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Case Laws
Showing 421 to 440 of 2810 Records
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1988 (11) TMI 45
The High Court of Punjab and Haryana ruled in favor of the assessee, a charitable trust, for assessment years 1974-75 and 1975-76, based on a previous decision in CIT v. Guryani Brij Balabh Kaur Trust [1980] 125 ITR 381. The assessee was entitled to exemption under section 11 of the Income-tax Act, 1961. The court left the parties to bear their own costs.
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1988 (11) TMI 44
Issues:
Claim of weighted deduction under section 35B of the Income-tax Act, 1961 for payment made to a travelling agent for booking orders in foreign countries.
Analysis:
The judgment concerns the claim of an assessee-firm for weighted deduction under section 35B of the Income-tax Act, 1961, in relation to a payment made to a travelling agent for booking orders in foreign countries during the assessment year 1977-78. The travelling agent was responsible for booking orders for the assessee in foreign countries and had booked orders within the parameters set by the assessee. The claim for weighted deduction was initially disallowed by the Income-tax Officer and the Commissioner of Income-tax (Appeals) upheld this decision. However, the Tribunal allowed the weighted deduction in respect of the amount paid to the travelling agent.
The questions referred to the court for opinion were whether booking orders outside India for the supply of goods constitutes performance of service in connection with the execution of the contract for supply of goods outside India, and whether the expenditure incurred on payment of commission for booking orders outside India qualifies for weighted deduction under section 35B(1)(a) of the Income-tax Act.
The court referred to a previous judgment regarding the provisions of section 35B, highlighting that the section is designed to provide deductions to encourage export potential. The court noted that expenditure related to the export of goods is eligible for weighted deduction under this provision. It was observed that expenditure incurred for obtaining information regarding market potentiality for goods to be exported falls within the purview of the relevant clause.
Applying the principles from the previous judgment, the court concluded that the assessee's claim fell under the specific clause of section 35B(1) that entitles weighted deduction for expenditure incurred for services outside India in connection with the execution of a contract for supply of goods outside India. Therefore, both questions were answered in favor of the assessee and against the Revenue. No costs were awarded in the circumstances.
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1988 (11) TMI 43
The High Court of Punjab and Haryana upheld the disallowance of the assessee's claim for surtax liability for the assessment year 1974-75. The decision was based on precedents from various High Courts, including Simon Carves India Ltd. v. CIT [1988] 173 ITR 660(Cal), S. L. M. Maneklal Industries v. CIT [1988] 172 ITR 176 (Guj), and Organon (India) Ltd. v. CIT [1988] 172 ITR 354 (Cal). The court ruled in favor of the Revenue and each party was directed to bear their own costs.
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1988 (11) TMI 42
The High Court held that the Tribunal was correct in canceling the penalty imposed by the Inspecting Assistant Commissioner under section 271(1)(c) of the Income-tax Act. The assessee's evidence showing the actual sale price of the closing stock rebutted the presumption of undervaluation. The court cited previous decisions to support its ruling. The penalty was canceled, and no costs were awarded.
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1988 (11) TMI 41
The High Court of Punjab and Haryana delivered a judgment on the assessment years 1972-73 and 1973-74 regarding unreasonable remuneration paid to individuals and disallowance of certain expenses. The court found in favor of the Revenue based on a previous decision related to similar issues from the assessment year 1970-71.
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1988 (11) TMI 40
The High Court of Punjab and Haryana ruled in favor of the assessee, Avery Freewheels (P.) Ltd., in a case concerning interest under section 214 of the Income-tax Act, 1961. The court held that the payment of the instalment by cheque on March 15, 1976, entitled the assessee to interest, as the cheque was encashed within the financial year. The Tribunal's decision was upheld, citing precedent that payment by cheque relates back to the date of receipt. The court answered the question of law in the negative, in favor of the assessee.
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1988 (11) TMI 39
The High Court of Punjab and Haryana addressed surtax assessment under the Companies (Profits) Surtax Act, 1964. Two questions of law were considered regarding deductions and computation of capital employed. The court ruled in favor of the assessee for both questions based on relevant judgments.
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1988 (11) TMI 38
Issues Involved:
1. Whether the Central sales tax collected by the assessee forms part of the trading receipt.
2. Whether the assessee can claim deduction of the sales tax out of the trading receipts upon payment or when the liability to pay arises.
3. The validity of notices issued u/s 154/155 and 147/148 of the Income-tax Act, 1961.
Summary:
Issue 1: Central Sales Tax as Trading Receipt
The court confirmed that the Central sales tax collected by the assessee forms part of the trading receipt within the meaning of the Income-tax Act. This applies regardless of whether the sales tax is separately added or included in the sale price.
Issue 2: Deduction of Sales Tax in Mercantile System
The court addressed the question of when an assessee following the mercantile system of accounting can claim a deduction for sales tax. It referred to the Supreme Court's decision in Kedarnath Jute Manufacturing Co. Ltd. v. CIT [1971] 82 ITR 363, which held that the liability to pay sales tax arises the moment sales are made, and thus, the assessee is entitled to deduct the liability from profits even if the tax has not been paid. The court clarified that the decision in Chowringhee Sales Bureau P. Ltd. v. CIT [1973] 87 ITR 542 did not change this legal position, as it dealt with a different issue regarding the status of an auctioneer under the Bengal Finance (Sales Tax) Act, 1941.
Issue 3: Validity of Notices u/s 154/155 and 147/148
The court found that the later decision of the Supreme Court in Chowringhee Sales Bureau's case did not alter the legal position established in Kedarnath's case. Therefore, the notices issued to the assessee for rectification or reopening the assessment were deemed without jurisdiction. The court emphasized that the original assessments, which allowed the deduction of sales tax based on the accrual of liability, were correctly framed. Consequently, the notices issued u/s 154/155 and 147/148 of the Act were declared illegal and quashed.
Conclusion:
The court set aside the decision of the single judge, allowed the writ petitions, and declared the notices issued u/s 154/155 and 147/148 of the Income-tax Act as illegal. The assessee was awarded costs quantified at Rs. 500 in each case.
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1988 (11) TMI 37
The High Court of Punjab and Haryana decided on the assessment year 1974-75 for Saraswati Industrial Syndicate Limited. The court ruled against the assessee on the issue of 'corrosive chemicals' and interest chargeability under section 139(8) of the Income-tax Act. The judgment cited previous cases and the Supreme Court's decision in Central Provinces Manganese Ore Co. Ltd. v. CIT [1986] 160 ITR 961. The court disposed of the reference with no order as to costs.
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1988 (11) TMI 36
The High Court of Punjab and Haryana ruled that deductions admissible as donations under section 80G of the Income-tax Act, 1961, could not be considered as sums 'not includible' in income for Income-tax assessments. The court referred to previous decisions and answered the question in favor of the assessee, following the precedent set in Avery Cycle Industries Private Ltd.'s case [1989] 178 ITR 173.
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1988 (11) TMI 35
Issues: Interpretation of section 79(a) of the Income-tax Act, 1961 for assessment years 1974-75 and 1976-77.
In this judgment delivered by Gokal Chand Mital J., the High Court was tasked with determining the applicability of section 79(a) of the Income-tax Act, 1961 for the assessment years 1974-75 and 1976-77. The Tribunal had referred two questions for the court's opinion regarding the interpretation of this section. The crux of the matter was whether the change in shareholding, as contemplated in section 79, should be based on a comparison of voting power between the last day of the current assessment year and the corresponding position in the year of the loss claimed for set off. The Tribunal had held that section 79 would be attracted in this case, emphasizing the need for the Income-tax Officer to consider not only the voting power test but also whether the change in shareholding was aimed at avoiding tax liability. The court agreed with the Tribunal's interpretation, stating that the provisions of section 79(a) were clearly attracted in this scenario.
Regarding the assessment year 1974-75, the court highlighted that the Income-tax Officer had not applied his mind to clause (b) of section 79 before withdrawing the set off of the loss from the assessment year 1970-71. Section 79 provides an exception if the change in shareholding was not intended to avoid tax liability. As this crucial test was not applied by the Income-tax Officer, the court set aside the findings of the Appellate Assistant Commissioner and directed the Income-tax Officer to reconsider the issue. The court also directed the Income-tax Officer to assess the set off of the loss for the assessment year 1976-77 in light of the decision taken for 1974-75. The court emphasized that the loss for the assessment year 1971-72 could be carried forward and set off in both the assessment years 1974-75 and 1976-77. The Income-tax Officer was instructed to consider this while disposing of the issue for these years.
In conclusion, the High Court affirmed the Tribunal's interpretation of section 79(a) and answered both questions in favor of the Revenue and against the assessee. The court found that the provisions of section 79(a) were applicable in this case, emphasizing the importance of considering the change in shareholding and its implications on tax liability in such matters.
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1988 (11) TMI 34
The High Court held that registration benefits cannot be denied due to lack of guardian's signature unless the guardian refused to sign. The court relied on CBDT Circular and Supreme Court decisions, stating that circulars are binding on the Department. The Revenue's application for mandamus was dismissed, with no costs awarded.
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1988 (11) TMI 33
The High Court of Punjab and Haryana upheld the Income-tax Appellate Tribunal's decision to grant relief of Rs. 14,000 for yarn purchased after the manufacturing activity of the assessee had ceased. The Tribunal's findings supported the assessee's claim for the benefit based on the quantity and value of yarn utilized for manufacturing goods actually exported. The court ruled in favor of the assessee, with each party bearing their own costs.
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1988 (11) TMI 32
Issues:
Interpretation of annual letting value for self-occupied property under Rent Control Act.
Analysis:
The judgment addressed the issue of determining the annual letting value of a self-occupied property in relation to the open market rent versus the standard rent fixed under any Rent Control Act. The case involved co-owners of a residential house in Amritsar, which was self-occupied and not let out to a tenant. The Income-tax Officer initially estimated the annual letting value, which was contested by the assessee. The Tribunal maintained the annual value based on the open market rent, rejecting the argument that the value should be determined according to the provisions of the Rent Control Act. The Tribunal relied on the Supreme Court decision in M. M. Chawla v. J. S. Sethi [1970] 2 SCR 390. However, the High Court referred to subsequent decisions, including Dewan Daulat Rag Kapoor v. New Delhi Municipal Committee [1980] 122 ITR 700, emphasizing that the annual value should be limited to the standard rent determinable under the Rent Control Act, even for self-occupied properties.
The judgment highlighted the legislative intent behind rent control legislation, emphasizing that standard rent represents a reasonable measure set by the legislature to prevent exploitative rent practices. The court questioned the variation in annual value based on property occupancy status and reiterated that recovery of rent exceeding the standard rent is considered exploitative and unreasonable. The court referenced the decision in Guntur Municipal Council v. Guntur Town Rate Payers' Association, AIR 1971 SC. 353, to support the interpretation that standard rent can be determined not only by the Rent Controller but also by municipal authorities for property tax purposes.
Furthermore, the judgment cited previous court decisions, including Panna Lal Talwar v. CIT [1980] 125 ITR 152 and Mrs. Sheila Kaushish v. CIT [1981] 131 ITR 435, which addressed similar issues regarding the determination of annual letting value for self-occupied properties. The courts in these cases emphasized the importance of considering the fair rent determinable under the Rent Control Act for assessing the annual value. Ultimately, the High Court held that the Income-tax Officer had the jurisdiction to determine the gross annual letting value based on the principles laid down in the Rent Control Act, leading to a decision in favor of the assessee against the Revenue.
In conclusion, the judgment clarified that the annual letting value of a self-occupied property should be determined based on the standard rent prescribed by the Rent Control Act, even if the property is not let out to a tenant. The decision underscored the legislative intent to prevent exploitative rent practices and ensure a reasonable measure of rent for both landlords and tenants.
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1988 (11) TMI 31
The High Court dealt with the reopening of an assessment due to a change in the law regarding gratuity provision. The reassessment was challenged by the assessee but was ultimately vacated and the original assessment restored based on a previous Supreme Court judgment. The Tribunal was directed to decide the matter again in light of the Supreme Court ruling.
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1988 (11) TMI 30
Issues Involved: Determination of whether rental income derived by the assessee-company from letting out a part of the factory building constitutes 'business income' for assessment years 1971-72, 1973-74, and 1974-75.
Summary:
The assessee, a private limited company engaged in manufacturing rubber goods, faced financial difficulties due to losses and quality issues. To curtail losses, a portion of the factory building was leased out. The Income-tax Officer initially treated the rental income as income under the head "Property" for 1971-72 but accepted it as business income for 1972-73. However, for 1973-74 and 1974-75, the rental income was not accepted as business income by the Income-tax Officer. The Appellate Assistant Commissioner ruled in favor of the assessee, considering the rental income as business income. The Tribunal upheld this decision, emphasizing that leasing out a part of a commercial asset temporarily does not change its nature. The main part of the factory building was still used for business activities. The High Court concurred, citing precedents and the commercial motivation behind the lease. The rental income was deemed as business income, and the question was answered against the Revenue.
In conclusion, the High Court affirmed that the rental income derived by the assessee from letting out a part of the factory building constituted business income based on the commercial nature of the lease and the specific circumstances of the case. The decision was supported by legal precedents and factual considerations, leading to the rejection of the Revenue's appeal.
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1988 (11) TMI 29
The High Court of Punjab and Haryana ruled in favor of the assessee-company regarding the deduction under section 80G of the Income-tax Act for the assessment years 1974-75 and 1975-76. The court adopted the interpretation given by the Kerala High Court and held that the assessee was entitled to proportionate deductions. The question was answered in the affirmative against the Revenue, with each party bearing their own costs.
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1988 (11) TMI 28
The High Court of Punjab and Haryana answered two questions referred by the Income-tax Appellate Tribunal. Question 1 was answered in favor of the Revenue. Question 2, regarding deduction for donated sugar, was answered in favor of the assessee based on previous judgments allowing deductions for gifts in kind.
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1988 (11) TMI 27
The High Court of Punjab and Haryana ruled that the deduction allowed under section 80J could not be considered as a sum not includible in the total income for income-tax assessment. The judgment favored the assessee and went against the Revenue. The case reference is similar to a previous judgment in the High Court of Calcutta.
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1988 (11) TMI 26
Issues:
Claim of interest on advance tax payment for the assessment year 1972-73. Interpretation of sections 214 and 211 of the Income-tax Act, 1961. Determination of interest on advance tax refund based on final assessment.
Analysis:
The judgment delivered by the High Court of Punjab and Haryana addressed the claim of interest on advance tax payment by the assessee, Oswal Woollen Mills Ltd., for the assessment year 1972-73. The relevant period for the assessment was the calendar year 1971, and the advance tax payments made by the assessee were detailed, with the last payment being made on October 10, 1972. The main contention was whether the assessee was entitled to interest on all advance tax payments, as only the last payment was made after the relevant financial year. The Revenue argued that interest was only applicable to payments made within the accounting year of the assessee, up to December 31, 1971.
The Tribunal ruled in favor of the assessee regarding interest on advance tax payments and also addressed the issue of interest on advance tax refund based on the final assessment by the Appellate Assistant Commissioner. The two questions referred to the court were whether the payments made after December 15, 1971, were eligible for interest and whether interest on advance tax refund should be calculated based on the final assessment.
The court referred to sections 214 and 211 of the Income-tax Act, 1961, which govern the payment and calculation of interest on advance tax. It was noted that interest is payable on aggregate advance tax payments exceeding the assessed tax from the following financial year's commencement until the assessment for the subsequent year. The court clarified that the last installment of advance tax for the assessee was due on December 15, 1971, based on the provisions of section 211.
The court rejected the argument of extension for advance tax payment due to trade conditions and ruled partially in favor of the assessee for the sum deposited on December 21, 1971. However, the balance amount was not eligible for interest, favoring the Revenue. The second question was answered in the negative, following precedents set by previous court decisions.
In conclusion, the court disposed of the reference without costs, maintaining the decision against the assessee regarding interest on advance tax payments and refund.
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9911796707
