The following important judgements are available for download at itatonline.org.
Parkar Medical Foundation vs. DCIT (ITAT Pune)
S. 254(2B): Even though action of the CIT in canceling registration u/s 12AA(3) is illegal, costs cannot be awarded as the said action is in discharge of duty & not mala fide
(ii) The CIT has passed the order u/s 12AA(3) of the Act during the course of discharge of her duty as CIT. While discharging her duty, her action might have caused some hardship to the assessee due to error of judgement but that in our opinion does not warrant levy of cost on the department. In Pooran Mal vs. Director 93 ITR 505 (SC), it was noted that s. 132 causes serious invasion of the privacy of a person. Still it was held that even though the innocent is likely to be harassed by a raid for the purpose of search and seizure, that cannot be helped. In the instant case, there is no such action of search and seizure which causes serious invasion in the privacy of the person. The CIT was discharging her quasi-judicial duty. Further, there is nothing on record to suggest that the action of the CIT was mala fide. Therefore, there is no merit in the claim for award of costs for the action of the CIT in cancelling the registration granted earlier u/s 12AA of the Act (UOI vs. Raja Mohammed Amir Mohammad Khan (SC), Urban Improvement Trust, Bikaner vs. Mohanlal (2010) (1 SCC 512) (SC) & Charanjilal Tak Shyam Parwani vs. UOI 252 ITR 333 (Raj) distinguished)
Kohinoor Foods Ltd vs. ACIT (ITAT Delhi)
Transfer pricing implications of interest-free loans, corporate guarantee & export turnover adjustments explained
(i) Interest free loans to AEs: We have no issue of the TPO applying the CUP method. But the problem arises when in the name of applying CUP method; a wholly inapplicable comparable model applied which leads to distorted results. A significant sector of multi-national corporate set up involves creation of subsidiaries and associate enterprises for advancement of their overseas business. They help them in terms of finance by offering soft loans and subsidiary loans; they are primary focused to spread the business of the principal unit. It would have been very reasonable, judicious and appropriate on the part of the TPO to have looked into such type of transactions and applying it as uncontrolled transactions. Re-course straightaway to CRISIL, which deals in hardcore institutional finance transactions that too with clear commercial object of earning out of loans bereft on other considerations, is wholly inapplicable. While the real income theory has no application to a fictional working as provided by section 92 but this being part of the Income-tax Act, the valid consideration for properly assessing a transaction cannot be given a go by. Every fiction has limits to its application. In view thereof, the rate of 13.49% applied solely relying upon a third party opinion by applying on uncontrolled set of transaction is factually not correct and cannot be accepted. The correct comparable which can be applied is of LIBOR rate which is internationally recognized. It is the most appropriate comparable for the relevant periods and being reasonable and scientific uncontrolled comparable to be applied to the assessee's loan transactions
ITO vs. Ram Prakash (ITAT Agra)
S. 133A: No addition can be made on the basis of a surrender simplictor even if the surrender is during the course of s. 133A survey proceedings
The issue raised is infructuous inasmuch as even if the surrender is in order but the addition was not warranted on merits, it is only elementary that merely because the assessee has, under misconception of facts or law, surrendered an income, no addition can be made in respect of the same. We have also noted that as evident from the observations of even the AO, there were no specific reasons for making the addition of Rs 10,00,000 save and except for the alleged surrender made by the assessee. The issue in appeal is also covered, in favour of the assessee, by a coordinate bench of this Tribunal in ACIT vs. Satya Narayan Agarwal (91 TTJ 481) wherein it is held that no addition can be made on the basis of a surrender simplictor even when surrender is made during the course of survey proceedings under section 133 A.
Regards,
Editor,
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Latest:
Monthly (April 2014) + Consolidated (Jan to April 2014) Digest Of Imp Case Laws
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