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. 143(3) : Assessment- Overdue interest-Provisions for bad and doubtful debts – Schedule bank – Interest income on NPAs is taxable on receipt basis and not on accrual basis. [S.4,28(i), 36, 37 (1)]
ACIT v. The Guntur Co-operative Central Bank (2018) 193 TTJ 870 / 166 DTR 280 (Visakha.) (Trib.)
S. 92C : Transfer pricing – Arms’ length price – Profit Split Method can be adopted as most appropriate method in cases involving multiple inter-related international transactions which cannot be evaluated separately.
Google India (P.) Ltd. v Jt. DIT(IT) (2018) 194 TTJ 385 (Bang.)(Trib.)
S. 68: Cash credits – Mere non-production of directors of Creditor Company cannot justify addition when detailed evidences filed.
Gopal Forex Pvt. Ltd. v. ITO (2018) 66 ITR 226 (Delhi) (Trib.)
S. 68 : Cash credits – Bogus purchase – Liability pursuant to purchase and corresponding stock declared in books – No case of under assessment and no bogus liability to make addition[ S.143(3)]
Grandhi Sri Venkata Amarendra v. ACIT (2018) 66 ITR 66 (SN) (Visakha.)(Trib.)
S. 50C : Capital gains – Full value of consideration – Stamp valuation – Disputed valuation adopted by stamp duty authorities before AO – AO is required to refer the matter of valuation to Valuation Officer.[ S.45 ]
Harphool Jat v. ITO (2018) 66 ITR 7(SN)(Jaipur)(Trib)
S. 37(1) : Business expenditure – Making charges paid to Goldsmiths allowable as the Assessee offered to tax the making charges collected from customers.
Grandhi Sri Venkata Amarendra v. ACIT (2018) 66 ITR 66 (SN) (Visakha.)(Trib.)
S. 36(1)(iii) : Interest on borrowed capital – Disallowance cannot be made as Assessee established that loan advanced at interest lower than interest paid on unsecured loans out of interest free funds.
Grandhi Sri Venkata Amarendra v. ACIT (2018) 66 ITR 66 (SN) (Visakha.)(Trib.)
S. 32 : Depreciation -Building – Partly used for business – Depreciation on Building is disallowable in proportion of let out to total constructed area of the building. [S. 38]
Gold Seal Engineering Products P. Ltd. v. ACIT (2018) 66 ITR 37 (SN) (Mum.) (Trib.)
S. 14A : Disallowance of expenditure – Exempt income – Disallowance cannot exceed exempt income notwithstanding Assessee’s suo-motu disallowance is more than exempt income. [ R.8D ]
Gold Seal Engineering Products P. Ltd. v. ACIT (2018) 66 ITR 37 (SN)(Mum.) (Trib.)
S. 9(1)(vi) : Income deemed to accrue or arise in India – Royalty – Distributor/reseller agreement and service agreement for support to end users and after sales services have to be read together to examine nature of income – Access to trademarks, intellectual property, technical knowhow, derivative works, brand features, confidential information, etc., while discharging its obligation under both agreements – Amount payable under distributor/reseller agreement was ‘Royalty’ -DTAA- India – Ireland . [S. 195, 201, Art. 12]
Google India (P.) Ltd. v. Jt. DIT(IT) (2018) 194 TTJ 385 (Bang.) (Trib.) Editorial : Refer Google India Private Ltd v. CIT (2021)435 ITR 284 / 201 DTR 129/ 320 CTR 622 (Karn) (HC) ,Google Ireland Limited v. CIT (2021)435 ITR 284 / 201 DTR 129/ 320 CTR 622 (Karn) (HC) , PCIT v. Google India Private Ltd. (2021)435 ITR 284/ 201 DTR 129/ 320 CTR 622 (Karn) (HC) , High Court set aside the order of Tribunal .