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. 43B : Certain deductions only on actual payment – Contributions to provident fund and employees’ state insurance – Contribution deposited beyond prescribed time limit provided in respective Acts but before due date of filing return under income tax Act is allowable.
DCIT v. Rajasthan Rajya Vidyut Utpadan Nigam Ltd.(2018) 63 ITR685 / 52 CCH 520 (Jaipur)(Trib.)
S. 37(1) : Business expenditure -Corporate entity – even if no business was carried out during the year, expenditure incurred by it has to be allowed.
Ozoneland Agro Pvt. Ltd. v. DCIT (2018)53 CCH 427 / 64 ITR 6 (SN)(Mum)(Trib.)www.itatonline.org
S. 36(1)(iii) : Interest on borrowed capital – AO cannot step into the shoes of the businessmen – Interest is allowable on borrowed funds used for the purpose of business.
DCIT v. Rajendra Bansilal Raisoni (2018) 66 ITR 655 / 53 CCH 606(Pune)(Trib.)
S. 32 : Depreciation – Injection moulding machine falls under the category of ‘Moulds’ and therefore shall qualify for higher rate of depreciation.
DCIT v SB Packaging Ltd. (2018) 63 ITR 569 / 52 CCH 511 (Delhi)(Trib.)
S. 32 : Depreciation – Depreciation is allowable non-compete territory rights – Department’s action of not filing an appeal against the CIT(A) favourable order in earlier year gives finality to the dispute.
DCIT v. Rasna Pvt Ltd (2018) 66 ITR 577 /53 CCH 0585 (Ahd.)(Trib.)
S. 14A : Disallowance of expenditure – Exempt income – No automatic disallowance can be made[ R.8D].
Siddhesh Capital Market Service v DCIT (2018) 52 CCH 003 (Mum.)(Trib.)
S. 14A : Disallowance of expenditure – Exempt income -Disallowance has to be made where the assessee cannot furnish any evidence to prove that the investments were made in earlier years.[ R. 8D]
Dy.CIT v. Rasna Pvt Ltd. ( No 2) (2018) 66 ITR 689 (Ahd.)(Trib.)
S. 10AA: Special economic zones -Assessee manufacturing different items in different units – No dispute about unit wise profitability declared by assesse – Remand report accepting cost of goods were reconciled – Addition made by AO to be deleted.
Dy.CIT v. Phoenix Lamps Ltd (2018)64 ITR 466/ 52 CCH 0576 (Delhi)(Trib.)
S. 9(1)(vi) : Income deemed to accrue or arise in India – Royalty – Consideration paid for copyrighted article is not royalty and hence cannot be brought to tax either under Act or under DTAA
Qualcomm Incorporated v. DDIT (2018) 65 ITR 248/52 CCH 0338 (Delhi) (Trib.)
S. 9(1)(vi) : Income deemed to accrue or arise in India – Royalty – Royalty income of assessee earned from OEMs situated outside India for the patents licensed to OEMs for manufacture of CDMA Network outside India was not chargeable to tax u/s 9(1)(vi)(c) .
Qualcomm Incorporated v. DDIT (2018) 65 ITR 248/ 52 CCH 0338 (Delhi) (Trib.)