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Showing 81 to 100 of 1599 Records
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2013 (10) TMI 1521
Issues Involved:
1. Legal propriety of the Tribunal's judgment.
2. Alleged irregularity in hiring Civil Hired Transport (CHT).
3. Violation of Rule 180 of the Army Rules, 1954.
4. Non-supply of documents.
5. Inclusion of biased members in the Court of Inquiry (CoI).
Summary:
1. Legal Propriety of the Tribunal's Judgment:
The Supreme Court examined the legal propriety of the Tribunal's judgment dated 12-12-2012, which set aside the decision of the additional CoI and directed a fresh CoI with a different Presiding Officer and other independent members.
2. Alleged Irregularity in Hiring Civil Hired Transport:
A complaint was made on 5-8-2009 against Respondent 1, a Colonel in the Army, alleging irregularities in hiring CHT for supplying ordnance stores. The General Officer Commanding-in-Chief, Pune initiated an action by attaching Respondent 1 to Headquarters Sub-Area and convening a Board of Officers, which led to the CoI.
3. Violation of Rule 180 of the Army Rules, 1954:
Respondent 1 challenged the CoI proceedings before the Tribunal, contending deprivation of the right to cross-examine witnesses as per Rule 180 and non-supply of documents annexed after the CoI proceedings. The Tribunal initially found no merit in the grievance regarding cross-examination but acknowledged the non-supply of documents as a violation of Rule 180.
4. Non-Supply of Documents:
The Tribunal found that certain documents annexed to the CoI report were not made available to Respondent 1, violating Rule 180. Consequently, the Tribunal directed an additional CoI limited to these documents, allowing Respondent 1 to cross-examine witnesses related to those documents.
5. Inclusion of Biased Members in the Court of Inquiry (CoI):
Respondent 1 objected to the inclusion of Brig. N.S Ahamed as Presiding Officer and two Technical Members, Lt. Col. Sandeep Sinha and Maj. Sanjeev Narula, in the additional CoI, alleging bias. The Tribunal held that the inclusion of these members, who had prepared and arranged the documents, violated the principles of natural justice and Rule 180. The Tribunal concluded that their involvement raised a reasonable apprehension of bias, thus vitiating the additional CoI proceedings.
Conclusion:
The Supreme Court upheld the Tribunal's decision to quash the additional CoI and all consequential actions, directing a fresh additional CoI with different, unbiased members. The appeal was dismissed, emphasizing the necessity of impartiality and adherence to procedural safeguards in CoI proceedings.
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2013 (10) TMI 1520
Issues Involved:
1. Connection of appellant with Mehta group entities.
2. Allegations of circular, reversal, synchronized, and structured trades.
3. Violation of PFUTP Regulations.
4. Quantum of penalty under Section 15HA of SEBI Act.
5. Analysis of findings by Adjudicating Officer (AO).
Summary:
1. Connection of appellant with Mehta group entities:
The appellant was alleged to be connected with the Mehta group entities through Sunil Mehta, who opened the appellant's account with Triveni. The appellant denied any connection with other entities in the Mehta group except for Sunil Mehta, who was a friend of his son.
2. Allegations of circular, reversal, synchronized, and structured trades:
The appellant was accused of engaging in circular/reversal synchronized trades with the Mehta group, which created artificial volume and influenced the price of ASCL's scrip. The investigation revealed that the appellant's trades were synchronized and structured, contributing to 2.9% of the market volume.
3. Violation of PFUTP Regulations:
The appellant was found to have violated Regulations 3(a), (b), (c) & (d) and 4(1), 4(2)(a), (b), (e) & (g) of PFUTP Regulations. The trades executed by the appellant were not isolated incidents but part of a repeated pattern of manipulation over a period of time, leading to artificial price rise and volume in the scrip of ASCL.
4. Quantum of penalty under Section 15HA of SEBI Act:
The AO imposed a penalty of Rs. 5,00,000 u/s 15HA of SEBI Act, 1992, considering the repetitive nature of the default and the impact on market integrity. The Hon'ble Supreme Court in SEBI v. Shri Ram Mutual Fund emphasized that penalty is attracted as soon as the contravention is established, irrespective of the intention.
5. Analysis of findings by Adjudicating Officer (AO):
The Tribunal noted that the AO adopted a generic approach in dealing with all entities of the Mehta group, which was not appropriate. The appellant, a 73-year-old retired individual, claimed ignorance of the trades executed in his account and did not report unauthorized trading by Sunil Mehta. The Tribunal concluded that there was no substantial evidence of the appellant's direct involvement in manipulating the scrip of ASCL. The appeal was allowed, and the impugned order was set aside.
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2013 (10) TMI 1519
Issues involved: Appeal against CIT(A) order for assessment year 2004-05 regarding addition of unexplained opening balance of capital by AO.
Summary:
The appeal was filed by the Revenue against the order of the CIT(A)-VII, Hyderabad, for the assessment year 2004-05. The Assessee, an individual deriving income from other sources, was part of M/s Sunder Steel Ltd Group of Cases where search & seizure proceedings took place. The AO assessed the Assessee's income at a higher amount by adding an unexplained opening balance of capital. Assessee contended before the CIT(A) that the AO wrongly added the opening capital without considering the information provided. The CIT(A) observed that the AO's basis for the addition was incorrect as the amount in question was actually a closing balance, not an opening one. Referring to section 68 of the IT Act, the CIT(A) directed the AO to delete the addition.
The Revenue, aggrieved by the CIT(A)'s order, raised multiple grounds of appeal. The learned DR argued that the AO rightly made the addition due to lack of details from Assessee, while the counsel for Assessee relied on the CIT(A)'s order. After hearing both parties and examining the records, the ITAT Hyderabad noted that the AO's addition was based on a wrong premise as the amount was a closing balance, not an opening one. The ITAT upheld the CIT(A)'s decision to delete the addition, stating that the AO had made the addition without proper basis. It was also highlighted that the AO had accepted similar balances in earlier and later years, making the addition in this particular year unjustified. Therefore, the ITAT confirmed the CIT(A)'s order and dismissed the Revenue's appeal.
In conclusion, the ITAT Hyderabad upheld the CIT(A)'s decision to delete the addition of the unexplained opening balance of capital, dismissing the Revenue's appeal for the assessment year 2004-05.
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2013 (10) TMI 1518
Levy of Surcharge and Cess on interest income - Assessee resident of Singapore claiming benefit under DTAA - Scope of adjustment u/s 143(1) is limited - Upper ceiling for the rate of tax of interest of Article 11 of DTAA as well as Surcharge and education cess can be decided while accepting the return u/s 143(1)? - HELD THAT - Tax has been defined in Article-2(2)(b) as per which income tax included surcharge. Therefore, tax referred to in Article 11(2) @ 12.5% also includes surcharge. Interest income may have been assessed as business income, there being specific Article to deal with interest income i.e. Article-11, taxation of interest will be governed by the said Article-11. Thus , it is held that tax payable @ 12.5% under Article 11(2) of FTAA is inclusive of surcharge and education cess. Decision in favor assessee.
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2013 (10) TMI 1517
Issues involved: Appeal by Revenue challenging decision of Income Tax Appellate Tribunal on various grounds.
Ground (A): The Assessee incurred expenses for plot/site development on leased land, which was held to be revenue expenditure as no enduring benefit was derived. Tribunal justified in this conclusion as the expenditure was to render the land usable for business activities without resulting in any enduring benefit.
Ground (B): CIT(A) deleted an addition but directed Assessing Officer to treat it as income for the relevant Assessment Year. Tribunal held that CIT(A) had no jurisdiction to make such a direction for a year not under appeal, in line with legal principles.
Ground (C): Tribunal found that the creditors in question were not bogus but actual contractors based on the return of income filed by the Assessee and acceptance of the same by the Department. Section 68 not applicable as payments were made to genuine contractors, leading to dismissal of appeal.
In conclusion, the High Court dismissed the appeal by the Revenue based on the findings and reasoning provided by the Tribunal for each ground of appeal.
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2013 (10) TMI 1516
Issues Involved:
1. Deletion of addition on account of unexplained cash of Rs. 1,00,000/-.
2. Deletion of addition on account of unaccounted investment u/s. 69B (Land at Naroda) of Rs. 29,00,000/-.
3. Deletion of addition on account of unaccounted investment u/s. 69B (Land at Chandkheda) of Rs. 30,50,000/-.
Summary:
1. Unexplained Cash of Rs. 1,00,000/-:
The A.O. observed that during a search and seizure operation, cash of Rs. 1,18,250/- was found in the assessee's residence, out of which Rs. 1,00,000/- was seized. The assessee claimed this cash belonged to disclosed sources of income. The A.O. was not satisfied, citing a disclosure of Rs. 92.26 lacs as unaccounted income by the group, including Rs. 12.5 lacs of undisclosed cash. The CIT(A) deleted the addition, noting that the total cash found was less than the cash as per the books of different entities of the group. The Tribunal upheld the CIT(A)'s decision, dismissing the Revenue's appeal on this ground.
2. Unaccounted Investment u/s. 69B (Land at Naroda) of Rs. 29,00,000/-:
The A.O. found a loose paper during the search indicating a cash payment of Rs. 29 lacs for land at Naroda. The assessee admitted the cash payment but claimed it was already reflected in the accounts. The A.O. was not convinced and added Rs. 29 lacs as unaccounted investment. The CIT(A) deleted the addition, stating there was no evidence of any further cash payment beyond what was already disclosed. The Tribunal upheld the CIT(A)'s decision, noting the lack of conclusive evidence and necessary inquiry by the A.O., thus dismissing the Revenue's appeal on this ground.
3. Unaccounted Investment u/s. 69B (Land at Chandkheda) of Rs. 30,50,000/-:
The A.O. found documents indicating a land purchase agreement and cash payments totaling Rs. 30.50 lacs. The assessee claimed the agreement was canceled and the payment was disclosed in the partnership firm's income. The A.O. added Rs. 30.50 lacs as unaccounted income, doubting the disclosure. The CIT(A) deleted the addition, noting the payment was part of the firm's disclosed income and the deduction u/s. 80-IB was already disallowed in the firm's case. The Tribunal upheld the CIT(A)'s decision, clarifying that any action should be taken for A.Y. 06-07, not A.Y. 07-08, thus dismissing the Revenue's appeal on this ground.
Conclusion:
The Tribunal dismissed the Revenue's appeal on all grounds, upholding the CIT(A)'s deletions of the additions made by the A.O.
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2013 (10) TMI 1515
Issues involved: Confirmation of demand of duty, imposition of penalty, confirmation of interest amount, limitation period for interest demand.
Confirmation of demand of duty and imposition of penalty: Show cause notices were issued to the appellants for the period April, 1998 to September, 1999 proposing confirmation of demand of duty on the ground of use of brand name of another person. The lower authorities confirmed the demand of duty and imposed a penalty, but did not confirm any interest against the appellant in the said order. The appellant challenged these orders before higher authorities, including the Hon'ble Supreme Court, without success.
Confirmation of interest amount and limitation period: Recovery notices for confirmation of interest amount on the confirmed demands were issued in 2006 for the period of 1998-99. The Commissioner (Appeals) held that since the demand was confirmed against the appellant, interest had to be confirmed as well. However, the quantum of interest to be paid was modified. The main question in the present appeal was whether the interest demand raised in 2006 for demands from 1998-99 would be barred by limitation.
Legal Precedents: The Tribunal noted various decisions of the Hon'ble High Courts regarding the period of limitation for interest demands. The Hon'ble High Court of Punjab & Haryana and the Hon'ble High Court of Delhi had differing views on this issue. The Tribunal found that the issue was squarely covered in favor of the appellants by the recent judgment of the Hon'ble Delhi High Court, which held that the period of limitation would apply to the demand of interest. As the interest demand was made in 2006 for the period of 1998-99, the Tribunal found no justification for confirming the interest amount and set aside the impugned order, allowing the appeal with consequent relief.
Disposition of the Appeal: Despite a suggestion to transfer the matter to a Single Member Bench due to only the interest issue being involved and the quantum being less than Rs. 50 lakhs, the Tribunal decided to take up the appeal itself as the issue had been decided by the Hon'ble High Court and did not require elaborate arguments. The Division Bench proceeded to decide the appeal and disposed of it accordingly.
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2013 (10) TMI 1514
Issues involved: Interpretation of provisions u/s 80IB(10) of the Income Tax Act, 1961 regarding the calculation of minimum area for claiming deduction and inclusion of road acquisition area in the plot area.
Summary:
The appeal filed by the Revenue challenged the order of the CIT(A)-V, Pune for Assessment Year 2009-10. The issue revolved around the calculation of the minimum area for claiming deduction u/s 80IB(10) and the inclusion of road acquisition area in the plot area.
The Revenue contended that the road acquisition area should not be considered as part of the plot area for calculating the minimum 1 acre required for deduction u/s 80IB(10). The Assessing Officer disallowed the deduction based on the exclusion of road reservation area, leading to the plot size falling below the required threshold.
In appeal, the CIT(A) allowed the claim of the assessee, emphasizing that the area of the plot should include the road acquisition area as per the registered development agreement and sanctioned plan. The Tribunal, in line with its decision for the preceding assessment year, upheld the CIT(A)'s order, stating that the road acquisition area should not be excluded from the plot area calculation for claiming the deduction u/s 80IB(10).
The Tribunal found no infirmity in the CIT(A)'s order, as it followed the precedent set in the earlier assessment year and no contrary material was presented. Consequently, the appeal filed by the Revenue was dismissed, affirming the allowance of deduction for the housing project "Prem Aangan."
In conclusion, the Tribunal upheld the CIT(A)'s decision, emphasizing the inclusion of road acquisition area in the plot size calculation for claiming deduction u/s 80IB(10) and dismissed the Revenue's appeal accordingly.
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2013 (10) TMI 1513
Issues involved: Appeal against orders of ld CIT(A) u/s 153A(b) of the Income tax Act, 1961 for assessment years 2002-03 to 2006-07.
Summary:
1. The appeals were filed by the assessee against separate orders of ld CIT(A) for assessment years 2002-03 to 2006-07 u/s 153A(b) of the Income tax Act, 1961.
2. Common grounds were taken by the assessee in all appeals. The grounds included challenges related to the assessment order service, violation of natural justice principles, addition of undisclosed income, unexplained payments, and investments.
3. The short facts of the case involved a search and seizure action conducted at the assessee's premises. The Assessing Officer issued a notice under section 153A of the Income tax Act, 1961, after a significant delay following the search. The AO's actions were challenged by the assessee regarding the issuance of notices and lack of reasonable opportunity to produce evidence.
4. The ld CIT(A) dismissed the appeal of the assessee, upholding the actions of the AO. However, the appeals were decided ex parte as the assessee did not appear for the hearing.
5. The Tribunal found that the AO and ld CIT(A) did not follow principles of natural justice in passing the orders. Citing the importance of affording a reasonable opportunity of being heard, the Tribunal reversed the orders of ld CIT(A) and directed the AO to decide the grounds afresh after giving the assessee a fair opportunity.
6. Consequently, all issues raised in the appeals were restored to the file of the AO for fresh assessment. The AO was instructed to conduct denovo assessment as per the law.
7. The appeals filed by the assessee were allowed for statistical purposes. The decision was pronounced in open court on 10th October 2013.
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2013 (10) TMI 1512
Issues Involved:1. Justification of penalty u/s 271FA of the Income Tax Act, 1961. 2. Consideration of reasonable cause for delay in filing Annual Information Return (AIR). 3. Quantum of penalty levied and its computation. Summary:Issue 1: Justification of Penalty u/s 271FAAll appeals concern the levy of penalty u/s 271FA of the Income Tax Act, 1961, for failure to file Annual Information Return (AIR) within the prescribed time. The Sub Registrars were required to file AIRs for transactions of immovable property valued at Rs. 30 lakhs or more by 31st August following the financial year. The DIT (CIB) noted delays in filing these returns and issued show cause notices. The assessees argued ignorance of the law and lack of a Tax Deduction Account Number (TAN) as reasons for the delay. The DIT (CIB) rejected these explanations, emphasizing that ignorance of the law is not an excuse and that government bodies should be more diligent. The CIT(A) upheld the penalties, stating that the legal requirement to file AIRs is mandatory and the assessees' habitual delays indicated mala fide intentions. Issue 2: Consideration of Reasonable Cause for DelayThe assessees contended that the provisions were newly introduced and not within their knowledge, and that they had filed the information manually before obtaining a TAN. The Tribunal acknowledged that the lack of awareness of newly introduced provisions could be considered a reasonable cause for the initial delay. However, once the assessees were made aware through notices or other means, the plea of ignorance could not be sustained. The Tribunal directed that no penalty should be levied for the period up to the date of the first notice, considering it a reasonable cause for the delay. For subsequent delays, the assessees were held liable for penalties. Issue 3: Quantum of Penalty Levied and Its ComputationThe Tribunal accepted the assessees' plea that manual filing of AIRs should be considered compliance for the initial years when the provisions were newly introduced. The DIT (CIB) had already accepted this in some cases, reducing the penalty for the period between manual filing and uploading on the NSDL system. The Tribunal directed the DIT (CIB) to recompute the penalty, excluding the period of reasonable cause and any overlapping periods of default. The assessees were given the opportunity to provide complete information to determine the exact period of default and the quantum of penalty. Conclusion:The Tribunal partly allowed the appeals, directing the DIT (CIB) to recompute the penalties in line with the directions provided, considering the reasonable cause for initial delays and excluding overlapping periods of default.
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2013 (10) TMI 1511
Issues involved: Penalty levied u/s. 271C for multiple assessment years due to failure to deduct TDS on payment made to State Bank of India as MICR charges.
Summary:
The appeals were filed by the assessee against the penalty levied u/s. 271C for various assessment years based on the non-deduction of TDS on payments to State Bank of India as MICR charges. The AO imposed the penalty citing non-compliance with u/s. 194J of the IT Act, considering the payment as "fees for technical charges." The assessee argued before the CIT(A) that there was a reasonable cause for the failure to deduct TDS, referring to Section 273B of the IT Act. However, the CIT(A) upheld the penalty, stating that the provisions of the Act were not followed. The issue in contention was whether the assessee acted on a bona fide belief. The assessee contended that they were unaware of the relevant decision during the assessment years in question and had not faced any repercussions for non-deduction in the past. The ITAT held that the term "reasonable cause" should be interpreted in light of ordinary prudence, considering that taxpayers may not be aware of all legal developments. Therefore, the ITAT concluded that the assessee, being unaware of the legal position at the time, had a reasonable cause for non-deduction of TDS. Consequently, the penalty was deleted for all the years under appeal, and the assessee's appeals were allowed.
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2013 (10) TMI 1510
Issues involved:
1. Maintainability of the reference.
2. Determination of territorial jurisdiction of the two Benches of Allahabad High Court.
3. Interpretation of the expression "cases arising in such areas in Oudh" under Clause 14 of the Amalgamation Order, 1948.
Summary:
1. Maintainability of the reference:
The reference to the Full Bench was challenged by Sri Anurag Khanna on grounds that the reference order was bad in law. He argued that Hon'ble Arvind Kumar Tripathi, J. had already affirmed the opinion of Hon'ble R.D. Khare, J., making further reference unnecessary. He cited the Supreme Court's ruling in Central Board of Dawoodi Bohra Community v. State of Maharashtra, 2005 (2) SCC 673, emphasizing that a Bench of lesser quorum cannot disagree with a larger quorum. However, the Full Bench found that the reference was maintainable, noting that the earlier Division Bench judgment in Baldeo Ram and another v. Deputy Commissioner, Gonda and another, AIR 1959 (All) 460 (DB), which took a contrary view, had escaped notice. Thus, the preliminary objection was rejected.
2. Determination of territorial jurisdiction of the two Benches of Allahabad High Court:
The Full Bench examined the historical context and legal framework governing the territorial jurisdiction of the Allahabad High Court's Principal Bench and the Lucknow Bench. It emphasized that the jurisdiction must be decided based on the provisions of Clause 14 of the Amalgamation Order, 1948, and relevant Supreme Court judgments, particularly Nasiruddin v. State Transport Appellate Tribunal, (1975) 2 SCC 671. The Full Bench concluded that the jurisdiction should be determined by the place where the cause of action arises, not merely the location of the Court passing the impugned order. It held that the interpretation by the Division Benches in Dr. Balram Dutt Sharma and Sanjay Somani, which focused on the location of the Court, was incorrect.
3. Interpretation of the expression "cases arising in such areas in Oudh" under Clause 14 of the Amalgamation Order, 1948:
The Full Bench reiterated that the expression "cases arising in such areas in Oudh" should be interpreted based on the cause of action. It affirmed that a criminal case arises where the offence is committed or as otherwise provided in the Cr.P.C. The Full Bench rejected the view that the location of the Special Judge's Court determines the jurisdiction, emphasizing that the territorial jurisdiction of the High Court's Benches cannot be altered by notifications issued under the Prevention of Corruption Act or Cr.P.C.
Conclusion:
The Full Bench concluded that the Division Benches in Dr. Balram Dutt Sharma and Sanjay Somani did not lay down the correct law. The matters were remitted to the learned Single Judge for decision on merits. The territorial jurisdiction of the two Benches must be decided based on the cause of action as interpreted by the Supreme Court in Nasiruddin's case.
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2013 (10) TMI 1509
Issues Involved:1. Addition of Rs. 4.99 crores received by the Assessee Company from Mrs. N. Sunitha. 2. Determination of whether the amount should be treated as share application money or income from other sources. Summary:Issue 1: Addition of Rs. 4.99 crores received by the Assessee Company from Mrs. N. SunithaThe Assessee filed an appeal against the order of CIT(A) dated 25.1.2012 for the A.Y. 2007-08, contesting the addition of Rs. 4.99 crores received from Mrs. N. Sunitha. The Assessee claimed this amount as share application money, while the AO treated it as income from other sources. The AO noted that the cheque for Rs. 4.99 crores was credited to the accounts of M/s. Primeslots Properties Pvt. Ltd. on 29.5.2006 and was paid out of Mrs. N. Sunitha's account. The Assessee failed to provide documentary evidence supporting the nature of the transaction. The AO concluded that the amount was undisclosed income from other sources and taxed it accordingly. Issue 2: Determination of whether the amount should be treated as share application money or income from other sourcesThe CIT(A) upheld the AO's decision, stating that the receipt of Rs. 4.99 crores could not be treated as share application money, as evidenced by the petition filed by Mrs. N. Sunitha before the Hon'ble High Court of Mumbai. The CIT(A) observed that the amount was advanced for purposes other than share allotment, leading to litigation resolved by consent, making the amount taxable as income from other sources. The Assessee argued that the amount was received as share application money, duly recorded in the books of accounts, and supported by statutory compliance under the Companies Act. The Assessee cited various legal precedents to support the claim that forfeited share application money credited to the capital reserve account is a capital receipt not chargeable to tax. The Assessee also highlighted that the amount was refunded in part and that Mrs. N. Sunitha was allotted shares as per the consent terms approved by the High Court. The Tribunal considered the rival submissions and noted that the revenue authorities did not deny the receipt of the amount by cheque. The Tribunal found no evidence suggesting that the amount was received for rendering services. Citing the decision of the Hon'ble Supreme Court in Parimisetti Seetharamamma vs. CIT, the Tribunal held that the burden of proving the receipt as income lies with the Department. Since no evidence supported the revenue's claim, the Tribunal set aside the order of CIT(A) and deleted the addition of Rs. 4.99 crores. Conclusion:The appeal filed by the Assessee was allowed, and the addition of Rs. 4.99 crores was deleted. The Tribunal pronounced the order in the open court on 25/10/2013.
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2013 (10) TMI 1508
Issues Involved:
1. Jurisdiction of the Civil Court at Mehsana.
2. Entitlement to interest from the date of filing the suit at Mehsana.
3. Applicability of Order VII Rule 10 of the Code of Civil Procedure.
4. Application of Section 14 of the Limitation Act.
5. Executing Court's authority to go behind the decree.
Summary:
1. Jurisdiction of the Civil Court at Mehsana:
The High Court of Gujarat held that the Civil Court at Mehsana did not have territorial jurisdiction to entertain the suits filed by the Respondent. Consequently, the judgment and decrees passed by the Mehsana court were set aside, and the plaints were ordered to be returned to the Respondent for presentation before the appropriate court having jurisdiction.
2. Entitlement to Interest from the Date of Filing the Suit at Mehsana:
The Respondent claimed interest for the period from 1986 to 1999, during which the suit was pending before the Mehsana court. The High Court allowed this claim, holding that the Respondent was entitled to interest from the date of institution of the suit at Mehsana. However, the Supreme Court held that once the plaint was presented before the Civil Court at Surat, it was a fresh suit and could not be considered a continuation of the suit instituted at Mehsana. Therefore, the Respondent could not claim interest for the period when the suit was pending before the Mehsana court.
3. Applicability of Order VII Rule 10 of the Code of Civil Procedure:
The Supreme Court clarified that the return of the plaints by the Mehsana court was in accordance with Order VII Rule 10 of the Code of Civil Procedure, which mandates the return of a plaint if the court finds it has no jurisdiction. The High Court's order to return the plaints was not a transfer of the suit but a return for presentation before the competent court.
4. Application of Section 14 of the Limitation Act:
The Supreme Court reiterated that under Section 14 of the Limitation Act, a plaintiff is entitled to exclude the time during which he prosecuted the suit before a court having no jurisdiction. However, this does not mean that the suit continues from the date of its original filing. Instead, the suit is considered fresh upon its presentation before the competent court.
5. Executing Court's Authority to Go Behind the Decree:
The Supreme Court emphasized that the Executing Court cannot go behind the decree. In this case, the Executing Court correctly observed that the Respondent was entitled to interest only from the date of filing the suit at Surat, not from the date of filing at Mehsana. The Supreme Court upheld this view, stating that the Respondent could not take advantage of its own mistake of filing the suit in a court without jurisdiction.
Conclusion:
The Supreme Court allowed the appeals, setting aside the High Court's judgment and decree. The judgments and orders of the Trial/Executing Court and the Appellate Court were restored, and it was held that the Respondent was not entitled to interest for the period when the suit was pending before the Mehsana court.
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2013 (10) TMI 1507
Issues Involved:
1. Whether the charge of mortgage can be entered in the revenue record in respect of a mortgage effected by deposit of title-deeds without its registration and payment of registration fee and stamp duty.
2. Whether the properties mortgaged by deposit of title-deeds are situated in the towns specified u/s 58(f) of the Transfer of Property Act.
Summary:
Issue 1: Registration and Payment of Fees for Mortgage by Deposit of Title-Deeds
The Petitioners challenged the High Court's order directing entry of charge in the revenue records based on a mortgage created by deposit of title-deeds. The Respondents argued that the instrument of deposit of title-deeds is compulsorily registrable u/s 17(1)(c) of the Registration Act, 1908, and requires payment of registration fee and stamp duty. The High Court negated this, stating that an equitable mortgage is created by the deposit of title-deeds and not through any written instrument. The Supreme Court upheld this view, emphasizing that no registered instrument is required u/s 59 of the Transfer of Property Act for a mortgage by deposit of title-deeds. The Court referred to precedents, including Rachpal v. Bhagwandas and United Bank of India v. Lekharam Sonaram and Co., to support this interpretation. The Court concluded that the charge of mortgage can be entered into revenue records without registration and payment of fees, provided no additional terms and conditions are incorporated in a memorandum.
Issue 2: Location of Properties for Mortgage by Deposit of Title-Deeds
In a separate appeal, the Appellants contended that the properties mortgaged by deposit of title-deeds were not situated in towns specified u/s 58(f) of the Transfer of Property Act. They referred to a notification specifying certain towns for this purpose. The Supreme Court noted that this aspect was not considered by the High Court and remitted the matter back for fresh consideration in light of the specified towns.
Conclusion:
The Supreme Court dismissed the appeal regarding the necessity of registration and payment of fees for a mortgage by deposit of title-deeds, affirming the High Court's judgment. However, it allowed the appeal concerning the location of the properties and remitted the matter back to the High Court for fresh consideration.
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2013 (10) TMI 1506
Issues involved: Appeal against levy of penalty u/s. 271(1)(c) of the Act for inaccurate particulars of income for A.Y. 2002-03.
Summary:
The Appellate Tribunal ITAT Mumbai heard an appeal against the order of the CIT(A)-2, Mumbai, regarding the levy of a penalty u/s. 271(1)(c) of the Act. The case involved the assessee declaring a total loss in the return of income, but later showing the sale of bonus shares of Hotel Rugby Ltd. The AO believed the cost of acquisition of bonus shares should be zero, leading to the entire sale proceeds being taxed as capital gains. The penalty proceedings were initiated for filing inaccurate particulars of income, resulting in a penalty of &8377; 2,48,705/-.
Upon review, the Tribunal found that the revised computation of income had been accepted during assessment proceedings, and the assessee had substantial brought forward long term capital losses. It was noted that the assessee's mistake in taking the cost of bonus shares as zero while computing capital gains could have been inadvertent, as there was no benefit to the assessee in claiming a loss instead of showing capital gains. The Tribunal concluded that the mistake was bona fide, with no loss to the revenue, and directed the AO to delete the penalty.
The Tribunal considered the peculiar facts of the case and the absence of revenue loss in deciding to allow the appeal and delete the penalty. The decision was made based on the specific circumstances of the case, rendering the discussion of judicial decisions unnecessary.
In conclusion, the appeal by the assessee was allowed, and the penalty of &8377; 2,48,705/- u/s. 271(1)(c) of the Act was directed to be deleted.
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2013 (10) TMI 1505
Harmonious construction of section 43B and section 40A(7)(b) of the Act - Deduction of contribution to gratuity fund - deduction on the basis of payment / deposit in cash - approved gratuity fund or not - HELD THAT:- Kerala High Court has held that, section 40A(7), clause (b) sub-clause (i) thereof is a special provision to claim for deduction based on a provision made for payment towards an approved gratuity fund. Referring to various decisions of Supreme Court stated that there is no clear inconsistency between the two provisions. Section 40A(7) is in negative terms and section 43B is in positive terms, the effect of both provisions is that to claim deduction in respect of payment to a gratuity fund there must be actual payment and that deduction cannot be allowed on the basis of any provision. The only exception to the above rule is with regard to the provision for payment to an approved gratuity fund. It cannot be interpreted that the later provision in section 43B by introducing the non-obstante clause would abrogate the special provision with regard to the provision made for payment to an approved gratuity fund contained in section 40A(7)(b)(i). This is all the more so since no patent conflict or inconsistency can be spelt out. Both the provisions can co-exist. A harmonious construction of the aforesaid two provisions would clearly indicate that the Legislature never intended to take away the benefit conferred under clause (b) of section 40A(7) by the provisions of section 43B(b) of the Act.
The A.O. is directed to allow the assessee's claim of provision for gratuity after verifying whether the provision made by the assessee is to an approved gratuity fund or not. In case the said gratuity is approved then the provision is to be allowed. In the event the said gratuity fund is not an approved one, then as per the proviso’s to section 43B of the Act, deduction is to be allowed to the extent of actual payments towards gratuity up to the due date for filing the return of income u/s.139(1)
Decision in the case COMMISSIONER OF INCOME-TAX VERSUS COMMON WEALTH TRUST (P.) LTD [2004 (4) TMI 51 - KERALA HIGH COURT] followed.
Deduction u/s 80IA - calculating the deduction - the carry forward of losses of other eligible units to be considered or not - HELD THAT:- For the purpose of computation of gross total income, the losses of other units are to be taken into account. However for the purposes of calculating the deduction of an eligible unit / undertaking u/s.80-IA of the Act, the loss sustained in another unit / undertaking cannot be taken into account and it is only the profit that shall be taken into account as if it was the only source of income of that unit.
Following the decision in the case of Synco Industries Ltd [2008 (3) TMI 13 - SUPREME COURT], held that, the assessee has to compute the claim of deduction of each eligible unit / undertaking, as if it is the only source of income from such eligible undertaking and without any setting off of unadjusted brought forward losses of other eligible undertakings. We find from the record that the computation of the eligible deduction u/s.80-IA of the Act by the assessee is in accordance with the procedure laid down and is therefore entitled to claim and be allowed deduction u/s.80-IA.
Applicability of provisions of section 115JB of the Act - HELD THAT:- the provisions of section 115JB of the Act are not applicable to the assessee which is an electric company in the business of generation of power. In this view of the matter, the additional grounds of appeal raised by the assessee on the non-applicability of the provisions of section 115JB of the Act is allowed.
Decision in the case SYNDICATE BANK VERSUS THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 1, UDUPI [2015 (4) TMI 727 - ITAT BANGALORE] followed.
In the result, the assessee's appeal is partly allowed.
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2013 (10) TMI 1504
Issues Involved:
1. Jurisdiction of CCI on pre-notification acts.
2. Evidence of collusive bidding and cartel formation.
3. Validity of considering tenders from other organizations.
4. Legality of investigating 2011 tender.
5. Penalty imposition and calculation.
Summary:
1. Jurisdiction of CCI on Pre-notification Acts:
The appellants argued that the act of submitting identical bids on 8.5.2009 could not be scrutinized by CCI as Section 3 was notified only on 20.5.2009. However, the Tribunal held that the process of bidding continued beyond 8.5.2009, including negotiations on 1.6.2009 and 17.6.2009, thus falling within the jurisdiction of CCI. The Tribunal emphasized that the term "manipulating the process for bidding" u/s 3(3) covers all stages from tender notice to contract award.
2. Evidence of Collusive Bidding and Cartel Formation:
The Tribunal found substantial evidence of collusive bidding, noting consistent identical pricing by the appellants in tenders from 2007 to 2011. The identical pricing pattern and the boycott of the 2011 tender indicated a pre-concerted agreement among the appellants. The Tribunal rejected the appellants' defense that identical pricing was coincidental and not indicative of cartel behavior.
3. Validity of Considering Tenders from Other Organizations:
The Tribunal upheld the DG's consideration of tenders from other organizations, stating that the consistent pattern of identical pricing across various tenders supported the finding of a cartel. The Tribunal dismissed the argument that the DG exceeded his brief by investigating tenders beyond the specific tender mentioned in the initial information.
4. Legality of Investigating 2011 Tender:
The Tribunal rejected the appellants' argument that the DG had no jurisdiction to investigate the 2011 tender, as the CCI's order u/s 26(1) was broad enough to cover ongoing anti-competitive behavior. The Tribunal found that the appellants' boycott of the 2011 tender was part of a continued anti-competitive agreement.
5. Penalty Imposition and Calculation:
The Tribunal criticized the CCI for not providing reasons for imposing a penalty of 9% of the average three years' turnover. It emphasized the need for proportionality and relevant turnover in penalty calculation, especially for multi-product companies like United Phosphorous Ltd. and Excel Crop Care Ltd. The Tribunal adjusted the penalties based on the relevant turnover of ALP tablets, reducing the penalty for Sandhya Organic Chemicals Pvt. Ltd. to Rs. 15.70 lakhs, while setting penalties for United Phosphorous Ltd. and Excel Crop Care Ltd. at Rs. 6.94 crores and Rs. 2.91 crores respectively.
Conclusion:
The Tribunal confirmed the finding of breach of the Competition Act by the appellants but modified the penalties based on relevant turnover considerations. The appeals were dismissed with adjusted penalties.
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2013 (10) TMI 1503
Issues Involved:
1. Rectification of the common order passed by the Tribunal.
2. Taxation of undisclosed income and profits from certain projects.
3. Allocation of profits between individuals and the company.
4. Jurisdiction and authority of the Tribunal u/s 254(2).
Summary:
Issue 1: Rectification of the Common Order
The Revenue filed a Miscellaneous Application seeking rectification of the Tribunal's common order dated 29.07.2011. The Tribunal had disposed of appeals filed by Shri Mansukhlal N Patel and M/s. Ambica Realities Pvt. Ltd. The Revenue sought to rectify the order to bring the remaining amount of profit from certain projects to tax in the hands of M/s. Ambica Realities Pvt. Ltd.
Issue 2: Taxation of Undisclosed Income and Profits
Search and seizure operations u/s 132 were conducted in the Rajani Builders group, including M/s. Ambica Realities Pvt. Ltd. and Shri Mansukhlal N Patel. Incriminating materials indicated profits of Rs. 2,16,56,000/-. Block assessments were completed u/s 158BC, assessing undisclosed income in the hands of both entities. The Tribunal's order dated 29.07.2011 confirmed the addition of Rs. 13,53,500/- in the hands of Shri Mansukhlal N Patel, representing his 6.25% share in the profits, but deleted the main addition of Rs. 2,16,56,000/- in both cases.
Issue 3: Allocation of Profits
The Tribunal noted that the allocation of 6.25% of profits to Shri Mansukhlal N Patel necessitated corresponding availability of profits in the hands of M/s. Ambica Realities Pvt. Ltd. The Tribunal rectified its order to tax the entire profit of Rs. 2,16,56,000/- on a substantive basis in the hands of M/s. Ambica Realities Pvt. Ltd., ensuring consistency with the High Court's order confirming the 6.25% share in the hands of Shri Mansukhlal N Patel.
Issue 4: Jurisdiction and Authority u/s 254(2)
The Tribunal emphasized its authority u/s 254(2) to rectify mistakes apparent from the record to prevent miscarriage of justice and avoid prejudice. The Tribunal found that the deletion of the entire profit in both cases was inconsistent and self-contradictory. Therefore, it amended its order to tax the profit substantively in the hands of M/s. Ambica Realities Pvt. Ltd.
Conclusion:
The Miscellaneous Application No.11/Rjt/2012 filed by the Revenue in the case of M/s. Ambica Realities Pvt. Ltd. was allowed to the extent of taxing the entire profit of Rs. 2,16,56,000/- substantively. The Miscellaneous Application No.06/Rjt/2012 in the case of Shri Mansukhlal N Patel was dismissed as the Tribunal's view had been confirmed by the High Court, merging the order and rendering it non-rectifiable u/s 254(2).
Order Pronounced on 04.10.2013
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2013 (10) TMI 1502
Issues involved: Appeal against order of CIT(A) regarding Fringe Benefit Tax for A.Y. 2006-07 & 2007-08.
Summary:
1. The appellant filed returns for Fringe Benefit Tax at Rs. Nil, but the auditor reported values of Fringe Benefit. The AO, considering relevant case law, held the appellant liable for Fringe Benefit Tax for both assessment years.
2. The CIT(A) confirmed the AO's decision, noting that all expenses were incurred on employees, and the FBT was deposited into the government treasury. The appellant's argument was dismissed based on these findings.
3. The appellant admitted a similar decision against them in another case. The ITAT, following a previous decision, upheld the CIT(A)'s order, dismissing the appeals.
Judgment: The ITAT dismissed the appeals, following precedent and confirming the CIT(A)'s decision based on the appellant's actions and the legal provisions.
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