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Showing 481 to 500 of 1678 Records
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2016 (9) TMI 1202
Capital gain on inherited land sold - indexed cost of improvements - Held that:- It is a fact that the assessee has filed a detailed cash flow showing different sources from which the money has been brought in. The assessee also has explained that during those days bank accounts were not so common and large families used to keep cash with themselves as most of the receipts were from agriculture and other allied sources. The fact that without improvements the assessee would not have received this amount is also pointed out. The learned DR has not raised any specific objection to the cash flow other than the opening balance, the non banking of cash and production of records for the past 26 years from 1.4.1981 onwards. The learned Counsel has requested the Hon. Bench to have a pragmatic approach in respect of old records as normally people miss or misplace records after a reasonable period.
In the circumstances and facts of the case, it is evident that the assessee has made substantial improvements to the land which is supported by year wise cash flow. The Assessing Officer has simply ignored the cash flow stating various other reasons. The Ld. CIT(A) has considered the cash flow and in order to compensate any probable defects and omissions has made an estimated disallowance of 40% which the learned DR during the course of hearing has accepted as correct except for the size of the amount. However, to meet the interest of justice, the disallowance of cost of improvement is directed to be fixed at 45% of the cost claimed, i.e., the assessee is eligible for 55% of the improvement cost claimed. This will take care of defects pointed out by the Assessing Officer and Ld. DR including the opening cash in hand.
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2016 (9) TMI 1201
Disallowance of Exemption under section 54F - Held that:- Since the assessee in the case on hand has utilized the amount of capital gains in investing in the purchase of a residential property (flat) within the extended period as stipulated under section 139(4) of the Act for A.Y. 2008-09, the assessee is entitled for exemption under section 54F of the Act.
Disallowance under section 14A - Held that:- We have heard the rival contentions of both the parties and perused and carefully considered the material on record. From the working of the disallowance under section 14A r.w. Rule 8D(2)(iii) made by the AO at para 4 of the order of assessment, it appears to us that there is some merit in the averments of the learned A.R. However, we restore the matter for verification of the correctness of the assessee’s claim, that the AO’s computation of the disallowance under Rule 8D(2)(iii) at ₹ 2,56,495/- is incorrect and that correct working of the said disallowance by the assessee is ₹ 1,28,247/- as given at para 5.1 (supra). The AO is directed to verify the veracity of the assessee’s claim and workout the correct disallowance under section 14A r.w. Rule 8D(2)(iii) after affording the assessee adequate opportunity of being heard.
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2016 (9) TMI 1200
Purchase and sale of shares - business income or Capital gain computation - Held that:- There were no borrowings by the assessee and no interest was paid. The number of transactions has also come down in the impugned assessment year as compared to the preceding assessment year. The average period of holding was 95 days and number of transactions were 70 , while for assessment year 2005-06 it was 70 days and 119 transaction while for assessment year 2006-07 , the average period of holding was 129 days and transactions were 107. In the preceding assessment year 2006-07, the learned CIT(A) has allowed the appeal of the assessee whereby the said gains were accepted as short term capital gains by the learned CIT(A) and the Revenue has accepted the orders of the learned CIT(A) as it was not brought to the notice of the Tribunal that Revenue has preferred further appeal with the Tribunal in this regard for assessment year 2006-07.
The AO accepted the said gains as short term capital gains while framing assessment u/s 143(3) of the Act for the assessment year 2005-06. The factual matrix in the instant assessment year under appeal is similar to the preceding assessment years i.e. 2005-06 and 2006-07 and we do not find any reasons of deviating from the settled position in this year. Keeping in view of the above facts and circumstances of the case, we are of the considered opinion that principle of consistency has to be maintained and followed in this year as facts are almost similar to that of preceding years and hence we direct that the income earned by the assessee from purchase and sale of shares with respect to shares held for not more than one year be held as short term capital gains chargeable to tax under the head ‘Capital Gains’ and not as business income chargeable to tax under the head ‘Profits and Gains from Business or Profession’ as held by the authorities below .
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2016 (9) TMI 1199
Amortization of expenditure under Section 35D - Whether expenditure incurred on issue of shares is eligible to be amortized? - Held that:- AO was satisfied that there was expansion of the facilities to the industrial undertaking of the assesseee. It is on this satisfaction that for the Assessment Year 1996-97 also the expenses were allowed. Once, this position is accepted and the clock had started running in favour of the assessee, it had to complete the entire period of 10 years and benefit granted in first two years could not have been denied in the subsequent years as the block period was 10 years starting from the Assessment Year 1995-96 to Assessment Year 2004-05. The High Court, however, disallowed the same following the judgment of this Court in the case of Brook Bond India Ltd (1997 (2) TMI 11 - SUPREME Court). In the said case it was held that the expenditure incurred on public issue for the purpose of expansion of the company is a capital expenditure. However, in spite of the argument raised to the effect that the aforesaid judgment was rendered when Section 35D was not on the statute book and this provision had altered the legal position, the High Court still chose to follow the said judgment. It is here where the High Court went wrong as the instant case is to be decided keeping in view the provisions of Section 35D of the Act. In any case, it warrants repetition that in the instant case under the very same provisions benefit is allowed for the first two Assessment Years and, therefore, it could not have been denied in the subsequent block period. We, thus, answer question No. 1 in favour of the assessee holding that the assessee was entitled to the benefit of Section 35D for the Assessments Years in question.
Deduction for payment of bonus by the assessee to its employees - Whether deduction on account of payment of bonus to the employees of the assessee is not eligible under Section 36 of the Act, as it is hit by Section 40A(9) of the Act? - Held that:- The amount paid by way of bonus is one such expenditure which is allowable under clause (ii) of sub-section (1) of Section 36. There is no dispute that this amount was paid by the assessee to its employees within the stipulated time. Embargo specified under Section 43B or 40A(9) of the Act does not come in the way of the assessee. Therefore, the High Court was wrong in disallowing this expenditure as deduction while computing the business income of the assessee and the decision of the ITAT was correct.
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2016 (9) TMI 1198
Income from house property - annual value of the property computation - inclusion of maintenance charges as part of the rent - Held that:- The actual rent received would be much higher where the facilities are better. Section 23 provides that the annual value of the property shall be deemed to be the sum for which the property might reasonably be expected to let from year to year or where the property is let, the actual rent received or receivable by the owner whichever is higher. In either case the rent that is received in respect of the premises in a building where the common amenities are better is bound to be higher than the rent that is expected to be received or is received in a building where the amenities are not as good.
Where the agreement provides that the owner shall pay the amounts for the common facilities, maintenance charges, outgoings etc. it is obvious and reasonable to presume that the same is factored into the rent, fee or compensation payable by the lessee or the licencee. In that event the same cannot be added to the rent agreed to be paid. However, if the maintenance charges etc. are stipulated to be payable by the licencee or the lessor it must form a part of the rent for the purpose of computing the annual value of the property.
A view to the contrary would enable a party to undervalue the annual value of the property for the purpose of section 23 by the simple expedient of providing for the payment of the maintenance charges etc. and the rent separately.
The maintenance charges must be included as part of the rent for the purpose of computing the annual value of the property. The assessee is not prejudiced thereby in any event. We are informed that the amounts received under the sub-sub-licencee had been brought under the head “Income from house property”. Section 24 provides that the income chargeable under the head “Income from house property” shall be computed after making the deductions specified therein. Under clause (a) of Section 24, a sum equal to thirty percent of the annual value is liable to be deducted. The assessee has, therefore, the benefit of deductions under section 24 as well as under the proviso to section 23 of the Act. - Decided against the assessee.
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2016 (9) TMI 1197
Revision u/s 263 - Gross Profit ratio - disallowance of expenditure - additions on account of bogus purchases - Held that:- Assessing Officer disallowed the entire expenditure and added back the full sum of ₹ 62.75 lacs shown to have been expended by the assessee for purchases from F.H. Rizvi concerns. There was no further material with the Assessing Officer or even possible avenue for inquiring whether remaining purchases of assessee were genuine or not. There was thereafter, no further scope of making addition in the guise of adjusting the Gross Profit ratio. The disallowance itself would automatically reflect in increasing the Gross Profit from one claimed by the assessee in the original return.
Only on this ground, the order of assessment can be stated to be neither erroneous nor prejudicial to the Revenue. If the Commissioner had an angle of further inquiry to be made with respect to purchases from party unconnected to F.H. Rizvi, such angle has not come on record. The notice issued by the Commissioner does not suggest that since it was found that all purchases from F.H. Rizvi by the petitioner were bogus, the Assessing Officer could have inquired into the genuineness of the remaining purchases also. All that the Commissioner conveyed by way of reasons in the impugned notice was that the Assessing Officer did not bear in mind the Gross Profit ratio element. It is true that increasing the Gross Profit is one of the modes adopted by the assessing authority while adjusting the claim by the assessee. This can be so on the basis of materials on record suggesting that the current rate of Gross Profit does not reflect the true financial picture. Nevertheless, the same methodology cannot be applied arbitrarily without atleast some materials suggesting that the Gross Profit presented by an assessee was inaccurate. When the entire block of purchases made by the assessee is disallowed, the same would have automatic and direct impact on bringing up the Gross Profit ratio of the assessee during such year. Without there being any further material suggesting that other purchases were also not genuine, further increase of the Gross Profit ratio, was an option simply not available with the Assessing Officer.
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2016 (9) TMI 1196
Entitlement for interest under Section 244A - delay in refund - belated return filing - whether once the delay in filing the return has been condoned, it becomes a valid return and therefore grant of interest is consequential? - Held that:- The liability to pay interest on refund arises from the date when claim for refund is made with all necessary particulars. As already indicated, Section 244A(2) imposes a restriction on payment of interest when the procedure for refund is on account of the delay attributed to the assessee. In the case on hand, what is to be looked into is whether the delay in refund was due to a cause attributable to the assessee.
The facts involved in the case would disclose that the return of income for the assessment year 1997-98 was filed only on 01/02/2000 on account of delay in auditing. Return was filed belatedly and thereby it was rejected. Thereafter an application was filed under Section 119(2)(b), seeking for condoning the delay in filing the return, was rejected and ultimately the matter reached this Court wherein this Court had directed the delay to be condoned. There cannot be two ways to look at it. Admittedly, there had been delay on the part of the assessee which had given rise to a situation to condone the same. Delay has been condoned only for the purpose of accepting the return. But it cannot be stated that the delay was not attributable to the assessee. Even if such instances where the delay is condoned, still when it is attributable to the assessee, there is justification on the part of the Commissioner to deny interest under Section 244A(2). Therefore, no error in the impugned orders passed by which the claim for interest has been rejected.
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2016 (9) TMI 1195
Reopening of assessment - exemption from the payment of capital gain - agricultural land - nature of land - Held that:- There is serious doubt about genuineness of the certificate dated 16.1.2013 of the Executive Engineer certifying that the land in question was situated beyond 8 kms from the outer limit of Vadodara Municipal Corporation, upon which the petitioner heavily relied. Shri K.D. Patel who is supposed to be the author of the certificate has since retired from Government service but has filed an affidavit stating that he has never issued the said certificate and the document does not carry his signature. The Road and Building division contends that a copy of said certificate is not found in their official records.
A strong case is built up against the petitioner of having produced a document which was not genuine. For the purpose of this petition, atleast, we must proceed on the basis of declaration of official of Road and Building division that no copy of such document is found on the record and Shri K.D. Patel, retired Executive Engineer, who has gone on oath stating that he had never issued said certificate. If that be so, the very foundation of the petitioner's case of the land being at a distance of more than 8 kms from the outer limit of Vadodara Municipal Corporation fails. This would also match with the present information which Revenue collected after the assessment was over in form of statement of Shri Sohan M. Patel and certificate issued by the Deputy Collector of Vadodara Municipal Corporation, both indicating that the distance between the two limits is much shorter. In fact, the Executive Engineer of Road and Building division also in the latest affidavit has confirmed this aspect.
In view of such facts, we are not inclined to quash the notice for reopening. However we clarify that the assessment may be carried out on the basis of evidence that may be brought on record including by the petitioner, unmindful of the observations made hereinabove.
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2016 (9) TMI 1194
Application to stay the recovery of the demand - Held that:- In the present case by the impugned order dated 14.06.2016 the petitioner was required to deposit 15% of the outstanding demand, namely, ₹ 41.64 crores. This figure attained finality. At the cost of repetition, the Assessing Officer did not refer the matter to the Administrative Pr.CIT for an amount higher than 15% of the amount to be deposited as a condition for stay. This infact indicates that the last sentence in paragraph 5 of the order dated 14.06.2016 granted the Assessing Officer the right to adjust any refund which may arise in favour of the assessee in respect and to the extent of the said 15% of the demand only. In any event, even if it entitles the Assessing Officer to adjust any refund against the entire tax demand, it would be contrary to the instructions of the CBDT contained in the Office Memorandum dated 29.02.2016.
Lastly, Mr. Putney submitted that the Assessing Officer has unbridled powers under section 220(6) of the Act. However, in view of the circular dated 02.02.1993 as clarified by the circular dated 21.03.1996 and modified by the Office Memorandum dated 29.02.2016 the Assessing Officer’s powers have been circumscribed to the extent provided therein.
We quite see the force in Mr. Putney’s contention that the department must safeguard its interest and that its interest may be jeoparadized if the petitioner is entitled to avail of the refund and at the same time enjoy the benefit of the stay. However, the Department is bound by the circular as modified by the Office Memorandum. Had the circulars/Office Memorandum not been in force, it may have been a different matter altogether.
In the circumstances, the writ petition is disposed of by holding that the petitioner shall be entitled to a stay of the demand subject to its depositing the installments as required by the order dated 14.06.2016 and that the future refunds can be adjusted only to the extent of the balance amount directed to be paid as a condition for the stay.
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2016 (9) TMI 1193
Application for approval under section 10(23C) rejected - Held that:- It can thus be seen that generating certain surplus after carrying out educational activities by itself would not indicate that the institution did not exist for educational purposes but for the purposes of making profit. Whether the surplus so generated was utilized for the purposes of educational activities also would be a relevant consideration. Be that as it may, when the petitioner contends that the Commissioner had not taken into account correct figures and was thus misguided into coming to the conclusion that the petitioner had generated sizeable profit, it would be appropriate to request the Commissioner to reconsider the issue with the assistance of the petitioner.
Before doing so, we may dispose of two peripheral grounds. First is regarding charging of fees higher than what was prescribed by the fee regulatory committee. On this issue also, the petitioner's stand has been that no excess fee was charged. It was only collection of form application money which gave a wrong picture. Even this aspect, it would be open for the petitioner to point out to the Commissioner upon remand.
The last objection of the Commissioner is regarding non-filing of the audit report as required under the 10th Proviso to section 10(23C). This proviso provides that where the total income of the trust or institution referred to in clause (vi) besides others without giving effect to the exemption clauses exceeds the tax exemption limit such trust or the institution shall get its accounts audited and furnish the same alongwith return of income. This requirement obviously would arise at the time of filing of the return and not at the time of filing of application for approval and was therefore, wrongly invoked by the Commissioner for rejecting the application. In case of American Hotel and Lodging Association Educational Institute vs. Central Board of Direct Taxes and others reported in [2008 (5) TMI 17 - SUPREME COURT OF INDIA ] the Supreme Court had occasion to examine these provisions and held that the threshold conditions are actually existence of an educational institution and approval of the prescribed authority for which every applicant has to move an application. Various provisos under section 10(23C) for requirements and the same of the provisos were seen as laying down monitoring conditions in order to make the section workable. In case of Queen's Educational Society (2015 (3) TMI 619 - SUPREME COURT ) it was observed that if the activities of the institution are not genuine or are not being carried in accordance with the conditions subject to approval, the exemption must forthwith be withdrawn.
If the case of the Commissioner was that the petitioner did not fulfill the requirements of the third proviso, it has not been elaborated in the impugned order. However, we leave this question also open.
In view of above discussion, the impugned order is set aside. The proceedings are placed back before the Commissioner for fresh consideration and disposal in accordance with law. The petitioner will have opportunity to place additional material and made submissions before the Commissioner before final order is passed, which shall be done bearing in mind the observations made by the Supreme Court in case of Queen's Educational Society ( 2015 (3) TMI 619 - SUPREME COURT ) and other decisions cited therein preferably by 31.12.2016.
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2016 (9) TMI 1192
Grant of interim orders - grant of stay - Held that:- The Officer, while considering the Stay Application, should consider the three factors pointed out above, should see as to whether the assessee has made out a case for grant of unconditional interim order/conditional interim order, or for rejecting the application for stay, in toto. Therefore, to do such exercise, reasons have to be recorded, and there is no such reasons assigned in the impugned order presumably, because, the first respondent, being a Subordinate Officer, would be bound by the circulars issued CBDT.
Considering the fact that, in respect of two cases, pertaining to the two assessment years 2007-08 and 2008-09, the petitioner has succeeded before ITAT, and other Appeals are also pending, and those Appeals should also be heard by the Commissioner of Income Tax Appeals -11. So far as the assessment order, dated 06.09.2016, for the years 2010-11 to 2012-13 is concerned, it is submitted by the learned counsel appearing for the petitioner that the certified copy of the order is yet to be received by them, and they would challenge the same before the Tribunal.
Thus the Appeals filed by the petitioner for the assessment years 2010-11 to 2012-13, have already been disposed of, and the impugned assessment is relating to the year 2013-14, it would be suffice to direct the fourth respondent-Commissioner of Income Tax (Appeals)-11 to consider the Appeal Petition filed by the petitioner on merits and in accordance with law, as expeditiously as possible, preferably, within a period of eight weeks from the date of receipt of a copy of this order. Until the disposal of the Appeal, no action for recovery shall be initiated by the respondents.
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2016 (9) TMI 1191
Deduction under Section 80HHC to be worked out without giving effect to the provision of Section 80IA(9) - Held that:- Admitted facts are that on identical issue, this Court has in case of Commissioner of Income Tax vs. Atul Intermediates [2014 (4) TMI 676 - GUJARAT HIGH COURT] held that nothing contained in Section 80HHC suggests that the deduction provided therein was immune from any outside influence that the provision was impregnable by any other statute or enactment. Accepting any such theory would lead to incongruous results. It was held that the provision of sub section (9) of Section 80IA would have to be applied while considering the assessee's claim for deduction under Section 80HHC of the Act. Thus, the issue was decided against the assessee. Ordinarily, therefore, we would reject such a question without any further discussion. Assessee, however, pointed out that different High Courts have taken different views on the topic. The Supreme Court has granted SLP and is in seizing of the controversy. Learned Judges of the Bench, who heard the appeals, were divided in their opinion each passing reasoned order. In view of this disagreement, the issue is now referred to the larger bench. These orders are reported in case of Assistant Commissioner of Income Tax vs. Micro Labs Ltd. reported in [2015 (12) TMI 708 - SUPREME COURT ]. Learned counsel for the assessee, therefore, submitted that these questions may also be kept pending or, at any rate, be allowed to be re-agitated. If by the time this appeal is taken up for hearing, the decision of the Supreme Court is available.
In view of the binding judgement of this Court which squarely covers the issue, we are unable to accept either of the two suggestions. Today, insofar as this Court is concerned, the question is governed by the decision in case of Atul Intermediates. In absence of any extraordinary reasons, we are duty bound to follow the judgement. Such question is, therefore, rejected.
The last surviving suggestion of counsel for the assessee, however, needs to be accepted. He submitted that the certificate in terms of Section 261 of the Income Tax Act may be granted with respect to this question. Section 261 of the Act which pertains to appeal to Supreme Court provides inter alia that an appeal to High Court shall lie from any judgement of the High Court, in any case which the High Court certifies to be fit one for appeal to the Supreme Court. In the present case, when we notice that different High Courts have taken different views, the Supreme Court has granted SLP, the appeal is pending hearing at the hands of larger bench on account of difference of opinion between the two learned Judges of the Bench, such a fitness certificate is required to be and is hereby granted.
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2016 (9) TMI 1190
Refund of excess amount paid under Kar Vivad Samadhan Scheme Rules, 1998 - Held that:- Under normal circumstances, the respondent would be justified in stating that no refund is payable on any amount paid pursuant to the declaration made under Section 88, in the light of the statutory embargo under Section 93. However, the facts of the present case are different and amount has been paid based on interim direction. The further fact which has to be taken note of is that the petitioner succeeded in the earlier petitions, which were allowed by order dated 23.02.2001 and the said order was implemented by giving effect to the stay order and the Department passed consequential order on 21.09.2001, wherein it has been stated that there is a reduction in the demand of ₹ 2,97,627/-. That apart, the case also having been settled under the KVSS, the petitioner is entitled for refund of the excess amount paid as per the actual amount payable as per the revised demand pursuant to the order passed in the earlier Writ Petitions.
Accordingly, the Writ Petition is allowed and the impugned order is set aside and the respondent is directed to refund the excess amount paid by the petitioner, viz., ₹ 76,292/-. However, the plea for interest stands rejected.
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2016 (9) TMI 1189
Depreciation on pay loaders - nature of asset - Held that:- Pay loaders are used on hire for excavation of soil and are also used equally for transport of the excavated soil. Pay loaders are also registered as “motor vehicles” with the road transport authorities. In that view of the matter the contention of the assessee was upheld. - Decided against revenue
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2016 (9) TMI 1188
Entitlment to deduction under section 80-IB - assessee had not filed audit report in Form No.10CCB along with the return of income - Held that:- The submission of the audit report u/s.80IB can be filed even during the course of assessment proceedings. See Murli Export House [1995 (8) TMI 4 - CALCUTTA High Court ]
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2016 (9) TMI 1187
Expenditure on the issue of convertible debentures - nature of expenditure - revenue or capital expenditure - Held that:- In the present case, a part of the convertible debentures has been converted into equity shares, for which the assessee has incurred expenses. According to the assessee, the expenses incurred were in respect of issuance of convertible debentures. The facts indicate that a portion of the convertible debentures was converted into equity shares and thereby, the assessee company got enduring benefits. Since capital can be raised by converting debentures into equity shares, we are of the view that expenditure incurred by the assessee on conversion of convertible debentures into equity shares would have to be treated as capital expenditure. - Decided in favour of the Revenue
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2016 (9) TMI 1186
Reopening of assessment - Held that:- There is no bar under the I.T. Act, 1961 regarding issue of notice u/s 148 of the Act after completion of assessment u/s 143(1) of the Act. The Assessing Officer had satisfied the ingredients of section 147 of the Act and therefore, it was open to the Assessing Officer to exercise that power, not with-standing the fact that there were other remedies open to him under the Act.
Taxability on amount received - relevant assessment year - amount admittedly pertains to more than fifteen earlier years - credit of tds - Held that:- The Hon’ble Supreme Court in Rama Bai VS CIT (1989 (11) TMI 2 - SUPREME Court ) has held that Interest on enhanced compensation awarded under the Land Acquisition Act accrues year after year and not on the date of granting enhanced compensation. In view of this articulation of law by the Hon'ble Apex court, there can be no question of charging the entire amount of interest to tax in the year of receipt as has been done by the authorities below. Tthus CIT(A) was not justified in charging to tax the amount of interest received in the year, which obviously did not relate to the year in question.
A careful perusal of the provision indicates that the credit for TDS can be allowed only for the assessment year for which the corresponding income is offered for taxation. There can be no question of allowing credit for the TDS in the assessment of a year for which the matching income is not offered for taxation. In other words, both the income and credit for TDS go hand in hand and cannot be disassociated from each other. As the amount of interest on which tax has been withheld is not chargeable to tax in the instant year, the assessee cannot equally be allowed credit for TDS on such interest income against other income. When confronted with this position, the ld. AR contended that since the AO allowed credit for such TDS, the Tribunal cannot disallow the same.
We are not convinced with the submission. The patent reason for not disallowing credit for such TDS by the AO is that he charged to tax the entire interest income in the year in question and impliedly following the prescription of section 199, allowed the credit for TDS. As the interest income is held to be not chargeable to tax in the year under consideration, the assessee cannot be allowed to avail credit for TDS on such interest income against tax on his other income. To sum up, the interest income of Rs.Rs.13,91,472/ - is not chargeable to tax and further no credit for TDS of Rs.l,41,825 on such interest can be allowed in the instant year.
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2016 (9) TMI 1185
Disallowance of foreign exchange fluctuation loss - loss arising on revaluation of outstanding loans on the balance sheet date on the ground that same is capital loss and is not allowed as deduction - Held that:- Notional loss which arises owing to adverse fluctuation in foreign currency rates as on 31-03-2008 which led to restatement / revaluation of interest bearing loans denominated in foreign currency extended by the assessee company to its foreign AE in UAE and which could not be proved by the assessee company to have been extended for trade/business purposes , the presumption shall arise that loan is on capital field until the same is rebutted by the assessee company and hence the said notional loss arising on restatement/revaluation of foreign currency loans as on the date of Balance Sheet as on 31-03-2008 due to adverse foreign exchange fluctuations cannot be allowed as deduction u/s 37(1) of the Act while computing income of the assessee chargeable to tax under the Act.
In the instant case the assessee company is not able to demonstrate that the loans/advances granted by the assessee company to its foreign AE in Emirates of Dubai in UAE was in the nature of trade/business advances for the purposes of business of the assessee company which has been in-fact actually utilized by its foreign AE for its business purposes. Hence keeping in view the peculiar facts and circumstances of the case as set out above , we dismiss the appeal filed by the assessee company - Decided against assessee.
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2016 (9) TMI 1184
Unexplained source of the cash deposits - Held that:- The assessee has deposited cash in bank to the tune of ₹ 16,18,000/- for which the assessee has explained by way of cash flow statements , cash book , bank book/summary, bank statements etc. to justify the sources of the cash deposit which mainly is claimed by the assessee to have arisen from business receipts from dress designing business, receipt of interest income in cash from Manohar Ahuja and re-deposit of cash withdrawn from the bank accounts as set out above. The assessee has submitted paper book which contained various bank statements, cash book and summary charts to explain that shortage of cash was only to the tune of ₹ 4,29,452/- and not ₹ 16,18,000/- as alleged by the authorities below and submitted that to the extent of ₹ 4,29,452/- addition is sustainable and acceptable to the assessee . These contentions along with documents and cash flow/summaries submitted have not been verified by the authorities below. In our considered view and in the interest of justice and fair play, we set aside and restore this issue back to the file of the A.O. for verification , examination and enquiry of the claim of the assessee , in the light of the cash flow statement , summaries, cash book, bank statement and other relevant evidences which the assessee files to support her contentions in her defense with respect to the deposit of the cash in the bank , and also in the light of any other explanation which the AO may require for proper adjudication of the issue on merits . The A.O. shall thereafter frame the assessment de-novo on merits after considering all the evidences and explanation furnished by the assessee on merits. Needless to say proper and adequate opportunity of being heard shall be provided by the AO to the assessee in accordance with principles of natural justice in accordance with law. - Decided in favour of assessee for statistical purpose.
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2016 (9) TMI 1183
Applicability of section 50 on transfer of building - non-depreciable asset - calculation of short term capital gain against long term capital gain claimed by the appellant - Held that:- In the present case no asset is depreciable asset, hence provisions of section 50 are not applicable and since plot and construction being an investment, for earning rent therefore, for the purpose of calculating long term capital gain indexed cost is to be calculated for both plot as well as structure. - AO directed to calculate long term capital gain on transfer of building as it has been held for a period of more than 36 months - Decided in favour of assessee
Scope of section 50C - transferred the asset through unregistered “Deed of assignment” prior to 1.10.2009 - Held that:- Section 50C was not applicable to the case of the assessee during the relevant period as the sale agreement in question was unregistered document and was not assessed by the stamp valuation authorities. The word “assessable” has been incorporated only w.e.f. 1.10.2009 (Finance Act 2009), therefore, provision of section 50C will not apply on unregistered documents. Hence learned CIT(A) wrongly confirmed the action of the Assessing Officer regarding substitution of full value consideration from ₹ 1200/- per square meter to ₹ 1300/- square meter by applying provisions of section 50C of the Income Tax Act. Even otherwise no opportunity of being heard was granted before switching over from ₹ 1200/- per square meter to ₹ 1300/- per square meter which is even otherwise bad in law and against the principles of natural justice. - Decided in favour of assessee.
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9911796707
