The question then, would be; on facts what is discernible? As noticed above, every loan granted to a subsidiary company was preceded by the receipt of money by the assessee as loan from other entities. Undisputedly, even going by the assessee’s contention that the loans to subsidiary companies were from its internal resources; if such interest-free loans were not made, then at least to that extent the assessee need not have borrowed from other entities.
If the assessee treats expenditure on acquisition of assets as application of income for charitable purposes under section 11(1)(a) and if the assessee claims depreciation on the value of such assets, then in order to reflect the true income to be available for application for charitable purposes, the assessee should write back in the accounts the depreciation amount to form part of the income to be accounted for application for charitable purposes.
Calcutta High Court in Exide Industries case (supra) held that leave encashment is neither a statutory liability nor a contingent liability and it is a provision to be made for the entitlement of an employee achieved in a particular financial year. Testing clause (f) with the objects sought to be achieved by the introduction of Section 43 B, it was held that the same could not have any nexus with the object sought to be achieved by the original enactment.
Section 158BD is only an enabling provision to assess any other assessee other than the searched assessee if in the course of search of another assessee evidence of undisclosed income is received in respect of the assessee who is not searched. However, the assessment pursuant to the enabling provision i.e. under section 158BD also is an assessment under section 158BC and the procedure contemplated is also one and the same. In fact, what section 158BD says is that when the evidence collected in search of an assessee revealed undisclosed income of another assessee, who is not searched, the material or evidence so received can be the basis for making assessment under section 158BC of the assessee who is not searched.
CIT v. Khyber Foods The only question raised is whether the Tribunal was justified in holding that the assessments were invalid for the reason that search warrant issued in Form 45 was invalid. The contention of Senior counsel for the Revenue is that assessee never had a case on the validity of assessments except at the Tribunal stage when the assessee raised additional grounds in second appeals contending that warrants issued in the name of group concerns is invalid.
Calcutta High Court decision in Exide Industries case (supra). The Calcutta High Court held that leave encashment is neither a statutory liability nor a contingent liability and it is a provision to be made for the entitlement of an employee achieved in a particular financial year. Testing clause (f) with the objects sought to be achieved by the introduction of Section 43 B, it was held that the same could not have any nexus with the object sought to be achieved by the original enactment. Section 43 B, it was held, was originally inserted to plug evasion of statutory liabilities and the introduction of clause (f) was found to be inconsistent with the said object.
High Court Show Anguish Over step taken by Central Government to take steps to prevent generation and circulation of black money. The approach of the first appellate authority as well as the Tribunal was absolutely contrary to the scheme of block assessment under Chapter XIVB which can be made based on convincing evidence recovered in the course of search as provided under section 158BB. The assumption by the Commissioner (Appeals) as well as by the Tribunal that without the confirmation statement by the assessees undisclosed income cannot be assessed based on evidence gathered on search is wholly unrealistic and contrary to statutory scheme for assessment of undisclosed income under Chapter XIVB of the Act.
Learned Central Government Standing Counsel submitted that the award so far as the upholding the claims under claim Nos.8 to 75 are not seriously opposed and it need not be set aside, urging that the challenge to the award on the ground it is opposed to public policy is against the awarding of claims under 1 to 7, we are not impressed by that submission. When the award is found to be void as opposed to public policy no question of segregation of any part of the award would emerge for consideration
Learned Senior Standing Counsel for the Revenue has also made reference to the explanation to Section 37(1) of the Act and also to the scope of the proviso inserted to Section 69C of the Act by the Finance (No.2) Act, 1998 with effect from 01/04/1999. Learned counsel for the assessee contended that film production is not an illegal business and therefore payments made though without accounting cannot be said to be illegal payments attracting explanation to Section 37(1) of the Act.
Issue: Whether the explanation introduced to section 65(19)(ii) read with section 65(105)(zzb) of the Finance Act 1994 providing for levy of tax on service rendered in relation to lotteries promoted or marketed by the clients is unconstitutional as claimed by the petitioners/assesee. Held: After hearing the arguments of counsel for the petitioners and the Standing Counsel and on going through the later judgment rendered by the Chief Justice of the Sikkim High Court in Writ Petition(C) No.21/2009, we are unable to accept the challenge against the constitutional validity of the amendment.
