Direct Tax Half Yearly Digest: January To June 2024 - PART II

Update: 2024-07-10 12:15 GMT
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Kerala High CourtAssessee Can't Indefinitely Seek Time In Response To SCN: Kerala High CourtCase Title: Shaju Pachelil Pathrose Versus Additional/Joint/Deputy/Assistant Commissioner Of Income TaxCitation: 2023 LiveLaw (Ker) 12The Kerala High Court has held that the assessee cannot indefinitely seek time in response to a show cause notice.Writ Petition Challenging Orders Of Tamil Nadu...

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Kerala High Court

Assessee Can't Indefinitely Seek Time In Response To SCN: Kerala High Court

Case Title: Shaju Pachelil Pathrose Versus Additional/Joint/Deputy/Assistant Commissioner Of Income Tax

Citation: 2023 LiveLaw (Ker) 12

The Kerala High Court has held that the assessee cannot indefinitely seek time in response to a show cause notice.

Writ Petition Challenging Orders Of Tamil Nadu Assessing Authority Not Maintainable Merely For Having A Bank Account In Kerala: Kerala High Court

Citation: 2024 LiveLaw (Ker) 218

Case Title: Manaf Ali Hassan Versus The National Faceless Assessment Centre

The Kerala High Court has held that the writ petition challenging orders of Tamil Nadu assessing authority is not maintainable merely for having a bank account in Kerala.

Assessment Can Be Reopened Based On Audit Objections Under New Reassessment Regime: Kerala High Court

Case Citation: 2024 LiveLaw (Ker) 219

Case Title: M/S Sree Narayana Guru Memorial Educational And Cultural Trust Versus The Assistant Commissioner Of Income Tax

The Kerala High Court has held that assessments can be reopened based on audit objections under a new reassessment regime.

Affording Personal Hearing Is Mandatory In An Enquiry Under Section 148A(B) Of Income Tax Act: Kerala High Court

Case Citation: 2024 LiveLaw (Ker) 222

Case Title: The Income Tax Officer Ward Versus Vazhakkulam Block Rural Co-Operative Society Ltd.

The Kerala High Court has held that affording a personal hearing to the assessee is mandatory in an inquiry under Section 148A(b) of the Income Tax Act.

Land Used For Agricultural Purposes Yielding Agricultural Income Is Exempted From Income Tax: Kerala High Court

Citation: 2024 LiveLaw (Ker) 230

Case Title: Mini Muthoottu Credit India (P) Ltd. Versus Commissioner Of Income Tax

The Kerala High Court has held that the land in question was used for agricultural purposes, which yielded agricultural income, which in turn was exempt from income tax under Section 10(1) of the Income Tax Act.

Counter Sales Permission Of Alcoholic Liquor Was Concession Given To Bar Attached Hotel Owners For Carrying On Business During Covid-19: Kerala High Court

Case Title: Lukose. K.C. Versus Deputy Commissioner

The Kerala High Court has held that the permission to effect over-the-counter sales of alcoholic liquor was a concession given to bar-attached hotel owners to permit them to carry on business and tide over the COVID lockdown period. The assessee cannot now contend that the tax on such transactions should not be levied on him because he did not originally have permission to effect such sales.

Financial Activity Can't Glissade Into Situation Where Its Operations Become Impossible: Kerala HC Issues Directions On Status Of Nidhi Companies

Case Title: Annamanada Gramakshemam Nidhi Limited verses UOI

The Kerala High Court recently held that any financial activity ought to be regulated reasonably within the ambit of law, and it cannot glissade into a situation where its operations become impossible, or are defeated by oppressive or impossible restrictions and regulations.

Additional Income Can't Be Treated As Concealed Income: Kerala High Court

Case Title: The Principal Commissioner Of Income Tax Versus Shri. Ambady Krishna Menon

The Kerala High Court has held that additional income cannot be treated as concealed income for the purposes of Section 271(1)(c) of the Income Tax Act.

Expenditure Incurred By Way Of Addition To Buildings, Electrical Fittings On Leasehold Premises Is Capital Expenditure: Kerala High Court

Citation: 2024 LiveLaw Ker 312

Case Title: Hotel Allied Trades Pvt. Ltd Versus The Additional Commissioner Of Income-Tax

The Kerala High Court has held that the expenditure that was incurred by the appellant/assessee by way of addition to buildings and electrical fittings on leasehold premises was in the nature of capital expenditure and not revenue expenditure.

Opening And Closing Stock Of The Year Is To Be Valued By Applying Same Methodology: Kerala High Court

Citation: 2024 LiveLaw Ker 311

Case Title: P. A. JOSE Versus UOI

The Kerala High Court has held that the stipulation under Clause 16 of the Income Computation and Disclosure Standards (ICDS) for the adoption of first-in, first-out (FIFO) or weighted average cost for valuation of the stock or inventory cannot be applied in the Assessment Year 2017-2018 for the valuation of the opening stock, as the opening and closing stock of the year are to be valued by applying the same methodology.

Gujarat High Court

S. 80IA(4) Deduction Available To Assessee Engaged In Developing Infrastructure Projects Like Roads, Canals: Gujarat High Court

Case Title: The Principal Commissioner Of Income Tax (Central), Versus Montecarlo Construction Ltd.

LL Citation: 2024 LiveLaw (Guj) 3

The Gujarat High Court has allowed the deduction under Section 80IA(4) of the Income Tax Act to the assessee engaged in developing infrastructure projects like roads, canals, etc.

Income Tax Act | Gujarat High Court Invalidates Income Tax Assessment Order Due To Violations Of Section 144B

Case Title: Dhvanil Hemendra Reshamwala Versus Income Tax Officer, Ward 1(3)(1)

LL Citation: 2024 LiveLaw (Guj) 2

In a significant legal development, the Gujarat High Court has invalidated an Income Tax Assessment Order, citing violations of Section 144B of the Income Tax Act.

Income Tax Act | Section 119(2)(B) Application Cannot Be Rejected Citing Vague & Arbitrary Reasons

Case Title: M/S AMIT HOSPITAL PVT. LTD. Versus PRINCIPAL COMMISSIONER OF INCOME TAX

LL Citation: 2024 LiveLaw (Guj) 1

In a recent ruling, the Gujarat High Court has emphasized that applications under Section 119(2)(b) of the Income Tax Act, 1961 must not be dismissed arbitrarily, especially when citing the absence of genuine hardship to the petitioner.

Gujarat High Court Upholds Income Tax Department's Search and Seizure, Condemns Misconduct

Case Title: Maulikkumar Satishbhai Sheth vs Income Tax Officer, Assessment Unit, Ahmedabad

LL Citation: 2024 LiveLaw (Guj) 8

The Gujarat High Court on Tuesday, upheld the search and seizures conducted by the Income Tax (I-T) department at a lawyer's residence and office last year over alleged income tax evasion as valid.

Gujarat High Court Quashes Demand Notice And Assessment Order In Absence Of Any Claim Not Forming Part Of Resolution Plan

Case Title: Surya Exim Limited Thro Director Bhawani Singh Versus Union Of India & Ors.

LL Citation: 2024 Livelaw (Guj) 42

The Gujarat High Court has quashed the demand notice and assessment order in the absence of any claim not forming part of the resolution plan (RP).

Calcutta High Court

Income From Sub-Letting Is 'Business Income' If Object Is Business Of Renting/Licensing Of Shops: Calcutta High Court

Citation: 2023 LiveLaw (Cal) 19

Case Title: Oberoi Building & Investment (P) Limited verses CIT and Another

Finding that assessee's income from sub-letting/sub-licensing the space in question, has always been accepted by Respondent / Income Tax Department as income from business, the Calcutta High Court held that assessee's income from sub-licensing/sub-letting is chargeable to tax as business income and not as income from house property.

Assessee Attempted To Drag Matter Knowing Well That Assessment Will Be Time Barred: Calcutta High Court Upholds Reassessment

Citation: 2023 LiveLaw (Cal) 22

Case Title: Champa Impex Private Limited Versus Union Of India And Others

The Calcutta High Court has held that the assessee had repeatedly sought adjournments, which would show that the assessee attempted to drag the matter along, knowing well that the assessment would be time-barred.

AO's Failure To Make Proper Enquiry On Bogus Claim Of LTCG By Sale Of Shares; Calcutta High Court Upholds Revision Order

Case Title: Principal Commissioner Of Income Tax-9, Kolkata Vs. Bina Gupta

The Calcutta High Court has upheld the revision order passed by the Principal Commissioner of Income Tax (PCIT) under Section 263 of the Income Tax Act, as the AO failed to make a proper inquiry on the bogus claim of long-term capital gain (LTCG) by the sale of shares.

Calcutta High Court Upholds Quashing Of CIT's Order Speculating Possibility Of Understatement In Closing Stock Without Specific Finding

Case Title: Commissioner Of Income Tax Versus Gopal Sharma

The Calcutta High Court has upheld the quashing of an order passed by the CIT speculating on the possibility of understatement in closing stock without a specific finding.

Conduct Of Enquiry As Per Sec 148A Is Not Mandatory But Discretionary: Calcutta HC Upheld Reopening Proceeding

Case Title: Champa Impex Private Limited Verses Union of India

Pointing that the information which was furnished to the assessee though contained information pertaining to the three assessment years, the information called for in the notice dated Mar 31, 2023 pertained only to the assessment year 2016-17, the Calcutta High Court upheld the reassessment proceedings despite the fact that Section 148A(b) notice issued for AY 2016-17 was accompanied with annexure containing information for multiple AYs.

Provisions Of Section 148 Under Old Regime Including TOLA Can't Be Applied To New Regime: Calcutta High Court

Case Title: M/s Arati Marketing Pvt. Ltd. Vs Union of India & Ors.

The Calcutta High Court has held that if the provisions of the old regime of Section 148 of the Income Tax Act, including Taxation and other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA), are read into or applied to the new regime applicable from 01.04.2021, it would also necessarily mean that a provision repealed by the Parliament without any savings and exception clause is applied by the department even after its life has come to an end, which is clearly not permissible in law.

Tested Party Normally Should Be Least Complex Party To Controlled Transaction, Reiterates Calcutta High Court

Case Title: PCIT vs ITC INFOTECH INDIA LIMITED

The Calcutta High Court reiterated that the selection of the tested party is to further the object of the comparability analysis by making it less complex and requiring fewer adjustment.

Assessee's Failure To Establish Genuineness Of Transaction With Cogent And Credible Evidence, Calcutta High Court Upholds Addition

Case Title: The Principal Commissioner Of Income Tax, (Central) -2, Kolkata Versus M/S. BST Infratech Limited

The Calcutta High Court has held that merely proving the identity of the investors does not discharge the onus on the assessee if the capacity or credit worthiness has not been established.

Payments By Supervisors To Individual Labourers, Each Not Exceeding Rs. 20,000, Can't Be Disallowed: Calcutta High Court

Case Title: SK. Jaynal Abddin Versus Commissioner Of Income Tax, Kolkata

The Calcutta High Court has held that payments by supervisors to individual labourers, each not exceeding Rs. 20,000, cannot be disallowed under Section 40A(3) of the Income Tax Act, 1961.

AO Can't Draw An Adverse Inference For Mere Non-Response From Directors To Notices: Calcutta High Court

Case 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.

Investment Made From Share Premium Without Any Noticeable Business Activity, Legitimacy Of Income Not Established: Calcutta High Court

Case Title: Balgopal Merchants Private Limited Versus The Principal Commissioner Of Income Tax -2, Kolkata

The 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.

Income Tax Dept. Failed To Incorporate Revised CPWD Rates As Quantum Of Rent For Building: Calcutta High Court

Case Title: Principal Commissioner Of Income Tax, Asansol Versus Sri Manoj Parmar And Others

The Calcutta High Court has held that the income tax department was delaying the matter for a prolonged period and failed to incorporate the revised Central Public Works Department (CPWD) rates as the quantum of rent for the building.

Share Application Money Or Repayment Doesn't Attract Penalty Section 269SS And 269T: Calcutta High Court

Case Title: Commissioner Of Income Tax, Central-Iii, Kolkata Versus M/S. Vamshi Chemicals Ltd.

The Calcutta High Court has held that if the share application money is neither a loan nor a deposit, then neither Section 269SS nor 269T of the Income Tax Act, 1961 shall apply. Consequently, no penalty, either under Section 271D or under Section 271E of the Income Tax Act, 1961, could be imposed.

Karnataka High Court

Revised Returns Filed Waiving Claim And Paid Taxes: Karnataka High Court Quashes Section 276C(1) Prosecution For Wilful Tax Evasion

Case Title: Anurag Bagaria Versus The Income Tax Department

Citation: 2024 LiveLaw (Kar) 52

The Karnataka High Court has quashed the prosecution under Section 276C(1) of the Income Tax Act for wilful tax evasion.

After Amendment Mere Reason To Believe Can't Be Ground For Carrying Out Reassessment: Karnataka High Court

Case Title: Smt. Vasanthi Ramdas Pai Versus Income Tax Officer

The Karnataka High Court has held that the Assessing Officer has to be prima facie satisfied that there is “escapement of income”, unlike earlier law which permitted action based on mere reason to believe. Now mere reason to believe, cannot be a ground for carrying out assessment under section 147 of the Income Tax Act.

Average Income Is To Be Considered If Variations Found In Income Tax Returns Filed By Claimant: Karnataka High Court

Citation No: 2024 LiveLaw (Kar) 141

Case Title: Jayashree AND Mahaningappa & Others

The Karnataka High Court has held that if income tax returns are available the same should be considered as best a piece of evidence and if variations are found in the income tax returns, considered for different assessment years, it would be appropriate to consider the average income of three assessment years to arrive at the annual stable income of the claimant seeking compensation under the Motor Vehicles Act.

Patna High Court

Appellate Authority Cannot Dismiss Appeal For Non-Prosecution Due To Non-Appearance Of Assessee Or Authorized Representative: Patna High Court

Case Title: M/s Nav Nirman Construction vs The Union of India & Ors LL

Citation: 2024 LiveLaw (Pat) 4

The Patna High Court has observed that the appellate authority is not empowered to dismiss the appeal for non-prosecution due to the non-appearance of the Assessee or authorized representative as the appellate authority has a duty and obligation to take into consideration the merits of the matter, examine the grounds raised by the appellant even if the appellant or authorized representative presence is not recorded; and decide the issue on merits.

'No Reason To Interfere With The Levy Of Tax On The Sale Of 'Korai'': Patna High Court

Case Title: M/s Raj Kumar Sao Kishori Lal Sao vs The State Of Bihar & Ors

LL Citation: 2024 LiveLaw (Pat) 7

In a recent ruling, the Patna High Court has upheld the imposition of tax on the sale of 'Korai,' a processed by-product used as cattle feed.

Rajasthan High Court

Unreasoned Orders By Judicial/ Quasi-Judicial Authorities Violate Natural Justice: Rajasthan High Court Quashes Commercial Tax Assessment Order

Title: M/s Napin Impex Pvt. Ltd. v Commissioner, Commercial Taxes Department, Kar Bhawan, Ambedkar Circle, Janpath, Jaipur

Citation: 2024 LiveLaw (Raj) 117

The Rajasthan High Court has set aside an assessment order passed by the Commissioner, Commercial Taxes Department, Jaipur (“CCT”) under the Rajasthan Value Added Tax Act, 2003. The Court observed that the assessment order was unreasoned and was passed without any application of mind, violating the principles of natural justice.

Once Deduction Claim Of Education Cess Is Withdrawn, Assessee Immuned From Imposition Of Section 270A Penalty: Rajasthan High Court

Case Title: G R Infraprojects Limited Versus Assistant Commissioner Of Income-Tax

Citation: Citation: 2024 LiveLaw (Raj) 3

The Rajasthan High Court has held that once the deduction claim for education cess is withdrawn, the assessee is immune from the imposition of a penalty under Section 270A of the Income Tax Act.

Dept.'s Action Denying Immunity Benefit Merely Because Section 270A Penalty Was Initiated Is Erroneous: Rajasthan High Court

Case Title: Chambal Fertilizers and Chemicals Limited Versus Office of the Principal Commissioner of Income Tax

Citation: Citation: 2024 LiveLaw (Raj) 4

The Rajasthan High Court has held that the department's action of denying the benefit of immunity on the ground that the penalty was initiated under Section 270A of the Income Tax Act for misreporting of income is not only erroneous but also arbitrary and bereft of any reason, as in the penalty notice, the respondents have failed to specify the limb, "under-reporting" or "misreporting" of income, under which the penalty proceedings had been initiated.

Time Of Accrual For Taxing Income Gets Postponed Till Adjudication Of Dispute By Civil Court: Rajasthan High Court Stays Demand Order

Case Title: Lalit Kumar Kothari Versus National Faceless Assessment Centre & Anr.

The Rajasthan High Court has stayed the penalty order and consequential demand notices passed under Section 270-A and Section 156 of the Income Tax Act, respectively.

Differentiation Between Government Employees And Other Employees For Leave Encashment Exemption Not Violative Of Article 14: Patna High Court

Case Title: Purnendu Shekhar Sinha Versus The Union Of India

LL Citation: 2024 LiveLaw (Pat) 23

The Patna High Court has held that differentiation between government employees and other employees for leave encashment exemption is neither discriminatory nor violative of Article 14 of the Constitution of India.

Generation Of Surplus From Year To Year Cannot Be Bar For Trust In Seeking Section 10 (23C) (vi) Exemption: Rajasthan High Court

Case Title: Chandigarh Manav Vikas Trust Versus Chief Commissioner Of Income Tax

The Rajasthan High Court has held that the assessee is being run as a trust solely for educational purposes, thus seeking the exemption under Section 10(23C)(vi) of the Income Tax Act of 1961, and the generation of surplus from year to year cannot be a bar in seeking such an exemption under the provision of law.

For Establishing Offence Of Filing Delayed ITR, “Mens Rea” Is A Necessary Ingredient: Rajasthan High Court

Case Title: The Income Tax Officer Versus Rajendra Prasad Vaish

Citation: 2024 LiveLaw (Raj) 88

The Rajasthan High Court has held that for holding an assessee guilty of the offence of filing delayed income tax returns, “mens rea“ is a necessary ingredient.

Andhra Pradesh High Court

Andhra Pradesh High Court Directs Municipal Corporation To Decide Representation On Waiver Of Interest On Property Tax Arrears

Case Title: S.v.v.estates (swarna Palace) Versus The State Of Andhra Pradesh and Others

The Andhra Pradesh High Court, while restraining the Municipal Corporation from taking coercive steps against the petitioner, directed the corporation to decide representation on a waiver of interest on property tax arrears.

Income Tax Not Leviable On Interest-Free Refundable Security Deposit For Due Completion Of Project By Developer: Andhra Pradesh High Court

Case Title: M/s Coastal Ceramics and Clay Works Private Ltd. Versus UOI

The Andhra Pradesh High Court at Amaravati has held that income tax is not leviable on an interest-free refundable security deposit for the due completion of a project by the developer.

Consideration Received By Trustees For Relinquishment Of Trusteeship Cannot Be Treated As Capital Receipt: Kerala High Court

Case Title: The Principal Commissioner Of Income Tax Versus Gracy Babu

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.

Prerogative Of Govt. To Fix Income Limit For Encashment Of Earned Leave Salary For Income Tax Exemption: Kerala High Court

Citation: 2024 LiveLaw (Ker) 364

Case Title: Balan Panicker Ramesh Kumar Versus Union Of India

The Kerala High Court has held that it is the prerogative of the government to fix the limit of income from the encashment of earned leave salary for the purposes of exemption from payment of income tax. Unless the government issues a notification fixing the limit of income for earned leave salary, an employee cannot claim exemption from payment of income tax on the encashment of earned leave for up to 300 days.

Failure Of Assessee To Update E-Mail Address With Dept.; Kerala High Court Dismisses Writ Petition Challenging Demand Notice

Citation: 2024 LiveLaw (Ker) 363

Case Title: Lakeshore Hospital And Research Centre Limited Versus The Additional/Joint/Deputy/Assistant Commissioner Of Income Tax/ Income Tax Officer, National Faceless Assessment Centre

The Kerala High Court has dismissed the writ petition challenging the assessment order and notice of demand on the grounds that they were issued in violation of the principles of natural justice.

Delay In Approaching Revision Authority Under Income Tax Act Can't Be Condoned: Kerala High Court

Citation: 2024 LiveLaw (Ker) 366

Case Title: Equity Intelligence India Pvt. Ltd Versus PCIT

The Kerala High Court has held that the delay in approaching the revision authority under the Income Tax Act cannot be condoned.

Absence Of Incriminating Materials, AO Not Empowered To Reopen Assessments In Block Period Of Six Years: Kerala High Court

Citation: 2024 LiveLaw (Ker) 369

Case Title: M/S. Sunny Jacob Jewellers Gold Hyper Market Versus CIT

The Kerala High Court has held that based on the material obtained during the search, the Assessing Officer, who gets the jurisdiction to re-open the assessments, can do so in respect of the individual assessment years comprised in the block period of six years only if the material obtained during the search under Section 132 of the Income Tax Act, or any part thereof, relates to the assessment year in question.

Credit Available On Advance Tax Paid For Stock-Transferred: Kerala High Court

Case Title: Hillwood Furniture Pvt. Ltd Versus The Assistant Commissioner

The Kerala High Court has held that the petitioner will be entitled to credit for the entire amount paid in terms of Circular No. 50/2006 for the goods in question, which were stock-transferred to its branch office in Pollachi.

Himachal Pradesh High Court

Refusal To Entertain Refund Application Of Unutilized ITC; Himachal Pradesh High Court Imposes 10K Cost On Deputy CGST Commissioner

Citation: 2024 LiveLaw (HP) 31

Case Title: M/s AMN Life Pvt. Ltd. Versus Union of India & others

The Himachal Pradesh High Court has imposed a cost of Rs. 10,000 on the Deputy CGST Commissioner for refusing to entertain the application of the assessee or petitioner for a refund of unutilized input tax credit.

Himachal Pradesh High Court Quashes Order Rejecting Ultra Tech's Claim For Grant Of Budgetary Support Scheme

Citation: 2024 LiveLaw (HP) 32

Case Title: Ultra Tech Cement Ltd. Versus UOI

The Himachal Pradesh High Court has quashed the order rejecting Ultra Tech's claim for the grant of budgetary support.

Delay In Filing Return Bonafide: Himachal Pradesh High Court Allows Deduction To H.P. Housing & Urban Development Authority

Case Title: PCIT Versus M/s H.P. Housing & Urban Development Authority

Citation: 2024 LiveLaw (HP) 1

The Himachal Pradesh High Court has allowed the deduction under Section 80IB(10) of the Income Tax Act to the H.P. Housing & Urban Development Authority as the delay in filing the return was bona fide.

Himachal Pradesh High Court Declares Water Cess Levied By State Government On Hydropower Generation As Unconstitutional

Case Title: N.H.P.C. Ltd. Versus State of H.P. & ors.

Citation: 2024 LiveLaw (HP) 5

The Himachal Pradesh High Court has declared the levy of water cess by the state government on hydropower generation unconstitutional.

Allahabad High Court

Burden To Prove Escaped Assessment Lies On Assessing Authority: Allahabad High Court Quashes Reassessment Order Against Flipkart

Case citation: 2024 LiveLaw (AB) 116

Case Title: M/S Flipkart India Pvt. Ltd. Versus State Of U P And 4 Others

The Allahabad High Court has quashed the reassessment order against Flipkart and held that the burden to prove escaped assessment lies on assessing authority.

Where Statutory Appeals Filed After Making Pre-Deposit, Stay Applications Must Be Decided In Reasonable Time: Allahabad High Court

Case Title: Gurdeep Singh vs. Nagar Ayukt Nagar Nigam Moti Jheel And Another

Case Citation: 2024 LiveLaw (AB) 129

The Allahabad High Court has held that were a statutory appeal has been filed and the condition for pre-deposit has been complied with, stay applications filed along with such appeals must be decided within a reasonable time.

S.144B Income Tax | Burden to Provide Registered Email Shifts On Assessee Only If It Can't Be Obtained From ITR/Portal/MCA Website: Allahabad HC

Case Title: Grs Hotel Pvt. Ltd. Lko. Thru. Director Shri Ganga Charan Rajput vs. Union Of India Thru. Its Secy. (Revenue) Ministry Of Finance Govt. Of India

Case Citation: 2024 LiveLaw (AB) 188

The Allahabad High Court has held that the provision requiring the assesee to provide his “registered email address” to the income tax authorities under Section 144B of the Income Tax Act, 1961 is residuary in nature.

S.132B(1)(i) Income Tax Act | Power Of Assessing Authority To Decide Application For Release Of Seized Assets Not Automatically Abated After 120 Days: Allahabad HC

Case Title: Dipak Kumar Agarwal vs. Assessing Officer And 4 Others 2024 Case Citation: 2024 LiveLaw (AB) 248

The Allahabad High Court has held that the jurisdiction of the Assessing Authority to decide the application for release of seized assets under Section 132B (1)(i) does not abate after a period of 120 days from the date on which the last of the authorizations for search under section 132 or for requisition under section 132-A was executed.

[Income Tax Act] Supreme Court Decision In UOI v. Ashish Agarwal Applicable To Parties Who Challenged Notice U/S 148: Allahabad High Court

Case Title: M/S Arvind Kumar Shivhare vs. Union Of India And Another Case Citation: 2024 LiveLaw (AB) 249

The Allahabad High Court has held that Supreme Court in Union of India v. Ashish Agarwal had not issued a general mandamus quashing all notices issued under Section 148 of the Income Tax Act, 1961. The Court observed that the order of Supreme Court was limited to those notices which had been challenged before the Apex Court and various High Courts in India.

[House Tax] Authorities Acted In Undue Haste By Giving Only One Day's Notice For Hearing: Allahabad High Court Quashes Assessment Order

Case Title: Hotel President Through Its Partner / Proprietor And Another v. State Of Up And 2 Others

Case citation: 2024 LiveLaw (AB) 251

While quashing the enhanced assessment order regarding house tax passed by the authorities, the Allahabad High Court held that the authorities acted in undue haste by giving one day's notice for the hearing, which is not sufficient notice.

Statement Of Contractor Without Supporting Material Not Enough To Declare Transaction Benami: Allahabad HC Quashes Benami Transaction Proceedings

Case Title: Meera Pandey Thru. Her Attorney vs. Union Of India

Citation: 2024 LiveLaw (AB) 271

The Allahabad High Court has held that mere statement of the contractor doing construction work cannot be relied upon to declare such construction as benami transaction under the Prohibition of Benami Property Transactions Act, 1988. The Court held that “reasons to believe” in Section 24(1) of the Act must be based on cogent and relevant material.

S.144B(6) Income Tax Act | If Assessee “Requests” Then Opportunity Of Personal Hearing Is Mandatory, Not Optional: Allahabad High Court

Case 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).

“Reason To Believe” U/S 148A(C) Income Tax Act Amended To “Info Which Suggests”; Thorough Consideration Of Assessee's Reply Not Necessary: Allahabad High Court

Case Title: Rahul Sachan v. Income Tax Officer

The Allahabad High Court has held that a pointwise consideration of objections that may be raised by an assessee in response to a notice issued to him under Section 148 A(b) is not necessary while passing an order under Section 148A(d) of the Income Tax Act, 1961.

Punjab & Haryana High Court

Auction By Based On Non-Existent Order; Punjab & Haryana High Court Imposes Cost On Income Tax Authorities

Case Title: M/s Gokal Chand Rattan Chand Versus UOI

2024 LiveLaw (PH) 202

The Punjab and Haryana High Court has held that the auction proceedings based on a quashed ex-parte income tax appellate tribunal (ITAT) order by the tax recovery officer are void ab initio.

Assessment Order Passed Without Conducting Search And Seizure Not Sustainable In Law: Punjab & Haryana High Court

Case Title: Misty Meadows Private Limited Versus Union of India and others

The Punjab and Haryana High Court has held that once the search and seizure were conducted and an assessment order was passed by invoking Section 153A of the Income Tax Act for the AY 2006-07 to 2012-13, a fresh order without conducting a search and seizure operation would not be sustainable in law.

Assessees Not Expected To Keep Open Dept's E-Portal Of All The Time To Track Actions Of Dept.: Punjab & Haryana High Court

Case Title: Munjal BCU Centre Of Innovation And Entrepreneurship, Ludhiana Versus Commissioner Of Income Tax Exemptions, Chandigarh

2024 LiveLaw (PH) 106

The Punjab and Haryana High Court has held that the assessee is not expected to keep the e-portal of the department open all the time so as to have knowledge of what the department is supposed to be doing.

No Addition Is Permitted On Account Of Estimated Profit U/s 41(1) Simply Based On Assumptions: Punjab & Haryana High Court

Case Title: M/s Shree Digvijaya Woollen Mills Ltd Versus Commissioner of Income-Tax

The Punjab & Haryana High Court deleted the addition made by the AO u/s 41(1) of the Income tax Act on account of sale of copper wire, finding that the AO had made additions under the said provision simply on basis of presumption regarding the said sale, even after finding no stock in the premises.

Once ITO Accepts Rate At Which Closing Stock Was Valued, No Addition To Net Profit Can Be Made Without Recomputing Trading Result U/s 145(1): Punjab & Haryana HC

Case Title: M/s Shree Digvijaya Woollen Mills Ltd Verses Commissioner of Income-Tax

2024 LiveLaw (PH) 133

Finding that the stock production and consumption records were maintained under the supervision of the Excise Authorities and there is no objection raised with regard to the said stock by the ITO, the Punjab & Haryana High Court held that the Assessing Officer could not have proceeded on a presumption alleging higher wastage shown by the assessee.

Jharkhand High Court

Jharkhand High Court Upholds Income Tax Addition On Failure To Prove Genuineness Of Creditors Who Gave Cash Loan

Case Title: Rajmeet Singh Versus Income Tax Officer, Ward-2(3), Ranchi

LL Citation: 2024 LiveLaw (Jha) 24

The Jharkhand High Court has upheld the income tax addition as the assessees have failed to prove the identity, creditworthiness, or genuineness of the creditors, who have given cash loans.

Three-Years Limitation Period For Tax Reassessment Assessment Notice on Concealed Income Below Rs. 50 Lakh: Jharkhand High Court

Case Title: M/s Sevensea Vincom Private Limited vs The PCIT, Central Circle-I, Ranchi & Ors.

LL Citation: 2024 LiveLaw (Jha) 29

The Jharkhand High Court has held that any notice under Section 148 of the Income Tax Act, 1961, is normally three years from the end of the relevant assessment year and extendable beyond three years to 10 years, provided the income that has escaped assessment is Rs. 50,00,000 or more.

Decision On A Question Of Law That Is Later Overturned Or Modified By The Superior Court In Another Case Does Not Form A Ground For Review: Jharkhand High Court

Case Title: Adarsh Sahkari Grih Nirman Swawlambi Samiti Limited Vs Commissioner of Income Tax, Jamshedpur

LL Citation: 2024 LiveLaw (Jha) 55

The Jharkhand High Court has recently clarified the criteria for reviewing judgments in tax appeal cases, particularly regarding decisions based on legal questions.

Unjust Retention Of Money Or Property Of Another Is Against Fundamental Principles And Patently Illegal: Jharkhand HC Imposes Rs 5 Lakh Penalty On JBVNL, Directs Board To Refund TDS

Case Title: Anvil Cables Pvt. Ltd. v. State of Jharkhand and Ors.

LL Citation: 2024 LiveLaw (Jha) 64

The Jharkhand High Court has held that any unjust withholding of money or property from another party goes against the fundamental principles of justice, fairness, and good conscience. In this context, the unauthorized deductions made from the ongoing bills are unquestionably unlawful.

Jammu & Kashmir And Ladakh High Court

Leasehold Interest In Land Is Asset Of Company, Capable Of Valuation: Jammu & Kashmir And Ladakh High Court

Case Title: Principal Commissioner of Income Tax Versus Dr. Karan Singh

Citation: 2024 LiveLaw (JKL) 32

The Jammu & Kashmir and Ladakh High Court has held that leasehold interest in the land is an asset of the company and is capable of valuation. As such, it is to be included in the value of the assets of M/s. Jyoti Private Limited so as to determine the fair market value of shares held by the assessee as well as other shareholders.

Leasehold Interest In Land Is An Asset Of Company And Is Capable Of Valuation: Jammu & Kashmir High Court

Case Title: Principal Commissioner of Income Tax Versus Dr. Karan Singh

Citation: 2024 LiveLaw (JKL) 73

The Jammu & Kashmir High Court has held that leasehold interest in the land is an asset of the company and is capable of valuation.

Orissa High Court

Information Related To Outcome Of Tax Evasion Petition Sought Under RTI Act Can't Be Provided: Orissa High Court

Case Title: Deepak Kumar Acharya Versus Commissioner, Income Tax Dept and others

The Orissa High Court has held that information related to the outcome of a tax evasion petition sought under the Right to Information Act cannot be provided.

[Income Tax] Once Books Of Accounts Not Objected To Before Tribunal, AO Can't Disturb Gross Profit Rates Applied By Assesee: Allahabad High Court

Case Title: The Pr Commissioner Of Income Tax, Aaykar Bhawan And Another vs. The Mahabir Jute Mills Lts. Sahjanwah Gorakhpur

Citation: 2024 LiveLaw (AB) 327

The Allahabad High Court has held that once the acceptance of books of accounts by the Commissioner of Income Tax (Appeals) have not been objected to by the Assessing Authority before the Income Tax Appellate Tribunal, it is not open to the Assessing Officer to disturb the gross profit rate as declared by the assessee.

[Income Tax Act] Proceedings U/S 148A Summary In Nature, Assessing Authority To Only See If It Is “Fit Case” For Reassessment: Allahabad HC

Case Title: Ravindra Pratap Shahi v. Union Of India And 2 Others

The Allahabad High Court has held that proceedings under Section 148A of the Income tax Act, 1961 are summary in nature. The Court held that at the stage of passing order under Section 148A(d), the Assessing Authority has to only see if it is a “fit case” for initiation of reassessment proceedings or not.

Gauhati High Court

Long-Term Capital Gains Exempted From Income Tax, Non-Disclosure Doesn't Amount To Loss Of Revenue: Gauhati High Court

Case Title: Karan Jain Versus The Union Of India

Case Citation: 2024 LiveLaw (Gau) 30

The Gauhati High Court has held that the long-term capital gains are exempt from income tax, and the non-disclosure while computing the long-term capital gains cannot result in causing prejudice to the department.

Telangana High Court

Colourable Devices To Evade Tax Can't Be Tax Planning, Rules Telangana High Court

Case Title: Ayodhya Rami Reddy Alla Versus Principal Commissioner of Incometax Central

The Telangana High Court has held that tax planning may be legitimate, provided it is within the framework of the law. Colorable devices cannot be part of tax planning, and it is wrong to encourage or entertain the belief that it is honorable to avoid the payment of tax by resorting to dubious methods. It is the obligation of every citizen to pay the taxes honestly without resorting to subterfuges.

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