INCOME TAX
Benefit Of Carried Forward Business Losses And Unabsorbed Depreciation Losses Can't Be Availed For Ingenuine Amalgamation/Demerger: ITAT
The Pune Bench of the Income Tax Appellate Tribunal (ITAT) consisting of S.S. Vishwanethra Ravi (Judicial Member) and Inturi Rama Rao (Accountant Member) has held that the benefit of section 72A of the Companies Act, 1956 cannot be availed if the sole idea of the amalgamation was only to avail the benefit of carried forward business losses and unabsorbed depreciation losses as it is not for genuine purpose. The respondent/assessee is a company incorporated under the provisions of...
ITAT Directs Revenue To Give Effect To High Court Order Holding Software License Charges Received By EY Not Taxable As 'Royalty'
The Delhi Bench of ITAT has directed the revenue authorities to give effect to the order passed by the Delhi High Court in favour of EY Global Services Limited (UK) (EYGSL (UK), holding that payments received by EYGSL (UK) from its member firms in India, towards Software License and Maintenance Charges, Global Technology Charges and GWAN Connectivity Charges, are not taxable in India. The Bench, consisting of Astha Chandra (Judicial Member) and Shamim Yahya (Accountant Member), noted...
SFIS Credit Does Not Constitute Taxable Income: ITAT Delhi
The Delhi Bench of ITAT has ruled that the credit received by the assessee under the "Served From India Scheme" (SFIS) is not in the nature of income and that it does not constitute taxable income under Section 2(24) (xviii) of the Income Tax Act, 1961. The Bench, consisting of Yogesh Kumar US (Judicial Member) and Dr. B.R.R. Kumar (Accountant Member), observed that the SFIS credit had only reduced the value of a capital asset in the books of accounts of the assessee by the amount of...
Expenditure Incurred On Trademark Registration Is A Revenue Expenditure: ITAT Allows Deduction
The Ahmedabad Bench of the Income Tax Appellate Tribunal (ITAT)has allowed the deduction and held that the expenditure incurred on trademark registration is a revenue expenditure. The two-member bench of Suchitra Kamble (Judicial Member) and B.M. Biyani (Accountant Member) has ruled that the amendment in section 32 of the Income Tax Act from A.Y. 1999-2000 which allows deprecation on various intangible assets (including trademarks) is applicable only when the cost incurred in...
Sufficiency Or Inadequacy Of Reasons To Believe Cannot Be Looked Into While Considering Validity Of Search & Seizure U/Sec 132 Income Tax Act: Supreme Court
The Supreme Court, in a judgment delivered on Wednesday, restated the principles in exercising the writ jurisdiction in the matter of search and seizure under Section 132 of the Income Tax Act."The sufficiency or inadequacy of the reasons to believe recorded cannot be gone into while considering the validity of an act of authorization to conduct search and seizure", the bench comprising Justices Hemant Gupta and V. Ramasubramanian observedThe court was considering an appeal against the judgment...
Cash Deposits Related To 'Shroff Business' Is Not An Undisclosed Income: ITAT
The Rajkot Income Tax Appellate Tribunal (ITAT), consisting of TR Senthil Kumar (Judicial Member) and Annapurna Gupta (Accountant Member), has ruled that the cash deposits related to the Shroff business are not an undisclosed income. The assessee/respondent is in a Shroff business and derives income from commission. The AO had information that there was a cash deposit of Rs.224.53,23,993 during the year in 16 bank accounts of the assessee. Accordingly, the assessee was asked to...
Twin Conditions In Section 10B (8) Income Tax Act Has To Be Fulfilled To Claim Exemption Relief: Supreme Court
For claiming the benefit under Section 10B (8) of the Income Tax Act, the twin conditions of furnishing a declaration before the assessing officer and that too before the due date of filing the original return of income under section 139(1) are to be satisfied and both are mandatorily to be complied with, the Supreme Court observed in a judgment delivered yesterday. Section 10B (8) IT ActThe Section 10B (8) IT Act reads as follows: Notwithstanding anything contained in the foregoing...
Sale Of Renewable Energy Certificate Of Income Received By The Assessee Is A Capital Receipt: ITAT
The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) has held that the sale of renewable energy certificates (carbon credit) of income received by the assessee is a capital receipt. The two-member bench of Kuldip Singh (Judicial Member) and Gagan Goyal (Accountant Member) has observed that the sale of carbon credit could not be a business receipt or income, nor is it directly linked with the business of the assessee, nor any asset is generated in the course of business, but it...
Approval Of Demerger Would Not Entail The Benefit Of Set-Off Under Section 72A Of Income Tax Act: ITAT
The Pune Bench of ITAT has ruled that the mere fact that the scheme of demerger or amalgamation was approved by the High Court, does not automatically entitle the assessee to claim the set-off of brought forward business losses relating to the demerged or amalgamating undertaking. The Bench, consisting of S. S. Viswanethra Ravi (Judicial Member) and Inturi Rama Rao (Accountant Member), held that Section 72A (5) of the Income Tax Act, 1961 has been enacted empowering the Assessing...
ITAT Directs AO To Allow Depreciation On Molasses Tanks By Making The Correct Computation Of New Assets
The Kolkata Bench of the Income Tax Appellate Tribunal (ITAT), consisting of Aby T Varkey (Judicial Member) and Girish Agarwal (Accountant Member), has directed the assessing officer to allow the depreciation on molasses tanks by making the correct computation of new assets. The appellant/assessee is a limited company and is in the business of manufacturing sugar. It has its registered office at Kolkata and a factory at Sasa Musa, Dist. Gopalganj, Bihar. The assessee filed its return of ...
Imparting Skill Development Is Akin To Providing Education, Eligible For Section 12AA Registration: ITAT
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) consisting of Yogesh Kumar U.S. (Judicial Member) and B.R.R. Kumar (Accountant Member) has held that the assessee is eligible for registration under section 12AA of the Income Tax Act for imparting skill development, which is akin to providing education. The appellant/assessee, C.R. Dadhich Memorial Society was established under the Haryana Registration and Regulation of Societies Act, 2012 on 02.03.2016. The objective of the...
Fee Paid For Client Referral Services Is A Normal Business Payment And Not FTS: ITAT Delhi
The Delhi Bench of ITAT has ruled that fees paid by the assesssee to a non-resident for providing services of introduction of clients would fall in the definition of payments made to an intermediary and the same cannot be said to be a technical service. The Bench, consisting of Anubhav Sharma (Judicial Member) and Shamim Yahya (Accountant Member), held that the remittances made by the assessee to its intermediary for providing client referral services would not come within the scope of...