Issuance of Section 148 Notice by Local AO Lacks Jurisdiction in View of CBDT Notification Mandating NFAC Issue Whether a notice issued under section 148 of the Income-tax Act, 1961 by a local Assessing Officer (AO) is legally sustainable when exclusive power to issue such notices was conferred upon the National Faceless Assessment Centre (NFAC)… Read More »
Reopening Notice Based on Predated Third-Party Seized Entries Lacking Live Nexus to Assessee Is Unjustified Issue Whether a reopening notice under section 148 for alleged unexplained on-money investment under section 69 is legally sustainable when based solely on third-party seized records that lack a live nexus to the assessee. Facts Property Acquisition: The assessee, along… Read More »
Addition for Alleged Understated Export Sales Deleted as Net Realizations and Prior-Year Invoices Fully Reconciled Addition for Alleged Understated Export Sales Deleted as Net Realizations and Prior-Year Invoices Fully Reconciled Issue Whether the CIT(A) was justified in deleting the addition of ₹4.59 crores made by the Assessing Officer on account of alleged undisclosed or understated… Read More »
TP Adjustments on Aggregated Royalty, Intra-Group Services, and Receivables Deleted while Working Capital Adjustment Remanded Issue Whether transfer pricing adjustments concerning operating cost items, turnover filters, comparable selections across segments, notional interest on delayed receivables, aggregated royalty payments, intra-group service charges, working capital adjustments, and non-TDS disallowances under section 40(a)(ia) are legally sustainable for AY… Read More »
DDT on Dividends to Non-Residents Restricted to DTAA Rates; Corporate Club Membership Fees Fully Allowable Issue Whether Dividend Distribution Tax (DDT) under section 115-O on dividends paid to non-resident shareholders is capped by DTAA rates, and whether corporate club membership fees qualify as allowable business expenditure under section 37(1). Facts DDT on Foreign Shareholders (AYs… Read More »
Ad hoc Disallowances, Form 26AS Additions, and Cessation Triggers Deleted; Flood Relief Expenses Remanded for Assessment Issue Whether ad hoc expense disallowances, section 40(a)(ia) penalties for non-compliance with section 194C(7), section 41(1) additions on outstanding trade advances, section 26AS interest adjustments without accrual, high repair expenses on leased property, infrastructure sharing payments, and section 43B… Read More »
Bad Debt Claims, MAT Credit Corrections, and Rectification Orders Remanded for Verification and Natural Justice Issue Whether the write-off of advances, correction of MAT credit without a revised return, and ex-parte rectification orders adding FTS disallowances require factual verification and adherence to natural justice. Facts Bad Debts/Advances Write-off: For AY 2011-12, the assessee (an automotive… Read More »
Interest Disallowance Remanded for Verification While Section 40(a)(ia) and Land Conversion Charge Disallowances are Upheld Issue Whether interest on borrowed capital for work-in-progress requires verification, whether section 40(a)(ia) applies to paid amounts, and whether land conversion charges/interest qualify for business expenditure or capital allowances. Facts Interest on Borrowed Capital: For AYs 2009-10 to 2010-11, the… Read More »
TP Adjustments, 80-IA Deductions, and Section 14A Disallowance Deleted; Power Benchmarking, Cess, and Interest Remanded Issue Whether transfer pricing adjustments on cost allocations, external CUP benchmarking for power transfer, section 80-IA disallowances, section 14A additions without exempt income, MAT cess adjustments, and section 234A interest levies are legally sustainable for AY 2020-21. Facts TP Adjustment… Read More »
Upfront Timeshare Membership Fees with Long-Term Service Obligations Cannot Be Taxed Fully in the Initial Year and Must Be Deferred over the Contract Term Issue Whether upfront timeshare membership fees collected by an assessee are fully taxable in the initial year under the mercantile system of accounting, or if 55% of the fee can be… Read More »