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Showing 21 to 40 of 2148 Records
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2018 (8) TMI 2134 - ITAT BANGALORE
Exemption u/s 11 disallowed - intimation u/s. 143(1) - AO disallowed the claim of assessee for exemption u/s. 11(2) for the reason of non-filing of Form 10 u/s 11(2) as 85% of the income of a charitable trust has to be applied for charitable purposes - assessee filed an application u/s. 154 seeking to rectify the intimation u/s. 143(1) contended that in the original return filed for the A.Y 2014-15, the fact of accumulation of income u/s 11(2) was mentioned. The appellant had already prepared an application for accumulation in Form 10 - assessee submitted that since intimation u/s. 143(1) is not an assessment, the request of the assessee to accept Form 10 and allow accumulation ought to have been accepted and intimation u/s. 143(1) rectified - HELD THAT:- As relying on Bagalkot Town Development Authority [2014 (7) TMI 91 - ITAT BANGALORE] following NAGPUR HOTEL OWNERS ASSOCIATION case [2000 (12) TMI 99 - SUPREME COURT] that intimation required u/s 11 has to be furnished before the assessing authority completes the concerned assessment.
In the present case, there was no assessment proceeding and there is only intimation u/s. 143(1) of the Act. An intimation u/s. 143(1) is not an assessment as laid down in the case of Rajesh Jhaveri Stock Brokers [2007 (5) TMI 197 - SUPREME COURT] - In view of the legal position as explained above, we are of the view that the AO ought to have accepted the application for rectification u/s. 154 of the Act. We accordingly direct the AO to allow application u/s. 154 of the Act and rectify the intimation. Appeal by the assessee is allowed.
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2018 (8) TMI 2133 - ITAT KOLKATA
Disallowance u/s 14A r.w.r. 8D - expenses incurred in relation to earning of exempt income - Assessee contended that investments were made by the assessee company out of its own funds which was sufficient to cover the cost of investments and that no interest bearing funds were utilized to make investments which yielded the exempt income - HELD THAT:- Admittedly, investments in bonds and debentures and advance to subsidiaries could not have produced tax free income and for that reason sec. 14A was not applicable to it. Even the lower authorities have not made out any case that the borrowed funds were relatable to investment in bonds and debentures and advance to subsidiary and that the interest paid thereon was for non-business purposes and hence, disallowable u/s. 36(1)(iii) of the Act.
We, therefore, do not deem it fit or appropriate to entertain this argument at this stage as it would tantamount to enhancing the scope of appeal whereas the issue before us concerns only disallowance u/s. 14A - respectfully following the order of the Tribunal [2018 (5) TMI 255 - ITAT KOLKATA] for AY 2008-09, we direct the AO to delete the disallowance of proportionate interest made u/s. 14A of the Act read with Rule 8D(2)(ii) of the Rules.
Addition made u/r 8D(2)(iii) - Tribunal in assessee’s own case for AY 2008-09 [2018 (5) TMI 255 - ITAT KOLKATA] following the decision of REI Agro Ltd. [2013 (9) TMI 156 - ITAT KOLKATA] held that only dividend bearing investment in shares are to be considered for making disallowance u/s. 14A of the Act. Following the same, we remand this issue back to the file of the AO with a direction to consider only investment in shares and units held on the opening and closing date of the previous year which yielded dividend income for the purpose of computing the disallowance u/s. 14A of the Act read with Rule 8D(2)(iii)
Computation of deduction u/s. 10B and 80IA - allocation of 7.39% of directors’ remuneration and auditor’s remuneration to be considered as deduction in arriving at the profits of the undertakings eligible for deduction u/s. 10B and 80IA - HELD THAT:- On perusal of the separate audited accounts of the eligible undertakings, we note that no expenses have been debited in respect of the audit conducted on these segmental accounts and in that view of the matter, we hold that the auditor’s remuneration debited in P&L Account, inter-alia, comprised of the fees paid to auditors for auditing the separate accounts of the eligible undertakings. In absence of the break-up of fees paid to auditors, we find no infirmity in the order of the lower authorities in allocating the auditor’s remuneration to the eligible undertaking on pro-rata basis and hence, the order of the lower authorities to that extent is confirmed.
Director’s remuneration - We find that the same can be bifurcated into remuneration and sitting fees paid to non-executive Directors and to the Managing Director. We note that the non-executive Directors do not participate in the day-to-day work of the company nor are in-charge of the operations of the undertakings and hence the remuneration paid to them did not have first degree nexus with the profits of the eligible undertaking.
Non-executive directors attended the board meetings and were involved in policy decision making, matters of corporate governance etc. which had no first degree nexus with the operations of the eligible undertaking DR could not controvert this particular fact, therefore, the AO/Ld. CIT(A) erred on facts and in law in allocating sums out of the Director’s remuneration while arriving at the income eligible for deduction u/s. 80IA/10B of the Act and, therefore, we delete the allocation made on this issue.
Remuneration paid to the Managing Director - We note that the Managing Director is involved in the day-to-day affairs of the company and is responsible for over-all operations of the company including the eligible undertaking. Managing Directors’ remuneration indeed have nexus with the functioning of the eligible undertaking and, therefore, we uphold the allocation made out of the Managing Directors’ remuneration to the profits of the eligible undertaking. Therefore, ground nos. 4 and 5 are partly allowed.
Deduction of prior period expenses - According to AO, the assessee was unable to establish that this liability for expenses pertaining to earlier years had crystalised during the financial year and, therefore, disallowed the entire sum - CIT(A) deleted addition - HELD THAT:- Since interest demand was raised by the payee only in the relevant year, the Ld. CIT(A) rightly held that the liability for such expenses arose and crystalised in this year only.
As regards other items of expenses, CIT(A) observed that the bills for certain expenses for the FY 2007-08 were received by the assessee only in the next year i.e. the relevant FY 2008-09. Although the assessee had provided for the expenses on estimate basis in the earlier year but there was certain difference between the provisions estimated and the actual billed amount and it was this differential amount which was charged to the P&L Account for the relevant year.
CIT(A) correctly observed that since the bills were received after the end of the FY 2007-08 and in FY 2008-09, the differential amount had crystalised in the relevant year itself and, therefore, allowed the same. - Decided against revenue.
CIT(A) in restricting the allocation of expenses on legal and professional and travelling and conveyance to the eligible undertaking u/s. 80IA and 10B - HELD THAT:- From perusal of the schedule of expenses forming part of the audited accounts, we find that legal and profession expenses as well as travelling and conveyance expenses incurred by these undertakings were debited to the stand alone account of these eligible undertakings and hence, no further allocation on account of these items of expenses to the eligible undertakings was warranted. DR was unable to controvert this fact which is evident from the documents on record.
Allocation of ‘common expenses’ comprising of Director’s remuneration, Auditor’s remuneration, conveyance and travelling expenses and legal and professional expenses in working out the profits of the eligible undertakings u/s. 80IA and 10B -HELD THAT:- Managing Director’s remuneration and auditor’s remuneration had nexus with the functioning of the eligible undertakings and accordingly, confirm the orders of the lower authorities for making allocation out of these expenses against the income to be considered for the purpose of computing deduction u/s. 80IA and 10B of the Act. Similarly, we find that the auditor had identified and allocated the expenditure relatable to the eligible undertakings on account of travelling and conveyance and legal and professional expenses and in that view of the matter we uphold the order of the Ld. CIT(A) that no further allocation on account of these two items of expenses was called for.
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2018 (8) TMI 2132 - ITAT RAIPUR
Nature of receipt - subsidy received - revenue or capital receipt - AO noted that the subsidy was received after commencement of production and, therefore, it is the nature of revenue subsidy because it was given to the assessee after commencement of production to enable it to run the business more profitably and it is an operation subsidy - HELD THAT:- We find identical issue had come up before the Tribunal in assessee’s own case [2015 (11) TMI 1865 - ITAT RAIPUR] as upheld the order of the ld. CIT(A) deleting the addition.
While doing so, the Tribunal has followed the decision of Reliance Industries Ltd. [2003 (10) TMI 255 - ITAT BOMBAY-J], therefore, in absence of any contrary material brought to our notice, we do not find any infirmity in the order of the ld. CIT(A) deleting the addition made by the Assessing Officer. The ground raised by the Revenue is accordingly dismissed.
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2018 (8) TMI 2131 - SC ORDER
Enforcement of a foreign award - Sections 47 to 49 of the Arbitration and Conciliation Act, 1996 - HELD THAT:- The special leave petition is dismissed.
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2018 (8) TMI 2130 - ITAT MUMBAI
TP Adjustment - Segregation of services - Assessee furnished separate set of comparables for “Trading Segment” and “Services Segment” - TPO determined ALP of the transactions by segregating the services rendered by the assessee company into two different segments, viz., “Trading segment” for supply of materials and “Services segment” for services actually rendered - DRP also upheld the same - According to the assessee, both are composite services and hence the TPO was not right in determining ALP separately for Products and Services - HELD THAT:- As rightly pointed out by Ld D.R, we are of the view that this specific contention of the assessee requires examination at the end of AO/TPO, since these aspects have not been taken into consideration by them while determining the ALP of the assessee.
The co-ordinate bench of Tribunal, in the cases relied upon by the assessee Boskalis International Dredging International [2014 (7) TMI 866 - ITAT MUMBAI] AND Gates India (P) Ltd [2017 (8) TMI 282 - ITAT DELHI] has expressed the view that the closely linked transactions/composite transactions have to be examined together. Since this contention of the assessee goes to the root of the issue, we are of the view the same needs to be examined at the end of AO/TPO. Accordingly we set aside the matter relating to determination of ALP of the transactions entered by the assessee with its AE to the tile of AO/TPO for examining them afresh by duly considering the various contentions of the assessee.
Direct expenses computation for the purpose of computing gross profit margin - Decision of TPO in including liquidated damages as part of direct expenses - D.R submitted that the liquidated damages have been incurred by the assessee in connection with rendering of services and accordingly submitted that the TPO has rightly included it as part of direct cost - HELD THAT:- As relying on Emerson Process Management (India) (P) Ltd. [2012 (9) TMI 42 - ITAT MUMBAI] liquidated damages cannot be considered as direct cost for the purpose of computing Gross profit margin.
Delayed employees’ contribution to PF and ESI - amount not been remitted within the due date prescribed in the respective Acts - A.R submitted that he has paid the same within the due date prescribed for filing return of income u/s 139(1) and hence the same is allowable as deduction as per the decision of CIT vs. Ghatge Patil Transports Ltd [2014 (10) TMI 402 - BOMBAY HIGH COURT] - HELD THAT:- We set aside the order passed by the AO on this issue and direct the AO to allow the deduction after satisfying himself that the impugned employees contribution have been remitted before the due date prescribed u/s 139(1) of the Act for filing return of income for the year under consideration.
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2018 (8) TMI 2129 - ITAT MUMBAI
Taxability of profits of life insurance business - additions relating to net surplus as per actuarial valuation was made by the AO - HELD THAT:- As decided in assessee own case [2017 (3) TMI 1696 - ITAT MUMBAI] relying on case of ICICI Prudential Insurance Co. Ltd [2012 (11) TMI 13 - ITAT MUMBAI] has held that “where assessee was carrying on life insurance business and Tribunal following a decision of Supreme Court, while determining assessee’s income under section 44, had taken into consideration total surplus as arrived at by actuarial valuation and further held that income from shareholders account was also to be taxed as a part of life insurance business, there was no substantial question of law arising for consideration”.
Reference was made to the decision in LIC of India vs. CIT [1963 (12) TMI 5 - SUPREME COURT] wherein the Hon'ble Supreme Court has held that the Assessing Officer has no power to modify the account after actuarial valuation is done. Decided against revenue.
Disallowance of loss from pension fund - assessee in the computation of income has claimed exemption u/s 10(23AAB) on account of surplus / deficit pension fund - AO disallowed exemption as case of Life Insurance Corporation of India Ltd [1963 (12) TMI 5 - SUPREME COURT] relied upon by assessee as justifying its claim was challenged by the Department before the Hon'ble Supreme Court by filing Special Leave Petition - HELD THAT:- Merely because the Revenue has filed SLP against the decision of the Hon'ble Jurisdictional High Court in case of Life Insurance Corporation Ltd. cannot be valid reason for the Assessing Officer in not following the decision of the Hon'ble Jurisdictional High Court which is binding on him. Be that as it may, we have noticed that while deciding identical issue raised by the Revenue in assessee’s own case for assessment year 2011–12, [2017 (3) TMI 1696 - ITAT MUMBAI] held that (i) amount set apart by insurance company towards solvency margin as per the direction given by IRDA is to be excluded while computing actuarial valuation surplus, and (ii) pension fund like Jeevan Suraksha Fund would continue to be governed by provisions of section 44 irrespective of the fact that income from such fund is exempted, or not and, therefore, even after insertion of section 10(23AAB), loss incurred from pension fund like Jeevan Suraksha Fund has to be excluded while determining actuarial valuation surplus from insurance business u/s 44.
Revenue appeal dismissed.
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2018 (8) TMI 2128 - CESTAT CHANDIGARH
Denial of education cess and higher education cess - duty paid by availing the benefit of education cess and higher education cess also dis-allowed - HELD THAT:- Considering the fact that the issue has been settled by the Hon’ble Apex Court in the case of M/S. SRD NUTRIENTS PRIVATE LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE GUWAHATI [2017 (11) TMI 655 - SUPREME COURT], wherein it has been held that education cess/ higher education cess is consequent to duty payable by the assessee-appellants. In that circumstances, the assessee-Appeal appellants are entitled to claim refund of education cess and higher education cess. Consequently, the said dis-allowance of rejection of refund claim as well as dis-allowance of the self credit of the same cannot be denied to the appellants.
The impugned order qua the issue of education cess/higher education cess set aside - appeal disposed off.
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2018 (8) TMI 2127 - ITAT KOLKATA
Addition u/s 68 - assessee is a proprietor of a rice mill and has taken unsecured loan of Rs. 50 lacs from two legal entities - CIT(A) deleted the addition - HELD THAT:- We note that the assessee has discharged the onus casted upon him to prove the identity, creditworthiness and genuineness of the lenders. We note that assessee has returned the loan through account payee cheque before 24.05.2013 to both lenders which facts could not be controverted by the revenue. In such a scenario, the factual finding of Ld. CIT(A) cannot be disturbed and so we confirm the same. Appeal of revenue is, therefore, dismissed.
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2018 (8) TMI 2126 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI
Seeking vacation/recall of admitting CIRP application - Appellant was wrongly kept out of the Committee of Creditors or not - HELD THAT:- It is settled that no application for recall of any order of admission of application under Section 7 can be entertained by the Adjudicating Authority, it having no such jurisdiction. Even the party who has filed application cannot withdraw such application after the admission in view of regulation 8 of ‘The Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016’.
The Appellant, who is a ‘Financial Creditor’, also cannot claim to be an aggrieved person, if an application under Section 7 is admitted pursuant to application filed by other Financial Creditor. Appellant being a related party to the Corporate Debtor was not made the member of the Committee of Creditors, which order was also not challenged.
The I. A. having filed by the Appellant with a motive to delay the process and being frivolous it was fit case for Adjudicating Authority to impose cost upon him while passing the order - appeal dismissed with costs.
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2018 (8) TMI 2125 - ITAT RAIPUR
Levy of penalty u/s 271(1)(c) - defective notice u/s 274 - non specification of clear charge - assessees are employees of SAIL[Bhilai Steel Plant] and derive income from salary as claimed the perquisites received from the employer as exempt - AO reopened all these cases by issue of notice u/s 148 and respective employees offered the entire income and paid the taxes thereon and repaid refunds issued earlier on the basis of the original returns of income - HELD THAT:- A perusal of the notice issued u/s 274 r.w.s. 271 in each case shows that the inappropriate words in the said notice has not been struck off i.e. the notice does not specify under which limb of section 271(1)(c) the penalty proceedings had been initiated i.e. whether for concealment of income or for furnishing of inaccurate particulars of income.
Since in the instant case, AO has not struck off the inappropriate words in the notices issued u/s 274 r.w.s. 271, therefore, the notice does not specify under which limb of section 271(1)(c) the penalty proceedings had been initiated i.e. whether for concealment of income or for furnishing of inaccurate particulars of income. Therefore, the penalty proceedings become bad in law. Decided in favour of assessee.
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2018 (8) TMI 2124 - SC ORDER
Time limitation for passing arbitral award - whether Section 34 application could be said to be within the time mentioned in Section 34(3) of the Arbitration and Conciliation Act, 1996 - HELD THAT:- The judgment of the Bombay High Court in the case of Amit Suryakant Lunavat vs. Kotak Securities, Mumbai [2010 (9) TMI 1292 - BOMBAY HIGH COURT] does not reflect the correct position in law. Section 34(3) specifically speaks of the date on which a request under Section 33 has been “disposed of” by the Arbitral Tribunal.
Thus, a “disposal” of the application can be either by allowing it or dismissing it. On this short ground the learned Single Judge of the Delhi High Court is correct in law - SLP dismissed.
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2018 (8) TMI 2123 - SUPREME COURT
Appointment of Chartered Accountant - Jurisdiction of a civil revision when Under Section 47 of the Code of Civil Procedure for such appointment - HELD THAT:- The High Court has acted in manifest excess of its jurisdiction while directing the appointment of a Chartered Accountant for the purpose of determining as to whether the decretal debt is to be marked as satisfied. The execution proceeding is pending before the Additional Civil Judge, Dehradun and, as we have noticed, various orders have been passed thereon from time to time. The issue as to whether the decree has been discharged or satisfied has to be determined by the Executing Court Under Section 47 of the Code of Civil Procedure. The Executing Court must execute the decree as it stands without adding anything to it - The High Court has acted in excess of jurisdiction by directing the appointment of a Chartered Accountant, particularly at this stage.
The impugned order of the High Court dated 18 September 2017 set aside - appeal allowed.
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2018 (8) TMI 2122 - SC ORDER
Valuation - determination of assessable value of export goods - Iron Ore Fines - duty to be calculated on ‘Wet Weight’ basis or not - HELD THAT:- Admit the appeal.
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2018 (8) TMI 2121 - BOMBAY HIGH COURT
Validity of remand order - Appellate Tribunal made prima facie findings / observations while remanding the matter without expressly stating that all questions of law and fact are left open on remand.
Appellant seeks that the adjudicating authority will decide the issue in accordance with law without being influenced by the prima facie observations.
HELD THAT:- The impugned order of Tribunal has admittedly used the word “prima facie it seems”. Thus it is not a final view of the Tribunal. It further goes on to state that to ascertain status of the Appellant the facts would have to be ascertained in context of the bills and invoices raised by services provider, treatment of payment transaction etc. and only thereafter the application of judgments to the facts existing in this case could arise - This would indicate that the prima facie view of the Tribunal is a tentative view subject to examination of the facts. Therefore, the prima facie observations would not per se influence the adjudicating authority.
The question as proposed does not give rise to any substantial question of law. Thus not entertained - Appeal disposed off.
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2018 (8) TMI 2120 - SUPREME COURT
Validity of the charge memo - continuance of Respondent No. 1 under suspension - tampering with the witness - Rule 14 of the Central Civil Services (Classification, Control and Appeal) Rules, 1965 and Rule 8 of the All India Service (Discipline and Appeal) Rules, 1969.
Validity of the Charge-Memo - HELD THAT:- Rule 8 of the All India Service (Discipline and Appeal) Rules, 1969 prescribes a procedure for imposing major penalties. A major penalty specified in Rule 6 cannot be imposed except after holding an enquiry in the manner prescribed in Rule 8. Where it is proposed to hold an enquiry against a member of the service Under Rule 8, the disciplinary authority shall "draw up or caused to be drawn up" the substance of the imputation of misconduct or misbehavior into definite and distinct Article of charge. The Rule further provides for an opportunity to be given to the delinquent to submit his explanation, the appointment of an inquiring authority and the procedure to be followed for imposition of a penalty with which we are not concerned in this case - There is no doubt that the Government of Tamil Nadu is the disciplinary authority. The authority to act on behalf of the State Government as per the Business Rules is the Minister for Home Department.
It is clear that the approval of the disciplinary authority was taken for initiation of the disciplinary proceedings. It is also clear from the affidavit that no approval was sought from the disciplinary authority at the time when the charge memo was issued to the delinquent officer. The submission made on behalf of the Appellant is that approval of the disciplinary authority for initiation of disciplinary proceedings was sufficient and there was no need for another approval for issuance of charge memo. The basis for such submission is that initiation of disciplinary proceedings and issuance of charge memo are at the same stage - It is also settled law that if the Rule requires something to be done in a particular manner it should be done either in the same manner or not at all.
Deemed suspension Under Rule 3(2) of the All India Services Rules for being in custody for a period of more than 48 hours - HELD THAT:- Periodic reviews were conducted for his continuance under suspension. The recommendations of the Review Committees did not favour his reinstatement due to which he is still under suspension. Mr. P. Chidambaram, learned Senior Counsel appearing for the first Respondent fairly submitted that we can proceed on the basis that the criminal trial is pending. There cannot be any dispute regarding the power or jurisdiction of the State Government for continuing the first Respondent under suspension pending criminal trial. There is no doubt that the allegations made against the first Respondent are serious in nature. However, the point is whether the continued suspension of the first Respondent for a prolonged period is justified.
The first Respondent has been under suspension for more than six years. While releasing the first Respondent on bail, liberty was given to the investigating agency to approach the Court in case he indulged in tampering with the evidence. Admittedly, no complaint is made by the CBI in that regard. Even now the Appellant has no case that there is any specific instance of any attempt by the first Respondent to tamper with evidence.
Thus, no useful purpose would be served by continuing the first Respondent under suspension any longer and that his reinstatement would not be a threat to a fair trial - appeal disposed off.
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2018 (8) TMI 2119 - SC ORDER
Entitlement for for tax-cum value - calculation of service tax liability - HELD THAT:- Issue notice in the prayer for interim relief as well as in the appeal, returnable in four weeks.
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2018 (8) TMI 2118 - ITAT BANGALORE
Disallowance u/s 14A r.w.r. 8D - Whether no exempt income has accrued to the assessee from the investment made in the sister concerns? - HELD THAT:- In the present case, there is no change in facts as facts are similar to the facts of the earlier decision rendered by the Tribunal in the case of the assessee for AY 2009-10 [2015 (8) TMI 605 - ITAT BANGALORE] where the Tribunal has deleted the disallowance on the premise that no exempt income has accrued to the assessee from the investment made in the sister concerns. Therefore, following the decision of the coordinate bench in the case of the assessee, for earlier year and also following the judgment of matter of Chem Chem Investment [2011 (11) TMI 267 - DELHI HIGH COURT] - Section 14A will not apply if no exempt income is received or receivable during the relevant previous year - we dismiss the appeals of the Revenue.
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2018 (8) TMI 2117 - ITAT BANGALORE
Unexplained bank deposits - deposits through undisclosed sources - sufficient time lag between the dates of withdrawal of cash from the bank account and the dates of deposits - apply the peak credit theory or not? - what if the deposit of money in the bank account is preceded by withdrawal of money from the very same bank account? - HELD THAT:- It is seen that the cash deposits in the bank account are preceded by withdrawal from the very same bank account. The cash flow statement filed by the Assessee explaining availability of cash on the various dates of deposit of cash in the bank account has not been disbelieved by the Revenue authorities.
As in the case of S.R. Ventakaratnam Vs CIT, Karnataka-I & Others [1980 (8) TMI 73 - KARNATAKA HIGH COURT] has held that once the Assessee discloses the source as having come from the withdrawals made on a given date from a given bank, it was not open to the revenue to examine as to what the Assessee did with that money and cannot chose to disbelieve the plea of the Assessee merely on the surmise that it would not be probable for the Assessee to keep the money unutilized.
If the revenue wants to disbelieve the plea of the Assessee then it must show that the previous withdrawal of cash would not have been available with the Assessee on the date of deposit of cash in the bank account. The AO and CIT(A) have proceeded purely on assumption and surmises that cash would not be lying idle with the Assessee for such a long time - Decided in favour of assessee.
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2018 (8) TMI 2116 - ITAT DELHI
Addition u/s 36(1)(iii) - Non-charging of interest on loans from the related parties - as per AO Assessee has diverted its interest bearing funds as loans and advances to sister concerns and others without charging of any interest - HELD THAT:- It is an admitted fact that nothing has been brought on record that any specific interest bearing borrowed funds has been diverted by the assessee to the related parties from whom no interest has been charged. Since the net owned funds of the assessee company in the instant case is much more than the interest free advances given to related parties and since the Revenue has not brought on record any specific instance of interest bearing borrowed funds being diverted to the related parties free of interest, thus no disallowance u/s 36(1)(iii) is called for.
As in the case of CIT vs. Reliance Utilities and Power Ltd. [2009 (1) TMI 4 - BOMBAY HIGH COURT] has held that if there are funds available both interest free and overdraft and/or loans taken, then a presumption would arise that investments would be out of the interest free funds generated or available with the assessee company, if the interest free funds were sufficient to meet the investment. Appeal filed by the assessee is allowed.
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2018 (8) TMI 2115 - GUJARAT HIGH COURT
Freezing of Bank account of petitioner - Seeking withdrawal of amount held in Bank Account - imposition of condition of furnishing bank guarantee of any nationalized bank of an amount equal to the amount lying on such account on the date of withdrawal - HELD THAT:- Before the Supreme Court, the petitioner sought permission to sell further shares - the Supreme Court permitted the petitioner to sell its remaining shares and securities through recognized stock exchanges and registered stock brokers and credit the sale proceeds in the bank account maintained by the petitioner with ICICI Bank. It is a matter of record that the sale proceeds of the remaining shares brought a sum of Rs.42.51 crores which was deposited in the petitioner's said bank account.
One may recall, the initial order restraining the petitioner from dealing in Indian Stock Market was passed by SEBI. However, when these proceedings were on going, the CBI restraint order dated 26.10.2006 also came to be passed. The Appellate Tribunal had permitted the petitioner-Company to sell some of the shares and to deposit sale proceeds in the bank account. Along with existing balance added by the sale proceeds, the total came to approximately Rs.38 crores. The Supreme Court further permitted the petitioner to sell shares proceeds of which came to Rs.42.51 crores - All along, the Supreme Court had made a clear distinction between the two amounts. Insofar as, sum of Rs.42.51 crores is concerned, the Supreme Court had concluded that the same was not covered under CBI's restraint order. The petitioner was allowed to withdraw the same unconditionally. However, with respect to rest of the amount, the Supreme Court granted no relief except allowing the petitioner to challenge such restraint order passed by CBI. Thus, the first contention of the counsel for the petitioner that there was no distinction between the two amounts is not well founded. Had the case been so simple, surely the Supreme Court itself would have released both the amounts.
Quite apart from the various aspects emerging from the affidavit, it is neither possible nor correct on my part to interfere at this interim stage in the present proceedings and hold that all the above assertions made by CBI are incorrect and there is no trail of tainted money having been routed through foreign destinations back into the said account in ICICI Bank.
Discharge of Dharmesh Doshi, accused No.8 - HELD THAT:- Learned Magistrate noted that he has already been discharged. It is primarily on this basis that he permitted the petitioner to withdrawal of the amount. He, however, imposed condition for providing bank guarantee of a matching sum. If the discharge of accused No.8 had attained finality perhaps the petitioner was justified in contending that petitioner should have been allowed withdrawal of the amount unconditionally. However, discharge of Dharmesh Doshi accused No.8 is not yet final. Revision Petition filed by CBI against the order of the Magistrate is pending before the Sessions Court. To safeguard the interest of the respondents, it would be absolutely necessary to maintain the condition imposed by the learned Magistrate.
Petition dismissed.
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