[aaykarbhavan] ITR VOLUME 350 PART 5

Volume 350 Part 5 (Issue dated 4-2-2013)

SUBJECT INDEX TO CASES REPORTED IN THIS PART

SUPREME COURT

Appeal to Supreme Court --Search and seizure--Block assessment--Assessment of third persons--Conditions precedent--Satisfaction of Assessing Officer that any undisclosed income belonged to assessee or that assessee did not intend to disclose its income--Contention that such satisfaction not recorded vitiating block assessment--Cannot be taken for first time before Supreme Court--Income-tax Act, 1961, s. 158BD-- Asst. CIT v . A. R. Enterprises . . . 489

Depreciation --Conditions precedent for grant--Ownership of asset and user for purposes of business--No requirement of usage of asset by assessee himself--Vehicles purchased by assessee from manufacturer and leased to customers--Vehicles used in course of leasing business--Assessee owner of vehicle and income from lease treated as its business income--Presumption of ownership--Registration of vehicle in name of lessee under Motor Vehicles Act--Legal fiction of ownership under that Act alone--Assessee entitled to depreciation--Income-tax Act, 1961, ss. 2(13), (24), 32-- I. C. D. S. Ltd . v . CIT . . . 527

----Rate of depreciation--Higher rate for vehicles used in business of hire--Assessee in business of leasing vehicles--Entitled to depreciation at higher rate-- I. C. D. S. Ltd. v . CIT . . . 527

Principle of mutuality --Conditions for application--Members’ club--Surplus funds placed in deposit with member banks--Interest earned on deposits not covered by mutuality principle--Liable to be taxed in hands of assessee-club--Income-tax Act, 1961-- Bangalore Club v. CIT . . . 509

Search and seizure --Block assessment--Undisclosed income--Advance tax--General principles--Is paid on estimate of current income--Undisclosed income--Computation based on total income--Income-tax Act, 1961, ss. 2(45), 158B(b)-- Asst. CIT v . A. R. Enterprises . . . 489

----Block assessment--Undisclosed income--Definition--Income which would not be disclosed--Intention of assessee to disclose to be seen from facts--Where on date of search time for filing return has expired--Payment of advance tax not indicative of intention to disclose--Income-tax Act, 1961, ss. 2(45), 139, 158B(b), 158BB(3), 158BC, 158BD-- Asst. CIT v. A. R. Enterprises . . . 489

----Block assessment--Undisclosed income--Mere deduction of tax at source not disclosure of income nor indication of intention to disclose income when not disclosed in returns--Income-tax Act, 1961, ss. 158B(b)-- Asst. CIT v. A. R. Enterprises
. . . 489

Words and phrases --“Ownershipâ€--“For purpose of businessâ€-- I. C. D. S. Ltd . v. CIT . . . 527

HIGH COURTS

Advance tax --Interest--Waiver of interest--Conditions precedent--Failure to satisfy conditions--Chief Commissioner waiving one-third of interest--No further waiver of interest--Income-tax Act, 1961, ss. 234A, 234B-- K. C. Mohanan v . Chief CIT 
(Ker) . . . 461

----Underestimate or failure to estimate--Interest--Mandatory--That estimate not accurate--Not a ground to charge interest--Power of authorities to reduce interest--Assessee not filing application for waiver of interest--No opinion could be expressed whether assessee’s case is covered by circulars--Income-tax Act, 1961, s. 234C-- Bill and Peggy Marketing India Pvt. Ltd. v . Asst. CIT (Delhi) . . . 465

Reassessment --Notice--Single judge permitting assessee to file objections to notice and directing Assessing Officer to take decision after considering objections--Failure to file objections--Assessee to file objections and order to be passed after considering objections--Income-tax Act, 1961, ss. 147, 148-- Alappat Jewels v . Asst. CIT 
(Ker) . . . 471

Recovery of tax --Interest--Waiver of interest--Conditions precedent--Assessee partner in two firms and having substantial agricultural income--Payment of interest would not cause genuine hardship--That assessment was necessitated on account of addition to taxable income of firm of which assessee was a partner--Would not justify delay in payment of tax for post-assessment period--Assessee not satisfying conditions--Rejection of application for waiver of interest justified--Income-tax Act, 1961, s. 220(2A)-- K. C. Mohanan v . Chief CIT (Ker) . . . 461

Revision --Erroneous and prejudicial to Revenue--Error of Assessing Officer should be “unsustainableâ€--Assessing Officer issuing notice and holding proceedings on several dates before assessment--Assessee’s dividend income confined to receipt from investment in sister concern--Only one dividend warrant received--Nothing to show assessee spent effort or resources to earn dividend--Whether disallowance under section 14A warranted debatable--Error by Assessing Officer not “unsustainableâ€--Revision not warranted--Income-tax Act, 1961, ss. 10(33), 14A, 263-- CIT v . DLF Ltd . 
(Delhi) . . . 555

SECTIONWISE INDEX TO CASES REPORTED IN THIS PART

Income-tax Act, 1961 :

S. 2(13) --Depreciation--Conditions precedent for grant--Ownership of asset and user for purposes of business--No requirement of usage of asset by assessee himself--Vehicles purchased by assessee from manufacturer and leased to customers--Vehicles used in course of leasing business--Assessee owner of vehicle and income from lease treated as its business income--Presumption of ownership--Registration of vehicle in name of lessee under Motor Vehicles Act--Legal fiction of ownership under that Act alone--Assessee entitled to depreciation-- I. C. D. S. Ltd . v . CIT (SC) . . . 527

S. 2(24) --Depreciation--Conditions precedent for grant--Ownership of asset and user for purposes of business--No requirement of usage of asset by assessee himself--Vehicles purchased by assessee from manufacturer and leased to customers--Vehicles used in course of leasing business--Assessee owner of vehicle and income from lease treated as its business income--Presumption of ownership--Registration of vehicle in name of lessee under Motor Vehicles Act--Legal fiction of ownership under that Act alone--Assessee entitled to depreciation-- I. C. D. S. Ltd . v . CIT (SC) . . . 527

S. 2(45) --Search and seizure--Block assessment--Undisclosed income--Advance tax--General principles--Is paid on estimate of current income--Undisclosed income--Computation based on total income-- Asst. CIT v . A. R. Enterprises 
(SC) . . . 489

----Search and seizure--Block assessment--Undisclosed income--Definition--Income which would not be disclosed--Intention of assessee to disclose to be seen from facts--Where on date of search time for filing return has expired--Payment of advance tax not indicative of intention to disclose-- Asst. CIT v. A. R. Enterprises 
(SC) . . . 489

S. 10(33) --Revision--Erroneous and prejudicial to Revenue--Error of Assessing Officer should be “unsustainableâ€--Assessing Officer issuing notice and holding proceedings on several dates before assessment--Assessee’s dividend income confined to receipt from investment in sister concern--Only one dividend warrant received--Nothing to show assessee spent effort or resources to earn dividend--Whether disallowance under section 14A warranted debatable--Error by Assessing Officer not “unsustainableâ€--Revision not warranted-- CIT v . DLF Ltd . (Delhi) . . . 555

S. 14A --Revision--Erroneous and prejudicial to Revenue--Error of Assessing Officer should be “unsustainableâ€--Assessing Officer issuing notice and holding proceedings on several dates before assessment--Assessee’s dividend income confined to receipt from investment in sister concern--Only one dividend warrant received--Nothing to show assessee spent effort or resources to earn dividend--Whether disallowance under section 14A warranted debatable--Error by Assessing Officer not “unsustainableâ€--Revision not warranted-- CIT v . DLF Ltd . (Delhi) . . . 555

S. 32 --Depreciation--Conditions precedent for grant--Ownership of asset and user for purposes of business--No requirement of usage of asset by assessee himself--Vehicles purchased by assessee from manufacturer and leased to customers--Vehicles used in course of leasing business--Assessee owner of vehicle and income from lease treated as its business income--Presumption of ownership--Registration of vehicle in name of lessee under Motor Vehicles Act--Legal fiction of ownership under that Act alone--Assessee entitled to depreciation-- I. C. D. S. Ltd . v . CIT (SC) . . . 527

S. 139 --Search and seizure--Block assessment--Undisclosed income--Definition--Income which would not be disclosed--Intention of assessee to disclose to be seen from facts--Where on date of search time for filing return has expired--Payment of advance tax not indicative of intention to disclose-- Asst. CIT v. A. R. Enterprises 
(SC) . . . 489

S. 147 --Reassessment--Notice--Single judge permitting assessee to file objections to notice and directing Assessing Officer to take decision after considering objections--Failure to file objections--Assessee to file objections and order to be passed after considering objections-- Alappat Jewels v . Asst. CIT (Ker) . . . 471

S. 148 --Reassessment--Notice--Single judge permitting assessee to file objections to notice and directing Assessing Officer to take decision after considering objections--Failure to file objections--Assessee to file objections and order to be passed after considering objections-- Alappat Jewels v . Asst. CIT (Ker) . . . 471

S. 158B(b) --Search and seizure--Block assessment--Undisclosed income--Advance tax--General principles--Is paid on estimate of current income--Undisclosed income--Computation based on total income-- Asst. CIT v . A. R. Enterprises 
(SC) . . . 489

----Search and seizure--Block assessment--Undisclosed income--Definition--Income which would not be disclosed--Intention of assessee to disclose to be seen from facts--Where on date of search time for filing return has expired--Payment of advance tax not indicative of intention to disclose-- Asst. CIT v. A. R. Enterprises 
(SC) . . . 489

----Search and seizure--Block assessment--Undisclosed income--Mere deduction of tax at source not disclosure of income nor indication of intention to disclose income when not disclosed in returns-- Asst. CIT v . A. R. Enterprises (SC) . . . 489

S. 158BB(3) --Search and seizure--Block assessment--Undisclosed income--Definition--Income which would not be disclosed--Intention of assessee to disclose to be seen from facts--Where on date of search time for filing return has expired--Payment of advance tax not indicative of intention to disclose-- Asst. CIT v. A. R. Enterprises 
(SC) . . . 489

S. 158BC --Search and seizure--Block assessment--Undisclosed income--Definition--Income which would not be disclosed--Intention of assessee to disclose to be seen from facts--Where on date of search time for filing return has expired--Payment of advance tax not indicative of intention to disclose-- Asst. CIT v. A. R. Enterprises 
(SC) . . . 489

S. 158BD --Appeal to Supreme Court--Search and seizure--Block assessment--Assessment of third persons--Conditions precedent--Satisfaction of Assessing Officer that any undisclosed income belonged to assessee or that assessee did not intend to disclose its income--Contention that such satisfaction not recorded vitiating block assessment--Cannot be taken for first time before Supreme Court-- Asst. CIT v . A. R. Enterprises (SC) . . . 489

----Search and seizure--Block assessment--Undisclosed income--Definition--Income which would not be disclosed--Intention of assessee to disclose to be seen from facts--Where on date of search time for filing return has expired--Payment of advance tax not indicative of intention to disclose-- Asst. CIT v. A. R. Enterprises 
(SC) . . . 489

S. 220(2A) --Recovery of tax--Interest--Waiver of interest--Conditions precedent--Assessee partner in two firms and having substantial agricultural income--Payment of interest would not cause genuine hardship--That assessment was necessitated on account of addition to taxable income of firm of which assessee was a partner--Would not justify delay in payment of tax for post-assessment period--Assessee not satisfying conditions--Rejection of application for waiver of interest justified-- K. C. Mohanan v . Chief CIT (Ker) . . . 461

S. 234A --Advance tax--Interest--Waiver of interest--Conditions precedent--Failure to satisfy conditions--Chief Commissioner waiving one-third of interest--No further waiver of interest-- K. C. Mohanan v . Chief CIT (Ker) . . . 461

S. 234B --Advance tax--Interest--Waiver of interest--Conditions precedent--Failure to satisfy conditions--Chief Commissioner waiving one-third of interest--No further waiver of interest-- K. C. Mohanan v . Chief CIT (Ker) . . . 461

S. 234C --Advance tax--Underestimate or failure to estimate--Interest--Mandatory--That estimate not accurate--Not a ground to charge interest--Power of authorities to reduce interest--Assessee not filing application for waiver of interest--No opinion could be expressed whether assessee’s case is covered by circulars-- Bill and Peggy Marketing India Pvt. Ltd. v. Asst. CIT (Delhi) . . . 465

S. 263 --Revision--Erroneous and prejudicial to Revenue--Error of Assessing Officer should be “unsustainableâ€--Assessing Officer issuing notice and holding proceedings on several dates before assessment--Assessee’s dividend income confined to receipt from investment in sister concern--Only one dividend warrant received--Nothing to show assessee spent effort or resources to earn dividend--Whether disallowance under section 14A warranted debatable--Error by Assessing Officer not “unsustainableâ€--Revision not warranted-- CIT v . DLF Ltd . (Delhi) . . . 555

 

Regards

Prarthana Jalan

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