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2015 (3) TMI 1354
Period of limitation – issuance of SCN or Delivery of SCN - alleged that SCN given to the petitioner beyond the period of six months – whether mere dispatch of a notice under Section 124(a) of the said Act would imply that the notice was “given” within the meaning of Section 124(a) and Section 110(2) of the said Act - HELD THAT:- The respondents in both the appeals shall be entitled to refund of 50% of the seized amount and the watches seized by the appellant within four weeks hence subject to an undertaking filed before the Registry of this Court within ten days that if the appellant succeed in appeal, they shall make good the dues along with interest.
List the matter after six weeks.
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2015 (3) TMI 1353
Selection and recruitment to the post of Physical Training Instructor Grade-III (PTI Gr. III) - Requisite qualification - whether the Division Bench of Rajasthan High Court is correct in reversing the judgment of the learned Single Judge and permitting the qualification of B.P. Ed. to be treated as equivalent to qualification of C.P. Ed. for the purpose of selection and recruitment to the post of Physical Training Instructor Grade-III (PTI Gr. III)?
HELD THAT:- The issue noticed at the outset must be decided on the basis of settled law noticed by learned Single Bench that recruitment process must be completed as per terms and conditions in the advertisement and as per rules existing when the recruitment process began.
In the present case, the Division Bench has gone to great lengths in examining the issue whether B.P. Ed. and D.P. Ed. qualifications are equivalent or superior to C.P. Ed. qualification but such exercise cannot help the cause of the Respondents who had the option either to cancel the recruitment process if there existed good reasons for the same or to complete it as per terms of advertisement and as per rules. They chose to continue with the recruitment process and hence they cannot be permitted to depart from the qualification laid down in the advertisement as well as in the rules which were suitably amended only later in 2011 - In such a situation, factual justifications cannot change the legal position that Respondents acted against law and against the terms of advertisement in treating such applicants successful for appointment to the post of PTI Gr. III who held other qualifications but not the qualification of C.P. Ed. Such candidates had not even submitted separate OMR application form for appointment to the post of PTI Gr. III which was essential as per the terms of advertisement.
The candidates who were aware of the advertisement and did not have the qualification of C.P. Ed. also had two options, either to apply only for PTI Gr. II if they had the necessary qualification for that post or to challenge the advertisement that it omitted to mention equivalent or higher qualification along with qualification of C.P. Ed. for the post of PTI Gr. III - Having not challenged the advertisement and having applied for the other post, they could not have subsequently claimed or be granted eligibility on the basis of equivalence clarified or declared subsequently by the State Government.
The order of the learned Single Judge is restored - appeal allowed.
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2015 (3) TMI 1352
Addition u/s 68 - genuineness, credit worthiness and identity of creditor - HELD THAT:- The assessee's version of truth was placed before A.O. also, but A.O. did not find any evidence contrary to above facts. CIT(A) further observed that the assessee’s husband was working in Meghalaya House and he used to come across the friend Mr. W. Sutong in the Meghalaya House.
When the assessee and her husband purchased a house, they had discussed the matter with the Mr. W. Sutong and Mr. W. Sutong agreed to pay them ₹ 16,18,000/- by cash in their bank account but later on they realized that they being in the government service, it is not proper to get loan from stranger. There will be problems for them and they returned the money immediately to the appellant's bank account by RTGS. The above submission of refund of money is available on record.
Therefore, ₹ 15,80,000/- was returned by assessee's husband from their joint account to Mr. W. Sutong. Hence, in our considered opinion, the CIT(A) has rightly gave a relief to the assessee of ₹ 15.80 Lakh. In the background of the aforesaid detailed discussions, we find that Ld. CIT(A) has rightly deleted the addition of ₹ 15,80,000/- and sustained the balance addition of ₹ 38,000/-. - Decided against revenue
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2015 (3) TMI 1351
Deduction u/s 80P - returns of income were not filed by the assessee either u/s 139(1) or u/s 139(4) or within the time limit provided u/s 142(1) - HELD THAT:- This Tribunal examined the issue elaborately in the case of Kadachira Service Co-operative Bank [2013 (2) TMI 208 - ITAT COCHIN] , M/s Kunnamangalam Co-operative Bank [2014 (10) TMI 350 - ITAT COCHIN] and M/s Pinarayi Service Cooperative Bank Ltd [2014 (7) TMI 1176 - ITAT COCHIN] and found that if the assessee failed to file the return of income within the prescribed time and claim deduction u/s 80P, then the assessee is not entitled for deduction u/s 80P.
Disallowance u/s 40(a)(ia) - interest was paid to non members without deducting tax - HELD THAT:- Assessee is carrying on banking activity. Therefore, deduction of tax at source either at the time of credit or payment of interest is a mandatory requirement. Hence, this Tribunal do not find any infirmity in the order of the lower authority. Accordingly, the orders of the CIT(A) on this issue are also confirmed. Assessee's appeal dismissed.
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2015 (3) TMI 1350
TP adjustment - arm‘s length pricing of international transactions - Whether the additions suggested by the TPO on account of Advertising/Marketing and Promotion Expenses was beyond jurisdiction and bad in law as no specific reference was made by the Assessing Officer, having regard to retrospective amendment to Section 92CA of the Income Tax Act, 1961 by Finance Act, 2012? - Transfer pricing adjustment made on account of payment of royalty to an associated enterprise - HELD THAT:- For detailed order see Sony Ericsson Mobile Communications India Pvt. Ltd. (Now known as Sony India Limited) Vs. Commissioner of Income Tax-II [2015 (3) TMI 580 - DELHI HIGH COURT] [
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2015 (3) TMI 1349
Complaints to Magistrate - Commencement of Proceedings before Magistrate - Sufficient ground of proceeding - Section 204(1) of Code of Criminal Procedure - Magistrate is of the opinion that there is no sufficient ground for proceeding, he should dismiss the complaint, after briefly recording the reasons for doing so - How does a Magistrate, while taking cognizance of an offence on complaint, indicate his satisfaction regarding the ground for proceeding against the accused?
HELD THAT:- There is no indication on the application of mind by the learned Magistrate in taking cognizance and issuing process to the Appellants. The contention that the application of mind has to be inferred cannot be appreciated. The further contention that without application of mind, the process will not be issued cannot also be appreciated. Though no formal or speaking or reasoned orders are required at the stage of Section 190/204 Code of Criminal Procedure, there must be sufficient indication on the application of mind by the Magistrate to the facts constituting commission of an offence and the statements recorded Under Section 200 of Code of Criminal Procedure so as to proceed against the offender. No doubt, the High Court is right in holding that the veracity of the allegations is a question of evidence.
Question is not about veracity of the allegations; but whether the Respondents are answerable at all before the criminal court. There is no indication in that regard in the order passed by the learned Magistrate.
The matter is remitted to the Magistrate for fresh consideration - Appeal allowed by way of remand.
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2015 (3) TMI 1348
Recovery proceedings - security furnished by petitioner as contemplated by Section 33(5) of Haryana VAT Act - petitioner states that it had offered the security but the same has not even been considered by the respondents - HELD THAT:- The writ petition is disposed of by directing the concerned officer of the respondents to decide whether the security offered by the petitioner is adequate or not.
Till such decision is taken and for a period of one week thereafter, the recovery shall not be made pursuant to the order dated 22.12.2014.
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2015 (3) TMI 1347
Addition based on seized papers - taxation from undisclosed income of seized document being fastened on assessee - HELD THAT:- Seized document found from the possession of Sh Kinda, belong to them and if it is claimed that said document belong to assessee, then in that event the onus of proof vest with the AO.
CIT(A) has rightly found that this onus has not been discharged by the AO, in so far as there is no corroborative evidence brought on record to substantiate that document or transactions mentioned therein belong to assessee except conjectures and presumptions and what to talk of any liability for taxation from undisclosed income of seized document being fastened on assessee.
CIT(A) as per the trite law that "there must be something more than suspicion to support an assessment, the assessment based on pure suspicion is bound to be quashed". CIT(A) has rightly concluded that the attempt of the AO to connect seized paper with assessee has failed and finding given in the assessment order is erroneous on facts and is perverse and whimsical and stands vitiated and any addition based thereon deserves to be deleted.
CIT(A) has rightly deleted the addition. No reason to interfere with the well reasoned order of the CIT(A), accordingly, we uphold the same and decide the issue against the Revenue by rejecting the ground of appeal filed by the Revenue. - Appeals filed by the Revenue stands dismissed.
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2015 (3) TMI 1346
Disallowance of deduction available to Co-operative society u/s 80P - assessee collecting deposits from members by way of corpus funds and other deposits - HELD THAT:- As in the case of Jafari Momin Vikash Co-op. Credit Society Ltd [2014 (2) TMI 28 - GUJARAT HIGH COURT] sub-section(4) of section 80P will not apply to an assessee which is not a co-operative bank. In the case clarified by CBDT, Delhi Coop Urban Thrift & Credit Society Ltd. was under consideration. Circular clarified that the said entity not being a co-operative bank, section 80P(4) of the Act would not apply to it. Revenue's contention cannot be entertained that section 80P(4) would exclude not only the co-operative banks other than those fulfilling the description contained therein but also credit societies, which are not co-operative banks. In the present case, respondent assessee is admittedly not a credit co-operative bank but a credit co-operative society. Exclusion clause of sub-section (4) of section 80P, therefore, would not apply. In the result, Tax Appeals are dismissed.
Referring to SRI BILURU GURUBASAVA PATTINA SAHAKARI SANGHA NIYAMITHA BAGALKOT [2015 (1) TMI 821 - KARNATAKA HIGH COURT] section 80P (4) was not applicable to cooperative societies and was restricted only to cooperative Banks which had got licence to do banking business from the RBI. As the assessee dealing only with its members, so it is to be considered a cooperative society only and not a bank. Considering the facts and circumstances of the case, we are reversing the order of the FAA. Effective ground of appeal, filed by the assessee, is decided in its favour.
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2015 (3) TMI 1345
Income from other sources - interest earned on Fixed Deposit prior to communication of project - classification of income - interest earned by the assessee from the nationalised banks as concerned with setting up or commencing of the business - HELD THAT:- The assessee deposited money in the bank is itself not sufficient to show that the deposit was made with a view to carrying out the business in the sense of earning profit by investment.
There was neither setting up nor commencement of business during the year under consideration,that non commencement of the project is continuing since 1993,that the money raised in form of OFCE was not raised for any construction of project or purchase of plant and machinery or for obtaining any license or letter of credit etc. but was only done with a specific and limited purpose to reduce resultant tariff of the project,that had nothing to do with the setting up or commencing of the business, that it was a pure and simple case of accruing of interest income from deposit-we are of the opinion that that the assessee earned the interest from the bank deposits and earning of interest was plainly not in the ordinary course of its business and that the interest earned by the assessee was rightly assessed under the head income from other sources.
We find that the FAA has clearly and logically distinguished the cases relied upon by the assessee. On the other hand,cases quoted by him, while upholding the order of the AO, fortify our view. He has also analysed the audited accounts and various agreements entered into by the assessee.In our opinion, his order does not suffer from any legal or factual infirmity. Considering the peculiar facts and circumstances of the case for the year under appeal, we decide effective ground of appeal against the assessee.
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2015 (3) TMI 1344
Transfer of lease in petitioner's favor - mining lease - grant of prior permission for transfer - subsequent action of transfer of shares by the shareholders of Gotan Lime Stone Khanij Udhyog Pvt. Ltd. on 23.7.2012 to Ultra-Tech Cement Limited resulting in the petitioner-Company becoming a wholly owned subsidiary - principles of natural justice.
Held that:- A bare reading of the provisions of Rule 15 reveals that a previous consent of the competent authority is necessary before a mining lease or any right title or interest therein is assigned, sublet, mortgaged or in any other manner transferred. The requirement of prior consent has also been provided even in a case where a lessee enters into or makes any arrangement, contract or understanding, whereby the lessee is or may be directly or indirectly financed to a substantial extent by or under which lessee's operations and undertaking is or may be substantially controlled by any person or body of person other than lessee. Whereafter, the stipulations regarding transfer, fees, 18 premium etc. have been indicated and exception provided regarding mortgage to State institution, Bank or State Corporation. The sub-rule (4) of Rule 15 provides for execution of a transfer lease deed in Form No. 15 within a period of three months of consent or within such period as may be allowed by the competent authority - Rule 72 of the Rules, which has been invoked by the respondents and relied on during the course of submissions provide that any lease, quarry licence, short term permit or any other permit granted otherwise then in accordance with the provisions of the Rules shall be deemed to be null and void.
From perusal of the show cause notice, the response made by the petitioner, the provisions of Rule 15 & 72 and the order dated 16.12.2014 passed by the respondents, it is apparent that the Secretary while passing the order dated 16.12.2014 has not at all dealt with any of the contentions raised by the petitioner in its reply to the show cause notice and after reproducing the contents of the show cause notice and the contentions raised by the petitioner has jumped on to the conclusion that the reply filed by the Company is an afterthought and was not satisfactory. Not a word has been indicated as to why and how the authority reached to the said conclusion.
The recommendation by the Assistant Mining Engineer was made on 2.4.2012 and by then the resolution and the affidavits had already been filed. So far as the making of inspection on 30.3.2012 is concerned, a look at the inspection report (pg. 72) reveals that the same merely indicates the status of the lease deed and leased area and nothing else, so as to vitiate the report if the same was made without affidavit having been filed in support of the application - the plea raised by the respondents seeking to support the order dated 16.12.2014 qua the pre 25.4.2012 events cannot be sustained.
Whether the action of shareholders of the Company in transferring its shares to Ultra Tech Cement Limited and consequently, the Company becoming wholly owned subsidiary of Ultra Tech Cement Limited amounts to violation of Rule 15(1)(b) of the Rules is the issue which requires consideration - Held that:- For alleging violation of provisions of Rule 15(1)(b) of the Rules, the transaction must be such whereby the lessee i.e. the Company will or may be directly or indirectly financed to a substantial extent or the lessee's operations or undertakings will or may be substantially controlled by any person or body of persons other than lessee. The pre-requisite for coming to a conclusion regarding violation of the provisions of Rule 15 would be an arrival to a conclusion that either the lessee company is directly or indirectly financed, or lessee's operations or undertakings are substantially controlled by any person or body of persons other than lessee - Nowhere in the show cause notice, the order dated 16.12.2014 or in reply to the writ petition, there is any allegation whatsoever by the State indicating either financing or any substantial control on the lessee's operations or undertakings by Ultra Tech Cement Limited. Apparently, only based on the assumed implication of the Company becoming wholly owned subsidiary of Ultra Tech Cement Limited that the present action appears to have been taken by the respondents.
Merely on account of the Company becoming a subsidiary of Ultra Tech Cement Limited on account of certain action of the shareholders of the Company, it cannot be said that the Company is being directly or indirectly financed to a substantial extent or the Company's operations or undertakings are substantially controlled by Ultra Tech Cement Limited, regarding which there are absolutely no allegations or material whatsoever. Therefore, on account of the petitioner-Company becoming subsidiary of Ultra Tech Cement Limited, it cannot be said that ipso facto the provisions of Rule 15(1)(b) of the Rules have been violated by the lessee i.e. petitioner-Company.
Thus, it is apparent that the allegations made in the show cause notice, the reason indicated in the order dated 16.12.2014 and the various plea raised by the respondents in the present writ petition seeking to substantiate the order dated 16.12.2014 have absolutely no substance. Neither the events prior to 25.4.2012 nor the events subsequent to 25.4.2012 can be said to be sufficient for taking action under provisions of Rule 72 of the Rules so as to either cancel the order dated 25.4.2012 and/or cancel the mining lease standing in favour of the petitioner-Company.
Petition allowed.
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2015 (3) TMI 1343
Revision u/s 263 - AO has not disallowed provision for gratuity and provision for leave encashment - rectification u/s. 154 - computation of book profit u/s 115JB - HELD THAT:- CIT has reached to a prima facie conclusion that assessment order is erroneous and so also prejudicial to the interest of Revenue for the reason that the AO has not disallowed provision for gratuity amounting to ₹ 25.75 lakhs and provision for leave encashment amounting to ₹ 11,79,202 while framing assessment u/s. 143(3) and thereafter computing book profit u/s 115JB of the Act.
Even now before us, on merits the assessee has nothing to say rather the assessee on merits has conceded this issue that the same is subject-matter of rectification u/s. 154 of the Act. As the issue is covered in the case of South India Steel Rolling Mills (1997 (2) TMI 10 - SUPREME COURT), we confirm the order of CIT revising the assessment. But the assessment cannot be directed to be reframed de-novo and AO will go into the issues raised by CIT in his order i.e. the issue of provision of leave encasement and provision of gratuity. - Decided against assessee.
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2015 (3) TMI 1342
Disallowance of interest expense - HELD THAT:- CIT(A) has held that the issue of interest expenditure is pending before the Hon’ble Special Court. It is the say of the proceedings in which the said issue of interest was issued by the custodian have been already concluded which fact has already been recorded by the Ld. CIT(A) in the impugned order. We, therefore, direct the CIT(A) to consider this fact while deciding the issue afresh. CIT(A) may also direct for the taxing of income in the hands of the recipient (family members) in accordance with the method of accounting followed by them and as per the provisions of the law. Ground No. 4 is treated as allowed for statistical purpose.
Interest u/s. 234A, 234B and 234C - HELD THAT:- The Tribunal has considered this issue at para-6 of its order and restored the matter to the file of the AO to recompute the interest liability as per the provisions of the law. We direct accordingly. Ground No. 6 is treated as allowed for statistical purpose.
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2015 (3) TMI 1341
Penalty u/s 271(1)(c) - assessee on various dates had not attended the assessment proceedings - admission of additional evidence - Held that:- Though it is a fact that assessee was provided a number of opportunities to submit details as mentioned in Ld. CIT(A)’s order yet the fact remains the additional evidence go to the root of the matter, which were not taken into account by CIT(A) especially in view of the fact that A.O. had issued remand report also.
We deem it appropriate to set aside the order of Ld. CIT(A) and remit back the issue to the office of Ld. CIT(A) who should readjudicated on the grievances of the assessee after taking into account the additional evidence and remand report. We also direct the assessee to present itself before Ld. CIT(A) for speedy disposal of its appeal and the opportunity granted to assessee should not be misutilized. - Decided in favour of assessee for statistical purposes.
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2015 (3) TMI 1340
Mining Services - environmental clearance with regard to extraction of minor mineral required - Held that:- In case where quarrying/mining/lease which were existing on the date of issuance of Notification dated 14.09.2006 or on the date of issue of the order dated 18.05.2012 by the Government of India, Ministry of Environment and Forests with regard to area less than 5 hectares no environmental clearance with regard to extraction of minor mineral is required. Notification dated 14.09.2006 contemplated obtaining environmental clearance only with regard to new projects/new activities.
Government Order dated 10.01.2014 cannot be relied on by the parties in view of the restraint order issued by the National Green Tribunal dated 27.09.2013 till such time the restraint order continues.
By amendment of Section 14 by Act 37 of 1986 making Section 4 applicable to minor minerals also the provision contained in Section 4 shall be applicable to mining operations by a person holding mining lease or any other kind of mineral concession. It cannot be accepted that mining operation with effect from 10.02.1987 cannot be continued by a person holding any other mineral concession apart from mining lease.
Judgment of the Apex Court in Deepak Kumar's case [2012 (2) TMI 656 - SUPREME COURT OF INDIA] did not contemplate environmental clearance for an area less than 5 hectares with regard to existing mining lease/mining permits on the date of judgment. Paragraph 29 of the judgment clearly directed that leases of minor minerals including their renewal for an area of less than five hectares be granted by the State/Union Territories only after getting environmental clearance.
Environmental clearance as contemplated by Notification dated 14.09.2006 required environmental clearance for new projects/new activities. The Notification dated 14.09.2006 having been applied vide order dated 18.05.2012 of the Government of India, Ministry of Environment and Forests all mining operations for new project and new activities for an area less than 5 hectares after 18.05.2012 required environmental clearance carried through either a mining lease or mining permit.
Interim order passed by the Apex Court on 27.01.2012 was intended by the Supreme Court to operate till the Rules have been framed by the States taking into consideration the guidelines and recommendations of the Ministry of Environment and Forests.
As per Rule 68 no mining/quarrying operations can be permitted without there being an approved mining plan. But such rule is subject to exception as engrafted in Rule 66, i.e., for existing lease holders, time has been allowed to submit mining plan.
Writ Petitions relating to Group - I, Public Interest Litigations are disposed of in accordance with our conclusions and directions contained in paragraph 82. All the Writ Petitions relating to Group - II, challenging quarrying operations by private individuals are disposed of with a direction to the District Collector to examine the right of quarrying owners/mining permit owners (private respondents) to carry mining operations and to issue necessary clarifications/clearance only after being satisfied that such mining operations are in accordance with the 2015 Rules as well as the observations made by this Court in the present case.
Writ Petitions of Groups - III & IV by quarry owners as well as quarry owners seeking police protection are disposed of giving liberty to the petitioners to approach the District Collector for carrying on mining operations which clearance shall be issued by the District Collector only after being satisfied that they are entitled to carry mining operations as per the 2015 Rules and the observations made by this Court in the present case. W.P(C). No. 7632 of 2014 is dismissed upholding the order of State Government dated 19.2.2014 cancelling the quarry lease. All the three cases of miscellaneous Group are disposed of in the following manner:
W.P is disposed of giving liberty to the petitioner to submit appropriate application before the competent authority seeking permit of ordinary earth as per the 2015 Rules.
Writ Appeal No. 1566 of 2014 is dismissed giving liberty to the appellant to make fresh application before the Panchayat for obtaining licence under the Kerala Panchayat Raj Act after obtaining necessary permit for quarrying operations in accordance with the 2015 Rules.
W.P(C) No. 2636 of 2015 is dismissed having become infructuous due to enforcement of 2015 Rules with effect from 07.02.201(i) Writ Petitions relating to Group - I, Public Interest Litigations are disposed of in accordance with our conclusions and directions contained in paragraph 82.
(ii) All the Writ Petitions relating to Group - II, challenging quarrying operations by private individuals are disposed of with a direction to the District Collector to examine the right of quarrying owners/mining permit owners (private respondents) to carry mining operations and to issue necessary clarifications/clearance only after being satisfied that such mining operations are in accordance with the 2015 Rules as well as the observations made by this Court in the present case.
(iii) Writ Petitions of Groups - III & IV (except WP(C). No. 7632 of 2014), by quarry owners as well as quarry owners seeking police protection are disposed of giving liberty to the petitioners to approach the District Collector for carrying on mining operations which clearance shall be issued by the District Collector only after being satisfied that they are entitled to carry mining operations as per the 2015 Rules and the observations made by this Court in the present case.
(iv) W.P(C). No. 7632 of 2014 is dismissed upholding the order of State Government dated 19.2.2014 cancelling the quarry lease.5.
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2015 (3) TMI 1339
Reopening of assessment - non supplying of reasons to believe to assessee - Held that:- We find that this letter is nothing but a questionnaire served upon the assessee. By any stretch of imagination, a questionnaire cannot replace or supplement the supply of reasons to the assessee which in the light of the judicial decisions discussed hereinabove is sine-qua- non for reassessment - DR could not adduce any evidence which could suggest that the reasons were actually supplied to the assessee. Considering the facts of the case in the light of the judicial decisions referred to hereinabove, we set aside the assessment order for want of jurisdiction and quash the reassessment order for both the years under consideration. - decided in favour of assessee,
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2015 (3) TMI 1338
Bogus share transaction - Unexplained cash credit for Capital Gains - correct head of income - treatment of gain arising on the transaction of sale, purchase of shares - to be assessed under the head income from long term capital gains as per the assessee or income from other sources as determined by the authorities below - Addition on the basis statement of third party and evidence collected by the department - non giving opportunity of being heard as well as cross examining the person concerned - Held that:- As decided in case of Smt. Smita P. Patil & Ors. Vs. ACIT [2013 (7) TMI 950 - ITAT PUNE] the transaction was with regard to purchase of shares of M/s. Fast Track Entertainment Ltd., which in turn were purchased through the share broker M/s. DPS Shares and Securities Ltd. and the Tribunal had accepted the said transaction as genuine.
The transaction of purchase and sale of shares of M/s. Fast Track Entertainment Ltd. was a genuine transaction and the claim of long term capital gain was allowed in the hands of the assessee therein. In the totality of the above we direct the Assessing Officer to compute the income in the hands of the assessee under the head ‘income from long term capital gains’. - Decided in favour of assessee.
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2015 (3) TMI 1337
Payment of tax at compounded rate - section 8(b) of KVAT Act - assessment years from 2008-09 to 2013-14 - whether the petitioners, who are admittedly dealers engaged in the production of granite metal with the aid of mechanized crushing machines, are entitled to claim exemption from separate assessment, in respect of the M-sand produced by them using VSI/HSI machines, that have not been reckoned for the purposes of compounding under Section 8(b) of the K.V.A.T. Act?
Held that:- The provisions of S. 8(b) of the K.V.A.T., as they stood during the relevant period, envisaged a payment of tax at compounded rates, as an alternative to the regular payment of tax under Section 6 of the Act, for dealers producing granite metal using the aid of mechanized crushing machines. The scheme of the compounding provision suggests that dealers could opt to pay a tax, that was computed as the sum total of the amounts chargeable on specified machines that were used by the dealer in the production of granite metal.
It was envisaged that once the dealer paid tax in accordance with the scheme, by paying a tax computed on the basis of the number of specified machines used by him, he would be entitled to an exemption from separate assessment in respect of the M-sand that was produced in the course of production of granite metal.
The legislative scheme envisaged the payment of compounded tax by reckoning only certain specified machines, from among the various machines that were used in the production of granite metal, and the VSI/HSI machine was not one of them - The demands made on the petitioners, in connection with a separate assessment of the M-sand or Manufactured sand obtained through the use of VSI/HSI machines, cannot be legally sustained - The notices and orders, impugned in these Writ Petitions, are consequently quashed.
Petition allowed.
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2015 (3) TMI 1336
Nature of expenditure - disallowance of product development expenditure - revenue or capital expenditure - Held that:- The expenditure under consideration is similar to the expenditure claimed by the assessee in the earlier years and following the same parity of reasoning, we hold that the assessee is entitled to the claim of expenditure on account of product development as revenue expenditure. See MAX INDIA LTD. [2006 (6) TMI 422 - ITAT AMRITSAR]
Claim of the sales tax subsidy - Held that:- As relying on assessee's own case we direct the Assessing Officer to treat the sales tax subsidy as capital receipt in the hands of the assessee.
Allowability of payments made to M/s L&T Infotech Ltd. on account of annual maintenance charges - Held that:- As in assessment year 2003-04, held that the said expenditure was revenue in nature as it cannot be said to have brought in enduring benefit. The expenditure claimed by the assessee, during the year under consideration, was similar to the expenditure claimed in the earlier years and following the same parity of reasoning, we hold that the annual maintenance charges of ₹ 24,37,500/- paid to L&T Infotech Ltd. is to be allowed as a revenue expenditure.
Expenditure incurred on technical know-how i.e. reimbursement of salary, etc. to John Deere India Pvt. Ltd. - The said disallowance was made in the hands of the assessee following the earlier years starting from assessment year 2001-02 - Held that:- From ratio laid down by the Tribunal in assessee’s own case from year to year, we find no merit in the ground of appeal Nos.3 and 4 raised by the Revenue and hold that the expenditure incurred on technical know-how i.e. reimbursement of salary payable to the John Deere India Pvt. Ltd. is an allowable expenditure
Allowability of deferred sales tax equalization liability confirmed.
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2015 (3) TMI 1335
Unexplained credit u/s 68 - CIT-A deleted the addition by admitting additional evidence at appellate stage - Held that:- As far as the issue of admission of additional evidences is concerned before us the assessee has filed only copies of the accounts and copies of the TDS certificate, which cannot be construed as evidences because for proving the loans u/s 68. Assessee is required to file confirmation as well as show credit worthiness of such parties therefore we decline to admit these papers as additional evidence because assessee is in the guise of these copies of accounts asking for more opportunity which is not permissible under the law. Therefore, application for admission of additional evidence is rejected.
In the light of the rejection of application for additional evidence the ground raised by the assessee required to be dismissed because assessee has miserably failed to prove the loans to the extent of ₹ 41,59,000/- because no confirmation or any evidence proving such transaction was furnished before AO or even before CIT(A) or even before us.
CIT(A) has discussed four items of loans in case of G.S.Bricks, New Bharat Shuttering Store, Pyare Lal Rajinder Kumar, Punjab Trading Co. from whom loans of ₹ 2 Lacs, ₹ 2 Lacs, ₹ 3 Lacs, and ₹ 3.50 lacs have respectively been taken. However the relief has been allowed to the extent of ₹ 20 lacs without any discussion in respect of the rest of the items amounting to ₹ 9,50,000/-. In the four cases, in our opinion the CIT has correctly accepted the loans because the amount comes through cheques and confirmation of PAN numbers were furnished.
However, since no discussion has been made in respect of other loans to the extent of ₹ 9,50,000/- therefore we set aside the order of Ld. CIT(A) in respect of the rest of the items amounting to ₹ 9,50,000/- and remit the matter back to his file with a direction to decide the issue after recording findings in respect of such items also - Appeal of the Revenue is partly allowed for statistical purposes.
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