Direct Tax Vivad Se Vishwas Act | Revival On Default Applies To Proceedings Initiated By Both Department And Assessee: J&K&L High Court

The Jammu & Kashmir and Ladakh High Court has held that under the Direct Tax Vivad Se Vishwas Act, 2020, failure to comply with the conditions of the scheme results in automatic revival of all proceedings withdrawn earlier, irrespective of whether they were initiated by the assessee or the Income Tax Department. A Division Bench of Chief Justice Arun Palli and Justice Rajnesh Oswal ruled that Section 4(6) of the act applies to “all proceedings and claims” without distinction, and therefore...

Taxpayer Must Be Heard Before 'Draconian' Step Of Provisional Attachment: Rajasthan High Court

The Rajasthan High Court on 6 March observed that the minimum requirement before invoking provisional attachment under Section 281B of the Income Tax Act, 1961, is to grant the taxpayer an opportunity of hearing to make the payment, or part of it, given the “draconian” nature of the provision. The Division Bench of Acting Chief Justice Sanjeev Prakash Sharma and Justice Sangeeta Sharma was hearing a petition by ARL Infratech Limited challenging an order of the Deputy Commissioner of Income Tax...

CIT Cannot Reject Delay Condonation Plea On Grounds Beyond Scope of Application: Gujarat High Court

The Gujarat High Court on 9 March held that while deciding an application for condonation of delay under Section 119(2)(b) of the Income Tax Act, the Authority cannot examine issues beyond the scope of the delay condonation request. Section 119(2)(b) empowers the Central Board of Direct Taxes (CBDT) to authorise Income Tax authorities to admit delayed refund or loss carry-forward claims on showing “genuine hardship.” A Division Bench of Justice A. S. Supehia and Justice Pranav Trivedi held...

Gujarat High Court Sets Aside Transfer Of Income Tax Case From Ahmedabad To Rajkot Without Hearing Taxpayer

The Gujarat High Court has set aside an order transferring an assessee's income-tax reassessment case from Ahmedabad to Rajkot after finding that the transfer was made without granting the taxpayer an opportunity of hearing as required under the Income Tax Act. The division bench of Justice A. S. Supehia and Justice Pranav Trivedi held that in the present case the transfer of jurisdiction under Section 127(2) of the Income Tax Act could not be sustained since it had been effected without...

Vehicle Possession And Document Transfer Concludes A Sale For Capital Gains Tax: Madras High Court

The Madras High Court has held that delivery of a vehicle along with its original documents may constitute a completed sale for income-tax purposes, even if the registration certificate is not formally transferred in the buyer's name. A Bench comprising Justice C. Saravanan dismissed the writ petition filed by Dr. Arvind Kumar R. Shaw (the petitioner), upholding the assessment order passed by the Income Tax Department treating the sale of his Rolls‑Royce as a short-term capital gains...

Reassessment Notice Not Time-Barred In Case Where Delay Caused By Taxpayer's Adjournment Requests: Delhi High Court

The Delhi High Court has held that a reassessment notice issued under Section 148 of the Income Tax Act cannot be treated as time-barred when the delay occurred due to adjournments sought by the taxpayer during proceedings under Section 148A.A Division Bench of Justices Dinesh Mehta and Vinod Kumar dismissed writ petitions filed by two private companies challenging notices issued for Assessment Year (AY) 2017–18 on the ground that they were issued after the limitation period had expired.The...

Penalty Order Is In Limitation If Issued Within Six Months Of Appellate Order: Madras High Court

The Madras High Court on 6 February held that when penalty proceedings arise from assessment orders and the assessment is challenged on appeal, the limitation period for issuing a penalty can be computed from the appellate order. A penalty issued within the prescribed period after the appellate decision is therefore not time-barred. Justice Senthilkumar Ramamoorthy upheld a penalty imposed on actor Joseph Vijay under the Income Tax Act, 1961, observing that the penalty order dated 30 June 2022...

No Penalty For Erroneous Claim Based On Bona Fide Interpretation Of Tax Treaty: Madras High Court

The Madras High Court on 5 February held that an erroneous claim of double taxation relief by itself cannot lead to a penalty under Section 271(1)(c) of the Income Tax Act, 1961 when the taxpayer has fully disclosed the relevant income and the claim arises from a bona fide interpretation of law. A Division Bench of Dr. Justice Anita Sumanth and Justice Mummineini Sudheer Kumar heard appeals filed by the Commissioner of Income Tax against Indian Overseas Bank challenging an order of the Income...

J&K&L High Court Upholds Income Tax Addition After Taxpayer Gave Inflated Stock Statement To Bank

The Jammu & Kashmir and Ladakh High Court on Wednesday upheld an addition to taxable income made on the basis of a stock statement furnished by a taxpayer to a bank while availing a cash credit facility, holding that the tax authorities were justified in relying on the declaration where discrepancies with the books of account remained unexplained. A Division Bench of Chief Justice Arun Palli and Justice Rajnesh Oswal dismissed an appeal filed by Ajay Food Products challenging an...

AO Cannot Reopen Assessment On Same Material To Cure Lapse In Original Proceedings: Gujarat High Court

The Gujarat High Court on 24 February ruled that the Revenue cannot initiate reassessment proceedings under Section 148 of the Income Tax Act based on the same material that was already scrutinised in the original proceedings, which later lapsed due to the Assessing Officer's failure to meet the statutory deadlines. The Division Bench of Justice A.S. Supehia and Justice Pranav Trivedi held that reopening an assessment in such circumstances is an impermissible attempt to “camouflage”...

DTVSV Scheme 2024 Inapplicable To Reassessments Arising From Search Proceedings: Gujarat High Court

The Gujarat High Court on 18 February held that taxpayers whose reassessment proceedings arise from incriminating material discovered during search operations under Sections 132 or 132A of the Income Tax Act are not eligible to avail the benefit of the Direct Tax Vivad Se Vishwas (DTVSV) Scheme, 2024. A Division Bench of Justice A.S. Supehia and Justice Pranav Trivedi dismissed a batch of writ petitions led by Radha Madhav Eco-Industrial Park, which challenged the rejection of their...

Transfer Pricing Adjustment Cannot Amount To 'Misreporting of Income': Madras High Court Quashes Penalty On Verizon

The Madras High Court has recently quashed penalty proceedings against Verizon Data Services India Pvt Ltd, holding that a transfer pricing adjustment based on estimation of arm's length price cannot by itself constitute “misreporting of income” under Section 270A of the Income Tax Act.A single-bench of Justice C. Saravanan, while quashing the penalty order and rejection of its immunity application against Verizon observed,"The entire basis for initiation of penalty proceedings is the transfer...