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Archive: 12 June 2015

Posts in 12 June 2015

Sale proceeds of Flags on Women’s Day Pursuant to govt. order are capital receipts

June 12, 2015 772 Views 0 comment Print

Assessing Officer found that the assessee has received a sum of Rs. 29,03,109/- on account of sale of Women’s Day Flags and the same has been credited to the capital fund and he treated the same as revenue receipt. On Appeal Honourable ITAT has held that sale proceeds of flags on Women’s Day are in the nature of capital receipts.

Date of credit in books is actual date of recording credit entry for determining point of TDS deduction liability

June 12, 2015 11307 Views 0 comment Print

According to the learned counsel for the department, the assessee company as per the provisions of section 195(1) was liable to deduct tax at source from the payment made to a non-resident of any sum chargeable under the provisions of the Act at the time of credit of such income to the account of the payee or at the time of payment

Section 68- Trade credits cannot be taxed as unexplained cash credit

June 12, 2015 3330 Views 0 comment Print

Assesse submitted, the additions made as cash credits being in nature of trade credits on account of purchase of sunflower seeds, thus, are not in the nature of cash credits as envisaged under section 68 and the same therefore cannot be added to the income of the assessee by invoking the said provision.

Penalty u/s 271(1)(C) can’t be levied in succeeding year if on similar/ identical disallowance, no penalty was levied in preceding year

June 12, 2015 1855 Views 0 comment Print

In the case of Asst Commissioner of Income Tax vs. Dhariwal Industries Ltd, Hon’ble ITAT has held that once issue on which penalty u/s 271 (1)(C)levied involves substantial question of law, then, no penalty is leviable.

Discount to distributors by telecom company is not in the nature of commission/brokerage

June 12, 2015 5055 Views 0 comment Print

Discount to distributors by Telecom Company is not in the nature of commission/brokerage and the roaming charges paid to other telecom operators are not in the nature of fee for technical services.

Non-compliance in respect of hived off part of project does not dis-entitle deduction under Section 80IB(10)

June 12, 2015 528 Views 0 comment Print

ITAT Hyderabad in the case of Smt. Cherkuri vs. DCIT concluded that development of commercial complex by the buyer of plot area even if it is approved by the concerned authorities as the part of the project, could not be said to have been developed by the assessee as a part & parcel of the project.

Adjustment for variation in closing stock necessary for correct application of TNMM

June 12, 2015 1435 Views 0 comment Print

ITAT Licknow in the case of ACIT vs. M/s Rahman Industries Ltd. held that- Adjustment for variation in closing stock is necessary for the correct computation of Operating cost thereby correct application of Transaction Net Margin Method (TNMM).

Broken period interest on purchase of securities is allowable as revenue expenditure

June 12, 2015 5904 Views 0 comment Print

The ITAT after considering the rival submissions observed that both the counsels agreed before us that the issue in dispute is squarely covered by the decision of the Tribunal in assessee’s own case for AY 2010-11 in ITA No. 1742/Hyd/2014 dated 25/03/2015

Other View taken by Assessing Officer with application of mind even if prejudicial to interests of Revenue does not allow CIT to initiate proceedings u/s 263

June 12, 2015 530 Views 0 comment Print

Phrase prejudicial to the interests of the Revenue had to be read in conjunction with an erroneous order passed by the AO, that every loss of revenue as a consequence of an order of the AO cannot be treated as prejudicial to the interests of the Revenue,

Books cannot be rejected when PAN mentioned and TDS was deducted

June 12, 2015 1839 Views 0 comment Print

In the case of VV Constructions v ACIT, ITAT Pune held that the Books of account cannot be rejected for only the reason that there was some over writing in one of the transactions. Also, it can’t be rejected because the Assessee have furnished the PAN numbers and made TDS in all the transactions

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