TMI Tax Updates - e-Newsletter
June 4, 2019
Case Laws in this Newsletter:
GST
Income Tax
Customs
Corporate Laws
Insolvency & Bankruptcy
Service Tax
Central Excise
CST, VAT & Sales Tax
Indian Laws
Highlights / Catch Notes
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GST:
Power of arrest u/s 69(1)of CGST Act - when the very arrest of the petitioners is not prohibited prior to the completion of the assessment, any coercive action lesser than arrest, can not also be said to be prohibited - writ dismissed
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GST:
Constitution of the GST Tribunal in UP - headquarter at Praygraj OR Lucknow - There are two Seats of the High Court of Judicature at Allahabad, one at Lucknow and the other at Allahabad, none of which is permanent - Court directed to set up GST Benches as per proposal dated 21.02.2019 i.e Head Quarter at Lucknow with constitution of 20 Area Benches in 16 Cities
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Income Tax:
Revision u/s 263 - notice issued on several points - assessee could not rebut the findings of the Ld. PCIT in respect of points ‘b’ and ‘c’ which proves that the order of the AO was erroneous and prejudicial to the interest of Revenue as the AO had failed to make any proper required enquires to frame the assessment - revision upheld
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Income Tax:
Penalty u/s 271B - violation of section 44AB - TAR obtain within time but filed with belated return - amended Rule 12(2) w.e.f 01.04.2013 - when the amended rule was not applicable as on 30th September, 2012, the assessee has made out the clear case of reasonable cause - no penalty
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Income Tax:
Seizure of cash in election by ECI - IT Dept. has completely failed to appreciate that neither the seizure was u/s 132 nor the pre-requisite to an exercise of search and seizure u/s 132 were satisfied nor the requisition satisfies the provisions of Section 226(3), which is the only provision enabling the IT Dept. to take over the money apart from the search and seizure - directed to refund with interest @ 10%
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Income Tax:
Seizure of cash in election - seizure itself was without sanction of law which is apparent from the fact that no F.I.R. or complaint was instituted - The illegality is perpetuated because the guidelines do not empower the authorities connected with conduct of the Elections to transfer money deposited in the Treasury to the Income Tax Department on their dictates - directed to refund with 10% interest
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Income Tax:
Loss from derivative transactions in Commodity Futures and Options - speculative loss OR not - CBDT, on 22nd May 2009, recognizing MCX as recognized Stock Exchange for the purpose of section 43(5) - recognition by the Central Govt. of the Stock Exchange from a later date will not debar the transaction as non-speculation, especially after 1st April 2006 - treated as normal business loss
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Income Tax:
Addition u/s 69 - unexplained investment found in the form of loan given to a party which was not recorded in the books of account of the assessee and the explanation offered by him about the nature and source of the said investment was not found to be satisfactory - the addition u/s 69 was fully justified
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Income Tax:
Penalty u/s 271(1)(c) - Since the assessee had furnished full particulars about the expenditure incurred including non–deduction of TDS in the tax audit report itself, it cannot be accused of furnishing inaccurate particulars of income - failure to disallow the amount u/s 40(a)(ia) was due to a bona fide mistake is acceptable - penalty deleted
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Income Tax:
Reassessment u/s 147 - in statement name of the assessee also found mentioned in the list of beneficiaries of bogus accommodation entries - information received by the AO from DGIT(inv.) is tangible incriminating information coming into possession, which has live link with formation of prima facie belief that income of the assessee has escaped assessment - uphold the reopening of the assessment
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Customs:
Penalty u/s 112 of the Customs Act, 1962 - violation of the conditions of the Advance Authorisation Licence - appellant, being an employee, only accepted directorship of the two companies under instructions of his employer, and was not personally involved - penalty reduced from ₹ 25 lakh to ₹ 50,000/-
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Customs:
Revocation of CHA License - imposition of penalty - no finding of the IO against the involvement of the appellant in the offence committed by the exporter regarding the overvaluation of the export goods - Commissioner has also violated the principles of natural justice without putting the appellant to notice the reasons for his dis-agreement with the findings of the IO which according to us is the basic requirement of law - revocation set aside
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Customs:
Refund of excess customs duty - finding of the Commissioner(A) that the goods have not been cleared under protest and hence the refund application is not maintainable is clearly beyond the refund proceedings as the refund was rejected only on the ground that Notification is prospective in nature - directed to refund
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Customs:
Retention of passports without order - petitioners were carrying foreign currency unauthorizedly about $ 10,000 - only liable to pay penalty - directed to Customs Authority to hear them and decide whether the passports can be released to them and if not, shall issue an order specifically stating why it cannot be done
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Corporate Law:
Approval of the scheme of compromise/arrangement - promoter directors or some of the shareholders can move application u/s 391 of the old Act when the company is in liquidation - A scheme of compromise and arrangement can be filed even when liquidation proceeding is pending but if it would be a proceeding relating to the winding up going on and the same has to be in the same forum
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IBC:
Liquidation of Corporate Debtor u/s 33(1)(a) of the I&B Code - no Resolution Plan has been received by this Authority under sub-section (6) of Section 30 of the I&B Code, 2016, before the expiry of the maximum period of 270 days of CIR Process, the Corporate Debtor has to be ordered for Liquidation
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IBC:
Service of demand notice u/s 8 of the Code - service at corporate office - respondent had never raised the objection to the receiving or replying to the notice and at the stage of final hearing this issue raised by corporate debtor should not be considered and the matter be heard on merit - preliminary objection not being raised at the initial stage, cannot be tenable at this stage specially after completion of the pleadings - it can be served at registered office/corporate office
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Service Tax:
Whether service tax paid by the Appellant in accordance with Rule 2(1)(d)(iii) of Service Tax Rules, 1994 as recipient of ‘Insurance Auxiliary service’ and then recovered from the service providers i.e. ‘insurance agents’ is required to be deposited as per Section 73A(2) - Held No
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Service Tax:
Levy of Service Tax - hospital services to doctors - providing consulting rooms required by the panel/non-panel doctors for treating their (doctor’s) patients in the OPD. - it cannot be alleged that the hospitals are providing ‘Business Supports Services’ to the doctors.
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Service Tax:
CENVAT credit - input services - rent-a-cab service which admittedly was hired by the Appellant to provide car service to their guests - credit allowed.
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Service Tax:
Imposition of penalty - input credit of 5% retention amount - appellant had sufficient balance in cenvat account therefore it cannot be said that they had utilised the same - there was no malafide intention on its part and it was only a bonafide error, which was rectified immediately on pointing out by the audit party - no penalty is imposable on the Appellant
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Service Tax:
Utilization of CENVAT Credit - appellant, who received services from overseas service providers and discharged service tax under reverse charge mechanism, is eligible to utilize cenvat credit in discharging such service tax
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Central Excise:
CENVAT Credit - input services in the nature of the employee benefit - life insurance of employees - the need for exclusion would arise only when the services are otherwise covered by the definition.
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Central Excise:
Classification of goods - Covered yarn - The classification requires to be arrived in terms of section notes and chapter notes and the references to the respective headings or sub-headings - the impugned goods are classifiable under 5605.10
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VAT:
Writ against assessment order - Section 52 of the KVAT Act, provides for an appeal before the FAA and the petitioner can very well raise all such objections including the violation of principles of natural justice before FAA - in view of availability of an alternative efficacious remedy of appeal to the petitioner, the learned Single Judge has rightly dismissed the writ petition
Articles
Notifications
Circulars / Instructions / Orders
News
Case Laws:
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GST
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2019 (6) TMI 107
Release on Bail - Jurisdiction - power to arrest - whether without following the mandate contained in Section 74 of the Central Good and Service Tax Act, whether respondent no.4 is empowered to arrest the petitioner when the proceedings under Section 74 have not been culminated in an order and when it is not concluded? HELD THAT:- Petitioner was arrested on 21st February 2019. As of today, 57 days are over since his arrest and otherwise also, in view of the provisions of Section 167(2) of the Code of Criminal Procedure, he will be entitled to be released on default bail after completion of 60 days if the charge-sheet is not filed. The learned counsel for the respondent no.2 is not in a position to make any positive statement in this regard whether the charge-sheet would be filed in next three days. In such circumstances, we are of the opinion that the petitioner is entitled to be released on bail. The petitioner shall be released on bail in the sum of ₹ 50,000/with one surety in like amount on the condition to report to the office of respondent no.2 on every alternate day or as and when summoned for the purpose of investigation by the said authority. He would also render full assistance and cooperation in the process of investigation - application disposed off.
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2019 (6) TMI 103
Constitution of the GST Tribunal in UP - headquarter at Praygraj OR Lucknow - direction to the respondents to constitute/establish the GST Tribunal at Lucknow and further to issue necessary notifications in this regard - HELD THAT:- In sum and substance, it was admitted that initially the State Government had proposed to set up the State Bench at Lucknow with area Benches elsewhere including at Allahabad but after the order of the High Court dated 28.02.2019, a fresh proposal was sent for constitution of State Bench of the GST Tribunal at Praygraj (Allahabad) - We are required to judge the validity of the revised proposal dated 15.03.2019. Where is the Seat of the High Court of Judicature at Allahabad, is there one or more than one Seat? - HELD THAT:- There are two Seats of the High Court of Judicature at Allahabad, one at Lucknow and the other at Allahabad, none of which is permanent. From the perusal of the letter of the Commissioner, Commercial Tax, Lucknow, it is clear that there is no other material which could have created an occasion to re-consider/review its earlier proposal dated 21.02.2019 for constitution of the Bench of the Tribunal at Lucknow, and area Benches at other places including Allahabad except the order passed by the Division Bench of this court at Allahabad on 28.02.2019. The basis for the revised proposal dated 15.03.2019 is a misreading and misconstruction of the observations made in the case of Madras Bar Association [ 2014 (9) TMI 821 - SUPREME COURT ] and also misunderstanding as to the existence of two Seats of the High Court of Judicature at Allahabad, in view of the binding decision of the Supreme Court in the case of Nasiruddin [ 1975 (8) TMI 126 - SUPREME COURT ] , following the observations made in the earlier order of this Court dated 28.02.2019 passed in Writ Petition No. 655 (Tax) of 2018, therefore, the said revised proposal is not sustainable on facts and in Law. In the present case, the legislation, namely, GST Act, 2017 has been enacted and has come into force with effect from 01.07.2017. Under the said enactment, various authorities have to be set up, namely, GST Council, and the GST Council was authorised to make recommendations to the Government for constitution of the regional Benches and State Benches - the amended proposal dated 15.03.2019 sent by the Commissioner, Commercial Tax is quashed. Consequently the earlier proposal dated 21.02.2019, which was a reasoned and considered one, shall be acted upon and GST Benches shall be constituted accordingly, expeditiously, say within three months'. Petition allowed.
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2019 (6) TMI 102
Constitutional validity of Sections 67(10), 69(1), 70, 132(5) and 135 of the Central Goods and Service Tax Act, 2017 - power of arrest u/s 69(1) of the Act only after completion of the assessment - HELD THAT:- Division Bench of this Court in [ 2019 (4) TMI 1320 - TELANGANA AND ANDHRA PRADESH HIGH COURT] had dismissed the Writ Petitions holding that the prosecutions for offences under GST do not depend upon the completion of assessment and herefore, the argument that there cannot be an arrest even before adjudication or assessment, does not appeal to us These orders were challenged by the petitioners therein in Special Leave to Appeal in P.V. RAMANA REDDY VERSUS UNION OF INDIA ORS. [ 2019 (5) TMI 1528 - SUPREME COURT] before the Supreme Court and on 27.05.2019, a Bench presided over by the Hon'ble the Chief Justice of India dismissed the said Special Leave Petitions. Therefore, when the very arrest of the petitioners is not prohibited prior to the completion of the assessment, any coercive action lesser than arrest, can not also be said to be prohibited. The interim order granted on 15.05.2019 in W.P.No.10350 of 2019 is vacated. List the Writ Petitions on 03.06.2019 in ML.
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2019 (6) TMI 60
Stay on proceedings - HELD THAT:- The respondents are directed not to take any coercive action, unless a notice under Section 73(1), or Section 74(1), of the Central Goods and Service Tax Act, 2017, is issued to the petitioners and their reply is considered and disposed of, pending disposal of the writ petition. List this case on 29.05.2019 under the category of for admission .
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Income Tax
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2019 (6) TMI 101
Seizure of cash carried out by the Flying Squad - cash seized in an exercise conducted under the guidelines of the Election Commission of India - Seeking release the seized cash which was deposited in the District Treasury at Muzaffarpur but has since been transfered to the Income Tax Department - HELD THAT:- In view of the conclusion drawn by the three-men Committee constituted under the guidelines of the Election Commission of India, a copy of which is enclosed at Annexure A/9 to the counter affidavit of the Election Commission of India, in accepting the error committed in the seizure of the cash in question and concluding that the seized money had no connection with the Elections which conclusion is accompanied with the recommendation for release of cash by the Income Tax Department, any attempt made by Ms. Sinha to justify either the requisitioning of the cash in question by respondent no.6 vide his letter dated 4.4.2019 at Annexure F/9 or in taking recourse to the provisions of Section 132 or to hold on to the money is absolutely without jurisdiction and without sanction of law because the guidelines nowhere empowers either the Income Tax Department to requisition the cash seized in an exercise conducted under the guidelines of the Election Commission of India nor does guidelines provide that any cash seized in the process is to be deposited with the Income Tax Department. The seizure itself was without sanction of law and which is apparent from the fact that no F.I.R. or complaint was instituted as provided under Clause 4 of the Guidelines nor the case was submitted to the court of competent jurisdiction within 24 hours nor the Committee so constituted under the Guidelines took any decision to order seizure of the cash, in absence of any F.I.R./ complaint instituted in terms of Clause 16(i). The illegality is perpetuated because the guidelines do not empower the authorities connected with conduct of the Elections to transfer money deposited in the Treasury to the Income Tax Department on their dictates. The action of the District Treasury Officer, Muzaffarpur in succumbing to the dictates of the Income Tax Department to transfer the seized cash vide Annexure 5 to the writ petition on 11.4.2019 is dehors the guidelines and even the requisition made by respondent no.6 through his letter dated 4.4.2019 addressed to the District Magistrate, Muzaffarpur at Annexure F/9 vide order dated 11.4.2019 at Annexure 5 is wholly illegal and without sanction of law. What we find surprising is that even when the Committee constituted has accepted vide Annexure J/9 that the seizure was wrong, the Income Tax Department has proceeded to exercise jurisdiction over the cash seized as if the seizure made by the Flying Squad under the guidelines of the Election Commission of India was in fact in furtherance of exercise under section 132 of the Income Tax Act and the Flying Squad was acting as their agency. That the Committee vide its order dated 13.5.2019 has ordered for release of cash with the recommendation to the Income Tax Department to take consequential action, we hereby direct respondents no. 6 to 8 or the authority found responsible more particularly respondent no.6 under whose requisitional order the money was transferred to the Income Tax Department to forthwith take steps for release of the cash in favour of the proprietor of the petitioner within a maximum period of eight weeks of receipt/ production of a copy of this judgment, failing which the petitioner would be entitled to interest @ 10% on the seized cash payable by the Income Tax Department from the date the seizure took place i.e. 27.3.2019 until the money is refunded by the Income Tax Department. Be it noted that we have expressed no opinion on the exercise initiated by the Income Tax Department in purported exercise under section 131 and 132A of the Act and they are at liberty to take it to its logical conclusion.
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2019 (6) TMI 100
Penalty u/s. 271(1)(c) - Non specification of charge - defective notice - HELD THAT:- Following the decision of Coordinate Bench of this Tribunal in the case of Jeetmal Choraria Vs. ACIT [ 2017 (12) TMI 883 - ITAT, KOLKATA] where it is held that the show cause notice issued u/s 274 does not specify the charge against the assessee as to whether it is for concealing particulars of income or furnishing inaccurate particulars of income - the show cause notice u/s 274 does not strike out the inappropriate words - thus in these circumstances, we are of the view that imposition of penalty cannot be sustained - Decided in favor of assessee.
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2019 (6) TMI 99
Penalty u/s 271(1)(c) - assessee s quantum appeal has since been restored by a Coordinate Bench of this Tribunal - HELD THAT:- In our considered opinion that it will be in the fitness of things if the penalty appeal is also restored to the file of the Assessing Officer. Accordingly, we restore this appeal to the file of the Assessing Officer with the liberty to initiate penalty proceedings afresh, if it is so warranted, once the quantum has been decided afresh. Appeal of the assessee stands allowed for statistical purposes.
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2019 (6) TMI 98
Surrender of income - Voluntary disclosure - survey proceedings u/s 133A - assessee had failed to establish that the increase in gross receipts - contention of the Ld. AR that the surrendered amount is subsumed in the gross receipts - HELD THAT:- There is an increase in the depreciation charge to the tune of ₹ 12,73,417/- in the year under consideration as compared to the immediately preceding assessment year. Similarly, the salary to partners rose from ₹ 20,00,960/- in AY 2009-10 to ₹ 30,68,370/- in the year under consideration thus resulting in an increase of ₹ 10,67,410/- as compared to the immediately preceding year. Similarly, there is an increase in the interest to the partners in the year under consideration to the tune of ₹ 3,25,173/- as compared to the immediately preceding assessment year. These figures are undisputed and have also been recorded in the impugned order. It is also an accepted fact that the gross receipts have jumped from ₹ 33,122,988/- in AY 2009-10 to ₹ 43,581,430/- in the year under consideration thus showing a substantial increase of ₹ 10,458,442/- as compared to the immediately preceding assessment year. On such facts, we are of the considered opinion that the contention of the AR that the surrendered amount is subsumed in the gross receipts is to be agreed to. The fall in the net profit is also duly explained by the increase in depreciation, salary and interest to partners which works out to ₹ 26,66,000/-. Therefore, we are unable to concur with the findings of the lower authorities and we set aside the order of the Ld. CIT (A) and direct the AO to delete the addition. - Decided in favour of assessee
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2019 (6) TMI 97
Long term capital gain - assessee has filed suit for declaring the impugned sale as null and void - transfer has taken place or not - HELD THAT:- Although the sale deed states that the sale consideration has been paid to the assessee, it is the assessee s contention that the cheques have been dishonoured and that the cash component of the sale consideration has also not been received. Sale deed mentions that the seller i.e. the assessee has received the sale consideration prior to the execution of the sale deed. It is further noted that the sale deed also mentions that the sale deed will be deemed to have been cancelled in the event of the cheques being dishonoured. All these facts would necessarily have to be examined by the AO before the impugned proceeds can be brought to tax. During the course of hearing, AR also could not apprise the Bench on the outcome of the civil suit which had been filed by the assessee for declaring the sale as non-est. Accordingly, it will be in the fitness of things if the AO re-examines the issue after duly considering whatever evidence the assessee may deem appropriate to file before the AO in support of his claim and thereafter pass the assessment order as per law. AO will afford proper opportunity to the assessee to present his case and the assessee will also fully cooperate in the assessment proceedings in this regard whenever he is called upon to do so failing which the AO shall be at liberty to proceed ex parte qua the assessee in accordance with law. Accordingly, in light of our above observations, we restore the entire appeal to the file of the Assessing Officer. The appeal stands allowed for statistical purposes.
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2019 (6) TMI 96
Penalty u/s 271B - failure of the assessee to file the audit report before the due date of filing the return u/s 139(1) i.e. 30th September, 2012 - violation of provisions of section 44AB - HELD THAT:- Since the assessee has filed the return of income on 29th March, 2014, therefore, the AO considered this late filing of the return along with the audit report as violation of provisions of section 44AB and consequently the AO levied the penalty u/s 271B. AO has not levied the penalty for not filing of the audit report along with the return of income filed by the assessee on 29th March, 2014 but the AO has levied the penalty due to the delay in filing the audit report as it was filed along with the return of income on 29th March, 2014. Further, the rule 12(2) even if it is considered to be applied as on the date of filing the return, the relevant date is the due date of filing the return u/s 139(1). Hence when the assessee has already filed the audit report on 29.03.2014 and as per the return of income the audit report was already obtained and read on 2nd September, 2012, then in the facts and circumstances of the case prior to the return of income filed by the assessee there was no occasion for the assessee to file the audit report separately. The amended provisions of rule 12(2) came into effect from 01.04.2013 whereas the due date of filing the return under section 139(1) is 30th September, 2012 and hence when the amended rule was not applicable as on 30th September, 2012, the assessee has made out the clear case of reasonable cause for not complying with the provisions of section 44AB and consequently the case of the assessee clearly falls under the provisions of section 273B. Accordingly, as relying on KK. SPUN PIPE. [ 2005 (4) TMI 28 - PUNJAB AND HARYANA HIGH COURT] the penalty levied under section 271B is not sustainable - Decided in favour of assessee.
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2019 (6) TMI 95
Revision u/s 263 by CIT - PCIT was of the view that the product manufactured by the assessee was not eligible for deduction u/s 80IC - whether the product manufactured by the assessee i.e. Dissolved Acetylene Gas falls in negative list of Schedule XIII of the I.T. Act, hence, not eligible to claim deduction u/s 80IC of the Act. - HELD THAT:- The product manufactured by the assessee as per the activity and product classification given by Statistics Databank Division, Ministry of Micro, Small Medium Enterprises, Government of India bears code 24119 and, hence, the same does not fall in the negative list. However, the assessee has not addressed any arguments about the remaining points on account of which also Ld. PCIT held that the order of the Assessing officer was erroneous and prejudicial to the interest of Revenue. The Ld. Counsel though orally submitted that the Ld. PCIT did not find any error in respect of point d raised by him in the impugned order. May it be so, the Ld. Counsel for the assessee has not addressed any arguments regarding point b , point c and point e before us. We have been conveyed that even in the set aside proceedings, the assessee could not convince the Assessing officer apart from point a , regarding point b and point c also as mentioned in the impugned order of the PCIT. From the above discussion what emerges is that there were certain errors in the order of the Assessing officer passed u/s 143(3) of the Act and because of those errors, the income of the assessee has escaped assessment. Hence, the said order being erroneous was also prejudicial to the interest of Revenue. Though the assessee has arguable points regarding point a raised in the impugned order of the PCIT, however, the facts establish on the file that the assessee could not rebut the findings of the Ld. PCIT in respect of points b and c which proves that the order of the Assessing officer was erroneous and prejudicial to the interest of Revenue as the Assessing officer had failed to make any proper required enquires to frame the assessment. In view of this, we do not find any reason to interfere in the order of the Ld. PCIT in setting aside the assessment order passed u/s 143(3) of the Act. - Decided against assessee.
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2019 (6) TMI 94
Disallowance u/s 14A r.w.r. 8D - expenditure incurred for earning of tax exempt income - HELD THAT:- No disallowance is attracted u/s 14A in case the assessee has not earned any income not forming part of the total income. Since the assessee did not earn any tax exempt income, hence, no disallowance u/s 14A is attracted. See WINSOME TEXTILE INDUSTRIES LTD. [ 2009 (8) TMI 220 - PUNJAB AND HARYANA HIGH COURT] ,CHEMINVEST LIMITED [ 2015 (9) TMI 238 - DELHI HIGH COURT] , CORRTECH ENERGY PVT. LTD. [ 2014 (3) TMI 856 - GUJARAT HIGH COURT] So far as the contention of DR that the assessee himself had agreed during the assessment proceedings when called for by the Assessing officer for making the aforesaid disallowance u/s 14A of the Act is concerned, we are not convinced with the above submissions of the Ld. DR. If the assessee under the mistaken belief had agreed to the aforesaid disallowance, that itself, does not debar the assessee to agitate the said disallowance in an appeal if the assessee otherwise legally is not liable to pay any tax on such disallowance / addition made by the Assessing officer. In view of this, the Assessing officer is ordered to delete the disallowance so made u/s 14A - Decided in favour of assessee.
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2019 (6) TMI 93
Reopening of assessment u/s 147 - reopening based on opinion given by DCIT and not by DVO - live link between incriminating tangible information received by the AO and formation of belief that income of the assessee has escaped assessment - Bogus purchases - HELD THAT:- In the instant case before us, It is based on admission of key persons of searched persons that their group were indulging in providing bogus accommodation entries by way of sales and unsecured loans wherein name of the assessee also found mentioned in the list of beneficiaries of the said accommodation entries being compiled by Revenue during search operations u/s 132, the AO reopened the concluded assessment u/s 147 and as held that this information received by the AO from DGIT(inv.), Mumbai and DCIT, Surat to be tangible incriminating information coming into possession of the AO which has live link with formation of prima facie belief that income of the assessee has escaped assessment. AO received information from DDIT(Inv.), Mumbai and DCIT, Surat and not from DVO, which we have already held was a tangible incriminating information having live link with formation of belief that income of the assessee has escaped assessment to invoke provisions of Section 147 in the instant appeal before us. We uphold the reopening of the assessment by the AO u/s 147 in the instant case before us and decide ground number 1 raised by assessee in memo of appeal filed with tribunal against assessee Bogus purchases - HELD THAT:- We are unable to impress ourselves with this feeble argument advanced by the assessee, firstly that was addition made by AO on account of shortage/excess of stock and it was for the assessee to show with cogent evidences/explanation that this item of stock bought from M/s Mani Prabha Impex Private Limited was infact added in its entirety to income as shortages of stock by the AO and now making further additions will lead to double additions of the same income and secondly, this tangible incriminating information of the assessee indulging in obtaining bogus accoomodation bills was received by AO after completion of the assessment by the AO for AY 2012-13 u/s 143(3) on 30.03.2014. Under these facts and circumstances of the case, in our considered view keeping in view factual matrix of the case, the profit embedded in these purchases are required to be brought to tax which requires estimation of income as held by Hon ble Supreme Court in the case of Kachwala Gems v. JCIT [ 2006 (12) TMI 83 - SUPREME COURT] In our considered view keeping in view factual matrix of the case, estimation of additional income @ 10% of the alleged bogus purchases to the tune of ₹ 8,33,985/- made from said M/s Mani Prabha Impex Private Limited will meet end of justice. The AO had itself estimated additions to income @10.33% of alleged bogus purchases in immediately succeeding assessment year viz. AY 2012-13. Thus, we estimate the additional income over and above what was declared in the return of income filed with the revenue being profit embedded in these alleged bogus purchased from M/s Mani Prabha Impex Private Limited @ 10% of the alleged bogus purchases. - Decided partly in favour of assessee
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2019 (6) TMI 92
Penalty u/s 271(1)(c) - non deduction of tds - disallowance u/s 40(a)(ia) - bona fide mistake - furnishing inaccurate particulars of income - HELD THAT:- From the assessment order itself it is evident that the AO came to know about the non deduction of tax at source on the payment from the tax audit report. The explanation of the assessee for non deduction of tax at source is, due to oversight the assessee could not add back the amount disallowed u/s 40(a)(ia) in the computation of income. In our view, the aforesaid explanation of the assessee appears to be plausible considering the fact that disallowance of the aforesaid amount was suggested by the tax auditor in the audit report. Since the assessee had furnished full particulars about the expenditure incurred including the fact of non deduction of tax at source in the tax audit report itself, it cannot be accused of furnishing inaccurate particulars of income. Therefore, contention of the learned Authorised Representative that failure to disallow the amount u/s 40(a)(ia) was due to a bona fide mistake is acceptable. Therefore, by applying the ratio laid down in Price waterhouse Coopers Pvt. Ltd. [ 2012 (9) TMI 775 - SUPREME COURT] we delete the penalty imposed - Decided in favour of assessee.
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2019 (6) TMI 91
Condonation of delay - Failure to explain delay in filing this appeal late by 364 days beyond time stipulated u/s 253(3) with sufficient cause - Disallowance of bad debts, Legal Financial Charges and Depreciation claimed - best judgment assessment - ex-parte order by Tribunal - HELD THAT:- The notice which was sent to the assessee by tribunal on 14.02.2019 vide registered A.D. to the registered address has returned un-served with remark left premises‟. The said envelop is placed in file. The assessee has not furnished new address with the Registry of the tribunal as is required under Rule 9A of the Income-Tax (Appellate Tribunal) Rules, 1963, as no revised form No. 36 has been filed by the assessee. Thus, we have observed that the assessee is consistently adopting a casual approach in dealing with the appeal filed with the tribunal. The litigant has to be vigilant to its rights and duties under law. There has to be a plausible and sufficient cause for seeking condonation of delay in filing appeal late beyond time prescribed under statute, which we found lacking in this appeal as the assessee could not explain substantial delay of 364 days in filing this appeal late. The delay in filing appeal in instant case is as much 364 days which by no standards is a small delay and since assessee had failed to explain delay in filing this appeal late by 364 days beyond time stipulated u/s 253(3) with sufficient cause, we dismiss the condonation of delay application filed by the assessee. Even on merits we have observed that the assessee has with respect to all the three claims of deduction of expenditure which stood disallowed by the AO and added to income vide best judgment assessment which later stood confirmed by learned CIT(A), had not filed any details and justifications with respect to these claim of deduction of expenditure with respect to all the three issues before AO as well as before Ld. CIT(A). Even before us none appeared on behalf of the assessee when the appeal was called for hearing and no details as well justifications of claiming these expenses as deduction for computing income of the assessee for impugned assessment year are filed. The assessee has also not filed paper book containing evidences with tribunal to justify its claim of deduction of aforesaid expenses. Under these circumstances there is no reason and justification for us to interfere with well reasoned appellate order passed by Ld. CIT(A) as there is a failure on the part of the assessee to give details and justification for its claim of deduction with respect to all the issues - decided against assessee
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2019 (6) TMI 90
Disallowance u/s 14A r/w rule 8D - assessee sought adjournment on two occasions and did not appear the third time when the appeal was fixed for hearing - ex parte disposal of the appeal by the CIT(A) - HELD THAT:- The assessee deserves an opportunity to explain its case relating to disallowance mad under section 14A r/w rule 8D before CIT(A). Accordingly, we set aside the impugned order of CIT(A) and restore the issue relating to the disallowance made under section 14A r/w rule 8D for de novo adjudication by the learned CIT(A) after providing due opportunity of being heard to the assessee. We direct the assessee to appear before CIT(A) and represent its case in an effective manner with supporting evidences and co operate in finalization of appeal proceedings. With the aforesaid observations, grounds are allowed for statistical purposes.
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2019 (6) TMI 89
Penalty u/s 271(1)(c) - change of head of income - assessee submitted that the issues relating to various additions on the basis of which penalty u/s 271(1)(c) was imposed, in the meanwhile, have been restored back to the Assessing Officer by the Tribunal while deciding assessee s quantum appeal [ 2017 (4) TMI 1444 - ITAT MUMBAI] - HELD THAT:- Tribunal while deciding the quantum appeal of the assessee in the order referred to above restored all the issues to the AO for fresh adjudication. In the assessment order passed in pursuance to the directions of the Tribunal, the Assessing Officer has accepted some of the claim of the assessee and decided a couple of issues against the assessee. As could be seen from the fresh assessment order, the Assessing Officer had not initiated any proceeding for imposition of penalty u/s 271(1)(c). Be that as it may, once the additions / disallowances on the basis of which penalty u/s 271(1)(c) lost its existence due to the order passed by the Tribunal in quantum appeal filed by the assessee, penalty u/s 271(1)(c) cannot survive. In view of the aforesaid, we are inclined to delete the penalty imposed u/s 271(1)(c) - Decided in favour of assessee
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2019 (6) TMI 88
Disallowance made u/s 14A r/w rule 8D, while computing the income under the normal provisions as well as u/s 115JB - HELD THAT:- The disallowance u/s 14A r/w rule 8D cannot exceed the quantum of exempt income earned during the year. No reason to interfere with the decision of CIT(A) in directing the AO to restrict the disallowance u/s 14A to the disallowance made by the assessee. Disallowance made while computing the book profit u/s 115JB - AO has made such disallowance by resorting to the provisions of section 14A r/w rule 8D - HELD THAT:- As per the ratio laid down by the Tribunal, Special Bench Delhi, in Vireet Investment [ 2017 (6) TMI 1124 - ITAT DELHI] AO while computing the book profit u/s 115JB cannot make any disallowance by making reference to the provisions of section 14A r/w rule 8D . AO retains the power to make disallowance of expenditure incurred for earning exempt income as per Explanation 1(f) of section 115JB of the Act. Therefore, the disallowance made by AO while computing book profit u/s 115JB(2) is unsustainable. Thus, AO is directed to examine and quantify the expenditure incurred by the assessee for earning exempt income in terms of Explanation 1(f) of section 115JB of the Act without taking aid of rule 8D(2) r/w section 14A. Grounds no. (i) and (ii) are dismissed and ground no. (iii) is partly allowed for statistical purposes.
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2019 (6) TMI 87
Penalty u/s 271(1)(c) - adhoc disallowance of expenses - Part disallowance of expenditure - HELD THAT:- There cannot be any doubt about the genuineness of expenditure claimed as the Assessing Officer himself has allowed 75% of the total expenditure claimed. The disallowance of 25% is purely on ad hoc / estimate basis on the allegation that such expenditures are not fully verifiable. There is nothing on record to suggest that the assessee did not furnish full particulars of expenditure claimed or there was any act of omission or commission on the part of the assessee in furnishing the particulars of expenditures. Part disallowance of expenditure claimed is purely on estimate basis. In the aforesaid circumstances, the assessee cannot be accused of furnishing inaccurate particulars of income. More so, when the first appellate authority being convinced with the submissions of the assessee had deleted the disallowance, though of course, such disallowance was restored by the Tribunal. We are inclined to delete the penalty imposed u/s 271(1)(c) - Decided in favour of assessee
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2019 (6) TMI 86
Rectification u/s 254 - Deduction u/s 80P(2)(a)(i) allowability - as per AO that the assessee is a Co-operative Bank in the category of primary co-operative bank and is hit by provisions of Section 80P(4) - assessee claimed that it provides credit facilities to its members only and hence it is entitled for deduction u/s 80P(2)(a)(i) - CIT-A decided the issue in favour of the assessee - tribunal based on material which is available on record the assessee is not a Co-operative Bank but a Co-operative credit society and also noticed that there are two types of members which the assessee can make as per bye laws firstly active members and second nominal members. The active members can give deposit , take loans and also are entitled to vote at the meetings but there is another class of members namely nominal members who are retired employees of Tata Memorial Hospital who cannot give deposits to assessee, nor take loans from assessee as well these nominal members are not entitled to vote at the meetings - assessee is now seeking recall of the said well reasoned order dated 31.07.2018 passed by tribunal on the grounds that there was no dispute between the Revenue and the assessee as to the nominal members and also it is made out that facts in the case of Citizen Co-operative Society Limited [ 2017 (8) TMI 536 - SUPREME COURT] were different HELD THAT:- The scope available with tribunal u/s 254(2) is limited to correcting mistakes apparent from records and we do not find any mistake apparent from records in well reasoned order [ 2018 (8) TMI 129 - ITAT MUMBAI] passed by tribunal in view of recent decision of Hon ble Supreme Court in the case of The Citizen Co-operative(supra), as in case of the assessee there is also an class of nominal members who are not entitled to give deposits, take loans or even they are not allowed to vote in meetings but they are only allowed to place their retirement benefits. Thus, we find there is no mistake apparent from records in the appellate order dated 31.07.2018 passed by tribunal which can be rectified within limited mandate of Section 254(2). At this stage we would also like to refer to recent decision in the case of The Mavilayi Service Co-operative Bank Limited v. CIT [ 2019 (3) TMI 1580 - KERALA HIGH COURT] . Thus, in our considered view this MA lacks merit and we are inclined to dismiss this MA. We order accordingly.
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2019 (6) TMI 85
Addition u/s 69 - unexplained investment - investment not recorded in the books of account - Assessee had received advances from the seven parties against the sale of the proposed developed property - HELD THAT:- During the course of appellate proceedings, the assessee came up with his explanation that the advances were received by him from seven parties against sale of property and the same were utilized for giving loan to M/s. Winner Garments Pvt. Limited. Although this explanation of the assessee was supported by documentary evidence in the form of sale agreement, there were various discrepancies and anomalies in the claim of the assessee as found by the Assessing Officer during the course of remand proceedings and as specifically recorded by the ld. CIT(Appeals) in his impugned order. During the course of remand proceedings, only four of the seven parties appeared before the Assessing Officer for examination/verification and as found by the Assessing Officer, they were not having capacity or creditworthiness to give the advances to the assessee in cash as claimed. It is observed that specific adverse findings/observations were recorded by the Assessing Officer in the remand report as well as by the ld. CIT(Appeals) in his impugned order to doubt or dispute the claim made by the assessee of having received the advances in question in cash from the concerned seven parties. At the time of hearing before us, the ld. Counsel for the assessee has not been able to bring anything on record to rebut or controvert these adverse findings recorded by the Assessing Officer as well as by the ld. CIT(Appeals). He has only harped on the documentary evidence filed by the assessee in the form of sale agreements and the confirmations of the four creditors as made before the Assessing Officer during the course of remand proceedings. In the present case, investment in the form of loan given to M/s. Winner Garments Pvt. Limited was found to be made by the assessee in the financial year immediately preceding the assessment year under consideration and since the said investment was not recorded in the books of account of the assessee and the explanation offered by him about the nature and source of the said investment was not found to be satisfactory, the addition made by the AO u/s 69 was fully justified and there is no infirmity in the impugned order of the CIT(Appeals) in confirming the same. - Decided against assessee.
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2019 (6) TMI 84
Disallowance of written off depreciated investments - assessment of an assessee carrying on general insurance business - HELD THAT:- As decided in assessee's own case [ 2016 (8) TMI 326 - ITAT KOLKATA] because of the restrictions contained in section 44 read with Rule 5 of the First Schedule, there could not be any disallowance of the amount written off out of investments and, accordingly, the disallowance is deleted - Decided in favour of assessee Addition on account of amortization of premium paid on investments - HELD THAT:- As decided in assessee's own case [ 2016 (8) TMI 326 - ITAT KOLKATA] the particular item of dispute (debit entry made in the profit and loss account) falls under the category of expenditure or allowance or provision and the same is not admissible under the Act, only then the concerned item can be added back in computing the income from general insurance business. The disallowance of amortised premium paid on investments made by the ld AO is not in accordance with the prescribed specific procedure in the assessee s case. CIT-A duly appreciated the contentions of the assessee deleted the dis allowance correctly. SEE case of General Insurance Corporation of India vs CIT 1999 (9) TMI 3 - SUPREME COURT] and CIT vs Oriental Fire General Insurance Co Ltd [ 2007 (5) TMI 193 - SUPREME COURT] - Decided in favour of assessee. Disallowance u/s 14A r.w.s. 8D - HELD THAT:- ld. CIT(Appeals) by relying, inter alia, on the decision of the Tribunal in the case of REI Agro Limited vs.- DCIT [ 2013 (9) TMI 156 - ITAT KOLKATA] has directed the AO to re-compute the disallowance by taking into consideration the value of only those shares, which had yielded dividend income to the assessee during the year under consideration. Since the decision of the Tribunal in the case of REI Agro Limited [ 2013 (9) TMI 156 - ITAT KOLKATA] has been upheld by the Hon ble Calcutta High Court and three is no other decision of the Hon ble Jurisdictional High Court or the Hon ble Supreme Court cited by the ld. D.R. taking a contrary view, we uphold the impugned order of the ld. CIT(Appeals) giving relief to the assessee. Addition towards Reserve created for Unexpired risk u/s 115JB - HELD THAT:- As the issue involved in the year under consideration as well as all the material facts relevant thereto are similar to that of A.Ys 2005-06, 2007 08 and 2008-09, we respectfully follow the order of the Tribunal for the said years and uphold the impugned order of the ld. CIT(Appeals) giving relief to the assessee on this issue AS dealt this issue very elaborately and had given proper finding that the reserve created for unexpired risk need not be added back for the purpose of computation of book profits u/s 115JB. The revenue was not able to controvert the findings of the ld CITA before us. Hence we find no infirmity in the order passed by the ld CITA in this regard - Decided against revenue Disallowance u/s 14A while computing the book profit u/s 115JB - CIT(Appeals) deleted the said addition relying, on the decision of M/s. Philips Electronics India Limited vs.- DCIT [ 2016 (3) TMI 1056 - ITAT KOLKATA] - HELD THAT:- . Since this view taken by the Division Bench of the Tribunal has been affirmed by the Special Bench of the Tribunal in the case of VIREET INVESTMENT (P.) LTD [ 2017 (6) TMI 1124 - ITAT DELHI] holding that artificial disallowance u/s 14A as worked out by applying Rule 8D cannot be added while computing the book profit u/s 115JB of the Act and it is only the actual expenditure incurred by the assessee in relation to the exempt income, which is debited to the profit loss account, can be added. Keeping in view the said decision of the Special Bench of this Tribunal, we find no infirmity in the impugned order of the ld. CIT(Appeals) deleting the disallowance - Decided against revenue
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2019 (6) TMI 83
Treatment to loss from derivative transactions in Commodity Futures and Options as speculative loss - set off of loss arising from derivative transactions in commodity future and options against business income - transactions were done through recognized stock exchange hence section 73(1) was not applicable - CBDT, on 22nd May 2009, recognizing MCX as recognized Stock Exchange for the purpose of section 43(5) - HELD THAT:- Similar issue has been decided in favour of the assessee by the Mumbai Bench of this Tribunal in the case of ACIT vs.- Arnov Akshay Mehta [ 2012 (9) TMI 447 - ITAT MUMBAI] wherein held the transactions carried out through MCX Stock Exchange after 1st April 2006, would be eligible for being treated as non-speculation within the meaning of clause (d) of proviso to section 43(5). Recognition by the Central Govt. of the Stock Exchange from a later date will not debar the transaction as non-speculation, especially after 1st April 2006. Therefore, in our opinion, the assessee's derivative trading through MCX Stock Exchange in the assessment year 2007-08 is non-speculation transaction and, therefore, the loss incurred in such transactions is to be treated as normal business loss. Thus direct the AO to allow the claim of the assessee for set off of loss in question incurred by the assessee in Commodity Futures and Options against profit from non-speculation business as claimed. - Decided in favour of assessee.
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2019 (6) TMI 82
Penalty u/s 271(1)(c) - deletion of quantum addition by the Hon ble ITAT [ 2018 (4) TMI 1710 - ITAT JAIPUR] ] - HELD THAT:- The revenue has not disputed the fact that the addition made by the AO has been deleted by this Tribunal in the quantum appeal as referred by the CIT (A) in the impugned order. However, the revenue has challenged the order of the CIT (A) cancelling the penalty levied under section 271(1)(c) only on the ground that the order of this Tribunal in quantum appeal has not been accepted by the revenue. The revenue has not produced any record or even claimed that the said order of the Tribunal in quantum appeal has been reversed by the Hon ble High Court. Accordingly, in the facts and circumstances of the case, when the addition itself is not in existence then the penalty levied under section 271(1)(c) has no legs to stand. - Decided in favour of assessee
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2019 (6) TMI 59
Stay of demand - HELD THAT:- Issue notice to the respondent, returnable on 14.05.2019.The Registrar of the Delhi Bench of the ITAT shall ensure that the files containing all the relevant orders of the proceedings including the order sheets (listed before Delhi Bench B ) are kept in a sealed cover and transmitted to this court two days before the next date of hearing. The notice accompanied by a copy of this order shall be separately issued without process fee and transmitted to the Registrar of the ITAT to ensure compliance.
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Customs
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2019 (6) TMI 106
Import of gold - allegation of smuggling of gold - release of goods - stand of the respondents is that the respondents prefer detailed examination of subject containers particularly in the presence of a person authorized by the petitioner - HELD THAT:- MR. Abin M. Sajan now who is treated as the authorized representative of petitioner along with his proof of identity and copy of this order appears before the respondent within two days from today. The respondent on such presentation by the authorized representative stipulates a day for appearance of that person for conducting detailed examination and completes the entire exercise within two weeks from the date of presentation by the authorized representative. The Senior Standing Counsel is given liberty to communicate this order forthwith to the respondent.
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2019 (6) TMI 105
Principles of natural justice - challenges the look-out - according to respondents, they are compelled to take recourse to this inconvenient extreme step against the petitioner, for the petitioner is either acting too intelligent or with tactical reasons not co-operate with the investigation into offences investigated by the Department - HELD THAT:- As a matter of fact, it is stated by the learned counsel for the petitioner that the petitioner pursuant to a notice recently issued by the respondents is appearing before the authorities in the inquiry scheduled to be held today and would co-operate with the respondents and the look out circular impugned in the writ petition ought to be recalled. Keeping in view the totality of circumstances and particularly the stand taken by the respondents in the counter affidavit, this Court directs the first respondent to consider the necessity of continuing the look-out notice or not and if the respondents are satisfied with the co-operation extended by the petitioner, pass orders and communicate the decision so taken within two weeks from today, to the petitioner. Petition disposed off.
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2019 (6) TMI 81
Retention of passports without order - petitioners were carrying foreign currency unauthorizedly about $ 10,000 - only liable to pay penalty - whether the retention of the passports by respondents 1 and 2 is legal or otherwise, can be entered into by the said Authority? - HELD THAT:- The petitioners are directed to mark appearance at 11 a.m on 24/05/2019 in the Office of the 2nd respondent-Superintendent of Customs, Cochin International Airport; in which event, the said Authority will hear them and decide whether the passports can be released to them and if not, shall issue an order specifically stating why it cannot be done. It is clarified that the 2nd respondent must take a decision as afore on 24/05/2019 itself and he will either release the passports to the petitioners or issue the order refusing to do so, on the same day itself, before the close of the working hours, so as to enable the petitioners to take further re-course, available to them in law, without any delay. Petition disposed off.
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2019 (6) TMI 80
Refund of excess customs duty - excess customs duty paid on account of imposition of 1% handling charges by the Customs authorities at the time of import of goods - the original authority rejected the refund claim mainly on the ground that the duty was paid by way of duty scrips which is not entitled to cash refund and secondly Notification 91/2017 dated 26.09.2017 is retrospective in nature. HELD THAT:- The appellant filed a refund claim of excess payment of Customs duty on the basis of law declared by the Supreme Court in the case of WIPRO LTD. VERSUS ASSISTANT COLLECTOR OF CUSTOMS OTHERS [ 2015 (4) TMI 643 - SUPREME COURT] wherein it was held that imposition of customs duty on adhoc 1% handling charges is bad in law. Further after the decision of the Supreme Court the Revenue issued a Notification 91/2017-Cus. dated 26.09.2017 amending the law on valuation imposing the adhoc handling charges. Further the CBEC vide Circular No. 39/2017 dated 26.09.2017 has clarified that the amendment to the Valuation Rules will be from retrospective effect. The Commissioner s (Appeals) directions to examine the claim of unjust enrichment when the matter has already been examined and decided in favour of the appellant and the Revenue is not under appeal on this aspect of the Order-in-Original is not tenable in law. The Commissioner of Customs (Appeals) cannot in its appellate jurisdiction review the order of the refund authority which is not in dispute and has attained finality - Further the finding of the Commissioner (Appeals) that the goods have not been cleared under protest and hence the refund application is not maintainable is clearly beyond the refund proceedings as the refund sanctioning authority has rejected the refund application only on the ground that Notification is prospective in nature. Moreover, the Commissioner (Appeals) failed to appreciate that Section 27 does not require that the goods should be cleared under protest for claiming refund of excess payment of duty. The matter is remanded to the original authority only for the purpose of verification of the documents and sanctioning of the refund - appeal allowed by way of remand.
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2019 (6) TMI 79
Revocation of CHA License - forfeiture of security deposit - imposition of penalty - prohibition on the appellant to operate at the Kandla Port as a customs broker - HELD THAT:- While lifting the Prohibition Order, the Commissioner observed that the lifting of the Prohibition Order is subject to further outcome of proceedings initiated by the Commissioner of Customs, Bangalore. Further, in the meantime, the Commissioner of Customs, Bangalore on the basis of said Prohibition Order issued the SCN to the appellant alleging violation of various Regulations as prescribed in CBLR, 2018 and appointed the Inquiry Officer. We also find that the said Inquiry Officer after conducting of detailed inquiry and examining the documents produced by the appellant as well as the exporter has exonerated the appellant by holding that they have not violated any of the Regulations 11 (a) (d) (e) (f) (n) of CBLR, 2013. The only fault found by the Inquiry Officer against the appellant was lack of supervision towards the work carried out by the person employed by him who was a trainee officer. Further, there is no finding of the Inquiry Officer against the involvement of the appellant in the offence committed by the exporter regarding the overvaluation of the export goods. In view of the finding of the Inquiry Officer, it was not required to pass the impugned order by the Commissioner of Customs. Further, the Commissioner has also violated the principles of natural justice without putting the appellant to notice the reasons for his dis-agreement with the findings of the Inquiry Officer which according to us is the basic requirement of law - Further, in various decisions this Courts have consistently held that the extreme penalty of revocation should be invoked only when there is a clear involvement of the appellant in mis-declaring the value of the goods in order to avail pecuniary benefits. Appeal allowed - decided in favor of appellant.
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2019 (6) TMI 78
Penalty u/s 112 of the Customs Act, 1962 - Directorship in two companies simultaneously - diversion of PVC-resins - HELD THAT:- The present appellant resigned from directorship of both the companies in April-June, 2004, on coming to know of the nefarious activity and intention of Mr. Vinod Kumar Bansal. Further, the Addl. DGFT, New Delhi have in appellate orders, mentioned hereinabove, ordered deletion of name of this appellant from the adjudication orders, with respect to the disputed Advances Authorisation Licenses . Further, the adjudicating authority have not found complicity on the part of the present appellant. Rather it is the finding that Mr. Vinod Kumar Bansal in collusion with Mr. Vinod Kumar Garg of Veekay Poly Coats Ltd., imported and diverted the PVC-resins, in violation of the conditions of the Advance Authorisation Licence. This appellant, being an employee, only accepted directorship of the two companies under instructions of his employer, and was not personally involved. The penalty under Section 112 is reduced to ₹ 50,000/- - appeal allowed in part.
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Corporate Laws
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2019 (6) TMI 77
Approval of the scheme of compromise/arrangement - Sections 391/394 read with Sections 80, 81, 100 and 103 of The Companies Act, 1956 - whether or not the promoter directors or some of the shareholders of a company in liquidation can file an application under Section 391(1) of the Companies Act, 1956/Section 230(1) of the Companies Act, 2013 seeking arrangement as sought in this application? HELD THAT:- Liquidator is only an additional person and not exclusive person who can move application under Section 391 of the old Act when the company is in liquidation. Looking to these Judgements, we are unable to support the view taken by NCLT that the Appellant could not have filed the Petition under Section 391 of the old Act. In the present matter, the Appellant had filed the proceedings before Hon ble Company Court but it appears to have got transferred to NCLT by an Office letter dated 7th January, 2017 (Page 77). It does not appear that there was any Judicial Order to transfer. The Appellant cannot be held responsible for the transfer. However, now when the issue appears to be going to the root of jurisdiction, although we propose to remand back the matter to the NCLT, it appears to us that the present proceedings in NCLT should remain stayed giving opportunity to the Appellant to move the Hon ble High Court to ensure that Scheme filed in Liquidation/winding up proceeding and Liquidation/winding up proceeding should be before same forum. A scheme of compromise and arrangement can be filed even when liquidation proceeding is pending but if such application/petition is filed, it would be a proceeding relating to the winding up going on and the same has to be in the same forum. The Impugned Order of NCLT is set aside and TCSP 1 of 2017 restored on the file of the National Company Law Tribunal, Mumbai Bench with a further direction that the NCLT will give one opportunity to the Appellant to move the Hon ble High Court of Bombay Company Court to ensure that the Scheme and Liquidation/winding up proceedings are before one and same forum. Interim Order dated 01.10.2018 passed in this appeal at the stage of admission shall stand lapsed.
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Insolvency & Bankruptcy
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2019 (6) TMI 76
Service of demand notice u/s 8 of the Code - registered office OR corporate office - Section 8(1) of the Code and Rule 5 of the Insolvency and Bankruptcy (Application to the Adjudicating Authority) Rules, on conjoint reading makes it categorically clear that the service of demand notice is mandatorily to be served at the registered office of the corporate debtor - corporate debtor has received the demand notice sent under section 8 of the Code at the corporate office without any objection or opposition or any remark - HELD THAT:- Till the filing of the present application the respondent had never raised the objection to the receiving or replying to the said notice u/s 8 and at the stage of final hearing this issue raised by corporate debtor should not be considered and the matter be heard on merit - Thus, preliminary objection not being raised at the initial stage, cannot be tenable at this stage specially after completion of the pleadings. In view of the present latest judgment of the Hon'ble NCLAT in NCLAT in ALLOYSMIN INDUSTRIES VERSUS RAMAN CASTING PRIVATE LIMITED, DELHI [ 2019 (3) TMI 194 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI] which is binding on NCLT, it leaves no doubt that demand notice under section 8 of the Code can be served at registered office/corporate office. Application dismissed.
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2019 (6) TMI 75
Initiation of the Liquidation Proceedings against the Corporate Debtor - Liquidation of Corporate Debtor under section 33(1)(a) of the I B Code - carrying on the business of the Corporate Debtor for its beneficial liquidation in terms of section 35(1)(e) of I B Code - appointment of Applicant/Resolution Professional as the Liquidator under section 34 of the I B Code - HELD THAT:- In the grounds, the Resolution Professional has stated that as per Section 33(1)(a), upon completion of the maximum period under section 12 of the I B Code, 2016, this Authority may pass an order requiring the Corporate Debtor to be liquidated as laid down under Chapter III of the I B Code, 2016. It is stated by the Resolution Professional that no Resolution Plan was approved by the CoC, the maximum period of 270 days has also been completed on 30.10.2018, and therefore, the Corporate Debtor may be ordered for liquidation on a 'going concern' basis - Since, no Resolution Plan has been received by this Authority under sub-section (6) of Section 30 of the I B Code, 2016, before the expiry of the maximum period of 270 days of CIR Process, the Corporate Debtor has to be ordered for Liquidation. Application filed by the Resolution Professional under Section 33(l)(a) of the I B Code, 2016, for initiation of the Liquidation Proceedings against the Corporate Debtor viz., M/s. Summer India Textiles Mills Private Limited is allowed.
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Service Tax
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2019 (6) TMI 104
Insurance Auxiliary Services - commission amount paid to the insurance agents - service tax was paid on reverse charge mechanism. Subsequently appellants recovered the amount equivalent to the Service Tax paid on the commission charges from the agents - Alleging that since the Appellant has recovered the Service Tax from the insurance agents, even though the Service Tax was required to be paid by the Appellant, therefore, such collection is without authority of law and accordingly required to be deposited as per Section 73A(2) of Finance Act, 1994 - demand alongwith interest and penalty - invocation of extended period of limitation - Valuation - inclusion of pre-recruitment training expenses, in the value of commission paid. Whether service tax paid by the Appellant in accordance with Rule 2(1)(d)(iii) of Service Tax Rules, 1994 as recipient of Insurance Auxiliary service and then recovered from the service providers i.e. insurance agents is required to be deposited as per Section 73A(2) of Finance Act, 1994? - HELD THAT:- In the present case, the Revenue sought to recover the amount of service tax initially paid by the Appellant, but later passed on the burden under an agreement/arrangement to the insurance agents, while paying their commission for the service received. Neither side raised the issue that the service tax amount paid by the Appellant has been collected in excess from the insurance agents; it is the plea of the Revenue that since the payment of service tax has been cast on the recipient of service by virtue of Rule 2(1)(d)(iii) of Service Tax Rules, 1994, hence, the person liable to discharge service tax should absorb the liability and hence such person is precluded from shifting the burden to the insurance agent. However, in the event he passes on the service tax burden, then he is required to deposit the said amount with the govt., as the tax amount is not required to be further collected from the insurance agents - for the purpose of administrative convenience, the collection of service tax could be made either from the service provider or service recipient in relation to the service which is the object of the tax. Merely because the tax is collected from the service recipient, the character of the service tax will not be altered, but it would continue to remain as service tax only. Therefore, the reasoning of the learned Commissioner that since the service tax on Insurance Auxiliary service since to be paid by the Appellant, is in the nature of direct tax, hence, not authorised to pass on the burden to the Insurance agents. Whether the person is liable to pay service tax by virtue of Rule 2(1(d)(iii) of Service Tax Rules, 1994 is prohibited from passing on the burden to the customer? - HELD THAT:- There are no stipulation under the Act or under Rule 2(1)(d)(iii) of Service Tax Rules,1994 which puts an embargo on an assessee who is initially required to discharge service tax, if later elects to shift the burden to the provider of service or to any other person by an arrangement or agreement, is restricted in doing so - In absence of any such stipulation to say that the burden of service tax initially discharged by the service recipient cannot be shifted to the service provider, there is no prohibition on such passing of burden. Whether the amount collected by the Appellant from the insurance agent is required to be deposited even though initially the applicable tax amount has been paid to the Government? - HELD THAT:- This Tribunal, after analyzing the scheme of sub-section (1) and sub-section (2) of Section 73A, arrived at the finding that any amount if collected in excess only is required to be deposited with the Government. Valuation - expenses incurred in pre-recruitment training and post licence training of the Insurance Agents - inclusion in the value of commission paid to the agents - HELD THAT:- Only w.e.f. 14.05.2015, by virtue of provision of Section 67 itself, such reimbursable expenditure or cost would also form part of the value of taxable service for charging service tax. In other words, prior to 14.05.2015, such expenditure or cost incurred by the assessee in providing taxable service cannot be included in the value of service - pre and post training expenses, incurred by the Appellant cannot form part of the value of commission paid to the insurance agents. Thus, the service tax initially paid by the Appellants and later collected from the insurance agents by adjusting the commission paid, cannot be directed to be deposited under Section 73A(2) of Finance Act, 1994 - The expenses incurred in pre-recruitment training and post licence training of insurance agents by the Appellants cannot form part of the gross taxable value of commission paid to the Insurance Agents in determining the service tax liability. Appeal allowed - decided in favor of appellant.
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2019 (6) TMI 74
Utilization of CENVAT Credit - receipt of services from overseas service providers and discharged service tax under reverse charge mechanism - whether the appellant is eligible to utilize cenvat credit in discharging such service tax? - Rule 5 of the Taxation of Services (Provided from outside India and received in India) Rules, 2006 - HELD THAT:- Similar issue decided in the case of M/S. USV LTD. VERSUS COMMISSIONER OF SERVICE TAX, MUMBAI [ 2018 (4) TMI 617 - CESTAT MUMBAI ] where it was held that Under CCR 2004 there is no bar for utilization of Cenvat credit for the deemed service provider to pay the service tax liability casted upon him in terms of Section 66A - In terms of Rule 2 (r) the Appellant is a deemed service provider. Rule 5 of Taxation of Service Rules (Provided from outside India and Received in India) Rules only refers to availing of Cenvat Credit and not utilization of cenvat credit. Utilization of credit is not incorrect - appeal allowed - decided in favor of appellant.
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2019 (6) TMI 73
Imposition of penalty - irregularly availed CENVAT Credit reversed before the issuance of show cause notice - intent to evade or not - HELD THAT:- In the instant matter since the appellant had sufficient balance in cenvat account therefore it cannot be said that they had utilised the same. It is not disputed that after it was pointed out by the audit party the same was reversed by the appellant immediately without even waiting for the show casue notice, therefore it cannot be said that there was any intention on the part of the appellant to evade payment of tax or that they had utilised the amount credited. It is settled by catena of decisions that wrong availment of cenvat credit but non-utilising the same do not lead to any consequence. In the present case, the Revenue has failed to brought on record any evidence to prove fraud or collusion or wilful suppression on the part of the Appellant and the Appellant by its conduct has proved that that there was no malafide intention on its part and it was only a bonafide error on the part of the Appellant, which was rectified immediately on pointing out by the audit party and therefore in these circumstances no penalty is imposable on the Appellant. Appeal allowed - decided in favor of appellant.
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2019 (6) TMI 72
CENVAT Credit - reversal of CENVAT credit on exempt goods - reversal of cenvat credit on proportionate basis done or not - suppression of facts or not - HELD THAT:- A similar issue has come up for consideration before the Principal Bench Tribunal in the matter of M/S JAI BALAJI INDUSTRIES LIMITED VERSUS CCE ST, RAIPUR [ 2016 (12) TMI 841 - CESTAT NEW DELHI] in which although the assessee reversed the cenvat credit on proportionate basis, but the same was not accepted by revenue authorities. Since in the instant matter also it is one of the contentions of the Appellant that the reversal of proportionate cenvat credit has not been considered by the authorities below while deciding the matter, therefore without going any further in the merits of the matter and following the decision as aforesaid, I am inclined to remand the matter to the Adjudicating Authority. Appeal allowed by way of remand.
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2019 (6) TMI 71
Levy of Service Tax - hospital services to doctors - providing consulting rooms required by the panel/non-panel doctors for treating their (doctor s) patients in the OPD. - Support Services for Business or Commerce (BSS) - difference of amount charged by the appellants-hospitals to the patients towards doctors consultation and the charges paid by them to the visiting/consulting doctors - HELD THAT:- As per the provisions governing the service tax statute, prior to July 2012, the value of taxable services was determined under Section 67 of the Finance Act, 1994. The statutory provisions prevalent at the material time provided that the value of any taxable service shall be the gross amount charged by the service provider for such service provided or to be provided by him. - After 1st July 2012, the term service has been defined in Section 65B (44) of the Act to mean inter alia, that any activity carried out by a person for another for consideration. In the present cases, admittedly the appellants-hospitals did not charge the doctors at all. There is no payment by the doctors to the hospital and therefore, no consideration is received by the hospitals from the consultant doctors. Thus, in absence of any consideration being received, no service tax is required to be paid by the hospitals. On perusal of the contracts, it is found that there is no privity of contract between the doctors and the patients and the patients are under no obligation to pay any amount to the doctors. The billed amount paid by the patients is reflected as the income of the hospitals alone in the books of accounts and the doctors are paid for the amount as per the contractual norms, on which the hospitals deduct the tax at source under the income tax statute. Further, also the department has not brought on any evidence to show the nature of support services provided by the hospitals to the doctors - Hence, is absence of any specific allegation and discussions with any supporting evidence regarding the type of support services provided and the amount received on such account by the hospitals, service tax demand cannot be fastened on the hospitals under the taxable category of BSS/Support Services. In order to arrive at a definitive conclusion on the taxability of service, the main ingredients which need to be necessarily present, as per this statute, are the service, service provider, service receiver and the consideration for the service - In the instant case, the alleged service provider is undoubtedly the hospitals/ institutions; the service rendered is to the patients; remuneration is received by the hospitals/institutions and is paid by the patients. Understandably, the services rendered by the hospitals/institutions are at best medical services to the patients and by no stretch of imagination Business Support Services . It is immaterial that the hospitals are paying a portion of the remuneration received to the doctors for the services rendered by them to the hospitals. Counsels for the appellants submitted that wherever the Hospitals are providing infrastructural services per se to the doctors, i.e. without any reference to the patients admitted to the Hospitals, they are paying applicable service tax. Under the circumstances, it cannot be alleged that the hospitals are providing Business Supports Services to the doctors. Therefore, the argument taken on the basis of discussions between a Profession and Business are not relevant to the present facts of the case. The Appellant hospitals/institutions are not liable to pay service tax under the category of Business Support Services - appeal allowed - decided in favor of appellant.
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2019 (6) TMI 70
CENVAT credit - input services - rent-a-cab service which admittedly was hired by the Appellant to provide car service to their guests - HELD THAT:- An identical issue came up for consideration before a coordinate bench of the Tribunal in the matter of Marvel Vinyls Ltd. vs. Commissioner of Central Excise, Indore [2016 (11) TMI 1126 - CESTAT NEW DELHI] and the Tribunal while deciding the issue in favour of Appellant therein held that the interpretation that motor vehicle are not capital goods for the service recipient cannot be appreciated inasmuch as motor vehicles are admittedly capital goods for the service provider in terms of Rule 2(a) of CCR, 2004. The appellant is entitled to the Cenvat credit on service tax paid on the aforesaid service - appeal allowed - decided in favor of appellant.
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2019 (6) TMI 69
Classification of services - Commercial or Industrial Construction Service - works contract‛ w.e.f. 01.06.2007 - Composition scheme - HELD THAT:- The issue in dispute is squarely covered by the case laws cited by him, in particular, that of the Hon ble Apex Court in COMMISSIONER, CENTRAL EXCISE CUSTOMS VERSUS M/S LARSEN TOUBRO LTD. AND OTHERS [ 2015 (8) TMI 749 - SUPREME COURT] for the period upto 01.06.2007 where it was held that Works contract were not chargeable to service tax prior to 1.6.2007 - For the period after 01.06.2007, the Chennai Bench of the CESTAT in the case of REAL VALUE PROMOTERS PVT. LTD., CEEBROS PROPERTY DEVELOPMENT, PRIME DEVELOPERS VERSUS COMMISSIONER OF GST CENTRAL EXCISE, CHENNAI [ 2018 (9) TMI 1149 - CESTAT CHENNAI] have extrapolated the ratio laid down by the Hon ble Apex Court in M/s.Larsen Toubro Ltd. and held that even after 01.06.2007, service tax liability for composite contracts can only be demanded under Works Contract Service and not under CICS etc. Demand set aside - appeal allowed - decided in favor of appellant.
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Central Excise
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2019 (6) TMI 68
Classification of goods - Covered yarn manufactured by the appellants - whether classified under 5605.10 or 5605.90 or 5605.00? - benefit of N/N. 45/1986 - Clandestine removal - undervaluation of metallized yarn - undervaluation of covered yarn - CENVAT Credit on inputs. Classification of goods - Covered yarn - Appellants submit that the obtain metallic yarn by micro-slitting lacquered metalised polyester film; Department has accepted its classification under heading 5605.10 - benefit of N/N. 45/1986 Central Excise dated 10.02.1986 - HELD THAT:- Heading 5605 covers metalised yarn, whether or not gimped, being textile yarn, or striped or light heading No.54.06 or 54.07, combined with metal in the form of thread, striped or powder or covered with metal. It is evident that the covered yarn manufactured by the Appellants contained metalised yarn (67%) and nylon/polyester/viscose yarn (33%) in terms of Chapter Note 1 to the Chapter 54 - there is no doubt that nylon/polyester/viscose are man-made filaments. Therefore, metalised yarn of man-made filaments falls under 5605.10. The classification requires to be arrived in terms of section notes and chapter notes and the references to the respective headings or sub-headings - the impugned goods are classifiable under 5605.10 and are covered by the exemption notification 45/1986 Central Excise dated 10.02.1986. Clandestine removal - covered yarn - period April 1990 to March 1991 - HELD THAT:- The averment that the total clearances of the Appellant to M/s. Hiro Industries tally with the invoices issued by M/s. Hiro Industries cannot be accepted. We find that the Appellants have not accounted for the clearance of 1776.75 kg of covered yarn - the Learned Commissioner had correctly confirmed the duty of ₹ 1,04,525 on the Appellants. Under-valuation - it has been alleged that the Appellants have under-valued the goods in as much as they have cleared 90% of the covered yarn to M/s. Hiro Industries @ ₹ 150 to ₹ 200/Kg and that M/s. Hiro Industries sold the same to other buyers at ₹ 425/kg - related party transaction - Extended period of limitation - HELD THAT:- The department has not made out any case to establish that the Appellants and M/s. Hiro Industries are related; no mutuality of interest is established; no proof of flow back of money has been brought out. The value adopted by M/s. Hiro Industries to their customers cannot be adopted just for the reason that M/s. Hiro Industries are purchasing 90% of the clearance of the Appellants and for the reason that they are selling at higher price to their customers - Other than mentioning the entries in the petty cash book the department could not establish that the entries pertained to the sale of goods and monies recovered back by the Appellants. Moreover, the impugned period was under the regime of filing an approval of classification and price lists - extended period of limitation also cannot be invoked - the allegation of under valuation is not sustained. Demand of duty of ₹ 1,12,321 by holding that exemption under notification No.175/86 is not applicable to the Appellants during the year 1991-92 - HELD THAT:- The exemption under notification 45/86 as claimed by the Appellants is applicable to them. Therefore, the exemption contained under 175/86 is also applicable to them. Confiscability of 777.175 kg of covered yarn - HELD THAT:- Out of 1546.21 kg of covered yarn lying in the factory only 769.035 kg was accounted in RG1 register. We find that the Appellants have not given any satisfactory explanation for the same - the Learned Commissioner was right in confiscating the 777.175 kg of covered yarn - quantum of redemption fine reduced. CENVAT credit - inputs - demand of ₹ 7, 21,507 on account of clearance of metalised polyester film without reversing the credit availed on such raw material - Scope of SCN - HELD THAT:- Though CESTAT has held that lacquering does not amount to manufacture, the fact that credit has been availed on the inputs used in the clearance of metalised yarn cleared as such or after lacquering. However, the Appellants submit that the issue raised by the Learned Commissioner is beyond the scope of the Show Cause Notice. On-going through the Show Cause Notice we find that the Appellants contention are correct - Learned Commissioner has travelled beyond the scope of the Show Cause Notice. Therefore, the demand is liable to be set aside. Penalties in terms of Rules 173 Q, 9(2), 52A, 210 226 - HELD THAT:- The sustainable demand is now limited to ₹ 1, 04,525 we find that the penalty be also restricted to ₹ 1,00,000 - other penalties also set aside. Appeal allowed in part.
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2019 (6) TMI 67
CENVAT Credit - input services in the nature of the employee benefit - life insurance of employees - period July 2013 to March 2017 - extended period of limitation - penalty - HELD THAT:- The period involved in the present case is after the amendment in the definition of input service . The definition of input service post amendment contained exclusion clause and the exclusion clause was effective from 01.04.2011 and clause (C) of the said exclusion specifically excluded the services provided in relation to Life Insurance and Health Insurance. These services prior to 01.04.2011 have been held to be covered by the definition of input service . In fact the need for exclusion would arise only when the services are otherwise covered by the definition. The Legislature in its wisdom has excluded certain services from the availment of cenvat credit w.e.f. 01.04.2011 when such services are otherwise covered by the main definition clause of the input service. Extended period of Limitation - Penalty - HELD THAT:- The issue involved in the present case relates to interpretation of the definition of input service therefore extended period cannot be invoked and penalties cannot be imposed - the penalties under Rule 15(2) of Cenvat Credit Rules, 2004 read with Section 11AC (i)(c) of Central Excise Act, 1944 set aside - extended period also not available. The matter is remanded back to the original authority to re-quantify the demand for the normal period which the appellant is liable to pay - appeal allowed by way of remand.
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2019 (6) TMI 66
CENVAT Credit - input services - Insurance on Public liability/Staff - Workmen compensation and Membership fee paid to various associations etc. - denial on account of nexus - period involved is after the amendment in the definition of input service - HELD THAT:- The only ground which the learned consultant for the appellant has taken to justify the availment of cenvat credit on Medi-claim Policy for Employees and Group Personal Accident Insurance Policy is that the appellant is statutorily required to take the said policy under various Labour Laws - I find that this argument of the learned consultant has no force in view of the exclusion clause provided in the definition of input service w.e.f. 01.04.2011. These services prior to 01.04.2011 have been held to be covered by the definition of input service . The Legislature in its wisdom has excluded certain services from the availment of cenvat credit w.e.f. 01.04.2011 when such services are otherwise covered by the main definition of the input service . Penalty - HELD THAT:- The issue involved in the present case relates to interpretation of the definition of input service and therefore the imposition of penalty of ₹ 83,000/- under Rule 15(1) of the Cenvat Credit Rules is not justified - Penalty set aside. Demand upheld - penalty set aside - appeal allowed in part.
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2019 (6) TMI 65
CENVAT Credit - Secondary Education Cess and Customs Higher Education Cess paid on the goods imported by them - HELD THAT:- As per Rule 3(1) of CENVAT Credit Rules, 2004, CENVAT credit cannot be taken on Customs Secondary Education Cess and Customs Higher Education Cess whereas in the present case, the Bill of Entry clearly shows that appellant has availed CENVAT credit of Customs Secondary Education Cess and Customs Higher Education Cess and further the Bill of Entry clearly indicates that Education Cess on CVD was zero. In view of this specific mention in the Bill of Entry that the appellant has availed CENVAT credit of Customs Secondary Education Cess and Customs Higher Education Cess which is not permitted under CENVAT Credit Rules. Further, the Commissioner (A) has discussed all the grounds raised by the appellant and has come to the conclusion that the appellant is not entitled to take the credit on the Cess paid by them. Appeal dismissed - decided against appellant.
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2019 (6) TMI 64
Condonation of delay of 3 years and 44 days in filing the appeal - Section 35B(7) of Central Excise Act, 1944 - HELD THAT:- The applicant filed a Restoration of Appeal application on 03.01.2018 for Restoration of Appeal which was dismissed as withdrawn by him and Tribunal dismissed the said application vide M.O. No. 20444/2018 dated 20.03.2018. Thereafter, the applicant has filed the present appeal along with COD application seeking condonation of delay of 3 years and 44 days in filing the appeal. Instead of challenging the decision of this Tribunal dismissing his ROA application vide order dated 23.02.2018 appellant has filed the present appeal on the same grounds which were filed earlier with a prayer to condone the delay of 3 years and 44 days. The application seeking condonation of delay of 3 years and 44 days is dismissed - application for COD dismissed.
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2019 (6) TMI 63
Area Based Exemption - N/N. 50/2003-CE dated 10.6.2003 as amended - period of dispute is 15/06/2007 to 18/03/2008 - it has been alleged that the appellant did not file declaration as required under said Notification before effecting first clearance, therefore benefit of exemption under the said Notification is not available for the period 15/06/2007 to 18/03/2008 - time limitation. HELD THAT:- There is no dispute that the goods being manufactured are not in the negative list of Annexure-I, and the unit is located in the specified Industrial Area mentioned in Annexure-II to the Notification No.50/2003-CE. - Since, the declaration has been made by the appellants themselves on 19.3.2008 and the same is correct, the jurisdictional Central Excise Authorities should have examined the question regarding the appellant company s eligibility for exemption during the period prior to 19.3.2008, but they chose to sleep over the declaration and issued a Show Cause Notice on 8.10.2011. The appellant cannot be charged with suppression or mis-statement for more than three years long delay in issue of Show Cause Notice. The proviso to sub-Section 11A(1) cannot be invoked by the department. Hence, the demand of Show Cause Notice is time barred and the impugned Order is not sustainable on the ground of limitation. Appeal allowed - decided in favor of appellant.
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CST, VAT & Sales Tax
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2019 (6) TMI 62
Writ against assessment order - principles of natural justice - audit of taxes for assessment year 2010-2011 - alternative efficacious remedy of appeal - production of books of accounts and related documents for verification - rejection of refund without notice - It is the case of the petitioner that ex-parte proposition notice was issued on 14.09.2016 and the said notice was received on 24.09.2016 - HELD THAT:- The contention that no proposition notice was issued, cannot be accepted in view of the fact that the petitioner has received the notice dated 14.09.2016 issued under Sections 39(1), 36 and 72(2) of KVAT Act, 2003. Further the representative of the petitioner appeared before the respondent assessing authority and produced the books of accounts. Therefore, the petitioner cannot contend that there is violation of principles of natural justice. Section 52 of the KVAT Act, provides for an appeal before the First Appellate Authority and the petitioner can very well raise all such objections including the violation of principles of natural justice before the Appellate Authority. In view of availability of an alternative efficacious remedy of appeal to the petitioner, the learned Single Judge has rightly dismissed the writ petition with liberty to raise such objections before the next Higher Authority. Appeal dismissed.
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Indian Laws
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2019 (6) TMI 61
Supply of information to the Tehsildar/Sub-Divisional Magistrate, as has been sought by him as per an application received under the Right to Information Act - HELD THAT:- In the present case, the information, which has been sought by the Public Information Officer, O/o Tehsildar/Sub-Divisional Magistrate, is required to be supplied to the said authority for the reasons, as have been detailed in the order dated 12.09.2018 passed by the Chief Information Commissioner, Punjab, with which reasons this Court agrees as it is a statutory duty cast upon the Document Writers which they are fulfilling. As regards the fiduciary relationship is concerned, there is no such relationship between the petitioners and the third party whose documents are being sought to be registered and entries thereof made in the registers/documents maintained by them. What is required and rightly so observed by the Chief Information Commissioner in his order dated 12.09.2018 is that the petitioners are bound to supply the information as available on their records to the Public Information Officer which they maintained in their statutory duties, which, thereafter, has to be processed keeping in view the provisions of Section 8 (1) and Section 9 of the Right to Information Act by the Public Information Officer. The duties, therefore, which are cast upon the Public Information Officer, cannot be exercised by the petitioners, who are the Document Writers. They are mandated to supply the said information to the Registrar-cum-Tehsildar, who shall, thereafter, proceed to deal with the said information as per the provisions of the Right to Information Act. Petition dismissed.
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