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Archive: 15 October 2011

Posts in 15 October 2011

Live Course on Appeal, Pleading & Drafting under GST by CA Sachin Jain

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Nature of expense not changes due to treatment of same in books of account

October 15, 2011 5740 Views 0 comment Print

ACIT Vs. Parablic Drugs Ltd. (ITAT Delhi) – It has to be held that all of these expenditure were incurred by the assessee in the course of its business and none of the expenditure can be classified as expenditure in the nature of capital. The case law relied upon by the ld. AR supports the case of the assessee. Therefore, we found no infirmity in the order of CIT(A) vide which the assessee has been held eligible for deduction of these expenditure under both the sections either u/s 35(1)(i) or u/s 37(1) of the Act.

Payment of statutory liabilities/miscellaneous expenses, etc made by the assessee to the C & F agency not covered u/s 194C

October 15, 2011 7418 Views 0 comment Print

ACIT Vs M/s P P Overseas (ITAT Mumbai) – Statutory liabilities such as customs duty, DEPB licence etc. which is actually the liability of the assessee and the receipt for the payment is issued by the concerned authority only in the name of the assessee. The C & F agents merely collected the payments from the assessee for payment to the concerned authorities. Such payments cannot be considered to be covered by section 194C as they are not for any work of the nature mentioned in Explanation III.

HC rules on the meaning of full value when assets attached with liabilities are received by shareholders as proceeds from liquidation

October 15, 2011 717 Views 0 comment Print

CIT Vs Shri Nayan Arvind Shah (Bombay High Court)- Whether the value of the assets, for the purpose of computation of capital gains in the hands of the shareholders in respect of assets received from the liquidator of a company, should be taken at the fair market value (FMV) or at the FMV as reduced by the liabilities attached to it. It was held that the FMV, as reduced by the liabilities attached to it, forms the basis for computation of capital gains.

Section 40 (a) (ia) applies even in respect of amount paid & not merely payable to contractors

October 15, 2011 1133 Views 0 comment Print

Valibhai Khanbhai Mankad vs DCIT (ITAT Ahmedabad) -Whether CIT(A) has erred in confirming the dis-allowance of Rs. 7,93,34,193/- u/s 40(a)(ia) on the ground that the assessee has filed Form No. 15J with CIT on 26.02.2009 instead of on or before 30th June, 2006 in as much the there is no failure to deduct tax at source under section 194C since the assessee has received Form No.15-I from the sub-contractors before making payment to them. Held , No The decision on deductibility of tax on payment made to sub-contractor is to be taken at time when contractor is releasing payments to sub-contractors and it is at that point of time second proviso to section 194C(3)(i) would come into play and when Form No. 15-I are submitted by sub-contractors to contractor, then contractor is not required to deduct tax from such payments, whereas compliance of third proviso can be deferred till 30th June of next financial year.

Stamp duty paid during the course of amalgamation and compensation paid to employees under VRS scheme is deductible as revenue expense

October 15, 2011 5639 Views 0 comment Print

These cross appeals are directed against separate orders of the CIT(A) relating to the assessment years 1998-99 and 1999-2000, respectively. The appeals arise out of the assessments made under section 143(3) of the Income tax Act, 1961. As they involve some common issues, they were heard together and are being disposed of by this common order for the sake of convenience.

Assessee not eligible for deduction u/s. 80RRA if the technical services provided by the assessee are not approved by the Govt.

October 15, 2011 1181 Views 0 comment Print

P A Chacko Muthalaly Vs ACIT (ITAT Mumbai)- If the approvals of the technical services have not been granted, obviously then assessee is not entitled for deduction u/s. 80RRA. The Tribunal cannot go beyond its scope to hold that CBDT was not correct in refusing the permission for which assessee could have taken appropriate steps before the Honourable High Court. In the light of this discussion we are of the view that assessee is not entitle for deduction u/s.80 RRA.

Payment made by the assessee to the society as society maintenance expenses are not covered under section 194C

October 15, 2011 73176 Views 2 comments Print

Mitsutor Shipping Agency Pvt Ltd Vs DCIT (ITAT Mumbai)- The assessee was owner of the premises in which it was carrying on business. The assessee paid maintenance charges to the society of Apartment Owners. According to the AO the assessee ought to have deducted tax at source on the payment of maintenance charges to the society as the payment by the assessee to the society was in the nature of contract and, therefore, the provisions of section 194C was applicable.

Assessee not eligible for deduction u/s 80IB on the amount disallowed by AO due to delayed payment of employee’s contribution of P.F

October 15, 2011 598 Views 0 comment Print

ITO Vs Millenium Writing Products Pvt Ltd. (ITAT Kolkata) Deduction u/s. 80IB of the Act is available to an assessee whose gross total income includes any profits and gains derived from eligible business as specified in the section. Here the assessee is claiming deduction on an item of disallowance made by the Assessing Officer on account of employees’ contribution to PF, which was not deposited within the due date. This is neither an item of profit or gain of eligible business nor an item of Profit & Loss Account or manufacturing account rather it is just an employees’ contribution to PF, which assessee has to collect from its employees and to deposit with the PF authorities within the due date prescribed.

When assessee has given his address in the e-return and the AO has also given TDS credit on the same, AO is not right in serving notice u/s 143(2) by affixting the same on some other address

October 15, 2011 1627 Views 0 comment Print

The revenue is in appeal against the order dated 03.09.2009 passed by ld. CIT(A) in the matter of assessment made by the Assessing Officer u/s 144 of the Income Tax Act, 1961 for the A.Y. 2006-07.

Under project completion method entire project as a whole is to be seen and hence transfer of some flats via registration is not conclusive of the year in which the income attributable to the project is to be taxed

October 15, 2011 4491 Views 0 comment Print

M/s Maitri Developers Vs ITO (ITAT Mumbai)- Project completion method is well recognised method as per AS-7. Under project completion method entire project as a whole is to be seen and hence transfer of some flats via registration is not conclusive of the year in which the income attributable to the project is to be taxed. Completion certificate is also not conclusive of the fact that the project was completed when the facility of drinking water shows it otherwise.

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