Tax
Interest On Delayed Customs Duty Is Compensatory In Nature And Hence Allowable Expenditure U/S 37(1): Bangalore ITAT
Finding that the interest payment is incurred wholly & exclusively for business purposes, and is neither personal nor capital in nature, the Bangalore ITAT held that interest on delayed customs duty cannot be treated at par with penalty.The ITAT therefore clarified that such interest payment is an accretion to the main payment and not penalty, and hence, allowable as revenue expenditure...
SCN Was 'Gloriously Silent' On Provisions Of GST Act Which Were Allegedly Infringed: Delhi High Court Quashes Order
Finding that the SCN as well as the final order fails to provide any clue with respect to the provision of the statute which was alleged to have been violated or infringed, the Delhi High Court quashes the SCN & the order of cancellation of GST registration. “The SCN is gloriously silent with respect to the provisions of the GST Act which are alleged to have been...
Value Of Free Fuel Can't Be Added To Value Of Taxable Supply U/S 15 Of CGST Act: Uttarakhand HC
The Uttarakhand High Court held that when as per the agreement, the cost of fuel was to be borne by recipient, then such cost cannot be subjected to charge of GST by adding its value in the transaction value of GTA service.Pointing that the cost of fuel cannot be added in the account of the transporter, as was governed by the GST rules, the Division Bench comprising Justice Ritu Bahri and...
Rejection Of Application For Voluntary Cancellation Of GST Registration Didn't Contain Reasons: Bombay HC Quashes Rejection Order
The Bombay High Court ruled that since the revocation orders for registration cancellation on petitioner's application were passed contrary to principles of natural justice, all the subsequent proceedings initiated thereafter, which are consequential, shall be quashed.“Before the revocation of cancellation of registration, the Petitioner was not supplied with the documents on the basis of...
Failure Of AO To Conduct Enquiry, Summarily Disallowing Expenses Was Mechanically Endorsed By CIT(A) & ITAT: Bombay HC Quashes Assessment
Observing that a mechanical approach & tactically equitable approach of convenience cannot be endorsed, the Bombay High Court quashes the ITAT's order, upholding an ad-hoc disallowance of 10% of expenses alleging as bogus purchases despite returning a firm finding that the AO's order was untenable, The High Court outlined that once a categorical observation is rendered by...
Notice Issued U/S 148A(B) Of Income Tax Act Against Dissolved Firm Is Not Valid: Gujarat High Court
The Gujarat High Court stated that notice issued under section 148A(b) of the Income Tax Act, 19861 against dissolved firm is not valid. The Division Bench of Justices Bhargav D. Karia and Mauna M. Bhatt was dealing with a case where the Assessing Officer/respondent issued an impugned notice under Section 148A(b) of the Income Tax Act, 1961, in the name of the partnership firm and...
Rectification Order Not Sustainable If It Fails To Provide Reasons Justifying Exercise Of Rectification Power: Kerala High Court
The Kerala High Court stated that rectification order is not sustainable if does not provide any reason justifying exercise of power of rectification. The Bench of Justice Gopinath P. observed that “….personal hearing notice does not indicate that any reason justifying the exercise of power of rectification was pointed out to the assessee. Therefore, the assessee is right...
Taxpayer Can't Make Fresh Claim Of Deduction U/S 80IA In Response To Notice U/S 153A After Search In Unabated Assessment: Hyderabad ITAT
The Hyderabad ITAT ruled that the assessee cannot make a fresh claim of deduction under Chapter VI-A of the Income Tax Act, for the first time, in the return of income filed in response to notice issued u/s 153A, pursuant to search conducted u/s 132 of the Act, in unabated/completed assessment as on the date of search. However, in case of abated assessments, like the AO who can make...
Dept Can't Justify Retention Of Refund Claim On Account Of Having Been Deposited Voluntarily By Taxpayer: Delhi HC
The Delhi High Court held that when the payment of refund was delayed, the assessee automatically becomes entitled to interest u/s 42 of the DVAT Act. After the assessee succeeds in vindicating its stand that its claim for refund was correct, it would follow that that the assessee would be refunded the amount claimed and interest would be payable, added the High Court. The High...
Failed To Comply With S.23(4) Of MVAT Act Along With Non-Application Of Mind & Legal Malafide: Bombay HC Quashes Assessment, Imposes 50K Cost On Dept
While considering a case where the Commercial tax department has flagrantly breached the statutory provisions of Sec 23(4) of the MVAT Act, the Bombay High Court ruled that assessment order passed by Commissioner of Sales tax is vitiated by total non-application of mind. Since a strong prima facie case is made out about manipulating the date of passing the assessment order, the High...
S. 68 Of Income Tax Act Not Attracted When There Is No Unexplained Amount In Bank Statement: Gujarat High Court
The Gujarat High Court stated that there cannot be any income escapement by the assessee if there is no unexplained amount in the bank statement on record. The Bench of Justice Bhargav D. Karia and Mauna M. Bhatt observed that “the reason given by the Assessing Officer for alleged escapement of Rs.3,25,00,000/- is not sustainable since there is no unexplained amount in...
Credit Cannot Be Blocked In Electronic Credit Ledger If Sufficient Balance Not Available: Gujarat High Court
The Gujarat High Court stated that there cannot be any blocking of the credit in electronic credit ledger if there is no sufficient balance available. The Division Bench, comprising Justices Bhargav D. Karia and Niral R. Mehta, was hearing a case where the assessee contested the blocking of Input Tax Credit (ITC) amounting to ₹2,44,05,567 in its electronic credit ledger....