Direct Tax Cases Monthly Round Up: July 2024
Mariya Paliwala
1 Aug 2024 3:09 PM IST
Supreme CourtState Not Liable To Collect Tax At Source While Giving Contractors Permit To Vend Liquor At Fixed Retail Price : Supreme CourtCase Details : THE EXCISE COMMISSIONER KARNATAKA & ANR. v. MYSORE SALES INTERNATIONAL LTD. & ORS CIVIL APPEAL NO. 2168 OF 2007Citation : 2024 LiveLaw (SC) 496The Supreme Court recently held that any vendor who buys liquor from state...
Supreme Court
Case Details : THE EXCISE COMMISSIONER KARNATAKA & ANR. v. MYSORE SALES INTERNATIONAL LTD. & ORS CIVIL APPEAL NO. 2168 OF 2007
Citation : 2024 LiveLaw (SC) 496
The Supreme Court recently held that any vendor who buys liquor from state manufacturers without obtaining it through auction and sells in retail at a fixed price would be excluded from the definition of 'buyer' under Section 206C of the Income Tax Act. Such a trade would be exempted from TCS (Tax Collected at Source).
Case Details : Mineral Area Development v. M/S Steel Authority Of India & Ors (CA N0. 4056/1999)
Citation : 2024 LiveLaw (SC) 512
The Supreme Court has recently held that regular entries under List I and II of the 7th Schedule of the Constitution cannot be given a wider interpretation to include taxation powers which are covered under the domain of specific tax entries under the 7th Schedule.
Case Title: Deputy Director of Income Tax & Anr. v. M/S. Vodafone Idea Ltd.
Citation :2024 LiveLaw (SC) 522
Dismissing a petition filed by the Income Tax Department, the Supreme Court recently upheld the view that Vodafone Idea is not liable to deduct TDS (tax deducted at source) on interconnectivity usage and bandwidth charges paid to non-resident telecom operators.
Delhi High Court
Not Permissible For TPO To Engage In Restructuring Of Transaction: Delhi High Court
Case Title: CIT Versus A.T. Kearney Ltd.
The Delhi High Court has held that it is not permissible for the Transfer Pricing Officer (TPO) to engage in the restructuring of a transaction.
Case Title: The Commissioner Of Income Tax - International Taxation Versus Telstra Singapore Pte Ltd.
The Delhi High Court has held that the receipts from Indian customers for services provided outside' Indian Territory in connection with use or right to use of process or equipment by the assessee company cannot be taxed as royalty.
Case Title: CIT(E) Versus NIIT Foundation
The Delhi High Court has held that the assessee is carrying on educational activities that are covered by the provisions of Section 2 (15) of the Income Tax Act, and it is neither business nor profession of the assessee.
Case Title: New Okhla Industrial Development Authority Versus Union Of India & Ors.
The Delhi High Court has held that the loans and advances extended by the New Okhla Industrial Development Authority (NOIDA) are not commercial activities and are eligible for exemption under Section 10(46) of the Income Tax Act.
TPO Lacks Jurisdiction To Question Commercial Expediency Or Genuineness Of Need: Delhi High Court
Case Title: PCIT Versus Samsung India Electronics Pvt. Ltd.
The Delhi High Court has held that the statutory authority conferred upon the Transfer Pricing Officer (TPO) can only extend to an examination of the appropriateness of the method adopted for the purposes of determining arm's length pricing (ALP) or evaluating the enlistment of comparables. However, the TPO would neither be justified nor could it be countenanced to have the jurisdiction to question commercial expediency or genuineness of need.
Case Title: International Management Group (Uk) Limited Versus Commissioner Of Income Tax-2, International Taxation, New Delhi
The Delhi High Court has held that services provided by International Management Group (IMG) are utilized by the Board of Control for Cricket in India (BCCI) outside India, so the income determined as Fee for Technical Services (FTS) cannot be deemed to accrue in India and therefore cannot be taxed in India.
Order Of ITSC Final And Conclusive For AY For Which Application Has Been Filed: Delhi High Court
Case Title: Pr. Commissioner Of Income Tax -Central -1 Versus Maharaji Education Trust
The Delhi High Court has held that the order of the Income Tax Settlement Commission (ITSC) is final and conclusive for a particular assessment year (AY) for which the application has been filed.
ITSC Empowered To Make Income Tax Addition: Delhi High Court
Case Title: Harsh Dhanuka HUF Versus PCIT
The Delhi High Court has held that the Income Tax Settlement Commission (ITSC) does not lack jurisdiction to make an addition, which has also been duly recorded in the terms of settlement.
AO Can't Review Its Own Order: Delhi High Court
Case Title: Aarti Fabricott Private Limited Versus Income Tax Officer, Ward 1(1), Delhi & Anr.
The Delhi High Court has held that the Assessing Officer (AO) cannot review its own order.
Bombay High Court
Case Title: PCIT Versus G.K. Developers
The Bombay High Court has held that the expression 'built up area' introduced with effect from April 1, 2005, could not be applied retrospectively, and the Tribunal was justified in holding that up to April 1, 2005, the expression 'built up area' would exclude the balcony area.
Case Title: Royal Bitumen Private Limited, Mumbai Vs. Assistant Commissioner of Income-Tax
The Bombay High Court has held that the Jurisdictional Assessing Officer (JAO) would cease to have jurisdiction to issue any notice under Section 148A(b) and to take further actions under Section 148A(d) and Section 148 of the Act, outside the faceless assessment.
Investment Allowance Available On Exchange Rate Fluctuation: Bombay High Court
Case Title: M/s. Tolani Ltd. Versus DCIT
The Bombay High Court has held that investment allowance is available on exchange rate fluctuations.
Investment Allowance Available On Exchange Rate Fluctuation: Bombay High Court
Case Title: M/s. Tolani Ltd. Versus DCIT
The Bombay High Court has held that investment allowance is available on exchange rate fluctuations.
Section 148A(d) Order Passed Without Section 151 Sanction Is Illegal: Bombay High Court
Case Title: Umang Mahendra Shah Versus Union of India & Ors.
The Bombay High Court has held that if an order is passed under Section 148A(d) of the Income Tax Act in the absence of an appropriate sanction in terms of the provisions of Section 151 of the Income Tax Act, the order and the consequent notice under Section 148 would be required to be declared illegal.
JAO Not Empowered To Issue Section 148A(b) Notice Under Faceless Assessment: Bombay High Court
Case Title: Venus Jewel Versus ACIT
The Bombay High Court has held that it was not permissible for the Jurisdictional Assessing Officer (JAO) to issue a notice under Section 148A(b), as the same would amount to a breach of the provisions of Section 151A of the Income Tax Act.
Case Title: ACIT Versus Sociedade de Fomento Industrial Pvt. Ltd.
The Bombay High Court at Goa, while upholding the order of the Income Tax Appellate Tribunal (ITAT), has held that the assessee cannot be expected to deduct tax at source from payments that became taxable owing to a retrospective amendment.
Case Title: Smt. Sunita Purushottam Virgincar Versus ITO
The Bombay High Court at Goa has held that the reassessment notice issued without complying with the pre-conditions mentioned in Section 148 of the Income Tax Act was beyond jurisdiction.
Case Title: ACIT Versus Sociedade de Fomento Industrial Pvt. Ltd.
The Bombay High Court at Goa, while upholding the order of the Income Tax Appellate Tribunal (ITAT), has held that the assessee cannot be expected to deduct tax at source from payments that became taxable owing to a retrospective amendment.
Case Title: Smt. Sunita Purushottam Virgincar Versus ITO
The Bombay High Court at Goa has held that the reassessment notice issued without complying with the pre-conditions mentioned in Section 148 of the Income Tax Act was beyond jurisdiction.
Madras High Court
Foreign Tax Credit Can't Be Denied In Spite Of Accepting Computation: Madras High Court
Case Title: Thejo Engineering Limited Versus The Deputy Director of Income Tax
The Madras High Court has held that the claim of foreign tax credit cannot be denied in spite of accepting the computation.
Karnataka High Court
Case Title: The Income Tax Department Versus M/S. Jenious Clothing Private Ltd
Citation: 2024 LiveLaw (Kar) 340
The Karnataka High Court has dismissed the appeals preferred by the Income Tax Department under Section 377 of Cr.P.C.
Reassessment Notice To Non-Existing Entity Is Not Legally Tenable: Karnataka High Court
Case Title: Informatica Business Solutions Private Limited Versus Acit
The Karnataka High Court has held that the reassessment notice to a non-existing entity is not legally tenable.
Case Title: Suresh Chatrabhoj Bhanushali Versus UOI
The Karnataka High Court has granted an interim stay on a reassessment notice issued under Section 148 of the Income Tax Act, 1961 which was not issued in terms of the procedure prescribed under Faceless Assessment.
Calcutta High Court
Case Title: Vishal Jhajharia Versus The Assessment Unit, Income Tax Department Faceless Assessment Centre & Ors.
The Calcutta High Court has quashed the assessment order on the grounds that the department has failed to put the assessee on notice in respect of addition under Section 69A of the Income Tax.
Case Title: Vodafone Idea Limited Vs Comissioner Of Income Tax
The Calcutta High Court has held that the cellular mobile service providers are not obliged to deduct the tax at source (TDS) on income received by distributors/franchisees from customers.
Case Title: Vodafone Idea Limited Vs Comissioner Of Income Tax
The Calcutta High Court has held that the cellular mobile service providers are not obliged to deduct the tax at source (TDS) on income received by distributors/franchisees from customers.
Kerala High Court
2024 LiveLaw (Ker) 467
Case Title: PCIT Versus Arun Majeed
The Kerala High Court has held that when a property kept not for trade but for investment purposes is sold, the gain has to fall under the head 'capital gains' and such a transaction is only taxable under capital gain and not under adventure of trade.
Assessments Getting Time Barred By 31.03.2017 Can Continue Only Upto 31.03.2018: Kerala High Court
Case Title: Intersource Exports (P) Ltd. Versus Deputy Commissioner Of State Tax
Citation: 2024 LiveLaw (Ker) 483
The Kerala High Court has held that the assessments that were getting time barred by 31.03.2017 can continue only up to 31.03.2018.
2024 LiveLaw (Ker) 445
Case Title: PCIT Versus Kunhitharuvai Memorial Charitable Trust
The Kerala High Court has held that the tax effect in the appeals filed by the income tax department pertaining to assessment years 2006–07, 2007–08, 2008–09, 2009–10, and 2010–11 is well below the monetary limit of Rs. 1 crore and is liable to be dismissed.
Assessment Order Downloaded From Common Portal Amounts To A Valid Service: Kerala High Court
2024 LiveLaw (Ker) 444
Case Title: Sunil Kumar K Versus The State Tax Officer-I, Kottarakkara
The Kerala High Court has held that the assessment order downloaded from the common portal amounts to a valid service.
Case Title: Unitac Energy Solutions (India) Pvt.Ltd. Versus The Assistant Commissioner Of Income Tax
The Kerala High Court has held that the disallowance operates against erring employer assessee when employees' contribution to EPF/ESI not made within the due date.
Case Title: The South Indian Bank Ltd Versus ACIT
The Kerala High Court has held that the South Indian Bank is entitled to the deduction envisaged under Section 36(1)(viii) of the Income Tax Act in respect of the long-term finance provided by it for the construction and purchase of houses in India for residential purposes.
Decision By Income Tax Officer Who Did Not Hear The Case; Kerala High Court Quashes The Order
Case Title: Sri. Johnson Koomullil Thomas Versus The Income Tax Officer
The Kerala High Court has held that if the income tax officer who hears the case does not render the decision, it would amount to a violation of the principles of natural justice.
Case Title: Aaron Construction Co. Versus Union Of India
The Kerala High Court has held that the non-filing of returns even after receipt of the assessment order is fatal for the assessee.
Decision By Income Tax Officer Who Did Not Hear The Case; Kerala High Court Quashes The Order
Case Title: Sri. Johnson Koomullil Thomas Versus The Income Tax Officer
The Kerala High Court has held that if the income tax officer who hears the case does not render the decision, it would amount to a violation of the principles of natural justice.
Case Title: Aaron Construction Co. Versus Union Of India
The Kerala High Court has held that the non-filing of returns even after receipt of the assessment order is fatal for the assessee.
Citation: 2024 LiveLaw (Ker) 415
Case Title: The Meenachil Taluk Cooperative Employees Cooperative Society Limited Versus Commissioner Of Income Tax (Appeals)
The Kerala High Court, while condoning the delay of 11 days, observed that filing an appeal in tax matters may require legal and technical assistance.
Transfer Of Depreciable Capital Assets Attracts Capital Gains Tax: Kerala High Court
Citation: 2024 LiveLaw (Ker) 414
Case Title: PVR Tourist Home Versus CIT
The Kerala High Court has held that the transfer of the depreciable capital assets attracted capital gains tax under Section 45(4) of the Income Tax Act, in the absence of distribution of any capital asset among the partners following a dissolution of the appellant firm.
Manipur High Court
Case Title: Smt. Mema Paul Versus Income Tax Officer
The Manipur High Court has held that the reassessment made by the Income Tax Officer without communicating the order of reassessment and the demand notice of the reassessment within time cannot be treated as a valid assessment.
Case Title: Jatinder Singh Bhangu verses Union of India and others
Citation: 2024 LiveLaw (PH) 165
While pointing that scheme of faceless assessment is applicable from the stage of show cause notice u/s 148 as well as 148A, the Punjab & Haryana High Court ruled that notice u/s 148 cannot be issued by Jurisdictional Assessing Officer after introduction of faceless assessment scheme.
Jharkhand High Court
Case Title: PCIT Versus Tripta Sharma
LL Citation: 2024 LiveLaw (Jha) 124
The Jharkhand High Court, while dismissing the appeal filed by the department, held that a delayed condonation application not filed with an appeal memo and subsequent filing cannot cure defects.
Rajasthan High Court
Case Title: Padam Raj Bhandari Versus UOI
Citation: 2024 LiveLaw (Raj) 182
The Rajasthan High Court has allowed the application seeking condonation of delay under Section 119(2)(b) of the Income Tax Act in order to claim a refund for the assessment year 2009-10 to 2014-15 on the grounds of genuine hardship.
Gujarat High Court
Admission Fee Charged From Students Forms Part Of Corpus Donation: Gujarat High Court
Case Title: N H Kapadia Education Trust Versus The Assistant Commissioner Of Income Tax (Exemptions)
The Gujarat High Court has held that the admission fee charged by the students forms part of the corpus donation of the trust.
Admission Fee Charged From Students Forms Part Of Corpus Donation: Gujarat High Court
Case Title: N H Kapadia Education Trust Versus The Assistant Commissioner Of Income Tax (Exemptions)
The Gujarat High Court has held that the admission fee charged by the students forms part of the corpus donation of the trust.
Citation: 2024 LiveLaw (Guj) 84
Case Title: Ashwinbhai Babubhai Dudhat Versus The Interim Board For Settlement
The Gujarat High Court has allowed the deduction under Section 54 of the Income Tax Act on the cash transaction of the sale and purchase of residential property.
Telangana High Court
Case Title: M/s.Pipelic Energy Software India Pvt.Ltd. Versus The Deputy Commissioner of Income Tax
The Telangana High Court has held that deductions cannot be availed on expenditures incurred for overseeing the project of holding a company.
Case Title: M/s.Pipelic Energy Software India Pvt.Ltd. Versus The Deputy Commissioner of Income Tax
The Telangana High Court has held that deductions cannot be availed on expenditures incurred for overseeing the project of holding a company.
Meghalaya High Court
Case Title: Pr. Commissioner of Income Tax, Shillong Versus M/s North Eastern Electric Power Corporation Limited
The Meghalaya High Court has held that once the revision order becomes final, no question of passing another order will arise.
Case Title: Pr. Commissioner of Income Tax, Shillong Versus M/s North Eastern Electric Power Corporation Limited
The Meghalaya High Court has held that once the revision order becomes final, no question of passing another order will arise.
Himachal Pradesh High Court
Case Title: J.B.J. Perfumes Private Limited Versus Principal Commissioner of Income Tax and another
Citation: 2024 Livelaw (HP) 32
The Himachal High Court quashed the reassessment order on the grounds that the assessment was re-opened by the department based on 'change of opinion'.
