Old Income Tax Demands Cannot Surface On Portal Without Serving Underlying Orders: Bombay High Court

The Bombay High Court recently observed that old income tax demands could not be sustained where the underlying orders were not made available to the taxpayer, observing that such demands cannot be permitted to surface without proper disclosure. “Old matters and demands cannot be allowed to suddenly surface on the portal without the underlying orders being available and served. Consequently, the impugned demands cannot be sustained,” the court said. A Division Bench of Justices B. P....

Lottery Ticket Discount Not “Commission” Absent Payment Or Credit, No TDS Applicable: Madras High Court

The Madras High Court on 9 April held that the difference between the face value of lottery tickets and the discounted price at which a taxpayer sells them to dealers does not constitute “commission.” Therefore, it is not subject to tax deduction at source (TDS) under Section 194G of the Income Tax Act. The Division Bench of Justices G. Jayachandran and Shamim Ahmed dismissed the Revenue's appeal and upheld the Tribunal's order in favour of Martin Lottery Agencies Ltd. The judges observed: ...

Final Assessment Without Draft Order Under Section 144C Invalid: ITAT New Delhi

The New Delhi Bench of the Income Tax Appellate Tribunal (ITAT) on 10 April, held that the Assessing Officer's failure to issue a draft assessment order under Section 144C(1) of the Income Tax Act renders the final order void. The Bench comprising Judicial Member C N Prasad and Accountant Member M Balaganesh allowed the appeals filed by Sumitomo Corporation India Pvt. Ltd. against the assessment orders passed by the Deputy Commissioner of Income Tax. The Tribunal held: “the Final...

Pre-2002 Transfer Of Self-Generated Trademarks With No Cost Of Acquisition Not Taxable: Gujarat High Court

The Gujarat High Court on 12 March, held that consideration of Rs.29.10 crore received by Zydus Lifesciences Limited on assignment of self-generated trademarks prior to 1 April 2002 is not chargeable to tax either as capital gains or as business income under the Income Tax Act, 1961. A Division Bench of Justices A.S. Supehia and Justice Pranav Trivedi dismissed the Revenue's appeal and affirmed the Tribunal's view that, in the absence of an ascertainable cost of acquisition, the charging...

No Penalty If High Court Admits Quantum Issue As Substantial Question Of Law: Mumbai ITAT

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) on 15 April held that “penalty” under Section 271(1)(c) of the Income Tax Act cannot be sustained where the quantum issue has already been admitted by the High Court as a substantial question of law. A Bench comprising Judicial Member Sandeep Singh Karhail and Accountant Member Bijayananda Pruseth quashed the penalty imposed on the Small Industries Development Bank of India, holding that admission of a substantial question...

Demonetisation Deposits From Cash In Hand Cannot Be Rejected Without Evidence: Allahabad High Court

The Allahabad High Court on 8 April held that where a taxpayer explains cash deposits during 2016 Indian demonetization as arising from cash in hand, the Assessing Officer cannot reject the explanation in the absence of any material to the contrary. A Bench comprising Justices Shekhar B. Saraf and Abdhesh Kumar Chaudhary dismissed the appeal filed by the Principal Commissioner of Income Tax, Lucknow against Medharaj Techno Concept Pvt. Ltd. and upheld the order of the Income Tax Appellate...

Share Buyback Not Acquisition Of Property: Delhi High Court Deletes ₹16.33 Crore Tax Addition Against Globe Capital

The Delhi High Court has upheld the deletion of a Rs 16.33 crore addition against Globe Capital Market Ltd., holding that a company's buyback of its own shares does not amount to acquisition of “property” and Section 56(2)(x) of the Income Tax Act has no application to such transactions. A Division Bench of Justices Dinesh Mehta and Vinod Kumar dismissed the appeal filed by the Principal Commissioner of Income Tax, affirming the Income Tax Appellate Tribunal's decision, which had upheld relief...

ITAT Mumbai Allows Co-operative Society Tax Deduction On Interest Income From Co-op Banks

The Mumbai Bench of the Income Tax Appellate Tribunal has granted relief to a co-operative society by holding that deduction under Section 80P(2)(d) is allowable on interest income earned from deposits with co-operative banks, noting that the issue is already covered by judicial precedents including Pathare Prabhu Cooperative Housing Society Ltd. v. ITO. “As the issue is squarely covered in favour of the Assessee by the aforesaid judgment referred to above, thus, the addition under...

Revenue Cannot Disallow Trademark Depreciation Once Accepted In Initial Year: ITAT Mumbai

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) on 10 April held that depreciation on a trademark arising out of an amalgamation, once allowed in the initial year, cannot be disallowed in subsequent years in the absence of any change in facts. A Bench comprising Accountant Member Om Prakash Kant and Judicial Member Sandeep Singh Karhail delivered the ruling while deciding Revenue's appeals and Transworld Furtichem Private Limited's cross-objections for multiple assessment years. It...

ITAT New Delhi Dismisses Revenue Appeal Against Bharat Kalia, Finds No 50CA Violation In Share Sale

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) on 10 April dismissed the Revenue's appeal against Bharat Kalia and held that no addition under Section 50CA of the Income Tax Act, 1961 can be made where the sale consideration of unquoted shares exceeds the fair market value determined under the prescribed rules. Section 50CA applies when a taxpayer transfers unquoted shares at a price lower than their fair market value (FMV), triggering substitution of the consideration for tax...

ITAT Mumbai Grants Relief To Sachin Khedekar, Holds Delay In Filing Form 67 Not Fatal For FTC Claim

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) on 10 April allowed an appeal filed by actor Sachin Shrikant Khedekar and held that delay in filing Form No. 67 is a procedural lapse and cannot justify denial of foreign tax credit under Section 90 of the Income Tax Act, 1961. A Bench of Judicial Member Sandeep Singh Karhail and Accountant Member Bijayananda Pruseth held: “.....mere delay in filing Form No. 67 as per the provisions of Rule 128(9), as they stood during the year...

CBDT Delay Condonation Circular For 'Genuine Hardship' Applies Irrespective Of Assessment Year: Delhi High Court

The Delhi High Court has held that a beneficial circular issued by the Central Board of Direct Taxes (CBDT) allowing delay condonation in cases of “genuine hardship” cannot be restricted to specific assessment years and must be applied uniformly to all bona fide cases.A Division Bench of Justices Dinesh Mehta and Vinod Kumar passed the ruling while allowing a writ petition filed by VRG Electronics Pvt. Ltd., challenging the rejection of its application for condonation of delay in filing...