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2006 (8) TMI 621
Issues involved: Writ petition challenging the rejection of an application in a pending suit for directions to the plaintiff to either give evidence in person or allow cross-examination.
Summary:
The writ petition was filed by the second defendant in a pending suit where the plaintiff, claiming to be the wife of the deceased, had executed a power of attorney for the suit's conduct. The petitioner sought directions for the plaintiff to depose in person or allow cross-examination, which was rejected, leading to the present petition. The petitioner argued that the plaintiff cannot lead evidence through a power of attorney, citing a Supreme Court judgment. The Supreme Court clarified that a power of attorney holder can only act within the authorized scope and cannot depose on matters within the authorizer's personal knowledge.
The court emphasized that the duty of the court is to appreciate the case based on the evidence presented and not to direct parties on how to conduct their case. The request for cross-examination of the plaintiff was deemed inappropriate as it can only follow the chief-examination, which had not occurred. The court upheld the trial court's rejection of the application, stating that the petitioner can conduct their defense as per the law but cannot compel the plaintiff to act in a specific manner. Ultimately, the writ petition was rejected.
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2006 (8) TMI 620
Issues:
1. Requirement of pre-deposit of Service Tax.
2. Denial of benefit of Notification No. 12/2003-S.T. for Photography service.
3. Comparison with a previous ruling in the case of Adlabs v. CCE, Bangalore.
4. Stay application and appeal listing.
Analysis:
1. The judgment dealt with the issue of the requirement of pre-deposit of Service Tax amounting to Rs. 11,56,947/- as demanded in the Show Cause Notice dated 30-12-2004 for the periods 16-7-2001 to 30-9-2003 and 1-10-2003 to 31-3-2004. The appellants contested the demand, citing a Board's letter and Notification No. 12/2003-S.T., dated 20-6-2003, arguing that details of input materials used in the photography service need not be disclosed in the invoices.
2. The denial of the benefit of Notification No. 12/2003-S.T. for Photography service was a crucial issue in the judgment. The Revenue had contested the benefit based on the lack of details of input materials in the invoices. However, the appellants relied on the Notification and a previous ruling to support their stance. The Tribunal considered the arguments and decided to allow the stay application, granting waiver of pre-deposit of tax and penalty.
3. The judgment referenced a previous ruling in the case of Adlabs v. CCE, Bangalore - 2006 (2) S.T.R. 121(Tri.-Bang.), where a similar issue had been addressed, and the appeal had been allowed. The learned Counsel for the appellants highlighted this ruling to support their case for allowing the stay and appeal in the present matter. The Tribunal acknowledged the relevance of the cited judgment in similar cases and decided to grant the stay application unconditionally.
4. The issue of the stay application and appeal listing was crucial in the judgment. The Tribunal, after careful consideration and noting the precedent of allowing stay applications in similar matters, decided to grant the stay application unconditionally, waiving the pre-deposit of tax and penalty. The appeal was scheduled to be heard along with similar linked matters on 17th October 2006, ensuring a consistent approach in dealing with such cases.
This comprehensive analysis outlines the key issues addressed in the judgment, including the requirement of pre-deposit of Service Tax, denial of benefit under Notification No. 12/2003-S.T., comparison with a previous ruling, and the decision on the stay application and appeal listing.
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2006 (8) TMI 619
Issues Involved:
1. Conviction under Section 376 IPC.
2. Application of Explanation 1 to Section 376(2)(g) IPC.
3. Evaluation of prosecutrix's testimony and its consistency.
4. Determination of common intention and concerted action among accused.
Detailed Analysis:
1. Conviction under Section 376 IPC:
The accused were initially convicted under Section 376 IPC by the Additional Sessions Judge, Chandigarh. The High Court upheld the conviction of Lalit Gupta and Pardeep Kumar but acquitted Inderjit Singh. The present appeal by Pardeep Kumar challenges this conviction. The prosecution case, as per the FIR, detailed the events leading to the alleged gang rape, including the involvement of multiple accused.
2. Application of Explanation 1 to Section 376(2)(g) IPC:
The prosecution argued that Pardeep Kumar was guilty under Section 376 IPC due to the principle of joint liability, as per Explanation 1 to Section 376(2)(g) IPC. This provision states that if a woman is raped by one or more persons in a group acting with common intention, each member of the group is deemed to have committed gang rape. The court cited precedents like Ashok Kumar v. State of Haryana and Bhupinder Sharma v. State of Himachal Pradesh, emphasizing that common intention and concerted action are crucial for applying this provision.
3. Evaluation of Prosecutrix's Testimony and Its Consistency:
The High Court relied on the prosecutrix's initial version and the testimony of Constable Raghubir Singh. However, during the trial, the prosecutrix stated that only Karam Chand and Ashok Kumar raped her, and she escaped before Pardeep Kumar could act. This inconsistency raised doubts about Pardeep Kumar's involvement in the actual commission of rape.
4. Determination of Common Intention and Concerted Action Among Accused:
The court examined whether Pardeep Kumar's presence and actions indicated a common intention to commit rape. The prosecutrix's statement suggested that Pardeep Kumar arrived after the initial acts of rape and was consuming liquor in another room. The court noted that mere presence at the crime scene, without evidence of active participation or prior concert, is insufficient to establish common intention. The absence of specific acts or conduct attributing a shared intention to commit rape further weakened the prosecution's case against Pardeep Kumar.
Conclusion:
The court concluded that the prosecution failed to prove beyond reasonable doubt that Pardeep Kumar shared the common intention to commit rape. The inconsistencies in the prosecutrix's statements and the lack of concrete evidence of Pardeep Kumar's active involvement led to his acquittal. The conviction under Section 376 IPC was set aside, and Pardeep Kumar was granted the benefit of doubt, resulting in his release.
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2006 (8) TMI 618
Issues Involved:
1. Parameters for the grant of bail under Section 37 of the NDPS Act.
2. Worth of evidence of 'stock witnesses.'
3. Conviction under Section 21(c) of the NDPS Act based solely on the confession of the accused before an officer of the Narcotics Control Bureau.
Detailed Analysis:
Parameters for the Grant of Bail under Section 37 of the NDPS Act:
Section 37 of the NDPS Act mandates that an accused should not be released on bail unless two conditions are met: (1) the Public Prosecutor has had an opportunity to oppose the bail application, and (2) the court is satisfied that there are reasonable grounds for believing that the accused is not guilty of the offense and is not likely to commit any offense while on bail. The Supreme Court in *Customs, New Delhi v. Ahmadalieva Nodira* explained that "reasonable grounds" mean something more than prima facie grounds and require substantial probable causes for believing that the accused is not guilty. Additionally, the Supreme Court in *Ranjit Singh Brahmajeet Singh Sharma* emphasized that the restrictions on granting bail should not be pushed too far and that the court must consider the probability of the accused not being ultimately convicted based on broad probabilities rather than meticulously weighing the evidence.
Worth of Evidence of 'Stock Witnesses':
The judgment highlights that the evidence of 'stock witnesses' is essentially worthless. The improbability of the same individuals being chance witnesses to multiple crimes at different times and places casts significant doubt on their credibility. The court referred to the Supreme Court's observations in *Prem Chand (Paniwala)*, which condemned the use of such witnesses as it undermines the integrity of the judicial process. In the present case, the two witnesses, Ravi and Charan Singh, had been used repeatedly by the prosecution in different cases, making their presence and the alleged recovery suspect. The court concluded that the presence of these 'stock witnesses' and the recovery itself are doubtful, thus diminishing the credibility of the prosecution's case.
Conviction under Section 21(c) of the NDPS Act Based Solely on the Confession of the Accused:
Section 25 of the Indian Evidence Act, 1872, states that confessions made to police officers are inadmissible. However, confessions made to officers who are not classified as police officers under the NDPS Act can be admissible if they are voluntary. The Supreme Court in *Raj Kumar Karwal v. Union of India* held that officers of the NCB are not police officers within the meaning of Section 25 of the Evidence Act, making confessions to them admissible. The court in *M. Prabhulal* further held that voluntary confessions made under Section 67 of the NDPS Act could be the basis for conviction if they are credible and unimpeached. In the present case, the petitioner's confession would need to be shown as voluntary and credible to be used as the sole basis for conviction.
Conclusion:
The court, considering the arguments and the legal standards, found that the petitioner might not be ultimately convicted due to the doubtful credibility of the 'stock witnesses' and the inconsistencies in the recovery and sample descriptions. The petitioner was granted bail as the prosecution did not dispute his lack of involvement in other criminal cases, satisfying the twin conditions of Section 37 of the NDPS Act. The petitioner was directed to be released on bail upon furnishing a personal bond and surety. The court clarified that the views expressed are tentative and should not influence the trial's merits.
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2006 (8) TMI 617
Issues involved:
Interpretation of tax laws regarding addition made by the Assessing Officer under section 69 of the Income Tax Act for 'on-money' payment collected by a builder.
Analysis:
The main issue in this case revolves around whether the addition made by the Assessing Officer under section 69 of the Income Tax Act for 'on-money' payment collected by a builder should be deleted. The Tribunal considered the disclosure made by the builder regarding receiving 'on-money' from flat purchasers, totaling to Rs. 70 lakhs during the Assessment Year 1993-94. The Assessing Officer believed that since the builder received 'on-money,' it was probable that the assessee also paid 'on-money' to the builder. However, the Tribunal found that there was no concrete evidence to support this assumption. The Tribunal emphasized that additions cannot be made solely based on probabilities and ruled in favor of deleting the addition. The decision was based on the principle that findings of fact regarding the payment of 'on-money' are crucial, and in this case, both the CIT (A) and the Tribunal found no grounds for interference. As a result, the appeal was dismissed at the admission stage, with no substantial question of law arising.
In conclusion, the judgment highlights the importance of concrete evidence in tax assessments and emphasizes that additions cannot be made solely on probabilities. The decision underscores the significance of factual findings in determining tax liabilities and the need for a strong legal basis for any additions made by the Assessing Officer under the Income Tax Act.
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2006 (8) TMI 616
Issues involved: Appeal against dropping of demands of service tax on "Goods Transport Operators Service" and "Clearing & Forwarding Agents Service" for specific periods.
Service Tax on Goods Transport Operators Service: The department appealed against the dropping of service tax demands on Goods Transport Operators Service for a certain period. The tax amount was paid within the prescribed time limit under Rule 7A of the Service Tax Rules, 1994, based on self-assessment done in the tax returns filed with "UNDER PROTEST" endorsement. The respondents also submitted a letter raising legal contentions and registering their protest without prejudice to their right to contest the demand or claim refunds in the future.
Service Tax on Clearing & Forwarding Agents Service: The department contested the dropping of service tax demands on Clearing & Forwarding Agents Service for a specific period. The respondents' self-assessed tax payments were deemed non-refundable based on the Supreme Court's judgment in Gujarat Ambuja Cements Ltd. v. UOI, which upheld the constitutional validity of retrospective amendments to the Finance Act, 1994. The respondents' attempt to rely on the decision in Commissioner v. L.H. Sugar Factories Ltd. was deemed invalid, as the returns filed under protest and tax payments made were considered voluntary actions under the law.
Decision: The Tribunal disagreed with the respondents' submissions, citing similar cases where self-assessed duty paid was held non-refundable. The Tribunal found that the returns filed under protest, assessments made under protest, and tax payments were voluntary actions, thus invalidating the protest. The Commissioner's order, based on the earlier judgment in L.H. Sugar Factories case and not considering the Gujarat Ambuja Cements judgment, was set aside, and the appeal was allowed.
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2006 (8) TMI 615
Issues:
1. Applicability of Service Tax on railway siding charges collected by railways on behalf of the appellants.
2. Correctness of demands raised by Revenue on the appellants.
3. Whether amounts not received from railways can be considered taxable.
4. Liability of railways to pay the tax on railway siding charges.
Analysis:
1. The appellants were required to pre-deposit Service Tax and penalty for utilizing port services and authorizing railways to collect railway siding charges. The Revenue added these charges to the assessable value, leading to demands. The appellants contended that they had already discharged Service Tax on these charges. The Tribunal found that until the amounts were received by the appellants, they should not be taxed. Additionally, the legal contention that railways, as the collectors of the charges, should be liable to pay the tax was deemed to have merit.
2. After hearing both sides, the Tribunal considered whether the approvals shown in the balance sheet were subject to Service Tax and if the railway siding charges constituted a taxable service. Since the appellants had not actually received these amounts, the Tribunal concluded that taxing them prematurely was inappropriate. Moreover, the argument that the railways, as the entities collecting the charges, should bear the tax liability was found to have legal merit.
3. The Tribunal acknowledged that the demands raised by the Revenue were based on accrual amounts, i.e., those not yet received from the railways. It was determined that such amounts should not be considered taxable until actually received by the appellants. The Tribunal granted a waiver of pre-deposit and stayed the recovery of the demanded amounts until the appeal was disposed of, recognizing the legal validity of the argument that the railways, as the collectors of the charges, should be responsible for paying the tax.
4. In conclusion, the Tribunal allowed the stay application, waiving the pre-deposit requirement and halting the recovery of the demanded amounts until the appeal was finalized. The legal contention that the railways, as the entities collecting the railway siding charges, should bear the tax liability was upheld, indicating the merit in this argument and the need for further consideration during the appeal process.
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2006 (8) TMI 614
Issues:
Delay in filing appeal, Condonation of delay, Knowledge of order date, Refund claim, Verification of dispatch of order, Merit of application for condonation of delay
Delay in filing appeal:
The appeal was filed by the Revenue against an order passed by the Customs, Excise and Service Tax Appellate Tribunal. The appellant filed an application under Section 5 of the Limitation Act seeking condonation of delay in filing the appeal. The application stated a delay of about three months and seven days, attributing the delay to the appellant coming to know about the Tribunal's decision only on 23rd July, 2004. However, the respondent contended that the appellant should have been aware of the order since the refund claim was made on 8th June, 2004, along with all necessary documents and orders. The appellant also made reference to another appeal filed in January 2005, numbered as Customs Case 1/2004, which seemed contradictory. Despite the appellant's claim of delayed knowledge, the Tribunal's Registrar confirmed dispatching the order to the appellant in September 2003, indicating that the appellant should have received the order by October 2003.
Condonation of delay:
The High Court scrutinized the circumstances surrounding the delay in filing the appeal and the appellant's claim of late knowledge of the Tribunal's decision. The Court noted that despite opportunities to provide evidence that the appellant did not receive the order promptly, no such proof was presented. The Court found the appellant's explanation unsatisfactory and concluded that the appellant did not present accurate facts or justify the delay of about one and a half years in filing the appeal. As a result, the Court dismissed the application for condonation of delay.
Knowledge of order date:
The conflicting claims regarding the date when the appellant became aware of the Tribunal's order were examined by the Court. While the appellant stated knowing about the decision only in July 2004, the respondent argued that the appellant should have been informed in June 2004 when the refund claim was submitted. The Court, based on the Registrar's confirmation of dispatching the order in September 2003, rejected the appellant's claim of late knowledge in July 2004 and deemed it inaccurate.
Refund claim:
It was highlighted that the respondent had already received the refunded amount in 2004 itself, before the appeal was filed in May 2005. This fact was considered in the context of the appellant's delay in filing the appeal and the subsequent dismissal of the application for condonation of delay.
Verification of dispatch of order:
The Registrar of the Tribunal's confirmation of dispatching the order to the appellant and the respondent in September 2003 was a crucial aspect considered by the Court. The Registrar's letter detailed the dispatch dates and provided photocopies of relevant pages from the dispatch register, indicating that the appellant should have received the order by October 2003. This verification played a significant role in determining the appellant's claimed knowledge date and the subsequent dismissal of the appeal.
Merit of application for condonation of delay:
After analyzing the circumstances, including the verification of order dispatch and the appellant's failure to provide evidence of non-receipt, the Court found no merit in the application for condonation of delay. The Court emphasized that the appellant did not present accurate information or a valid explanation for the delay, leading to the dismissal of both the application and the appeal.
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2006 (8) TMI 613
Issues Involved:
1. Non-filing of the audit report along with the return under section 80-IB.
2. Non-examination of the stock register by the Assessing Officer.
3. Non-transfer of share premium to the "Securities Payment Premium Account" as per section 78 of the Companies Act.
4. Direction by the CIT to the Assessing Officer to examine other issues during reassessment.
Issue-wise Detailed Analysis:
1. Non-filing of the Audit Report Along with the Return Under Section 80-IB:
The primary issue was whether the assessee's claim for exemption under section 80-IB was valid despite the audit report not being filed along with the return. The assessee argued that the audit report, although filed a day after the return, was within the prescribed time under section 139(1) and should be considered part of the return. The Tribunal noted that the assessment records and the proposal for scrutiny did not mention the absence of the audit report, indicating it was likely available to the Assessing Officer. The Tribunal concluded that the audit report was indeed filed on 28-11-2003 and that the Assessing Officer had examined it before allowing the claim, thus complying with section 80-IA(7). The Tribunal held that the non-attachment of the audit report with the return did not render the assessment order erroneous or prejudicial to the interests of revenue.
2. Non-examination of the Stock Register by the Assessing Officer:
The CIT found the assessment order erroneous due to the non-production of the stock register before the auditors and the Assessing Officer. However, the Tribunal found that the stock register was produced during the assessment proceedings, as evidenced by the order sheet entries and the detailed queries made by the Assessing Officer regarding the stock. The Tribunal concluded that the stock register was examined, and the non-production before the auditors did not affect the assessment's validity. Hence, the assessment order was not erroneous or prejudicial to the interests of revenue on this ground.
3. Non-transfer of Share Premium to the "Securities Payment Premium Account" as per Section 78 of the Companies Act:
The CIT held the assessment order erroneous due to the failure to transfer the share premium to the "Securities Payment Premium Account." The assessee argued that this non-compliance did not impact the computation of taxable income under the Income-tax Act. The Tribunal agreed, stating that the classification of share premium under the Companies Act did not affect the income computation under the Income-tax Act. Therefore, the assessment order could not be revised on this ground.
4. Direction by the CIT to the Assessing Officer to Examine Other Issues During Reassessment:
The CIT's order directed the Assessing Officer to examine other issues during reassessment, which was beyond the scope of the notice under section 263. The Tribunal held that the CIT could not widen the scope of reassessment beyond the issues specified in the notice. This transgression rendered the CIT's order invalid.
Conclusion:
The Tribunal quashed the CIT's order under section 263, holding that the assessment order dated 28-3-2005 was not erroneous or prejudicial to the interests of revenue on any of the grounds specified. The Tribunal emphasized that the CIT's directions exceeded the scope of the notice under section 263, rendering the order invalid. The appeal was allowed in favor of the assessee.
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2006 (8) TMI 612
Applicability of "Section 44C or 37(1)" - In respect of head office expenditure - HELD THAT:- In the absence of the original file showing that the revenue did not file any appeal by taking a conscious decision against the decision of the Calcutta High Court in the case of Rupenjuli Tea Co. Ltd.(supra), we assume that the revenue had accepted the ratio of the aforesaid case in Rupenjuli Tea Co. Ltd.(supra) and accordingly answer the question regarding the applicability of Section 44C of the Act against the revenue and in favour of the assessee.
Learned counsel appearing for the revenue does not challenge that in the absence of applicability of Section 44C of the Act, Section 37(1) would apply. Accordingly, we answer question No.2 as well against the revenue and in favour of the assessee regarding the applicability of Section 44C of the Act as well as allow the HO expenditure u/s 37(1) of the Act.
The Appeals are dismissed accordingly.
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2006 (8) TMI 611
Application filled before the Forest Tribunal u/s 8 of the Kerala Private Forests (Vesting and Assignment) Act, 1971 ("the Act") - seeking a declaration that the application scheduled property was not a private forest liable to be vested in the Government - claimed exemption u/s 3(2) - High Court exercise its jurisdiction invoking Article 215 of the Constitution of India - Whether the view of the Forest Tribunal that it could not review the order in exercise of power u/s 8B of the Act, notwithstanding the dismissal of the appeal from its decision at the stage of admission, need not be considered at this stage - HELD THTA:- It was not a case of the appellant merely putting forward a false claim or obtaining a judgment based on perjured evidence. This was a case where on a fundamental fact of entitlement to relief, he had deliberately misled the Court by suppressing vital information and putting forward a false claim, false to his knowledge, and a claim which he knew had no basis either in fact or on law. It is therefore clear that the order of the Forest Tribunal was procured by the appellant by playing a fraud and the said order is vitiated by fraud. The fact that the High Court on the earlier occasion declined to interfere either on the ground of delay in approaching it or on the ground that a Second Review was not maintainable, cannot deter a Court moved in that behalf from declaring the earlier order as vitiated by fraud.
The High Court, as a court of record, has exercised its jurisdiction to set at naught the order of the Forest Tribunal thus procured by the appellant by finding that the same is vitiated by fraud. There cannot be any doubt that the court in exercise of its jurisdiction under Article 215 of the Constitution of India has the power to undo a decision that has been obtained by playing a fraud on the court. The appellant has invoked our jurisdiction under Article 136 of the Constitution of India. When we find in agreement with the High Court that the order secured by him is vitiated by fraud, it is obvious that this Court should decline to come to his aid by refusing the exercise of its discretionary jurisdiction under Article 136 of the Constitution of India.
The plea that the second review was not maintainable, that the Division Bench could not have ignored the earlier orders of the High Court dismissing the appeal at the stage of admission and the dismissing of the petition for condonation of delay in filing the first review, are all of no avail to the appellant. In this case, the Forest Tribunal had also been moved by way of review and that tribunal refused to exercise its jurisdiction u/s 8B of the Act and nothing stands in the way of the High Court setting aside that order on a finding that the original order from the Forest Tribunal was secured by playing a fraud on the Tribunal.
Equally, nothing stood in the way of the High Court reviewing the judgment in O.P. in which a mandamus was issued by the High Court to restore possession of the application schedule property to the appellant. Similarly, nothing stood in the way of the High Court in allowing O.P. filed by a body of citizens challenging the restoration of 20 acres of virgin forest to the appellant in presumed enforcement of the order in O.A. and passing the necessary order nullifying the original order.
The fact that the High Court has chosen to review the earlier order on the petition for condonation of delay in filing the first review petition and then to exercise the power of review cannot be of any moment in the light of the what we have stated. In any event, as we have indicated, this is a fit case where we should clearly decline to exercise our jurisdiction under Article 136 of the Constitution of India to come to the aid of the appellant to secure to him the fruits of the fraud practiced by him on the Forest Tribunal and the High Court. Thus, we find no merit in the argument that the High Court had exceeded its jurisdiction in setting aside the order of the Forest Tribunal at this distance of time.
We thus confirm the decision of the High Court and dismiss these appeals with costs. We hope that this judgment will act as an eye opener to the Forest Tribunals and the High Court exercising appellate jurisdiction in dealing with claims, (obviously now they are belated claims) for exemption or exclusion u/s 8 of the Act. It behoves the Forest Tribunals and the appellate court to carefully scrutinise the case of title and possession put forward by claimants as also the identities of the lands sought to be claimed, while entertaining applications u/s 8 of the Act.
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2006 (8) TMI 610
Issues involved: Interpretation of section 32(1) of the Income-tax Act, 1961 regarding claim for depreciation and imposition of penalty u/s 271(1)(c) based on difference of opinion between assessee and Assessing Officer.
Interpretation of Section 32(1) - Claim for Depreciation:
The case involved a company engaged in manufacturing chemicals which declared a loss and claimed depreciation of Rs. 32,83,710 for the relevant year. The Assessing Officer disallowed the depreciation claim citing lack of manufacturing activity. The Commissioner of Income-tax (Appeals) upheld this decision, which the assessee accepted without further appeal. However, penalty proceedings u/s 271(1)(c) were initiated later, contending a difference of opinion on the depreciation claim. The Tribunal, under section 260A of the Act, accepted the assessee's contention that it intended to resume manufacturing activities despite lack of firm orders, leading to the conclusion that the assessee was entitled to depreciation.
Imposition of Penalty u/s 271(1)(c) - Difference of Opinion:
The Tribunal considered the correspondence where the assessee expressed willingness to supply chemicals against specific orders, indicating intent to revive manufacturing activities. Additionally, the Tribunal noted the company's financial constraints preventing production resumption, despite steps taken by management. Referring to Capital Bus Service (P.) Ltd. v. CIT [1980] 123 ITR 4041, the Tribunal adopted a liberal interpretation of the term "used" in section 32(1) of the Income-tax Act, suggesting that the assessee had machinery ready for use but lacked firm commitments. The Tribunal held that the revenue failed to establish a case for penalty under section 271(1)(c) as the assessee raised a plausible argument regarding the depreciation claim.
Conclusion:
The High Court dismissed the appeal, stating that no substantial question of law arose for consideration. The Tribunal's decision to not impose penalty under section 271(1)(c) was upheld, emphasizing the lack of grounds for penalty proceedings based on the difference of opinion between the assessee and the Assessing Officer.
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2006 (8) TMI 608
Whether the investigating agency had not obtained previous sanction of the Central Government or of the State Government or of the District Magistrate as required by Section 196(1-A) Cr.P.C., the initiation of criminal proceedings against the respondent is bad in law and consequently it was liable to be quashed?
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2006 (8) TMI 607
Determination of rate of profit - work of civil construction in Public Works Department - rejected books of account - exceeds turnover - whether the assessee was entitled to the benefit of section 40(b)( iv) and (v) - salary and interest paid to the partners - HELD THAT:- In no case, simply because the turnover is more than ₹ 40 lakhs or the assessee is performing civil construction work for Public Works Department, neither the rate of profit could be determined nor it could be taken to be less nor it could be reduced nor could be arrived at on presumptions.
Since the Assessing Officer as well as the CIT(A) as also the ITAT has not recorded any finding based on any material, and the findings recorded are merely on surmises and conjectures or, so to say, on purely guess work and imagination of the authorities, as it has not been brought to our notice that any such rate of profit can be assessed under the rules or any law in this manner, the findings of rate of profit, therefore, cannot be sustained and are liable to be set aside, and the matter deserves to be remanded to the assessing authority for re-determination thereof.
It was the specific case that these partners were working partners and they were entitled to salary and interest, as per terms of the deed in accordance with section 40(b) of the Act. In the absence of any material having brought by the revenue in rebuttal and more so when no such plea was ever taken or raised in the appeal, as also no substantial question of law has been framed in this regard, the aforesaid plea is bound to fail.
Even before the Tribunal, it appears that no such question was raised. We have been informed by the learned counsel for the parties that for the last two assessment years, the Assessing Officer himself has granted deductions treating the firm to be entitled for the same.
Thus, we allow the appeals in part and remit the matter to the Assessing Officer for only recording findings on question (1) referred to above, namely, to determine the rate of profit on the basis of the evidence/material on record, after affording opportunity of hearing and also giving opportunity to the parties to lead such evidence, as may be necessary, in the light of the observations. The findings regarding availability of deductions u/s 40(b)( iv) and (v) stand concluded and this question shall not be opened by the Assessing Officer.
All the appeals are disposed of accordingly.
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2006 (8) TMI 606
Issues Involved:
1. Alleged delay and interference in judicial process.
2. Appointment of a new prosecutor.
3. Alleged irregularities in Income Tax Appellate Tribunal (ITAT) cases.
4. Appointment of the Special Judge.
5. Prayer for re-engagement of the earlier prosecutor.
6. Prayer for Writ of Mandamus directing appeals against ITAT orders.
7. Prayer for cancellation of bail of respondents 4 and 5.
Detailed Analysis:
1. Alleged Delay and Interference in Judicial Process:
The petitioners, former Members of Parliament, filed writ petitions alleging large-scale defalcation of public funds in Bihar's Department of Animal Husbandry. They claimed that after a change in the central government, attempts were made to delay and interfere with judicial processes, including the removal of public prosecutors to benefit respondents 4 and 5, former Chief Ministers of Bihar. The court found no substantial evidence supporting these allegations.
2. Appointment of a New Prosecutor:
The petitioners alleged that the Director of CBI changed the prosecutor at the final stage of the trial to help the accused. The court noted that the earlier prosecutor, Shri L.R. Ansari, had completed examining witnesses and arguments, and his reassignment was due to other responsibilities. The new prosecutor, Shri Oma Shankar Sharma, had significant experience. The court found no evidence of undue influence or interference by respondents 4 and 5 in the appointment of the new prosecutor.
3. Alleged Irregularities in ITAT Cases:
The petitioners claimed that respondent nos. 4 and 5 influenced the transfer of ITAT member Shri D.K. Tyagi and expedited favorable decisions by appointing Shri Mohanarajan, who was nearing retirement. The court reviewed the President of ITAT's report and found that Tyagi's transfer was due to personal reasons and disciplinary issues, not undue influence. The court also noted that the decisions not to appeal ITAT orders were based on legal opinions from the Central Board of Direct Taxes and Ministry of Law, finding no procedural irregularities or undue influence.
4. Appointment of the Special Judge:
The petitioners alleged that the appointment of Shri Muni Lal Paswan as the Special Judge was irregular and intended to benefit respondents 4 and 5. The court reviewed the records and found that the Standing Committee of the Patna High Court, consisting of senior judges, had validly appointed Paswan. The court found no evidence of poor record or procedural irregularities in his appointment.
5. Prayer for Re-engagement of the Earlier Prosecutor:
The petitioners requested the re-engagement of the earlier prosecutor, Shri Ansari. The court noted that Ansari had already been reassigned to other cases and found no necessity for his re-engagement. However, the CBI was given liberty to utilize his services if needed.
6. Prayer for Writ of Mandamus Directing Appeals Against ITAT Orders:
The petitioners sought a Writ of Mandamus directing the authorities to file appeals against ITAT orders favoring respondents 4 and 5. The court held that a third party cannot seek such remedies in collateral proceedings and found no evidence of procedural irregularities or undue influence in the decision not to appeal. Hence, the prayer for Writ of Mandamus was rejected.
7. Prayer for Cancellation of Bail of Respondents 4 and 5:
The petitioners requested the cancellation of bail granted to respondents 4 and 5, alleging interference in the judicial process. The court found no evidence that the respondents misused their bail privileges or were likely to flee from justice. Therefore, the prayer for cancellation of bail was denied.
Conclusion:
The Supreme Court dismissed the writ petitions, finding no merit in the allegations of judicial interference, irregularities in ITAT proceedings, improper appointment of the Special Judge, or misuse of bail by respondents 4 and 5. All interim orders were vacated.
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2006 (8) TMI 605
Issues Involved:
1. Delay in passing the order of detention.
2. Non-application of mind by the detaining authority.
3. Supply of documents in a language not understood by the detenu.
Issue-Wise Detailed Analysis:
1. Delay in Passing the Order of Detention:
The petitioner argued that there was an inordinate delay in passing the detention order, which resulted in snapping the live link between the acts complained of and the order of detention. The detenu's prejudicial activities were noticed in March 2005, but the order was passed 10 months later, on January 27, 2006. The detaining authority explained that the processing of the proposal was a continuous process, involving multiple steps and the examination of voluminous documents. The proposal was first approved by the Screening Committee on June 14, 2005, and received by the detaining authority on July 7, 2005. Additional documents and representations were received and considered at various stages, leading to the finalization of the order in January 2006. The Court was satisfied that there was no undue delay and that the matter was processed continuously and diligently, considering the voluminous material involved.
2. Non-application of Mind by the Detaining Authority:
The petitioner contended that the detaining authority, who took charge on January 10, 2006, could not have considered all the material within the short span of 12 working days before issuing the detention order on January 27, 2006. The detaining authority countered this by stating that she had considered all relevant material and reached the requisite subjective satisfaction before issuing the order. The Court noted that the process of issuing the detention order was continuous and involved multiple levels of scrutiny and approval. The detaining authority had indeed applied her mind to the material and independently reached the subjective satisfaction necessary for issuing the order. The Court rejected the argument that the order was issued in haste or without application of mind.
3. Supply of Documents in a Language Not Understood by the Detenu:
The petitioner claimed that the detenu did not understand English, and the documents were not provided in a language he understood, breaching Article 22(5) of the Constitution. The detenu had signed the documents in English and later requested translations in Marathi. The translated documents were provided within 10 days. The Court found ample evidence that the detenu was conversant with English, as he had corresponded with authorities in English and signed documents in English. The Court concluded that the service of documents in English did not breach Article 22(5), and the subsequent provision of translated documents further supported this conclusion.
Conclusion:
The Court found no merit in the contentions regarding delay, non-application of mind, and the language of the documents. The writ petition was dismissed as devoid of merit. The Court also noted that the issue of delay in the disposal of the representation was not raised in the writ petition and could be challenged separately if advised.
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2006 (8) TMI 604
Issues:
1. Eligibility for exemption under Notification No.5/98-CE.
2. Interpretation of Condition No.10 of the Notification regarding availing credit of duty.
3. Effect of availing MODVAT credit on exempted and other goods.
4. Claim for MODVAT credit and re-computation of duty liability.
5. Treatment of sale price as cum-duty price for duty determination.
6. Imposition of penalty.
Issue 1: The dispute revolves around the eligibility of the appellant for exemption under Notification No.5/98-CE for goods classified under heading 39.23.90. The Tribunal remanded the case back for a fresh decision as no clear finding was recorded on whether the appellant met the conditions for exemption.
Issue 2: The interpretation of Condition No.10 of the Notification is crucial in determining the eligibility for exemption. The contention between the parties lies in whether the bar on availing credit of duty extends to all goods produced in the same factory or only to the specific products mentioned in column (2) of the notification.
Issue 3: The appellant availed MODVAT credit on inputs for both exempted and other goods manufactured in the same factory. The appellant argued that taking input credit on other products does not violate the condition, while the revenue contended that such availing of credit renders the appellant ineligible for the exemption.
Issue 4: The appellant sought a re-computation of duty liability after claiming MODVAT credit in accordance with the MODVAT Rules. The Tribunal directed the jurisdictional authority to determine the duty payable after allowing eligible MODVAT credit based on relevant records.
Issue 5: Regarding the treatment of sale price as cum-duty price for duty determination, the Tribunal directed the original authority to re-compute the duty based on settled legal principles established by the Supreme Court in previous cases.
Issue 6: The imposition of a penalty was contested by the appellant, arguing that there was no suppression or mis-declaration of facts to warrant penalty under Section 11A. The Tribunal agreed that the dispute was purely legal, and hence, set aside the penalty imposed in the impugned orders.
In conclusion, the Tribunal remanded the case for a fresh decision on the eligibility for exemption under Notification No.5/98-CE, emphasizing the interpretation of Condition No.10 regarding the availing of credit of duty. The appellant's claims for MODVAT credit, re-computation of duty liability, treatment of sale price, and the penalty imposition were addressed in detail, resulting in the orders being set aside or directed for further action in accordance with the law.
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2006 (8) TMI 603
Issues:
Petitioner claiming apparent mistake in tribunal's order, Company being clubbed with firms for clearance value, Circular No.6/92 not considered, Petitioner seeking withdrawal to file Misc. Application before Tribunal.
Analysis:
The petitioner contended that there was an apparent mistake in the tribunal's order post the main appeal decision. The petitioner cited the decision of the Hon'ble Supreme Court in a specific case and a circular from 1992 to support their claim. They highlighted that despite the circular stating that a Company cannot be clubbed with other units for exemption limit purposes, the original order had erroneously done so. This crucial aspect was allegedly overlooked in the impugned order issued during the Review Petition.
The court advised the petitioner that if indeed there was an apparent mistake in the tribunal's order, the appropriate course of action would be to approach the Tribunal directly. The petitioner was granted liberty to withdraw the petition with the option to file a Miscellaneous Application before the Tribunal. It was emphasized that any such application should address the issue directly covered by the Supreme Court's decision and the alleged mistake in the tribunal's order.
Ultimately, the court disposed of the petitions as per the petitioner's request for withdrawal, allowing them the opportunity to pursue corrective action through the Tribunal. The order instructed the registry to circulate a copy of the judgment in all related matters, ensuring transparency and consistency in the legal proceedings.
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2006 (8) TMI 602
Issues Involved:
1. Whether the transactions between the dealer and IIT Kanpur and Hindustan Aeronautics Limited constituted a "transfer of right to use" the vehicles under Section 3-F of the U.P. Trade Tax Act.
2. Examination of the terms and conditions of the agreements to determine the control and possession of the vehicles.
3. Analysis of relevant case law to interpret "transfer of right to use."
Issue-Wise Detailed Analysis:
1. Whether the transactions constituted a "transfer of right to use" the vehicles under Section 3-F of the U.P. Trade Tax Act:
The revision under Section 11 of the U.P. Trade Tax Act challenges the Tribunal's order regarding the assessment year 1990-1991. The Assessing Authority had levied tax on the amount received by the dealer under Section 3-F, treating the transactions as a transfer of rights to use the goods. The Tribunal, however, rejected the appeal, holding that the dealer provided vehicles for transportation while retaining possession, thus not constituting a transfer of right to use.
2. Examination of the terms and conditions of the agreements:
The agreements with IIT Kanpur and Hindustan Aeronautics Limited were scrutinized. The dealer provided buses for transportation, bearing all expenses and responsibilities, including fuel, maintenance, insurance, and wages. The control and superintendence of the vehicles remained with the dealer, as specified in the agreements. For instance, Clause 15 of the IIT Kanpur agreement stated that the plying of the bus was under the institute's control, yet the dealer's personnel had to follow the institute's directions. Similarly, the Hindustan Aeronautics Limited agreement required the dealer to provide buses and bear all associated costs, with the company having no responsibility for accidents or damages.
3. Analysis of relevant case law:
The court referred to several precedents to interpret the "transfer of right to use":
- Kando Transport v. S.T.O. Assessment Unit, Barbil: The Orissa High Court held that if the control, custody, and possession of the vehicle remain with the owner, there is no transfer of the right to use.
- Rashtriya Ispat Nigam Ltd. v. Commercial Tax Officer: The Andhra Pradesh High Court concluded that effective control of machinery by the owner, even while used by the contractor, does not constitute a transfer of the right to use.
- M/s Ahuja Goods Agency v. State of U.P.: The Division Bench held that without the transfer of possession, there is no transfer of the right to use.
- Bharat Sanchar Nigam Ltd. v. Union of India: The Supreme Court emphasized that the essence of the right to use goods involves the user of goods, and delivery of possession is essential.
Conclusion:
The court concluded that the effective control over the vehicles remained with the dealer, and there was no transfer of right to use under Section 3-F of the Act. The agreements indicated that the dealer bore all operational responsibilities and risks, maintaining control over the vehicles. Therefore, the transactions did not constitute a transfer of right to use, and the tax levied under Section 3-F was not applicable. The revision was dismissed, affirming the Tribunal's decision.
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2006 (8) TMI 601
Whether in terms of the proviso appended to Rule 16 (2A), the State of Assam could not have accepted the offer of voluntary retirement?
Whether the offer of the appellant to retire voluntarily could have been accepted only prior to 1.8.1997 in terms of the circulars issued by the Central Government, as the employee has a right to withdraw the offer even after acceptance by the State Government?
Whether the respondents being public authorities, were bound to follow the Rules laid down by the Central Government which alone could have applied its mind to the request of the appellant and not the State of Assam?
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