Tuesday, September 30, 2014

[aaykarbhavan] Judgments and Information [2 Attachments]






2012-TIOL-797-ITAT-MUM
Pfizer Ltd Vs ACIT (Dated: October 19, 2012)
Income Tax – Sections 234B, 234C, 234D - Whether the assessee is liable to pay
interest u/s 234B where the tax liability increased owing to circumstances beyond its
control.
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ACIT Vs M/s Sterling Infotech Ltd (Dated: July 30, 2012)
Income Tax – Sections 14A, 143(1), 147 – Reassessment - Disallowance - Whether
the cross-objection on reopening of assessment can be raised before Tribunal when
the same was not raised before the AO and CIT(A) - Whether the reopening of
assessment to recompute the losses based on submissions available at time of original
assessment is valid.

The Commissioner of Income Tax Versus TVS Finance and Services Ltd. (formerly known as Harita Finance Ltd.) – Income Tax – MADRAS HIGH COURT – HC – Depreciation on sale and lease back transaction – Not for sale sign affixed on assets – Financial Transaction OR sale and lease back agreement – Held that:- The sale was on payment of sales tax and the assessee has received the lease amount and disclosed the same as business income – the Tribunal has rightly held that the assessee is the owner of the machinery and the machinery was used for its leasing business in the AY, thus, they are eligible for depreciation – Relying upon Commissioner of Income-tax v. High Energy Batteries (India) Ltd. [2012 (5) TMI 287 - MADRAS HIGH COURT] – there is no material produced by the Revenue to show that the transaction of sale and lease back was not genuine or was bogus – thus, no substantial question of law arises for consideration – Decided against Revenue. – 2014 (7) TMI 692 – MADRAS HIGH COURT – TMI – T. C. (A). No. 44 of 2014 – - Dated:- 14-7-2014 – R. Sudhakar And G. M. Akbar Ali,JJ. For the Appellant : Mr. Arun Joseph Kurian Standing Counsel ORDER (Delivered by R. Sudhakar, J.) The appeal has been filed by the Revenue challenging the order of the Income Tax Appellate Tribunal Chennai 'A' Bench, dated 30.9.2013 made in ITA No.1965/Mds/2012 for the assessment year 1996-1997, by raising the following substantial questions of law: 1. Whether on the facts and circumstances of the case the Tribunal was right in upholding the order of CIT(A) in allowing depreciation on sale and lease back transaction with Hightemp Furnace Ltd., especially when not for sale sign was affixed on the assets? 2. Is not the finding of the Tribunal bad, especially when the transaction of the assessee was purely a financial transaction structured under the name of sale and lease back agreement? 2. The assessee in this case is a finance company and in the course of business, they entered into an Sale and Lease back agreement with the manufacturer of a machinery, namely, Hightemp Furnace Ltd., to acquire ownership of machinery for consideration and thereafter lease the said machinery to Hightemp Furnace Ltd. The machinery was manufactured by Hightemp Furnace Ltd. and sold to the assessee and on the transaction, sales tax was levied and collected from the assessee and paid out to the Government. On the leased out machinery, the assessee received rental income and it was disclosed in the returns as business income of the assessee. The Assessing Officer has also accepted the lease amount as business income of the assessee. The assessee in this case claimed depreciation on the machinery so leased out to Hightemp Furnace Limited, but the same was disallowed by the Assessing Officer primarily relying upon the Central Excise document, where it was shown that the machinery is not for sale. 3. Aggrieved by that portion of the assessment order declining to grant the benefit of depreciation, the assessee moved the Commissioner of Income Tax (Appeals). The Commissioner of Income Tax (Appeals) conside…………


Search and seizure€ ¢â' '´New scheme of assessment in search cases€ ¢â' '´Validity of Search proceedings€ ¢â' '´CIT(A) held that valid search was conducted u/s 132, in case of Respondent-Assessee€ ¢â' '´Held, perusal of Panchnama shows that name of Assessee was mentioned in Panchnama, place had been identified categorically as Bank account€ ¢â' '´On specific direction to CIT, DR, assessee showed copy of warrant to Bench€ ¢â' '´Warrant contained name of Assessee and Bank account number and Branch name, etc.€ ¢â' '´Moreover, when Assessee was challenging warrant to be illegal, then it was required to be challenged by filing affidavit alleging same€ ¢â' '´Such affidavit had not been filed in any of Cross Objections in bunch of appeals€ ¢â' '´Search had validly been conducted on Assessee€ ¢â' '´AO legally assumed jurisdiction for issue of notices u/s 153A for the six Assessment years



Department cannot initiate proceedings when assessee had time to fulfil statutory obligations

 Bharat Enterprises Vs. The Commissioner of Customs (Seaport-Export) [2014 (9) TM! 579- Madras High Court]
In the instant case, Bharat Enterprises (the Petitioner) filed a writ petition before the Hon'ble Madras High Court challenging the Order passed by the Revenue wherein it was alleged that the Petitioner had not fulfilled the export obligations as were required under the license issued to the Petitioner within the stipulated period of 8 years. Therefore, the Petitioner was directed to pay duty amount of Rs. 5,11,350/-under the Customs Act, 1962 (the Customs Act).
The Hon'ble Madras High Court observed that the Petitioner was granted a time period of 8 years to fulfil the export obligations. However, the Department had initiated the proceedings before the expiry of stipulated period of 8 years. Therefore, the Hon'ble High Court held that initiation of proceedings in such a case was completely arbitrary and faulty. It was further held that proceedings should only have been initiated if the Petitioner had not fulfilled the export obligations as per the license conditions and commencement of proceedings before the end of stipulated time period would lead to failure of substantial justice. Accordingly, the demand raised against the Petitioner was set aside.
(Bimal Jain, FCA, FCS, LLB, B.Com (Hons), Mobile: +91 9810604563, Email: bimaljain@hotmail.com)
- See more at: http://taxguru.in/custom-duty/department-initiate-proceedings-assessee-time-fulfil-statutory-obligations.html#sthash.568KhKHn.dpuf


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Posted by: Dipak Shah <djshah1944@yahoo.com>


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