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. 69A : Unexplained money – Search and seizure-illegal capitation fees –Addition on estimate basis is held to be justified.

Arvind Janardhan Pandey v. ITO (2019) 262 Taxman 401 (Bom.)(HC)

S. 68 : Cash credits-Shares at a premium-Genuineness, creditworthiness and identity of investors are established-Addition cannot be made as cash credit.

PCIT v. Chain House International (P.) Ltd. ( 2018) 98 taxmann.com 47 / (2019) 408 ITR 561(MP) (HC),Rohtak Chain Co ( P) Ltd ; PCIT v (2019) 408 ITR 561 (MP) (HC)/Bharat Securities Ltd ; PCIT v. (2019) 408 ITR 561 (MP) (HC) Editorial: SLP of revenue is dismissed, PCIT v. Chain House International (P.) Ltd. (2019) 262 Taxman 207 (SC)/,PCIT v. Bharat Securities (P) Ltd ( 2020) 268 Taxman 394 (SC)

S. 50C : Capital gains-Full value of consideration- stamp valuation-
Without hearing objections of assessee, that Fair Market Value of capital asset as per ‘Guidance Value’ can not be determined by authorities- Matter remanded to the Assessing Officer. [S. 45, 48 , 50C (2)],

Jagannathan Sailaja Chitta v. ITO (2019) 417 ITR 61 / 262 Taxman 427/ 308 CTR 713/ 178 DTR 33 (Mad.) (HC)

S. 45(4) : Capital gains – Distribution of capital asset – Retirement of partner- Amount received by a partner on her retirement from a partnership firm is not liable to capital gain tax. [S. 45]

Hemlata S. Shetty (Smt.) v. ACIT (2019) 262 Taxman 324 (Bom.) (HC)

S. 45 : Capital gains-Transfer-Joint Development agreement (JDA)-In the absence of registration agreement did not fall under S.53A of the transfer of property Act–Not liable to capital gains tax [S. 2(47)(v) Transfer of Property Act, 1882 S. 53A]

P CIT v. Chuni Lal Bhagat. (2019) 103 taxmnn.com 378 /262 Taxman 210 (P & H) (HC) Editorial: SLP of revenue is dismissed, PCIT v. Chuni Lal Bhagat. (2019) 262 Taxman 209 (SC)

S. 41(1) : Profits chargeable to tax-Remission or cessation of trading liability-Timber business-Discontinuation of business for more than 10 years-Showing the creditors- Application of common sense principles-Burden of proof on assessee to show subsistence of liability-Liable to be taxed as profits of business.

West Asia Exports & Imports (P.) Ltd. v. ACIT (2019) 412 ITR 208 / 262 Taxman 372 / 177 DTR 201/ 309 CTR 353(Mad.)(HC)

S. 40A(3) : Expenses or payments not deductible – Cash payments exceeding prescribed limits – Purchase of jewellery – failure to demonstrate a situation which compelled to make payment in cash- Disallowance is held to be justified.

Natesan Krishnamurthy v. ITO (2019) 262 Taxman 127/ 178 DTR 177 (Mad.)(HC)/Editorial : SLP dismissed .Natesan Krishnamurthy v. ITO (2025) 476 ITR 12 /304 Taxman 592 (SC)

S. 40A(2) : Expenses or payments not deductible–Excessive or unreasonable–Salaries to directors- Preceding year was accepted by revenue–No extraordinary increase in salary-Disallowance is held to be not justified.

PCIT v. Patel Alloy Steel Co. (P.) Ltd. (2019) 103 taxmnn.com 431/ 262 Taxman 167 (Guj.) (HC) Editorial: SLP of revenue is dismissed, PCIT v. Patel Alloy Steel Co. (P.) Ltd. (2019) 262 Taxman 166 (SC)

S. 40(a)(i) : Amounts not deductible-Deduction at source-Non-resident–Payments made to foreign law firms as consultancy fee which did not have any fixed base in India-Not taxable in India-Not liable to deduct tax at source.[S. 9(1)(i), 195]

PCIT v. Cadila Healthcare Ltd. (2019)104 taxmann.com 78/ 262 Taxman 301 (Guj.)(HC) Editorial: SLP of revenue is dismissed, PCIT v. Cadila Healthcare Ltd. (2019) 262 Taxman 301 (SC)

S. 37(1) : Business expenditure–Non-compete fee paid by assessee to founder of transferor company constituted business expenditure.

ITO v. Smartchem Technologies Ltd. (2019) 103 taxmann.com 359 /262 Taxman 192 (Guj) (HC) Editorial: SLP of revenue is allowed, ITO v. Smartchem Technologies Ltd. (2019) 262 Taxman 191 (SC)