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Case Laws
Showing 121 to 140 of 189 Records
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1979 (2) TMI 69 - BOMBAY HIGH COURT
Capital Expenditure, Cinema Theatre, Enduring Nature, Expenditure On Repair, Revenue Expenditure
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1979 (2) TMI 68 - BOMBAY HIGH COURT
Remuneration Paid To Managing Director ... ... ... ... ..... dram to advance loans, he should have sent for the income-tax assessment file of the said Newandram. According to the learned counsel, in the context of the circumstances, the statement of Newandram should have been fully accepted because there was nothing to show that he was not speaking the truth. Mr. Dastur seriously contested the inference drawn by the income-tax authorities that the said amount of Rs. 2,500 represented undisclosed income of the assessee. After having argued on the second question for some time, Mr. Dastur, however, stated that having regard to the smallness of the amount involved, the assessee does not require the court to answer the reference in respect of the second question. It is not, therefore, necessary for us to consider the arguments advanced on behalf of the assessee. In the view which we have taken, the answer to the first question is in the negative and against the revenue. The second question is not answered. Parties to bear their own costs.
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1979 (2) TMI 67 - ALLAHABAD HIGH COURT
Original Assessment ... ... ... ... ..... sed that power. The Tribunal has held that there was no occasion for the ITO to exercise the discretion of waiver or reduction of interest. The error was of a clerical nature. It cannot, hence, be said that in the circumstances the officer had waived or reduced the interest payable by the assessee. In our opinion, this finding of fact is not vitiated by any error of law. In A. H. Wheeler and Co. P. Ltd. v. ITO 1964 51 ITR 92 (All), it was held that even assuming that the omission to reduce the super-tax rebate was deliberate, if that view was manifestly wrong in law, the ITO had jurisdiction to rectify the assessment. This shows that even if such a mistake was deliberate, since the interest was chargeable according to the statutory provisions, it could be rectified. In the result, we answer the question referred to us in the affirmative, in favour of the department and against the assessee. The Commissioner of Income-tax will be entitled to costs, which we assess at Rs. 200.
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1979 (2) TMI 66 - GUJARAT HIGH COURT
Charitable Trust, Nature Of Income ... ... ... ... ..... 12. It may be pointed out that, in this particular case of the Allahabad High Court, leave to appeal to the Supreme Court appears to have been rejected and, ultimately, as noted at page 287 of Volume I of the seventh edition of Kanga and Palkhivalas book on The Law and Practice of Income-tax, the application for special leave was rejected by the Supreme Court on October 28, 1975. Therefore, the decision of the Allahabad High Court has now become final so far as this particular aspect of the law is concerned. The view which the Allahabad High Court took is the same as the view which we take but the process of reasoning which has appealed to us is slightly from a different angle from the reasoning which appealed to the learned judges of the Allahabad High Court. Under these circumstances, the question preferred to us is answered in the affirmative, that is, in favour of the assessee and against the revenue. The Commisioner will pay the costs of this reference to the assessee.
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1979 (2) TMI 65 - ANDHRA PRADESH HIGH COURT
A Partner, Industrial Undertaking, Wealth Tax, Writ Petition ... ... ... ... ..... of the four is an independent category by itself. Therefore, we have no hesitation in repelling this contention advanced by the revenue. Learned revenue s counsel also contends that since the petitioner did not raise the question either before the assessing officer or before the AAC, he is estopped from raising this contention now. We cannot accept this. This was raised in the revision before the Commissioner under s. 25 and the Commissioner has considered this contention on its merits. It is not for the first time that the petitioner raises it in the writ petition. Further, there cannot be an estoppel of this nature. The above discussion shows that the groundnut oil mill in which the petitioner has an interest of the value of Rs. 1,08,757 is an industrial undertaking and to the extent of the said amount, he is entitled to exemption. The writ petition is, accordingly, allowed. Since, there is no direct decision on this question, we direct the parties to bear their own costs.
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1979 (2) TMI 64 - MADRAS HIGH COURT
Cash Credits, Original Assessment, Question Of Fact, Question Of Law, Reference To High Court, Undisclosed Income
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1979 (2) TMI 63 - BOMBAY HIGH COURT
Adventure In The Nature Of Trade, Business Income, Capital Gains, Purchase And Sale ... ... ... ... ..... ible for us to uphold the submission that the Tribunal was in error either in its approach to the problem or the answers that it gave to the questions which arose for consideration. We are inclined on these facts to agree with the Tribunal and the officers below that the plots were purchased not for any alleged construction, but for the purpose of making profit by resale if possible. If that were so and the activity is held to be an activity in the nature of trade, then the Tribunal s conclusion as well as the computation would be required to be upheld. In our opinion, further elaboration is unnecessary on the facts arising in this reference. In the result, the questions referred to us are answered as follows Question No. 1.---In the affirmative and in favour of the revenue. Question No. 2.---In the affirmative and in favour of the revenue. Question No. 3.---In the affirmative and in favour of the revenue. The assessee will pay to the Commissioner the costs of the reference.
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1979 (2) TMI 62 - MADHYA PRADESH HIGH COURT
Assessment Year, Law Applicable ... ... ... ... ..... Bench of the Andhra Pradesh High Court in CWT v. V. R. Desai 1977 108 ITR 787 held In the ultimate analysis, we hold that the non-filing of the return on 30th June of the corresponding assessment year is a completed default and not a continuing default and what all clause (i) of section 18(1) as amended by the Wealth-tax (Amendment) Act, 1964, and by section 24 of the Finance Act, 1969, provides is for the scale of penalty that should be levied for every month during which the return was not filed. It is, therefore, clear that when the assessee committed a default in filing the return on the due date, i.e., 30th June of every year 1961, 1962 and 1963, the law for the purpose of penalty that would be applicable will be the law in force on those dates and not one which has been brought into force on 1st April, 1969. Consequently, our answer to the two questions referred to us is in the affirmative. In the circumstances of the case, parties are directed to bear their own costs.
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1979 (2) TMI 61 - BOMBAY HIGH COURT
Levy Of Penalty, Penalty Proceedings ... ... ... ... ..... But the question raised in effect is whether the penalty in the instant case could be sustained. It is well known that in proceedings for penalty for concealment of income, the burden was always on the revenue to prove concealment and that a finding reached in the quantum appeal that a particular amount was liable to be added as income of the assessee did not automatically result in an order of penalty. With this well established position of law, it is difficult for us to accept the argument that the question referred by the Tribunal was intended to put in issue a contrary proposition. In our view, the Tribunal has found as a fact that the assessee did not receive Rs. 20,000 at all. On that finding, no charge of concealment could possibly arise. The Tribunal was, therefore, justified in setting aside the order of penalty. The question referred to us must, therefore, be answered in the affirmative and in favour of the assessee. The revenue to pay the costs of this reference.
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1979 (2) TMI 60 - BOMBAY HIGH COURT
Substantially Interested, Tax On Undistributed Income ... ... ... ... ..... o assessment year 1965-66 be regulated in the light of the above clarification. Steps may also be taken to withdraw reference applications/appeals filed on this issue and pending at different stages. When this circular was brought to the notice of Mr. Joshi, it was not possible for him to dispute that in view of this circular and the decision of the Kerala High Court, the answer to the question referred would have to be in favour of the assessee. He, however, expressed his inability to withdraw the reference. The three companies which held more than 50 of the shares of the assessee-company were companies in which the public were substantially interested. Consequently, the assessee-company will be a company to which the provisions of s. 23A of the Indian I.T. Act, 1922, or s. 104 of the I.T. Act, 1961, will not apply. The question referred to us will, therefore, have to be answered in the negative and in favour of the assessee. The assessee to get the costs of this reference.
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1979 (2) TMI 59 - BOMBAY HIGH COURT
Loss In Speculative Transaction, Set Off, Speculative Transactions ... ... ... ... ..... r the purchase or sale of any commodity, including stocks and shares, is periodically or ultimately settled otherwise than by the actual delivery or transfer of the commodity or scrips. Corresponding provision in the I.T. Act, 1922, was Expln. 2 to s. 24, which has been construed by the Supreme Court in Davenport and Co. P. Ltd. v. CIT (1975) 100 ITR 715. The Supreme Court has pointed out in that case that a transaction which is otherwise speculative would not be a speculative transaction within the meaning of Expln. 2, if actual delivery of the commodity or the scrips has taken place. In view of the decision in Davenport and Company s case 1975 100 ITR 715 (SC), the transaction in question in which the assessee has earned profit could not be said to be a speculative transaction as contemplated by s. 43(5) of the I.T. Act, 1961. Consequently, the question referred to us must be answered in the negative and against the assessee. The assessee to pay the costs of this reference.
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1979 (2) TMI 58 - BOMBAY HIGH COURT
Business Income, Carrying On Business, Income From Other Sources, Interest Income ... ... ... ... ..... rrying on any activity of advancing its idle funds, but in fact had advanced its funds collected by way of deposits from sub-distributors and from the bank overdraft to Sifco Ltd., in whose manufacturing activities the assessee was vitally interested. Once the nature of that interest is realised, it has to be held that the advances were made out of commercial considerations and for commercial reasons. Once the close link up between the advances and the agreement is established, the interest earned will have to be regarded as business income although there may be no stipulation in the agreement compelling the assessee to make any advances to Sifco Ltd. In the result, we fully agree with the Tribunal and the question referred to us is answered as follows On the facts and in the circumstances of the case, the interest income of Rs. 63,485 was assessable as business income and not as income from other sources. The Commissioner will pay to the assessee the costs of this reference.
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1979 (2) TMI 57 - BOMBAY HIGH COURT
Capital Asset, Capital Expenditure, Expenditure Incurred, Income Tax Act, Revenue Expenditure
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1979 (2) TMI 56 - MADRAS HIGH COURT
Business Expenditure, Capital Expenditure, Foreign Company, Income Tax Act, Purchase Price ... ... ... ... ..... e under s. 10(2)(xv). The Supreme Court held that no capital had been borrowed by the assessee and that the agreement, to pay the balance of consideration due by the purchaser did not in truth give raise to a loan. Therefore, the amount was held not to be admissible under s. 10(2)(iii). It was, however, held that the interest paid was liable to be allowed as deduction under s. 10(2)(xv) and for coming to this conclusion the Supreme Court held that the nature of the payment was interest and, therefore, was liable to be allowed as deduction. The two amounts under consideration are not in the nature of interest payments due in respect of any amount either (a) borrowed for the purpose of purchasing the machinery or (b) any unpaid instalment. Therefore, the said decision would have no application to the facts of the present case. In the result, the question is answered in the negative and against the assessee. The Commissioner will be entitled to his costs. Counsel s fee Rs. 500.
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1979 (2) TMI 55 - PATNA HIGH COURT
Capital Of Company, Foreign Company, Foreign Income, Standard Deduction, Super Profits Tax ... ... ... ... ..... cannot be treated as a reserve for the purpose of computing the capital of the company in accordance with the Second Schedule to the S. P. T. Act. Having regard to the discussions made above, question No. 1 in Tax Case No. 54 of 1974 is answered in the affirmative and against the assessee. Question No. 2 is answered in this way that whereas the provision for dividend is not a reserve for the purpose of computing the capital of the company in accordance with the Second Schedule to the S. P. T. Act, 1963, the amount set apart as provision for federal, foreign and State income-tax, is such a reserve. This question is, therefore, answered in part in the affirmative and against the assessee and in part in the negative and in favour of the assessee. The question referred in the department s reference, namely, Tax Case No. 55 of 1974, is answered in the affirmative and against the department. There will be no order as to costs in either of the references. S. SARWAR ALI J.--I agree.
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1979 (2) TMI 54 - BOMBAY HIGH COURT
Annual Value, Income From House Property, Income Tax Act ... ... ... ... ..... oretical or fictional income since the owner residing in the property does not receive any money income as such. If any reduction or relief in calculation of such income is provided by the legislature, it would appear to us that where the legislature has provided a special method of computing such income of property jointly held, a reduction or relief also should be available to all such co-owners if they are in self-occupation of the property. It would be an error to read the relief or reduction under s. 23(2) in the narrow way in which Mr. Joshi wants us to read the same. In this view of the matter, we would hold that the AAC and the Tribunal were right in coming to the conclusion that relief under s. 23(2) was available to the assessee although he was only a co-owner of the property in question having one-third share therein. Accordingly, the question referred to us is answered in the affirmative and in favour of the assessee. There will, however, be no order as to costs.
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1979 (2) TMI 53 - ALLAHABAD HIGH COURT
Accounting Year, Financial Year, Income Tax Act, Partnership Firm, Previous Year ... ... ... ... ..... this form even before the Tribunal. No such objection was taken before the AAC. Moreover, we are not satisfied that there is any substance in this objection. The appeal was filed on the basis that the ITO has framed the assessment on the basis of a concession given by the assessee s counsel wrongly on a question of law. This objection was entertained and accepted. This was a case where the assessee was an aggrieved person. Another difficulty in accepting this submission is that no question on the finding of the Tribunal rejecting the preliminary objection of the revenue has been referred to us at the instance of the revenue. We, therefore, answer the questions referred to us as follows Questions Nos. 1 and 2. In the negative, in favour of the assessee and against the department. Question No. 3. In view of our answer to the first two questions, this question has become academic and is returned unanswered. The assessee would be entitled to costs which are assessed at Rs. 200.
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1979 (2) TMI 52 - MADRAS HIGH COURT
Trust For The Benefit, Wealth Tax Act ... ... ... ... ..... levant valuation dates, the respondent and his wife had a right to be maintained out of the income of the trust properties, and they also had a right of residence in the house situate in that property and the sons had a right to be maintained and educated, the shares of the beneficiaries were found to be indeterminate and the trustees had to be assessed under s. 21(4). The decision proceeded on the construction of the particular document in the light of the factual situation that existed in that case. There is nothing in that decision which runs contrary to what we have expressed earlier, as flowing from the construction of the document before us. On the construction of the document, we answer the question in the negative, in the sense that the trustees of the estate should be assessed under s. 21(1) and not under s. 21(4) of the W.T. Act in accordance with the share of each individual beneficiary. The assessee will be entitled to his costs. Counsel s fee Rs. 500 in one set.
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1979 (2) TMI 51 - MADRAS HIGH COURT
Business Expenditure, Income Tax Act, Revenue Expenditure ... ... ... ... ..... for ever. The position here is wholly different, and we do not find any analogy between the matter before us and this decision of the Supreme Court. The expenditure incurred for the purchase of the machinery was undoubtedly capital expenditure, for it brought in an asset of enduring advantage. But the guarantee commission stands on a different footing. By itself, it does not bring into existence any asset of an enduring nature nor did it bring in any other advantage of an enduring benefit. The acquisition of the machinery on instalment terms was only a business exigency. If interest paid on a credit purchase of machinery could be held to be revenue expenditure, we fail to see how guarantee commission paid to a bank for obtaining easy terms for acquisition of the machinery could be regarded as capital payments. The result is that the question referred is answered in the negative and in favour of the assessee. The assessee will be entitled to its costs. Counsel s fee Rs. 500.
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1979 (2) TMI 50 - MADRAS HIGH COURT
Income Tax Act, Levy Of Penalty, Penalty For Concealment ... ... ... ... ..... ave the effect of wiping out the concealment. Cases of bona fide mistake rectified by the submission of a revised return would stand on a different footing. The present case would stand on a par with the case where the assessee came forward with the revised return showing income which was concealed earlier. If penalty could be levied on a charge of concealment of income from the original return after a revised return was filed, there is no reason why penalty should not be levied when a person made an oral admission and stopped short of submitting a revised return. That is also the view of the Bombay High Court in Western Automobiles (India) v. CIT 1978 112 ITR 1048 as already seen from the passage already extracted from page 1056. In these circumstances, we consider that the Tribunal was wrong in cancelling the penalty. The questions referred are accordingly answered in the negative and in favour of the revenue. The revenue will be entitled to its costs. Counsel s fee Rs.500.
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