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Showing 361 to 380 of 692 Records
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2010 (5) TMI 557 - ITAT BANGALORE
set off of unabsorbed depreciation - Interest u/s 234B, 234C and 234D - Deduction u/s 80IA - . The carried forward losses of the eligible business are required to be set off first against the income of the subsequent years of the eligible business while determining the profits eligible for deduction under section 80-IA - since the specific provisions of section 80-IA(5) have overriding affect, the other provisions of law including section 70 on set-off of unabsorbed depreciation/business loss relied upon by the appellant is not attracted in the case of the appellant - it may appear that the carried forward loss of the eligible business were required to be set off first against the income of the subsequent years of eligible business while determining the profits eligible for deduction under section 80-IA of the Act and set-off of losses from other sources under the same head is not permissible Regarding interest - This ground of the assessee is not maintainable as charging of interest under sections 234B and 234C of the Act is mandatory and consequential in nature - levy of interest under section 234D is purely a legal ground and is chargeable, following the order of the Hon’ble ITAT, Delhi E, Special Bench in ITO v. Ekta Promoters (P.) Ltd. [2008 (7) TMI 452 - ITAT DELHI-E] - the assessee’s appeal is allowed
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2010 (5) TMI 556 - KERALA HIGH COURT
Search - Block assessment - Concealment of income - The Appellate Tribunal by a common order arrived at a finding that no evidence was disclosed in the search to show that there was suppression of sales for the assessment years 1996-97 to 2000-01 - A reading of section 131 of the Income-tax Act would show that the Assessing Officer is vested with the same powers as are vested in a court under the Code of Civil Procedure, 1908 in respect of (a) discovery and inspection, (b) enforcing the attendance of any person, including any officer of a banking company and examining him on oath, and (c) compelling the production of books of account and other documents - the statement of the partner and employees recorded and documents collected are relevant and admissible in respect of all matters for the purpose of any investigation connected with any proceedings under the Income-tax Act - It was further ruled that insertion of proviso to section 113 is mere clarification - While setting aside the orders in first and second appeal, the assessment order is restored with modification reducing the concealment of income at 14 per cent. of the total turnover - Appeal is allowed partly
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2010 (5) TMI 552 - CESTAT, MUMBAI
Application for stay - Letter of adjournment - Already 3 opportunities were given to them to Produce the requisite clearance from the 'Committee on Disputes' - The appeals are dismissed for want of clearance from the Committee on Disputes
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2010 (5) TMI 550 - CESTAT, NEW DELHI
Demand - Classification - Notification No. 8/01-C.E., dated 1st March, 2001 - the authorities below failed to appreciate that the claim of the Department for the period subsequent to the year 2001-02 was denied by the appellants and there was no evidence whatsoever on record to justify the liability fastened upon the appellants under the impugned order - the appellants had no case in answer to the case put forth by the Department in relation to the manufacture of those branded goods with Omega brand - In the facts and circumstances which are on record, it is difficult to accept the contention on behalf of the appellants that the respondent had failed to establish the manufacture of branded goods with Omega brand by the appellants during the period after 2001-02 - Rather, there is a clear admission about such manufacture - Decided against the assessee
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2010 (5) TMI 548 - ITAT, BANGALORE
Registration under section 12A of the Income-tax Act - applicant trust was registered under section 25 of the Companies Act - trust is to promote commerce, art and science for serving the unserved people through facility management service - assessee trust filed its application for registration under section 12A of the IT Act - assessee trust works as agent for the banks and receives remuneration for the services rendered from the banks concerned - activity of the assessee trust, falls within the realm of advancement of objects of general public utility and is hit by the proviso to section 2(15) of the IT Act - assessee trust is carrying on the business in the nature of trade, commerce or business - for this reason denied the benefit of registration under section 12A of the Income-tax Act
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2010 (5) TMI 547 - ITAT, MUMBAI
Revision - Scrutiny - Disallowance - The assessee is an investment company and during the relevant year it had income mainly from house property, income from business and capital gains - it is observed that the allowability of the said expenditure was disputed/doubted by the ld. CIT on the basis that there was no business activity of the assessee company in foreign countries - There was thus no error in the assessment order passed by the A.O. on this issue as alleged by the ld. CIT warranting any revision u/s 263 - The ld. D.R., has made an attempt to support the impugned order of the ld. CIT passed u/s 263 on the new ground which was not there given by ld. CIT in the notice issued u/s 263 to the assessee - In the case of CIT vs. L.F.D.'Silva, 192 ITR 547 - Accordingly held that there was no error in the assessment order passed by the A.O. u/s 143(3) as alleged by the ld. CIT in the notice issued u/s 263 and this being so, the ld. CIT was not justified in revising the said assessment - In the result, appeal of the assessee is allowed
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2010 (5) TMI 544 - ALLAHABAD HIGH COURT
Income from other sources – Deduction – Expenditure must be wholly and exclusively incurred to earn income – Intention to earn income must be established – Borrowed funds invested in financially fragile sister concerns – No intention to earn income but merely to assist concerns – deduction of interest paid on borrowings not allowable
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2010 (5) TMI 543 - ITAT, HYDERABAD
Depreciation - SAF Plant has been capitalized w.e.f. 1.4.1999 - The plant has not been in operation since capitalization - The entire plant and machinery is kept ready for use and was not used for business considerations, since the production of pig iron and silicon manganese is not economical, the assessee stopped the process of manufacturing the pig iron and it was selling the sponge iron directly to various industries in India - Held that: - since capitalization this SAF Plant, it was not in operation as such it cannot enter into block asset and the condition laid down in Sec.32 (1) not fulfilled and the assessee is not entitled for depreciation on this plant - This ground of the assessee is dismissed Disallowance – Provision for increased wages - Held that: - provisions made towards additional liability on account of enhanced wage and salary are allowable in the year of making such provision - Matter is sent back to the file of assessing officer for fresh consideration to allow ascertained liability on production of requisite evidence by the assessee for crystallization of this expenditure in the assessment year under consideration.
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2010 (5) TMI 540 - ITAT, MUMBAI
Capital gain - TDS - The order treating Hindalco as Agent of Alcan had been passed on 20.2.2004 i.e. after a period of two years and ten months from the end of the previous year in which Hindalco made payment to Alcan - The income so chargeable to tax was received by Alcan from Hindalco and therefore section 163(1)(c) were clearly attracted - Agent had deducted tax u/s 195 of the Act will not be a bar to proceed and pass an order u/s. 163 of the Act - It is also not the case of Agent that proceedings for assessing income of the principal, is barred by time - The purpose of section 163 is to secure payment of taxes by the non-resident where the non resident subjects himself to proceedings before the AO and expresses his willingness to discharge tax liabilities and if the same is accepted and assessment made on the non resident, there was no necessity to make an assessment on the Agent in India - Since the substantive assessment made by the Assessing Officer in the hands of the principal has been upheld by the learned CIT(A), he was wholly unjustified in confirming the protective assessment in the case of the Agent also - Hon'ble Kerala High court in the case of CIT Vs. Fertilizers & Chemicals (Travancore) Ltd., (1987 -TMI - 25894 - KERALA High Court) has held that the direct assessment on the nonresident would not affect the jurisdiction of the ITO to assess the agent of the non-resident under section 163 - Accordingly the assessee appeal is annulled Regarding interest u/s 234B - Since the relevant orders have already been quashed by us while deciding the assessee’s appeal, the departmental appeal is rendered infructuous and is liable to be dismissed on that ground - In the result, ITA No. 3667/Mum/05 is dismissed. ITA No.4685/Mum/05 is allowed. ITA No.4968/Mum/05 is dismissed. ITA No.6923/Mum/06 is dismissed
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2010 (5) TMI 539 - ITAT, MUMBAI
Reassessment - Deduction u/s 80IA - Assessing Officer was not correct in invoking the provisions of section 80IA(10) as well as re-determining the profits on the basis of tariff order of MERC which was altogether for the different purpose. Even otherwise, quantum of determination of profits having been contested in appeal and got concluded in the original assessment proceedings, the re-determination by the Assessing Officer in reassessment proceedings is not correct. - Decided in the favour of the assessee
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2010 (5) TMI 536 - ITAT, AHMEDABAD
Survey – Unaccounted money - Liability where the assessee was not under search u/s 132 - who was under search u/s 153A - Held that: - it is undisputed fact that though warrant of authorization is issued in the name of the assessee being Managing Trustee of the Trust, but it is admitted fact that no search operation was conducted in the premises of the assessee. Even in the warrant of authorization, the address of the place to be searched is not the address of the assessee individual. Admittedly, no Panchnama is also drawn in pursuance with the warrant of authorization in the case of the assessee. No documents were seized or impounded as such during the course of search from the assessee. The warrant of authorization dated 29.10.2004 in the name of the Trust and the assessee stands unexecuted in the case of assessee individual. Since in this case only survey operation under section 133A is conducted in the premises of the assessee’s Trust, it would not satisfy the requirements of section 153A of the Act. - AO was not justified in initiating proceedings or assuming valid jurisdiction under section 153A of the Act against the assessee
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2010 (5) TMI 535 - ITAT, MUMBAI
Deduction under section 80-IB(10) - The assessee-company is engaged in the business of development and construction – Disallowance of certain deduction - The Assessing Officer while completing the assessment also initiated penalty of ₹ 267644 proceeding under section 271(1)(c) of the Act on the amount of miscellaneous income ₹ 7,31,491 as the same is not eligible for the said deduction - Hon’ble Supreme Court in CIT v. Reliance Petroproducts (P.) Ltd. ([2010 (3) TMI 80 - SUPREME COURT] – Mere making wrong claim is not at par with concealment or giving of inaccurate information, which may call for levy of penalty under section 271(1)(c) – Appeal is dismissed
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2010 (5) TMI 532 - ITAT, AHMEDABAD
Addition of income - AO noted that assessee company has paid royalty of Rs. 8,22,773/- @ 3% of the net value of the “electrical yarn cleaner & classikin” - There was an agreement between Shri Rajan Patwa and RJK Industries to allow PKE to exploit the device commercially on payment of royalty - The ld. AR submitted that in the past no disallowance of royalty paid has been made - Ld. DR in rejoinder submitted that merely maintenance or development or upgradation of technology used by an assessee company cannot be made equivalent to a patent or any intellectual property right entitling the assessee company to make the payment of royalty – The claim of royalty as such cannot be allowed except to the extent of maximum permissible remuneration Disallowance of 1/3 motor car and depreciation expenses & telephone expenses – On the basis of the decision in ITA No.55/Ahd/2002 for Asst. Year 1997-98 - In the result, appeal of Revenue is allowed for statistical purposes and the appeals of assessee are partly allowed for statistical purposes
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2010 (5) TMI 530 - ITAT, MUMBAI
Arm's length price - The assessee justified the transactions under the overall TNM Method - The Assessing Officer thus made an addition of3,39,63,606 on account of disallowance of arms length u/s. 92C(4) of the Act - the submission of the learned counsel for the assessee that the operating profit/sales of the assessee at 3.56% being higher than the industry margin, therefore, The transactions between the assessee and its AEs are at arms length - Appeal is dismissed
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2010 (5) TMI 528 - ITAT, MUMBAI
Survey - Addition - Unexplained income - The reconciliation filed by the assessee before the Assessing Officer could not be verified with the factual position as on the date of survey - The physical stock inventory taken partly by physical counting and partly on the basis of details given by the branches cannot be said to be a correct method of taking physical stock during the survey - assessee has explained each and every item of difference by reconciliation - Merely on the basis that at the time of survey, some differences were found in stock that does not mean that there will be an automatic addition on account of differences - assessee has reconciled the differences with reasons and the revenue authorities did not point out anything contrary that how the reconciliation done by the assessee was incorrect Regarding cash credit - The assessee filed explanation with evidence, under that circumstance the revenue authorities have to go through those evidences and record the reasons why they are not accepting the explanation filed by the assessee - There is no finding that the cash balance shown in the cash book was not with the assessee or the cash balances were used by those concerns for some other purpose - Under the circumstance such evidence cannot be rejected merely on the basis of presumption - addition deleted.
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2010 (5) TMI 526 - ITAT, AHMEDABAD
Survey - Addition of income - Estimation of income without rejection of books of accounts - Computation of waste during manufacturing process - Held that:- We are of the view that the AO has to give a finding of fact i.e. whether or not income can properly be deduced from the accounts maintained by the assessee, even if the accounts are correct and complete to the satisfaction of the Assessing Officer and the income has been computed in accordance with the method of accounting regularly employed by the assessee. What is to be determined by the Assessing Officer in exercise of his power is a question of fact. i.e. whether or not income chargeable under the Act can properly be deduced from the books of account, and he must decide the question with reference to the relevant material and in accordance with the correct principles. Assessing Officer has not rejected the book results of the assessee in all the seven assessment years and there was no defects pointed out by the Assessing Officer, the estimation made by the AO and consequently enhancement made by the CIT(A) in four assessment years, is arbitrary and without any basis - the additions made by the Assessing Officer in these seven assessment years, including the four assessment years where the CIT(A) has enhancement the assessment deserves to be deleted.
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2010 (5) TMI 524 - ITAT, CHENNAI
Income escaping assessment - Reopening of assessments with regard to assessment years 1999-2000 to 2001-02 - The view taken in a particular assessment year cannot bind the Assessing Officer for subsequent assessment years - Supreme Court in the case of CIT vs. Kelvinator of India Ltd. (2010 -TMI - 35201 - SUPREME COURT OF INDIA ) - Held that the tangible material available with the Assessing Officer is that the assessee has received certain subscription from customers only a portion of which has been declared as income - Therefore, it can be said that the Assessing Officer had reason to believe about the escapement of income - It is valid ground for reopening of assessment reopening for assessment year 1998-99 - On the merits of the re-opening of the assessment, here also as in other assessment years, the main contention is that all the relevant material was on the record of the department furnished at the time of the assessment of the previous year - Each issue has to be weighed on its own merits and legal principles cannot be sacrificed on the altar of consistency - the assessment for 1998-99, though re-opened after four years, is validly re-opened - In the result, the cross objections of the assessee for all the years are dismissed Accrual of income - Thousands of litres of ink have been consumed lavishly over the past more than hundred years in discussing the concept of accrual and yet there is no end to it, and rightly so as it indicates the ever changing dynamics of business and commerce. Hospitality business, though in existence since more than hundred years, it has come into limelight recently with several variants and sale of timeshare unit is one such variant with which are concerned in the present group of appeals. Membership Fees - Addition - The entire membership fee received by the assessee is treated as revenue receipt, but the entire amount collected is not recognised as revenue and offered for taxation in the year of its receipt -Regarding ratio of revenue receipt - Supreme Court in the case of Madras Industrial Investment Corporation Ltd. v. CIT (1997 -TMI - 5591 - SUPREME Court) - Accordingly, to answer the question posed to the Special Bench, the entire amount of timeshare membership fee receivable by the assessee up front at the time of enrolment of a member is not the income chargeable to tax in the initial year on account of contractual obligation that is fastened to the receipt to provide services in future over the term of contract - Appeals are dismissed
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2010 (5) TMI 523 - ITAT, MUMBAI
DTAA - TDS – International charges – Whether Bauxite testing charges is a Fees for technical services - The basic thrust of assessee’s contentions is that, since no part of the testing services was rendered in India, the Chinese company did not have any tax liability in India in respect of the bauxite testing charges - The Assessing Officer thus concluded that in terms of the treaty provisions, the Indian company was to withhold tax @ 10% of the gross amount of remittance to the Chinese company - The concept of territorial nexus, for the purpose of determining the tax liability, is relevant only for a territorial tax system in which taxability in a tax jurisdiction is confined to the income earned within its border - It is no longer necessary that, in order to invite taxability under section 9(1)(vii) of the Act, the services must be rendered in the Indian tax jurisdiction - It is accordingly liable to be taxed in India under the domestic tax law whether or not the income earned by the Chinese company is liable to be taxed in India under Article 12 of the India China tax treaty - That’s a conscious choice by the respective Governments, and just because China Pakistan have negotiated a bilateral tax treaty in a particular manner, it does not mean that India China tax treaty should also be construed on the same basis - . In the case of Hindalco Industries Ltd Vs ACIT this Tribunal had an occasion to set out the principles on the basis of which tax treaties are to be interpretated The impugned payment to the Chinese company, therefore, is covered by the scope of “fees for technical services” within meanings assigned to that expression under Article 12 of the Indian China tax treaty, and is taxable in India as such – The appeal of the assessee is dismissed
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2010 (5) TMI 522 - CESTAT, NEW DELHI
Stay application - the Registry is totally careless to place the order/order-sheets on the left side of the appeal folder for convenient reading of the Bench - It is also noticed that Registry fails to place copies of the orders passed in the respective case on the second/third folder for convenience of reading of the Members of the Bench - there shall be no repetition of this laxity in future and Registrar shall issue appropriate circular in this behalf
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2010 (5) TMI 519 - ITAT AHMEDABAD
Penalty - Survey - Concealment of income - When the assessee failed to discharge the onus laid down upon him in terms of explanation 1 to section 271(1)(c) of the Act, the order of the CIT(A) is upheld to the extent penalty is imposable in this case on the difference between the income worked out @ 7% of the receipts from security services and that returned by the assessee in its profit and loss account - The rule of mens rea has to be established beyond all reasonable doubt in criminal cases, but it is not so in the case of an economic offence - In the light of provisions of sec. 271(1)(c) of the Act read with explanation 1 thereto and the aforesaid judicial pronouncements, it is well established that whenever there is difference between the returned and assessed income, there is inference of concealment - In the case under consideration the desire to conceal is apparent when the assessee was not maintaining the accounts in the course of business and inflated expenses were being debited year after year in the books written well after the close of the year even when payments for such expenses was not being made It is thus clear that all the material facts and particulars relating to the assessee's computation of income were never disclosed by the assessee, and it is further clear that the explanation offered by the assessee has not been substantiated and as well as it is not found to be plausible and bona fide one and it is against all human probabilities, especially when the conduct of the assessee shows that he has been inflating expenses and had been writing books well after the close of the year not only in the year under consideration but even in the preceding three assessment years also - Decided against the assessee
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