Wednesday, October 6, 2010

ITR VOL 327 PART 4

INCOME TAX REPORTS (ITR)
Volume 327 : Part 4 (Issue dated 11-10-2010)

SUBJECT INDEX TO CASES REPORTED IN THIS PART

HIGH COURTS

Appeal to Commissioner (Appeals) --Power to admit additional evidence--Duty to allow Assessing Officer opportunity to examine additional evidence--Tribunal holding violation of rule for failure to allow Assessing Officer to cross-examine witnesses, but directing consideration of evidence dispensing with cross-examination--Not proper--Assessee to produce witnesses--Income-tax Rules, 1962, r. 46A-- CIT v. Subbu Shashank (Mad) . . . 577

Appeal to High Court --Competency of appeal--Monetary limit laid down in CBDT Circular--Binding on Revenue--Tax effect less than monetary limit--Appeal not maintainable--Income-tax Act, 1961, s. 260A--Circular 5 of 2008-- CIT v. Abhinash Gupta (P&H) . . . 619

Business expenditure --Disallowance--Salary and perquisites--Disallowance governed by first proviso to section 40A(5)(a) not section 40A(5)(c)--Income-tax Act, 1961, s. 40A(5)(a), (c)-- CIT v. Modi Industries Limited (Delhi) . . . 570

Cash credits --Share application money--Substantial evidence produced by assessee to prove creditworthiness of creditor and genuineness of share application--Failure to produce creditor not material--Deletion of addition--No interference--Income-tax Act, 1961, s. 68-- CIT v. Orbital Communication (P) Ltd. (Delhi) . . . 560

Commissioner --Revision--Non-consideration of appraisal report by Assessing Officer--Appraisal report essential for making assessment--Revision by Commissioner justified--Income-tax Act, 1961, s. 263-- CIT v. Daga Entrade P. Ltd. (Gauhati) . . . 467

Deduction of tax at source --Double taxation relief--Verification of certificates of tax deducted at source in two different countries--Letter informing assessee verification not practicable--Writ petition not maintainable--Income-tax Act, 1961, ss. 4, 5, 201(1A)--Constitution of India, art. 226-- V. Ganesh v. Asst. CIT (Mad) . . . 564

Depreciation --Initial depreciation--"Building", meaning of--New residential quarters--Initial depreciation allowable--Income-tax Act, 1961, s. 32(1)(iv)-- CIT v. Modi Industries Limited (Delhi) . . . 570

Income --Accrual of income--Sugar manufacturer realizing price in excess of that fixed by Government on condition excess would be refunded if its challenge failed--Excess amount a contingent receipt--Not taxable-- CIT v. Modi Industries Limited (Delhi) . . . 570

----Mutual association--Essence of mutuality--Complete identity between contributors and participators--Firm engaged in property development, commission agency and allied activities--Not a mutual association--Income of firm assessable--Income-tax Act, 1961-- Prabhashankar Plaza v. ITO (Karn) . . . 582

Income from undisclosed sources --Payment made to another assessee--Addition--Assessee failing to produce books of account--Finding that payment made out of undisclosed sources and addition proper--Findings of fact--Income-tax Act, 1961, s. 69-- Manak Chand Agarwal v. CIT (P&H) . . . 486

Income-tax survey --Statement made at time of survey not conclusive--Undisclosed money--Retraction of statement at time of assessment found bona fide by Commissioner (Appeals)--Explanation for failure to write up books for two and a half years accepted by Commissioner (Appeals) and additions deleted--Tribunal affirming on ground no defect found in books and material available with assessee for writing up books primary evidence--Findings of fact--Income-tax Act, 1961, ss. 69, 69A, 133A-- ITO v. Vijay Kumar Kesar (Chhattisgarh) . . . 497

Industrial undertaking --Special deduction under section 80-IA--Condition precedent--Profit must be "derived" from industrial undertaking--Meaning of "derived"--Freight subsidy received from Government--Not derived from industrial undertaking--Not entitled to be taken into account for computing special deduction under section 80-IA--Income-tax Act, 1961, s. 80-IA-- CIT v. Kiran Enterprises (HP) . . . 520

----Special deduction--Benefit allowed in three preceding years--Assessee entitled to deduction for following year--Income-tax Act, 1961, s. 80J-- CIT v. Modi Industries Limited (Delhi) . . . 570

Interest-tax --Charge of tax--Financial company--Definition--Leasing business--Difference between financial lease and operational lease--Company carrying on financial lease would be chargeable to tax--Matter remanded--Interest-tax Act, 1974, s. 2(5B)-- CIT v. Motor and General Finance Ltd. (Delhi) . . . 530

Offences and prosecution --Wilful attempt to evade tax--Prosecution can continue even where penalty set aside by Tribunal--Where trial has commenced court will not quash prosecution--Prosecution not to be postponed till decision in compounding proceedings--Income-tax Act, 1961, ss. 273A(4), 276C, 277, 278--Indian Penal Code, 1860, ss. 120B, 193, 196, 420, 511-- N. Athimoolam v. ITO (Mad) . . . 603

Penalty --Concealment of income--Appellate Tribunal--Power to remand--Adequate material not available before Assessing Officer for conclusive determination of issue--Tribunal remanding matter for fresh disposal--Cannot be interfered with--Income-tax Act, 1961, s. 271(1)(c)-- Kamakhya Photo Lab P. Ltd. v. CIT (Gauhati) . . . 565

----Concealment of income--Claim for deduction not bona fide--Amounts to concealment of income--Accounts showing deduction of income-tax and equipment written off--Not allowable deductions--Assessee a company with professional assistance in computing income--Assessee had concealed its income--Liable to pay penalty--Income-tax Act, 1961, s. 271(1)(c)-- CIT v. Zoom Communication P. Ltd. (Delhi) . . . 510

----Concealment of income--Companies--Book profits--Total income computed under regular provisions less than book profits--Assessment made under section 115JB--Penalty cannot be levied--Income-tax Act, 1961, ss. 115JB, 271(1)(c)-- CIT v. Nalwa Sons Investments Ltd . (Delhi) . . . 543

----Concealment of income--Value of property assessed as unexplained investment--Rejection of explanation regarding source of funds for acquisition of property--No proof of concealment of income--Penalty could not be levied--Income-tax Act, 1961, s. 271(1)(c)-- S. V. Kalyanam v. ITO (Mad) . . . 477

Search and seizure --Block assessment--Return--Delay in filing--Interest--Before expiry of time limit assessee seeking copies of documents seized for purpose of filing return--Department delaying supply of copies by over a year--Assessee filing return within forty-five days thereafter--Not to be exonerated from liability to interest--Time taken by Department to supply documents to be excluded from total period reckoned from date of notice--Interest chargeable for delay exceeding forty five days--Income-tax Act, 1961, s. 158BFA(1)-- CIT v. Mesco Airlines Ltd. (Delhi) . . . 554

Total income --Inclusions--Transfer of assets--Transfer of asset to trust for benefit of daughter-in-law and grandchildren of assessee--No direct or indirect transfer to son's wife or grandchildren--Trust an independent legal entity and trustee legal owner of trust property--Income from trust not includible in income of assessee--Income-tax Act, 1961, s. 64(1)(vi)-- CIT v. Smt. Pushpawati (Delhi) . . . 490

Unexplained investment --Scope of section 69--Section 69 confers discretion on income-tax authorities--Assessee applying for tax clearance certificate--Explanation that property owned jointly with spouse and that his spouse and son contributed to purchase--Tribunal not right in not considering explanation--Value of property not assessable as unexplained investment--Income-tax Act, 1961, ss. 69, 230A-- S. V. Kalyanam v. ITO (Mad) . . . 477

Wealth-tax --Reassessment--Grounds for reassessment--Report of Valuation Officer--Report called for after completion of assessment--Not a ground for reassessment--Report called for during pendency of assessment but received after completion of assessment--Valid ground for reassessment--Wealth-tax Act, 1957, ss. 16, 16A, 17-- CWT v. Sona Properties P. Ltd. (Bom) . . . 592

Words and phrases --Meaning of "derived"-- CIT v. Kiran Enterprises (HP) . . . 520

 

SECTIONWISE INDEX TO CASES REPORTED IN THIS PART

Constitution of India :

Art. 226 --Deduction of tax at source--Double taxation relief--Verification of certificates of tax deducted at source in two different countries--Letter informing assessee verification not practicable--Writ petition not maintainable-- V. Ganesh v. Asst. CIT (Mad) . . . 564

Income-tax Act, 1961 :

S. 4 --Deduction of tax at source--Double taxation relief--Verification of certificates of tax deducted at source in two different countries--Letter informing assessee verification not practicable--Writ petition not maintainable-- V. Ganesh v. Asst. CIT (Mad) . . . 564

S. 5 --Deduction of tax at source--Double taxation relief--Verification of certificates of tax deducted at source in two different countries--Letter informing assessee verification not practicable--Writ petition not maintainable-- V. Ganesh v. Asst. CIT (Mad) . . . 564

S. 32(1)(iv) --Depreciation--Initial depreciation--"Building", meaning of--New residential quarters--Initial depreciation allowable-- CIT v. Modi Industries Limited (Delhi) . . . 570

S. 40A(5)(a), (c) --Business expenditure--Disallowance--Salary and perquisites--Disallowance governed by first proviso to section 40A(5)(a) not section 40A(5)(c)-- CIT v. Modi Industries Limited (Delhi) . . . 570

S. 64(1)(vi) --Total income--Inclusions--Transfer of assets--Transfer of asset to trust for benefit of daughter-in-law and grandchildren of assessee--No direct or indirect transfer to son's wife or grandchildren--Trust an independent legal entity and trustee legal owner of trust property--Income from trust not includible in income of assessee-- CIT v. Smt. Pushpawati (Delhi) . . . 490

S. 68 --Cash credits--Share application money--Substantial evidence produced by assessee to prove creditworthiness of creditor and genuineness of share application--Failure to produce creditor not material--Deletion of addition--No interference-- CIT v. Orbital Communication (P) Ltd. (Delhi) . . . 560

S. 69 --Income from undisclosed sources--Payment made to another assessee--Addition--Assessee failing to produce books of account--Finding that payment made out of undisclosed sources and addition proper--Findings of fact-- Manak Chand Agarwal v. CIT (P&H) . . . 486

----Income-tax survey--Statement made at time of survey not conclusive--Undisclosed money--Retraction of statement at time of assessment found bona fide by Commissioner (Appeals)--Explanation for failure to write up books for two and a half years accepted by Commissioner (Appeals) and additions deleted--Tribunal affirming on ground no defect found in books and material available with assessee for writing up books primary evidence--Findings of fact-- ITO v. Vijay Kumar Kesar (Chhattisgarh) . . . 497

----Unexplained investment--Scope of section 69--Section 69 confers discretion on income-tax authorities--Assessee applying for tax clearance certificate--Explanation that property owned jointly with spouse and that his spouse and son contributed to purchase--Tribunal not right in not considering explanation--Value of property not assessable as unexplained investment-- S. V. Kalyanam v. ITO (Mad) . . . 477

S. 69A --Income-tax survey--Statement made at time of survey not conclusive--Undisclosed money--Retraction of statement at time of assessment found bona fide by Commissioner (Appeals)--Explanation for failure to write up books for two and a half years accepted by Commissioner (Appeals) and additions deleted--Tribunal affirming on ground no defect found in books and material available with assessee for writing up books primary evidence--Findings of fact-- ITO v. Vijay Kumar Kesar (Chhattisgarh) . . . 497

S. 80-IA --Industrial undertaking--Special deduction under section 80-IA --Condition precedent--Profit must be "derived" from industrial undertaking--Meaning of "derived"--Freight subsidy received from Government--Not derived from industrial undertaking--Not entitled to be taken into account for computing special deduction under section 80-IA-- CIT v. Kiran Enterprises (HP) . . . 520

S. 80J --Industrial undertaking--Special deduction--Benefit allowed in three preceding years--Assessee entitled to deduction for following year-- CIT v. Modi Industries Limited (Delhi) . . . 570

S. 115JB --Penalty--Concealment of income--Companies--Book profits--Total income computed under regular provisions less than book profits--Assessment made under section 115JB--Penalty cannot be levied-- CIT v. Nalwa Sons Investments Ltd .(Delhi) . . . 543

S. 133A --Income-tax survey--Statement made at time of survey not conclusive--Undisclosed money--Retraction of statement at time of assessment found bona fide by Commissioner (Appeals)--Explanation for failure to write up books for two and a half years accepted by Commissioner (Appeals) and additions deleted--Tribunal affirming on ground no defect found in books and material available with assessee for writing up books primary evidence--Findings of fact-- ITO v. Vijay Kumar Kesar (Chhattisgarh) . . . 497

S. 158BFA(1) --Search and seizure--Block assessment--Return--Delay in filing--Interest--Before expiry of time limit assessee seeking copies of documents seized for purpose of filing return--Department delaying supply of copies by over a year--Assessee filing return within forty-five days thereafter--Not to be exonerated from liability to interest--Time taken by Department to supply documents to be excluded from total period reckoned from date of notice--Interest chargeable for delay exceeding forty five days-- CIT v. Mesco Airlines Ltd. (Delhi) . . . 554

S. 201(1A) --Deduction of tax at source--Double taxation relief--Verification of certificates of tax deducted at source in two different countries--Letter informing assessee verification not practicable--Writ petition not maintainable-- V. Ganesh v. Asst. CIT (Mad) . . . 564

S. 230A --Unexplained investment--Scope of section 69--Section 69 confers discretion on income-tax authorities--Assessee applying for tax clearance certificate--Explanation that property owned jointly with spouse and that his spouse and son contributed to purchase--Tribunal not right in not considering explanation--Value of property not assessable as unexplained investment-- S. V. Kalyanam v. ITO (Mad) . . . 477

S. 260A --Appeal to High Court--Competency of appeal--Monetary limit laid down in CBDT Circular--Binding on Revenue--Tax effect less than monetary limit--Appeal not maintainable--Circular 5 of 2008-- CIT v. Abhinash Gupta (P&H) . . . 619

S. 263 --Commissioner--Revision--Non-consideration of appraisal report by Assessing Officer--Appraisal report essential for making assessment--Revision by Commissioner justified-- CIT v. Daga Entrade P. Ltd. (Gauhati) . . . 467

S. 271(1)(c) --Penalty--Concealment of income--Appellate Tribunal--Power to remand--Adequate material not available before Assessing Officer for conclusive determination of issue--Tribunal remanding matter for fresh disposal--Cannot be interfered with-- Kamakhya Photo Lab P. Ltd. v. CIT (Gauhati) . . . 565

----Penalty--Concealment of income--Claim for deduction not bona fide--Amounts to concealment of income--Accounts showing deduction of income-tax and equipment written off--Not allowable deductions--Assessee a company with professional assistance in computing income--Assessee had concealed its income--Liable to pay penalty-- CIT v. Zoom Communication P. Ltd. (Delhi) . . . 510

----Penalty--Concealment of income--Companies--Book profits--Total income computed under regular provisions less than book profits--Assessment made under section 115JB--Penalty cannot be levied-- CIT v. Nalwa Sons Investments Ltd . (Delhi) . . . 543

----Penalty--Concealment of income--Value of property assessed as unexplained investment--Rejection of explanation regarding source of funds for acquisition of property--No proof of concealment of income--Penalty could not be levied-- S. V. Kalyanam v. ITO (Mad) . . . 477

S. 273A(4) --Offences and prosecution--Wilful attempt to evade tax--Prosecution can continue even where penalty set aside by Tribunal--Where trial has commenced court will not quash prosecution--Prosecution not to be postponed till decision in compounding proceedings-- N. Athimoolam v. ITO (Mad) . . . 603

S. 276C --Offences and prosecution--Wilful attempt to evade tax--Prosecution can continue even where penalty set aside by Tribunal--Where trial has commenced court will not quash prosecution--Prosecution not to be postponed till decision in compounding proceedings-- N. Athimoolam v. ITO (Mad) . . . 603

S. 277 --Offences and prosecution--Wilful attempt to evade tax--Prosecution can continue even where penalty set aside by Tribunal--Where trial has commenced court will not quash prosecution--Prosecution not to be postponed till decision in compounding proceedings-- N. Athimoolam v. ITO (Mad) . . . 603

S. 278 --Offences and prosecution--Wilful attempt to evade tax--Prosecution can continue even where penalty set aside by Tribunal--Where trial has commenced court will not quash prosecution--Prosecution not to be postponed till decision in compounding proceedings-- N. Athimoolam v. ITO (Mad) . . . 603

Indian Penal Code, 1860 :

Ss. 120B, 193, 196, 420, 511 --Offences and prosecution--Wilful attempt to evade tax--Prosecution can continue even where penalty set aside by Tribunal--Where trial has commenced court will not quash prosecution--Prosecution not to be postponed till decision in compounding proceedings-- N. Athimoolam v. ITO (Mad) . . . 603

Interest-tax Act, 1974 :

S. 2(5B) --Interest-tax--Charge of tax--Financial company--Definition--Leasing business--Difference between financial lease and operational lease--Company carrying on financial lease would be chargeable to tax--Matter remanded-- CIT v. Motor and General Finance Ltd. (Delhi) . . . 530

Wealth-tax Act, 1957 :

Ss. 16, 16A, 17 --Wealth-tax--Reassessment--Grounds for reassessment--Report of Valuation Officer--Report called for after completion of assessment--Not a ground for reassessment--Report called for during pendency of assessment but received after completion of assessment--Valid ground for reassessment-- CWT v. Sona Properties P. Ltd. (Bom) . . . 592

Income-tax Rules, 1962 :

R. 46A --Appeal to Commissioner (Appeals)--Power to admit additional evidence--Duty to allow Assessing Officer opportunity to examine additional evidence--Tribunal holding violation of rule for failure to allow Assessing Officer to cross-examine witnesses, but directing consideration of evidence dispensing with cross-examination--Not proper--Assessee to produce witnesses-- CIT v. Subbu Shashank (Mad) . . . 577




--
Me on net :
> >>>>>>>>>>>>>>>>>>>>>
http://rajkumaratthenet.blogspot.com/
http://itronline.blogspot.com/

Virus Warning: Although the I have taken reasonable precautions to ensure no viruses are present in his email, sender (I) cannot accept responsibility for any loss or damage arising from the use of this email or attachment."

No comments:

Post a Comment