Income Tax Notices for Pre-Resolution Plan period Quashed; “Clean Slate” Theory under IBC prevails Issue Whether the Income Tax Department (Assessing Officer) has jurisdiction to issue notices under Sections 143(2) and 142(1) seeking information or conducting assessment for a period prior to the approval of a Resolution Plan under the Insolvency and Bankruptcy Code (IBC),… Read More »
CSR Expenditure allowed as Section 80G Deduction; “Mandatory” nature is no bar Issue Whether expenditure incurred by a company to fulfill its mandatory Corporate Social Responsibility (CSR) obligations under the Companies Act, 2013, is eligible for deduction under Section 80G of the Income-tax Act, 1961, despite being disallowed as business expenditure under Section 37(1). Facts… Read More »
Section 69A Addition on “Penny Stock” Sale Deleted; Long-Term Holding Proves Genuine Investment Issue Whether the sale proceeds from shares of a company alleged to be a “penny stock” can be taxed as unexplained money under Section 69A, when the assessee had purchased the original shares years ago via banking channels, held them for a… Read More »
Unexplained Credits in Firm’s Account Taxed; 60% Tax Rate u/s 115BBE held Not Retrospective for AY 2017-18 I. Unexplained Credits in Firm’s Account (Section 69A) Issue Whether cash deposits and credits in a partnership firm’s bank account can be taxed as the firm’s undisclosed income when the assessee claims the firm was dissolved and the… Read More »
Addition in Reassessment deleted as Primary Reason for Reopening was dropped; Ranbaxy Principle applied Issue Whether an Assessing Officer (AO) can validly make an addition on a new issue (unexplained credits/loans) during reassessment proceedings under Section 147, if no addition is ultimately made on the primary ground (turnover mismatch) for which the case was originally… Read More »
Section 54F Denial Set Aside; Matter Remanded to Verify Additional Evidence Issue Whether an appellate order confirming the denial of exemption under Section 54F should be set aside and restored to the Assessing Officer (AO) if the assessee produces additional evidence before the Tribunal that was not available or could not be filed during the… Read More »
I. Section 14A Disallowance: Capped at Exempt Income & Only Yielding Investments Issue Can the disallowance of expenditure under Section 14A exceed the total exempt income earned during the year? Should Rule 8D calculations consider all investments or only those that actually yielded exempt income? Decision Cap on Disallowance: The Tribunal reiterated the settled principle… Read More »
Addition in Reassessment deleted as Primary Reason for Reopening was dropped; Ranbaxy Principle applied Issue Whether an Assessing Officer (AO) can validly make an addition on a new issue (unexplained credits) during reassessment proceedings under Section 147, if no addition is ultimately made on the primary ground (turnover mismatch) for which the case was originally… Read More »
Reassessment Order against NRI Quashed; Regular ITO lacks Jurisdiction over Non-Resident Issue Whether a reassessment order passed against a Non-Resident Indian (NRI) is valid if the initial notice under Section 148 was issued by a regular/local Income Tax Officer (ITO) instead of the ITO (International Taxation) who holds the specific jurisdiction over non-residents. Facts Assessee… Read More »
Reopening Notice for AY 2014-15 issued in July 2022 held Time-Barred; TOLA extension cannot breach 6-year absolute limit Issue Whether a notice under Section 148 issued on 27-07-2022 for Assessment Year 2014-15 is barred by limitation under the first proviso to Section 149, given that the 6-year limit under the old regime had expired, and… Read More »