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-Turnover tax-Liberty to assessee to prove that no deduction claimed for earlier assessment years-Direction to Assessing Officer to rectify assessment order. [S. 43B, Art. 136]

Ishwardas Sons v. CIT (2022) 447 ITR 755/ 220 DTR 94 /329 CTR 689 / 289 Taxman 620(SC)

S. 40(a)(ia) : Amounts not deductible-Deduction at source-Remuneration to director-Shortfall in tax deduction at source-No disallowance can be made-Proper course of action is invoke section 201 of the Act. [S. 37(1), 40A(2)(b), 197(1), 201]

PCIT v. Future First Info. Services Pvt. Ltd. (2022)447 ITR 299/(2023) 290 Taxman 490 (Delhi)(HC)

S. 37(1) : Business expenditure-Expenditure prohibited by law-Amounts paid by Hospitals as referrals to Doctors-Not deductible-Interpretation of taxing statutes-Interpretation taking into account intention of legislature-Reassessment notice was quashed. [S. 147, 148, Art. 226, General Clauses Act, 1897, S. 2(38), Indian Penal Code, 1860, S. 43, Medical Council (Professional Conduct, Etiquette and Ethics) Regulations, 2002, R. 6.8]

Peerless Hospitex Hospital and Research Center Ltd. v. PCIT (2022) 447 ITR 60 / 326 CTR 249 / 213 DTR 81 / 287 Taxman 711 (Cal.)(HC)

S. 37(1) : Business expenditure-Capital or revenue-Expenditure on improvements in leased premises to run fast food business-Allowable as revenue expenditure.

PCIT v. Jubilant Foodworks Ltd. (2022) 447 ITR 29 (All.)(HC) Editorial : Dy. CIT v. Jubilant Foodworks Ltd. (2022) 93 ITR 1 (Delhi)(Trib), affirmed.

S. 37(1) : Business expenditure-Books of account and documents in custody of Central Bureau of Investigation-Assessing Officer has power and duty to requisition documents from another Public Authority-Disallowance of expenditure is not valid-Findings of Tribunal cannot be interfered with unless perverse or illegal. [S. 131, 260A]

PCIT. v. Ennoble Construction (2022) 447 ITR 444 / 220 DTR 95 / 329 CTR 923(Karn.)(HC)

S. 37(1) : Business expenditure-Capital or revenue-Owner of Hotel-Compensation paid towards termination of agreement to receive back possession of building, furniture and fixtures-Allowable as revenue expenditure.

PCIT v. Elel Hotels and Investments Ltd. (2022) 447 ITR 92/ 220 DTR 478/(2023) 332 CTR 870 (Delhi)(HC) Editorial : Order of Tribunal in PCIT v. Elel Hotels and Investments Ltd. (2022) 28 ITR (Trib)-OL 616 (Delhi)(Trib.), affirmed.

S. 37(1) : Business expenditure-Pre-paid expenses or advance payments-Entitled to claim expenses in year in which incurred.

PCIT v. Apollo Tyres Ltd. (No. 3) (2022) 447 ITR 431 (Ker.)(HC)

S. 37(1) : Business expenditure-Loss on foreign exchange forward contracts-Allowable as revenue expenditure.

PCIT v. Apollo Tyres Ltd. (No. 2) (2022) 447 ITR 403 (Ker.)(HC)

S. 37(1) : Business expenditure-Capital or revenue-Expansion of existing business-Expenditure on setting up new unit-Expenditure on feasibility study-Loan Processing fee and bank charges-Revenue expenditure.

PCIT v. Apollo Tyres Ltd. (No. 2) (2022)447 ITR 403 (Ker.)(HC) PCIT v. Apollo Tyres Ltd. (No. 3) (2022)447 ITR 431 (Ker.)(HC)

S. 37(1) : Business expenditure-Debenture at premium-Liability to be spread over period covered by debentures. [S. 145]

CIT v. Apollo Tyres Ltd. (No. 1) (2022) 447 ITR 377 (Ker.)(HC)