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Showing 281 to 300 of 359 Records
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1991 (3) TMI 79 - KERALA HIGH COURT
Accounting, Income ... ... ... ... ..... . The Commissioner has rightly held that the amount should have been excluded from the total income of the year under consideration. The Appellate Tribunal, while concurring with the order of the Commissioner of Income-tax.(Appeals), observed that the price of drugs supplied by the assessee-company to the Health Service Department was only tentative, but was not fixed by contract or otherwise. The entries made in the accounts represented only mere claims and did not represent any accrued income or income received. It was for these reasons that the Tribunal agreed with the view of the Commissioner of Income-tax (Appeals). No error of law has been committed by the Appellate Tribunal. The question referred to us for decision is, therefore, answered in the affirmative, i.e., in favour of the assessee and against the Revenue. A copy of this judgment under the seal of the court and the signature of the Registrar will be forwarded to the Income-tax Appellate Tribunal, Cochin Bench.
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1991 (3) TMI 78 - ALLAHABAD HIGH COURT
Income From Undisclosed Sources ... ... ... ... ..... rought to the notice of the Commissioner that the portion purchased by him was under the tenancy of his mother and actually they were themselves occupying it. This may be a reason for selling the house at a rate lesser than fair market value or it may not be but that is question of fact. It is true that the Income-tax Officer had observed that the petitioner had not placed any material before him in the circumstances of the case, but he seems to have omitted to notice that the purchased premises were under the tenancy of the assessee s mother and the assessee s family was said to be occupying it. In the circumstances, the orders of all the three authorities are quashed and the matter is remitted to the Income-tax Officer for redetermination of the actual consideration which was paid by the assessee in the said transaction afresh in the light of the observations made above. The assessment may be finalised accordingly. The writ petition is allowed in the above terms. No costs.
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1991 (3) TMI 77 - ALLAHABAD HIGH COURT
... ... ... ... ..... en donations put forward by the assessee, five are accepted and five are rejected. The Tribunal has said that merely because the evidence in respect of five donations was not accepted or believed, it does not follow that there was gross fraud or wilful neglect, even though this is a case of penalty proceedings under section 271(1)(c) of the Income-tax Act. We do not think that a question of law arises from the order of the Tribunal as it has recorded a finding that there was no proof of wilful or fraudulent concealment. The application is accordingly rejected.
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1991 (3) TMI 76 - MADHYA PRADESH HIGH COURT
Actual Cost, Depreciation ... ... ... ... ..... pply the decision of the Madhya Pradesh High Court in the case of CIT v. Bhandari Capacitors Pvt. Ltd. 1987 168 ITR 647 by which the Hon ble High Court had held that the amount of capital subsidy is not deductible from the actual cost of the assets for the purpose of allowing depreciation ? An application under section 256(1) of the Income-tax Act was moved before the Tribunal which rejected it following the decision of this court in CIT v. Bhandari Capacitors P. Ltd. 1987 168 ITR 647. A Division Bench of this court in CWT v. Smt. Usha Devi 1990 183 ITR 75 has held that where the Tribunal has passed an order following the decision of the High court in another case, the court would be justified in rejecting an application under section 256 (2) and pendency of the point before the Supreme Court is no ground for allowing the application. In view of the aforesaid decision, no referable question survives before us. The application is, therefore, rejected with no order as to costs.
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1991 (3) TMI 75 - ALLAHABAD HIGH COURT
Charitable Trust, Exemptions ... ... ... ... ..... circumstances of the case, the Tribunal was right in holding that the assessee-trust which has registered under section 12A and exempt under section 80G in earlier year but, if the expenditure is not on charitable objects in the subsequent years, could be granted exemption under section 11 ? In our opinion, however, it is enough if question No. 1 is referred. Question No. 2 merely relates to one of the reasons in support of the finding of the Tribunal and need not be referred as such. Accordingly, the Tribunal is directed to state question No. 1 of the two questions mentioned above under section 256(2) of the Income-tax Act. The application is allowed accordingly in part. No costs.
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1991 (3) TMI 74 - KARNATAKA HIGH COURT
Best Judgment Assessment ... ... ... ... ..... nded that the assessee could have invoked section 146 of the Act and his failure to do so read with the circumstance that no explanation is forthcoming for the delayed production of the assessment order disentitles the assessee to any equitable considerations. This approach is acceptable only in case the best judgment assessment is to be understood as a penal provision, enacted to penalise a defaulting assessee. The Revenue must act fairly in the matter of assessment as much as it is interested in collecting the tax. In the absence of any prejudice to the Revenue, and the basis of tax under the Act being to levy tax, as far as possible, on the real income, the approach should be liberal in applying the procedural provisions of the Act. An appeal is but a continuation of the original proceeding and what the Income-tax Officer could have done, the appellate authority also could do. Therefore, our answer to the question referred is in the negative and in favour of the assessee.
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1991 (3) TMI 73 - ALLAHABAD HIGH COURT
Business Expenditure, Disallowance, Expenditure ... ... ... ... ..... rred by an assessee. Normally, payment under a crossed cheque or crossed bank draft is an assurance of its, genuineness. It obviates an inquiry into doubtful payment. The provision is intended to introduce openness in business transactions. Having regard to this underlying object, we see no reason to restrict the meaning of the expression expenditure to deductions provided by sections 28 to 43A alone. The emphasis is upon the word expenditure and not upon the word deduction , as would be evident from a reading of the sub-section. The rule applies to all expenditure claimed and certainly the money spent for purchasing stock-in-trade is claimed as deduction out of the trading receipts with a view to arrive at the gross profit. For the above reasons, we see no reason to doubt the correctness of the Bench judgment of this court or to take a different view. The question is, accordingly, answered in the affirmative, i.e., in favour of the Revenue and against the assessee. No costs.
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1991 (3) TMI 72 - KARNATAKA HIGH COURT
Investment Allowance, Plant ... ... ... ... ..... e well was held to be plant . In the decision of the Calcutta High Court in CIT v. Hindusthan Motors Ltd. 1988 170 ITR 431, a tube-well was treated as plant . It was held that it is an apparatus with equipment necessary for drawing water for the purpose of industrial production and for the labour. These two decisions of the Andhra Pradesh High Court and of the Calcutta High Court indicate that an object or a thing which is beneficial to the carrying on of the business of the assessee to earn taxable income could be treated as plant . With respect, we entirely agree with this approach. In the instant case, the assessee is carrying on the business of producing oil. A storage tank is absolutely necessary for the activities of the assessee. In these circumstances, the Appellate Tribunal was fully justified in upholding the claim of the assessee and treating the storage tank as plant . Consequently, the answer to the question referred is in the affirmative and against the Revenue.
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1991 (3) TMI 71 - ALLAHABAD HIGH COURT
Charitable Institution ... ... ... ... ..... of Uttar Pradesh v. CIT 1983 143 ITR 584, wherein it has been held that the Bar Council of Uttar Pradesh is a charitable institution since its purposes are charitable purposes with the meaning of section 2(15) of the Income-tax Act. Once it is held that it is a charitable institution, sections 11 to 13 of the Income-tax Act get attracted and it is evident that its case will be dealt with under these provisions. By saying so, however, we may not be understood as holding that the Bar Council is not entitled to the benefits of section 10(23A) of the Act in respect of its income derived from sale of forms and other miscellaneous receipts which benefit has already been granted to it in pursuance of the aforesaid judgment of this court. For the above reasons, we decline to answer the questions referred. We return the references to the Tribunal unanswered. The Tribunal shall pass final orders under section 260 of the Act in the light of the judgment of this court referred to above.
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1991 (3) TMI 70 - KARNATAKA HIGH COURT
Advertisement, Publicity And Sales Promotion, Business Expenditure, Disallowance, Surtax ... ... ... ... ..... er an appropriate head in the return. Subsequently, the assessee sent a letter modifying the original return of income and offered to confine the claim under this head to a part of the expenditure. Learned counsel for the Revenue is justified in pointing out the above circumstance as an additional factor in support of the conclusion arrived at by the Appellate Tribunal. Each of the three words advertisement, publicity and sales promotion cannot always be confined to distinct and different concepts. Some aspects of one word would naturally overlap with the meaning attributed to the other word. No doubt, in a commercial sense, the purpose of these activities is to gain goodwill and a market but the mode of achieving this object cannot be confined to the limited meaning attributed to them by learned counsel for the assessee. For the reasons stated above, the second question referred to us is answered in the affirmative and against the assessee. Reference is answered accordingly.
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1991 (3) TMI 69 - ALLAHABAD HIGH COURT
Income, Interest On Borrowed Capital ... ... ... ... ..... said loans. The Income-tax Officer, however, found that, out of the moneys so borrowed from the bank, a substantial portion was lent to the directors free of interest. Similar loans were also extended to a firm in which the directors of the assessee were interested. The Income-tax Officer was of the opinion that the interest relatable to the amount lent to the directors and to the said firm cannot be granted deduction, because it cannot be said that money to that extent was borrowed for the purpose of the said company. We find from the statement of the facts and the order of the Tribunal that the amounts advanced to the directors and their firm, free of interest, are quite substantial and that it was a continuing course of conduct and not an isolated transaction. In such circumstances, the principle of the said decision clearly applies. Following the same, we answer question No. 2 in the negative, i.e., against the assessee and in favour of the Revenue. No order as to costs.
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1991 (3) TMI 68 - ALLAHABAD HIGH COURT
Developement Rebate, Proprietory Business Converted To Partnership, Transfer ... ... ... ... ..... or the purposes of that head. The implications of this definition are dealt with post under sections 45 and 47 which deal with capital gains. We are unable to see how the above passage advances the case of the petitioner. Indubitably, the plant and machinery which was transferred by the assessee to the partnership do constitute capital assets. For the above reasons, the question referred is answered in the affirmative, i.e., in favour of the Revenue and against the assessee. No order as to costs. Learned counsel for the assessee makes an oral request for certifying this case to be a fit one for appeal to the Supreme Court under section 261 of the Act. It is also brought to our notice that the Andhra Pradesh High Court has granted leave to appeal against its judgment in CIT v. Suresh Chandra Jain 1989 178 ITR 241. In our opinion, this is a fit case for being certified as fit for appeal to the Supreme Court under section 261 of the Act. A certificate shall, accordingly, issue.
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1991 (3) TMI 67 - KARNATAKA HIGH COURT
Actual Cost, Bonus, Business Expenditure, Depreciation, Foreign Exchange, Investment Allowance
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1991 (3) TMI 66 - BOMBAY HIGH COURT
Advance Tax, Appeal To AAC ... ... ... ... ..... pecifically so stated. The Tribunal, to say the least, has not disturbed that finding. Having regard to the principle of construction that the provision for appeal should be liberally construed, we would like to proceed on the basis that this is an order passed by the Income-tax Officer under section 154 of the Act. That being so, our court s judgment in the case of CIT v. S. C. Shah 1982 137 ITR 287, is squarely applicable and the question requires to be answered in favour of the assessee. In the view we have taken about the competence of the appeal under section 246(1)(f), we do not think it necessary to examine and finally express our views on the other question, namely, whether the appeal will or will not also be competent under section 246(1)(c) or under section 246(1)(e) or under sub-section (1)(n) of section 246 against the order under section 237 of the Act. The question is, accordingly, answered in the affirmative and in favour of the assessee. No order as to costs.
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1991 (3) TMI 65 - DELHI HIGH COURT
Application By Commissioner ... ... ... ... ..... hereafter, the Commissioner of Income-tax had filed an application under section 256(2) and it was contended by the assessee that the date of service on the Chief Commissioner would be the starting point of limitation. On a correct interpretation of section 256(2), which is in pari materia with the provisions of section 256(1), we came to the conclusion, vide our order dated January 24, 1991, that what was material was the service on the Commissioner of Income-tax concerned and not service on the Chief Commissioner. It is the Commissioner of Income-tax alone who has the jurisdiction to file an application either under section 256(1)or under section 256(2) and, therefore, it is imperative that it is he who should be served with a copy of the order under section 254 or under section 256(1), as the case may be, for the purpose of computing the period of limitation. For the aforesaid reasons, we do not find any merit in this writ petition and the same is, accordingly, dismissed.
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1991 (3) TMI 64 - ALLAHABAD HIGH COURT
Income From Undisclosed Sources ... ... ... ... ..... identity established. The ultimate finding of the Tribunal is that Indian Wool Traders was only a convenient facade . It is contended by learned counsel for the petitioner-assessee that where a payment is made by a crossed cheque, it is itself a proof positive of the genuineness and identity of the recipient. We cannot accept or recognise any such rule of law. Whether a particular entity or concern is genuine and existing entity/concern or merely a bogus name, is a question of fact and it cannot be reduced to a rule of law. Here, all the three authorities have held against the assessee and we see no reason to disturb the said finding of fact. Accordingly, questions No. 1 to 5 cannot be directed to be stated. So far as question No. 6 is concerned, it is really academic in view of the finding as to the genuineness of the said entity. This is also the view taken by the Tribunal in the application filed under section 256(1) of the Act. The application is, accordingly, dismissed.
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1991 (3) TMI 63 - BOMBAY HIGH COURT
Business Expenditure, Export Market Development Allowance, Perquisite, Weighted Deduction ... ... ... ... ..... ground. The admitted position is that the expenditure in question has been incurred on maintaining a branch shop at Bodnia, London. That branch was opened for the purpose of facilitating the export of cloth by the assessee outside India. The nature of the expenditure has already been referred to by us above. It is insurance on the stock of cloth in the shop and interest on bank overdraft, both abroad. Section 35B(1)(b)(iv) clearly provides for allowance of weighted deduction under section 35B in respect of expenditure on maintenance outside India of a branch, shop or agency for the promotion of the sale outside India of such goods, services or facilities. In our view, the Tribunal was wholly right in agreeing with the Appellate Assistant Commissioner that the nature of the expenditure was such that it clearly fell within this clause. Accordingly, agreeing with the Tribunal, we answer the second question in the affirmative and in favour of the assessee. No order as to costs.
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1991 (3) TMI 62 - ALLAHABAD HIGH COURT
New Industrial Undertaking, Special Deduction ... ... ... ... ..... ase of this very assessee, the Supreme Court, in Lohia Machines Ltd. v. CIT 1985 152 ITR 308, held that borrowed capital cannot be taken into consideration and cannot be included in the assessee s capital for working out the deduction provided under section 80J of the Income-tax Act. Following that decision, the question referred is answered in the negative, i.e., in favour of the Revenue and against the assessee.
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1991 (3) TMI 61 - BOMBAY HIGH COURT
... ... ... ... ..... A question arose as to whether, in the year in which the dividend had been declared and distributed, they were assessable as income in the hands of the shareholders. Since the extraordinary resolution by which the dividends declared were directed to be treated as loans was passed long after the end of the previous year in that case., that case is distinguishable. We would like to make it clear that we are concerned in this case with a situation where the declaration of dividend as a matter of fact as well as the change in the legal position to the effect that it could not have been declared as dividend have happened during one and the same previous year. Section 8(a), which has been referred to above, in our judgment, clearly contemplates a situation where a dividend declared has become invalid during the course of the previous year itself. Accordingly, we answer the question referred to us in the affirmative and in favour of the assessee. There will be no order as to costs.
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1991 (3) TMI 60 - BOMBAY HIGH COURT
Appeal To AAC ... ... ... ... ..... However, we need not pursue this aspect in this reference. The decision in Addl. CIT v. Mustakhusein Gulamhusein Ghia 1983 143 ITR 951 (Bom), does not appear to us to really help the assessee. However, in CIT v. B. V. Sabunani 1989 177 ITR 56, our court has referred to and applied the Full Bench judgment of our court in CIT v. Daimler Benz A. G. 1977 108 ITR 961 and held that if the total income is reduced as a result of the appellate orders, it could not be denied that liability to be assessed to tax including interest under section 139(1) was to some extent disputed. The appeal against levy of interest under section 139(1) was held to be competent. This decision covers the issue in the present case. In view of the decision in CIT v. B. V. Sabunani 1989 177 ITR 56 (Bom), we are in agreement with the Tribunal that the appeal was competent. Accordingly, we answer the question referred to us by the Tribunal in the affirmative and in favour of the assessee. No order as to costs.
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