Income Tax Dept. Can't Initiate Reassessment Proceedings During The Pendency Of The Rectification Proceedings: Supreme Court

The Supreme Court has held that the income tax department cannot initiate the reassessment proceedings during the pendency of the rectification proceedings.The division bench of Justice M.R. Shah and Justice C.T. Ravikumar has observed that the Punjab and Haryana High Court has committed a serious error in holding that the notice under Section 154 was invalid as it was beyond the period of limitation. The proceedings under Section 154 of the Income Tax Act were not the subject matter before the...

ITAT Deletes Addition On Account Of Cash Deposited In The Bank Accounts During Demonetisation Period

The Raipur Bench of the Income Tax Appellate Tribunal (ITAT) has deleted the addition on account of cash deposited in bank accounts during the demonetization period.The bench of Ravish Sood (a judicial member) has observed that the AO, by not rejecting the books of account, has clearly accepted that the cash deposited in the bank accounts by the assessee firm during the year under consideration was not from its disclosed sources.The appellant/assessee firm, which operates a cold storage...

No Fraudulent Intention Established: Gujarat High Court Quashes Penalty

The Gujarat High Court has held that the department could not establish any element of tax evasion with fraudulent intent or negligence.The division bench of Justice Sonia Gokani and Justice Mauna M. Bhatt has observed that the delay was of almost 4 1⁄2 hours before the e-Way bill could expire. It appeared to be bonafide and without establishing any fraudulent intention.The petitioner/assessee is a transport authority, which goes by the name and style of "Shree Ram Road Carriers."The petitioner...

Interest Income Earned By Co-Operative Society From Investments Made With Co-Operative Banks Is Eligible For Section 80P Deduction: ITAT

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) has allowed the deduction under section 80P(2)(d) of the Income Tax Act in respect of interest earned by cooperative societies from investments made with cooperative banks.The two-member bench of Aby T. Varkey (Judicial Member) and Amarjit Singh (Accountant Member) has relied on the decision of the Karnataka high court in the case of PCIT VS Totagar's Cooperative Sales Society, in which it was held that the interest income derived by...

ITAT Allows Section 80G Deduction To The Trust Which Is Not Substantially Religious

The Pune Bench of the Income Tax Appellate Tribunal (ITAT) has allowed the deduction under Section 80G of the Income Tax Act to the trust, which is not substantially religious.The two-member bench headed by R.S. Syal (Vice President) and Partha Sarthi Chaudhury (Judicial Member) has observed that if a trust or institution incurs expenses for religious purposes, which are inclusive and only a small part of the income, and if the substantial work done by the trust is charitable in nature and...

Lease Charges Paid By The Railways Department Not Subjected To Levy Of VAT: Chhattisgarh High Court

The Chhattisgarh High Court has held that the lease charges paid by the Railways Department are not subject to the levy of value-added tax (VAT).The single bench of Justice P. Sam Koshy has observed that the right to use goods or the use of goods is not the relevant factor to justify the levy of taxes.The Indian Railways had floated a Scheme known as the "Own Your Wagon Scheme" to which the Petitioner Company expressed their interest in purchasing Wagons and for which a necessary proposal was...

18% GST Is Payable On Work Contract Service Of Constructing Warehouse And Cold Storage Godown: AAR

The Telangana Authority of Advance Ruling (AAR) has ruled that 18% GST is payable on work contract services for constructing warehouses and cold storage godowns for Telangana State Industrial Infrastructure Corporation Limited (TSIICL), which will rent out the facilities.The two-member bench of S.V. Kasi Visweswara Rao and Sahil Inamdar has observed that TSIICL is a government entity. However, the original notification No. 11/2017 applied a concessional rate of tax to government entities and...

Postal Authorities To Set Up, Operate, Maintain PBE Automated System For Filing Electronic Declaration For Export Of Goods: CBIC

The Central Board of Indirect Taxes and Customs (CBIC) has notified the Postal Export (Electronic Declaration and Processing) Regulations, 2022.The postal authorities shall set up, operate, and maintain the Postal Bill of Export (PBE) Automated System for the filing of electronic declarations for the export of goods through the post.An exporter who wishes to export goods through the postal service or through his authorised agent shall register himself on the PBE Automated System. The PBE...

Gujarat High Court Releases Bank Account From Attachment Of Subsidiary Of Taiwan Company Subject To The Personal Undertaking Of The Directors

The Gujarat High Court has directed the department to release the bank account from the attachment of the subsidiary of the Taiwan Company subject to the personal undertakings of the directors.The division bench of Justice Sonia Gokani and Justice Mauna M. Bhatt, in order to secure the revenue's interest, has directed the department to continue the attachment of FD with DBS amounting to Rs. 2.65 crores.The petitioner/assessee is in the business of manufacturing injection moulding machines. It is...

Tax Cases Weekly Round-Up: 04 December To 10 December 2022

Supreme Court Concessional Rate Of Sales Tax Not Applicable On Oxygen As It Is Not A Raw Material For Manufacture Of Steel: Supreme Court Case Title: State of Jharkhand and others Versus Linde India Limited and Another The Supreme Court has held that the main function of oxygen in manufacturing steel is to reduce the carbon content; therefore, it can be considered a refining agent but not a raw material, so the concessional rate of sales tax is not available on oxygen. The...

Non-Scheduled Bank Required To Tax The Interest On Sticky Loans Or NPAs On Receipt Basis: Himachal Pradesh High Court

The Himachal Pradesh High Court has held that the non-scheduled bank was required to tax the interest on the sticky loans and non-performing assets (NPAs) on a receipt basis.The division bench of Justice Sabina and Justice Sushil Kukreja has observed that an amendment to Section 43D by Finance Act, 2017 was made by which the scope of section 43D to Co-operative Banks was extended. Although the amendment was sought to take effect on April 1, 2018, it was likely to be treated as retrospective in...

Attachment By Tax Dept. Subsequent To A Mortgage Favouring Secured Creditors Has No Legs: Madras High Court

The Madras High Court has held that the orders of attachment passed by the Tax Recovery Officer or Income Tax Department were subsequent to the mortgage created in favour of the secured creditors and have no legs.The division bench of Justice R. Mahadevan and Justice Mohammed Shaffiq has observed that even if recovery proceedings are quashed for any reason, the bankers' and financial institutions' rights to claim priority in terms of Section 31 B of the Recovery of Debts and Bankruptcy Act and...