Income Tax Department Can't Retain Tax Collected Twice On Same Income: Telangana High Court

The Telangana High Court has held that the Income Tax Department cannot retain tax collected twice on the same income and that the Commissioner must exercise powers under Section 264 of the Income Tax Act, 1961. The provision enables revision of an assessment to provide relief against over-assessment, even where the mistake is attributable to the taxpayer. A Division Bench comprising Justices P. Sam Koshy and Narsing Rao Nandikonda made the observation while allowing a writ petition filed by...

Supreme Court Upholds TVS Motor's Referral Charges As Business Auxiliary Service, Sets Aside Penalty

The Supreme Court on 19 August held that TVS Motor Company Limited was liable to pay service tax on referral charges it received from banks and an insurance company for facilitating vehicle loans and insurance policies, treating the charges as Business Auxiliary Service under the Finance Act, 1994. However, the Division Bench comprising Justices J.B. Pardiwala and K. Vinod Chandran set aside the penalty imposed on the company under Section 78 of the Finance Act, after finding that it had paid...

Separately Imported Laptop LCD Panels Are Flat Panel Displays, Not Computer Parts: CESTAT Delhi

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Delhi, has held that separately imported laptop LCD panels are classifiable as flat panel display modules, rather than as parts or accessories of computers. The tribunal ruled that their intended use in laptops could not determine their classification when the goods retained their identity as separately presented display modules at the time of import.“The appellant has impressed upon his goods to be the Laptop monitors which...

Delhi High Court Sets Aside Income Tax Penalty For Furnishing Inaccurate Income Particulars Over Defective Notice

The Delhi High Court has held that a penalty imposed under Section 271(1)(c) of the Income Tax Act, 1961, cannot be sustained if the notice issued to the assessee fails to specify the particular limb under which the penalty proceedings are proposed.The division bench of Justices Dinesh Mehta and Rajneesh Kumar Gupta rejected the Revenue's appeal against an ITAT order which had set aside the penalty imposed on Vitasta Estates.It noted that Section 271(1)(c) contemplates two distinct grounds for...

Husband Cannot Claim Capital Gains Exemption For Property In Wife's Name: Punjab & Haryana High Court

The Punjab and Haryana High Court on 12 August held that capital gains exemption under Section 54 of the Income Tax Act cannot be claimed where a residential property is sold and the proceeds are reinvested in another residential property purchased solely in the name of the taxpayer's wife. A Division Bench of Justices Deepak Sibal and Rupinderjit Chahal dismissed an appeal filed by Subh Karan Yadav, a retired government employee, against the order of the Income Tax Appellate Tribunal (ITAT)...

Gujarat High Court Quashes Reassessment Against Adani Exports For AY 2010-11

The Gujarat High Court has quashed reassessment proceedings against Adani Exports for AY 2010-11. It found that the Assessing Officer had relied on an unamended partnership deed while reopening the assessment, despite the assessee having specifically informed him that the deed had been amended to remove the obligation to pay interest on partners' capital.A Division Bench comprising Justice A.S. Supehia and Justice Vaibhavi D. Nanavati held that the amended partnership deed expressly provided...

CESTAT Taxability Appeals Lie Before Supreme Court U/S 35L Of Central Excise Act: Telangana High Court

The Telangana High Court has held that an appeal against a Customs, Excise and Service Tax Appellate Tribunal (CESTAT) order involving the taxability or classification of a service lies before the Supreme Court under Section 35L of the Central Excise Act, and not before the High Court under Section 35G. A Division Bench comprising Justices P. Sam Koshy and Narsing Rao Nandikonda dismissed an appeal filed by the Principal Commissioner of Central Tax & Customs against Mars International...

Merely Because No Income Was Booked, Business Expenses Cannot Be Disallowed: Gujarat High Court

The Gujarat High Court has recently ruled that expenses incurred on business projects cannot be disallowed merely because no income was booked against them for the relevant year. The court noted that if the Revenue's case was that no income had been booked, it had to determine whether the assessee had failed to account for that income or had not treated a particular receipt as income.“Merely because no income has been booked against the same, it would not result into disallowance of such...

No Income Tax On RFCTLARR Land Acquisition Compensation: Andhra Pradesh High Court

The Andhra Pradesh High Court on 7 August held that compensation paid for compulsory acquisition of land under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (RFCTLARR Act) is exempt from income tax, except in cases covered by Section 46 of the Act. A Single Bench comprising Justice Tarlada Rajasekhar Rao set aside the executing court's orders permitting deduction of tax from compensation awarded to landowners and remanded the...

Transitioned CENVAT Credit Valid For Service Tax Appeal Pre-Deposit: Karnataka High Court

The Karnataka High Court on 4 August held that CENVAT credit transitioned to the Goods and Services Tax (GST) regime can be used to meet the mandatory pre-deposit requirement for a service tax appeal. A Division Bench of Justices S.G. Pandit and K. Manmadha Rao set aside the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) order rejecting a pre-deposit of Rs.79,77,301 made by debiting the Electronic Credit Ledger through Form GSTR-3B. The judges held: "The mandatory pre-deposit...

Aircraft 'Dry Lease' Taxable Where Lessor Retains Possession, Effective Control: CESTAT Chennai

The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that merely calling an aircraft arrangement a “lease” does not mean that possession and effective control have been transferred to the other party. The tribunal found that Orient Flight School retained effective control and legal possession of the aircraft, and upheld the service tax levy on the arrangement as “Supply of Tangible Goods Service.""Though the agreement uses terms like “lease” and “lessee”,...

Photograph Of Handwritten Note Cannot Independently Prove Cash Transaction: ITAT Chennai

The Chennai Bench of the Income Tax Appellate Tribunal (ITAT) has held that a photograph of a handwritten document cannot independently establish an alleged cash payment when it is merely an electronic reproduction of the same document.The Bench of Judicial Member Manu Kumar Giri and Accountant Member S.R. Raghunatha made the observation while upholding the deletion of a ₹18.87 crore addition against Ivar Estates Private Limited. The Revenue had alleged that the company paid the amount in cash,...