Daily Archives: November 5, 2025

Late TDS Deposit is a “Technical Offense”; Conviction Upheld, but Fine Replaced with Admonition. Issue Whether a company can be prosecuted and held guilty under Section 276B for delaying the deposit of TDS, even if the amount (plus interest) is paid later? And whether a “reasonable cause” defense under Section 278AA can be claimed without… Read More »

Reassessment Quashed as Approval Was Obtained Under the Wrong Statutory Provision. Issue Whether a reassessment notice issued after three years from the end of the assessment year is legally valid if the sanction for it was obtained under Section 151(i) (meant for notices within three years) instead of from the “specified authority” as mandatorily required… Read More »

54B Exemption Remanded as Assessee Failed to Prove Land’s Agricultural Use. Issue Whether a taxpayer is entitled to claim the capital gains exemption under Section 54B for the sale of agricultural land if they fail to provide any cogent documentary evidence to prove that the land was actually used for agricultural purposes for the two… Read More »

Tax Audit Not Required for Mutual Concerns as Their Activities Are Not “Business.” Issue Can a penalty under Section 271B be levied for failure to file a tax audit report (under Section 44AB) on an entity whose transactions are governed by the “principle of mutuality” and are not carried out for profit? Facts The assessee… Read More »

HC Remands Disallowance on Pension Bonds Due to Contradictory Claims and ITR Error. Issue Whether a disallowance of a “fair value adjustment” on pension bonds, claimed as a deduction under Section 43B, should be sustained, especially when the assessee’s arguments are contradictory (claiming it is both a notional entry and an interest payment) and the… Read More »

Impairment Loss on Fixed Assets is a Capital Adjustment, Not a Revenue Deduction. Issue Whether an “impairment loss” or “abnormal loss” on fixed assets (wind turbines) damaged in a cyclone can be claimed as a revenue expenditure/deduction against business income, or if it must be treated as a capital adjustment in the block of assets.… Read More »

14A Disallowance Not Addable to Book Profits; Computation Restricted to Income-Yielding Investments. Issue Whether a disallowance computed under Section 14A of the Income-tax Act can be added back when computing “book profits” for the purpose of Minimum Alternate Tax (MAT) under Section 115JB. For the purpose of calculating the disallowance under Rule 8D, should the… Read More »

Proviso to Section 12A(2) Valid for AY 2018-19, Allowing Assessee to Switch to Section 11 Exemption. Issue Whether the first proviso to Section 12A(2) of the Income-tax Act was applicable for the Assessment Year 2018-19, thereby enabling an assessee (who had mistakenly claimed exemption under Section 10(23C)) to switch their claim and be granted exemption… Read More »