2017-TIOL-1777-HC-DEL-MISC + Story
SALASAR SYNTHETICS Vs UoI : DELHI HIGH COURT (Dated: September 1, 2017)
CGST - Challenge to vires of Rule 44A of CGST Rules, 2017 - Prima facie case for interim relief - balance of convenience in favour of petitioner - no coercive action to be taken for reversal of credit: High Court [para 4]
Matter listed
2017-TIOL-1776-HC-P&H-IT
SUB-REGISTRAR, BHIWANI Vs DIT : PUNJAB AND HARYANA HIGH COURT (Dated: May 18, 2017)
Income Tax - Sections 271FA & 275(1)(c).
Keywords: Annual Information Returns - Documentary evidence - Reasonable cause & Time barred order.
The Assessee, a Sub-Registrar, was posted at Bhiwani and is engaged in registration of sale deeds and various other activities assigned by the State Government as well as the Deputy Commissioner in the District. As per 2005 amendment, the Registrar or Sub Registrar appointed under Registration Act, 1908 was required to file Annual Information Returns for transactions of purchase or sale by any person of immovable property valuing Rs. 30 lakhs or more. The Assessee failed to furnish the Annual Information Returns within the stipulated time frame, for which penalty was levied u/s 271FA of the Registration Act, 1908. The Director of Income Tax (CIB) observed that there was a delay in filing Annual Information Returns for 5 consecutive F.Ys. Meanwhile, a copy of provisional receipt for the financial year 2007-08 along with a written reply stating the reasonable cause for not filing the Annual Information Returns in time was filed by the Assessee. However, the Director of Income Tax (CIB), held that the Assessee was liable for penalty u/s 271FA for the financial years under consideration.
The Assessee preferred an appeal before the CIT(A), whereby, penalty up to the date of service of first notice was cancelled and for the remaining period the same was sustained. The Tribunal had attended only the first ground and dismissed the Assessee's appeal. Therefore, a miscellaneous application was filed by the Assessee seeking rectification of the order passed by the Tribunal. Subsequently, the said application was also dismissed by the Tribunal.
On appeal, the High Court held that,
Whether when Assessee fails to establish any bonafide in not filing the Annual Information Returns within time, inspite of the fact that he holds a very responsible post, attracts penalty u/s 271FA - YES: HC
++ the matter is no longer res integra. The issue involved in the present appeals stands concluded against the Assessee. In the present case, it has been categorically recorded by the Tribunal that the Assessee had not established any reasonable cause for not filing Annual Information Returns within time. The Assessee also failed to file any documentary evidence supporting the version submitted by him. Thus, the Tribunal rightly held the penalty levied to be valid.
Whether if it could not be shown that an order is beyond limitation as the same is hit by Section 275(1)(c) and no error in the findings recorded by the Tribunal could be established, no substantial question of law arises - YES: HC
++ counsel for the Assessee was unable to demonstrate that when SCN was issued on 06.9.2010 asking the filer to show cause as to why penalty u/s 271FA be not imposed and the reply was sought by 27.7.2010, the order imposing penalty u/s 271FA having been passed on 06.01.2011, it could not be shown that the order was beyond limitation as it was hit by Section 275(1)(c). No error in the findings recorded by the Tribunal could be established or it could not be successfully controverted regarding the applicability of the decision rendered in the Joint Registrar, Sangat, District Bathinda’s case. Thus, no substantial question of law as claimed in these appeals arises. Consequently, the appeals stand dismissed.
Assessee's appeal dismissed
AARTI DRUGS LTD Vs DESIGNATED AUTHORITY: DELHI HIGH COURT (Dated: August 29, 2017)
Cus - ADD on Metronidazole - Prima facie case exists in favour of petitioner for continuation of Anti-dumping duty - Sun Set Review to be initiated; ADD to be continued - Court directs that the ADD that was initiated by Notification No.40/2012 dated 31st August, 2012 will continue till the conclusion of the SSR initiated by the Central Government on the direction of this Court - Continuation of the ADD will be only till such time, the SSR continues and in any event will not exceed the one year period stipulated in the 2nd Proviso to Section 9A(5) of the CTA - If the SSR concludes earlier than one year, obviously, the ADD will not continue beyond that - Consequential notification in terms of this order to be issued: High Court [para 16, 18, 20, 21]
Application disposed
2017-TIOL-1774-HC-MAD-CUS
DAMODAR TRADE LINKS PVT LTD Vs CC : MADRAS HIGH COURT (Dated: August 21, 2017)
Cus - an SCN was issued to the petitioner-assessee, which is challenged as being prejudiced, invalid and lacking jurisdiction - The petitioner also claimed to have been impleaded into the matter without enquiry or investigation, resulting in harassment - Such SCN was also called vague, as it omitted to mention the exact specific provision of law applicable on the petitioner.
Held - the impugned proceedings only involve service of an SCN, and not an order - Besides, the issues convassed by the petitioner are mixed questions of fact and law - Upon a cursory perusal of the rather voluminous SCN, it is clearly based upon an investigation carried out by the DRI - Thereby, the factual issues such as whether or not the exporters made any allegation against the petitioners or whether the petitioner acted bonafidely, in purchasing scrips from the exporters, are better raised before the adjudicating authority, rather than in the present writ - Moreover, the application of Section 28 or 28AAA requires delving into facts, and so could be better resolved by the adjudicating authority - Hence the present writ is not maintainable: High Court (Para 2,3,7,8,9)
Writ petition dismissed
2017-TIOL-1773-HC-MAD-CUS
BHARATH MARINE COMPANY Vs CC : MADRAS HIGH COURT (Dated: August 24, 2017)
Cus - an SCN was issued to the petitioner-assessee, under Regulation 20(1) of the CBLR, 2013 - The jurisdiction of such SCN was challenged on grounds that a notice had already been served earlier for the same period, making the same allegations - The earlier SCN was successfully challenged via a Writ, wherein it was held that no purpose would be served by filing a reply to SCN, as the department had already prejudiced itself against the petitioner, thereby rendering to nullity the exercise of replying to the SCN - Whether a second SCN could be served, based upon grounds identical to an earlier SCN, against which a Writ petition was pending adjudication and a stay order was in effect thereof.
Held - the existence of the Writ filed against the earlier SCN is not disputed by the department - Hence the impugned SCN has no validity in law: High Court (Para 2,3,4,5)
Writ petition allowed
2017-TIOL-1223-ITAT-KOL
ADVANCE POWERINFRA TECH LTD Vs DCIT : KOLKATA ITAT (Dated: August 23, 2017)
Income tax - Sections 143(3) & 271(1)(c)
Keywords - creditworthiness of share applicant - genuineness of transaction - discrepancies in premium amount - unexplained income - levy of penalty
The Assessee company, engaged in the business of distribution of transformers, had filed its return declaring income of Rs. 29,56,766/-. During assessment, the examination of Assessee's balance sheet revealed that Assessee had received share application money on premium of Rs.40/- totaling to worth Rs.1.25 crore. Consequent to the same, the Assessee was asked to submit necessary evidence with regard to genuineness and creditworthiness of the share applicant. Further, the AO noted some discrepancies in the premium amount charged by Assessee as per ledger a/c to the information submitted to ROC. In the light of aforesaid facts, the AO was left with no alternative than to consider that the share application money for Rs.1.30 crore as per ledger a/c. said to have been received from different persons during the year were unexplained income, since Assessee had failed to establish the genuineness & creditworthiness of the transaction. In such circumstances, Rs.1,30,00,000/- was added to the total income of Assessee in addition to levy of penalty u/s 271(1)(c). On appeal, the CIT(A) confirmed the addition.
On appeal, the ITAT held that,
Whether merely furnishing PAN Numbers in routine way, will not discharge Assessee from explaining the source or creditworthiness of the 'lender' - YES: ITAT
++ the counsel for Assessee has vehemently submitted that the assessee has discharged the burden of proof that lay on it in proving the identity, creditworthiness as well as the genuineness of the transactions of receipt of share capital, at a premium from a number of Private Limited Companies. He submitted that the identity of the applicants was proved as they are all registered companies having certificate of incorporation and that all the statements were filed. He further submitted that the evidence of source was provided by furnishing PAN Number of the share applicants and as the transactions were cheque transactions, the genuineness of the transactions is proved;
++ however, it is to be noted that merely furnishing PAN Numbers in routine way, does not explain the source or the creditworthiness of the party. The basis on which premium has been charged for the shares has not been explained. A perusal of the financial statements do not justify the quantum of share premium charged. This Tribunal in the case of M/s. Blessings Commercial Pvt. Ltd, for the A.Y 2010-11, has confirmed the addition u/s 68 on the ground that the assessee has not proved the genuineness of the transaction for charging exorbitant quantum of share premiums. Therefore, applying the propositions of law laid down in the case of M/s. Blessings Commercial Pvt. Ltd, we uphold the order of CIT(A).
Assessee's appeal dismissed
