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Home e-Newsletters Index Year 2020 March Day 18 - Wednesday

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TMI Tax Updates - e-Newsletter
March 18, 2020

Case Laws in this Newsletter:

Income Tax Customs Corporate Laws Service Tax Central Excise



Articles


News


Notifications


Circulars / Instructions / Orders


Highlights / Catch Notes

    Income Tax

  • Validity of Section 40(a)(iib) - Scope of the term "Charges" - Whether Value Added Tax (VAT) would be falling within the definition of a “charge” - petitioner Corporation contending that the amount which is deductible in computing the income chargeable in terms of the Income Tax Act is not being allowed under the garb of the aforesaid provision - as the matter is still sub judice before the Income Tax Authority, we are not inclined to entertain the writ petition - HC

  • Application filed before the Settlement Commission - Settlement Commission passed the impugned order though there was no true and full disclosure by the assessee in the application for settlement filed before the Commission - The difference is very marginal as compared to the disclosure made by the assessee - Petition by revenue dismissed - HC

  • Income accrued in India - For the purpose of applying Article 13(5) of the India-Belgium tax treaty two fold conditions are required to be cumulatively satisfied viz. (i). that, the transfer of shares should represent participation of at least 10% in the capital stock of company; and (ii). that, the company whose shares are transferred should be a resident of a contracting state - Unilateral amendment made available in the I.T Act as ‘Explanation 5’ to Sec. 9(1)(i) of the Act, cannot be read into the India-Belgium tax treaty. - AT

  • Assessment u/s 153A - claim of deduction under section 80IA(4) - Paper company or not - assessee as a SPV was a mandatory requirement of NHAI - four laning of the existing road - to be considered as a new infrastructure facility or not - AO directed to verify the correctness of assessee's computation of deduction u/s 80IA and allow the same. Further, to ensure that deduction for the same infrastructure facility is not allowed to both the assessee and Gil, the Assessing Officer is directed to verify the relevant facts and thereafter compute deduction u/s 80IA. - AT

  • Deduction u/s 80P - CIT(A) has allocated the whole of the interest expenditure over the interest on FDRs and to the extent of interest attributable to FDRs placed with JCCB, the same has been reduced while working out the net interest income eligible for deduction u/s 80P(2)(d) of the Act. - In case, there are no liquid funds and all the funds are deployed in fixed and current assets, then the said theory of interest free funds doesn’t support the case of the assessee. - AT

  • Disallowance of higher reduction of depreciation on the cost of civil engineering works for laying foundation of solar power panels - the expenditure which is incurred by the assessee in the process of installation of solar panels is for the purpose of solar power plant. Thus the cost of said work cannot be separated from the installation of solar power plant and entire cost of solar power plant is eligible for depreciation as applicable for plant and machinery. - AT

  • Exemption u/s 11 - charitable activity or not - running a crime investigating agency parallel to the investigative agencies of the state and central government. - above object cannot be called as charitable in nature - The Learned CIT(E) has also pointed out following inconsistencies or discrepancies in the accounts and the activities of the assessee - Applications u/s 12AA and 80G were rightly rejected - AT

  • Revision u/s 263 - Default in computation of amount eligible for deduction u/s 80IA - The AO has passed the assessment order after calling for details on the issue and after considering the reply and documents after verification of the same and after due application of mind passed the assessment order, so it cannot be termed as erroneous and prejudicial to the interest of the revenue. - AT

  • Exemption u/s 11 - sections 11 and 12 are substantive provisions which provide for exemptions to a religious or charitable trust. Sections 12A and 12AA detail the procedural requirements - denying such benefit to a trust like the assessee who had obtained registration u/s 12AA during the pendency of the appeals filed against the orders of the assessing authority, by narrowly interpreting the term, 'pending before the assessing officer' so as to exclude its pendency before the appellate authority, will be doing violence to the provisions of the Statute and, as such, liable to be interfered with. - AT

  • Revision u/s 263 - Unexplained cash deposits - A lack of inquiry on a pertinent point which demonstrates possible revenue leakage of staggering amount would definitely tantamount to the order being both erroneous as well as prejudicial to the interest of the Revenue. Consequent upon the action of Pr.CIT, the assessment order is merely cancelled and set aside to the file of the AO for making relevant inquirie - revision sustained - AT

  • Transfer of cases u/s 127 - assessee submitted that the AO had no jurisdiction to complete the assessment in Kolkata, since the jurisdiction over the assessee was duly transferred u/s 127 to chennai - Even a ‘right’ decision by a ‘wrong’ forum is no decision. It is non-existent in the eye of law. And hence a nullity. The assessment order under appeal is therefore no order in the eye of law, hence we quash the assessment order. - AT

  • Addition on account of difference in Arm’s Length Price - As far as rate of custom duty is concerned, it can be easily taken from the official website of the European Union and we find that the rate at the relevant point of time was 4.5% whereas the custom duty paid by the assessee accounts for more than 75% of the purchase value and 50% of the total cost of goods sold. In our considered opinion, such difference on account of custom duty paid by the assessee and that existing in the location where comparable companies operate, cannot be ignored. - AT

  • Assessment of trust - Exemption u/s 11 - The expenditure, if incurred in an earlier year is adjusted against the income of a later year, it has to be held that the trust had incurred expenditure on religious and charitable purposes from the income of the subsequent year, even though the actual expenditure was in the earlier years, if in the books of account of the trust such earlier expenditure had been set off against the income of the subsequent year. - AT

  • Depreciation on Car - if the payment has been made by the assessee then the assessee shall be the owner of the vehicle despite the fact it was registered in the name of 3rd person who is closely connected with the assessee - AT

  • Customs

  • Bonafide baggage or not - the benefit of free allowance of ₹ 50,000/- under the Baggage Rules has been wrongly extended by the adjudicating authority to the applicant since drones and their accessories cannot be cleared as “baggage”. - CGOVT

  • Refund claim - reassessment of bills of entry - Since the appellants have not challenged the assessment within the prescribed period and also for the reason that the goods were not available for testing as to whether they are manufactured from plastic scrap or plastic waste, the authorities below have rightly rejected the belated request for reassessment - AT

  • Exemption from countervailing duty (CVD) - where the exemption Notification stipulates two conditions, namely that the inputs should have suffered duty and that no CENVAT credit should have been availed, then the benefit of the Notification will be available only if both conditions are satisfied. An importer will never be able to satisfy both these conditions and hence, he cannot claim the benefit. - AT

  • Diversion of imported goods - violation of N/N. 21/2002-Cus. - Therefore, the only for the reason that the goods were transferred to their Baddi Unit, the exemption could not be denied subject to verification that the said transferred goods have been used in the Baddi Unit. - AT


Case Laws:

  • Income Tax

  • 2020 (3) TMI 639
  • 2020 (3) TMI 638
  • 2020 (3) TMI 637
  • 2020 (3) TMI 636
  • 2020 (3) TMI 634
  • 2020 (3) TMI 633
  • 2020 (3) TMI 632
  • 2020 (3) TMI 631
  • 2020 (3) TMI 630
  • 2020 (3) TMI 629
  • 2020 (3) TMI 628
  • 2020 (3) TMI 627
  • 2020 (3) TMI 626
  • 2020 (3) TMI 625
  • 2020 (3) TMI 623
  • 2020 (3) TMI 622
  • 2020 (3) TMI 621
  • 2020 (3) TMI 620
  • 2020 (3) TMI 619
  • Customs

  • 2020 (3) TMI 652
  • 2020 (3) TMI 651
  • 2020 (3) TMI 650
  • 2020 (3) TMI 649
  • 2020 (3) TMI 648
  • 2020 (3) TMI 647
  • 2020 (3) TMI 646
  • 2020 (3) TMI 645
  • 2020 (3) TMI 644
  • 2020 (3) TMI 643
  • Corporate Laws

  • 2020 (3) TMI 642
  • Service Tax

  • 2020 (3) TMI 635
  • 2020 (3) TMI 624
  • Central Excise

  • 2020 (3) TMI 641
  • 2020 (3) TMI 640
 

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