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Home e-Newsletters Index Year 2021 November Day 17 - Wednesday

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TMI Tax Updates - e-Newsletter
November 17, 2021

Case Laws in this Newsletter:

GST Income Tax Benami Property Customs Securities / SEBI Insolvency & Bankruptcy Service Tax Central Excise CST, VAT & Sales Tax Indian Laws



Highlights / Catch Notes

    GST

  • Levy of penalty u/s 122(1)(ii) of TN-GST and C-GST Acts - offence of issuing invoice without supply of goods - The Impugned order made by second respondent are set aside solely on the ground that alleged misuse of writ petitioner's Aadhar and PAN Cards and obtaining of fraudulent registration is under investigation - Rights of the revenue and petitioner preserved - HC

  • Revocation of cancellation of registration of petitioner - rejection of registration without fixing any date or time for hearing and without waiting for any reply from the petitioner - There is no consideration of the proviso to sub-section (2) of Section 30 of the Act in the appellate order. - The subsequent order, rejecting the application for revocation of cancellation, of the authority is questionable - Order set aside for fresh consideration - HC

  • Seeking grant of Bail - active role in commission of crime under Section 132 of CGST Act - A disregard for the interest of the community can be manifested only at the cost of forfeiting the trust and faith of the community in the system to administer justice in an even handed manner without fear of criticism from the quarters which view white collar crimes with a permissive eye unmindful of the damage done to the national economy and national interest. - if accused is released on bail then there are likely chances of him to jump bail - Bail application rejected - DSC

  • Income Tax

  • Additional Depreciation on increased cost - Adjustments u/s 43A - exchange rate fluctuation - the increase or decrease in liability should be taken into account to modify the figure of actual cost and secondly that such adjustment should be made in the year in which the increase or decrease in liability arises on account of the fluctuation in the rate of exchange - Claim allowed - HC

  • Computation of annual value under section 23 - The amount determined by the Assessing Officer is less than the monthly rental agreed between the parties for the property in question originally. Moreover, these are the journal entries, no actual payments have been made by the assessee. The loan liability converted into interest free security deposit as contended by the assesse cannot be acceded to. On the other hand, the interest free security deposit disproportionate to the monthly rent is nothing but a device to circumvent the liability to tax. - HC

  • Validity of Assessment u/s 153C - Addition on account of forfeited amount of customers. - Assuming that there is a substantial time gap between the date of advance received and date of cancellation of the bookings, this fact may raise a strong presumption on cessation of liability, but even this presumption cannot justify the assessment u/s 153C of the Act which has to be based upon incriminating material found at the time of search - AT

  • Correct head of income - the major source of income for the assessee is rental income. The assessee obtained long-term lease of the property and sub-leased the same in a regular systematic manner with a view to earn rental income from such activities in a business-like manner. The perusal of financial statements would show that the assessee had obtained loans to procure the properties and business investments were mostly in the nature of various properties - Income is taxable as Business income - AT

  • TDS u/s 195 - Disallowance invoking section 40(a) on account of Foster’s Brand - said amount was capitalized by the assessee in the books under Fixed Assets and depreciation on the same was claimed @ of 25% under section 32(1) - following the earlier decisions, no additions can be made - CIT(A) has rightly deleted the additions. - AT

  • Reopening of assessment u/s 147 - bogus purchases - AO having not carried out the scrutiny assessment within the prescribed statutory limit, cannot be given another innings for no fault of the assessee and therefore in the facts and circumstances of the case, we are of the considered opinion that ‘reason to believe’ which is the jurisdictional precondition to reopen the assessment as required by the law has not met in the reasons recorded in the instant case and therefore the action of the AO to reopen the assessment is null in the eyes of law - AT

  • Disallowing the expenses on the reasoning that corresponding income was not offered to tax - matching principles of the accounting treatment - part of the activity of the project which has been completed after incurring such expenses, the same should be classified as work-in progress and the same should not be claimed as deduction in pursuance to the principles of matching concept. - However, the assessee should be allowed deduction on the enhanced income on account of the disallowance of the expenses as discussed above. - AT

  • Validity of reopening of assessment - service of notice - Since no one was on behalf of the assessee was available at the given address, therefore, notice was served by affixture according to the provision of sub-section (1) of section 282 of the Income Tax Act, 1961. In the light of the above facts and findings, we do not find any infirmity on this issue in the order of ld. CIT(A) that Assessing Officer has served the notice by affixture on the last known address of the assessee. - AT

  • Addition on account of depreciation, interest and running expenses for the vehicle registered in the name of the director - Dominion ownership of the car rest with the company. The company being a body corporate is different from the individuals. In other words in a body corporate there cannot be any element of personal expenses as alleged by the AO. - AT

  • TDS u/s 195 - disallowance of design expenses u/s.40(a)(i) - it seems that the amount paid by the assessee to the foreign party as fee for technical services is subject to tax in India despite the fact such foreign party does not have any permanent establishment in India. However we find that such explanation whether the services rendered in India or not was brought in the statute by the Finance Act 2010. The financial year before us is 2008-09 and at that relevant point of time such explanation was not available. Admittedly, the services were not rendered by the foreign party in India. Thus, for the purpose of TDS the provisions which are applicable for the relevant year has to be seen. - AT

  • Disallowance of bad debts as claimed u/s 36(1)(viia) - deduction claimed @10% of aggregate average advances - AO is directed to make relevant enquires and verifications , including , inter-alia, making enquiries from RBI to seek relevant information to arrive at decision whether the assessee will be eligible for deduction u/s 36(1)(viia). Thus , if it is found by AO after due verifications and enquiries that the assessee was granted banking license by RBI which covers relevant previous year 2009-10, then in our view the assessee will be eligible for deduction u/s 36(1)(viia) under both the limbs. - AT

  • Addition under section 41(1) - Scope of abated assessment - Onus to prove - Even before the Bench, the ld Counsel fails to submit the basic document, bank statement, therefore it is not possible for the Bench to find the fact that whether payment has been made by account payee cheques or non-account payee cheques. The ld Counsel also argues that in assessment year 2011-12, the assessing officer cannot make addition without the aid of incriminating material. We note that assessment year 2011-12 is an abated assessment where assessing officer can do regular scrutiny, hence plea raised by the ld Counsel is not acceptable. - AT

  • Customs

  • Rejection of request for conversion of free shipping bills to drawback shipping bills - one of the reason for rejection is that the documents at the time of exports are not available - The ARE-1 document would show that the goods have been removed from the factory for export after it has been examined / verified by the Superintendent of Central Excise - the rejection of request on the ground that appellants did not furnish documents is factually and legally untenable. - a period of three years would be a reasonable time for filing an application under section 149. - AT

  • Indian Laws

  • Enforcement of a foreign Arbitral Award - This court is unable to accept the contention of the respondent that the enforcement of the Award should be refused on the grounds urged. In successfully surmounting the grounds for refusing enforcement, the Award is held to be a binding Award and the court is satisfied that the Foreign Award is enforceable under Sections 46, 47 and 49 of the Act. The Award should hence be enforced in accordance with the enabling provisions under Part II of the Act - HC

  • Waiver off of fully cash handling charges collected from the stamp vendors by the Bank - The Collection of cash handling charges from the stamp vendors/petitioners by the 2nd and 3rd respondents are declared as illegal and without any authority. Accordingly, the respondents 2 and 3 are directed, not to collect any cash handling charges from the stamp vendors, while depositing cash in Government accounts through Treasury Challans in any of the branches of the State Bank of India. - HC

  • Dishonor of Cheque - mismatch of signatures - This is a case where the 2nd respondent/accused has not denied the fact that he had entered into a hire purchase agreement with the appellant/complainant. He had also not denied the fact that he had failed to repay the instalments of the loan in time - The trial court on an examination of the signatures on various documents concluded that there was a similarity in the admitted signature and the signature contained in the cheque. Of course, the appellate court has by invoking Section 73 of the Evidence Act come to a different conclusion regarding the similarity in the signatures. - the appellate court went wrong in reversing the conviction and sentence imposed on the 2nd respondent/accused. - HC

  • Service Tax

  • Levy of service tax - Commercial Coaching or Training Services - conducting training courses and providing certificates to the students without the approval of UGC or AICTE - Right from beginning till 30.06.2017 the activity of the appellant in providing educational /vocational training to their students, is as per the pre defined curriculum in collaboration with the respective University, is exempt throughout,as they have provided education and training followed by issue of certificate of degree/ diploma which is recognised by law for the time being in force. Further, we find that on completion of the courses conducted by the appellants, the students/ trainees have either received employment and/or are competent to be self employed. - Demand set aside - AT

  • VAT

  • Classification of goods - Multi Function Printers - It could not be said gainsaid that this notification has to be given prospective effect. - These aspects though have been analysed by the Tribunal and benefit has been denied under this notification dated 07.07.2007, on different ground altogether, which was not the subject matter of the appeal. Hence, there are no hesitation to hold that the Tribunal has exceeded its jurisdiction in adjudicating upon other issues which were not considered by either the Assessing Authority or Appellate Authority for denying the benefit of notification - HC


Articles


Notifications


Circulars / Instructions / Orders


News


Case Laws:

  • GST

  • 2021 (11) TMI 551
  • 2021 (11) TMI 542
  • 2021 (11) TMI 541
  • Income Tax

  • 2021 (11) TMI 540
  • 2021 (11) TMI 539
  • 2021 (11) TMI 538
  • 2021 (11) TMI 537
  • 2021 (11) TMI 536
  • 2021 (11) TMI 535
  • 2021 (11) TMI 534
  • 2021 (11) TMI 533
  • 2021 (11) TMI 532
  • 2021 (11) TMI 531
  • 2021 (11) TMI 530
  • 2021 (11) TMI 529
  • 2021 (11) TMI 528
  • 2021 (11) TMI 527
  • 2021 (11) TMI 526
  • 2021 (11) TMI 525
  • 2021 (11) TMI 524
  • 2021 (11) TMI 523
  • 2021 (11) TMI 522
  • 2021 (11) TMI 521
  • 2021 (11) TMI 511
  • 2021 (11) TMI 510
  • Benami Property

  • 2021 (11) TMI 520
  • Customs

  • 2021 (11) TMI 519
  • 2021 (11) TMI 518
  • 2021 (11) TMI 517
  • Securities / SEBI

  • 2021 (11) TMI 516
  • Insolvency & Bankruptcy

  • 2021 (11) TMI 515
  • Service Tax

  • 2021 (11) TMI 514
  • Central Excise

  • 2021 (11) TMI 513
  • CST, VAT & Sales Tax

  • 2021 (11) TMI 550
  • 2021 (11) TMI 543
  • Indian Laws

  • 2021 (11) TMI 549
  • 2021 (11) TMI 548
  • 2021 (11) TMI 547
  • 2021 (11) TMI 546
  • 2021 (11) TMI 545
  • 2021 (11) TMI 544
  • 2021 (11) TMI 512
 

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