COURT:
CORAM: ,
SECTION(S):
GENRE:
CATCH WORDS: ,
COUNSEL:
DATE: February 7, 2020 (Date of pronouncement)
DATE: February 15, 2020 (Date of publication)
AY: 2000-01
FILE: Click here to view full post with file download link
CITATION:
U/s 43B(a), deduction is allowed on “any sum payable by the assessee by way of tax, duty, cess or fee.” The scheme of s. 43B is to allow deduction when the sum is actually paid. (i) The credit of Excise Duty earned under MODVAT scheme is not sum payable by the assessee by way of tax, duty, cess. It is merely the incident of Excise Duty that has shifted from the manufacturer to the purchaser and not the liability to the same. Consequently, the unutilised credit under MODVAT scheme does not qualify for deduction u/s 43B. (ii) The sales tax paid by the appellant was debited to a separate account titled ‘Sales Tax recoverable account’ and is liable for disallowance u/s 43B.

Deductions under Section 43B is allowable only when sum is actually paid by the assessee. In the present case, the Excise Duty leviable on appellant on manufacture of vehicles was already adjusted in the concerned assessment year from the credit of Excise Duty under the MODVAT scheme. The unutilised credit in the MODVAT scheme cannot be treated as sum actually paid by the appellant. The assessee when pays the cost of raw materials where the duty is embedded, it does not ipso facto mean that assessee is the one who is liable to pay Excise Duty on such raw material/inputs. It is merely the incident of Excise Duty that has shifted from the manufacturer to the purchaser and not the liability to the same

COURT:
CORAM: ,
SECTION(S): ,
GENRE:
CATCH WORDS: ,
COUNSEL:
DATE: February 10, 2020 (Date of pronouncement)
DATE: February 15, 2020 (Date of publication)
AY: 2010-11
FILE: Click here to view full post with file download link
CITATION:
S. 68 Bogus Purchases: Though the assessee has not proved the genuineness of the purchases and sales, yet if the AO has accepted the sales, the entire purchases cannot be disallowed. Only the profit element embedded in purchases would be subjected to tax and not the entire amount (Bholanath Polyfab 355 ITR 290 (Guj) followed, Kaveri Rice Mills 157 Taxman 376 (All) & La Medica 250 ITR 575 (Del) referred)

Having found that the purchases corresponded to sales which were reflected in the returns of the assessee in sales tax proceedings and in addition, were also recorded in the books of accounts with payments made through account payee cheques, the purchases were accepted by the two appellate authorities and following judicial dictum decided to add the profit percentage on such purchases to the income of the assessee. While the CIT (A) had assessed profit at 2% which was added to the income of the assessee, Tribunal made further addition of 3% profit, thereby protecting the interest of the Revenue

COURT:
CORAM: ,
SECTION(S):
GENRE:
CATCH WORDS: , ,
COUNSEL: ,
DATE: June 11, 2019 (Date of pronouncement)
DATE: February 15, 2020 (Date of publication)
AY: 2014-15
FILE: Click here to view full post with file download link
CITATION:
Transfer Pricing: (i) If the "arms length‟ principle is satisfied qua the relevant transaction between the assessee and its Indian subsidiary, no further profits can be attributed to the assessee in India even if it was to be held that the latter had a PE in India (ii) If the subsidiary has subsequently entered into an "APA‟ with the CBDT & the FAR analysis and overall functions remain unchanged, the "APA‟ would have a bearing on the ALP of the earlier years

The Indian subsidiary of the assessee had for A.Y. 2015-16 to A.Y 2019-20 entered into an “APA‟ with the CBDT. As is discernible from the “APA‟, the functions of the subsidiary company inter alia included “marketing and sale of various software solutions” of the assessee company. As per the “APA‟ the operating profit margin up to its revenue of Rs. 50 crore was to be taken at 7% of its “Operating revenue‟. Admittedly, the FAR analysis and overall functions of the subsidiary company had remained the same during the period covered by the “APA‟ and that for the year under consideration i.e A.Y 2014-15. Though, the APA in the case of the assessee had been entered into for the period spread over A.Y. 2015- 16 to A.Y 2019-20, however, as held by the ITAT, Mumbai in the case of 3i India Pvt. Ltd. Vs. DCIT (ITA No. 581/Mum/2015, dated 16.09.2016), a subsequent “APA‟ would also have a bearing on the earlier years

COURT:
CORAM: ,
SECTION(S):
GENRE:
CATCH WORDS: ,
COUNSEL:
DATE: February 4, 2020 (Date of pronouncement)
DATE: February 12, 2020 (Date of publication)
AY: -
FILE: Click here to view full post with file download link
CITATION:
S. 68 Bogus share capital/ premium: Application seeking open court oral hearing is rejected. There is no substance in the Review Petition seeking review of PCIT vs. NRA Iron & Steel Pvt. Ltd (2019) 412 ITR 161 (SC) and the same is dismissed

We have gone through the contents in the Review Petition and do not find any substance in the submissions raised therein. Consequently, this Review Petition is dismissed

COURT:
CORAM: ,
SECTION(S):
GENRE:
CATCH WORDS: , ,
COUNSEL:
DATE: February 28, 2019 (Date of pronouncement)
DATE: February 12, 2020 (Date of publication)
AY: -
FILE: Click here to view full post with file download link
CITATION:
Refund of excess taxes: The dept has as usual raised all kind of technicalities in respect of an Army Officer who has dedicated his entire life towards the service of the Nation. The same Army Officer who defended our motherland including the 'Babus' sitting in the Income Tax Department is being subjected to harassment. The Colonel, who has made the life of Income Tax Officials and all of us smooth and comfortable and all those Income Tax Officers, who were able to sleep peacefully in their home because the borders were being guarded by the Army Officer. The Dept is trying to put all kind of spokes in the matter of refund for which he is genuinely entitled by virtue of CBDT notification. Suo motu contempt proceedings threatened against CIT & PCIT if refund not granted within 30 days

Our Army Soldiers, Naval Officials and Fighter Pilots are Day and Nights protecting Our Territorial Borders from Enemy Infiltration and Attacks and even while putting their life to the greatest risk, are keeping all Citizens safe and Secure and making Our life free from all such Dangers, where they don’t think of “Technicalities” while Fighting with Enemies at the Front, as to whether pulling the Trigger of their Gun would invite a “Court of inquiry” and from this practical perspective this Court wants to express its concern for not putting too much of technicalities in such matters by those who are invested with Administrative Powers to deal and decide the affairs of the Personnel of Indian Armed Forces

COURT:
CORAM: ,
SECTION(S):
GENRE:
CATCH WORDS:
COUNSEL:
DATE: January 17, 2020 (Date of pronouncement)
DATE: February 8, 2020 (Date of publication)
AY: -
FILE: Click here to view full post with file download link
CITATION:
Condonation of delay: There are large gaps which are unexplained. It is not known whether any action was taken against the officers who are responsible for the inordinate delay. The highest Court cannot be a walk in place to file any time irrespective of period of limitation prescribed. To blame it on the inefficiency of the administration is no more good excuse. Administration directed to hold an inquiry into the aspect as to who is responsible for such inordinate delay and take suitable action against the officers concerned (Post Master General vs. Living Media (2012) 3 SCC 563 referred)

This is one more case which we have defined as “Certificate Cases” – the object being only to obtain dismissal from the Supreme Court. We have perused the application for condonation of delay also. There are large gaps which are unexplained and there are no instructions with the counsel whether any action was taken against the officers who are responsible for the inordinate delay

COURT:
CORAM: ,
SECTION(S):
GENRE: ,
CATCH WORDS: ,
COUNSEL: , ,
DATE: December 24, 2019 (Date of pronouncement)
DATE: February 8, 2020 (Date of publication)
AY: -
FILE: Click here to view full post with file download link
CITATION:
Search & Seizure: The action of the GST authorities of camping in the assessee's home for 8 days and placing him under house arrest is illegal & a blatant abuse of powers. It has shocked the conscience of the court. This unauthorised action of the officers may tantamount to an offence under the Indian Penal Code. The officials cannot take shelter behind ignorance of law to justify their illegal actions. It is a matter of deep regret that the Chief Commissioner has attempted to justify such wrongful action on the part of the officials

It is a matter of deep regret that the Chief Commissioner of State Tax has attempted to justify such wrongful action on the part of the officers of the department by placing reliance upon the provisions relating to power of investigation under an earlier enactment to justify the actions of the concerned officers who were exercising powers of search and seizure under section 67(2) of the GST Acts. One would expect the higher officer to reprimand the subordinate officers for their unauthorised actions. But in this case, the higher ups, for reasons best known to them are trying to shield the actions of the subordinate officers though they are not in a position to show the relevant provisions of law under which such officers were empowered to act in this manner. All that the court can say at this stage is that the reports submitted of the Chief Commissioner in response to the orders dated 25.10.2019 and 20.11.2019, do not meet with the standards expected from an authority of his stature

COURT:
CORAM: ,
SECTION(S): , ,
GENRE:
CATCH WORDS: ,
COUNSEL:
DATE: February 5, 2020 (Date of pronouncement)
DATE: February 8, 2020 (Date of publication)
AY: 2008-09
FILE: Click here to view full post with file download link
CITATION:
S. 153A: Once the assessment gets abated, the original return filed u/s 139(1) is replaced by the return filed u/s 153A. It is open to both parties, i.e. the assessee and revenue, to make claims for allowance or disallowance. The assessee is entitled to lodge a new claim for deduction etc. which remained to be claimed in his earlier/ regular return of income (Continental Warehousing Corporation 374 ITR 645 (Bom) referred)

In view of the second proviso to Section 153A(1) of the said Act, once assessment gets abated, it is open for the assessee to lodge a new claim in a proceeding under Section 153A(1) which was not claimed in his regular return of income, because assessment was never made/finalised in the case of the assessee in such a situation

COURT:
CORAM: ,
SECTION(S): ,
GENRE:
CATCH WORDS:
COUNSEL:
DATE: October 31, 2019 (Date of pronouncement)
DATE: February 8, 2020 (Date of publication)
AY: 2009-10
FILE: Click here to view full post with file download link
CITATION:
S. 253(3) Condonation of delay: The tendency to perceive delay as a non-serious matter should be discouraged. The notion that the ITAT should always condone the delay should not be promoted. For mistake of lawyer to serve as valid consideration for the purpose of condonation of delay, the mistake must be such as may be made by a professional lawyer well-versed and experienced in law. "Useless advice" by a professional to not file appeal and to instead file a Cross Objection if Revenue filed the appeal cannot help the assessee because there was always going to be a chance that Revenue might not file appeal. Counsel must disclose the circumstances in which incorrect advice was given and, it is not sufficient to make a perfunctory and general statement that wrong advice was given bonafide (all judgements considered)

It is not as if mistake of a legal advisor, however, gross and inexcusable, will entitle an assessee to condonation of delay in filing of appeal. The facts of the case are to be examined to ascertain if there had been negligence or gross want of skill, competence or knowledge on the part of the legal advisor; or whether there was only a mistake that even a skilled legal advisor, well-versed and experienced in law might make that mistake. It is only in the latter case that an assessee may justifiably seek condonation of delay

COURT:
CORAM: ,
SECTION(S):
GENRE:
CATCH WORDS: ,
COUNSEL: ,
DATE: January 29, 2020 (Date of pronouncement)
DATE: February 5, 2020 (Date of publication)
AY: 2010-11
FILE: Click here to view full post with file download link
CITATION:
S. 68 Bogus share capital: The identity of the investors were not in doubt. The assessee had furnished PAN, copies of the income tax returns of the investors as well as copy of the bank accounts in which the share application money was deposited in order to prove genuineness of the transactions. In so far credit worthiness of the creditors were concerned, the bank accounts of the investors showed that they had funds to make payments for share application money. The assessee was not required to prove source of the source. Nonetheless, the inquiries through the investigation wing of the department at Kolkata proved source of the source (PCIT vs. NRA Iron & Steel 412 ITR 161 (SC) distinguished)

In NRA Iron & Steel (P) Ltd (supra), the Assessing Officer had made independent and detailed inquiry including survey of the investor companies. The field report revealed that the shareholders were either non-existent or lacked credit-worthiness. It is in these circumstances, Supreme Court held that the onus to establish identity of the investor companies was not discharged by the assessee. The aforesaid decision is, therefore, clearly distinguishable on facts of the present case