"10 June 2012" Archive

Negative goodwill arising on amalgamation credited to General reserve not taxable

Spencer and Company Ltd. Vs ACIT (ITAT Chennai)

The Chennai Tribunal in the case of Quintegra Solutions Pvt. Ltd., had considered the applicability of Section 28(iv) of the Act in the case of amalgamation. In that case the CIT(A) held that differential amount between share issued and net assets taken over, being balancing figure, did not represent income assessable under Section 28(iv)...

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No interest can be charged if not mentioned in assessment order

Commissioner Of Income Tax Vs Sarin Chemical Laboratory (Allahabad High Court)

Interest u/s. 234A, 234B and 234C cannot be charged in the absence of any mention of charging of interest in assessment order - The High Court observed that in the case of Anjum M. H Ghaswala the Supreme Court has held collection of interest under Section 234A, 234B and 234C of the Act was mandatory. The High Court relied on decision of D...

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Reduction of share in the firm of existing partners, on admission of new partners, not taxable as capital gains

CIT Vs P.N.Panjawani (Karnataka High Court)

The Karnataka HC has held that the reduction in the share of partners after the reconstitution of partnership firms does not amount to a taxable transfer. Further, it reaffirmed that, tax planning within the frame work of law is permitted.The principles laid down in this decision can also be applied to the limited liability partnerships, ...

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Sale of development rights taxable in the year of transfer though consideration is received in subsequent years

Hillside Construction Company. Pvt. Ltd. Vs Dy. Commissioner of Income tax (ITAT Mumbai)

The taxpayer instead of developing the land, transferred the development rights in respect of part of the land to a separate construction company.As per the agreement, the taxpayer jointly with the trust was required to convey the land to the proposed buyers. Instead of developing land, the taxpayer parted with the development rights in r...

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No Disallowance of expense under S. 40(a)(i) for payment of Expense to American Resident without deduction of Tax

Dy. CIT Vs M/s Incent Tours Pvt. Ltd. (ITAT Delhi)

Provisions of section 40(a)(i) as it existed prior to it's amendment by Finance Act, 2003, with "effect from 1-4-2004 provided for disallowance of payment made to a non-resident only where tax is not deducted at source' on such payment at source. A similar payment to a resident does not result in disallowance in the event of non-deductio...

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Withdrawal of Exemption under Customs Act does not make assessee non-charitable

St. Stephen’s Hospital Society, Vs Director of Income Tax (ITAT Delhi)

As regards allegation of Withdrawal of exemption from Import Duty, it has been submitted that import of medical equipment had taken place in 1990 and does not pertain to the period under discussion. The duty exemption was withdrawn citing certain noncompliance, assessee has filed appeal before CESTAT challenging the order of withdrawal an...

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Now, pay income tax dues at banks

In order to avoid the last-minute rush for customers paying their income-tax dues, the Reserve Bank on Friday said tax payers may use select branches of some public and private sector banks to remit their dues in advance. Some of the branches of State Bank of India, State Bank of Travancore, State Bank of Hyderabad, State Bank of Mysore, ...

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Posted Under: Income Tax |

In the absence of specific valuation of assets/liabilities and goodwill, depreciation on goodwill created in the books of account at the time of amalgamation not allowable

DCIT v. Toyo Engineering India Ltd. (ITAT Mumbai)

ITAT Mumbai in this case was of the view that the perusal of AS 14 does not support the contention of the taxpayer that the investment by the taxpayer over the net assets taken over should be treated as goodwill. It was held that unless the fair valuation of assets, including any goodwill, is carried out and investment is earmarked toward...

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