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Showing 41 to 60 of 1628 Records
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2022 (5) TMI 1588 - ALLAHABAD HIGH COURT
Cancellation of registration order - petitioner has remedy of Appeal under CGST/UPGST, Act, 2017 - HELD THAT:- Without expressing any opinion on merits of the case of the petitioner, this writ petition is dismissed on the ground of alternative remedy, leaving it open for the petitioner to avail remedy of appeal against the impugned order.
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2022 (5) TMI 1587 - ITAT BANGALORE
Adjustment towards stand by letter of credit (‘SBLC’) - assessee provided SBLC for and on behalf of the AE being Istanbul Sabiha Gokcen Havalimani Yatirim Yapim Veisletme A S (ISG), through assessee’s Indian bank out of non-fund based limits to the foreign lenders of the said AE. The bank charged a commission at the rate of 0.90% - 0.95% of the amount of SBLC to the assessee - TPO made adjustment of the entire commission amount charged by the bank to Assessee, stating that the risk premium to be charged by the Assessee from its AE should be the bank rate of 0.90% - 0.95% - CIT(A) granted relief to the extent of commission recovered by the Assessee from the AE and upheld the adjustment made by the Ld.TPO to the extent of the balance amount that was not recovered by the assessee from its AE
HELD THAT:- Respectfully following the above consistent view for assessment year 2014-15 [2020 (2) TMI 1708 - ITAT BANGALORE] and group concern, namely GMR Energy Ltd., for AY 2013-14. by coordinate bench of this Tribunal, we direct the Ld.AO to restrict the addition to the amount of commission not recovered by the assessee from its AE. We therefore do not find any infirmity in the view taken by the Ld.CIT(A).
Adjustment towards Corporate Guarantee - Assessee in these years have advanced corporate guarantee in furtherance to its business of Infrastructure development in the field of Airports, Coal mining, Power projects abroad for which the assessee has set AEs abroad to facilitate in its expanding Infrastructure activities overseas - HELD THAT:- Primarily, we reject the argument of assessee that corporate guarantee is not an international transaction.
A corporate guarantee is a legal agreement between a borrower, lender, and guarantor, whereby a corporation takes responsibility for the debt repayment of the borrower provided it faced bankruptcy. A personal guarantee is a similar document to the corporate guarantee.
The considerations which applied for issuance of a Corporate guarantee are distinct and separate from that of bank guarantee and accordingly we are of the view that commission charged by the Ld.TPO under the facts of the case cannot be approved. In our view the comparison has not been drawn between like transactions but the comparisons are between guarantees issued by the commercial banks as against a Corporate Guarantee issued by holding company for the benefit of its AE, a subsidiary company.
The issue as to whether LIBOR is to be taken as the basis of interest benchmarking for foreign currency denominated loans or whether Indian PLR will be relevant for the same, is no longer res integra. See Tata Autocomp Systems Ltd [2015 (4) TMI 681 - BOMBAY HIGH COURT]
Thus we direct the Ld.TPO to compute the guarantee commission rate in accordance with the principles laid down in CIT Vs Tata Autocomp Systems Ltd. [2015 (4) TMI 681 - BOMBAY HIGH COURT] and CIT vs. Cotton Naturals (I)(P) Ltd. [2015 (3) TMI 1031 - DELHI HIGH COURT]
Further in case of Xchanging Solutions Ltd. vs. DCIT [2016 (10) TMI 1211 - ITAT BANGALORE] this Tribunal has considered the commission on guarantee fee at 0.5%. In view of the above, we direct the Ld.AO/TPO to recomputed the rate of commission attributable to the corporate guarantee in the present facts, in the light of the above.
Disallowance u/s. 14A under normal provisions - Suo moto addition by assessee - HELD THAT:- In view of the above judgment of the Hon’ble Madras High Court in the case of M/s.Marg Limited v. CIT (supra), it is clear that the disallowance u/s 14A of the I.T.Act cannot exceed the exempt income earned during the relevant assessment year irrespective whether larger amount was disallowed by the assessee u/s 14A of the I.T.Act while filing the return of income. Therefore, the AO is directed to restrict the disallowance u/s 14A
Respectfully following the view taken by Coordinate Bench in assessee’s sister concern case, we are of the view that the Ld.AO is directed to delete the suo moto disallowance made by assessee for A.Y. 2010-11 as the assessee filed revised computation during the original assessment proceedings.
In respect of A.Ys. 2012-13 and 2013-14, we direct the Ld.AO to restrict the disallowance to the extent of exempt income earned by assessee. In support of this view, we refer to the decision of Hon’ble Delhi High Court in case of Cheminvest Ltd. [2015 (9) TMI 238 - DELHI HIGH COURT] and the decision of Vireet Investments Pvt. Ltd. [2017 (6) TMI 1124 - ITAT DELHI]
Disallowance u/s. 14A for computing book profits u/s. 115JB - HELD THAT:- This issue stands squarely covered by the decision of Vireet Investments (P.) Ltd. [2017 (6) TMI 1124 - ITAT DELHI] where in it was held that “S.14A/Rule8D: (i) the computation under clause (f) of Explanation 1 to section 115JB(2) is to be made without resorting to the computation as contemplated u/s 14A read with Rule 8D of the Income tax Rules 1962, (ii) Only those investments to be considered for computing the average value of investment which yielded exempt income during the year”. Also see Sobha Developers Ltd. [2021 (1) TMI 378 - KARNATAKA HIGH COURT] We accordingly direct the Ld.AO to compute the book profits under section 115JB without resorting to the computation u/s. 14A r.w. Rule 8D.
Nature of expenses - Amortization of Upfront Fees and legal Fees paid - revenue expenditure or not? - AO disallowed the unamortized upfront fees and allowed the proportionate amortized upfront fees on the premise that, the service for which payment was made, would benefit the assessee over the entire tenure - CIT(A) upheld the disallowance made by the Ld.AO - HELD THAT:- We note that, the authorities below have not verified the facts in correct perspective. Admittedly, the assessee paid non-refundable fee for structuring, processing and advisory services to ICICI Bank in respect of NCD’s issued by assessee to ICICI. The assessee claimed the entire fee in the year of accrual in computation of Income, however amortized the amount in the books of account to the securities premium account, over the tenure of the debentures.
In present facts, the Ld.AO spread over the expenditure over the period of tenure. AO treated the same as deferred expenditure, which is an accounting concept and alien to the Act. The provisions of the Act recognizes only capital or revenue expenditure.
In a subsequent decision by Hon’ble Supreme Court in case of CIT vs. Secure Meters Ltd. [2009 (8) TMI 1135 - SC ORDER] it was held that an expenditure on loan was allowable as revenue expenditure. Similar is the view expressed in case of Taparia Tools [2015 (3) TMI 853 - SUPREME COURT] by Hon’ble Supreme Court. Thus we direct the Ld.AO to allow the claim of assessee in entirety in the year under consideration.
Levy of interest u/s. 234B - HELD THAT:- Interest u/s. 234B is to be computed from the date of intimation u/s. 143(1) and not from the 1st day of April of the relevant Assessment Year.
Addition of notional amount being difference in the revenue as per books of account and Form 26AS - AR submitted that, the Ld.AO proceeded to make the addition without considering the submissions of the assessee, with respect to the difference in income reported in Form 26AS and income as disclosed in the return - HELD THAT:- We remand this issue to the Ld.AO for de novo verification. The Ld.AO is directed to verify the claim in the light of the evidences including the additional evidence. The Ld.AO is also directed to verify if in the subsequent years it is accounted as and when the work was carried out by the assessee, it cannot be taxed in this assessment year and TDS credit to be given in this assessment year.
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2022 (5) TMI 1586 - ITAT KOLKATA
Unexplained cash credit u/s 68 - bogus share capital - HELD THAT:- Assessee has raised share capital of huge amount but has not filed any evidences to prove the identity and creditworthiness of the investors as well as the genuineness of the transactions and there is no materials before us to take a contrary view.
No reason to interfere with the decision of the CIT(A) as the share capital raised by the assessee remained unproved. Decided against assessee.
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2022 (5) TMI 1585 - ITAT RAIPUR
Setting-off the interest paid on the unsecured loan declined against the interest income earned on advancing of such amounts at interest to third parties - HELD THAT:- As per Section 57(iii) of the Act, any expenditure not being in the nature of a capital expenditure, laid out or expended wholly and exclusively for the purpose of making or earning income under the head 'income from other sources' is to be allowed as a deduction. As the interest-bearing unsecured loans were raised by the assessee with a purpose, intent and motive of earning interest income by advancing the same to third parties and, have actually been so utilized, therefore, the interest expenditure so borne by him could safely, or in fact, inescapably, be held to have been incurred wholly and exclusively for the purpose of earning of interest income. In the backdrop of our aforesaid deliberations, we are of a strong conviction that the deduction of interest expenditure as claimed by the assessee, and rightly so, was duly allowable as a deduction u/s. 57(iii) of the Act.
We, thus, in terms of our aforesaid observations not finding favor with the view taken by the lower authorities set-aside the order of the CIT(Appeals) and vacate the disallowance made by the AO. Grounds of appeal raised in appeal by the assessee are allowed.
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2022 (5) TMI 1584 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL PRINCIPAL BENCH
Maintainability of application u/s 95(1) of IBC - rejection of Application by Adjudicating Authority holding that the principal borrower being not under the CIRP or under liquidation.
Whether pendency of corporate insolvency resolution process or liquidation proceedings against the Principal Borrower/ Corporate Debtor is condition precedent for initiating CIRP against the Personal Guarantor?
HELD THAT:- In view of the law laid down by the Hon’ble Supreme Court in Shiv Kirpal Singh vs. V.V. Giri [1970 (9) TMI 127 - SUPREME COURT], it is clear that the provision of Section 60(2) in no manner can cut down the generality of Section 60(1). Section 60(2) has been engrafted to cover the specific situation and the provision is an addition to and is supplemental to provision of Section 60(1).
This Tribunal had occasion to consider this very question in State Bank of India Stressed Asset Management Branch [2022 (1) TMI 1294 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL PRINCIPAL BENCH, NEW DELHI]. In the above case also the Application under Section 95(1) filed by the Bank was rejected on the same very ground that no insolvency resolution process or the liquidation is pending against the Corporate Debtor before the NCLT and it was held that The Adjudicating Authority erred in holding that since no CIRP or Liquidation Proceeding of the Corporate Debtor are pending the application under Section 95(1) filed by the Appellant is not maintainable. The Application having been filed under Section 95(1) and the Adjudicating Authority for application under Section 95(1) as referred in Section 60(1) being the NCLT, the Application filed by the Appellant was fully maintainable and could not have been rejected only on the ground that no CIRP or Liquidation Proceeding of the Corporate Debtor are pending before the NCLT.
One of the submissions raised here is that the Application under Section 7 has been filed against the Principal Borrower, hence, the condition under Section 60(2) is also fulfilled. It is submitted that the mere fact that Application is not admitted does not lead to conclusion that Application is not pending - It is already held that there is no pre-condition of pendency of insolvency resolution process or liquidation against the Corporate Debtor for filing an Application under Section 60(1), there is no necessity to dwell on the submission any further.
The Adjudicating Authority committed error in rejecting the Application under Section 95(1) filed by the Appellant against the Personal Guarantor. The impugned orders passed by the Adjudicating Authority in all these Appeals are set aside and the Application under Section 95(1) filed by the Appellant before the Adjudicating Authority is revived to be proceeded with further in accordance with law.
Appeal allowed.
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2022 (5) TMI 1583 - ITAT PUNE
Ex-parte order passed by Tribunal - As assessee was confused to note down the date of next hearing in Virtual Mode and due to which the non-appearance on behalf of the assessee was caused before this Tribunal and submitted that assessee is ready to prosecute his appeal if this Tribunal pleased to recall the ex-parte order - HELD THAT:- Revenue did not report the objection in recalling the exparte order, therefore, considering the facts and circumstances of the case, in the interest of justice, we deem it proper to recall the order and direct the registry to fix the appeal in regular course. MA of assessee allowed.
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2022 (5) TMI 1582 - ANDHRA PRADESH HIGH COURT
Recovery of suit amount - suit debt is barred by limitation or not - part payment made under Ex. A-9 receipt can be termed as agreement under Section 25(3) of Indian Contract Act or not.
Whether the limitation to institute suit for recovery of amount, starts from the date of default or termination of chit is to be considered? - HELD THAT:- The Division bench of composite High Court in Jillelamudi Dhanalakshmi Vs. the Union Bank of India [1992 (2) TMI 384 - ANDHRA PRADESH HIGH COURT] while dealing with Article 37 of the Limitation Act held that the period of three years begins to run when the default is made unless the payee or obligee waives the benefit. It was further held that when the first installment fell due on 30-6-1976, the limitation began to run from 30-6-1976 and the suit filed beyond three years is held to be barred by limitation.
The case on hand indicates that the chit transaction commenced on 21-4-1997; defendant No. 1 became successful bidder on 4-7-1997; amount was paid to successful bidder on 15-9-1997 on which date defendants executed promissory note and agreement of guarantee and defendant No. 1 committed default in payment of installments from 4-4-1998. In this case after the default, the prized subscriber did not pay a single instalment and hence the limitation to recover the amount reckons from 4-4-1998. However, an amount of Rs. 5,000/- was paid on 29.04.2002 under Ex. A-9 i.e. after expiry of three years from the date of default - Since the appellants committed default in payment of installments from 4-4-1998, the suit is to be filed within three years from the date of default. However, the plaintiff presented the suit on 29-4-2005 seeking recovery of amount beyond the period of three years prescribed under Article 37 of the Limitation Act.
It is settled principle of law that when the pleadings of both parties are available and each party knows about the case of other and adduces evidence in support of the same, non-framing of an issue, is of no consequence. The very purpose of framing the issue is to know as to what is the lis involved in the suit. The parties went to trial knowing fully well what they were required to prove.
Thus, the position of law is well settled that where parties adduce evidence in respect of a matter for which an issue has not been framed and both sides are well aware of the dispute which relates to the issue, the defect of non-framing of the issue is cured. There will be no inherent lack of jurisdiction in the Court to go into that question and decide that aspect of the matter.
It is clear from perusal of Ex A-9 that it doesn't contain any specific promise as mandated under Section 25(3) of Contract Act. It is only a simple receipt evidencing making of payment of Rs. 5,000/-. There is no separate agreement between the parties in connection with payment of balance amount. Thus, even the part payment made under Ex A-9 without any specific agreement may not be useful to the plaintiff in saving limitation - this Court came to conclusion that the suit filed for recovery of amount is barred by limitation and hence is liable to be dismissed.
The appeal filed by defendants in the suit deserves to be allowed by setting aside the judgment and decree passed by the Lower Court - Appeal allowed.
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2022 (5) TMI 1581 - CENTRAL ADMINISTRATIVE TRIBUNAL PRINCIPAL BENCH AT NEW DELHI
Seeking extension of suspension order - Smuggling - fraudulent export of Duty drawback - export of Red Sanders - HELD THAT:- The Department in agreement with CVC advise dated 28.12.2021 is in advance stage for sanction of prosecution under Prevention of Corruption Act and initiation of departmental proceedings against the applicant in fraudulent export of Duty drawback and export of Red Sanders cases. Further, departmental proceedings are contemplated in consultation with the CVC in case of systematic smuggling of restricted/prohibited goods through Cargo Shed of NSCBI, Airport, Kolkata booked by SIIB, Air Cargo Complex, Kolkata, Air Cargo Complex, NSCBI Airport, Kolkata during 2017 in consultation with CVC vide O.M. dated 01/05.10.2020. Considering the involvement of the applicant in smuggling activity, penalty of Rs. 10,00,000 under Section 112 (a) and 112 (b) and also Rs. 10,00,000 under Section 114AA of Customs Act, 1962 was imposed on the applicant. Sanction of Competent Authority for prosecuting the applicant under Customs Act, 1962 has been conveyed by Commissioner (Inv-Cus) to Commissioner of Customs(Prev.), Kolkata vide letter dated 07.01.2021.
It is evident that the applicant is involved in various cases, including CBI and Vigilance. On completion of investigations, major penalty charge sheets are contemplated, not in one but in many cases. It brings us to the moot point that has been raised in this O.A., which is non-issuance of a charge sheet and continued suspension. Basically whether suspension of the applicant can be continued beyond 90 days, if no charge sheet has been issued.
This subject matter has been dealt with by the Hon'ble Apex Court and also by the Hon'ble High Court in different cases. The Hon'ble Apex Court in Ajay Kumar Choudhary vs. Union of India through its Secretary & Anr. [2015 (6) TMI 592 - SUPREME COURT] has been primarily relied upon where it was held that Previous Constitution Benches have been reluctant to quash proceedings on the grounds of delay, and to set time limits to their duration. However, the imposition of a limit on the period of suspension has not been discussed in prior case law, and would not be contrary to the interests of justice. Furthermore, the direction of the Central Vigilance Commission that pending a criminal investigation departmental proceedings are to be held in abeyance stands superseded in view of the stand adopted by us.
The judgments clearly hold that suspension can be continued depending upon gravity of offences. In the present case, the applicant is under investigation in various cases by the CBI and Vigilance organisation. His prosecution and also major penalty action is contemplated against him. The charges for which he is under investigation are of very serious nature and, therefore, his continued suspension does not call for any interference by this Tribunal.
In view of completion of various investigations and recommendations of major penalty action, already available with the respondents, the respondents should endeavour to take further necessary action for issuance of charge sheet, if so decided, and consider all these aspects during the next Suspension Review Committee meeting - Application dismissed.
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2022 (5) TMI 1580 - DELHI HIGH COURT
Grant of Anticipatory Bail challenged - criminal conspiracy to cheat the petitioner/complainant of valuable property - flight risk or not - HELD THAT:- As has been held by the Supreme Court in Hazari Lal Das [2009 (9) TMI 929 - SUPREME COURT], following the judgment of the Supreme Court in Dolat Ram Vs. State of Haryana [1994 (11) TMI 424 - SUPREME COURT], once bail is granted, very cogent and overwhelming circumstances are necessary for an order directing its cancellation. The one seeking cancellation of the bail must show an interference by the accused or attempt to so interfere, with the due course of administration of justice or an evasion or attempt to evade the due course of justice or an abuse of the concession granted to the accused in any manner.
It is clear, in the present case, the petitioner/complainant has not been able to establish any of these factors, even on a prima facie view of the matter. There is no material placed on the record to show that the respondents/accused persons are a flight risk. No supervening circumstances have been brought to the notice that would establish that it would be no longer conducive to a fair trial to allow the accused to retain their freedom.
Though the arguments were advanced on behalf of the respondents to the effect that no offence was made out, but it is not considered apposite to discuss that aspect in the present petition, as those considerations would be more relevant, while determining the question as to what charge is to be framed against the respondents/accused. For the present, the question is whether, grounds exist for cancelling the bail already granted to the respondents/accused.
Petition dismissed.
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2022 (5) TMI 1579 - ITAT MUMBAI
Employees’ contribution to Provident Fund and ESI - sum not remitted within the due date prescribed u/s. 36(1)(va) but were remitted before the due date of filing of income tax returns u/s. 139(1) - Adjustment u/s. 143(1)(a) - HELD THAT:- We find that this issue is no longer res integra in view of the recent decision of the Co-ordinate Bench of this Tribunal in the case of Kalpesh Synthetics Pvt. Ltd [2022 (5) TMI 461 - ITAT MUMBAI] held that
When the due date under Explanation to Section 36(1)(va) is judicially held to be not decisive for determining the disallowance in the computation of total income, there is no good reason to proceed on the basis that the payments having been made after this due date is “indicative” of the disallowance of expenditure in question. While preparing the tax audit report, the auditor is expected to report the information as per the provisions of the Act, and the tax auditor has done that, but that information ceases to be relevant because, in terms of the law laid down by Hon’ble Courts, which binds all of us as much as the enacted legislation does, the said disallowance does not come into play when the payment is made well before the due date of filing the income tax return under section 139(1). Viewed thus also, the impugned adjustment is vitiated in law, and we must delete the same for this short reason as well.
In view of the detailed discussions above, we are of the considered view that the impugned adjustment in the course of processing of return under section 143(1) is vitiated in law, and we delete the same.
The amendment brought in Section 36(1)(va) of the Act is to be construed only as prospective in operation and cannot be applicable for the year under consideration.
We find that the law prevailing prior to A.Y. 2021-22 would rule the field and the case laws rendered by various High Courts would rule the field. Prior to the amendment, the Hon’ble Jurisdictional High Court in the case of CIT vs. Ghatge Patil Transport Ltd.[2014 (10) TMI 402 - BOMBAY HIGH COURT] had held that employees contribution to PF & ESI if remitted within the due date prescribed u/s. 139(1) of the Act for filing the income tax returns, would be allowed as deduction u/s.43B - Assessee Appeal allowed.
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2022 (5) TMI 1578 - SUPREME COURT
Refusal of registration - Whether the recourse by the second Respondent to Section 72 of the Registration Act, against the order of the Sub-Registrar refusing registration on the basis of the Appellant's denial of execution, would deprive them of any remedy whatsoever? - Appellant's admission of her signatures and thumb impressions/fingerprints on the sale deed also amounts to an admission of its "execution" or not.
HELD THAT:- The "execution" of a document does not stand admitted merely because a person admits to having signed the document. Such an interpretation accounts for circumstances where an individual signs a blank paper and it is later converted into a different document, or when an individual is made to sign a document without fully understanding its contents. Adopting a contrary interpretation would unfairly put the burden upon the person denying execution to challenge the registration before a civil court or a writ court, since registration will have to be allowed once the signature has been admitted.
The Registration Act exists so that information about documents can be put into the public domain, where it can be accessed by anyone in order to prevent forgeries and fraud, and so that individuals can be aware of the status of properties. If the interpretation conflating signing with execution is adopted, it would ensure that the Sub-Registrars/Registrars will continuously end up registering documents whose validity will inevitably be then disputed in a civil suit or a writ petition. While the suit or writ proceedings continue, the document would remain on the public records as a registered instrument, which has the potential to cause more disruption. Hence, such an interpretation should not be adopted by this Court.
The plea of the Appellant, that the purported sale deed though signed by her was procured by fraud and undue influence, was a matter which raised a serious substantive dispute. In support of her contentions, the Appellant has also adduced before us the inspection report by the Sub-Registrar and the Naib Tahsildar. However, we are inclined to hold that we cannot decide on the merits of the dispute at this stage, since the Registrar clearly exceeded his jurisdiction by adjudicating on the issue of fraud and undue influence.
The Registrar purported to exercise the powers conferred Under Section 74 and arrived at a finding that the sale deed had been duly signed by the Appellant and was therefore liable to be registered. However, the objections of the Appellant raised serious issues of a triable nature which could only have been addressed before and adjudicated upon by a court of competent civil jurisdiction - As regards the subject matter of the sale deed, the second Respondent has instituted a suit for possession before the Civil Judge, Senior Division Fast Track Court Suit No 264 of 2016, where certain proceedings are pending. In this view of the matter, we are clearly of the opinion that the Registrar in the present case acted contrary to law by directing the sale deed to be registered.
The Single Judge of the Allahabad High Court has observed that registration does not depend upon the consent of the executant but on the Registrar's finding that the executant had actually signed the document. The High Court held that having found in the course of the enquiry that the sale deed was duly prepared by a scribe, that the attesting witness had stated that the sale deed was signed by the Appellant and she also placed her fingerprints in their presence, it was open to the Registrar to direct registration in spite of a denial of its execution by the Appellant - Appeal allowed.
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2022 (5) TMI 1577 - DELHI HIGH COURT
Invocation of power of the Court under Section 482 of the Cr.P.C. - failing to secure the Petitioner's right to an adequate representation, under Article 21 of the Indian Constitution, read with Delhi Prison Rules, 2018 - HELD THAT:- It is well established principle of law that the High Court has inherent power to act ex debito justitiae - to do real and substantial justice for the administration of which alone it exists or to prevent the abuse of process of the Court.
A seven-Judge Bench in the case of P. RAMACHANDRA RAO VERSUS STATE OF KARNATAKA [2002 (4) TMI 962 - SUPREME COURT] laid down the principles for exercise of the power under Section 482 Cr.P.C. in a case where the Court was convinced that such exercise was necessary in order to prevent abuse of the process of any Court or to secure the ends of justice. The Hon'ble Supreme Court observed The power is wide and, if judiciously and consciously exercised, can take care of almost all the situations where interference by the High Court becomes necessary on account of delay in proceedings or for any other reason amounting to oppression or harassment in any trial, inquiry or proceedings.
The position of law that is crystallised, in light of the aforementioned judgments, is that jurisdiction under Section 482 should be exercised sparingly, with circumspection and in rarest of the rare cases. Hence, what is only required to be seen is whether there has been an abuse of process or that the interest of justice requires the exercise of the jurisdiction.
Having delineated the scope of the powers of the Court in exercise of its jurisdiction under Section 482, and applying the same to the case at hand, it is evident that there is no such relief that can be granted as is being prayed for. There is no reason to interfere with the impugned order passed by the Learned ASJ - the extraordinary writ jurisdiction cannot be exercised to give special treatment to the petitioner by facilitating physical meetings for him with his counsel. Inherent powers of the Court are meant to be exercised to prevent the abuse of the process of any Court, however the petitioner under the garb of the liberty to approach the Court under the said provision is attempting to commit gross misuse of process.
The provision of the Code that is meant to secure the ends of justice cannot be otherwise subverted to circumvent the scheme of the Code. In light of the aforesaid, this Court does not find any cogent reason or any substantial ground to invoke its extraordinary jurisdiction to grant the relief that is being sought by the petitioner.
Petition dismissed.
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2022 (5) TMI 1576 - GUJARAT HIGH COURT
Grant of refund of excess tax alongwith interest - inter-state sales against the statutory declaration forms attracted concessional rate of tax under the CST Act - Input Tax Credit of the writ applicants exceeded output tax liability - HELD THAT:- It is not in dispute that after the filing of the annual return, the time limit for assessment and reassessment under the VAT Act expired and no assessment or re-assessment order was passed by the authority.
The issue is squarely covered by two decisions of this High Court inMALHOTRA GRAMALHOTRA GRAPHICS THRO' SANJAY MALHOTRA VERSUS STATE OF GUJARAT & 1PHICS THRO' SANJAY MALHOTRA VERSUS STATE OF GUJARAT & 1 [2012 (3) TMI 704 - GUJARAT HIGH COURT] and TORRENT POWER LTD. AND 1 OTHER (S) VERSUS STATE OF GUJARAT AND 1 OTHER (S) [2019 (6) TMI 893 - GUJARAT HIGH COURT]where it was held that Since the amount is deposited under protest by the petitioners and no order of assessment, reassessment or revision is passed till date, the amount retained by the authority is not backed by any authority of law in the light of Article 265 of the Constitution of India and, therefore, the respondents have no authority to retain the same.
This writ application is allowed with a direction to the respondents to grant the refund of Rs. 2,96,622/- due as per the self-assessment return under the VAT Act for the year 2013-14 along with the statutory interest payable on such refund within a period of six weeks from the date of receipt of the writ of this order.
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2022 (5) TMI 1575 - BOMBAY HIGH COURT
Validity of reopening of assessment u/s 147 - excess premium charged by assessee - notice issued after the expiry of four years - assessee has followed Discounted Cash Flow method (DCF) and valued the shares at Rs. 1,015/- per share as per valuation report relied upon to justify the share premium. AO feels that the assessee could have charged premium of only Rs. 249.70 per share - HELD THAT:- The reason for reopening is nothing but a change of opinion. Admittedly scrutiny assessment u/s 143(3) was completed on 26th November 2016 after accepting loss shown in the returns.
During the assessment proceedings, by a notice issued u/s 142(1) petitioner was called upon by respondent no. 1 to provide valuation report, bank statements and ITR of M/s. Kesar Motels Pvt. Ltd. for share premium received. This was provided by petitioner vide its Chartered Accountant’s letter dated 8th November 2016. Petitioner had also provided copy of ITR, valuation certificate and other details. After considering all these points, an assessment order dated 29th November 2016 came to be passed.
This is a case of reopening after expiry of four years from the end of the relevant assessment year. Respondent had to show that there was failure to truly and fully disclose material facts. Not only petitioner has disclosed but respondent has also raised queries during the course of assessment proceedings and has passed an assessment order u/s 143(3) of the Act.
On the issue of the assessment order being silent, it is settled law that once a query is raised during the assessment proceedings and the assessee has replied to it, it follows that the query raised was a subject of consideration of the Assessing Officer while completing the assessment. It is not necessary that an assessment order should contain reference and/or discussion to disclose its satisfaction in respect of the query raised [Aroni Commercials Ltd. V/s. Deputy Commissioner of Income Tax 2 (1) [2014 (2) TMI 659 - BOMBAY HIGH COURT] - Decided in favour of assessee.
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2022 (5) TMI 1574 - ITAT PANAJI
Disallowance of administrative expenses u/s 14A r.w Rule 8D(2)(iii) - HELD THAT:- AO had failed to record his dissatisfaction as regards the claim of the assessee that no part of the expenditure claimed as deduction could be attributed towards earning of exempt dividend income, therefore, he had wrongly assumed jurisdiction u/s. 14A of the Act, as a result whereof the disallowance determined by him by triggering the mechanism contemplated in Rule 8D(2)(iii) cannot be sustained and is liable to be vacated. As we have vacated the disallowance made by the A.O u/s. 14A(2)(iii) for want of valid jurisdiction on his part, therefore, we refrain from adverting to the other contentions that have been advanced by the Ld. AR qua sustainability of the said disallowance on merits which are left open. Ground of appeal No.2 raised by the assessee is allowed in terms of our aforesaid observations.
Disallowance of deduction of contributions to temple/panchayat - as contributions made by the assessee to the temple/panchayat were not eligible for deduction u/s. 80G, A.O disallowed the assessee’s claim for deduction of the aforesaid amount in question - HELD THAT:- Aforesaid contributions/expenditure which are neither in the nature of personal expenditure or capital expenditure and have been incurred by the assessee company in order to facilitate running of its business of mining smoothly, i.e., without any disturbance from the people in the surrounding villages thus, being in the nature of an expenditure incurred by the assessee wholly and exclusively for the purpose of its business was allowable as a deduction u/s. 37(1) of the Act - no infirmity in the view taken by the CIT(Appeals) who had vacated the aforesaid disallowance.
Addition u/s 41(1) - cessation of liabilities - Assessee had failed to furnish confirmations in respect of four creditors - HELD THAT:- Now when it is the claim of the assessee that the impugned liabilities had ceased to exist in the aforementioned succeeding years, then, in case the A.O was to hold otherwise, he was obligated to substantiate on the basis of irrefutable material that the said outstanding liabilities had in fact ceased to exist during the year under consideration itself, i.e., A.Y.2009-10. - Decided against revenue.
A.O could not have summarily concluded that the cessation of the aforementioned outstanding liability had occasioned during the year under consideration, i.e., AY 2009-10. We, thus, in terms of our aforesaid observations, finding no infirmity in the view taken by the CIT(Appeals) who had rightly vacated the addition of made by the A.O u/s. 41(1) uphold the same. - Decided against revenue.
Addition u/s. 28(iv) - assessee had received advances/deposits in the preceding years from 6 parties, i.e., for providing handling services in connection with its business which stood reflected in its ‘balance sheet’ on 31.03.2009 - HELD THAT:- We find substantial force in the claim of the Ld. AR that the invoking of provisions of section 28(iv) of the Act pre-supposes any benefit or perquisite whether convertible into money or not, arising from business or the exercise of a profession.
As observed in the case of Commissioner Vs. Mahindra & Mahindra Ltd. [2018 (5) TMI 358 - SUPREME COURT] for invoking the provisions of section 28(iv) of the Act, benefit received has to be in some form other than in shape of money. Observing, that as the waiver of loan for acquiring a capital asset in the case before them represented cash/money, the Hon’ble Apex Court in its aforesaid order had concluded that the provisions of section 28(iv) of the Act would not be applicable.
As stated by the AR, and rightly so, as cessation of a capital receipt of an amount by the assessee, i.e., deposits/advances for providing handling services that were received by the assessee in the normal course of its business in the preceding years, would undisputedly represent cash/money and is not in the nature of benefit or perquisite other than any shape of money, therefore, the provisions of section 28(iv) of the Act would not get triggered.
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2022 (5) TMI 1573 - ITAT JABALPUR
Rectification of mistake - Maintainability of the Revenue‘s appeal u/s. 268A - Tribunal dismissed the Revenue‘s captioned appeals as not maintainable u/s. 268A inasmuch as the tax effect is below Rs. 50 lakhs - Revenue‘s case is that there has been an omission on the part of the Tribunal while considering its‘ instant appeals to have regard to the fact, expressly brought forth and conveyed to the Tribunal, that the same were covered under exceptional Cl.10 (c) of the Board Instruction 03/2018, dated 11/07/2018 and, that, therefore, the same stand wrongly dismissed as being in violation of the said Board Instruction (BI) and, thus, not maintainable - whether the Tribunal holding, per the impugned order, that there is nothing on record to prove the Revenue‘s contention, is correct or not? - HELD THAT:- A perusal of the appeal folder/s reveals a clear mention of the exceptional clause under which the instant appeal/s stands preferred, filed along with the appeal papers, as indeed the communications between the ld. Departmental Representative and the field officer confirming this position, again duly furnished to the Tribunal prior to the date of hearing of the appeal/s. There being no reference to these documents, admittedly relevant, in the impugned order, reproduced in it‘s operative part hereinbefore, there has clearly been an omission on the part of the Tribunal in not noticing the same, much less have regard thereto, incumbent on it under law.
The assessee‘s principal objection concerns the disregarding of the same by the Tribunal inasmuch as the same, having not been supplied to the assessee, could not form part of it‘s record. We, for the several reasons afore-stated, find the said argument misconceived. The argument presumes the non-consideration of the said material by the Tribunal in the first instance for this reason, even as there is no whisper of the same in it‘s order. That is, is wholly presumptuous.
It further presumes that the Tribunal, though conscious of the said material, yet chose not to direct either the Revenue or it‘s Registry to supply a copy thereof to the assessee, as in that case, forming part of it‘s record, it would be obliged to take cognizance thereof. That is, acts in a partisan manner. Rather, where so, i.e., the material was not admitted by the Tribunal on this ground, the same ought to form part of it‘s order, which only would qualify the same as a judicial order inasmuch as the same has to be, by definition, a speaking order.
On merits, to even suggest that the AM u/s. 253(2), which forms part of the appeal papers, is not a part of the Tribunal’s record, is, to our mind, perverse. There is no requirement in law for the Revenue to have filed the same with the assessee – who could though seek a copy of the same, nor any prescribed manner for communicating the same. Rather, inasmuch as the same concerns the legal competence for filing an appeal, mention thereof in and as part of the authorization memo u/s. 253(2), authorising the filing of an appeal with the Tribunal, which forms part of the appeal memo and, thus, part of the Tribunal‘s record, it‘s mention therein is most appropriate
Ignoring the attendant circumstance, besides being in clear violation of the clear mandate of law (s. 268A(4)), itself constituting a mistake, liable for rectification, which extends to both mistakes of fact and law, could only be at the peril of causing a serious prejudice to the appellant, negating it‘s right of appeal. It is trite law that no Court or Tribunal could by it‘s action or, as the case may be, non-action, cause prejudice to any of the party before it, which, where so, is to be regarded as mistaken, liable for rectification u/s. 254(2), even as explained in Honda Siel Power Products Ltd. [2007 (11) TMI 8 - SUPREME COURT]
For us, it is therefore no more than a simple case a bona fide omission by the Tribunal in, while adjudicating the matter, failing to take note of the compelling documents on it‘s record in support of the contention of the ld. DR – nothing more, and nothing less, and which therefore warrants being addressed by taking due notice of the said documents, all forming part of the appeal papers themselves (inasmuch as the communication between the Departmental officers is only toward and in substantiation of the eligibility note at para 2 of the AM, which is to accompany an appeal by the Revenue. The argument advanced – which has been considered in all it‘s different facets, serving, to our mind, only to obfuscate the issue.
The second argument, i.e., of an order, though mistaken, yet cannot be recalled inasmuch as scope of the instant proceedings is limited to making to amendments in respect of mistake/s apparent from record, the same glosses over the fact that the impugned order is not an order on merits, but an in limine dismissal of the appeal/s under reference for want of competence on technical, albeit mandatory, grounds. That a judgment is to be read as a whole, and it is the principle of law enunciated, it‘s ratio decidendi, that is binding, is trite law. The said argument is wholly misplaced and, if anything, itself mistaken.
We cannot help observing the assessee‘s conduct in the matter. The Bench had in the instant proceedings on an earlier occasion, in response to Sh. Purohit‘s contention as to the assessee having not been supplied a copy of authorization memo by the Revenue, directed for the same to be provided to the assessee inasmuch as the same were relevant toward the maintainability of the Revenue‘s appeal u/s. 268A, as well as copy of the Revenue‘s Audit Objection, also called for by the Bench during hearing. Further instructions were also passed for the assessee to make arrangements for collecting copy thereof from the Registry. This is borne out by order sheet entries dated 11/9/2020, 18/9/2020 and 25/9/2020. The assessee, however, did not take the copy thereof. As it transpires, this was as that would defeat the assessee‘s case. We have, however, at our end, confirmed that the Revenue Audit Objections are in respect of the grounds assumed by the Revenue per it‘s instant appeals, validating it‘s assertions, which we have done for our satisfaction as indeed in discharge of the obligation cast on the Tribunal u/s. 268A(4).
We, thus reject the assessee‘s contentions, and admit and decide the instant MAs by it in favour of the Revenue inasmuch as its‘ instant appeals were wrongly dismissed u/s. 268A(1) r/w s. 268A(4) of the Act.
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2022 (5) TMI 1572 - ITAT AHMEDABAD
Penalty u/s 271E - contravention of the provision of Section 269T - repayment of loan/deposits through account payee cheque or account payee drafts - whether assessment proceedings are necessary to levy penalty u/s 271E? - HELD THAT:- As relying on SHRI MANOHAR LAL THAKRAL [2011 (1) TMI 538 - PUNJAB AND HARYANA HIGH COURT] the impugned penalty under Section 271E is not permissible in the absence of regular assessment framed against the assessee by the Revenue. Hence, the same is not found to be sustainable in the eye of law and, thus, quashed. The appeal preferred by the assessee is, therefore, allowed.
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2022 (5) TMI 1571 - ITAT RAIPUR
Penalty u/s 271(1)(c) - non specification of clear charge - HELD THAT:- AO is under obligation to specify the appropriate limb of clause c of section 271(1)(c) of the Act at the time of initiation as well as at the time of levy of penalty notice.
In this case it has been drawn our attention that while recording the satisfaction in the assessment order as well as while issuing the notice at two occasion failed to specify the charge under which the assessee is liable for penalty and therefore we set aside the order of CIT(A) and direct the Assessing Officer to delete the levy of penalty imposed upon the assessee, relying on the various decision cited by the co-ordinate bench while rendering the decision in the case of Shri Swapnil Kumar Jain [2022 (4) TMI 178 - ITAT RAIPUR] - In the result the appeal of the assessee is allowed on legal issue.
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2022 (5) TMI 1570 - ITAT DELHI
Disallowance of deduction u/s 80IC - interest income earned on fixed deposits - profits and gains derived from manufacture/production of any article or things - HELD THAT:- In case of Liberty India Ltd.[2009 (8) TMI 63 - SUPREME COURT] while reiterating identical view has observed that the income qualifying for deduction must have a first degree relationship with the eligible business. In the facts of the present appeal, admittedly, the interest income which the assessee has claimed as deduction u/s 80IC was earned on fixed deposits kept in bank for the purpose of securing the entry tax which was under dispute. However, it cannot be said that such interest income has any direct nexus with profits and gains derived from manufacture/production of article or things.
In our view, the dispute relating to entry tax would not have any impact on the manufacturing activity of the assessee, since in the worst case the assessee would have brought the raw materials/goods on payment of entry tax. Thus, payment or nonpayment of entry tax would not have stalled the manufacturing activity of the assessee.
Thus it cannot be said that the interest income earned by the assessee is part of profits and gains “derived from” manufacture or production of article or things. Therefore, in our humble opinion, the interest income earned by the assessee would not qualify for deduction u/s 80IC of the Act.
Disallowance made u/s 14A r.w.r. 8D. - HELD THAT:- Insofar as assessment year 2013-14 as before us, the assessee has submitted that it had sufficient interest refund available to take care of the investment made. In this regard, we must observe, neither before the departmental authorities nor before us the assessee has furnished any working computing the disallowance u/s 14A r.w.r. 8D. Therefore, in absence of any such computation/working by the assessee, we are unable to record any conclusive finding regarding assessee’s claim.
Necessity of recording satisfaction - For assessment year 2014-15 submission of learned counsel for the assessee that the AO has not recorded any valid satisfaction is unsustainable. Recording of satisfaction by the AO regarding correctness of assessee’s claim would arise when the assessee itself has computed disallowance u/s 14A r.w.r. 8D on its own in the return of income furnished to the department. When the assessee has not made any such claim in the return of income, AO cannot record satisfaction in vacuum.
Having held so, it is necessary to observe, before us, assessee has submitted that the assessee had sufficient interest free refund with it to take care of the investment. Since, the aforesaid claim of the assessee has not been examined factually by the departmental authorities with reference to availability of funds in the books of account; we deem it appropriate to restore this issue to the AO for factual verification of assessee’s claim.
Disallowance of administrative expenses under Rule 8D(2)(iii), AO has to compute the disallowance by considering only those investments, which have yielded exempt during the year. With the aforesaid observations, the issue is restored back to the Assessing Officer for fresh adjudication.
Deduction u/s 80G - deduction was disallowed due to non-furnishing of supporting evidence - HELD THAT:- Commissioner (Appeals) has observed that the assessee not only failed to furnish the receipt issued by the donee but also could not furnish the eligibility certificate of the donee. In our view, for claiming deduction under section 80G assessee is required to furnish the supporting evidence, if called upon to do so by the AO. In absence of such supporting evidence, assessee’s claim of deduction could not have been allowed.
To enable the assessee to furnish the supporting evidences to prove the claim of deduction u/s 80G we restore this issue to the AO for fresh adjudication after due opportunity of being heard to the assessee.
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2022 (5) TMI 1569 - SUPREME COURT
Refusal to condone the delay in filing the written statement - computation of time limitation - HELD THAT:- In that view of the matter, the period from 15.03.2020 till 28.02.2022 shall have to be excluded for the purposes of limitation as may be prescribed under any General or SPECIAL LAWS in respect of all judicial or quasi-judicial proceedings. The Commercial Courts Act, 2015 being a Special Law, the said order shall also be applicable with respect to the limitation prescribed under the Commercial Courts Act, 2015 also.
In view of the above and for the reasons stated above and more particularly when the 120 days period expired in the present case on 09.05.2020 which was during the aforesaid period as prescribed by this Court in the aforesaid order, the High Court ought to have excluded the aforesaid period for the purpose of filing the written statement and ought to have permitted to take the written statement on record. The impugned judgment and order passed by the High Court refusing to condone the delay and take on record the written statement is hereby quashed and set aside.
The Appeal is accordingly allowed.
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