INCOME TAX REPORTS (ITR)
Volume 337 : Part 2 (Issue dated 19-9-2011)
SUBJECT INDEX TO CASES REPORTED IN THIS PART
Capital gains or business income --Consideration received on transfer of rights of trade mark, brands, copyrights in journals and publications--Business given up distinct from business continued--Consideration not arising out of business but is long-term capital gains--Section 28(va) does not apply--Income-tax Act, 1961, s. 28(va)-- CIT v. Mediworld Publications Pvt. Ltd. (Delhi) . . . 178
Income from other sources --Compulsory acquisition of agricultural land--Enhanced compensation--Interest on delayed payment--Claim to spread over on accrual basis but interest for two years alone disclosed--Inference of cash system of accounting--Interest taxable in year of receipt--Land Acquisition Act, 1894, s. 34--Income-tax Act, 1961, s. 145-- CIT v. Karambir Singh (P&H) . . . 159
Income from undisclosed sources --Assessee failing to prove capacity of creditor and genuineness of transaction--Finding that transaction bogus and sustaining addition--Disallowance of excess claim on account of loss of bardana--Findings of fact--Income-tax Act, 1961-- Papneja Traders v. CIT (P&H) . . . 172
Offences and prosecution --Compounding of offences--Guidelines issued by CBDT--Compounding permissible for technical offences--Compounding not possible after filing of complaint--Income-tax Act, 1961, s. 276B-- Anil Batra v. Chief CIT (Delhi) . . . 251
Penalty --Concealment of income--Search and seizure--Assessee making disclosure statement under section 132(4)--Time for filing return not expired--Income included in return and tax paid--Not a case of concealment of particulars of income--Penalty cannot be imposed--Income-tax Act, 1961, s. 271(1)(c), Expln. 5-- CIT v. Bhandari Silk Store (P&H) . . . 153
Reassessment --Notice after four years--No failure to disclose material facts necessary for assessment--Deduction allowed in original assessment after considering facts--Reassessment proceedings after four years to disallow deduction on ground it was capital expenditure--Not valid--Income-tax Act, 1961, ss. 147, 148-- Parle Sales and Services P. Ltd. v. ITO (Guj) . . . 203
Search and seizure --Block assessment--Assessment of third person--Condition precedent--Satisfaction of Assessing Officer of person searched that undisclosed income discovered during search belonged to third person--Meaning of satisfaction--Letter by Assessing Officer of person searched that assessee acted as mediator in bogus accommodation transactions--No evidence that assessee had given cash to person searched or had received commission--Condition not fulfilled--Block assessment of assessee--Not valid--Income-tax Act, 1961, ss. 158B, 158BD-- CIT v. Radhey Shyam Bansal (Delhi) . . . 217
----Block assessment--Undisclosed income--Addition permissible only in respect of material discovered during search--Estimate of expenditure on house by Valuation Officer--No material recovered in search showing expenditure beyond that recorded in books--Addition solely on basis of estimate--Not valid--Income-tax Act, 1961, s. 158BD-- CIT v. Kantilal B. Kansara (HUF) (Guj) . . . 187
----Block assessment--Undisclosed income--Statement under section 132(4)--Admissibility--Addition based on confessional statement made by assessee and counter-signature by his sons--Failure by assessee to prove that confession was as a result of intimidation, duress and coercion--No evidence that confession made as a result of mistaken belief of law or facts--Addition justified--Income-tax Act, 1961, s. 132(4)-- Asst. CIT v. Hukum Chand Jain (Chhattisgarh) . . . 238
Non-resident --Prospecting for or extraction of mineral oils--Services in connection therewith--Special provisions for computation of income--Tax resident of Norway providing sea logistics services for ONGC--Not technical services but transportation--Fall within purview of special provisions--But under DTAA notional income restricted to 7.5 per cent. of receipts and tax limited to 50 per cent. of tax imposed by India--No deduction for service tax--Income-tax Act, 1961, ss. 9(1)(vii), 44BB--Finance Act, 1994, s. 68--Double Taxation Avoidance Agreement between India and Norway, art. 23(4)-- Siem Offshore Inc ., In re . . . 207
----Rate of tax--Prospecting for, or extraction or production of, mineral oils--Service of conducting seismic surveys and providing onshore seismic data acquisition and other associated services--Taxable under special provision--Entire receipts subject to deeming provision--Income cannot be split--Income-tax Act, 1961, s. 44BB-- Bergen Oilfield Services AS, Norway , In re . . . 167
----Taxability in India--Deduction of tax at source--Employees of non-resident company deputed to Indian subsidiary for performing managerial functions--Salary and benefits paid to expatriate employees by non-resident employer and reimbursed by Indian company--Are fees for included services accruing to non-resident company--Requirement of "making available" technical know-how not applicable--Tax deductible at source--Income-tax Act, 1961, ss. 9(1)(vii), Expln. 2, 195--Double Taxation Avoidance Agreement between India and the U.S.A., art. 12(4)(b)-- Verizon Data Services India Private Ltd ., In re . . . 192
SECTIONWISE INDEX TO CASES REPORTED IN THIS PART
Double Taxation Avoidance Agreement between India and Norway :
Art. 23(4) --Non-resident--Prospecting for or extraction of mineral oils--Services in connection therewith--Special provisions for computation of income--Tax resident of Norway providing sea logistics services for ONGC--Not technical services but transportation--Fall within purview of special provisions--But under DTAA notional income restricted to 7.5 per cent. of receipts and tax limited to 50 per cent. of tax imposed by India--No deduction for service tax-- Siem Offshore Inc ., In re (AAR) . . . 207
Double Taxation Avoidance Agreement between India and the U.S.A. :
Art. 12(4)(b) --Non-resident--Taxability in India--Deduction of tax at source--Employees of non-resident company deputed to Indian subsidiary for performing managerial functions--Salary and benefits paid to expatriate employees by non-resident employer and reimbursed by Indian company--Are fees for included services accruing to non-resident company--Requirement of "making available" technical know-how not applicable--Tax deductible at source-- Verizon Data Services India Private Ltd ., In re (AAR) . . . 192
S. 68 --Non-resident--Prospecting for or extraction of mineral oils--Services in connection therewith--Special provisions for computation of income--Tax resident of Norway providing sea logistics services for ONGC--Not technical services but transportation--Fall within purview of special provisions--But under DTAA notional income restricted to 7.5 per cent. of receipts and tax limited to 50 per cent. of tax imposed by India--No deduction for service tax-- Siem Offshore Inc ., In re (AAR) . . . 207
S. 9(1)(vii) --Non-resident--Prospecting for or extraction of mineral oils--Services in connection therewith--Special provisions for computation of income--Tax resident of Norway providing sea logistics services for ONGC--Not technical services but transportation--Fall within purview of special provisions--But under DTAA notional income restricted to 7.5 per cent. of receipts and tax limited to 50 per cent. of tax imposed by India--No deduction for service tax-- Siem Offshore Inc ., In re(AAR) . . . 207
S. 9(1)(vii), Expln. 2 --Non-resident--Taxability in India--Deduction of tax at source--Employees of non-resident company deputed to Indian subsidiary for performing managerial functions--Salary and benefits paid to expatriate employees by non-resident employer and reimbursed by Indian company--Are fees for included services accruing to non-resident company--Requirement of "making available" technical know-how not applicable--Tax deductible at source-- Verizon Data Services India Private Ltd ., In re (AAR) . . . 192
S. 28(va) --Capital gains or business income--Consideration received on transfer of rights of trade mark, brands, copyrights in journals and publications--Business given up distinct from business continued--Consideration not arising out of business but is long-term capital gains--Section 28(va) does not apply-- CIT v. Mediworld Publications Pvt. Ltd. (Delhi) . . . 178
S. 44BB --Non-resident--Prospecting for or extraction of mineral oils--Services in connection therewith--Special provisions for computation of income--Tax resident of Norway providing sea logistics services for ONGC--Not technical services but transportation--Fall within purview of special provisions--But under DTAA notional income restricted to 7.5 per cent. of receipts and tax limited to 50 per cent. of tax imposed by India--No deduction for service tax-- Siem Offshore Inc ., In re(AAR) . . . 207
----Non-resident--Rate of tax--Prospecting for, or extraction or production of, mineral oils--Service of conducting seismic surveys and providing onshore seismic data acquisition and other associated services--Taxable under special provision--Entire receipts subject to deeming provision--Income cannot be split-- Bergen Oilfield Services AS, Norway , In re (AAR) . . . 167
S. 132(4) --Search and seizure--Block assessment--Undisclosed income--Statement under section 132(4)--Admissibility--Addition based on confessional statement made by assessee and counter-signature by his sons--Failure by assessee to prove that confession was as a result of intimidation, duress and coercion--No evidence that confession made as a result of mistaken belief of law or facts--Addition justified-- Asst. CIT v. Hukum Chand Jain (Chhattisgarh) . . . 238
S. 145 --Income from other sources--Compulsory acquisition of agricultural land--Enhanced compensation--Interest on delayed payment--Claim to spread over on accrual basis but interest for two years alone disclosed--Inference of cash system of accounting--Interest taxable in year of receipt-- CIT v. Karambir Singh (P&H) . . . 159
S. 147 --Reassessment--Notice after four years--No failure to disclose material facts necessary for assessment--Deduction allowed in original assessment after considering facts--Reassessment proceedings after four years to disallow deduction on ground it was capital expenditure--Not valid-- Parle Sales and Services P. Ltd. v. ITO (Guj) . . . 203
S. 148 --Reassessment--Notice after four years--No failure to disclose material facts necessary for assessment--Deduction allowed in original assessment after considering facts--Reassessment proceedings after four years to disallow deduction on ground it was capital expenditure--Not valid-- Parle Sales and Services P. Ltd. v. ITO (Guj) . . . 203
S. 158B --Search and seizure--Block assessment--Assessment of third person--Condition precedent--Satisfaction of Assessing Officer of person searched that undisclosed income discovered during search belonged to third person--Meaning of satisfaction--Letter by Assessing Officer of person searched that assessee acted as mediator in bogus accommodation transactions--No evidence that assessee had given cash to person searched or had received commission--Condition not fulfilled--Block assessment of assessee--Not valid-- CIT v. Radhey Shyam Bansal (Delhi) . . . 217
S. 158BD --Search and seizure--Block assessment--Assessment of third person--Condition precedent--Satisfaction of Assessing Officer of person searched that undisclosed income discovered during search belonged to third person--Meaning of satisfaction--Letter by Assessing Officer of person searched that assessee acted as mediator in bogus accommodation transactions--No evidence that assessee had given cash to person searched or had received commission--Condition not fulfilled--Block assessment of assessee--Not valid-- CIT v. Radhey Shyam Bansal (Delhi) . . . 217
----Search and seizure--Block assessment--Undisclosed income--Addition permissible only in respect of material discovered during search--Estimate of expenditure on house by Valuation Officer--No material recovered in search showing expenditure beyond that recorded in books--Addition solely on basis of estimate--Not valid-- CIT v. Kantilal B. Kansara (HUF) (Guj) . . . 187
S. 195 --Non-resident--Taxability in India--Deduction of tax at source--Employees of non-resident company deputed to Indian subsidiary for performing managerial functions--Salary and benefits paid to expatriate employees by non-resident employer and reimbursed by Indian company--Are fees for included services accruing to non-resident company--Requirement of "making available" technical know-how not applicable--Tax deductible at source-- Verizon Data Services India Private Ltd ., In re (AAR) . . . 192
S. 271(1)(c), Expln. 5 --Penalty--Concealment of income--Search and seizure--Assessee making disclosure statement under section 132(4)--Time for filing return not expired--Income included in return and tax paid--Not a case of concealment of particulars of income--Penalty cannot be imposed-- CIT v. Bhandari Silk Store (P&H) . . . 153
S. 276B --Offences and prosecution--Compounding of offences--Guidelines issued by CBDT--Compounding permissible for technical offences--Compounding not possible after filing of complaint-- Anil Batra v. Chief CIT (Delhi) . . . 251
S. 34 --Income from other sources--Compulsory acquisition of agricultural land--Enhanced compensation--Interest on delayed payment--Claim to spread over on accrual basis but interest for two years alone disclosed--Inference of cash system of accounting--Interest taxable in year of receipt-- CIT v. Karambir Singh (P&H) . . . 159
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