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Direct Tax Laws
  
 SC/HC
  
 [2014] 49 taxmann.com 72 (Madras)
No penalty for taking loan in cash if impugned transaction is deemed as unexplained cash credit under sec. 68 -IT : Once certain amount was subjected to tax under section 68, question of treating it as transaction in violation of section 269SS or section 269T did not arise as it stood mutually excluded Read Morenew
  
 [2014] 49 taxmann.com 71 (Delhi)
No reassessment to tax forfeited business advance if it was treated as capital receipts in original assessment -IT: Where Assessing Officer completed assessment under section 143(3) accepting assessee's claim that amount forfeited representing non-refundable advance received from foreign company was capital receipt, he was not justified in initiating reassessment proceedings merely on basis of change of opinion that amount in question represented revenue receipts and, thus, liable to tax Read Morenew
  
 [2014] 49 taxmann.com 99 (Madras)
Small spending on charitable acts not sufficient to deny trust’s registration if it complied with all conditions -IT : Where assessee-trust satisfied requirements of Rule 17A of 1962 Rules and submitted Form No. 10A alongwith requisite documents, its claim for registration under section 12AA could not be rejected merely or ground that assessee had spent only small amount towards charitable activities Read Morenew
  
 [2014] 49 taxmann.com 100 (Kerala)[2014] 363 ITR 111 (Kerala)
High Court triggers sec. 41(1) for excess cash collected by South Indian Bank from its depositors -IT: Expenditure incurred on earning tax free bonds and dividends was to be disallowed Read Morenew
  
 [2014] 49 taxmann.com 8 (Bombay)
FTS receipts pursuant to agreements entered into prior to 1-4-1976 were exempt under proviso to sec. 9(1)(vii) -IT/ILT: Where assessee-company entered into contract with Indian companies for supply of technical know-how prior to 1-4-1976, technical services fee received by it in terms of those contracts was exempt from tax by virtue of proviso to section 9(1)(vii) Read Morenew
  
 [2014] 49 taxmann.com 104 (Gujarat)
No penalty alleging wilful default in filing return if it was filed within extended time allowed by revenue -IT: Where assessee filed its return of income within extended time period granted by revenue authorities, there being no case of wilful default in filing return within prescribed time period, impugned penalty order passed in terms of section 276CC deserved to be set aside Read More
  
 [2014] 49 taxmann.com 120 (Delhi)
Receipt of additional compensation on compulsory acquisition of capital assets is to be taxed in year of receipt -IT: Additional compensation on compulsory acquisition is to be taxed in year of receipt instead of in year of transfer of capital asset Read More
  
 [2014] 49 taxmann.com 573 (Delhi)
Fee to allow use of technology for 3 yrs without supply of know-how during that period was taxable in year of receipt -IT/ILT : Where assessee, a subsidiary of US based company, entered into an agreement during relevant year whereby it received certain amount as licence fee for granting right to use technology relating to manufacturing a particular model of tractor for three years, in view of fact that after execution of agreement, no services or know-how was to be supplied during next three years, entire licence fee was to be taxed in assessment year in question even though payment had to be deposited in escrow Read More
  
 [2014] 49 taxmann.com 103 (Bombay)
Tribunal was justified in deciding all aspects of case when SC directed it to hear matter afresh: HC -IT : Where in course of appellate proceedings, Supreme Court remanded matter back with a direction to Tribunal to hear matter afresh, in such a case, Tribunal did not commit any error in deciding all aspects of matter which were subject matter of appeal Read More
  
 [2014] 49 taxmann.com 123 (Madras)
Depreciation allowed on asset acquired under genuine sale-lease back transaction followed by payment of sales tax -IT : Transaction of sale and lease back by assessee finance company being genuine, it would be entitled to depreciation on leased out machinery Read More
  
 [2014] 49 taxmann.com 133 (Delhi)[2014] 360 ITR 351 (Delhi)
HC allowed sec. 10A relief as it was proved that receipts of arbitration award weren’t included in export proceeds -IT : Merely because payment against impugned invoice of software export was received in advance, section 10A exemption could not be denied on ground that it was an arbitration award as stamp paper purportedly for arbitration was purchased prior to raising such invoice Read More
  
 [2014] 49 taxmann.com 129 (Karnataka)[2014] 362 ITR 630 (Karnataka)[2014] 265 CTR 163 (Karnataka)
Concealment penalty rightly levied for claiming depreciation on non-existent asset: Karnataka HC -IT : Where assessee claimed depreciation on non-existent assets, penalty was to be levied for filing inaccurate particulars of income Read More
  
 [2014] 49 taxmann.com 124 (Gujarat)
HC stays recovery of tax on its partial deposit on reasoning that Excise Act grants stay on similar conditions -IT: HC stays recovery of tax on its partial deposit on reasoning that Excise Act grants stay on similar conditions Read More
  
 [2014] 49 taxmann.com 132 (Delhi)[2014] 360 ITR 182 (Delhi)
Loss arising due to share dealing wasn’t speculative if assessee had only carried out solitary transaction of shares -Solitary transaction of purchase and sale of shares in which assessee incurred loss due to fall in value of share, did not constitute assessee's business and loss could be set off against assessee's profit from other businesses Read More
  
 [2014] 49 taxmann.com 130 (SC)[2014] 268 CTR 483 (SC)
SC: HC couldn’t issue directions to CIT on issue which was already dropped and not raised by him before HC -IT : Where proceedings under section 12AA(3) had already been dropped by Commissioner and this was not an issue before High Court in writ petition, High Court was not justified in issuing direction to Commissioner to pass an order under section 12AA(3) Read More
  
 [2014] 49 taxmann.com 128 (Bombay)
Interest paid on borrowings used for investment in foreign co. disallowed as this wasn’t assessee’s business -IT : Where interest paid on borrowals utilized for investments in a foreign company was not in course of assessee's business, its claim for deduction under section 36(1)(iii) was to be rejected Read More
  
 [2014] 49 taxmann.com 136 (Karnataka)
Sec. 10(23C): Apart from annual grants, other grants are also relevant to check whole/substantial funding by Govt. -IT: Word 'wholly or substantially financed by Government' cannot be confined only to annual grants as apart from providing annual grant, if Government grants land, invests money in building and infrastructure and also running educational institution all that has to be taken into consideration to decide whether institution is wholly or substantially financed by Government in order to become eligible to claim exemption under section 10(23C)(iiiab) Read More
  
 [2014] 49 taxmann.com 515 (SC)
SC : National Tax Tribunal Act held as unconstitutional; CS ineligible to appear before National Tax Tribunal -IT : SC : National Tax Tribunal Act unconstitutional; Company Secretaries ineligible to represent parties in appeal before NTT Read More
  
 [2014] 49 taxmann.com 574 (Madras)
Now the Madras High Court directs CBDT to extend the due date for filing return to November 30, 2014 -IT/ILT : Now the Madras High Court directs CBDT to extend the due date for filing return to November 30, 2014 Read More
  
 [2014] 49 taxmann.com 144 (Calcutta)
Sec. 263 revision was valid if AO had wrongly taken threshold limit for TDS exemption as standard deduction: HC -IT : Where Assessing Officer passed assessment order taking a view that assessee was not liable to deduct tax at source under section 194C where single payment to transport contractors did not exceed Rs. 20,000, Commissioner, in exercise of revisional power, rightly set aside assessment holding that bifurcation of payments made by assessee was not permissible Read More
  
 [2014] 48 taxmann.com 361 (Bombay)
Disclosure of income in belated return not to be held as undisclosed even if return was filed after date of search -IT: Where regular return was filed within time prescribed under section 139(4) merely, because it was filed after date of search, income therein could not be treated as undisclosed income Read More
  
 [2014] 49 taxmann.com 47 (Karnataka)
Amendments to sec. 40(a)(ia) allowing deduction on payment of TDS of any month before due date has retro-effect -IT : Amendment to section 40(a)(ia) by Finance Act, 2010, which comes into effect from 1-4-2010 is curative in nature and, thus, it has retrospective operation Read More
  
 [2014] 49 taxmann.com 140 (Delhi)[2014] 362 ITR 24 (Delhi)
No reassessment if property alleged to have been acquired out of undisclosed income didn’t relate to assessee -IT : Where in course of proceedings relating to reopening of assessment, first respondent passed on order accepting assessee's objection that there was no evidence to connect him with certain properties allegedly acquired out of undisclosed income, he should have dropped reassessment proceedings and, therefore, impugned letter issued by first respondent calling upon assesee to avail of opportunity to cross examine complainant i.e. person, who was author of tax evasion petition, deserved to be qu Read More
  
 [2014] 49 taxmann.com 142 (Andhra Pradesh)
HC follows SC's ruling in Sandvik's case; directs revenue to pay compensation if payment of interest was delayed -IT : If tax, interest, penalty, etc., has been collected in excess and it is withheld beyond permissible period under Act, Revenue should compensate for same Read More
  
 [2014] 48 taxmann.com 355 (Delhi)[2014] 363 ITR 182 (Delhi)
Renovation exp. by hotel to facilitate its business was allowable as revenue exp. -IT : Where renovation expenses did not bring any new asset and same merely facilitated assessee's business, same was allowable as revenue expenditure Read More
  
 [2014] 48 taxmann.com 364 (Andhra Pradesh)
No sec. 263 revision if taxability of lease rental relating to land developed for business purposes was debatable -IT : Where lease rentals were earned from land which were developed for creating film shooting facilities/locations and it was directly, connected with main activity of assessee, i.e., development of infrastructure for shooting locations, such rental income being capital in nature could not be held income Read More
  
 [2014] 48 taxmann.com 387 (Kerala)
Imparting of training in seminary is 'education'; assessee was entitled for registration as a trust -IT : Where assessee was imparting training to students in 'Seminary', training programme undertaken by assessee was also education and, therefore, it was entitled for registration under section 12A Read More
  
 [2014] 49 taxmann.com 148 (Rajasthan)[2014] 267 CTR 73 (Rajasthan)
No further addition to be made in survey proceedings if addition was already made in original assessment -IT: Where gross receipt of assessee was enhanced in original assessment proceedings, no further addition to be made on basis of survey proceedings Read More
  
 [2014] 48 taxmann.com 335 (Allahabad)
No reassessment on basis of audit report as it couldn’t be regarded as info indicating escaped income -IT: Audit report could not be regarded as 'information' for purpose of reopening an assessment; hence reassessment proceedings initiated on basis of such audit report were illegal Read More
  
 [2014] 48 taxmann.com 354 (Delhi)[2014] 363 ITR 172 (Delhi)
HC directed revenue to lift attachment of bank accounts as ITAT had already granted stay against tax demand -IT : Where despite stay granted by Tribunal revenue attached and took away proceeds of assessee's bank account, revenue was directed to lift attachment Read More
  
 [2014] 49 taxmann.com 29 (Karnataka)[2014] 266 CTR 241 (Karnataka)
Even employee’s contributions to PF are deductible if paid by employer before due date of filing return, rules HC -IT: Contribution by employer towards provident fund means both employer's contribution and employee's contributions and if such contributions are paid before due date prescribed under section 139(1), employer shall be entitled to deductions as provided under section 36(1)(iv) Read More
  
 [2014] 49 taxmann.com 131 (Andhra Pradesh)[2014] 361 ITR 119 (Andhra Pradesh)
No TDS liability of assessee on fees charged by NR bank for ‘LOC’ if it had privity of contract with Indian Bank -IT/ILT : Where a foreign bank charged certain sum terming it as interest on an Indian bank in process of negotiating letter of credit on behalf of its customer i.e. assessee, and said bank recouped amount from assessee, in view of fact that assessee had privity of contract with Indian bank and amounts were also paid to Indian bank only, transaction in question could not be said to fall within meaning of section 195 and, therefore, assessee was not required to deduct tax at source while making pa Read More
  
 [2014] 49 taxmann.com 412 (Delhi)
Commission paid to foreign agents for procuring export orders was outside the ambit of 'FTS' -IT/ILT : Commission paid by assessee to its foreign agent for arranging of export sales and recovery of payments could not be regarded as 'fee for technical services' under section 9(1)(vii) and, thus, assessee was not liable to deduct tax at source while making said payment Read More
  
 [2014] 48 taxmann.com 288 (Delhi)[2014] 267 CTR 122 (Delhi)
HC set aside block assessment proceedings as AO failed to record satisfaction within 2 years of search -IT: Assessing Officer is bound to record satisfaction within meaning of section 158BD within two-year time period stipulated in section 158BE(1) Read More
  
 [2014] 49 taxmann.com 31 (Gujarat)
No denial of TDS credit on its non-appearance in ITD system of department if Form No. 16A was issued by payer -IT: Where deductor having deducted TDS, issued Form No. 16A, credit of same can not be denied to assessee deductee solely on ground that such credit does not appear on ITD system of department and/or same does not match with ITD system of department Read More
  
 [2014] 49 taxmann.com 33 (Jharkhand)[2014] 363 ITR 145 (Jharkhand)
Disclosure of additional income in revised return after filing of block return would attract penalty -IT: Undisclosed income disclosed by assessee after filing revised return under section 158BC, would attract penalty under section 158BFA Read More
  
 [2014] 49 taxmann.com 41 (Bombay)
Disallowance of bogus commission paid to agent in previous year could trigger reopening of cases of earlier years -IT : Where in a subsequent year procurement charges were disallowed as no services were found to have been rendered by agents, said fact would be an information for initiating reassessment proceeding of earlier years Read More
  
 [2014] 49 taxmann.com 37 (Rajasthan)[2014] 268 CTR 351 (Rajasthan)
Share transactions supported by broker's note, share certificate and demat statement couldn't be held bogus -IT: Where transaction of purchase and sale of shares were supported with broker's note, contract note, copies of share certificates and de-mat statement, transaction of shares could not be treated bogus Read More
  
 [2014] 48 taxmann.com 362 (Bombay)
AO couldn’t make disallowance by resorting to rectification proceedings for debatable issues -IT: Where rectification pertaining to computation of deduction under section 80HHC was highly debatable, rectification could not be resorted to under provisions of section 154 Read More
  
 [2014] 49 taxmann.com 30 (Bombay)[2014] 366 ITR 12 (Bombay)
ITAT allows sec. 54 relief for two flats as their layout plan indicated that both were used as a single unit -IT : Where acquisition of two flats had been done independently but eventually they were a single unit and house for purpose of residence, claim under section 54 could not be denied Read More
  
 [2014] 49 taxmann.com 371 (Bombay)
To compute ALV AO has to determine standard rent of property if it isn't fixed under Rent Control Act -IT: At the time of determining Annual Letting Value of properties, which are subject to Rent Control Act, it is the duty of AO to determine standard rent if it isn't fixed under Rent Control Legislation Read More
  
 [2014] 48 taxmann.com 381 (Karnataka)
Indexation benefit available from the year in which asset was held by previous owner to compute cost of acquisition -IT: When an asset is acquired by way of inheritance, cost of acquisition of asset should be calculated on basis of cost of acquisition to previous owner and said cost of acquisition of previous owner has to be calculated on basis of indexed cost of acquisition as provided in Explanation (3) to section 48 Read More
  
 [2014] 48 taxmann.com 356 (Punjab & Haryana)
HC disallows business expenses of ‘Liberty’ as it had already transferred its business to franchisee affiliates -IT : Where assessee had transferred its business to franchisee, assessee could no more claim any business expenditure or depreciation on expenses incurred by it Read More
  
 [2014] 48 taxmann.com 357 (SC)[2014] 266 CTR 141 (SC)
SC: Unabsorbed depreciation is to be adjusted only against export income for computing sec. 10B relief -IT : Supreme Court affirmed decision of Karnataka High Court that for purpose of exemption under section 10B, unabsorbed depreciation should be adjusted against income of export unit only and not against other income Read More
  
 [2014] 48 taxmann.com 329 (Madras)
HC stays tax demand as there was huge difference between income stated in return and assessment order -IT: Where assessee were individual assessees not running commercial business and difference between income shown in returns and assessment orders was very high, assessees were granted stay of demand subject to deposit of certain percentage of demand Read More
  
 [2014] 48 taxmann.com 328 (Gujarat)[2014] 363 ITR 322 (Gujarat)
AO couldn’t make addition of entire unaccounted sales as he could only make addition of profit component -IT: Entire unaccounted sales cannot be added to income but only net profit Read More
  
 [2014] 48 taxmann.com 353 (Madras)
HC orders partial payment of tax in installments considering the financial condition of assessee -IT : Considering assessee's request that its business was not good and it was not in a position to pay 50 per cent of total demanded tax as directed by Assessing Officer, assessee was directed to pay 25 per cent of total demanded tax in two instalments Read More
  
 ITAT
  
 [2014] 48 taxmann.com 358 (Mumbai - Trib.)
ITAT upheld penalty on Co. for claiming sec. 54 relief on sale of residential house -IT : Where AO having rejected assessee-company claim for deduction under section 54 on ground that it being a company was not eligible to claim said deduction, passed a penalty order under section 271(1)(c) for raising such a patently false claim of deduction, penalty order so passed did not require any interference Read Morenew
  
 [2014] 49 taxmann.com 139 (Jodhpur - Trib.)[2013] 157 TTJ 76 (Jodhpur - Trib.)
No penalty if estimated addition made during block assessment wasn’t based on materials found during search -IT: Where Assessing Officer passed penalty order under section 158BFA taking a view that undisclosed income assessed in case of assessee was in excess to undisclosed income shown in return of income, in view of fact that addition sustained remained only on estimate basis on account of gross profit on sales outside books of account and not on basis of any material found in possession of assessee during search proceedings, impugned penalty order was to be set aside Read Morenew
  
 [2014] 49 taxmann.com 24 (Delhi - Trib.)
HC directs TPO to fix ALP of AMP exp. on developing marketing intangibles of AEs following BMW India’s case -IT/ILT : Where assessee, a distributor of high end audio products manufactured by AE located abroad, incurred certain AMP expenditure for developing marketing intangibles for AE, in order to determine ALP of said AMP expenditure, matter was to be remanded back to TPO to determine same in light of decision in case of BMW India (P.) Ltd. v. Addl. CIT [2014] 146 ITD 165/[2013] 37 taxmann.com 319 (Delhi - Trib.) Read Morenew
  
 [2014] 49 taxmann.com 97 (Mumbai - Trib.)
Sums paid by TPA to hospitals for settlement of mediclaim won’t attract rigours of sec. 194J TDS -IT: Where assessee-third party administrator, settled mediclaim of insured and arranged said amount from insurance company, it was not liable to deduct tax against said payment made and therefore no disallowance under section 40(a)(ia) could be made Read Morenew
  
 [2014] 49 taxmann.com 138 (Delhi - Trib.)[2014] 159 TTJ 146 (Delhi - Trib.)
Sums forfeited on non-payment of instalments of share warrants would be treated as capital receipts, says ITAT -IT: Where assessee issued optionally convertible warrants during relevant year, amount forfeited by it on account of subsequent non-payment of instalments towards warrants issue had to be treated as capital receipt not liable to tax Read More
  
 [2014] 49 taxmann.com 110 (Chandigarh - Trib.)[2014] 30 ITR(T) 607 (Chandigarh - Trib.)[2014] 161 TTJ 1 (Chandigarh - Trib.)(UO)
Sec. 10B relief was available on receipt of sums from activity of copying of data from one software to another -IT : Sale of software on license basis would amount to sale for purpose of deduction under section 10B Read More
  
 [2014] 48 taxmann.com 363 (Hyderabad - Trib.)
Functional dissimilar Cos can’t be taken as comparables without making adjustment for dissimilarities -IT/ILT: Where there is functional dissimilarity between assessee and comparable companies, same cannot be compared without making adjustment for dissimilarities Read More
  
 [2014] 49 taxmann.com 38 (Lucknow - Trib.)
Sec. 2(22)(e): Lending-Co. advancing loan only to assessee couldn't claim to be having substantial business of lending -IT: Where lending companies advanced loans only to assessee and not to others, lending companies could not be said to have substantial part of business in money lending and thus loans and advances given to assessee were deemed dividend in light of provisions of section 2(22)(e) Read More
  
 [2014] 49 taxmann.com 146 (Chennai - Trib.)
Gift of shares to foreign AEs wouldn’t attract TP provisions as no income element was involved in such transaction -IT/ILT: Where assessee, an Indian company, transferred shares of its subsidiary company to another group concern located abroad without any consideration, it amounted to transaction of gift and in absence of any income element involved, transaction in question could not be subjected to transfer pricing provisions Read More
  
 [2014] 49 taxmann.com 137 (Jodhpur - Trib.)
Sums paid to NR providing consultancy on Nahar Pariyojna studies weren’t taxable in absence of its PE in India -IT/ILT : Where a foreign company, which had no PE in India entered into consultancy agreement with Indian entity and received certain payment which it paid to its sub-consultant for carrying out civil work, said sum could not be treated as income of foreign company Read More
  
 [2014] 49 taxmann.com 180 (Amritsar - Trib.)
A policy can’t be held as ‘Keyman Insurance Policy’ unless it is a pure life insurance policy on life of employee -IT : Where assessee purchased Insurance Policies, in view of fact that only a fraction of total premium was meant for risk premium and balance was for deployment of purchase of units i.e. investment in units, policies in question could not be regarded as 'Keyman Insurance Policies' Read More
  
 [2014] 49 taxmann.com 87 (Lucknow - Trib.)
Payments made to foreign agents for mobilising sales outside India are outside the ambit of ‘FTS’ -IT/ILT: Where assessee made payment of selling commission to its agent located abroad for mobilising its sales in foreign countries, since said services were not in nature of managerial services, payment in question was not taxable in India as 'fee for technical services' under section 9(1)(vii)(b) Read More
  
 [2014] 49 taxmann.com 102 (Visakhapatnam - Trib.)
AO is debarred from taking those issues in search assessment that can be considered in regular assessment -IT : When income has already been reflected in books of account of assessee and disclosed in return of income much prior to initiation of proceedings under section 153C, Assessing Officer cannot initiate proceedings under section 153C to assess such income as unexplained cash credit Read More
  
 [2014] 49 taxmann.com 151 (Mumbai - Trib.)
DRP rightly ordered exclusion of comparables as they had related party transactions exceeding 25%, says ITAT -IT/ILT : Where in course of determination of ALP in respect of non-banking investment advisory services rendered by assessee to its AE, DRP directed exclusion of three comparables having related party transactions in excess of 25 per cent, in view of order passed by coordinate Bench of Tribunal in case of Willis Processing Services (I) (P.) Ltd. v. Dy. CIT [2013] 57 SOT 339/30 taxmann.com 350 (Mum.) impugned finding recorded by DRP did not require any interference Read More
  
 [2014] 49 taxmann.com 141 (Amritsar - Trib.)[2013] 28 ITR(T) 89 (Amritsar - Trib.)
No sec. 69 addition if deviation in Qty. of stock shown in books and in statements given to banks was explained -IT: Where having regard to difference in figures of closing stock in statement submitted to bank for taking loan and in books of account on last day of relevant financial year, Assessing Officer made addition as unexplained investment, in view of fact that assessee submitted a reconciliation statement wherein said difference was explained as sales which remained uncontroverted, impugned addition deserved to be set aside Read More
  
 [2014] 47 taxmann.com 50 (Mumbai - Trib.)[2014] 150 ITD 213 (Mumbai - Trib.)
Benefit of Article 8 of India-Malaysia DTAA is available for shipping of goods under a slot charter arrangement -IT/ILT : Benefit of Article 8 of the Indo-Malaysia DTAA is also applicable to shipping of goods from Indian Port to Hub Port using feeder vessels under a space charter or slot charter as the entire voyage from the Indian Port to final destination port is inextricably linked and cannot be segregated. "Operation of ship" for Article 8 purposes can be done as charterer which does not mean to own or control the ship either as owner or as a lessee The word "charterer" should not be confused with the Read More
  
 [2014] 49 taxmann.com 50 (Chennai - Trib.)
ITAT allows sec. 54EC relief even for investment made beyond due date considering old age and illness of assessee -IT: Where assessee, aged 94 years, sold his residential property, in view of fact that due to his extreme old age and illness, he deposited sale proceeds in REC bonds with a delay of 59 days, it was to be concluded that assessee's case was governed by doctrine of supervening impossibility and, therefore, he was entitled to claim deduction under section 54EC Read More
  
 [2014] 48 taxmann.com 237 (Bangalore - Trib.)
Comparables can’t be chosen on basis of info obtained under Sec. 133(6) if it’s not made available to assessee -IT/ILT : No company can be selected as comparables only on basis of information obtained under section 133(6), without furnishing such information to assessee Read More
  
 [2014] 49 taxmann.com 42 (Mumbai - Trib.)[2014] 161 TTJ 397 (Mumbai - Trib.)
Higher fair market value estimated by DVO isn't sufficient to confirm additions under Section 69B -IT : Where assessee had offered a reasonable and plausible justification regarding actual consideration of sale/ purchase transactions relating to property in question and revenue had failed to discharge its burden to prove, addition made by revenue under section 69B to be deleted Read More
  
 [2014] 49 taxmann.com 66 (Mumbai - Trib.)
Even before 2013 protocol, treaty benefits allowed to fiscally transparent firm if its profits were taxed in UK -IT/ILT : Where assessee a U.K. based partnership firm engaged in 'rendering' legal services in India had PE in India in terms of article 5(2)(k) of India UK DTAA, profits attributable to PE were taxable under article 7 of India UK DTAA Read More
  
 [2014] 49 taxmann.com 44 (Chennai - Trib.)[2013] 28 ITR(T) 518 (Chennai - Trib.)
Money found credited in saving account of assessee added to his income on his failure to prove source of deposit -IT : Where assessee failed to produce evidence in respect of source of amount found in saving bank account, addition was to be made as unexplained money Read More
  
 [2014] 48 taxmann.com 404 (Hyderabad - Trib.)[2013] 28 ITR(T) 167 (Hyderabad - Trib.)
Revenue had rightly taxed capital gains on sale of property in the year in which its possession was handed over -IT: Where assessee filed his return for assessment year 2007-08 declaring capital gain from sale of property, in view of fact that sale deed was executed on 3-9-2005 and possession of property was also handed over on same date, revenue authorities rightly concluded that capital gain in question was to be assessed in assessment year 2006-07 Read More
  
 [2014] 49 taxmann.com 46 (Mumbai - Trib.)[2013] 158 TTJ 120 (Mumbai - Trib.)
No deemed concealment if additional income was declared by assessee pursuant to search via belated return -IT: In absence of any limitation or restriction relating to words 'due date' given in clause (b) of Explanation 5A to section 271(1)(c), it cannot be read as 'due date' as provided in section 139(1) alone rather it can also mean date of filing of return of income under section 139(4) Read More
  
 [2014] 48 taxmann.com 384 (Delhi - Trib.)
TPO couldn't make consulting company a 'comparable' for marketing company for TP adjustments -IT/ILT : Functionally dissimilar companies cannot be selected as comparables Read More
  
 [2014] 49 taxmann.com 45 (Mumbai - Trib.)[2014] 30 ITR(T) 705 (Mumbai - Trib.)
Donation by one charitable trust to other charitable trust amounts to application of income -IT : In order to obtain approval under section 80G(5), donation made by a charitable trust to other charitable trusts/institutions amounts to application of income within meaning of section 11(1)(a) Read More
  
 [2014] 49 taxmann.com 65 (Hyderabad - Trib.)
TPO couldn’t reject a manufacturing comparable ignoring fact that assessee was into trading as well as manufacturing -IT/ILT : Where assessee was engaged in manufacture and marketing of food products but comparables were rejected by TPO on basis that assessee-company was engaged in sale of ready to eat items, matter was to be re-adjudicated Read More
  
 [2014] 48 taxmann.com 359 (Chennai - Trib.)[2014] 31 ITR(T) 103 (Chennai - Trib.)
CT scan equipments are entitled to higher depreciation rate of 40%, says ITAT -IT : PET/CT scan equipment is entitled for higher rate of depreciation at 40 per cent Read More
  
 [2014] 49 taxmann.com 176 (Hyderabad - Trib.)
Equity investments in AE can’t be deemed as loans/advances; it’s outside the ambit of international transaction -IT/ILT: Investments in nature of equity, cannot be treated as loans and advances and hence cannot be brought within purview of 'international transactions' as defined under section 92B Read More
  
 [2014] 48 taxmann.com 403 (Mumbai - Trib.)
AO to verify assessee's plea that sec. 69A addition couldn't be made on him as it was already made on his brother -IT: Where assessee challenged addition made on account of unaccounted commission in respect of giving accommodation entries to various parties taking a plea that said addition had already been made in case of his brother, since aforesaid plea required verification at level of Assessing Officer, matter was to be remanded back for disposal afresh Read More
  
 [2014] 49 taxmann.com 147 (Delhi - Trib.)
Group Cos negotiating/securing contracts on behalf of foreign Co. would be deemed as service PE in India -IT/ILT : Where assessee, a US based company, entered into contract with an Indian company for supply, installation, testing and commissioning of equipment relating to GSM Cellular Radio Telephone System, in view of fact that a group company namely 'NL' India undertook responsibility for negotiating and securing contracts whereas another group company namely 'NL' Canada supplied aforesaid equipments and its LO in India rendered other services to assessee, those group concerns constituted assessee Read More
  
 [2014] 49 taxmann.com 441 (Delhi - Trib.)
Salary paid by overseas HO to expatriate employees working exclusively for Indian branch is fully deductible -IT/ILT : Where assessee, a bank incorporated in Japan, paid salaries abroad to its expatriates working in Indian branch constituting PE, in view of fact that said expenditure had been incurred wholly and exclusively for Indian branch and, no part of those expenses could be allocated to any other branch by head office, provisions of section 44C did not apply to said expenditure and thus, assessee's claim for deduction of salary expenses was to be allowed Read More
  
 [2014] 48 taxmann.com 401 (Delhi - Trib.)
Order of DRP without considering objections of assessee is a 'non-speaking' order; set aside by ITAT -IT/ILT: Where order passed by DRP was a laconic non-speaking order as it had not given any reason for disposal of assessee's objections and had also not adopted any reasons contained in draft assessment order nor even reasons that were contained in order of TPO; same was to be set aside Read More
  
 [2014] 48 taxmann.com 182 (Jodhpur - Trib.)[2013] 158 TTJ 1 (Jodhpur - Trib.)
Contribution towards approved group gratuity scheme of LIC is a deductible exp. under section 36(1)(v) -IT: Liability to pay in respect of salary settlement crystallizes in year of approval Read More
  
 [2014] 48 taxmann.com 326 (Hyderabad - Trib.)
Technical payments to AEs couldn’t be held as nil if payments under technical agreement were duly approved by RBI -IT/ILT: Where TPO made adjustment to assessee's ALP taking a view that value of technical know how fee and royalty paid by assessee to its promoter company was nil, in view of fact that technical service agreement was duly approved by RBI and, moreover, TPO had not analysed payments in question either under TNMM method or under any other method as required by transfer pricing provisions, impugned disallowance made by TPO was to be set aside Read More
  
 [2014] 49 taxmann.com 39 (Jodhpur - Trib.)[2013] 158 TTJ 42 (Jodhpur - Trib.)
No penalty if assessee offers undisclosed income to tax in return filed pursuant to search of another person -IT : Where pursuant to search proceedings in case of another person, assessee filed a return declaring certain undisclosed income which was duly accepted while framing assessment under section 143(3), read with section 153A, there being no concealment of particulars of income, impugned penalty order passed under section 271(1)(c) was to be set aside Read More
  
 [2014] 49 taxmann.com 32 (Jabalpur - Trib.)[2013] 158 TTJ 54 (Jabalpur - Trib.)
Deductor couldn't be treated as an assessee-in-default if deductee was not liable to pay taxes due to losses -IT/ILT : If recipient of income has no tax liability as per assessment framed under section 143(3) due to losses, then section 201 cannot be made applicable to assessee payee for non-deduction/delay in deposit of TDS Read More
  
 [2014] 48 taxmann.com 386 (Amritsar - Trib.)[2014] 31 ITR(T) 177 (Amritsar - Trib.)
Receipts of all institutions of one society are to be clubbed together to check limit of 1 crore under sec. 10(23C) -IT: Where receipts of assessee-society from two institution managed and run by it exceeded Rs. 1 crore, in absence of exemption certificate under section 10(23C), receipt exceeding over Rs. 1 crore was rightly brought to tax Read More
  
 [2014] 48 taxmann.com 240 (Mumbai - Trib.)
ITAT denies depreciation as assessee failed to prove that asset was used in his business operations -IT: Depreciation on factory building and plant & machinery never put to use during year, could not be allowed Read More
  
 [2014] 49 taxmann.com 51 (Bangalore - Trib.)[2014] 30 ITR(T) 591 (Bangalore - Trib.)
ITAT directs TPO to make afresh TP adjustment in accordance with directions issued by it earlier -IT/ILT : Where in pursuance of Tribunal's directions, TPO passed an order wherein addition made to assessee's ALP was reduced, in view of fact that there were variations and inconsistencies while implementing directions of earlier Bench, impugned order was to be set aside with a direction to Assessing Officer/TPO to revise transfer pricing adjustment in accordance with directions issued by Tribunal in letter and spirit Read More
  
 [2014] 48 taxmann.com 346 (Chennai - Trib.)
No deemed dividend on receipts pursuant to family settlement even if assessee had substantial interest in payer-Co. -IT : Where pursuant to family settlement, assessee received certain amount and assets from a company in which he had substantial interest, provisions of section 2(22)(e) could not be applied to amount so received Read More
  
 [2014] 48 taxmann.com 388 (Pune - Trib.)
Charterer of ship can't be alleged as conduit if relevant docs proves it's position; treaty benefits allowed -IT/ILT : Where cyprus shipping company was not merely a paper company and played its role, Indian agent could not be taxed for its income and treaty benefit of Article 8 of Indo-Cyprus DTAA would be available to it Read More
  
 [2014] 48 taxmann.com 332 (Delhi - Trib.)
Royalty income offered by NR at lower tax rate without any assessment to be deemed as escaped income -IT/ILT: Reassessment in case of assessee a non-resident company was to be upheld as application of 15 per cent tax rate for royalty income under India-US DTAA instead of 30 per cent under section 115A of amounts to lower tax rate application resulting in escapement of Income Read More
  
 [2014] 48 taxmann.com 350 (Bangalore - Trib.)[2013] 27 ITR(T) 648 (Bangalore - Trib.)
AO couldn’t allow notional depreciation while computing capital gains on sale of seized assets by bank -IT: Where assets of assessee were seized by bank as a result of default in repayment of loan, assessee not being in possession of assets, it could not be said that seized assets were kept in a state of readiness and, therefore, while computing capital gain on subsequent sale of those assets carried out by bank directly, Assessing Officer was not justified in allowing notional depreciation in terms of Explanation 5 to section 32 Read More
  
 [2014] 48 taxmann.com 383 (Mumbai - Trib.)
TPO directed to examine proper facts and fix ALP of credit risk assessment exp. charged by HO to Indian branch -IT/ILT : Where assessee, a non-resident bank, charged credit risk assistance expenses from Indian branch separately in same invoice in which it had allocated certain expenses as share of Indian branch in Head Office expenses and, therefore, TPO opined that ALP of seperately claimed expenses was nil, in absence of assessee's explanation and any certificate issued by auditor of Head Office in support of expenses in dispute, matter was to be remanded back for disposal afresh Read More
  
 [2014] 48 taxmann.com 331 (Hyderabad - Trib.)
Income from offshore supply of cables couldn’t be attributed to PE of NR in India, says ITAT -IT/ILT: Where offshore contract was only for procurement of cables that too outside India, no part of income could be said to be attributable to assessee's PE in India Read More
  
 [2014] 49 taxmann.com 40 (Amritsar - Trib.)[2014] 161 TTJ 405 (Amritsar - Trib.)
ITAT quashed sec. 148 notice as it was issued prior to date of approval from Joint or Additional CIT -IT: Where Assessing Officer issued notice under section 148 prior to date of approval from Jt. Commissioner /Addl. Commissioner, notice was bad in law and liable to be quashed Read More
  
 [2014] 48 taxmann.com 373 (Delhi - Trib.)
Income arising to NR from activities not related to its PE in India isn’t taxable -IT/ILT : Where revenue did not challenge Tribunal's finding that Indian subsidiary of assessee-company only constituted its service PE in India in first round of litigation, it could not challenge consequential assessment order passed by Assessing Officer raising a new plea that Indian subsidiary constituted not only service PE but also fixed place PE of assessee in India Read More
  
 Statutes
  
PRESS RELEASE [F.NO. 385/10/2014-IT(B)]
Due date for deposit of TDS for month of September, 2014 extended to October 10, 2014 -IT/ILT : Section 119 of The Income-Tax Act, 1961 - Income-Tax Authorities - Instructions To Subordinate Authorities – Extension of Due Date of Deposit of Tax Deducted/Collected At Source During Month of September, 2014 Read Morenew
  
NOTIFICATION NO.47/2014 [F.NO.501/08/1979-FTD-I]
Protocol to India-Poland DTAA cuts down tax rates: 10% tax on dividend and interest, 15% tax on royalty and FTS -IT/ILT : Section 90 of The Income-Tax Act, 1961 - Double Taxation Agreement - Agreement for Avoidance of Double Taxation and Prevention of Fiscal Evasion with Foreign Countries – Poland Read Morenew
  
NOTIFICATION NO.44/2014 [F.NO.501/3/99-FTD-II]
Govt. notifies comprehensive DTAA with Colombia -IT/ILT : Section 90 of The Income-Tax Act, 1961 - Double Taxation Agreement - Agreement for Avoidance of Double Taxation and Prevention of Fiscal Evasion with Foreign Countries – Columbia Read More
  
NOTIFICATION NO. 45/2014 [F.NO.500/1/2014-APA-II]/
CBDT keeps tolerable limit for ALP unchanged for Assessment Year 2014-15; "wholesale trading" defined -IT/ILT : Section 92C of the Income-Tax Act, 1961 - Transfer Pricing - Computation of Arm’s Length Price - Notified Tolerable Limit for Determination of ALP Read Morenew
  
ORDER NO. 7/FT&TR/2014 [F.NO.500/12/2013-SO/FT&TR-
CBDT reconstitutes DRPs at Delhi, Bengaluru and Mumbai -IT/ILT : Section 144C of The Income-Tax Act, 1961 - Dispute Resolution Panel (DRP) - Reference to - Constitution of DRP-IV at Delhi Read More
  
ORDER NO. 5/FT&TR/2014 [F.NO.500/12/2013-SO/FT&TR-
CBDT notifies jurisdiction of DRPs at Delhi and Bengaluru -IT/ILT : Section 144C of The Income-Tax Act, 1961 - Dispute Resolution Panel (DRP) - Reference to - Reconstitution of DRPS at Delhi – Modification of Order No.7/FT&TR/2014, dated 14-11-2013 Read More
  
INSTRUCTION NO.7/2014 [F.NO.225/229/2014-ITA.II]
CBDT directs AO to enquire into only AIR data/26AS mismatch issues if scrutiny is made on this basis -IT/ILT : Section 143, read with Section 142 of The Income-Tax Act, 1961 – Assessment – Scope of Enquiry in Cases Selected for Scrutiny During Financial Year 2014-15 on Basis of AIR/CIB/26AS mismatch Read More
  
NOTIFICATION NO. 46/2014[F.NO.133/10/2014-TPL]/SO
CBDT mandates issue of nil TDS certificate to deductor and lower TDS certificate to recipient of income -IT/ILT : Income-Tax (Ninth Amendment) Rules, 2014 – Amendment in Rule 28AA and Substitutiton of Form No.13 Read More
  
NOTIFICATION NO. GSR 624(E) [F.NO. HRD/TCB/620/2/2
CBDT notifies functional jurisdiction of Direct Taxes Regional Training Institutes -IT : Section 120 of The Income-Tax Act, 1961 - Income-Tax Authorities - Jurisdiction of – Direct Taxes Regional Training Institutes (DTRTIS) Read More
  
NOTIFICATION NO. GSR 625(E) [F.NO. HRD/TCB/620/2/2
CBDT notifies functional jurisdiction of Ministerial Staff Training Units -IT : Section 120 of The Income-Tax Act, 1961 - Income-Tax Authorities - Jurisdiction of – Ministerial Staff Training Units (MSTUs) Read More
  
OFFICE MEMORANDUM [F.NO.279/MISC./33/2014-ITJ(PT.)
CBDT seeks inputs from officials on its instructions containing allocation of work amongst CIT(Judicial) -IT : Section 268 of the Income-Tax Act, 1961 - Allocation of Work Amongst CIT (Judicial) and their Jurisdiction – Committee to Review the CBDT Instruction No.4/2002, Dated 7-5-2002 on Work Allocation of CSIT(j) – Suggestions Invited From All Officers Thereon Read More
  
ORDER NO.4/FT&TR/2014 [F.NO. 500/12/2013-SO/FT&TR-
CBDT reconstitutes DRP panel at Kolkata -IT/ILT : Section 144C of the Income-Tax Act, 1961 – Dispute Resolution Panel (DRP) – Reference To – Reconstitution of DRP at Kolkata Read More
  
NOTIFICATION NO. 43/2014 [F.NO.152/1/2013-TPL]/SO
CBDT extends 80% rate of depreciation on windmills and devices running on wind energy installed after 31-3-2014 -IT : Income-Tax (Eighth Amendment) Rules, 2014 - Amendment in New Appendix-I Read More
  
OFFICE MEMORANDUM [F.NO.279/MISC./M-84/2014-(ITJ)]
CBDT seeks inputs from officials to improve quality of assessment orders and to reduce litigation -IT : Constitution of A Committee to Study The Appellate Orders to Examine The Filing of Appeals by Department before Various Forums – Suggestions Invited from all Officers for Improving Quality of Assessment Orders and to Strengthen Institution of CIT(A) Read More
  
LETTER [F.NO.SW/3/3/96/01-DIT(S)]
DIT asks Nodal officers to transfer out PAN from old/orphan jurisdictions to jurisdictional AOs -IT/ILT : Section 139A of The Income-Tax Act, 1961 – Permanent Account Number (PAN) – Migration of Pans Lying in Old/Orphan Jurisdiction and Review of AO Codes Where no Employee Number is Attached Read More
  
ORDER NO. 3/FT&TR/2014 [F.NO.500/12/2013-SO/FT&TR-
CBDT reconstitutes DRP panel at Bengaluru -IT/ILT : Section 144C of The Income-Tax Act, 1961 - Dispute Resolution Panel (DRP) - Reference to - Reconstitution Of DRP at Bengaluru Read More
  
 News
  
Centralized Processing Center (CPC), Income Tax Department, Bangalore becomes ISO-27001:2005 Compliant -Centralized Processing Center (CPC), Income Tax Department, Bangalore becomes ISO-27001:2005 Compliant [30-09-2014] Read Morenew
  
How a Missing `Or' Helped Oracle Save Rs 142 cr in Tax -How a Missing `Or' Helped Oracle Save Rs 142 cr in Tax [30-09-2014] Read Morenew
  
SEs to Have Priority over I-T Dept in Recovery of Dues from Defaulters: SC -SEs to Have Priority over I-T Dept in Recovery of Dues from Defaulters: SC [27-09-2014] Read More
  
CBDT extended due date for filing of return to November 30, 2014; no extension to Cos/Firms not liable to tax audit -Section 119, read with section 44ab, of the Income-tax Act, 1961 – Instructions to subordinate authorities – Extension of filing of return of income for assessment year 2014-15 in case of assessees who have to file tax audit report [26-09-2014] Read More
  
China offers tax sops to retain prowess -China offers tax sops to retain prowess [26-09-2014] Read More
  
SC Stalls Tax Tribunal Plans, Says Body Must Meet Top Court Standards -SC Stalls Tax Tribunal Plans, Says Body Must Meet Top Court Standards [26-09-2014] Read More
  
Cos Scramble to Pay Dividend to Dodge Date with Higher Tax -Cos Scramble to Pay Dividend to Dodge Date with Higher Tax [25-09-2014] Read More
  
Vodafone ready to settle tax rowoutside arbitration -Vodafone ready to settle tax rowoutside arbitration [25-09-2014] Read More
  
Small but significant -Small but significant [24-09-2014] Read More
  
India Backs Automatic Info Exchange for Black Money -India Backs Automatic Info Exchange for Black Money [23-09-2014] Read More
  
Gujarat High Court directs CBDT to extend due date for filing of ITR to 30-11-2014 subject to Sec. 234A interest -Gujarat High Court directs CBDT to extend due date for filing of ITR to 30-11-2014 subject to Sec. 234A interest [22-09-2014] Read More
  
G20 commitment on tax data to help India track black money -G20 commitment on tax data to help India track black money [22-09-2014] Read More
  
Switzerland Feels the Heat on Sharing Bank Ac Info -Switzerland Feels the Heat on Sharing Bank Ac Info [22-09-2014] Read More
  
Back to tax confusion -Back to tax confusion [19-09-2014] Read More
  
CBDT Seeks Staff Views to Expedite Processes -CBDT Seeks Staff Views to Expedite Processes [19-09-2014] Read More
  
Due date for payment of advance tax extended by three months for taxpayers in State of J&K -Date of payment of the September instalment of advance tax is extended from 15th September 2014 to 15th December 2014 for the taxpayers in State of Jammu & Kashmir [18-09-2014] Read More
  
India's Black Money Proposal Not Feasible, feels Oz G-20 Meet Host -India's Black Money Proposal Not Feasible, feels Oz G-20 Meet Host [18-09-2014] Read More