Subscription   Feedback   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Articles Highlights TMI Notes SMS News Newsletters Calendar Imp. Links Database Experts Contact us More....
Extracts
Home List
← Previous Next →

LAKSHMI ENERGY AND FOODS LTD. Versus INCOME-TAX OFFICER & DEPUTY COMMISSIONER OF INCOME-TAX

Penalty under section 221(1)- Held that:- Liability of the assessee has increased and that credit rating of the assessee has reduced but there was a profit in the assessment year under appeal as well as in subsequent assessment year 2011-12. May be the profit has reduced but it is not a case that the assessee has not earned any profit. Therefore, considering the material on record, we do not find it to be a case of good and sufficient reasons for not paying the taxes as per law. Therefore, penal .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

f tax.

Considering the totality of the facts and circumstances as noted above, we hold that 20 per cent. of the penalty of outstanding demand was excessive, unreasonable and therefore, we modify the orders of the authorities below and direct the Assessing Officer to restrict the penalty under section 221(1) of the Act by restricting the penalty at 7.5 per cent. of the outstanding self-assessment tax of ₹ 8.14 crores and the Assessing Officer shall rework the penalty amount acco .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

al Member).-The appeal of the assessee as well as the cross-objection by the Revenue-Department are directed against the order of the learned Commissioner of Income-tax (Appeals) (Central) Gurgaon dated January 24, 2013. 2. Briefly the facts of the case are that the Assessing Officer found that assessment tax amounting to ₹ 8,14,66,981 in respect of the return filed by the assessee on October 14, 2010 for the assessment year under appeal, i.e., 2010-11 was not paid by the assessee. The Ass .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

f ₹ 1.62 crores, i.e., 20 per cent. of ₹ 8.14 crores under section 221(1) of the Act for failure of the assessee to pay assessment tax for the assessment year under appeal. 3. The assessee challenged the penalty order before the learned Commissioner of Income-tax (Appeals) and explained that the Assessing Officer had not acceded to the request of the assessee for adjustment of refund for the assessment year 2007-08 against the demand due for the assessment year under appeal. The subm .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

been deposited. However, the Department had adjusted the refund against the assessment year 2006-07 without intimating the assessee. Therefore, the assessee was under the bona fide belief that no assessment tax would be payable because the refund would be adjusted in the assessment year under appeal. The assessee in support of its submissions, relied upon several decisions. It was submitted that the refund should be adjusted at the instance of the assessee only. Therefore, the assessee could no .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

y CRISIL on review of the assessee's financial affairs. 4. The assessee also relied upon the decision of the Kerala High Court in the case of CIT v. Chembara Peak Estates Ltd. [1990] 183 ITR 471 (Ker) in which it was held that the assessee proved non-payment of tax stating paucity of funds and financial stringency due to unavoidable financial position. Therefore, penalty was cancelled. The assessee also relied upon the decision of the Calcutta High Court in the case of CIT v. Indo American E .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ssessment year 2007-08 against the demand for the assessment year 2010-11. It is an undisputed fact that self-assessment tax to the tune of ₹ 8,14,66,981 was payable by the assessee for the assessment year 2010-11. As per the provisions of the Act, the assessee is considered to be in default for failure to pay the whole or a part of self-assessment tax payable under section 140A(1)(i) and thereby rendering itself liable for penalty under section 221(1). The circumstances, viz., demand in d .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

s under which the adjustment was being made. Para 5 of the impugned order is reproduced below : '5. Vide this office letter dated March 15, 2011, it was brought to the notice of the assessee that it had claimed loss of ₹ 18,21,20,035 in its return of income for the assessment year 2006-07. This loss was disallowed by the Assessing Officer in the order dated December 30, 2008 passed under section 143(3) read with section 153A of the Income-tax Act, 1961, against which the assessee filed .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

tax Appellate Tribunal. It was found that ₹ 18,21,20,035 represented income for the assessment year 2006-07. Thus addition was made for the assessment year 2006-07 and the refund arose for the assessment year 2007-08. It was adjustable against the demand of assessment year 2006-07 and not from the self-assessment tax. It was further inti mated to the assessee by this letter that refund of ₹ 6,99,35,000 determined for the assessment year 2007-08 had been adjusted against the demand o .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

eration. Be that as it may, as rightly stated in the impugned order, the recovery of self-assessment tax is not a consequence of any order passed by the Department but was a consequence to the return filed voluntarily under section 139(1). It is clear from section 140A that it is the duty of the assessee to self assess his income and pay the tax so calculated together with interest as payable under the provi sions of the Act. Sub-section (3) of section 140A further provides that if the assessee .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

Assessing Officer." 5. The assessee challenged the levy of penalty under section 221(1) of the Act. The Revenue filed the cross-objection challenging that since the assessee did not pay self-assessment tax on the returned income, therefore, the learned Commissioner of Income-tax (Appeals) has erred in admitting the appeal in contravention of the provisions of section 249(4)(a) of the Act. 6. The cross-objection is filed by the Revenue-Department in the office of the Tribunal on May 29, 201 .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

of Income-tax (Central) Gurgaon vide letter dated March 28, 2014 and consequently same was conveyed to the Assessing Officer. Proposal was sent to the Additional Commissioner of Income-tax, Range Central, Chandigarh on May 1, 2014, for further direction and in the meantime certified copy of Form 36 was taken. Further approval of the Commissioner of Income-tax (Central) Gurgaon was sought which was conveyed vide letter dated May 7, 2014 and thereafter cross-objection by the Department was filed o .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ted. 8. On the other hand, learned counsel for the assessee submitted that the Revenue-Department has not explained any sufficient cause for not filing the cross-objection within the period of 30 days from the receipt of the notice in appeal of the assessee. Therefore, cross-objection is time barred. He has relied upon the decision of the Kerala High Court in the case of Silver Star Engineers v. ITO [2004] 266 ITR 376 (Ker) in which it was held as under (headnote) : "Held, dismissing the ap .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

he assessee had not satisfactorily explained the reason for the delay of six days. The Tribunal was justified in its refusal to condone the delay." 9. He has also submitted that the hon'ble Supreme Court had dismissed the special leave petition against this judgment reported in [2004] 266 ITR (St.) 2. 10. We have considered the rival submissions. Section 253(4) of the Income-tax Act provides that, "the Assessing Officer on receipt of the notice that an appeal against the order of t .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

sufficient cause for not presenting it within that period. The appeal of the assessee in I. T. A. No. 348 of 2013 against the penalty order under section 221(1) was taken up for hearing by the Appellate Tribunal on July 4, 2013. On this date, Shri Sudhir Sehgal appeared for the assessee and Shri Manjit Singh, Departmental representative appeared for the Revenue-Department. The appeal of the assessee was adjourned time to time on several dates. Therefore, it is clear that the Assessing Officer r .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

sue raised in the cross-objection to the Commissioner of Income-tax (Central) Gurgaon and thereafter the same proceedings were taken up by the Assessing Officer and the Commissioner of Income-tax (Central) also approved filing of the cross-objection vide letter dated May 7, 2014 and only thereafter, the cross-objection was filed in the office of the Tribunal on May 29, 2014. These facts clearly disclosed that prior to March 28, 2014, no steps had been taken by the Revenue-Department for filing t .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

s, the Department had itself mentioned in its affidavit and was aware of the date of the judgment of the Division Bench of the High Court as September 11, 2009. Even, according to the deponent, its counsel had applied for the certified copy of the judgment only on January 8, 2010, and the copy was received by the Department on the very same day. There was no explanation for not applying for certified copy of the judgment on September 11, 2009, or at least within a reasonable time. The fact remai .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

matter to the court by taking appropriate steps. The persons concerned were well aware or conversant with the issues involved including the prescribed period of limitation for taking up the matter by way of filing a special leave petition in the Supreme Court. In the absence of plausible and acceptable explanation, the delay could not be condoned mechani cally merely because the Government or a wing of the Government was a party before the court. Though in a matter of condonation of delay when .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

the Department had failed to give acceptable and cogent reasons sufficient to condone such a huge delay. By the court : Unless Government bodies, their agencies and instrumentalities have reasonable and acceptable explanation for the delay and there was bona fide effort, there is no need to accept the usual explanation that the file was kept pending for several months or years due to considerable degree of procedural red tape in the process. Government Departments are under a special obligation .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

uly 4, 2013 to March 28, 2014. In the absence of any explanation for non-action in the matter, it is difficult to believe that the Revenue-Department has any sufficient cause for not presenting the cross-objection within the period of limitation. The cross-objection of the Revenue is thus dismissed being time barred. 13. Now we take up the appeal of the assessee for levy of the penalty under section 221(1) of the Act. This provision provides for penalty payable when tax in default. When an asses .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

that where the assessee proves to the satisfaction of the Assessing Officer that the default was for good and sufficient reasons, no penalty shall be levied under this section. 14. From the facts of the case in the light of the findings of the authorities below, it is clear that self-assessment tax amounting to ₹ 8.14 crores in respect of the return filed by the assessee for the assessment year under appeal was not paid by the assessee. Even before us, it is not in dispute that the assesse .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

. In the case of the present assessee, the Assessing Officer has levied penalty of 20 per cent. of the arrears of taxes, i.e., 8.41 crores and levied the penalty of ₹ 1.62 crores. Therefore, it is to be considered whether the assessee has any good and sufficient reasons for default in payment of taxes or whether the Assessing Officer has correctly levied the penalty of 20 per cent. of the arrears of taxes. 15. The assessee pleaded before the authorities below that the Assessing Officer did .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

the adjustment of taxes from the refund of the assessment year 2007- 08 were not given in the case of the assessee. The assessee further pleaded that there was a financial difficulty in paying the taxes. Learned counsel for the assessee reiterated the same submissions and submitted that financial condition of the assessee-company was in bad shape which is evident from the perusal of the balance-sheet for the financial year 2010-11 as submitted and the funds had been blocked in the inventory, boo .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

cent. It would prove paucity of the funds in the case of the assessee. 16. Learned counsel for the assessee also submitted that these circumstances ultimately led to dip in the credit rating as is evident from pages 8 and 9 of the paper book which had also worsened financial condition of the assessee. Due to paucity of the funds and steep fall in the profit during the financial year 2010-11, during which self-assessment tax was to be paid, due to paucity of funds the taxes could not be paid. Th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

s reduced but there was a profit in the assessment year under appeal as well as in subsequent assessment year 2011-12. May be the profit has reduced but it is not a case that the assessee has not earned any profit. Therefore, considering the material on record, we do not find it to be a case of good and sufficient reasons for not paying the taxes as per law. Therefore, penalty shall have to be levied in the facts and circumstances. However, considering the financial position of the assessee has .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

what is new what is new
  ↓     Latest Happenings     ↓  

Forum: GST on RCM on rent in a unregistered state

Forum: COMPOSITION SCHEME

Article: Websites of Government Departments need lot of improvement. We are noticing detoriations in them for example, case of website of ITAT.

Highlight: Levy of additions tax u/s 115O on distribution of dividend - shares of its profits declared as distributable among the shareholders is not impressed with the character of the profit from which it reaches the hands of the shareholder - not to be bifurcated as agriculture and non-agriculture dividend - SC

Highlight: Rate of GST on old and scrap buses - 28% or 18% - at such initial tender process initiated by the Respondents-KSRTC, the present petitions filed by the petitioners are premature and misconceived and do not require any interference by this Court at this stage. - HC

Forum: Rent a cab operator

Highlight: In view of amendment made u/s 132A of the Income Tax Act, 1961 by Finance Act of 2017, the 'reason to believe' or 'reason to suspect', as the case may be, shall not be disclosed to any person or any authority or the Appellate Tribunal, SC dismissed the appeal of the assessee

Highlight: Validity of Assessment Order - period of limitation u/s 153 (2A) is applicable even if the entire order was not set aside but matter was remanded back for for limited aspects with directions - HC

News: Note ban was a shake-up, achieved its main objectives

Notification: Amendments in the notification No.5/2017- Integrated Tax (Rate) dated the 28th June, 2017.

Highlight: Levying interest u/s 234C - interest is to be charged on the returned income and not on assessed income.

Highlight: Accrual of income - sale of right to develop and sell incentive FSI under LOI - till the conditions of LOI are fulfilled transfer is not complete and income does not accrue to the assessee

Highlight: TPA - determination of ALP - TP adjustment by applying Bright Line Test (BLT) is not sustainable on protective basis having no statutory mandate.

Highlight: Safeguard Duty - Advance License Scheme - as there is no exemption from safeguard duty leviable under Section 8C, which is imposed on the goods imported from China, the importer has to pay safeguard duty

Highlight: Manufacture - process of cutting of waste plastic container - Such plastic containers before and after cutting are nothing but waste / scrap - Not a manufacturing activity as no new product emerges.

News: NITI Aayog and Govt. of Assam organizes workshop on health sector reforms in Guwahati; launches SATH- Sustainable Action for Transforming Human Capital

Notification: Seeks to amend notification no. 5/2017- central tax(rate) dated 28.06.2017 to give effect to gst council decisions regarding restriction of refund on corduroy fabrics

Notification: Seeks to amend notification no. 2/2017- central tax(rate) dated 28.06.2017 to give effect to gst council decisions regarding gst exemptions

Forum: GSTR 3B Rectification

Notification: seeks to exempt Skimmed milk powder, or concentrated milk

Notification: Seeks to amend notification no. 2/2017- integrated tax(rate) dated 28.06.2017 to give effect to GST council decisions regarding GST exemptions.

Forum: 3B mistake

Notification: Seeks to amend notification no. 1/2017- central tax(rate) dated 28.06.2017 to give effect to gst council decisions regarding gst rates

Notification: Seeks to amend notification no. 1/2017- integrated tax(rate) dated 28.06.2017 to give effect to gst council decisions regarding gst rates.

Forum: GST - TRAN1 - filed - Data uploaded with Remarks Processed with Error - Not coming in Electronic credit ledger - need suggession guidance

News: Notification Issued For GST Actionable Claim On Branded Food Products

Highlight: Classification printed computer stationary/manifold Business Forms - to be classified under Chapter Heading 4820.00 or under Chapter Heading 4901.90 - items like A4 sheets, advertisement and job card to be classified under Chapter 49

Forum: GST Invoice

Article: RCM Applicability to persons not liable to get registered us 23(1)

Article: Credit of unsold stock [Section 140(3)] - Actual Credit as well as Notional Credit - Part-I - GST Transitional provisions

News: GST Refund - Blockage of Working Capital of Exporters - earlier also there was a normal blockage of funds for a period of 5-6 months at least

News: Clarification about Transition Credit - ₹ 1.27 lakh crore of credit of Central Excise and Service Tax was lying as closing balance as on 30th June, 2017 - claim of credit of ₹ 65,000 crore is not unexpected

Article: 20 Things You must know about E Way Bills in GST Law

Article: MISTAKES IN DRAFTING

Forum: Duty Drawback- Urgent

Highlight: The Customs and Central Excise Duties Drawback Rules, 2017 and All Industry Rates (AIRs) of Drawback related changes -reg. - Circular

Highlight: The definition of "subsidiary company" or "subsidiary" u/s 2(87) of the Companies Act, 2013 shall come into force w.e.f. 20-9-2017

Highlight: Central Government notified the All Industry Rates of Duty Drawback Schedule w.e.f. 1.10.2017 - Notification

Notification: All Industry Rates of Duty Drawback Schedule w.e.f. 1.10.2017

Circular: Investment by Foreign Portfolio Investors in Corporate Debt Securities Review

Notification: Exemptions on supply of services under UTGST Act

Notification: Rates for supply of services under UTGST Act

Notification: Exemptions on supply of services under IGST Act

Notification: Rates for supply of services under IGST Act

Notification: List of Exempted supply of services under the CGST Act

Notification: Rates for supply of services under CGST Act

Highlight: Acceptance of deposits by companies from its members - conditions relaxed in case of Specified IFSC Public company and a private company - Rule 3 amended

Notification: Rate of exchange of conversion of the foreign currency with effect from 8th September, 2017

News: Tax Payers Advised To Confirm Identities Of Income Tax Search Authorities

Notification: Amendment in Appendix 3 (SCOMET items) to Schedule- 2 of ITC (HS) Classification of Export and Import Items 2012



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version