Tax LawBeat: Your Daily Tax Law Newsletter
INCOME TAX CASES:
CIT Vs Mehta Charitable Prajanalaya Trust [ITA No. 154/2019] – February 12, 2021
Delhi HC held that it is clear that the penalty proceedings are arising as an outcome of the assessment proceedings, which is still being debated upon. If the issue is debatable, penalty proceedings cannot lie. Law on this subject is well settled and this court, as recently as on 22nd December 2020 in the case of Pr. Commissioner of Income Tax (Central)-2 Vs. Harsh International Pvt. Ltd., reiterated the position in law in respect of levy of penalty when the issue is debatable.
There is no finding that any details supplied by the Assessee in its return were found to be incorrect, erroneous or false. In fact, as noted in the impugned order dated 26th December, 2017, CIT (A) has categorically observed that no evidence had been brought on record to adduce that furnishing of inaccurate details had been done by the Assessee wilfully, in order to avoid the payments of tax, or to conceal the particulars of income. Hence the Court finds there to be no substantial question of law arising in this case.
ACIT Vs Dosch Pharmaceuticals Pvt Ltd [ITA No. 4164/M/2019] – February 01, 2021
Mumbai ITAT held that expenses incurred on distribution & marketing of physician samples of certain medicines manufactured by the assessee, merit being allowed u/s 37(1), where such samples are meant for increasing sales of the manufacturing company & to study the medicine's effects.
ACIT Vs Devu Tools Pvt Ltd [ITA Nos. 4165/Mum/2019] – February 02, 2021
Mumbai ITAT held that addition framed on account of purchases made from alleged hawala operators merits being restricted to 10% of the total amount rather than the total quantum of purchases, where the assessee has discharged onus of establishing genuineness of purchases.
RAYTHEON COMPANY Vs ADD DIT [ITA No. 5857 to 5861/Del/2010 & ITA No. 4802 to 4805/Del/2010] – March 31, 2021
Delhi ITAT held that undisputedly, the taxpayer is a non-resident company having established Permanent Establishment in India and its entire tax was to be deducted at source by the payee on payment and as such, the taxpayer was not under any obligation to make payment of advance tax. In these circumstances, levy of interest u/s 234B from the taxpayer is not sustainable in the eyes of law. So, following the decision rendered by Delhi High Court in GE Packaged Power Inc., this Tribunal is of the considered view that when undisputedly the taxpayer is a non-resident company and tax has been deducted at source on the entire payment made to it by the payee and it is under no obligation to make payment of advance tax and in these circumstances, levy of tax u/s 234B is not sustainable, hence ordered to be deleted.
INDIRECT TAX CASES:
Anand Distributors Vs UoI [W.P.(MD)No.25528 of 2019 & W.M.P.(MD)No.22081 of 2019] – March 02, 2021
Madras HC observed that the Case of the petitioner is that when CGST Act came into force on 01.07.2017, they were entitled to a credit of Rs.5,03,202/-. The petitioner would state that though he made several attempts to file form GST TRAN-1, he could not do so due to technical glitches, therefore, they made a representation but the same was rejected by the order dated Aug 28, 2019. The sixth respondent had stated that in the impugned communication that there is no evidence to show that there was a system error in the log. Questioning this, the writ petition has been filed.
HC held that the case on hand is squarely covered by the Single Judge order dated Feb 14, 2020 made in W.P.No.3328 of 2020 and which order was upheld by the Division Bench in M/ s. Checkpoint Apparel, by dismissing the appeal of the Department by imposing costs and directing that the due benefit of input credit of stocks, as on July 01, 2017, shall be given to the Assessee either by accepting the offline copy of Form Tran-1 submitted by the Assessee or by allowing him to resubmit the same on E-portal of the GSTN by providing opportunity to Assessee to do it now.
There can be no doubt that the petitioner made effort to upload the details on the web portal. Even according to the respondents, though Rule 117 of CGST Rules, 2017, originally stipulates that Form TRAN-1 is filed within 90 days, there was a periodical extension and the final extended date was March 31, 2020. In the present case, the impugned order itself came to be passed on Aug 28, 2019. Therefore, applying the aforesaid decision made in W.P.(MD)No.3328 of 2020, the communication impugned in the writ petition is quashed.
Sekar And Company Vs Pr.Secretary CCT [W.P.(MD)No.16323 of 2019] – March 02, 2021
Madras HC (Madurai Bench) observed that the case of the petitioner is that due to technical glitches, the petitioner could not file the said Form TRAN-1. The petitioner claims that they approached the office of the second respondent in person on at least two occasions to present the Form TRAN-1 manually and submitted a representation but since there has been no response, the present petition. Counsel for the Revenue submitted that petitioner had already missed the bus and, therefore, no relief can be granted in this writ proceeding.
HC held that the case on hand is squarely covered by the Single Judge order dated Feb 14, 2020 made in W.P.No.3328 of 2020 and which order was upheld by the Division Bench in M/s.Checkpoint Apparel by dismissing the appeal of the Department by imposing costs and directing that the due benefit of input credit of stocks, as on July 01, 2017, shall be given to the Assessee either by accepting the offline copy of Form Tran-1 submitted by the Assessee or by allowing him to resubmit the same on E-portal of the GSTN by providing opportunity to Assessee to do it now. Petitioner has made out a clear case for grant of relief. Therefore, respondents 2 and 3 are directed to facilitate the uploading of Form TRAN-1.