High Court of Allahabad

Atul Kumar Tripathi vs. State Of U.P. (Neutral Citation: 2024:AHC:101797)

MANU/UP/1959/2024

05.06.2024

Criminal

Court must consider nature and gravity of accusation, antecedent of accused, possibility of accused to flee from justice, while deciding anticipatory bail

The present application has been moved seeking anticipatory bail in Case registered under Sections - 419, 420, 467, 468, 471, 406, 506, 120-B of Indian Penal Code, 1860 (I.P.C.), with the prayer that in the event of arrest, applicant may be released on bail.

In case of Siddharam Satlingappa Mhetre v. State of Maharashtra, it has been held by Hon'ble Supreme Court that while deciding anticipatory bail, Court must consider nature and gravity of accusation, antecedent of accused, possibility of accused to flee from justice and that Court must evaluate entire available material against the accused carefully and that the exact role of the accused has also to be taken into consideration.

From the prosecution version and statement of informant, it appears that informant was cheated in a calculated way and malafide intention on part of applicant is writ large. The arrest of applicant was stayed during investigation, it is apparent that the arrest of the applicant was stayed due to the reason that matter was referred to mediation but there is nothing to show that applicant made any sincere effort to settle the dispute or return the amount of applicant. In view of nature of accusations, it could not be said at this stage that matter is purely civil in nature. The anticipatory bail application of co-accused has already been rejected by the co-ordinate Bench of present Court, however one of the ground of rejection is that the same was filed directly before this Court, without approaching the Session Court. It appears that role of co-accused is distinguished from the applicant, who is kingpin of the entire incident.

In view of nature of accusations, role of applicant and all attending facts of the case, without expressing any opinion on merits, no case for anticipatory bail is made out. Accordingly, the instant anticipatory bail application is rejected.

Tags : Accusation Anticipatory bail Grant

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High Court of Karnataka

Mr. Shyamal Mukherjee vs. Pricewaterhouse Coopers Services LLP

MANU/KA/1596/2024

04.06.2024

Arbitration

Appointment of arbitrator can be challenged only in circumstances that give rise to justifiable doubt as to his independence or impartiality

Present Petition is filed under Section 11(5) of the Arbitration and Conciliation Act, 1996, ('the Act, 1996') seeking appointment of a sole Arbitrator in terms of the arbitration clause contained in the LLP Agreement dated 21st March, 2017. The issue therefore is, whether an Arbitrator who is considering another dispute between the same or one of the parties is barred from trying a dispute in the light of Entry 24 of the Fifth Schedule of the Act, 1996?

Grounds for challenging appointment of an Arbitrator are provided in sub-section (3) of Section 12. Such appointment can be challenged only if circumstances exist that give rise to justifiable doubt as to his independence or impartiality. If the relationship of the Arbitrator with the parties or Counsel or the subject matter of the dispute falls under any of the categories specified in the Seventh Schedule of the Act, such person shall be ineligible to be appointed as an Arbitrator, in terms of sub-section (5) of Section 12. It is not the case of the Respondent that, the person sought to be appointed as Arbitrator incurs any of the disqualification under the Seventh Schedule.

The Hon'ble Apex Court in HRD Corporation(Marcus Oil And Chemical Division) Vs. Gail (India) Limited (Formerly Gas Authority of India Limited) and PanipatJalandar NH-1 Tollway Private Limited Vs. National Highways Authority of India has held that, the disqualification contained in Entry 22 and 24 are not absolute, if he/she is able to show that he/she was independent and impartial on the earlier two occasions.

It is therefore clear that as an Arbitrator, if a person has decided a dispute earlier or has been appointed as an Arbitrator on two or more occasions by one of the parties or an affiliate of one of the parties, that by itself is not a bar for his appointment as an Arbitrator subsequently, if it is possible for such Arbitrator to show that he was independent and impartial on the earlier occasion. Therefore, it is too farfetched to contend that a person serving as an Arbitrator in a dispute involving the petitioner and affiliate of the Respondent herein is barred from being appointed as an Arbitrator in the present case.

Entry 24 will not apply as a rule for declining appointment of Hon'ble Justice M.S.Sanklecha to adjudicate the dispute between the petitioner and the Respondent, which is admittedly an affiliate of Pricewaterhouse Coopers Pvt. Limited (Company). Petition allowed.

Tags : Appointment Arbitrator Independence

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Customs, Excise and Service Tax Appellate Tribunal

Shree Balaji Engicons Pvt. Ltd. Vs. Commissioner, Central Excise, Customs and Service Tax

MANU/CK/0158/2024

04.06.2024

Service Tax

Extended period of limitation cannot be invoked when there is no intention to evade payment of Service Tax

In facts of present case, the Appellant have executed two work orders dated 31.07.2007 and 24.03.2007 for their client viz. Vedanta Aluminium Limited, Jharsuguda. The above said work orders executed by the Appellant are for: (i) piping work under railway line and (ii) boulder pitching for construction of road. The Appellant was of the view that, the services rendered in respect of railways and construction of road are exempted from levy of Service Tax and accordingly, had not paid Service Tax on the said activities.

A Show Cause Notice was thereafter issued to the Appellant demanding Service Tax of Rs.3,87,212 (including cess) for the period 2007-08, proposing to classify the services rendered by the Appellant under the category of 'commercial or industrial construction service'.

The Notice was adjudicated by the Learned Assistant Commissioner of Central Excise & Customs, who vide Order-in-Original confirmed the demand of Service Tax along with interest and imposed penalty equal to the quantum of Service Tax confirmed in the order. On appeal, the Learned Commissioner (Appeals) vide the impugned order has also upheld the demands confirmed in the Order-in-Original.

The appellant has executed two work orders to their client namely, Vedanta Aluminium Ltd. The work order dated 31.07.2007 is meant for piping work in respect of railway lines. A perusal of the said work order shows that the works have been rendered to the railways and during the relevant period, services rendered to the railways were exempted from Service Tax. It is also observed that, the other work order dated 24.03.2007 is actually meant for construction of road and there was no liability to discharge Service Tax in respect of the said services rendered towards construction of road.

Further, from the Work Orders, present Tribunal observe that the services rendered are rightly classifiable under the category of 'works contract service' as they involve transfer of property in goods. It is observed that the client has registered the aforesaid contracts under the Odisha Value Added Tax Act, 2004 and paid Works Contract Tax to the Government, but, in the Notice, no demand has been made under 'Work Contract Service'. Thus, the demand confirmed under 'Commercial or Industrial Construction Service' is not sustainable and hence present Tribunal set aside the same.

Regarding, the demand of service tax by invoking extended period of limitation, there is no suppression with intention to evade payment of Service Tax established in the present case. Hence, the Show Cause Notice demanding Service Tax for the period 2007-08 issued on 20th October, 2010 is barred by limitation. Accordingly, the demands confirmed in the impugned order are liable to be set aside on the ground of limitation also. The impugned order is set aside. Appeal allowed.

Tags : Demand Confirmation Legality

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Customs, Excise and Service Tax Appellate Tribunal

RS Software India Limited vs. Commissioner of Service Tax

MANU/CK/0157/2024

04.06.2024

Service Tax

Services received by permanent establishments of Appellant abroad cannot be considered as services received in India, demand of service tax is not sustainable

The Appellant is engaged in development of software at its development centre in Kolkata. The Appellant is registered with Service Tax Commissionerate, under the category of Management Maintenance or Repair Service and Business Auxiliary Service. For running their business, the Appellant has set up branch offices at various countries, which are all their permanent establishments.

The department initiated an investigation against the Appellant alleging that the services received by them from non-resident banks are liable to service tax under the category of Banking and other Financial Services, under reverse charge mechanism. Accordingly, it was alleged that the Appellant was liable to pay service tax of Rs.94,20,154 for the period from 1st April, 2007 to 31st March, 2012.A Show Cause Notice was issued to the Appellant demanding service tax of Rs.94,20,154 and proposing to deny the Cenvat credit of Rs.3,05,57,728. The said Notice was adjudicated vide the impugned order and the demands raised in the Notice has been confirmed along with interest and penalty. Aggrieved against the confirmation of the demands, the Appellant has filed present appeal.

Regarding the demand of service tax of Rs.94,20,154, present Tribunal observe that, the Appellant has been working through a network of branch offices located abroad. These branch offices are permanent establishments and not mere representative offices. They provide services to their clients in their own rights, raise invoices, incur expenditure, avail bank facilities, have its own technical and human resources and operate as independent units. They do not claim any reimbursement of expenditure from the Corporate Office.

Section 66A(2) of the Finance Act, 1994 clearly lays down that permanent establishments in different countries shall be treated as separate persons. Therefore, the services received by these permanent establishments of the appellant abroad cannot be considered as services received by the appellant in India, on reverse charge basis. Thus, the demand of service tax from the Appellant is not sustainable and accordingly, present Tribunal set aside the demand confirmed in the impugned order on this count. Since the demand itself is not sustainable, the question of demanding interest and imposing penalty does not arise. As the demand is not sustainable, no penalty imposable under Section 77 of the Finance Act, 1994 and Rule 7(c) of the Service Tax Rules, 1944.

Regarding, disallowance of Cenvat Credit, present Tribunal observe that, the Appellant produced photo copies of the invoices before the adjudicating authority at the time of personal hearing. However, the adjudicating authority rejected those invoices on the ground that they were not authenticated and the invoices were not legible. The Appellant now submits that they have the original copies of all the invoices and they can submit the same before the concerned authorities for verification. For the purpose of verification, the matter needs to be remanded back to the adjudicating authority.

The demand of service tax of Rs.94,20,154 along with interest and penalty equal to the tax imposed on the Appellant is set aside. Penalties imposed under Section 77 of the Finance Act, 1994 and Rule 7(c) of the Service Tax Rules, 1944 are also set aside.With respect to denial the Cenvat credit of Rs.3,05,57,728, present Tribunal set aside the demand of Cenvat credit disallowed along with interest and penalty and remand the matter back to the adjudicating authority. Appeal disposed off.

Tags : Demand Penalty Legality

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High Court of Delhi

Ajay vs Employees State Insurance Corporation And Anr. (Neutral Citation: 2024:DHC:4720)

MANU/DE/4029/2024

03.06.2024

Education

Fixation of cut off dates is permissible and is largely immune from judicial scrutiny, unless the person aggrieved makes out a positive case of arbitrariness

In facts of present case, the Petitioner is the ward of an Insured Person (“Ward of IP”) within the meaning of Employees’ State Insurance Act, 1948. The Petitioner applied for participation in the NEET UG 2024, for obtaining admission to MBBS courses conducted by medical colleges across the country. The ESIC has restricted the entitlement of reservation to dependent male “Ward of IP” to candidates who had yet to attain the age of 21 years by 10 April 2024. The Petitioner is aggrieved thereby. He complains that, by virtue of fixing of 10 April 2024 as the date by which a dependent male “Ward of IP” would have had to be less than 21 years of age, the petitioner has become disentitled to the reservation available to “Ward of IP”, as per the policy of the ESIC, as he crossed the age of 21 years before 10thApril 2024.

The fixing of the aforesaid cut-off date does not, in any manner, impact the Petitioner’s right to participate in the NEET UG 2024 or to secure admission to a medical college as per his rank in the said examination. Fixation of cut off dates has been held, by the Supreme Court, to be permissible in several decisions, and is largely immune from judicial scrutiny, unless the person aggrieved makes out a positive case of arbitrariness or discrimination thereby.

No doubt, the grant of “Ward of IP” reservation is a beneficial provision. That, however, cannot be a basis for this Court to interfere with the cut-off date fixed by the ESIC. Fixation of any cut-off date is always bound to result in prejudice to some persons, who may not qualify. So long as there is no basis urged on the basis of which the fixing of the cut-off date can be said to be arbitrary, the Court cannot interfere. It is also a settled position that the onus to establish such arbitrariness is on the person so urging.

The cut-off date was fixed in accordance with Clause 9 of the admission policy of the ESIC, which was approved by Central Government. The fixation of the cut-off date does not merit interference. It is not possible for this Court to accept the Petitioner’s submission that the fixing of the cut-off date for reckoning the age of 21 years as 10 April 2024 in Clause 7.9.2 of the impugned admission notice dated 24 April 2024, issued by the ESIC, is arbitrary in any manner or warranting interference under Article 226 of the Constitution of India. Petition dismissed.

Tags : Cut-off date Fixation Legality

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Income Tax Appellate Tribunal

Talegaon Nagari Sahakari Patsanstha Limited vs. Income Tax Officer

MANU/IP/0120/2024

03.06.2024

Direct Taxation

Interest income earned by cooperative society on deposits made out of surplus funds with cooperative banks as well as schedule bank qualifies for deduction

In facts of the case, the Appellant is a Cooperative Society registered under the Maharashtra Co-operative Societies Act, 1960. It is engaged in the business of providing credit facilities to its members and accepting deposits from them. The Return of Income for the assessment year 2020-21 was filed declaring Nil after claiming deduction of Rs.52,68,351 under Section 80P(2)(a)(i) of Income Tax Act, 1961 (IT Act).

Against the said return of income, the assessment was completed by the AO vide order disallowing the deduction claimed under Section 80P(2)(a)(i) of IT Act. While doing so, the Assessing Officer had brought to tax the interest income of Rs.52,68,351 earned on FDs with other co-operative banks holding that the said interest does not qualify for deduction.Being aggrieved, an appeal was filed before the NFAC, who vide impugned order confirmed the action of the Assessing Officer. Being aggrieved, the Appellant is in appeal before this Tribunal in the present appeal.

The only issue in the present appeal relates to the eligibility of the assessee for exemption under Section 80P(2)(a)(i) or under Section 80P(2)(d) of the IT Act in respect of interest income earned from cooperative banks. The issue is no more res integra as the same is covered by catena of decisions passed by the Pune Benches allowing the deduction under Section 80P(2)(a)(i) of the Act. The Co-ordinate Bench of the Tribunal in the case of The Ugar Sugar Works Kamgar & Dr. Shirgaokar Shaikshanik Trust Nokar Co-op Credit Society vs. ITO held in favour of the appellant society.

Following the decision of the Co-ordinate Bench of this Tribunal, present Tribunal is of the considered opinion that, even the interest income earned by cooperative society on deposits made out of surplus funds with cooperative banks as well as schedule bank qualifies for deduction both under the provisions of Section 80P(2)(a)(i) and Section 80P(2)(d) of the Act, therefore, the reasoning given by the lower authorities on this issue cannot be accepted. Thus, present Tribunal direct the Assessing Officer to allow deduction under Section 80P(2)(a)(i) and 80P(2)(d) in respect of interest income earned from cooperative banks. Appeal allowed.

Tags : Assessment Interest Deduction

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