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Income Tax - Case Laws
Showing 481 to 500 of 515 Records
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2013 (8) TMI 83 - MADRAS HIGH COURT
Business income or short term capital gain - Receipt from sale and purchase of shares and securities - Tribunal held that income as business income - Held that:- If the Tribunal decides that the findings of the Commissioner of Income Tax (Appeals) was without any material, nothing prevented the Tribunal from going into those facts and the findings to arrive at a finding based on the records - When the specific case of the assessee was that the income arising from the sale of shares could not be treated as income from business, in fairness to the claim of the assessee, the Tribunal ought to have considered the same in detail to arrive at a factual finding - recording of reasons is meant to serve the wider principles of justice and the quasi-judicial authority must record reasons in support of his conclusions and the decision of the Apex Court pointing out that insistence on reason is a requirement for both judicial accountability and transparency, it goes without saying that the order passed by the Tribunal on the mistaken impression that the assessee had not raised any dispute on the facts found by the Assessing Officer, calls for interference by this Court - Following decision of M/s.Kranti Associates Pvt. Ltd. and another V. Sh.Masood Ahmed Khan and others [2010 (9) TMI 886 - SUPREME COURT OF INDIA] - Decided in favour of assessee.
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2013 (8) TMI 82 - MADRAS HIGH COURT
Capital gain or business income - Ownership of property - Nature of income in the hands of land developer (vendor) - Tribunal held income as capital gain - Held that:- Original agreement between the assessee and the original owners makes no reference to the profession status of the assessee for taking the services of the assessee - when possession was given to the assessee enabling exercise of general control for discharging certain services, in consideration whereof the assessee was to be given 3 grounds of land coupled with the power given to the assessee to sell the 3 grounds, then the receipt would attract capital gains at his hands - Decided against Revenue.
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2013 (8) TMI 81 - GUJARAT HIGH COURT
Notice u/s 148 - Change of opinion - Held that:- When the earlier Assessing Officer had framed scrutiny assessment and examined certain deductions thoroughly, it was, thereafter, simply not open to the latter Assessing Officer to re-open the assessment on the basis that the earlier Assessing Officer committed a legal error. Once the claim was examined, scrutiny assessment was framed and Assessing Officer came to the conclusion with or without recording reasons in the assessment order, such an assessment could not have been subjected to the process of reopening - it is not a case where the Assessing Officer, while framing original scrutiny assessment, did not examine the petitioner's claim of deduction. He was acutely conscious of such a claim and was also of the opinion that the entire claim was not required to be granted. He called for explanation of the assessee and after taking into consideration the explanation, made disallowance to the extent he was convinced to do. If, in the process, he made a legal error, the succeeding Assessing Officer cannot correct such an error, through the process of re¬opening of the assessment - Following decision of Commissioner of Income Tax Vs. Kelvinator of India Ltd.[2010 (1) TMI 11 - SUPREME COURT OF INDIA] - Decided in favour of assessee.
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2013 (8) TMI 80 - GUJARAT HIGH COURT
Bogus purchases - Tribunal held that purchases are not bogus since there are entries in books of accounts for them - Held that:- Assessee had made payment through crossed cheques and assessing officer did not find that payment made came back to assessee. Assessing Officer has made addition in respect to the outstanding amount as on 31.3.2001 which has been cleared in the succeeding years. The ratio of the creditor to the purchases is normal considering the past records of the assessee - The issue is essentially based on facts - no question of law arises - Decided against revenue.
Disallowance of brokerage commission - CIT sustained addition - Tribunal deleted addition due to lack of evidence - Held that:- Assessee made payment of commission through account payee cheques for sales canvassed by the party and also in consideration of the collection recovered from purchaser. Payments cannot be unreasonable particularly when M/s. Shree Shantinath Silk Industries is not related to the assessee and so even disallowance made by CIT(A) is not proper - The issue is essentially based on facts - no question of law arises - Decided against revenue.
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2013 (8) TMI 79 - GUJARAT HIGH COURT
Addition u/s 68 - Credits received from donors - credit worthiness - Tribunal held that source of income of donors not disclosed therefore upheld addition - Held that:- assessee, when once discharges initial burden of proving the source, he is not required to prove the source of the source - The factor that the donors did not possess independent source to make such deposits must be viewed in light of the findings that the assessee had no justification for borrowing such amounts at such high rate of interest. These aspects would have a bearing on the genuineness of the transaction and the credit worthiness of the donors and cannot be seen as an attempt to throw the burden to prove source of the source on the assessee - substantial amount of cash was deposited in the bank accounts of all the creditors shortly prior to issuance of cheques and insufficiency of the fund with the creditors when could be duly established from the overall facts and circumstances of the case and when it is further found as a matter of fact that the assessee had no justification for borrowing such amounts at high rate of interest, even without disturbing the well established principle of not insisting on the assessee proving source of the source, on the robust facts of the revenue authorities have rightly not concluded in favour of the assessee - Decided against Assessee.
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2013 (8) TMI 78 - GUJARAT HIGH COURT
Deduction u/s 37(1) - Whether, payment of interest on delayed payment of instalments is penal in nature - Held that:- payment in question concerned interest for delayed payment of instalments. Though the agreement referred to as penal interest, the same was rightly not treated by the Tribunal as penalty. Merely because the agreement referred to such interest as a penal interest, any such payment would not partake the character of penalty. It is not even the case of the Revenue that the sum expended by the assessee was for payment of penalty. It was simplicitor liability of interest on delayed payment of installments - Decided against Revenue.
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2013 (8) TMI 77 - GUJARAT HIGH COURT
Notice u/s 148 - A.O. rejected assessee's objection to notice of reassessment - Held that:- impugned notice has been issued beyond a period of four years from the end of relevant assessment year - neither any order rejecting the petitioner's objection nor Revenue contends that the belief of the Assessing Officer that income chargeable to tax has escaped assessment, is based on any material outside of the record - full facts were there before the Assessing Officer in the form of declarations made in the returns filed as well as through correspondence during the course of scrutiny assessment. This therefore, is not a case where the assessee is stated to have failed to disclose truly and fully all material Acts necessary for assessment - Decided in favour of assessee.
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2013 (8) TMI 76 - ITAT DELHI
Assessment of income - whether CIT(A) erred in confirming the addition to the extent of Rs.2,70,000/- as income from other sources instead of exempt agricultural income - Held that:- Considering the material available on record claim of the assessee regarding cultivation of 180 bigha of land was accepted by the CIT(A) who has taken an amount of Rs.3500/- per bigha as net income from agricultural operations. He has taken Rs.6500/- to Rs.7000/- per bigha as gross amount of sugar cane value which on the basis of 50 qtl. yield per bigha gives a rate of Rs.130/- per qtl. of sugar cane which the AR has claimed and which the CIT(A) has also considered. CIT(A) only deducted the amount of agricultural expenses which he estimated at 50% of gross receipts which is justified. AR has not commented anything about expenses, he only insisted that that rate of sugar cane should have been taken @ Rs.130/- per qtl. which was taken by CIT(A) and after reducing expenses, he arrived at Rs.3500/- being net income per bigha. Therefore, no infirmity in the order of CIT(A) - appeal filed by the assessee dismissed
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2013 (8) TMI 75 - ITAT HYDERABAD
Transfer pricing adjustment - reference to TPO - whether there existed an AE relationship between the assessee and M/s O&S Metal Import GmBH - Held that:- The assessee has to establish that the assessee company has exported goods to other parties on similar prices and conditions & most importantly, evidences are to be brought on record by the assessee to show that the prices and other conditions were not influenced by M/s O&S Metal Import GMBH. That M/s O&S Metal Import GMBH had no share holding or control or management of assessee company in the impugned assessment year has to be verified by the AO. Hence, the issue to be remitted the file of AO to determine whether there existed an AE relationship between the assessee and M/s O&S. Metal Import GmBH. As held in Sanchez Capital Services vs. ITO (2012 (10) TMI 285 - ITAT MUMBAI) the mere filing of Form 3CEB by the assessee does not automatically imply that S.92A conditions were satisfied and there is an AE relationship. Rather, the specific facts and circumstances of the case have to be analyzed in order to conclude whether or not an AE relationship actually exists - in favour of revenue for statistical purposes.
Rejection of Most Appropriate Method (MAM) adopted by the assessee-company as Cost Plus Method (CPM) for determining the Arm's Length Price - Held that:- When the assessee has chosen a Most Appropriate Method (MAM) and substantiated the choice in its TP study, it is up to the TPO to record and substantiate the reasons as to why the assesse's MAM is incorrect and why some other TP method needs to be the Most Appropriate Method (MAM). In the instant case however no substance in any of the TPO's multiple arguments for rejection of assessee's internal CPM and adoption of external TNMM. Also as decided in DIT (Intl. Taxation) vs. Morgan Stanley (2007 (7) TMI 201 - SUPREME Court) "the most appropriate method has to be applied for computation of the arm's-length price. It will depend on facts and circumstances of each particular international transaction....". Applying this ratio internal CPM seems to be the Most Appropriate Method (MAM) rather than external TNMM. In favour of assessee.
Whether a sick company under BIFR would be erroneous to compare it cursorily using external TNMM - Held that:- Correct comparability analysis would be a non-trivial exercise and the entire TNMM application is bound to be sub-optimal. Given that internal CPM is available and easily applicable in the instant case, no merit in applying external TNMM in the instant case. In favour of assessee.
Adjustments during the computation of the arm's-length price - whether be restricted only to the international transactions and not to the entire turnover of the assessee? - Held that:- As decided in Lionbridge Technologies (P) Ltd. vs. DCIT [2012 (8) TMI 326 - ITAT, MUMBAI] assessee entered into international transactions with its AEs and also non-AEs and transfer pricing adjustment can be made only with reference to the international transactions with the AEs and not non-AEs. Thus AO is directed to restrict the adjustments, if any, only to international transactions. In favour of assessee.
No need for provision of +/- 5% range for CPM of the arm's-length price as there are no comparable prices in the instant case providing a set or range of multiple prices to be addressed by the +/-5% range. Against assessee.
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2013 (8) TMI 74 - ITAT HYDERABAD
Deduction u/s. 80IB(10) disallowed - contention of the assessee that the assessee commenced its business by 10.3.2006 and in order to claim deduction u/s. 80IB(10) the project was completed by 31.3.2011 relevant to the assessment year 2011-12 i.e. within 5 years from the end of the financial year and for which completion certificate was received on 20.9.2011. Further it was stated that though the assessee was following block-wise completion contract method of accounting.
Held that:- The meaning of "date of completion" as given in section 80IB(10)(a) (ii) would mean date on which completion certificate in respect of housing project was issued by the local authority. To grant deduction u/s. 80IB(10) it is mandatory to furnish the completion certificate of the housing project but stipulation for obtaining completion certificate should not be so interpreted to mean that an assessee can claim exemption u/s. 80IB(10) only in the year of completion of whole of the housing project, even where the project stretches over a number of years and assessee returns its income based on percentage completion method. It would only mean that the assessee has to obtain such certificate on completion of the housing project, least it would lose the deduction already granted u/s. 80IB(10) for the earlier years if it is not so produced.
As held in the case of Bajaj Tempo vs. CIT (1992 (4) TMI 4 - SUPREME Court) a provision in the taxing statutes granting incentives for promoting growth and development of the nation should be construed liberally. Further section 80IB(10)(a) only specified how to reckon the day of approval and date of completion. It would not mean that the assessee can have the benefit of section 80IB(10) only in the year of completion of the project, especially so, for an assessee not following project completion method for accounting its income. Of course if such period exceeded the prescribed limit, Revenue would be well within its rights to withdraw the claims already allowed, following the procedure prescribed under the Act. Thus, AO need not insist on the completion certificate in this assessment year, this is the right meaning of the statute. This view has also been taken by CBDT in its Instruction No. 4 of 2009 dt. 30.6.2009
As for the assessment year 2010-11, the assessee's claim u/s. 80IB(10) was granted on the basis of completion certificate issued by the GHMC, Circle-12, West Zone, Hyderabad vide letter dated 20.11.2011 showing that the project is completed within 5 years from the date of commencing of the project. When the Department accepted the same certificate in the A.Y. 2010-11, there is no reason to doubt the same certificate in the A.Y. 2009-10 to deny the deduction u/s. 80IB(10). See Kura Homes (P.) Ltd. Versus ITO [2012 (11) TMI 466 - ITAT HYDERABAD] - appeal of the assessee is allowed.
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2013 (8) TMI 73 - ITAT HYDERABAD
Jurisdiction power u/s 263 by CIT(A) - determination of the capital gain is not correctly made by the AO - Held that:- Since the issue of entire capital gain assessable in accordance with the development agreement was held by the Tribunal as assessable for the assessment year 1997- 98 and, therefore, no part of the capital gain is assessable for the assessment year under consideration. Hence, the CIT(A) should have decided the appeal on merits by considering the fact that the capital gain is not assessable for the assessment year 2002-03 when it was assessed for the assessment year 1997-98 and that the amount was actually determined for the assessment year 1997-98 which cannot be assessed again now. Therefore, set aside the order of the CIT(A) in all the appeals under consideration and allow the grounds raised by the assessees in their respective appeals.
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2013 (8) TMI 72 - ITAT AGRA
Penalty u/s 271(1)(c) - inaccurate particulars of income on account of liability in the name of sundry creditor M/s Shri Ram Udyog - Held that:- The assessee has filed copy of the account of M/s Shri Ram Udyog for the assessment year under appeal to show that there was opening credit balance of Rs.94,758.60 as on 01.04.2004. At the end of the year, on 31.03.2005 there is credit balance of Rs.1,20,850/-. The assessee has also filed copy of the balance sheet of the preceding assessment year as on 31.03.2004 in which the credit balance on 31.03.2004 in the name of M/s Shri Ram Udyog is mentioned as Rs.94,758.60. Thus, the aforesaid amount is coming up from the preceding assessment year and was shown as opening balance in the account of the assessee on 01.04.2004. Therefore, not a transaction related to the assessment year under appeal even if the addition is maintained on quantum as was not pressed before CIT(A).
Thus, the item which did not pertain to assessment year under appeal and was merely a opening balance in the assessment year under appeal which was coming up from the earlier year, cannot be considered for any purposes for fastening liability upon assessee. The books of account of assessee for preceding assessment year have not been doubted by the Revenue authorities. For opening balance no adverse view could be taken in the assessment year under appeal. The assessee has not failed to offer any explanation and the explanation of the assessee was not found to be false & has made bona-fide explanation based upon the entries in books of account maintained of the earlier years.
As decided in M/s Rajasthan Spinning Weaving Mills [2009 (5) TMI 15 - SUPREME COURT OF INDIA] "on every demand penalty is not automatic.". Also the case of CIT Vs The Shahabad Coop. Sugar Mills [2009 (10) TMI 154 - PUNJAB & HARYANA HIGH COURT] held that making a wrong claim is not at par with concealment or giving of inaccurate information, which may call for levy of penalty under section 271(1)(c). Also see CIT Vs. Reliance Petro Products Pvt. Ltd. (2010 (3) TMI 80 - SUPREME COURT) wherein held mere making of a claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the income of assessee. Thus penalty should not be imposed against the assessee. In favour of assessee.
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2013 (8) TMI 71 - ITAT MUMBAI
Validity of the levy of Fringe Benefit Tax (FBT) on the various fringe benefits deemed to have been allowed by the assessee - levy of tax vide order u/s. 115WE(3)- expenditure is on the maintenance of guest house - Held that:- It is only where and to the extent the guest house is used during the relevant year by the assessee's employees, that the impugned expenditure would stand to be covered u/s. 115WB(2)(K), and the said provision be said to be applicable. The total expenditure incurred during the year would therefore be required to be proportioned in the ratio of the user by the assessee's employees as against non-employees. The assessee succeeds partly, and the matter will travel to the AO to allow the assessee an opportunity to furnish the relevant details.
Expenditure on hotel during travel, and motor car expenses, which are claimed by the assessee to have been incurred for the purpose of its business, leading to no benefit to the concerned employees. As evident, the same stand covered by the various decisions Tata Motors Ltd. [2013 (5) TMI 372 - ITAT MUMBAI], Tata Asset Management [2012 (6) TMI 137 - ITAT MUMBAI], Toyota Kirloskar Motor Pvt. Ltd [2012 (6) TMI 484 - ITAT, Bangalore] therefore, the same are not liable for the charge of FBT.
Club expenses - Held that:- The assessee's only claim is that the club expenditure is incurred for the purpose of its business. The Revenue, however, does not dispute that, and neither is it the bone of contention between the two, so as to be relevant. What is relevant is whether the same nevertheless results in a provision of any benefit, direct or indirect, to the assessee's employees. The assessee being a company, the club expenses incurred would be so only for its employees and, therefore, in clear view fall to be covered u/s. 115WB(2)(N). The assessee's case, accordingly, is without merit - assessee's appeal is partly allowed.
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2013 (8) TMI 57 - ITAT DELHI
Assessment pursuant to DRP order - 43 issues.
Issues decided in favor of assessee:- Addition of freight inward/ import clearing expenses to cost of closing inventory - Addition on account of cost of rejection of semi finished goods and obsolete items - Addition of provision for increase in price of material to the value of closing inventory - Disallowance of cost of scrap material - Adjustment on account of provision for increase in price of material as prior period expenditure or preponement of revenue - Disallowance of alleged excessive purchases price paid to related parties as per AS-18 - Disallowance of purchase under section 40(a)(ia) for alleged failure to deduct TDS u/s 194C - Disallowance of advisory services availed from Hero Corporate Services Ltd. (HCSL) - Payment received on behalf of Hero Honda Fin lease Ltd. (HHFL) deemed as dividend u/s 2(22)(e) - Addition on account of difference in amount of excise duty in inter unit transfer price of goods - Addition to value of closing stock on the basis of value reported in cost audit report - Disallowance u/s 14A as per Rule 8D - Disallowance of Rs. 4.26 crores on account of payment to LIC to cover leave encashment on the ground that same is allowable on actual payment of leave encashment under section 43B(f) of the Act; - Disallowance of Rs. 2.08 crores being the actual amount of leave encashment to employees during the year, on account of no evidence establishing such payment. - Disallowance of expenditure incurred in connection with expansion of business at Hardwar - payment of passenger tax to Government on behalf of transporters - Reimbursement of free service coupons to dealer for repair of vehicle - Payment to dealers on account of reimbursement of advertisement expenses - Reimbursement of repair and maintenance cost of Omax Auto Ltd. - TDS on reimbursement of out of pocket/ traveling expenses to consultant/ vendors - TDS on rental of leased lines from MTNL/BSNL - TDS on rent paid towards property taken on lease (matter remanded back) - TDS on management fee under a portfolio management scheme - TDS on payments exceeding exemption limit specified under 197 certificate - TDS at lower rate or wrong provision - TDS on incentive/ discount to dealers - TDS on clearing charges paid towards import consignments (matter remanded back) - TDS on reimbursement of cost of gifts distributed to customers by FX Enterprise Solutions Pvt. Ltd. - Addition on account of non-recognition of royalty income during the relevant previous year - Addition on account of non-recognition of membership under the passport scheme - Disallowance of reimbursement of foreign traveling expenses to directors/ employees, on the ground of no evidence/ proof of actual expense incurred by employees. - Disallowance of advertisement expenses on the ground of being capital in nature - payment for advertisement and publicity of the brand name of the assessee and for promotion of its product during the Cricketing events of ICC versus royalty / fee for technical services - Disallowance of provisions for advertisement expenses under section 40(a)(ia) - Disallowance of provision for warranty - Disallowance of royalty/ technical guidance fee on the following grounds: a. capital expenditure; (b) applying section 40(a)(ia) for failure to deduct tax at source at rate applicable to business profits - Disallowance of export commission for alleged failure to deduct tax at source - Transfer pricing adjustments - Disallowance of alleged prior period expenses amounting to Rs. 489.07 lacs - Disallowance of excess provision for discounts/ incentives payable to dealers at the end of the relevant year, which was recovered in next year on receipt of actual bills from the dealers - Disallowance of payment made towards use of aircraft for alleged failure to deduct tax at source under section 194-I - Addition on account of outstanding liability DRP Directions - Gains from sale of investments income treated as business income - Disallowance of provision towards medical reimbursement/ leave travel allowance: (DRP Directions)
Issues decided against the assessee:- Disallowance of provision for price increase reversed in the next year - Disallowance of deduction u/s 80-IA in relation to generation of power - Disallowance of additional depreciation of computers installed at supervisory office - Disallowance of deduction u/s 35(1)(iv) in respect of R&D assets - Disallowance of first car insurance premium on the ground of capital in nature relating to acquisition of car - Disallowance of repair/ maintenance expenses of existing assets as capital expenditure - TDS on motorbikes gifted to various winners of contestants at TV shows - TDS on use of catering services provided by hotels and room rent to hotels - TDS on hire charges of generator used at the corporate office - TDS on purchase of flowers - TDS on stitching charges of uniform for employees - TDS on provisions of various miscellaneous expenses made at the end of relevant year - Disallowance of incorrect deduction on account of additional depreciation reversed in succeeding year.
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2013 (8) TMI 56 - ITAT DELHI
Gift u/s 56(2)(v) - Gifts/awards on winning of the Olympic Medal - Assessee claimed exemption under Circular No.447 of CBDT - CIT(A) upheld addition made by A.O. - Held that:- For applicability of Section 14 and thereafter Section 56, what is required is the receipt in the nature of income. In Circular No.447, it has been clearly stated "In view of this, it is clarified that such awards in the cases of a sportsman, who is not a professional, will not be liable to tax in his hands as it would not be in the nature of income." - Therefore, as per the Circular, the receipt by way of award by a sportsman who is not a professional sportsman will not be in the nature of income. - CIT(A) has distinguished between the words "reward" and "award", of course with reference to Section 10(17A). - Section 10(17A) is not applicable where the above Circular is applicable.
Shri Abhinav Bindra is the first person in the history of independent India to have won the Olympic Gold Medal. In a country whose population is more than 100 crores, if a sportsman who is not a professional sportsman has won the gold medal for the first time after 60 years of independence of the country and he has been given the awards/rewards/prizes mainly by various governments, local authorities, trusts and institutions and of course some corporate/individuals, a liberal construction of Circular No.447 is required. Considering the facts of the case and the nature and spirit of Circular No.447, we hold that in the case of the assessee, viz., Shri Abhinav Bindra, all the rewards/prizes/gifts received by him are covered by Circular No.447 dated 22nd January, 1986 and, therefore, should not be treated as income in his hands. - Decided in favour of assessee.
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2013 (8) TMI 47 - ALLAHABAD HIGH COURT
Stay of proceedings - various rounds of litigation - Search proceedings - Matter in appeal before apex court - Petitioner contends for stay of proceedings initiated from search and seizure due to order of this court - Held that:- The principle is well settled that the statement that a fact as to what transpired at the hearing recorded in the judgment of the Court, are conclusive of the fact so stated and no one can contradict the such statement by affidavit or other evidence - Filing of the present application is nothing but an abuse of the process of Court - Decided against assessee.
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2013 (8) TMI 46 - ALLAHABAD HIGH COURT
Deduction u/s 80M - CIT allowed partial deduction u/s 154 - Tribunal allowed full deduction to assessee - Held that:- Assessee has received dividend income from United Trust of India and made a claim - It was for the AO either to reject the entire claim or allowed the claim, but it was allowed partly. In the rectification application, the assessee has asked to restrict deduction as per law - When the claim is allowable then why it should not be allowed as per law. Genuineness of the claim is not doubtful. Therefore, the restricted claim under Section 80M of the Act is allowable - Decided against Revenue.
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2013 (8) TMI 45 - ALLAHABAD HIGH COURT
Exemption u/s 11 - Benefit u/s 13 - Tribunal allowed benefit - Held that:- there is no basis for assuming it for the reasons that the amounts passed on to other organizations were in nature of donations/grants to organizations carrying on charitable activities of which the members of the Governing Council of the Sansthan would not be beneficiaries. The establishment expenditure incurred at the Head Office was only a fraction of the total of such expenditure, a major portion of which had been incurred on the units carrying on charitable activities. The conclusion of the AO that the bulk of the expenditure was on non-charitable activities is, therefore, by no means sustainable - Following decision of CIT vs. Kamla Town Trust [2005 (8) TMI 90 - ALLAHABAD High Court] - Decided against Revenue.
It has not been mentioned that the funds were misappropriated and were not utilized for the purpose according to the objects of the society, so the registration cannot be cancelled - registration was not cancelled, but the benefit of exemption was not given by the AO, which is not allowable - Following decision of American Hotel and Lodging Association vs. CBDT [2008 (5) TMI 17 - SUPREME COURT OF INDIA] - Decided against Revenue.
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2013 (8) TMI 44 - ALLAHABAD HIGH COURT
Bad debts u/s 36 - A.O. held amount as capital investment - CIT upheld addition - Tribunal deleted addition - Held that:- assessee is engaged in the business of money lending. The income earned from the illegal business is also taxable income - There is a loss to the assessee as both the companies in which assessee made deposits have closed down their business and disappeared from town. Recovery of the amount in question is not possible. So, the assessee had written off the amount in the books of accounts as "bad debt" - to treat the debt as a bad debt had to be a commercial or business decision of the assessee based on the relevant material in the possession of the assessee. Once the assessee records the debt as a bad debt in his books of account that would prima facie establish that it was a bad debt unless the Assessing Officer for good reasons holds otherwise - Following decision of Director of Income Tax (International Taxation) vs. Oman International Bank [2009 (2) TMI 54 - BOMBAY HIGH COURT], CIT vs. Sri Ram Gupta [2005 (5) TMI 64 - ALLAHABAD High Court] and TRF Ltd. vs. CIT [2010 (2) TMI 211 - SUPREME COURT] - Decided against Revenue.
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2013 (8) TMI 43 - ALLAHABAD HIGH COURT
Interest u/s 40A(2) - Interest allowed in previous years - excessive interest - CIT disallowed interest - Tribunal deleted addition - Held that:- Principle of res-judicata or estoppal is not applicable in the income tax proceedings, as each assessment year is an independent assessment year. But fact remains that where a fundamental aspect permeating through the different assessment years has been found as a fact one way or the other and parties have allowed that position to be sustained by not challenging the order, it would not be at all appropriate to allow the position to be changed in a subsequent years - Following decision of Radha Swami Satsang v. CIT [1991 (11) TMI 2 - SUPREME Court] and CIT v. M/S. Walchand & Co. (Pvt.) Ltd. [1967 (3) TMI 2 - SUPREME Court] - Decided against Revenue.
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