Search Results For: Dr. K. Shivram


M/s Shah Realtors vs. ACIT (ITAT Mumbai)

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DATE: May 25, 2018 (Date of pronouncement)
DATE: June 21, 2018 (Date of publication)
AY: 2012-13
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CITATION:
'On Money': The fact that the assessee has sold flats at an undervaluation does not mean that he has understated the consideration and earned undisclosed 'on money'. The mere presumption that excess price could have been charged is not a ground for coming to the conclusion that the assessee did charge a higher price. The burden of proving such understatement or concealment is on the Revenue (All important judgements considered)

The case law relied by Assessing Officer in ITO Vs Diamond Investment and Properties ITA No. 5537/M/2009 is not applicable on the facts of the present case. In case of Diamond Investment and Properties (supra), the flats were sold to the related parties was much lower than the price charged from the other parties. However, there is no allegation of related parties’ transaction in the present case. The coordinate bench of Tribunal Neelkamal Realtor & Erectors India (P0 Ltd (2013) 38 taxmann.com 195 held that when the assessee offered an explanation for charging lower price in respect of some of flats sold by it and Assessing Officer without controverting such explanation made addition to income of assessee by applying rate of another flat sold by it, Assessing Officer was not justified in his action. Similar view was taken by another bench of Tribunal in ACIT Vs Rustom Soil Sethna

All India Federation of Tax Practitioners vs. ITO (ITAT Mumbai)

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DATE: May 4, 2018 (Date of pronouncement)
DATE: May 18, 2018 (Date of publication)
AY: 2013-14
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CITATION:
Rule 45 of the Income Tax Rules which mandates compulsory e-filing of appeals before the CIT(A) w.e.f. 01.04.2016 is a procedural and technical requirement. It cannot defeat the statutory right of an assessee to file an appeal. An assessee who has filed the appeal in paper format should be permitted to make good the default and to file an appeal electronically

From the facts of the present case, we gathered that the assessee had already filed the appeal in paper form, however only the e-filing of appeal has not been done by the assessee and according to us, the same is only a technical consideration. The Supreme Court has reiterated that if in a given circumstances, the technical consideration and substantial Justice are pitted against each other, then in that eventuality the cause of substantial Justice deserves to be preferred and cannot be overshadowed or negatived by such technical considerations

DCIT vs. Ozoneland Agro Pvt. Ltd (ITAT Mumbai)

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DATE: May 2, 2018 (Date of pronouncement)
DATE: May 9, 2018 (Date of publication)
AY: 2013-14
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CITATION:
S. 56(2)(viib) Fair Market Value of shares transferred: Rule 11UA allows the assessee the right to adopt the method of his choice for valuing shares (DCF, NAV etc). The AO has no jurisdiction to insist that the assessee should adopt only a particular method for determining the value of the shares. AOs should not deviate from earlier years’ decisions without assigning any concrete and justifiable reasons. Tax determination cannot be left to whims and fancies of a person. It is a serious task and has to be accomplished in a disciplined manner. If an assessee has been allowed a certain concession in earlier year/(s) it cannot be withdrawn in subsequent years without plausible reasons

Section 56 allows the assessees to adopt one of the methods of their choice. But,the AO held that the assessee should have adopted only one method for determining the value of the shares.In our opinion,it was beyond the jurisdiction of the AO to insist upon a particular system, especially the Act allows to choose one of the two methods.Until and unless the legislature amends the provision of the Act and prescribes only one method for valuation of the shares,the assessees are free to adopt any one of the methods.

Amod Shivlal Shah vs. ACIT (ITAT Mumbai)

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DATE: February 23, 2018 (Date of pronouncement)
DATE: April 14, 2018 (Date of publication)
AY: 2006-07
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CITATION:
S. 133A: An admission of estimated income made during survey has no evidentiary value and is not binding on the assessee. The income has to be assessed as per the return of income and books of account. Hiralal Maganlal 97 TTJ Mum 377 distinguished. CBDT Circular No. 286/2/2003 (Inv.) II dated 10.03.2003 referred

The Hon’ble Supreme Court in the case of Pullangode Rubber Produce Co. Ltd. vs State of Kerala & Anr., 91 ITR 18 (SC) recognised the trite law that it was open to the assessee who made the admission to show that it was incorrect. As per the Hon’ble Supreme Court, it was imperative that in such a situation assessee ought to be given a proper opportunity to show the correct state of facts. In fact, in the case before the Hon’ble Supreme Court, assessee was attempting to show that the entries made by it in the account books did not disclose the correct state of facts. The Hon’ble Supreme Court recognised the right of the assessee to do so on the premise that it was open to the assessee who made the admission to show that the same was incorrect. In other words, as per the Hon’ble Supreme Court, the admission made on an anterior date, which was not based on correct state of facts, was not conclusive to hold the issue against the assessee

Kunal R. Gupta vs. ITO (ITAT Mumbai)

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DATE: February 28, 2018 (Date of pronouncement)
DATE: March 29, 2018 (Date of publication)
AY: 2012-13
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CITATION:
Family Arrangement: It is not necessary for the validity of a family arrangement that there must be existing legal claims & disputes between the family members. The possibility of future disputes is sufficient. Family settlements entered into bona fide to maintain peace and harmony in the family are valid and binding on the authorities

Though conflict of legal claims in present or in future is generally a condition for the validity of a family arrangement, it is not necessarily so. Even bona fide disputes, present or possible, which may not involve legal claims will suffice. Members of a joint Hindu family may, to maintain peace or to bring about harmony in the family, enter into such a family arrangement. If such an arrangement is entered into bona fide and the terms thereof are fair in the circumstances of a particular case, Courts will more readily give assent to such an arrangement than to avoid it

CIT vs. Bengal Finance & Investments Pvt. Ltd (Bombay High Court)

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DATE: February 10, 2015 (Date of pronouncement)
DATE: January 5, 2018 (Date of publication)
AY: 2007-08
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CITATION:
S. 14A/ 115JB: Amount disallowed u/s 14A of the Act cannot be added to arrive at book profit for purposes of section 115JB of the Act

The impugned order of the Tribunal followed its decision in M/s. Essar Teleholdings Ltd. v/s. DCIT in ITA No. 3850/Mum/2010 to held that an amount disallowed under Section 14A of the Act cannot be added to arrive at book profit for purposes of Section 115JB of the Act. The Revenue’s Appeal against the order of the Tribunal in M/s. Essar Teleholdings (supra) was dismissed by this Court in Income Tax Appeal No.438 of 2012 rendered on 7th August, 2014. In view of the above, question (b) does not raise any substantial question of law

DCIT vs. Yogen D. Sanghvi (ITAT Mumbai)

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DATE: November 1, 2017 (Date of pronouncement)
DATE: December 29, 2017 (Date of publication)
AY: 2010-11
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CITATION:
S. 23 House Property Income: Common Area Maintenance Charges and non-occupancy charges paid by the assessee to the Society are deductible from the rent while computing the 'Annual Letting Value' u/s 22

What s. 22 attempts to assess is the annual value of the property consisting of any building or land appurtenant thereto, of which the appellant is the owner,, and which has not been put to use for the purposes of its business or profession by it. The rent being charged by the appellant, if so, is only a surrogate measure of the said annual value. The expenditure on the aforesaid items, i.e., the salary (including bonus) to the maintenance staff of the facilities as electric motors, lift, caning, etc., as well as that on the electricity consumed in respect of any common area and the electric motors, is not attributable directly to the house property as such, but to its enjoyment by the tenants/users thereof

Mustansir I Tehsildar vs. ITO (ITAT Mumbai)

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DATE: December 18, 2017 (Date of pronouncement)
DATE: December 22, 2017 (Date of publication)
AY: 2013-14
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CITATION:
S. 54: Acquisition of new flat in an apartment under construction should be considered as a case of “Construction” and not “Purchase”. The date of commencement of construction is not relevant for purpose of s. 54. The fact that the construction may have commenced prior to the date of transfer of the old asset is irrelevant. If the construction is completed within 3 years from the date of transfer, the exemption is available

For the purpose of sec. 54 of the Act, we have to see whether the assessee has completed the construction within three years from the date of transfer of old asset. In the instant case, there is no dispute that the assessee took possession of the new flat within three years from the date of sale of old residential flat. Accordingly, we are of the view that the assessee has complied with the time limit prescribed u/s 54 of the Act. Since the amount invested in the new flat prior to the due date for furnishing return of income was more than the amount of capital gain, the requirements of depositing any money under capital gains account scheme does not arise in the instant case. Further, the Hon’ble High Court has held in the case of ITO Vs. K.C.Gopalan (2000)(162 CTR 0566) that there is no requirement that the sale proceeds realised on sale of old residential house alone should be utilised

Nilesh Janardan Thakur vs. ITO (ITAT Mumbai)

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DATE: November 17, 2017 (Date of pronouncement)
DATE: December 2, 2017 (Date of publication)
AY: 2008-09
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CITATION:
Taxability of Gifts u/s 56(2)(vi): A receipt cannot be taxed u/s 56(2)(vi) merely on conjecture or surmises. The AO has to prove beyond doubt that a particular receipt is taxable as income. Merely because the person who paid the amount does not initiate any action for recovery of money is not sufficient for making addition

The AO has observed in his assessment order that SPCL has not taken any action for recovery of the amount, even after lapse of three years from the date of payment. The AO further observed that though the assessee has procured various immovable properties in his personal name, the company has failed to initiate necessary proceedings to get the land procured in their name or return the money given to the assessee. No interest has been charged on money paid to the assessee. All these facts goes to prove undisputed fact that the transactions are not genuine, therefore, the AO opined that impugned amount is taxable under the provisions of section 56(2)(vi) of the Act. We do not find any merit in the findings of the A.O. for the reason that merely because the person, who paid the amount does not initiate any action for recovery of money should not be not a reason for making addition towards amount received as assessee’s income. The AO has to prove beyond doubt a particular receipt is taxable in the given circumstances within the meaning of the said provision

Late Shri Gordhandas S. Garodia vs. DCIT (ITAT Mumbai)

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DATE: November 1, 2017 (Date of pronouncement)
DATE: November 28, 2017 (Date of publication)
AY: 2010-11
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CITATION:
S. 45/ 48: The scheme of the Act is to assess real income and not hypothetical income. The word "accrue" in "full value of consideration received or accruing" in s. 45 means that the assessee has a legally enforceable right to receive the sum. An amount which is payable only on fulfillment of conditions does not create an enforceable right and has to be excluded while computing capital gains

The expression “full value of consideration received or accruing” would mean the amount actually received by the assessee or consideration which has accrued to the assessee. The expression “accrue” means a right acquired by the assessee to receive income. Unless, a debt due by somebody has been created in favour of assessee, it cannot be said that he has acquired a right to receive the income or that income has accrued to him. An amount can accrue to assessee if he acquires a legally enforceable right to receive it from the debtor. The entire purpose of the Income Tax Act, 1961 is to assess the real income of the assessee. Therefore, the Departmental Authorities cannot assess any hypothetical or notional income to tax

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