CIT v. Qatar Airways (332 ITR 253) – The agents of the assessee (airline) were entitled to sell tickets at any price between the fixed commercial price and the published price. As a result the assessee would have no information regarding the final rates at which tickets were sold. It would be impracticable and unreasonable to accept the assessee to collect feedback from its numerous agents on the prices at which tickets are sold. Thus, it was held that the difference between the commercial price and the published price could neither be considered as commission or brokerage in the hands of the agents and hence was not liable to TDS
DHL Express (India) Pvt Ltd vs. ACIT (ITAT Mumbai) The assessee’s argument that comparables with a turnover less than 20% of the assessee’s turnover should be considered is not acceptable because it is a universal fact that there are lot of differences between large businesses and small businesses operating in the same field.
Shantilal M. Jain vs. ACIT (ITAT Mumbai)-Though it is the case of the revenue that due to volume, magnitude, frequency, continuity, regularity, the ratio between purchase and sale clearly indicate that income on account of purchase and sale of shares should be treated as income from business and not as income from STCG, the AO has, from AY 2003-04 to 2008-09 (except for the impugned year 2006-07), consistently accepted the income as being STCG. In these circumstances, the Rule of consistency as propounded by the Bombay High Court in Gopal Purohit 228 CTR 582 (Bom) is squarely applicable and the income has to be treated as STCG.
Recently ITAT Mumbai in the case of ITO vs. United Marine Academy (Mumbai ITAT) held that Assessing Officer thus was right in applying the provision of section 50C to the transfer of depreciable capital assets covered by section 50 and in computing the capital gain arising from the said transfer by adopting the stamp duty valuation.
Explore the judgment in Miscellaneous Appeal No. 620/2009 – Commissioner of Central Excise, Patna vs. H M Media, Patna, regarding abatement of service tax.
J.G. Engineers Pvt. Ltd. Vs. Union of India & ANR. – The Supreme Court has set aside the judgment of the Gauhati high court and upheld the award of the arbitrator in the dispute over delay in the construction of the extension of the Guwahati airport terminal. The contracted period for completion of the project was 21 months, but it was extended twice. The contractor and the government blamed each other for the delay, and ultimately the government cancelled the contract. The dispute was referred to arbitration and the award was in favour of the construction firm. However, the high court set aside the award, leading to the appeal in the Supreme Court (J G Engineers Ltd vs Union of India). The court held that the contractor was entitled to extension of the period for completion of the work, as the delay was caused by the government. The firm was also entitled to escalation costs for the work done during the extended period. It cannot be imposed penalty for the delay. Moreover, since the delay was caused by the government, it cannot make counter-claims against the firm, the judgment said.
CIT Vs M/s Anantha Gas Suppliers (Andhra Pradesh High Court) In the absence of any ambiguity, we have to take into consideration the plain language of the statutory provision and the obvious intention of the Legislature in using such a plain language. The Legislature merely said ‘gas cylinders including valves and regulators’, it has not spelt out any qualification as to the size of the gas cylinder so as to entitle to claim depreciation @ 100%. The decisive factor being the language employed in the statutory provision, we are unable to accede to the view that on account of the container which is in fact a cylinder being mounted on the chassis of the truck, the entire item has to be treated as transport vehicle for which the depreciation can be claimed at 40%.
Recently ITAT Mumbai in the case of Ruchi Strips & Alloys Ltd vs. DCIT held that the concealment of income had its repercussions only when the assessment was done under the normal procedure. If the assessment as per the normal procedure was not acted upon and it was the deemed income assessed u/s 115JB which became the basis of assessment, the concealment had no role to play and was totally irrelevant. The concealment did not lead to tax evasion at all.
The AO’s argument that the assessee could have utilized its surplus funds for repaying the borrowings instead of investing in shares and by not doing so, there was diversion of borrowed funds towards investment in shares to earn dividend income is not acceptable in view of CIT vs. Hero Cycles Ltd 323 ITR 518 (P&H) where Abhishek Industries was distinguished and it was held disallowance u/s 14A of interest on borrowed funds was not permissible if the investment in shares was made out of own funds.
Renu Hingorani vs. ACIT (ITAT Mumbai) – The AO had not questioned the actual consideration received by the assessee but the addition was made purely on the basis of the deeming provisions of s. 50C. The AO had not doubted the agreement or given any finding that the actual sale consideration was more than the sale consideration stated in the sale agreement. The fact that the assessee agreed to the addition is not conclusive proof that the sale consideration as per agreement was incorrect and wrong. Accordingly, there was no concealment of income or furnishing inaccurate particulars of income.
