Blog

CIT vs Reliance Life Insurance Co. Ltd.

TDS not payable on outsourcing expenses which are for clerical services

In the case of CIT vs Reliance Life Insurance Co. Ltd., the Bombay High Court has held that TDS is not payable on outsourcing expenses which are clerical in nature. Revenue’s Arguments: The Revenue argued that the assessee had deducted tax under Section 194C of the act which was related to payments made to contractor … Continue reading TDS not payable on outsourcing expenses which are for clerical services

DCIT vs Bhaijee Portfolio Pvt. Ltd.

Reassessment proceedings without approval is illegal

In the case of DCIT vs Bhaijee Portfolio Pvt. Ltd. the Income Tax Appellate Tribunal’s Delhi bench has held that the re-opening of an assessment without the approval of designated authority is not allowable under Income Tax Act. Revenue’s Arguments: The re-assessment proceeding was initiated by the Assessing Officer against the Assessee by recording reasons … Continue reading Reassessment proceedings without approval is illegal

Ravi Jain vs ACIT case summary and update

Capital gain exemption to be given to more than one house, when HUF property is sold

The Delhi bench of ITAT has held in the case of Ravi Jain vs ACIT that when an HUF’s residential house is sold, the capital gain can be invested for the purchase of more than one residential house and the benefit of exemption cannot be denied under s. 54(1) of the IT Act. Assessee’s Arguments: … Continue reading Capital gain exemption to be given to more than one house, when HUF property is sold

Case update - DCIT vs BMR

Remuneration paid to Director independent of shareholding cannot be considered dividend

The Delhi bench of ITAT has held in the case of DCIT vs BMR Business Solutions Pvt. Ltd. that the remuneration paid to the Director of a company commensurate with his experience which has no bearing on his shareholding, cannot be considered ‘dividend’ under the Income Tax Act. Revenue’s Arguments: The revenue argued that as … Continue reading Remuneration paid to Director independent of shareholding cannot be considered dividend

Subscription fee paid to access online database is in the nature of business income

The Mumbai bench of the ITAT has held in the case of Elsevier Information Systems vs. DCIT that the subscription fee paid to access an online database would amount to business income and not royalty or fees for technical services. Revenue’s Arguments: The AO held that providing access to a curated online database of was … Continue reading Subscription fee paid to access online database is in the nature of business income

Rehlan constryction vs. ACIT

Possibility of personal use cannot be a reason to disallow depreciation claim

The Income Tax Appellate Tribunal’s Delhi bench has held in the case Ralhan Construction Company vs. ACIT that the mere possibility of personal use would have no role to play while granting depreciation on any vehicle under Section 32 of the Income Tax Act, 1961. Revenue’s Actions: In the present case, since the assessee had … Continue reading Possibility of personal use cannot be a reason to disallow depreciation claim

Addition made to the income of the assessee (without cross-examination) cannot be sustained

In the case of Shakuntala Agencies Pvt. Ltd. vs. ITO, search and seizure operations at the premise of a third party uncovered incriminating material related to the assessee. The AO and CIT(A) both rejected the assessee’s request to cross examine the relevant person.Tribunal holding: Addition made to the income of an assessee on the basis of … Continue reading Addition made to the income of the assessee (without cross-examination) cannot be sustained

Broadcast companies not liable to pay TDS on Channel Placement Fees

ASIANET NEWS NETWORK P.LTD MUMBAI vs ASST CIT CIR 16(1) MUMBAI The Mumbai bench of the Income Tax Appellate Tribunal has held in the case of Asianet News Network vs. ACIT that channel placement fee paid by the broadcast company would not be liable to be disallowed u/s 40(a)(ia) as there is no obligation on … Continue reading Broadcast companies not liable to pay TDS on Channel Placement Fees

Revisional Jurisdiction cannot be exercised on issues which have not been covered in Reassessment

Gulab Badgujar (HUF) Thane vs Commissioner of Income-tax (Central) The Pune bench of the Income Tax Appellate Tribunal in the case of Gulab Badjugar vs. CIT has held that an issue which was not covered in the reassessment proceedings would not be available for readjudication under revisional jurisdiction. The Tribunal noted that once the re-assessment … Continue reading Revisional Jurisdiction cannot be exercised on issues which have not been covered in Reassessment