Category Archives: Income Tax Judgments

Amount received for providing training services not “fees for technical services”

By | June 15, 2018

Amount received for providing training services not “fees for technical services” under treaty with the Netherlands: The Mumbai Bench of the Income-tax Appellate Tribunal held that consideration received by the taxpayer for providing training services and for access to a centralised reservation system (that is, common facilities provided to members of the taxpayer group) were… Read More »

Share premium received from foreign holding companies not income chargeable to tax

By | June 15, 2018

Share premium received from foreign holding companies not income chargeable to tax The Mumbai Bench of the Income-tax Appellate Tribunal held that a share premium received by the taxpayer from its non-resident holding company was a capital transaction and, thus, not income chargeable to tax in India. The case is: Finproject India (P.) Ltd. Read a June… Read More »

Expenses incurred to improve quality of existing product allowed : GUJARAT HC

By | June 5, 2018

what emerges is that the assessee who was engaged in manufacturing textile products, had expended the amount in question for product development undertaken by a sister concern of the assessee on its behalf. The research work did not involve development of a new product or even a new technique or technology to manufacture existing product… Read More »

Encashment of bank guarantee for non performance allowed as exp. :ITAT Delhi

By | June 5, 2018

Issue involved in this appeal is whether the bank guarantee encashed by the Delhi transport Corporation on the facts submitted above is an allowable expenditure or not or is allowable to the assessee under section 28 of the income tax act or not. Held The above loss because of an event of the bank guarantee… Read More »

60% depreciation allowed on Printer being part of computer system : Madras HC

By | June 5, 2018

Paragraph 6 of the order passed by the Commissioner of Income Tax (Appeals), it has been stated that it can be inferred that the machines “computer printers” under consideration can either be called computers-printers, since a lot of independent functions done by the computers are done by these printers and they can be called an… Read More »

Taxability of gift of shares to “sister concern” under family realignment

By | June 2, 2018

Taxability of gift of shares to “sister concern” under family realignment The Delhi Bench of the Income-tax Appellate Tribunal addressed the taxability of a gift of shares to a sister concern under a family realignment “without consideration.” The case is: Gagan Infraenergy Ltd. Read a May 2018 report[PDF 423 KB] Read KPMG Report   Income Tax on… Read More »

Deduction allowed for payment to sugarcane grower in excess of administered price : HC

By | May 30, 2018

Mere use of the word “advance” in the letter of the Sugarcane Growers Association by itself would not change the character of the payment, especially when the amount paid was an ascertained liability and the assessee was following mercantile system of accounting and the payment was also done during the relevant accounting year. Furthermore, the… Read More »

No Tax on sum received by partner on retirement from firm for goodwill : HC

By | May 25, 2018

HIGH COURT OF BOMBAY Principal Commissioner of Income-tax-26 Mumbai v. R.F. Nangrani HUF M.S. SANKLECHA AND SANDEEP K. SHINDE, JJ. IT APPEAL NO. 33 OF 2016 APRIL  18, 2018 A.R. Malhotra and N.A. Kazi for the Appellant. Ajaykumar R. Singh and Ravindra Poojary for the Respondent. ORDER 1. This Appeal under Section 260-A of the Income Tax Act, 1961 (the Act) challenges the order dated… Read More »

Determining when legislative changes apply retrospectively: Analysis

By | May 25, 2018

Determining when legislative changes apply retrospectively Case Law : Calcutta Export Company (Civil Appeal No 4339-4340 of 2018) The Supreme Court of India held that when the amount of withheld tax is remitted to the government after the end of the financial year but before the due date for filing the tax return, a legislative… Read More »

Payments for marketing and distribution rights is taxable royalty : ITAT

By | May 24, 2018

Payments for marketing and distribution rights held taxable royalty The Bangalore Bench of the Income-tax Appellate Tribunal held that payments for marketing and distribution rights of an “adwords” program were taxable as income. Under the adwords program’s distribution and service agreements, the taxpayer was licensed to use certain confidential information, technical know-how, trade mark, brand… Read More »

No reassessment on basis of objections raised by audit party : Bombay HC : Dated 24.04.2018

By | May 23, 2018

 The reasons recorded in support of the impugned notice was merely on the basis of borrowed satisfaction of the audit party. This also makes the impugned notice bad. HIGH COURT OF BOMBAY Commissioner of Income-tax-14, Mumbai v. Shankardas B. Pahajani M.S. SANKLECHA AND SANDEEP K. SHINDE, JJ. IT APPEAL NO. 1432 OF 2007 APRIL  24, 2018 P.C.… Read More »

Notice not served to all legal representatives to initiate reassessment proceedings against deceased person : ITAT

By | May 21, 2018

The rights and interest of the LRs in the estate of the deceased cannot be taken away from them without giving them a proper opportunity of defending their rights and interest, in accordance with the natural justice principle of audi alterem partem, as held in ‘Umedram’ It is held that the initiation of reassessment proceedings, in the… Read More »

Gift received by individual from his HUF not exempt under Income Tax : ITAT

By | May 15, 2018

HUF does not come under specified category of relative under section 56(2)(vii), Explanation (e); therefore, money received by an individual from HUF as gift would not considered as valid gift IN THE ITAT AHMEDABAD BENCH ‘D’ Gyanchand M. Bardia v. Income Tax Officer, Ward 1(2)(2), Ahmedabad S.S. GODARA, JUDICIAL MEMBER AND AMARJIT SINGH, ACCOUNTANT MEMBER IT… Read More »

Deposits in Bank from Credit card Withdrawal : No Penalty : ITAT

By | April 26, 2018

ITAT Kolkata Sri Joy Barman Vs. Income Tax Officer ITA No. 599-600/Kol/2016 Date of Judgement/Order : 07/02/2018 FULL TEXT OF THE ITAT ORDER IS AS FOLLOWS:- The above two captioned appeals are pertaining to the same assessee for assessment years 2008-09 & 2009-10. Since these appeals belong to the same assessee, therefore these have been… Read More »

Depreciation on Road constructed on BOT basis allowed as Intangible asset : ITAT

By | April 18, 2018

IN THE ITAT HYDERABAD BENCH (SPECIAL BENCH) Assistant Commissioner of Income-tax, Circle-16(2), Hyderabad v. Progressive Constructions Ltd. D. MANMOHAN, VICE-PRESIDENT J. SUDHAKAR REDDY, ACCOUNTANT MEMBER SAKTIJIT DEY, JUDICIAL MEMBER IT APPEAL NO. 1845 (HYD.) OF 2014 C.O. NO. 36 (HYD.) OF 2015 [ASSESSMENT YEAR 2011-12] FEBRUARY  14, 2017 J.V. Prasad, Sr. Standing Counsel for the Appellant. V.… Read More »

Apply TDS u/s 194J on provision for Audit Fees :ITAT Chennai

By | April 17, 2018

On perusal of section 194J of the Act, we find that tax is deductible at source either at the time of credit of expenditure to the account of the payee or at the time of payment whichever is earlier. In the instant case, the assessee had made provision for audit fees to the account of… Read More »

No Reassessment to verify bank account of assessee if already reflected in ITR : HC

By | April 16, 2018

HIGH COURT OF GUJARAT Sunrise Education Trust v. Income-tax officer (Exemption) AKIL KURESHI AND B.N. KARIA, JJ. SPECIAL CIVIL APPLICATION NO. 16726 OF 2017 FEBRUARY  19, 2018 Ms. Vaibhavi K. Parikh, Advocate for the Petitioner. Mrs. Mauna M. Bhatt, Advocate for the Respondent. ORDER   Akil Kureshi, J. – Petitioner has challenged a Notice dated 31st March 2017 issued by the respondent-Assessing Officer… Read More »

Notice u/s 148 cannot be issued if time to issue notice u/s 143 (3) not expired

By | April 13, 2018

ITAT Hyderabad Venkata Siva Reddy Nellore Vs ITO  Appeal Number : ITA No. 962/HYD/2017 Date of Judgement/Order : 22/11/2017 FULL TEXT OF THE ITAT JUDGMENTThis is an appeal by assessee against the order of the Commissioner (Appeals)-Tirupati, dated 30-3-2017, for the assessment year 2012-13.2. The grounds raised by assessee are as under :– “1. The… Read More »

CBDT instructions on seizure of jewellery & ornaments are discretionary

By | April 10, 2018

CBDT instructions on seizure of jewellery and ornaments are discretionary ITAT Indore Shri Keshav Lila Vs. Assistant Commissioner of Income Tax-1(2)  ITA No. 935/Ind/2016 Date of Judgement/Order : 19/01/2018 Related Assessment Year : 2011-12 CBDT instructions which in our view provides a guideline to the search conducting team that no seizure should be made of… Read More »

No reassessment because ITR not reflecting in IT system of dept. if it was filed manually by assessee

By | April 9, 2018

IN THE ITAT JAIPUR BENCH Narain Dutt Sharma v. Income-tax Officer, Ward- 6 (1), Jaipu VIJAY PAL RAO, JUDICIAL MEMBER AND VIKRAM SINGH YADAV, ACCOUNTANT MEMBER IT APPEAL NO. 203 (JP.) OF 2017 [ASSESSMENT YEAR 2007-08] FEBRUARY  7, 2018 P.C. Sharma and Prashant Sharma, Advs. for the Appellant. Ajay Malik (Addl. CIT) for the Respondent. ORDER   Vikram Singh Yadav, Accountant Member –… Read More »

Basement is part of residential house; eligible for Sec. 54/54F : ITAT

By | April 6, 2018

IN THE ITAT MUMBAI BENCHES ‘J’ Assistant Commissioner of Income-tax Circle-16(1) Mumbai v. Shrey Sharma Guleri Prime Channel Software Communications (P.) Ltd. JOGINDER SINGH, JUDICIAL MEMBER AND N.K. PRADHAN, ACCOUNTANT MEMBER IT APPEAL NO. 6147 (MUM.) OF 2016 [ASSESSMENT YEAR 2009-10] MARCH  22, 2018 Saurabh Rai for the Revenue. Dilip V. Lakhani for the Assessee. ORDER   Joginder Singh,… Read More »

Amount paid by Prasar Bharati to advertising agencies liable to TDS u/s Sec. 194H TDS: SC

By | April 4, 2018

SUPREME COURT OF INDIA Director, Prasar Bharati v. Commissioner of Income-tax, Thiruvananthapuram R.K. AGRAWAL AND ABHAY MANOHAR SAPRE, JJ. CIVIL APPEAL NOS. 3496-3497 OF 2018 APRIL  3, 2018 JUDGMENT Abhay Manohar Sapre, J. – Delay condoned. 2. Leave granted. 3. These appeals are directed against the final judgment and order dated 20.11.2009 passed by the High Court of Kerala at… Read More »

Commission paid to NR for services rendered outside India not liable to tax even after withdrawal of Circular No. 23

By | April 3, 2018

IN THE ITAT AGRA BENCH Assistant Commissioner of Income-tax, Circle-1, Agra v. Nuova Shoes A.D. JAIN, JUDICIAL MEMBER AND DR. MITHA LAL MEENA, ACCOUNTANT MEMBER IT APPEAL NO. 435 (AGRA) OF 2015 [ASSESSMENT YEAR 2010-11] SEPTEMBER  28, 2017 Waseem Arshad, Sr. Dr. for the Appellant. Saheb P. Satsangee, C.A. for the Respondent. ORDER   A.D. Jain, Judicial Member – This… Read More »

No TDS on reimbursement of expenses if it had no income element: HC

By | April 3, 2018

No TDS on reimbursement of expenses if it had no income element: HC if no income is attributable to the payee, there is no liability to deduct tax at source in the hands of the tax deductor. HIGH COURT OF KARNATAKA Commissioner of Income Tax v. Kalyani Steels Ltd. MRS. S. SUJATHA AND JOHN MICHAEL CUNHA, JJ.… Read More »

Delay in filing ITR due to not getting NOC from erstwhile auditor condoned : HC

By | April 2, 2018

HIGH COURT OF MADRAS REGEN Powertech (P.) Ltd. v. Central Board of Direct Taxes, New Delhi M. DURAISWAMY, J. W.P. NO. 24273 OF 2016 MARCH  28, 2018 Vijaya Narayanan, Sr. Counsel and R. Sivaraman for the Petitioner. Mrs. Hema Muralikrishnan, Sr. Standing Counselfor the Respondent. ORDER 1. The petitioner has filed the above Writ Petition to issue a writ of… Read More »

Delay in filing ITR to be condoned for HUF if same was allowed to Karta in identical circumstances: HC

By | April 2, 2018

HIGH COURT OF GUJARAT Sahebsingh Bindrasingh Senagar (HUF) v. Chief Commissioner of Income-tax-1 AKIL KURESHI AND B.N. KARIA, JJ. SPECIAL CIVIL APPLICATION NO. 21411 OF 2017 FEBRUARY  21, 2018 Hardik V. Vora, Adv. for the Petitioner. Mrs. Mauna M. Bhatt, Adv. for the Respondent. JUDGMENT   Akil Kureshi, J. – The petitioner has challenged an order dated 1.8.2017 passed by the Chief… Read More »

No penalty if Income Tax notice didn’t specify concealment or furnishing inaccurate income

By | March 28, 2018

Issue A copy of the show cause notice u/s 274 of the Act was filed before us and perusal of the same reveals that AO has not struck out the irrelevant portion in the show cause notice The same is reproduced for the purpose of ready reference: “Have concealed the particulars of your income or… Read More »

Income from letting out warehouse for short duration was business income

By | March 27, 2018

As per the Hon’ble Madras High Court, the income earned from letting-out of warehouse and godown was chargeable under the head ‘income from business’ having regard to the facts and circumstances of the case. In the case before the Hon’ble High Court, assessee was engaged in the business of warehousing, handling and transport business and… Read More »

How to Tax Gifts received by ‘Mayawati ‘ – Politician : Explained by ITAT

By | March 26, 2018

[2010] 42 SOT 59 (DELHI) IN THE ITAT DELHI BENCH ‘E’ Deputy Commissioner of Income-tax, Central Circle-11, New Delhi v. Mayawati R.P. TOLANI, JUDICIAL MEMBER AND SHAMIM YAHYA, ACCOUNTANT MEMBER IT APPEAL NOS. 4259/DELHI/2007 AND 2078 & 2079/DELHI/2009 AUGUST 27, 2010 S.D. Kapila and R.R. Maurya for the Appellant. Dr. Rakesh Gupta, Dr. R.K. Agarwal, Ashwani Taneja and Tarun Kumar for the… Read More »

Gifts/Prizes/Awards/Rewards received by sportsman not taxable if he is not professional

By | March 26, 2018

IN THE ITAT DELHI BENCH ‘A’ Abhinav Bindra v. Deputy Commissioner of Income-tax, Central-2, Dehradun G.D. AGRAWAL, VICE-PRESIDENT AND R.P.TOLANI, JUDICIAL MEMBER IT APPEAL NO. 2219 (DELHI) OF 2013 [ ASSESSMENT YEAR 2009-10 ] JULY  26, 2013 Ashwani Kumar for the Appellant. Bhim Singh for the Respondent. ORDER G.D. Agrawal, Vice-President – This appeal by the assessee is directed against… Read More »

Court cannot go into sufficiency of reasons for special audit : High Court

By | March 26, 2018

HIGH COURT OF KARNATAKA Habitat Shelters (P.) Ltd. v. Principal Commissioner of Income Tax, Bangalore DR. VINEET KOTHARI, J. WRIT PETITION NO. 2009 OF 2018 (T – RES) FEBRUARY  12, 2018 Anirudha R.J. Nayak, Adv. for the Petitioner. ORDER   1. The petitioner-M/s.Habitat Shelters Private Limited has filed this Writ Petition aggrieved by the directions of holding… Read More »

Expenses for property taxable as house property income couldn’t be allowed as business exp. : ITAT

By | March 25, 2018

IN THE ITAT KOLKATA BENCH ‘D’ Mangilall Estates (P.) Ltd. v. Deputy Commissioner of Income tax, Central Circle-1(3), Kolkata ABY T. VARKEY, JUDICIAL MEMBER AND WASEEM AHMED, ACCOUNTANT MEMBER IT APPEAL NO. 156 (KOL.) OF 2015 [ASSESSMENT YEAR 2012-13] FEBRUARY  21, 2018 Subash Agarwal, Adv. for the Appellant. A.K. Tiwari, CIT-DR for the Respondent. ORDER Waseem Ahmed, Accountant Member –… Read More »

Gift from relative , No need to prove occasion : Sec. 68 additions deleted by HC

By | March 20, 2018

HIGH COURT OF HYDERABAD Pendurthi Chandrasekhar v. Deputy Commissioner of Income tax C.V. NAGARJUNA REDDY AND CHALLA KODANDA RAM, JJ. IT APPEAL NOS. 701 AND 702 OF 2016 FEBRUARY  23, 2018 JUDGMENT C.V. Nagarjuna Reddy, J.— As the parties to these appeals are common and the subject matter is connected in both the cases, though not identical,… Read More »

Advance tax couldn’t be treated as tax paid under PMGKY : Delhi HC

By | March 15, 2018

HIGH COURT OF DELHI Virag Tiwari v. Principal Commissioner of Income-tax SANJIV KHANNA AND MS. PRATHIBA M. SINGH, JJ. WRIT PETITION (CIVIL) NO. 6312 OF 2017 MARCH  12, 2018 Balbir Singh, Sr. Adv. Rajesh Jain and Ms. Rubal Bansal, Advs. for the Petitioner. Zoheb Hossain, Sr. Standing Counselfor the Revenue. ORDER Sanjiv Khanna, J. – The writ petitioner, an advocate by profession and… Read More »

CBDT Circular are Binding on Revenue (Income Tax Department officers)

By | March 11, 2018

CBDT Circular are Binding on Revenue  J.C.I.T. Vs. M/s. Celica Developers Pvt. Ltd. (ITAT Kolkata) Appeal Number : ITA No. 658/Kol/2016 Date of Judgement/Order : 21/11/2017 Related Assessment Year : 2007- 08 Summary of Decision : J.C.I.T. Vs. M/s. Celica Developers Pvt. Ltd. (ITAT Kolkata) It is a settled law that the Circulars issued by CBDT… Read More »

No penalty u/s 221 be levied for non-payment of self-assessment tax by assessee : Mumbai ITAT

By | February 28, 2018

IN THE ITAT MUMBAI BENCH ‘A’ Heddle Knowledge (P.) Ltd. v. Income Tax Officer, Ward- 8 (1) (4), Mumbai G.S. PANNU, ACCOUNTANT MEMBER AND RAM LAL NEGI, JUDICIAL MEMBER IT APPEAL NO. 7509 (MUM.) OF 2011 [ASSESSMENT YEAR 2009-10] JANUARY  19, 2018 Pavan Ved for the Appellant. Rajesh Kumar Yadav for the Respondent. ORDER G.S. Pannu, Accountant Member – The… Read More »

Film Projector could not be treated as computer for charging depreciation : ITAT

By | February 28, 2018

Issue Assessing Officer in disallowing the claim of Depreciation amounting to Rs. 91,87,713/- on the alleged plea that the Film Projector is to be depreciated @ 15% instead of 60%, IN THE ITAT MUMBAI BENCH ‘SMC’ Cinetech Entertainment India (P.) Ltd. v. Income Tax Officer, Ward- 16 (1) (1), Mumbai SHAMIM YAHYA, ACCOUNTANT MEMBER IT… Read More »

Salary paid in India to employee deputed abroad not taxable in India : AAR

By | February 26, 2018

The applicant has posed the following questions, seeking a ruling from this Authority: (i) Based on the above facts, Salary paid by the applicant to the assignee, Mr. T.N. Santhosh Kumar in India, is not liable to be taxed in India in FY 2011-12 having regard to the provisions of the Act and the relevant… Read More »

No Recovery proceedings before expiry of limitation period to file appeal before ITAT : HC

By | February 21, 2018

[2018] 22122017 TaxHeal.com 21022018 income tax HIGH COURT OF MADRAS Rapid Care Transcription (P.) Ltd. v. Income Tax Officer, Corporate Ward 5(4), Chennai T. S. SIVAGNANAM, J. WRIT PETITION NO. 33765 OF 2017 W.M.P NOS. 37408 AND 37410 OF 2017 DECEMBER  22, 2017 K. Jayachandran for the Petitioner. Mrs. Hema Muralikrishnan, Sr. Standing Counsel for the Respondent. ORDER 1. Heard… Read More »

Jewellery disclosed in regular return : No addition to income : Judgment

By | January 8, 2018

Issue CIT(A) confirmed addition of Rs. 22,57,632 on account of jewellery u/s. 69A of the Income Tax Act, 1961.  Held CBDT Instruction 1916 dated 11-05-1994 “Instances of seizure of jewellery of small quantity in the course of operation under section 132 have come to the notice of the Board. The question of a common approach… Read More »

Transferring Income Tax Case of Assessee to different officer : Hearing opportunity to Assessee not required

By | December 26, 2017

Held This Court has found that there has been an agreement between the two Heads of Department and the petitioner cannot plead for an opportunity to be granted before an order of transfer, as there is no such statutory requirement under the Act, rather, the said procedure has been specifically excluded. [ 2017 ] 05122017… Read More »

Subsidy scheme incentive for Multiplex Theatre held as Capital receipts : Supreme Court

By | December 26, 2017

Held The subsidy scheme in the West Bengal case is similar to the scheme in the Maharashtra case being to encourage development of Multiplex Theatre Complexes which are capital intensive in nature, and since the subsidy scheme in that case is also similar to the Maharashtra cases, in that the amount of entertainment tax collected… Read More »

Linking of Aadhaar with mobile no. & opening of Bank Account : Supreme Court Extended timelines

By | December 26, 2017

SC extends deadline for linking of Aadhaar with mobile no. & opening of Bank Accout till 31.03.2018 REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL ORIGINAL JURISDICTION WRIT PETITION (CIVIL) NO 494 OF 2012 JUSTICE K S PUTTASWAMY (RETD ) AND ANR ….. PETITIONERS Versus UNION OF INDIA AND ORS ….. RESPONDENTS WITH T C… Read More »

CBDT circular of revised limits for filing appeal applies to pending appeals also : Supreme Court

By | November 25, 2017

Issue : Instruction No.3 of 2011 dated 9.2.2011, provids for appeals not to be filed before the High Court(s) where the tax impact was less than Rs.10 lakh. The Instruction/Circular in question is stated to have a prospective effect as per the Revenue and, thus, cases which were pending in the High Court(s) and had been… Read More »

Income Tax Audit not done u/s 44AB : No penalty if assessee acted bona fide

By | November 24, 2017

Held Even though the net profit / loss arising from the purchase and sale of securities was disclosed by the assessee in the profit and loss account, the value of such securities held by the assessee was fully and truly disclosed by the assessee under the head investment in the relevant balance sheet.The said method… Read More »

Filing of manual ITR without Aadhaar number rejected by Madaras High Court

By | November 10, 2017

Held In the case of Binoy Viswam, it would clearly show that the Hon’ble Supreme Court has not stayed the Proviso to Sub-Section (2) of Section 139AA of the Act and the partial stay would be applicable only to facilitate the other transactions, which are mentioned in Rule 114B of the Rules, which pertains to transactions, in… Read More »

Delhi HC Judgment : Income Tax ICDS provisions : ultra vires

By | November 9, 2017

Income Tax ICDS provisions The Central Government cannot do what is otherwise legally impermissible. Therefore, the following provisions of ICDS are held as ultra vires and are liable to be struck down:- (1) ICDS I : It does away with the concept of ‘prudence’ and is contrary to the Act and to binding judicial precedents. Therefore, it is… Read More »

Condonation of delay in making IDS payment : CIT to dispose of application

By | October 10, 2017

HIGH COURT OF BOMBAY Sadhana Rajendra Jain v. Central Board of Direct Taxes S.C. DHARMADHIKARI AND SMT. VIBHA KANKANWADI, JJ. WRIT PETITION NO. 8066 OF 2017 AUGUST  29, 2017 Rohan Deshpande for the Petitioner. S.V. Walve for the Respondent. ORDER 1. This petition was placed before us on 14-8-2017 but due to paucity of time it could not be taken… Read More »

Son was legal representative of deceased father : Tax Recovery can be done

By | October 8, 2017

[2017] 85 taxmann.com 308 (Calcutta) HIGH COURT OF CALCUTTA Arvind Kayan v. Union of India DEBANGSU BASAK, J. WP NO. 504 OF 2017 AUGUST  30, 2017 Koushik Chowdhury, Adv. and Ms. Sumita Shaw, Adv. for the Petitioner. Kaushik Chandra, ld. ASG, Md. Nizumuddin, Adv. and Ms. Smita Das De, Adv. for the Respondent. ORDER 1. The Court : The petitioner assails an order dated… Read More »