Statute consisting of Act and Rules speak of filing of return before due date and contents of that must be furnished in that return. The format has been prescribed by the Rules and also the contents have been prescribed by the Rules. Filing of the return also has been prescribed by the Act. Nowhere in the Act or Rules, there is a mandatory provision that the return must be filed only electronically.
It is now a settled proposition of law that the Appellate Tribunal under section 254(1) of the Act, had no power to take back the benefit conferred by the Assessing Officer or enhance the assessment. Once the matter has been restored by the Tribunal, the income cannot be enhanced from what was determined at the time of original assessment proceedings, which was the subject matter of dispute before the Tribunal. This proposition of law has been upheld by the Hon’ble Supreme Court in Hukumchand Mills Ltd. v/s CIT, [1966] 62 ITR 232 (SC), and had now been reiterated in Mcorp Global (P) Ltd. (supra). Therefore, in view of this proposition of law, the enhancement of assessment by making 100% disallowance in respect of free food allowance cannot be sustained and the same is restricted to 50%, as was made by the Assessing Officer in the original round of proceedings. Consequently, this ground is allowed to this extent only.
A look into the original assessment order clearly show that but for the deduction allowed to the assessee as claimed by it in its return, there was no discussion as to how Section 36(1)(viia) was applied and whether the limits were corrected worked out. Admittedly, no question was asked to the assessee during the course of assessment proceedings also with regard to the claim made by it under Section 36(1)(viia),
Even if the assessee as well as the authorities below agree that the internal comparables are sufficient for the TP study in the present case, that does not justify the legal compulsion of examining the external comparables as well. An agreement, arrived at on the basis of incorrect premises between the contending parties, does not determine the legality or otherwise of the course of action opted by them. The course of action must be determined strictly on the basis of the words of the statute and not by the consensus of the contending parties.
By looking at the aims and objectives of the assessee’s-society it was apparent that one of the objectives was construction of suitable memorials in the memory of war heroes but the other objects to be taken up the assessee-society by way of setting up educational institutions, arranging seminars, holding meetings/conferences and to organize lecture exhibition etc.,
No material whatsoever was brought on record by the Assessing Officer to the effect that the payment of Rs. 1,20,00,000 was for the assessee not to engage in any business. Even so, the Assessing Officer opined that the compensation of Rs.1,20,00,000 was not a capital receipt liable to capital gains, but was a business receipt falling under “business income” and that rather, the “compensation” was for not carrying out any activity in relation to the business of the Company, which was taxable under section 28(va).
Admittedly, vehicles have been taken under a finance lease arrangement and not under operational lease, Article 2.2 of the agreement entered into by assessee with LPIN provides for arrangement for the registration & insurance of the vehicles and inter alia, stipulates that vehicles shall be insured and registered in the name of the client, i.e., the assessee as required under the Motor Vehicles Act, 1988.
Thus, the assessee had earned the benefit as soon as he had purchased the new plant and machinery in full but it is restricted to 50% in that particular year on account of period of usages. Such restrictions cannot divest the statutory right. Law does not prohibit that balance 50% will not be allowed in succeeding year.
The reliance placed on Hon’ble Supreme Court judgment in the case of Empire Jute Co. Ltd. (supra) is well placed as the expenditure incurred by the assessee has direct nexus with its income generating apparatus. Respectfully following various judgments mentioned and relied on by CIT(A) we see no infirmity in his order, which is upheld. The assessee’s cross objection being only in support of CIT(A) order, is rendered infructuous.
A glance at the provisions of section 271(1)(c) of the Income-tax Act, 1961, suggests that in order to be covered by it, there has to be concealment of the particulars of the income of the assessee. Secondly, the assessee must have furnished inaccurate particulars of his income. The meaning of the word “particulars” used in section 271(1)(c) would embrace the details of the claim made.
