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Showing 41 to 60 of 157 Records
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1979 (9) TMI 150
Oppression and mismanagement – Power of Tribunal on application under sections 397 and 398 ... ... ... ... ..... d of fixed time the day on which the act or event occurs is excluded. Therefore, in agreement with the learned company judge, I am of the view that the application has been filed within time. Indeed, Mr. Ghosh has conceded that if 24th of May, 1974, the date of the execution of the sale deed is excluded in computing the period within three months , then the application is in time. Some argument was also advanced at the Bar that in view of section 29 of the Indian Limitation Act, section 12(1) of the aforesaid Act would also apply to the instant case. However, in the view that I have taken, it is not necessary to decide the question and, as at present advised, I would not express any opinion on this aspect of the matter, namely, whether the provisions of section 12 of the Indian Limitation Act apply to the company law. In the result, there is no merit in this appeal and it is, accordingly, dismissed. I would make no order as to costs. Shiveshwar Prasad Sinha, J. mdash I agree.
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1979 (9) TMI 149
Compromise and arrangements ... ... ... ... ..... is confirmed subject, however, to the payment by the auction-purchaser of 10 of the sale price and I would direct accordingly. The additional amount would be deposited by the auction-purchaser within two weeks. On the aforesaid amount being deposited, the auction-purchaser would be entitled to the sale certificate, as indeed vacant possession of the property. The auction-purchaser would, however, be entitled to opt out of the transaction in which case the sale would be treated as null and void and the auction-purchaser would be entitled to the refund of the amount deposited by him along with 5 of the amount by way of solatium. In the event of a fresh auction the auction-purchaser would be entitled to make a bid subject to the condition that in case he was declared to be the highest bidder, the amount of solatium would be refunded on the sale being confirmed. CAs. No. section 275 and 284 of 1979 are disposed of in these terms leaving the parties to bear their respective costs.
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1979 (9) TMI 133
Whether on proper construction of the agreement dated November 10, 1955, entered into by the assessee with Kamala Mills Ltd., the latter was the "manager" of the assessee within the meaning of section 384 read with section 2(24) of the Companies Act, 1956, and if so whether the remuneration paid by the assessee to the latter in the two calendar years 1957 and 1958 relevant to the assessment years 1958-59 and 1959-60 cannot be allowed as business expenditure under section 10(2)(xv) of the Indian I.T. Act, 1922 ?
Held that:- Appeal dismissed. The High Court was right in answering the question in favour of the assessee.
The aspects whether the assessee had disputed its liability to pay such remuneration to Kamala Mills Ltd. or had filed a suit at the instance of the Company Law Board to recover it back from Kamala Mills Ltd. or had obtained a decree in that behalf against Kamala Mills Ltd. become irrelevant. However, we would like to place on record the fact that the decree obtained by the assessee against Kamala Mills Ltd, has been reversed or set aside in appeal by the Kerala High Court—a fact which was brought to our notice by the Advocate-on-Record for the assessee communicated to him by his client in a letter dated 22nd August, 1979. However, even if in further appeal the trial court's decree was restored and the assessee were to recover back the remuneration, the assessee can be taxed on the two amounts under section 41(1) of the 1961 Act.
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1979 (9) TMI 124
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... ... ..... e power to allow the assessee to put forward a new claim, notwithstanding the fact that such a claim was not raised by him before the ITO or the AAC, provided there is sufficient material on record to allow such a claim. 10. In the present case we find from the assessment order in the asst. yr. 1974-75 that extra shift allowance was allowed to the assessee and so it cannot be doubted that it must have been carried forward. The assessee has also claimed that extra shift allowance was allowed even in the yr. 1976-77. Thus the materials were before the ITO and as the ITO did not allow the claim, the ACC directed the ITO to obtain the details of plant and machineries owned by the assessee which worked for extra shift and to allow extra shift allowance in accordance with law. We find under such circumstances the ACC has taken a reasonable view in the matter and so we uphold the order of the ACC. 11. In the result, the appeal is dismissed and the cross objection is allowed in part.
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1979 (9) TMI 123
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... ... ..... owance of Rs. 6,000. 5. The next ground of the assessee is to the effect that the AAC erred in not allowing relief under s. 80J on the borrowed capital. The AAC relied on the decision of the Andhra Pradesh High Court in CIT vs. Warner Hindustan Ltd. (1) for holding that the borrowed capital has to be excluded in computing the capital employed by the assessee under s. 80J of the said Act. The ld. deptl. representative has relied on the ruling reported in 117 ITR 68 whereas the ld. Counsel for the assessee has relied on the rulings reported in Century Enka Ltd. Vs. ITO(2) and Madras Industrial Lining Ltd. vs. ITO(3). Both these rulings have laid down that borrowed capital should be taken into computation. We, therefore, direct the ITO that the borrowed capital has also to be taken into consideration for allowing relief under s. 80J of the said Act. 6. No other grounds have been taken in the grounds of appeal or pressed before us. 7. In the result, the appeal is allowed in full.
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1979 (9) TMI 120
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... ... ..... turn out of time and, therefore, the assessee had a reasonable cause of belated filing of return. Shri Modi s submission was that penalty should not be levied. 4. The ld. Deptl. Representative relied on the orders of the authorities below. 5. We have given due consideration to the rival submissions and we hold that because the Amendment of s. 5(1) of the Finance Act of 1970, the assessee was under a bona-fide impression that his income being under the non-taxable limit the assessee did not file the return. However, on receipt of the show cause notice the assessee naturally took time to work out what was his net wealth and then filed the return, and therefore, if there is any delay, it can be held that there was a reasonable cause as there was mis-understanding created in the mind of the assessee because of the Amendment. We hold that there was a reasonable cause and, therefore, there is not justification for levy of penalty. 6. In the result, the assessee s appeal is allowed.
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1979 (9) TMI 119
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... ... ..... y we accept Shri Modi s contention that the lower authorities erred in holding that the expenditure of Rs. 9,951 is of a capital nature. We hereby delete the same. 15. Regarding the disallowance of 1/3rd of driver s salary i.e., Rs. 556, Shri Modi did not advance any arguments except stating that the car was used for the assessee s business and, therefore, it should be allowed in full. However, Shri Modi did not produce before us a log-book, if any, maintained by the assessee. In absence of any material, we hold that it is relevant that the car might have been used for personal use of the partners. Therefore, the orders of the authorities below on that point need not be interfered with. 16. We have already expressed our opinion that disallowance of Rs. 796 out of Rs. 2,596 incurred by the assessee on tea and pan is unwarranted, having regard to the decisions mentioned earlier. 17. In the result, the assessee s appeal is partly allowed and the departmental appeal is dismissed.
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1979 (9) TMI 115
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... ... ..... shall first determine that net wealth of the firm including in it the net value of the exempted assets (i.e., after setting off the secured liability against the value of the exempted assets on which such debts are secured). He shall then allocate the net wealth of the firm among the partners in accordance with the r. 2. When allocating the share of each partner, he shall also indicate the nature of the assets and liabilities allotted to the share of a particular partner. He shall then compute the net wealth of the assessee partner by taking into account all his assets and liabilities including the share allotted to him as provided in s. 2(m). Thereafter he shall give deductions in respect of the assets exempted under s. 5 to the extent to which the assessee is entitled to such exemption. The balance will be the taxable net wealth of the assessee on which the WT will be imposed. We direct the WTO to read the assessment accordingly. 16. The appeal shall be treated as allowed.
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1979 (9) TMI 113
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... ... ..... arriages as one unit. This position is strengthened by the fact that a stage carriage without its permit is of no consequence as a commercial asset. A stage carriage and its permit are closely inter-twined and it cannot be used in the business unless the stage carriages has a valid permit. Therefore, we come to the conclusion that the disputed amount of the unexpired permit must be taken together with the value of the stage carriages as part of that capital asset. Consequently, the assessee would be entitled to depreciation on the value of the stage carriages including the value of the permit attached to them. In this view, we are of the opinion, that the deduction available to the assessee has to be recomputed. We, therefore, set aside the orders of the authorities below on this point only and restore the matter to the ITO to recompute the total income accordingly after allowing the admissible depreciation as held about. 11. In the result, the appeals are treated as allowed.
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1979 (9) TMI 112
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... ... ..... has not shown that such payment is excessive having regard to the legitimate business needs of the company or with reference to any comparable case nor any authority has been brought to our notice in support of the Department s contention. We may here refer to the decision of the Supreme Court in the case of CIT vs. Edward Keventer Pvt. Ltd. 1978 CTR SC 164 (1978) 115 ITR 149 SC in which the Supreme Court had considered the scope of the provisions of s. 10(4A) of the Indian IT Act, 1922 which corresponds to s. 40(c) under present consideration. The Supreme Court affirmed the High Court decision holding that there is nothing to show that the payment of commission was excessive or unreasonable. The same position applies in the present case also. The ratio of the Calcutta High Court decision in 118 ITR 752 also supports the assessee s case. In view of the above we are of the opinion that no interference in the AAC s order is called for. 5. In the result, the appeal is dismissed.
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1979 (9) TMI 111
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... ... ..... ppeal, s. 2(1) defines agricultural income to mean any rent or revenue derived from land which is situated in India and used for agricultural purposes. The rent received by the assessee by leasing out of the tea gardens comes clearly within this definition. Since a lease can be made only by contract, the rent received cannot cease to be rent derived from agricultural land merely because it is paid under a contract of lease. However, since the lease included the lease of factory and other items apart from the agricultural land, the question of ascertaining the agricultural income which is exempt from income-tax survives. That question was decided by the AAC by applying the formula adopted in r.8. Such an application has been upheld by the Gauhati High Court in the case of CIT vs. Haroocharai Tea Company 1977 CTR (Gau) 229 (1978) 111 ITR 495 (Gau). In the circumstances we see no error in the order of the AAC, which is hereby confirmed. 6. In the result, the appeal is dismissed.
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1979 (9) TMI 107
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... ... ..... TO at the relevant time, but the evidence on record produced by the assessee clearly goes to show that the deposit in the account of Smt. Savitri Balchandani is quite genuine. The discharge pronote was produced before the authorities below. The ld. ITO or the ld. AAC did not say that the said pronote was not genuine. It was also brought to the notice of the authorities below that the payment was made by a crossed cheque. This fact itself goes to show that the deposit was quite genuine. If the deposit was not genuine, the depositor could not have been paid the sum of Rs. 4,000 by way of crossed cheque. The authorities below failed to bring on record any positive material to show that the sum of Rs. 40,000 was paid to depositor in any other account. Under the circumstances, this deposit is also genuine, and there is no justification for sustaining any addition. The addition sustained by the ld. AAC on this score, is deleted. 31. In the result, all the three appeals are allowed.
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1979 (9) TMI 106
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... ... ..... as not taxable was a bonafide one and in filing the nil estimates the Official Liquidator did not move in mala-fide manner. The Tribunal also accepted this position in the context of levy of penal interest under s. 217 (1A). The ld. AAC has reproduced in his order para 24 of the Tribunal s order which is relevant. Such estimates based on bona fide belief, in view of the aforesaid Supreme Court decision and the Allahabad and Gauhati decisions, have to be held to be honest and fair estimates. The ld. AAC, in our opinion was right in his conclusion that the ITO had not been able to establish the default on the part of the assessee contemplated in s. 273 (a). We would rather say that the estimates filed by the Official Liquidator were not untrue at all and, therefore, there was no question of untrue estimates being filed knowing or believing that those were untrue. The penalties were rightly cancelled by the ld. AAC and hence uphold his order. 14. In the result, the appeals fail.
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1979 (9) TMI 105
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... ... ..... of seven partners came into existence and a partnership deed was also executed on 12th Nov., 1973. At the close of the accounting year, the books of the new firm were closed and the profits were divided according to the profit sharing ratio as specified in the Partnership Deed. On these facts, the case of the assessee is also supported by the decisions relied on by the ld. counsel. The decision relied on by the ld. Deptl. Representative is not applicable on the facts of the case. Apart from it, the majority of the decision on this point are in favour of holding that after the death of a partner, the firm shall stand dissolved unless there was contract to the contrary, as provided under s. 42(c) of the Partnership Act. 11. Thus, in our opinion, the finding of the ld. CIT(A) is not correct. The assessee was justified in filing two returns for the two periods. The ld. ITO is directed to complete separate assessments for the two parties. 12. In the result, the appeal is allowed.
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1979 (9) TMI 104
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... ... ..... im sales-tax as deduction on accrual basis though it is quantified and paid at a later stage. Kanga and Palkhivala in the Law and Practice of IT, 7th Edition, Volume l at the page 870 refer to the various decisions including the Supreme Court decision in Kedarnath Jute Manufacturing Co., Ltd.(1) and have approved the view that under the mercantile system of accounting a fiscal liability under a statute should be allowed as a deduction in the year in which the relevant transaction takes place. 13. To sum up, we find that the assessee s liability on sales and purchases made by him had arisen under the Sales-tax Act irrespective of his claim of refund at a later stage in respect of goods exported out of India or sold out of State and the assessee was entitled to claim deduction in respect of his liability under the mercantile system of accounting. 14. We, therefore, allow the appeal and delete the addition of Rs. 75,900 made by the ITO and confirmed by the learned CIT (Appeals).
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1979 (9) TMI 103
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... ... ..... rch, 1976. 3. Learned AAC cancelled the penalty on the ground that s. 19(3) of the WTO Act does not permit levy of penalty under s. 18 thereof on the legal representative of the deceased assessee. 4. This view of the learned AAC is supported by a decision of the Andhra Pradesh High Court in Smt. Yawarunnissa Begam vs. WTO (1). 5. The Jabalpur Bench of Tribunal has taken the same view in Veerbhandas Purswant vs. WTO (WTA No. 34(Jab) / 72-73) dt. 29th April, 1974, and WTA Nos. 24 to 28 (Jab) / 78-79 (WTO vs. Abdul Majid Khan) dt. 30th April, 1979. 6. Following the decisions cited above, we confirm the order of the learned AAC and dismiss the departmental appeal.
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1979 (9) TMI 102
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... ... ..... with jurisdiction to impose penalty was the ITO and not the IAC. The assessee had requested the CIT that view of the uncertainty about the legal position, the appeal may be kept pending to enable the assessee to seek instructions from the Board. 7. This application before the Commr. actually strengthens the contention of the assessee that he was labouring under a bonafide misconception about the procedural law. We are, therefore, clear that there was sufficient cause for the assessee for not presenting the appeal within the period as prescribed under s. 253(3) of the ITO Act. We may also for the sake of analogy refer to s. 14of the Limitation Act which allows exclusion of time during which the appellant bonafide carried on the proceeding before a wrong forum. 8. The delay is, therefore, condoned and the appeal is treated as having been filed within time. As we have already held that on merits the penalty could not be sustained, we cancel the penalty. 9. The appeal is allowed.
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1979 (9) TMI 101
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... ... ..... t grant interest under s. 214 while framing original assessment order. AAC was, therefore, justified in asking ITO to pass the rectification order granting it. Similarly, in K Bombay vs. ITO (2), it was held that when the last of the three instalments of advance-tax had been paid late but within the financial year the ITO s order granting interest on the last instalment was not prejudicial to the interest of the Revenue and the order of the Commr. setting aside the order of the ITO on this score was erroneous. The appeal of the assessee was accordingly allowed. In view of the aforesaid discussion, this much is very clear that he point involved in this appeal is not free from difficulty and, therefore, such a matter could not be reopened in proceedings under s. 154, the scope of which is limited to errors apparent from the record. The ITO could not change his opinion in the manner in which he has done. The appeal is accordingly accepted and the order under s. 154 is set aside.
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1979 (9) TMI 100
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... ... ..... lf. It is the case of the assessee that he filed his original estimate on the basis of the estimate filed by the firm of which he was a partner and that when that firm filed a revised estimate in its case he also filed a revised estimate as a consequence thereof. The AAC in the view taken by him, had not considered this aspect, viz., whether the assessee filed his original estimate knowing or having reason to believe it to be untrue and thereby reduced the first instalment of advance tax payable by him. In the absence of a finding that the assessee had under-estimated the advance tax payable by him and thus reduced the first instalment of advance tax, the question of charging interest under s. 216 would not arise. Since the AAC had not considered this aspect of the matter, we set aside his order and restore the appeal to his file with a direction to dispose it of afresh in the light of the above observations. 11. For statistical purposes, the appeal may be treated as allowed.
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1979 (9) TMI 99
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... ... ..... on to become a partner in a partnership firm. The reasoning of the AAC has, in our opinion attempted to unsettle this settled law. The reason that Shri Vasam Ashok has not contributed the capital to become a partner is not valid in law. The second reason which weighed with the authorities below for refusing to grant registration to the firm was that there was some discrepancy in the sworn statement of Shri Vasam Ashok. It is true that Shri Ashok stated that he got Rs. 6000 to his share of profit whereas the profit credited to his account was only Rs. 4,431. It is further true that Shri Ashok stated that the income of the firm was only Rs. 15,000 or Rs. 16,000 while it was more. These discrepancies, in our opinion, are too trivial to case doubt on the genuineness of the firm. Taking an overall view of the matter, we are convinced that the firm is genuine and the ITO is directed to grant registration to the firm for the asst. yr.1976-77. 3. In the result, the appeal is allowed.
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