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2007 (12) TMI 482
Extradition Act, 1962 - formal request for extradition did not satisfy the requirements of Article 9 of the Extradition Treaty as well as Section 7 of the Act - filed an application for supply of deficient documents and requested supply of copies thereof to lead his defence - declined by the learned Magistrate - legality and validity of the Order - recommended the extradition of the appellant to United States of America - Drug trafficking and money laundering - Sale and supply of MDMA - controlled substance and other offensive substances - Appellant is an Indian citizen - holds an Indian Passport - also a resident of United States of America - order of extradition on the basis of the material which would constitute 'evidence' and as some of the documents - HELD THAT:- In a proceeding for extradition no witness is examined for establishing an allegation made in the requisition of the foreign State. The meaning of the word "evidence" has to be considered keeping in view the tenor of the Act. No formal trial is to be held. Only a report is required to be made. The Act for the aforementioned purposes only confers jurisdiction and powers on the Magistrate which he could have exercised for the purpose of making an order of commitment. Although not very relevant, we may observe that in the Code of Criminal Procedure, 1973, the powers of the committing Magistrate has greatly been reduced. He is now required to look into the entire case through a very narrow hole. Even the power of discharge in the Magistrate at that stage has been taken away.
If evidence stricto sensu is required to be taken in an enquiry forming the basis of a prima facie opinion of the Court, the same would lead to a patent absurdity. Whereas in a trial the court for the purpose of appreciation of evidence may have to shift the burden from stage to stage, such a procedure is not required to be adopted in an enquiry. Even under the Code of Criminal Procedure existence of strong suspicion against the accused may be enough to take cognizance of an offence which would not meet the standard to hold him guilty at the trial.
In a case of this nature the second part of Section 10 of the Act would apply which does not contemplate production of any oral evidence by the Central Government. No fact needs to be proved by evidence. What is necessary is to arrive at a prima facie case finding that a case has been made out for extradition from the depositions, statements, copies and other informations which are to be gathered from the official certification of facts and judicial documents that would include the indictment by the Grand Jury.
Section 10 of the Act provides as to what would be received in evidence. The marginal note although may not be relevant for rendition of decisions in all types of cases but where the main provision is sought to be interpreted differently, reference to marginal note would be permissible in law. [See Deewan Singh and Ors. vs. Rajendra Pd. Ardevi and Ors.[2007 (1) TMI 551 - SUPREME COURT].
The use of the terminology 'evidence' in Section 7 of the Act must be read in the context of Section 10 and not d'hors the same. It is trite that construction of a statute should be done in a manner which would give effect to all its provisions.
Section 10 of the Act clearly provides that any exhibit or deposition which may be received in evidence need not be taken in the presence of the person against whom they are used or otherwise. It also contemplates the copies of such exhibits and depositions and official certificates of facts and judicial documents stating facts would, if duly authenticated, be received as evidence.
We, therefore, are of the opinion that an information need not be a documentary evidence or an oral evidence as is understood under the Indian Evidence Act.
Thus, we are of the opinion that no case has been made out for interference with the impugned judgment. The appeal is dismissed.
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2007 (12) TMI 481
Penalty levied u/s 271(1)(c) - concealed or furnished an inaccurate particulars of income - excess deduction claimed u/s 80-M - HELD THAT:- We are unable to find any error or infirmity in the order passed by the Tribunal which has concluded that there was no justification for the AO to have levied the penalty particularly when the AO has not found that the particulars furnished by the Assessee were false and where the AO had not also unearthed any material fact or particulars which the Assessee did not disclose.
No substantial question of law arises in this appeal. Dismissed.
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2007 (12) TMI 480
Determination of the “Market Value” of an immovable property based on “Proposed Land Use”- Enhancement on compensation for acquisition of the land - four sale deeds related to sale transactions - Prior to the issuance of notification u/s 4 of the Land Acquisition Act ('the Act') - land for construction of a cooperative sugar mill - land was situate as one compact unit in four villages and belonged to 17 families - deduction by way of allowance from the price exhibited by the exemplars of small plots which have been filed by the parties - HELD THAT:- The land has not been acquired for a Housing Colony or Government Office or an Institution. The land has been acquired for setting up a sugar factory. The factory would produce goods worth many crores in a year. A sugar factory apart from producing sugar also produces many by-product in the same process. One of the by-products is molasses, which is produced in huge quantity. Earlier, it had no utility and its disposal used to be a big problem. But now molasses is used for production of alcohol and ethanol which yield lot of revenue. Another by-product begasse is now used for generation of power and press mud is utilized in manure. Therefore, the profit from a sugar factory is substantial. Moreover, it is not confined to one year but will accrue every year so long as the factory runs.
A housing board does not run on business lines. Once plots are carved out after acquisition of land and are sold to public, there is no scope for earning any money in future. An industry established on acquired land, if run efficiently, earns money or makes profit every year. The return from the land acquired for the purpose of Housing Colony, or Offices, or Institution cannot even remotely be compared with the land which has been acquired for the purpose of setting up a factory or industry.
After all the factory cannot be set up without land and if such land is giving substantial return, there is no justification for making any deduction from the price exhibited by the exemplars even if they are of small plots. It is possible that a part of the acquired land might be used for construction of residential colony for the staff working in the factory. Nevertheless where the remaining part of the acquired land is contributing to production of goods yielding good profit, it would not be proper to make a deduction in the price of land shown by the exemplars of small plots as the reasons for doing so assigned in various decisions of this Court are not applicable in the case under consideration.
Therefore, we are of the opinion that a deduction of 10% from the market value of the land, which has been arrived at by the High Court would meet the ends of justice. Therefore, the market value of the acquired land for the purpose of payment of compensation to the land owners has to be assessed at ₹ 1,08,000/- per acre.
Thus, the appeals are partly allowed. The claimant- appellants will be entitled to compensation at the rate of ₹ 1,08,000/- per acre. Besides the above amount, they will also be entitled to the statutory sum in accordance with Section 23(1-A) and solatium at the rate of 30% on the market value of the land in accordance with Section 23(2) of the Act. They will also be entitled to interest as provided in Section 28 of the Act. The appellants will be entitled to their costs.
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2007 (12) TMI 479
Issues Involved:
1. Whether the ITAT was right in law in upholding the order of the CIT (Appeals), directing the Assessing Officer to allow full credit of T.D.S to the assessee, in contravention of the provisions of section 199 of the Income Tax Act.
2. Whether the findings recorded by ITAT in allowing full credit of TDS to assessee are perverse and sustainable in view of statutory provisions of Section 199 of Income Tax Act, 1961.
Summary:
Issue 1: Credit of T.D.S to the Assessee
The appeals were filed u/s 260-A of the Income Tax Act, 1961, challenging the composite order dated 25.01.2007 by the ITAT, which upheld the CIT (Appeals) decision directing the Assessing Officer to allow full credit of T.D.S to the assessee. The CIT (A) relied on CBDT circular No. 2 of 2002, which stated that the entire T.D.S benefit was to be given to the holder of the bond at the time of maturity. The CIT (A) concluded that the assessee-secondary purchaser was entitled to the T.D.S credit as the T.D.S certificate was issued in her name at the time of bond maturity. The Tribunal upheld this view, interpreting that the circular resolved issues arising from Section 199 for deep discount bonds, and T.D.S should be credited to the bondholder at maturity.
Issue 2: Findings of ITAT and Statutory Provisions of Section 199
The Tribunal interpreted Section 199 and the CBDT circular correctly, stating that any deduction made and paid to the Central Government should be treated as payment on behalf of the 'owner of the security' or 'unit holder'. The Tribunal found that the assessee-secondary purchaser, being the bondholder at maturity, was rightly entitled to the T.D.S credit. The Tribunal's interpretation was that the original purchaser did not claim any T.D.S benefit, and the subsequent income was declared by the assessee-secondary purchaser, who claimed the T.D.S credit. The Tribunal's decision was based on the amended Section 199 effective from 01.04.1997 and the guidelines issued in the CBDT circular.
Conclusion:
The High Court dismissed the appeals, agreeing with the Tribunal's interpretation of Section 199 and the CBDT circular. The Court held that the assessee-secondary purchaser was entitled to the T.D.S credit as the bondholder at maturity. The judgments cited by the revenue were not applicable as they pertained to earlier assessment years before the amendment and the issuance of the CBDT circular. The substantial questions of law raised by the revenue were answered against the revenue, and the appeals were dismissed.
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2007 (12) TMI 478
Issues Involved:
The judgment addresses the following Issues:
1. Whether profit on sale of land carried to capital reserve can be added to book profit u/s 115J?
2. Whether non-recurring profits not included in book profits can be added by the assessing officer to re-work the book profit u/s 115J?
Issue 1: Profit on Sale of Land and Capital Reserve:
The assessee, a company not substantially interested by the public, transferred the profit from the sale of land to 'capital reserve,' which the assessing officer added to the book profits under section 115J of the Income Tax Act. The Commissioner of Income Tax (Appeals) upheld this addition, but the Income Tax Appellate Tribunal allowed the appeal. The High Court, citing the decision in Apollo Tyres Ltd. v. Commissioner of Income Tax, held that the assessing officer cannot go behind the net profit shown in the profit and loss account except as provided in the explanation to section 115J. Therefore, the Tribunal was correct in reversing the assessing officer's order.
Issue 2: Non-Recurring Profits and Book Profit Re-calculation:
The assessing officer sought to add non-recurring profits, not part of the book profits, to re-calculate the book profit u/s 115J. The High Court, following the decision in Apollo Tyres case, reiterated that the assessing officer's power is limited to examining whether the books of account are properly maintained and making adjustments as per the explanation to section 115J. The Court held that the assessing officer cannot exceed this jurisdiction, as clarified in the Apollo Tyres case, and therefore upheld the Tribunal's decision to allow the appeal.
The High Court, in light of the legal principles established in the Apollo Tyres case, dismissed the revenue's appeal, affirming the Tribunal's decision.
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2007 (12) TMI 477
Validity of reopening of assessment u/s 147 - escaped assessment - Income from undisclosed sources - bogus transactions of purchase and sale of shares.
Validity of reopening of assessment u/s 147 - escaped assessment - HELD THAT:- Assessee found to have received cheques issued from the said bank account. Thus, the information was not vague or too general but specific and concerning the assessee herself. We, therefore, hold that the AO had valid reason to believe that income chargeable to tax has escaped assessment. It may be noted that under similar circumstances, Hon'ble Delhi High Court in the case of CIT vs. Vipin Batra [2007 (5) TMI 51 - HIGH COURT,NEW DELHI] has upheld the validity of reassessment and directed the Tribunal to deal with the case on merits. When the original assessment was completed under s. 143(1)(a), the AO has no occasion to form an opinion in such original assessment which can be said to have changed while reopening the assessment. This view is fortified by the decision of Hon'ble Supreme Court in the case of Asstt. CIT vs. Rajesh Jhaveri Stock Brokers (P) Ltd.[2007 (5) TMI 197 - SUPREME COURT]. We, therefore, uphold the action of AO in assuming jurisdiction for framing reassessment under s. 147. Accordingly, the cross-objection raised by assessee is to be dismissed.
Bogus transactions - We find that after the assessee having furnished proof for purchase, sale, registration of shares in her name duly supported by market quotations etc., the AO ignored the same on the basis of statement of the share broker, namely, Shri Satish Goel through whom the assessee has sold the shares. The purchase of shares were in the earlier years and the same transaction is not found to be bogus. Thus, the assessee has proved the purchase of shares at least. The transfer of shares were held to be bogus on the basis of statement of chartered accountant/company law consultant of Globe Commercial Ltd. Similarly, the statement of Shri Satish Goel as recorded by Dy. Director of IT, Gurgaon, though made available to the assessee but the objection raised thereagainst has not been considered. The statement of a person may give rise to conduct further enquiry but that cannot be held as a sacrosanct particularly when a person challenges the contention of such statement in view of specific proof.
In view of the above principles laid down in the case of SMC Share Brokers Ltd. [2006 (8) TMI 110 - DELHI HIGH COURT] and Kishinchand Chellaram [1980 (9) TMI 3 - SUPREME COURT], it is seen that unless the principles of natural justice are followed by allowing assessee to cross-examine a person whose statement is said to be relied upon, such statement cannot be admitted in evidence. If such statement is discarded, there is no material with the AO to hold that the transaction of sale of shares is bogus. Since the assessee has specifically requested for an opportunity to cross-examine, which was denied, we find it difficult to admit the evidence in the form of statement of Shri Satish Goel to hold the transaction as bogus. Consequently, the transaction is to be treated as genuine and the claim of the assessee is allowable. We, therefore, sustain the deletion of addition by learned CIT(A).
We, therefore, do not find any justification to sustain the addition as made by the AO - In the result, the appeal and cross-objection are dismissed.
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2007 (12) TMI 476
Interpretation of provisions of s. 124 - Assumption of Jurisdiction with the AO - vests with the Director General or Chief CIT or CIT respectively - No objection with regard to jurisdiction of the AO raised - transferring the case of the appellant-assessee - HELD THAT:- A perusal of sub-s. (3)(b) of s. 124 of the Act shows that the jurisdiction of an AO cannot be called in question by an assessee after the expiry of one month from the date on which he was served with a notice under sub-s. (1) of s. 142 of the Act or after completion of assessment, which was to be earlier. It is further evident that sub-s. (4) of s. 124 has been made subject to the provisions of sub-s. (3) in case an assessee has questioned the jurisdiction of an AO. It is only in those jurisdiction that the AO is to refer the matter for determination to the Director General or the Chief CIT or the CIT as per the provisions of s. 124(2) of the Act. It is, thus, evident that before (sic-after) the expiry of the period of one month from the date of service of notice under sub-s. (1) of s. 142 of the Act, no right to question the jurisdiction of an AO would survive.
In the present case, notice under s. 142(1) of the Act was issued to the appellant-assessee on 25th Feb., 1993 and the return was to be filed on or before 15th March, 1993, which, in fact, has been filed on 1st March, 1993. No objection to the jurisdiction till 6th Sept., 1994 was raised when the appellant-assessee requested for transfer of the case to Delhi. Therefore, it is not possible to conclude that the AO was under obligation to refer the question of jurisdiction to the Director General or Chief CIT as per the provisions of s. 124(2) r/w s. 124(4) of the Act, as is contended by learned counsel for the appellant-assessee.
We are further of the view that it would not make any difference even if at one stage accounts for AY 1992-93 were transferred to New Delhi, which were returned to the AO, Sirsa, because there was no effective transfer of record. Moreover, the substantial business in the financial year 1992-93 was transacted at Sirsa. The argument that the record at one stage was transferred and, therefore, the assessment order passed by the AO at Sirsa is bad cannot be accepted and we have no hesitation to reject such an argument.
Thus, this appeal fails. The questions of law are answered against the appellant-assessee and in favour of the Revenue.
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2007 (12) TMI 475
The Gujarat High Court dismissed the appeal regarding the deletion of addition of Rs. 6,38,365 on account of bogus purchases from M/s. Shreedhar Trading Co. and M/s. Shakti Enterprises. The Tribunal and CIT (Appeals) found no merit in the appeal, confirming the deletion of the addition.
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2007 (12) TMI 474
Issues involved: Appeal against Tribunal's order imposing penalty u/s 271(1)(c) of the IT Act for assessment year 2000-01 based on admission of income from service charges under house property, challenge of Tribunal's order on merits for earlier years, and whether penalty was rightly dropped by CIT(A) and confirmed by Tribunal.
Summary:
The appellant, a partnership firm engaged in civil engineering contracts and hotel business, admitted income from service charges under house property for the assessment year 2000-01. The penalty u/s 271(1)(c) was imposed by the AO, which was challenged by the assessee before the CIT(A). The CIT(A) dropped the penalty proceedings citing the assessee's bona fide belief that the service charges should not be taxed as income from house property, as evidenced by the reference application filed before the High Court. The Tribunal upheld the CIT(A)'s decision, leading to the present appeal by the Revenue.
The Revenue contended that the assessee failed to inform the authorities about the disposal of the reference application against the Tribunal's decision. However, it was found that the assessee had provided all relevant particulars regarding the service charges and had cooperated with the Department post the Tribunal and High Court orders. The CIT(A) concluded that there was no deliberate attempt to conceal income, and the reason offered by the assessee was acceptable.
Considering the factual findings and the decisions of the statutory authorities and the Tribunal, the High Court dismissed the tax case appeal, referencing the Supreme Court judgment in T. Ashok Pai vs. CIT (2007) 210 CTR (SC) 259: (2007) 292 ITR 11(SC). No costs were awarded in this matter.
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2007 (12) TMI 473
Issues involved: Confirmation of assessed income and interest under section 234B of the IT Act, 1961.
Confirmation of assessed income:
The appeal was filed against the order of the CIT(A) for the assessment year 2003-04. The primary issue was the confirmation of the assessed income at Rs. 4,99,260, opposed to the 'nil' income declared in the return. The assessee, a construction company, had entered into a development agreement with another company for a property in Mumbai. The agreement involved two phases - rehabilitation and sale. The AO added Rs. 4,99,264 to the income of the assessee for interest accrued as per the development agreement, which the CIT(A) confirmed. The assessee contended that due to legal restrictions and non-availability of Floor Space Index (FSI), the project could not be completed, resulting in no interest income materializing. The Tribunal agreed with the assessee, stating that no interest income accrued due to the project's unviability, and directed the deletion of the addition.
Interest under section 234B of the IT Act, 1961:
The issue of interest under section 234B was consequential to the first issue. Since the Tribunal decided in favor of the assessee regarding the confirmed income, the interest under section 234B was also decided in favor of the assessee. Consequently, the appeal of the assessee was allowed.
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2007 (12) TMI 472
Reopening of assessment u/s 147 - Non Service of the notice u/s 148 of the act and 142(1) of the Act - HELD:- There are categorical findings of fact recorded by the Tribunal that the revenue has not been able to produce any material to show that any notices u/s 148 was served upon the assessee in respect of the assessment years under consideration. Tribunal has noticed that the matter was time and again sent back to the AO by the CIT (A) and no authority could record positive and categoric finding that notice u/s 148 of the Act was served upon the assessee. It appears that there is no proof with regard to the service on the assessee u/s 148 of the Act.
The Tribunal has further noticed that proceedings in respect of assessment year under consideration were dropped on 31-9-2002 with specific findings by the AO that notice u/s 148 could not be served. These are pure findings of fact which would not give rise to any question of law much less a substantive question of law.
It is well-settled that issuance of a notice u/s 148 of the Act is a condition precedent for framing assessment order u/s 147 of the Act. It is equally well-settled that if no such notice is issued or notice issued is invalid and not in accordance with law or notice is not served on the proper person then assessment framed would be illegal and without jurisdiction. Therefore, we find that the Tribunal has taken correct view in these appeals. Accordingly, the appeals are dismissed.
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2007 (12) TMI 471
Issues involved: Whether the receipt received by the assessee from General Electric Company USA for agreeing to refrain from carrying on competing business under a restrictive covenant is income exigible to tax? Whether the amount received under the agreement for not carrying out any activity in relation to business is exigible to tax or attracts capital gains?
Judgment Details:
1. The Tribunal noted that the amount received by the assessee is a capital receipt and is not liable to tax. The Revenue contended that the amount cannot be considered a capital receipt as the existing income-earning apparatus was not destroyed or impaired. The Tribunal referred to the amendment of section 28 by the Finance Act, 2002, introducing sub-clause (va) which proposed to tax receipts in the nature of non-compete fees. The Tribunal held that since the amendment was operative from April 1, 2003, the amount received under the agreement for not carrying out any business activity was not exigible to tax for the relevant year.
2. Regarding the question of whether the receipt would attract capital gains tax, the Tribunal relied on an instruction issued by CBDT stating that for consideration received for the transfer of a right to manufacture, produce, or process, recourse to section 55(2) could only be made from the assessment year 1998-99. Since the cost of acquisition was nil in the present case, it was held that the amount was not exigible to capital gains tax for the relevant year.
3. The Court found no error in the Tribunal's conclusion regarding the prospective nature of the amendment and its non-applicability to the assessment year under consideration. Similarly, concerning the issue of capital gains, it was determined that there was no error of law, leading to the dismissal of the appeal.
Conclusion: The appeal was dismissed, upholding the Tribunal's decision that the amount received under the restrictive covenant was not exigible to tax and did not attract capital gains for the relevant assessment year.
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2007 (12) TMI 470
Issues Involved:
1. Deduction u/s 80HHE of the IT Act.
2. Penalty proceedings u/s 271(1)(c) of the IT Act.
Summary:
1. Deduction u/s 80HHE of the IT Act:
The assessee, engaged in software export technical services, claimed a deduction u/s 80HHE of the IT Act for services rendered abroad. During assessment, a survey u/s 133A revealed agreements related to job placement. The AO concluded that the assessee was providing human resource services, not technical services for software development, and disallowed the deduction claim. The CIT(A) confirmed the AO's decision, which became final as the assessee did not pursue it further.
2. Penalty proceedings u/s 271(1)(c) of the IT Act:
Post the quantum appeal decision, the AO initiated penalty proceedings u/s 271(1)(c) and imposed a penalty. The CIT(A) upheld this penalty. However, the Tribunal ruled in favor of the assessee, stating no penalty was needed as the assessee neither filed inaccurate particulars nor concealed income. The Tribunal referenced CBDT's Notification No. 11521 and Circular No. 3 of 2004, which clarified that human resource services could qualify for deductions u/s 80HHE, supporting the assessee's bona fide belief.
The Tribunal's decision was challenged, questioning the legality of deleting the penalty. The Tribunal cited the Supreme Court's interpretation in T. Ashok Pai vs. CIT and other cases, emphasizing that penalty u/s 271(1)(c) requires proof of deliberate concealment or furnishing of inaccurate particulars. The Supreme Court highlighted that mere omission or negligence does not constitute concealment and that penalty provisions must be construed strictly.
Conclusion:
The High Court, considering the Tribunal's findings and the Supreme Court's legal exposition, found no illegality in the Tribunal's order. The appeal was dismissed, upholding the Tribunal's decision to delete the penalty imposed u/s 271(1)(c) of the IT Act.
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2007 (12) TMI 469
Issues Involved:
1. Disallowance of expenditure on Amarkantak Thermal Power Project.
2. Disallowance u/s 438 related to Employees' and Employers' contributions to PF and ESI.
Summary:
Issue 1: Disallowance of Expenditure on Amarkantak Thermal Power Project
The assessee contested the disallowance of Rs. 6,64,01,149/- incurred towards the Amarkantak Thermal Power Project by the learned DCIT. The DCIT argued that such expenditure cannot be allowed unless there is a corresponding credit in the form of contract receipt or work in progress. The CIT(A) upheld this view, stating that the non-reflection of the project cost as work in progress is not in accordance with the mercantile system of accounting. The assessee argued that the Madhya Pradesh Electricity Board (MPEB) had arbitrarily terminated the project, making the expenditure an allowable expense under the Income-tax Act, 1961. The assessee further contended that the arbitration proceedings' outcome was uncertain, and thus, no enforceable right existed over the impugned amount. The learned CIT(A) did not accept this argument, emphasizing that the expenditure should be shown as work in progress or as an amount recoverable from MPEB. The Tribunal agreed with the CIT(A), noting that the assessee had not followed a consistent system of accounting and had written off prior period expenses in the impugned assessment year, which was not justified. Consequently, the Tribunal dismissed the issue regarding the loss of the project written off.
Issue 2: Disallowance u/s 438 Related to Employees' and Employers' Contributions to PF and ESI
The assessee also contested the disallowance of Rs. 87,619/- towards employees' contribution to PF, Rs. 1,612/- towards employees' contribution to ESI, Rs. 87,619/- towards employers' contribution to PF, and Rs. 4,363/- towards employers' contribution to ESI. The learned CIT(A) confirmed the disallowance framed by the AO. However, the Tribunal noted that the Hon'ble Karnataka High Court had settled this issue in favor of the assessee in the case of M/s Sabari Enterprises and others, holding that belated payments before the due date of filing the return would be allowed as a deduction under the amended provisions of section 43B. Therefore, the Tribunal allowed the issue related to the contribution of PF and ESI.
Conclusion:
The appeal was partly allowed, with the issue regarding the loss of the project written off being dismissed and the issue relating to the contribution of PF and ESI being allowed.
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2007 (12) TMI 468
Issues involved:
The issue involves determining whether the capital gains arising from the sale of a residential house should be treated as long term capital gains.
Summary:
The appeal was filed by the revenue challenging the order of the Income Tax Appellate Tribunal regarding the assessment year 1998-99. The assessee was allotted a site by the Bangalore Development Authority under a lease cum-sale deed, subsequently obtaining ownership through a sale deed. The assessee constructed a house on the site, let it out, and later sold it. Claiming exemption under sec. 54 of the Income Tax Act, the assessee purchased another residential house. The Assessing Officer treated the capital gains as short term, but the Tribunal considered it as long term capital gains based on the provisions of section 2(47) (v) and the definition of 'transfer'. The revenue challenged this decision, arguing that the sale could not be considered long term as the sale deed was obtained in 1996 and the sale occurred in 1997.
The High Court noted that the assessee was in possession of the property since 1992, enjoying it as an owner under the terms of the agreement. Referring to a previous case, the court held that possession under part performance of a contract should be treated as ownership from the date of possession. Therefore, as the assessee had possession for over 36 months before the sale in 1997, it qualified as long term capital gains under Sec.2(42) of the Income Tax Act. The court found no justification to interfere with the Tribunal's decision and ruled against the revenue, dismissing the appeal.
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2007 (12) TMI 467
Issues involved: Interpretation of capital gains tax u/s 2(47) and possession of property u/s 53A of Transfer of Property Act for assessment year 1992-93.
Summary:
The appeal by the revenue raised the question of whether the Tribunal was correct in considering the capital gains offered by the assessee for the assessment year 1992-93, despite the sale deed being registered later and permission to cut trees obtained in the next assessment year. The assessee agreed to sell land, received sale consideration, and put the purchaser in possession under section 53A of the Transfer of Property Act. The department argued that since permission to cut trees was obtained in the next year, capital gains tax should be computed for 1992-93. The Commissioner of Income Tax (Appeals) partially allowed the appeal, and the Income Tax Appellate Tribunal upheld the assessee's position based on relevant legal definitions. The High Court concurred with the Tribunal's decision, citing the provisions of section 2(47) and section 269UA(d) of the Income Tax Act. The appeal was dismissed, leaving the revenue to complete the assessment for the year 1992-93.
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2007 (12) TMI 466
What shall be the standard of originality in the copy-edited judgments of the Supreme Court which is a derivative work and what would be required in a derivative work to treat it the original work of an author and thereby giving a protected right under the Copyright Act, 1957 to the author of the derivative work ?
Whether the entire version of the copy-edited text of the judgments published in the appellants law report SCC would be entitled for a copyright as an original literary work, the copy-edited judgments having been claimed as a result of inextricable and inseparable admixture of the copy-editing inputs and the raw text, taken together, as a result of insertion of all SCC copy-editing inputs into the raw text, or whether the appellants would be entitled to the copyright in some of the inputs which have been put in the raw text ?
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2007 (12) TMI 465
Issues Involved:
1. Compliance with Section 55 of NDPS Act.
2. Preparation and handling of test memo.
3. Discrepancy in the weight of samples.
4. Credibility of panch witnesses.
5. Conviction based on conjectures and inconsistencies.
6. Statement under Section 67 of NDPS Act.
Summary:
1. Compliance with Section 55 of NDPS Act:
The appellant argued that there was no compliance with Section 55 of the NDPS Act as the samples were not kept in safe custody. The evidence showed that the samples were deposited in the malkhana on 31st March 1999, and there was no evidence of their custody between 17th November 1998 and 31st March 1999, raising the possibility of tampering. However, the court found that the case property was deposited in the Custom Warehouse on 17th November 1998 and later transferred to a new godown on 31st March 1999, with seals intact, thus dismissing the argument of tampering.
2. Preparation and Handling of Test Memo:
The appellant contended that the test memo was prepared on 18th November 1998, a day after the seizure, and the seal was collected back for this purpose, suggesting possible tampering. The court held that the preparation of the test memo on the next day did not invalidate the case as the samples were sealed on the spot and the seals were intact when received by CRCL. The court emphasized that no law mandates the test memo to be prepared immediately at the time of seizure.
3. Discrepancy in the Weight of Samples:
The appellant highlighted discrepancies in the weight of the samples sent to CRCL, which varied from 6.1 gm to 7.1 gm, whereas 5 gm samples were claimed to be sent. The court explained that variations in weight are natural due to differences in the accuracy of balances used by the Investigating Officer and CRCL. The court found no malafide intent in the weight discrepancies, considering them a sign of the case's genuineness.
4. Credibility of Panch Witnesses:
The appellant argued that the panch witness PW 5 did not fully support the prosecution case and had discrepancies in his testimony. The court found that the testimonies of PW 1 and PW 5 regarding the recovery of heroin were unassailed and credible. The court dismissed the argument that the witness's inability to recall irrelevant details affected his credibility.
5. Conviction Based on Conjectures and Inconsistencies:
The appellant claimed that the conviction was based on conjectures and inconsistencies in witness statements. The court found that the testimonies of PW 1 and PW 5 were consistent and credible, proving the recovery of heroin beyond reasonable doubt. The court rejected the argument of inconsistencies affecting the conviction.
6. Statement under Section 67 of NDPS Act:
The appellant's statement under Section 67 of the NDPS Act was not retracted during the trial. However, the court clarified that the conviction was not based on this statement but on the evidence of recovery and testing of heroin.
Conclusion:
The court found no infirmity in the judgment of the Trial Court and dismissed the appeal, upholding the conviction and sentence of the appellant.
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2007 (12) TMI 464
Issues:
Petitioner seeking anticipatory bail for alleged violation of Section 9 of the Central Excise Act 1944.
Detailed Analysis:
The petitioner sought anticipatory bail for allegedly evading excise duty amounting to Rs. 118 crores, arguing that he was not responsible for the evasion as he had resigned in 2005, and the evasion related to the year 2006-07 when he was not the Director of the company. The prosecution contended that Section 9 applied to any person evading duty, regardless of their position in the company, and that the petitioner, being a shareholder, was liable for prosecution. The defense emphasized Section 9 AA, stating that the prosecution must show the petitioner's involvement in the offense, either as a Director or in charge of the company's affairs. They also highlighted that the offense was now compoundable and non-cognizable, limiting the enforcement agency's power to arrest without proper procedure.
The enforcement agency opposed anticipatory bail, citing previous judgments and the seriousness of the duty evasion. They argued against bail based on the potential hindrance to the investigation, as seen in a previous case involving grave allegations of foreign exchange. The petitioner's counsel countered these arguments by asserting that the petitioner was not a Director during the relevant period and was not responsible for the company's business conduct, making the cited authority inapplicable to the current case.
After hearing both parties, the court noted that the petitioner was not a Director or responsible for the company's business conduct during the alleged offense period. Considering the completed investigation due to the detention of co-accused, the court found sending the petitioner to jail unnecessary. While the court could have imposed a deposit condition for the alleged duty evasion, the petitioner's resignation in 2005 in relation to the 2006-07 evasion made such a directive inappropriate. Consequently, the court granted the petitioner anticipatory bail, with the condition of executing a personal bond and joining investigations when summoned by enforcement officers.
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2007 (12) TMI 463
The Bombay High Court stated that the refund application is in process. The order will be passed within three weeks after the petitioners provide the required information. The respondents must request the information within one week.
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