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Transfer Pricing: The Comparable Uncontrolled Price (CUP) method is not the Most Appropriate Method for determining the Arm's Length Price (ALP) in respect of the transactions of (sales of goods and sales commission) with Associated Enterprises (AEs) if there are geographical differences, volume differences, timing differences, risk differences and functional differences. If it is not shown that the selection of TNMM as the Most Appropriate Method is perverse, the same cannot be challenged
Pr. CIT. vs. Amphenol Interconnect India P. Ltd.
(2018) TaxCorp(LJ) 14481 (HC-BOMBAY)
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Law on reopening u/s 147 pursuant to an audit objection opposed by the AO explained in the context of (i) the notice being silent on whether it was issued pursuant to the audit objection, (ii) there being a gap between the AO's opposition and the issue of notice and (iii) the reasons for reopening being supported by a subsequent Supreme Court judgement
CIT vs. Rajan N. Aswani
(2018) TaxCorp(LJ) 14457 (HC-BOMBAY) · Section 147
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S. 143(1)(a): Submission of Dept that decisions of Courts and Tribunals interpreting a provision is to be ignored by the AO will ring the death knell of Rule of law in the Country. It ignores the hierarchical system of jurisprudence in our country. The AO is bound by the views of the Court. Law on s. 36(1)(viii) (Bad debts) explained
Bajaj Auto Finance Ltd vs. CIT
(2018) TaxCorp(LJ) 14456 (HC-BOMBAY) · Section 143(1)(a)
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No more adjournments. No more ‘tareek pe tareek’. Enough is enough. That a Court will endlessly grant adjournments is not something that parties or advocates can take for granted. Nor should they assume that there will be no consequences to continued defaults and unexplained delay
Ram Nagar Trust No.1 vs. Mehtab L Sheikh
(2018) TaxCorp(LJ) 14433 (HC-BOMBAY)
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Service-tax on maintenance of property: Under the MOFA, the builder/ developer is under a statutory obligation to look after the day-to-day upkeep, maintenance and repair of the property till conveyance to the co-op society. Such maintenance of the structure is not rendering a taxable service as per s. 65 (64) of the Finance Act, 1994
CST. Vs. Shri Krishna Chaitanya Enterprises
(2018) TaxCorp(LJ) 14341 (HC-BOMBAY) · Section. 65 (64)
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GST Network: The regime is not tax friendly. GST was highly publicised and termed as popular but there has been great hue and cry because assessees are unable to obtain access to the GST website. Those in charge of implementation and administration must wake up and put in place the requisite mechanism to preserve the image, prestige and reputation of this country, particularly when we are inviting and welcoming foreign investment in the State and the country
Abicor and Binzel Technoweld Pvt. Ltd. vs. UOI
(2018) TaxCorp(LJ) 14330 (HC-BOMBAY)
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S. 40(a)(i) TDS disallowance: A party cannot be called upon to perform an impossible Act i.e. to comply with a provision not in force at the relevant time but introduced later by retrospective amendment. S. 40(a)(i) disallowance can be made only if the royalty falls under Explanation 2 to s. 9(1)(vi) but not if it falls under Explanation 6 to s. 9(1)(vi)
CIT. Vs. NGC Networks (India) Pvt. Ltd.
(2018) TaxCorp(LJ) 14329 (HC-BOMBAY) · Section. 40(a)(i)
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S. 271(1)(c) Penalty: The law in Nayan Builders 368 ITR 722 (Bom) does not mean as a matter of rule that in case where the High Court admits an appeal relating to quantum proceedings ipso facto i.e. without anything more, the penalty order gets vitiated. The question of entertaining an appeal from an order imposing / deleting penalty would have to be decided on a case to case basis. There can be no universal rule to the effect that no penalty can be levied if quantum appeal is admitted on a substantial question of law
Shree Gopal Housing & Plantation Corporation
(2018) TaxCorp(LJ) 14318 (HC-BOMBAY) · Section. 271(1)(c)
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HC - No sec. 40(a)(i) disallowance in respect of amended 'royalty' definition vide Finance Act, 2012 by virtue of retrospective insertion of Explanation 6 to Sec.9(1)(vi),
NGC Networks (India) Pvt. Ltd. Vs. CIT
(2018) TaxCorp(LJ) 14276 (HC-BOMBAY) · Section. 40(a)(i)
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HC - Writ allowed - Sec. 197 does not do away with requirement of issuing a reasoned order while issuing a Certificate u/s 197. Cancellation order was non- speaking and requirement of natural justice was not met and assessee was provided no opportunity to seek copy of reasons recorded while issuing the certificate.
Tata Teleservices (Maharashtra) Limited. Vs. The CIT
(2018) TaxCorp(LJ) 14249 (HC-BOMBAY)
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S. 127(2) Transfer of case: The existence of agreement between two jurisdictional Commissioners is a condition precedent for passing the order of transfer. The agreement cannot be implied because S. 127(2) (2) (a) contemplates a positive state of mind of the two jurisdictional CsIT. Absence of disagreement cannot tantamount to agreement
Rentworks India Private Limited vs. Pr CIT
(2018) TaxCorp(LJ) 14233 (HC-BOMBAY) · Section. 127(2)
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S. 14A/ 115JB: Amount disallowed u/s 14A of the Act cannot be added to arrive at book profit for purposes of section 115JB of the Act
CIT vs. Bengal Finance & Investments Pvt. Ltd
(2018) TaxCorp(LJ) 14109 (HC-BOMBAY) · Sections 14A, 115JB
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Sales-tax/VAT Tribunal: (i) Only legally qualified, judicially trained and experienced persons can be appointed Members. A Chartered Accountant or Commissioner cannot be appointed unless they have expertise in the subject. (ii) The Selection Committee should be headed by either a sitting Judge or a retired Judge of the High Court. (iii) It is the constitutional obligation of the State to provide proper infrastructure to the Courts, Tribunals and Judicial Officers. Financial constraint on the part of the Government is no ground to deny the adequate infrastructure to the Courts and Tribunal. (iv) For complete transparency, the Tribunal will have to ensure that its records are digitized and all orders, short or long, are uploaded on a dedicated website
Sales Tax Tribunal Bar Association vs. State of Maharashtra
(2017) TaxCorp(LJ) 14085 (HC-BOMBAY)
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Sales-tax/VAT Tribunal: (i) Only legally qualified, judicially trained and experienced persons can be appointed Members. A Chartered Accountant or Commissioner cannot be appointed unless they have expertise in the subject. (ii) The Selection Committee should be headed by either a sitting Judge or a retired Judge of the High Court. (iii) It is the constitutional obligation of the State to provide proper infrastructure to the Courts, Tribunals and Judicial Officers. Financial constraint on the part of the Government is no ground to deny the adequate infrastructure to the Courts and Tribunal. (iv) For complete transparency, the Tribunal will have to ensure that its records are digitized and all orders, short or long, are uploaded on a dedicated website
Sales Tax Tribunal Bar Association vs. State of Maharashtra
(2017) TaxCorp(LJ) 14071 (HC-BOMBAY)
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S. 147/ 292B: Sanction for issuing a reopening notice cannot be mechanical but has to be on due application of mind. Sanction accorded despite mention of non-existent section in the notice is prima facie evidence of non application of mind on the part of the sanctioning authority. S. 292B cannot cure such defect
Kalpana Shantilal Haria vs. ACIT
(2017) TaxCorp(LJ) 14067 (HC-BOMBAY) · Sections 147, 292B
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S. 80-IA(5): Only losses of the years beginning from the initial assessment year are to be brought forward for set-off against profits of the eligible unit. Losses of earlier years which are already set off against income cannot be brought forward notionally for set-off. The fiction in s. 80-IA(5) is created only for a limited purpose and cannot be extended
CIT vs. Hercules Hoists Ltd
(2017) TaxCorp(LJ) 14066 (HC-BOMBAY) · Section 80-IA(5)
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S. 2(47)(v): Immovable property can be regarded to have been transferred on the date of execution of the Development Agreement and irrevocable General Power of Attorney only if the terms indicate that complete control is given to the developer. If the entire consideration is not received by the assessee and physical possession of the property is not parted with, there is no transfer u/s 2(47)(v)
CIT vs. Dr. Arvind S. Phake
(2017) TaxCorp(LJ) 14040 (HC-BOMBAY) · Section 2(47)(v)
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Bogus LTCG from Penny stocks: The assessee has not tendered cogent evidence to explain how the shares in an unknown company worth Rs.5 had jumped to Rs.485 in no time. The fantastic sale price was not at all possible as there was no economic or financial basis to justify the price rise. the assessee had indulged in a dubious share transaction meant to account for the undisclosed income in the garb of long term capital gain. The gain has accordingly to be assessed as undisclosed credit u/s 68
Sanjay Bimalchand Jain vs. Pr CIT
(2017) TaxCorp(LJ) 14009 (HC-BOMBAY) · Section 68
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S. 271(1)(c) Penalty: The requirement to obtain previous approval of the IAC is mandatory as it is to safeguard the interests of the assessee against arbitrary exercise of power by the AO. Non-compliance may vitiate the penalty order. However, the requirement in s. 274 that the assessee must be given a reasonable opportunity of being heard cannot be stretched to the extent of framing a specific charge or asking the assessee an explanation in respect of the quantum of penalty proposed to be imposed
Maharaj Garage & Company vs. CIT
(2017) TaxCorp(LJ) 13946 (HC-BOMBAY) · Section 271(1)(c)
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S. 68 Bogus share capital: Companies which invest share capital cannot be treated as bogus if they are registered and have been assessed. Once the assessee has produced documentary evidence to establish the existence of such companies, the burden shifts to the Revenue to establish their case. Reliance on statements of third parties who have not been subjected to cross examination is not permissible. Voluminous documents produced by the assessee cannot be discarded merely on the basis of statements of individuals contrary to such public documents
Pr. CIT. vs. Paradise Inland Shipping Pvt. Ltd.
(2017) TaxCorp(LJ) 13911 (HC-BOMBAY) · Section. 68
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