Category: Tribunal

Archive for the ‘Tribunal’ Category


New Delhi Television Ltd vs. ACIT (ITAT Delhi)

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DATE: July 14, 2017 (Date of pronouncement)
DATE: July 20, 2017 (Date of publication)
AY: 2009-10
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CITATION:
S. 69A: NDTV indulged in a clear cut case of "abuse of organization form/ legal form and without reasonable business purpose” and therefore, no fault can be found with the order of the AO in charging to tax Rs. 642 crores by re-characterizing the conditions according to its economic substance and imposing the tax on the actual controlling Indian entity. There is no doubt that the transaction used principally as a devise for the distribution/ diversion of sum to the Indian entity. The beneficial owner of the money is the assessee

It is a clear out case of “abuse of organization form/ legal form and without reasonable business purpose and therefore, no fault can be found with the order of the Id Assessing Officer/ Id DRP in charging to tax Rs. 642 crores by re-characterizing the conditions according to its economic substance and imposing the tax on the actual controlling Indian entity. In the present case we do not have any doubt that the transaction used principally as a devise for the distribution/ diversion of sum to the Indian entity on review of all the facts circumstances surrounding the present transaction. In the present case, the beneficial Owner of the money is the assessee. This money trail stares so glaringly on the various complex structures created by the assessee that without proving any substance one cannot reach to any other conclusion but to the conclusion that series of the transaction entered into by the assess were to transfer Rs. 642 crores from the investor-company or the owner of the investor company to the assessee

Posted in All Judgements, Tribunal

Clarion Power Corp vs. Commissioner Of Customs (CESTAT)

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DATE: January 17, 2017 (Date of pronouncement)
DATE: June 29, 2017 (Date of publication)
AY: -
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CITATION:
Strictures passed against Advocate for making frivolous arguments without having the file and wasting the valuable time of the Court. Costs imposed

Shri. M. Selvakumar, learned counsel has made frivolous argument without having the file or and document in his hand. He has wasted the valuable time of the court. He also made a request for adjournment. This as a fit care where the Bench may recommend to Tamilnadu Bar Council to take appropriate action against him. But, by keeping a lenient view in mind, we adjourn the case at the cost of Rs. 1,000/-(Rupees on thousand only) which will deposited by the counsel toward Prime Minister’s Relief Fund within three days from today. On the next date of hearing, proof of deposit shall be submitted

Posted in All Judgements, Tribunal

ITO vs. Gravity Systems Pvt. Ltd (ITAT Delhi)

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DATE: March 30, 2017 (Date of pronouncement)
DATE: June 27, 2017 (Date of publication)
AY: 2004-05
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CITATION:
S. 143(2) notice: If the Department fails to produce evidence relating to the issue and service of the s. 143(2) notice, an adverse inference has to be drawn as per s. 114 of the Evidence Act. The s. 143(3) assessment order has to be held invalid and void ab initio

Once this Tribunal has directed the Revenue to produce the record with regard to the assessment so that it can be verified whether notice under section 143(2) of the Act has been issued and served on the assessee before completing the assessment under section 147/148 of the Act, the Revenue was bound to produce the record. But the Revenue could not produce the record and just explained in the Bar that the record has been misplaced. Under these circumstances, we are bound to take an adverse inference in view of the provisions of section 114 of the Evidence Act to the effect that had the assessment record been produced, the same would have gone against the interest of the Revenue

Posted in All Judgements, Tribunal

ACIT vs. Vireet Investment Pvt Ltd (ITAT Delhi) (Special Bench)

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DATE: June 16, 2017 (Date of pronouncement)
DATE: June 22, 2017 (Date of publication)
AY: 2008-09
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CITATION:
S. 14A/ Rule 8D: (i) The computation under clause (f) of Explanation 1 to section 115JB(2) is to be made without resorting to the computation as contemplated u/s 14A read with Rule 8D of the Income tax Rules 1962, (ii) Only those investments are to be considered for computing the average value of investment which yielded exempt income during the year

(i) The computation under clause (f) of Explanation 1 to section 115JB(2) is to be made without resorting to the computation as contemplated u/s 14A read with Rule 8D of the Income tax Rules 1962. (ii) Only those investments are to be considered for computing the average value of investment which yielded exempt income during the year.

Posted in All Judgements, Tribunal

AAA Paper Marketing Ltd vs. ACIT (ITAT Lucknow)

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DATE: April 28, 2017 (Date of pronouncement)
DATE: June 15, 2017 (Date of publication)
AY: 2011-12
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CITATION:
(i) S. 153A/ 153C: When the Addl CIT records that he is granting “mechanical approval” u/s 153D to the draft assessment order for want of time to have meaningful discussion, the assessment order is bad in law and has to be annulled (ii) The Respondent is entitled to raise an objection under Rule 27 even in respect of fresh issues. It is not necessary that the ground should have been decided against the Respondent by the CIT(A)

The approval granted by the Addl. Commissioner is devoid of any application of mind, is mechanical and without considering the materials on record. In our considered opinion, the power vested in the Joint Commissioner/Addl Commissioner to grant or not to grant approval is coupled with a duty. The Addl Commissioner/Joint Commissioner is required to apply his mind to the proposals put up to him for approval in the light of the material relied upon by the AO. The said power cannot be exercised casually and in a routine manner. We are constrained to observe that in the present case, there has been no application of mind by the Addl. Commissioner before granting the approval. Therefore, we have no hesitation to hold that the assessment order made u/s. 143(3) of the Act r.w. Sec. 153A of the Act is bad in law and deserves to be annulled

Posted in All Judgements, Tribunal

Crescent Construction Co vs. ACIT (ITAT Mumbai)

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DATE: May 26, 2017 (Date of pronouncement)
DATE: June 15, 2017 (Date of publication)
AY: 2005-06
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CITATION:
S. 147/ 148: Entire law on reopening of assessments in the context of "change of opinion" vs. "failure to apply mind", with reference to s. 114 of the Indian Evidence Act, 1872 and all judgements on the point discussed

Section 114 of the Evidence Act, 1872, is permissive and not a mandatory provision. Nine situations by way of illustrations are stated, which are by way of example or guidelines. As a permissive provision it enables to judge to support his judgment but there is no scope of presumption when facts are known. Presumption of facts under section 114 is rebuttable. The presumption raised under illustration (e) to section 114 of the Act means that when an official act is proved to have been done, it will be presumed to have been regularly done but it does not raise any presumption that an act was done for which there is no evidence or proof

Posted in All Judgements, Tribunal

ITO vs. Aditya Narain Verma (HUF) (ITAT Delhi)

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DATE: June 7, 2017 (Date of pronouncement)
DATE: June 9, 2017 (Date of publication)
AY: 2009-10
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CITATION:
S. 50C: Failure by the AO to refer the valuation of the capital asset to a valuation officer instead of adopting the value taken by the stamp duty authorities is a fatal error and the assessment order has to be annulled. The matter cannot be set aside to the AO for a second chance. The power of the ITAT to set aside cannot be exercised so as to allow the AO to cover up the deficiencies in his case

When the assessee in the present case had claimed before Assessing Officer that the value adopted or assessed by the stamp valuation authority under sub section (1) exceeds the fair market value of the property as on the date of transfer, the Assessing Officer should have referred the valuation of the capital asset to a valuation officer instead of adopting the value taken by the state authority for the purpose of stamp duty. The very purpose of the Legislature behind the provisions laid down under sub section (2) to section 50C of the Act is that a valuation officer is an expert of the subject for such valuation and is certainly in a better position than the Assessing Officer to determine the valuation. Thus, non-compliance of the provisions laid down under sub section (2) by the Assessing Officer cannot be held valid and justified

Posted in All Judgements, Tribunal

DDIT vs. Metapath Software International Ltd (ITAT Delhi)

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DATE: April 28, 2017 (Date of pronouncement)
DATE: June 9, 2017 (Date of publication)
AY: 1997-98
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CITATION:
S. 271(1)(c) penalty cannot be levied unless there is "evidence beyond doubt" that there was concealment of particulars of income or furnishing inaccurate particulars thereof on the part of the assessee. The fact that the assessee did not voluntarily furnish the return of income, and that the merits were decided against it, does not per se justify levy of penalty. The bonafides of the explanation of the assessee for not complying with the law have to be seen

It is an well established proposition of law that being penal in nature, the provisions of section 271(1)(c) of the Act are invoked only when there is evidence beyond doubt that there was concealment of particulars of income or furnishing inaccurate particulars thereof on the part of the assessee towards the tax alleged to be evaded. That is the reason behind that assessment proceedings and penalty proceedings are independent proceedings. In other words, making and sustaining an addition against the assessee will not be always resulted into levy of penalty

Posted in All Judgements, Tribunal

Kamla Devi S. Doshi vs. ITO (ITAT Mumbai)

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DATE: May 22, 2017 (Date of pronouncement)
DATE: June 2, 2017 (Date of publication)
AY: 2006-07
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CITATION:
Bogus penny stocks capital gain: The s. 131 statement implicating the assessee is not sufficient to draw an adverse inference against the assessee when the documentary evidence in the form of contract notes, bank statements, STT payments etc prove genuine purchase and sale of the penny stock. Failure to provide cross-examination is a fatal error

The A.O had chosen to merely rely on the stand alone statement of Sh. Mukesh Choksi (supra) and taking the same as gospel truth, had therein drawn adverse inferences in the hands of the assessee by merely referring to the said statement of Sh. Mukesh Choksi (supra). We though do not approve of the reliance placed by the A.O on the stand alone statement of Sh. Mukesh Choksi (supra) for drawing of adverse inferences in respect of the share transactions carried out by the assessee during the year under consideration, but rather find that even no cross examination of Sh. Mukesh Choksi (supra), whose statement was so heavily being relied upon by the A.O, was ever provided to the assessee. We find that the failure on the part of the A.O to provide cross examination of the person, relying on whose statement adverse inferences are drawn in the hands of the assessee goes to the very root of the validity of such adverse inferences drawn in the hands of the assessee, had been looked into by the Hon’ble High Court of Bombay in the case of CIT-13 Vs. M/s Ashish International (ITA No 4299 of 2009; dated. 22.02.2011), wherein the order of the Tribunal was affirmed by the Hon’ble High Court. We thus in the backdrop of our aforesaid observations, are neither able to persuade ourselves to subscribe to the adverse inferences drawn by the lower authorities in respect of the share transactions of the assessee by referring to the stand alone statement of Sh. Mukesh Choksi, as the same as observed by us hereinabove, suffer from serious infirmities, and as such cannot be summarily accepted, nor are able to dislodge the genuineness of the purchase and sale of shares of the aforesaid 10,200 shares of M/s Talent Infoways Ltd., which we find had been duly substantiated by the assessee on the basis of material made available on record, which we find had not been dislodged by the lower authorities

Posted in All Judgements, Tribunal

Arceli Realty Limited vs. ITO (ITAT Mumbai)

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DATE: April 21, 2017 (Date of pronouncement)
DATE: May 30, 2017 (Date of publication)
AY: 2007-08
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CITATION:
S. 68 Bogus share capital: Entire law on the onus of the assessee and the department with regard to the genuineness of the share capital explained in the light of several judgements . Law on effect of not giving cross-examination to the assessee also explained

The assessee duly furnished the proof of identity like PAN, bank account details from the bank, other relevant material, genuineness of the transaction, payment through banking channel and even the source of source, therefore, the assessee has proved the conditions laid down u/s 68 of the Act. It is also noted that in spite of repeated request, the Ld. Assessing Officer did not provide opportunity to cross examine the concerned persons and even the relevant information and allegation, if any, made therein, which has been used against the assessee, was not provided to the assessee. At this stage, we add here that mere information is not enough rather it has to be substantiated with facts. The information may and may not be correct. For fastening the liability upon anybody, the Department has to provide the authenticity of the information to the person against whom such information is used. The principle of natural justice, demands that without confronting the assessee of such evidence, if any, or the information, no addition can be made. Even otherwise, as per Article-265 of the Constitution of India, only legitimate taxes has to be levied and collected

Posted in All Judgements, Tribunal