Issue No. 248 / October 8^th, 2021

Dear Professionals, 

We are glad to present to you the 248^th edition of ‘Taxsutra Database Bulletin’, where we keep you updated with current trends in the tax arena!

Status of Journals Updated 

***********************

Key Takeaways from Handpicked Rulings

1) HC observes Manish D. Jain (HUF) ruling has attained finality, follows it and allows Revenue’s appeal - HC allows Revenue’s appeal raising the substantial question of law over validity of remission of matter by ITAT to AO and shifting of onus on the AO to bring on record the role of the assessee in promoting the company and the relation of the assessee with the promoters and role ofinflating stock prices already been done by the AO and the SEBI; HC holds that that the issue covered by its earlier ruling in Manish D. Jain (HUF) in favour of the Revenue which has attained finality as no appeal has been preferred by the assessee therein or any other assessee whose case was decided similarly……………….Click here to read and download HC Judgment

2) HC: Invoking Sec. 159, holds notice u/s 133(6) served upon assessee, binding on legal heir - HC holds that proceedings can be continued against the legal representatives only when the notice has been issued in the name of the person, who is dead and that if the notice is issued to the assessee after his death, the proceedings could not be continued against the legal representatives; Dismisses writ petition against the notice u/s 133(6) issued to father of the Petitioner when the father was alive and thus, holds notice to be valid as proceedings could be continued and taken forward against the legal representatives under the provisions of Section 159; Further remarks that fresh notice will have to be issued to the legal representatives for this purpose and if there are more legal representatives apart from the Petitioner, then, the Petitioner would be at liberty to inform their names and addresses to the Revenue for bringing them on record as per the law. ……………….Click here to read and download HC Judgment

3) HC directs furnishing of AO’s report to Assessee for effective hearing on waiver of interest u/s 220(2A) - HC allows Assessee’s appeal against dismissal of writ petition against order rejecting the application for reduction or waiver of interest u/s 220(2A) decided by calling for a report from the jurisdictional AO which was not served upon the assessee;HC holds that the report of AO would constitute the basis for recording the reasons u/s 220(2A) or for rejecting the applications, thus, directs that for affording an opportunity of being heard, a copy of Assessing Officer's report is also made available to the assessee. Upon such copy being made available to the assessee, the effectiveness with which the assessee would have presented a case before the CIT would be different from presenting the case without a copy of the report submitted by the Assessing Officer or appreciating the circumstances stated against the assessee..……………….Click here to read and download HC Judgment

4) HC upholds additions u/s 68 against liquor company w.r.t. share application money - HC upholds additions to Assessee’s income u/s 68 for AY 2003-04 for not being able to substantiate the genuineness of receipt of share application money; Assessee, a private limited company engaged in the business of manufacture of Indian Made Foreign Liquor, was assessed pursuant to a search operation; Revenue denied the claims of Assessee that it had filed the necessary documents with the Registrar of Companies and furnished all the details with the Revenue; Held that that merely filing the identity of the shareholders or the share applicants and the mode of receipt of amounts would not amount to discharging the onus cast upon the Assessee; Revenue had also summoned company's directors, the promoter-director, the former managing director and the vice president, u/s 131 and observed from their statements that there was no transparency in the control and administration and ownership of the company and noted that the share capital was introduced in the company through ……………….Click here to read and download HC Judgment

5) ITAT: Deduction u/s 10B cannot be withdrawn for subsequent years if there is no change in facts and circumstances of the case. Assessee-Individual, engaged in export of Information Technology Enabled Services from a Software Technology Park and was disallowed the claim of deduction u/s 10B for the AY 2009-10; ITAT notes that the assessee was allowed deduction u/s 10B on the same activity for assessment year 2003-04 to 2008-09. Even in assessment year subsequent to the present assessment year i.e. AY 2010-11 also, the assessee has been allowed the deduction u/s 10B. In such circumstances, ITAT holds that there was no reason to justify disallowing the deduction only in the year under consideration by the AO, follows SC ruling in Excel Industries on rule of consistency…………Click here to read and download ITAT Order

6) HC : Permits assessees to file applications before Interim Board of Settlement; Considers plea that date of search is ‘critical’ - In a writ petition challenging the abolition of the Settlement Commission, HC permits assessees to carry their applications before the Interim Board of Settlement as per CBDT Press Release and CBDT Order dt. Sep 28, 2021 that permits applications to be filed by Sep 30, 2021;  Considers assessee’s submission that the date that is critical is the date when the search took place and not the date of issuance of notice, particularly since the applications preferred by other persons who were simultaneously searched were taken on record by the Settlement Commission ; Clarifies that this order only permits the applications to be filed and maintainability of the applications and the merits of the individual cases will be completely open to the Interim Board to pass appropriate orders……………Click here to read and download HC Order

***********************

Expert Column 

In this article, authors CA Dindayal Dhandaria and CA Naveen Kumar Dhandaria, conduct a reality check on these messages to bring out the actual truth behind it. Explains section 139A(5)(c) r.w.r 114B that it provides “all the sellers raising an invoice of Rs 2,00,000 or more should mention the 10-digit PAN number of vendor & customer on each such invoice wef 01.10.2021 onwards along with verification of such PAN as per Rule 114C.” Giving a brief background about the Rules 114B and 114C and the relevant provision of section 139A(5)(c), elucidates the provision with an illustration that how a person needs to quote his PAN in the capacity of a purchaser and a seller. Explains that the Rules 114B and 114C were inserted in the year 1998 and were amended several times upto the year 2015 and similarly no changes were made in section 139A(5)(c) as well, after January 01, 2016. States that section 139A(6) was inserted by Finance (No.2) Act, 2019 with further amendments w.e.f. 1.9.2019 by inserting sub-sections (6A) and (6B), which however, do not impact the requirement of quoting PAN as laid down in section 139(5)(c). Thus, the authors conclude “…requirement to quote PAN of both the vendor and the purchaser in the prescribed documents is prevailing since 1-1-2016 and not since 1-10-2021 as is being circulated through recent WhatsApp messages.”

***********************

Lot's more at Taxsutra Database 

Access all “Taxsutra Database Newsletters”, in case you have missed any! 

Access latest News....and more!

----------------------------------------------------------------------------------------------

About Taxsutra Database!

“Taxsutra Database”, a true Income-tax research tool, is an archive of over 114010+ 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: 

• Comprehensive coverage of all latest cases powered by an advanced search engine to provide a seamless user experience;

• Effective search results supported by active filters around Court Level, Location, Case Numbers and Citation;

• Enhanced search feature, using the Unique Bulls Eye Application, by including "Exact words", "Any of these", "none of these" options.  

• Judicial “forward & backward reference”

The Taxsutra Database comes at a very special Annual Subscription price of 4200+ GST AND includes an annual license to the Taxsutra Library.

Click Here to Sign up, make payment and join the Taxsutra Family. 

Copyright © TAXSUTRA. All Rights Reserved