Monday, June 12, 2017

ITR Volume 202 Part 6

ITR Volume 202 Part 6

AX REPORTS (ITR)--PRINT AND ONLINE EDITION

Appeal to Appellate Tribunal --Procedure--Additional evidence--Additional evidence on affidavit by assessee--Tribunal cannot consider such additional evidence--Income-tax (Appellate Tribunal) Rules, 1963, r. 29-- CIT v. Canara Housing Development Company(Karn) . . . 309

Business expenditure --Agreement to sell cement factory on 25-8-1999--Actual transfer in subsequent year--Agreement stipulating that title to assets should be perfected and lease agreement renewed--Expenditure in relation to transfer of plant and machinery deductible in assessment year 2002-03--Amount spent on maintenance of corporate office--Deductible--No evidence of payment of royalty--Royalty not deductible--Income-tax Act, 1961--Karnataka Instrade Corporation Ltd. v. Asst. CIT (Karn) . . . 295

Disallowance--Payments liable to deduction of tax at source--Non-resident--Commission paid to foreign agents--Non-resident agents procuring orders and following up payments with buyers for assessee--No contribution of any technical knowledge--Commission payments not for technical services--No deduction of tax at source required and disallowance not attracted--Income-tax Act, 1961, ss. 9(1)(vii), 40(a)(i)-- CIT v. Farida Leather Company(Mad) . . . 328

Co-operative society --Co-operative bank--Special deduction under section 80P--Special deduction not available for interest on income-tax refund--Income-tax Act, 1961, s. 80P--Rajkot Nagarik Sahakari Bank Ltd. v. Asst. CIT (Guj) . . . 337

Depreciation --Unabsorbed depreciation--Amounts written back in accounts and assessed as business income under section 41--Unabsorbed depreciation can be set off against such income--Income-tax Act, 1961, ss. 32, 41-- Karnataka Instrade Corporation Ltd. v. Asst. CIT(Karn) . . . 295

Interest --Deduction--Hundred per cent. export oriented undertaking--Interest accrued on temporarily surplus business funds deposited for short-term with bank--To be treated as profits of business of undertaking--Entitled to deduction--Income-tax Act, 1961, s. 10B--CIT v. Hindustan Gum and Chemicals Ltd. (Cal) . . . 323

Loss --Carry forward and set off--Amounts treated as business income under section 41--Losses carried forward can be set off against such income--Income-tax Act, 1961, s. 41--Karnataka Instrade Corporation Ltd. v. Asst. CIT (Karn) . . . 295

Penalty --Repayment of loan or deposit in excess of specified amount otherwise than by account payee cheque or account payee bank draft--Exemption from penalty in case of reasonable explanation for such payment--Repayments in excess of Rs. one crore--Finding that there were banking facilities available and there was no reasonable explanation for so many payments--Penalty can be levied--Income-tax Act, 1961, ss. 269T, 271B, 271E-- CITv. Canara Housing Development Company (Karn) . . . 309

Precedent --Binding nature of-- Yashovardhan Birla v. Deputy CIT (Bom) . . . 284

High Court--Decision binding on all authorities within State including Settlement Commission-- Yashovardhan Birla v. Deputy CIT (Bom) . . . 284

Settlement of cases --Condition precedent for application--Pendency of assessment proceedings--Assessment would be considered pending till service of assessment order upon assessee--Provisions of Chapter XIX-A can be invoked--Income-tax Act, 1961, s. 245D(1)-- Yashovardhan Birla v. Deputy CIT (Bom) . . . 284

Limitation--Abatement of proceedings--Period specified in section 245D for passing order mandatory--Order passed after expiry of period--Proceedings abate--Income-tax Act, 1961, ss. 245D, 245HA-- RNS Infrastructure Ltd. v. ITSC (Karn) . . . 262

Transfer of case --Scope of section 127--Transfer for purposes of centralisation of cases--Reasons for transfer recorded--Objection of assessee considered--Order of transfer valid--Income-tax Act, 1961, s. 127-- Dr. Monu Pattanayak v. Principal Chief CIT (Orissa) . . . 273

PRINT EDITIONITR Volume 394 : Part 4 (Issue dated : 12-6-2017)SUBJECT INDEX TO CASES REPORTED IN

THIS PARTSUPREME COURT
Heads of income --Income from house property or business income--Letting of property--Whether business activity--To be determined on facts--Clause in objects of assessee not conclusive --Assessee must show that its entire income or a substantial part thereof was from letting of property which was its principal business activity--Objects clause in partnership deed to take premises on rent and to sub-let them--Assessee “deemed ownerâ€--Finding of Tribunal that assessee had not established that it was engaged in systematic or organised activity of providing service to occupiers of shops--Receipts from sub-licensees not business income but to be treated as income from house property--Income-tax Act, 1961, ss. 14, 22, 27(iiib), 269UA(f)-- Raj Dadarkar and Associates v. Asst. CIT . . . 592

HIGH COURTS
Appeal to Appellate Tribunal --Appeal to Commissioner (Appeals)--Powers of Tribunal--Condition precedent for appealing to Commissioner (Appeals)--Payment of taxes due--Tax not paid on date of appeal--Appeal dismissed--Subsequent payment of tax--Tribunal directing Commissioner (Appeals) to hear appeal--Justified--Income-tax Act, 1961, s. 254-- Principal CIT v. Abdul Zahid M. (Karn) . . . 727

Powers of Tribunal--Tribunal can grant refund--Income-tax Act, 1961, s. 254-- Kalindee Rail Nirman (Engineers) Ltd. v. CIT (Raj) . . . 684

Search and seizure--Proceedings pursuant to search conducted during pendency of appeal not brought to notice of Appellate Tribunal--Order of Appellate Tribunal without considering developments to be set aside--Matter remitted to Appellate Tribunal--Income-tax Act, 1961, ss. 132, 133A, 143(3), 153A-- Skyline Builders v. CIT (Ker) . . . 768

Business --Business income--Remission or cessation of trading liability--Burden on Department to prove such cessation--Finding by Tribunal that burden had not been discharged--Addition to income under section 41(1) not justified--Income-tax Act, 1961, s. 41-- Principal CIT v. Ramgopal Minerals (Karn) . . . 696

Capital gains --Exemption--Investment of gains in residential house--Assessee getting more than one residential house in several blocks--All flats product of one development agreement of same piece of land--Flats located in same address--Assessee entitled to benefit under section 54F--Income-tax Act, 1961, s. 54F-- CIT v. Gumanmal Jain (Mad) . . . 666

Transfer--Relinquishment of life interest in property--Not gift in absence of transfer by releaser to assessee--No acquisition of capital assets by way of gift--Income-tax Act, 1961, s. 49(1)(ii)--Gift-tax Act, 1958, s. 4(1)(c), (d), (e)-- Nusli N. Wadia v. CIT (Bom) . . . 638

Cash credits --Issue of shares at premium--Three essential tests--Genuineness of transactions, identity, and capacity of investors--Tests satisfied--Amendment requiring share applicant to explain source of moneys--Not to be given retrospective effect--Income-tax Act, 1961, s. 68-- CIT v. Gagandeep Infrastructure Pvt. Ltd. (Bom) . . . 680

Charitable purposes --Depreciation--Application of income in acquisition of capital asset--Provision barring allowance of depreciation on such asset prospective--Depreciation on assets allowable for earlier period--Income-tax Act, 1961, s. 11(1), (6)-- CIT (Exemption) v. Seth Anandram Jaipuria Education Society (All) . . . 712

Expenditure incurred on payment of scholarship--Payment of scholarship for advancement of higher technical education to deserving students--Expenditure allowable--Income-tax Act, 1961-- CIT (Exemption) v. Seth Anandram Jaipuria Education Society (All) . . . 712

Hotel business --Special deduction--Condition precedent--Claim must be made in return--Assessee’s claim to deduction under section 80-IB(7)(a) denied for want of approval by prescribed authority but deduction allowed of lower sum under clause (b)--Not a case where no claim made in return to deduction under section 80-IB(7)--Assessee cannot be denied deduction--Income-tax Act, 1961, ss. 80A, 80-IB(7)-- Shrikar Hotels Pvt. Ltd. v. CIT (All) . . . 657

Special deduction--Grant of approval--Application by assessee for approval pending decision with Director General (Exemptions)--Benefit cannot be denied for inaction of prescribed authority--Denial of deduction erroneous--Income-tax Act, 1961, s. 80-IB(7)(a)--Shrikar Hotels Pvt. Ltd. v. CIT (All) . . . 657

Income --Business income--Remission or cessation of trading liability--Conditions precedent for application of section 41--Cessation of liability and benefit to assessee--Mere inability to prove credit not sufficient--Section 41 not applicable--Income-tax Act, 1961, s. 41-- CIT v. Alvares and Thomas (Karn) . . . 647

Income-tax --General Principles--Taxation only in accordance with law-- Kalindee Rail Nirman (Engineers) Ltd. v. CIT (Raj) . . . 684

Income from other sources --Cash credits--Exemption in respect of remittances received from abroad from relative--Burden of proof--Failure to establish genuineness and creditworthiness of donor--Receipts taxable as income--Income-tax Act, 1961, ss. 56(2), 68-- Sunil Thomas v. ITO (Ker) . . . 619

Legislative powers --Parliament--Discrimination--Provisions mandating claim to deductions with respect to profits of export oriented unit to be made in return within time stipulated under section 139(1)--Not arbitrary, discriminatory, unreasonable or violative of article 14--Claim to deduction under section 10B(1) made in return filed belatedly--Relief cannot be granted--Income-tax Act, 1961, ss. 10B(1), 80A(5), 139(1), 139(4)--Constitution of India, arts. 14, 226-- Nath Brothers Exim International Ltd. v. Union of India (Delhi) . . . 577

Offences and prosecution --Compounding of offences--No limitation period for application for compounding--Application cannot be rejected on ground that application not accompanied by compounding fee or that compounding fee not paid prior to application being considered on merits--Chief Commissioner directed to consider afresh assessee’s application for compounding of offence--Income-tax Act, 1961, s. 279-- Vikram Singh v. Union of India(Delhi) . . . 746

Reassessment --Condition precedent--New material--Income-tax Act, 1961, ss. 147, 148--Martech Peripherals P. Ltd. v. Deputy CIT (Mad) . . . 733

Income escaping assessment--Undisclosed investment--Addition on account of unexplained investment in building--Assessee not establishing creditworthiness of creditors but only identity of creditors--Findings of fact by Appellate Tribunal based on appraisal of evidence--No infirmity--Income-tax Act, 1961, s. 69-- Dr. Chhangur Rai v. CIT (All) . . . 611

Income escaping assessment--Undisclosed investment--Assessee’s failure to file returns for years during which investments made showing corresponding income--Additions made by Assessing Officer based on District Valuation Officer’s report--Reassessment proceedings valid and proper--Income-tax Act, 1961, ss. 69, 147, 148-- Dr. Chhangur Rai v. CIT (All) . . . 611

Notice--Validity--Assessing Officer passing reassessment order without disposing objection raised by assessee against notice--Reassessment order not valid--Income-tax Act, 1961, ss. 147, 148-- Martech Peripherals P. Ltd. v. Deputy CIT (Mad) . . . 733

Scope of--Power of Assessing Officer to consider other income not mentioned in reasons recorded--Only if income mentioned in reasons forms part of reassessed income--Income-tax Act, 1961, ss. 147, 148-- Martech Peripherals P. Ltd. v. Deputy CIT (Mad) . . . 733

Recovery of tax --Writ--Locus standi--Assessment of earlier year, initiation of proceedings and conclusion in name of non-resident assessee--State Government with which non-resident entered into contract not party to earlier proceedings--Not entitled to seek rectification of order of Tribunal or file writ petition--For consistency of law parties should be continuously joined all throughout proceedings--Income-tax Act, 1961-- Chief Engineer I D and R Irrigation Department v. Asst. CIT (Raj) . . . 720

Search and seizure --Assessment in search cases--Assessment of third party--Condition precedent--Recording of satisfaction by Assessing Officer that seized material or cash belonged to third party--Search in premises of director of assessee-company and seizure of cash--Statement made by director in course of search that part of seized cash belonged to assessee--Constitutes material under section 132(4)--Satisfaction sufficient under section 153C--Income-tax Act, 1961, ss. 132, 132(4), 153A, 153C-- Principal CIT v. Nau Nidh Overseas Pvt. Ltd. (Delhi) . . . 753

Assessment in search cases--Assessment of third party--Document seized whether belonging to third party assessee--Person in respect of whom search conducted denying that document pertained to assessee--Finding of fact--No material to contradict brought by Department--Pre-condition not fulfilled--Provisions of section 153C not attracted--Income-tax Act, 1961, ss. 132, 153A, 153C-- Principal CIT v. Vinita Chaurasia (Delhi) . . . 758

Assessment of third party--Burden of proof--Source of seized document--Person in respect of whom search conducted stating that document was proposal given by broker--Duty of Department to ascertain truth of document investigating further--Additions made to assessee’s income based on conjectures--Unsustainable--Income-tax Act, 1961, ss. 132, 153A, 153C-- Principal CIT v. Vinita Chaurasia (Delhi) . . . 758

Settlement of cases --Abatement of proceedings--Effect--Proceedings before Assessing Officer revive on date of abatement of assessee’s application--Assessing Officer bound to pass fresh orders disposing of assessment proceedings in accordance with law--Assessing Officer not right in treating earlier assessment order as valid and serving demand notice--Earlier assessment order and proceedings for recovery of demand to be set aside--Income-tax Act, 1961, s. 245HA(2)-- Chain Roop Bhansali v. Union of India (Delhi) . . . 703

Transfer of case --Transfer of cases due to re-structuring of Department--Administrative convenience for equitable distribution of work--Order communicated to assessees--Assessees given option to be heard at camp court--No prejudice caused to interest of assessees--Income-tax Act, 1961, s. 127(2)-- Swayamstuti Pattanayak v. Principal Chief CIT (Orissa) . . . 627

Words and phrases --â€Relativeâ€--Term as explained in Explanation to proviso of section 56(2) of 1961 Act-- Sunil Thomas v. ITO (Ker) . . . 619

Writ --Existence of alternative remedy--Does not exclude power of court to entertain writ petition when challenge raised on ground of absence of jurisdiction or breach of principles of natural justice--Constitution of India, art. 226--Income-tax Act, 1961, ss. 147, 148-- Martech Peripherals P. Ltd. v. Deputy CIT (Mad) . . . 733

SECTIONWISE INDEX TO CASES REPORTED IN THIS PART

Constitution of India :Art. 14 --Legislative powers--Parliament--Discrimination--Provisions mandating claim to deductions with respect to profits of export oriented unit to be made in return within time stipulated under section 139(1)--Not arbitrary, discriminatory, unreasonable or violative of article 14--Claim to deduction under section 10B(1) made in return filed belatedly--Relief cannot be granted-- Nath Brothers Exim International Ltd. v. Union of India (Delhi) . . . 577

Art. 226 --Legislative powers--Parliament--Discrimination--Provisions mandating claim to deductions with respect to profits of export oriented unit to be made in return within time stipulated under section 139(1)--Not arbitrary, discriminatory, unreasonable or violative of article 14--Claim to deduction under section 10B(1) made in return filed belatedly--Relief cannot be granted-- Nath Brothers Exim International Ltd. v. Union of India (Delhi) . . . 577

Writ--Existence of alternative remedy--Does not exclude power of court to entertain writ petition when challenge raised on ground of absence of jurisdiction or breach of principles of natural justice-- Martech Peripherals P. Ltd. v. Deputy CIT (Mad) . . . 733

Gift-tax Act, 1958 :S. 4(1)(c), (d), (e) --Capital gains--Transfer--Relinquishment of life interest in property--Not gift in absence of transfer by releaser to assessee--No acquisition of capital assets by way of gift-- Nusli N. Wadia v. CIT (Bom) . . . 638

Income-tax Act, 1961 :S. 10B(1) --Legislative powers--Parliament--Discrimination--Provisions mandating claim to deductions with respect to profits of export oriented unit to be made in return within time stipulated under section 139(1)--Not arbitrary, discriminatory, unreasonable or violative of article 14--Claim to deduction under section 10B(1) made in return filed belatedly--Relief cannot be granted-- Nath Brothers Exim International Ltd. v. Union of India (Delhi) . . . 577

S. 11(1), (6) --Charitable purposes--Depreciation--Application of income in acquisition of capital asset--Provision barring allowance of depreciation on such asset prospective--Depreciation on assets allowable for earlier period-- CIT (Exemption) v. Seth Anandram Jaipuria Education Society (All) . . . 712

S. 14 --Heads of income--Income from house property or business income--Letting of property--Whether business activity--To be determined on facts--Clause in objects of assessee not conclusive --Assessee must show that its entire income or a substantial part thereof was from letting of property which was its principal business activity--Objects clause in partnership deed to take premises on rent and to sub-let them--Assessee “deemed ownerâ€--Finding of Tribunal that assessee had not established that it was engaged in systematic or organised activity of providing service to occupiers of shops--Receipts from sub-licensees not business income but to be treated as income from house property-- Raj Dadarkar and Associates v. Asst. CIT (SC) . . . 592

S. 22 --Heads of income--Income from house property or business income--Letting of property--Whether business activity--To be determined on facts--Clause in objects of assessee not conclusive --Assessee must show that its entire income or a substantial part thereof was from letting of property which was its principal business activity--Objects clause in partnership deed to take premises on rent and to sub-let them--Assessee “deemed ownerâ€--Finding of Tribunal that assessee had not established that it was engaged in systematic or organised activity of providing service to occupiers of shops--Receipts from sub-licensees not business income but to be treated as income from house property-- Raj Dadarkar and Associates v. Asst. CIT (SC) . . . 592

S. 27(iiib) --Heads of income--Income from house property or business income--Letting of property--Whether business activity--To be determined on facts--Clause in objects of assessee not conclusive --Assessee must show that its entire income or a substantial part thereof was from letting of property which was its principal business activity--Objects clause in partnership deed to take premises on rent and to sub-let them--Assessee “deemed ownerâ€--Finding of Tribunal that assessee had not established that it was engaged in systematic or organised activity of providing service to occupiers of shops--Receipts from sub-licensees not business income but to be treated as income from house property-- Raj Dadarkar and Associates v. Asst. CIT (SC) . . . 592

S. 41 --Business--Business income--Remission or cessation of trading liability--Burden on Department to prove such cessation--Finding by Tribunal that burden had not been discharged--Addition to income under section 41(1) not justified-- Principal CIT v. Ramgopal Minerals (Karn) . . . 696

Income--Business income--Remission or cessation of trading liability--Conditions precedent for application of section 41--Cessation of liability and benefit to assessee--Mere inability to prove credit not sufficient--Section 41 not applicable-- CIT v. Alvares and Thomas(Karn) . . . 647

S. 49(1)(ii) --Capital gains--Transfer--Relinquishment of life interest in property--Not gift in absence of transfer by releaser to assessee--No acquisition of capital assets by way of gift--Nusli N. Wadia v. CIT (Bom) . . . 638

S. 54F --Capital gains--Exemption--Investment of gains in residential house--Assessee getting more than one residential house in several blocks--All flats product of one development agreement of same piece of land--Flats located in same address--Assessee entitled to benefit under section 54F-- CIT v. Gumanmal Jain (Mad) . . . 666

S. 56(2) --Income from other sources--Cash credits--Exemption in respect of remittances received from abroad from relative--Burden of proof--Failure to establish genuineness and creditworthiness of donor--Receipts taxable as income-- Sunil Thomas v. ITO (Ker) . . . 619

S. 68 --Cash credits--Issue of shares at premium--Three essential tests--Genuineness of transactions, identity, and capacity of investors--Tests satisfied--Amendment requiring share applicant to explain source of moneys--Not to be given retrospective effect-- CIT v. Gagandeep Infrastructure Pvt. Ltd. (Bom) . . . 680

Income from other sources--Cash credits--Exemption in respect of remittances received from abroad from relative--Burden of proof--Failure to establish genuineness and creditworthiness of donor--Receipts taxable as income-- Sunil Thomas v. ITO (Ker) . . . 619

S. 69 --Reassessment--Income escaping assessment--Undisclosed investment--Addition on account of unexplained investment in building--Assessee not establishing creditworthiness of creditors but only identity of creditors--Findings of fact by Appellate Tribunal based on appraisal of evidence--No infirmity-- Dr. Chhangur Rai v. CIT (All) . . . 611

Reassessment--Income escaping assessment--Undisclosed investment--Assessee’s failure to file returns for years during which investments made showing corresponding income--Additions made by Assessing Officer based on District Valuation Officer’s report--Reassessment proceedings valid and proper-- Dr. Chhangur Rai v. CIT(All) . . . 611

S. 80A --Hotel business--Special deduction--Condition precedent--Claim must be made in return--Assessee’s claim to deduction under section 80-IB(7)(a) denied for want of approval by prescribed authority but deduction allowed of lower sum under clause (b)--Not a case where no claim made in return to deduction under section 80-IB(7)--Assessee cannot be denied deduction-- Shrikar Hotels Pvt. Ltd. v. CIT (All) . . . 657

S. 80A(5) --Legislative powers--Parliament--Discrimination--Provisions mandating claim to deductions with respect to profits of export oriented unit to be made in return within time stipulated under section 139(1)--Not arbitrary, discriminatory, unreasonable or violative of article 14--Claim to deduction under section 10B(1) made in return filed belatedly--Relief cannot be granted-- Nath Brothers Exim International Ltd. v. Union of India (Delhi) . . . 577

S. 80-IB(7) --Hotel business--Special deduction--Condition precedent--Claim must be made in return--Assessee’s claim to deduction under section 80-IB(7)(a) denied for want of approval by prescribed authority but deduction allowed of lower sum under clause (b)--Not a case where no claim made in return to deduction under section 80-IB(7)--Assessee cannot be denied deduction-- Shrikar Hotels Pvt. Ltd. v. CIT (All) . . . 657

S. 80-IB(7)(a) --Hotel business--Special deduction--Grant of approval--Application by assessee for approval pending decision with Director General (Exemptions)--Benefit cannot be denied for inaction of prescribed authority--Denial of deduction erroneous-- Shrikar Hotels Pvt. Ltd. v. CIT (All) . . . 657

S. 127(2) --Transfer of case--Transfer of cases due to re-structuring of Department--Administrative convenience for equitable distribution of work--Order communicated to assessees--Assessees given option to be heard at camp court--No prejudice caused to interest of assessees-- Swayamstuti Pattanayak v. Principal Chief CIT (Orissa) . . . 627

S. 132 --Appeal to Appellate Tribunal--Search and seizure--Proceedings pursuant to search conducted during pendency of appeal not brought to notice of Appellate Tribunal--Order of Appellate Tribunal without considering developments to be set aside--Matter remitted to Appellate Tribunal-- Skyline Builders v. CIT (Ker) . . . 768

Search and seizure--Assessment in search cases--Assessment of third party--Condition precedent--Recording of satisfaction by Assessing Officer that seized material or cash belonged to third party--Search in premises of director of assessee-company and seizure of cash--Statement made by director in course of search that part of seized cash belonged to assessee--Constitutes material under section 132(4)--Satisfaction sufficient under section 153C-- Principal CIT v. Nau Nidh Overseas Pvt. Ltd. (Delhi) . . . 753

Search and seizure--Assessment in search cases--Assessment of third party--Document seized whether belonging to third party assessee--Person in respect of whom search conducted denying that document pertained to assessee--Finding of fact--No material to contradict brought by Department--Pre-condition not fulfilled--Provisions of section 153C not attracted-- Principal CIT v. Vinita Chaurasia (Delhi) . . . 758

Search and seizure--Assessment of third party--Burden of proof--Source of seized document--Person in respect of whom search conducted stating that document was proposal given by broker--Duty of Department to ascertain truth of document investigating further--Additions made to assessee’s income based on conjectures--Unsustainable--Principal CIT v. Vinita Chaurasia (Delhi) . . . 758

S. 132(4) --Search and seizure--Assessment in search cases--Assessment of third party--Condition precedent--Recording of satisfaction by Assessing Officer that seized material or cash belonged to third party--Search in premises of director of assessee-company and seizure of cash--Statement made by director in course of search that part of seized cash belonged to assessee--Constitutes material under section 132(4)--Satisfaction sufficient under section 153C-- Principal CIT v. Nau Nidh Overseas Pvt. Ltd. (Delhi) . . . 753

S. 133A --Appeal to Appellate Tribunal--Search and seizure--Proceedings pursuant to search conducted during pendency of appeal not brought to notice of Appellate Tribunal--Order of Appellate Tribunal without considering developments to be set aside--Matter remitted to Appellate Tribunal-- Skyline Builders v. CIT (Ker) . . . 768

S. 139(1) --Legislative powers--Parliament--Discrimination--Provisions mandating claim to deductions with respect to profits of export oriented unit to be made in return within time stipulated under section 139(1)--Not arbitrary, discriminatory, unreasonable or violative of article 14--Claim to deduction under section 10B(1) made in return filed belatedly--Relief cannot be granted-- Nath Brothers Exim International Ltd. v. Union of India (Delhi) . . . 577

S. 139(4) --Legislative powers--Parliament--Discrimination--Provisions mandating claim to deductions with respect to profits of export oriented unit to be made in return within time stipulated under section 139(1)--Not arbitrary, discriminatory, unreasonable or violative of article 14--Claim to deduction under section 10B(1) made in return filed belatedly--Relief cannot be granted-- Nath Brothers Exim International Ltd. v. Union of India (Delhi) . . . 577

S. 143(3) --Appeal to Appellate Tribunal--Search and seizure--Proceedings pursuant to search conducted during pendency of appeal not brought to notice of Appellate Tribunal--Order of Appellate Tribunal without considering developments to be set aside--Matter remitted to Appellate Tribunal-- Skyline Builders v. CIT (Ker) . . . 768

S. 147 --Reassessment--Condition precedent--New material-- Martech Peripherals P. Ltd. v. Deputy CIT (Mad) . . . 733

Reassessment--Income escaping assessment--Undisclosed investment--Assessee’s failure to file returns for years during which investments made showing corresponding income--Additions made by Assessing Officer based on District Valuation Officer’s report--Reassessment proceedings valid and proper-- Dr. Chhangur Rai v. CIT(All) . . . 611

Reassessment--Notice--Validity--Assessing Officer passing reassessment order without disposing objection raised by assessee against notice--Reassessment order not valid--Martech Peripherals P. Ltd. v. Deputy CIT (Mad) . . . 733

Reassessment--Scope of--Power of Assessing Officer to consider other income not mentioned in reasons recorded--Only if income mentioned in reasons forms part of reassessed income-- Martech Peripherals P. Ltd. v. Deputy CIT (Mad) . . . 733

Writ--Existence of alternative remedy--Does not exclude power of court to entertain writ petition when challenge raised on ground of absence of jurisdiction or breach of principles of natural justice-- Martech Peripherals P. Ltd. v. Deputy CIT (Mad) . . . 733

S. 148 --Reassessment--Condition precedent--New material-- Martech Peripherals P. Ltd. v. Deputy CIT (Mad) . . . 733

Reassessment--Income escaping assessment--Undisclosed investment--Assessee’s failure to file returns for years during which investments made showing corresponding income--Additions made by Assessing Officer based on District Valuation Officer’s report--Reassessment proceedings valid and proper-- Dr. Chhangur Rai v. CIT(All) . . . 611

Reassessment--Notice--Validity--Assessing Officer passing reassessment order without disposing objection raised by assessee against notice--Reassessment order not valid--Martech Peripherals P. Ltd. v. Deputy CIT (Mad) . . . 733

Reassessment--Scope of--Power of Assessing Officer to consider other income not mentioned in reasons recorded--Only if income mentioned in reasons forms part of reassessed income-- Martech Peripherals P. Ltd. v. Deputy CIT (Mad) . . . 733

Writ--Existence of alternative remedy--Does not exclude power of court to entertain writ petition when challenge raised on ground of absence of jurisdiction or breach of principles of natural justice-- Martech Peripherals P. Ltd. v. Deputy CIT (Mad) . . . 733

S. 153A --Appeal to Appellate Tribunal--Search and seizure--Proceedings pursuant to search conducted during pendency of appeal not brought to notice of Appellate Tribunal--Order of Appellate Tribunal without considering developments to be set aside--Matter remitted to Appellate Tribunal-- Skyline Builders v. CIT (Ker) . . . 768

Search and seizure--Assessment in search cases--Assessment of third party--Condition precedent--Recording of satisfaction by Assessing Officer that seized material or cash belonged to third party--Search in premises of director of assessee-company and seizure of cash--Statement made by director in course of search that part of seized cash belonged to assessee--Constitutes material under section 132(4)--Satisfaction sufficient under section 153C-- Principal CIT v. Nau Nidh Overseas Pvt. Ltd. (Delhi) . . . 753

Search and seizure--Assessment in search cases--Assessment of third party--Document seized whether belonging to third party assessee--Person in respect of whom search conducted denying that document pertained to assessee--Finding of fact--No material to contradict brought by Department--Pre-condition not fulfilled--Provisions of section 153C not attracted-- Principal CIT v. Vinita Chaurasia (Delhi) . . . 758

Search and seizure--Assessment of third party--Burden of proof--Source of seized document--Person in respect of whom search conducted stating that document was proposal given by broker--Duty of Department to ascertain truth of document investigating further--Additions made to assessee’s income based on conjectures--Unsustainable--Principal CIT v. Vinita Chaurasia (Delhi) . . . 758

S. 153C --Search and seizure--Assessment in search cases--Assessment of third party--Condition precedent--Recording of satisfaction by Assessing Officer that seized material or cash belonged to third party--Search in premises of director of assessee-company and seizure of cash--Statement made by director in course of search that part of seized cash belonged to assessee--Constitutes material under section 132(4)--Satisfaction sufficient under section 153C-- Principal CIT v. Nau Nidh Overseas Pvt. Ltd. (Delhi) . . . 753

Search and seizure--Assessment in search cases--Assessment of third party--Document seized whether belonging to third party assessee--Person in respect of whom search conducted denying that document pertained to assessee--Finding of fact--No material to contradict brought by Department--Pre-condition not fulfilled--Provisions of section 153C not attracted-- Principal CIT v. Vinita Chaurasia (Delhi) . . . 758

Search and seizure--Assessment of third party--Burden of proof--Source of seized document--Person in respect of whom search conducted stating that document was proposal given by broker--Duty of Department to ascertain truth of document investigating further--Additions made to assessee’s income based on conjectures--Unsustainable--Principal CIT v. Vinita Chaurasia (Delhi) . . . 758

S. 245HA(2) --Settlement of cases--Abatement of proceedings--Effect--Proceedings before Assessing Officer revive on date of abatement of assessee’s application--Assessing Officer bound to pass fresh orders disposing of assessment proceedings in accordance with law--Assessing Officer not right in treating earlier assessment order as valid and serving demand notice--Earlier assessment order and proceedings for recovery of demand to be set aside-- Chain Roop Bhansali v. Union of India (Delhi) . . . 703

S. 254 --Appeal to Appellate Tribunal--Appeal to Commissioner (Appeals)--Powers of Tribunal--Condition precedent for appeal to Commissioner (Appeals)--Payment of taxes due--Tax not paid on date of appeal--Appeal dismissed--Subsequent payment of tax--Tribunal directing Commissioner (Appeals) to hear appeal--Justified-- Principal CIT v. Abdul Zahid M.(Karn) . . . 727

Appeal to Appellate Tribunal--Powers of Tribunal--Tribunal can grant refund-- Kalindee Rail Nirman (Engineers) Ltd. v. CIT (Raj) . . . 684

S. 269UA(f) --Heads of income--Income from house property or business income--Letting of property--Whether business activity--To be determined on facts--Clause in objects of assessee not conclusive --Assessee must show that its entire income or a substantial part thereof was from letting of property which was its principal business activity--Objects clause in partnership deed to take premises on rent and to sub-let them--Assessee “deemed ownerâ€--Finding of Tribunal that assessee had not established that it was engaged in systematic or organised activity of providing service to occupiers of shops--Receipts from sub-licensees not business income but to be treated as income from house property-- Raj Dadarkar and Associates v. Asst. CIT (SC) . . . 592

S. 279 --Offences and prosecution--Compounding of offences--No limitation period for application for compounding--Application cannot be rejected on ground that application not accompanied by compounding fee or that compounding fee not paid prior to application being considered on merits--Chief Commissioner directed to consider afresh assessee’s application for compounding of offence-- Vikram Singh v. Union of India (Delhi) . . . 746


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