Bombay High Court Condones 430-Day Delay By Charitable Trust In Filing Declaration For Tax Exemption

The Bombay High Court has condoned a 430-day delay by Bombay Prathana Samaj, a charitable trust, in submitting a mandatory declaration required for claiming a tax exemption benefit, after finding that the trust had shown reasonable cause for the delay and would otherwise suffer genuine hardship. “The approach of the authority ought to be equitious, balancing and judicious and availing of exemption should not be denied merely on the bar of limitation,” the Court observed while referring to the...

Delhi High Court Refuses To Condone Delay In Late Filing To Opt Lower Corporate Tax Regime

The Delhi High Court has recently refused to condone delay by a company in opting for a concessional corporate tax regime, holding that its application filed beyond the three-year limit prescribed under a CBDT circular was not maintainable.The division bench of Justices Dinesh Mehta and Vinod Kumar thus dismissed the writ petition filed by a company challenging the rejection of its application under Section 119(2)(b) of the Income Tax Act seeking condonation of delay in filing Form 10-IC for...

Gujarat HC Upholds Constitutionality Of CGST Provision Denying ITC To Buyers If Supplier Fails To Pay Tax

The Gujarat High Court has on Friday upheld the constitutional validity of a GST provision that denies input tax credit to a purchaser if the supplier has not deposited the tax with the government. The court upheld the validity of Section 16(2)(c) of the Central Goods and Services Tax Act, 2017, holding that entitlement to input tax credit is conditional upon actual payment of tax to the government. Emphasising that there was no constitutional infirmity in the provision, the court held, ...

In Faceless Assessment, Income Tax Revision Cannot Be Decided Without Inquiry: Gauhati High Court

The Gauhati High Court has held that the revisional authority cannot dispose of revision proceedings in a mechanical manner under the Income Tax Act (Section 264), which allows a taxpayer to seek revision of an order through a faceless process without making, or causing, an enquiry. This is especially so where the assessee claims difficulty in producing voluminous records and seeks verification at the place of business. The court referred to an earlier Division Bench ruling that held that...

Is India–UK DTAA Benefit Available On Dividend Distribution Tax? Bombay High Court Refers Issue To Larger Bench

The Bombay High Court has referred to a larger bench the question of whether companies paying Dividend Distribution Tax (DDT) can claim the benefit of lower tax rates under the India–UK tax treaty. The court was hearing appeals filed by Foseco India Ltd. challenging the denial of a refund of excess income tax paid. The issue, though arising in the context of the India–UK tax treaty, could also affect how similar provisions in other tax treaties are applied. A Division Bench of Justices G.S....

Deductions For Captive Power Profits Cannot Reduce Export Profit Deduction When Businesses Are Separate: Calcutta HC

The Calcutta High Court has ruled that deductions claimed on profits from captive power generation and export businesses must be computed independently and cannot be reduced against each other where the incomes arise from distinct sources. “The deduction granted under Section 80-IA cannot be reduced while computing profits eligible for deduction under Section 80HHC where the deductions arise from independent businesses,” the court held. A division bench of Justice Rajarshi Bharadwaj and...

Madras High Court Refuses To Quash Tax Evasion Case, Says Wilfulness Is Matter For Trial

The Madras High Court has refused to quash criminal proceedings against a taxpayer accused of failing to pay admitted income tax dues, noting that the issues raised had already been urged before the trial court and could not be re-agitated at a belated stage. A single-judge bench of Justice M. Niraml Kumar was dealing with a petition filed by Abdul Khader Mohammed Farook seeking to quash proceedings pending before the Additional Chief Metropolitan Magistrate (Economic Offences), Egmore, for...

ITAT Can't Grant Tax Benefits To Charitable Institution Without Proper Inquiry Delhi HC

The Delhi High Court has held that a tax appellate tribunal cannot directly grant tax exemption benefits to a charitable trust without first ensuring that a proper inquiry into its activities has been carried out. A division bench of Justices Dinesh Mehta and Vinod Kumar passed the ruling while setting aside an order of the Income Tax Appellate Tribunal (ITAT), which had directed the grant of registration and approval to Sukoon SP Foundation, a charitable trust.The trust had applied for...

Telangana High Court Quashes IT Reassessment On Issue Already Examined, Calls It Change of Opinion

The Telangana High Court has set aside income tax reassessment proceedings against Piramal Swasthya Management and Research Institute, holding that the tax department cannot reopen an issue it had already examined and accepted during the original assessment. “once the assessment proceedings are completed and assessment order is passed, the 1st respondent cannot reopen the assessment proceedings by issuing the impugned show-cause notice, dt.27.02.2023, alleging that Form 10 had not been...

Delhi High Court Says 100% Shareholding Not Enough To Tax Shareholders For Company's Income

The Delhi High Court has held that shareholders, even if holding all the shares of a company, are only owners of the shares and not of the company's assets, and therefore the company's income cannot be taxed in their hands. “Legally speaking, the respondents being shareholders of the company, even if holding all the shares (100%), are only owners of the shares of the company and not the owners of the property as such and similarly the income which that company has earned cannot ipso-facto be...

Telangana High Court Upholds 1% Royalty Cap On Export Sales, Dismisses Gulf Oil Appeals

The Telangana High Court on 26 March, upheld the restriction of royalty on export sales to 1% for Gulf Oil Corporation Ltd., holding that regulatory approvals permitting higher royalty rates do not determine arm's length price under transfer pricing provisions, which operate as a self-contained code under Sections 92 to 92F of the Income Tax Act. The Division Bench comprising Justices P. Sam Koshy and Suddala Chalapathi Rao held that no substantial question of law arose in the matter and...

Approval By Additional Commissioner Valid As “Joint Commissioner” Under Income Tax Act: Kerala High Court

The Kerala High Court, on 8 April, held that approval granted by an Additional Commissioner of Income Tax satisfies the statutory requirement under Section 274(2) of the Income Tax Act for imposing penalties. It clarified that the term “Joint Commissioner” includes an Additional Commissioner under Section 2(28C) of the Act. Justice Ziyad Rahman A.A. dismissed a batch of writ petitions filed by Service Cooperative Bank Limited, holding that the challenge failed on the limited question of the...