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Showing 81 to 100 of 213 Records
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1982 (7) TMI 134 - ITAT CALCUTTA-B
Business Expenditure ... ... ... ... ..... re open before the management, either not to yield to the demand of the labour and allow the income-earning asset to die temporarily and thereby reduce not only the income but the revenue to the Government. The other course was to the pay something more, get the labour satisfied and have peaceful work and thereby maintain the income-earning apparatus so that not only the income of the assessee goes up but the Government also gets its due share. Between the two options definitely the second option is in the interest of the assessee. The second stop would not only be logical, but commercial expediency would justify it. Therefore, the additional payment made by the assessee which has been paid not only during the year of appeal but in preceding and still preceding years and which had taken the character of a customary payment necessarily will have to be allowed as business expenditure, if not under section 36(1)(ii) but under section 37. 12. In the result, the appeal is allowed.
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1982 (7) TMI 133 - ITAT CALCUTTA-A
Shipping Company ... ... ... ... ..... has been filed before us, and which we have admitted in evidence, reads as follows According to Current Swedish Company Act a company is required to allocate from its profit to a Debt Adjustment Fund 10 per cent of the profit for each year. . . The Debt Adjustment Fund is, therefore, not a fund or allocation which is meant for meeting any specific liability like taxation or to safeguard against the loss which may arise on account of bad and doubtful debts. It is created under a statute and it, therefore, in our opinion, constitutes reserve and as such it will have to be treated as part of capital in accordance with rule 1 of the Second Schedule. While taking the above view, we are supported by the ratio of the following decisions of the Supreme Court First National City Bank v. CIT 1961 42 ITR 17 and Vazir Sultan Tobacco Co. Ltd. v. CIT 1981 132 ITR 559. The stand of the department being contrary to it, is not acceptable to us. Accordingly, we reject the departmental appeal.
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1982 (7) TMI 132 - ITAT BOMBAY-E
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... ... ..... accept this appeal. It has been held by the Calcutta High Court in CIT vs. Roop Traders (1979) 118 ITR 421 (Cal) that under s. 246 of the IT Act, 1961 r/w r. 45 of the IT Rules, 1962 and Form No. 35 prescribed under the Rules, where an assessee challenges before the AAC both the assessment under s. 143 and the order refusing registration under s. 185, a single consolidated appeal against the order of the assessment as well as the order refusing registration or renewal of registration is valid. This authority has also distinguished the earlier decision of the Calcutta High Court in (1965) 58 ITR 130 (Cal) referred to above. I would therefore, follow the aforesaid authority, i.e. (1979) 118 ITR 412 (Cal) and hold that the AAC was not justified in dismissing the consolidated appeal of the assessee as incompetent. The impugned order is, accordingly, set aside and the case is restored to the file of the AAC for deciding the same on merits. 4. In the result, the appeal is allowed.
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1982 (7) TMI 131 - ITAT BOMBAY-E
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... ... ..... atal to the assessee s claim. The recovery is only in respect of items of expenses incurred and may not even come strictly under the head bad debt . It has been incurred in the course of the business and on the facts it is clear that the assessee could not have avoided them. There is no justification for disallowing this amount. The addition is deleted. 3. Out of overall claim of expenses of Rs. 26,363 the ITO disallowed Rs. 4,500 and the CIT(A) Rs. 3,500. The turnover of the assessee is in the neighbourhood of nearly Rs. 8 crores. From the very nature of things, it is not possible to support with proof every item of miscellaneous expenditure incurred. In matters like this an idea of the overall expenditure incurred alone would be a proper guide as to the admissibility of the expenditure. Looking to the extent of the turnover, etc., I see no reason to disallow any part of the expenditure under this head claimed. The addition of Rs. 3,500 is deleted. 4. The appeal is allowed.
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1982 (7) TMI 130 - ITAT BOMBAY-E
Fees For Technical Services, Indian Company, Tax At Source ... ... ... ... ..... ta had relied on the proviso found therein. But that proviso will exempt only lump sum payments. On facts, since we are not concerned with lump sum payments, the proviso will not save the assessee. So, on this consideration also, we find that the receipts are taxable. This will dispose of issue Nos. (2) and (3). This will also dispose of the arguments raised by Shri Mehta that the proviso to clause (vii) would apply. Since clause (vii) itself will not apply, there is no question of going into the proviso of that clause. 16. We come to the last issue, i.e., the expenses to be allowed. On this no argument had been raised before us. We find that the Commissioner (Appeals) had gone into the issue and he had fixed 20 per cent as reasonable. It has not been shown that this is not correct. We will, therefore, hold that the deduction of 20 per cent as fixed by the Commissioner (Appeals) for expenditure should be allowed. 17. In the result, the assessee s appeal would stand dismissed.
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1982 (7) TMI 129 - ITAT BOMBAY-D
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... ... ..... ITR 591 (Cal) (CIT vs. Sheonath Singh) that the absence of or defect in the signature of the appellant in the name of appeal is not an illegality or fatal but only an irregularity which can be rectified by an amendment, the amendment taking effect from the date when the document had originally been filed. To the same effect is the view of the IT Appellate Tribunal in the case of Mr. I.S., Bombay vs. ITO (ITA Nos. 2332 and 2333 (Bom)/1977-78). In view of these authorities, I hold that the failure of the assessee to sign the memorandum of appeals in person was only a curable irregularity and did not invalidate the appeals ab initio. I, therefore, conclude that the AAC was not justified in dismissing the appeals before him as invalid. The impugned orders are, accordingly, set aside and the cases are restored to the file of the AAC for deciding the case on merits after allowing the assessee to rectify the memoranda of appeals, 5. For statistical purpose, the appeals are allowed.
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1982 (7) TMI 128 - ITAT BOMBAY-D
Capital Gains Tax, Chargeable To Tax ... ... ... ... ..... ally to work out the amount of capital gains. In the case of Nirbheram, the Madhya Pradesh High Court has considered the scope of the Explanation to section 251 of the Income-tax Act, 1961 which was not present in section 31(3) of the Indian Income-tax Act, 1922, considered by the Supreme Court in the cases cited earlier. It was held that the words any matter arising out of the proceedings occurring in the Explanation are not wide enough to include a matter which could have been raised before or considered by the ITO, but was not raised before him or considered by him, and, that the said words can refer only to a matter which was processed by the ITO or was raised before him for being processed. In the present case, as already pointed out, the ITO had not processed the matter at all. We, therefore, hold that the AAC could not have, by way of enhancement, brought to tax the sum of Rs. 15,000 and that the enhancement cannot be sustained. 6. In the result, the appeal is allowed.
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1982 (7) TMI 127 - ITAT BOMBAY-D
Bonus Shares, Expenditure Incurred, Revenue Expenditure ... ... ... ... ..... it is incurred to obtain an enduring benefit, and that too, in the capital field. Applying the said test to the facts of this case, we find that the assessee must fail. The assessee had to issue bonus shares in order to improve the ratio between its capital and reserves, vis-a-vis its liabilities to third parties. In our opinion, this is an enduring benefit, because the benefit arising out of this improved picture of its capital structure, would be available to it for many future years. Again, the enduring benefit thus obtained, was obviously in the capital field. Hence, respectfully following the decision in the case of Empire Jute, we hold that the expenditure under consideration, incurred by the assessee, was done with a view to obtain an enduring benefit in the capital field and so, they have been rightly disallowed by the revenue authorities as capital expenditure. We, therefore, uphold this disallowance and reject this ground. 7. In the result, the appeal is dismissed.
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1982 (7) TMI 126 - ITAT BOMBAY-C
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... ... ..... pay damages for non-payment of the contributions to the provident fund in time. These damages included both interest and penalty. The authority had the power either to impose or not to impose interest by way of damages and it was a matter within the discretion of the competent authority. It, therefore, stands on a different footing from the interest which automatically accrues due under an enactment. The ruling of the Allahabad High Court in the case of Saraya Sugar Mills P. Ltd. vs. CIT 1978 CTR (All) 329 (1979) 116 ITR 387 (All) referred to above with regard to the damages ordered to be recovered under s. 14B of the Provident Fund Act still holds good. As already stated, no ruling to the contrary was brought to our notice. Respectfully following the ruling of the Allahabad High Court referred to above, we hold that the interest amounts is not an admissible deduction and the ground is, therefore, decided in favour of the Department. 6. In the result, the appeal is allowed.
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1982 (7) TMI 125 - ITAT BOMBAY-C
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... ... ..... . 25(2) on 30th Dec., 1980 or pass an order under s. 25(2) on 15th Jan., 1981. To our mind, neither the AAC s order dt. 17th Jan., 1982 nor the Commr s order dt. 13th Feb., 1981 rendered the WTO s orders dt. 2nd Jan., 1980 non est abinito. The orders under s. 35 held the field till vacated by any competent authority. It is doubtful whether the AAC s or the Commr. s orders vacated them from the dates on which these authorities passed their respective orders. About one thing however, we are certain and that is that on 30th Dec., 1980, the WTO s order under s. 35 held the field. With these orders in existence the Commr. culd not have issued the notice under s. 25(2) dt. 30th Dec., 1980 and the consequent orders dt. 15th Jan., 1981 and 13th Feb., 1981. Thus, according to us, even the subsequent developments do not support the validity of the order under appeal. The Commr. s order, therefore, requires to be vacated and is hereby vacated. 9. In the result, the appeals are allowed.
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1982 (7) TMI 124 - ITAT BOMBAY-C
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... ... ..... yolefins Industries Limited. In that case the Tribunal had held that the expenditure incurred on the repairs and maintenance of the company leased flats occupied by the directors of the company could not be treated as a perquisite u/s 40(c) of the IT Act, 1961. Following the same, he directed the ITO to recompute the amount disallowable u/s 40(c) in the light of the aforesaid decision. Shri S..S Medh urged before us that the CIT (Appeals) erred in his decision while Shri B.N. Pardiwalla supported the decision of the CIT (Appeals). We have considered the contentions of both the parties as well as the facts on record. We have gone through the decisions of the Tribunal on which the CIT (Appeals) has relied. We are in respectful agreement with the conclusions arrived at by the Tribunal in aforesaid orders. Hence, we uphold the decision of the CIT (Appeals) on both these points. 11. In the result, the assessee s appeal is partly allowed while the departmental appeal is dismissed.
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1982 (7) TMI 123 - ITAT BOMBAY-C
Business Income ... ... ... ... ..... stion of profit arising... After referring to the aforesaid quotation, the learned judges have observed that normally it is well settled that where subsidies or grants are given by the Government to assist a trader in his business they are, generally speaking, payments of a revenue nature. They are supplementary trade receipts and not capital payments, although they might be called advances or might be subject to contingency of repayment. In fact, the Bombay High Court decision referred to above has been followed in some of the other cases referred to above. Following the Bombay High Court decision in the case of Dhrangadhra Chemical, we shall hold that the sale proceeds of the import entitlements earned by the assessee were business income earned by the assessee and were accordingly liable to tax. Therefore, the order of the Commissioner (Appeals), on this issue requires to be reversed and is accordingly reversed. 5. In the result, the appeal filed by the revenue is allowed.
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1982 (7) TMI 122 - ITAT BOMBAY-C
Revenue Expenditure ... ... ... ... ..... to the business carried on by the assessee. Secondly, it is equally evident, that the advantage was in the capital field, because it relates to the capital structure of the assessee. It is not a case of obtaining loan or issuing debenture. Hence, we find support for our conclusion from the decision of the Supreme Court in the case of India Cements, especially the observations appearing at page 61, namely, obtaining capital by issue of shares is different from obtaining loan by debentures. Both of us have considered this point recently in another case and have arrived at the same conclusion in our order dated 3-7-1982 in the case of the Indian Card Clothing Co. Ltd. IT Appeal No. 1392 (Bom.) of 1981 . In view of the above reasons, we uphold the disallowance under consideration and reject this ground. 7 to 1 0. Paras 7 to 10 are not reported here as they involve minor issues. 11. In the result, the assessee s appeal is partly allowed while the departmental appeal is dismissed.
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1982 (7) TMI 121 - ITAT BOMBAY-B
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... ... ..... not overlook the most important thing that out of a whim or fancy the Cantonment would not dispossess him of the property even though the terms of the grant permit immediate resumption. The assessee s claim, therefore, that this property is not an asset at all and that its value should be depressed substantially, the land having no value, cannot be accepted. A property having the extent of area which the assessee s property has and the other surrounding circumstances would certainly fetch, if sold, the price fixed by the CWT(A). The CWT(A) has given a reduction even for the joint ownership of the properties. Though the circumstances related to the ownership of flats in Bombay may not be applicable with that much force to Poona, joint holding of the properties do not loose their value even in this place to an extent beyond that fixed by the CWT(A). As regards the value of this property, we decline to interfere with the CWT(A) s computation. 13. The appeals are partly allowed.
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1982 (7) TMI 120 - ITAT BOMBAY-B
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... ... ..... if enhancement is to be made, the Tribunal must give an opportunity to the assessee to present his case before passing orders. Since we are not sure that there will be a real enhancement in this case after the WTO has gone into the details the stage for giving an enhancement notice if any has not therefore arrived. If the WTO finds that the value he has to adopt is in excess of the original figure of assessment he must issue a proper notice to the assessee inviting his attention to the enhancement hear his representations and then complete the assessment. The principle natural justice, which requires a hearing before the enhancement would idn our opinion be satisfied if the assessee has a hearing on this point even at an earlier stage where he question of increase comes up If, however the assessee wants a hearing by us he may approach us in what way will be a mere continuation of these proceedings and not a separate appeal. 8. For statistical purposes the appeal, is allowed.
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1982 (7) TMI 119 - ITAT BOMBAY-B
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... ... ..... application for extension of time, it is to be presumed that the time, as prayed for, has been granted. If that be so, then the return evidently filed on 8th Nov, 1974 was within time, and the loss determined on the basis of that return, has to be carried forward in accordance with the law for being set off against the profits of the future years. The assessee succeeds on this ground alone. We also find force in the other argument of the assessee that even if the return is taken to have been filed on 26th Mar, 1976, it was a return u/s 139(4) and so any loss determined on the basis of that return also qualifies for being carried forward to be set off against the future profits, in view of the clear decision of the Bombay High Court, on this point, in the case of Telster Advertising. For the above reasons, we delete the direction of the ITO not to carry forward the loss from his order dated 12th Mar, 1980 passed u/s 155(1) of the Act. 8. In the result, the appeal is allowed.
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1982 (7) TMI 118 - ITAT BOMBAY-B
Break Up Method, Investment Company, Market Value, True Nature ... ... ... ... ..... ent is to be made, the Tribunal must give an opportunity to the assessee to present his case before passing orders. Since we are not sure that there will be a real enhancement in this case after the WTO has gone into the details. The stage for giving an enhancement notice, if any, has not, therefore, arrived. If the WTO finds that the value he has to adopt is in excess of the original figure of assessment, he must issue a proper notice to the assessee inviting his attention to the enhancement, hear his representations and then complete the assessment. The principle of natural justice, which requires a hearing before the enhancement would, in our opinion, be satisfied if the assessee has a bearing on this point even at an earlier stage where the question of increase comes up. If, however, the assessee wants a hearing by us, he may approach us in what will be a mere continuation of these proceedings and not a separate hearing. 8. For statistical purposes, the appeal is allowed.
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1982 (7) TMI 116 - ITAT BOMBAY-A
Appeal To AAC, Limitation, Long-term Capital Gains ... ... ... ... ..... from year to year. In fact there was no material for the Commissioner (Appeals) to come to the conclusion that the criteria laid down in the Bombay High Court decision were satisfied in the present case. The Commissioner (Appeals) has not admitted any fresh evidence in this regard. The reference of the learned counsel for the department to rule 46A may not, therefore, be relevant, but we have certainly to hold that the Commissioner (Appeals) had no materials to hold that the lands in the present case satisfied the conditions referred to in the Bombay High Court decision. 23. We, therefore, hold that the Commissioner (Appeals) erred in condoning the delay in the present case and admitting the appeal and also deciding it on merits in the assessee s favour. His order is cancelled. 24. In view of our finding it is not necessary to go into the question of applicability, on merits of the Bombay High Court decision itself, in the present case. 25. The departmental appeal is allowed.
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1982 (7) TMI 115 - ITAT BOMBAY-A
Computation Of, Chargeable Profits ... ... ... ... ..... making assessments under the provisions of the Surtax Act. Further, section 80AA does not define the expression income by way of dividends , but only specifies the method of computing the deduction allowable under section 80M. As such, section 80AA cannot be construed as a definition clause falling within the meaning of section 2(9) of the Surtax Act. We are, therefore, unable to accept the contention of the revenue that only the net dividend income is to be excluded under rule 1(viii) of the First Schedule for the purposes of computing the chargeable profits of the assessee-company. Accordingly, we accept the contentions of the learned counsel for the assessee and direct the STO to deduct the gross amount of dividends of Rs. 3,69,620 in the assessment year 1976-77 and Rs. 4,62,025 in the assessment year 1977-78 in computing the appellant s chargeable profits under rule 1(viii) of the First Schedule. 10 to 12. These paras are not reproduced here as they involve minor issues.
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1982 (7) TMI 114 - ITAT BOMBAY-A
Gift Tax, House Property, Income Tax Proceedings ... ... ... ... ..... and section 149 of the 1961 Act for coming to the conclusion that for the purpose of the 1961 Act, issuance is relevant rather than service. Their Lordships observed . . . The departure from the old provision in section 34 of the 1922 Act is a conscious departure and it is our duty to give full effect to it . . . . The decision cited by the department in effect thus supports the assessee s case, section 8 of the Act being similar to section 34 of the 1922 Act, rather than section 149 of the 1961 Act. Under the Act, therefore, the limitation is to be spelt out from service of the notice rather than issuance of the same. Though the notice has been issued in this case on 30-3-1974, it was served only after the due date, viz., 31-3-1974. The notice, therefore, must be held to have been not validly served and the reassessment made on the basis of such a notice should be cancelled. 7. In view of our above finding, the other points raised are not gone into. 8. The appeal is allowed.
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