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Showing 81 to 100 of 1450 Records
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2021 (7) TMI 1372 - SC ORDER
Belated return of income accepted by condoning the delay - Condonation of delay in filing return - reasonable cause of delay - genuine hardship - HELD THAT:- Having considered the facts and circumstances due to which the respondent-assessee, at the relevant time, could not file the return of income within the time prescribed, the order passed by the High Court directing the Revenue to condone the delay and accept the belated return of income and to consider the return of income in accordance with law on merits does not warrant any interference. The facts which led to the assessee in late filing of the return of income are glaring.
Therefore, no interference of this Court is called for, in exercise of powers under Article 136 of the Constitution of India. However, at the same time, the question of law, “whether the CBDT, while exercising the powers under Section 119(2)(b) of the Income Tax Act, can direct to condone the delay in filing the return of income” is kept open to be considered in an appropriate case. It is further observed that the impugned judgment and order passed by the High Court be not treated as a precedent. SLP dismissed.
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2021 (7) TMI 1371 - MADRAS HIGH COURT
Illegal detention of imported consignments - prime contention of the petitioner is that, certain containers imported are illegally detained by the respondents, and in spite of their request, the respondents have not taken any steps to release the containers as specified - HELD THAT:- This Court is of the considered opinion that imports and exports are to be done by following the procedures contemplated and by complying with the mandatory requirements. The relief as such sought for in the present writ petition to direct the respondents to forthwith release and return the containers, itself is absurd. Such a relief requires adjudication in view of the fact that there are statutory requirements and compliance of the terms and conditions with the Customs Cargo Service Provider and other aspects of the matter. Without adjudicating all those factors, the High Court cannot issue a writ granting the relief in the writ petition filed.
When disputed facts are raised between the parties, the same cannot be entertained and the High Court cannot conduct a roving enquiry with reference to the dispute, which is to be resolved with reference to the documents and evidence produced before the competent authorities - Petition disposed off.
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2021 (7) TMI 1370 - APPELLATE AUTHORITY FOR ADVANCE RULING, MADHYA PRADESH
Maintainability of appeal - Admissibility of input tax credit - inward supply of local scrap and sponge iron used by the appellant for manufacture of M.S. billets - procedure adopted and the documents/records maintained by the appellant can be deemed to be a sufficient compliance of the conditions and restrictions or not - Section 16 of GST Act and Rule 36 of GST Rules - HELD THAT:- It is found that the first proviso to section 98(2) of CGST Act, 2017 is very clear, that the authority shall not admit the application where the question raised in the application is already pending or decided in any proceedings in case of an applicant under any of provisions of this Act.
Section 100(1) mandates that only a ruling pronounced under sub-section (4) of section 98 of CGST, Act, 2017 can be appealed before the Appellate Authority for Advance Ruling.
The instant application is not maintainable because it is covered in the first proviso to section 98(2) of the Act - Appeal dismissed.
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2021 (7) TMI 1369 - APPELLATE AUTHORITY FOR ADVANCE RULING, MADHYA PRADESH
Classification of supply - composite supply or individual supply - contracts towards construction, O&M and other ancillary contracts which are in relation to work entrusted to MPPGCL by the State Government - rate of GST applicable on Construction contracts awarded by MPPGCL which are in relation to work entrusted to MPPGCL by the State Government - rate of GST on O&M and other ancillary contracts awarded by MPPGCL which are in relation to work entrusted to MPPGCL by the State Government - Notification No.11/2017-CT(R) as amended.
HELD THAT:- In order to qualify for the concessional rate of tax @6% CGST + 6% SGST, under Entry No.(vi)(a) of Sr. No.3 of Notification No.11/2017-Cental tax (Rate) as amended, the main conditions to be fulfilled are that the contract involves composite supply as defined in Section 2(30) of CGST Act, 2017, the contract involves works contract as defined under section 2(119) of CGST Act, 2017 and such services are supplied to a Government Entity. In absence of complete contracts/work orders, it is not feasible to decide the nature of supply and GST rates for large number of contracts.
The ruling passed by the Authority of Advance Ruling need not be interfered in the present case - application dismissed.
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2021 (7) TMI 1368 - APPELLATE AUTHORITY FOR ADVANCE RULING, MADHYA PRADESH
Levy of GST on sub contractor - sub contractor executes works contract pertaining to dam, wherein the principal contractor is liable for tax @ 12%, for the period from 22-01-2017 to 25-01-2018 - HELD THAT:- Sub-section (2) of Section 70 is very clear that every such inquiry shall be deemed to be a “judicial proceedings” within the meaning of section 193 and section 228 of the Indian Penal Code. Therefore, the appellant's contention that mere issue of such letter to them by DGGSTI authorities cannot be said to be any proceedings within the meaning of proviso to Section 98(2) of CGST Act, 2017, cannot be agreed upon.
For sub-contractors, subsequently the rate of tax for such services got reduced to 12% vide Notification No.1/2018- Central Tax (Rate) dated 25.01.2018. It was also informed that the said investigation in the matter is undergoing. As per the submission of appellant and available records, we find that Directorate General of Goods & Services Tax Intelligence (DGGSTI), Regional Unit, Indore, has already initiated proceeding against the appellant on the same question raised by the appellant before us and the said proceeding is still pending before the DGGSTI, Indore.
The first proviso to section 98(2) of CGST Act, 2017 is very clear, that the authority shall not admit the application where the question raised in the application is already pending or decided in any proceedings in case of an applicant under any of provisions of this Act - the Advance Ruling Authority has rightly rejected the appellant's application as per the first proviso to section 98(2) of CGST Act, 2017 on the grounds that the question raised by the appellant before the Authority is pending with the DGGSTI and proceeding against the appellant is underway by the DGGSTI, Regional Unit, Indore.
Section 100(1) mandates that only a ruling pronounced under sub-section (4) of section 98 of CGST, Act, 2017 can be appealed before the Appellate Authority for advance, Ruling. It is found that the Advance Ruling Authority in its Order 20/2020 has rejected the application of the appellant under section 98(2) of CGST, Act, 2017, and it cannot be said to be any advance ruling pronounced under sub-section (4) of section 98 of CGST, Act, 2017, therefore the appellants appeal fails on this count also.
The appeal filed by the appellant M/s Saisanket Enterprises stands dismissed on all accounts.
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2021 (7) TMI 1367 - AUTHORITY FOR ADVANCE RULING, ANDHRA PRADESH
Scope of Advance Ruling application - Classification of services - health services provided by M/s AHEL - classification under 9983 & 9985 is correct or not - applicability of IGST Exemption Notification for all or certain items of contractual services rendered by M/s AHEL as per the MoU - refund of IGST with retrospective effect - If refund claim cannot be made with M/s AHEL, what is the relief available to SDSC SHAR for the ineligible financial expenditure incurred towards IGST so far? - applicability of GST on on diesel bills paid on reimbursement basis for running ambulance/power generator by M/s AHEL at SDMH, Sullurpeta.
HELD THAT:- An applicant can seek an advance ruling in relation to supply of goods or services or both undertaken or proposed to be undertaken by the applicant. Further, as per Section 103 (1) of the APGST Act such an Advance Ruling is binding only on the applicant and on the Officer Concerned or the jurisdictional Officer in respect of the applicant.
In the present case the applicant is recipient of the services and not supplier of such services. Accordingly the application is not liable for admission and therefore rejected without going in to the merits of the case.
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2021 (7) TMI 1366 - KARNATAKA HIGH COURT
Nature of receipts - Securities held under 'held to maturity' have the material characteristics of capital asset rather than stock in trade and the form part of investments only - HELD THAT:- Question No.1 is covered against the Revenue in Commissioner of Income-tax, Hubli Vs. Karnataka Vikas Grameen Bank [2015 (12) TMI 1420 - KARNATAKA HIGH COURT]
Writing off entire expense as revenue - Whether expenditure towards software item is capital in nature having enduring benefit eligible for depreciation at 60%? - HELD THAT:- In [2013 (10) TMI 1225 - KARNATAKA HIGH COURT], this Court has recorded detailed reasons and held that software is an aid in manufacturing process rather than a tool itself. Though certain application has enduring benefit, it does not result into acquisition of capital asset. It merely enhances the productivity or the efficiency and therefore, it has to be treated as a Revenue expenditure. In Oriental Bank of Commerce [2018 (4) TMI 1534 - DELHI HIGH COURT] for the use of such software, the nature of expenditure otherwise incurred for streamlining its functions i.e. towards fee payable to the consultants for systems and employment of special professionals to carry on the tasks that the software in fact performs, would have fallen undoubtedly in the revenue stream. Taking these into account and the further circumstance that the software itself would have run its course or life span as it were, given that the earlier assessment year in question is 2008-09, we are of the opinion that the question of law framed is to be answered in favour of the assessee
Provision for expenses of branch offices' - AO disallowed the same on the ground that the liability is purely contingent and not an ascertained one - HELD THAT:- We have perused the said Circular. It is stated therein that in the Direct Tax Laws (Amendment) Act, 1987, the provisions of Section 36(1)(vii) of the IT act and Section 36(2) of IT Act, 1961, has been amended to rationalize the provisions regarding allowability of bad debt with effect from April 1, 1989. It is further stated that the Legislative intention behind the amendment was to eliminate the litigation on the issue of allowability of 'bad debt' by doing away with the requirement for assessee to establish that the debt had in fact, become irrecoverable. He placed reliance on Big Bags International Pvt. Ltd. [2020 (12) TMI 830 - KARNATAKA HIGH COURT] in support of this contention. In view of the said Circular and the said authority wherein, this Court has held that the Act mandates that in order to claim bad debts, the assessee has to write-off the same in his Books of accounts and he is not required to prove that the debt was irrecoverable, we answer this question in favour of the assessee and against the Revenue.
Writing off of non-banking assets - Whether losses which are contingent in nature cannot be allowed to be written off and charges against the profits of the company? - HELD THAT:- We hold that the ITAT's conclusion that the asset shall be treated as 'Stock in Trade' does not call for any interference and accordingly, this question is answered in favour of the assessee and against the Revenue
Broken period interest - Whether assessee cannot follow receipt basis of accounting for some items of income and follow accrual basis of accounting for other items of income? - HELD THAT:- This question is covered against the Revenue in Commissioner of Income-tax Vs. The Karnataka Bank Ltd [2014 (11) TMI 221 - KARNATAKA HIGH COURT] and the same is not disputed
Expenditure claimed to be incurred in connection with sale of shares - Whether assessee has failed to substantiate that the expenditure on sale of shares is a wholly and exclusively incurred for the purpose of transfer of shares? - HELD THAT:- ITAT has recorded that the terms of Compromise indicated that the payment of Rs.2.66 Crores was in connection with the transfer of Capital asset. We have also perused the portion of the compromise terms extracted in the ITAT's order. It is stated therein that parties had amicably agreed upon certain terms and the assessee had paid the said amount. The DHFL has waived all indemnities, liabilities and claims. It is settled that the Revenue shall not sit in the arm chair of an assessee and decide the exigencies of business/transactions. ITAT is the last fact finding authority and based on the facts, it has held that the expenditure had nexus with the agreement between the parties. In substance, assessee has paid money to DHFL to give quietus to the dispute between the parties. As per Section 48 of the Act, the expenditure incurred in connection with the transfer is permissible. In view of the facts recorded hereinabove, in our considered opinion, payment has nexus with the transfer of shares as per the terms of Compromise. Accordingly, this question is answered in favour of the assessee and against the Revenue.
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2021 (7) TMI 1365 - AUTHORITY FOR ADVANCE RULING, ANDHRA PRADESH
Exemption from GST - Mango Pulp/puree - can be treated as fresh fruit or not - whether the mango pulp/puree falls under the heading 20079910 or 0804 or 2008? - rate of tax payable on outward supplies of Mango fruit pulp/puree under the GST Act - HELD THAT:- In the instant case, the mangoes procured by the applicant are not marketed either in the same state or in frozen/chilled state of the same as fresh fruit. Hence, the entry under 0804 as claimed by the applicant is not applicable - It is evident from above that Headings 2007 and 2008 do not apply to the goods under discussion i.e., 'Mango Pulp/Puree' ,which are nothing but fruit pastes. Hence the claim of the applicant is non-applicable in the present context. The tariff rate of Mango Pulp had undergone changes over a period of time.
As there is no specific entry under GST tariff meant for this product 'mango pulp/puree', the entry no. 453 of Schedule -III of Notification No. 1/2017-Central Tax (Rate) dt: 28.06.2017 is applicable, which is a residuary entry covering goods which are not specified in Schedules I, II, IV, V, VI of the Notification, attracting the tax rate of 18%.
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2021 (7) TMI 1364 - AUTHORITY FOR ADVANCE RULING, ANDHRA PRADESH
Concessional rate of GST - Composite supply of works contract - construction services provided by the applicant to APIIC - Government entity or not - applicability of GST at 12% as prescribed in SLNo.3(vi) of the Notification no. 11/2017- Central Tax (Rate) dated 28.06.2017, as amended - appropriate rate and classification of GST to be charged by the applicant - whether M/s. APIIC is a Government Authority/Entity or otherwise? - HELD THAT:- Andhra Pradesh Industrial Infrastructure Corporation Ltd. (APIIC) was formed in 1973 by GO No: 831 dated: 10.09.1973 issued by Government of Andhra Pradesh. As seen from the share holding ratios of the 41st Annual Report for the years 2013-2014 as made available by APIIC website https://www.apiic.in, the Government of Andhra Pradesh including its nominees have 100% of share holding and thus it is covered under the definition of 'Government Entity' under the above said provisions. Therefore, we conclude that M/s. APIIC is a “Government Entity” for the purpose of GST matters.
Whether the construction work in which the applicant is engaged in is meant for any business or otherwise? - HELD THAT:- The activities of M/s APIIC are business activities and not otherwise. The applicant claims that the works involved in the contract i.e., the RBF sheds are used by none other than the organisation (APIIC) itself. But a detailed examination of the activities of APIIC prove that the organisation runs on a business model as it would pass on any costs involved in its transactions to the end client. This would be sufficient enough to come to a conclusion that the said construction is for use of APIIC for conducting its activities, which are essentially business oriented and hence not eligible for concessional rate of 12% available under Notification No.24/2017 - CT (Rate) dated 21.09.2017.
The contract entered by the applicant is classifiable under SAC heading No. 9954 under construction services, with entry no (ii) of serial No.3 of notification no. 11/2017 Central Tax (Rate) dated 28.06.2017 i.e., Composite Supply of Works Contract as defined in clause 119 of Section 2 of Central Goods and Services Act, 2017 and the applicable rate of tax is 18%.
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2021 (7) TMI 1363 - AUTHORITY FOR ADVANCE RULING, ANDHRA PRADESH
Exemption from GST - transaction of hiring/leasing of buses by the APSRTC to the Public Transport Division (PTD) of Government of Andhra Pradesh - applicability of Entry 22 of Notification No: 12/2017 Central Tax (Rate) - HELD THAT:- In the instant case, it is clear that the Government of Andhra Pradesh had created a separate undertaking under the name and style of 'Public Transport Department' (PTD) which will operate under the Administrative control of Transport, Road and Buildings Department - Thus, the 'Department of Public Transport' fits into the above definition of 'Undertaking', meant for 'Transport' carried by the State Government.
Thus, the transaction of hiring/leasing of buses by the APSRTC to the Public Transport Division (PTD) of Government of Andhra Pradesh is eligible for the exemption under Entry 22 of Notification No 12/2017 Central Tax (Rate).
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2021 (7) TMI 1362 - AUTHORITY FOR ADVANCE RULING, ANDHRA PRADESH
Input Tax Credit - applicability of Time Limitation or not - tax invoice dated 01.04.2020 issued by the supplier of service for the rental service supplied for the period 01.04.2018 to 31.03.2019 - sub-section (4) of Section 16 of the CGST/SGST Act, 2017 - HELD THAT:- In the instant case the 'tax invoice' is issued by the lessor on 01.04.2020 for the services supplied in the financial year 2018-2019. For any transaction, the tax invoice is the primary document evidencing the supply and vital for availing input tax credit.
In the instant case, the invoice which was raised on 01.04.2020 does not pertain to that financial year of 2020-2021, but pertains to the financial year of 2018-2019 in which the services were received. Moreover, as per section 16(4) the applicant was mandated to claim input tax credit before the due date of furnishing of the return under section 39 for the month of September 2019 following the end of financial year 2018-2019 to which such invoice pertains or furnishing of the relevant annual return for the year 2018-2019, whichever is earlier.
In such a context, it is opined that the applicant is not entitled to take credit of input tax under section 16(4) as it does not fulfill the basic condition that the invoice should pertain to the financial year 2018-2019 where in the supplies are made and for which the tax invoices are supposed to be raised as prescribed by the act. Thus, Act necessitates the applicant to claim input tax credit as per the conditions prescribed under the act.
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2021 (7) TMI 1361 - AUTHORITY FOR ADVANCE RULING, ANDHRA PRADESH
Works Contract or not - Contract with Andhra Pradesh Eastern Power Distribution Company Limited (APEPDCL) for extension of electricity lines taxability of the supply made by the applicant to APEPDCL relating to “Erection of S-Ph 16KVA DTRs, 6.3KV & LT lines to extend Grid supply to Tribal habitations which were already electrified with DDG Projects in Srikakulam and Visakhapatnam Circles on partial turnkey basis under Tribal Sub-Plan (TSP) - APEPDCL can be treated as a limb of Government of AP or not - rate of tax - SAC/HSN Code - HELD THAT:- On examination of Memorandum of Association of the APEPDCL Company, the main objects to be pursued by the Company on its incorporation are to engage in the business of procurement, supply and distribution of electricity; to take over the distribution and supply of electricity business from the Transmission Corporation of Andhra Pradesh Limited; to acquire business/companies; to acquire know-how etc. Thus, the incorporation of the company itself is based on business purposes. Thus, the services were provided by the applicant to a business entity i.e., APEPDCL in the present context. It is an undeniable fact that APEPDCL is not rendering any non commercial services but receiving payment/reimbursement for its commercial activity from the Government of A.P. in form of 100% grants.
Finally, even though APEPDCL has been considered as a 'Government entity', the services provided by the applicant are proved to be for the use of business purpose. Hence, The Applicant is not entitled for the benefit of concessional rate of GST @12% (6% under Central tax and 6% State tax) in terms of Notification No.24/2017-Central Tax (Rate) dated:21.09.2017 read with Notification No.31/2017-Central Tax (Rate) dated: 13.10.2017.
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2021 (7) TMI 1360 - AUTHORITY FOR ADVANCE RULING, ANDHRA PRADESH
Classification of GST - processing of raw material by cutting/sawing into different sizes starting from 30CM X 30CM to 60CM X 90CM based on requirements of the customers and finally the product is used mainly for flooring in foreign countries - classified under the HSN code 25140000 or under the HSN code 6803000? - HELD THAT:- Basing on the applicant's description of the product and processes that it under goes, it is evident that the goods under dispute are slate stone that is trimmed and cut into sizes as per the requirement of the clients. After going through the photographic evidences submitted by the applicant, it is observed that there is no workmanship involved at any stage of the entire process of the making of the final product. The activity under taken by the applicant is just cutting/ sawing the slate stone into different sizes. Apart from cutting of the stone into standard pre determined sizes the applicant does not take up any other special activity.
Taking note of the factual position, it has been considered that the product under goes only 'processing' and retains its original character. At any point of time in the entire process it had neither under gone any 'manufacturing' activity involving workmanship nor had been transformed into a different commodity.
Thus, the said product can be classified under SI.No. 122 of Chapter / Heading / Sub-heading / Tariff item of 2514 "Slate, whether or not roughly trimmed or merely cut, by sawing or otherwise, into blocks or slabs of a rectangular (including square) shape" vide notification no 1/2017-Central Tax (Rate) dt:28.06.2017.
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2021 (7) TMI 1359 - AUTHORITY FOR ADVANCE RULING, ANDHRA PRADESH
Exemption from GST - Mango Pulp/puree - can be treated as fresh fruit or not - whether the mango pulp/puree falls under the heading 20079910 or 0804 or 2008? - rate of tax payable on outward supplies of Mango fruit pulp/puree under the GST Act - HELD THAT:- In the instant case, the mangoes procured by the applicant are not marketed either in the same state or in frozen/chilled state of the same as fresh fruit. Hence, the entry under 0804 as claimed by the applicant is not applicable - It is evident from above that Headings 2007 and 2008 do not apply to the goods under discussion i.e., 'Mango Pulp/Puree' ,which are nothing but fruit pastes. Hence the claim of the applicant is non-applicable in the present context. The tariff rate of Mango Pulp had undergone changes over a period of time.
As there is no specific entry under GST tariff meant for this product 'mango pulp/puree', the entry no. 453 of Schedule -III of Notification No. 1/2017-Central Tax (Rate) dt: 28.06.2017 is applicable, which is a residuary entry covering goods which are not specified in Schedules I, II, IV, V, VI of the Notification, attracting the tax rate of 18%.
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2021 (7) TMI 1358 - MADRAS HIGH COURT
Validity of SCN - Notice challenged on the limited ground that it was issued with prejudged and foreclosed mind - HELD THAT:- No writ against a show-cause notice is entertainable. The writ against the show-cause notice needs to be entertained only if the said show-cause notice is issued by the incompetent Authorities having no jurisdiction or an allegation of malafides are raised and in such an event, the authority against whom such an allegation is raised shall be impleaded as a party respondent in its personal capacity in writ proceedings. Thus, in all circumstances, show-cause notices issued are to be responded and the authorities are bound to consider the objections, explanations and documents and thereafter, take a decision and pass orders by affording the opportunity to the assessees concerned - This being the procedures to be followed, at the stage of show-cause notice, the petitioner cannot be construed as aggrieved person as far as the merits involved in the allegations.
This Court cannot undertake the process of adjudication of disputed facts on merits. Such an exercise is to be done by the Authorities Competent, based on the documents and evidences available. The power of judicial review under Article 226 of the Constitution of India, scrutinize the processes through which a decision is taken by the Authorities in consonance with the provisions of the statutes and the Rules but not the decision itself - this Court is of an opinion that the petitioner has not raised any acceptable ground regarding the jurisdiction and malafides. Thus, the petitioner has to respond to the impugned showcause notice by filing their objections and materials, if any and in the event of receiving the said objections, the respondents are bound to consider the same by providing an opportunity to the petitioner and take a decision and pass final orders on merits and in accordance with law as expeditiously as possible.
Petition disposed off.
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2021 (7) TMI 1357 - NATIONAL COMPANY LAW TRIBUNAL KOLKATA
Maintainability of petition - separate identity of holding and subsidiary companies - scope of the expression, "member" occurring in section 241, 242 and 244 of the petition - Should it be read narrowly and strictly in terms of the definition in section 2(55) of the Companies Act, 2013, or should it be given a little expansive meaning so as to include with its fold a beneficial owner of shares? - Can a Significant Beneficial Owner (SBO) of the shares of a holding company rappel straight into a subsidiary without coursing through the holding company? - Should the identities of the holding company and its wholly owned subsidiary be blurred so as to be so unidentifiable and practically indistinguishable?
As Per Rajasekhar V.K., Member (J):
HELD THAT:- Section 89(10) defines "beneficial interest" in a share to include, directly or indirectly, through any contract, arrangement or otherwise, the right or entitlement of a person to - (i) exercise or cause to be exercised any or all of the rights attached to such share; or (ii) receive or participate in any dividend or other distribution in respect of such share - Therefore, for a beneficial interest to be recognised, forms are required to be filed both by the registered owner of the shares as well as by the person holding beneficial interest in the shares. Without that, it is not possible for a company to recognise the beneficial owner of a share. In the case of the Subject Companies, at least upto the filing of the petitions, the holding company, VTL, had not filed or recognised the APL Committee as the beneficial owner of the shares in any of the Subject Companies.
Coming back to the definition of 'Member,' it is trite law that when a word has been defined, that definition should prima facie be applied wherever that word is used in a statute. It is assumed that the legislature is fully alive to the definition, and has intended that the term as defined shall govern what is proposed under that enactment. It is an exhaustive definition and not an inclusive one, leaving no interstices for judicial intervention. Reading the provision of 'Member' in the manner that I have been invited to do by the learned senior counsel for the petitioner, will be doing violence to the language of the statute. Therefore, on this ground, the petitioners have no locus to maintain the present petitions.
The petitioners' case is that the forms regarding beneficial interest were filed with the Subject Companies on 09.12.2019. However, it is the claim of Mr. RP Singh, director, that these forms were never brought to the notice of the board of directors. This allegation has remained uncontroverted even though much has been said in the space of the four days allotted for the hearing. Even after Mr. Ranjan Bachawat, learned senior counsel for R5, specifically raised this during the course of his arguments, this was brushed aside as of no consequence by Mr. Joy Saha in his rejoinder arguments, and that these cannot be raised by R5 who was an independent director.
On record, there was absolutely no action of any consequence, save and except that the RoC seems to have been cajoled into marking the Subject Companies as being under 'management dispute.' This was chicanery on the part of the Subject Companies, since on 22.04.2021, there was no management dispute. The boards of the Subject Companies were united in their decision that VTL should not be allowed to have its way. What was there was that the 100% shareholder was attempting to infuse new directors into the board - If the boards of the Subject Companies were aggrieved, they did not challenge it then at the relevant point of time. Instead, in the present petition, there is a prayer for interim relief of mandatory injunction restraining the new inductees from representing or holding themselves out as directors of the subject companies, without a corresponding challenge the holding of the EGM of 22.04.2021 at which they got appointed. There is also a final prayer that the new inductees should be removed from the boards.
Applying the facts to the provisions of section 241, 242 and 244, where all three sections use the expression "Member," it is not possible to read the term to include persons who are, to borrow a term in familial relationships, "once removed" from the company, i.e., who would at best be treated as beneficial owners of shares in the holding company that holds 100% of the shares of the Subject Companies. One must continually remind oneself not to get too carried away to ignore the statute and guard against attempts to read equity into every act at the cost of the statute itself from where one takes appointment.
There is no statutory requirement that the shareholders of a company have to give reasons to justify reasons for removing directors. The authorities in which it has been held to be so are too numerous to be recounted here. Suffice it to say that a board or its constituent members can be in office only so long as it enjoys the confidence of a majority of the shareholders. It is also an established principle of law that a shareholder holding the requisite minimum number of shares can always requisition an EGM for removal or for appointment of a director.
The effect of these discussions is that the petitions are deemed to be not maintainable, on facts and in law. There is also the small matter of the territorial jurisdiction issue to be overcome, because this is, properly viewed, a case of action directly primarily against VTL whose registered office is situated in the State of Madhya Pradesh.
As per Harish Chander Suri, Member (T):
The present petition is very much maintainable, because for granting injunction, the Courts or for that matter this Tribunal cannot strictly go by the legislated law, it has the discretion in the specific circumstances, and those circumstances do exist in the present case because there is a long history of litigation between the parties and there are orders subsisting and binding on this Tribunal. Unless and until the whole controversy between the 'Member' vs. 'Significant Beneficial Owner', which for the present is a grey area and does not have so many binding judicial precedents, views and authorities of the higher courts clinching the issue, is settled in the final hearing of these petitions, the Injunction Orders sought by the petitioner have to be granted. The balance of convenience is more or less straight but certainly it tilts in favour of the petitioners on certain points because if the interim relief prayed for is not granted, and the EGMs are allowed to be held by the concerned respondents with the newly appointed Board members or for removing the existing members, and certain unpalatable decisions are taken which are not in favour of respondent no. 1 company, the whole purpose of the appointment of the APL Committee/petitioner no. 1, by the Hon'ble High Court will become meaningless and frustrated, which would result in further multiplicity of litigation.
Petition disposed off.
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2021 (7) TMI 1356 - ITAT DELHI
Computation of profits under the presumptive provision of section 44BB - Receipts on account tools lost in hold as includible in the gross receipts - case of the assessee is that the said receipt is of capital in nature and hence not chargeable to tax - CIT held that the amount received by the assessee on account of ‘equipment lost in hole’ is not includible in the gross revenue for the purpose of computation of profits under the presumptive provisions of section 44BB of the Act, when the said provisions are a complete code of taxation in themselves and do not distinguish between revenue and capital receipts having made allowance for expenditure including depreciation on capital assets to the extent of 90% of gross revenue - HELD THAT:- This issue has been decided by the Hon’ble Uttarakhand High Court in asessee’s own case [2019 (4) TMI 1177 - UTTARAKHAND HIGH COURT] which has been confirmed by the Hon’ble Supreme Court [2017 (11) TMI 78 - SUPREME COURT]
Receipts on account of services tax - Assessee has claimed that service tax has no profit element in it and is collected on account of statutory requirement and, therefore, it is not taxable u/s.44 BB of the Act. The AO took the view that service tax has the profit element and, therefore, includible in the gross turnover of the assessee. This issue has also been considered by the Hon’ble Uttarakhand High Court in assessee’s own case [2019 (4) TMI 1177 - UTTARAKHAND HIGH COURT] - nce the issue is now well settled in favour of the assessee and against the revenue we do not find any reason to interfere with the findings of the CIT(A). The grounds relating to this issue are also dismissed.
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2021 (7) TMI 1355 - NATIONAL COMPANY LAW TRIBUNAL, MUMBAI BENCH COURT III
Maintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors - OTS (One Time Settlement) sanctioned to the Corporate Debtor - existence of debt and dispute or not - HELD THAT:- The Company Petition is nothing but a second round of litigation. The earlier company petition bearing no. 4086 of 2018 was withdrawn by the applicant on account of OTS (One Time Settlement) sanctioned to the Corporate Debtor. Except paying upfront amount of 10 crores, the Corporate Debtor did not adhere to the compliance of the remaining terms of the OTS despite availing nearly two years’ time.
Thus, the debt and default are admitted in this case and the debt is also within limitation. The application is complete in all respects and the Financial Creditor also suggested the name of Mr. Vijay Pitamber Lulla as Interim Resolution Profession along with his consent letter in Form II. Thus, the present Company Petition satisfies all the necessary legal requirements for admission.
Petition admitted - moratorium declined.
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2021 (7) TMI 1354 - HIMACHAL PRADESH HIGH COURT
Recovery of dues - priority of claims - petitioner being “Secured Creditor”, has preference over the respondent-State with regard to the debts due from the private respondent or not - HELD THAT:- Reliance placed in the judgment passed by this Court PUNJAB NATIONAL BANK AND ANOTHER VERSUS STATE OF HIMACHAL PRADESH AND OTHERS [2021 (5) TMI 1026 - HIMACHAL PRADESH HIGH COURT], as it has not been disputed by the State that the issue involved in this writ petition is, in fact, covered by the judgment, where it was held that This Court has no hesitation in holding that the petitioners being “Secured Creditors” have preference over the respondent-State with regard to the debts due from respondent No. 4.
This writ petition is allowed by holding that the findings in the said case shall mutatis mutandis apply to this petition also - The petitioner being “Secured Creditor”, has preference over the respondent-State with regard to the debts due from the private respondent(s) and the respondent-Department cannot claim first charge over secured assets of the petitioner belonging to the private respondents, as the petitioner has first charge over the secured assets, in view of the provisions of the SARFAESI Act 2002 and Recovery of Debts and Bankruptcy Act, 1993, as amended from time to time.
Writ petition disposed off.
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2021 (7) TMI 1353 - HIMACHAL PRADESH HIGH COURT
Recovery of dues - whether it is the “Secured Creditor” or the “Revenue”, which has preference over the debts due to the Banks and Financial Institutions and this Court has not adjudicated any rights or disputes intra the petitioner Bank and the private respondent(s)? - HELD THAT:- This writ petition is disposed of by holding that the findings returned in PUNJAB NATIONAL BANK AND ORS. VERSUS STATE OF HIMACHAL PRADESH AND ORS. [2021 (5) TMI 1026 - HIMACHAL PRADESH HIGH COURT] shall mutatis mutandis apply to this petition also and the petitioner being “Secured Creditor”, has preference over the respondent State with regard to the debts due from the private respondent(s) and the respondent Department cannot claim first charge over secured assets of the petitioner belonging to the private respondents, as the petitioner has first charge over the secured assets, in view of the provisions of the SARFAESI Act 2002 and Recovery of Debts and Bankruptcy Act, 1993, as amended from time to time. It is further held that the provisions of Section 26 of the H.P. VAT Act, 2005 shall have to give way to the provisions of Section 26E of the SARFAESI Act 2002 and Section 31B of the RDB Act, 1993.
Application disposed off.
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