INCOME TAX REPORTS (ITR)--PRINT AND ONLINE EDITION
SUBJECT INDEX TO CASES REPORTED
Appeal to High Court --Powers of High Court--Question not raised before or considered by Tribunal--Cannot be considered by High Court--Question whether commission receipts were covered by seized cash not raised before or considered by Tribunal--Question could not be considered by High Court--Income-tax Act, 1961, s. 260A-- Smt. Rajrani Gupta v. Deputy CIT (Bom) . . . 416
Capital gains --Exemption--Transfer of capital asset and investment of proceeds in residential property--Investment within extended period of limitation for filing return--Assessee entitled to exemption under section 54F--Income-tax Act, 1961, s. 54F-- CIT v. Jagtar Singh Chawla (P&H) . . . 411
Search and seizure --Block assessment--Undisclosed income--Burden of proof--Burden of proving income was disclosed is on assessee--Amounts disclosed as gifts and shown as capital receipts in returns--Not a disclosure of income--Effect of amendment of section 158BB with retrospective effect from 1995--Evidence relatable to search can be taken into consideration--Gifts from non-resident external accounts--Evidence that gifts were not genuine--Confession and retraction before Enforcement Directorate could be taken into consideration--Amounts shown as gifts assessable as income from undisclosed sources--Income-tax Act, 1961, s. 158BB-- Smt. Rajrani Gupta v. Deputy CIT (Bom) . . . 416
ITR Volume 358 : Part 1 (Issue dated : 28-10-2013)
SUBJECT INDEX TO CASES REPORTED IN THIS PART
Reassessment --Limitation--Notice after four years--Special deduction--Industrial undertaking--Assessment completed on basis of decision of High Court allowing deduction for civil construction--Cannot be reopened after four years solely on basis of subsequent reversal of High Court by Supreme Court--Income-tax Act, 1961, ss. 80HH, 147, 149(1)(a)-- Deputy CIT v. Simplex Concrete Piles (India) Ltd. . . . 129
Appeal to Appellate Tribunal --Powers of Tribunal--Power to remand--Individuals working in various inter-connected organizations--Commission paid by one organization--No return filed by any of the individuals--Order of remand to determine assessability of commission--Justified--Income-tax Act, 1961, s. 2(24)(iv)-- CIT v. C. S. Srivatsan (Mad) . . . 10
Business expenditure --Deduction only on actual payment--Contributions of employees’ State insurance and provident fund deposited prior to filing return under section 139(1)--Allowable--Income-tax Act, 1961, ss. 2(24)(x), 36(1)(va), 43B, 139(1)-- CIT v. Mark Auto Industries Ltd. (P&H) . . . 43
----Disallowance--Expenditure on technical know-how--Expenditure capitalised and not claimed as revenue expenditure--Provision for disallowance for failure to deduct tax at source not applicable--Income-tax Act, 1961, ss. 32, 35AB, 40(a)(i)-- CIT v. Mark Auto Industries Ltd. (P&H) . . . 43
----Disallowance--Payments to non-resident--Failure to deduct tax at source--Circulars in force during relevant year not obliging assessee to deduct tax at source--Circular withdrawing earlier circulars operative only from date of issue and not applicable for earlier years--Circulars binding upon Department--No obligation to deduct tax at source on commission paid to non-resident who was not liable to pay tax in India--Expenditure allowable--Income-tax Act, 1961, ss. 9(1)(vii), 40(a)(ia), 195-- CIT v. Model Exims (All) . . . 72
Capital or revenue expenditure --Expenditure on glow-sign boards displayed at dealer outlets--Revenue--Income-tax Act, 1961, s. 37-- CIT v. Orient Ceramics and Industries Ltd. (Delhi) . . . 49
Charitable purposes --Charitable trust--Business carried on by charitable trust--Meaning of “business†in section 2(15)--Institute of Chartered Accountants of India established to regulate profession of chartered accountants in India--Institute imparting education--Coaching classes conducted by Institute not like private coaching classes--Activity ancillary to educational purposes--Fees charged for coaching classes--Not conclusive--Institute entitled to exemption under section 11--Income-tax Act, 1961, ss. 2(15), 11-- Institute of Chartered Accountants of India v. Director-General of Income-tax (Exemptions) (Delhi) . . . 91
----Charitable trust--Investment of funds of charitable trust--Institute established for regulating profession of chartered accountants in India--Funds of Institute provided to ICAI Accounting Research Foundation--No violation of provisions of section 13--Institute entitled to exemption under section 11--Income-tax Act, 1961, ss. 11, 13-- Institute of Chartered Accountants of India v. Director-General of Income-tax (Exemptions) (Delhi) . . . 91
Deduction of tax at source --Payment received under holiday home scheme--Exempt in employee’s hands only if, in fact, used towards hotel boarding and lodging facilities for holidays--Amounts not spent towards holiday home scheme would constitute employee’s taxable income--Assessee making payment of fringe benefits tax on payments--No default for failure to deduct tax at source--Conveyance maintenance reimbursement expenditure--Assessee paying fringe benefits tax--Failure to deduct tax at source not default--Income-tax Act, 1961, ss. 10(14), 17(1)(iv), 115WB, 201(1), (1A)--Income-tax Rules, 1962, r. 3(7)(ii)-- CIT (TDS) v. Oil and Natural Gas Corporation (India) Ltd. (Guj) . . . 131
Depreciation --Actual cost--Goods imported without customs duty on basis of exemption certificate--Demand for duty in later year--Duty paid and capitalised in that year--Depreciation allowable on additional cost--Income-tax Act, 1961-- CIT v. Orient Ceramics and Industries Ltd. (Delhi) . . . 49
----Rate of depreciation--Computer accessories and peripherals--Are an integral part of computer system--Entitled to higher rate of depreciation of 60 per cent.--Income-tax Act, 1961, s. 32-- CIT v. BSES Yamuna Powers Ltd. (Delhi) . . . 47
----Rate of depreciation--Uninterrupted power supply system (UPS)--Entitled to higher rate of depreciation of 60 per cent.--Income-tax Act, 1961, s. 32-- CIT v. Orient Ceramics and Industries Ltd. (Delhi) . . . 49
Exemption --Charitable institution notified by Central Government--Meaning of charitable institution--Statutory authority set up as regulatory body--Charitable institution--Fees charged by such authority--Entitled to exemption--Income-tax Act, 1961, ss. 2(15), 10(23C)(iv)-- Bureau of Indian Standards v. Director General of Income-tax (Exemptions) (Delhi) . . . 78
Export --Special deduction--Export of computer software--Effect of introduction of section 80HHE with effect from 1-4-1991--Income from export of computer software in accounting year relevant to assessment years 1993-94 and 1994-95--Special deduction could be claimed only under section 80HHE--Alternate claim could not be made under section 80-O--Income-tax Act, 1961, ss. 80HHE, 80-O-- CIT v. B. T. System and Service Ltd. (Mad) . . . 30
Industrial undertaking --Special deduction under section 80-IA --Condition precedent--Manufacture or production of article--Meaning of manufacture--Processing resulting in commercially distinct product amounts to production--Coating of titanium substrates with chemicals amounts to manufacture--Assessee entitled to special deduction under section 80-IA--Income-tax Act, 1961, s. 80-IA-- Titanor Components Ltd. v. CIT (Delhi) . . . 55
Interpretation of taxing statutes --Special provision excludes general provision-- CIT v. B. T. System and Service Ltd. (Mad) . . . 30
Reassessment --Notice after four years--Validity--Failure to disclose material facts necessary for assessment--Duty of assessee to disclose facts fully and truly--Failure to disclose facts regarding particular transactions--Notice valid--Income-tax Act, 1961, ss. 147, 148-- OPG Metals and Finsec Ltd. v. CIT (Delhi) . . . 144
Rebate --Company--Book profit--Computation of income under section 115JB--Section 88E applies to income computed under section 115JB--Assessee entitled to rebate of securities transaction tax which has been paid--Income-tax Act, 1961, ss. 88E, 115JB-- CIT v. MBL and Co. Ltd. (Delhi) . . . 1
Return --Delay in filing return--Condonation of delay--Assessee required to obtain statutory audit report--Statutory auditor submitting two reports--Delay in filing revised return after final audit report to be condoned--Income-tax Act, 1961, s. 119-- Mahalakshmi Co-operative Bank Ltd. v. CBDT (Karn) . . . 23
Search and seizure --Assessment--Limitation--Exclusion of period during which assessment stayed by court--Limitation resumes on date of vacation of stay--Not from date of receipt of order by Department--Assessment barred by limitation--Income-tax Act, 1961, s. 158BC-- CIT v. Drs. X-Ray and Pathology Institute Pvt. Ltd. (All) . . . 27
SECTIONWISE INDEX TO CASES REPORTED IN THIS PART
S. 2(15) --Charitable purposes--Charitable trust--Business carried on by charitable trust--Meaning of “business†in section 2(15)--Institute of Chartered Accountants of India established to regulate profession of chartered accountants in India--Institute imparting education--Coaching classes conducted by Institute not like private coaching classes--Activity ancillary to educational purposes--Fees charged for coaching classes--Not conclusive--Institute entitled to exemption under section 11-- Institute of Chartered Accountants of India v. Director-General of Income-tax (Exemptions) (Delhi) . . . 91
----Exemption--Charitable institution notified by Central Government--Meaning of charitable institution--Statutory authority set up as regulatory body--Charitable institution--Fees charged by such authority--Entitled to exemption-- Bureau of Indian Standards v. Director General of Income-tax (Exemptions) (Delhi) . . . 78
S. 2(24)(iv) --Appeal to Appellate Tribunal--Powers of Tribunal--Power to remand--Individuals working in various inter-connected organizations--Commission paid by one organization--No return filed by any of the individuals--Order of remand to determine assessability of commission--Justified-- CIT v. C. S. Srivatsan (Mad) . . . 10
S. 2(24)(x) --Business expenditure--Deduction only on actual payment--Contributions of employees’ State insurance and provident fund deposited prior to filing return under section 139(1)--Allowable-- CIT v. Mark Auto Industries Ltd. (P&H) . . . 43
S. 9(1)(vii) --Business expenditure--Disallowance--Payments to non-resident--Failure to deduct tax at source--Circulars in force during relevant year not obliging assessee to deduct tax at source--Circular withdrawing earlier circulars operative only from date of issue and not applicable for earlier years--Circulars binding upon Department--No obligation to deduct tax at source on commission paid to non-resident who was not liable to pay tax in India--Expenditure allowable-- CIT v. Model Exims (All) . . . 72
S. 10(14) --Deduction of tax at source--Payment received under holiday home scheme--Exempt in employee’s hands only if, in fact, used towards hotel boarding and lodging facilities for holidays--Amounts not spent towards holiday home scheme would constitute employee’s taxable income--Assessee making payment of fringe benefits tax on payments--No default for failure to deduct tax at source--Conveyance maintenance reimbursement expenditure--Assessee paying fringe benefits tax--Failure to deduct tax at source not default-- CIT (TDS) v. Oil and Natural Gas Corporation (India) Ltd. (Guj) . . . 131
S. 10(23C)(iv) --Exemption--Charitable institution notified by Central Government--Meaning of charitable institution--Statutory authority set up as regulatory body--Charitable institution--Fees charged by such authority--Entitled to exemption-- Bureau of Indian Standards v. Director General of Income-tax (Exemptions) (Delhi) . . . 78
S. 11 --Charitable purposes--Charitable trust--Business carried on by charitable trust--Meaning of “business†in section 2(15)--Institute of Chartered Accountants of India established to regulate profession of chartered accountants in India--Institute imparting education--Coaching classes conducted by Institute not like private coaching classes--Activity ancillary to educational purposes--Fees charged for coaching classes--Not conclusive--Institute entitled to exemption under section 11-- Institute of Chartered Accountants of India v. Director-General of Income-tax (Exemptions) (Delhi) . . . 91
----Charitable purposes--Charitable trust--Investment of funds of charitable trust--Institute established for regulating profession of chartered accountants in India--Funds of Institute provided to ICAI Accounting Research Foundation--No violation of provisions of section 13--Institute entitled to exemption under section 11-- Institute of Chartered Accountants of India v. Director-General of Income-tax (Exemptions) (Delhi) . . . 91
S. 13 --Charitable purposes--Charitable trust--Investment of funds of charitable trust--Institute established for regulating profession of chartered accountants in India--Funds of Institute provided to ICAI Accounting Research Foundation--No violation of provisions of section 13--Institute entitled to exemption under section 11-- Institute of Chartered Accountants of India v. Director-General of Income-tax (Exemptions) (Delhi) . . . 91
S. 17(1)(iv) --Deduction of tax at source--Payment received under holiday home scheme--Exempt in employee’s hands only if, in fact, used towards hotel boarding and lodging facilities for holidays--Amounts not spent towards holiday home scheme would constitute employee’s taxable income--Assessee making payment of fringe benefits tax on payments--No default for failure to deduct tax at source--Conveyance maintenance reimbursement expenditure--Assessee paying fringe benefits tax--Failure to deduct tax at source not default-- CIT (TDS) v. Oil and Natural Gas Corporation (India) Ltd. (Guj) . . . 131
S. 32 --Business expenditure--Disallowance--Expenditure on technical know-how--Expenditure capitalised and not claimed as revenue expenditure--Provision for disallowance for failure to deduct tax at source not applicable-- CIT v. Mark Auto Industries Ltd. (P&H) . . . 43
----Depreciation--Rate of depreciation--Computer accessories and peripherals--Are an integral part of computer system--Entitled to higher rate of depreciation of 60 per cent.-- CIT v. BSES Yamuna Powers Ltd. (Delhi) . . . 47
----Depreciation--Rate of depreciation--Uninterrupted power supply system (UPS)--Entitled to higher rate of depreciation of 60 per cent.-- CIT v. Orient Ceramics and Industries Ltd. (Delhi) . . . 49
S. 35AB --Business expenditure--Disallowance--Expenditure on technical know-how--Expenditure capitalised and not claimed as revenue expenditure--Provision for disallowance for failure to deduct tax at source not applicable-- CIT v. Mark Auto Industries Ltd. (P&H) . . . 43
S. 36(1)(va) --Business expenditure--Deduction only on actual payment--Contributions of employees’ State insurance and provident fund deposited prior to filing return under section 139(1)--Allowable-- CIT v. Mark Auto Industries Ltd. (P&H) . . . 43
S. 37 --Capital or revenue expenditure--Expenditure on glow-sign boards displayed at dealer outlets--Revenue-- CIT v. Orient Ceramics and Industries Ltd. (Delhi) . . . 49
S. 40(a)(i) --Business expenditure--Disallowance--Expenditure on technical know-how--Expenditure capitalised and not claimed as revenue expenditure--Provision for disallowance for failure to deduct tax at source not applicable-- CIT v. Mark Auto Industries Ltd. (P&H) . . . 43
S. 40(a)(ia) --Business expenditure--Disallowance--Payments to non-resident--Failure to deduct tax at source--Circulars in force during relevant year not obliging assessee to deduct tax at source--Circular withdrawing earlier circulars operative only from date of issue and not applicable for earlier years--Circulars binding upon Department--No obligation to deduct tax at source on commission paid to non-resident who was not liable to pay tax in India--Expenditure allowable-- CIT v. Model Exims (All) . . . 72
S. 43B --Business expenditure--Deduction only on actual payment--Contributions of employees’ State insurance and provident fund deposited prior to filing return under section 139(1)--Allowable-- CIT v. Mark Auto Industries Ltd. (P&H) . . . 43
S. 80HH --Reassessment--Limitation--Notice after four years--Special deduction--Industrial undertaking--Assessment completed on basis of decision of High Court allowing deduction for civil construction--Cannot be reopened after four years solely on basis of subsequent reversal of High Court by Supreme Court-- Deputy CIT v. Simplex Concrete Piles (India) Ltd. (SC) . . . 129
S. 80HHE --Export--Special deduction--Export of computer software--Effect of introduction of section 80HHE with effect from 1-4-1991--Income from export of computer software in accounting year relevant to assessment years 1993-94 and 1994-95--Special deduction could be claimed only under section 80HHE--Alternate claim could not be made under section 80-O-- CIT v. B. T. System and Service Ltd. (Mad) . . . 30
S. 80-IA --Industrial undertaking--Special deduction under section 80-IA--Condition precedent--Manufacture or production of article--Meaning of manufacture--Processing resulting in commercially distinct product amounts to production--Coating of titanium substrates with chemicals amounts to manufacture--Assessee entitled to special deduction under section 80-IA-- Titanor Components Ltd. v. CIT (Delhi) . . . 55
S. 80-O --Export--Special deduction--Export of computer software--Effect of introduction of section 80HHE with effect from 1-4-1991--Income from export of computer software in accounting year relevant to assessment years 1993-94 and 1994-95--Special deduction could be claimed only under section 80HHE--Alternate claim could not be made under section 80-O-- CIT v. B. T. System and Service Ltd. (Mad) . . . 30
S. 88E --Rebate--Company--Book profit--Computation of income under section 115JB--Section 88E applies to income computed under section 115JB--Assessee entitled to rebate of securities transaction tax which has been paid-- CIT v. MBL and Co. Ltd. (Delhi) . . . 1
S. 115JB --Rebate--Company--Book profit--Computation of income under section 115JB--Section 88E applies to income computed under section 115JB--Assessee entitled to rebate of securities transaction tax which has been paid-- CIT v. MBL and Co. Ltd. (Delhi) . . . 1
S. 115WB --Deduction of tax at source--Payment received under holiday home scheme--Exempt in employee’s hands only if, in fact, used towards hotel boarding and lodging facilities for holidays--Amounts not spent towards holiday home scheme would constitute employee’s taxable income--Assessee making payment of fringe benefits tax on payments--No default for failure to deduct tax at source--Conveyance maintenance reimbursement expenditure--Assessee paying fringe benefits tax--Failure to deduct tax at source not default-- CIT (TDS) v. Oil and Natural Gas Corporation (India) Ltd. (Guj) . . . 131
S. 119 --Return--Delay in filing return--Condonation of delay--Assessee required to obtain statutory audit report--Statutory auditor submitting two reports--Delay in filing revised return after final audit report to be condoned-- Mahalakshmi Co-operative Bank Ltd. v. CBDT (Karn) . . . 23
S. 139(1) --Business expenditure--Deduction only on actual payment--Contributions of employees’ State insurance and provident fund deposited prior to filing return under section 139(1)--Allowable-- CIT v. Mark Auto Industries Ltd. (P&H) . . . 43
S. 147 --Reassessment--Limitation--Notice after four years--Special deduction--Industrial undertaking--Assessment completed on basis of decision of High Court allowing deduction for civil construction--Cannot be reopened after four years solely on basis of subsequent reversal of High Court by Supreme Court-- Deputy CIT v. Simplex Concrete Piles (India) Ltd. (SC) . . . 129
----Reassessment--Notice after four years--Validity--Failure to disclose material facts necessary for assessment--Duty of assessee to disclose facts fully and truly--Failure to disclose facts regarding particular transactions--Notice valid-- OPG Metals and Finsec Ltd. v. CIT (Delhi) . . . 144
S. 148 --Reassessment--Notice after four years--Validity--Failure to disclose material facts necessary for assessment--Duty of assessee to disclose facts fully and truly--Failure to disclose facts regarding particular transactions--Notice valid-- OPG Metals and Finsec Ltd. v. CIT (Delhi) . . . 144
S. 149(1)(a) --Reassessment--Limitation--Notice after four years--Special deduction--Industrial undertaking--Assessment completed on basis of decision of High Court allowing deduction for civil construction--Cannot be reopened after four years solely on basis of subsequent reversal of High Court by Supreme Court-- Deputy CIT v. Simplex Concrete Piles (India) Ltd. (SC) . . . 129
S. 158BC --Search and seizure--Assessment--Limitation--Exclusion of period during which assessment stayed by court--Limitation resumes on date of vacation of stay--Not from date of receipt of order by Department--Assessment barred by limitation-- CIT v. Drs. X-Ray and Pathology Institute Pvt. Ltd. (All) . . . 27
S. 195 --Business expenditure--Disallowance--Payments to non-resident--Failure to deduct tax at source--Circulars in force during relevant year not obliging assessee to deduct tax at source--Circular withdrawing earlier circulars operative only from date of issue and not applicable for earlier years--Circulars binding upon Department--No obligation to deduct tax at source on commission paid to non-resident who was not liable to pay tax in India--Expenditure allowable-- CIT v. Model Exims (All) . . . 72
S. 201(1), (1A) --Deduction of tax at source--Payment received under holiday home scheme--Exempt in employee’s hands only if, in fact, used towards hotel boarding and lodging facilities for holidays--Amounts not spent towards holiday home scheme would constitute employee’s taxable income--Assessee making payment of fringe benefits tax on payments--No default for failure to deduct tax at source--Conveyance maintenance reimbursement expenditure--Assessee paying fringe benefits tax--Failure to deduct tax at source not default-- CIT (TDS) v. Oil and Natural Gas Corporation (India) Ltd. (Guj) . . . 131
R. 3(7)(ii) --Deduction of tax at source--Payment received under holiday home scheme--Exempt in employee’s hands only if, in fact, used towards hotel boarding and lodging facilities for holidays--Amounts not spent towards holiday home scheme would constitute employee’s taxable income--Assessee making payment of fringe benefits tax on payments--No default for failure to deduct tax at source--Conveyance maintenance reimbursement expenditure--Assessee paying fringe benefits tax--Failure to deduct tax at source not default-- CIT (TDS) v. Oil and Natural Gas Corporation (India) Ltd. (Guj) . . . 131
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