Seeds or crops produced at first level by assessee would constitute agricultural income as per rule 7(I)(a).

Pioneer Overseas Corporation vs. Dy. CIT (2010) 35 SOT 467 (Delhi)

In order to achieve objects of giving relief to poor and in furtherance of education and medical relief, if assessee was running some activity that yielded profit, even then registration cannot be denied.

Prasanna Trust vs. DIT (2010) 36 SOT 135 (Bang.)

Transactions in the normal course of business cannot be treated as deemed dividend more so as the assessee is not a share holder of the payer company and none of the shareholders of the latter is a share holder in the assessee company having substantial interest.

Dy. CIT vs. Timeless Fashions (P) Ltd. (2010) 128 TTJ 489 (Delhi)

The purpose of the grant or the subsidy being for the construction of the capital assets viz. the tube wells and lift irrigation schemes, which constitute the permanent apparatus from which the assessee derives income by way of water charges, the subsidy has to be held to constitute capital receipt by applying the "purpose test".

Gujarat Water Resources Development Corporation Ltd vs. Jt. CIT, ITA No. 167/168 Bench A dt. 16-10-2009 (Feb., 2010 P. 594 Vol. 33 Part 11. Ahmedabad Chartered Accountants Journal)

Where amount received by assessee was not in her capacity as employee, but was only compensation for injury caused to her by denying her employment, after having been declared employable by following a discriminatory general practice prohibited by law in USA, it amounted to capital receipt not liable to tax. So far as pre-judgment interest on amount of compensation was concerned, if it was a part of settlement amount, its character would be same as that of principal amount of compensation i.e., Capital receipt, not liable to tax.

ACIT vs. Rani Shanker Mishra (Smt.) (2010) 122 ITD 360 (Delhi)

Compensation received for forgoing right to sue for specific performance of contract not a trading liability, the said amount being on account of capital account is a capital receipt.

Govindbhai C. Patel vs. Dy. CIT (2010) 1 ITR 34 (Ahd.).

Contractual payment made by the assessee firm to its retiring partners, in terms of partnership deed, is not includible in the total income of the assessee since to that extent income has never reached the hands of the assessee.

RSM & Co. vs. ACIT ITA No. 3269/Mum./2007, January (2010) BCAJ Vol. 41-B

Incentives in the form of excise duty refund and interest subsidy which has been granted for substantial expansion of unit, only after commencement of production and not for setting up of new industries or to purchase capital assets, same constitute revenue receipt.

Shree Balaji Alloya vs. ITO (2010) 33 DTR 67 (Asr.) / (2010) 127 TTJ 129 (Asr.)

Assessee was running a recreation club for its members. Its receipts from providing food, room facilities to its members and their guest was not liables to tax.

Delhi Gymkhana Club Ltd. vs. Dy. CIT (2010) 35 SOT 335 (Delhi)

Foreign company not liable to tax in India if Indian agent is paid on arm’s length basis.

BBC Worldwide vs. DDIT (2010) 35 DTR 257 (Delhi)(Trib.).

Liaison office of the South Korean company being engaged in procuring purchase orders in India for the latter after negotiating the deal, there exists a business connection in India. Liaison office is also a PE, with in meaning of Article 5 of the DTAA between India and South Korea as it is having freedom to fix the sale price and conclude the contract and therefore, its activities could not be of preparatory or auxiliary nature. Income attributable to the Liaison office is taxable under Article 7 of the DTAA.

Dy. CIT vs. Jebon Corporation India Liaison Office (2010) 127 TTJ 98 (Bang.)

Amount received under license agreement for allowing use of software, not royalty but business profits. Receipts on account of maintenance charges and training fees incidental to software receipts is of same character.

Infrasoft Ltd. vs. ADIT (2010) 1 ITR 390 (Delhi).

Deduction has to be made at the stage of computing the income under head "Profits & gains" and not at the stage of computing the gross total income. The deduction under section 10A attaches to the undertaking and not to the assessee. The losses of a non-eligible unit cannot be set off against the profits of an eligible unit and are eligible to be set-off against other income or to be carried forward.

Scientific Atlanta vs. ACIT (2010) 2 ITR 66 (Chennai)(SB).

Interest earned on fixed deposits and miscellaneous income, is not profit derived by an undertaking from export, hence not exempt under section 10A.

Global Vantedge P. Ltd. vs. Dy. CIT (2010) 1 ITR 326 (Delhi.)(Trib.)

For the Asst. Year 2003-04, assessee claimed under section 80HHE in respect of period 1-4-2002 to 13-1-2003 and further claimed deduction under section 10A, in respect of profits from 14-1-2003 to 31-3-2003 as the registration was obtained only from 14-1-2003. The Tribunal held that as the assessee computed profits for two periods on reasonable basis, the claim of assessee is allowed.

ITO vs. Vidya Tech Solutions (P.) Ltd. (2010) 35 SOT 25 (Delhi)

16. S. 10A – Exemption – Unit Outside Stp

Profits and gains on domestic sales not exceeding twenty five percent of total sales shall also be deemed to be profits and gains derived from export of articles qualifying deduction under section 10A. Where assessee company had made local sales of raw materials as well as of finished goods to its holding company, value of said sales was to be included in total sales for the purpose of calculating benefit of deduction under section 10A.

T. Two International (P.) Ltd. vs. ITO (2010) 122 ITD 255 (Mum.)

After the amendment with effect from April 1, 2001, onwards the brought forward loss pertaining to the specific undertaking eligible for deduction under section 10A are allowed to be carried forward and set off against the income of such undertaking in the future assessment year and setoff within the block period itself.

Global Vantedge P. Ltd vs. Dy. CIT (2010) 1 ITR 326 (Delhi).

Brought forward losses are is be adjuster against total income of relevant assessment year and, it is out of balance income only that deduction under section 10B can be granted.

Sword Global (I) (P) Ltd. vs. ITO (2010) 122 ITD 103 (Chennai)

Export incentive which are includible in the profits of the business of the undertaking are entitled to exemption under section 10A.

Wipro Ltd. vs. Dy. CIT (2010) 34 DTR 493 (Bang.).

Assessee having provided the services of recruitment and training of software professionals to its parent company in USA by storing the relevant data in an electronic device and transmitting the same to USA for the use of the parent company, it is a customized electronic data with in the meaning of clause (I). The assessee is entitled to deduction in India under section 10A in respect of the income earned by it from its parent company for providing the said services.

ITO vs. Accurum India (P) Ltd. (2010) 34 DTR 301 (Chennai)(TM), 128 TTJ 249 (TM)

Long term capital loss suffered prior to 1st Oct. 2004 cannot be set off against capital gain exempt under S. 10(38) but has to be allowed to be carried forward.

G. K. Ramamurthy vs. Jt. CIT (2010) 36 DTR 257 (Mum.)

Brought forward business loss must be set of first against business profits and thereafter any deduction or exemption under the Act has to be given.

Sword Global (I) (P) Ltd. vs. ITO (2010) 122 ITD 103 (Chennai)

Interest income on FDRs and surplus funds could not be held to have been derived from export of information technology services.

Tricom India Ltd. vs. ACIT (2010) 36 SOT 302 (Bom.)

Conversion of warrants into equity shares under scheme, benefit extended to assessee by virtue of employment hence difference between price of shares at time of exercise of option and predetermined price is liable to tax as perquisite under section 17(2)(iiia).

ACIT vs. Tripti Sharma (Smt.) (2010) 1 ITR 471 (Mum.)

The reimbursement of amount received for medical treatment, at the hospital not approved by CCIT or CGHS authorities, due to an accident in place of work during course of employment will not amount to perquisite, liable to be taxed.

Gururaj Mahuli vs. ITO (2010) 187 Taxman 34 (Bang.)

When income has been earned by mere exploitation of ownership of property, the same is assessable as income from house property. If immoveable property has been temporarily let out with primary object to exploit same by way of complex commercial activity, then income is assessable as business income.

Hiranandani Developers (P) Ltd. vs. Jt. CIT (2010) 35 SOT 430 (Mum.)

Non-realisability of balance lying with a bank in FD and current accounts held to be allowable as business loss.

Mehul H. Mehta vs. ITO ITA No. 8531/2004 Bench B dt. 15-6-2009. March BCAJ P. 17. 645 (2010) 41-B BCAJ.

The assessee was entitled to write off the obsolete items out of inventories acquired by it in its books of account for the year ending 31st march 1998, even though the process of determination of diminution in the value of inventory was undertaken at a later date.

Kopran Drugs Ltd. vs. ACIT (2010) 35 DTR 380 (Mum.)

Interest paid to partners is allowable deduction when business is temporarily suspended.

ITO vs. M. M. Textiles (2010) 122 ITD 435 (Mum.)

Assessee, his wife and son jointly purchased land on 2nd March, 1997, and soon thereafter applied for converting the same into housing plots though sanction was given by the concerned development authority in 2001. They sold all the eight plots during the financial year 2004-05. Co-owners of the assessee have no record of carrying on of agricultural operations. Two of the three co-owners are engaged in the business of automobile spare parts. Even though the conversion of land materialized in the year 2001 only, in the absence of any evidence to show that the land was used for some other purpose prior to seeking approval of the layout plan, the intention of purchase of land cannot be automatically inferred as an investment. Thus, the attendant circumstances of the case lead to the conclusion that the land was purchased with the intention to sell the same at a profit. Therefore, though an isolated transaction, it was an adventure in the nature of trade and the income therefrom has to be treated as business income.

Cherukuri Ramesh vs. ACIT (2010) 36 DTR 269 (Visakha)

Commercial rights of exploration of mineral oils acquired by assessee by entering in to production sharing agreement with the Russian Government fall under the expression ‘any other business or commercial rights of similar nature’ same being akin to "licence" as stipulated in section 32(1)(ii) and therefore, they are in the nature of intangible assets eligible for depreciation.

ONGC Videsh Ltd. vs. Dy. CIT (2010) 33 DTR 22 (Delhi)

Editorial Note: See Bombay High Court CIT vs. Techno Shares & Stocks Ltd. (2009) 184 Taxman 103 (Bom.)

Assessee is entitled to higher rate of depreciation as per Appendix I, Income Tax Rules, 1961 Entry III(3)(ii) in respect of motor cars used in the business of running them on hire.

Magma Fincorp Ltd. vs. ACIT (2010) 35 DTR 76 (Kol.)

Assessee being engaged in building flyover, roads, bridges, express highways, ROB, etc. and carrying on its activities of developing and maintaining infrastructure facilities by permitting vehicles to ply over these structures, they are tools of the trade and essential adjuncts to the business and therefore, constitute plant entitled to depreciation at 25 per cent.

Maharashtra State Road Development Corporation Ltd. vs. ACIT (2010) 128 TTJ 32 (Mum.) , (2010) 34 DTR 389 (Mum.)

Profits derived from operating and maintaining barges belonging to another person would qualify for deduction under section 33AC.

Dy. CIT vs. Orion Agencies Ltd. (2010) 128 TTJ 524 (Mum.)

Expenditure covered under section 35AB has to be in nature of capital expenditure as scheme of Act, is that all revenue expenses are allowable while computing income from business or profession under section 37.

Mahindra & Mahindra Ltd. vs. Jt. CIT (2010) 36 SOT 348 (Mum.)

Deduction under section 36(1)(viia) has to be allowed before making any deduction under section 36(1)(viii).

Tourism Finance Corp. of India vs. Jt. CIT (2010) 128 TTJ 43 (Del.)

Though every member of National Stock Exchange is obliged to abide by its rules and regulations, fine imposed on the assessee a member of NSE for violation of regulations of NSE cannot be disallowed.

Gold Crest Capital Markets Ltd. vs. ITO (2010) 36 DTR 177 (Mum.)

Refundable deposit with stock exchange is not a deductible expenditure.

Dy. CIT vs. Khandwala Finance Ltd. (2010) 122 ITD 111 (Mum.)

The expenses relating to agricultural operations could not be allowed as expenditures in computing the business incomes for the simple reason that agricultural income did not form part of the total income under the Act.

Kancor Flavours & Extracts Ltd. vs. Dy. CIT (2010) 123 ITD 97 (Cochin)

A finance company having purchased computers and peripherals on 4th Sept 1995, appointed staff, in September and October 1995, and salaries including allowances, bonus, gratuity and contribution to provident fund and other funds from November 1995, its business can be said to be set up on 1st November, 1995, when it was in a position to commence its business and not when its bank account was opened. Expenditure incurred thereafter is allowable as deduction.

CIT vs. Whirlpool of India Ltd. (2010) 229 CTR 435 (Del.)

Any payment made for the purpose of compliance with the provisions of law would tantamount incidental to carrying on the business. Payments made by the assessee under the 2002 scheme cannot for the purpose of disallowance under the Explanation be treated as penalty or akin to penalty under section 37 of the Income Tax Act, 1961.

Kaira Can Co. Ltd. vs. Dy. CIT (2010) 2 ITR 20 (Mum.)(Trib.)

By incurring expenditure on advertisement and sales promotion, assessee had not acquired any fixed capital asset, but these expenditure were incurred for earning better profits and for facilitating assessee’s operation of providing cellular mobile services hence, allowable as business expenditure.

ITO vs. Spice Communications Ltd. (2010) 35 SOT 78 (Delhi)

Assessee engaged in the business of exploration and production of oil is entitled to deduction of expenditure pertaining to abandoned project.

ONGC vs. Dy. CIT (2010) 33 DTR 22 (Delhi)

Refundable deposits placed with stock exchange cannot be allowed as deduction under section 37.

Dy. CIT vs. Khandwala Finance Ltd. (2010) 122 ITD 111 (Mum.)

Membership card of stock exchange is a capital asset and therefore any expenditure incurred to acquire said card is capital in nature.

Dy. CIT vs. Khandwala Finance Ltd. (2010) 122 ITD 111 (Mum.)

Expenditure incurred for restoring roof to original condition is not a capital expenditure. Expenditure on removal of defect in design of car, relates to stock in trade of assessee is not a capital expenditure.

Honda Siel Cars India Ltd. vs. ACIT (2010) 1 ITR 497 (Delhi)(Trib.)

In collaboration agreement assessee obtained only right to use technical knowhow. Payment of lump sum fees and royalty is allowable as revenue expenditure.

Honda Siel Cars India Limited vs. ACIT, Circle, Noida (2010) 40 TLR (Part 466) 1 (Delhi) (AT)

Payment made by assessee on the direction of the State Government to suppliers who supplied fodder to various cattle camps in the wake of drought conditions, for maintaining smooth relations with the Government, satisfies the test of commercial expediency and therefore allowable under section 37.

Surat Electricity Co Ltd. vs. ACIT (2010) 35 DTR 272 (Ahd.)(Trib.)

Advance payment made for purchase of machinery written off as business loss. Hon’ble Tribunal allowed the Appeal by Relying on the Hon’ble High Court of Rajasthan in the case of CIT vs. Anjani Kumar Co. Ltd. 259 ITR 114 (Raj.).

Pik Pen Pvt. Ltd. vs. ITO (Mum.) (Trib.) Source: www.itatonline.org

Assessee company was in business of providing mobile telephone services since 1997 under brand name "Spice" – Expenditure incurred on advertisement and sales promotion was held to be revenue expenditure as the assessee had not acquired any fixed capital asset, but these expenditures were incurred for earning better profits and for facilitating assessee’s operation of providing mobile services. Expenses incurred for up gradation of software also held to be revenue in nature– In the event of composite payments made by assessee for supply of technical know how services and for use of Intellectual Property Rights for setting up cellular telecom network or business, and also for operating and carrying on efficiently and profitably its business of providing telecom services – 25% expenditure capital in nature and 75% revenue in nature.

ITO vs. Spice Communications Ltd. (2010) 35 SOT 78 (Delhi)

Expenditure incurred on construction and renovation for a new shop in the leased premises was held to be allowable as Revenue expenditure.

Viswams vs. ACIT (2010) 186 Taxman 25 (Chennai)

Payment made on the direction of the State Government to suppliers who supplied fodder to various cattle camps satisfies the test of commercial expediency and therefore it is an allowable deduction under section 37(1). Also see Na129

Surat Electricity Co. Ltd. vs. ACIT (2010) 128 TTJ 696 (Ahd.)

Amounts paid to speed up the operations in ports were allowable as business expenditure.

ACIT vs. Kin Ship Services (I) P. Ltd. (2010) 128 TTJ 108 (Coch.)

SEBI had barred the assessee from doing business till further orders and thus not doing business activity was on account of forced circumstances and not voluntarily and therefore assessee was entitled to deduction for business expenditure, interest etc.

KNP Securities (P) Ltd. vs. ACIT (2010) 33 DTR 210 (Mum.)

Assessee taking vehicles on hire for purpose of executing contract, not a case of sub, contract. Tax need not be deducted at source. Payment allowable.

Mythri Transport Corporation vs. ACIT (2010) 1 ITR 290 (Visakha.)

During assessment year 2000-01, assessee company made royalty payment to its holding company in US after deducting TDS, however, paid amount so deducted in the Asst. Year 2001-02. As per proviso to section 40(a)(i) deduction is allowable to assessee in subsequent year in which TDS has been paid or deducted under Chapter XVIIB, however in the present case TDS had been paid by assessee in present year although deducted in preceding year hence its claim for deduction was allowable.

McDonalds (India) (P) Ltd. vs. ACIT (2010) 36 SOT 240 (Delhi)

Steep increase in remuneration payable to directors, held disallowance is proper.

Shree Laxmi Marketing vs. ACIT (2010) 40 Tax LR 106 (Pune)

Charter hire charges paid to foreign Ship did not constitute royalty payments. Section 9 is not attracted nor is there any liability for TDS and consequently section 40(a)(i) cannot be invoked.

ACIT vs. Kin Ship Services (India) (P) Ltd. (2010) 128 TTJ 108 (Coch.)

If the assets disclosed during the survey are identified with the business of the assessee then the same have to be treated as part of business income while computing total income, and the consequential deduction under section 40(b) has to be allowed.

Fashion World vs. ITO, ITA No. 1634 Bench B dt. 12-2-2010 (Feb, 2010, 598 Ahmedabad Chartered Accountants Journal)

Trade discount allowed by the assessee to its sister concern on the sales made could not be disallowed in part by invoking section 40A(2).

ACIT vs. Grandpix Fab. (P) Ltd. (2010) 128 TTJ 60 (Del.)

Waiver of loan to discharge the liabilities of business to recoup losses over period of time were consequential to contractual agreement, cannot be assessed under section 41(1).

Mindteck (India) Ltd. vs. ITO (2010) 122 ITD 486 (Mum.)

Assessee company claimed depreciation at 100% on wind mill project which was allowed. Subsequently the wind mills were destroyed in cyclone against which assessee received certain amount from insurance company. Revenue authorities brought said amount to tax under section 41(1) of the Income Tax Act. The Tribunal held that the amount received from insurance company cannot be taxed under section 41(1).

Rajhans Metals (P) Ltd vs. ITO (2010) 122 ITD 189 (Mum.)

In order to apply Expl. 3 to section 43(1), Assessing Officer has to determine the actual cost of the assets to the assessee which can only mean arm’s length value or real value or worth of assets transferred. Burden is on Assessing Officer to establish that actual cost is not proper.

Chitra Publicity Company (P) Ltd. vs. ACIT (2010) 127 TTJ 1 (Ahd.)(TM)

Delayed payment of employees’ PF contribution allowable under section 43B

Pik Pen Pvt. Ltd vs. ITO (Mum.) Source: www.itatonline.org

When income of the assessee under section 44BBB is to be computed at 10 per cent of gross receipts and the assessee does not claim a lower profit than that to be assessed under sub Section (2) of section 44BB, Assessing Officer cannot proceed to determine income of assessee under sections 28 to 44AA on the pretext of consistency, assessee is also entitled to set off losses in other business from such income.

DSD Industrieanlagen GmbH vs. Dy. CIT (2010) 36 DTR 121 (Delhi)

The taxability of income of insurance companies under the head ‘Income from business and profession’ as governed by provisions of section 44, read with First Schedule to the Act, did not extend to taxability of profits on sale of investments – so far as the relevant Assessment Years were concerned.

General Insurance Corporation of India vs. ACIT {2010) 35 SOT 161 (Mum.)

Loss arising from write off of shares held as capital asset is capital loss and not revenue loss.

Tourism Finance Corp. of India vs. Jt. CIT (2010) 128 TTJ 43 (Del.)

Assessee engaged in trading of shares as well as investment in shares profit on sale of investment shown as short term capital gains or longs term investments is assessable as capital gains and not as business income.

Paresh D. Shah vs. Jt. CIT (2010) 2 ITR 311 (Mum.)(Trib.)

Forfeiture of convertible warrants results in extinguishment of right of the assessee to obtain a share in the company and results in loss under the head "capital gains".

CIT vs. Chand Ratan Bagri (2010) 36 DTR 244 (Del.)

Solitary transaction of purchase and sale of land made by the assessee company after retaining it for about ten years without undertaking any steps towards development of property or treating it as stock-in-trade cannot be regarded as business activity and, therefore, the gain arising on the sale of land is assessable as Capital gains.

ITO vs. Baguio Investment (P) Ltd. (2010) 33 DTR 457 (Pune)

It is the date of grant of the stock option in favour of the assessee that is material for determining the period of holding the asset in question and not the date on which the option was exercised and stock options were converted into shares. Capital gains arising out of sale of shares acquired through ESOPs have to be assessed as long term capital gains with consequential benefit of indexation and exemption under section 54.

ACIT vs. Dr. Dhurjati Gupta (2010) 33 DTR 287 (Hyd.)(Trib.)

Assessee company earning income from the sale of shares. Assessing Officer holding that income earned was from speculation and on the fact it was held that income earned was in the nature of capital gains.

Axis Capital Markets (India) Ltd. vs. ITO ITA No. 4098/Mum./2007 BCAJ January (2010) Vol. 41-B

Enhanced compensation for acquisition of land is taxable in the year of receipt and cannot be taxed in different years in which it accrued.

ITO vs. Roop Singh (2010) 127 TTJ 377 (Del.) / (2010) 33 DTR 257 (Delhi)

Transfer of trademarks being transfer of capital asset, gains arising therefrom chargeable to Capital Gains tax. Cost of acquisition being indeterminable long term capital gains is not liable to any tax. Matter remanded to decide the period of holding and to tax gains if held to be short term gains.

Trent Brands Ltd. vs. ITO (2010) 127 TTJ 65 (Delhi)(UO)

Assessee’s right as lessee is capital asset. Receipt of one time fee for foregoing right to use property assessable as capital gains.

ACIT vs. United Motors (I) Ltd. (2010) 1 ITR 578 (Mum.), (2010) 34 DTR 399 (Mum.)

When possession was handed over and total consideration was also agreed upon by parties and vendee was allowed to enjoy and entertain property for purpose for which it was taken over, then the transaction had fulfilled conditions required under section 53A, of Transfer of Property Act, 1982, and therefore, it was covered under definition of ‘Transfer’ under section 2(47)(v).

R. Kalanidhi vs. ITO (2010) 122 ITD 388 (Chennai)

Assessee having converted land into stock in trade in an earlier year and sold the same in the relevant year by executing a general power of attorney, showing it as sale of stock-in-trade and crediting the sale proceeds land stood "otherwise transferred" and hence, capital gain is taxable under section 45(2) in the relevant assessment year though no conveyance deed was registered.

Wipro Ltd. vs. Dy. CIT (2010) 34 DTR 493 (Bang.)(Trib.)

Conversion of proprietary concern into firm in 1994. Valuation of assets and credit in same year. Transaction gave rise to capital gains.

Dharamshibhai B. Shah vs. ITO (2010) 1 ITR 536 (Ahd.)

Where the land held by assessee company as stock in trade was contributed as capital in a partnership firm after revaluing the same, the surplus was assessable as capital gains by application of section 45(3). Even otherwise, transaction of such conversion was device or ruse to convert the land in to money substantially for the benefit of the assessee and therefore same was assessable as business income.

DLF Universal Ltd. vs. Dy. CIT (2010) 34 DTR 105, 36 SOT 1, 128 TTJ 121 (Delhi)(SB)

For the relevant assessment year, assessee computed his capital gains by taking cost of acquisition of said property on basis of value of shares purchased by him. Assessing Officer held that since the capital asset became assessee’s property on distribution of same by company in-liquidation, cost of acquisition of said asset had to be taken as cost to previous owner as per section 49(1)(iii)(c). The Tribunal confirmed the view of Assessing Officer.

ACIT vs. T. R. Srinivasan (2010) 36 SOT 312 (Chennai)

For the purpose computing long term capital gain arising from the transfer of a capital asset which had become property of the assessee under gift, the indexed cost of acquisition of such capital asset had to be computed with reference to the year in which the previous owner first held the asset.

Dy. CIT vs. Manjula Shah (2010) 35 SOT 105 (Mum.)(SB)

When sale consideration is less than the price determined by stamp valuation authority, assessing officer has no option but to adopt the valuation made by the stamp valuation authority.

Mohd. Shoib vs. Dy. CIT (2010) 1 ITR 452 (Luck.)/ (2010) 127 TTJ 459 (Luck.)

Substitution of sales consideration on transfer of land and building with the value adopted by the stamp valuation authority. Assessee objecting to the substitution of sales price. AO has no discretion and should refer the matter to valuation officer to determine fair value.

Abbas T. Reshamwala vs. ITO, ITA No. 3093/Mum./2009, January (2010) BCAJ Vol. 41-B

Difference between consideration shown in sale deed and valuation taken for stamp purposes cannot be added as unexplained investment in the hands of purchaser.

ITO vs. Fitwell Logic system P. Ltd (2010) 1 ITR 286 (Delhi)(Trib.)

Sale of stock-in-trade. Officer making addition in sale price based on fair market value arrived are rent capitalisation method. Addition made not justified.

ACIT vs. Excellent Land Developers P. Ltd. (2010) 1 ITR 563 (Delhi)

Editorial Note:- Refer CIT vs. Thiruvengadam Investments (P) Ltd. (2010) 34 DTR 81 (Mad.), 320 ITR 345 (Mad.) / Inderlok Hotels P. Ltd. vs. ITO (2009) 318 ITR 234 (At) (Mum.)

Stamp duty valuation is not applicable in respect of sale of assets where depreciation has been allowed.

Panchiram Nahata vs. Jt. CIT (2010) 127 TTJ 128 (Kol.)(UO)

Transfer of tenancy right. As in the case of assessee, the capital assets transferred was tenancy right, held that such transaction not covered under the provisions of sec. 50C.

Kishori Sharad Gaitonde vs. ITO, ITA No. 1561/M/09, BCAJ Pg. 28, Vol. 41 B Part 5, February 2010

Provisions of S. 50C do not apply to the purchaser of property. S. 69B requires collection of independent evidence to show that any undisclosed investment was made by the assessee in purchase of property failing which the buyer could not be saddled with the liability on account of undisclosed investment.

ITO vs. Smt. Kusum Gilani, ITA No. 1576/Del/08, BCAJ P. 16, Vol. 41 - B Part 6, March 2010

Value adopted by assessee much higher than fair market value, reference to valuation officer permissible. Average of both valuation was taken.

Valuation charges incurred by assessee, not spent in connection with cost of acquisition or cost of improvement of asset hence not deductible.

VijayKumar M. Shah vs. Dy. CIT (2010) 2 ITR 116 (Mum.)

Editorial Note:– Refer Bombay High Court Judgment Daulat Mota HUF ITA no. 1031 of 2008 dt. 22-9-2008 (Unreported), Smt. Krishnabai Tingre (2006) 101 ITD 317 (Pune)

Interest received by assessee on advances given to contractors for undertaking the expansion project of its refinery, though treated as part of business income is to be adjusted in the work in progress.

Mangalore Refinery & Petrochemicals Ltd. vs. ACIT (2010) 128 TTJ 285 (Mum.)

Assessee and his wife partners in a firm. Assessee’s wife getting allowance from firm in terms of partnership deed and shown the income in her return as business or profession. Assessment of assessee’s wife completed assessing the income under section 28(v). Income cannot be includible in the hands of assessee.

Dy. CIT vs. A. V. Jose (2010) 1 ITR 88 (Kochin)(Trib.)

Sum received from NRE account of non– resident Indian is entitled to immunity under Remittances of Foreign Exchange and Investment in Foreign Exchange Bonds (Immunities and Exemptions) Act, 1991 addition as cash credit cannot be made.

Amritlal S. Punamiya HUF vs. ITO (2010) 1 ITR 242 (Mum.) (Trib.)

In the course of survey excess cash was found, the assessee’s statement was recorded under section 131, he offered the same as income. In the return the assessee has not shown the income offered in the course of survey. The Explanation was offered stating that the said amount was withdrawal from the bank. The Tribunal confirmed the addition by applying the test of human probabilities.

Shree Mahalaxmi Rice Mill vs. ITO (2010) 122 ITD 1 (Nag.)(TM)

In the absence of any material on record to show that the assessee has in fact paid on money for the purchase of flat, addition could not be made in the hands of the assessee merely on the basis of the statement of a partner of the vendor firm or the notings on a document which was seized from the business premises of the said firm.

Jawaharlalbhai Atmaram Hatthiwala vs. ITO (2010) 128 TTJ 36 (Ahd.)(UO)

Non-exempt capital loss cannot be set off against exempt capital gains

G. K. Ramamurthy vs. Jt. CIT (2010) 2 ITR 139 (Mum.)

The amendment to S. 74(1)(b) does not apply to long term capital loss incurred prior to AY 2003-04. Long term capital loss of an assessment year prior to AY 2003-04 can be set off even against short term capital gain of AY 2003-04 or thereafter. The Tribunal after considering the decision of Bombay High Court in the case of Central Bank of India, held that the amendment to S. 74(1)(b) is prospective and not retrospective, and that the assessee is entitled to set-off long term capital loss incurred in AY 2002-03 against any income assessable under the head ‘Capital Gains’ for any subsequent year.

Geetanjali Trading Ltd vs. ITO, ITA No. 5428/M/2007, BCAJ Pg. 15, Vol. 41 - B Part 6, March 2010

Assessee having constructed Wing "E" after obtaining commencement certificate in 2002 and 2003 though similar certificates had been obtained prior to 1998, in respect of A, B, C, and D wing, Wing E was a separate housing project and same having been completed before 31st March 2005, the assessee was entitled deduction under section 80-IB(10) in respect of "E" Wing.

Vandana Properties vs. ACIT (2010) 128 TTJ 89 (Mum.)(UO)

TDS in the foreign country is not an amount bought in to India and therefore deduction under section 80O is not allowable on that amount.

Credit has to be allowed against the Indian Tax payable to the extent of tax which was deducted in Thailand and such credit should be restricted to the tax payable in India.

Vikram Tannan vs. ITO (2010) 128 TTJ 509 (Mum.)

The credit could be allowed only against doubly taxed income. Where person is resident is to grant credit for taxes paid in country where income arise but only to extent to which itself levies tax.

There cannot be the payment of tax outside India and claiming refund in India without actually incurring liability for paying taxes in India.

Manpreet Singh Gambhir vs. Dy. CIT (2010) 123 ITD 16 (Delhi)

Excise duty and interest subsidy have no first generation or proximate nexus or source, which is essential for any profit to be treated as ‘derived from’ the industrial undertaking and therefore such receipts are not eligible for deduction under section 80IB.

Shree Balaji Alloys vs. ITO (2010) 33 DTR 67 (Asr.)(Trib.)

Milling of wheat into rawa, bran atta and maida can be considered as manufacture or production of distinct article, things for the purpose of deduction under section 80IB.

Dy. CIT vs. Sri Sai Roller Flour Mills (P) Ltd. (2010) 35 SOT 345 (Hyd.)

Since in proviso, to clause (I) of Explanation to section 80JAA expression ‘existing number of workmen employed’ has been used and not expression ‘existing number of regular workman employed’ for the purpose of computing deduction under section 80JAA, percentage, increase in number of regular workmen has to be determined with reference to existing number of workmen employed in industrial undertaking.

Panacea Biotec Ltd. vs. ACIT (2010) 122 ITD 199 (Delhi)

Income earned by the assessee by exercise of his profession as a Chartered Accountant which has nothing to do with the exercise of his profession as an author is not entitled to deduction under section 80RR.

Dilip K. Sheth vs. ITO (2010) 33 DTR 561 (Mum.)

Receipts incidental to the activities of the assessee "involving the writing of computer software" i.e. set of instructions, were the eligible receipts, so long as the software was exported outside India or technical services were provided outside India, the provisions do not bar the assessee from claiming deduction on the basis of the actual use or utilization of the said exported software in India.

Orbitech Ltd. vs. Jt. CIT (2010) 35 SOT 46 (Mum.)

Sending information which was sought by companies situated abroad, said activity amount to export of customized electronic data hence, the assessee is eligible deduction under section 80HHE.

ACIT vs. Malhar Information Services (2010) 122 ITD 421 (Mum.)

Assessee company being a development organization having made investment in shares of companies promoted by it and other upcoming companies in its role as development organization and not as an investor to earn dividend income, various activities carried out by the assessee constitute one single indivisible business and therefore no expenditure is to be apportioned to the dividend income of the assessee which is assessable as business income and deduction under section 80M is allowable on gross amount of dividend.

Dy. CIT vs. Tamil Nadu Industrial Development Corporation Ltd. (2010) 127 TTJ 625 (Chennai)(TM) , (2010) 34 DTR 233 (Chennai)(TM)

In order to invoke provisions of section 80-IA(9), it is necessary that deductions under section 80HHC & section 80-IA have to be in respect of the same undertaking.

ACIT vs. Grasim Industries Ltd. (2010) 35 SOT 249 (Mum.)

Assessee engaged in producing different varieties of masalas using different spices as inputs, for which even machineries were used for processes like grinding, pulping, drying, etc. and then packing and selling the end product which are different from the different spices used in the process, would amount to manufacturing, and not merely processing so as to deny deduction under section 80-IB.

ACIT vs. Empire Spices & Foods Mumbai Ltd. (2010) 188 Taxman 36 (Mum.)

Date of export out of India. Held that the relevant date was the date when the goods were dispatched and cleared by the customs and not the date as per the bill of lading.

Dy. CIT vs. Vallabh Metal Inc., ITA No. 2564/M/09, BCAJ P. 33, Vol. 41 B Part 4, January 2010

Assessee is not entitled to deduction under section 80G in respect of donation of grass fodder supplied to various cattle camps on the direction of the State Government.

Surat Electricity Co. Ltd. vs. ACIT (2010) 128 TTJ 696 (Ahd.)

Work to be undertaken by assessee included data collection measurement of dynamic properties of machines, providing training to engineers nominated by "T" Ltd., etc, it could be concluded that assessee did "make available" technical knowledge, experience, skill and know-how processes to "T" Ltd. within the meaning of paragraphs (4) of Article 13 of DTAA and therefore assessment passed by the authorities were confirmed. As regards the second project was concerned, since the role assessee was confined to merely providing independent evaluation of motorcycles prior to their launch and there was no provision for making available any technical knowledge, experience and skill, etc. to ‘T’ Ltd., no addition can be made.

TVS Motor Co. Ltd. vs. ITO (2010) 35 SOT 230 (Chennai)

Transportation of mail or cargo, etc. by the assessee in the international traffic by the aircrafts as owner / charter / lessee fell within the scope of Article 8 and therefore, profits attributable to the same cannot be taxed in India. Benefit of Article 8 cannot be denied to the assessee merely on the ground that the assessee was collecting cargo from its customer’s place and transporting the same to airport for the purpose of further transportation in the international traffic and vice versa.

ACIT vs. Federal Express Corporation (2010) 35 DTR 425 (Mum.)

Income derived from Korean company from overseas operations cannot be subjected to tax in India in view of Article 5 of DTAA between India and South Korea and since the assessee did not have PE in India its project office cannot be treated as PE.

Dy. CIT vs. Hyundai Heavy Industries Co. Ltd. (2010) 128 TTJ 4 (Del.)(UO)

Price on which a particular product is available in one country may largely vary from price prevailing in other countries due to host of factors such as climatic conditions and demand and supply factors etc. In such a situation a valid comparison could not be made between price charged by assessee from other countries with that from USA, particularly when quantity exported to USA was on wholesale basis, whereas it was on in smaller lots on retail basis to other countries. In such a situation CUP method adopted by the authorities were set as side. Assessing Officer was directed to get the ALP afresh.

Gharda Chemicals Ltd. vs. Dy. CIT (2010) 35 SOT 406 (Mum.)

As per the agreement "MC" would get same amount of royalty whether advertisement expenditure was borne by assessee or by its franchisers, it could not be said that by agreeing to bear a part of advertisement expenses which was to be borne by franchisers, there was any arrangement between assessee and MC, a non–resident, to effect that there was no profit to assessee or lesser profit to assessee, therefore section 92 was not applicable with regard to advertisement expenditure and as a consequence, thereof additions confirmed by the CIT(A) was deleted.

McDonalds (India) (P) Ltd. vs. ACIT (2010) 36 SOT 240 (Delhi)

There is no provision that the depreciation to be taken into account in all situations.

Schefenacker Motherson Ltd. vs. ITO (2010) 2 ITR 196 (Delhi)

On the facts of the assessee as no details about price at which its associate concerns had supplied raw materials to unrelated customers and thus comparison between price charged by associate concerns from unrelated buyers and price charged from assessee was not possible and assessee was not able to point out any irregularity or discrepancy in profit determined by TPO, the adjustment made by TPO in ALP was confirmed.

IL Jin Electronics (I) (P) lTD vs. ACIT (2010) 36 SOT 227 (Delhi)

Notional interest on interest-free loans can be assessed under transfer pricing law.

Perot Systems TSI vs. Dy. CIT (Delhi) Source: www.itatonline.org

When the income is exempt under the principle of mutuality, said income cannot be brought to tax under the provisions of section 115JB.

Delhi Gymkhana Club Ltd. vs. Dy. CIT (2010) 35 SOT 335 (Delhi)

Deduction claimed by assessee under section 42 cannot be considered for the purpose of computing its income under section 115JA.

Gujarat State Petroleum Corporation Ltd. vs. Jt. CIT (2010) 123 ITD 335 (Ahd.)

Capital gain is part of net profit to be prepared in accordance with the provisions of Part II of Schedule VI to the Companies Act. In the absence of any provision for exclusion of capital gains exempted under section 54EC in the computation of book profit under the provisions contained in Explanation to section 115JB, the assessee is not entitled to the exclusion thereof as claimed.

Growth Avenue Securities (P) Ltd. vs. Dy. CIT (2010) 128 TTJ 426 (Del.)

Amount credited by the assessee company to its P & L account having been withdrawn from the reserve transferred to it by another company under a scheme of arrangement which was originally created by the latter in the year 1993-94, it is deductible from the net profit for computing book profit as per Cl. (I) of Explanation to section 115JA.

Kopran Drugs Ltd. vs. ACIT (2010) 35 DTR 380 (Mum.)

Explanation to section 115JB, does not permit any adjustment with reference to deduction under section 80-IB, and therefore deduction under section 80-IB, cannot be reduced from the book profit of the assessee while computing the deduction under section 80HHC in the context of a MAT assessment.

Cello Pens & Stationery (P) Ltd. vs. ACIT (2010) 127 TTJ 723 (Ahd.)

Deduction under section 80HHC is to be computed by taking into consideration "book profit’ and cannot be restricted to the profits of the business as computed under normal provisions of the Act.

Dy. CIT vs. Glenmark Laboratories Ltd. (2010) 127 TTJ 719 (Mum.)

Editorial Note:- ACIT vs. Ajanta Pharma Ltd. (2009) 318 ITR 252 (Bombay), distinguished.

When the accounts are not prepared in accordance with Part II of Schedule VI to the Companies Act, the Assessing Officer has power to go beyond the book profit as per audited accounts. Therefore, profit on sale of rights in premises having not been routed through P & L A/c the Assessing Officer was justified in re-working the book profit in the manner provided by Part II of Schedule VI.

Dy. CIT vs. Bombay Diamond Co. Ltd. (2010) 33 DTR 59 (Mum.)

It was held that even though the word ‘Suo moto’ were inserted in the proviso to section 142(2c) w.e.f. from 1-4-2008 vide CBDT’s Circular No.1 dated 27-3-2008, the Assessing Officer did not have inherent powers to extend time limit for audit without an application from the assessee.

Bishan Saroop Ram vs. Dy. CIT (2010) 35 SOT 240 (Delhi)

It is an irregularity in directing Special Audit without affording any opportunity to the assessee and not illegality. Assessment without affording any opportunity as such could not be annulled but require to be restored to the file of the Assessing Officer with a direction to frame a fresh assessment order after affording a reasonable opportunity being heard.

ACIT vs. Sushila Milk Specialties P. Ltd. (2010) 122 ITD 48 (Delhi)(SB)

(i) In view of the judgment of the Supreme Court in case of Sahara India (Firm) vs. CIT [reported in 300 ITR 403] an order passed directing to get accounts audited under section 142(2A) without affording any opportunity entails civil consequences and therefore, rule of audi alteram is required to be observed before passing any order under section 142(2A).

(ii) In view of the judgment in case of Sahara India (Firm) (supra) it was held that the said rule of audi alteram partem would apply prospectively i.e. from the date of the said judgment of the Supreme Court i.e. 11-4-2004

Rajesh Kumar vs. Dy. CIT (2010) 122 ITD 395 (Delhi)

ITO, Pune issued a notice under section 142(1) to the assesee calling for a return of income. Assessee explained that he was assessed to tax and return was regularly filed in Wd 3(2), Thane. ITO, Pune however, without considering the assessees reply made an assessment under section 144. It was held that order passed by ITO, Pune is null and void as he had no jurisdiction over the assessee. ITO Pune had no jurisdiction even to issue notice under section 142(1). Also, assessment completed under section 144 without a notice under section 143(2) was null and void.

Pravin Balubhai Zala vs. ITO (2010) 36 DTR 290 (Mum.)

Merely on the basis of document recovered from search bearing no signature of assessee or borrower addition cannot be made.

Anil Kumar Bhatia vs. ACIT (2010) 1 ITR 484 (Delhi)

Where the Assessing Officer has collected evidence behind the back of assessee and did not disclose the evidence on which he has relied and opportunity to cross examination was not allowed to assessee, the assessment order is against the principles of natural justice and cannot be sustained.

Tourism Finance Corp. of India vs. Jt. CIT (2010) 128 TTJ 43 (Del.)

Directions issued by the Joint Commissioner are binding on the Assessing Officer. However, before issuing the directions which are prejudicial to the Assessee, an opportunity be allowed to Assessee, and also the directions issued cannot be on the lines on which an investigation be conducted.

Viswams vs. ACIT (2010) 186 Taxman 25 (Chennai)

Valuation of inventory in accordance with the method of accounting regularly followed. Assessee justified in valuing three years old inventory at nil value.

Central Electronics Ltd vs. AO, ITA Nos. 233 and 1821/Del. Of 2009 BCAJ P. 35, Vol. 41 B Part 4, January 2010

The notice was served only by affixture without attempting to serve notice on the assessee and there was not any noting in the record by the Assessing officer that the assessee had refused to accept the notice through affixture. The Assessing officer has not served the notice on the assessee in compliance with the provisions of Order 5 rule 20 of the Code of Civil Procedure, 1908, hence reassessment is bad in law. On the facts the notice was issued in March, 2003 and approval was obtained in October 2003.

Dy. CIT vs. K. C. Singhania (2010)1 ITR 205 (Amritsar)

On the basis of definite information that a certain bank account in the bank in the name of the assessee was used to provide accommodation entries, the Assessing Officer had a prime facie belief that assessee’s income had escaped assessment and therefore reopening was sustainable.

Rishi Grover vs. ACIT (2010) 33 DTR 309 (Asr.)

Assessee having not claimed deduction under section 80HHC, in its return because it had only income from other sources and no business income, claim made in the revised return by filing audit report under section 147 due to disallowances under section 43B is upheld.

ITO vs. Tamil Nadu Minerals Ltd. (2010) 128 TTJ 386 (Chennai)(TM)

Reassessment proceedings initiated on the basis of specific information that Assessee had not offered to tax, the enhanced compensation received with Interest was held to be justified. Further it was held that even though quantum of enhanced compensation which was disputed in Appeal, and though pending before Supreme Court, the same would be assessed in the year in which amount has been received.

Jagpal Singh vs. ITO (2010) 186 Taxman 26 (Delhi)

The Assessing Officer was not competent to reassess the cases prior to the assessment year beginning on or before 1-4-2001. The proviso absolutely excluded the reassessment jurisdiction of the assessing officer, in respect of the specified assessment years, mentioned therein.

Jt. CIT vs. Bombay Dyeing Mfg. Co. Ltd. (2010) 123 ITD 1 (Mum.)

Record maintained by a person for his own purpose though referable to the assessee cannot be said to be belonging to the assessee within the meaning of section 153C. Where none of the assessments are pending on the date of action under section 153C, such assessments do not abate.

Meghmani Organics Ltd. vs. Dy. CIT (2010) 36 DTR 187 (Ahd.)

Section 153A does not authorize de novo assessment. Non-pending assessments do not abate. Additions must be confined to search material.

Anil Kumar Bhatia vs. ACIT (2010) 1ITR 484 (Delhi)(Trib.)

Computerised books of account not found at the time of search, but produced at the time of assessment cannot be ignored.

Amount credited in the bank accounts of wife and son cannot be treated as undisclosed income of the assessee.

Whisky bottles received by the assessee in appreciation of good work as gifts cannot be assessed as income from undisclosed source.

G. G. Dhir (Dr.) vs. ACIT (2010) 35 DTR 81 (Agra)(TM)

Statements recorded of third parties which have been relied upon by the Assessing Officer for the purpose of assessment not having been provided to the assessee, order of Assessing Officer is bad in law to that extent. Impugned order is set aside and the Assessing Officer is directed to re do the assessment according to law by providing the said statement to the assessee as well as record satisfaction under section 158BD.

Hamish Engineering Industries (P) Ltd. vs. Dy. CIT (2010) 34 DTR 490 (Mum.)

Merely because the assessee has withdrawn the appeal against addition in quantum, in the absence of any discussion whatsoever in the penalty order to suggest any independent appraisal of additions or documents has been done in the penalty proceedings levy of penalty is liable to be deleted.

Nemchand Jain & Sons vs. Dy. CIT (2010) 33 DTR 178 (Kol.)

Special Audit Report under section 142(2A) was directed to be obtained within 60 days because the financial statements were required to be prepared from two sets of accounts and other material involving huge unaccounted transactions. The Assessee despite of repeated requests of auditors neither produced books of account and vouchers nor afforded necessary facilities to get audit work completed within the extended stipulated time of 120 days. In the circumstances the Special Auditors submitted their report on the basis of limited information primarily on the basis of seized material.

On the facts and circumstances the assessing officer completed the block assessment within the extended period in view of the Clause (ii) of Explanation 1 to section 158BE read with the proviso to the said Explanation 1.

On the facts & circumstances it was held that the order passed by the Assessing Officer was not barred by limitation under the provisions of section 158BE.

Rajesh Kumar vs. Dy. CIT (2010) 122 ITD 395 (Delhi)

Employer providing composite free bus pick up and drop facility to employees, not taxable as perquisites. Value of facilities enjoyed by all employees as it is impossible of computation, computation machinery fails hence, the employer cannot be treated as assessee in default for failure to deduct tax at source.

Transwork Information Services Ltd. vs. ITO (2010) 1 ITR 58 (Mum.)

Editorial Note:– See WNS Global Services (P) Ltd. (2009) 33 SOT 445 (Mum.)

Hiring of trucks belonging to truck owners without man power i.e. drivers and conductors, cannot be said to be carrying on any work as used in section 194C, and as such no tax was deductible from payments made to truck owners.

Dy. CIT vs. Satish Aggarwal & Co. (2010) 122 ITD 35 (Asr.)

Assessee taking vehicles on hire for purpose of executing contract, not a case of sub-contract, tax need not be deducted at source.

Mythri Trnasport Corporation vs. ACIT (2010) 1 ITR 290 (Visakhapatnam)

Where a hospital engaged consulting doctors and provided them with chambers with secretaries assistance and fee collected from outpatients and paid to consultants each day after deducting certain amount towards rent and secretarial assistance, it was not a case of payment of professional fees and neither section 192, nor section 194J was attracted and the hospital cannot be treated as assessee in default for not deducting tax from such payments.

ACIT vs. Indraprastha Medical Corp. Ltd. (2010) 128 TTJ 500 (Delhi)

Payment of uplinking charges by assessee to parent company not in the nature of fees for technical services hence not liable to deduction of tax at source.

Reimbursement of expenditure incurred in respect of Global accounts manager cannot be treated as payment of salary. Similarly reimbursement of common expenses incurred of parent company for benefit of group concerns not liable for deduction of tax at source.

Expeditors International (India) P. Ltd (2010) 2 ITR 153 (Delhi)

Margin earned by the assessee company on supply of prepaid SIM cards and recharge coupons etc. was in the nature of commission and therefore the assessee service provider is liable to deduct tax at source under section 194H.

Vodafone Essar Celluar Ltd. vs. ACIT (2010) 35 DTR 393 (Coch.)

Payment made to Stock exchange for providing infrastructure to their members is not in the nature of technical services to attract provisions of section 194J.

Dy. CIT vs. Angel Broking Ltd. (2010) 35 SOT 457 (Mum.)

Editorial Note: See Kotak Securities Ltd. vs. Addl. CIT (2009) 24 DTR 214 (Mum.)

Assessee trust whose beneficiaries and trustees being ex-employees of the company, is not liable to deduct TDS under section 194A, in respect of sums credited to members account, as the status being Individual, provisions of section 194A are not applicable.

NTPC Ltd. Employees Provident Fund Trust vs. ITO (2010) 186 Taxman 13 (Delhi)

Payments to non-resident for hire of transponders is royalty, tax has to be deducted at source.

Asianet Communications Ltd. vs. Dy. CIT (2010) 1 ITR 683 (Chennai)

Reimbursement of expenses incurred on travel not involving element of income not taxable. Various sites cannot be considered together when contract are not interconnected. Period to be computed separately in respect of each activity. Activity once commenced continues till completion of contract. Intervening period cannot be excluded. Period of six months to be counted irrespective of years involved.

Jt. DIT vs. Krupp Uhde GmbH (2010) 1 ITR 614 (Mum.)

Reimbursement of expenses related to fee for technical services, provisions of section 195 would be applicable, however, in view of fact that all services had been provided by "L", off shore, assessee would not incur any liability to deduct tax towards payment in respect of services.

Bovis Lend Lease (India) (P) Ltd. vs. ITO (2010) 36 SOT 166 (Bang.)

Assessee company having entered into a contract with a US company ACSC only for procuring software personnel for the projects of another foreign company in USA, the primary services rendered by ACSC to the assessee under the contract is akin to recruitment and placement service rather than making available any technology, plan, design, etc. and, therefore, the payments made to ACSC cannot come within the purview of ‘fee for included services’ within the meaning of Article 12(4)(b) of Indo-US DTAA and the same are not chargeable to tax in India and no tax was deductable at source under section 195.

ACIT vs. IIC Systems (P) Ltd. (2010) 33 DTR 422 (Hyd.)

Personnel supplied by Malaysian company were supposed to function under direction, control and supervision of assessee, therefore it could be said that there was no PE of Malaysian company in terms of Article 5 of DTAA, therefore payment received by said company was not taxable in India, consequently provisions of section 195, and 40(a)(i) could not be invoked.

Dy. CIT vs. Stock Engineer & Contractors B. V. (2010) 122 ITD 49 (Mum.)

Assessing Officer having issued certificate under section 197 for no deduction of tax at source, Assessing Officer could not subsequently treat the assessee as an assessee in default under section 201.

Bovis Lend Lease (India) (P) Ltd. vs. ITO (2010) 127 TTJ 25 (Bang.)(UO)

There cannot be any interest liability under section 234B or 234C, for the non–resident assessee where all payments received from Indian source are subject to TDS.

Cable News Nerwork LP. LLLP vs. ADIR (2010) 36 DTR 233 (Del.)

Income subject to tax deduction at source, interest cannot be charged u/s. 234B

Jt. DIT vs. Krup Uhde GmbH (2010) 1 ITR 614 (Mum.)(Trib.)

Interest granted by the department to the assessee under section 244A of the Act, had to be taxed in the year of receipt.

Dy. CIT vs. Seshasayee Paper and Boards Ltd. (2010) 2 ITR 417 (Chennai)

Ruling of Authority for Advance Rulings is binding on the assessee and the assessee cannot agitate on those aspects.

Mustaq Ahmed vs. ADIT (2010) 2 ITR 315 (Chennai)

Tribunal has no power to examine validity of search in an appeal against block assessment i.e. validity of search warrant.

CIT vs. Chika Vyankatesh Sidram (2010) 1 ITR 369 (Pune) / (2010) 122 ITD 293 (Pune)

Respondent can support the order of CIT(A) by taking any ground, though no cross objection had been filed.

Cable News Network LP LLLP vs. Asst Director (2010) 36 DTR 233 (Del.)

Editorial Note:– See Traice, Source: www.itatonline.org

Tribunal having taken a conscious decision in the order passed on the first Miscellaneous Application that its conclusion in the original order was not based on erroneous facts /and or misappreciation of facts on record that no legal contention going to the root of the matter remained to be considered, second Miscellaneous Application is not maintainable on the same set of facts.

Kailashnath Malhotra vs. Jt. CIT (2010) 36 DTR 1 (Mum.)(TM)

Appellant can raise an additional legal ground for first time before Tribunal by obtaining leave of Tribunal and affected party must be given an opportunity of being heard.

ITO vs. M. M. Textiles (2010) 122 ITD 435 (Mum.)

Assessee’s prayer for admission, of additional ground cannot be rejected on the hypertechnical ground that the specific space provided to mention the actual additional ground on page 2 of the petition was left blank by oversight.

Everwin Export Corporation vs. ITO (2010) 128 TTJ 19 (Chennai)(TM) / (2010 ) 34 DTR 256 (Chennai)(TM)(Trib.)

Capital Gains being assessable in asst year 2002-03 direction is given to the Assessing Officer to give credit for the tax already paid by the assessee on this very income in the later years as such direction is necessary for disposal of the appeal.

Dy. CIT vs. Standard Fire Works (P) Ltd. (2010) 34 DTR 270 (Chennai)(TM)

When first Miscellaneous Application is rejected, second Miscellaneous Application is not maintainable.

Hexa Securities & Finance Co. Ltd. vs. ITO (2010) 127 TTJ 510 (Delhi)

Tribunal can stay the proceedings before the Assessing Officer in exercise of its inherent powers as well as in view of the proviso to section 254(2A). The Tribunal disposed the stay application by directing the Assessing Officer to pass the assessment order by 31-12-2009 in accordance with the law but not to serve on the assessee, and thus not to give effect to the same for a period of a six months from the date of passing of its order or till date of passing of the appellate order, whichever is earlier.

Pancard Clubs Ltd. vs. Dy. CIT Stay No. 235/2009 dt. 18-12-2009 Bench C (BCAJ March, 2010 14. 642 (2010) 41–BCAJ)

A request made at the time of hearing, which has not been dealt with in the order of the Tribunal, constitutes an error in the order. The action of the Tribunal in setting aside the order of CIT(A) and upholding the action of the AO in a case where the CIT(A) has not adjudicated on the specific grounds raised by the assessee and also on the alternate grounds raised, constitutes a mistake apparent on record.

Puja Agencies Pvt. Ltd. vs ACIT, BCAJ P. 17, Vol.41-B, Part 6, March 2010.

Assessing Officer having accepted the annual value of the property on the basis of the actual rent received by the assessee for the property from a group concern which was admittedly less than the annual value fixed by the Corporation, CIT was justified in setting aside the assessment order on this issue and giving appropriate direction to the Assessing Officer to examine the issue from all angles.

Sical Logistics Ltd. vs. Addl. CIT (2010) 34 DTR 350 (Chennai)(TM)

As per Explanation to section 263(1), the power of revision extends to the assessment orders passed on basis of directions issued by Joint Commissioner under section 144A.

Viswams vs. ACIT (2010) 186 Taxman 25 (Chennai)

The issue whether the expenditure is capital or revenue in nature is always a debatable issue and the Assessing Officer follows one of the possible views then the CIT has no jurisdiction to revise the assessment under section 263.

Flextronic Software System Ltd. vs. CIT (2010) 128 TTJ 107 (Del.)

Sales made outside books and not disclosed in original return, no bona fide explanation. Documents related to undisclosed sales found during search, -Explanation I to section 271(1)(c) is applicable.

For immunity from penalty specific requirement of declaration of additional income in return. Penalty is leviable on difference of income declared in return filed under section 153A, and original return.

Dy. CIT vs. K. Natarajan (2010) 2 ITR 273 (Bang.)(Trib.) / (2010) 128 TTJ 558 (Bang.)

Assessing Officer made addition on the basis surrender made by the assessee and did not issue summons to the lenders to prove that there was concealment of income he was not justified in imposing penalty on the surrendered income.

Raja Rani MIttal vs. ITO (2010) 36 SOT 4 (Delhi)

Assessee having admittedly disclosed complete details of its claim for deduction under section 80HHC in its return, and the Assessing Officer having disallowed the claim on the basis of a ruling of the Supreme Court which was pronounced much after the date of the filing of return by the assessee, the claim cannot be said to be false and, therefore, no penalty under section 271(1)(c) is leviable.

Dy. CIT vs. Maharashtra Seamless Ltd. (2010) 36 DTR 36 (Del.)

Where assessee is absent from his residence at time when service of notice is sought to be effected on him and there is no likelihood of his being found at his residence within reasonable time and he has no agent empowered to accept service of notice on his behalf, service of a notice can be made on any member of assessee’s family residing with him, whether male or female.

ITO vs. Gurbax Singh Gill (2010) 123 ITD 226 (Asr.