Direct Tax Basket 2015-TIOL-148-HC-MUM-IT + Story Om Vinyls P Ltd Vs ITO Income Tax - Sections 147, 148 Keywords - reassessment - investigation - material facts - non disclosure - accommodation entry Whether the fact revealed during investigation that the assessee is a beneficiary of an accommodation entry is sufficient for the AO to prima-facie conclude the absence of true and full disclosure of all facts - Whether a disclosure even if full may not be true - Whether assessment can be validity reopened when on reading of the reason in support of the notice u/s 148 as a whole, brings out the failure on the part of assessee to disclose fully and truly all material facts necessary for assessment - Whether the AO is required to conclusively prove that the reasons in support of the impugned notice establish that the assessee has taken accommodation entries, although such information is specific and involves no ambiguity. - Assessees writ petition dismissed : BOMBAY HIGH COURT 2015-TIOL-147-HC-MUM-IT CIT Vs Smt Manju R Gupta Income tax - Section 80IB(10) Keywords - buyer - developer - developmental work - residential project & size of construction area Whether a developer can be denied benefit of 80IB(10) for crossing the permissible limit regarding size of project area, by either withdrawing or adding a portion from adjacent flats, if the developer has done so on the request of buyer at the time of sale - NO: HC Whether deduction u/s 80IB(10) can be denied, if it is not the developer who constructed the commercial units and in excess of the prescribed limit, but, it is the buyers claiming through them occupying the same converted the user from residential to nonresidential - NO: HC - Revenues appeals dismissed : BOMBAY HIGH COURT 2015-TIOL-146-HC-MUM-IT CIT Vs Shri Ratansingh M Rathod Income Tax Keywords: loans - cash credit - books of accounts - rejection - income on estimation basis - turnover - subcontractors Whether in case pure findings of fact are being assailed by the Revenue, the High Court is expected to accept such issue as a valid question of law - Whether the High court can reappreciate and reappraise the said findings of fact at the behest of the Revenue without any perversity being demonstrated. - Revenues appeal dismissed : BOMBAY HIGH COURT 2015-TIOL-145-HC-DEL-IT CIT Vs V K Narang HUF Income Tax - Sections 158BC, 158BD Keywords: search assessment - time limit - satisfaction note - block returns Whether for the purpose of Section 158BD, a satisfaction note is sine qua non and must be prepared by the assessing officer before he transmits the records to the other assessing officer who has jurisdiction over such other person. - Revenues appeal partly allowed : DELHI HIGH COURT 2015-TIOL-144-HC-AHM-IT Vijay Proteins Ltd Vs CIT Income tax - Sections 40A(3), 143(3), 145(2), 256(1) & 271(1)(c). Keywords - bogus transactions - freight payments - fictitious invoices - penalty & undisclosed income. Whether a claim of deduction on freight payments can be disallowed u/s 40A(3), when such payments are shown to have been made by crossed cheques and entries for the transaction are clearly shown in books of A/c - NO: HC Whether an inference can be drawn that the assessee has inflated the expenditure by showing higher amount of purchase price through the fictitious invoices in the names of bogus suppliers, where the goods were not received from the parties from whom it is shown to have been purchased but, from a different source exclusively within the knowledge of assessee only - YES: HC Whether penalty u/s 271(1)(c) can be levied on basis of any guess work - NO: HC Whether it is open to the assessee to seek immunity under clause (2) of Explanation 5 to section 271(1)(c) for payment of tax together with interest in respect of such undisclosed income up to the date of payment - YES: HC - Assessees appeal allowed : GUJARAT HIGH COURT 2015-TIOL-143-HC-AHM-IT CIT Vs Winner Business Link Pvt Ltd Income Tax - Section 145 Keyword - method of accounting, membership fee. Whether the AO is required to compute the income in accordance with the method of accounting regularly employed by the assessee - Whether matching principle is required to be followed in order to arrive at the real income of the assessee - Whether the one-time and non-refundable membership fee received by the assessee from the members enrolled in a particular accounting year, is to be taxed in the year of receipt or is required to be spread proportionately over the entire period of their membership. - Revenue’s appeal dismissed : GUJARAT HIGH COURT 2015-TIOL-72-ITAT-LKW M/s VVS Concast Ltd Vs DCIT Income Tax - Sections 143(3), 147, 148, 151(2) & 292BB. Keywords - Notice void ab initio - Validity of reopening of assessment. Whether section 151(2) of the Act mandates satisfaction of JCIT for issuance of notice u/s 148 of the Act and hence the reopening of assessment with the approval of the CIT is not sustainable - Whether if there is no valid jurisdiction for issuance of notice u/s 148 of the Act, provisions of section 292BB of the Act would apply if the assessee participated in the reassessment proceedings. - Assessees appeal allowed : LUCKNOW ITAT 2015-TIOL-71-ITAT-PUNE Shri Vittal Shripati Ladkat Vs ACIT Income tax – Section 153C Whether where AO of the persons searched and of the persons to whom the documents belong, which were found from the possession of the searched persons was same, it cannot be said that no satisfaction was recorded that the material found during the search belonged to the assessee. - Assessee’s appeal partly allowed : PUNE ITAT 2015-TIOL-70-ITAT-HYD VED PRAKASH AGARWAL Vs DCIT Income Tax - Sections 43(5), 68, 132, 143(3) & 153A. Whether in the absence of any incriminating material, general disallowance of expenditure at 50% as was done by AO cannot be sustained – Whether the loss on forward contract transactions to care against loss through the price fluctuations, is eligible to be treated as business loss and is covered by the proviso to section 43(5) – Whether in the absence of any incriminating material or in the absence of any other details, there is no justification for resorting to gross profit addition – Whether AO is not justified in not giving credit for seized cash as requested in the computation of total incomes and consequently charging of interest u/s 234B. - Assessee’s appeal partly allowed : HYDERABAD ITAT Indirect Tax Basket SERVICE TAX SECTION 2015-TIOL-142-HC-MAD-ST Dhandayuthapani Canteen Vs CESTAT Service Tax - Service tax paid before the issue of Show Cause Notice - Penalty of Rs 10,000/- imposed by the Adjudicating Authority enhanced to amount equal to the Service Tax by revising the order by the department under Section 84 of the Finance Act, 1994 - Assessee in appeal against the order passed under Section 84. - Appeal dismissed : MADRAS HIGH COURT 2015-TIOL-150-CESTAT-BANG M/s Tops Security Ltd Vs CCE Service Tax - Payment details related to tax liability - Certified statement of CA found to be incorrect on facts - So also the verification report of Superintendent lacks details of balance amount to be paid and adjustable as arrears - Questionable approach and lack of seriousness of the parties in not verifying and placing on record facts correctly, deprecated - Appellant directed to submit another CA report - Assistant Commissioner directed to get another report based on payments made, self verification and certify the correct amount payable - Matter adjourned with both sides to exchange their respective statements. - Interim order disposed of : BANGALORE CESTAT 2015-TIOL-148-CESTAT-DEL + Story Airport Authority of India Vs CST Service Tax – Airport Services – Any service provided does not mean any taxable service provided: the words any service provided would cover any service other than those covered by other clauses of section 65(105)(zzm), which have been provided in an Airport or a Civil Enclave by AAI or a person authorised by it. - Order mostly in favour of Revenue : DELHI CESTAT 2015-TIOL-147-CESTAT-MUM M/s Crest Premedia Solutions Pvt Ltd Vs CCE ST - Rebate claim - rebate on inputs and inputs services under Notfn 12/2005-ST used in providing taxable services which are exported - Appellant complied with conditions prescribed in Notfn - However procedure was not followed to the extent that declaration was filed after export of services - Records such as invoice on which input tax credit is availed and records indicating export of services will not reveal any information which is not verifiable later - contravention of not following procedure of filing declaration is indeed a procedural formality, for contravention of which substantial justice cannot be denied relying on case of Convergys India Pvt. Ltd - rebate sanctioned: CESTAT [Para 2, 6.1] - Appeal allowed : MUMBAI CESTAT CENTRAL EXCISE SECTION 2015-TIOL-141-HC-MAD-CX CCE Vs M/s India Cements Ltd Central Excise - MODVAT Credit on Capital goods - Credit on goods falling under CETH 84.74 during the period from 23.7.1996 to 31.8.1996 - Whether Notification No.25/96 dated 31.8.1996 has to be read only as clarificatory and retrospective effect has to be given for availing MODVAT credit - Issue covered by the decision of this High Court in assessees own case - Question of law answered in favour of the assessee and against the revenue. - Appeal dismissed : MADRAS HIGH COURT 2015-TIOL-140-HC-MAD-CX CC & CE Vs Premier Polytronics Pvt Ltd Central Excise - Penalty under Section 11AC - Revenue in appeal against order of Tribunal setting aside penalty. Held: In the light of the law enunciated by the Supreme Court on the question of penalty under Section 11 AC, the decision of the Tribunal holding that mandatory penalty is not leviable cannot be accepted and accordingly the same is set aside and the matter is remanded to the Tribunal to reconsider the issue afresh in the light of Supreme Court decisions and Notification No.14/96-CE (NT), dated 23.7.1996. - Appeals allowed by way of remand : MADRAS HIGH COURT 2015-TIOL-139-HC-MAD-CX CCE Vs M/s Sakthi Sugars Ltd Central Excise - Appeal to High Court - Jurisdiction - Whether the respondent assessee is entitled for exemption under Notification No 67/95 CE - The issue pertains to rate of duty that is payable by the respondent, but for the notification in question - The objection as raised by the respondent on jurisdiction of High Court under Section 35G is liable to be sustained, in view of the decision of the Supreme Court in Navin Chemicals Manufacturing & Trading Co. Ltd. - Vs - Collector of Customs- 2002-TIOL-460-SC-CUS, which decision has been followed by this Court in Commissioner of Central Excise - Vs - Vadapalani Press - (2014-TIOL-2208-HC-MAD-CX) - Appeals are disposed of with liberty to the appellant/department to move before the Supreme Court, if so advised - ( para 7 & 10). - Appeals disposed of : MADRAS HIGH COURT 2015-TIOL-149-CESTAT-MUM + Story M/s Kroslink Polymers P Ltd Vs CCE CE - Valuation - s.4, 4A of CEA, 1944 - Glues & Adhesives falling under Ch.35 of CETA, 1985 - Appellants stand that exemption under Rule 34 of the SWAM Rules, 1977 is not mandatory is not acceptable - as appellants are marking the packages as Industrial Use, they are exempted from affixing MRP and, therefore, goods have be valued u/s 4 of CEA, 1944 viz. transaction value - Demand upheld and appeal rejected: CESTAT [para 4, 5] - Appeal rejected : MUMBAI CESTAT CUSTOMS SECTION NON-TARIFF NOTIFICATION cnt15_011 CBEC amends exchange rate for Swiss Franc CASE LAWS 2015-TIOL-146-CESTAT-MUM CC Vs Buying Overseas Cus - Valuation - assessing officer has adopted transaction value in transactions where quantum of import is of the order of 1 MT or below, whereas, consignment imported was of 5 MT which was part of an order for 100 MT and imports were done directly from manufacturer - No evidence led by Revenue to show that discounts of 37.5% which is noticed, is not reasonable or is not in accordance with normal trade practice - no merits in appeal filed by Revenue so dismissed: CESTAT [Para 5.1] - Revenues appeal dismissed : MUMBAI CESTAT 2015-TIOL-145-CESTAT-MUM Bhushan Port World Vs CC Cus - Suspension of CHA licence continued for more than one year - Neither enquiry proceedings have been completed nor relied upon documents in support of charges against CHA have been given to appellant - A period of 9 months has been prescribed for completing enquiry proceedings and passing of an order under provisions of law - CBEC vide Circular 9/2010 has reiterated that these time-limits should be adhered to - Inasmuch as 15 months has passed since passing of suspension order and Customs authorities have not bothered to complete enquiry within stipulated period of 9 months, suspension need not be continued and CHA should be allowed to function - appeal allowed: CESTAT [Para 3, 5.1] - Appeal allowed : MUMBAI CESTAT
Posted on: Tue, 20 Jan 2015 07:52:15 +0000
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