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DATE: August 11, 2020 (Date of pronouncement)
DATE: August 12, 2020 (Date of publication)
AY: -
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CITATION:
(i) S. 6 of the Hindu Succession Act, 1956 confers status of coparcener on daughters born before or after amendment in the same manner as son with the same rights and liabilities, (ii) The rights can be claimed by the daughter born earlier with effect from 9.9.2005 with savings as provided in Section 6(1) as to the disposition or alienation, partition or testamentary disposition which had taken place before 20th day of December, 2004, (iii) Since the right in coparcenary is by birth, it is not necessary that father coparcener should be living as on 9.9.2005 (Entire law on family settlements under Hindu Law (HUFs) explained)

The object of preventing, setting up of false or frivolous defence to set at naught the benefit emanating from amended provisions, has to be given full effect. Otherwise, it would become very easy to deprive the daughter of her rights as a coparcener. When such a defence is taken, the Court has to be very extremely careful in accepting the same, and only if very cogent, impeccable, and contemporaneous documentary evidence in shape of public documents in support are available, such a plea may be entertained, not otherwise. We reiterate that the plea of an oral partition or memorandum of partition, unregistered one can be manufactured at any point in time, without any contemporaneous public document needs rejection at all costs. We say so for exceptionally good cases where partition is proved conclusively and we caution the courts that the finding is not to be based on the preponderance of probabilities in view of provisions of gender justice and the rigor of very heavy burden of proof which meet intendment of Explanation to Section 6(5). It has to be remembered that courts cannot defeat the object of the beneficial provisions made by the Amendment Act

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DATE: March 5, 2020 (Date of pronouncement)
DATE: March 7, 2020 (Date of publication)
AY: 2008-09
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CITATION:
S. 153C: Compliance with the requirements of s. 153C is mandatory. (i) If the AO of the searched person is different from the AO of the other person, the AO of the searched person is required to transmit the satisfaction note & seized documents to the AO of the other person. He is also required to make a note in the file of the searched person that he has done so. However, the same is for administrative convenience and the failure by the AO of the searched person to make a note in the file of the searched person, will not vitiate the proceedings u/s 153C. (ii) If the AO of the searched person and the other person is the same, it is sufficient for the AO to note in the satisfaction note that the documents seized from the searched person belonged to the other person. Once the note says so, the requirement of s. 153C is fulfilled. In such case, there can be one satisfaction note prepared by the AO, as he himself is the AO of the searched person and also the AO of the other person. However, he must be conscious and satisfied that the documents seized/recovered from the searched person belonged to the other person. In such a situation, the satisfaction note would be qua the other person. The requirement of transmitting the documents so seized from the searched person would not be there as he himself will be the AO of the searched person and the other person and therefore there is no question of transmitting such seized documents to himself

This Court had an occasion to consider the scheme of Section 153C of the Act and the conditions precedent to be fulfilled/complied with before issuing notice under Section 153C of the Act in the case of Calcutta Knitwears (2014) 6 SCC 444 as well as by the Delhi High Court in the case of Pepsi Food Pvt. Ltd (367) ITR 112 (Delhi). As held, before issuing notice under Section 153C of the Act, the Assessing Officer of the searched person must be “satisfied” that, inter alia, any document seized or requisitioned “belongs to” a person other than the searched person. That thereafter, after recording such satisfaction by the Assessing Officer of the searched person, he may transmit the records/documents/things/papers etc. to the Assessing Officer having jurisdiction over such other person. After receipt of the aforesaid satisfaction and upon examination of such other documents relating to such other person, the jurisdictional Assessing Officer may proceed 7 to issue a notice for the purpose of completion of the assessment under Section 158BD of the Act and the other provisions of Chapter XIV-B shall apply.

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DATE: October 18, 2019 (Date of pronouncement)
DATE: October 19, 2019 (Date of publication)
AY: 2006-07
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CITATION:
S. 143(2): Mere mentioning of new address in the return of income is not enough. If change of address is not specifically intimated to the AO, he is justified in sending the notice at the address mentioned in PAN database. If the notice is sent within the period prescribed in s. 143(2), actual service of the notice upon the assessee is immaterial

It is required to be noted that notices under Section 143(2) of the 1961 Act are issued on selection of case generated under automated system of the Department which picks up the address of the assessee from the database of the PAN. Therefore, the change of address in the database of PAN is must, in case of change in the name of the company and/or any change in the registered office or the corporate office and the same has to be intimated to the Registrar of Companies in the prescribed format 12 (Form 18) and after completing with the said requirement, the assessee is required to approach the Department with the copy of the said document and the assessee is also required to make an application for change of address in the departmental database of PAN, which in the present case the assessee has failed to do so.

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DATE: May 9, 2019 (Date of pronouncement)
DATE: May 18, 2019 (Date of publication)
AY: -
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CITATION:
Benami Transactions: While considering whether a particular transaction is benami, the intention of the person who contributed the purchase money is determinative. The intention has to be decided on the basis of surrounding circumstances; relationship of parties; motives governing their action in bringing about the transaction and subsequent conduct. The payment of part sale consideration & stamp duty cannot be the sole criteria to hold the sale/transaction as benami

It is required to be noted that the benami transaction came to be amended in the year 2016. As per Section 3 of the Benami Transaction (Prohibition) Act 1988, there was a presumption that the transaction made in the name of the wife and children is for their benefit. By Benami Amendment Act,2016, Section 3 (2) of the Benami Transaction Act, 1988 the statutory presumption, which was rebuttable, has been omitted.It is the case on behalf of the respondents that therefore in view of omission of Section 3(2) of the Benami Transaction Act, the plea of statutory transaction that the purchase made in the name of wife or children is for their benefit would not be available in the present case. Aforesaid cannot be accepted. As held by this Court in the case of Binapani Paul (Supra) the Benami Transaction (Prohibition) Act would not be applicable retrospectively

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DATE: April 9, 2019 (Date of pronouncement)
DATE: April 13, 2019 (Date of publication)
AY: -
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CITATION:
Benami Transactions: In considering whether a particular transaction is benami, six circumstances can be taken as a guide: (1) source from which purchase money came; (2) nature and possession of property, after purchase; (3) motive, if any, for giving transaction a benami colour; (4) position of parties and relationship, if any, between claimant and alleged benamidar; (5) custody of title deeds after sale & (6) conduct of parties in dealing with the property after sale. Mere fact that financial assistance was given is not a determinative factor (All imp judgements referred)

It is well­ settled that the burden of proving that a particular sale is benami and the apparent purchaser is not the real owner, always rests on the person asserting it to be so. This burden has to be strictly discharged by adducing legal evidence of a definite character which would either directly prove the fact of benami or establish circumstances unerringly and reasonably raising an inference of that fact. The essence of a benami is the intention of the party or parties concerned; and not unoften, such intention is shrouded in a thick veil which cannot be easily pierced through. But such difficulties do not relieve the person asserting the transaction to be benami of any part of the serious onus that rests on him; nor justify the acceptance of mere conjectures or surmises, as a substitute for proof

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DATE: March 1, 2019 (Date of pronouncement)
DATE: April 6, 2019 (Date of publication)
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CITATION:
Articles 136, 141: Entire law on legal effect of dismissal of a Special Leave Petition (SLP) by a speaking/ non-speaking order explained. If the dismissal is by a speaking order & reasons are given, the same is a declaration of law which is binding under Article 141. The findings are also binding by way of judicial discipline. However, this does not mean that the order of the lower court has merged in the dismissal order of the Supreme Court

If the order refusing leave to appeal is a speaking order, i.e., gives reasons for refusing the grant of leave, then the order has two implications. Firstly, the statement of law contained in the order is a declaration of law by the Supreme Court within the meaning of Article 141 of the Constitution. Secondly, other than the declaration of law, whatever is stated in the order are the findings recorded by the Supreme Court which would bind the parties thereto and also the court, tribunal or authority in any proceedings subsequent thereto by way of judicial discipline, the Supreme Court being the Apex Court of the country. But, this does not amount to saying that the order of the court, tribunal or authority below has stood merged in the order of the Supreme Court rejecting the special leave petition or that the order of the Supreme Court is the only order binding as res judicata in subsequent proceedings between the parties

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DATE: March 5, 2019 (Date of pronouncement)
DATE: March 9, 2019 (Date of publication)
AY: -
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CITATION:
S. 37(1)/40A(2) Business expenditure vs. sharing of profit: The AO has to take into account the manner in which the business works, the modalities and manner in which SAP/additional purchase price/final price are decided and determine what amount forms part of the profit. Whatever is the profit component is sharing of profit/distribution of profit and the rest is deductible as expenditure

Merely because the higher price is paid to both, members and non-members, qua the members, still the question would remain with respect to the distribution of profit/sharing of the profit. So far as the non-members are concerned, the same can be dealt with and/or considered applying Section 40A (2) of the Act, i.e., the assessing officer on the material on record has to determine whether the amount paid is excessive or unreasonable or not

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DATE: March 1, 2019 (Date of pronouncement)
DATE: March 7, 2019 (Date of publication)
AY: 1979-80, 1980-81
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CITATION:
S. 80-HH/ 80-I/ 80-AB: There is a difference between 'income' referred to in s. 80-AB and 'profits & gains' referred in s. 80-HH/80-I. Deduction u/s 80-HH/ 80-I has to be computed on the ‘profits and gains’, without deducting therefrom ‘depreciation’ and ‘investment allowance’ & not from ‘income’ as computed under the Act. S. 80AB is prospective. Motilal Pesticides 243 ITR 26 (SC) reversed

Reading of Section 80HH along with Section 80A would clearly signify that such a deduction has to be of gross profits and gains, i.e., before computing the income as specified in Sections 30 to 43D of the Act. It is correctly pointed out by Division Bench in the reference order that in Motilal Pesticides case, the Court followed the judgment rendered in the M/s. Cloth Traders (P) Ltd. which was a case under Section 80M of the Act, on the premise that language of Section 80HH and Section 80M is the same. This basis is clearly incorrect as the language of two provisions is materially different. We are, therefore, of the considered opinion that judgment of Motilal Pesticides is erroneous. We, therefore, overrule this judgment.

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DATE: February 20, 2019 (Date of pronouncement)
DATE: February 22, 2019 (Date of publication)
AY: -
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CITATION:
S. 80-IC: An assessee availing exemption of 100% tax on setting up of a new industry, which is admissible for 5 years, and either on the expiry of 5 years or thereafter (but within 10 years) from the date when these assessees started availing exemption, they carried out substantial expansion of its industry, from that year the assessees become entitled to claim exemption @ 100% again (Classic Binding Industries 407 ITR 429 held not good law and reversed)

We have no hesitation to accept this mistake which occurred in Commissioner of Income Tax vs. M/s. Classic Binding Industries 407 ITR 429. The Court specifically dealt with ‘initial assessment year’ and came into conclusion that there cannot be two initial assessment years within a span of 10 years which is the maximum period for allowing deduction as per sub-section (6) of Section 80-IC. As the issue directly concerned with initial assessment year, its definition contained in that very Section was missed out. To that extent, there is an error in the judgment dated 20th August, 2018 in Classic Binding Industries case

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DATE: January 25, 2017 (Date of pronouncement)
DATE: August 4, 2017 (Date of publication)
AY: -
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CITATION:
For purposes of filing a rectification application, the period of limitation of six months commences from the date of receipt of the order sought to be rectified by the assessee and not from the date of passing of the order

The second part of the Section requires that the Tribunal shall make such amendments if the mistake is brought to its notice by either party to the appeal before it. The party to the appeal can bring the fact of apparent mistake on record only after going through the order made by the tribunal. Therefore, to read that the period of limitation has to computed at any time within six months from the date of the order does not fit in either with legislative intent or the language employed by the provision.

15. There is another angle from which the matter can be approached. It is only the party to the appeal who finds that the order contains a mistake apparent from the record and is aggrieved by such mistake, would be in a position to move an application seeking rectification of the order. Therefore also, unless and until a party to the appeal is in a position to go through and study the order it would not be possible, nor can it be envisaged, that a party can claim to be aggrieved by the mistake apparent from the record. Hence, even on this count the period of limitation has to be read and understood so as to mean from the date of the receipt of the order

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