Professional Update For the Day:


Direct Tax:-

  • CBDT issued clarification regarding Chapter VI-A deduction on enanced profits vide Circular No. 37/2016 dated 02/11/2016.(Click here to view)
  • Kerala High Court in the below citied case held that the assessment proceedings generated by the issuance of a notice u/s 153A (1)(a) can be concluded against the interest of the assessee including making additions even without any incriminating material being available against the assessee in the search u/s 132 –  [E.N. Gopakumar Vs. CIT (Central)]
  • HC allows withdrawal of oppression petition as other shareholders approached CLB on similar issue Karnataka Theaters Ltd. v. Ratnavarma Padival [2016] 74 230 (Karnataka)
  • CBDT:Deduction under Chapter VI-A is admissible on the Enhanced profits  by the disallowance made under sections 32, 40(a)(ia), 40A(3), 43B, etc. –  Circular # 37, dt.02.11.2016.
  • IT:Expenditure related to exempted income – Provisions of Sec.14A are clearly applicable to the investment made in a EOU covered under u/s 10B – Riviera Home Furnishings Pvt. Ltd. Vs ACIT, Range-15, New Delhi (Vice Versa) (2016 (11) TMI 256 – ITAT Delhi)
  • IT:Disallowance of expenditure on advertisement on television – the corporate advertisement expenditure facilitates the business having a direct impact on sales and profitability of the Assessee – CIT, Mumbai Vs Asian Paints (India) Ltd. (2016 (11) TMI 258 – Bombay High Court)
  • Validity of reopening of assessment – Since this is a case of original non-scrutiny assessment, the concept of change of opinion cannot be applied – Gujarat High Court in case of [Gujarat State Board of School Textbooks Vs. ACIT Gandhinagar Circle].
  • Capital gain tax will be paid by the partners of the dissolved partnership firm on the sale of its assets.{Vatsala Shenoy Vs. JCIT, Supreme Court of India}..
  • Since no material whatsoever was found in the course of search, the question of allowing additional depreciation or not could not have been subject matter of proceedings u/s 153A of the Act – ITAT KOLKATA in case of [M/s. Ujjal Transport Agency Vs.  CIT, Kolkata].
  • Mere default in furnishing Form 15G/15H doesn’t call for sec. 40(a)(ia) disallowance. Assistant Commissioner of Income-tax, Circle 1(1), Tirupati v. Chittoor Dist. Co-operative Central Bank Ltd. [2016] 74 202 (Hyderabad – Trib.).
  • ITAT kolkata in the below citied case held that Since no material whatsoever was found in the course of search, the question of allowing additional depreciation or not could not have been subject matter of proceedings u/s 153A of the Act [M/s. Ujjal Transport Agency Vs.  CIT, Kolkata].


Indirect Tax:-

  • CBEC issued a Defferd payment of Import duty Rules vide Notification No. 134/2016 dated on02/11/2016.(Click here to view)
  • Valuation – inclusion of royalty in the value of imports – Running royalties are condition of sale for the transaction value and thus needs to be added in the value for the purpose of payment of Customs duty. – Tri – Customs. Commissioner of Central Excise, Mumbai Versus Herbalife International India Pvt. Ltd. – 2016 (9) TMI 830 – CESTAT MUMBAI
  • VAT:Nothing prevents a constitutional court from granting interest on refund in extraordinary circumstances where the money has been withheld by the State for a long period of time without any authority in law – Indian Farmers Fertiliser Co.Op. Ltd. Vs State of Guj. (2016 (11) TMI 215 – Gujarat HC).
  • VAT:4% or 12.50% – tissue paper napkin, toilet paper rolls etc. retain the essential characteristics of paper – to be taxed at 4% – S. R. Foils & Tissue Ltd. Vs The State of Haryana & Anr (2016 (11) TMI 216 – Punjab & Haryana High Court)
  • Import of cosmetics and exporting the same after reassembling tantamounts to manufacturing
  • Commissioner of Customs v. Baccarose Perfumes & Beauty Products Ltd. [2016] 4 222 (SC)
  • Penalty could be levied under omitted provision which was validated retrospectively Bharat Steel Rolling Mills v. Commissioner of Central Excise [2016] 74 259 (SC)


  • GST Registration started from today (08.11.2016) at Assessees with verified PAN are allowed to fill details and submit proofs.
  • Under  GST GSTIN generated in phased manner. Already done for 20 lac VAT assessees in 8 states. Others to get later. ST Assessees to get in Jan’17.


  • HC rejects PIL for scrapping of notification on demonetization.)
  • Payment Systems (RTGS, NEFT, Cheque Clearing, Repo, CBLO and Call markets) to remain open on Saturday, November 12 and Sunday, November 13, 2016
  • No cash refund for Rail ticket cancellation of Rs.10,000­ & above
  • Updated Point of Taxation Rules, 2011 {Notification No. 18/2011-S.T., dated 1-3-2011)
  • PNB invites applications from CA /Advocates for empanelment as (i) Tax Retainer; and (ii) Tax Consultants.
  • PNB invites applications from practicing ‘Partnership firms of CA in India’  to have their Firms empanelled as Revenue Auditors of branches.

We look forward for your valuable comments.

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