News Update

SC tosses out Chanda Kochhar’s petition questioning her removal from ICICI MD’s postGST collection crosses Rs 1 lakh crore in NovemberBoard of Trade meeting to discuss foreign trade policy, Atmanirbhar BharatJob Work - RedefinedST - New pleas can be raised for the first time before the Appellate Authority, if it is established that such grounds are bona fide and were not raised earlier for good reasons: CESTATTerrorism most important challenge faced by the region: India at SCOAdmission of additional evidences by CIT(A) without providing an opportunity of being heard to the AO while finalising the Block Assessment, is invalid: HCWhere a research project relating to scientific development, has received approval as per Rules 18D & 18DA of the I-T Rules, it is not open to the AO to question the approval so granted: HCRe-assessment proceedings are invalid if notice u/s 143(2) is issued beyond the prescribed statutory limit: ITAT30 lakh paddy farmers benefit from Kharif Marketing Season Procurement OperationsExpenditure incurred on replacement of Jigs and fixtures qualifes as revenue expenditure: ITATKVIC Honey Mission helps UP migrant workers earnDighawara-Bandikui railway route electrified between Ajmer and DelhiMilling of paddy - By-products form part of compensation but not consideration - Value of broken rice, bran and husk cannot, therefore, be treated as part of the consideration for levy of GST: HCGST - Orders of public servants, some of whom are quasi judicial authorities, which have far reaching effect on the life, liberty, property and welfare of the public must be based on cogent reasons: HCCAROTAR Rules, 2020 - Is the remedy worse than the disease? (See 'THE INSIGHT' in seeks suggestions on regulatory process from teams working on COVID-19 vaccineRole of human scorer is a means to ensure reliability of specialised computer program called Automated Essay Scoring (AES), therefore, involvement of human element is well within realm of 'minimum human intervention' - Type-3 test is also an OIDAR service: AAARStoring finished goods in outside godowns - In current era of liberalisation and simplification of law and procedures, recovery of MOT is no longer warranted - refund ordered with interest: HCIncome tax raids IT SEZ developer; searches 16 premises in Chennai, Mumbai & HyderabadCommon businessman is admittedly having difficulty to understand GST Act and the procedures they have introduced - Interpretation should be done in a way to facilitate business and not in a perverse manner: HCGovt grants Rs 900cr to accelerate COVID-19 vaccine developmentDisallowance of R&D expenses claimed u/s 35(2AB) is untenable, where no reasons are recorded in respect of such claims: HCIncome tax raids IT SEZ developer; seaches 16 premises in Chennai, Mumbai & Hyderabad 
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November 30, 2020

++ Power of revision u/s 263 cannot be exercised solely because in original assessment order, AO relied upon precedent judgment which was subsequently reversed: HC

++ Disallowance of R&D expenses claimed u/s 35(2AB) is untenable, where no reasons are recorded in respect of such claims: HC

++ Failure to comply with directions in notice issued u/s 142(1) is a technical default at best & for which penalty u/s 271(1)(b) cannot be imposed: ITAT

++ Registration u/s 12AA cannot be denied to Trust where its objectives are undisputedly charitable in nature & if all records of corpus donation received & assets purchased, are submitted: ITAT

November 28, 2020

++ Re-assessment proceedings are vitiated where assessee is not provided with reasons for initiating the same: ITAT

++ Where assessee jointly owned another property on date of transfer of asset, claim for exemption u/s 54F cannot be rejected in respect of capital gains earned from transfer of solely owned property: ITAT

November 27, 2020

++ Waiver of interest by IREDA cannot be considered as withdrawal of provision and is not to be reduced from the book profit: HC

++Assessment order passed with making proper inquiry is erroneous & prejudicial to Revenue's interest - power of revision u/s 263 is correctly exercised: ITAT

++ Penalty notice is invalidated if it omits to specify the exact charges against the assessee, as laid down in the relevant sub-sections of Section 271(1)(c): ITAT

++ CIT(A) cannot summarily dismiss appeals for non-prosecution & is obligated to pass orders on merits: ITAT

++ Incomes which are inextricably linked with carrying of business are also derived from business hence eligible for deduction: ITAT

November 26, 2020

++ I-T - High Court failed to exercise powers under Art 226, by relegating assessee to appellate remedy while also giving liberty to raise issue contesting validity of a provision of I-T Act, at 'appropriate moment': SC LB

++ Additions framed u/s 69A on account of unexplained jewellery are unsustainable, if based solely on minor mis-match in jewellery found in course of Search operations: ITAT

++ Disallowance of any claim made by the assessee would not mechanically attract imposition of penalty u/s 271(1)(c): ITAT

++ Search assessment u/s 153C cannot be resorted to where no documentary evidence incriminating the assessee are found in course of Search proceedings: ITAT

November 25, 2020

++ Penalty notice is invalidated if it does not specify the particular provision of Sec 271AAA, invoked in respect of undisclosed income for which penalty is being imposed: ITAT

++ CIT(A) is empowered to entertain a fresh claim raised by the assessee, where the relevant facts for deciding upon such issue are available on record: ITAT

++ Additions framed are unsustainable, if based on documents which do not pertain to the assessee or his accounts & so are not binding on & cannot be used as evidence against the assessee: ITAT

November 24, 2020

++ Re-assessment proceedings cannot be resorted to in order to conduct inquiries of a roving nature: ITAT

++ Statements recorded during Survey proceedings have no evidentiary value unless corroborated with circumstantial evidences: ITAT

++ Re-assessment proceedings are vitiated if notice u/s 143(2) has not been issued beforehand: ITAT

++ If the capital of a company is fruitfully utilised instead of keeping it idle, the income thus generated, will be of a revenue nature and not accretion of capital: ITAT

November 23, 2020

++ Exemption u/s 11 cannot be denied to a trust, solely because that portion of income which had been taken away by deduction of tax at source, had not been spent or utilised for charitable purposes: ITAT

++ Delivery of goods received by an agent of the assessee, on behalf of such assessee, is to be treated as delivery by the assessee itself & any such transaction does not become bogus transaction: ITAT

++ Additions on account of undisclosed income cannot be framed solely on the basis of statements taken from a third party, where such statements are not corroborated by any evidence: ITAT

November 21, 2020

++ Approval u/s 80G cannot be denied to a society engaged in imparting education, solely because it earned interest from Fixed Deposit receipts, more so where it has no history of receiving donations: ITAT

++ Penalty notice is void if it does not specify the exact charges against the assessee between concealment or the furnishing of inaccurate particulars of income: ITAT

++ Amount paid to an educational institute for securing admission of assessee's ward, cannot be deemed as routing of unaccounted income, if no evidence is put forth to prove such allegation: ITAT

++ Re-assessment proceedings cannot be initiated in respect of any amount which neither accrues nor arises in the hands of an assessee: ITAT

November 20, 2020

++ Benefit u/s 36(1)(viii) is allowed to a public bank which also falls within the ambit of the term 'Financial Corporation: HC

++ High Court's intervention is unwarranted in respect of an appeal challenging factual findings, unless such findings are shown to be perverse in any manner: HC

++ In case of suppression of Gross Profit on certain purchases made, addition is to be framed in respect of the profit element embedded therein: ITAT

++ Typographical mistake or minor procedural lapse are no grounds to deny statutory benefit to which an assessee is otherwise eligible, unless the statute itself lays down the conditions for claiming benefit or unless there is infringement of statutory provisions: ITAT

November 19, 2020

++ Difference of opinion between assessee & the Revenue, over the true nature of a certain transaction & its appropriate classification, is not tantamount to furnishing inaccurate particulars of income - imposing penalty unwarranted: HC

++ Deduction is allowed in respect of expenditure incurred on account of leave salary paid by employer to employees: HC

++ Re-assessment proceedings are void where initated by an AO not vested with the jurisdiction to do so: ITAT

++ An inadvertent error committed by an assessee is not reasonable cause to impose penalty, in absence of gross negligence or mala fide intent on part of assessee: ITAT

November 18, 2020

++ Penalty cannot mechanically be imposed solely because assessee erroneously made a wrong claim: ITAT

++ LTCG declared by assessee cannot be deemed to be illicit, where the transactions from which such receipts arise, are not in doubt: ITAT

++ Proceeds from sale of shares classified as investment by the seller, are treatable as income from Short Term Capital Gain: ITAT

November 17, 2020

++ Additions u/s 68 cannot be sustained based solely on third party statement, when opportunity for cross examination is not given: ITAT

++ Re-assessment proceedings cannot be resorted to based solely on information received from Investigation Wing - additions for unexplained cash credit based exclusively on third party statements, are unsustainable: ITAT

++ Exemption u/s 54 in respect of an under-construction property, cannot be denied just because completion certificate of such property is not produced: ITAT

++ Additions framed for unexplained credit are reduced in quantum, where assessee does not disclose proceeds from sale as its income & while AO too does not adequately inquire into such income: ITAT

November 16, 2020

++ I-T - An amalgamated company can claim depreciation u/s 32 on goodwill of the amalgamating company, which emerges in the books of the amalgamated company: ITAT

++ Assessee's income cannot be enhanced based on documents which were already in the possession of the Revenue & where no new documents are recovered: ITAT

November 13, 2020

++ Addition u/s 68 is not sustainable when assessee has furnished all information sought for by the AO for verification of share application money received: ITAT

++ Late fee u/s 234E cannot be levied prior to amendment to section 200A(1)(c) of the Act by Finance Act, 2015 w.e.f. 1.06.2015 while processing the TDS returns: ITAT

November 12, 2020

++ Best of judgment assessment order merits being set aside where it is not preceded with service of SCN to the assessee: HC

++ Penalty levied u/s 271AAB is invalid when the SCN does not specify the charge on which the penalty is imposed: ITAT

++ Deduction u/s 54B is allowed to assessee, in respect of agricultural land purchased in the name of the assessee's son & daughter-in-law: ITAT

++ Additions framed on account of unexplained income are unsustainable where an assessee did not earn income for a brief period, but resumed generation of income thereafter: ITAT

November 11, 2020

++ Remedial provisions of Section 292BB are inapplicable in cases of non-issuance of proper notice u/s 143(2): HC

++ It is open for an assessee to change its method of accounting - burden is on Department to prove that the method invoked is incorrect & leads to distortion of profits of a particular AY: HC

++ Income which relates to the business of providing credit facilities to its members will be eligible for deduction u/s 80P(2)(a)(i): ITAT

++ Registration of a Trust u/s 12A once done is a fait accompli and the AO cannot thereafter probe into the objects of the Trust: ITAT

November 10, 2020

++ Mortgage charge & expenditure incurred on stamp duty in process of availing loan for acquiring capital asset are allowed as revenue in nature: ITAT

++ Financial transactions between two sister concerns, made due to business expediency cannot be termed as loans or advances for the purpose of invoking Section 2(22)(e): ITAT

++ Contract for developing/providing Lift Irrigation Scheme/ Lift Water Supply Scheme, fall with the scope and purview of infrastructure development facility eligible for deduction u/s 80IA: ITAT

November 09, 2020

++ Recovered bad debts of a bank do not partake character of deemed income in the year of receipt in terms of Section 41(4) & hence are not taxable: ITAT

++ For invoking provisions of Section 36(1)(ii) upon touchstone of evasion, complete details of tax avoided by the assessee must be provided: ITAT

++ Goodwill & customer contracts duly recorded in the audited financials are eligible for depreciation, being intangible assets u/s 32(1)(ii): ITAT

++ AO is not empowered to process those returns which already have been declared invalid: ITAT

November 07, 2020

++ Disallowance framed u/s 14A cannot be framed when no exempt income is earned in the relevant AY: ITAT

++ Additions framed on account of steep fall in Gross Profit, are upheld where no reasonable explanation is furnished by assessee for the same: ITAT

November 06, 2020

++ Pre-deposit amount payable by assessee for stay on recovery of demand, can be adjusted against refunds payable to assessee, where assessee is facing financial stringency & is unable to pay pre-deposit amount: ITAT

++ Additions cannot be framed on basis of some perceived gains arising from a contract entered into by the assessee, where such contract is never fulfilled: ITAT

November 05, 2020

++ Penalty imposed on assessee without stating the specific charges against the assessee between concealment of particulars of income or furnishing inaccurate particulars thereof, is unsustainable: ITAT

++ Additions cannot be framed on basis of some perceived gains arising from a contract entered into by the assessee, where such contract is never fulfilled: ITAT

++ Interest received from the Cooperative Bank/Society is eligible for deduction under section 80P(2)(d): ITAT

++ Re-assessment order is invalidated if passed without disposing off the assessee's objections to such proceedings: ITAT

November 04, 2020

++ Penalty - AO is obligated to specify exact charges against the assessee, between concealment of income or furnishing inaccurate particulars of income: ITAT

++ Power of revision is not to be exercised in respect of an issue examined in original assessment as well as in re-assessment proceedings: ITAT

++ Deduction on account of bad debt as allowed u/s 36(l)(vii) r/w section 36(2), can be allowed by wiring off the debt as irrecoverable in accounts of assessee: ITAT

++ Assessee's books of accounts cannot be rejected u/s 145(3) without pointing out any defect or deficiency therein: ITAT

November 03, 2020

++ CIT(A) & ITAT are empowered to consider any specific plea raised by assessee - any such issue cannot be overlooked by both authorities, solely because it was not also raised before the AO: HC

++ CIT(A) & ITAT are empowered to consider any specific plea raised by assessee - any such issue cannot be overlooked by both authorities, solely because it was not also raised before the AO: HC

++ Addition for unexplained cash credit cannot be made merely based on third party information without conducting any investigation or enquiry in respect of information submitted by assessee: ITAT

++ Bogus purchases made by an assessee can be disallowed in entirety when corresponding sales made by the assessee have not been doubted: ITAT

November 02, 2020

++ Disallowance of expense incurred on account of sales rebate, is not tenable, if the AO is unsure of the true nature of such amount: ITAT

++ Payment received for sale of specialised software & for providing maintenance & support service, cannot be treated as payment of royalty: ITAT

++ Penalty for non-deduction of TDS cannot be imposed if the assessee is in bonafide belief for its non-deduction: ITAT

++ Expenditure incurred on R&D of a product which is required to be supplied to a particular customer qualifies as Revenue expenditure: ITAT