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Income Tax - Case Laws
Showing 21 to 40 of 185 Records
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2006 (3) TMI 557 - ITAT MUMBAI
Income from house property ... ... ... ... ..... ccupied governed by the Rent Control Act must be limited by the measure of a standard rent determinable under the Act. Following the Judgment of the Apex Court, the ALV is being determining on the basis of the standard rent to be fixed under the particular Rent Control Act. But, whenever, Rent Control Act is not applicable to the properties, the ALV can be worked out after taking into the surrounding circumstances and the rent which the landlord might realize if the building is let in an ordinary course without taking interest-free security deposits. In the instant case, since the evidence is filed by the assessee itself speaks that this property can fetch rent at Rs. 80,000 p.m., the Assessing Officer has rightly adopted the same to determine the ALV of the property. We, therefore, do not find any infirmity in the assessment order. Accordingly, we, set aside the order of the CIT(A) and restore that of the Assessing Officer. 8. In the result, appeal of the Revenue is allowed.
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2006 (3) TMI 556 - ITAT MUMBAI
Appellate Tribunal - Seeking rectification of the order of the Tribunal - error apparent from the record - Validity of the reopening of the assessment - HELD THAT:- The Tribunal ought to have send the matter back to the CIT(A) to adjudicate the issue regarding the validity of the reopening of the assessment as it was not adjudicated by him on the premise that the relief was given on merit. But, the Tribunal has out-rightly set aside the order of the CIT(A) and restore that of the Assessing Officer confirming the additions made by him without having adjudicated the issue of validity of the reopening of the assessment.
To our mind, this action of the Tribunal leads to a mistake crept in the order of the Tribunal which is apparent from the record. We have also carefully examined the contentions of the assessee on other points and we find that the Tribunal has not examined the aspect of applicability of provisions of section 45(2) of the Income-tax Act when the investment shown in shares were converted in stock-in-trade. The Tribunal has also not taken into account while disposing off the appeal that in the financial year 1991-92, the assessee has purchased sizable number of shares and were reflected as investment in the balance sheet as on 31-3-1992 which was accepted by the department in that assessment year. Once, revenue has accepted the method of accounting in earlier years, it cannot be rejected in the subsequent assessment years without bringing contrary on record. We have also carefully examined the orders of the Tribunal referred to by the assessee in which under identical circumstances, the investment in shares, were treated to be the investment and on its transfer the capital gain was worked out. But, the Tribunal did not take much cognizance of these judgments of the Tribunal. The Judgment of the Kerala High Court in the case of Kethan Kumar A. Shah [1999 (8) TMI 20 - KERALA HIGH COURT] was also not properly taken into account by the Tribunal while disposing off the appeal. We have also examined various judgments referred to by the assessee with regard to the scope of section 254(2) of the I.T. Act and from its reading we find that the order of the Tribunal can be rectified or recalled when it is noticed that certain important judgments or the relevant evidence were not considered by the Tribunal while disposing off the appeal.
Turning to the case in hand, it is noticed that, material evidence and the important judgments referred to by the assessee, escaped the attention of the Tribunal while disposing off the appeal which lead to a mistake crept in the order of the Tribunal. We, therefore, of the view that the impugned issue requires a fresh adjudication by the Tribunal in the light of evidence and judgments referred to by the assessee. We, therefore, recall our order dated 31st August, 2005 and direct the Registry to re-fix the appeal for hearing in regular course for hearing.
In the result, miscellaneous application of the assessee is allowed.
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2006 (3) TMI 555 - ITAT DELHI
Business expenditure ... ... ... ... ..... this opportunity either before the CIT(A) or before the Division Bench. I therefore, do not entertain such a request at this stage. 16. Taking the totality of facts and circumstances of this case into consideration, I hold that the CIT(A) was not justified in allowing the deduction of Rs. 53,57,968 in assessment year 1997-98 on account of money advanced by the assessee to M/s. Body Wrap Apparel as business loss without controverting the finding of the Assessing Officer that the said sum had not become irrecoverable during the previous year relevant to assessment year 1997-98, also hold that it was for the assessee to establish that the amount advanced to M/s. Body Wrap Apparel had become irrecoverable in the previous year relevant to assessment year under appeal and accordingly, no deduction is permissible to the assessee in respect of the said amount. 17. The matter may now be placed before the regular Bench in announcing the decision in accordance with the majority opinion.
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2006 (3) TMI 554 - ITAT DELHI
Income escaping assessment ... ... ... ... ..... to it, i.e., the formation of a belief under section 149. In sum, it was the gross income of the assessee minus the statutory deductions directly available to the assessee without the Assessing Officer having to go into the facts, which was the amount to be considered for the purpose of limitation and that has been duly done. Hence, the notion of the assessee that the interest on loan also ought to have been considered, is misconceived. Ergo, the dispute raised by the assessee with regard to limitation goes against him. It is decided accordingly. 10. Since at the outset, the learned counsel for the assessee had made a statement at the bar that he is not going to argue the merits of the case and is going to confine his arguments to the above discussed preliminary issue, we are not going into the merits of the case. The preliminary issue, as above, stands decided against the assessee. 11. In the result, appeal No. 257(Chd.) 2002 filed by the assessee is dismissed, as indicated.
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2006 (3) TMI 553 - ITAT MUMBAI
... ...
... ... ..... 89/Mum./01 (Assessment year 1998-99) 24. In this year the assessee has raised following grounds 1. The ld. CIT(A) erred in holding that the appellants were not entitled to deductions under section 80HHC. 2. The ld. CIT(A) erred in not appreciating the facts with regard to deduction of freight and insurance from export turnover. 3. The ld. CIT(A) erred in dismissing the ground of appeal levy of interest under section 234B. 25. First ground is the same as 2nd ground for the assessment year 1997-98. In accordance with the discussion on the subject in that year we allowed the claim of the assessee. The order of CIT(A) is reversed on this ground. Second ground is also allowed in favour of the assessee as per discussions in ground No. 1 for the assessment year 1997-98. The third ground is consequential. The Assessing Officer will re-computed interest chargeable under section 234B on the basis of income finally assessed. 26. As a result, the appeal of the assessee is partly allowed.
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2006 (3) TMI 551 - ITAT MUMBAI
Interest chargeable ... ... ... ... ..... sessee did not file the return of income under section 139(1) nor under section 139(4) of the Act. Even the notices issued under sections 148 and 142(1) were not responded by the assessee by filing the return of income. The Assessing Officer, thereafter was constrained to frame the assessment under section 144 of the I.T. Act. Therefore, the assessee rsquo s case falls within the category of section 139(1)(b ) of the Act, according to which (sic), the interest is to be charged from the date, following the due date of filing of the return under section 139(1) and ends on the date of completion of the assessment. The Assessing Officer has charged the interest in this manner as admitted by the parties. Therefore, we do not find any infirmity in the mode of computation adopted by the Assessing Officer. We, therefore, confirm the order of the CIT(A) in this regard. Accordingly, the appeals of the assessee are dismissed. In the result, all the appeals of the assessee are dismissed.
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2006 (3) TMI 550 - ITAT MUMBAI
Losses - In speculation business ... ... ... ... ..... ation itself. The test to be applied on the first category of companies is the character of its gross income. It was further held that if the gross total income of the company was mainly made up of income under the head Profit and gains of business/profession , it was caught by the mischief to Explanation to section 73. It is important to note that in the aforesaid decision of the Tribunal, it was held that the transactions of purchase and sale of shares would be held as a speculation business only if the company was hit by the Explanation to section 73. In present case, it has been established that the Explanation to section 73 is applicable to the share transactions and accordingly the resultant loss would be treated as speculation loss. In this view of the matter, we are of the considered opinion that the orders of the Revenue Authorities are in accordance with law and accordingly, we uphold the same. 8-13. These paras are not reproduced here as they involve minor issues.
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2006 (3) TMI 549 - ITAT BANGALORE
Capital gains, Income escaping assessment, ... ... ... ... ..... t of the asset if sold will be considered as per provision of section 50 of the Income-tax Act. It is not disputed that no capital gain is chargeable as per section 50 of the Income-tax Act, as the actual cost of the assets falling within the block of assets acquired during the previous year exceeds the sale consideration of part of the block of assets sold. Moreover, in the case of shops sold, the roof of the shops becomes floor of the other shops while walls of the shops are shared by other shops. Floor of such roof sold to roof of other shops. Such other shops are part of the block assets and it cannot be said that depreciation has not been allowed to such shops which are sharing roof and floor of the shops sold. Hence, it is held that section 50 is applicable and the assessee is not liable for capital gain in respect of shops sold. In the result, the appeal is allowed. ------------------------- In favour of assessee. 1. 46 Taxman 315. 2. 124 Taxman 641. 3.. 27 Taxman 229.
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2006 (3) TMI 548 - ITAT CHANDIGARH
Bad debts, Deductions ... ... ... ... ..... he said order on administrative expenditure including salary of the Director and expenditure relating to Managing Director and functions of Head Office and its control on various units, dismissed the cross objections of the assessee. The ld. CIT(A) has not give any reasoning in coming to a particular conclusion, so this ground is sent back to the file of the ld. Assessing Officer to ascertain the expenses of Head Office and also of the respective units in the light of claimed deduction under section 80-IA/80-IB and to decide the issue. The Assessing Officer is also directed to examine whether these expenses have been proportionately claimed by these units or not. So, this ground of the revenue is allowed for statistical purposes and is being sent to the file of the ld. Assessing Officer for fresh adjudication. 4. Ground No. 5 and 6 in the grounds of appeal are merely prayer, requires no deliberation from our side. 5. In the result, the appeal of the revenue is partly allowed.
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2006 (3) TMI 547 - ITAT AHMEDABAD
Charitable or religious trust ... ... ... ... ..... t under question, has to prevail. If the view adopted by the revenue authorities is to be accepted, the entire allotted budget of Rs. 5 lakhs, i.e., including another sum of Rs. 2.60 lakhs, would stand to be similarly disallowed, as, apparently, celebrating its long period of existence cannot, by itself, lead to the promotion of the game. The issue cannot be, and does not admit of, being viewed in a parochial manner. 6.4 The benefit received, if it can be so termed, by the receipt of the mementos, by the members, is only incidental, and in fact, to our mind, cannot be considered as one the mementos only serving as a trangible reminder of acknowledgement of their services/contribution - ala certificate of merit. 6.5 In view of the foregoing, we find the assessee rsquo s claim as sustainable in law in the facts and circumstances of its case and, resultantly, the order of the ld. CIT(A) is set aside. We order accordingly. 7. In the result, the assessee rsquo s appeal is allowed.
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2006 (3) TMI 546 - ITAT BANGALORE
Capital gains ... ... ... ... ..... A) was not justified in going by the presumption that what is not the value of land is to be considered as value of building. When the assessee has declared the value of building as on 30th March, 1999 at Rs. 210 lakhs as against the cost of the same, which is very likely to depreciate because of wear and tear for the construction carried out before 31-3-1996, in our opinion, the valuation is very fair. The valuation of land should have also considered the approach road. Though certain sale instances are mentioned, the property, which is subject matter of valuation due to its special characteristics, cannot be compared with other sale instances. We accordingly hold that the value assigned to the building is fair, reasonable and do not call for any interference. We accordingly delete the addition in respect of capital gain made in this regard. 6. As regard charging of interest under section 234B, the same is consequential in nature. In the result, the appeal is partly allowed.
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2006 (3) TMI 545 - ITAT BANGALORE
Filling of revised return - Number of times revised return can be filled - assessment had been completed through an intimation u/s 143(1) - second revised return assessee claimed bad and doubtful debts - AO ignored this second revised return on the ground that the assessee loses the right of filing any revised return under section 139(5) after the assessment has been completed - Since the original return and the first revised return were processed u/s 143(1) prior to the filing of second revised return, it is held that the second revised return cannot be entertained as it is invalid and also disallowed the claim of bad and doubtful debts
HELD THAT:- We are in total agreement with the finding of learned CIT(A). An assessee can file revised return as many number of times so long as it is within the limitation period and if the assessee discovers any omission or wrong statement therein. If the Assessing Officer takes cognizance of first revised return filed on 23-5-2000, even if the earlier return was processed under section 143(1)(a) on 27-3-2000, since the revised return was filed on 17-1-2001, which is within one year from the end of the relevant assessment year, the same is valid and hence learned CIT(A) was justified in having cognizance of the same.
Liability of claim of bad debts - As after the amendment of section 36(1)(vii) w.e.f. 1-4-1989, the assessee is no longer required to prove that the debts have become bad in particular year. So long as the write off is bona fide,, the Assessing Officer cannot question whether the debt has become bad in a particular year. Since what has been written off in the books of account, the same was rightly held allowable by learned CIT(A).
Revenue appeal dismissed.
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2006 (3) TMI 543 - ITAT MUMBAI
Bad debts, Income escaping assessment, ... ... ... ... ..... these facts, when except putting forth the argument that the assessee had considered interest received as income from business which has been accepted in the earlier assessment years, there is no material in support of the fact that the assessee is carrying on money lending business. Under these facts, when there is no material on record to establish that the assessee is carrying on money lending business, except relying on a few clauses amongst several other general clauses under the head other objects in the Memorandum of Association and Articles of Association, we are of the opinion that the bad debt written off cannot be claimed as arising from the business of money lending. With these observations, we hold that the action of the Assessing Officer in treating the bad debts written off only as write off of a capital asset but not writing off bad debts, the action of which has been confirmed by the CIT(A), is correct. 12. In the result, assessee rsquo s appeal is dismissed.
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2006 (3) TMI 536 - ITAT MUMBAI
Business expenditure, Business loss ... ... ... ... ..... as only an isolated transaction. As rightly pointed out by the learned CIT(A), if the interpretation of the issue as given by the assessing authority is accepted for a moment, it would not be possible for any company to invest in the shares of another company and to dispose of the investment subsequently, without inviting the wrath of Explanation to section 73. The Delhi Bench of the Tribunal in the case of Annam Partfolio Pvt. Ltd. v. DCIT 92 ITD 324 has held that the provisions contained in the Explanation to section 73 could be invoked only where a device is adopted by an assessee-company to reduce its taxable income. In the present case, there is no such case as the transaction itself was an isolated one. Therefore, in the facts and circumstances of the case, we do not find any reason to interfere in the order passed by the CIT(A). 7. In result, this appeal filed by the Revenue is dismissed as devoid of merit. 8. Order pronounced in the open court, at the time of hearing.
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2006 (3) TMI 534 - ITAT BANGALORE
Penalty - For failure to get accounts audited ... ... ... ... ..... he explanation before the Assessing Officer in not being able to get his accounts audited before the due date. In support of the illness of the Accountant, the assessee filed medical certificate. The learned Assessing Officer has not been able to establish that the reasons given by the assessee were false. After survey, the assessee has to attend post survey proceedings. Unless the opening balances are written, the accounts cannot be audited. Moreover, it is also not denied that FD ledger was not released to the assessee. Keeping in view the explanation offered by the assessee before the Assessing Officer, we feel it fair and reasonable to hold that learned Commissioner of Income-tax (Appeals) was justified in holding that there was reasonable cause with the assessee in not getting his accounts audited before the due date. Hence, the learned Commissioner of Income-tax (Appeals) was justified in deleting the penalty. In the result, the appeal filed by the revenue is dismissed.
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2006 (3) TMI 533 - ITAT MUMBAI
Interest on borrowed capital, Share of profits to partner of firm, Losses - Set off and carry forward of, registered firms
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2006 (3) TMI 532 - ITAT HYDERABAD
... ...
... ... ..... discussion, we hold that compensation paid to the assessee was a capital receipt not liable to tax. 6.29 Thus, on a conspectus of the matter and applying the principle laid down by the Courts to the facts of the case, we are of the considered opinion that the facts and circumstances of the case clearly demonstrate that the receipt in question, undoubtedly was not only for transfer of certain rights in a capital asset, but also for giving up or waiver of certain rights of enduring nature as well as for accepting certain restrictive covenants and for partial impairment of the profit-making apparatus of the company, i.e., Brand SHANVCTM-B and the secret knowledge etc., and thus, the same is a capital receipt. The receipt was not for stock in trade or for transfer of any circulating capital. Thus, we accept the contention of the assessee that the receipt in question, is a capital receipt, and allow the appeal of the assessee. 7. In the result, assessee rsquo s appeal is allowed.
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2006 (3) TMI 528 - ITAT DELHI
Losses - In speculation business ... ... ... ... ..... etter investments. The ld. CIT(A) has given a finding that the assessee has earned interest of Rs. 7,37,610 which is the business income earned from granting of loans and advances. Thus the net income earned under the head Business profits and gains is Rs. 4.93 lakhs. The assessee has also earned dividend income of Rs. 0.13 lakh assessable under the head Income from other sources. Thus the income of the assessee does not consist mainly of income chargeable under the head Income from other sources . The Explanation to section 73 is, therefore, applicable to the assessee-company and the loss suffered by the assessee in the purchase and sale of shares is deemed to be a speculative loss of the assessee and would not be entitled any deduction from the business income of the assessee. Hence we reverse the order of the CIT(A) and restore back the order of the Assessing Officer. The grounds of appeal of the Revenue are allowed. 31. In the result, the appeal of the Revenue is allowed.
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2006 (3) TMI 304 - ITAT PUNE
Chargeable As ... ... ... ... ..... se that the rate difference collected by the assessee and subsequently passed on to its members has rightly been taken as a part of the trading receipt and the claim of deduction was justifiably rejected by the revenue authorities. 3. The Hon ble Vice President (Mumbai Zone), Shri K.P.T. Thangal as a Third Member vide his order dated 30-3-2006 agreed with the view of the ld. Accountant Member on the issue referred to him. 4. Thus, by majority view we hold that the rate difference distributed amongst the members by the assessee-society of Rs. 2,24,84,410 for assessment year 1991-92 and of Rs. 1,22,11,637 for the assessment year 1992-93 cannot be treated as income of the assessee-society and accordingly to that extent the orders of the Assessing Officer and the CIT(A) are set aside. No other issues were involved in these appeals filed by the assessee. 5. In the result, the appeals filed by the assessee for both the assessment years 1991-92 and 1992-93 are, accordingly, allowed.
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2006 (3) TMI 301 - ITAT PUNE-A
Business Disallowance ... ... ... ... ..... on ble Supreme Court in the case of CIT v. Scindia Steam Navigation Co. Ltd. 1961 42 ITR 589. In that case the 4th proviso to section 10(2)(vii) of the 1922 Act, came into force on 5-3-1946, and it was not retrospective. It was held that this proviso was not applicable to assessment year 1946-47 for the reason that the law as it stood on 1-4-1946 will be applicable in making the assessment for assessment year 1946-47. 2.11 In view of the aforesaid discussion, we are of the view that rule 6DD(j) as it stood prior to this omission on 25-7-1995, is not applicable for making assessment for assessment year 1996-97. Accordingly, we are also of the view that the learned CIT(A) was right in coming to the conclusion that 20 per cent of the amount paid in cash to M/s. Sanjeev Traders has to be disallowed in computing the income of the assessee for this assessment year. Thus, ground Nos. 1 and 2 are dismissed. 3.1 to 5. These paras are not reproduced here as they involved minor issues.
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