TMI Tax Updates - e-Newsletter
October 11, 2019
Case Laws in this Newsletter:
GST
Income Tax
Customs
Insolvency & Bankruptcy
Service Tax
Central Excise
TMI SMS
Highlights / Catch Notes
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GST:
Refund of input tax credit (ITC) - Export - since the Petitioner is held to be entitled for refund of ITC and as such no prejudice will be caused to them, if they would first pay GST on the services provided to DFSs by MIAL and take ITC of the entire tax amount, and thereafter claim refund of the same by following the procedure contained in Rule-89.
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GST:
Levy of GST - Place and time of supply - IGST - validity of SCN - sale of duty free goods from the duty free shops (DFS) - The customs duty and IGST is leviable only on removal of warehoused goods from the customs area, which happens when the arriving passengers leave the custom area. Since, the goods sold by DFS to arriving passengers do not leave the customs area, DFS is neither liable to pay customs duty, nor IGST.
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Income Tax:
Addition u/s 68/69A - As per the scheme of presumptive taxation provided u/s 44AF the estimated business income from aggregate cash deposits / turnover works by applying 5% thereon. The estimated income from the cash deposits in the bank is thus requires to be restricted to the aforesaid amount.
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Income Tax:
Long term capital - "transfer" within the meaning of Sec. 2 (47) - implementation of JDA - Decision in the case of ITAT [2018 (10) TMI 1345 - ITAT BANGALORE] followed, and the decision of HC [2012 (6) TMI 405 - KARNATAKA HIGH COURT] distinguished.
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Income Tax:
Disallowance of Salary paid to the partner - increase in the salary - Support by the terms of partnership deed - claim of the assessee that in the subsequent years the increased salary had been accepted was not rebutted - Claim allowed.
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Income Tax:
Capital gain computation - Addition u/s 50C - Increase in Circle Rate between the date of agreement and actual date of registration - AO is directed to adopt full value consideration as DLC rate on the date of agreement and if sale consideration shown in the sale deed is more than DLC Rate of the property then no addition u/s 50C.
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Customs:
Demand pending appeal - Seizure of vessel - FC Maria Laura - evasion of customs duty - it will not be appropriate to require Fomento to maintain the bank guarantee as a precondition for Customs not initiating coercive proceedings to enforce demand.
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Customs:
Valuation of imported goods - inclusion of the “ship demurrage charges” incurred by the appellant in the assessable value - Since the HC has declared proviso to Rule 10(2) of the Valuation Rules to be ultra virus, demand set aside.
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Customs:
Valuation of imported goods - Brass Valve & Zinc Valves - the adjudicating authority has not recorded a single sentence of finding on contemporaneous import detail given by the appellant and thus the rejection of value was not supported.
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Customs:
Imposition of penalty u/s 112(a) of CA on Customs Broker / CB - various irregularities committed by the main importers - there should be a clear evidence to come to the conclusion that the appellants by their specific act or omission or any act abetted the illegal importation of offending goods.
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Service Tax:
GTA Services - The foodstuff is a clear, unambiguous word and there is nothing to indicate that the same would apply to transportation of the raw material etc. which have to be further converted into a final edible product - Benefit of exemption cannot be denied.
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Service Tax:
Business Auxiliary Service - amount collected from the customers under the new scheme called “Passport Bonus Card Scheme” on behalf of the manufacturer - When there is no inflow for the appellants, there may not be any allegation of such activity to come within the ambit of the definition of BAS
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Central Excise:
CENVAT Credit - input services - ‘ventilation stopping area and isolation stopping area’ cannot be called as civil structure, accordingly, CENVAT Credit availed by the Appellant on the input/input services cannot be denied.
Articles
Notifications
Customs-
74/2019 - dated
9-10-2019
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Cus (NT)
Courier Imports and Exports (Electronic Declaration and Processing) Second Amendment Regulations, 2019
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73/2019 - dated
9-10-2019
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Cus (NT)
Courier Imports and Exports (Clearance) Second Amendment Regulations, 2019
GST-
49/2019 - dated
9-10-2019
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CGST
Central Goods and Services Tax (Sixth Amendment) Rules, 2019
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48/2019 - dated
9-10-2019
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CGST
Seeks to amend notification No. 41/2019 – Central Tax, dated the 31st August, 2019.
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47/2019 - dated
9-10-2019
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CGST
Seeks to make filing of annual return under section 44 (1) of CGST Act for F.Y. 2017-18 and 2018-19 optional for small taxpayers whose aggregate turnover is less than ₹ 2 crores and who have not filed the said return before the due date.
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46/2019 - dated
9-10-2019
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CGST
Seeks to prescribe the due date for furnishing of return in FORM GSTR-1 for registered persons having aggregate turnover more than 1.5 crore rupees for the months of October, 2019 to March, 2020
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45/2019 - dated
9-10-2019
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CGST
Seeks to prescribe the due date for furnishing FORM GSTR-1 for registered persons having aggregate turnover of up to 1.5 crore rupees for the quarters from October, 2019 to March, 2020.
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44/2019 - dated
9-10-2019
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CGST
Seeks to prescribe the due date for furnishing of return in FORM GSTR-3B for the months of October, 2019 to March, 2020
GST - States-
43/2019-State Tax - dated
3-10-2019
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Delhi SGST
Amendment in Notification No. 14/2019-State Tax , dated 12.09.2019
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14/2019-State Tax (Rate) - dated
3-10-2019
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Delhi SGST
Seeks to amend Notification No. 1/2017-StateTax (Rate), dated the 30th June, 2017
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20/2019-State Tax (Rate) - dated
30-9-2019
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West Bengal SGST
Seeks to amend notification No 1135-F.T. dated 28.6.2017 regarding taxable services
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18/2019-State Tax (Rate) - dated
30-9-2019
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West Bengal SGST
Seeks to amend notification No 377-FT dated 7.3.2019 regarding new composition of 6% to exclude aerated water from such composition
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17/2019-State Tax (Rate) - dated
30-9-2019
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West Bengal SGST
Seeks to amend notification No 1899-FT dated 31.12.2018 to exempt State tax on supply of silver and platinum by nominated agencies to exporters of silver/platinum jewellery
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16/2019-State Tax (Rate) - dated
30-9-2019
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West Bengal SGST
Seeks to amend notification No 1127-F.T. dated 28.6.2017 to notify that Petroleum operations or coal bed methane operations undertaken under specified contracts under the Hydrocarbon Exploration Licensing Policy (HELP) or Open Acreage Licensing Policy (OALP) will be taxable @ 2.5%
Money Laundering-
G.S.R. 762(E) - dated
7-10-2019
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PMLA
Central Government, constitutes an Inter-ministerial Co-ordination Committee (IMCC)
Circulars / Instructions / Orders
News
Case Laws:
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GST
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2019 (10) TMI 360
Levy of GST - Place and time of supply - IGST - validity of SCN - sale of duty free goods from the duty free shops (DFS) at the departure area of airport - Refund of input tax credit - whether the DFSs at MIAL can be saddled with burden of taxes or restrictions despite the provisions of Article 286 of the Constitution of India and the ratio laid down by the Apex Court in the matter of DFSs situated at Bangalore International Airport in the case of Indian Tourist Development Corp. Ltd v. CCT [ 2012 (2) TMI 62 - SUPREME COURT ]? HELD THAT:- In view of Section 5(2) read with Section 19(1) of the Sale of Goods Act, 1930, that the condition of sale/declaration printed on the invoice of DFS, pursuant to signatures by the outbound passenger and cashier, acts as a contract agreeing that the property in the goods purchased from DFS passes to such outbound passenger only when such outbound passenger lands at the final destination. Section 2(5) of the IGST Act defines export to mean taking goods out of India to a place outside India . In view of the above we are satisfied that supply by the DFS of the Petitioner to the outbound passenger constitutes exports by the DFS. Consequently, in terms of section 16(1) of the IGST Act, it becomes a zero rated supply - the Respondent-Authority has erroneously held that the Petitioner does not satisfy the crucial test of sending of the goods to foreign destination where they would be received as imports , to deny the benefits of zero rated supply. The import of goods in terms of section 2(10) of the IGST Act means bringing the goods into India from a place outside India. As per Section 7(2) of the IGST Act, goods imported into the territory of India, till such time it crosses the customs frontier of India, shall be treated to be a supply of goods in the course of inter-State trade and commerce. As per Section 2(4) of the IGST Act, the customs frontier of India means the limits of a customs area as defined in section 2 of the Customs Act. The duty free warehouse and DFS of the petitioner are only within the limits of the customs area and therefore, the goods lying therein do not cross the customs frontier and consequently, the importation will continue to be only in the state of inter-State trade and commerce in terms of Section 7(2). The customs duty and IGST is leviable only on removal of warehoused goods from the customs area, which happens when the arriving passengers leave the custom area. Since, the goods sold by DFS to arriving passengers do not leave the customs area, DFS is neither liable to pay customs duty, nor IGST. Significantly, in view of the CGST (Amendment) Act, 2018 effective from 1st February 2019, supply of warehoused goods before clearance for home consumption have been notified/classified under Schedule-III of the CGST Act as activities or transactions, which shall be treated neither as a supply of goods, nor a supply of services. Accordingly, effective from 1st February 2019, sale of goods from arrival DFS falls under entry 8(a) of Schedule-III to CGST/SGST Act. However, Since, supply of goods from departure DFS is export and the same is not cleared for home consumption, the same does not fall under Schedule-III of CGST/SGST Act. The impugned show cause notice dated 10th January 2019 are manifestly arbitrary and in the teeth of the purpose and intent of Article 286 of the Constitution of India and the provisions of the GST law read with the Customs Act, 1962 - SCN an order quashed. Regarding refund of ITC - Held that:- we refrain from issuing any declaration since the Petitioner is held to be entitled for refund of ITC and as such no prejudice will be caused to them, if they would first pay GST on the services provided to DFSs by MIAL and take ITC of the entire tax amount, and thereafter claim refund of the same by following the procedure contained in Rule-89.
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2019 (10) TMI 359
Detention order - section 129 of CGST Act - no discrepancy in the invoice as well as the e-way bill - Circular No.64/38/2018-GST dated 14.9.2018 - HELD THAT:- Issue Notice returnable on 9th October, 2019.
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2019 (10) TMI 358
Revocation of cancellation of registration - Section 30 of the CGST/HGST Act, 2017 - Petitioner submits that the present petition has become infructuous, as the competent authority has passed an order dated 01.10.2019, rejecting the application for revocation of the cancellation of registration of the petitioner-Company. HELD THAT:- It is admitted that the remedy against the aforesaid order dated 01.10.2019 is under Section 107 of the CST Act, 2017 by way of an appeal. The present petition stands dismissed as infructuous .
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2019 (10) TMI 357
Permission for withdrawal of petition - De-freezing of Bank Accounts - provisional attachment u/s 83 of CGST Act, 2017 - HELD THAT:- Petitioners, seeks leave to withdraw the petitions with liberty to file objection in terms of clause (5) of Rule 159 of CGST Rules, 2017 - Leave with liberty as prayed for, is granted. Petition disposed off as withdrawn.
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Income Tax
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2019 (10) TMI 356
Disallowing the Deduction u/s 80P(2)(a)(i) - Interest Received on Loans given to Nominal Members - HELD THAT:- Assessee is eligible for deduction of u/s 80P(2)(d) of the Act in respect of the amount invested in PDCC i.e., Cooperative Banks and other Banks. Further of the view that in the present case, the ratio of decision of the High Court in the case of M/s. S-1308 Ammapet Primary Agricultural Co-operative Bank Ltd. [ 2019 (1) TMI 116 - MADRAS HIGH COURT] would be applicable. Therefore following the ratio of the decisions cited herein above and the decision of Hon ble Bombay High Court hold that assessee is eligible for deduction u/s 80P of the Act. Thus, the grounds of allowed.
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2019 (10) TMI 355
Levy of penalty u/s. 271(1)(c) - validity of notice issued u/s. 274 r.w.s. 271 (1) (c) - non specification of notice - HELD THAT:- Levy of penalty by the AO u/s. 271 (1) (c) of the IT Act which has been upheld by the CIT(A) is bad in law since the notice does not specify under which limb of section 271 (1) (c) of the IT Act the penalty proceedings have been initiated. Therefore, the penalty levied by the Assessing Officer and sustained by CIT(A) is cancelled. - Decided in favour of assessee.
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2019 (10) TMI 354
TDS u/s 194I or 194J - transmission charges and SLDC charges paid by the assessee for the use of transmission network owned by AP Transco - HELD THAT:- First proposition of the assessee that the payments were made as per the order of the DRT and the TDS provisions are not attracted for payments made to DRT is concerned, we have gone through the order of the Hon ble DRT. The Hon ble DRT after considering the facts and merits of the case, allowed the petition filed by Industrial Development Bank of India (in short IDBI ) and directed the AP Transmission Corporation of India to deposit monies payable to the IDBI for the period from September 2002 to October 2003 and for subsequent period covered under the said contract. The DRT has not directed the AP Transco not to deduct the tax at source as required u/s 194I of the Act. The assessee also did not get clarification from the Hon ble DRT. Therefore, the assessee is bound to deduct the tax at source on the payments made to Klenn Marshall u/s 194I of the Act. Accordingly, we reject the contention of the Ld.AR on this argument. Contract was between the AP Transco and APSPDCL, but there was no contract or agreement between the assessee and Klenn Marshall and the liability was related to the period 2002-03 and 2003-04 for which the AP Transco has already raised the liability and the assessee is only discharging the liability, but not making any payment to Klenn Marshall - It is true that the tax deduction is required to be made on the payment which results into income of the beneficiary. The same attracts deduction at source. Every payment may not attract the TDS at source. In the instant case, the Ld.AR argued that the company M/s AP Transco is following the mercantile system of accounting and the liability was related to the F.Y.2003-04 and 2004-05 pertained to AP Transco, but not related to APSPDCL. Therefore, contended that the provisions of TDS are not applicable. For a query from the Bench, the Ld.AR did not place the financial statements, evidencing that the AP Transco has claimed the expenditure during the F.Y. 2002-03, 2003-04, 2004-05 and credited the amounts to the account of M/s Klenn Marshall and kept the payment pending and resultant the liability was transferred to the assessee company. AR failed to furnish the balance sheet of AP Transco and the account copy of the Klenn Marshall in the books of AP Transco before transfer and after transfer of the liability. As observed from the order of the AO, it is found that no credit entry was made prior to 01.06.2007, therefore, in the interest of justice, we are of the considered view that this issue requires verification at the level of the AO to examine whether the AP Transco has debited the expenditure and transferred liability to the assessee. Appeal of the assessee on this ground is allowed for statistical purpose. Payments made by the assessee to AP Transco is income in the hands of the payee and would fall for deduction of Tax at source u/s 194I Assessee in default u/s 201(1) - as observed from the order of the AO neither the demand u/s 201(1A) was raised in the order nor the demand notice was enclosed in the appeal papers. Though in appeal memo in form No.36 column No.5 mentioned the sections of 201(1)/201(1A) of the act, the department did not raise any ground with regard to interest u/s 201(1A) in the grounds of appeal. As a result the AO did not consider the assessee as assessee in default for the A.Y. 2008-09 and 2009-10 for the purpose of section 201(1) and no demand was raised u/s 201(1A), hence, the appeals filed by the revenue for the A.Y. 2008-09 and 2009-10 becomes in fructuous and hence dismissed. Demand raised by the AO for the F.Y. 2009-10, relevant to the A.Y. 2010-11 treating the assessee as assessee in default for application of provisions of section 194J - AO of the payee had issued the lower deduction certificate u/s 197 on 05.11.2009 for payment of transmission charges and SLDC charges for the F.Y. 2009-10 authorizing the payer for deduction of tax at source @1.75% for the amounts receivable by the payee on account of transmission and SLDC charges for the F.Y. 2009-10. The certificate u/s 197 is issued for whole year, but not for part of the year. Once the AO of the payee/or the authority concerned issue s the certificate for lower deduction the same is binding on the department and the payer is also obliged to deduct the TDS as per the certificate issued by the AO. The certificate is issued considering the estimated income of the assessee for the relevant assessment year and the tax payable thereon taking into consideration of the earlier records as well as the estimated receipts of the current year. This exercise is under taken to avoid unnecessary hardship and the financial burden to the tax payer and to avoid unnecessary refunds to the department which results in to the payment of interest. Therefore, on the basis of the certificate, if the assessee deducts the tax at source @1.75%, the same would be adequate and meet the liability and the AO (TDS) cannot find fault with it. It is accepted principle that the department need not collect the tax more than the tax liability of the tax payer. The department required to collect the correct and due taxes from the tax payer and the collection of more tax would cause financial hardship and effect the cash flow of the taxpayer. That is the reason, the provisions of section 197 were incorporated in the Act, so as to enable the payee to get the relief by obtaining certificate from the AO authorizing lower deduction of tax at source in genuine cases. Thus, we do not see any default in the case of the assessee for non deduction of tax at source over and above 1.75%.
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2019 (10) TMI 353
Addition made on account of leave encashment u/s 43B - Delayed payment -HELD THAT:- As during the course of hearing that hon'ble jurisdictional high court s decision in Exide Industries Ltd. vs. Union of India [ 2007 (6) TMI 175 - CALCUTTA HIGH COURT] quashing the statutory provision itself to be ultra vires. Hon'ble apex court [ 2009 (5) TMI 894 - SC ORDER] has stayed operation thereof vide order dated 08.05.2009. The assessee s instant former substantive ground is restored back to the Assessing Officer to be decided afresh after the final outcome in Revenue s appeal in Exide Industries Ltd. Disallowance in computing the book profit u/s 115JB relating to Industrial Promotion Assistance and Sales Tax Incentive - HELD THAT:- Subsidy was given by the Govt. of West Bengal for the purpose of enabling the entrepreneurs to establish new industry and also expand the existing industries. Under normal computation of income the subsidy given to promote the industries are not subject to tax, therefore, an item which is not taxable cannot be brought to tax under the provision of MAT. In holding so, we rely on the order of this co-ordinate Bench of this Tribunal in the case of Sicpa India (P) Ltd. [ 2017 (3) TMI 1383 - ITAT KOLKATA] The undisputed fact is that the incentive received by assessee is not in the nature of income earned during the course of business. Therefore, in our considered view, same cannot be regarded as income for the purpose of MAT u/s 115JB of the Act. Thus, the amount of incentive received by assessee should be excluded from the determination of book profit under the provision of Section 115JB - we reverse the order of Ld. CIT(A). and direct the AO to delete the same - Decided in favour of assessee Disallowance made on account of Industrial Promotion Assistance and Deferred Sales Tax Liability - HELD THAT:- It is noted that this Tribunal in assessee s own case for Assessment Year 2010-11 held that subsidies given to promote industries are not subjected to tax Disallowance made u/s 14A - CIT-A deleted the addition - HELD THAT:- This Court in Cheminvest Limited vs. Commissioner of Income Tax-VI, [ 2015 (9) TMI 238 - DELHI HIGH COURT] which ruled in the absence of any exempt income, disallowance under Section 14A of the Act of any amount was not permissible. Since the decision in Cheminvest Limited (supra) was followed, there is no substantial question of law that requires consideration Addition made by Assessing Officer on account of 14A u/s 115JB - HELD THAT:- Issue raised is decided by the decision of the Coordinate Bench of this Tribunal in the case of Goetze India Limited [ 2009 (5) TMI 615 - ITAT DELHI] wherein the similar addition made to the book profit of the assessee-company computed under section 115JB on account of disallowance of expenses made under section 14A was held to be unsustainable by the Tribunal holding that the provisions of section 14A could not be imported into Clause (f) of Explanation (1) to section 115JA.
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2019 (10) TMI 352
Addition u/s 36(1)(viii) - creation and maintenance of special reserve - HELD THAT:- Reserves are created as an appropriation out of Profit Loss Account and the terms Profit Loss Account General reserves as mentioned in the proviso could not be equated with each other, in the manner, as suggested by Ld. AR by relying upon the letter of Department of Company Affairs. The said circular, in our considered opinion, would have limited applicability in the context of which it has been issued and designed to apply in certain specific situation only. The expression used in the proviso are quite clear which mandates the inclusion of only the general reserves and nothing else. As per doctrine of literal interpretation, when the wordings in the statute are clear, the same has to be given the full effect. Therefore, we are unable to accept the arguments raised by Ld. AR, in this regard. Our view is duly supported by the cited decision of the Tribunal rendered on identical set of facts and circumstances. The coordinate bench has confirmed the stand of learned first appellate authority in excluding the balances in Share premium account, Profit Loss Account and special Reserve account while computing the general reserves. Nothing on record would suggest any change in facts or as to how the said ruling is not applicable to the facts of the case. Addition u/s 36(1)(viii) - year of assessment - HELD THAT:- The assessee could transfer / withdraw amounts to / from special reserve, from time to time, as per its own decision convenience. The limit placed by proviso to Section 36(1)(viii) was to be seen with reference to indices standing in assessee s financial statements at year-end and the disallowance was to be worked out as per the proviso to Section 36(1)(viii) for each year separately. During the year, the assessee could transfer / withdraw any amounts from / to special reserve. Therefore, there is no force in the argument of double taxation as urged by Ld. AR before us. In our opinion, the disallowance was to be worked out for each year separately keeping in view the closing balances standing in relevant accounts in the financial statements. This ground is decided against the assessee. Computations u/s 43D read with Rule 6EB - whether in the matter of revenue recognition, NHB guidelines would prevail over express provisions of Rule 6EB or the income has to be recognized strictly as per Rule 6EB ? - HELD THAT:- We are unable to accept the assertion that NHB guidelines would bring automatic corresponding change in Rule 6EB since, in our considered opinion, the discretion was left to the rule making authority to follow or not follow the NHB guidelines as and when they were revised since the substantive provisions uses the expression having regard to which would show the intention of legislature was to leave the discretion to the rule making authority. The said interpretation is in line with the decision of Hon ble Supreme Court in Rajesh Kumar V/s DCIT [ 2006 (11) TMI 135 - SUPREME COURT] interpreting the expression having regard to . Finally, keeping in view the facts and circumstances and respectfully following the decision of co-ordinate bench rendered in GIC Housing Finance Ltd. V/s ADIT [ 2011 (2) TMI 40 - ITAT, MUMBAI] we concur with the stand of Ld. first appellate authority in confirming the addition made by Ld. AO. At the same time, it is also true that some of the income may have been recognized by the assessee in subsequent years upon receipt of the same and the same would have been offered to tax in those years. However, upon perusal of quantum assessment order, we find that such income remained unquantified and therefore, no relief could be granted to the assessee, on this account. We are also not convinced with other arguments of Ld. AR that the deduction should be allowed as bad debts since the same would be governed by the requirements of Section 36(1)(vii)
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2019 (10) TMI 351
Disallowance of indirect expenditure claimed by the appellant as revenue/ period expenditure - HELD THAT:- CIT- A has identified each of the expenditure and isolated the expenditure based on the principle that the indirect expenses being period cost are allowable expenditure and there could be no justification for disallowing the claim of such expenses when the assessing officer himself has accepted and assess the revenue booked by the appellant during the year under consideration. He further referred to the accounting standard 7 issued by the Inst of chartered accountants of India wherein it has been stated that administrative and general expenses are not allocable or attributable to a specific contract and are to be considered as part of the contract cost and there should these expenses cannot be loaded to a particular contract. With respect to the allowability of the interest expenditure, the reliance was placed on the coordinate bench decision. He further held that sales and marketing expenditure are allowable indirect expenditure being a period cost but the commission expenses incurred for booking of the flats on various property is directly identifiable expenses of the specific project for which commission is paid to the dealer. In view of this we do not find any infirmity in the order of the learned CIT A Claim of deduction u/s 80IB - CIT-A has held that assessee has placed contradicting facts about the size of the flats and therefore CIT-A directed the learned assessing officer to verify the factual position regarding the area of residential unit having a built-up area of up to 1000 ft and grant the benefit of proportionate deduction accordingly - HELD THAT:- According to us, the learned CIT A has valid reason to direct the learned assessing officer to verify the fact. It is not in dispute that assessee has given written submission that built-up area of the residential unit is 1164 and 144 6 ft . This fact has been reproduced by the learned CIT-A in paragraph number 5.2 of his order. Thus, we do not find any infirmity in the direction of the learned CIT- A to the assessing officer. Further, the direction for granting the proportionate deduction is also based on the several judicial precedents. In any case the order passed by the learned assessing officer u/s 250 of the income tax act giving effect to the order of the learned CIT A passed on 30/3/2012 the learned assessing officer computed the same disallowance and thus the original disallowance made by the learned assessing officer stands. - Decided against revenue.
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2019 (10) TMI 350
Assessment u/s 153C r/w section 153A - proof of incriminating material has been unearthed pertaining to assessee having reflection on the income of the assessee - HELD THAT:- Both conditions have not been satisfied by the AO of the searched person and then AO of the other person, the assessee in this case, has mechanically proceeded to initiate the proceedings u/s 153C and 153A by merely recording the word satisfaction that the seized documents belong to assessee. It is difficult to make out from the satisfaction note recorded in case of searched person and in case of other person, the requisite satisfaction as required u/s 153C of the Act. We are constrained to record that both the satisfaction note dated 20.01.2014 and 23.01.2014 recorded in case of searched person and in case of such other person are identical and are not in consonance with the provisions contained u/s 153C of the Act. Furthermore, the AO has also failed to conclude as to how the alleged documents were incriminating in nature in order to assess the income of the assessee u/s 153C of the Act. So, in the absence of existence of any incriminating material, power u/s 153C cannot be invoked. When the assessment or reassessment, as the case may be, has been made u/s 153C, the necessary requirements to proceed with such initiation of assessment proceedings must be fulfilled. But, in the instant case, as discussed in the preceding paras, the AO has failed to record the satisfaction note as required u/s 153C rather mechanically recorded the satisfaction and made the assessment. The contention raised by the ld. DR and case laws relied upon are not applicable to the facts and circumstances of the case. - Decided in favour of assessee
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2019 (10) TMI 349
Proportionate disallowance of interest on advances to assessee s related concern DTTIPL - AO disallowed the interest mainly on the ground that the assessee firm had used interest-bearing funds for the purpose of providing interest free advances - CIT-A deleted the addition - HELD THAT:- In the case of SA Builders [ 2006 (12) TMI 82 - SUPREME COURT] had held that the expression commercial expediency is an expression of wide import and includes such expenditure as a prudent businessman incurs for the purpose of business. Once it is established that there is nexus between the expenditure and the purpose of business, the revenue cannot assume the role to decide as to how much is reasonable expenditure. FAA has also noted that the assessee firm had its own funds which were more than the amount of advances given to DTTIPL and, therefore, there was no occasion for the assessing officer to make disallowance on account of interest. While deleting the disallowance, it has also been noted by the Ld. First appellate authority that both the concerns pay tax at the same rates and, therefore, there was no loss of revenue. We are in full agreement with these observations and findings of the Ld. first appellate authority in this regard. DR could not point out if there was any perversity in these factual findings recorded by the Ld. first appellate authority - disallowance has been rightly deleted by the Ld. first appellate authority - Decided against revenue. Disallowance pertaining to subscription payments @ 25% - reason for AO for making the disallowance was that the same were excessive and not wholly and exclusively incurred for the purpose of the professional activities of the assessee - HELD THAT:- FAA while deleting the disallowance, has noted that the assessee firm contributes by way of subscription fees to Deloitte Global Services Holding Ltd and Deloitte Shared Services India (Pvt.) Ltd which is a global network of International Association of firms and companies rendering professional services. CIT (Appeals) had accepted the assessee s contention that the assessee s firm being a member of this global network and having Deloitte in its name brings in professional work in the form of reference by other member firms. CIT (Appeals) has also noted that a similar disallowance had been made in assessment year 2010 11 which had been deleted by the Ld. first appellate authority. We also note that the Department did not file any further appeal against this deletion made by the Ld. CIT (Appeals) in assessment year 2010 11. - Decided against revenue. Payment made to the retired partners - HELD THAT:- We find that an identical issue had come up before ITAT Chennai bench in the case of a related concern of the assessee in assessment year 2011 12 after relying on an order of CC Chokshi Co. [ 2010 (5) TMI 698 - ITAT MUMBAI] for assessment years 2000 01 and 2001 02 had held the issue in favour of the assessee. Also in the case of DCIT versus Wadia Ghandy Company [ 2019 (2) TMI 1283 - BOMBAY HIGH COURT] also upheld an identical order of ITAT Mumbai and noted that payment to the partner would amount to diversion of income at source by overriding title. - Decided against revenue
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2019 (10) TMI 348
Assessment of trust - AO assessing the extra fee collected from students as the income of the family head of the trustees instead of equally allocating among the trustees - CIT-A confirmed the addition - HELD THAT:- In our opinion, the CIT(A) passed a detailed order stating that there is evidence in the form of seized material marked as TP-4, TP-5 KRS placed. It is also supported by sworn statement of Shri Jose Thomas on 19/03/2009 and also of Smt. GracyBabu on 04/03/2009 placed. Being so, we do not find any force in the argument of the Ld. AR in pleading that collection of unaccounted fees should be allocated among the trustees of the Trust. Accordingly, we confirm the findings of the CIT(A). Assessment of fee - contention of the assesses is that only actual fees collected by the assessee is to be assessed and the amount receivable cannot be assessed - HELD THAT:- In earlier assessment years, the Assessing Officer had taxed only extra fees actually received and not the receivables. The CIT(A) also considered only the actual receipt of extra fees received in other assessment years except assessment year, 2009-10. CIT(A) only for this assessment year directed the Assessing Officer to take the entire extra fees both received and receivable. In our opinion, the CIT(A) cannot follow different yardstick for different assessment years. Accordingly, we direct the Assessing Officer to consider the actual extra fees received by the assessee to tax as unaccounted income. Thus, this ground of appeals of the assesses are partly allowed in both appeals. Treatment of amount received on sale of agricultural property vide registered sale deed as the amount received for relinquishment of trusteeship in the Trust - contention of the AR is that since there is no cost of acquisition, it is not possible to compute capital gain as section 55(2) of the I.T. Act does not include this kind of asset as capital asset - HELD THAT:- As concluded in BC SRINIVASA SETTY (AND OTHER APPEALS) [ 1981 (2) TMI 1 - SUPREME COURT] an asset which is capable of acquisition at a cost would be included within the provisions pertaining to the head Capital gains as opposed to assets in the acquisition of which no cost at all can be conceived. There was no cost of acquisition, which was determined and on the basis of which the Assessing Officer could have proceeded to levy and assess the gains derived as capital gains. Sub-section (2) of section 55 clause (a) having been amended, there is no stipulation with regard to relinquishment of trusteeship. However, even in the case of tenancy right, the view taken by the Supreme Court, after the provision was substituted w.e.f. 1st April, 1995, is as above, which is squarely applicable to the assessee's case also. The further argument of the Ld. AR is that the relinquishment of trusteeship cannot be brought within the tax net though it was capable of being transferred. The Supreme Court held that it must be capable of being acquired at a cost or that has to be ascertainable, then only transfer of capital asset is subject to tax. A specific insertion would therefore be necessary so as to ascertain its case for computing the capital gains. Since the assessee had not incurred any cost of acquisition in respect of gain on account of relinquishment of trusteeship in Carmel Educational Trust, it cannot be brought to tax as capital gains. Accordingly, we hold that capital receipt accrued to the assessee in AY 2009-10 and in that assessment year on relinquishment of trusteeship, which being a capital asset was acquired without any cost of acquisition, the same cannot be brought to tax - Decided in favour of assessee Assessment of amount received for civil construction work as income derived by the Trustees from the relinquishment of public charitable trust which was charged under the head other sources and also ignoring the expenses incurred - HELD THAT:- The Believers Church had disclosed this construction in its Balance Sheet as on 31/03/2010 and 31/03/2011. Being so, there was construction activity and the Believers Church paid the contract amount to these two assesses. By any stretch of imagination, it cannot be considered as an amount paid towards relinquishment of trusteeship in Carmel Educational Society. In our opinion, it is appropriate to estimate the income from construction contract amount at 8% for these assessment years. Directed accordingly. Thus the appeals of the assessee are partly allowed. Addition of sum received by St. Thomas Educational Society in which the assessee's were Trustees - HELD THAT:- This amount of ₹ 8 crores each was treated as income in the hands of these two assesses which was paid by Believers Church to St. Thomas Educational Trust where Shri Jose Thomas and Smt. Gracy Babu were trustees. The Assessing Officer assessed the amount of ₹ 8 crores in the hands of these two assesses as income from other sources as the receipt was in lieu of relinquishment of trusteeship in Carmel Educational Trust which was managed by Believers Church after the relinquishment of trusteeship by these two parties. The amount of ₹ 8 crores was not received by these two assesses but by St. Thomas Educational Trust, hence, it cannot be treated as income of these two assesses, as these assessees are different from Trust. Being so, we do not find any infirmity in the order of the CIT(A) and the same is confirmed. Denial of exemption u/s. 11 - HELD THAT:- It cannot be said that there is violation of section 13(1)(c)(ii) of the I.T. Act. If the Trustees themselves collected extra fees from the students for admission and retained it without authority, the Trust has nothing to do with that action of the Trustees and it cannot be said that the Trustees have been given any benefit or fruits of the Trust. The Trustees have unauthorizedly used the name of the Trust for the personal benefit of the Trustees and if the Trustees have failed to discharge their duty, with bona fide and earned certain benefit from the Trust, the Trust is not aware of that fact, the benefit of exemption u/s. 11 of the Act cannot be denied to the valid Trust. The Trust is only liable for the amount received from the Trustees out of the excess fees collected by them. If the excess fees collected by the Trustees was received by the Trust which was not accounted, the department can tax the same in the hands of the Trust and exemption u/s.11 of the Act can be denied on that amount and total denial of exemption u/s 11 is not possible. In the present case, the extra fees received by the assessee-Trust from the trustees was not accounted in the books of accounts of the assessee and also there is no evidence to show that it was applied for the purpose of charitable activities of the assessee-Trust. Thus, it is deemed that it was applied for purposes other than charitable purpose of the assessee-Trust - portion of extra fees received by the assessee-Trust is to be taxed at maximum marginal rate. The other income of the Trust is entitled to exemption u/s. 11 of the I.T. Act. And directed accordingly.This ground of appeals of the assessee is partly allowed. Enhancement by CIT(A) - excess capitation fees collected - CIT(A) observed that trustees of the assessee trust were collecting capitation fees from the students, part of which they were pocketed and the remaining was being handed over to the trust which was undisclosed in the books of accounts of the trust - enhancement made by the CIT(A) without giving any opportunity of hearing to the assessee - HELD THAT:- Unaccounted income received by the assessee -Trust from the Trustees is to be taxed at maximum marginal rate, there cannot be any enhancement of income so as to assessee the entire amount collected by the Trustees in the hands of the assessee- Trust. More so, the amount retained by the Trustees has been assessed in their respective hands. Thus, there cannot be any double addition. This enhancement was also made by the CIT(A) without giving any opportunity of hearing to the assessee which is violation of principle of natural justice. Thus, this ground of appeals of the assessee is allowed. CIT(A) observed that trustees of the assessee trust were collecting capitation fees from the students, part of which they were pocketed and the remaining was being handed over to the trust which was undisclosed in the books of accounts of the trust Enhancement made by the CIT(A) - Amount paid for construction of building - HELD THAT:- There was construction activity carried out by those two assesses as evidenced by the agreements cited supra and the construction was reflected in the balance sheet of the present assesses which was subjected to TDS. Thus, by any stretch of imagination, it cannot be said that there was no construction activity carried out by the assesses and it cannot be said that payments were not made towards construction of building which was for the establishment of educational institution. Thus, this ground of appeals of the assessee is allowed. Set off of excess application of earlier years - HELD THAT:- Since we have held that the assessee is entitled for exemption u/s. 11 of the Act, excess application of earlier years could be set off against deficits in the next assessment year. This view of ours is supported by various judgments in the cases cited by Ld. AR wherein it was held that the expenditure incurred by the Trust on religious/charitable purposes in earlier year or years can be adjusted against the income of the subsequent year irrespective of the head of income under which it was incurred. Accordingly, the Assessing Officer has to re-compute the income.
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2019 (10) TMI 347
Addition u/s 68 - unexplained cash credit - HELD THAT:- Turnover and profits of the share applicant company do not give any credence to the investments done with the assessee company while the revenue has brought on record all the evidences to prove that these share applicant entities are in fact shell companies. Rotation of the amount amongst the interconnected companies to provide share application money to each other has been clearly unraveled by the revenue. It is hereby held that the assessee has failed to discharge the primary onus to prove identity, creditworthiness and genuineness of transactions. Hence, relying on the facts enumerated above and judgments relied upon by the revenue, the addition made by the revenue u/s 68 of the Act is hereby confirmed.
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2019 (10) TMI 346
Addition u/s 68/69A treating the cash deposits as unexplained cash credit - whether deposits in the bank account of the assessee can be recorded as trading asset or whether such deposits are to be recorded as the income from unexplained source u/s 68/69? - HELD THAT:- While total deposit in cash was found to be ₹ 33,42,622/-, there is simultaneous withdrawal to the extent of ₹ 30,50,000/- during the year. The cash book filed by the assessee showing day-to-day generation of cash and deposits thereof also makes it clear that the assessee is engaged in systematic activity of retail business. The withdrawal of similar amount of cash substantiates the claim of the assessee to be engaged in retail business to a great extent. Coupled with this, the claim of the assessee also gains support from the statement recorded by the Investigation Wing u/s 132(4). The assessee has also supported its claim of being engaged in retail business by month-wise summary of retail transactions showing quantity and value. We are inclined to accept the cash deposit to be arising and attributable to retail trade. This being so and in view of the averments made on behalf of the assessee, the business income from retail trade may be estimated by invoking Section 44AF of the Act. Similar view has been echoed in CIT vs. Pradeep Shantilal Patel [ 2013 (11) TMI 1646 - GUJARAT HIGH COURT] and CIT vs. Surinder Pal Anand [ 2010 (6) TMI 404 - PUNJAB AND HARYANA HIGH COURT] As per the scheme of presumptive taxation provided u/s 44AF the estimated business income from aggregate cash deposits / turnover works by applying 5% thereon. The estimated income from the cash deposits in the bank is thus requires to be restricted to the aforesaid amount. AO is directed to do so
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2019 (10) TMI 345
Monetary limit - low tax effect - retrospective effect of the CBDT circular - HELD THAT:- In view of the CBDT Circular No.17/2019 dated 8th August, 2019 having retrospective effect as coordinate Bench of the Tribunal in case of Dinesh Madhavlal Patel [2019 (8) TMI 752 - ITAT AHMEDABAD] has already decided the issue as to the applicability of the captioned circular to the pending appeals in affirmative and what has been discussed above, we are of the considered view that the aforesaid appeal is not maintainable because of low tax effect i.e. less than ₹ 50,00,000/- hence, the aforesaid appeal filed by the Revenue is hereby dismissed having been become infructuous. However, in case, the present appeal is found to be maintainable at any stage for any technical reasons, the Department shall be at liberty to seek recall of this order under relevant provisions of law.
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2019 (10) TMI 344
Validity of notice u/s 143(2) - no notice by AO who held valid jurisdiction over the appellant s case given - transfer of jurisdiction of a case u/s 127 - curable defect - HELD THAT:- contention put forth by the ld. CIT, DR that provisions of Section 124(5) being overriding in nature, the ACIT Circle 21(1), New Delhi simultaneously held concurrent jurisdiction is devoid of any merit. Such interpretation is not in accord with the extant provisions of Section 124(5) read with Section 127 of the Act. The legal proposition pre-supposes that the original notice u/s 143(2) was issued by an officer who held valid jurisdiction over the case of the assessee. We however find that although in June 2016, the jurisdiction over the assessee s case was vested in ACIT, Central Circle 1, Ranchi, he never issued notice u/s 143(2). On the contrary the notice was issued by the ACIT, Circle 21(1), Delhi who, as held earlier, ceased to have jurisdiction over the appellant s case after 08.10.2008. - in the given facts of the case, the appellant s case was not saved by the provisions of Section 124(5) as also by Section 127(4). There was no necessity for the assessee to have questioned the jurisdiction of AO at Delhi, as envisaged under sub-sec. (3) of sec. 124 of the Act since in the first place AO at Delhi legally enjoyed jurisdiction u/s. 124 of the Act over the assessee s case. In our opinion such an order is bad in law as held by the Hon ble Supreme Court in CIT V Hotel Blue Moon [ 2010 (2) TMI 1 - SUPREME COURT] wherein has held that issue of a legally valid notice u/s. 143(2) is mandatory for usurping jurisdiction to frame scrutiny assessment u/s. 143(3) of the Act and absence of a valid notice u/s 143(2) is not a curable defect. This view was reiterated by the Hon ble Apex Court in the case of CIT Vs Laxman Das Khandelwal [ 2019 (8) TMI 660 - SUPREME COURT] . The decision of the Hon ble Bombay High Court in the case of Fiat India Automobiles Ltd Vs Vijender Singh [ 2012 (11) TMI 287 - BOMBAY HIGH COURT] support the legal ground canvassed by the appellant before us. We uphold the objections raised by the appellant against the validity of the impugned order u/s 143(3) for AY 2015-16. We accordingly hold that since in the present case no valid notice u/s 143(2) was issued by the AO who held jurisdiction over the case of the appellant, the consequent order passed u/s 143(3) dated 29.12.2017 was legally unsustainable and therefore is null in the eyes of law and therefore quashed. - Decided in favour of assessee.
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2019 (10) TMI 343
Long term capital - transfer within the meaning of Sec. 2 (47) - implementation of JDA - HELD THAT:- Possession is handed over to the builder only for limited purpose to enter upon the property for the purpose of implementation of JDA. In the present case, such permission to enter the scheduled property is granted subject to completion of certain conditions i.e. on approval of the plan and grant of licence for construction of the buildings from BBMP and/or from concerned authorities. As pe commencement certificate dated 24.08.2009 issued by BBMP as available on pages 261 of the paper book, permission was granted by BBMP for commencement of building construction work on 24.08.2009. Hence, even as per this permission granted by the land owners in the present case to the builders to enter upon the property for the purpose of implementation of JDA, the builder cannot enter upon the property prior to 24.08.2009 and hence, in the present year up to 31.03.2009, the builder cannot enter upon the property. Decision in the case of Smt. Lakshmi Swarupa vs. ITO [ 2018 (10) TMI 1345 - ITAT BANGALORE] followed, and the decision of HC [ 2012 (6) TMI 405 - KARNATAKA HIGH COURT] distinguished. In the case of Smt. Lakshmi Swarupa, The tribunal held that the possession granted is in the nature of permissive possession and not possession in part performance of agreement for sale. In the present case, even this permissive possession is not given to the builder prior to 24.08.2009. Hence, we hold that in the facts of the present case as discussed above, even permissive possession was not handed over to the builder in the present year - Decided in favour of assessee.
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2019 (10) TMI 342
Claim of deduction u/s 54F - CIT(A) allowed the additional evidences submitted by the assessee - HELD THAT:- AO has specifically mentioned the documents produced by the assessee which includes the statements, affidavits, agreements, bills, vouchers regarding the various works got done in respect of the construction of the house. The AO has not given any adverse comments or even not doubted the correctness of the evidence produced by the assessee. Therefore, when the AO himself was satisfied with the evidence produced by the assessee, then the claim of deduction under section 54F allowed by the CIT (A) based on the additional evidence as well as remand report of the AO cannot be disturbed in the absence of any contrary material brought on record by the department. Accordingly we do not find any error or illegality in the order of the ld. CIT (A) qua the issue of allowing the deduction under section 54F of the IT Act. Deduction u/s 54B - agricultural land purchased by the assessee in the name of his son and daughter-in-law - CIT-A allowed the claim - HELD THAT:- Evidence produced by the assessee being Jamabandi, Girdawari report etc. is only in respect of the land purchased by the assessee and not in respect of the land sold by the assessee. Therefore, the finding of the ld. CIT (A) is based on presumption of wrong facts and rather based on the facts which are contrary to the material on record. Accordingly, we set aside the order of the ld. CIT (A) qua this issue and restore the order of the AO denying the claim of deduction under section 54B Disallowance of cost of development of land - claim allowed by the ld. CIT (A) - HELD THAT:- Facts recorded by the ld. CIT (A) that the payment was made towards construction of the area admeasuring 450 ft. @ ₹ 400/- per ft has been reflected in the evidence produced by the assessee. The AO has not pointed out any defect in the evidence produced by the assessee in support of the claim. Accordingly, in the absence of any contrary fact or material, we do not find any error or illegality in the impugned order of the ld. CIT (A) qua this issue. Disallowance of transfer expenses - claim allowed by the ld. CIT (A) - HELD THAT:- In view of the fact that the assessee produced the evidence in support of the claim and the AO has not made any comment in the remand report about the correctness of the evidence produced by the assessee, then the decision of the ld. CIT (A) based on the evidence cannot be disturbed when the AO himself has not made any comment in the remand report. Reopening of assessment u/s 147/148 - HELD THAT:- The AO has clearly recorded in the reasons that during the enquiry proceedings the assessee has not furnished any documentary evidence in support of the claim. Therefore, the claim of deduction of ₹ 2,41,59179/- was found to be not substantiated by any evidence. This result of enquiry itself constitutes a tangible material to form the belief that the income assessable to tax in the form of excess claim of deduction has escaped assessment. We further note that even during the reassessment proceedings the assessee has not produced any documentary evidence in support of the claim and only in the appellate proceedings before the ld. CIT (A), the assessee first time produced the documentary evidence. Therefore, in these peculiar facts of the case, we do not find any defect or illegality in the initiation of proceedings under section 147/148 of the Act. The AO has done his best prior to initiating the proceedings under section 147/148 by conducting an enquiry in respect of the claim of deduction of ₹ 2.41 crores against the sale consideration of ₹ 2.43 crores - No substance or merit in the cross objection filed by the assessee. The same is dismissed.
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2019 (10) TMI 341
Disallowance of Salary paid to the partner - Increase in the salary - Support by the terms of partnership deed - HELD THAT:- Contention of the assessee that vide Clause 10 of the partnership deed dt. 01/12/2002 the salary may be increased or decreased from time to time in the interest of partnership business has not been rebutted. It is also noticed that the A.O. himself admitted in the assessment order that the assessee furnished addendum partnership deed which has been reproduced at page no. 6 of the said assessment order. In the said addendum to partnership deed it has been mentioned that the partnership deed was executed on 01/12/2002 and w.e.f from 01/04/2011, the remuneration to the partners had been increased to ₹ 12,000 each per month. A.O. did not accept the said addendum deed for the reasons that the Stamp Papers on which the addendum to partnership deed was written was dt. 01/12/2002. It cannot be a ground to disallow the claim of the assessee particularly when the remuneration claimed by the partners was not in excess of the amount prescribed in Clause (b) to Section 40 - claim of the assessee that in the subsequent years the increased salary had been accepted was not rebutted, therefore by considering the totality of the facts the disallowance made by the A.O. and sustained by the Ld. CIT(A) is deleted. - Decided in favour of assessee Non deduction of tds - Retainership expenses paid on account of Technical and Professional services to two persons - assessee submitted that the tax had not been deducted on retainership fee as the services were covered under section 192B and not under section 194C - contention of the assessee was that the payments were made during the festive season and it was remuneration in respect of sales boys who were not the regular sales employees of the assessee, both those persons filed their Income Tax Return and claimed it - HELD THAT:- In the present case the returns of income were furnished by Shri Daljeet Singh on 30/03/2013 wherein the income of ₹ 1,20,000/- has been shown as salary received from the assessee. Similarly Shri Pawan Kumar furnished the return of income on 07/05/2013 and had shown the salary of ₹ 1,80,000/- received from the assessee. In the present case when the income shown by the recipients had been accepted, there was no reason to doubt explanation given by the Assessee. Therefore, by considering the totality of the facts deem it appropriate to delete the addition made by the A.O. and sustained by the Ld.CIT(A). - Decided in favour of assessee
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2019 (10) TMI 340
Capital gain computation - Addition u/s 50C - Change in Circle Rate between the date of agreement and actual date of registration - whether the stamp duty valuation on the date of agreement will be relevant for the purpose of adopting full value consideration u/s 50C or stamp duty valuation as on the date of sale deed will be considered for this purpose - HELD THAT:- Tribunal held that proviso to Section 50C of the Act is effective from 01-04-2013 and amendment brought to Section 50C was treated as retrospective. The other decisions of the Tribunal as relied on by the ld.AR of the assessee have also taken consistent view that proviso to section 50C is having retrospective effect being remedial / clarificatory in nature. Following the decisions of the Coordinate Benches of the tribunal and in the absence of any contrary decision brought to my notice, I hold the DLC rate as on date of 31-07-2014 when agreement to sell was entered between the parties and part consideration received by the assessee through banking channel shall be taken as full value consideration. Accordingly, the AO is directed to adopt full value consideration as DLC rate on the date of agreement and if sale consideration shown in the sale deed is more than DLC Rate of the property as on s31-07-2014 then no addition u/s 50C - Decided in favour of assessee.
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2019 (10) TMI 339
Revision u/s 263 - unexplained cash deposits - HELD THAT:- From the perusal of the order sheet entries, it is seen that only effective date of hearing was 03.03.2017, wherein he has noted that Shri P.K. Jain, FCA filed representation and replies to the show cause notice and case is heard. Thus, nowhere the additional issues raised by him were ever confronted to the assessee. In any case, here scope of entire reassessment was based on the reasons recorded by the AO and Pr.CIT cannot travelled beyond the reasons to rope in other issues not falling in the reasons recorded. Thus, we agree with the contention of the learned counsel that any such direction is beyond the scope of re-assessment proceedings as the same cannot be raised in revisionary jurisdiction u/s 263. Hence, all other direction given by the PCIT is quashed. Even on the issue of cash deposit, as has stated above, Assessing Officer has duly examined not only all the persons who have given the advance to the assessee but also the entire cash flow statement, vis- -vis the assessee s computation of income and cash flow statement coming from Assessment Year 2009-10. Pr.CIT without finding any defect in the inquiry conducted by the Assessing Officer has simply cancelled the assessment order which cannot be sustained. In case he is of the opinion that Assessing Officer inquiry and verification is lacking, then it is incumbent upon the ld. Pr.CIT to himself conduct prima facie inquiry on his own so as to reach to a conclusion that, either the Assessing Officer s inquiry was not proper or there is any inherent lack of application of mind. Hon'ble Delhi High Court in the following cases:- i) DIT vs. Jyoti Foundation [ 2013 (7) TMI 483 - DELHI HIGH COURT] ii) CIT vs. Sunbeam Auto Ltd [ 2009 (9) TMI 633 - DELHI HIGH COURT] ; and iii) ITO vs. D.G. Housing Projects Ltd, [ 2012 (3) TMI 227 - DELHI HIGH COURT] has categorically held, the revising authority must make an inquiry before making a believe that assessment order was erroneous and without making any such inquiry he cannot remand back the issue once again to conduct the inquiry when Assessing Officer has conducted inquiry before conclusion of assessment. Thus we do not find that it is a fit case for cancelling the assessment for framing fresh even on the issue of examining the source of cash deposit, because what ld. Pr.CIT has directed the Assessing Officer to re-verify the receipt of advance from the persons which has been duly examined by the Assessing Officer in the manner discussed above. Accordingly, the impugned order u/s.263 is quashed. - Decided in favour of assessee.
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2019 (10) TMI 317
Extraordinary and discretionary jurisdiction of High Court - maintainability of appeal - Single Judge directing the appellant to exhaust the statutory remedy - whether the appeal requires to be decided on merit or not? - Section 115-O invoked unilaterally and without adjudication by treating the transactions as that of dividend, which would not come within the purview of Section 2(22)(d) - HELD THAT:- In issues involving fiscal statutes, extraordinary and discretionary jurisdiction of this Court available under Article 226 of the Constitution of India requires to be exercised with greater caution and very sparingly. The learned single Judge has given two findings against the appellant while holding that it is open to him to file an appeal. Though it is observed that the observations are only prima facie in nature, the writ petition was dismissed on the reasons assigned. Therefore, the findings rendered cannot be termed as prima facie as they were not mere observations. As the learned Senior Counsel appearing for the appellant submits they might militate against the appellant as substantive findings on merit. If that is the case, the appeal to be filed would be of a mere formality. Thus, the learned single Judge, in our considered view, ought not to have gone into the merits of the case. The first finding rendered by the learned single Judge is to the effect that the transactions are not mere buying back of shares but granting dividend to the shareholders. Secondly, it was held that there is no need to follow any procedure towards adjudication while invoking Section 115-O of the Act. Having given the aforesaid findings, the writ petition was accordingly dismissed. This is in our considered view cannot be sustained in the eye of law. They are not mere observations but findings on merit both on fact and law. In such view of the matter, we are of the view that the learned single Judge was not right in going to the merit while granting liberty to file an appeal. A submission is also made raising doubt over the maintainability of the appeal under Section 246-A of the Act. We have no hesitation in holding that the appeal is maintainable. The very case of the respondent is that the appellant ought to have shown its return the transactions as dividend and not capital gain. Therefore, it is a case of an improper return having been filed. Considering some what similar objection raised on a slightly different fact involving a demand raised under Section 115Q of the Act, a Division Bench of Delhi High Court in Genpact India (P) Limited Vs. Deputy Commissioner of Income-Tax (2019 (8) TMI 997 - DELHI HIGH COURT) was pleased to hold that the appeal would certainly be maintainable. Therefore, any order involving civil consequence has to be termed as final, entitling an assessee in challenging the same before the appellate forum. We also do not find any error in the order of the learned single Judge with respect to the deposit made during the pendency of the interim order as erroneous. It is only an interim arrangement directed to be made pending the appeal. In such view of the mater, while upholding the direction of the learned single Judge with respect to the deposit and the liberty granted to file an appeal are accordingly upheld. However, the findings rendered on the nature of transaction and the scope under Section 115-O of the Act are accordingly set aside. The issue as to whether the impugned order should be preceded by a procedure involving adjudication and the requirement of violation of principles of natural justice are also left open to be decided in the appeal. Accordingly, the writ appeal stands allowed in part as indicated.
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2019 (10) TMI 316
Claim of deduction u/s 80P(2)(b) - assessee has sold the milk at a higher rate to outside parties - HELD THAT:- We find force in the argument of the Ld.A.R. that it is not a case where assessee has sold the milk at a higher rate to outside parties, in fact assessee was getting higher price on sale of milk to Federal Society in addition to undisputed benefit of deduction u/s 80P(2)(b). It is not a case where assessee has suo-moto volunteered to sell milk in the open market. It was after the denial of Federal Society to accept the milk that the assessee was constrained to sell the milk in open market at a price lower than the price offered by Federal Society. The Hon ble Apex Court in the case of Bajaj Tempo Limited Vs. CIT [ 1992 (4) TMI 4 - SUPREME COURT] has held that a provision in a taxing statute which grants incentives to promote growth and development should be construed liberally so as to advance the objective of the section and not to frustrate it. It is an undisputed position that provisions of deduction u/s 80P is a provision to promote development of Co-operative Sector. Considering the totality of the aforesaid facts and relying on the aforesaid decision of Hon ble Apex Court cited herein we are of the view that assessee is eligible for deduction u/s 80P2(b) on the milk sold to outside parties. The assessee would be eligible for the benefit of deduction u/s 80P(2)(b) on sale of milk at a price at which it has actually sold in the open market or price at which milk is sold to Federal Society, whichever is less. For the month of August, 2008, there is no sale of milk by the assessee to the Federal Society and the sale of ₹ 1,24,34,116/- is only to outsiders, hence, we are of the view that benefit of deduction should not be extended on sale of milk for the month of August, 2008. We therefore direct the AO to re-compute the deduction u/s 80P(2)(b) of the Act by excluding the sale made to outsiders in the month of August, 2009
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Customs
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2019 (10) TMI 338
Provisional release of goods - import of Betel nuts - it was alleged that the goods were deteriorated in quality and is not fit for human consumption - Notification under section 5 of the Foreign Trade (Development and Regulation) Act, 1992 - HELD THAT:- It is absolutely plain that the observation of the Division Bench that the respondents had been knocked out was to be taken as prima facie. The Ghaziabad report along with all other evidence, which the appellant had produced to prove that the goods were fit for human consumption at the time of importation and thereafter, were to be considered by the Hon ble first court on the basis of the affidavits to be filed and the exception to the report. The case in the writ application as a whole was also to be considered by the Hon ble first court upon exchange of affidavits. We do not find from the said order dated 13th January 2016 that any point taken in the writ application was closed by it. Impugned order set aside - the writ remanded to the Hon ble first court with a request to decide the same as early as possible, especially considering the fact that six years have passed since importation of the goods.
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2019 (10) TMI 337
Seizure of vessel - FC Maria Laura - evasion of customs duty - extension of Bank Guarantee for further period of three months - HELD THAT:- We are satisfied that the bank guarantee is required to be discharged by accepting undertaking on behalf of Fomento that the vessel will not be taken out of the jurisdiction of the Customs (in Goa) pending Fomento's appeal before CESTAT, without seeking leave from CESTAT. This is because the material on record makes it clear that Fomento was required to give this bank guarantee, in the first place, only because Fomento desired to take this vessel beyond the jurisdiction of Customs, in variation of our interim order dated 16.01.2018. The bank guarantee, was to really operate until Fomento returns the vessel within the jurisdictional limits of the Customs within the time stipulated. There is no dispute that the vessel was returned, though, with some marginal delay which was also deemed to be condoned. Today, admittedly, Fomento has appealed the adverse order dated 28.05.2019 by making requisite pre-deposit. In terms of the Circulars dated 16.09.2014 and 10.03.2017, even the Customs does not dispute that the demand pending appeal is not to be recovered by coercive means. In such a situation, it will not be appropriate to require Fomento to maintain the bank guarantee as a precondition for Customs not initiating coercive proceedings to enforce demand. Application dismissed.
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2019 (10) TMI 336
Valuation of imported goods - inclusion of the ship demurrage charges incurred by the appellant in the assessable value - Section 14 of the Customs Act - HELD THAT:- The Hon ble High Court of Orissa in the case of Tata Steels [ 2019 (10) TMI 226 - ORISSA HIGH COURT ] has declared the proviso to Rule 10 (2) of the Valuation Rules to be ultra virus. Revenue has not brought any ruling contrary to the judgement of Hon ble High Court of Orissa wherein the proviso appended to Section 10 (2) of the Valuation Rules has been struck down. The impugned order is not sustainable - appeal allowed - decided in favor of appellant.
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2019 (10) TMI 335
Valuation of imported goods - Brass Valve Zinc Valves - rejection of declared transaction value - Rule 12 of Customs Valuation (Determination of Price of imported Goods) Rules, 2007 - HELD THAT:- The issue is squarely covered by the decision of tribunal in case of S.K. DHAWAN AND RAJEEV SETH, ESSFO IMPEX PVT. LTD. AND ESS DEE TRADING CO. VERSUS COMMISSIONER OF CUSTOMS (IMPORT) , MUMBAI [ 2016 (3) TMI 888 - CESTAT MUMBAI] where it was held that the appellant importer had submitted details of contemporaneous imports of the same goods and the value seems to be more or less is same as declared by the appellant importer is not addressed to and also the adjudicating authority has not recorded a single sentence of finding on such contemporaneous import detail given by the appellant and thus the rejection of value was not supported. The distinction sought to be made by the learned Authorized Representative, do not address the crux of issue of rejection of transaction value - Without rejecting the transaction value, the application of any other rule, for re-determination of the value for the purpose of levy of Custom Duty is neither permissible nor admissible position in law as per the decision referred to by counsel for law. Appeal allowed - decided in favor of appellant.
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2019 (10) TMI 334
Imposition of penalty u/s 112(a) of CA on Customs Broker / CB - various irregularities committed by the main importers - no proceedings were initiated against the Customs Brokers alleging that by filing of Bill of Entry related to goods which are found liable for confiscation, the Customs Broker abetted such illegal import over past years - HELD THAT:- The penalties have been imposed under Section 112(a) of the Customs Act. The said Section provides for imposition of penalty on any person who abets the doing or omission or any act or omission which will render the goods liable to confiscation. In other words, there should be a clear evidence to come to the conclusion that the appellants by their specific act or omission or any act abetted the illegal importation of offending goods. In the impugned order, no such evidence has been recorded. Further, for penalty under Customs Act, 1962, it is apparent that mere filing of Bill of Entry without the knowledge or of role in the importation of cargo is not sufficient. Penalties not warranted and is set aside - appeal allowed - decided in favor of appellant.
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2019 (10) TMI 333
Quantum of redemption fine and penalty - Valuation of imported goods - enhancement in the declared value - violation of Import Trade Control restrictions - HELD THAT:- The Ld. Commissioner (Appeals) has ordered reduction of redemption fine and personal penalty on the basis of ratio laid down by the Three Member Bench of CESTAT, Delhi in the case of M/S. OMEX INTERNATIONAL VERSUS COMMISSIONER OF CUSTOMS, NEW DELHI [ 2015 (4) TMI 112 - CESTAT NEW DELHI (LB)] . The Three Member Bench has taken the view that redemption fine of 10% and penalty of 5% of the value of the imported goods, would be appropriate in case of import violating Exim Policy Provisions - there are no reason to interfere with the findings of the Ld. Commissioner (Appeals) on the basis of such decision. Appeal dismissed - decided against Revenue.
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Insolvency & Bankruptcy
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2019 (10) TMI 332
Maintainability of application - initiation of CIRP - Corporate Guarantee has been given by Corporate Debtor or not? - pre-existing dispute or not - Section 7 of the I B Code - HELD THAT:- In the case of M/S. INNOVENTIVE INDUSTRIES LTD. VERSUS ICICI BANK ANR. [ 2017 (9) TMI 58 - SUPREME COURT ] it was held that Once the Adjudicating Authority is satisfied on the basis of records that the debt is payable and there is default, the Adjudicating Authority is required to admit the application. The Respondent M/s Pashupati Jewellers having enclosed the copy of the Corporate Guarantee and Undertaking Agreement dated 7th April, 2017 instituted on e-Stamp, issued by Government of National Capital Territory of Delhi, it was not open to the Adjudicating Authority to deliberate on the issue whether e-Stamp is a forged document or not - Merely because a suit has been filed by the Appellant and pending, cannot be a ground to reject the application under Section 7 of the I B Code. Pre-existing dispute cannot be a subject matter of Section 7, though it may be relevant under Section 9 of the I B Code. Appeal dismissed.
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2019 (10) TMI 331
Grant of interim relief - matter pending before adjudicating authority - Service of notice - HELD THAT:- Taking into consideration that the matter is pending before the Adjudicating Authority, we are not expressing any opinion with regard to the interim relief as sought for, which the Adjudicating Authority is required to decide after hearing the parties - However, we expect that, in the meantime, Deputy Commissioner of Customs will not sell or alienate the property, (if not already sold or alienated) to make the interim application infructuous - appeal disposed off.
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Service Tax
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2019 (10) TMI 330
Maintainability of application - payment of outstanding installments alongwith interests - HELD THAT:- The tentative revised instalments will be paid punctually by the appellant/applicant by the 7th of each month after June, 2019. On this basis, the instalment for June, 2019 may be paid by the appellant/applicant by 20th June, 2019. But the subsequent instalments shall have to be paid by the 7th of each succeeding month. The merit of this application, which is treated as an application for implementation of the order dated 25th February, 2019, including its maintainability will be decided on the returnable date of this application - If there is failure to pay by the appellant/applicant, the default clause in the said order dated 25th February, 2019 shall become operative. Application disposed off.
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2019 (10) TMI 329
CENVAT Credit - input services - various insurance policies taken by the assessee in respect of various employees working at site - period post 1.3.2011 - Difference of Opinion among two benches - HELD THAT:- There are two views expressed by the Tribunal on this point - In the case of M/S HYDUS TECHNOLOGIES INDIA PVT LTD. VERSUS CCE, C ST, HYDERABAD-II [ 2017 (2) TMI 538 - CESTAT HYDERABAD] , the Bench has taken a view that assessee can avail CENVAT credit of the service tax paid on various insurance services post 01.04.2011, even after the definition of the input services under clause (c) specifically excluded the life insurance and health insurance services, if the said insurance is in pursuance to the Central Excise Act or the Acts which amended the employer to do so - At the same time, in the case of M/S. GANESAN BUILDERS LTD VERSUS COMMISSIONER OF SERVICE TAX, CHENNAI-II [ 2017 (7) TMI 720 - CESTAT CHENNAI] , the Tribunal at Chennai took a diagonally opposive view wherein, while interpreting the same clause of the definition of Input services, it was held that CENVAT credit cannot be allowed. Since both the Benches are of the same strength and there being diagonally opposite views expressed, I refer the matter to the President, CESTAT for constituting Larger Bench to arrive at a conclusion as to whether the view expressed by Hydus Technologies India Pvt. Ltd. is correct or the view expressed by the Bench in the case of Ganesan Builders Ltd. is to be followed. Registry is directed to forward copy of this order alongwith the case laws cited to Hon ble President, CESTAT to refer the matter to Larger Bench, to decide the issue - Matter referred to Larger Bench.
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2019 (10) TMI 328
Refund of service tax - rejection on the ground that condition (b) in paragraph no. 3 of notification no. 41/2012-ST dated 29th June 2012 and of ₹ 10,57,754/- for having been sought after the period of limitation prescribed therein - HELD THAT:- A special provision for discharge of tax liability by the recipient, which may not have been anticipated when the general scheme of rebate was devised, should stand in the way of the more fundamental principle that taxes should not be allowed to insinuate into the value of exports. Time limitation - HELD THAT:- As pointed out by Learned Authorised Representative, the decision in which a contrary view was taken were those in which the amount claimed was not revised by a subsequent application which had the effect of enhancing the claim itself - the decision cited by Learned Counsel is not a binding precedent for advancing the date of filing of claim for the enhanced amount, and thus, bring the claim within the prescribed period. We modify the impugned order by allowing refund to the extent of ₹ 56,27,388/- while upholding the rejection of ₹ 10,57,754/- - Appeal allowed in part.
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2019 (10) TMI 327
Refund of service tax - rejection of refund on the ground that the services provided by the appellants do not qualify as export of services - whether the services rendered by the appellant to AMSI France will qualify as Export of Services in terms of Export of Service Rules, 2005 as amended from time to time? - Rule 3 of Export of Service Rules, 2005 - Difference of opinion. HELD THAT:- There are contrary views expressed by the coordinate benches of tribunal, judicial propriety demands that matter should be referred to Hon ble President for constituting a larger Bench to resolve the issues. The matter referred to Hon ble President to constitute a larger bench to determine the extant and scope of phrase such taxable services which are provided and used in or in relation to commerce or industry and the recipient of such services is located outside India used in Rule 3(3)(i) of Export of Services Rules, 2005 upto 18.04.2006, extant and scope of phrase such service is delivered outside India and used outside India used in Rule 3(2)(a) of Export of Services Rules, 2005 from 19.04.2006 to 28.02.2007, extant and scope of phrase services provided from India and used outside India used in Rule 3(2)(a) of Export of Services Rules, 2005 from 01.03.2007 onwards and also Whether the services rendered to foreign entity located outside India for development of its business in India will qualify as Export of Service in terms of the above phrases used in the Export of Services Rules, 2005 from time to time and the decision of Apex Court in case of GVK INDUSTRIES LTD. ANOTHER VERSUS THE INCOME TAX OFFICER ANOTHER [ 2015 (2) TMI 730 - SUPREME COURT] ?
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2019 (10) TMI 326
Taxability - GTA Services - whether the GTA services used for transportation of foodstuff, which are exempted in terms of the mega notification, would apply vis- -vis the transportation of the edible biscuits? - Revenue s only contention is that biscuits cannot be held to be foodstuff. HELD THAT:- We really fail to appreciate the above contention of the revenue, inasmuch as, the biscuits in question are edible biscuits and not gold biscuits. The eatable biscuits would definitely fall under the category of foodstuff. Inasmuch as, the biscuits, as discussed by commissioner (Appeals), is nothing but food, the size and timing for eating the same may change but never the less biscuits remains food item only. No reason stands given by the revenue as to why the biscuits has to be held as different from the category of food. The only contention of the revenue is that foodstuff is relatable to only those items which can be further processed and the biscuits which are ready to use cannot be held to be foodstuff - there are no merits in the above stand of the revenue - The foodstuff is a clear, unambiguous word and there is nothing to indicate that the same would apply to transportation of the raw material etc. which have to be further converted into a final edible product. Appeal dismissed - decided against Revenue.
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2019 (10) TMI 325
Levy of service tax - NSE/BSE transaction charges - SEBI turnover fee recovered from their clients in addition to the brokerage charges - HELD THAT:- The issue is no longer res-integra and the issue whether the NSE/BSE charges and SEBI turnover fee are liable for service tax has been decided consistently by this Tribunal in various judgments wherein it was held that the actual charges paid to NSE/BSE and SEBI fee and taking reimbursement from the clients is not liable for service tax. Reliance placed in the case of INDSES SECURITIES AND FINANCE LTD, SPAN CAPLEASE PVT LTD AND OTHERS VERSUS C.S.T. -SERVICE TAX - AHMEDABAD [ 2018 (2) TMI 569 - CESTAT AHMEDABAD] . Appeal allowed - decided in favor of appellant.
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2019 (10) TMI 324
Business Auxiliary Service - amount collected from the customers under the new scheme called Passport Bonus Card Scheme on behalf of the manufacturer for servicing of motor vehicles and for benefits after the warranty period - period 2004-05 to 2008-09 - HELD THAT:- The appellants were only collecting the amount on behalf of the manufacturers from their customers without any commission or any other incentives. There is no evidence to show that appellants retained any money so collected - When there is no inflow for the appellants, there may not be any allegation of such activity to come within the ambit of the definition of Business Auxiliary Services under section 65(19) of the Act ibid . The impugned order to the contrary cannot sustain - Appeal allowed - decided in favor of appellant.
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2019 (10) TMI 323
Classification of services - Business auxiliary services or manpower supply and recruitment services? - Devolution of tax liability - cost of transportation of the harvested sugarcane to the factory of M/s Vasant Sahakari Sakhar Kharkhana Ltd. - HELD THAT:- The Tribunal has, in SATARA SAHAKARI SHETU AUDYOGIK OOS TODANI VAHTOOK SOCIETY VERSUS CCE., KOLHAPUR [ 2014 (12) TMI 42 - CESTAT MUMBAI] , held that there is no element of manpower supply or recruitment by the appellants to the sugar factory and therefore, the services rendered by the appellants cannot be classified under manpower recruitment or supply agency services, by any stretch of imagination The findings in the impugned order do establish that the appellant was a mere intermediary between its constituents, albeit as a separate artificial person, and the labour contractors to empower in securing most economical supply and to ensure handing over of consideration from the dues, held by M/s Vasant Sahakari Sakhar Kharkhana Ltd, in accordance with the public procurement policy for sugarcane. Appeal allowed - decided in favor of appellant.
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Central Excise
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2019 (10) TMI 322
Refund of excise duty paid - central excise duty was paid out of Cenvat input credit enjoyed by them - HELD THAT:- The issues should be decided threadbare by the revisional authority upon consideration of the entire evidence to be adduced by the parties. We give an opportunity to the appellant to adduce further evidence by way of an affidavit before the revisional authority to be filed within four weeks from date. We also grant a similar opportunity to the respondents. Their affidavit is to be filed within four weeks thereafter. The revisional authority will examine the matter thoroughly upon notice to and upon hearing to the parties by a reasoned order within six months from date - Impugned order set aside.
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2019 (10) TMI 321
Principles of natural justice - ex-parte order - appellant submits that since the notices were not received by his client, they were not aware of and could not participate in it - HELD THAT:- A salutary constitutional principle is that a person should be heard before he is condemned. The underlying legal principle is that a person should be given an opportunity to defend himself. Here, there is substantial evidence to suggest that the appellant may not have been aware of the date of personal hearing. The appellant had suffered an ex parte order making it liable to pay a huge amount in the shape of duty, interest and penalty. The learned judge made an error in not appreciating this position and in rejecting this point made by the applicant. Furthermore, the learned judge, while relegating the appellant to an alternative remedy, had rejected the argument that the said order of the Commissioner had been passed without giving the appellant an opportunity of being heard. This immediately meant that the adjudication order passed without hearing the writ petitioner was held to be not violative of the principles of natural justice - This substantially impairs the rights of the appellant. It is rendered ineligible to establish their rights before the lowest adjudication authority. Furthermore, this point was closed before the appellate authority. The court while relegating a party to the alternative remedy should keep all points open before that authority. The Commissioner is directed to re-hear the show cause notice upon giving the appellant an opportunity of hearing by a reasoned order within four months of communication of this order - impugned order set aside.
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2019 (10) TMI 320
Implementation of order - payment of installments - withdrawal of the amount from attached accounts - appellant submits that HDFC bank is not allowing the company to withdraw any amount from the account - HELD THAT:- We feel that in the absence of this determination by the service tax authority the bank is rightly not permitting appellant no. 1 to make any withdrawal from the attached account. The Commissioner is directed to make an additional decision with regard to the above issue within three weeks of communication of this order. DDepending on his decision HDFC bank will allow the appellant no. 1 to make payment out of the attached account - application disposed off.
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2019 (10) TMI 319
CENVAT Credit - capital goods / inputs - construction of building structure - used in relation to setting up' - period from April 2013 to March 2015 - issue already decided by Tribunal - HELD THAT:- On the same services, the appellant had filed the appeal which was allowed by the Tribunal in UNI ABEX ALLOY PRODUCTS VERSUS COMMISSIONER OF CENTRAL TAX, BELAGAVI COMMISSIONERATE [ 2019 (2) TMI 569 - CESTAT BANGALORE] - On the same services, another SCN was issued by the Division Officer based on the Range Officer observation. Since this Tribunal has already allowed the appeal by the appellant on the same services and the Revenue seeks to demand service tax twice on the same services which is not permitted under law. Impugned order set aside - appeal allowed - decided in favor of appellant.
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2019 (10) TMI 318
CENVAT Credit - input services - construction, repairs, extension works etc in the mining area - HELD THAT:- This Tribunal in their own case WESTERN COALFIELDS LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE NAGPUR II[ 2019 (5) TMI 1346 - CESTAT MUMBAI ] while considering the admissibility of CENVAT Credit availed on support structures of roof holding the mines, interpreted the scope of civil structures and observed that the roofing in mine offers protection from the possibility of mud shifting in the area. Therefore, it hardly conforms to the expression of civil structure . Thus, the ventilation stopping area and isolation stopping area cannot be called as civil structure, accordingly, CENVAT Credit availed by the Appellant on the input/input services cannot be denied.
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