Bidhi Chand Singhal vs. ITO (ITAT Delhi)- In our opinion, in the absence of definition of “eco-tourism” the hotel as added into the Item No.15 of Part C is to be construed to be hotel situated in the State of Himachal Pradesh or the State of Uttaranchal having a valid licence on the basis of No Objection from Pollution Department which can be treated to be a hotel eligible for deduction u/s 80IC as per provisions of Section 80IC. Therefore, we allow the claim of deduction u/s 80-IC to the assessee and the appeal of the assessee is allowed.
Nagindas P. Sheth (HUF) vs. ACIT (ITAT Mumbai) -Merely because assessee transacted in 158 shares that should not be taken as a sole criterion to come to the conclusion that assessee is a trader in shares. It is not in dispute that in the books of accounts assessee has declared the shares as an investment and the finding of the learned CIT (A) that only own funds were utilised for purchase of shares was not contradicted by the learned DR. It was also highlighted by the learned CIT(A) that assessee had not indulged in any squaring-up of the transactions on the same day. On a conspectus of the matter, we are of the view that the transactions of purchase and sale of shares, in the instant case, deserves to be considered as investment and profit thereon has to be assessed to tax under the head ‘capital gains’.
The Mumbai bench of the Income-tax Appellate Tribunal, (“Tribunal”) in a ruling’ in the case of Citicorp Banking Corporation, Baharain v. Addl. Director of Income Tax (I.T.)-Range 1-[2011-T11-40-1TAT-MUM-INTL] , held that losses arising on cancellation of foreign exchange forward contracts entered into by the assessee for protecting it against the risk of currency fluctuation would be characterised as capital loss and the said loss can be set-off against other capital gains under the provisions of the Income-tax Act, 1961 (the “Act”). Further, the Tribunal also held that section 115AD provides for tax rates on income from securities or capital gains and it has nothing to do with determination of the nature of gain or loss i.e. capital or revenue.
Section 2(47) of Income-tax Act defines transfer, which, inter alia includes sale, exchange, relinquishment of the asset or extinguishment of any rights therein. In the case of Phulchand Sons Investments Pvt. Ltd. v. ACIT the Mumbai Bench of Income Tax Appellate Tribunal observed that the assessee had undertaken a loan transaction and not sale of shares during the subject assessment year. The revenue authorities were unable to bring any evidence on record to establish that the assessee had engaged in a sale transaction and not a loan transaction. Accordingly, the Tribunal held that lending of shares is not a ‘transfer’ within the meaning of section 2(47) of the Act, and hence, is not taxable.
Synergy Entrepreneur Solutions Pvt Ltd vs. DCIT (ITAT Mumbai)- The reason given for the revision in the s. 263 order (that the AO has not verified the issue) is different from the reason set out in the show-cause notice (that speculation loss cannot be set-off against other income). If a ground of revision is not mentioned in the show-cause notice, it cannot be made the basis of the order for the reason that the assessee would have had no opportunity to meet the point (Maxpack Investments 13 SOT 67 (Del), G.K. Kabra 211 ITR 336 (AP) & Jagadhri Electric Supply 140 ITR 490 (P&H) followed);
CIT Vs Sanjay Chhabra ( Chandigarh High Court)- The sole point for consideration in this appeal is that once the Revenue had come to the conclusion that the assessee had made sales of apples amounting to Rs. 5,75,654/- to one Jagdish Chawla, whether it was the entire amount, or the 5% profit thereof, being commission on such sale, that was to be added to the income of the assessee.
Singareni Collieries Company Ltd Vs ACIT (ITAT Hyderabad) – Whether book profits is to be computed with reference to each assessment year – Whether profits earned during the period of sickness and available for setting off under normal provisions of Income Tax are to be excluded from the ambit of book profit of non-sick years. – Assessee’s appeal dismissed.
“Whether in the facts and circumstances of the case where the delay in the disposal of the relevant appeals is not attributable to the assessee, the Tribunal can extend the stay already granted beyond the period of 365 days even after 01.1 0.2008 or it has no power to grant/extend such stay as a result of amendment made by the Finance Act 2008 by substituting third proviso to Section 254(2A) w.e.f. 01.10.2008?”
Recently, the Mumbai bench of the Income-tax Appellate Tribunal (the Tribunal) in the case of ITO v. Galaxy Saws P. Ltd. (ITA No.3747/M/2010) (Judgement Date: 11 March 2011, Assessment Year: 2005-06) held that revaluation reserve not routed through Profit & Loss Account but directly transferred to balance sheet could not be added to net profit while computing the book profit for the purpose of Minimum Alternate Tax (MAT). Further, the Tribunal reiterated that principle that once the accounts have been prepared as per the provisions Schedule VI of the Companies Act and adopted at the Annual General Meeting (AGM) of the company, the net profit disclosed in such accounts cannot be tinkered with by the Assessing Officer (AO) while computing the book profit.
The Delhi bench of the Income-tax Appellate Tribunal [“The Tribunal”] recently pronounced its ruling in the case of Clear Plus India Private Limited v. DCIT [ITA NO. 3944/DEL/2010], wherein it upheld the transfer pricing methodology adopted by the taxpayer to benchmark its export sale by the application of internal comparable uncontrolled price [“CUP”] method, adopting its associated enterprise [“AE”] as the tested party. The revenue’s contention to use Transactional Net Margin Method [“TNMM”] was rejected as in view of the Tribunal minor aberrations in the application of CUP method do not warrant its abandonment.
