Direct Tax Cases Weekly Round-Up: 12 To 18 May 2024

Delhi High CourtAO Can't Proceed With Assessment In Absence Of Section 127 Transfer Order: Delhi High CourtCase Title: Rajsheela Growth Fund (P) Ltd. Versus ITOThe Delhi High Court has held that the Assessing Officer cannot proceed with assessment in the absence of a transfer order under Section 127 of the Income Tax Act.Bombay High CourtMerely Brandishing Newspaper Cuttings Doesn't Prove Sharing Commercial Expertise: Bombay High CourtCase Title: Hindustan Export & Import Corporation Private Limited Versus The Deputy Commissioner of Income-taxThe Bombay High Court has held that merely brandishing newspaper cuttings does not amount to proof of sharing commercial expertise with its French counterpart as mandated by Section 80-O of the Income Tax Act.AO Can't Draw An Adverse Inference For Mere Non-Response From Directors To Notices: Calcutta High CourtCase Title: Principal Commissioner Of Income Tax Vs Atlantic Dealers Pvt. Ltd.The Calcutta High Court, while deciding whether the addition made under Section 68 of the Income Tax Act, 1961, was justified or not, held that only because the directors failed to respond to the notices issued, the Assessing Officer could draw an adverse inference.No Change In Opening And Closing Stock Of NCDs; Bombay High Court Quashes Reassessment NoticeCase Title: Upesi Ventures Ltd. Versus The Assistant Commissioner of Income TaxThe Bombay High Court has quashed the reassessment notices as there was no change in the opening and closing stock of the non-convertible debts (NCDs).Allahabad High CourtS.144B(6) Income Tax Act | If Assessee “Requests” Then Opportunity Of Personal Hearing Is Mandatory, Not Optional: Allahabad High CourtCase Title: Satish Kumar Bansal Huf v. National Faceless Assessment Centre Nafac And Another The Allahabad High Court has held that opportunity of personal hearing is mandatory under Section 144B(6)(vii) and (viii) of the Income Tax Act, 1961 when show cause notice is issued regarding why assessment may not be completed as proposed. The Court held that once the assesee “requests” for an opportunity of personal hearing, it becomes incumbent on the Assessing Authority to grant that opportunity under Section 144B(6)(viii).Calcutta High CourtInvestment Made From Share Premium Without Any Noticeable Business Activity, Legitimacy Of Income Not Established: Calcutta High CourtCase Title: Balgopal Merchants Private Limited Versus The Principal Commissioner Of Income Tax -2, KolkataThe Calcutta High Court has held that the source of investments by those two companies is also the share capital and share premium raised by them while issuing their own shares to other closely held companies, and those companies had no noticeable business activities.ITATLoss Due To Sale Of Government Securities By Bank Is “Business Loss”; ITAT Allows Income Tax DeductionCase Title: Kankaria Maninagar Nagarik Sahakari Bank Ltd. Versus Deputy Commissioner of Income TaxThe Ahmedabad Bench of Income Tax Appellate Tribunal (ITAT) has held that loss due to the sale of government securities by banks is a “business loss” and the income tax deduction is allowable under Section 37 of the Income Tax Act.SBI Not Liable To Deduct TDS On Transactions Related To Assignment Of Loans By NBFC: ITATCase Title: State Bank of India Versus DCIT(TDS)The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has held that the State Bank of India (SBI) is not liable to deduct tax at source (TDS) on transactions related to the assignment of loans by non-banking financial companies (NBFC).Mark-To-Market Loss, Loss On Forward Contracts, Loss On Forward Premium Account Not Speculative In Nature, ITAT Deletes AdditionCase Title: DCIT Versus J. K. Techno soft Ltd.The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has deleted the income tax addition and held that mark-to-market losses, losses on forward contracts, and losses on forward premium accounts are not speculative in nature.

Direct Tax Cases Weekly Round-Up: 12 To 18 May 2024

Mariya Paliwala

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