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DATE: June 21, 2018 (Date of pronouncement)
DATE: September 19, 2018 (Date of publication)
AY: -
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CITATION:
Strictures against CA for certifying bogus accounts with a view to mislead bankers. The matter is typical of how business is conducted in this country and why loans obtained from banks remain unpaid. The ITAT may only be faulted for not reporting the CA to the ICAI for having apparently abetted in the commission of a colossal act of misrepresentation. ICAI directed to look into the matter and take necessary action

A rosy picture as to the financial position of the applicant seeking credit facilities from a bank would be presented before the bank for the bank to assess the creditworthiness of the applicant and the desirability of extending credit facilities to such applicant; but later another balance-sheet and profit and loss accounts would be slipped into the file, possibly indicating a less robust financial position of the constituent. If such was the object on the exercise, to which Roy Ghosh and Associates appear to have been a willing accomplice, the assessee has been appropriately dealt with by the fora below. The balance-sheet and profit and loss accounts of an assessee accompanied by a certificate as to its fairness, notwithstanding the caveat as noticed in paragraph 2(A) thereof, cannot be tailor-made to suit a particular purpose or window-dressed to make it attractive for bankers to rely thereupon and all the gloss and sheen removed thereafter when it was the time to pay tax

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DATE: June 21, 2018 (Date of pronouncement)
DATE: August 17, 2018 (Date of publication)
AY: -
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CITATION:
S. 37(1): Law on whether payment of a one-time fee to continue the business of mining constitutes capital expenditure or revenue expenditure explained with reference to R.B.Seth Moolchand Sugachand v CIT 86 ITR 647 (SC) and Bikaner Gypsums 187 ITR 39 (SC)

The distinction between the judgment in R.B. Seth Moolchand Sugachand and the judgment in Bikanker Gypsums Ltd is that in Bikaner Gypsums Ltd there was a pre-existing right and the expenditure was incurred not to assert a new right but to exercise a pre-existing right. In the present case, it is the same as in Bikaner Gypsums Ltd. since the mining licence was previously issued in favour of the assessee and the payment of the NPV did not extend the area of the assessee’s mining operations, it merely removed an impediment in the carrying on of the operations in terms of the original licence

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DATE: June 25, 2018 (Date of pronouncement)
DATE: August 4, 2018 (Date of publication)
AY: 2004-05
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S. 139/ 153: When search operations are conducted u/s 132, the obligation of the assessee to file any return remains suspended till such time that a notice is issued for such purpose u/s 153A(1)(a). If the return is filed within the reasonable time permitted by such notice u/s 153A(1)(a), the return is deemed to have been filed within the time permitted u/s 139 (1)/ 139(3) and loss can be carried forward

The non obstante clause at the beginning of Section 153A (1) of the Act suspends, for the purpose and to the extent as indicated in such provision, the operation of several other provisions of the Act, including Section 139 and even Section 147 in course of any reassessment. In other words, when a search is initiated under Section 132 of the Act, the assessee is not required to file the assessee’s return till such time that the assessee receives a notice under Section 153A(1)(a) thereof. Once such notice is received the liability fastens on the assessee to file the return within the reasonable time specified in the relevant notice

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DATE: June 27, 2018 (Date of pronouncement)
DATE: July 5, 2018 (Date of publication)
AY: -
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CITATION:
S. 68 Bogus share capital: If the alleged share applicants do not appear before the AO pursuant to the s. 131 summons and the documentation is inadequate, it is a "completely bogus claim". The assessee cannot argue that the AO should have made inquiries from the AO of the share applicants as to their credit-worthiness

The appellant-assessee has referred to a judgment of this Court reported at 114 ITR 689 for the proposition that upon the identity of the person who has put in the money being established by the assessee, the onus is on the Revenue to discredit the explanation offered in terms of Section 68 of the Act. In the present case, there was no plausible explanation that was furnished by the assessee. At any rate, the identities of the alleged share applicants could not be established and the documents of the alleged share applicants carried by the assessee before the Assessing Officer did not reveal the investments that the assessee claimed such alleged applicants had made in the assessee

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