S. 5 : Scope of total income-Accrual-Real income theory-Bad debt -Mercantile system of accounting-Bill raised for premature termination of contract-Contracting company not accepting Bill- Income did not accrue–Another bill of which a small part is received after four years–Claim as bad debt is to be accepted. [S. 36(1)(vii)]
S. 4 : Charge of income-tax–Capital or revenue-Grant in aide– Disbursement of salaries and flood relief-Protect the functioning of the assessee-Held to be capital receipt. [S. 28(i)]
S. 2(24) : Income–Collection of value added tax on behalf of the State Government–Excess over expenditure deposited in State Treasury–Not assessable as income. [S. 2(24(i), 12A]
Prohibition of Benami Property Transactions Act , 1988.
S.3: Prohibition of benami transactions- The Benami Amendment Act, 2016, amending the Benami Act, 1988, comes into force on 01.11.2016 and does not have retrospective effect. [S. 2((9), 5,8 / Art . 226 , 227 ]
S. 254(1) : Appellate Tribunal -Low tax effect Appeals- Less than 50 lakhs – Applies to all pending appeals- 628 Departmental appeals are dismissed . [ S.253 ] .
S. 197 : Deduction at source – Certificate for lower rate –Quasi judicial – Must be supported by valid and cogent reasons- Orders passed by a statutory authority under “dictation” of a superior officer or anyone else is bad in law .[ R.28AA ]
S. 143(2) : Assessment – Notice –Failure to issue a notice u/s 143(2) renders the assessment order void even if the assessee has participated in the proceedings -Deeming fiction does not operate to save complete absence of notice [ S.292BB ]
S. 92CA: Reference to transfer pricing officer – CBDT’s Instruction No.3/2003 dated 20.05.2003 makes it mandatory for the AO to make a reference to the TPO- The failure to make reference to the TPO renders the Transfer Pricing Adjustments made therein are bad in law though the assessment order is good- The matter should be restored to the file of the AO so that appropriate reference could be made to the TPO.[ S. 92C, 119 ]
S. 68 : Cash credits –Share capital premium- The test of human probabilities cannot be applied to business transactions- The AO cannot reach this conclusion without further investigation and bringing material on record -Reopening is held to be bad in law [ S.147, 148 ]. .
S. 56 : Income from other sources –HUF –Relative – Amounts received by a member from the ‘HUF’ cannot be said to be income of the member exigible to taxation- Revision is held to be not valid [ S.56(2) (vii), 263 ].