Assessment in the case of a Dead/non-existent company - scheme of amalgamation approved - notice issued in the name of company dissolved - HELD THAT:- Assessee company filed its return of income on 29.09.2014 in the name of M/s. Cellnext Solutions Private Limited under these circumstances when the assessee itself has filed return of income in the name of Cellnext Solutions Private Limited on 29.09.2014 whereas the scheme of amalgamation was sanctioned by the Hon’ble Delhi High Court vide order dated 11.08.2014 and 19.08.2014 which is effective from 01.01.2014 the assessee in my opinion cannot argue that assessment has been framed on a dead company or a non-existent company.
We deem it proper to restore the issue to the file of the Assessing Officer with a direction to pass appropriate order in the light of the decision of M/s. Spice Infotainment Ltd. [2011 (8) TMI 544 - DELHI HIGH COURT]. Since the ld. Counsel for the assessee did not argue the other grounds on merit, therefore, these grounds are dismissed. The appeal filed by the assessee is accordingly allowed for statistical purpose.
TP Adjustment - comparable selection - Maveric Systems Ltd. inclusion/eclusuion - HELD THAT:- We find that the Tribunal in the case of ACIT Vs. M/s. MSC Software Corporation of India Pvt. Ltd. [2018 (10) TMI 1433 - ITAT PUNE] had decided similar issue of functional comparability of Maveric Systems Ltd. to the concern engaged in providing software development services. After analyzing the functionality of said concern and in turn, relying on the other decisions of Pune Bench of Tribunal, Maveric Systems Ltd. was found to be functionally comparable to the concern providing software development services. Following the same parity of reasoning, we uphold the order of DRP in this regard and dismiss grounds of appeal raised by Revenue.
n view of the concession of learned Authorized Representative for the assessee that in case Maveric Systems Ltd. is included in the final list of comparables, then the margins of assessee would be within +/- 5% mean margins of comparables, we do not adjudicate ground of appeal No.4 raised by Revenue.
Disallowance interest expenditure - estimating reasonable rate of interest @ 12% in contrast to actual rate of interest paid @ 15% without finding the reasons for unreasonableness of the interest rate at prevailing market rate - HELD THAT:- We find that the AO has disallowed interest expenditure in aggregate paid on loans received from relatives. It is found that the assessee has taken loan from the relatives @15%, whereas similar money has been simultaneously stood invested by way of loans and advances on which interest @ 12% p.a. has been charged.
We notice from the concurrent orders of the AO and CIT(A) that no proper justification has been given by the assessee for borrowals at a higher rate and corresponding lending at a lower rate. Clearly the excess interest paid to the relatives qua the loans and advances do not appear to carry attributes of commercial expediency. Therefore, the Revenue authorities were justified in making disallowance of excess interest expenditure. We thus find no infirmity in the order of the CIT(A) and hence, decline to interfere.
Penalty u/s 271D - contravention of provisions of section 269SS - matter of accepting unsecured deposit in cash from Wife of the Appellant - HELD THAT:- We find that assessee has supported the receipt of cash from wife by way of documentary evidences and bonafides of action. The transaction has been done with spouse and claimed that the assessee was under bonafide belief that transaction with intimate person could not attract mischief of provisions of action u/s 269SS - The aforesaid contention of the assessee pleading bonafide cannot be brushed aside summarily having regard to conventional constructs and postulations which define Indian socio-eco structure. Thus, in the absence of any doubt cast towards bonafides of such small amount of loan, mere breach of section 269SS is to be regarded as technical or venial in nature in the given circumstances. We therefore find adequate justification in the plea of the assessee for setting aside the imposition of penalty u/s 279D of the Act in this regard. AO is likely directed to delete the penalty on this score.
Transfer of deity - the property of Deity Shree Shree Ram Janki Ji Asthan Tapowan Mandir at Ranchi has been transferred against the mandate of the Trust Deed created by the author of the Trust to establish Shree Ram Janki Tapowan Mandir Trust on 25.02.1948 - High Court entertained the Public Interest Litigation preferred by Respondent No. 8, and held that there is no provision in the original Trust Deed to transfer/sale of the property of the Deity but with ulterior motive, new Trust Deed was prepared in the year 2005 to usurp the property of the Deity and to facilitate illegal transfer of land of the Deity.
HELD THAT:- The High Court has passed an order directing investigation by Central Bureau of Investigation by casually returning a finding that permission was obtained by the Trust by misrepresentation and fraud. The High Court was again not careful to return findings on the disputed questions of fact and that too in a public interest writ petition - The vesting of the property in Deity is a religious endowment but has no public element in it, the grievance of which can be made in a writ petition filed in the public interest. We do not say any more than the fact that the High Court should have refrained from entertaining such Public Interest Litigation in respect of alleged wrongful sale of property of the religious bodies.
The question as to whether the High Court could direct CBI to take over investigation in the facts of the present case needs to be examined. The Constitution Bench in its judgment reported as State of West Bengal and Others v. Committee for Protection of Democratic Rights, West Bengal and Others [2010 (2) TMI 1118 - SUPREME COURT] has examined the question as to the rights of CBI to investigate a criminal offence in a State without its consent. This Court examined Entry 2 of List II of VII Schedule of the Constitution. It was held that the legislative power of the Union to provide for the regular police force of one State to exercise power and jurisdiction in any area outside the State can only be exercised with the consent of the Government of that particular State in which such area is situated.
A three Judge Bench Judgment reported as SUJATHA RAVI KIRAN @ SUJATASAHU VERSUS STATE OF KERALA & ORS. [2016 (5) TMI 1594 - SUPREME COURT] held that the extraordinary power of the Constitutional Courts in directing CBI to conduct investigation in a case must be exercised rarely in exceptional circumstances, especially, when there is lack of confidence in the investigating agency or in the national interest.
The finding recorded by the High Court that the Deity could not transfer its land in any case is not tenable. The appellant relies upon statutory provisions in support of its stand to transfer of land. The sweeping remarks that the allegations are against the Government and the Board which consist of Government functionaries; therefore, the matter requires to be investigated by CBI are wholly untenable and such sweeping remarks against the Government and/or the Board should not have been made - merely because, permission has been granted by a functionary of the State Government will not disclose a criminal offence. The High Court has thus travelled much beyond its jurisdiction in directing investigations by CBI in a matter of sale of property of the Deity. Still further, the High Court has issued directions without their being any complaint to the local police in respect of the property of the religious Trust.
The High Court has completely misdirected itself in directing the Central Bureau of Investigation to take over investigation in a matter which relates to the rights of the trustees to sell property of a religious Trust or Deity, giving rise to civil dispute.
Appeal as dismissed for want of prosecution - HELD THAT:- Even the notice of todays hearing was sent to the assessee by mentioning the address M/s Guru Nanak Auto Enterprises Ltd., H.O. Ist Floor, HC Complex, Adjacent N.V. Motors, Rajindera Nagar, Police Line however the notice returned back with the postal remark Left without address.
As also noticed that no adjournment application filed by the assessee or by its counsel. Hence, in the absence of the assessee we do not have any option except to dismiss the appeal of the assessee in limine. Therefore, considering the facts and keeping in mind the provisions of Rule 19(2) of the Income-tax (Appellate Tribunal) Rules, 1963, as was considered in the case of CIT Vs. Multiplan India Ltd, [1991 (5) TMI 120 - ITAT DELHI-D] we treat this appeal as unadmitted.
Accordingly, the appeal is dismissed for want of prosecution. Assessee shall be at liberty to seek recall of this order by showing sufficient and bonafide cause for not receiving /serving of notice at the address given and for non appearance, and if the Bench is so satisfied about the reasons, etc., it can recall the above order. Appeal filed by the assessee is dismissed in limine.
Reopening of assessment u/s 147 - Ground on reopening was argued by ld. AR and bench has not adjudicated - HELD THAT:- As we checked our records and found that ld. AR has argued the issue briefly and not made elaborate submission, mainly focussed on the merit of the case. After considering the affidavit of the ld. AR, in our view, for the sake of natural justice, assessee deserves one more opportunity. Therefore, we are inclined to re-fix this issue for rehearing to both the parties for the limited purpose of submissions on reopening of the assessment.
Whether ITAT has erroneously took up new issue without giving an opportunity to assessee while adjudicating the issue? - As we have already adjudicated this issue, may be it was not understood by the parties, this issue is not new but culminated out of the books of account prepared by assessee - Consider the actual stock of opening & closing i.e. A&C are same. The inflated stock of opening i.e. ‘B’ is an additional expenditure absorbed in the AY 2010-11, which will reduce the actual profit for the Ay 2010-11 and ultimately reducing the taxable income of the assessee for the AY 2010-11 - Therefore, we have explained the issue of merit in our order.
Accordingly, we refix the case for limited purpose of adjudicating on reopening of the assessment. The registry is directed to fix the case for rehearing in due course and inform the parties accordingly.
Levy of penalty u/s 78 of FA - applicability of benefit of subsection (3) of Section 73 ibid - entire service tax liability along with interest in respect of the adjudged demands, have already been paid before adjudication of the matter - bona fide belief - intellectual property rights service - Reverse Charge Mechanism - it is claimed that the issue was was contentious and there was not wilful suppression - HELD THAT:- The observations made in the impugned order regarding non-consideration of payment at the factory towards the service tax liability of head office is not legally sustainable inasmuch as the statutory levy has to be paid into the Central Government Account, irrespective of the fact from which office or establishment of the assessee, such payment has been made. However, it is found that the original authority has not considered payment of such amount by the appellant. Thus, under the circumstances, the matter should go back to the original authority for ascertaining the fact, whether such amount of Rs.26,548/- has already been paid by the appellant.
Imposition of penalty under Section 78 ibid - HELD THAT:- The submissions of the appellant that nonpayment of service tax within the stipulated time frame was not owing to the reason of fraud, collusion, wilful misstatement, etc., with the intent to defraud the Government Revenue are agreed upon - the ingredients mentioned in Section 78 ibid are not present in the case, justifying imposition of equal amount of penalty on the appellant - the benefit provided under sub-section (3) of Section 73 ibid should be available to the appellant inasmuch as the disputed amount of service tax along with interest was paid by the appellant much before issuance of the show cause notice and accordingly, proceedings cannot be initiated, especially for imposition of penalty.
The impugned order, in so far as it has imposed penalty under Section 78 ibid on the appellant is set aside - the matter is remanded to the original authority for ascertaining the fact whether the disputed amount of Rs.26,548/- has already been paid, as claimed by the appellant and accordingly, decide the issue - appeal disposed off.
Assessment u/s 153A - disallowance of interest paid on loan holding that the loan funds were not utilized for the business purposes - whether no incriminating material was found during the course of search and addition has been made merely on the basis of information called during the course of assessment proceedings? - HELD THAT:- we find that the assessee filed regular return of income u/s.139 of the Act for Assessment Year on 30.09.2008. Assessee's case was not selected for scrutiny, as notice u/s. 143(2) of the Act was not issued to the assessee on or before 30.09.2009. Search was conducted on 29.1.2014. Impugned addition is purely based on information called during the course of search proceedings. In this situation the assessment for Assessment Year 2008-09 is to be treated as non abated assessments for which additions could be made only on the basis of incriminating material found during the course of search. Therefore in the given facts and circumstances of the case and respectfully following the decision of the co-ordinate bench referred above, we direct the Ld. A.O. to delete the disallowance.
Whether no addition was called for as no incriminating material was found during the course of search u/s. 132? - Assessment Year 2009-10 - HELD THAT:- No merit in this ground because the assessee has not filed regular return of income u/s. 139 of the Act. Return of income for Assessment Year 2009-10 was filed on 28.1.2016 i.e. after the date of search u/s. 132 of the Act. Therefore assessment year 2009-10 cannot be treated as non abated assessment and Ld. A.O. was well within his powers u/s. 153A r.w.s. 143(3) of the Act to carry out regular assessment proceedings for Assessment Year 2009-10 and for making additions if any and it was not necessary to prove the nexus with the incriminating material found during the course of search. Therefore the assessee fails to succeed in this legal ground raised.
Disallowance of interest paid on loan - HELD THAT:- Allegation of the lower authorities that the bank loan was not utilised for business purposes has no legs to stand. Further the assessee has incurred consistent losses. No business activity is carried out since 1.4.2008. Bank loan was outstanding. For repayment of bank loan the partners have brought additional capital to repay the loan. In these facts and circumstances, we find no justification in the action of Ld. A.O. disallowing the interest paid on loan to the bank completely ignoring the fact that during the year under appeal assessee is having NIL revenue and it is not the case of the revenue authorities that the assessee has claimed the interest to reduce its tax liability. We accordingly delete the disallowance for Assessment Year 2009-10 and allow this issue raised in Ground No. 2 of assessee's appeal.
Addition u/s 68 - Unexplained recovery of excess withdrawal of capital - unexplained cash credit for the capital addition by partners to the assessee firm - HELD THAT:- No major amount of cash has been deposited before the issuance of the cheque to the assessee firm. Ld. A.O. has not conducted any enquiry from Mr. Manoj Jain before making the alleged addition. The alleged amounts of capital contribution is for repaying the bank loan outstanding in the name of assessee firm. We therefore are satisfied that the assessee has successfully proved the identity, genuineness and creditworthiness of the capital contribution received from the partner Mr. Manoj Jain. Therefore no addition was called for u/s. 68
As capital contribution by another partner Mr. Manish Rawatiya assessee failed to file confirmation letter, income tax return, bank statement and proof of source of income. However, Ld. A.O. has not conducted any enquiry into the matter by issuing notices to Shri Manish Rawatiya calling for the necessary information to prove the creditworthiness - thus in the interest of justice assessee deserves one more opportunity to prove the creditworthiness of the partner Mr. Manish Rawatiya giving capital contribution. Appeal partly allowed for statistical purposes.
Admission of additional claim - Disallowance u/s 14A - voluntary disallowance u/s. 14A made by the assessee at the time of filing of return of income -Whether the CIT(A) is right in giving benefit of the amount of tax which the assessee has voluntarily paid ? - applicability of amendment to Section 14A - Whether CIT(A) is right in entertaining the plea of the assessee against the judgment of in the case of Goetze (India) Ltd. [2006 (3) TMI 75 - SUPREME COURT] AND Interpreting the amendment introduced w.e.f 02/06/2016 prospectively.
HELD THAT:- The appellate authorities are entitled to exercise their jurisdiction to consider the additional claim.The assessee cannot be made to suffer inadvertent mistake made at the time of filing of the return i.e; in case the assessee pays the tax which is not required to pay as per the Act, he can always reclaim the amount.
Owing to the above interpretation, we hold that the Ld. CIT(A) acted in a judicious manner and hence we decline to interfere with the order of the Ld.CIT(A) on these issues.
Applicability of amendment to Section 14A from 02/06/2016 - We are the view that due to the fact that there is a specific date mentioned regarding the applicability of the amended provisions hence the same cannot be said to be retrospective. The Assessing Officer is directed to compute the disallowance as per the rules applicable as on the date. Regarding the ruling that the Assessing Officer shall account on the those investments which have yielded exempt income, we find strength by the orders of the special Bench of ITAT in the case of Vreet Investment Pvt. Ltd. [2017 (6) TMI 1124 - ITAT DELHI] and also the order in the case of Prime Property Development Corp Pvt. Ltd. [2017 (11) TMI 2000 - ITAT MUMBAI]. We direct the Assessing Officer to compute the disallowance accordingly .
Capitalization of interest under section 36(1)(iii) - As we find that the assessee’s own resources are to the tune of 321.17 Crores which shows the sufficiency of interest free funds to meet the expenses. We rely on the judgments in the assessee’s own case wherein the judgment of Hon’ble Jurisdictional High Court in the case of Abhishek Industries [2006 (8) TMI 123 - PUNJAB AND HARYANA HIGH COURT] which was referred by the Assessing Officer in his order has been distinguished. Further in the case of Bright Enterprises [2015 (11) TMI 342 - PUNJAB & HARYANA HIGH COURT] clearly held that if interest free funds are available the a presumption would arise that the investments would be out of interest free fund generated or available with the company. Hence no disallowance under section 36(1)(iii) is called for. The order of the Ld. CIT(A) on this ground is confirmed.
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - amount deposited as security deposit - Operational Debt or not - existence of debt and dispute or not - HELD THAT:- As per Part-IV of Form 5, the principal amount due stated to be Rs.1,20,00,000/- and the date on which the amount became due is stated to be 21.09.2015. it is stated in Part-V that as per the terms of the LOI, interest free deposit inter alia of three months rental was payable within 7 days of signing the LOI and that pursuant to the condition, the Operational Creditor deposited a sum of Rs,1,20,00,000/- as deposit with the Corporate Debtor, being equivalent to three months of rent through RTGS on 08.09.2015.
Whether the deposit amounting to Rs,1,20,00,000/- is an Operational Debt as defined in Section5(21) of the Code? - HELD THAT:- The Learned Counsel for the Operational Creditor has pleaded that the amount of Rs.1,20,00,000/- was not an interest free deposit but an advance for providing consultancy, architectural design and furnishing services to the Operational Creditor. Clause 7 of the LOI clearly provides for an interest free security deposit (IFSD) equivalent to six months rental of which part deposit equivalent to three months’ rent is payable within 7 days of signing the letter of intent. The rental per month as per Clause 4 of the LOI is Rs.48 Lacs including Rs.8 lacs toward maintenance charges - the IFMS in respect of maintenance charge is separately provided for and is also payable when the maintenance agreement is executed. In these circumstances, three months’ rent as IFSD comes to Rs.40 lacs per month x 3 = Rs.1, 20, 00,000/-. It is accepted in Part V of form 5 (Para 1(iv)) that pursuant to the condition of the IFSD, the Operational Creditor deposited a sum of Rs.1,20,00,000/-. Therefore, the plea of the Learned Counsel for the Operational Creditor that the amount of Rs.1,20,00,000/- is not IFSD and an actually an advance cannot be accepted.
Thus, the plea of the Learned Counsel for the Operational Creditor that there was an advance of Rs.1,20,00,000/- in respect of provision of goods or services by the Corporate Debtor cannot be accepted - In view of the decision taken about that the amount of Rs.1,20,00,000/ is not an Operational Debt, the claims of the two parties regarding refund/forfeiture of the IFSD are not being examined. Similarly, the application for condonation of delay in filing the application under Section 9 of the Code as well as the issue of the limitation are not examined.
Thus, it is held that the amount of Rs.1,20,00,000/- is not proved to be an operational debt and therefore, the application under Section 9 of the Code is rejected.
Deduction u/s 80P - allowability of deduction on the interest income earned by the assessee - HELD THAT:- As no distinguishing feature in the facts of the present case or that of earlier years been pointed out by Revenue. Further Revenue has also not placed any material to demonstrate that the order of Tribunal in assessee’s own case in earlier years have been set aside / stayed or overruled by Higher Judicial Forum. In view of the aforesaid facts, we following the order of the Co-ordinate Bench of the Tribunal in assessee’s own case for earlier years [2018 (4) TMI 1931 - ITAT PUNE] and for similar reason hold that assessee is eligible for deduction u/s 80P of the Act on the interest earned by the assessee. Appeal of assessee is allowed.
Application to recall the order not been listed - order closing right of the Department to file written statement - HELD THAT:- Let the I.A. filed by the Income Tax Department be numbered. Income Tax department submits that he has filed an application for recall of the order [2018 (11) TMI 1911 - DELHI HIGH COURT] which has not been listed - as already filed his response to the suit by way of an affidavit filed by the Income Tax Department. Plaintiff submits that he has no objection if the said affidavit is taken on record. The order by which the right of the Department to file written statement was closed, is recalled. I.A. is disposed of.
Whether the Plaintiff - IFCI Factors Limited or the Income Tax Department has a preferred lien in respect of the fixed deposit lying with the Bank of India – Defendant No.1. - As Counsels for the parties submit that no oral evidence would be required in this matter. List on 22nd July, 2019 for hearing.
Seeking grant of bail - Smuggling - Charas - applicability of statement under Section 67 of the Narcotic Drugs and Psychotropic Substances Act, 1985 - HELD THAT:- The offence, if any, would be against the person who had agreed to carry that goods or the consignor or the consignee of the goods. In the present case, the Consignee Ravi Kumar has already been granted bail who was to receive the said goods. The driver of the vehicle or any other passenger who had got the goods loaded would be actually liable for the said offence.
The applicant has made out a case for bail as the twin conditions prescribed under Section 37(1)(b)(ii) of the 1985 Act appear to be satisfied - Let applicant Vindhyachal Pal be released on bail and on furnishing a personal bond and two sureties each of the like amount before the court concerned subject to conditions imposed - application allowed.
Addition u/s 68 - Unexplained share capital - CIT(A) has disallowed the same on the ground that the share application money, in question, was received in the earlier year and not in the current year and hence no addition can be made u/s 68 in current year - HELD THAT:- As DR could not controvert these factual findings. In the result, we uphold the same and dismiss this ground of Revenue.
Addition being loan taken from K.G. Construction - HELD THAT:- We find that the ld. CIT(A) after producing the letter of M/s K.G. Construction dated 13.02.2015 at Page No.9 of his order and giving a finding that some of the papers are apparently missing from assessment folder - Having regard to the papers furnished by the appellant in early stages of assessment, the reply of K.G. Construction confirming the transaction and its identity by furnishing copies of several relevant documents and also considering the fact that insistence on personal appearance of Directors of K.G. Construction was suddenly raised in the last half of March, 2015, we get the impression that the A.O was looking for some excuse to make some addition. A.O did not show any inclination to examine the partners of K.G. Construction in early stage of assessment proceedings or at least before reasonable length of time from the time barring dead line - AO had no reasonable basis to make addition of loans claimed to have been taken from K.G. Construction - Decided against revenue.
Condonation of delay in filing of claim form by the applicant - claim filed beyond the ninety days period specified in Regulation 12(2) of CIRP Regulations - HELD THAT:- In CA-727(PB)/2019 in the instant Corporate Insolvency Resolution Process we have condoned the delay and have issued direction to the RP to consider a claim without rejecting it on the ground of delay.
The application disposed off with a direction to the Resolution professional to take into consideration the claim made by the applicant on the basis of the award passed by the Arbitrator.
Addition on account of the peak cash deposit in his bank account as unexplained investment - assessee derived income from business of dairy products and interest on bank deposits - HELD THAT:- The contention of the AR although deserves to be accepted but in the absence of documentary evidence in support of amount returned to society, the ledger itself filed by assessee cannot be held as sufficient documentary evidence to reach any conclusion. But we find force in the argument raised by assessee that, the assessee is carrying on a small business of dairy products through cash transactions and in absence of any other source of income, the total deposits made in the assessee’s saving bank account can be considered as his business turnover which gets support from the observation of AO for the year under consideration and the AO’s observation in assessment of the preceding year where on identical facts, the trading turnover of “dairy business” of the assessee, cash deposits from cash transactions has been accepted as his business turnover and the profit disclosed in the return was accepted.
Cash deposit and withdrawal in the bank account was made regularly by the assessee during the year, it is very reasonable to say that the same was business turnover and therefore only gross profit addition is justified in the facts of the present case. Hence, we are not inclined to agree with the finding of the CIT(A) in observing that of peak cash deposits in bank account, endorsing the observation of the AO which was against the principle of ‘rule of consistency’ on comparison to the preceding Assessment Year and nature of retail milk business of the assessee.
In our considered opinion, such deposits in the bank account would certainly constitute business turnover of the assessee and the income disclosed in the return is justified as reasonable business profit for the year under consideration. Assessee appeal allowed.
Maintainability of petition - availability of alternative remedy of appeal - Mis-classification of the finished goods - Sikko Sol - HELD THAT:- Section 35 of the Central Excise Act, 1944, provides for an Appellate Forum. The Petitioner by invoking the provisions of Article 226 of the Constitution of India cannot circumvent the statutory provision and urge his Petition before this Court before appearing in the Appellate Forum. The mandate of the Statute is to be complied with in the first instance, thereafter the Petitioners are free to invoke the jurisdiction of this Court, if so advised.
Validity of notification dated 8.3.2019 - reservation of 16% seats for socially and educationally backward classes including Maratha community in the educational institutions in the State of Maharashtra - Maharashtra State Reservation (Of Seats For Admission In Educational Institutions In The State And For Appointments In The Public Services And Posts Under The State) For Socially And Educationally Backward Classes (SEBC) Act, 2018 - HELD THAT:- The impression created by the notification dated 8.3.2019 and also by the publication on 6.3.2019 of the list of the applicants wherein separate category of SEBC candidates was shown was not about the reasonable pointer towards the application of the provisions of the SEBC Act, 2018 to the present admission process and was only of the intendment of the State Government to make this Act applicable only in accordance with its provisions. The Act contains a transitory provision like Section 16 and it is already found as to how it exempts the current admission process.
In terms of the definition of “fact” given in Section 3 of the Indian Evidence Act, a fact means and includes anything, any state of things or relation of things, capable of being perceived by the senses or of any mental condition of which any person is conscious. This definition would show that the fact is something which could be perceived by the sensory organs or realized as being existent through the power of mind. This definition thus excludes any mental forays into the world of imagination or fantasy. It also keeps away an opinion as regards the interpretation of a document. When we again consider the notification dated 8.3.2019, we would find that there is no express declaration made therein that 16% reservation for SEBC candidates be provided even in current admission process. That means there is no fact existing or established and, therefore, there can be no admission of a nonexistent fact. This is how the so called admission of the petitioners would be treated in law. At the most, it could be considered to be the own interpretation of the petitioners and the interpretation is always a question of law which cannot be decided on the basis of admission of parties. So we find no merit in the said contention raised on behalf of the respondent No.1.
It was only from 27.3.2019 and onwards, the date on which the revised provisional seat matrix was published, that the petitioners actually learnt about the application of the provisions of the SEBC Act, 2018 to the present admission process and this was what provided to them the cause of action to approach this Court and they did approach the Court on or about 4th April, 2019, which was with a reasonable dispatch. There is, therefore, neither any delay nor any latches on the part of the petitioners in approaching this Court. The argument in this regard is, therefore, rejected.
In the present case, as per the information brochure of January 2019, the whole admission process is still going on and is not completed. The declaration of list of selected candidates of second round is to be made upto 26.4.2019, the last date of joining respective colleges for second round is upto 3rd May, 2019 and there are further stages of the admission process, last of which relates to the last date for filling seats at college level round upto 18th May, 2019. This process is not yet over and, therefore, it can be reasonably seen that these petitioners can be allowed to participate in the admission process without causing any prejudice to anybody.
The interpretation of the provisions of Section 16(2) of the SEBC Act, 2018 is already given stating that this provision of law would exempt the present admission process from the applicability of this Act which came into force on 30th November, 2018. So, the requirement of law is that this Act must not be applied to the present admission process and the requirement needs to be followed by the authorities.
It is directed that the notification dated 8.3.2019, insofar as medical admission process is concerned, shall be applied to the medical admissions the procedure for which has started or would start on or after 30th November, 2018, subject to result of any other writ petition, if pending, and the notification would have no application to the present medical admission process 2019 which began w.e.f. 16th October, 2018 and 2nd November, 2018 respectively - it is also directed that the revised provisional seat matrix published on 27.3.2019, insofar as it makes a provision for the category of SEBC candidates, being illegal, shall not be given effect to for the limited purpose of SEBC reservation in current admission process. The respondents, however, would conduct the admission process and complete it in accordance with applicable law, rules and orders, in force, before commencement of the SEBC Act, 2018.
Selection/promotion against the vacancies in the recruitment year 2008 - convention of review D.P.C. - accrued or vested right - whether the Division Bench of the Orissa High Court was justified in directing the State to convene a review D.P.C. for considering the case of the contesting Respondents and other eligible officers, and directing it to complete the recruitment process for recruitment year of 2008 to the 150 vacant posts?
HELD THAT:- The contesting Respondents cannot claim an accrued or vested right for selection or promotion to OAS Class-II posts in the year 2008, merely on the basis of their names being forwarded by the respective Departmental Authorities - When the recruitment process for 2008 was initiated vide Letter dated April 28, 2008 by the State, the extant Rules and Regulations occupying the field for selection and promotion to OAS Class-II posts were the OAS Class II Rules, 1978 and the OAS Class II Regulations, 1978.
Rule 3 of the OAS Class II, Rules 1978 provided that recruitment to OAS Class II posts was to be made by three methods-first, direct recruitment by competitive examination [Rule 3(a)]; second, promotion from amongst Gazetted Officers of a certain class [Rule 3(b)]; and third, selection of non-Gazetted Officers [Rule 3(c)] - The proportion of candidates to be recruited by the methods specified above as per Rule 8 of the OAS Class II Rules, 1978 was-50% by direct recruitment, 30% by promotion, and 20% by selection.
In the present case, the names of 559 candidates, including the contesting Respondents, were merely recommended by their respective Departmental Authorities Under Regulation 6. The recruitment process did not proceed any further in accordance with Regulations 7, 8, 9 and 10. No final list of selected candidates was placed by the Orissa Public Service Commission before the State Government for the purposes of appointment as against the vacancies of 2008 - the contesting Respondents had not acquired an accrued or vested right of selection or promotion to OAS Class-II posts in accordance with the OAS Class II Rules, 1978 and the OAS Class II Regulations, 1978, since their names had never been considered for selection or promotion beyond the stage contemplated Under Regulation 6.
Tthe judgment of the Division Bench is liable to be set aside since the contesting Respondents did not have a vested or fructified right of promotion to OAS Class II posts which had arisen during the recruitment year 2008. The names of the contesting Respondents were merely recommended for consideration. In the meanwhile, in 2009 the State had re-structured the cadre, and abolished the OAS Class II cadre. The re-constituted cadre viz. the Orissa Revenue Service Group 'B' cadre came in its place. Hence, the direction of the Division Bench to appoint the contesting Respondents in the vacancies which had occurred in the abolished cadre, in accordance with the repealed 1978 Rules, was contrary to law, and liable to be set aside.
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