The Madras High Court has ruled that tax planning as opposed to tax evasion has legal sanction, and if a dealer plans his transactions in such a manner that he pays less tax, it is not open to the revenue to subject him to a conscience audit or moral assessment. The power to lift the veil has to be exercised with great care and caution.
Justice V Ramasubramanian on Friday allowing petitions by a registered dealer, challenging the orders of assessment passed by the Assistant Commissioner, Coimbatore, under the Central Sales Tax Act for assessment years 2001-02, 2002-03 and 2003-04.
Associated Cement Companies Limited, Coimbatore, claimed that the cement manufactured at Madukkarai was dispatched as stock transfer to its warehouses and depots in Kerala, Karnataka and Puducherry.
Thereafter, it was sold in the respective states after paying local sales tax there. The company claimed exemption on the turnover relating to branch/stock transfer.
Suspecting the petitioner’s claim, the Assistant Commissioner (AC) issued pre-assessment notices stating that the company was moving goods to states from the factory site itself to reach the ultimate buyers there.
The company filed Form ‘F’ declarations with proof of payment of taxes in other states. The AC passed orders for the assessment years on the ground that the petitioner had failed to file the other statements and records as stipulated in Central Sales Tax (Tamil Nadu) Rules.
Aggrieved, the present petitions were filed.
Setting aside the assessment orders, Mr Justice Ramasubramanian said the dealer had a factory in Tamil Nadu and claimed exemption in the state on stock transfer made to his branches in other states.
Another dealer having a factory in another state may make similar claim in that state on the basis of the stock transferred to a branch in Tamil Nadu and the tax paid here.
While the state was deprived of revenue in the former situation, it benefited in the latter. Justice Ramasubramanian said the AC had erred in arriving at an ad hoc conclusion without an inquiry under the Act that the transactions were inter-state sales, merely on account of the goods not getting unloaded at Palakkad but proceeding further in its journey to the buyer’s place.
The Judge remitted the matter back to the AC for an inquiry after which the official should complete assessment and pass an order.
Details of the case are:
W.P.Nos.4709 to 4711 of 2009 And M.P.Nos.1,1 and 1 of 2009
Associated Cement Companies Ltd vs. The Assistant Commissioner (CT)(FAC)& ors.
If a problem can be solved, no need of worry about it.... If a problem can not be solved, what is the use of worrying?
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Thursday, June 4, 2009
Tuesday, June 2, 2009
Execution- simple objection -flagrant violation of the eviction decree
IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 6954 OF 2003
Sardar Estates -vs- Atma Ram Properties (P) Ltd
ORDER
This appeal furnishes a typical instance of a widespread malady which has infected the judicial system in the country, namely, the flagrant abuse of the process of the Court.
The respondent, which is the owner and landlord of premises no.13/46, Scindia House, Connaught Circus, New Delhi filed an eviction petition against the appellant, who is the tenant, before the Rent Controller, Delhi in 1981. That petition was decreed on 12.5.1993 on the ground of subletting. The appellant filed an appeal before the Rent Control Tribunal which was dismissed on 22.9.1998. Thereafter he filed a second appeal which was dismissed by the Delhi High Court on 31.1.2000. Against that order he filed an SLP in this Court which was dismissed as withdrawn by order dated 8.12.2000. He then filed a Review Petition before the Delhi High Court which was dismissed on 9.2.2001. Against that order the appellant filed another SLP in this Court which was dismissed on 9.4.2001. By that order he was directed to vacate the premises and handed over physical possession to the landlord on or before 31.10.2001 subject to the usual undertaking to be filed within four weeks. However, the appellant did not file the undertaking.
In execution proceedings the appellant filed an objection on 16.3.2001 which was rejected by the Executing Court on 14.9.2001. Against the order dated 14.9.2001 the appellant filed an appeal which was dismissed as withdrawn on 1.11.2001. He filed a fresh objection on 8.11.2001 before the Executing Court which was rejected on 5.7.2002. Against that order he filed a First Appeal before the Rent Control Tribunal which was dismissed on 20.7.2002. Against the order of the Rent Control Tribunal he filed a Second Appeal before the Delhi High Court which was dismissed on 10.9.2002 by the impugned judgment. Thereafter he filed the present appeal before us.
It was submitted before us by the learned counsel for the appellant that the eviction decree was in respect of the second floor of the property in question, and possession of the second floor had been handed over to the landlord in pursuance of the eviction decree, but the third floor was an independent premises for which no order of eviction had been passed.
The High Court has dealt with this aspect and has observed that some unauthorized construction had been made by the appellant on the open area above the second floor of premises no.13/46, Scindia House, New Delhi and this unauthorized construction cannot be said to be an independent flat.
Before the Rent Control Tribunal it had been submitted by the appellant that the premises which is still in his possession is flat no.14A which is not a part of premises no.13/46, Scindia House, New Delhi. However, this plea had been negatived by the order of the Rent Control Tribunal dated 20.7.2002 after a detailed discussion. It was observed in the said order that flat no.14A is a part of the tenanted premises and not a separate accommodation. The High Court in the impugned judgment has observed that this is a question of fact and cannot be gone into in Second Appeal. We agree with this view taken by the High Court.
It is evident that frivolous objections have been filed in the execution case which is an abuse of the process of the Court and a flagrant violation of the eviction decree against the appellant against which Appeals had been rejected and even SLP in this Court was dismissed.
It is evident that after the first round of litigation was over the tenant started a second round of litigation on frivolous grounds which were a flagrant abuse of the Court. This is a practice which has become widespread, and which the Court cannot approve off, otherwise no judgment will ever attain finality.
Hence, we dismiss this appeal and impose a cost of Rs.10,000/- (Rupees Ten Thousand only) on the appellant which shall be paid to the respondent within two months from today. The appellant shall also hand over the premises in question, which is in his possession, to the landlord within three months from today failing which he will be evicted by police force.
...............................J.
(Markandey Katju)
...............................J.
(H.L. Dattu)
New Delhi;
April 30, 2009
CIVIL APPEAL NO. 6954 OF 2003
Sardar Estates -vs- Atma Ram Properties (P) Ltd
ORDER
This appeal furnishes a typical instance of a widespread malady which has infected the judicial system in the country, namely, the flagrant abuse of the process of the Court.
The respondent, which is the owner and landlord of premises no.13/46, Scindia House, Connaught Circus, New Delhi filed an eviction petition against the appellant, who is the tenant, before the Rent Controller, Delhi in 1981. That petition was decreed on 12.5.1993 on the ground of subletting. The appellant filed an appeal before the Rent Control Tribunal which was dismissed on 22.9.1998. Thereafter he filed a second appeal which was dismissed by the Delhi High Court on 31.1.2000. Against that order he filed an SLP in this Court which was dismissed as withdrawn by order dated 8.12.2000. He then filed a Review Petition before the Delhi High Court which was dismissed on 9.2.2001. Against that order the appellant filed another SLP in this Court which was dismissed on 9.4.2001. By that order he was directed to vacate the premises and handed over physical possession to the landlord on or before 31.10.2001 subject to the usual undertaking to be filed within four weeks. However, the appellant did not file the undertaking.
In execution proceedings the appellant filed an objection on 16.3.2001 which was rejected by the Executing Court on 14.9.2001. Against the order dated 14.9.2001 the appellant filed an appeal which was dismissed as withdrawn on 1.11.2001. He filed a fresh objection on 8.11.2001 before the Executing Court which was rejected on 5.7.2002. Against that order he filed a First Appeal before the Rent Control Tribunal which was dismissed on 20.7.2002. Against the order of the Rent Control Tribunal he filed a Second Appeal before the Delhi High Court which was dismissed on 10.9.2002 by the impugned judgment. Thereafter he filed the present appeal before us.
It was submitted before us by the learned counsel for the appellant that the eviction decree was in respect of the second floor of the property in question, and possession of the second floor had been handed over to the landlord in pursuance of the eviction decree, but the third floor was an independent premises for which no order of eviction had been passed.
The High Court has dealt with this aspect and has observed that some unauthorized construction had been made by the appellant on the open area above the second floor of premises no.13/46, Scindia House, New Delhi and this unauthorized construction cannot be said to be an independent flat.
Before the Rent Control Tribunal it had been submitted by the appellant that the premises which is still in his possession is flat no.14A which is not a part of premises no.13/46, Scindia House, New Delhi. However, this plea had been negatived by the order of the Rent Control Tribunal dated 20.7.2002 after a detailed discussion. It was observed in the said order that flat no.14A is a part of the tenanted premises and not a separate accommodation. The High Court in the impugned judgment has observed that this is a question of fact and cannot be gone into in Second Appeal. We agree with this view taken by the High Court.
It is evident that frivolous objections have been filed in the execution case which is an abuse of the process of the Court and a flagrant violation of the eviction decree against the appellant against which Appeals had been rejected and even SLP in this Court was dismissed.
It is evident that after the first round of litigation was over the tenant started a second round of litigation on frivolous grounds which were a flagrant abuse of the Court. This is a practice which has become widespread, and which the Court cannot approve off, otherwise no judgment will ever attain finality.
Hence, we dismiss this appeal and impose a cost of Rs.10,000/- (Rupees Ten Thousand only) on the appellant which shall be paid to the respondent within two months from today. The appellant shall also hand over the premises in question, which is in his possession, to the landlord within three months from today failing which he will be evicted by police force.
...............................J.
(Markandey Katju)
...............................J.
(H.L. Dattu)
New Delhi;
April 30, 2009
Monday, June 1, 2009
all the ingredients of commission of an offence U/s 138 NI Act must be satisfied.
CRIMINAL APPEAL NO. 913 OF 2009 [Arising out of SLP (Crl.) No. 8059 of 2007]
Raj Kumar Khurana Versus State of (NCT of Delhi) and Anr.
Whether return of a cheque by the bank on the ground that it was reported lost by the drawer would attract the penal provisions contained in Section 138 of the Negotiable Instruments Act, 1881 (for short “the Act”)
A bare perusal of the section 138 of N. I. Act would clearly go to show that by reason thereof a legal fiction has been created. A legal fiction, as is well known, although is required to be given full effect, has its own limitations. It cannot be taken recourse to for any purpose other than the one mentioned in the statute itself.
The court must be satisfied that all the ingredients of commission of an offence under the said provision have been complied with.
The parameters for invoking the provisions of Section 138 of the Act, thus, being limited, we are of the opinion that refusal on the part of the bank to honour the cheque would not bring the matter within the mischief of the provisions of Section 138 of the Act.
Raj Kumar Khurana Versus State of (NCT of Delhi) and Anr.
Whether return of a cheque by the bank on the ground that it was reported lost by the drawer would attract the penal provisions contained in Section 138 of the Negotiable Instruments Act, 1881 (for short “the Act”)
A bare perusal of the section 138 of N. I. Act would clearly go to show that by reason thereof a legal fiction has been created. A legal fiction, as is well known, although is required to be given full effect, has its own limitations. It cannot be taken recourse to for any purpose other than the one mentioned in the statute itself.
The court must be satisfied that all the ingredients of commission of an offence under the said provision have been complied with.
The parameters for invoking the provisions of Section 138 of the Act, thus, being limited, we are of the opinion that refusal on the part of the bank to honour the cheque would not bring the matter within the mischief of the provisions of Section 138 of the Act.