INCOME TAX REPORTS (ITR)--PRINT AND ONLINE EDITION
SUBJECT INDEX TO CASES REPORTED
Appeal to Commissioner (Appeals) --Transfer of case--Jurisdiction--Appeal transferred from one Commissioner (Appeals) to another Commissioner (Appeals) by Chief Commissioner--Commissioner (Appeals) has jurisdiction over appeal--Income-tax Act, 1961-- CIT v . Smt. Renuka Gowda (Karn) . . . 142
Business expenditure --Disallowance--Payments in cash exceeding prescribed limit--Route navigational and parking charges paid to Airports Authority of India--Authority requiring payment of cash before departure of a non-scheduled flight--Expenditure deductible under rule 6DD(b)--Income-tax Rules, 1962, r. 6DD(b)--Income-tax Act, 1961, s. 40A(3)-- CIT v . SRC Aviation Pvt. Ltd . (Delhi) . . . 129
Cash credits --Scope of section 68--Credits representing supplies to assessee--Finding that credits not genuine--Amount representing credits assessable under section 68--Income-tax Act, 1961, s. 68-- Smt. Rekha Krishnaraj v . ITO (Karn) . . . 113
Depreciation --Rate of depreciation--Higher rate of depreciation--Aircraft--Includes all manner of craft or means of transport aided by flight within Depreciation Rules--Does not confine scope of depreciation only to parts of such vehicles--Assessee entitled to higher depreciation at 40 per cent.--Revision--Commissioner cannot revise order of Assessing Officer that depreciation allowed not in accordance with law--Income-tax Rules, 1962, Appendix I, entry III(3)(i)--Income-tax Act, 1961, ss. 32, 263-- CIT v . SRC Aviation Pvt. Ltd. (Delhi) . . . 129
Income --Computation of income--Expenditure in relation to non-taxable income--Applicability of section 14A--Direction in Maxopp Investment Ltd. [2012] 347 ITR 272 (Delhi)--Assessing Officer shall take into consideration the direction--Matter remanded--Income-tax Act, 1961, s. 14A-- CIT v . SRC Aviation Pvt. Ltd .
(Delhi) . . . 129
Income from house property --Business income--Income of firm from letting out commercial property--Income from house property--Income-tax Act, 1961, ss. 22, 28-- Mahesh Investments v . Asst. CIT (Karn) . . . 144
Income from undisclosed sources --Assessee not owning any property but acting as a middle man--Surplus remaining with assessee over expenses alone to be taxed as income with assessee as undisclosed income--Not justified--Income-tax Act, 1961-- CIT v . Smt. Renuka Gowda (Karn) . . . 142
Interpretation of taxing statutes --Heading of section--Heading would not control words used-- Smt. Rekha Krishnaraj v . ITO (Karn) . . . 113
Search and seizure --Block assessment--Undisclosed income--Undisclosed income includes income below taxable limit--Income-tax Act, 1961, Chapter XIV-B-- Satpal Singh v. Asst. CIT (Investigation) (P&H) . . . 118
----Undisclosed income--Disclosure of additional business income--Addition by Assessing Officer embedded in additional disclosure at time of survey--Addition not justified--Income-tax Act, 1961-- CIT v . Akme Projects Ltd . (Delhi) . . . 125
Unexplained investment --Survey--Surrendered income during survey not recorded in books of account--Not forming part of business income--Deemed income--Assessable under section 69A--Income-tax Act, 1961, s. 69A-- KIM Pharma (P.) Ltd . v . CIT
(P&H) . . . 137
ITR Volume 355 : Part 2 (Issue dated : 15-7-2013)
SUBJECT INDEX TO CASES REPORTED IN THIS PART
Appeal to Appellate Tribunal --Block assessment--Tribunal finding it cannot go into legality and correctness of search and seizure operations because it was sub judice before High Court--Assessee withdrawing its writ petition--Tribunal can examine legality and propriety of search and seizure--Matter remanded--Income-tax Act, 1961-- Badri Ram Choudhary v . Asst. CIT (Raj) . . . 223
----Kar Vivad Samadhan Scheme--Scope of--Certificate determining tax arrears and payment by assessee of arrears--Immunity--Appeals relating to years covered under Scheme not maintainable--Finance (No. 2) Act, 1998--Income-tax Act, 1961-- CIT v. SPR Group Holdings (P.) Ltd . (Karn) . . . 169
Capital gains --Agricultural land--Capital asset--Definition--Land situate in State of Punjab within specified distance from municipality falling in State of Haryana--Urban land for purposes of definition of capital asset--Gains on sale of agricultural land assessable as capital gains--Income-tax Act, 1961, s. 2(14)(iii)(a)-- CIT v . Smt. Anjana Sehgal (P&H) . . . 294
Charitable purposes --Charitable trust--Registration of trust--Scope of section 12AA--Income-tax authorities to examine genuineness of trust--Application of income of trust not to be considered--Income-tax Act, 1961, ss. 10, 11, 12, 12AA-- CIT v. Surya Educational and Charitable Trust (P&H) . . . 280
Company --Reserves--Part of shareholders’ fund--Not a subsidy or grant or reimbursement by shareholders from which cost of assets met-- Bharat Sanchar Nigam Ltd . v . Dy. CIT (Delhi) . . . 188
Deduction of tax at source --Certificate for non-deduction--Income--Accrual of income--Arbitral award--Interest on sum deposited under interim order pending appeal against order of single judge on award--No absolute right to receive interest--Entitlement contingent on outcome of challenge to arbitral award--Denial of certificate of no deduction of tax at source--Not justified--Income-tax Act, 1961, s. 197-- DSL Enterprises P. Ltd. v . Mrs. N. C. Chandratre, Income-tax Officer, TDS -1
(Bom) . . . 209
----Payment to non-resident--Royalty--Meaning of--Web-based foreign publishing house--Assessee subscribing for data base--Payments to foreign publishing house constitute royalty--Tax deductible at source--Double Taxation Avoidance Agreement between India and the U. S. A., art. 12--Income-tax Act, 1961, ss. 9(1)(vi), 195, 201(1), (1A)-- CIT v . Wipro Ltd. (Karn) . . . 284
Depreciation --Actual cost--Subsidy--Government company formed to take over telecommunications business carried on by Government Department--Assets transferred at book value--Consideration paid in form of shares, debts and reserves--Book value of equity share consists of not only paid up capital but also reserves and surpluses--Reserves not a subsidy, grant or reimbursement for meeting cost of assets transferred--Reserves not to be reduced from fixed assets to arrive at actual cost--Income-tax Act, 1961, s. 43(1), Expln. 10-- Bharat Sanchar Nigam Ltd. v . Dy. CIT
(Delhi) . . . 188
Income --Accrual of income--Retention money--Amount retained to ensure satisfactory performance of contract--Amount retained does not accrue--Income-tax Act, 1961-- DIT (International taxation) v. Ballast Nedam International
(Guj) . . . 300
Income from undisclosed sources --Assessment--Assessee trading in finished fabrics--Whether purchases themselves bogus--Whether parties from whom such purchases were made bogus--Questions of fact--Tribunal finding assessee did purchase cloth and sell finished fabrics--Not entire purchase price but profit element embedded in purchases liable to tax--Income-tax Act, 1961-- CIT v . Bholanath Poly Fab Pvt. Ltd .
(Guj) . . . 290
Reassessment --Assessing Officer--Powers--Effect of Explanation 3 to section 147--Assessing Officer not making additions with respect to ground on basis of which notice issued--Cannot in a fresh assessment make additions on other issues which did not form part of reasons recorded--Income-tax Act, 1961, ss. 147, Expln. 3, 148-- CIT v . Mohmed Juned Dadani (Guj) . . . 172
----Not permissible on mere change of opinion--Wholly owned Government company formed to take over telecommunications business carried on by Government Department--Assets transferred at book value--Consideration paid in form of shares, debts and reserves--Assessment after calling for explanations as to capital structure--Reassessment to withdraw excess depreciation to extent cost of assets met by reserves--Mere change of opinion--Not permissible--Income-tax Act, 1961, ss. 143(3), 147, 148-- Bharat Sanchar Nigam Ltd. v . Dy. CIT (Delhi) . . . 188
Remission or cessation of liability --Condition that allowance or deduction ought to have been made in assessment for any year in respect of any loss, expenditure or trading liability incurred by assessee--No allowance or deduction made in assessment of assessee in any earlier year--Section 41(1) has no application--Income-tax Act, 1961, s. 41(1)-- CIT v . Shivali Construction Pvt. Ltd. (Delhi) . . . 218
Return of income --Failure to file--Interest--No material to show delay on part of Revenue in giving seized materials was reason for delay in filing return--No relief could be granted--Income-tax Act, 1961, s. 234A-- Sri Sivapriya Shelters Pvt. Ltd . v. Dy. CIT (Karn) . . . 221
Search and seizure --Assessment in search cases--Undisclosed income--Notice--Notice calling for true and correct return for assessment year 2008-09 in prescribed form--Assessee not complying with notice--Objections pending and no final order passed--Writ petition premature and not maintainable--Income-tax Act, 1961, s. 153A(a)-- J. R. Tantia Charitable Trust v . Dy. CIT (Raj) . . . 226
----Block assessment--Agricultural income--Assessee adopting son of his brother in whose name lands stood--Brother of assessee in charge of agricultural income--No evidence that brothers divided income equally--No addition could be made in hands of assessee--Income-tax Act, 1961, s. 158BC-- CIT v . Dr. K. P. Viswanath Prabhu
(Karn) . . . 163
----Block assessment--Medical practitioner--Undisclosed income on account of investments--Investments out of professional receipts recorded in diaries maintained by assessee found during search--Investments in diaries disclosed in regular returns--Protective assessment including such investments--Accrual of interest on investments--Not undisclosed income of assessee--Income-tax Act, 1961, s. 158BC-- CIT v . Dr. K. P. Viswanath Prabhu (Karn) . . . 163
----Block assessment--Undisclosed income--Addition on account of value of car, education expenses and stock of medicines--Tribunal finding all these acquired out of surplus amount and not acquired out of undisclosed income--No addition could be made to the declared undisclosed income--Income-tax Act, 1961, s. 158BC-- CIT v . Dr. K. P. Viswanath Prabhu (Karn) . . . 163
Transfer of cases --Discretion to be used for public purpose--Effective and co-ordinated investigation good ground for transfer of cases--Order of transfer to place where Income-tax Department had centralised wing--Order after considering objections of assessee--Order valid--Income-tax Act, 1961, s. 127-- Shree Ram Vessel Scrap P. Ltd . v. CIT (Guj) . . . 255
----Search and seizure--Warrant of authorisation in names of family members of assessee--Assessee’s name mentioned in search warrants--Reasons for transfer of case communicated to assessee--Adequate opportunity given to assessee to raise objections--Transfer of case for co-ordinated investigation and administrative convenience valid--Income-tax Act, 1961, s. 127-- J. R. Tantia Charitable Trust v . Dy. CIT
(Raj) . . . 226
----Transfer on ground of co-ordinated investigation and administrative convenience--Notice--Whether requirement of recording reasons is a mandatory direction and non-communication of reasons is a serious infirmity--Matter referred to larger Bench--Income-tax Act, 1961, s. 127-- Millennium Houseware v. CIT
(Guj) . . . 242
Writ --Scope of powers of High Court--Constitution of India, art. 226-- Shree Ram Vessel Scrap P. Ltd . v . CIT (Guj) . . . 255
SECTIONWISE INDEX TO CASES REPORTED IN THIS PART
Art. 226 --Writ--Scope of powers of High Court-- Shree Ram Vessel Scrap P. Ltd . v . CIT (Guj) . . . 255
Double Taxation Avoidance Agreement between India and the U. S. A. :
Art. 12 --Deduction of tax at source--Payment to non-resident--Royalty--Meaning of--Web-based foreign publishing house--Assessee subscribing for data base--Payments to foreign publishing house constitute royalty--Tax deductible at source-- CIT v . Wipro Ltd. (Karn) . . . 284
S. 2(14)(iii)(a) --Capital gains--Agricultural land--Capital asset--Definition--Land situate in State of Punjab within specified distance from municipality falling in State of Haryana--Urban land for purposes of definition of capital asset--Gains on sale of agricultural land assessable as capital gains-- CIT v . Smt. Anjana Sehgal
(P&H) . . . 294
S. 9(1)(vi) --Deduction of tax at source--Payment to non-resident--Royalty--Meaning of--Web-based foreign publishing house--Assessee subscribing for data base--Payments to foreign publishing house constitute royalty--Tax deductible at source-- CIT v . Wipro Ltd. (Karn) . . . 284
S. 10 --Charitable purposes--Charitable trust--Registration of trust--Scope of section 12AA--Income-tax authorities to examine genuineness of trust--Application of income of trust not to be considered-- CIT v. Surya Educational and Charitable Trust (P&H) . . . 280
S. 11 --Charitable purposes--Charitable trust--Registration of trust--Scope of section 12AA--Income-tax authorities to examine genuineness of trust--Application of income of trust not to be considered-- CIT v. Surya Educational and Charitable Trust (P&H) . . . 280
S. 12 --Charitable purposes--Charitable trust--Registration of trust--Scope of section 12AA--Income-tax authorities to examine genuineness of trust--Application of income of trust not to be considered-- CIT v. Surya Educational and Charitable Trust (P&H) . . . 280
S. 12AA --Charitable purposes--Charitable trust--Registration of trust--Scope of section 12AA--Income-tax authorities to examine genuineness of trust--Application of income of trust not to be considered-- CIT v. Surya Educational and Charitable Trust (P&H) . . . 280
S. 41(1) --Remission or cessation of liability--Condition that allowance or deduction ought to have been made in assessment for any year in respect of any loss, expenditure or trading liability incurred by assessee--No allowance or deduction made in assessment of assessee in any earlier year--Section 41(1) has no application-- CIT v . Shivali Construction Pvt. Ltd. (Delhi) . . . 218
S. 43(1), Expln. 10 --Depreciation--Actual cost--Subsidy--Government company formed to take over telecommunications business carried on by Government Department--Assets transferred at book value--Consideration paid in form of shares, debts and reserves--Book value of equity share consists of not only paid up capital but also reserves and surpluses--Reserves not a subsidy, grant or reimbursement for meeting cost of assets transferred--Reserves not to be reduced from fixed assets to arrive at actual cost-- Bharat Sanchar Nigam Ltd. v . Dy. CIT (Delhi) . . . 188
S. 127 --Transfer of cases--Discretion to be used for public purpose--Effective and co-ordinated investigation good ground for transfer of cases--Order of transfer to place where Income-tax Department had centralised wing--Order after considering objections of assessee--Order valid-- Shree Ram Vessel Scrap P. Ltd . v. CIT (Guj) . . . 255
----Transfer of case--Search and seizure--Warrant of authorisation in names of family members of assessee--Assessee’s name mentioned in search warrants--Reasons for transfer of case communicated to assessee--Adequate opportunity given to assessee to raise objections--Transfer of case for co-ordinated investigation and administrative convenience valid-- J. R. Tantia Charitable Trust v . Dy. CIT (Raj) . . . 226
----Transfer of case--Transfer on ground of co-ordinated investigation and administrative convenience--Notice--Whether requirement of recording reasons is a mandatory direction and non-communication of reasons is a serious infirmity--Matter referred to larger Bench-- Millennium Houseware v. CIT (Guj) . . . 242
S. 143(3) --Reassessment--Not permissible on mere change of opinion--Wholly owned Government company formed to take over telecommunications business carried on by Government Department--Assets transferred at book value--Consideration paid in form of shares, debts and reserves--Assessment after calling for explanations as to capital structure--Reassessment to withdraw excess depreciation to extent cost of assets met by reserves--Mere change of opinion--Not permissible-- Bharat Sanchar Nigam Ltd. v . Dy. CIT (Delhi) . . . 188
S. 147 --Reassessment--Not permissible on mere change of opinion--Wholly owned Government company formed to take over telecommunications business carried on by Government Department--Assets transferred at book value--Consideration paid in form of shares, debts and reserves--Assessment after calling for explanations as to capital structure--Reassessment to withdraw excess depreciation to extent cost of assets met by reserves--Mere change of opinion--Not permissible-- Bharat Sanchar Nigam Ltd. v . Dy. CIT (Delhi) . . . 188
S. 147, Expln. 3 --Reassessment--Assessing Officer--Powers--Effect of Explanation 3 to section 147--Assessing Officer not making additions with respect to ground on basis of which notice issued--Cannot in a fresh assessment make additions on other issues which did not form part of reasons recorded-- CIT v . Mohmed Juned Dadani
(Guj) . . . 172
148 --Reassessment--Assessing Officer--Powers--Effect of Explanation 3 to section 147--Assessing Officer not making additions with respect to ground on basis of which notice issued--Cannot in a fresh assessment make additions on other issues which did not form part of reasons recorded-- CIT v . Mohmed Juned Dadani (Guj) . . . 172
----Reassessment--Not permissible on mere change of opinion--Wholly owned Government company formed to take over telecommunications business carried on by Government Department--Assets transferred at book value--Consideration paid in form of shares, debts and reserves--Assessment after calling for explanations as to capital structure--Reassessment to withdraw excess depreciation to extent cost of assets met by reserves--Mere change of opinion--Not permissible-- Bharat Sanchar Nigam Ltd. v . Dy. CIT (Delhi) . . . 188
S. 153A(a) --Search and seizure--Assessment in search cases--Undisclosed income--Notice--Notice calling for true and correct return for assessment year 2008-09 in prescribed form--Assessee not complying with notice--Objections pending and no final order passed--Writ petition premature and not maintainable-- J. R. Tantia Charitable Trust v . Dy. CIT (Raj) . . . 226
S. 158BC --Search and seizure--Block assessment--Agricultural income--Assessee adopting son of his brother in whose name lands stood--Brother of assessee in charge of agricultural income--No evidence that brothers divided income equally--No addition could be made in hands of assessee-- CIT v . Dr. K. P. Viswanath Prabhu
(Karn) . . . 163
----Search and seizure--Block assessment--Medical practitioner--Undisclosed income on account of investments--Investments out of professional receipts recorded in diaries maintained by assessee found during search--Investments in diaries disclosed in regular returns--Protective assessment including such investments--Accrual of interest on investments--Not undisclosed income of assessee-- CIT v . Dr. K. P. Viswanath Prabhu (Karn) . . . 163
----Search and seizure--Block assessment--Undisclosed income--Addition on account of value of car, education expenses and stock of medicines--Tribunal finding all these acquired out of surplus amount and not acquired out of undisclosed income--No addition could be made to the declared undisclosed income-- CIT v . Dr. K. P. Viswanath Prabhu (Karn) . . . 163
S. 195 --Deduction of tax at source--Payment to non-resident--Royalty--Meaning of--Web-based foreign publishing house--Assessee subscribing for data base--Payments to foreign publishing house constitute royalty--Tax deductible at source-- CIT v . Wipro Ltd. (Karn) . . . 284
S. 197 --Deduction of tax at source--Certificate for non-deduction--Income--Accrual of income--Arbitral award--Interest on sum deposited under interim order pending appeal against order of single judge on award--No absolute right to receive interest--Entitlement contingent on outcome of challenge to arbitral award--Denial of certificate of no deduction of tax at source--Not justified-- DSL Enterprises P. Ltd. v . Mrs. N. C. Chandratre, Income-tax Officer, TDS -1 (Bom) . . . 209
S. 201(1) --Deduction of tax at source--Payment to non-resident--Royalty--Meaning of--Web-based foreign publishing house--Assessee subscribing for data base--Payments to foreign publishing house constitute royalty--Tax deductible at source-- CIT v . Wipro Ltd. (Karn) . . . 284
S. 201(1A) --Deduction of tax at source--Payment to non-resident--Royalty--Meaning of--Web-based foreign publishing house--Assessee subscribing for data base--Payments to foreign publishing house constitute royalty--Tax deductible at source-- CIT v . Wipro Ltd. (Karn) . . . 284
S. 234A --Return of income--Failure to file--Interest--No material to show delay on part of Revenue in giving seized materials was reason for delay in filing return--No relief could be granted-- Sri Sivapriya Shelters Pvt. Ltd . v. Dy. CIT (Karn) . . . 221
-CA.RAJU SHAH
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