2020-TIOL-143-HC-KAR-IT

Swabhimani Souharda Credit Cooperative Ltd Vs GoI

Whether a 'co-operative society' registered under the Karnataka Souharda Sahakari Act, 1997, holds same meaning as 'co-operative society' enacted u/s 2(19) of the Income Tax Act - YES: HC

Whether the object of Section 80P of the Income Tax Act, 1961 must be constructed liberally - YES: ITAT

- Assessee's petition allowed: KARNATAKA HIGH COURT

2020-TIOL-141-HC-DEL-IT

Ravinder Kumar Vs ITO

Whether in the absence of cogent explanation and documentary evidence to support assessee's contentions, addition for unexplained cash deposited u/s 68 should be upheld - YES : HC

- Assessee's appeal dismissed: DELHI HIGH COURT

2020-TIOL-122-ITAT- DEL

Emmar MGF Construction Pvt Ltd Vs ACIT

Whether in absence of evidence regarding inflation of construction cost, the AO cannot alter the percentage indicated by the assessee on the mere grounds that the estimated cost of the housing project is less than the one declared in the books - YES: ITAT

Whether in absence of evidence regarding inflation of purchases & rejection of the books of account, the AO cannot legally on one hand recompute the profits based on the estimated project cost of construction by adopting the POCM & accept the account on another hand - YES: ITAT

Whether obligations arising under the collaboration agreement to part away with portion of sales proceeds to the holding company before income accrues to the subsidiary company is creation of superior title & diversion of income by overriding title & does not amount to application of income - YES: ITAT

- Assessee's appeals allowed: DELHI ITAT

2020-TIOL-115-ITAT- CUTTACK

Dr Subash Chandra Jena Vs ACIT

Whether penalty imposed u/s 271(1)(c) pursuant to search proceedings, is sustainable, where the assessee is found to have concealed particulars of income & where such additional income was likely to not be discovered unless for the search proceedings - YES: ITAT

Whether penalty imposed in respect of a different AY is unsustainable, where neither penalty notice nor order mention the specific charge u/s 271(1)(c) which is being invoked - YES: ITAT

-Assessee's appeal partly allowed : CUTTACK ITAT

2020-TIOL-114-ITAT-DEL

Kiran Nadar Vs DCIT

Whether an assessee can seek to revise the value of jewellery declared in wealth tax returns, where the true value of the jewellery stands established through orders of the High Court, passed in respect of mis-declaration of value by the jeweller during purchase of jewellery by the assessee - NO: ITAT

-Assessee's appeal partly allowed : DELHI ITAT

2020-TIOL-113-ITAT-DEL

Tara Alloys Ltd Vs ITO

Whether re-assessment proceedings can be sustained where approval for the same has been accorded in a mechanical manner without due application of mind - NO: ITAT

-Assessee's appeal partly allowed : DELHI ITAT

2020-TIOL-112-ITAT-MUM

Exind Trading Pvt Ltd Vs ITO

Whether it is fit case for remand where certain submissions in respect of share premium received by a company, were not canvassed before the AO & where the AO is required to look into the possibility of misuse of corporate veil in such transactions - YES: ITAT

-Case remanded : MUMBAI ITAT

2020-TIOL-140-CESTAT-BANG

Gemini Software Solutions Pvt Ltd Vs CCE,C & ST

ST - The assessee-company is engaged in providing services relating to information technology and is exporting the said services overseas and receiving consideration in convertible foreign exchange - During the disputed period, the assessee exported various taxable services for the purpose of providing and exporting taxable output service, the assessee received various input services from several service providers on which input services tax was paid - As the assessee was unable to utilize the CENVAT credit, it filed the refund claim of unutilized CENVAT credit in terms of Rule 5 of the CCR, 2004 - Thereafter, the Revenue issued an SCN alleging that proof of debit of the amount claimed as refund was not submitted, invoices to the extent of some amount were not submitted, that Service Tax registration numbers of vendors was not mentioned on invoices and also alleged other minor discrepancies- Accordingly, the SCN proposed to reject the refund application - The adjudicating authority rejected the entire refund claim on the ground that the assessee was not eligible to credit and that proof of debit of the amount was not submitted - Such findings were sustained by the Commr.(A) - Hence the present appeal.

Held - The rejection of refund on grounds of ineligibility is not sustainable, in view of the settled law at the time of refund and so the eligibility for the same cannot be questioned - Considering the decision in K Line Ship Management (India) Pvt. Ltd. Vs CST, Mumbai it is not open to the Department to examine the eligibility to Cenvat credit while adjudicating the refund application, since in such matters of admissibility, the Department is mandated to take recourse u/r 14 of CCR - Further, the rejection of the entire refund claim only on ground of violation of Condition H of Notfn No 27/2012 is not sustainable - Since the assessee debited the cenvat a/c but only after filing the refund claim - Debiting the cenvat a/c subsequent to filing of refund claim is only a procedural violation which cannot defeat the substantive right of the assessee to claim refund u/r 5 of CCR 2004 - It is settled law laid down in Kony Labs IT Services Pvt. Ltd. Vs CCE, Hyderabad-IV that debiting the Cenvat account subsequent to filing the refund will not defeat the substantive right of the assessee - Hence the O-i-A is unsustainable - The assessee is also entitled to interest in terms of Section 11BB of the CEA 1944, in keeping with the decision of the Apex Court in Ranbaxy Laboratories Ltd. Vs UOI : CESTAT

-Assessee's appeal allowed : BANGALORE CESTAT

2020-TIOL-139-CESTAT-HYD

CC & CE Vs Sri Vasavi Polymers Pvt Ltd

CX - Valuation - Section 4 of the CEA, 1944 - Related person - Rule 10 of Valuation Rules ibid requires that the entire sales should be made through the related person whereas, in the case on hand, the Revenue has not been able to dislodge the findings of the Adjudicating Authority that the sales through M/s. Vasavi Agencies could constitute only 25% to 30% of the total sales as also the fact that the assessee was effecting sales at the factory gate to other buyers as well - Bench also finds that the Adjudicating Authority has placed on record, as "verified from the records that the sales through or to M/s. Vasavi Agencies constitute 25% to 30% (on value volume) and the remaining sales are to independent buyers and to Government bodies" - This clear and categorical finding based on the verification of records has not at all been challenged by the Revenue - Bench has no option but to accept the well-reasoned findings of the Commissioner: CESTAT [para 9]

CX - Valuation - Section 4 of the CEA, 1944 - Related person - From a conjoint reading of Section 4(3)(b) of the CEA and Section 2(g) of the MRTP Act, the Revenue is expected to clearly establish the relation as to inter-connection first, for which a little extra enquiry/investigation would be necessary - To establish the above, they have to place on record the complete shareholding pattern, the management pattern, the exercise of control by one over the other, etc., which are not there either in the Show Cause Notice or even in the grounds of the Revenue's appeal - So also, Rule 10 (a) would apply only if such clause is specified in the Show Cause Notice under which the alleged relationship fitted - This is also for the reason that if the alleged relationship does not fit in under Clauses (ii), (iii) or (iv), then Section 4(1) has to be adopted - no reason to interfere with the reasoned findings given by the Adjudicating Authority in the impugned order and the same is, therefore, upheld - Revenue appeal is dismissed: CESTAT [para 10 to 12]

-Appeal dismissed : HYDERABAD CESTAT

2020-TIOL-135-HC-MUM-CUS

Ramanlal Jagannath and Sons Vs CC

Cus - An SCN had been issued to the assessee, raising demand for duty with interest, which allegedly had been short levied, in respect of a certain consignment - Apparently, the goods imported such as Kapok and other vegetable fibres were to be assessed under Entry 53.05 whereas the assessee classified the same under Entry 52.01, which according to the Revenue was not correct - Hence provisions of Section 28 of the Customs Act had been invoked - Such proposals in the SCN were confirmed upon adjudication - On appeal, the Commr.(A) held that Kapok has not undergone any treatment indicating that their use as textile material & could not be classified under heading 53.05 - The Commr.(A) also rejected the assessee's contention and held that the items were classifiable under Entry 14.04 - On further appeal, the Tribunal remanded the matter to the Commr.(A) to ascertain as to whether Kapok was used primarily for manufacturing of textile - Hence the present appeal.

Held - There is no finding as to whether the observations of the Commr.(A) that Kapok could not be classified under Heading 53.05 is correct or not - No appeal was filed by the Revenue on this count - The question remains as to whether the Kapok could be classified under Heading 14.04 - The argument that the Commissioner (Appeals) in the appeal can never look into a different entry is belied by the proviso to Section 128A of the Act - But then a procedure has been laid down in the proviso, wherein a prior notice and time limit has been contemplated - The assessee's contention that such notice even if issued, was beyond time even on the date the Commissioner passed the order, can also be raised before the Commr.(A) in the remand proceedings - Hence no substantial question of law arises herein: HC

- Assessee's appeal dismissed: BOMBAY HIGH COURT

2020-TIOL-138-CESTAT-AHM

Awin Exim Company Vs CC

Cus - Appeals have been filed by M/s. Awin Exim Company [appellant], its partner Shri Satish Choudhary and by Shri Subhash Choudhary, Power of Attorney holder, against the change of classification and confiscation of goods imported by them and imposition of penalties.

Held: The appellant is a unit in KASEZ having Letter of Permission to manufacture garments - for the purpose of said manufacturing, they are entitled to import various fabrics without payment of duty - the allegation of Revenue is that while the appellant had declared that the goods imported by them are falling under Chapter heading 5407 but some of the goods were woven fabric falling under Chapter heading 6001 - while making these imports, the appellant would not have gained any monetary benefit as no duty is involved - the appellant has not contested confiscation of the goods and abandoned the goods - in these circumstances, the penalty of Rs.3 lakh imposed on the appellant under section 112 of Customs Act, 1962 is excessive and the same is reduced to Rs.1.5 lakh - in terms of decision of the Gujarat High Court in the case of Jai Prakash Motwani - 2009-TIOL-121-HC-AHM-CUS , when penalty is imposed on partnership firm, penalty cannot be imposed on its partner - in view of this, penalty imposed on Shri Satish Choudhary, Partner of the appellant firm is set-aside - Shri Subhash Choudhary, POA has not appeared to answer the summons and his role is relatively limited and keeping in view the fact that Shri Subhash Choudhary would not have gained any monetary benefits, the penalty of Rs.2 lakh is excessive and the same is reduced to Rs.1 lakh - the appeal of Shri Satish Choudhary, partner is allowed - appeals of M/s. Awin Exim Company and Shri Subhash Choudhary are partly allowed: CESTAT [para 6, 7, 8, 9]

-Appeals disposed of : AHMEDABAD CESTAT