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Case Laws
Showing 381 to 400 of 422 Records
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1999 (7) TMI 42 - BOMBAY HIGH COURT
Business Expenditure, Company, Expenditure ... ... ... ... ..... payments made to directors as directors (qua director) fall within section 40(c). Payments made in consideration of a valuable right parted with by the directors of the assessee-company in favour of the assessee-company are outside the scope of the said section. In the facts. of this case, there is no controversy in regard to the factum of genuineness of the payment or the reasonableness thereof having regard to the legitimate business needs of the assessee. Since the dispute in regard to the scope and ambit of section 40(c) of the Income-tax Act is put to rest by the above decision of the Supreme Court which is followed by this court in Pai Paper and Allied Industries P. Ltd. v. CIT 1994 207 ITR 410, we answer the question referred to us in the aforestated terms, i.e., the commission of Rs. 1,24,969 paid by the assessee to Parekh and Co., would neither be covered under section 40A(5) nor under section 40(c). The reference is disposed of accordingly with no order as to costs.
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1999 (7) TMI 41 - BOMBAY HIGH COURT
Interest On Borrowed Capital, Rate Of Interest, Disallowance ... ... ... ... ..... ceased to be payable to the trust under the agreement. In the instant case, the amount was credited to the account of the trust. No amount was paid to the trust in the past. It could have been paid. There was no legal bar on that. In any event, the amount of loan with accumulated finance charges was the amount due to the trust which the trust was free to withdraw at any time and invest in whatever manner it thought fit. The trust was, therefore, entitled to interest on the amount outstanding to its credit in the accounts of the assessee. That being so, the finance charges should have been calculated on the outstanding amount of loan with accrued finance charges. The Tribunal, in our opinion, was justified in saying so. We do not find any infirmity in the finding of the Tribunal. We, therefore, answer the question referred to us in the affirmative, i.e., in favour of the assessee and against the Revenue. The reference stands disposed of accordingly with no order as to costs.
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1999 (7) TMI 40 - DELHI HIGH COURT
Business Expenditure, Travel Expenditure, New Industrial Undertaking, Special Deduction ... ... ... ... ..... earned counsel for the assessee that the Central Board of Direct Taxes has accepted the interpretation placed on the phrase per annum by the Madras and Karnataka High Courts and vide its Circular F. No. 178/227/83-IT(AI), dated March 3, 1984, has issued instructions that deduction under section 80J should not be reduced proportionately with reference to the period for which the business of the undertaking was not carried on during the relevant previous year. Following the views expressed in the aforenoted decisions, with which we are in respectful agreement and in the light of the circular issued by the Board, we also hold that the assessee was entitled to relief under section 80J of the Act for the whole year ended on June 30, 1969, irrespective of the fact that it had commenced production only on February 1, 1969. Accordingly, the third question is also answered in the affirmative, i.e., in favour of the assessee and against the Revenue. There will be no order as to costs.
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1999 (7) TMI 39 - DELHI HIGH COURT
Reference, Tax Deducted At Source, Interest ... ... ... ... ..... o tax was chargeable on the French portion of the salary. From a bare reading of the order of the Tribunal it is evident that question No. 1 does not arise out of the said order. The Tribunal has nowhere expressed its view on the question whether the amendment of section 9(1)(ii) of the Act is prospective or retrospective. It has merely observed that prior to the said amendment the assessee was under the bona fide belief and that no tax was chargeable on the aforenoted portion of the salary paid to its employees outside India. We find that the finding recorded by the Tribunal to the effect that the assessee was under a bona fide belief that it was not liable to deduct tax has not been challenged by the Revenue in the proposed question No. 1. In this view of the matter proposed question No. 2 is rendered academic. We do not find any infirmity in the order of the Tribunal declining to refer the aforenoted questions to this court. The petition fails and is accordingly dismissed.
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1999 (7) TMI 38 - MADHYA PRADESH HIGH COURT
Wealth Tax, Appeal To Tribunal, Powers Of Tribunal ... ... ... ... ..... . It may as well be that the plea of the property comprising two houses was taken for the first time before the Tribunal but this did not constitute a separate subject-matter than the one under appeal. Therefore, even if it was to be treated as a new plea or ground, touching the subject-matter of appeal to that extent the Tribunal was justified in entertaining it and remanding the matter to the Wealth-tax Officer for reassessment. Such a course could not be said to be causing any prejudice to the assessee. Nor can it be said or held that he was taken by any surprise in the matter causing any prejudice to him in the process. We accordingly hold that the Tribunal was justified in entertaining the plea/ground raised by the Revenue so long as it touched the subject-matter of appeal before it and since it did not cause any prejudice to the assessee in the process. The two questions referred are accordingly answered in the affirmative and this reference is disposed of accordingly.
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1999 (7) TMI 37 - MADRAS HIGH COURT
Depreciation, Previous Year, Change In Previous Year, Extra Shift Allowance, Depreciation, Capital Gains, Computation Of Capital Gain
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1999 (7) TMI 36 - CALCUTTA HIGH COURT
Depreciation, Capital Gains, Computation Of Capital Gain ... ... ... ... ..... ssment years 1978-79 and 1979-80. Therefore, we answer the common question in both the years whether the Tribunal was justified in upholding the direction of the Commissioner of Income-tax (Appeals) to withdraw the depreciation on assets allowed by the Income-tax Officer in the affirmative, that is, in favour of the assessee and against the Revenue. The question referred for the assessment year 1979-80 is whether the Tribunal was justified in upholding the order of the Commissioner of Income-tax (Appeals) directing computation of capital gain/loss on the sale of assets either by taking into consideration the original cost of the assets or their written down value after giving effect to his appellate order. This question is consequential to the question we have answered earlier. Therefore, we answer this question also in the affirmative, that is, in favour of the assessee and against the Revenue. The application is, accordingly, disposed of. RANJAN KUMAR MAZUMDAR J.--I agree.
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1999 (7) TMI 35 - ANDHRA PRADESH HIGH COURT
Application For Reference, Delay In Filing Application ... ... ... ... ..... the proviso therein contemplates condoning the delay up to a period of 30 days. It is evident from the affidavit that the delay has occurred due to misplacement and not tracing the original order in the office of counsel. Normally, as laid down in various pronouncements, the delay aspect has to be liberally considered so as to provide an opportunity to the parties to have a decision on the merits. In this case, the Tribunal fell into error in expecting the explanation for delay even for the days within the limitation period. Moreover, a party should not suffer for the lapses on the part of counsel, especially when the delay is not too long. The explanation and the reasons given in the affidavit do not give scope for any doubt as to bona fides. In view of the above, the application needs to be allowed by giving an opportunity to the petitioner for seeking reference. The impugned order is set aside and the delay is condoned. The writ petition is allowed accordingly. No costs.
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1999 (7) TMI 34 - MADHYA PRADESH HIGH COURT
Penalty, Concealment Of Income, Burden Of Proof, Assessment, Levy Of Penalty, Revised Returns
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1999 (7) TMI 33 - PUNJAB AND HARYANA HIGH COURT
Acquisition Of Immovable Property ... ... ... ... ..... SC) none of the petitioners raised any objection to their cases being transferred and in fact they submitted to the jurisdiction of the Income-tax Officer to whom their cases had been transferred. They challenged the order of transfer only after the decision of the Supreme Court in Bidi Supply Co. vs Union of India 1956 29 ITR 717. It was in this situation held that the assessee acquiesced in the jurisdiction of the Income-tax Officer to whom their cases were transferred and therefore they were not entitled to invoke the jurisdiction of the Supreme Court under article 32 of the Constitution of India. Thus the contention that the order of transfer made by the Commissioner is unconstitutional and void was repelled. This however is not the situation in the present case and therefore counsel for the Revenue cannot seek any assistance from this decision of the Supreme Court. For the reasons recorded above the present appeals of the Revenue are dismissed with no order as to costs.
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1999 (7) TMI 32 - PATNA HIGH COURT
Prosecution, Offence, Mens Rea ... ... ... ... ..... is made out. I have already noticed above that the appellate authorities as also the Tribunal have not recorded a finding that there was wilful attempt on the part of the petitioner to evade any tax and merely because the ITO did not accept the correctness of the account of the assessee and made additions in two accounts on estimate basis, the findings arrived at by the ITO could not have held the petitioner liable for making a false statement of s. 277 of the Act in no way is attracted in the case at hand. For the reasons and discussions above and also in view of the legal proposition mentioned above, it is held that there is no wilful evasion on the part of the petitioners and since the additions made by the assessing authority has not been sustained in toto, the prosecution launched against the petitioners is wholly unwarranted and it is not sustainable in law, I, therefore, allow this application and quash the entire criminal prosecution launched against the petitioner.
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1999 (7) TMI 31 - MADRAS HIGH COURT
Export Markets Development Allowance, Weighted Deduction ... ... ... ... ..... nditure, as such report was not obtained as part of documentation packages, but in a contract covering comprehensive restructuring of the business involved. No new line of business was started on the strength of the report of the consultants. That report was not regarded as essential part for any new business that the assessee commenced thereafter. In the circumstances of the case, the expenditure incurred by the assessee in obtaining that report was clearly an expenditure of revenue character. It is not only permissible but is also necessary for any business to update its own knowledge and adopt better ways of organising its business if it is to survive in the market. The expenditure incurred for such purpose cannot be regarded as capital expenditure and is only a revenue expenditure. The question therefore referred to us is answered in favour of the assessee and against the Revenue. The assessee shall be entitled to costs in the sum of Rs. 1,000 (rupees one thousand only).
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1999 (7) TMI 30 - ANDHRA PRADESH HIGH COURT
Royalty, Law Applicable ... ... ... ... ..... ted the said Explanation above. A perusal of the said Explanation makes it clear that it contemplates an agreement entered into after April 1, 1976, but the proposals ire approved by the Central Government prior to April 1, 1976, and it should also satisfy the conditions mentioned therein. On the facts of the present case we are of the view that it is not a case where the agreement was entered into after April 1, 1976. Therefore, the question of applicability of the said Explanation does not arise. In view of the above we reject the contention of learned standing counsel for the Revenue that the assessee is liable under Explanation 1 to the proviso under section 9(1)(vi) of the Act. In the light of the above, question No. 1 does not arise out of the order of the Tribunal. Question No. 2 is answered in the affirmative and in favour of the assessee. Questions Nos. 3 and 4 are also answered in favour of the assessee and in the affirmative. The reference is answered accordingly.
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1999 (7) TMI 29 - DELHI HIGH COURT
Revision, Commissioner, Scope Of Powers, Penalty ... ... ... ... ..... he Income-tax Act, 1961, to the Income-tax Officer to initiate penalty proceedings under section 271(1)(a) of the Act, against the assessee for the assessment year 1970-71 ? In so far as this court is concerned the issue raised is no longer res integra. The scope of powers of the Commissioner under section 263 of the Act came up for consideration before this court in Addl. CIT v. J.K.D Costa 1982 133 ITR 7, and it was held that even if, while examining the records of an assessment order in exercise of his powers of revision under the said section, the Commissioner finds that the Assessing Officer has not initiated because penalty proceedings are not a part of assessment proceedings. It was, thus, held that the Commissioner cannot pass an order under section 263 of the Act pertaining to penalty. Following the said judgment, with which we are in respectful agreement, the question is answered in the affirmative, i.e., in favour of the assessee and against the Revenue. No costs.
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1999 (7) TMI 28 - KARNATAKA HIGH COURT
Offences And Prosecution ... ... ... ... ..... re. Under the proviso, the Chief Commissioner or the Director-General may also give direction for institution of prosecution proceedings. This is an additional power which has been conferred on the Chief Commissioner or the Director-General who may or may not give the direction. If the directions are not given to the Commissioner or the Commissioner (Appeals), it does not mean that the Commissioner or the Commissioner (Appeals) or the appropriate authority has no jurisdiction to give the sanction for prosecution. Prior to 1989, it was only the Commissioner who was empowered to give the sanction and, therefore, the contention that, in the absence of any directions or instructions being given by the Chief Commissioner, the Commissioner has no power to sanction the prosecution has no substance. The writ petitions having no substance, are accordingly dismissed. In respect of other matters, the petitioners would be free to raise the objections before the court having jurisdiction.
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1999 (7) TMI 27 - SIKKIM HIGH COURT
Reassessment, Writ, High Court, Jurisdiction ... ... ... ... ..... 89. From the document seized at the time of the search, the Assessing Officer had entertained the belief that though the company was registered in Sikkim, its activities of profits were carried out from Delhi and the income accrued and arose in Delhi and that the head and brain of the company was situated at Delhi. It was also found that no office was running at the registered office of the company at Gangtok. There was only a sign board of the company at that address and the office remained mostly locked. In our view, from the documents seized as a result of the search and seizure operations carried out on March 15, 1990, the Assessing Officer had reason to believe that the income shown in the notices under section 148 was chargeable to tax and had escaped assessment. Thus, the petition has no merit. In the result, the petition is dismissed. The interim orders passed during the pendency of the petition stand vacated. In the circumstances, there shall be no order as to costs.
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1999 (7) TMI 26 - KERALA HIGH COURT
Export, Special Deduction, Business, Other Sources, Interest ... ... ... ... ..... f the Income-tax Act. The following observation in the above judgment is very relevant Profits and gains are well understood to mean only the business income, and not any other income. So long as the company has no business of lending money, and so long as the admitted case of the company is that the income derived is only on account of the peculiar situation arising from the time schedule for repayment of the loans, it cannot be stated that the income yielded by the deposits or investments was received in the course of the company s business so as to be treated as a business profit. The earlier decision of this court in.Collis Line Pvt. Ltd. v. ITO 1982 135 ITR 390 was referred to and approved. In the light of the above, we have no hesitation to hold that the income received by the assessee as interest from the fixed deposits with the bank is not business income, but only income from other sources. In the result, we find no merit in the appeals. The appeals stand dismissed.
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1999 (7) TMI 25 - MADRAS HIGH COURT
Export Markets Development Allowance, Weighted Deduction ... ... ... ... ..... interest payments, when admittedly, interest had been paid on the deposits received by the bank, and such payment amounted to expenditure for the purposes of the section. It is significant that the section refers to any expenditure . The use of the word any preceding the word expenditure would also indicate that the focus is on the expenditure actually incurred by way of outgo, and once it is established that such expenditure had been incurred there is no occasion for making any deductions therefrom on the ground that income had been received by that branch by the aid of the funds for securing which expenditure had been incurred. We, therefore, answer the question referred to us, viz., Whether, on the facts and in the circumstances of the case, the Tribunal was correct in law in holding that the assessee is entitled for weighted deduction under section 35B in respect of the gross interest payments made in foreign branches ? in favour of the assessee, and against the Revenue.
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1999 (7) TMI 24 - MADRAS HIGH COURT
Depreciation, Plant, Definition, Legislative Powers, Taxation, High Court ... ... ... ... ..... may not be any controversy in the claim for depreciation. Further, by virtue of the said amendment, the assessees would not be affected in a great manner as the power to reopen an assessment is regulated by other provisions of the Act and in so far as those cases which were pending on the basis of the decisions of the Tribunal, the assessments have not reached the stage of finality. Since the Legislature have stepped in to rectify the defect as soon as some of the Tribunals have rendered decisions holding that tea bushes should also be regarded as plant, the retrospective effect given to the definition for the term plant excluding tea bushes cannot be said to be in any way unreasonable or arbitrary. I do not find any reason to accept the submissions of learned senior counsel for the petitioner in this regard. In the result, the writ petitions are liable to be dismissed, and, accordingly, they are dismissed. The respondents are entitled to costs of a sum of Rs. 1,000 one set.
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1999 (7) TMI 23 - MADHYA PRADESH HIGH COURT
Reference, Cash Credits ... ... ... ... ..... by the Revenue and a part of it was disallowed. The assessee took an appeal to the Tribunal and explained that forums below had overlooked the record placed before them which showed that credits given to the assessee-company were duly declared by the creditors in the new returns. Upon this, the Tribunal concluded that the investment in the assessee-firm was duly explained and no addition was called for in the hands of the assessee and deleted the addition. The Revenue sought reference which was rejected. Hence, this application. It becomes clear that the Tribunal had accepted the explanation of the assessee which showed that the credit given was duly declared by the creditors in the new return, and, therefore, deletion of the addition was on the basis of the satisfaction reached by the Tribunal and on the appreciation of material before it. The matter accordingly does not give rise to any question of law warranting dismissal of this application which is accordingly dismissed.
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