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. 41(1) : Profits chargeable to tax-Remission or cessation of trading liability-Hived off its hire purchase and leasing business to a special purpose vehicle (SPV)-Assigned corresponding receivables together with bank liabilities to SPV at book-Liable to repay-Not chargeable to tax-Bank claimed as bad debt-No outstanding due from Bank in the books of account-Addition cannot be made. [S. 145]

India Cements Capital Ltd. v. ACIT (2022) 196 ITD 127 / 220 TTJ 990 / (2023) 221 DTR 28 (Chennai)(Trib.)

S. 40A(3) : Expenses or payments not deductible-Cash payments exceeding prescribed limits-Civil contractor-Material purchase and labour payments-Payment in excess of Rs. 20,000-Failure to prove exception-Disallowance is justified. [S. 263, R. 6DD]

ACIT v. Bajrang Bahadur Singh (2022) 196 ITD 686 / 220 TTJ 19 (UO) (Varanasi)(Trib.)

S. 40A(2) : Expenses or payments not deductible-Excessive or unreasonable-Addition was deleted by CIT(A) in earlier year-Revenue has not challenged the order of earlier year-Addition was deleted. [S. 254(1)

Niche Health Options (P.) Ltd. v. (2022) 196 ITD 6 (Mum.)(Trib.)

S. 40(a)(ia) : Amounts not deductible-Deduction at source-Contribution to Turf Authorities of India for conducting an event-Meet expenditure-Not liable to deduct tax at source-Subsidies to promote horse racing-Failure to mention which section of TDS provision is applicable-Addition was deleted.

Mysore Race Club Ltd. v. ACIT (2022) 196 ITD 140 (Bang.)(Trib.)

S. 40(a)(i) : Amounts not deductible-Deduction at source-Non-resident-Advertisement services-Payment to Irish company-No Permanent Establishment in India-Not liable to deduct tax at source-DTAA-India-Irish. [S. 9(1)(i), 195, Art. 7]

ACIT v. Lenskart Solution (P.) Ltd. (2022) 196 ITD 297 (Delhi) (Trib.)

S. 37(1) : Business expenditure-Carrying on of business-No business activities during the year-Matter remanded.

DCIT v. NCR Business Park (P.) Ltd. (2022) 196 ITD 678 (Delhi) (Trib.)

S. 37(1) : Business expenditure-Loss on account of exchange difference-Allowable as deduction. [S. 28(i)]

Everest Industries Ltd. v. DCIT (2022) 196 ITD 563 (Mum.)(Trib.)

S. 37(1) : Business expenditure-Pre-operative expenses-Capital or revenue-Business of hotels, motels, catering etc.-Setting up business-Salaries and allowances to experts-Allowable as business expenditure.

RBL Hotels (P.) Ltd. v. ACIT (2022) 196 ITD 513 / (2023) 222 TTJ 706 / 220 DTR 233(Chennai)(Trib.)

S. 37(1) : Business expenditure-Fees-ROC-Capital or revenue-Debt restructuring-Increase in authorised capital and annual remuneration paid to monitoring institution under CDR-Allowable as revenue expenditure.

Spandana Sphoorty Financial Ltd. v. DCIT (2022) 196 ITD 217 / 217 TTJ 837 / 214 DTR 121 (Hyd.)(Trib.)

S. 37(1) : Business expenditure-Contribution to Temple, Panchayat-Allowable as business expenditure. [S. 80G]

Infrastructure Logistics (P.) Ltd. v. JCIT (2022) 196 ITD 153/(2023) 223 TTJ 341 (Panaji)(Trib.)