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Case Laws
Showing 161 to 180 of 203 Records
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1981 (2) TMI 43 - MADHYA PRADESH HIGH COURT
Business Income ... ... ... ... ..... ncome derived by the assessee from hiring the air-conditioning equipment was not chargeable as profits and gains of business and was chargeable to tax as income from other sources. On the facts and in the circumstances of the case, we are of the opinion that the income derived by the assessee from hiring the air-conditioning equipment was properly taxable under the head Profits and gains of business . Our answer to question No. referred to us is that, on the facts and in the circumstances of the case, the income received by the assessee from the hiring of the air-conditioning plant should be assessed under the head Business income . Our answer to question No. 2 is that, on the facts and in the circumstances of the case, the assessee is entitled to claim development rebate in respect of the air-conditioning plant under s. 33 of the I.T. Act, 1961. The reference is answered accordingly. In the circumstances of the case, the parties shall bear their own costs of this reference.
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1981 (2) TMI 42 - MADHYA PRADESH HIGH COURT
Capital Asset, Capital Gains ... ... ... ... ..... tion were not the personal effects of the assessee held for personal use of the assessee. On the facts found by the Tribunal, it has to be held that the items of jewellery in question were the personal effects of the assessee held for personal use by her and, therefore, were excluded from the definition of the term capital asset , as defined, by s. 2(14) of the Act and as such the profits and gains arising from the sale thereof were not taxable under the provisions of s. 45 of the Act. In our opinion, therefore, the Tribunal was not justified in law in holding that the heirloom jewellery did not constitute personal effects of the assessee within the meaning of s. 2(14) of the Act, and therefore, the profits and gains arising from the sale of the same were liable to tax under s. 45 of the Act. Our answer, therefore, to the question referred to us is in the affirmative and in favour of the assessee. In the circumstances, the parties shall bear their own costs of this reference.
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1981 (2) TMI 41 - ORISSA HIGH COURT
Business Expenditure ... ... ... ... ..... ITR 761 and in a recent unreported decision in S.J.Cs. Nos. 182 and 183 of 1976 (CIT v. Harish Chandra Gupta) disposed of on February 2, 198 I- since reported in 1981 132 ITR 799 (Orissa) , where the view expressed by the Andhra Pradesh High Court in G. Mohan Rao v. Gundlapalli Satyanarayana 1972 84 ITR 685, has in terms been approved. If the declarations by themselves in the returns were enough evidence of blending, the application of January, 1974, was not open to the construction put by the Commissioner and there was nothing in the application which supported the stand of the of the revenue. We would, accordingly, answer the question referred to us by holding On the facts and in the circumstances of the case, the Tribunal was right in holding that the action of the Commissioner in vacating the orders of the ITO was not justified. Assessee is entitled to costs of these references. Consolidated hearing fee is assessed at rupees two hundred and fifty. B. N. MISRA J.-I agree.
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1981 (2) TMI 40 - DELHI HIGH COURT
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... ... ..... 1 129 ITR 379 (Delhi) . In that case this Bench was concerned not with the question of penalty but with the question of the validity of an assessment. But the argument that was considered, was whether, in view of the decision in Kulu Valley s case 1970 77 ITR 518 (SC), a return filed under s. 139(4) could be equated to a return under s. 139(1). That contention was repelled by the Bench and it was held that the principle of Kulu Valley s case 1970 77 ITR 518 (SC) could not be extended to bring about a total identity between a return under sub-s. (4) and a return under sub-s. (1). These two decisions indirectly touch upon the issue in the present case and proceed on the same lines as we have indicated above. They also, therefore, support the contention of the learned counsel for the department. For the reasons stated above, we answer the question referred to us in the negative and in favour of the department. The department will be entitled to its costs. Counsel s fee, Rs. 300.
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1981 (2) TMI 39 - MADHYA PRADESH HIGH COURT
Reassessment ... ... ... ... ..... oes not give the ITO power to reopen the assessment under s. 147(b) of the Act. But in the instant case the Tribunal has found that it was as a result of information received by the ITO, regarding evasion of tax by the partners of the firm of which the assessee was a partner, that the ITO had reason to believe that the income of the assessee had escaped assessment and that he had accordingly initiated proceedings under s. 147(b) of the Act for reopening the assessment. It was not a case of discovery of an error on a reconsideration of the same material as was present in the original assessment proceedings. In these circumstances, the Tribunal was justified in holding that the proceedings under s. 147(b) of the Act initiated against the assessee, in the instant case, were valid. For all these reasons, our answer to the question referred to us is in the affirmative and against the assessee. In the circumstances of the case, parties shall bear their own costs of this reference.
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1981 (2) TMI 38 - CALCUTTA HIGH COURT
Super Profits Tax ... ... ... ... ..... bt, it would be required to meet an immediate future requirement as proposed by the board of directors which awaited approval in the forthcoming meeting of the shareholders before the relevant date. Therefore, from a commonsense and broad point of view it cannot be considered as a sum available for use in the future by the company in its business. Therefore, in our opinion, the Tribunal was right in excluding the three items, viz., the provision for taxation, provision for gratuity and provision for proposed dividend, in computing the capital base for determination of the standard deduction under r. 2(1) of the Rules of the Second Schedule to the S.P.T. Act, 1963. But the Tribunal was in error in not excluding the additional depreciation reserve of Rs. 6,58,100 in the facts and circumstances of the case. The question is answered in the manner indicated above. In the facts and circumstances of the case parties will pay and bear their own costs. SUDHINDRA MOHAN GUHA J.-I agree.
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1981 (2) TMI 37 - MADHYA PRADESH HIGH COURT
Net Wealth, Wealth Tax ... ... ... ... ..... nature set out in the question was to be deducted from the aggregate assets in arriving at the net wealth of the assessee. The loan was converted into taxable assets out of which the assessee will presumably make profits. The exemption given by section 5(1)(vi) of the Act seems intended to encourage savings by payment towards or investment in insurance policies. If the assessee chooses to withdraw money, directly or indirectly, from the exempted stock of assets, he cannot continue to claim the benefit given by section 5(1) of the Act to stocks of wealth of particular classes. If the assessee repays the loan , the amount so repaid will go back into the exempted stock. But the loan taken by the assessee falls clearly within the purview of section 2(m)(ii) of the Act and it has been converted into assets of a character different from that of any exempted asset. In the result, we answer the question in the negative, that is, in favour of the department and against the assessee.
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1981 (2) TMI 36 - CALCUTTA HIGH COURT
Business Expenditure ... ... ... ... ..... necessary, in our opinion, to express any final conclusion on this aspect of the matter, in the view we have taken on the first aspect of the matter. Before we close, we must also note that the Division Bench of this court expressed certain observations in the case of M. M. Thapar v. CIT 1978 114 ITR 331, where it was held that the interest paid on borrowings utilised for payment of annuity deposit was not liable as deduction under s. 57 of the Act in computing the total income of the assessee. In the view we have taken on the other aspect of the matter, it is not necessary to examine this aspect any further. In that view of the matter and having regard to our view expressed on the first aspect, as we have mentioned before, we cannot uphold the decision of the Tribunal on that ground and answer the question in the negative and in favour of the assessee. In the facts and circumstances of the case, the parties will pay and bear their own costs. SUDHINDRA MOHAN GUHA J.-I agree.
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1981 (2) TMI 35 - DELHI HIGH COURT
Legal Representative ... ... ... ... ..... und to mislead the ITO into either believing that the proceedings were properly constituted or that the assessee was still alive. When reality is obscured by an illusion, mistake is certainly possible and, therefore, the direction made by the AAC would not be out of place, and indeed, was called for. We, are of the view that, the AAC did have the jurisdiction to make the direction and, in the circumstances, the direction cannot be classified as unjustified. In the circumstances, we would answer the question referred to us as follows We would answer the first question in the affirmative, to hold that the AAC could set aside the assessment and issue a direction to frame a proper assessment on the legal heirs of Sri Neecha Ram. As regards the second question, we do not answer the same as the answer is only required if the first question is answered in the negative. As the questions involved in this case are, in a sense, novel, we would leave the parties to bear their own costs.
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1981 (2) TMI 34 - CALCUTTA HIGH COURT
Expenditure Incurred ... ... ... ... ..... R (ED) 8 at p. 11. In a different context, a similar principle was reiterated by the Supreme Court in the case of Jivabhai Purshottam v. Chhagan Karson, AIR 1961 SC 1491 at 1494. But we must observe that these observations were made by the Supreme Court not in the context of the fiscal statute but in the context of a Tenancy Act where certain benefits were intended to be given to the tenant In any view of the matter, having regard to the purpose of the section, as indicated by the heading and having regard to the language used, in our opinion, it is possible to construe the depreciation claimed as expenditure incurred. If such a construction is possible, the assessee is entitled to the benefit of the beneficial construction. In that view of the matter, we are of the opinion that the Tribunal was right in its conclusion and the question is answered in the affirmative and in favour of the assessee. The parties will pay and bear their own costs. SUDHINDRA MOHAN GUHA J.-I agree.
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1981 (2) TMI 33 - CALCUTTA HIGH COURT
Business Expenditure ... ... ... ... ..... roversy. We are not faced with that controversy. In that view of the matter, we are of the opinion that the Tribunal was correct in allowing this deduction. We would, however, say that it is not in all cases correct to say that a statutory liability discharged in particular year become eligible for deduction in the year in question in the mercantile system of accounting. It depends on the facts and circumstances of the case and on the statutory provisions. Here in part the statutory liability admittedly accrued in the year in question and in part became real and enforceable in view of the facts in the year in question though referable to earlier years. But the reality of the situation was that, in substance, the liability accrued in the year in question. In that view of the matter, the decision of the Tribunal is sustained. The question is answered in the manner indicated above and in favour of the assessee. There will be no order as to costs. SUDHINDRA MOHAN GUHA J.-I agree.
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1981 (2) TMI 32 - PUNJAB AND HARYANA HIGH COURT
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... ... ..... question of the concealed income was also not assailed. What was urged was that there being no definite evidence regarding the concealed income and the same having been arrived at by the process of assessment of profits at a particular rate, the finding recorded during the assessment proceedings in this respect would not furnish adequate ground for imposing penalty on its basis. We do not find any merit in this contention. The finding recorded in the assessment proceedings as held in Anwar Ali s case 1970 76 ITR 696 (SC) is certainly relevant in the assessment proceedings. Moreover, the finding recorded in the present case cannot be said to be without any oasis because the amount of the sale proceeds is not in dispute and, in the absence of the trading account, the authorities were fully justified in estimating the profits on a percentage basis. Consequently, the third question is also answered in the affirmative, against the assessee and in favour of the revenue. No costs.
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1981 (2) TMI 31 - MADHYA PRADESH HIGH COURT
Business Expenditure, Disallowance ... ... ... ... ..... ered by the assessee to him. In fact the position is exactly the reverse. The commission was paid by the assessee to Santosh Kumar for services rendered by him to the assessee and, therefore, the provisions of the above rule relied upon by the learned counsel for the assessee are not applicable to the present case. In view of the finding of the Tribunal that payments in cash exceeding Rs. 2,500 to the extent of Rs. 16,400 were made by the assessee and the assessee failed to prove that the said payments in cash were made in exceptional or unavoidable circumstances, the Tribunal had not committed any error of law in confirming the disallowance of the said amount of Rs. 16,400 paid in cash by the assessee to Shri Santosh Kumar under s. 40A(3) of the Act. As a result of, the discussion aforesaid, our answer to the question referred to us by the Tribunal is in the affirmative and against the assessee. In the circumstances, the parties shall bear their own costs of this reference.
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1981 (2) TMI 30 - GUJARAT HIGH COURT
Reassessment ... ... ... ... ..... n, has issued a notice under s. 148 of the I.T. Act purely because he came to a different conclusion regarding the effect of these interpolations and overwriting. On the same materials change of opinion cannot form the basis of a notice under s. 148 so far as proceedings for the reopening of an assessment under s. 147 of the I.T. Act are concerned. Under these circumstances, the respondent was acting without jurisdiction when he issued the notice under s. 148 of the Act merely because he formed, a different opinion than his predecessor who passed the order under s. 143(3) of the I.T. Act, 1961. Under these circumstances, the notice under s. 148 of the Act, being Ex. F to the petition, is quashed and set aside and the respondent is directed to cease from proceeding further against the petitioner in pursuance of the said notice dated October 4, 1980, Ex. F to the petition. Rule made absolute accordingly. The respondent must pay the costs of these proceedings to the petitioner.
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1981 (2) TMI 29 - CALCUTTA HIGH COURT
Business Expenditure ... ... ... ... ..... ut there, in our opinion the Full Bench of the Allahabad High Court, with very great respect, was in slight error because the interest is not for an infraction of law as such but it is for the default in time which is kind of damage in default in the performance of an obligation. In that view of the matter, in our opinion, the provisions of these two Acts are in pari materia. Therefore, the ratio of the decision of the Supreme Court in the case of Mahalakshmi Sugar Mills Co. 1980 123 ITR 429 would be applicable in the facts and circumstances of the case it that is the position in law, the sums were deductible, then the Commissioner was obviously in error in the view he took. In the aforesaid view of the matter, we will answer the first question in the negative and as a consequence the second question must also be answered in the negative. Both the questions are answered in favour of the assessee. The parties will pay and bear their own costs. SUDHINDRA MOHAN GUHA J.-I agree.
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1981 (2) TMI 28 - MADHYA PRADESH HIGH COURT
Business Expenditure ... ... ... ... ..... IT 1961 41 ITR 350 (SC), no expense which is paid by way of penalty for a breach of the law can be said to be for the business of the assessee . The question as to whether the breach of law involves moral turpitude or only violation of some technical provision, which according to the Tribunal is vital, is not, in our opinion, decisive of the question as to whether the amount is an allowable expenditure under s. 37(1) of the Act. In the case of expenses incurred on account of the penalty levied for a breach of the law, the penalty is, as observed in IRC v. Alexander von Glehn and Co. Ltd. 1920 2 KB 553 (CA), imposed on the assessee personally and the expenses incurred in that behalf cannot be held to be laid out wholly and exclusively for the purpose of the business of the assessee. For all these reasons, our answer to the question referred to us is in the negative and against the assessee. In the circumstances of the case, parties shall bear their own costs of this reference.
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1981 (2) TMI 27 - GUJARAT HIGH COURT
Bad Debt, Business Loss ... ... ... ... ..... arrying out the operation of the business. vide CIT v. Nainital Bank Ltd. 1965 55 ITR 707 (SC) . In that view of the matter, therefore, for the reasons stated in this order, we, are of the opinion that the said loss being a bad debt is allowable as trading loss under s. 28 of the I.T. Act, 1961, and, therefore, for the reasons stated hereinabove, the answer to the question referred to us is in the affirmative, that is, in favour of the assessee and against the revenue. The question referred to us at the behest of the assessee, therefore, need not be answered as conceded by the learned advocate for the assessee. The result is that the question referred to us at the instance of the revenue is answered in the affirmative, that is, against the revenue and in favour of the assessee, while the question referred to us at the behest of the assessee does not survive and, therefore, does not require to be answered. The Commissioner shall pay the costs of this reference to the assessee.
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1981 (2) TMI 26 - CALCUTTA HIGH COURT
Deduction, Total Income ... ... ... ... ..... f Cambay Electric Supply Industrial Co. Ltd. 1978 113 ITR 84 of th Supreme Court was a decision rendered by two learned judges. Our attention was also drawn to another decision of the Supreme Court in the case of CIT v. Patiala Flour Mills Co. Ltd. 1978 115 ITR 640. Our attention was also drawn to the decision of the Supreme Court in the case of CIT v. S. S. Sivan Pillai 1970 77 ITR 354. Though the aforesaid decisions dealt with different sections the ratio of the said decisions are in consonance with the views we are taking in this case it appears, however, that the attention of the Supreme Court was not drawn to the last two mentioned cases. In the view we have taken for the reasons mentioned hereinbefore, we are of the opinion that the Tribunal was right in its conclusion and the question must be answered in the affirmative and in favour of the assessee. In the facts and circumstances of the case, parties will pay and bear their own costs. SUDHINDRA MOHAN GUHA J.-I agree.
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1981 (2) TMI 25 - DELHI HIGH COURT
Notice, Penalty, Self-Assessment, Service By Post ... ... ... ... ..... er should be sent by registered post. In the present cases, as noticed above, the reminders were issued under certificate of posting and not by registered post. It would, therefore, appear to us that there is nothing on the record to indicate that proper and valid service was, in fact, effected nor can any presumption be drawn. We also feel that not much importance can be attached to the non-filing of an affidavit by the assessees as the AAC accepted their version without an affidavit. Once their statement with regard to non-service had been accepted by the AAC and no affidavit had been asked for thereafter at the stage of the Tribunal, we think that the lack of an affidavit is not material. We are, therefore, of the opinion that the assessees were not given the requisite hearing to which they were entitled. In the result, both the questions are answered in the negative and in favour of the assessees. The assessees will be entitled to costs. Counsel s fee Rs. 200 in one set.
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1981 (2) TMI 24 - DELHI HIGH COURT
New Industrial Undertaking, Reconstruction, Splitting Up ... ... ... ... ..... nclusion that it is a reconstruction. In fact, the contention of the learned counsel for the Revenue that the transfer even to an insignificant extent of assets by way of machinery and plant from the old to the new undertaking will result in reconstruction may render cl. (ii) completely otiose. In our opinion, therefore, cl. (i) cannot be construed in such way. The concept of reconstruction should be looked at from a substantial point of view and for the reasons already stated the present case cannot be said to be one of reconstruction. We, therefore, answer the reference by saying that the assessee-company satisfied all the conditions laid down in sub-s. (2) of s. 84 of the I.T. Act, 1961, and is, therefore, entitled to the exemption contemplated in s. 84(1) of the Act. The same answer is given to the questions referred to us in the other two matters as well. As the assessee has succeeded, it will be entitled to the costs of these references. Counsel s fee (one set) Rs.500.
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