ITR'S TRIBUNAL TAX REPORTS (ITR (TRIB))--PRINT AND ONLINE EDITION
SUBJECT INDEX TO CASES REPORTED
Capital gains --Sale of shares--Shares allotted by Bombay Stock Exchange in lieu of its membership card in scheme of demutualisation--Capital gain on sale of shares to be computed by taking original cost of acquisition of membership card and allowing indexation in accordance with law--Income-tax Act, 1961, s. 55(2)(ab)-- Deputy CIT v. G. Das Capital Markets P. Ltd. (Mumbai) . . . 94
Capital loss --Sale of shares--Sale of shares to relatives of directors of assessee--Actual price of shares on date of sale required for determining profit or loss--Value of share to be determined in accordance with net asset value--Assessing Officer to determine value of share--Matter remanded--Income-tax Act, 1961-- Deputy CIT v. G. Das Capital Markets P. Ltd. (Mumbai) . . . 94
Cash credits --Assessee purchasing teleserials selling portion during current year and disclosing balance as its closing stock--Reasoning given by Assessing Officer for rejecting books of accounts of assessee that supplier company’s accounts not reliable not proper--Rejection of accounts not justified--Sales amount cannot be treated as unexplained cash credit--Assessing Officer to examine books of accounts of assessee and to determine business income--Income-tax Act, 1961, s. 68-- Wellness Communication P. Ltd. v. ITO(Mumbai) . . . 86
Scientific research expenditure --Capital or revenue expenditure--Expenditure incurred for developing prototypes of products for specific customers according to their specifications--No orders can be expected if prototype developed not conform to samples supplied by customer and would constitute loss--Assessee in same business for more than two decades--Expenditure revenue in nature and eligible for deduction--Income-tax Act, 1961, s. 35-- Asst. CIT v. Besson Musical Instrument P. Ltd. (Delhi) . . . 90
Volume 37 : Part 5 (Issue dated : 2-2-2015)
SUBJECT INDEX TO CASES REPORTED
Appeal to Appellate Tribunal --Monetary limits for appeals by Department--Instruction No. 5 of 2014, dated July 10, 2014 revising monetary limits--Applicable to pending appeals--Failure by Department to point out exceptions provided in Circular--Appeal not maintainable--CBDT Instruction No. 5 of 2014, dated July 10, 2014--Income-tax Act, 1961-- ITO v. Santo Stores(Kolkata) . . . 665
Appeal to Commissioner (Appeals) --Charitable purpose--Exemption--Commissioner (Appeals) directing Assessing Officer to consider agricultural income for rate purpose--Not entitled to remit issue for further investigation-- Deputy CIT v. R. N. Shetty Trust (Bangalore) . . . 584
Best judgment assessment --Rejection of accounts and assessment under section 144--Estimation of profit--Transport business--Estimation of income at 5 per cent. reasonable--Income-tax Act, 1961, s. 144-- Sahani Transport Corporation v. Deputy CIT (Cuttack) . . . 564
Business expenditure --Deduction only on actual payment--Employer’s contribution to employees provident fund paid before due date for filing return--Allowable--Income-tax Act, 1961, s. 43B-- Deputy CIT v. Selvel Advertising P. Ltd. (Kolkata) . . . 611
----Depreciation--LED video display boards--Are temporary structures--Assessee entitled to 100 per cent. depreciation--Income-tax Act, 1961-- Deputy CIT v. Selvel Advertising P. Ltd.(Kolkata) . . . 611
----Prior period expenses--Expenses relating to earlier years--Assessee producing details of expenses debited in profit and loss account and receipt of bills in respective assessment years--Disallowance to be deleted--Income-tax Act, 1961-- Deputy CIT v. Selvel Advertising P. Ltd. (Kolkata) . . . 611
----Provision for bad and doubtful debts--Amount not to exceed 10 per cent. of aggregate average advances for deduction--Allowable to extent of provision actually created in books of account or amount calculated in terms of section 36(1)(viia) whichever is lower--Income-tax Act, 1961, s. 36(1)(viia)-- Nanded District Central Co-operative Bank Ltd. v. Deputy CIT(Pune) . . . 532
Cash credit --Estimation of income at figure higher than cash credit--No details of sundry creditors--No finding of other source of income earned by assessee--No separate addition for sundry creditors warranted--Income-tax Act, 1961, s. 68-- Sahani Transport Corporation v. Deputy CIT (Cuttack) . . . 564
Charitable purpose --Exemption--Investment in non-specified assets constituting only 1.68 per cent. of total assets--Miniscule investment--Not sufficient to deny exemption--Assessee not maintaining separate books of account for agricultural activities--Failure by Assessing Officer to call for record of Revenue authorities or bring material to show income not from agricultural activities--Exemption cannot be denied--Cash credit--Corpus donations--Assessee giving list of donors for substantial amount--Failure by Assessing Officer to collect confirmation regarding donations--Exemption cannot be denied--Payment of money to sister concerns--No material to demonstrate payment not commensurate with market value of services availed of--No violation of section 13(1)(c) and (3)--Exemption cannot be denied--Trust running educational institutions--Income incidental to main activity--Exemption cannot be denied--Income-tax Act, 1961, ss. 11, 11(5), 12, 13, 68-- Deputy CIT v. R. N. Shetty Trust(Bangalore) . . . 584
Depreciation --Additional depreciation--Assessing Officer allowing additional depreciation in immediately preceding assessment year--Denial of remaining fifty per cent. of additional depreciation for next assessment year holding that business of generation and distribution of power not eligible for additional depreciation--Once conditions regarding claim of depreciation examined in first year cannot be denied in next assessment year--Assessee entitled for balance unutilised fifty per cent. of additional depreciation--Income-tax Act, 1961, s. 32(1)(iia)-- Century Enka Ltd. v. Deputy CIT (Kolkata) . . . 644
----Assessee acquiring commercial rights to display on bridges for business purposes--Entitled to depreciation--Income-tax Act, 1961-- Deputy CIT v. Selvel Advertising P. Ltd.(Kolkata) . . . 611
Income --Accrual--Co-operative bank--Mercantile system of accounting--Interest relating to non-performing assets advances--Interest does not accrue to assessee--Not taxable--Income-tax Act, 1961, s. 43D-- Nanded District Central Co-operative Bank Ltd. v. Deputy CIT (Pune) . . . 532
----Disallowance of expenditure in relation to exempt income--Object of assessee in making investment to gain holding controlling stake in group concerns and not for earning income--Provisions of section 14A cannot be invoked--Income-tax Act, 1961, s. 14A--Income-tax Rules, 1962, r. 8D-- Deputy CIT v. Selvel Advertising P. Ltd. (Kolkata) . . . 611
Income from undisclosed sources --Addition on account of bogus purchases--Assessee furnishing proof to substantiate purchases--Addition to be deleted--Income-tax Act, 1961--Deputy CIT v. Selvel Advertising P. Ltd. (Kolkata) . . . 611
Income or capital --Co-operative bank--Negative networth--Financial assistance rendered by State Government with object of safeguarding interest of farmers and depositors and regularising normal banking activity--Transaction between Government and assessee cannot be regarded as business activity--Financial assistance capital in nature not chargeable to tax--Income-tax Act, 1961-- Nanded District Central Co-operative Bank Ltd. v. Deputy CIT(Pune) . . . 532
Infrastructure facility --Special deduction under section 80-IA(5)--Condition precedent--Deduction cannot be denied in succeeding years without disturbing relief granted for initial year--Income-tax Act, 1961, s. 80-IA(5)-- Deputy CIT v. Selvel Advertising P. Ltd. (Kolkata) . . . 611
Penalty --Concealment of income or furnishing of inaccurate particulars--Long-term capital gains--Rate of tax--Assessee claiming 10 per cent rate of tax in first revised return and 20 per cent. in second for sale of paintings--Assessing Officer rejecting second revised return on ground of lapse of time--No attempt by assessee to show long-term capital gains in a different category--Assessee cannot be held guilty of concealment of income merely for seeking to be taxed at concessional rate by mistake--Deletion of penalty justified--Income-tax Act, 1961, s. 271(1)(c)-- Asst. CIT v. Smt. Cecilia Haresh Chaganlal (Mumbai) . . . 567
----Search and seizure--Assessee cannot be expected to further substantiate manner of earning of income if no questioning done under section 132(4)--Penalty cannot be levied--Income-tax Act, 1961, ss. 132(4), 271AAA-- Sunil Kumar Bansal v. Deputy CIT (Chandigarh) . . . 576
SECTIONWISE INDEX TO CASES REPORTED IN THIS PART
S. 11 --Charitable purpose--Exemption--Investment in non-specified assets constituting only 1.68 per cent. of total assets--Miniscule investment--Not sufficient to deny exemption--Assessee not maintaining separate books of account for agricultural activities--Failure by Assessing Officer to call for record of Revenue authorities or bring material to show income not from agricultural activities--Exemption cannot be denied--Cash credit--Corpus donations--Assessee giving list of donors for substantial amount--Failure by Assessing Officer to collect confirmation regarding donations--Exemption cannot be denied--Payment of money to sister concerns--No material to demonstrate payment not commensurate with market value of services availed of--No violation of section 13(1)(c) and (3)--Exemption cannot be denied--Trust running educational institutions--Income incidental to main activity--Exemption cannot be denied-- Deputy CIT v. R. N. Shetty Trust (Bangalore) . . . 584
S. 11(5) --Charitable purpose--Exemption--Investment in non-specified assets constituting only 1.68 per cent. of total assets--Miniscule investment--Not sufficient to deny exemption--Assessee not maintaining separate books of account for agricultural activities--Failure by Assessing Officer to call for record of Revenue authorities or bring material to show income not from agricultural activities--Exemption cannot be denied--Cash credit--Corpus donations--Assessee giving list of donors for substantial amount--Failure by Assessing Officer to collect confirmation regarding donations--Exemption cannot be denied--Payment of money to sister concerns--No material to demonstrate payment not commensurate with market value of services availed of--No violation of section 13(1)(c) and (3)--Exemption cannot be denied--Trust running educational institutions--Income incidental to main activity--Exemption cannot be denied-- Deputy CIT v. R. N. Shetty Trust (Bangalore) . . . 584
S. 12 --Charitable purpose--Exemption--Investment in non-specified assets constituting only 1.68 per cent. of total assets--Miniscule investment--Not sufficient to deny exemption--Assessee not maintaining separate books of account for agricultural activities--Failure by Assessing Officer to call for record of Revenue authorities or bring material to show income not from agricultural activities--Exemption cannot be denied--Cash credit--Corpus donations--Assessee giving list of donors for substantial amount--Failure by Assessing Officer to collect confirmation regarding donations--Exemption cannot be denied--Payment of money to sister concerns--No material to demonstrate payment not commensurate with market value of services availed of--No violation of section 13(1)(c) and (3)--Exemption cannot be denied--Trust running educational institutions--Income incidental to main activity--Exemption cannot be denied-- Deputy CIT v. R. N. Shetty Trust (Bangalore) . . . 584
S. 13 --Charitable purpose--Exemption--Investment in non-specified assets constituting only 1.68 per cent. of total assets--Miniscule investment--Not sufficient to deny exemption--Assessee not maintaining separate books of account for agricultural activities--Failure by Assessing Officer to call for record of Revenue authorities or bring material to show income not from agricultural activities--Exemption cannot be denied--Cash credit--Corpus donations--Assessee giving list of donors for substantial amount--Failure by Assessing Officer to collect confirmation regarding donations--Exemption cannot be denied--Payment of money to sister concerns--No material to demonstrate payment not commensurate with market value of services availed of--No violation of section 13(1)(c) and (3)--Exemption cannot be denied--Trust running educational institutions--Income incidental to main activity--Exemption cannot be denied-- Deputy CIT v. R. N. Shetty Trust (Bangalore) . . . 584
S. 14A --Income--Disallowance of expenditure in relation to exempt income--Object of assessee in making investment to gain holding controlling stake in group concerns and not for earning income--Provisions of section 14A cannot be invoked-- Deputy CIT v. Selvel Advertising P. Ltd. (Kolkata) . . . 611
S. 32(1)(iia) --Depreciation--Additional depreciation--Assessing Officer allowing additional depreciation in immediately preceding assessment year--Denial of remaining fifty per cent. of additional depreciation for next assessment year holding that business of generation and distribution of power not eligible for additional depreciation--Once conditions regarding claim of depreciation examined in first year cannot be denied in next assessment year--Assessee entitled for balance unutilised fifty per cent. of additional depreciation-- Century Enka Ltd. v. Deputy CIT (Kolkata) . . . 644
S. 36(1)(viia) --Business expenditure--Provision for bad and doubtful debts--Amount not to exceed 10 per cent. of aggregate average advances for deduction--Allowable to extent of provision actually created in books of account or amount calculated in terms of section 36(1)(viia) whichever is lower-- Nanded District Central Co-operative Bank Ltd. v. Deputy CIT(Pune) . . . 532
S. 43B --Business expenditure--Deduction only on actual payment--Employer’s contribution to employees provident fund paid before due date for filing return--Allowable--Deputy CIT v. Selvel Advertising P. Ltd. (Kolkata) . . . 611
S. 43D --Income--Accrual--Co-operative bank--Mercantile system of accounting--Interest relating to non-performing assets advances--Interest does not accrue to assessee--Not taxable-- Nanded District Central Co-operative Bank Ltd. v. Deputy CIT (Pune) . . . 532
S. 68 --Cash credit--Estimation of income at figure higher than cash credit--No details of sundry creditors--No finding of other source of income earned by assessee--No separate addition for sundry creditors warranted-- Sahani Transport Corporation v. Deputy CIT(Cuttack) . . . 564
----Charitable purpose--Exemption--Investment in non-specified assets constituting only 1.68 per cent. of total assets--Miniscule investment--Not sufficient to deny exemption--Assessee not maintaining separate books of account for agricultural activities--Failure by Assessing Officer to call for record of Revenue authorities or bring material to show income not from agricultural activities--Exemption cannot be denied--Cash credit--Corpus donations--Assessee giving list of donors for substantial amount--Failure by Assessing Officer to collect confirmation regarding donations--Exemption cannot be denied--Payment of money to sister concerns--No material to demonstrate payment not commensurate with market value of services availed of--No violation of section 13(1)(c) and (3)--Exemption cannot be denied--Trust running educational institutions--Income incidental to main activity--Exemption cannot be denied-- Deputy CIT v. R. N. Shetty Trust (Bangalore) . . . 584
S. 80-IA(5) --Infrastructure facility--Special deduction under section 80-IA(5)--Condition precedent--Deduction cannot be denied in succeeding years without disturbing relief granted for initial year-- Deputy CIT v. Selvel Advertising P. Ltd. (Kolkata) . . . 611
S. 132(4) --Penalty--Search and seizure--Assessee cannot be expected to further substantiate manner of earning of income if no questioning done under section 132(4)--Penalty cannot be levied-- Sunil Kumar Bansal v. Deputy CIT (Chandigarh) . . . 576
S. 144 --Best judgment assessment--Rejection of accounts and assessment under section 144--Estimation of profit--Transport business--Estimation of income at 5 per cent. reasonable-- Sahani Transport Corporation v. Deputy CIT (Cuttack) . . . 564
S. 271(1)(c) --Penalty--Concealment of income or furnishing of inaccurate particulars--Long-term capital gains--Rate of tax--Assessee claiming 10 per cent rate of tax in first revised return and 20 per cent. in second for sale of paintings--Assessing Officer rejecting second revised return on ground of lapse of time--No attempt by assessee to show long-term capital gains in a different category--Assessee cannot be held guilty of concealment of income merely for seeking to be taxed at concessional rate by mistake--Deletion of penalty justified--Asst. CIT v. Smt. Cecilia Haresh Chaganlal (Mumbai) . . . 567
S. 271AAA --Penalty--Search and seizure--Assessee cannot be expected to further substantiate manner of earning of income if no questioning done under section 132(4)--Penalty cannot be levied-- Sunil Kumar Bansal v. Deputy CIT (Chandigarh) . . . 576
R. 8D --Income--Disallowance of expenditure in relation to exempt income--Object of assessee in making investment to gain holding controlling stake in group concerns and not for earning income--Provisions of section 14A cannot be invoked-- Deputy CIT v. Selvel Advertising P. Ltd. (Kolkata) . . . 611
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