Held by AP HC in Y. Brahmiah (5.814) 52 TMC 169 that CIT has power to enhance income but he can do so only after issuing show cause notice u/s 251 (2)

Held by Bombay HC in Ramesh Babu Lal Shah (23.07.14) 53 TMC 277, where assessee entered into agreement for purchase of land later sold by seller to some other person for development and amount received by assessee in consent degree of court is business receipt if disputed transaction was adventure in nature of trade.

Held by SC in Hotel Blue Moon 321 ITR 362 no assessment u/s 158 BC without complying 143(2).

Held by Gujrat High Court in Sukhini P. Modi (10.3.14) 52 TMC 50 that reassessment notice issued without issuing 143(2) notice is void

Held by Allahabad HC in Sumati Television P Ltd (23.09.2014) 53 TMC 281, advance received for warranty services to be rendered in second year could not held as income on receipt basis.

Test for substantial question of law to be entertained by HC laid down by SC in Sir Chuni lal Mehta vs. Centuary Spinning AIR 1962 SC 314 . Tests are i) Whether directly or indirectly affects substantial rights of parties ii) Question is of general public importance iii) whether it is an open question not settled by pronouncement of SC/PC iv)Issue not free from difficulty v) Calls for discussion for alternative view

Held by Karnatka High Court in Estate Sheriff Centre (23.06.14) 51 TMC 525, ITAT could not set aside penalty levied by IT authorities without pointing out any reasons

SLP of assessee rejected by SC on 10.11.14 against decision of Karnataka high court in M.J Siwani holding that no sec.54f relief even if assessee is only joint owner of more than one house on date of sale of asset

Held by SC in Sugali Sugar (Para 10) mere expiry of limitation period would not extinguish the debt but would only prevent creditors from enforcing [Bombay dyeing & Mfg Co Ltd 1958 SCR 1122 referred]

Held by Supreme Court in Sugali Sugar Works (P) Ltd 236ITR518 that the assessee transferred certain sums representing advances and deposit out of suspense account to capital reserve. Unilateral act on part of debtors shall not bring it in purview of section 41. Bombay High Court in J.K Chemicals 62 ITR 34 quoted

Held by Andhra HC in Sri Kamakshi Food Products 367 ITR 184 where debts written off on ground of being not tracable or being time barred not refiected in income penalty is impossible

Held by Andhra Pradesh high court in Sri Kamakshi Food Products (d) ltd (2-7-14) 52 TMC 57; 367 ITR 184 no penalty if no ,malafide intention in not disclosing interest liability written off by bank

Held by Karnatka High Court in Manjunatha Cotton & Ginning Factory (13.12.12) 35 TMC 250 -Imposition of penalty even if tax liability is admitted is not automatic -explanation though offered but not substantiated is found to be bonafide and all facts material to computation of income have been disclosed,no penalty to be imposed -notice u/s 274 should specifically state the grounds whether concealment or furnishing inaccurable particulars -Sending printed forms setting all grounds of section 271 would not satisfy requirement of law -Finding in assessment proceeding would not operate as resjudicata in penalty proceedings

Held by Karnatka High Court in Steel Centre (3.6.14) 51 TMC 127 ,where assessee was successful in getting confirmation letters from everyone merely because it could not produce some of creditors penalty could not be levied

Held by Uttrakhand HC in Deep Kukreti, where penalty was initiated on breach of understanding the assessee interest could be said to be jeopardized but after dropping of penalty proceeding assessee is no longer aggrieved

Held by Supreme court in Bhau Ram v/s Baij nath singh AIR 1961 1327, in absence of legal provision or principle of equity no one can be deprived of legal sight to appeal. ( Para 17 of Deep Kukreti)

Held by Punjab and Haryana High Court in Chhat Mull Aggarwal 116 ITR 694, where assessee earlier accepted addition of Rs.15000 to the cost of construction and AO added it to the income of year. Later assessee stated that cost which he agreed pertains to later period. Appeal allowed by AAC. Held by ITAT that without rectification application before AAC explaining the circumstances which led the assessee to give consent to application the appeal before AAC was incompetent Held by High Court that where admission of assessee is wrongly recorded under assessment order, it is open for assessee to file rectification or to avail remedy of appeal. Assessee even need not file an affidant where there are sufficient circumstances on file to come to conclusion that admission made by assessee was not binding on him.- Quoted in (Para 13 of Deep Kukreti)

Held by Allahabad High Court in Gauri Sahai Ghisa Ram (1979)120 ITR 338 that where firm was filing return for Dusshera to Dusshera; One partner died, Succeeding firm adopted Financial year. Assessment framed for complete period. Later court held that different assessment to be framed for pre and post death period Assesee allowed to change its stand -stated in (Para 11 of Deep Kukreti)

Held by Bombay High Court in Ramesh Chandrad & CO. 168 ITR 375;where assessee makes a statement of fact, he can have no grievances and if he can have no grievance, he can file no appeal. Further held If assessee,case is that his statement has been wrongly recorded or recorded under mistaken belief , he should make an application for rectification to the authority which passed order

Where cost of machine worked out on basis of experts report to which one partner had consented Allahabad High Court held that no appeal against order of AO can be made to CIT [ Sterling Machine Tools (All) 123 ITR 181 - followed in Para 9 of Deep Kukreti

The assessee consented in writing to reduced cost of acq. From rs. 2,70,000 per bigha to rs.6000/- per bigha in computation of capital gain. Held that assessee having consented is not aggrieved and can no later contest cost of acquisition in appeal. -Deep kukreti (Uttrakhand) 19.8.14 53 TMC 161

Punjab and Haryana High Court laying down principles of assessment in the case of Contractors in the case of TELELINKS &MATTEWAL CO-OP L/C SOCIETY (P&H) 20-11-14

In ITA 269/2014 AO rejecting a/c books-[Telelinking v/S CIT Bathinda] applied 12% rate in case of contractor applying Prabhat Kumar 323 17R 675 (P&H) and ITAT Chd in ESS Buildings [ITA 707/1997] CIT(A) reduced to 6% ITAT restored to 12%

Wisdom of court below has to yield to higher wisdom -Tej International (Del)Trib 69TTJ650 .Held by Bombay high court that this position is not altered even if judgement of higher judicial forum is from non jurisdictional High court Godavari Devi Saraf (1978) 113 ITR 589 (BOM)- Followed in BIG BAGS INTERNATIONAL (PARA 19)

40(a) (ia) Ist Proviso amended by FA 2010 permitting allowance of exp for TDS payment till due date u/s 139 has retrospective effect.Virgin creations (KOI- TRIB). However Bharti Shipyard (SB) (OM) says it is prospective. Calcutta High Court in Virgin Creation on 23.11.11 in ITA 302/2011 has approved KOI –Trib decision Karnatka High Court in Santosh Kumar Shelly [497 tmc 47 (kar)] has also taken same view as in Virgin Creation. Hence 40 (a) (ia) is retrospective w.e.f 01-04-05 -BIG BAGS INTERNATIONAL (Bang Trib)

Writing off export proceeds with out obtaining RBI approval is allowed. RBI directions can not override conditions of 36 (1) (vii) rws 36 (2) Sabra impex (Mum) & ACE designers (Bang) followed in BIG BAGS INTERNATIONAL (P) ltd (BANGLORE TRIB) 21.8.14

Unabsorbed depreciation can be set off against profits taxable u/s 41(2) for sale of business assets even if business is discontinued- Karnataka Instrade Corporation Ltd. [2015] 62 taxmann.com 239 (Karnataka) 09-10-2015

Section 32(2) at the time decision on the subject was delivered by SC in Vermani Industries 216 ITR 607 was similar to provisions as exist post amendmend w.e.f AY 2002-03 [Para 9 of Vermani Industries].It was held by apex court overruling Madras High Court in East Asiatic  in Para 13 of its Judgement that :

1.       Since section 72(1) specifically required same business to be continued, for setting of loss and since there is no similar provision there in 32(2), there is no requirement that same business be continued for setting off unabsorbed depreciation

2.       Also held that there is no requirement that same asset(s) on which unabsorbed depreciation is sought to be allowed as deduction should continue.

3.       Regarding continuance of business , supreme court held that two views are possible in so far as 32(2) says that unabsorbed depreciation to be added to depreciation allowance for the year. However , since 32(2) also says that if there is no depreciation allowance for the year, unabsorbed depreciation shall be deemed to be deprecation allowance for the year, hence there is no requirement for continuance of business.

Further it was held by SC in Jaipuria China Clay Mines (P) Ltd 59 ITR 555 [Para 7] that words “profits or gains” used in 32(2) are different from” profits or gains of business or profession”, hence there is no requirement for continuance of business u/s 32(2)

Karnatka High Court in Karnataka Instrade Corporation Ltd. [2015] 62 taxmann.com 239 (Karnataka) 09-10-2015,hence following supreme court Judgements and its own judgement in Kapila Textiles 129 ITR 458, held that unabsorbed depreciation to be allowed against profits arising from sale of building, plant and machinery taxable u/s 41(2)