TaxTMI Updates e-Newsletter
Dec 21,2022

Cancellation of registration - non-speaking order - requirement to apply mind - opportunity of hearing - remand for fresh consideration - principle of reasoned orders under Article 14 - availability of alternate statutory remedy

Cancellation of registration - non-speaking order - requirement to apply mind - principle of reasoned orders under Article 14 - Validity of the order dated 03.01.2022 cancelling the petitioner's GST registration. - HELD THAT: - The Court found that the cancellation order set out no reasons beyond recording non-response to the show cause notice and therefore was a non speaking order. Even where a registrant does not reply, the adjudicating authority is obliged to examine the material and apply its mind before arriving at the conclusion that cancellation is warranted. An order cancelling registration must reflect such application of mind and reasons; absence of any such reasoning renders the order illegal and vulnerable to judicial review, having regard to the requirement of reasoned orders under Article 14. Applying these principles, the Court set aside the impugned cancellation order and remitted the matter for fresh consideration. [Paras 9, 10]

Impugned order of cancellation dated 03.01.2022 set aside and matter remitted for fresh consideration with directions.

Opportunity of hearing - remand for fresh consideration - availability of alternate statutory remedy - Procedure to be followed on remand and interim procedural directions. - HELD THAT: - The Court observed that the petitioner may have an alternate statutory remedy before the GST Tribunal but, since the Tribunal in the State was not constituted for effective relief, the writ petition was entertained. The petitioner was permitted to file his reply to the show cause notice within three weeks from the date of the order and to furnish a certified copy of this order; upon receipt, the authority is directed to consider the reply and pass a fresh order in accordance with law. The remand is for fresh adjudication on merits after affording opportunity to the petitioner, not merely for mechanical reconsideration. [Paras 6, 10]

Petitioner permitted to file reply within three weeks; authority directed to pass fresh order after considering the reply and this order.

Final Conclusion: Writ petition allowed: the cancellation order is set aside as non speaking and the matter is remitted for fresh consideration after the petitioner is afforded an opportunity to file a reply within three weeks, following which the authority shall pass a reasoned order in accordance with law.

Opportunity of personal hearing - principles of natural justice - Section 75(4) of the Act, 2017 - assessment under Section 74 - remand for fresh consideration

Opportunity of personal hearing - Section 75(4) of the Act, 2017 - principles of natural justice - Whether the assessment order was vitiated for want of affording personal hearing as required by law and principles of natural justice. - HELD THAT: - The Court found that the notice dated 17.12.2021, though referring to a prior notice and inviting appearance "for personal hearing... if mentioned in table below", recorded 'NA' against date, time and venue and therefore did not afford any intelligible opportunity of hearing. The petitioner had also filed a reply on 23.12.2021 in Form GST DRC-06 expressly opting for personal hearing which was not complied with. Section 75(4) of the Act, 2017 mandates that opportunity of hearing be afforded where a request is received or where an adverse decision is contemplated; accordingly the statutory scheme incorporates the element of natural justice and requires the authority to intimate date, time and venue before passing any adverse order. The Court treated the decision in Bharat Mint And Allied Chemicals Vs. Commissioner Commercial Tax and 2 others as persuasive on the proposition that denial of personal hearing amounts to a gross violation of natural justice that justifies interference under Article 226 notwithstanding availability of an alternative remedy. Applying that principle, the impugned assessment passed under Section 74 for the assessment year 2017-18 without affording the petitioner the personal hearing sought was held illegal and liable to be set aside.

The assessment order is illegal for contravention of Section 75(4) and principles of natural justice and is set aside.

Remand for fresh consideration - assessment under Section 74 - Whether the matter should be remitted for fresh decision after affording opportunity of hearing. - HELD THAT: - In view of the defect of procedure and the statutory requirement to afford hearing, the Court did not decide the assessment on merits but remitted the matter to the assessing authority to pass a fresh order strictly in accordance with law after intimating date, time and venue and affording personal hearing to the petitioner. The petitioner was directed to cooperate and attend the hearing; the remand is for fresh consideration and compliance with the statutory mandate before any fresh assessment is finalized.

Matter remitted to the respondent for fresh adjudication after affording personal hearing.

Final Conclusion: The writ petition is allowed: the assessment order dated 06.09.2022 as rectified on 13.09.2022 for assessment year 2017-18 is set aside for failure to afford personal hearing as required by Section 75(4) and principles of natural justice, and the matter is remitted for fresh decision after giving the petitioner an opportunity of hearing.

Violation of principles of natural justice - cryptic show cause notice and non-speaking order - requirement of reasoned/speaking orders - quashing of show cause notice and consequential order - liberty to issue fresh notice with particulars and opportunity of hearing - restoration of GST registration pending fresh decision

Violation of principles of natural justice - cryptic show cause notice and non-speaking order - requirement of reasoned/speaking orders - The impugned show cause notice and the consequential order were in breach of the principles of natural justice because they were cryptic and devoid of reasons. - HELD THAT: - The Court applied its earlier decision in Aggarwal Dyeing and Printing Works (reproduced and relied upon) and observed that reasons are integral to fairness and to the decision-making process; absence of cogent reasons or a speaking order denies a person reasonable opportunity to meet the case against him and frustrates the purpose of a show cause notice. The present notice consisting of one-line allegation and the terse order were held to be insufficient to inform the petitioner of the case to be met, thereby amounting to denial of natural justice and rendering the orders unsustainable. The Court noted that the notices and orders were auto-generated and cryptic, and that such practice frustrates meaningful hearing and transparency demanded by the speaking order doctrine. [Paras 5, 6]

The show cause notice and the impugned order are quashed and set aside on the ground of violation of principles of natural justice.

Quashing of show cause notice and consequential order - liberty to issue fresh notice with particulars and opportunity of hearing - restoration of GST registration pending fresh decision - Remedial directions: restoration of registration and liberty to the authority to issue a fresh reasoned notice and to pass a speaking order after affording opportunity of hearing. - HELD THAT: - Following quashing of the impugned instruments, the Court granted liberty to the respondent authority to issue a fresh show cause notice incorporating detailed reasons and particulars, to afford the petitioner reasonable opportunity to file objections and produce documents, and thereafter to pass an appropriate speaking order on merits. The Court directed that the fresh proceedings be conducted in accordance with the directions in Aggarwal Dyeing and Printing Works and observed that the GST registration of the petitioner stands restored forthwith until such fresh adjudication. The Court did not decide the merits of the underlying cancellation on substantive grounds but limited its order to setting aside the defective notice and order and directing fresh, reasoned proceedings. [Paras 8]

Registration restored immediately; respondent may issue fresh detailed notice, afford hearing and pass a speaking order on merits.

Final Conclusion: The petition is allowed solely for breach of natural justice: the cryptic show cause notice and the consequent order are quashed and set aside; the petitioner's GST registration is restored and the respondent is granted liberty to initiate fresh proceedings by issuing a reasoned show cause notice, affording a hearing and then passing a speaking order in accordance with the Court's directions.

Principles of natural justice - speaking order doctrine - reasons are heart and soul of the order - cancellation of GST registration - show cause notice with particulars of reasons and opportunity of hearing - quashing for absence of reasons - cancellation under Section 30 of the CGST Act

Principles of natural justice - speaking order doctrine - reasons are heart and soul of the order - quashing for absence of reasons - Validity of the cancellation of the petitioner's GST registration and the appellate order in view of the absence of reasons and denial of a meaningful opportunity of hearing. - HELD THAT: - The Court held that the cancellation order (and the impugned show cause notice procedure) was cryptic and lacked the requisite reasons that give effect to the principle that reasons are the heart and soul of an order. Citing established authority and earlier decision of this Court, the High Court emphasised that recording cogent, clear and succinct reasons is an indispensable component of fairness and natural justice; absence of such reasons results in denial of a reasonable opportunity and renders the order unsustainable. The order of cancellation merely stated that GSTR-3B had not been filed since February 2021 without specifying jurisdictional facts, particulars of the alleged default, or the demand, and therefore violated the speaking order doctrine and principles of natural justice. For these reasons the petition was allowed and the show cause notice and cancellation were quashed and set aside. [Paras 12, 13, 14]

Quashed and set aside the show cause notice and the order of cancellation of registration on grounds of violation of principles of natural justice for absence of reasons.

Show cause notice with particulars of reasons and opportunity of hearing - cancellation of GST registration - cancellation under Section 30 of the CGST Act - Procedure to be followed on remand after quashing the cancellation order. - HELD THAT: - The Court granted liberty to the respondents to issue a fresh show cause notice incorporating particulars of reasons and relevant details, to afford the petitioner a reasonable opportunity of hearing, and thereafter to pass an appropriate speaking order on merits. The Court made clear that the petitioner would be at liberty to respond to any fresh notice in accordance with law. The direction contemplates full reappraisal on merits by the authority while adhering to the requirement of recording reasons and observing natural justice. [Paras 14]

Respondents permitted to issue fresh notice with particulars and to pass a reasoned speaking order after affording opportunity of hearing; petitioner may respond in accordance with law.

Final Conclusion: Writ petition allowed on grounds of breach of natural justice; the show cause notice and cancellation of GST registration are quashed and set aside with liberty to the revenue to issue a fresh detailed notice, afford a hearing and pass a reasoned order; petition disposed of.

Condonation of delay in filing statutory appeals - principles of natural justice in appellate condonation - date of knowledge as triggering limitation - effect of Covid-19 pandemic on limitation and procedural fairness - restoration of appeal and remand for decision on merits

Condonation of delay in filing statutory appeals - date of knowledge as triggering limitation - effect of Covid-19 pandemic on limitation and procedural fairness - Whether the First Appellate Authority was justified in rejecting the appeal as time-barred without condoning the delay having regard to the petitioner's lack of knowledge and the pandemic period - HELD THAT: - The Court found that the petitioner's return was selected for scrutiny and notices were communicated to the petitioner's chartered accountant by e-mail, so the petitioner remained unaware of the proceedings until his bank account was attached on 6.9.2022. The Appellate Authority mechanically dismissed the appeal as barred by limitation although the appeal was filed 5 months and 22 days after the communication of the order. Having regard to the unprecedented circumstances of the Covid-19 pandemic and the principle that the date of knowledge may be the relevant trigger for limitation, the Court held that the Appellate Authority ought to have considered the pandemic period and the petitioner's date of actual knowledge before refusing to exercise its discretion to condone delay. The Court relied on the need to apply principles of fairness and natural justice when dealing with condonation and noted precedent endorsing a liberal approach to affording opportunity in cases with civil consequences.

The order rejecting the appeal on the ground of delay was quashed; the Court held that the delay was liable to be condoned having regard to the petitioner's date of knowledge and the pandemic circumstances.

Restoration of appeal and remand for decision on merits - principles of natural justice in appellate condonation - Whether the appeal should be restored and the matter remitted to the First Appellate Authority for adjudication on merits - HELD THAT: - On quashing the impugned order, the Court restored the appeal to the file and directed the First Appellate Authority to hear the appeal on merits in accordance with law. The Court emphasised that the Appellate Authority must consider the petitioner's explanation for delay, including the date of actual knowledge (identified as 6.9.2022) and the impact of the pandemic, and afford a fair opportunity before deciding on condonation and the appeal's merits.

The appeal was restored and the First Appellate Authority was directed to decide the appeal on merits after considering the petitioner's explanation and affording a fair hearing.

Final Conclusion: Writ petition allowed; impugned order dated 28.9.2022 rejecting the appeal as time-barred quashed, the appeal restored to the file and the First Appellate Authority directed to hear and decide the appeal on merits after considering the petitioner's date of knowledge and pandemic-related circumstances in accordance with law.

Cancellation of GST registration - validity of show-cause notice - requirement of specific reasons - principles of natural justice - communication of reasons - reinstatement/restoration of registration - second initiation of cancellation proceedings without authority - cancellation of registration under Rule 22(3)

Validity of show-cause notice - requirement of specific reasons - principles of natural justice - communication of reasons - The show-cause notice dated 17.05.2022 was legally infirm for being vague and lacking specific reasons, and the consequent order of cancellation dated 03.08.2022 was quashed; registration restored. - HELD THAT: - The Court found that the show-cause notice dated 17.05.2022 did not communicate any specific or particularized reasons for proposing cancellation and merely used a general averment which was incapable of informing the petitioner of the case it had to meet. The Court applied the settled principle that reasons are the 'heart and soul' of an order and that non-communication of reasons results in denial of a reasonable opportunity and miscarriage of justice. In view of the vagueness of the notice and the petitioner having repeatedly informed the authorities that relevant documents were with the investigating agency (DGGI), the show-cause notice was held bad in law. Consequent cancellation order dated 03.08.2022, which proceeded on that notice and recorded an effective cancellation date of 17.05.2022, was quashed and set aside, and the petitioner's registration was directed to be restored forthwith. The Court expressly declined to go into the merits of the underlying allegations. [Paras 9]

Show-cause notice dated 17.05.2022 quashed for vagueness; order dated 03.08.2022 cancelling registration quashed; registration restored.

Second initiation of cancellation proceedings without authority - reinstatement/restoration of registration - Respondents were permitted to issue a fresh, particularized show-cause notice and proceed thereafter, subject to providing reasonable opportunity of hearing; prior cancellation order merges with appellate order and cannot be relied upon to justify suo-moto re-initiation without particulars. - HELD THAT: - The Court noted that the earlier order of cancellation dated 26.10.2021 had been the subject matter of an appeal which was allowed by the Commissioner (Appeals) on 09.05.2022, resulting in restoration on 12.05.2022. The Court observed there was no authority in the appellate order to permit respondents to initiate a second cancellation proceeding suo-moto absent fresh and specific reasons. Accordingly, while quashing the defective second notice and the consequent cancellation, the Court granted liberty to the respondents to issue a fresh notice if they possess particulars different from those relied upon in the earlier notice dated 28.09.2021. Any such fresh notice must incorporate particulars and reasons, the petitioner must be afforded a reasonable opportunity of hearing, and speaking orders on merits must follow based on the material produced. [Paras 8, 10, 11]

Liberty granted to respondent to issue a fresh, particularized notice and, after affording reasonable opportunity, pronounce a speaking order; earlier cancellation order merges with appellate order and cannot justify summary re-initiation.

Final Conclusion: The petition is allowed to the extent that the show-cause notice dated 17.05.2022 and the cancellation order dated 03.08.2022 are quashed and set aside and the petitioner's GST registration is restored forthwith; respondents may, if they have fresh and particularized reasons different from those earlier relied upon, issue a fresh notice and proceed after giving the petitioner a reasonable opportunity of hearing.

Violation of principles of natural justice - requirement of speaking orders / reasons - quashing of cryptic show cause notice and cancellation order - liberty to issue fresh notice with particulars and opportunity of hearing - restoration of GST registration pending fresh adjudication - costs to be paid by department to welfare fund

Violation of principles of natural justice - requirement of speaking orders / reasons - The impugned show cause notice and the order cancelling the petitioner's GST registration were vitiated for want of adequate reasons and thereby violating principles of natural justice. - HELD THAT: - The Court applied the reasoning in Aggarwal Dyeing and Printing Works, emphasising that reasons are the heart and soul of an order and that quasi judicial authorities must record cogent, clear and succinct reasons. A cryptic show cause notice and a cryptic cancellation order which do not disclose particulars and the rationale deny the affected person a reasonable opportunity to meet the case against him and thereby amount to denial of natural justice. Having found the notice and order to be cryptic and thereby violative of the speaking order doctrine, the Court held them unsustainable and liable to be quashed without entering into the merits of the underlying demand. [Paras 7]

Quash and set aside the impugned show cause notice dated 15.05.2018 and the cancellation order dated 13.08.2018 on the ground of violation of principles of natural justice; merits not adjudicated.

Liberty to issue fresh notice with particulars and opportunity of hearing - restoration of GST registration pending fresh adjudication - Reliefs to be granted consequential to quashing: restoration of GST registration and remand to respondent No.2 to issue a fresh show cause notice with detailed reasons and to provide a reasonable hearing before passing a speaking order on merits. - HELD THAT: - The Court granted liberty to the respondent to issue a fresh notice incorporating particulars and reasons and directed that a reasonable opportunity of hearing be afforded to the petitioner. The Court emphasised that the fresh proceedings must result in an appropriate speaking order on merits and directed that the process be conducted physically as indicated in the precedent relied upon. Meanwhile, the petitioner's GST Registration Number was ordered to be restored forthwith to enable compliance and filing until the fresh adjudication is concluded. [Paras 10]

GST registration restored immediately; respondent No.2 permitted to issue fresh notice with particulars and to provide reasonable hearing and thereafter pass a speaking order on merits.

Costs to be paid by department to welfare fund - discretion not to initiate action against officer - Whether costs should be imposed and whether action should be initiated against the officer who uploaded the defective notice. - HELD THAT: - The Court noted departmental delay and technical glitches in the portal but chose not to initiate disciplinary action against the officer who uploaded the notice. Considering the repetitive nature of such errors and judicial time consumed, the Court quantified costs to be borne by the department and directed payment to the Gujarat High Court Advocates Association Welfare Fund. The Court also observed that GSTN is not a party and left it to the State to work out modalities with GSTN for rectification. [Paras 11]

No action initiated against the concerned officer; department directed to pay costs to the Gujarat High Court Advocates Association Welfare Fund.

Final Conclusion: The petition is allowed solely on the ground of violation of principles of natural justice: the cryptic show cause notice and cancellation order are quashed, the petitioner's GST registration is restored forthwith, respondent No.2 has liberty to issue a fresh, particularised show cause notice and to afford a reasonable hearing and pass a speaking order on merits, and the department is directed to pay costs to the Gujarat High Court Advocates Association Welfare Fund.

Deduction as business expenditure under Section 36(1)(iii) of the Income Tax Act - deduction under Section 57(iii) of the Income Tax Act - commercial expediency test - allocation of fund management charges as interest expense - lifting of corporate veil - Monetary jurisdiction of the Supreme Court - monetary threshold for entertaining appeals

The High Court [2008 (9) TMI 1029 - GUJARAT HIGH COURT] dismissed the revenue's appeal, holding that the Tribunal correctly applied the commercial expediency principle and S.A. Builders [2006 (12) TMI 82 - Supreme Court] to allow the fund management charges as business expenditure under Section 36(1)(iii); issues relevant only to Section 57(iii) were rendered immaterial by that finding.

HELD THAT: - As tax effect in both the appeals for the relevant Assessment Years - 1995-96 and 1996-97 would be less than Rs. 2 Crores which is the monetary limit to prefer an appeal before this Court, as per Circular F.No.390/Misc/115/2017-IC dated 22.08.2019 issued by the Central Board of Indirect Taxes & Customs.

In that view of the matter and on the ground of low tax effect only, the present Appeals stand disposed of.

Civil contempt - wilful disobedience of court order - consequential orders quashed - deletion of entry from web portal as consequential relief - punishment under Section 12 of the Contempt of Courts Act, 1971 - mens rea not essential but wilfulness and deliberation required - limitation on travelling beyond original judgment in contempt proceedings

Civil contempt - wilful disobedience of court order - deletion of entry from web portal as consequential relief - Whether the opposite party committed contempt by failing to give effect to the Division Bench order dated 31.03.2015 quashing the notice dated 11.09.2013 and by permitting the outstanding entry to remain on the web portal for seven months. - HELD THAT: - The Division Bench order dated 31.03.2015 had quashed the notice dated 11.09.2013 for assessment year 2012-13 and directed that consequential orders, if any, be set aside, which included deletion of outstanding entries from the web portal. The Court found on the record, and by the opposite party's own admission, that the outstanding entry continued on the web portal for seven months after the judgment and was deleted only after this Court queried compliance. The continued presence of the outstanding entry on the web portal thereby frustrated the consequential relief directed by the Court and injured the applicant's reputation. The conduct was examined against settled principles that contempt consists of wilful disobedience of a court's order and that disobedience need not always show elaborate mens rea; deliberate and intentional non compliance suffices. Applying these principles to the admitted facts, the Court concluded that the omission to delete the web portal entry was deliberate, amounted to wilful disobedience of the judgment dated 31.03.2015 and thus constituted civil contempt. [Paras 27, 31, 37, 38, 39]

The opposite party was held guilty of civil contempt for willful and deliberate disobedience of the order dated 31.03.2015 by permitting the outstanding entry to remain on the web portal for seven months and thereby failing to give immediate effect to the consequential relief.

Punishment under Section 12 of the Contempt of Courts Act, 1971 - mens rea not essential but wilfulness and deliberation required - limitation on travelling beyond original judgment in contempt proceedings - What punishment is appropriate for the contemnor found guilty of contempt in respect of the above conduct. - HELD THAT: - Having found deliberate disobedience and having considered the aggravating features (senior officer, custodial role regarding the applicant's assessment, and the reputational injury caused by the continued web entry), the Court observed that a fine alone would not meet the ends of justice. While mindful of authorities that caution against overreach in contempt jurisdiction and the need for care in exercising the power, the Court applied the sentencing framework under Section 12 of the Contempt of Courts Act, 1971 and the discretionary considerations discussed in precedents. On this basis the Court imposed both punitive and corrective measures to vindicate the authority of the judicial order and to deter similar conduct by public officials. [Paras 40, 41, 42, 43]

The contemnor was sentenced under Section 12 of the Contempt of Courts Act, 1971 to pay a fine of Rs.25,000 and to undergo simple imprisonment for one week (with one day's further simple imprisonment in default); directions were given for surrender and compliance reporting.

Final Conclusion: Contempt proceedings were allowed: the Deputy Commissioner of Income Tax, Range 2, Lucknow was held guilty of civil contempt for wilful and deliberate non compliance with the Division Bench order dated 31.03.2015 quashing the notice dated 11.09.2013 for assessment year 2012-13; he was sentenced to a fine of Rs.25,000 and simple imprisonment for one week (with default provisions), and directed to surrender for compliance reporting.

Taxation of anonymous donations under section 115BBC - corpus donations and exemption under section 11(1)(d) - inclusion of voluntary contributions in income under section 2(24)(iia) - requirement to maintain record of donor identity and address - adverse inference where AO did not issue notice is impermissible - remand for limited verification of donors without addresses

Taxation of anonymous donations under section 115BBC - corpus donations and exemption under section 11(1)(d) - inclusion of voluntary contributions in income under section 2(24)(iia) - requirement to maintain record of donor identity and address - Whether corpus donations are liable to taxation under the anonymous-donations provision and the interplay between section 115BBC and the exemption for corpus donations under section 11(1)(d). - HELD THAT: - The Tribunal held that voluntary contributions (including corpus donations) are ordinarily part of 'income' under the definition and, while clause (d) of section 11(1) exempts corpus donations from being included in total income, section 115BBC applies to any voluntary contribution falling within section 2(24)(iia) if the recipient does not maintain the record of the donor's identity indicating name and address. The statutory scheme thus subjects corpus donations to the rigour of section 115BBC where the prescribed identity particulars are not maintained, and corpus donations are not immune from section 115BBC merely by virtue of section 11(1)(d). The absence of any further prescribed particulars does not relieve the recipient of the obligation to maintain name and address to avert application of section 115BBC. [Paras 5]

Corpus donations are liable to be taxed under section 115BBC only where the assessee has not maintained the required record of the donor's identity and address; otherwise they remain eligible for exemption under section 11(1)(d).

Adverse inference where AO did not issue notice is impermissible - remand for limited verification of donors without addresses - requirement to maintain record of donor identity and address - Whether the Assessing Officer properly made additions in respect of corpus donations for which the assessee had furnished a donor list with addresses, and what further factual inquiry is required. - HELD THAT: - On the facts, the assessee had maintained a separate register and furnished a list of corpus donors that contained name, receipt number, amount and, in many instances, address. The AO issued notices/summons in respect of some donors and accepted certain donations on verification, but made additions in respect of other donors whose addresses were furnished yet were not subject to any notice. The Tribunal held it was improper to draw an adverse inference in respect of donors for whom the AO did not issue notices; genuineness of donations for donors whose addresses were furnished must be accepted. Consequently, only donations for which the assessee did not give the donors' addresses fall within section 115BBC. The matter is remitted to the AO for examination of the donor list and to make additions solely in respect of donors without addresses, with opportunity of hearing to the assessee. [Paras 6, 7]

AO to examine the furnished donor list and make additions only for those corpus donations where the assessee did not provide the donors' addresses; donations with addresses to be treated as eligible for exemption under section 11(1)(d).

Final Conclusion: The appeal is allowed for statistical purposes; the order is set aside and the matter remitted to the Assessing Officer to verify only those corpus donations for which the assessee did not furnish donor names and addresses, with remaining corpus donations eligible for exemption under section 11(1)(d).

Deduction under section 80P of the Income Tax Act - Revision under section 263 of the Income Tax Act - Explanation 2 to section 263 deeming assessment order erroneous and prejudicial - Limited scrutiny under CASS for verification of Chapter VIA deductions - Opportunity of being heard / principles of natural justice

Deduction under section 80P of the Income Tax Act - Revision under section 263 of the Income Tax Act - Explanation 2 to section 263 deeming assessment order erroneous and prejudicial - Opportunity of being heard / principles of natural justice - Validity of the revisional order under section 263 disallowing deduction claimed under section 80P in respect of interest on fixed deposits and whether the matter required fresh consideration after affording opportunity of hearing to the assessee. - HELD THAT: - The Tribunal noted that the assessing officer had conducted limited scrutiny under CASS to verify Chapter VIA deductions and, in the assessment order dated 10.12.2019, accepted the assessee's claim of deduction under section 80P for A.Y.2017-18. The PCIT invoked Explanation 2 to section 263 and treated the assessment as deemed erroneous and prejudicial insofar as interest earned on fixed deposits with a commercial bank was disallowed under section 80P(2)(d). The Tribunal observed that the assessee had not been heard in response to the show cause process before the revisional order was passed and that the assessee's contention-that the bank interest was incidental to its business and arose from temporary investment of surplus funds-had not been given an opportunity for fresh explanation before the PCIT. In the interest of natural justice and fair adjudication, the Tribunal concluded that the proper course was to set aside the revisional order and remit the matter to the PCIT to afford the assessee an opportunity of being heard and to pass a fresh order after the assessee furnishes the requisite details and cooperates, rather than finally uphold or reverse the disallowance on merits at this stage. [Paras 6]

Order under section 263 set aside and matter remitted to the Principal Commissioner of Income Tax for fresh consideration after affording the assessee an opportunity of hearing; appeal allowed for statistical purposes.

Final Conclusion: The Tribunal set aside the PCIT's revisional order under section 263, remitted the matter to the PCIT to decide afresh after giving the assessee an opportunity of being heard and directed the assessee to cooperate; appeal allowed for statistical purpose (A.Y. 2017-18).

Arm's Length Price (ALP) - Specified Domestic Transaction - Comparable Uncontrolled Price (CUP) method - Transaction Net Margin Method (TNMM) - Comparability and FAR analysis - Remand for verification by Transfer Pricing Officer - Effect of omission of statutory provision on pending proceedings - Expenditure not wholly and exclusively for business - Penalty proceedings consequential to assessment

Remand for verification by Transfer Pricing Officer - Arm's Length Price (ALP) - Comparable Uncontrolled Price (CUP) method - Transaction Net Margin Method (TNMM) - Comparability and FAR analysis - Remittance to TPO to verify pricing and comparability in respect of specified domestic transactions between the assessee and 3F Oil Palm - HELD THAT: - The Tribunal examined the price charts submitted by the assessee, Government of Andhra Pradesh notifications of monthly CPO rates and the sales price data showing that 3F Oil Palm charged the appellant at prices lower than the notified rates and generally lower than prices to third parties. The Tribunal noted that sales to the assessee constituted less than 10% of 3F Oil Palm's total sales. In view of these factual materials and competing contentions on choice of comparables and method (CUP v. TNMM), the Tribunal found it appropriate to remit the issue to the Transfer Pricing Officer for verification of the assessee's claims regarding prices charged to third parties vis-a -vis the assessee and comparison with Government-notified rates, and for determination of ALP after affording the assessee a reasonable opportunity of being heard. [Paras 11, 12, 13, 14]

Matter remitted to the TPO to verify prices and comparables and decide ALP in accordance with law after giving the assessee opportunity of being heard.

Effect of omission of statutory provision on pending proceedings - Validity of invoking clause (i) of section 92BA in assessment completed before its omission - HELD THAT: - The Tribunal considered the contention that clause (i) of section 92BA was omitted by amendment and therefore could not have applied to the assessment. Relying on the timing of the assessment (completed on 27/12/2016) and on principles addressing the effect of omission/repeal and savings clauses, the Tribunal found that the amendment w.e.f. 01/04/2017 did not retrospectively invalidate proceedings already completed. Consequently the additional ground asserting that the clause was inoperative was rejected and dismissed. [Paras 6, 7, 8]

Claim that clause (i) of section 92BA is inoperative in respect of the completed assessment dismissed.

Expenditure not wholly and exclusively for business - Disallowance of miscellaneous expenditure including gift and Vaastu expenses - HELD THAT: - The Tribunal agreed with the CIT(A)'s conclusion that certain miscellaneous expenses, specifically gift expenses and Vaastu expenses, were not incurred wholly and exclusively for business and therefore were rightly disallowed. The Tribunal found no infirmity in the appellate authority's reasoning and dismissed the ground seeking allowance of those expenditures. [Paras 15]

Disallowance of the miscellaneous expenditure upheld and the ground dismissed.

Penalty proceedings consequential to assessment - Whether penalty under section 271(1)(c) should be adjudicated in this appeal - HELD THAT: - The Tribunal observed that initiation of penalty proceedings under section 271(1)(c) was consequential upon the assessment and, as framed in the appeal, did not require separate adjudication at this stage of the proceedings before the Tribunal. The Tribunal therefore refrained from adjudicating the penalty ground in the present appeal. [Paras 16]

Penalty ground not adjudicated by the Tribunal as it is consequential to the assessment.

Final Conclusion: The appeal is partly allowed for statistical purposes: the transfer pricing issues (choice of method, comparability and ALP) are remitted to the TPO for verification and fresh decision after hearing the assessee; the challenge to the applicability of omitted clause (i) of section 92BA is dismissed; the disallowance of miscellaneous expenditure is upheld; and the penalty issue is not adjudicated as it is consequential to the assessment.

Recognition of revenue under Percentage Completion Method (AS-7) - revenue recognition upon transfer of significant risks and rewards - advances treated as interest free deposits and not taxable until completion/transfer of title - income accrual linked to execution/registration of sale deed - obligation to deduct tax at source under section 195 - chargeability of non resident commission where services are rendered or utilised in India / presence of permanent establishment

Recognition of revenue under Percentage Completion Method (AS-7) - revenue recognition upon transfer of significant risks and rewards - advances treated as interest free deposits and not taxable until completion/transfer of title - income accrual linked to execution/registration of sale deed - Whether amounts received as advances/interest free deposits in relation to sale of plots and villas were taxable in the assessment year 2012-13 - HELD THAT: - The Tribunal held that the amounts received could not be taxed in 2012-13. The approval/sanction for the project was received after the end of the relevant financial year and allotment letters expressly treated amounts received as interest free deposits until governmental approval was obtained. Title to the properties was not transferred during the year; transfer occurred subsequently and the assessee has offered income in later years. Reliance was placed on precedents establishing that an agreement to sell (even with receipt of consideration or part performance) does not extinguish vendor's title and profit accrues only on completion of sale by execution/registration of conveyance. In view of these facts and authorities, the receipts retained the character of deposits/advances and were not assessable as income in the year under consideration. [Paras 5, 7, 8]

Amounts received as interest free deposits/advances in relation to plots and villas were not taxable in AY 2012-13 and ground number 2 is allowed.

Obligation to deduct tax at source under section 195 - chargeability of non resident commission where services are rendered or utilised in India / presence of permanent establishment - Whether the assessee was required to deduct tax at source under section 195 on commission paid to non resident agents - HELD THAT: - The Tribunal found no requirement to deduct TDS. It was not disputed that the agents and the purchasers were based outside India, and the Department produced no evidence that the agents rendered services in India, visited India in connection with the services, or maintained a permanent establishment in India. Applying the principle that section 195 is engaged only where income is chargeable to tax in India (i.e., services rendered or utilised in India or through an Indian PE), and having regard to authoritative decisions to like effect, the Tribunal concluded that the commission payments were not chargeable to tax in India and therefore no withholding under section 195 was required; consequential disallowance under section 40(a)(i) (if any) could not be sustained. [Paras 9, 11, 12]

No obligation to deduct tax at source under section 195 arose on payments to the foreign commission agents; ground number 3 is allowed.

Final Conclusion: The assessee's appeal is allowed: receipts from allottees held to be advances/interest free deposits not assessable in AY 2012-13, and no TDS was required on commission payments to the non resident agents.

Revenue expenditure vs capital expenditure - current repairs - commercial expediency test - repair and maintenance obligations under lease/license - deduction under section 31 for current repairs - reimbursement not subject to withholding under section 194C - impotentia excusat / lex non cogit ad impossibilia

Revenue expenditure vs capital expenditure - current repairs - commercial expediency test - repair and maintenance obligations under lease/license - deduction under section 31 for current repairs - Expenditure of Rs.5,02,24,450 claimed as repairs is revenue in nature and allowable. - HELD THAT: - The Tribunal accepted the assessee's factual matrix including technical inspection reports showing the ship-unloader was unsafe and required restoration, the licence obligations obliging the assessee (as licensee/leaseholder) to maintain and repair the project facilities, and the contemporaneous accounting treatment distinguishing repair expenditure (revenue) from separate capitalised upgradation. Applying the commercial expediency test and the statutory concept of 'current repairs' under section 31, the Tribunal held that the repairs were undertaken to preserve and restore existing assets and did not bring a new asset or a new/different advantage into existence. The quantum of expenditure and replacement of parts were not decisive; the nature and purpose of the outlay in the commercial context governed the classification. On these bases the tribunal upheld the CIT(A)'s deletion of the addition and dismissed the revenue's grounds challenging the classification. [Paras 17, 21]

Repairs expenditure of Rs.5,02,24,450 is revenue expenditure and allowable.

Reimbursement not subject to withholding under section 194C - impotentia excusat / lex non cogit ad impossibilia - Disallowance under section 40(a)(ia) for non-deduction of TDS on railway siding and demurrage charges is not sustainable; amounts treated as reimbursements. - HELD THAT: - The Tribunal found as a fact that the charges were levied by the Port Trust on SAIL for delays, and SAIL deducted those charges from amounts otherwise payable to the assessee pursuant to the contractual arrangement under which the assessee acted as handling contractor. There was no payment by the assessee to SAIL or the Port Trust on these accounts; the impugned amounts were effectively reimbursements recovered by SAIL from sums payable to the assessee. Applying the principle that law does not compel the impossible (impotentia excusat / lex non cogit ad impossibilia) and having regard to the contractual and factual matrix, the Tribunal sustained the CIT(A)'s finding that no disallowance under section 40(a)(ia) was warranted. [Paras 22]

Disallowance under section 40(a)(ia) in respect of railway siding and demurrage charges is deleted; amounts are reimbursements and not subject to the disallowance.

Final Conclusion: The revenue appeal is dismissed; the Tribunal upheld the CIT(A)'s allowance of the repair expenditure as revenue in nature and the deletion of the disallowance for non-deduction of tax on the railway siding and demurrage reimbursements.

Long Term Capital Gain exemption claimed on sale of penny stock - treatment of alleged accommodation entries as unexplained cash credit and unexplained expenditure - onus of proof on the assessee to prove genuineness of transactions - test of preponderance of probabilities - use of surrounding circumstances and inferential reasoning to detect manipulation - binding effect of a jurisdictional High Court decision

Long Term Capital Gain exemption claimed on sale of penny stock - onus of proof on the assessee to prove genuineness of transactions - test of preponderance of probabilities - Whether the LTCG claimed on sale of 6,000 shares of a penny stock is a genuine exempt income or must be treated as not genuine and added to income. - HELD THAT: - The Tribunal applied the legal approach and findings of the jurisdictional High Court in Swati Bajaj & others, noting that where shares of little-known companies show a steep and sudden rise in price within a short period, the assessee claiming exemption under the statute bears the onus to prove genuineness, identity and creditworthiness. The court endorsed application of the test of preponderance of probabilities and consideration of surrounding circumstances - including trading volume, persistence of trading in the scrip, proximity between buy and sell operations and the market context - to infer manipulation. Given the similarity of facts and absence of any defence by the assessee, the Tribunal followed the High Court's conclusions that the factual pattern did not establish genuineness and that the conclusion reached by the Assessing Officer and CIT(A) was a permissible inferential finding. [Paras 5, 7, 8]

LTCG on the sale of the penny stock was not accepted as genuine exempt income and the Tribunal dismissed the assessee's challenge, affirming the revenue's conclusion.

Treatment of alleged accommodation entries as unexplained cash credit and unexplained expenditure - use of surrounding circumstances and inferential reasoning to detect manipulation - Whether the addition made by the Assessing Officer (including the 0.5% commission treated as unexplained expenditure) in relation to the alleged accommodation entry is sustainable. - HELD THAT: - The Tribunal, following the High Court in Swati Bajaj & others, upheld the approach of the Assessing Officer and CIT(A) to make inferential findings from the totality of circumstances revealed by the investigation. The Tribunal accepted that the Assessing Officer legitimately treated the transactions as tainted by accommodation entries and made consequential additions, including the imposition of an amount taken as commission, since the assessee did not substantiate the genuineness of the transactions and no one appeared for the assessee to controvert the findings. [Paras 4, 8]

The addition treating the transaction as unexplained (including the 0.5% commission) was upheld and the appeal in respect thereof was dismissed.

Final Conclusion: Following and applying the binding decision of the Calcutta High Court in Swati Bajaj & others, the Tribunal dismissed the assessee's appeal in respect of the LTCG claimed on penny-stock sales and the related addition treated as unexplained, thereby confirming the orders of the Assessing Officer and the CIT(A).

Addition treated as income from undisclosed sources - cash deposits during demonetisation period - explanation of withdrawals as source of deposits - rejection of explanation based on surmises and conjectures - requirement of cogent evidence to sustain addition

Addition treated as income from undisclosed sources - cash deposits during demonetisation period - explanation of withdrawals as source of deposits - requirement of cogent evidence to sustain addition - Validity of the addition of Rs. 7,15,000 made by treating bank cash deposits during demonetisation as unexplained income despite the assessee's explanation that deposits were from earlier bank withdrawals. - HELD THAT: - The Assessing Officer, following CASS selection, treated deposits made during the demonetisation period as unexplained and added a portion of the deposits on the basis that withdrawals earlier in the year appeared to be for household purposes and therefore unlikely to have been retained as cash until demonetisation. The Commissioner (Appeals) sustained that view, characterising the withdrawals as indicating ordinary domestic expenditure and finding the assessee's explanation unreliable. The Tribunal examined the record and found no cogent evidence produced by the revenue to demonstrate that the amounts withdrawn earlier were actually spent or applied to any purpose other than being later deposited. In the absence of affirmative material by the Assessing Officer to contradict the assessee's explanation that the deposits consisted of earlier withdrawals, the addition founded on surmise and conjecture could not be sustained. Applying the requirement that a reasoned basis and evidence are necessary to reject the declared source of deposits, the Tribunal directed deletion of the addition. [Paras 7, 8]

Addition of Rs. 7,15,000 deleted and grounds of appeal allowed.

Final Conclusion: The Tribunal set aside the addition sustained by the Assessing Officer and the Commissioner (Appeals), finding that the revenue failed to produce cogent evidence to displace the assessee's explanation that the demonetisation-period deposits were from earlier bank withdrawals, and allowed the appeal.

Disallowance of expenditure indicated in the audit report - processing of return under section 143(1) - tax audit report as factual record versus recommendation for disallowance - quasi-judicial obligation to give reasons when disposing objections in processing - due date for credit under Explanation to section 36(1)(va) - payment made before filing return under section 139(1) - recomputation of consequential interest

Disallowance of expenditure indicated in the audit report - processing of return under section 143(1) - tax audit report as factual record versus recommendation for disallowance - payment made before filing return under section 139(1) - Validity of disallowing employees' contribution to Provident Fund by CPC during processing of return under section 143(1)(a)(iv) based on tax audit report entries showing delayed remittance but actual payment before filing of return - HELD THAT: - The Tribunal found that the tax auditor had only recorded the factual dates of statutory due date and actual payment and had not indicated or recommended any disallowance. Clause (iv) of section 143(1)(a) operates where the audit report indicates a disallowance which the assessee has not reflected in the return. A mere factual entry in the audit report, without an express suggestion of disallowance, does not fall within the description in section 143(1)(a)(iv). Further, where the employees' contribution, though remitted after the statutory due date, was paid before the due date for filing the return under section 139(1), the reporting of delayed payment in the audit report cannot by itself constitute an 'indication' entitling automatic disallowance in processing. The Tribunal relied on the necessity of a proper quasi judicial exercise by the CPC-including consideration of objections with specific reasons-before making adjustments under section 143(1), and observed that audit opinions do not bind the assessee nor displace binding judicial precedents on the legal effect of the 'due date' when payment is made prior to filing. Applying these principles to the facts, the Tribunal concluded that the CPC's disallowance was not permissible under section 143(1)(a)(iv) and was vitiated in law. [Paras 4, 5, 6, 9, 10]

Impugned disallowance of employees' contribution to Provident Fund made while processing the return under section 143(1) is deleted; appeal on these grounds allowed.

Recomputation of consequential interest - Direction on consequential computation of interest arising from deletion of the disallowance - HELD THAT: - The Tribunal treated the questions on interest as consequential to the deletion of the addition. It directed the Assessing Officer to recompute interest in accordance with law in light of the deletion, leaving precise calculation to statutory provisions governing interest for defaults. [Paras 7]

Assessing Officer directed to recompute interest consequentially in accordance with law.

Final Conclusion: The appeal is allowed: the adjustment made by CPC disallowing employees' contribution to Provident Fund in processing under section 143(1) is deleted and the Assessing Officer is directed to recompute consequential interest as per law.

Suo moto revision under Section 263 of the Income tax Act - Erroneous and prejudicial to the interest of the Revenue - Limited scrutiny under CASS - Verification of cash in hand and invocation of Section 68 for unexplained cash credit - Carry forward of unabsorbed depreciation - Prejudice to Revenue test

Suo moto revision under Section 263 of the Income tax Act - Limited scrutiny under CASS - Verification of cash in hand and invocation of Section 68 for unexplained cash credit - Erroneous and prejudicial to the interest of the Revenue - Whether the Principal Commissioner was justified in invoking revisionary powers under Section 263 to set aside the assessment on the ground that the Assessing Officer failed to verify the substantial increase in cash in hand. - HELD THAT: - The Tribunal held that the Assessing Officer had selected the return for limited scrutiny to verify the large cash-in-hand and during assessment called for and considered cash book, sales tax returns, bank statements and other supporting documents. On being satisfied with the explanation, the AO accepted the return and made no addition. Once the AO has conducted enquiries and accepted the explanation, the PCIT cannot invoke Section 263 merely on the basis that the enquiry was inadequate; Section 263 jurisdiction cannot be exercised where some enquiry has been made and the revising authority only disagrees with the sufficiency of that enquiry. The Tribunal noted that the revisional power is available where there is no enquiry at all, but not to supplant the AO's judgment on adequacy of inquiries. The approach was held to be consistent with the principle laid down by the High Court in CIT v. Gabriel India Ltd. . Applying these principles to the facts, the PCIT's conclusion that the assessment was erroneous and prejudicial for want of verification was unsustainable. [Paras 7]

PCIT erred in revising the assessment under Section 263 on the cash in hand issue; the assessment order on this point is upheld.

Carry forward of unabsorbed depreciation - Prejudice to Revenue test - Suo moto revision under Section 263 of the Income tax Act - Whether the Principal Commissioner was justified in invoking revisionary powers under Section 263 on the ground that the Assessing Officer improperly allowed carry forward of unabsorbed depreciation from earlier years. - HELD THAT: - The Tribunal observed that the assessment under challenge relates to AY 2015-16 for which the assessee returned nil total income and did not seek set off of any brought forward unabsorbed depreciation. The AO accordingly had no occasion to examine earlier years' depreciation carry forwards in the context of the impugned assessment year. Even if the PCIT's observation about belated returns for earlier years were correct, brought forward unabsorbed depreciation is properly examinable only when the assessee claims set off in a year in which there is positive income. Because there was no claim for set off and no resultant prejudice to revenue in AY 2015 16, exercise of revisionary power was not warranted. [Paras 8]

PCIT erred in revising the assessment under Section 263 on the ground of carry forward of unabsorbed depreciation; no revision was called for for AY 2015 16.

Final Conclusion: The Tribunal allowed the appeal, quashed the Principal Commissioner's order passed under Section 263, and upheld the assessment order dated 30.10.2017 for Assessment Year 2015 16.

Application of section 68 as to unexplained cash credits - burden of proof in respect of source of cash deposits - verification of affidavits and duty to summon alleged payors - estimation of income from unexplained cash deposits

Application of section 68 as to unexplained cash credits - burden of proof in respect of source of cash deposits - verification of affidavits and duty to summon alleged payors - Whether the addition made under section 68 on account of cash deposits could be sustained when the assessee filed affidavits from persons who allegedly supplied the cash and the CIT(A) rejected those affidavits without further verification. - HELD THAT: - The Tribunal found that the assessee explained that the cash deposits represented amounts received from relatives against sale of the deceased wife's jewellery and placed on record sworn affidavits of nine persons supporting that explanation. Although the assessee did not produce documentary evidence beyond the affidavits, the CIT(A) summarily rejected those affidavits without initiating further enquiries or summoning the deponents to verify the claim. The Tribunal held that when affidavits are filed to explain cash credits, the authorities have a duty to verify the claim by suitable enquiries (including summoning the alleged payors) before treating the deposits as unexplained and assessing them under section 68. Consequently, the CIT(A)'s summary rejection of the affidavits without such verification was improper and the addition could not be sustained in the form recorded by the lower authorities. [Paras 6]

CIT(A)'s summary rejection of the affidavits was unjustified and the addition under section 68 could not be sustained without further verification.

Estimation of income from unexplained cash deposits - What remedial course should be adopted where the assessee has not fully substantiated the source of cash deposits but the assessing authority likewise has not verified the affidavits. - HELD THAT: - Having concluded that neither party had conclusively established the matter on evidence (the assessee by documentary proof, and the authorities by verification of deponents), the Tribunal exercised its remedial discretion to settle the dispute by directing a reasonable estimate. To meet the ends of justice and resolve the controversy, the Tribunal directed the Assessing Officer to assess 20% profit on the total cash deposits found in the assessee's bank account and delete the balance of the addition made under section 68. This direction balances the absence of full proof with the need to finalise assessment. [Paras 6]

Directed AO to assess 20% profit on total cash deposits and delete the remaining addition under section 68.

Final Conclusion: The appeal is partly allowed: the CIT(A)'s summary rejection of the affidavits was held improper and, in consequence, the Tribunal directed the Assessing Officer to assess 20% profit on the total cash deposits and delete the balance of the addition made under section 68 for Assessment Year 2004-05.

Validity of proceedings under section 153C based on satisfaction of the Assessing Officer - Admissibility of seized/impounded material (including survey material under section 133A) for initiating proceedings under section 153C - Time bar and computation of six preceding assessment years for section 153C - Assessment under section 144 in absence of return and additions founded on seized material - Penalty under section 271(1)(c) for concealment of income due to wilful non filing/non substantiation

Validity of proceedings under section 153C based on satisfaction of the Assessing Officer - Admissibility of seized/impounded material (including survey material under section 133A) for initiating proceedings under section 153C - Proceedings under section 153C were validly initiated on the basis of the Assessing Officer's recorded satisfaction and the seized/impounded material. - HELD THAT: - The Tribunal accepted the CIT(A)'s finding that the Assessing Officer furnished a remand report recording reasons for issuing notice under section 153C, identifying incriminating material and annexures linking the seized/impounded material to the assessee's transactions and real estate business. The CIT(A) concluded that the satisfaction was not abstract, that seized material and statements showed transactions attributable to the assessee and that the AO was therefore justified in issuing notice under section 153C. In the absence of any representation or additional evidence from the assessee, the Tribunal found no infirmity in the CIT(A)'s examination and rejected the challenge to the validity of initiation of proceedings under section 153C. [Paras 5, 6]

Challenge to initiation of proceedings under section 153C rejected; proceedings held valid.

Time bar and computation of six preceding assessment years for section 153C - Assessment year 2006-07 falls within the six preceding assessment years for the notice issued on 23/07/2013 and is not barred. - HELD THAT: - The assessee contended that the six year look back should be computed from the date the AO received impounded material (23/07/2013) so that AY 2006-07 would be time barred. The CIT(A) rejected this construction as artificial and contrary to the purpose of the provision, observing that adopting the assessee's view would produce anomalous results (e.g., extending the year of search to an unrelated AY). The Tribunal, with no contrary representation, concurred with the CIT(A)'s reasoning and upheld the conclusion that AY 2006 07 was not beyond the permissible preceding years. [Paras 7]

Claim that AY 2006-07 is beyond six preceding years rejected; notice period computation upheld.

Assessment under section 144 in absence of return and additions founded on seized material - Additions (opening capital, loans/advances, and unexplained amount for property purchase) sustained where the assessee failed to file returns or substantiate claimed amounts. - HELD THAT: - The assessee did not file returns despite multiple notices and, when represented, relied on pleas of ignorance and produced no new evidence before the CIT(A). The CIT(A) found that the overall materials and statements indicated taxable transactions and that the assessee had, after survey, access to professional assistance and knowledge of consequences, making the plea of ignorance untenable. Specific items-opening capital, loans and advances, restricted agricultural income and unexplained sum towards plot purchase-were examined; where the assessee failed to produce cogent evidence (including tax audit reports or particulars for the disputed amounts), the CIT(A) confirmed the additions. The Tribunal, noting no representation or additional material, found no infirmity in those confirmations. [Paras 9, 10, 11, 12]

Additions confirmed for the reasons given by the CIT(A); grounds challenging these additions dismissed.

Penalty under section 271(1)(c) for concealment of income due to wilful non filing/non substantiation - Penalty under section 271(1)(c) was validly imposed and confirmed by the CIT(A) as constituting concealment by wilful failure to file returns and to substantiate income. - HELD THAT: - The assessee challenged the penalty on multiple legal grounds (including alleged invalidity of the underlying assessment under section 153C, defects in show cause notice, absence of mens rea, and reliance on survey rather than search). The CIT(A) found that the assessee was a habitual non filer, did not respond adequately to notices, engaged professional assistance yet failed to substantiate investments or income, and did not produce tax audit reports where applicable. On these facts the CIT(A) held the failure to file/ substantiate to be wilful concealment. The Tribunal, in the absence of any representation or additional material from the assessee, agreed with the CIT(A)'s factual and legal conclusion and upheld the penalty. [Paras 20]

Penalty under section 271(1)(c) upheld; penalty appeals dismissed.

Final Conclusion: For AYs 2006-07 to 2012-13 the Tribunal upheld the CIT(A)'s conclusions: initiation of proceedings under section 153C was valid, the contested additions were sustainable in the absence of substantiation by the assessee, and penalties under section 271(1)(c) were properly imposed; all appeals are dismissed.

Revisionary jurisdiction under section 263 - disallowance under section 14A - Rule 8D apportionment for expenditure relating to exempt income - exempt income by virtue of section 86 (share in income of association/body) - non-application of mind / failure to investigate by Assessing Officer - erroneous order prejudicial to the interest of revenue

Disallowance under section 14A - exempt income by virtue of section 86 (share in income of association/body) - Rule 8D apportionment for expenditure relating to exempt income - Whether the order of the Assessing Officer was erroneous and prejudicial to the interest of revenue for not making disallowance under section 14A in respect of exempt income received from a joint venture, thereby justifying exercise of revisionary jurisdiction under section 263. - HELD THAT: - The Tribunal found that the assessee had itself disclosed that it received exempt income as a share from a joint venture under section 86 and that the Assessing Officer had formally sought details regarding expenditure relating to exempt income during assessment proceedings. Notwithstanding the disclosure and the information supplied, the AO did not apply his mind to compute or examine disallowance under section 14A read with Rule 8D. Citing the Malabar Industries test, the Bench held that an order may be treated as erroneous when passed without application of mind or without investigation of the issue; since the AO failed to investigate and compute the disallowance despite material on record showing receipt of exempt income, the order was held to be erroneous and prejudicial to the revenue. The Tribunal therefore concluded that the PCIT was justified in exercising revisionary jurisdiction to set aside the assessment for fresh consideration of section 14A disallowance. [Paras 15, 16, 18, 21]

The assessing officer's order is erroneous and prejudicial to the interest of the Revenue for failing to make or examine disallowance under section 14A in respect of exempt income from the joint venture; exercise of jurisdiction under section 263 was valid.

Revisionary jurisdiction under section 263 - non-application of mind / failure to investigate by Assessing Officer - erroneous order prejudicial to the interest of revenue - Whether the PCIT was justified in setting aside the assessment under section 263 for failure of the Assessing Officer to examine investments capable of earning exempt income and to consider corresponding disallowance. - HELD THAT: - The Tribunal noted that substantial investments in unquoted shares and mutual funds, shown in balance-sheets for the relevant year, were not addressed in the assessment order and no discussion was recorded that these investments did not yield exempt income or that the assessee had furnished particulars. The AO therefore did not examine whether interest or other expenditures attributable to such investments required disallowance. Reliance was placed on authoritative principles that section 263 can be invoked where material facts disclosed are not properly examined by the AO. On these facts, the Tribunal upheld the PCIT's conclusion that the assessment order was erroneous and prejudicial to the revenue and rightly set it aside for fresh assessment. [Paras 6, 8, 22]

The PCIT rightly set aside the assessment under section 263 for failure of the AO to examine investments capable of earning exempt income and to consider consequent disallowance; fresh assessment was directed.

Final Conclusion: The appeal is dismissed. The order passed by the Principal Commissioner under section 263 setting aside the assessment is upheld and the matter is remitted for fresh assessment to examine and compute disallowance under section 14A/Rule 8D and related issues.

Rectification under section 154 - mistake apparent on record - mixed question of fact and law - change in shareholding and carry forward of losses under section 79 - company in which public are substantially interested (section 2(18)) - doctrine of incorporation (definition of private/public company)

Rectification under section 154 - mistake apparent on record - mixed question of fact and law - change in shareholding and carry forward of losses under section 79 - company in which public are substantially interested (section 2(18)) - Whether the Assessing Officer could invoke rectification power under section 154 to disallow set off of carried forward losses and unabsorbed depreciation by applying the test of section 79. - HELD THAT: - The Tribunal held that exercise of power under section 154 is confined to correction of a mistake apparent on the face of the record and cannot be used to reconsider or review a debatable question involving mixed issues of fact and law. Determination of applicability of section 79 necessarily requires interpretation of the definition of a "company in which the public are substantially interested" under section 2(18) and of provisions of the Companies Act, and engages competing judicial precedents and factual inquiry (shareholding changes, control/management). As the question whether section 79 applied in the appellant's case required such examination and was not an obvious clerical or manifest error, it did not amount to a mistake apparent on record capable of being rectified under section 154. Applying these principles to the facts, the Tribunal concluded that the AO erred in invoking section 154 to disallow the carry forward claim and therefore cancelled the AO's action under section 154. [Paras 24, 25, 26, 27]

Tribunal allowed the ground challenging exercise of section 154, held that disallowance under section 79 was not a mistake apparent on record and deleted the AO's rectification; the section 154 order was set aside.

Change in shareholding and carry forward of losses under section 79 - company in which public are substantially interested (section 2(18)) - doctrine of incorporation (definition of private/public company) - Whether the appellant fell outside the ambit of section 79 because it became a company in which the public are substantially interested (and related subsidiary/public company issues). - HELD THAT: - The Tribunal did not decide the substantive merits of grounds 1 and 2. Although the appellant contended that, on the facts (majority shareholding by a listed company) and by application of section 2(18) and Companies Act definitions, section 79 would not apply, the Tribunal observed that these questions involve factual and legal determination and conflicting authorities which must be examined on merits. Consequently the Tribunal expressly left grounds 1 and 2 open without expressing any opinion. [Paras 27]

Grounds 1 and 2 left open for determination; no adjudication on their merits was made by the Tribunal.

Final Conclusion: The appeal is allowed to the extent that the Assessing Officer's order passed under section 154 disallowing carried forward losses and unabsorbed depreciation was set aside as not being a rectification of a mistake apparent on record; the Tribunal cancelled the AO's exercise of jurisdiction under section 154. Grounds 1 and 2 were left open for fresh consideration and were not decided.

Appeal under section 9C of the Customs Tariff Act - quasi judicial character of governmental determination under section 9A - duty to record reasons and comply with principles of natural justice - remand for fresh consideration of recommendation of designated authority - provisional assessment/pending provisional levy under section 9A(2)

Appeal under section 9C of the Customs Tariff Act - quasi judicial character of governmental determination under section 9A - Maintainability of the appeal under section 9C and nature of Central Government's decision under section 9A - HELD THAT: - The Tribunal held that the appeal against the Central Government's communication declining to accept the designated authority's recommendation is maintainable under section 9C. Examining the statutory scheme and earlier decisions, the Bench concluded that the Central Government's function in taking a determination under rule 18/read with section 9A is of a quasi judicial character (or, at the least, conditional legislation requiring procedural safeguards). Consequently, when the Central Government forms an opinion not to accept a positive recommendation, it must examine relevant factors and is subject to review by the Tribunal. [Paras 26, 27, 28, 29, 33]

The appeal is maintainable and the Central Government's determination under section 9A is quasi judicial in nature and amenable to judicial review.

Duty to record reasons and comply with principles of natural justice - remand for fresh consideration of recommendation of designated authority - Validity of the Central Government's office memorandum not to impose anti dumping duty where no reasons were recorded and no opportunity was given - HELD THAT: - The Tribunal found that the designated authority had conducted a detailed investigation and positively recommended imposition of anti dumping duty. The Central Government's office memorandum merely stated that the recommendation was not accepted without recording reasons or affording the domestic industry an opportunity to be heard. Applying the requirements of natural justice and the necessity to record reasons when rejecting a positive recommendation, the Tribunal held the decision cannot be sustained. The matter is therefore set aside and remitted to the Central Government for fresh decision-making in light of the Tribunal's observations, requiring recording of reasons and compliance with principles of natural justice. [Paras 7, 8, 33, 46]

The office memorandum is set aside; the matter is remitted to the Central Government to reconsider the designated authority's recommendation after recording reasons and complying with principles of natural justice.

Provisional assessment/pending provisional levy under section 9A(2) - Interim protection in the form of provisional assessment pending the Central Government's fresh decision - HELD THAT: - Recognising the need to protect interests during the period required for reconsideration by the Central Government, and having regard to analogous interim directions issued by High Courts, the Tribunal directed that provisional assessment of imports of the subject goods from the subject countries be made for the time being. The Tribunal clarified that this provisional assessment shall not create any equities in favour of the domestic industry and shall not affect the ultimate decision to be taken by the Central Government on reconsideration. [Paras 45]

Provisional assessment to be made pending the Central Government's fresh decision; such direction creates no equities and does not affect the substantive reconsideration.

Final Conclusion: The office memorandum dated 06.06.2022 declining to accept the designated authority's recommendation is set aside for want of reasons and non compliance with natural justice; the appeal is maintainable; the matter is remitted to the Central Government for fresh, reasoned consideration in accordance with the Tribunal's observations; provisional assessment directions shall operate until the Central Government decides.

Late fee for delayed presentation of bill of entry under Section 46(3) of the Customs Act, 1962 - purging/erasure of bill of entry in ICEGATE and its legal effect - judicial satisfaction of proper officer for imposition of late fee - requirement of a reasoned order and natural justice in exercise of discretion - precedential value of High Court decision holding purging not contemplated and waiver of late fee

Late fee for delayed presentation of bill of entry under Section 46(3) of the Customs Act, 1962 - purging/erasure of bill of entry in ICEGATE and its legal effect - Validity of imposing and confirming the late fee under Section 46(3) where a bill of entry was filed by the next day but subsequently purged/erased in the ICEGATE system - HELD THAT: - The Tribunal found on the material on record that the appellant had in fact filed a bill of entry on the next day after arrival, and that the first bill was later purged/erased in the ICEGATE system after debit of duties. There is no provision in the Customs Act or the Bill of Entry (Electronic Integrated Declaration and Paperless Processing) Regulations, 2018 that contemplates purging of a bill of entry; consequently imposing late fee merely because a second bill was filed following such purging was irregular. The proper officer's conclusion that the bill was filed beyond time was not supported by consideration of the original filing and ignored the system-related purging, which could not fairly be treated as the importer's fault. Reliance on the reasoning in the High Court decision that purging is not contemplated under the Act and that discretion ought to have been exercised to grant waiver was noted with approval. [Paras 3, 5, 6]

Imposition and confirmation of the late fee was irregular and is set aside; consequential refund to be made.

Judicial satisfaction of proper officer for imposition of late fee - requirement of a reasoned order and natural justice in exercise of discretion - Whether the Assistant Commissioner and the Commissioner (Appeals) lawfully exercised discretion and provided a reasoned order before levying and confirming the late fee - HELD THAT: - The Tribunal held that the satisfaction of the proper officer required by Section 46(3) is a judicial or rational satisfaction and must be manifestly free from arbitrariness or mala fide. Neither the Assistant Commissioner nor the Commissioner (Appeals) provided a reasoned, speaking order explaining why the original bill of entry filed on the next day was not accepted; the impugned communications were non speaking and ignored documentary proof in the appellant's possession. It was also unreasonable to require the appellant to produce system-level evidence of an ICEGATE error when the system is under departmental control. The absence of a reasoned exercise of discretion and failure to afford a fair hearing rendered the impugned orders unsustainable. [Paras 3, 4]

Orders imposing and confirming the late fee quashed for want of reasoned satisfaction and breach of natural justice; appellant entitled to relief.

Final Conclusion: The appeal is allowed; the order confirming the late fee is set aside with consequential refund, and the customs authority is directed to pay litigation costs to the appellant.

Condonation of delay - sufficient cause for condonation - negligence of counsel as a ground for condonation - pre-deposit requirement for preferring appeal - remand for adjudication on merits - power of the appellate authority to condone delay limited by the statutory proviso

Condonation of delay - sufficient cause for condonation - negligence of counsel as a ground for condonation - power of the appellate authority to condone delay limited by the statutory proviso - Delay of more than two and a half years in filing the appeal before Commissioner (Appeals) cannot be condoned. - HELD THAT: - The Tribunal examined the record and found no credible evidence of due diligence by the appellant which could constitute a sufficient cause for the long delay. Notices of personal appearance and opportunities to file a reply were afforded at the adjudication stage; correspondence on record did not establish that the previous counsel was guilty of such negligence as would justify excusing the appellant. There was no affidavit from the previous counsel admitting negligence, nor any demonstrable steps taken by the appellant to ascertain or rectify counsel's alleged default. While the principles in Mst. Katiji requiring a liberal, justice-oriented approach were considered, the Tribunal held they do not mandate condonation where the record does not show reasonable diligence. Reliance was placed on the statutory limit recognised in Singh Enterprises, that the appellate authority's power to condone delay is confined by the proviso to the statute and does not extend beyond the prescribed period; hence the Commissioner (Appeals) rightly refused to condone a delay of the magnitude present here. [Paras 5, 6, 7, 8, 9]

Application for condonation of delay was rejected; the delay was not a sufficient cause to entertain the appeal.

Pre-deposit requirement for preferring appeal - remand for adjudication on merits - Whether the matter should be remanded to Commissioner (Appeals) for adjudication on merits despite the delay not being condoned. - HELD THAT: - Although the appellant deposited the amount required as pre-deposit before this Tribunal (including the portion stated to be 7.5% required before Commissioner (Appeals)), the Tribunal found no reason to remit the matter to the Commissioner (Appeals) for merits because the threshold question of maintainability - the statutory bar on entertaining the long-delayed appeal - was not overcome. The Commissioner (Appeals) had correctly dismissed the appeal on the ground of delay in accordance with the statutory limits, and compliance with the pre-deposit requirement did not cure the fundamental defect of excessive delay. [Paras 10]

No remand; the matter will not be sent back to Commissioner (Appeals) for merits adjudication.

Final Conclusion: The impugned order of Commissioner (Appeals) dismissing the appeal on the ground of inordinate delay is upheld and the appeal is dismissed; remand for adjudication on merits is refused despite the pre-deposit having been made.

Punishment for false statement and liability under Section 447 arising from Section 448 - Applicability of stringent bail conditions in economic offences and money laundering jurisprudence - Right to speedy trial and remedial provision under Section 436A of the Code of Criminal Procedure - Obligation of directors to exercise due diligence and liability for signing financial statements - Section 212(6) twin conditions (Companies Act) and their relevance to offences attracting punishment under Section 447

Punishment for false statement and liability under Section 447 arising from Section 448 - Section 212(6) twin conditions (Companies Act) and their relevance to offences attracting punishment under Section 447 - Applicability of stringent bail conditions in economic offences and money laundering jurisprudence - Whether the petitioner, accused of offences under Section 448 of the Companies Act, 2013, is entitled to grant of regular bail in view of the statutory link between Section 448 and punishment under Section 447 and the seriousness of economic offences. - HELD THAT: - The court examined sub section (b) of Section 448 and held that an offence under Section 448 entails punishment under Section 447, thereby bringing within contemplation the rigors applicable to offences attracting Section 447. The court relied on the principle that economic offences are gravely injurious to the public and invoked the reasoning in Vijay Mandanlal Choudhary (supra) concerning the compelling State interest in stringent bail conditions for economic/money laundering type offences. Having regard to the detailed SFIO investigation, the allegations of false statements, inflated figures and diversion/siphoning of funds across numerous companies, and the statutory linkage between Section 448 and Section 447, the court concluded that the petitioner was not entitled to the concession of bail.

Bail refused; petition dismissed.

Obligation of directors to exercise due diligence and liability for signing financial statements - Right to speedy trial and remedial provision under Section 436A of the Code of Criminal Procedure - Whether the petitioner's plea of being a 'dummy' or dormant director who merely signed financial statements absolves him of criminal liability or warrants grant of bail. - HELD THAT: - The court found no material on record to substantiate the claim of being a dummy director. It reiterated that under the Companies Act a director must discharge duties with due diligence and cannot escape liability merely by asserting dormancy where he has actively participated and signed financial statements. While the judgment acknowledges the jurisprudence on right to speedy trial and the existence of Section 436A as a protective provision, the court observed that the seriousness and extent of the allegations and the investigation's findings outweighed the petitioner's asserted defence, and therefore the claim of being a dormant director did not justify bail in the facts of the case.

Petitioner's 'dummy director' plea rejected for bail purposes; no relief granted.

Final Conclusion: The petition for regular bail is dismissed; having regard to the statutory link between Section 448 and punishment under Section 447, the gravity of the allegations arising from the SFIO investigation, and the absence of material to substantiate the petitioner's claim of being a dummy director, the petitioner is not entitled to bail.

Change of corporate name not amounting to transfer of property - stamp duty not chargeable on mere change of name of a company - statutory vesting on amalgamation or conversion - no requirement of separate conveyance where transfer is by operation of law - permission under Section 118 of the H.P. Tenancy and Land Reforms Act not required where no transfer of land takes place - administrative clarification dated 16.02.2012 on name-change and stamp duty

Change of corporate name not amounting to transfer of property - stamp duty not chargeable on mere change of name of a company - administrative clarification dated 16.02.2012 on name-change and stamp duty - Whether the petitioner-company is liable to pay stamp duty or require permission under Section 118 for recording in revenue records the change of its name from a public limited company to a private limited company when there has been no sale, purchase or change in ownership or management. - HELD THAT: - The Court applied the instructions dated 16.02.2012 which distinguish between (a) an amalgamation or statutory transfer where property may vest by operation of law and stamp duty may be chargeable unless the sanctioning Court directs otherwise, and (b) a mere change of an existing company's name under the Companies Act where no transaction in property occurs. The record shows the petitioner obtained a Certificate of Incorporation reflecting only a change of name under the Registrar of Companies; there is no material to indicate any sale, purchase or change in ownership or management affecting the company's land. Reliance was placed on precedents and reasoning reproduced in the Division Bench decision in JSTI Transformers Pvt. Ltd. and other authorities holding that statutory vesting or conversion operates by law and that mere change of corporate name or change in corporate form where property vests by operation of law does not attract stamp duty in the absence of an instrument of transfer. Applying these principles, the Court found the respondents' demand for stamp duty and their refusal to record the name change to be unjustified where only the name was changed and no transfer of property occurred, and directed respondents to effect the change without insisting on payment of stamp duty. [Paras 17, 18, 20, 21, 22]

Impugned order refusing to record the change of name is quashed; respondents directed to effect the change of name in revenue records without insisting upon payment of stamp duty.

Final Conclusion: Writ petition allowed; order dated 13.01.2016 quashed and respondents directed to record the petitioner as M/s Inox Air Products Private Limited in the revenue records without demanding stamp duty, the change being a mere corporate name-change with no transfer of property.

Duty of the resolution professional to furnish agenda and documents to participants of the Committee of Creditors - right of the erstwhile Board of Directors/suspended management to receive resolution plans - confidentiality undertaking to govern access to resolution plans - fresh consideration by the Committee of Creditors after full disclosure - exclusion of time spent in these proceedings from the CIRP period

Duty of the resolution professional to furnish agenda and documents to participants of the Committee of Creditors - right of the erstwhile Board of Directors/suspended management to receive resolution plans - confidentiality undertaking to govern access to resolution plans - The suspended management (erstwhile Board of Directors) is entitled to be furnished with copies of the resolution plans placed before the CoC, subject to a confidentiality undertaking. - HELD THAT: - The Tribunal accepted the settled position in Vijay Kumar Jain v. Standard Chartered Bank & Ors. that participants (including erstwhile directors) must receive the agenda and all documents relevant to matters to be discussed at CoC meetings, which encompasses resolution plans. The Tribunal noted that, although the resolution professional had created a data room procedure requiring confidentiality undertakings, the suspended management had not been given the resolution plan. In view of the precedent and the Regulations cited, the suspended management must be provided copies of the resolution plans; the resolution professional may require execution of confidentiality undertakings before granting access. [Paras 6, 7]

Provide the suspended management with copies of the resolution plans; access may be conditioned upon a confidentiality undertaking.

Fresh consideration by the Committee of Creditors after full disclosure - exclusion of time spent in these proceedings from the CIRP period - After furnishing the resolution plans to the suspended management, the CoC must reconvene, deliberate afresh on the resolution plans and take a decision; the time consumed in these proceedings is to be excluded from the CIRP period. - HELD THAT: - The Tribunal directed that once the suspended management is supplied with the plans, the resolution professional shall convene a CoC meeting for fresh deliberation and voting, permitting the CoC to either approve or reject plans afresh and to consider other relevant objections of the suspended management. The Tribunal further applied the principle from Vijay Kumar Jain that time taken in such adjudications should be excluded from the CIRP timeline. A timeframe of two weeks was fixed for compliance and the matter will be placed in the cause list after minutes are filed. [Paras 8, 9, 10]

Reconvene the CoC for fresh consideration after disclosure; exclude the time of these proceedings from the CIRP period and list the matter after minutes are filed.

Final Conclusion: The resolution professional is directed to furnish the resolution plans to the suspended management (subject to confidentiality undertakings), reconvene the CoC to deliberate and vote afresh within two weeks, consider other relevant objections, and record minutes; the time consumed in these proceedings shall be excluded from the CIRP period and the matter will be listed after filing of the minutes.

Voluntary disclosure - declaration in Form SVLDRS-1 - payment within 30 days under Rule 7 - debarment from filing under Section 125(1)(e) - no relief for voluntary disclosure under Section 124(1)(e) - presumption of nullity for false declaration within one year under Section 129 - Sabka Vishwas (Legacy Dispute Resolution) Scheme

Declaration in Form SVLDRS-1 - Sabka Vishwas (Legacy Dispute Resolution) Scheme - Declaration in Form SVLDRS-1 was filed within the time prescribed by the Scheme. - HELD THAT: - The petitioner filed the declaration in Form SVLDRS-1 on 31.12.2019 which was within the period prescribed by the Scheme and Rule 3. The Court records that the filing of the declaration itself was timely, although subsequent issues relating to the nature and correctness of the declaration and payment compliance remained to be considered. [Paras 25, 26]

Declaration in Form SVLDRS-1 was filed in time.

Payment within 30 days under Rule 7 - Petitioner did not make the payment specified in Form SVLDRS-3 within 30 days as required and belated attempts did not meet the stipulated time. - HELD THAT: - Form SVLDRS-3 was issued on 13.01.2020 and the 30-day period expired on 12.02.2020. The petitioner attempted payment on 16.03.2020 and amounts initially debited were later re credited, with no effective payment within the 30 day window. The extension notifications relating to COVID 19 relief were held inapplicable to the petitioner because the due date under Form SVLDRS-3 had already expired prior to the notified extension period that benefitted persons required to pay between 20.03.2020 and 29.06.2020. [Paras 5, 6, 12, 28]

Payment requirement in Form SVLDRS-3 was not complied with within 30 days and the belated attempts did not cure the default.

Voluntary disclosure - debarment from filing under Section 125(1)(e) - no relief for voluntary disclosure under Section 124(1)(e) - presumption of nullity for false declaration within one year under Section 129 - The petitioner's declaration was in the category of a voluntary disclosure, the disclosures were found to be untrue, the petitioner was debarred under Section 125(1)(e), and therefore not entitled to the Scheme's relief. - HELD THAT: - The Court examined the Scheme provisions and held that a voluntary disclosure does not attract relief under Section 124(1)(e). Section 125(1)(e) debarred persons who had been subjected to enquiry/investigation where the duty involved was not quantified by 30.06.2019 from filing declarations. The designated committee is not required to verify voluntary disclosures (Section 126) but Section 129 provides that if a material particular in a voluntary declaration is found false within one year of the discharge certificate, the declaration is treated as never made and proceedings may be instituted. On the facts the Court found the petitioner's disclosures in Form SVLDRS-1 were not true and the petitioner was therefore not entitled to relief under the Scheme. [Paras 17, 18, 19, 30, 31]

Declaration was a voluntary disclosure, found to be untrue; petitioner was debarred and not entitled to relief under the Scheme.

Sabka Vishwas (Legacy Dispute Resolution) Scheme - discharge certificate - Petitioner's subsequent payment on 29.12.2021 did not entitle it to the Scheme's benefit and the writ petition was dismissed. - HELD THAT: - Although the petitioner paid the amount indicated in Form SVLDRS-3 on 29.12.2021, the Court held that payment of the specified sum after the expiry of the stipulated period and in the context of a voluntary and incorrect declaration did not entitle the petitioner to the Scheme's concessions. The Designated Committee's finding in the impugned order that the disclosures were not true and consequential demand, interest and penalties were affirmed as justifying rejection of the SVLDRS relief. The writ petition was dismissed with liberty to pursue statutory appeal remedies. [Paras 32, 33]

Late payment did not confer entitlement to Scheme benefits; writ petition dismissed.

Final Conclusion: The High Court found the declaration was filed in time but was a voluntary and incorrect disclosure, the petitioner failed to pay within the 30 day period prescribed by Form SVLDRS 3, and was debarred from relief under the Scheme; the writ petition is dismissed with liberty to file the statutory appeal within thirty days.

Rectification of mistakes apparent from the record - power under Section 62 (rectification) not to be used as review or substitute for appeal - mistake apparent from the record must be obvious and patent and not established by a long drawn process of reasoning - prejudice from tribunal's manifest error justifies rectification where material on record was overlooked - application of pro rata calculation for sales tax incentives under Package Schemes of Incentives

Rectification of mistakes apparent from the record - power under Section 62 (rectification) not to be used as review or substitute for appeal - mistake apparent from the record must be obvious and patent and not established by a long drawn process of reasoning - Whether the Sales Tax Tribunal rightly exercised its power under Section 62 to set aside its earlier order and restore the matters for fresh hearing. - HELD THAT: - The Court considered the scope of Section 62 which permits rectification only of a "mistake apparent from the record" and emphasised authority that such a mistake must be obvious and patent, not one requiring a long drawn process of reasoning. Applying that standard, the Tribunal's First Order reflected a conscious application of what it regarded as a general proposition of law from Pee Vee Textiles and was not shown to have omitted or overlooked that authority or its factual distinctions. The Tribunal therefore did not commit a manifest, patent error on the face of the record that would justify invocation of rectification powers; instead the Respondent's proper remedy was to challenge the First Order by appeal. Consequently the exercise of Section 62 to set aside the First Order and direct fresh consideration exceeded the statutory scope of rectification and was impermissible. [Paras 10, 11, 16, 18]

The Tribunal's exercise of rectification power under Section 62 was beyond its remit and impermissible; the rectification orders are quashed.

Prejudice from tribunal's manifest error justifies rectification where material on record was overlooked - application of pro rata calculation for sales tax incentives under Package Schemes of Incentives - Whether the Rectification Applications were maintainable on the specific grounds that (a) the Tribunal failed to consider its own earlier decision in Balkrishna Industries Ltd. and (b) the Tribunal misapplied or overlooked factual distinctions in Pee Vee Textiles. - HELD THAT: - The rectification application alleged two discrete defects: non consideration of the coordinate Bench decision in Balkrishna Industries Ltd., and failure to appreciate factual distinctions in Pee Vee Textiles. The Court found no allegation or material showing that the Balkrishna decision had been placed before the Tribunal when the First Order was passed; accordingly that ground did not establish a mistake apparent on the record. As to Pee Vee Textiles, the Tribunal had explicitly considered that decision and reached a conscious conclusion that its legal proposition applied; this was a debatable application of law and facts rather than a patent omission or manifest error susceptible to rectification. Thus neither ground sustained the invocation of Section 62. [Paras 13, 14, 15, 16]

Rectification could not be justified on either ground; the alleged omissions did not amount to a mistake apparent on the record.

Final Conclusion: Writ petition allowed; the Sales Tax Tribunal's rectification orders dated 21 December 2009 are quashed and set aside. Observations are confined to the correctness of exercise of power under Section 62.

Exclusion of time under Section 14 of the Limitation Act, 1963 - condonation of delay - distinction between exclusion of time and condonation of delay - maintainability but non-entertainment of writ petition - remand to appellate authority for merits

Exclusion of time under Section 14 of the Limitation Act, 1963 - maintainability but non-entertainment of writ petition - The period between filing of the writ petition and its dismissal as not entertained is to be excluded in computing limitation for the subsequent appeal. - HELD THAT: - The Court held that the appellant filed a writ petition on 24.02.2018 which was not entertained on 07.03.2018 with a direction to approach the Appellate Authority. Where a writ proceeding is maintainable but not entertained, the time spent in pursuing that remedy falls for exclusion under Section 14, subject to the conditions of that provision. Exclusion of such period is legally distinct from condonation of delay and, once excluded, must not be counted for computing any period of delay to be condoned. The bona fides of filing the writ petition were not challenged and the appellant promptly approached the Appellate Authority after dismissal of the writ petition, supporting exclusion in the facts of the case. [Paras 3, 4]

The period from 24.02.2018 to 07.03.2018 is excluded for computation of limitation.

Condonation of delay - distinction between exclusion of time and condonation of delay - Application for condonation of delay in filing the appeal is to be allowed after excluding the period when the writ petition was pending. - HELD THAT: - Applying the exclusion, the Court found that the appeal filed after the dismissal of the writ petition fell within the condonable period. The Court emphasised that exclusion under Section 14 prevents that period from being counted towards the delay; consequently, the appellant's application for condonation should be treated as allowed. The Court directed condonation of the delay so that the appeal can be adjudicated on merits. [Paras 4, 5]

The application for condonation of delay is allowed and the delay is condoned.

Remand to appellate authority for merits - The appeal is to be examined on merits by the Appellate Authority. - HELD THAT: - Having allowed exclusion and condoned the delay, the Court remitted the matter to the Appellate Authority with a direction to examine the appeal on merits. The Court expressly refrained from expressing any opinion on the substantive merits of the dispute, limiting its order to procedural relief and remand for fresh consideration by the competent appellate forum. [Paras 5, 6]

The Appellate Authority is directed to examine the appeal on merits; no opinion expressed on merits by this Court.

Final Conclusion: The impugned High Court order is set aside to the extent it held the delay beyond condonable period; the period during which the writ petition remained pending is excluded, the application for condonation is allowed, the delay is condoned, and the appeal is remitted to the Appellate Authority for decision on merits, with the Supreme Court expressing no view on the substantive issues.

Power to initiate disciplinary proceedings suo motu - meaning of "information" under Section 21 - distinction between "information" and "complaint" under the Rules - scope and effect of Rule 7 of the 2007 Rules - use of external material and media reports as triggers for investigation - purposive interpretation of statutory disciplinary provisions

Power to initiate disciplinary proceedings suo motu - purposive interpretation of statutory disciplinary provisions - Whether the Institute of Chartered Accountants of India can initiate disciplinary proceedings suo motu under Section 21 of the Chartered Accountants Act, 1949. - HELD THAT: - Section 21 empowers the Directorate to make investigations in respect of "any information or complaint". The Court examined the language of Section 21 (noting the prefix "any" and the disjunctive use of "information or complaint"), the statutory purpose of the Institute as a regulator, and precedent interpreting the words "information" and "complaint". The Court held that "information" was intended to have wide amplitude and that the Act contemplates investigations on material that comes to the Institute's notice even if not in the form of a formal written complaint. Comparative decisions where bodies lacked suo motu powers were distinguished on their statutory language. The Court also relied on the Division Bench's observations in P. Ramakrishna recognising that information may include material that comes to the Institute's knowledge or is provided by a third party who may not wish to file a formal complaint. Accordingly, the statutory scheme and purpose permit the Institute to proceed on its own motion where cogent information exists. [Paras 85, 94, 95, 96, 121]

Section 21, read purposively, empowers the Institute to initiate disciplinary investigations suo motu on the basis of "any information" that comes to its notice; a written complaint is not a pre requisite.

Meaning of "information" under Section 21 - distinction between "information" and "complaint" under the Rules - use of external material and media reports as triggers for investigation - Whether newspaper reports or other external material can constitute "information" under Section 21 and whether the proceedings in this case were based solely on media reports. - HELD THAT: - The Court analysed dictionary and jurisprudential meanings of "information" and "complaint" and the scheme of the Rules. It concluded that "information" is wider than a complaint and may include knowledge derived from an external source. However, a mere newspaper report is not evidence per se and, standing alone, cannot justify initiation of a disciplinary enquiry. Media reports may, nevertheless, operate as a trigger for the Institute to investigate further. Applying these principles to the present facts, the Court examined the show cause notice, the Directorate's subsequent communication of 13 March 2018 and the material (including the Limited Review Report and PNB minutes). The Court found that the Institute did not act solely on newspaper reports: the reports prompted further scrutiny, the LRR and other material were examined, and the Directorate possessed cogent information warranting initiation of inquiry. [Paras 110, 114, 115, 116, 121]

A newspaper report alone cannot constitute "information" to initiate proceedings, but media reports may trigger collection and evaluation of external material; on the facts the Institute had requisite information (not merely media reports) to commence inquiry.

Scope and effect of Rule 7 of the 2007 Rules - distinction between "information" and "complaint" under the Rules - Whether Rule 7 restricts the meaning of "information" in Section 21 to only written allegations conforming to the procedure in Chapter II (i.e., non Form I written material), and whether Rule 7 can be read to curtail Section 21. - HELD THAT: - The Court considered the hierarchical relationship between the Act and subordinate Rules, the text of Rule 7 and related provisions (Rules 3, 5, 8, 11 and 12). Rule 7 was held to operate as a statutory fiction to treat certain written material not in Form I as "information" under Section 21 and to prescribe procedural handling (e.g., offering informants the option to file a complaint). But a rule cannot be used to constrict the parent statute. Rule 7 does not exhaust the ambit of "information"; it preserves and validates non Form I written material but does not prevent the Institute from acting upon other cogent information derived from external sources. [Paras 70, 72, 101, 104, 121]

Rule 7 creates a procedural fiction for certain written material but does not limit or curtail the wider meaning of "information" under Section 21; Rule 7 cannot be read to override the parent statute.

Final Conclusion: The writ petitions are dismissed. The Court holds that Section 21, read purposively, empowers the Institute to initiate disciplinary investigations suo motu on the basis of "any information" that comes to its notice; newspaper reports alone do not suffice but may trigger further inquiry, and Rule 7 of the Rules is a procedural provision that does not narrow the statute. The Institute may proceed in accordance with law; the petitioners remain free to challenge any final adverse order.