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. 145A : Method of accounting – Section 145A inserted w.e.f. April 1, 1999 are clarificatory in nature and would be applicable even for AYs prior to AY 1999-2000 – Excise duty has to be included in the value of closing stock of finished goods- Order of Tribunal is set aside. [S. 147]

CIT .v. Chhata Sugar Company Ltd. (2018) 171 DTR 330/ 307 CTR 63 /(2020) 424 ITR 276 (All)(HC)

S. 143(3) : Assessment-Hindu undivided family–Individual- Regardless of what an assessee claims, if the correct factual position is otherwise, the Assessing Officer has to adopt correct position-. Even if SM had filed returns in the status of ‘individual’ if the correct status is that of HUF, then there is no legal impediment for the legal heirs to claim that the succession was of the HUF. Tribunal was therefore right in law in holding that the status of the assessee was that of an HUF. [ S.2(31))(ii)]

CIT .v. Bhawani Singhji & Ors. (2018) 305 CTR 161 / 171 DTR 121 (Delhi)(HC)

S. 90 : Double taxation relief-Fees for technical services–Applicability of protocol–No separate notification required as protocol itself automatically applies of subsequent treaty with another OECD treaty (Finland)-DTAA-India–Netherland. [Art. 12]

Apollo Tyres Ltd. v. CIT (IT) (2018) 167 DTR 51 (Karn.)(HC)

S. 40(a)(ia) : Amounts not deductible -Deduction at source – Reimbursement of “shared services cost” to holding company – Reading of relevant clauses of agreement do not lead to inference that amount is paid on estimation- Not liable to deduct tax at source [ S.194C.]

CIT .v. ASK Wealth Advisors (P) Ltd. (2018) 168 DTR 349 (Bom.) (HC)

S. 32 : Depreciation – Unabsorbed depreciation- Set-off – For the AY 1997-98, the claim for set off of unabsorbed depreciation is allowable against the income from other sources – However, in AY 1998-99, set off of carry forward unabsorbed depreciation could be allowed only against the profits and gains arising from business or profession. [S. 28(i), 32(2), 56, 263]

CIT v. Cochin Shipyard Ltd. (2018) 305 CTR 439 / 168 DTR 140 (Ker.)(HC)

S. 12A : Registration–Trust or Institution-Merely because the charitable activity may mutually benefit members-Object itself would not cease to be charitable in nature. [S. 2 (15)]

CIT .v. Chhattisgarh Urology Society (2018) 303 CTR 299 / 166 DTR 114 (Chhattisgarh)(HC)

S. 10(23C) : Educational institution–Accumulation income-Educational purposes-Assessee-school’s utilization of the amount of receipts (exceeding one crore) for purchase of land for further extension of school building, is to be considered for educational purpose only, hence, exemption is eligible.[S.10(23C)(vi)]

CIT(E) v. Managing Committee, Arya High School (2018) 304 CTR 548 / 168 DTR 257 (P&H)(HC)

S.271(1)( c ): Penalty – Concealment – Undisclosed income surrendered during survey not included in the return- Tax was paid – Bonafide mistake – Deletion of penalty is held to be justified .[S.133A ]

ACIT v .Harbans lal sethi (2018)196 TTJ 23 (UO) /53 CCH 552 ( Jaipur ) (Trib)

S.68: Cash credits –Sale of car-Resale of car-Purchase was not doubted –On resale to from whom the car was purchased- Addition is held to be not justified .[ S.32 ]

ACIT v. Crayons Advertising Ltd. (2018) 68 ITR 77 (SN) (Delhi)(Trib)

S. 9(1)(vi) : Income deemed to accrue or arise in India – Royalty –Amount paid by AE for sale of software is not royalty -Right to use copy right –Matter remanded -DTAA-India –Belgium [ S.90 ,Art ,12(3) ]

Agfa Healthcare N.V. v Dy.CIT (2018) 172 DTR 153/196 TTJ 690 ( Mum) (Trib)