|
Advanced Search Options
Case Laws
Showing 281 to 300 of 2911 Records
-
1992 (11) TMI 167
The appeal was made regarding the Modvat credit for Phosphoric Acid used in sugar manufacturing. The Collector (Appeals) denied the credit, stating it was identifiable with apparatus. However, the Tribunal disagreed, stating Phosphoric Acid is an input for clarification and not apparatus. The appeal was allowed, setting aside the Collector's order.
-
1992 (11) TMI 166
Issues: Appeal against disallowance of investment allowance on barge engines and screening plant.
Analysis:
1. The appeal by the revenue challenged the order of the CIT(A) allowing investment allowance on barge engines and screening plant. The revenue contended that the engines fitted to an old barge were not eligible for investment allowance and that the assessee, not engaged in manufacturing, was not entitled to investment allowance on mining machinery.
2. The Assessing Officer disallowed the investment allowance claimed by the H.U.F. assessee for two Cummins Engines and a screening plant. The disallowance was based on the failure to fulfill conditions under section 32A(2)(a) or 2(b)(ii) and (iii).
3. The CIT(A) held that the new engines on the barge were eligible for investment allowance as they were part of a ship used in the business of shipping. Additionally, he deemed the engines as machinery. Regarding the screening plant, he considered it machinery used in mining operations, thus allowing investment allowance on both items.
4. During the hearing, the revenue reiterated that investment allowance was not admissible due to non-fulfillment of section 32A conditions. They argued that the engines being fitted to an old barge and the absence of manufacturing activity rendered the allowance inapplicable, citing the Supreme Court's judgment in Idandas v. Anant Ramchandra Phadke.
5. The counsel for the assessee supported the CIT(A)'s decision.
6. The Tribunal concluded that the engines, being part of the barge, did not qualify as new machinery under section 32A. The engines were not independent machinery and did not meet the criteria for new ships or aircraft. As the engines were fitted to an old barge, which was not eligible for investment allowance, the claim was deemed untenable. The judgment in Idandas was referenced for the manufacturing process test, which the engines did not satisfy.
7. Regarding the screening plant, the Tribunal upheld the CIT(A)'s decision, citing the plant's crucial role in mining operations. The Tribunal referenced a previous case involving machinery used in mining operations for manganese ore production to support the allowance of investment. The Tribunal found the machinery used in mining operations, including the screening plant, eligible for investment allowance.
8. Consequently, the appeal was partially allowed, with the decision on the investment allowance for the screening plant upheld while disallowing the allowance for the barge engines.
-
1992 (11) TMI 165
Issues:
1. Taxability of interest not charged on the debit balance of the assessee with a company.
2. Interpretation of perquisites under section 17(2) of the Income-tax Act, 1961.
3. Conflict between decisions of different High Courts regarding the tax treatment of interest-free loans or concessional rate loans granted by companies to directors or employees.
Detailed Analysis:
The judgment pertains to an appeal by the revenue against the deletion of perquisites amounting to Rs. 19,560, representing interest not charged on the debit balance of the assessee with a company. The Assessing Officer had treated the non-charging of interest on the debit balance as a perquisite under section 17(2) of the Income-tax Act, 1961, based on a judgment of the Madras High Court. However, the Dy. CIT (A) deleted this addition, citing a previous decision of the Tribunal in the assessee's case for the assessment year 1979-80. The revenue contended that interest-free advances to directors should be taxable perquisites, relying on various tribunal decisions and the Madras High Court judgment. Conversely, the assessee argued that the Madras High Court judgment was no longer valid, citing a contrary decision by the Calcutta High Court and a Tribunal decision from Bombay. The issue revolved around the tax treatment of interest-free loans or concessional rate loans granted by companies to directors or employees.
The Tribunal analyzed the conflicting decisions of the Madras High Court and the Calcutta High Court regarding the taxability of interest-free loans or concessional rate loans. The Madras High Court had held that non-charging of interest on overdrawn amounts constituted a perquisite under section 17(2) of the Income-tax Act, 1961. In contrast, the Calcutta High Court interpreted the provisions differently, emphasizing that the Parliament's deletion of certain clauses indicated an intention not to tax interest-free loans as perquisites. The Tribunal noted that when two interpretations of fiscal statutes exist, the one favorable to the assessee should be adopted, as per established legal principles. Therefore, the Tribunal preferred the Calcutta High Court's judgment over the Madras High Court's decision, aligning with the view that interest-free loans did not constitute taxable perquisites.
Ultimately, the Tribunal upheld the order of the Dy. CIT (A) and dismissed the revenue's appeal, following the judgment of the Calcutta High Court and the principle of construing taxing statutes in favor of the assessee when multiple interpretations are possible. The decision highlighted the importance of considering conflicting judicial opinions and applying the interpretation most beneficial to the taxpayer in tax matters.
-
1992 (11) TMI 160
Issues:
1. Disallowance of expenses claimed on bonus/commission.
2. Jurisdiction of Assessing Officer under section 143(1)(a).
3. Interpretation of 'prima facie' disallowable items.
Analysis:
1. The appeal addressed the disallowance of expenses claimed by an Insurance Agent on bonus/commission for the assessment year 1989-90. The Assessing Officer allowed expenses against first year's commission but disallowed the entire expenses claimed on bonus/commission. The appellant argued that the bonus/commission was an incentive granted by the LIC for securing new business beyond the minimum requirement, necessitating additional expenses. The appellant cited a letter from LIC to support the claim. The Departmental Representative contended that allowing the double claim of 50% would result in impermissible double deduction.
2. The jurisdiction of the Assessing Officer under section 143(1)(a) was a crucial aspect of the appeal. The appellant argued that the Assessing Officer exceeded their jurisdiction by disallowing the deduction without proper investigation or issuing a notice under section 143(2). The appellant relied on a decision by the Bombay High Court to support their argument. The Tribunal highlighted the requirement for prima facie disallowable items to be clearly identifiable, emphasizing that debatable or arguable matters fall outside the purview of section 143(1)(a).
3. The Tribunal delved into the interpretation of 'prima facie' disallowable items, referencing a decision by the Rajasthan High Court and a Circular issued by the Central Board of Direct Taxes. The Circular outlined specific instances where adjustments could be made based on information provided, emphasizing that only allowances and disallowances explicitly provided for in the IT Act, 1961 could be considered. The Tribunal concurred with the view that the Assessing Officer cannot disallow a claim without proper investigation or issuing a notice under section 143(2), as highlighted in a decision by the Delhi High Court.
4. Ultimately, the Tribunal upheld the appellant's argument, ruling that the Assessing Officer was not justified in disallowing the claim under section 143(1)(a) without proper investigation or issuing a notice under section 143(2). The appeal was allowed in favor of the appellant, emphasizing the importance of due process and proper assessment procedures in determining disallowable items.
-
1992 (11) TMI 158
Issues: Valuation of property covered by the road and valuation of cars.
Valuation of property covered by the road:
The judgment revolves around the valuation of a property covered by a road. The assessee claimed exemption for the property, arguing it was being used as a road not only by them but also by neighboring property owners. The Assessing Officer valued the property based on a report, denying the exemption. The Commissioner (Appeals) acknowledged easement rights but still valued the property to the assessee, allowing a 20% deduction for encumbrance. The assessee contended that the property should be valued at nil due to its use as a public road and the inclusion of its value in conveyance deeds. The Tribunal observed the property was crucial for access to various properties and had easement rights for neighboring owners. It concluded that as the property had no marketable value, it should be valued as nil, overturning the Commissioner's decision.
Valuation of cars:
The judgment briefly addresses the issue of valuing cars, with the assessee's counsel indicating they were not pressing the matter. Consequently, the ground related to the valuation of cars was rejected as not pressed.
In conclusion, the appeal was partly allowed based on the valuation of the property covered by the road, which was determined to be nil due to its lack of marketable value. The issue of valuing cars was not pursued by the assessee's counsel, leading to its rejection.
-
1992 (11) TMI 156
Issues Involved:
1. Inclusion of maintenance value in the net wealth of the assessee under section 4(1A)(c) of the Wealth-tax Act, 1957.
2. Whether the charge created on the property amounts to a transfer of interest.
3. Nexus between the maintenance received by the spouse and the converted property.
4. Applicability of section 4(1A)(c) to the facts of the case.
Detailed Analysis:
1. Inclusion of Maintenance Value in Net Wealth:
The primary issue revolves around whether the maintenance value payable to the assessee's wife by the son, as stipulated in the partition deed, should be included in the net wealth of the assessee under section 4(1A)(c) of the Wealth-tax Act, 1957. The Wealth-tax Officer (WTO) included Rs. 1,80,000 in the assessee's wealth, considering it a deemed asset transferred to the spouse. The Appellate Assistant Commissioner (AAC) upheld this view, stating that the maintenance provision was part of the converted property and thus includible in the assessee's wealth.
2. Charge Created on Property:
The partition deed created a charge on the property allotted to the son to secure the maintenance payable to the mother. The judicial member opined that this charge did not create an interest in the property, referencing the legal distinction between a mortgage and a charge. According to the judicial member, a charge is merely a security and does not amount to a transfer of interest in the property.
3. Nexus Between Maintenance and Converted Property:
The judicial member concluded that there was no nexus between the maintenance payable by the son and the converted property allotted to him. The maintenance obligation was seen as independent of the property partitioned, and thus, section 4(1A)(c) was deemed inapplicable.
4. Applicability of Section 4(1A)(c):
The judicial member argued that since no part of the converted property was transferred to the wife, section 4(1A)(c) did not apply. The maintenance payable by the son was not considered a part of the converted property, and thus, it could not be included in the net wealth of the assessee.
Dissenting Opinion:
The accountant member disagreed, emphasizing the special provisions of the Wealth-tax Act and the legislative intent. He argued that the maintenance provision was an indirect transfer of assets to the spouse, falling within the ambit of section 4(1A)(c). He highlighted the broader interpretation of "transfer" and "property" under allied laws, asserting that the maintenance provision represented the wife's share of the HUF property.
Third Member's Decision:
The third member, agreeing with the judicial member, concluded that:
1. There was no nexus between the right to maintenance and the converted property.
2. The right to maintenance was not part of the converted property subject to the partition.
3. The value of the right to maintenance could not be included in the net wealth of the assessee under section 4(1A)(c).
Final Judgment:
The appeals were allowed, and the addition made under section 4(1A)(c) was deleted from the net wealth of the assessee for all the assessment years under consideration. The Wealth-tax Officer was directed to recompute the net wealth accordingly.
-
1992 (11) TMI 154
Issues:
1. Imposition of penalty under section 273(1)(b) of the Income-tax Act for failure to file a statement of advance tax.
2. Interpretation of provisions of section 209A(1)(a) and section 209 in relation to the requirement of filing a statement of advance tax.
3. Consideration of whether penalty under section 273(1)(b) is exigible when penalty under section 271(1)(c) for concealment of income has been imposed.
Detailed Analysis:
The judgment pertains to an appeal against the imposition of a penalty under section 273(1)(b) of the Income-tax Act. The assessee, an individual, had filed a return showing a loss for the assessment year 1979-80, but the assessment was made on an income figure due to additions made for inflation of purchases. As the assessee had not paid any advance tax, the Income-tax Officer sought an explanation for not filing a statement of estimate of income. The assessee argued that he could not anticipate the additions made in the assessment and had carried forward losses, which, if considered, did not necessitate the filing of an advance tax statement. However, the Income-tax Officer disagreed, stating that the assessee should have known the actual income reflected in the assessment and thus failed to comply with the advance tax filing requirement.
In the subsequent appeal, the assessee contended that the penalty under section 273(1)(b) was not applicable as the conditions under section 209A(1)(a) had not been met, despite the confirmed additions and penalty for income concealment under section 271(1)(c). Conversely, the revenue argued that since the assessee knew the actual income concealed, it implied a failure to pay legitimate advance tax. The Tribunal analyzed the provisions of section 273(1)(b) and section 209A(1)(a), which mandate filing advance tax statements if the current income exceeds specified amounts. The Tribunal noted that the assessee's latest assessments and subsequent returns reflected losses, indicating no liability for advance tax payment. The Tribunal emphasized that penalizing the assessee for not estimating income, which was not required by statute, was unjustifiable. While the assessee faced penalties for income concealment, the Tribunal ruled that the failure to file an advance tax statement, reflecting only losses, did not warrant penalty under section 273(1)(b). Consequently, the imposed penalty was revoked, and the appeal was allowed.
-
1992 (11) TMI 151
Issues:
Stay of recovery of disputed taxes for the assessment year 1989-90.
Analysis:
The assessee, a company, filed a return showing an income of Rs. 19,55,413 for the assessment year 1989-90, but the assessment determined the total income at Rs. 92,44,310, resulting in a demand of Rs. 62,62,670. The appeal was partly allowed, leaving the disputed tax amounting to Rs. 42,09,337, along with interest under sections 234B and 234C. The Income-tax Officer had already recovered a portion of the amount from the bank accounts of the assessee. The assessee requested a stay of collection due to financial constraints, but the Commissioner of Income-tax refused the request, leading to the petition for stay before the Tribunal.
The Tribunal considered the provisions of the Income Tax Act and emphasized the importance of fairness and balance in tax collection. It noted the disparity in interest rates between what the assessee had to pay and what the Revenue paid, highlighting the need for a reasonable approach in tax recovery. The Tribunal discussed the powers of the assessing officer and the Tax Recovery Officer to grant stay of recovery during pending appeals, emphasizing the need for fair treatment and proper consideration of the assessee's financial situation.
The Tribunal further addressed the role of the Commissioner of Income-tax in guiding the Income-tax Officer and the Tax Recovery Officer, stressing the importance of following principles of natural justice and making speaking orders when rejecting applications for stay. It clarified that the Commissioner's administrative powers still required adherence to fairness and natural justice principles, especially when interfering with judicial discretion.
Regarding the Tribunal's authority to direct the Commissioner of Income-tax in matters of stay, it explained that the Tribunal had the power to ensure a fair process and protect the rights of the appellant. Quoting relevant Supreme Court judgments, the Tribunal emphasized the need for a strong prima facie case to grant stay of recovery, highlighting the importance of balance of convenience, irreparable injury, and public interest in such decisions.
Ultimately, the Tribunal found the assessee's application for stay premature and advised the assessee to approach the Commissioner of Income-tax again. It directed the Commissioner to pass a speaking order, following the guidelines set by the Madras High Court in a previous case. The Tribunal dismissed the petition as premature, ensuring that the assessee would not be treated as in default until the Commissioner's decision was properly considered and communicated.
-
1992 (11) TMI 149
The Appellate Tribunal in Indore allowed the appeal of an assessee firm against the CIT(A) order for the assessment years 1985-86 and 1986-87. The Tribunal upheld the net profit rate of 12.5% applied by the tax authorities and allowed deductions under sections 80HH and 80-I for the relevant years. The appeals were partly allowed. (Case citation: 1992 (11) TMI 149 - ITAT INDORE)
-
1992 (11) TMI 148
Issues Involved:
1. Inordinate delay in communicating assessment orders.
2. Validity of assessment orders due to delayed communication.
3. Maintainability of the appeal filed by Poonamchand Toshniwal on behalf of the firm.
Issue-wise Detailed Analysis:
1. Inordinate Delay in Communicating Assessment Orders:
The assessee contended that the assessment orders for the years 1966-67, 1967-68, 1970-71, and 1971-72 were served after a delay of 14 to 17 years, rendering them unenforceable. The assessee's counsel cited decisions from the Andhra Pradesh High Court, specifically Khetmal Parekh & Co. vs. State of A.P. (1976) 38 STC 531 and M. Ramakrishnaiah & Co. vs. State of A.P. (1976) 38 STC 537, to support the argument that unreasonable delay in communicating orders makes them invalid.
2. Validity of Assessment Orders Due to Delayed Communication:
The Tribunal examined whether the delay in serving the assessment orders affected their validity. It was noted that the Andhra Pradesh High Court's decisions pertained to executive authorities, whereas the Income Tax Officer (ITO) acts as a quasi-judicial authority. The Tribunal relied on precedents under the Indian IT Act, 1922 and the IT Act, 1961, which held that delay in serving the assessment order does not invalidate it. The Tribunal cited the Mysore High Court decision in N. Subba Rao vs. Third ITO (1963) 48 ITR 808 (Mys) and the Calcutta High Court decision in CIT vs. Karnani Industrial Bank Ltd. (1978) 113 ITR 380 (Cal), which supported the view that there is no statutory limitation for issuing a notice of demand under Section 29 of the Indian IT Act, 1922. The Tribunal concluded that the delay in sending demand notices does not invalidate the assessment orders.
3. Maintainability of the Appeal Filed by Poonamchand Toshniwal on Behalf of the Firm:
The Departmental Representative challenged the maintainability of the appeals, arguing that Poonamchand Toshniwal was not a partner of the firm and thus lacked the authority to file the appeals. The Tribunal examined Section 140(cc) of the IT Act and Rule 45 of the IT Rules, which require that appeals be signed by the managing partner or, in their absence, by any partner not being a minor. The Tribunal also considered the argument that minors admitted to the benefits of partnership have a right to challenge assessments affecting their interests, and their guardian can file appeals on their behalf.
The Tribunal noted that Poonamchand Toshniwal had undertaken to pay the income-tax arrears on behalf of the partners as per the dissolution deed dated 20th January 1971. The Tribunal referred to the Calcutta High Court decision in CIT vs. Southern Bank Ltd. (1979) 120 ITR 92 (Cal), which held that a successor in interest could continue proceedings and file appeals. Applying this rationale, the Tribunal concluded that Poonamchand Toshniwal, having stepped into the shoes of the partners, was competent to file the appeals. The Tribunal distinguished the earlier Calcutta High Court decision in CEPT vs. Ramnath Bajoria (1951) 19 ITR 79 (Cal), which the Departmental Representative had relied upon, as not applicable to the present case.
Conclusion:
The Tribunal held that the delay in serving the assessment orders and demand notices does not invalidate the assessments. It also held that Poonamchand Toshniwal was entitled to file and maintain the appeals on behalf of the firm. However, on the merits, the Tribunal dismissed the appeals, concluding that the assessee had no case regarding the validity of the assessments due to delayed communication.
-
1992 (11) TMI 147
Issues Involved:
1. Legality of the withdrawal of depreciation on livestock.
2. Legality of the withdrawal of terminal allowance on livestock.
3. Jurisdiction and authority of the Deputy Commissioner in passing rectificatory orders.
4. Application of previous Tribunal decisions and principles of rectification under Section 154 of the Income-tax Act.
Detailed Analysis:
1. Legality of the Withdrawal of Depreciation on Livestock:
The primary issue in this appeal is whether the withdrawal of depreciation on livestock amounting to Rs. 2,47,032 by the Deputy Commissioner through his rectificatory order dated 19-3-1991 is legal and proper. Initially, the Income-tax Officer rejected the claim of depreciation on livestock, asserting that livestock cannot be considered as plants and that depreciation is only allowable on fixed assets, not on stock-in-trade. This decision was not contested by the assessee in the appeal before the Commissioner of Income-tax (Appeals). The Commissioner (Appeals) allowed investment allowance on parent stock, following an earlier Tribunal decision for the assessment year 1981-82, which considered parent birds as plants. Consequently, the Deputy Commissioner allowed depreciation in his first modificatory order dated 10-9-1990. However, this was later withdrawn in the second modificatory order dated 19-3-1991, stating that the Commissioner (Appeals) did not direct any such relief.
2. Legality of the Withdrawal of Terminal Allowance on Livestock:
The second issue is the withdrawal of terminal allowance on livestock amounting to Rs. 23,26,443. Similar to the depreciation issue, the terminal allowance was initially granted by the Deputy Commissioner in his first modificatory order dated 10-9-1990, but was later withdrawn in the second modificatory order dated 19-3-1991. The Deputy Commissioner justified this withdrawal by stating that the Commissioner (Appeals) did not direct any such relief in his appellate order.
3. Jurisdiction and Authority of the Deputy Commissioner in Passing Rectificatory Orders:
The Tribunal examined whether the Deputy Commissioner had the jurisdiction to pass the first modificatory order dated 10-9-1990, which granted depreciation and terminal allowance. The Tribunal referred to Section 154(1A) of the Income-tax Act, which allows rectification of matters not considered and decided by the appellate authority. Since the disallowance of depreciation and terminal allowance was not contested in the appeal before the Commissioner (Appeals), these matters remained within the jurisdiction of the Deputy Commissioner for rectification. The Tribunal also cited previous decisions, including the Karnataka High Court's ruling in Addl. CIT v. India Tin Industries (P.) Ltd., which supported the Deputy Commissioner's authority to rectify such matters.
4. Application of Previous Tribunal Decisions and Principles of Rectification under Section 154:
The Tribunal emphasized that the earlier decision of the Income-tax Appellate Tribunal in the assessee's own case for assessment years 1978-79, 1979-80, and 1980-81, which allowed depletion allowance, should have been followed. The Deputy Commissioner, realizing his mistake in the original assessment order, corrected it in the first modificatory order dated 10-9-1990. The Tribunal held that disregarding the Tribunal's earlier decision constituted a mistake apparent on the record, justifying rectification under Section 154(1). The Tribunal also referred to the Gujarat High Court's decision in Parshuram Pottery Works Co. Ltd. v. D.R. Trivedi, WTO, which supported rectification based on previous Tribunal decisions.
Conclusion:
The Tribunal concluded that the assessee should succeed in this appeal. It held that the Deputy Commissioner had the jurisdiction and authority to pass the first modificatory order dated 10-9-1990, granting depreciation and terminal allowance. The Tribunal found the second modificatory order dated 19-3-1991, which withdrew these allowances, to be illegal. Consequently, the Tribunal set aside the impugned orders of the Commissioner of Income-tax (Appeals) and the second modificatory order, restoring the first modificatory order. The appeal of the assessee was allowed.
-
1992 (11) TMI 146
Issues Involved:
1. Validity of assessment orders due to inordinate delay in communication.
2. Maintainability of the appeal filed by an unauthorized person.
Detailed Analysis:
Issue 1: Validity of Assessment Orders Due to Inordinate Delay in Communication
The primary contention raised by the assessee was that the assessment orders for the years 1966-67, 1967-68, 1970-71, and 1971-72 were communicated after an inordinate delay of 14 to 17 years, rendering them invalid and unenforceable. The assessee cited two decisions from the Andhra Pradesh High Court, namely Khetmal Parekh & Co. v. State of A.P. [1976] 38 STC 531 (AP) and M. Ramakrishnaiah & Co. v. State of A.P. [1976] 38 STC 537 (AP), to support their argument. However, these decisions were distinguished on the grounds that they pertained to the Andhra Pradesh General Sales Tax Act and were specific to executive authorities, not quasi-judicial authorities like the Income-tax Officer.
The Tribunal referenced multiple decisions under the Indian Income-tax Act, 1922 and 1961, which held that delays in serving assessment orders do not affect their validity. The Tribunal cited N. Subba Rao v. Third ITO [1963] 48 ITR 808 (Mysore High Court), which stated that the absence of a statutory limitation period for issuing a notice of demand under section 29 means that delays do not invalidate the assessment order. Similarly, the Calcutta High Court in CIT v. Kamani Industrial Bank Ltd. [1978] 113 ITR 380 held that there is no statutory limit for issuing a notice of demand, and delays do not invalidate the assessment.
The Tribunal found tangible evidence showing that assessment orders for the years 1966-67, 1970-71, and 1971-72 were dispatched to the assessee within a reasonable time. For the year 1967-68, although there was no evidence of timely service, the Tribunal held that delays do not invalidate the assessment order based on the cited legal precedents.
Issue 2: Maintainability of the Appeal Filed by an Unauthorized Person
The Departmental Representative challenged the maintainability of the appeals on the grounds that Shri Poonamchand Toshniwal, who filed the appeals, was not a partner in the firm and thus had no authority to file appeals on behalf of the assessee firm. According to section 140(cc) of the Income-tax Act and Rule 45(2)(cc) of the Income-tax Rules, an appeal for a firm must be signed by the managing partner or, in his absence, by any partner not being a minor.
The Tribunal examined whether a guardian of a minor partner could file an appeal. Shri Poonamchand Toshniwal argued that minors admitted to the benefits of a partnership have a right to challenge assessments affecting their interests, and their guardian could sign the appeal on their behalf. The Tribunal considered the Calcutta High Court decision in CIT v. Southern Bank Ltd. [1979] 120 ITR 92, which allowed a successor in interest to continue appeals.
Given that Shri Poonamchand Toshniwal had undertaken to pay the income-tax arrears on behalf of the minors and other partners as per the dissolution deed, the Tribunal concluded that he stepped into the shoes of the partners. Thus, he was competent to file the appeals. The Tribunal distinguished the Calcutta High Court decision in CEPT v. Ramnath Bajoria [1951] 19 ITR 79, which was relied upon by the Departmental Representative, as not applicable in this context.
Conclusion:
The Tribunal dismissed the appeals on merits, holding that the delay in serving the assessment orders and demand notices did not invalidate the assessments. However, it recognized the competence of Shri Poonamchand Toshniwal to file the appeals on behalf of the firm due to his obligations under the dissolution deed.
-
1992 (11) TMI 145
Issues Involved:
1. Validity of reopening under section 147(a).
2. Sustainability of the addition of Rs. 12,000 as perquisite derived by the assessee partner under section 28(iv).
3. Levy of interest under sections 215 and 139(8).
Detailed Analysis:
1. Validity of Reopening Under Section 147(a):
The appeals for assessment years 1974-75, 1976-77, and 1977-78 revolve around the validity of reopening under section 147(a). The assessee argued that section 147(a) is not applicable to debatable issues, citing the Kerala High Court decision in CIT v. C. L. Anand and other cases. The assessee contended that there was no omission or failure to disclose any income and that the perquisite value of free residence was not taxable in his hands, as supported by the Delhi High Court decision in CIT v. Rajinder Kumar Rajgarhia. The Tribunal, however, upheld the validity of reopening under section 147(a), referencing the Supreme Court decision in Indo-Aden Salt Mfg. & Trading Co. (P.) Ltd. v. CIT, which states that omission to disclose material facts, even if inadvertent, justifies reopening.
2. Sustainability of the Addition of Rs. 12,000 as Perquisite Under Section 28(iv):
The Income-tax Officer added Rs. 12,000 per year as the value of the perquisite for rent-free accommodation provided to the assessee by the firm. The Appellate Assistant Commissioner upheld this addition, following the Tribunal's earlier orders. The assessee argued that the building was treated as house property by the firm, and its income was already taxed in the firm's hands, making the addition of the perquisite value in the assessee's hands a case of double taxation. The Tribunal agreed with the assessee, referencing the Delhi High Court decision, and held that the perquisite value could not be added under section 28(iv) since it would result in double taxation. Therefore, the Tribunal deleted the addition of Rs. 12,000 for each assessment year.
3. Levy of Interest Under Sections 215 and 139(8):
The Tribunal addressed the common ground regarding the levy of interest under sections 215 and 139(8) in reassessment orders. Citing the High Court decision in CIT v. Padma Timber Depot, the Tribunal held that interest under these sections could not be imposed in reassessment orders as it is permissible only in regular assessments. Consequently, the levy of interest was deemed unauthorized, and the assessee succeeded on this point.
Separate Judgment for Assessment Year 1978-79:
For the assessment year 1978-79, the Income-tax Officer added Rs. 8,637 towards income from dividends. The Appellate Assistant Commissioner rejected the ground without providing detailed reasons. The Tribunal set aside this decision, directing the first appellate authority to reconsider the facts and provide a reasoned order according to law.
Conclusion:
The appeals for the assessment years 1974-75, 1976-77, and 1977-78 were allowed in full, with the Tribunal upholding the validity of reopening under section 147(a) but deleting the addition of Rs. 12,000 as perquisite under section 28(iv) and disallowing the levy of interest under sections 215 and 139(8). The appeal for the assessment year 1978-79 was allowed for statistical purposes, with a directive for the first appellate authority to re-evaluate the facts regarding the dividend income.
-
1992 (11) TMI 144
Issues:
1. Interpretation of proviso No. 1 to section 43B of the Income-tax Act.
2. Application of section 43B to an assessee maintaining accounts on a cash basis.
3. Disallowance of sales-tax payments under section 43B by the Income-tax Officer.
4. Rectification of assessment order by the Dy. Commissioner(Appeals).
5. Validity of the order of the Dy. Commissioner(Appeals) in allowing the appeal.
Detailed Analysis:
1. The main issue in this case is the interpretation of proviso No. 1 to section 43B of the Income-tax Act, introduced with effect from 1-4-1988. The question is whether this proviso applies to an assessee who maintains accounts on a cash basis and whether payments made outside the accounting year but before the time allowed for filing the income-tax return under section 139(1) can be claimed as a deduction under section 43B.
2. The assessee in this case maintained accounts on a cash basis and had made sales-tax payments outside the accounting year but before the deadline for filing the income-tax return. The Income-tax Officer disallowed these payments under section 43B, leading to a dispute that was taken to the Dy. Commissioner(Appeals) who allowed the appeal, stating that the disallowance was not justified under section 143(1)(a).
3. The Income-tax Officer's decision to disallow the sales-tax payments under section 43B was based on the argument that the assessee followed a cash system of accounting for sales-tax. However, the advocate for the assessee contended that proviso No. 1 to section 43B allows for the deduction of statutory liabilities irrespective of the method of accounting followed by the assessee.
4. The Dy. Commissioner(Appeals) held that the adjustments made by the Income-tax Officer were not in line with the provisions of section 143(1)(a) and ordered the deletion of the disallowed amount from the total income of the assessee. The Revenue then filed an appeal against this decision, leading to the present case.
5. The Tribunal analyzed the Finance Minister's speech introducing section 43B and the subsequent amendments, including Explanation 2 and proviso No. 1. It was held that these provisions confer a privilege on the assessee regardless of the method of accounting followed. The Tribunal found that the proviso applied to all assessees, including those maintaining accounts on a cash basis, and dismissed the Revenue's appeal.
6. In conclusion, the Tribunal upheld the decision of the Dy. Commissioner(Appeals) based on the application of proviso No. 1 to section 43B, which allows for the deduction of statutory liabilities irrespective of the method of accounting followed by the assessee. The judgment emphasizes the inclusive nature of section 43B and its provisions, ensuring that statutory liabilities are allowed as deductions based on actual payments made by the assessee.
-
1992 (11) TMI 143
Issues Involved:
1. Entitlement to interest under section 244(1A) of the Income-tax Act.
2. Validity of the Income-tax Officer's (ITO) order under section 154.
3. Commissioner's exercise of powers under section 263.
4. Applicability of section 244(1A) to taxes paid before 31-3-1975.
5. Jurisdiction of the Tribunal to consider new points not raised by the Commissioner.
Detailed Analysis:
1. Entitlement to Interest under Section 244(1A):
The assessee filed a petition under section 154 on 9-1-1986, seeking interest under section 244(1A) for excess tax paid. The original assessment raised a demand of Rs. 5,98,398, collected in full. This assessment was reopened, and a fresh assessment was made, leading to a refund claim with interest under section 244(1A). The ITO granted interest from the date of tax payment to the date of the fresh assessment order. The Tribunal found that the assessee was entitled to interest under section 244(1A) as the refund became due following the cancellation of the ex-parte assessment.
2. Validity of the ITO's Order under Section 154:
The ITO allowed the interest claim under section 154, which was contested by the Commissioner. The Tribunal held that the ITO's order was correct, as the failure to grant interest constituted a "mistake apparent from the record." The Tribunal emphasized that the provisions of section 244(1A) were mandatory and applicable to refunds due prior to 1-4-1989.
3. Commissioner's Exercise of Powers under Section 263:
The Commissioner scrutinized the ITO's order and concluded that granting interest was incorrect, thus invoking section 263 to withdraw the interest. The Tribunal ruled that the Commissioner was not justified in invoking section 263, as there was no error in the ITO's order, nor was there any prejudice to the interests of the Revenue. The Tribunal cited the decision of the Punjab and Haryana High Court in CIT v. Jagadhri Electric Supply & Industrial Co., emphasizing that the Tribunal cannot uphold the Commissioner's order on grounds not mentioned by the Commissioner.
4. Applicability of Section 244(1A) to Taxes Paid Before 31-3-1975:
The Departmental Representative argued that section 244(1A) applied only to amounts paid after 31-3-1975. The Tribunal found this argument factually incorrect, as some payments were made after 31-3-1975. The Tribunal noted that the Commissioner did not raise this point in his order, and thus, it could not be considered by the Tribunal. The Tribunal also referenced the Allahabad High Court's decision in Hari Nandan Agarwal (HUF) v. ITO, supporting the view that refunds due as a result of orders under section 146 are entitled to interest.
5. Jurisdiction of the Tribunal to Consider New Points:
The Tribunal reiterated that it could not consider new points not raised by the Commissioner in his order under section 263. This principle was supported by the Punjab and Haryana High Court's decision, which stated that the Tribunal must decide appeals based on the grounds mentioned by the Commissioner.
Conclusion:
The Tribunal concluded that the assessee was entitled to interest under section 244(1A) and that the ITO's order under section 154 was correct. The Commissioner's order withdrawing the interest was not justified. The Tribunal canceled the Commissioner's order and allowed the appeal, affirming the assessee's entitlement to interest on the refund.
-
1992 (11) TMI 142
Issues Involved:
1. Non-allowing of depreciation claim on commercial vehicles.
2. Observation that commercial vehicles were not put to use.
3. Lack of valid certificate of registration.
4. Insufficient evidence of actual use of commercial vehicles.
5. Lease agreement considered non-genuine.
Summary of Judgment:
1. Non-allowing of depreciation claim on commercial vehicles:
The appeal was filed by the assessee, a leasing company, aggrieved by the non-allowing of a claim of depreciation of Rs. 53,65,210 on commercial vehicles purchased by it. The assessee argued that it had purchased 54 DCM Toyota commercial vehicles, paid the total consideration, and received temporary registration and insurance for the vehicles. The vehicles were leased to M/s DCM Toyota Ltd., and the lease rental was credited to the P&L account.
2. Observation that commercial vehicles were not put to use:
The assessee contended that the vehicles were used for its business of leasing, satisfying the conditions u/s 32 of the IT Act, which requires the assets to be owned and used for business. The primary objection from the authorities was the lack of a public transport permit under the Motor Vehicles Act. The assessee argued that the permit was necessary for the sub-lessees, not for the leasing business itself.
3. Lack of valid certificate of registration:
The authorities argued that the temporary registration was insufficient. The assessee countered that temporary registration is normally issued by dealers to enable the purchaser to lift the vehicles and that the vehicles were insured and delivered to the assessee. The Tribunal found that the temporary registration and insurance were sufficient to establish ownership.
4. Insufficient evidence of actual use of commercial vehicles:
The Tribunal examined the lease agreement, invoices, insurance documents, and temporary registration certificates. It concluded that the vehicles were indeed leased out and used for the business of leasing, satisfying the requirement of use for business purposes u/s 32(1).
5. Lease agreement considered non-genuine:
The Tribunal found no evidence to support the authorities' claim that the lease agreement was non-genuine. The agreement was acted upon, and there was no retraction by DCM Toyota Ltd. The Tribunal held that the lease agreement was genuine and that the assessee was entitled to depreciation.
Conclusion:
The Tribunal concluded that the assessee satisfied the conditions u/s 32(1) for claiming depreciation, as the vehicles were owned and used for its business of leasing. The appeal was allowed, and the claim for depreciation on the 54 vehicles was justified.
-
1992 (11) TMI 141
Issues Involved:
1. Short allowance of depreciation on dredgers.
2. Technical know-how fees paid to M/s Thomas Broadbent and Sons Ltd., U.K.
3. Amount paid to M/s Joy Industrial Equipments Ltd., U.S.A.
4. Disallowance out of bonus paid to employees.
5. Disallowance of Rs. 10 lacs out of interest expenditure.
6. Disallowance of Rs. 9,99,564.
7. Addition of Rs. 1,45,338.
Detailed Analysis:
1. Short Allowance of Depreciation on Dredgers
The assessee claimed depreciation at 30% on dredgers, arguing they fell under the category of plant and machinery. The Assessing Officer allowed only 10%, considering the general rate for plant and machinery. The Commissioner (A) held that the dredger fell under the IVth category in Appendix I to Rule 5, applicable to ships, and was entitled to 10% depreciation. The Tribunal upheld the appellate order, agreeing with the Commissioner (A)'s interpretation.
2. Technical Know-How Fees Paid to M/s Thomas Broadbent and Sons Ltd., U.K.
The assessee entered into two agreements with the U.K. company for technical know-how and technical assistance. The payment of Rs. 2,25,000 under the know-how agreement was claimed as revenue expenditure, but the Assessing Officer treated it as capital expenditure. The Commissioner (A) agreed, citing Supreme Court decisions in Scientific Engineering House P. Ltd. vs. CIT and Elecon Engg. Co. Ltd., and held that the payment was for the acquisition of a capital asset. The Tribunal upheld this view, finding no reason to deviate from the principles laid down by the Supreme Court.
3. Amount Paid to M/s Joy Industrial Equipments Ltd., U.S.A.
The assessee had a collaboration agreement involving a lump sum payment for technical know-how and royalty for technical assistance. The Commissioner (A) held the payment as capital expenditure, but the Tribunal accepted the assessee's contention that the payment was of a revenue nature. The Tribunal noted that the principle of res judicata applied since the nature of the property acquired was already determined as revenue in an earlier assessment year. The Tribunal directed the Assessing Officer to allow the deduction as claimed by the assessee.
4. Disallowance Out of Bonus Paid to Employees
The Assessing Officer disallowed certain amounts paid as bonus, considering them excessive under the Bonus Act. The Commissioner (A) confirmed the disallowance for some units but allowed it for others. The Tribunal agreed with the assessee's contention that the payments were made for commercial expediency and industrial peace, and allowed the deductions except for the Mathura Unit, where the assessee failed to provide adequate evidence.
5. Disallowance of Rs. 10 Lacs Out of Interest Expenditure
The Assessing Officer disallowed Rs. 10 lacs of interest expenditure, attributing it to advances made to a subsidiary company. The Tribunal upheld the disallowance, noting that the funds were borrowed and advanced to the subsidiary, not for the assessee's own business. However, the Tribunal directed the Assessing Officer to calculate the disallowance based on the actual funds utilized for the advance, after verifying the details provided by the assessee.
6. Disallowance of Rs. 9,99,564
The assessee reversed earlier entries of commission payments to M/s Intech Engineers Pvt. Ltd. and later settled the dispute by agreeing to pay Rs. 9,99,564. The Commissioner (A) disallowed the amount, stating it did not pertain to the relevant assessment year and was capital in nature. The Tribunal disagreed, noting that the liability was contractually accepted in the current year and was not a capital expenditure. The Tribunal allowed the deduction, considering the settlement agreement as a resolution of a disputed liability.
7. Addition of Rs. 1,45,338
The amount was added to the assessee's income on a substantive basis while being protectively taxed in the subsidiary's assessment. The Tribunal agreed with the addition to the assessee's income but directed the Assessing Officer to delete the addition from the subsidiary's assessment.
Conclusion:
The Tribunal modified the appellate order to allow certain deductions and directed the Assessing Officer to make appropriate adjustments. The appeal was partly allowed.
-
1992 (11) TMI 140
Issues Involved:
1. Deduction u/s 80HHC.
2. Addition on account of designing charges.
3. Disallowance of commission paid to M/s Kamala Overseas.
4. Disallowance of car expenses and depreciation.
Summary:
1. Deduction u/s 80HHC:
The primary issue was whether the assessee could be denied deduction u/s 80HHC for failing to attach a certificate from an Accountant with the return of income, despite submitting it during the assessment proceedings. The Tribunal noted that the purpose of the certificate is to facilitate assessment and prevent inaccurate claims. The Tribunal held that the requirement to file the certificate along with the return is procedural. Since the certificate was available before the completion of the assessment, the assessee was eligible for the deduction. The Tribunal relied on the Supreme Court's decision in Mangalore Chemicals & Fertilizers Ltd. v. Dy. Commissioner, emphasizing that procedural conditions should be liberally construed.
2. Addition on account of designing charges:
The Assessing Officer (AO) had added Rs. 40,150 for designing charges, doubting the genuineness of the payments made in cash. The Tribunal found that while the vouchers raised suspicion, the AO had not conducted proper inquiries. The Tribunal remitted the matter back to the AO for fresh consideration, allowing the assessee to establish the genuineness of the payments and compliance with section 40A(3).
3. Disallowance of commission paid to M/s Kamala Overseas:
The AO disallowed the commission paid to M/s Kamala Overseas, questioning the justification and genuineness of the services rendered. The Tribunal noted that evidence supporting the claim was presented for the first time before the CIT(A) and not before the AO. The Tribunal remitted the issue back to the AO for fresh examination, considering the new evidence and giving the assessee a reasonable opportunity to be heard.
4. Disallowance of car expenses and depreciation:
The Tribunal upheld the disallowance of 1/5th of car expenses and depreciation for non-business purposes, finding the disallowance reasonable and declining to interfere.
Additional Note by Accountant Member:
The Accountant Member agreed on all issues but added a reference to section 12A(b) dealing with exemption u/s 11, which also requires a report from an Accountant to be furnished with the return of income. The Gujarat High Court and the Supreme Court had previously ruled in favor of the assessee in a similar context, which could be relevant if the revenue prefers a reference on this point.
-
1992 (11) TMI 139
Issues Involved:
1. Inclusion of Rs. 2,92,12,829 as income under section 41(1) of the Income-tax Act.
2. Validity of the liability reduction of Rs. 2,26,41,195 from Delhi Tambakoo Udyog Pvt. Ltd. (DTU).
3. Consideration of Rs. 65,71,630 as income under section 41(1) of the Act.
4. Applicability of section 41(1) to the appellant firm.
Detailed Analysis:
1. Inclusion of Rs. 2,92,12,829 as income under section 41(1) of the Income-tax Act:
The appellant firm contested the inclusion of Rs. 2,92,12,829 as income under section 41(1) of the Income-tax Act. The reduction in demand by the Provident Fund Commissioner included Rs. 2,26,41,195 from DTU and Rs. 65,71,630 from the appellant firm. The appellant argued that the liability taken over from DTU was never claimed as a deduction by the appellant firm and thus should not be treated as its income under section 41(1).
2. Validity of the liability reduction of Rs. 2,26,41,195 from DTU:
The appellant firm took over the bidi manufacturing business from DTU in 1981, including all assets and liabilities. The PF Commissioner determined the actual liability in 1991, reducing the liability by Rs. 2,26,41,195. The Tribunal upheld that the liability provided in the books of DTU was justified and in compliance with the PF Act. The Tribunal also noted that the transaction of giving over and taking over the business was genuine and not a sham.
3. Consideration of Rs. 65,71,630 as income under section 41(1) of the Act:
The appellant conceded that the claim regarding Rs. 65,71,630 had no merit. The Tribunal approved the inclusion of this amount as income under section 41(1) of the Act, as the liability no longer represented any actual liability due to cessation.
4. Applicability of section 41(1) to the appellant firm:
The Tribunal examined whether section 41(1) could be applied to the appellant firm for the liability reduction of Rs. 2,26,41,195. It was determined that the identity of the assessee who was allowed the deduction and the assessee who received the benefit must be the same. Since DTU and the appellant firm are distinct entities, section 41(1) could not be invoked for the liability reduction of Rs. 2,26,41,195 in the appellant firm's hands. The Tribunal referenced the Supreme Court's ruling in Saraswati Industrial Syndicate Ltd. v. CIT, which emphasized the necessity of the same identity for the application of section 41(1).
Conclusion:
The Tribunal concluded that the inclusion of Rs. 65,71,630 as income under section 41(1) was justified. However, the liability reduction of Rs. 2,26,41,195 from DTU could not be treated as income under section 41(1) in the appellant firm's hands, as the entities are distinct for tax purposes. The appeal was allowed in part.
-
1992 (11) TMI 138
Issues Involved:
1. Eligibility of cash compensatory support and income from the sale of import licenses for relief under sections 80HHA and 80-I of the IT Act.
2. Inclusion of duty drawback receipts in the profits of the industrial undertaking for deductions under sections 80HHA and 80-I.
3. Treatment of unabsorbed deductions for carrying over for adjustment in succeeding assessment years under section 80VVA.
4. Classification of cash compensatory support as a capital receipt and its taxability.
5. Disallowance of testing charges of the boiler.
6. Disallowance of 1/4th of expenditure on rent and taxes for personal use by directors.
7. Disallowance of damages for breach of contract.
8. Disallowance of foreign traveling expenses of directors.
9. Computation of relief under sections 80HHA and 80-I.
10. Simultaneous deductions under sections 80J and 80-I.
11. Restriction of total deduction to 70% of total income under section 80VVA.
12. Chargeability of interest under sections 217 and 139(8).
Detailed Analysis:
1. Eligibility of Cash Compensatory Support and Income from Sale of Import Licenses for Relief under Sections 80HHA and 80-I:
The Tribunal examined whether receipts from cash compensatory support (Rs. 3,34,739) and income from the sale of import licenses (Rs. 3,66,063) qualify as income derived from an industrial undertaking for deductions under sections 80HHA and 80-I. The Tribunal followed the Special Bench order in Gedore Tools India (P) Ltd. vs. IAC, which held that cash compensatory support is not trading receipts and thus not taxable under the IT Act. Similarly, profit from the sale of import licenses was deemed not to be derived directly from the industrial undertaking, following the Karnataka High Court's decision in Sterling Foods vs. CIT. Therefore, the Tribunal upheld the CIT(A)'s order denying relief under sections 80HHA and 80-I for these receipts.
2. Inclusion of Duty Drawback Receipts in Profits for Deductions under Sections 80HHA and 80-I:
The Tribunal upheld the CIT(A)'s order, which directed the AO to include duty drawback receipts in the profits of the industrial undertaking for deductions under sections 80HHA and 80-I. This decision was based on an earlier Tribunal order in the assessee's case for the assessment year 1982-83.
3. Treatment of Unabsorbed Deductions for Carrying Over for Adjustment under Section 80VVA:
The Tribunal noted that no argument was raised by the assessee on this point, and there was no evidence of unabsorbed deductions in the orders of the authorities below. Therefore, this ground was rejected.
4. Classification of Cash Compensatory Support as a Capital Receipt and its Taxability:
The Tribunal rejected the assessee's application to treat cash compensatory support as a capital receipt, noting the retrospective amendment of the IT Act by the Finance Act, 1990, which included such amounts in the definition of income under section 2(24). Consequently, the application for admission of the additional ground was also rejected on merits.
5. Disallowance of Testing Charges of Boiler:
The Tribunal agreed with the CIT(A) that the expenditure on testing the boiler was of a revenue nature and upheld the deletion of the disallowance made by the AO.
6. Disallowance of 1/4th Expenditure on Rent and Taxes for Personal Use by Directors:
The Tribunal upheld the CIT(A)'s order deleting the disallowance of Rs. 8,148, as there was no evidence of personal use of the premises by the directors, and the Revenue did not challenge the CIT(A)'s order for the earlier years.
7. Disallowance of Damages for Breach of Contract:
The Tribunal found that the liability for damages payable to M/s M.W. Hardy & Co. was contingent upon the approval of the Reserve Bank of India and the execution of orders by Hardy. Therefore, the Tribunal upheld the AO's disallowance of the entire amount of Rs. 7,93,793 and set aside the CIT(A)'s order on this point.
8. Disallowance of Foreign Traveling Expenses of Directors:
The Tribunal upheld the CIT(A)'s order deleting the disallowance of Rs. 12,944, as the AO did not provide any specific material to justify the disallowance, and the expenses were within the limits prescribed by the IT Rules and the Reserve Bank of India.
9. Computation of Relief under Sections 80HHA and 80-I:
The Tribunal reversed the CIT(A)'s order and upheld the AO's method of computing relief under sections 80HHA and 80-I by adjusting the loss in the head office set from the profit in the branch set and adjusting the unabsorbed loss of the preceding year.
10. Simultaneous Deductions under Sections 80J and 80-I:
The Tribunal agreed with the Revenue that both reliefs under sections 80J and 80-I are not simultaneously available. Since the assessee started production after 1st April 1981, relief under section 80-I was admissible. Therefore, the CIT(A)'s direction to grant relief under section 80J was set aside.
11. Restriction of Total Deduction to 70% of Total Income under Section 80VVA:
The Tribunal noted that the CIT(A) did not quantify the reliefs, and since relief under section 80J was denied, the restriction under section 80VVA would not arise. However, the AO was directed to restrict the relief within the limits prescribed by section 80VVA if applicable.
12. Chargeability of Interest under Sections 217 and 139(8):
The Tribunal upheld the CIT(A)'s order canceling the levy of interest under sections 217 and 139(8), as the ITNS-150 form used for calculating tax payable could not be equated with an order charging interest, and the ITO did not apply his mind to the facts and circumstances as required by the Act.
Separate Judgment by P.J. Goradia, A.M.:
P.J. Goradia, A.M., disagreed with the view that cash compensatory support and income from the sale of import entitlements should be excluded from eligible profits for deductions under sections 80HHA and 80-I. He argued that these receipts are part of the profits derived from the industrial undertaking, considering the legislative intent and the retrospective amendments made by the Finance Act, 1990. He emphasized that the business economics and principles of costing support the inclusion of such receipts in the eligible profits.
Reference to Third Member:
Due to the difference of opinion, the matter was referred to the Hon'ble President for a Third Member's opinion on whether the amounts received by the assessee as cash compensatory support and income from the sale of import entitlements could form part of eligible profits for deduction under sections 80HHA and 80-I.
Third Member's Opinion:
The Third Member, Ch. G. Krishnamurthy, President, concluded that the receipts from cash compensatory support and the sale of import entitlements should be included in the eligible profits for deductions under sections 80HHA and 80-I. He favored the view expressed by P.J. Goradia, A.M., and emphasized the legislative intent and the need to prefer the interpretation in favor of the assessee when there are divergent judicial opinions.
............
|
9911796707
