We are glad to present to you the 241st edition of ‘Taxsutra Database Bulletin’, where we keep you updated with current trends in the tax arena!
Status of Journals Updated
ITR - Vol 435 PART 2
Dated - 12th July 2021
ITR Trib - 89 Issue 2
Dated - 12th July 2021
CTR Vol - 321 Issue 25
Dated - 18th June 2021
DTR Vol - 203 Issue 127
Dated - 13th July 2021
TAXMAN Vol - 280 Part 3
Dated 17th July 2021
ITD VOL - 189 Issue 2
Dated - 14th July 2021
TTJ VOL - 212 Issue 26
Dated - 13th July 2021
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Key Takeaways from Handpicked Rulings
1) HC: Upholds deduction u/s 80P(2) to co-operative society engaged in banking business with non-members, follows Mavilayi - Bombay HC allows deduction u/s 80P(2)(a)(i) to the Assessee-co-operative society registered under the Goa Cooperative Societies Act, 2001 for AY 2012-13; Revenue had contended that the Assessee is engaged in full-blown banking operations with non-members and thus, it has to be treated as a co-operative bank, rather than as a co-operative society making it ineligible u/s 80P(2)(a)(i) & (ii); Assessee submitted that the main object of the society is to accept the deposits and provide financial accommodation to their members and hence the core activity continues to be that of a cooperative credit society; CIT(A) and ITAT also held in favour of Revenue by virtue of section 80P(4); HC analyses the definition of a cooperative bank u/s 5(cci) and (ccv) of the Banking Regulation Act, 1949 and takes note of the point that the Assessee satisfies the condition of being a co-operative society except from the fact that it does accept deposits from non-members which is otherwise not allowable; However, HC also notes that the transactions with non-members are................. Click here to read and download HC judgment
2) HC: Distinguishes ‘Production’ with ‘Manufacture’, holds Production have wider connotation, allows deduction u/s 10B - Bombay HC upholds ITAT’s order treating blending of iron ore as ‘manufacturing’ as per SEZ Act, 2005 applying for exemption u/s 10B; Assessee Company mines and exports iron ore, besides dealing in shipping and shipbuilding, manufacturing and selling low-ash metallurgical coke, claimed deduction u/s 10B for its 100% export-oriented units at Amona, Chitradurga and Codli which is denied by the AO on the ground that there is no production or manufacturing in these units; AO stated its reason for denial that Amona and Chitradurga units that commenced production in 1985 and 1994,cannot be termed as new units merely by expanding with new plant or machinery in 2002-03 and 2005-06, respectively and the unit at Codli does not fulfill the conditions of manufacture or production as required under section 10B(b)................ Click here to read and download HC judgment
3) HC: Nature of income cannot be different for same transaction in two different taxpayers- Bombay HC quashes ITAT’s order disallowing claim of capital gains on sale of plots of land by the Assessee and treating it as business income for AY 2010-11; Assessee, engaged in the business of cement and retail lime powder, claimed exemption u/s 54F on long term capital gains realized on sale of 4 plots of land which was purchased jointly with a co-owner and then subsequently converted into non agricultural land and then into various plots; Revenue contended that the activities of the Assessee had a character of an adventure in the nature of trade and thus, the intention behind sale of plots to different parties was to exploit the commercial potential of the land; HC observes that the Department had computed capital gains and granted section 50C benefit to the co-owner for the same transaction during its assessment while denying the same for the Assessee; Remarks that the said aspect needs to be considered while determining the nature of income in the hands of the Assessee for the subject AY;.............Click here to read and download HC judgment
4) ITAT: Fees paid to visiting doctors not liable to TDS u/s 192 in the absence of employer-employee relationship - ITAT upholds CIT(A)’s order in favour of Assessee-hospital allowing deduction of taxes u/s 194J and not u/s 192 in lieu of professional fees paid to visiting doctors for AY 2011-12; Assessee contended no existence of employer-employee relationship between the hospital and the visiting doctors as they were paid from the fees collected from the patients after retaining hospital’s share and were also not entitled to several benefits as were allowed to regular employees; Revenue on the other hand denied all of Assessee’s contentions and claimed, based on its survey findings u/s 133A, that services of the doctors were utilized only for the purpose of patients coming to the Assessee hospital and they were expected to work as per hospital’s rules and regulation and were barred from working in any other hospital or conduct private practice; ITAT takes note of Assessee’s submission showing monthly fees paid to visiting doctors that varied each month depending on the number of patients attended and also there was no specific timing and attendance record maintained by hospital with their respect;........................ Click here to read and download ITAT Order
5) ITAT: Quashes revisionary proceedings u/s 263, holds CSR expenses allowable deduction u/s 80G not falling under expressed restrictions - ITAT quashes revisionary proceedings initiated by Pr. CIT u/s 263 for AY 2016-17 for disallowing deduction claimed u/s 80G for CSR expenses; Assessee company, a mining service provider, claimed deduction on account of CSR expenses made to eligible/approved Charitable Trusts u/s 80G(5)(vi) which is mandatorily required as per section 135 of Companies Act; Pr. CIT contended that when there is an express prohibition u/s 37 by virtue of Explanation 2against allowing CSR expenditure, the A.O could not have given deduction u/s 80G; Further contended that the assessment order was passed without making any enquiries or verification, thus, attracting clause (a) of Explanation 2 to section 263(1); ITAT remarks that as per SC ruling in Malabar Industries Ltd “this phrase i.e. “prejudicial to the interest of the revenue’’ has to be read in conjunction with an erroneous order passed by the Assessing Officer…where two views are possible and the Assessing Officer has taken one view with which the CIT does not agree, it cannot be treated as an erroneous order prejudicial to the interest of the revenue “unless the view taken by the Assessing Officer is unsustainable in law”..................... Click here to read and download ITAT Order
6) ITAT: Deduction u/s 80IB(10) cannot be denied on admitted ‘on-money’ in connection with ongoing residential project declared as income – ITAT rules in assessees' favour, holds that once it is agreed to be ‘on-money’ from the flats-bookings at the time of its inclusion in the total income, a fortiori, such an income, being from sale of flats albeit received as on-money, qualifies for the deduction u/s 80IB(10) on such amount; Explains that the doctrine of approbate and reprobate does not allow the IT authorities to blow hot and cold in the same breath, thereby accepting one consequence arising from the statement of the assessee while rejecting the other one; Holds that "When the assessee made a surrender with the clear backdrop of having received ‘on money’ and the Revenue accepted the same while including it in the total income, it cannot later on claim that no deduction u/s 80IB(10) can be granted on the same as the assessee failed to prove that the flat bookers gave such on-money."................ Click here to read and download ITAT Order
7) ITAT: Delay in claiming TDS credit not attributable to assessee; Quashes rectification u/s 154 refusing assessee’s interest claim u/s 244A for the period of delay – ITAT rules in favour of assessee, holds that “delay of TDS credit not attributable to Taxpayers as the department gives credit to the TDS only when reflected in 26AS”; Observes that the updation of Form 26AS is beyond the control of the Taxpayers, hence the delay in updation should not be attributed to the Taxpayers; Upholds CIT(A) order directing AO to allow interest u/s 244A as was allowed in the earlier 154 order for the full period from 01.04.2009 to 21.02.2013; Notes that the AO passed an rectification order and granted interest on self assessment tax however interest on the TDS credit was given from the date of claim of TDS as against the date of deduction of tax; The reason stated for this by the AO is that the assessee claimed credit of TDS in the return which was later revised; As the delay from 01.04.2009 to 21.02.2013 in claiming credit of additional amount of TDS is attributable to the assessee, hence AO granted interest u/s 244A on the additional amount of TDS from 21.02.2013 onwards only which was confirmed by CIT(A). ................ Click here to read and download ITAT Order
“Taxsutra Database”, a true Income-tax research tool, is an archive of over112960+ Income Tax Rulings reported across ITR, CTR, Taxman, DTR, ITD, TTJ, and ITR (Trib) and also includes recent ‘unreported handpicked rulings of SC, HC & ITAT’. It is a completely integrated service with the following features:
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