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    Refund of excise duty paid under protest attracts Section 11B, with interest payable only after three months under Section 11BB.
    CGST proceedings against a dissolved company after merger were void for want of jurisdiction and invalid notice.
    Limitation condonation and BSNL VRS exemption: appellate relief granted, with recomputation and refund directed under tax law.
    Reassessment jurisdiction fails when approval comes from the wrong authority, rendering the reassessment unsustainable.
    Penalty under section 271DA needs recorded satisfaction and independent proof of prohibited cash receipts under section 269ST.
    Rectification powers cannot review concluded appellate orders, and adverse amendments require prior notice and hearing for validity.
    Reassessment beyond four years fails where no nondisclosure is recorded and reopening rests on a mere change of opinion.
    Fresh appellate claim, BSNL VRS exemption and limited leave-encashment relief decided under income-tax exemption rules.
    Unexplained cash deposits require source and ownership inquiry before entire bank credits can be added as income.
    Leave travel concession exemption is limited to domestic travel, and failure to deduct tax on foreign-leg payments triggers default liability.
    Prospective application of section 115BBE barred higher tax rate for surrendered receipts in the earlier assessment year.
    Warehouse supervision charges turn on actual deployment pattern; limited-hour customs supervision supports Merchant Over Time basis, not CRC.
    Inherent powers cannot quash a prima facie criminal and PMLA case where disputed facts and evidence require trial.
    Appeal limitation and delay condonation cannot be applied mechanically when the authority's own order misstates the filing period.
    Year-specific satisfaction for search assessments is necessary; a consolidated note based only on regular ledger entries cannot establish jurisdiction...
    Reassessment notice limitation: dispatch after the statutory deadline invalidates the notice and consequential reassessment order.
    Municipal-function GST exemption excludes commercial market-fee lessees, who must clear statutory dues before COVID-related lease relief.
    Unchallenged settlement deeds confer absolute title, enabling valid testamentary disposition and defeating partition claims based on unproven benami a...
    Subsequent amendments cannot invalidate Tribunal findings correctly based on binding law prevailing when the decision was made.
    Prior communication of reassessment sanction is essential; post-notice approval communication creates a jurisdictional defect in reopening proceedings...
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Refund of excise duty paid under protest attracts Section 11B, with interest payable only after three months under Section 11BB.
Duty amounts paid under protest retained the character of central excise duty, so the refund claim remained governed by Section 11B of the Central Excise Act, 1944. The Tribunal held that Section 72 of the Indian Contract Act, 1872 could not be used to bypass the statutory refund mechanism. Interest on delayed refund was held payable only under Section 11BB, and only after expiry of three months from receipt of the refund application, not from the original date of deposit. The wider claim for interest from the date of deposit was rejected, but statutory interest at 6% per annum from the post-three-month period was allowed.
AI TextQuick Glance (AI)Headnote
CGST proceedings against a dissolved company after merger were void for want of jurisdiction and invalid notice.
Proceedings under the CGST Act cannot validly be initiated against an amalgamating company after it has ceased to exist on merger, especially where the tax authority had knowledge of the amalgamation. The notice was issued in the name of a dissolved entity despite a court-approved scheme and intimation to the Department. Section 87 of the CGST Act was read as dealing only with the treatment of companies during the relevant intervening period and cancellation of registrations, not as authority to commence adjudication against a non-existent company. The notice and the consequential order were therefore void ab initio and without jurisdiction.
AI TextQuick Glance (AI)Headnote
Limitation condonation and BSNL VRS exemption: appellate relief granted, with recomputation and refund directed under tax law.
Delay in filing the first appellate appeal was condoned on a liberal limitation approach, where the assessee's bona fide ignorance of the exemption claim and the settled practice in similar BSNL VRS matters were accepted as sufficient cause. On merits, BSNL VRS-2019 compensation was held exempt under the income-tax exemption for voluntary retirement receipts, and the appellate claim was allowed despite not having been raised in the return. The Tribunal also noted that Goetze (India) did not bar relief in appellate proceedings. The Assessing Officer was directed to recompute income and grant consequential refund, if any, in accordance with law.
AI TextQuick Glance (AI)Headnote
Reassessment jurisdiction fails when approval comes from the wrong authority, rendering the reassessment unsustainable.
Reassessment jurisdiction failed where approval was not obtained from the prescribed specified authority under the reassessment scheme applicable to the relevant assessment year. For AY 2017-18, the record showed approval under section 151 from the Principal Commissioner of Income Tax, but the applicable scheme required approval from the authority prescribed for that year. Because the approval defect went to the root of jurisdiction, the reassessment proceedings and the consequent assessment were quashed.
AI TextQuick Glance (AI)Headnote
Penalty under section 271DA needs recorded satisfaction and independent proof of prohibited cash receipts under section 269ST.
Penalty under section 271DA requires a clear recorded satisfaction in the assessment order that the ingredients of section 269ST are met; without such jurisdictional satisfaction, initiation of penalty proceedings is invalid. The penalty also cannot be sustained on estimated income, seized tally data or statements alone unless the Revenue proves, with independent and transaction-wise evidence, that an identifiable person made prohibited cash receipts breaching section 269ST. Rejected books, estimated assessments and uncorroborated admissions of additional income do not by themselves establish the statutory violation. On these principles, the penalty was held unsustainable in law.
AI TextQuick Glance (AI)Headnote
Rectification powers cannot review concluded appellate orders, and adverse amendments require prior notice and hearing for validity.
Rectification under section 154 is limited to correcting mistakes apparent from the record and cannot be used to review, recall or reverse a concluded appellate order on a debatable issue. An appellate order favourable to the assessee cannot therefore be reopened through rectification. Section 154(3) also requires notice and an opportunity of hearing before an amendment adverse to the assessee; non-compliance makes the rectification ex parte and legally invalid. The adverse rectification order was consequently set aside for exceeding the statutory scope of rectification and breaching the mandatory hearing requirement.
AI TextQuick Glance (AI)Headnote
Reassessment beyond four years fails where no nondisclosure is recorded and reopening rests on a mere change of opinion.
Reassessment beyond four years under section 147 requires the recorded reasons to show failure by the assessee to fully and truly disclose material facts; absent that condition, reopening is invalid. The recorded reasons here did not allege any such failure, and the recruitment and training expense material had already been disclosed in the audited financial statements, return, and original assessment record under section 143(3). No new tangible material or external information supported the reopening, so the action rested only on re-examination of the same material. The reassessment was therefore without jurisdiction as a mere change of opinion.
AI TextQuick Glance (AI)Headnote
Fresh appellate claim, BSNL VRS exemption and limited leave-encashment relief decided under income-tax exemption rules.
A bona fide delay in filing an appeal against a 143(1) intimation was condoned because substantial justice prevailed over technicalities, and the appellate authority could entertain a fresh legal claim for exemption; the assessee's claim was therefore admitted. BSNL VRS-2019 compensation was held exempt under section 10(10B) by following earlier Tribunal rulings involving identically placed employees, so the income was to be recomputed accordingly. The enhanced leave-encashment exemption under section 10(10AA) did not apply because Notification No. 31/2023 operated only from 01.04.2023, whereas the relevant years were earlier, so that ground failed.
AI TextQuick Glance (AI)Headnote
Unexplained cash deposits require source and ownership inquiry before entire bank credits can be added as income.
Cash deposits alleged as unexplained income require inquiry into their source and ownership where surrounding facts suggest that third parties may have routed funds through the account. A blanket addition of the entire deposits is not justified without examining deposit and withdrawal patterns, confronting the taxpayer with deposit details, and allowing available third-party particulars to be produced. Fresh adjudication should also consider any properly raised peak-credit claim. The additions were vacated for the time being and remanded for de novo assessment with an opportunity of hearing.
AI TextQuick Glance (AI)Headnote
Leave travel concession exemption is limited to domestic travel, and failure to deduct tax on foreign-leg payments triggers default liability.
Leave travel concession exemption under section 10(5) read with Rule 2B applies only to travel from one place in India to another by the shortest route, and it does not extend to journeys involving a foreign leg. On the facts, no binding interim judicial protection excused the employer from deducting tax during the relevant period, so the statutory duty under section 192 continued to apply. Failure to deduct tax therefore attracted treatment as an assessee in default under section 201(1), with interest under section 201(1A) following as a consequential liability. The ITAT upheld the demand arising from non-deduction on the impugned LFC payments.
AI TextQuick Glance (AI)Headnote
Prospective application of section 115BBE barred higher tax rate for surrendered receipts in the earlier assessment year.
Enhanced tax under section 115BBE applies prospectively from assessment year 2018-19 and cannot be applied to assessment year 2017-18. The surrendered amount, disclosed as professional receipts, was therefore taxable only at the normal rate, and the Revenue's attempt to apply the higher rate failed in favour of the assessee.
AI TextQuick Glance (AI)Headnote
Warehouse supervision charges turn on actual deployment pattern; limited-hour customs supervision supports Merchant Over Time basis, not CRC.
Recovery of supervision charges for a special bonded warehouse depends on the frequency, duration and nature of customs officer deployment under Regulation 3(e) of the Special Warehouse Licensing Regulations, 2016 and Circular No. 32/2016-Cus. Cost Recovery Charges apply only where officers are deployed for the whole day, the better part of the day, or comparable continuous supervision. Where the record shows only limited-hour supervision and no corroborative evidence of full-day or better-part-of-day deployment, the proper basis is Merchant Over Time charges. On those facts, a CRC-based demand is unsustainable and the charges must align with actual usage.
AI TextQuick Glance (AI)Headnote
Inherent powers cannot quash a prima facie criminal and PMLA case where disputed facts and evidence require trial.
Section 482 CrPC relief was declined because the allegations disclosed a prima facie case and the issues turned on disputed facts and evidence. The subsequent committee report on damages did not extinguish the criminal case or the PMLA complaint, as its relevance and admissibility were matters for trial. Proceedings against the women accused were also not quashed, since the record prima facie showed their connection with the quarrying concern during the relevant period. Delay, alleged mala fides, and challenges to witness statements did not justify quashing, and the PMLA prosecution remained maintainable despite disputes over the predicate offences.
AI TextQuick Glance (AI)Headnote
Appeal limitation and delay condonation cannot be applied mechanically when the authority's own order misstates the filing period.
An appeal under section 85 of the Finance Act, 1994 must ordinarily be filed within two months, with a further condonable period of one month on sufficient cause. Where the Order-in-Original itself wrongly states that the appeal lies within three months, the assessee may reasonably be misled into filing without a condonation application. The Commissioner (Appeals) should not dismiss such an appeal mechanically without examining whether the procedural lapse was caused by the authority's own misstatement. In the reported matter, the dismissal of the first appeal was held unsustainable and the case was remanded for consideration of delay condonation and decision on merits.
AI TextQuick Glance (AI)Headnote
Year-specific satisfaction for search assessments is necessary; a consolidated note based only on regular ledger entries cannot establish jurisdiction.
Section 153C jurisdiction requires a separate, year-specific satisfaction note for each relevant assessment year. A consolidated note covering multiple years does not meet that requirement where it fails to record distinct satisfaction for each year. Regular ledger entries and ordinary books of account, without an explanation of their incriminating character, do not establish the necessary jurisdictional foundation. Reliance on a consolidated satisfaction note based solely on such ledger material therefore invalidates the assumption of jurisdiction.
AI TextQuick Glance (AI)Headnote
Reassessment notice limitation: dispatch after the statutory deadline invalidates the notice and consequential reassessment order.
Reassessment notices must be issued and dispatched within the prescribed limitation period; signing the notice before the deadline is insufficient where issuance and dispatch occur after it. A notice signed on 31 March 2021 but issued and dispatched on 1 April 2021 was therefore time-barred and invalid. Because the consequential reassessment order rested entirely on the invalid notice, it could not survive and was likewise invalid.
AI TextQuick Glance (AI)Headnote
Municipal-function GST exemption excludes commercial market-fee lessees, who must clear statutory dues before COVID-related lease relief.
GST exemption for municipal functions under Article 243W applies to services rendered by local authorities, not to an auction lessee commercially collecting weekly-market fees under tender conditions. Such collection arises from a contractual commercial right, and the contractor remains liable for applicable Central and State taxes. COVID-related lease waiver or refund of lease amounts and security deposit is not unconditional where GST and income-tax liabilities remain unpaid. Tender terms may permit adjustment of losses or expenditure against amounts payable to the licensee, requiring statutory dues to be cleared before lease-related relief or refunds are claimed.
AI TextQuick Glance (AI)Headnote
Unchallenged settlement deeds confer absolute title, enabling valid testamentary disposition and defeating partition claims based on unproven benami allegations.
Unchallenged settlement deed confers absolute title on the testatrix where no relief is sought to set it aside, preventing a partition claim founded on an alleged benami purchase. A testamentary disposition made by the absolute owner governs succession to that property. Due execution and attestation of a registered Will require compliance with the statutory requirements for execution and proof through attesting-witness evidence. Alleged suspicious circumstances, including age, health, place of registration, or the executor's role, do not invalidate the Will unless supported by acceptable evidence. Registration at the testatrix's residence alone does not create suspicion.
AI TextQuick Glance (AI)Headnote
Subsequent amendments cannot invalidate Tribunal findings correctly based on binding law prevailing when the decision was made.
Subsequent amendment to the proviso to Section 147A cannot retrospectively fault a Tribunal decision that correctly applied the law prevailing when it was made. Where jurisdictional High Court rulings governed the issue at that time and the Tribunal's finding was supported by the record, the later amendment does not create a substantial question of law or invalidate that decision. The Revenue's reliance on the subsequent legislative change therefore fails.
AI TextQuick Glance (AI)Headnote
Prior communication of reassessment sanction is essential; post-notice approval communication creates a jurisdictional defect in reopening proceedings.
Statutory sanction under Section 151 must be communicated to and received by the Assessing Officer before issuance of a reassessment notice under Section 148. An undated approval endorsement, coupled with evidence that approval reached the Assessing Officer only after the notice was issued, establishes that the notice preceded effective sanction. This constitutes a fundamental jurisdictional defect, invalidating the reopening proceedings and consequential reassessment under Sections 143(3) and 147. A jurisdictional objection on this point may be raised where the relevant facts are already available on record.

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1995 (9) TMI 94 - AT - Income Tax

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Validity of reassessment upheld based on loan transaction doubts; ITAT affirms CIT (A) decision.
The ITAT upheld the validity of the reassessment proceedings initiated by the Assessing Officer under section 147(b) based on information received from ... Summary

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Acts Income Tax