ 23,000/-, amount transferred from wife’s saving account of ₹ 63,000/- apart from dividend income and mutual fund receipts.
AO as well as CIT(A) both did not look into the evidences brought on record by the assessee. The CIT(A) also has not given any cogent reason as to why said addition sustains. In fact, the observation of the CIT(A), that no documentary evidence was shown in respect of father in law and wife is incorrect and needs to be verified. Therefore, it will be appropriate to remand back this matter to the file of the Assessing Officer to verify the evidences which were produced by the assessee before the CIT(A). Ground allowed for statistical purpose.
CIT(A) was rightly rejected the deduction u/s 80C of the Act.
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2020 (5) TMI 300
Penalty u/s 27ID - cash loans exceeding ₹ 20,000 from agriculturists living in village areas - HELD THAT:- 2nd proviso to section 269SS lays down that the provisions of this section shall not apply to any loan or deposit or specified sum, where the person from whom the loan or deposit or specified sum is taken or accepted and the person by whom the loan or deposit or specified sum is taken or accepted, are both having agricultural income and neither of them has any income chargeable to tax under this Act
Contention of the Ld. AR that since the creditor had given the loan from their agricultural income and the borrower was also engaged in agricultural activity, the provisions of section 269SS are not attracted, has not been verified by the Assessing Officer as well as by the CIT(A) from the perusal of the evidences. Thus, the revenue authorities failed to look into the evidences produced before them and did not verify the same in context of Section 269SS
Remand back this issue to the file of the AO for proper adjudication - Appeal of the assessee is partly allowed for statistical purpose.
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2020 (5) TMI 299
Income earned by sale of land - business income or Long Term Capital Gains - whether the land in question is investment or stock-in-trade irrespective of the fact whether the books of accounts have been wrongly accounted or whether the capital gains have been wrongly offered to tax? - assessee has taken plea that the land has been sold only on account of the notice received from the revenue department to surrender the land as it was an encroachment on the Gaon Sabha Land - HELD THAT:- The notice was issued in the year 1997 hence cannot be given any relevance with regard to determination for the issue before us. The fact that the land in question has been sold after obtaining NOC from the ADM, South District, New Delhi on 24.01.2011. We find that the main objects of the company are to acquire purchase take on lease are otherwise any land building, structures plot to act as real estate agents in connection with buildings schemes and also to be colonizers to sale plots and flats. Having acquired the land as stock-in-trade, the land continued to be held for business purpose and continued to be shown as closing stock for all the years.
The assessee is into the business of acquiring and sale of plot and colonizers. On going through the Memorandum and Articles of Association, conduct and business affairs of the assessee, and on perusal of the books of accounts of the assessee, it cannot to be said to be an income arising out of capital gains and has been rightly treated as business income by the ld. CIT (A).
Whether the capital gains are eligible to avail its exemption? - Since, the income earned has been already adjudicated on merits to be taxed as “business income”, it is hereby clarified that the treatment proposed by the assessee to consider the proceeds of the sale of land under the head “Long Term Capital Gains”and subsequent exemption from taxation cannot be held to be valid in the eyes of law.
Disallowance u/s 40(a)(ia) - CIT-A uphold addition on the grounds that the assessee is not a new company and been in the business of land transactions from 1997 and the provisions of TDS are clearly defaulted by the assessee - HELD THAT:- In the absence of any evidences contra, putforth by the assessee, we hereby decline to interfere with the order of the ld. CIT (A) on this issue. - Decided against assessee.
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2020 (5) TMI 298
Penalty u/s 271(1)(C) - Non specification of charge - whether the penalty is going to be levied for concealing particulars of income or furnishing of inaccurate particular of income? - HELD THAT:- Notice issued by the Assessing Officer u/s 274 r.w.s 271(1)(c) of the Act to be bad in law as it did not specify which limb of section 271(1)(c) of the Act the penalty proceedings had been initiated i.e. whether for concealment of particulars of income or furnishing of inaccurate particulars of income.See M/S SSA'S EMERALD MEADOWS [2016 (8) TMI 1145 - SC ORDER] - Decided in favour of the assessee.
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2020 (5) TMI 297
Unexplained cash credit u/s 68 - Assessee claimed taking loan and payment of interest thereon - HELD THAT:- Explanation of assessee should be acceptable so far as first instalment loan of ₹ 20 lakhs is concerned and to that extent, the loan of ₹ 20 lakhs stands explained. Regarding second credit of ₹ 20 lakhs, we find that to the extent of ₹ 9 lakhs received from Vishal Transport, the explanation should be acceptable.
Cash deposit of ₹ 11 lakhs (₹ 8 lakhs + ₹ 3 lakhs), there is requirement of investigation into the source of cash deposits in the bank account of Shri Dinkar Shankar Kumbhar, Prop. Shri Swami Bricks.
Accordingly, we are of the opinion that the matter should be remanded to the file of Assessing Officer for verification of assessee’s arguments i.e. cash withdrawals from the account of the assessee constitutes source of cash of ₹ 11 lakhs. The Assessing Officer shall give reasonable opportunity of hearing to the assessee and in case the assessee files any evidences, explanations, etc. should accept the same and make re-assessment on this issue. Thus, grounds raised by assessee are partly allowed for statistical purposes.
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2020 (5) TMI 296
Rectification u/s 254 - obvious and patent mistake - Cost of acquisition AND deduction claimed u/s.54F - HELD THAT:- Core of all these authoritative pronouncements is that power for rectification under section 254(2) of the Act can be exercised only when mistake, which is sought to be rectified, is an obvious and patent mistake, which is apparent from the record and not a mistake, which is required to be established by arguments and long drawn process of reasoning on points, on which there may conceivably be two opinions. For fortifying this view, we make reference to the decision of the Hon'ble jurisdictional High Court in the case of ACIT Vs. Saurashtra Kutch Stock Exchange Ld.[2008 (9) TMI 11 - SUPREME COURT].
Hon'ble Jurisdictional High Court in the case of CIT Vs. Ramesh Electric & Trading Company [1992 (11) TMI 32 - BOMBAY HIGH COURT] has held that the scope of section 254(2) is limited to rectification of mistake apparent from record itself and not rectification in error of judgment - in the guise of rectification, the assessee is seeking review of the order of Tribunal, which is beyond the scope of powers as envisaged u/s. 254(2) of the Act. Miscellaneous Application filed by assessee is dismissed.
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2020 (5) TMI 295
Deduction u/s 36(1)(viia) - provision created for bad and doubtful debts u/s 36(1)(viia) which included a provision in respect of standard assets disallowed - As per AO deduction u/s 36(1)(viia) is not allowable with respect to the provision in respect of standard assets as according to him, it was good and recoverable and provision made on such assets cannot be considered to be a provision for bad and doubtful debts - HELD THAT:- As relying on BELLAD BAGEWADI URBAN SOUHARD SAHAKARI BANK NIYAMIT VERSUS THE COMMISSIONER OF INCOME TAX (APPEALS) BELAGAVI [2018 (3) TMI 737 - KARNATAKA HIGH COURT] RBI guidelines prescribes the provision on standard assets from the year ended March 31, 2000 directing the banks to make a general provision of a minimum of 0.25% on standard assets.
Decision rendered by the CIT is unjustifiable for the reason that assessee is bound by the guidelines issued by the Reserve Bank of India. Any contrary view taken by the Income Tax Authorities would disentitle the assessee from claiming deduction u/s 36(1)(viia).
Assessee is eligible for deduction and we thus, direct the AO. - Decided in favour of assessee.
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9911796707
