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Income Tax - Case Laws
Showing 1 to 20 of 77 Records
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1979 (12) TMI 155
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... ... ..... cial Deputy Collector as the proper valuation, he must be deemed to have adopted that valuation as his own estimated value of the lands which he wanted to enhance by relying upon the valuation made by another authority, namely, the City Civil Court. To such a case s. 59 is clearly attracted but, obviously, with a view to avoid the bar of s. 73A, he purported to issue the impugned notice under s. 61 and, therefore, the same is liable to be quashed. The aforesaid decision seems to lend support to the second ground urged by counsel for the appellant for quashing the impugned notice but we would like to, base our decision on the first ground discussed above. In this case also, we are told that the rectification proceedings have been completed pursuant to the impugned notice, which also must be quashed. In the result, the notice under s. 61 of the Act and the rectification order passed in pursuance thereof or quashed. The revenue will pay the costs of the appeal to the appellant.
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1979 (12) TMI 108
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... ... ..... other words when the property is in occupation of the owner since last several years and there is no material on record to indicate that the property had undergone substantial change by addition and alteration or substantial repairs, the annual letting value should ordinarily be determined with reference to the first year of the occupation by the owner of the property, that is to say that the reasonable routine on the property in the year in which the property was constructed as well as the rent then prevailing in the locality . 6. Accordingly, on the facts and in the circumstances of the assessee s case in appeal before us, we feel inclined to set aside the orders of the lower authorities on the count of taking the S.O. property at Rs. 5,400 and taking the net income at Rs. 3,000 and further direct that the S.O. property income as has since been returned by the assessee shall be substituted in place thereof, with the result te appeal of the assessee succeeds and is allowed.
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1979 (12) TMI 107
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... ... ..... ITO has made penalty order without applying his judicious mind. In view of our discussion as above, and applying the ratio of the decisions of the Hon rsquo ble Supreme Court in the cases of Hindustan Steel Ltd. and Khoday Eswaras and Sons, we are of the opinion and do hold that the facts of the case in appeal before us did not warrant imposition of penalty under s. 221 (2) of the Act inasmuch as, the Hon rsquo ble SUPREME Court has since held that the penalty proceedings were quasi judicial and penal in character and no material has been brought on record to show contumacious conduct and mind of the assessee to warrant and justify imposition of penalty. 9. More so, the amount of tax payable stands paid, having been paid by the assessee on his own, the revenue has not suffered any loss. We uphold the impugned order of the AAC which is based on correct appreciation of the facts and circumstances of the case. 10. In the result, the appeal by the revenue fails and is dismissed.
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1979 (12) TMI 102
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... ... ..... t of which interest claim was made. But the assessee s contention that the entire borrowings have been utilised for the purpose of business had not been adequately scrutinised. Some items were placed before us from which it would appear that the assessee had borrowed monies for the purpose of business but this would not be sufficient. We, therefore, set aside the orders of the authorities below and restore the matter to the file of the ITO for scrutinising whether the monies in respect of which the claim for interest had been made were in fact utilised for the purpose of business. In case, the borrowed monies were utilised for the purpose of business, the fact that a partner had borrowed monies from the current earning of the firm for his private needs would not disentitle the assessee to the claim for interest on the borrowed funds, following the Bombay High Court s decision in the case of Bombay Samachar Limited (1). The appeal will, therefore, be treated as partly allowed.
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1979 (12) TMI 99
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... ... ..... , though casual and non-recurring, may be taxable as income arising from business. Reference may be made to the decision in the case of Ram Kumar Agarwala.(5) Mrs. Alexander (6) and Ghaneka (7). If the facts and the circumstances of the case are examined closely in the light of cl. 22 of the Articles of Association it would be clear that the transaction in question was entered into by the assessee with the intention of trading. So the rental income in question in both the years should be assessed as income from business. 10. In view of the aforesaid discussion, in my opinion, the ld. CIT (A) was not correct in holding that income in question should be assessed under the head income from other sources . 11. Accordingly, the finding of the ld. CIT is set aside. The ld. ITO shall assess the rental income as income from business. He shall allow all the business expenditure which were incurred by the assessee in earning such income. 12. In the result, both the appeals are allowed.
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1979 (12) TMI 98
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... ... ..... was the same, which finds place in the sale deed in question. In our opinion, the Competent Authority failed to bring on record cogent evidence for coming to the conclusion that the fair market value of the property exceeds the apparent consideration thereof by more than 25 per cent or 15 per cent of such apparent consideration. There is also no satisfactory evidence on record to establish that the instrument of transfer was executed with the object of facilitating the reduction or evasion of the liability of the transferor to pay tax under the IT Act, 1961, in respect of the income arising from such transfer. The transaction in question is quite genuine and was bona fidely executed. Thus, the Competent Authority was not justified in starting proceedings under s. 269C of the IT Act, 1961. 19. For the reasons discussed above, the order of the Competent Authority passed under s. 269F(6)should be cancelled. Accordingly, it is cancelled. 20. In the result, the appeal is allowed.
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1979 (12) TMI 97
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... ... ..... he reasons stated above. 69. The position, thus, is that there is no indication either in the main provision, or in the Rules as to whether the capital employed is to be as on this first day of the previous year or on the last day of the previous year, or at any point of time during the previous year. This being the position, s. 80J has to be construed in a manner most beneficial to the assessee. This view was taken by Their Lordships of the Supreme Court in CIT vs. Vegetable Products Ltd. (14). Following this view, their Lordships of the Punjab and Haryana High Court extended this maxim to the value of immovable property in this case of Jaswantrai vs. CWT (15). In my view, therefore, the computation of the capital should be made according r. 19A as on the first day of the computation period and also on the last day of the computation period, and out of the two, which ever is higher, should be adopted as the capital employed in the undertaking in respect of the previous year.
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1979 (12) TMI 96
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... ... ..... ssessee made by voluntary disclosure in respect of the surrendered amount. The sum of Rs. 12,500 is purely an estimated figure which no doubt was added to the assessee s income but on a suggestion by the ITO. The present cases are distinguishable from the facts of the aforesaid judgment and this judgment also does not help the Revenue in any manner. The judgment in Durga Dutta Chunni Lal vs. CIT(6), is also not applicable to the facts of this case because in that case the controversy was as to on whom the onus lies to prove in terms of the explanation to s. 271(1)(c) and that the correct income did not arise from any fraud or gross or wilful neglect and penalty was held to be exigible because all the purchases had not been accounted for and there were numerous discrepancies in the accounts. Since I am holding that no penalty is exigible in this case, the ratio of the judgment in the case of Brij Mohan vs. CIT(7) will not be applicable. 6. In the result, the appeal is allowed.
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1979 (12) TMI 95
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... ... ..... n the IAC passed his final order, his jurisdiction to do so had been taken away by the amendment of s. 274(2), the order passed by him was without jurisdiction . The reference of the case law relied by the Revenue does not rebut the assessee s case because the facts and the question dealt with were different. Before parting with this appeal, we may mention that the argument of the Deptl. Resp. that the Tribunal was not competent to dispose off the appeal is not acceptable. When authority passes an order under the IT Law and a grievance is caused to the party, the party has a right to have that grievance redressed in accordance with the provisions of the law. When the IAC exercised jurisdiction, he exercised it under s. 271(1)(c) r/w s. 274(2) and an appeal lies against that order. Therefore, the Tribunal is competent to entertain that appeal and dispose it off and pass such order thereon as it thinks fit within the meaning of s. 254(1) of the IT Act. 4. The appeal is allowed.
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1979 (12) TMI 94
Assessment Year, Dispose Of, Impartible Estate, Res Judicata, Revised Return ... ... ... ... ..... ssee was not the holder of an impartible estate. (ii) That he was the absolute Ruler, the King, monarch up to the merger and after the merger in 1949, he was reduced to the position of an ordinary citizen to whom the provisions of personal law applied, he being a Hindu, the Hindu law. (iii) That the filing of the returns in the status of individual could not operate as resjudicata by conduct against the assessee from claiming his correct status of a HUF for income-tax purposes. (iv) The disposition of properties by the late assessee during his lifetime constituted an insignificant part of the properties of the HUF keeping in view the size of the assets of the HUF. 28. In the result, the revenue appeal is dismissed and the order of the AAC is confirmed. 29. IT Appeal Nos. 2580 and 2581 (Delhi) of 1977-78 and GT Appeal No. 51 (Delhi) of 1977-78 being merely consequential are also dismissed and the order of the AAC is confirmed. All the four appeals of the revenue are dismissed.
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1979 (12) TMI 93
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... ... ..... earlier previous years. We are unable to agree with the view of the AAC that these amounts were indirectly allowed as a deduction and that s. 41 would be applicable, as there is no material to support such a conclusion. On the authority of the decisions of the Supreme Court and of the Punjab and Haryana High Court, we hold that the royalty receipts would be taxable as income in the hands of the assessee in the three respective years of their collection, namely, Rs. 1,075 1967-68 asst. yr. Rs. 2,879 in 1968-69 asst. yr. and Rs. 8,742 in 1969-70 assessment year. The ITO is directed to take appropriate action and to bring to charge these amounts in the said asst. yrs. in accordance with law. Accordingly, we accept the alternative contention of the ld. counsel and delete the addition of Rs. 12,697 from the income of the assessee in the asst. yr. 1972-73. 13. Since the assessee s main contention in the appeal has not been accepted, this appeal should be treated as partly allowed.
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1979 (12) TMI 90
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... ... ..... se is not excluded. Pathak, J also expressed his disagreement with observations of the majority in the Loka Shiks-hana Trust case (1975) 101 ITR 234 (SC) and expressed his agreement with the observations of Beg, J to the extent that they were to the effect that it was the genuineness of the trust that it was the genuineness of the trust that it is truly charitable which determined the issue. For the same reasons, his Lordship also did not agree with the observations in the Indian Chamber of Commerce case (1975) 101 ITR 796 (SC). 9. Therefore, relying on the various judgements as noted by the Hon ble Supreme Court in its judgement dt. 19th Nov., 1979, we hold that there is absolutely no case for the Revenue, as far as the facts in the present case are concerned, even to argue that the appellant, charitable trust, is not entitled to exemption under s. 11 of the Act. We, therefore, allow these appeals and the additions made in the reassessments are vacated. 10. Appeals allowed.
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1979 (12) TMI 89
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... ... ..... cks, closing stock valuation in that case was given a clean go-bye and which the same as in the case of the assessee. 9. After closely perusing the facts of the case and hearing the parties, in our opinion, the ITO clearly misdirected himself in adopting the value of the closing stock in the assessee s case at market rate and the assessee s method of valuation was in conformity with the earlier years, pattern of closing stock as also in conformity with the other jewellers. Therefore the AAC s approach in the case has been correct that there was no under valuations of stock at all. On such view of the matter, we dismiss the Revenue s appeal. While deciding this appeal, we have closely perused the orders of the ITO and the AAC and the evidence placed before us in the form of copies of trading accounts and other evidence filed before the ITO and the AAC as also the ITO s notice under s. 143 (3) and the assessee s reply thereto. 10. In the result, revenue s appeals is dismissed.
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1979 (12) TMI 88
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... ... ..... tta Railway Co. Ltd. (1940) 8 ITR 280 (Mad) and 11 ITR 380. It only remains to deal with the decision of a Bench of the Tribunal relied on by the assessee. Therein the ITO allowed a similar claim, but later he passed an order reversing it under s. 154. The Tribunal held that s. 154 would not apply since its allowability depended on a long drawn process or reasoning. While holding so, they also observed that the appropriation to the Capital Redumption Fund was a deduction by an overriding title. These observations while disposing of a matter of appeal against order under s. 154 have no relevance here. 9. On a consideration of all the facts, we are satisfied that the assessee is not entitled to claim that Rs. 2,10,000 set apart for the Capital Redumption Fund is not part of the Society s income. The Society also cannot claim that there is a diversion by overriding title. There is no loss to be considered under s. 28 nor any expenditure under s. 37. 10. The appeal is dismissed.
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1979 (12) TMI 87
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... ... ..... he AAC that no addition was called for to the trading results as shown by the assessee. 6. We many further notice that the ITO violated the ratio of the following decisions in not putting across to the assessee basis of the proposed addition before finally making it and in not bringing comparable cases on record. 1. Y.V.M. Somaraju and Co. vs. CIT(1), 2. S.S. Setty and Sons vs. CIT(2), 3. Kmoyammankutty vs. ITO(3), 4. P. Subbaraidu and Co. vs. CIT(4). We may further notice that the ITO had not brought any material on record reflecting the trading conditions existing during the relevant accounting year. Trading conditions need not remain uniform from year to year and it would normally be necessary for the ITO to deal with the relevant trading conditions. Apart from this, we find that for the two subsequent years, the trading results shown by the assessee have been accepted. We therefore, agree with the conclusion of the AAC. 7. In result, the departmental appeal is dismissed.
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1979 (12) TMI 86
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... ... ..... a High Court where cash deposits were surrendered by the assessee on the basis that there was no material on record to show that surrendered item was the income of the assessee. Even in the case where the assessee had offered to be penalised, in other words, conceded the minimum penalty, it was not sustained by their Lordships of Mysore High Court in D. Halappa Sons vs. CIT (1974) 95 ITR 543 (Mys) because none of the authorities had stated that the assessee had consciously concealed the particulars of income. 11. The penalties in these two cases cannot be sustained even as per proviso, as no gross neglect of fraud has been established by the Revenue and the assessee s contention in this regard is supported by CIT vs. Musaddilal Singh (1977) 106 ITR 672 (All) and Addl. CIT vs. Kashiram Mathura Prasad (1979) 119 ITR 497 (Pat). The penalties in both these years are, therefore, remitted and the two appeals of the assessee are accepted. 12. In the result, the appeals are allowed.
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1979 (12) TMI 85
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... ... ..... rebate was Rs. 1,87,686 the income of the priority industry was Rs. 1,20,791 which could be treated as being available out of the balance of Rs. 2,07,617 assessed to tax. But this plea implies that the unabsorbed depreciation and development rebate is to be set off against income from other sources leaving the income from priority industry in fact for deduction under s. 80-J. Such an implication cannot be accepted since the unabsorbed depreciation and development rebate related to the priority business. Therefore, we are unable to accept the assessee s contention. The decision of the ITO to carry forward the deduction under s. 80-J, as not allowable in this assessment year was correct and must be confirmed. However he has to recompute the amount of deduction that has to be carried forward in the light of our decision above. For that purpose, the orders of the authorities below are set aside and the matter is restored to the ITO. The appeal shall be treated as partly allowed.
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1979 (12) TMI 84
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... ... ..... ourt took the view that the return was not invalid, we find no jurisdiction to agree with the ITO that a return dt. 29th Aug., 1975 was invalid. For the reasons, we hold that the return dt. 29th Aug., 1975 was not invalid and omission to sign the return was simply a defect which was curable not only before the ITO but even before the appellate authority. We are, therefore, of the view that in the circumstances of the case, it cannot be said that no return was filed on 29th Aug., 1975. Omission to sign the return is merely irregularity which can be cured even at the stage of the appeal. There is no scope of any debate in this view and, therefore, we hold that the view taken by the CIT(A) is erroneous. The application of the assessee made under s. 154 cannot be partly rejected on this ground. For the reasons, we reserve the order of the authorities below and direct the ITO not to charge penal interest under s. 139(8) upto 6th May, 1977. 5. In the result, the appeal is allowed.
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1979 (12) TMI 83
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... ... ..... ce, these appeals before us. 5. Heard the learned counsel for the assessee Shri M.H. Singhal and the learned authorised representative of the Department Shri Sheo Prasad. In this case, we have noted that the assessee has not challenged the findings given by the ITO in respect of his HUF assessment. Thus, if the assessment in the case of HUF has not been challenged by the assessee and he has accepted the same even on protective basis, the question of further adding the same to the income of the individual will not arise as, if the ITO was not satisfied with the plea of the assessee, he should have treated the HUF as an AOP but since he failed to do the same, we consider it reasonable to hold that there was no justification on the part of the authorities below to have added back the income from property to the income of the individual also. In this view of the matter, we delete the addition made in both the years under consideration and allow the appeals filed by the assessee.
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1979 (12) TMI 82
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... ... ..... t Rs. 3,93,000 (15,770 x 25) . 5. Value of one half share of the assessee was, thus taken at Rs. 1,96,500 for both the years under appeal. Aggrieved, the assessee went up in appeal to the AAC who agreed with the WTO. 6. Before us, Shri Sadh argued that the WTO was not justified in taking the multiple 25 and that proper multiple is 16. Rental income as computed by the approved valuer at Rs. 15,720 was not disputed by the WTO. The only dispute is that the multiple 25 which was taken by the WTO is not correct. In our opinion, the WTO should have taken the multiple 20 instead of the 25. We accordingly direct the WTO to recompute the value of the property taking the multiple 20. 7. Ground No. 7 having been raised in the grounds of appeal pertaining to the asst. yr. 1975-76 has not been pressed by the assessee s counsel and, therefore, the same is rejected. No such ground was raised by the assessee for the next following year. 8. In the result, both the appeals are partly allowed.
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