INCOME TAX REPORTS (ITR)
Volume 338 : Part 4 (Issue dated 7-11-2011)
SUBJECT INDEX TO CASES REPORTED IN THIS PART
Advance tax --Interest--Company--Book profits--Interest under sections 234B and 234C to be paid on failure to pay advance tax in respect of tax payable under section 115JA/115JB--Income-tax Act, 1961, ss. 115JA, 115JB, 234B, 234C-- CIT v. Steel Steips Leasing Ltd. (P&H) . . . 455
Bad debts --Non-banking financial company--Amount advanced in ordinary course of business--To be allowed--Income-tax Act, 1961, s. 36(1)(vii), (2)-- All Grow Finance and Investment P. Ltd. v. CIT (Delhi) . . . 496
Business expenditure --Interest on borrowed capital--Assessee investing borrowed funds in equity capital of subsidiary company--Expenditure incurred for business purposes--To be allowed--Income-tax Act, 1961, s. 36(1)(iii)-- CIT v. Tulip Star Hotels Ltd . (Delhi) . . . 482
Export --Special deduction--Export--Meaning of--Supply of food and beverages to foreign airlines leaving India--Articles escorted by Customs Officer--RBI certifying that amount received deemed to be convertible foreign exchange--Assessee entitled to special deduction under section 80HHC--Income-tax Act, 1961, s. 80HHC-- EIH Ltd . v. CIT (Cal) . . . 503
Income from other sources --Business income--Income from letting out factory--No proof that assessee only let it out temporarily and intended to resume its business--Income to be treated as income from other sources--Income-tax Act, 1961-- CIT v. Venkateswara Agro Chemicals and Minerals P. Ltd. (Mad) . . . 428
Income-tax --General principles--Decision regarding fundamental nature of transactions continuing for a number of years--Change in view for a particular year without adequate reason--Not justified-- CIT v. Escorts Ltd . (Delhi) . . . 435
Refund --Interest on refund--Date from which interest becomes due--Effect of section 244A and Circular No. 549, dated 31-10-1989--Excess amount paid on self-assessment--Excess to be refunded with interest from date of payment of such tax till date of refund--Income-tax Act, 1961, s. 244A--Circular No. 549, dated 31-10-1989-- CIT v. Vijaya Bank (Karn) . . . 489
Revision --Transactions of purchase and sale of units for many years--Transactions considered to be genuine in prior and subsequent assessment years--Revision proceedings on ground that transactions pertaining to relevant assessment year were speculative--Not permissible--Income-tax Act, 1961, s. 263-- CIT v. Escorts Ltd .(Delhi) . . . 435
Search and seizure --Block assessment--Undisclosed income--Effect of Remittances of Foreign Exchange and Investment in Foreign Exchange Bonds (Immunities and Exemptions) Act, 1991--Bonds entitled to immunity from enquiry--Receipt of bonds as gifts--Value of bonds not assessable as undisclosed income--Income-tax Act, 1961, s. 158BC--Remittances of Foreign Exchange and Investment in Foreign Exchange Bonds (Immunities and Exemptions) Act, 1991-- CIT v. Smt. Usha Omer (All) . . . 448
----Validity--Condition precedent for search--Information giving rise to belief that income would not be disclosed--Inquiries and material showing documents would not be produced--Search valid--Notice under sections 131(1A) and 133(6) subsequent to search would not invalidate search--Allegation that search proceedings were mala fide--Burden of proof on assessee to prove allegation--Income-tax Act, 1961, ss. 131, 132, 133-- Neesa Leisure Ltd . v. Union of India through Secretary (Guj) . . . 460
Unexplained investment --Investment in properties--No evidence of understatement of consideration--Addition to income based solely on report of District Valuation Officer--Not valid--Income-tax Act, 1961, s. 69B-- CIT v. Puneet Sabharwal (Delhi) . . . 485
SECTIONWISE INDEX TO CASES REPORTED IN THIS PART
S. 36(1)(iii) --Business expenditure--Interest on borrowed capital--Assessee investing borrowed funds in equity capital of subsidiary company--Expenditure incurred for business purposes--To be allowed-- CIT v. Tulip Star Hotels Ltd .(Delhi) . . . 482
S. 36(1)(vii) --Bad debts--Non-banking financial company--Amount advanced in ordinary course of business--To be allowed-- All Grow Finance and Investment P. Ltd. v. CIT (Delhi) . . . 496
S. 36(2) --Bad debts--Non-banking financial company--Amount advanced in ordinary course of business--To be allowed-- All Grow Finance and Investment P. Ltd. v. CIT (Delhi) . . . 496
S. 69B --Unexplained investment--Investment in properties--No evidence of understatement of consideration--Addition to income based solely on report of District Valuation Officer--Not valid-- CIT v. Puneet Sabharwal (Delhi) . . . 485
S. 80HHC --Export--Special deduction--Export--Meaning of--Supply of food and beverages to foreign airlines leaving India--Articles escorted by Customs Officer--RBI certifying that amount received deemed to be convertible foreign exchange--Assessee entitled to special deduction under section 80HHC-- EIH Ltd . v. CIT (Cal) . . . 503
S. 115JA --Advance tax--Interest--Company--Book profits--Interest under sections 234B and 234C to be paid on failure to pay advance tax in respect of tax payable under section 115JA/115JB-- CIT v. Steel Steips Leasing Ltd. (P&H) . . . 455
S. 115JB --Advance tax--Interest--Company--Book profits--Interest under sections 234B and 234C to be paid on failure to pay advance tax in respect of tax payable under section 115JA/115JB-- CIT v. Steel Steips Leasing Ltd. (P&H) . . . 455
S. 131 --Search and seizure--Validity--Condition precedent for search--Information giving rise to belief that income would not be disclosed--Inquiries and material showing documents would not be produced--Search valid--Notice under sections 131(1A) and 133(6) subsequent to search would not invalidate search--Allegation that search proceedings were mala fide--Burden of proof on assessee to prove allegation-- Neesa Leisure Ltd . v. Union of India through Secretary (Guj) . . . 460
S. 132 --Search and seizure--Validity--Condition precedent for search--Information giving rise to belief that income would not be disclosed--Inquiries and material showing documents would not be produced--Search valid--Notice under sections 131(1A) and 133(6) subsequent to search would not invalidate search--Allegation that search proceedings were mala fide--Burden of proof on assessee to prove allegation-- Neesa Leisure Ltd . v. Union of India through Secretary (Guj) . . . 460
S. 133 --Search and seizure--Validity--Condition precedent for search--Information giving rise to belief that income would not be disclosed--Inquiries and material showing documents would not be produced--Search valid--Notice under sections 131(1A) and 133(6) subsequent to search would not invalidate search--Allegation that search proceedings were mala fide--Burden of proof on assessee to prove allegation-- Neesa Leisure Ltd . v. Union of India through Secretary (Guj) . . . 460
S. 158BC --Search and seizure--Block assessment--Undisclosed income--Effect of Remittances of Foreign Exchange and Investment in Foreign Exchange Bonds (Immunities and Exemptions) Act, 1991--Bonds entitled to immunity from enquiry--Receipt of bonds as gifts--Value of bonds not assessable as undisclosed income--Remittances of Foreign Exchange and Investment in Foreign Exchange Bonds (Immunities and Exemptions) Act, 1991-- CIT v. Smt. Usha Omer (All) . . . 448
S. 234B --Advance tax--Interest--Company--Book profits--Interest under sections 234B and 234C to be paid on failure to pay advance tax in respect of tax payable under section 115JA/115JB-- CIT v. Steel Steips Leasing Ltd. (P&H) . . . 455
S. 234C --Advance tax--Interest--Company--Book profits--Interest under sections 234B and 234C to be paid on failure to pay advance tax in respect of tax payable under section 115JA/115JB-- CIT v. Steel Steips Leasing Ltd. (P&H) . . . 455
S. 244A --Refund--Interest on refund--Date from which interest becomes due--Effect of section 244A and Circular No. 549, dated 31-10-1989--Excess amount paid on self-assessment--Excess to be refunded with interest from date of payment of such tax till date of refund--Circular No. 549, dated 31-10-1989-- CIT v. Vijaya Bank (Karn) . . . 489
S. 263 --Revision--Transactions of purchase and sale of units for many years--Transactions considered to be genuine in prior and subsequent assessment years--Revision proceedings on ground that transactions pertaining to relevant assessment year were speculative--Not permissible-- CIT v. Escorts Ltd . (Delhi) . . . 435
ITR'S TRIBUNAL TAX REPORTS (ITR (TRIB))
Volume 12 : Part 2 (Issue dated : 7-11-2011)
SUBJECT INDEX TO CASES REPORTED IN THIS PART
Business expenditure --Obsolete materials written off--Valuation of cassettes at Re. 1 after some time--Proper--Loss allowable--Income-tax Act, 1961-- Bennett Coleman and Co. Ltd. v. Addl. CIT [SB] (Mumbai) . . . 97
Capital gains --Loss--Assessee holding shares in company--Value of shares reduced as result of reduction of share capital of company--No transfer involved--No consideration flowing from company--Provisions of section 45 not applicable--No loss to shareholder--Notional loss not allowable--Income-tax Act, 1961, ss. 2(47), 45, 55(2)(b)(v)-- Bennett Coleman and Co. Ltd. v. Addl. CIT [SB] (Mumbai) . . . 97
Industrial undertaking --Special deduction--Publishing of newspaper--Is industrial activity--Special deduction allowable--Income-tax Act, 1961, s. 80-IB-- Bennett Coleman and Co. Ltd. v. Addl. CIT [SB] (Mumbai) . . . 97
Revision --Conditions precedent--General principles--Non-resident--Opting to be taxed in terms of DTAA--Deduction of expenses to be allowed--Assessing Officer after verification of TDS returns allowing deductions for payments to contractors outside India and applying 10 per cent. tax rate to balance--Assessee taxed similarly for preceding years--Revision proposed without showing how facts different in current year--Not a case where Assessing Officer did not apply mind or made no enquiry--Order not erroneous or prejudicial to Revenue--No material to show nexus of permanent establishment with income from operations outside India--Revision not permissible--Income-tax Act, 1961, ss. 44BB, 90, 263--Double Taxation Avoidance Agreement between India and Korea, art. 7-- Hyundai Heavy Industries Co. Ltd. v. Director of Income-tax (International Taxation) (Delhi) . . . 168
SECTIONWISE INDEX TO CASES REPORTED IN THIS PART
Double Taxation Avoidance Agreement between India and Korea :
Art. 7 -- Revision--Conditions precedent--General principles--Non-resident--Opting to be taxed in terms of DTAA--Deduction of expenses to be allowed--Assessing Officer after verification of TDS returns allowing deductions for payments to contractors outside India and applying 10 per cent. tax rate to balance--Assessee taxed similarly for preceding years--Revision proposed without showing how facts different in current year--Not a case where Assessing Officer did not apply mind or made no enquiry--Order not erroneous or prejudicial to Revenue--No material to show nexus of permanent establishment with income from operations outside India--Revision not permissible-- Hyundai Heavy Industries Co. Ltd. v. Director of Income-tax (International Taxation) (Delhi) . . . 168
S. 2(47) -- Capital gains--Loss--Assessee holding shares in company--Value of shares reduced as result of reduction of share capital of company--No transfer involved--No consideration flowing from company--Provisions of section 45 not applicable--No loss to shareholder--Notional loss not allowable-- Bennett Coleman and Co. Ltd. v. Addl. CIT [SB] (Mumbai) . . . 97
S. 44BB -- Revision--Conditions precedent--General principles--Non-resident--Opting to be taxed in terms of DTAA--Deduction of expenses to be allowed--Assessing Officer after verification of TDS returns allowing deductions for payments to contractors outside India and applying 10 per cent. tax rate to balance--Assessee taxed similarly for preceding years--Revision proposed without showing how facts different in current year--Not a case where Assessing Officer did not apply mind or made no enquiry--Order not erroneous or prejudicial to Revenue--No material to show nexus of permanent establishment with income from operations outside India--Revision not permissible -- Hyundai Heavy Industries Co. Ltd. v. Director of Income-tax (International Taxation) (Delhi) . . . 168
S. 45 -- Capital gains--Loss--Assessee holding shares in company--Value of shares reduced as result of reduction of share capital of company--No transfer involved--No consideration flowing from company--Provisions of section 45 not applicable--No loss to shareholder--Notional loss not allowable-- Bennett Coleman and Co. Ltd. v. Addl. CIT [SB] (Mumbai) . . . 97
S. 55(2)(b)(v) -- Capital gains--Loss--Assessee holding shares in company--Value of shares reduced as result of reduction of share capital of company--No transfer involved--No consideration flowing from company--Provisions of section 45 not applicable--No loss to shareholder--Notional loss not allowable-- Bennett Coleman and Co. Ltd. v. Addl. CIT [SB] (Mumbai) . . . 97
S. 80-IB -- Industrial undertaking--Special deduction--Publishing of newspaper--Is industrial activity--Special deduction allowable-- Bennett Coleman and Co. Ltd. v. Addl. CIT [SB] (Mumbai) . . . 97
S. 90 -- Revision--Conditions precedent--General principles--Non-resident--Opting to be taxed in terms of DTAA--Deduction of expenses to be allowed--Assessing Officer after verification of TDS returns allowing deductions for payments to contractors outside India and applying 10 per cent. tax rate to balance--Assessee taxed similarly for preceding years--Revision proposed without showing how facts different in current year--Not a case where Assessing Officer did not apply mind or made no enquiry--Order not erroneous or prejudicial to Revenue--No material to show nexus of permanent establishment with income from operations outside India--Revision not permissible -- Hyundai Heavy Industries Co. Ltd. v. Director of Income-tax (International Taxation) (Delhi) . . . 168
S. 263 -- Revision--Conditions precedent--General principles--Non-resident--Opting to be taxed in terms of DTAA--Deduction of expenses to be allowed--Assessing Officer after verification of TDS returns allowing deductions for payments to contractors outside India and applying 10 per cent. tax rate to balance--Assessee taxed similarly for preceding years--Revision proposed without showing how facts different in current year--Not a case where Assessing Officer did not apply mind or made no enquiry--Order not erroneous or prejudicial to Revenue--No material to show nexus of permanent establishment with income from operations outside India--Revision not permissible -- Hyundai Heavy Industries Co. Ltd. v. Director of Income-tax (International Taxation) (Delhi) . . . 168
CA.RAJU SHAH
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