Direct Tax Cases Monthly Round Up: May 2024
Mariya Paliwala
1 Jun 2024 4:00 PM IST
Supreme CourtInterest-Free/Concessional Loans To Bank Employees Taxable As Perquisite : Supreme Court Upholds Rule 3(7)(I) Of Income Tax RulesCase Name- All India Bank Officers' Confederation Vs The Regional Manager, Central Bank Of India & OthersCitation : 2024 LiveLaw (SC) 352A Division bench of the Supreme Court comprising of Justice Sanjiv Khanna and Justice Dipankar Datta while...
Supreme Court
Case Name- All India Bank Officers' Confederation Vs The Regional Manager, Central Bank Of India & Others
Citation : 2024 LiveLaw (SC) 352
A Division bench of the Supreme Court comprising of Justice Sanjiv Khanna and Justice Dipankar Datta while deciding a Civil Appeal in the case of All India Bank Officers' Confederation Vs The Regional Manager, Central Bank Of India & Others has held that Rule 3(7)(i) of the Income Tax Rules, 1962 is not violative of Article 14 of the Constitution of India and provision of interest free/concessional loan benefits provided by banks to bank employees shall be taxable as a perquisite under Section 17 of the Income Tax Act, 1961.
Delhi High Court
Case Title: CIT verses Dabur India Ltd
The Delhi High Court dismisses Revenue's appeal against ITAT's order in case of Dabur India Ltd., while reiterating that for purpose of deduction u/s 80IB & 80IC of the Income tax Act, the only essential requisite is that the eligible industrial undertakings should be carrying out manufacture or production of articles or things.
Case Title: Global Vectra Helicorp Limited Versus Assessment Unit, National Faceless Assessment Centre, Delhi
The Delhi High Court has held that the income tax department should allow personal hearings through the national faceless assessment centre on the assessee's request.
No Proceedings Under PMLA Could Be Sustained After Acquittal Of Accused: Delhi High Court
Case Title: Directorate Of Enforcement Versus Akhilesh Singh
The Delhi High Court has held that no proceedings under the Prevention of Money Laundering Act, 2002 (PMLA) could be sustained after the acquittal of the accused in the predicate offence.
AO Can't Proceed With Assessment In Absence Of Section 127 Transfer Order: Delhi High Court
Case Title: Rajsheela Growth Fund (P) Ltd. Versus ITO
The 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.
Case Title: PT Bukaka Teknik Utama Versus Commissioner Of Income Tax (IT), Delhi - 2
The Delhi High Court has held that the assessee can't be obstructed from availing of the benefits of the Direct Tax Vivad se Vishwas Act, 2020 (DTVSV Act) even where the time limit for an appeal has not expired.
Case Title: Dollar Gulati Vs PCIT and Ors
The Delhi High Court refuses to interfere with the order of the AO passed u/s 127 where the case of the Taxpayer was centralized and transferred from Income-tax Officer (ITO), Delhi to Deputy Commissioner of Income-tax (DCIT), Central Circle, Haryana.
Case Title: Pr. Commissioner Of Income Tax -15 Versus Shiv Kumar Nayyar
The Delhi High Court has held that a grant of approval under Section 153D of the Income Tax Act, 1961, cannot be merely a ritualistic formality or rubber stamping by the authority; rather, it must reflect an appropriate application of mind.
Case Title: New Delhi Television Limited Versus Dispute Resolution Panel 2 & Anr
The Delhi High Court has held that once the Transfer Pricing Officer (TPO) had proceeded to pass the order of October 17, 2017, all that the AO was obliged to do was pass an assessment order in accordance with the procedure prescribed in Section 92CA(4) of the Income Tax Act.
Bombay High Court
Case Title: Balkrishna Barsha Sutar Versus The Income Tax Officer
The Bombay High Court has held that the sanctioning authority has to be the Principal Chief Commissioner of Income Tax (PCCIT) for issuing a reopening notice after the expiry of three years.
Case Title: Bhatewara Associates Versus Income Tax Appellate Tribunal, Pune & Ors.
The Bombay High Court, while setting aside the order of the Income Tax Appellate Tribunal (ITAT), held that the authority should refrain from overanalyzing, which leads to paralysis of justice.
Capital Gain Tax Not Payable On Transfer Of Shares By Way Of Gift: Bombay High Court
Case Title: M/s. Jai Trust Versus The Union of India
The Bombay High Court has held that capital gain tax is not payable on the transfer of shares by way of gift.
Merely Brandishing Newspaper Cuttings Doesn't Prove Sharing Commercial Expertise: Bombay High Court
Case Title: Hindustan Export & Import Corporation Private Limited Versus The Deputy Commissioner of Income-tax
The 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.
No Change In Opening And Closing Stock Of NCDs; Bombay High Court Quashes Reassessment Notice
Case Title: Upesi Ventures Ltd. Versus The Assistant Commissioner of Income Tax
The 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).
Case Title: Echjay Industries Pvt Ltd Vs Union of India
The Bombay High Court recently quashed the search proceedings authorized by CBDT u/s 132(1) along with consequential notices and further actions on the ground that the material considered for authorizing the search is irrelevant and unrelated, and that “the reasons recorded, only indicates a mere pretence”.
Case Title: CG Power And Industrial Solutions Ltd Vs Assistant Commissioner of Income Tax
The Bombay High Court quashes the CBDT's order rejecting the application filed by CG Power and Industrial Solutions Ltd seeking condonation of delay in filing returns of income based on recast of accounts pursuant to NCLT's order.
'Transit Rent' Can't Be Considered As 'Revenue Receipt', Not Liable To Be Taxed: Bombay High Court
Case Title: Sarfaraz S. Furniturewalla Versus Afshan Sharfali Ashok Kumar & Ors.
The Bombay High Court has held that 'Transit Rent' is not to be considered a revenue receipt and is not liable to be taxed. As a result, there will be no question of the deduction of TDS from the amount payable by the developer to the tenant.
Jharkhand High Court
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.
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).
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.
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.
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.
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.
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.
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.
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.
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.
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.
Kerala High Court
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.
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.
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.
Gauhati High Court
Case Title: Karan Jain Versus The Union Of India
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.
