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Home e-Newsletters Index Year 2013 August Day 14 - Wednesday

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TMI Tax Updates - e-Newsletter
August 14, 2013

Case Laws in this Newsletter:

Income Tax Customs Corporate Laws FEMA Service Tax Central Excise CST, VAT & Sales Tax



Highlights / Catch Notes

    Income Tax

  • Application of section 50C of the Act to the transfer of leasehold rights in the industrial plot - Addition made by the AO on the basis of circle rate gathered from Sub-Registrar office of Rampur showing circle rate of properties cannot be applied as there was no application of section 50C in the case - AT

  • Reassessment proceedings u/s 147 - Section 40A(3) applies in the case of expenditure claimed by the assessee, but in this case, the assessee did not claim any expenditure in the profit and loss account of all the concerns held by him - The AO had to act on the basis of reason to believe and not on reason to suspect - AT

  • Minimum Alternate Tax (MAT) - Adjustment to book profit u/s 115JB - Adjustment of loss to sick industrial company - A.O. on long drawn process of reasoning should not have passed the order under Section 154 of the Act - whatever amount was reduced from the profit of business on account of loss to sick industrial company were in accordance with law. - AT

  • Tax Planning versus Tax Avoidance - Finance Lease / Operating lease - No straight jacket formula can be adopted to say that every case of sale and lease back transactions is sham or genuine - real intention was to enter into transaction of loan/finance only and the assessee was never intended to be the real and legal owner of the assets – Depreciation not allowed - AT

  • Merely because the Settler of the trust has claimed deduction under section 80G of the Act on the donations made to the assessee Trust, does not merit the cancellation of registration granted to the Trust u/s 12AA - AT

  • Disallowance u/s 36(1) (viia) - creation of reserve for bad debts - in the absence of any extra provision for bad and doubtful debts, having been created by the assessee as per the audited accounts available in the paper book, deduction not allowed - AT

  • Penalty u/s 271D - violation of section 269SS - Reasonable Cause u/s 273B - The claim of the assessee is that receipt of money by way of cash itself is a reasonable cause - mere receipt of cash, itself cannot be a reasonable cause. - Penalty levied - AT

  • Book profit for the purpose of MAT (Minimum alternate Tax) - The lower of the solitary figures of the unabsorbed depreciation or loss brought forward for all the earlier years taken together is to be reduced for the purposes of computing book profit u/s 115 JB of the Act. - Decided against the revenue. - AT

  • Disallowance u/s 14A - Rule 8D is toward estimating the expenditure that can be attributed to the tax exempt income and, thus, could not, in any case, exceed the actual expenditure incurred and claimed by the assessee - AT

  • Deduction u/s 80IB - Audit report not furnished - interpretation merely permits the assessee to produce the said report even after the date of the filing of the return as passed; it does not wholly do away with the requirement of filing the report altogether - HC

  • Customs

  • Foreign Travel Tax (FTT) - Delay in Depositing the amount – Applicant had deliberately contravened the provisions of Section 38(3) of Finance Act, 1979 (FTT) - For these contraventions, the applicant was now circumventing the basic truths and for these contraventions the department had very rightly imposed the minimum penalty as mandatorily prescribed in the Section itself - CGOVT

  • VEscapement of duty – Hardware and software to be assessed independently on merits whether they imported together or separately - Commissioner had gone beyond the scope of show-cause notice by holding that the appellants have inflated the value of software - AT

  • FEMA

  • Relevant fact U/s 10 of Evidence Act - In a case a conspiracy if there was reasonable ground to believe that two or more persons have conspired together to commit an offence then by virtue of Section 10 of the Evidence Act, anything said, done or written by one of such persons in reference to their common intention, was a relevant fact as against each of the persons - HC

  • Corporate Law

  • Oppression and Mismanagement - Principles of quasi partnership - The private agreements can neither be sought to be enforced nor their breach give any cause of action to file a petition under sections 397 and 398 of the Act - CLB

  • Service Tax

  • Reverse Charge - even if the service was taxable as ‘Business Support Service’, there will not be any change in tax liability under reverse charge mechanism or any other count - revenue-neutrality cannot be taken as a ground for avoiding payment of tax at any stage of a VAT system - AT

  • Residential Complex u/s 65(91a) – The new entry uses the very same expressions defined earlier and subjected to tax but a new composition scheme for discharging liability was introduced - So it cannot be considered that the earlier entries were null and void. - AT

  • Classification of category under Business Auxiliary Services – SPV formed as a result of agreement between NHAI or State Authority and the concessionaire under the BOT arrangement, the Concessionaire cannot be considered as an agent of the NHAI - AT

  • Penalty on service tax default section 76 – Failure to pay service tax on GTA service under reverse charge method – only reason stated was that the non-payment of service tax was not willful cannot be accepted - penalty confirmed - AT

  • Central Excise

  • Removal of goods under Rule 4(6) of the Cenvat Credit Rules, 2004 - Sale of goods from the premises of Job worker - permission denied - Once the goods are recognized to be intermediate product there is no reason to deny the benefit Rule 4 (6) of Cenvat Credit Rules, 2004. - AT

  • Just because there was no entry in the RG-1 register regarding transfer of 10 transformers from the bonded store room to the manufacturing section of the factory for reovening and when this fact was told to the officers at that time but still they did not verify, it cannot be concluded that there was unexplained shortage of 10 transformers - AT

  • Confiscation of goods under Rules 25 of the CER, 2002 – goods are not entered in RG-I Register, but it cannot be said that by merely not entering in RG-I Register, there was any intention to evade duty by the appellants - AT

  • VAT

  • Constitutional validity - Legislative competence for enhancing transit fee and changing the basis of levy from cubic feat to advalorum between 5% to 15%, on variety of forest produce including timber, firewood, and other forest produce coming from mines e.g., coal, limestone, sand, bajari and other minerals - All the notifications quashed - HC


Articles


Notifications


Circulars / Instructions / Orders


News


Case Laws:

  • Income Tax

  • 2013 (8) TMI 421
  • 2013 (8) TMI 413
  • 2013 (8) TMI 412
  • 2013 (8) TMI 411
  • 2013 (8) TMI 410
  • 2013 (8) TMI 409
  • 2013 (8) TMI 408
  • 2013 (8) TMI 407
  • 2013 (8) TMI 406
  • 2013 (8) TMI 405
  • 2013 (8) TMI 404
  • 2013 (8) TMI 403
  • 2013 (8) TMI 402
  • 2013 (8) TMI 401
  • 2013 (8) TMI 382
  • 2013 (8) TMI 381
  • Customs

  • 2013 (8) TMI 414
  • 2013 (8) TMI 399
  • 2013 (8) TMI 398
  • 2013 (8) TMI 397
  • 2013 (8) TMI 396
  • 2013 (8) TMI 395
  • 2013 (8) TMI 394
  • Corporate Laws

  • 2013 (8) TMI 393
  • FEMA

  • 2013 (8) TMI 400
  • Service Tax

  • 2013 (8) TMI 419
  • 2013 (8) TMI 418
  • 2013 (8) TMI 417
  • 2013 (8) TMI 416
  • 2013 (8) TMI 415
  • Central Excise

  • 2013 (8) TMI 392
  • 2013 (8) TMI 391
  • 2013 (8) TMI 390
  • 2013 (8) TMI 389
  • 2013 (8) TMI 388
  • 2013 (8) TMI 387
  • 2013 (8) TMI 386
  • 2013 (8) TMI 385
  • 2013 (8) TMI 384
  • 2013 (8) TMI 383
  • CST, VAT & Sales Tax

  • 2013 (8) TMI 420
 

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