The ITAT Delhi bench in the above cited case held that in case of completed assessment if notice u/s 153A is issued then addition can be made only on the basis of incriminating material found during the course of search.
The Hon’ble Allahabad High Court after examining the said objects in light of proviso to Sec 2(15) has held that development authorities will not be hit by the proviso to Sec 2 (15). The reliance on the judgments by the Ld. DR are on different footing altogether. The reliance of the Board Circular is also not applicable in the present case as there was no change in the charitable purpose while doing the activity of development by the assessee.
ITAT Kolkata held that VAT and CST even if not included in value of closing stock do not result in undervaluation of closing stock because of its corresponding non-inclusion in Opening Stock , Purchases and Sales.
The case of assessee was reopened and the assessment under section 144 read with section 147 of the IT Act, 1961. While framing the assessment, the AO restricted the deduction claimed u/s 80P(2)(c)(i) of the Act and also confirmed the disallowance u/s 40(a)(ia) consequent to deposit
ITAT held that it is generally accepted prudent practice that the closing stock to be valued at lower of cost or net realizable value. Further, net realizable value means the value which the goods would fetch at the time of actual sale.
AO is bound to furnish the reasons recorded for initiation of proceedings under section 147 of the Act within a reasonable period of time so that the assessee could file its objections thereto and the AO was to dispose of the same by passing a speaking order thereon, which the AO has not done.
AO/CIT(A) have made the addition under section 68 of the Act merely on presumptions, suspicions and surmises in respect of penny stocks; disregarding the direct evidences placed on record and furnished by the assessee in the form of brokers contract notes for purchases and sales of the ‘said shares’
Since redemption of preference shares does not result in reduction of share capital as per Sec 80 of the Companies Act,1956 , the redemption value cannot be taxed as deemed dividend as the distribution of profits if at all there may be is not resulting in reduction of capital.
Just because the assessee has not filed its income tax returns in earlier years, it can not be said that the activities of the assessee are not genuine. It has been held that non-filing of return cannot be one of the reasons for denying registration under section 12A of the Act.
ITAT held that simultaneous trading of shares in cash segment and arbitrage in derivative segment by assessee company cannot be splitted into speculative and non-speculative transactions . So, as soon as it is found that assessee is trading in shares , the entire trading activity to be treated as speculative business as per explanation to Sec 73 which clearly state that if any part of assessee’s business is trading in shares then the same trading to be treated as speculative business.
