TaxTMI Updates e-Newsletter
Oct 07,2022

Appealability under Section 107 of the Central Goods and Services Tax Act, 2017 - condonation of delay in filing statutory appeal - stay of recovery by deposit of 10% of disputed tax under sub-sections 6 and 7 of Section 107 - refund of amount recovered in excess of statutory deposit - direction to Appellate Authority to decide application in accordance with law and pass a speaking order after hearing

Appealability under Section 107 of the Central Goods and Services Tax Act, 2017 - condonation of delay in filing statutory appeal - stay of recovery by deposit of 10% of disputed tax under sub-sections 6 and 7 of Section 107 - Impugned order dated 17.06.2022 is appealable under Section 107 of the GST Act and the statutory scheme permits condonation of delay; deposit of 10% of the balance disputed tax operates to deem the balance stayed. - HELD THAT: - The Court recorded the parties' concession and observed that the impugned order falls within the appellate jurisdiction under Section 107 of the Central Goods and Services Tax Act, 2017 and that the statute provides for condonation of delay in filing the appeal. The Court noted the legal effect of sub-sections (6) and (7) of Section 107 that, upon deposit of an amount equal to 10% of the remaining tax in dispute, the balance shall be deemed stayed. On the admitted facts the respondent had already recovered more than the statutory 10% shortly after passing of the impugned order. The petition was disposed by granting liberty to the petitioner to file the statutory appeal notwithstanding delay, to avail the condonation and deposit provisions as available under law.

Petitioner permitted to file an appeal under Section 107 along with appropriate application for condonation and consideration of statutory deposit; liberty granted despite delay.

Refund of amount recovered in excess of statutory deposit - direction to Appellate Authority to decide application in accordance with law and pass a speaking order after hearing - Whether the Appellate Authority should consider the factual contention that recovery already made exceeds the statutory 10% deposit and, if satisfied, order refund of the excess amount. - HELD THAT: - The Court refrained from expressing any opinion on merits and instead directed that the Appellate Authority, upon receipt of the appeal and the appropriate application, shall consider the factual claim that recovery effected by the respondent exceeds the statutory deposit threshold. The Appellate Authority is to decide that application in accordance with law, after affording opportunity to the parties, and to pass a reasoned (speaking) order. The Court's direction effectively remands the factual determination and any consequential refund to the competent Appellate Authority for fresh consideration.

Appellate Authority to consider the petitioner's application about recovery in excess of 10%, decide it in accordance with law after hearing the parties, and pass a speaking order; matter remanded for fresh consideration on that factual issue.

Final Conclusion: Petition disposed by permitting the petitioner to file the statutory appeal despite delay; the Appellate Authority is directed to consider the application regarding compliance with the deposit requirement and any claim for refund of amounts recovered in excess of the statutory deposit, and to pass a reasoned order after giving the parties an opportunity of hearing.

Article 21 - right to livelihood - extension of limitation for filing appeal - relief from strict compliance with procedural/formal requirements in appeals against GST registration cancellation - direction to reconsider appeals excluding limitation bar - GST registration cancellation and entitlement to continue business

Article 21 - right to livelihood - GST registration cancellation and entitlement to continue business - Whether petitioners who lost GST registration are entitled to equitable relief permitting filing of appeals despite procedural non-compliance, on the ground that cancellation deprives them of livelihood under Article 21. - HELD THAT: - The Court accepted that cancellation of GST registration prevents the petitioners from continuing their business and thereby affects their livelihood, engaging the protection under Article 21. Reliance was placed on consistent High Court decisions cited by the petitioners, and the respondent did not dispute those legal propositions. In view of the deprivation of the right to livelihood and the precedents referred to, the Court found that hyper-technical insistence on procedural/formal non-compliance (hard-copy submission or delayed filing) would produce an unjust result. Accordingly, the order impugned in Poonamchand Saran (dated 09.09.2022) was set aside and equitable relief was granted permitting filing of appeals despite the procedural/limitation bar.

Order dated 09.09.2022 set aside; petitioners granted relief to file appeals notwithstanding procedural/non-compliance on grounds of protection of livelihood under Article 21.

Extension of limitation for filing appeal - direction to reconsider appeals excluding limitation bar - relief from strict compliance with procedural/formal requirements in appeals against GST registration cancellation - Whether the competent authority should be directed to entertain and decide the appeals filed by the petitioners despite delay or failure to file hard copies, and on what terms such reconsideration should take place. - HELD THAT: - The Court afforded both petitioners liberty to file appeals against cancellation within ten days and directed the competent authority to consider and decide those appeals on all aspects in accordance with law, expressly excluding the bar of limitation. This amounted to remanding the matter for fresh consideration on merits by the authority, subject to the normal legal tests, but removing limitation as a ground for rejection. The direction was given to protect the petitioners' opportunity to be heard and to avoid denial of livelihood by rigid procedural dismissal.

Both petitioners permitted to file appeals within ten days; competent authority directed to consider and decide the appeals on merits in accordance with law, excluding the limitation bar.

Final Conclusion: Writ petitions allowed in part: order dated 09.09.2022 in Poonamchand Saran set aside; both petitioners given ten days to file appeals against cancellation of GST registration and the competent authority directed to consider and decide those appeals on merits, excluding limitation as a ground for rejection.

Filing refund application under section 54 of the Central Goods and Services Tax Act, 2017 - exclusion of period from computation of period of limitation for filing refund - notification No. 13/2022-Central Tax dated 5.7.2022 - statutory interest on delayed refund

Filing refund application under section 54 of the Central Goods and Services Tax Act, 2017 - exclusion of period from computation of period of limitation for filing refund - notification No. 13/2022-Central Tax dated 5.7.2022 - Whether the petitioners' refund applications, earlier treated as belated, fall within time by operation of the Notification dated 5.7.2022 which excludes a specified period for computation of limitation for filing refund applications under the Act. - HELD THAT: - The parties were agreed that Notification No. 13/2022-Central Tax dated 5.7.2022, issued under the power now embodied in section 168A, excludes the period from 1st March, 2020 to 28th February, 2022 from computation of limitation for filing refund applications under the Act. The respondents did not dispute applicability of the Notification to the petitioners' case and produced an email communication from the competent authority confirming that the Notification applies to bring the refund claim within time. On this factual and legal basis the Court held that the refund applications, which had been rejected as time-barred, must be treated as filed within the excluded period and therefore within time for adjudication under the statute.

The Notification dated 5.7.2022 applies to the petitioners' refund claims and the applications are to be treated as within time.

Statutory interest on delayed refund - administrative processing and adjudication of refund claims - Whether and how the respondent authorities should proceed once the refund applications are treated as within time. - HELD THAT: - Having held that the refund applications are within time by virtue of the Notification, the Court directed the competent authority to process the petitioners' refund claims in accordance with law and to sanction the refund with statutory interest if the petitioners are found eligible. The Court mandated completion of this processing within 12 weeks from receipt of the order, thereby requiring fresh administrative adjudication and payment, if merited, including interest as provided by the statute.

Respondents directed to process and decide the refund claims in accordance with law and to grant refund with statutory interest, if eligible, within 12 weeks.

Final Conclusion: The petitions are disposed of by holding that Notification No. 13/2022 applies to make the refund applications timely; the respondent authorities are directed to process the claims and, if eligible, sanction the refund with statutory interest within 12 weeks from receipt of this order.

Revocation of cancellation of registration - restoration of cancelled GST registration - remedy under Section 30 for revocation - appeal under Section 107 - condonation of delay in availing statutory remedies - filing returns and payment of tax, interest, fine and fee for defaulted period - prohibition on adjustment from Input Tax Credit - directions to modify GST portal (GSTN) to enable compliance - effectiveness of judicial order in absence of State appeal

Revocation of cancellation of registration - remedy under Section 30 for revocation - appeal under Section 107 - condonation of delay in availing statutory remedies - Restoration of cancelled GST registrations of the petitioners was permitted notwithstanding their failure to invoke statutory remedies within the prescribed periods, subject to compliance with specified conditions. - HELD THAT: - The Court applied its earlier order in W.P.Nos.10663 of 2022 etc. (order dated 31.01.2022 as reiterated on 17.08.2022) to the present batch, noting that petitioners had not pursued the in-built remedies under the Act (Section 30 or appeal under Section 107) or missed opportunities under amnesty schemes. The State did not prosecute an appeal against the earlier order and had implemented its directions; the Court treated the omission to appeal as acceptance of that earlier decision. Consequently, the petitioners were permitted to seek restoration by complying with the conditions laid down in the prior order within the stipulated timeframe.

Writ petitions allowed insofar as petitioners were permitted restoration of registration subject to compliance with the conditions specified by the Court.

Filing returns and payment of tax, interest, fine and fee for defaulted period - prohibition on adjustment from Input Tax Credit - Conditions for restoration: filing outstanding returns and payment of tax, interest, fine/fee within 45 days, and prohibition on using Input Tax Credit to make such payments. - HELD THAT: - The Court directed that petitioners must file returns for the period prior to cancellation (if not already filed) and pay the tax in default together with interest and the fine/fee applicable for belated filing within forty-five days from receipt of the order. The Court expressly prohibited making these payments by adjusting any unutilised or unclaimed Input Tax Credit. Upon uploading returns and making payments as directed, registration would be revived forthwith.

Restoration contingent on filing returns and payment of tax, interest and penal charges within the specified period, without adjustment from Input Tax Credit, upon which registration shall be revived.

Directions to modify GST portal (GSTN) to enable compliance - effectiveness of judicial order in absence of State appeal - State respondents were directed to instruct GSTN to modify the GST web portal to enable filing of returns and payment of tax/penalty/fine by the petitioners within 45 days. - HELD THAT: - Recognising practical impediments to compliance on account of portal architecture, the Court directed respondents to take steps, by instructing GST Network, New Delhi, to make suitable changes to allow the petitioners to file returns and pay demanded amounts. The respondents were given forty-five days from receipt of the order to effect such changes. The Court relied on the State's failure to appeal the earlier order and its implementation as a factual basis for issuing the operative directions.

Respondents to cause GSTN to effect necessary portal changes within forty-five days to facilitate filing of returns and payments so that registrations may be revived upon compliance.

Final Conclusion: The writ petitions are allowed by applying the Court's earlier order to the present matters: petitioners may have their cancelled GST registrations restored on filing prior-period returns and payment of tax, interest and applicable fine/fee within forty-five days (without utilising Input Tax Credit), and the respondents are directed to instruct GSTN to enable such filing and payments; connected miscellaneous petitions are closed and no costs were awarded.

Show cause notice under Section 73 - statutory period for payment and reply (30 days) - inadequate notice and violation of principles of natural justice - withdrawal of order for procedural illegality - costs - training and orientation of tax officers

Show cause notice under Section 73 - statutory period for payment and reply (30 days) - inadequate notice and violation of principles of natural justice - Validity of a show-cause notice which afforded only seven days to reply when Section 73 contemplates a 30-day period for payment or for filing a response. - HELD THAT: - The Court held that Section 73(8) permits a person chargeable with tax under subsection (1) or (3) a period of 30 days from issuance of the show-cause notice to make payment of the tax with interest, and that if the person opts not to pay, the same 30-day period is available to file a reply. That statutory period cannot be arbitrarily reduced by the assessing officer. The impugned notice which allowed only seven days to reply was therefore contrary to the statutory scheme and to the principles of natural justice; the Department itself in the impugned order treated non-payment within 30 days as material, demonstrating incompatibility between the short notice and the statutory period. The Court accepted the State's concession that the seven-day period was erroneous and that the subsequent order was premised on the incorrect short notice. [Paras 2, 3, 4]

A show-cause notice affording only seven days to reply was held to be procedurally illegal and contrary to the statutory 30-day period; the assessing officer cannot shorten that period.

Withdrawal of order for procedural illegality - Relief in respect of the impugned order dated 10th March 2022 which was passed after giving only seven days to reply. - HELD THAT: - On the State's concession that the show-cause notice had incorrectly allowed only seven days and that the impugned order was therefore erroneous, the Court directed withdrawal of the impugned order. The Court observed that because the order was passed without affording the statutory opportunity, the basis for demand did not survive. The Court thus disposed of the petition by ordering the impugned order to be withdrawn. [Paras 4]

Impugned order dated 10th March 2022 to be withdrawn by the respondents.

Costs - Imposition of costs on the respondents for having passed a patently illegal order without application of mind. - HELD THAT: - The Court noted recurring instances of orders passed by officers contrary to statutory provisions and principles of natural justice, causing hardship and burdening judicial time. In view of the absence of application of mind and the prejudice caused to the assessee, the Court found it appropriate to saddle the respondents with costs as a corrective measure and deterrent against similar future conduct. [Paras 5, 6]

Respondents directed to pay costs (to be paid as a donation to the PM CARES Fund) within two weeks of upload of the order.

Training and orientation of tax officers - principles of natural justice - Administrative direction to forward a copy of the order to higher tax authorities for training of officers to prevent recurrence of legally deficient orders. - HELD THAT: - The Court directed that a copy of the order be sent to the CBIC and the Chief Commissioner of State Tax, Maharashtra, so that they may hold training or orientation sessions to apprise officers of the law, rules framed thereunder and the meaning and application of principles of natural justice. The direction was framed to mitigate systemic deficiencies and avoid prejudice to taxpayers arising from orders passed without proper legal appreciation. [Paras 7]

Order to be forwarded to CBIC and Chief Commissioner for appropriate training/orientation of officers.

Final Conclusion: The petition was allowed: the Court held that a show-cause notice allowing only seven days to reply was procedurally illegal vis-a -vis the statutory 30-day period, directed withdrawal of the impugned order, imposed costs on the respondents to be paid as a donation to the PM CARES Fund, and directed that the order be forwarded to higher tax authorities for training of officers.

Tender evaluation - uniform GST rate in bid evaluation - pre-bid clarification and estoppel - interim injunction in public procurement - public interest in contract award

Tender evaluation - uniform GST rate in bid evaluation - public interest in contract award - interim injunction in public procurement - Challenge to the validity of bid evaluation insofar as differing GST rates quoted by bidders were taken into account and whether further action on award should be stayed. - HELD THAT: - The petitioner alleged that the tender evaluation impermissibly considered divergent GST rates quoted by bidders, thereby distorting competitive bidding and adversely affecting public interest. The respondent contended that the petition was not maintainable and that any ambiguity should have been raised at the pre-bid stage; the successful bidder asserted estoppel. After hearing rival submissions and balancing equities, the Court found that, in view of the magnitude of the contract and the public money involved, the interest of justice and public interest justified preservation of the status quo pending adjudication on the merits. The Court did not finally adjudicate the merits of the contention on GST uniformity or on maintainability/estoppel but considered these contentions in the exercise of its discretion for interim relief and directed production of records for expeditious disposal on the returnable date. [Paras 4, 11, 12]

Directed that no further action be taken by the Oil India Limited after declaration of respondent no.3 as L-1 until the returnable date; directed production of records and listed the matter after four weeks.

Final Conclusion: Notice issued; interim restraint granted maintaining status quo on award to the declared L-1 bidder until the returnable date, with records to be produced and the writ petition to be listed after four weeks for expeditious disposal.

Interim protection conditioned on deposit - classification of Viability Gap Fund as subsidy - disclosure obligation under migrated GST registration - jurisdictional allocation between Central and State GST authorities - alternative statutory remedy

Interim protection conditioned on deposit - Order for interim protection subject to deposit of specified amount - HELD THAT: - The Court granted interim protection restraining coercive recovery measures in relation to the demand challenged in the writ petition, subject to the petitioner depositing a sum of Rs.65.00 lakhs on or before 31st March, 2022. The order preserves the respondent's right to pursue the remaining demand but bars immediate coercive steps so long as the deposit condition is complied with by the stipulated date. This relief is interlocutory and does not decide the merits of the tax demand or the validity of the underlying assessment order. [Paras 7]

No coercive steps shall be taken to recover the remaining demand provided the petitioner deposits Rs.65.00 lakhs by 31st March, 2022.

Disclosure obligation under migrated GST registration - jurisdictional allocation between Central and State GST authorities - Directional and procedural orders while keeping substantive controversy open - HELD THAT: - The Court recorded competing contentions on whether the Viability Gap Fund received by the petitioner is a government subsidy and therefore exempt from GST under the definition of "consideration", and whether disclosure and assessment fall within State or Central GST jurisdiction given migrated registrations. Rather than adjudicating these factual and legal controversies, the Court issued notice, allowed the respondents opportunity to file a counter affidavit and required service of copies of the petition on the respondents within three working days. The Court thus left the substantive questions for adjudication by the appropriate authority or forum while ensuring the parties' contentions would be placed before the court and opposing side. [Paras 3, 4, 5, 6]

Notice issued; respondents granted opportunity to file counter affidavit; requisite number of copies to be served on the respondents within three working days.

Alternative statutory remedy - Matter left for determination through available statutory remedies - HELD THAT: - The Court noted that factual disputes exist regarding classification of the Viability Gap Fund and the appropriate forum for assessment, and observed that the petitioner may be required to pursue the alternative or statutory remedy available under the OGST Act. The Court did not decide the merits and implicitly left these issues to be considered afresh by the competent authority or on appropriate statutory appeal/remedy, permitting the respondents to place their case on record for adjudication. [Paras 4, 6]

The substantive controversy is not decided and is to be addressed through the available statutory remedy; respondents may file counter affidavit for adjudication.

Final Conclusion: Writ petition admitted for interim consideration; notice issued and respondents permitted to file counter affidavit. Interim protection granted from coercive recovery subject to deposit of Rs.65.00 lakhs by 31st March, 2022; substantive disputes on classification of the Viability Gap Fund, disclosure obligation and proper forum remain open for adjudication through the statutory remedy.

Benefit of input tax credit under Section 171 - commensurate reduction in prices - anti-profiteering - profiteered amount determined by comparison of pre GST and post GST ITC to turnover ratios - refund of profiteered amount with interest - penalty for denial of ITC post 01.01.2020 - investigation scope linked to RERA registration

Benefit of input tax credit under Section 171 - commensurate reduction in prices - anti-profiteering - Whether the Respondent violated the obligation to pass on the benefit of input tax credit to recipients in terms of Section 171(1) of the CGST Act, 2017. - HELD THAT: - The Authority found that Section 171(1) requires any benefit of input tax credit to be passed on to each recipient by way of a commensurate reduction in price and that this obligation applies to every taxable supply and every buyer, not only to the applicant. On facts, the DGAP's investigation showed a material increase in the ITC available post GST compared to pre GST (0.76% pre GST v. 9.13% post GST) for the Project "SKA Green Arch", yielding an additional ITC benefit which was required to be passed on to the buyers. The Respondent's contentions that the investigation should be confined to the applicant, that post GST phase II should be excluded, or that no uniform methodology exists were considered and rejected: the Authority held that comparison of pre and post GST ITC to turnover ratios is a proper and logical method to ascertain the additional ITC benefit and that the Project could not be segmented merely because some construction activity occurred post GST where a single RERA registration and single project financing/accounting exist. Consequently, the Authority concluded that the Respondent denied the benefit of ITC to the customers in contravention of Section 171(1). [Paras 15, 16, 21, 22, 26]

The Respondent violated Section 171(1) by not passing on the benefit of input tax credit to the recipients in the Project "SKA Green Arch".

Profiteered amount determined by comparison of pre GST and post GST ITC to turnover ratios - profiteered amount - The quantum of the additional benefit of ITC required to be passed on (i.e., the profiteered amount) for the Project "SKA Green Arch" for the investigation period. - HELD THAT: - On the basis of the data submitted and examined (ITC/CENVAT figures, turnovers, sold area and buyers' details), the DGAP computed the increase in the effective ITC ratio post GST as 8.37% (9.13% minus 0.76%). Applying that increase to the relevant base prices and excluding post GST buyers whose agreements expressly stated that ITC benefit had been accounted for (642 buyers), the DGAP recalibrated base prices and computed excess realisation. The Authority reviewed the DGAP's methodology and tables (Table A and Table B) and found no reason to differ. Accordingly, the profiteered amount for the period 01.07.2017 to 31.10.2020 was determined as Rs. 4,75,87,468 for the Project "SKA Green Arch". [Paras 16, 18, 19, 26, 27]

Profiteered amount determined as Rs. 4,75,87,468 for the period 01.07.2017 to 31.10.2020 for the Project "SKA Green Arch".

Refund of profiteered amount with interest - pass on benefit to each recipient - Remedial directions to be issued to the Respondent for passing on the determined benefit and the mode/timing of compliance. - HELD THAT: - Pursuant to Rule 133(3)(a) and (b) and the Authority's findings, the Respondent was ordered to reduce prices commensurate with the ITC benefit and to refund the profiteered amount to the affected buyers. The Authority directed refund of the profiteered amount along with interest at 18% from the date the amount was profiteered until payment. The Authority ordered the Respondent to pass/pay the amount within three months from the date of the Order and directed the concerned jurisdictional CGST/SGST Commissioner to ensure compliance, to advertise the Order so affected buyers may claim benefits if not passed on, and to report compliance within four months. The Authority also required that the Respondent continue to pass on any further ITC benefit that accrues up to the date of issue of Completion Certificate and authorised complainants to approach the State Screening Committee if residual benefits are not passed on. [Paras 28, 30, 32, 33, 34]

Respondent directed to refund/pass on the profiteered amount of Rs. 4,75,87,468 with 18% interest within three months; jurisdictional Commissioners to ensure compliance and advertise; further ITC benefits to be passed until Completion Certificate and compliance report to be submitted.

Penalty for denial of ITC post 01.01.2020 - Whether the Respondent is liable for penalty under the amended statutory provision for the period from 01.01.2020 onwards. - HELD THAT: - The Authority noted that Section 171(3A) was inserted w.e.f. 01.01.2020 and that the investigation period extends from 01.07.2017 to 31.10.2020; accordingly, the Authority found that the Respondent committed an offence under Section 171(3A) for the portion of profiteering occurring on or after 01.01.2020. The Authority did not immediately impose penalty but recorded that a notice be issued to the Respondent calling upon him to explain why penalty should not be imposed for the amount profiteered from 01.01.2020 onwards. [Paras 31]

Notice to be issued to the Respondent to show cause why penalty under Section 171(3A) should not be imposed for the period from 01.01.2020 onwards.

Investigation scope linked to RERA registration - further investigation of other projects under same GSTIN - Scope of investigation: inclusion of all phases of the project and further action on other projects under the same GST registration. - HELD THAT: - The Authority held that the Project could not be segmented merely because phase II construction activity commenced post GST where there is a single pre GST RERA registration covering all towers, single project financing and no separate accounting of ITC by tower; consequently, all phases of the Project were properly included in the investigation. Given the likelihood that similar non compliance may exist in other projects under the same GSTIN, the Authority directed the DGAP under Rule 133(5) to investigate all other projects of the Respondent under the same GST registration which were not yet investigated and to submit complete reports. [Paras 14, 35]

All phases of the single RERA registered Project included in the investigation; DGAP directed to investigate other projects under the Respondent's GSTIN and submit reports.

Final Conclusion: The Authority held that M/s Prasu Infrabuild Pvt. Ltd. contravened Section 171(1) by denying ITC benefits to buyers of the Project "SKA Green Arch" and determined the profiteered amount for 01.07.2017 to 31.10.2020 as Rs. 4,75,87,468; the Respondent is directed to refund/pass this amount with interest at 18% within three months, compliance to be ensured and reported by the jurisdictional Commissioners, a notice regarding penalty under Section 171(3A) (effective 01.01.2020) is to be issued, and the DGAP is directed to investigate other projects under the same GST registration.

Addition of alleged bogus purchases as income - treatment of profit element versus entire transaction amount - reasoned appellate adjudication and absence of perversity - reliance on precedent and conformity with higher court decisions

Reasoned appellate adjudication and absence of perversity - reliance on precedent and conformity with higher court decisions - Whether the order of the Income Tax Appellate Tribunal was perverse for not applying the Supreme Court decision in N K Protein Ltd. and whether interference was warranted. - HELD THAT: - The High Court examined the Tribunal's order and found it to be well reasoned, taking into account the material facts and the chain of findings from the Assessing Officer and the appellate authorities. The Court observed that the Tribunal considered the practical nexus between purchases and execution of contract works and applied the principle that only the real income (profit element) could be taxed where the transaction amount itself was not verifiable as income. Having reviewed the Tribunal's reasoning, the High Court concluded there was no perversity or legal error warranting interference despite the subsequent Supreme Court decision relied upon by the appellant. [Paras 5]

Tribunal's order is not perverse; no interference for alleged non-application of the N K Protein decision.

Addition of alleged bogus purchases as income - treatment of profit element versus entire transaction amount - Whether the entire alleged purchases could be added as income under the Act or whether only the profit element embedded in such purchases was taxable, and whether the limited disallowance of 12.5% was sustainable. - HELD THAT: - The Court recorded the factual findings: the assessment was reopened on information from the Sales Tax Department and the AO made additions treating purchases as bogus. On appeal the CIT(A) allowed relief by disallowing 12.5% of purchases to safeguard revenue, and the Tribunal upheld that approach after noting that execution of municipal contracts presupposed procurement of materials and that the turnover was not disputed. The Tribunal and the High Court applied the legal proposition that where the full transaction cannot be equated to income, the profit component may alone be chargeable. Having considered the Tribunal's application of that principle to the material on record, the High Court found the limited disallowance to be a reasoned outcome and not susceptible to interference. [Paras 3, 4, 5]

Entire purchases were not added; sustaining treatment taxing the profit element and upholding limited disallowance (12.5%) as reasonable.

Addition of alleged bogus purchases as income - Whether the addition based on information from the Sales Tax Department establishing purchases from bogus parties required the full addition of the purchase amounts. - HELD THAT: - The Court noted the AO's reliance on information from the Sales Tax Department that purchases appeared to be accommodation entries and that the AO made additions under the relevant provisions. However, on appellate review the facts, including payments through banking channels, production of invoices and ledger statements, and accounting of sale proceeds, were considered. The Tribunal concluded that absence of direct proof that materials were not procured from other sources meant the assessor could not simply treat the entire purchase amount as income; instead, the profit portion was taxable. The High Court accepted this application of law to the facts and declined to disturb the finding. [Paras 3, 4, 5]

Addition based on Sales Tax Department information did not justify full addition of purchase amounts; only profit element treated as income.

Final Conclusion: The appeal is dismissed; the Tribunal's order upholding a limited disallowance (taxing the profit element rather than the entire alleged bogus purchases) is sustained as a reasoned appellate decision and does not call for interference.

Principles of natural justice - audi alteram partem - gifts as sham transactions - onus under Section 68 - evidence collected during search under Section 132 - concurrent findings and reappreciation of evidence

Principles of natural justice - audi alteram partem - evidence collected during search under Section 132 - Whether the assessment and the Tribunal's confirmation thereof were vitiated by violation of principles of natural justice for want of opportunity to cross-examine witnesses whose statements were relied upon. - HELD THAT: - The Court examined whether reliance on statements and material gathered in the course of a search under the statutory scheme amounted to a breach of audi alteram partem because the assessee was not afforded cross-examination. Having regard to the search conducted under Section 132 and the statutory recognition of statements taken during search as evidence, the Court held that where the assessee failed to produce the donors or otherwise offer a convincing explanation, the department was entitled to treat the material on record as admissible and act upon it. The judgment records that the assessee did not satisfactorily discharge the burden of proof and that much of the material pointed to arrangements inconsistent with gifts made out of natural love and affection. On these facts the absence of cross-examination did not render the assessment a nullity or warrant interference with the Tribunal's conclusion. [Paras 7, 8, 9, 10, 11]

No violation of principles of natural justice is established; the absence of cross-examination did not vitiate the assessment or the Tribunal's order.

Gifts as sham transactions - onus under Section 68 - concurrent findings and reappreciation of evidence - Whether the gifts received from Non-Resident Indians were genuine or liable to be treated as unexplained credits and added to the assessee's income. - HELD THAT: - The Court applied the legal burden that, once the nature of receipts is in doubt, the assessee must satisfactorily explain their nature and source. On inquiry the department obtained statements suggesting that some donors arranged gifts on receipt of commission, and relatives corroborated doubts about creditworthiness. The Court accepted that a literal and legal meaning of 'gift' requires voluntary transfer without consideration and that evidence before the authorities pointed to transactions inconsistent with genuine gifts. Given the assessee's failure to produce convincing oral evidence or to establish close relationships with 29 donors, the Tribunal's factual finding that the receipts were not genuine gifts and the consequent addition under the charging provision could not be upset without reappreciating concurrent findings of fact. [Paras 8, 9, 10, 11]

The gifts were not established as genuine; the addition treating them as undisclosed income is upheld.

Final Conclusion: The Tax Case Appeal is dismissed; the Tribunal's confirmation of the addition treating the alleged NRI gifts as sham and the related assessment are upheld, and the substantial questions of law are answered against the appellant.

Penalty under section 271AA - maintenance of transfer pricing documentation under section 92D and rule 10D - requirement to specify missing documents by Assessing Officer - bona fide belief in non-reporting of transactions - relevance of Permanent Establishment to penalty proceedings - distinguishing precedent on facts

Penalty under section 271AA - maintenance of transfer pricing documentation under section 92D and rule 10D - requirement to specify missing documents by Assessing Officer - Whether penalty under section 271AA could be sustained for alleged failure to keep and maintain transfer pricing documentation required by section 92D(1)/92D(2) read with rule 10D. - HELD THAT: - The Tribunal found that the Assessing Officer's sole basis for levy of penalty was a general finding that the assessee had not maintained documents as required by section 92D(1)/(2) read with rule 10D. On the material before it, the Tribunal noted that the assessee had maintained and produced transfer pricing documentation in respect of reported international transactions (FTS and FIS), and that the TPO had recorded that documentation containing functional and economic analysis prescribed under rule 10D was submitted and no adverse inference was drawn. Crucially, the Assessing Officer did not identify the specific documents or information which were alleged to be missing. In the absence of any specification by the AO of what statutory records were not maintained and given the production of TP documentation and the TPO's finding, the Tribunal upheld the CIT(A)'s cancellation of the penalty. The Tribunal therefore applied the legal principle that a penalty for non-maintenance of prescribed TP records cannot be sustained where the assessee has produced the requisite documentation and the AO fails to point to specific omissions warranting penalty.

Penalty under section 271AA deleted; appeal dismissed on this ground.

Distinguishing precedent on facts - bona fide belief in non-reporting of transactions - relevance of Permanent Establishment to penalty proceedings - Whether decisions in the assessee's earlier Assessment Years adverse to the assessee could sustain the penalty in the present year. - HELD THAT: - The Tribunal examined the coordinate-bench decisions relied upon by Revenue and found the factual basis of those decisions materially different - earlier orders turned on deficiencies relating to independent accountant's reports for specified domestic transactions which were not present in the current assessment. The Tribunal also noted that the only adjustment in the present year related to profits attributable to a PE, and that the assessee had, in Form 3CEB, reported the relevant receipts and had a bona fide belief that other transactions did not give rise to income in India and therefore were not reported. Given the differing factual matrix and the absence of specified missing documents, the Tribunal distinguished the prior decisions and declined to apply them to sustain the penalty in the present case.

Earlier Tribunal decisions distinguished on facts; reliance on those precedents did not support the penalty in the present assessment year.

Final Conclusion: The Tribunal upheld the order of the Commissioner (Appeals) and dismissed the Revenue's appeal, deleting the penalty under section 271AA for F.Y. 2008-09 on the ground that requisite transfer pricing documentation was maintained or produced and the Assessing Officer failed to specify any missing documents; prior adverse decisions were distinguished on facts.

Section 43B - section 36(1)(va) - employee's contribution to provident fund and ESI - due date for filing return under section 139(1) - retrospective application of Finance Act, 2021 amendment - intimation under section 143(1)

Section 43B - intimation under section 143(1) - Whether the disallowance of a sum shown under 'other current liabilities' by invoking section 43B was adjudicated by the CIT(A) - HELD THAT: - The Tribunal found that, although the assessee had placed detailed submissions before the CIT(A) on the disallowance under the head 'Other current liabilities' invoking section 43B, the first appellate order does not contain any adjudication on this ground. The revenue's contention that the matter requires examination and verification was noted. Consequently the Tribunal restored ground No.1 to the file of the CIT(A) for fresh adjudication and treated the restoration as allowing the ground for statistical purposes. [Paras 5]

Ground No.1 is restored to the file of the CIT(A) for adjudication.

Section 36(1)(va) - section 43B - employee's contribution to provident fund and ESI - due date for filing return under section 139(1) - retrospective application of Finance Act, 2021 amendment - Whether employees' contributions to PF/ESI deposited before filing the return are allowable despite amendments made by Finance Act, 2021 - HELD THAT: - The Tribunal followed the jurisprudence of the jurisdictional High Court holding that (a) where employees' contributions are deposited before the due date for filing the return under section 139(1), the assessee is entitled to claim deduction; and (b) the explanations inserted by Finance Act, 2021 are intended to take effect from 1 April 2021 and do not apply to earlier assessment years. The Tribunal relied on the reasoning that the Memorandum to the Finance Bill expressly states the amendments operate from 1.4.2021 and that a provision stated to be 'for removal of doubts' cannot be construed as retrospective so as to alter settled law for prior years. On the facts the assessee deposited the employer's contributions before filing the return, and accordingly the disallowance made by the AO and upheld below was deleted. [Paras 6, 8, 9]

Ground No.2 is allowed; the disallowance relating to employees' contribution to ESI and PF is to be deleted and the AO directed to give effect accordingly.

Final Conclusion: Appeal allowed: ground No.1 restored to the CIT(A) for adjudication; ground No.2 allowed with direction to delete the disallowance relating to employees' contribution to PF/ESI for Assessment Year 2018-19; other grounds were ancillary and need no separate adjudication.

Forfeiture of exemption under section 13(1)(c) and 13(1)(d) - Scope of exemption under sections 11 and 12 where trust property is used by specified persons - Chargeability at maximum marginal rate restricted to part of relevant income forfeiting exemption - Admissibility of subsequent public-authority order as additional evidence before appellate authority under power to make further inquiry - Obligation on assessing officer to quantify part of income/property on which exemption is lost and to conduct further enquiry

Forfeiture of exemption under section 13(1)(c) and 13(1)(d) - Scope of exemption under sections 11 and 12 where trust property is used by specified persons - Chargeability at maximum marginal rate restricted to part of relevant income forfeiting exemption - Whether violation of section 13(1)(c)/(d) results in denial of exemption on the whole of the trust's income or only to the extent of the part concerned - HELD THAT: - The Tribunal held that where trust property or income is applied for the benefit of persons specified in section 13(3), the consequence under section 13 is limited to the particular part of income or property which has forfeited exemption. On a conjoint reading of section 13 and section 164 (and the proviso thereto) the statutory language and legislative history show that the maximum marginal rate and consequent taxation apply to the relevant income or part thereof which has forfeited exemption, not to the entire income of the trust. The decision follows and relies upon a consistent line of judicial authority cited in the order (including decisions referred to in the CIT(A)'s reasoning and subsequent Tribunal jurisprudence) which restrict denial of exemption to the quantum of benefit or income related to the contravention. The Tribunal accordingly upheld the CIT(A)'s conclusion that exemption cannot be denied for the trust's whole income and that denial/chargeability must be confined to the part covered by the violation. [Paras 12, 14]

Exemption under sections 11 and 12 is not lost on the whole of the trust's income; forfeiture is restricted to the part of income/property that is used for the benefit of specified persons and only that part is chargeable (at the maximum marginal rate as applicable).

Admissibility of subsequent public-authority order as additional evidence before appellate authority under power to make further inquiry - Admissibility of the order of the Joint Charity Commissioner dated 30.03.2022 as additional evidence before the appellate forum - HELD THAT: - The Tribunal exercised the appellate power to admit the subsequent order of the Joint Charity Commissioner as additional evidence under its power to make further inquiry (analogous to the plenary powers of an appellate authority and in line with authorities such as Jute Corporation of India Ltd.). The Charity Commissioner's order, delivered after completion of reassessment, was admitted because it arose from the same factual material and could not have been placed before the assessing officer earlier. The Tribunal examined the Charity Commissioner's findings and held that while that order absolved trustees under section 41D proceedings, it nonetheless corroborated admission that a wing of the 8th floor was used by the company and that no compensation had been paid; accordingly the Charity Commissioner's findings were taken into account for the income-tax proceedings. [Paras 5]

The Joint Charity Commissioner's order dated 30.03.2022 is admitted as additional evidence and its relevant findings are taken into account in the income-tax appeal.

Obligation on assessing officer to quantify part of income/property on which exemption is lost and to conduct further enquiry - Scope of enquiry into use of trust property by specified persons - Whether the assessing officer's factual finding that a portion of the 8th floor was used by a specified person without compensation is sustainable and whether further enquiry is required about the 10th floor and quantification of the part of income losing exemption - HELD THAT: - On the materials before it (including the admitted facts, documentary evidence relied upon by the assessing officer, and the Charity Commissioner's findings), the Tribunal found the assessing officer's conclusion that M/s Ideen Furniture Pvt. Ltd. occupied a portion (one wing) of the 8th floor without paying compensation to be correct and supported. Consequently, the provisions of section 13(1)(c) apply in respect of that portion. However, the Tribunal directed that the assessing officer must determine the exact part of income or property on which exemption is lost and compute the tax consequences accordingly after giving the assessee an opportunity of hearing. With respect to the 10th floor allegation, the Tribunal noted that the Joint Charity Commissioner did not find misuse beyond reasonable doubt and therefore directed the assessing officer to make an independent inquiry under the Income-tax Act perspective to verify whether the 10th floor was used (directly or indirectly) for the benefit of specified persons; if so, the provisions of section 13(1)(c) would apply to that property as well. The Tribunal also directed the assessing officer to examine whether the notional benefit/income is chargeable in the hands of the specified persons under section 56(2)(vii) (for the relevant period) or under section 28(iv). [Paras 16, 17, 18, 19, 20]

AO's finding of occupation of one wing of the 8th floor by the specified concern without compensation is sustained; AO is directed to quantify the part of income/property losing exemption, to make independent enquiries regarding the 10th floor, and to examine taxability in the hands of specified persons; computation to be carried out after opportunity of hearing.

Final Conclusion: The CIT(A)'s order is affirmed to the extent that exemption under sections 11 and 12 cannot be denied for the trust's entire income merely because of a contravention of section 13; forfeiture is confined to the specific part of income/property that benefited specified persons. The Tribunal admitted the Charity Commissioner's order as additional evidence, sustained the assessing officer's finding about occupation of part of the 8th floor by a specified concern without payment, and remanded to the assessing officer for determination and computation of the exact portion of income/property on which exemption is lost, for independent enquiry into the 10th floor allegation, and for examination of possible taxability in the hands of the specified persons; appeals are otherwise dismissed.

Non-taxability of corpus donations as capital receipts - Capital nature of corpus-specific voluntary contributions - Effect of absence of registration under section 12A on taxability of corpus donations - Judicial consistency and precedent governing tax treatment of corpus donations

Non-taxability of corpus donations as capital receipts - Effect of absence of registration under section 12A on taxability of corpus donations - Judicial consistency and precedent governing tax treatment of corpus donations - Addition of corpus donation treated as income of the assessee-trust for A.Y. 2014-15 was not sustainable. - HELD THAT: - The Tribunal found that the Assessing Officer did not dispute that the impugned amount comprised corpus-specific donations credited to the trust's funds. Applying the principle established by coordinate decisions of the Tribunal and the High Court - that corpus donations with specific directions assume a capital character and are not taxable as income - the AT followed the Pune Bench decision in ITO v. Serum Institute of India Research Foundation and other consistent decisions. The Tribunal emphasised judicial discipline and the need to adhere to the favourable line of authorities which hold that corpus-specific voluntary contributions remain capital receipts even where the trust is not registered under section 12A for the relevant year. On that basis the addition made by the AO and sustained below was held to be erroneous and ordered to be deleted. [Paras 6]

The addition of the corpus donation is deleted and the appeal of the assessee is allowed in respect of this issue.

Effect of absence of registration under section 12A on taxability of corpus donations - Whether interest and other consequential demands charged for the assessment year needed separate adjudication. - HELD THAT: - The Tribunal treated the ground challenging interest charged under relevant provisions as consequential to the deletion of the addition and observed that no separate adjudication on that ground was necessary once the primary addition was deleted. [Paras 7]

Ground challenging interest is consequential and requires no separate adjudication.

Final Conclusion: The Tribunal held that corpus-specific voluntary donations received during A.Y. 2014-15 are capital receipts and not taxable in the hands of the unregistered trust; the addition was deleted and the assessee's appeal allowed in part, while the challenge to interest was treated as consequential and not adjudicated separately.

Requirement of CBDT approval for application of income outside India under section 11(1)(c) - tied-up government grants and their non-attribution as voluntary contributions under sections 11 and 12 - treatment of grants earmarked for specific projects as not forming part of assessee's income - judicial consistency and following coordinate bench decisions - restriction on utilization of grant funds and refund/unspent-clause implications

Requirement of CBDT approval for application of income outside India under section 11(1)(c) - tied-up government grants and their non-attribution as voluntary contributions under sections 11 and 12 - treatment of grants earmarked for specific projects as not forming part of assessee's income - restriction on utilization of grant funds and refund/unspent-clause implications - judicial consistency and following coordinate bench decisions - Whether the Assessing Officer was correct in disallowing expenses/grant by treating amounts spent abroad as not eligible for exemption under section 11 because CBDT approval under section 11(1)(c) was not obtained, and whether the government grants in question constituted assessee's income or voluntary contributions under sections 11 and 12. - HELD THAT: - The Tribunal upheld the first appellate order which deleted the addition. The appellate authority and this Tribunal examined the grant sanction documents showing that the grants were tied to participation in specified overseas events and were subject to detailed conditions: separate project account, maintenance of vouchers, prohibition on diversion, audit by sanctioning authority/C&AG, and requirement to refund unspent amounts with interest. On that factual foundation, the Tribunal applied binding precedent that tied or earmarked grants given for specific purposes and spent under stipulated conditions are not voluntary contributions available to the assessee for discretionary use and therefore do not form part of the assessee's income under sections 11 and 12; such grants are to be treated as held and utilized for the specified project. The Tribunal further noted that the CIT(A) followed a coordinate-bench decision in the assessee's own appeals for subsequent assessment years where an identical issue on similar facts was decided in the assessee's favour, and that the Department's representative conceded the similarity of facts for AY 2011-12. Having regard to the documentary terms of the grants and the precedents recognizing tied grants as not constituting assessable income, the Tribunal found no legal infirmity in the deletion of the addition and saw no ground to require separate CBDT approval in the circumstances where the grants were not at the assessee's free disposal but were to be applied strictly as sanctioned. [Paras 4, 5, 6]

Appeal dismissed; the addition disallowing the grant/expenditure is deleted and Revenue's grounds are rejected.

Final Conclusion: The Tribunal, following the factual finding that the impugned grants were tied to specific overseas events and subject to enforceable conditions (including separate accounts, audit and refund of unspent amounts), and having regard to coordinate-bench decisions on identical facts, dismissed the Revenue's appeal and upheld the deletion of the addition for Assessment Year 2011-12.

Assessment in representative capacity - legal representative deemed assessee - nullity for lack of jurisdiction - revision under section 263 not contingent on show-cause notice - principles of natural justice - service of notice - obligation under section 194C(7) to furnish particulars - non-application of mind - set aside for verification

Assessment in representative capacity - legal representative deemed assessee - nullity for lack of jurisdiction - saving by section 292B - Validity of assessment framed after the death of the assessee's father - HELD THAT: - The Tribunal held that jurisdiction to reopen and assess was validly assumed prior to the death of the original assessee by service of notice under section 148(1). On death the legal representative is deemed to be the assessee under section 159 and substitution of the LR is procedural; omission to correctly record the LR's name in the assessment title does not render the assessment a nullity where the LR joined proceedings and was heard. Defects of description or misnaming are saved by established law and by section 292B. The assessment dated 17/02/2016 is therefore valid as an assessment of the appellant in his representative capacity of his late father. [Paras 2, 3]

Assessment held valid as on the appellant in his capacity as legal representative of his late father.

Revision under section 263 not contingent on show-cause notice - principles of natural justice - nullity for lack of jurisdiction - Whether the notice and order under section 263, issued in the name of the deceased, are nullities - HELD THAT: - The Tribunal distinguished jurisdictional notices (whose misnaming may vitiate proceedings when jurisdictional facts are absent) from revision under section 263, which does not require a prior show-cause notice but does require opportunity of hearing. Because the assessment proceedings had been validly initiated and the appellant (as LR) was afforded opportunity, the impugned revision was not rendered a nullity merely by being styled in the name of the deceased. The Tribunal relied on the settled distinction that absence of jurisdiction (a jurisdictional fact) is the ground that vitiates proceedings, which was not the present situation. [Paras 4]

Order under section 263 not a nullity on account of being framed in the name of the deceased; revisionary order valid in present facts.

Service of notice - principles of natural justice - Whether notice under section 263 was duly served on the assessee - HELD THAT: - On the factual material (postal track report and file of the revision proceedings) the Tribunal found that the notice issued on 27/02/2018 was delivered and taken on record, and rejected the appellant's bald claim of non-receipt in the absence of positive proof of change of address communicated to the AO prior to service. The Tribunal observed that even if service had been defective, the remedy would be limited to fresh service and hearing rather than automatic vacation of the revisional order. [Paras 4]

Service of the section 263 notice established; claim of non-receipt rejected.

Obligation under section 194C(7) to furnish particulars - non-application of mind - set aside for verification - Whether the assessing officer properly verified compliance with sections 194C(6) and 194C(7) in relation to non-deduction of TDS on freight and whether the revisioner's direction was justified - HELD THAT: - The Tribunal found the AO's assessment to be without any recorded inquiry on whether (a) the declarations furnished related to the entire sum on which no TDS was deducted and (b) the payments fell in the period covered by the amended law (i.e., on or after 01/10/2009). The absence of any finding amounted to non-application of mind and justified the Pr. CIT's exercise under section 263 to set aside for verification. On the law regarding forms, the Tribunal held that Form 15J remained the prescribed mechanism (and Form 26Q is not a substitute for the particulars required under section 194C(7)), and therefore modified the Pr. CIT's reference to Form 26Q to Form 15-J. The Tribunal concluded that the matter must be restored to the AO to verify the factual aspects and decide in accordance with law, including the legal consequence of non-furnishing of the prescribed particulars. [Paras 5]

Assessment set aside and restored to the AO for limited verification and decision on compliance with sections 194C(6) and 194C(7) (including correct form being Form 15-J); revisionary direction upheld in part.

Final Conclusion: The Tribunal dismissed the assessee's appeal, holding the reassessment and the revisional order under section 263 valid in principle and on facts, while directing that the assessment be restored to the assessing officer for limited verification and adjudication regarding compliance with sections 194C(6) and 194C(7) (with the correct form being Form 15-J) as indicated in the order.

Penalty under section 271D - penalty under section 271E - reasonable cause under section 273B - prohibition on repayment/receipt except by account-payee cheque/bank draft (provisions of section 269T/section 269SS) - assignment of receivables and extinguishment of mutual liabilities by journal entries - journal entries for squaring off mutual transactions as business expediency

Penalty under section 271D - prohibition on repayment/receipt except by account-payee cheque/bank draft (provisions of section 269SS) - reasonable cause under section 273B - assignment of receivables and extinguishment of mutual liabilities by journal entries - Deletion of penalty levied under section 271D in respect of journal entry adjustments and assignments of receivables/payables. - HELD THAT: - The Tribunal upheld the assessment wing appellate finding that the transactions in issue were acts of assignment of receivables or extinguishment of mutual liabilities between the assessee and its sister concerns effected by journal entries and were not repayments or receipts in the nature of loans/advances attracting the prohibition in section 269SS. Further, even if the transactions were held to fall within the mischief of section 269SS, the assessee established a reasonable cause under section 273B-journal entries were passed to extinguish mutual liabilities, avoid empty formalities and for business exigencies, and final balancing/settlement in all cases was effected by account payee cheques. The Tribunal relied on and followed the relevant decisions of the jurisdictional High Court and earlier Tribunal precedents which treat journal entries for squaring off as capable of constituting reasonable cause for deletion of penalty. On these determinative findings the appellate order deleting penalty under section 271D did not warrant interference. [Paras 9, 10]

Penalty under section 271D deleted; revenue appeal dismissed.

Penalty under section 271E - prohibition on repayment/receipt except by account-payee cheque/bank draft (provisions of section 269T) - reasonable cause under section 273B - journal entries for squaring off mutual transactions as business expediency - Deletion of penalty levied under section 271E in respect of repayments/adjustments effected by journal entries. - HELD THAT: - The Tribunal found that the Assessing Officer's conclusion of contravention of section 269T by reason of adjustments through journal entries was addressed by the appellate authority which applied settled principles: journal entries to square mutual receivables/payables or to reflect on behalf payments, where the underlying transactions are genuine and ultimately settled by account payee cheques, can constitute a reasonable cause under section 273B and negate imposition of penalty under section 271E. Specific allegations (including the alleged repayment to Religare Finvest Ltd. by journal entry) were negatived on facts because loan instalments and interest were serviced and the ultimate payments were made by account payee cheques. Having regard to the tribunal and High Court precedents relied upon and the factual findings that transactions were adjustments/extinguishments and finally settled through banking channels, the cancellation of penalty under section 271E was sustained. [Paras 16, 17, 18]

Penalty under section 271E deleted; revenue appeal dismissed.

Final Conclusion: All four revenue appeals challenging deletion of penalties under sections 271D and 271E (for A.Y.2014-15 to 2016-17) are dismissed; the appellate authority's findings that transactions were assignments/extinguishments of mutual liabilities and/or were supported by reasonable cause under section 273B, with ultimate settlement by account payee cheques, are sustained.

Exercise of revisional power under Section 263 of the Income-tax Act - erroneous and prejudicial to the interest of revenue - claim of deduction under Section 57(iii) of the Income-tax Act - onus on the assessee to prove genuineness of deduction - plausible view doctrine - assessment order not to be interfered with merely because another view is possible

Exercise of revisional power under Section 263 of the Income-tax Act - claim of deduction under Section 57(iii) of the Income-tax Act - onus on the assessee to prove genuineness of deduction - plausible view doctrine - Validity of Principal CIT's order under Section 263 setting aside the assessment on ground that Assessing Officer did not make requisite enquiries regarding large interest deduction and related investments/advances. - HELD THAT: - The Tribunal examined whether the AO had conducted enquiries called for by Explanation (a) to Section 263 and specifically whether the issues forming the basis of the revision (deduction under Section 57(iii), investments in immovable property, advances to related parties and investments capable of yielding exempt income) were enquired into during assessment. The record shows the return was selected for limited scrutiny, notices under Section 142(1) were issued raising specific queries on deduction under Section 57 and correlation between loans taken and loans given, and the assessee filed detailed replies (dated 02-02-2019 and 22-07-2019) and furnished audit report and audited financial statements. The AO considered those submissions and accepted the assessee's explanation after application of mind. Reliance was placed on Supreme Court authority establishing that where the AO has made due enquiries and taken a plausible view, revisional power under Section 263 cannot be exercised merely because the Commissioner might have taken a different view. Applying that principle to the facts, the Tribunal held that the AO's action amounted to adequate inquiry and that the Principal CIT's order was without jurisdiction as the AO's view was a plausible one and not erroneous or prejudicial to revenue. [Paras 13, 14, 15, 16]

Principal CIT's order under Section 263 setting aside the assessment was defective; the assessment was not shown to be erroneous and prejudicial to revenue as the AO had made requisite enquiries and taken a plausible view, and the assessee's appeal is allowed.

Final Conclusion: The Tribunal allowed the assessee's appeal for Assessment Year 2017-18, holding that the AO had made the necessary enquiries and reached a plausible conclusion in respect of the deduction under Section 57(iii) and related aspects, and therefore the revisional order under Section 263 was not sustainable.

Condonation of delay - admission of additional grounds in appeal - scope of appellate jurisdiction to entertain additional grounds - twin tests for admission of additional grounds (bona fide and inability to raise earlier for good reasons) - finality of assessment under search proceedings - distinction between proceedings pursuant to search/153C and reassessment under section 263

Condonation of delay - Whether the delay in filing the appeals should be condoned and the appeals admitted for adjudication. - HELD THAT: - The Tribunal examined the assessee's petition for condonation of delay and the explanations offered for late filing. Applying the statutory concept of "reasonable cause," the Tribunal found the reasons furnished by the assessee to qualify as reasonable cause and therefore condoned the delay. Consequently the appeals were admitted for adjudication. [Paras 2]

Delay in filing the appeals is condoned and the appeals are admitted for adjudication.

Admission of additional grounds in appeal - scope of appellate jurisdiction to entertain additional grounds - twin tests for admission of additional grounds (bona fide and inability to raise earlier for good reasons) - finality of assessment under search proceedings - distinction between proceedings pursuant to search/153C and reassessment under section 263 - Whether the CIT(A) erred in rejecting the assessee's additional grounds challenging the validity of the assessment completed under search proceedings and related additions in proceedings before the CIT(A) pursuant to a section 263 direction. - HELD THAT: - The Tribunal noted that the assessee accepted and did not appeal against the original assessment completed under search proceedings (assessment under 153C) and that those proceedings had therefore reached finality insofar as the assessee did not challenge them earlier. The PCIT subsequently invoked section 263 and set aside the assessment on specific issues, and the AO passed consequential assessment orders under the 263 direction. The Tribunal distinguished the two proceedings as independent: an appeal arising from the original 153C assessment is distinct from proceedings arising out of a 263 direction. Applying the established principle that appellate authorities have discretion to admit additional grounds only after satisfying the twin tests (that the ground is bona fide and could not have been raised earlier for good reasons), the Tribunal held that the assessee failed to satisfy those tests. Because the present appeals related to the AO's orders passed pursuant to the 263 direction, the assessee could challenge only the additions made in that round of proceedings and not re-open the legality of the earlier 153C assessment which was not previously contested. The CIT(A)'s refusal to admit the additional grounds was therefore upheld. [Paras 8]

The CIT(A) rightly rejected the additional grounds challenging the validity of the assessment under search proceedings; appeals dismissed on merits.

Final Conclusion: Condonation of delay granted and appeals admitted, but the Tribunal upholds the CIT(A)'s refusal to admit additional grounds challenging the earlier search-based assessment; the appeals are dismissed.

Allowability of commission/business associate expenses in broking business - ad hoc disallowance of business expenses under section 37 - application of consistent historical treatment and appropriate percentage - disallowance under section 14A read with Rule 8D - computation limited to investments yielding exempt income and exclusion of stock in trade/foreign subsidiary investments - disallowance of interest under section 36(1)(iii) for funds deployed as interest free deposits - commercial expediency and presumption of usage of owned/interest free funds

Allowability of commission/business associate expenses in broking business - Deductibility of business associate (sub broker) commission payments claimed by the assessee for AY 2012 13. - HELD THAT: - The Tribunal found as admitted that the assessee is a stock/broking concern which routinely engages sub brokers and had filed a list of sub brokers with names, addresses, PANs and exchange registration numbers together with ledger details and reconciliation statements. The authorities below neither pointed out defects in those particulars nor made any verification before making the disallowance. The Tribunal treated the assessing officer's and CIT(A)'s findings as based on conjecture and surmise, noted the consistent allowance of such payments in earlier years without change in facts, and held that the assessee had substantiated the claim by placing relevant documents on record. On that basis the Tribunal reversed the disallowance. [Paras 12]

Disallowance of business associate expenses of INR 9,77,10,205/ for AY 2012 13 deleted; ground allowed.

Ad hoc disallowance of business expenses under section 37 - application of consistent historical treatment and appropriate percentage - Validity and quantum of ad hoc percentage disallowance of various business expenses for AY 2012 13. - HELD THAT: - The Tribunal observed bulky ledgers and the tax auditor's remark that some personal expenses could not be ruled out. It also noted that in the immediately preceding assessment year the assessing officer had applied a 10% ad hoc disallowance on similar facts. Balancing these factors and the factual matrix of the record, the Tribunal concluded that a 10% disallowance is appropriate and reduced the ad hoc rate applied by the lower authorities accordingly. [Paras 15]

Ad hoc disallowance restricted to 10% of the specified expenditures; ground partly allowed.

Disallowance under section 14A read with Rule 8D - computation limited to investments yielding exempt income and exclusion of stock in trade/foreign subsidiary investments - Extent of disallowance under section 14A and application of Rule 8D for AY 2012 13. - HELD THAT: - Applying binding precedent, the Tribunal held that the disallowance under section 14A cannot exceed the exempt income earned (dividend) in the year and directed that only investments yielding exempt income be considered for computing disallowance under Rule 8D. The Tribunal further directed exclusion of shares held as stock in trade and accepted that investments in foreign subsidiaries - whose dividends are taxable in India - should be excluded while computing the disallowance. [Paras 17, 18]

Disallowance under section 14A to be restricted to amount not exceeding exempt dividend income and to be computed after excluding stock in trade and investments in foreign subsidiaries; ground partly allowed with directions to AO.

Disallowance of interest under section 36(1)(iii) for funds deployed as interest free deposits - commercial expediency and presumption of usage of owned/interest free funds - Whether interest deduction is to be disallowed under section 36(1)(iii) on account of assessee making interest free deposits (leave & licence security) for AYs 2012 13 and 2013 14. - HELD THAT: - The Tribunal noted that a substantial portion of the deposits was returned and utilized as subscription for 9% cumulative preference shares during the relevant year, making those funds available for business. For the remaining balance, the balance sheet showed sufficient owned/interest free funds; relying on settled authority the Tribunal held it permissible to presume that deposits were made out of owned/interest free funds. The Tribunal also distinguished earlier findings made from the licensor's perspective and concluded that, on the facts, disallowance under section 36(1)(iii) was not warranted. [Paras 23, 26]

Addition/disallowance of interest on interest free deposits deleted for AY 2012 13 and AY 2013 14; grounds allowed.

Final Conclusion: The Tribunal allowed the appeals substantially: the business associate commission disallowance for AY 2012 13 was deleted; ad hoc disallowance was confined to 10%; section 14A disallowance was limited to exempt dividend income and computed after excluding stock in trade and foreign subsidiary investments; and interest disallowances under section 36(1)(iii) for AYs 2012 13 and 2013 14 were deleted. Appeals for the two assessment years were thereby partly allowed (2012 13) and allowed (2013 14) as reflected in the order.

Penalty for concealment of income or for furnishing inaccurate particulars of income - omnibus show-cause notice vitiating penalty proceedings - non-application of mind in issuing statutory notice - penalty under section 271(1)(c) of the Income-tax Act - additions based on ad-hoc estimation do not attract penalty

Penalty for concealment of income or for furnishing inaccurate particulars of income - omnibus show-cause notice vitiating penalty proceedings - non-application of mind in issuing statutory notice - penalty under section 271(1)(c) of the Income-tax Act - Validity of the notice issued under section 274 read with section 271(1)(c) when the printed notice did not strike off the inapplicable limb and failed to specify whether penalty was for concealment or for furnishing inaccurate particulars. - HELD THAT: - The Tribunal examined the notice dated 12.12.2017 and found it to be stereotyped and omnibus, since the Assessing Officer did not strike off the irrelevant limb nor specify the charge for which the notice was issued. Relying on the reasoning of the Hon'ble Bombay High Court (Full Bench at Goa) in Mr. Mohd. Farhan A. Shaikh v. ACIT, and the jurisdictional High Court in PCIT v. Sahara India Life Insurance Co. Ltd., the Tribunal held that the assessee must be informed of the grounds of penalty proceedings through the statutory notice and that an omnibus notice suffers from vagueness. The Tribunal treated such omnibus/form notices as indicative of non-application of mind and fatal to the validity of penalty proceedings under section 271(1)(c). Applying that ratio, the penalty notice was held bad in law and the penalty order was quashed for the relevant assessment year. [Paras 5, 10]

Notice was defective for not specifying the limb; penalty order under section 271(1)(c) quashed.

Penalty under section 271(1)(c) of the Income-tax Act - additions based on ad-hoc estimation do not attract penalty - Whether, on merits, penalty under section 271(1)(c) is leviable where the assessing officer made additions by ad-hoc estimation of net profit on unreconciled turnover. - HELD THAT: - The Tribunal independently considered the merits and observed that the addition was made on an ad-hoc basis by estimating net profit at 8% on unreconciled turnover as reflected in books and Form 26AS. Such ad-hoc estimation did not constitute conclusive proof of concealment of income or furnishing of inaccurate particulars. In the absence of conclusive evidence of deliberate concealment or inaccuracy, the conditions for invoking section 271(1)(c) were not satisfied. Accordingly, even on merits the penalty was held not leviable and liable to be deleted. [Paras 11]

Penalty under section 271(1)(c) deleted on merits as addition arose from ad-hoc estimation and did not prove concealment or furnishing of inaccurate particulars.

Final Conclusion: The Tribunal allowed the assessee's appeal: the penalty proceedings were quashed because the statutory notice was omnibus and defective for not specifying the limb of section 271(1)(c), and, additionally, the penalty was not sustainable on merits as the addition arose from ad-hoc estimation and did not demonstrate concealment or inaccurate particulars.

Disallowance under section 14A and Rule 8D where no exempt income - Applicability of judicial precedents in interpreting section 14A - Taxability of belated employee's provident fund/ESI contribution under section 2(24)(x) and claim of deduction under section 36(1)(va) - Precedential binding of Delhi High Court decisions on identical issues

Disallowance under section 14A and Rule 8D where no exempt income - Applicability of judicial precedents in interpreting section 14A - Deletion of addition made by invoking section 14A read with Rule 8D where the assessee did not earn any exempt income - HELD THAT: - Ld. CIT(A) found on facts that the assessee did not earn any exempt income during the year and, applying binding decisions of the jurisdictional High Court, held that no disallowance under section 14A can be made in the absence of exempt income. The Tribunal, following the cited coordinate Bench and High Court precedents which hold that section 14A disallowance cannot be applied where exempt income is not earned and that post-enactment explanations are not to be given retrospective effect, affirmed the deletion of the disallowance. The Revenue did not place any material to rebut the factual finding of absence of exempt income or to distinguish the precedents relied upon. [Paras 8, 10]

The deletion of the section 14A/Rule 8D disallowance is affirmed and the Revenue's ground challenging that deletion is dismissed.

Taxability of belated employee's provident fund/ESI contribution under section 2(24)(x) and claim of deduction under section 36(1)(va) - Precedential binding of Delhi High Court decisions on identical issues - Deletion of addition treating belated employer's contribution to PF/ESI as income under section 2(24)(x) and denial of deduction under section 36(1)(va) - HELD THAT: - The Tribunal noted that Ld. CIT(A) deleted the addition based on factual and legal reliance upon binding decisions of the Delhi High Court which interpret the legislative intent that deduction under section 36(1)(va) is allowable when payment is actually made and that belated payment should not be treated as deemed income under section 2(24)(x). The Revenue did not produce contrary material to distinguish the High Court rulings; the Revenue's counsel conceded the issue was covered by the jurisdictional precedents. Accordingly, the Tribunal followed those ratios and affirmed the deletion. [Paras 11, 13]

The deletion of the addition relating to belated payment of employees' contribution to PF/ESI is affirmed and the Revenue's ground challenging that deletion is dismissed.

Final Conclusion: Both grounds of the Revenue's appeal are dismissed; the Tribunal affirms the CIT(A)'s deletions of the section 14A/Rule 8D disallowance and the addition relating to belated employees' contribution to PF/ESI, following binding Delhi High Court and coordinate Bench precedents.

Withholding tax under Section 195 - disallowance under Section 40(a)(i) - Fee for Included Services (FIS) - application of India USA Double Taxation Avoidance Agreement Article 12(4) - taxability of managerial services

Withholding tax under Section 195 - disallowance under Section 40(a)(i) - Fee for Included Services (FIS) - application of India USA Double Taxation Avoidance Agreement Article 12(4) - Assessee was not required to deduct tax at source under Section 195 while remitting management fees to its overseas associated enterprise and consequent disallowance under Section 40(a)(i) is unsustainable. - HELD THAT: - The Tribunal examined the nature of services supplied under the Master Support Services Agreement and noted that a Coordinate Bench had already held, in appeals filed by the payee AE for the corresponding years, that the receipts were not in the nature of FIS under Article 12(4) of the India USA DTAA. Section 195 requires withholding only in respect of payments that are chargeable to tax in India. Having accepted the Coordinate Bench's conclusion that the management/managerial services did not qualify as Fee for Included Services and hence were not taxable in India, there was no statutory obligation on the assessee to withhold tax under Section 195. Consequentially, the Assessing Officer's invocation of Section 40(a)(i) to disallow the expenditure premised on failure to withhold tax could not be sustained. The Tribunal therefore deleted the disallowances in the assessment years under consideration. [Paras 11, 12]

Disallowances under Section 40(a)(i) deleted as the assessee had no obligation to withhold tax under Section 195 in view of the payments not being chargeable to tax in India.

Final Conclusion: Appeals allowed; disallowances under Section 40(a)(i) set aside for assessment years 2011-12 to 2013-14 because management fees paid to the overseas AE were not chargeable to tax in India and no withholding under Section 195 was required.

Confiscation of goods - temporary admission under Carnet (ATA Carnet) - non-observance of condition exempting goods from duty - redemption fine - joint and several liability of guarantor under Carnet - time-extension relief for COVID-19 (limitation exclusion)

Temporary admission under Carnet (ATA Carnet) - non-observance of condition exempting goods from duty - confiscation of goods - Validity of confiscation and duty demand consequent to breach of conditions of temporary admission under Carnet - HELD THAT: - The goods were admitted temporarily under a Carnet subject to a condition of re-export within two months. Although the competent authority had power to extend that period, the appellant failed to re-export within the extended period and a subsequent request for further extension was not accepted. The Tribunal held that such non-observance of the Notification's condition brings the case within the provision treating exempted/imported goods as liable to duty where the condition is not observed. Consequently, the adjudicating authority was justified in directing confiscation with an option of redemption and in calling for duty and interest, and no infirmity was found in those findings. [Paras 7, 11, 12, 13]

Confiscation and concomitant duty demand upheld as justified for breach of conditions of temporary admission under Carnet.

Time-extension relief for COVID-19 (limitation exclusion) - Applicability of COVID-19 period-relief/Ordinance to excuse delay in re-export - HELD THAT: - The Tribunal examined the Supreme Court's orders and the Taxation and Other Laws (Relaxation of Certain Provisions) Ordinance, 2020, which exclude specified periods for computation of limitation and extend certain time-limits beginning from March 20, 2020. The extended period for re-export in this case had expired on 21.12.2019, i.e., well before the COVID-related relief period. Therefore the pandemic-related relief and the Ordinance did not apply to excuse the delayed re-export, and the Notification's condition remained violated. [Paras 8, 9, 10]

COVID-19 related relief/Ordinance held inapplicable; delay not excused by pandemic relief.

Redemption fine - joint and several liability of guarantor under Carnet - Appropriateness of the redemption fine reduced by Commissioner (Appeals) and entitlement to consequential relief for excess deposit - HELD THAT: - The Commissioner (Appeals) reduced the original redemption fine imposed by the adjudicating authority. The Tribunal found the reduction to Rs.50,000 to be reasonable, noting the absence of mala fide on the part of the appellant. As the appellant had already deposited a higher amount (the original redemption fine), the Tribunal directed that the appellant be entitled to consequential relief for the excess amount deposited. The finding that guarantor liability exists under the Carnet regime was noted but did not affect the reasonableness of the reduced fine. [Paras 12, 14]

Reduction of redemption fine by Commissioner (Appeals) upheld; appellant entitled to consequential relief for excess deposit.

Final Conclusion: The appeal is dismissed. The Tribunal upholds confiscation and the demand of duty and interest for breach of Carnet conditions, rules that COVID-19 relief does not excuse the pre March 2020 delay, and affirms the reduction of the redemption fine while granting consequential relief for the excess amount deposited.

Mandatory pre-deposit under Section 129E - appropriation of deposits towards assessed liability - party-specific set-off of pre-deposits - dispensing with deposit on grounds of undue hardship - refund of excess deposit

Mandatory pre-deposit under Section 129E - party-specific set-off of pre-deposits - appropriation of deposits towards assessed liability - Whether amounts deposited by entities other than the appellant during investigation can be treated as the appellant's pre-deposit under Section 129E of the Customs Act. - HELD THAT: - Section 129E requires that the person desirous of appealing must, pending the appeal, deposit the duty and interest demanded or the penalty levied. If the appellant himself had deposited amounts during investigation or before filing the appeal, those amounts qualify as pre-deposit and are ordinarily appropriated against his liability in the impugned order. However, an amount paid by X cannot be set off against the liability of Y; the statutory requirement is party specific. Consequently, amounts deposited by other entities cannot be reckoned as the appellant's pre-deposit for maintaining his appeal. Amounts deposited by other entities may be available for set-off only in appeals or proceedings by those entities or for refund/adjustment against their liabilities if they have no liability or have paid in excess.

Amounts paid by other entities cannot be treated as the appellant's pre-deposit under Section 129E; the applications are rejected.

Final Conclusion: Applications rejected; appellant granted four weeks as a last opportunity to make the statutory pre-deposit and matter listed for further hearing on October 06, 2022.

Corporate Insolvency Resolution Process - default - limitation - moratorium - appointment of Interim Resolution Professional - forfeiture of right to file reply

Default - limitation - Corporate Insolvency Resolution Process - Whether the company petition under section 9 of the IBC deserved admission on the ground of established operational debt and limitation - HELD THAT: - The Tribunal examined the pleadings and documents filed by the Operational Creditor and found that goods and services were supplied to the Corporate Debtor and invoices were raised. The Corporate Debtor neither responded to the demand notice nor repaid the outstanding dues; in open court its counsel admitted liability and inability to pay. The Tribunal noted the petition was filed within the limitation period, observing the petition date and the date of last payment, and concluded that default existed and the petition fell within the three year limitation period. On these foundations the Tribunal held that the requirements for admission under section 9 were satisfied and the petition was complete and maintainable. [Paras 12, 13]

The company petition under section 9 is admitted as default and limitation are established and the application is complete and maintainable.

Forfeiture of right to file reply - Whether the Corporate Debtor's right to file a reply was forfeited for non compliance - HELD THAT: - The Tribunal recorded that multiple opportunities were granted to the Corporate Debtor to file a reply. Despite such opportunities, the Corporate Debtor failed to file the reply and, accordingly, the Bench forfeited the right to file a reply. This procedural consequence was noted prior to adjudication on the merits. [Paras 10]

The right of the Corporate Debtor to file a reply was forfeited due to failure to avail repeated opportunities.

Moratorium - Imposition and scope of moratorium consequent to admission of the petition - HELD THAT: - Upon admitting the petition, the Tribunal imposed the moratorium as contemplated by the Code. The moratorium was ordered to operate from the date of the order until completion of CIRP or approval of a resolution plan or liquidation, and its ordinary effects were specified, including stay of suits, prohibition on transfer or encumbrance of assets, restriction on enforcement of security, and protection of recovery of property by owners/lessors. The order also clarified continuance of supply of essential goods or services and that certain notified transactions would be excluded from the moratorium in terms of law. [Paras 16]

A moratorium under section 14 is declared with the specified scope and temporal effect from the date of the order until completion of CIRP or other terminal events.

Appointment of Interim Resolution Professional - Appointment of an Interim Resolution Professional and vesting of management functions - HELD THAT: - The Tribunal appointed an Insolvency Professional as Interim Resolution Professional to conduct the CIRP and to exercise functions under the Code. The order directed that management of the Corporate Debtor shall vest in the IRP during the CIRP period and required officers and managers to furnish documents and information to the IRP within a specified time, failing which coercive action would follow. The IRP's fees were to comply with IBBI regulations. [Paras 16]

An IRP is appointed and management of the Corporate Debtor vests in the IRP for the CIRP period, with attendant duties and compliance directions.

Procedural deposit to meet CIRP expenses - Obligation of the Operational Creditor to deposit funds to meet CIRP publicity and claims invitation expenses - HELD THAT: - As part of directions on initiating CIRP, the Tribunal directed the Operational Creditor to deposit a specified sum with the IRP to meet expenses relating to public announcement and inviting claims; such expenses would be subject to approval by the Committee of Creditors. This obligation formed part of the directions issued on admission. [Paras 16]

The Operational Creditor is directed to deposit the specified sum with the IRP to meet CIRP publicity and claims inviting expenses, subject to CoC approval.

Final Conclusion: The Tribunal admitted the section 9 petition, held that default and limitation were established, forfeited the Corporate Debtor's right to file a reply for non compliance, declared a moratorium, appointed an IRP with vesting of management, and directed the Operational Creditor to deposit funds to meet CIRP publicity and claims inviting expenses.

Voluntary Liquidation - Declaration of Solvency - Public Announcement for claims and sale of assets - Final report and distribution to contributories - Compounding of offence and compliance with compounding order - Dissolution under Section 59(8) of the Insolvency and Bankruptcy Code, 2016

Voluntary Liquidation - Declaration of Solvency - Public Announcement for claims and sale of assets - Final report and distribution to contributories - Whether the corporate person complied with statutory requirements for commencement and completion of voluntary liquidation and whether dissolution should be ordered. - HELD THAT: - The Tribunal found that the Board passed the resolution to commence voluntary liquidation and the members approved the special resolution; a liquidator was appointed. Declarations of solvency and accompanying audited financial statements and assets-and-liabilities statements were filed with the Registrar of Companies. The liquidator published statutory public announcements, invited and received claims, procured valuation, advertised and effected sale of the investment, received earnest money and the sale consideration, prepared and placed the preliminary and final reports before contributories, and obtained unanimous approval in the contributory meeting. The liquidator submitted the final report to IBBI and ROC, closed bank accounts after payment of liquidation expenses and distribution of remaining proceeds to contributories, and obtained bank closure certificates. The Tribunal recorded that the company had no creditors and that all debts were discharged to the satisfaction of creditors, and that proper books of account were maintained. On these findings the Tribunal concluded that the liquidation process had been conducted in compliance with applicable provisions and formalities, warranting dissolution. [Paras 10, 11]

The corporate person satisfied the statutory requirements for voluntary liquidation and, accordingly, the petition for dissolution is allowed.

Compounding of offence and compliance with compounding order - Dissolution under Section 59(8) of the Insolvency and Bankruptcy Code, 2016 - Whether a prior prosecution/compounding order under the Companies Act affected the maintainability of the dissolution order. - HELD THAT: - ROC had earlier initiated prosecution under section 203, which was the subject of a compounding application before the Regional Director. The Tribunal examined records and submissions that the Regional Director had compounded the offence and that the company filed the certified order and proof of payment of compounding fee in INC-28. The ROC later withdrew the case pending before the Chief Judicial Magistrate, Shillong. The liquidator also produced evidence of having communicated with the Income Tax Department as directed. The Tribunal found that there were no pending litigations affecting the company's financial position and that compliance with the compounding order had been demonstrated. [Paras 7, 8, 10, 11]

The prior prosecution/compounding matter did not preclude dissolution as the compounding order was complied with and the prosecution was withdrawn; dissolution may be ordered.

Final Conclusion: The petition for dissolution of M/s NEFA Road Carrier Pvt. Ltd. under the voluntary liquidation process is allowed; the company is ordered to be dissolved with effect from 16.09.2022, and the liquidator is directed to communicate this order to ROC (NER), IBBI and other concerned authorities.

Moratorium under Section 14(1)(d) - Wrongful possession - Unjust enrichment - Rights of third-party owners during CIRP - Necessary party and non-joinder

Moratorium under Section 14(1)(d) - Wrongful possession - Unjust enrichment - Rights of third-party owners during CIRP - Whether the protection against dispossession under the moratorium applies to property in the possession of the corporate debtor where such possession is wrongful and the property belongs to third parties. - HELD THAT: - The Tribunal held that the statutory protection in Section 14(1)(d) - which prevents dispossession of property in the possession of a corporate debtor during the moratorium - presupposes lawful possession by the corporate debtor. Where the corporate debtor's possession is wrongful (as established by a final order of the High Court recognising third-party ownership and APIICL's admission of mistake), Section 14(1)(d) cannot be stretched to protect such possession. Extending the moratorium to assets not rightfully held by the corporate debtor would permit unjust enrichment of the corporate debtor and frustrate the third party's proprietary rights, contrary to the purpose of the Code. The Tribunal also noted that the Resolution Professional's communication to potential bidders about the disputed status of the lands and his willingness to comply with the High Court order supported granting relief to the land-owners. The determinative reasoning is that the moratorium's object (protecting value of corporate debtor as a going concern) does not justify preserving assets that the corporate debtor never had a rightful entitlement to possess.

Section 14(1)(d) does not apply to properties which the corporate debtor holds wrongfully; the corporate debtor cannot rely on the moratorium to retain possession of such third-party lands.

Necessary party and non-joinder - Enforceable legal right - Whether APIICL is a necessary or proper party to the application and whether the application is vitiated by non-joinder. - HELD THAT: - Applying the principle that a party should be added only if a legally enforceable right of that party may be affected by the proceedings, the Tribunal observed that APIICL has admitted the mistake and the High Court order directing redelivery of the lands has attained finality. APIICL's position - that the lands should be handed over to the applicants in compliance with the High Court order - means that no enforceable right of APIICL would be prejudiced by allowing the present application. In those circumstances, non-joinder of APIICL did not render the application incompetent and APIICL need not be impleaded for the relief sought.

APIICL is not a necessary party; the application is not liable to be dismissed for non-joinder.

Final Conclusion: The application is allowed. The Resolution Professional is directed to forthwith hand over possession of the specified 40.23 acres to the applicants and file a compliance report within two weeks; the Resolution Professional may approach APIICL for allotment of equivalent land or remuneration to protect the corporate debtor's interests.

Refund of service tax on input services for export - limitation and time-bar under Notification No.9/2009-S.T. - discretion to extend limitation by Assistant Commissioner/Deputy Commissioner - condonation of delay - computation of limitation from date of actual payment - quarterly filing versus payment-date computation

Limitation and time-bar under Notification No.9/2009-S.T. - computation of limitation from date of actual payment - quarterly filing versus payment-date computation - Interpretation of clause 2(f) of Notification No.9/2009-S.T. prescribing the six months period for filing refund claims - HELD THAT: - Clause 2(f) prescribes that the claim for refund shall be filed within six months from the date of actual payment of service tax by the developer or unit to the service provider. The provision thus sets limitation from the date of actual payment. The Tribunal distinguished decisions relied upon by the appellant which apply where the notification specifically required quarterly filing; those decisions are not applicable where limitation is linked to the date of actual payment. The Tribunal also noted that the clause expressly contemplates discretion to permit an extended period under the authority of the Assistant Commissioner or Deputy Commissioner. [Paras 4]

Clause 2(f) is to be read as a six-month limitation from the date of actual payment, subject to the discretion of the Assistant Commissioner/Deputy Commissioner to extend the period.

Discretion to extend limitation by Assistant Commissioner/Deputy Commissioner - condonation of delay - Exercise of discretion under clause 2(f) to condone delay in filing refund claims where assessee filed late due to bona fide belief about quarterly filing - HELD THAT: - The notification vests discretion in the Assistant Commissioner/Deputy Commissioner to permit an extended period for filing refund claims. The appellant explained that it believed refund claims were to be filed on a quarterly basis and therefore computed limitation from the end of the quarter. The Tribunal found this confusion to constitute a reasonable cause for delay. In view of the discretionary power conferred by clause 2(f), and distinguishing authorities where no extension power existed, the Tribunal exercised the discretion in favour of the appellant and condoned the delay. [Paras 4, 5]

Delay in filing the refund claims is condoned and the appeals are allowed.

Final Conclusion: The Tribunal held that clause 2(f) of Notification No.9/2009-S.T. prescribes a six-month limitation from the date of actual payment but vests discretion in the Assistant/Deputy Commissioner to extend time; finding a reasonable cause in the assessee's bona fide belief about quarterly filing, the Tribunal exercised that discretion, condoned the delay and allowed the appeals.

Liquidated damages - service tax - deemed service under Section 66E(e) - consideration for a taxable service - recovery of liquidated damages not consideration for service

Liquidated damages - deemed service under Section 66E(e) - consideration for a taxable service - Demand of service tax on liquidated damages under Section 66E(e) of the Finance Act, 1994 was not sustainable. - HELD THAT: - The Tribunal considered prior coordinate Bench decisions which held that recovery of liquidated damages or penalty from a contracting party does not amount to payment for any activity performed by the recipient and therefore does not constitute 'consideration' for a taxable service. The purpose of liquidated damages is to ensure compliance and to compensate for breach; it is not a payment made to tolerate or permit a service by the defaulting party. The Bench observed that only in atypical commercial arrangements where a payment is made to procure or permit a service (for example, to secure exclusion of a supplier) could a deemed service under Section 66E(e) be attracted. Applying these principles and following the cited precedents, the Tribunal concluded that the Commissioner's view-that accepting liquidated damages amounted to toleration for a consideration and hence taxable under Section 66E(e)-could not be sustained. [Paras 7, 8]

Impugned order of demand set aside; appeal allowed with consequential benefits as per law.

Final Conclusion: The Tribunal set aside the demand of service tax on liquidated damages, holding that such recoveries do not constitute consideration for a taxable service under Section 66E(e), and allowed the appeal with consequential relief.

Sponsorship service - Exclusion of sponsorship of sports events - Taxability prior to 01.07.2010 - Reverse charge mechanism - Literal construction of exclusionary clause - Precedential effect of Tribunal and Supreme Court decisions

Sponsorship service - Exclusion of sponsorship of sports events - Taxability prior to 01.07.2010 - Reverse charge mechanism - Receipt of sponsorship by the appellant from BCCI-IPL for IPL T-20 cricket matches is not taxable as 'sponsorship service' for the periods prior to 01.07.2010 and therefore not exigible to service tax under the reverse charge mechanism in the appellant's hands. - HELD THAT: - The Tribunal examined the statutory definition of sponsorship service as it stood prior to amendment w.e.f. 01.07.2010 and noted that the definition expressly excluded services in relation to sponsorship of sports events. The payments made to BCCI-IPL were in relation to sponsorship of IPL T-20 cricket matches, which are sporting events; accordingly such receipts fell within the statutory exclusion operative before 01.07.2010. The Tribunal rejected the Revenue's contentions that commercial elements of IPL or the fact that payments were made to BCCI/IPL (an entity) removed the transaction from the exclusion, holding that the exclusionary clause admits of a literal construction and contains no limitation disapplying the exemption where the event has commercial aspects. The Tribunal relied on its earlier reasoning in respect of identical sponsorship arrangements (as in the Hero Honda line of decisions) and recorded that the same view was affirmed by the Supreme Court, which settled the question in favour of the assessees. Applying that precedent to the facts before it, the Tribunal concluded that the appellant was not liable to service tax on the sponsorship payments for the relevant periods and that the adjudication confirming tax, interest and penalty was unsustainable.

Impugned order confirming demand of service tax, interest and penalty is set aside; appeal allowed with consequential relief.

Final Conclusion: The Tribunal allowed the appeal, holding that sponsorship payments made to BCCI-IPL in relation to IPL T-20 cricket matches for the periods prior to 01.07.2010 fall within the exclusion for sponsorship of sports events and are not taxable under the reverse charge mechanism; the impugned demand is quashed in view of the Tribunal's earlier decision affirmed by the Supreme Court.

Interest on delayed refund - refund of amount deposited during investigation - interest under Section 11BB for delayed refund to run from expiry of three months from date of receipt of refund application - requirement of filing refund claim by the assessee - binding effect of Division Bench precedent

Refund of amount deposited during investigation - interest on delayed refund - requirement of filing refund claim by the assessee - Whether the appellants are entitled to interest on the amount refunded which had been deposited during investigation. - HELD THAT: - The appellants had deposited an amount during investigation which was appropriated against a confirmed demand; that confirming order was later set aside on appeal and the deposited amount was refunded but without any interest. The Tribunal examined whether interest was payable from the date of the appellate order or otherwise. Applying the settled principle that a refund claim must be filed by the assessee and that interest under the statutory scheme (Section 11BB) accrues only after expiry of three months from the date of receipt of the refund application, the Tribunal held that interest cannot be awarded from the date of the appellate order where the refund application was filed later. The Division Bench decision in Gyal M G Gases P Ltd on identical facts was treated as binding and determinative of the legal position in the present case.

Appeal dismissed; appellants are not entitled to interest from the date of the appellate order and interest, if any, would be governed by the statutory rule commencing after three months from filing of the refund application.

Final Conclusion: The appeal is dismissed; in view of binding precedent the tribunal affirmed that interest on the refunded amount is governed by the rule that interest under Section 11BB runs only from the expiry of three months after filing of the refund application and cannot be awarded from the date of the appellate order allowing the refund.

Refund of accumulated CENVAT credit under Rule 5 - entitlement to refund where only customs drawback availed - drawback of customs duty versus excise duty - time bar / limitation - remand for fresh consideration - examination of documentation discrepancies

Refund of accumulated CENVAT credit under Rule 5 - entitlement to refund where only customs drawback availed - drawback of customs duty versus excise duty - Refund under Rule 5 is admissible where the assessee has availed drawback of only the customs duty portion and not the excise duty portion. - HELD THAT: - The Tribunal found that the Commissioner (Appeals) rejected the refund solely on the ground that drawback had been availed, without distinguishing between customs and excise portions. Reliance was placed on earlier Tribunal decisions which have held that where only the customs-duty component of drawback is availed, the assessee remains eligible for refund of accumulated CENVAT credit under Rule 5. Applying those precedents to the undisputed factual position that the appellant availed drawback only of the customs portion, the Tribunal held there was no reason to deny the refund on that basis. [Paras 8]

Issue decided in favour of the appellant; refund on account of Rule 5 is not barred merely because customs drawback (and not excise drawback) was availed.

Time bar / limitation - examination of documentation discrepancies - remand for fresh consideration - Whether the refund claim is time-barred and the correctness of documentary discrepancies is remanded to the Commissioner (Appeals) for fresh adjudication. - HELD THAT: - The Tribunal observed that the Commissioner (Appeals) had not examined the question of limitation and had made no observations on several other contested documentary discrepancies noted by the lower authority. Consequently, rather than deciding those matters itself, the Tribunal directed remand to the Commissioner (Appeals) to determine whether the refund claim falls within the prescribed time and to re-examine the correctness of the discrepancies in documentation, granting adequate opportunity to the parties. [Paras 7, 9]

Matter remitted to the Commissioner (Appeals) to decide time-bar and documentary issues afresh and expeditiously.

Final Conclusion: The appeal is allowed in part: the Tribunal held that availing drawback of only the customs-duty component does not preclude refund under Rule 5 and remanded the remaining issues, including time-bar and documentation discrepancies, to the Commissioner (Appeals) for fresh and expeditious adjudication in respect of exports for July 2012 to September 2012.

Interpretation of Section 2(f) of the RTI Act - drawing of inferences and providing opinions under the RTI Act - access to information that is available and existing - provision of extracts of rules/notifications as information - suo motu disclosures under Section 4 of the RTI Act

Interpretation of Section 2(f) of the RTI Act - drawing of inferences and providing opinions under the RTI Act - access to information that is available and existing - Whether the CPIO is obliged under the RTI Act to interpret GST notifications or draw inferences/opinions to answer the appellant's query about the percentage of GST payable on an incentive. - HELD THAT: - The Commission held that the RTI Act entitles applicants to information that is available and existing in records and does not obligate a public authority to draw inferences, make deductions, or provide advice or opinions. Extending Section 2(f) to require CPIOs to furnish interpretations or conclusions would unjustifiably burden CPIOs and expose them to penal consequences for substantive determinations. The Commission relied on the established principle that public authorities need not furnish interpretation or opinion not already present in records, and thereby refused to treat the appellant's request for an interpretative determination as a requirement under the RTI Act.

The request for the CPIO to deduce or state the applicable GST percentage on the appellant's incentive was refused insofar as it required the CPIO to interpret or opine beyond providing existing records.

Provision of extracts of rules/notifications as information - access to information that is available and existing - suo motu disclosures under Section 4 of the RTI Act - Whether the appellant must be provided the relevant rules/notifications or extracts thereof relating to 'consideration' (the GST terminology relevant to his query) so as to enable him to identify the applicable GST treatment. - HELD THAT: - Although the Commission rejected any obligation on the CPIO to provide a bespoke interpretation, it took a liberal view to facilitate access to existing records directly relevant to the query. The CPIO was directed to supply an extract of the relevant rules/notifications concerning the term 'consideration' under GST which would suffice for the appellant to identify the applicable position regarding the amount termed as incentive. The Commission emphasised that public authorities should place common clarifications and authoritative orders in public view (e.g., via a FAQs section) in furtherance of disclosures envisaged by Section 4, and accordingly directed administrative follow-up.

The CPIO was directed to provide, free of cost within 15 days, an extract of the relevant rules/notifications pertaining to 'consideration' which would assist the appellant in ascertaining the GST treatment of the incentive.

Final Conclusion: The appeal is disposed of: the Commission held that the RTI Act does not require the CPIO to draw inferences or give an opinion on the GST percentage applicable to the appellant's incentive, but directed the CPIO to furnish an extract of the relevant rules/notifications on 'consideration' to the appellant within 15 days and advised the public authority to consider publishing common clarifications under Section 4.

Exemption under Section 6A of the Central Sales Tax Act, 1956 - Branch transfer exemption - Form F requirement - Power to rectify any error apparent on the face of the record under Section 55 of the Tamil Nadu General Sales Tax Act, 1959 - Effect of non-filing of appeal on binding nature of appellate finding - Appellate Tribunal's power to re examine facts on appeal despite earlier appellate finding - Interlocutory remand and fresh consideration of evidence

Branch transfer exemption - Form F requirement - Appellate Tribunal's power to re examine facts on appeal despite earlier appellate finding - Whether the Appellate Tribunal erred in dismissing the petitioner's challenge without re examining the claim of branch transfer on the collateral documents produced in the remand proceedings - HELD THAT: - The Court examined the sequence of proceedings: initial assessment (28.6.1996) disallowing exemption for lack of Form F; first appeal (11.12.1998) partly confirming disallowance and partly remanding certain turnover for verification; remand proceedings before the assessing officer (31.12.2002) where part of the remanded turnover was allowed on collateral documents though Form F remained unfiled; and the Appellate Tribunal's subsequent dismissal. Relying on the Full Bench decision in M. Syed Alavi (Ker.) and the Division Bench view followed in State of Tamil Nadu v. Sharada Enterprises, the Court held that the Appellate Tribunal is not bound by the earlier appellate finding and, as the ultimate fact finding authority, may examine the claim afresh. The Tribunal ought to have considered the additional documents produced in the remand proceedings and applied the settled law that, in appropriate circumstances, stock transfers may be substantiated by other evidence even when Form F is not produced. On this basis the impugned order was held unsustainable and the matter was remitted to the Appellate Tribunal for fresh consideration and adjudication on the merits, with liberty to the petitioner to produce documents and for the Tribunal to remit further if prima facie satisfied of genuineness. [Paras 11, 22, 23, 24]

Appellate Tribunal's order set aside; matter remitted to the Appellate Tribunal to re examine the branch transfer claim and evidence afresh in the light of the cited authorities, with a direction to decide within six months and hear the petitioner.

Power to rectify any error apparent on the face of the record under Section 55 of the Tamil Nadu General Sales Tax Act, 1959 - Effect of non-filing of appeal on binding nature of appellate finding - Interlocutory remand and fresh consideration of evidence - Whether the limitation under Section 55 (five year period) or the prior finality of the first appellate order precluded re opening or reconsideration of the assessment in the remand and appellate proceedings - HELD THAT: - The Court noted Section 55's five year window for rectification and the statutory scheme permitting exercise of rectification powers even where an original order has been the subject matter of an appeal (Section 55(3 A)). The record showed that Form F was not produced within the limitation period for some parts of the turnover; nevertheless, the assessing officer had accepted collateral documents for a portion of the remanded turnover. The Court did not apply Section 55 as an absolute bar to reconsideration by the Appellate Tribunal; rather it directed that the Tribunal should re examine the matter in the light of the law allowing consideration of other evidence and reconcile such consideration with the limitation principle and the circumstances of the remand. Consequently the question of limitation and rectification was remitted to the Tribunal for fresh determination in accordance with law. [Paras 20, 21, 24]

Question of applicability of Section 55 and limitation remitted to the Appellate Tribunal for fresh consideration while re examining the claim; no final ruling on limitation was made by this Court.

Final Conclusion: Writ petition allowed. The impugned order of the Appellate Tribunal is set aside and the matter is remitted to the Appellate Tribunal to re examine the branch transfer claim and related limitation/rectification issues in the light of the Full Bench decision in M. Syed Alavi and the decision in State of Tamil Nadu v. Sharada Enterprises, permitting the petitioner to be heard and to produce available documents; the Tribunal may further remit if prima facie satisfied of genuineness. To be decided within six months. No costs.

Power to direct interim compensation under Section 143-A of the Negotiable Instruments Act - Discretionary nature of interim compensation - Award of interim compensation where accused adopts delay or dilatory tactics - Irrelevance of trial merits (e.g., claim of security/blank cheque) at interim compensation stage - Interplay between summoning order/prima facie finding and exercise of power under Section 143-A

Power to direct interim compensation under Section 143-A of the Negotiable Instruments Act - Award of interim compensation where accused adopts delay or dilatory tactics - Validity of the order awarding 20% interim compensation under Section 143-A in view of the accused's conduct and delay in the proceedings. - HELD THAT: - The Court examined the scope of Section 143-A and the Statement of Objects and Reasons which justify conferring discretion on the trial court to award interim compensation up to 20% of the cheque amount in appropriate cases. The courts below found that the accused had repeatedly sought exemptions from personal appearance, occasioned issuance of bailable/non-bailable warrants and otherwise caused delay in the trial process. Those findings demonstrated dilatory tactics which fall within the illustrative circumstances contemplated by the legislative history for exercise of the power. Having regard to the record of repeated adjournments and the accused's conduct, the High Court concluded that no fault was made out in the exercise of discretion by the Trial Court and the Additional Sessions Judge in directing interim compensation to the complainant. [Paras 3, 6]

Order awarding interim compensation to the complainant was held validly exercised in the facts of the case.

Discretionary nature of interim compensation - Irrelevance of trial merits (e.g., claim of security/blank cheque) at interim compensation stage - Interplay between summoning order/prima facie finding and exercise of power under Section 143-A - Whether the Trial Court was required to examine merits of defence (such as that the cheque was a security/blank cheque or that complaint was a pressure tactic) while deciding an application under Section 143-A. - HELD THAT: - The Court held that Section 143-A is intended to provide interim relief to an aggrieved payee and that a full appraisal of merits at the interim stage would amount to a 'mini trial', defeating the purpose of the provision. Where the summoning order stands and is not challenged, issues going to the core merits (e.g., whether the cheque was given as security or was blank, or whether the complaint was a pressure tactic) are matters for trial and are not relevant to the exercise of discretion under Section 143-A. The High Court therefore endorsed the approach of the courts below in not undertaking a detailed merits inquiry while directing interim compensation. [Paras 7]

Merits-based contentions are not to be adjudicated in proceedings under Section 143-A; the Trial Court correctly refrained from conducting such mini-trial.

Discretionary nature of interim compensation - Award of interim compensation where accused adopts delay or dilatory tactics - Whether the High Court should interfere with the concurrently recorded findings of delay and the consequent exercise of discretion by the courts below. - HELD THAT: - The petition was essentially a reproduction of the defence contentions raised earlier before the Trial Court. The High Court observed that the issues raised pertained to defences that are triable at the trial stage and that the lower courts had considered the accused's conduct and the trial chronology in reaching their conclusion. Given that the discretion under Section 143-A had been exercised in the factual matrix of recurrent adjournments and non-appearance, the High Court found no ground to interfere with the orders challenged in the petition. [Paras 5, 6, 8]

High Court declined to interfere and dismissed the petition against the orders affirming interim compensation.

Final Conclusion: The petition under Section 482 Cr.P.C. was dismissed. The High Court upheld the Trial Court's and revisional court's exercise of discretion under Section 143-A to direct interim compensation (20% of the cheque amount) in view of the accused's dilatory conduct, and held that merits-based defenses are not to be examined at the interim compensation stage.

Offence under Section 138 of the Negotiable Instruments Act - presumption under Sections 118 and 139 of the Negotiable Instruments Act - probable defence to rebut the presumption under Section 139 - service of statutory demand notice as prerequisite for prosecution under Section 138 - limited revisional jurisdiction of the High Court under Section 397 Cr.PC

Offence under Section 138 of the Negotiable Instruments Act - service of statutory demand notice as prerequisite for prosecution under Section 138 - Conviction under Section 138 of the Negotiable Instruments Act was sustainable on the evidence led by the complainant. - HELD THAT: - The Court found that the complainant proved the issuance of the cheque, its dishonour for insufficiency of funds, and service of the demand notice together with proof of reply. Evidence included the cheque (Ext. CW-1/B), banker's memo of dishonour (Ext. CW-1/C/D) and demand notice with acknowledgment (Ext. CW-1/E, CW-1/F). The trial court and appellate court had examined and accepted these materials and this Court, on reappraisal limited by revisional jurisdiction, found no illegality in those findings. Accordingly, the statutory ingredients necessary to initiate and sustain prosecution under the negotiable instruments provision were held to be established. [Paras 10, 11, 12, 18, 22]

The conviction under Section 138 was upheld.

Presumption under Sections 118 and 139 of the Negotiable Instruments Act - probable defence to rebut the presumption under Section 139 - The accused failed to rebut the statutory presumption and did not establish a probable defence sufficient to negate the presumption that the cheque was issued for discharge of a legally enforceable debt. - HELD THAT: - Since issuance of the cheque and the signatures were not denied, the presumption under Sections 118 and 139 operated in favour of the complainant and the burden shifted to the accused to raise a probable defence on preponderance of probabilities. The accused's plea that the cheque was given as security or that payment was effected in cash was not probabilized by credible documentary evidence or testimony. Reliance on authorities was applied to hold that mere suggestions or unsubstantiated assertions do not discharge the accused's onus; the defence witnesses did not prove payment or other facts sufficient to rebut the presumption. [Paras 7, 8, 9, 13, 14]

The attempted defence that the cheque was a security or that the debt had been paid in cash was not proved and the presumption under Sections 118 and 139 was not rebutted.

Limited revisional jurisdiction of the High Court under Section 397 Cr.PC - This Court declined to exercise revisional power to re-appreciate evidence or interfere with concurrent findings of fact and law recorded by the courts below in absence of any glaring illegality or miscarriage of justice. - HELD THAT: - The High Court observed that its revisional jurisdiction is supervisory and not a second appellate jurisdiction; it would not ordinarily re-appreciate evidence where the magistrate and the appellate court have concurrently considered the evidence unless a material irregularity or gross miscarriage of justice is shown. Learned counsel for the accused did not point to any such error, and on perusal the Court found the lower courts' appreciation of evidence to be sound and reasoned, warranting no interference. [Paras 6, 19, 20, 21, 22]

The revision petition was dismissed and the concurrent judgments of conviction and sentence were upheld.

Final Conclusion: Revision petition dismissed; concurrent findings that the cheque was issued, dishonoured and that the accused failed to rebut statutory presumption were upheld, and the impugned convictions and sentence were maintained with direction for the petitioner to surrender to serve the sentence as awarded.