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Showing 201 to 220 of 1047 Records
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2011 (1) TMI 1396
Grant of Bail - offences under various provisions of the I.P.C., the Explosive Substances Act, and the Unlawful Activities (Prevention) Act - The prosecution case is that the respondent gave medical aid to one of the wounded accused in pursuance of a previous plan that if and when any of the assailants got injured in the attack on Prof. Jacob then immediate medical treatment would be given by the respondent to the injured - Held that: - the respondent has already spent 66 days in custody, and we see no reason why he should be denied bail. A doctor incarcerated for a long period may end up like Dr. Manette in Charles Dicken's novel `A Tale of Two Cities', who forgot his profession and even his name in the Bastille - appeal dismissed - decided against Revenue.
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2011 (1) TMI 1395
Issues involved: Appeal by revenue u/s 260A of Income Tax Act against ITAT order on accumulation of funds u/s 11(2) for assessment year 2006-07.
Summary:
1. The appeal was filed by the revenue against the ITAT order regarding the accumulation of funds by the assessee u/s 11(2) of the Income Tax Act, 1961. The primary question raised was whether the assessee fulfilled the mandatory requirements of Section 11(2) without specifically mentioning the definite purpose of accumulation in Form No.10.
2. The assessee, a statutory body under the Punjab Agriculture Produce Marketing Act, 1961, had funds accumulated without complying with Section 11(2) conditions. The CIT(A) deleted the addition made by the assessing officer, stating that the accumulation was in accordance with statutory provisions. The Tribunal upheld this view, emphasizing that the mentioning of development works in Form No.10 fulfilled the primary condition of Section 11(2).
3. The condition for excluding accumulated income of a charitable institution from total income requires specification of the purpose for accumulation and deposit in a specified mode. The exemption was disallowed initially due to the alleged failure to specify the purpose of accumulation. However, both the CIT(A) and the Tribunal confirmed that the purpose was specified for utilizing the amount, which was for development as per Section 28 of the PAPM Act.
4. The relevant portion of Section 11(2) of the Act was cited, highlighting the conditions to be complied with for accumulation of income for charitable purposes. The counsel for the revenue failed to demonstrate any error in the decisions of the CIT(A) and the Tribunal, leading to the dismissal of the appeal.
5. Ultimately, the appeal by the revenue was dismissed as no substantial question of law was found to arise from the case.
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2011 (1) TMI 1394
Issues Involved:
The judgment deals with the issue of renewal of registration of a trust under section 80G of the Income Tax Act, challenged by the Revenue based on the amount of expenditure incurred towards religious activities being less than 5% of the total income.
Summary:
The respondent, a society registered for religious and charitable purposes, sought renewal of registration under section 80G in 2009, which was refused by the Revenue. The Tribunal, after considering the income and expenditure accounts, found that the expenditure towards religious activities was less than 5% of the total income for two consecutive years. Consequently, the Tribunal allowed the appeal and directed the grant of exemption under section 80G to the assessee. The Revenue appealed against this decision.
The Revenue argued that the plea regarding expenditure for religious purposes being less than 5% was raised for the first time before the appellate authority, requesting a remand for further investigation. On the other hand, the assessee contended that the plea was raised before the CIT, and the appellate authority was justified in considering it based on the records provided. The appellate authority's finding was factual and not disputed, hence no fresh inquiry was warranted.
The High Court observed that the society was registered under the Societies Registration Act for religious and charitable activities, holding registration under sections 12AA and 80G. The CIT's refusal to renew registration based on religious activities alone was found to be without merit, as the expenditure towards religious activities was below 5% of the total income, entitling the trust to benefits under section 80G. The Tribunal's decision was based on undisputed records and did not warrant interference. Consequently, the High Court dismissed the appeal, upholding the Tribunal's order.
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2011 (1) TMI 1393
Issues involved:
The judgment deals with the appeal against the order passed by the Learned CIT under section 263 of the Act, relating to the assessment year 2007-08, regarding the exemption granted to the assessee under section 10(10C) of the Act on the Ex-gratia amount received.
Summary:
The assessee challenged the direction given by the Learned CIT to revoke the exemption granted under section 10(10C) of the Act on the Ex-gratia amount received. The assessee relied on a previous bench decision and argued that the Assessing Officer had accepted their claim for exemption initially. The Learned CIT directed the Assessing Officer to revoke the exemption granted, citing non-compliance with guidelines. The assessee argued that the assessment order was not erroneous as the Assessing Officer had fully verified the claim. The CBDT's letter post the assessment was also considered. The State Bank of India had modified the scheme, fulfilling the conditions mentioned by the Learned CIT. The Departmental Representative contended that the scheme did not comply with rule 2BA and the Assessing Officer had not properly applied the provisions. The legal position under section 263 was discussed, emphasizing the need for the order to be erroneous and prejudicial to the interests of the Revenue. The Tribunal found that the Assessing Officer had taken a plausible view based on available information and set aside the order of the Learned CIT.
Judgment:
The Tribunal found that the Assessing Officer's decision was reasonable and in accordance with the law. The subsequent letter from CBDT was issued after the assessment order, and the Assessing Officer had compared the facts with a relevant decision before allowing the exemption. The Tribunal concluded that the initiation of proceedings under section 263 was not justified, and hence, the orders of the Learned CIT were set aside. The appeal of the assessee was allowed based on the consistency with a previous decision.
Separate Judgment:
No separate judgment was delivered by the judges in this case.
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2011 (1) TMI 1392
Issues involved: Validity of initiation of revision proceedings u/s 263 of the Income Tax Act regarding exemption u/s 10(10C) and the bar of limitation.
Validity of initiation of revision proceedings u/s 263:
The appeal was filed by the assessee against the CIT's order questioning the initiation of revision proceedings u/s 263 of the Income Tax Act, specifically related to the allowance of claim u/s 10(10C). The assessee contended that the revision proceedings were time-barred as the issue had attained finality on the date of intimation u/s 143(1) of the Income Tax Act.
Judgment: The Tribunal referred to a similar case where the CIT's order was set aside under identical circumstances, emphasizing the need for the CIT's order to be considered "erroneous in so far as it is prejudicial to the interests of the Revenue." It was highlighted that the Assessing Officer's view must be plausible and sustainable in law, and in this case, the Assessing Officer had compared the facts with a relevant case and allowed the claim of the assessee. Therefore, the Tribunal concluded that the initiation of proceedings u/s 263 was not justified and set aside the CIT's order.
Bar of limitation:
The assessee challenged the initiation of revision proceedings on the ground of being time-barred, asserting that the issue had already attained finality on the date of intimation u/s 143(1) of the Income Tax Act.
Judgment: The Tribunal, after careful consideration, found that the initiation of revision proceedings was not warranted as the Assessing Officer had taken a plausible view based on existing facts and legal provisions. The Tribunal emphasized that the subsequent letter issued by CBDT could not be the basis for terming the assessment orders as erroneous and prejudicial to the revenue. Therefore, the Tribunal allowed the appeal of the assessee, setting aside the CIT's order u/s 263 of the Act.
In conclusion, the Tribunal ruled in favor of the assessee, setting aside the CIT's order u/s 263 of the Income Tax Act based on the grounds that the initiation of revision proceedings was not justified and the bar of limitation was not applicable in this case.
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2011 (1) TMI 1391
Issues Involved:
The issue involves the apportionment of Tax Deducted at Source (TDS) between members of a joint venture company based on a TDS certificate issued by the Assessing Officer.
Summary:
The appeal by the Revenue for assessment year 2006-07 was directed against the order of the CIT(A), Guntur dated 15.4.2010. The grounds of appeal raised by the Revenue questioned the apportionment of TDS between members of a joint venture company, contending that there is no provision in law for such apportionment. The Revenue argued that the direction of the CIT(A) to allow proportionate TDS to the assessee as a member of the joint venture company was erroneous in law.
The learned DR supported the Assessing Officer's decision, emphasizing that the TDS certificate was issued in the name of the joint venture company, and there is no legal provision for dividing the TDS amount among the members. On the other hand, the counsel for the assessee argued that since the assessee had claimed its 60% share in the TDS amount in the filed return of income, it was entitled to credit for 60% of the TDS amount. The counsel cited a previous decision by the Hyderabad Tribunal in favor of the assessee.
Upon careful consideration, it was noted that the assessee, a partnership firm engaged in civil contract works, had claimed credit for 60% of the TDS amount based on the TDS certificate issued by the joint venture company's Assessing Officer. The Tribunal found that as per section 199 of the Income-tax Act, 1961, the credit for TDS should be given to the person whose receipts are subject to tax. Therefore, the proportionate credit of the TDS amount should be allowed to individual constituents based on their respective share ratio in the joint venture agreement. Citing a previous decision in the assessee's favor for a different assessment year, the Tribunal confirmed the order of the CIT(A) and dismissed the Revenue's appeal.
In conclusion, the Tribunal dismissed the appeal of the Revenue, affirming the decision to allow the assessee credit for the TDS amount based on their share ratio in the joint venture agreement.
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2011 (1) TMI 1390
Grounds for declaring election to be void - Validity of election of the respondent No. 2, who is returned candidate from Legislative Assembly Constituency of Dibrugarh - seeking to order repoll in Polling Station No. 124 Manik Dutta L.P. School (Madhya) of 116 Dibrugarh Legislative Assembly Constituency - whether there had been or not a breach of the Act and the Rules in the conduct of the election at this constituency? - HELD THAT:- It is hardly necessary for this Court to go over the evidence with a view to ascertaining whether there was or was not a breach of the Act and the Rules in the conduct of the election concerned. Having read the evidence on record, this Court is in entire agreement with the decision of the learned Single Judge that by the change of venue of casting votes, breach of the provisions of Sections 25 and 56 of the Act read with Rule 15 of the Rules of 1961 was committed by the officials who were in charge of the conduct of the election at this constituency.
The matter is governed by Section 100(1)(d)(iv) of the Act. The question still remains whether the condition precedent to the avoidance of the election of the returned candidate which requires proof from the election petitioner, i.e., the appellant that the result of the election had been materially affected insofar as the returned candidate, i.e., the respondent No. 2, was concerned, has been established in this case - It is well to remember that this Court has laid down in several reported decisions that the election of a returned candidate should not normally be set aside unless there are cogent and convincing reasons. The success of a winning candidate at an election cannot be lightly interfered with. This is all the more so when the election of a successful candidate is sought to be set aside for no fault of his but of someone else. That is why the scheme of Section 100 of the Act, especially clause (d) of sub-Section (1) thereof clearly prescribes that in spite of the availability of grounds contemplated by sub-clauses (i) to (iv) of clause (d), the election of a returned candidate shall not be voided unless and until it is proved that the result of the election insofar as it concerns a returned candidate is materially affected.
The heads of substantive rights in Section 100(1) are laid down in two parts: the first dealing with situations in which the election must be declared void on proof of certain facts and the second in which the election can only be declared void if the result of the election, insofar as it concerns the returned candidate, can be held to be materially affected on proof of some other facts. The appellant has totally failed to prove that the election of the respondent No. 2, who is returned candidate, was materially affected because of non-compliance with the provisions of the Representation of the People Act, 1951, or Rules or Orders made under it.
This Court is of the firm opinion that the learned Single Judge of the High Court did not commit any error in dismissing the petition filed by the appellant challenging the election of the respondent No. 2. Therefore, the appeal, which lacks merits, deserves to be dismissed.
Appeal dismissed.
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2011 (1) TMI 1389
Issues Involved:
1. Validity of notice u/s 148.
2. Addition of Rs. 27,85,500/- u/s 68.
3. Addition of Rs. 41,782/- on account of commission.
4. Admission of additional evidence by CIT(A) in contravention of Rule 46A.
Summary:
1. Validity of notice u/s 148:
The assessee challenged the validity of the notice issued u/s 148. However, this ground became infructuous as the case was decided on merits in favor of the assessee.
2. Addition of Rs. 27,85,500/- u/s 68:
The AO added Rs. 27,85,500/- to the income of the assessee, alleging that the amount represented accommodation entries. The assessee provided details of share application money and sale proceeds of shares, including PAN, affidavits, and confirmations. The CIT(A) deleted the addition, holding that the assessee had discharged the onus of proving the identity, genuineness, and creditworthiness of the transactions. The Tribunal upheld this decision, noting that the AO did not conduct any independent enquiry and relied solely on the investigation wing's information.
3. Addition of Rs. 41,782/- on account of commission:
The AO added Rs. 41,782/- as commission paid for obtaining accommodation entries. Since the main addition of Rs. 27,85,500/- was deleted, the CIT(A) also deleted the commission addition, which was upheld by the Tribunal.
4. Admission of additional evidence by CIT(A) in contravention of Rule 46A:
The revenue argued that the CIT(A) admitted additional evidence without following Rule 46A. The Tribunal found that the evidence regarding the purchase of shares was requisitioned by the CIT(A) and was not additional evidence filed by the assessee. Therefore, the CIT(A) was within his rights to call for such evidence, and no contravention of Rule 46A occurred.
Conclusion:
The Tribunal dismissed the revenue's appeal and upheld the CIT(A)'s order, deleting the additions made by the AO. The cross-objection by the assessee regarding the validity of notice u/s 148 was dismissed as infructuous.
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2011 (1) TMI 1388
Issues Involved:
1. Deduction u/s 80IB(10) for non-owner developers.
2. Deduction u/s 80IB(10) on proceeds from the sale of unutilized FSI.
Summary:
Issue 1: Deduction u/s 80IB(10) for non-owner developers
The Revenue contended that the assessee was not entitled to deduction u/s 80IB(10) as the assessee was not the owner of the land and the approval for the housing project was not in the assessee's name but in the name of the original landowner. The CIT(A) allowed the deduction, referencing the ITAT Ahmedabad decision in the case of M/s. Radhe Developers & Others, which held that ownership of land is not a prerequisite for claiming deduction u/s 80IB(10). The ITAT affirmed this view, stating that the deduction is available to the entity developing and building the housing project, irrespective of land ownership.
Issue 2: Deduction u/s 80IB(10) on proceeds from the sale of unutilized FSI
The Revenue argued that the profit from the sale of unutilized FSI should not qualify for deduction u/s 80IB(10) as it is not derived from the development and construction of housing projects. The CIT(A) rejected this argument, again referencing the ITAT Ahmedabad decision in M/s. Radhe Developers & Others, which clarified that there is no mandatory requirement to fully utilize permissible FSI for claiming deduction u/s 80IB(10). The ITAT upheld this view, noting that the sale of unutilized FSI does not disqualify the profits from being considered as derived from the housing project.
Conclusion:
The ITAT confirmed the CIT(A)'s order allowing the deduction u/s 80IB(10) to the assessee, both for the development of the housing project and the proceeds from the sale of unutilized FSI. The appeal of the Revenue was dismissed.
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2011 (1) TMI 1387
Issues Involved:
1. Legality of the reassessment under Section 153A of the Income Tax Act.
2. Validity of the addition made as undisclosed investment under Section 69.
3. Justification of the reference made to the Valuation Officer.
4. Reliance on the Valuation Officer's report and objections raised by the assessee.
Detailed Analysis:
1. Legality of the Reassessment under Section 153A:
The assessee challenged the reassessment framed under Section 153A, arguing that it was done without complying with the statutory requirements and procedures. However, no arguments were presented before the Tribunal on this ground, leading to its rejection.
2. Validity of the Addition Made as Undisclosed Investment under Section 69:
The assessee contended that the addition of Rs. 3,89,409/- as undisclosed investment in the purchase of property was made without any material or evidence indicating any investment over the amount stated in the sale deed. The Tribunal noted that the Assessing Officer (AO) did not record any finding that the investment was not fully disclosed in the books of account, which is a prerequisite under Section 69. Therefore, the reference to the Valuation Officer and the subsequent addition based solely on the Valuation Officer's report were deemed unsustainable.
3. Justification of the Reference Made to the Valuation Officer:
The Tribunal examined Section 142A, which allows the AO to refer to the Valuation Officer for an estimate of the value of any investment. However, this can only be done if there is evidence that the investment was not fully disclosed in the books of account. In this case, the AO did not have any such evidence. The Tribunal cited various precedents, including "M/s. Rajeshwar Nath Gupta, HUF" and "CIT v. Gulshan Kumar," to support its conclusion that the reference to the Valuation Officer was invalid.
4. Reliance on the Valuation Officer's Report and Objections Raised by the Assessee:
The Tribunal found that the AO and the Commissioner of Income Tax (Appeals) [CIT(A)] had not adequately addressed the objections raised by the assessee against the Valuation Officer's report. The objections included issues like the property being under adverse possession, discrepancies in the valuation date, and the use of inappropriate comparable properties. The Tribunal emphasized that the valuation report alone could not form the basis for the addition, especially when the primary condition of Section 69B was not met. The Tribunal also noted that the comparable case used by the Valuation Officer was not apt, as it involved a property sold by the Delhi Development Authority in an open auction, which was not comparable to the assessee's property.
Conclusion:
The Tribunal concluded that the AO's reference to the Valuation Officer and the subsequent addition based on the valuation report were not justified. The Tribunal allowed the assessee's appeals in part, setting aside the additions made by the AO and upheld by the CIT(A). The department's appeal was dismissed. The Tribunal emphasized the importance of having concrete evidence before making additions based on valuation reports and reiterated that valuation discrepancies alone could not justify such additions.
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2011 (1) TMI 1386
The judgment by Appellate Tribunal CESTAT CHENNAI in 2011 dismissed the appeal of the assessee due to the absence of clearance from the Committee on Disputes. The assessee, a Government of Karnataka undertaking, was given the liberty to apply for restoration if the clearance is obtained.
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2011 (1) TMI 1385
Issues involved: Appeal against orders of CIT(A) for respective assessment years, disallowance under sec.36(1)(viia) for Asst. year 1993-94, bad debt write off and disallowance under sec. 14A for Asst. year 2006-07.
For Asst. year 1993-94: The only ground raised by the assessee was regarding disallowance made under sec.36(1)(viia). The Committee on Disputes had declined permission for the assessee to pursue this issue before the Tribunal, leading to the dismissal of the appeal.
For Asst. year 2006-07: The first issue was regarding bad debt write off, which the Committee on Disputes had also declined permission for the assessee to pursue. The second issue was the disallowance of `24,27,875/- under sec. 14A. The AO had relied on Rule 8D and the decision of a Special Bench, but the assessee argued against the application of Rule 8D for earlier years. Various judicial decisions were cited, leading to the Tribunal's decision that the matter needed to be revisited by the AO based on the principles discussed.
Summary of Judgement: The Tribunal dismissed the appeal for Asst. year 1993-94 due to lack of permission to pursue the issue. For Asst. year 2006-07, the Tribunal allowed the second ground of the assessee regarding the disallowance under sec. 14A for statistical purposes. The Tribunal emphasized the need for the AO to reconsider the matter based on various judicial decisions and evidence to be produced by the assessee, ensuring a fair assessment of the disallowance under sec. 14A.
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2011 (1) TMI 1384
Issues involved:
The judgment involves issues related to the assessment order passed by the Ld Assessing Officer pursuant to the directions of the Ld DRP, jurisdictional error in the reference made by the Ld Assessing Officer u/s 92CA(1) of the Act, addition of income to the appellant, violation of principles of natural justice, initiation of penalty u/s 271(1)(c) of the Act, and the sustainability of the order of DRP.
Assessment Order and DRP Directions:
The appeal was against the order of Dispute Resolution Panel (DRP), New Delhi dated 30.8.2010 passed u/s 144C of the Income Tax Act, 1961. The grounds raised by the assessee challenged the assessment order passed by the Ld Assessing Officer, jurisdictional errors in the reference made by the Ld Assessing Officer u/s 92CA(1) of the Act, and the addition of income to the appellant. The Ld DRP and Ld Assessing Officer were alleged to have erred in various aspects related to the arm's length principle, TP documentation, selection of comparables, working capital adjustment, and risk adjustment. The appellant contended that the principles of natural justice were violated, and judicial pronouncements were disregarded in undertaking the TP adjustment.
Sustainability of DRP Order:
The assessee raised objections against the cryptic and non-speaking order of the DRP, which did not consider the arguments presented by the assessee in detail. The DRP's order was compared to previous tribunal decisions emphasizing the importance of providing cogent and germane reasons in quasi-judicial orders. The Tribunal found that the DRP had not adequately considered the assessee's arguments, leading to the decision to remit the matter back to the DRP for a proper, speaking, and reasoned order u/s 144C of the Income Tax Act, 1961. The judgment highlighted the necessity for quasi-judicial authorities to provide detailed reasons for their decisions to facilitate proper review.
Conclusion:
The Tribunal allowed the appeal of the assessee for statistical purposes, remitting the matter back to the DRP for a fresh decision considering all arguments of the assessee. The judgment emphasized the importance of providing detailed and reasoned orders by quasi-judicial authorities to ensure fairness and proper review processes.
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2011 (1) TMI 1383
Estimation of the income from trucks plying business (as per Section 44AE) - Non-acceptance of revised return of income furnished by the appellant - Disallowance made out of diesel expenses - Disallowance made out of truck repairing expenses - Disallowance of made out of the tyre expenses - Addition in respect of so called vehicle rent received from Dashrathbhai K. Chaudhary - HELD THAT:- It is not in dispute that the assessee was plying the goods carriage which were four. Therefore, the number of goods carriages plied by the assessee was well within the ambit of the section 44AE. The AO has rejected the book result and has estimated the income by making various disallowance out of the expenses claimed by the assessee. He also enhanced the receipt shown by the assessee. The estimated disallowance made by the AO were partly reduced by the CIT(A). Therefore, undisputedly, in the assessee’s case, the actual dispute is only with regard to estimation of the income from trucks plying business.
When the Legislature has provided some formula for estimation of income in the case of a transporter, who owns less than ten goods carriages, there would not be any justification for not estimating the income of the assessee as per the formula prescribed in section 44AE. It is irrelevant whether the revised return furnished by the assessee is valid or not. When the question of estimation of the income of a transporter comes, Section 44AE is a good guideline in the case of transporter who owns less than ten goods carriage.
The AO is directed to determine the income of the assessee as per the section 44AE of the IT Act - appeal of assessee allowed.
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2011 (1) TMI 1380
Issues Involved:
1. Disallowance u/s 14A.
2. Disallowance of allocated regional overheads.
3. Disallowance of software expenses.
4. Disallowance of advertisement expenses.
5. Deletion of disallowance of rent paid towards sharing of garden space.
Summary:
1. Disallowance u/s 14A:
The issue pertains to the disallowance of Rs. 13,45,013/- u/s 14A. The Assessing Officer (AO) disallowed 10% of the dividend income, citing necessary expenditure for managing investments. The CIT(A) directed the AO to verify the claim as per Rule 8D. The Tribunal, referencing the Hon'ble Jurisdictional High Court's judgment in Godrej & Boyce Mfg. Co. Ltd. vs. DCIT, set aside the orders and remanded the matter to the AO for fresh determination following the High Court's directions.
2. Disallowance of Allocated Regional Overheads:
The AO disallowed Rs. 23,39,857/- due to lack of supporting evidence for expenses debited as allocated regional overheads. The CIT(A) confirmed this disallowance. The Tribunal upheld the disallowance, referencing its earlier decision in the assessee's own case, allowing the assessee to take remedial action in the subsequent year if the same amount was offered for taxation.
3. Disallowance of Software Expenses:
The AO disallowed Rs. 9,46,032/- on software expenses, treating them as capital in nature. Both parties agreed that the issue is covered by the Special Bench decision in Amway India Enterprises vs. Dy. CIT. The Tribunal set aside the orders and remanded the matter to the AO to decide afresh in light of the Special Bench's criteria, allowing due depreciation if deemed capital expenditure.
4. Disallowance of Advertisement Expenses:
The AO disallowed Rs. 10,49,722/- out of Rs. 1,35,35,020/- claimed as advertisement expenses, citing non-business purposes. The CIT(A) confirmed the disallowance. The Tribunal, following its earlier decision in the assessee's case for AY 2003-04, set aside the issue to the AO for fresh verification and decision.
5. Deletion of Disallowance of Rent Paid Towards Sharing of Garden Space:
The AO disallowed Rs. 38,56,963/- paid for garden space, considering it a diversion of income. The CIT(A) deleted the disallowance, following the Tribunal's earlier orders in the assessee's case. The Tribunal upheld the CIT(A)'s order, referencing consistent Tribunal decisions and the Special Bench's decision in JCIT vs. ITC Ltd.
Assessment Year 2005-06:
The issues of disallowance of regional overhead expenses Rs. 24,17,890/-, software expenses Rs. 21,07,024/-, and advertisement expenses Rs. 5.00 lacs were similar to AY 2004-05. The Tribunal confirmed the disallowance of regional overhead expenses and remanded the software and advertisement expenses issues to the AO for fresh decision.
Conclusion:
The assessee's appeals for AY 2004-05 and 2005-06 were partly allowed for statistical purposes, and the revenue's appeal for AY 2004-05 was dismissed.
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2011 (1) TMI 1379
Issues Involved: Appeal against order of ld. CIT(A) for A.Y. 2008-09 regarding exemption claim u/s 10(10C) of Income Tax Act, 1961 for ex-gratia payment received under voluntary retirement scheme.
Summary:
The appellant, a Deputy Manager at State Bank of India, took voluntary retirement and received an ex-gratia payment. The AO disallowed the claim of exemption u/s 10(10C) of the Act, stating that the scheme did not comply with the rule. The ld. CIT(A) upheld the AO's decision, leading to the appeal.
The appellant argued that a similar case decided by ITAT Kolkata Bench favored the assessee's claim for exemption u/s 10(10C). In that case, an employee of Standard Chartered Bank received compensation under an Early Separation Plan and was allowed the exemption despite the employer's objection. The Tribunal held that the provisions of sec. 10(10C) should be interpreted in favor of the optee for Voluntary Retirement.
After considering the submissions, the Tribunal found no justification in rejecting the appellant's claim based on the employer's statement about non-compliance with the rule. Citing the Kolkata Bench decision, the Tribunal held that the ld. CIT(A) wrongly rejected the claim, and the addition made by the AO was deleted, allowing the appeal.
In conclusion, the appeal filed by the assessee was allowed, and the order was pronounced in the Open Court on 14.1.11.
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2011 (1) TMI 1378
Issues Involved:
1. Legality of the addition of Rs. 13,91,520/- as unexplained investment in jewellery.
2. Validity of the CIT(A)'s decision to delete the addition to the extent of 1255.700 grams of jewellery.
3. Justification for the CIT(A)'s restriction on the explained jewellery to 500 grams per lady.
4. Denial of benefit for jewellery claimed to belong to the assessee's aunt and minor children.
Summary:
Issue 1: Legality of the addition of Rs. 13,91,520/- as unexplained investment in jewellery.
The Assessing Officer (AO) added Rs. 13,91,520/- to the income of the assessee as unexplained investment in jewellery found during a search and seizure action u/s 132(1). The jewellery was found in a locker held by the assessee, and the assessee initially admitted it as undisclosed income. However, the assessee later retracted the statement, claiming the jewellery belonged to multiple family members.
Issue 2: Validity of the CIT(A)'s decision to delete the addition to the extent of 1255.700 grams of jewellery.
The CIT(A) deleted the addition to the extent of 1255.700 grams, noting that the AO relied solely on the initial statement of the assessee without considering the retraction and supporting affidavits. The CIT(A) held that no addition could be made merely on the basis of a retracted statement without corroborative evidence.
Issue 3: Justification for the CIT(A)'s restriction on the explained jewellery to 500 grams per lady.
The CIT(A) allowed credit for 500 grams of jewellery per married lady and 255.700 grams for the elder sister, based on CBDT Instruction No. 1916. The CIT(A) found contradictions in the assessee's statements regarding the ownership of the jewellery but concluded that the jewellery could be considered to belong to the three ladies only.
Issue 4: Denial of benefit for jewellery claimed to belong to the assessee's aunt and minor children.
The CIT(A) denied the benefit for jewellery claimed to belong to the assessee's aunt and minor children, considering it an afterthought as no such claim was made during the investigation. The Tribunal upheld this decision, finding no credible evidence to support the claim.
Conclusion:
The Tribunal dismissed both the revenue's and the assessee's appeals, upholding the CIT(A)'s decision to delete the addition to the extent of 1255.700 grams of jewellery and denying the benefit for jewellery claimed to belong to the assessee's aunt and minor children. The Tribunal relied on CBDT Instruction No. 1916 and the lack of corroborative evidence for the retracted statement.
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2011 (1) TMI 1377
transactions of purchase and sale of shares - nature of trade - HELD THAT:- we are of the view that if the principles laid down by the Tribunal in the case of Sarnath Infrastructure Ltd.[2007 (12) TMI 261 - ITAT LUCKNOW-B] as well as the guidelines issued by the CBDT are applied to the facts of the present case, it clearly emerges that the transactions of purchase and sale of shares entered into by the assessee were in the nature of trade and the ld. CIT(A) was not justified in treating the said transactions as made by the assessee in the capacity of investor and trader merely on the basis of holding period. In that view of the matter, we set aside the impugned order of the ld. CIT(A) on this issue and restore that of the A.O. Ground No. (i) & (ii) of the Revenue’s appeal is accordingly allowed whereas ground No. 1 & 2 of the assessee’s appeal are dismissed.
claim for deduction on account of donations and rebate for STT - income from share transactions - business income - HELD THAT:- Since we have already held that the entire profit arising from transactions of shares is chargeable to tax in the hands of the assessee under the head ‘profits and gains of business/profession’, we direct the A.O. to allow consequential relief to the assessee on account of donations and STT paid after necessary verification. Ground No. 3 of the assessee’s appeal is accordingly treated as allowed.
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2011 (1) TMI 1376
The Delhi High Court dismissed the appeal regarding the allowance of depreciation at a higher rate of 60% on computer accessories and peripherals, citing a previous judgment in favor of the assessee.
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2011 (1) TMI 1375
Allowability of deduction u/s 80-IA - Carry forward of losses relating to the industrial undertaking which are already absorbed against other income - brought forward against the profit of the current year while allowing the deduction u/s 80-IA - HELD THAT:- The issue relating to computation of s. 80-IA deduction that it has to be computed after deduction of the notional brought forward losses and depreciation of business even though they have been allowed set off against other income in earlier years has been dealt by the Special Bench in the case of ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE - 4, AHMEDABAD. VERSUS GOLDMINE SHARES AND FINANCE (P.) LIMITED. [2008 (4) TMI 405 - ITAT AHMEDABAD] and decided the issue against the assessee. While delivering this order, the Special Bench considered all the arguments what the assessee has placed in the instant case - The Tribunal also considered the judgment in the case of COMMISSIONER OF INCOME-TAX VERSUS MEWAR OIL AND GENERAL MILLS LTD. [2003 (10) TMI 12 - RAJASTHAN HIGH COURT] and observed that this case has not noticed the non obstante provisions of s. 80-I(6)/80-IA(5) and, therefore, there is no discussion on this point in that decision. It would similarly, therefore, be not of any help to present case.
The judgment of Special Bench in the case of Goldmine Shares & Finance (P) Ltd. is squarely applicable to the facts of the present case and applying the ratio laid down by this order of the Special Bench of this Tribunal, the issue is decided against the assessee relating to allowability of deduction under s. 80-IA that in terms of provisions of under s. 80-IA(5) of the IT Act, the profit from the eligible business for the purpose of determination of the quantum of deduction under s. 80-IA of the Act has to be computed after deduction of the notional brought forward losses and depreciation of eligible business even though they have been allowed set off against other income in earlier years.
Revision u/s 263 - Jurisdiction/power of CIT to invoke the provisions of s. 263 when the original assessment was completed u/s 143(3) of the Act and all the relevant informations at the point of s. 80-IA are furnished before the AO - HELD THAT:- The prejudicial to the interest of Revenue appearing s. 263 is conjunction with the expression ‘erroneous’ and that every loss of revenue as a consequence of an order of the AO cannot prejudice to the interest of Revenue. In case, where the AO adopts one of the courses permissible in law where two views are plausible the CIT cannot exercise his power under s. 263 to defer with the AO even if there has been a loss of revenue. On the other hand, when the AO takes a view which is patently unsustainable, the CIT can exercise his powers where the loss of revenue results as a consequence of the view taken by the AO. It is also clear that while passing the order under s. 263, the CIT has to examine not only the assessment order but also the entire facts on the record. Further, when a regular assessment is made it has to be presumed that it has been passed upon proper application of mind when he has made proper enquiry before passing assessment order. The ITO is not only the adjudicator but also an investigator.
In the facts of the present case, the AO has not applied his mind to the provisions of s. 80-IA(5). No additional facts were necessary before the AO to come to the conclusion that deduction under s. 80-IA is wrongly computed. The AO not examined the facts before him. The order passed by the AO is very cryptic. There is no discussion or methodology of computation of deduction under s. 80-IA. It cannot be said that the AO is aware of any of the Tribunal orders on the issues involved. The order of the AO is erroneous for want of proper enquiry. He has not recorded reasons for accepting the return of the assessee as submitted by it on the impugned issue. The AO without making any enquiry accepted the claim of the assessee without recording any reasons at all. The assessment order is silent about the issue raised by the CIT - In this case, the failure of the AO to make an enquiry with regard to the claim of the assessee and to record such a reason, why he is taking particular view, makes the assessment order erroneous and prejudicial to the interest of the Revenue. As such, there is no merit in the arguments of the assessee’s counsel against observation made by CIT in his order under s. 263.
Appeal dismissed.
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