Month: September 2017

Period of Limitation u/s 201(3) for passing an order treating deductor as assesse in default and charging interest for delayed payment of TDS for Financial year 2007-08 was confined to 31-03-2011 and it was was later albeit increased to seven years from the end of financial year in which TDS was deposited w.e.f. 01-10-2014.

Delhi High Court in case of Oracle India P Ltd. Held that since notice for financial year 2007-08, after 31-03-2011 was time barred even if later on law increased the period of limitation.

In this case, Investigation Wing had started  inquiry  against the assesse on the basis of unsigned photocopy of bayana.

Delhi High Court in SFIL Stock Broking Ltd 325 ITR 285 relied upon which promulgated  that notice u/s 148 can not be issued on the basis of borrowed satisfaction .

Madhu Kaul ITA 89/1999 dated 17-01-2014 (P&H)

Vinod Kumar Jain ITA 140/2000 dated 24-09-2010 (P&H)

Ved Parkash and sons (HUF), (1994) 207 ITR 148 (P&H)

Continue reading “Date of allotment of flat/property and not date of identification of flat or possession of flat or date of registration of flat is relevant to determine the period of 36 months for computation of long term capital gain”

Supreme Court in S S Gadgil 53 ITR 231 has held that if limitation period is extended under the provisions of Income Tax law, the extended period of limitation shall not apply to assessments years, for which limitation period has expired before amending the law on limitation.

  Continue reading “If the right to act under the earlier statute has come to an end, it could not be revived by the subsequent amendment which extended the period of limitation”

Section 194LA is applicable for TDS on payments for Compulsory acquisition of immovable property exceeding Rs. 2,50,000 p.a.  @ 10% . However  u/s 194-IA TDS @ 1% is applicable on transfer of immovable property (other than compulsory acquisition) for consideration more than 50 lacs.

Continue reading “TDS on Compulsory Acquisition of Agricultural Land: Special Land Acquisition Officer [2016] 72 taxmann.com 255 (Gujarat) JULY 25, 2016”

Rumors about taxability of household jewellery negated by Government in press release dated 01-12-2016 saying that no new provision regarding chargeability of tax on jewellery have been introduced. Apprehension sought to be created that the jewellery with the household which is acquired out of disclosed sources or exempted income shall become taxable under the proposed amendment is totally unfounded and baseless.

Further press release has exhorted upon Instruction No.1916 dated 11-05-1994 of CBDT providing that during the search operations, no seizure of gold jewellery and ornaments to the extent of 500 grams per married lady, 250 grams per unmarried lady and 100 grams per male member of the family shall be made.

Author’s Comments:

It has been held by by Karnatka High Court in Smt Pati Devi 240 ITR 727 that weight of Jewellery as per Instruction dated 11-05-1995 is considered reasonable looking to the social circumstances prevailing in the country.

It has been held by Rajasthan High Court in Satya Narain Patni [2014] 46 taxmann.com

440 (Rajasthan) where  the authorized officers, in the first instance, did not seize the said jewellery as the same being within the tolerable limit or the limits prescribed by the Board , subsequent addition is also not justifiable on the part of the Assessing Officer.

Held by ITAT Mumbai in Harakchand N.Jain [1998] 101 TAXMAN 324 (MUM.) “………..we are conscious of the fact that in Indian society everyone receives gifts at the time of marriage and other occasions. Therefore, keeping in view the number of family members we are of the view that further rebate of 500 gms out of the entire jewellery may be treated as explained………..”

ITAT  Hyderabad Tribunal in R. Umamaheswar [2015] 60 taxmann.com 400 (Hyderabad – Trib.), ITAT Jabalpur in Smt. Sulochna Devi Jaiswal [2003] 1 SOT 624 (JAB.), ITAT Kolkatta in Smt Jyoti Bose [2004] 3 SOT 525 (KOL.), Allahabad High Court in CIT v. Ghanshyam Das Johri [2014] 41 taxmann.com 295 (Allahabad), Gujrat High Court in Rattan Lal Vyapari Lal Jain 339 ITR 351, ITAT Mumbai in Narendra D Patel, Rajasthan High Court in Kailash Chand Sharma 198 CTR 201, Madhya Pradesh High Court in M.S. Aggrawal HUF 11 DTR 169 have upheld the same view.

Hence in spirit of above instruction read with above court judgments , addition up to limits of Rs. 500 grams per married , 250 gms.  per unmarried lady and 100 gms per male member may not be sustainable, even if not explained and should be treated as explained.[As per Author’s Opinion]

Supreme Court in decision dated 16-12-2016 has refused to interfere into vires of Pradhan Mantri Garib Kalyan Yojna , aiming for 50% tax and 25% deposit redeemable over four years.

Supreme Court said tha it can not encroach upon policy making arena and suggest a different policy on the foundation that policy framed by Union of India could have been better.

There is difference between constitutional validity of policy and conception of framing of a better policy.