"December, 2012" Archive

Assessment of preceding years in search cases during election period

Circular No. 10/2012-Income Tax (31/12/2012)

Circular No. 10/2012-Income Tax As per provisions contained in section 153A and 153C of the Income Tax Act, 1961, the Assessing Officer is required to issue notice for assessing or reassessing the total income for six assessment years immediately preceding the assessment year relevant to the previous year in which search is conducted or ...

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Public Notice No. 42 (RE-2012)/2009-14, Dated: 31.12.2012

Public Notice No. 42 (RE-2012)/2009-14 (31/12/2012)

In exercise of powers conferred under paragraph 2.4 of the Foreign Trade Policy 2009-2014, the Director General of Foreign Trade hereby makes the following amendments in the Handbook of Procedures (Vol. I) (Appendices and Aayat Niryat Forms) 2009-2014....

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No TDS on specified Nature of payment to Scheduled Bank

Notification No. 56/2012-Income Tax (31/12/2012)

Income Tax Government hereby notifies that no deduction of tax under Chapter XVII of the said Act shall be made on the payments of the nature specified below, in case such payment is made by a person to a bank listed in the Second Schedule to the Reserve Bank of India Act, 1934 (2 of 1934), excluding a foreign bank, namely:-...

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Notification No. 68/2012-Customs, Dated: 31.12.2012

Notification No. 68/2012-Customs (31/12/2012)

all goods, other than the goods specified in TABLE II, of the description specified in column (3) of the TABLE I here to annexed and falling under the Chapter, Heading, Sub-heading or Tariff item of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), and specified in the corresponding entry in column (2) of the said TABLE...

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Redefinition of Business Affairs through Limited Liability Partnership Route

Limited Liability Partnership (LLP) is a corporate business vehicle, identifiable by entity’s name containing 'Limited Liability Partnership' or 'LLP' as suffix, a new business structure in Indian Corporate, that enables professional expertise and entrepreneurial initiative to combine, organize and operate in innovative, flexible and ef...

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Posted Under: Income Tax |

Amendment in Concessional Duty rate of Goods imported into India from Malaysia

Notification No. 67/2012-Customs (31/12/2012)

In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby makes the following further ...

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Amendment in Concessional Duty rate of Goods imported into India from Korea

Notification No. 66/2012-Customs (31/12/2012)

In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby makes the following further amendments in ...

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Amendment in Duty rate of Goods imported into India from Japan

Notification No. 65/2012-Customs (31/12/2012)

In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby makes the following further ...

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Revised list of Items for Custom Duty Concession when imported from ASEAN Countries

Notification No. 64/2012-Customs (31/12/2012)

In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby makes the following further ...

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Duty Exemption to Crude Petroleum oils & oils obtained from bituminous minerals when imported from Brunei Darussalam

Notification No. 63/2012-Customs (31/12/2012)

Notification No. 63/2012-Customs Govt hereby exempts Crude Petroleum oils and oils obtained from bituminous minerals falling under the tariff item 2709 00 00 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), when imported into India from Brunei Darussalam, from whole of the duty of customs leviable thereon under the F...

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Amendment in Tariff value of Gold, Silver, Crude /RBD Palm Oil, Brass Scrap, Poppy seeds

Notification No. 115/2012-Customs (N.T.) (31/12/2012)

In exercise of the powers conferred by sub-section (2) of section 14 of the Customs Act, 1962 (52 of 1962), the Central Board of Excise & Customs, being satisfied that it is necessary and expedient so to do, hereby makes the following amendment in the notification of the ...

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Liaison Office (LO) / Branch Office (BO) in India by Foreign Entities – Reporting to Income Tax Authorities

A. P. (DIR Series) Circular No.24 (30/12/2012)

RBI had mandated that Branch Offices (BO) / Liaison Offices (LO) are required to submit Annual Activity Certificate (AAC) from their Auditors to the Central Office / Regional Office of the Reserve Bank, certifying that the BO / LO has carried out only those activities which are approved by the Reserve Bank. With effect from February 01, 2...

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No Penalty for showing share trading income under the Capital Gains instead of Business

CIT Vs Amit Jain (Delhi High Court)

In view of this circumstance, that the assessing officer chose to treat the income under some other head cannot characterize the particulars or reported in the return as an inaccurate particulars or as suppression of facts. ...

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Partners Remuneration cannot be disallowed as excessive if within the limit prescribed under the Partnership deed and

CIT Vs M/s Great City Manufacturing Co. (Allahabad High Court)

Whether the provisions of section 40A can be applied, in case the section 40(b) had already been applied - Whether when the partnership deed is complete with regard to all the details regarding remuneration and salary etc, disallowance can be made on the basis that it was excessive - Whether remuneration to partners should be allowed u/s...

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Ship broker is not a commission agent and not liable to Service Tax

Interocean Shipping Company Vs Commissioner of Service-Tax, Delhi (CESTAT Delhi)

A ship broker, as the name itself suggests, is essentially a broker. Ship brokers are specialist intermediaries for negotiations between ship owner and charterers who use the ship to transport some cargo or between the buyers and sellers of the ship....

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No Service tax chargeable if services not rendered in India

Commissioner of Service-Tax, Chennai Vs Heidelberg India (P.) Ltd. (CESTAT Chennai)

Respondents are not liable to pay any service tax under reverse charge mechanism on the services availed by them from their parent company as they have not paid any remuneration for the training charges. If at all any charges were paid for training outside India is not chargeable to service tax as per provisions of Taxation of Services (P...

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Service tax Penalty to be waived off when there exists no mala-fide intentions of assessee for non-payment of ST

Hindustan Aeronautics Ltd. Vs Commissioner of Central Excise, Lucknow (CESTAT Delhi)

It is not disputed by the adjudicating authority that the appellants were in correspondence with the Ministry of Finance seeking exemption on the maintenance and repair services of aircrafts pertaining to Ministry of Defence. Such correspondence resulted in denial of said request for exemption by Ministry of Finance on 26.7.2005. ...

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Internet services fall in stipulated services for sec. 80-IA deduction

Essel Shyam Communication Ltd. Vs Commissioner of Income Tax (Delhi High Court)

The assessee holds a VSAT license to establish, maintain and operate closed users group, an Internet license to establish, maintain and operate internet services and a license/permission from the Ministry of Information and Broadcasting for providing uplinking services. ...

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Deemed dividend provision not applicable on loan received from company engaged mainly in lending business

Jayant H. Modi Vs Joint Commissioner of Income Tax (ITAT Mumbai)

As provided in the said clause, any advance or loan made by a company to a shareholder or concern in which the shareholder has a substantial interest would not be regarded as a deemed dividend u/s 2(22)(e) if lending of money is a substantial part of the business of the lending company and the loan or advance is made by the lending compan...

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Whether casual contract workers can be considered as regular workers u/s. 80-IB(2)

Hindustan Colas Ltd. Vs Assistant Commissioner of Income-tax (ITAT Mumbai)

The authorities below have held that the assessee had not fulfilled the conditions relating to the minimum engagement of workers and use of new plant and machinery in setting up of industrial undertaking as required in section 80-IB(2). ...

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Share premium cannot be stated to be commercial profits to apply deemed dividend provisions

Deputy Commissioner of Income Tax Vs Radhe Sham Jain (ITAT Chandigarh)

Hon'ble Supreme Court in case of P.K. Badiani v. CIT [1976] 105 ITR 642 observed that accumulated profits would mean profit in the commercial sense and not assessable taxable profits. In that case development rebate reserve created by the company by charging profit and loss account was held to be accumulated profits though the same was li...

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Subsidy towards power generation plant is to be reduced from actual cost of plant for allowing depreciation u/s. 32

Commissioner of Income-tax, Circle -2 Vs Shree Renuka Sugars Ltd. (Karnataka High Court)

According to Explanation 10 and proviso to sub-section (1) of section 43, the subsidy amount shall be deducted in the actual cost of the asset of the assessee. Thus, the contention of the assessee that the subsidy received towards the power generation plant would not be reduced from the actual cost of the assets was not correct....

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Addition for benami property justified if property document found in possession of Assessee & not respond to summons

Commissioner of Income Tax Vs Jai Pal Aggarwal (Delhi High Court)

The Tribunal overlooked the fact that though the property dealer filed an affidavit before the Assessing Officer, but owner of the property did not respond to the summons issued by the Assessing Officer. There is no plausible explanation from the assessee why the documents relating to the property were found in his residence if he had not...

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TPO cannot be asked to establish motive behind transfer of profit before ALP determination

24/7 Customer.Com (P.) Ltd. Vs Deputy Commissioner of Income Tax (ITAT Bangalore)

It is not necessary for the TPO to demonstrate tax avoidance and diversion of tax/ income before invoking the provisions of section 92C and 92CA . To determine the arm's length nature of any international transactions. Consequently, it is wrong in attaching importance to the fact that the assessee Associated Enterprise (A.E.) is earning ...

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To claim business loss, assessee not required to establish for each successive A.Y. that it has commenced its business

Commissioner of Income Tax Vs Rio Tinto India (P.) Ltd. (Delhi High Court)

Did the Tribunal fall into error in holding that the assessment order for AY 1998-99 was conclusive on the issue of date of commencement of the assessee's business for the purpose of determining its tax liability....

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Failure to disclose expenditure on foreign travel is a valid a ground for reopening the assessment

Shumana Sen Vs Commissioner of Income Tax (Delhi High Court)

Assessing Officer in the present case, it is difficult to say that the Assessing Officer erroneously assumed jurisdiction to reopen the petitioner's assessment. The source of the complaint or the tax evasion petition is not relevant; it is the substance of the contents of the tax evasion petition which has to be examined ...

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Grant of registration u/s. 12AA is a condition precedent for claiming exemption u/s. 11

Manas Sewa Samiti Vs Additional Commissioner of Income-tax (ITAT Agra)

Since grant of registration is a condition precedent for grant of exemption under section 11 and in this case, there is no registration granted under section 12AA in favour of the assessee, no relief or exemption can be granted to the assessee under section 11. ...

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S. 271A penalty justified for non maintenance of book of account U/s. 44AF

Ashok Kumar Varshney Vs Income-tax Officer, 3(4), Hathras (ITAT Agra)

According to section 271A, if the assessee fails to keep and maintain any such books of account and other documents as required by section 44AA and the Rules in any previous year, penalty is leviable. Section 44AA(2)(i) and (ii) provides that every person carrying on business shall keep and maintain such books of account and other documen...

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For transfer of Cenvat Credit rule 10 not stipulates shifting of factory to an altogether new site

Fabrico India (P.) Ltd. Vs Commissioner of Central Excise (CESTAT Delhi)

imply On reading of Rule 10(1) of Cenvat Credit Rules, 2004, it is clear that a manufacturer of final product shall be entitled to transfer of the unutilized cenvat credit to the transferred factory provided he shifts his factory at another site and also fulfills the requirement of Rule 10(3) of Cenvat Credit Rules, 2004....

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Issue of Credit on inputs used in generating electricity for exempted goods to be decided by larger bench of SC

Commissioner of Central Excise, Vadodara Vs Gujarat Narmada Valley Fertilizers Co. Ltd. (Supreme Court of India)

In Gujarat State Fertilizers & Chemicals Ltd. (supra) a view has been taken that modvat credit can be taken on LSHS used in the manufacture of fertilizer exempt from duty. Although this decision was rendered in the context of availing modvat credit under the Central Excise Rules, 1944 as they existed prior to the promulgation of the Cenva...

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HC held seed certification work of a State Agency a business activity and denied registration

Andhra Pradesh State Seed Certification Agency Vs Chief Commissioner of Income Tax-III, Hyderabad (Andhra Pradesh High Court)

HC held that CIT had rightly rejected the application of the petitioner for approval under Section 10 (23C) (iv) of the Act on the ground that the petitioner has not rendered its services directly to the farmers but is rendering its services directly to its clients/agents who are engaged in trading of the certified seeds with profit moti...

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ICAI President’s Message – January 2013

Suggestions on Draft Rule 11UA of Income-tax Rules, 1962 Accepted: I am happy to inform you that our suggestions have found favour with the Government, which we had submitted in response to the CBDT’s request on the draft Rule 11UA for determination of fair market value for the purpose of Section 56(2)(viib) of Income-tax Act, 1961. ...

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Posted Under: Income Tax |

Documents Required for service Tax Audit

Require Document for Audit 1. Annexure I Questionnaire. 2. Annexure II List of addtional documents. 3. Annexure III FDSS. 4. Annexure IV Reconciliation. 5. Annexure V Cenvat Account Rule 9...

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Posted Under: Income Tax | ,

Shipping Business -Insurance claim will qualify for deduction U/s. 33AC only if it represents business profits of assessee

Deputy Commissioner of Income-tax Vs Mercator Lines Ltd. (ITAT Mumbai)

Whether on the facts and the circumstances of the case and in law, the learned CIT(A) has erred in directing the Assessing Officer to allow deduction u/s. 33AC on the amount of insurance claim at Rs. 1,29,09,141/- without appreciating the fact that the assessee company has reduced the repair charges on account of insurance claim receivabl...

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Direct credit of Refund/ Rebate to the Exporters’ credit by way of Electronic payment under RTGS/ NEFT facility

Trade Notice No. 16/2012-13-S.Tax (21/12/2012)

It has been brought to our notice that the present practice of issuing account payee cheques to the refund claimants is cumbersome and it also entails lot of paperwork, including return of cheques due to incomplete address and other clerical errors, leading to considerable delay in realisation of the refund! rebate amounts by the claimant...

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Two agreements with same bank details is reason good enough to to make AO believe that there has been under-assessment of income

Arun Kumar Goyal Vs Commissioner of Income Tax, Chandigarh (Punjab and Haryana High Court)

Once there are reasons for the AO to believe, whether such reasons originate out of the record already scrutinized or otherwise, he shall be within his competence to initiate the re-assessment proceedings. The formation of belief by the AO must always be tentative and not a firm or final conclusion as the latter will negate the very objec...

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Direct recruitee’s entitlement to promotion is based on year of examination and not appointment – SC

Union of India Vs N.R. Parmar (supreme court of India)

Having interpreted the effect of the OMs dated 7.2.1986 and 3.7.1986, we are satisfied, that not only the requisition but also the advertisement for direct recruitment was issued by the SSC in the recruitment year in which direct recruit vacancies had arisen. ...

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Prior to 17th March 2012 No liability to pay interest if credit wrongly taken reversed before utilization

Commissioner of Central Excise Vs Pearl Insulation Ltd. (Karnataka High Court)

The levy of interest is on the actual amount, which is withheld and the extent of delay in paying the tax from the due date. The interest cannot be claimed from the date of wrong availment of CENVAT credit and that the interest would be payable from the date CENVAT credit is taken or utilized wrongly....

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Share Trading is business activity if High volume, frequency, regularity & systematic

Assistant Commissioner of Income-tax Vs Anil Kumar Jain (ITAT Hyderabad)

Assessees have made several transactions of purchase of shares during the relevant year under consideration, and if there high volume, frequency and regularity of the activity carried on by the assessees in a systematic manner, it would partake the character of business activities carried on by the assessee in shares, and it cannot be sai...

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AO cannot rectify order passed by appellate authorities

Commissioner of Income Tax Vs V.S. Dempo & Co. Pvt. Ltd. (Bombay High Court)

In this case, the AO had not only stated that the Tribunal did not have the benefit of the decision of the Supreme Court as it was rendered earlier, but has taken liberty of criticizing the Tribunal stating that the Tribunal granted depreciation 'even though the ITAT was aware that such custom duty was not payable by a subsequent notifica...

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S. 32 Deduction for depreciation allowable irrespective of treatment in books.

Mapex Infrastructure (P.) Ltd. Vs Commissioner of Income Tax (Calcutta High Court)

While making assessment of any returns any deduction is sought for it is the duty of the revenue official to examine not only the account but also substantive right of claiming deduction under the Act on the facts and circumstances of this case. It is not a case that the said assets and properties do not belong to the appellant, therefore...

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HUDCO – Tax Free Bonds – Tax Benefits

Salient features of the bond issue (Tranche I) a. Issue Opens on – January 09, 2013 b. Issue Closes on – January 22, 2013 c. The Bonds are issued in the form of tax-free, secured, redeemable, non-convertible bonds and the interest on the Bonds will not form part of the total income as per provisions […]...

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Responsibility of Professionals Signing MCA Annual Return

W.e.f from Financial Year 2011-12, Professional (CA, CMA, CS) signing MCA Annual Return have to certify whether Cost Accounting Record Rules -2011 (CARR) or Cost Audit Orders (CAO) are applicable on company or not and mention Product or Service Category Code (ITC/ NPCS 4 Digit Code). They have to certify it on Form 23 AC and Form 23 ACA ...

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CBI arrest Income Tax officer asking for Bribe to facilitate Refund

The Central Bureau of Investigation has arrested an Income Tax Inspector and an Archivist -in-Charge of National Archives of India in separate cases of bribery. A case was registered against an Inspector of Income Tax (Circle-III), Gaya for demanding a bribe of Rs.15,000/-from the Complainant. ...

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Posted Under: Income Tax |

Company Secretaries (Amendment) Regulations, 2012 to implement New Training Structure of the ICS

Notification No. 710/1(M)/1 (29/12/2012)

The following draft of certain regulations, further to amend the Company Secretaries Regulations, 1982 which the Council of the Institute of Company Secretaries of India proposes to make, in exercise of the powers conferred by sub-section (1) of section 39 of the Company Secretaries Act, 1980 (56 of 1980), and with the prior approval of t...

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Income Tax Calculator for Govt Employees for FY 2011-2012 / 2012-13

Download Automatic Income Tax Calculator for Central & State Government Employees for the Financial Year 2011-2012 / 2012-13 and Assessment year 2012-2013/ 2013-2014....

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For income tax Purpose Working of actuarial surplus in accordance with rule 2 of First Schedule to insurance Act is valid

ICICI Prudential Insurance Co. Ltd. Vs Assistant Commissioner of Income-tax (ITAT Mumbai)

Looking at the issue in any way what is noticed is that the computation made by assessee is in accordance with rule 2 of the Insurance Act, 1938 according to which only Assessing Officer can base his computation. This also corresponds to the way incomes were assessed in earlier years, i.e., the correct method as per rule 2 and section 44....

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‘Freight beneficiary’ in a shipping business to be assessed under normal Income tax provisions and not u/s. 172

Income-tax Officer, International Taxation Vs Marine Containers Services (India) (P.) Ltd. (ITAT Rajkot)

Looking to the magnitude of the voyages undertaken by the freight beneficiary and the fact that the respondent-company has been, as observed by the ld. CIT(A), regularly filing its return of income at Mumbai and being assessed to tax at Mumbai, the finding of the CIT(A) that the freight beneficiary is not engaged in occasional […]...

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Exemption u/s. 10(23C)(vi) can be claimed without applying for registration u/s. 12A

Commissioner of Income Tax Vs Jeevan Deep Charitable Trust (Allahabad High Court)

In our considered opinion, exemption under Section 10(23C)(vi) of the Act can be claimed by an assessee without applying for registration under Section 12A of the Act as it is not required to fulfil the conditions mentioned under Section 11 of the Act while claiming exemption under Section 10(23C) (vi) of the Act. ...

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Billing System & Accounting Treatment in Case of Reverse Charge of Service Tax

CA Nitin Gupta IN CASE OF SERVICE RECEIVER IN CASE OF REVERSE CHARGE • WHERE PAYMENT IS MADE TO THE SERVICE PROVIDER, WITHIN 6 MONTHS FROM THE DATE OF INVOICE   POT = PAYMENT BASIS •WHERE PAYMENT IS NOT MADE TO THE S.P., WITHIN 6 MONTHS FROM THE DATE OF INVOICE   POINT OF TAXATION […]...

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Initiation of reassessment proceedings on basis of assessment for subsequent assessment year

NYK Line (India) Ltd. Vs Deputy Commissioner of Income Tax (Bombay High Court)

Undoubtedly an order of assessment which has been passed for a subsequent assessment year may furnish a foundation to reopen an assessment for an earlier assessment year. However, there must be some new facts which come to light in the course of assessment for the subsequent assessment year which emerge in the order of assessment....

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Year End Review of measures taken by CBDT & CBEC

24X7 Customs Clearance , Mandatory E-payment of Customs duty, E-helpline, Measures to Check Tax Evasion , Measures to Check Black , money, E-Filing of Returns, Centralised Processing Centre (CPC) , Payment of Direct Taxes Through ATMs , Online Tax Help , Communication Strategy for school children ...

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Discounting charges not amounts to interest and taxable as business income

Director of Income-tax, International Taxation Vs Cargil TSF PTE Ltd. (Delhi High Court)

The Court took into consideration the definition of 'interest' under section 2(28A) of the Act and also analysed the contents of two circulars issued by the CBDT, being No. 65 dated 02.09.1971 and the subsequent one dated 22.03.1993 (Circular No. 647)(sic), and confirmed the reasoning of the Tribunal that discounting charges did not amoun...

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Notification No. 55/2012-Income Tax Dated 28/12/2012

Notification No. 55/2012-Income Tax (28/12/2012)

Notification No. 55/2012-Income Tax Whereas the Central Government in exercise of the powers conferred by clause (iii) of sub-section (4) of section 80-IA of the Income-tax Act, 1961(43 of 1961)(hereinafter referred to as the said Act), has framed and notified a scheme for industrial park, by the notifications of the Government of India i...

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Additional evidences cannot be accepted by CIT(A) without following mandate in terms of rule 46A

Assistant Commissioner of Income-tax Vs Nirula Handicrafts Bazar (P.) Ltd. (ITAT Delhi)

In the case under consideration, the assessee placed before the ld. CIT(A), certain additional evidence and admittedly, the said documents were not submitted before the AO. The powers of the CIT(A) in terms of rule 46A to admit fresh evidence, entail an element of discretion which is required to be exercised in a judicious manner. ...

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Addition U/s. 41(1) not justified on failure of revenue to prove adjustment of liability

Smt. Victoria Roberts Vs Assistant Commissioner of Income-tax (ITAT Bangalore)

Section 41(1) is a deeming fiction and seeks to tax receipts or benefit which may not strictly be 'income', the burden to prove that a particular benefit or receipt falls within the four corners of the provisions of section 41(1) lies upon the revenue. ...

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Export commission paid to nonresident agent for taxable services outside India is not taxable in India

Deputy Commissioner of Income-tax Vs Angelique International Ltd. (ITAT Delhi)

In Divi's Laboratories Ltd.'s case (supra), it was held that commission paid to a non-resident agent for services rendered outside India is not chargeable to tax in India and that hence, no disallowance can be made....

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Definition of ‘Infrastructure Loan’ of NBFCs – Harmonisation

RBI/2012-13/351 DNBS.PD.CC.No. 317/03.10.001/2012-13 (28/12/2012)

Definition of Infrastructure Lending' in terms of which the definition of ‘infrastructure lending for the purpose of financing of infrastructure by the banks and Financial Institutions’ has been harmonized with that of the Master List of Infrastructure sub-sectors’ notified by the Government of India on March 27, 2012. It has been d...

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DGFT – Procedure for Incremental Exports Incentivisation Scheme

Public Notice No. 41/2009-2014 (RE- 2012) (28/12/2012)

An application for grant of benefit under this scheme shall be filed in ANF 3F (this ANF 3F will be notified subsequently) to RA concerned. For the purpose of the scheme, export performance shall not be allowed to be transferred from any other IEC holder. Since the benefit is admissible on realisation basis, applications can be filed afte...

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No penalty if assessee raised a bona fide claim of ‘provision for bad debts’

Deputy Commissioner of Income-tax Vs VRB Investment (P.) Ltd (ITAT Kolkata)

The difference between a write off of a debt as irrecoverable and a provision against the same on account of or for it being bad and doubtful for recovery, is not technical but factual and, further, real and not imaginary.This is more so in view of the express provision of law by way of Explanation to section 36(1)(vii), brought on statut...

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Eligibility Criteria for Incremental Exports Incentivisation Scheme

Notification No. 27(RE-2012)/2009-2014 (28/12/2012)

Incremental Exports Incentivisation Scheme -Objective (a) The objective of the Scheme is to incentivize incremental exports. Entitlement (b) An IEC holder would be entitled for a duty credit scrip @ 2% on the incremental growth (achieved by the IEC holder) during the period 01.01.2013 to 31.3.2013 compared to the period from 01.01.201...

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Nature of Hire charges for hoarding space – Is it for ‘use of premises for purpose of business’ or for publicity or advertisement or sales promotion

Bakelite Hylam Ltd. Vs Commissioner of Income-tax (Andhra Pradesh High Court)

This is a reference under section 256(1) of the Income-tax Act, 1961 (the Act). The following two questions have been referred to the opinion of this court at the instance of the assessee with reference to the assessment years 1985-86 and 1986-87....

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No Disallowance U/s. 14A if Assessee made investment from owned fund

Recently, the Mumbai Bench of the Tribunal in the case of Reliance Industries Ltd. Vs Addl. CIT [2012] 79 DTR (Trib) 315 (Mum), has rendered a very significant judgement relating to disallowance under section 14A of the Income-Tax Act, 1961 (the Act)....

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Posted Under: Income Tax |

Mere pendency of writ cannot be a ground for condoning delay of in filing appeal

Sunil Kumar Gupta Vs Commissioner of Central Excise & Customs (CESTAT Bangalore)

It is the oft-repeated submission of the counsel that the COD applications are liable to be allowed on the sole ground of pendency of their writ petition before the Hon'ble High Court. No judicial authority has been cited before us in support of the plea. We are of the view that the pendency of the writ petition filed by the appellants wh...

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Renaming of the Integrated Professional Competence Examination (IPCE)

In terms of Notification NO XCA(7)/145/2012 dated 1st August 2012, Integrated Professional Competence Examination(IPCE), stands renamed as Intermediate (IPC) Examination and would be known accordingly, with effect from May 2013 examination onwards. ...

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Posted Under: Income Tax |

Deduction u/s. 80-IA(4) available if assessee develops the infrastructure facility but do not operate or maintain the same

Assistant Commissioner of Income-tax (CC)-45 Vs Pratibha Industries Ltd. (ITAT Mumbai)

We find that, the AO accepts that the assessee is an infrastructure developer. But we look into the main objection of the AO that being a developer by itself is not enough to avail the deduction, but the assessee should have maintained, operated and handed it back to the government....

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Commissioner cannot revise order passed by TPO u/s. 92CA(3)

Essar Steel Ltd. Vs Additional Commissioner of Income Tax (ITAT Mumbai)

As seen from the provisions, the CIT has no jurisdiction over the TPO administratively and therefore, the CIT could not have revised the order under section 92C(3) passed by the TPO. ...

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Interest on deposits to be split up between its period of holding for taxation purposes

Infrastructure Development Finance Co. Ltd. Vs Joint Commissioner of Income Tax (Madras High Court)

Even though the parameter for considering the expenditure and income is not the same, yet the principle to be followed is that when the instrument concerned is certain as to its period of life and specifically points out to a particular interest amount to be paid on the maturity date, the question of assessing the entire interest in the f...

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Policy Circular No. 10 (RE-2012)/2009-14, Dated: 27.12.2012

Policy Circular No. 10 (RE-2012)/2009-14 (27/12/2012)

Para 5.11.2 of the Hand Book of Procedure Volume – 1 (HBP V-I) permits re-fixation of Annual Average Export Obligation, in case the export in any sector/product group decline by more than 5%. This implies that for the sector/product group that witnessed such decline in a licensing year as compared to the previous licensing year would be...

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Operationalisation of provisions of Para 5.11.2 of Hand Book of Procedure Vol.-1 (2009-14) [RE: 2012]

Policy Circular No. 9 (RE-2012)/2009-14 (27/12/2012)

All Regional Offices are requested to re-fix the annual average export obligation for EPCG Authorizations for the year 2011-12 accordingly. Reduction, if any, in the EO should be appropriately endorsed in the licence file of the office of RA as also in the Amendment Sheet to be issued to the EPCG Authorisation holder....

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New Company Law in the Making

Very soon, companies in India shall be governed by a new piece of legislation to be known as Companies Act, 2013 which shall replace the longest legislation of the country, the Companies Act, 1956 which is now over 56 years old. ...

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HC upheld Sacking of IPS officer for being ‘habitually in debt’

The Delhi High Court has upheld the dismissal of a 1973-batch IPS officer on the ground of misconduct and for being habitually in debt as he did not repay after taking loans from various banks....

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Posted Under: Income Tax |

Due Date for Filing Cost Audit Report in XBRL mode extended to January 31, 2013

General Circular No. 43/2012 (26/12/2012)

As per General Circular number 43/2012 dated 26.12.2012, time limit to file Cost Audit Report and Compliance Report for the year 2011-12 [including the overdue reports relating to any previous year(s)] in XBRL mode, without any penalty has been extended upto January 31, 2013 or within 180 days from the close of the company´s financial ye...

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Extension of Last date for Filing of Cost Audit and Compliance Report in XBRL mode

Keeping in view of the ongoing requests from different quarters, MCA has extended the date of filing of Cost Compliance Reports and Cost Audit Reports upto 31st Jan 2013 vide General Circular No. 43/2012 dated 26 dec 2012....

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Posted Under: Income Tax |

All delivery based transaction may not be treated as investment activity

Devji Nenshi Palani Vs Income Tax Officer (ITAT Mumbai)

High Court of Bombay had upheld the decision of the Tribunal in the case of Gopal Purohit (supra), on the ground that there was no substantial question of law involved. Even before Hon'ble High Court there was no question raised that all delivery based transactions have always to be treated as investment activity. Thus the decision of the...

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Relevant date for filing Excise Duty refund claim is date of judgment

Prontos Steerings Ltd. Vs Commissioner of Central Excise (CESTAT Delhi)

The limitation period prescribed under section 11B for filing the refund claim is one year from the relevant date. The term relevant date in the case where the duty becomes refundable as the consequences of judgment, decree, order or direction of the Appellate authority, appellate Tribunal or any Court has been defined in Explanation (B)(...

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Frequently Asked Income Tax Questions by Qualified Foreign Investors

Income tax press release (26/12/2012)

Are QFIs required to obtain PAN Card to comply with tax norms in India? What are the benefits to QFIs of having a PAN Card? How QFIs can apply for a PAN Card? Can QFIs make an On-line application for PAN Card? What are the attestation requirements for a QFI for obtaining PAN card? What are the tax related responsibilities of Qualified Dep...

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Encashment of bank guarantee amount to payment of duty / tax

Pace Marketing Specialities Vs Commissioner of Central Excise (Allahabad High Court)

In this case initially the bank guarantee furnished, was not a duty deposit in advance, but a security. After the duty was determined, the encashment of bank guarantee will amount to duty paid as the encashed bank guarantee lost its character of security....

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Transport / Rent-a-Cab service of employees to and from factory is input service

Commissioner of Central Excise, Bangalore-III Vs Tata Auto Comp Systems Ltd. (Karnataka High Court)

Whether the transportation service, provided in the factory of the M/s. Tata Auto Comp. Systems Ltd., to their staff for pick up and drop from their residence to the factory and vice versa, was an input service, in or in relation to manufacture, whether directly or indirectly of the final products within the meaning and comprehension of R...

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Payment for making logistic arrangements are not FTS even if the same require some managerial skill

Yash Raj Films (P.) Ltd. Vs Income-tax Officer (International Taxation) (ITAT Mumbai)

Learned DR contended that for providing the said services, managerial skill was also required and even the knowledge of local law was also used by the concerned service provider. In our opinion, merely because some managerial skill is required to render the services, it would not make the services to be managerial services as envisaged i...

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Search Assessment u/s.153C is Void If AO’s Satisfaction Not Recorded

Ingram Micro (India) Exports Private Limited Vs Dy. Director of Income Tax (ITAT Mumbai)

There is no satisfaction recorded by AO before initiating proceedings under section 153C. Inspite of giving sufficiently adequate time to the Revenue for production of the necessary records and considering the fact that AO refused to allow inspection to assessee as recorded by the bench on 20.04.2011, we have no option than to take an adv...

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Overview of Pharmaceutical Industry with Specific Reference to Laws Of India

The main aim of the Pharmaceutical Industry is to develop, research and distribute drugs in order to provide health care for the people in the society. Pharmaceutical companies are allowed to deal in generic and/or brand medications and medical devices. Just like any other industry, they are also subject to various rules and regulations r...

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Addition u/s. 68 justified if applicants do not respond to summons, despite submission of PAN & bank details

Commissioner of Income Tax Vs M/s. N.R. Portfolio Pvt. Ltd. (Delhi High Court)

An assessee’s duty to establish that the amounts which the AO proposes to add back, under Section 68 are properly sourced, does not cease by merely furnishing the names, addresses and PAN particulars, or relying on entries in a Registrar of Companies website....

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Selling of used cars cannot be characterized as ancillary or incidental to pharmaceutical business

Panacea Biotech LTD. Vs Commissioner of Trade and Taxes & ORS. (Delhi High Court)

In the present case, the main business of the petitioner is manufacture and sale of pharmaceutical products and the vehicles are used by it in the course of business (as written by Respondent No.-2 in the impugned order (Annexure A-1)). This may lead to the inference that proceeds from the sales of such vehicles should have been included ...

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Reopening justified if Assessee not disclosed in return of income that it was a search case

Bipinkumar P. Khandheria, Advocate Vs Deputy Commissioner of Income-Tax (Gujarat High Court)

In the facts of the present case also, it may be that if the Assessing Officer had made some efforts and examined the record of the previous assessment year, he may have come to know that this was a search and could have taken consequent action thereon. However, that by itself would not absolve the petitioner from the duty to disclose all...

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Oversight/ workload not reasonable cause to condone delay in appeal filing

Assistant Commissioner of Income-tax Vs Vimal Mehra (ITAT Delhi)

It to be settled position of law that right of appeal is neither an absolute nor an ingredient of natural justice, the principle of which must be followed in judicial and quasi-judicial adjudication. The right to appeal is a statutory right and it can be circumscribed by the condition in the grant. If a statute gives right to appeal upon ...

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Royalties & FTS are liable to tax as per Article 12 of the India-USA treaty only on payment basis

Booz. Allen & Hamilton (India) Ltd. Vs Assistant Director of Income-tax (ITAT Mumbai)

It is observed that the amount in question payable by BAH India to the USA entity was not paid during the year under consideration and there is no dispute about the same. The said amount payable to the USA entity has been brought to tax in India in its hands by the Revenue authorities as fees for technical services. As per the relevant pr...

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Penalty justified if Assessee manipulates its accounts so as to reduce its profits

Sanghvi Swiss Refills (P.) Ltd. Vs Assistant Commissioner of Income Tax (Bombay High Court)

Tribunal in the penalty proceedings has by its order, independent of the findings in quantum proceedings, has reached a conclusion that various incriminating documents found during search established that the appellant's were manipulating its accounts so as to reduce its profits. Consequently, penalty under section 271(1)(c) is imposable...

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Treatment of expense should be based on nature & not on assessee’s statement

Chamundi Steel Rolling Mills Vs Assistant Commissioner of Income Tax (Madras High Court)

It is seen from the facts that the assessee does not claim its expenditure as replacement of whole machinery or repairing of machinery as such. The assessee contended that such expenditure incurred in replacing the rolls has not in any manner increased the production capacity. On the other hand, it maintained the production capacity, as s...

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Losses from share trading through sister concern at a lowest market price are ‘artificial losses’ & not allowable

Commissioner of Income Tax Vs Vachanband Investment Ltd. (Delhi High Court)

The Revenue which is in Appeal before the Court, is aggrieved by the order of the ITAT dated 13.03.2009 in ITA-2280/Del/2005. It urges the following substantial question of law for determination by this Court...

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ICAI extends CPE hours Compliance Date to 31st January, 2013

Extension of last date for complying with the CPE hours requirement for the calendar year 2012 - from 31st December, 2012 to 31st January, 2013...

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Posted Under: Income Tax |

Notification No. GSR 926(E)-Income Tax Dated 24/12/2012

Notification No. GSR 926(E)-Income Tax (24/12/2012)

Notification No. GSR 926(E)-Income Tax In exercise of the powers conferred by section 15 of the Government Savings Banks Act, 1873 (5 of 1873), the Central Government hereby makes the following rules further to amend the Post Office Savings Account Rules, 1981, namely:— 1. (1) These rules may be called the Post Office Savings Account (...

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Public Notice No. 40 (RE-2012)/2009-2014, Dated: 24.12.2012

Public Notice No. 40 (RE-2012)/2009-2014 (24/12/2012)

In SION No. H-471 of Plastic Product Group (Product Code H) relating to export product “Polyacetal Resin Compound”, the description of Import Item No. 1 ‘Polyacetal Resin (Fluff)’ is amended to read as “Polyacetal Resin (Fluff)/Acetal Resin/Polyacetal Resin/Polyacetal”. There is no change in description of the Export Product a...

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Companies Bill 2012 The Dawn of a New Era

The Entire Corporate India Woke Up To The Morning Of 19th December 2012 With A Fresh Breeze, New Hopes And Exciting Challenges. With Just Two Days Left For The Much Hyped Armageddon Of 21st December 2012 When The World Was Supposed To End As Per A Famous Prediction, The Lok Sabha Passed The Much Awaited Companies Bill, 2012 Which Marks Th...

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Posted Under: Income Tax | ,

Taxability of IIFCL Tax Free Bonds – Issue opening on 26 Dec 2012

India Infrastructure Finance Company Limited Issue Period: 26 Dec 2012 to 11 Jan 2013 Key Benefits: Credit Ratings: AAA by CARE, AAA (Stable) by ICRA and BRICKWORK Interest on these Bonds is Tax-Free, no TDS is applicable, Wealth Tax is not levied No lock in period and no upper limit on investment amount Issue Size: […]...

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No penalty U/s. 271D for dealing in cash deposits with rural dwellers, being a reasonable cause for failure

Commissioner of Income-tax Vs Sahara India Mutual Benefit Co. Ltd. (Delhi High Court)

We have heard rival submissions and have gone through the entire material available on record. Learned DR contends that ITAT in respect of above years while upholding the deletion of penalty u/s 271-D, has not considered the aspect of each transactions while ascertaining reasonable cause. In our view it is not so in as much as ITAT has co...

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Govt exempts Janashree & Aam Aadmi Bima Yojana from service tax

Notification No. 49/2012-Service Tax (24/12/2012)

Government exempts the following two Schemes under services of life insurance business from Service tax by adding the same in mega Exemption Notification No. 25/2012-Service Tax :- (a) Janashree Bima Yojana (JBY); or (b) Aam Aadmi Bima Yojana (AABY)...

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MCA revises format of Form 18 wef 25.12.2012

Notification No. G.S.R. (E) (24/12/2012)

(1) These rules may be called the Companies (Central Government's) General Rules and Forms (Seventh Amendment) Rules. 2012. (2) They shall come into force with effect from 25.12.2012.2. In the Companies (Central Government's) General Rules and Forms, 1956, in Annexure 'A' for Form 18, the following Form shall he substituted namely:-...

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Amendment in DIN Form 4 with effect from 25.12.2012

Notification No. G.S.R. (E) (24/12/2012)

(1) These rules may be called the Companies Directors Identification Number (Third Amendment) Rules, 2012. (2) They shall some into force with effect from 25.12.2012.2. In the Companies (Directors Identification Number) Rules, 2006, In Form DIN - 4, the certification column after serial no. 17, the following 2nd para of the certification...

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