Deemed Application of Income Spent on Immovable Property Does Not Require Schedule-I Disclosure under Form I-TR7 Issue Whether the addition of approximately ₹4.00 crores was sustainable under Section 11 of the Income-tax Act, 1961, when the assessing authorities disallowed a valid utilization of “deemed application” of income from the preceding year solely due to its… Read More »
Deduction under Section 80P cannot be denied in full over nominal membership limits. Issue Whether a co-operative society can be denied its deduction under Section 80P(2)(a)(i) in full on the grounds that it admitted nominal or associate members beyond the statutory 15% limit prescribed under State law, and whether the disallowance of an interest provision… Read More »
Unexplained trade credits are taxable under Section 68 as income from other sources and ineligible for Section 80-IA business deductions. Issue Whether undisclosed trade credits can be treated as business profits eligible for deductions under Section 80-IA, or if they must be assessed as deemed income from other sources under Section 68 when the assessee… Read More »
DVO valuation replaces stamp duty valuation, making safe harbor limits applicable to the revised value. Issue Whether the safe harbor rule applies to the revised value determined by the Departmental Valuation Officer (DVO) once an assessee disputes the stamp duty valuation under Section 56(2)(x). Facts The assessee purchased a residential flat for a consideration of… Read More »
Rural agricultural land is not a capital asset, and hereditary ancestral land incurs no unexplained investment cost. Issue Whether the Assessing Officer was justified in taxing capital gains on the sale of rural agricultural land and making an addition for unexplained investment under Section 69B on hereditary ancestral land. Facts The assessee, an individual, did… Read More »
The Commissioner (Appeals) can validly set aside an ex-parte reassessment and remand it for fresh adjudication. The Commissioner (Appeals) can validly set aside an ex-parte reassessment and remand it for fresh adjudication. Issue Whether the Commissioner (Appeals) [CIT(A)] is legally empowered under Section 251(1)(a), read with the statutory proviso inserted via the Finance Act, 2024,… Read More »
Unrealizable insolvency assets must be excluded from Rule 11UA Fair Market Value computations. Issue Whether the Assessing Officer (AO) is legally justified in mechanically invoking Section 50CA and Rule 11UA to calculate the Fair Market Value (FMV) of unquoted shares based purely on book values, without excluding unrealizable insolvency assets or considering the price discovered… Read More »
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 »
Assessing Officer directed to exclude Mutual Funds and Tax Free Bonds from Section 14A calculations. Issue Whether the Assessing Officer, while computing the indirect expense disallowance under Section 14A read with Rule 8D(2)(ii), must exclude investments made in Mutual Funds and Tax Free Bonds from the average value of investments. Whether any further disallowance can… 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 »