In order to appreciate the controversy few facts may be noticed. The assessee-company is manufacturing colour picture tubes. In respect of the assessment year 2004-05 the assessee company incurred expenditure for the purpose of restructuring. The assessee-company had become a sick unit and in that regard a reference was made to BIFER for its rehabilitation
Accordingly, the right to subscribe for additional offer of shares/debentures comes into existence only when the Company decides to come out with the Rights Offer and it is only when that event takes place, that diminution in the value of the original shares held by the assessee takes place. One has to give weightage to the diminution in the value of the original shares which takes place when the Company decides to come out with the Rights Offer as held in Dhun Dadabhoy Kapadia 63 ITR 651 (SC).
The assessee, a NBFC, made a ‘Provision for NPA’ in terms of the RBI Directions 1998. It claimed a deduction for the said provision u/s 36 (1)(vii) on the ground that as it was debited to the P&L Account and reduced the profits, it was a ‘write off’. In the alternative, it was claimed that there was a diminution in the value of its assets
Whether the Department is entitled to treat the ‘Provision for NPA, which in terms of RBI Directions 1998 is debited to the P&L Account, as income under Section 2(24) of the Income Tax Act, 1961 , while computing the profits and gains of the business under Sections 28 to 43D of the IT Act
Whether the vehicles hired by the assessee in execution of the transport contract can be termed as a Sub-contract and consequently the assessee is liable to deduct tax from the payment made for such vehicles u/s 194C (2) of the Act the assessee is not liable to deduct tax at source, as per the provisions of section 194C(2), on the payments made to the lorry owners for lorry hire. Consequently, the provisions of section 40(a)(ia) shall not apply to such payments.
Assessees who fulfill all the conditions are entitled to registration cannot be faulted. The contention of the Revenue that the assessees are not registered as an institution and hence not entitled for registration is also without any merit, because, there is no requirement under the Act that an institution
We have heard the rival submission and perused the relevant material on record in the light of precedents relied upon. The factual position has been elaborately noted in the foregoing paragraphs. To sum-up the facts, it is noted that Shri Kulwant Singh Kohli was the original owner of the three shops which
After passing of order by Settlement Commission, no power vests in Assessing Authority or any other authority to issue notice in r/o period and income covered under order of Settlement Commission.
Unfortunately, for the appellant NBFCs. are not covered by Section 36(l)(viia) of the I.T Act and so much so, explanation to section 36(l)(vii) squarely applies or in other words, the appellant-N. B.F.Cs. are not entitled to deduction of any Provision created for bad and doubtful debts, no matter such provision
It shows that these assessees had really intended to comply with the notices and therefore it should not be inferred that there was a default which could invite penalty u/s 271(l)(b). The ITAT Delhi Bench-G in the case of Akhil Bhartiya Prathmik Shikshak Sangh Bhawan Trust vs. Assistant Director of Income-tax (2008) 115 TTJ (Delhi) 419
