IEC code can now be applied with only Two Documents

IEC code can now be applied with only Two Documents

(TO BE PUBLISHED IN THE GAZETTE OF INDIA EXTRAORDINARY PART-II, SECTION – 3, SUB-SECTION (II))

GOVERNMENT OF INDIA
MINISTRY OF COMMERCE AND INDUSTRY
DEPARTMENT OF COMMERCE
DIRECTORATE GENERAL OF FOREIGN TRADE
NEW DELHI

NOTIFICATION NO. 34/2015-20, Dated: January 29, 2016

Subject: Amendment in para 2.05 (c) of Foreign Trade Policy (2015-20)

In exercise of powers conferred by Section 3 of FT (D&R) Act, 1992, read with paragraph 1.02 and 2.01 of the Foreign Trade Policy, 2015-2020, as amended from time to time, the Central Government hereby amends the existing para 2.05 (c) of Foreign Trade Policy(2015-20) and introduces a new provision, part (d) under para 2.05. The existing para reads as under:

2.05 Importer-Exporter Code (IEC)

(c) Briefly, following are the requisite details /documents (scanned copies) to be submitted/ uploaded along with the application for IEC:

(i) Details of the entity seeking the IEC:

(1) PAN of the business entity in whose name Import/Export would be done (Applicant individual in case of Proprietorship firms).

(2) Address Proof of the applicant entity.

(3) LLPIN /CIN/ Registration Certification Number (whichever is applicable).

(4) Bank account details of the entity. Cancelled cheque bearing entity's preprinted name or Bank certificate in prescribed format ANF-2A (I).

(ii) Details of the Proprietor/ Partners/ Directors/ Secretary or Chief Executive of the Society/ Managing Trustee of the entity:

(1) PAN (for all categories)

(2) DIN/DPIN (in case of Company /LLP firm)

(iii) Details of the signatory applicant:

(1) Identity proof

(2) PAN

(3) Digital photograph

2. After amendment para 2.05 (c) would read as under:

2.05 Importer-Exporter Code (IEC)

(c) Only the following are required to be uploaded along with the application for IEC with immediate effect:

(1) Digital photograph of the signatory applicant;

(2) Copy of the PAN card of the business entity in whose name Import/Export would be done (Applicant individual in case of Proprietorship firms);

(3) Cancelled cheque bearing entity's pre-printed name or Bank certificate in prescribed format ANF-2A(I)

3. The new insertion, part (d) under Para 2.05 would read as under:

(d) Only online application for IEC /modification in IEC can be made by applicants through digital signature (Class-II or Class-III) with effect from 1.4.2016.

4. Effect of this Notification: From the date of this notification only two documents are required to be uploaded /submitted along with the digital photograph while applying for IEC. Further, applications for IEC/ modification in IEC can be made only in online mode by applicants through digital signatures with effect from 1.4.2016.

[F.No.01/89/180/20/AM-13/PC-2 (B)]

(Anup Wadhawan)
Director General of Foreign Trade

-Regards
CA. C. V. PAWAR

ITR Volume 380 : Part 4 (Issue dated : 25-1-2016)

 

INCOME TAX REPORTS (ITR)--PRINT AND ONLINE EDITION

ONLINE EDITION

STATUTES AND NOTIFICATIONS

Notifications :

Income-tax Act, 1961 :

Notifications under section 35AC(1), Expln. clause (b) :

Eligible projects or schemes . . . 27

 

PRINT EDITION

ITR Volume 380 : Part 4 (Issue dated : 25-1-2016)

SUBJECT INDEX TO CASES REPORTED

SUPREME COURT

Deduction of tax at source --Penalty--Failure to deduct tax at source--Finding by Commissioner (Appeals) and Tribunal that tax and interest under section 201(1) and (1A) paid and no case made out for levy of penalty--No substantial question of law arises--Income-tax Act, 1961, s. 271C-- CIT v. Bank of Nova Scotia . . . 550

Settlement of cases --Change of law--Provision for abatement of proceedings where no order passed by cut-off date--To be read down--Abatement only where failure owing to reasons attributable to applicant--Order of High Court holding proceedings abated--Set aside and matter remanded to High Court for decision afresh on merits--Income-tax Act, 1961, s. 245HA(1)(iv), (3)-- CIT v. Rajendra Kumar Verma . . . 430

 

HIGH COURTS

Appeal to Appellate Tribunal --Power to rectify defects in order--Application under sections 154(1A) and 254(2) for rectification--Rejection of application under section 254(2) justified--Income-tax Act, 1961, s. 254-- Indus Finance Corporation Ltd. v. CIT (Mad) . . . 504

Capital gains --Meaning of "transfer"--Transfer includes extinguishment of rights in capital asset--Surrender of floor area ratio rights in land amounts to transfer--Income-tax Act, 1961, s. 2(47)-- CIT v. Dinesh D. Ranka (Karn) . . . 440

----Slump sale--Net worth of undertaking--Aggregate value of total assets--Definitions--Depreciable assets--Incorporation by reference of section 43(6)(c)(i)(C)--Effect--Clause (C) must be read as an integral part of clause (a) of Explanation 2 to section 50B--Actual cost to be reduced, inter alia, by depreciation as would have been allowable for years commencing on or after 1-4-1988--Depreciation actually allowed for these years not relevant--Aggregate value of total assets not to be taken at written down value of block of assets as existing--Income-tax Act, 1961, ss. 2(11), 32, 43(6)(c)(i)(C), 50B-- CIT v. Dharampal Satyapal (Delhi) . . . 527

Capital or revenue receipt --Money to be used in purchase of plant and machinery temporarily placed in fixed deposits--Inextricably linked with setting up of plant--Interest on fixed deposits--Capital receipt--Income-tax Act, 1961-- Principal CIT v. Facor Power Ltd.(Delhi) . . . 474

Deduction of tax at source --Interest--Insurance company--Death or injury--Compensation--Not a business transaction or a receipt of any charges on account of services rendered by any other party--Insurance company not required to deduct tax at source--Income-tax Act, 1961-- New India Assurance Co. Ltd. v. Sudesh Chawla (P&H) . . . 467

Depreciation --Additional depreciation--One-time benefit to encourage industrialisation--Half of twenty per cent. allowable where plant and machinery put to use after October 31, 2006 and before March 31, 2007--No restriction in claiming balance ten per cent. in next assessment year--Income-tax Act, 1961, s. 32(1)(iia)-- CIT (LTU) v. Rittal India Pvt. Ltd. (No. 2 ) (Karn) . . . 428

----Additional depreciation--One-time benefit to encourage industrialisation--Plant and machinery set up after October 31, 2006 and before March 31, 2007--Half of additional depreciation of twenty per cent. allowable--No restriction in claiming balance ten per cent. in next assessment year--Income-tax Act, 1961, s. 32(1)(iia)-- CIT v. Rittal India Pvt. Ltd. (No.1 ) (Karn) . . . 423

----Meaning of "owner"--Lease of land for ninety- nine years--Lessee constructing buildings on land and in full control of such buildings--Entitled to depreciation on buildings and on sanitary fittings installed in them--Income-tax Act, 1961, s. 32-- CIT v. Bharat Hotels Ltd.(Delhi) . . . 552

Income --Computation of income--Disallowance under section 14A--Appellate authorities finding ten per cent. of income earned could be apportioned towards expenses for earning dividend--Finding not perverse--Income-tax Rules, 1962, r. 8D--Income-tax Act, 1961, s. 14A-- CIT v. India Advantage Securities Ltd. (Bom) . . . 471

----Lease of land for ninety-nine years--Lessee constructing buildings on land--Spaces in buildings allotted to sub-lessees and interest-free deposits collected--Amount reflected in business income--No further addition could be made--Income-tax Act, 1961-- CIT v. Bharat Hotels Ltd. (Delhi) . . . 552

Income-tax --General principles--Estoppel against pursuing parallel proceedings before two different authorities for same relief-- Indus Finance Corporation Ltd. v. CIT (Mad) . . . 504

Industrial undertaking --Special deduction under section 80-IB --Year in which special deduction is available--Year of manufacture--Three machines manufactured by assessee shown in exhibition in January, 1995--All three machines sold to allied concerns--Not relevant--Manufacture started in accounting year 1994-95 relevant to assessment year 1995-96 not 1996-97--Income-tax Act, 1961, s. 80-IB-- ACE Manufacturing Systems Ltd. v.Addl. CIT (LTU) (Karn) . . . 432

International transactions --Arm’s length price--Effect of section 92CA--Amount in dispute exceeding five crores of rupees--Matter has to be referred to Transfer Pricing Officer--Income-tax Act, 1961, ss. 92CA, 144C-- Carrier Race Technologies Pvt. Ltd. v. ITO(Mad) . . . 483

Interpretation of statutes --Beneficial provision--Additional depreciation--To be construed reasonably and purposively-- CIT (LTU) v. Rittal India Pvt. Ltd. (No. 2 ) (Karn) . . . 428

Interpretation of taxing statutes --Additional depreciation--Beneficial legislation--Liberal construction-- CIT v. Rittal India Pvt. Ltd. (No. 1 ) (Karn) . . . 423

----Definition-- CIT v. Dinesh D. Ranka (Karn) . . . 440

----Incorporation of provision by reference-- CIT v. Dharampal Satyapal (Delhi) . . . 527

Penalty --Concealment of income--Furnishing inaccurate particulars of income--Discretionary power of Tribunal to set aside penalty--Foreign gifts--Factum of gifts mentioned in note in return--When explanation called for further particulars not furnished on account of sour relationship--Tribunal cancelling penalty--No substantial question of law--Income-tax Act, 1961, s. 271(1)(c)-- CIT v. Sunila Sharma (P&H) . . . 462

Precedent --Effect of decisions of Supreme Court in Podar Cement case and Mysore Minerals case-- CIT v. Bharat Hotels Ltd. (Delhi) . . . 552

Reassessment --Notice after four years--Condition precedent--Failure to disclose material facts necessary for assessment--Deductions granted in original assessment after enquiry--Reassessment proceedings after four years to withdraw deduction--No failure to disclose material facts necessary for assessment--Notice not valid--Income-tax Act, 1961, ss. 147, 148-- E-Infochips Ltd. v. Deputy CIT (Guj) . . . 449

----Notice after four years--Condition precedent--Failure to disclose material facts necessary for assessment--Treatment of unutilised Cenvat credit for valuing stock examined by Assessing Officer in original scrutiny assessment--Notice after four years to recompute value of stock--No failure to disclose material facts necessary for assessment--Notice not valid--Income-tax Act, 1961, ss. 147, 148-- Tirupati Foam Ltd. v. Deputy CIT (Guj) . . . 493

Rectification of mistakes --Effect of section 154(1A)--Power to rectify matter not considered in original order of rectification--Lease deed found to be bogus in search proceedings--Disallowance of depreciation in block assessment--Lease income assessed as income from financing transaction--No appeal against such assessment or disallowance of depreciation--Earlier application for rectification given up--Application under section 154(1A) to delete income from lease--Not valid--Income-tax Act, 1961, s. 154-- Indus Finance Corporation Ltd.v. CIT (Mad) . . . 504

 

SECTIONWISE INDEX TO CASES REPORTED IN THIS PART

Income-tax Act, 1961 :

S. 2(11) --Capital gains--Slump sale--Net worth of undertaking--Aggregate value of total assets--Definitions--Depreciable assets--Incorporation by reference of section 43(6)(c)(i)(C)--Effect--Clause (C) must be read as an integral part of clause (a) of Explanation 2 to section 50B--Actual cost to be reduced, inter alia, by depreciation as would have been allowable for years commencing on or after 1-4-1988--Depreciation actually allowed for these years not relevant--Aggregate value of total assets not to be taken at written down value of block of assets as existing-- CIT v. Dharampal Satyapal (Delhi) . . . 527

S. 2(47) --Capital gains--Meaning of "transfer"--Transfer includes extinguishment of rights in capital asset--Surrender of floor area ratio rights in land amounts to transfer-- CIT v. Dinesh D. Ranka (Karn) . . . 440

S. 14A --Income--Computation of income--Disallowance under section 14A--Appellate authorities finding ten per cent. of income earned could be apportioned towards expenses for earning dividend--Finding not perverse-- CIT v. India Advantage Securities Ltd. (Bom) . . . 471

S. 32 --Capital gains--Slump sale--Net worth of undertaking--Aggregate value of total assets--Definitions--Depreciable assets--Incorporation by reference of section 43(6)(c)(i)(C)--Effect--Clause (C) must be read as an integral part of clause (a) of Explanation 2 to section 50B--Actual cost to be reduced, inter alia, by depreciation as would have been allowable for years commencing on or after 1-4-1988--Depreciation actually allowed for these years not relevant--Aggregate value of total assets not to be taken at written down value of block of assets as existing-- CIT v. Dharampal Satyapal (Delhi) . . . 527

----Depreciation--Meaning of "owner"--Lease of land for ninety- nine years--Lessee constructing buildings on land and in full control of such buildings--Entitled to depreciation on buildings and on sanitary fittings installed in them-- CIT v. Bharat Hotels Ltd. (Delhi) . . . 552

S. 32(1)(iia) --Depreciation--Additional depreciation--One-time benefit to encourage industrialisation--Half of twenty per cent. allowable where plant and machinery put to use after October 31, 2006 and before March 31, 2007--No restriction in claiming balance ten per cent. in next assessment year-- CIT (LTU) v. Rittal India Pvt. Ltd. (No. 2 ) (Karn) . . . 428

----Depreciation--Additional depreciation--One-time benefit to encourage industrialisation--Plant and machinery set up after October 31, 2006 and before March 31, 2007--Half of additional depreciation of twenty per cent. allowable--No restriction in claiming balance ten per cent. in next assessment year-- CIT v. Rittal India Pvt. Ltd. (No. 1 ) (Karn) . . . 423

S. 43(6)(c)(i)(C) --Capital gains--Slump sale--Net worth of undertaking--Aggregate value of total assets--Definitions--Depreciable assets--Incorporation by reference of section 43(6)(c)(i)(C)--Effect--Clause (C) must be read as an integral part of clause (a) of Explanation 2 to section 50B--Actual cost to be reduced, inter alia, by depreciation as would have been allowable for years commencing on or after 1-4-1988--Depreciation actually allowed for these years not relevant--Aggregate value of total assets not to be taken at written down value of block of assets as existing-- CIT v. Dharampal Satyapal (Delhi) . . . 527

S. 50B --Capital gains--Slump sale--Net worth of undertaking--Aggregate value of total assets--Definitions--Depreciable assets--Incorporation by reference of section 43(6)(c)(i)(C)--Effect--Clause (C) must be read as an integral part of clause (a) of Explanation 2 to section 50B--Actual cost to be reduced, inter alia, by depreciation as would have been allowable for years commencing on or after 1-4-1988--Depreciation actually allowed for these years not relevant--Aggregate value of total assets not to be taken at written down value of block of assets as existing-- CIT v. Dharampal Satyapal (Delhi) . . . 527

S. 80-IB --Industrial undertaking--Special deduction under section 80-IB --Year in which special deduction is available--Year of manufacture--Three machines manufactured by assessee shown in exhibition in January, 1995--All three machines sold to allied concerns--Not relevant--Manufacture started in accounting year 1994-95 relevant to assessment year 1995-96 not 1996-97-- ACE Manufacturing Systems Ltd. v. Addl. CIT (LTU) (Karn) . . . 432

S. 92CA --International transactions--Arm’s length price--Effect of section 92CA--Amount in dispute exceeding five crores of rupees--Matter has to be referred to Transfer Pricing Officer-- Carrier Race Technologies Pvt. Ltd. v. ITO (Mad) . . . 483

S. 144C --International transactions--Arm’s length price--Effect of section 92CA--Amount in dispute exceeding five crores of rupees--Matter has to be referred to Transfer Pricing Officer-- Carrier Race Technologies Pvt. Ltd. v. ITO (Mad) . . . 483

S. 147 --Reassessment--Notice after four years--Condition precedent--Failure to disclose material facts necessary for assessment--Deductions granted in original assessment after enquiry--Reassessment proceedings after four years to withdraw deduction--No failure to disclose material facts necessary for assessment--Notice not valid-- E-Infochips Ltd. v.Deputy CIT (Guj) . . . 449

----Reassessment--Notice after four years--Condition precedent--Failure to disclose material facts necessary for assessment--Treatment of unutilised Cenvat credit for valuing stock examined by Assessing Officer in original scrutiny assessment--Notice after four years to recompute value of stock--No failure to disclose material facts necessary for assessment--Notice not valid-- Tirupati Foam Ltd. v. Deputy CIT (Guj) . . . 493

S. 148 --Reassessment--Notice after four years--Condition precedent--Failure to disclose material facts necessary for assessment--Deductions granted in original assessment after enquiry--Reassessment proceedings after four years to withdraw deduction--No failure to disclose material facts necessary for assessment--Notice not valid-- E-Infochips Ltd. v.Deputy CIT (Guj) . . . 449

----Reassessment--Notice after four years--Condition precedent--Failure to disclose material facts necessary for assessment--Treatment of unutilised Cenvat credit for valuing stock examined by Assessing Officer in original scrutiny assessment--Notice after four years to recompute value of stock--No failure to disclose material facts necessary for assessment--Notice not valid-- Tirupati Foam Ltd. v. Deputy CIT (Guj) . . . 493

S. 154 --Rectification of mistakes--Effect of section 154(1A)--Power to rectify matter not considered in original order of rectification--Lease deed found to be bogus in search proceedings--Disallowance of depreciation in block assessment--Lease income assessed as income from financing transaction--No appeal against such assessment or disallowance of depreciation--Earlier application for rectification given up--Application under section 154(1A) to delete income from lease--Not valid-- Indus Finance Corporation Ltd. v. CIT (Mad) . . . 504

S. 245HA(1)(iv), (3) --Settlement of cases--Change of law--Provision for abatement of proceedings where no order passed by cut-off date--To be read down--Abatement only where failure owing to reasons attributable to applicant--Order of High Court holding proceedings abated--Set aside and matter remanded to High Court for decision afresh on merits-- CIT v. Rajendra Kumar Verma(SC) . . . 430

S. 254 --Appeal to Appellate Tribunal--Power to rectify defects in order--Application under sections 154(1A) and 254(2) for rectification--Rejection of application under section 254(2) justified-- Indus Finance Corporation Ltd. v. CIT (Mad) . . . 504

S. 271(1)(c) --Penalty--Concealment of income--Furnishing inaccurate particulars of income--Discretionary power of Tribunal to set aside penalty--Foreign gifts--Factum of gifts mentioned in note in return--When explanation called for further particulars not furnished on account of sour relationship--Tribunal cancelling penalty--No substantial question of law-- CIT v. Sunila Sharma (P&H) . . . 462

S. 271C --Deduction of tax at source--Penalty--Failure to deduct tax at source--Finding by Commissioner (Appeals) and Tribunal that tax and interest under section 201(1) and (1A) paid and no case made out for levy of penalty--No substantial question of law arises-- CIT v.Bank of Nova Scotia (SC). . . 550

 

Income-tax Rules, 1962 :

R. 8D --Income--Computation of income--Disallowance under section 14A--Appellate authorities finding ten per cent. of income earned could be apportioned towards expenses for earning dividend--Finding not perverse-- CIT v. India Advantage Securities Ltd. (Bom) . . . 471

 

__._,_.___

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Posted by: CA RAJU SHAH <shahmars@hotmail.com>

---

Maharashtra VAT- Downloading of Digitally Signed Registration Certificate

Maharashtra VAT- Downloading of Digitally Signed Registration Certificate

Office of the, Commissioner of Sales Tax, 8th Floor, Vikrikar Bhavan, Mazgaon, Mumbai-400010.

TRADE CIRCULAR To No. ACST VAT-2/ Digitally Signed Registration Certificate/2015 / Trade Circular No. 19T of 2015 Mumbai. Dated 21/12/2015 Subject: Downloading of Digitally Signed Registration Certificate Ref: Trade Circular No. 7T of 2015 Dt. 19th May , 2015.

 

A dealer seeking registration under the Maharashtra Value added Tax Act, 2002 submits an online application for registration along with the required documents. The Registration Officer to whom such application gets allocated generates the TIN if the application is found to be correct and is supported with the appropriate documents. Subsequently, the Registration Officer informs the applicant through an email that the TIN has been granted and sends a printed copy of the (TIN) registration certificate to the applicant on the address mentioned in the application through Speed Post. However, it has been observed that in many cases the delivery of (TIN) registration certificates to the applicant is delayed. In order to ensure immediate availability of the (TIN) registration certificate to the applicant, a facility has been made available to download the digitally signed (TIN) registration certificate from the website of the Maharashtra Sales Tax Department i.e. www.mahavat.gov.in  . The Annexure A attached to this circular provides information about downloading of the (TIN) registration certificate. It is clarified that facility of making digitally signed certificate is made available to the dealers to whom registration certificates have been granted on or after 22nd December 2015. It may be noted that the registration officer shall continue to send the physical copy of (TIN) registration certificate to the applicant on the address mentioned in the application through India Post.

This circular cannot be made use for legal interpretation of provisions of law as it is clarificatory in nature. If any member of the trade has any doubt, the same may be referred to this office for further clarification. You are requested to bring the contents of this circular to the notice of the members of your association. (Rajiv Jalota) Commissioner of Sales Tax, Maharashtra State, Mumbai.

 

ANNEXURE "A' INFORMATION ABOUT DOWNLOADING THE (TIN) REGISTRATION CERTIFICATE

A) For VAT/CST/PTRC Certificate Download

1)  Enroll yourself on the website by using your TIN ( for the TINs generated on/after 21st December 2015)

2)  Click the button New User register here' appearing on 'My Tax Portal' or Enter the URL

3)  Click Dealer Enrollment' link

4)  Fill all the details in the form and submit the form

5)  Do not share the Password created by you during enrollment. process.

6)  Login with 11 digit TIN (DO NOT SUFFIX 'V' OR 'C' OR -P.) and password created during enrollment.

7)  Click the link -Registration Certificates‑

8)    Click the corresponding application number/s appearing on the screen to download the Registration Certificate/s 9) Save the download Registration Certificate/s

 

B) For PTEC Registration Certificate Download

1)    Go to the Downloads section of the website

2)     Click PTEC Registration Certificate

3)     Enter PTEC TIN allotted/communicated

4)     Click Submit button

5)     Download the PTEC Registration Certificate

6)    Validate the Digital Signature as described in point no. C of the Annexure

 

C) Validation of the Digital Signature :- a)    Open the Registration Certificate with Acrobat Reader b)     Click on the signature mentioned on the certificate c)    Click on Validate signature. If green coloured – mark is not seen on the signature part of the certificate, then d)   Click on signature properties e) Click on show signer's certificate f) Click on Trust Tab g)     Click on Add to Trusted Certificate tab h)     Check all the check all the boxes on the window i) Click validate signature tab j)  √ Mark in green colour will appear on Signature after successful validation

D)   Take the printout of the certificate/s and keep it in safe custody

E)   For more details kindly refer the instruction sheet for "Registration Certificate Download Instructions Sheet" available in the section "Instruction sheets for e-Services" 

Regards,
-------
CA.C.V.PAWAR
PATIL DAWARE GIRASE PAWAR & ASSOCIATES

CHARTERED ACCOUNTANTS

0253-2319641. M-9423961209

INDIAN CA - NURTURED IN INDIA, GROOMED FOR THE WORLD

ITR (TRIB) Volume 45 : Part 2 (Issue dated : 11-1-2016)

 

ITR'S TRIBUNAL TAX REPORTS (ITR (TRIB))--PRINT AND ONLINE EDITION

ONLINE EDITION

SUBJECT INDEX TO CASES REPORTED

Appeal to Appellate Tribunal --Commissioner (Appeals) in assessee’s appeal deleting addition in hands of assessee and directing addition in hands of shareholder--Failure by Commissioner (Appeals) to grant opportunity of hearing before making addition--Assessee can challenge validity of directions--Directions to be considered as futile--Income-tax Act, 1961-- ITO v. Biotech Ophthalmic P. Ltd. (Ahd) . . . 453

----Rectification of mistake--Observations made by Tribunal about profession of chartered accountants not necessary to adjudicate issues urged before Tribunal--Order rectified--Income-tax Act, 1961, s. 254(2)-- Vijay V. Meghani v. Asst. CIT
(Mumbai) . . . 499

Appeal to Commissioner (Appeals) --Power to admit additional evidence--Adequate and real opportunities lacking during assessment proceedings--Admission of additional evidence proper--Income-tax Act, 1961--Income-tax Rules, 1962, r. 46A-- Asst. CIT v. R. P. G. Credit and Capital Ltd. (Delhi) . . . 440

Business expenditure --Disallowance--Payments in cash exceeding specified limit--Exclusion from disallowance--Reasonable explanation for payments in cash--Payments made under compelling circumstances on account of business expediency--No disallowance--Income-tax Act, 1961, s. 40A(3)-- ITO v. Smt. Asha Agarwal
(Lucknow) . . . 462

----Vehicle expenses and staff welfare expenses--Ad hoc disallowance--Commissioner (Appeals) restricting disallowance--Assessee neither preferring appeal nor cross-objection--Order of Commissioner (Appeals) to be confirmed--Income-tax Act, 1961-- ITO v. Smt. Asha Agarwal (Lucknow) . . . 462

----Wages and site expenses--Commissioner (Appeals) restricting disallowance of total wages on ground of possible leakages and deleting disallowance on site expenses on ground ad hoc--Failure by Department to point out specific defects in order of Commissioner (Appeals)--Order of Commissioner (Appeals) to be confirmed--Income-tax Act, 1961-- ITO v. Smt. Asha Agarwal (Lucknow) . . . 462

Cash credit --Appeal to Commissioner (Appeals)--Submission of additional evidence before Commissioner (Appeals)--Remand report called for--Assessing Officer accepting loans taken by assessee after verification--Commissioner (Appeals) deleting addition based on admission of Assessing Officer--Appeal by Department not maintainable--Income-tax Act, 1961, ss. 68, 133(6), 153C--Income-tax Rules, 1962, r. 46A-- Asst. CIT v. R. P. G. Credit and Capital Ltd.(Delhi) . . . 440

----Commissioner (Appeals) deleting addition on finding that assessee depositing money from its opening balance--Failure by Department to dislodge findings of Commissioner (Appeals)--Order of Commissioner (Appeals) to be confirmed--Income-tax Act, 1961, s. 68-- ITO v. Smt. Asha Agarwal (Lucknow) . . . 462

Depreciation --Ad hoc disallowance on purchase of machinery--Commissioner (Appeals) allowing depreciation after verifying bills--Failure by Department to point out defects in order of Commissioner (Appeals)--Order to be confirmed--Income-tax Act, 1961-- ITO v. Smt. Asha Agarwal (Lucknow) . . . 462

Dividend --Deemed dividend--Loan to shareholder--Condition precedent--Shareholder must be both registered and beneficial--Assessee not registered shareholder--Provisions of section 2(22)(e) not applicable--Income-tax Act, 1961, s. 2(22)(e)-- ITO v. Biotech Ophthalmic P. Ltd. (Ahd) . . . 453

Reassessment --Notice--No notice under section 143(2) issued within six months from end of relevant assessment year--No assessment proceedings pending in relation to relevant assessment year when reference made to Transfer Pricing Officer--Invalid reference--Order determining adjustment to international transaction nullity in law and void ab initio--Notice issued under section 148 by Assessing Officer based on order of Transfer Pricing Officer not valid and subsequent assessment order to be quashed--Income-tax Act, 1961, ss. 92CA, 143, 144C, 147, 148-- Maximize Learning P. Ltd. v. Asst. CIT (Pune) . . . 476

 

PRINT EDITION

Volume 45 : Part 2 (Issue dated : 11-1-2016)

SUBJECT INDEX TO CASES REPORTED IN THIS PART

Appeal to Appellate Tribunal --Maintainability of appeal--Assessing Officer initiating reassessment proceedings based on order of Transfer Pricing Officer--No findings given by Dispute Resolution Panel on validity of Assessing Officer to adopt order passed by Transfer Pricing Officer based on an illegal reference--Appeal maintainable against order passed by Assessing Officer under section 143(3) read with sections 147 and 144C pursuant to direction of Dispute Resolution Panel--Income-tax Act, 1961-- Bucyrus India P. Ltd. v . Deputy CIT (Kolkata) . . . 216

Business expenditure --Deduction only on actual payment--Contribution towards employees’ State insurance fund--Contributions paid before due date for filing return--To be allowed--Income-tax Act, 1961, ss. 2(24)(x), 36(1)(x)-- Brothers Pharma P. Ltd. v. ITO (Jaipur) . . . 154

----Disallowance--Payments in cash exceeding prescribed limit--Employees insisting upon cash payments and in order to maintain good relation assessee paying salary in cash for various months--Exceptions provided in rule 6DD not exhaustive--Business expediencies and payments not covering under section 40A(3)--Disallowance not proper--Income-tax Act, 1961, s. 40A(3)--Income-tax Rules, 1962, r. 6DD-- Brothers Pharma P. Ltd. v. ITO (Jaipur) . . . 154

----Disallowance--Payments to non-resident--Failure to deduct tax at source--Reimbursement of expenses not income in hands of non-resident--Not in nature of fees for technical services--Provision requiring deduction of tax at source not applicable--Income-tax Act, 1961, ss. 40(a)(ia), 195-- ITO v. Cerner Health Care Solutions P. Ltd. (Bang) . . . 207

Business income --Remission or cessation of liability--Assessee not writing off any liability on account of loan creditor, trade creditor or security creditor during year under consideration--Failure by Department to establish that liability not in existence or not paid in subsequent year--Sum cannot be brought to tax--Income-tax Act, 1961, s. 41(1)-- Brothers Pharma P. Ltd. v. ITO (Jaipur) . . . 154

Capital gains --Full value of consideration--Value adopted by stamp valuation authority--Section 50C cannot be invoked on account of long-term capital gains on sale of leasehold property--Income-tax Act, 1961, s. 50C-- ITO v. Hari Om Gupta
(Lucknow) . . . 137

Capital or revenue expenditure --Expenditure on repairs and maintenance--Genuineness of expenses not proved by assessee--Disallowance of expenditure justified--Income-tax Act, 1961-- Brothers Pharma P. Ltd. v. ITO (Jaipur) . . . 154

Company --Dividend--Deemed dividend--Loan to shareholder--Transactions between assessee and company in current account--Loan account different from current account with shareholder--Provisions of section 2(22)(e) not applicable to transactions in current account--Income-tax Act, 1961, s. 2(22)(e)-- ITO v. Smt. Gayatri Chakraborty (Kolkata) . . . 197

Exemption --Export--Computation of deduction--Any item reduced from export turnover to be reduced from total turnover also--Income-tax Act, 1961, s. 10A-- ITO v. Cerner Health Care Solutions P. Ltd. (Bang) . . . 207

Fringe benefit tax --Provisions within ambit of Income-tax Act, 1961 and do not operate independently--Manufacture of tea--Business expenditure of assessee determined to extent of 40 per cent.--Business expenditure for purpose of fringe benefit tax to be considered at 40 per cent.--Income-tax Act, 1961, s. 115WA--Income-tax Rules, 1962, r. 8-- McLeod Russel India Ltd. v. Asst. CIT (Kolkata) . . . 182

Income from undisclosed sources --Unexplained money--Cash book showing shortage of cash--Failure by assessee to produce evidence regarding shortage of cash before authorities--Addition confirmed--Income-tax Act, 1961-- Brothers Pharma P. Ltd. v. ITO(Jaipur) . . . 154

Income-tax survey --Export--Exemption--Excess gold found at survey--Assessee disclosing in books of account sale of excess gold obtained on recouping wastage--Books accepted by Department--Surrender of Rs. 11 lakhs to cover various discrepancies--Disclosure relating to regular business--Addition justified but assessee entitled to exemption because income directly related to export business of assessee--Income-tax Act, 1961, s. 10A-- Bridal Jewellery Mfg. Co. v. ITO (Delhi) . . . 119

Penalty --Concealment of income or furnishing of inaccurate particulars of income--Effect of Circular No. 21 of 2015 dated 10-12-2015--Department’s appeals against orders of Commissioner (Appeals) granting relief pending before Tribunal--Tax effect excluding interest not more than Rs. 10,00,000--Appeals not maintainable--Income-tax Act, 1961, s. 271(1)(c)--CBDT Circular No. 21 of 2015, dated 10-12-2015-- Deputy CIT v. Soma Textiles and Industries Ltd. (Ahd) . . . 147

----Concealment of income--Assessee claiming losses with regard to incomplete work--Assessing Officer disallowing--Not a case of concealment of particulars because information given by assessee in its return not found to be incorrect--Claim of assessee supported by Accounting Standard-7 issued by ICAI--Penalty not leviable--Income-tax Act, 1961, s. 271(1)(c)-- Uhde India P. Ltd. v. Asst. CIT (Mumbai) . . . 177

Reassessment --Limitation--Contention that reassessment proceedings barred by limitation--Failure by assessee to produce specific ground on limitation and file additional ground of appeal--Issue not entertained--Income-tax Act, 1961-- Bucyrus India P. Ltd. v . Deputy CIT(Kolkata) . . . 216

----Notice--Validity--No notice for assessment issued--Reference to Transfer Pricing Officer for determination of arm’s length price without pendency of assessment proceedings--Order of adjustment to arm’s length price on illegal reference by Transfer Pricing Officer--Cannot be basis for reassessment proceedings--Income-tax Act, 1961, ss. 92CA, 143(1), (2), (3), 144C, 147, 148-- Bucyrus India P. Ltd. v . Deputy CIT
(Kolkata) . . . 216

Search and seizure --Application of seized assets--Provision prohibiting adjustment of seized cash against advance tax liability--Prospective--Assessing Officer adjusting seized cash towards tax liability determined in section 153A assessment and in accordance with provisions of section 132B--Subsequent revocation of adjustment under section 154 illegal--Interest under sections 234B and 234C cannot be charged for assessment year 2006-07--Income-tax Act, 1961, ss. 132B, 153A, 154, 234B, 234C-- Asst. CIT v. Narendra N. Thacker(Kolkata) . . . 188

 

SECTIONWISE INDEX TO CASES REPORTED IN THIS PART

Income-tax Act, 1961

S. 2(22)(e) --Company--Dividend--Deemed dividend--Loan to shareholder--Transactions between assessee and company in current account--Loan account different from current account with shareholder--Provisions of section 2(22)(e) not applicable to transactions in current account-- ITO v. Smt. Gayatri Chakraborty (Kolkata) . . . 197

S. 2(24)(x) --Business expenditure--Deduction only on actual payment--Contribution towards employees’ State insurance fund--Contributions paid before due date for filing return--To be allowed-- Brothers Pharma P. Ltd. v. ITO (Jaipur) . . . 154

S. 10A --Exemption--Export--Computation of deduction--Any item reduced from export turnover to be reduced from total turnover also-- ITO v. Cerner Health Care Solutions P. Ltd.(Bang) . . . 207

----Income-tax survey--Export--Exemption--Excess gold found at survey--Assessee disclosing in books of account sale of excess gold obtained on recouping wastage--Books accepted by Department--Surrender of Rs. 11 lakhs to cover various discrepancies--Disclosure relating to regular business--Addition justified but assessee entitled to exemption because income directly related to export business of assessee-- Bridal Jewellery Mfg. Co. v. ITO (Delhi) . . . 119

S. 36(1)(x) --Business expenditure--Deduction only on actual payment--Contribution towards employees’ State insurance fund--Contributions paid before due date for filing return--To be allowed-- Brothers Pharma P. Ltd. v. ITO (Jaipur) . . . 154

S. 40(a)(ia) --Business expenditure--Disallowance--Payments to non-resident--Failure to deduct tax at source--Reimbursement of expenses not income in hands of non-resident--Not in nature of fees for technical services--Provision requiring deduction of tax at source not applicable-- ITO v. Cerner Health Care Solutions P. Ltd.
(Bang) . . . 207

S. 40A(3) --Business expenditure--Disallowance--Payments in cash exceeding prescribed limit--Employees insisting upon cash payments and in order to maintain good relation assessee paying salary in cash for various months--Exceptions provided in rule 6DD not exhaustive--Business expediencies and payments not covering under section 40A(3)--Disallowance not proper-- Brothers Pharma P. Ltd. v. ITO (Jaipur) . . . 154

S. 41(1) --Business income--Remission or cessation of liability--Assessee not writing off any liability on account of loan creditor, trade creditor or security creditor during year under consideration--Failure by Department to establish that liability not in existence or not paid in subsequent year--Sum cannot be brought to tax-- Brothers Pharma P. Ltd. v. ITO (Jaipur) . . . 154

S. 50C --Capital gains--Full value of consideration--Value adopted by stamp valuation authority--Section 50C cannot be invoked on account of long-term capital gains on sale of leasehold property-- ITO v. Hari Om Gupta (Lucknow) . . . 137

S. 92CA --Reassessment--Notice--Validity--No notice for assessment issued--Reference to Transfer Pricing Officer for determination of arm’s length price without pendency of assessment proceedings--Order of adjustment to arm’s length price on illegal reference by Transfer Pricing Officer--Cannot be basis for reassessment proceedings-- Bucyrus India P. Ltd. v . Deputy CIT (Kolkata) . . . 216

S. 115WA --Fringe benefit tax--Provisions within ambit of Income-tax Act, 1961 and do not operate independently--Manufacture of tea--Business expenditure of assessee determined to extent of 40 per cent.--Business expenditure for purpose of fringe benefit tax to be considered at 40 per cent.-- McLeod Russel India Ltd. v. Asst. CIT
(Kolkata) . . . 182

S. 132B --Search and seizure--Application of seized assets--Provision prohibiting adjustment of seized cash against advance tax liability--Prospective--Assessing Officer adjusting seized cash towards tax liability determined in section 153A assessment and in accordance with provisions of section 132B--Subsequent revocation of adjustment under section 154 illegal--Interest under sections 234B and 234C cannot be charged for assessment year 2006-07--Asst. CIT v. Narendra N. Thacker (Kolkata) . . . 188

S. 143(1), (2), (3) --Reassessment--Notice--Validity--No notice for assessment issued--Reference to Transfer Pricing Officer for determination of arm’s length price without pendency of assessment proceedings--Order of adjustment to arm’s length price on illegal reference by Transfer Pricing Officer--Cannot be basis for reassessment proceedings-- Bucyrus India P. Ltd. v . Deputy CIT (Kolkata) . . . 216

S. 144C --Reassessment--Notice--Validity--No notice for assessment issued--Reference to Transfer Pricing Officer for determination of arm’s length price without pendency of assessment proceedings--Order of adjustment to arm’s length price on illegal reference by Transfer Pricing Officer--Cannot be basis for reassessment proceedings-- Bucyrus India P. Ltd. v . Deputy CIT (Kolkata) . . . 216

S.147 --Reassessment--Notice--Validity--No notice for assessment issued--Reference to Transfer Pricing Officer for determination of arm’s length price without pendency of assessment proceedings--Order of adjustment to arm’s length price on illegal reference by Transfer Pricing Officer--Cannot be basis for reassessment proceedings-- Bucyrus India P. Ltd. v . Deputy CIT (Kolkata) . . . 216

S. 148 --Reassessment--Notice--Validity--No notice for assessment issued--Reference to Transfer Pricing Officer for determination of arm’s length price without pendency of assessment proceedings--Order of adjustment to arm’s length price on illegal reference by Transfer Pricing Officer--Cannot be basis for reassessment proceedings-- Bucyrus India P. Ltd. v . Deputy CIT (Kolkata) . . . 216

S. 153A --Search and seizure--Application of seized assets--Provision prohibiting adjustment of seized cash against advance tax liability--Prospective--Assessing Officer adjusting seized cash towards tax liability determined in section 153A assessment and in accordance with provisions of section 132B--Subsequent revocation of adjustment under section 154 illegal--Interest under sections 234B and 234C cannot be charged for assessment year 2006-07--Asst. CIT v. Narendra N. Thacker (Kolkata) . . . 188

S. 154 --Search and seizure--Application of seized assets--Provision prohibiting adjustment of seized cash against advance tax liability--Prospective--Assessing Officer adjusting seized cash towards tax liability determined in section 153A assessment and in accordance with provisions of section 132B--Subsequent revocation of adjustment under section 154 illegal--Interest under sections 234B and 234C cannot be charged for assessment year 2006-07--Asst. CIT v. Narendra N. Thacker (Kolkata) . . . 188

S. 195 --Business expenditure--Disallowance--Payments to non-resident--Failure to deduct tax at source--Reimbursement of expenses not income in hands of non-resident--Not in nature of fees for technical services--Provision requiring deduction of tax at source not applicable-- ITO v. Cerner Health Care Solutions P. Ltd.
(Bang) . . . 207

S. 234B --Search and seizure--Application of seized assets--Provision prohibiting adjustment of seized cash against advance tax liability--Prospective--Assessing Officer adjusting seized cash towards tax liability determined in section 153A assessment and in accordance with provisions of section 132B--Subsequent revocation of adjustment under section 154 illegal--Interest under sections 234B and 234C cannot be charged for assessment year 2006-07--Asst. CIT v. Narendra N. Thacker (Kolkata) . . . 188

S. 234C --Search and seizure--Application of seized assets--Provision prohibiting adjustment of seized cash against advance tax liability--Prospective--Assessing Officer adjusting seized cash towards tax liability determined in section 153A assessment and in accordance with provisions of section 132B--Subsequent revocation of adjustment under section 154 illegal--Interest under sections 234B and 234C cannot be charged for assessment year 2006-07--Asst. CIT v. Narendra N. Thacker (Kolkata) . . . 188

S. 271(1)(c) --Penalty--Concealment of income--Assessee claiming losses with regard to incomplete work--Assessing Officer disallowing--Not a case of concealment of particulars because information given by assessee in its return not found to be incorrect--Claim of assessee supported by Accounting Standard-7 issued by ICAI--Penalty not leviable-- Uhde India P. Ltd. v. Asst. CIT (Mumbai) . . . 177

----Penalty--Concealment of income or furnishing of inaccurate particulars of income--Effect of Circular No. 21 of 2015 dated 10-12-2015--Department’s appeals against orders of Commissioner (Appeals) granting relief pending before Tribunal--Tax effect excluding interest not more than Rs. 10,00,000--Appeals not maintainable-- Deputy CIT v. Soma Textiles and Industries Ltd. (Ahd) . . . 147

Income-tax Rules, 1962

R. 6DD --Business expenditure--Disallowance--Payments in cash exceeding prescribed limit--Employees insisting upon cash payments and in order to maintain good relation assessee paying salary in cash for various months--Exceptions provided in rule 6DD not exhaustive--Business expediencies and payments not covering under section 40A(3)--Disallowance not proper-- Brothers Pharma P. Ltd. v. ITO
(Jaipur) . . . 154

R. 8 --Fringe benefit tax--Provisions within ambit of Income-tax Act, 1961 and do not operate independently--Manufacture of tea--Business expenditure of assessee determined to extent of 40 per cent.--Business expenditure for purpose of fringe benefit tax to be considered at 40 per cent.-- McLeod Russel India Ltd. v. Asst. CIT
(Kolkata) . . . 182

 

 

ITR Volume 380 : Part 2 (Issue dated : 11-1-2016)

 

INCOME TAX REPORTS (ITR)--PRINT AND ONLINE EDITION

ONLINE EDITION

SUBJECT INDEX TO CASES REPORTED

SUPREME COURT

Appeal to High Court --Monetary limits for litigation by Department--Appeal on identical point for subsequent year admitted--Appeal for earlier year not to be rejected for low tax effect--Income-tax Act, 1961, s. 260A-- CIT v. Bangalore Housing Development and Investments . . .1

Penalty --Concealment of income--Loss shown in returns and income assessed at nil--Penalty imposable--Income-tax Act, 1961, s. 271(1)(c)-- CIT v. Keti Chem Pvt. Ltd. . . . 3

HIGH COURTS

Reassessment --Notice after four years--Not permissible on mere change of opinion --Questions specifically raised and considered in original assessment--No failure by assessee to disclose facts necessary for assessment--No new material--Reassessment on same grounds not permissible--Income-tax Act, 1961, ss. 10B, 148-- Swarovski India Pvt. Ltd. v.Deputy CIT (Delhi) . . . 4

Settlement of cases --Powers of Settlement Commission--Substantive powers of income-tax authorities cannot be exercised--Application for settlement of case--No evidence of undisclosed income--Additions to income by Settlement Commission not valid--Income-tax Act, 1961, ss. 245D, 245F-- Pawan Kumar v. Union of India (Jharkhand) . . . 13

 

PRINT EDITION

ITR Volume 380 : Part 2 (Issue dated : 11-1-2016)

SUBJECT INDEX TO CASES REPORTED IN THIS PART

SUPREME COURT

Depreciation --Carry forward and set off--Amendment in 1996--Effect--Unabsorbed depreciation as on 1-4-1997 can be set off against income from any head for assessment year immediately following 1-4-1997 and thereafter unabsorbed depreciation if any to be set off only against business income for a period of eight assessment years--Income-tax Act, 1961, s. 32(2)-- Peerless General Finance and Investment Co. Ltd. v. CIT . . . 165

HIGH COURTS

Appeal to High Court --Limitation--Application for condonation of delay--No reasonable explanation for delay--Delay could not be condoned--Income-tax Act, 1961, s. 260A-- CIT v.Arvinder Singh (Delhi) . . . 179

----Powers of High Court--High Court has power to consider substantial question of law relating to issue not raised before or considered by Tribunal--Income-tax Act, 1961, s. 260A-- B. J. Services Co. Middle East Ltd. v. Asst. CIT (Uttarakhand) . . . 138

----Substantial questions of law--Exemption--Educational institution--Assessee running two institutions in same premises--Whether composite aggregate income to be segregated--Depends upon status and legal identities--Distinction between two institutions to be considered on basis of recognition--Whether institution established under Societies Registration Act, 1860 to be seen--No examination of status of institution and its annual receipts--No finding whether during assessment year whether there was separate inter college--Substantial questions of law arise--Income-tax Act, 1961, ss. 10(23C)(vi), 260A--CIT (Exemption) v. Chironji Lal Virendra Pal Saraswati Shiksha Parishad (All) . . . 265

Assessment --Amalgamation--Assessee amalgamated with successor company--Assessment proceedings with non-existent assessee--Not valid--Department not entitled to benefit of section 292B--Income-tax Act, 1961, s 292B-- CIT v. Intel Technology India Pvt. Ltd. (Karn) . . . 272

----General principles--Presumption that assessment order has been passed after application of mind--Income-tax Act, 1961, s. 143(3)-- Oracle Systems Corporation v. Asst. DIT (International Taxation) (Delhi) . . . 232

----Notice under section 143(2)--Limitation--Law applicable--Amendment of proviso to section 143(2) with effect from 1-4-2008--Return filed on 24-7-2007--Proviso as amended not applicable--Notice had to be issued within twelve months--Months means calendar months--Notice issued on 26-9-2008--Barred by limitation--Income-tax Act, 1961, s. 143-- Tulsi Food Products v. Deputy CIT (All) . . . 192

Capital gains --Computation of capital gains--Assessee tenant of land for a long time--Tripartite agreement among assessee, landlord and developer--Assessee granted lease for sixty-five years with regard to 18 per cent. of undivided share in land--Cost of construction agreed upon--Computation of capital gains on basis of agreement--Computation not rejected by Assessing Officer--Addition on basis of project cost indicated by developer--Not justified--Income-tax Act, 1961-- CIT v. Khivraj Motors (Karn) . . . 215

Capital or revenue expenditure --Memorandum permitting assessee to let out properties--Compensation to existing tenants for securing vacant possession--Object of deriving higher rent out of business necessity and commercial expediency--No enduring benefit--Revenue expenditure--Income-tax Act, 1961-- Shyam Burlap Co. Ltd. v. CIT (Cal) . . . 151

Deduction of tax at source --Hospital--Payments whether salary or professional charges--Professional doctors not entitled to benefits allowed to salaried doctors--Not employees of hospital but independent professionals--Payments to doctors not salary but professional charges and tax deductible at source accordingly--Income-tax Act, 1961, ss. 192, 194J, 201(1), (1A)-- CIT (TDS) v. Ivy Health Life Sciences Pvt. Ltd. (P&H) . . . 242

Double taxation avoidance --Refund of excess tax paid on behalf of employees by U. K. company--Interest on refund--Rate of tax--Assessee carrying on business through permanent establishment in India--Debt claim in respect of which interest was paid effectively connected with permanent establishment--Interest assessable under paragraph (6) of article 12 of Agreement--Double Taxation Avoidance Agreement between India and the U. K., art. 12-- B. J. Services Co. Middle East Ltd. v. Asst. CIT (Uttarakhand) . . . 138

Exemption --Newly established export oriented undertaking--Condition precedent for exemption under section 10B--Manufacture of article--Meaning of manufacture--Assembling of instruments and apparatus for measuring and detecting ionizing radiators amounts to manufacture--Assessee entitled to exemption under section 10B--Income-tax Act, 1961, s. 10B-- CIT v. Saint Gobain Crystals and Detectors India P. Ltd. (Karn) . . . 226

Income-tax --Principles of consistency--Memorandum of association of assessee permitting it to do business letting out properties--Income from rent whether from property or business--No adjudication in earlier years by Tribunal in light of memorandum--Principles of consistency had no application--That assessee showing income in previous years under “Income from house property†--Not a ground for denial of deduction-- Shyam Burlap Co. Ltd. v. CIT(Cal) . . . 151

Non-resident --Presumptive tax--Mineral oil--Special provision relating to mineral oils--Scope of section 44BB--Section 44BB applicable to profits derived by non-residents by supplying plant and machinery for extraction or production of mineral oils--Provision not applicable to interest on refund of tax--Income-tax Act, 1961, s. 44BB-- B. J. Services Co. Middle East Ltd. v. Asst. CIT (Uttarakhand) . . . 138

Penalty --Concealment of income or furnishing of inaccurate particulars thereof--Amount paid to foreign company--No deduction of tax at source on basis of certificate issued by chartered accountant--No violation of provision of Chapter XVII-B attracting disallowance under section 40(a)(ia)--Failure to deduct tax at source--Not a case of furnishing of inaccurate particulars or concealment of income--Penalty could not be levied--Income-tax Act, 1961, ss. 40(a)(ia), 271(1)(c)-- CIT v. Filtrex Technologies P. Ltd. (Karn) . . . 222

Presumptive tax --Computation of presumptive income--Non-resident--Prospecting for, or extraction or production of mineral oils--Service tax collected by assessee on amount paid to it for rendering services--Service tax not an amount paid or payable or received or deemed to be received by assessee for services rendered by it--Assessee only collecting service tax for passing it on to Government--Not includible in gross receipt--Circular No. 4 of 2008, dated 28-4-2008--Circular No. 1 of 2014, dated 13-1-2014--Income-tax Act, 1961, s. 44BB--DIT v. Mitchell Drilling International Pvt. Ltd. (Delhi) . . . 130

Reassessment --Notice after four years--Failure to disclose material facts necessary for assessment--Assessment under particular provision of Double Taxation Avoidance Agreement between India and USA--Notice on the ground that different part of same provision applicable--No evidence of failure to disclose material facts--Notice not valid--Income-tax Act, 1961, ss. 147, 148--Double Taxation Avoidance Agreement between India and USA, art. 12(2)(a)(ii)-- Oracle Systems Corporation v. Asst. DIT (International Taxation)(Delhi) . . . 232

----Scope of--Effect of Explanation 3 to section 147--Reassessment of income not mentioned in notice under section 148--Such income must come to the notice of the Assessing Officer during the course of reassessment proceedings--Capital gains considered in block assessment proceedings under section 158BC prior to initiation or reassessment proceedings--Could not be reassessed on protective basis--Income-tax Act, 1961, ss. 147, 148-- Dr. Shiva Kant Mishra v. CIT (All) . . . 257

----Writ--Validity of reassessment--Assessee participating in reassessment proceedings--Alternative remedy of appeal available against order of reassessment--Writ would not issue to quash reassessment--Income-tax Act, 1961, ss. 147, 148, 246A--Constitution of India, art. 226-- Mobis India Ltd. v. Deputy CIT (LTU) (Mad) . . . 170

Settlement of cases --Application for settlement of case--Application by person related to applicant--Meaning of “related party†--Effect of Explanation to section 245C(1)--Company would be a related party only if a director of such company has a substantial interest in applicant--Substantial interest should be held directly--Clubbing of shares not permitted--Income-tax Act, 1961, s. 245C-- Rockland Hotels Ltd. v. ITSC, Principal Bench(Delhi) . . . 197

Words and phrases --Meaning of “manufacture†-- CIT v. Saint Gobain Crystals and Detectors India P. Ltd. (Karn) . . . 226

Writ --Existence of alternative remedy--Writ will not normally issue--Constitution of India, art. 226-- Mobis India Ltd. v. Deputy CIT (LTU) (Mad) . . . 170

 

AUTHORITY FOR ADVANCE RULINGS

Non-resident --Taxability in India--Deduction of tax at source--Penalty paid to Government of U. S. A. pursuant to order of court in U. S. A. for violations of securities law in that country--No tax liability--No tax required to be deducted at source--Income-tax Act, 1961, s. 195--Satyam Computer Services Ltd., In re . . . 189

----Taxability in India--Installation project continuing only for 178 days in fiscal year, less than 183 days--No permanent establishment of applicant in India--Business profits from execution of project taxable only in country where applicant was resident--Double Taxation Avoidance Agreement between India and Singapore, art. 7(1)-- Tiong Woon Project and Contracting (Pte) Ltd., In re . . . 187

 

SECTIONWISE INDEX TO CASES REPORTED IN THIS PART

Constitution of India :

Art. 226 --Reassessment--Writ--Validity of reassessment--Assessee participating in reassessment proceedings--Alternative remedy of appeal available against order of reassessment--Writ would not issue to quash reassessment-- Mobis India Ltd. v. Deputy CIT (LTU) (Mad) . . . 170

----Writ--Existence of alternative remedy--Writ will not normally issue-- Mobis India Ltd. v.Deputy CIT (LTU) (Mad) . . . 170

Double Taxation Avoidance Agreement between India and Singapore :

Art. 7(1) --Non-resident--Taxability in India--Installation project continuing only for 178 days in fiscal year, less than 183 days--No permanent establishment of applicant in India--Business profits from execution of project taxable only in country where applicant was resident--Tiong Woon Project and Contracting (Pte) Ltd., In re (AAR. . . 187

Double Taxation Avoidance Agreement between India and the U. K. :

Art. 12 --Double taxation avoidance--Refund of excess tax paid on behalf of employees by U. K. company--Interest on refund--Rate of tax--Assessee carrying on business through permanent establishment in India--Debt claim in respect of which interest was paid effectively connected with permanent establishment--Interest assessable under paragraph (6) of article 12 of Agreement-- B. J. Services Co. Middle East Ltd. v. Asst. CIT(Uttarakhand) . . . 138

Double Taxation Avoidance Agreement between India and USA :

Art. 12(2)(a)(ii) --Reassessment--Notice after four years--Failure to disclose material facts necessary for assessment--Assessment under particular provision of Double Taxation Avoidance Agreement between India and USA--Notice on the ground that different part of same provision applicable--No evidence of failure to disclose material facts--Notice not valid--Oracle Systems Corporation v. Asst. DIT (International Taxation) (Delhi) . . . 232

Income-tax Act, 1961 :

S. 10(23C)(vi) --Appeal to High Court--Substantial questions of law--Exemption--Educational institution--Assessee running two institutions in same premises--Whether composite aggregate income to be segregated--Depends upon status and legal identities--Distinction between two institutions to be considered on basis of recognition--Whether institution established under Societies Registration Act, 1860 to be seen--No examination of status of institution and its annual receipts--No finding whether during assessment year whether there was separate inter college--Substantial questions of law arise-- CIT (Exemption) v. Chironji Lal Virendra Pal Saraswati Shiksha Parishad (All) . . . 265

S. 10B --Exemption--Newly established export oriented undertaking--Condition precedent for exemption under section 10B--Manufacture of article--Meaning of manufacture--Assembling of instruments and apparatus for measuring and detecting ionizing radiators amounts to manufacture--Assessee entitled to exemption under section 10B-- CIT v. Saint Gobain Crystals and Detectors India P. Ltd. (Karn) . . . 226

S. 32(2) --Depreciation--Carry forward and set off--Amendment in 1996--Effect--Unabsorbed depreciation as on 1-4-1997 can be set off against income from any head for assessment year immediately following 1-4-1997 and thereafter unabsorbed depreciation if any to be set off only against business income for a period of eight assessment years--Peerless General Finance and Investment Co. Ltd. v. CIT (SC). . . 165

S. 40(a)(ia) --Penalty--Concealment of income or furnishing of inaccurate particulars thereof--Amount paid to foreign company--No deduction of tax at source on basis of certificate issued by chartered accountant--No violation of provision of Chapter XVII-B attracting disallowance under section 40(a)(ia)--Failure to deduct tax at source--Not a case of furnishing of inaccurate particulars or concealment of income--Penalty could not be levied--CIT v. Filtrex Technologies P. Ltd. (Karn) . . . 222

S. 44BB --Non-resident--Presumptive tax--Mineral oil--Special provision relating to mineral oils--Scope of section 44BB--Section 44BB applicable to profits derived by non-residents by supplying plant and machinery for extraction or production of mineral oils--Provision not applicable to interest on refund of tax-- B. J. Services Co. Middle East Ltd. v. Asst. CIT(Uttarakhand) . . . 138

----Presumptive tax--Computation of presumptive income--Non-resident--Prospecting for, or extraction or production of mineral oils--Service tax collected by assessee on amount paid to it for rendering services--Service tax not an amount paid or payable or received or deemed to be received by assessee for services rendered by it--Assessee only collecting service tax for passing it on to Government--Not includible in gross receipt-- DIT v. Mitchell Drilling International Pvt. Ltd. (Delhi) . . . 130

S. 143 --Assessment--Notice under section 143(2)--Limitation--Law applicable--Amendment of proviso to section 143(2) with effect from 1-4-2008--Return filed on 24-7-2007--Proviso as amended not applicable--Notice had to be issued within twelve months--Months means calendar months--Notice issued on 26-9-2008--Barred by limitation-- Tulsi Food Products v.Deputy CIT (All) . . . 192

S. 143(3) --Assessment--General principles--Presumption that assessment order has been passed after application of mind-- Oracle Systems Corporation v. Asst. DIT (International Taxation) (Delhi) . . . 232

S. 147 --Reassessment--Notice after four years--Failure to disclose material facts necessary for assessment--Assessment under particular provision of Double Taxation Avoidance Agreement between India and USA--Notice on the ground that different part of same provision applicable--No evidence of failure to disclose material facts--Notice not valid--Oracle Systems Corporation v. Asst. DIT (International Taxation) (Delhi) . . . 232

----Reassessment--Scope of--Effect of Explanation 3 to section 147--Reassessment of income not mentioned in notice under section 148--Such income must come to the notice of the Assessing Officer during the course of reassessment proceedings--Capital gains considered in block assessment proceedings under section 158BC prior to initiation or reassessment proceedings--Could not be reassessed on protective basis-- Dr. Shiva Kant Mishra v. CIT (All) . . . 257

----Reassessment--Writ--Validity of reassessment--Assessee participating in reassessment proceedings--Alternative remedy of appeal available against order of reassessment--Writ would not issue to quash reassessment-- Mobis India Ltd. v. Deputy CIT (LTU) (Mad) . . . 170

S. 148 --Reassessment--Notice after four years--Failure to disclose material facts necessary for assessment--Assessment under particular provision of Double Taxation Avoidance Agreement between India and USA--Notice on the ground that different part of same provision applicable--No evidence of failure to disclose material facts--Notice not valid--Oracle Systems Corporation v. Asst. DIT (International Taxation) (Delhi) . . . 232

----Reassessment--Scope of--Effect of Explanation 3 to section 147--Reassessment of income not mentioned in notice under section 148--Such income must come to the notice of the Assessing Officer during the course of reassessment proceedings--Capital gains considered in block assessment proceedings under section 158BC prior to initiation or reassessment proceedings--Could not be reassessed on protective basis-- Dr. Shiva Kant Mishra v. CIT (All) . . . 257

----Reassessment--Writ--Validity of reassessment--Assessee participating in reassessment proceedings--Alternative remedy of appeal available against order of reassessment--Writ would not issue to quash reassessment-- Mobis India Ltd. v. Deputy CIT (LTU) (Mad) . . . 170

S. 192 --Deduction of tax at source--Hospital--Payments whether salary or professional charges--Professional doctors not entitled to benefits allowed to salaried doctors--Not employees of hospital but independent professionals--Payments to doctors not salary but professional charges and tax deductible at source accordingly-- CIT (TDS) v. Ivy Health Life Sciences Pvt. Ltd. (P&H) . . . 242

S. 194J --Deduction of tax at source--Hospital--Payments whether salary or professional charges--Professional doctors not entitled to benefits allowed to salaried doctors--Not employees of hospital but independent professionals--Payments to doctors not salary but professional charges and tax deductible at source accordingly-- CIT (TDS) v. Ivy Health Life Sciences Pvt. Ltd. (P&H) . . . 242

S. 195 --Non-resident--Taxability in India--Deduction of tax at source--Penalty paid to Government of U. S. A. pursuant to order of court in U. S. A. for violations of securities law in that country--No tax liability--No tax required to be deducted at source-- Satyam Computer Services Ltd., In re (AAR). . . 189

S. 201(1) --Deduction of tax at source--Hospital--Payments whether salary or professional charges--Professional doctors not entitled to benefits allowed to salaried doctors--Not employees of hospital but independent professionals--Payments to doctors not salary but professional charges and tax deductible at source accordingly-- CIT (TDS) v. Ivy Health Life Sciences Pvt. Ltd. (P&H) . . . 242

S. 201(1A) --Deduction of tax at source--Hospital--Payments whether salary or professional charges--Professional doctors not entitled to benefits allowed to salaried doctors--Not employees of hospital but independent professionals--Payments to doctors not salary but professional charges and tax deductible at source accordingly-- CIT (TDS) v. Ivy Health Life Sciences Pvt. Ltd. (P&H) . . . 242

S. 245C --Settlement of cases--Application for settlement of case--Application by person related to applicant--Meaning of “related party†--Effect of Explanation to section 245C(1)--Company would be a related party only if a director of such company has a substantial interest in applicant--Substantial interest should be held directly--Clubbing of shares not permitted-- Rockland Hotels Ltd. v. ITSC, Principal Bench (Delhi) . . . 197

S. 246A --Reassessment--Writ--Validity of reassessment--Assessee participating in reassessment proceedings--Alternative remedy of appeal available against order of reassessment--Writ would not issue to quash reassessment-- Mobis India Ltd. v. Deputy CIT (LTU) (Mad) . . . 170

S. 260A --Appeal to High Court--Limitation--Application for condonation of delay--No reasonable explanation for delay--Delay could not be condoned-- CIT v. Arvinder Singh(Delhi) . . . 179

----Appeal to High Court--Powers of High Court--High Court has power to consider substantial question of law relating to issue not raised before or considered by Tribunal-- B. J. Services Co. Middle East Ltd. v. Asst. CIT (Uttarakhand) . . . 138

----Appeal to High Court--Substantial questions of law--Exemption--Educational institution--Assessee running two institutions in same premises--Whether composite aggregate income to be segregated--Depends upon status and legal identities--Distinction between two institutions to be considered on basis of recognition--Whether institution established under Societies Registration Act, 1860 to be seen--No examination of status of institution and its annual receipts--No finding whether during assessment year whether there was separate inter college--Substantial questions of law arise-- CIT (Exemption) v. Chironji Lal Virendra Pal Saraswati Shiksha Parishad (All) . . . 265

S. 271(1)(c) --Penalty--Concealment of income or furnishing of inaccurate particulars thereof--Amount paid to foreign company--No deduction of tax at source on basis of certificate issued by chartered accountant--No violation of provision of Chapter XVII-B attracting disallowance under section 40(a)(ia)--Failure to deduct tax at source--Not a case of furnishing of inaccurate particulars or concealment of income--Penalty could not be levied-- CIT v. Filtrex Technologies P. Ltd. (Karn) . . . 222

S. 292B --Assessment--Amalgamation--Assessee amalgamated with successor company--Assessment proceedings with non-existent assessee--Not valid--Department not entitled to benefit of section 292B-- CIT v. Intel Technology India Pvt. Ltd. (Karn) . . . 272