TaxTMI Updates e-Newsletter
Nov 02,2020

Transition of input tax credit - successful filing in Form GST TRAN-1 - writ of mandamus - IT Grievance Redressal Committee - digitisation and taxpayer convenience - transitional VAT credit as State Tax Credit

Successful filing in Form GST TRAN-1 - transition of input tax credit - writ of mandamus - IT Grievance Redressal Committee - digitisation and taxpayer convenience - Relief by writ directing respondents to consider and effect transition of credit after verification where Form GST TRAN-1 was admittedly filed successfully but the credit was not reflected in the electronic ledger. - HELD THAT: - The Court found as an admitted fact that the Petitioner successfully filed Form GST TRAN-1 on 27.12.2017 yet the claimed transitional credit did not appear in the electronic credit ledger. The respondents relied on the ITGRC finding that no technical error was found on the GSTN and refused to allow retransmission or portal re-opening. The Court rejected the proposition that mere absence of a recorded technical glitch on the GSTN would justify denial of the Petitioner's grievance where a successful filing had occurred and the credit was not reflected. The Court distinguished NELCO (where filing itself had failed) and Bhargava Motors (where incorrect entries were an issue) and emphasised that digitisation must serve to facilitate, not to defeat, legitimate claims of taxpayers. The court did not adjudicate the substantive entitlement to the VAT credit but exercised writ jurisdiction as an appropriate remedy to direct the administrative respondents to consider the claim on merits and verify the amount claimed before transitioning it into the electronic credit ledger. [Paras 19, 21, 22, 23, 24]

Petition allowed in part; respondents directed to consider the Petitioner's claim, verify the claimed amount and take necessary action to transition the credit into the Petitioner's electronic credit ledger within four weeks.

Transitional VAT credit as State Tax Credit - verification of VAT amount - Substantive entitlement to the claimed VAT transitional credit was not finally adjudicated and was left to the assessing/administrative authorities for merits-based verification. - HELD THAT: - The Court expressly refrained from deciding whether the Petitioner was entitled to the VAT credit claimed under Section 142(11)(c) (as pari materia in the Maharashtra Act) and noted that the merits of the VAT credit claim must be examined and verified by the competent authorities. The direction issued is limited to consideration and verification of the claimed VAT amount and, if found in order on merits, to effect the transition into the electronic credit ledger. The Court therefore remitted the question of entitlement and any factual or legal determinations necessary for acceptance of the credit to the respondents for fresh consideration. [Paras 5, 21, 24, 25]

The issue of entitlement to the claimed VAT transitional credit is remitted to the respondents for merits-based consideration and verification; the Court has not examined or decided the substantive claim.

Final Conclusion: Writ petition allowed in part. Without adjudicating the substantive entitlement to the claimed VAT credit, the respondents are directed to examine the Petitioner's TRAN-1 filing, verify the claimed transitional VAT amount on merits and, if found in order, transition the credit into the Petitioner's electronic credit ledger within four weeks; no order as to costs.

Regular bail under Section 439 Cr.P.C. - offences under Section 132 of the Punjab Goods and Services Tax Act, 2017 - arrest under Section 69 without jurisdiction - complaint triable by a Magistrate - initiation of prosecution under the Finance Act - custodial investigation not required - trial delay due to Covid-19 - release on bail subject to surrender of passport and furnishing of surety

Regular bail under Section 439 Cr.P.C. - custodial investigation not required - trial delay due to Covid-19 - Grant of regular bail to the petitioner - HELD THAT: - The Court found that the petitioner had been in custody for four months and fourteen days, that the trial would take time to conclude especially in view of the prevailing Covid-19 situation, and that the petitioner was not required for further custodial investigation. Balancing the custodial period already undergone, the likelihood of protracted trial and absence of necessity for continued custody, the Court concluded that liberty should be restored by granting regular bail. The learned trial Court/Duty Magistrate was directed to accept bail/surety bonds to the satisfaction of that Court, subject to conditions imposed by this Court.

Petitioner released on regular bail subject to furnishing of bail/surety bonds and compliance with stated conditions.

Offences under Section 132 of the Punjab Goods and Services Tax Act, 2017 - arrest under Section 69 without jurisdiction - complaint triable by a Magistrate - initiation of prosecution under the Finance Act - Validity of the arrest and maintainability/competence of prosecution - HELD THAT: - The Court observed that the criminal trial for offences under Section 132 of the PGST Act and the arrest under Section 69 were without jurisdiction and lacked backing of constitutional provisions. The Court also noted that a moot question of law exists regarding the stage of initiation of prosecution under the Finance Act and concluded that the complaint is triable by a Magistrate. Those jurisdictional and competence aspects informed the decision to grant bail.

Arrest and prosecution were held to be without jurisdictional support and the complaint is to be tried by a Magistrate; these findings supported the grant of bail.

Release on bail subject to surrender of passport and furnishing of surety - Conditions attached to grant of bail - HELD THAT: - The Court imposed standard conditions as part of bail: the petitioner shall furnish bail/surety bonds to the satisfaction of the trial Court/Duty Magistrate, surrender his passport before the concerned Court and shall not leave India without prior permission of the Court. These conditions were treated as necessary safeguards attendant to the order of release.

Grant of bail subject to surrender of passport, prohibition on leaving India without prior permission, and furnishing of bail/surety bonds.

Final Conclusion: Writ petition allowed; petitioner ordered to be released on regular bail on conditions including surrender of passport, furnishing of bail/surety bonds and not leaving India without prior permission; findings recorded that arrest and trial under the PGST provision lacked jurisdiction and the complaint is triable by a Magistrate.

Opportunity of hearing - natural justice - show-cause notice in Form GST MOV-10 - final order of confiscation in Form GST MOV-11 - confiscation under Section 130 of the GST Act, 2017 - remand for fresh hearing

Opportunity of hearing - natural justice - show-cause notice in Form GST MOV-10 - final order of confiscation in Form GST MOV-11 - confiscation under Section 130 of the GST Act, 2017 - remand for fresh hearing - Whether the final order of confiscation passed in Form GST MOV-11 dated 25th July, 2020 is vitiated for want of opportunity of hearing and requires quashing and remand. - HELD THAT: - The mobile squad intercepted the vehicle and issued a show-cause notice in Form GST MOV-10 calling upon the writ applicant to show-cause why the goods and conveyance should not be confiscated under Section 130 of the GST Act, 2017. The final order of confiscation in Form GST MOV-11 was, however, passed on the same date before the writ applicant was afforded any opportunity to meet the show-cause notice. The authority therefore denied the writ applicant the opportunity of hearing, a facet of natural justice. For this short but decisive procedural defect, the High Court quashed the impugned order of confiscation and remitted the matter to the authority concerned to issue fresh notice of hearing and afford the writ applicant an opportunity to be heard. The Court expressly refrained from expressing any opinion on the merits of the case. [Paras 6, 7, 8, 9, 10]

Impugned order of confiscation in Form GST MOV-11 dated 25th July, 2020 quashed and set aside; matter remitted for fresh hearing after issuance of notice; no opinion on merits.

Final Conclusion: The appeal is allowed; the order of confiscation dated 25th July, 2020 is quashed and the matter is remitted to the authority for issuance of fresh notice and disposal after affording the writ applicant an opportunity of hearing; the Court has not expressed any view on the merits.

Provisional attachment to protect revenue in certain cases - Requirement of credible material for formation of subjective opinion / reasonable belief - Judicial review of subjective satisfaction limited to existence of relevant material - Provisional attachment of bank accounts as a last resort and not to be used to harass assessee - Abuse of discretion / malice in law where attachment is based on non-existent or irrelevant material

Provisional attachment to protect revenue in certain cases - Requirement of credible material for formation of subjective opinion / reasonable belief - Validity of the order of provisional attachment of the five bank accounts under Section 83 of the Act. - HELD THAT: - The Court examined the Form GST DRC-22 and the record and concluded that the order of provisional attachment was the outcome of a mechanical exercise and was devoid of any reasons or material on the file to show formation of the requisite opinion. Although Section 83 contemplates a subjective opinion that attachment is necessary to protect government revenue, such opinion must be grounded on some credible material; the existence of relevant material is a precondition to formation of the opinion. The Court relied on established precedents to hold that while the sufficiency of reasons is not open to full scrutiny, the court may examine whether any material existed on which an honest and reasonable authority could have formed the opinion. In the present case no such material was disclosed or recorded, rendering the attachment unsustainable in law.

The provisional attachment of the five bank accounts was quashed as it was not supported by any credible material or disclosed reasons.

Provisional attachment of bank accounts as a last resort and not to be used to harass assessee - Abuse of discretion / malice in law where attachment is based on non-existent or irrelevant material - Whether the power under Section 83 may be exercised where there is no reasonable apprehension of thwarting revenue recovery and whether such power was exercised appropriately in the present case. - HELD THAT: - The Court reaffirmed that the power under Section 83 is drastic and must be exercised sparingly, only where there is a reasonable apprehension that the assessee may defeat ultimate recovery and where attachment is necessary as a last resort. Invocation of the power without substantive weighty grounds, or for collateral or irrelevant purposes, amounts to abuse of discretion or malice in law. Applying these principles, the Court found that the statutory conditions and the safeguards enumerated by earlier decisions (including consideration of revenue-neutral situations and output/input liabilities) were not met here, and the attachment could not be sustained.

The attachment was set aside because the statutory prerequisites and safeguards for invoking Section 83 were not fulfilled and the power appeared to have been exercised without proper application of mind.

Judicial review of subjective satisfaction limited to existence of relevant material - Whether the Court should permit the Department to take fresh action. - HELD THAT: - While quashing the impugned provisional attachment for lack of supporting material, the Court clarified that its order would not preclude the Department from taking fresh action strictly in accordance with law and the principles laid down regarding formation of opinion, availability of credible material, and use of attachment as a last resort. The Court therefore annulled the existing attachment but preserved the Department's statutory right to proceed lawfully.

The attachment was removed, subject to the Department's entitlement to initiate fresh proceedings in accordance with law and the legal principles explained by the Court.

Final Conclusion: Writ petition allowed. The order of provisional attachment of the five bank accounts is quashed and set aside for want of any disclosed or credible material to support formation of the requisite opinion under Section 83; the Department is, however, at liberty to proceed afresh strictly in accordance with law and the principles articulated by the Court.

Allowability of accounting provisions as deductible expenditure - treatment of provision for dam maintenance - classification of miscellaneous assets as plant and machinery for depreciation purposes - treatment of guarantee commission payable under state guarantee - application of Section 43B(f) to provision for leave encashment - remand for fresh adjudication to Assessing Officer - allowability of prior period expenses on crystallisation under mercantile system of accounting - capitalisation versus revenue treatment of interest on advances to contractors

Treatment of provision for dam maintenance - allowability of accounting provisions as deductible expenditure - Deletion of addition made by AO of provision for dam maintenance upheld. - HELD THAT: - The Tribunal accepted the CIT(A)'s finding that although the assessee retained the expenditure under a provision account, the expenditure for dam maintenance had in fact been incurred and was being held for settlement/adjustment with the Government. The CIT(A) relied on the Tribunal's earlier order in the assessee's own case for similar facts. Revenue failed to bring material to displace the finding that the provision related to genuinely incurred expenditure and had been consistently accounted for; accordingly the addition was deleted. [Paras 8]

Addition on account of provision for dam maintenance deleted; Revenue's ground dismissed.

Classification of miscellaneous assets as plant and machinery for depreciation purposes - Allowability of depreciation claimed on miscellaneous assets at 25% upheld. - HELD THAT: - The CIT(A) accepted the assessee's written submissions and particulars showing that the items subsumed under 'miscellaneous assets' were classified as plant and machinery and depreciation was claimed in accordance with the Income-tax Rules. Noting that no disallowance had been raised in the preceding year and that particulars were furnished, the Tribunal found no reason to disturb the CIT(A)'s conclusion and upheld the deletion of the disallowance made by the AO. [Paras 11]

Depreciation claim on miscellaneous assets allowed and AO's disallowance deleted.

Treatment of guarantee commission payable under state guarantee - Deletion of addition on account of excess provision for guarantee commission upheld. - HELD THAT: - The CIT(A) relied on a communication from the State Government which indicated that the guarantee amount had not been reduced and therefore guarantee commission was payable on the maximum guarantee amount irrespective of the outstanding loan. On the material before the CIT(A), the claim for guarantee commission was found to be in accordance with business requirement and allowable. Revenue did not place contrary material before the Tribunal to justify interference. [Paras 14]

Addition on account of excess provision for guarantee commission deleted; Revenue's ground dismissed.

Application of Section 43B(f) to provision for leave encashment - remand for fresh adjudication to Assessing Officer - Claim for provision for leave encashment restored to Assessing Officer for fresh adjudication. - HELD THAT: - In view of conflicting judicial developments on Section 43B(f) and following coordinate-bench decisions, the Tribunal remitted the matter to the AO for fresh consideration in the light of final pronouncements of the superior courts. The Tribunal observed that similar issues had been remitted in earlier decisions and directed fresh adjudication after affording the assessee opportunity of hearing. [Paras 21]

Issue remitted to the file of the AO for fresh adjudication (allowed for statistical purposes).

Non-disclosure of dues from Department of Water Resources (DOWR) - Addition for non-disclosure of dues from DOWR confirmed. - HELD THAT: - The assessee had conceded to the addition made by the AO and the CIT(A) accordingly upheld the AO's action. The Tribunal found no ground to interfere with the concession and the findings of the lower authorities. [Paras 22]

Addition for non-disclosure of dues from DOWR sustained; assessee's ground dismissed.

Allowability of prior period expenses on crystallisation under mercantile system of accounting - remand for fresh adjudication to Assessing Officer - Claim for prior period expenses remitted to Assessing Officer for examination of genuineness and crystallisation. - HELD THAT: - Relying on Tribunal precedent, the Bench observed that prior period expenses may be allowable where liabilities crystallized in the relevant year under mercantile accounting, but the AO must be given an opportunity to examine evidence of crystallisation. Given earlier coordinate-bench decisions and the need to test evidentiary support, the Tribunal restored the issue to the AO with directions to afford the assessee hearing and examine genuineness and crystallisation. [Paras 25]

Prior period expenses remitted to AO for fresh adjudication (allowed for statistical purposes).

Capitalisation versus revenue treatment of interest on advances to contractors - remand for fresh adjudication to Assessing Officer - Addition for interest on advances to contractors remitted to Assessing Officer for determination of nature of advances. - HELD THAT: - The AO treated accrued interest on advances to contractors as chargeable income. The Tribunal directed the AO to examine whether the advances were made during construction and hence required to be capitalised (in which case interest would be capitalised) and to allow the assessee's claim if so established. The matter was therefore restored to the AO for factual examination and verification after giving the assessee a reasonable opportunity. [Paras 26]

Issue remitted to AO for fresh consideration (allowed for statistical purposes).

Final Conclusion: For Assessment Year 2005-2006 the Tribunal dismissed the Revenue appeal and (i) upheld deletion of additions relating to provision for dam maintenance, depreciation on miscellaneous assets and guarantee commission; and (ii) partly allowed the assessee's appeal by remitting the issues of provision for leave encashment, prior period expenses and interest on advances to contractors to the Assessing Officer for fresh adjudication; the addition for non-disclosure of dues from DOWR was sustained.

TP Adjustment - ALP of the guarantee commission charges provided by the Respondent Co. - Disallowance u/s 36(1)(iii) - acquisition of business by way of investing into shares of that company through either Special Purpose Vehicle or directly cannot be considered to be ordinary event of the business and therefore, cannot be termed as expenditure incurred for the purpose of assessee’s business, which is providing ITES services -

The Court [2019 (10) TMI 760 - BOMBAY HIGH COURT] declined to entertain the questions on ALP and share-application-money as they were concluded by an earlier order, and upheld the Tribunal's factual finding that interest and finance expenses on loans taken to acquire a company in the same line of business are deductible under section 36(1)(iii) - HELD THAT: Special Leave Petitions are dismissed on the ground of delay.

Professional fees for filing income tax returns - official liquidator's obligation under section 139 of Income Tax Act - permission to make payment to professional retained by Official Liquidator

Professional fees for filing income tax returns - official liquidator's obligation under section 139 of Income Tax Act - permission to make payment to professional retained by Official Liquidator - Enhancement of professional fees payable for filing income-tax returns of companies in liquidation and authority to the Official Liquidator to make payment to the chartered accountants engaged for that purpose. - HELD THAT: - The Court considered the Official Liquidator's request for upward revision of the remuneration previously fixed by order dated 03.05.2013 and noted the statutory obligation on the Official Liquidator to file income-tax returns and pay tax dues of companies in liquidation under section 139 of the Income Tax Act. Having regard to the earlier fixation, the Office request dated 05.09.2020, and the number of companies in liquidation, the prayer for enhancement was held reasonable. The Court exercised its supervisory power to revise the professional fee and to permit payment to the chartered accountant firm identified in the report, while limiting the increase to a moderate level. [Paras 5, 6, 7]

Professional fees for filing income-tax returns of each company in liquidation fixed at Rs. 2,000 per company; Official Liquidator permitted to make payment to the chartered accountants as recorded in the report; present Official Liquidator's Report allowed to that extent.

Final Conclusion: The Official Liquidator's report is allowed in part: the professional fee for filing income-tax returns of each company in liquidation is enhanced to Rs. 2,000 and the Official Liquidator is authorised to make payment to the concerned chartered accountants as per the report.

Disallowance under Section 14A of the Income Tax Act read with Rule 8D - investment in wholly owned subsidiary companies as commercial/business purpose not for earning exempt income - applicability of Section 43A to premium on conversion of Indian currency loan into foreign currency loan

Disallowance under Section 14A of the Income Tax Act read with Rule 8D - investment in wholly owned subsidiary companies as commercial/business purpose not for earning exempt income - Provisions of Section 14A read with Rule 8D do not apply where investments were made in wholly owned subsidiary companies and no exempt income was received. - HELD THAT: - The Tribunal found, and this Court concurred, that the assessee's investments were made in wholly owned subsidiary companies and consequently could not be construed as investments for the purpose of earning exempt income. In that factual backdrop, and having found no exempt income, the Tribunal declined to apply Section 14A/Rule 8D and the High Court confirmed that conclusion. The Court distinguished the decision relied upon by the Revenue (Indiabulls) on the ground that in that case substantial exempt income had been reported and the question was application of Rule 8D where exempt income existed. Given the Tribunal's factual finding that the investments were for business purpose and there was no exempt income, Section 14A/Rule 8D was held not attracted and the Tribunal's order was confirmed. [Paras 4, 7, 8]

Tribunal's finding that Section 14A/Rule 8D is not attracted was upheld and the disallowance was not sustained.

Applicability of Section 43A to premium on conversion of Indian currency loan into foreign currency loan - Proposition that Section 43A is attracted to the premium paid on conversion of an Indian currency loan into foreign currency loan was answered against the Revenue. - HELD THAT: - The Court recorded that the question regarding the nature and allowability of the premium on conversion of the loan had been considered and decided against the Revenue in the assessee's own case in T.C.A.No.345 of 2020 dated 16.10.2020. Accordingly, the Substantial Question framed on Section 43A was answered in favour of the assessee consistent with that earlier decision. [Paras 3, 8]

The Second Substantial Question of Law on Section 43A was answered against the Revenue, following the Court's earlier decision in the assessee's case.

Final Conclusion: The Tax Case Appeal is dismissed; the Substantial Questions of Law are answered against the Revenue and the Tribunal's order is confirmed.

Validity of reference to Transfer Pricing Officer - Reference under Section 92CA for determination of Arm's Length Price - Transfer pricing risk parameters - Computer Aided Scrutiny Selection (CASS) - Approval of Principal Commissioner for reference to TPO - Computation of Arm's Length Price (ALP)

Validity of reference to Transfer Pricing Officer - Transfer pricing risk parameters - Computer Aided Scrutiny Selection (CASS) - Approval of Principal Commissioner for reference to TPO - Computation of Arm's Length Price (ALP) - Reference dated 19.12.2018 to the Transfer Pricing Officer for determination of ALP was valid and within jurisdiction and the Assessing Officer followed requisite procedure in seeking and obtaining approval. - HELD THAT: - The court examined the sequence of events and documentary record showing that the case was selected through CASS on a TP risk parameter (large aggregate employee cost relative to aggregate international transactions as per Form 3CEB). The Assessing Officer gathered basic details from Form 3CEB and other records, formed a prima facie belief that a reference to the TPO was necessary, and sought prior approval from the Principal Commissioner as required by the Board's guidance (Instruction No.15/2015 and paragraph 3.4). The AO's letter dated 17.07.2018 explicitly set out the international transactions and enclosed Form 3CEB and CASS reasons; the Principal Commissioner granted approval on 24.07.2018. The petitioner's submission that the scrutiny was confined to a mere numerical reconciliation between Form-3CEB and the return was held to be an oversimplification of the recorded CASS reason and not fatal to the reference. The court further noted that after interim protection lapsed the assessee participated in proceedings, filed replies and objections before the DRP. On these grounds the reference and consequent proceedings were held lawful. [Paras 11, 12, 14]

Reference dated 19.12.2018 to the TPO for AY 2016-17 was valid; the procedure for seeking and granting prior approval was complied with and the writ petitions are dismissed.

Final Conclusion: The writ petitions challenging the reference to the Transfer Pricing Officer and consequent assessment proceedings for AY 2016-17 are dismissed; the court finds the reference and the approval process to have been valid and within jurisdiction.

Interpretation of Section 50C of the Income tax Act - Adoption of stamp duty / guideline value as deemed sale consideration - Actual sale consideration recorded in the registered deed - Reassessment proceedings reopened under Section 148 - Computation of long term capital gains

Interpretation of Section 50C of the Income tax Act - Adoption of stamp duty / guideline value as deemed sale consideration - Actual sale consideration recorded in the registered deed - Whether the Assessing Officer and the appellate authorities were correct in adopting the enhanced stamp duty value fixed by the Sub Registrar/DRO in July 2011 as the sale consideration for a sale effected in June 2009 for the purpose of computing capital gains under Section 50C. - HELD THAT: - The Court found that the deed of conveyance recorded the sale consideration actually received by the assessee at the rate of Rs. 400 per square foot, totaling the consideration shown in the registered instrument. The Sub Registrar, for the purpose of levy of stamp duty, determined a higher guideline/stamp duty value (Rs. 555 per square foot) when the document was presented for registration. The Assessing Officer, on reopening assessment, adopted the higher value fixed by the Sub Registrar/DRO and recomputed sale consideration under Section 50C, despite there being no dispute that the assessee had received only the consideration shown in the deed. The Tribunal failed to notice or rectify this fundamental factual and legal error. On the facts and record before the Court, adopting the enhanced stamp duty value in place of the actual consideration reflected in the registered deed was erroneous, and the order adopting such enhanced value could not be sustained. [Paras 3, 4]

The Tribunal's order is set aside; the adoption of the enhanced stamp duty value by the Assessing Officer and continued by the authorities was held to be erroneous and the substantial questions raised are answered in favour of the assessee.

Final Conclusion: Tax Case Appeal allowed; impugned Tribunal order dated 15.03.2017 in I.T.A.No.2991/Mds/2016 set aside and substantial questions of law decided in favour of the assessee.

Summary order. Appeal disposed directing the assessee to file a declaration in Form I under the Direct Tax Vivad Se Vishwas Act, 2020 by 09.11.2020; the designated authority to process the declaration and pass appropriate orders preferably within six weeks; substantial questions of law left open; liberty granted to restore the appeal if the declaration decision is adverse; no costs.

Direct Tax Vivad Se Vishwas Act, 2020 - declaration under Section 4 - termination of disputed tax by payment - immunity from initiation of proceedings and penalty - liberty to restore proceedings if settlement is not favourable

Declaration under Section 4 - termination of disputed tax by payment - liberty to restore proceedings if settlement is not favourable - Disposition of the appeals by permitting the assessee to avail the Vivad Se Vishwas Scheme and directing filing and processing of the declaration, with liberty to restore the appeals if the settlement is not in the assessee's favour. - HELD THAT: - The High Court declined to decide the substantial questions of law framed on the Revenue's challenge because the assessee sought to avail the mechanism under the Direct Tax Vivad Se Vishwas Act, 2020, which permits a declarant to file a declaration under Section 4 to determine the amount payable and to end pending tax disputes. The Court summarised the statutory scheme, noting the provisions governing disputed tax, the method of determination of amount payable under Section 3, the particulars to be furnished under Section 4, the time and manner of payment, and the immunity from initiation of proceedings or imposition of penalty in certain cases. In view of these subsequent developments, the Court directed the assessee to file Form No.I by a specified date and directed the competent authority to process the declaration expeditiously, preferably within six weeks of filing. The Court further granted the assessee express liberty to seek restoration of the appeals without any application for condonation of delay if the outcome of the declaration is not favourable, and directed the Registry to place such restoration petitions before the Division Bench for orders.

Appeals disposed directing the assessee to file Form No.I under the Vivad Se Vishwas Act by the specified date, directing expeditious processing of the declaration, and granting liberty to restore the appeals if the declaration's outcome is not favourable; substantial questions of law left open.

Final Conclusion: The High Court disposed of the Tax Case Appeals without adjudicating the substantive questions, directing the assessee to file the declaration under the Direct Tax Vivad Se Vishwas Act, 2020 and permitting restoration of the appeals if the settlement under the Act proves unfavourable.

Revisional power under Section 263 - Prejudicial to the interests of Revenue - Year of chargeability for capital gains - Quashing of Section 263 order - Infructuous appeals - Effect of quashing of Section 263 order

Revisional power under Section 263 - Prejudicial to the interests of Revenue - Year of chargeability for capital gains - Quashing of Section 263 order - Whether the order of the Commissioner under Section 263 was correctly set aside because the reassessment was not shown to be prejudicial to the interests of Revenue. - HELD THAT: - The Tribunal found that the Assessing Officer, while reframing the assessment under section 143(3) read with section 147, had examined the material on record and taken a definite view that the year under appeal (the previous year ending 31-3-97 relevant to A.Y. 1997-98) was not the year of transfer for chargeability of capital gains. The Tribunal held that treating the year of chargeability as that chosen by the AO was a possible view and not shown to be erroneous. Further, the capital gains in question were taxed in subsequent assessment years (1998-99 to 2000-01). On these facts the Tribunal concluded that the Section 263 order could not be said to be prejudicial to the interests of Revenue and therefore quashed the revisional order. The High Court, noting these findings and the further fact that the assessees have since died and the tax had been assessed in later years, held that no question of law arises for its consideration and affirmed dismissal of the Revenue's challenge to the Tribunal's quashing of the Section 263 order.

Tribunal's quashing of the Commissioner's Section 263 order upheld; Section 263 order not shown to be prejudicial to Revenue.

Infructuous appeals - Effect of quashing of Section 263 order - Whether the assessees' appeals against orders giving effect to the Section 263 order for A.Y. 1997-98 are maintainable or have become infructuous. - HELD THAT: - The Tribunal observed that having quashed the Section 263 orders, the consequential orders purportedly giving effect to those Section 263 orders no longer have any basis and therefore stand in vacuum. Consequently, the appeals filed by the assessees against the orders giving effect to the Section 263 orders were treated as infructuous. The High Court recorded that because the Section 263 orders were quashed and the capital gains were taxed in subsequent years, there is no substantive question of law to be adjudicated, and the assessees' appeals against the consequential orders are to be dismissed as infructuous.

Assessees' appeals against orders giving effect to the quashed Section 263 orders dismissed as infructuous.

Final Conclusion: The Revenue's appeals are dismissed; the Tribunal's quashing of the Commissioner's Section 263 order is sustained and the consequential appeals by the assessees against orders giving effect to the quashed Section 263 orders are dismissed as infructuous. No costs.

Fee for technical services - Make Available clause - double taxation avoidance agreement - intermediary services - permanent establishment - attribution of profits to PE - offshore supply - place of business / place of disposal

Fee for technical services - Make Available clause - double taxation avoidance agreement - intermediary services - Whether amounts received by the assessee for intermediary services rendered to its Indian associated enterprise constitute taxable fees for technical services under the India-Sweden DTAA (in light of the 'Make Available' requirement). - HELD THAT: - The Tribunal accepted that the assessee, a Swedish tax resident and hub for the group's Rail Control Solutions business, rendered intermediary services (marketing, sales, project management, customer services, design development) to its Indian associated enterprise. Applying the DTAA and Protocol 7, the Tribunal held that the taxability of FTS requires that the service make technical knowledge, skill or technology available to the recipient so that the recipient can apply it independently in the future. The provision of services that merely involve technical effort or assistance does not, by itself, amount to making technology available. Relying on the twin test of rendering services and making technical knowledge available (with support drawn from De Beers), the Tribunal found on the facts that the intermediary services did not 'make available' technical knowledge or skill to the Indian recipient and therefore did not amount to FTS; consequently such receipts are not taxable in India as FTS. [Paras 24, 25, 26]

Intermediary services rendered by the assessee do not satisfy the 'Make Available' requirement and do not constitute fees for technical services; Grounds 4 to 6 are allowed.

Permanent establishment - attribution of profits to PE - offshore supply - place of business / place of disposal - Whether the assessee had a permanent establishment in India (in the form of its Indian associate) and whether income from offshore supplies should be attributed to such PE on a gross basis. - HELD THAT: - The Tribunal analysed the DRP's findings and documentary record, including the MoU and the split of scope between BT Sweden and BT India. It found that supplies under the BS-02 agreement were offshore supplies manufactured and sold outside India, with payment received outside India. The Tribunal also concluded that the DRP had relied on incorrect contracts and facts (confusing RS-02 with BS-02 and misattributing a seconded employee to the BS-02 contract), and had therefore erred in holding BT India to be the assessee's PE. Citing authorities that only income attributable to operations carried out in India can be taxed, and noting that the parties' roles and scope were expressly bifurcated in the MoU (offshore scope for BT Sweden and onshore scope for BT India), the Tribunal found no place of business or disposal in India through which the appellant conducted the offshore supplies. In consequence, the attribution and the addition made by the DRP were unsustainable. [Paras 40, 44]

Findings of PE and gross attribution are based on erroneous appreciation of facts; the addition attributable to PE is deleted and Grounds 7 to 14 are allowed.

Final Conclusion: The appeal is allowed: the intermediary receipts are not taxable in India as fees for technical services under the DTAA (no 'Make Available'), and the addition on account of a permanent establishment and attributable profits is deleted; the Assessing Officer is directed to give effect to these conclusions.

Deduction of business expenses during lull / going concern - Unexplained credit u/s. 68 - Disallowance of expenditure as unexplained expenditure u/s. 69C - Depreciation as allowable deduction under concept of block of assets - Disallowance of expenditure attributable to tax exempt income u/s. 14A - Nexus between expenditure and income

Unexplained credit u/s. 68 - Disallowance of expenditure as unexplained expenditure u/s. 69C - Nexus between expenditure and income - Validity of additions by the AO treating Rs.6,00,000 as unexplained credit and treating rental and other business expenditures as unexplained expenditure / disallowing business expenditure - HELD THAT: - The Tribunal held that the addition of Rs.6,00,000 under the principle of unexplained credit was not sustainable. The identity and capacity of the payer (VHPL) were not disputed, TDS was deducted on the payment and the AO's own findings showed close operational connection between the assessee and VHPL; therefore genuineness of the receipt could not be impugned merely because the payor could not explain services. As regards rental and other expenditure treated as unexplained u/s.69C, the Tribunal accepted the assessee's explanation (supported by notes to accounts) that the balance rent related to accommodation provided to the director and that only a small portion related to a godown was correctly allowed; the addition under s.69C was thus not justified. The Tribunal examined the overall nexus of claimed expenditures with the assessed streams of income and found no evidence that the business had ceased; on the facts there was only a temporary lull. Reliance was placed on judicial authority holding that expenses incurred to keep a going concern alive during periods of inactivity are deductible (Lawrence D'Souza and Inderchand Hari Ram were cited). Applying this principle, the Tribunal concluded that the AO erred in disallowing the claimed business expenditures and directed that the expenses be allowed. [Paras 19, 20, 23, 24]

The addition of Rs.6,00,000 under s.68 and the treatment of rental and other business expenditures as unexplained were set aside and the claimed business expenses were allowed.

Depreciation as allowable deduction under concept of block of assets - Deduction of business expenses during lull / going concern - Permissibility of depreciation claim (including on a vehicle) and employee cost where AO disallowed entire depreciation and employee costs on account of alleged absence of business activity - HELD THAT: - The Tribunal observed that depreciation is statutorily allowable in accordance with the concept of block of assets and cannot be wholly disallowed merely because the AO found reduced business activity. The AO could, on evidence, disallow depreciation attributable solely to personal use of a particular asset, but there was no material showing that the vehicle was used only for personal purposes; the assessee had shown business use. Similarly, salaries paid to three employees were admitted and thus deductible. The Tribunal concluded that disallowing the entire depreciation and employee cost for want of revenue flow was unsustainable, particularly where the enterprise continued as a going concern and incurred expenditure to maintain operations. [Paras 21, 22, 23]

Depreciation (including on the vehicle) and employee costs were held allowable; the AO's blanket disallowance was set aside.

Disallowance of expenditure attributable to tax exempt income u/s. 14A - Whether a separate disallowance under section 14A was warranted in addition to the disallowance already reflected in the assessee's computation and in the assessment - HELD THAT: - The Tribunal examined the computation of total income and noted that the assessee's return and the AO's assessment position already reflected a larger quantum of disallowance for expenditure relating to exempt income than the AO separately computed under s.14A. The starting point in the assessment was the loss declared by the assessee which subsumed the earlier s.14A disallowance. Given that the assessee's own computation showed a greater disallowance and that the AO's assessment proceeded from that figure, the Tribunal held that making a further separate disallowance under s.14A in the assessment order was not warranted in the facts of the case. [Paras 26, 28]

No separate disallowance under section 14A was justified; the AO's additional disallowance under s.14A was deleted.

Final Conclusion: The Tribunal partly allowed the appeal for AY 2010-11: the addition of Rs.6,00,000 treated as unexplained credit and the disallowance of business expenditures (including depreciation and employee cost) were set aside and the expenditures allowed; no separate disallowance under section 14A was warranted.

Validity of assessment under section 153A in absence of incriminating material - Requirement of incriminating material for addition in concluded assessment - Invocation of section 153A and its scope - Power of first appellate authority to remand after amendment to section 251

Validity of assessment under section 153A in absence of incriminating material - Requirement of incriminating material for addition in concluded assessment - Invocation of section 153A and its scope - Whether notices and assessments under section 153A for the years 2008-09 and 2009-10 were valid in circumstances where original assessments had been completed and there was no clear finding of incriminating material seized in the search. - HELD THAT: - The Tribunal observed that the authorities below and the CIT DR proceeded on the view that incriminating material or undisclosed income need not be found for issuance of notice under section 153A. The Bench considered the relevance of the Karnataka High Court decision invoked by Revenue but noted that that decision involved incriminating material having been unearthed. In the light of Supreme Court authority (CIT v. Sinhagd Technical Education Society) and the line of decisions relied upon by the assessee, the Tribunal held that, absent a clear finding that incriminating material or unaccounted money pertaining to the concluded assessment years was discovered in the search, the validity of proceeding under section 153A could not be finally determined. Consequently the Tribunal remanded the question to the first appellate authority for fresh consideration on whether any incriminating material relating to the years under consideration was found in the search; if the assessee succeeds on that legal point, no further adjudication on merits is necessary, but if the assessee fails then merits are to be decided afresh by the CIT(A) in accordance with law. [Paras 14, 15, 16]

Issue remanded to the CIT(A) for fresh consideration on whether incriminating material/unaccounted income pertaining to AY 2008-09 and AY 2009-10 was unearthed in the search; merits to be decided thereafter only if the legal ground fails.

Power of first appellate authority to remand after amendment to section 251 - Whether the Commissioner (Appeals) can remand issues to the Assessing Officer after the amendment to section 251. - HELD THAT: - The Tribunal noted that the CIT(A) had remanded certain issues to the Assessing Officer. Citing the amended statutory scheme, the Bench held that after the amendment to section 251 the CIT(A) lacks jurisdiction to remand issues to the AO and is required to decide the matters himself. On that basis the Tribunal set aside the remands made by the CIT(A) and directed that the CIT(A) should first decide the legal ground raised by the assessee (concerning invocation of section 153A) and thereafter decide the issues on merits if necessary. [Paras 17]

Orders of the CIT(A) remanding issues to the Assessing Officer set aside; CIT(A) directed to decide the legal ground first and then decide merits himself if required.

Final Conclusion: The appeals and cross appeals were allowed for statistical purposes: the question whether section 153A could validly be invoked for AY 2008 09 and AY 2009 10 without incriminating material was remanded to the CIT(A) for fresh consideration in accordance with law (and merits to follow only if that legal ground fails), and the CIT(A)'s remands to the Assessing Officer were set aside with a direction that the CIT(A) decide the matters himself.

Disallowance under Section 14A read with Rule 8D - assessing officer's satisfaction requirement under Section 14A(2) - application of the apportionment theory to exempt income - limited scope of Rule 8D where assessee has made suo moto apportionment

Disallowance under Section 14A read with Rule 8D - assessing officer's satisfaction requirement under Section 14A(2) - Validity of invoking Rule 8D to compute disallowance under Section 14A where the Assessing Officer did not record dissatisfaction with the assessee's own apportionment - HELD THAT: - The Tribunal held that sub section (2) of Section 14A conditions the AO's power to compute disallowance under Rule 8D upon a recorded satisfaction that, having regard to the assessee's accounts, the AO is not satisfied with the correctness of the assessee's claim. The AO in the present case used identical language across years and proceeded to apply Rule 8D without recording any such dissatisfaction or examining books of account; the AO also misconstrued factual aspects (treating stock in trade as investments and attributing borrowed funds) contrary to precedents. Following earlier decisions in the assessee's own proceedings for preceding years and consistent High Court and Supreme Court dicta, the Tribunal found the AO's invocation of Rule 8D impermissible in the absence of the requisite satisfaction and held that the suo moto disallowance made by the assessee meets the requirement of Section 14A, so no further disallowance could be sustained. [Paras 5, 6]

CIT(A)'s deletion of the excess disallowance and restriction to the assessee's suo moto apportionment was upheld; AO's invocation of Rule 8D without recording dissatisfaction was unjustified.

Final Conclusion: The revenue's appeal is dismissed and the order of the CIT(A) restricting the Section 14A disallowance to the amount suo moto disallowed by the assessee is upheld.

Explanation 1 to Sec.37(1) - deduction excluded where expenditure is prohibited by law - Disallowance of freebies under MCI guidelines and CBDT circular - Revision under Section 263 - scope and limits - Application of mind by the Assessing Officer - Permissible view / two views rule - Binding effect of Tribunal decisions on assessment and revision

Revision under Section 263 - scope and limits - Application of mind by the Assessing Officer - Permissible view / two views rule - Binding effect of Tribunal decisions on assessment and revision - Whether the order passed by the Pr.CIT under Section 263 setting aside the assessment and directing fresh assessment was sustainable, and whether the consequential assessment framed under Sec.143(3) r.w.s. 263 could be sustained after the Section 263 order was quashed. - HELD THAT: - The Tribunal examined the record and the earlier Tribunal order quashing the Pr.CIT's revisionary order and found that the Assessing Officer had applied his mind while dealing with the expenditure items and had adopted a legally permissible view. Where two views are possible and the Assessing Officer adopts one view, that alone does not render the assessment order amenable to revision under Section 263. The Tribunal further held that prior Tribunal decisions in the assessee's own case and other similar decisions were binding or at least constituted a permissible view which the AO could adopt; the Pr.CIT's direction for further enquiry and revisional interference was therefore not sustainable. In consequence, once the revisionary order under Section 263 was quashed, the consequential assessment framed pursuant to that revision could not be sustained and was liable to be quashed as well. [Paras 7, 8, 17, 19]

The order under Section 263 was not sustainable; the consequential assessment framed under Sec.143(3) r.w.s. 263 was quashed and the CIT(A)'s vacation of that assessment was upheld.

Explanation 1 to Sec.37(1) - deduction excluded where expenditure is prohibited by law - Disallowance of freebies under MCI guidelines and CBDT circular - Whether the medical conference/sales-promotion expenditure booked as freebies and claimed as business deduction was hit by Explanation 1 to Sec.37(1) on account of prohibition under MCI regulations and CBDT circular so as to justify disallowance. - HELD THAT: - While the revenue contended that the expenditure was prohibited by MCI regulations and therefore not deductible under Explanation 1 to Sec.37(1), the Tribunal relied on the Assessing Officer's detailed examination of the expenditures and on binding or persuasive Tribunal precedents which had allowed similar medical conference expenses. The Tribunal recorded that the AO had disallowed certain sales-promotion items which he found to be freebies, but had examined and allowed the medical conference expenditure adopting a permissible view. The Tribunal rejected the Pr.CIT's conclusion that the AO had not applied his mind or examined records; mere dissatisfaction by the Pr.CIT and a direction for further enquiry did not warrant revision under Section 263 when a permissible view had been taken by the AO. [Paras 13, 15, 16, 17]

The contention that the medical conference expenses were automatically hit by Explanation 1 to Sec.37(1) was not accepted for purposes of revision; the AO's allowance of those expenditures represented a permissible view and could not be disturbed by the revisionary order.

Final Conclusion: The revenue appeals for A.Y. 2012-13 and A.Y. 2013-14 are dismissed: the Section 263 order was quashed as the Assessing Officer had applied his mind and adopted a permissible view (supported by Tribunal precedents), and the consequential assessments framed pursuant to the quashed revision could not be sustained.

Deduction under section 10A - allocation of profits between export and domestic turnover - allowability of business expenditure-foreign travel expenses - allowability of legal and professional expenses - transfer pricing-selection of tested party and capacity utilisation - application of alternative TP study under TNMM and benchmarking - principles of natural justice and opportunity to file reply (Rule 46A)

Deduction under section 10A - allocation of profits between export and domestic turnover - Whether profit from domestic sales can be separately taxed and excluded from deduction under section 10A when export and domestic sales are carried out by the same undertaking. - HELD THAT: - The Tribunal agreed with the CIT(A) that section 10A(4) prescribes a formula to determine profits attributable to export business where both export and domestic sales are undertaken by the same undertaking. The profit or loss of the undertaking must be computed as a whole and the proportionate profit attributable to exports is determined by the statutory formula; the Assessing Officer's approach of segregating domestic profit for separate taxation and denying deduction was contrary to the scheme of section 10A. The Tribunal found no infirmity in the CIT(A)'s application of the statutory formula and dismissed the Revenue's challenge. [Paras 8, 9, 13]

The CIT(A)'s allowance of deduction under section 10A on the basis that profits of the undertaking are to be computed as a whole is upheld; Revenue's ground is dismissed.

Allowability of business expenditure-foreign travel expenses - Whether foreign travel expenses disallowed by the Assessing Officer for lack of nexus or because claimed to be on behalf of others are deductible as business expenditure. - HELD THAT: - The Tribunal accepted the CIT(A)'s finding that the Assessing Officer did not dispute the genuineness of the expenditures and that the trips were undertaken by the assessee's employees (including senior management and operational heads) for business development, training and obtaining international standards necessary for an export-oriented call-centre undertaking. Given the nature of the business and that this was the first year of operations, the Tribunal held it was for the taxpayer to determine necessary business expenses and that the Assessing Officer's legitimacy inquiry could not justify disallowance. The disallowance was therefore deleted. [Paras 20, 22]

The CIT(A)'s deletion of the disallowance of foreign travel expenses is upheld; Revenue's ground is dismissed.

Allowability of legal and professional expenses - Whether disallowance of legal and professional expenses as lacking business nexus was justified. - HELD THAT: - The Tribunal agreed with the CIT(A)'s item by item examination of legal and professional payments and rejected the Assessing Officer's view that the assessee cannot decide which services are necessary for carrying on its business. The payments (for overseas market identification, deputation charges, UK establishment, value chain analysis, etc.) were held to be normal business expenditures incurred for development of the assessee's service business and hence allowable. The Tribunal found no error in the CIT(A)'s deletion of the addition. [Paras 26, 28]

The CIT(A)'s deletion of the addition of legal and professional expenses is upheld; Revenue's ground is dismissed.

Transfer pricing-selection of tested party and capacity utilisation - application of alternative TP study under TNMM and benchmarking - Whether the TPO's adjustment (which selected the assessee as tested party and made an ALP adjustment) was sustainable, or whether the CIT(A)'s acceptance of the assessee's alternative TP study based on under utilisation of capacity and other comparability factors should be upheld. - HELD THAT: - The Tribunal reviewed the alternative TP submissions allowed by the CIT(A). It noted that the assessee, being in its first year and operating at substantially less than optimal capacity (utilisation ~52.65% with unutilised capacity ~47.35%), incurred start up and fixed costs affecting margins. The Tribunal found the assessee's alternative study met transfer pricing requirements and that the CUP/TNMM benchmarking adopted by the CIT(A) (considering capacity under utilisation and internal comparables) justified no further adjustment. Given the assessee's OP/TC under the accepted approach compared favourably with the comparables, the Tribunal found no infirmity in the CIT(A)'s conclusion and declined to interfere with the deletion of the TPO adjustment. [Paras 39, 41, 42]

The CIT(A)'s acceptance of the assessee's alternative TP study and rejection of the TPO's adjustment is upheld; Revenue's ground is dismissed.

Principles of natural justice and opportunity to file reply (Rule 46A) - Whether the CIT(A) violated Rule 46A or principles of natural justice by not giving opportunity to the Assessing Officer/TPO. - HELD THAT: - The Tribunal observed that the CIT(A) forwarded the assessee's replies to the Assessing Officer and provided opportunities for response, but no substantive reply was received from the Assessing Officer despite sufficient time being afforded. On the record, the Tribunal did not find any breach of natural justice in the CIT(A)'s conduct of proceedings and proceeded to adjudicate the matters on the merits. [Paras 33]

No violation of Rule 46A or principles of natural justice is found; the Revenue's grievance is dismissed.

Final Conclusion: The appeals filed by the Revenue for A.Y. 2004-05 and A.Y. 2005-06 are dismissed. The Tribunal upheld the CIT(A)'s allowance of deduction under section 10A (computed as a whole for the undertaking), sustained deletion of disallowances for foreign travel and legal/professional expenses, and affirmed the CIT(A)'s acceptance of the assessee's alternative transfer pricing study based on capacity under utilisation; no procedural infirmity under Rule 46A or natural justice was found.

Entitlement under Target Plus Scheme for incremental export growth - no dues certificate requirement under Trade Notice No.06 of 2018 - interpretation of "government dues" as payable and subsisting - retrospectivity of amendment to a trade incentive scheme - conditional approval by Zonal Committee subject to customs clearance

Entitlement under Target Plus Scheme for incremental export growth - retrospectivity of amendment to a trade incentive scheme - Petitioner entitled to the balance duty credit scrips (remaining 10%) for exports in 2005-2006 and Respondents directed to issue licence for the balance amount. - HELD THAT: - Petitioner exported in 2005-2006 showing incremental growth exceeding 100% and thus fell in the 15% entitlement slab under the Target Plus Scheme. An amendment (Notification No.08 of 2006) had earlier curtailed entitlement to 5% with retrospective effect, but the Supreme Court held that amendment could not be applied retrospectively. Respondent later made the amendment prospective and set up procedures for claims, following which the Petitioner obtained partial benefit (5%) by licence dated 14.02.2007 and renewed claim for the remaining benefit. The Court found that once a part of the benefit for the same year was granted, there was no valid basis to withhold the remaining entitlement which had become due; prolonged inaction over many years defeated the scheme's object to incentivise exports. Accordingly, Respondents were directed to issue the necessary licence for the balance duty credit scrips for 2005-2006 within four weeks. [Paras 6, 9, 20, 29, 31]

Writ petition allowed; Respondents directed to issue licence for the balance/additional duty credit scrips for 2005-2006 within four weeks.

No dues certificate requirement under Trade Notice No.06 of 2018 - interpretation of "government dues" as payable and subsisting - conditional approval by Zonal Committee subject to customs clearance - Alleged non-submission of BRCs reported by customs does not, without quantification or a demand, constitute "government dues" justifying withholding of the balance entitlement. - HELD THAT: - Trade Notice No.06 of 2018 requires a certificate that no dues to government/departments are pending, and the Supreme Court has clarified that this refers only to dues which are payable and still subsisting. The Zonal Committee minutes noted submission of the prescribed no dues certificate and recorded customs' report of dues related to non-submission of Bank Realization Certificates (BRCs) for drawback claims, leading to conditional approval subject to customs clearance. The Court held that an alleged non-submission of BRCs-a bank document evidencing realisation-cannot, without more, be equated to a quantified demand or subsisting government liability. The minutes did not record any demand, notice, or quantification of government dues. Therefore, the customs observation did not justify withholding the already admitted balance entitlement. [Paras 23, 25, 26, 27, 28]

Customs' report of non-submission of BRCs does not amount to a recoverable government due absent quantification or a demand; conditionality based on such report did not justify withholding the balance scrips.

Final Conclusion: Petition allowed; Respondents to issue the licence for the balance duty credit scrips for 2005-2006 (remaining entitlement) within four weeks, the customs observation regarding BRCs not constituting a subsisting government due sufficient to withhold the benefit.

Companies Act, 2013 as a complete code for investigation into affairs of a company - Exclusivity of Serious Fraud Investigation Office for certain company investigations and procedure under Section 212 - Limited prohibition on grant of bail in respect of offences triable under the Companies Act - Application of Code of Criminal Procedure to proceedings before Special Court - Article 21 and the Dataram Singh principles governing grant of bail - Procedural infirmity in criminal investigation where specific statutory machinery exists

Companies Act, 2013 as a complete code for investigation into affairs of a company - Exclusivity of Serious Fraud Investigation Office for certain company investigations and procedure under Section 212 - Procedural infirmity in criminal investigation where specific statutory machinery exists - Limited prohibition on grant of bail in respect of offences triable under the Companies Act - Article 21 and the Dataram Singh principles governing grant of bail - Whether the applicant should be released on bail in Case Crime No. 1590 of 2019 in view of the nature of allegations relating to company affairs, the statutory scheme under the Companies Act, 2013 and the manner in which the investigation was conducted - HELD THAT: - The court found that the allegations arise from mismanagement and alleged fraud in the affairs of a private limited company and that the Companies Act, 2013 contains a comprehensive code for investigation, arrest and prosecution in such matters, including the role of the Serious Fraud Investigation Office and the special procedure and limitations for bail in offences under that Act. The investigation in the present matter, however, was conducted by the police rather than under the machinery envisaged by the Companies Act (including any authorisation by the Central Government or SFIO), pointing to procedural infirmity. While Section 212(6) of the Companies Act restricts grant of bail for offences under Section 447, that limitation is subject to specified exceptions (including where the accused is a woman) and does not wholly exclude application of Cr.P.C. In the facts of this case the applicant is a woman, there are procedural flaws in the investigation, the offences are alleged to be triable by a Magistrate, and the court must balance the liberty interest under Article 21. Having regard to these factors and the principles laid down by the Apex Court in Dataram Singh, the court concluded that, without expressing any opinion on merits, the applicant had made out a case for bail. [Paras 5, 7, 8, 9]

Bail granted to the applicant in Case Crime No. 1590 of 2019 on furnishing personal bond and two sureties, subject to enumerated conditions including non-tampering with evidence, cooperation in trial, presence at specified stages and travel restrictions; liberty to impose short-term bail modalities as stated.

Final Conclusion: The bail application is allowed: having regard to the statutory scheme under the Companies Act, procedural flaws in the police investigation, the applicant's status as a woman, the nature of the offences and Article 21 jurisprudence (including Dataram Singh), the High Court directed release on bail subject to specified conditions.

Change of name versus change in constitution of a company - transfer fee on alleged change of shareholding - non-utilisation penalty and operation of environmental moratorium - construction moratorium as a force majeure for non-utilisation - application of Companies Act provisions on change of name

Change of name versus change in constitution of a company - transfer fee on alleged change of shareholding - application of Companies Act provisions on change of name - Addition of the word 'Private' and rearrangement of shareholding within the family did not constitute a change in the constitution of the company attracting transfer fees. - HELD THAT: - The Court examined the factual material showing that the alteration was limited to addition of the word 'Private' to the company name and internal reallocation of shares among family members without creation of a new legal entity. Applying the Companies Act provisions governing change of name, the Court observed that addition of 'private' consequent to conversion of class does not require Central Government approval and does not alter the company's constitutional identity. The Corporation's contention that any variation in percentage holdings removes the case from the 'change of name' category was rejected because the transaction was a family rearrangement and not a substantive change in constitution. Accordingly the levy of transfer fee on that basis was held to be without lawful foundation. [Paras 5]

Demand of transfer fee was illegal and cannot be levied in respect of the name change and intra-family share rearrangement.

Non-utilisation penalty and operation of environmental moratorium - construction moratorium as a force majeure for non-utilisation - Recovery of non-utilisation penalty was not permissible for the period during which a statutory moratorium prevented obtaining environmental clearance and commencement of construction. - HELD THAT: - The Court took note of the Ministry of Environment and Forests' notification imposing a moratorium from 25.08.2009 and the memorandum lifting it only on 25.11.2016. During this period no environmental clearances or construction permissions could lawfully be obtained; therefore non-utilisation of the industrial plots was due to circumstances beyond the petitioner's control. The Court concluded that levying and recovering non-utilisation penalty for that period lacked legal authority. Where the petitioner had already paid such charges in one petition, the Corporation was directed to refund the amounts paid. [Paras 6]

Demand and recovery of non-utilisation penalty for the moratorium period were illegal; amounts paid shall be refunded where already recovered.

Final Conclusion: Writ petitions allowed. The Corporation's demands for transfer fee and non-utilisation penalty were held illegal; transfer fee demand set aside and non-utilisation charges recovered earlier shall be refunded. No costs.

Scheme of Amalgamation - Sanction under Sections 230 and 232 of the Companies Act, 2013 - Compliance with statutory notice, publication and service requirements - No-objection reports from Regional Director, Official Liquidator and Income Tax Department - Accounting treatment conformity with notified Accounting Standards - Transfer of assets, rights, liabilities and pending proceedings to transferee company - Dissolution of transferor companies without winding up - Continuity of employment on transfer - Registrar compliance and filing to give effect to scheme - Sanction not to impede subsequent action for statutory violations

Compliance with statutory notice, publication and service requirements - No-objection reports from Regional Director, Official Liquidator and Income Tax Department - Petitioners complied with the Tribunal's directions regarding meetings, newspaper publication and service, and no specific objections were raised by the Regional Director, Official Liquidator or Income Tax Department. - HELD THAT: - The Tribunal recorded that the First Motion dispensed with meetings where not required and that the Second Motion directions for publication and service were complied with as evidenced by an affidavit dated 03.03.2020 and acknowledgements filed on record. The Regional Director's representation, the Official Liquidator's report and the Income Tax Department's report did not raise specific objections; the Official Liquidator and Income Tax Department affirmed absence of complaints, prosecutions, inspections, outstanding demands or pending proceedings against the petitioner companies. Having considered these compliance affidavits and reports, the Tribunal found no impediment arising from procedural or regulatory objections to sanctioning the scheme. [Paras 4, 5, 6, 7, 8]

Compliance with Tribunal directions and absence of statutory objections established, permitting consideration and sanction of the scheme.

Sanction under Sections 230 and 232 of the Companies Act, 2013 - Scheme of Amalgamation - The Scheme of Amalgamation was sanctioned by the Tribunal under Sections 230 and 232 of the Companies Act, 2013. - HELD THAT: - After noting approval by members and creditors where applicable, the absence of objections from the Regional Director, Official Liquidator and Income Tax Department, and the affidavit of undertaking filed by the transferee company, the Tribunal concluded there was no impediment to sanctioning the scheme. The Tribunal accordingly granted sanction to the scheme under Sections 230 and 232 and recorded that the petitioners remain bound to comply with statutory requirements. [Paras 10, 11]

Scheme sanctioned under Sections 230 and 232 of the Companies Act, 2013.

Transfer of assets, rights, liabilities and pending proceedings to transferee company - Dissolution of transferor companies without winding up - Upon the scheme taking effect, all properties, rights, liabilities and pending proceedings of the transferor companies shall stand transferred to the transferee company and the transferor companies shall be dissolved without winding up. - HELD THAT: - The Tribunal ordered that, pursuant to Section 232, all properties, rights and powers of the transferor companies shall stand transferred to and vest in the transferee company without further act or deed; all liabilities and duties shall transfer and become those of the transferee company; and all proceedings pending by or against the transferor companies shall continue by or against the transferee company. The Tribunal also directed that the transferor companies shall stand dissolved without following the winding up process. [Paras 14]

Assets, rights, liabilities and proceedings to vest in transferee company; transferor companies to be dissolved without winding up.

Continuity of employment on transfer - Employees of the transferor companies in service immediately prior to the effective date shall become employees of the transferee company on terms not less favourable than existing terms and without interruption. - HELD THAT: - The Tribunal directed that all employees in service on the date immediately preceding the effective date of the scheme shall become employees of the transferee company without any break or interruption in service and on terms and conditions not less favourable than those subsisting in the respective transferor companies on that date. [Paras 14]

Employee continuity assured; service preserved on not less favourable terms and without interruption.

Registrar compliance and filing to give effect to scheme - Sanction not to impede subsequent action for statutory violations - Petitioners must file a certified copy of the order with the Registrar of Companies for registration; sanction does not prevent subsequent lawful action for any statutory deficiency or violation, nor grants exemption from stamp duty, taxes or other charges. - HELD THAT: - The Tribunal directed that petitioners shall, within thirty days of receipt of the order, deliver a certified copy to the Registrar of Companies for registration, after which the transferor companies shall stand dissolved and records consolidated. The Tribunal further clarified that if any deficiency or violation of any enactment, rule or regulation is found, the sanction will not bar action being taken in accordance with law against concerned persons, and that the order does not operate as an exemption from payment of stamp duty, taxes, GST or other charges or from any permissions/compliances required under any law. [Paras 11, 12, 13, 14]

Registrar filing directed to give effect to scheme; sanction subject to lawful action for any subsequent statutory violations and not a waiver of taxes or duties.

Final Conclusion: The Tribunal, after recording compliance with its directions, noting no substantive objections from statutory authorities and receipt of auditor certificates as to accounting treatment, sanctioned the Scheme of Amalgamation under Sections 230 and 232 of the Companies Act, 2013 and issued consequential directions for transfer of assets, liabilities, employee continuity, Registrar filing and dissolution, while preserving the right to take action for any statutory violations and without granting exemptions from taxes or duties.

Restoration of name struck off - company in operation - discretion under Section 252(1) of the Companies Act, 2013 - compliance of outstanding statutory filings and payment of late fees - condition precedent of payment to Prime Minister's Relief Fund for restoration

Company in operation - restoration of name struck off - The company demonstrated it was in operation prior to striking off and that restoration of its name from the register is justified. - HELD THAT: - The Tribunal accepted the appellant's documentary evidence - audited financial statements for FY 2014-15 to 2016-17, bank statements for 2014-2018, income-tax returns for relevant assessment years and the reply to the ROC's STK-5 notice - as sufficient to show the company was not defunct and had been in operation before the name was struck off. Applying the discretionary power vested in the Adjudicating Authority by Section 252(1) of the Companies Act, 2013, the Tribunal concluded that it was 'just' to restore the company's name to the Register of Companies. The Tribunal therefore set aside the ROC's public notice striking off the company's name and ordered restoration on that basis. [Paras 11]

Appeal allowed; restoration ordered on finding that the company had been in operation and restoration was just.

Discretion under Section 252(1) of the Companies Act, 2013 - compliance of outstanding statutory filings and payment of late fees - condition precedent of payment to Prime Minister's Relief Fund for restoration - Restoration granted subject to specified conditions of compliance, filing and payments. - HELD THAT: - While allowing restoration, the Tribunal imposed conditions: the appellant must file all outstanding statutory documents with the Registrar of Companies up to date, pay the requisite late filing fees and any other charges leviable for delayed filing, and pay the specified amount to the Prime Minister's Relief Fund. The ROC had indicated no objection to restoration provided statutory filings and fees were completed; the Tribunal incorporated that requirement and added the payment to the Prime Minister's Relief Fund as a condition precedent to restoration, directing that upon compliance the company's name shall stand restored as if it had not been struck off under Section 248(1). [Paras 12]

Restoration ordered conditional on filing outstanding documents, payment of late fees and charges, and payment to the Prime Minister's Relief Fund.

Final Conclusion: The appeal is allowed: the public notice striking off the company's name is set aside and the company's name is ordered to be restored to the Register of Companies, subject to filing all outstanding statutory returns, payment of requisite late fees and other charges, and payment to the Prime Minister's Relief Fund, after which the name shall stand restored as if not struck off.

Transfer of writ petitions to the Supreme Court under Article 139A read with Article 142 of the Constitution - avoidance of conflicting High Court decisions and need for authoritative settlement of law - interpretation of provisions of the Insolvency and Bankruptcy Code relating to personal guarantors to corporate debtors - bar on entertaining further writ petitions challenging the same notification by High Courts - continuance of interim orders until further orders

Transfer of writ petitions to the Supreme Court under Article 139A read with Article 142 of the Constitution - avoidance of conflicting High Court decisions and need for authoritative settlement of law - interpretation of provisions of the Insolvency and Bankruptcy Code relating to personal guarantors to corporate debtors - Transfer of writ petitions pending in various High Courts challenging the Notification dated 15.11.2019 and related issues to the Supreme Court. - HELD THAT: - The Court examined the pendency of multiple writ petitions in different High Courts challenging the Notification bringing into force specified provisions of the Insolvency and Bankruptcy Code insofar as they relate to personal guarantors to corporate debtors. Having regard to the nascent stage of the Code and the risk of divergent decisions by High Courts, the Court concluded that transfer to this Court is warranted to authoritatively settle the interpretation of the Code and to avoid confusion. The Court accepted the petitioner's contention that centralised adjudication would secure early and final determination of important legal questions arising from the Notification and the Rules made thereunder, and that transfer would prevent conflicting adjudications across jurisdictions. [Paras 6, 7]

Writ petitions pending in various High Courts challenging the Notification dated 15.11.2019 and related issues are transferred to this Court.

Bar on entertaining further writ petitions challenging the same notification by High Courts - continuance of interim orders until further orders - Whether High Courts should be restrained from entertaining further writ petitions challenging the Notification dated 15.11.2019, and the status of interim orders previously granted by High Courts. - HELD THAT: - In consequence of the transfer, the Court directed that no further writ petitions challenging the Notification bringing Part III and other provisions into force in respect of personal guarantors shall be entertained by any High Court. This restriction was imposed to prevent multiplicity of proceedings and ensure that the issues are decided in a single forum. However, the Court preserved the status of any interim orders passed by High Courts in existing matters, directing that such interim orders shall continue to operate until further orders of this Court, thereby protecting parties' interim rights pending final adjudication here. [Paras 8]

High Courts shall not entertain further writ petitions challenging the Notification dated 15.11.2019; interim orders already passed by High Courts shall continue until further orders.

Final Conclusion: The Transfer Petitions are allowed: the writ petitions challenging the Notification dated 15.11.2019 and related issues are transferred to the Supreme Court; High Courts are directed not to entertain further writ petitions on the same challenge, while existing interim orders granted by the High Courts shall continue until further orders.

Regulatory fee versus tax - excessive delegation / unguided and uncanalised power - constitutional validity of Section 386(2) of the GPMC Act - Article 243X - power to authorise municipalities to levy taxes, tolls and fees - Article 243ZF - continuance of pre 74th Amendment laws - presumption in favour of constitutionality - checks and balances: sanction of the Corporation and State control under Section 451 - writ jurisdiction under Articles 226 and 227

Constitutional validity of Section 386(2) of the GPMC Act - Article 243X - power to authorise municipalities to levy taxes, tolls and fees - presumption in favour of constitutionality - Section 386(2) of the GPMC Act is not ultra vires Article 243X of the Constitution of India. - HELD THAT: - The Court applied the settled rule that statutes attract a presumption of constitutionality and, where a construction keeping the provision operative is reasonably available, that construction should be preferred. Section 386(2) must be read with Section 386(1) and the broader scheme of the GPMC Act (including provisions relating to municipal authorities, funds, taxation, licensing and State control). The provision permits the Commissioner to fix rates only with the sanction of the Corporation; this requirement constitutes an in built procedural check. Further, the Act contains other chapters and provisions (and State control under Section 451) which operate as guidelines and supervisory controls. On that basis and having regard to analogous authority holding that enabling Articles (such as Article 243X) are not a mandate to strike down pre existing laws absent clear inconsistency, the Court held that Section 386(2) cannot be struck down under Article 243X.

Section 386(2) is constitutionally valid and not ultra vires Article 243X.

Regulatory fee versus tax - Article 243ZF - continuance of pre 74th Amendment laws - Deletion of erstwhile Entry 55 of List II and the introduction of the GST regime do not render Section 386(2) inapplicable to licensing fees for hoardings; the impugned levy is properly characterised as a fee and remains constitutionally supported by Entry 5 read with Entry 66 of List II. - HELD THAT: - Entry 55 (which previously addressed taxes on advertisements) dealt with taxation, not fees. The Court distinguished levy of a municipal license fee from a State tax and held that Entry 5 (local government) read with Entry 66 (fees in respect of matters in the List) provides constitutional coverage for levy of fees by municipal legislation. Article 243ZF (continuance of pre existing laws) does not assist the petitioners because Section 386(2) is not inconsistent with Part IXA; deletion of Entry 55 and the GST architecture does not automatically extinguish municipal powers to levy regulatory or compensatory fees where constitutionally supported.

Deletion of Entry 55/GST does not invalidate Section 386(2); the licence fee remains payable as a fee under Entry 5 read with Entry 66.

Excessive delegation / unguided and uncanalised power - checks and balances: sanction of the Corporation and State control under Section 451 - Section 386(2) does not amount to excessive delegation; it contains sufficient checks and procedural safeguards. - HELD THAT: - The Court rejected the contention that Section 386(2) vests unguided power in the Commissioner. The subsection operates subject to the sanction of the Corporation; the Commissioner's proposals become effective only upon approval by Standing Committee and the Corporation. The Act contains a scheme (including Chapters on municipal fund, taxation, licensing and State supervisory powers such as Section 451) which supplies legislative policy and guidance. Authorities cited concerning excessive delegation of taxing powers were held distinguishable because those decisions addressed different factual and statutory matrices involving taxation rather than fees.

Section 386(2) is not vitiated by excessive delegation; its procedural checks and broader statutory scheme adequately canalise discretion.

Regulatory fee versus tax - presumption in favour of constitutionality - The licence fee for advertisement hoardings in private properties is a fee (regulatory/compensatory in character) and not a tax; it is not subsumed by GST so as to render municipal levy unlawful. - HELD THAT: - After surveying the authorities distinguishing taxes and fees, the Court held that the licence in issue confers a privilege and is levied in the context of municipal regulatory functions; prior decisions of this Court in the same field treating the levy as a regulatory fee (including the earlier 2006 decision in SCA No.12603) remain good law and are not per incuriam. The Court observed that the classic tests from the 1954 Constitution Bench remain relevant but must be applied pragmatically; where a broad and reasonable correlation exists between the levy and municipal regulatory/administrative functions, the imposition will bear the character of a fee rather than a tax.

The impugned licence fee is a fee (regulatory/compensatory) and not a tax; it is not rendered unlawful by GST or deletion of Entry 55.

Writ jurisdiction under Articles 226 and 227 - fixation of fee - allegation of arbitrariness and excess - The Court declined to interfere with the quantum of the licence fees fixed by the Corporation under writ jurisdiction and directed that challenges to the quantum be pursued before the State Government under the statutory scheme. - HELD THAT: - The Court emphasised limits of writ review in fiscal matters and the need to respect municipal discretion where exercised within statutory bounds. It refrained from adjudicating rival factual and arithmetic claims about the reasonableness or excessiveness of the new rates. Instead the Court left the question of quantum to the remedy provided by the GPMC Act and directed the State Government to consider any representation/challenge by the petitioners expeditiously and on merits, unaffected by the Court's constitutional conclusions.

No interference with the fixation of quantum under writ jurisdiction; petitioners may challenge the amount before the State Government and that challenge shall be considered expeditiously.

Final Conclusion: The petitions are dismissed on the merits: Section 386(2) of the GPMC Act is constitutionally valid, does not suffer from excessive delegation, and authorises levy of licence fees for advertisement hoardings (which are regulatory/compensatory fees and not taxes); deletion of Entry 55/GST does not invalidate the municipal levy. The Court declined to adjudicate on the excessiveness of the revised rates and directed the petitioners to pursue challenges to the quantum before the State Government, which shall decide them expeditiously. Rule discharged; no order as to costs.

Treatment of agreements as awards under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 - binding effect of unilateral agreements accepted by the Collector - reference to authority under Section 64 of the Act, 2013 - determination of market value and compensation under Sections 26 to 30 of the Act, 2013 - award of solatium and additional land value - exemption from income tax under Section 96 of the Act, 2013

Treatment of agreements as awards under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 - binding effect of unilateral agreements accepted by the Collector - determination of market value and compensation under Sections 26 to 30 of the Act, 2013 - Extent to which the unilateral agreements (Exts.P10 and P11) executed by the landowners in favour of the District Collector can be treated as awards for purposes of re-determination of compensation under the Act, 2013. - HELD THAT: - The Court found that the agreements incorporate an express condition preserving the landowners' entitlement to any further compensation or package offered under the Act, 2013, and that the determination of compensation reflected the regime and parameters of the Act (including provisions on market value, solatium and additional land value). Having acted upon and accepted those agreements (possession taken and compensation paid in terms thereof), the Collector could not repudiate the essential term that allowed the landowners to seek re-determination under the Act. The condition in the agreements is not alien to the Act but coheres with its object of ensuring fair and adequate compensation and rehabilitation. Consequently, the agreements are to be regarded for the purpose of enabling landowners to seek enhancement under the Act. [Paras 10, 15]

Exts.P10 and P11, being agreements accepted and acted upon by the Collector and containing terms preserving the landowners' right to claims under the Act, must be treated so as to enable re-determination under the Act, 2013.

Reference to authority under Section 64 of the Act, 2013 - determination of market value and compensation under Sections 26 to 30 of the Act, 2013 - Whether the District Collector is obliged to consider the landowners' applications (Exts.P12 and P13) seeking reference to the Authority under Section 64 of the Act, 2013. - HELD THAT: - Section 64 permits any person interested who has not accepted the award to seek that the matter be referred to the Authority for determination on measurement, amount of compensation, apportionment, and related matters. The Court emphasised that re-determination under the Act can only be undertaken by the Authority constituted under the Act and not by the Collector acting unilaterally. Given the agreements and the applications filed by the landowners seeking reference, the Collector was directed to refer and take appropriate steps under Section 64 so that the Authority may consider re-determination in accordance with the Act. [Paras 11, 12]

The Collector must consider Exts.P12 and P13 and, where appropriate, refer the matters to the competent Authority under Section 64 of the Act, 2013 for re-determination.

Exemption from income tax under Section 96 of the Act, 2013 - Whether a prior judgment holding that tax was not deducted under Section 194LA precludes the landowners from claiming re-determination or enhanced compensation under the Act, 2013. - HELD THAT: - The appellants relied on an earlier single Judge's decision concerning deduction of tax at source to argue that the landowners admitted the transaction and therefore cannot claim under the Act. The Court observed that Section 96 of the Act expressly provides exemption from income tax and stamp duty in respect of any award or agreement made under the Act, save as provided, and that no income tax can be levied on such award or agreement. Consequently, the appellants could not derive advantage from the earlier judgment to deny the landowners' claims under the Act. [Paras 13]

The contention based on the Annexure A3 judgment and non-deduction of income tax does not bar the landowners from seeking re-determination under the Act, having regard to the exemption under Section 96.

Final Conclusion: The High Court's judgment was upheld: the unilateral agreements (Exts.P10 and P11) accepted and acted upon by the Collector are to be treated such that the landowners may seek re-determination under the Act, 2013; the Collector must consider Exts.P12 and P13 and refer the matters to the competent Authority under Section 64; and the appellants' reliance on an earlier judgment concerning tax deduction does not preclude claims under the Act. The writ appeal is dismissed.

Presumption under Section 139 of the Negotiable Instruments Act - burden on accused to rebut presumption by acceptable evidence - conviction under Section 138 of the Negotiable Instruments Act - service of statutory notice and deemed admission - failure to produce material witness and effect of suppression of evidence

Presumption under Section 139 of the Negotiable Instruments Act - burden on accused to rebut presumption by acceptable evidence - conviction under Section 138 of the Negotiable Instruments Act - service of statutory notice and deemed admission - failure to produce material witness and effect of suppression of evidence - Whether the conviction and sentence under Section 138 of the Negotiable Instruments Act could be sustained where the cheque and signature were admitted but the accused asserted an alternative transaction and did not produce material evidence - HELD THAT: - The Court held that admission of issuance of the cheque and the accused's signature gives rise to the statutory presumption under Section 139 of the Negotiable Instruments Act, shifting the burden to the accused to rebut that presumption by acceptable evidence. The accused admitted service of the statutory notice and did not at that stage deny liability, a circumstance treated as adverse to him. The defence that the cheque related to a third-party tractor transaction required production or explanation of the material witness (Ningegowda), but the accused chose not to examine that witness and offered no satisfactory explanation for suppressing him. The evidence of defence witnesses was found to be of no avail and the complainant's lending capacity was not controverted. In these circumstances the Trial Court rightly concluded that the presumption stood unrebutted and convicted the accused; the First Appellate Court rightly affirmed that conclusion. The Court relied on the established principle in Rangappa v/s Mohan and the later reiteration in APS Forex Services Pvt. Ltd. vs. Shakti International Fashion Linkers and Others that once the Section 139 presumption arises the onus lies on the accused to rebut it by acceptable evidence. [Paras 16, 17, 20, 21, 22]

Conviction and sentence under Section 138 upheld; revision petition dismissed

Final Conclusion: The High Court dismissed the revision petition, upholding the Trial Court and First Appellate Court's finding that the statutory presumption under Section 139 arose and was not rebutted by acceptable evidence, and accordingly affirmed the conviction and sentence under Section 138 of the Negotiable Instruments Act.