Saturday, April 13, 2013

ITR Volume 351 Part 5 (Issue dated 25-3-2013)

INCOME TAX REPORTS (ITR) Volume 351 Part 5 (Issue dated 25-3-2013)

SUBJECT INDEX TO CASES REPORTED IN THIS PART

SUPREME COURT

Right to information --Exemption from disclosure--Invasion of privacy of individual--Return of income--Information found in income-tax return--Personal and exempt--No case of public interest in disclosure made out--Information not to be disclosed--Right to Information Act, 2005, s. 8(1)(j)-- Girish Ramchandra Deshpande v . Central Information Commissioner . . . 472

HIGH COURTS

Advance tax --Interest--Notice of demand--No direction in assessment order for charging interest--Notice of demand cannot be issued levying interest under section 234B--Income-tax Act, 1961, ss. 143(3), 156, 234B-- CIT v . Dehradun Club Ltd .
(Uttarakhand) . . . 396

Appeal to High Court --Competency of appeal--Circular prescribing monetary limits for appeals by Department--Net tax effect less than prescribed limit--Appeal not maintainable--Income-tax Act, 1961, s. 260A-- ITO v . Ramdas Alva (Karn) . . . 471

Business expenditure --Lease rent--Hire of machinery by assessee--Ownership of machinery remaining with lessor--Assessee having no right to transfer or alienate machinery and obliged to re-deliver equipment upon termination of lease agreement--Agreements accepted as real and genuine--Lease rentals paid on hired machinery allowable as business expenditure--Income-tax Act, 1961, s. 37-- CIT v . Banswara Syntex Ltd . (Raj) . . . 419

Capital or revenue expenditure --Repairs and maintenance--Necessary not only for achieving optimum utilization of machinery but also to extend its economic life--Increase of life of existing assets beyond their original estimated economic life--Increase of profitability of a concern--Not relevant to determine nature of repairs and maintenance--Expenses on repairs and maintenance--Revenue expenditure--Income-tax Act, 1961-- CIT v. Vishal Paper Industries (P&H) . . . 478

Charitable trust --Charitable purpose--Donation for charitable purposes--Exemption--Renewal of exemption--Exemption once granted shall continue in perpetuity--Exemption cannot be withdrawn without issuing notice--CBDT Circulars Nos. 5 of 2010, dated 3-6-2010 and 7 of 2010, dated 27-10-2010--Income-tax Act, 1961, s. 80G-- CIT v. Bhhola Bhandari Charitable Trust (P&H) . . . 469

Exemption --Newly established 100 per cent. export oriented undertaking--Law applicable--Amendment in 1998 extending period of exemption to ten years--Assessee enjoying exemption prior to amendment--Eligible for extended period if eligible for exemption on 1-4-1999--Income-tax Act, 1961, s. 10B-- CIT v . DSL Software Ltd .
(Karn) . . . 385

Export --Special deduction--Computation--
Unabsorbed depreciation and carried forward losses of earlier years to be considered to arrive at profits of business--Cash assistance--Only actual sums received to be considered, not notional receipts--Income-tax Act, 1961, ss. 28(iiib), 72(2), 80HHC, Expln. (baa) -- J. K. Industries Ltd . v. Joint CIT (Karn) . . . 454

----Special deduction--Computation of profits of export--Unabsorbed depreciation of earlier years to be set off for arriving at profits--Income-tax Act, 1961, s. 80HHC-- J. K. Industries Ltd. v . Asst. CIT (Karn) . . . 434

Offences and prosecution --Wilful attempt to evade tax--Provisions of Income-tax Act have overriding effect over criminal law--Framing of charge--Guilt of accused need not be proved--Books of account containing false entries--Proceedings can be initiated under section 276C--Income-tax Act, 1961, s. 276C--Code of Criminal Procedure, 1973, ss. 227, 228, 397, 482-- Dy. CIT v . General Sales P. Ltd . (Delhi) . . . 410

Reassessment --Notice--Industrial undertaking--Pet bottles--Special deduction--Pet bottles not falling within negative list--Assessing Officer allowing deduction after examining evidence--Notices on ground pet bottles falling within negative list--No prima facie view that there were reasons to believe that income had escaped assessment--Notices not valid--Income-tax Act, 1961, ss. 147, 148-- Ajay Kumar Sharma v . CIT (Delhi) . . . 428

----Notice after four years--Conditions precedent--Commission paid to directors allowed after examining nature of payments and agreements with directors--Reopening on ground payment not eligible for deduction as payment could have been made to director who is shareholder as disbursement of profit or dividend--No suppression on part of assessee or failure on part of assessee to state fully and truly all material facts necessary for assessment--Notice not valid--Income-tax Act, 1961, s. 148-- OHM Stock Brokers Pvt. Ltd. v . CIT (Bom) . . . 443

----Notice within four years--No power in Assessing Officer to review assessment--Commission paid to directors--Assessee explaining basis on which decision taken to make payment of commission--Amounts paid to directors assessed as salary income in their hands--Reopening of assessment on change of opinion without tangible material not valid--Income-tax Act, 1961, ss. 36(1)(ii), 148-- OHM Stock Brokers Pvt. Ltd . v. CIT (Bom) . . . 443

Search and seizure --Block assessment--Conditions precedent--Search in premises of father of assessees--Seizure of documents not belonging to assessees--No authorisation of search or search warrants against assessees--Block assessments in hands of assessees under section 158BC--Not valid--Provisions of section 158BD applicable--Income-tax Act, 1961, ss. 158BC, 158BD-- CIT v. Ram Singh (P&H) . . . 391

Writ --High Court--Petitions against assessment orders--Appeals pending before Commissioner (Appeals) or before Tribunal--Challenge to charging of interest--Court will not gone into legal pleas taken by assessee--Remedy in appellate forums--Income-tax Act, 1961, ss. 234B, 234C--Constitution of India, art. 226-- Super Spinning Mills Ltd . v. Asst. CIT (Mad) . . . 401

SECTIONWISE INDEX TO CASES REPORTED IN THIS PART

Code of Criminal Procedure, 1973 :

S. 227 --Offences and prosecution--Wilful attempt to evade tax--Provisions of Income-tax Act have overriding effect over criminal law--Framing of charge--Guilt of accused need not be proved--Books of account containing false entries--Proceedings can be initiated under section 276C-- Dy. CIT v . General Sales P. Ltd .
(Delhi) . . . 410

S. 228 --Offences and prosecution--Wilful attempt to evade tax--Provisions of Income-tax Act have overriding effect over criminal law--Framing of charge--Guilt of accused need not be proved--Books of account containing false entries--Proceedings can be initiated under section 276C-- Dy. CIT v . General Sales P. Ltd .
(Delhi) . . . 410

S. 397 --Offences and prosecution--Wilful attempt to evade tax--Provisions of Income-tax Act have overriding effect over criminal law--Framing of charge--Guilt of accused need not be proved--Books of account containing false entries--Proceedings can be initiated under section 276C-- Dy. CIT v . General Sales P. Ltd .
(Delhi) . . . 410

S. 482 --Offences and prosecution--Wilful attempt to evade tax--Provisions of Income-tax Act have overriding effect over criminal law--Framing of charge--Guilt of accused need not be proved--Books of account containing false entries--Proceedings can be initiated under section 276C-- Dy. CIT v . General Sales P. Ltd .
(Delhi) . . . 410

Constitution of India :

Art. 226 --Writ--High Court--Petitions against assessment orders--Appeals pending before Commissioner (Appeals) or before Tribunal--Challenge to charging of interest--Court will not gone into legal pleas taken by assessee--Remedy in appellate forums-- Super Spinning Mills Ltd . v. Asst. CIT (Mad) . . . 401

Income-tax Act, 1961 :

S. 10B --Exemption--Newly established 100 per cent. export oriented undertaking--Law applicable--Amendment in 1998 extending period of exemption to ten years--Assessee enjoying exemption prior to amendment--Eligible for extended period if eligible for exemption on 1-4-1999-- CIT v . DSL Software Ltd . (Karn) . . . 385

S. 28(iiib) --Export--Special deduction--Computation--Unabsorbed depreciation and carried forward losses of earlier years to be considered to arrive at profits of business--Cash assistance--Only actual sums received to be considered, not notional receipts-- J. K. Industries Ltd . v. Joint CIT (Karn) . . . 454

S. 36(1)(ii) --Reassessment--Notice within four years--No power in Assessing Officer to review assessment--Commission paid to directors--Assessee explaining basis on which decision taken to make payment of commission--Amounts paid to directors assessed as salary income in their hands--Reopening of assessment on change of opinion without tangible material not valid-- OHM Stock Brokers Pvt. Ltd . v. CIT
(Bom) . . . 443

S. 37 --Business expenditure--Lease rent--Hire of machinery by assessee--Ownership of machinery remaining with lessor--Assessee having no right to transfer or alienate machinery and obliged to re-deliver equipment upon termination of lease agreement--Agreements accepted as real and genuine--Lease rentals paid on hired machinery allowable as business expenditure-- CIT v . Banswara Syntex Ltd . (Raj) . . . 419

S. 72(2) --Export--Special deduction--Computation--Unabsorbed depreciation and carried forward losses of earlier years to be considered to arrive at profits of business--Cash assistance--Only actual sums received to be considered, not notional receipts-- J. K. Industries Ltd . v. Joint CIT (Karn) . . . 454

S. 80G --Charitable trust--Charitable purpose--Donation for charitable purposes--Exemption--Renewal of exemption--Exemption once granted shall continue in perpetuity--Exemption cannot be withdrawn without issuing notice--CBDT Circulars Nos. 5 of 2010, dated 3-6-2010 and 7 of 2010, dated 27-10-2010-- CIT v. Bhhola Bhandari Charitable Trust (P&H) . . . 469

S. 80HHC --Export--Special deduction--Computation of profits of export--Unabsorbed depreciation of earlier years to be set off for arriving at profits-- J. K. Industries Ltd. v . Asst. CIT (Karn) . . . 434

S. 80HHC, Expln. (baa) --Export--Special deduction--Computation--Unabsorbed depreciation and carried forward losses of earlier years to be considered to arrive at profits of business--Cash assistance--Only actual sums received to be considered, not notional receipts-- J. K. Industries Ltd . v. Joint CIT (Karn) . . . 454

S. 143(3) --Advance tax--Interest--Notice of demand--No direction in assessment order for charging interest--Notice of demand cannot be issued levying interest under section 234B-- CIT v . Dehradun Club Ltd . (Uttarakhand) . . . 396

S. 147 --Reassessment--Notice--Industrial undertaking--Pet bottles--Special deduction--Pet bottles not falling within negative list--Assessing Officer allowing deduction after examining evidence--Notices on ground pet bottles falling within negative list--No prima facie view that there were reasons to believe that income had escaped assessment--Notices not valid-- Ajay Kumar Sharma v . CIT (Delhi) . . . 428

S. 148 --Reassessment--Notice--Industrial undertaking--Pet bottles--Special deduction--Pet bottles not falling within negative list--Assessing Officer allowing deduction after examining evidence--Notices on ground pet bottles falling within negative list--No prima facie view that there were reasons to believe that income had escaped assessment--Notices not valid-- Ajay Kumar Sharma v . CIT (Delhi) . . . 428

----Reassessment--Notice after four years--Conditions precedent--Commission paid to directors allowed after examining nature of payments and agreements with directors--Reopening on ground payment not eligible for deduction as payment could have been made to director who is shareholder as disbursement of profit or dividend--No suppression on part of assessee or failure on part of assessee to state fully and truly all material facts necessary for assessment--Notice not valid-- OHM Stock Brokers Pvt. Ltd. v . CIT (Bom) . . . 443

----Reassessment--Notice within four years--No power in Assessing Officer to review assessment--Commission paid to directors--Assessee explaining basis on which decision taken to make payment of commission--Amounts paid to directors assessed as salary income in their hands--Reopening of assessment on change of opinion without tangible material not valid-- OHM Stock Brokers Pvt. Ltd . v. CIT (Bom) . . . 443

S. 156 --Advance tax--Interest--Notice of demand--No direction in assessment order for charging interest--Notice of demand cannot be issued levying interest under section 234B-- CIT v . Dehradun Club Ltd . (Uttarakhand) . . . 396

S. 158BC --Search and seizure--Block assessment--Conditions precedent--Search in premises of father of assessees--Seizure of documents not belonging to assessees--No authorisation of search or search warrants against assessees--Block assessments in hands of assessees under section 158BC--Not valid--Provisions of section 158BD applicable-- CIT v. Ram Singh (P&H) . . . 391

S. 158BD --Search and seizure--Block assessment--Conditions precedent--Search in premises of father of assessees--Seizure of documents not belonging to assessees--No authorisation of search or search warrants against assessees--Block assessments in hands of assessees under section 158BC--Not valid--Provisions of section 158BD applicable-- CIT v. Ram Singh (P&H) . . . 391

S. 234B --Advance tax--Interest--Notice of demand--No direction in assessment order for charging interest--Notice of demand cannot be issued levying interest under section 234B-- CIT v . Dehradun Club Ltd . (Uttarakhand) . . . 396

----Writ--High Court--Petitions against assessment orders--Appeals pending before Commissioner (Appeals) or before Tribunal--Challenge to charging of interest--Court will not gone into legal pleas taken by assessee--Remedy in appellate forums-- Super Spinning Mills Ltd . v. Asst. CIT (Mad) . . . 401

S. 234C --Writ--High Court--Petitions against assessment orders--Appeals pending before Commissioner (Appeals) or before Tribunal--Challenge to charging of interest--Court will not gone into legal pleas taken by assessee--Remedy in appellate forums-- Super Spinning Mills Ltd . v. Asst. CIT (Mad) . . . 401

S. 260A --Appeal to High Court--Competency of appeal--Circular prescribing monetary limits for appeals by Department--Net tax effect less than prescribed limit--Appeal not maintainable-- ITO v . Ramdas Alva (Karn) . . . 471

S. 276C --Offences and prosecution--Wilful attempt to evade tax--Provisions of Income-tax Act have overriding effect over criminal law--Framing of charge--Guilt of accused need not be proved--Books of account containing false entries--Proceedings can be initiated under section 276C-- Dy. CIT v . General Sales P. Ltd .
(Delhi) . . . 410

Right to Information Act, 2005 :

S. 8(1)(j) --Right to information--Exemption from disclosure--Invasion of privacy of individual--Return of income--Information found in income-tax return--Personal and exempt--No case of public interest in disclosure made out--Information not to be disclosed-- Girish Ramchandra Deshpande v . Central Information Commissioner
(SC) . . . 472

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