Subscription   Feedback   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Forum Articles Highlights TMI Notes SMS News What's New Calendar Imp. Links Database More...
Extracts
Home List
← Previous Next →

Deputy Commissioner of Income Tax, Central Circle-III, Kolkata Versus Apeejay Shipping Ltd.

Revision u/s 263 - determination of book profits u/s.115JB - Held that:- We are of the view that in the order u/s. 263 of the Act the issue that was considered was the question of reserve u/s.115VT of the Act. It had nothing to do with the determination of book profits u/s.115JB of the Act. The directions in the order u/s. 263 of the Act had the effect of obliterating the order of the AO dated 26.12.2007 only to the extent of determination of book profits u/s.115JB of the Act and not the entire .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

u/s.154 of the Act could have been exercised. We are of the view that the conclusion of the CIT(A) in the impugned order that the order of assessment dated 26.12.2007 was set aside in entirety in the order u/s.263 of the Act is not correct and accordingly the order of the CIT(A) is set aside. The other issues with regard to the other objections raised by the assessee with regard to exercise of power u/s.154 of the Act in the facts and circumstances of the case, are remanded to the CIT(A) for fre .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

under which the above appeal of the revenue arises for consideration are as follows: The Assessee is a company. During the previous year its source of income was from providing services to the shippers/receivers/charterers by operating and maintaining a fleet of dry bulk carriers of various sizes. For AY 2005-06, the Assessee filed return of income declaring total income of ₹ 3,33,95,577/- consisting of business income of ₹ 1,18,57,063 and income from other sources of ₹ 2,46,55 .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

s accepted in the assessment completed u/s.143(3) of the Act by order dated 26.12.2007. In the said order an addition was made to the total income consequent to addition made under the head income from other sources. The Assessee filed appeal against such addition and the CIT(A) dismissed the appeal of the Assessee by his order dated 10.2.2009. 3. The CIT in exercise of his powers u/s.263 of the Act was of the view that the order dated 26.12.2007 passed by the AO u/s.143(3) of the Act for AY 200 .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

after in this section referred to as the Tonnage Tax Reserve Account) an amount not less than twenty per cent of the book profit derived from the activities referred to in clauses (i) and (ii) of sub-section (1) of section 115V-I in each previous year to be utilised in the manner laid down in sub-section (3): Provided that a tonnage tax company may transfer a sum in excess of twenty per cent of the book profit and such excess sum transferred shall also be utilised in the manner laid down in sub- .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

t;I have considered the oral as well as written submission made by Shri Manish Tewari. It is fact that the issue of Tonnage Tax liability of the assessee has been considered by the Assessing Officer. However, no questions are seen to have been raised at the time of hearing regarding the issue under consideration i.e. the adequateness of the creation of the Tonnage Tax Reserve. It is also not the assessee's case that such a question has been raised. The adjustment to be made under S. 115JB, w .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ther, the Assessing Officer has also not gone into the issues of the amount of Tonnage Tax to be considered in relation to which the Tonnage Tax Reserve is to be created. This action of the Assessing Officer in not going into a very relevant issue has also led to the passing of an order which is prejudicial to the interest of revenue. In view of the above the order passed is prejudicial to the interests of revenue and is therefore set aside with a direction to compute the tax liability of the as .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

Profit for charging of MAT u/s 115JB read with section 115VO of the Act. The assessee was specifically requested to furnish the auditor s report in Form 29B for calculation of MAT u/s 115JB read with section 115VO of the Act. It was also requested to explain whether the book profit computed here included the profit on sale of ship amounting to ₹ 52,25,39,585/- credited to the profit & loss account." The explanation with regard to creation of Tonnage Tax reserve u/s.115VT of the Ac .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

uot;The Audit report u/s. 115JB of the Income Tax Act, /961 was not obtained as the Company opted for computation of Income from the Shipping Business under Chapter X11 - G- "Special provisions relating to Income 0/ Shipping Companies" introduced for the first time in the Act from this Assessment year. The Company is under the bonafide belie/ that "Special provisions Relating To Certain Companies" as per Chapter XII-B for payment of Minimum Alternative Tax on Book Profits are .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

MAT u/s. 115.1B read with section 115VO could not be considered under the present proceeding of giving effect to the order u/s. 263 passed by the Ld. CIT. 6.2. The above submissions in respect of levy of MAT u/s.l ] 5JB read with section 115VO of the Act been carefully considered but the same was not found tenable in the eyes of law. The assessee carried on the business of operating of ships and it had opted for Tonnage Tax System w.e.f. 01/04/2005 for a period of 10-years. The approval was gran .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

n Book Pro/its are not applicable to the Company - is not correct in view of the specific provisions of section 115VO of the Act. For the sake of convenience, the provisions of Section 115VO of the Act is reproduced below: "The book profit or loss derived from the activities of a tonnage tax company, referred to in sub-section (1) of section 1l5V-I, shall be excluded from the book profit of the company for the purposes of section 115 JB. " In other words, in computing the book profit u .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

audited accounts for the year ending 31.03.2005 was ₹ 57.15,88,402/-. Hence, according to the provisions of section 115VO the assessee was indeed liable to pay MAT u/s. 115J8. 6.4. In spite of the clear finding given above regarding applicability of MAT u/s. 115JB, the second argument of the Ld. A/R - that the calculation of Book Profit for charging of MAT u/s 115JB did not Emanate from the order passed u/s. 263 on 21.01.2010 - is taken into consideration. It is a fact that the issue of l .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

of total income of the Assessee u/s.115JB of the Act. In response to the said notice the Assessee submitted a reply contending as follows: (i) "That non application of section 115JB in the order u/.s 143(3) presupposes that tax payable on total income is higher and hence the detailed working was not spelt out. (ii) That Book profit u/s 115JB was not computed as the company opted for Tonnage Tax Scheme, that there is no reference to computation of Book Profit in the assessment order. (iii) D .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ct of some other issue unconnected with the issue of determination of books profits u/s.115JB of the Act. The AO ultimately determined book profit u/s.115JB of the Act in substitution to the income determined under Chapter XIIG of the Act as the tax payable on book profit u/s.115JB of the Act was more. The AO passed the order u/s.154 of the Act on 28.2.2011. 9. Aggrieved by the said order dated 28.2.2011, the Assessee preferred appeal before the CIT(A) reiterating the objections that were made b .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

tions of the CIT(A) in the impugned order: "5. I have perused the relevant orders and the material placed on record. I find merit in the submission that the assessment order dated 26-12-2007 was not in existence as the same had already been set aside by the CIT vide his order u/s 263. The operational portion of the order u/s 263 reads: In view of the above the order passed is prejudicial to the interests of revenue and is therefore set aside with a direction to compute the tax liability of .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

that the order u/ s 263 was issue based, and so, the assessment order dated 26-12-2007 could be rectified u/s 154. The order u/s 263 no doubt directed the AO to compute the tax liability of the assessee as per law after considering the issue of creation of the correct amount of Tonnage Tax Reserve. But then, it cannot be said that the assessment order was set aside for limited purpose of deciding a particular issue. On the contrary, the entire assessment order was set aside u/s 263 and the AO wa .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

considered view that the order u/s 154 passed by the AO is not sustainable in law. Ground no 1 is allowed. In ground no 2, the assessee has contended that the issue was beyond the scope of section 154. Ground no 3 relates to the merit of the issue. As the appeal has been allowed on technical ground, I am not inclined to adjudicate these grounds. Ground no 4 relates to the charging of interest u/s 234B which is consequential. Ground no 5 is general in nature." 10. Aggrieved by the order of .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

very specifically accepted this stand of the Assessee and has thereafter resorted to proceedings u/s.154 of the Act. He therefore submitted that the order of the AO is erroneous and deserves to be set aside. The learned AR relied on the order of the CIT(A). 11. After considering the rival submissions, we are of the view that in the order u/s.263 of the Act the issue that was considered was the question of reserve u/s.115VT of the Act. It had nothing to do with the determination of book profits u .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

  ↓     Latest Happening     ↓  

Highlight: Sharing of expenses - BAS - promotion of business of group companies - sharing of expenditure for common facilities cannot be treated as service by one to another in such arrangement.

Forum: Cess paid instead of SGST

Forum: import purchase

News: RBI Reference Rate for US $

Forum: 3B mistake

Forum: Input credit of gst paid on urd

Article: Credit of unsold stock [Section 140(3)] - Actual Credit as well as Notional Credit - Part-I - GST Transitional provisions

Circular: Certain Clarifications sought on Construction Services provided in the Real Estate Sector reg.

Forum: transfer of shares

Forum: Input tax credit

News: Anti-dumping duty on import of bus/truck tyres from China

News: Fast-track GST refund, else ₹ 65K cr may be stuck: Exporters

Highlight: It is open to the Settlement Commission to use best judgment in arrival of the figure. Nonetheless it has to explain the manner in which the best judgment figure has been arrived at by the Settlement Commission - HC

Highlight: Deemed dividend u/s 2(22)(e) - advances given to societies - in the absence of legal right of the assessee in the said society the amount advanced cannot be treated as deemed income.

Highlight: When electrical installations are treated as plant and machinery the depreciation has to be allowed @ 25% as per provisions contained u/s 32

Forum: GST return filing software online | Easy GST compliance management

TMI Note: Capital Gain - transfer of right in the land or transfer of land itself - addition u/s 50C - Harassment to the honest tax payers

Highlight: Option to avail composition scheme under GST by electronically filing an intimation in FORM GST CMP-02 and FORM GST ITC-03 upto 30-9-2017 - See Rule 3(3A)

TMI Note: Does ICDS apply for the purposes of computing exemption u/s 11 to 13.

Highlight: Voluntary Reporting of Estimated Current Income and Advance Tax Liability - CBDT issues draft notification

TMI Note: Certain ICDS provisions are inconsistent with judicial precedents. Whether these judicial precedents would prevail over ICDS.

Highlight: Provisions of ICDS shall prevail w.e.f. AY 2017-18 to the transactional issues dealt therein over earlier judicial pronouncements.

Notification: Levy of anti dumping duty on New/unused pneumatic radial tyres with or without tubes and/or flap of rubber (including tubeless tyres) having normal rim dia code above 16 originating in, or exported from China PR

News: Voluntary Reporting of Estimated Current Income and Advance Tax Liability

TMI Note: In case of conflict between ICDS and other specific provisions of the Income-tax rules, 1962 governing taxation of income like rules 9A, 9B etc. of the Rules, which provisions shall prevail.

TMI Note: Does ICDS apply to computation of Minimum Alternate Tax (MAT) u/s 115JB of the Act or Alternate Minimum Tax (AMT) u/s 115JC of the Act.

TMI Note: Where a term has not been defined under ICDS, nor under the Act, but has different interpretations given to it by the courts in tax cases, and in ICAI Accounting Standards, which interpretation would prevail while interpreting ICDS.

TMI Note: Whether the provisions of ICDS apply to a non-resident who claims the benefit of a double taxation avoidance agreement (DTAA).

TMI Note: In case any of the ICDS provisions is contrary to a circular or press release issued by the CBDT, which would prevail over the other.

TMI Note: ICDS-I requires disclosure of significant accounting policies and other ICDS requires specific disclosures. Where is the taxpayer required to make such disclosures specified in ICDS.

Notification: Income Computation and Disclosure Standards (ICDS) - New ICDS to be effective from AY 2017-18

News: RBI Reference Rate for US $

Highlight: GST - Detention of goods under transport - discrepancy in documents - the statutory provisions provide a mechanism for adjudication following detention of goods including for the provisional release thereof pending adjudication - HC

Highlight: Reassessment - first few paragraphs of the assessment order dealt with objections and disposed of accordingly - Unfortunately, the manner in which the AO has decided the issue is wholly unsustainable in law - HC

Highlight: Business expenditure u/s 37 - liquidated damage - breach of contract terms - Expenditure was not incurred for any purpose which is an offence or which is prohibited by law - cannot be disallowed - HC

Highlight: Valuation - inclusion of reimbursement of expenses - managing participation of clients in certain mela, fairs, promotional activities etc. - They are liable to service tax on the gross amount received - They cannot restrict their tax liability to only agency commission

Highlight: TDS liability - ITAT confirmed the liability - We do not see how it is possible for us to uphold the order of the Tribunal and when it purports to decide two Appeals of the Revenue by single paragraph conclusion - HC

Highlight: Reopening of assessment - sufficiency of material available with the AO to form a belief that income chargeable to tax had escaped assessment - bogus purchases - seller refused to respond - notice would not be interfered with - HC

Highlight: Exemption u/s 11 - education activities - transport and hostel facilities surplus cannot be considered as business income of the assessee society

News: Draft Notification for insertion of new rule 39A in the Income-tax Rules, 1962 comments and suggestions-reg.

Highlight: Genuineness of labour wages expenses, embroidery charges, fabrication expenses etc. - getting work done through small workmen who do not have any permanent place of residence - disallowance of ad hoc expenditure deleted.

Highlight: Project import - Since the goods were never used for the purpose for which it was imported, the actual user condition has been violated - Redemption fine and penalty imposed.

Highlight: Penalty u/s 112 (a) - CHA - Lack of due diligence and failure to take more precautions can not, by itself, bring in penal consequences

Highlight: Import of services - GST - The fact that those services were received outside India will not change the fact that the services have been paid for by the beneficiary appellant, who is located in India. - Demand confirmed.

Notification: SEZ for IT/ITES at Madhurwada Village, Visakhapatnam District in the State of Andhra Pradesh - denotified.

Highlight: Merely because payment is received in Indian rupee, it cannot be said that payment against export has not been received in convertible foreign exchange.

Highlight: Merely vehicle numbers was not mentioned on the invoices cannot be the reason to deny Cenvat Credit

Highlight: Extension of time limit for submitting the declaration in FORM GST TRAN-1 under rule 120A of the Central Goods and Service Tax Rules, 2017 - Circular

Circular: Extension of time limit for submitting the declaration in FORM GST TRAN-1 under rule 120A of the Central Goods and Service Tax Rules, 2017

News: Auction for Sale (Re-issue) of Government Stocks



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version