Tax Cases Weekly Round-Up: 12 June To 18 June, 2022

Delhi High CourtDelhi High Court Quashes Assessment Order For Not Giving Opportunity To File Objection To SCN Case Title: Jindal Exports and Imports Private Limited Vs DCIT The Delhi High Court bench of Justice Manmohan and Justice Dinesh Kumar Sharma has quashed the assessment order as the assessee was not given an opportunity to file an objection to the show cause notice. Underreporting Of Income Due To Re-Computation Of Disallowance By The AO, Does Not Amount To Misreporting Of Income: Delhi High Court Case Title: Prem Brothers Infrastructure LLP. versus National Faceless Assessment Centre & Anr. Citation: 2022 LiveLaw (Del) 568 The Delhi High Court has ruled that where the underreporting of income allegedly done by the assessee is due to the re-computation of the disallowance under Section 14A of the Income Tax Act, 1961 by the Assessing Officer, it would not amount to misreporting of income. The Bench, consisting of Justices Manmohan and Manmeet Pritam Singh Arora, observed that the underreporting of income by the assessee was due to the increase in the disallowance made under Section 14A, which was voluntarily estimated by the assessee and later recalculated by the Assessing Officer on the basis of the same material. Notice Issued Under Section 148 Of The Income Tax Act Against A Deceased Assessee Is Invalid : Reiterates Delhi High Court Case Title: Davinder Singh Thapar versus Assistant Commissioner of Income Tax & Anr. Citation: 2022 LiveLaw (Del) 575 The Delhi High Court has reiterated that a notice issued under Section 148 of the Income Tax Act, 1961, on the ground of escapement of income from assessment, against a deceased assessee is invalid in law. The Division Bench of Justices Jyoti Singh and Anoop Kumar Mendirattaobserved that though the notices were issued by the revenue authorities pursuant to an order of the Supreme Court, however, the said order did not deal with the issue of whether the notices could be issued against the deceased assesses. Therefore, the Court quashed the notices issued by the revenue authorities against the deceased assessee. Bombay High Court Services Rendered Abroad Amounts to Export Of Services, No GST Applicable: Bombay High Court Case Title: Jar Productions Private Limited Versus The Union of India & Ors. The Bombay High Court has held that GST does not apply to the services rendered abroad as they amount to the export of services. The division bench of Justice S.V. Gangapurwala and Justice M.G. Sewlikar has allowed the GST refund to the petitioner/assessee as the department has failed to establish that the incidence of tax was passed on to the client amounted to unjust enrichment. Madras High Court Order Of ITAT Is Based On Evidence, Findings Based On Facts,Madras High Court Dismisses Tax Appeal The Madras High Court recently dismissed a tax appeal observing that there were no substantial question of law arisen for consideration. The bench of Justice R Mahadevan and Justice Sathya Narayana Prasad were of the opinion that the order passed by the Commissioner of Income Tax (Appeals) which was confirmed by the Income Tax Appellate Tribunal was based on the evidence adduced before the same. "Such well-considered findings of the appellate authorities do not warrant any interference at the hands of this court", it observed. Royalty Income Should Be Excluded From Business Profits For Calculating Deductions U/S 80 HHC Of Income Tax Act: Madras High Court Case Title: M/s. Fenner (India) Limited v. The Assistant Commissioner of Income Tax Citation: 2022 LiveLaw (Mad) 251 The Madras High Court recently upheld the decision of the Income Tax Appellate Tribunal directing the assessing officer to exclude the royalty income from the business profits for the purpose of calculation of deductions under Section 80HHC of the Income Tax Act. Justice R Mahadevan and Justice Sathya Narayana Prasad observed that the appellant could not produce concrete evidence to assert that the royalty income received from a subsidiary company was related to export business. Thus, the decision of the tribunal did not warrant any interference. Failure Of Proper Officer Detaining Vehicle To Issue Notice: Madras High Court Directs Release Of Vehicle And Goods Case Title: Tvt.LAF Enterprises Versus Commissioner of Commercial Tax The Madras High Court bench of Justice Anitha Sumanth has held that Section 129 of the CGST Act provides for the detention and seizure of the vehicle upon condition that an order of detention/seizure shall be passed at the time of detention/seizure and duly served upon the person transporting the goods. Period Of Limitation Under S.153 Of Income Tax Act Applies To Remand Proceedings : Madras HC Case Title: The Commissioner of Income Tax and Anr v. M/s. Roca Bathroom Products Private Limited Citation: 2022 LiveLaw (Mad) 252 The...

Tax Cases Weekly Round-Up: 12 June To 18 June, 2022

Mariya Paliwala

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