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COURT:
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DATE: (Date of pronouncement)
DATE: December 10, 2009 (Date of publication)
AY:
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CITATION:

The word “production” is wider in its scope than the word “manufacture”. It means manufacture plus something in addition thereto. This ground reality is now noted in s. 2(29BA) inserted by Finance Act, 2009 w.e.f 1.4.2009. In Lucky Minmat 245 ITR 830 (SC), it was held that mere mining of limestone and marble and cutting the same before it was sold will not constitute “manufacture” or “production” but conversion into lime and lime dust could constitute the activity of manufacturing or production. In Aman Marble Industries 157 ELT 393 (SC) it was held that cutting of marble blocks into marble slabs was not “manufacture” but the Court was not concerned whether there was “production”.

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COURT:
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DATE: (Date of pronouncement)
DATE: December 9, 2009 (Date of publication)
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CITATION:

The Applicant’s case falls within s. 44BB because the words in connection with therein have an expansive meaning. The services provided by the Applicant have a real, intimate and proximate nexus with the prospecting for or extraction of mineral oils. The seismic survey and data acquisition is a prelude and critical component of the oil and gas exploration activity. Without seismic data acquisition and interpretation, it is impracticable to carry out the activity of prospecting which is a step in aid to exploration.

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COURT:
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DATE: (Date of pronouncement)
DATE: December 6, 2009 (Date of publication)
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CITATION:

The effect of the amendment to s. 36 (1) (vii) is that it is not necessary for the assessee to establish that the debt had become bad in the previous year and mere writing of the debt as irrecoverable is sufficient. However, the said entry of write off of the bad debt in the books of accounts is not conclusive and the AO is not precluded from making inquiries as to whether the entries are genuine and not imaginary or fanciful. The AO has the power u/s 143(2) to see that the entries are not mere paper work or fake.

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COURT:
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DATE: (Date of pronouncement)
DATE: December 2, 2009 (Date of publication)
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CITATION:

The deletion of the second proviso to s. 43B, and the amendment to the first proviso, by the Finance Act, 2003 was to overcome implementation problems. Consequently, the amendments, though made applicable by Parliament only with effect from 1.4.2004, were curative in nature and would apply retrospectively w.e.f. 1.4.1988.

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COURT:
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DATE: (Date of pronouncement)
DATE: December 2, 2009 (Date of publication)
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CITATION:

No capital gains in a business reorganization if consideration not determinable. Transfer pricing law does not apply if there is no income

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DATE: (Date of pronouncement)
DATE: December 1, 2009 (Date of publication)
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CITATION:

The case was a classic one of change of opinion. The question whether a subsidy is capital or revenue depends on the facts of the case. S. 154 can only apply to a “mistake apparent from the record”. A “rectifiable mistake” is a mistake which is obvious and not something which has to be established by a long drawn process of reasoning or where two opinions are possible. Decision on debatable point of law cannot be treated as a “mistake apparent from the record”.

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DATE: (Date of pronouncement)
DATE: November 25, 2009 (Date of publication)
AY:
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CITATION:

In Syncome Formulations, the Special Bench had to consider two questions i.e. (a) method of computation of deduction u/s 80HHC and (b) percentage of deduction allowable in each year. As regards the percentage of deduction, the Special Bench held that the assessee would be entitled to 100% deduction. This view was overruled by the High Court in Ajanta Pharma where it was held that in view of s. 80HHC (1B), deduction was only allowable as per the limits set out therein. However, the first issue as to the method of deduction u/s 80HHC was not before the High Court. As per Sun Engineering 198 ITR 297, the observations of a Court have to be read in context. Consequently, the judgement of the Special Bench on this aspect still held good and the assessee was entitled to deduction u/s 80HHC even though there were no normal profits.

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COURT:
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DATE: (Date of pronouncement)
DATE: November 19, 2009 (Date of publication)
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CITATION:

The effect of the judgement of the Supreme Court in Transmission Corporation of India 239 ITR 587 is that the moment there is a payment to a non-resident, there is an obligation on the payer to deduct tax at source u/s 195 (1). The only way to escape the liability is for the payer to make an application to the AO u/s 195 (2) for non-deduction or for deduction at a lower rate. If the payer does not make an application and obtain an order u/s 195 (2), it is not open to him to argue that the payment has not resulted in taxable income in the hands of the non-resident recipient and that, therefore, there is no failure on the part of the payer to deduct tax u/s 195 (1)

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COURT:
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DATE: (Date of pronouncement)
DATE: November 18, 2009 (Date of publication)
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CITATION:

Under the Doctrine of Merger, once an appeal against the order passed by an authority is preferred and is decided by the appellate authority, the order of the said authority merges into the order of the appellate authority. With this merger, the order of the original authority ceases to exist and the order of the appellate authority prevails, in which the order of the original authority is merged. For all intent and purposes, it is the order of the appellate authority that has to be seen for purposes of determining the limitation period u/s 154 (7) for passing a rectification order.

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COURT:
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COUNSEL:
DATE: (Date of pronouncement)
DATE: November 16, 2009 (Date of publication)
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CITATION:

S. 132 (1) (c) empowers the officer to enter the premises etc and search it if he has “reason to believe” that “any person” is in possession of any money, bullion etc representing undisclosed income. As the search warrant was issued in the joint names of the assessee and her spouse, it means that the officer had reason to believe that the undisclosed assets and income were held jointly. If so, it is not open for the AO to assess the assessee individually on the basis of the assets and documents seized during the course of search in pursuance to the said warrant but the assessment ought to have been only in the capacity of AOP or BOI.

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