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Gains from Penny Stocks: If the purchase of shares has been made solely and exclusively with the intention to resell at a profit and the purchaser has no intention of holding them, the transaction is an "adventure in the nature of trade" and the gains are assessable as "business profits" and not as "short-term capital gains"
Prem Jain vs. ITO
(2018) TaxCorp(LJ) 14606 (ITAT-DELHI)
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Transfer Pricing: CBDT's Instruction No. 3/2003 is binding on the AO. Consequently, the ALP of international transactions where the quantum is less than Rs. 5 crore has to be determined by the AO and cannot be referred to the TPO. If such reference is made, it is invalid and the extended time for completing the assessment is not available to the AO. The assessment is void as it is time-barred
Calance Software Pvt. Ltd. vs. DCIT
(2018) TaxCorp(LJ) 14605 (ITAT-DELHI)
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Bogus Capital gains from penny stocks: Capital gains from penny stocks cannot be assessed as unexplained cash credit u/s 68 if the assessee has produced documentary evidence to prove the source, identity and genuineness of the transaction and the AO has not found any fault with it. The fact that the investigation dept has alleged that there is a modus operandi of bogus LTCG scheme is not relevant if the same is not substantiated
Meenu Goel vs. ITO
(2018) TaxCorp(LJ) 14594 (ITAT-DELHI)
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S. 271(1)(c) Penalty: The primary burden of proof is on the Revenue to show that the assessee is guilty of concealment/ furnishing inaccurate particulars. Making an incorrect claim does not tantamount to furnishing inaccurate particulars by any stretch of imagination. Wrong claim of depreciation by crediting capital subsidy to reserves instead of reducing from actual cost/ WDV does not attract s. 271(1)(c) penalty
Prafful Industries (P) Ltd. Vs. DCIT
(2018) TaxCorp(LJ) 14593 (ITAT-DELHI) · Section. 271(1)(c)
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S. 143(2) Notice: The issue of a s. 143(2) notice by an AO not having jurisdiction over the assessee is irrelevant. If the proper AO does not issue the notice within the time limit, the assessment is null and void. The argument that the non-jurisdictional AO issued the s. 143(2) notice as per PAN or computerized system or internal procedure is not relevant as it violates the law
ITO. Vs. NVS Builders Pvt. Ltd.
(2018) TaxCorp(LJ) 14557 (ITAT-DELHI) · Section. 143(2)
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S. 147 Reopening: The grant of approval by the CIT with the words “Yes. I am satisfied” proves that the sanction is merely mechanical and he has not applied independent mind while according sanction as there is not an iota of material on record as to what documents he had perused and what were the reasons for his being satisfied to accord the sanction to initiate the reopening of assessment u/s 148 of the Act
ITO vs. Virat Credit & Holdings Pvt.Ltd
(2018) TaxCorp(LJ) 14455 (ITAT-DELHI) · Section 147
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S. 68 Bogus share capital: If the assessee has discharged the initial onus regarding the identity, creditworthiness and genuineness, the onus shifts to the AO to bring material or evidence to discredit the same. The fact that the shareholders did not respond to s. 133(6) summons is not sufficient to draw an adverse inference. There must be material to implicate the assessee in a collusive arrangement with person who are accommodation entry providers
Umbrella Projects Pvt. Ltd vs. ITO
(2018) TaxCorp(LJ) 14434 (ITAT-DELHI) · Section 68
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ITAT - No penalty u/s 271B where there is no computation of profits and gains of the business or profession as part of the total income.
United Education Society, C/o NIMT College Versus JCIT, Ghaziabad
(2018) TaxCorp(LJ) 14262 (ITAT-DELHI) · http://taxcorp.in/FileOpenDT.aspx?ID=61566&Category=ITAT&CategoryType=Zip
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ITAT - No material to support that mother of Karta of assessee HUF, is member of his HUF, hence gift of equity shares received by the assessee is taxable u/s 56(2)(vii).
Subodh Gupta (HUF) , C/o. M/s. RRA Tax india Versus Pr. CIT-11, New Delhi
(2018) TaxCorp(LJ) 14261 (ITAT-DELHI) · http://taxcorp.in/FileOpenDT.aspx?ID=61535&Category=ITAT&CategoryType=Zip
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ITAT - Approval u/s 10(23C)(vi) to be granted to a trust which runs a college that helps in enhancing the future of students by providing the education and making available the diploma courses in Polytechnic and Engineering and which are duly approved by AICTE.
Bhartiya Gram Sewa Niketan Udyog Mandal C/o. M/s. RRA Tax India Versus CCIT, Dehradun
(2018) TaxCorp(LJ) 14254 (ITAT-DELHI) · http://taxcorp.in/FileOpenDT.aspx?ID=61554&Category=ITAT&CategoryType=Zip
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ITAT - Use of trademark, trade name etc. in rendering of advertisement, publicity and sales promotion services is neither royalty nor FTS.
Reebok India Company vs. DCIT
(2018) TaxCorp(LJ) 14209 (ITAT-DELHI)
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S. 56(2)(vii) Taxability of gifts as income: Meaning of the term "relative" in the context of a Hindu Undivided Family (HUF), and whether if the donor is the mother of the Karta of the HUF, a gift by the mother to the HUF is a gift from a "relative" so as to avoid attracting tax liability explained. All judgements on the subject considered
Subodh Gupta (HUF) vs. Pr. CIT
(2018) TaxCorp(LJ) 14192 (ITAT-DELHI) · Section. 56(2)(vii)
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S. 12A: CIT is not justified in rejecting registration on the ground that the non-production of books and vouchers means that the genuineness of the charitable activities cannot be verified. The CIT is entitled only to examine the objects of the trust at the stage of registration and not the books of account
Vidyadayani Shiksha Samiti vs. CIT
(2018) TaxCorp(LJ) 14141 (ITAT-DELHI) · Section 12A
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S. 271(1)(c) Penalty: Under Explanation 7 to s. 271(1)(c), the onus on the assessee is only to show that the ALP is computed in accordance with the scheme of s. 92 C in good faith and due diligence. The fact that the TPO changes the method of computation of ALP does not mean it is a fit case for imposition of penalty if there is no dishonesty is found in the conduct of the assessee
Halcrow Consulting India Pvt. Ltd. vs. DCIT
(2018) TaxCorp(LJ) 14125 (ITAT-DELHI) · Section. 271(1)(c)
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S. 271(1)(c) Penalty: The law in Maharaj Garage (Bom) that it is not necessary for the penalty notice to frame a specific charge cannot be followed in the context of whether the notice should specify 'concealment' vs. 'inaccurate particulars' because the judgement does not consider SSA’s Emerald Meadows (SC) and is contrary to Samson Perinchery (Bom)
Aditya Chemicals Ltd. Vs. ITO
(2018) TaxCorp(LJ) 14124 (ITAT-DELHI) · Section. 271(1)(c)
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S. 68 Bogus share capital: Share application money cannot be treated as unexplained credit if the AO does not make any investigation on the documentary evidences filed by the assessee or ask for the production of the investors for examination u/s 131 or if adverse material is found during search to prove that share application money is bogus or an arranged affair of the assessee
ACIT vs. TRN Energy Pvt. Ltd
(2018) TaxCorp(LJ) 14121 (ITAT-DELHI) · Section 68
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S. 32(1)(ii) Depreciation on non-compete fee: The AO should consider whether the verdict in Sharp Business System 211 TM 576 (Del) that non-compete rights are not intangible assets for depreciation can apply to a case where there is no joint venture between the person paying the non-competition fee and the recipient and both parties are outsiders. Law laid down in Nat Steel Equipments vs. CCE AIR 1988 SC 631 on the meaning of the term "similar" to be considered
DCIT vs. Caparo Engineering India P. Ltd
(2017) TaxCorp(LJ) 14082 (ITAT-DELHI) · Section 32(1)(ii)
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S. 32(1)(ii) Depreciation on non-compete fee: The AO should consider whether the verdict in Sharp Business System 211 TM 576 (Del) that non-compete rights are not intangible assets for depreciation can apply to a case where there is no joint venture between the person paying the non-competition fee and the recipient and both parties are outsiders. Law laid down in Nat Steel Equipments vs. CCE AIR 1988 SC 631 on the meaning of the term "similar" to be considered
DCIT. vs. Caparo Engineering India P. Ltd.
(2017) TaxCorp(LJ) 14072 (ITAT-DELHI) · Section. 32(1)(ii)
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S. 263 Revision: Explanation 2 to s. 263 inserted w.e.f. 01.06.2015 does not override the law as interpreted by the various High Courts whereby it is held that the CIT cannot treat the AO's order as being erroneous and prejudicial to the interest of revenue without conducting an enquiry and recording a finding. If the Explanation is interpreted otherwise, the CIT will be empowered to find fault with each and every assessment order and also to force the AO to conduct enquiries in the manner preferred by the CIT, thus prejudicing the mind of the AO, This will lead to unending litigation and no finality in the legal proceedings which cannot be the intention of the legislature in inserting the Explanation
Amira Pure Foods Pvt. Ltd vs. Pr CIT
(2017) TaxCorp(LJ) 13947 (ITAT-DELHI) · Section 263
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HC - Under Sec. 226, the money which belong to the assessee shall only be available for payment as income-tax dues however, money lying in assessee’s bank account to the extent of decree passed did not belong to it as assessee was holding such money in trust.
Sunil Kumar vs. Stock Guru India Ltd. & Anr.
(2017) TaxCorp(LJ) 13821 (ITAT-DELHI)
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