In absence of fresh material indicating escaped income, the AO cannot assume jurisdiction to reopen already concluded assessment. It was further held that since there was no whisper in reasons recorded, of any tangible material which came to possession of AO subsequent to issue of intimation, therefore, it was an arbitrary exercise of power conferred u/s 147.
In a major relief to the Ernst & Young Pvt Ltd (EY), the Kolkata bench of the ITAT confirmed the original assessment order passed by the Assessing Officer allowing deduction under sections 10A and 10AA of the Income Tax Act to the Company without set off of loss of taxable unit.
There is nothing brought on record to show that the activities of the assessee are driven by profit motive. In these circumstances we are of the view that the conditions for grant of registration u/s 12AA of the Act are duly satisfied as the activities of the assessee are genuine and its objects are also charitable.
No technical services were involved in payment of carriage charges made by the assessee for broadcasting of the programmes produced by the assessee. The assessee produced various types of programmes/ serials and news and these were telecasted/ broadcasted through Multi System Operators. Payments in this regard were made as carriage charges for which payment of tax was deductible under section 194C of the Income Tax Act.
It has been held that ‘even though the expenditure is not admissible for the computation of the total income either as a bad debt or as an expenditure wholly incurred for the purpose of business, still, it can be allowed as an expenditure as a trading loss if it arises directly from carrying on the business and is incidental to the business.
Now the issue before us arises so as to whether the labourers are the employees of assessee or they are working in contractual capacity attracting the provisions of TDS.
CIT (Appeals) was not correct in law that the assessee will be liable to deduct the TDS if the amount of a single contract exceeds Rs. 20,000/-. The contract has to be looked into party-wise not on the basis of the individual GR. In our opinion, all the payments made to a truck owner throughout the year are to be aggregated to ascertain the applicability of the TDS provision
The labour sardars are employed/deployed by the labour union to collect the money in bulk and distribute the same amongst the labourers, who are ultimate beneficiaries and not the labour sardars i.e in question. These labour sardars are remunerated by the union only for the job done. The collected money distributed amongst the labours/ labourers by the labour sardars on behalf of assessee and as such deducting of TDS from the said payment amount does not arise at all.
Expense was classified under the head major repair and maintenance on the ground that the large expense was spent on repair and maintenance but the fact is that there was no enhancement in the capacity of the plant and machinery as well as no increase in the efficiency.
Assessing Officer to compute the disallowance as per Rule 8D by taking into consideration only those shares, which have yielded dividend income in the year under consideration.
