Section 145

Taxability of Interest on Compensation or Enhanced Compensation

Income Tax - The statutory provisions for the income in the nature of ‘Interest received on compensation or on enhanced compensation’ were brought to Income Tax by the Finance Act’ 2009. When these provisions were introduced, the Memorandum explaining the provisions of the Finance Bill 2009 had this to say:...

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Section 145- Rejection of Books of Account

Income Tax - Problem Faced by Business man as well as Professional :- Stock register as well as details of closing stock in quantitive and rate wise is a major hurdle for both of them. In some business i.e. Labour intensive Work, wholesale and Retail of construction goods releted business, readymade garment business and some other business...

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Rejection of books of Accounts – Section 145(3) – Issues & Case Laws

Income Tax - Section 145 of the Income Tax Act 1961, lays down that income chargeable under the head “Profit and gains of business or profession” or “Income from other sources” shall, subject to the accounting standards notified by the Central Government in the Official Gazette, be computed in accordance with either cash or mercantile system o...

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S.145A Unutilized Cenvat credit does not constitute income irrespective of Method of Accounting followed

CIT Vs M/s. Diamond Dye Chem Ltd. (Bombay High Court) - S. 145A: Irrespective of the method of accounting followed, the unutilized Cenvat credit does not constitute income and cannot be directly added to the closing stock. The assessee is entitled to follow the exclusive method and value the closing stock by excluding the modvat credit ...

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S.145A No Addition for stock valuation if exclusive method followed

DCIT Vs M/s Stone India Limited (ITAT Kolkata) - ITAT Kolkata held that VAT and CST even if not included in value of closing stock do not result in undervaluation of closing stock because of its corresponding non-inclusion in Opening Stock , Purchases and Sales....

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Exclusive Method’ of accounting is valid in absence of any notified standard by Department

A.C.I.T. Vs Kiran Industries Pvt Ltd. (ITAT Ahmedabad) - In A.C.I.T. vs. Kiran Industries Pvt Ltd, the Ahmedabad Tribunal following its co-ordinate bench decision and relying upon the decision of Hon’ble High Court (T&AP) held that excise duty component need not to be included in valuation of inventory if the assessee is following exclusive method of ac...

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Book of Contractor cannot be rejected for Mere low Profit or Non Maintenance of Stock Register

Mehta Construction Co. Vs ITO (ITAT Delhi) - Mehta Construction Co. Vs ITO (ITAT Delhi) Assessing Officer was driven to reject the book results, mainly on the ground that the profit returned on the contract receipt is very low and no stock register was maintained....

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AO can make adjustment to profit if books are not in accordance with established accounting principles

Padinjarekara Agencies Pvt. Ltd Vs ACIT (ITAT Cochin) - The assessee had contended that the Assessing officer was not entitled to make adjustments to book profit shown in the audited The question that had arisen was whether the Assessing officer was entitled to disturb the net profit shown by the assessee in the profit and loss account prepared as per th...

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Recent Posts in "Section 145"

S.145A Unutilized Cenvat credit does not constitute income irrespective of Method of Accounting followed

CIT Vs M/s. Diamond Dye Chem Ltd. (Bombay High Court)

S. 145A: Irrespective of the method of accounting followed, the unutilized Cenvat credit does not constitute income and cannot be directly added to the closing stock. The assessee is entitled to follow the exclusive method and value the closing stock by excluding the modvat credit ...

Read More

Taxability of Interest on Compensation or Enhanced Compensation

The statutory provisions for the income in the nature of ‘Interest received on compensation or on enhanced compensation’ were brought to Income Tax by the Finance Act’ 2009. When these provisions were introduced, the Memorandum explaining the provisions of the Finance Bill 2009 had this to say:...

Read More
Posted Under: Income Tax |

S.145A No Addition for stock valuation if exclusive method followed

DCIT Vs M/s Stone India Limited (ITAT Kolkata)

ITAT Kolkata held that VAT and CST even if not included in value of closing stock do not result in undervaluation of closing stock because of its corresponding non-inclusion in Opening Stock , Purchases and Sales....

Read More

Exclusive Method’ of accounting is valid in absence of any notified standard by Department

A.C.I.T. Vs Kiran Industries Pvt Ltd. (ITAT Ahmedabad)

In A.C.I.T. vs. Kiran Industries Pvt Ltd, the Ahmedabad Tribunal following its co-ordinate bench decision and relying upon the decision of Hon’ble High Court (T&AP) held that excise duty component need not to be included in valuation of inventory if the assessee is following exclusive method of accounting....

Read More

Book of Contractor cannot be rejected for Mere low Profit or Non Maintenance of Stock Register

Mehta Construction Co. Vs ITO (ITAT Delhi)

Mehta Construction Co. Vs ITO (ITAT Delhi) Assessing Officer was driven to reject the book results, mainly on the ground that the profit returned on the contract receipt is very low and no stock register was maintained....

Read More

Section 145- Rejection of Books of Account

Problem Faced by Business man as well as Professional :- Stock register as well as details of closing stock in quantitive and rate wise is a major hurdle for both of them. In some business i.e. Labour intensive Work, wholesale and Retail of construction goods releted business, readymade garment business and some other business...

Read More
Posted Under: Income Tax |

AO can make adjustment to profit if books are not in accordance with established accounting principles

Padinjarekara Agencies Pvt. Ltd Vs ACIT (ITAT Cochin)

The assessee had contended that the Assessing officer was not entitled to make adjustments to book profit shown in the audited The question that had arisen was whether the Assessing officer was entitled to disturb the net profit shown by the assessee in the profit and loss account prepared as per the Companies Act, 1956....

Read More

Books of Accounts cannot be rejeced on mere fall in G.P Ratio

A.C.I.T. Circle- I Vs Smt. Meena Singh Shekhawat (ITAT Jodhpur)

We have found that the G.P. rate in this year has been on lower side. However, the decrease in G.P. rate stands explained by the undeniable reasons that there is heavy increase in purchase price, freight cost and export cost....

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Rejection of books of Accounts – Section 145(3) – Issues & Case Laws

Section 145 of the Income Tax Act 1961, lays down that income chargeable under the head “Profit and gains of business or profession” or “Income from other sources” shall, subject to the accounting standards notified by the Central Government in the Official Gazette, be computed in accordance with either cash or mercantile system o...

Read More
Posted Under: Income Tax |

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