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.2(14)(iii): Capital asset-Agricultural land- Capital gains- Agricultural lands and beyond 8 k.m., from the notified cities – Revenue records showing as agricultural lands- Department to prove that the entries in the revenue records and the patta were false or bogus- Entitle to exemption .[ S.45 ]

PCIT v. K. P. R. Developers Ltd. (2019) 311 CTR 832/ 183 DTR 406 / 274 Taxman 449(Mad.)(HC)

S. 147 : Reassessment –Bogus share capital- Parent company – Indian subsidiaries- Information from investigation wing – Credit worthiness of the investing company- Reassessment notice is held to be valid .[ S.68 , 148 ]

Experion Development Pvt. Ltd. v. ACIT ( 2020 ) 422 ITR 355/ 115 taxmann.com 338 (Delhi)(HC)

S. 143(3): Assessment – E-Assessment – Post demonetization-The AO should at least call for an explanation in writing before proceeding to conclude that the amount collected by the assessee was unusual- The AO could have come to a definite conclusion on facts after fully understanding the nature of business of the assessee-Order of AO is set aside and directed the AO is directed to dispose the matter with in sixty days of receipt of the order . [S.69A ,115BBE.]

Salem Sree Ramavilas Chit Company v. DCIT( 2020) 423 ITR 525/ 114 taxmann.com 492/ 273 Taxman 68/187 DTR 217/ 313 CTR 473 (Mad)(HC), www.itatonline.org . Editorial : Order set aside Dy. CIT v. Salem Sree Ramavilas Chit Co. P. Ltd. (2021)437 ITR 597 / 323 CTR 207(Mad) (HC) Dy. CIT v. Salem Sree Ramavilas Chit Co. P. Ltd. (2021)437 ITR 597 (Mad) (HC)

S. 92C : 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.

Celltick Technologies Ltd. v. DCIT ( 2019 ) 109 taxmann.com 334 (Mum)(Trib), www.itatonline.org

S. 45: Capital gains- Long term capital loss – A reduction of capital results in an “extinguishment of rights” in the shares and constitutes a “transfer‟- The fact that the percentage of shareholding remains unchanged even after the reduction is irrelevant. The loss arising from the cancellation of shares is entitled to indexation and is allowable as a long-term capital loss.[ S. 2(22)(d),2(47),10(34) ,48,49(2),115A, 1150 ]

Carestream Health Inc v. DCIT (Mim)(Trib), www.itatonilne.org

S. 43B : Certain deductions on actual payment – The credit of Excise Duty earned under MODVAT scheme is not sum payable by the assessee by way of tax, duty, cess – unutilised credit under MODVAT scheme does not qualify for deduction – Sales tax paid by the appellant was debited to a separate account titled ‘Sales Tax recoverable account’ and is liable for disallowance .[S. 145 ]

Maruti Suzuki India India Ltd. v. CIT (2020) 421 ITR 510/ 114 taxmann.com 129 / 270 Taxman 75/186 DTR 353 / 313 CTR 113 (SC) www.itatonline.org Editorial: Order in Maruti Udyog Ltd v . CIT ( 2017) 88 taxmann.com 98 /(2018) 253 Taxman 60/ 406 ITR 562 /161 DTR 1/ 308 CTR 682(Delhi) (HC) is affirmed .

S. 69C : Unexplained expenditure – Bogus purchases – Accommodation entries – Restricting the disallowances at 5% of alleged bogus purchases is held to be justified – Entire purchases cannot be disallowed . [ S. 37(1),144 ]

PCIT v. Rishabhdev Tachnocable Ltd (2020) 424 ITR 338 /187 DTR 473 (Bom) (HC). www.itatonline .org

S. 263 : Commissioner – Revision of orders prejudicial to revenue – Provision for expenses – Revision is held to be not valid [ S.37(1) ]

Khetawat Properties Ltd. v. PCIT (2020) 180 ITD 535 / 189 DTR 346/ 205 TTJ 412 (Kol) (Trib.)

S. 251 : Appeal – Commissioner (Appeals) – Powers – Enhancement – CIT (A) cannot enhance a new source of income to tax which was not considered by assessee. [ S.68, 147, 251(2), 263 ]

Mylan Laboratories Ltd. v. DCIT (2020) 180 ITD 558/187 DTR 259/ 204 TTJ 426 (Hyd) (Trib.)

S. 234B : Interest – Advance tax – Book profit – Retrospective amendment to provision of S. 115JB- Not liable to pay interest .[ S.115JB ]

ACIT v. JSW Steel Ltd. (2020) 180 ITD 505 (Mum) (Trib.)