Monthly Archives: August 2015

section 40(a)(i) No TDS Disallowance if Expenses Capitalised

By | August 29, 2015

Q : Whether the Expenses capitalized  in the books of account and on which no TDS has been deducted can be disallowed under section 40(a)(i)? The provisions of section 40(a) is only an additional measure to enforce the compliance of Chapter XVII-B, by disallowing an expenditure which is otherwise allowable under the provisions of the Act.… Read More »

PUBLIC HOLIDAY FOR BANKS ON SECOND AND FOURTH SATURDAY OF MONTH

By | August 27, 2015

SECTION 25 OF THE NEGOTIABLE INSTRUMENTS ACT, 1881 – WHEN DAY OF MATURITY IS A HOLIDAY – DECLARATION OF SECOND AND FOURTH SATURDAY OF EVERY MONTH AS PUBLIC HOLIDAY FOR BANKS IN INDIA NOTIFICATION NO. SO 2285 [F.NO.4/1/7/2015-IR], DATED 20-8-2015 In exercise of the powers conferred by section 25 of the Negotiable Instruments Act, 1881… Read More »

Income from renting of warehouse is business income

By | August 27, 2015

Q  Whether income from renting of warehouse and godowns was chargeable under head Income from business ? A perusal of the profit and loss account of the assessee-company and the objects clause of the memorandum of association of the company clearly show that the assessee-company was incorporated with an object of carrying on the business of… Read More »

SEBI Guidance note on Insider Trading

By | August 26, 2015

Guidance Note on SEBI (Prohibition of Insider Trading) Regulations, 2015 [August 24th, 2015] SEBI (Prohibition of Insider Trading) Regulations, 2015 (“the Regulations”) were notified vide notification dated 15th January, 2015. The regulations came into effect from May 15th, 2015. Subsequently SEBI received certain queries from the market participants seeking guidance on the interpretation of some… Read More »

section 40(a)(ia) No disallowance of expense if Income is Exempt

By | August 26, 2015

Section 40(a)(ia) No disallowance of expense if Income is Exempt Q When the income of the Assessee is exempt, Whether any disallowance of expenses under section 40(a)(ia) can be made for non deduction of TDS ? Assessee’s total income is exempt under section 10(26), for assessee’s lapse of not complying with his tax withholding obligations,… Read More »

Service tax on preparation of mid day meals for school

By | August 25, 2015

Service tax on preparation of mid day meals for school Q : Whether activity of preparing and supplying meals for midday scheme from owned premises without actual serving of food at schools would  be covered by the definition of taxable service under Section 65(106)(zzt) ? Preparation of cooked food at owned premises and supply thereof to schools… Read More »

Damage awarded by Trial Court for Specific performance

By | August 24, 2015

Damage awarded by Trial Court for Specific performance Q  What is the Taxability of damage awarded by Trial Court for Specific performance  ? Section 4, read with section 263 of the Income-tax Act, 1961 Subject :  Changeability of Income received as  Damages Assessment year 1995-96 Assessee had entered into an oral agreement with ECL  to… Read More »

Premium received by society on transfer of plot Not Taxable

By | August 23, 2015

Premium received by society on transfer of plot Q :Whether premium collected by Society collected on transfer of plots is a capital Receipt and hence not taxable ? Section 4 of the Income-tax Act, 1961  Subject: Whether Income on Transfer of plots is Capital reciept or revenue reciept Assessment year 1986-87 Facts of the case : Assessee co-operative… Read More »

TDS on Provision for Expenses

By | August 23, 2015

TDS on Provision for Expenses Q : Whether there is TDS on Provision for Expenses created in the books ? For TDS on Provision for Expenses we have to read Section 190, with sections 4, 40(a)(i), 40(a)(ia) and 201, of the Income-tax Act, 1961 Subject : Deduction of tax at source /Suspense acccount Assessment years 2006-07… Read More »

Amount of Shares Received for Non Compete fee not taxable

By | August 23, 2015

Amount of Shares Received for Non Compete fee not taxable Q Where as per the agreement between the parties consideration was in respect of two independent assets negative covenant in and shares, Whether shares received for negative covenant are capital receipt and hence not taxable ? Section 4, read with section 48, of the Income-tax Act,… Read More »

Expenses for Removal of illegal encroachments is revenue Expense

By | August 22, 2015

Expenses for Removal of illegal encroachments Q Whether expenditure to be incurred in removal of encroachments in and around the technical area of the Airport which was necessitated out of safety and security consideration in the normal course of business of authority enjoined with the responsibilities of maintenance and operation of airports all over India is… Read More »

No recovery during pendency of adjudication

By | August 22, 2015

No recovery during pendency of adjudication Q ; Whether recovery can be made if the adjudication proceedings are pending ? Service Tax : During pendency of adjudication proceedings, only provisional attachment under section 73C (service tax) can be made; recovery under section 87 would apply only after adjudication order is passed under section 73 Section 87,… Read More »

Payment banks Questions and Answers

By | August 22, 2015

How payment banks will affect our life ? On August 19, 2015 the RBI had granted in principle approval to 11 entities for establishment of payment banks, which include established ones like Reliance Industries, Aditya Birla, Tech Mahindra, Airtel and Vodafone. The ‘in-principle’ approval shall be valid for a period of 18 months during which… Read More »

Packaging of fertilizer not liable to service tax

By | August 22, 2015

Packaging of fertilizer not liable to service tax Q : Whether Packaging of fertilizer is liable to service-tax ? Since fertiliser cannot be marketed without packaging, packaging of fertiliser as per Fertiliser (Control) Order, 1985 would be an integral part of manufacture and, therefore, it would not be taxable under Packaging Activity Services CESTAT, MUMBAI BENCH New… Read More »

COMPANIES INDIAN ACCOUNTING STANDARDS RULES 2015

By | August 22, 2015

COMPANIES INDIAN ACCOUNTING STANDARDS RULES 2015 COMPANIES (INDIAN ACCOUNTING STANDARDS) RULES, 2015 NOTIFICATION [F.NO.01/01/2009/CL-V(PART)], DATED 16-2-2015 In exercise of the powers conferred by section 133 read with section 469 of the Companies Act, 2013 (18 of 2013) and sub-section (1) of section 210A of the Companies Act, 1956 (1 of 1956), the Central Government, in consultation with the… Read More »

Ind AS 2 (Indian Accounting Standard )

By | August 22, 2015

COMPANIES (INDIAN ACCOUNTING STANDARDS) RULES, 2015 NOTIFICATION [F.NO.01/01/2009/CL-V(PART)], DATED 16-2-2015 They shall come into force on the 1st day of April, 2015 Indian Accounting Standard (Ind AS 2) Inventories (This Indian Accounting Standard includes paragraphs set in bold type and plain type, which have equal authority. Paragraphs in bold italic type indicate the main principles.)… Read More »

Oral partition of property not justified

By | August 22, 2015

Q; Can the Assessee claim that there was oral partition of Property and hence capital gains should be apportioned among the members ? Assessee filed his return of income declaring certain capital gains apportioned amongst himself and his three sons stating that there was an oral partition  Assessing Officer completed assessment accepting income declared by… Read More »

Foot over bridges and bus shelters are parts of infra facility

By | August 22, 2015

Construction of foot over bridges and bus shelters are parts of infra facility for claiming section 80IA Deduction Q : Whether bus shelters  are part of a highway project as per clause (b) of the Explanation? yes  Construction of foot over bridges and bus shelters are parts of infra facility for claiming section 80IA Deduction Facts… Read More »

When Income declared after search was not undisclosed

By | August 21, 2015

Income declared after search was not undisclosed if covered by advance tax and TDS Q;  Assessee declared certain income in belated return  after date of search. Whether such income can be treated as undisclosed ? Section 158B(b), read with section 139, of the Income-tax Act, 1961 Subject :Income declared in belated return in Block assessment in search… Read More »

scientific Research expenditure can not be deferred

By | August 21, 2015

scientific Research expenditure can not be deferred Q  Whether  scientific Research expenditure can be deferred and claimed as deferred revenue expenditure over the succeeding years? There is no provision under section 35 which provides for allowance of deferred research expenses u/s 35 expenditure Facts of the Case Section 35 of the Income-tax Act, 1961 Issue… Read More »

Exchange Rate for conversion of foreign currency wef 21 August 2015

By | August 21, 2015

Exchange Rate for conversion of foreign currency wef 21 August 2015 GOVERNMENT OF INDIA MINISTRY OF FINANCE (DEPARTMENT OF REVENUE) (CENTRAL BOARD OF EXCISE AND CUSTOMS) Notification No. 81/2015 – Customs (N.T.) Dated the 20th August, 2015 In exercise of the powers conferred by section 14 of the Customs Act, 1962 (52 of 1962), and… Read More »

CENVAT credit on Capital Goods when depreciation on duty element reversed in revised ITR

By | August 20, 2015

CENVAT credit on Capital Goods when depreciation on duty element reversed in revised ITR Q: Whether CENVAT credit on Capital Goods will be allowed if depreciation claimed on duty element has been reversed in the revised  income tax return ? Where depreciation was originally claimed on duty paid on capital goods  but, later revised return… Read More »

Delay in filing appeal against auction

By | August 20, 2015

Q: When will  Delay in filing appeal against auction be condoned? SARFAESI : Where respondent-bank had neither published an auction notice in newspaper in respect of auction of property of which petitioner was joint owner nor had bank served a personal notice on petitioner in respect of same, there was no occasion for petitioner to… Read More »

Interest on loan from Debtor disallowed

By | August 20, 2015

Q : When will Interest on loan from Debtor disallowed? Where assessee-company received loan of certain sum from its holding company, ‘F’ and claimed interest on said loan, since ‘F’ was a debtor of assessee-company of more than double amount of loan, allowance of deduction was amount to diversion of income of assessee-company; interest paid… Read More »

when registration under section 12A can be denied to school

By | August 20, 2015

Q : when registration under section 12A can be denied to school? Assessee-trust filed an application for registration under section 12A and claimed exemption on ground that school ran by it was imparting education and, therefore, trust was meant for charitable purpose . Commissioner made an enquiry and was of opinion that assessee intended to… Read More »