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Showing 241 to 260 of 938 Records
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2011 (8) TMI 1145
Issues Involved:1. Disallowance u/s 40(a)(ia) of the Income-tax Act due to non-compliance with TDS provisions. Summary:Issue 1: Disallowance u/s 40(a)(ia) of the Income-tax ActThe assessee, engaged in the construction business, filed an appeal against the order of the CIT(A) confirming the disallowance of Rs. 14,30,535/- u/s 40(a)(ia) of the Act. The AO had added back Rs. 15,12,485/- for non-compliance with Chapter XVII-B of the Income-tax Act regarding TDS payments. In appeal, the assessee argued that the disallowance was notional since TDS had been deducted and paid on 10.05.2003. The CIT(A) partially upheld the disallowance but provided relief for payments made in March 2005, where TDS was deposited before the return filing date, deleting Rs. 81,950/- from the disallowance. The assessee contended that the TDS amount with interest was deposited on 10.05.2005, before the due date specified u/s 139(1) of the Act, and cited the Finance Act, 2010 amendment, which should apply retrospectively, thus negating the disallowance u/s 40(a)(ia). The Tribunal referenced a similar case (ACIT vs. Shri Sandeep R. Kapoor) where it was held that the amendment to Section 40(a)(ia) by the Finance Act, 2010, was clarificatory and retrospective from 01-04-2005. The Tribunal concluded that if TDS was paid before the due date of filing the return, no disallowance should be made u/s 40(a)(ia). Following this precedent, the Tribunal directed the AO to verify the actual date of TDS payment. If TDS was deposited before the return filing due date, no disallowance would be warranted. Otherwise, the disallowance would be sustained. The AO was instructed to adjudicate the issue after providing the assessee an opportunity to be heard. In conclusion, the appeal was allowed for statistical purposes, with the order pronounced in open Court on 26.8.2011.
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2011 (8) TMI 1144
Revisional Power of Commissioner u/s 263 - Contention was whether on the facts and circumstances of the case and in law, the Appellate Tribunal is right in quashing the order u/s.263 without considering the decision of this Hon'ble Court in the case of FAKIR MOHMED HAJI HASAN VERSUS COMMISSIONER OF INCOME-TAX [2000 (8) TMI 44 - GUJARAT HIGH COURT]?
HELD THAT:- In the case of DY. COMMISSIONER OF INCOME TAX VERSUS RADHE DEVELOPERS INDIA LTD. [2009 (4) TMI 21 - GUJARAT HIGH COURT], it was held that, the decisions of this Court in the case of Fakir Mohmed Haji Hasan is neither relevant nor germane to the issue considering the fact that in none of the decisions the Legislative Scheme emanating from conjoint reading of provisions of sections 14 & 56 of the Act have been considered.
Having thus heard the parties, in so far as the question on which the Commissioner sought to reopen the assessment by exercising powers under section 263 of the Act is concerned, same permits no debate.
Power u/s 263 can't be exercised when two views are possible- Appellate Tribunal did not appreciate the words 'erroneous and prejudicial to the revenue' as defined in the decision of the Hon'ble Supreme Court in the case of Malbar Industrial Co. Ld. v. CIT 243 ITR 83? - HELD THAT - In the case of MALABAR INDUSTRIAL CO. LTD. VERSUS COMMISSIONER OF INCOME-TAX [2000 (2) TMI 10 - SUPREME COURT], it was said that, for example, when an Income-tax Officer adopted one of the courses permissible in law and it has resulted in loss of revenue, or where two views are possible and the Income-tax Officer has taken one view with which the Commissioner does not agree, it cannot be treated as an erroneous order prejudicial to the interests of the revenue unless the view taken by the Income-tax Officer is unsustainable in law.
In any case, we are convinced that the Tribunal was correct in holding that even if two views are possible, powers under section 263 of the Act could not and ought not to have been exercised.
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2011 (8) TMI 1143
Issues involved: Appeal against the order of Commissioner of Income-tax(Appeals) regarding depreciation rate on civil and electrical components of a windmill.
Summary:
Issue 1: Depreciation rate on civil and electrical components of the windmill
The appeal was filed by the assessee against the order of the Commissioner of Income-tax(Appeals) confirming the rate of 10% depreciation on civil and electrical components of the windmill, instead of the 80% applicable to the windmill as a whole. The Hon'ble Karnataka High Court had previously held that if a building is planned and constructed to serve the technical requirements of the assessee, it can be treated as a plant. The Income-tax Appellate Tribunal, Chennai, considered a similar issue in the case of M/s. Asian Handloom vs. DCIT and found that civil and electrical components of a windmill are indivisible parts of the windmill plant as a whole. The Tribunal held that these components cannot be treated separately for depreciation and directed the assessing authority to grant depreciation at 80% on the entire cost of the windmill, including civil and electrical components. Consequently, the appeal filed by the assessee was allowed.
Order pronounced in the open Court at the time of hearing on Thursday, the 11th day of August, 2011 at Chennai.
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2011 (8) TMI 1142
Issues Involved:
1. Validity of the order passed by the Assessing Officer (A.O.) for special audit u/s 142(2A).
2. Rejection of books of accounts u/s 145(3) and addition on account of alleged low gross profit (GP).
3. Disallowance of deduction u/s 80IB.
4. Disallowance out of depreciation.
Summary:
Issue 1: Validity of the order passed by the A.O. for special audit u/s 142(2A)
The Tribunal found that the issue regarding the validity of the order passed by the A.O. for special audit u/s 142(2A) is of academic interest only, as no addition on account of low GP was found to be justified. Therefore, this issue was not adjudicated upon.
Issue 2: Rejection of books of accounts u/s 145(3) and addition on account of alleged low GP
The Tribunal examined the fall in GP reported by the assessees. It was found that the fall in GP was explained due to the increase in the price of raw materials, salary and wages, and other manufacturing expenses. The Tribunal noted that the special auditors and the A.O. did not provide a working for the impact of the increase in raw material prices on the GP. After detailed analysis, the Tribunal concluded that the entire fall in GP was explained and no addition on account of alleged low GP was justified. Consequently, the rejection of books of accounts u/s 145(3) was also not justified.
Issue 3: Disallowance of deduction u/s 80IB
The Tribunal addressed the disallowance of deduction u/s 80IB concerning interest on LC margin money and vatav kasar income. The assessees did not press the ground regarding interest on LC margin money, and this part of the ground was rejected as not pressed. Regarding vatav kasar income, the Tribunal held that it should be reduced from the cost of purchase and not treated as income from other sources. Therefore, the A.O. was directed not to reduce vatav kasar income from the business profits for calculating the deduction u/s 80IB.
Issue 4: Disallowance out of depreciation
The Tribunal upheld the disallowance of depreciation, noting that depreciation, even if not claimed, has to be allowed while computing deduction under chapter VIA, as per the decision of the Special Bench of the Tribunal in the case of Vahid Paper Converters and the judgment of the Hon'ble Apex Court in Cambay Electric Supply Industrial Co. Ltd. No material was brought on record to show that this decision was not applicable.
Conclusion:
Both appeals of the assessees were partly allowed. The Tribunal pronounced the order in the open court on 12th August 2011.
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2011 (8) TMI 1141
Deduction u/s 80IB(10) - Profit derived from building and developing housing projects - integrated activity or not - Construction on land registered in the name of buyers directly - The total consideration quoted by the assessee consisted of both the cost of plot and cost of building - HELD THAT:- As stated by the Learned A.R, the assessee has chosen to register the plot in the name of the buyer on payment of specified amount in order to achieve cost saving and to ensure reliability. Thereafter the assessee has proceeded to construct the house as per the building plan obtained in the name of the plot owners, on payment of subsequent instalments. The assessee has also developed various public amenities within the project. In our view, all these facts should be considered cumulatively in order to ascertain the true nature of the project. On a totally of the facts, we are of the view that the assessee has undertaken developing and building housing projects as per the scheme provided in sec. 80IB(10) of the Act - Decision in favour of Assessee.
Scope of Revision Proceedings u/s 263 - The AO denied deduction u/s 80IB(10) to the assessee in the assessment year 2006-07 but allowed the deduction for AYs 2004-05 & 2005-06 - CIT proposed to deny the decision for the AYs 2004-05 and 2005-06 also - An order erroneous but is prejudicial to the Revenue - debateble issue - HELD THAT:- Scope of revision proceedings has been well explained by Hon'ble Supreme Court in the case of MALABAR INDUSTRIAL CO. LTD. VERSUS COMMISSIONER OF INCOME-TAX [2000 (2) TMI 10 - SUPREME COURT], where it was held that the Commissioner has to be satisfied of twin conditions, namely, (i) the order of the Assessing Officer sought to be revised is erroneous; and (ii) it is prejudicial to the interests of the Revenue. If one of them is absent-if the order of the Income-tax Officer is erroneous but is not prejudicial to the Revenue or if it is not erroneous but is prejudicial to the Revenue recourse cannot be had to section 263(1).
It is clear that the issue of allowing deduction under section 80IB(10) in respect of aforementioned project in the hands of the assessee is a debatable issue on which two views are possible. There cannot be any doubt that the Assessing Officer has taken one of the possible views in the impugned two years, in which case the assessment order cannot be termed as erroneous and prejudicial to the interests of the revenue. In that case, the Learned CIT could not have jurisdiction to initiate revision proceedings under section 263 in respect of the said issue. Accordingly, we set aside the impugned orders of Learned CIT.
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2011 (8) TMI 1140
The Bombay High Court dismissed all appeals raised by the Revenue as the questions of law were already answered against the Revenue in a previous case. No costs were awarded. (Case citation: 2011 (8) TMI 1140 - Bombay High Court)
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2011 (8) TMI 1139
Issues involved:
1. Disallowance of impairment loss on tea estates for A.Yr. 2007-08.
2. Computation of taxable fringe benefit u/s 115WA of the IT Act.
Issue 1: Disallowance of Impairment Loss:
The AO disallowed a sum of Rs. 1,16,000 as impairment loss related to two tea estates, stating it was a provision and not actual loss, hence not allowable u/s 37 of the Act. The CIT(A) confirmed the disallowance, emphasizing that notional loss on revaluation of assets cannot be part of the P&L account and is not allowable u/s 37. The assessee argued that the loss was due to revaluation of assets by a valuer, and the amount debited to the P&L account should be treated as allowable expenditure. However, the Tribunal upheld the disallowance, stating that under section 37, only expenditures not in the nature of capital expenditure are allowable, and notional losses are not eligible.
Issue 2: Computation of Taxable Fringe Benefit:
The AO computed the fringe benefit tax at Rs. 27,18,584 u/s 115WA, rejecting the application of Rule-8 for expense apportionment. The CIT(A) upheld this decision, citing a previous ITAT judgment. Both parties agreed that the issue was against the assessee, as per the Apeejay Tea Ltd. case. The Tribunal concurred with the CIT(A) and dismissed the appeal, highlighting that fringe benefit tax is payable on benefits provided to employees, not on income, and thus Rule-8 was not applicable for calculating fringe benefits.
In conclusion, both appeals of the assessee were dismissed based on the above reasoning and precedents cited.
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2011 (8) TMI 1138
Issues involved:
The issues involved in this case include the valuation of power generated by the assessee for the purpose of computing profit eligible u/s 80IA, the application of section 80IA(8) in determining the market value of goods transferred, and the interpretation of provisions related to captive consumption of power.
Valuation of Power Generated:
The appeal concerns the valuation of power generated by the assessee for computing profit eligible u/s 80IA. The Commissioner of Income tax (Appeals) upheld the Assessing Officer's decision to adopt a lower rate of ` 2.70 per unit for selling power, instead of the rate of ` 3.50 per unit claimed by the appellant. The Tribunal referred to a similar case where the market value of power generated was crucial in determining eligible profit u/s 80IA. It was emphasized that the market value should reflect the price that would have been paid if the power was bought from the open market. The Tribunal concluded that the market value of power generated by the assessee should be considered as ` 3.50 per unit, overturning the lower authorities' decision.
Application of Section 80IA(8):
Section 80IA(8) was invoked by the Assessing Officer to prevent the assessee from inflating the profit of its eligible unit by overstating the price of goods sold. The provision states that if the consideration for transfer of goods does not correspond to the market value, the eligible profit should be computed based on the market value. The Tribunal highlighted that this provision aims to prevent misuse of existing provisions and ensure accurate valuation of goods transferred. In this case, the Assessing Officer used a market value of ` 2.70 per unit for power generated, whereas the appellant claimed ` 3.50 per unit. The Tribunal, following legal precedents and the rationale of market value determination, directed the reassessment of profit based on the higher rate of ` 3.50 per unit.
Captive Consumption of Power:
The case also involved the interpretation of provisions related to captive consumption of power generated by the assessee. The Tribunal referenced a judgment by the jurisdictional High Court which supported the claim that profit and gains can be derived from captive consumption of power. The Tribunal emphasized that the value of power consumed should be based on the price that would have been paid if the power was bought from the open market. By applying this principle, the Tribunal accepted the appellant's argument that the market value of power consumed should be considered as ` 3.50 per unit. This decision led to the allowance of the appeal filed by the assessee.
Conclusion:
In conclusion, the Tribunal allowed the appeal filed by the assessee, directing the reassessment of profit based on the market value of power generated at ` 3.50 per unit. The decision was made in consideration of legal provisions, precedents, and the principle of accurate valuation in determining eligible profit u/s 80IA.
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2011 (8) TMI 1137
Issues Involved: The issues involved in this case are (A) Whether the Appellate Tribunal was correct in treating the lease and buy back transaction as a genuine transaction and allowing 100% depreciation on energy meters, (B) Whether the interest paid on capital borrowed for projects should be allowed, and (C) Whether the income should be enhanced by the depreciation allowed on leased assets without giving an opportunity to the Assessing Officer.
Issue (A): The issue pertains to an agreement of purchase and lease back of energy meters by the assessee in favor of Gujarat Electricity Company. The Assessing Officer initially held the arrangement to be non-genuine, but both the CIT(Appeals) and the tribunal concluded that the transaction was not sham. They found that the meters were purchased in the same year, contrary to the Assessing Officer's belief. The tribunal also considered similar transactions in the case of Unimed Technologies Ltd. and confirmed the genuineness of the transaction.
Issue (B): The contention here is regarding the interest paid on capital borrowed for setting up new units for energy generation. The Revenue argued that the interest should not be allowed as revenue expenditure, citing a case involving a different factual background. However, both the CIT(Appeals) and the tribunal found that the new units were set up for the same purpose of energy generation, using different technologies, and thus, the interest paid should be allowed as a deduction under Section 36(1)(iii) of the Act.
Issue (C): The question here is whether the income should be enhanced by the depreciation allowed on leased assets without giving an opportunity to the Assessing Officer. The tribunal, relying on the decision in the case of Unimed Technologies Ltd., confirmed the view of the CIT(Appeals) that the transaction was not sham. The court held that the clause allowing the lessor to vary lease rent based on depreciation allowance does not make the transaction bogus. Consequently, it was held in favor of the assessee and against the Revenue.
In conclusion, the High Court of Gujarat upheld the decisions of the CIT(Appeals) and the tribunal, dismissing the tax appeal as no substantial question of law was found to arise from the issues discussed.
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2011 (8) TMI 1136
Exemption u/s 11 - Registration of Charitable Trust u/s 12A read with 12AA - Assessee, a trust, set up an engineering college for charitable purposes - Mere establishment of an engineering college does not constitute a charitable activity. Accordingly, the application preferred by the respondent under sec. 12A was rejected by CIT(A) - HELD THAT:- A careful reading of Section. 2(15), 12A and 12AA of the Act, reveal that application for registration under sec. 12A has to be made before the expiry of one year from the date of creation of the trust or establishment of the institution whichever is later. The application has to be made by a person in receipt of income of the trust. Thus, while dealing with the application for registration the CIT has to examine whether the application is made in accordance with s. 12A r/w r. 17A. He may also examine whether objects of the trust are charitable or not. Sec. 12AA nowhere provides that CIT while considering the application for registration is also required to examine whether the income derived by the trust is being spent for charitable purposes or the trust is earning profit. The language employed by the legislature in s. 12AA only requires that activities of the trust or institution must be genuine which should be in consonance with the object of the trust. At this stage, the CIT is not required to examine the application of income.
Admittedly the application submitted by the respondent was in consonance with the procedural requirement prescribed in this regard. From the trust deed which was filed before the CIT the objects of the trust could be ascertained. From perusal of cl. (3) of the trust deed we find that the objects of the trust are charitable in nature and are in tune with sec. 2(15) and, therefore, CIT rejecting the application under s. 12A was unjustified - Decision in favour of Assessee.
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2011 (8) TMI 1135
Nature of land sold - Held that:- In view of the overwhelming evidence produced by the assessee before the Assessing Officer are enough to come to a definite conclusion that this land was beyond 8 kms. From the Tambaram Municipal limits. The definition of a ‘capital asset’ given in section 2(14) of the Act excludes an agricultural land from its ambit if it is situated beyond 8 kms. from the Municipal limits.
It cannot be said that no agricultural activities were being carried out on this land before sale. Moreover, as stated above, the Assessing Officer has himself accepted in substance, that agricultural activities were being carried on now and then. The fact that the assessee was showing agricultural income from this land further fortifies this contention and goes to prove the claim of the assessee. In view of the above facts, we hold that agricultural activities were carried on this land prior to sale and the income shown at ₹ 3 lakhs has to be accepted as agricultural income, as apart from that no finding has been given by the Assessing Officer in this regard.
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2011 (8) TMI 1134
Issues involved: Appeal against orders of ld. CIT(A) for assessment years 2005-06 and 2006-07.
For A.Y. 2005-06:
The assessee appealed against the estimation of income by ld. CIT(A) at Rs. 11,36,584/- compared to declared income of Rs. 3,12,259/- applying a net profit rate of 5% instead of 1.37%.
The AO rejected the books of accounts due to lack of evidence for various expenses incurred in cash and applied a net profit rate of 7%, later reduced to 5% by ld. CIT(A).
In reference to similar cases, the Tribunal restricted the addition to Rs. 1.50 lacs considering the level of transportation receipts.
Regarding household expenses, ld. CIT(A) did not make a separate addition of Rs. 40,000/- as it was covered by the trading addition confirmed.
For A.Y. 2006-07:
The assessee challenged the income estimation at Rs. 4,75,366/- against declared income of Rs. 1,56,802/- applying a net profit rate of 5% instead of 1.64%.
Considering the findings for A.Y. 2005-06, the Tribunal restricted the trading addition to Rs. 75,000/- due to lower turnover.
No separate addition was made for inadequate withdrawals as it was already considered in estimating household expenses.
In conclusion, the appeals of the assessee were partly allowed, with the Tribunal pronouncing the order on 05-08-2011.
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2011 (8) TMI 1133
Issues involved: Valuation of stock of gold jewellery and silver articles for assessment year 2006-2007.
Valuation of Gold Jewellery:
The appeal was filed against the order of the Commissioner of Income Tax (Appeals) regarding the deduction of 10% for stones, lac, and wax in the valuation of stock of gold jewellery. The Assessing Officer rejected the claim for the deduction and valued the excess stock at a higher rate, considering it as unrecorded purchases due to undervaluation by the assessee. The ld. CIT(A) upheld the decision, stating that the burden was on the assessee to substantiate the claimed deductions. The Tribunal found that the valuation by the assessee resulted in underestimation compared to the actual purchase cost, and as no evidence was provided to support the purity adjustments, the appeal was dismissed.
Valuation of Silver Articles:
The appeal also contested the valuation of unaccounted stock of silver articles, with the assessee claiming a purity of 70%. The Assessing Officer valued the silver articles at a higher rate than claimed by the assessee, similar to the approach taken for gold jewellery. The ld. CIT(A) dismissed the appeal, emphasizing the lack of substantial evidence to support the purity adjustments. The Tribunal reiterated that the valuation should be based on cost or market price, whichever is lower, and as no material was presented to prove a lower realizable value, the decision of the ld. CIT(A) was upheld, resulting in the dismissal of the appeal.
Conclusion:
The Tribunal affirmed the decisions of the lower authorities regarding the valuation of both gold jewellery and silver articles, highlighting the absence of sufficient evidence to support the claimed deductions and purity adjustments. As a result, the appeal of the assessee was dismissed.
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2011 (8) TMI 1132
Nature of income - Held that:- Assessee has earned interest on bank deposit and share application money amounting to ₹ 14,39,68,000/-. The said income has declared as business income which the AO has treated as income from other sources being interest earned on surplus funds. We find that the assessee was not engaged in money lending business and the interest was earned by parking surplus funds in banks and with other (share application money). Hence the same cannot be chargeable under the head “income from business and profession” and can be treated as only “income from other sources. Hence we confirm the order of the Ld. CIT(A) and dismiss the appeal of the assessee on this issue.
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2011 (8) TMI 1131
Issues Involved:
The issues involved in the judgment are determination of interest on duty payable, applicability of Rule 57-I (3) of Central Excise Rules 1944, and the liability of the appellant for interest on defaulted duty payment.
Determination of Interest on Duty Payable:
The appellant argued that the interest calculated in Annexure A to the show cause notice is not leviable on them as the liability arose only on the day the appeal was finally decided. The appellant contended that Rule 57-I (3) of Central Excise Rules 1944 was not prevalent when the show cause notice was issued, making the demand unenforceable against them.
Applicability of Rule 57-I (3) of Central Excise Rules 1944:
The Departmental Representative supported the first appellate order, stating that interest on duty becomes due from the date of default till the payment to the Government. Referring to a Tribunal decision and the Apex Court decision in Escape India Ltd. case, it was argued that the manner in which interest is levied was correct.
Liability of the Appellant for Interest on Defaulted Duty Payment:
After hearing both sides and examining the records, the Tribunal found an admitted default in the case where duty was not paid on the due date. The Tribunal emphasized that the right to interest follows the right to restoration, as per Section 11AA of the Central Excise Act, 1944. The Tribunal highlighted the importance of timely payment of public revenue for public welfare and confirmed the first appellate order, dismissing the appeal.
[Dictated & Pronounced in the open Court].
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2011 (8) TMI 1130
Warrant of authorisation under Section 132 (1) issued in the joint names - Held that:- We do not find that the Tribunal has committed any error in law in relying upon the judgment in Smt. Vandana Verma's case (supra) in which it was held that where the search operations are carried out in the joint names, the individual assessment could not have been made. The Court has given reasons to reach to such conclusion. They have held that in case, the authorizing authority had information in his possession in consequence of which he had reason to believe that Mudit Verma and Vandana Verma though living in a single premises as husband and wife, possessed undisclosed assets including income separately, then, he might have issued warrant of search individually for conducting the search as both Mudit Verma and Vandana Verma are assessed to income tax in their individual capacity. When warrant of authorization was issued in the joint names it was not open for the assessing authority to assess Smt. Vandana Verma on the basis of the assets and documents seized during the course of search in pursuance of the warrant of authorization which was in the joint names, and that too by invoking the provisions of Chapter XIV-B in an individual capacity. She could be assessed jointly only as AOP of BOI as per the definition of the word "person" under the Income Tax Act.
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2011 (8) TMI 1129
Addition u/s 14A - Held that:- Assessee is having sufficient own funds and when he has borrowed funds even if he is having own funds, the presumption always goes in favour of the assessee that the assessee made investments out of own funds, therefore, the provisions of section 14A of the Act, is not applicable to the case of the assessee. In view of the said discussion, we set aside the order of the CIT(A) and delete the disallowance made by the AO u/s 14A of the Act. Accordingly, the grounds raised in AY 2006-07 is allowed.
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2011 (8) TMI 1128
Denial of deduction u/s 80-IA(4) - income derived by the assessee from development of eligible infrastructural facilities - Held that:- Order of the Income Tax Appellate Tribunal shows that the Income Tax Appellate Tribunal passed the order in favour of the Revenue by relying upon its decision in the case of B.T. Patil and Sons Belgaum Const. (P) Limited V/s. ACIT [2009 (10) TMI 521 - ITAT MUMBAI]
It is not in dispute that the said decision of the Income Tax Appellate Tribunal in the case of B.T. Patil & Sons (Supra) has been recalled by the Tribunal by order in BT. PATIL & SONS BELGAUM CONSTRUCTION (P.) LTD. VERSUS ACIT [2012 (6) TMI 316 - ITAT, PUNE]
The impugned order of the Tribunal relating to AY 2003-04 is quashed and set aside and the matter is restored to the file of the Income Tax Appellate Tribunal for fresh decision in accordance with law.
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2011 (8) TMI 1127
Whether the implementation of the 27% reservation for other backward classes (for short `OBCs') in Central Educational Institutions under the Central Educational Institutions (Reservation in Admission) Act, 2006 (Act No.5 of 2007) (for short `CEI Act') valid?
Whether is the meaning to be assigned to the direction "the maximum cut-off marks for OBCs be 10% below the cut-off marks of general category candidates" in the order dated 14.10.2008 of this Court?
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2011 (8) TMI 1126
Issues involved: Challenge to notice of reopening of assessment, objections raised by petitioner, duty of Department to consider objections.
The petitioner challenged the notice of reopening of assessment dated 15.9.09, contending that it is bad in law. Detailed objections were raised by the petitioner upon receipt of reasons for reopening via communication dated 22.2.2010. However, these objections have not been disposed of yet. The petitioner also mentioned that the time limit for passing the order on the re-assessment proceedings has expired.
In response to the notice, the respondents appeared and filed a reply. It was noted that reference was made to the Transfer Pricing Officer, leading the Revenue to claim a longer period of limitation for completing the assessment. Despite this, it is undisputed that the objections raised by the petitioner on 22.2.2010 remain unresolved. As per the decision in the case of GKN Driveshafts (India) Ltd v. ITA, 259 ITR 19, the Department was obligated to consider these objections and dispose of them in accordance with the law.
The petition was disposed of with directions for the respondents, particularly the Assessing Officer, to address the petitioner's objections to the notice for reopening within four weeks from the date of receiving a copy of the order. Following the disposal of objections, if the petitioner remains aggrieved, they are entitled to pursue further legal remedies available to them.
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