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Case Laws
Showing 81 to 100 of 110 Records
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1978 (10) TMI 31 - PUNJAB AND HARYANA HIGH COURT
Family Hotchpot, Family Property, Partner In Firm ... ... ... ... ..... e bound to follow. A partner in the firm is a partner. It is wholly immaterial whether his share is because of investment in the capital or otherwise. Share of a partner in the firm is his asset or property. Its nature will not change in either case. That being so, the assessee in the present case having made a valid declaration on 5th September, 1963, that is, within 22 days of his becoming a partner in the firm in question, the income from the firm became the income of the HUF. It is also not disputed that the assessee duly accounted for the income of Rs. 41,341 for the assessment year 1965-66 and Rs. 9,780 for the assessment year 1966-67 in the returns filed on behalf of the HUF and the assessee did pay the income-tax on the said income in the hands of the HUF. For the reasons recorded above, the view taken by the Tribunal in accepting the appeal is unexceptionable. The question referred to us is, therefore, answered in the affirmative. There will be no order as to costs.
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1978 (10) TMI 30 - MADHYA PRADESH HIGH COURT
Gift Tax, Question Of Law, Reference To High Court ... ... ... ... ..... er does not expressly state that the assessee withdrew his claim for exemption under s. 5(1)(xii). All that is stated in express terms therein is that the assessee agreed to the valuation of the gift at Rs. 40,500. The Tribunal has also referred to a letter of the assessee which he wrote to the GTO on 19th of September, 1970. In that letter also there is no express statement by the assessee that in case the gift was valued at Rs. 40,500 he would not claim the exemption under s. 5(1)(xii). Having regard to the facts and circumstances of the case, we are of the opinion that the following question of law arises Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the assessee had given up his claim for exemption under section 5(1)(xii) of the Gift-tax Act, 1958, before the Gift-tax Officer ? We direct the Tribunal to state a case and refer the aforesaid question for the opinion of this court. There shall be no order as to costs.
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1978 (10) TMI 29 - MADHYA PRADESH HIGH COURT
Liberal Construction, Registered Firm, Set Off, Taxing Statute ... ... ... ... ..... pels us to reject the construction submitted by the assessee. The learned counsel for the assessee also submitted that the entire loss of Rs. 60,419 is not business loss and that it is partly depreciation loss. The statement of the case, however, proceeds upon the assumption that the whole of it is business loss. Indeed, the Tribunal in its order has made reference only to s. 75, and not to s. 32. Had it been argued before the Tribunal that part of this loss was depreciation loss, s. 32 would have been referred to in the arguments before the Tribunal. Be that as it may, the statement of the case and the question referred to us relate only to the application of s. 75. We are not entitled to travel beyond that and to go into the question whether depreciation loss can be carried forward by a registered firm. For the reasons given above, we answer the question in the affirmative, in favour of the department and against the assessee. There shall, however, be no order as to costs.
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1978 (10) TMI 28 - ALLAHABAD HIGH COURT
Business Expenditure, Income Tax, Retrenchment Compensation, Wholly And Exclusively ... ... ... ... ..... It does not arise in the carrying on of the business but on account of its transfer. During the entire period that the business was continued, there was no liability to pay retrenchment compensation. The liability which arose on transfer of the business was not of a revenue nature and hence was not deductible under s. 10. Further, since the liability under s. 25FF of the Industrial Disputes Act, 1947, was wholly contingent and did not raise any definite obligation during the whole of the period that the business was carried on, it could not fall within the expression expenditure laid out or expended wholly and exclusively for the purpose of the business. This authority is directly in point. A case of closure is identical to that of transfer of business. In view of this Supreme Court decision, we answer the question referred to us in the affirmative, in favour of the department and against the assessee. The Commissioner will be entitled to costs which are assessed at Rs. 200.
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1978 (10) TMI 27 - ALLAHABAD HIGH COURT
Income Tax Act, Partnership Firm ... ... ... ... ..... ed in the hands of the partner in his individual assessment. The difficulty that may be experienced by the partner who received the payment in relation to his own assessment cannot, in our opinion, confuse the clear language of s. 40(b). In our view, the interest paid by the firm to the partners either on the amounts brought by them from their respective HUF funds, or brought from their own individual funds is in either case payment of interest to the partners. Both these kinds of payments are within the purview of s. 40(b), and are inadmissible as a deduction in the assessment of the firm. The question of law referred for our opinion, namely Whether, on the facts and in the circumstances of the case, s. 40(b) of the I.T. Act, 1961, did not apply to the payment of interest to Sri C. L. Berry, I. L. Berry and P. K. Berry? Is answered in the negative, in favour of the department and against the assessee. The Commissioner would be entitled to costs which are assessed at Rs. 200.
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1978 (10) TMI 26 - ALLAHABAD HIGH COURT
Individual Partner, Undisclosed Sources ... ... ... ... ..... t case, the entries were alleged to have been made a week before the end of the accounting period. In the present case, the entries were made about three weeks prior to the end of the accepting period. Identical amounts were entered as deposited in the name of each partner. Different explanations were given by the assessee at different stages of the proceedings. They were disbelieved. In this view of the matter, the Tribunal was not justified in treating the amount as the income of the individual partner in view of the finding that the assessee had failed to establish that the partners have actually deposited the money and that the entries were not fictitious. Accordingly, we answer the question referred to us by holding that the cash credit entries standing in the names of the partners in the account books of the firm could validly be treated as the income of the firm from undisclosed sources. As no one appeared on behalf of the assessee, there will be no order as to costs.
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1978 (10) TMI 25 - ALLAHABAD HIGH COURT
Partner's Share In Income Of Firm ... ... ... ... ..... the hands of the partners. Thus, after allocation, the income relating to interest would be taxable under that appropriate head. Section 80L applies to income from interest on certain specified securities or investments. There is no dispute that if this section were applicable, the assessee was entitled to relief under cl. (vi) of sub-s. (1). Section 80L applies to an individual, a HUF or association of persons. It does not apply to a partnership-firm. The assessee was the individual partner. He was being assessed as an individual. He was hence entitled to the benefit of s. 80L, even though the firm may not be so entitled. Since the nature of the income does not change while being assessed in the hands of the partner, the partner as an individual is entitled to the benefit of s. 80L. We, therefore, answer, the question referred to us in the affirmative, in favour of the assessee and against the department. The assessee will be entitled to costs which are assessed at Rs. 200.
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1978 (10) TMI 24 - KARNATAKA HIGH COURT
Capital Redemption Reserve, Computation Of Capital For Surtax Purposes, Preference Shares ... ... ... ... ..... elating to Liabilities in the Form of Balance-sheet given in Part I of Sch. VI to the Companies Act, 1956, shall not be regarded as a reserve for the purposes of computation of the capital of a company under the provisions of that Schedule. It follows that other reserves under the heading Reserves and Surplus would have to be treated as reserves for the purpose of r. 1 of the Second Schedule to the Act. Such a reserve cannot be considered as a provision as contended by the department. The Tribunal was, therefore, right in including the sum of Rs. 1,50,000 and the sum of Rs. 6,00,000 in the capital base during the relevant assessment years for purposes of determining the quantum of statutory deduction to which the assessee was entitled during the respective years. In the result, we answer the question referred to us in each of the above cases in the affirmative and in favour of the assessee. The department shall pay the costs of the assessee. Advocate s fee, Rs. 250 (one set).
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1978 (10) TMI 23 - MADHYA PRADESH HIGH COURT
Banking Company, Provident Fund ... ... ... ... ..... e. The point that interest from investment of provident fund was not income of the assessee was not raised before the ITO or the AAC. The Tribunal held that as interest earned from investment of provident fund was included in the gross interest, it had to be held that the income was income of the assessee. The question referred to us does not cover the question whether interest from investment of provident fund is the assessee s income or not. We are, therefore, not entitled to go into this question. We have to proceed on the assumption that this income was income of the assessee. This income, however, cannot be a part of the income from banking business as the provident fund cannot be utilised in the business of banking. The income from interest of investment of provident fund also, therefore, does not qualify for exemption under s. 81(i)(a) of the Act. For the reasons given above, we answer the question referred to us in the affirmative. There shall be no order as to costs.
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1978 (10) TMI 22 - GUJARAT HIGH COURT
Annual Letting Value, Income From Property, Total Income ... ... ... ... ..... tion can be claimed under s. 22. We do not find any question of exemption being involved in this case before the Supreme Court in National Storage Pvt. Ltd. s case 1967 66 ITR 596. In any case, the question before us is, as tried to be urged on behalf of the revenue by the learned Government pleader, whether the occupation of the premises in respect of the income of which exemption is claimed should be the occupation as owner only or can be in any other capacity. The attempt of the learned Government pleader to impress upon us that it can be only in the capacity of owner and no other capacity cannot be accepted because, as stated above, it would amount to rewriting the section or, in any case, reading more than what is warranted. The result is that we must reject this reference of the Commissioner and we answer the question referred to us in the affirmative, in favour of the assessee and against the revenue. The Commissioner shall pay costs of this reference to the assessee.
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1978 (10) TMI 21 - PUNJAB AND HARYANA HIGH COURT
Development Rebate At Higher Rate ... ... ... ... ..... s well as from aluminium scrap . It is pertinent to note that in the letter of the Secretary, Bharat Chamber of Commerce, Calcutta, it has been pointed out that over 20 per cent. of such metals are made out of aluminium scrap just as a significant proportion of steel is made out of scraps. In view of the interpretation given by the Board regarding item (2) of the Fifth Schedule, we are left with no option, but to give the same interpretation as the Board itself gave to item (2) while interpreting item (1) of the Fifth Schedule. It would thus be seen that rebate at 35 per cent. will be available to the assessee, who manufactures, produces or constructs iron and steel (metal) either from the original ore or from the scraps. In view of the fact that the assessee is producing iron bars and girders from the scraps, he will be entitled to the rebate at 35 per cent. The question is thus answered in favour of the assessee. There will be no order as to costs. S. S. DEWAN J.--I agree.
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1978 (10) TMI 20 - MADHYA PRADESH HIGH COURT
Previous Year, Supplementary Statement ... ... ... ... ..... re, it could not be said to arise out of its order. In our opinion, the Tribunal is not correct on this point. The question whether s. 41(1) was applicable on the facts and in the circumstances of the case was admittedly raised before the Tribunal. The contention that the assessee wants to raise by pointing out that there was no identity of status of the assessee is only one aspect of the same question. Where the question itself is under issue, there is no further limitation imposed by s. 256(1) that the reference should be limited to those aspects of the question which had been argued before the Tribunal. It will be an over-refinement to hold that each aspect of a question is itself a distinct question. (See ClT v.lndian Molasses Co. P. Ltd. 1970 78 ITR 474 (SC)). In this view of the matter, we direct the Tribunal to submit a supplementary statement of the case and refer the question in the form in which it was formulated by the assessee. There shall be no order as to costs.
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1978 (10) TMI 19 - GUJARAT HIGH COURT
Penalty For Concealment ... ... ... ... ..... erred to this High Court for its opinion now no longer survives in view of the decision in S. P. Bhatt s case 1974 97 ITR 440 (Guj) and so also the controversy sought to be covered by those questions in view of the decision in S. P. Bhatt s case 1974 97 ITR 440 (Guj). Income-tax Application No. 97 of 1975 is, therefore, rejected. Rule in that matter is discharged. There will be no order as to costs of the Income-tax Application. Since the legal fiction arising from the Explanation to s. 271(1)(c) has been clearly explained by the decision of this court in CIT v. S. P. Bhatt, with which we are in complete agreement, the questions referred to us must be answered as follows Question No. 1 -In the affirmative as to both parts, that is, in favour of the assessee and against the revenue. Question No. 2 -Not necessary. Question No. 3 -In the affirmative, that is, in favour of the assessee and against the revenue. The Commissioner will pay the costs of this reference to the assessee.
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1978 (10) TMI 18 - JAMMU AND KASHMIR HIGH COURT
Income Tax Act, Jurisdiction Of High Court, Recovery Proceedings, Refund Of Tax, Treasury Officer, Writ Jurisdiction
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1978 (10) TMI 17 - PUNJAB AND HARYANA HIGH COURT
Firm Registration, In Part, Income Tax Act ... ... ... ... ..... ing that the correctness thereof had been put in jeopardy by the Supreme Court decision in Jer and Co. s case 1971 79 ITR 546 (SC). To the extent the Bench relied on ley and Co. s case 1971 79 ITR 546 (SC), it was right in that like in Jer and Co. s case the licence contained no conditions prohibiting the licensee from entering into partnership. There was no rule in the Punjab Fisheries Rules prohibiting the licensee from entering into partnership in regard to the fishing licences. But having held so it was unnecessary to examine the correctness of this court s aforesaid earlier decisions which were rendered in the light of the Opium Act and the Rules, the conditions and prohibitions contained wherein are identical with those contained in the Excise Act and the Rules thereunder. For the reasons stated, we answer the reference in the negative, i.e., against the assessee and in favour of the revenue. Since the assessee is not represented before us, we make no order as to costs.
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1978 (10) TMI 16 - MADHYA PRADESH HIGH COURT
Finding Of Fact, Income Tax Act, Question Of Law ... ... ... ... ..... urt observed that when the finding is one of fact, the fact that it is itself an inference from other basic facts will not alter its character as one of fact. In Rai Bahadur Mohan Singh Oberoi v. CIT 1973 88 ITR 53, the Supreme Court again observed that the finding recorded by the Tribunal on the point whether a purchase was made benami or not is one of fact and that such a finding based upon some evidence would have to be accepted by the High Court. Having regard to the facts and circumstances of the case, it cannot be said that the finding reached by the Tribunal in the instant case is such which no reasonable Tribunal would have reached or that the finding is perverse or is based on no evidence. In our opinion, as the finding reached by the Tribunal is a pure finding of fact based on evidence, no question of law arises and the Tribunal cannot be directed to state a case and refer that question. The applications are dismissed. There shall, however, be no order as to costs.
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1978 (10) TMI 15 - ALLAHABAD HIGH COURT
Income Tax Act ... ... ... ... ..... t for it in the year 1967-68. He thereupon suggested to the ITO to verify it in relation to earlier years. It is evident that the AAC had no factual information in relation to the year 1966-67. Because of the state of affairs in the assessee s books of account for the year 1968-69 his suspicions were aroused and he promptly conveyed his suspicion to the ITO. The ITO had no material in his possession. He acted on the suspicion conveyed to him by the AAC. It is apparent that the ITO based his belief only on suspicion. In view of the settled law, suspicion cannot constitute a valid ground for initiating proceedings under s. 147(b). The notice issued under s. 147(b) was hence without jurisdiction. Consequently, the entire proceedings as well as the order will fall as being bad for want of jurisdiction. We, therefore, answer both the questions referred to us in favour of the assessee and against the department. The assessee will be entitled to costs which are assessed at Rs. 200.
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1978 (10) TMI 14 - GUJARAT HIGH COURT
Income Tax Act, Minor Child, Total Income ... ... ... ... ..... arers, would be more in the nature of capital and, therefore, a corpus and it, therefore, loses its characteristic of being an income. In that view of the matter, therefore, cl. (v) of s. 64(1) is not attracted and cannot be applied in the facts and circumstances of the case. Our attention has been invited to a decision of a Division Bench of the Bombay High Court in Yogindraprasad N. Mafatlal v. CIT 1977 109 ITR 602, where the Division Bench has taken the same view on the matter that the meaning of the term deferred benefit cannot be so extended as to hold that the benefit which is available beyond the period of minority would also be a deferred benefit so as to attract the provision of cl. (v) of s. 64 of the I.T. Act. The result is that we reject this reference which is made at the instance of the Commissioner by answering the question in the affirmative, in favour of the assessee and against the revenue. The Commissioner shall pay costs of this reference to the assessee.
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1978 (10) TMI 13 - MADHYA PRADESH HIGH COURT
Finding Of Fact, Income Tax Act, Question Of Law ... ... ... ... ..... s of a house collectively, an organised family and whatever pertains to it as a whole persons who dwell together as a family also the place where one holds house, his home . It is further stated at the same place that the term has been held synonymous with family and also has been distinguished therefrom . As earlier pointed out by us, even if we assume that the word household should be given a wide meaning and that it should include not only the assessees alone but their father and the female members of the family of their father with whom they were living, the case of the assessees does not advance any further, the reason being that it was never contended before the Tribunal that the gold ornaments and jewellery were ever intended for the use of any female member of such a household. For the reasons given above, the question referred to us in all the cases is answered in the affirmative in favour of the revenue and against the assessees. There shall be no order as to costs.
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1978 (10) TMI 12 - MADHYA PRADESH HIGH COURT
Assessment Order, Assessment Proceedings, Penalty Proceedings ... ... ... ... ..... nt, or cancelling the assessment and directing a fresh assessment. Under this provision, jurisdiction is conferred on the Commissioner to call for and examine the record of any proceeding under this Act and on such examination if he finds that the order passed therein by the ITO is erroneous in so far as it is prejudicial to the interests of the revenue, he may revise the order after following the procedure prescribed under this provision. If, therefore, the ITO during the pendency of the proceedings has omitted to take notice of facts attracting s. 271(1)(a) of the Act during the. pendency of proceedings which ultimately ended in an order of assessment, the order would be erroneous and in this view of the matter, the Commissioner was right in exercising jurisdiction conferred on him under s. 263 of the Act. In this view of the matter, therefore, our answer to the question referred to us is in the negative. In the circumstances of the case parties shall bear their own costs.
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