Reassessment Notice Issued Beyond Four Years Without Proof of Valid Sanction Under Section 151 Is Invalid Reassessment Notice Issued Beyond Four Years Without Proof of Valid Sanction Under Section 151 Is Invalid Issue Whether a reassessment notice issued under Section 148 beyond four years from the end of the relevant assessment year is legally valid… Read More »
CPC Cannot Disallow Diminution in Subsidiary Investment Under Section 143(1)(a) Contrary to Jurisdictional High Court Ruling Issue Whether CPC can disallow a claim for diminution in value of investment in a wholly-owned subsidiary under Section 143(1)(a) based solely on a Tax Audit Report when a binding Jurisdictional High Court decision allows it, and whether non-consideration… Read More »
Consideration received on issuing FCCDs falls outside Section 56(2)(viib) as debentures are not equity shares. Issue Whether consideration received by an assessee-company towards the issuance of Fully Compulsory Convertible Debentures (FCCDs), which are convertible into equity shares at a future date, can be equated with the issue of equity shares so as to invoke the… Read More »
Section 153C proceedings quashed as inordinate delay in recording satisfaction note barred action by limitation. Issue Whether initiation of assessment proceedings under Section 153C against a third party is barred by limitation and without jurisdiction due to an inordinate, unexplained delay in recording satisfaction notes and issuing notice. Facts Search Conducted: Search and seizure operations… Read More »
Major tax additions against stockbroker deleted due to unproven third-party data and past precedents. Issue Whether tax additions made on account of money market positions, unexplained moneys, trading profits, cash credits, and statutory adjustments for Assessment Year 1993-94 are sustainable in law without supporting evidence and contrary to established past precedents. Facts Money Market Transactions:… Read More »
High Court-approved capital reduction cannot be recharacterised as a buy-back under Section 115QA. Issues Whether tax authorities can recharacterise a High Court-approved capital reduction under Sections 100 to 104 of the Companies Act, 1956 as a share buy-back under Section 115QA of the Income-tax Act, 1961. Whether interest paid on capital borrowed and utilized for… Read More »
No TDS default under section 201 applies for EDC payments if payee satisfies first proviso conditions. Issue Whether the assessee can be treated as an assessee-in-default under section 201(1) and saddled with interest under section 201(1A) for non-deduction of TDS under section 194C on External Development Charges (EDC) paid to HUDA/HSVP on directions of DTCP,… Read More »
Corporate Guarantee Commission Rate Restricted to 0.60 Percent Following Consistency Rule, and TDS Reconciliation Remanded for Re-Verification Issue Whether the Transfer Pricing Officer (TPO) was justified in departing from the established 0.60% arm’s length corporate guarantee rate by relying on external bank guarantee rates, and whether short credit of TDS/TCS granted by the Assessing Officer… Read More »
Unrelated Parties’ Royalty Agreement Cannot Be Subjected to Transfer Pricing Adjustments or Section 37(1) Benchmarking Issue Whether royalty paid by a resident assessee to an unrelated foreign entity under an arms-length trademark license agreement can be subjected to transfer pricing adjustments under Section 92A or disallowed as excessive under Section 37(1). Facts Agreement & Transaction:… Read More »
Allotment and buy-back of equity shares known to alleged benamidars does not constitute a benami transaction. Allotment and buy-back of equity shares known to alleged benamidars does not constitute a benami transaction. Issue Whether creation of trade payables, conversion into securities premium, and allotment/buy-back of shares known to job workers fall under Section 2(9)(C) of… Read More »