Assessing Officer, having not imposed penalty under section 271B while proc

 

IT : Assessing Officer, having not imposed penalty under section 271B while processing original return under section 143(1)(a), cannot impose such penalty while finalizing assessment in response to notice under section 148

[2012] 20 taxmann.com 202 (Punjab and Haryana)
HIGH COURT OF PUNJAB AND HARYANA

Jasbir Singh

v.

Commissioner of Income-tax Patiala*

Subsequent decision of SC, overruling its earlier decision, will be law of land with retrospective effect.

Subsequent decision of SC, overruling its earlier decision, will be law of land with retrospective effect.
   
The Tribunal, on the basis of Supreme Court's judgment in the case of Virtual Soft Systems Ltd. v. CIT [2007] 159 Taxman 155, held that no penalty for concealment can be imposed under section 271(1)(c) if there is no tax payable by assessee. Subsequently, said judgment was overruled by the higher bench of the Supreme Court in CIT v. Gold Coin Health Food (P.) Ltd. [2008] 172 Taxman 386 (SC).
Revenue sought for successful rectification of the order of the Tribunal on the basis of the later decision of the Supreme Court. The assessee preferred writ petition against such rectification order of the Tribunal and contended that the later decision of Supreme Court doesn't make the earlier decision of tribunal erroneous.
The High Court held that where a decision of the Supreme Court overruled its earlier decision, the views expressed in the later decision would have to be regarded as having always been the law of land and that too with retrospective effect. Therefore, it held that the order of tribunal rectifying its earlier order was valid - LAKSHMI SUGAR MILLS CO. LTD. v. CIT [2012] 22 Taxman 300 (Delhi)

Retrospective Amendment - Beneficial to Assessee

 

Retrospective Amendment - Beneficial to Assessee
By CA Pradeep Jain, CA Preeti Parihar & Manish Vyas

IT is said by many learned authors that the Government has used the weapon of retrospective amendment to nullify the Court's ruling. This is being used against the manufacturers. But this time the Government has proved that the same is wrong. A number of retrospective amendment has been done in this budget also but all in favour of the assessee. We are discussing these amendments in this article one by one:-

Issue

Amendment

According to Rule 6(1) of the Cenvat Credit Rules, 2004, the Cenvat credit is not allowed on such quantity of input which is used in or in relation to the manufacturer of exempted goods or for provision of exempted services. If common inputs/input services are used for providing both exempted and taxable services or manufacturing both dutiable or exempted goods; credit will be allowed if separate records are maintained or proportionate reversal is done or an amount @ 6%/5% is paid at the time of removal of exempted goods or providing of exempted services.

But as per Rule 6 (6) of Cenvat Credit Rules, the provision of Rule 6 is not applicable in cases of some exempted clearances/services, for e.g. clearance to 100% EOU. Services provided to SEZ without payment of service tax were added in rule 6(6) w.e.f. 1.4.11. As such, prior to this date, provisions of rule 6(6) are not applicable in the case of services provided to SEZ. Hence the reversal is to be done prior to this date. The department has demanded duty from the service providers in this regard. But this was not the intention. Hence the Rule 6(6) was amended by the Board. But the department said that the aforesaid notification is applicable from the date of issue. Hence the demand for the prior period is sustainable and the service provider should reverse the cenvat credit.

Now retrospective amendment is made in respect of services provided to SEZ. With this amendment, "Providing of taxable service without payment of service tax" will be exempted from the formalities of rule 6 even before 1.4.2011. Hence the demand issued by the department will be dropped.

2. Issue

Amendment

With effect from 25 July, 2011 the exemption is given to the service related to setting of common facilities for treatment and recycling of effluents and solid waste vide notification no. 42/2011-ST. This exemption was highly appreciated as it was in public interest. The Gujarat High Court has also held in case of Green Environment services co-operative society Limited v. Union of India [2009(3)STR250(Guj.)] that the work undertaken by the party is of public interest and they should approach the central government for exemption and the government should consider the same. Thereafter, the Board has given the exemption from this date. But again the department said that the same is applicable from the date of its issue and it is not applicable for the earlier period.

Now, government has brought a retrospective amendment in the said notification. Now the benefit of this notification is available in respect of services provided after 16 June 2005. After passing of the budget, the department will drop the proceedings initiated in this regard. This is also welcome step on the part of Government which shows that the Government is not pro-revenue as is normally said.

3. Issue

Amendment

The construction of road was excluded from the purview of service tax under Commercial construction service. As the definition of commercial construction does not include the road construction. But it was in the dispute whether the repairs of Road will chargeable to service tax when the construction of road itself is excluded. A lot of litigation went on the same. Even the Board has clarified vide circular number 110/4/2009-ST dated 23.2.2009 on the same point that certain work done will be treated as construction of road and other will be treated as repairing of road. The repairing of road will fall under Management, maintenance and repair service and there is no exemption under the aforesaid service. Hence the same is chargeable to service tax. But this was not the intention of the Government. Hence, exemption under notification 24/2009-ST dated 27 th July 2009, amendment was made and Repairs of Road was excluded from levy of service tax. But the litigation continued for the past period.

Now, retrospective amendment has been made in respect of services provided in relation to repairs of road. The effect of this amendment is that the service related to repairs of road provided before 27 th July 2009 and after 16 th June 2005 will also be exempted now. Once again Government has proved that they are trade friendly.

4. Issue

Amendment

The earlier dispute was that whether the exemption will allowed on the service related to Management, Maintenance or repair service in relation to non-Government Buildings?

Retrospective amendment has been made in this regard and now service related to Management, Maintenance or repair service in relation to non-Government Buildings provided after 16 th June 2005 will be exempt. However, this amendment has limited affect till the new scheme of service tax by negative list is implemented. The new scheme will exempt this service by some another notification. But all these amendments have changed the face of Government and it is proved that they do the things which are right whether these are in favour of assessee or the revenue.

With all these retrospective amendments in service tax whereby the relief is granted to the service providers, it is proved that the Government will do the right thing. These all steps of present Government have increased the faith in the minds of the service industry. We welcome these steps. The field formation should also take a lesson from these steps and amend their approach and become friendly with trade and industry. They should not raise the huge demands on assessee on small technical points.

Fact that procedure envisaged by section 153C is somewhat cumbersome and tha

 Fact that procedure envisaged by section 153C is somewhat cumbersome and that person other than searched person is put to some inconvenience cannot be an argument to hold that entire proceedings are bad in law

• There can be some inconveniences in a case where income had already been disclosed by other person who has not been searched; however, there is no cause for any apprehension that income tax authorities will exploit situation to harass assessees where there is evidence adduced by them to show and establish that income reflected by valuable article or books of account or document seized during search has already been disclosed by them; even if they tend to act unreasonably or under misplaced enthusiasm, there are adequate safeguards which can be availed of by those persons

• If AO having jurisdiction over searched person reaches satisfaction that document belongs to a person other than searched person, it is not necessary for him to also reach a firm conclusion/ opinion that document shows undisclosed income belonging to such other person; that is a matter for enquiry, which is to be conducted in manner prescribed by section 153C

[2012] 20 taxmann.com 214 (Delhi)
HIGH COURT OF DELHI

SSP Aviation Ltd.

v.

Deputy Commissioner of Income-tax

Transfer Pricing - Prescribing a Proforma for Obtaining Information - Suggestions Invited from Officers ing Information

 

Income Tax - Transfer Pricing - Prescribing a Proforma for Obtaining Information - Suggestions Invited from Officers

INFORMATION on tax matters is being sought by field officers of the Income Tax Department from countries/jurisdictions with which India has Double Taxation Avoidance Agreement (DTAA) or Tax Information Exchange Agreement (TIEA) under the relevant 'Exchange of Information' Article of DTAA/TIEA through the office of competent authority viz. the Joint Secretary in the Foreign Tax ; Tax Division, CBDT;

At present, the above information is being sought in a prescribed checklist/ proforma (Annexure-A). Further in the case of U.K, for obtaining banking information, a separate proforma has been prescribed by U.K tax authorities (Annexure-B).

Considering the developments at International Forums including the Model Proforma for the exchange of information being developed by the OECD, it is proposed to change the existing proforma. Further, it is proposed to have a separate proforma for obtaining any information relating to Transfer Pricing and prescription of a separate proforma for the same.

The Foreign Tax ; Tax Research Division has requested for views/comments on the following to the FT , TR Division by the 15th December, 2011:

++ for developing separate proforma (T.P) for Transfer Pricing cases

++ for any improvement required to be made to the present Proforma prescribed for obtaining information from countries/jurisdictions with which India has DTAA/TIEA.

++ Any other suggestion relating to the above

The FT , TR Division wants that at present the request may be sent to FT,TR. Division by the concerned Commissioner of Income Tax/Director of Income Tax as per the following guidelines:

++ Request should be made in the checklist/proforma as per Annexure A and Annexure B.

++ Request for the exchange of information may be addressed by the concerned commissioner of Income Tax/Director Income to JS, (FT,TR-I), CBDT, New Delhi, for the North America including Caribbean Island, Europe and Japan and to JS(FT,TR-II), CBDT, New Delhi, for the rest of the world.

++ The request for exchange of information for the cases getting time barred on 31st December, 2011 should be received in the office of JS (FT,TR-I) or JS(FT,TR-II), as the case maybe, by 15th December; 2011.

++ Separate requests should be made for different taxpayers even if the case pertains to same country or same foreign entity. Further, separate requests should be made for different countries even if the cases pertain to the same assessee.

CBDT FT,TR Division F. No. 504/31/2010-FTD-I, dated: 21 November 2011

CANT LINK BENEFITS OF I-T DEDUCTIONS TO DIRECT EMPLOYMENT: HC

 

CANT LINK BENEFITS OF I-T DEDUCTIONS TO DIRECT EMPLOYMENT: HC

The Bombay High Court has ruled that the Income-Tax Department cannot deny the benefits of deduction to the assessee companies on the ground that they must directly employ ten or more workers in their establishments.The court dismissed the plea of the Revenue which said the benefits of deduction under the income-tax law cannot be extended to the assessee employing the stipulated number of the workers through the agency or contractors.The condition imposed under Section 80IB(2)( iv) of the Act (Income Tax Act,1961) is that the assessee must employ ten or more workers in the manufacturing process / production of articles or things and it is immaterial as to whether the workers were directly employed or employed by hiring workers from a contractor,said a bench comprising Justice JP Devadhar and Justice AR Joshi.The bench said: When Section 80IB(2)( iv) of the Act merely provides that the undertaking must employ ten or more workers in the manufacturing process carried on with the aid of power,it would not be proper to hold that Section 80IB(2)( iv) refers to ten workers employed by the assessee directly.When the language used in Section 80IB(2) (iv) of the Act does not suggest that restricted meaning must be given to the expression worker,it would not proper to give a restricted meaning to that expression,the court pointed out.The bench in its order said,the expression worker is neither defined under Section 2 of the act nor under section 80IB(2)( iv) of the Act. – www.economictimes.indiatimes.com

Publication of Names of Accused - A Responsible Act - Not a Casual Joke AS per

 

Publication of Names of Accused - A Responsible Act - Not a Casual Joke

AS per the Service Tax (Publication of Names) Rules, 2008 , the following procedure has to be followed for publication of names of offenders:-

3. Publication of names and other particulars.- Subject to the provisions of these rules, the Central Government may cause to be published in the Official Gazette, print media, electronic media or by any other means, the names and particulars of the following persons, namely:-

(a) Persons, who have been adjudged under the provisions of the Chapter, to have contravened any of the provisions of the Chapter or the rules made thereunder, with intent to evade payment of service tax;

(b) Persons who have been adjudged to pay but has not paid any amount, payable under the provisions of section 73A of the Chapter:

4. Initiation of action and publication.-(1) If the Commissioner of Central Excise, having jurisdiction over such person, is satisfied that it is necessary or expedient in the public interest to publish the names and any other particulars as he deems fit, he shall after due verification of the facts, and the circumstances of the case, forward a proposal in the Annexure appended to these rules for such publication to the jurisdictional Chief Commissioner.

(2) The jurisdictional Chief Commissioner, on receipt of proposal referred to in sub-rule (1), shall within fifteen days from the receipt of such proposal, examine it and if he is satisfied that circumstance of the case justify such publication, may make a recommendation to the Board accordingly.

(3) On receipt of the recommendation by the Board, or on its own, the Central Government may cause publication of the name and other particulars in a manner as specified in rule 3.

So, the power to publish the names is with the Central Government and not even with the Board.

Even the premier investigative agency – CBI does not publish names of corrupt officials caught red handed!

India Legal News on Arbitration in India: SC Disapproves of Retired Judges Charg

 

India Legal News on Arbitration in India: SC Disapproves of Retired Judges Charging Heavy Fees

The Supreme Court of India disapproved of the exorbitant fees charged by retired judges in arbitration cases. Are you wondering what an arbitration case is? Typically, it is an effective alternative for those parties who want to resolve and end their dispute speedily. In fact, the arbitration process in India applies to domestic as well as international arbitration disputes.

India Legal News on Arbitration in India: Crunch up Your Disputes and Resolve it Within Manageable Time

Those who have a dispute are typically impatient till the issue can be resolved with a meaningful outcome. Let's face it – we have a demanding client who wants quick relief. Arbitration in India helps to do that. Through arbitration, two disputing parties can present their dispute before two retired judges of their choice, who will hear the matter as it is done in a court of law and resolve the disagreement based on the merits of the case, without procedural or any other types of delays or postponements.

For the same reason, corporate and other entities tend to insert an arbitration clause in contracts that state clearly, "In the event of a dispute, arbitration proceedings shall apply." Watch out for this clause because it means that you cannot raise this dispute contrary to the provisions of the agreement you have signed.

Arbitration in India on Arbitration in India: Process of Appointing Retired Judges Comes under Heavy Criticism by SC

Coming back to arbitrations in India, let's not forget that the process involves appointment of a retired judge by each party. With expertise and experience in the judiciary, the value that a retired judge brings to research, understand and resolve important disputes cannot be captured in words. For a change, look at their perspective and understand how much effort, analysis and professional inputs are required to resolve an issue of dispute and pass an award.

Typically, the judges in arbitration hear the arguments of each party and then come up to a decision. Their decision is binding. The difficulty is that many retired judges charge extensive amounts, sometimes in lakhs, for these cases. For the same reason, foreign companies have expressed reluctance to invest in India because in case of disputes, they will be forced to get involved with the process of international arbitration. They are worried about the costs involved than the time taken to resolve the dispute.

India Legal News on Arbitration in India: SC Demands Urgent Solution to the `High Fee Problem'

Coming back to the news pertaining to the Supreme Court bench, comprising of Justices R V Raveendran and H L Dattu, dismissed the Center's appeal in challenging a Delhi High Court order on the appointment of a retired High Court judge as sole arbitrator in a dispute between the Railways and a contractor.

The SC Bench objected to a practice of the court on appointing an arbitrator on the warring parties because they have no option but to pay the high fee demanded by the arbitrator. The Supreme Court bench said, "It is necessary to find an urgent solution for this problem...'

There seems to be a good solution if one looks at the model of institutional arbitration, wherein case-to-case fees is not fixed by an arbitrator himself, but follows a uniform rate approved by the supervising institution.

Another way to limit the arbitration fees is to have the fees fixed by the court, with the approval of the concerned parties, when arbitrators are being appointed. Parties to a dispute can also make their selection of an arbitrator by considering the fee structure that is submitted by retired judges to the Registry of their respective High Court.

Arbitration in India is a great endeavor for disputing parties who want speedy resolutions but not approved of by the recently appointed Chief Justice of India, Justice SH Kapadia, who is reportedly in favor of stopping it.

The question is whether we need to incorporate better practices in the process or scrap the process altogether,

TDS refundable not shown/claimed in return of income Merely because assessee h

 

TDS refundable not shown/claimed in return of income

Merely because assessee has not claimed refund in return form itself, it cannot be said that assessee is not entitled to refund.

- Vide Indglonal Investment & Finance Ltd. v. Income Tax Officer (2012) 43 (I) ITCL 529 (Del-HC)

(ITR (TRIB) Volume 17 : Part 2 (Issue dated : 16-07-2012) : SUBJECT INDEX TO CASES REPORTED IN THIS PART

ITR’S TRIBUNAL TAX REPORTS (ITR (TRIB))

Volume 17 : Part 2 (Issue dated : 16-07-2012)

SUBJECT INDEX TO CASES REPORTED IN THIS PART

Agricultural income --Fact of ownership of agricultural land not disputed--Claim for deduction of expenses for agriculture allowed--No evidence that agricultural operations were not performed--Income was agricultural--Income-tax Act, 1961, s. 10(1)-- Thangamani Vinodhagan v. Asst. CIT (Chennai) . . . 230

----Rose plants grown in green house--Mother plants grown in agricultural land using human labour --Income from rose flowers exempt as agricultural income--Income-tax Act, 1961, ss. 2(1), 10(1)--Circular No. 1, dated 27-3-2009-- CIT (Dy.) v. Best Roses Biotech P. Ltd. (Ahmedabad) . . . 211

Appeal to Appellate Tribunal --Powers of Tribunal--Power to admit additional ground of appeal--Question regarding limitation can be raised for first time before Tribunal--Income-tax Act, 1961-- Crompton Creaves Ltd. v. Dy. CIT (Mumbai) . . . 151

Business expenditure --Expenditure for purpose prohibited by law--Assessee exporting rice to Iraq under oil for food programme of United Nations--Paying commission to company for services in connection with export from procurement to final realisation of proceeds--Report by U. N. committee probing irregularities that company to which assessee paid commission was front company for Iraqi regime and payment used as kickback--Payment to Iraqi regime by agent not under assessee™s control--No denial that services rendered--No material to show assessee knew and was part of scheme to pay kickbacks to Iraqi regime--Payment deductible--Income-tax Act, 1961, s. 37, Expln. -- CIT (Dy.) v. Rajrani Exports P. Ltd. (Kolkata) . . . 239

Cash credits --Amounts repaid by debtors--Debtors not denying transaction--Amount not includible in assessee™s total income--Amount claimed to be advanced by sister--No evidence of such advance--Amount includible in total income of assessee--Income-tax Act, 1961, s. 68-- Thangamani Vinodhagan v. Asst. CIT (Chennai) . . . 230

Company --Book profits--Computation--Minimum alternate tax--Deduction from net profit on account of foreign exchange fluctuation--No adjustment available except as provided in Explanation --Reduction of amount while computing book profit--Not permissible--Income-tax Act, 1961, s. 115JB-- City Gold Media Ltd. v. ITO (Ahmedabad) . . . 192

Deduction of tax at source --Payment to non-resident--Failure to deduct tax at source--No assessment proceedings against non-resident for four years--Assessee cannot be treated as assessee in default under section 201--Income-tax Act, 1961, ss. 195, 201-- Crompton Creaves Ltd. v. Dy. CIT (Mumbai) . . . 151

Heads of income --Capital gains or business income--Proprietary concern of assessee taken over by company as going concern--Consideration for transfer is taxable as long-term capital gains--Assessee employed by company on salary and other terms of employment--Not a case of compensation for not engaging in similar business--Income-tax Act, 1961, ss. 28(va), 50B-- CIT (Asst.) v. Sangeeta Wij (Smt.) (Delhi) . . . 162

Income --Computation of income--Disallowance of expenditure relating to non-taxable income from firm--Borrowed amount invested as capital of firm--Interest relating to share of profit to be disallowed--Income-tax Act, 1961, s. 14A-- CIT (Asst.) v. Vinay Singal (Chandigarh) . . . 146

Penalty --Concealment of income--Capital gains--Claim for exemption--Investment of net consideration in residential property--Shortfall in amount invested due to wrong advice by counsel--No concealment of income--Penalty cannot be imposed --Income-tax Act, 1961, ss. 54, 271(1)(c)-- Majorjit Singh v. Asst. CIT (Chandigarh) . . . 183

----Failure to respond to notice under section 143(1) and (2)--Bona fide belief that income was non-taxable--Not reasonable explanation--Penalty imposable--Income-tax Act, 1961, s. 271(1)(b)-- Thangamani Vinodhagan v. Asst. CIT (Chennai) . . . 230

Rectification of mistakes --Depreciation--Withdrawal of deprecation on ground of non-user--Question debatable--Depreciation cannot be withdrawn in rectification proceedings--Income-tax Act, 1961, ss. 32, 154-- Thangamani Vinodhagan v. Asst. CIT (Chennai) . . . 230

Revision --Commissioner--Reassessment--Financial charges paid on funds borrowed for purchase of property--Part of closing stock--No finding that Assessing Officer applied his mind to facts of case--Direction to Assessing Officer to examine issue--Proper--Income-tax Act, 1961, s. 263-- Devi Developers P. Ltd. v. CIT (Delhi) . . . 187

Transfer pricing --Depreciation--Method of computing depreciation--No difference in result as a result of applying any of methods--Income-tax Act, 1961, s. 92C-- Lason India P. Ltd. v. Asst. CIT (Chennai) . . . 203

----Draft assessment order incorporating proposals of Transfer Pricing Officer--Draft assessment order erroneously termed final order--Assessing Officer has power to issue corrigendum to correct error--Income-tax Act, 1961, s. 144C-- Lason India P. Ltd. v. Asst. CIT (Chennai) . . . 203

Unexplained expenditure --Addition based on statement of director recorded by Central excise authorities--Addition not supported by evidence--Addition not justified --Additions under section 69C set aside by Tribunal in assessment year 2004-05--No new facts in assessment year 2008-09--Addition not valid--Income-tax Act, 1961, s. 69C -- ITO v. Arora Alloys Ltd. (Chandigarh) . . . 133

SECTIONWISE INDEX TO CASES REPORTED IN THIS PART

Income-tax Act, 1961 :

S. 2(1) --Agricultural income--Rose plants grown in green house--Mother plants grown in agricultural land using human labour --Income from rose flowers exempt as agricultural income--Circular No. 1, dated 27-3-2009-- Deputy CIT v. Best Roses Biotech P. Ltd. (Ahmedabad) . . . 211

S. 10(1) --Agricultural income--Fact of ownership of agricultural land not disputed--Claim for deduction of expenses for agriculture allowed--No evidence that agricultural operations were not performed--Income was agricultural-- Thangamani Vinodhagan v. Asst. CIT (Chennai) . . . 230

Agricultural income--Rose plants grown in green house--Mother plants grown in agricultural land using human labour --Income from rose flowers exempt as agricultural income--Circular No. 1, dated 27-3-2009-- Deputy CIT v. Best Roses Biotech P. Ltd. (Ahmedabad) . . . 211

S. 14A --Income--Computation of income--Disallowance of expenditure relating to non-taxable income from firm--Borrowed amount invested as capital of firm--Interest relating to share of profit to be disallowed-- Asst. CIT v. Vinay Singal (Chandigarh) . . . 146

S. 28(va) --Heads of income--Capital gains or business income--Proprietary concern of assessee taken over by company as going concern--Consideration for transfer is taxable as long-term capital gains--Assessee employed by company on salary and other terms of employment--Not a case of compensation for not engaging in similar business-- Asst. CIT v. Sangeeta Wij (Smt.) (Delhi) . . . 162

S. 32 --Rectification of mistakes--Depreciation--Withdrawal of deprecation on ground of non-user--Question debatable--Depreciation cannot be withdrawn in rectification proceedings-- Thangamani Vinodhagan v. Asst. CIT (Chennai) . . . 230

S. 37, Expln .-- Business expenditure--Expenditure for purpose prohibited by law--Assessee exporting rice to Iraq under oil for food programme of United Nations--Paying commission to company for services in connection with export from procurement to final realisation of proceeds--Report by U. N. committee probing irregularities that company to which assessee paid commission was front company for Iraqi regime and payment used as kickback--Payment to Iraqi regime by agent not under assessee™s control--No denial that services rendered--No material to show assessee knew and was part of scheme to pay kickbacks to Iraqi regime--Payment deductible-- Deputy CIT v. Rajrani Exports P. Ltd. (Kolkata) . . . 239

S. 50B --Heads of income--Capital gains or business income--Proprietary concern of assessee taken over by company as going concern--Consideration for transfer is taxable as long-term capital gains--Assessee employed by company on salary and other terms of employment--Not a case of compensation for not engaging in similar business-- Asst. CIT v. Sangeeta Wij (Smt.) (Delhi) . . . 162

S. 54 --Penalty--Concealment of income--Capital gains--Claim for exemption--Investment of net consideration in residential property--Shortfall in amount invested due to wrong advice by counsel--No concealment of income--Penalty cannot be imposed-- Majorjit Singh v. Asst. CIT (Chandigarh) . . . 183

S. 68 --Cash credits--Amounts repaid by debtors--Debtors not denying transaction--Amount not includible in assessee™s total income--Amount claimed to be advanced by sister--No evidence of such advance--Amount includible in total income of assessee-- Thangamani Vinodhagan v. Asst. CIT (Chennai) . . . 230

S. 69C --Unexplained expenditure--Addition based on statement of director recorded by Central excise authorities--Addition not supported by evidence--Addition not justified--Additions under section 69C set aside by Tribunal in assessment year 2004-05--No new facts in assessment year 2008-09--Addition not valid-- ITO v. Arora Alloys Ltd. (Chandigarh) . . . 133

S. 92C --Transfer pricing--Depreciation--Method of computing depreciation--No difference in result as a result of applying any of methods-- Lason India P. Ltd. v. Asst. CIT (Chennai) . . . 203

S. 115JB --Company--Book profits--Computation--Minimum alternate tax--Deduction from net profit on account of foreign exchange fluctuation--No adjustment available except as provided in Explanation --Reduction of amount while computing book profit--Not permissible-- City Gold Media Ltd. v. ITO (Ahmedabad) . . . 192

S. 144C --Transfer pricing--Draft assessment order incorporating proposals of Transfer Pricing Officer--Draft assessment order erroneously termed final order--Assessing Officer has power to issue corrigendum to correct error-- Lason India P. Ltd. v. Asst. CIT (Chennai) . . . 203

S. 154 --Rectification of mistakes--Depreciation--Withdrawal of deprecation on ground of non-user--Question debatable--Depreciation cannot be withdrawn in rectification proceedings-- Thangamani Vinodhagan v. Asst. CIT (Chennai) . . . 230

S. 195 --Deduction of tax at source--Payment to non-resident--Failure to deduct tax at source--No assessment proceedings against non-resident for four years--Assessee cannot be treated as assessee in default under section 201-- Crompton Creaves Ltd. v. Deputy CIT (Mumbai) . . . 151

S. 201 --Deduction of tax at source--Payment to non-resident--Failure to deduct tax at source--No assessment proceedings against non-resident for four years--Assessee cannot be treated as assessee in default under section 201-- Crompton Creaves Ltd. v. Deputy CIT (Mumbai) . . . 151

S. 263 --Revision--Commissioner--Reassessment--Financial charges paid on funds borrowed for purchase of property--Part of closing stock--No finding that Assessing Officer applied his mind to facts of case--Direction to Assessing Officer to examine issue--Proper-- Devi Developers P. Ltd. v. CIT (Delhi) . . . 187

S. 271(1)(b) --Penalty--Failure to respond to notice under section 143(1) and (2)--Bona fide belief that income was non-taxable--Not reasonable explanation--Penalty imposable-- Thangamani Vinodhagan v. Asst. CIT (Chennai) . . . 230

S. 271(1)(c) --Penalty--Concealment of income--Capital gains--Claim for exemption--Investment of net consideration in residential property--Shortfall in amount invested due to wrong advice by counsel--No concealment of income--Penalty cannot be imposed-- Majorjit Singh v. Asst. CIT (Chandigarh) . . . 183