Supreme Court

Income Tax Dept. Can't Initiate Reassessment Proceedings During The Pendency Of The Rectification Proceedings: Supreme Court

Case Title: S.M. Overseas (P) Ltd. Versus CIT

The Supreme Court has held that the income tax department cannot initiate the reassessment proceedings during the pendency of the rectification proceedings.

The division bench of Justice M.R. Shah and Justice C.T. Ravikumar has observed that the Punjab and Haryana High Court has committed a serious error in holding that the notice under Section 154 was invalid as it was beyond the period of limitation. The proceedings under Section 154 of the Income Tax Act were not the subject matter before the High Court.

Delhi High Court

Delhi High Court Allows Deduction Of Expenses Undertaken Under the CSR Endeavour u/s 37 Of The Income Tax Act

Case Title: PCIT Versus PEC Ltd.

Citation: 2022 LiveLaw (Del) 1186

The Delhi High Court has allowed the deduction of expenses undertaken under the Corporate Social Responsibility (CSR) endeavor under Section 37 of the Income Tax Act, 1961.

The division bench of Justice Rajeev Shakdher and Justice Tara Vitasta Ganju has observed that the memorandum, which was published along with Finance (No. 2) Bill 2014, clearly indicated that the amendment would take effect from 01.04.2015 and, accordingly, would apply in relation to assessment year 2015-2016 and the subsequent years.

Delhi High Court Refuses To Release Laptop, Computer, Documents, Seized By DGGI During Search

Case Title: Dhruv Krishan Maggu Versus Principal Directorate General

Citation: 2022 LiveLaw (Del) 1187

The Delhi High Court has refused to release laptops, computers, documents, and other things that were seized by the Directorate General of GST Intelligence (DGGI) during the search.

The single bench of Justice Prathiba M. Singh has observed that the "documents, books, or things" can be retained for a maximum period of four and a half years, within which period the notice has to be issued, plus thirty days from the date of the erroneous refund.

Bombay High Court

Failure To Disclose All Material Facts Is Essential To Issue Reassessment Notice: Bombay High Court

Case Title: Chowgule & Company (P) Ltd. Versus JCIT

The Bombay High Court at Goa has held that failure to disclose fully and truly all material facts is an essential jurisdictional parameter that must be fulfilled before any notice can be issued for reopening the assessment proceedings after the expiration of four years from the end of the relevant assessment year.

The division bench of Justice M.S. Sonak and Justice Bharat P. Deshpande has observed that in the absence of any allegation or a plain statement about compliance with the jurisdictional parameter, the reassessment notice cannot be ordinarily sustained.

Madras High Court

Madras High Court Quashes Non-Speaking Order Cancelling GST Registration

The Madras High Court has quashed the order canceling GST registration without referring to the reason for the non-filing GSTR-3B return.

The single bench of Justice M. Sundar has remitted the matter back to the appellate authority with a directive to examine the matter on the merits based on available records and based on the opportunity already given to the writ petitioner/assessee under sub-section (8) of Section 107 of the CGST Act.

Chhattisgarh High Court

Lease Charges Paid By The Railways Department Not Subjected To Levy Of VAT: Chhattisgarh High Court

Case Title: M/s Ultratech Cement Limited Versus State of Chhattisgarh

Citation: Writ Petition (T) No. 128 Of 2015

The Chhattisgarh High Court has held that the lease charges paid by the Railways Department are not subject to the levy of value-added tax (VAT).

The single bench of Justice P. Sam Koshy has observed that the right to use goods or the use of goods is not the relevant factor to justify the levy of taxes.

Gujarat High Court

Gujarat High Court Releases Bank Account From Attachment Of Subsidiary Of Taiwan Company Subject To The Personal Undertaking Of The Directors

Case Title: FCS Manufacturing (India) Pvt. Ltd Vs Deputy Director Of Income Tax

The Gujarat High Court has directed the department to release the bank account from the attachment of the subsidiary of the Taiwan Company subject to the personal undertakings of the directors.

The division bench of Justice Sonia Gokani and Justice Mauna M. Bhatt, in order to secure the revenue's interest, has directed the department to continue the attachment of FD with DBS amounting to Rs. 2.65 crores.

No Fraudulent Intention Established: Gujarat High Court Quashes Penalty

Case Title: Shree Govind Alloys Pvt. Ltd.

The Gujarat High Court has held that the department could not establish any element of tax evasion with fraudulent intent or negligence.

The division bench of Justice Sonia Gokani and Justice Mauna M. Bhatt has observed that the delay was of almost 4 1⁄2 hours before the e-Way bill could expire. It appeared to be bonafide and without establishing any fraudulent intention.

Zero Supply Led Assessee To Believe There Was No Requirement To File GST Returns: Gujarat High Court Quashes Order Cancelling GST Registration

Case Title: Atlafbhai Rajabali Dosani Vs Superintendent

The Gujarat High Court has quashed the order of cancellation of registration and directed the department to restore the registration of the petitioner.

The division bench of Justice Sonia Gokani and Justice Mauna M. Bhatt has observed that the zero supply led the petitioner to believe that he was not required to file the returns. The assessee's consultant had not advised him correctly, which led to the non-filing of the return, which has now been filed.

Notification Issued Under Section 25 Of Customs Act, Effective From The Date It Is Digitally Signed: Gujarat High Court

Case Title: Adani Wilmar Limited versus Union of India

The Gujarat High Court has ruled that the notification issued under Section 25 of the Customs Act, 1962, enhancing the rate of customs duty, would be applicable only on the bills of entry presented after the said notification was e-published in the electronic Gazette and digitally signed.

Allahabad High Court

Allahabad High Court Punishes DC of Income Tax, For Contempt, Imposes Fine With Imprisonment For A Week

Case Title: Prashant Chandra Versus Harish Gidwani Deputy Commissioner Of Income Tax Range 2

The Allahabad High Court ruled that the outstanding amount showing on the web portal against the applicant/assessee was to be deleted immediately following the judgment, but the authorities allowed the outstanding amount to remain on the web portal for seven months, clearly violating the judgment.

The single bench of Justice Irshad Ali has imposed a fine of Rs. 25,000 along with simple imprisonment for a period of one week on the contemnor who was the Deputy Commissioner of Income Tax. In case of default, the contemnor would suffer one day's further simple imprisonment.

AAR

18% GST Is Payable On Work Contract Service Of Constructing Warehouse And Cold Storage Godown: AAR

Applicant's Name: Shree Constructions

The Telangana Authority of Advance Ruling (AAR) has ruled that 18% GST is payable on work contract services for constructing warehouses and cold storage godowns for Telangana State Industrial Infrastructure Corporation Limited (TSIICL), which will rent out the facilities.

ITAT

ITAT Allows Section 80G Deduction To The Trust Which Is Not Substantially Religious

Case Title: Santshreshtha Gajajan Maharaj Sevabhavi Sanstha Versus The Commissioner of Income-tax

The Pune Bench of the Income Tax Appellate Tribunal (ITAT) has allowed the deduction under Section 80G of the Income Tax Act to the trust, which is not substantially religious.

The two-member bench headed by R.S. Syal (Vice President) and Partha Sarthi Chaudhury (Judicial Member) has observed that if a trust or institution incurs expenses for religious purposes, which are inclusive and only a small part of the income, and if the substantial work done by the trust is charitable in nature and benefits the public at large, then the institution or trust has to be granted exemption under Section 80G.

Interest Income Earned By Co-Operative Society From Investments Made With Co-Operative Banks Is Eligible For Section 80P Deduction: ITAT

Case Title: ITO Versus Mittal Court Premises Co. Op. Society Ltd

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) has allowed the deduction under section 80P(2)(d) of the Income Tax Act in respect of interest earned by cooperative societies from investments made with cooperative banks.

The two-member bench of Aby T. Varkey (Judicial Member) and Amarjit Singh (Accountant Member) has relied on the decision of the Karnataka high court in the case of PCIT VS Totagar's Cooperative Sales Society, in which it was held that the interest income derived by co-operative society by way of investment made with a co-operative bank would be entitled to a claim of deduction under Section 80P(2)(d).

ITAT Deletes Addition On Account Of Cash Deposited In The Bank Accounts During Demonetisation Period

Case Title: Rahul Cold Storage Versus The Income Tax Officer

The Raipur Bench of the Income Tax Appellate Tribunal (ITAT) has deleted the addition on account of cash deposited in bank accounts during the demonetization period.

The bench of Ravish Sood (a judicial member) has observed that the AO, by not rejecting the books of account, has clearly accepted that the cash deposited in the bank accounts by the assessee firm during the year under consideration was not from its disclosed sources.

Matter Which Is Not The Subject Matter Of Limited Scrutiny Cannot Be Raised In Revisionary Proceedings: ITAT

Case Title: M/s Longia Engineers Versus Pr. CIT

The Chandigarh Bench of the Income Tax Appellate Tribunal (ITAT) has held that matters that were not subject to limited scrutiny cannot be raised in revisionary proceedings.

The two-member bench of Diva Singh (Judicial Member) and Vikram Singh Yadav (Accountant Member) has observed that the matter relating to wages and labor expenses, which was not subject to limited scrutiny, cannot be raised in revisionary proceedings under Section 263 of the Income Tax Act for the first time.

CESTAT

Limitation Period Not Applicable To Refund Claims For Service Tax Paid Under Mistake Of Law: CESTAT

Case Title: M/s. Raheja Regency Cooperative Housing Society ltd. Versus Commissioner of GST & Central Excise

The Mumbai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that the limitation prescribed under Section 11B of the Central Excise Act, 1944, is not applicable to refund claims for service tax paid under a mistake of law.

The bench of Ajay Sharma (Judicial Member) has observed that the appellant cannot be said to be liable to pay service tax in any way because what was paid by the appellant was not tax as defined by the Finance Act of 1994. As a result, the amount paid by the appellant does not have the character of a tax but is simply an amount paid due to a mistake of law.

Employees' Contribution To PF Cannot Be Disallowed Merely On The Basis Of Auditor's Statement: ITAT

Case Title: M/s P R Packaging Service Versus ACIT

The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) has deleted the addition made by the Centralised Processing Centre (CPC) towards employees' contributions to the Provident Fund (PF) based on the tax auditor's statement reporting the delay in employee contribution remittances.

The two-member bench of Aby T. Varkey (Judicial Member) and M. Balaganesh (Accountant Member) has observed that the action of the CPC Bangalore in disallowing the employees' contribution to the provident fund while processing the return under section 143(1) of the Income Tax Act was against the provisions of the Act as it would not fall within the ambit of prima facie adjustments.