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HC - Lays down the legal position in respect of an accommodation entry provider seeking the benefit of 'peak credit'. No benefit of ‘Peak credit’ as deposits remain unexplained.
CIT. vs. D.K. Garg
(2017) TaxCorp(LJ) 13380 (HC-DELHI)
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S. 260A: Right of appeal is not a matter of procedure. It is a substantive right. This right gets vested in the litigants at the commencement of the lis and such a vested right cannot be taken away or cannot be impaired or imperilled or made more stringent or onerous by any subsequent legislation unless the subsequent legislation said so either expressly or by necessary intendment. An intention to interfere with or impair or imperil a vested right cannot be presumed unless such intention be clearly manifested by express words or by necessary implication.
K Raveendranathan Nair vs. CIT
(2017) TaxCorp(LJ) 13375 (SC) · Section. 260A
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S. 271AAA: No penalty u/s 271AAA can be levied in respect of undisclosed income found during a search u/s 132 if the AO did not put a specific query to the assessee by drawing his attention to s. 271 AAA and asking him to specify the manner in which the undisclosed income, surrendered during the course of search, had been derived
Pr CIT. vs. Emirates Technologies Pvt. Ltd.
(2017) TaxCorp(LJ) 13374 (HC-DELHI) · S. 271AAA
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S. 43(1) Explanation 10: The law laid down in PJ Chemicals 210 ITR 830 (SC) that only a subsidy or grant given to offset the cost of an asset can be reduced from the "actual cost" of the asset and not a general subsidy continues to hold good even after the insertion of Explanation 10 to s. 43(1). A subsidy/ grant from a foreign sovereign Country does not fall within Expl 10 because the foreign Country is not a "person" as defined in s. 2(31)
Spectrum Coal & Power Ltd. vs. ACIT
(2017) TaxCorp(LJ) 13373 (ITAT-MUMBAI) · Section. 43(1)
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S. 80P Test of Mutuality: An assessee cannot be treated as a co-operative society meant only for its members and providing credit facilities to its members if it has carved out a category called ‘nominal members’. These are those members who are making deposits with the assessee for the purpose of obtaining loans, etc. and, in fact, they are not members in the real sense. Most of the business of the assessee was with this category of persons who have been giving deposits which are kept in Fixed Deposits with a motive to earn maximum returns. A portion of these deposits is utilised to advance gold loans, etc. to the members of the first category. It is found that the depositors and borrowers are quite distinct. In reality, such activity of the appellant is that of finance business and cannot be termed as co-operative society
The Citizens Cooperative Society Ltd. vs. ACIT
(2017) TaxCorp(LJ) 13372 (SC) · Section. 80P
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S. 115JA/ JB Book Profits: Clause (i) to the Explanation was inserted to supersede HCL Comnet 305 ITR 409 (SC). Accordingly, a mere provision for bad debts has to be added back for computation of book profit u/s 115JA/JB. However, in terms of Vijaya Bank 323 ITR 166 (SC), if there is a simultaneous reduction from the loans and advances on the asset side of the balance sheet, the provision amounts to a write-off of the debt which is not hit by clause (i) of the Explanation to section 115JB
CIT. vs. Vodafone Essar Gujarat Ltd.
(2017) TaxCorp(LJ) 13371 (HC-GUJARAT) · Section. 115JA/ JB
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S. 68 "Peak Credits": An accommodation entry provider wanting to avail the benefit of the 'peak credit' has to make a clean breast of all the facts within his knowledge concerning the credit entries in the accounts. He has to explain with sufficient detail the source of all the deposits in his accounts as well as the corresponding destination of all payments from the accounts. The assessee should be able to show that money has been transferred through banking channels from the bank account of creditors to the bank account of the assessee, the identity of the creditors and that the money paid from the accounts of the assessee has returned to the bank accounts of the creditors. The assessee has to discharge the primary onus of disclosure in this regard
CIT. vs. D. K. Garg
(2017) TaxCorp(LJ) 13370 (HC-DELHI) · Section. 68
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ITAT - Excess stock / investment found in search to be treated as ‘business income’. Set off business loss allowed while computing tax liability u/s 115BBE.
ACIT. vs. Sanjay Bairathi Gems Ltd.
(2017) TaxCorp(LJ) 13369 (ITAT-JAIPUR) · Section. 115BBE
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SC - In all cases where assessee is in appeal in the HC u/s. 260A, if the date of assessment is prior to March 06, 2003, Sec. 52A of the Kerala Court Fees and Suits Valuation Act, 1959 shall not apply and the court fee shall be payable as per provisions prevailing as on the date of such assessment order.
K. Raveendranathan Nair vs. CIT
(2017) TaxCorp(LJ) 13362 (SC)
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Severe strictures passed to condemn the illegal practice of the Dept of collecting undated cheques from taxpayers after search/ survey without even quantifying the extent of duty evasion. Attempt of the unscrupulous officers is to 'negotiate' the evaded duty by threats and coercion. It is not rule of law but anarchy unleashed by holders of public office. It is an abuse of law which has to be stopped
Digipro Import & Export Pvt. Ltd. vs. UOI
(2017) TaxCorp(LJ) 13361 (HC-DELHI)
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S. 68: Statements recorded u/s 132 (4) do not by themselves constitute incriminating material. A copy of the statement together with the opportunity to cross-examine the deponent has to provided to the assessee. If the statement is retracted and/or if cross-examination is not provided, the statement has to be discarded. The onus of ensuring the presence of the deponent cannot be shifted to the assessees. The onus is on the Revenue to ensure his presence
Pr CIT. vs. Best Infrastructure (India) Pvt. Ltd.
(2017) TaxCorp(LJ) 13360 (HC-DELHI) · Section. 68
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HC (Larger Bench) - If an assessee debits provision for doubtful debt to the Profit and Loss account and makes a corresponding credit to the current liabilities and provisions on the liabilities side of the balance sheet, then it would constitute a provision for doubtful debt and not entitled to SEc. 36(1)(vii) benefit.
Vodafone Essar Gujarat Ltd. Vs. CIT
(2017) TaxCorp(LJ) 13359 (HC-GUJARAT)
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HC - No penalty u/s 271AAA in case of AO’s failure to seek manner of earning ‘undisclosed income’.
PCIT. Vs. Mukeshbhai Ramanlal Prajapati
(2017) TaxCorp(LJ) 13358 (HC-GUJARAT) · Section. 271AAA
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ITAT - Subsequent demolition of new house is not a ground to deny Sec. 54 exemption claim.
Vikas Kumar vs. DCIT
(2017) TaxCorp(LJ) 13357 (ITAT-HYDERABAD) · Section. 54
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HC - Assessee’s reliance on SC ruling appears to be a lame excuse in order to avoid the tax liability and depriving the Revenue its due share in the taxable income. Confirms penalty levy u/s. 273(2)(a).
Trustee of Saurashtra Trust vs. DIT
(2017) TaxCorp(LJ) 13356 (HC-BOMBAY)
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HC - Wealth-tax to be levied on assets held by assessee despite assessee co. amalgamated with another co..
Balaji Industries Ltd. Vs. The Deputy Commissioner of Wealth Tax
(2017) TaxCorp(LJ) 13355 (HC-MADRAS)
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HC - Depreciation not to be deducted while computing exempt income from operating warehouses under erstwhile Sec. 10(29).
Central Warehousing Corporation vs. PCIT
(2017) TaxCorp(LJ) 13342 (HC-DELHI)
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SC - The co-operative society (providing credit facilities beyond members) cannot be treated as a co-operative society meant only for its members and providing credit facilities to its members. Such a society cannot claim the benefit of Section 80P of the Act
The Citizen Co-Operative Society vs. ACIT
(2017) TaxCorp(LJ) 13341 (SC) · Section. 80P
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Transfer Pricing: A party is not barred in law from withdrawing from its list of comparables a company found to have been included on account of mistake of fact. The Transfer Pricing Mechanism requires comparability analysis to be done between like companies and controlled and uncontrolled transactions by carrying out of FAR analysis. The assessee's submission in arriving at the ALP is not final. It is for the TPO to examine and find out the companies listed as comparables which are in fact comparable
CIT. vs. Tata Power Solar Systems Ltd.
(2017) TaxCorp(LJ) 13334 (HC-BOMBAY)
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Interest on interim compensation received pending final disposal by the High Court is income if there is no direction given by the Court. The source of funds to earn income cannot determine the taxability of the income. The fact that the assessee may have to return the compensation and interest on the principle of restitution as provided under S. 144 of the Civil Procedure Code is not relevant because restitution is not a certainty. Paragon Construction 274 ITR 413 (Del) distinguished
Premlata Purshottam Paldiwal vs. CIT
(2017) TaxCorp(LJ) 13333 (HC-BOMBAY)
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