Section 80IAB(e) of the Income-tax Act, 1961 specifies that the eligible project should be the only project on the plot of land. Therefore, if 2 projects are on the same plot of land, the assessee will not be eligible for deduction. (read more)

Section 194LA of the Income-tax Act, 1961 pertains to deduction at source on payment of compensation on acquisition of certain immovable property. However, it is clarified that the same will not be applicable to agricultural land. Therefore, no TDS will be deducted on payments to the taxpayer. (read more)

Section 234A & section 234B of the Income-tax Act is applicable to the returned income as determined under section 143(1) of the Act. Therefore the decision of the Hon’ble Patna High Court – Full Bench in the case of Smt Tejkumari v CIT 114 Taxman 404 is still good in law. (read more)

It would be imperative to peruse through the Order of revision issued under section 263 of the Income-tax Act, 1961. If the Order has directed the Ld. Assessing Officer to make a de novo assessment, then the directions of the Additional commissioner of Income-tax would be valid in law. If there are instructions pertaining to… (read more)

It would be pertinent to understand that the nomenclature i.e., “Development Agreement” cannot be the reason for deciding disallowance. As section 54F of the Income-tax Act, 1961, is a beneficial provision granting an exemption, the same would be construed strictly and onus is on the tax-payer to establish its entitlement to exemption. But once the… (read more)

The issue of credit for payment of advance tax paid earlier is subject of matter of writ pending before High Court . One has to read the recorded reasons for reassessment . If the recorded reason is for failure to pay the tax as per declaration or based on the IDS declaration . The assessee… (read more)

Partnership is considered as same entity as individual partners, i.e. it is not separate legal entity. Reference can be made to the judgment of Hon’ble Supreme Court in case of CIT v. Hind Construction (1972 ) 83 ITR 211 (SC) ( dated 16.09.1971), in which it is held that the transfer of assets to firm… (read more)

It is pertinent to note that section 44AB of the Income-tax Act, 1961 is qua the assessee and not qua the business. Therefore, the assessee would have to prepare and file a tax audit report, if applicable, without segregating the businesses. Further, an Audit report is not a criterion for carry forward of losses. However,… (read more)

The Hon’ble Supreme Court in the case of Miss Dhun Dadabhoy Kapadia v. CIT [1967] 63 ITR 651 (SC) held that, any diminution in the price of the existing shares, as a result of right issue cannot be set-off against the amount received on renouncing the right to receive shares, while computing Capital Gains. Therefore,… (read more)

Once search warrant is issued in the name of Mrs X and her son Y. The revenue must have prepared the panchanama and also statement in the course of search proceedings . The validity of search proceedings can be challenged by writ and not in appeal proceedings . However if no incriminating material was found… (read more)