Subscription   Feedback   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Articles Highlights TMI Notes SMS News Newsletters Calendar Imp. Links Database Experts Contact us More....
Extracts
Home List
← Previous Next →

M/s Karnataka Municipal Data Society Versus The Income Tax Officer

Treatment to grant and the interest earned thereon as income of the Appellant-society - Appellant guided by the directions of the Government of Karnataka - Held that:- When the assessee is to act as a custodian of the Government money released to the assessee by way of a grant and the interest thereon is also to be utilised as per the terms and conditions of the grant, the view taken by the Tribunal cannot be sustained for two reasons. One is that such cannot be termed as ‘income’ of the assesse .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ned thereon remains with the Government, same cannot be termed as income of the assessee. - The impugned order passed by the Tribunal is set aside and the questions are answered in favour of the assessee - ITA NOS.103-104/2016 & 387-388/2016 C/W ITA NO.306/2014 - Dated:- 5-10-2016 - Jayant Patel And Aravind Kumar, JJ. For the Petitioner : Sri. S Parthasarathi, Advocate For the Respondent : Sri K. V. Aravind, Advocate ORDER As common questions are to be considered, they are considered simulta .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

authorities below are justified in rejecting the plea of the Appellant and treating the grant and the interest earned thereon as income of the Appellant when admittedly the funds were held by the Appellant in the capacity of custodian only and the funds and interest were to be utilized as per the directions of the Government of Karnataka alone? (c) Whether in law, the authorities below are justified in interpreting the order of the Government of Karnataka dated 02.02.2010 as an after thought wit .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

the amount of grant is utilised, money is to remain in the respective Bank account of the assessee - Society and interest may accrue thereon. In the assessment proceedings, assessing officer found that interest earned on the aforesaid deposits lying in the Bank account can be termed as income of the assessee and therefore, exemption from income was unavailable. Matters were carried in the appeal before the CIT (Appeals) and CIT (Appeals) dismissed the appeal. The matter was further carried in a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

see s own case for Assessment Year 2009-10. In its order in ITA No.1843/Bang/2013 dated 9.5.2014 the co-ordinate bench adjudicated these issues in favour of Revenue and against the assessee holding as under at paras 12 to 14:- 12. We have given a careful consideration to the rival submissions. At pages 58 & 59 of the assessee s paper book are copies of the English translation of the Government Order dated 17.1.2009 releasing grants to the assessee society for the year 2008-09. The order in v .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ar 2007-08. This grant should be incurred for the year 2008-09 under the Account Head 3604-00-193-0-01 (100) (plan). In the Government Order, Director, Directorate of Municipal Administration has been authorized to draw from State Huzur Treasury and to recover a sum of ₹ 197.00 lakhs, which was released to Karnataka Municipal Data Society for the year 2007-08, and the remaining amount of ₹ 77.00 Lakhs to Karnataka Municipal Data Society for the Operational Cost and pay through cheque .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ased a total sum of ₹ 299 lakhs as under, for meeting the expenditure of the Karnataka Municipal Data Society; 1) Government Order No.15 SFC 2008 dated 07/03/2008 ₹ 197 lakhs 2) Government Order No.15 SFC 2008 dated 17/01/2009 ₹ 77 lakhs 3) Government Order No.15 SFC 2008 dated 27/08/2009 ₹ 25 lakhs However, the Government has not specified the purposes for which the grant is to be utilized nor quantified the amounts to be utilized against such purposes. It is felt necess .....

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 in a manner it may deem fit. The Society shall hold the money as a custodian for the Government. It shall create a fund out of the grant money and any accrued interest and utilize the funds for assisting the member bodies in implementation of e- Governance. If any asset is created out of this fund shall belong to the Government. Utilization certificate shall be submitted to Government after spending the funds. Further in case the amount is unspent the same shall vest in such an institution or .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

see does out of the grant and the interest accrued on the grant can only be said to be application of income and it cannot be said that there was diversion of income by overriding title. Taking note of the above factual position for the A.Y.2009- 10, the plea of the assessee that there was diversion of income by overriding title cannot be accepted. Accordingly, the order of the CIT (Appeals) is confirmed. …….. 4.4.2. Following the aforesaid decision of the co-ordinate bench of this .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

, the grounds at S. Nos. 1 to 4 raised by the assessee are dismissed. Similar is the view taken by the Tribunal in the other matters. Under these circumstances, appeals before this Court. 4. We have heard Mr.Parthasarathy, learned counsel appearing for appellant and Mr.Aravind, learned counsel appearing for respondent. 5. As such, when the assessee is to act as a custodian of the money and the utilization thereof is fully controlled by the Government, money remains as given for specified purpose .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

)284 ITR 0582 wherein of course, Tribunal had held that it is not an income of the assessee but the revenue was in appeal before this Court. In the said decision, this Court at para 4 observed thus: 4. The material on record shows that the very purpose of constitution of the assessee was to act as a nodal agency for implementation of mega-city scheme worked out by the Planning Commission. Both the Central and the State Governments are expected to provide requisite finances for implementation 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

e is a nodal agency formed/created by the Government of Karnataka as per the guidelines; there is no profit motive as the entire fund entrusted and the interest accrued therefrom on deposits in bank though in the name of the assessee has to be applied only for the purpose of welfare of the nation/States as provided in the guidelines; the whole Of the fund belongs to the State Exchequer and the assessee has to channelise them to the objects of centrally sponsored scheme of infrastructural develop .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

sessee is only acting as a nodal agency of Central Government for implementation of these projects. It is not the case of the Revenue that the assessee was carrying on any business or activities of its own while implementing the scheme in question. The unutilised money, during which the project could not be fully implemented, is deposited in a bank to earn interest. That interest earned is also again utilised for the implementation of the mega-city scheme which is also permitted under the scheme .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

what is new what is new
  ↓     Latest Happenings     ↓  

News: Notification Issued For GST Actionable Claim On Branded Food Products

News: GST Refund - Blockage of Working Capital of Exporters - earlier also there was a normal blockage of funds for a period of 5-6 months at least

News: Clarification about Transition Credit - ₹ 1.27 lakh crore of credit of Central Excise and Service Tax was lying as closing balance as on 30th June, 2017 - claim of credit of ₹ 65,000 crore is not unexpected

Article: 20 Things You must know about E Way Bills in GST Law

Article: MISTAKES IN DRAFTING

Forum: Duty Drawback- Urgent

Highlight: The Customs and Central Excise Duties Drawback Rules, 2017 and All Industry Rates (AIRs) of Drawback related changes -reg. - Circular

Highlight: The definition of "subsidiary company" or "subsidiary" u/s 2(87) of the Companies Act, 2013 shall come into force w.e.f. 20-9-2017

Highlight: Central Government notified the All Industry Rates of Duty Drawback Schedule w.e.f. 1.10.2017 - Notification

Notification: All Industry Rates of Duty Drawback Schedule w.e.f. 1.10.2017

Circular: Investment by Foreign Portfolio Investors in Corporate Debt Securities – Review

Notification: Exemptions on supply of services under UTGST Act

Notification: Rates for supply of services under UTGST Act

Notification: Exemptions on supply of services under IGST Act

Notification: Rates for supply of services under IGST Act

Notification: List of Exempted supply of services under the CGST Act

Notification: Rates for supply of services under CGST Act

Highlight: Acceptance of deposits by companies from its members - conditions relaxed in case of Specified IFSC Public company and a private company - Rule 3 amended

Notification: Rate of exchange of conversion of the foreign currency with effect from 8th September, 2017

News: Tax Payers Advised To Confirm Identities Of Income Tax Search Authorities

Notification: Amendment in Appendix 3 (SCOMET items) to Schedule- 2 of ITC (HS) Classification of Export and Import Items 2012

Forum: GST Invoice

Notification: The Customs and Central Excise Duties Drawback Rules, 2017

Circular: The Customs and Central Excise Duties Drawback Rules, 2017 and All Industry Rates (AIRs) of Drawback related changes -reg.

News: GST implementation smoother than expected: Jaitley

Forum: GST - TRAN1 - filed - Data uploaded with Remarks Processed with Error - Not coming in Electronic credit ledger - need suggession guidance

Forum: 3B mistake

Forum: Input tax credit

Forum: Excise duty credit on finished stock at additional place of business.

Forum: Due date of Filing TRAN-1

Highlight: Diversion of income at source - Joint venture agreement - 97% of the receipt transfer to M/s TRG Industries (P) Ltd. - scope of the agreement - it is diversion by overriding title - not taxable in the hands of assessee - HC

Highlight: Expenditure on eligible projects or schemes u/s 35AC - After 01.04.2017 the legislature desired to withdraw such deduction. - The Union legislature was competent to introduce such amendment - HC

Highlight: Transfer of trading assets at cost price, the profit component also stood transferred to the outgoing Directors, which otherwise belonged to the Company - the fact that AO has made the addition in the hands of the Directors would not make any difference - additions confirmed - HC

Highlight: The interest u/s 234B of the Act cannot go beyond the stage of S.245D(I) before the Settlement Commission - HC

Highlight: Galvanized iron pipe is a different commercial commodity than a iron pipe, therefore the activity of galvanization in our considered opinion amounts to manufacture - Deduction u/s 80-IB allowed - HC

Highlight: Penalty u/s 271C - non deduction of TDS on interest paid to sister concerns in terms of Section 194A - Levy of penalty confirmed - HC

Highlight: Disallowance of interest - reference to section 179 - The legislature has also recognised, that the doctrine of lifting of veil in the matter of tax dues is to be applied to prevent fraud etc. and not where the company has suffered despite its normal bona fide function. - HC

News: RBI Reference Rate for US $

Notification: Amendment in Notification No. S.O. 3118(E), dated the 3rd October, 2016

Highlight: Discount on ESOP to be allowed as business expenditure u/s 37(1), during the years of vesting on the basis of percentage of vesting during such period, subject to upward or downward adjustment at the time of exercise of option.

Notification: Central Government appoints the 20th September, 2017 as the date on which proviso to clause (87) of section 2 of the Companies Act 2013, shall come into force

Notification: Companies (Restriction on number of layers) Rules, 2017

Highlight: Penalty u/s 271(1)(c) - additional income disclosure - surrender of income post survey u/s 133A - he disclosure made by the assessee is voluntary in nature, in the revised return - no penalty

Highlight: Reopening of assessment - notice u/s 148 issued on the directions of JCIT / CIT - a perusal of reasons for initiating reassessment proceedings clearly show that they are against the sprit of provisions u/s 147

Highlight: MAT - Adjustment to book profit - computation u/clause (f) of Explanation-1 to section 115JB(2) is to be made without resorting to the computation as contemplated u/s 14A r.w.Rule 8D of I.T. Rules.

Highlight: Addition on account of alleged suppression of service value received - the addition made simply believing the Form 26AS will be an arbitrary exercise of power which cannot be sustained

Notification: Exempts intra state supply of heavy water and nuclear fuels from DAE to NPCIL

Notification: Seeks to amend notification No. 12/2017-UTT(R) to exempt right to admission to the events organised under FIFA U-17 World Cup 2017

Notification: Seeks to amend notification No. 11/2017- UTT(R) to reduce CGST rate on specified supplies of Works Contract Services

Highlight: Liability to pay duty on import of software - Though no authorization was given by the appellant to DHL, it is an undisputed position that the software has, in fact, been ordered by the appellant and have been delivered to them by DHL - the appellant is to be considered as the importer



|| 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