Surplus funds not immediately required for day to day banking were kept in Bank deposits. The income earned there from thus would be income from banking business eligible for deduction u/s 80P(2)(a)(i).
This is not denied that the assessee is engaged in the business of providing credit facilities to its members. The credit facilities cannot be provided until and unless the assessee receives the deposits. It cannot always be provided out of its own capital. Receiving of the deposit is necessary and essential for advancing the money on credit and earning the interest income. The deposits may not have been derived from the income for providing the credit facilities to the members.
AO has, as highlighted by the FAA, not produced any evidence that assessee was purchasing and selling plots of land in subsequent and earlier assessment years. AO is entitled to draw inferences and conclusions during assessment proceedings. But, the conclusion which adversely affect the interests of a tax-payer should be based on facts and same should be confronted to the assessee for rebuattal. FAA has given a categorical finding of fact that such a exercise was not undertaken by the AO.
Income Tax is a code in itself and for levying taxes certain terms have been defined in a particular manner and they carry special meanings. Word ‘person’ is one among them. So, in our humble opinion, State Government is a person for purposes of collecting tax at sources as per the provisions of Sec 206C of the Act.
It cannot be said that Hindu is a separate community or a separate religion. Technically Hindu is neither a religion nor a community. Therefore, expenses incurred for worshipping of Lord Shiva, , Hanuman, Goddess Durga and for maintenance of temple cannot be regarded to be for religious purpose.
Mumbai Tribunal Ruling: Fees for Technical Services, even if rendered outside India, are taxable consequent to retrospective amendment in Section 9 by the Finance Act, 2010 (Ashapura Minichem Limited v. ADIT)(ITA No. 2508/M/2008)
Even without going to all the strict interpretation, even otherwise on receipt of advance as per the agreement, if the assessee deposited the amount as required us 54EC. he cannot be treated as a defaulter for the same.
Explanation to s. 37 (1) does not apply to “penalty” which is not of the nature of illegal / unlawful expenditure The assessee became liable to pay “penalty” for overloading wagons under the rules of the Railways. The question arose whether the said “penalty” was disallowable under the Explanation to s. 37 (1) which provides that
It is apparent from the perusal of section 80IB(10) that this section has been enacted with a view to provide incentive for businessmen to undertake construction of residential accommodation for smaller residential units and the deduction is intended to be restricted to the profit derived from the construction of smaller units and not from larger residential units.
48. Section 17(2)(ii) as it stood prior to amendment in 2007 did not contain any ‘deeming clause’ to deem rent paid less than 10% or 7.5% as a concession or that the employees is deemed to have received that concession. An employer may provide residential accommodation to his employees for several reasons. It is also possible that for making available staff quarters/colonies/ accommodations, State Governments
