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Showing 21 to 40 of 1545 Records
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2017 (2) TMI 1529
Seeking recall of the order - during the course of arguments, full facts were brought to the knowledge of the Bench, or not - HELD THAT:- On perusal of record, it appears that the Tribunal has passed the order on merit where the appellant view was also considered. Regarding the more facts it can be presumed that this is the afterthought. Remedy lies somewhere else.
Hence, when the speaking order was passed on merit, then there are no merit in the application where request is made for recalling of the order - the RoA application is rejected.
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2017 (2) TMI 1528
Reopening of assessment u/s 147 - notice after expiry of four years from the end of the relevant assessment years - HELD THAT:- As per section 147, if the AO has reason to believe that any income chargeable to tax has escaped assessment he may assess or re-assess such income and also any other income chargeable to tax which has escaped assessment and which comes to his notice subsequently in the course of the proceedings provided that where an assessment under sub section (3) of section 143 or section 147 has been made for the relevant assessment year, no action shall be taken u/s 147 after expiry of four years from the end of the relevant assessment years unless any income chargeable to tax has escaped assessment for such assessment year by reason of the failure on the part of the assessee to make a return u/s 139 or in response to notice issued u/s 142 (1) or section 148 or to disclose fully and truly all material facts necessary for his assessment for the assessment year.
We noticed that in the present case the AO has not pointed out any failure on the part of the assessee in making disclosure fully and truly all material facts necessary for the assessment, which is a condition precedent for exercising jurisdiction u/s 147 of the Act.
From the contents of the reasons recorded aforesaid it cannot be inferred that there was any failure on the part of the assessee in disclosing full and true material facts necessary for his assessment for the assessment year under consideration. Hence, we find merit in the contention of the assessee that since there is no failure on the part of the assessee in disclosing all material facts fully and truly, the reopening is bad in law. We, therefore, hold that the action of reopening in this case is not in accordance with the expressed provisions of the Act.
AO has not followed the law laid down by the Hon’ble Supreme Court in GKN Driveshaft India Ltd. [2002 (11) TMI 7 - SUPREME COURT] the reassessment order cannot be passed without passing speaking order on objection filed by the assessee - We notice that the assessee after receiving copy of reasons recorded filed return of income as well as objection of initiation of reassessment proceeding vide letter dated 25.04.2013. But the AO without passing any speaking order on objection filed by the assessee, proceeded further and passed order u/s 143 (3) r.w.s. 147 of the Act. So it is apparent that the AO has not followed the law laid down by the Hon’ble Supreme Court in the aforesaid case.
Subjective satisfaction of the AO to the effect that any taxable income has escape assessment - In Indian and Eastern Newspaper Society [1979 (8) TMI 1 - SUPREME COURT] the Hon’ble Supreme Court has held that audit objection cannot be the basis for reopening of assessment. In view of the facts and circumstances of the case and the law laid down by the Hon’ble Supreme Court and various High Courts, it can be concluded that in the present case the AO has exercised the jurisdiction u/s 147 without his own satisfaction, which is the condition precedent for initiating proceeding u/s 147 if the Act.
We agree with the Ld. Counsel for the assessee that the proceedings u/s 148 cannot be initiated to review the earlier opinion. It is well settled law that when deduction u/s 80 IB (10) was allowed in original assessment after considering all the facts the same cannot be withdrawn by invoking section 147 of the Act. In this case, the AO had allowed the deduction in question in original assessment after considering all the facts and details submitted by the assessee.
Fees paid to Chitnis Vaithy & Co is concerned we notice that the assessee vide letter 18.03.2014 submitted the certificate dated 18.01.2001 issued by the said company TDS Ledger Account, Bank Payment voucher etc. to prove that the said company had provided solicitor for the project of the assessee company, it cannot be said that no tax has been deducted at source.
As regards payment made to M. R. Patil Consulting Engineering Ltd. there is merit in the assessee’s contention of the Ld. counsel that expenditure is allowable in the current year as the assessee has been following the project completion method and since it was allowed in the earlier year the AO cannot change his stand by exercising powers u/s 147 of the Act. As per the settled law assessment cannot be reopened only because of change of the opinion.
Thus we hold that the reassessment proceedings u/s 147 initiated in this case is bad in law. - Decided in favour of assessee.
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2017 (2) TMI 1527
Allocation of sum of Rs. 10 Crores for payment to the affected employees for payment on account of various reasons such as marriage of daughters, ailment, old age disease, payment of loan etc. - Company incorporated under the Companies Act is a juristic person which has a distinct and separate entity or not - Whether the State of Bihar being a sole shareholder of the Boards, Corporations or the Companies incorporated under the Companies Act, 1956 have the responsibility to pay salary and allowances of the employees of the Boards, Corporations and Companies who are unable to pay salary on account of financial constraints? - HELD THAT:- A precedent is a judicial decision containing a principle, which forms an authoritative element termed as ratio decidendi. An interim order which does not finally and conclusively decide an issue cannot be a precedent. Any reasons assigned in support of such non-final interim order containing prima facie findings, are only tentative. Any interim directions issued on the basis of such prima facie findings are temporary arrangements to preserve the status quo till the matter is finally decided, to ensure that the matter does not become either infructuous or a fait accompli before the final hearing.
The resume of the precedents on the issue of the liability of the State Government to pay salary and allowances of the employees of the Boards, Corporations and the Companies of which State is a shareholder and are State within the meaning of Article 12, that there is unanimity that the State Government is not liable to pay salary and allowances as they are separate juristic entity. Therefore, neither in law, as the companies are separate and distinct juristic entity than the State Government, the State cannot be directed to pay salary and wages of the employees of such juristic entity.
The judgments in Kapila Hingorani [2003 (5) TMI 359 - SUPREME COURT] and Kapila Hingorani [2005 (1) TMI 754 - SUPREME COURT] have left the question of liability of the State Government to pay salary and allowances open. The intervention of the Supreme Court was to address humane problem of financial stringency suffered by such employees. Therefore, neither the Kapila Hingorani [2003 (5) TMI 359 - SUPREME COURT] nor Kapila Hingorni [2005 (1) TMI 754 - SUPREME COURT] or Harihar Yadav's case [2013 (11) TMI 1795 - SUPREME COURT] unequivocally holds the State Government responsible for payment of salary and allowances to the employees of the Boards, Corporations and the Companies, if such Boards, Corporations and the Companies are not able to pay salary and allowances due to financial stringency on any ground whatsoever.
Whether there is any final direction on the basis of interim orders passed in Kapila Hingorani [2003 (5) TMI 359 - SUPREME COURT] and Kapila Hingorani [2005 (1) TMI 754 - SUPREME COURT], when the matter was remitted back to this Court to examine the legal issues? - HELD THAT:- In Barak Upatyaka's case [2009 (3) TMI 992 - SUPREME COURT], the Supreme Court has observed that the observations and directions in Kapila Hingorani [2003 (5) TMI 359 - SUPREME COURT] and Kapila Hingorani [2005 (1) TMI 754 - SUPREME COURT] are the interim directions based on tentative reasons and have no value as precedent. Such interim directions were given in extraordinary power under Article 142 of the Constitution - The final order of the Supreme Court is a direction to the High Court to examine the legal issues and that the legal issue requires to be examined by this Court is as to whether the State can be called upon to pay salary and allowances to the workers of the Boards, Corporations and Companies incorporated at one stage by the State Government. Therefore, the issue as to whether the State Government is liable for payment of salary and allowance has been left open by the Supreme Court for appropriate decision by this Court.
Whether the observations made in Kapila Hingorani cases are to address the humane problems faced by certain employees of the Boards and Corporations alone? - HELD THAT:- The observations in Kapila Hingorani (I) and Kapila Hingorani (II) are in fact to address the humane problem as it left the question of liability of the State open - Even in Harihar Yadav's case, the dispute was on account of bifurcation of the State and consequently, the liability of the State of Bihar and Jharkhand but again the problem was addressed as a humane problem.
Whether the judgment in Harihar Yadav's case [2013 (11) TMI 1795 - SUPREME COURT] mandates the State of Bihar to pay salary of the employees of all Boards, Corporations and Companies having huge financial burden and whether such financial burden can be passed on to the State of Bihar when the financial allocation towards the salary and allowances of the Boards, Corporations and Companies is a policy decision in economic matters? - HELD THAT:- There are no merit in the Letters Patent Appeal filed by the writ-applicants bearing L.P.A. No. 1940 of 2015. The learned Single Bench has ordered the State to deposit Rs. 10 crores to meet any financial emergency required by any of the employees is without any mechanism as to how any claim of any of the employees can be examined and paid. It is not found that such direction warrants any interference in the present Letters Patent Appeals as it is to address the humane problem but we direct that Hon'ble Mr. Justice Udai Sinha shall constitute one member Committee to disburse the said amount in accordance with law and the procedure to be devised by him.
Both the Letters Patent Appeals are dismissed.
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2017 (2) TMI 1526
Rejection of books of accounts - NP Profit estimation - A.O. estimated net profit of 7% on gross receipts net of all deductions including depreciation - HELD THAT:- Though, the assessee has maintained katcha books of accounts, which does not give true and correct profit of the business as the assessee has not accounted certain receipts from return trips.
A.O. opined that trading result disclosed by the assessee are not amenable for verification going by the fact that the assessee did not produce regular books of accounts duly supported by documentary evidence such as bills/vouchers for different items of expenditure such as diesel, driver betas, loading & unloading charges and particularly other expenses which contributes major part of the total expenditure for the assessment year under review. A.O. further influenced from the statement of the managing partner deposed an oath at the time of recording sworn deposition dated 5.2.2010 to the effect that the freight receipts others than Raasi Cements are not reflected in the books of accounts. Therefore, we are of the view that the A.O. was right in rejection of books of accounts and estimation of net profit.
NP estimation - We find that the coordinate bench of this Tribunal in the case of ITO Vs. Sri Gundapaneni Nageswara Rao [2014 (5) TMI 344 - ITAT HYDERABAD] under similar set of facts, has directed the A.O. to estimate net profit of 3% net of all deductions including depreciation. Though, there are divergent views from the appellate authorities, the view which is more beneficial to the assessee has to be adopted in view of the Supreme Court, decision in the case of CIT vs. Vegetable Products Limited [1973 (1) TMI 1 - SUPREME COURT]
Therefore, we are of the considered view that since, the assessee has not proved the ownership of assets to claim the depreciation we deem it appropriate to direct the A.O. to estimate net profit of 3% on gross receipts net of all deductions including depreciation. Accordingly, we direct the A.O. to estimate net profit of 3% on gross contract receipts net of all deductions for all the assessment years 2006-07 to 2009-10. Revenue appeal is partly allowed.
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2017 (2) TMI 1525
Application for additional impleadment of Adani Power Rajasthan Limited as a party - HELD THAT:- Issue summons on the suit and notice on the application on appropriate steps by all permissible modes to the three defendants, returnable on 19th April, 2017.
Having heard the learned senior counsel on the prayer for ex-parte ad interim injunction and having gone through the record, bearing in mind the submissions that pursuant to letters of invocations which were issued sometime in January, 2017 for subject bank guarantees No.CPBG No. 0009PR11010027 for Rs. 2,02,55,000/- and CPBG No. 0009PR11010028 for Rs. 13,70,000/- (both issued by defendant No.2) and ABG No. 07551GPER001111 for Rs. 2,10,07,460/-, ABG No. 07551GPER001011 (both issued by defendant No.3), no payment has still been made, it is directed that defendants No.2 and 3 shall not make any payment under the said bank guarantees to the defendant No.1 till next date of hearing subject, however, to the condition that the plaintiff shall be obliged to take all necessary steps to keep the said bank guarantees alive, additional costs incurred for such purpose to be subject to further orders that may be passed in the course of these proceedings.
Compliance of Order 39 Rule 3 shall be made within a week.
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2017 (2) TMI 1524
Principles of natural justice - rejection of prayer of the petitioner to cross-examine the Central Revenue Control Laboratory official on the aspect of nomenclature with regard to the raw material used in the manufacture of carbon black feedstock - HELD THAT:- Whenever there is violation of principles of natural justice, the remedy under Article 226 of the Constitution of India is not closed. In that view of the matter, even though the first order passed by the adjudicating authority has not been challenged, when the respondent authority has reiterated the same in the concluding part of the impugned order, it speaks to the fact that there is non-compliance of principles of natural justice and the petitioner has not been afforded opportunity to cross-examine to make his stand clear and to stand by his defence. Unless the same is brought on record by eliciting in cross examination, further argument, if any, raised, would be a futile exercise.
The writ appeals are partly allowed.
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2017 (2) TMI 1523
Capital gain - Scope and legislative intent of Section 2(47)(ii), (v) and (vi) - JDA entered - essential ingredients for applicability of Section 53A of 1882 Act - Meaning to be assigned to the term “possession” - transfer of land by members of a Cooperative Society by signing an irremovable Power of Attorney in the name of the Developer and also by signing a Joint Development Agreement (JDA) would constitute ‘transfer’ within the meaning of section 2(47)(ii) - taxable capital gains arises from the transaction entered by the assessee - HELD THAT:- As decided in C.S. ATWAL case [2015 (7) TMI 878 - PUNJAB & HARYANA HIGH COURT] parties had agreed for pro-rata transfer of land.No possession had been given by the transferor to the transferee of the entire land in part performance of JDA so as to fall within the domain of Section 53A of 1882 Act.
The possession delivered, if at all, was as a licencee for the development of the property and not in the capacity of a transferee. Further Section 53A of 1882 Act, by incorporation, stood embodied in section 2(47)(v) of the Act and all the essential ingredients of Section 53A of 1882 Act were required to be fulfilled. In the absence of registration of JDA dated 25.02.2007 having been executed after 24.09.2001, the agreement does not fall under Section 53A of 1882 Act and consequently Section 2(47)(v) of the Act does not apply.
The issue of exigibility to capital gains tax having been decided in favour of the assessee, the question of exemption under Section 54F of the Act would not survive any longer and has been rendered academic.The Tribunal and the authorities below were not right in holding the assessee-appellant to be liable to capital gains tax in respect of remaining land for which no consideration had been received and which stood cancelled and incapable of performance at present due to various orders passed by the Supreme Court and the High Court in PILs.
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2017 (2) TMI 1522
Revision u/s 263 - Distinction between “lack of enquiry and inadequate enquiry” - Unexplained deposits in the bank accounts - HELD THAT:- We find that assessee had submitted copy of bank accounts and had also requested Assessing Officer to verify from the banks statements that the money deposited in banks were paid to agents and if the work was not done, the same was returned.
In view of the above facts and circumstance, we find that AO during assessment proceedings had duly verified the entries in the banks statement and therefore had arrived at the conclusion that the deposits represented business transactions and had taken a plausible view and therefore the provisions of section 263 were not applicable.
Provisions of section 263 cannot be invoked to correct each and every type of mistake or error committed by the Assessing Officer. It is only when an order is erroneous that the section will be attracted. Before invoking provisions of section 263 of the Act one has to keep in mind the distinction between “lack of enquiry and inadequate enquiry”. If there was any enquiry, even thought inadequate it would not in itself empower CIT to invoke provisions of section 263 of the Act merely because he had different opinion in the matter. It is only in cases of lack of enquiry that such a course of action would be available to CIT.
Cross objections filed by revenue u/s 253(4) - We find that the AO or assessee on receipt of notice that an appeal against the order of Deputy Commissioner (Appeal) or Commissioner (Appeal) has been preferred by either party and then the other party can file the cross objections. In the present case, the order passed by the CIT u/s 263 has not been passed by Deputy Commissioner (Appeal) or the Commissioner (Appeal) and rather it has been passed by Principal Commissioner and therefore the provisions relating to cross objections as contained in section 253(4) are not applicable and hence, the cross objections filed by revenue are not maintainable.
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2017 (2) TMI 1521
Dishonor of Cheque - prayer is that the sentences awarded to him in 14 different cases for the offence punishable under section 138 of the Negotiable Instruments Act, details of which are being provided in later part of this order, may be ordered to run concurrently - whether the High Court exercising powers under Section 482 Cr.P.C., invoke Section 427 Cr.P.C. and order that sentences awarded in two different cases shall run concurrently? - HELD THAT:- In all the 14 complaints filed against the petitioner, he has been convicted for the offence punishable under section 138 of the N.I. Act and different sentences have been awarded. The maximum sentence awarded to the petitioner is 2 years' simple imprisonment along with fine.
As per sub-section (1) of section 427 CrPC when a person already undergoing a sentence of imprisonment is sentenced on a subsequent conviction to imprisonment, such imprisonment shall commence at the expiration of the imprisonment to which he has been previously sentenced, unless the Court directs that the subsequent sentence shall run concurrently with such previous sentence - the intention of legislature is that even the life convicts have been held entitled to benefit of subsequent sentence, being run concurrently, be it life term or of any lesser term then the different yardstick cannot be applied for those persons, who have been awarded sentence of lesser duration than life unless there are compelling reasons to do so.
There are no compelling reason to order that all the sentences awarded to the petitioner in all 14 cases would run consecutively.
It would not be inconsistent with the administration of criminal justice if the petitioner is allowed the benefit of discretion contained in section 427 of the Code to meet the ends of justice - it is ordered that the substantive sentences awarded to the petitioner in the above referred 14 cases would run concurrently, however, the petitioner will have to serve default sentences as the provisions of section 427 of the CrPC do not permit a direction for concurrent running of substantive sentences with the sentences awarded in default of payment of fine/compensation.
Appeal allowed.
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2017 (2) TMI 1520
Refusal to grant an ad-interim relief in respect of share components of the property owned by the deceased - third party rights would be created in respect of the flat or not - HELD THAT:- The learned Single Judge took into consideration the various facts and circumstances, which had taken place after the demise of Dr. Desai and came to a conclusion that at this stage the question of granting an ad-interim relief in respect of shares does not arise, and kept the matter for final disposal, and a preliminary issue regarding jurisdiction has been decided in favour of the Appellants herein.
Issue regarding the shares - HELD THAT:- It is directed that value of the shares as on the date of demise of Dr. Desai should be protected and the plaintiffs/Appellants would be entitled to get shares valued, not less than their value as on the date of death. In the event, the Appellants succeed, they would be entitled to get the said valuation and/or other reliefs, which are claimed by the them in the suit and in the motion. Hearing of the motion is expedited.
Appeal disposed off.
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2017 (2) TMI 1519
Detention of goods - the contention of the petitioner is that the transaction was genuine and, thus, the subject goods ought not to have been detained - HELD THAT:- Having regard to the facts and circumstances of the case, coupled with the fact, that the petitioner offers to pay one time tax, the subjects goods are directed to be released. Consequently, upon payment of one time tax, by the petitioner, equivalent to the sum of Rs.2,98,013/-, the respondent will, forthwith, release the subject goods to the petitioner.
Petition disposed off.
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2017 (2) TMI 1518
Error in evaluation of answer book - without evaluating the position with regard to availability of vacancy right of other candidate, it is stated that the direction issued by the learned writ Court cannot be implemented in the manner - HELD THAT:- Admittedly, the results of the examinations were declared on 29.8.2013 and thereafter according to petitioner's own showing appointment orders were started to be issued in 2014 itself. The petitioner received the answer-book under the Right to Information Act in December 2013 and at that point of time even before the appointment orders were made the petitioner was of the know in the matter of illegalities committed in evaluating her answer-book. That being so, the question as to what relief could be granted to the petitioner in the light of the delay caused, if any, between December 2013 to May 2015 and the consequential action of the Department in making appointment has not been adverted to by the learned Writ Court while issuing the direction contained in para 12 of the writ petition.
In fact once there was an objection specifically raised in this regard in writing before the learned writ Court, we are of the considered view that this issue should have been addressed by the learned writ Court, even though this issue could be gone into by us, but, in this writ appeal the materials for deciding this issue are not available inasmuch as the effect of preparation of the revised merit list, availability of vacancy, right which had accrued to candidate who has been appointed and adverse effect on their appointment if any are all to be looked into and as the material for deciding these issues are not available in this writ appeal, it thought appropriate to remand the matter back to consider this limited question of granting relief to the petitioner based on the objection for delay raised by the respondent.
The order passed by the learned writ Court in the matter of error in evaluating the answer-book is upheld, but, the matter is remanded back to the learned writ Court to reconsider the question of grating an appropriate relief to the petitioner in the light of the objection raised by the Public Service Commission and the State Government in the matter of delay, if any, caused on the part of the petitioner in seeking the relief - appeal allowed in part.
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2017 (2) TMI 1517
Addition on account of arrears of gratuity and the arrears of leave encashment received from the State Government after retirement - assessee was an employee of the Chaudhary Charan Singh Haryana Agricultural University, Hisar and retired and after retirement, the assessee received arrears of gratuity and claimed the same as exempt u/s 10(10) - Assessee also received a sum on account of arrears of leave encashment which was claimed as exempt u/s 10(10AA)(i) - HELD THAT:- As decided in DHARAM JEET DAHIYA VERSUS INCOME TAX OFFICER, WARD-1, HISAR [2017 (6) TMI 165 - ITAT DELHI] AR submitted that there is not much difference in the language of section 10(10)(i) and 10(10AA)(i) and the view taken in respect of arrears of gratuity u/s 10(10) should be followed for arrears of leave encashment u/s 10(10AA). DR supported this proposition.
As both the sides are consensus ad idem on the position that the view taken in the context of section 10(10) as applicable to leave gratuity be followed here in the context of section 10(10AA) in the context of leave encashment, we are desisting from independently examining the later provision. In view of the fact that held the assessee to be entitled to exemption u/s 10(10)(i) in respect of arrears of gratuity, following the same, extend the benefit of exemption u/s 10(10AA)(i) in respect of arrears of leave encashment. - Decided in favour of assessee.
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2017 (2) TMI 1516
Estimation of GP - estimation of income as per section 145(3) - HELD THAT:- CIT(A) has erred in observing that section 145(3) could not be applied in this case, because, AO could not examine records as these accounts were not produced before him. In our opinion section 145(3) contemplates that the AO can resort to estimate the income, if he is unable to deduce true result from the accounts or other details. Strictly, books were not produced before the AO, and it was not rejection of books as such, but impliedly it is estimation of income as per section 145(3) of the Act.
CIT(A) has not considered any of these aspects, viz. why there is a decline in GP, why assessee does not want to scrutinise its books of accounts from the AO. Therefore, considering all these aspects, we are of the view that the order of the CIT(A) is not sustainable. Total addition cannot be deleted. As observed in the foregoing paragraphs that income even after rejection of books can be estimated on some guess work. It is to be estimated keeping in view surrounding facts and circumstances. In the present case, the assessee herself has shown GP at 4.21% in the immediately preceding year.
AO ought to have adopted GP nearby this figure and not at 20%. The assessee in her submission before the ld.CIT(A) has expressed the rate of at 4.25%. Thus, taking into consideration written submissions filed by the assessee before the ld.CIT(A) and other material, we deem it appropriate that ends of justice would be met, if the gross profit is being calculated at the rate of 5.5% (five point five percent) of the total turnover. With the above observation, order of the ld.CIT(A) is set aside and the AO is directed to recalculate the addition by applying GP at 5.5% (five point five percent) of the total turnover. The appeal of the Revenue is partly allowed for statistical purpose.
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2017 (2) TMI 1515
Penalty u/s 271C - treated the appellant as defaulter u/s.194A/201(1) - HELD THAT:- Issue decided in favour of assessee as interest is awarded by the court for loss suffered on account of deprivation of property or paid for breach of contract by means of damages or were not paid in respect of any debt incurred or money borrowed, shall not attract the provisions of Section 2(28A) read with Section 194A(1). See SAHIB CHITS (DELHI) (PVT.) LTD. [2009 (7) TMI 75 - DELHI HIGH COURT], CHIRANJI LAL MULTANI MAL RAI BAHADUR PVT. LIMITED [1988 (12) TMI 62 - PUNJAB AND HARYANA HIGH COURT]
Also in case of New India Assurance Co. Ltd [2016 (9) TMI 451 - GUJARAT HIGH COURT] insurance company was not justified in deducting tax at source while depositing the compensation in favour of the claimants. It therefore, cannot avoid liability of depositing such amount with the Claims Tribunal. The Claims Tribunal had committed no error in insisting on the insurance company in making good the shortfall - Decided in favour of assessee.
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2017 (2) TMI 1514
Income deemed to accrue or arise in India - Taxability of amount received - PE in India - HELD THAT:- Questions urged in this appeal are covered by the decision of this Court for the previous assessment years, titled as National Petroleum Construction Company Vs. Director of Income Tax (International Taxation)[2016 (2) TMI 47 - DELHI HIGH COURT]
Applicability of Section 234B relates to the Revenue’s contentions that interest was payable in respect of non-payment of advance tax - HELD THAT:- ITAT relied upon the judgment of this Court in Director of Income Tax (International Transactions) v. G.E. Packaged Power [2015 (1) TMI 1168 - DELHI HIGH COURT] where the Court held that the primary liability of deducting the tax for the period concerned is that of the payer. In the facts of the present case, the appellant was the payee and not the payer who could not, therefore, be passing the liability under the terms of the Act.In view of the fact that the ITAT followed the judgment of this Court, no substantial question of law arises
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2017 (2) TMI 1513
Rejection of books of accounts - gross profit estimation - no item wise information on stock of jewellery given - As per DR GP rate of 30% applied by the AO was correct since it was based on GP ratio shown by comparable cases - HELD THAT:- As gone through the order of Vivek Jain Prop. Vijay Jewellers [2016 (11) TMI 1714 - ITAT CHANDIGARH] wherein I.T.A.T. held that in view of the nature of business carried out by the assessee and the trading of items as per customer’s preference the FIFO method could not be applied as suggested by the Assessing Officer. The Hon'ble I.T.A.T., therefore, held that the rejection of books of account was incorrect and addition made on account of estimation of gross profit was, therefore, set aside.
In the present case, we find that the basis for rejection of books is similar to that in the case of Vivek Jain Prop. Vijay Jewellers (supra) being that item-wise information of stock of jewellery had not been furnished by the assessee.
Merely because item-wise details were not maintained, it could not be said that the books did not disclose true result of the assessee. The Ld. CIT (Appeals), we find, correctly held that no specific defect has been pointed out by the Assessing Officer by bringing on record any adverse material. Further, undisputedly, the books of account of the assessee were duly audited and there is no finding to the effect that the assessee had inflated the cost of raw material or cost of processing or that he had made sales outside the books or that the sale price were suppressed. The assumption of the Assessing Officer was clearly therefore sans documentary proof. The Ld. CIT (Appeals) has also given finding of fact that the gross profit rate shown by the assessee is progressive having increased from 12.48% in the preceding year to 14.30% in the year under consideration. In view of the same, we agree with the Ld. CIT (Appeals) that there is no reason at all to reject the books of account of the assessee and estimate the gross profit. - Decided against revenue.
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2017 (2) TMI 1512
Income derived from ‘income from business’ or ‘income from other sources’ - allowing only 2% of the expenditure on adhoc basis - HELD THAT:- It is a fact that the assessee had not carried out any Segment I business activity i.e. incubation of new entities during the year under appeal. It had only carried out Segment II business activities during the year under appeal. The various streams of income derived from Segment II business activities were stated elsewhere hereinabove in this order. This fact was lost sight by the lower authorities and the findings given by the appellate forums in earlier years were simply copy pasted while disposing off the appeal for the year under appeal.
We hold that the allowability of various expenses claimed by the assessee in its profit and loss account should have to be adjudicated based on the findings to be given with regard to the various streams of income in the form of shared services / infrastructure services etc by the lower authorities and the head of income thereon.
AO would have to go through all the relevant agreements entered into by the assessee and give a finding as to whether the same would fall within the objects of the assessee trust so as to fall within the ambit of business income of the assessee. In case if the same is to be construed as income from other sources, even then the allowability of the various expenses would have to be considered in the light of the provisions of section 57(iii) of the Act. We agree with the arguments of the ld AR that the findings given in the earlier years with regard to incubation of new entities does not apply to the facts during the year under appeal.
We hold that the lower authorities had not adjudicated the various streams of income in the correct perspective for the year under appeal. Accordingly, we deem it fit and appropriate, in the interest of justice and fair play, to set aside the entire assessment to the file of the ld AO for denovo adjudication, in accordance with law. Needless to mention that the assessee be given reasonable opportunity of being heard. Accordingly the grounds raised by the assessee are allowed for statistical purposes.
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2017 (2) TMI 1511
Exemption u/s 11 - Registration u/s 12AA - amendment to sec 12A(2) - Retrospectivity - scope of amendment made in section 12A vide Finance (No.2) Act, 2014 the Income Tax Act - HELD THAT:- As decided in ST. JUDE'S CONVENT SCHOOL AND OTHERS [2016 (9) TMI 1382 - ITAT AMRITSAR] The first proviso to section 12A(2) of the Act is applicable retrospectively. Likewise, for the same reasoning, it is also held, regarding the second batch of appeals, that even the second proviso to Section 12A(2) is retrospective in nature and the completed assessments in these cases ought not to have been reopened only for non-registration for the relevant assessment years. - Decided in favour of assessee.
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2017 (2) TMI 1510
Maintainability of prosecution - Food Adulteration - Parachute coconut oil manufactured by the Marico Industries Limited, Mumbai found to be adulterated - offences punishable under Sections 2(ia)(e) punishable under Section 7(i) and 16(1)(a) of Prevention of Food Adulteration Act - HELD THAT:- As the Marico Industries Limited, Mumbai has not been arraigned as an accused, therefore, the prosecution of the applicant in his official capacity is not permissible because he cannot be vicariously held liable for the offence committed by the Company unless and until, the Company which is a juristic entity is arraigned as an accused.
Petition allowed.
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