Month: April 2011

Archive for April, 2011


Shantilal M. Jain vs. ACIT (ITAT Mumbai)

COURT:
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SECTION(S):
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COUNSEL:
DATE: (Date of pronouncement)
DATE: April 29, 2011 (Date of publication)
AY:
FILE: Click here to view full post with file download link
CITATION:

Though it is the case of the revenue that due to volume, magnitude, frequency, continuity, regularity, the ratio between purchase and sale clearly indicate that income on account of purchase and sale of shares should be treated as income from business and not as income from STCG, the AO has, from AY 2003-04 to 2008-09 (except for the impugned year 2006-07), consistently accepted the income as being STCG. In these circumstances, the Rule of consistency as propounded by the Bombay High Court in Gopal Purohit 228 CTR 582 (Bom) is squarely applicable and the income has to be treated as STCG.

Posted in All Judgements, Tribunal

ITO vs. United Marine Academy (ITAT Mumbai – Special Bench)

COURT:
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DATE: (Date of pronouncement)
DATE: April 28, 2011 (Date of publication)
AY:
FILE: Click here to view full post with file download link
CITATION:

There are two deeming fictions created in s. 50 and s. 50C for computing capital gains on building. While s. 50 modifies the “cost of acquisition” for purposes of s. 48, s. 50C modifies the term “full value of the consideration received or accruing as a result of transfer of the capital asset”. The two deeming fictions operate in different fields and there is no conflict between them. As s. 50C was inserted to prevent assessee’s indulging in under-valuation, there is no logic why it should not be applied to a depreciable building

Posted in All Judgements, Tribunal

DHL Express (India) Pvt Ltd vs. ACIT (ITAT Mumbai)

COURT:
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SECTION(S):
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COUNSEL:
DATE: (Date of pronouncement)
DATE: April 28, 2011 (Date of publication)
AY:
FILE: Click here to view full post with file download link
CITATION:

Transfer Pricing: Low T/O companies are not comparable. Only operational profits to be considered for comparison The assessee, a courier company, made payments to its parent company towards net work fees, reimbursement of expenses, purchase of marketing material etc. In

Posted in All Judgements, Tribunal

Godrej Industries Ltd vs. DCIT (ITAT Mumbai)

COURT:
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SECTION(S):
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COUNSEL:
DATE: (Date of pronouncement)
DATE: April 27, 2011 (Date of publication)
AY:
FILE: Click here to view full post with file download link
CITATION:

The AO’s argument that the assessee could have utilized its surplus funds for repaying the borrowings instead of investing in shares and by not doing so, there was diversion of borrowed funds towards investment in shares to earn dividend income is not acceptable in view of CIT vs. Hero Cycles Ltd 323 ITR 518 (P&H) where Abhishek Industries was distinguished and it was held disallowance u/s 14A of interest on borrowed funds was not permissible if the investment in shares was made out of own funds

Posted in All Judgements, Tribunal

Renu Hingorani vs. ACIT (ITAT Mumbai)

COURT:
CORAM:
SECTION(S):
GENRE:
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COUNSEL:
DATE: (Date of pronouncement)
DATE: April 26, 2011 (Date of publication)
AY:
FILE: Click here to view full post with file download link
CITATION:

The AO had not questioned the actual consideration received by the assessee but the addition was made purely on the basis of the deeming provisions of s. 50C. The AO had not doubted the agreement or given any finding that the actual sale consideration was more than the sale consideration stated in the sale agreement. The fact that the assessee agreed to the addition is not conclusive proof that the sale consideration as per agreement was incorrect and wrong. Accordingly, there was no concealment of income or furnishing inaccurate particulars of income

Posted in All Judgements, Tribunal

Ruchi Strips & Alloys Ltd vs. DCIT (ITAT Mumbai)

COURT:
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SECTION(S):
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COUNSEL:
DATE: (Date of pronouncement)
DATE: April 26, 2011 (Date of publication)
AY:
FILE: Click here to view full post with file download link
CITATION:

The concealment of income had its repercussions only when the assessment was done under the normal procedure. If the assessment as per the normal procedure was not acted upon and it was the deemed income assessed u/s 115JB which became the basis of assessment, the concealment had no role to play and was totally irrelevant. The concealment did not lead to tax evasion at all

Posted in All Judgements, Tribunal

Raj Ratan Palace Co-op Hsg Soc vs. DCIT (ITAT Mumbai)

COURT:
CORAM:
SECTION(S):
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COUNSEL:
DATE: (Date of pronouncement)
DATE: April 26, 2011 (Date of publication)
AY:
FILE: Click here to view full post with file download link
CITATION:

The assessee-society had merely given permission to the developer to construct on the society’s land. No part of the land was ever transferred by the society. The Society continued to be the owner of the land and no change in ownership of land had taken place. Mere grant of consent will not amount to transfer of land/or any rights therein. The amount of Rs. 3.02 crores received by the members (on which some of them had paid tax) was not assessable in the assessee’s hands either u/s 2(24) or as capital gains

Posted in All Judgements, Tribunal

Areva T&D vs. ADIT (Delhi High Court)

COURT:
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COUNSEL:
DATE: (Date of pronouncement)
DATE: April 26, 2011 (Date of publication)
AY:
FILE: Click here to view full post with file download link
CITATION:

It is well settled that orders passed u/s 195(2) and 197 are provisional and tentative. These orders do not bind the AO in regular assessment proceedings. and do not preempt the Department from passing appropriate orders of assessment. The fact that a determination u/s 195 & 197 is an “order” subject to challenge u/s 264 does not make any difference

Posted in All Judgements, High Court

DIT vs. Maersk Co Ltd as agent of Mr. Henning Skov (Utt High Court – Full Bench)

COURT:
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DATE: (Date of pronouncement)
DATE: April 20, 2011 (Date of publication)
AY:
FILE: Click here to view full post with file download link
CITATION:

U/s 208, an employee is not liable to pay advance tax on salary because u/s 192 there is an obligation on the employer to deduct tax at source. The employee cannot foresee that the tax deductible under a statutory duty imposed upon the employer would not be so deducted. The employee proceeds on the assumption that the deduction of tax at source has statutorily been made or would be made and a certificate to that effect would be issued to him. If the employer fails to deduct tax at source, the employee becomes liable to pay the tax directly. However, the liability to pay interest remains upon the person responsible to deduct the tax at source. The department is entitled to proceed against the employer u/s 201(1A). (Sedco Forex 264 ITR 320 (Utt) & other judgements followed)

Posted in All Judgements, High Court

M/s Shree Balaji Alloys vs. CIT (J&K High Court)

COURT:
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DATE: (Date of pronouncement)
DATE: April 19, 2011 (Date of publication)
AY:
FILE: Click here to view full post with file download link
CITATION:

The ratio of Sahney Steel 228 ITR 253 (SC), Ponni Sugars 306 ITA 392 (SC) and Mepco Industries 319 ITR 208 (SC) is that to determine whether incentives & subsidies are revenue or capital receipts, the purpose underlying the incentives is the determinative test. If the object of the subsidy scheme is to enable the assessee to run the business more profitably then the receipt is on revenue account. On the other hand, if the object of the subsidy scheme is to enable the assessee to set up a new unit or to expand the existing unit then the receipt of the subsidy was on capital account. It is the object for which the subsidy/assistance is given which determines the nature of the incentive subsidy. The form or the mechanism through which the subsidy is given is irrelevant

Posted in All Judgements, High Court
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