France, not India, is entitled to Rs 650 crore in capital gains tax from Shantha deal: Andhra High Court

The Andhra Pradesh High Court has ruled that France, not India, is entitled to Rs 650 crore in capital gains tax arising from the sale of Hyderabad-based Shantha Biotech to Sanofi Aventis. The judgement is likely to have a calming effect on foreign investors wary about India's stance on taxing offshore transactions.

Arun Shungloo Trust Vs. CIT (Delhi High Court)

Whether Explanation (iii) to Section 48 of the Act can be interpreted without considering the effect of Section 49(1) Explanation and Explanation 1(i)(b) of Section 2 (42A), when all three sections relate to the same subject matter of computation of capital gains on the sale of a capital asset, description of the previous owner and the period of holding of the asset by the assessee.

Mr.Arun Shungloo transferred the property to the trust managed by the appellant, i.e., Arun Shungloo Trust. The said asset was later sold by the appellant in AY 2001-02, issue which aroused from Revenue is whether to include the period of holding of previous owner while calculating Capital Gains or not. 

CIT Vs. Sasan Power Ltd. - Delhi High Court

Revenue has filed the present appeal in respect of disallowance of interest expense of Rs.1,36,11,665/- which was received by the assessee from its Holding Company before starting any production or manufacture. The Assessing officer assessed the said amount as Income of the assessee; however, the assessee has deducted the said amount from Capital Work-in progress. On appeal to CIT(A), the additions by AO was  deleted. The view of CIT(A) was upheld by the Tribunal. Held by court that there was no substantial question of law arises from the order of the tribunal. The appeal is dismissed.

Chadha Sugars Pvt. Ltd. Vs. ACIT - ITAT Delhi

The assessee obtained the opinion of a Chartered Accountant on whether expenditure on fees to the Registrar of Companies for increasing authorized capital can be claimed as revenue expenditure. The CA relied on judicial precedents and opined that the issue was debatable and a claim could be made on the basis that if two views were possible, the view in favour of the assessee should be taken. The assessee claimed deduction and even the tax auditor did not qualify the same. The AO relying on Punjab State Industrial Development Corp 225 ITR 792 (SC) & Brooke Bond 225 ITR 798 (SC) disallowed the claim and levied s. 271(1)(c) penalty which was upheld by the CIT (A). Before the Tribunal, the assessee pleaded that as it had relied on the opinion of an expert in making the claim, its action was bona fide & penalty could not be levied. HELD dismissing the appeal.


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Doshion Ltd vs. ITO - Gujarat High Court

For the assessment year 2005-06, the assessee filed its return of income declaring total income of Rs.2.04 crores( rounded off). In the return filed, the assessee had claimed deduction of Rs.2.22 crores under Section 80IA of the Act and also of Rs.3.82 crores under Section 80IB of the Act. The petitioner, however, subsequently filed a revised return and revised its total income to Rs.2.87 crores claiming deduction of Rs.2.11 crores under Section 80IA of the Act and Rs.3.10 crores under Section 80IB of the Act. After thorough scrutiny the Assessing Officer granted the deduction, particularly, that claimed by the assessee in its revised return with respect to Section 80IA of the Act.

Vodafone hails SC verdict, says it has confidence in India

UK-based Vodafone Group Plc, the parent company of Vodafone Essar, on Friday hailed the Supreme Court's ruling to set aside the Bombay high court judgement asking the company to pay income tax of Rs.11,000 crore.

Vodafone which is the second largest telecom operator in India, said judgement underpins its confidence in the country.

"We welcome the Supreme Court's decision, which underpins our confidence in India. We will continue to grow our Indian business - including making significant investments in rural areas and in 3G network coverage - for the benefit of Indian consumers," Vodafone CEO Vittorio Colao said in a statement.

CIT Vs. Visual Technologies India Private Limited

The question relates to deduction of Rs.83,60,017/- claimed by the assessee under Section 80IC of the Act. The Tribunal has upheld the findings of CIT(A) that the new industrial undertaking set up by the assessee in the assessment year 2005-06 at Dehradun  qualifies for deduction under Section 80IC of the Act. The CIT(A) in its order dated 1st May, 2009 did not examine the question of quantum of deduction under Section 80IC and the same has not been considered by Tribunal. Thus the matter has been referred back to Tribunal to decide on the quantum of deduction.

Commissioner of Service Tax Vs. BAS Engineering Private Limited

The order of Tribunal was erroneous in deleting/quashing penalty under Section 78 of the Finance Act 1994 on the ground that the show cause notice did not grant any opportunity of rebuttal to the respondent-assessee to defend the penalty under the said Section, though the two corrigendums show cause notices were issued calling upon and asking the assessee to give its explanation as to why the penalty under Section 78 of the Finance Act should not be imposed. It will be open to the assessee to dispute that the corrigendum was issued or was issued after the limitation period or was not served.

CIT Vs. Jagtar Singh - Punjab & Haryana High court

Under Section 68 of the Act, where any amount is found credited in the accounts of the assessee relating to any previous year, the same can be charged to income tax as the income of the assessee of that year where the explanation offered by the assessee about the nature and its source is not satisfactory in the opinion of the assessing officer.

HCL CORPORATION LIMITED Vs. ACIT - Delhi High Court

The present writ petition is in respect of the assessment year 2004-05. The petitioner is aggrieved by the fact that the assessment in respect of the said assessment year is sought to be re-opened by the Assessing Officer by invoking the provisions of section 147 of the Income Tax Act, 1961. The Court is of the view that the petitioner had fully and truly disclosed all the material facts necessary for the purposes of assessment. Since the notice under section 148 was issued beyond the period of four years the notice and all proceedings pursuant thereto would be contrary to law.  As such the impugned order as also the notice under section 148 are set aside and any proceeding pursuant thereto are also set aside.

Girnar Investment Ltd vs. CIT - Delhi High Court

The AO passed an assessment order and raised a demand of Rs. 21.24 lakhs of which Rs. 10.50 lakhs was paid by the assessee and the balance of Rs. 10.94 was stayed. On 20.5.1998, the CIT (A) allowed the appeal of the assessee and no demand remained payable by the assessee. The AO refunded the taxes paid by the assessee. Subsequently, the Tribunal reversed the CIT (A). The AO gave effect to the Tribunal’s order on 30.7.2004 and charged interest u/s 220(2) for the entire period. The assessee filed a Writ Petition claiming that it was not liable to pay interest for the period from 20.5.1998 to 30.7.2004 (6y 3M) when the CIT(A)’s order was operative and no sum was due from it. HELD by the High Court:

Amrapali International Vs. ACIT - Delhi Tribunal

Assessing Officer has made the disallowances of lumpsum 80% and 75% and Ld. Commissioner of Income Tax (Appeals) has sustained the same also.  Such disallowances based on estimate basis without bringing on record any cogent reasons, are not sustainable. Hence, Tribunal set aside the orders of the authorities on this issue and decide the issue in favour of the assessee.

CIT vs. SPL’s Siddhartha Ltd - Delhi High Court

The AO issued a notice u/s 148 to reopen an assessment. As a s. 143 (3) order had not been passed & 4 years had elapsed, the AO ought to have obtained the sanction of the Joint/Additional CIT u/s 151(2). Instead, he routed the file through the Additional CIT and obtained the sanction of the CIT. On appeal by the assessee, the Tribunal struck down the reopening on the ground that correct sanction had not been obtained. On appeal by the department, HELD upholding the Tribunal:

ACIT Vs. AKME Projects Limited - ITAT Delhi

The Assessee, in order to make its offer an honest attempt, apart from declaring the discrepancy had offered an additional sum to its return of income and also if AO disallowed any sum which shall not exceed the excess amount offered to tax by the assessee. Then such disallowance can be withdrawn.

SRL Ranbaxy Ltd vs. ACIT - ITAT Delhi

The assessee entered into agreements with hospitals etc (“collection centres“) in accordance with which the centres collected samples from patients seeking laboratory tests and forwarded it to the assessee. The centres raised a bill on the patient, retained their “discount” and paid the balance to the assessee. The assessee claimed that it had rendered “professional services” & that the centres had rightly deducted TDS u/s 194J. The AO held that in collecting the sample and forwarding it to the assessee, the centres acted as an “agent” of the assessee and that the “discount” retained by it was “commission” and that the assessee ought to have deducted TDS u/s 194H. He consequently disallowed the “discount” u/s 40(a)(i) in the hands of the assessee. This was upheld by the CIT (A). On appeal by the assessee, HELD reversing the decision of AO & CIT(A) as the obligation of TDS u/s 194 H arises only at the time of “payment” or “credit”. The assessee had not paid or credited any amount to the account of the Centres, Sec.194H had no application. The assessee had only credited the net amount received from the Centres as its income.

Ranbaxy Laboratories Ltd vs. CIT - Delhi High Court

The assessee entered into international transactions with its AEs, the value of which exceeded Rs. 5 crores. The AO passed an order u/s 143(3) in which he recorded the finding that he had examined the transactions and found them to be at arms’ length and no transfer pricing adjustment was required to be made. The CIT thereafter passed an order u/s 263 on the ground that in view of Instruction No. 3 of 2003 dated 20.5.2003, the AO ought to have referred the issue to the TPO instead of himself determining the arms’ length price of the transactions and that the assessment order was consequently “erroneous and prejudicial to the interests of the revenue”. On appeal, the Tribunal upheld the revision order. On further appeal by the assessee, HELD dismissing the appeal.

Airport Authority of India vs. CIT - Delhi High Court – Full Bench

The assessee incurred expenditure on removal of encroachments and claimed the same as a revenue deduction on the ground that the expenditure was incurred in the normal course of the business. The AO, CIT (A) & Tribunal rejected the claim on the basis that the assessee had acquired an advantage of an enduring nature. The High Court (for an earlier year, Airport Authority of India vs. CIT 303 ITR 433) upheld the view of the authorities that the expenditure was capital in nature. For the present year, the issue was referred to the Full Bench. HELD by the Full Bench reversing the decision of lower authorities.

M/s Getit Infomediary Ltd. Vs. ACIT - ITAT Delhi

The assessee has written off bad debts amounting to Rs.2,62,03,589 receivable from Government Telephone Departments and others by debiting the same to the Profit & Loss account.  The Assessing Officer has himself allowed 75% thereof as admissible deduction.  The Assessing Officer has failed to point out any material in support of his allegation that the bad debts have not been properly written off in the books though he himself has stated in the Assessment Order that “On perusal of the P & L A/c account it is noticed that the assessee has claimed bad debts written off amounting to Rs.2,62,03,589 during the year.”  and he also found that from the list furnished by the assessee, it was seen that bad debts belong to Government Telephone Departments and others. It is clear that the issue involved in this appeal is fully covered by the decision of the Tribunal as
well as of Jurisdictional Delhi High Court in the assessee’s own case on similar set of facts of the case.  We, therefore, delete the disallowance of bad debts amounting to Rs.65,50,897 and allow the ground raised by the
assessee.

Date of Order : 26/12/2011, To get the Complete Order Kindly contact Administrator.

Aithent Technologies Pvt Ltd vs. ITO - ITAT Delhi

The assessee advanced Rs. 7.39 crores to its AE on interest-free terms. For transfer pricing purposes, It claimed that no external comparable uncontrolled price was available for benchmarking the transaction and so the Transactional Net Margin Method (TNMM) was applicable to determine the arm’s length basis of the loan. Applying TNMM, the assessee claimed that the notional interest was factored in the software development income and no separate addition could be made.

Ram S. Sarda vs. DCIT - ITAT Rajkot

Cash Seized in Search conducted u/s 132 can be applied as "Advance Tax" against the Assessee's liability.


Pursuant to a search u/s 132, cash was seized from the assessee and third parties and assessed as the assessee’s income. Though the assessee requested that the said seized cash be treated as payment of “advance tax”, the AO ignored the same and levied interest u/s 234A, 234B & 234C on the basis that advance tax had not been paid. On appeal, the CIT (A) relied on Central Provinces Manganese 160 ITR 961 (SC) and held that the ground was not maintainable. It was also held that cash seized from third parties could not be treated as the assessee’s payment of advance tax. On appeal by the assessee, HELD allowing the appeal.