income tax update 18 november, 2015

INCOME TAX UPDATE 18 NOVEMBER, 2015

INCOME TAX ACT

SECTION 43B

BUSINESS DISALLOWANCE – CERTAIN DEDUCTIONS TO BE ALLOWED ONLY ON ACTUAL PAYMENT

PF contribution : Where employee contributions were not deposited by assessee within due date as prescribed under P.F. Act., but same were made before due date of furnishing return under section 139(1), allowance of deduction of employees contribution to P.F under section 43B was justified – [2015] (Hyderabad – Trib.)

SECTION 80-IC

DEDUCTIONS – SPECIAL PROVISIONS IN RESPECT OF CERTAIN UNDERTAKINGS OR ENTERPRISES IN CERTAIN SPECIAL CATEGORY STATES

Computation of deduction : Assessee company was not entitled to benefit of section 80-IC in respect of sales tax rebate obtained by it – [2015] 252 (Punjab & Haryana)

SECTION 92C

TRANSFER PRICING – COMPUTATION OF ARM’S LENGTH PRICE

Comparables and adjustments/Comparables – Illustrations : In case of assessee, rendering IT enabled services to its AE, companies having related party transactions in excess of 25 per cent could not be accepted as comparables – [2015] (Delhi – Trib.)

SECTION 194A

DEDUCTION OF TAX AT SOURCE – INTEREST OTHER THAN INTEREST ON SECURITIES

Payment to statutory corporation : While making payment of interest by assessee-bank to NOIDA, a statutory corporation established under UP Industrial Area Development Act, 1976, tax was not required to be deducted at source – [2015] (Delhi – Trib.)

SECTION 148

INCOME ESCAPING ASSESSMENT – ISSUE OF NOTICE FOR

Service of notice : In order to complete reassessment, notice under section 148 has to be mandatorily served upon assessee in accordance with section 282(1), read with Order V, Rule 12 CPC and Order III Rule 6 CPC –[2015](Delhi)

SECTION 263

REVISION – OF ORDERS PREJUDICIAL TO INTEREST OF REVENUE

Difference of opinion : Where on same set of evidence produced by assessee, Assessing Officer and Commissioner draw different opinions, such difference of opinion cannot be a basis to invoke jurisdiction under section 263 – [2015]  (Chandigarh – Trib.)

 

SECTION 269T

LOANS DEPOSITS MODE OF TAKING OR ACCEPTING

Where assessee firm repaid loan amount in cash to another firm, in violation of provisions of section 269T, mere fact that one partner was common in both firms, it could not be taken as a case of inter-firm transactions and, therefore, penalty order passed under section 271E was to be confirmed – [2015] (Karnataka)

SECTION 292BB

NOTICE DEEMED TO BE VALID IN CERTAIN CIRCUMSTANCES

Where prior to completion of reassessment, assessee raised an objection that he had not been duly served in accordance with section 148, proviso to section 292BB was attracted and revenue could not take advantage of main portion of section 292BB – [2015] (Delhi) 

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