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Income Tax - Case Laws
Showing 101 to 120 of 192 Records
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2005 (2) TMI 111
Exception covered by the proviso, clause (c) to sub-section (5) of section 43 - onus of proof - Supreme Court dismissed appeal agreeing with the High Court that assessee was entitled to the exception covered by the proviso, clause (c) to sub-section (5) of section 43 of the Income-tax Act. The onus of proof was on the Department to establish that such exception was not applicable and no question of law was required to be referred albeit for reasons other than the reason expressed by the High Court.
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2005 (2) TMI 109
Business Expenditure ... ... ... ... ..... l year 1978-79 relevant to the assessment year 1979-80. The liability to pay the excess amount of 0.5 per cent. arose on July 31, 1979, when the Supreme Court decided the matter. These facts have also been noticed by us in CIT v. Sohan Lal Kharait Ram 2007 290 ITR 694 (P and H), ITR No. 29 of 1987, decided by us on February 8, 2005. From the aforesaid factual position, it is quite clear that there was no liability to pay market fee beyond 1.5 per cent. during the financial year 1978-79. Thus, it has been rightly held that the assessee was not entitled to claim deduction of Rs. 95,382.05 towards market fee due as on March 31, 1979. Following our order in CIT v. Sohan Lal Kharait Ram 2007 290 ITR 694 (P and H), we are of the opinion that the Appellate Tribunal was justified in upholding the disallowance of liability or market fee in excess of 1.5 per cent. In view of the above, the question is answered in the affirmative, i.e., against the assessee and in favour of the Revenue.
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2005 (2) TMI 108
Year In Which Allowable ... ... ... ... ..... e insurance company and since according to the learned Commissioner of Income-tax (Appeals) it was a trading loss. The assessee was entitled to claim this loss in the year under consideration and, hence, allowed the relief. When the matter came up in appeal before the Tribunal, the Tribunal considered the contentions of both the sides, the authorities cited and came to the conclusion that there is no justification either according to the principles of accountancy or on the basis of law, in not writing off these stocks which were destroyed not claiming this loss in the assessment year 1978-79 when the actual loss had taken place. This conclusion was arrived at after considering not only the submissions of the rival parties but the authorities of the various courts recorded in paras 4 and 5 of the order of the Tribunal. The finding of the Tribunal is prima facie a finding of fact. However, in the absence of any assistance from the assessee the reference is returned unanswered.
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2005 (2) TMI 107
Unaccounted Income ... ... ... ... ..... , the same was declined and the appeals were disposed of by common order on January 24, 2002. Then a petition M.P. 53/Coch/02 was preferred to set aside the order passed and to give an opportunity of hearing to the applicant, the same was rejected by the Tribunal by order dated February 7, 2003. We have perused the order and we find no illegality. On the merits also we find no reason to interfere with the order passed by the assessing authority which in our view has taken a very practical and reasonable approach. There are sufficient reasons for such categorisation. The Assessing Officer after scrutinising the documents has come to the conclusion that the sale price of Rs. 1,750 per cent stated by the assessee was not the real sale price and the sale price was fixed at Rs. 4,000 per cent. The said fixation of land value is based on relevant materials. We therefore find no reason to interfere with the order passed by the Appellate Tribunal. The appeal is accordingly dismissed.
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2005 (2) TMI 106
Delay In Filing Return ... ... ... ... ..... proviso to section 139(1) had held that interest becomes payable only if the Income-tax Officer, acting on the application made by the assessee for the purpose, had extended the date of furnishing the return. However, after the amendment, the Assessing Officer does not have any discretion in the matter of levy of interest under section 139(8) of the Act which is automatic on the return being filed late. The two authorities cited by the counsel for the Revenue support this proposition. In view of the above, we are of the view that the Tribunal was not justified in cancelling the penalty merely on the ground that the interest under section 139(8) of the Act had already been levied. The question is, therefore, answered in the negative, i.e., in favour of the Revenue and against the assessee. However, since the Tribunal has not gone into the other questions raised before it, the matter shall now be decided by it afresh by disposing of other questions raised before it. No costs.
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2005 (2) TMI 105
Capital Gains ... ... ... ... ..... the extinguishment of rights independent of or otherwise than on account of transfer. To so read the expression is to render it ineffective and its use meaningless. As we read it, therefore, the expression does include the extinguishment of rights in a capital asset independent of and otherwise than on account of transfer. In view of the foregoing discussion, we answer the question referred to us in favour of the Commissioner of Income-tax (Revenue) and against the assessee. In other words, we answer the question by holding that the Tribunal was not justified in holding the amount of Rs. 7,34,000 as capital receipt not exigible to capital gains tax as no transfer of any property was involved within the meaning of section 2(47) of the Income-tax Act. Instead, we hold by answering the question that the amount of Rs. 7,34,000 is a capital receipt exigible to capital gains tax as it involved transfer of property within the meaning of section 2(47) of the Income-tax Act. No costs.
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2005 (2) TMI 104
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... ... ..... hander and Rajesh Kumar. The partial partition claims were accepted by the Income-tax Officer but he treated the groups as tenants-in-common and 50 per cent. of the income arising from the assets under partition were included in the hands of the income of the assessee rejecting the claim of the income representing that of this smaller Hindu undivided family. The Tribunal has upheld the claim of the partial partition accepted by the Deputy Commissioner of Income-tax (Appeals). We have heard Sri A.N. Mahajan, learned standing counsel for the Revenue. Shri P.K. Jain has filed his appearance on behalf of the respondent-assessee. We find that this court in the case of CIT v. Shrawan Kumar Swarup and Sons 1998 232 ITR 123 has in similar circumstances upheld the claim of partial partition between various groups. We accordingly answer the question referred to us in the affirmative, i.e., in favour of the assessee and against the Revenue. However, there shall be no order as to costs.
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2005 (2) TMI 103
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... ... ..... deposit and added the same under section 68 of the Act. So far as the remaining deposits are concerned, there was no transaction between the depositors and the respondent-assessee. This court in Income-tax Reference No. 226 of 1998, Bhaiyalal Shyam Behari v. CIT 2005 276 ITR 38 decided on January 19, 2005, has held that the principle of peak credit is not applicable in case where the deposits remained unexplained under section 68 of the Act. It cannot apply in a case of different depositors where there has been no transaction of deposits and its repayment between a particular depositor and the assessee. Respectfully following the aforesaid decision, we are of the considered opinion that the Tribunal was not justified in directing the Assessing Officer to take the peak credit for the purposes of section 68 of the Act. We accordingly answer the question referred to us in the negative, i.e., in favour of the Revenue and against the assessee. There shall be no order as to costs.
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2005 (2) TMI 102
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... ... ..... oes not give rise to any presumption that the entire crop received in that previous year is assessed. In other words, the scheme of payment of tax under section 13(1) only provides for discharge of liability for that assessment year for which option is exercised and it does not interfere with regular assessment for a subsequent year, under section 39 based on the system of accounting followed by the assessee. Even when the assessee switches over to regular assessment, the assessment has to be made in accordance with the system of accounting followed by the assessee in terms of section 40(1) of the Act. Therefore, the opening stock held as on the first day of the previous year relevant to the assessment year 2001-02 and sold in the same previous year is rightly assessed by the officer by reopening the assessment originally completed wrongly. We, therefore, answer the questions reframed above against the assessee and dismiss the revision case filed under section 78 of the Act.
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2005 (2) TMI 101
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... ... ..... the one that fell for consideration before the Supreme Court in P. L. Karuppan Chettiar 1992 191 ITR 646 are identical in nature and hence it is not necessary for us to take note of any facts in detail for examining the question which stood answered by the apex court thereby settling the controversy so far as legal debate is concerned. This court as also all the courts in the country including the taxing authorities are required to simply follow the law laid down by the Supreme Court in letter and spirit keeping in view the mandate of the article 141 of the Constitution of India and give effect to it in the case of the assessee as a consequential one. Accordingly and in view of the aforesaid and in the light of the law laid down by their Lordships of the Supreme Court in the case of P. L. Karuppan Chettiar 1992 191 ITR 646, we answer the question referred to us as mentioned above against the assessee and in favour of the Revenue i.e., the Commissioner of Income-tax. No cost.
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2005 (2) TMI 100
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... ... ..... s but the Commissioner of Income-tax (Appeals) and the Tribunal held it to be a business income. It is against this finding of the Tribunal, the Commissioner of Income-tax has come up in appeal under se 260A of the Act. We concur with the factual finding recorded by the Tribunal. Admittedly, the assessee is a company engaged in the business of investment shares/securities/debentures. The object of the company also clearly show this. In this view of the matter any income derived from sale/purchase shares whether quoted in the stock exchange or unquoted has to be held a business income or one may say income from business and not an income from other sources for the purpose of computation. In view of the view taken by the taxing authorities, i.e., the Commissioner of Income-tax (Appeals) and the Tribunal cannot be faulted. It is liable to be upheld being in accordance with the object of the company. Accordingly, the appeal is held to have no substance. It is dismissed in limine.
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2005 (2) TMI 99
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... ... ..... y moral obliquity the result will be the same. Even in such cases, deduction will not be permitted of the amounts paid as penalty or fine or of the value of the goods confiscated by the statutory authority as expenditure wholly and exclusively incurred for the purposes of carrying on the trade. It has been consistently held by the English courts that fines or penalties payable for violation of law cannot be permitted as deduction under the Income-tax Act. That will be against public policy. Even though the need for making such payments arose out of trading operation the payments were not wholly and exclusively for the purpose of the trade. One can carry on his trade without violating the law. In fact, section 37 presumes that the trade will be carried on lawfully. The question referred to the court is, therefore, answered in the negative, i.e., in favour of the Revenue and against the assessee. The reference stands disposed of accordingly. There shall be no order as to costs.
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2005 (2) TMI 98
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... ... ..... ed of the matter and upheld the levy of market fee at 2 per cent. instead of 3 per cent. Thus the liability to pay the balance market fee at 0.5 per cent. pertaining to the financial year 1978-79 arose on July 31, 1979. The amount of Rs. 35,129 is on account of this liability. It is, therefore, evident that the liability to pay the amount of Rs. 35,129 arose when the Supreme Court decided the matter on July 31, 1979. Prior to that date, there was no liability to pay market fee in excess of 1.5 per cent. Since the liability arose on July 31, 1979, which date fell within the accounting year 1979-80 relevant to the assessment year under consideration, i.e., 1980-81, the Tribunal was justified in allowing the deduction of this amount on the basis of the mercantile system of accountancy. We, therefore, do not find any infirmity in the finding of the Tribunal. In view of the above, the question is answered in the affirmative, i.e., in favour of the assessee and against the Revenue.
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2005 (2) TMI 96
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... ... ..... at it supports his version. We are afraid, it is not so possible. It is again going into the area of evidence and that too oral. We do not consider it possible to go into such refined way of appreciation of oral evidence for upsetting the factual finding of fact in our second appellate jurisdiction under section 260A, nor are we prepared to accept the submission of learned counsel for the appellant that what is not taken note of has resulted in vitiating the finding impugned. In our view, the Tribunal has taken into consideration all relevant facts, evidence and has recorded the factual finding calling for no interference. A wrong finding on fact cannot be said to involve any question of law unless it is extremely perverse. Such does not appear to be the case though learned counsel urged it to be so with vehemence. In the totality of the whole factual scenario, we are unable to notice any substantial question of law in appeal. The appeal thus fails and is dismissed in limine.
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2005 (2) TMI 95
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... ... ..... bove observations. In this case, as no proceeding in regard to the assessment year 1990-91 was pending before him on November 29, 1989, obviously he could not have issued the commission under section 131(1)(d). The third question is answered accordingly in the affirmative. Re. Question No. (4) In view of our answer to question No. (3), it follows that issue of a commission by the Assessing Officer on November 29, 1989, prior to the initiation of the assessment proceedings relating to the assessment year 1990-91 was not valid and consequently, the valuation report of the DVO received in pursuance of the invalid commission cannot be made use of. If the same is excluded, what was available was the valuation report of the approved valuer which showed the value of the commercial complex as Rs. 8,50,000 as against Rs. 8,00,000 declared by the assessee and the other two owners. Therefore, question No. (4) is also answered in the affirmative. The reference is disposed of accordingly.
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2005 (2) TMI 94
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... ... ..... s must show that the assessee is having an intention to conceal the income and to evade the payment of tax. In this case the assessee showed the payment of Rs. 12 lakhs to the licensor in the return filed by the assessee and the same is not disputed by the Revenue. Though the Revenue refuses to accept the claim of the assessee and added the same for tax it will not automatically lead to a circumstance to levy the penalty. The law laid down by the apex court in K. P. Madhusudhanan v. CIT 2001 251 ITR 99, has no application to the facts of this case. This decision of the apex court is subsequent to the amendment of section 271(1)(c) Explanation 1(B). In the case on hand, the assessment year is 1980-81. The amendment to section 271(1)(c) was in the year 1986. The judgment of the apex court has no application to the facts of this case. For the reasons stated above, the questions of law referred to us are answered in the negative and in favour of the assessee. Ordered accordingly.
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2005 (2) TMI 93
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... ... ..... assessee for non-inclusion of an income of Rs. 2,01,000 in his return of income is not bona fide. The explanation offered by the assessee is available on record. Bona fide failure on the part of the assessee in not substantiating his claim is also available on record. The Income-tax Officer, while passing the order of penalty under section 271(1)(c) of the Act, has not considered the available explanation of the assessee and whether the explanation so offered is bona fide or not. The Tribunal, by considering these facts, concluded that the levy of penalty by the Income-tax Officer and the confirmation of the same by the Commissioner of Income-tax (Appeals) is not just and proper and set aside the same. The order of the Tribunal in setting aside the penalty proceedings on the basis of the material on record, in our opinion, is just and proper. For the reasons stated, the question of law referred to us is answered in the affirmative and against the Revenue. Ordered accordingly.
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2005 (2) TMI 92
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... ... ..... ssly held in K.C. Builders case 2004 265 ITR 562 (SC), the principle will definitely apply to a prosecution under section 277 also. Both the offences have a common foundation. When that foundation is removed under exhibits D5 and D6 orders, the prosecution will not stand. Therefore, it can only be held that in view of the order of cancellation of levy of penalty under exhibit D5 order of the appellate authority and exhibit D6 order of the Income-tax Appellate Tribunal, no prosecution will lie either under section 276C or 277(ii) of the Income-tax Act. In view of my earlier finding, it is not necessary to consider the other aspects argued by counsel. The criminal revision petition is therefore, allowed. The conviction and sentence passed by the learned Additional Chief Judicial Magistrate and confirmed by the Additional Sessions Judge is set aside. The petitioners are acquitted of the offences charged. Bail bonds executed by them will stand cancelled. They are set at liberty.
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2005 (2) TMI 91
Disallowance under section 40A(8) - "Whether Tribunal was legally correct in upholding the finding of the Commissioner of Income-tax (Appeals) that disallowance u/s 40A(8) could be made only with reference to the interest paid to the directors and their relations on their deposits and not of others?" - We find that u/s 40A(8), 15 per cent, of expenditure incurred by a company by way of interest in respect of any deposit received by it is to be disallowed. The disallowance is not restricted to deposits made by the directors or their relatives. It is applicable to all and sundry and wherever interest is paid, 15 per cent, of the amount is to be disallowed. In this view of the matter, the Tribunal was not justified in holding that the disallowance is to be restricted on the amount of interest paid to the directors and their relatives.
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2005 (2) TMI 90
Contravention of the provisions of section 269SS - penalty under section 271D - assessee had no reasonable cause for borrowing the amount in cash - in the exercise of the powers under section 260A of the Act, the findings of the fact of the Appellate Tribunal cannot be disturbed and there is no scope for interference by the High Court with a finding recorded, when such finding can be treated to be a finding of fact. We are therefore of the view that there is no substantial question of law that arises out of the order of the Appellate Tribunal as the Appellate Tribunal has rendered a finding of fact. Tribunal has rightly come to the conclusion that the penalty imposed was not warranted
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