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Karnataka High Court

Duty / Tax wrongly paid at insistence of Department is eligible as CENVAT credit

April 1, 2011 1594 Views 0 comment Print

Though the excise duty was not paid at the time of clearance strictly in accordance with rules governing the same, the assessee cannot be found fault with because according to the assessee the said goods were not excisable to tax. Now the said stand has been vindicated by the order of the Appellate Authority, which has become final.

Lifting of Corporate Veil to tax sale of Foreign Company shares by one Non-Resident to another Non-Resident if Foreign Co holds shares in Indian Company

March 24, 2011 4833 Views 0 comment Print

Richter Holding Ltd v. ADIT – The Vodafone controversy continues – To determine taxability of acquisition of shares of a non-resident company holding majority shares in an Indian company by another non-resident, it may be necessary for the fact finding authority to lift the corporate veil to look into the real nature of transaction to ascertain virtual facts.

Assessee can claim deduction for provision for warranty if it was not a contingent liability

March 23, 2011 1105 Views 0 comment Print

In so far as claiming the amount set out towards warranty is concerned, the apex court in the case of Rotark Controls India P. Ltd. v. CIT [2009] 314 ITR 62 has held that the principle is that the historical trend indicates that a large number of sophisticated goods were being manufactured in the past and the facts show that defects existed in some of the items manufactured and sold, then provision made for warranty in respect of such sophisticated goods would be entitled to deduction from the gross receipts under section 37.

Employee opting for voluntary retirement scheme has no right to withdraw

March 18, 2011 1919 Views 0 comment Print

Petitioner was an employee in the 1st respondent – Organization M/s. HMT Ltd. Petitioner availed of a voluntary retirement scheme as on 31.3.2003 that was mooted by the employer and as a result he received an amount of Rs. 6,01,270/-. The employer at the time of paying this amount deducted a sum of Rs. 29,331/- at source under the provisions of Section 192 of the Act and an acknowledgment in Form 16-A was also issued to the petitioner evidencing the deduction of this amount from the amount paid to him and remitted the same to the credit of the Income Tax Department.

Whether AO can deny exemption u/s 80IB(10) without commenting on assessee’s claim

March 15, 2011 1196 Views 0 comment Print

M/s Varun Developers Vs CIT, Bangalore (Karnataka High Court)- In view of the submission made to consider whether the calculations have to be made on completion of the project after registering the plots in favour of the intended purchasers or customers, who had invested the amount from time to time, or as and when the amount is paid and accrued to the benefit of the petitioner for each assessment years and, also to consider the deductions available as per Section. 801B(10) of the Act and to pass appropriate orders in accordance with law, the matter is remanded to the Assessing Officer by quashing the impugned orders passed by the Assessing Officer as well as by the Revisional Authority. All the contentions are left open to be urged, Petitions are accordingly allowed.

MAT credit to be first adjusted and then TDS and prepaid taxes should be set off against the total tax liability and the assessee is not entitled to interest under s 244A against the MAT credit

February 14, 2011 15291 Views 0 comment Print

CIT Vs M/s Sami Labs Limited – Karnatka High Court (Dated: February 14, 2011)- Income tax – Section 115JAA, 263, 244A – Whether MAT credit is to be first adjusted and then TDS and pre paid taxed should be set off against the total tax liability – Whether assessee is entitled to interest u/s 244A against the MAT credit. – Revenue’s appeal dismissed.

Declaration U/s. 158A not provide any immunity from payment of tax due

January 25, 2011 2994 Views 0 comment Print

It is to be noted here that the claim made by the assessee under section 158-A will not however preclude the Assessing Officer from making an order disposing of the relevant case without awaiting the final decision on the question of law in other case. When the decision on the question of law becomes final, it shall be applied to the relevant case and the Assessing Officer and the appellate authority shall amend the order earlier passed, if necessary in view of the final decision on the question of law in the other case.

S. 54 benefit cannot be denied merely because assessee purchases 2 house units

January 5, 2011 2919 Views 0 comment Print

Two flats purchased by the assessee were situated side by side. Builder also stated that he had effected modifications to the flats to make them one unit by opening the door in between the two apartments. The fact that the assessee could not have purchased both the flats in one single sale deed or could not have narrated the purchase of two premises as one unit in the sale deed could not make any difference.

Development of customized software is not works contract and hence not subject to levy of VAT under Karnataka Value Added Tax Act, 2003

December 15, 2010 4119 Views 0 comment Print

M/s Sasken Communication v. Joint Commissioner, Commercial Taxes & Ors (Karnataka High Court) The contract for development of software in question are not works contract but contract for service simplicitor and hence not liable to tax under the Karnataka Value Added Tax Act, 2003. The contract for development of software is not a composite contract consisting of a contract of service and contract for sale of goods. It is an indivisible contract of service only.

Section 194C of Income-tax Act does not stipulate existence of a written contract as a condition precedent for payment of TDS

July 19, 2010 2877 Views 0 comment Print

The contract may be in writing or it may be oral but the liability to pay tax arises when the recipient of the said amount receives payment in excess of Rs. 20,000.

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