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Showing 81 to 100 of 2053 Records
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2017 (11) TMI 1976
Validity of reopening of assessment u/s 147 - as argued No valid notice issued - Assessee submitted notice was issued by the ITO Ward-2 (4), Meerut who had no jurisdiction on the case of the assessee - HELD THAT:- The notice under Section 148 of the Act was issued by the ITO Ward-2 (4), Meerut for initiating the proceedings under Section 147 of the Act, on the basis of the said notice the assessment has been framed by the ITO, Baraut who had not issued any, therefore, the assessment framed U/S 144 of the Act by the ITO, Baraut was void.
In the present case, it is an admitted fact that the AO who framed the assessment U/S 144 of the Act, never issued any notice for initiating the proceedings under Section 147 of the Act, therefore, in the absence of any valid notice being issued by the AO the present assessment order was not valid, accordingly the same is quashed. - Decided in favour of assessee.
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2017 (11) TMI 1975
TP Adjustment - comparable selection for Design Engineering Services - HELD THAT:- Rolta India Ltd. having different accounting period cannot be selected as comparable and hence, the same is directed to be excluded from the final list of comparables.
Accentia Technologies Ltd. was engaged in KPO services, then the margins of same cannot be compared with the margins of assessee being functionally different. Accordingly, we hold so and direct the Assessing Officer/TPO to exclude Accentia Technologies Ltd. from final list of comparables.
KLG Systel Ltd. - We direct the Assessing Officer/TPO to apply segmental details of activity which is functionally comparable to the assessee in order to work out the margins of said concern. Accordingly, we direct the Assessing Officer/TPO to re-compute the margins of KLG Systel Ltd. and include the same in final list of comparables.
Neilsoft Ltd. - From the details filed by the assessee, we find that in all the earlier years, wherein the said concern was selected as comparable and its margins were applied as part of final set of comparables, the said concern was showing profits and only in this year it had shown marginal loss; hence there is no merit in excluding the said concern from the final set of comparables in the instant assessment year on the ground that it has shown losses. In the absence of Revenue establishing that the said concern was persistent loss making concern, merely because the said concern during the year had shown losses, the margins of the said concern could not be excluded. Accordingly, we hold so and direct the Assessing Officer to include the margins of said concern in order to benchmark international transactions of Design Engineering Services Division of assessee. The ground of appeal No. 2 raised by the assessee is thus, allowed.
Exclusion of Manufacturing Division - non-allowance of capacity under-utilization in the Manufacturing Division of the assessee - Though the assessee had received support payments from its associated enterprises at ₹ 3.16 crores but it had still suffered losses because of under-utilization of the capacity. The assessee wanted carve out on account of capacity under-utilization. Following the same parity of reasoning as in assessment year 2009-10, we hold that the assessee is entitled to said carve out. Accordingly, we direct the Assessing Officer to allow the capacity under-utilization in the hands of assessee. Secondly, we also hold that there is no merit in the orders of TPO/Assessing Officer in holding that support payments received from associated enterprises should have been to the extent of under-utilization of capacity. Applyingin CIT Vs. Whirlpool [2015 (12) TMI 1188 - DELHI HIGH COURT], we reverse the findings of Assessing Officer/TPO in this regard and delete the addition made in the hands of assessee in the Manufacturing Segment Consequently, the ground of appeal No. 3.1 raised by the assessee is allowed.
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2017 (11) TMI 1974
Seeking grant of Bail - HELD THAT:- It is directed that the respondent shall remain in the custody of Enforcement Directorate till 15th November, 2017. Mr. Grover and Mr. Nanda very fairly accepted that the counsel for the respondent may remain at the visible distance as permissible in law. Be it clarified, that is the singular payer on behalf of the petitioners.
SLP disposed off.
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2017 (11) TMI 1973
Rejection of extension of ‘ED Custody’ remand of the respondent made by the petitioner - HELD THAT:- The trial court has denied further custody remand for sufficient reasons. A careful perusal of the application indicates that primarily the plea taken by the petitioner has been that the respondent did not cooperate in investigation during this nine days period. He gave evasive replies and wasted time by making false allegations that he was beaten by the officials of the petitioner. This can be gathered from the application. This cannot be sufficient enough to keep the accused in ED custody.
Petition dismissed.
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2017 (11) TMI 1972
Seeking direction to the 1st respondent to release the amounts due under the matured Fixed Deposits - Invocation of power of discretionary remedy under Article 226 of the Constitution of India - HELD THAT:- The said issue was considered by a learned Single Judge of this court in W.P.(C) No.18243/2015 filed against the 1st respondent society, in THE CHOONDACHERRY SERVICE CO-OPERATIVE BANK LTD. VERSUS THE MEENACHIL RUBBER MARKETING & PROCESSING CO-OPERATIVE SOCIETY LTD., THE MANAGING COMMITTEE OF THE MEENACHIL RUBBER MARKETING & PROCESSING CO-OPERATIVE SOCIETY LTD. REPRESENTED BY PRESIDENT, KOTTAYAM, THE JOINT REGISTRAR OF CO-OPERATIVE SOCIETIES (GENERAL) , KOTTAYAM [2017 (7) TMI 1403 - KERALA HIGH COURT], and held as per the judgment dated 5.7.2017 that, the nature of the provisions and the regulatory powers conferred on the Registrar under the Cooperative Societies Act and Rules, 1969, makes it clear that, there is no inhibition created in directing to release the matured fixed deposit, and further held that, the writ petition is maintainable against the 1st respondent society.
If the 1st respondent is carrying on with the banking business based on the permission granted by the Registrar of Co-operative Societies, then the public law remedy is available to the petitioner since the banking business is carried on by the 1st respondent under the supervision and control of the Registrar of Co-operative Societies. Even though petitioner has approached the Registrar of Co-operative Societies seeking appropriate directions, no direction was issued. In that view of the matter also, it can be seen that, the writ petition is perfectly maintainable against the 1st respondent society.
The petitioner is entitled to succeed in the writ petitions - petition allowed.
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2017 (11) TMI 1971
Higher rate of depreciation on “Enclosed Withering Trough Machine” - Scope of functional test - this is an energy-saving device and a pollution controlling equipment - AO was of the view that these machines are called Withering Trough Machinery and are required in all tea making factories and are integral part of the factories - HELD THAT:- “Enclosed Withering Trough Machines”, is not comparable with any of the energy-saving devices listed in the New Appendix-I to the Income Tax Rules, 1962. The assessee further claims that “Enclosed Withering Trough Machines”, is pollution control equipment, but he has not specified as to under which item of the New Appendix-I to the Income Tax Rules, 1962, this equipment falls.This claim on the ground that the functional test satisfies the requirement is also to be rejected.
Hence we hold that the assessee failed to substantiate his claim that “Enclosing Withering Trough Machine” is an “energy-saving device” or “pollution control equipment”, which is entitled to higher rate of depreciation. Just because the Assessing Officer had not disturbed this claim of the assessee in the Assessment Year 2012-12, this claim cannot be allowed.
The findings in those cases are that the machines therein fall within this category. We have given a factual finding otherwise. Before us, the assessee has not advanced any arguments on its claim for allowing this expenditure as revenue expenditure. We find that this so called alternative claim is a contradictory claim. The argument is that a machine is fabricated, and it is entitled to depreciation. This means that it is capital expenditure. Just because higher rate of depreciation is not allowed on an asset, it does not lead to a conclusion that the expenditure incurred for acquiring an asset is revenue expenditure. This is an untenable claim. In the result, we uphold the findings of the Assessing Officer on this issue and reverse the order of the ld. CIT(A).
Allowability of depreciation on good-will - claim for allowance of depreciation on the ground that it had acquired intangible assets through this conveyance deed - claim was not made by the assessee in the return of income and was made before the ld. CIT(A) - HELD THAT:- When a registered conveyance deed has been entered into between the two parties and the cost of each asset purchased and sold is specified in that particular deed, then it cannot be altered unilaterally by one party at its convenience. It is not open for the assessee to reduce the cost of land and plantation and reallocate such reduction in cost of tangible fixed asset to an intangible asset and thereafter claim depreciation. Cost of purchase of land and plantation cannot be reduced. The assessee has not filed details as to the cost of which asset has been reduced, so as to enable it to create a new asset called intangible asset/goodwill and thereafter claim depreciation on such asset, for which there is no cost of purchase. All the papers justifying the arriving at of the value of ₹ 325 Lakhs, as the cost of “intangible assets” are self-serving documents. The assessee has neither purchased nor has the seller sold any “intangible asset” in this case. The assessee’s claim that its request to the seller to make such an allocation was rejected by the seller. The vendors were very clear that no intangible property of their is being sold to the company. What was sold intangible property - claim made by the assessee that it incurred the cost to purchase intangible asset is factually incorrect and false. This is a wrong and unjustified claim. It is an indirect way of claiming depreciation on land and plantation which is patently wrong and misleading. Hence, the claim of the depreciation on such intangible asset is devoid of merit.
MAT applicability - Whether Section 115JB of the Act is applicable only when there is no positive total income for the assessee? - HELD THAT:- On a plain reading of this section 115 JB, we are of the considered opinion that the same is attracted whenever the book profit “as calculated under this Section” is in excess of the income computed under the regular provisions of the Act. There is no requirement that the normal profit computed under the act should be a positive figure and that should be payable on the same, in order to attract the special provisions under section 115 JB of the Act. No such requirement is mentioned in this Section. In fact such introspection would defeat the very objection of introduction of this Section.Thus, we uphold the contention of the revenue and allow this ground of the revenue.
Deduction u/s. 80IE which had not been claimed in the return nor any Audit Report has been filed in that regard - HELD THAT:- FAA has not admitted this claim but has held that the assessing officer should have granted the deduction under section 80 IE equal to 100 percent of the profits of Dullabcherra Tea Estate, as the fact that the assessee is eligible for deduction under section 80 IE is not in dispute. How the ld. CIT(A) has come to a conclusion that the fact of the assessee being eligible for claim of deduction u/s 80-IE of the Act and that this fact is not in dispute is not known. There are no basic facts record and no authority has examined the facts and have come to a conclusion that the statutory requirements for claim of deduction u/s 80-IE have been complied by the assessee.
In our view, this finding is perverse. The assessing officer nor the ld. CIT(A), have examined the basic facts or have come to the conclusion that the assessee is eligible for deduction under section 80 IE equal to 100 per cent of the profits for the Dullabcherra Tea Estate. Without doing such an exercise the ld. CIT(A), has directed grant of this deduction. This is bad in law.
Interest subsidy received - capital receipt or revenue received - assessee had acquired “Dullabcherra Tea Estate” and as claimed that the unit “Dullabcherra Tea Estate” received certain interest subsidy, which pertains to a period prior to the acquisition of Dullabcherra Tea Estate - CIT(A), had held that this is interest subsidy and hence a capital receipt - HELD THAT:- This finding of the ld. CIT(A), is not correct. The interest subsidy in question pertains to a period prior to the acquisition of Dullabcherra Tea Estate by the assessee. The ld. Counsel for the assessee submits that, if the claim for refund of this amount of interest subsidy received is made by the former owners of Dullabcherra Tea Estate, then this amount needs to be returned, as it was not factored in computing the purchase price of the estate. In our view, this receipt had accrued during the year and the assessee got the right to receive the interest in this year only, as it is a successor of Dullabcherra Tea Estate. The nature of receipt is not interest subsidy in the hands of the assessee. There is no claim from the vendors of ‘Dullabcherra Teas Estate’ till date on the assessee for return of this amount to them. Hence the receipt is in the revenue field and it has accrued and arisen during the year. Thus this ground of the revenue is allowed.
Allowability of deduction u/s 80 IE - assessee had not claimed deduction under section 80 IE, for this year in the return of income as the gross total income was negative - HELD THAT:- On profits from Dullabcherra Tea Estate, or not has to be examined in the initial assessment year. “Initial Assessment Year” has been defined for the purpose of this section as means the Assessment Year relevant to the previous year in which the undertaking begins the manufacturing or produces articles or things or completes substantial expansions.
Ten consecutive years commence from this initial Assessment Year. The assessee claims that it completed substantial expansion during the Financial Year 2007-08, relevant to the Assessment Year 2008-09. This claim has not been examined by any authority.The assessing officer has not examined this issue in any of the earlier years. The deduction in the 3rd year has been allowed as if the entire facts have been considered in the earlier years.
When no authority has verified the fact as to whether the assessee has complied with the statutory conditions laid down u/s 80IE of the Act, in any of the years, we cannot understand as to how the Assessing Officer decided to allow the claim for the first time in the 3rd year.Assessing Officer has failed to conduct a proper enquiry. CIT(A) has also failed in his duty on this issue.
Thus we set aside this issue to the file of the AO, for fresh adjudication, in accordance with law. The Assessing Officer is directed to examine whether the conditions laid down u/s 80IE of the Act, have complied with by the assessee company in the “Initial Year” and then only come to a conclusion on this issue. We draw strength for this proposition, from the judgement of the Hon’ble Delhi High Court in the case of CIT vs. Delhi Patra Prakashan Ltd[2013 (6) TMI 70 - DELHI HIGH COURT].
Disallowance of club expenses - HELD THAT:- What is to be seen, is as to whether these expenses are incurred for official purposes or personal purposes. If it is incurred for personal purpose, then the same has to be disallowed. Hence this matter is set aside to the file of the assessing officer for fresh adjudication, in accordance with law, after examining the vouchers of club expenses.In the result, this ground of the assessee is allowed for statistical purposes.
Disallowance u/s 14A - HELD THAT:- As decided in WINSOME TEXTILE INDUSTRIES LTD. [2009 (8) TMI 220 - PUNJAB AND HARYANA HIGH COURT] disallowance made u/s 14A, cannot exceed the dividend earned. Keeping in this position of law, we uphold the contention of the assessee and delete this addition made under section 14 A, to the extent of ₹ 63131/-. DMAT charges of ₹ 1433/-, is disallowed by the Assessing Officer twice. Hence the disallowance is deleted as it was a double disallowance.
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2017 (11) TMI 1970
Levy of Interest - duty paid against shortage of goods noticed on the same day of the visit of the officers - levy of personal penalty on the Director and the employee - HELD THAT:- The appellant had immediately paid the entire duty on the shortage of the goods noticed, hence interest is not attracted. Further, the Director in his statement accepted that the goods have been removed without payment of duty, therefore, the Ld. Commissioner (Appeals) has rightly confirmed the penalty on the Director and the employee.
However, considering the overall circumstances of the case, and considering that the appellant company has paid 25% of the penalty imposed, in the interest of justice, the penalty on Director is reduced to ₹ 50,000/- and employee is reduced to ₹ 5,000/-.
Appeal allowed in part.
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2017 (11) TMI 1969
Dishonor of Cheque - insufficiency of funds - mortgage of property - injunction sought to restrain the defendants from dealing with or disposing of or transferring or creating any encumbrance in respect of the property pertaining to the Avani Grand project - equitable right of redemption - Order XXXIX Rule 1(b) of the Code - HELD THAT:- Since the plaintiff has not been able to show in the remotest form any modicum of a claim against the second defendant, no property of the second defendant can be attached in furtherance of the plaintiff's admitted claim against the first defendant and no order of injunction may be issued against any property of the second defendant under Order XXXIX Rule 1(b) of the Code. An order of attachment, as the interlocutory court has rightly found, is a tall order and requires both an unimpeachable claim and the likelihood of such claim remaining unrealised if no order of attachment is passed. An injunction under Order XXXIX Rule 1(b) of the Code requires the plaintiff to demonstrate that he is a creditor of the person whose property is to be affected by the order of injunction. On the material carried to court, the plaintiff does not appear to be a creditor of the second defendant.
It is with considerable regret and diffidence that it needs to be observed that the filter that was traditionally in place before a matter reached the court may have been considerably eroded in value and diluted in its moral content. The judiciary is not a system of a judges alone; the object of the exercise in a court is not to obtain an unworthy order or defeat a worthy cause, the pursuit is of justice - Even though justice cannot be pursued in the adversarial system by ensuring the removal of injustice, the shared responsibility to prevent unjust causes being espoused in court cannot be shrugged off at the Bar. The judiciary cannot stand, far less remain upright, if either pillar of the Bench or the Bar falters.
There comes a time when a system must assert itself, if only to survive against the vicious onslaught of such unscrupulous litigants and their advisors as the present plaintiff. If dockets are not to be clogged with unworthy claims and false defences, litigants who carry vexatious causes must be appropriately dealt with in the award of costs. For the plaintiff's colossal attempt to hoodwink the court and try and obtain an undeserving order, the plaintiff-appellant in this case will pay costs assessed at ₹ 15 lakh each to the second defendant and R-Com - The second defendant and R-Com will be entitled to execute this part of the order in accordance with law.
In view of the submission on behalf of the appellant that it did not seek any order of attachment in respect of Avani Aspires, the order impugned is set aside in such regard - Application disposed off.
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2017 (11) TMI 1968
TDS u/s 195 - Disallowance u/s. 40(a)(i) - non deduction of tax at source on the following payments to Opportunity International, USA (OI) a non-resident non-profit organization - assessee is in second appeal - HELD THAT:- Payments is in respect of services utilized in India and in the nature of FTS. The collateral support is, as explained during hearing, either by way of undertaking or provision of security, enforceable in India, to enable the assessee, a micro finance company, to borrow funds from banks and financial institutions for the purpose of its business. OI Membership is again to enable the assessee to secure the membership of an entity, representing a framework of organizations, i.e., to secure its membership and, thus, the various services and benefits for the conduct of its business in India under its aegis. MIS Emerge fee is again for reporting systems (for micro finance organization and finding solutions), perhaps to be followed as a member. These are clearly in the nature of managerial and technical services falling within the purview of FTS covered u/s. 9(1)(vii).
The decision in G.E India Technology Pvt. Ltd. [2010 (9) TMI 7 - SUPREME COURT] is, in ratio, clearly applicable in the facts of the case, albeit in favour of tax deduction tax at source and, consequently, applicability of s. 40(a)(i), which stands thus rightly invoked. The same, it can be appreciated, does not provide for absolute disallowance, and the assessee could, by remitting the withholding tax, grossing it up, claim deduction for the year of payment. - Decided against assessee.
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2017 (11) TMI 1967
Nature of income - income from sale of Carbon Emission Reduction Certificates (CERs) - ITAT held it as capital income - whether the same was specifically a revenue report and even the assessee has claim benefit u/s 80IA? - HELD THAT:- As decided in M/S. SUBHASH KABINI POWER CORPORATION LIMITED [2016 (5) TMI 793 - KARNATAKA HIGH COURT] When the carbon credit is generated out of environmental concerns, and it is not having the character of trading activity, the Tribunal has rightly held that it is capital receipt and it is not income out of business and hence, not liable to pay income tax. - Decided in favour of the assessee and against the department.
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2017 (11) TMI 1966
Exemption u/s 54 - assessee did not file her return of income - neither the net sale consideration was utilised towards construction of new property nor was the same kept in the Capital Gain Account Scheme - whether claim can be availed only in respect of the entire capital gains utilized within the time prescribed u/s 139(1) and not 139(4)? - HELD THAT:- The assessee has not filed her return of income within the time allotted u/s.139(1) of the Act i.e. 31.07.2010 on the reason that the income of assessee was below the taxable limit. However, the assessee invested the entire consideration in the purchase and construction of a new residential property before the time allotted to file her return of income u/s.139(4).
The argument of ld.D.R is having no merit. The income of assessee, if excluded the capital gain that the impugned amount of addition, is below the taxable income. Being so, the assessee is not liable to file her return u/s.139 of the Act. Since the assessee has invested the impugned amount in construction of a new residential house within the time is allowed u/s.139(4) of the Act, the assessee is entitled u/s.54F - Decided in favour of assessee.
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2017 (11) TMI 1965
Addition being depreciation claimed on civil work of factory building - assessee could not prove the genuineness of the transaction - CIT-A deleted the addition admitting the additional evidence - HELD THAT:- Since, prima facie, the additional evidences submitted by assessee before Ld. first appellate authority were never confronted to Ld. AO and no remand report was called against the same, we remit the matter back to the file of Ld. AO to re-appreciate the contentions of the assessee and decide as per law after affording adequate opportunity of being heard to the assessee. The assessee, in turn, is directed to substantiate his claim in this regard. This ground of revenue’s appeal stands allowed for statistical purposes.
Addition u/s 14A - expenditure incurred on earning the exempt income by invoking provision of section 14A of the I.T.Act read with rule 8D HELD THAT:- We confirm the stand of Ld.CIT(A) firstly because it was noted that own interest free funds of the assessee far exceeded the impugned investments and secondly, no exempt income has been earned by the assessee during the year and hence disallowance u/s 14A was not attracted. These facts are nowhere disputed or controverted by the revenue. Our view is fortified by a recent judgment of Hon’ble Delhi High Court rendered in PCIT Vs. IL&FS Energy Development Co. Ltd. [2017 (8) TMI 732 - DELHI HIGH COURT] where the Hon’ble court has discussed the issue elaborately in the light of statutory provisions and CBDT circular dated 11/05/2014. Thus we dismiss this ground of revenue’s appeal.
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2017 (11) TMI 1964
Rectification of mistake - error apparent on the face of record or not - typographical mistakes in the name of the Financial Creditor as well as in the name of learned counsel appearing on behalf of the Financial Creditor - Section 420 (2) of the Companies Act, 2013 - HELD THAT:- Necessary corrections are made.
Application disposed off.
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2017 (11) TMI 1963
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditor - existence of debt and dispute or not - HELD THAT:- Since an application under section 7 of the Code of 2016 read with Rule 4 of the Rules of 2016 has already been admitted against the CD herein and since further necessary actions which are required to be taken in accordance with Law and Rules framed there-under have already been taken, this authority is of the opinion that the FC herein be directed to approach the IRP, appointed in the aforesaid proceeding for doing needful in accordance with law in regard to the claim of the FC herein.
The FC is asked to approach IRP, appointed by this authority in Dy.No. 529 - present proceedings disposed off.
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2017 (11) TMI 1962
Levy of Excise Duty - base tank - marketable commodity or not - HELD THAT:- It is evident that the appellant was engaged in the manufacturing of the transformers. It also manufactured the base tank, for other company who is also supplied the transformers, on the basis of job work. It cannot be agreed that it has not marketable value - the base tanks has the marketable value and is a product which attracts the excise duty, as per the reasons mentioned by the original authority in its order - the order passed by the lower authority in this regard, need not be interfered.
CENVAT Credit - input - input procured from M/s Dewas Contractor - HELD THAT:- During investigation, it was found that M/s Dewas Contractor was not in the existence so, the claim was denied by the Department - When the payment is made through the cheque then the existence of the firm cannot be denied.
Matter remanded to the original authority to decide this issue (regarding the Cenvat credit) de novo but by providing a reasonable opportunity to the appellant - appeal allowed by way of remand.
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2017 (11) TMI 1961
Classification of goods - Non-cellular Rubber Sheet for heal or Sole or Heal & Sole combined for Footwear - classified under the Tariff Item No. 40082110 of schedule to Central Excise Tariff Act, 1985 or under Tariff Item No. 40082910 - samples were collected for testing and several tests undergone - complete opportunity of presenting the case not provided - principles of natural justice - HELD THAT:- Issue decided in the case of CAPSTAN RUBBER INDIA, CAPSTAN RUBBER INDIA UNIT-II, KATYAL INDUSTRIES & SHAKTI RUBBER CORPORATION VERSUS COMMISSIONER OF CENTRAL EXCISE & SERVICE TAX, AGRA [2016 (12) TMI 1172 - CESTAT ALLAHABAD] where it was held that the principles of natural justice have not been followed by the Original Authorities in these appeals. Therefore, we remand the matter back to the Original Authority who shall given opportunity of presenting their case to the appellants once again and provide opportunity to cross-examine any of the witnesses that appellants desires to cross-examine required for arriving at just and fair conclusion in the matter.
In the present case also, the matter is remanded to the original authority with the similar direction - appeal allowed by way of remand.
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2017 (11) TMI 1960
Seizure of goods - goods was not accompanied by 'e-way' bill which is a necessary requirement - HELD THAT:- It is to be noted that the notification which requires to accompany e-way bill also recites that in case at the time of interception the e-way bill is not present with the goods, the authorities will allow the dealer to download e-way bill and in case the said e-way bill is downloaded then no further action would be taken.
In the present case, it is found that before the seizure could be made on 3.11.2017 at 2:00 p.m. the dealer had already downloaded and produced the e-way bill before the authority at 8:40 p.m. on 2.11.2017. Since the only allegation against the petitioners is of non production of e-way bill, which the petitioners had produced before the authority, the goods and vehicle are directed to be released forthwith upon the petitioners furnishing security, other than cash and bank guarantee, to the satisfaction of the authority concerned.
Petition disposed off.
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2017 (11) TMI 1959
Rectification of mistake - HELD THAT:- As per the earlier tribunal order [2016 (4) TMI 1221 - ITAT BANGALORE] Ground Nos. 14 & 15 were decided and rejected as per Para No. 18 of that tribunal order and in the M. P. order the order was not recalled for fresh decision in respect of Ground Nos. 14 & 15. In view of these facts, there is no merit in this contention that Ground No. 14 & 15 are also to be decided afresh. Therefore, there is no mistake in the tribunal order that the Ground No. 16 is general and it does not require any specific adjudication and this ground was rejected on this basis. The M. P. filed by the assessee is liable to be dismissed as we find no mistake in the tribunal order.
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2017 (11) TMI 1958
Capital gain computation - valuation of land adopted by the AO without directing the AO to refer the matter to DVO - deduction of fair market value as on 01.04.1981 - HELD THAT:- Admittedly during the year under consideration had converted his agricultural land into stock in trade and had also entered into development agreement with the said developer for development of the said project. The first step which, assessee had taken, is conversion of land into stock in trade which is deemed transfer as per Section 45(2) of the Act. However, the capital gains arising on such transfer on conversion of agricultural land into stock in trade, would only arise in the year, in which the said asset i.e. stock in trade is sold or otherwise transferred by him i.e. either asset is sold or developed and thereafter, sold.
In the present case, assessee has entered into a development agreement of said land and as per agreement to receive 37% of the sale receipts as his share. Admittedly, till 31.03.2010, even the municipal sanction of the plans for the said land for development had not been received by assessee or the said developer. Hence, the property i.e. stock in trade was not even ready for development.
CIT(A) referred to the provision of Section 45(2) of the Act but goes on to say, since the assessee has declared income from capital gains, then the same may be assessed in the hands of the assessee. However, such assessment made in the hands of the assessee is against provision of the Act, especially with reference to Section 45(2) of the Act. In view thereof, we find no merit in the findings of CIT(A) in this regard
Deduction u/s. 54B(1) and 54B(2) - Since the assessee would be liable to pay tax on the capital gain only, when the stock in trade is sold or otherwise, transferred by him. Then the question which arises is whether entering into development agreement by the assessee would result in otherwise, transferring of the said land by the assessee. We find no merit in the same and hold that the deemed transfer as envisaged under Section 45(2) of the Act, would arise only when stock in trade is sold or otherwise, transferred by him and not in the year, in which he converted his asset into stock in trade and further, entered into development agreement for development of the said land. There is no merit in the findings of CIT(A) and the assessee’s entitlement for claiming deduction u/s. 54B(1) and 54B(2) of the Act, would be seen in the year, in which the deemed transfer is to be taxed in the hands of the assessee.
Cost of acquisition as on 01.04.1981 in the hands of the assessee while computing long term capital gain on conversion of agricultural land into stock in trade i.e. deemed transfer - In the present facts of the case, Assessing Officer was of the view that value declared as on 01.04.1981 was higher than the value as on that date. In such circumstances, the provision of Section 55A(1) of the Act cannot invoke. In this regard, we find support in the ratio laid down by the Hon'ble Bombay High Court in the case of CIT Vs. Puja Prints [2014 (1) TMI 764 - BOMBAY HIGH COURT] where it was held that no reference could be made u/s. 55A(1) of the Act to determine fair market value of the property as on 01.04.1981, on the ground value declared by assessee was high. The Hon'ble High Court further held that the amendment brought in by Finance Act, 2012 was prospective. Thus, we hold that there is no merit in the stand of Assessing Officer in adopting value in ad-hoc manner. Accordingly, we hold so. Thus, the order of CIT(A) is confirmed on the first issue and is reversed on the second issue. Hence, grounds of appeal of the revenue are partly allowed.
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2017 (11) TMI 1957
Mesne profits - suit for declaration of title and possession, recovery of possession of plaint A and B schedule properties in case the defendants are found in possession of the same, and for perpetual injunction - A relief of mandatory injunction has also been sought for, for directing the defendants to vacate the plaint B schedule property - HELD THAT:- Section 32(c) of the Registration Act, 1908 also deals with power of attorney. There also, it has been specifically stated that it should be a power of attorney executed and authenticated. When Ext. A2 was not executed and authenticated within the meaning of the said provision, that could not have been relied on for permitting the execution and registration of Ext. A3. Moreover, Ext. A2 cannot be said to be a document attested within the meaning of Section 3 of the Transfer of Property Act also.
This is a case wherein even though the plaintiff had agreed in cross-examination that she was ready to examine the executants through video conferencing, the said facility was ultimately not made available. The reason mentioned by the courts below for the same is that the Malaysian Government did not grant permission. The said version is one coming from the mouth of the plaintiff alone, that too, without any documentary evidence. There is absolutely nothing to show that permission was sought for from the Malaysian Government for the said facility and the said facility was denied by the Malaysian Government.
The suit is one for declaration of title and recovery of possession. When the reliefs of declaration and recovery of possession based on title have been sought for, the plaintiff has to stand on her own legs to prove that she has title. The weakness of the defence or the absence of title on the part of the defendants cannot be encashed by the plaintiff to prove the title of the plaintiff. From all the above, this Court is satisfied that both the courts below have gone wrong in decreeing the suit. The impugned judgment and decree passed by the lower appellate court as well as the trial court are liable to be set aside. The suit is only to be dismissed.
In the result, this Regular Second Appeal is allowed and the judgments and decrees passed by both the courts below are set aside. The suit is dismissed. In the nature of the RSA, there is no order as to costs. All pending interlocutory applications in this appeal are closed.
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