Search Results For: G. S. Kulkarni J


CIT vs. Oryx Finance and Investment Pvt. Ltd (Bombay High Court)

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DATE: July 1, 2017 (Date of pronouncement)
DATE: July 6, 2017 (Date of publication)
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S. 221: A reading of s. 221 conjointly with the definition of “tax” in s. 2(43) leads to the irresistible conclusion that the phraseology “tax in arrears” in s. 221 would not take within its realm the interest component. The AO can impose penalty for default in making the payment of tax, but the same shall not exceed the amount of tax in arrears. Tax in arrears would not include the interest payable u/s 220(2) of the Act

Reading Section 221 in its entirety, it is abundantly clear that the aspect of default in payment of tax and the amount of interest payable are treated as distinct and separate components. The section categorically and specifically states that when an Assessee is in default or is deemed to be in default in making payment of tax, he shall in addition to the amount of arrears and the amount of interest payable under SubSection 2 of Section 220, be liable, to pay penalty, however the amount of penalty does not exceed the amount of tax in arrears. The terminology “default in making a payment of tax and amount of interest payable” are considered to be separate for imposition of penalty and penalty is to be levied on account of default in making a payment of tax. However, the total amount of penalty shall not exceed the amount of tax in arrears. The said penalty for non payment of the tax is in addition to the levy of interest under SubSection 2 of Section 220. Under no principle of interpretation, the arrears of tax as laid down in the said Section would include the amount of interest payable under SubSection 2 of Section 220. The amount of penalty will have to be restricted on the arrears of tax, which would not include the interest component charged under Section 220(2) of the Act

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CIT vs. Aurionpro Solutions Ltd (Bombay High Court)

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DATE: June 9, 2017 (Date of pronouncement)
DATE: June 30, 2017 (Date of publication)
AY: 2007-08
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CITATION:
Transfer Pricing ALP of foreign advances: If the advances are made to a AE situated abroad, the LIBOR rate has to considered to determine the Arms Length interest and not the interest rate in India (SBI PLR). This would be reasonable and proper in applying commercial principles

Advances were made to the company situated abroad. The LIBOR rate naturally will be considered to determine the Arms Length interest, the same would be reasonable and proper in applying the commercial principle. The Tribunal has directed the appropriate rate would be LIBOR plus 2% instead of LIBOR plus 3% applied by the TPO

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CIT vs. Mettler Toledo India Pvt. Ltd (Bombay High Court)

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DATE: June 7, 2017 (Date of pronouncement)
DATE: June 21, 2017 (Date of publication)
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S. 92C +/- 5%: The contention that there is an error because mere mathematical calculation shows that the arm's length purchase price as worked out by the TPO falls beyond (+)/(-) 5% range and consequently falls outside the scope of the second proviso to s. 92C(2) cannot be considered if it was not raised before the CIT(A) & ITAT

Whether on the facts and circumstances of the case and in law, the ITAT is correct in directing the Assessing Officer to allow benefit of +/5% to the assessee without considering Explanation (2A) to Section 92C(2) inserted by Finance Act 2012 w.e.f. 1.4.2002, whereby deduction of 5% earlier being allowed by appellate authorities has been explicitly prohibited w.e.f. 1.4.2002 and therefore, the ITAT ought not to have issued such directions to the A.O. as are in contravention of the provisions of the statute

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Adv. Manoj Laxman Shirsat vs. Bar Council of India (Bombay High Court)

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DATE: March 30, 2017 (Date of pronouncement)
DATE: March 31, 2017 (Date of publication)
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Strike by Advocates: Giving a call to protest when the Bill is still at a draft stage is premature. Wisdom has to prevail on the Advocates in the light of the law laid down in Harish Uppal AIR 2003 SC 739. The law laid down by the Supreme Court is binding on the Advocates as well under Article 141 of the Constitution. The lawyers' community has to appreciate their responsibility in discharging the duties of their profession

If one has to understand the implication or consequences of abstaining from work in general terms, the strike would mean abstaining from work apart form other meanings. It is nothing but demonstration of protest against the suggestions or resolution denying in line with the demand. It can also mean temporary stoppage of activities in protest against any act or a condition imposed. Petitioners’ counsel also rely upon the order dated 5th December 2016 passed in Contempt Petition (C) No.19/2016 in Writ Petition (C) No.132/1988 (Prem Prakash Panigrahi v. Md.Shabbir Ahmed and others) on the file of the Apex Court so also the judgment of the Division Bench of this Court dated 27th October 2014 passed in PIL No.75/2014 (Adv.Manoj Laxman Shirsat v. Bar Council of Maharashtra and Goa). The observations in the case of Capt. Harish Uppal v. Union of India (supra) indicate that the proceedings inside the Court are always expected to be held which commands confidence of the public in the efficacy of the institution of the Courts. In the said decision, the Apex Court has also referred to the duties, obligations, responsibilities and the divine work of the community of the lawyers while discharging their professional duties

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CIT vs. Techno Tarp and Polymers Pvt. Ltd (Bombay High Court)

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DATE: December 5, 2015 (Date of pronouncement)
DATE: November 1, 2016 (Date of publication)
AY: 2009-10
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S. 10A/10B: After the change in scheme from “exemption” to “deduction” w.e.f. 01.04.2001, brought forward unabsorbed loss & depreciation of other 10B units and non-10B units are not liable for set off against the current year's profit of the 10B unit. The contrary law laid down in Himatasingike Seide 156 Taxman 151 (Kar), as approved by the Supreme Court, deals with the law pre 01.04.2001 when s. 10A/10B provided for an “exemption” and not a “deduction”

We find that the decision of the Karnataka High Court in Himatasingike Seide Ltd. (supra) which was undisturbed by the Apex Court was in respect of Assessment Year 1994-95. Thus it dealt with the provisions of Section 10B of the Act as existing prior to 1 April 2001 which was admittedly different from Section 10B as in force during Assessment Year 2009-10 involved in this appeal. Section 10B of the Act as existing prior to 1 April 2001 provided for an exemption in respect of profits and gains derived from export by 100% Export Oriented Undertakings and now it provides for deduction of profits and gains derived from a 100% Exported Oriented Units

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DIT vs. Citibank N. A. (Bombay High Court)

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DATE: March 11, 2015 (Date of pronouncement)
DATE: July 8, 2016 (Date of publication)
AY: 1999-00
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Law laid down by the Tribunal in (i) Central Bank of India v/s. DCIT 42 SOT 450 that under Art 26(3) of India-USA DTAA payments to Non-Residents are equated with payments to Residents & so s. 40(a)(i) disallowance is not valid and (ii) in DCIT v/s. Bank of Baharain & Kuwait 132 TTJ (Mum) 505 that loss arising from unmatured foreign exchange contracts is not a notional loss but is allowable as a definite liability is final as Dept has not challenged these verdicts and the issue cannot be raised in case of other assessees

The Assessee during subject Assessment Year made payment through Master Card International and Visa Card International being assessment and equipment fees. The payments were made by the Assessee without deducting tax at source. In view of the above, the Assessing Officer & CIT(A) disallowed the entire amount of fees remitted, aggregating to Rs.82.33 lakhs in terms of Section 40(a)(i) of the Act. The Tribunal allowed the Appeal of the Assessee by followed its decision in the case of Central Bank of India v/s. DCIT 42 SOT 450 – wherein on similar facts, it was held that even if no TDS is deducted, the payments made to Visa Card International and Master Card International on account of fees could not be disallowed in view of Article 26(3) of Indo-US Double Taxation Avoidance Agreement (DTAA)

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Larsen & Toubro Limited vs. UOI (Bombay High Court)

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DATE: March 28, 2016 (Date of pronouncement)
DATE: May 30, 2016 (Date of publication)
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Reluctance of AOs to comply with binding Court judgements leads to negative reactions amongst business entities doing business in India and hurts National pride and image. Hereafter non-compliance with orders would visit officials with individual penalties, including forfeiture of salaries

No officer is acting independently and following judgments of this Court, but waiting for the superiors to give them a nod. Even the superiors are reluctant given the status of the assessee and the quantum of the demand or the refund claim. We are sure that some day we would be required to step in and order action against such officers who refuse to comply with the Court judgments and which are binding on them as they fear drastic consequences or unless their superiors have given them the green signal. If there is such reluctance, then, we do not find any enthusiasm much less encouragement for business entities to do business in India or with Indian business entitles. Such negative reactions / responses hurt eventually the National pride and image. It is time that the officers inculcate in them a habit of following and implementing judicial orders which bind them and unmindful of the response of their superiors. That would generate the right support from all, including those who come forward to pay taxes and sometimes voluntarily. Hereafter if such orders are not withdrawn despite binding Division Bench judgments of this Court that would visit the officials with individual penalties, including forfeiture of their salaries until they take a corrective action

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CIT vs. S. Ganesh (Bombay High Court)

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DATE: March 18, 2014 (Date of pronouncement)
DATE: May 17, 2016 (Date of publication)
AY: 2006-07
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CITATION:
Inability of the assessee, an Advocate, to reconcile the professional receipts with the TDS certificates and to give a detailed party-wise breakup of fees receipts does not mean that the difference can be assessed as undisclosed income

The assessee was engaged as an Advocate to argue the matters by what is popularly known as Advocates on record or instructing Advocates method, meaning thereby the client does not engage the assessee directly but a professional or the Advocate engaged by the client requests the assessee to argue the case. The brief is then taken as the counsel brief. That being the practice, the assessee gave an explanation that the breakup as desired cannot be given and with regard to all payments. It is pointed out that at times, assessee receives fees directly from the clients or from the instructing Advocates or Chartered Accountants if such professionals have collected the amounts from the clients. Under these circumstances, the breakup as desired cannot be placed on record

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DIT (E) vs. M/s Lala Lajpatrai Memorial Trust (Bombay High Court)

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DATE: April 13, 2016 (Date of pronouncement)
DATE: April 19, 2016 (Date of publication)
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CITATION:
S. 2(15)/ 11: If the predominant purpose is charitable, the earning of profit from an incidental activity like letting of property does not affect the charitable status. As the letting is a part of the educational activities, there is no obligation to maintain separate books u/s 11(4A). As per CBDT Circular No. 11 of 2008, the first proviso to s. 2(15) applies to the 'advancement of any other object of general public utility'

The revenue’s contention that the tribunal has overlooked the provisions of section 11(4A) is unfounded. We have noted above that the service charges received in respect of 6th and 7th floor were clearly on account of educational purpose. Letting out was incidental and not the principle activity of the assessee trust. Thus, in our opinion, section 11(4A) which require separate account to be maintained would not be attracted in view of our conclusion that the said amounts as received by the assessee for the assessment year have been received from educational activity which is the dominant activity of the assessee trust. In our opinion, if this be the case, separate books of accounts cannot be insisted upon as the said activity becomes part and parcel of the educational activities carried out by the assessee trust. In such a case, the benefit of exemption under section 11 (4A) cannot be denied. An interpretation as urged on behalf of the revenue would render nugatory the very spirit, rationale and the object of the exemption provisions making the same unworkable

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CIT vs. Tata Teleservices (Maharashtra) Ltd (Bombay High Court)

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DATE: December 16, 2015 (Date of pronouncement)
DATE: January 15, 2016 (Date of publication)
AY: 2009-10 to 2012-13
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CITATION:
S. 254(2A): As the Third Proviso which restricts the power of the ITAT to grant stay beyond 365 days “even if the delay in disposing of the appeal is not attributable to the assessee” has been struck down in Pepsi Foods 376 ITR 87 (Del) as being arbitrary, unreasonable and discriminatory, the law laid down in Narang Overseas 295 ITR 22 (Bom) & Ronuk Industries 333 ITR 99 (Bom) that the ITAT has power to grant stay beyond 365 days has to be followed

The ratio of the decision of this Court in “Narang Overseas (P) Ltd.” (supra) would apply even to the substituted third proviso to Section 254(2A) of the Act. The basis of the decision in “Narang Overseas (P) Ltd.” (supra) was that the power to grant stay or interim relief has to be read as coextensive with the power to grant final relief. The object being that in the absence of the power to grant interim relief the final relief itself may be defeated. This Court thereafter followed the decision of the Apex Court in “CCE vs. Kumar Cotton Mills(P) Ltd., (2005(180) ELT 434 (SC)) and held that notwithstanding the pre-substituted third proviso to Section 254(2A) of the Act the Tribunal continues to have powers to grant interim relief. In the above view, therefore, the ratio of the decision in “Narang Overseas (P) Ltd.” (supra) would apply even in case of substituted third proviso to Section 254(2A) of the Act

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