"21 October 2012" Archive

Matter remanded if additions are made by TPO without working capital adjustments

Cowi India (P.) Ltd. Vs Assistant Commissioner of Income-tax, Gurgaon Circle-1 (ITAT Delhi)

The assessee made a claim for working capital adjustment before the TPO. The TPO made a detailed analysis exhibiting how such an adjustment is to be granted. According to the assessee, the TPO made reference to Rule 10B(3) demonstrating comparability adjustment. On the strength of this Rule, the TPO opined that Indian transfer pricing pro...

Carry forward business losses & depreciation cannot be set off against profits of an undertaking while working out claim u/s. 10B

ASB International (P.) Ltd. Vs Deputy Commissioner of Income tax, Circle-1 (ITAT Mumbai)

Since the provisions of section 10A and 10B are similar in nature and as the jurisdictional High Court decided the issue while considering the provisions of section 10B also respectfully following the above, we uphold the contention of assessee that carry forward business losses and depreciation cannot be set off to the profits of the und...

AO Can not change his opinion regarding need for special Audit unless new fact emerges

DLF Commercial Projects Corporation Vs Assistant Commissioner of Income-tax (Delhi High Court)

It is necessary to examine the question whether it is open to the Assessing Officer, having already formed an opinion that no special audit was necessary, and not having communicated the same to the petitioner, to change his mind and form an opinion subsequently that a special audit is necessary having regard to the complexities of the ac...

If Trust conducts marathon in commercial manner, then it cannot be said to be existing only for charitable purposes

Hyderabad Runners Society Vs Director of Income-tax (Exemptions) Hyderabad (ITAT Hyderabad)

The voluntary contribution received by a trust created only for charitable or religious purposes is to be deemed as income u/s. 11 of the Act. In case some of the objects of the trust are charitable and some of the objects can be termed as non charitable then such a trust will not be covered u/s. 12 because then it is not a trust created ...

No Capital gain tax firm if it doesn’t distribute any capital asset to retiring partners

Income-tax Officer - 25(3)(4) Vs Fine Developers (ITAT Mumbai)

Allocation of assets of the firm to the retiring partners is the basis for invocation of provisions of Section 45(4). In the case under consideration, neither there was any dissolution nor other event took place that had an effect of allocation of exclusive interest in any capital asset to the retiring partners. In these circumstances, FA...

Request of director for postponement of board meeting must be treated as leave of absence & not vacation of office

Sanjay Suryaprakash Mehta Vs SKG Consultants & Engg. (P.) Ltd. (Company Law Board, Mumbai)

It is a fact that the company holds three board meetings consecutively on March 31, 2011, June 9, 2011 and September 29, 2011. It is also a fact that the petitioner has challenged the validity of the board meeting dated March 31, 2011. Even otherwise, the petitioner has requested the company to postpone the meeting dated March 31, 2011 to...

Vicarious liability of director of a private company for ‘tax due’ u/s. 179(1) from it does not extend to interest & penalty

Maganbhai Hansrajbhai Patel Vs Assistant Commissioner of Income-tax (Gujarat High Court)

Section 179(1) provides for a vicarious liability of the director of a public company for payment of tax dues which cannot be recovered from the company. However, such liability could be avoided if the director proves that the non recovery cannot be attributed to any gross negligence, misfeasance or breach of duty on his part in relation ...

If DRP dismissed objections filed by assessee in a summary manner without proper application of mind, matter needed reconsideration

Panasonic Consumer India (P.) Ltd. Vs Assistant Commissioner of Income-tax (ITAT Delhi)

The giving of reasons in support of their conclusions by judicial and quasi-judicial authorities when exercising initial jurisdiction is essential for various reasons. First, it is calculated to prevent unconscious, unfairness or arbitrariness in reaching the conclusions. The very search for reasons will put the authority on the alert and...

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