The main contention of the Income Tax Department is that the Scheme is floated with the sole object to avoid tax liability. Except the Income Tax Department no objections were raised by anyone against sanctioning the Scheme.
In the present case, we notice that in two out of four reasons recorded by the Assessing Officer for reopening the assessment, he stated that he need to verify the claims. In the second ground, he had recorded that admissibility of the bad debts written off required to be verified. In the fourth ground also, he had recorded that admissibility of royalty claim was required to be verified.
Assessee put forth his claim for exemption under section 10(23G) of the Act with respect to three different incomes, namely, (1) interest from SSNNL bonds, (2) interest from GIPCL bonds, and (3) capital gain from sale of shares by GPEC. Such claim was supported by the notes forming part of the return of income. It is not as if the Assessing Officer did not notice these claims.
In the present case, it is not even the case of the Revenue that shares were sold at a price lower than the market rate. If that be so, the question of inflating the loss by transferring the shares to group company would not arise. Under ordinary circumstances, it is always open to the assessee in his own wisdom to either hold on to certain bunch of shares or to sell the same to avoid further loss,
Tribunal were correct in taking the view that the refund was liable to be paid to the present respondents as service tax was not passed on to the buyers/customers and there was no unjust enrichment.
The Tribunal was justified in recording the aforesaid findings. In the facts of the case, it was not possible to ascribe any wilful suppression or mis-statement on the part of the assessee for not paying excise duty because during the period in question, various decisions of the Tribunal were to the effect that the activity of cutting, bending, bunching of plates or channels in which the assessee was engaged, did not amount to manufacturing activity. In Continental Foundation Jt. Venture v. CCE 2007 (216) ELT 177 (SC), Apex Court observed that when there was bona fide doubt as to non-excisability of the goods due to divergent views of the Hon’ble Supreme Court, the extended period of 5 years cannot be invoked. Mere failure or negligence in not taking license or not paying duty, is not sufficient for invoking extended period.
Sub-section (2) of Section 194C under ordinary circumstances does not cover an individual or Hindu Undivided family for the liability of deducting tax at source on the payments credited or made to the sub-contractor. However, proviso brings such individual or HUF within the fold of sub-section (2) if in the financial year immediately preceding the financial year during which such sum is credited or paid, such individual or HUF was covered by clause (a) or clause (b) of Section 44AB.
[a] The first test is whether the initial acquisition of the subject matter of transaction was with the intention of dealing in the item, or with a view to finding an investment. If the transaction, since the inception, appears to be impressed with the character of a commercial transaction entered into with a view to earn profit, it would furnish a valuable guideline.
The Tribunal while examining this issue went purely by the facts of the case and held that the difficulties in non-production of the documents as was required under the statute was on account of shifting of branch of the bank shortly before the date of the survey and afterwards within a period of two weeks they were furnished before the Assessing Officer. Since, these documents at the time of survey were not presented, it was inferred that they were collected subsequently in post survey period.
Land in question was declared surplus land under the Urban Land [Ceiling & Regulation] Act, 1976 which was having depressing effect on the value of the asset, the valuation had to be made on the basis of assumption that the purchaser would be able to enjoy the property as the holder, but with restrictions and prohibitions contained in the ULC Act and in such case value of the property or land would be reduced.
