Search Results For: Madhur Agrawal


General Electoral Trust vs. ITO (Bombay High Court)

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DATE: July 20, 2016 (Date of pronouncement)
DATE: August 4, 2016 (Date of publication)
AY: 2008-09
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CITATION:
S. 147: S. 148 reopening notice issued to a private trust which received contributions of Rs. 6.58 crore on the ground that it has not obtained a PAN or filed a return of income is not valid. The AO cannot assume all receipts are income and issue the reopening notice

Mere non filing of return of income does not give jurisdiction to the Assessing Officer to re-open the assessment unless the person concerned has total income which is assessable under the Act exceeding maximum amount which is not chargeable to Income Tax. This is provided in Explanation 2 to Section 147 of the Act. This is for the reason that in terms of Section 139(1) of the Act the obligation to file a return of income is only when the total income of a person exceeds the maximum amount not chargeable to tax. So also the obligation to obtain PAN only arises on the income being in excess of the maximum amount not chargeable to tax. Therefore, non filing of return of income and/or not obtaining of PAN does not ipso facto give jurisdiction to reopen an assessment under Section 147/148 of the Act

Posted in All Judgements, High Court

DSP Investment Pvt. Ltd vs. ACIT (Bombay High Court)

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DATE: March 8, 2016 (Date of pronouncement)
DATE: April 20, 2016 (Date of publication)
AY: 2008-09
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CITATION:
S. 14A/ Rule 8D: Non-consideration by the ITAT of a judgement of the co-ordinate Bench makes the order a non-speaking one and breaches the principles of natural justice

In fact the impugned order of the Tribunal ought to have dealt with its decision in J. K. Investors (supra) and considered its applicability to the present facts. In view of the fact that the impugned order of the Tribunal does not deal with its decision in J. K. Investors (supra) relied upon by the assessee in support of its submission as recorded in the impugned order itself makes the impugned order a nonspeaking order and, therefore, in breach of principles of natural justice. The substantial question of law is answered in the affirmative i.e. in favour of the assessee and against the revenue

Posted in All Judgements, High Court

Khandelwal Laboratories Pvt. Ltd vs. DCIT (Bombay High Court)

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DATE: March 17, 2016 (Date of pronouncement)
DATE: March 28, 2016 (Date of publication)
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CITATION:
S. 220(6): Dept directed to redeposit moneys collected illegally by attachment of assessee’s bank account during pendency of stay application. A order passed on a stay application must give reasons for the refusal to stay the demand

Thus, any action to recover taxes adopting coercive means is not permissible till the petitioner’s application for stay under Section 220(6) of the Act is disposed of. Therefore, the action of the Assessing Officer in attaching the petitioners’ bank accounts under Section 226(3) of the Act as well as subsequent withdrawal of the attached amounts from the bank accounts is without jurisdiction and bad in law. The petitioners have a statutory right to its stay application being heard and disposed of before the Revenue can adopt any coercive proceedings on the basis of the Notice of demand under Section 156 of the Act issued to the assessee. This action on the part of the Assessing Officer, if permitted, would lead Section 220(6) of the Act becoming redundant. In the above view, the Notice under Section 226(3) of the Act issued by the Assessing Officer to the petitioners’ bankers are quashed and set aside. Further, the Assessing Officer is directed to deposit the amount of Rs.7,59,185 in HDFC Bank, Fort, Mumbai and Rs.34,265/in State Bank of India, Byculla, Mumbai within a period of one week from today

Posted in All Judgements, High Court

CIT vs. Binani Cement Ltd (Calcutta High Court)

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DATE: March 4, 2016 (Date of pronouncement)
DATE: March 25, 2016 (Date of publication)
AY: 2006-07
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CITATION:
S. 115JB: As the loss suffered on transfer of business was rightly debited to the P&L A/c as per AS 13, it cannot be added back to the Book Profits

The accounting standards laid down by the institute however provide for recognition of the profit or loss arising out of investment in the profit and loss account. Reference in this regard may be made to Clauses 21 and 25 of Accounting Standard 13. The disclosure made in the financial statements is in pursuance of the requirement of Clause- 25 quoted above and is also in pursuance of Clause 2(b) of Part II of Schedule VI to the Companies Act, 1956 which is not to be construed as any qualification indicating any inaccuracy in the accounts. There was, thus no mistake on the part of the assessee in debiting the loss to the profit and loss account. Once it is realized that the assessee had correctly debited the profit and loss account for the loss arising out of the transfer of investment division, there remains no difficulty in realizing that the CIT proceeded on a wrong premise which was responsible for exercise of jurisdiction under Section 263 which he would not have done if he had realized the correct position

Posted in All Judgements, High Court

ITO vs. Dr. Vasant J Rath Trust (ITAT Mumbai)

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DATE: February 29, 2016 (Date of pronouncement)
DATE: March 7, 2016 (Date of publication)
AY: 2005-06
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CITATION:
Entire law on difference between premium (salami) paid to acquire a lease and rent paid to use a lease explained in the context of whether a lease results in a transfer u.s 2(47)

By its nature the salami being a non-recurring payment -made by a tenant to the landlord at the inception of the grant of the lease has a/ways been regarded as a receipt of a capital nature in the hands of the landlord. The finding that had been recorded by the Tribunal was that this payment was made to the assessee by the tenants for getting them accepted as tenants. In other words, it was by way of a premium or salami that these payments were received by the assessee as a consideration for granting monthly tenancies to the tenants. Obviously, it was a non-recurring payment made by the tenants to the assessee for the purpose of getting the monthly tenancy. Every payment by way of a salami or a premium need not necessarily be held to be of a capital nature or on capital account, but since prima facie that is the nature of such payment it is for the department to establish facts which would go to show that such payment was in the – nature of income and not on capital account

Posted in All Judgements, Tribunal

HDFC Bank Ltd vs. DCIT (Bombay High Court)

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DATE: February 25, 2016 (Date of pronouncement)
DATE: March 3, 2016 (Date of publication)
AY: 2008-09
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CITATION:
S. 14A/ Rule 8D: Severe strictures passed against the ITAT for taking the view that the presumption laid down in HDFC Bank 366 ITR 505 (Bom) and Reliance Utilities 313 ITR 340 (Bom) that investments in tax-free securities must be deemed to have come out of own funds and (ii) Law laid down in India Advantage (Bom) that s. 14A and Rule 8D does not apply to securities held as stock-in-trade cannot be applied as both propositions are contrary to Godrej & Boyce 328 ITR 81 (Bom). ITAT's order reversed on the ground that it is "Judicial Indiscipline" leading to complete chaos and anarchy in the administration of law

The impugned order of the Tribunal seems to question the decision of this Court in HDFC Bank Ltd. (supra) to the extent it relied upon the decision of this Court in Reliance Utilities and Power Ltd. (supra). This is by observing that the decision in Reliance Utilities and Power Ltd.(supra) it must be appreciated was rendered in the context of Section 36(1)(iii) of the Act and its parameters are different from that of Section 14A of the Act. This Court in its order in HDFC Bank Ltd.(supra) consciously applied the principle of presumption as laid down in Reliance Utilities and Power Ltd. (supra) and in fact quoted the relevant paragraph to emphasize that the same principle / test of presumption would apply to decide whether or not interest expenditure could be disallowed under Section 14A of the Act in respect of the income arising out of tax free securities. It is not the office of Tribunal to disregard a binding decision of this court. This is particularly so when the decision in Reliance Utilities and Power Ltd. (supra) has been consciously applied by this Court while rendering a decision in the context of Section 14A of the Act

Posted in All Judgements, High Court

CIT v. Thyssen Krupp (Bombay High Court)

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DATE: December 2, 2015 (Date of pronouncement)
DATE: December 21, 2015 (Date of publication)
AY: 2007-08
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CITATION:
Transfer Pricing: An adjustment with respect to transfer pricing has to be confined to transactions with Associated Enterprises and cannot be made with respect to transactions with unrelated third parties

In terms of Chapter X of the Act, re-determination of the consideration is to be done only with regard to income arising from International Transactions on determination of ALP. The adjustment which is mandated is only in respect of International Transaction and not transactions entered into by assessee with independent unrelated third parties. This is particularly so as there is no issue of avoidance of tax requiring adjustment in the valuation in respect of transactions entered into with independent third parties. The adjustment as proposed by the Revenue if allowed would result in increasing the profit in respect of transactions entered into with non-AE. This adjustment is beyond the scope and ambit of Chapter X of the Act

Posted in All Judgements, High Court

DIT vs. Credit Agricole Indosuez (Bombay High Court) (No. 1)

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DATE: June 17, 2015 (Date of pronouncement)
DATE: July 29, 2015 (Date of publication)
AY: 1997-98
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CITATION:
Strictures passed regarding the "casual and callous" and "frivolous" manner in which senior officers of the dept authorize filing of appeals. Strictures also passed against counsel for acting as a "mouthpiece" of the Dept in persisting with unmeritorious appeals. CBDT directed to take appropriate action

Undoubtedly, an Advocate has to fearlessly put forth his client’s point of view, however the same has to be tempered /guided by truth and justice of the dispute. In matters of tax, justice requires that there must be certainty of law which presupposes equal application of law. Thus where the issue in controversy stands settled by decisions of this Court or the Tribunal in any other case and the Revenue has accepted that decision, then in that event the Revenue ought not to agitate the issue further unless there is some cogent justification such as change in law or some later decision of an higher forum etc

Posted in All Judgements, High Court

DIT vs. Credit Agricole Indosuez (Bombay High Court) (No. 2)

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DATE: June 17, 2015 (Date of pronouncement)
DATE: July 29, 2015 (Date of publication)
AY: 1997-98
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CITATION:
S. 244A: Interest on income-tax refund received by a non-resident is not effectively connected with the PE (Permanent Establishment) either on asset test or activity test. Accordingly such interest cannot be assessed as business profits but has to be assessed as "interest" under Article 11/ 12

Interest on income tax refund is not effectively connected with the PE (Permanent Establishment) either on asset test or activity test. Therefore, taxable under the Article 11(2) of Indo Netherlands tax treaty

Posted in All Judgements, High Court

Raptakos Brett & Co. Ltd vs. DCIT (ITAT Mumbai)

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DATE: June 10, 2015 (Date of pronouncement)
DATE: June 19, 2015 (Date of publication)
AY: 2007-08
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CITATION:
S. 10(38), 70(3): Though the LTCG on sale of equity shares (subject to STT) is exempt from tax u/s 10(38), the long-term capital loss on sale of such shares can be set-off against the taxable LTCG on sale of another asset

Section 10(38) excludes in expressed terms only the income arising from transfer of Long term capital asset being equity share or equity fund which is chargeable to STT and not entire source of income from capital gains arising from transfer of shares. It does not lead to exclusion of computation of capital gain of Long term capital asset or Short term capital asset being shares. Accordingly, Long term capital loss on sale of shares would be allowed to be set off against Long term capital gain on sale of land in accordance with section 70(3)

Posted in All Judgements, Tribunal