Revenue challenged the order passed by ITAT which confirmed the order of CIT (A) that expenditure incurred i.e. payment of royalty for technical knowhow in terms of Technical Collaboration Agreement (TCA Agreement) is an allowable expenditure as no benefit was obtained by the Assessee for the period beyond the relevant assessment years.
The Hon’ble Delhi High Court in the case of HCL Technologies Ltd. held that completed cannot be reopened after the expiry of four years from the end of relevant assessment year unless the income escaped from tax is attributable to assessee’s failure to disclose full & true disclosure of the facts.
In the case of Commissioner of Income Tax vs. DLF Commercial Project Corporation Delhi High Court held that Advance received cannot be treated as income of the assessee and TDS is not deductible on reimbursement of Expenses since it is not an income.
Delhi High Court in the case of CIT vs. DLF Commercial Project Corp held that There is no obligation to deduct TDS on amounts paid as reimbursement of expenses because it do not have the character of income.
The present case is related to search & seizure action carried out in case of Sh. S.K. Gupta (‘third party’) in respect of companies and other business entities which were controlled by him or owned by him or different individuals connected with him.
However, where the fundamental transaction is shown to be a sham transaction, the same cannot necessarily be accepted as genuine merely because a broker’s confirmation and invoices have been produced. Given the facts of this case, the decisions referred to by CIT(A)
Mistake apparent on the record u/s 154 must be an obvious and patent mistake and not something which can be established by a long drawn process of reasoning on points on which there may be conceivably two opinions.
The petitioner by letter dated 17th November, 2011 had disclosed a foreign bank account which existed with the HSBC Private Bank, Geneva, Switzerland to the Director of Income Tax (Investigation-II). The peak amount lying in the said account during the year ending 31st March, 2007 was around US$ 1.3 million.
Whether the assessee company charged a higher premium or not, should not have been the subject matter of the enquiry in the first instance Instead, the issue was whether the amount invested by the share applicants were from legitimate sources.
The Hon’ble Delhi High Court in the case of CIT vs. Om Prakash Khaitan held that In the absence of change in system of accounting consistently followed by the assessee and accepted by the department, the department cannot take different stand for the subsequent years.
