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Showing 21 to 40 of 563 Records
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2008 (6) TMI 616
Claim made on amount towards professional fees for assessment of market attractiveness of business - Claimed deduction u/s 36(1)(iii).
Claim made on amount towards professional fees for assessment of market attractiveness of business - gaining global market, reputise on dealing with global markets, evaluation of business ability to compete, analysis of business’s future growth trend, development detailed business strategies to grow in the dynamic business environment - revenue or capital Expenditure ? - Whether the Tribunal was right in law in deleting the addition in respect of payments made to M/s. McKinsey & Co., management consultant and the same should be allowed as revenue expenditure is valid in law? - Expenditure incurred as interest paid on capital borrowed - AO added the entire interest to the cost of the fixed asset by rejecting the claim of the assessee that the expenditure is revenue in nature.
HELD THAT:- It is well-settled that it is not only permissible, but is also necessary for any business to update its own knowledge and adopt better ways of organising its business, if it is to survive in the market. The expenditure incurred for such purpose cannot be regarded as capital expenditure and it is only a revenue expenditure. The fees paid to the consultant was disallowed by the revenue officials as capital expenditure on the premise that the benefits derived from such consultancies would enure to the future years also. According to the ld counsel for the assessee, this question of law is covered against the revenue by the decision of this Court in the case of CIT v. Crompton Engineering Co. Ltd.[1998 (6) TMI 23 - MADRAS HIGH COURT] - Hence, the first question of law is covered against the assessee (sic - revenue).
Claimed deduction u/s 36(1)(iii) - Whether the Tribunal was right in law in deleting the addition made towards interest paid on borrowed capital is valid? - HELD THAT:- Assessee borrowed money for the expansion project and claimed deduction u/s 36(1)(iii). In respect of the AY 1994-95 in assessee’s own case, the issue has been decided in favour of the assessee by a Division Bench of this Court in the case of Carborandum Universal Ltd.[2006 (2) TMI 649 - MADRAS HIGH COURT]. This factum has also been brought to the knowledge of the Court by the learned counsel for the assessee.
Therefore, the appeals are dismissed as the questions of law raised in the present appeals are covered against the revenue.
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2008 (6) TMI 615
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... ... ..... ue regarding jurisdiction cannot be adjudicated in the appeal before it. The National Commissioner unfortunately does not appear to have referred to its earlier decision while dismissing the revision petition. 8. In the aforesaid background, we are of the view that the issue relating to jurisdiction has to be decided by the forums first. 9. We therefore, set aside the impugned order of the National Commission confirming the order passed by the State Commission, and remit the matter to the State Commission to consider the question of jurisdiction. To avoid unnecessary delay let parties appear before the State Commission without further notice on 7th of July, 2008 so that the date of hearing can be fixed. We make it clear that we have not expressed any opinion on the merits of the case. The parties are permitted to produce certified copy of the judgment so that necessary follow up action can be taken. 10. The appeal is allowed to the aforesaid extent with no order as to costs.
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2008 (6) TMI 614
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... ... ..... was ₹ 7,40,23,477/- as against the cumulative amount of abatement of ₹ 10,32,63,267/- claimed up to January, 2007.” 5. Ld. Counsel submits that there was an error in the annexure, which was submitted to the adjudicating authority and he draws our attention to annexure attached to the order. We find that the balance for the period in question, i.e., March, 2007 was ₹ 152.17 crores, while the abatement claimed by the applicant was ₹ 108.76 crores. We find that the balance in the Cenvat account is very much higher and the reasoning for non-imposing penalty in earlier proceedings will be valid for this case also. As such, we find that the penalty on the appellants under the provisions of Rule 15(2) of Cenvat Credit Rules is unwarranted and is not sustainable. That portion of the order, which imposed penalty on the appellants is liable to be set aside and we do so. Accordingly, the appeal is partly allowed as indicated above. (Dictated in Court)
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2008 (6) TMI 613
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... ... ..... he petitioner to file an application praying for payment of interest on the amount refunded regarding anti-dumping duty within a fortnight from this date before the Assistant Commissioner of Customs, Appraising and Refund Section, Kolkata, respondent no.3. If such application is filed within the time as stipulated above, the said respondent shall dispose of the same by passing a reasoned order in accordance with law to be communicated to the petitioner after giving an opportunity of hearing to the petitioner. Such exercise shall be carried out by the respondent no.3 within four weeks from the date of filing such application. I make it clear that I have not gone into the merits of this case and all points are left open to be dealt with by the respondent no.3 in the event the application is filed within the time as stipulated. No order as to costs. All parties concerned are to act on a signed copy of the minutes of the operative portion of this order on the usual undertakings.
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2008 (6) TMI 612
Suspension of CHA licence - charge of forgery dropped, which was the base of suspension of licence - penalty - Held that: - there was specific finding regarding forgery and mis-declaration of goods by the adjudicating authority against the appellant and the impugned order was passed immediately after passing the adjudication order. The appellant filed appeal and the Commissioner (Appeals) reduced the penalty and the appellant's appeal against the Commissioner (Appeals) order is still pending with the Tribunal. Therefore, the allegation against appellant regarding mis-declaration of goods is still there - appeal dismissed - decided against appellant.
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2008 (6) TMI 611
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... ... ..... e Assessing Officer shall recompute the deemed dividend after giving adequate opportunity to the assessee to produce all such evidence in regard to the computation. In regard to the alternate prayer of the assessee that the assessee being an industrial undertaking is eligible for the exemption of its total income under the provisions of section 80IB (4). As this issue has not been considered by the Assessing Officer in the interest of natural justice this issue is also remitted back to the file of the Assessing Officer to verify the allowability of deduction under section 80IB (4). The assessee shall be at liberty to raise all such submissions and produce all such evidences as required to prove its claim before the Assessing Officer. The Assessing Officer shall grant the assessee adequate opportunity to prove its claim in the set aside proceedings. 15. In the circumstances, the appeal of the assessee is partly allowed for statistical purpose. Pronounced in the open Court on.
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2008 (6) TMI 610
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... ... ..... The lending of money appears to be a business pursued by the assessee even during earlier year. Assessee charged interest from its Director as well. Hence the lending money could be treated as the business transaction and riot attracting section 2(22)(e). Appeal by the assessee on this ground is allowed. 10. Coming to the second ground, it is against the charging of interest under section 234D. The assessee’s Representative submitted that in the body of the assessment order, the Assessing Officer directed to charge only interest under sections 234B and 234C. This appears to be correct. In the absence of direction, we are of the view that this plea of the assessee is to be accepted. The appeal by the assessee on this ground is allowed. 11. Coming to the next ground in respect of charging of interest under section 234B, which is consequential. The Assessing Officer may give consequential relief in accordance with law. 12. In result, the appeal of the assessee is allowed.
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2008 (6) TMI 609
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... ... ..... ently appeal as filed on that ground would not be maintainable. In so far as question (b) is concerned, there are concurrent findings of fact by the Commissioner (Appeals) as also by ITAT in favour of the assessee. Once there are concurrent findings of fact, the question of law does not arise. Consequently appeal on that ground also dismissed.
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2008 (6) TMI 608
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... ... ..... oner. This court is bound to give full effect to the statutory provisions and petitioner should be given the benefit of the section. Read in the light of the law as laid down by the Apex Court in the aforesaid decisions, sec.447(6) entitles the petitioner for deemed license for the period required in the application subject to the provisions of the Act, Rules and the Bye-laws and on conditions which would have been ordinarily imposed. 9. In view of the above position, the writ petition is disposed of holding that the petitioner is entitled to deemed WP(C) 13844/2008 license as provided under section 447(6) of the Act and restraining the respondent Corporation from preventing the petitioner from carrying on the retail shop at the premises mentioned above. However, it is clarified that in case any of the provisions of the Act, Rules or Bye-laws are not complied with, it will be open to the Corporation to take such action as is permissible in law, with notice to the petitioner.
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2008 (6) TMI 607
Addition u/s. 69B - addition based on the value adopted by the stamp valuation authority - investment made in land - consideration paid higher than that stated in the sale deed - land was agricultural land which was subsequently converted in industrial land - determination of market value for computing payment of stamp duty.
HELD THAT:- The consideration mentioned in the sale deed differs from the consideration admitted in the course of recording of statement by the AO of the sellers on 5th Jan., 2006. Again, the consideration, as averred in the affidavit made by the sellers before the Civil Judge, on 25th Nov., 2003 reiterates the consideration i.e. as stated in the sale deed. Quite clearly, the statements of the sellers are not only inconsistent but are contradictory.
We are also conscious of the fact that both the stands of the sellers were before the AO. Therefore, while recording the statements of the sellers on 5th Jan., 2006, the AO should have made appropriate query and confronted the seller. So, however, neither such action has been taken at the time of recording the statement and nor subsequently before completion of the assessment proceedings. The impact of the aforesaid situation is that the statement attributed to the sellers becomes suspect. Moreover, the statement of the seller given on 5th Jan., 2006 lies uncorroborated. For the reasons enumerated above we are inclined to uphold the stand of the CIT(A) that the statement of the seller is unreliable.
If the evidence in the shape of the statement of the seller dt. 5th Jan., 2006 is removed from the scenario, there remains no cogent evidence with the AO to rebut the consideration stated in the sale deed. It is in this manner, in our considered opinion, the legal position emerging in the case of P.V. Kalyanasundaram [2006 (2) TMI 79 - MADRAS HIGH COURT] is attracted to the present case. Thus, on the basis of the parity of reasoning upheld in the case of P.V. Kalyanasundaram (supra), the impugned addition is liable to be deleted.
We are in agreement with the order of the CIT(A) that the fiction created by s. 50C is for the limited purpose of computing the capital gains. It only seeks to make a special provision for determining the full value of consideration in cases of transfer of immovable properties for the purpose of s. 48 of the Act. Therefore, the fictional regime of s. 50C is not available with the AO in support of his case of invoking s. 69B against the present assessee.
Therefore, we hereby sustain the order of the CIT(A) - In the result, the appeal of the Revenue is dismissed.
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2008 (6) TMI 606
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... ... ..... als). However, as far as disallowance of interest under sec.36(1)(iii) of the IT. Act in respect of interest free advance is concerned, the same has to be examined as to whether such advances were made for the purpose of business expediency or otherwise. These issues have not been dealt with by the lower authorities, particularly, in the light of the decision of the Hon'ble Supreme Court in the case of SA Builders Ltd. (supra). Therefore, as far as disallowance of interest under sec.36(1)(iii) in respect of interest free advance is concerned, we set aside the order of the CIT(Appeals) and remit the matter to the file of the Assessing Officer with a direction to examine the issue in the light of the decision of the Hon'ble Supreme Court in the case of SA Builders Ltd. (supra) and decide the issue in accordance with law, after affording opportunity of hearing to the Assessee. 10. In the result, the appeal filed by the Assessee is partly allowed for statistical purpose.
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2008 (6) TMI 605
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... ... ..... he sense that if these companies are held as conduits and if conduits are ignored, the ultimate tax liability of IXS will not alter. Having found that the investment companies, namely, FIPL and HIPL were functioning as separate legal entities in its own name and carried out its objects in terms of its memorandum of association and having found that the transactions between these investment companies and IXS were at arms' length, we are unable to agree with the finding of the Assessing Officer that these entitles are mere paper or dummy entitles. Thus, the respective income shall be assessable in the respective hands in accordance with provisions of law as if all these entities are separate legal entities and not conduits. 5. Ground no. 3 In view of the above adjudication as discussed in Ground No. 2, the issue raised in ground no.3, becomes infructuous, hence, needs no adjudication. 6. Consequently, the appeal is allowed. Order pronounced in the Open Court on 27.06.2008.
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2008 (6) TMI 604
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... ... ..... of section 14A, no deduction shall be allowed in respect of expenditure incurred in relation to the exempt income, which does not form part of the total income. However, it is also obvious that there has to be an employee or employees entrusted with the duty of receiving the above mentioned 25 dividends relating to the units/shares over the period of time for the purpose of receiving them, accounting them, depositing them in the relevant bank accounts etc. It cannot be stated no part of the salaries or otherwise is incurred in respect such exempt income. The man-hours of the concerned employee(s) are certainly relatable to the exempt income within the meaning of provisions of section 14A. In principle, there has to be some disallowance. Thus, we are of the opinion, that disallowance of a round sum amount of ₹ 50,000 would meet the ends of justice. Accordingly, the ground of the assessee is partly allowed. 23. In the result, the appeal of the assessee is partly allowed.
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2008 (6) TMI 603
Appeal - Restoration of ... ... ... ... ..... since the company had paid up the entire amounts due to the creditors. Therefore, the appellant is seeking for restoration of the appeal as the company continues to be in existence. 2. emsp The learned DR refers to the comments filed by the Commissioner in the matter. 3. emsp Heard both sides in the matter. We notice that the appeal was dismissed as abetted (sic) (abated) under Rule 22 of CESTAT Procedure Rules by following the High Court rsquo s order of winding up of the company. Now the order of winding up has been recalled by the High Court by their order dated 17th April, 2008. In view of this position, the Stay Order and the Final Order, dismissing the application and appeal, are recalled and the appeal and stay application are restored to their original numbers. Stay application to come up for consideration on 31st July, 2008. The learned Counsel seeks for out of turn issue of the order. Registry to issue this order out of turn. (Pronounced and dictated in open Court)
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2008 (6) TMI 602
Appeal to Appellate Tribunal - Maintainability of - Transfer of business ... ... ... ... ..... 7-2006 was allowed. Perusal of the business transfer agreement shows that M/s. Amri India Pvt. Ltd. took over M/s. Ariane Orgachem Pvt. Ltd. as a going concern, which would mean that all assets and liabilities of M/s. Ariane Orgachem Pvt. Ltd. were taken over by M/s. Amri India Pvt. Ltd. Therefore, the present appeal by M/s. Ariane Orgachem Pvt. Ltd. is not maintainable as they have ceased to have any interest in the business and they cannot be said to be aggrieved by the order of the Commissioner (Appeals), which is subsequent to their sale of the business to M/s. Amri India Pvt. Ltd. Hence the stay application is dismissed. The COD application is dismissed. The appeal is dismissed as not maintainable. (Pronounced in Court)
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2008 (6) TMI 600
Settlement of case - Immunity from penalty ... ... ... ... ..... The export duty/cess in this case is settled at Rs. 52,46,637/-. This amount stands paid. Interest emsp The applicant has paid the interest amount of Rs. 8,46,223/-. Penalty emsp In view of the above discussions, the Bench grants immunity from penalty in excess of Rs. 50,000/- (fifty thousand) to the applicant and grants immunity from penalty to all the co-applicants. Prosecution emsp The Bench grants immunity from prosecution to the applicant and the co-applicants under the Act in so far as this case is concerned. 10. emsp The above immunities are granted under sub-section (1) of Section 127H of the Act. Attention of the applicant is also invited to the provisions of sub section (2) and (3) of Section 127H ibid. 11. emsp This order of settlement shall be void in terms of sub-section (8) of Section 127C of the Act, if the Settlement Commission subsequently finds that it has been obtained by fraud or misrepresentation of facts. 12. emsp All concerned are informed accordingly.
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2008 (6) TMI 599
Confiscation of goods - Misdeclaration of goods ... ... ... ... ..... T0021. For this reason, the Additional Commissioner held that the goods had been misdeclared and accordingly confiscated them with an option to redeem the same on payment of fine of Rs. 33,000/- and imposed penalty of Rs. 16,000/-. The adjudication order was upheld by the Commissioner (Appeals) hence this appeal. 2. emsp We have heard both sides. There is no dispute regarding the import of Calibrator in December, 1997 and return for removing defects to the Italian manufacturer and its subsequent re-entry into India. The Italian manufacturer had also confirmed that new machine was despatched to the importer in India by mistake. In the circumstances, there is no reason for us not to accept the explanation of the importer that the receipt of the new machine in October, 2000 was a bona fide mistake, and was not the case of misdeclaration of the goods. We, therefore set aside the impugned order in regard to confiscation, fine and penalty and allow the appeal. (Pronounced in court)
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2008 (6) TMI 598
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... ... ..... ted that the ITAT should have held that the assessees failed to prove that the explanation is bona fide and all facts relating to the some material have been disclosed by them. We are unable to accept this contention in the facts of the present case. The ITAT was justified in coming to the conclusion that there is no deliberate concealment. Indeed, it was not possible to arrive at the finding that the assessees deliberately concealed the income even though they had disclosed the material relevant to the computation of their income. 2. In these circumstances, it is clear that the assessees have proved that all the facts relating to and material to the computation of the total income have been disclosed by him. It, therefore, cannot be said that the facts have not been disclosed by them solely because those facts have been disclosed in the returns filed late, and the delay in respect of which has been condoned. 3. There is no merit in these appeals, which are hereby dismissed.
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2008 (6) TMI 597
Pre-deposit - principles of natural justice - several opportunities were granted to the petitioners to comply with the pre-deposit order - Held that: - we direct that the petitioners shall deposit a total amount of ₹ 44 lacs including the amount of ₹ 12,78,000/- lacs already deposited by the petitioners earlier.
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2008 (6) TMI 596
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... ... ..... sessment is validly reopened, the other additions could also be made legally, but the action of reopening has to take precedence for framing the assessment. Unless and until the assessment is validly reopened, no addition can be made whether on the item based on which reopening was made or on other items and ultimately held that in the absence of valid and proper initiation of reopening proceedings under section 147 of the Act, reassessment could not be made. 9. We are in complete agreement with the reasoning given by the Tribunal, which is the stated and well established legal principle pertaining to reopening of assessment under section 147 of the Act. When the reasoning given for reopening of assessment is not available at the time of initiation of reopening, the reopening could only be regarded as not in accordance with law and invalid. 10. For the reasons stated above, the appeal deserves to be dismissed and it is accordingly dismissed. Miscellaneous petition is closed.
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