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1982 (7) TMI 13
Special Deduction ... ... ... ... ..... Court. The Supreme Court has referred to the fact that all the three High Courts, namely, Bombay, Calcutta and Madras, have taken a uniform view that the entire amount of dividends received from the Indian companies by the assessee was exempt from super-tax and that exemption was not limited to the dividend income only in accordance with the provisions of the Act and forming part of the total income. Having regard to the view taken by the Supreme Court in the above case., which has approved the uniform view taken by the three High Courts of Madras, Bombay and Calcutta, the decision of the Tribunal which is in accord with the decisions of this court in CIT v. Madras Motor and General Insurance Co. Ltd. 1975 99 ITR 243 and Madras Auto Service v. ITO 1975 101 ITR 589, his to be held to have correctly interpreted the provisions of s. 80L of the Act. The question referred in both the cases is answered in the affirmative and against the Revenue. There will be no order as to costs.
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1982 (7) TMI 12
... ... ... ... ..... of escaped assessment within the meaning of the said section. But the assessing authority has got to proceed to assess or reassess within five years following the close of the year for which the turnover is proposed to be assessed or reassessed. Strong reliance has been placed by the assessee on the passage we have extracted above from the judgment of the Supreme Court. In our opinion, the problem before us is quite different. The distinction between assess and proceed to assess does not throw any light on the, question before us. In view of the, facts of this case, and in view of the principles laid down by the Supreme Court in the case of CIT v. S. Raman Chettiar 1965 55 ITR 630, the assessment orders must be held to be validly made. We, therefore, answer the first question in the affirmative and in favour of the Revenue. The second question is answered in the negative and in favour of the Revenue. Each party will bear and pay its own costs. SABYASACHI MUKHARJI J.-I agree.
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1982 (7) TMI 11
... ... ... ... ..... ssessee, a larger monthly sum would have been awarded to her on account of alimony. It is not as if the payment of Rs. 25,000 can be looked upon as a commutation of any future monthly or annual payments because there was no pre-existing right in the assessee to obtain any monthly payment at all. Nor is there anything in the decree to indicate that Rs. 25,000 were paid in commutation of any right to any periodic payment. In these circumstances, in our view, the receipt of that amount must be looked upon as a capital receipt. In view of this, we do not think it necessary to consider whether the said receipt could he regarded as casual receipt or in the nature of a windfall. In the result, we answer the questions, as re-framed by us, as follows Question No. 1 In the negative and in favour of the assessee. Question No. 2 In the affirmative and against the assessee. In view of the divided success which the parties have achieved in the reference, there will be no order as to costs.
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1982 (7) TMI 10
Business Expenditure, Entertainment Expenditure ... ... ... ... ..... its true construction and meaning would include the acts or practice of receiving and entertaining the strangers and friends, but if the acts or practice of being hospitable in the sense of providing meals, drinks or other wants of guests are part and parcel of the express or implied terms and conditions of business, trade or profession or on account of long-standing custom in such trade, business or profession, they would not amount to acts of entertainment. We further held that hospitality shown on account of obligation of business arising as a result of an express or implied contract or arising on account of the long-standing custom of a trade cannot amount to entertainment . In view of this decision, the reference has to be answered in the affirmative and in favour of the assessee.. In our opinion, therefore, our answer to the question referred to us is in the affirmative and in favour of the assessee. In the circumstances of the case, parties shall bear their own costs.
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1982 (7) TMI 9
Balancing Charge, Business, Depreciation, Depreciation Actually Allowed, Obsolescence, Written Down Value
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1982 (7) TMI 8
Business Expenditure ... ... ... ... ..... S.Y. 2021. There is nothing in the release deed to show that the release was indicated to be made effective in S.Y. 2010. Indeed, the recitals are to the contrary. Mr. Pandit appearing on behalf of the assessee, no doubt, sought to support the view of the Tribunal that the remission was given in S.Y. 2010 and based the argument only on the reference to the figure of Rs. 51,130 which was the amount outstanding at the end of S.Y. 201 0. As already pointed out, these recitals are merely in the nature of a preamble and the real agreement accepting Rs. 16,000 in lieu of Rs. 53,265 would determine as to when the remission took place. This, as we have already pointed out, took place in S.Y. 2021. In the view which we have taken, question No. 1 has to be answered in the affirmative and in favour of the Revenue. Question No. 2 must, consequently, be answered in the affirmative and in favour of the Revenue. However, in the circumstances of the case, there will be no order as to costs.
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1982 (7) TMI 7
Capital Gains ... ... ... ... ..... thorities and the Tribunal were in error in treating the expenditure of Rs. 20,935 as of capital nature. The first question will, therefore, have to be answered in the affirmative and in favour of the assessee. So far as the second question is concerned, the learned counsel for the Revenue and the assessee are agreed that having regard to the view of this court in CIT v. Mrs. Shirinbai P. Pundole 1981 129 ITR 448, the assessee had incurred no liability to capital gains. In Shirinbai Pundole s case, this court has taken the view that the surrender of the tenancy right in exchange for an ownership flat in the building did not attract capital gains tax under s. 45 of the I.T. Act, 1961. Accordingly, question No. 2 has to be answered in favour of the assessee. The two questions referred are answered as follows Question No. 1-In the affirmative and in favour of the assessee. Question No. 2-In the negative and in favour of the assessee. Assessee to get the costs of this reference.
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1982 (7) TMI 6
Collaboration Agreement ... ... ... ... ..... reign know-how is availed of in lieu of payment, is in substance transaction of acquiring the necessary technical information with regard to the technique of production and technical know-how made available by a party to such an agreement does not stand on the, same footing as protected rights under a registered patent. It is clear, therefore, that the assessee-company had not acquired anything which could be described as capital asset. Whether the payment is made before the start of the manufacture or is made because of the recurring liability under the agreement, makes no difference to the nature of the transaction. In our view, the Tribunal was justified in holding that the expenditure of Rs. 1,20,250 was of a revenue nature and was allowable as a deduction in computing the total income of the assessee. In the view which we have taken, the question referred has to be answered in the affirmative and in favour of the assessee. The Commissioner to pay costs of the reference.
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1982 (7) TMI 5
Expenditure Wholly And Exclusively For Business ... ... ... ... ..... the director fell ill, it is difficult to see how, in the absence of any binding obligation on the company, the company was bound to provide for the expenditure incurred by the director consequent upon his sickness. The Tribunal also found that the insurance proposal itself was submitted not by the company but by the director. If there was no obligation on the assessee-company to reimburse the director in respect of loss of personal luggage or loss resulting from accident or sickness, it is clear that taking out such insurance and payment of insurance premium cannot be said to be expenses incurred wholly and exclusively for the purposes of the business of the assesseecompany. The second question must also, therefore, be answered against the assessee-company. The two questions referred are, therefore, answered as follows Question No. 1 In the negative and against the assessee. Question No. 2 In the negative and against the assessee. The assessee to pay costs of the reference.
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1982 (7) TMI 4
Business Expenditure, Disallowance, Practice ... ... ... ... ..... at the contrary view was expressed by the Division Bench of the Madras High Court in the case of S. Vaidyanathaswami v. CIT 1979 119 ITR 369. Our attention was also drawn to several other authorities to find out the well settled principle as enunciated by the Supreme Court, the Full Bench of the Madras High Court as well as of this court. It is not necessary, in our opinion, to discuss all those decisions in detail. We may incidentally point out that all the authorities, viz., the ITO, the AAC and the Tribunal, unanimously held that the asset did not cost anything to the assessee. Further, learned advocate for the Revenue pointed out that it was because of the nature of the asset. Be that as it may, this finding of fact his not been challenged before us. For the aforesaid reasons, we must answer the question in the affirmative and in favour of the assessee. In the facts and circumstances of the case, the parties will pay and bear their own costs. SUHAS CHANDRA SEN J.-I agree.
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1982 (7) TMI 3
Appeals, Firm ... ... ... ... ..... urt or Tribunal actually does, and not what it should have been done . Applying the aforesaid principle, this court in all the three cases said that since the ITO has passed the order specifically in exercise of his powers under s. 185(1)(b) of the Act, the appeal filed by the assessee before the AAC was maintainable under s. 246(j) of the Act. We have already adverted to annexure A order. It does not purport to have been passed under s. 185(1)(b) of the Act. It does not refer to any provision in the Act at all. Therefore, the principles applied by this court in the three decisions mentioned above in the preceding paragraph are not attracted to the ease on hand. In the result, we answer the question referred to us in the negative, that is to say, in favour of the Revenue and against the assessee. There will be no order as regards costs. A copy of this judgment under the seal of this court and the signature of the Registrar will be forwarded to the Tribunal as required by law.
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1982 (7) TMI 2
Business Expenditure ... ... ... ... ..... s account, it being contended on behalf of the workmen that such a deduction was not justified while determining the available surplus and the allocable surplus for the payment of bonus under the Payment of Bonus Act.. The Supreme Court rejected the contention and held that an estimated liability under the gratuity schemes, even if it amounted to a contingent liability and was not a debt under the W.T . Act, was deductible from the gross receipts while preparing the profit and loss account, if its present value was fairly ascertainable and could be discounted. Having regard to the consistent view taken by the Supreme Court in Standard Mills Co. Ltd. v. CWT 1967 63 ITR 470 (SC), Metal Box Co. of India Ltd. v. Their Workmen 1969 73 ITR 53 (SC) and Vazir Sultan Tobacco Co. Ltd. v. CIT 1981 132 ITR 559 (SC), the decision of the Tribunal, in this case, is to be upheld. The question referred to us has, therefore, to be answered in the affirmative and against the Revenue. No costs.
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1982 (7) TMI 1
... ... ... ... ..... merely because there was a possibility of incurring of losses, it cannot be said that the shares in the partnership could not be impressed with the character of the joint family property, and that neither the Hindu law nor general law prevents an interest in a partnership which is an asset being impressed with the character of the joint family property, which he has done admittedly under the Hindu law. In view of the preponderance of judicial opinion on the question raised here, we have to hold that the Tribunal is right in holding that the assessee s interest in the partnership has been thrown into the common stock and thus being impressed with the character of the joint family and that there is no legal bar either under the Hindu law or under the provisions of the Partnership Act. In this view of the matter, the question has to be answered in the affirmative and in favour of the assessee. The assessee will have the costs from the Revenue. Counsel s fee is fixed at Rs. 500.
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