Pages

Monday, January 31, 2011

VAT AUDIT DATE EXTENDED BY 15 DAYS.

Dear Members,

After the continuous followup and efforts of WIRC; the authorities agreed to extend the VAT audit date by 15days. The official communication is expected shortly.

Regards,
-------
CA.C.V.PAWAR

Sunday, January 30, 2011

VAT AUDIT “ERRORS/ ISSUES”

Dear Professional Colleagues,

 

Considering only 2 days left for e-filling VAT AUDIT REPORT and in view of various problems being faced while e-filling of VAT Audit Report and also due to various related issues; the members are requested to ensure the follow in order to avoid the future penal action under MVA Act for non filling of VAT AUDIT Report before the due date:

 

            1. Take the print out of the errors occurred while e-filling the VAT Audit Report.

            2. The soft copies of files, forms etc.

3. To keep the evidence of the issues/problems due to which return could not be filled within time.

 

The members are requested to ensure proper documentation of evidence, which may save from future penal action.




Regards,
-------
CA.C.V.PAWAR
0253-2319641. M-9423961209

Saturday, January 29, 2011

Easy Search of Activity code

---------- Forwarded message ----------
From: Kaushal K Mundada <kaushalmundada@gmail.com>
Date: Fri, Jan 28, 2011 at 11:03 AM


Dear All,
 
Please refer web: www.taxonclick.com for easy search of Activity code for MVAT Audit.
 
Regards,
KAUSHAL K MUNDADA

MCA COMPANY Easy Exit Scheme -2011

---------- Forwarded message ----------
From: devendra doshi doshid2002@yahoo.com

Dear Mr. Goel
The form of of affidavit and Indemnity Bond  are given in the ESS 2011.
I am enclosing herewith the entire scheme published by MCA.  I hope this will serve your purpose.
D.K.Doshi


CERTIFIED COPY OF RESOLUTIONS PASSED AT THE BOARD MEAFFFIDAVIT AND BOND PROFORMA.doc (application/msword) 51.00K https://docs.google.com/viewer?a=v&pid=explorer&chrome=true&srcid=1_x8fI9trSf7iku9XFuanvVD2EcSxi4LxN3M5Eysbj7I-U-OIIPt5AIthv48I&hl=en&authkey=CJG4wrwF

General Circular No. 6 /2010 : https://docs.google.com/viewer?a=v&pid=explorer&chrome=true&srcid=1lkooEdVT35Pfhs_EzRP8a55Xo5u3Dx5U3jtyJe_2ZzkKGlUhyBtGXLYsz5Rk&hl=en&authkey=CJCWkLUP

Thursday, January 27, 2011

REPRESENTATION FOR VAT AUDIT DATE EXTENSION

DEAR MEMBERS,
 
The WIRC has made representation for extension of VAT Audit date.
 
The WIRC office bearers has made every possible efforts by representing/meeting various ministers and concerned departmental authorities. However, we have not yet received any concrete assurance about extension of date.
 
I've taken updates from WIRC Chairman, today evening.
 
Regards,
-------
CA.C.V.PAWAR
Member of Western India Regional Council of
Institute of Chartered Accountants of India
The Chairman, Banking, Insurance and Pension Committee of WIRC of ICAI
0253-2319641. M-9423961209

ITR VOL 330 PART 5 AND ITR (TRIB) VOL 7 PART 5


INCOME TAX REPORTS (ITR)

Volume 330 : Part 5 (Issue dated 31-1-2011)

SUBJECT INDEX TO CASES REPORTED IN THIS PART

HIGH COURTS

Advance tax --Interest--Non-resident--Entire income liable to deduction of tax at source--Assessee not liable for advance tax--Cannot be charged interest for failure to pay advance tax--Income-tax Act, 1961, ss. 201, 209, 234B-- Director of Income-tax v. Jacabs Civil Incorporated (Delhi) . . . 578

Assessment --Assessment on agreed basis--Assessee cannot appeal against such order--Income-tax Act, 1961-- CIT v. Vamadevan Bhanu (Ker) . . . 559

Business expenditure --Disallowance--Excessive and unreasonable payments--Addition for purchases and sales made from sister concern--Finding by Commissioner (Appeals) as well as Tribunal as to genuineness of valuation in transaction between sister concerns not perverse--Findings of fact--Income-tax Act, 1961, s. 40A(2)(b)-- CIT v. Jyoti Industries (P&H) . . . 573

----Disallowance--Excessive or unreasonable payments--Trade discount--Discount allowed to sister concern--Assessee claiming 11 per cent. on ground of bulk sales--Assessing Officer allowing 3 per cent., Commissioner (Appeals) enhancing to 8 per cent. while Tribunal reducing to 5 per cent.--Assessee allowed 11 per cent. in earlier years--Assessee entitled to 11 per cent.--Trade discount not an expenditure--Section 40A(2)(b) does not apply--Income-tax Act, 1961, s. 40A(2)(b)-- United Exports v. CIT (Delhi) . . . 549

Capital gains --Valuation of capital asset--Reference to Departmental Valuation Officer--Condition precedent--Opinion of Assessing Officer that value claimed is less than fair market value--Income-tax Act, 1961, s. 55A-- CIT v. Umedbhai International P. Ltd. (Cal) . . . 506

Cash credits --Burden of proof--Initial burden on assessee to prove identity of creditors--Burden then shifts to Revenue to prove credits were not genuine--Identity of applicants for shares and their PAN numbers furnished--Amounts received through account payee cheques--Inability to find a few applicants--Not sufficient to invoke section 68--Income-tax Act, 1961, s. 68-- CIT v. Winstral Petrochemicals P. Ltd . (Delhi) . . . 603

Circulars --Scope of--Income-tax Act, 1961, s. 119-- Deputy CIT v. Sunita Finlease Ltd. (Chhattisgarh) . . . 491

Deductions --Law applicable--Section 14A prohibiting deduction of expenses relating to non-taxable income--Circular of CBDT dated 23-7-2001 stating that concluded assessments could not be reopened for purposes of section 14A--Meaning of "concluded assessment"--Assessment which could be modified by higher authority not a concluded assessment till expiry of time-limit for such modification--Assessment order remanded for modification in appeal--Subsequent revision of order--Permissible--Income-tax Act, 1961, s. 14A--CBDT Circular 11 dated 23-7-2001 (250 ITR (St.) 84)-- Catholic Syrian Bank Ltd . v. CIT (Ker) . . . 556

Deduction of tax at source --Salary--Effect of sub-section (3) of section 192--Default in deduction can be made up during financial year--Income-tax Act, 1961, ss. 192, 201-- CIT v. Enron Expat Services Inc. (Uttarakhand) . . . 496

Estimate of income --Gross profit--Assessee failing to produce books of account--Assessing Officer assessing income at 5 per cent. of gross receipts--Tribunal modifying to 4 per cent. of gross receipts--Justified--Assessment for previous year a guide not binding for subsequent years--Income-tax Act, 1961-- Arvind Baloni v. ITAT  (P&H) . . . 589

Income-tax --General principles--Rule of consistency--Loss on sale of shares treated as business loss though stock of shares shown as investment--Assessment after enquiry--Different view not to be taken for subsequent year--Income-tax Act, 1961-- CIT v. Darius Pandole (Bom) . . . 485

Interest --Interest on excess refund--Provision not applicable prior to assessment year 2004-05--Income-tax Act, 1961, s. 234D-- Director of Income-tax v. Jacabs Civil Incorporated (Delhi) . . . 578

Interest on borrowed capital --Disallowance on ground that a part of amount given to subsidiary company--Revenue failing to establish that loan given for only personal purposes--Finding that interest not to be disallowed--Justified--Income-tax Act, 1961, ss. 36(1)(iii), 37-- CIT v. Dalmia Cement Bharat Ltd. (Delhi) . . . 595

Penalty --Assessee claiming revenue expenditure--Penalty imposed holding expenditure capital--Finding by Commissioner (Appeals) as well as Tribunal that issue debatable--Penalty not attracted--Income-tax Act, 1961, s. 271(1)(c)-- CIT v. Krishna Maruti Ltd. (Delhi) . . . 547

----Concealment of income--Assessee computing pre-operative expenses after deducting interest and showing in balance-sheet filed along with return of income--Assessing Officer holding that interest cannot be adjusted against pre-operative expenses--Not a case of concealment of income--Penalty cannot be imposed--Income-tax Act, 1961, s. 271(1)(c)-- CIT v. Mushashi Autoparts India P. Ltd. (Delhi) . . . 545

Reassessment --Unexplained money--Presumption that represents income of year in which found--Voluntary disclosure under 1997 Scheme of assets stated to be acquired in 1985-86 and 1986-87--Declaration becoming invalid for failure to pay tax--Reassessment for assessment year 1998-99 on basis of disclosure--Permissible--Income-tax Act, 1961, ss. 69A, 147, 148--Finance Act, 1997, ss 68, 71, 72-- CIT v. Prem Pal  (P&H) . . . 499

Recovery of tax --Interest on delayed payment of tax--Waiver of interest--Conditions precedent--Conditions laid down in section 220(2A) are cumulative--Payment of interest whether would cause genuine hardship to assessee--Income of relevant period to be taken into account--Past liabilities not relevant--Finding that payment of interest would not cause genuine hardship--Refusal to waive interest--Justified--Income-tax Act, 1961, s. 220(2A)-- P. Sudhakaran v. Deputy CIT (Ker) . . . 488

----Interest--Waiver of interest--Law applicable--Section 220(2A) inserted with effect from 1-10-1984--Not applicable where assessments completed and demand notices issued before 1-10-1984--Writ petition challenging validity of provision--Failure to pay tax under disputed provision--Presumption of validity of provision--Provision subsequently held valid by Supreme Court--Levy of interest justified--Income-tax Act, 1961, s. 220(2A)-- Prakash Tubes Ltd. v. Union of India (Delhi) . . . 561

Rectification of mistakes --Loss--Set-off--Debatable issue not mistake apparent from record--Wrong allowance of set off of losses could not be rectified under section 154--Income-tax Act, 1961, ss. 143(3), 154, 158BC-- CIT v. Soora Subramanian  (Mad) . . . 591

Revision --Limitation--Order of assessment subject of rectification--Notice for revision on issue not affected by rectification and referring to order of assessment--Limitation to be reckoned from date of assessment order, not date of rectification--Income-tax Act, 1961, ss. 143, 154, 263-- CIT v. Shriram Engineering Construction Co. Ltd . (Mad) . . . 568

Scrutiny of cases --Circular--Circular prescribing time limit of three months for scrutiny for returns filed in financial year 2004-05--Circular binding on Revenue authorities--CBDT Instruction No. 9 of 2004, dated September 20, 2004--Income-tax Act, 1961, s. 119-- Deputy CIT v. Sunita Finlease Ltd. (Chhattisgarh) . . . 491

Search and seizure --Block assessment--Undisclosed income--Definition--No valid return of income filed by assessee for any of the years of block period--Response to notice issued under section 131 not disclosure for the purpose of Act--Onus on assessee to disclose undisclosed income by way of return before commencement of search--Block assessment on materials seized on search valid--Matter remanded--Income-tax Act, 1961, ss. 132, 158BB, 158BC, 158BD-- CIT v. Sivabala Devi (Mad) . . . 510

----Block assessment--Warrant of authorisation issued in joint names of husband and wife--Individual assessment on wife alone--Not valid--Income-tax Act, 1961, s. 158BC-- CIT v. Smt. Vandana Verma (All) . . . 533

 

SECTIONWISE INDEX TO CASES REPORTED IN THIS PART

Finance Act, 1997 :

Ss. 68, 71, 72 --Reassessment--Unexplained money--Presumption that represents income of year in which found--Voluntary disclosure under 1997 Scheme of assets stated to be acquired in 1985-86 and 1986-87--Declaration becoming invalid for failure to pay tax--Reassessment for assessment year 1998-99 on basis of disclosure--Permissible-- CIT v. Prem Pal (P&H) . . . 499

Income-tax Act, 1961 :

S. 14A --Deductions--Law applicable--Section 14A prohibiting deduction of expenses relating to non-taxable income--Circular of CBDT dated 23-7-2001 stating that concluded assessments could not be reopened for purposes of section 14A--Meaning of "concluded assessment"--Assessment which could be modified by higher authority not a concluded assessment till expiry of time-limit for such modification--Assessment order remanded for modification in appeal--Subsequent revision of order--Permissible--CBDT Circular 11 dated 23-7-2001 (250 ITR (St.) 84)-- Catholic Syrian Bank Ltd . v. CIT (Ker) . . . 556

S. 36(1)(iii) --Interest on borrowed capital--Disallowance on ground that a part of amount given to subsidiary company--Revenue failing to establish that loan given for only personal purposes--Finding that interest not to be disallowed--Justified-- CIT v. Dalmia Cement Bharat Ltd. (Delhi) . . . 595

S. 37 --Interest on borrowed capital--Disallowance on ground that a part of amount given to subsidiary company--Revenue failing to establish that loan given for only personal purposes--Finding that interest not to be disallowed--Justified-- CIT v. Dalmia Cement Bharat Ltd. (Delhi) . . . 595

S. 40A(2)(b) --Business expenditure--Disallowance--Excessive and unreasonable payments--Addition for purchases and sales made from sister concern--Finding by Commissioner (Appeals) as well as Tribunal as to genuineness of valuation in transaction between sister concerns not perverse--Findings of fact-- CIT v. Jyoti Industries  (P&H) . . . 573

----Business expenditure--Disallowance--Excessive or unreasonable payments--Trade discount--Discount allowed to sister concern--Assessee claiming 11 per cent. on ground of bulk sales--Assessing Officer allowing 3 per cent., Commissioner (Appeals) enhancing to 8 per cent. while Tribunal reducing to 5 per cent.--Assessee allowed 11 per cent. in earlier years--Assessee entitled to 11 per cent.--Trade discount not an expendi-ture--Section 40A(2)(b) does not apply-- United Exports v. CIT  (Delhi) . . . 549

S. 55A --Capital gains--Valuation of capital asset--Reference to Departmental Valuation Officer--Condition precedent--Opinion of Assessing Officer that value claimed is less than fair market value-- CIT v. Umedbhai International P. Ltd.  (Cal) . . . 506

S. 68 --Cash credits--Burden of proof--Initial burden on assessee to prove identity of creditors--Burden then shifts to Revenue to prove credits were not genuine--Identity of applicants for shares and their PAN numbers furnished--Amounts received through account payee cheques--Inability to find a few applicants--Not sufficient to invoke section 68-- CIT v. Winstral Petrochemicals P. Ltd . (Delhi) . . . 603

S. 69A --Reassessment--Unexplained money--Presumption that represents income of year in which found--Voluntary disclosure under 1997 Scheme of assets stated to be acquired in 1985-86 and 1986-87--Declaration becoming invalid for failure to pay tax--Reassessment for assessment year 1998-99 on basis of disclosure--Permissible-- CIT v. Prem Pal (P&H) . . . 499

S. 119 --Circulars--Scope of-- Deputy CIT v. Sunita Finlease Ltd.  (Chhattisgarh) . . . 491

----Scrutiny of cases--Circular--Circular prescribing time limit of three months for scrutiny for returns filed in financial year 2004-05--Circular binding on Revenue authorities--CBDT Instruction No. 9 of 2004, dated September 20, 2004-- Deputy CIT v. Sunita Finlease Ltd. (Chhattisgarh) . . . 491

S. 132 --Search and seizure--Block assessment--Undisclosed income--Definition--No valid return of income filed by assessee for any of the years of block period--Response to notice issued under section 131 not disclosure for the purpose of Act--Onus on assessee to disclose undisclosed income by way of return before commencement of search--Block assessment on materials seized on search valid--Matter remanded-- CIT v. Sivabala Devi (Mad) . . . 510

S. 143 --Revision--Limitation--Order of assessment subject of rectification--Notice for revision on issue not affected by rectification and referring to order of assessment--Limitation to be reckoned from date of assessment order, not date of rectification-- CIT v. Shriram Engineering Construction Co. Ltd . (Mad) . . . 568

S. 143(3) --Rectification of mistakes--Loss--Set-off--Debatable issue not mistake apparent from record--Wrong allowance of set off of losses could not be rectified under section 154-- CIT v. Soora Subramanian (Mad) . . . 591

S. 147 --Reassessment--Unexplained money--Presumption that represents income of year in which found--Voluntary disclosure under 1997 Scheme of assets stated to be acquired in 1985-86 and 1986-87--Declaration becoming invalid for failure to pay tax--Reassessment for assessment year 1998-99 on basis of disclosure--Permissible-- CIT v. Prem Pal (P&H) . . . 499

S. 148 --Reassessment--Unexplained money--Presumption that represents income of year in which found--Voluntary disclosure under 1997 Scheme of assets stated to be acquired in 1985-86 and 1986-87--Declaration becoming invalid for failure to pay tax--Reassessment for assessment year 1998-99 on basis of disclosure--Permissible-- CIT v. Prem Pal (P&H) . . . 499

S. 154 --Rectification of mistakes--Loss--Set-off--Debatable issue not mistake apparent from record--Wrong allowance of set off of losses could not be rectified under section 154-- CIT v. Soora Subramanian (Mad) . . . 591

----Revision--Limitation--Order of assessment subject of rectification--Notice for revision on issue not affected by rectification and referring to order of assessment--Limitation to be reckoned from date of assessment order, not date of rectification-- CIT v. Shriram Engineering Construction Co. Ltd . (Mad) . . . 568

S. 158BB --Search and seizure--Block assessment--Undisclosed income--Definition--No valid return of income filed by assessee for any of the years of block period--Response to notice issued under section 131 not disclosure for the purpose of Act--Onus on assessee to disclose undisclosed income by way of return before commencement of search--Block assessment on materials seized on search valid--Matter remanded-- CIT v. Sivabala Devi (Mad) . . . 510

S. 158BC --Rectification of mistakes--Loss--Set-off--Debatable issue not mistake apparent from record--Wrong allowance of set off of losses could not be rectified under section 154-- CIT v. Soora Subramanian (Mad) . . . 591

----Search and seizure--Block assessment--Undisclosed income--Definition--No valid return of income filed by assessee for any of the years of block period--Response to notice issued under section 131 not disclosure for the purpose of Act--Onus on assessee to disclose undisclosed income by way of return before commencement of search--Block assessment on materials seized on search valid--Matter remanded-- CIT v. Sivabala Devi (Mad) . . . 510

----Search and seizure--Block assessment--Warrant of authorisation issued in joint names of husband and wife--Individual assessment on wife alone--Not valid-- CIT v. Smt. Vandana Verma (All) . . . 533

S. 158BD --Search and seizure--Block assessment--Undisclosed income--Definition--No valid return of income filed by assessee for any of the years of block period--Response to notice issued under section 131 not disclosure for the purpose of Act--Onus on assessee to disclose undisclosed income by way of return before commencement of search--Block assessment on materials seized on search valid--Matter remanded-- CIT v. Sivabala Devi (Mad) . . . 510

S. 192 --Deduction of tax at source--Salary--Effect of sub-section (3) of section 192--Default in deduction can be made up during financial year-- CIT v. Enron Expat Services Inc. (Uttarakhand) . . . 496

S. 201 --Advance tax--Interest--Non-resident--Entire income liable to deduction of tax at source--Assessee not liable for advance tax--Cannot be charged interest for failure to pay advance tax-- Director of Income-tax v. Jacabs Civil Incorporated  (Delhi) . . . 578

----Deduction of tax at source--Salary--Effect of sub-section (3) of section 192--Default in deduction can be made up during financial year-- CIT v. Enron Expat Services Inc. (Uttarakhand) . . . 496

S. 209 --Advance tax--Interest--Non-resident--Entire income liable to deduction of tax at source--Assessee not liable for advance tax--Cannot be charged interest for failure to pay advance tax-- Director of Income-tax v. Jacabs Civil Incorporated  (Delhi) . . . 578

S. 220(2A) --Recovery of tax--Interest on delayed payment of tax--Waiver of interest--Conditions precedent--Conditions laid down in section 220(2A) are cumulative--Payment of interest whether would cause genuine hardship to assessee--Income of relevant period to be taken into account--Past liabilities not relevant--Finding that payment of interest would not cause genuine hardship--Refusal to waive interest--Justified-- P. Sudhakaran v. Deputy CIT (Ker) . . . 488

----Recovery of tax--Interest--Waiver of interest--Law applicable--Section 220(2A) inserted with effect from 1-10-1984--Not applicable where assessments completed and demand notices issued before 1-10-1984--Writ petition challenging validity of provision--Failure to pay tax under disputed provision--Presumption of validity of provision--Provision subsequently held valid by Supreme Court--Levy of interest justified-- Prakash Tubes Ltd. v. Union of India (Delhi) . . . 561

S. 234B --Advance tax--Interest--Non-resident--Entire income liable to deduction of tax at source--Assessee not liable for advance tax--Cannot be charged interest for failure to pay advance tax-- Director of Income-tax v. Jacabs Civil Incorporated  (Delhi) . . . 578

S. 234D --Interest--Interest on excess refund--Provision not applicable prior to assessment year 2004-05-- Director of Income-tax v. Jacabs Civil Incorporated  (Delhi) . . . 578

S. 263 --Revision--Limitation--Order of assessment subject of rectification--Notice for revision on issue not affected by rectification and referring to order of assessment--Limitation to be reckoned from date of assessment order, not date of rectification-- CIT v. Shriram Engineering Construction Co. Ltd . (Mad) . . . 568

S. 271(1)(c) --Penalty--Assessee claiming revenue expenditure--Penalty imposed holding expenditure capital--Finding by Commissioner (Appeals) as well as Tribunal that issue debatable--Penalty not attracted-- CIT v. Krishna Maruti Ltd.  (Delhi) . . . 547

----Penalty--Concealment of income--Assessee computing pre-operative expenses after deducting interest and showing in balance-sheet filed along with return of income--Assessing Officer holding that interest cannot be adjusted against pre-operative expenses--Not a case of concealment of income--Penalty cannot be imposed-- CIT v. Mushashi Autoparts India P. Ltd. (Delhi) . . . 545

 

ITR'S TRIBUNAL TAX REPORTS (ITR (TRIB))

Volume 7 : Part 5 (Issue dated : 31-1-2011)

SUBJECT INDEX TO CASES REPORTED IN THIS PART

Appeal to Appellate Tribunal --Jurisdiction--Restricted to subject-matter of appeal --Not confined to grounds raised in appeal--Decision on any other ground may be given after affording an opportunity to affected party--Income-tax Act, 1961, s. 254--Income-tax (Appellate Tribunal) Rules, 1963, r. 11--J oint CIT v. Reuters Ltd. (Mumbai) . . . 422

----Powers--Ground not set forth in appeal--Ground regarding existence of permanent establishment--No definite finding--Non-resident and Indian company whether associated enterprises--Deputation of employee of non-resident to Indian company to render services whether indication of Indian company service permanent establishment of non-resident--Plea within parameters of grounds of appeal to Tribunal--Matter remanded--Double Taxation Avoidance Agreement between India and the U. K. art. 5(2)(k), (5)-- Joint CIT v. Reuters Ltd. (Mumbai) . . . 422

Assessment --Estimation of income--Gross profit rate--Rejection of books of account--Additions on basis of books of account arbitrary--Assessing Officer estimating income on basis of gross profit rate--Justified--Income-tax Act, 1961-- Asst. CIT v. Lakshmi Industries (Chennai) . . . 495

Capital gains --Computation of capital gains--Assessees acquiring property by inheritance--Indexation to be with reference to year in which previous owner acquired asset--Property acquired by previous owner prior to 1-4-1981--Cost inflation index relating to financial year 1981-82 to be adopted--Income-tax Act, 1961, s. 2(42A), Expln. 1(b)-- M. Siva Parvathi v. ITO (Visakhapatnam) . . . 468

----Computation of capital gains--Deductions--Sale of house property acquired by inheritance--Payment made to persons claiming to be legal heirs--Expenditure incurred in removing encumbrance to transfer--Payments to tenants--Deductible--Income-tax Act, 1961-- M. Siva Parvathi v. ITO (Visakhapatnam) . . . 468

----Computation of capital gains--Property acquired by inheritance--Agreement to sell entered into prior to introduction of section 50C--Delay in registering sale deed due to genuine reasons--Completion of transaction after introduction of section 50C--Section 50C not applicable--Income-tax Act, 1961, s. 50C-- M. Siva Parvathi v. ITO (Visakhapatnam) . . . 468

----Exemption--Investment of net consideration in construction of "a residential house" and purchase of flat--Exemption restricted to investment in construction of residential house--Income-tax Act, 1961, s. 54-- M. Siva Parvathi v. ITO (Visakhapatnam) . . . 468

Deduction of tax at source --Works contract--Film finance--Assessee advancing money for production of film--Amount recoverable from producer of film--Assessee given certain rights--Agreement did not result in works contract--Assessee not liable to deduct tax at source on advances--Income-tax Act, 1961, s. 194C-- Muktha Arts v. Asst. CIT (Mumbai) . . . 517

Export --New industrial undertaking engaged in export--Deduction of 100 per cent. profits under section 10B--Assessee manufacturing and exporting garments--Forward contracts to protect sales from exchange fluctuations--Transaction speculative in character--Profits from forward contracts derived from speculation business--Not entitled to deduction under section 10B--Income-tax Act, 1961, ss. 10B, 28, Expln. 2-- Asst. CIT v. K. Mohan and Co. (Exports) P. Ltd. (Bangalore) . . . 507

Penalty --Concealment of income--Assessee agreeing to addition of unexplained credit on realising creditor will not co-operate--All details regarding identity of creditor and genuineness of transaction furnished by assessee--Failure to produce creditor to prove transaction to satisfaction of Assessing Officer--Imposition of penalty not justified--Income-tax Act, 1961, s. 271(1)(c)-- New Raja Jewellery v. ITO (Chennai) . . . 459

----Concealment of income--Disallowance of deductions on software expenditure and meal expenses accepted by assessee--Penalty cannot be imposed merely because assessee allowed matter to attain finality--Income-tax Act, 1961, s. 271(1)(c)-- Deputy CIT v. Boston Consulting Group (India) P. Ltd. (Mumbai) . . . 417

Revision --Commissioner--Show-cause notice by Income-tax Officer on proposal by Joint Commissioner--Assessment order not examined prior to initiation of revision proceedings--No application of mind by Commissioner--Revision order void ab initio--Income-tax Act, 1961, s. 263-- Jheendu Ram v. CIT (Lucknow) . . . 463

Search and seizure --Block assessment--Scope of section 158BC--Assessing Officer acquires jurisdiction to initiate block assessment only on issue of notice--Notice not mere procedural requirement--Notice to be issued by registered post acknowledgment due--Return to be filed thereafter--Income-tax Act, 1961, s. 158BC-- Asst. CIT v. Lakshmi Industries (Chennai) . . . 495

----Block assessment--Validity--Notice--Service of notice--No material to prove notice served on assessee--Failure on part of Department to issue notice despite information regarding non-receipt of notice by assessee--Expiry of time to issue notice when assessee filed return--Proceedings null and void ab initio--Income-tax Act, 1961, s. 158BC-- Asst. CIT v. Lakshmi Industries (Chennai) . . . 495

----Undisclosed income--Investments in power looms, rental income from hiring of looms and unexplained loans--Investments made prior to 1999--Addition cannot be made in 2002-03--Gross monthly rent of power loom determined based on seized material--Twenty per cent. deduction allowable on expenses incurred--Cash flow statement with regard to loans not properly considered by Assessing Officer--Matter remanded--Income-tax Act, 1961, s. 69-- Masoomkhan Shabbirkhan Pathan v. Deputy CIT (Mumbai) . . . 443

Words and phrases --"Thereon", "Pass such orders as Tribunal thinks fit"-- Joint CIT v. Reuters Ltd. (Mumbai) . . . 422

 

SECTIONWISE INDEX TO CASES REPORTED IN THIS PART

Double Taxation Avoidance Agreement between India and the U. K. :

Art. 5(2)(k), (5) --Appeal to Appellate Tribunal--Powers--Ground not set forth in appeal--Ground regarding existence of permanent establishment--No definite finding--Non-resident and Indian company whether associated enterprises--Deputation of employee of non-resident to Indian company to render services whether indication of Indian company service permanent establishment of non-resident--Plea within parameters of grounds of appeal to Tribunal--Matter remanded-- Joint CIT v. Reuters Ltd. (Mumbai) . . . 422

Income-tax (Appellate Tribunal) Rules, 1963 :

R. 11 --Appeal to Appellate Tribunal--Jurisdiction--Restricted to subject-matter of appeal--Not confined to grounds raised in appeal--Decision on any other ground may be given after affording an opportunity to affected party--J oint CIT v. Reuters Ltd. (Mumbai) . . . 422

Income-tax Act, 1961 :

S. 2(42A), Expln. 1(b) --Capital gains--Computation of capital gains--Assessees acquiring property by inheritance--Indexation to be with reference to year in which previous owner acquired asset--Property acquired by previous owner prior to 1-4-1981--Cost inflation index relating to financial year 1981-82 to be adopted-- M. Siva Parvathi v. ITO (Visakhapatnam) . . . 468

S. 10B --Export--New industrial undertaking engaged in export--Deduction of 100 per cent. profits under section 10B--Assessee manufacturing and exporting garments--Forward contracts to protect sales from exchange fluctuations--Transaction speculative in character--Profits from forward contracts derived from speculation business--Not entitled to deduction under section 10B-- Asst. CIT v. K. Mohan and Co. (Exports) P. Ltd. (Bangalore) . . . 507

S. 28, Expln. 2 --Export--New industrial undertaking engaged in export--Deduction of 100 per cent. profits under section 10B--Assessee manufacturing and exporting garments--Forward contracts to protect sales from exchange fluctuations--Transaction speculative in character--Profits from forward contracts derived from speculation business--Not entitled to deduction under section 10B-- Asst. CIT v. K. Mohan and Co. (Exports) P. Ltd. (Bangalore) . . . 507

S. 50C --Capital gains--Computation of capital gains--Property acquired by inheritance--Agreement to sell entered into prior to introduction of section 50C--Delay in registering sale deed due to genuine reasons--Completion of transaction after introduction of section 50C--Section 50C not applicable-- M. Siva Parvathi v. ITO (Visakhapatnam) . . . 468

S. 54 --Capital gains--Exemption--Investment of net consideration in construction of "a residential house" and purchase of flat--Exemption restricted to investment in construction of residential house-- M. Siva Parvathi v. ITO (Visakhapatnam) . . . 468

S. 69 --Search and seizure--Undisclosed income--Investments in power looms, rental income from hiring of looms and un-explained loans--Investments made prior to 1999--Addition cannot be made in 2002-03--Gross monthly rent of power loom determined based on seized material--Twenty per cent. deduction allowable on expenses incurred--Cash flow statement with regard to loans not properly considered by Assessing Officer--Matter remanded-- Masoomkhan Shabbirkhan Pathan v. Deputy CIT (Mumbai) . . . 443

S. 158BC --Search and seizure--Block assessment--Scope of section 158BC--Assessing Officer acquires jurisdiction to initiate block assessment only on issue of notice--Notice not mere procedural requirement--Notice to be issued by registered post acknowledgment due--Return to be filed thereafter-- Asst. CIT v. Lakshmi Industries (Chennai) . . . 495

----Search and seizure--Block assessment--Validity--Notice--Service of notice--No material to prove notice served on assessee--Failure on part of Department to issue notice despite information regarding non-receipt of notice by assessee--Expiry of time to issue notice when assessee filed return--Proceedings null and void ab initio-- Asst. CIT v. Lakshmi Industries (Chennai) . . . 495

S. 194C --Deduction of tax at source--Works contract--Film finance--Assessee advancing money for production of film--Amount recoverable from producer of film--Assessee given certain rights--Agreement did not result in works contract--Assessee not liable to deduct tax at source on advances-- Muktha Arts v. Asst. CIT (Mumbai) . . . 517

S. 254 --Appeal to Appellate Tribunal--Jurisdiction--Restricted to subject-matter of appeal --Not confined to grounds raised in appeal--Decision on any other ground may be given after affording an opportunity to affected party--J oint CIT v. Reuters Ltd. (Mumbai) . . . 422

S. 263 --Revision--Commissioner--Show-cause notice by Income-tax Officer on proposal by Joint Commissioner--Assessment order not examined prior to initiation of revision proceedings--No application of mind by Commissioner--Revision order void ab initio-- Jheendu Ram v. CIT (Lucknow) . . . 463

S. 271(1)(c) --Penalty--Concealment of income--Assessee agreeing to addition of unexplained credit on realising creditor will not co-operate--All details regarding identity of creditor and genuineness of transaction furnished by assessee--Failure to produce creditor to prove transaction to satisfaction of Assessing Officer--Imposition of penalty not justified-- New Raja Jewellery v. ITO (Chennai) . . . 459

----Penalty--Concealment of income--Disallowance of deductions on software expenditure and meal expenses accepted by assessee--Penalty cannot be imposed merely because assessee allowed matter to attain finality--Deputy CIT v. Boston Consulting Group (India) P. Ltd. (Mumbai) . . . 417

 

.

__,_._,___

Tuesday, January 25, 2011

Supreme Court on Renting On 24th January - Service Tax

---------- Forwarded message ----------
From: Rebecca Andrews <rebecca.andrews88@yahoo.in>
Date: Sun, Jan 23, 2011 at 9:23 PM
Subject: {jalgaoncas} Supreme Court on Renting On 24th January - Service Tax
To:


My senior Mr. Rakesh Chitkara, Advocate, Delhi High Court has forwarded the following text :


Supreme Court will hear a clutch of petitions on service tax on renting where the plea will be made to restore the stay granted to Home Solutions by Delhi High Court (DHC) and vacated by SC on 10th Jan. 


Hearing is of the SLP filed by the Govt. against the orders pronounced by DHC in 2009 holding that renting is not a service, per se. SC has yet to hear the main petition and pronounce its judgement. 


As per the statistics of the CBEC, nearly 70,000 crores is riding on this dispute. Delhi High Court is scheduled to hear the main petition the next day, i.e. on 25th January, 2011.


It has been a conscious decision for our clients not to take their matter to the Supreme Court as yet, and burden them with additional costs. 

SUPREME COURT OF INDIA

Daily Cause List

( For 24th, January, 2011 )

 

                                      COURT NO. 13

                         HON'BLE DR. JUSTICE MUKUNDAKAM SHARMA

                         HON'BLE MR. JUSTICE ANIL R. DAVE

                         --------------------------------

                         PART-A     MISCELLANEOUS MATTERS

                         --------------------------------

          I.A.,CMPS,CRLMPS ETC.

          ---------------------

 


          -----------------------------------------

 

2.  SLP(C)No.13850/2009 UNION OF INDIA & ORS.           MR. ARVIND KUMAR SHARMA

       III  A/N-H         Vs. HOME SOLUTION RETAIL INDIA     MR. E.C. AGRAWALA

      S.( 431)(29/05/2009)    LTD. & ORS.                    MS. N.ANNAPOORANI

                              (WITH APPLN.(S) FOR EXEMPTION FROM

       2ND LISTING             FILING C/C OF THE IMPUGNED

                               JUDGMENT AND WITH PRAYER FOR

                               INTERIM RELIEF)

      WITH

           T.P.(C)No.686-707/2009 UNION OF INDIA             MR. SHREEKANT N. TERDAL

       XVIA A/N-H         Vs. A.P.SELVARAJAN & ORS.          MS. SHIRIN KHAJURIA

      S.(1801)(28/07/2009)    (WITH APPLN.(S) FOR STAY AND        MR. E.C. AGRAWALA

       2ND LISTING             VACATING STAY)                     MR. PRAVEEN KUMAR

          MR. SUBRAMONIUM PRASAD, MR. R. PRAKASH, M/S. M.V. KINI & ASSOCIATES,

           SLP(C)No.36137-36158/2009 UNION OF INDIA & ORS.   MR. B. KRISHNA PRASAD

       III  A/N-O         Vs. M/S LIFESTYLE INTERNATIONAL P. M/S. O.P. KHAITAN  CO

      S.( 431)(09/12/2009)    LTD.&ORS.                      MR. SANJAY JAIN

                              (WITH APPLN.(S) FOR EXEMPTION FROM  MS.JYOTI MENDIRATTA

       2ND LISTING             FILING C/C OF THE IMPUGNED         MR.CHIRAG M.SHROFF

                               JUDGMENT AND OFFICE REPORT)

           SLP(C)No.36269/2009 UNION OF INDIA & ORS.         MR. B. KRISHNA PRASAD

       III  A/N-O         Vs. M/S MADHUR IMPEX & ORS.

      S.( 431)(07/12/2009)    (WITH PRAYER FOR INTERIM RELIEF)

       2ND LISTING

           SLP(C)No.36270/2009 UNION OF INDIA & ANR.         MR. B. KRISHNA PRASAD

       III  A/N-O         Vs. DIVYA KALRA

      S.( 431)(14/12/2009)    (WITH PRAYER FOR INTERIM RELIEF)

       2ND LISTING

           SLP(C)No.2460/2010 UNION OF INDIA & ORS.          MR. B. KRISHNA PRASAD

       III  A/N-O         Vs. BAJAJ JEWELS(I) P.LTD.& ORS.

      S.( 431)(02/01/2010)    (WITH PRAYER FOR INTERIM RELIEF)

       2ND LISTING

           SLP(C)No.4685/2010 UNION OF INDIA & ORS.          MR. B. KRISHNA PRASAD

       III  A/N-O         Vs. HARIKIRAT SODHI

      S.( 431)(20/01/2010)    (WITH APPLN.(S) FOR PERMISSION TO   MR. SANJAY SHARAWAT

       2ND LISTING             FILE AFFIDAVIT AND WITH PRAYER

                               FOR INTERIM RELIEF)

           SLP(C)No.4316-4323/2010 UNION OF INDIA & ORS.     MR. B. KRISHNA PRASAD

       III  A/N-O         Vs. JANAK PLACE MARKET ASSN.& ORS. M/S. O.P. KHAITAN  CO

      S.( 431)(17/12/2009)    (WITH APPLN.(S) FOR EXEMPTION FROM

       2ND LISTING             FILING C/C OF THE IMPUGNED

                               JUDGMENT AND WITH PRAYER FOR

                               INTERIM RELIEF)

           C.A.No.4486/2010 UNION OF INDIA & ORS.            MR. B. KRISHNA PRASAD

       III                Vs. UTV SOFTWARE COMMUNICATIONS    MR. ANKUR MITTAL

      S.( 431)                LTD.

                              (WITH OFFICE REPORT)

       1ST LISTING

           C.A.No.4487/2010 UNION OF INDIA AND ORS.          MR. B. KRISHNA PRASAD

       III                Vs. UTV NEWS LTD.                  MR. ANKUR MITTAL

      S.( 431)                (WITH OFFICE REPORT)

       1ST LISTING

           SLP(C)No.26373/2010 UNION OF INDIA & ORS.         MRS ANIL KATIYAR

       III  A/N-O         Vs. DEVYANI INTERNATIONAL LTD.&

      S.( 431)(26/08/2010)    ORS.

                              (WITH APPLN.(S) FOR C/DELAY IN

       2ND LISTING             FILING SLP AND C/DELAY IN

                               REFILING SLP AND OFFICE REPORT)

           SLP(C)No.31324/2010 UNION OF INDIA                MR. B. KRISHNA PRASAD

       III  A/N-O         Vs. M/S FLAMINGO DUTY SHOPS PVT.   M/S. M.V. KINI & ASSOCIATES

      S.( 431)(07/10/2010)    LTD & ANR.                     M/S SURESH A. SHROFF & CO

                              (WITH APPLN.(S) FOR C/DELAY IN

       2ND LISTING             FILING SLP AND EXEMPTION FROM

                               FILING C/C OF THE IMPUGNED ORDER

                               AND OFFICE REPORT)

           T.P.(C)No.236/2007 AIRPORTS AUTHORITY OF INDIA    M/S. M.V. KINI & ASSOCIATES

       XVIA A/N-H             ETC. Vs. M/S FELMINGO DUTY     M/S GAGRAT & CO

      S.(1801)(05/04/2007)    FREE SHOPS P.LTD.& ANR         MR. B. KRISHNA PRASAD

                              (WITH APPLN.(S) FOR DIRECTIONS AND  M/S SURESH A. SHROFF & CO

       5TH LISTING             STAY AND OFFICE REPORT)            MR. V. BALACHANDRAN

          MRS LALITA KAUSHIK, MR. ABHIJAT P. MEDH, MR. M.A.CHINNASAMY,

          MR. SANJAY R. HEGDE, MS. KAVITA WADIA,

            T.P.(C)No.630-641/2007                           M/S. M.V. KINI & ASSOCIATES

       XVIA A/N-H             AIRPORTS AUTHORITY OF INDIA & M/S. PAREKH & CO

      S.(1801)(29/08/2007)    ORS. Vs. M/S HIGGINBOTHAMS     MR. B. KRISHNA PRASAD

       2ND LISTING            PVT.LTD.& ORS.                 MS. KAVITA WADIA

                              (WITH APPLN.(S) FOR DIRECTIONS AND  MR.M.P.DEVANATH

                               STAY AND OFFICE REPORT)

           T.P.(C)No.54-57/2008 AIRPORT AUTHORITY OF INDIA   M/S. M.V. KINI & ASSOCIATES

       XVIA A/N-H         Vs. MD.AKHTAR HUSSAIN KHAN & ORS.  MR. BIJOY KUMAR JAIN

      S.(1801)(16/01/2008)    (WITH APPLN.(S) FOR SUBSTITUTED     MR. DHARAM BIR RAJ VOHRA

       2ND LISTING             SERVICE AND STAY)                  MR. B.V. BALARAM DAS

           T.P.(C)No.451/2010 AIRPORT DIR.AIRPORT AUTH.OF    M/S. M.V. KINI & ASSOCIATES

       XVIA A/N-H             INDIA & ANR                    M/S. T.T.K. DEEPAK & CO

      S.(1802)(30/04/2010)Vs. C.SADANANDAN & ORS.

                              (WITH OFFICE REPORT)

       2ND LISTING

           T.P.(C)No.807-821/2008 UNION OF INDIA & ORS.      MR. B.V. BALARAM DAS

       XVIA A/N-H         Vs. RETAILERS ASSOCIACTION OF      MR. E.C. AGRAWALA

      S.(1801)(04/08/2008)    INDIA & ORS.                   MR. DINESH KUMAR GARG

                              (WITH APPLN.(S) FOR STAY)           MR. E.C. AGRAWALA

       2ND LISTING

          MR. RAJAN NARAIN, MR. NIKHIL NAYYAR, MS. LIZ MATHEW, MR. R.CHANDRACHUD,

           SLP(C)No.9013/2007 AJAY PAL REDDY                 MR. BIJOY KUMAR JAIN

       III  A/N-H         Vs. AIRPORT AUTHORITY OF INDIA &   M/S. M.V. KINI & ASSOCIATES

      S.( 431)(11/05/2007)    ORS.                           MR. B. KRISHNA PRASAD

                              (WITH PRAYER FOR INTERIM RELIEF

       5TH LISTING             AND OFFICE REPORT)

           T.P.(C)No.738-796/2009 UNION OF INDIA & ORS.      MRS ANIL KATIYAR

       XVIA A/N-H         Vs. G.S.G.BUILDERS & INFRASTR.LTD. M/S. KHAITAN & CO

      S.(1802)(04/08/2009)    & ORS.                         MR. E.C. AGRAWALA

                              (WITH APPLN.(S) FOR STAY AND        MR. M.P. JHA

       2ND LISTING             OFFICE REPORT)                     MR. ANIL KUMAR TANDALE

          MR. Y. RAJA GOPALA RAO, M/S. K.J. JOHN & CO, MR. SANJAY JAIN,

          MS. KAVITA WADIA, M/S.MAHALAKSHMI BALAJI & CO, MR. G.N.REDDY,

          MR. ANIL KUMAR MISHRA,

           W.P.(C)No.147/2009 RAKESH MAHAJAN                 MR. M.A.CHINNASAMY

       X    ADJD-H        Vs. UNION OF INDIA & ORS.

      S.( 431)(02/04/2009)    (WITH APPLN.(S) FOR INTERIM RELIEF

       2ND LISTING             AND PERMISSION TO FILE ADDITIONAL

                               DOCUMENTS AND OFFICE REPORT)

 

Kind regards,

Rebecca Andrews