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Showing 1 to 20 of 1954 Records
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2018 (11) TMI 1958
Revision u/s 263 against reopening of assessment - Estimation on income on bogus purchases - HELD THAT:- We find from the records that while passing order u/s 143(3) r.w.s. 147 of the I.T. Act, the AO has considered the factual position with regard to making purchases from different persons.
From the records, we found that completed assessment was reopened on the ground of information from the investigation wing that assessee had made purchases from alleged bogus supplier. Since the reopening itself was for this purpose only the AO after having detailed inquiry and investigation found that corresponding sales have been duly accounted for in the books, accordingly entire purchases could not be added and he estimated extra profit of 6% on such purchases and added the same in assessee’s income.
We are of the considered view that order passed by Ld. CIT u/s 263 of IT. Act is not correct as Ld. CIT has not discussed the factual details passed in the order in the case of N. K. Proteins Ltd. [2017 (1) TMI 1090 - SC ORDER] and N.K. Industries [2016 (6) TMI 1139 - GUJARAT HIGH COURT], wherein in these cases, 100% of additions were made. Therefore in the case of the assessee, AO had not made 100% addition, whereas after going through the aforementioned different orders passed by different courts, had made additions @ 6%.
We have also considered the various decisions of the judicial authorities, wherein under identical facts and circumstances, 2% additions on bogus purchases were made. Since the additions in such type of case depend on the facts of each case, therefore provisions of section 263 could not have been invoked by the Ld. CIT. Decided in favour of assessee.
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2018 (11) TMI 1957
Benefit of Section 10A and 10B - Interest on fixed profit - Whether the interest received and the consideration received by sale of import entitlement is to be construed as income of the business of the undertaking? - HELD THAT:- Substantial question of law that arises for consideration in the instant appeal has been covered by the Division Bench judgment of this Court in the case of COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE VS. MOTOROLA INDIA ELECTRONICS PRIVATE LIMITED [2014 (1) TMI 1235 - KARNATAKA HIGH COURT]
The submission of the learned counsel for the appellants is placed on record. The appeal is accordingly dismissed.
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2018 (11) TMI 1956
Rejection of application for impleadment of Director of Respondent as a party - Section 424 of the Companies Act, 2013 - HELD THAT:- What comes to fore from record is that the Appellants primarily sought impleadment of Mr. Pranav Patwardhan as party respondent on the score that such appointment was illegal and documents were fabricated to file statutory compliances while other reliefs claimed were consequential. This factual position stares in the face of Appellants who cannot wriggle out of the same. Even the Memo of Appeal incorporates this factual position. The impleadment was sought on the ground that such appointment was violative of Section 161 of the Companies Act, 2013. The Tribunal took cognizance of the fact that Mr. Pranav Patwardhan had already resigned from the post of Additional Director on 16th January, 2018. The factum and validity of such resignation has not been questioned by the Appellants.
Infraction of the Articles of Association of the Company or provisions of Companies Act in this regard cannot be attributed to Mr. Pranav Patwardhan who is neither a necessary party nor a proper party for being impleaded as party respondent, more so as he has admittedly tendered resignation on 16th January, 2018 and ceased to be a member of the Board of Directors.
There being no legal infirmity in the impugned order, the appeal merits dismissal - Appeal dismissed.
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2018 (11) TMI 1955
Grant of Default bail - smuggling of contraband - presentation of report under Section 173(2) Cr.P.C. by the police without the report of Chemical examiner/Forensic Science Laboratory amounts to incomplete challan or not - absence of any extension of time under Section 36-A(4) of the N.D.P.S. Act - HELD THAT:- When a report is submitted by the police to the Magistrate, he ought to apply his mind to see whether it discloses the commission of an offence, so as to enable it to subject the accused to the rigors of a trial - What would also necessarily flow from this, would be a prima facie opinion by the Court of the commission of an offence which under the N.D.P.S. Act would revolve around establishing the posession of contraband, its nature, content and extent.
With respect to the question posed by the learned Single Judge regarding some of the contraband being identifiable through naked eye, inspection based on experience and knowledge, would be a great fallacy and we would respectfully state that it would be grossly unsafe to rely upon such an opinion based on naked eye inspection backed by experience or knowledge to arrive at a prima facie opinion of the commission of an offence to submit an accused to the rigors of trial by the Magistrate in the exercise of its powers under Section 190 Cr.P.C. - Non-inclusion of the Chemical Examiner's opinion in the report under Section 173 Cr.P.C. would expose the accused to unfounded dangers imperiling and endangering his liberty since the provisions of the N.D.P.S. Act in its applicability to a trial and conclusion are stringent in consequence.
Thus, it is essential that the report of the Chemical Examiner be included in the report under Section 173 Cr.P.C. and without which it can at best be termed to be an incomplete challan depriving the Magistrate of relevant material take cognizance and if it is not submitted within the requisite period of 180 days, it would essentially result in a default benefit to the accused unless an application is moved by the Investigating Agency apprising the Court of status of investigation with a prayer for extension of time to the satisfaction of the Court.
The State should also sensitize their Investigation Officers to make an application for extension of time to submit the report in the prescribed period so as to obviate any chances of an accused getting benefit of the default clause.
Reference disposed off - List all the cases before Single Bench appropriately as per roster.
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2018 (11) TMI 1954
Registration of petitioner firm as transporter and handler of the agricultural produce - denying the registration of the firm on account of not getting the balance-sheets audited by Income Tax Department for last three years - Non-considering the bid of the petitioner for the purpose of empanelment - Counsel submitted that the requirement of having the turnover of 1.5 Crore in last 3 financial years is fulfilled by the petitioner-firm and only on account of audit not being carried out, the respondents have acted arbitrarily in rejecting the empanelment of the petitioner-firm.
HELD THAT:- Requirement of audit of accounts is to be governed by the provisions contained in Section 44AB of the Income Tax Act, 1961 and if the turnover/sale/gross receipts in business does not exceed one crore rupees in any previous year, there is no requirement of getting the accounts audited.
This Court further finds that the requirement as per Condition No. 5 was to consider the turnover for last three years of Rs. 1.50 Crore and if the petitioner-firm had the turnover in last three years of 1.50 Crore, the same could not be related to the condition of audited balance-sheets.
The plea of the respondents that even if the turnover is less than One Crore but it exceeds to 1.50 Crore in the last three years, the same is required to be audited, this Court finds no substance in the arguments raised by counsel for the respondents, as it runs contrary to the requirement of Section 44 (A)(B) of the Income Tax Act, 1961.
This Court finds that if the procuring entity prescribes a condition to be fulfilled by the bidder, such condition had to be in consonance with the requirement of law. The Income Tax Act, 1961 has prescribed the minimum turnover for getting the accounts audited, the procuring authority cannot interprete and put such a condition to insist upon getting the accounts audited even if some assessee/businessmen who has a turnover of less than one crore in a particular year.
This Court finds little substance in the submission of the learned counsel for the respondents that the action taken by the respondents is perfectly legal and justified. The respondents while considering the bid submitted by different eligible bidders was required to consider the condition which was prescribed in the tender and also to fulfill the requirement of compliance of relevant law as well.
This Court finds that non inclusion of name of the petitioner-firm on account of not having the audited balance-sheets is not justified and respondents have committed illegality in rejecting the bid of the petitioner-firm.
Accordingly, the present writ petition succeeds and is hereby allowed. The respondents are directed to consider the bid of the petitioner for the purpose of empanelment and it should not be rejected on the ground of not having audited balance-sheets of last three years.
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2018 (11) TMI 1953
Validity of reopening of assessment - it was the AIR information, which formed the basis of the AO’s belief of escapement of income of the assessee - unexplained cash deposits in the savings bank account of the assessee - HELD THAT:- In ‘Bir Bahadur Singh Sijwali case [2015 (2) TMI 60 - ITAT DELHI] like in the present case, the reasons recorded indicated that cash deposits had been made in the bank account of the assessee. The Tribunal held that the mere factum of deposits having been made in a bank account does not indicate that these deposits constitute an income which has escaped assessment. As observed that the reasons recorded did not make out a case that the assessee was engaged in some business and the income from such a business had not been returned by the assessee.
In the case at hand also, the reasons recorded do not contain any such recital. The Tribunal held that the factum per se, of deposits in the bank account of the assessee could not be made the basis for holding the view that income had escaped assessment, overlooking that the sources of the deposits need not necessarily be the income of the assessee; and that as such, the reasons recorded were not sufficient to believe escapement of income; that rather, they were reasons to suspect escapement of income, which was not enough for issuance of a notice u/s 148 of the Act.
The reasons recorded by the AO for issuance of notice u/s 148 of the Act are held to be invalid, being reasons not sufficient to form belief of escapement of income, based on vague information. All proceedings pursuant thereto are thus annulled and cancelled. Assessee appeal allowed.
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2018 (11) TMI 1952
Termination for involving in moral turpitude - forfeiture of gratuity - Imposition of penalty of compulsory retirement on the Appellant consequent to the findings returned by the Inquiry Officer - whether the penalty inflicted was not proportionate to the misconduct? - HELD THAT:- In the facts of the present case, while it is not in issue that consequent upon the order of the Disciplinary Authority, the CBI registered a case on 28th September 2016 against the Appellant and certain others for the aforementioned offences under the IPC and the PC Act, that case has as of now progressed only to the stage of filing of the charge sheet. The criminal court concerned will hereafter apply its mind to the contents of said charge sheet and pass an order on charge. The progress of the criminal case will depend on whether charges are framed against the Appellant; whether he is sent up for trial on those charges; whether he is convicted for the offences with which he is charged and whether such conviction attains finality. A further question would then arise as to whether the offences for which the Appellant is ultimately convicted would involve moral turpitude, as is mentioned in sub-clause (ii) of Section 4(6)(b) PG Act.
Therefore, at this stage, it would be premature for the respondent-Bank to conclude that the acts for which the Appellant's services were terminated constitute offences involving moral turpitude.
The decision in C.G. Ajay Babu [2018 (8) TMI 934 - SUPREME COURT], therefore, clearly explains that the action of forfeiting the gratuity payable to an employee cannot be taken at the stage when there is no final determination that such acts of the employee in fact constitute an offence involving moral turpitude. That determination can only be made by a criminal court and, thereafter, that determination must attain finality.
The net result, as far as the present case is concerned, is that the impugned decision of the respondent-Bank in forfeiting the entire gratuity of the Appellant was premature and could not have been taken at the stage at which it was, i.e. even before the determination by a criminal court that the act committed by the Appellant constituted an offence involving moral turpitude.
The impugned order of the learned Single Judge of this Court dated 9th March 2018 and, consequently, the order of the respondent-Bank dated 15th February 2017 by which the entire amount of gratuity payable to the Appellant was forfeited under Section 4(6)(b) of the PG Act are hereby set aside - gratuity amount withheld shall now be released to the Appellant by the Respondent no later than four weeks from today - Appeal disposed off.
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2018 (11) TMI 1951
Enhancement of retirement age of the respondent to 65 years - HELD THAT:- The retirement age of the respondent-who is a dental surgeon and was serving as Staff Surgeon in Non-Functional selection grade under the Ministry of Health and Family Welfare, was 60 years. He was aggrieved by the fact that though the Central Government had raised the retirement age of Allopathic doctors (General Duty Medical Officers(GDMOs)) of the Central Health Service (CHS) vide order dated 31.05.2016 to 65 years, the age of retirement of the respondent was not similarly raised and it continued to remain as 60 years.
Since the Government itself has subsequently raised the retirement age of dental doctors to 65 years, there is no justification to deny the said relief to the respondent. Therefore, without going into the merits of the arguments sought to be advanced by the Union of India, on equitable considerations, the impugned order is not interfered in exercise of discretionary jurisdiction under Article 226 of the Constitution of India.
In case the respondent continued to serve the petitioner even after attaining the age of 60 years, and he continues to do so, the petitioner is directed to make payment of arrears of salary and allowances to the respondent within four weeks from today, and to continue to pay his salary and other allowances in future till the respondent superannuates at the age of 65 years. However, it is made clear that the respondent shall not be assigned any administrative duties in terms of the Governmental decision.
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2018 (11) TMI 1950
Extension of retirement age - HELD THAT:- Even though the Government of India initially did not extend its policy decision to enhance the retirement age of allopathic doctors to other medical streams, such as Ayurvedic doctors subsequently, it has taken the decision on 24.11.2017 to enhance the age of retirement of those doctors who are covered by AYUSH (which includes the Ayurvedic doctors, as well as those practising Unani, Homeopathy etc.) The subsequent decision dated 24.11.2017 has been made effective only from 27.09.2017. Pertinently, the NDMC has followed suit, and the said Governmental decision has been adopted by it. Thus, those Ayurvedic doctors of the NDMC who fall in the window before 31.05.2016 and 26.09.2017 are left out from getting the benefit of the enhancement of age of retirement, while those retiring on or after 27.09.2017 would get the benefit of the retirement age enhancement to 65 years.
Those Ayurvedic doctors, who continued to remain in service on or after 27.09.2017, have been extended the benefit of their age of retirement being raised like the other Allopathic doctors (GDMOs) to 65 years. Qua the said private respondents, the present petitions are accordingly dismissed.
So far as the case of respondent No.2 Dr. Pratibha Sharma in WP(C) 8704 of 2017 is concerned, it is found that she is an employee of EDMC and apparently the EDMC has not adopted the Government Resolution dated 24.11.2017. The present petition has been preferred by the NDMC. Therefore, in the present petition, respondent No.2 Dr. Pratibha Sharma need not have been impleaded as a party respondent, since the NDMC has no concern with her - it is left open to the EDMC to deal with her case in the manner it considers appropriate.
The NDMC is directed to make payment of the arrears of salary and allowances to those of the respondent-doctors, who continued to serve with the NDMC even after attaining the age of 60 years and who are still in employment with NDMC, within four weeks from today and to continue to make payment of their salary and other allowances in future punctually till they superannuate at the age of 65 years. However, it is made clear that respondents shall not be assigned any administrative duties in terms of the Governmental decision.
Petition dismissed.
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2018 (11) TMI 1949
Disallowance u/s 14A r.w.r.8D - expenditure attributable to earning of exempt income - HELD THAT:- As could be seen from the facts on record, in the preceding assessment year the assessee contested the disallowance made u/s 14A of the Act r/w rule 8D on the plea that the investment in shares, etc., having been held as stock–in–trade no disallowance can be made under section 14A of the Act. However, while deciding the aforesaid claim of the assessee in assessment year 2011–12, vide [2018 (5) TMI 2167 - ITAT MUMBAI] the Tribunal has restored the issue to the Assessing Officer for fresh adjudication.
In view of the above, we direct the Assessing Officer to decide the issue following the direction of the Tribunal in assessment year 2011–12 (supra) as well as the additional submissions made by the assessee in the impugned assessment year. While doing so, he must keep in view the ratio laid down in the decisions to be cited by the assessee. Needless to mention, before deciding the issue, the Assessing Officer must afford reasonable opportunity of being heard to the assessee. Accordingly, we restore the issue to the Assessing Officer for de novo adjudication. Ground is allowed for statistical purposes.
Nature of expenses - Amortization of lease premium - AO after verifying the details available on record found that the aforesaid amount was paid on account of lease premium on various lease hold lands held by the assessee and concluded that it is in the nature of a capital expenditure - HELD THAT:- As could be seen, the claim of amortization of lease premium on lease hold land is a recurring dispute between the assessee and the Department from the preceding assessment year. While deciding the disputed issue in assessee’s own case for assessment year 2004–05 [2017 (7) TMI 1289 - ITAT MUMBAI] in ITA no.5977/Mum./2011, dated 26th July 2007, the Tribunal upheld the disallowance made by the Assessing Officer. The same view was reiterated by the Tribunal while deciding assessee’s appeal in ITA no.[2018 (5) TMI 2167 - ITAT MUMBAI] 4491/Mum./2016, dated 25th May 2018, for assessment year 2011–12. Respectfully following the consistent view of the Tribunal on the disputed issue in assessee’s own case as referred to above, we uphold the disallowance made by the Assessing Officer. Ground raised is dismissed.
Taxing the income of foreign branches - AO held that any income of a resident of India though may be taxed in other country, however, such income shall be included in his total income chargeable to tax in India and relief shall be granted for elimination of double taxation as provided in the relevant DTAA, thus included the income of the foreign branches in the total income of the assessee - HELD THAT:- The issue has to be decided keeping in view the provision of section 90(3) read with Central Govt. notification no S.O. 2123(E) dated 28th August 2008 as well as the decisions cited by learned Departmental Representative. However, it needs to be observed, the submissions made by the assessee before us against the applicability of the decisions of Essar Oil Ltd. [2013 (9) TMI 126 - ITAT MUMBAI] and Bank of Baroda Ltd. [2014 (7) TMI 1185 - ITAT MUMBAI] appears to have not been made before the Departmental Authorities, may be for the reason that the assessee thought the issue to be covered by the decisions of the Higher Appellate Authority in its own case in the preceding assessment years.
Therefore, assessee deserves an opportunity to establish its case before the Departmental Authorities that the income of the foreign branches are not includible in the income chargeable to tax in India notwithstanding the Central Government notification no.S.O. 2123(E) dated 28th August 2008 r/w section 90(3) of the Act as well as the decisions cited supra - Accordingly, we restore the issue to the Assessing Officer for de novo adjudication after due opportunity of being heard to the assessee. This ground is allowed for statistical purposes.
Disallowance on account broken period interest paid on Government and other approved securities purchased during financial year 2011–12 - HELD THAT:- As could be seen, identical issue came up for consideration before the Tribunal in assessee’s own case for assessment year 2011–12, [2018 (5) TMI 2167 - ITAT MUMBAI] as held reasoning of the Departmental Authorities do not stand to reason. If the assessee is consistently following an accounting method as per which the broken period interest is offered as income when it is received, the broken interest paid while purchasing the securities cannot be disallowed merely on the reasoning that the assessee is not showing the broken period interest income on accrual basis.
As could be seen, the Hon'ble Jurisdictional High Court in case of State Bank of India, [2016 (8) TMI 963 - BOMBAY HIGH COURT] after following the decision of the said Court in case of American Express International Corporation [2002 (9) TMI 96 - BOMBAY HIGH COURT] has rejected Revenue’s appeal against allowance of assessee’s claim of deduction in respect of broken period interest paid. While doing so, the Hon'ble High Court has also upheld the decision of the Tribunal in holding that the broken period interest income has to be taxed on due basis instead of accrual basis. It is evident, the aforesaid decision of the Hon'ble Jurisdictional High Court was neither referred to nor examined by the Departmental Authorities while deciding the issue. We restore the issue to the Assessing Officer for deciding afresh.
MAT applicability u/s 115JB - As per the provisions of section 115JB of the Act applicable to the relevant assessment year, it cannot be extended to Banking companies.
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2018 (11) TMI 1948
Validity of assessment order passed u/s 144 r.w.s. 153C - as argued no proper satisfaction was recorded before issuing the said notice - HELD THAT:- Since the assessment order is silent about recording of satisfaction or handing over of satisfaction note by the AO of searched person to the AO of assessee, then it was incumbent upon the Department to prove its case of having jurisdiction under section 153C of the Act i.e. to produce satisfaction note of the AO incharge of the searched person, pursuant to which documents were handed over to the AO of assessee and proceedings were initiated under section 153C of the Act.
Despite several opportunities being allowed to Revenue, satisfaction note and the assessment records could not be produced, though efforts were made but on the ground that records are very old, the same cannot be produced. But this cannot be taken as ground for allowing the claim of Department. The onus was upon the Revenue to prove its case that proper satisfaction was recorded by the AO incharge of the searched person before handing over the documents to the Assessing Officer of the assessee and for non production of such satisfaction note and non mentioning of satisfaction note in the assessment order, vitiates the assessment order passed in the case of assessee under section 143(3) r.w.s. 153C of the Act. Hence, the same is held to be invalid and bad in law. Appeal of assessee allowed.
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2018 (11) TMI 1947
Smuggling - betel Nuts - country of origin - notified goods under Section 123 of the Customs Act and onus to prove - HELD THAT:- It is noted that the reliance on the opinion of Arecanut Research & Development Foundation (ARDF), Mangalore as regards the country of origin by the Original Adjudicating Authority was not proper inasmuch as the said organization in reply to an RTI query has stated that it is not possible to determine the place of origin of betel nuts through test in laboratory - even if the betel nuts are held to be of foreign origin, the same can be confiscated only when it is proved that betel nuts has been illegally smuggled into the country. Revenue has not produced any evidence to show that the betel nuts in question were smuggled into India.
In the absence of any positive evidence to establish the foreign origin of the goods and their illegal smuggling into the country, the Appellate Authority is agreed upon that their confiscation is neither warranted nor justified. As such, there are no infirmity in the impugned order of the Commissioner (Appeals).
Accordingly, Revenue’s appeal is rejected.
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2018 (11) TMI 1946
TP Adjustment - treating trade receivables as outstanding from the Associated Enterprises ("AE"), as an international transaction and recharacterizing the same as loan - AO / DRP / TPO arbitrarily adopting 13.46% as the rate of interest - HELD THAT:- It has to be worked out as to how much amount was received beyond the agreed credit period by the assessee from its AE and the same should be considered as a separate international transactions and appropriate interest on that account should be brought to tax in the present case as TP adjustment.
The working given by the ld. AR of assessee in this regard is placed on record but this working is only in respect of debtors as on 31.03.2011 but if the debts are already liquidated during the year but the receipt was after expiry of agreed credit period then the amount of such realization during the present year beyond the agreed credit period should also be considered for this purpose.
Hence on this issue, we restore the matter back to the file of AO/TPO for fresh decision by examining the agreement between the assessee and its AE in respect of agreed credit period because as per the agreement dated 01.10.2010 only those receivables are covered which are arising after this date but in respect of those receivables which has arisen before 01.10.2010 if any, there must be some other agreement which may contain different credit period terms and therefore, such agreement should also be examined and those receivables are also be examined which are already liquidated in the present year because even if payments were already received from the AE in the present year itself, it has to be seen as to whether such payment received from the AE in the present year are received within agreed credit period or beyond it and the total delayed payment received or not received up to 31.03.2011 should be worked out for the purpose of this TP adjustment.
Rate of interest to be adopted for working out interest on such delayed payment from AE - We find that in Assessment Year 2014-15, as per its order dated 30.10.2017, the TPO himself has adopted the interest rate using LIBOR- 6 months + 400 basis points and the same was worked out at 4.3836% for Financial Year 2013-14. In our considered opinion, the same basis of LIBOR – 6 months + 400 basis points as applicable for Financial Year 2010-11 should be considered in the present case also. We hold accordingly. The AO/TPO is directed to work out the TP adjustment on this account at the rate of 6 months LIBOR + 400 basis points for the relevant Financial Year i.e. Financial Year 2010-11 on the total amount received or receivable by the assessee from its AE beyond the agreed credit period considering the actual delay in number of days. These two grounds are decided accordingly.
These two grounds are partly allowed for statistical purposes.
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2018 (11) TMI 1945
Suo-moto revision - Reopening of assessment - reopening of assessment on the ground of short levy of Tax on Aluminium Composite Panel, which was liable to be taxed under residuary entry @ 12.5% - it was held by HC GOLDIE GLASS INDUSTRIES VERSUS STATE OF M.P. AND OTHERS [2017 (8) TMI 1451 - MADHYA PRADESH HIGH COURT] that the order passed by the Dy. Commissioner of Commercial Tax (Appeal) is final and is not amenable to suo-motu revisional powers conferred by Section 47 of the Act.
HELD THAT:- Sole respondent has not filed counter affidavit, despite last opportunity having been granted. Further opportunity is declined.
Registry to process the matters for listing before the Hon'ble Court after completion of period of four weeks whether counter affidavit is filed or not as further opportunity stands declined.
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2018 (11) TMI 1944
TDS u/s 194C - assessee, an AOP and engaged in ‘contract works’- payment towards sub-contracts which were given on back-to-back basis to the JV partners - assessee submitted that the Joint Venture (JV) and its constituent members do not have a contractor and sub-contractor relationship between them and hence, there is no liability on the JV to deduct tax at source - HELD THAT:- Having regard to the rival contentions and the material on record, we find that the similar issue had arisen in the assessee’s own case in the earlier assessment years and this Tribunal has held that there is no contractor and sub-contractor relationship between the assessee and its constituent members of JV and therefore, we see no reason to interfere with the order of the CIT(A), which is an order passed by following the decision of the ITAT. Decided against revenue.
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2018 (11) TMI 1943
Penalty levied u/s 271(1)(c) - TP adjustment made to the international transaction - HELD THAT:- As the quantum addition has been deleted by the Tribunal. Thus, the penalty levied has no legs to stand. Considering the above stated position, we dismiss the grounds raised by the Revenue.
Penalty u/s 271(1)(c) - mandation to record satisfaction - HELD THAT:- At the time of initiation of penalty proceedings in the assessment, AO did not mention any limb of section 271(1) of the Act whereas at the time of levy of penalty, the AO mentioned the limb stating that the assessee “concealed the particulars of its income”. This manner of recording of satisfaction suggests the existence of ambiguity with reference to applicability of specific limb.
Therefore, such penalty order is unsustainable in law legally. It is a settled legal proposition that the AO is under obligation to specify the correct limb at the time of initiation as well as at the time of levy of penalty. In view of the above deliberation on this issue, without going into the merits of the penalty, we are of the opinion that the penalty order is liable to be quashed on this legal issue. Thus, the grounds raised by the Revenue are dismissed.
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2018 (11) TMI 1942
Resolution professional seeking withdrawal of application under Section 12A of the I&B Code - Whether RP can move such withdrawal application? - HELD THAT:- The ‘resolution professional’ cannot file an application for withdrawal of an application under Section 7 or 9 or 10 of the I&B Code. As per Section 12A, it is the applicant who can only file such an application for withdrawal on which the Adjudicating Authority may pass an appropriate order - Therefore, the application for withdrawal can be filed only by the applicant, who initially filed application under Section 7 or 9.
Regulation 30A cannot over-ride the substantive provisions of Section 12A according to which the ‘applicant’ can only move application for withdrawal of the application before the Adjudicating Authority and not by the ‘resolution professional’.
Therefore, if the application for withdrawal is filed by the applicant in the present case, in such case the Adjudicating Authority will decide the case in accordance with the provisions of Section 12A - Post the matter ‘for orders’ on 11th December, 2018 to report the development.
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2018 (11) TMI 1941
Recovery of remission of duty - semi finished goods lost in fire - Rule 21 of the Central Excise Rules, 2002 - HELD THAT:- The said issue has already been settled by this Tribunal in appellant’s own case while entertaining the claim of remission of duty by this Tribunal in PARK NONWOVENS PVT. LTD. VERSUS CCE, DELHI-III [2017 (3) TMI 1923 - CESTAT DELHI] wherein it has been held that the appellant is not required to reverse the cenvat credit contained in work in progress finished goods and semi finished goods. Taking note that the said order which has been accepted by the Revenue, the ld. Commissioner (A) was not required to pass the impugned order for recovery of cenvat credit on inputs contained in work in progress of semi finished goods which shows that the ld. Commissioner (A) have no regard to the order passed by this Tribunal, it is found that recently the Hon’ble High Court of Karnataka in the case of XL HEALTH CORPORATION INDIA PVT. LTD. VERSUS THE UNION OF INDIA, DEPUTY COMMISSIONER SERVICE TAX, DIVISION-III SERVICE TAX-I, COMMISSIONERATE [2018 (10) TMI 1565 - KARNATAKA HIGH COURT] observed that the ld. Commissioner (A) has not given any regard to the Tribunal’s orders imposed a fine of Rs. 1 Lac on the Ld. Commissioner (A). In that circumstances, the Commissioner (A) has not respected the order of this Tribunal required to be penalized.
Therefore, the ld. Commissioner (A) is directed to take care in future to avoid any penal action from this Tribunal.
The impugned order is set aside. The appeal is allowed.
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2018 (11) TMI 1940
Bogus purchases - Consequent bogus sales - as per ITAT as confirming CIT(A) order addition is without any basis - Also as purchases made are not bogus purchases, the sales made out of such purchases cannot be treated as bogus sales - Disallowance of interest paid to Hawala operators be deleted as when the loan was received had not disallowed same as not genuine, having not disallowed the principal as not genuine, there is no justification for making any disallowance of interest paid to the above parties.
HELD THAT:- Since the concurrent findings of fact given by the Commissioner of Income Tax (Appeals) as well as the Income Tax Appellate Tribunal cannot be re-opened and re-looked into as those are concluded findings and nothing in terms of error in relation to the view so taken by the two forums emerge, we are of the opinion that no significant question of law as such is made out to interfere with the impugned decision or decisions.
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2018 (11) TMI 1939
Bogus LTCG on purchase and sale of the shares - addition of the entire sale proceeds of the shares as income and rejected the claim of exemption made u/s 10(38) - CIT relied upon “circumstantial evidence” and “human probabilities” to uphold the findings of the AO - HELD THAT:- No direct material was found to controvert the evidence filed by the assessee, in support of the genuineness of the transactions.
The overwhelming evidence filed by the assessee remains unchallenged and uncontroverted. The entire conclusions drawn by the revenue authorities, are based on a common report of the Director of Investigation, Kolkata, which was general in nature and not specific to any assessee. The assessee was not confronted with any statement or material alleged to be the basis of the report of the Investigation Wing of the department and which were the basis on which conclusion were drawn against the assessee. Copy of the report was also not given.
Under the circumstances, in a number of cases this bench of the Tribunal has consistently held that decision in all such cases should be based on evidence and not on generalisation, human probabilities, suspicion, conjectures and surmises. The addition made u/s 68 of the Act, is deleted. Decided in favour of assessee.
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