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Section 14A & Rule 8D: Analysis Of Recent Important Judgements

CAs Ketan Ved and Rubal Arora have systematically tabulated the recent important decisions on the various contentious issues arising under section 14A and Rule 8D. The key takeaways from the judgements are given. The analysis will prove invaluable as a ready reckoner on the subject

Section 14A of the Income-tax Act, 1961 [Act] was introduced by the Finance Act, 2001 with retrospective effect from 01 April 1962, to provide for disallowance of expenditure incurred / deemed to have been incurred in relation to income not chargeable to tax.
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Are We Doing Injustice With Ourselves While Getting Justice For Others?

CA Prarthana Jalan has issued the timely warning that professionals get so obsessed with their professional duties, that they do not even realize that they are neglecting their own well-being and that of their families. She urges everyone to maintain a healthy work-life balance lest we face health and emotional problems later in life

Just a few days back, somebody asked me “what are your working hours”?

To this question with curved eyebrows I started with “10-6, no actually 9.30 to 7 or sometimes beyond or early to that, depends upon the work” and eventually the correct answer that I was able to arrive at was surprisingly from the time I get up in the morning till the time I am asleep in the night.

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The Law On Taxability Of Loan Waivers Explained

Sashank Dundu

Advocate Sashank Dundu has systematically analyzed all the recent judgements of the Supreme Court and High Courts on the controversial question as to whether benefits arising from waiver of loans constitute a capital or revenue receipt. He has also provided a clear-cut explanation of the interplay between sections 41(1), 28(iv) and 56(2)(x) on the taxability of such benefits

Waiver of Loan – Capital or Revenue – Benefit or Perquisite – Whether the law is settled?

1. Introduction:

1.1 Recently the Supreme Court in the case of Mahindra and Mahindra Ltd. [2018] 93 32 (SC), laid down the law that waiver of loan shall not be taxable either u/s 28(iv) or s.41(1). The law has been laid down in respect of two sections under the Income-tax Act as follows :

• As per the requirement of s.28(iv), the value of any benefit or perquisite, whether convertible into money or not, arising from business or the exercise of a profession. It clearly mentions that such benefit can be in any form, which can also be convertible into money. However, it should not be money. The Apex court has now clarified that ‘waiver of loan’ should be treated as ‘receipt of money’ and hence such receipt of money would fall outside the purview of s.28(iv) and accordingly cannot be taxable.

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Digest Of 900 Important Judgments On Transfer Pricing, International Tax And Domestic Tax (Jan To March 2018)


Advocate Sunil Moti Lala (assisted by CA Tushar Hathiramani and CA Bhavya Sundesha) has prepared a Digest of 900 important judgments on Transfer pricing (245 cases), International Tax (55 cases) and Domestic Tax (600 cases) pronounced in the period January 2018 to March 2018. The author has meticulously and systematically classified the judgments into various categories to enable ease of reference. A PDF copy of the Digest is available for download. He has also given the appeal numbers in all cases so as to enable the judgements to be retrieved from the
website of the respective Court or Tribunal. The digest will prove invaluable to all practitioners of taxation law

The Digest comprises of all the important judgements dealing with transfer pricing, international taxes and domestic taxation laws. A brief head note is given for each case. The Digests for the earlier periods are available here

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Section 2(22)(e) Of The Income-tax Act, 1961 – Last Word Yet To Be Said

FCA Prakash Agarwal has analyzed all the recent judgements on the controversial issue as to what is a “shareholder” so as to attract the provisions of section 2(22)(e) of the Income-tax Act relating to taxation of “deemed dividends”. He points out that there is yet no clarity as to whether the expression means a “registered” shareholder or a “beneficial” shareholder. The author has provided his own opinion on the subject as well

Two recent judgements of the Apex Court have kept the pot boiling with regard to the meaning of word ‘shareholder’ appearing in section 2(22)(e). Though, everyone had assumed that the controversy and litigation in the matter had ended with the disposal of a large number of appeals from various High Courts decided by the Apex Court on 05.10.2017 upholding the decisions of the High Courts, a few well known ones were by the name of Madhur Housing, Ankitech, Caparo etc.

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E-Assessment: Electronic Communication Of Notices Under The Income-tax Act


CA Vinay Kawdia has explained the legal framework for communication of statutory notices and orders in the electronic format and drawn attention to all the relevant circulars and notifications issued by the CBDT. He has also highlighted the practical consequences of the move to communicate electronically and cautioned that it could expose taxpayers to unwanted harassment


As a part of Government’s initiative towards E-governance, Income-tax Department has brought digital transformation of its business processes to a significant extent through the Income-Tax Business Application (ITBA) project which provides an integrated platform to conduct various tax-proceedings electronically through the ‘e-Proceeding’ facility available on it. To facilitate this initiative CBDT has issued series of circulars on the subject matter in last 2 years, to note a few:

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GST Act: Power Of Police To Investigate Offenses

Ashok Saraf

Dr. Ashok Saraf, Senior Advocate, has deliberated upon the important question whether the police has power to investigate cognizable offences under the GST Act, 2017 (both Central as well as State) by taking resort to the provisions of section 4(2) of the Code of Criminal Procedure, 1973. All relevant statutory provisions and judicial pronouncements have been referred

An important question that arises for consideration after the enactment of the Goods and Services Tax (GST) Act, 2017 (both Central as well as State) is as to whether police can investigate a cognisable offence of evasion of tax under the GST Act by taking resort to Section 4(2) of the Code of Criminal Procedure (CrPC), 1973 and whether police has the power to conduct search and seizure in respect of a cognisable offence under the GST Act without specific power having been conferred on the police and/or the Bureau of Investigation which comes under the police department under the GST Act to investigate into any offence committed under the GST Act.

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Recording Of Satisfaction U/s 147 – SOP By CBDT


The CBDT has prescribed a Standard Operating Procedure (SOP) to be followed by AOs while issuing notices u/s 148 of the Income-tax Act, 1961 for reopening of assessments. The SOP is designed to ensure that the AO addresses issues such as ‘change of opinion’, ‘failure to disclose’ etc so as to make the reopening foolproof and immune to challenge by taxpayers. CA Vinay Kawdia has studied the SOP and suggested changes and additions thereto so as to ensure that the objectives of the CBDT are met


In view of the section 147 of the Income Tax Act [‘The Act’], if the AO has reason to believe that any income chargeable to tax has escaped assessment for any assessment year, he may, subject to the provisions of sections 148 to 153, assess or reassess such income and also any other income chargeable to tax which has escaped assessment and which comes to his notice subsequently in the course of the proceedings under this section, for the assessment year concerned. Before making the assessment, reassessment or recomputation under section 147, the AO shall serve on the assessee a notice u/s 148 in prescribed form.

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Guide To The Prohibition Of Benami Property Transactions Act

Advocate Dr. P. Daniel has conducted a systematic study of the Prohibition of Benami Property Transactions Act, 1988 as amended in 2016. Apart from referring to all the important statury provisions and judicial pronouncements on the subject, the author has answered FAQs which throw light on the precise legal consequences of the enactment


The problem of property held as Benami has been causing concern to the tax authorities for quite some time. The Select Committee on the Taxation Laws (Amendment) Bill, 1969 had also recommended that Government. should examine the existing law relating to Benami Transactions with a view to find out whether such transactions should be prohibited. Hence the Benami Transactions Prohibition Act was enacted in 1988. As there was various lacunae and shortcomings in the Act, a new Amendment Act was introduced renaming the Title as The Benami Transactions (Prohibition) Amendment Act, 2016.

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Penny Stocks: Capital Gains, Law & Practice


Advocate Paras S. Savla has explained the modus operandi used by unscrupulous taxpayers to launder their unaccounted black money with the aid of bogus capital gains from Penny Stocks. He has also explained the relevant statutory provisions and discussed all the important judgements on the point. He has, however, cautioned that all cases of capital gains from penny stocks cannot be branded by the authorities as bogus and offered advice on what precautions taxpayers should take to avoid being wrongly assessed to tax

Humans! We keep bringing new ideas and creations to simplify our lives and yet end up creating an intricate and complicated web which is anything but simple. We graduated from bartering to commerce and trading to make our lives easy and then to complicate the whole thing, we invented an abstract entity called “company” to limit our risk.

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