Issue – Assessee in this appeal had sold a residential house at Film Nagar, Hyderabad, during the relevant previous year, for a sum of Rs. 6,50,00,000/-. After deducting indexed cost of acquisition, the long term capital gain came to Rs. 5,98,25,430/-.
If the assessee is able to keep the six months’ limit from the date of transfer of capital asset, but, still able to place investment of Rs. 50 lakhs each in two different financial years, we cannot say that the restrictive proviso will limit the claim to Rs. 50 lakhs only.
In the return of income, the assessee had claimed deduction under section 54F of the Act. During the course of assessment, the assessee disclosed that apart from property purchased at Kodaikanal for Rs. 1,14,88,000/-
The assessee before execution of the sale deed purchased the properties vide document No. 8547/2008 on 18.09.2008 for Rs. 47,53,223/-, document No. 8743/2008 on 04.10.2008 for Rs. 51,47,014/- and document No. 8295/2008 on 24.09.2008 for Rs. 28,68,302/-
In the instant case, the contention of the A.R of the assessee is that the impugned order passed u/s 143(3) by the Assessing Officer is not an order which is passed in pursuance of the directions of the DRP. However, if the above contention of the assessee is taken as correct then it implies that the assessee is not entitled to file directly appeal before the Tribunal in pursuance to such an order of the Assessing Officer passed u/s 143(3) of the Act. We find that the DRP has categorically stated that it has no jurisdiction to pass any direction in pursuance to the belated objections filed by the assessee against the draft order of the Assessing Officer and in fact, the Panel gave no direction in respect of objections of the assessee.
The machinery which was purchased by the assessee in the course of expansion of new Project was installed in the year 1996-97 relevant to the Asst. Year 1997-98. There is nothing on record to suggest that the assessee had put the machinery to use during the Asst. Year 1998-99. It appears that the assessee had claimed 100% depreciation as the project was completely abandoned later in the year 1999. Since the machinery was never put to use by the assessee no depreciation is allowable for the Asst. Year 1998-99.
In the instant case, the assessee although an extended arm of State Government formed as a society to carry out charitable activities in the nature of ‘general public utility’ is in fact providing assistance to industrial houses and entrepreneurs for setting up of industry in the State of Tamil Nadu. The assessee facilitates in providing licence, approval and permission from various Government agencies for setting up of industry in the State, for which it is charging fee. The fee charged by the assessee is not remitted to the Government treasury or exchequer. After insertion of proviso to section 2(15) of the Act, the assessee has lost its character of charitable organization. The assessee is a service provider.
The assessee is a cellular company selling SIM cards and recharge coupons. The assessee has deducted TDS on both the sale, i.e. SIM cards as well as recharge coupons upto the financial year 2007-08. Thereafter TDS was deducted only on SIM cards and no TDS was deducted insofar as the recharge coupons are concerned. It was explained before the Assessing Officer that because of change of policy decision TDS was not deducted. The amount paid on selling of recharge coupons was not commission but only a discount.
The ground raised by the Revenue relates to exclusion of foreign currency expenses not related to onsite software development from the export turnover for the purpose of computing deduction u/s 10A and 80HHE of the Act. The case of the assessee is that foreign expenditure which has been incurred on on-site software development activity should not be excluded from the export turnover.
We find that we are bound to follow the judgment of the Income-tax Appellate Tribunal, Chennai ‘B’ Special Bench rendered in the assessee’s own case for the assessment years 1998-99 to 2002-03. In the said decision rendered in the case of Mahindra Holidays & Resorts (India) Ltd. (supra), the Special Bench has held that 40 percent of deferment of membership fee resorted to by the assessee is justified. The said decision of the Special Bench is rendered in the assessee’s own case in exactly similar circumstances. Therefore, the rule of precedence demands that the decision of the Special Bench must prevail.
