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DATE: September 29, 2015 (Date of pronouncement)
DATE: September 29, 2015 (Date of publication)
AY: 2015-16
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CITATION:
As the CBDT delayed issued the Income-tax Return Forms, the due date for filing the returns is extended to 31.10.2015. CBDT directed to issue an appropriate order u/s 119

In view of the above, taking the totality of facts and circumstances of the case, it is considered appropriate to extend the due date for e-filing of returns upto 31st October 2015 for which the CBDT shall issue appropriate notification/instructions under Section 119 of the Act. Direction is also issued to the respondents to ensure that the forms etc. which are to be prescribed for the audit report and for e-filing the returns should ordinarily be made available on the first day of April of the assessment year

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DATE: July 29, 2015 (Date of pronouncement)
DATE: September 28, 2015 (Date of publication)
AY: -
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CITATION:
Entire law on the taxation of deceased persons and their estate explained in the context of the Income-tax Act and the Central Excise Act

The individual assessee has ordinarily to be a living person and there can be no assessment on a dead person and the assessment is a charge in respect of the income of the previous year and not a charge in respect of the income of the year of assessment as measured by the income of the previous year. Wallace Brothers & Co. Ltd. v Commissioner of Income-tax. By section 24B of the Income-tax Act the legal representatives have, by fiction of law, become assessees as provided in that section but that fiction cannot be extended beyond the object for which it was enacted

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DATE: September 21, 2015 (Date of pronouncement)
DATE: September 28, 2015 (Date of publication)
AY: 1977-78 to 1986-87
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CITATION:
Important principles relating to valuation of property subject to the Land Ceiling Act explained in the context of the Wealth-tax Act

One has to assume that the property in question is saleable in the open market and estimate the price which the assumed willing purchaser would pay for such a property. When the asset is under the clutches of the Ceiling Act and in respect of the said asset/vacant land, the Competent Authority under the Ceiling Act had already determined the maximum compensation of Rs.2 lakhs, how much price such a property would fetch if sold in the open market? We have to keep in mind what a reasonably assumed buyer would pay for such a property if he were to buy the same. Such a property which is going to be taken over by the Government and is awaiting notification under Section 10 of the Act for this purpose, would not fetch more than Rs.2 lakhs as the assumed buyer knows that the moment this property is taken over by the Government, he will receive the compensation of Rs.2 lakhs only. We are not oblivious of those categories of buyers who may buy “disputed properties” by taking risks with the hope that legal proceedings may ultimately be decided in favour of the assessee and in such a eventuality they are going to get much higher value. However, as stated above, hypothetical presumptions of such sales are to be discarded as we have to keep in mind the conduct of a reasonable person and “ordinary way” of the presumptuous sale. When such a presumed buyer is not going to offer more than Rs.2 lakhs, obvious answer is that the estimated price which such asset would fetch if sold in the open market on the valuation date(s) would not be more than Rs.2 lakhs

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DATE: September 14, 2015 (Date of pronouncement)
DATE: September 28, 2015 (Date of publication)
AY: 2006-07
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CITATION:
S. 2(14)(iii)(b): To determine whether the “agricultural land” is situated within 8 km of the municipal limits so as to constitute a “capital asset”, the distance has to be measured in terms of the approach road and not by the straight line distance on horizontal plane or as per crow's flight

The Court is of the view that for the purposes of Section 2 (14) (iii) (b) of the Income-tax Act, the distance had to be measured from the agricultural land in question to the outer limit of the municipality by road and not by the straight line or the aerial route. The distance has to be measured from the land in question itself and not from the village in which the land is situated

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DATE: September 4, 2015 (Date of pronouncement)
DATE: September 16, 2015 (Date of publication)
AY: -
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S. 32: The "functional" test has to be applied to determine whether an asset is "plant". Even a pond designed for rearing prawns can be "plant"

In Commissioner of Income Tax vs. Anand Theatres 224 ITR 192 it was held that except in exceptional cases, the building in which the plant is situated must be distinguished from the plant and that, therefore, the assessee’s generating station building was not to be treated as a plant for the purposes of investment allowance. It is difficult to read the judgment in the case of Anand Theatres so broadly. The question before the court was whether a building that was used as a hotel or a cinema theatre could be given depreciation on the basis that it was a “plant” and it was in relation to that question that the court considered a host of authorities of this country and England and came to the conclusion that a building which was used as a hotel or cinema theatre could not be given depreciation on the basis that it was a plant

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DATE: September 8, 2015 (Date of pronouncement)
DATE: September 16, 2015 (Date of publication)
AY: 1999-00, 2000-01
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CITATION:
Law laid down in CIT Vs. Orient (Goa)(P) Ltd 325 ITR 554 that s. 172 is applicable only to non-residents carrying on shipping business and not to residents and that the expenditure of demurrage charges cannot be allowed u/s 40(a)(i) in the absence of TDS does not appear to be correct and issue is referred to Full Bench

We are unable to agree with the above view of this Court in Orient (Goa)(P) Ltd. (supra). This is for the reason that the assessee placed reliance upon Section 172 of the Act in respect of payments made by it to a non-resident shipping company by way of demurrage charges. The tax which is deducted at source by the assessee company is on behalf of the recipient of the charges. The issue before the Court was whether demurrage charges which are paid by the assessee to a non-resident company would be allowed as an expenditure in the absence of deduction of tax at source in view of Section 40(a)(i) of the Act

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DATE: September 9, 2015 (Date of pronouncement)
DATE: September 16, 2015 (Date of publication)
AY: 2008-08
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CITATION:
Circumstances in which gains from sale of shares can be assessed as short-term capital gains and not as business profits explained

On consideration of the above facts, the CIT (A) and Tribunal rightly concluded that compliance on the part of the assessee in terms of Instruction No.1827 dated 31 August 1989 issued by the Central Board of Direct Taxes laying down the tests for distinguishing the shares held in stock-in-trade and shares held as an investment, the shares held by the assessee was investment and held the income to be treated as short term capital gains

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DATE: September 11, 2015 (Date of pronouncement)
DATE: September 14, 2015 (Date of publication)
AY: 2007-08
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CITATION:
S. 54: To constitute purchase of new house, a registered sale deed is not necessary. Suspicion, howsoever strong, cannot partake the character of evidence

For the purpose of attracting the provisions of Section 54 of the IT Act, it is not necessary that the Assessee should become the owner of the property. Section 54 of the said Act speaks of purchase. Moreover, the ownership of the property may have different connotation in different statutes. It is wrong to hold that for the purpose of applicability of Section 54, registration of document is imperative

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DATE: September 2, 2015 (Date of pronouncement)
DATE: September 14, 2015 (Date of publication)
AY: 2008-09, 2009-10
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S. 10A/ 10B: If Tribunal upholds Revenue's plea that assessee is not entitled to S. 10B, it must consider the assessee's alternate plea for s. 10A deduction even if such alternate plea has not been raised before the lower authorities

A respondent in an appeal, if he has not filed a cross-appeal, is deemed to be satisfied with the decision. He is, therefore, entitled to support the judgment of the first officer on any ground but he is not entitled to raise a ground which will work adversely to the appellant. In fact such a ground may be a totally new ground, if it is purely one of law, and does not necessitate the recording of any evidence, even though the nature of the objection may be such that it is not only a defence to the appeal itself but goes further and may affect the validity of the entire proceedings. But the entertainment of such a ground would be subject to the restriction that even if it is accepted, it should be given effect to only for the purpose of sustaining the order in appeal and dismissing the appeal and cannot be made use of, to disturb or to set aside, the order in favour of the appellant

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DATE: September 10, 2015 (Date of pronouncement)
DATE: September 12, 2015 (Date of publication)
AY: 2009-10, 2011-12
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CITATION:
Even post insertion of proviso to s. 2 (15) but before 01.04.2016, s. 11 benefit cannot be denied to business activities carried by the trust in the course of actual carrying out of such advancement of any other object of general public utility. Trusts are entitled to carry out activities in the nature of trade, commerce or business etc as long as these activities are carried out in the course of actual carrying out of advancement of any other object of general public utility. On facts, activity of auctioning commercial plots for maximum revenue cannot be regarded as a profit-making exercise

This substitution of proviso to Section 2(15) may be viewed as representing a paradigm shift in the scope of the exclusion clause. The paradigm shift is this. So far as the scope of earlier provisos is concerned, the CBDT itself has, dealing with an assessee pursing “the advancement of any object of general pubic utility”, observed that “If such assessee is engaged in any activity in the nature of trade, commerce or business or renders any service in connection to trade, commerce or business, it would not be entitled to claim that its object is for charitable purposes” because “In such a case, the object of ‘general public utility’ will only be a mask or a device to hide the true purpose which is trade, commerce, or business or rendering of any service in relation to trade, commerce or business.” The advancement of any objects of general public utility and engagement in trade, commerce and business etc. were thus seen as mutually exclusive in the sense that either the assessee was pursuing the objects of general public utility or pursuing trade, commerce or business etc. in the garb of pursing the objects of general public utility

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