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Showing 81 to 100 of 2184 Records
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2018 (5) TMI 2110
Seeking Injunction restraining the respondent authorities - breach on the part of the petitioners of the terms of the loan covenants entered with the State Bank of India - threatening to publish photographs, names and addresses of the petitioners in leading newspapers - HELD THAT:- From the documents annexed to the writ petition there is no doubt that the Company of which the petitioners are directors and guarantors (for the financial assistance availed of by the Company), have acknowledged and admitted their liability in respect of the credit facilities obtained from the respondent bank. The response of the Company to the notice under Section 13(2) of the SARFAESI does not dispute this liability. It is also clear from the impugned letter dated 19th November 2014, which is under challenge in this proceeding, that the Company had been advised to repay the loan amount by 10th December 2014 and that admittedly no steps have been taken by the Company thereafter to honour its financial obligations to the respondent bank. The company has instead filed a suit and an application before the Debts Recovery Tribunal in an attempt to push back their obligations to the bank.
The judgement of this Court provides a window of "Special Circumstances" when the bank can proceed with such coercive measures against borrowers who have committed deliberate default of the RBI Guidelines with mala-fide intention. This window cannot, however, be applied in the present case since, it cannot be from the material on record said that the Company has wilfully defaulted in its financial obligation to the respondents Bank or that the petitioner as Directors and Guarantors of the Company can be held liable for the conduct complained of on the part of the Company. The decisions relied on by the Bank with regard to the limited sphere of interference of a Court in relation to show-cause notices are not applicable since the impugned letter dated 19th November, 2014 cannot be construed as a show-cause notice per-se.
The interim order passed by this Court on 20th January, 2015 is confirmed.
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2018 (5) TMI 2109
Revision u/s 263 by CIT - unexplained cash deposits - As per CIT AO not made addition of cash deposits in IDBI Bank and in Axis Bank and not made any enquiry regarding acquisition of shares - case was reopened u/s.147 and assessment was made under section 143(3) read with section 147 - HELD THAT:- We find that the assessee has disclosed bank account with IDBI in her balance sheet filed along with return of income, and same are claimed as cash sales, which have been accepted by the AO after making enquiry, therefore, same cannot be treated as undisclosed. Similarly, with regard to investment in shares, we find that Pr.CIT has not pointed out that which shares are held by the assessee - in consequent to proceeding under section 263, an assessment order was passed wherein the AO has not made any addition on account of investment in shares but made some other deposits which are still not clear. Thus, we find that the AO has made enquiry and taken a plausible view after application of mind.
The order passed by the AO, in our opinion, shall be deemed to be erroneous in so far as it prejudicial to the interest of the Revenue, if the Pr.CIT would have specifically pointed out that which of inquiries or verification should have been carried out by the AO in this regard and the AO failed to carry out those inquiries and verification as desired by the Pr. Commissioner of Income-tax. Since the Pr.CIT has not suggested the basis of inquiry or verification to be carried out by the AO, the order passed by the AO cannot be deemed to be erroneous in so as far as it is prejudicial to the interest of the Revenue.
AO has considered cash deposits as unexplained and considered the same in the case of Shri Ankit V. Parekh and made addition on this account by estimating profit @ 8%. It may also be noted that assessment was reopened for verification of these very deposits, therefore, it was incumbent on the AO to make such enquiry in respect of these issues. In view of these facts and circumstances, we find that the AO has made due enquiries. Since we find that the AO had made enquiries regarding cash deposits in bank account and taken a view and considered for addition and accepted the version of the assessee that bank account with IDBI was disclosed and not made any addition on this treating it as disclosed and on shares as no investment in shares was found to have been made by the assessee. Thus, the view taken by the AO was plausible view, which cannot be disturbed by the ld. Commissioner of Income-tax - Decided in favour of assessee.
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2018 (5) TMI 2108
Penalty u/s 271(1)(b) - assessee has not complied with the notice fixing the date of hearing in assessment proceedings - assessee received notices under section 153A - HELD THAT:- As per the case of a group company in Glenasia Commodities Pvt. Ltd [2017 (10) TMI 1596 - ITAT DELHI] we are of the considered opinion that the plea taken by the assessee that because of the huge work involved in furnishing information in 12 cases for 6 years constitutes a proper and plausible explanation. Further, we find that the ratio laid down in Akhil Bharatiya Prathmik Shikshack Sangh Bhawan trust’s [2007 (8) TMI 386 - ITAT DELHI-G] case squarely applies to the facts of this batch of cases. We, therefore, find that the penalty levied under section 271(1)(b) of the act cannot be sustained. We accordingly direct the Ld. AO to delete the same. - Decided in favour of assessee.
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2018 (5) TMI 2107
Disallowance interest on interest fee advance - HELD THAT:- As decided in own case [2016 (7) TMI 1631 - ITAT DELHI] issue decided the issue in favour of the assessee.
Disallowance u/s 14A read with Rule 8D - AO observed that the assessee has received tax free dividend income on long term trade investment and claimed the same as exemption u/s 10 (34) - Suo moto disallowance made by assessee - CIT (A) restricted the disallowance as disallowed by the assessee itself - HELD THAT:- Since, in the instant case also the assessee itself has disallowed an amount of ₹ 2.50 as against actual dividend of ₹ 1,70,096/- therefore, following the decision of the Tribunal in assessee’s own case in the immediately preceding assessment year which are in consonance with the decisions of Hon’ble Delhi High Court MAXOPP INVESTMENT LTD., CHEMINVEST & OTHERS [2011 (11) TMI 267 - DELHI HIGH COURT] find no infirmity in the order of the CIT(A). Accordingly the same is upheld and the ground raised by the revenue is dismissed.
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2018 (5) TMI 2106
Bogus purchases - as per DR two companies are only issuing accommodating entries without there being actual sale and therefore, the AO was justified in disallowing the bogus purchases - HELD THAT:- As assessee has made the payments to the parties through banking channels and therefore, the party was rightly identified. Further, the assessee has made the sales of these items and offered the income therefrom to tax. Once the Department accepts the sale, it cannot disallow the corresponding purchases.
When all the documents were on the file of the AO, he ought to have verified the genuineness of the sale instead of depending solely on the statement of the Rajendra Jain Group. In view of the same, we deem it fit and proper to remit the issue to the file of the AO for verification of the documents filed by the assessee and if it is found that the payment has been made by the assessee through banking channels and the purchases and sales have also been recorded in the books and the net profit has been offered to tax, then there cannot be any disallowance of the purchases. Appeal of the assessee is treated as allowed for statistical purposes.
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2018 (5) TMI 2105
Issues: Settlement of dispute, withdrawal of appeal, terms and conditions of agreement, disposal of appeals
The judgment delivered by the National Company Law Appellate Tribunal, New Delhi involved a settlement of a dispute between the parties. The learned counsel for the Appellant informed the Tribunal that the parties had reached a settlement, as evidenced by the Minutes of the 6th Meeting held in Chennai. The Respondent, represented by Mr. Amrendra Saran, highlighted that as per the terms and conditions of the agreement, the Appellants were required to withdraw the appeal. Mr. Saran handed over a cheque of &8377; 40,00,00,000/- to the Appellant's counsel for onward transmission, issued by the State Bank of India. The Appellant's counsel, upon receiving instructions, sought permission to withdraw the appeal in light of the settlement. Consequently, all appeals were disposed of as withdrawn, with the parties directed to act in accordance with the agreement. The Tribunal's decision was based on the mutual agreement and the fulfillment of the terms outlined in the settlement, leading to the withdrawal of the appeals and the resolution of the dispute as per the agreement reached by the parties.
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2018 (5) TMI 2104
Assessee in default u/s 201(1) - Assessment in the name of a non-existing company - assessee argued assessment order was passed in the name of a non-existing company i.e Vodafone South Ltd. as merged with Vodafone Mobile Services Ltd. - HELD THAT:- We find that the assessee “Vodafone South Ltd.,” had merged with “Vodafone Mobile Service Ltd.,” and had intimated to the relevant A.O and CIT(A) about the said merger. We find that the A.O had issued the notice in the correct name, but while passing the assessment order, he has mentioned the earlier name of the assessee.
Hon’ble Supreme Court in a recent case of Skylight Hospitality LLP [2018 (4) TMI 529 - SC ORDER] has held that the wrong name given in the notice was merely a clerical error which could be corrected u/s 292B of the IT Act. In fact, the A.O has passed a corrigendum dated 22.01.2018, correcting the name of the assessee and therefore, there is no infirmity in the assessment order. In view of the same, the additional grounds of appeal raised by the assessee is rejected.
TDS u/s 194C - Liability to deduct tax at source on discount extended to its pre-paid distributors on distribution of pre-paid services - Since the issues are covered in favour of Revenue in the assessee’s own case by the decisions of the jurisdictional High Court, we are bound to follow the jurisdictional High Court and therefore the grounds are rejected and the orders of the A.O and CIT(A) on this issue are confirmed. Accordingly, assessee’s appeals are dismissed.
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2018 (5) TMI 2103
Reopening of assessment u/s 147 - Addition u/s 68 - assessee has not satisfactorily explained the identity and creditworthiness of the shareholder and the genuineness of the transactions - HELD THAT:- As the original assessment in the instant case was completed u/s 143(3) on 02.04.2009 and the Assessing Officer had accepted the raising of share capital on the basis of various details furnished by the assessee and since the notice has been issued after a period of four years from the end of the relevant assessment year and in the said notice there is no allegation of any failure on the part of the assessee to disclose fully and truly all material facts necessary for completion of the assessment, therefore, we do not find any infirmity in the order of the ld. CIT(A) in holding that the reopening of the completed assessment u/s 148 and re-assessment u/s 147/143(3) is not as per law and are void ab-initio. The various decisions relied on by ld. DR are distinguishable and not applicable to the facts of the present case. The grounds raised by the Revenue are therefore dismissed.
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2018 (5) TMI 2102
Revision u/s 263 by CIT - Hawala/Bogus purchases - Reopening of assessment u/s 147 - case of the Pr.CIT in the revision order is that the AO failed to make enquiries before completing the assessment on the claims relating to bogus purchases and the sundry creditor balances - receipt of information from the DG (Investigation), Pune as supplied by the Sales Tax Department - AO in restricting the addition i.e. 20% of the said bogus purchases - HELD THAT:- It is a case of taking plausible view by the AO on the issue under consideration. In the revision order, the Pr.CIT did not agree with the said view and restored the issue to the file of AO for fresh assessment implying in favour of making addition of entire such purchases. In this process, Pr.CIT ignored the fact relating to existence of various views on this issue. We have also noticed on the issue of bogus purchases, there are various views inviting debates on the requirement of making entire additions or GP additions of various rates or various GP rates etc. Therefore, making addition on account of bogus purchases constitutes a debatable one. As such, the AO has taken one prevailing view in this matter. Therefore, thrusting another view by the Pr.CIT in his revision order in our view is outside the scope of provisions of section 263. Therefore, it is not a clear cut case of erroneous assumption of law as made out by the Pr.CIT. Hence, the revision order on this issue is unsustainable in law. Accordingly, relevant grounds raised by the assessee on this aspect are allowed.
Regarding the other issue of sundry creditors issue was not at all taken up in the re-assessment proceedings. The reasons recorded by the AO supports the same. Normally, such issues are taken up in the regular assessment u/s.143(3) of the Act. In this case, there is no such order passed by the AO at the relevant point of time. Further, it is not the case of the Revenue that the issue of sundry creditors was not examined by the AO.
Therefore, we find the issues above narrated by the Pr.CIT are general and casual. It is not the case of the Pr.CIT that the above issues were allowed by the AO after due process of verification of scrutiny of the account. As such, AO is not under any mandate to examine sundry creditor account - also not the case of the Pr.CIT that there is something erroneous about the sundry creditor account and therefore, the AO failed to make proper/adequate enquiries on this issue.
Pr.CIT’s finding is too general and the same is unsustainable. He failed to make out a case that allowing claims of the assessee on this issue amounts to erroneous order of the AO in so far as it is prejudicial to the revenue. In the absence of any categorical finding on erroneous assumption of law/fact leading to loss of revenue, the finding of the Pr.CIT is not sustainable. Therefore, we are of the opinion that the directions given by the Pr.CIT are liable to be quashed. Accordingly, the re-assessment order of the AO is restored. The grounds raised by the assessee are allowed.
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2018 (5) TMI 2101
Concessional rate of tax - mining services - generation of the electricity - Section 8(1) of the Central Sales Tax Act, 1956 - HELD THAT:- Section 8(1) to be read with Section 8(3) to be read with Section 8(d) of the Central Sales Tax Act, 1956 vis-a-vis Article 246-A and 101st amendment to the Constitution of India, otherwise, at interim stage, all the petitions will be decided finally. As there is a prima-facie case in favour of these petitioners, balance of convenience is also in favour of these petitioners and if the stay, as prayed for, is not granted, it will cause irreparable loss to these petitioners.
The State of Jharkhand is hereby directed to issue necessary ‘C’ Forms, without prejudice to their rights and contentions and such ‘C’ Forms may be utilized by these petitioners with the undertaking as noted hereinabove and all such actions shall be subject to the outcome of these writ petitions.
Application allowed.
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2018 (5) TMI 2100
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - time limitation - HELD THAT:- Since the amount of debt claimed is ₹ 2,54,84,828/- which is above 1 lakh and the default occurred on 24.07.2017, the debt is not time barred and the application is filed within the period of limitation - As the registered office of the Corporate Debtor is in Delhi, so the matter falls within the territorial jurisdiction of this Tribunal.
The parameters to initiate CIRP as required under Insolvency and Bankruptcy Code are duly complied with and the application is complete - Corporate Debtor despite repeated service has not appeared before this Tribunal and existence of a default of debt due to the Applicant is established. The Tribunal is of the considered view that this application requires to be admitted and that CIRP process is required to be initiated against the Corporate Debtor.
Application admitted - moratorium declared.
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2018 (5) TMI 2099
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - existence of debt and dispute or not - HELD THAT:- The form and manner of the application has to be the one as prescribed. It is evident from the record that the application has been filed on the proforma prescribed under Rule 4 (2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 read with Section 7 of IBC.
It is satisfied that a default has occurred and the application under sub section 2 of Section 7 is complete. The name of the IRP has been proposed and there are no disciplinary proceedings pending against the proposed Interim Resolution Professional.
Petition admitted - moratorium declared.
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2018 (5) TMI 2098
Maintainability of petition - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - existence of debt and dispute or not - Operational Creditors - Case is being transferred from High Court - Section 8 Notice was issued after the service of Main Petition - HELD THAT:- Admittedly this case had been transferred from the Hon’ble High Court and in such transferred cases the requirement is to submit all information forming part of the records transferred from the Hon’ble High Court and the Petition is to be Admitted U/s. 7, 8 or 9 of the Code. The other admitted position is that while the old Petition was filed before the Hon'ble High Court a Notice was issued on 03.03.2015 under the provisions of Section 433(e) of the Companies Act. That Notice was a legal Notice stating all the facts of the Debt in question along with requisite evidences such as Invoices etc. to establish the genuineness of the Debt.
Notification No. GSR 1119(E) dated 07.12.2016 notified for Transfer of Proceedings Rules, 2016 is worth mentioning. Considering the Notification issued and on comparing with the provisions of the Code it is logical to hold that there is no legal requirement to issue Notices of Demand repeatedly. The duplicity of issuance of Notice of Demand is not a requirement of Law.
he Debt and the occurrence of default is established. Accordingly, this Petition under consideration deserves to be “Admitted” - petition admitted - moratorium declared.
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2018 (5) TMI 2097
Maintainability of writ appeal - Seeking police to register a crime and investigate it - Criminal breach of trust - misappropriation breaking out in the open - misdeeds amounting to cognizable offences - police refused to register an FIR - criminal jurisdiction - principle of issue estoppel, first and foremost, affect the writ petition or not? - Permission to do away with the statutory remedies and, instead, take a straight recourse to judicial review? - Ratio v. Obiter v. Holding - Lalita Kumari - Are there any issues sub silentio? - Can a complainant disregard the alternative remedies provided under, say, the Criminal Procedure Code and, instead, insist on a writ remedy? - Refusal to Register a Crime-the Alternative Remedies.
Is the writ appeal maintainable? - HELD THAT:- Section 5 of the Kerala High Court Act mandates that an appeal shall lie to a bench of two judges from "(i) a judgment or order of a Single Judge in exercise of original jurisdiction), and (ii) a judgment of a Single Judge in exercise of appellate jurisdiction in respect of a decree or order made in exercise of original jurisdiction by a subordinate court." - there is no exclusion of the orders passed by a learned Single Judge in exercise of a criminal jurisdiction." - Given the emphatic enunciation of law by a co-equal Bench of this Court, it is held that the intra-court appeal is eminently maintainable.
Does the principle of issue estoppel, first and foremost, affect the writ petition? - HELD THAT:- The issue of estoppel stands merged, as observed by the Supreme Court, State of Jharkhand v. Lalu Prasad Yadav [2017 (5) TMI 490 - SUPREME COURT] in the principles of Autrefois acquit and Autrefois convict, both of which find enshrined in article 20(2) and section 300 Cr.P.C. Indeed, issue estoppel, a common law doctrine, has been well-entrenched and oft-applied to criminal proceedings. The courts in India, too, have applied this principle at all levels, Apex to trial courts - given the finding on maintainability in the next few paragraphs, this issue becomes academic. And academic issues need no adjudication. So we reckon that our finding on the threshold issue, alternative remedy, obviates an answer to this issue.
Does the Supreme Court in Lalita Kumari [2013 (11) TMI 1520 - SUPREME COURT] permit a complainant to do away with the statutory remedies and, instead, take a straight recourse to judicial review? - Pithily put, what is the holding of Lalitha Kumari? - HELD THAT:- The issue before the Supreme Court was this: is a police officer bound to register an FIR under section 154 of Cr.P.C., upon receiving any information relating to the commission of a cognizable offence or has he got the power to conduct a preliminary inquiry to test the veracity of such information before registering the crime? - Lalita Kumari's holding is simple and straight: If an aggrieved person approached the police complaining of a cognizable offence, they must register an FIR and promptly enquire into the crime, the arrest of the accused not being an essential step in that process.
Ratio v. Obiter v. Holding - HELD THAT:- Holding emerges when the ratio, the pure principle of law, is applied to the facts of a particular case. That is, a holding is what the court actually decides after combining the facts of a case with the legal principles it deduces in the context of that case - Ratio requires adherence to the extent possible, but the holding compels compliance fully. Stare decisis admits of no exception to a case-holding in the adjudicatory hierarchy.
Lalita Kumari - Are there any issues sub silentio? - HELD THAT:- Once an issue, though present by implication, has not been expressly dealt with and pronounced upon, the judgment on that issue remains sub silentio. Any issue, thus, rendered sub silentio cannot be treated as a precedent - Lalita Kumari, however, had no occasion to consider the issue we have now been confronted with: The alternative statutory remedies available to a complainant after the police's refusing to register an FIR. So we may safely conclude that Lalita Kumari does not obliterate, as it were, the alternative statutory remedies available to the aggrieved complainant.
Can a complainant disregard the alternative remedies provided under, say, the Criminal Procedure Code and, instead, insist on a writ remedy? - HELD THAT:- Despite the repeated attempts of some members failing to bring the police to the Church's door, Shine maintains that one complaint pending before the Magistrate does not affect his right to maintain another one on his own. In Pramatha Nath Taluqdar vs. Saroj Ranjan Sarkar [1961 (11) TMI 63 - SUPREME COURT], a three-Judge Bench of the Supreme Court has held that that there is nothing in the law prohibiting a second complaint on the same allegations when a previous complaint had been dismissed under s. 203 of the Code of Criminal Procedure. Indeed, Pramatha Nath deals with the second complaint by the same person upon having the first one dismissed. It does not apply here.
How Has the Impugned Judgment Proceeded? - HELD THAT:- We have already discussed Lalita Kumari and extracted its holding. We have also held that Lalita Kumari has not dealt with the remedies available to an aggrieved person on whose complaint about a cognizable offence the police have not acted. In fact, Lalita Kumari has only dealt with the issue whether the police could exercise their discretion and indulge in any preliminary enquiry before they register a crime. Therefore, the precedents speaking on a complainant's alternative remedies have not been set at naught. They still hold the field. That said, we must now examine the precedential position on that issue.
Refusal to Register a Crime-the Alternative Remedies - HELD THAT:- Clear and compelling are the judicial directions vis-à-vis an aggrieved person's approaching the High Court. But, disregarding the efficacious alternative-remedies under the Code, the complainants insisted that in Lalitha Kumari, a Constitution Bench has cleared the complainant's path of all statutory hurdles to approach the High Court, straight away.
Shine Varghese has faltered at the first hurdle-the alternative remedy, which he has on more than one count. That is, the impugned judgment suffers from legal infirmity and deserves to be set aside - writ appeal allowed.
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2018 (5) TMI 2096
Validity of Assessment u/s 153A - incriminating documents found in search or not ? - HELD THAT:- In the instant case, we find that there is no dispute to the fact that no incriminating material was found pertaining to assessment year 2007-08 and only the purchase documents in the shape of registered sale deed were found which were duly disclosed in the regular books of accounts.
Assessing Officer could not have reopened the assessment if in case the assessment has been completed earlier u/s 143(3) of the Act for the assessment year 2007-08 but this is not so in the case of the assessee because for the assessment year 2007-08 the return of the assessee was merely processed u/s 143(1)(a) of the Act which by no canon can be accepted as regular assessment and, therefore, the Assessing Officer had no occasion to examine the related transactions for the assessment year 2007-08. During the course of search, documents were found relating to purchase of property as well as incriminating material for undisclosed investment in construction of property which was sufficient enough for the Assessing Officer to initiate the assessment proceedings for the assessment year 2007-08 to assess the correct income of the assessee. We, therefore, set aside the findings of the learned Commissioner of Income Tax (Appeals) and hold that the assessment for the assessment year 2007-08 u/s 153A r.w.s. 143(3) of the Act was valid. The relevant grounds of the revenue for the assessment year 2007-08 are allowed.
Addition for the undisclosed investment in land and building - HELD THAT:- On the objections raised by the assessee, learned Commissioner of Income Tax (Appeals) again directed for a fresh valuation. Vide Departmental Valuation Officer’s valuation report dated 17.5.2016 the fair market value of the property was valued assessment ₹ 70,05,000/-. As a result, the addition was sustained at ₹ 7,05,000/-. These facts clearly show that there was variation in the valuation report of the Departmental Valuation Officer. This is not the revenue’s case that there was any objection by the Registrar for payment of stamp duty and the purchase consideration was also not questioned. The alleged addition is also within the range of 10% of the cost of land and building shown by the assessee. We, therefore, are of the considered opinion that no addition was called for towards unexplained investment in purchase of property.
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2018 (5) TMI 2095
Depreciation on intangible assets i.e. know-how, patents and trademark, goodwill and non-compete fee - HELD THAT:- As following the decision of Hon'ble Apex Court in the case of CIT Vs. Smifs Securities Ltd.[2012 (8) TMI 713 - SUPREME COURT] held that the assessee is eligible for claiming depreciation on know-how, patents and trademarks. Since, this issue has already been dealt in detail by the Co-ordinate Bench in assessee’s own appeal for assessment year 2004-05 [2018 (1) TMI 12 - ITAT PUNE] and 2005-06 [2018 (1) TMI 12 - ITAT PUNE] allowing the claim of assessee, we apply the same reasoning to allow grounds No. 2, 3 and 4 in the present appeal of the assessee as well. It is an undisputed fact that there is no change in the facts and circumstances in the assessment year 2006-07. The ld. DR has not brought before us any judgment wherein contrary view has been taken.
Valuation of land at Taloja and Panki - scope of Business Transfer Agreement (BTA) - HELD THAT:- As decided in own case for assessment year 2004-05 [2018 (1) TMI 12 - ITAT PUNE] no merit in the stand of CIT(A) that the land at Taloja was transferred by ICI India Ltd. to the assessee under BTA and hence, the value of slump price is first to be attributed to the cost of said land - assessee fairly admitted that the value of ₹ 17.37 crores be attributed to Panki assets. However, revised allocation value of land at Panki would be ₹ 13 crores, out of total slump price of ₹ 153 crores. Accordingly, we direct the Assessing Officer to re-compute the value of both tangible and intangible assets, accordingly.
Valuation of trademark, patent and know-how acquired by the assessee from ICI India Limited - HELD THAT:- Identical ground was raised in appeal by assessee in assessment year 2004-05 [2018 (1) TMI 12 - ITAT PUNE] Find no merit in the stand of learned Departmental Representative for the Revenue that actual cost for entire block could be examined in the succeeding year if there were circumstances necessitating such change. We find no merit on the same and the same is rejected. Since we have decided the issue both on merits and also on preliminary issue of whether the WDV of assets could be disturbed in the succeeding year, we hold that the issue of enhancement whether can be made by the CIT(A) or not becomes academic in nature and the same is not adjudicated. Accordingly, we direct Assessing Officer to allow claim of depreciation on tangible assets; know-how, trademark and patents; goodwill and non-compete fee.
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2018 (5) TMI 2094
Exemption u/s 11 - charitable activity u/s 2(15) - assessee in addition to educational activities, also provide hostel and transport facilities to the students in its college - transportation and hostel running itself is not an educational activity and can at the most be said to be incidental to the object of the trust - HELD THAT:- As relying in assessee's own case [2017 (9) TMI 1030 - ITAT DELHI] and further stands supported by the decision of Rajasthan and Gujrati Charitable Foundation, Poona [2017 (12) TMI 1067 - SUPREME COURT]. Accordingly, the additions made by the ld. Authorities below deserve to be deleted and the appeal of the assessee to be allowed.
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2018 (5) TMI 2093
Disallowance of expenditure - addition made as not carried out any business activity - CIT-A restricted the disallowance to the 2/3rd of the total expenditure following the order of his predecessor for assessment year 2007-08 which was further confirmed by the Tribunal - HELD THAT:- As assessee could not convince us as to the business activity carried out by the assessee requiring the allowance of the entire expenditure claimed. We, therefore, do not find any reason to interfere with the above order of CIT(A) on this issue. Ground No.1 of the appeal is therefore, dismissed.
Notional disallowance of the interest expenditure u/s 36(i)(iii) - giving loans to sister concerns at low interest - Proof of business expediency - AO observed that during the year it had obtained term loan on which the assessee had paid interest @ 11% to the bank. However, the assessee during the year had also given loan / advance to its sister concern and charged interest @ 8% - HELD THAT:-We find that the case of the assessee is thus squarely covered by the aforesaid decisions of the Hon'ble Supreme Court in the case of ‘Hero Cycles P. Ltd v CIT’ [2015 (11) TMI 1314 - SUPREME COURT] and ‘Bright Enterprises Pvt Ltd Vs. CIT’ [2015 (11) TMI 342 - PUNJAB & HARYANA HIGH COURT] and Reliance Utilities and Power Ltd.’ [2009 (1) TMI 4 - BOMBAY HIGH COURT] wherein the Hon'ble Courts have held that where the own funds of the assessee were sufficient to meet the interest free advances given during the year, then the presumption would arise that such advances or investments had been made out of the own funds of the assessee - disallowance to be deleted - Decided in favour of assessee.
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2018 (5) TMI 2092
Disallowance of commission expenses paid - HELD THAT:- CIT(A) considering the submissions of the assessee deleted the disallowance observing that the recipient company is a loss making company and is not a ground for disallowance of commission. He also accepted the submissions of the assessee that M/s. Toshbro Controls Pvt. Ltd. is known to customers by its flag ship company and may not be aware of the subsidiary company and therefore the customer might have stated that they have got materials directly from the assessee company M/s. Nova Controls Pvt. Ltd. which is the flag ship company.
As find from the details that similar commission has been paid to M/s. Toshbro Controls Pvt. Ltd., during the Financial Years 2007-08 to 2014-15 and the percentage of total sales made through the M/s. Toshbro Controls Pvt. Ltd. by the assessee ranges from 58.30% to 78.78% and the commission paid ranges between 11.57% and 18.83% depending upon the percentage of sales to total sales. We find that that the Revenue has accepted the payment of commission in all the earlier years and disallowance was made only during this year and based on an apprehension that the sister concern is making loss and therefore assessee tried to shift the profits, this fact is not proved beyond doubt. When the commission paid by the assessee is accepted in all earlier years there is no reason why it should not be accepted during the Assessment Year under appeal - we do not find any infirmity in the order passed by the Ld.CIT(A) in allowing the claim of the assessee. Hence the order of the Ld.CIT(A) is sustained on this issue.
Disallowance of travelling expenses to 12.5% as against 25% disallowed by AO - HELD THAT:- As we are of the view that the matter be restored to the file of the Assessing Officer to substantiate the claim of travelling expenses by the assessee with evidences. Hence this issue is restored to the file of the Assessing Officer for fresh adjudication. This ground is allowed for statistical purpose.
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2018 (5) TMI 2091
Conversion of non-bailable warrants into bailable warrants - Section 3/4 of the PMLA Act, 2002 - HELD THAT:- The order for issuance of non-bailable warrant was also passed. Later part of the order is certainly dependent upon and consequent to the order of cognizance. If cognizance order is not maintained, then the order of calling the petitioners by way of arrest warrant also does not subsist.
Since the Hon’ble Apex Court is seized with the present controversy in the case of Directorate of Enforcement Vs.M/s. Obulapuram Mining Company Pvt. Ltd [2017 (7) TMI 1130 - SC ORDER] and the proceeding of this petition has been deferred to wait for the authoritative pronouncement on the issue, for the present, it cannot be said with certainty that the petitioners will not be able to get the relief.
Taking into account the possibility of favourable decision, the petitioners cannot be put to a dis-advantageous position by way of not allowing their prayer for converting the non-bailable warrants into bailable one. More so, when the existence of non-bailable warrant is dependent upon the existence of cognizance order. Secondly, the order passed on 15.3.2018 is also based and dependent on the order dated 12.3.2018. Laying a challenge to the basic order dated 12.3.2018 by which the non-bailable warrant was issued, is thus sufficient ground to consider the prayer made by the petitioners.
Non-bailable warrant should be issued to bring a person to court when summons of bailable warrants would be unlikely to have the desired result - As far as possible, if the court is of the opinion that a summon will suffice in getting the appearance of the accused in the court, the summon or the bailable warrants should be preferred. The warrants either bailable or non-bailable should never be issued without proper scrutiny of facts and complete application of mind, due to the extremely serious consequences and ramification which ensue on issuance of warrants. The court must very carefully examine whether the criminal complaint or FIR has not been filed with an oblique motive.
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