Trading additions are restricted to a profit percentage when corresponding sales are accepted as genuine. Trading additions are restricted to a profit percentage when corresponding sales are accepted as genuine. Issue Whether the revenue department is legally justified in seeking a full or enhanced addition for alleged bogus purchases under Section 69 when the corresponding… Read More »
Concealment penalty under Section 271(1)(c) is unsustainable when quantum addition is based on estimation. Issue Whether the Tribunal was correct in law by setting aside a concealment penalty levied under Section 271(1)(c) on the ground that the underlying quantum addition for bogus purchases had been restricted and sustained purely on an estimated percentage (12.5%). Facts… Read More »
Depreciation under block of assets is allowable even if manufacturing operations are discontinued during the year. Issue Whether an assessee is entitled to claim depreciation on a block of assets (plant, machinery, and buildings) for an assessment year when its manufacturing operations have been discontinued, particularly when identical claims were allowed in preceding years under… Read More »
Audited books showing sufficient cash-in-hand invalidate Section 68 additions for demonetization bank deposits. Issue Whether the Assessing Officer can legally reject a taxpayer’s explanation and make an addition under Section 68 for cash deposited during the demonetization period, when the taxpayer establishes that the deposits originated from cash-in-hand recorded in its regularly maintained, unblemished, and… Read More »
Tax authorities cannot dispute a company’s commercial wisdom in securing loans to repay prior debt obligations. Issue Whether the Assessing Officer can disallow finance costs under Section 37(1) by questioning the commercial wisdom or business acumen of an assessee who takes out a new loan to repay an existing bank loan. Whether the finance costs… Read More »
Consequential verification by AO infirms PCIT’s revisionary order, but unverified CSR and TDS interest claims stand remanded. Consequential verification by AO infirms PCIT’s revisionary order, but unverified CSR and TDS interest claims stand remanded. Issue Whether the Principal Commissioner of Income-tax (PCIT) was legally justified in invoking revisionary jurisdiction under section 263 on the grounds… Read More »
Opening WDV of a block of assets cannot be disturbed to deny depreciation based on a circular. Issue Whether the Principal Commissioner of Income Tax (PCIT) can invoke revisionary jurisdiction under Section 263 to deny depreciation on an intangible asset (NHAI concession rights) by applying CBDT Circular No. 9/2014, when the asset had already entered… Read More »
Principal Commissioner cannot invoke revisionary powers under Section 263 when the Assessing Officer has already conducted proper inquiries and verified the expenses during assessment. Principal Commissioner cannot invoke revisionary powers under Section 263 when the Assessing Officer has already conducted proper inquiries and verified the expenses during assessment. Issue Whether the Principal Commissioner of Income… Read More »
Tax Recovered In Violation Of Judicial Stay Ordered To Be Refunded Exceeding Twenty Percent PreDeposit Issue Whether an order passed on a stay/waiver application under Section 220 should be quashed and the illegally recovered demand refunded when the Revenue aggressively appropriated the entire disputed tax amount despite a subsisting High Court interim stay order. Facts… Read More »
DGCEI is a Law Enforcement Agency, Exempting Departmental Appeals From CBDT Monetary Limits Issue Whether the Directorate General of Central Excise Intelligence (DGCEI) qualifies as a “law enforcement agency” under paragraph 10(e) of the CBDT Circular dated 11.07.2018 (read with Circular dated 20.08.2018), thereby exempting the Revenue’s appeal from the standard Rs. 50 lakhs low… Read More »