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SC judgement regarding allowance of expenses incurred for obtaining loan along with interest on loan

May 13, 2021 2076 Views 0 comment Print

In principle , apart from any statutory provisions, there is no distinction as drawn by the revenue , between interest in respect of a loan and an expenditure incurred for obtaining the loan . It is erroneous to consider a liability as an asset or an advantage. The nature of the expenditure incurred in raising […]

Books of Accounts Are Not Decisive or Conclusive For A Particular Deduction If Otherwise Allowable As Per Existing Law

May 12, 2021 6288 Views 0 comment Print

Whether the assessee is entitled to a particular deduction or not will depend on the provision of law relating thereto and not on the view which the assessee might take of his rights nor can the existence or absence of entries in the books of accounts be decisive or conclusive in the matter .The following […]

Actual cost to Plant & machinery before start of production in absence of statutory definition

May 12, 2021 5283 Views 0 comment Print

Actual cost to Plant & machinery before start of production in absence of statutory definition The accepted accountancy rule for determining the cost of fixed assets is to include all expenditure necessary to bring such assets into existence . Interest paid on money borrowed before start of production shall increase the cost of the asset […]

An assessee can so arrange his affairs to minimize his tax burden

May 11, 2021 1911 Views 0 comment Print

A well accepted Principle of law On going through the judgement of the Hon,ble Supreme Court in CIT, West Bengal Vs. Calcutta Discount Co. Ltd. Decided on 10.04.1973, we find two very important aspects decided by this court . 1. No specific formula is necessary for seeking relief at the hand of any court or […]

Reason to believe not valid if after 01.04.1989, if it lacks application of Mind & Material

May 10, 2021 1614 Views 0 comment Print

Application of mind & availability of material must for Reasons To Believe under section 147 of The Income Tax Act, 1961 Wef 01.04.1989. Article compares Section 34 of Income Tax Act, 1922 with Section 147 of Income Tax Act, 1961 and also compare Section 147 of Income Tax Act, 1961 with Amendment made vide Amendment […]

Tribunal a final fact finding body can be assailed if acted without material & prescribed procedure

May 7, 2021 1020 Views 0 comment Print

Understanding the role of a tribunal as a fact-finding body and the circumstances under which its findings can be challenged.

No penalty u/s 271B of the Act when no books of accounts were maintained

April 29, 2021 11193 Views 2 comments Print

Understanding the implications of not maintaining books of accounts under section 271B of the Income Tax Act. Learn about the penalties and favorable judgments.

Section 271(1)(c) Penalty when income determined by AO on estimation

April 29, 2021 117597 Views 0 comment Print

Understanding the penalty provisions under section 271(1)(c) of the income tax Act, 1961 when income is determined by AO through estimation.

AO cannot decide competence of doing Business of Assessee

April 28, 2021 3699 Views 0 comment Print

The nature of business of the assessee can not be challenged by any authority whether assessee is competent of doing the business or not competent. It is the assessee who has to decide how to earn the Income. It is the choice of the assessee what type and of what nature he/she does the business […]

Work in progress cannot be treated as a part of turnover

April 28, 2021 10041 Views 0 comment Print

Work in progress is never a part of the turnover. Guidance Note on Tax Audit under Section 44AB of the Income-tax Act, 1961 and penalty issue u/s 271B of the Income Tax Act ,1961 During the assessment year 2011-12 the turnover of the assessee was Rs. 639706.00 and work in progress was Rs. 16559480.00. Work […]

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