ITR'S TRIBUNAL TAX REPORTS (ITR (TRIB)) -- PRINT AND ONLINE EDITION
SUBJECT INDEX TO CASES REPORTED
Business expenditure --Voluntary retirement scheme--Amortisation of expenditure--Compliance with conditions of rule 2BA mandatory only for exemption under section 10(10C) by employee--Not relevant for deduction in employer’s hands under section 35DDA --One-fifth of expenditure allowable under section 35DDA --Income-tax Act, 1961 , ss . 10(10C), 35DDA --Income-tax Rules, 1962 , r . 2BA -- State Bank of Mysore v. CIT (Appeals) (Bangalore). . .244
Industrial undertaking --Special category State--Special deduction--Return filed belatedly--Explanation that computer got corrupted due to virus and computer technical personnel unable to retrieve data in time and entire data for February and March had to be entered into computer again--Reasonable cause beyond control of assessee--Deduction not to be denied on technicalities when assessee otherwise entitled--Income-tax Act, 1961, ss. 80AC, 80-IC, 139(1)-- ITO v. S. Venkataiah (Hyderabad) . . .256
Non-resident --Shipping company--Income deemed to accrue or arise in India--Profit from operation of ships in international traffic--Not taxable in India under article 9(1)--Income-tax Act, 1961, s. 9--Double Taxation Avoidance Agreement between India and Denmark, art. 9-- A. P. Moller Maersk A/S v. Deputy Director of Income-tax (International Taxation) (Mumbai). . . 253
----Shipping company--Interest on refund received from foreign shipping company--Falling under article 12 of Double Taxation Avoidance Agreement--Liable to tax--Cannot be considered as business income under article 9(4)--Double Taxation Avoidance Agreement between India and Denmark, arts. 9(4), 12-- A. P. Moller Maersk A/S v. Deputy Director of Income-tax (International Taxation) (Mumbai). . . 253
Volume 26 : Part 1 (Issue dated : 26-8-2013)
SUBJECT INDEX TO CASES REPORTED
Business expenditure --Co-operative bank--Bad and doubtful debts--Bad debts--Netting provisions made for bad and doubtful debts--Net accretion to be ascertained by analysing quality of each asset--No details available on record--Order set aside and matter remanded for decision afresh--Income-tax Act, 1961, s. 36(1)(viia)-- Trichur District Co-operative Bank Ltd. v. Assistant CIT (Cochin) . . . 31
----Co-operative bank--Bad and doubtful debts--Bad debts--Rural branch--Definition under section 36(1)(viia) applicable--Income-tax Act, 1961, s. 36(1)(viia)-- Trichur District Co-operative Bank Ltd. v. Assistant CIT (Cochin) . . . 31
----Foreign bank--Commission on collection and mobilisation of deposits from non-resident Indians for State Bank of India under its India millennium deposit scheme for five years--Expenses on sub-arrangers fees--Net amount amortised in books of account over five years--Payment not made in lieu of “services of technical or other personnel†by non-resident sub-arrangers--Not consideration for construction or assembly--Activities of sub-arrangers not “consultancy services†--No technical knowledge, expertise or qualification required--Sub-arrangers not managing India millennium deposit issue--Payment not fees for “managerial services†--Payment not within ambit of “fees for technical services†in section 9(1)(vii)--Sub-arrangers simply acting as commission agents or brokers and payment simply a commission or brokerage paid by assessee--Provisions requiring deduction of tax at source not applicable--No disallowance--Expenses eligible for deduction in full year of incurring--No relation with life of deposits received by assessee from SBI--Income-tax Act, 1961, ss. 9(1)(vii), 40(a)(i), 195-- Credit Lyonnais v. Assistant Director of Income-tax (International Taxation)
(Mumbai) . . . 51
----Venture capital fund--Trusteeship and management fees--No evidence to prove that expenses not genuine--Expenditure allowable--Income-tax Act, 1961-- Assistant CIT v. Small is Beautiful (Hyderabad) . . . 41
Capital gains --Non-resident--Sale of 100 per cent. shareholding in Indian company to Singapore company--Indian company’s business undertaking notified as eligible under section 80-IA(4)(iii) --Approved under section 10(23G)--Share held by company not “immovable property†--Capital gains arising on transfer of shares not governed by article 13(1) or (4) but by article 13(5)--Not taxable in India--Income-tax Act, 1961, ss. 2(47), 10(23G), 80-IA(4)(iii), 269UA(d)--Double Taxation Avoidance Agreement between India and the Netherlands, arts. 6(2), 13-- Vanenburg Facilities B. V. v. Assistant Director of Income-tax (International Taxation) (Hyderabad) . . . 114
Co-operative society --Special deduction--Cannot be decided without detailed examination of bye-laws and relevant materials--Verification not carried out by Assessing Officer or Commissioner (Appeals)--Order set aside and matter remanded for decision afresh--Income-tax Act, 1961, s. 80P(2)(a)(vi)-- ITO v. Indian Coffee Board Workers Co-operative Society (Cochin) . . . 93
Company --Shares--Shares in company not immovable property-- Vanenburg Facilities B. V. v. Assistant Director of Income-tax (International Taxation) (Hyderabad) . . . 114
Exemption --Industrial undertaking--No condition that exemption applicable only for further investment--Indian company approved as an infrastructure company and allowed deduction under section 80-IA--Conditions satisfied at time of sale of shares in company--Capital gains eligible for exemption--Income-tax Act, 1961, ss. 10(23G), 80-IA(4)(iii)-- Vanenburg Facilities B. V. v. Assistant Director of Income-tax (International Taxation) (Hyderabad) . . . 114
----Venture capital fund--Settlement of violation of provisions, under consent terms not material--Approval not withdrawn by SEBI--Assessee entitled to exemption--Income-tax Act, 1961, s. 10(23FB)-- Assistant CIT v. Small is Beautiful (Hyderabad) . . . 41
Fringe benefits tax --Condition precedent for charge of tax--Employer-employee relationship essential of treating expenses as fringe benefit--Airline crew members not employees--Visiting guests not employees--Expenses on transportation of airline crew and guests not chargeable--Expenses on dropping employees at night time not treated as fringe benefit--Not liable to fringe benefit tax--Income-tax Act, 1961, s. 115WB(2)(B), (D)--Circular No. 8 of 2005 dated August 29, 2005-- Peerless Hotels Ltd. v. Deputy CIT (Kolkata) . . . 151
----Private television channel--Broadcasting news through its four news channel--Channel-placement charges paid to agencies--No employer-employee relationship between assessee and recipients--Not expenditure on sales promotion or publicity--Not liable to fringe benefits tax--Income-tax Act, 1961, s. 115WB(2)--CBDT Circular No. 8 of 2005 dated August 29, 2005-- T. V. Today Network Ltd. v. Deputy CIT (Delhi) . . . 1
Housing project --Special deduction--Change of law with effect from April 1, 2005--Furnishing of completion certificate issued by local authority--Mandatory for years after amendment--Not requirement for earlier years--Deduction for earlier years not to be denied for not submitting completion certificate--No requirement that undertaking must be owner of land--Income-tax Act, 1961, s. 80-IB(10)-- Sainath Estates P. Ltd. v. Deputy CIT (Hyderabad) . . . 155
Income --Disallowance of expenses in relation to exempt income--Exemption--Interest on borrowings in foreign currency--Capital and free reserves far in excess of amount invested in interest-free securities--No disallowance on account of interest paid for making investment in such securities--2 per cent. of exempt income to be disallowed towards operating expenses--Income-tax Act, 1961, ss. 10(15)(iv)(h), 14A-- Credit Lyonnais v. Assistant Director of Income-tax (International Taxation) (Mumbai) . . . 51
Income from house property --Property given on lease--Tribunal for earlier years directing Assessing Officer to recompute income from house property following return on investment method applying rate of 7 per cent. enhanced by applying cost inflation index--Commissioner (Appeals) following direction of Tribunal for year in question--No reason for interference--Failure by assessee to submit details called for by Assessing Officer in support of construction and administrative expenses--Commissioner (Appeals) not justified in allowing expenditure claimed by assessee in toto--On facts disallowance of 5 per cent. of expenditure appropriate--Income-tax Act, 1961, s. 22-- Sainath Estates P. Ltd. v. Deputy CIT (Hyderabad) . . . 155
Income or capital --Benefit on account of unmatured foreign exchange contracts as on last day of accounting year--Credited to profit and loss account--Taxable-- Credit Lyonnais v. Assistant Director of Income-tax (International Taxation) (Mumbai) . . . 51
Industrial undertaking --Special deduction--Small-scale industrial unit--Conditions precedent for grant of deduction--Must be fulfilled each year--Value of plant and machinery in year exceeding Rs. 1 crore--Assessee not qualifying as small scale industry--Not entitled to deduction--Income-tax Act, 1961, s. 80-IB-- Ace Multi Axes Systems Ltd. v. Deputy CIT (Bangalore) . . . 83
Interpretation of taxing statutes --Language clear and unambiguous--No scope for interpretation-- Sainath Estates P. Ltd. v. Deputy CIT (Hyderabad) . . . 155
Non-resident --Income deemed to accrue or arise in India--Deduction of tax at source--Fees for technical services--Export of readymade garments under orders procured by foreign agent--Foreign agent providing systematic market research--Service falls under definition of technical services--Payment is fees for technical services--Assessee liable to deduct tax at source--Income-tax Act, 1961, ss. 9(1)(vii), 40(a)(ia), 195-- Assistant CIT v. Evolv Clothing Co. P. Ltd. (Chennai) . . . 71
----Taxability in India--Transfer of shares in Indian company to another non-resident--Interest for delay in payment of sale consideration--Neither assessee nor purchaser carrying on business in India nor interest payable in respect of moneys borrowed and used for purpose of business--Interest received outside India--Not taxable in India--Income-tax Act, 1961, ss. 5, 9(1)(v)(c)-- Vanenburg Facilities B. V. v. Assistant Director of Income-tax (International Taxation) (Hyderabad) . . . 114
Reassessment --Material gathered during search considered in block assessment--Assessing Officer thereafter not entitled to initiate proceedings under section 147 on issue--Assessment made after scrutiny allowing exemption on long-term capital gains for purchase of residential house--Order affirmed on appeal and becoming final--Block assessment made pursuant to search disallowing exemption set aside on ground of lack of jurisdiction--Reassessment to disallow exemption--Not permissible--Income-tax Act, 1961, ss. 54F, 143(3), 147, 148, 158B(b), 158BD-- Motilal P. Khinvasara, HUF v. Deputy CIT (Pune) . . . 101
Refund --Interest on excess refund--Provision brought with effect from June 1, 2003--Assessment for 2001-02 completed after that date--Interest chargeable--Income-tax Act, 1961, s. 234D-- Credit Lyonnais v. Assistant Director of Income-tax (International Taxation) (Mumbai) . . . 51
Search and seizure --Assessment in search cases--Income from house property--Property leased out--Net annual value of property quantified in assessment under section 143(3)--Same addition not to be made again in assessment under section 153A--Validity of addition made in assessment under section 143(3) not to be adjudicated by Tribunal in appeal arising from search assessment--Income-tax Act, 1961, ss. 143(3), 153A-- Sainath Estates P. Ltd. v. Deputy CIT (Hyderabad) . . . 155
----Assessment in search cases--Scope of powers of Assessing Officer--That issue of claim to deduction under section 80-IB(10) considered in original assessment under section 143(3) not relevant--That issue of fulfilment of conditions under section 80-IB(10) verified in original scrutiny assessment proceedings not ground for not furnishing required information and evidence called for in proceedings under section 153A--Matter remanded--Income-tax Act, 1961, ss. 80-IB(10), 143(3), 153A-- Sainath Estates P. Ltd. v. Deputy CIT (Hyderabad) . . . 155
----General principles--Block assessment--Limitation--Department not entitled to prolong search in arbitrary and unjustified manner--Time-limit for framing order cannot be extended by passing prohibitory orders--Assessment of third party--Satisfaction for taking action to be recorded before completion of block assessment of person searched--Two searches--Panchanamas mentioning that second search was in continuation of previous proceedings--No document or books of account seized or taken into possession--No fresh authorisation or revalidation of earlier authorisation--Total period of search lasting more than nine months--Much beyond reasonable time--Limitation to be reckoned taking into consideration last valid panchanama--Assessment barred by limitation--Income-tax Act, 1961, ss. 132(3), 158BB, 158BC, 158BD, 158BE-- Mani and Money Ltd. v. Deputy CIT (Chennai) . . . 9
Words and phrases --“Immovable property†-- Vanenburg Facilities B. V. v. Assistant Director of Income-tax (International Taxation) (Hyderabad) . . . 114
SECTIONWISE INDEX TO CASES REPORTED IN THIS PART
Double Taxation Avoidance Agreement between India and the Netherlands :
Art. 6(2) --Capital gains--Non-resident--Sale of 100 per cent. shareholding in Indian company to Singapore company--Indian company’s business undertaking notified as eligible under section 80-IA(4)(iii) --Approved under section 10(23G)--Share held by company not “immovable property†--Capital gains arising on transfer of shares not governed by article 13(1) or (4) but by article 13(5)--Not taxable in India-- Vanenburg Facilities B. V. v. Assistant Director of Income-tax (International Taxation) (Hyderabad) . . . 114
Art. 13 --Capital gains--Non-resident--Sale of 100 per cent. shareholding in Indian company to Singapore company--Indian company’s business undertaking notified as eligible under section 80-IA(4)(iii) --Approved under section 10(23G)--Share held by company not “immovable property†--Capital gains arising on transfer of shares not governed by article 13(1) or (4) but by article 13(5)--Not taxable in India-- Vanenburg Facilities B. V. v. Assistant Director of Income-tax (International Taxation) (Hyderabad) . . . 114
S. 2(47) --Capital gains--Non-resident--Sale of 100 per cent. shareholding in Indian company to Singapore company--Indian company’s business undertaking notified as eligible under section 80-IA(4)(iii) --Approved under section 10(23G)--Share held by company not “immovable property†--Capital gains arising on transfer of shares not governed by article 13(1) or (4) but by article 13(5)--Not taxable in India-- Vanenburg Facilities B. V. v. Assistant Director of Income-tax (International Taxation) (Hyderabad) . . . 114
S. 5 --Non-resident--Taxability in India--Transfer of shares in Indian company to another non-resident--Interest for delay in payment of sale consideration--Neither assessee nor purchaser carrying on business in India nor interest payable in respect of moneys borrowed and used for purpose of business--Interest received outside India--Not taxable in India-- Vanenburg Facilities B. V. v. Assistant Director of Income-tax (International Taxation) (Hyderabad) . . . 114
S. 9(1)(v)(c) --Non-resident--Taxability in India--Transfer of shares in Indian company to another non-resident--Interest for delay in payment of sale consideration--Neither assessee nor purchaser carrying on business in India nor interest payable in respect of moneys borrowed and used for purpose of business--Interest received outside India--Not taxable in India-- Vanenburg Facilities B. V. v. Assistant Director of Income-tax (International Taxation) (Hyderabad) . . . 114
S. 9(1)(vii) --Business expenditure--Foreign bank--Commission on collection and mobilisation of deposits from non-resident Indians for State Bank of India under its India millennium deposit scheme for five years--Expenses on sub-arrangers fees--Net amount amortised in books of account over five years--Payment not made in lieu of “services of technical or other personnel†by non-resident sub-arrangers--Not consideration for construction or assembly--Activities of sub-arrangers not “consultancy services†--No technical knowledge, expertise or qualification required--Sub-arrangers not managing India millennium deposit issue--Payment not fees for “managerial services†--Payment not within ambit of “fees for technical services†in section 9(1)(vii)--Sub-arrangers simply acting as commission agents or brokers and payment simply a commission or brokerage paid by assessee--Provisions requiring deduction of tax at source not applicable--No disallowance--Expenses eligible for deduction in full year of incurring--No relation with life of deposits received by assessee from SBI-- Credit Lyonnais v. Assistant Director of Income-tax (International Taxation) (Mumbai) . . . 51
----Non-resident--Income deemed to accrue or arise in India--Deduction of tax at source--Fees for technical services--Export of readymade garments under orders procured by foreign agent--Foreign agent providing systematic market research--Service falls under definition of technical services--Payment is fees for technical services--Assessee liable to deduct tax at source-- Assistant CIT v. Evolv Clothing Co. P. Ltd. (Chennai) . . . 71
S. 10(15)(iv)(h) --Income--Disallowance of expenses in relation to exempt income--Exemption--Interest on borrowings in foreign currency--Capital and free reserves far in excess of amount invested in interest-free securities--No disallowance on account of interest paid for making investment in such securities--2 per cent. of exempt income to be disallowed towards operating expenses-- Credit Lyonnais v. Assistant Director of Income-tax (International Taxation) (Mumbai) . . . 51
S. 10(23FB) --Exemption--Venture capital fund--Settlement of violation of provisions, under consent terms not material--Approval not withdrawn by SEBI--Assessee entitled to exemption-- Assistant CIT v. Small is Beautiful (Hyderabad) . . . 41
S. 10(23G) --Capital gains--Non-resident--Sale of 100 per cent. shareholding in Indian company to Singapore company--Indian company’s business undertaking notified as eligible under section 80-IA(4)(iii)--Approved under section 10(23G)--Share held by company not “immovable property†--Capital gains arising on transfer of shares not governed by article 13(1) or (4) but by article 13(5)--Not taxable in India-- Vanenburg Facilities B. V. v. Assistant Director of Income-tax (International Taxation) (Hyderabad) . . . 114
----Exemption--Industrial undertaking--No condition that exemption applicable only for further investment--Indian company approved as an infrastructure company and allowed deduction under section 80-IA--Conditions satisfied at time of sale of shares in company--Capital gains eligible for exemption-- Vanenburg Facilities B. V. v. Assistant Director of Income-tax (International Taxation) (Hyderabad) . . . 114
S. 14A --Income--Disallowance of expenses in relation to exempt income--Exemption--Interest on borrowings in foreign currency--Capital and free reserves far in excess of amount invested in interest-free securities--No disallowance on account of interest paid for making investment in such securities--2 per cent. of exempt income to be disallowed towards operating expenses-- Credit Lyonnais v. Assistant Director of Income-tax (International Taxation) (Mumbai) . . . 51
S. 22 --Income from house property--Property given on lease--Tribunal for earlier years directing Assessing Officer to recompute income from house property following return on investment method applying rate of 7 per cent. enhanced by applying cost inflation index--Commissioner (Appeals) following direction of Tribunal for year in question--No reason for interference--Failure by assessee to submit details called for by Assessing Officer in support of construction and administrative expenses--Commissioner (Appeals) not justified in allowing expenditure claimed by assessee in toto--On facts disallowance of 5 per cent. of expenditure appropriate-- Sainath Estates P. Ltd. v. Deputy CIT (Hyderabad) . . . 155
S. 36(1)(viia) --Business expenditure--Co-operative bank--Bad and doubtful debts--Bad debts--Netting provisions made for bad and doubtful debts--Net accretion to be ascertained by analysing quality of each asset--No details available on record--Order set aside and matter remanded for decision afresh-- Trichur District Co-operative Bank Ltd. v. Assistant CIT (Cochin) . . . 31
----Business expenditure--Co-operative bank--Bad and doubtful debts--Bad debts--Rural branch--Definition under section 36(1)(viia) applicable-- Trichur District Co-operative Bank Ltd. v. Assistant CIT (Cochin) . . . 31
S. 40(a)(i) --Business expenditure--Foreign bank--Commission on collection and mobilisation of deposits from non-resident Indians for State Bank of India under its India millennium deposit scheme for five years--Expenses on sub-arrangers fees--Net amount amortised in books of account over five years--Payment not made in lieu of “services of technical or other personnel†by non-resident sub-arrangers--Not consideration for construction or assembly--Activities of sub-arrangers not “consultancy services†--No technical knowledge, expertise or qualification required--Sub-arrangers not managing India millennium deposit issue--Payment not fees for “managerial services†--Payment not within ambit of “fees for technical services†in section 9(1)(vii)--Sub-arrangers simply acting as commission agents or brokers and payment simply a commission or brokerage paid by assessee--Provisions requiring deduction of tax at source not applicable--No disallowance--Expenses eligible for deduction in full year of incurring--No relation with life of deposits received by assessee from SBI-- Credit Lyonnais v. Assistant Director of Income-tax (International Taxation) (Mumbai) . . . 51
S. 40(a)(ia) --Non-resident--Income deemed to accrue or arise in India--Deduction of tax at source--Fees for technical services--Export of readymade garments under orders procured by foreign agent--Foreign agent providing systematic market research--Service falls under definition of technical services--Payment is fees for technical services--Assessee liable to deduct tax at source-- Assistant CIT v. Evolv Clothing Co. P. Ltd. (Chennai) . . . 71
S. 54F --Reassessment--Material gathered during search considered in block assessment--Assessing Officer thereafter not entitled to initiate proceedings under section 147 on issue--Assessment made after scrutiny allowing exemption on long-term capital gains for purchase of residential house--Order affirmed on appeal and becoming final--Block assessment made pursuant to search disallowing exemption set aside on ground of lack of jurisdiction--Reassessment to disallow exemption--Not permissible-- Motilal P. Khinvasara, HUF v. Deputy CIT (Pune) . . . 101
S. 80-IA(4)(iii) --Capital gains--Non-resident--Sale of 100 per cent. shareholding in Indian company to Singapore company--Indian company’s business undertaking notified as eligible under section 80-IA(4)(iii)--Approved under section 10(23G)--Share held by company not “immovable property†--Capital gains arising on transfer of shares not governed by article 13(1) or (4) but by article 13(5)--Not taxable in India-- Vanenburg Facilities B. V. v. Assistant Director of Income-tax (International Taxation) (Hyderabad) . . . 114
----Exemption--Industrial undertaking--No condition that exemption applicable only for further investment--Indian company approved as an infrastructure company and allowed deduction under section 80-IA--Conditions satisfied at time of sale of shares in company--Capital gains eligible for exemption-- Vanenburg Facilities B. V. v. Assistant Director of Income-tax (International Taxation) (Hyderabad) . . . 114
S. 80-IB --Industrial undertaking--Special deduction--Small-scale industrial unit--Conditions precedent for grant of deduction--Must be fulfilled each year--Value of plant and machinery in year exceeding Rs. 1 crore--Assessee not qualifying as small scale industry--Not entitled to deduction-- Ace Multi Axes Systems Ltd. v. Deputy CIT (Bangalore) . . . 83
S. 80-IB(10) --Housing project--Special deduction--Change of law with effect from April 1, 2005--Furnishing of completion certificate issued by local authority--Mandatory for years after amendment--Not requirement for earlier years--Deduction for earlier years not to be denied for not submitting completion certificate--No requirement that undertaking must be owner of land-- Sainath Estates P. Ltd. v. Deputy CIT (Hyderabad) . . . 155
----Search and seizure--Assessment in search cases--Scope of powers of Assessing Officer--That issue of claim to deduction under section 80-IB(10) considered in original assessment under section 143(3) not relevant--That issue of fulfilment of conditions under section 80-IB(10) verified in original scrutiny assessment proceedings not ground for not furnishing required information and evidence called for in proceedings under section 153A--Matter remanded-- Sainath Estates P. Ltd. v. Deputy CIT (Hyderabad) . . . 155
S. 80P(2)(a)(vi) --Co-operative society--Special deduction--Cannot be decided without detailed examination of bye-laws and relevant materials--Verification not carried out by Assessing Officer or Commissioner (Appeals)--Order set aside and matter remanded for decision afresh-- ITO v. Indian Coffee Board Workers Co-operative Society (Cochin) . . . 93
S. 115WB(2) --Fringe benefits tax--Private television channel--Broadcasting news through its four news channel--Channel-placement charges paid to agencies--No employer-employee relationship between assessee and recipients--Not expenditure on sales promotion or publicity--Not liable to fringe benefits tax-- T. V. Today Network Ltd. v. Deputy CIT (Delhi) . . . 1
S. 115WB(2)(B), (D) --Fringe benefits tax--Condition precedent for charge of tax--Employer-employee relationship essential of treating expenses as fringe benefit--Airline crew members not employees--Visiting guests not employees--Expenses on transportation of airline crew and guests not chargeable--Expenses on dropping employees at night time not treated as fringe benefit--Not liable to fringe benefit tax-- Peerless Hotels Ltd. v. Deputy CIT (Kolkata) . . . 151
S. 132(3) --Search and seizure--General principles--Block assessment--Limitation--Department not entitled to prolong search in arbitrary and unjustified manner--Time-limit for framing order cannot be extended by passing prohibitory orders--Assessment of third party--Satisfaction for taking action to be recorded before completion of block assessment of person searched--Two searches--Panchanamas mentioning that second search was in continuation of previous proceedings--No document or books of account seized or taken into possession--No fresh authorisation or revalidation of earlier authorisation--Total period of search lasting more than nine months--Much beyond reasonable time--Limitation to be reckoned taking into consideration last valid panchanama--Assessment barred by limitation-- Mani and Money Ltd. v. Deputy CIT (Chennai) . . . 9
S. 143(3) --Reassessment--Material gathered during search considered in block assessment--Assessing Officer thereafter not entitled to initiate proceedings under section 147 on issue--Assessment made after scrutiny allowing exemption on long-term capital gains for purchase of residential house--Order affirmed on appeal and becoming final--Block assessment made pursuant to search disallowing exemption set aside on ground of lack of jurisdiction--Reassessment to disallow exemption--Not permissible-- Motilal P. Khinvasara, HUF v. Deputy CIT (Pune) . . . 101
----Search and seizure--Assessment in search cases--Income from house property--Property leased out--Net annual value of property quantified in assessment under section 143(3)--Same addition not to be made again in assessment under section 153A--Validity of addition made in assessment under section 143(3) not to be adjudicated by Tribunal in appeal arising from search assessment-- Sainath Estates P. Ltd. v. Deputy CIT (Hyderabad) . . . 155
----Search and seizure--Assessment in search cases--Scope of powers of Assessing Officer--That issue of claim to deduction under section 80-IB(10) considered in original assessment under section 143(3) not relevant--That issue of fulfilment of conditions under section 80-IB(10) verified in original scrutiny assessment proceedings not ground for not furnishing required information and evidence called for in proceedings under section 153A--Matter remanded-- Sainath Estates P. Ltd. v. Deputy CIT (Hyderabad) . . . 155
S. 147 --Reassessment--Material gathered during search considered in block assessment--Assessing Officer thereafter not entitled to initiate proceedings under section 147 on issue--Assessment made after scrutiny allowing exemption on long-term capital gains for purchase of residential house--Order affirmed on appeal and becoming final--Block assessment made pursuant to search disallowing exemption set aside on ground of lack of jurisdiction--Reassessment to disallow exemption--Not permissible-- Motilal P. Khinvasara, HUF v. Deputy CIT (Pune) . . . 101
S. 148 --Reassessment--Material gathered during search considered in block assessment--Assessing Officer thereafter not entitled to initiate proceedings under section 147 on issue--Assessment made after scrutiny allowing exemption on long-term capital gains for purchase of residential house--Order affirmed on appeal and becoming final--Block assessment made pursuant to search disallowing exemption set aside on ground of lack of jurisdiction--Reassessment to disallow exemption--Not permissible-- Motilal P. Khinvasara, HUF v. Deputy CIT (Pune) . . . 101
S. 153A --Search and seizure--Assessment in search cases--Income from house property--Property leased out--Net annual value of property quantified in assessment under section 143(3)--Same addition not to be made again in assessment under section 153A--Validity of addition made in assessment under section 143(3) not to be adjudicated by Tribunal in appeal arising from search assessment-- Sainath Estates P. Ltd. v. Deputy CIT (Hyderabad) . . . 155
----Search and seizure--Assessment in search cases--Scope of powers of Assessing Officer--That issue of claim to deduction under section 80-IB(10) considered in original assessment under section 143(3) not relevant--That issue of fulfilment of conditions under section 80-IB(10) verified in original scrutiny assessment proceedings not ground for not furnishing required information and evidence called for in proceedings under section 153A--Matter remanded-- Sainath Estates P. Ltd. v. Deputy CIT (Hyderabad) . . . 155
S. 158B(b) --Reassessment--Material gathered during search considered in block assessment--Assessing Officer thereafter not entitled to initiate proceedings under section 147 on issue--Assessment made after scrutiny allowing exemption on long-term capital gains for purchase of residential house--Order affirmed on appeal and becoming final--Block assessment made pursuant to search disallowing exemption set aside on ground of lack of jurisdiction--Reassessment to disallow exemption--Not permissible-- Motilal P. Khinvasara, HUF v. Deputy CIT (Pune) . . . 101
S. 158BB --Search and seizure--General principles--Block assessment--Limitation--Department not entitled to prolong search in arbitrary and unjustified manner--Time-limit for framing order cannot be extended by passing prohibitory orders--Assessment of third party--Satisfaction for taking action to be recorded before completion of block assessment of person searched--Two searches--Panchanamas mentioning that second search was in continuation of previous proceedings--No document or books of account seized or taken into possession--No fresh authorisation or revalidation of earlier authorisation--Total period of search lasting more than nine months--Much beyond reasonable time--Limitation to be reckoned taking into consideration last valid panchanama--Assessment barred by limitation-- Mani and Money Ltd. v. Deputy CIT (Chennai) . . . 9
S. 158BC --Search and seizure--General principles--Block assessment--Limitation--Department not entitled to prolong search in arbitrary and unjustified manner--Time-limit for framing order cannot be extended by passing prohibitory orders--Assessment of third party--Satisfaction for taking action to be recorded before completion of block assessment of person searched--Two searches--Panchanamas mentioning that second search was in continuation of previous proceedings--No document or books of account seized or taken into possession--No fresh authorisation or revalidation of earlier authorisation--Total period of search lasting more than nine months--Much beyond reasonable time--Limitation to be reckoned taking into consideration last valid panchanama--Assessment barred by limitation-- Mani and Money Ltd. v. Deputy CIT (Chennai) . . . 9
S. 158BD --Reassessment--Material gathered during search considered in block assessment--Assessing Officer thereafter not entitled to initiate proceedings under section 147 on issue--Assessment made after scrutiny allowing exemption on long-term capital gains for purchase of residential house--Order affirmed on appeal and becoming final--Block assessment made pursuant to search disallowing exemption set aside on ground of lack of jurisdiction--Reassessment to disallow exemption--Not permissible-- Motilal P. Khinvasara, HUF v. Deputy CIT (Pune) . . . 101
----Search and seizure--General principles--Block assessment--Limitation--Department not entitled to prolong search in arbitrary and unjustified manner--Time-limit for framing order cannot be extended by passing prohibitory orders--Assessment of third party--Satisfaction for taking action to be recorded before completion of block assessment of person searched--Two searches--Panchanamas mentioning that second search was in continuation of previous proceedings--No document or books of account seized or taken into possession--No fresh authorisation or revalidation of earlier authorisation--Total period of search lasting more than nine months--Much beyond reasonable time--Limitation to be reckoned taking into consideration last valid panchanama--Assessment barred by limitation-- Mani and Money Ltd. v. Deputy CIT (Chennai) . . . 9
S. 158BE --Search and seizure--General principles--Block assessment--Limitation--Department not entitled to prolong search in arbitrary and unjustified manner--Time-limit for framing order cannot be extended by passing prohibitory orders--Assessment of third party--Satisfaction for taking action to be recorded before completion of block assessment of person searched--Two searches--Panchanamas mentioning that second search was in continuation of previous proceedings--No document or books of account seized or taken into possession--No fresh authorisation or revalidation of earlier authorisation--Total period of search lasting more than nine months--Much beyond reasonable time--Limitation to be reckoned taking into consideration last valid panchanama--Assessment barred by limitation-- Mani and Money Ltd. v. Deputy CIT (Chennai) . . . 9
S. 195 --Business expenditure--Foreign bank--Commission on collection and mobilisation of deposits from non-resident Indians for State Bank of India under its India millennium deposit scheme for five years--Expenses on sub-arrangers fees--Net amount amortised in books of account over five years--Payment not made in lieu of “services of technical or other personnel†by non-resident sub-arrangers--Not consideration for construction or assembly--Activities of sub-arrangers not “consultancy services†--No technical knowledge, expertise or qualification required--Sub-arrangers not managing India millennium deposit issue--Payment not fees for “managerial services†--Payment not within ambit of “fees for technical services†in section 9(1)(vii)--Sub-arrangers simply acting as commission agents or brokers and payment simply a commission or brokerage paid by assessee--Provisions requiring deduction of tax at source not applicable--No disallowance--Expenses eligible for deduction in full year of incurring--No relation with life of deposits received by assessee from SBI-- Credit Lyonnais v. Assistant Director of Income-tax (International Taxation) (Mumbai) . . . 51
----Non-resident--Income deemed to accrue or arise in India--Deduction of tax at source--Fees for technical services--Export of readymade garments under orders procured by foreign agent--Foreign agent providing systematic market research--Service falls under definition of technical services--Payment is fees for technical services--Assessee liable to deduct tax at source-- Assistant CIT v. Evolv Clothing Co. P. Ltd. (Chennai) . . . 71
S. 234D --Refund--Interest on excess refund--Provision brought with effect from June 1, 2003--Assessment for 2001-02 completed after that date--Interest chargeable-- Credit Lyonnais v. Assistant Director of Income-tax (International Taxation) (Mumbai) . . . 51
S. 269UA(d) --Capital gains--Non-resident--Sale of 100 per cent. shareholding in Indian company to Singapore company--Indian company’s business undertaking notified as eligible under section 80-IA(4)(iii)--Approved under section 10(23G)--Share held by company not “immovable property†--Capital gains arising on transfer of shares not governed by article 13(1) or (4) but by article 13(5)--Not taxable in India-- Vanenburg Facilities B. V. v. Assistant Director of Income-tax (International Taxation) (Hyderabad) . . . 114
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