Recording of reasons before initiation of reassessment proceedings & communication thereof to assessee is sine qua non that goes to root of matter
Held that factors like high status, family tradition, deduction on account of purity and deduction towards Streedhan should be considered before making addition on account of unexplained investment. Accordingly, addition deleted.
Once it is established that there was nexus between the expenditure and purchase of the business (which need not necessarily be the business of the assessee itself) the Revenue could not justifiably claim to put itself in the arm-chair of the businessman or in the position of the board of directors and assume the role to decide how much was reasonable expenditure having regard to the circumstances of the case.
Section 263 cannot be invoked to correct each and every type of mistake or error committed by the AO; it is only when an order is erroneous as also prejudicial to Revenue’s interest, that the provision will be attracted.
Held that fees like entrance fees as well as life membership are part of the corpus fund and accordingly are in the nature of capital receipt.
Held that revisional jurisdiction u/s. 263 of PCIT cannot be invoked for initiation of penalty proceedings without holding that the assessment order passed by the AO as erroneous and prejudicial to the interest of revenue.
Held that assessee has no interest in the ownership of the asset but he is in possession of the asset for conducting its business, the litigation expenditure incurred is only to protect his business and, therefore, the same is revenue expenditure.
Allen Career Institute Vs JCIT (ITAT Jaipur) Disallowance of Rs.2,01,515/- on account of New Electricity Connection charges. In Ground of Appeal disallowance of Rs. 2,01,515/- made relating to the claim on account of electric connection charges, is agitated. The AO noted that the assessee had claimed expenditure of Rs.2,37,076/- for new electricity connection charges. When […]
Where a number of persons combine together and contribute to a common fund for the financing of some venture or object and in this respect have no dealings or relations with any outside body, then any surplus returned to those persons cannot be regarded in any sense as profit.
Held that the department has failed to issue notice, failed to report the reasons for reopening the case and also failed to take the approval of the appropriate authority before as initiation of proceedings u/s 147 of the I.T. Act. Appeal allowed on technical ground.
