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Case Laws
Showing 61 to 80 of 242 Records
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1980 (4) TMI 203 - ITAT MADRAS-B
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... ... ..... ointed out by the ld. counsel for the assessee, the jurisdiction for the application itself has not been established. The precise relationship of the partners of the two agencies with the Directors/shareholders etc. have not been defined. However, even assuming that there was jurisdiction, we are not in a position to say that 6 per cent commission is excessive or unreasonable. It is because the other agents are paid the same commission. M/s T.N.K. Govindarajalu Chetty was paid 7 1/2 per cent. As pointed out earlier, there were also obligations on the part of the two agents under the agreement, whereby they had to indemnify bad debts in notified cases, besides undertaking to secure orders for a minimum amount and bearing a part of laboratory expenses. The payment has to be counter-balanced with reference to these obligations. When this is done, there is no material for holding that the payment is, in any manner, excessive. 5. Under the circumstances, the appeals are dismissed.
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1980 (4) TMI 202 - ITAT MADRAS-B
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... ... ..... how that he was not conscious of the increase then his conduct in not filing the estimate cannot be considered to be contumacious. In the present case, it is seen that a firm which earned a larger income itself did not file an estimate and suffered the penalty. Though the assessee was a partner of the firm, the fact that the firm did not file an estimate also indicates that the assessee was not conscious of the liability to file the estimate under s. 212 (3a). Secondly, that the fault of the firm is coextensive with the default of the assessee partner to the extent of the income of that firm and when the firm had suffered penalty for that default it would be unjust to inflict a penalty to the same reason on the partner. Taking these facts into account, we are of the opinion that the assessee cannot be said to have failed to furnish the estimate required to be filed under s. 212 (3a) without reasonable cause. We, therefore, cancel the penalty imposed. 7. The appeal is allowed.
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1980 (4) TMI 201 - ITAT MADRAS-B
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... ... ..... ty was exigible in the facts and circumstances of the case. Time for payment was available upto 15th March, 1975 in respect of some other class of tax payers and even upto 31st March, 1975 for still another class. Under these circumstances, we are not in a position to say that the assessee s alleged belief is an after ndash thought. As long as there is no material to indicate that it is an after-thought, we are of the view that the ITO should have accepted the explanation because this is the first year of the imposition of the CD. The Act received the assent of the President on 1st Sept., 1974 and it provided for different time limits for making the CD for different persons. Ignorance of law may not be an excuse, but mere lack of knowledge about the exact date cannot justify penalty, when the payment has ultimately been made and the explanation is not found improbable. We accordingly delete the penalty. 3. In the result, the appeal is allowed. Penalty of Rs. 915 is cancelled.
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1980 (4) TMI 200 - ITAT MADRAS-B
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... ... ..... lls, it has been found that such loss is a normal business loss. The first appl. Authority has discussed the issue in great detail. On the facts found by him, the payment cannot be disallowed. The grounds of appeal assumed that it was in the nature of speculative transaction. Certain observations to the effect that the loss would have been greater if delivery had been taken in the order of the first appl. Authority had apparently given rise to this argument. The delivery was taken in pursuance of the contract, but the sugar cane was diverted to other mills. Hence, there is no scope for assuming that it is in the nature of a speculative transaction. Under the circumstances, no part of the amount representing the difference between the price payable to the cane growers under the contract and actual price recovered from the purchasing mills could be disallowed in assessee s hands. Hence, the deptl. appeal on this point also has to fail. 5. In the result, the appeal is dismissed.
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1980 (4) TMI 199 - ITAT MADRAS-B
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... ... ..... there was a decision in the case of Mohan Meakin Breweries (6) in favour of the assessee. But, it is seen that there is a contrary decision of the Bombay High Court in Century Spg. And Mfg. Co. Ltd. (7) which has distinguished the decision in 95 ITR 586. We find from the original assessment that there was no discussion at all about the fact that the paid up capital had been increased by issue of bonus shares in the middle of the year. We are, therefore, satisfied that there is no expression of any opinion on a question of law by the Audit party or a change of opinion on the part of the ITO which resulted in the reassessment with regard to this item. We are also of the opinion that the CIT (A) was right in following the decision of the Bombay High Court since it is the latest statement of law on the point distinguishing the earlier decision. We, therefore, uphold the order of the CIT (A) on this point also. 6. In the result, the appeals and the Cross Objections are dismissed.
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1980 (4) TMI 198 - ITAT MADRAS-B
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... ... ..... IT return. The property income declared by him in the IT return was subsequent to the ITO s assessment for the preceding year 1971-72, which the assessee decided to follow at the time of filing the return and hence it cannot be said that as on the date of filing the advance-tax estimate, he had deliberately understated his income. Regarding the salary income also, the assessee s explanation for the disparity appears to us acceptable. We are, hence of the view that the assessee had adequate reason for filing the advance-tax estimate in the manner that he did and it is not possible to attribute any mala fides to the assessee s conduct. The decision reported in 57 ITR 41, in which the High Court upheld a similar penalty under s.18A(2) of the IT Act, 1922 is distinguishable as in that case the assessee was not able to show that his estimate was justified by the statement of accounts as on the date of the estimate. In the above view of the matter, the assessee s appeal is allowed.
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1980 (4) TMI 197 - ITAT MADRAS-B
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... ... ..... intended to be denied to installations, fittings storage tanks, jetties, dry docks, tram ways, railway sidings pipelines, etc., which do not depreciate at a higher rate merely by additional use as is evident from readings of all the entries following the entry relating to electrical machinery under Item III (iv). Any attempt, therefore, on the part of the ITO to deny extra shift allowance on generator is not in keeping with the intent and purposes of depreciation and principles underlying the relief by way of extra shift allowance. In any view of the matter, we see no reason why the extra shift allowance should be refused on generator. We have taken the same view in ITA No. 2755/Mds/77-78 dt. 13th Nov., 1978 where one of us was a party. The order of the AAC has therefore to be confirmed though for different reasons. The revenue has not been able to persuade us to take a different view. We, therefore, confirm the order of the AAC in this case also. 2. The appeal is dismissed.
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1980 (4) TMI 196 - ITAT MADRAS-B
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... ... ..... nd avoided the payment of admitted tax inspite of the availability of resources, the exemption claimed was rightly rejected. 4. On a consideration of the rival submissions, we are of the opinion that the facts of the case do not conclusively show that the assessees had deliberately intended to avoid payment of admitted tax. On the other hand, the payment of very large sums of money both within the previous year and also after the filing of appeals show that the delay in payments was only due to financial difficulties as pleaded by the assessees and as found by the Tribunal in the case cited. We also find that the admitted tax had been paid before the file was taken up for hearing. We are therefore of the opinion that this is a fit case in which judicial discretion to exempt the assessee from the operation of the provision of s. 249(4) should be exercised in favour of the assessee. We therefore direct the CIT to entertain the appeals. 5. In the result, the appeals are allowed.
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1980 (4) TMI 195 - ITAT MADRAS-B
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... ... ..... sing stock and that there was only a mistake in the valuation thereof. The assessee has also explained how the mistake arose by pointing out that there was an inadvertent double deduction of the excise duty in finding out the value of the closing stock. We are satisfied that this was a bona fide error which the assessee discovered when the particulars of the closing stock were called for. Merely because the mistake was discovered only at that stage it does not cease to be a mistake and there is no material to indicate that there was any deliberate attempt to undervalue the closing stock. The fact that the assessee would have paid higher tax in the subsequent year if the mistake continued is also a contra indication. In the circumstances, there was no justification for imposing a penalty for a mere mistake in the computation of the closing stock which did not amount to deliberate concealment. We, accordingly, cancel the penalty imposed. 4. In the result, the appeal is allowed.
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1980 (4) TMI 194 - ITAT MADRAS-B
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... ... ..... hed and others in that appurtenant land. The drive way from the road to the building alone occupies 6750 sq. ft. The building itself covers a large area of 4500 sq.ft. Leaving out sit out, cow sheds, etc., the balance available is about 7 1/2 grounds. These lie in between sit outs, cow sheds, gardens etc. And could well be considered as part of the Court-yard. Considering that it is a very old building situated quite far away from the city by the then standards the extent of appurtenant lands are quite reasonable and convey the impression that these lands are part of a compact building and that the splitting up of the land and the building made by the ITO is quite artificial. The guidelines available from the Calcutta decision also confirms that in such a case the entire building along with the land should be treated as part of a dwelling house. Under the circumstances, we find no merit in this appeal and it is accordingly dismissed. 4. In the result, the appeal is dismissed.
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1980 (4) TMI 193 - ITAT MADRAS-B
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... ... ..... ointly and cultivated it. All that the section requires is that the assessee or the parent should have used the land for agricultural purposes and there is nothing in the section to import a further condition that they should have held the land in their own names independent of each other. Moreover, the ownership and possession held jointly can never detract from the assessee s right to own and possess it. Whatever possession he had and whatever agricultural use he made of it even prior to the partition was in his own right and not because of any sufferance by any other independent juristic entity having a superior right defeating his own. In the circumstances, on the admitted fact that the assessee and his parent were actually cultivating the lands for a period of two years prior to the transfer, we are satisfied that the relief under s. 54B was correctly granted by the AAC. We have, therefore, no hesitation in confirming his order. 5. In the result, the appeal is dismissed.
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1980 (4) TMI 192 - ITAT MADRAS-B
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... ... ..... ot the appellate order dispute the fact alleged by the assessee that the servants were engaged for the purpose of good maintenance of the premises. The decision relied upon by the first appellate authority relates to a case where the fact found was that the employee was free to employ servants or not. In fact, the payment was unconditional in that case and the Tribunal, therefore, treated the entire reimbursement as perquisite. It is not so in the assessee s case. In a co-employee s case this Tribunal, as mentioned in the preceding paragraph, held that the perquisite has to be evaluated only in terms of the circular which is specific to the extent that it has to be evaluated at Rs. 60 per month. Under these circumstances, the value of the perquisite as worked out by the assessee and offered for tax is correct and there is no case for any further addition. The assessee is, therefore, entitled to relief of Rs. 2,760. 5. In the result, the appeal is allowed. Relief due Rs. 2760.
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1980 (4) TMI 191 - ITAT MADRAS-B
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... ... ..... this matter also goes back to the ITO. The further question whether the provision for proposed dividend should be taken as a reserve or not was sought to be disputed by the parties, the learned Departmental Representative relying upon the decision of the Madras High Court in the case of Madras Auto Services and others vs. CIT (3). While the learned counsel relying upon a subsequent Full Bench decision in tax payer s favour in the case of Madras Motor and General Insurance Co. Ltd. vs. CIT (4). Since this matter is sent back to the ITO for finding out the validity of the appropriation, we have no doubt that the further question will also be decided by the ITO in accordance with law. 5. We are informed that the IT assessments of the assessee-company have not become final. That, however, need not deter us from disposing of these appeals, as changes consequential to variations in income are possible under the statute. 6. In the result, all the appeals will be treated as allowed.
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1980 (4) TMI 190 - ITAT MADRAS-B
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... ... ..... les and not the Board s circular, since Board s circular was not relied upon by the tax payers in those cases. We also find that the issue was decided in the same way in the assessee s own case by this Tribunal for asst. yr. 1971-72 in ITA No 2886 (Mds)/77-78 dt. 22nd Jan., 1979. We have therefore to confirm the finding of the first appellate authority even in this regard. 4. The last ground relates to the question of considering the charity collections to the extent of Rs. 5,967 in the hands of the assessee. This Tribunal found that such collections are not taxable in an earlier year in the same assessee rsquo s case for asst. yr. 1973-74 in ITA No. 1483 of 1976-77 dt. 6th Oct., 1979. The Supreme Court in the case of CIT vs. Bijli Cotton Mills (P) Ltd (5) decided that such receipts could not be treated as part of trading receipts. Hence, the order of the first appellate authority even on this ground has to be sustained. 5. In the result, the Departmental appeal is dismissed.
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1980 (4) TMI 169 - ITAT MADRAS
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... ... ..... g. As urged by the departmental representative the office expenses also cannot be allowed as a normal expenditure against interest income. At the same time, it cannot be denied that some expenditure is involved in collection of the interest and managing the bank accounts which will be directly expenditure wholly and exclusively for the purposes of earning such income, notwithstanding the fact that such expenditure is not readily ascertainable. It is for this reason that 10 per cent of the income was claimed as an expenditure by the assessee-company itself. We find no reason why we should adopt a different yardstick for measuring the expenditure. It is inconceivable that there was this income without any expenditure. Under the circumstances, 10 per cent of the receipts taken will have to be allowed as expenditure for both the years. To this extent the amount to be capitalised will be reduced. 7. In the result, both the appeals are allowed in part, on the lines indicated above.
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1980 (4) TMI 167 - ITAT JAIPUR
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... ... ..... record of the Commercial Tax Authorities, but it is no where pointed out as to which material is there that may lead to the conclusion that the assessee in reality effected the sales outside the books to the tune of Rs. 66,000. Shri Pandey is correct in arguing that the penalty proceedings are absolutely different and independent from the assessment proceedings. No doubt, the ITO may rely on the assessment record or the record of the Commercial Tax Authorities to hold that there was concealment, but there must be some positive evidence that may point out that the sales to the tune of Rs. 66,000 were being effected by the assessee outside the books and that on those sales, the profits of Rs. 5,280 were being earned. There being no such evidence on record, we hold that it is not a better case than the one in which the income is estimated by applying a gross profit rate where on penalty can be levied. For the reasons, we cancel the penalty of Rs. 5,280. 3. The appeal is allowed.
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1980 (4) TMI 166 - ITAT JAIPUR
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... ... ..... of the partners in three firms. He could not receive his share income from those firms. At the relevant time the health of the assessee was also not good. The assessee gave the return duly filled in to his counsel but on account of inadvertence of the counsel the return could not be filed within time. The returned income was practically accepted by the Department. No notice under s. 139(2) was served by the Department. From the aforesaid facts it is clear that the explanation given by the assessee is quite reasonable and probable. The explanation so given was never found to be false. After rejecting the explanation of the assessee, on behalf of the Revenue, no positive material was placed on record to show that the assessee in conscious disregard of his obligation failed to file the return within time. So, there is no justification for imposing penalty under s. 271(1)(a) of the Act. Accordingly, the impugned penalty order is cancelled. 7. In the result the appeal is allowed.
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1980 (4) TMI 165 - ITAT JAIPUR
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... ... ..... The purchaser of the plot is not free to construct a modern multi-storey building of his own choice and as such the value of the built-up area is to be taken much lower than the value of open un-built-up area. Keeping the above into consideration, the value of land has been taken for valuation at Rs. 40 per sq. yd. which gives the value of land of Rs. 73,333 . It thus appears to us that even on cost production basis the valuation done by the registered valuer is more acceptable than the valuation done by the Valuation Cell which is highly excessive. Compared to the valuation according to both the methods done by registered valuer, M/s K.N. Bhargava and Co. the amount of sale i.e. Rs. 1,65,000 does appear to represent the proper market value and, therefore, there was no justification for the initiation of the acquisition proceedings and for passing the order of acquisition and hence we cancel the order of the learned competent authority. 19. In the result, the appeals succeed.
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1980 (4) TMI 164 - ITAT JAIPUR
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... ... ..... el that the AAC was justified in cancelling the penalty. It is true that the filing of the wealth-tax return was delayed by 2 months but before levying the penalty it was necessary to establish that the failure was without reasonable cause. On the facts stated above, about which there is no controversy, it cannot be said that there was no reasonable cause in this case. The assessee had applied for extension of time twice. Before the AAC evidence was produced for filing the same. The assessee was also handicapped by non-receipt of her capital account from the firm in which she was a partner and also by non-receipt of the balance-sheets of the companies of which she was the share holder. These were required for determining the market value of the shares as per rr. 1C and 1D of the WT Rules. The failure of the assessee was clearly for reasonable cause and there was no justification for the levy of the penalty. We uphold the order of the AAC. 4. In the result the appeal succeeds.
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1980 (4) TMI 163 - ITAT JAIPUR
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... ... ..... ssee is Rs. 1,000 is quite reasonable. 3. The other contention of the assessee is that the AAC was wrong in estimating the house hold expenses at Rs. 6,000. In the immediately preceding year the household expenses disclosed was Rs. 2,137. The same was accepted by the Deptt. As a matter of fact, the entire household expenses of the family were Rs.18,866. In this year no cogent material was brought on record that the household expenses were to the extent of Rs. 6,000. The ld. Deptl. Rep. supported the order of the AAC. 4. In our opinion, the finding of the AAC is not correct. In the immediately preceding assessment year the assessee disclosed Rs. 2,147. The same was accepted by the Deptt. He was unmarried and he was living at Ajmer. The household expenses of the family were Rs. 18,866. Looking to the aforesaid fact and the past history the household expenses shown by the assessee were quite reasonable. Accordingly the addition is deleted. 5. In the result the appeal is allowed.
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