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INCOME TAX APPELLATE TRIBUNAL ORDER 2011

2011-TIOL-492-ITAT -AHM

Shri Sanjay S Shah Vs DCIT, Ahmedabad (Dated: June 17, 2011)

Income tax – Sections 143(3), 271(1)(c) – Whether when assessee fails to receive TDS certificates on interest income from banks in time but decides neither to declare the income in his return nor to take credit for the TDS on the basis of duplicates collected, penalty u/s 271(1)(c) is warranted in such a case.

Also see analysis of the Order

2011-TIOL-491-ITAT -DEL

M/s Wasim Industries Vs ACIT, New Delhi (Dated: May 6, 2011)

Income Tax - Sections 4, 143(2) - Whether when the firm produces evidence that its name was fraudulently used for carrying out undisclosed transactions, addition can be made even under such circumstances - Whether belated plea of non-service of Sec 143(2) notice can be taken before the ITAT in second round of litigation without the support of any affidavit.


M/s Sonia Arora Vs ACIT, New Delhi (Dated: March 11, 2011)

Income tax – Capital Gain or Business Income – Section 54 – Whether the profit on sale of three floors out of five floors constructed can be treated as business profit or capital gain when the intention of the assessee is to make investment and it is not engaged in the business of building construction even prior to the date of investment or after the date of sale of these three floors – Whether it can be treated as an adventure but could not be considered in the nature of trade – Whether the assessee is entitled to deduction u/s 54 on the profit received on sale of the three flats for the amount invested in the construction of the first and third floor.

2011-TIOL-489-ITAT -MUM

DCIT, Mumbai Vs M/s Sumer Ville Investments (Dated: June 17, 2011)

Income tax – Section 23(1)(a) - Suppression of Sale – Whether the notional interest on interest-free deposit from tenants is to be considered while determining the correct ALV u/s 23(1)(a) – Whether when no independent enquiry is made by the AO from the purchasers of the property, the sale consideration of property cannot be rejected merely on the basis that in past the sales were made at higher price and particularly

when the sale price was accepted by the stamp duty authorities for the purpose of stamp duty valuation.

2011-TIOL-488-ITAT -BANG

Asera Software (India) Pvt Ltd Vs ACIT, Bangalore (Dated: February 11, 2011

Income Tax - Section 37 - Whether expenses incurred on account of premature vacation of leased premises are revenue in nature - Whether expenses incurred on construction of temporary structures of leased premises are business expenditure.


ITO, New Delhi Vs M/s Tropicana Beverages Company (Dated: June 17, 2011)

Income Tax - Section 32 – Whether depreciation can be allowed even if the machinery is not put to use.


Society For The Small & Medium Exporters Vs DIT, Delhi (Dated: April 29, 2011)

Income Tax - Sections 2(15), 12A - Whether, for the purpose of seeking registration as a charitable body, it is enough if the assessee organises exhibitions for promotion of sales of products of its members - Whether benefits of Ss 12A and 80G can be allowed even if there is no charitable acitivity and the assessee undertakes only commercial activity.


DCIT, Mumbai Vs M/s BDA Ltd (Dated: April 29, 2011)

Income Tax - Section 23 - Whether there can be any addition when rent actually received is higher than the standard rent determined by the municipal authorities.


ITO, Mumbai Vs Yash Container Terminal P Ltd (Dated: April 6, 2011)

Income Tax - Sections 133A, 194C, 194I, 201(1), Circular No 275 of 1995 - Whether the activity of transportation of containers falls under the purview of provisions of Sec 194C - Whether when the payee has paid tax on an income on which payer fails to deduct tax at source, no liability arises against the payer u/s 201(1).


The Hindoostan Spinning And Weaving Mills Ltd Vs DCIT, Mumbai (Dated: May 13, 2011)

Income tax – Sections 2(47)(iv), 45(2), 269UL(3) - Whether when an agreement is signed for development of a commercial and residential project, and the assessee converts the land into stock -in-trade as per the special resolution passed, provisions of Sec 45(2) get attracted to the consideration received by the assessee - Whether any addition is warranted for the consideration received although the property is not transferred to the developer.


M/s Regent Granito India Ltd Vs ACIT, Ahmedabad (Dated: June 17, 2011)

Income tax – Sections 36(1)(vii), 37 – Whether disallowance can be sustained for the discount offered against defective materials supplied - Whether once the assessee had written off the amount receivable from the customer as bad debts in its books of account no disallowance can be made as the assessee could not establish that the debts have become bad.


ITO, Ahmedabad Vs Gay Loard Industries Ltd (Dated: June 17, 2011)

Income Tax - Section 68 - Whether additions u/s 68 can be made merely because the affidavits filed by share subscribers were not attested by first class magistrate.

2011-TIOL-480-ITAT -RAJKOT

ACIT, Gandhidham Vs Ankur Chem Food Products (Guj) Ltd (Dated: May 13, 2011)

Income Tax: - Sections 28, 40A(2)(b) - Whether, even without any physical verification, additions can be made for discrepancies in the stock register.

2011-TIOL-479-ITAT -MAD-TM

ACIT, Chennai Vs M/s West Asia Maritime Ltd (Dated: July 1, 2011)

Income Tax – Sections 115VD, 115VG - Whether, for the purpose of claiming the benefit of tonnage tax scheme under Chapter XII-C of the Act, the ship should always do its voyage between international ports – Whether the ship operated by the assessee company cannot be termed as a qualifying ship u/s 115VD on the ground that the ship operated by the assessee is rendering the same services which could be provided on land also – Whether the ship transporting thermal coal from one location to another within the country, is a qualifying ship u/s 115VD of the Act.



ACIT, New Delhi Vs Oxford Softeck Pvt Ltd (Dated: April 28, 2011)

Income Tax - Section 2(22)(e) - Whether when assessee company makes advances in favour of its Director holding 90% stake in the company, such loans are to be treated as deemed dividend in the hands of the company or the Director.


M/s Bhoruka Engineering Inds Ltd Vs DCIT, Bangalore (Dated: February 22, 2011)

Income Tax - Sections 10(38), 45 - Whether the de-facto ownership would override the de-jure ownership - Whether the transactions of sale of shares of a closely held company can be construed as transfer of land and short term capital gain is chargeable.


Karntaka Power Transmission Corporation Ltd Vs DCIT, Bangalore (Dated: May 31, 2011)

Income tax – Section 115WB(1), Circular No 8 of 2005 – Whether the expenditure incurred on repair and maintenance of residential quarters of the staff which were owned by the assessee company can be treated as a benefit given to the employees and is covered under clause (E) of subsection (2) of section 115WB relating to employees' welfare – Whether the Board circular which provides that even the indirect expenditure which benefit employees' welfare is covered under FBT is not applicable as the expenditure incurred by the assessee to upkeep its assets doesn't mean even remotely that the benefits were provided to employees either directly or indirectly.


M/s Sanyo LSI Technology India Private Ltd Vs DCIT, Bangalore (Dated: May 13, 2011)

Income Tax - Section 10A - Whether gain on account of fluctuation in foreign exchange is eligible for deduction u/s 10A when the same is directly linked with the exports.

2011-TIOL-474-ITAT -KOL-TM

DCIT, Kolkata Vs Sushma Devi Agarwal (Dated: July 18, 2011)

Income Tax – Sections 132,139(1), 153A, 271(1)(c) – Whether when assessee declares higher profits in its revised return filed after detection of concealment, penalty u/s 271(1)(c) is warranted.



M/s Saraf Chemicals Ltd Vs DCIT, Mumbai (Dated: June 30, 2011)

Income Tax - Section 37 - Non-compete Fee - Whether trade mark is inseparable from business and hence when the entire business is taken over as a going concern the trademark alone holds no meaning - Whether when the entire business is taken over as a going concern, and a composite fee is paid for the same, the plea that the fee paid for use of trade mark is different from non-compete fee is sustainable.

Also see analysis of the case


M/s Maitri Developers Vs ITO, Mumbai (Dated: May 20, 2011)

Income Tax - Section 4, AS-7 - Whether project completion method is well recognized method as per AS-7 - Whether under project completion method entire project as a whole is to be seen and hence transfer of some flats via registration is not conclusive of the year in which the income attributable to the project is to be taxed - Whether completion certificate is also not conclusive of the fact that the pro ject was completed when the facility of drinking water shows it otherwise.


Mitsutor Shipping Agency Pvt Ltd Vs DCIT, Mumbai (Dated: April 8, 2011)

Income tax – Section 14A, 40(a)(ia). 194C, Rule 8D – Whether the disallowance can be made u/s 14A by applying rule 8D for the A.Y. prior to the A.Y. 2008-09 when the 8D was inserted – Whether the payment made by the assessee to the society as society maintenance expenses is covered under section 194C and the assessee is liable to deduct tax at source.


ACIT, Mumbai Vs M/s SKM Construction Pvt Ltd (Dated: June 30, 2011)

Income Tax- Sections 45, 28 - Head of Income - Whether mere presence of profit motive is enough to decide the head of income - Whether land which forms part of investment in balance sheets is capital asset and hence profit derived from it is taxable under the head capital gain.

2011-TIOL-469-ITAT -KOL

ITO, Kolkata Vs Millenium Writing Products Pvt Ltd (Dated: April 21, 2011)

Income Tax - Sections 2(24)(x), 36(va), 40(a)(ia), 80IB - Whether assessee is eligible for deduction u/s 80IB on the amount disallowed by AO due to delayed payment of employee's contribution of P.F and contract payments on which TDS payment was delayed.


Kodak India Ltd Vs ACIT, Mumbai (Dated: May 18, 2011)

Income Tax - Section 36(1)(xi), Circular No 779 of 1999 - Whether expenses incurred for synchronizing an old Computer system with Y-2K problem are allowable under section 36(1)(xi) particularly wh en the entire system is not discarded.


ACIT, Mumbai Vs M/s H K Impex Pvt Ltd (Dated: February 28, 2011)

Income Tax - Section 68 - Whether when the assessee successfully explains the source of share application money, the additions made u/s 68 are not sustainable -

Whether when the assessee furnishes the certificate of central excise authorities about the wastage produced in the process of manufacturing, addition made by the AO would not survive.


ITO, Mumbai Vs M/s Galaxy Saws Pvt Ltd (Dated: March 11, 2011)

Income Tax - Section 115JB - Whether in the absence of any provision mandating adjustment of an amount, credited into balance sheet directly, attributable to revaluation of capital asset, in accordance with AS-10, inclusion of such an amount in the book profit is not tenable - Whether accounts prepared in accordance with the provisions of Companies Act cannot be tinkered while computing book profit - Whether while computing book profit the AO has to rely on the authencity of audit report and he can do nothing beyond upward and downward adjustment.

2011-TIOL-465-ITAT -HYD

M/s Hyderabad Distilleries And W ineries Pvt Ltd Vs DCIT, Hyderabad (Dated: June 3, 2011)

Income tax – Section – 37 – Selling expenses – Whether selling and publicity expenses can be disallowed merely on the basis of statement of an auditor – Whether when the similar expenses were allo wed by the AO to similar parties, no disallowance can be made only on the basis of assumptions and presumptions – Whether the disallowance made without giving the assessee an opportunity to cross examine the parties on the basis of whose statement the disallowance was made, is against the natural justice.


M/s Prajna Technologies & Services Pvt Ltd Vs DCIT, Hyderabad (Dated: June 24, 2011)

Income Tax - Sections 48, 55(2)(a), 143(3), 147 - Whether when assessee gets a contract to develop specific software and transfers the same to another company for a consideration, such transfer of sale contract gives rise to capital gains - Whether right to manufacture is aking to right to carry on business.



Shri Kantilal C Shah Vs ACIT, Ahmedabad (Dated: June 24, 2011)

Income Tax - Sections 132(4), 133A, 158BC - Whether retraction of statement can be made even without any strong supporting evidence - Whether mere mention of ill health in retraction is sufficient to disprove the contents of nine month old statement - Whether there is difference between the statement recorded under 133A and 132 as the former cannot be recorded on oath and the later can be.


Nav Bharat Vanijya Ltd Vs DCIT, New Delhi (Dated: January 11, 2011)

Income Tax - Sections 10(34), 14A, Rule 8D - Whether the procedure prescribed in Rule 8D is applicable retrospectively.


M/s Aradhana Beverages & Foods Company Private Limited Vs DCIT, New Delhi (Dated: April 29, 2011)

Income Tax - Sections 37(1), 40(A)(2)(a), 40A(2)(b) - Whether purchases made by assessee from holding company and resold at a loss can be a sufficient ground for disallowance of the purchases.


DCIT, Mumbai Vs M/s Rediff Com India Pvt Ltd (Dated: May 25, 2011)

Income Tax - Sections 36(1)(vii), 37 - Whether evidence vis-à-vis crystallization of prior period expenses is sine qua non for their allowability - Whether claim of bad debts is allowable even if the debts are of the same year.


Shri Sakthi Constructions Vs ITO, Hyderabad (Dated: April 21, 2011)

Income Tax - Section 139(5) - Whether in absence of any omission and wrong statement, it is not permissible to file revise return - Whether original return would prevail over the revised return if the contents of the same are reconcilable with other documents - Whether burden to prove that a receipt is not its income under the provisions of income tax lies on assessee.


Mr Hitesh Satishchandra Doshi Etemia Vs JCIT, Mumbai (Dated: June 15, 2011)

Income tax – Sections 2(14), 2(29A), 2(42A), 43(5), CBDT Circular no. 4 of 2007 & 1827 of 1999 – Capital Gain v Business Profit – Whether profits from transfer of shares held for less than 30 days is entitled to be treated as short-term capital gains - Whether the profit arising on sale of shares is capital gain or business profit when the assessee has been maintaining two portfolios separately, no borrowed funds utilized for acquiring the shares, the shares shown in the books of account as investment, and the intention was to earn dividend – Whether the loss arising on sale of derivative transactions is speculative loss instead of business loss for the A.Y. 2006-07 as per the notification issued by the CBDT.



Systematic Exports Vs ACIT, Mumbai (Dated: May 27, 2011)

Income Tax - Sections 80IA, 80HHC - Whether deduction u/s 80IA and 80HHC are to be calculated independently on the eligible profits.


DCIT, New Delhi Vs Mascomptel (India) Ltd (Dated: June 17, 2011)

Income Tax - Section 143(2) - Whether when assessee has given his address in the e-return and the AO has also given TDS credit on the same, AO is right in serving notice u/s 143(2) by affixting the same on some other other address.

2011-TIOL-455-ITAT -MAD

M/s Southern Petrochemical Industries Corporation Ltd Vs JCIT, Chennai (Dated: April 21, 2011)

Income Tax - Sections 115JB, 263 - Whether when the failure of the AO to consider the applicability of the provisions of book profit, renders the assessment erroneous and prejudicial to the interest of revenue, it can be contended that retrospective amendment does not confer jurisdiction on CIT under section 263.


M/s Pyramid Infrastructure Pvt Ltd Vs DCIT, Hyderabad (Dated: February 18, 2011)

Income Tax - Sections 143(3), 263 - Whether when assessee sub-contracts work in progress and AO examines all the claims u/s 143(3), in such a situation, CIT is right in invoking revisionary powers u/s 263.


Owens Corning India Ltd Vs ITO, Mumbai (Dated: March 16, 2011)

Income Tax - Sections 28, 115JB - Whether aggregate amount of brought forward losses is required to be reduced from the book profit.


Jethiben K Patel Discretionary Trust Vs DCIT, Ahmedabad (Dated: May 6, 2011)

Income Tax - Sections 45, 48 112 - Whether in view of the provisions of section 112 where there are several transactions of sale and purchase of securities, the discretion to take the benefit of indexation lies with assessee, when the assessee has paid tax on capital gain @10%.


M/s Parth Developers Vs ITO, Ahmedabad (Dated: June 17, 2011)

Income tax – Section 40(a)(ia) - Condonation of delay – Whether when the counsel of the assessee fails to inform the assessee about the receipt of the order against which appeal is made after a delay of 403 days, the delay is rightly condoned taking a liberal approach – Whether no disallowance is to be made u/s 40(a)(ia) where the payment is made before the due date of filing of return as the amendment by Finance Act, 2010 is retrospective in nature.


ACIT, New Delhi Vs M/s Hari Machines Ltd (Dated: May 9, 2011)

Income tax – Section 32 – Whether no addition can be made for the difference in the receipts as per TDS certificate and as per the books of account when the difference is on account of service tax amount – Whether the assessee is entitled to depreciation u/s 32 on the equipment purchased during the impugned year once a government authority inspecting the equipment, certifies the date of power supply to the equipments and after inspection has permitted energisation of the equipment.


Echjay Forgings Pvt Ltd Vs ITO, Mumbai (Dated: May 31, 2011)

Income Tax - Sections 28, 37(1) - Whether when assessee reverses a unilateral write back of dues payable to a vendor to its P & L account, the liability is to be treated as contingent liability


ITO, Mumbai Vs M/s Dresdner Kleinwort Wasserstein Sec (I) Ltd (Dated: April 29, 2011)

Income Tax - Section 36(2)(i), 36(1)(vii), 37 - Whether when assessee has treated the sum of bad debt in computation of income, conditions mentioned in Sec 36(1)(vii) can be said to have been complied with - Whether sharing of office premises among the concerns is permissible when only one concern claims the deduction.


Dataxcess Integrated Technology Ltd Vs ACIT, Mumbai (Dated: May 31, 2011)

Income Tax - Sections 140A(3), 221(1) - Whether the explanation tendered by the assessee would constitute good and sufficient reason for non-payment of self-assessment tax when the plea of the assessee is not disputed or negated by the CIT(A).


Ahuja Platinum Properties Pvt Ltd Vs JCIT, Mumbai (Dated: June 24, 2011)

Income tax – Sections 36(1)(iii), 41(2), 40A(2)(b), 47(xiii), 72A(6) – Whether when the assessee has sufficient own funds, no disallowance can be made for the interest paid on borrowed funds, for the amount given on loan as interest free even though the assessee cannot show the nexus of interest free loans with the owned funds – Whether the expenses claimed as provision for anticipatory expenses to be incurred for the project completed cannot be disallowed when the income from the said project was declared by the assessee in the previous year – Whether no disallowance can be made for the proportionate expenses claimed for administrative expenses incurred to a common pool company based on the projects completed by various group companies as excessive payments as the AO has not brought on record any supporting that the expenses incurred are excessive.


M/s Invitro International Pvt Ltd Vs DCIT, Bangalore (Dated: May 31, 2011)

Income Tax - Section 2(1A) - Whether growing of pla nt in lab by applying scientific method of tissue culture can be termed as agricultural activity - Whether, to qualify as agricultural income, it is necessary for an operation to be carried on soil.


2011-TIOL-444-ITAT -PUNE

ITO, Pune Vs Audyogik Tantra Shikshan Santha (Dated: June 30, 2011)

Income Tax - Sections 254(2B), 271(1)(c) - Whether when the contents of assessment order given to the Department for filing appeal are different from the orig inal order given to assessee, the award of cost against Revenue is warranted - Whether penalty is leviable where no satisfaction for doing so is recorded in the copy of the order.


National Organic Chemical Industries Ltd Vs Addl.CIT, Mumbai (Dated: April 29, 2011)

Income Tax - Section 37 - Whether stamp duty paid during the course of amalgamation is revenue expense - Whether compensation paid to employees under VRS scheme is deductible as revenue expense.


DCIT, Hyderabad Vs Smt Sarada Educational Society (Dated: April 21, 2011)

Income Tax - Sections 69C, 139(5), 153C - Whether a bonafide error is different from intentional error and hence the guilty of the latter is not entitled for excuse - Whether addition u/s 69C of those expenses which have been shown in forced Return of Income is justifiable - Whether income assessed by applying Sec 69C is not available for deduction of 10(23C).



ACIT, Mumbai Vs M/s A F Ferguson & Co (Dated: May 18, 2011)

Income Tax - Section 271(1)(c) - Whether penalty survives even after addition is deleted.


ACIT, Mumbai Vs M/s P P Overseas (Dated: February 18, 2011)

Income Tax - Section 40(a)(ia), 194C - Whether the payment of statutory liabilities/miscellaneous expenses, etc made by the assessee to the C & F agency is covered u/s 194C.


Opel Shelters Pvt Ltd Vs ACIT, Pune (Dated: May 31, 2011)

Income tax – Section 80IB(10) – Whether when the project has also commercial shops, it is entitled to deduction u/s 80IB(10) if it was commenced prior to the amendment brought into section 80IB(10) w.e.f. 1st April, 2005.



DCIT, New Delhi Vs M/s Societex (Dated: March 25, 2011)

Income Tax - Sections 143(1)(a), 271(1)(c) - Whether the provision made for advance tax debited in the P&L account but not added back to income is bonafide mistake.


ACIT, Ahmedabad Vs The Xavier Kelavani Mandal Pvt Ltd (Dated: June 17, 2011)

Income tax – Sections 11, 12A, 292B, 139(9) – Whether the exemption u/s 11 is rightly disallowed to the assessee on the basis of the return filed in the wrong form due to technical error and no notice was given by the AO to the assessee to rectify the said mistake – Whether the audit report in Form 10B submitted before the CIT (A) can be accepted and the exemption can be allowed as the powers of CIT(A) are coterminous with those of the AO and it is sufficient compliance if the audit report in the prescribed form is submitted before the CIT(A).


ACIT, Ahmedabad Vs Torrent Investment Pvt Ltd (Dated: June 17, 2011)

Income Tax - Section 271(1)(c) - Whether the penalty u/s 271(1)(c) can be imposed when expenditure is separately shown in the P & L account which was filed with the return of income and the dispute was continuing from the earlier AYs.


M/s Earth Castle Vs DCIT, Mumbai (Dated: June 17, 2011)

Income tax – Sections 132, 271(1)(c) – Whether when assessee fails to rebut the addition made by the AO in respect of undisclosed income found during the search and also chooses not to file appeal against the huge quantum addition, penalty is warranted in such circumstances.



M/s Cosmic Kitchen Pvt Ltd Vs ACIT, New Delhi (Dated: May 13, 2011)

Income tax – Section 32(1) – Whether the depreciation on preoperative expenses allocated to fixed assets is to be allowed u/s 32 as the expenses incurred were for setting up the fixed assets and were incurred during the running trail.


M/s Crescent Real Estates Vs JCIT, Hyderabad (Dated: May 13, 2011)

Income Tax - Sections 40(b), 69, 69A - Whether interest and remuneration paid to partners is allowable, even in cases where income is determined by applying flat profit rate - Whether statement during the course of survey is rebuttable, if disproved with cogent materia - Whether any addition can be made on the basis of conflicting statements of third party - Whether presumption of the revenue that cash withdrawals might have been utilized somewhere else is tenable in absence of any material even after surve y - Whether value declared in a registered sale deed, duly confirmed by the vendors, would prevail over the unsigned receipt found in survey if revenue fails to corroborate such receipt with any cogent material.


M/s Navayuga Infotech Pvt Ltd Vs DCIT, Hyderabad (Dated: February 11, 2011)

Income Tax - Section 10A - Whether the expenditure incurred in foreign exchange shall be reduced from the total turnover while computing deduction - Whether expenditure on foreign travel spent in foreign exchange can be reduced from the export turnover for the purpose of computation of deduction u/s 10A - Whether interest on term deposits, profit on exchange variation etc can be reduced from the net profits for the purpose of computing the deduction u/s 10A.


DCIT, Hyderabad Vs The International Institute Of Information Technology (Dated: May 10, 2011)

Income Tax - Sections 10(23C), 254(1) - Whether an institute receiving capitation fee can claim exemption u/s 10(23C) - Whether Tribunal is duty bound to consider all the facts before adjudicating any issue and hence in the interest of justice ITAT can crystallise any inbuilt issue irrespective of specific ground vis -à-vis such issue - Whether decision of coordinate bench is binding unless the same is perverse.


Innovative Steals Pvt Ltd Vs ITO, New Delhi (Dated: May 31, 2011)

Income Tax - Section 115WC(2)(b) - Whether, for the levy of FBT, the connotation of the word 'construction' in Sec 115WC is restrictive and includes only civil construction works within its realm.



Credit Lyonnais Vs DDIT, Mumbai (Dated: July 8, 2011)

Income Tax - Section 154 - Whether the depreciation allowable at the rate of 50% or 20% is amenable to section 154.


Beejay Security & Finance Ltd Vs ACIT, Mumbai (Dated: June 24, 2011)

Income tax – Sections 132, 153A, 153C, 158BD, 292B - Whether when the documents seized by the AO of the searched party forwarded the seized material to the AO of the other person u/s 153C only stating that the documents were sent for verification purpose only, no proper satisfaction can be said as recorded u/s 153C – Whether provisions of Sec 153C of the Act are akin to Sec.158BD and once it is found

that the satisfaction is not properly recorded, the assessment is correctly annulled.


M/s Nemat Enterprises Pvt Ltd Vs ACIT, Mumbai (Dated: December 23, 2010)

Income tax – Section 80IC(2)(a) – Whether the Attars produced by the assessee is a manufactured item - Whether when it is not covered under Sr. No. 5 of Part B of 13th Schedule as an organic chemical which is a prohibited item, the deduction is not available u/s 80IC.


Weizmann Capital Ltd Vs ACIT, Mumbai (Dated: May 27, 2011)

Income Tax - Sections 73, 147, 148 - Whether reassessment can be framed on an issue which was not part of the reasons recorded - Whether when the AO ignores the issue triggering the reassessment and proceeds with the proceedings on another issue, such order is legally not tenable.


M/s Motherson Jones Limited Vs ITO, New Delhi (Dated: June 24, 2011)

Income Tax - Section 68 - Whether when assessee has made surrenders in the previous years, even then AO can make addition by treating the cash deposited in banks as undisclosed


ACIT, New Delhi Vs Indian Farmer Fertilisers Coop Ltd (Dated: May 31, 2011)

Income tax – Sections 14A, 37, 43B, Rule 8D – Whether the assessee is entitled to deduction 43B based on the tax audit report even though no supporting evidence for payment was produced before the AO – Whether the assessee is entitled to deduction for provision for contribution of administrative expenses of Coop. Education fund as per Multi State Co-operative Society as in the preceding years, the AO itself allowed such claim and without any material change it cannot be rejected – Whether the expenses cannot be disallowed @ 100% of the exempted income earned and the disallowance was rightly restricted as per Rule 8D.


Hindustan Platinum Pvt Ltd Vs ACIT, Mumbai (Dated: June 15, 2011)

Income tax – Sections 28, 32, 36(1)(vii) – Whether the assessee is entitled to depreciation on Wind Electric Generators from the date on which it was installed and commissioned – Whether the statement given u/s 131 cannot be the only basis for disallowing the claim of depreciation when it is shown with documentary evidence that the admission made in the statement recorded was under a mistake or misapprehension – Whether the assessee is entitled to claim loss u/s 28 on account bad debt of the advance given as inter corporate deposit without establishing the fact that it was a trade advance.


Mr Hemant Mangaldas Bhanushali Vs ITO, Mumbai (Dated: June 15, 2011)

Income tax – Sections 40(a)(ia), 263 – Whether when the CIT observes that the AO has not applied his mind while passing the order and did not call for the required details for completing the assessment, initiation of proceedings u/s 263 in such circumstances is valid.


Anjani Synthetics Ltd Vs DCIT, Ahmedabad (Dated: February 25, 2011)

Income Tax - Section 32(1)(iia) - Whether when Director's report admits that there was no change in the installed capacity of the company, a contrary report by the CA cannot contradict the same to claim additional depreciation - Whether, for enjoying benefit of section 32(1)(iia) which provides additional depreciation, an increase in the installed capacity of a unit is sine qua non.



Transpek Silox Industry Ltd Vs DCIT, Vadodara (Dated: May 31, 2011)

Income Tax – Sections 80HHC, 115JB, 154, 234A, B, C & D - Whether, when deductions claimed by the assessee are debatable, rectification order u/s 154 cannot be passed.


M/s Prism Jewellery ITO, Mumbai (Dated: June 30, 2011)

Income Tax - Sections 10A, 10A(7), 69, 80IA(10), 145(3), 271(1)(c) – Whether when assessee has not reconciled the use of raw materials and the price at which it was sold, the Revenue is justified to declare that assessee has declared higher profits to claim section 10A deduction - Whether discrepancy shown in the tax audit report, in the caratage of diamonds purchased by assessee, duly explained by the assessee as free samples given to customers, can be declared as unexplained investment in stock of diamonds.


ACIT, New Delhi Vs Shri Vijay Kumar Jindal (Dated: May 27, 2011)

Income Tax - Section 271(1)(C), CBDT Circular No 710 - Whether penalty is leviable where, except the Board circular, no other provision is present in the law for the taxation of a particular issue - Whether penalty is leviable where assessee offered certain income in a particular year and paid taxes bonafidely and the AO taxed the same in other year.


M/s Vodafone Essar South Ltd Vs CIT, New Delhi (Dated: July 24, 2011)

Income Tax - Section 263 - Whether revisional power u/s 263 can be exercised in a case where inadequate enquires were done by the AO during the course of assessment.


M/s Jyoti Traders Vs DCIT, Mumbai (Dated: May 20, 2011)

Income Tax - Sections 132, 142(2A), 143(2), 158BE, 263 - Whether opportunity of being heard is mandatory prior to the direction of special audit - Whether prior to the Board Circular the AO had power to extend the time suo-motto - Whether where decision of the High Court deserves importance instead of subsequent decision of ITAT distinguishing the High Court decisions - Whether ITAT is duty bound to oblige the decision of High Court - Whether prior scrutiny of accounts before referring them for special audit is sine qua-non and if the same has not been done the direction for special audit is bad in law and hence assessment framed is a nullity.


DCIT, Baroda Vs Liberty Phosphate Ltd (Dated: June 17, 2011)

Income tax – Capital or Revenue Expenditure – Sections 2(24), 36(1)(va), 36(1)(iii) – Whether the expenses incurred for maintenance of building structure owned by the assessee and for the safety of the employees is revenue in nature and does not bring into existence any new asset - Whether when the interest free loan is given to various parties out of own funds, no disallowance can be made u/s 36(1)(vii) for interest on borrowed funds.


Shri Abdul Razzak A Rajkotia Vs ACIT, Mumbai (Dated: April 29, 2011)

Income tax – Sections 153A, 271(1)(c) – Whether, even if no incriminating document is found during the search but assessee makes some voluntary disclosure, penalty is till warranted.


MRG Developers (P) Ltd Vs ITO, New Delhi (Dated: May 20, 2011)

Income tax – Section 68 – Whether when assessee has no market but manages to raise huge funds as application money within a short span of time, AO is right in taxing the same u/s 68 – Whether when no information regarding the assessment records of alleged entry operators is considered by the AO due to non completion of assessment in those cases, the assessment is rightly set aside to the AO.


Shriram Pistons & Rings Ltd Vs ACIT, New Delhi (Dated: May 31, 2011)

Income Tax - Section 37 - Whether an expense which is recurring and incurred in order to enhance the output of the unit and related to revenue filed is revenue expenditure - Whether expenses incurred on ISO certification are revenue.


DCIT, New Delhi Vs M/s Technovate Esolutions Pvt Ltd (Dated: June 20, 2011)

Income tax – Section 10A – Whether the STPI registration granted to the assessee is valid for allowing deduction u/s 10A – Whether the expenses incurred for purchase of software which are supportive in nature and do not bring into existence any asset are to be allowed as revenue in nature.


M/s Corporate Infrastructure Services Private Ltd Vs DCIT, Bangalore (Dated: May 26, 2011)

Income Tax - Section 143(1), 244A, 246 - Whether, without confronting form -35 to the AO, CIT(A) can declare an appeal as delayed - Whether hasty manner of dismissing the appeal without looking at the grounds is tenable.


Chiranjeev Lal Khanna Vs ITO, Mumbai (Dated: April 23, 2011)

Income tax - Sections 2(47), 50C, 54, 54EC - Whether grant of redevelopment rights on a property amounts to transfer of property, and thus, gives rise to capital gains, liable to tax - Whether provisions of Sec 50C are invokable in such a case.


2011-TIOL-408-ITAT -VIZAG

M/s Susi Sea Foods Pvt Ltd Vs ACIT, Visakhapatnam (Dated: May 9, 2011)

Income tax – Sections 70, 79, 115JA, 220(2) – Whether AO cannot apply sections 70 to 79 of the Income tax Act while computing the amount deductible under clause (iii) for the purpose of book profit as it nowhere prescribes the manner of set off or modalities of carry forwa rd and set off of loss to be followed for book purposes, even though there is no method of computation of brought forward losses and unabsorbed depreciation and its set off is given under the Companies Act.


HCC-L&T Purulia Joint Venture Vs JCIT, Mumbai (Dated: June 24, 2011)

Income tax – Sections 40(a)(ia), 194C – Whether the assessee, a sub contractor, is required to deduct tax at source for the payment made by it to its sub contractor though as per Explanation 1 for the purpose of sub-section (2) of Sec 194C the expression ‘contractor' shall include a contractor who is carrying out any work in pursuance of a contract between the contractor and the Government of a foreign state

or foreign enterprise or any association or body established outside India but does not include within its fold a sub-contractor carrying out any work in pursuance of a sub-contract with a sub subcontractor and the amendment made by the Finance Act 2 of 2009 to cover such payment made by the resident sub-contractor to its sub contractor is applicable w.e.f. 1/10/2009 and cannot be applied to the A.Ys. prior to the said amendment.


JCIT, Mumbai Vs M/s Videocon Industries Ltd (Dated: May 20, 2011)

Income Tax - Section 36(1)(vii) - Whether loss of investment is allowable as business loss - Whether for claiming an amount as bad debt conditions specified in section 36(2)(i) are required to be fulfilled - Whether a capital loss emerging out of previous years can be treated as bad debt - Whether capital loss which accrues as a result of long term investment can be treated as bad debt merely because the benefit of indexation was not taken at the time of computing capital loss.


Addl.CIT, Mumbai Vs Tribhovandas Bhimji Zaveri (Dated: June 24, 2011)

Income tax – Sections 22, 37, 80IB – Whether, merely because Mumbai office is also involved in the business, the Hyderabad Unit cannot claim Sec 80IB benefits for manufacture of jewellery through various karigars spread across various locations - Whether the assessee is entitled to foreign travelling expenses incurred on the managing partners and their family members – Whether while determining the annual value u/s 22, the municipal va luation should be taken as yardstick for determining the annual value where the actual rent received is less than the municipal valuation.



DCIT, Mumbai Vs M/s Kaizen Commercial Pvt Ltd (Dated: June 10, 2011)

Income Tax - Section 28(iv) - Whether merely because a telecom Company has got licence and has bright future, it can be presumed that contemporaneous value of share, irrespective of it's negative net worth on the day when it got licence, is on higher side and hence any addition in the hands of share holder on presumptive basis is tenable - Whether in the absence of any business relations, any addition can be made in the hands of assessee u/s 28(iv).


ACIT, New Delhi Vs Parablic Drugs Ltd (Dated: June 17, 2011)

Income tax – Sections 35(2AB), 35(1)(i), 37(1), 115JB – Whether when assessee gives wrong treatment to R & D expenditure in its books as capital expenditure and competent authorities also deny it benefits of Sec 35(2AB) on this basis, even then assessee's claim of deduction by treating it as revenue expenditure in P&L Accounts is allowable - Whether the amount is deductible u/s 37(1) or 35(1)(i) as the nature of expenditure does not change due to the treatment of the same in the books of account.


ITO, New Delhi Vs M/s Vijay Bharat Roadlines Pvt Ltd (Dated: June 23, 2011)

Income tax – Sections 40(a)(ia), 194C, Rule 46A – Whether the payments made to lorry/truck owners who merely placed the vehicles at the disposal of the assessee and never involved themselves in the work to be carried out by the assessee, would not attract provisions of section 194C and hence no disallowance can be made u/s 40(a)(ia).

2011-TIOL-401-ITAT -INDORE

ACIT, Sagar Vs M/s Vijay Traders (Dated: May 31, 2011)

Income tax – Section 153A, 153C, 143(2) – Whether when the assessment is made u/s 153C without recording proper satisfaction, such assessment is bad in law – Whether where no notice is issued u/s 143(2) after filing of return, assessment made is bad in law.


ACIT, Mumbai Vs M/s Skylark Build (Dated: June 17, 2011)

Income tax – AS-7 - Whether when assessee follows project completion method as per AS-7, it is entitled to set off receipts from sale of TDR against costs of work -in-progress - Whether such amount is taxable in the year of receipt.



ACIT, Mumbai Vs M/s Aftek Infosys Limited (Dated: April 20, 2011)

Income Tax - Sections 10B, 37 - Whether when assessee provides software services, expenses incurred on development of software are revenue - Whether for treating an

amount of sale proceeds as part of “export turnover” it is sine qua non that the same must be brought into India within six month otherwise such an amount is to be excluded from the figure of ‘export turnover” though it is part of “total turnover”.


M/s Bisazza India Pvt Ltd Vs CIT, Ahmedabad (Dated: May 27, 2011)

Income Tax - Sections 80HHC, 115JA, 263 - Whether when entire business loss and unabsorbed depreciation are setoff against the income of earlier year, even then Sec 80HHC can be availed on such sums - Whether while computing book profit the amount of eligible profits under section 80HHC is to be seen and not the quantum of deductions.


Satara Cattle Feed Industries Pvt Ltd Vs ACIT, Satara (Dated: May 31, 2011)

Income tax – Section 263 – Whether the review proceedings initiated u/s 263 are not valid when the AO examines the issue of final income which is lower than the additional income declared during survey and there is no material found by the CIT that the reasons which were accepted by the AO for evaluating the short-fall in profit are incorrect.


M/s Smita Conductors Ltd Vs ITO, Mumbai (Dated: January 31, 2011)

Income Tax - Section 145 - Whether, if there is a mismatch of modvat credit and Central Excise duty payable on closing stock, rejection of books is justifiably warranted.



ACIT, Chennai Vs M/s Tube Investments Of India Ltd (Dated: May 23, 2011)

Income Tax -Section 194C, 201(1), 201(1A) - Whether the provisions of section 194C will apply in a case where the invoices clearly show that sales tax and excise duty were collected on the supply of materials by the vendors.


DCIT, Ahmedabad Vs Shri Niten Hasmukhbhai Shah (Dated: May 27, 2011)

Income Tax - Sections 40(a)(ai), 194C(3)(i) - Whether in absence of any oral or written contract, provisions of Sec 194 are not attracted.


ITO, Bharuch Vs The Ankleshwar Taluka ONGC (Dated: May 20, 2011)

Income tax – Sections 40(a)(ia), 43B, 143(3), 194C – Whether when the assessee-society acts as an intermediate between the company and the members of the society, and the fact that there is no relationship between the assessee and its members as contractor and contractee, section 194C does not get attracted and no disallowance could be made u/s 40(a)(ia).


ITC Limited Vs DCIT, Kolkata (Dated: June 10, 2011)

Income Tax - Sections 10(1), 14A, 37, 80IA, 40A(9) - Whether expenses reimbursed to recreation clubs and staff clubs of employees are revenue in nature - Whether when AO has made proportionate disallowances of expenses attributable to tax free income there is no question of rule 8D - Whether security deposits for some essential business equipment are revenue in nature - Whether post-amended benefits are available to an assessee who started its unit at the time of pre-amended provisions but opted for deduction of 80IA under new provisions - Whether income from cultivation of colonel plants is agricultural income and available for deduction of 80-IA.


ITO, Ahmedabad Vs Gujarat Information Technology Fund (Dated: May 27, 2011)

Income Tax - Section 10(23FB) - SEBI Regulations - 8, 12, 30 - Whether an assessee, which is registered as trust and fulfills all the requirements of section 10(23FB) and also satisfies the pre and post condition of SEBI Regulations 8 and 12 and has not received any notice under regulation 30 can be termed as venture capital fund - Whether conditions specified in SEBI regulation and section 10(23FB) are pari-materia and hence compliance of one establishes the compliance of other.



M/s Gujrat Organics Ltd Vs ACIT, Mumbai (Dated: February 9, 2011)

Income tax – Sections 14A, 145A - Capital or Revenue Expenditure – Whether, if assessee fails to include excise element in the value of closing stock, it calls for disallowance - Whether the disallowance is rightly made u/s 14A by applying rule 8D prior to the amendment – Whether the expenses incurred on repair and maintenance of assets which results in no new asset are revenue expenditure.


ACIT, Mumbai Vs M/s JPS Associates (Dated: February 25, 2011)

Income Tax - Section14 - Whether income earned from letting of office premises is taxable under the head “income from house property' - Whether higher charges received on account of exploitation of computers and office premises are taxable under the head business income on the basis of principle of consistency.


M/s P A Chacko Muthalaly Vs ACIT, Mumbai (Dated: March 4, 2011)

Income Tax - Sections 80(O), 80RRA, 80RRA(2)(ii) - Whether, to avail Sec 80RRA benefits, it is necessary for the assessee to undertake a foreign travel - Whether assessee is eligible for benefits even if the technical services provided by the assessee are not approved by the Govt.


ADIT, Mumbai Vs Bombay Real Estate Development Company Pvt Ltd (Dated: June 3, 2011)

Income tax – Sections 40A(2), 80IB(10) – Whether when assessee enters into agreement with a builder to construct a building and also get approvals from various authorities, it is merely a case of transfer of right in the land and Sec 80IB(10) benefits cannot be allowed to the assessee - Whether no disallowance can be made u/s 40A(2) without comparing the payment made by other companies to similarly qualified and capable Managing Directors and nothing has been brought on record to show that the payment was excessive or unreasonable.



M/s Mitsui & Co India Pvt Ltd Vs Addl.CIT, New Delhi (Dated: June 3, 2011)

Income Tax - Sections 17(2), 37(1) - Whether car expenses incurred for personal use of directors of the company are allowable as business expenditure.


DCIT, New Delhi Vs M/s NTPC-SAIL Power Supply Co Ltd (Dated: March 25, 2011)

Income tax – Sections 2(47)(v), 32, 36(1)(iii), 47, 47A, 56, 57 – Whether for the purpose of determining the applicability of section 47, the condition for wholly-owned subsidiary is to be seen on the last date of financial year and explanation 6 to sectio n 43(1) is not applicable – Whether where the shareholding pattern is changed and the assessee company seized to be a subsidiary company, the transfer of asset from the original company is not covered under section 47(iv) – Whether the assessee will be entitled to depreciation on the cost at which the assessee company acquired the plant since the assessee company seized to be a subsidiary and the transaction in the hands of the assessee company has to be treated as transfer at the cost at which it had acquired the asset – Whether after insertion of proviso to section 36(1)(iii), the interest paid on capital borrowed for acquisition of an asset for extension of existing business or profession for any period beginning from the date on which the capital was borrowed for acquisition of the asset till the date on which such asset was first put to use, is rightly not allowed as deduction and the interest income earned on FDRs made from surplus fund and interest earned on margins and advances made for expansion work is rightly assessed under the head ‘income from other sources'.


DCIT, Mumbai Vs Mr Sanjeev R Kanwar (Dated: January 31, 2011)

Income Tax - Sections 131, 143(3), 147 - Whether, for making additions, FIR is contemporaneous evidence and the contents of the same cannot be ignored in the light of self-serving documents - Whether human conduct and human probabilities are to be given weightage over the self generated evidences.



M/s Bachhraj Factories Pvt Ltd Vs ITO, Mumbai (Dated: May 20, 2011)

Income tax – Section 2(47) – Whether when the title of the assessee on the impugned land is not clear, income arising from transfer of such land is to be treated as capital gain or income from other sources.


M/s HSBC Asset Management (India) Private Limited Vs DDIT, Mumbai (Dated: June 15, 2011)

Income Tax – Sections 32(1)(ii), 37(1), 43, 43(6)(c), 143(3) – Whether pre-operative expenses and registration fee paid to SEBI are allowable as intangible asset and assessee can claim depreciation on the same - Whether AO can question the allowability if same was allowed in the earlier AY.


Indusind Bank Ltd Vs ACIT, Mumbai (Dated: April 29, 2011)

Income tax – Sections 5, 145 – Whether interest on government securities will become taxable on the date of coupon date as the assessee receives the right of the interest in the said securities only on the said date and it does not become due on day to day basis.


M/s Industrial Thermoplastics Vs ITO, Mumbai (Dated: February 18, 2011)

Income tax – Sections 36(1)(iii), 40A(2)(b), 69C, 40(a)(ia) – Whether the disallowance is warranted u/s 40(a)(ia) for non-deduction of tax on interest payment by the assessee to a concern covered u/s 40A(2) though the assessee has explained that there is no taxable income of the corporation and the defects in Form 15H are curable and cannot be considered without giving an opportunity to rectify the defects.


M/s Medreich Ltd Vs DCIT, Bangalore (Dated: February 22, 2011)

Income Tax - Sections 35D, 37, 143(1)(a) - Whether raising of funds via share money and application of such funds are two different perspectives, and hence expenses incurred in relation to issuance of shares would not become revenue if the funds collected are applied for meeting working capital requirements - Whether it is the privilege of the company to utilize the funds of shares in any manner and hence the scope of expenses incurred would end till the collection


Power Pack Conductors Vs ITO, Mumbai (Dated: March 3, 2011)

Income Tax - Section 143(3) r.w.s. 147 - Whether when an assessment is reopened on a particular ground but during the course of assessment, no addition is made in respect of the same ground, Revenue can make other additions in the course of such assessment proceedings.


M/s Western Outdoor Interactive Pvt Ltd Vs ITO, Mumbai (Dated: April 29, 2011)

Income Tax - Section 263 - Whether CIT can invoke jurisdiction u/s 263 on the ground that assessment is completed without conducting necessary enquiries in relation to the expenses of SEEPZ Unit.


Universal Cables Ltd Vs DCIT, Kolkata (Dated: April 29, 2011)

Income Tax - Sections 14A, 43B(f), Rule 8D - Whether the provision for leave encashment can be considered for the purpose of computing disallowance u/s. 43B(f) - Whether Rule 8D is applicable retrospectively.

2011-TIOL-375-ITAT -MUM-SB

M/s Dalal Broacha Stock Broking Pvt Ltd Vs Addl.CIT, Mumbai (Dated: June 22, 2011)

Income tax – Sections 36(1)(ii), 37(1), 40A(2) – Whether when commission is paid to the Directors of the assessee-company who hold all the shares of the company, disallowance is warranted on the ground that the commission was paid in lieu of dividend to avoid tax on dividend - Whether section 36(1)(ii) is applicable only to employees who are not shareholders – Whether the expression “payable” used in section 36(1)(ii) means that the shareholder should have right to receive dividend and since the payment of dividend is discretionary to be decided by the management of the company and not compulsory, it cannot be said that the dividend is payable in case of the employee directors – Whether payment of bonus or commission to an employee / director will also be co vered by the provisions of section 36(1)(ii) and not under section 37(1).



M/s J L Morison (India) Ltd Vs ACIT, Kolkata (Dated: April 13, 2011)

Income tax – Section 263 – Whether when the AO has taken one of the possible views in respect of the various issued raised by the CIT on the basis of which proceedings were initiated u/s 263, such proceedings can be initiated treating the view taken by the AO as erroneous or prejudicial to the interests of the revenue.


ITO, Delhi Vs M/s Kaliashpati Overseas Pvt Ltd (Dated: March 31, 2011)

Income tax – Sections 143(1), 148 – Whether the sufficiency, adequacy and correctness of the reasons cannot be gone into at the stage of initiation of proceedings u/s 147 – Whether the amount received by the assessee and sale receipts from sale of shares is rightly considered as income u/s 68 though the assessee furnished all the necessary documents to prove the transactions genuine and the AO did not investigate the modus operandi as was explained by the investigation wing.


Rambagh Palace Hotels Pvt Ltd Vs ITO, New Delhi (Dated: March 11, 2011)

Income tax – Sections 143(3), 263 – Doctrine of merger – Whether when the issue of siphoning off of funds is settled by the CIT(A), review proceedings u/s 263 cannot be initiated - Whether CIT has no power to review the AO's order which got merged with the CIT(A) order.


M/s Indian Railway Finance Corpn Ltd Vs Addl.CIT, New Delhi (Dated: January 31, 2011)

Income tax – Sections 115JB - Whether the lease equalisation charges which represented the recovery of fair value of leased assets are rightly added to the net income as per the profit and loss account while computing the book profits u/s 115JB – Whether the bond issue charges are revenue in nature – Whether the assessee is entitled to depreciation on the assets which were in its possession and it cannot be denied merely on the ground that the registration formalities were pending.

2011-TIOL-370-ITAT -CHD

M/s Vodafone Essar Ltd Vs Addl.CIT, Chandigarh (Dated: May 13, 2011)

Income tax - stay - Whether when assessee is directed to pledge its investment with its subsidiaries as security of the balance demand stayed but since the same is already pledged to bankers, Tribunal is right in allowing the assessee to furnish security instead.

2011-TIOL-369-ITAT -COCHIN

Dy.DIT, Ernakulam Vs Adi Sankara Trust (Dated: June 16, 2011)

Income Tax - Sections 11, 12A, 32(1) - Whether when assessee, a charitable body, has already claimed deduction for acquisition of capital assets as application of money, the further claim of depreciation on the same assets would amount to double benefits.



The Tata Power Co Ltd Vs Addl.CIT, Mumbai (Dated: May 31, 2011)

Income Tax - Sections 54EC, 72, 74 - Whether when assessee has long-term capital gains, the stage of setting off of long-term capital loss comes only after grant of exemption u/s 54EC.

2011-TIOL-367-ITAT -CHD

M/s Vodafone Essar Ltd Vs Addl.CIIT, Chandigarh (Dated: April 7, 2011)

Income Tax - Sections 14A, 40(a)(ia), 80IA, 115JB, 143(3), 144C(13), 194C, 195, 220(6), 226(3) - Whether when Sec 80IA benefits are debatable, the Tribunal is right in granting conditional stay of high-pitch demand raised - Whether, to do justice to the cause of Revenue, Tribunal is right in directing the assessee to pledge its investments in subsidiaries as security with the AO for the balance demand.


M/s Rane Brake Lining Ltd Vs ITO, Chennai (Dated: April 21, 2011)

Income tax – Sections 14A, 80HHC, 80IB – Whether disallowance can be made u/s 14A for the interest on borrowed fund even if it is explained that the funds utilised for investments are not borrowed funds – Whether 90% of the rent recovered as sublet is to be excluded from the profit eligible for deduction u/s 80HHC while computing the deduction – Whether the deduction u/s 80HHC is to be allowed after reducing the deduction u/s 80IB.


DCWT Kolkata Vs M/s Mcleod Russel India Ltd (Dated: May 6, 2011)

Income Tax - Section 115-O, 115WA – Whether FBT is payable even in the absence of any taxable income – Whether provision of section 115-O & 115WA are pari-materia and hence FBT is leviable only to the extent of those expenses which are directly relatable to the Income taxable under the Income Tax Act - Whether when only 40% income of a tea company is chargeable to tax, even FBT liability arises on only 40% of expenses.



DCIT, New Delhi Vs M/s Sapient Corporation Pvt Ltd (Dated: April 8, 2011)

Income Tax - Sections 32(2), 37 - Whether expenses incurred by assessee on recruitment and training of employees are capital merely because the assessee may earn benefits even in future - Whether 60% depreciation is available on computers.


M/s Siel Ltd Vs DCIT, New Delhi (Dated: May 20, 2011)

Income Tax - Sections 37, 43B, CBDT Circular 601 of 1990 - Whether when assessee makes a claim u/s 43B, a CA's certificate in place of original tax challan is sufficient to prove that payment was deposited - Whether payment of excise duty on behalf of a going concern of which the assessee has undertaken the liabilities is revenue expense.



LIC Housing Finance Ltd Vs DCIT, Mumbai (Dated: April 29, 2011)

Income tax – Sections 10(33), 10(15), 14A, 143(1), 147, 148, Rule 8D – Whether where all the facts regarding the amount written off for non-convertible debentures are considered by the AO in the original assessment, reassessment proceedings cannot be initiated by issuing notice u/s 148 merely on change of opinion – Whether disallowance cannot be made u/s 14A by applying rule 8D for the period prior to A.Y. 2008-09.


The Lakshmi Vilas Bank Ltd Vs Addl.CIT, Tiruchirapalli (Dated: May 6, 2011)

Income tax – Sections 36(1)(vii), 263 – Whether where the AO has considered all the points, on the basis of which the CIT initiated proceedings u/s 263, following the decision of the ITAT and High Court in the case of the assessee itself, proceedings initiated u/s 263 are not valid as it is not prejudicial to the intere sts of the Revenue.


ACIT, Gandhinagar Vs Gujarat State Energy Generation Ltd (Dated: A pril 15, 2011)

Income tax – Sections 32, 80IA, 115JB – Whether the assessee which once opted for SLM method of depreciation, can change it to WDV by filing a valid revised return before the assessment is made – Whether the expenses for which the liability has crystallized during the year cannot be treated as prior period expenses – Whether the adjustment can be made in the book profit u/s 115JB for the items which are not mentioned specifically in the explanation to section 115JB – Whether the assessee is entitled to deduction u/s 80IA even when there is no positive income.


Shantaben Karshanbhai Patel Vs DCIT, Ahmedabad (Dated: December 31, 2010)

Income Tax - Sections 154, 244A(2), 246A - Whether the claim of interest simpliciter is appeallable order before the CIT(A) as per section 246A.


Singareni Collieries Company Ltd Vs ACIT, Khammam (Dated: March 31, 2011)

Income Tax - Sections 115JA(2), 115JB - Book profits - Whether book profits is to be computed with reference to each assessment year - Whether profits earned during the period of sickness and available for setting off under normal provisions of Income Tax are to be excluded from the ambit of book profit of non-sick years.



Sami Labs Ltd Vs DCIT, Bangalore (Dated: February 25, 2011)

Income Tax - Section 37 - Whether expenses incurred on cultivation for adequate and steady supply of medicinal plant are allowable even though there is no agricultural activities done by an assessee directly.


Dy.CIT, Pune Vs KRA Holding & Trading Pvt Ltd (Dated: January 19, 2011)

Income Tax - Sections 80M, 115O - Whether section 1150(5) in any way restricts the allowability of the claim u/s 80M.


Dy.CIT, Mumbai Vs M/s Shah Builders & Developers (Dated: May 6, 2011)

Income tax – Section 80IB(10) – Whether the assessee is entitled to deduction u/s 80IB(10) for a residential cum commercial building which was approved by the local authority before the insertion of clause (d) in s. 80-IB(10) w.e.f. 1st April, 2005 which is prospective and not retrospective.


Pushpsons International Vs ACIT, New Delhi (Dated: April 21, 2011)

Income tax – Section 37(1) –Whether, even in the absence of a written agreement to join back the firm, the expenditure incurred by the firm on higher education abroad of grandson of one of the firm's partners working there as an apprentice can be claimed as business expenditure.



DCIT, Haldwani Vs Shri Om Prakash Bhargava (Dated: March 11, 2011)

Income Tax - Whether when AO has accepted higher agricultural income in the previous AY, it can reject the income declared on basis of general information collected from Chief Agriculture Officer and without confronting the same with the assessee.


Convergys India Services Pvt Ltd Vs DCIT, New Delhi (Dated: May 27, 2011)

Income Tax – Sections 10A, 143(3), 263 – Whether assessee is entitled to deduction u/s 10A on the foreign exchange fluctuation gain which is derived on external commercial borrowings and not from the export activity of the assessee.



DCIT, Mumbai Vs M/s Axis Electrical Components (I) Pvt Ltd (Dated: May 3, 2011)

Income Tax - Section 145A - Whether, if the assessee fails to include modvat credit in the closing stock, AO is right in making additions on this count.


Century Textiles & Industries Ltd Vs DCIT, Mumbai (Dated: April 6, 2011)

Income tax – Sections 115JB, 143, 147, 263 – Whether the period of limitation for the purpose of CIT order u/s 263 in respect of an issue which is not the subject matter of reassessment proceedings will commence from the date of the original order and not from the date of the reassessment order.


Godfrey Philips India Limited Vs Addl.CIT, Mumbai (Dated: May 31, 2011)

Income tax – Sections 32, 36(1)(iii), 145A - Whether when the life of cylinders and dyes consumed in printing has short shelf life, such expenses are to be treated as

revenue in nature - Whether the assessee is entitled to hig her depreciation on the UPS as these are the "Automatic voltage controller machines" listed under the head "Energy Saving Devices" as an electrical instrument eligible for 100% depreciation – Whether no disallowance can be made for the interest expenditure for the amount which was given on loan by the assessee to its sister concern at a reduced rate of interest if it is given out of own funds – Whether the disallowance is wrongly made on adhoc basis for the leave encashment without determining the amount for which the deduction was claimed on the basis of actuarial valuation after change of the basis of claim on actual payment basis.


ITO, Mumbai Vs GSB Capital Markets Ltd (Dated: April 27, 2011)

Income tax – Sections 36(2), 40A(2), 2(22)(e), 73 – Whether where the assessee has considered the amount receivable from debtor as bad debts in the books of account, no disallowance can be made for want of fulfilment of conditions of section 36(2) – Whether where the amount is given to the sister concern by the assessee interest-free out of own funds and for business purposes, no disallowance can be made for interest expenses u/s 40A(2)(a) – Whether the losses of mutual funds are rightly adjusted against the speculation profit on shares in view of explanation to section 73 - Whether where the amount is taken by the assessee under a business transaction, no addition can be made u/s 2(22)(e) for deemed dividend.


Shramjivi Nagari Sahakari Pat Sanstha Vs Addll.CIT, Pune (Dated: June 8, 2011)

Income tax – Sections 226(3), 254(2B), 269SS, 269T, 271E, 271D, 273B – Whether when it is proved that the recovery authorities have committed excesses by attaching bank account of the assessee despite the circular issued by the Board and the instruction issued by the CCIT concerned, assessee is entitled to claim compensation - Whether penalty proceedings u/s 271D and 271E are warranted even if the Board calls for discrimiante application of such powers for alleged violation of Sections 269SS and 269T.


KRA Holding & Trading Pvt Ltd Vs Dy.CIT, Pune (Dated: May 31, 2011)

Income Tax – Section 48 - Whether, for the purpose of computing capital gains under Portfolio Management Service, the fee paid to the Asset Management Company at certain percentage of the NAV of the portfolio for purchase and sale of the securities is an allowable deduction.



ACIT, Faridabad Vs M/s Presco Mec Autocomp Pvt Ltd (Dated: February 18, 2011)

Income tax – Sections 37, 40(a)(ia), 40A(2)(b), 133(6), 194C – Whether disallowance is warranted for the freight and cartage expenses incurred in cash without rejecting the books of account only on the basis of surmises and presumptions – Whether the assessee is required to deduct TDS u/s 194C on the payment made to the transporter though there is no formal agreement with it – Whether the interest paid in excess of the rate of interest applicable for bank can be said to be excessive payment u/s 40A(2) of the Act.


M/s Mahanagar Telephone Nigam Limited Vs Addl.CIT, New Delhi (Dated: April 21, 2011)

Income Tax - Section 80IA - Whether proportionate deduction under section 80IA is permissible where major amount of profits is attributable to new setup and meagre amount is attributable to old set up in view of the amended provisions of of clause (iv)(c) of 80-IA and 80IA(4)(ii) - Whether quantum of deduction under section 80IA is directly proportional to the profits of the undertaking and hence it has nothing to do with investment made in plant and machinery.


M/s International Land Development (P) Ltd Vs ITO, New Delhi (Dated: May 6, 2011)

Income tax – Sections 2(22)(e), 194 – Whether where the receipt of the amount is not a shareholder of the company, the amount given to it cannot be considered as deemed dividend and no disallowance can be made for non deduction of tax on such amount u/s 194 – Whether where the amount was advanced due to the business exigencies as per agreement executed between the parties, it cannot be considered as deemed dividend.


ACIT, New Delhi Vs M/s Dhir Global Industria Pvt Ltd (Dated: July 30, 2010)

Income Tax - Section 10B - Whether provisions of proviso to section 10B(1) are akin to the provision of section 10(5), and hence deduction u/s 10B is allowable on delayed return, and the newly-inserted proviso applicable from 1.4.2006, is directory in nature.


M/s Merck Ltd Vs ACIT, Mumbai (Dated: April 27, 2011)

IncomeTax - Sections 14A, 94, 94(7), 143(3) - Whether section 94 is attracted and penalty is justified when assessee sets off the loss on sale of its mutual fund units against profit on short term investments but does not claim the loss as a deduction.



Hidelbergcement India Ltd Vs ACIT, Mumbai (Dated: May 13, 2011)

Income Tax - Sections 43A, 143(3), 147, 148 – Whether, when the AO has examined the issue of loss arising out of fluctuation in foreign exchange, even then reassessment can be initiated on the same ground.


M/s Perfetti India Ltd Vs ACIT, New Delhi (Dated: May 6, 2011)

Income Tax - Section 28 - Whether, even if there is no evidence to the effect that the borrowed forex loan was utilised for the purpose of business, the loss arising out of foreign exchange fluctuation can be allowed based on past history.


M/s Total Securities Ltd Vs DCIT, Mumbai (Dated: December 31, 2010)

Income Tax - Section 37(1) - Whether penalty paid by a registered broker is not a fine for any infringement of law and hence allowable - Whether admission fee paid by the assessee to stock exchange for acquiring membership is revenue - Whether salary paid to directors can be disallowed on the ground that the assessee has failed to prove the genuineness of services rendered when similar payments have been allowed in subsequent years - Whether payments made to arbitragers and jobbers is covered by 194C and hence the same is not allowable if TDS is not deducted.


Gajendra Kumar T Agarwal Vs ITO, Mumbai (Dated: May 31, 2011)

Income tax – Section 43(5), 72, 73, 263 – Whether the losses incurred in dealing in derivatives in earlier assessment years are eligible to be set off against the profits from the same activity post amendment to definition of speculation transactions under section 43(5) w.e.f. 1st April, 2006.


ITO, New Delhi Vs M/s Omni Globeinformation Technologies India (P) Ltd (Dated: April 29, 2011)

Income Tax - Sections 143(1), (2) & (3) – Whether disallowance of expenses is warranted if it is established that although computers were purchased but training of personnel was done later and premises were hired much later.


ACIT, New Delhi Vs M/s Headstrong Services India Pvt Ltd (Dated: April 8, 2011)

Income tax – Section 10A – Whether assessee once opts not to claim exemption u/s 10A(8), it cannot do so in future AYs even if it fulfills all the conditions of section 10A.


ACIT, Mumbai Vs M/s Rochem Separation Systems (I) Pvt Ltd (Dated: May 16, 2011)

Income tax – Sections 2(24)(iv), 37(1), 132, 133A, 153A, 197 – Whether when no incriminating documents are found in a search proceeding nor summons are issued by the AO for any specific document, commission expenses incurred for business purpose cannot be disallowed only on the basis of assumptions and presumptions – Whether where the consumption of purchases is not doubted and the assessee submitted the proof of purchase of material and the labour work done on it, the disallowance cannot be made only on the basis of the third party statement that no purchases were made though in the earlier two statements it was accepted by them that the purchases by the assessee were genuine – Whether the expenses incurred on higher education of the son of the director is rightly not allowed as business expenditure as at that time, the son was neither the employee nor the director of the company – Whether the expenses incurred on marriage reception of the son of the assessee which was considered as business meet is rightly disallowed in the hands of the company based on the statement recorded of the employee of the assessee company during search proceedings and simultaneously the amount is rightly added in the hands of the son as income u/s 2(24)(iv) as it was a personal obligation met by the company.


M/s Karnataka Power Transmission Corporation Ltd Vs ITO, Bangalore (Dated: April 21, 2011)

Income tax – Sections 194C, 194J, 201(1A) – Whether when assessee enters into agreements with sub-contractors for civil construction and erection of transmission towers and also supplies materials, the assessee is liable to tax deduction at source on the supply portion as well - Whether when contractors compensate farmers for uprooting their trees for installation of towers on behalf of assessee and also undertake the work of haulage of felled trees to stores, it attracts provisions of Sec 194C - Whether provisions of TDS get attracted on payments made for carrying out Survey Work.



Cadbury India Limited Vs ACIT, Mumbai (Dated: May 11, 2011)

Income Tax - Section 80HHC - Whether, for the purpose of claiming Sec 80HHC benefits, the miscellaneous incomes are required to be included in the total turnover.


M/s Nagesh Construction (P) Ltd Vs ITO, New Delhi (Dated: April 29, 2011)

Income tax – Sections 40(a)(ia), 144 – Whether TDS provisions are applicable where the outside job work charges are incurred on account of wages and site expenses.


DCIT, Mumbai Vs M/s Telco Dadajee Dhackjee Ltd (Dated: March 11, 2011)

Income Tax - Sections 254(2) & (4), 255 - Whether in view of scheme of sections 254(1), 254(2) and 255 every case adjudicated by third member should go back to the regular bench for final decisions and hence no MA lies against the order of the third member.


ITO, New Delhi Vs M/s Elka Cosmetic Pvt Ltd (Dated: April 13, 2011)

Income Tax – Sections 40(a)(ia), 35D – Whether, if assessee engaged in the business of cosmetics, incures certain expenses on 'Testers', generally used by customers

before purchase, such product promotional expenses are to be treated as capital in nature merely because it also promotes goodwill of the company.



ACIT, New Delhi Vs M/s Transceivers India Ltd (Dated: February 11, 2011)

Income Tax - Section 271(1)(c) - Whether quantum proceedings and penalty proceedings are different and the finding arrived in former cannot be sufficient to sustain the action in the latter - Whether additions in quantum proceedings can be made on the basis of probabilities but penalty can't be imposed - Whether incurring of expenses is sufficient to dislodge the penalty ignoring necessity of furnishign details of expenses.

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