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. 48 : Capital gains-Computation-Cost of acquisition-Indexation cost-Joint Development agreement-Accounting treatment in books of account cannot determine the taxability under income-tax Act-Indexed cost of acquisition-Indexation was allowed till the taxable event of capital gains and not till the date of entering in to development agreement with developer-Provision of section 45(2) cannot be applicable to the assessee who is not a developer. [S 45, 45(2), 145]

Global Health (P.) Ltd. v. DCIT (2021) 191 ITD 279 (Delhi)(Trib.)

S. 48 : Capital gains-Computation-Assignment of rights-No consideration was received from lessor-Not taxable as capital gains. [S. 45]

InterGlobe Aviation Ltd. (IndiGo) v. ACIT (2021) 191 ITD 1/(2022) 216 TTJ 265 / 95 ITR 586/ 211 DTR 233(SB) (Delhi)(Trib.)

S. 45(5A) : Capital gains-Joint development agreement-Ready reckoner value-Actual consideration-Fair market value-Value of consideration shown as per agreement has to be accepted-Provision of section 45(5A)) cannot be made applicable for the Assessment year 2015-16. [S. 45, 48, 50C]

Amit Vishnu Pashankar v. DCIT (2021) 191 ITD 576 (Pune) (Trib.)

S. 45 : Capital gains-Land dealings-Stock in trade-Shown as investment for seven years-Assessable as capital gains and not as business income. [S. 2(13), 28(i)]

JCIT v. Adrus Estate and Properties LLP. (2021) 191 ITD 166 / 213 TTJ 1 (UO) (Pune)(Trib.)

S. 43(6) : Written down value-Block of assets-Waiver of loan-Asset purchased in earlier year-Written back from capital reserve-No adjustment can be made. [S. 2(11), 2(24)(xviii), 32, 41(1), 43 (1)]

Shapers India (P.) Ltd. v. DCIT (2021) 191 ITD 700/ 214 TTJ 238 / 206 DTR 303 (Pune) (Trib.)

S. 41(1) : Profits chargeable to tax-Remission or cessation of trading liability-Presumptive taxation-Remission of income tax liability of employees borne by assessee pertaining to earlier years-Not chargeable to tax-Claimed deduction and allowed-The income would be chargeable to tax-Matter remanded. [S.44BB(2)]

Dolphin Drilling Ltd. v. DCIT (IT) (2021) 191 ITD 181 / 204 DTR 209 / 212 TTJ 662 (Dehradun)(Trib.)

S. 41(1) : Profits chargeable to tax-Remission or cessation of trading liability-Sundry creditors-Not claimed as deduction in earlier years-Addition cannot be made.

Ravindra Arunachala Nadar v. ACIT (2021) 191 ITD 520 (Chennai)(Trib.)

S. 41(1) : Profits chargeable to tax-Remission or cessation of trading liability-Payment was not made due to supply of inferior quality goods-Recovery of proceedings were pending-Addition cannot be made as cessation of liability.

Dy. CIT v. Surbhit Impex (P.) Ltd. (2021) 191 ITD 711 / 206 DTR 105 / 214 TTJ 406 (Mum.)(Trib.)

S. 40A(2) : Expenses or payments not deductible-Excessive or unreasonable-Consultancy and technical services from sister concern-Disallowance was restricted only t0 10 per cent of total expenses.

Bright Enterprises (P.) Ltd. v. DCIT (2021) 191 ITD 740 / 90 ITR 394 (Amritsar)(Trib.)

S. 40(a)(ii) : Amounts not deductible-Rates or tax-Education cess is not income tax-Allowable deduction. [S. 37(1)]

ACIT v. India Power Corporation Ltd. (2021) 191 ITD 250 (Kol.)(Trib.)/Tasty Bite Eatables Ltd v .ACIT (2021) 89 ITR 699/ 214 TTJ 643 (Pune) (Trib)