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Showing 61 to 80 of 2364 Records
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2018 (7) TMI 2308
CENVAT Credit - capital goods - M.S.Plates - MS Sheets/Aluminium Coil - Joist/Square/joist Channel/HR Plates/Shapes & Sections/ MS Channels - Angles - welding electrodes CRSS Patti/HRSS Plates/HR Coil/Sheets etc. - period 15.5.2006 to 31.3.2010 - Extended period of limitation - HELD THAT:- There were divergent views by this Tribunal on the issue of availability of Cenvat credit on the items in question. Initially, the said issue has been settled by the larger bench of this Tribunal in the case of VANDANA GLOBAL LTD. VERSUS CCE [2010 (4) TMI 133 - CESTAT, NEW DELHI (LB)] wherein it has been held that the Cenvat credit is not available to the appellant. As the said decision of the Larger Bench of this Tribunal in the case of Vandana Global Limited is also set aside by the Hon’ble Chhattisgarh High Court in SCANIA STEELS AND POWERS LTD. VERSUS COMMISSIONER [2011 (9) TMI 972 - CHHATTISGARH HIGH COURT], in that circumstance, it is held that as the whole demand has been raised by invoking the extended period of limitation, the demand is not sustainable as barred by limitation.
Appeal allowed.
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2018 (7) TMI 2307
Maintainability of appeal in HC - substantial question of law - finding of Tribunal that all the companies which have earned profit at less than 6% should be excluded for consideration of comparable companies - HELD THAT:- We do not find any substantial question of law arising in view of the recent judgment of this Court in Pr. Commissioner of Income Tax, Bangalore and Another Vs. M/s. Softbrands India P. Ltd [2018 (6) TMI 1327 - KARNATAKA HIGH COURT] wherein it is held that in these type of cases, unless an ex-facie perversity in the findings of the learned Income Tax Appellate Tribunal is established by the appellant, the appeal at the instance of an assessee or the Revenue under Section 260-A of the Act is not maintainable.
Nature of expenditure - payment of compensation paid by the appellant - Revenue or capital expenditure - HELD THAT:- No substantial question of law would arise in this regard to Question No. 2 also because the expenditure paid by the Assessee Company to the other party for withdrawing from the Contract for purchase of Immovable Property i.e. land in question, on which the Appellant Assessee wanted to establish the infrastructural facilities for the business has been rightly held to be a ‘Capital Expenditure’ and the same cannot be said to be a ‘Revenue Expenditure’ incurred in the ordinary course of business.
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2018 (7) TMI 2306
Refund of excess amount paid - monthly netting - refund was rejected finding no provision to net the quantity transferred on a monthly basis - HELD THAT:- On the basis of an audit report by the Comptroller and Auditor General, the Ministry has taken a decision to permit monthly netting, which permission was granted only after the impugned orders in the above appeals by the Customs, Excise & Service Tax Appellate Tribunal [CESTAT]; which confirmed the orders of the first appellate authority - the subsequent appeals were remanded by the CESTAT itself to the original authority resting on the decision taken by the concerned Ministry.
It is deemed fit that the questions raised herein be left open and the matter remanded back to the original authority for re-working the issue as per the permission granted in the clarification issued by the Ministry - appeal disposed off.
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2018 (7) TMI 2305
Income taxable in India - advertising, distribution income being the primary source of income -Permanent Establishment in India in respect of advertisement revenue - assessee company is a tax resident of Mauritius and is engaged in the business of telecasting on TV channels(TEN Sports) - DTAA between India and Mauritius - as submitted Taj TV is carrying on business from outside India and it does not have business connection in India - HELD THAT:- The issue of PE and consequent taxability of income in India is no longer res integra. The ITAT, in assessee’s own case for AY 2006- 07 [2016 (12) TMI 1291 - ITAT MUMBAI] after considering the ratio laid down in the case of DIT vs Morgan Stanley & Co. [2007 (7) TMI 201 - SUPREME COURT] held that since Taj India is being remunerated at arm’s length price, no further income or profit can be said to be attributable to the assessee in India from its PE.
Thus we are of the view that Taj India does not constitute agency PE in terms of India Mauritius DTAA. Consequently, no further income / profit can be said to be attributable to the assessee in India from its PE, since Taj India is being remunerated at arm’s length price. Accordingly, we direct the AO to delete additions made towards computation of income attributable to the assessee in India.
TDS u/s 195 - programming cost paid to various non residents and also payments made to M/s PanAM Sat International System Inc. and other non residents towards transponder charges u/s 40(a)(i) for failure to deduct tax - HELD THAT:- In this view of the matter and consistent with the view taken by the co-ordinate bench in assessee’s own case for earlier years [2016 (12) TMI 1291 - ITAT MUMBAI] we direct the AO to delete addition made towards disallowance of programming cost and transponder charges u/s 40(a)(i) - Decided in favour of assessee.
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2018 (7) TMI 2304
Service PE in India - Article 5 of the India UK Double Taxation Avoidance Agreement [DTAA] - receipts on account of central costs recharges and structural tests - bilateral agreement in force between the assessee and JCB India - HELD THAT:- As mentioned elsewhere, except for routing the royalty payment through JCB Investments, the assessee has received everything as per bilateral agreement existing in earlier years minus 0.05%. Therefore, we do not find any distinguishing fact as contended by the ld. AR. Respectfully following the findings of the coordinate bench [2015 (5) TMI 607 - ITAT DELHI] we hold that JCB India a Service PE of the assessee. Ground No. 1 with its sub-grounds is dismissed.
Whether royalty is not effectively connected to the alleged Service PE of the assessee? - As mentioned elsewhere in the earlier years, this issue arose when JCB India [Service PE] used to make payment directly to assessee and the Tribunal vide its order [2014 (4) TMI 887 - ITAT DELHI] has held that amount of royalty received by the assessee arises out of IP Rights which are in the nature of right or property but the same cannot be considered under para 6 of Article 13 because it is not effectively connected with the service PE of the assessee in India.
Since there is no difference in the facts and circumstances of the royalty payment, we do not find any reason to differ from what has been held by the Coordinate Bench [supra]. Respectfully following the same, we hold that royalty received by the assessee cannot be considered under Para 6 of Article 13 because it is not effectively connected with Service PE of the assessee in India.
Receipts on account of central costs recharges and structural tests - A perusal of the bilateral agreement and tripartite agreement shows that royalty shall be equal to the royalty received by JCB Investments from JCB India under the licence and from any other permitted sub-licencee of JCB Investments less 0.5%. It can be seen that the entire royalty amount is passed on to JCBE through JCB Investments less 0.5%. We have no hesitation to hold that JCB Investments is nothing but a pass through entity.
A perusal of the agreements clearly and explicitly lead out that the delivery of technical documentation and making available of technical personnel as set out in clause (iii) and (iv) of the TTA shall remain unaffected by this agreement and shall continue as rights and obligations between JCBE and JCB India.
Since the impugned receipts are ancillary and subsidiary to the application or enjoyment of the right, property or information for which the royalty payments were received by the assessee, in our considered opinion such receipts would fall under sub-clause (a) and Article 13(4) and would be taxable as FTS - we further find that sub-clause (c) of Article 13(4) which entails ‘make available’ clause would, therefore, not be applicable.
The disputed receipts are in relation to the payment received by the assessee as royalty from JCB Investments which has received it from JCB India - substance shall get precedence over the form. In our considered view, the impugned receipts are ancillary and subsidiary to the application or enjoyment of the right, property or information for which the royalty payment were received by the assessee through such receipts would fall under clause (a) of Article 13(4) and would be taxable as FTS and the services provided by the assessee are to be considered as having been made available to the recipient of the services. Substance will rule over form.
The common meaning of the word ‘make available’ is merely offering or made accessible to the other party and it never meant that the other party should be trained or made expert in such technical knowledge. If such is the case, it would be absurd for a person to make other person expert of its core competency and a situation will arise that the recipient of services would not look again to the service provider when these services are needed in future. In the context of bilateral vis a vis tripartite agreement, the service provider by the assessee have to be considered as having been ‘made available’ to the recipient of service and we hold accordingly. Ground No. 3 is dismissed.
Reimbursement towards salary costs and other expenses of seconded employees - As we find that in the case of JCB Investments also, JCB India has been treated as service PE on account of employees seconded by the assessee to JCB India. In order to determine the income of service PE on account of employees seconded by the assessee to JCB India, the Tribunal has restored back the matter to the file of the Assessing Officer for correct assessment of the profits to be attributed to the Service PE and the AO, while giving effect to the directions of the Tribunal has framed the order u/s 254/143(3) of the Act. AO is directed to decide this issue in accordance with the directions given by the co-ordinate bench in the case of JCB Investments [2015 (5) TMI 607 - ITAT DELHI]. The AO is further directed to see that the same income is not doubly taxed in the hands of the appellant. This issue is, accordingly, treated as allowed for statistical purposes.
Attribution of income in India - Assessee contended that in the hands of JCB Investments, the Assessing Officer has already made necessary attribution on account of alleged Service PE in India, therefore, question of attribution will not survive in the hands of the assessee - HELD THAT:- We have already mentioned elsewhere that during the year under consideration, the assessee has received everything from JCB India minus 0.05% which was retained by JCB Investments through which entire payments have been received. We have already held that substance will prevail over form. In our understanding of the facts of the case in hand, we are of the considered opinion that the amount received by the assessee after deduction of 0.05% has to be considered separately for the purposes of attribution of income in India - direct the AO to do the attribution as done in the case of JCB Investments after giving opportunity of being heard to the assessee. The AO is further directed to reduce the income already taxed in the hands of JCB Investments to avoid double taxation of the same income. This issue is also allowed for statistical purposes.
Charging of interest u/s 234B - We find that an identical issue was considered by the Tribunal in assessee’s own case [2014 (4) TMI 887 - ITAT DELHI] - We direct the Assessing Officer to relieve the assessee from any interest liability u/s 234B of the Act.
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2018 (7) TMI 2303
Classification of goods - purchase and sale of crockery and tray made from melamine - whether melamine tray treated as a crockery item, or not - HELD THAT:- Crockery can include all forms of dishes such as plates, as well as serving platters, bowls, and dishes that are used to hold condiments, such as a gravy bowl. Traditionally, crockery is applied to any type of dinnerware that is made from natural materials. This could include plates, cups, and serving dishes that are composed of clay that has been fired and prepared for use on a recurring basis. While technically this would also include fine china and porcelain dinnerware. Crockery was usually a term applied to dishes that were intended for use for more casual situations, such as a simple family meal - Purists tend to also omit some of the modern types of dinnerware from the definition of crockery. Plastic dishes, or dinnerware that is manufactured using other synthetic materials that make the dishes difficult to break may not be considered proper crockery, even though they are usually intended for regular use in a casual setting. However, as these forms of dishware have become more common in many households, their acceptance as meeting the basic definition of crockery has become more common.
So far as melamine is concerned it is a white crystalline compound made by heating cyanamide and used in making plastics - Further a plastic used chiefly for laminated coatings, made by copolymerizing melamine with formaldehyde.
There is no reason to interfere in the matter, hence the revision filed by the Commissioner has no legs and is accordingly dismissed.
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2018 (7) TMI 2302
Eligibility of deduction u/s. 80P(2)(a)(i) - assessee is a primary agricultural credit society registered under the Kerala Cooperative Societies Act, 1969 - HELD THAT:- In view of the judgment of Chirakkal Service Co-op Bank Ltd. [2016 (4) TMI 826 - KERALA HIGH COURT] wherein held primary agricultural credit societies, registered as such under the KCS Act; and classified so, under that Act, including the appellants are entitled to such exemption - we hold that the assessee - Society is entitled to the benefit of deduction u/s. 80P(2) of the Act for both the assessment years. It is ordered accordingly.
Interest earned on investment made with sub-treasuries and bank deposits - Tribunal had decided the issue in favour of the assessee in assessee’s own case [2016 (7) TMI 1405 - ITAT COCHIN] concerning the assessment year 2009-10 - we hold that the CIT(A) is justified in directing the Assessing Officer to grant deduction in respect of interest income earned on investment in sub-treasuries and bank deposits u/s. 80P(2)(a)(i)
Appeals filed by the Revenue are dismissed.
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2018 (7) TMI 2301
Imposition of condition of payment of Rs. 94,000/-, 94,000/- and 54,000/- respectively, under Section 87 of Companies Act - case of petitioner is that it had taken three loans from State Bank of India amounting to Rs. 10,00,000/-, 6,00,000/- & 3,00,000/- respectively against movable/immovable properties not specifically pledged for which a charge was created and filed with the respondent no. 2 ROC - HELD THAT:- It is noticed that undisputedly there was a delay in complying with the requirement of filing of e-forms for satisfaction of charge with the respondents - In the present case the petitioner has disclosed that delay had taken place because there was change in entire management of the company, therefore, the default had taken place for the bonafide reason.
The impugned orders reveal that respondent no. 1 has also reached to the conclusion that delay was caused due to inadvertence and has found it to be just and equitable to grant relief of condonation of delay and has accordingly condoned the delay. But while condoning the delay the respondent no. 1 has imposed the condition of payment of Rs. 94,000/- in a case where the loan was of Rs 10,00,000/-, Rs. 94,000/- in another case where the loan was of Rs. 6,00,000/- and Rs. 54,000/- where the loan was of Rs. 3,00,000/- - Undisputedly the loan amount was already repaid in the year 2006 itself and there was only a default in non complying with the requirement of filing of e-forms for satisfaction of the charge. In these circumstances the condition of payment of such a high amount imposed by respondent no. 1 is not reasonable in terms of Section 87 of the Act. Under Section 87, the condition which is required to be imposed should be just and expedient.
In the considered opinion of this court in the case of default where the loan was of Rs. 10,00,000/- just and proper condition would be to condone the delay subject to payment of Rs. 45,000/-; in the case where the loan was of Rs. 6,00,000/-, to condone the delay, subject to payment of cost of Rs. 30,000/-; and in the case where the default was of Rs. 3,00,000/- to condonue the delay, subject to payment of cost of Rs. 20,000/- .
The writ petition is disposed off.
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2018 (7) TMI 2300
Seeking to issue a writ of mandamus (writ issued by a superior court commanding the performance of a specified official act or duty) - seeking direction to respondents to issue detention certificate in connection with certain containers, which had been detained by issuing an order u/s. 5 of the Customs Act,1962 - permission denied to export of goods due to which huge amount and ground rent/demurrages was paid by petitioner (at no fault of petitioner).
HELD THAT:- here is no dispute that the petitioner intended to export the goods of 87 containers from Kandla Port Trust. As per the provisions of The Customs Act, the petitioner after following the procedure, ultimately got clearance certificate for all 87 containers, which were issued by the Customs Officer under the provisions of Sections 50 and 51 of the Customs Act, before 27.6.2006. Since the shipment was not available (as claimed by the petitioner in the memo of the petition and not denied by the respondent) remaining 67 containers could not be physically exported beyond the territory of India and therefore, while dealing with the applicability of notification dated 27/06/2006, Division Bench of this Court as well as Hon’ble Apex Court, the action of the respondent authorities in not permitting the petitioner to load the goods, held to be illegal - By not permitting the petitioner to export the goods, at no fault of the petitioner, he was paying ground rent/ demurrages to respondent Nos.4 and 5, whose containers were used for storing the goods for export.
Even though specific directions were issued, the respondent authorities were not permitting the petitioner to export the consignments. Though specific request was made by the petitioner and petitioner had to incur huge expenses towards ground rent/ demurrages towards such attitude of the officers and when the action of respondent authorities from the beginning was declared illegal, and are required to be deprecated and are bound to face the consequences.
In case of SHIPPING CORPN. OF INDIA LTD. VERSUS CL. JAIN WOOLEN MILLS [2001 (4) TMI 83 - SUPREME COURT] the Hon’ble Apex Court has held that even confiscation of goods, which ultimately find out to be unsuccessful, the Court has held the same as illegal, parties would be entitled for demurrages, etc. - Similarly in unreported decision rendered in the case of Unisilk Ltd. [2013 (4) TMI 237 - GUJARAT HIGH COURT], Division Bench of this Court has considered the same as having similar facts and held that persons would be entitled for demurrages.
Respondent No.2 is hereby directed to pay the demurrages, after examining the details supplied by the petitioner within a period of eight weeks from the date of receipt of copy of this order, with interest at the rate of 6% per annum from 24/06/2006 till the amount is paid - petition allowed.
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2018 (7) TMI 2299
Cancellation of registration certification of selling dealer - statutory ‘C’ Form issued is not denied - HELD THAT:- The question urged is covered by the ruling of this Court in Jain Manufacturing (India) Pvt. Ltd. v. The Commissioner Value Added Tax, [[2016 (6) TMI 304 - DELHI HIGH COURT]] and M/s. Giriraj Timber Pvt. Ltd. vs. Commissioner of Delhi Value Added Tax [[2017 (5) TMI 1802 - DELHI HIGH COURT]] under identical circumstances, where it was recommended to restore C-forms.
Petition allowed.
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2018 (7) TMI 2298
Levy of penalty u/s 271(1)(c) - Defective notice u/s 274 - voluntary disclosures of unexplained income - during the course of assessment proceedings - assessee in her return of income has not disclosed the correct receipts since there was difference in Form 26AS and income declared - as per revenue voluntary disclosure does not release the assessee from the mischief of penal proceedings - HELD THAT:- A perusal of the notice issued for levied of penalty shows that the inappropriate words in the said notice have not been struck off and the notice does not specify as to whether penalty is being levied for concealing the particulars of income or for furnishing inaccurate particulars of such income.
As in the case of CIT vs. Manjunatha Cotton and Ginning Factory [2013 (7) TMI 620 - KARNATAKA HIGH COURT] held that where the inappropriate words in the notice issued for levy of penalty are not struck off and the notice does not specify as to whether the assessee has concealed its particulars of income or furnished inaccurate particulars of income, penalty u/s 271(1)(c) is liable to be deleted.
Since in the instance case also, AO has not struck off the inappropriate words and the notice does not specify as to whether the penalty is levied for furnishing inaccurate particulars of income or for concealing particulars of income, therefore, penalty levied by the AO and sustained by the ld. CIT(A) is liable to be deleted - Decided in favour of assessee.
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2018 (7) TMI 2297
TP Adjustment - Incurring of AMP expenditure - whether the TPO was justified in making ALP adjustment in respect of alleged expenditure incurred on AMP functions? - HELD THAT:- The important fact to be taken into consideration is that the assessee was assured of minimum return on distribution business. These facts, no doubt, trigger an enquiry into the real nature of relationship between assessee and its AE i.e. whether it is distributor or a trader. The real economic substance of transaction is required to be found out having regard to the actual conduct of the parties.
Having regard to the actual conduct of the parties and the real economic substance of the transaction, it requires to be established whether there is any international transaction of AMP expenditure. Needless to mention, the Hon’ble Delhi High Court in a series of judgments subsequent to decision of the Sony Ericsson Mobile Communications India P Ltd. vs. CIT [2015 (3) TMI 580 - DELHI HIGH COURT] AND Yum Restaurants (India) Pvt. Ltd. vs. ITO [2016 (1) TMI 582 - DELHI HIGH COURT] held that AMP expenditure is international transaction but determination of ALP was restored to the file of the AO for the purpose of detailed examination of the agreement between the assessee and its AE to ascertain whether any part of AMP expenditure is for the purpose of creating marketing intangibles for AE of the assessee therein. If it is shown that AMP expenditure is an international transaction, then further question of determination of ALP of such international transaction would arise.
In the present case also TPO had not brought anything on record to show existence of international transaction whereby the assessee was obliged to incur AMP expenditure for the purpose of promoting brand, intangible of its AE. Similarly, the assessee-company also has not furnished FAR analysis of AMP functions in its TP study.
Thus the matter requires remission to the TPO for undertaking fresh analysis to establish existence of international transaction in respect of AMP expenditure and true nature of transaction between the appellant and its AE. After due analysis of FAR of the AMP functions carried out by the appellant and having regard to the actual conduct of the appellant vis-àvis its AE and economic substance of the transactions between the appellant and its AE, if the TPO is of opinion that there existed an international transaction in the form of AMP functions, then, to undertake the exercise of determination of ALP by adopting a suitable method of compensation to the appellant for performing the AMP functions of its AE. Appeal filed by the assessee allowed for statistical purposes.
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2018 (7) TMI 2296
Money Laundering - criminal conspiracy - preparing the banker's cheques/demand drafts in bulk in the name of the different kotedars for lifting PDS foodgrains and subsequently by selling the same in black market in connivance with other co-accused for wrongful gains to themselves and causing wrongful loss to the Government exchequer - HELD THAT:- The PMLA, 2002 was promulgated/came into force on 01.07.2005, vide G.S.R. 436(E), dated 1stJuly, 2005, published in the Gazette of India, Extra, Pt. II, Sec. 3(i), dated1st July, 2005. Therefore, the following was position, as on 1st July, 2005as regards inclusion of offences in Part A or Part B of the schedule appended to the PMLA, 2002. (Only such sections are being taken into consideration of I.P.C. and P.C. Act, which are alleged to have been committed by applicant/accused) - In Part B of the schedule, one of sections of I.P.C. in question only i.e. Section 467 I.P.C. which pertained to forgery of a valuable security will or authority to make or transfer any valuable security, or to receive any money etc. was made punishable under PMLA, 2002.
It is apparent that the offence under Section467 was punishable under PMLA of 2002 with effect since 1st July, 2005while the allegations against the present accused relate to the period2004-05 and 2005-06, hence the argument of the learned counsel for the applicant that the cognizance taken against the accused applicant could not have been taken for his having committed offence under Section 467 I.P.C. does not hold water as the same was already made punishable under the PMLA of 2002 way back in 2005. It is settled law that if eve none of the offences under which the charge is found to have been made out, then it cannot be denied that cognizance could have been taken by the Court concerned for having committed an offence under PMLA of 2002. If offence under certain other sections of I.P.C. or P.C. Act are found not made out in respect of the present accused during the period in question due to penal provision not being available then the said fact maybe taken into consideration by the Trial Court at the time of trial and take appropriate decision in that regard.
As regards other objections that the appeal against the attachment of the properties of the applicant/accused was pending before a Appellate Authority and that the order passed by the learned Judge of C.B.I. Court had been stayed by the High Court, Lucknow Bench hence the cognizance under PMLA ought to have postponed by the learned Trial Court till final decision in that case, does not hold good as there is no legal bar to initiating proceedings under PMLA under such a situation.
Application dismissed.
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2018 (7) TMI 2295
Disallowance u/s 36(1)(viia)(c) - Provision of Bad Debt written off u/s 36(1)(viia)(c) by considering the closing balance in the Provision as credit balance - HELD THAT:- AO has disallowed the claim of the assessee with the statement that the assessee has already taken a lot of time and the case was time barred on 31st March, 2014. Accordingly a final opportunity was given to the assessee to give details by 18.03.2014. No reply was received by the AO and accordingly the claim of the assessee was disallowed considering the fact that there was no new provision for bad and doubtful debts made by the assessee.
Now the assessee has filed the details of provision made for bad and doubtful debts and submitted that the assessee has made fresh provision though the written back of provision was more than the new provision made during the year, therefore, there was a credit balance in the NP Account.
Assessee did not furnish the relevant details before the authorities below, we set aside this issue to the record of the AO for verification of necessary details and particularly the fact of new provision made by the assessee during the year under consideration and then decide the issue as per law. Needless to say, the assessee be given an opportunity of hearing before passing the fresh order - Appeal of the assessee is allowed for statistical purpose.
MAT provisions applicability in the case of the financial corporations as the accounts are not maintained as per Schedule-VI of the Companies Act - HELD THAT:- Identical issue was decided by the Hon’ble Jurisdictional High Court in assessee’s own case for the earlier assessment years 2017 (7) TMI 1196 - RAJASTHAN HIGH COURT as held question of law which has been framed is very clear whether the respondent assessee will be governed u/s 115JA read with Section 2(18)(a). On a plain reading as reproduced above and in view of forgoing conclusion and even as per statement of Mr. Mathur, it will not be covered. However, he has tried to take support of Section 43 which is misconceived. While interpreting the taxing statute, the Court has to rely upon the taxing statute and not any other provisions. - Decided in favour of assessee.
Disallowance of expenditure made on account of prior period - AO has made a disallowance on account of rent paid of the earlier years to the Directorate of Estate, Government of Rajasthan for Bikaner House expenses, New Delhi, on the ground that these expenses pertain to the earlier years and, therefore, cannot be allowed for the year under consideration - CIT-A deleted the addition - HELD THAT:- CIT (A) has given the finding that the demand was raised by the Government of Rajasthan during the year under consideration and, therefore, the same was crystallized during the year itself. Once the fact of raising the demand by the Government of Rajasthan during the year has not been disputed by the AO, therefore, we do not find any error or illegality in the order of ld. CIT (A) in allowing the claim of expenditure on the ground that the same is crystallized during the year under consideration.
Addition on account of the Provision made against NPA which was written back during the year under consideration - assessee challenged the action of the AO but could not succeed as the CIT (A) has confirmed the addition made by the AO on the ground that the assessee has not furnished the relevant year-wise details to substantiate its claim - HELD THAT:- As directed the AO to reconsider the claim of the assessee for the assessment years 2011-12 and 12-13 after verification of the new provision made during those years. Further, if any part of the amount which is written back by the assessee during the year under consideration was already allowed in the earlier assessment years then to that extent the written back amount has to be included in the income of the assessee. The amount of written back of provision which was never allowed by the AO in the assessment proceedings cannot be added to the income of the assessee.
Accordingly we set aside this issue to the record of the AO for verification of all the details relevant to this issue as how much of the amount written back during the year under consideration was allowed in the earlier years and only to that extent the same has to be added to the income of the assessee. Assessee be given an opportunity of hearing before passing the fresh order.
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2018 (7) TMI 2294
TP Adjustment - comparable selection for Software services - HELD THAT:- Persistent systems Ltd. Ld. - Assessee has developed software during the year, and has earned royalties from sale of products. Assessee has earned revenues from Licensing of products. It is also observed from the notes to the accounts of this company that the segment information has been provided on consolidated financial statements. It is also observed that assessee owns the software developed by it on which depreciation is claimed. Thus this company has been characterised itself as engaged in providing outsourced product development services to independent software vendors and enterprises. It has been characterised to having earned significant portion of its revenues from export of software services and products. This function, the assets owned by this company and the risk assumed are not comparable with that of the present assessee and hence has to be excluded from the final list of comparable.
Wipro Technology Services Ltd disqualifies to become a comparable uncontrolled transaction for the purposes of inclusion in the final list of comparables under Rule 10B(1)(e)(ii). We, therefore, direct removal of this company from the list of comparables.
TATA Elxsi Ltd. - Functions performed by this company under software development services are basically on the basis of research and development. It is also observed that there is no segmental information regarding the same. On perusal of the audited reports of this company, we are of the considered opinion that this company is not performing services on the basis of contract as per the requirements of the clients but is into innovative development of its own.
Staffing services - Comparable selection - HCCA Business Services Pvt. Ltd company is into services providing human resource to companies. It is also observed that this company has only staffing services and therefore entire revenues earned by this company is from providing manpower as per the agreements with its customers. Under such circumstances we do not find any functional dissimilarity of this company with that of the assessee before us. Accordingly we uphold the inclusion of this company in final list of comparables.
Ma Foi Management Consultants Ltd - This company was rejected by Ld.TPO due to different financial year ending. It is also observed that Ld.TPO has not verified whether quarterly financial details could be extrapolated to match the financial year ending of assessee. We also observe that functions performed by this company are identical to functions performed by assessee, and therefore could be considered as a comparable. Merely because it has a different financial year ending cannot be a sole reason to reject it as a comparable. We therefore set aside this comparable to Ld.TPO to verify having regard to extrapolating quarterly details of this comparable.
Nirbhay Management Services Pvt. Ltd. - We accordingly set aside this issue to ld.TPO to verify the FAR analysis of this company. Assessee is directed to provide all necessary information/details regarding TP report, audited accounts for verification. Ld.TPO is directed to verify the same for considering it for the purposes of comparability.
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2018 (7) TMI 2293
Ban on import of pet coke - evaluation of pollution load of pet coke versus possible alternatives - HELD THAT:- On a reading of the affidavit, it is clear that a meeting was held by the Ministry of Environment, Forest and Climate Change along with officers of the Ministry of Petroleum and Natural Gas and EPCA and discussions were also held with the Directorate General of Foreign Trade.
A consensus decision has been taken that the use of imported pet coke all over the country may be permitted only in the following industries : cement, lime kiln, calcium carbide and gasification. It is stated that this would be in compliance with the WTO norms and these industries may be permitted to import pet coke for use as a feedstock or in the manufacturing process and not as a fuel.
Since the decision to permit limited import of pet coke has been taken by consensus by all the authorities mentioned above and since the time already fixed by us expired on 30.06.2018, we direct that the decision taken in para 1.10 in terms of the Minutes dated 18.07.2018 be notified and implemented with immediate effect - Report disposed off.
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2018 (7) TMI 2292
Maintainability of petition - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - it is alleged that the Corporate Debtor made frivolous attempt to deny the admitted dues and default - HELD THAT:- The Adjudicating Authority came to a definite conclusion that there is 'existence of dispute' and refused to admit the application under Section 9 of the I&B Code, while we have noticed the plea taken by the appellant that no reply pursuant to demand Notice was given by the 'Corporate Debtor', but that will not take away the right of 'Corporate Debtor' to take plea of 'existence of dispute' before the Adjudicating Authority at the time of admission of application under Section 9 of the I&B Code.
Appeal dismissed.
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2018 (7) TMI 2291
Maintainability of appeal before High Court on low tax effect - Whether case falls within purview of circular of Central Board of Direct Taxes No. 3 of 2018 dated 11.7.2018? - HELD THAT:- As the tax effect involved in the present Tax Appeal is less than Rs.50 lacs, considering the recent Circular issued by the CBDT dated 11/07/2018, being Circular No.3/2018, Mrs Kalpana Raval, learned Advocate appearing on behalf of the revenue does not press the present Tax Appeal. Under the circumstances, on the aforesaid ground alone, present Tax Appeal is dismissed as not pressed.
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2018 (7) TMI 2290
Maintainability of petition - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of dispute or not - HELD THAT:- In the present case, as we find that there is a debt and the ‘Corporate Debtor’ defaulted in payment of debt to the ‘Financial Creditor’. The application being complete, it is held that the Adjudicating Authority rightly admitted the application.
There are no ground to interfere with the impugned order dated 12th March, 2018 - appeal dismissed.
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2018 (7) TMI 2289
TP Adjustment - comparable selection - ALP - substantial question of law or fact - Whether Tribunal has erred in holding the Cost Plus Method as the Most Appropriate Method for the international transaction relating to the contract manufacturing activity of the appellant in light of the comparable companies chosen by the TPO? - HELD THAT:- The controversy involved herein is no more res integra in view of the decision of this Court in M/s.Softbrands India Pvt. Ltd.[2018 (6) TMI 1327 - KARNATAKA HIGH COURT] wherein it has been observed that unless the finding of the Tribunal is found ex facie perverse, the Appeal u/s. 260-A of the Act, is not maintainable.
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