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Showing 61 to 80 of 1194 Records

• 2013 (8) TMI 1138
  
  Issues Involved:
  1. Deleting the addition made u/s 40(a)(ia) of the I.T. Act.
  2. Deleting the addition on account of Benami Account and interest income.
  3. Deleting the addition on account of unexplained amount deposited in bank.
  4. Restricting the addition on account of unexplained cash credit u/s 68 of the I.T. Act.
  
  Summary:
  
  Issue 1: Deleting the addition of Rs. 5,24,912/- made u/s 40(a)(ia) of the I.T. Act
  The assessee deducted TDS on interest paid on unsecured loans but deposited it belatedly before filing the return of income. The AO disallowed the interest amount due to the late deposit. The CIT(A) deleted the addition, and the ITAT upheld this decision, stating that as per the amended provision of Section 43B, no disallowance u/s 40(a)(ia) can be made if TDS is deposited before filing the ROI.
  
  Issue 2: Deleting the addition of Rs. 3,32,14,571/- on account of Benami Account
  The AO added Rs. 3,32,14,571/- as the assessee failed to explain the source of credits in Benami accounts held in the name of M/s. Sarjan Housing Finance Development Ltd. The CIT(A) deleted this addition, following the Tribunal's order for A.Y. 2004-05, which affirmed that the beneficial ownership lay with the assessee. The ITAT upheld the deletion, confirming that the statement of Shri Porwal had limited evidentiary value.
  
  Issue 3: Deleting the addition of Rs. 2,96,583/- on account of interest income from Benami Account
  The AO added Rs. 2,96,583/- as interest income from Benami accounts. The CIT(A) deleted this addition, and the ITAT upheld the deletion, following the Tribunal's decision for A.Y. 2004-05.
  
  Issue 4: Deleting the addition of Rs. 75,000/- on account of unexplained amount deposited in bank
  The AO added Rs. 75,000/- as the assessee could not explain the source of the amount deposited. The CIT(A) deleted this addition after examining the pay-slip, and the ITAT upheld the deletion, noting that the AO failed to make further inquiries.
  
  Issue 5: Restricting the addition from Rs. 1,94,86,619/- to Rs. 13,39,750/- on account of unexplained cash credit u/s 68 of the I.T. Act
  The AO added Rs. 1,94,86,619/- as unexplained cash credits. The CIT(A) reduced this to Rs. 13,39,750/-, finding several creditors genuine based on provided documents and statements. The ITAT upheld the CIT(A)'s decision, agreeing that the identity, genuineness, and creditworthiness of the creditors were established to the extent required by law. The ITAT noted that the assessee is not required to prove the source of the source.
  
  Conclusion:
  Both the appeals of the revenue stand dismissed. The ITAT upheld the CIT(A)'s decisions on all issues, confirming the deletions and reductions made.

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• 2013 (8) TMI 1137
  
  Issues Involved:
  1. Deletion of addition towards consultancy charges.
  2. Set-off of losses from Non-EOUs against profits of EOUs before computing deduction u/s 10B.
  3. Adjustment of interest income earned from Associated Enterprise (AE) on funds advanced to AE.
  
  Summary:
  
  Issue 1: Deletion of Addition towards Consultancy Charges
  The Revenue contested the deletion of Rs. 14,60,477/- made towards consultancy charges. The Assessing Officer disallowed the claim, asserting the expenditure pertained to a joint venture company. The ld. CIT(A) found that the consultancy agreement and invoices were verified, confirming the payment was made by the assessee for legitimate business expenditure and not to a joint venture partner. The Tribunal upheld the ld. CIT(A)'s decision, noting no evidence from the Revenue to dispute the consultancy charges' relation to the assessee's export business.
  
  Issue 2: Set-off of Losses from Non-EOUs against Profits of EOUs before Computing Deduction u/s 10B
  The Revenue challenged the ld. CIT(A)'s decision that losses from Non-EOUs need not be set off against profits of EOUs before computing deduction u/s 10B. The Assessing Officer argued that deduction u/s 10B should be on total income, not individual units' profits. The ld. CIT(A) observed that separate books were maintained for EOU and Non-EOU units, and the transfer cost of materials was wrongly recorded. The Tribunal, referencing the Special Bench decision in Scientific Atlanta India Technology Pvt. Ltd, confirmed that losses from non-eligible units need not be set off against eligible units' profits before computing deduction, dismissing the Revenue's appeal.
  
  Issue 3: Adjustment of Interest Income Earned from AE on Funds Advanced to AE
  The Revenue disputed the deletion of Rs. 39,18,508/- towards adjustment of interest income from AE. The TPO had adjusted the interest by applying the PLR, while the assessee charged interest at LIBOR plus 1%. The ld. CIT(A) held that the assessee's interest rate was in line with international market practices. The Tribunal, agreeing with the ld. CIT(A) and referencing various Tribunal decisions, dismissed the Revenue's appeal, confirming the interest rate charged by the assessee was appropriate for an international transaction.
  
  Conclusion:
  The Tribunal dismissed the Revenue's appeal on all grounds, upholding the ld. CIT(A)'s decisions regarding consultancy charges, set-off of losses for deduction u/s 10B, and adjustment of interest income from AE.

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• 2013 (8) TMI 1136
  
  Issues involved:
  The issues involved in this case are the revision of assessment u/s 263 of the Income Tax Act 1961, regarding the treatment of land as agricultural or non-agricultural for the purpose of long term capital gains tax.
  
  Revision u/s 263 of the Income Tax Act:
  The appellant argued that the Commissioner of Income Tax (CIT) wrongly revised the assessment under section 263 of the Act, claiming that the land in question was agricultural. The appellant cited various case laws to support their argument. On the other hand, the Revenue supported the revision order, stating that the Assessing Officer had incorrectly treated the land as agricultural.
  
  Nature of the Land and Assessment Details:
  The appellant, an individual, along with family members, sold land which was approved for non-agricultural use before the sale deed. The appellant's income for the assessment year included various sources like salary, business income, capital gains, and agricultural income. The Assessing Officer had initially accepted the income returned by the appellant.
  
  Reasoning for Revision by CIT:
  The CIT issued a notice under section 263, stating that the land had been converted for non-agricultural use before the sale, making it liable for capital gains tax. The CIT highlighted various documents and approvals related to the land's conversion and stamp duty implications.
  
  Judicial Analysis and Decision:
  The Tribunal analyzed the facts and arguments presented by both parties. It was noted that the land had indeed been approved for non-agricultural use before the sale deed. The Tribunal emphasized the need for proper inquiry by the Assessing Officer regarding the nature of the land. Citing relevant case law, the Tribunal upheld the CIT's jurisdiction under section 263 for revising the assessment. The Tribunal dismissed the appeal, stating that the CIT had rightly exercised authority under section 263 of the Act.
  
  Conclusion:
  The Tribunal dismissed the appeal, affirming the CIT's revision of the assessment under section 263 of the Income Tax Act. The decision was pronounced on August 13, 2013, in Chennai.

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• 2013 (8) TMI 1135
  
  Issues involved:
  The judgment involves appeals filed by both the Revenue and the Assessee against the common order of the Commissioner of Income-tax(Appeals) at Tiruchirapalli for various assessment years.
  
  Issue 1: Depreciation claim by Revenue
  The Revenue raised the issue that allowing depreciation on a capital asset already claimed as an application of income would result in double deduction. The Revenue relied on judgments from the Kerala High Court and the Income-tax Appellate Tribunal, Cochin Bench. However, the Income-tax Appellate Tribunal, Chennai Bench-A, in the assessee's own case for other assessment years, held that there is no double deduction. The Tribunal followed judgments from the Punjab and Haryana High Court and upheld the Commissioner's order in favor of the assessee. Consequently, the appeals filed by the Revenue were dismissed.
  
  Issue 2: Rejection of grounds by Assessee
  The Assessee contended that the Commissioner of Income-tax(Appeals) erred in rejecting their grounds against the reopening of assessments under section 148 of the Income-tax Act, 1961. Although the Commissioner rejected the contention regarding reopening, the appeals of the Assessee were allowed on the merits of the issue. The Tribunal considered the ground against reopening as academic and found that the appeals of the Assessee were also liable to be dismissed. Ultimately, both the Revenue's and the Assessee's appeals were dismissed.
  
  This judgment highlights the interpretation of depreciation claims and the reopening of assessments under section 148 of the Income-tax Act, 1961, emphasizing the importance of legal precedents and consistency in tax assessments.

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• 2013 (8) TMI 1134
  
  Issues involved: Appeal by Revenue against CIT(Appeals) order regarding provision for wage arrears in assessment u/s 143(3) r.w.s. 147 for AY 2006-07.
  
  Summary:
  
  The appeal was filed by the Revenue against the order of the Commissioner of Income Tax (Appeals)-V, Chennai for the Assessment Year 2006-07. The assessee, a Public sector Transport Undertaking, initially declared a loss of Rs. 1,02,77,76,051 for the year. The assessment was completed u/s. 143(3) of the Income Tax Act, 1961, determining the income as NIL. Subsequently, the case was re-opened u/s. 147, with a notice issued to the assessee on 07-01-2010, primarily due to a provision for wage arrears of Rs. 5.80 Crores made by the assessee. The Assessing Officer disallowed this provision along with belated payments towards Employees Pension Fund in an order dated 20-12-2010.
  
  In response, the assessee appealed before the CIT(Appeals), who noted that the provision for wage arrears was made in accordance with a wage settlement and directed the Assessing Officer to allow it after verification. The Revenue then appealed against this order.
  
  During the proceedings, the Revenue's representative reiterated the grounds of appeal, seeking to set aside the CIT(Appeals) order. On the other hand, the assessee's representative argued that the provision for wage arrears was based on a settlement agreement with trade unions and supported the CIT(Appeals) findings.
  
  After considering the submissions and reviewing the lower authorities' orders, the ITAT Chennai found that the provision for wage arrears was created against an ascertained liability as per the Wage Settlement Agreement. The CIT(Appeals) decision to remit the issue back to the Assessing Officer for verification was upheld, and the Revenue's appeal was dismissed for lacking merit.
  
  The order was pronounced in open court on 7th August 2013 in Chennai.

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• 2013 (8) TMI 1133
  
  Issues involved: Interpretation of U.P. Sheera Niyantran Adhiniyam, 1964 and the imposition of administrative charges on molasses under Section 7-A.
  
  The judgment addresses the petitioner's contention regarding the imposition of administrative charges under the U.P. Sheera Niyantran Adhiniyam, 1964, specifically focusing on the rate increase from Rs. 5 to Rs. 11 per quintal. The petitioner argues against double taxation under different enactments, citing the U.P. Trade Tax Act and VAT Act. The Court refers to a previous case where trade tax on molasses was deemed unlawful, leading to a refund order. The Court directs the State not to collect trade tax on molasses purchases and orders a refund for taxes collected post the specified date. The judgment is pending appeal in the Supreme Court, with an interim stay on refunds and provision for interest if the assessee succeeds. The Court upholds the previous Division Bench judgment and interim Supreme Court order, subject to the final outcome of the pending appeal. The respondents are barred from collecting tax on molasses during the appeal, with a requirement to maintain records for potential future tax liability if the appeal is unsuccessful.

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• 2013 (8) TMI 1132
  
  Issues Involved:
  1. Deduction of modernization expenses on Compact Drafting System as revenue expenditure u/s 37.
  2. Classification of Clean Development Mechanism (CDM) receipts as revenue or capital receipts.
  3. Classification of expenditure on modernization and replacement of machinery as revenue or capital expenditure.
  
  Summary:
  
  Issue 1: Deduction of Modernization Expenses on Compact Drafting System as Revenue Expenditure u/s 37
  The Revenue's appeal contested the Commissioner of Income Tax (Appeals)'s decision allowing the deduction of modernization expenses on Compact Drafting System as revenue expenditure u/s 37. The Tribunal upheld the CIT(A)'s decision, referencing the co-ordinate Bench's ruling in the case of M/s. Prabhu Spinning Mills Pvt. Ltd. for AY 2008-09, which determined that the Compact Spinning System is an attachment to existing machinery and thus qualifies as revenue expenditure. The Tribunal dismissed the Revenue's appeal.
  
  Issue 2: Classification of Clean Development Mechanism (CDM) Receipts as Revenue or Capital Receipts
  The assessee's appeal challenged the CIT(A)'s classification of CDM receipts as revenue receipts. The Tribunal referenced the co-ordinate Bench's decision in the case of Sri Velayudhaswamy Spinning Mills P. Ltd., which held that CDM receipts are capital receipts, not revenue receipts. The Tribunal followed this precedent, ruling in favor of the assessee and setting aside the CIT(A)'s order on this issue.
  
  Issue 3: Classification of Expenditure on Modernization and Replacement of Machinery as Revenue or Capital Expenditure
  The assessee's appeal also contested the CIT(A)'s decision to treat the expenditure on the replacement of autoconer machines as capital expenditure. The Tribunal upheld the CIT(A)'s decision, which was based on the Supreme Court's ruling in CIT Vs. Mangayarkarasi Mills P. Ltd., determining that such expenditure results in an enduring benefit and thus qualifies as capital expenditure. The Tribunal rejected the assessee's grounds on this issue.
  
  Conclusion:
  The appeal of the Revenue (ITA No.606/Mds/2013) was dismissed, and the appeal of the assessee (ITA No.617/Mds/2013) was partly allowed. The Tribunal's decisions were pronounced in the open court on August 30, 2013, in Chennai.

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• 2013 (8) TMI 1131
  
  Issues Involved:
  1. Non-consideration of evidence by the Tribunal.
  2. Characterization of land as agricultural or non-agricultural.
  3. Scope of rectification u/s 254(2) of the Income Tax Act.
  
  Summary:
  
  1. Non-consideration of evidence by the Tribunal:
  The assessee filed a Miscellaneous Petition seeking rectification of the Tribunal's order dated 17.10.2012, claiming a mistake apparent on record due to non-consideration of evidence. The assessee argued that the Tribunal failed to consider the certificate issued by the Village Administrative Officer (VAO) and other relevant evidence while deciding the appeal.
  
  2. Characterization of land as agricultural or non-agricultural:
  The Assessing Officer (AO) concluded that the land in question was not agricultural based on several factors, including the official website of the Government of Tamil Nadu categorizing the property as residential, the layout and road access provided, and the absence of agricultural income from the land since its purchase in 2004. The AO's findings were:
  - The VAO's certificate was deemed insignificant compared to the official categorization.
  - The layout and road access indicated non-agricultural use.
  - The prohibitive cost and lack of agricultural income further supported the non-agricultural classification.
  
  3. Scope of rectification u/s 254(2) of the Income Tax Act:
  The Tribunal examined whether there was a mistake apparent on the record that warranted rectification u/s 254(2). The Tribunal noted that the assessee failed to provide substantial evidence to prove the land was agricultural. The Tribunal emphasized that rectification is permissible only for patent, manifest, and self-evident errors, not for debatable issues or to review its own order. The Tribunal cited various judgments, including the Hon'ble Jurisdictional High Court in Express Newspapers Limited v. DCIT [2010] 320 ITR 12 (Mad), which clarified that rectification cannot be used to reargue the appeal or address debatable points.
  
  Conclusion:
  The Tribunal found no merit in the assessee's Miscellaneous Petition, as the alleged mistake did not qualify as an apparent error on the record. The petition was dismissed, affirming the AO's characterization of the land and the Tribunal's original decision. The order was pronounced on 20th August 2013 at Chennai.

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• 2013 (8) TMI 1130
  
  Issues Involved:
  1. Validity of the conviction u/s 21(c) of the NDPS Act.
  2. Legitimacy of the search and seizure procedures.
  3. Voluntariness and admissibility of the statement u/s 67 of the NDPS Act.
  4. Discrepancies in timings and procedural lapses.
  
  Summary:
  
  1. Validity of the conviction u/s 21(c) of the NDPS Act:
  The Appellant was convicted for an offence punishable u/s 21(c) of the NDPS Act and sentenced to rigorous imprisonment for 10 years and a fine of Rs. 1 lakh, with an additional three months of simple imprisonment in default of payment. The Appellant challenged the conviction, arguing that the secret information received was a farce and that the introduction of the word "heroine" in the notice u/s 50 NDPS Act belied the prosecution's version.
  
  2. Legitimacy of the search and seizure procedures:
  The Appellant contended that the search and seizure were conducted improperly. The prosecution claimed that the Appellant was apprehended based on secret information and taken to the DRI office for a search. However, the defense argued that the Appellant was arrested at the Tourist Lodge and the handbag was planted on him. The prosecution's version was supported by the testimony of PW1, who stated that the search was conducted at the DRI office, and the recovery of 3.955 Kgs of heroine was made from the Appellant's shoulder bag.
  
  3. Voluntariness and admissibility of the statement u/s 67 of the NDPS Act:
  The Appellant argued that his statement u/s 67 NDPS Act was not voluntary and was recorded by the seizing officer himself. The prosecution countered that the statement was voluntary, as evidenced by the Appellant's medical examination showing no injuries and the absence of any immediate retraction when produced before the Court. The Court found the retraction to be highly belated and an afterthought, thus upholding the voluntariness of the statement.
  
  4. Discrepancies in timings and procedural lapses:
  The defense highlighted discrepancies in the timings of the Appellant's arrest and the place of seizure. The prosecution clarified that the entries in the Foreign Guest Register were made after the DRI officers had left and that the recovery was from the shoulder bag, not the personal search, making the notice u/s 50 NDPS Act non-essential. The Court found the discrepancies to be minor and inconsequential, with the prosecution proving beyond reasonable doubt that the case property and samples were properly secured and intact when presented in Court and CFSL.
  
  Conclusion:
  The Court concluded that the prosecution had proved the case beyond reasonable doubt against the Appellant. The appeal was dismissed, and the conviction and sentence were upheld.

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• 2013 (8) TMI 1129
  
  Issues Involved:
  1. Jurisdiction of the Sessions Court to entertain a revision for enhancement of sentence.
  2. Prosecution of Directors and other responsible persons without arraying the Company as an accused.
  3. Applicability of the Supreme Court's judgment in Aneeta Hada vs. Godfather Travels & Tours (P) Limited.
  
  Summary:
  
  1. Jurisdiction of the Sessions Court to entertain a revision for enhancement of sentence:

  When these matters came up for hearing, a doubt arose whether the learned Sessions Judge had jurisdiction to try Crl.R.C.No.34 of 2005, seeking enhancement of sentence. Therefore, a question was referred for decision by a Division Bench: "Whether the Court of Sessions has got power to entertain a revision for enhancement of sentence?" A Division Bench of this Court, by order dated 19.04.2012, answered the question affirmatively, stating, "The Court of Sessions has got power to entertain a revision for enhancement of sentence."

  2. Prosecution of Directors and other responsible persons without arraying the Company as an accused:

  The petitioners argued that as per Section 32 of the Industrial Disputes Act, when a person committing an offence is a Company, prosecution against the Directors and other persons responsible for the Management is not maintainable in the absence of the Company being arrayed as an accused. They relied on the Supreme Court's judgment in Aneeta Hada vs. Godfather Travels & Tours (P) Limited, which held that a Company cannot be indicted without being arrayed as an accused and without affording sufficient opportunity to the Company to defend the charges. The Court agreed with this argument, stating that in the absence of the Company being arrayed as an accused, the prosecution of the petitioners, who are only the Director and then Vice-President, cannot be sustained.

  3. Applicability of the Supreme Court's judgment in Aneeta Hada vs. Godfather Travels & Tours (P) Limited:

  The Court noted that the principles of fair trial guaranteed under Article 21 of the Constitution of India apply to artificial juristic persons as well. It held that for punishing an accused under the Industrial Disputes Act by invoking Section 32, it is necessary that the Company should be arrayed as an accused. The Court emphasized that recording a finding of guilt against the Company without affording it an opportunity to defend would be arbitrary and violative of Article 14 of the Constitution. Therefore, the Court concluded that the judgment in Aneeta Hada's case applies, and the conviction against the petitioners cannot be sustained in the absence of the Company being arrayed as an accused.

  Final Order:

  The Crl.R.C.Nos. 8 and 9 of 2009 are allowed, and the conviction and sentence imposed by the learned II Metropolitan Magistrate in C.C.No.10403 of 1995, dated 18.08.2003, and confirmed in Crl.A.No.289 of 2003, dated 06.02.2008, are set aside. The order of enhancement of sentence of fine imposed by the learned Additional District and Sessions Judge, Fast Track Court No.I, Chennai, in Crl.R.C.No.34 of 2005 is also set aside. The petitioners in Criminal Revision cases as well as the other accused, who have not preferred appeal or revision, are also hereby acquitted. The fine amount, if any, paid by the revision petitioners and the other accused shall be refunded to them. Consequently, the Criminal Original Petition in Crl.O.P.No. 8025 of 2008 is dismissed.

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• 2013 (8) TMI 1128
  
  Issues Involved:
  The appeal concerns the deletion of disallowance of depreciation on Goodwill amounting to Rs. 67,66,083 for the assessment year 2008-09.
  
  Summary:
  The Appellate Tribunal ITAT Ahmedabad heard the appeal filed by the Revenue against the order of the CIT(A)-XI, Ahmedabad for the assessment year 2008-09. The assessee, a company engaged in computer education, software development, sales, and exports, had declared a loss of Rs. 80,89,561 in its return of income. The assessment was framed u/s 143(3) of the Act, resulting in a total loss of Rs. 12,67,420. The main issue revolved around the claim of depreciation on Goodwill. The assessee contended that the issue had been decided in its favor for the assessment year 2007-08 by the ITAT, Ahmedabad "A" Bench, citing a relevant Supreme Court decision. The Revenue, however, relied on the AO's order disallowing the depreciation on Goodwill.
  
  The Tribunal noted that the assessee had claimed depreciation on Goodwill, which the AO disallowed as Goodwill was not specified as an intangible asset for depreciation u/s 32. The Tribunal referred to a similar case where depreciation on software was allowed as it was considered an intangible asset. Relying on precedent, the Tribunal upheld the CIT(A)'s decision to allow depreciation on Goodwill amounting to Rs. 90,21,444. The Tribunal dismissed the Revenue's appeal, stating that there was no reason to interfere with the CIT(A)'s order.
  
  In conclusion, the Tribunal upheld the CIT(A)'s decision to allow depreciation on Goodwill, dismissing the Revenue's appeal.

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• 2013 (8) TMI 1127
  
  Issues involved: Appeals against penalty orders u/s 271 (1) (c) and u/s 271B for the same A.Y. 2008-09.
  
  Penalty u/s 271 (1) (c): The appeal was made by the assessee challenging the penalty order. The assessee's representative cited a previous tribunal decision where penalty was deleted under similar circumstances. The tribunal noted that in the cited case, penalty was deleted as the facts were similar, involving an undisclosed bank account and additions made by the assessing officer. The tribunal found the facts in the present case to be similar and deleted the penalty accordingly.
  
  Penalty u/s 271B: The appeal was filed against the penalty order u/s 271B. The assessee's representative referred to a judgment by the Hon'ble Allahabad High Court where penalty was deleted for non-maintenance of books of account as required by law. The tribunal observed that in the cited case, the penalty was deleted based on the reasoning that the offence of not maintaining books of account as per the law was complete, and thus no further penalty u/s 44AB could be imposed. Since the facts in the present case were identical, the tribunal followed the judgment and deleted the penalty u/s 271B.
  
  In conclusion, both appeals by the assessee were allowed, and the penalties u/s 271 (1) (c) and u/s 271B were deleted based on the similarity of facts with previous judicial decisions.

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• 2013 (8) TMI 1126
  

  Insuring attendance of the appellant before the Court - Issue of Bailable Warrant & summons before issuance of Non-bailable Warrant - Power of the Court – HELD THAT - The power under Section 319 of the Cr.P.C being discretionary must be exercised judiciously with extreme care and caution. The court should properly balance both personal liberty and societal interest before issuing warrants. There cannot be any straight-jacket formula for issuance of warrants but as a general rule, unless an accused is likely to tamper or destroy the evidence or is likely to evade the process of law, issuance of non-bailable warrants should be avoided.

  Article 21 of our Constitution proclaims that no one shall be deprived of his liberty except in accordance with the procedure prescribed by law. The issuance of non-bailable warrant involves interference with personal liberty. Orders passed by the Trial Court and confirmed by the High Court modified, and direct that summons be issued against the appellant for his appearance instead of non- bailable warrants which were ordered to be issued against him.

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• 2013 (8) TMI 1125
  
  Issues involved: The judgment involves appeals related to assessment years 2005-2006 and 2008-2009 for M/s. Jayadarsini Housing Pvt. Ltd. regarding the applicability of Sec.2(22)(e) of the I.T. Act on payments made to certain individuals and entities.
  
  Details of the Judgment:
  
  1. Assessing Officer's Findings: The Assessing Officer held that payments made by Jayadarsini Housing Pvt. Ltd. to specific individuals and entities represented income within the meaning of Sec.2(22)(e) of the I.T. Act and charged tax u/s 201(1) and interest u/s 201(1A) for failure to deduct tax at source.
  
  2. Confirmation by CIT (Appeals): The learned Commissioner of Income-Tax (Appeals) confirmed the Assessing Officer's actions regarding deemed dividend under Sec.2(22)(e) for certain individuals but found that one entity was not a shareholder and thus the provision did not apply.
  
  3. Assessee's Appeals (ITA.No. 1360 to 1363/Hyd/2011): The Hon'ble ITAT dismissed the department's appeals, stating that trade advances do not fall under Sec.2(22)(e) and in the absence of distributable profit, the case does not come under the purview of the section.
  
  4. Revenue's Appeals (ITA.No. 1344 to 1347/Hyd/2011): The Revenue appealed the CIT (Appeals) decision, arguing that the recipients not being shareholders did not exempt the payments from Sec.2(22)(e). However, the ITAT upheld the CIT (Appeals) decision based on precedents and the nature of the transactions.
  
  5. Legal Precedents: The ITAT considered legal precedents such as the Mumbai Special Bench decision and the Delhi High Court ruling to support the interpretation that Sec.2(22)(e) applies only to shareholders receiving loans or advances.
  
  6. Final Decision: The appeals filed by the department were dismissed, and those filed by the assessee were allowed based on the findings that the payments were part of business transactions and not deemed dividends under Sec.2(22)(e).
  
  In conclusion, the ITAT judgment clarified the application of Sec.2(22)(e) of the I.T. Act to payments made by Jayadarsini Housing Pvt. Ltd., ultimately ruling in favor of the assessee based on the nature of the transactions and legal interpretations.

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• 2013 (8) TMI 1124
  

  Accepting loans in cash - Section 269SS - Repayment of loans through Journal Entries - Penalty u/s 271D & 271E - Concept of Reasonability - Assessee had taken 3 loans exceeding the limits specified in section 269SS - HELD THAT:- "Reasonable cause" differs from case to case. A.O. need to reconsider the matter to check whether "reasonable cause" was there for such act of assessee.

  Since there is no material on record to indicate the reasonable cause in respect of these loan transactions - In the converse situation, the Assessing Officer has every right to decide the fate of the assessee as per law.

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• 2013 (8) TMI 1123
  
  Issues involved: Determination of the validity of additions made by the Assessing Officer u/s 40A(3) of the Income Tax Act for payments exceeding specified limits to a State Government Company in cash.
  
  Summary:
  
  Issue 1: Validity of additions made u/s 40A(3) of the Act
  The appeals by the revenue for A.Ys. 2008-09 and 2009-10 were directed against the common order of ld. CIT(A), Central, Jaipur dated 12/01/2013. The main issue was whether the additions of Rs. 16,04,482/- in A.Y. 2008-09 and Rs. 15,21,517/- in A.Y. 2009-10 made by the A.O. u/s 40A(3) of the Act for payments exceeding Rs. 20,000/- to a State Government Company in cash were justified. The A.O. did not consider the assessee-company as a Government entity and did not apply Rule 6DD(b) of the Income-tax Rules, 1962. However, the ld. CIT(A) reversed this decision, stating that the payments made to the Government company were covered under the said rule.
  
  Issue 2: Application of Rule 6DD(b) of the Income-tax Rules, 1962
  After considering the arguments, it was found that there was no dispute regarding the identity of the payee and the genuineness of the payments. Referring to the case law CIT Vs. Kalyan Prasad [2011] 51 DTR 191 [Raj], where Rule 6DD(b) was applied when payments were collected on behalf of the State Government, it was concluded that the payments made to the Government company in this case did not warrant disallowances u/s 40A(3) of the Act. The Tribunal upheld the impugned order and dismissed the appeals of the revenue.
  
  Conclusion:
  The Tribunal pronounced the order on 22nd August, 2013, dismissing the appeals of the revenue, thereby affirming that the payments made to the Government company did not contravene the provisions of section 40A(3) of the Income Tax Act.

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• 2013 (8) TMI 1122
  
  Issues Involved:
  1. Demolition of unauthorized RCC staircase.
  2. Demolition of unauthorized chajja projected over CMC footpath.
  
  Summary:
  
  Issue 1: Demolition of Unauthorized RCC Staircase
  The case involves the unauthorized construction of an RCC staircase from the ground floor to the roof of the first floor, with pillars and a connected wall erected on the rooftop of the adjoining premises. Initially, a proceeding u/s 400(1) of the Calcutta Municipal Corporation Act, 1980 was started, but no demolition order was passed for the staircase by the Special Officer, Building. The complainant challenged this, leading to a court order on January 30, 2004, directing the Special Officer to reconsider the complaint. Upon reconsideration, the Special Officer ordered the demolition of the unauthorized staircase and roof within 15 days, failing which the KMC would demolish it at the cost and risk of the person responsible (P.R.).
  
  The P.R. filed a writ petition to set aside this order, arguing that the Tribunal did not apply its mind and mechanically followed the court's earlier order. The Tribunal and the Special Officer, Building, were accused of not properly considering the points raised by the P.R. However, the Tribunal affirmed the demolition order, noting that the construction was unauthorized, extended onto the adjoining premises, and affected the complainant's property rights. The review application was also dismissed, with the Tribunal stating that there was no error or defect warranting a review.
  
  The High Court found no illegality in the Tribunal's findings and emphasized the importance of structural stability. The construction was deemed unauthorized and damaging to the complainant's property. Consequently, the writ petition by the P.R. (W.P.23601(W) of 2007) was dismissed, and the writ petition by the complainant (W.P.24843(W) of 2007) was allowed. The Municipal authorities were directed to remove the staircase if not demolished by the P.R. within a fortnight.
  
  Issue 2: Demolition of Unauthorized Chajja
  The unauthorized construction of a chajja projected over the CMC footpath was also addressed. Initially, the Special Officer, Building, ordered its demolition, which was carried out by the P.R. The Tribunal and the High Court upheld this order, noting that the chajja was an unauthorized construction that infringed on public property.
  
  Conclusion:
  The High Court upheld the orders for the demolition of both the unauthorized RCC staircase and the chajja projected over the CMC footpath. The P.R.'s writ petition was dismissed, and the complainant's writ petition was allowed, with the Municipal authorities directed to enforce the demolition if not carried out by the P.R. within the stipulated time.

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• 2013 (8) TMI 1121
  
  Issues involved: Winding up petition filed by petitioner against respondent company for non-payment of dues under Facility Agreement, disputed debt, issuance of composite advertisement in connected company petitions.
  
  Winding up Petition:
  The petitioner sought winding up of the respondent company, M/s. Amar Remedies Limited, claiming dues amounting to Rs. 12,80,04,500 under the Facility Agreement dated 25 January 2010, which the respondent failed to pay. The petitioner highlighted that cheques issued by the respondent were dishonoured.
  
  Disputed Debt:
  The respondent company contended in its reply that the statutory notice was not sent. However, the petitioner's counsel argued that the notice was sent to both the registered address of the company and the addresses mentioned in the correspondence. It was noted that the reply provided by the respondent did not offer substantial reasons for disputing the debt. Additionally, company petition no.517 of 2012 and other related matters had been admitted against the respondent company, and an advertisement had been directed to be issued.
  
  Composite Advertisement in Connected Company Petitions:
  In the connected company petitions, it was directed that a composite advertisement be issued. The advertisement in the present petition was also to be included as part of the composite advertisement directed to be issued in company petition no.517 of 2012 and other connected matters. The petitioner was instructed to take necessary steps in this regard.
  
  The company petition was admitted and set to be heard along with other connected matters on 13 September 2013. The directive for a composite advertisement in the connected company petitions aimed to streamline the process and ensure all relevant information was appropriately disseminated.

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• 2013 (8) TMI 1120
  
  Issues involved: Appeal against order of CIT(Appeals) for AY 2009-10 on dis-allowance u/s. 40(a)(i) for commissions paid to foreign concerns and re-computation of deduction u/s. 10B by excluding freight expenditure.
  
  Dis-allowance u/s. 40(a)(i): The assessee, a company engaged in manufacturing and export, claimed deduction u/s 10A for AY 2009-10. During assessment, dis-allowance u/s 40(a)(i) was made by AO for not deducting tax at source on commission paid to foreign agents. The CIT(Appeals) allowed the appeal of the assessee against this dis-allowance. The Revenue challenged this before ITAT Chennai.
  
  The ITAT Chennai noted that the foreign agents had no permanent establishment in India and the services were rendered outside India. Citing a similar case, the Tribunal held that no tax deduction at source was required on payments made to non-residents for services rendered abroad. The Tribunal dismissed the Revenue's appeal on this ground, as it was similar to a previously adjudicated case.
  
  Re-computation of deduction u/s 10B: The second ground of appeal related to the computation of deduction u/s 10A. The Special Bench of the Tribunal in the case of M/s. Saksoft Ltd held that certain expenses, including freight, should be excluded from both export turnover and total turnover while calculating deduction u/s 10B. The Revenue contested this citing an appeal filed u/s 260A, but failed to provide any contrary judgment. The Tribunal dismissed the Revenue's appeal on this ground as well, stating that the order had not been stayed by any Higher Court.
  
  In conclusion, the ITAT Chennai dismissed the appeal of the Revenue as it lacked merit. The order was pronounced on August 14, 2013, in Chennai.

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• 2013 (8) TMI 1119
  
  Issues Involved:
  1. Determination of whether the land in question was agricultural land or a capital asset.
  2. Treatment of agricultural income as income from other sources.
  
  Issue 1: Determination of Nature of Land
  The assessee contested the revenue authorities' decision that the land transferred was not agricultural but a capital asset within the meaning of section 214 of the Act. The facts revealed that the land was situated in Tondapally village, Shamshabad Mandal, included in the Hyderabad Air Port Development Authority (HADA) and later under Hyderabad Metropolitan Development Authority (HMDA). The Assessing Officer concluded that the land was not agricultural due to its location within HADA/HMDA, its sale for non-agricultural purposes, and its high sale consideration. The CIT(A) upheld this view, emphasizing the need for actual agricultural use at the time of sale, referencing the Supreme Court's decision in Sarifa Bibi Mohammad Ibrahim & Others.
  
  The Tribunal, however, noted that the land was recorded as agricultural in revenue records, was in a bio-conservation zone, and had no development activity. It referenced several judicial precedents, including the Supreme Court's decision in Sarifa Bibi Mohammad Ibrahim & Others and the ITAT Hyderabad Bench's decision in Smt. T. Urmila vs. ITO, which stated that mere inclusion in a development authority's jurisdiction does not change the land's agricultural character unless converted under relevant laws. The Tribunal concluded that the land retained its agricultural character as it was used for agriculture, recorded as such in revenue records, and no conversion had occurred. Consequently, it was not a capital asset under section 2(14) of the Act, and no capital gains tax was applicable.
  
  Issue 2: Treatment of Agricultural Income
  The CIT(A) treated the agricultural income as income from other sources, arguing that the land was not agricultural. The Tribunal, however, reversed this decision, noting that the assessee had consistently shown agricultural income in previous returns. Given the Tribunal's finding that the land was indeed agricultural, it held that the income of Rs. 30,000 shown by the assessee should be treated as agricultural income.
  
  Conclusion
  The Tribunal allowed the appeal, setting aside the CIT(A)'s order and directing the deletion of the capital gains addition, affirming that the land was agricultural and the income derived from it was agricultural income.

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