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Archive: 04 August 2013

Posts in 04 August 2013

Reassessment on the basis of subsequent decision cannot be said to be a mere change of opinion

August 4, 2013 1852 Views 0 comment Print

The assessment in the instant case was re-opened on the ground that the Special Bench of the Tribunal in the assessee’s own case for AY 2006-07 had reversed the earlier decision of the Tribunal in the assessee’s case for AY 2005-06 whereby the Special Bench held that the commission of Rs.1 .20 crores to the three Directors was in lieu of dividend and the same was not allowable as deduction under Section 36(1)(ii).

HC upholds long term capital gain exemption prior to set off of long term capital loss

August 4, 2013 1684 Views 0 comment Print

Issue- Whether while computing the capital gain, exemption available under the head Capital Gain should be given effect and then only the provisions for set off and carry forward of losses should be applied under the Act?

A provision is a liability which can be measured only by using a substantial degree of estimation

August 4, 2013 3095 Views 0 comment Print

The assessee’s contention is that the provision made towards the non performance guarantee is more in the nature of warranty. Thus, the company assured quality and performance and on any shortfall agreed for damages making provision based on the performance capacity

Despite Section 43(5) Exemption, Derivatives Loss Is Speculation Loss For Companies

August 4, 2013 18399 Views 0 comment Print

Did the Income Tax Appellate Tribunal (ITAT) fall into error in not holding that the loss of Rs. 4,92,71,000/- on account of derivative transaction was a speculative loss, and was entitled to the benefit of Section 73, in view of the Explanation to Section 73 of the Income Tax Act

Mere repetitive transactions in shares cannot ipso-facto make Assessee a trader

August 4, 2013 904 Views 0 comment Print

The assessee has shown Long Term Capital gains during the year at Rs. 3888,313/- which has been accepted by the AO. If the AO was of the firm belief that the assessee is engaged in trading activities in the shares then it should not make any difference if the shares are held more than 12 months

Provision for premature encashment of 8% Savings (Taxable) Bonds, 2003

August 4, 2013 559 Views 0 comment Print

Premature encashment in respect of the Bonds shall be allowed for individual investors in the age group of 60 years and above, subject to submission of document relating to date of birth of the investor in support of age to the satisfaction of the bank, after minimum lock in period from the date of issue as indicated below:-

TP : Companies With Extreme Turnover Not to be included in Comparables

August 4, 2013 607 Views 0 comment Print

It is a common case that Satyam Computer Services Ltd. should not be taken into consideration. The tribunal for valid and good reasons has pointed out that Infosys Technologies Ltd. cannot be taken as a comparable in the present case.

Jurisdiction u/s 263 can be excercised if AO fails to inquire in respect of payments liable to TDS

August 4, 2013 424 Views 0 comment Print

AO has not made any discussion regarding the subjects raised by the Ld. CIT u/s. 263 and the AO has mechanically accepted what the assessee wanted him to accept without any application of mind or enquiry. Further, no evidence had been placed that the claim made by assessee was objectively

Subsidy given for operating an industry more profitably is revenue receipt & eligible for deduction u/s. 80-IB/80-IC

August 4, 2013 700 Views 0 comment Print

Liberty India (supra) was a case of non-operational subsidy inasmuch as the subsidy, provided in Liberty India (supra), did not relate to production; whereas the subsidies, in the present set of cases, are operational in nature inasmuch as the subsidies are related to the production

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