This Digest of case laws is prepared by KSA Legal and AIFTP from judgements reported in BCAJ, CTR, DTR, ITD, ITR, ITR (Trib), Chamber's Journal, SOT, Taxman, TTJ, BCAJ, ACAJ, www.itatonline.org and other journals
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S. 36(1)(iii) : Interest on borrowed capital-Presumption that investment was made from interest-free funds-Disallowance of interest is held to be not justified-Expansion and Extension of business-Proviso to Section 36(1)(iii) applies only to extension of business-Proviso does not have retrospective operation-Res judicata is not applicable to income tax proceedings but principle of consistency must be followed.

Coffeeday Global Ltd. v. Add. CIT (2021) 433 ITR 321 / 202 DTR 217/ 322 CTR 336 (Karn.)(HC) PCIT v. Amalgamated Bean Coffee Trading Co. Ltd. (2021) 433 ITR 321 / 202 DTR 217/ 322 CTR 321 (Karn.)(HC)

S. 32 : Depreciation-Windmill-Generated a small amount of electricity-Entitle to depreciation.

CIT(LTU) v. Lakshmi General Finance Ltd. (2021) 433 ITR 94/ 282 Taxman 82 (Mad.)(HC)

S. 14A : Disallowance of expenditure-Exempt income-Only to the extent of expenses incurred in relation to exempt income [R.8D]

PCIT v. HCL Comnet Systems and Services Ltd. (2021)433 ITR 251 (Delhi) (HC)

S. 14A : Disallowance of expenditure-Exempt income-Disallowance not to exceed exempt income. [R. 8D]

PCIT v. EWS Finance & Investments Pvt. Ltd. (2021) 433 ITR 23 (Mad.)(HC)

S. 14A : Sufficient interest free funds available-investment are presumed to be out of interest free funds-only those investments to be considered which yield exempt income for the purpose of calculation. [R. 8D(2)(ii)]

Nandi Steels Ltd v ACIT (2021) 320 CTR 432 / 201 DTR 37 (Karn.)(HC)

S. 12A : Registration-Trust-Exemption cannot be denied merely because certificate could not be produced as the same was destroyed during folds of 1978-Matter remanded. [S. 11, 12A, 12AA and 143(3)]

Morbi Plot Jain Tapgachh Sangh v. CIT (2021) 433 ITR 1 / 202 DTR 385 / 321 CTR 198 (Guj.)(HC)

S. 11 : Property held for charitable purposes-Income from business or business held in trust-Main object is for establishing, maintaining and running a hospital for philanthropic purposes and not for the purpose of profit-Entitle exemption. [S. 2(15)]

Bharathakshemam v. PCIT (2021) 320 CTR 198 / 199 DTR 113 (Ker.)(HC)

S. 10A : Free trade zone-Export turnover-Telecommunication expenses and foreign currency expenditure not to be excluded from export turnover.

PCIT v. HCL Comnet Systems And Services Ltd. (2021) 433 ITR 251 (Delhi)(HC)

S. 4 : Charge of income-tax-Carban credit-Capital or revenue-sale of certified emission reduction credit, which the assessee earned on the clean development mechanism in its wind energy operations, was a capital receipt and not taxable.

CIT v. Ambika Cotton Mills Ltd. (2021)433 ITR 193 / 279 Taxman 405 (Mad.)(HC) Editorial : Order in Ambika Cotton Mills Ltd. v Dy. CIT (2013) 27 ITR 44 (Chennai)(Trib.) is affirmed.

S. 254(2)): Appellate Tribunal – Rectification of mistake apparent from the record-Duties – High Court directed the Appellate Tribunal to upload the daily order sheets and revised cause list on its website – System in this regard be put in place by the ITAT , if not already there as expeditiously as possible , preferable within three months [ S. 253 , 254(1), 255 , , ITAT Rules ,1963 19, 20Art . 226 ]

Ankit Kapoor v. ITO ( 2021 ) 205 DTR 21/ 322 CTR 208/ ( 2022) 440 ITR 386 ( Delhi ) (HC)