1. Hasan Ali Khan vs. ITSC (Bombay High Court) – (i) The Chairman of the Settlement Commission has the power to constitute a Special Bench and he is not required to give reasons or produce the material in support thereof. (ii) It is not as if the moment an application is made and there is compliance of the requirements of Section 245-D that the Commission is bound to entertain the application and allow it. The Commission has then to consider whether the application is invalid under Section 245-D(2C). The Settlement Commission can treat the application as invalid meaning thereby non – est if the Applicant has not made a true and full disclosure and further must disclose how the income has been derived. If on the material it arrives at a conclusion even prima facie that there was no true and full disclosure it has then the right to declare the application as invalid.

Ranbaxy Laboratories Ltd. v. Additional Commissioner of Income-tax Section 92C, read with section 92CA, of the Income-tax Act, 1961 – Transfer pricing – Computation of Arm’s length price – Assessment year 2004-05 – Whether Assessing Officer in light of Instruction No. 3 of 2003, dated 20-5-2003 of CBDT is duty bound to refer matter to transfer pricing officer of international transaction exceeding Rs. 5 crores, having regard to purpose of specialized cell created by revenue department to deal with complicated and complex issues arising under transfer pricing mechanism – Held, yes

RBF Rig Corpn. LIC (RBFRC) v. ACIT (ITAT Delhi) -Section 10(10CC) of the Income-tax Act, 1961 – Perquisite, not provided by monetary payment – Assessment year 2004-05 – Whether payment of tax on behalf of employee at option of employer is a non-monetary perquisite fully covered by sub-clause (iv) of clause (2) of section 17 and, thus, exempt under section 10(10CC) and is not liable to be included in total income of employee – Held, yes – Whether taxes paid by employer can be added only once in salary of employee and thereafter, tax on such perquisite is not to be added again – Held, yes

Under section 254(2) of the Income-tax Act, 1961, the Tribunal has the power to rectify mistakes in its order. However, the power to rectify a mistake is not equivalent to a power to review or recall the order sought to be rectified. Rectification is a species of the larger concept of review. Although it is possible that the prerequisite for exercise of either power may be similar to rectifying a mistake apparent from the record, by its very nature, the power to rectify a mistake would not result in the recall and review of the order sought to be rectified. This was held by the Delhi High Court in C.I.T. v Hindustan Coca Cola Beverages P Ltd (293 I.T.R. 163).

The Supreme Court directed tax payers all over the country to file Income Tax returns under the prescribed new ITR forms for assessment year 2007-08 by February 29, 2008 – the new deadline set by the government. The direction was passed after Additional Solicitor General Mohan Parasaran informed the bench headed by Justice B N Agarwal that the Centre was issuing a notification today extending the time for filing returns till February 29, next year in relation to all categories of assessees.

CIT vs. P.V.A.L. Kulandagan Chettiar (Supreme Court) -The review petition filed by the department against the judgement reported in CIT P.V.A.L Kulandagan Chettiar (2004) 267 ITR 654 (SC) {reg applicability of DTAA} has been dismissed.

As you are kindly aware, the Central Board of Direct taxes came out with the new series of Income-tax return forms. The ICAI constituted a study group to analyze the same. Several suggestions, collected from all over the country and duly analysed were submitted to the CBDT. The CBDT accepted most of the suggestions of [...]

the Court direct the department to accept the return Forms which are submitted by the taxpayers, sub­ject to a genuine difficulty. After acceptance of those return Forms, on scrutiny if it is found by the concerned officer that there is no genuine difficulty on the part of the taxpayer in giving the details required in various columns, those Forms may finally be treated as not filed as required, and they will be subject to final decision taken by the concerned officer. Howev­er, it is also made clear that if under the rules no Annexures are required to be attached then no Annexures shall be attached to the return Form.

Hope all of you are familiar with efiling of ITR – 1, 2, 3, 4, &5. I have a message for you…. IT people (You may call them Income Tax People or Inefficient Taxman) are not very clear about Circular No. 5 – 2007. I find it very difficult to convince them that their department has enabled efiling and it is also sufficient to submit a verification form in ITR – V, they are blissfully ignorant about their department’s STATE OF THE ART!!!!!!!!!!! Technology in infusion of Information Technology at the service of Taxpayer!

Om Prakash Tewari v. Union of India – Section 139 of the Income-tax Act, 1961, read with rule 12 of the Income-tax Rules, 1962 – Return of income – General – Assessment year 2007-08 – Petitioners, lawyers/advocates, chal­lenged Income-tax (Fourth Amendment) Rules, 2007 which amended rule 12 and introduced new tax return Forms ITR-1 to ITR-8, and contended that Saral 2D Form is easiest way of filing returns which petitioners are using for filing their income-tax returns for last several years and new Forms are against mandatory provisions of section 139 – Whether Forms in question introduced by Government are applicable for year in question only and, therefore, as an interim measure, if returns are filed by petitioners and assessees in Saral 2D Form same shall be entertained by authorities and shall not be rejected on ground that same are not in prescribed Forms ITR-1 to ITR-8 Held, yes