"29 July 2012" Archive

Proportionate Interest on amount transferred to group concerns without commercial expediency not allowable

Poabs Rock Products (P.) Ltd. Vs Deputy Commissioner of Income-tax (ITAT Cochin)

On the contrary, the ld. representative for the assessee submitted that the definition of "manufacture" was introduced by Finance Act, 2009. The assessment years under consideration are 2006-07 and 2007-08, therefore, the definition introduced by Finance Act, 2009 is not applicable to the facts of the case. For the earlier assessment year...

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In cases where principle of mutuality applicable, registration u/s. 12AA cannot be cancelled simply by relying on first proviso to S. 2(15)

Bombay Presidency Golf Club Ltd. Vs Director of Income-tax (Exemptions) (ITAT Mumbai)

The assessee is a club and all its activities are restricted to among its members and, therefore, 'principle of mutuality' applies in the instant case. It has been clarified by the Board vide its Circular No. 11 of 2008, dated 19-12-2008 that in such cases where principle of mutuality are applicable, registration cannot be cancelled simp...

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HC may sanction non tax neutral demerger

The contention urged by the Applicant that the Scheme of Demerger must necessarily comply with Section 2(19AA) which is meant for availing tax concession cannot be read as a mandatory requirement for all schemes of amalgamation / arrangement/de-merger under Sections 391/392/394 of 1956 Act . The said provision cannot be read and interpret...

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I-T Dept detects undisclosed income of Rs. 565 crore

Income Tax authorities say, undisclosed income of Indians totalling 565 crore rupees has been detected in France. The figure was disclosed in the information that India received from France on Indians having bank accounts, under the exchange of information clause of the Double Taxation Avoidance Agreement (DTAA) with the European country....

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Posted Under: Income Tax |

Amendment to DTAA can’t be given retrospective effect unilaterally

Abu Dhabi Commercial Bank Ltd. Vs ADIT (IT) - 1(1), Mumbai (ITAT Mumbai)

It is a cardinal principle, when two sovereign nations enter into an agreement and have come to an understanding regarding the terms, views expressed in the agreement, such terms cannot be unilaterally changed. Once the Government of India and Government of UAE had not used the limitation clause of applicability of domestic law in determi...

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TDS on transport charges deductible u/s. 194C not 194I

Asstt. Commissioner of Income Tax(TDS), Vs M/s Idea Cellular Limited (ITAT Delhi)

U/s 194-I, Income Tax is required to be deducted at source at the time of payment of any income by way of rent @' 10% for the use of any machinery or plant or equipment. U/s 194C, tax is required to be deducted @' 2% for carrying out any work which, inter alia, includes carriage of goods and passengers by any mode of transport other than ...

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Voluntary Retirement -Allowability of exemption u/s 10(10C) & rebate u/s 89

Shri Manmohan Singh Bedi Vs A.C.I.T. (ITAT Chandigarh)

Voluntary Retirement - Assessee can claim both exemption u/s 10(10C) & rebate u/s 89- The assessee is entitled to the exemption under section 10(10C) of the Act and also rebate under section 89 of the Act in respect of the amount received in excess of Rs.5,00,000 on account of voluntary retirement. Thus their Lordships have held that the ...

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Penalty for concealment of income cannot be imposed for Mere disallowance of expenses

M/s. Vidhya Synthetic (I) Pvt. Ltd. Vs Dy. Commissioner of Income Tax (ITAT Mumbai)

Where there is no finding that any details supplied by the assessee in its return are found to be incorrect or erroneous or false there is no question of inviting the penalty under section 271(1)(c). A mere making of a claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the inc...

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Interest Paid on loan advanced to related concerns for business purpose allowable

Sh. Rajiv Jain Vs Income Tax Officer (ITAT Delhi)

Assessee has submitted in this case that advance was given amounting to Rs. 39,36,860/- to M/s Kohinoor International and interest was charged @ 6%. It was further claimed that the said advances were given out of the partners capital which was Rs. 30,91,322/- as on 31.3.2007. Furthermore, assessee has contended that there were comm...

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ITAT allows Deduction u/s.80IB(10) on partially complete project

M/s. Ramsukh Properties Vs. Dy CIT (ITAT Pune)

Assessee is a firm engaged in business of builder and promoter. The issue before us is regarding allowability of deduction u/s.80IB(10) of the Act on partially complete project. The Assessing Officer has denied the deduction on the ground that project was not complete within the stipulated time. There is no dispute with regard to other co...

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TDS on Payment to Google Ireland Ltd. for banner advertisement?

Pinstorm Technologies Pvt. Ltd. Vs ITO (ITAT Mumbai)

During the year under consideration, the assessee company had made a payment of 1,09,35,108/- to Google Ireland Ltd. and the said amount was claimed as 'advertisement expenditure'. While making the said payment, no tax at source was deducted by the assessee on the ground that the amount paid to Google Ireland Ltd. constituted business pro...

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RBI Norms cannot override Income Tax Provisions

All Bank Finance Ltd. Vs. Deputy Commissioner of Income-tax (ITAT Kolkata)

It is a fact that assessee has not booked the lease rentals as noted by the AO but on the reason that the assessee being NBFC is following the guidelines issued by RBI and guidelines states that once the party has become a defaulter for at least twelve months that party can be declared as NPA and no income on that part can be booked from ...

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GAAR Is Extraordinarily Broad & too Vague – USCIB

USCIB believes that the proposed guidelines are too vague to provide certainty to business investors. For example, an important part of certainty is respecting the obligations imposed by double taxation agreements between treaty partners. Treaty obligations should generally not be overridden by GAAR provisions. If India chooses to overrid...

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Posted Under: Income Tax | ,

No Penalty if wrong claim caused by bona fide mistake

CIT Vs Societex (Delhi High Court)

The provision made for advance tax of Rs.23,50, 000/- debited in the P&L account not added back to income is bonafide mistake. Assessee paid advance tax in the month of March only. It is the first time that provision was debited in P&L account. Had there been any intention to file inaccurate particulars then the assessee could not have pa...

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S. 54 Constructed house of members cannot be deemed to be of society

M/s Asha Pushp Vihar Sahkari Awas Samiti Limited, Vs (i)Additional Commissioner of Income Tax (ITAT Delhi)

The assessee’s claim of exemption u/s 54 is devoid of merits as the concept of mutuality has not been extended to the assessee besides the constructed houses or the properties of the respective members cannot be deemed to be purchased or construction of the houses belonging to the society. In view thereof, the claim u/s 54 has been righ...

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