|
Advanced Search Options
Case Laws
Showing 201 to 220 of 935 Records
-
2013 (6) TMI 742
Issues involved: Appeal against order allowing deduction u/s 10BA for income from DEPB and DDB.
Issue 1 - Deduction u/s 10BA: The Department appealed against the CIT(A)'s decision to allow deduction u/s 10BA for income from DEPB and DDB. The Assessing Officer disallowed the deduction, citing it was not derived from business. The assessee argued that DEPB and duty draw back are part of business income as per Section 28 of the Act and should be allowed for exemption u/s 10BA. The CIT(A) allowed the claim based on a decision by ITAT Jodhpur bench, stating that DEPB and DDB are part of eligible profit derived u/s 10BA.
Issue 2 - Legal Interpretation: The Department contended that the CIT(A) erred in not following decisions of the Hon'ble Supreme Court and in equating provisions of section 10BA with section 80IA. The CIT(A) justified the decision by referring to the ITAT Jodhpur bench's ruling and the applicability of section 28 of the Act to consider DEPB and DDB as business income eligible for deduction u/s 10BA.
Decision: The ITAT Jodhpur bench dismissed the Revenue's appeal, upholding the CIT(A)'s order allowing the deduction u/s 10BA for income from DEPB and DDB. The decision was based on the interpretation of relevant legal provisions and precedents, including the applicability of section 28 of the Act. The appeal was concluded on 26-06-2013.
-
2013 (6) TMI 741
Issues involved: Cross appeals by Revenue and assessee regarding assessment year 2008-09 under section 143(3) of the Income-tax Act, 1961.
Revenue's Appeal:
1. Cash Payments for Land Purchase: Revenue challenges allowance of cash payments of Rs. 3,93,00,000 for land purchase under Rule 6DD. Commissioner deleted this addition citing exclusion under Rule 6DD(g) and upheld by ITAT based on a similar decision for the previous year.
2. Disallowance of Land Development Expenses: Revenue contests deletion of Rs. 9,84,19,432 disallowance by CIT(A). ITAT upholds CIT(A)'s decision based on previous ruling for the assessment year 2007-08.
3. Non-Compliance with Rule 46A: Revenue alleges CIT(A) did not follow Rule 46A while disposing of the appeal. ITAT finds no merit in this argument as all details were provided to the Assessing Officer earlier.
Assessee's Appeal:
1. Disallowance under Section 40A(3): Assessee challenges the disallowance of Rs. 10,25,77,251 under section 40A(3) by the Assessing Officer. ITAT finds the CIT(A)'s confirmation of disallowance to be lacking in examination of expenditure components and Rule 6DD applicability. The issue is remitted back to the Assessing Officer for fresh examination.
2. Interest Levy under Sections 234B and 234C: Assessee disputes the levy of interest under these sections. ITAT deems this ground as rhetorical and rejects it.
In conclusion, the Revenue's appeal is dismissed, and the assessee's appeal is partly allowed. The judgment was pronounced on June 21, 2013, at Chennai.
-
2013 (6) TMI 740
Disallowance made under section 40(a)(ia) - Held that:- In this case and in respect of other payments another issue to be looked into is whether these payments are contractual payments or instant/adhoc payments against various services obtained. As no details are available on record, the issue of disallowance under section 40(a)(ia) is remitted back to the Assessing Officer for considering the issue afresh in the light of the relevant decisions. Wherever the payments were made without deducting any tax, where TDS is liable, then of course the Assessing Officer shall invoke the provisions of section 40(a)(ia). But, in cases even if no TDS was made if the payments do not come within the purview of TDS, no disallowance can be made. Likewise, in the case of shortfall in deduction, again there cannot be any disallowance. Accordingly, this issue is remitted back to the Assessing Officer for reconsideration and deciding the issue in accordance with law.
Development expenses - Held that:- Commissioner of Income-tax(Appeals) is justified in deleting the addition made by the Assessing Officer. The addition has been made by the Assessing Officer on general observations and on adhoc basis. He has not applied his mind in analyzing the real working pattern of the assessee and the profit rate disclosed by the assessee and he has not made any comparative study.
Disallowance under section 40A(3) - Held that:- Usually the land owners will not expect cheque or banking instruments as part of consideration and they insist that money should be paid before signing the documents before the Sub-Registrar. An assessee cannot swim against that inevitable practice in a particular line of transaction. It is not possible for the assessee to purchase land from the villagers by giving cheques and drafts when the villagers are insisting for cash payments. Therefore, it is to be seen that it is only in such circumstances where the assessee could not make payment through banking instruments that it had made the payments in cash and that was for reasons beyond its control. Rule 6DD applies in such circumstances. Where it is impossible to purchase land otherwise than by making cash, it is not proper to say that the situation is not covered by Rule 6DD.In the facts and circumstances of the case we delete the disallowance confirmed by the Commissioner of Income-tax(Appeals). The addition is accordingly deleted.
-
2013 (6) TMI 739
Income from suppressed sales has to be considered in the hands of Shri Jagadamba Pearl Dealers.
Estimation of income - Held that:- Comparative income offered to tax to various dealers in this line of business at Monalisa Pearls average @3.61%, Mansarovar Pearls (India) Pvt Ltd , average @ 1.25% Spectrum Pearls, average @ 0.16%.
Gifts received by the appellant - Held that:- We direct the Assessing Officer to delete the addition placing reliance on the judgment of the Hon’ble Supreme Court in the case of CIT vs. K. Mohanakala [2007 (5) TMI 192 - SUPREME Court ] wherein the Supreme Court has held that “in case where the explanation offered by the assessee about the nature and source of the sums found credited in the books is not satisfactory there is, primafacie, evidence against the assessee, viz. the receipt of money. The burden is on the assessee to rebut the same, and, if he fails to rebut it, it can be held against the assessee that it was a receipt of an income nature.
Allowance of interest paid by the partner - Addition u/section 14A - Held that:- It is noticed that deduction was claimed in respect of interest paid by partner on the capital withdrawn by the assessee for the purpose of investment in another firm. Interest paid to the partner must necessarily be added in the computation of his total business income. There is no provision made in the Act for deduction of interest paid by the partner to the firm. Hence, interest adjusted on the debit balance of the account of the partners in the books of a firm is not deductible while computing the income of the assessee. Interest paid on the debit balance of capital account by partner not for business purpose, cannot be allowed as business expenditure, though, interest income received from firm treated as business income. Further, we make it clear that in view of the judgment of jurisdictional High Court in the case of CIT Vs. T.V. Ramanaiah & Sons (1984 (10) TMI 20 - ANDHRA PRADESH High Court) wherein it was held that interest paid by the partner should be adjusted against the interest credited to the partners in the firm, if any. Accordingly, we direct the AO if there is any interest receipt and interest payment by the assessee to the same firm, to the extent it should be set off and not to be disallowed. Accordingly, this ground is partly allowed and also to that extent, the orders of the lower authorities have been modified.
Unaccounted cash - Held that:- We remit this issue to the file of Assessing Officer to verify whether the cash balance has been recorded in the books of Sri Jagadamba Pearl Dealers and if so the Assessing Officer cannot add it in the hands of Ravinder Kumar. This ground is allowed for statistical purposes.
Unaccounted jewellery - Held that:- We gave a finding at para No. 23 to 26 that the income generated from unaccounted sales has to be assessed in the hands of the affirm. Being so, we are of the opinion that the gold jewelry found in the hands of the assessee Shri Ravinder Kumar has to be considered as it is acquired by him out of the drawings from unaccounted income from suppressed sales in the firm. Therefore, in the interest of justice due telescoping to be given otherwise it amounts to double addition viz., once in the firm on account of unaccounted income and another in the firm on account of unaccounted assets found during the course of search. Being so, we allow this ground of appeal
Determination of income - undisclosed turnover - Held that:- The average G.P. for these years from 2004-05 to 2009-10 worked out at 28.05%. As reasonable expenditure was given in the block period at 4%, in our opinion, it is reasonable to allow the expenditure out of the estimated gross profit at 8.05% considering the inflation theory. Accordingly, out of estimated gross profit rate of 28.05%, we direct the AO to give deduction at 8.05% towards further undisclosed expenditure and limit the undisclosed income at 20% of the undisclosed turnover and determine the income accordingly. This ground raised by the assessee in its appeals is partly allowed.
Additions on the basis of planted documents - Held that:- No addition can be made solely on the basis of the seized unwritten note book/loose slips, which are dumb documents and the same were disowned by the assessee and there being no other corroborative material to show that the transaction reflected in seized loose slips actually belong to the assessee. Accordingly, deletion of addition by the CIT(A) is justified.
-
2013 (6) TMI 738
Issues involved: Application under section 5 of the Limitation Act to condone delay in Tax Appeal against judgment by Gujarat Value Added Tax Tribunal.
Summary:
The present application under section 5 of the Limitation Act was filed by the State of Gujarat to condone the delay of 807 days in preferring the Tax Appeal against the judgment and order passed by the Gujarat Value Added Tax Tribunal. The issue involved in the appeal is whether the assessee's activity of "pest control" as per works order issued by the contractee falls under the provisions of the Act, and whether the assessee is liable to pay tax on property transferred in execution of the "pest control" works contract. The delay was explained by the Assistant Government Pleader, emphasizing the significant tax liability involved. The delay was opposed by the advocate for the assessee, citing lack of explanation for part of the delay.
The High Court noted that the issue involved is a pure question of law with significant tax implications. It was deemed essential to provide the applicant an opportunity to present the case on merits rather than dismissing it on technical grounds of delay. The Court considered the explanation provided for the delay, including additional affidavits, as sufficient. Referring to a Supreme Court decision, the Court emphasized the importance of the case due to its potential revenue effect and the permanent impact of the tribunal's judgment. Therefore, the Court allowed the application, condoning the delay on the condition that the applicant pays costs of Rs. 10,000 to the opponent by a specified date.
In conclusion, the High Court allowed the application to condone the delay in preferring the appeal, emphasizing the importance of providing the applicant an opportunity to present the case on its merits.
-
2013 (6) TMI 737
Validity of proceeding initiated under section 147 - assessee declaring Nil income after claiming deduction under section 80IA - Held that:- Held that:- Remit the mater back to the file of Assessing Officer who shall examine the issue afresh after considering the contract document as a whole and all other evidence that may be submitted by the assessee to demonstrate the fact that the assessee has actually developed the infrastructure facilities by undertaking the activities of design, development, engineering, construction, maintenance, financial involvement, defect correction of the contract during the warranty period. If the assessee will be able to establish such facts by supporting evidence, then, the assessee would be entitled to the deduction under section 80IA(4) of the Act. With the aforesaid observations, we set aside the Order of the CIT(A) and direct the Assessing Officer to decide the issue afresh by keeping in view of our observations made hereinabove.
-
2013 (6) TMI 736
Exemption u/s 11 - Held that:- On perusal of trust deed, it is noticed that there is no clause in the trust deed imposing legal obligation on the assessee-trust or its members to hold income of the assessee-trust only for charitable purpose. There is no clause in the trust deed by which the element of private gain is excluded. Similarly, there is no clause in the trust-deed to show that the profits would not be divided or distributed among the members at any time or at the time of dissolution. In the absence of such a clause, it is difficult to treat the assessee-trust as a charitable trust because it is possible for the members of the trust, upon its dissolution, to divide the remaining funds among trustees.
In view of the foregoing, it is considered appropriate to set aside the order passed by the Ld Commissioner of Income-tax and restore the matter to his file so that reasonable time is made available to the assessee-trust to amend the trust deed and also enable the Commissioner of Income-tax to take a reasonable view in the matter in conformity with law. The assessee-trust can amend the trust deed within a period of three months from the date of receipt of this order failing which the Commissioner shall be free to pass such order as he considers appropriate in the matter.
-
2013 (6) TMI 735
Issues involved: Appeal against the order of the Commissioner of Income Tax (Appeals) for the assessment year 2007-08 challenging disallowance u/s 40(a)(ia) of the Income Tax Act, 1961.
Summary:
1. The appellant challenged the order of the Commissioner of Income Tax (Appeals) alleging it was bad in law and factually incorrect.
2. The dispute revolved around the disallowance u/s 40(a)(ia) of the Act amounting to Rs. 1,28,00,000 paid to a consolidator for transfer of rights, with a contention that TDS deduction was not required.
3. The appellant argued that the consolidator was not an agent but acting on a principal-to-principal basis, similar to a previous case where the Tribunal ruled in favor of the assessee.
4. The Assessing Officer treated the difference in land acquisition costs as commission to the consolidator and disallowed the amount due to lack of TDS deduction by the assessee.
5. The Tribunal found similarities with a previous case where the Tribunal had deleted a similar addition made by the Assessing Officer, based on the nature of the transactions and the absence of TDS deduction.
6. The Tribunal noted that the consolidator was to procure a minimum of 27 acres of land for the assessee, failing which no payment was due, and since no sales were made, no disallowance was warranted.
7. Relying on the previous ruling and the identical nature of the transactions, the Tribunal allowed the appeal of the assessee, emphasizing the principal-to-principal relationship and lack of TDS requirement.
Judges: SMT. DIVA SINGH, JUDICIAL MEMBER and SHRI T. S. KAPOOR, ACCOUNTANT MEMBER.
-
2013 (6) TMI 734
Tax Appeal is admitted on the following substantial questions of law:-
"(B) Whether the Tribunal is right in law and on facts in reversing the order passed by the CIT(A) and thereby deleting the disallowance of ₹ 5,00,000/- in respect of depreciation on multimodal project, Ambaji?
(C) Whether the Tribunal is right in law and on facts in confirming the order passed by the CIT(A) in restricting the addition on account of prior period expenses to ₹ 43,81,470/- and granting relief of ₹ 1,09,89,354/-?"
-
2013 (6) TMI 733
Issues:
Claiming depreciation as an application of income for exemption under Section 11 of the Income-tax Act, 1961.
Analysis:
The Revenue filed an appeal against the CIT(Appeals) decision allowing the assessee to claim depreciation as an application of income for exemption under Section 11 of the Act. The Assessing Officer initially disallowed the claim, citing a previous decision of the Hon'ble Apex Court in the case of Escorts Ltd. v. Union of India. The assessee's successful appeal before CIT(Appeals) was based on the Tribunal's decision in the case of Coimbatore Stock Exchange Ltd., where a similar claim was allowed for assessment years 2005-06 and 2006-07. The Revenue contested this citing that the Department had not accepted the Tribunal's decision for earlier years and had appealed before the jurisdictional High Court.
The Tribunal examined whether depreciation could be considered as an application of income for exemption under Sections 11 and 12 of the Act. Referring to previous decisions, the Tribunal noted that depreciation could indeed be claimed as an application of income for computing eligible exemption under Sections 11 and 12. The Tribunal cited various High Court decisions supporting the allowance of depreciation for charitable trusts, emphasizing that depreciation on trust assets should be deducted to calculate income for charitable purposes. The Tribunal rejected the Revenue's reliance on the Escorts Ltd. case, stating that it dealt with deductions under 'business income,' whereas depreciation for charitable trusts is a deduction to arrive at income, and capital expenditure is an application of such income.
The Tribunal concluded that the CIT(Appeals) was justified in allowing the assessee's claim for depreciation as part of income utilization, and no interference was necessary. The appeal of the Revenue was dismissed, affirming the decision in favor of the assessee. The order was pronounced on June 6, 2013, in Chennai.
-
2013 (6) TMI 732
Issues:
1. Allowance of provision for leave salary as deduction under section 43B(f) of the Income Tax Act, 1961.
Analysis:
The appeal filed by the revenue was directed against the order passed by the Ld. CIT(A)-4, Mumbai for the assessment year 2007-08. The grounds of appeal challenged the CIT(A)'s decision to allow relief to the assessee regarding the provision for leave salary. The AO had added a sum under section 43B of the IT Act on account of leave encashment, out of which a net addition was made after partial allowance. The CIT(A) relied on the decision of ITAT in a previous case to grant relief to the assessee. The revenue contended that the provision for leave salary was not allowable as a deduction under section 43B(f) of the IT Act, emphasizing that the deduction should be allowed in the year of actual payment, not estimation.
The Tribunal considered the arguments presented by both parties and referred to previous decisions, including one where the provisions of section 43B(f) were held to be arbitrary. The Tribunal observed that the issue had been considered in other cases and noted the stay on a judgment by the Calcutta High Court. The matter was restored back to the AO for fresh adjudication in line with the decision of the Hon'ble apex Court in a specific case. The AR of the assessee requested a similar direction for their case, which was not objected to by the DR. Consequently, the Tribunal, following a subsequent decision on a similar issue, decided to restore the issue to the file of the AO with similar directions, as requested by the AR.
In conclusion, the appeal filed by the revenue was allowed for statistical purposes, and the issue regarding the provision for leave salary deduction was restored to the file of the AO for fresh adjudication in accordance with the decision of the Hon'ble apex Court in a specific case. The Tribunal pronounced the order in open court on a specified date.
-
2013 (6) TMI 731
Deduction u/s 80IC - Manufacture - Held that:- Unable to uphold the finding of the Assessing Officer that no manufacturing activity has been carried out by the appellant. In my opinion, the appellant has furnished adequate evidence of fabrication and assembly of the steel structure for the steel project of M/s. Dharampal Premchand Ltd. at Agartala. The evidences relied on by the Assessing Officer, namely the few numbers of regular employees, and the deserted appearance of the factory shed, have been satisfactorily explained by the appellant. There can be no reasonable doubt that the appellant manufactured trusses, columns, gantries, etc. in its factory and transported these articles to the project site of M/s. Dharmapal Premchand where these articles were erected by fastening bolts on the civil work already completed by M/s. Dharampal Premchand. The appellant has carried out customised fabrication of the steel structure as per drawings provided by the contractee. The appellant has been granted registration/approval from various regulatory and Government authorities and has paid excise duty on the articles manufactured by it. For all the above stated reasons, it is held the appellant is entitled to the deduction u/s 80IC in respect of its manufacturing activities
-
2013 (6) TMI 730
Sale of shares and securities - Short term capital gain OR Income from Business or Profession - Held that:- It cannot be said that the assessee was fully devoted to the stock market transaction. Considering the nature of profession and the facts in totality, in our considered view, the lower authorities have erred in treating the Short Term Capital gains as business income. We accordingly direct the AO to treat the STCG as declared by the assessee. On that note, we reverse the findings of the Ld. CIT(A). - Decided n favour of assessee.
-
2013 (6) TMI 729
Issues involved:
The appeal filed by the Revenue challenges the order of the Commissioner of Income Tax (Appeals)-I, Coimbatore, regarding the treatment of tradable Carbon credit receipts as capital receipts under sec.143(3) of the Income Tax Act, 1961.
Details of the Judgment:
Issue 1: Treatment of Carbon Credits as Capital Receipts
The Revenue contended that the CIT(Appeals) erred in treating the receipts from carbon credits as capital in nature instead of revenue receipts. The Revenue pressed for acceptance of the appeal based on this argument.
Issue 2: Nature of Carbon Credits Receipts
The assessee claimed deduction under sec.80IA for profits from wind mills, including an amount from CDM credit. The Assessing Officer held that the carbon credit receipts are taxable revenue receipts not derived from the business, limiting the deduction. The CIT(Appeals) affirmed the AO's action but held the receipts as capital in nature based on a precedent, directing the Assessing Officer to treat them as capital receipts.
Issue 3: Judicial Interpretation
The Co-ordinate Bench, relying on a Hyderabad ITAT decision, held that carbon credits are an entitlement due to environmental concerns, not business activities. The Bench concluded that the consideration received for carbon credits is a capital receipt, not taxable income under various sections of the Income-tax Act, 1961.
Conclusion:
The ITAT upheld the CIT(Appeals)'s decision, stating that the receipt from the sale of carbon credits is capital in nature. The Revenue's appeal was dismissed, and the addition of the carbon credit receipts as revenue was deleted. The judgment was pronounced on June 11, 2013, in Chennai.
-
2013 (6) TMI 728
Issues involved: Appeal against deletion of penalty u/s 271(1)(c) of the Income Tax Act.
Summary:
The Appellate Tribunal ITAT Ahmedabad heard the Revenue's appeal against the deletion of a penalty of Rs. 34,00,000 u/s 271(1)(c) of the Act by the CIT(A)-XV, Ahmedabad for the assessment year 2008-09. The case involved the assessee filing a revised return declaring additional income of Rs. 1,00,00,000 after a survey operation u/s 133A. The penalty imposed by the AO was based on this additional income, which was later deleted by the CIT(A). The Tribunal considered various factors and legal precedents in reaching its decision.
The CIT(A) found that no incriminating material was found during the survey and that the additional income disclosed was related to a non-existing liability previously accepted by the department. The CIT(A) concluded that the penalty was not justified as the disclosure was made to buy peace of mind and there was no evidence of concealment of income. The CIT(A) relied on Tribunal decisions in similar cases to support the deletion of the penalty. The Tribunal upheld the CIT(A)'s decision, dismissing the revenue's appeal based on the specific facts and legal interpretations of the case.
In conclusion, the Tribunal affirmed the CIT(A)'s order to delete the penalty, emphasizing the lack of incriminating evidence and the context of the additional income disclosure. The Tribunal found no grounds to interfere with the CIT(A)'s decision, ultimately dismissing the revenue's appeal.
Order pronounced on 21-06-2013 by Shri G. C. Gupta, VP and Shri A. K. Garodia, AM.
-
2013 (6) TMI 727
Issues Involved:
1. Confirmation of assessment order u/s 143(3) of IT Act, 1961.
2. Treatment of receipts from sale of land and plots as business income versus long-term capital gain.
3. Determination of cost of acquisition of land.
4. Disallowance of interest u/s 36(1)(iii).
5. Disallowance of expenses incurred for payment received through credit cards u/s 40(a)(ia).
6. Addition of business receipts on transfer of business u/s 28(va).
7. Allowance of brought forward losses and depreciation.
8. Levy of interest u/s 234B.
Summary:
Issue 1: Confirmation of Assessment Order u/s 143(3)
The learned CIT(A) confirmed the assessment order passed u/s 143(3) of the IT Act, 1961, which the appellant claimed to be unjust and not binding.
Issue 2: Treatment of Receipts from Sale of Land and Plots
The main issue raised was whether receipts from the sale of land and plots should be treated as business income or long-term capital gain. The Tribunal found that the receipts should be treated as long-term capital gain, following its previous decision in the appellant's own case for earlier assessment years (2006-07 to 2008-09). The Tribunal held that the surplus arising from the sale of land is to be taxed under the head 'Capital gains' only.
Issue 3: Determination of Cost of Acquisition of Land
The AO determined the cost of acquisition of land at Rs. 8 per sq. yd., whereas the assessee claimed it to be Rs. 250 per sq. yd. The Tribunal directed the AO to adopt the actual sales consideration and accept the value determined by the approved valuer at Rs. 250 per sq. yd.
Issue 4: Disallowance of Interest u/s 36(1)(iii)
The AO disallowed net interest expenses of Rs. 3,39,47,901 u/s 36(1)(iii) on the grounds that borrowed funds were diverted to sister concerns free of interest. The Tribunal, however, found this disallowance contrary to the facts and the settled legal position, and thus ordered its deletion.
Issue 5: Disallowance of Expenses for Payment Received through Credit Cards u/s 40(a)(ia)
The AO disallowed expenses incurred for payment received through credit cards amounting to Rs. 18,42,751, treating it as 'commission' on which tax is deductible at source u/s 194H. The Tribunal held that the obligation to deduct tax at source u/s 194H is not cast upon the assessee-company, and thus the disallowance under s. 40(a)(ia) was not warranted by law.
Issue 6: Addition of Business Receipts on Transfer of Business u/s 28(va)
The AO treated the consideration received on account of slump sale of business as taxable u/s 28(va) and denied exemption u/s 47(iv). The Tribunal found that the transfer of the business undertaking was a slump sale and thus exempt under s. 47(iv). The Tribunal reversed the AO's action and allowed the exemption.
Issue 7: Allowance of Brought Forward Losses and Depreciation
The Tribunal directed the AO to allow the correct amount of brought forward losses and depreciation for the current and earlier years.
Issue 8: Levy of Interest u/s 234B
The Tribunal held that the charging of interest u/s 234B is mandatory but allows for consequential relief. Therefore, this ground could not be allowed.
Conclusion:
The appeal of the assessee was partly allowed, with significant relief granted on several grounds, including the treatment of receipts from the sale of land as long-term capital gain, deletion of disallowance of interest, and exemption for slump sale of business.
-
2013 (6) TMI 726
Validity of claim of Long Term Capital Gains (LTCG) u/s.54EC - Revenue has denied the said claim on the ground that the investment in the National Highway Authority of India (NHAI) bonds stood made beyond six months of the date of transfer, i.e., the period specified under the relevant provision, so that the assessee’s claim is not maintainable in law - Held that:- As the Revenue considers the actual outflow of funds as the relevant date of investment (in specified asset u/s.54EC), it must, on the principle of parity, also take the date of receipt of consideration, allowing a time lag of two to three working days, i.e., as in the normal course of banking business, for the same (receipt). As such, the relevant date would be upon allowing the normative time required for the realization of funds through the banking channel. We draw support or this proposition from s.27 of the General Clauses Act, 1897. The date of the agreement being 29.02.2008, i.e., the last date of the month of February, the date of receipt would - in the ordinary and regular course - fall some time in the first week of March, 2008, i.e., even if we do not consider the date of the actual receipt as being date of receipt in the normal course, being sans any details in the matter by the assessee and, thus, not relevant.
The second component of the controversy stands determined by the co-ordinate Bench of the tribunal in the case of Yahya E. Dhariwala (2011 (11) TMI 381 - ITAT MUMBAI) wherein, being guided by the fact that the provision of section 54EC is a beneficial provision, it sought to grant the benefit of doubt with regard to the word ‘month’ occurring in the provision, by construing it as a calendar month; the word being undefined. A period of six clear months from the first week of March, 2008, would, therefore, end only 30.09.2008, i.e., the date of allotment of the NHAI bonds. - Decided in favour of assessee
-
2013 (6) TMI 725
Penalty u/s. 271(1)(c) - different between the income declared in the original return of income and the income declared in the return of income filed in response to notice issue u/s. 153A - Held that:- We reject the argument of the Ld. Counsel that the issue arising in this appeal is clearly covered by the decision of Smt. Pramila Ashtekar and others (2012 (9) TMI 956 - ITAT PUNE ) to the extent of the income declared in the return filed in response to notice u/s 153A of the Act.
Whether Explanation 5A(ii) contemplates “income” and not the “expenditure”? - whether the income declared by the assessee which is pertaining to the unrecorded expenditure can said to be the income which is contemplated in Explanation 5A(ii)? - Held that:- We hold that to the extent of the income offered by the assessee pertaining to the expenditure in the returns filed in response to notice u/s 153A, Explanation-5A is applicable and as there is a legal presumption against the assessee in respect of the said income detected during the course of search and seizure operation, the assessee case is squarely covered by Explanation- 5(ii) as the assessee himself has admitted the said undisclosed income.
What is taxed u/s. 269C is the amount covered by the unrecorded expenditure and ultimately it is nothing but income applied. Admittedly, unrecorded income was also found, so in our opinion, to the extent of the quantum of unrecorded income relating to these four assessment years the assessee has source to incur the unrecorded expenditure and hence, without making any classification of unaccounted expenditure found during the course of search.We, therefore, direct the Assessing Officer to work out the penalty on the net of the unrecorded expenditure (Unrecorded Expenditure – Unrecorded Income) as shown above for all the assessment years.
-
2013 (6) TMI 724
Issues Involved:
The judgment involves determining whether the gain from the sale of two flats should be treated as capital gains or business income, and whether the benefit of indexation to the cost of land is applicable. Additionally, it addresses the contention of the assessee to bifurcate the income earned from the sale of flats into long term and short term capital gains.
Revenue's Appeal:
The revenue contended that the gain from the sale of two flats should be treated as business income, not capital gains, as the developer did not pay any amount to the assessee for the land or FSI. The revenue also questioned the justification of allowing indexation to the cost of land for arriving at short term capital gains.
Assessee's Cross Objections:
The assessee argued that the Assessing Officer's order was illegal and not in compliance with natural justice. The assessee further claimed that the capital gains from the sale of flats should be taxed separately as long term capital gains for the land and short term capital gains for the flats.
Facts of the Case:
The assessee inherited property and entered into a development agreement with a developer to construct a building on the land. The developer bore the construction cost and received the right to sell 50% of the constructed area. The assessee sold two flats to refund the security deposit, treating the income as long term capital gains. However, the Assessing Officer classified it as business income, as no money was paid for the land or FSI.
Decision and Reasoning:
The CIT(A) determined the income from the sale of flats as capital gains, considering the improvements made by the assessee. The CIT(A) allowed indexation to the cost of acquisition of land and treated the income as short term capital gains due to the flats not being retained for three years. The Tribunal found that the income was capital gains, not business income, and should be segregated into long term and short term capital gains based on the land and building components.
Conclusion:
The Tribunal dismissed the revenue's appeal and allowed the assessee's cross objections for statistical purposes. The case was remanded to the Assessing Officer for fresh assessment, considering the observations made regarding the bifurcation of income into long term and short term capital gains and the treatment of land and building components separately.
-
2013 (6) TMI 723
Assessment u/s 153A - unexplained investment - Held that:- The pattern of the questions put to the assessee during the search of the premises shows that whatever recorded in these statements is not true. Only on the basis of presumption that large scale construction was going on at the school building of the trust and hospital of the trust cannot be made a basis for addition. The Assessing Officer should have ascertained the investment by way of referring the case to the DVO if he has any doubt in this regard. No evidence regarding any anonymous donation by the trust was found and seized and nothing has been made out by the Assessing Officer in the assessment. The other assessments u/s 153A of the Act in assessee’s case for Assessment Year 2001-02 to 2006-07 have been made without any addition. Thus, in our considered view, no incriminating evidence was found against the assessee which could suggest or show that unexplained investment has been made to the tune of ₹ 15 crores and such income has been utilized or invested as stated by the assessee in the retracted statement. Nothing of such sort borne out of the facts. In our considered view, no addition can be made merely on the basis of surrender without existence of any corroborative evidence found against the assessee - Decided in favour of assessee
............
|
9911796707
