Supreme Court judgement is precedent for quaestion of law only and for an order requiring reinstatement of employee without assigning reasons
Surinder Kumar and Ors 194 ITR 434 SC
Surinder Kumar and Ors 194 ITR 434 SC
Saturday 25 August 2012
Supreme Court Judgement even if doubted by another bench to be applied unless declared bad by another bench
Johnson Lifts Ltd 10 STM 864 HC-AP
Judges found to follow decision of co-ordinate bench
If Judges do not agree with decision of coordinate bench the matter must be referred to larger bench otherwise decision of coordinate bench must be followed
1.Sunder Das Kanahaya Lal Bhatija 77 STC 347(SC)
2. Devki Ammal 212 ITR 395
1.Sunder Das Kanahaya Lal Bhatija 77 STC 347(SC)
2. Devki Ammal 212 ITR 395
Refund Harrassment-Anand Prakash Case Delhi High Court 04-05-2012
IN THE HIGH COURT OF DELHI AT NEW DELHI
W.P.(C) 2659/2012
COURT ON ITS OWN MOTION ..... Petitioner
Casual Transaction with relatives and bonafide belief -not penalty for 269SS,269T
•Casual transaction with relatives and bonafide belief and genuineness constitutes reasonable cause—no penalty. Sunil Kumar Goel 315 ITR 163 P&H
269SS,269T not applicable to book entry
Acceptance or repayment through journal entry do not attract section 269SS or 269T: Acceptance or repayment through Journal Entry would not come within the ambit of the words ‘loans or deposits’-section 269SS applies only where money passes from one person to another by way of ‘loan or deposit
Amount paid by firm to partners or vice versa- 269SS,269T not attracted
Amount paid by firm to partners or vice versa- is payment to self and does not partake the character of loan or deposits in general law. Provisions of section 269SS are not applicable to such facts( CIT v. Lokhpat Film Exchange (Cinema) [2008] 304 ITR 172 (Raj.)
S.54EC is applicable to depreciable assets also
•M/s. Jai Hind Rubber Products Vs ACIT, ITA No.2296/Mum/2011, Date of pronouncement: 03.08.2012, ITAT- Mumbai
Remuneration to Partners as per Income Tax Act
•The Asian Marketing 2nd May 2012 Rajasthan HC
•The Tribunal finding that “The quantification of the remuneration was apparent from clause 8 of the partnership deed which provided that the remuneration would be payable as per norms fixed by the Income-tax Act. The requirement in law is that remuneration should have been authorized and the amount of remuneration shall not exceed the amount specified in s. 40(b)(v) which uses the word ‘authorised‘ and not the word ‘quantify‘” is a finding of fact which cannot be interfered with by this Court.
•The same view has been taken in Durga Dass Devki Nandan 241 CTR 180 (HP) while a contrary view has been taken in Sood Brij & Associates & Madeena Constructions 134 ITD 1 (Che)(TM)
206AA not applicable to persons non assesses
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S. 206AA runs counter to s. 139A and is discriminatory. Though the Legislature’s intention is to bring maximum persons under the income-tax net, it may not insist that even persons whose income is below the taxable limit have to compulsorily obtain a PAN. If any tax avoidance is detected, that can be taken care of by penal provisions.
A. Kowsalaya Bai v UOI 5th June 2012
Writ Petitions 12780 – 12782 / 2010 (T) Karnatka High Court
• Accordingly, s.206AA is read down as being inapplicable to persons whose income is less than the taxable limit. Banks & financial institutions should not insist upon PAN from such small investors. It continues to apply to persons whose income is above the taxable limit
The provisions of section 40(a)(ia) are applicable only to the expenses payable as on 31st March of every year and cannot be invoked to disallow the amounts which have already been paid during the previous year, without deducting tax at source
Bright Enterprises Private Limited
Pranik Shipping & Services Ltd. v. Asstt. CIT [2012] 135 ITD 233/19 taxmann.com 107 (Mum.)
Underwater Services Co. [2012] 25 taxmann.com 216 (Mumbai - Trib.)
Payment for settlement of dispute for infringement of patent- motivated by pure commercial purpose – allowable
Desiccant Rotors 245 CTR 572 (Del)
Compounding Fee of Construction is not allowable as business Expense
•Mamta Enterprises 266 ITR 356 Kar
Additional Compensation and new house received for displacement from old house is not taxable
Kushal K. Bangia v. ITO(2012) 50 SOT 1 (Mum.)(Trib.)
The assessee was the member of a housing society. The housing society and it’s members entered into an agreement with a developer pursuant to which the developer demolished the building
owned by the housing society and reconstructed a new multistoried building by using the FSI
arising out of the property and the outside TDR available under Development Control
Regulations. The assessee, as a member of the housing society, received a larger flat in the new
building, displacement compensation of Rs. 6 lakhs (at Rs.34,000/- p.m. for the period of
construction of the new building) and additional compensation of Rs.11.75 lakhs. The Assessing
Officer &CIT(A) held that the said “additional compensation” was assessable as income in the
assessee’s hands. On appeal by the assessee, held allowing the appeal:
Prize Money on Coupons of Small Saving Schemes is not income
CIT v. Tilak Raj Kalra (2012) 206 Taxman 126 / 249 CTR 205/69 DTR 363(P&H.)(High Court)
The Assessee subscribed to PPF which formed part of Small Savings Scheme encouraged by
Government of Punjab. The Govt issued lucky coupon on every investment of Rs.5,000/-. The
Assessee also received lucky coupon which won the prize of 1kg gold. The Assessing officer held
that the price money won by assessee fell within the meaning of section 2(24)(ix) and made
addition as income. On Appeal, the CIT(A) as well as the Tribunal deleted the addition. On
appeal, the High Court, confirmed the view of the Tribunal and held that incentive price received
by assessee on account of coupon given on the strength of small saving certificate would not fall
within the definition of lottery and would not be included as income as per section 2(24)(ix).
The Assessee subscribed to PPF which formed part of Small Savings Scheme encouraged by
Government of Punjab. The Govt issued lucky coupon on every investment of Rs.5,000/-. The
Assessee also received lucky coupon which won the prize of 1kg gold. The Assessing officer held
that the price money won by assessee fell within the meaning of section 2(24)(ix) and made
addition as income. On Appeal, the CIT(A) as well as the Tribunal deleted the addition. On
appeal, the High Court, confirmed the view of the Tribunal and held that incentive price received
by assessee on account of coupon given on the strength of small saving certificate would not fall
within the definition of lottery and would not be included as income as per section 2(24)(ix).
Coaching Classes by university or other distance education held not charitable u/s 2(15)
Dy. DIT v. Kuttukaran Foundation (2012) 51 SOT 175 ( Cochin) (Trib.)
A mere coaching class for preparing the students to attend the examination conducted by open university or by the other university or distance education cannot be considered to be regular and systematic schooling within the meaning of Section 2(15). For the purpose of section 2(15), the assessee has to necessarily conduct a regular school/ college in which the students are imparted education, knowledge, training which result in of degree or diploma by government or government agency or university. Activity of coaching classes cannot be considered as Charitable activity within the meaning of section 2(15), therefore the assessee is not entitled to exemption under section 11.
A mere coaching class for preparing the students to attend the examination conducted by open university or by the other university or distance education cannot be considered to be regular and systematic schooling within the meaning of Section 2(15). For the purpose of section 2(15), the assessee has to necessarily conduct a regular school/ college in which the students are imparted education, knowledge, training which result in of degree or diploma by government or government agency or university. Activity of coaching classes cannot be considered as Charitable activity within the meaning of section 2(15), therefore the assessee is not entitled to exemption under section 11.
Publication of books on audit etc by ICAI is charitable activity
DIT v. The Chartered Accountants Study Circle ( 2012) 70 DTR 219( Mad.) (High Court)
On appeal by revenue the Court up held the order of Tribunal and held that activities of the assessee trust in publishing and selling books of professional interest which are meant to be used as reference material by general public as well as the professional in respect of bank audit, tax audit etc. cannot be construed as commercial activities and therefore, assessee trust formed with the object inter alia to conduct periodical meetings on professional subjects is entitled to approval under section 80G (5).
On appeal by revenue the Court up held the order of Tribunal and held that activities of the assessee trust in publishing and selling books of professional interest which are meant to be used as reference material by general public as well as the professional in respect of bank audit, tax audit etc. cannot be construed as commercial activities and therefore, assessee trust formed with the object inter alia to conduct periodical meetings on professional subjects is entitled to approval under section 80G (5).
INADMISSIBILITY OF EXPENSES INCURRED IN PROVIDING FREEBEES TO MEDICAL PRACTITIONER BY PHARMACEUTICAL AND ALLIED HEALTH SECTOR INDUSTRY
CIRCULAR NO. 5/2012 [F. NO. 225/142/2012-ITA.II], DATED 1-8-2012
It has been brought to the notice of the Board that some pharmaceutical and allied health sector Industries are providing freebees (freebies) to medical practitioners and their professional associations in violation of the regulations issued by Medical Council of India (the 'Council') which is a regulatory body constituted under the Medical Council Act, 1956.
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