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Home e-Newsletters Index Year 2021 April Day 8 - Thursday

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TMI Tax Updates - e-Newsletter
April 8, 2021

Case Laws in this Newsletter:

GST Income Tax Customs Corporate Laws Insolvency & Bankruptcy PMLA CST, VAT & Sales Tax Wealth tax Indian Laws



Highlights / Catch Notes

    GST

  • Seeking release of detained goods alongwith the truck - invalid documents or not - The truck is exposed to the vagaries of weather and over a period of time the vehicle will be damaged and become a junk. It is well settled that detention of commercial vehicle for a long period in the premises of the police station will not serve any purpose, as it will not only cause loss to the owner but also cause a loss of revenue to the State Exchequer due to non-pliance of the commercial vehicle. - HC

  • Discharge of GST liability - Denial of transition of accumulated credit in respect of Tax Deducted at Source - any deduction made towards anticipated tax liability would assume the character of tax and will not change or fluctuate depending on whether it is held as credit or whether it is an adjustment against tax liability. To attribute such fluctuating character to an amount would distort the scheme of taxation and cause much difficulty in the interpretation on the various ancillary provisions. The interpretation of the provision must be such that it lends itself to certainty in its conclusion. - HC

  • Income Tax

  • Disallowance of advertising expenditure - the deletion of the addition made by the A.O. qua expenditure incurred on advertising both by the CIT(A) and the Tribunal, to our minds, was in order. The extent of expenditure on advertising does not, in our view, decide as to whether the expenditure incurred is of a revenue nature or of a capital nature. - HC

  • Levy penalty under Section 271(1)(c) - As the assessee attempted a change in the method of accounting, concerning the aforementioned expenses. The method of accounting, as noticed by us, was in line with the AS-7. The only reason that the assessee in the quantum appeal preferred before the Tribunal gave up its claim was on account of the fact that it was a new claim which was sought to be incorporated in the fresh return filed by it in pursuant to the proceedings carried out under Section 153A of the Act - which, as per the advice received, could not have passed muster given the state of law, unless incriminating material had been found qua the assessee in the course of the search. - HC

  • Validity of Assessments made u/s 153C - The A.O. has not followed the proviso to Section 153C of the I.T. Act. No satisfaction note have been recorded in the case of person searched and no notice under section 153C have been issued to the assessee. - Resultantly, all additions stand deleted. - The assessment order is set aside - AT

  • TP Adjustment - sale of an under construction vessel - the TPO by observing that the assessee had lost the “Opportunity cost” had clearly exceeded his jurisdiction. Backed by our aforesaid observations, we are unable to uphold the transfer pricing adjustment worked out by the TPO/DRP as regards the notional interest which as per them the assessee ought to have charged from its AE - AT

  • Addition u/s 69 - undisclosed foreign bank account - addition being the peak balance - Matter remanded back to AO for adjudication of the issue afresh stating that the addition towards interest on outstanding credit balance in foreign bank account can only be made on the basis of some evidence/material. Addition cannot be simply made on the basis of presumption and surmises - AT

  • Seeking withdrawal of Revenue Appeal - Resolution of dispute under Mutual Agreement Procedure [MAP] with the U.S.A. - We are of the considered view that the letter dated 02.03.2021 written by the CBDT to the taxpayer stating therein that since all the issues raised by virtue of the taxpayer’s appeals as well as Revenue’s appeals have been settled once for all under MAP proceedings, nothing survives and as such, the contentions raised by the ld. DR to keep the appeals filed by the Revenue alive till completion of some formalities are not sustainable. - AT

  • Grant of approval u/s 10(23C)(vi) denied - The claim being inadmissible in the preceding years on account of receipts exceeding a specified limit, surely does not impinge upon its character of an institution existing solely for the purpose of education. The findings of the Ld.CIT(E) that the same impinges on the extent and quality of surplus being generated by the applicant society is a very general and farfetched observation/finding with no factual basis at all and, therefore, is of no relevance, in our view. - AT

  • Addition made u/s. 69 on account of Transfer Pricing (TP) adjustment - Assessee cannot be expected to prove negative. The onus is on the Department to substantiate that the assessee has advanced amount to Rabobank London for loan to Tata Tea UK or assessee's funds have been diverted in any manner to fund part of said loan. We find that the TPO and the assessing Officer in draft assessment order has placed reliance solely on the letters furnished by an employee of the assessee without there being any corroborative evidence for making addition u/s. 69 - AT

  • Revision u/s 263 - Addition u/s 68 - in the light of the judicial precedents and in the light of fact that AO has conducted enquiries in respect of share capital collected by the assessee company before accepting the share subscribers identity, creditworthiness and genuineness of the transaction and being satisfied did not find it necessary to make any addition u/s. 68 of the Act, which action could not have been interfered by the Ld. PCIT u/s. 263 of the Act since the jurisdictional condition precedent for invoking the same is not satisfied in the facts of this case - AT

  • Disallowance on account of Royalty - estimated liability - What should be certain is the incurring of the liability. It should also be capable of being estimated with reasonable certainty though the actual quantification may not be possible. If these requirements are satisfied the liability is not a contingent one. The liability is in present though it will be discharged at a future date. - Deduction allowed - AT

  • Disallowance of depreciation on car and expenses related to cars which were registered in the name of the directors - the dominion ownership of the car rest with the company. The company being a body corporate is different from the individuals. - In a body corporate there cannot be any element of personal expenses as alleged by the AO - AT

  • Customs

  • Amendment of bills of entry (b/e) - Section 149 of the Customs Act, 1944 - Change of GST Numbers of unit located in different location - The petitioner succeeds and must be permitted to place all records on material that it has in its possession to prove its plea in regard to the erroneous mention of the GSTIN numbers in the b/e. - HC

  • IBC

  • Initiation of CIRP - Period of limitation - it is well settled position of law that Annual Returns/Audited Balance Sheets can be referred to and relied on to see if contents therein amount to acknowledgement or not. - The Respondent has not shown that while preparing the balance-sheets the directors in their reports recorded denial or any reservation with regard to the debts shown by the Chartered Accountant to claim that they were time-barred. If the debt became NPA on 30th November, 2013 and there are acknowledgments in the balance-sheets of 2014-15 to 2016-17 the Application filed under Section 7 of IBC on 15th December, 2017 cannot be said to be time-barred. - AT

  • VAT

  • Priority of charge on the land of the 7th respondent - Recovery of Sales Tax dues - As the 7th respondent ceased to be a Power of Attorney holder of the 6th respondent prior to the coming into force of Section 19C, this Court is of the considered view that protective assessment proceedings under Section 19C could not have been legally invoked against the 7th respondent. - The revenue recovery proceedings initiated by respondents 1 to 4 against the 7 th respondent for recovery of tax dues of the 6th respondent is illegal. All proceedings against the 7th respondent including the attachment of his property for recovery of such dues, are therefore illegal. - HC


Notifications


Circulars / Instructions / Orders


News


Case Laws:

  • GST

  • 2021 (4) TMI 281
  • 2021 (4) TMI 280
  • 2021 (4) TMI 273
  • 2021 (4) TMI 272
  • 2021 (4) TMI 271
  • 2021 (4) TMI 268
  • 2021 (4) TMI 267
  • 2021 (4) TMI 262
  • 2021 (4) TMI 261
  • 2021 (4) TMI 259
  • Income Tax

  • 2021 (4) TMI 277
  • 2021 (4) TMI 276
  • 2021 (4) TMI 275
  • 2021 (4) TMI 274
  • 2021 (4) TMI 270
  • 2021 (4) TMI 266
  • 2021 (4) TMI 258
  • 2021 (4) TMI 257
  • 2021 (4) TMI 256
  • 2021 (4) TMI 255
  • 2021 (4) TMI 254
  • 2021 (4) TMI 252
  • 2021 (4) TMI 251
  • 2021 (4) TMI 250
  • 2021 (4) TMI 249
  • 2021 (4) TMI 248
  • 2021 (4) TMI 247
  • 2021 (4) TMI 246
  • 2021 (4) TMI 245
  • 2021 (4) TMI 244
  • 2021 (4) TMI 243
  • 2021 (4) TMI 242
  • 2021 (4) TMI 241
  • 2021 (4) TMI 240
  • 2021 (4) TMI 239
  • 2021 (4) TMI 238
  • 2021 (4) TMI 236
  • 2021 (4) TMI 235
  • Customs

  • 2021 (4) TMI 265
  • Corporate Laws

  • 2021 (4) TMI 260
  • Insolvency & Bankruptcy

  • 2021 (4) TMI 253
  • 2021 (4) TMI 237
  • PMLA

  • 2021 (4) TMI 284
  • 2021 (4) TMI 283
  • 2021 (4) TMI 282
  • 2021 (4) TMI 279
  • 2021 (4) TMI 263
  • CST, VAT & Sales Tax

  • 2021 (4) TMI 264
  • Wealth tax

  • 2021 (4) TMI 269
  • Indian Laws

  • 2021 (4) TMI 286
  • 2021 (4) TMI 285
  • 2021 (4) TMI 278
 

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