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COURT:
CORAM:
SECTION(S):
GENRE:
CATCH WORDS:
COUNSEL:
DATE: (Date of pronouncement)
DATE: November 19, 2012 (Date of publication)
AY:
FILE: Click here to view full post with file download link
CITATION:

The mere fact that a revised return was filed withdrawing a claim or offering additional income before issue of a formal notice by the AO does not necessarily mean that the return is voluntary. The filing of a revised return does not expatiate the contumacious conduct, if any, on the part of the assessee in not having disclosed the true income in the original return. At the same time, it cannot be said that the revised return is of no consequence at all. The original return cannot be considered in isolation without reference to the conduct of the assessee subsequent to the filing of the original return. The question whether a revised return is “voluntary” or not has to be decided in the light of the entire material brought on record and whether the revised return was filed when the assessee is cornered by the evidence or material collected by the revenue authorities or before that stage. On facts, the revised return was filed by the assessee only when it was cornered and the income tax authorities had collected material on the basis of which it could be said that the claim for deduction was false or bogus. The filing of the revised return is thus an act of despair and the assessee can gain nothing from it (Qammar-Ud-Din 129 ITR 703 (Del), Sarvaria 158 ITR 803 (Del), Ramdas Pharmacy 77 ITR 276 (Mad) & S.A.S. Pharmaceuticals 335 ITR 259 (Del) referred)

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COURT:
CORAM:
SECTION(S):
GENRE:
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COUNSEL:
DATE: (Date of pronouncement)
DATE: November 8, 2012 (Date of publication)
AY:
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CITATION:

The objects of the assessee is not for advancement, support or propagation of a particular religion. Worshipping Lord Shiva, Hanumanji, Goddess Durga and maintaining the temple is not advancement, support or propagation of a particular religion. Lord Shiva, Hanumanji & Goddess Durga do not represent any particular religion. They are merely regarded to be the super power of the universe. Further, there is no religion like “Hinduism”. The word “Hindu” is not defined in any of the texts nor in judge made law. The word was given by British administrators to inhabitants of India, who were not Christians, Muslims, Parsis or Jews. Hinduism is a way of life. It consists of a number of communities having different gods who are being worshipped in a different manner, different rituals, different ethical codes. The worship of god is not essential for a person who has adopted Hinduism way of life. Therefore, expenses incurred for worshipping of Lord Shiva, Hanuman, Goddess Durga and for maintenance of temple cannot be regarded to be for religious purpose (Commissioner of Hindu Religious and Charitable Endowments vs. Sri Lakshmindra Thirtha Swamiar 1954 SCJ 335 & T. T. Kuppuswamy Chettiar Vs. State of Tamil Nadu (1987) 100 LW 1031 followed)

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COURT:
CORAM:
SECTION(S):
GENRE:
CATCH WORDS:
COUNSEL:
DATE: (Date of pronouncement)
DATE: November 8, 2012 (Date of publication)
AY:
FILE: Click here to view full post with file download link
CITATION:

The non-compete rights cannot be treated as an “intangible asset” u/s 32(1)(ii) because (a) the nature of the rights mentioned in the definition of “intangible asset” spell out an element of exclusivity which enures to the assessee as a sequel to the ownership. But for the ownership of the intellectual property or know-how or license or franchise, it would be unable to assert the right “in rem”, as against the world. In the case of a non-competition agreement, it is a right “in personam” where the advantage is restricted & does not confer an exclusive right to carry-on the primary business activity. (b) Another way of looking at the issue is whether such rights can be treated or transferred. Every species of right spelt-out such as know-how, franchise, license etc. and even those considered by Courts, such as goodwill, can be said to be alienable. Such is not the case with an agreement not to compete which is purely personal (Techno Shares & Stocks 327 ITR 323 (SC), Hindustan Coco Cola Beverages 331 ITR 192 (Del) & B. Ravindran Pillai 332 ITR 531 (Ker) distinguished)

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COURT:
CORAM:
SECTION(S):
GENRE:
CATCH WORDS:
COUNSEL:
DATE: (Date of pronouncement)
DATE: November 7, 2012 (Date of publication)
AY:
FILE: Click here to view full post with file download link
CITATION:

Article 22 (1) provides that items of income of a resident of Switzerland “which are not dealt with” in the foregoing Articles of the DTAA shall be taxable only in that State. The department’s argument that by agreeing to exclude shipping profits from Article 8 as well as Article 7 of DTAA, it has been “dealt with” and, therefore, Article 22(1) shall not apply is not correct. The expression “dealt with” contemplates a positive action and it is necessary that the relevant article must state whether Switzerland or India or both have a right to tax such item of income. Vesting of such jurisdiction must positively and explicitly stated and it cannot be inferred by implication. It is also the view of the Competent Authorities in the letters exchanged that shipping profits would be governed by Article 22 & not s. 44B of the Act (Gearbulk AG 184 Taxman 383 (AAR) not followed)

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COURT:
CORAM:
SECTION(S):
GENRE:
CATCH WORDS:
COUNSEL:
DATE: (Date of pronouncement)
DATE: November 7, 2012 (Date of publication)
AY:
FILE: Click here to view full post with file download link
CITATION:

The scope of proceedings after remand depend on the terms of the remand order. If the appellate authority has set aside the assessment and directed the making of a fresh assessment without imposing any restrictions or limitations, the AO has the same powers in making fresh assessment as he originally had. However, if any restrictions are placed, the AO cannot travel beyond those restrictions. The scope of the remand order has to be determined depending on the subject matter of the appeal and the appellate order read as a whole in its proper context. On facts a perusal of the findings of the CIT (A) shows that he was concerned with the additions made in the original assessment order and it was in the light of the additions made therein, that the assessment was set aside for denovo consideration. This clearly shows that the directions of the CIT (A) for denovo assessment were restricted to the additions made by the AO in the original assessment order and, therefore, the AO had no jurisdiction to look at other issues

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COURT:
CORAM:
SECTION(S):
GENRE:
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COUNSEL:
DATE: (Date of pronouncement)
DATE: November 6, 2012 (Date of publication)
AY:
FILE: Click here to view full post with file download link
CITATION:

The conduct of the ACIT & CIT is highly deplorable. Once the jurisdiction to assess the assessee was transferred from Mumbai to Pune, it was totally improper on the part of ACIT Mumbai to request the CIT to pass a corrigendum order with a view to circumvent the jurisdictional issue. Making this request was in gross abuse of the process of law. If there was any time barring issue, the ACIT Mumbai ought to have asked his counterpart at Pune to whom the jurisdiction was transferred to take appropriate steps in the matter instead of taking steps to circumvent the jurisdictional issue. It does not befit the ACIT Mumbai to indulge in circumventing the provisions of law and his conduct has to be strongly condemned. Instead of bringing to book persons who circumvent the provisions of law, the ACIT has himself indulged in circumventing the provisions of law which is totally disgraceful. The CIT ought not to have succumbed to the unjust demands of the ACIT and ought to have admonished the ACIT for making such an unjust request. The CIT ought to have known that there is no provision under the Act which empowers the CIT to temporarily withdraw the order passed by him u/s 127(2) for the sake of administrative convenience or otherwise. If the CIT was honestly of the opinion that the order passed u/s 127(2) was required to be recalled for any valid reason, he ought to have issued notice to that effect to the assessee and passed an order after hearing it. Further, though the CCIT agrees that the actions of the CIT and ACIT are patently unjustified and not as per law, he has expressed his helplessness in the matter. It is expected that the CCIT shall take immediate remedial steps to ensure that no such incidents occur in the future. The department shall pay costs of Rs. 10,000 which may be recovered from the CIT & ACIT

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COURT:
CORAM:
SECTION(S):
GENRE:
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COUNSEL:
DATE: (Date of pronouncement)
DATE: November 5, 2012 (Date of publication)
AY:
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CITATION:

S. 115JB (6) does not refer to either s. 10A or s. 10AA but simply provides that the MAT provisions shall not apply to income arising from any business carried on in an unit located in a SEZ. Consequently, despite the fact that an amendment was made in clause (f) of Explanation (1) to s. 115JB(2) to provide that MAT shall apply to units eligible for s. 10A or 10B, a unit which is situated in a SEZ will continue to be exempt from MAT by virtue of s. 115JB(6)

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COURT:
CORAM:
SECTION(S):
GENRE:
CATCH WORDS:
COUNSEL:
DATE: (Date of pronouncement)
DATE: November 5, 2012 (Date of publication)
AY:
FILE: Click here to view full post with file download link
CITATION:

As per Circular No.204 dated 24.7.1976 issued by the CBDT the expression “the sum for which the property might reasonably be expected to let from year to year” used in s. 23(1)(a) means the municipal valuation of the property. In Reclamation Reality, the Tribunal held, after considering the entire law on the subject, including the said Circular & M.V. Sonavala 177 ITR 246 (Bom) that the ALV had to be determined on the basis of either the Municipal rateable value (23(1)(a)) or the actual rent received (23(1)(b)), whichever is the higher. There is no scope for adding the notional interest on the security deposit to the ALV. Judicial propriety and judicial discipline require that this view be followed (CIT vs. Moni Kumar Subba 333 ITR 38 (Del) (FB) noted)

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COURT:
CORAM:
SECTION(S):
GENRE:
CATCH WORDS:
COUNSEL:
DATE: (Date of pronouncement)
DATE: November 2, 2012 (Date of publication)
AY:
FILE: Click here to view full post with file download link
CITATION:

Once the assessee obtained Form No.15-I from the sub-contractors whose contents are not disputed or whose genuineness is not doubted then the assessee is not liable to deduct tax from the payments made to sub-contractors. Once assessee is not liable to deduct tax u/s 194C then disallowance u/s 40(a)(ia) cannot be made. The assessee’s breach of the requirement to furnish details to the income tax authority in the prescribed form within prescribed time may attract other consequences but cannot result in a s. 40(a)(ia) disallowance

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COURT:
CORAM:
SECTION(S):
GENRE:
CATCH WORDS:
COUNSEL:
DATE: (Date of pronouncement)
DATE: November 1, 2012 (Date of publication)
AY:
FILE: Click here to view full post with file download link
CITATION:

Once the amount has been disallowed u/s 40(a)(i) for non-deduction of tax, it cannot be subject to TDS provisions again so as to make the assessee liable to pay the tax u/s 201 & interest u/s 201(1A). If the AO’s view was accepted that the assessee was liable to pay the TDS not deducted, then a disallowance u/s 40(a)(i) and 40(a)(ia) cannot be made and those provisions may become otiose

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