Tax Annual Digest 2024: Part II

Entry Tax | Indian Made Foreign Liquor Not Taxable Under UP Entry Of Goods Into Local Area Act 2007: Allahabad High CourtThe Allahabad High Court has recently quashed assessment order taxing Indian Made Foreign Liquor under the UP Entry of goods into Local Area Act 2007 on grounds that it is not provided in the schedule to the Act. Provisional assessment order against the petitioner was passed on 19.04.2006 under Section 4-A (Realization Of Tax Through Manufacturer) of the Uttar Pradesh Entry of Goods into Local Area Tax Act, 2000 read with Rule 41(5) of the Uttar Pradesh Sales Tax Rule 2000. Final assessment order was passed on 30.03.2008 under the UP Entry of goods into Local Area Act 2007.Confiscation & Penalty Order Must Be Quashed If Quantification Of Stock Based On Eye Estimate: Allahabad High Court The Allahabad High Court has held that once the Appellate Authority has recorded a specific finding that quantification of stock was based on eye estimate and not in accordance with law, the confiscation order as well as the penalty order are liable to be set aside. “When the Appellate Authority had come to the finding that the officers in the survey did not carry out the quantification of the stock in the correct manner, there was no reason for the Appellate Authority to uphold the confiscation and penalty,” held Justice Shekhar B. Saraf.CBDT Circular Not Extending Time To File Application For Regular Registration Of New Provisionally Registered Trusts U/S 80G Violative Of Constitution: Madras High Court The Madras High Court has held that the Circular dated May 24, 2023, issued by the Central Board of Direct Taxes (CBDT) not extending time to file applications for regular registration of new provisionally registered trusts under Section 80G of the Income Tax Act is violative of the Constitution of India. The bench of Chief Justice Sanjay V. Gangapurwala and Justice D. Bharatha Chakravarthy has observed that the petitioner trusts do not have any vested right to claim an extension of time. When the statute prescribes a time limit, the petitioner trusts are expected to apply within the said date to avail themselves of the benefits. The first respondent board issues circulars enlarging the time limit even beyond the prescribed limit to mitigate the rigors of the statute and the hardship faced by the assessees. The same is in exercise of its powers under Section 119(2)(b) of the Income Tax Act. No discrimination or differentiation was made between the existing trusts and the new trusts at the first instance when Circular No. 8 of 2022 was issued. When the impugned Circular No. 6 of 2023 was issued, the reason stated by the first respondent was to mitigate genuine hardship.S.16 UPVAT Act | Invoices, RTGS Details Not Sufficient For Deciding ITC Claim, Transportation Details Must Be Produced: Allahabad High Court Placing reliance on the judgment of the Supreme Court in State of Karnataka vs. M/s Ecom Gill Coffee Trading Private Limited, the Allahabad High Court has held that input tax credit cannot be granted based solely on invoices and RTGS payment details. While dealing with Section 70 of the Karnataka Value Added Tax Act, 2003 the Supreme Court in M/s Ecom Gill Coffee Trading Private Limited held that burden to prove that claim for input tax credit and the genuineness of the transaction lies solely on the assesee. The Court held that mere production of invoices and payments made by cheques is not enough to prove that the assesee is entitled to ITC. “The dealer claiming ITC has to prove beyond doubt the actual transaction which can be proved by furnishing the name and address of the selling dealer, details of the vehicle which has delivered the goods, payment of freight charges, acknowledgement of taking delivery of goods, tax invoices and payment particulars etc. The aforesaid information would be in addition to tax invoices, particulars of payment etc,” held the Apex Court.Delhi High Court Quashes Initiation Of Section 153C Assessment Proceedings Falling Beyond Maximum 10 Years Block Period The Delhi High Court has quashed the initiation of assessment proceedings under Section 153C of the Income Tax Act, which was falling beyond the maximum 10-year block period. The bench of Justice Yashwant Varma and Justice Purushaindra Kumar Kaurav has allowed the writ petitions placed in Lists I and II and pertaining to AYs' 2010-11, 2011-12, 2012-13, and 2013-14, all of which fall beyond the maximum 10-year block period.Consideration Received By Trustees For Relinquishment Of Trusteeship Cannot Be Treated As Capital Receipt: Kerala High Court The Kerala High Court has held that consideration received by trustees for such relinquishment of trusteeship cannot be treated as a capital receipt for the purposes of assessing it under the head of capital gains; the consideration will have to be treated as the individual income of the assessees and assessed accordingly under the appropriate head. The bench of Justice A.K....

Tax Annual Digest 2024: Part II

Pankaj Bajpai