|
Advanced Search Options
Income Tax - Case Laws
Showing 121 to 140 of 182 Records
-
2009 (3) TMI 215 - ITAT CALCUTTA-C
Disallowance on Payments made to the Munshis u/s. 40(a)(ia) - business of handmade Biri sticks - violation in view of the provisions laid down in s. 40(a)(ia) - CIT(A) held that the payment made to the Munshis are covered u/s.194H - HELD THAT:- In view of the fact that the Munshis are also part of the labourers and their payments are made on piece-rated workers at one lakh Biris. In our considered opinion, this cannot be considered as commission as defined in Explanation (i) to s. 194H. Therefore, the provisions of s. 194H are not applicable in the present facts of the case. Hence, we set aside the orders of CIT(A) and allow the ground taken by the assessee and dismiss the ground taken by the Revenue.
Disallowance on Commission payment to directors - C1T(A) deleted the disallowance made by the AO, observing that the commission paid to the directors is not in the nature of commission or brokerage as envisaged u/s.194H nor as fees for professional or technical services, considered in s. 194J.
HELD THAT:- Assessee company has paid this commission to the directors as per their terms of employment for the work done in their capacity as whole-time directors, this commission should have been treated as an incentive in addition to salary, bonus and other perquisites. Therefore, in our considered opinion, the order of CIT(A) is justified. Therefore, this ground of the Revenue is dismissed.
Disallowance of sales promotion (prize coupons) - We are of the considered view that CIT(A) is justified in coming to the opinion that there being no infringement of law, the expenses under consideration does not fall within the mischief of the Explanation to s. 37(1). Since the assessee is trying to increase the sales of its brand of Biris among the others available in the market and this expenditure will not fall within the mischief of prohibitory regulation introduced to curb proliferation of tobacco addiction in the society, which is harmful for the public health.
Ad hoc restriction of the disallowance and allowing balance as allowable expenditure to the assessee is not justifiable. In our considered opinion, the assessee is liable to substantiate the expenditure incurred by him on account of the said scheme at least even from the accounts of the agents from which the said expenditure has been reimbursed to the agents or adjusted from their commission.
Therefore, we consider it to set aside the issue to the file of the AO to redecide this issue, as per law and direct the assessee also to produce the relevant accounts of the different agents to the effect that the assessee has actually incurred the said expenditure against the said scheme. Thus, the issue raised by the Revenue as well as the assessee is allowed for statistical purposes.
Addition u/s. 40 (a)(ia) - expenditure incurred on carriage inward - It is observed that the assessee had not deducted tax at source in respect of expenditure payable/paid to the transport contractors of the said amount. Therefore, we are of the considered opinion that the action of the Revenue authorities is justifiable. Thus, we find no infirmity in the order of CIT(A) in confirming the addition made by AO. This ground of the assessee is rejected.
The appeal of the Revenue as well as the appeal of the assessee are deemed to be partly allowed for statistical purposes.
-
2009 (3) TMI 214 - ITAT BOMBAY-L
Income Escaping Assessment ... ... ... ... ..... iling a return being treated as an agent of the assessee, no specific order needs to be passed in this regard. 30. Our view is quite in line with the above observations. Reference was also made to the decision of ITAT K Bench Mumbai in the case of R. Lines Ltd., but both the parties agreed that above decision has no application to the facts of the case. Certain other decisions of the Tribunal were cited and relied upon before us by the learned counsel for the assessee. However, in those decisions, true meaning and import of expression treated as an agent under section 163 was not appreciated with reference to the case law we have considered in detail. For the above reasons, we deem it unnecessary to make detailed reference to them. 31. In the light of above discussion, we answer the question referred to Special Bench in the negative and in favour of the revenue and against the assessee. The matter may now be placed before the regular Bench for disposal in accordance with law.
-
2009 (3) TMI 213 - ITAT BOMBAY-E
Capital Or Revenue Receipt ... ... ... ... ..... respect of interest awarded by the Arbitration Tribunal, the arguments of learned counsel for the assessee that it is attached to the compensation awarded by the Tribunal and hence, it partakes the character of the compensation, which cannot be accepted. It is well-settled principle that interest always bears the character of the revenue unless it is awarded as profit. In the present case, it is found that no-where it is claimed by the assessee before the Arbitration Tribunal that the interest should be awarded as mesne profit but on interpretation of the award, in our opinion, interest is for the loss to assessee for delay in receipt of compensation, which the assessee was entitled to receive right in the year in which breach occurred. On this issue, we uphold the order of learned CIT(A) and hold that the AO has rightly treated the interest element as revenue receipt. 26. In the result, the appeal of the assessee is dismissed and the appeal of the Revenue is partly allowed.
-
2009 (3) TMI 186 - HIGH COURT OF GUJARAT
Tax Audit - Penalty u/s 271B - Audit u/s 44AB - inclusion of deemed turnover for the purpose of calculation of monetary limit of Tax Audit - The Assessing Officer was of the view that in terms of provisions of Section 44AB of the Income Tax Act, 1961 (the Act), the Assessee was under an obligation to get its accounts audited because the total amount of advances during the year under consideration constitute the turnover of the assessee which exceeded the stipulated limit of Rs.40 lacs. As the audit report had not been filed by the assessee, a show cause notice was issued on 05.11.1992. The assessee filed reply on 12.11.1992 contending that provisions of Section 44AB of the Act are not applicable in its case because the Gross Receipts did not exceed the sum of Rs.40 lacs. The said contention was not accepted by the Assessing Officer and penalty of Rs.72,451/- was levied under the provisions of Section 271B of the Act. - held that - In fact, on a reading of provisions of Section 44AB of the Act, it is a moot question as to which of the three phrases can be said to be applicable in a given case, and the same would depend on facts of each case and no straight jacket formula can be evolved in this context. Accordingly, the assessee was entitled to contend that when the terms Turnover and Gross Receipts are separated by the use of word or, the assessee would be entitled to bonafidely believe that Gross Receipts would constitute the basis for ascertaining the limit of Rs.40 lacs so as to attract Section 44AB of the Act.
-
2009 (3) TMI 157 - ALLAHABAD HIGH COURT
Notice for re assessment - writ petition for challenging the notice under section 147 of the Income-tax Act, 1961 – assessee claimed that notice has been issued beyond the maximum period of six years fixed under section 149(b) of the Act, therefore, the notice is ex facie bad in law. According to him, the notice has been issued for the assessment year 2002-03 – held that - It is correct to say that if the issuance of notice or passing of any order is absolutely without jurisdiction, alternative remedy cannot be held to be bar but when factually we find that the period of six years under section 149(b) of the Act is not expired, we cannot hold and say that the issuance of notice on account of escapement of assessment is absolutely beyond jurisdiction - Alternatively, right to challenge the decision of the Assessing Officer by the assessee is composite in nature which includes the nature of subjective satisfaction by the Joint Commissioner. Therefore, at this stage we do not find any reason to interfere with the notice – writ petition dismissed
-
2009 (3) TMI 156 - KERALA HIGH COURT
Assessment u/s 158BC versus 158BD – assessment against warrant or without warrant - Assessment was one completed under section 158BC of the Income-tax Act, 1961, after search conducted in the residential premises of the partner of the assessee-firm and after conducting survey in the business premises of the assessee on the same day. In first appeal, the assessee contested the validity of the assessment under section 158BC and the additions on the merits. The Commissioner of Income-tax (Appeals) allowed the appeal by holding that the assessment should have been made under section 158BD as the search was not pursuant to warrant issued in the name of the assessee-firm – ITAT maintained the order of CIT(A) – held that - This order of the Tribunal is patently wrong and unsustainable because the very same Bench in the subsequent order issued in the name of the partner held that warrant was in the name of the firm and not against the partner – matter remanded
-
2009 (3) TMI 132 - GUJARAT HIGH COURT
Liability on account of arbitration award - Whether the liability of Rs. 7,14,824 arising under the arbitration award against the appellant declared in the assessment year 1988-89 had not accrued in that year only because the award was challenged in appeal by the assessee and, therefore, was not allowable in the assessment year 1988-89? – Held that - Admittedly, the assessee is following the mercantile system of accounting. On May 28, 1987, when the Trade Association made an award for damages for breach of contract the liability to pay such damages had already been incurred by the assessee. Merely because the award was challenged in appeal by the assessee cannot be a ground for holding that the liability had not been incurred – ITAT has committed an error - the liability arose in the hands of the assessee and merely because the award was challenged that fact did not make the award unenforceable in law. The assessee was accordingly held entitled to claim deduction in the said case – decided in favor of assessee
-
2009 (3) TMI 131 - PUNJAB AND HARYANA HIGH COURT
Cash Loan - Penalty u/s 271D and 271E – Violation of section 269SS – Held that - assessee had produced his cash books, depicting loans taken by him unilaterally before the Revenue - no prejudice was caused to the Revenue - assessee did not attempt by the impugned act to avoid any tax liability - there is no dispute about the fact that the instant cash transactions of the respondent assessee were with the sister concern and that these transactions were between the family and due to business exigency - A family transaction, between two independent assessees, based on an act of casualness, specially in a case where the disclosure thereof is contained in the compilation of accounts and which has no tax effect, in our view establishes “reasonable cause” under section 273B of the Act. Since the respondent assessee had satisfactorily established “reasonable cause” u/s 273B of the Act he must be deemed to have established sufficient cause for not invoking the penal provisions (sections 271D and 271E of the Act) against him – penalty set aside.
-
2009 (3) TMI 128 - CALCUTTA HIGH COURT
Transfer of Cases – pwer under section 127(2)(a) - the petitioners by letters furnished on January 27, 2009, had filed detailed objections, those have not been considered. Though simultaneous searches were not conducted as evident from panchnama, yet transfers have been directed on the said basis – AO stated that petitioners have business connection with their father, the stand taken in the order – held that - the onus has been put on the petitioners to produce material evidence that they are not connected with their father. Rather had the respondents any evidence in support of their case they should have furnished the same. - mere family connection cannot be a ground for transfer – order of transfer set aside and quashed.
-
2009 (3) TMI 127 - CALCUTTA HIGH COURT
Transfer of Cases – Section 127 - It is to be noted that the respondents have tried to justify the order transfer by supplementing reasons in their affidavit-in-opposition. In my view, the validity of an order has to be judged from the order itself. If the affidavit filed by the respondents justifying the reasons for such transfer is accepted, then the order of transfer which is not within the parameters of section 127 may get validated by the additional grounds later brought by way of affidavit which, in my view, cannot be done. Therefore, the writ petition is allowed. Hence, the order of transfer dated January 19, 2007, is set aside and quashed. Consequential proceedings are also quashed. The application is also disposed of accordingly
-
2009 (3) TMI 126 - KARNATAKA HIGH COURT
Conversion of agricultural land into industrial use and residential plots – AO concluded that the assessee was carrying on an adventure in the nature of a trade and, therefore, was liable to be taxed under the head “Income from business” and not under the head “Income from capital gains” – held that - taking into consideration the nature of the transaction, it cannot be said by any stretch of imagination that there was any intention to make the profit and even otherwise we do not find that the transaction was in the nature of trade. It is in the context of these circumstances that the Commissioner of Income-tax (Appeals) and also the Income-tax Appellate Tribunal concurrently held that it is not in the nature of a trade and the profit earned thereby cannot be under the head “Business” and it has to be under the head “Capital gains.” – Order of CIT(A) and ITAT maintained – appeal dismissed.
-
2009 (3) TMI 117 - BOMBAY HIGH COURT
Industrial Undertaking - The expression “manufacture” or “production” are different expressions and the word “production” has a wider meaning - the word “production” under section 10B considering similar expression in section 80IB will have to be given this wider meaning, considering that the expressions are not defined in the Act but the expressions are used in the same Act. The only difference between section 80-IB and section 10B is that section 10B applicable to a 100 per cent. export oriented unit, whereas section 80-IB can be in respect of any unit – held that the cutting, polishing and sizing granites amounted to either manufacturing or processing and accordingly, the assessee was entitled for deduction under section 10B of the Income-tax Act.
-
2009 (3) TMI 94 - CALCUTTA HIGH COURT
Imposition of penalty u/s 271(1)(c) - by reason of concealment or furnishing of inaccurate particulars alone, the assessee does not ipso facto become liable for penalty - Imposition of penalty is not automatic - not only is the levy of penalty discretionary in nature but the discretion is also required to be exercised on the part of the Assessing Officer keeping the relevant factors in mind - revenue appeal dismissed - application for condonation of delay is also dismissed as no sufficient cause has been shown for delay of 202 days
-
2009 (3) TMI 91 - BOMBAY HIGH COURT
Depreciation - Business of leasing – Leased equipment - contention of the assessee that the breakers were given on lease before the end of previous year and therefore, the same should be considered as “used” for the purpose of business - Assessee, admittedly had supplied the machinery before the end of the financial year and the assessee had received the lease rentals for the same. The fact whether the lessee had put to use the leased equipment would be irrelevant – revenue’s appeal dismissed – Tribunal is right in allowing the assesses claim of deprecation
-
2009 (3) TMI 88 - HIGH COURT OF KERALA
The demand of interest tax paid on finance charges was allowed in I.T. assessment by way of rectification of original assessment, when the assessee in fact paid the interest tax on finance charges. However, the assessee successfully contested the interest tax assessment on finance charges and got it deleted. Thereafter income tax assessment was again rectified by the assessing officer withdrawing the deduction granted on interest tax on finance charges which the assessee ceased to be entitled by virtue of the order of the Tribunal in the interest tax appeals filed by the assessee. - ITAT held that the provisions of section 154 is not applicable to this case - honorable HC upheld the decision of ITAT on technical ground of double taxation (without going into merits)
-
2009 (3) TMI 87 - CALCUTTA HIGH COURT
Jurisdiction of AO to pass an order u/s 154 amending the intimation u/s 143(1)(a) and to make a prima facie adjustment in an intimation issued – held that Tribunal was not justified in holding that disallowance u/s 43B in respect of provident fund contribution, could be made as a prima facie adjustment u/s 143 (1) (a) – Tribunal was not justified in law in not deciding the contention of assessee that the order under Section 154 and revised intimation both were barred by limitation - assessee’s appeal allowed
-
2009 (3) TMI 86 - CALCUTTA HIGH COURT
Additions on basis of materials seized from third party - genuineness and veracity of the materials (letters) seized from a third party - On the basis of the said three letters, AO held that in the assessment order, the consideration for the sale of the moveable assets were raised from Rs.1 crore to Rs.1.50 crore by the parties – CIT (A) rightly accepted the assessee’s alternative contention that even assuming the money had changed hands but, neither the assessee nor the Special Officer appointed by HC have received the same - No corroborative evidence was found in the hands of the Assessing Officer and, therefore, in our considered opinion, the Assessing Officer without issuing such summons to the person concerned or making him available for cross-examination on the basis of the said letter proceeded in the matter - Therefore, addition on that account was required to be considered in the hands of the beneficial owner but it appears that without any reason the Tribunal dismissed the said contention - assessee must get a chance to prove the facts - matter remanded to AO
-
2009 (3) TMI 82 - MADRAS HIGH COURT
Provision for doubtful debts and the provision for leave encashment – revenue contend that the liability was only a contingent liability and not an ascertained/determined liability, so it is not allowable - issue involved in this appeal is squarely covered by the judgment of the Supreme Court in the case of BHARAT EARTH MOVERS VS. CIT (2000 (8) TMI 4 - SUPREME Court) which is decided in favour of the assessee. Therefore, we are of the view that the Tribunal is correct in following the judgment of the Supreme Court and allowing the assessee’s appeal
-
2009 (3) TMI 80 - MADRAS HIGH COURT
Rendering of the commercial service and receiving commission in foreign exchange – during reassessment, claim for benefit u/s 80O was denied by AO - Tribunal allowed the appeal of the assessee for A.Y. 1994-95 and 1995-96 on the ground that the re-assessment was not in accordance with Section 147 and was made on change of opinion - In respect of the other two assessment years also, the Tribunal allowed the assessee's appeal on the ground that the activity of the assessee comes within the purview of Section 80-O as decided by the Delhi Bench in CAPTAIN K.C.SAIGAL (1995 (4) TMI 95 - ITAT DELHI) and the receipt of commission in foreign exchange in India itself cannot deny the benefit to the assessee in view of the judgment of SC in the case of J.B.BODA AND CO. PVT. LTD. (1996 (10) TMI 70 - SUPREME Court) – held that there is no infirmity in order of tribunal
-
2009 (3) TMI 79 - PUNJAB AND HARYANA HIGH COURT
SCN issued proposing to hold special audit u/s 142(2A) – petitioner- trust has approached this Court under Article 226 of the Constitution with a prayer for quashing SCN - petitioner-Trust has also challenged the order referring the matter to Special Auditor, being totally arbitrary and contrary to Article 14 of the Constitution – records reveals that there are discrepancies in book of account of petitioner – neither petitioner appeared before AO nor any information was sent despite the fact that it was duly informed that time barring assessment is involved - argument of petitioner that special audit has been ordered to gain more time, is not impressive - writ petition is wholly misconceived and the same is dismissed
....
|
