As far as the provisions of the Act is concerned, now it has been streamlined that deemed dividend includes any payment by a company, not being a company in which the public are substantially interested, of any sum by way of advance or loan to a shareholder being a person who is the beneficial owner of shares holding not less than 10% of the voting power.
There cannot be any dispute that an assessee who is having losses cannot be compelled to pay the income-tax, as the Income-tax Act does not provide for such a situation, exception being the MAT provisions in the case of companies. What is required to be seen as per the circular issued by CBDT and which was approved by Supreme Court in Hindustan Coca Cola Beverage (P.) Ltd. v. CIT [2007] 293 ITR 226, is that ‘Taxes due’ have been paid by the deductee-assessee.
The first issue before us is whether the assessee is a developer and builder and, thus, entitled to deduction u/s. 80IB(10) qua the Sadguru Krupa Project, or only a Contractor and, thus, not so entitled. No argument, much less materials, has been advanced or adduced before us
The finding of the AO is that expenditure incurred by the head office will have to be allocated to the Indian offices. There has been no allocation made by the assessee. The income is being offered for tax on cost plus basis, therefore, the general and administrative expenditure incurred by the head office for running India offices has to be considered for working out the cost base.
Last proviso to section 54F clearly mentions that when amounts deposited under Capital Gains Account Scheme were not utilised wholly or partly for the purchase or construction within the period specified, then such amount would be charged as income of the previous year in which the period of three years, starting from the date of the transfer of the asset expired.
It cannot be said that Hindu is a separate community or a separate religion. Technically Hindu is neither a religion nor a community. Therefore, expenses incurred for worshipping of Lord Shiva, , Hanuman, Goddess Durga and for maintenance of temple cannot be regarded to be for religious purpose.
In the instant case of the assessee, the legal position is clear in as much as not having made the application under section 197 r.w.s. 195 of the Act to the Assessing Officer for lower or no deduction of tax, he was statutorily duty bound to have deducted tax at the specified rate on the ‘sum’ i.e. the sale consideration, before making payment to the seller who was an NRI.
On perusal of records, it was found that the assessee has filed detailed objections on selection of two comparables. But the D.R.P. has not made any reference in the impugned order about the objections of the assessee. Thus, the order of the D.R.P. cannot be termed as a speaking order. The said order deserves to be set aside to file of DRP for fresh adjudication.
Assessee spent considerable amount on advertisement of the institution which never existed and further, prospectus of the assessee trust has devoted substantially on carrying out the business activities of group concern showing logo of milk product. These factors were sufficient to hold that the ld. CIT rightly rejected both the applications of the assessee, particularly when no educational or charitable activities have been actually carried out and the assessee in initial stage,
Where the assessee has written off the value of assets in the books of assessee as obsolete, can it still be include the value of said machinery in the block of assets and claim depreciation thereon. In the decision of the Hon’ble Delhi High Court in the case of M/s Bharat Aluminium Co., Ltd., the Court held that in order to be entitled to claim depreciation asset has to be owned by the assessee and it has to be used for the purpose of business or profession, but the expression used for the purpose of business, would apply for block of assets and not any specific building, machinery, plant or furniture in the said block of assets, as the individual assets loose identity after becoming inseparable part of block of assets.
