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DATE: October 22, 2014 (Date of pronouncement)
DATE: October 24, 2014 (Date of publication)
AY: 2007-08
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Bogus purchases: Filing of confirmation of suppliers with PAN and TIN number are not sufficient to prove the purchases are genuine if they are not supported by other facts including delivery of goods & presence of suppliers

The department had gathered the information through survey and search seizure in above parties and they categorically admitted that they have provided entries and not doing any purchase and sale of gems and jewellery. Even then Assessing Officer asked to …

Anuj Kumar Varshney vs. ITO (ITAT Jaipur) Read More »

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DATE: October 17, 2014 (Date of pronouncement)
DATE: October 24, 2014 (Date of publication)
AY: 2006-07
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S. 147: The reasons must specifically indicate as to which material fact was not disclosed by the petitioner in the course of its original assessment

In the reasons supplied to the petitioner, there is no whisper, what to speak of any allegation, that the petitioner had failed to disclose fully and truly all material facts necessary for assessment and that because of this failure there …

Global Signal Cables (I) Pvt. Ltd vs. DCIT (Delhi High Court) Read More »

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DATE: October 22, 2014 (Date of pronouncement)
DATE: October 24, 2014 (Date of publication)
AY: 2008-09
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No S. 14A/ Rule 8D Disallowance if accounts not examined. Consent fee paid to SEBI is not penalty for infraction of law

Re Disallowance made u/s 14A r.w. rule 8D (i) It is now settled principle that the assessing officer has to examine the disallowance made by the assessee by having regard to the accounts of the assessee and only thereafter the …

ITO vs. Reliance Share and Stock Brokers (P) Ltd (ITAT Mumbai) Read More »

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DATE: October 21, 2014 (Date of pronouncement)
DATE: October 24, 2014 (Date of publication)
AY: 2006-07
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charter hire payment is not assessable as royalty, there is no obligation to deduct TDS and no disallowance u/s 40(a)(i) can be made

It is very clear that the payments made by the assessee company were in the nature of simple payments for chartering ships on hire for doing the business outside India. Therefore, the payments do not satisfy the test laid down …

Mathewsons Exports & Imports vs. ACIT (ITAT Cochin) Read More »

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DATE: October 21, 2014 (Date of pronouncement)
DATE: October 24, 2014 (Date of publication)
AY: 2009-10
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Rule 8D(ii) & 8D(iii) do not apply to shares held as stock-in-trade. Loss arising out of derivatives from the income arising out of buying and selling of shares

(i) Both trading of shares and derivative transactions are not coming under the purview of Section 43(5) of the Act which provides definition of “speculative transaction” exclusively for purposes of section 28 to 41 of the Act. Again, the fact …

DCIT vs. Baljit Securities Private Limited (ITAT Kolkata) Read More »

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DATE: October 21, 2014 (Date of pronouncement)
DATE: October 22, 2014 (Date of publication)
AY: 2007-08
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In a case of "sogo shosha" business model (high volume, low risk, trading of goods), the "berry ratio" (benchmarking gross profit and/ or net revenues (after subtraction of cost of sales) against operating expenses is an appropriate PLI. To avoid discrimination under Article 24(3) of the India-Japan DTAA, the benefit of no disallowance u/s 40(a)(ia) (in the cast of residents) for want of TDS if the recipient has paid the tax has to be extended to non-residents u/s 40(a)(i)

As regards the transfer pricing adjustment: (i) Even the TPO does not dispute that (a) MCI is a low risk activity in the field of trading, (b) MCJ group is primarily involved in high volume sales, or ‘colossal sales’ of …

Mitsubishi Corporation India Pvt. Ltd vs. DCIT (ITAT Delhi) Read More »

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DATE: October 17, 2014 (Date of pronouncement)
DATE: October 21, 2014 (Date of publication)
AY: 2005-06
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Expl 2 to S. 132B, though inserted w.e.f. 1.6.2013, is retrospective and seized cash cannot be adjusted against advance-tax liability

(i) As per provisions of section 132B of the Act the assets seized u/s 132 or requisitioned u/s 132A may be adjusted towards the amount of any “existing liability”. The Explanation 2 to section 132B of the Act inserted by …

DCIT vs. Spaze Tower Pvt. Ltd (ITAT Delhi) Read More »

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DATE: October 17, 2014 (Date of pronouncement)
DATE: October 21, 2014 (Date of publication)
AY: 2005-06
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S. 275(1A): Assessee's claim for refund of penalty with interest cannot be defeated by inaction of revenue

(i) What is provided by Section 275(1A) is that the order imposing or enhancing or reducing or cancelling the penalty may be passed on the basis of the assessment as revised by giving effect to the order in appeal. The …

Shanti Enterprise vs. ACIT (Gujarat High Court) Read More »

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DATE: October 17, 2014 (Date of pronouncement)
DATE: October 21, 2014 (Date of publication)
AY: 2005-06
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S. 115JB: AO entitled to tinker with P&L A/c if assessee's claim not permitted by accounting principles

The question that had arisen was whether the Assessing officer was entitled to disturb the net profit shown by the assessee in the profit and loss account prepared as per the Companies Act, 1956.in order to enable anybody to understand …

Padinjarekara Agencies Pvt. Ltd vs. ACIT (ITAT Cochin) Read More »

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DATE: October 16, 2014 (Date of pronouncement)
DATE: October 21, 2014 (Date of publication)
AY: 2003-04
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S. 68: Law regarding addition of share application money as unexplained credit explained

The only issue here is the addition of Rs.60 lacs made by the Assessing Officer as unexplained credit on account of the share application money. On going through the facts of the case, we notice that assessee has filed the …

ITO vs. Rakam Money Matters P. Ltd (ITAT Delhi) Read More »