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Showing 501 to 520 of 1183 Records
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2021 (6) TMI 683
Refusal to issue customs clearance to the High Alumina Refractory Cement imported - demand for production of BIS certificate for the goods imported by the petitioners - HELD THAT:- According to the scheme of the BIS Act and its Rules, the Bureau of Indian Standards is a National Standard Body having technical expertise to establish national standards for goods or articles, process, system or service etc. and it by itself has no power to enforce the implementation. On the other hand, the standards fixed under Section 10 by the Bureau, have to be notified by the Central Government and thereafter, if it considers that the standards established in respect of goods and articles mentioned in Section 14 or Section 16 shall require compulsory conformity, the Central Government shall make a legislation or issue specific order in that regard.
Notification dated 14.05.2018 was issued in terms of Rule 7(1)(b) of the Bureau of Indian Standards Rules, 1987. Under Rule 7(1)(a), the Bureau is obligated to establish Indian standards in relation to any article or process and it can amend, revise or cancel the standards so established. As per Rule 7(1)(b), all standards, their revisions, amendments and cancellations shall be established by notification in the Official Gazette. So, in terms of Rule 7(1)(b), the standard earlier established in the year 2011 for IS:15895:2011 HARC was revised on 09.05.2018 and the same was notified in the Official Gazette by the Central Government. As per Rule 7(7)(b), this establishment of standard is only voluntary to make it available to the public, but its conformity is not mandatory unless it is referred to in a legislation or so pronounced by a specific order of the Government.
As rightly contended by the learned senior counsel for the petitioners, the respondents have not produced such a legislation or Gazette notification issued by the Central Government mandating that the standard established by BIS for IS:15895:2018 shall be compulsorily followed. Hence, the notification dated 14.05.2018 will not advance the contention of the respondents. For the same reason, another contention of the respondents that the standard specification notification issued by BIS should be deemed to be part of Appendix III of Import Policy and thereby, the import of HARC shall be supported by BIS certification cannot be accepted.
The respondent authorities are not legally justified in demanding production of BIS certificate for the goods imported by the petitioners in both the writ petitions - Petition allowed - decided in favor of petitioner.
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2021 (6) TMI 682
Grant of Anticipatory Bail - right to operate the locker - allegation against petitioner is that she operated the locker which was in the name of her husband Sahil Jain and removed certain crucial documents - HELD THAT:- Prime facie, there are serious and specific allegations leveled against the petitioner in the FIR in question for which her custodial interrogation would be imperative, more so, since she allegedly removed crucial documents having a direct link with the proceedings, which were pending against her and her husband under the CGST Act.
Petition dismissed.
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2021 (6) TMI 681
Seeking release of pending refund of IGST - HELD THAT:- The pre-conditions set out under Rule 96 of the Central Goods and Services Tax Rules, 2017, which are production of certificates and documents such as the export manifest or export refund covering, the number and date of the shipping bill or bills of export and a valid return in Form GSTR 3 or 3B as the case may be, have to be complied with by the assessee concerned.
In this case the petitioner appears to, prima facie, have produced the above documents under cover of its communication dated 24.07.2018. In any event, this is a question of fact that would have to be verified by the Assessing Authority - while the legal issue stands decided in favour of the petitioner, let the factual aspect of production of documents in terms of Rule 96 of the CGST Rules be looked into by Assessing Authority and orders passed prior to the next date of hearing on representation of the petitioner dated 17.02.2020.
Petition disposed off - List on 15.07.2021.
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2021 (6) TMI 680
Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - only part payment of amount declared - HELD THAT:- The petitioner cites the difficulties caused by the on-going COVID-19 pandemic to justify the delay in making the remittances. As far as W.P.Nos.14451 and 14497 of 2020, wherein Form 3 has been issued on 27.12.2019 and the 30 day period available for remittance is till January, 2020, the reliance upon the pandemic would not come to the aid of the petitioner. As far as W.P.No.14454 of 2020, wherein Form 3 has been issued on 27.02.2020 and time was available till the end of March, 2020, the lock down that was imposed on 25.03.2020 may come to the aid of the petitioner.
W.P.Nos.14451 an 14497 of 2020 are dismissed - List W.P.No.14454 of 2020 on 21.06.2021 for further hearing.
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2021 (6) TMI 679
Intent to evade service tax or not - activities during the period 16.07.2001 to 31.03.2005 - advances received during the period 16.06.2005 to 31.12.2005 - justification for invocation of extended period of limitation for demanding of service tax, as contended? - HELD THAT:- The respondent had applied and obtained registration under various categories of services as guided by the authorities of the appellant-Revenue. It is also evident that the authorities, who informed the respondent that its activities would get covered by photography service, scientific or technical constancy service and commercial training and coaching service etc., are guided by Revenue considerations alone and they have not kept in mind the nature of activity undertaken by the respondent- NRSA and area of operation of its activities, apart from the important role it plays in the affairs of this nation.
The appellant-Revenue authorities initially directed the respondent-NRSA to obtain registration under the three categories which was duly adhered to by obtaining registration on 14.02.2005. Upon obtaining registration, the appellant-Revenue saddled the respondent-NRSA with the show cause notice for the period prior to registration by invoking the provisions of Section 73(1)(a) of the Finance Act. To justify the action of invocation of extended period of limitation, it has been stated that since, the respondent has been rendering taxable service and failed to observe statutory provisions for registration and payment of service tax, there was suppression of material fact - the Tribunal held that the extended period of limitation cannot be invoked in this case and the demand if any, can only be survived within the normal period of limitation.
There is no incentive for the respondent-NRSA to resort to evasion of tax which could result either in the profits soaring higher or any individual being benefited. On the other hand if there existed a liability, the respondent could have factored the same in its budget proposals and sought for release of more funds from the Government to discharge its liability. Thus, it is only flow of funds from one pocket to the other pocket of the Government and would not result in any gain either to the organization or to any individual. In this view of the matter, it is absurd to even suggest that the respondent had suppressed facts with an intent to evade payment of tax, and mulct it with payment of service tax by invoking the extended period of limitation.
The focus of the organizations like the respondent-NRSA is definitely not on either resorting to tax evasion or tax planning which would benefit the establishment, but is focused in its core activity of research and assisting the other agencies of Government in various projects. The said fact was completely lost sight by the appellant-Revenue while passing the Order-in-Original, which however, has been rightly taken note by the Tribunal.
This court is of the view that in the given facts and circumstances, the Tribunal has given cogent reasons for holding that the extended period of limitation under Section 73(1)(a) of Finance Act, 1994 would not be invocable - the order of the Tribunal waiving all penalties by invoking Section 80 of the Finance Act, is also rightly justified.
Appeal dismissed.
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2021 (6) TMI 678
Dishonor of Cheque - acquittal of the accused - rebuttal of presumption - burden on the complainant to prove each and every fact even after accused admitting the cheque - HELD THAT:- Accused admitted that Ex.P.1-cheque belongs to him and it bears his signature. Even though the accused taken up a defence that he was not knowing the complainant, he was not familiar with him, he had not borrowed any amount from the complainant nor issued Ex.P.1 in his favour, the moment he admits that the cheque relied on by the complainant belongs to him and it bears his signature, presumption under Section 139 of N.I. Act arises. Similarly, Section 118 of N.I. Act gives raise to presumption regarding the consideration, date, time of acceptance, endorsements and that the holder is a holder in due course until the contrary is proved. Therefore, once the accused admits the cheque in question and his signature found therein, the initial burden of proving the contention is discharged by the complainant and it is for the accused to rebut these presumptions by raising the defence and probabalising the same.
The complainant has discharged his initial burden of proving Ex.P.1-cheque upon which the presumption under Sections 118 and 139 of N.I. Act arises. Even though the accused is required to probabalise his defence to rebut the presumptions, he has failed to do so. Therefore, the accused is liable to be convicted - the trial Court has erred in acquitting the accused ignoring the settled proposition of law on the subject and wrongly placing the burden on the complainant to prove the existence of legally recoverable debt in spite of the accused admitting issuance of the Ex.P.1-cheque with signature. The impugned judgment of acquittal passed by the trial Court is nothing but perverse and illegal.
Criminal appeal is allowed.
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2021 (6) TMI 677
Clandestine removal - cut tobacco - evidence to establish the guilt of the petitioners regarding evasion of excise duty or clandestine removal of goods, present or not - criminal proceedings ended in acquittal but simultaneous departmental proceedings continued - HELD THAT:- On a perusal of the complaint, it is to be noted that the averments therein are verbatim repetition of the averments in the show cause notice dated 05.12.1995. There cannot be any doubt that departmental proceedings and criminal prosecution can be initiated simultaneously. It is settled law that there cannot be any hard and fast rule as to whether the criminal proceedings have to be quashed after departmental proceedings are concluded in favour of the accused. It depends upon the fact situation arising in each case. The appeal has been allowed vide order dated 26.12.2013 by the CESTAT giving a clean chit to the accused - it was categorically held that the lower authority has not given any reasons to impose penalty on the accused and there is no evidence to that effect. The order of the appellate authority has attained finality. Thus, continuance of prosecution against the petitioners under self-same allegations contained in the departmental proceedings is an exercise in futility.
In view of the fact that the Commissioner (Adjudication), directed the department to initiate further proceedings in law for time being in force, as the accused company was found to have evaded payment of duty under Rule 9(2) of the Central Excise Rules, 1944 read with Section 11-A of the Act and confiscation was ordered and penalty was levied under the relevant Rules - It is settled law that the standard of proof in criminal proceedings is higher than the standard of proof in civil/departmental proceedings. In a reverse case, where criminal proceedings ended in acquittal but simultaneous departmental proceedings continued, the result of the criminal proceedings will not have any bearing on the departmental proceedings, as judgment of the criminal Court is not binding in civil or departmental proceedings. However, in the instant case, when the departmental proceedings ended in favour of the accused and moreover, when the prosecution launched is on the same set of facts and allegations, the continuance of prosecution would be gross abuse of process of law.
The criminal petition is allowed.
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2021 (6) TMI 676
Seeking Bail - Passing of fake input tax credit - issued fake invoices/bills without receipt of goods - commission of economic offences - Offences under Sections 132(1)(b) 7 (c) of CGST Act, 2017 - HELD THAT:- As the law stands, in such type of offences, while granting bail, the Court has to keep in mind, inter alia, the larger interest of the public and State. The accused is active in creation and operation of the nonexistent business entities for availing and passing of bogus ITC thereby defrauding the state exchequer.
Considering the nature and gravity of the accusation, the nature of supporting evidence, availability of prima facie case against the petitioner, coupled with the fact that a huge amount of public money has been misappropriated and also the fact that further investigation of the case is under progress and taking into account the apprehension of the petitioner in tampering with the evidence, in the larger interest of society, the petitioner is not allowed to be released on bail - bail application dismissed.
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2021 (6) TMI 675
Duty Drawback - non realisation of export proceeds - violation of principles of natural justice - HELD THAT:- This Court is of the considered opinion that even in such circumstances the grievances if at all exists the same can be exhausted by filing an appeal before the appellate authority under the provisions of the Customs Act. The introductory paragraph of the impugned order states that an appeal against the order lies with the Commissioner of Customs (Appeals), Custom House, 5 th floor, Chennai 600 001, under Section 128(1) of the Customs Act, 1962, within 60 days of communication of this order. Thus the petitioner is very much aware of the appellate remedy contemplated and such an appellate remedy is also informed to the petitioner even through the impugned order. However without exhausting the appellate remedy the present writ petition is filed by merely stating that the respondent has violated the principles of natural justice.
Such legal grounds can be adjudicated by the appellate authority namely the Commissioner of Customs (Appeals) and therefore entertaining the writ petition at this juncture would deprive the litigant from availing the benefit of appellate remedy which is undoubtedly valuable and important.
Petition dismissed.
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2021 (6) TMI 674
Cancellation of the Sales Tax Eligibility Certificate - Entitlement for sales tax incentive - entitlement to priority industry status - Industrial Policy Resolution 1996 - HELD THAT:- While it is true that the Petitioner as a new unit was in the SSI category, it graduated to a Medium Scale industry after the expansion and modernization drive. It satisfied the description of an "existing unit" that had undertaken expansion and modernization - Once the Petitioner has been declared as a priority industry in terms of IPR 1996 Clause 2.7 (i) and (xii) Part-II, the Petitioner's unit was eligible to get an additional two years of sales tax exemption. The Petitioner is right in its contention that the Opposite Parties are mistaken in their stand that IPR 1996 was meant only for a New/SSI/Medium/Large industry. The notification issued by the Opposite Parties themselves belies this contention. SRO 475/96 dated 26th July 1996, referred to hereinbefore, envisages an existing industrial unit undertaking "fixed capital investment" and having commenced after 1st March, 1996. Clearly, this would include an existing unit, which undertakes expansion and modernization after 1st March, 1996. The certificate issued by the DoI on 7th March, 2002, in Form II-A, granting the Petitioner eligibility for sales tax concession "on sale of finished products” acknowledges both the new products as well as the existing product viz., ‘air coolers’.
Indeed, the Opposite Parties have no answer to the above contention of the Petitioner that it was a unit ‘in the pipeline’ in terms of SRO 141/2000. The Petitioner has also clarified how its agreement with M/s. Nilkamal Plastic Private Limited had no relevance to its claim for sales tax exemption. The machineries for the manufacture of moulded plastic furniture were purchased from M/s. Nilkamal Plastic Private Limited under proper invoices, challans and excise gate passes. It was the Petitioner that produced the finished products - With the Petitioner satisfying all the requirements of the applicable notifications, there appears to be no justification in the Opposite Parties seeking to revoke the sales tax exemption thereby cancelling the certificate issued for that purpose.
It is held that the Petitioner, as a priority industry, is eligible to avail sales tax benefit as contemplated under IPR 1996 in terms of notification dated 2nd February, 1999 and, therefore, is entitled to sales tax exemption for an additional two years as claimed by the Petitioner - Petition allowed.
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2021 (6) TMI 673
Refund of service tax paid by utilizing the Cenvat credit denied - denial on the ground that the output service was exempt under section 102 of Finance Act, 1994 - refund of interest - HELD THAT:- The learned Commissioner (Appeals) held that reversal of Cenvat credit under Rule 6 of Cenvat Credit Rules, 2004 would not arise. Despite this clear finding the learned commissioner (Appeals) denied the refund on the ground that it will lead to double benefit once through availment of Cenvat credit and another through refund of service tax which is not permissible at all. With the above finding it is settled that Rule 6 shall not apply in the present case. The revenue also not challenged this finding therefore, it attains the finality. Now the issue remains to be decided that when the output services has been exempted retrospectively with a rider that whatever duty was paid to be refunded to the assessee, whether the service tax paid through utilization of Cenvat credit should be refunded or otherwise. During the relevant period i.e. 01.04.2015 to 29.02.2016 the output services were very much taxable - The appellant was legally entitled for the Cenvat Credit on the input service received from the sub- contractors and used in providing the output service.
As per the plain reading of section 102 legislature knowing well that service tax on the construction service obviously paid not only on cash but also by utilizing the Cenvat credit on input service. With this clear understanding provision of refund of service tax paid on output service was also provided in section 102. There is no provision to given a different treatment of service tax paid on output service that whether the entire service tax was paid from cash or partly paid from cash and partly from Cenvat credit. Therefore, in whatever manner the service tax paid irrespective partly from cash and partly from Cenvat credit, total tax paid by the assessee was mandated to be refunded to the service provider.
Also, the provision of Rule 11 of the Cenvat Credit Rules, 2004, is applicable only in the case where the assessee has taken the Cenvat Credit on Input Service and the said credit is lying unutilized and the output service became exempted - In the present case while taking the Cenvat credit the output service were not exempted and the Cenvat credit was utilized for the payment of service tax therefore, neither any Cenvat credit was lying accumulated nor the service at the relevant time was provided under exemption particularly issued under section 93 of the Finance Act, 1994. In the present case during the relevant period the services were very much taxable therefore, the availment of Cenvat credit and utilization thereof and also payment of service tax on the output service was correct. Hence, the of sub- rule (4) of Rule 11 of the Cenvat Credit Rules is not at all applicable in the facts of the present case.
Thus, in the present case there is no dispute in availment of Cenvat credit at the time of receipt of input service. Therefore, subsequent exemption by virtue of section 102 of Finance Act, 1994 will not make disentitle the appellant from the said Cenvat credit.
Refund of interest - HELD THAT:- The said interest was paid on the service tax which is refundable under Section 102. When there is no levy of service tax the government cannot retain the interest paid on such non levy therefore, even though it is not specifically provided under Section 102. The interest paid on the service tax which is to be refundable is nothing but a piggy back of refundable service tax. Hence, the same is eligible for the refund to the appellant.
The appellant is entitled for the refund of service tax paid through Cenvat credit and also the interest paid for delay in payment of service tax - appeal allowed - decided in favor of appellant.
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2021 (6) TMI 672
Valuation of imported goods - Toyota Landcruiser - misdeclaration of goods by concealing evidence - Confiscation of goods - Penalty - HELD THAT:- It is clear from the conditions specified in public notice no. 3 (RE-2000)/1997-2002 dated 31st March-2000 of Director General of Foreign Trade that endorsement of ‘no sale’ for two years was to be recorded by the competent authority in the registration certificate of the vehicle. The appellant, having entered into lease agreement with the importer, cannot be said to be ignorant of such condition. Nonetheless, we are unable to concur with the findings of the lower authorities that ‘no sale’ restriction has been breached by taking possession of the vehicle on lease. The distinction between ‘sale’ and ‘lease’ is not only substantive but also legally unassailable - the appellant cannot be held liable as a willful participant in breaching conditions of import. Consequently, the penalty on the appellant does not sustain.
Demand of differential duty - HELD THAT:- There is no doubt that the differential duty confirmed by the lower authorities under section 28 of Customs Act, 1962 cannot be fastened on the appellant as a substitute for the importer.
Confiscation for misdeclaration of value - alleged breach of condition of ‘no sale’ - HELD THAT:- Though the relative gravity of each has not been mathematically determined, the lack of challenge to the former in the present proceedings precludes erasure of confiscation under section 111 of Customs Act, 1962 and, thereby, retains fine, even in the lack of segregation, for redemption. In this peculiar circumstance of challenge restricted to one of the grounds of confiscation coupled with the absence of appeal by the person affected by the other, it would be inappropriate for us to contemplate alteration of the fine.
In view of our findings supra, the appeal is allowed to the extent of setting aside the penalty imposed on the appellant with the clarification that the appellant may not be subjected to recovery proceedings for differential duty, redemption fine or penalty that devolves on the importer.
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2021 (6) TMI 671
Valuation of imported goods - baby garment woolen knitted top - baby garments woolen knitted jacket - change in classification - classification be revised from tariff item no. 6111 30 00 to tariff item no. 6106 20 10 and tariff item no. 6203 33 00 of First Schedule to Customs Tariff Act, 1975 respectively or not - enhancement of declared value - HELD THAT:- The classification for ‘baby woolen tops’ and ‘baby woolen jackets’, adopted by the importer, appeared to have been discountenanced by the Textile Committee for two reasons: that the articles were made of polyester fibre, and not of wool as described in the bill of entry, and that visual examination by the Textile Committee found these to be intended not for babies but for girls and boys. The ‘boys’ jackets’, found not to be knitted, was sought to be fitted within chapter 62 of First Schedule to Customs Tariff Act, 1975. On these bare facts, the defensibility of the conclusions may not offer cause for quarrel. The tariff schedule, however, is no streetside smorgasbord.
Chapter 61 and 62 of the First Schedule to Customs Tariff Act, 1975 enumerate groupings of apparels designed for human wear and, under the broad categorisation as ‘knitted/crocheted and’ those that are not, save for a single exception which is not material to this dispute, as mutually exclusive. In both, distinction of gender is the consistent dichotomy; the stages of human life though, are reduced to three in the interest of eliminating controversy - The claim of the importer for coverage of the imported goods under tariff item 6111 30 00 may not, necessarily, have been in conformity with the description in the bill of entry. Nevertheless, it is in consonance with the composition as indicated by testing of the samples; the claimed classification pertains to garments made ‘of synthetic fibres’ which, though wool may not be, ‘polyester’ is nothing but. There was, thus, no reason to allege misdeclaration, either on the count of size or of composition, with the detrimental consequences of revising the rate of duty and the assessable value.
As the declaration is not in question as far as the goods for which bill of entry had been filed is concerned, the order for recovery of differential duty and confiscation of goods as well as imposition of penalty does not have the authority of law and must be set aside - Appeal allowed in part.
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2021 (6) TMI 670
Empowerment to deny availment of exemption extended to indigenously manufactured goods by notification issued under Central Excise Act, 1944 - non-compliance with conditions prescribed in parallel notification issued under Customs Act, 1962 for procurement from abroad - HELD THAT:- Tax liability under Customs Act, 1962 arises upon import of goods with the importer responsible for compliance with all requirements for clearance; the liability under Central Excise Act, 1944 is, though collected on clearance, a levy on manufacture that the manufacturer assumes responsibility for. With registered status under the statute, a manufacturer, supplying goods against an exemption notification, poses lesser risk than an importer in recovery of duty foregone in the event of misuse. The procedural prescriptions stipulated for exemption from duties of customs are intended to neutralize that additional risk without causing undue inconvenience to the transaction.
Imports are effected by the designated agency or their subcontractors for implementation of the project and, to them, prescribed certification is of easy access; the role of a manufacturer is limited to supply which precludes direct access to such certification. While the intended deployment and procurement through ‘international competitive bidding’ is, doubtlessly, ascertainable at the premises of the importer, the prescribing of certificate to be furnished eliminates such repeated verification of the threshold eligibility for each clearance of imports - The essence of optimal sourcing being the disregarding of customs frontiers, the enumeration of goods entitled to exemption from duties of customs does not bear replication in the exemption notification under Central Excise Act, 1944 and the condition prescribed therein should not have to be expanded beyond that limited purpose. It would be stating the obvious to point out that domestic procurement is not subject to the same risks or the verification of eligibility so burdensome as to warrant that the facilitative procedures of the notification issued under Customs Act, 1962 be replicated in the notification issued under Central Excise Act, 1944.
The impugned order lacks legality for having ordered recovery of duty and imposed penalties despite the appellant having complied with conditions for availment of exemption - Appeal allowed - decided in favor of appellant.
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2021 (6) TMI 669
Deduction u/s 54F - AO restricting the claim of the assessee u/s 54F to one flat as against the claim of the assessee for exemption in respect of the entire constructed area received - whether CIT(A) is justified in allowing the exemption claimed u/s 54F when the assessee received multiple flats located on different floors separated by different blocks of a gated community/ apartment complex? - HELD THAT:- As gone through the allotment of apartment, it is clear that some of the Blocks have been allotted fully to the assessee/assessees and some of the Blocks are partially allotted amongst the assessees and developers.
Assessee has not submitted any documents or any allotment letter for ascertaining the number of flats allotted to the assessee/assessees by the developers which is root for determining the deduction u/s 54F - CIT(A)’s decision is right if the assessee has been allotted a house or more than a house in a Block/Tower as per the decision cited supra. The said blocks consist of more than a floor i.e. 5 floors. We, therefore, remit this file back to the AO for verification for the allotment of flats, which have been allotted to the assessee in a Block/Tower or in different Blocks/Towers. If the AO is found that the assessee has been allotted residential units in more than Blocks/Towers, the AO will recompute the capital gain afresh in the hands of the assessee as per law after providing reasonable opportunity of hearing to the assessee. The assessee is also directed to substantiate its claim u/s 54F by producing necessary documents and avoid unnecessary adjournments. Accordingly, the grounds raised by the revenue are partly allowed for statistical purposes.
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2021 (6) TMI 668
Deduction u/s 80IA - Claim restricted to extent of income from business and profession - AO be directed to allow the claim of deduction under section 80IA of the Act against the gross total income - HELD THAT:- The assessee is not eligible to claim the deduction u/s 80IA of the Act. The legislature has clearly spelt out in the deduction provisions that which incomes are eligible to claim deduction u/s 80IA, and therefore, the assessee cannot go beyond the provisions and claim deduction u/s 80IA. The deduction provisions should be interpreted strictly and if there is any ambiguity, it goes to in favour of revenue - See RAMNATH & CO. VERSUS THE COMMISSIONER OF INCOME TAX [2020 (6) TMI 158 - SUPREME COURT] - Accordingly, the assessee is not eligible to claim deduction u/s 80IA from the income from house property as claimed. Thus, we dismiss the ground no. 1 raised by the assessee on this issue.
Disallowance u/s 14A - HELD THAT:- It is a settled position that disallowance of expenditure u/s. 14A read with Rule 8D shall not exceed exempt income earned for the year as per case law Joint Investment Pvt. Ltd.[2015 (3) TMI 155 - DELHI HIGH COURT]. The assessee earned exempt income of ₹ 42,35,977/- as per computation of income. Therefore, we direct the AO to restrict the disallowance u/s 14A rwr 8D to ₹ 42,35,977/-.
Disallowance u/s 14A rwr 8D(2)(ii) and (iii) - value of investments should be considered only on the investments from which the assessee has earned exempt income - HELD THAT:- As relying on TRANSPORT CORPORATION OF INDIA LTD. [2016 (11) TMI 245 - ITAT HYDERABAD] We direct the AO to recalculate the disallowance as per rule 8D as per the above guidance. We further direct the AO if the disallowance u/s 14A is higher in the recalculation made by the AO, the same shall be restricted to the extent of exempt income earned by the assessee as per the case law Joint Investment Pvt. Ltd[2015 (3) TMI 155 - DELHI HIGH COURT]
Dividend income should be treated as income from other sources is also not correct - Assessing Officer himself has treated it as a dividend income which is exempt and on other hand, he has treated as daily dividend income and taxed under the income from other sources. While recalculating disallowance u/s 14A, we have restricted the disallowance to the extent of exempt earned by the assessee or less than the exempt income, whichever is lower and the same amount cannot be taxed as income from other source, which amounts double taxation in the hands of the assessee. The dividend amount received by the assessee is exempt as per section 10(35) of the IT Act.
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2021 (6) TMI 667
Accrual of income in India - Income taxable in India - payments received by the assessee on account of Management Service Fees - Tax Treaty between India and Portual (referred to via protocol attached to Double Taxation Avoidance Agreement (DTAA) between India and Sweden - HELD THAT:- The fact as on date is that the issue in respect of Management Service Fees is well covered in favour of the assessee. The Revenue has preferred appeal before the Hon’ble jurisdictional High Court on the substantial question of law on the same issue. That however, the matter has not yet attained finality at the High Court level nor we find any contrary direction given by the Hon'ble High Court in respect of the issue of Management Service Fees vis-à-vis the ITAT orders in favour of the assessee. Therefore, it is clear that as on date, the issue decided is in favour of the assessee.
Tribunal had analyzed the DTAA between India and Portuguese Tax Treaty rendered to (via protocol) attached to the Tax Treaty between India and Sweden and had held that the payments received by the assessee on account of Management Service Fees cannot be brought to tax in view of the principle of most favoured nation (MFN) clause in the Tax Treaty. In view of the aforesaid discussion, we are of the considered view that Management Service Fees cannot be brought to tax in India. Thus, grounds 1 and 2 are allowed.
Tax receipts towards Leadership Training Fee - HELD THAT:- Since the assessee is a Sweden based company and SAPL has its registered office in India, basically they are covered by the India – Sweden Tax Treaty. That however, in the said tax treaty, there is a special protocol with respect to the Most Favoured Nation (MFN) clause and there is DTAA entered into between India and Sweden and now the parties of original DTAA agreement between India and Sweden would be governed by the provisions of DTAA between India and Portuguese Republic which they entered into through MFN clause.
As assessee submitted that let the matter be remanded to the file of Assessing Officer to re-adjudicate this issue after factual verification as per the legal proposition laid down by the order of the Tribunal [2021 (1) TMI 211 - ITAT PUNE] The learned Departmental Representative did not raise any objection. In view of the above facts, we set aside the findings of the DRP on this issue of Leadership Training Service Fees to the file of Assessing Officer to re-adjudicate while complying with the principles of natural justice and as per law as indicated hereinabove.
Appeal of the assessee is partly allowed for statistical purposes.
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2021 (6) TMI 666
100% EOU - Refund of unutilized CENVAT Credit - invoices in terms of Rule 4A of the Service Tax Rules, 1994 - HELD THAT:- The appellant is a 100% EOU and have availed various input services in the course of providing their output service.
Denial of credit on account of non-availability of registration details of input service providers - HELD THAT:- It is seen from the order of the Commissioner (Appeals) that the credit of ₹ 67,446/- had been rejected for the reason that invoice copies do not contain the registration no. of the service provider - On perusal of the documents, it is seen that the registration details of the input service provider were available and therefore, the rejection of refund on the ground of non-availability of registration No. in the invoices is not maintainable. Consequently, refund amounting to ₹ 67,446/- covered by such input service invoices, are allowable.
The appellants are eligible for the refund - Appeal allowed - decided in favor of appellant.
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2021 (6) TMI 665
Disallowance of project expenses - Addition on the ground as no project-wise accounting was available and no work-in-progress was reported - Addition towards unsubstantiated project expenses - CIT-A deleted the addition even though the assessee failed to bring any material before the Ld. CIT(A) to substantiate the genuineness of such expenses - HELD THAT:- It is undisputed that addition has been made by the Assessing Officer following the findings of his predecessor and the Learned CIT(A) has also deleted the addition following her predecessor’s decision in AY 2012-13 wherein held that on our examination of the method of accounting applied by the assessee, it appears that when the assessee has received billing as per milestone and from the milestone till the close of the year there are no expenditure identified by the Id AO then there cannot be any work in progress in the business of the assessee. The Id AO could not find out that whether there is such expenditure exists or not. It was also not found by the Id AO that the assessee has incurred substantial expenditure. If the milestone before the close of the year.
As the assessee is engaged in the business of consultancy services definitely there can be sum over lap of the expenses between two years. However that does not give any rise to the AO to disallow the expenditure @10% and treat it as work in progress. We do not find any reason to deviate from this reason given by the Id CIT(A) in deleting the above disallowance.Appeal of the Revenue is dismissed.
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2021 (6) TMI 664
Disallowance on account of investment allowance u/s 32AC - Appellant is a State Government Public Sector Undertaking engaged in the business of generation of electricity - whether electricity is “goods”? - WhHELD THAT:- We find force in the written submissions filed by the ld. AR of the assessee. In the case of Vedanta Ltd. [2020 (9) TMI 1010 - ITAT DELHI] relying on the judgement of Sesa Goa [2004 (11) TMI 14 - SUPREME COURT] and NTPC Ltd [2012 (5) TMI 127 - ITAT DELHI] directed the AO to allow the claim of deduction u/s 32AC of the Act.
As held generation of electricity is a manufacturing activity decision cited supra, The electricity can be transmitted, transferred, delivered, stored, possessed etc. The Hon'ble Supreme Court in the case of the CST Vs. Madhya Pradesh Electricity Board [1968 (11) TMI 85 - SUPREME COURT] has held that electricity falls within the definition of goods under the provisions of Sale of Goods Act, 1930. Therefore, respectfully following the above judgements , we set aside the order of CIT(A) and direct the AO allow the assessee’s claim of deduction u/s 32AC of the Act. Accordingly, the ground raised by the assessee on this issue is allowed.
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