Home › › Page 82

Search Results For: Domestic Tax

This section is now closed. Click here for new judgements


Posted on by editor — 3 Comments ↓
COURT:
CORAM: ,
SECTION(S): ,
GENRE:
CATCH WORDS:
COUNSEL:
DATE: September 16, 2016 (Date of pronouncement)
DATE: November 12, 2016 (Date of publication)
AY: 2005-06 to 2008-09
FILE: Click here to view full post with file download link
CITATION:
The pre-amended Explanation 5A to s. 271(1)(c) applies to non-filer assessees where a ROI is not filed before search and undisclosed income is not offered in the ROI. The amended provision of Explanation 5A, which is applicable to both filers and non-filers of returns, does not apply to searches conducted pre 13.08.2009. Penalty levied u/s 271(1)(c) to cases which are covered by s. 271AAA is void

The provisions of explanation 5A to section 271(1)(c) as it stood as on the date of search or filing of the return u/s 153A of the Act, is important to reckon whether the deeming fiction provided in the said provisions is applicable or not. The pre-amended provisions of explanation 5A is applicable to a non filer assessees, where the assessee’s is not filed return of income before the search and also not disclosed the undisclosed income in the return of income. The amended provision of explanation 5A, which is brought into the statute by the Finance Act 2009, (which was received ascent of President on 13.8.2009) is applicable to both filers and non-filers of returns. In the present case on hand, the law applicable as on the date of search, which was pre-amended provisions of explanation 5A, as per which no penalty can be leviable, in case the assessee has filed return of income u/s 139(1) of the Act before the date of search, whether or not undisclosed income is disclosed in the said return. Admittedly in this case, the search is taken place on 16.11.2007. The assessee has filed return of income u/s 1534 of the Act u/s 30.1.2009

Read more ›

Posted on by editor — 1 Comment ↓
COURT:
CORAM: ,
SECTION(S):
GENRE:
CATCH WORDS: ,
COUNSEL:
DATE: October 21, 2016 (Date of pronouncement)
DATE: November 12, 2016 (Date of publication)
AY: 2011-12
FILE: Click here to view full post with file download link
CITATION:
S. 35(2AB): The AO is bound to grant deduction if the R&D facility is approved by the competent authority. He has no jurisdiction in sit in judgement over the approval. The fact that the competent authority did not file the report with the department as prescribed is a technical lapse for which the assessee is not liable.

Once, the R&D facility is approved by the competent authority and assessee has complied with the prescribed rules, the A.O. is bound to allow the deductions claimed u/s 35(2AB) of the Act, if he is satisfied that the assessee’s facility is approved by the competent authority. In case the A.O. is having any doubt with regard to the goods manufactured by the assessee or expenditure claimed, the A.O. is bound to refer the matter back to the competent authority through appropriate authority i.e. the Central Board of Direct Taxes (CBDT) and seek clarifications. Thus, it would emerge from above analysis that neither the A.O. nor the board was competent to take any decision of any such controversy relating to report and approval granted by the prescribed authority as it involved expert view or opinion. It was prescribed authority alone which would be competent to take decision with regard to the correctness or otherwise and its order of approval granted in form no.3CL as prescribed u/s 35(2AB) of the Act read with rule 7A of the Income Tax Rules, 1962. In the present case on hand, on perusal of the facts available on record, we find that the A.O. without following the procedure laid down under rules, simply disallowed the expenditure claimed by the assessee by holding that the goods manufactured by the assessee are mere office machines and apparatus listed in Eleventh schedule. Therefore, we are of the view that the A.O. is not correct in disallowing the claim made by the assessee u/s 35(2AB) of the Act

Read more ›

Posted on by editor — 1 Comment ↓
COURT:
CORAM: ,
SECTION(S):
GENRE:
CATCH WORDS: ,
COUNSEL:
DATE: October 21, 2016 (Date of pronouncement)
DATE: November 8, 2016 (Date of publication)
AY: -
FILE: Click here to view full post with file download link
CITATION:
Strictures: Department's recalcitrance to release the assessee's seized jewellery, even though it is so small as to constitute "stridhan" and even though no addition was sustained in the assessee's hands, is not "mere inaction" but is one of "deliberate harassment"

This court is of opinion that the respondent’s recalcitrance is not mere inaction; it is one of deliberate harassment. Unarguably, the first round of assessment proceedings culminated in no addition of the jewellery or its value in the hands of the petitioner’s husband. The matter ought to have rested there, because the further proceedings were at the behest of the petitioner’s husband who was aggrieved by the additions made (and not aggrieved by the decision on issues in his favour). The ITAT’s decision to proceed de novo, nevertheless strengthened the respondents’ obduracy and hardened their resolve not to release the jewellery. The de novo order did not result in any addition on that aspect at all; still the respondents cling to another ingenious argument- that till the petitioners’ husband’s tax demands are satisfied, they can detain the jewellery

Read more ›

Posted on by editor — No Comments ↓
COURT:
CORAM:
SECTION(S):
GENRE:
CATCH WORDS: ,
COUNSEL:
DATE: September 2, 2016 (Date of pronouncement)
DATE: November 7, 2016 (Date of publication)
AY: -
FILE: Click here to view full post with file download link
CITATION:
S. 279(2) Compounding of offenses: The fact that the assessee has been convicted of an offense does not mean that the application for compounding of the offense is not maintainable. Under the guidelines, the competent authority has to examine the merits of the case and decide whether there is a case for compounding. There are no fetters on the powers of the competent authority under the guidelines. An appeal filed against a conviction is a "proceeding" for s. 279(2).

The power of compounding is exercisable when proceedings are pending. In the case on hand, the sentence imposed on the petitioner has been suspended by the Appellate Court and the appeal is still pending. Therefore, it has to be seen as to whether that conviction by the Criminal Court should be the only reason for rejecting the petitioner’s application for compounding the offence. Clause 4.4 of the guidelines states that cases not to be compounded. It commences with a non obstante clause stating that notwithstanding anything contained in the guidelines, the category of cases mentioned in clauses (a) to (g) should normally not be compounded. Thus, the guidelines does not specifically place an embargo on the competent authority to consider the application for compounding merely on the ground when the assessee has been convicted by a court of law

Read more ›

Posted on by editor — No Comments ↓
COURT:
CORAM: ,
SECTION(S): ,
GENRE:
CATCH WORDS: , , ,
COUNSEL:
DATE: September 30, 2016 (Date of pronouncement)
DATE: November 7, 2016 (Date of publication)
AY: 2002-03 to 2007-08
FILE: Click here to view full post with file download link
CITATION:
S. 153C: An order u/s 153C passed without obtaining the approval of the JCIT u/s 153D is without jurisdiction and void in view of Calcutta Knitwears 362 ITR 673 (SC) and CBDT Circular No. 24/15 dated 31.12.2015

The guidelines of the Hon’ble Supreme Court as referred to in para 2 above, with regard to recording of satisfaction note may be brought to the notice of all for strict compliance. It is further clarified that even if the AO of the searched person and the “other person” is one and the same then also he is required to record his satisfaction as has been held by the Courts. In view of the above, filing of appeals on the issue of recording of satisfaction note should also be decided in the light of the above judgment. Accordingly, the Board hereby directs that pending litigation with regard to recording of satisfaction note under section 158BD/153C should be withdrawn/not pressed if it does not meet the guidelines laid down by the Apex Court.

Read more ›

Posted on by editor — No Comments ↓
COURT:
CORAM: ,
SECTION(S): ,
GENRE:
CATCH WORDS: , ,
COUNSEL:
DATE: December 5, 2015 (Date of pronouncement)
DATE: November 1, 2016 (Date of publication)
AY: 2009-10
FILE: Click here to view full post with file download link
CITATION:
S. 10A/10B: After the change in scheme from “exemption” to “deduction” w.e.f. 01.04.2001, brought forward unabsorbed loss & depreciation of other 10B units and non-10B units are not liable for set off against the current year's profit of the 10B unit. The contrary law laid down in Himatasingike Seide 156 Taxman 151 (Kar), as approved by the Supreme Court, deals with the law pre 01.04.2001 when s. 10A/10B provided for an “exemption” and not a “deduction”

We find that the decision of the Karnataka High Court in Himatasingike Seide Ltd. (supra) which was undisturbed by the Apex Court was in respect of Assessment Year 1994-95. Thus it dealt with the provisions of Section 10B of the Act as existing prior to 1 April 2001 which was admittedly different from Section 10B as in force during Assessment Year 2009-10 involved in this appeal. Section 10B of the Act as existing prior to 1 April 2001 provided for an exemption in respect of profits and gains derived from export by 100% Export Oriented Undertakings and now it provides for deduction of profits and gains derived from a 100% Exported Oriented Units

Read more ›

Posted on by editor — No Comments ↓
COURT:
CORAM: ,
SECTION(S): ,
GENRE:
CATCH WORDS: ,
COUNSEL:
DATE: October 5, 2016 (Date of pronouncement)
DATE: November 1, 2016 (Date of publication)
AY: 1997-98
FILE: Click here to view full post with file download link
CITATION:
S. 147: Even if the claim for s. 80-IA deduction is contrary to Pandian Chemicals 262 ITR 278 (SC) and Liberty India 317 ITR 218 (SC), the assessment cannot be reopened (beyond 4 years) in the absence of tangible material. The reasons recorded for the reopening cannot be improved or supplemented later

The rationale furnished by the revenue in its counter affidavit and reiterated in the court during the hearing was that a component of income which was otherwise inadmissible but escaped the notice of the AO, because of the ratio in Liberty India and Pandian (supra) is unpersuasive. Besides, the lack of any reference to objective material, cannot in any way improve the case of the revenue – much less its reference to otherwise binding judgments that could have been the basis of a valid revision by the revenue under Section 264. It goes without saying that statutory orders containing reasons are to be judged on the basis of what is apparent and not what is explained later, as the validity of those orders does not improve with time or on account of better explanations furnished in the course of legal proceedings (refer M.S. Gill and Anr. vs. Chief Election Commissioner AIR 1978 SC 581)

Read more ›

Posted on by editor — No Comments ↓
COURT:
CORAM: ,
SECTION(S): , ,
GENRE:
CATCH WORDS: ,
COUNSEL:
DATE: September 22, 2016 (Date of pronouncement)
DATE: November 1, 2016 (Date of publication)
AY: 2008-09
FILE: Click here to view full post with file download link
CITATION:
S. 45/48: In valuing the shares of a privately held co, the “enterprise valuation” has to be taken by valuing even the assets held by subsidiaries of the Company. It is common for the sellers to charge a “controlling premium” for the sale of the shares. Such transfers to enable restructuring and re-aligning the shareholding pattern are genuine and bona fide. The alleged excess consideration for the sale of the shares cannot be treated as “unexplained income”

The exit from the closely held company BEC Industrial Investment Company Private limited with its subsidiaries could in commercial parlance definitely command premium in addition to the normal price based on NAV as first of all the valuation of the subsidiary would get embedded in the price of share of BEC Industrial Investment company Private Limited and that valuation has to be done based on present value of enterprise and not necessarily the book value as represented by financial statements and also controlling premium is embedded in the price for the shares paid by acquiring shareholders to the selling shareholder group to vest/strengthen their control in the BEC Industrial Investment Private Limited which shall get embedded in mutually agreed negotiated price between the buyer and the seller

Read more ›

Posted on by editor — 3 Comments ↓
COURT:
CORAM: ,
SECTION(S):
GENRE:
CATCH WORDS: ,
COUNSEL:
DATE: September 14, 2016 (Date of pronouncement)
DATE: October 21, 2016 (Date of publication)
AY: -
FILE: Click here to view full post with file download link
CITATION:
Attitude of the Revenue in not returning seized assets despite assessee having succeeded in appeal is clearly arbitrary and shows an attitude of undue harassment to the assessee in the garb of public Revenue. Interest of public revenue does not authorize Revenue Authorities to work without any authority and create or cause all kinds of harassment to innocent people on the pretext of statutory authority

Aforesaid attitude on the part of respondents is clearly arbitrary and shows an attitude of undue harassment to petitioner in the garb of public Revenue. Interest of public revenue does not authorize Revenue Authorities to work without any authority and create or cause all kinds of harassment to innocent people on the pretext of statutory authority, Revenue Authorities cannot claim liberty/privilege so as to deprive an individual, his property and that too in a manner, which has been found quite unreasonable and wholly without jurisdiction

Read more ›

Posted on by editor — No Comments ↓
COURT:
CORAM: ,
SECTION(S): ,
GENRE:
CATCH WORDS: ,
COUNSEL:
DATE: September 23, 2016 (Date of pronouncement)
DATE: October 21, 2016 (Date of publication)
AY: 2013-14
FILE: Click here to view full post with file download link
CITATION:
S. 234E: Entire law on whether fee for late filing of TDS returns can be levied prior to 01.06.2015 and whether the intimation issued u/s 200A is appealable explained

It is clear that the prescribed authority has been vested with the power to charge fees under section 234E of the Act only with regard to levy of fees by the substitution made by Finance (No.2) Act, 2015 w.e.f. 01.06.2015. Once the power has been given, under which any levy has to be imposed upon tax payer, then such power comes into effect from the date of substitution and cannot be applied retrospectively. The said exercise of power has been provided by the statute to be from 01.06.2015 and hence, is to be applied prospectively. There is no merit in the claim of Revenue that even without insertion of clause (c) under section 200A(1) of the Act, it was incumbent upon the assessee to pay fees, in case there is default in furnishing the statement of tax deducted at source. Admittedly, the onus was upon the assessee to prepare statements and deliver the same within prescribed time before the prescribed authority, but the power to collect the fees by the prescribed authority vested in such authority only by way of substitution of clause (c) to section 200A(1) of the Act by the Finance Act, 2015 w.e.f. 01.06.2015. Prior to said substation, the Assessing Officer had no authority to charge the fees under section 234E of the Act while issuing intimation under section 200A of the Act. Before exercising the authority of charging any sum from any deductor or the assessee, the prescribed authority should have necessary power vested in it and before vesting of such power, no order can be passed by the prescribed authority in charging of such fees under section 234E of the Act, while exercising jurisdiction under section 200A of the Act. Thus, in the absence of enabling provisions, under which the prescribed authority is empowered to charge the fees, the Assessing Officer while processing the returns filed by the deductor in respect of tax deducted at source can raise the demand on account of taxes, if any, not deposited and charge interest. However, prior to 01.06.2015, the Assessing Officer does not have the power to charge fees under section 234E of the Act while processing TDS returns. In the absence of enabling provisions, levy of fees could not be effected in the course of intimation issued under section 200A of the Act prior to 01.06.2015

Read more ›