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DATE: March 29, 2016 (Date of pronouncement)
DATE: March 31, 2016 (Date of publication)
AY: 2005-06
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S. 9(1)(vii)/ 40(a)(ia)/ 194J: “Technical services” & “Managerial and Consultancy service” denotes services that cater to special & exclusive needs of the consumer/user. A "facility", even if termed as a service, which is available to all users, does not come within the ambit of “technical services” in Explanation 2 of s. 9(1)(vii)

“Technical services” like “Managerial and Consultancy service” would denote seeking of services to cater to the special needs of the consumer/user as may be felt necessary and the making of the same available by the service provider. It is the above feature that would distinguish/identify a service provided from a facility offered. While the former is special and exclusive to the seeker of the service, the latter, even if termed as a service, is available to all and would therefore stand out in distinction to the former. The service provided by the Stock Exchange for which transaction charges are paid fails to satisfy the aforesaid test of specialized, exclusive and individual requirement of the user or consumer who may approach the service provider for such assistance/service. It is only service of the above kind that, according to us, should come within the ambit of the expression “technical services” appearing in Explanation 2 of Section 9(1)(vii) of the Act. In the absence of the above distinguishing feature, service, though rendered, would be mere in the nature of a facility offered or available which would not be covered by the aforesaid provision of the Act

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DATE: March 9, 2016 (Date of pronouncement)
DATE: March 12, 2016 (Date of publication)
AY: 2004-05
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S. 80-IB(4): Subsidies (such as transport subsidy, Interest subsidy and power subsidy) paid to the assessee with the object of reducing the cost of production constitutes "profits derived from the business of the industrial undertaking" and is eligible for deduction u/s 80-IB. Liberty India 317 ITR 218 (SC) is distinguishable on facts

In Liberty India v. Commissioner of Income Tax 317 ITR 218 (SC)/ 2009 (9) SCC 328, what this Court was concerned with was an export incentive, which is very far removed from reimbursement of an element of cost. A DEPB drawback scheme is not related to the business of an industrial undertaking for manufacturing or selling its products. DEPB entitlement arises only when the undertaking goes on to export the said product, that is after it manufactures or produces the same. Pithily put, if there is no export, there is no DEPB entitlement, and therefore its relation to manufacture of a product and/or sale within India is not proximate or direct but is one step removed. Also, the object behind DEPB entitlement, as has been held by this Court, is to neutralize the incidence of customs duty payment on the import content of the export product which is provided for by credit to customs duty against the export product. In such a scenario, it cannot be said that such duty exemption scheme is derived from profits and gains made by the industrial undertaking or business itself

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DATE: February 9, 2016 (Date of pronouncement)
DATE: March 7, 2016 (Date of publication)
AY: 1997-98
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Reopening of assessment: If no assessment order is passed, there cannot be a notice for re-assessment inasmuch as the question of re-assessment arises only when there is an assessment in the first instance

The ratio of the judgment in Trustees of H.E.H. The Nizam’s Supplemental Family Trust v. CIT [2000]242 ITR 381 SC is that in those situations where there is no assessment order passed, there cannot be a notice for re-assessment inasmuch as the question of re-assessment arises only when there is an assessment in the first instance

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DATE: February 18, 2016 (Date of pronouncement)
DATE: March 1, 2016 (Date of publication)
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S. 80HHC: Sale proceeds of scrap cannot be included in total turnover

The issue in these appeals pertains to the question whether the proceeds generated from the sale of scrap would be included in the total turnover. In the recent decision of this Court in Commissioner of Income Tax Vs. Punjab Stainless Steel Industries & Ors. reported in [2014] 364 ITR 144 (SC) it has been held that sale proceeds generated from the sale of scrap would not be included in the total turnover for the purpose of deduction under Section 80HHC of the Income Tax Act, 1961

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DATE: February 16, 2016 (Date of pronouncement)
DATE: February 22, 2016 (Date of publication)
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S. 12AA: Non disposal of an application for registration before the expiry of six months as provided u/s 12AA (2) results in deemed grant of registration

The short issue is with regard to the deemed registration of an application under Section 12AA of the Income Tax Act. The High Court has taken the view that once an application is made under the said provision and in case the same is not responded to within six months, it would be taken that the application is registered under the provision

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DATE: October 16, 2015 (Date of pronouncement)
DATE: February 16, 2016 (Date of publication)
AY: -
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Law on prospective vs. retrospective operation of legislation explained. The Hindu Succession (Amendment Act), 2005 which came into effect on 09.09.2015 and by which daughters in a joint Hindu family, governed by Mitakshara law, were granted statutory right in the coparcenary property (being property not partitioned or alienated) of their fathers applies only if both the father and the daughter are alive on the date of commencement of the Amendment Act

An amendment of a substantive provision is always prospective unless either expressly or by necessary intendment it is retrospective3. In the present case, there is neither any express provision for giving retrospective effect to the amended provision nor necessary intendment to that effect. Requirement of partition being registered can have no application to statutory notional partition on opening of succession as per unamended provision, having regard to nature of such partition which is by operation of law. The intent and effect of the Amendment will be considered a little later. On this finding, the view of the High Court cannot be sustained. Interpretation of a provision depends on the text and the context (RBI vs. Peerless (1987) 1 SCC 424, para 33). Normal rule is to read the words of a statute in ordinary sense. In case of ambiguity, rational meaning has to be given (Kehar Singh vs. State (1988) 3 SCC 609). In case of apparent conflict, harmonious meaning to advance the object and intention of legislature has to be given (District Mining Officer vs. Tata Iron and Steel Co. (2001) 7 SCC 358)

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DATE: December 10, 2015 (Date of pronouncement)
DATE: January 29, 2016 (Date of publication)
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Controversy on whether s. 80-1A(9) mandates that the amount of profits allowed as deduction u/s 80-1A(1) has to be reduced from the profits of the business of the undertaking while computing deduction under any another provisions under heading C in Chapter VI-A of the Income-tax Act, 1961 referred to larger Bench

While Hon’ble Mr. Justice Anil R. Dave took the view that the judgement of the Delhi High Court in Great Eastern Exports v. Commissioner of Income-Tax2 [2011] 332 ITR 14 (Delhi) lays down the correct position in law and allowed the appeals of the Revenue, Hon’ble Mr. Justice Dipak Misra dissented and held that the law laid down by the Bombay High Court had in Associated Capsules Private Limited v. Deputy Commissioner of Income Tax and another [2011] 332 ITR 42 (Bom) lays down the correct position in law and dismissed the appeals of the Revenue. In view of difference of opinion, the matters have been referred to a larger Bench

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DATE: January 7, 2016 (Date of pronouncement)
DATE: January 25, 2016 (Date of publication)
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S. 271C: Penalty for failure to deduct TDS cannot be levied if Dept is unable to show contumacious conduct on the part of the assessee

We have carefully considered the rival submissions. In the instant case we are not dealing with collection of tax u/s 201(1) or compensatory interest u/s 201(1A). The case of the assessee is that these amounts have already been paid so as to end dispute with Revenue. In the present appeals we are concerned with levy of penalty u/s 271-C for which it is necessary to establish that there was contumacious conduct on the part of the assessee. We find that on similar facts Hon’ble Delhi High Court have deleted levy of penalty u/s 271-C in the cae of M/s. Itochu Corporation, reported in 268 ITR 172 (Del) and in the case of CIT Vs. Mitsui & Company Ltd. Reported in 272 ITR 545

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DATE: January 18, 2016 (Date of pronouncement)
DATE: January 25, 2016 (Date of publication)
AY: 1984-85
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S. 256: While findings of fact found by the Tribunal are final and the High Court cannot reappraise the same, the High Court can take note of facts on record which are lost sight of by the Tribunal and also construe certain facts to be of significance as against the different view of the Tribunal

It is well settled that issues of fact determined by the Tribunal are final and the High Court in exercise of its reference jurisdiction should not act as an appellate Court to review such findings of fact arrived at by the Tribunal by a process of reappreciation and reappraisal of the evidence on record. The aforesaid position in law has been consistently laid down by this Court in several of its pronouncements out of which, illustratively, reference may be made to Karnani Properties Ltd. Vs. Commissioner of Income-Tax, West Bengal [82 ITR 547], Rameshwar Prasad Bagla vs. Commissioner of Income-Tax, U.P. [87 ITR 421], Commissioner of Income-Tax, Bombay City vs. Greaves Cotton and Co. Ltd. [68 ITR 200] and K. Ravindranathan Nair vs. Commissioner of Income-Tax [247 ITR 178]

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DATE: November 24, 2015 (Date of pronouncement)
DATE: November 29, 2015 (Date of publication)
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S. 3 of Indian Evidence Act: A "Compact Disc" (CD) is a "document" and is admissible as evidence

In view of the definition of ‘document’ in Evidence Act, and the law laid down by this Court, as discussed above, we hold that the compact disc is also a document. It is not necessary for the court to obtain admission or denial on a document under sub-section (1) to Section 294 CrPC personally from the accused or complainant or the witness. The endorsement of admission or denial made by the counsel for defence, on the document filed by the prosecution or on the application/report with which same is filed, is sufficient compliance of Section 294 CrPC

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