Income Tax judiciary-2

Exemption U/s. 11 cannot be denied merely for Running of bus by School to facilitate transportation of students & staff

Delhi Public School Ghaziabad Vs ACIT (ITAT Delhi)

Where assessee-school had provided transport facility by charging separate fee, the transportation activity being incidental to achieve the main object of the assessee-trust, i.e., providing education could not be considered as business activity, so as to deny exemption under section 11 because the transport facility was not provided to o...

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Reopening u/s 148 not sustainable in absence of reason to believe that income has escaped assessment

DCIT V/s. M/s Kargwal Products P. Ltd. Vs (ITAT Mumbai)

Basic requirement of reopening of assessment is ‘reason to believe’ that the income has escaped assessment without which reopening under Section 148 of Income Tax Act, 1961 is is not sustainable ...

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Capital gain assessable in the hands of legal heirs who inherited the land and shared sale consideration

Sushila Devi Meena Vs ITO (ITAT Jaipur)

Capital gain to be assessed in the hands of all the legal heirs who have inherited the land and also shared the sale consideration. Cost of acquisition has to be determined by considering relevant provisions of the Act as well as the fair market value of the land as on 01.04.1981....

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AO must prove that sale of agricultural land is in the nature of trade to tax gain as business income

Pr. CIT Vs Heenaben Bhadresh Mehta (Gujarat High Court)

Sale of Agricultural Land by the assessee was not 'adventure in the nature of trade' and therefore, profit earned on such sales cannot be taxed as business income....

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Addition cannot be made for Share Capital as undisclosed Income merely on surmises

ACIT Vs Gowthami Chemicals & Pesticides (P) Ltd. (ITAT Visakhapatnam)

ACIT Vs Gowthami Chemicals & Pesticides (P) Ltd. (ITAT Visakhapatnam)  In this case, the assessee has furnished the confirmation letters explaining the identity of the shareholder, address and sources of income of the contributor to the share capital along with the evidence for land holdings and copies of IT returns in 4 cases before...

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Cash Loan- Penalty justified on failure to establish Business exigency or urgency 

M. Sougoumarin Vs ACIT (Madras High Court)

M. Sougoumarin Vs ACIT (Madras High Court) High Court held that there was no such reason for regular loan transactions of borrowing and repayment in cash of amounts exceeding Rs.20,000/- so as to escape penal liability under Sections 271E and 271D of the IT Act. FULL TEXT OF THE HIGH COURT ORDER / JUDGMENT These […]...

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Addition for LTCG on mere surmises not justified

M/s. J.V.S. Foods Pvt. Ltd. Vs DCIT (ITAT Jaipur)

Denial of assessee’s claim under section 10(38) on the basis of suspicion without any cogent material to show that the assessee had brought back its own unaccounted income in the shape of long-term capital gain was not justified....

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Re-Opening not allowed for issue Investigated during original assessment

Nu Power Renewables Pvt. Ltd. Vs ACIT (Bombay High Court)

The channel of movement of the fund, the source of the fund, purpose of investment and the ultimate destination of the fund, were all part of the record during the assessment proceedings. There is nothing in the reasons recorded by the Assessing Officer to suggest that, such investment is bogus....

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HC explains Law on reopening to assess alleged Bogus Capital gains from penny stocks

Purviben Snehalbhai Panchhigar Vs ACIT (Gujarat High Court)

Purviben Snehalbhai Panchhigar Vs ACIT (Gujarat High Court) In the present case the Assessing Officer has heard the material on record which would prima facie suggest that the assessee had sold number of shares of a company which was found to be indulging in providing bogus claim of long term and short term capital gain. […]...

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In case of Encumbered Property, Stamp Duty value cannot be adopted as Sale Value

Sir Mohd. Yusuf Trust Vs ACIT (ITAT Mumbai)

Where property held by assessee was encumbered and, thus, she was not absolute owner of property, while computing capital gain arising from transfer of such a property, market value of property as taken for purpose of payment of stamp duty could not be adopted as sale consideration by applying provisions of section 50C....

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