[S.292B Income Tax Act] Inadvertent Mistakes In Reassessment Can Be Saved But Assessment Order Overlooking Apparent Error Cannot: Delhi HC

The Delhi High Court has made it clear that Section 292B of the Income Tax Act, 1961 cannot be used to save an assessment order passed by overlooking errors apparent on face of the record.The provision provides that no notice or assessment or any proceedings can be deemed to be invalid merely for the reason of any mistake, defect or omission in such notice, assessment or other proceedings.A division bench of Chief Justice Devender Kumar Upadhyay and Justice Tushar Rao Gedela said while the...

Enterprise Manufacturing Specified Items In Designated States Can Seek Tax Deduction U/S 80IC Income Tax Act Without Agreement With Govt: Delhi HC

The Delhi High Court has held that Section 80IC of the Income Tax Act, 1961, which contemplates tax incentives for enterprises operating in specific industries and locations in India, does not require such enterprises to enter into an agreement with the Government.In doing so, a division bench of Justices Yashwant Varma and Harish Vaidyanathan Shankar distinguished the provision from Section 80IA, whereunder agreement with the Centre, State or local authority is a pre-condition for claiming...

CBDT Cannot Impose Limitations To Extinguish Rights Granted Under Income Tax Act: Delhi High Court

Recently, the Delhi High Court held that Central Board of Direct Taxes (CBDT) cannot impose limitations to extinguish rights granted under Income Tax Act, 1961. The Court held that the wide powers granted to the CBDT are not for extinguishing a right that is conferred by the Act. Accordingly, the Court Circular No. 07/2007 dated 23 October 2007 issued by the CBDT to the be ultra vires the Income Tax Act.Circular No. 07/2007 dated 23 October 2007 issued by the Central Board of Direct Taxes...

Man Accused Of Taking ₹2 Crore Dowry Seeks Income Tax Dept Probe Into Wife's Family, Delhi High Court Rejects Plea

The Delhi High Court has rejected the writ petition filed by a man, seeking an inquiry into the finances of his wife and her family who claimed to have paid him ₹2 crores dowry, in addition to spending crores of rupees on their wedding.A division bench of Chief Justice Devendra Kumar Upadhyaya and Justice Tushar Rao Gedela observed that the complaint stemmed from a matrimonial feud and the man was unable to indicate the provision under which such a complaint was made to the Income Tax...

Delhi High Court Quashes ₹2000 Crore Tax Reassessment Notice Against Maruti Suzuki For Alleged Escapement Of Income In AY 2009-10

The Delhi High Court has quashed the reassessment action initiated by the Income Tax Department against car manufacturer Maruti Suzuki India Ltd for alleged escapement of income in the Assessment Year 2009-10.A division bench of Justices Yashwant Varma and Ravinder Dudeja observed that the company had made full and true disclosure of all facts in the course of the assessment and the Department did not have jurisdiction to reopen the assessment under Sections 147/148 of the Income Tax Act,...

S.197 IT Act | AO Must Form Prima Facie Opinion Regarding Taxability In India Before Rejecting Assessee's Application For Nil TDS: Delhi HC

The Delhi High Court has made it clear that before rejecting an assessee's application under Section 197 of the Income Tax Act 1961 for nil TDS or deduction of tax at a lower rate, the assessing officer must form a prima facie opinion regarding the assessee's taxability in India.Section 197(1) of the Act enables an assessee to make an application for a certificate requiring the deduction of tax at a lower rate or no deduction at all if the Assessing Officer is satisfied that the total income of...

AO Becomes 'Functus Officio' After Closure Of Assessment, Must Put Relevant Incriminating Material To Assessee To Re-Confer Jurisdiction: Delhi HC

The Delhi High Court has made it clear that after the closure of assessment proceedings, the Assessing Officer becomes 'functus officio' and to re-confer jurisdiction upon the AO to initiate re-assessment proceedings, relevant incriminating material ought to be put to the assessee.A division bench of Chief Justice Devendra Kumar Upadhyaya and Justice Tushar Rao Gedela made the observation while dealing with a writ petition filed by Vivo Mobiles, assailing the reassessment proceedings initiated...

Cash Seized From Assessee Cannot Be Retained By GST Dept Or IT Dept Prior To Finalisation Of Proceedings: Kerala High Court

The Kerala High Court stated that illegal cash seizure by GST Department and handing over to Income Tax Department is illegal under Section 132A of the Income Tax Act. The Division Bench of Justices A.K. Jyasankaran Nambiar and Easwaran S. held that “Cash amount seized from the premises of the assessee cannot be retained either by the GST Department of the State or the Income Tax Department prior to a finalisation of respective proceedings initiated by them,” In this case, the...

Income Tax Act | 'Fee For Technical Services' Means Transfer Of 'Specialised'/ 'Distinctive' Knowledge Or Skill By Service Provider: Delhi HC

The Delhi High Court has held that Fee for Technical Services (FTS) as contained under Section 9(1)(vii) of the Income Tax Act, 1961 is concerned with the transfer of 'distinctive', 'specialized' knowledge, skill, expertise and know-how by a service provider.A division bench of Justices Yashwant Varma and Harish Vaidyanathan Shankar thus observed that assistance provided by the assessee-respondent with respect to rules and regulations for clearance of customs frontiers is not 'specialised...

Charitable Trust's Registration For Income Tax Exemption To Be Decided Based On Proposed Activities & Not Actual Activities : Supreme Court

The Supreme Court reiterated that when a charitable trust applies under Section 12-AA of the Income Tax Act (“Act”) for income tax exemptions (under Sections 10 and 11), the tax authorities should decide on the registration based on the charity's "proposed activities" than its actual activities, as stated in the Ananda Social case. The Court, however, clarified that mere registration under Section 12-AA would not entitle a charitable trust to claim exemption under Sections 10 and 11...

Income Tax Act | No Penalty Under S.271AAA If Undisclosed Income Is Admitted, Explained & Tax Paid Even With Delay : Supreme Court

The Supreme Court, while determining a tax matter, observed that the undisclosed income, under Section 271AAA(1) of the Income Tax Act, surrendered by the assessee during the search, is not sufficient to levy the penalty. Essentially, the said provision talks about penalty where a search has been initiated. The explanation reads as: “(a) “Undisclosed income” means— (i) any income of the specified previous year represented, either wholly or partly, by any money, bullion, jewellery or...

High Court Within Whose Jurisdiction AO Passes Assessment Order Has Jurisdiction To Entertain Appeal U/S 260A Income Tax Act: Delhi HC

The Delhi High Court has reiterated that only such High Court within whose jurisdiction the Assessing Officer passing an impugned assessment order is situated would have the jurisdiction to entertain an appeal under Section 260A of the Income Tax Act, 1961.The Section makes provision for an appeal to the High Court from an order passed in appeal by the Appellate Tribunal.In the case at hand, the original assessment order was passed by the AO in Amritsar, making an addition of ₹4,37,046/- to the...