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. 80-O : Royalties – Foreign enterprises – services rendered in India and not the ‘services rendered from India -Merely having a contract with a foreign enterprise and mere earning foreign exchange does not ipso facto lead to the application of S. 80-O of the Act- Without any claim for expertise capable of being used abroad rather than in India, would not be entitled to deduction- The burden is on the assessee to prove eligibility to an incentive or exemption provision and it is subject to strict interpretation – Interpretation of taxing statutes – When there is ambiguity in exemption which is subject to strict interpretation, the benefit of such ambiguity cannot be claimed by the subject/assessee and it must be interpreted in favour of the revenue.

Ramnath and Co v. CIT ( 2020) 425 ITR 337/ 315 CTR 217/ 272 Taxman 275 / 190 DTR 1( SC) www.itatonline.org Editorial : CIT v Ramnath & CO (2016) 388 ITR 307/289 CTR 355/(2017) 79 taxmann.com 416 (Ker) (HC) is affirmed .

Constitution of India 1949

Art .141 :Precedents – Binding nature -Decision delivered by a Bench of larger strength is binding on any subsequent Bench of lesser or co-equal strength- A Bench of lesser quorum cannot disagree or dissent from the view of the law taken by a Bench of larger quorum – Subject to discretion of the Chief justice to refer the matter to larger Bench or assign the matter to a particular Bench to decide the issue . [ Consumer Protection Act 1986 , S.13(2)(a) ]

New India Assurance Co. Ltd. v. Hill Multi purpose Cold Storage P. Ltd. AIR 2016 SC 86

Transfer of property Act 1882

S.54: Sale – Power of Attorney – Sale of immovable property through execution of power of attorney sale agreement/general power of attorney/will instead of execution and registration of regular deeds of conveyance deprecated as illegal and irregular – The illegal and irregular process of `Power of Attorney Sales’ spawns several disputes relating to possession and title, and also results in criminal complaints and cross complaints and extra-legal enforcement and forced settlements by land mafia.Therefore request the Solicitor General to appear in the matter and give suggestions on behalf of Union of India. : [Indian Registration Act ,1908 , S.17, 49 ,Power of Attorney Act ,1882 S.2 ]

Suraj Lamp & Inds. (P) Ltd Thru DIR v. State of Haryana & Anr AIR 2009 SC 3077

Indian Stamps Act,1899,

S.54: Stamp Papers – Use of old stamp papers i.e., stamp paper purchased more than six months prior to proposed date of execution may certainly be a circumstance that can be used as a piece of evidence to cast doubt on authenticity of agreement but that cannot be clinching evidence to invalidate the agreement. [ S.47, Indian Evidence Act , 1872 , S.45, 73 ]

Thiruvengadam Pillai v Navaneethammal and Anr (2008) 4 SCC 530.

Indian Registration Act ,1908 .

S.47: Registered Document – Operates from date of its execution – Not from the date of its Registration [ S.17 ]

Principal Secretary, Government of Karnataka and Ors. v. Ragini Narayan and Ors. AIR 2016 SUPREME COURT 4545

S. 14A : Disallowance of expenditure – Exempt income -Not earned any tax-exempt during the relevant assessment year – Mixed funds – No disallowance can be made .[ S.80D (2)(ii) ]

Dy.CIT v JSW Ltd ( 2020) 116 taxmann.com 565 79 ITR 585 / 183 ITD 148/ 189 DTR 15/205 TTJ 1 ( Mum) (Trib) www.itatonline.org

S. 254(1) : Appellate Tribunal – Duties Order –Limitation – Pronouncement – The period of 90 days should be computed by excluding at least the period during which the lockdown due to Covid-19 was in force. [ITATR. 34(5) ]

Dy.CIT v JSW Ltd ( 2020) 116 taxmann.com 565 79 ITR 585 / 183 ITD 148/ 189 DTR 15/ 205 TTJ 1 ( Mum) (Trib) www.itatonline.org

Indian Partnership Act, 1932

S.37 : Rights of outgoing partner in certain cases to share subsequent profits – Retirement – Dissolution -Mode of settlement of accounts – When there are only two partners and one has agreed to retire, then the retirement amounts to dissolution of the firm . [ S.48 ]

There is a clear distinction between ‘retirement of a partner’ and ‘dissolution of a partnership firm’. On retirement of the partner, the reconstituted firm continues and the retiring partner is to be paid his dues in terms of Section 37 of the Partnership Act. In case of dissolution, accounts have to be settled and distributed as per the mode prescribed in Section 48 of the Partnership Act. When the partners agree to dissolve a partnership, it is a case of dissolution and not retirement A partnership firm must have at least two partners. When there are only two partners and one has agreed to retire, then the retirement amounts to dissolution of the firm . Accounts to be settled as it amounts to dissolution of firm . Trial Court was directed to pass the final decree in accordance with law .(CANOS. 6659 -6660 of 2010 dt 26 -5- 2020 ) Guru Nanak Industries v Amar Singh , Through LRS ( SC) www.itatonline.org .

Indian Contract Act , 1872 .

S.56 : Agreement to do impossible Act – An agreement to do an impossible Act is void -Doctrine of “Force Majeure” & “Frustration of Contract” – The effect of the doctrine of frustration is that it discharges all the parties from future obligations . [ Arbitration and Conciliation Act, 1996 .S 37 ]

South East Asia Marine v Oil India Ltd . AIR 2020 SC 2323; (2020) 5 SCC 164; MANU/SC/0441/2020 (SC. AIR 2020 SC 2323; (2020) 5 SCC 164; MANU/SC/0441/2020 (SC(SC) www.itatonline.prg

S. 254(2A): Appellate Tribunal –Stay- Video conferencing – Attachment of bank account lifted and stay against coercive recovery granted. [ S.226 (3) ]

Pandhes Infracon Pvt Ltd v ACIT ( 2020) 116 taxmann.com 376 (Mum) (Trib) www.itatonline.org Editorial : ITAT Mumbai created history by hearing a stay petition, on humane ground during period of complete lockdown, through video conferencing from home offices of Coram Members.