Reassessment additions are legally unsustainable if the original issue triggering the reopening is entirely dropped. Issue Whether the Assessing Officer can legally disallow a Section 54 capital gains deduction and make a new addition in a reassessment order if no addition is ultimately made on the primary issue for which the Section 147 reopening was… Read More »
Rebate Under Section 87A Cannot Be Denied on Section 112 Capital Gains for Assessment Year 2024-25 Issue Whether a resident individual opting for the new tax regime under Section 115BAC is eligible to claim a tax rebate under Section 87A against long-term capital gains taxable under Section 112, provided their total income does not exceed… Read More »
Interest Income From Mandatory Bank Deposits Is Business Income Eligible For Section 80P Deduction Issue Whether interest income earned by a co-operative society from statutory and compulsory deposits placed with co-operative or scheduled banks in compliance with State co-operative laws is assessable as business income eligible for deduction under Section 80P(2)(a)(i), or as income from… Read More »
Delay of 252 days condoned by ITAT; CIT(A) order dismissing JDA capital gains claim in limine set aside for failure to evaluate delay condonation. Issue Whether the Income Tax Appellate Tribunal (ITAT) should condone a 252-day delay in filing an appeal by a deceased assessee’s legal heir, and whether the CIT(A) was justified in dismissing… Read More »
Bonus shares held as long-term investments yield exempt LTCG, overriding their original stock-in-trade classification per CBDT circular. Issue Whether the gains arising from the sale of bonus shares should be taxed as Business Income under Section 28(i) on the ground that the original underlying shares were held as stock-in-trade, or if they qualify as Long-Term… Read More »
AO cannot impose a 200% misreporting penalty under Section 270A without specifying the exact statutory clause breached, especially when the taxpayer acted on a bona fide reliance on Form 16. Issue Whether a 200% penalty for misreporting under Section 270A can be legally sustained when the Assessing Officer (AO) fails to specify the exact statutory… Read More »
Rebate under Section 87A is computed on the “total income” and cannot be denied on tax payable for Short-Term Capital Gains under Section 111A. Issue Whether the Central Processing Centre (CPC) / Assessing Officer is legally justified in restricting the tax rebate under Section 87A only to the tax computed on normal slab incomes, thereby… Read More »
ESOP discount is an ascertained business expenditure under Section 37(1), and no Section 14A disallowance can be made if no exempt income is earned. Issue Whether the discount on the issuance of Employee Stock Option Plans (ESOPs) is an allowable business expenditure under Section 37(1) rather than a national or contingent liability, and whether a… Read More »
Tax Authorities Cannot Arbitrarily Reverse Multi-Year Deductions or Disallow Reimbursed Employee ESOP Costs, But Share Issue Expenses Remain Capital in Nature Issue Whether the Assessing Officer is justified in disallowing a multi-year amortization deduction under Section 35D in its final (5th) year when the same deduction was accepted and allowed without disturbance by the Revenue… Read More »
Deductions Amortized In Prior Years Cannot Be Arbitrarily Disallowed In The Final Year And ESOP Cost Rebounds Are Revenue Expenses But Share Issue Costs Expand Capital Base Permanently Deductions Amortized In Prior Years Cannot Be Arbitrarily Disallowed In The Final Year And ESOP Cost Rebounds Are Revenue Expenses But Share Issue Costs Expand Capital Base… Read More »