|
Advanced Search Options
Case Laws
Showing 141 to 160 of 1597 Records
-
2022 (3) TMI 1457 - SC ORDER
Seeking grant of bail - petitioner is the master mind and cheated innocent people or not - offence under Sections 406,419, 420, 467, 468, and 471 IPC - HELD THAT:- We are of the considered view that the petitioner is entitled to be released on bail as charges have been framed and there is no likelihood of the trial being completed soon. Also, there is no dispute that the other accused have been released on bail. The apprehension of the prosecution about the petitioner fleeing from justice or making himself scarce during the course of trial, can be taken care of by imposing conditions.
We direct the release of the petitioner on bail subject to the satisfaction of the trial Court. In addition, the petitioner is directed to deposit his passport and report to the Rani Bagh Police Station, Delhi in the 1st week of every month.
SLP disposed off.
-
2022 (3) TMI 1456 - ITAT KOLKATA
Revision u/s 263 by CIT - disallowance of amount u/s 35 and claim debited towards advertisement in the Profit & Loss A/c, as prior period expenses, which deserves to be disallowed - HELD THAT:- As on perusal of the observations and finding/direction given by the Ld. PCIT shows that no examination and verification has been done by the Ld. PCIT before arriving at the consideration of holding assessment order being erroneous in so far as it is prejudicial to the interest of the revenue.
PCIT in the present case has not carried out any enquiry of his own and has merely set aside the assessment to the file of the AO to re-examine the issue of claim of advertisement expenses alleged to be held as prior period expenses. Therefore, it is contrary to the guidelines as mandated in the Hon'ble Delhi High Court decision in the case of ITO v. DG Housing Projects Ltd. [2012 (3) TMI 227 - DELHI HIGH COURT]. Accordingly, the consideration arrived at by the Ld. PCIT invoking provisions of section 263 is not justified and cannot be sustained under the facts and circumstances of the present case.
We find that Ld. PCIT has taken note of the amendment made in section 263 w.e.f. 01.06.2015. This amendment relates to Explanation 2 inserted in section 263 of the Act. The co-ordinate bench has dealt with Explanation 2 as inserted by the Finance Act, 2015 in the case of Narayan Tatu Rane v. Income Tax Officer [2016 (5) TMI 1162 - ITAT MUMBAI] to hold that the said Explanation cannot be said to have overridden the law as interpreted by the Hon'ble Delhi High Court in DG Housing Projects Ltd (supra), according to which the Ld. PCIT has to conduct an enquiry and verification to establish and show that the assessment order is unsustainable in law. Also further held that the intention of the legislature could not have been to enable the Ld. PCIT to find fault with each and every assessment order, without conducting any enquiry or verification in order to establish that the assessment order is not sustainable in law, since such an interpretation will lead to unending litigation and there would not be any point of finality in the legal proceedings. The opinion of the Ld. PCIT referred to in section 263 of the Act has to be understood as legal and judicious opinion and not arbitrary opinion.
On the two issues considered by the Ld. PCIT in the impugned order, no action u/s 263 of the Act is justifiable which cannot be sustained under the facts and circumstances of the present case and judicial precedents dealt herein above. We, therefore, quash the impugned order u/s 263 of the Act and allow the grounds raised by the assessee.
-
2022 (3) TMI 1455 - ITAT BANGALORE
TP Adjustment - MAM - rejection of internal CUP selected by assessee as most appropriate method by the revenue authorities - HELD THAT:- As the submissions advanced are on identical facts that has already been considered by this Tribunal, for preceding assessment years as well as assessment year 2015-16 [2020 (3) TMI 471 - ITAT BANGALORE] respectfully following the above view, we direct the Ld.TPO to replace the TNMM with CUP as most appropriate method
Treatment of AMP expenses pertaining to trading segment as an international transaction and determining the ALP in respect of the same - HELD THAT:- We uphod CPM to be the MAM in computing the ALP of the trading segment. Further, based on the categorical observation by the Ld.TPO regarding the trading segment to be at arm’s length, we direct the Ld.AO/TPO to delete the adjustment proposed, in respect of the AMP expenses as it cannot be treated as international transactions in the present facts of the case.
Disallowance of provision of warranty - allowable revenue expenses u/s 37 - HELD THAT:- As noted that coordinate bench of this Tribunal in assessee’s own case for assessment years 2006-07 [2016 (5) TMI 1524 - ITAT BANGALORE], AY 2007-08, AY 201011 [2017 (3) TMI 1835 - ITAT BANGALORE] upheld that provision for warranty has been created on a scientific basis and hence allowable as expenditure under section 37 under the Act.
Thus in assessee’s own case for preceding and subsequent assessment years relying of the decision of the Hon’ble Supreme Court in the case of Rotork Controls India Pvt.Ltd [2009 (5) TMI 16 - SUPREME COURT] we hold that provision for warranty expenditure is allowable.
Disallowance of provision for leave encashment - AO rejected the submission of assessee and held that provision for leave encashment is being unascertained liability was liable to be disallowed under section 43B - HELD THAT:- We note that coordinate bench of this Tribunal in assessee’s own case for AY 2011-12 has held that leave encashment is not a contingent liability, and that, the same ought not to be disallowed while computing income under normal provisions of the Act.
MAT computation u/s 115JB - warranty and provision for leave encashment as an 'unascertained liability' and added the same to book profits under section 115JB - HELD THAT:- As following the ration laid down by Hon’ble Supreme Court in case of Rotork Control [2009 (5) TMI 16 - SUPREME COURT]. we have held that the provision for warranty cannot be treated as unascertained liability. In respect of provision of leave encashment, this Tribunal in assessee’s own case for AY 2011-12 has observed that provision for leave encashment need not to be added back to book profits for the purpose of determining tax liability u/s 115JB of the Act
Thus no merit in the manner in which the book profits for purposes of section 115JB has been computed.Accordingly we direct the Ld.AO to exclude the two items from the book profits for purpose of computing tax liability under section 115JB of the Act.
Assessee appeal allowed.
-
2022 (3) TMI 1454 - DELHI HIGH COURT
Reopening of assessment u/s 147 - procedure prescribed in the substituted Sections 147 to 151 w.e.f. 01st April, 2021 - scope of mandatory procedure prescribed u/s 148A - relation between Relaxation Act, 2020 and Finance Act, 2021 - enhanced/reduced time limit specified in Section 149 - initiation of reassessment proceedings prior to coming into force of the Finance Act, 2021 - substitution made by the Finance Act, 2021 - onset of Covid-19 pandemic followed by nationwide lockdown in March, 2020 - Relaxation of certain provision of specified Act - HELD THAT:- Explanations A(a)(ii)/A(b) to the Notifications dated 31st March, 2021 and 27th April, 2021 are declared to be ultra vires the Relaxation Act, 2020 and are therefore bad in law and null and void.
Consequently, the impugned reassessment notices issued under Section 148 of the Income Tax Act, 1961 are quashed and the present writ petitions are allowed. If the law permits the respondents/revenue to take further steps in the matter, they shall be at liberty to do so. If and when such steps are taken and if the petitioners have a grievance, they shall be at liberty to take their remedies in accordance with law.
-
2022 (3) TMI 1453 - SUPREME COURT
Demand of interest - Period during which recovery of license fee under Section 36 of the Act was stayed by the High Court and eventually when the writ petition was dismissed. - The High Court held that the respondent was not liable to pay interest as he was under the protection of the interim order. Given the settled position of law, in our view the High Court has erred in holding that the respondent was not liable to pay interest due to the protection given under the interim order.
HELD THAT:- Imposition of a stay on the operation of an order means that the order which has been stayed would not be operative from the date of passing of the stay order. However, it does not mean that the stayed order is wiped out from the existence, unless it is quashed. Once the proceedings, wherein a stay was granted, are dismissed, any interim order granted earlier merges with the final order. In other words, the interim order comes to an end with the dismissal of the proceedings.
In such a situation, it is the duty of the Court to put the parties in the same position they would have been but for the interim order of the court, unless the order granting interim stay or final order dismissing the proceedings specifies otherwise. On the dismissal of the proceedings or vacation of the interim order, the beneficiary of the interim order shall have to pay interest on the amount withheld or not paid by virtue of the interim order.
Decided in favor of revenue.
-
2022 (3) TMI 1452 - ORISSA HIGH COURT
Demand of differential duty - no final assessment order have been passed (although various dates have been mentioned) by following the principles of natural justice and/or any speaking order so as to have proper adjudication before the Appellate forum - principles of natural justice - HELD THAT:- Issue formal notice for 18th April, 2022.
Till the next date, no coercive steps shall be taken for recovery of the demand of differential duty qua the said 36 bills of entry.
-
2022 (3) TMI 1451 - ITAT MUMBAI
Eligibility of claim of deduction u/s 35(1)(iii) - Claim denied as donation paid by the assessee is an accommodation entry and is not a business claim - AR submitted that the assessee has made donation genuinely and obtained the receipts and the transaction satisfied the conditions required for claiming the exemption/deduction - HELD THAT:- We find the Hon’ble Tribunal in the case of M/s Sopariwala Exports Pvt Ltd [2021 (7) TMI 442 - ITAT MUMBAI] has dealt on the identical facts and granted the relief.
We find the facts of the present case are similar in respect of donation u/sec35(1)(ii) of the Act and we respectfully follow the judicial precedence and set aside the order of the CIT(A) and direct the Assessing officer to delete the addition and allow the ground of appeal in favour of the assessee.
-
2022 (3) TMI 1450 - MADRAS HIGH COURT
Condonation of delay of 884 days in filing necessary application to revoke the succession certificate granted by this Court - HELD THAT:- Though the respondents/petitioners have obtained succession certificate, the applicants, who claim to be the second wife and adopted daughter of the deceased R.Kapanipathi Rao, have come forward with the present application to revoke the said succession certificate - Whether the first applicant and second applicant are the second wife and adopted daughter of the deceased, or not, or whether the first applicant has got any testimony, can be decided not in this application, however, the Court has to see whether the reasons are sufficient to allow the application.
On being satisfied with the averments stated in the affidavit filed in support of the application and also considering the submissions made by the learned counsel on either side, the delay is condoned.
Application allowed.
-
2022 (3) TMI 1449 - SECURITIES APPELLATE TRIBUNAL MUMBAI
Offence under SEBI Act - Mobilisation of the funds - violation of the CIS Regulations - Prohibition of manipulative, fraudulent and unfair trade practices - Violation of the provisions of Section 12(1B) of the SEBI Act read with Regulation 3 of CIS Regulations and Regulation 4(2)(t) of the PFUTP Regulations - Scope of definition of fraud - monetary penalty of Rs.20 crores to be paid jointly and severally by the appellant, the Company and its Directors - HELD THAT:- In the instant case, we have gone through the entire impugned order and we do not find any finding to indicate that the appellant committed a fraud in the mobilisation of the funds. In the absence of any finding of fraud the charge of violating Regulation 4(2)(t) of the PFUTP Regulations cannot be proved. We are satisfied that in the absence of any finding of fraud against the appellant there is no violation of Regulation 4(2)(t) committed by the appellant.
Regulation 4(2)(t) provides illegal mobilisation of funds. The impugned order does not show any iota of evidence that the appellant was involved in the illegal mobilisation of funds after he joined as a Director. Admittedly, the appellant was appointed as a Director in 2010. Majority of the schemes floated by the Company was already launched prior to the appellant’s appointment as a Director. There is no finding by the Adjudicating Officer that such and such scheme was launched during the period when the appellant became a Director nor there is any finding that the appellant was responsible in the mobilisation of the funds under those schemes.
The finding that no evidentiary proof has been filed by the appellant that he is not an officer in default or that he did not attend the board meeting when such scheme was launched is patently erroneous. The burden has wrongly been placed upon the appellant. A charge has been levelled against the appellant, namely, violation of Regulation 4(2)(t). The responsibility to prove the charge is upon the prosecution, namely, upon SEBI. It is for the respondent to prove that the appellant was an officer in default or that he attended the meeting when a scheme was launched. It cannot be presumed that the appellant must have been present in the meeting of the board of directors when the scheme was launched. We are satisfied that in the instant case SEBI has failed to discharge its burden.
In any case, the finding of the Adjudicating Officer that the appellant and other Directors are officers in default is totally misplaced. Under Section 5(g) of the Companies Act, 1956 all Directors can be treated as officers in default only when there is a finding that there was no Managing Director or designated person who was responsible for the mobilisation of the funds. We find that there is no finding that the Company did not have any designated person or Managing Director and, therefore, all Directors would be deemed to be officers in default.
Penalty under Section 15HA can be imposed if a person indulges in fraudulent or unfair trade practices. We have already held that the appellant has not indulged in fraudulent and unfair trade practice and, therefore, no penalty under Section 15HA could be imposed.
In the light of the aforesaid, the impugned order in so far as it relates to the appellant cannot be sustained and is quashed. The appeal is allowed. Attachment orders, if any, on the appellant’s demat account, bank account etc. shall be lifted forthwith. All the misc. applications are also accordingly disposed of. In the circumstances of the case parties shall bear their own costs.
-
2022 (3) TMI 1448 - ITAT MUMBAI
TP Adjustment - adjustment in the arm's length price in respect of the interest charged on the advances by the appellant companies to its AE Virgo Europe SPA - whether LIBOR is to be taken as the basis of interest benchmarking for foreign currency denominated loans or whether Indian PLR will be relevant? - HELD THAT:- In the case of CIT Vs Tata Autocomp Systems Ltd [2015 (4) TMI 681 - BOMBAY HIGH COURT] concluded that ALP in the case of loans advanced to Associate Enterprises would be determined on the basis of rate of interest being charged in the country where the loan is received/consumed.
The stand of the authorities below in replacing the LIBOR with Indian PLR cannot be upheld. It is not even the case of the revenue authorities that the basis points above the LIBOR are inadequate or too low. Accordingly, benchmarking by the assessee cannot be faulted with. We delete the impugned ALP adjustment. The assessee gets the relief accordingly.
Adjustment value of the pledge of shares - HELD THAT:- We find that there is no dispute that the shares are pledged, at the instance of or and for the benefit of, an associated enterprises of the assessee, keeping this in mind, when we look at definition of “ transaction” in section 92F(v), it is clear that “transaction includes an arrangement, understanding or action in concert-(A) whether or not such arrangement, understanding or action in concert is formal or in writing; or (B) whether or not such arrangement, understanding or action is concert is intended to enforced by legal proceedings”. It cannot, therefore, be said that pledging shares for the benefit of an associated enterprises is not a transaction between the associated enterprise. It is akin to a corporate guarantee and is, therefore, required to be benchmarked as such.
What is the rate at which such corporate guarantee is to be benchmarked, and whether a corporate guarantee constitutes international transaction at all? - As relying on case of Siro Clinpharm Pvt. Ltd [2021 (10) TMI 754 - ITAT MUMBAI] we uphold the action of the authorities below in principle but we scale down the ALP adjustment to 0.5% of the correct value of shares and for the actual pledge period. To this extent, the assessee will get relief.
Penalty u/s. 271(1)(c) - Issuance of corporate guarantees did not constitute an international transaction under section 92B, as it had no bearing on the profits, income, losses or assets of the enterprise giving such guarantee. This stream of decisions included decisions as in the cases of Micro Ink Ltd [2015 (12) TMI 143 - ITAT AHMEDABAD], Siro Clinpharm Pvt. Ltd [2016 (5) TMI 633 - ITAT MUMBAI], Bharti Airtel Ltd [2014 (3) TMI 495 - ITAT DELHI] In view of this position, it cannot be said that assessee's explanation that the guarantee given by the pledge of shares did not constitute international transaction was not a reasonable explanation. Accordingly, it was not a fit case for imposition of penalty u/s. 271(1)(c).
-
2022 (3) TMI 1447 - ITAT COCHIN
Revision u/s 263 - deduction u/s 54 - submission that the assessee had constructed two residential houses and if at all what was available is only exemption u/s 263 in respect of one residential house - HELD THAT:- A perusal of the order u/s 263 of the Act clearly shows that even before the Pr. CIT the assessee had brought out the issue as also the decision in the case of Gita Duggal [2013 (3) TMI 101 - DELHI HIGH COURT] but the Pr. CIT has not countered the said decision either but has proceeded in para 7 to say that proper verification has not been done.
In fact the wordings used by the Pr. CIT are “it appears from the records. The words of Section 263 of the Act are “if he considers that any order passed by the AO is erroneous in so far as it is prejudicial to the interest of Revenue”. There is no question of making a prima facie view in the revision order. The error has to be specific. Also the issue raised by the Pr.CIT in the present case being a highly debatable issue the same cannot be considered as an issue which is erroneous or prejudicial to the interest of Revenue. Consequently, as the AO has taken one of the possible views it is not susceptible to the provision of revision under section 263 of the Act. The order passed under Section 263 stands quashed. Appeal filed by the assessee is allowed.
-
2022 (3) TMI 1446 - SUPREME COURT
Payments disbursed by the Liquidator - undertaking has been taken by the Liquidator that the banks would return the money if they are not entitled, in accordance with Regulation 43 of the IBBI (Liquidation Process) Regulations 2016 - HELD THAT:- Both in view of the findings which have been arrived at by the NCLAT, and the assurance which has been given to the Court by the Liquidator, it is not necessary to entertain the Appeal. The Appeal is accordingly dismissed.
-
2022 (3) TMI 1445 - ITAT SURAT
Penalty u/s 271C - LTC/LFC involving enroute foreign travel - HELD THAT:- As in assessee’s own case [2021 (2) TMI 28 - ITAT MUMBAI] estimation of income, in the hands of the employees under the head' income from salaries', by the employer was bonafide and reasonable, the very foundation of impugned demands raised under section 201 r.w.s 192 ceases to hold good in law. We must, therefore, vacate these demands.
Bearing in mind entirety of the case, we cancel the impugned demands under section 201 r.w.s. 192 as unsustainable in law, thus delete the delete the penalty. Decided in favour of assessee.
-
2022 (3) TMI 1444 - NATIONAL COMPANY LAW TRIBUNAL, KOLKATA
Seeking to set aside the e-auction held on September 13,2021 by the liquidator - company already under Liquidation process - section 60(5) of the Insolvency and Bankruptcy Code, 2016 read with Rule 11 of the National Company Law Tribunal Rule, 2016 - HELD THAT:- Assets as shown in the auction notice are mentioned as Land and Building, Plant & Machinery, Inventory, Stores and spares etc. As is evident from the record this factory is situated at Kolkata. It is admitted position that the liquidator decided to postpone the e-auction from 9th of September, 2021 to 13th of September, 2021 and fixed the submission of EMD and other documents in Calcutta for 11th of September, 2021.
Overview of the assets and properties of CD is contained at Page-56 of the bidding document. The details of document required to be submitted by the bidder start from Page-61. There is a provision for physical verification and the site visit at Page 62 and also there is a provision for conducting due diligence - Inspection for the assets of the company by the intending bidders was fixed on or before 7th of September, 2021 thus thereby giving a time of around 12 days. However, when the liquidator did not get even a single bid on or before the schedule fixed by him in his notice dated 24th of August, 2021, he extended the time by issuing the corrigendum dated 8th of September,2021 thereby extending the date of submission of EMD till 11th of September, 2021 and date of e-auction on 13th of September, 2021.
It is apparent from the facts on record, the time of completion of the liquidation process was till April, 2022 (without extension) and why there was so hurry with the liquidator to extend the time only for three days when he was having not even a single bidder in response to its first notice and at the same time inviting bids afresh without affording anyone the opportunity of conducting physical inspection of the huge and high value assets of the company and conducting due diligence and mentioned in earlier notice inviting bids, per se speaks of failure on the part of Liquidator to conduct the sale in fair and in the manner to get the maximum value of the assets - According to the applicants, reasonable time should have been granted to conduct the site inspection and due diligence when the liquidator was extending the time for want of even a single bidder.
By omitting the opportunity to the Intending Bidders, in corrigendum impugned dated 08-09-2021, to conduct physical inspection and due diligence as provided in initial bid document, it is apparent that the liquidator has not acted rationally, reasonably and failed to conduct the auction in a fair manner - Upon the basis of above-mentioned material irregularities/flaws have no option except to auction set aside the entire process, in pursuance to the e- auction notice dated 27th of August, 2021 followed by the corrigendum dated 8th of September, 2021 and the LOI issued by the liquidator to M/s Snaefell Heights LLP and the auction process impugned is hereby set aside.
Application disposed off.
-
2022 (3) TMI 1443 - NATIONAL COMPANY LAW TRIBUNAL NEW DELHI BENCH - II
Maintainability of petition - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Operational Creditors - existence of debt and dispute or not - HELD THAT:- From the two Email communications dated 21.09.2021 and 04.10.2021 from the Corporate Debtor to the Operational Creditor, evidently the Corporate Debtor has admitted its liability and a debt of more than Rs. 01 (One) crore towards the Applicant. The same is further admitted by the Ld. Counsel appearing on behalf of the Corporate Debtor during the course of final hearing on 28.03.2022.
In the given facts and circumstances, the Operational Creditor has established the default on the part of Corporate Debtor in payments of the operational debt. The Petition filed under Section 9 fulfills all the requirements of law. Therefore, the petition is admitted in terms of Section 9(5) of the IBC. Accordingly, the CIRP is initiated and moratorium is declared in terms of Section 14 of the Code.
Application allowed.
-
2022 (3) TMI 1442 - HIMACHAL PRADESH HIGH COURT
Dishonor of cheque - insufficient of funds - discharge of a legally enforceable debt or not - rebuttal of statutory presumption - section 118 and 139 of NI Act - HELD THAT:- The Hon’ble Apex Court in M/S LAXMI DYECHEM VERSUS STATE OF GUJARAT & ORS. [2012 (12) TMI 106 - SUPREME COURT], has categorically held that if the accused is able to establish a probable defence which creates doubt about the existence of a legally enforceable debt or liability, the prosecution can fail. To raise probable defence, accused can rely on the materials submitted by the complainant. Needless to say, if the accused/drawer of the cheque in question neither raises a probable defence nor able to contest existence of a legally enforceable debt or liability, statutory presumption under Section 139 of the Negotiable Instruments Act, regarding commission of the offence comes into play.
In the case at hand, complainant Ashok Kumar tendered his evidence by way affidavit, Exhibit CW-1/A and stated that the accused was in need of money, as such, requested him to lend Rs. 2,70,000/- and same was given by the complainant to the accused - True it is that in cross-examination complainant has stated that he gave some money in cash and some through bank but he could not recollect how much money was paid in cash and how much through bank. Complainant stated that there was no witness present, at the time, when he had given money to the accused, but such admission on the part of the complainant is of no benefit to the accused, when issuance of cheque and signatures thereupon of the accused stand duly admitted.
Material adduced on record clearly reveals that the complainant successfully proved on record that accused borrowed Rs. 2.70 Lakh from him and, with a view to discharge his liability, issued cheques Exhibits CW-1/B and CW-1/E, but the same were dishonoured on account of insufficient funds in the bank account of the accused. Since, despite having received legal notice, accused failed to make payment of the cheque amount, complainant rightly instituted proceedings under Section 138 of the Act against him, which subsequently came to be rightly decided in favour of complainant in the totality of evidence led on record by complainant.
This Court sees no reason to interfere with the well reasoned judgments passed by the courts below, which otherwise appear to be based upon the correct appreciation of evidence and as such, same need to be upheld. Moreover, this Court has a very limited jurisdiction under Section 397 of the Cr.PC, to re-appreciate the evidence, especially, in view of the concurrent findings of fact and law recorded by the courts below - Since after having carefully examined the evidence in the present case, this Court is unable to find any error of law as well as fact, if any, committed by the courts below while passing impugned judgments, and as such, there is no occasion, whatsoever, to exercise the revisional power.
The impugned judgments/order of conviction and sentence passed by learned Courts below are upheld - the present revision petition is dismissed.
-
2022 (3) TMI 1441 - CALCUTTA HIGH COURT
Scope of alternate appropriate remedy - Revision u/s 263 - case of the petitioners that they are not satisfied with the reasoning and findings given by the Commissioner in its impugned order - Whether this Court cannot act as an Appellate Authority and substitute the findings of an authority and appropriate remedy for the petitioners will be to file appeal before the Tribunal, against the impugned order? - HELD THAT:- This writ petition, is dismissed solely on the ground of availability of alternative remedy by way of statutory appeal. If the petitioners file appeal against the impugned order within four weeks from date, before the learned Tribunal, it will not raise the point of limitation and will decide such appeal on merits without being influenced by any observation made in this order.
Further, since the petitioners are enjoying the interim order in this matter since 7th of December, 2010, the aforesaid interim order will continue only for a period of ten weeks from date with liberty to the petitioners to make appropriate application for any interim relief before the learned Tribunal if so advised and which will be considered by the learned Tribunal strictly in accordance with law.
-
2022 (3) TMI 1440 - ITAT KOLKATA
Revision u/s 263 by CIT - As per CIT provision for interest on service tax ought to have been added back to the book profit while computing such book profit for the purpose of Section 115JB - Commissioner was of the view that it is a contingent liability and, therefore, it should form part of the book profit - HELD THAT:- A competent authority under the Service Tax has adjudicated the proceedings and quantified the demands required to be made. In other words the Commissioner Service Tax, Kolkata, has passed an executable order on the basis of which a demand can be recovered from the assessee. If that be so, how the interest liability for which a provision has been made can be construed as a contingent liability. The only reasoning available at the end of the revenue is that the assessee has challenged the order in higher appellate forum. But that would not absolve the assessee from making the payments on the basis of this order during pendency of any appellate proceedings. The revenue has nowhere demonstrated that execution of this order has been stayed and, therefore, the liability should be deemed as contingent. It is also pertinent to observe that this aspect has been accepted by the AO. It is quite debatable to construe that if an order passed by the competent authority crystallising the amount payable by the assessee, if challenged in an appeal would lose its executability unless stayed by the Appellate Authority. Therefore, to our mind regarding the first aspect the assessment order is not an erroneous one and the ld. Commissioner ought not to have exercised jurisdiction u/s 263 of the Act, on the first point.
Commissioner was of the view that the sum ought to have been included in the deemed full sale consideration for the purpose of Section 50C - Section 50C is not applicable as it is common parking space in an office premise. It is to be appreciated that parking space has to be assigned and not to be sold. Though there is a very narrow distinction between the both because if it is to be sold by the vendor, the vendee may erect a structure after obtaining the absolute right of such space. Parking spaces are not subject to sale and a rather assigned. If some structure is erected it could create problem for the co-users of the parking space. If this aspect has to be viewed with the above angle the, it will show that ld. AO has taken a plausible opinion. There might be a debate on such opinion but there should not be any action u/s 263 of the Act. Therefore, on the second point also the order of the ld. Commissioner, is not sustainable.
As far as the other show cause notices issued by Commissioner and discussed in the impugned order are concerned, on these show cause notices, he has not issued any specific directions for the assessing officer. One way to appreciate this situation would be that he might be satisfied with the explanation offered by the assessee and did not give any direction. The other way to appreciate the situation would be that he has passed an order u/s 154 - Therefore, in the present case it is neither advisable nor desirable on our end to express any opinion on those points. The scope of Section 154 is very limited. The rectification order has to be judged in an independent appeal within the parameter of such scope. Therefore, we resist ourselves from making any observation on the points contained in the other two show cause notices. The observations made by us for explaining the issues u/s 154 of the Act or on the other two show cause notices will not impair or injure the case of the revenue nor it will cause any prejudice to the defence/explanation of the assessee.
It is also pertinent to note that if the impugned order is quashed on account of some jurisdictional error then probably there could not be any rectification u/s 154. For example if the impugned order is time-barred and it is quashed then there will not be any consequential proceedings.
We are confining ourselves to a limited point that two issues have been raised under the first showcause notice. On these two issues no action u/s 263 of the Act is justifiable and, therefore, we quash the order of the ld. Commissioner to this extent. Appeal of the assessee is allowed.
-
2022 (3) TMI 1439 - KARNATAKA HIGH COURT
Seeking grant of bail - money laundering - Provisional attachment order - scheduled offences - completion of investigation of an offence under the provisions of the PMLA - would complete on issuance of an order under Section 5(1) of the said Act for provisional attachment or on filing of application under Section 5(5) of the Act for confirmation of the same or atleast when an order is passed under Section 8(3)(a) of the said Act? - person arrested subsequent to the order passed under Section 8(3)(a) of the said Act would be entitled for immediate release by applying the provisions of Section 167 (2) of Cr.PC. or not - twin conditions enumerated under the provisions of Section 45(1) of the Act is a Sine-qua-non for granting bail to an accused who has been arrested under Section 19 of the Act or not - arrest made under Section 19 of the Act is a preventive detention or not.
Whether the investigation of an offence under the provisions of the PMLA would complete on issuance of an order under Section 5(1) of the said Act for provisional attachment or on filing of application under Section 5(5) of the Act for confirmation of the same or atleast when an order is passed under Section 8(3)(a) of the said Act? - If so, if a person is arrested subsequent to the order passed under Section 8(3)(a) of the said Act would be entitled for immediate release by applying the provisions of Section 167 (2) of Cr.PC.? - HELD THAT:- It is pertinent to note that nowhere it is mentioned as to what is the time limit for filing a complaint/final report under Section 45 of the Act. However, there can not be a situation where a person is arrested and he is continued in custody eternally on the pretext that there is no time limit fixed under the Act for filing the complaint/final report as is contemplated under section 45 of the said Act. Admittedly, the proceedings under the Act is judicial proceedings. Whenever a person is arrested by the investigating agency his personal liberty is taken away by the investigating agency for a particular purpose. As is provided in Section 167 of Cr.PC., supra, if an Investigating Agency fails to file a final report as contemplated under Section 173 Cr.PC. within 60 days or 90 days as the case may be depending upon the maximum punishment prescribed in a given penal statute, the person who has been arrested by the Investigating Agency acquires indefeasible right to be released forthwith.
Even though there is no specific time limit prescribed under the Act for filing complaint/final report as contemplated under Section 45 of the Act, whenever a person is arrested by the Directorate of Enforcement under the provisions by resorting to the powers vested in it under Section 19 of the Act., the Directorate of Enforcement is expected to file a complaint/final report within 60 days from the date of arrest. In the event of failure to do so, indefeasible right is definitely to accrue to an accused under the Act.
Having regard to the scheme of the Act, especially the investigation powers is given to the Directorate of Enforcement and the proceedings before the Directorate of Enforcement in summoning the accused recording his statement, collection of evidence being treated as judicial proceedings as is found in Section 50(4) of the Act referred to supra, the said proceedings cannot be termed as completion of investigation. The proceedings that takes place before filing of the final report is for the purpose of prima facie satisfaction of the Directorate of Enforcement that a provisional attachment order was passed which needs confirmation in order to protect the assets and to put an end to the money laundering.
The arguments put forth on behalf of the petitioner that the petitioner is entitled for statutory bail under Section 167(2) of the Cr.PC., on issuance of the order passed under Section 5(1) of the Act for provisional attachment or filing an application for its confirmation before the adjudicating authority under Section 5(5) of the Act. In other words, the attachment of the property and its confirmation though is part of the same investigation, it is not for the purpose of filing the complaint under Section 45 of the Act and it is for the purpose of attachment of the property - for all practical purposes, the investigation would not be complete so as to make available a right to the petitioner for statutory bail under Section 167(2) of Cr.P.C. - questions are answered in negative.
Whether an accused is entitled for grant of bail taking note of the fact that he has been enlarged on bail in respect of predicate offences? - Whether twin conditions enumerated under the provisions of Section 45(1) of the Act is a Sine-qua-non for granting bail to an accused who has been arrested under Section 19 of the Act? - Whether an arrest made under Section 19 of the Act is a preventive detention? - Whether the petitioner has made out a case for grant of bail? - HELD THAT:- Close reading of section 45(1) of the Act makes it clear that before a court grants bail to an accused person, for an offence under the Act, an opportunity must be provided to the prosecutor to oppose the application and in the event of the prosecution opposing the application, court must be satisfied that there are reasonable grounds for believing that an accused is not guilty of such offence and he is not likely to commit any offence while on bail. Therefore, one can easily construe while exercising the power under Section 439 of Cr.PC., for grant of bail. The twin condition referred to supra must be satisfied before a court intends to grant the bail. The language employed in Section 45(1) of the Act is in the form of twin conditions akin to the language employed by the legislature under Section 37 of the NDPS Act - the court which is considering the bail application must get satisfied that there are reasonable grounds that accused may not be guilty and he may commit further offence as money laundering is a continuous offence.
The special powers vested in this court under Section 439 Cr.PC. cannot be exercised in the case of an accused facing trial under the provisions of the said Act, like any other accused who has been charged under the provisions of the IPC. Having regard to the language employed in Section 45(2), there is an embargo on the powers of this court to exercise the special powers vested in this court under Section 439 Cr.P.C. On careful reading of Section 45(2), one can easily understand that the wordings used under the said provision is in pari materia to section 37 of the NDPS Act.
This court considered the rival contentions of the parties in the light of Section 19 of the Act. Argument of the counsel for de-facto complainant that arrest under Section 19 of the Act, cannot be construed as preventive detention cannot be countenanced in law - If the said argument is to be accepted, there remains nothing for the Special Court to decide the guilt or otherwise of the accused in the trial. The opinion of the Investigating Agency is no doubt judicial in nature, having regard to Section 50(4) of the Act. But, the Special Court has to charge the accused for the offence under Section 3 of the Act after taking cognizance of the said offence when once a complaint/final report under Section 45 of the Act, is filed. If the opinion of the Investigating Agency for the purpose of arrest under Section 19 of the Act, that an accused under the Act is prima facie guilty of offence under the provisions of the Act, it is only for the purpose of arrest and not binding on the Special Court.
In the case on hand, it is no doubt true that the petitioner is enlarged on bail in respect of the predicated offences. The Investigating Agency is very well aware of the said fact. Despite the same, the investigating Agency proceeded to effect the arrest of the petitioner by resorting to the powers vested in it under Section 19 of the said Act. Therefore, the word ‘guilty’ found under Section 19 of the Act is to be construed in that sense and not as an opinion that would bind the petitioner/accused and definitely not binding on the Special courts. Thus, the argument put forth on behalf of the petitioner that ipso facto, petitioner is entitled for the bail in view of the fact that the petitioner is enlarged on bail for the predicated offences cannot be countenanced in law - the questions are answered in negative.
The petition is allowed.
-
2022 (3) TMI 1438 - ITAT MUMBAI
TP Adjustment - selection of profit level indicator(PLI) basis being operating profit by value add expenses instead of operating profit by total cost adopted by the TPO and DRP - HELD THAT:- As per ITAT for the A.Y 2015-16 selection of operating profits by value added expenses has to be considered as there is no change in assessee’s business model. We follow the judicial precedence and considering the facts presented in the course of hearing restore the disputed issue to the file of the AO / TPO with similar directions in respect of bench marking and adopting of PLI and allow the grounds of appeal for statistical purposes.
Restrictions of TP adjustments to the extent of value of international transactions - HELD THAT:- We considering the similar line of working in assessee’s own case for the A.Y 2015-16 and directions restore the disputed issue to the file of the A.O to consider the proportionate adjustments in respect of the income to the extent of international transactions and allow the ground of appeal for statistical purposes.
Inclusion of comparables - HELD THAT:- We find the comparable was functionally accepted in earlier A.Y 2011-12 & 2012-13 and for A.Y 2013-14 it was rejected as it has some extraordinary event and no segmental information was available and further the TPO has rejected the comparable on the export operations. We considering the facts, submissions, information and judicial decisions in the assessee’s own case and the department accepted it as comparable in the earlier years as discussed. We direct the TPO to include the comparable in determination of ALP. Since, one comparable is included and there are no arguments made by the Ld.AR on other comparables hence they are left open and allow the grounds of appeal for statistical purposes.
Exclusion of comparable Om Logistic Ltd. - AR submitted that the comparable company is engaged in the transportation and logistics services of vehicle and tangible assets - We direct the TPO to exclude the comparable in determination of ALP and allow the ground of appeal of the assessee.
Claim of depreciation on goodwill resulting from acquisition of business unit - HELD THAT:- As we follow the judicial precedence, and direct the Assessing officer to allow the claim of depreciation on good will and allow the grounds of appeal in favour of the Assessee.
............
|
