Month: April 2008

Archive for April, 2008


CIT vs. Arthusa Offshore (Uttarakhand High Court)

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DATE: (Date of pronouncement)
DATE: April 23, 2008 (Date of publication)
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FILE: Click here to view full post with file download link
CITATION:

The word “tax”in Articles 14(2) and 2(1)(b) of the India-USA DTAA includes “surcharge” and for purposes of Article 14(2) which provides that the rate of tax payable by a USA company shall not exceed 15% of the rate payable by domestic companies, the surcharge payable by domestic companies has to be included.

Posted in All Judgements, High Court

Development Consultants vs. DCIT (ITAT Kolkata)

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DATE: (Date of pronouncement)
DATE: April 23, 2008 (Date of publication)
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Where the assessee entered into “international transactions” with “associated enterprises” and the AO made adjustments to the arms length price, held, deleting the adjustments that:

(i) In order to determine the most appropriate method for determining the arm’s length price, it is first necessary to select the ‘tested party’ and the tested party will be the least complex of the controlled taxpayer and will not own valuable intangible property or unique assets that distinguish it from potential uncontrolled comparables.

Posted in All Judgements, Tribunal

Malayala Manorama vs. CIT (Supreme Court)

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DATE: (Date of pronouncement)
DATE: April 18, 2008 (Date of publication)
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CITATION:

The AO has no jurisdiction u/s 115J of the Act to go behind the Profit & loss account of the assessee and to make adjustments therein beyond what is expressly provided in s. 115J. An assessee is entitled to provide for depreciation in its books at rates which are higher than the rates specified in Schedule XIV to the Companies Act.

Posted in All Judgements, Supreme Court

Sahara India vs. CIT (Supreme Court) (Larger Bench)

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DATE: (Date of pronouncement)
DATE: April 18, 2008 (Date of publication)
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CITATION:

Before dubbing the accounts to be complex or difficult to understand, there has to be a genuine and honest attempt on the part of the AO to understand accounts maintained by the assessee; appreciate the entries made therein and in the event of any doubt, seek explanation from the assessee. The opinion must be based on objective criteria and not on the basis of subjective satisfaction. Recourse to s. 142 (2A) cannot be had by the AO merely to shift his responsibility of scrutinizing the accounts of an assessee and pass on the buck to the special auditor.

Posted in All Judgements, Supreme Court

Pradip Mehta vs. CIT (Supreme Court)

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DATE: (Date of pronouncement)
DATE: April 12, 2008 (Date of publication)
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CITATION:

U/s 6 (6), a person will become an ordinarily resident only if (a) he has been residing in nine out of ten preceding years; and (b) he has been in India for at least 730 days in the previous seven years;

Posted in All Judgements, Supreme Court

Sudarshan Silks vs. CIT (Supreme Court)

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DATE: (Date of pronouncement)
DATE: April 12, 2008 (Date of publication)
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CITATION:

The Tribunal deleted penalty on the finding that the assessee had been induced to offer undisclosed income on the assurance that penalty would not be levied. The frame of the question raised by the department in its appeal to the High Court did not challenge the perversity of the finding. However, the High Court still held that the finding was perverse. Held: the Tribunal is the final fact- finding authority and its decision on the facts can be gone into by the High Court only if a question has been referred to it which says that the finding of the Tribunal on facts is perverse, in the sense that it is such as could not reasonably have been arrived at on the material placed before the Tribunal. In the absence of such a question having been claimed, the High Court was obliged to accept the findings of fact arrived at by the Tribunal and then proceed to decide the question of law referred to it.

Posted in All Judgements, Supreme Court

CIT vs. Lazor Syntex & CIT vs. Akshay Textiles Trading (Bombay High Court)

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DATE: (Date of pronouncement)
DATE: April 9, 2008 (Date of publication)
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FILE: Click here to view full post with file download link
CITATION:

In McDowell 154 ITR 148, the Court nowhere said that every action or inaction on the part of the tax payer which results in reduction of tax liability to which he may be subjected to in the future, is to be viewed with suspicion and be treated as a device for avoidance of tax irrespective of legitimacy or genuineness of the act.

Posted in All Judgements, High Court

CIT vs. Scindia HUF (Bombay High Court)

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DATE: (Date of pronouncement)
DATE: April 9, 2008 (Date of publication)
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FILE: Click here to view full post with file download link
CITATION:

The issue of notice under s. 16 (2) W. T. Act {s. 143 (2) I. T. Act} is mandatory for reassessment proceedings. If notice u/s 16 (2) {143 (2)} is not issued, the assessment order passed u/s 17 {s. 147} is not valid.

Posted in All Judgements, High Court

New Delhi Auto vs. JCIT (Delhi High Court)

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DATE: (Date of pronouncement)
DATE: April 9, 2008 (Date of publication)
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FILE: Click here to view full post with file download link
CITATION:

The consequences arising out of invoking Chapter XIV-B of the Act are drastic and draconian. The accounts of the assessee may be re-opened for ten years and not only a legal presumption is raised against the assessee but the burden shifts on the assessee to show that it did not have any undisclosed income. Under these circumstances the Revenue should not exercise its powers in a mechanical power but should be circumspect while taking action under the provisions of Chapter XIV-B of the Act.Where the ‘satisfaction’ recorded by the AO u/s 158 BD was vague and lacking material particulars, held the proceedings were bad-in-law.

Posted in All Judgements, High Court

DCIT vs. NITS Softech (ITAT Delhi)

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DATE: (Date of pronouncement)
DATE: April 9, 2008 (Date of publication)
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FILE: Click here to view full post with file download link
CITATION:

Where a notice issued u/s 158BD was vague, showed non-application of mind on the part of the issuing authority and had been issued in a casual manner, held it did not meet the requirements of law and the resultant assessment

Posted in All Judgements, Tribunal
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