INCOME TAX REPORTS (ITR)
Volume 342 : Part 5 (Issue dated 16-4-2012)
SUBJECT INDEX TO CASES REPORTED IN THIS PART
Appeal to Appellate Tribunal --Cash credits--Sale of jewellery--Assessing Officer and Commissioner (Appeals) holding transactions of sale to be fictitious--Tribunal not right in setting aside finding without considering evidence--Income-tax Act, 1961, s. 68-- CIT v. Tejinder Singh HUF (P&H) . . . 295
Bad debt --Share broker purchasing shares for his clients--Brokerage credited to profit and loss account--Brokerage receivable from treated as bad debt--Part of debt to be taken into account while computing income--Allowable--Income-tax Act, 1961, s. 36(1)(vii), (2)(i)-- CIT v. Shreyas S. Morakhia (Bom) . . . 285
Business expenditure --Deduction only on actual payment--Excise duty on inputs used in manufacture of goods--Matter remanded to allow opportunity to assessee to produce proof of payment--Income-tax Act, 1961, s. 43B-- CIT v. H. P. Global Soft Ltd. (No. 2 ) (Karn) . . . 276
Capital gains --Exemption--Law applicable--Effect of section 54EA inserted w. e. f. 1-10-1996 and included in ambit of section 54H w. e. f. 1-4-1999--Compulsory acquisition of land in 1992--Enhancement of compensation in 1997--Investment of amount in UTI--Assessee entitled to exemption under section 54EA--Income-tax Act, 1961, ss. 45, 54EA, 54H-- CIT v. J. Palemar Krishna (Karn) . . . 366
Exemption --Export of computer software--No material to show assessee indulged in arrangement with foreign buyer so as to produce higher profits to assessee--Assessing Officer not entitled to presume such arrangement and determine reasonable profits--Income-tax Act, 1961, ss. 10A(6), 80-I(9)-- CIT v. H. P. Global Soft Ltd. (No. 1 ) (Karn) . . . 263
Interpretation of taxing statutes --Interpretation extending benefit intended by Legislature-- CIT v. J. Palemar Krishna (Karn) . . . 366
Method of accounting --Business expenditure--Deduction only on actual payment--Valuation of stock--Unutilised Modvat credit--Deduction of excise duty paid on inputs used in manufacture--Not a question of method of accounting--Assessee to be given opportunity to prove payment of excise duty on inputs--Income-tax Act, 1961, ss. 43B, 145-- CIT v. H. P. Global Soft Ltd. (No. 1 ) (Karn) . . . 263
Non-resident --Agent of non-resident--Assessment proceedings simultaneously against non-resident and his agent--Valid --Income-tax Act, 1961, s. 166-- Aditya Birla Nuvo Ltd . v. Deputy Director of Income-tax (International Taxation) (Bom) . . . 308
Obsolescence --Customs duty on goods claimed irrecoverable--Matter remanded--Customs duty on computer software--Deduction allowable-- CIT v. H. P. Global Soft Ltd. (No. 2 ) (Karn) . . . 276
Penalty --Concealment of income--Disallowance of payment to Registrar of Companies and payments on which tax deducted at source paid to Government after end of previous year--Assessee can raise contention in penalty proceedings that explanation plausible--Cancellation of penalty justified--Income-tax Act, 1961, s. 271(1)(c)-- CIT v. AT & T Communication Services India P. Ltd. (Delhi) . . . 257
Reassessment --Capital gains--Joint venture by non-resident and an Indian company--Agreement specifying rights of promoters--Transfer of shares from one non-resi-dent to other--Transfer included transfer of rights--Prima facie belief that capital gains arose--Justified--Reassessment proceedings--Valid--Income-tax Act, 1961-- Aditya Birla Nuvo Ltd . v. Deputy Director of Income-tax (International Taxation) (Bom) . . . 308
Recovery of tax --Interest--Waiver of interest--Law applicable--Effect of amendment of section 220(2A) in 1984--Power to waive should be exercised judiciously--Finding that all conditions for waiver were satisfied--Waiver of part of interest--Not valid--Income-tax Act, 1961, s. 220(2A)--E . M. Joseph v. Chief CIT (Ker) . . . 379
SECTIONWISE INDEX TO CASES REPORTED IN THIS PART
S. 10A(6) --Exemption--Export of computer software--No material to show assessee indulged in arrangement with foreign buyer so as to produce higher profits to assessee--Assessing Officer not entitled to presume such arrangement and determine reasonable profits-- CIT v. H. P. Global Soft Ltd. (No. 1 ) (Karn) . . . 263
S. 36(1)(vii) --Bad debt--Share broker purchasing shares for his clients--Brokerage credited to profit and loss account--Brokerage receivable from treated as bad debt--Part of debt to be taken into account while computing income--Allowable-- CIT v. Shreyas S. Morakhia (Bom) . . . 285
S. 36(2)(i) --Bad debt--Share broker purchasing shares for his clients--Brokerage credited to profit and loss account--Brokerage receivable from treated as bad debt--Part of debt to be taken into account while computing income--Allowable-- CIT v. Shreyas S. Morakhia (Bom) . . . 285
S. 43B --Business expenditure--Deduction only on actual payment--Excise duty on inputs used in manufacture of goods--Matter remanded to allow opportunity to assessee to produce proof of payment-- CIT v. H. P. Global Soft Ltd. (No. 2 ) (Karn) . . . 276
----Method of accounting--Business expenditure--Deduction only on actual payment--Valuation of stock--Unutilised Modvat credit--Deduction of excise duty paid on inputs used in manufacture--Not a question of method of accounting--Assessee to be given opportunity to prove payment of excise duty on inputs-- CIT v. H. P. Global Soft Ltd. (No. 1 ) (Karn) . . . 263
S. 45 --Capital gains--Exemption--Law applicable--Effect of section 54EA inserted w. e. f. 1-10-1996 and included in ambit of section 54H w. e. f. 1-4-1999--Compulsory acquisition of land in 1992--Enhancement of compensation in 1997--Investment of amount in UTI--Assessee entitled to exemption under section 54EA-- CIT v. J. Palemar Krishna (Karn) . . . 366
S. 54EA --Capital gains--Exemption--Law applicable--Effect of section 54EA inserted w. e. f. 1-10-1996 and included in ambit of section 54H w. e. f. 1-4-1999--Compulsory acquisition of land in 1992--Enhancement of compensation in 1997--Investment of amount in UTI--Assessee entitled to exemption under section 54EA-- CIT v. J. Palemar Krishna (Karn) . . . 366
S. 54H --Capital gains--Exemption--Law applicable--Effect of section 54EA inserted w. e. f. 1-10-1996 and included in ambit of section 54H w. e. f. 1-4-1999--Compulsory acquisition of land in 1992--Enhancement of compensation in 1997--Investment of amount in UTI--Assessee entitled to exemption under section 54EA-- CIT v. J. Palemar Krishna (Karn) . . . 366
S. 68 --Appeal to Appellate Tribunal--Cash credits--Sale of jewellery--Assessing Officer and Commissioner (Appeals) holding transactions of sale to be fictitious--Tribunal not right in setting aside finding without considering evidence-- CIT v. Tejinder Singh HUF (P&H) . . . 295
S. 80-I(9) --Exemption--Export of computer software--No material to show assessee indulged in arrangement with foreign buyer so as to produce higher profits to assessee--Assessing Officer not entitled to presume such arrangement and determine reasonable profits-- CIT v. H. P. Global Soft Ltd. (No. 1 ) (Karn) . . . 263
S. 145 --Method of accounting--Business expenditure--Deduction only on actual payment--Valuation of stock--Unutilised Modvat credit--Deduction of excise duty paid on inputs used in manufacture--Not a question of method of accounting--Assessee to be given opportunity to prove payment of excise duty on inputs-- CIT v. H. P. Global Soft Ltd. (No. 1 ) (Karn) . . . 263
S. 166 --Non-resident--Agent of non-resident--Assessment proceedings simultaneously against non-resident and his agent--Valid -- Aditya Birla Nuvo Ltd . v. Deputy Director of Income-tax (International Taxation) (Bom) . . . 308
S. 220(2A) --Recovery of tax--Interest--Waiver of interest--Law applicable--Effect of amendment of section 220(2A) in 1984--Power to waive should be exercised judiciously--Finding that all conditions for waiver were satisfied--Waiver of part of interest--Not valid--E . M. Joseph v. Chief CIT (Ker) . . . 379
S. 271(1)(c) --Penalty--Concealment of income--Disallowance of payment to Registrar of Companies and payments on which tax deducted at source paid to Government after end of previous year--Assessee can raise contention in penalty proceedings that explanation plausible--Cancellation of penalty justified-- CIT v. AT & T Communication Services India P. Ltd. (Delhi) . . . 257
ITR'S TRIBUNAL TAX REPORTS (ITR (TRIB))
Volume 15 : Part 2 (Issue dated : 16-4-2012)
SUBJECT INDEX TO CASES REPORTED IN THIS PART
Book profit --Provision for bad and doubtful debts and doubtful advances--Matter remanded--Income-tax Act, 1961, s. 115JB-- Asst. CIT v. Essar Steel Ltd. , Visakhapatnam (Visakhapatnam) . . . 189
Business expenditure --Disallowance--Protective addition on BSE card--To be deleted--Income-tax Act, 1961-- Sino Securities P. Ltd. v. ITO (Mumbai) . . . 137
Deduction of tax at source --Business of share broking--Transaction charges paid to stock exchange--Fees for technical services--Tax to be deducted--Income-tax Act, 1961, s. 194J-- Sino Securities P. Ltd. v. ITO (Mumbai) . . . 137
Depreciation --Membership card of Bombay Stock Exchange--Corporatisation and demutualisation of stock exchange--Effect--Business and commercial rights held by assessee as holder of membership card no longer exist--Not entitled to depreciation--Income-tax Act, 1961, s. 32(1)(b)-- Sino Securities P. Ltd. v. ITO (Mumbai) . . . 137
Exemption --Dividend--No expenditure incurred in earning dividend income--Rule 8D cannot be applied--Matter remanded for disallowance of reasonable sum--Income-tax Act, 1961, s. 14A-- Sino Securities P. Ltd. v. ITO (Mumbai) . . . 137
Export --Exemption--Total turnover--Computation--Charges reduced from export turnover--To be also reduced from total turnover--Income-tax Act, 1961, s. 10A-- ADP P. Ltd. v. Deputy CIT (Hyderabad) . . . 203
International transaction --Arm's length price--Comparables--Dispute Resolution Panel not accepted that loss making company required to be included as comparable--Assessing Officer to comply with direction of Dispute Resolution Panel-- Tecnimount ICB P. Ltd. v. Asst. CIT (Mumbai) . . . 216
----Arm's length price--Reference to Transfer Pricing Officer--Addition on account of difference in average net operating margin--Assessee using imported technology and imported raw material for international and non-international transactions--Best comparable would be of transactions of tested party--Profit level indicator worked out by assessee higher than Transfer Pricing Officer--No need for any adjustment--Income-tax Act, 1961, s. 92CA-- Abhishek Auto Industries Ltd. v. Dy. CIT (Delhi) . . . 168
----Computation of arm's length price--Assessee relying on Circular No. 12, dated 23-8-2001--Circular becoming otiose by virtue of amendment to Act--Only one price determined--Assessee not entitled to concession under proviso to section 92C(2)--Income-tax Act, 1961, s. 92C(2)--Circular No. 12, dated 23-8-2001-- Asst. CIT v. Essar Steel Ltd. , Visakhapatnam (Visakhapatnam) . . . 189
----Determination of arm's length price--Only one out of several methods specified under proviso to section 92C(2) applied--Assessee not entitled to deduction of 5 per cent. adjustment from arm's length price--Income-tax Act, 1961, s. 92C(2)--Circular No. 12, dated August 23, 2001-- ADP P. Ltd. v. Deputy CIT (Hyderabad) . . . 203
----Transfer pricing--Arm's length price--Comparables--Reference to Transfer Pricing Officer--Finding that operating profit/sales of assessee higher than industry margin--Transactions between assessee and its associated enterprises were at arm's length--Income-tax Act, 1961, s. 92C-- Deputy CIT v. Indo-American Jewellery Ltd. (Mumbai) . . . 158
----Transfer pricing--Determination of arm's length price--Adjustment contemplated in proviso to be made at option of assessee--Income-tax Act, 1961, s. 92C-- Tecnimount ICB P. Ltd. v. Asst. CIT (Mumbai) . . . 216
Transfer pricing --Determination of arm's length price--Selection of comparables--Data of subsequent period cannot be considered for comparison--Income-tax Act, 1961, s. 92C--Income-tax Rules, 1962, r. 10B(4)-- ADP P. Ltd. v. Deputy CIT (Hyderabad) . . . 203
----International transactions--Determination of arms' length price--Dispute Resolution Panel--Transfer Pricing Officer rejecting segmental results on ground that not audited--Assessee duly auditing and filing before Dispute Resolution Panel as additional evidence--Rejection as not filed before Transfer Pricing Officer--Not proper--Matter remanded --Income-tax Act, 1961, ss. 92C, 144C--Income-tax (Disputes Resolution Panel) Rules, 2009, r. 4-- Tecnimount ICB P. Ltd. v. Asst. CIT (Mumbai) . . . 216
SECTIONWISE INDEX TO CASES REPORTED IN THIS PART
S. 10A --Export--Exemption--Total turnover--Computation--Charges reduced from export turnover--To be also reduced from total turnover-- ADP P. Ltd. v. Deputy CIT (Hyderabad) . . . 203
S. 14A --Exemption--Dividend--No expenditure incurred in earning dividend income--Rule 8D cannot be applied--Matter remanded for disallowance of reasonable sum-- Sino Securities P. Ltd. v. ITO (Mumbai) . . . 137
S. 32(1)(b) --Depreciation--Membership card of Bombay Stock Exchange--Corporatisation and demutualisation of stock exchange--Effect--Business and commercial rights held by assessee as holder of membership card no longer exist--Not entitled to depreciation-- Sino Securities P. Ltd. v. ITO (Mumbai) . . . 137
S. 92C --International transactions--Transfer pricing--Arm's length price--Comparables--Reference to Transfer Pricing Officer--Finding that operating profit/sales of assessee higher than industry margin--Transactions between assessee and its associated enterprises were at arm's length-- Deputy CIT v. Indo-American Jewellery Ltd. (Mumbai) . . . 158
----International transactions--Transfer pricing--Determination of arm's length price--Adjustment contemplated in proviso to be made at option of assessee-- Tecnimount ICB P. Ltd. v. Asst. CIT (Mumbai) . . . 216
----Transfer pricing--Determination of arm's length price--Selection of comparables--Data of subsequent period cannot be considered for comparison-- ADP P. Ltd. v. Deputy CIT (Hyderabad) . . . 203
----Transfer pricing--International transactions--Determination of arms' length price--Dispute Resolution Panel--Transfer Pricing Officer rejecting segmental results on ground that not audited--Assessee duly auditing and filing before Dispute Resolution Panel as additional evidence--Rejection as not filed before Transfer Pricing Officer--Not proper--Matter remanded-- Tecnimount ICB P. Ltd. v. Asst. CIT (Mumbai) . . . 216
S. 92C(2) --International transaction--Computation of arm's length price--Assessee relying on Circular No. 12, dated 23-8-2001--Circular becoming otiose by virtue of amendment to Act--Only one price determined--Assessee not entitled to concession under proviso to section 92C(2)--Circular No. 12, dated 23-8-2001-- Asst. CIT v. Essar Steel Ltd., Visakhapatnam (Visakhapatnam) . . . 189
----International transaction--Determination of arm's length price--Only one out of several methods specified under proviso to section 92C(2) applied--Assessee not entitled to deduction of 5 per cent. adjustment from arm's length price--Circular No. 12, dated August 23, 2001-- ADP P. Ltd. v. Deputy CIT (Hyderabad) . . . 203
S. 92CA --International transactions--Arm's length price--Reference to Transfer Pricing Officer--Addition on account of difference in average net operating margin--Assessee using imported technology and imported raw material for international and non-international transactions--Best comparable would be of transactions of tested party--Profit level indicator worked out by assessee higher than Transfer Pricing Officer--No need for any adjustment-- Abhishek Auto Industries Ltd. v. Deputy CIT (Delhi) . . . 168
S. 115JB --Book profit--Provision for bad and doubtful debts and doubtful advances--Matter remanded-- Asst. CIT v. Essar Steel Ltd., Visakhapatnam (Visakhapatnam) . . . 189
S. 144C --Transfer pricing--International transactions--Determination of arms' length price--Dispute Resolution Panel--Transfer Pricing Officer rejecting segmental results on ground that not audited--Assessee duly auditing and filing before Dispute Resolution Panel as additional evidence--Rejection as not filed before Transfer Pricing Officer--Not proper--Matter remanded-- Tecnimount ICB P. Ltd. v. Asst. CIT (Mumbai) . . . 216
S. 194J --Deduction of tax at source--Business of share broking--Transaction charges paid to stock exchange--Fees for technical services--Tax to be deducted-- Sino Securities P. Ltd. v. ITO (Mumbai) . . . 137
Income-tax (Disputes Resolution Panel) Rules, 2009 :
R. 4-- Transfer pricing--International transactions--Determination of arms' length price--Dispute Resolution Panel--Transfer Pricing Officer rejecting segmental results on ground that not audited--Assessee duly auditing and filing before Dispute Resolution Panel as additional evidence--Rejection as not filed before Transfer Pricing Officer--Not proper--Matter remanded-- Tecnimount ICB P. Ltd. v. Asst. CIT (Mumbai) . . . 216
R. 10B(4) --Transfer pricing--Determination of arm's length price--Selection of comparables--Data of subsequent period cannot be considered for comparison-- ADP P. Ltd. v. Deputy CIT (Hyderabad) . . . 203
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