| Section 9 |
Joint Commissioner of Income-tax v. Chowgule & Company (P.) Ltd. |
Payments made to non-residents for consultancy/technical services rendered outside India before retrospective amendments do not attract withholding requirements and cannot be disallowed under Section 40(a)(i). |
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Income-tax Act, 1961 |
| Section 10(10B) |
Mysore Ramaswamy Harish v. Income-tax Officer |
Ex-gratia/compensation under BSNL VRS 2019 qualifies as retrenchment compensation under Section 10(10B). The correct exemption claim can be raised before the CIT(A) even if misclaimed under Section 10(10C) in the original return. |
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Income-tax Act, 1961 |
| Section 12AA |
Commissioner of Income-tax v. Sahasra Linga Yoga Anjaeya Saptharishi Peedam Seva Trust |
A trust created with both charitable and religious objects is eligible for registration under Section 12AA, as the law does not differentiate between the two objects nor disqualify such mixed trusts. |
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Income-tax Act, 1961 |
| Section 14A |
Joint Commissioner of Income-tax v. Chowgule & Company (P.) Ltd. |
No interest disallowance under Rule 8D(2)(ii) is warranted if sufficient interest-free funds are available. For Rule 8D(2)(iii), disallowance is restricted to fresh investments in group companies yielding exempt income and head office administrative expenses, capped at exempt income earned. |
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Income-tax Act, 1961 |
| Section 31 |
Joint Commissioner of Income-tax v. Chowgule & Company (P.) Ltd. |
Mandatory dry docking and repair expenses on a transhipper vessel to maintain operational fitness without creating a new asset or enduring advantage are allowable as “current repairs.” |
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Income-tax Act, 1961 |
| Section 32 |
Joint Commissioner of Income-tax v. Chowgule & Company (P.) Ltd. |
Light motor vehicles qualify as commercial vehicles, making them eligible for the higher 50% depreciation rate. |
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Income-tax Act, 1961 |
| Section 32 |
Joint Commissioner of Income-tax v. Chowgule & Company (P.) Ltd. |
Depreciation on goodwill’s written down value (WDV) created during amalgamation in an earlier year is allowable, even if the amalgamating company had not claimed depreciation on it in its books. |
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Income-tax Act, 1961 |
| Section 32 |
Joint Commissioner of Income-tax v. Chowgule & Company (P.) Ltd. |
Depreciation is allowable on an entire block of assets if any part is put to use; temporary shutdown of a specific section (e.g., wet process section) due to government orders does not disentitle depreciation. |
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Income-tax Act, 1961 |
| Section 32 |
Joint Commissioner of Income-tax v. Chowgule & Company (P.) Ltd. |
Higher depreciation at 80% claimed on electrical energy-saving devices is allowable if such higher rate was accepted and allowed on the same block in preceding assessment years. |
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Income-tax Act, 1961 |
| Section 36(1)(iii) |
Joint Commissioner of Income-tax v. Chowgule & Company (P.) Ltd. |
Interest on interest-free advances to subsidiaries cannot be disallowed if borrowings were primarily for refinancing, interest-free funds were sufficient, and advances served business purposes without a direct nexus to borrowed funds. |
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Income-tax Act, 1961 |
| Section 37(1) |
Joint Commissioner of Income-tax v. Chowgule & Company (P.) Ltd. |
Ad hoc disallowance for foreign travel expenses of directors/executives lacking complete documentation was restricted from 20% down to 10% to account for potential personal usage. |
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Income-tax Act, 1961 |
| Section 37(1) |
Joint Commissioner of Income-tax v. Chowgule & Company (P.) Ltd. |
Contributions made to GIDC for constructing/repairing public roads as directed by authorities due to mining operations constitute allowable revenue expenditure as the roads are not owned by the assessee. |
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Income-tax Act, 1961 |
| Section 37(1) |
Joint Commissioner of Income-tax v. Chowgule & Company (P.) Ltd. |
Irrecoverable non-capital business advances given to suppliers/service providers in the ordinary course of business cannot be disallowed merely because they were wrongly claimed as bad debts under Section 36(1)(vii). |
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Income-tax Act, 1961 |
| Section 37(1) |
Joint Commissioner of Income-tax v. Chowgule & Company (P.) Ltd. |
Expenses on temple repairs and local institutes aimed at fostering community relations without acquiring capital assets are allowable business expenses, with only 15% disallowed as non-business/CSR donations. |
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Income-tax Act, 1961 |
| Section 37(1) |
Joint Commissioner of Income-tax v. Chowgule & Company (P.) Ltd. |
Dumping conversion charges paid to the government to regularize mining dumps are statutory charges (not penalties) allowable as revenue expenditure, deductible on payment basis under Section 43B. |
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Income-tax Act, 1961 |
| Section 37(1) |
Joint Commissioner of Income-tax v. Chowgule & Company (P.) Ltd. |
Net Present Value (NPV) charges paid for compensatory afforestation in commercial business operations are allowable as revenue business expenditure rather than capital outgoings. |
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Income-tax Act, 1961 |
| Section 37(1) |
Joint Commissioner of Income-tax v. Chowgule & Company (P.) Ltd. |
Stamp duty paid on renewal deeds for existing mining leases is allowable as a revenue/legal expense to facilitate business continuity and does not create a new capital asset. |
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Income-tax Act, 1961 |
| Section 37(1) |
Joint Commissioner of Income-tax v. Chowgule & Company (P.) Ltd. |
Write-off of custom, obsolete, and unsellable inventory by a 100% EOU is deductible as a revenue loss, even if no physical sale or disposal took place due to EOU restrictions. |
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Income-tax Act, 1961 |
| Section 37(1) |
Joint Commissioner of Income-tax v. Chowgule & Company (P.) Ltd. |
Higher education/training fees paid to foreign universities for employees who are relatives of directors are allowable business expenses based on commercial expediency. |
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Income-tax Act, 1961 |
| Section 37(1) |
Happiest Minds Technologies Ltd. v. DCIT |
Failure by the CPC to consider a binding High Court ruling allowing the diminution in value of investment in a subsidiary is a mistake apparent from record, rectifiable under Section 154. |
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Income-tax Act, 1961 |
| Section 37(1) |
Happiest Minds Technologies Ltd. v. DCIT |
An adjustment under Section 143(1)(a) disallowing diminution in investment value based solely on a Tax Audit Report cannot stand if it overrides a binding jurisdictional High Court decision. |
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Income-tax Act, 1961 |
| Section 40(a)(i) |
Joint Commissioner of Income-tax v. Chowgule & Company (P.) Ltd. |
Demurrage and dispatch settlements made with foreign buyers under FOB contracts are post-shipment price adjustments, not independent payments; thus, Section 195 TDS is not applicable, making Section 40(a)(ia) disallowance invalid. |
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Income-tax Act, 1961 |
| Section 54F |
Prayas Goel v. Assistant Commissioner of Income-tax |
Reassessment proceedings are invalid and liable to be quashed if initiated on a mere change of opinion on scrutinized issues, or if recorded reasons under Section 148A(b) fail to mention the Section 54F claim being challenged. |
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Income-tax Act, 1961 |
| Section 68 |
Joint Commissioner of Income-tax v. Chowgule & Company (P.) Ltd. |
Additions based on seized loose papers suggesting cash payments cannot be sustained where transactions were bank-settled, papers reflected estimates, and no cross-examination or corroborative proof of cash dealings was provided. |
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Income-tax Act, 1961 |
| Section 69C |
Bhavya Bishnoi v. Deputy Commissioner of Income-tax |
An undated, unsigned seized notebook carrying no names or references to the assessee cannot invoke statutory presumption under Section 69C for making additions towards unexplained election expenses. |
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Income-tax Act, 1961 |
| Section 69C |
Bhavya Bishnoi v. Deputy Commissioner of Income-tax |
Alleged unexplained campaign expenditure for polling occurring in FY 2019-20 (AY 2020-21) cannot be legally added or assessed in AY 2019-20. |
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Income-tax Act, 1961 |
| Section 80GGC |
Ashok Kumar Chandela v. Income-tax Officer |
Reassessment for escaped income below Rs. 50 lakh initiated beyond the three-year limitation period under Section 149(1) is time-barred and invalid. |
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Income-tax Act, 1961 |
| Section 80P |
Z.253 Annappanpettai Primary Agricultural co-operative credit society Ltd. v. Chief Commissioner of Income-tax |
Substantive deduction under Section 80P cannot be denied to a Primary Co-operative Society solely due to a delayed return under Section 80AC; the AO must revise the assessment and allow the claim subject to a Rs. 5,000 late fee. |
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Income-tax Act, 1961 |
| Section 119 |
Sojitz Asia Pte. Ltd. v. Commissioner of Income-tax (International Taxation) |
Rejection of a Section 119(2)(b) application was set aside as double taxation resulting from a deductor’s delayed Form 26AS revision constitutes genuine hardship and leads to unjust enrichment. |
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Income-tax Act, 1961 |
| Section 143 |
Vandana Kumari v. Principal Commissioner of Income-tax |
Reassessment orders passed under Section 147 without issuing and serving the mandatory scrutiny notice under Section 143(2) are legally invalid. |
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Income-tax Act, 1961 |
| Section 148 |
Vandana Kumari v. Principal Commissioner of Income-tax |
A return filed in response to a Section 148 notice is valid even if submitted beyond the 30-day window specified in the notice. |
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Income-tax Act, 1961 |
| Section 148 |
Dr Reddy’s Laboratories Ltd. v. Assistant Commissioner of Income-tax |
A reassessment notice issued under Section 148 in the name of a non-existing entity is void and liable to be quashed. |
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Income-tax Act, 1961 |
| Section 153D |
Pr Commissioner of Income-tax v. Vallabh Pittie South West Industries Ltd. |
Approvals granted under Section 153D issued en masse within 24 hours using identical mechanical language without reviewing draft orders are invalid, voiding the consequential search assessment orders. |
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Income-tax Act, 1961 |
| Section 200 |
Md. Shahid Ahmad Siddiqui v. Principal Commissioner of Income-tax |
An employee cannot be penalized or denied credit if the employer deducts TDS from salary but fails to deposit it or file returns; recovery proceedings must be initiated against the defaulting employer. |
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Income-tax Act, 1961 |
| Section 200 |
Md. Shahid Ahmad Siddiqui v. Principal Commissioner of Income-tax |
The six-year limitation period under Section 200(3) applies to corrected statements and does not bar employers from filing original, pending TDS statements for past periods. |
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Income-tax Act, 1961 |
