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. 56 : Income from other sources–Share premium-Fair market value of shares (FMV)- Discounted Cash Flow (DCF)–Book value- Consistently followed the method valuing the shares at discounted cash flow- Share premium cannot be taxed -Addition is deleted. [S. 56(2)(viib), R.11UA]
ACIT v. Enterprises Business Solutions (P.) Ltd. (2019) 176 ITD 324/ 200 TTJ 268 / 179 DTR 321 (Asr.)(Trib.)
S. 54F : Capital gains-Investment in a residential house–Full value of consideration-No requirement that sale proceeds alone is to be utilised for making deposit in capital gains scheme-Only one house property as on date of sale of plots-only net consideration is required to be appropriated towards purchase of new asset. [S. 45, 48, 50C]
Sabita Devi Agarwal (Smt.) v. ITO (2019) 69 ITR 231 (Kol.)(Trib.)
S. 54 : Capital gains-Profit on sale of property used for residence– Deposit in Capital gain account scheme-Payment to developer within prescribed time-Possession was not obtained-Consumer Redressal Commission had put stay on developer-Exemption cannot be denied-Amount deposited in capital gain account also cannot be taxed though the amount was not utilised with in specified time limit. [S. 45, 54(2)]
Bal Kishan Atal. v. ACIT (2019) 176 ITD 330 (Delhi)(Trib.)
S. 54 : Capital gains-Profit on sale of property used for residence- -Investment in purchase of new residential property up to date of filing of his revised return- Entitle to exemption. [S. 139(5)]
Rajendra Pal Verma v. ACIT (2019) 176 ITD 211/ 178 DTR 169/ 199 TTJ 873 (Mum.)(Trib.)
S. 45 : Capital gains-Business income-Shares held as investment–Recorded as investment in the books of account at the time of purchase and from year to year–Sale consideration cannot be assessable as business income.[S. 28(i)]
Unitech Ltd. v. DCIT (2019) 176 ITD 266 (Delhi)(Trib.)
S. 41(1) : Profits chargeable to tax-Remission or cessation of trading liability–Waiver of interest and LIC guarantee fee-Not claimed as deduction in earlier years-Addition cannot be made– Adjustment of carry forward of losses and depreciation-Matter remanded to CIT(A) for read judication.
Fertilizer corporation of India Ltd. v. ACIT (2019) 69 ITR 183 (Delhi)(Trib.)
S. 40(a)(ia) : Amounts not deductible-Deduction at source–Hiring charges for use of cranes–Payment being not contractual – Not liable to deduct tax at source. [S. 194C]
Bhangal Construction Co. v. ITO (2019) 176 ITD 419 (Asr.)(Trib.)
S. 40(a)(ia) : Amounts not deductible-Deduction at source-Contractor-PAN of transporters at time of payment of freight was collected–Disallowance cannot be made. [S. 194C(6), 194C(7)]
ACIT v. Arihant Trading Co. (2019) 176 ITD 397 (Jaipur) (Trib.)
S. 37(1) : Business expenditure-Prior period expenses–Method of accounting -Bills received during the year–Liability crystallised during the year–Allowable as deduction. [S. 145]
Unitech Ltd. v. DCIT (2019) 176 ITD 266 (Delhi) (Trib.)
S. 37(1) : Business expenditure–Interest-Commercial expediency –Unrelated parties-Payment was made as part of contract– Disallowances cannot be made. [S. 36(1)(iii)]
Unitech Ltd. v. DCIT (2019) 176 ITD 266 (Delhi)(Trib.)