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15.10.2011 - Recent Updates as on 15.10.2011
Saturday, October 15, 2011

 

I.  Today's Topline News : 
  1. MCA Notice: On request from PI(ICSI, ICAI & ICWAI), Ministry has re-opened registration of Certified Filing Centres from 1st October for two months  (Click for detail)

  2. Helpline for November, 2011 CA Examinations  (Click for detail)

  3. Value-added tax to be levied on sugar, textiles from April  (Click for detail)
     

II.  Recent Updates:

1.    ACIT vs. M/s Punjab State Coop & Marketing Fed.Ltd., ITA No.548/Chd/2011 & ITA No.579/Chd/2011 (ITAT- Chd. Bench)

Held where there is nothing to indicate that investment in purchase of shares was made out of borrowed funds, no disallowance was warranted u/s 14A of the Income Tax Act. Further , S. 14A disallowance cannot exceed exempt income.

(Please click here for order)

  

2.  BENNETT COLEMAN & CO. LTD. Vs. THE ADDL. COMMISSIONER OF I.T., I.T.A.NO. 3013/MUM/2007 – A.Y 2002-03, DATE OF PRONOUNCEMENT: 30-09-2011, ITAT – MUMBAI

Loss on pro-rata reduction of share capital is “Notional”. In absence of consideration, capital gains provisions do not apply

(i) First the face value of each share was reduced from Rs. 10 to Rs. 5 and then two shares of Rs. 5 each were consolidated into one share of Rs. 10 each. If the argument is that earlier shares were replaced or substituted by new shares, then there is no “transfer” but it is merely a case of substitution of one kind of share with another kind of share.

(ii) Assuming that a reduction of shares in the manner done by the assessee amounts to a “transfer”, s. 45 is not attracted because there is no “consideration” received by the assessee for the transfer. Unless and until a particular transaction leads to “computation” of capital gains or loss as contemplated by s. 45 & 48, it cannot attract capital gain tax.

(iii) Further, by the reduction, the assessee’s rights had not been extinguished because it continued to hold the same percentage in the holding of Times Guarentee as it did before the reduction. There was no change in the intrinsic value of his shares and even his rights vis-à-vis other shareholders as well as vis-à-vis company remained the same.

(Please click here for judgment)

  

3.   COMMISSIONER OF INCOME TAX, KOLKATA-III Vs. M/S DATAWARE PRIVATE LIMITED, ITAT NO. 263 OF 2011, DATE : 21ST SEPTEMBER, 2011, HIGH COURT AT CALCUTTA

In our opinion, in such circumstances, the Assessing officer of the assessee cannot take the burden of assessing the profit and loss account of the creditor when admittedly the creditor himself is an income tax assessee. After getting the PAN number and getting the information that the creditor is assessed under the Act, the Assessing officer should enquire from the Assessing Officer of the creditor as to the genuineness of the transaction and whether such transaction has been accepted by the Assessing officer of the creditor but instead of adopting such course, the Assessing officer himself could not enter into the return of the creditor and brand the same as unworthy of credence. So long it is not established that the return submitted by the creditor has been rejected by its Assessing Officer, the Assessing officer of the assessee is bound to accept the same as genuine when the identity of the creditor and the genuineness of transaction through account payee cheque has been established.

(Please click here for judgment)

  

III.  Today's Bottomline News : 

  1. Taxmen to bank on high profit segments to meet target  (Click for detail)

  2. Commodity, bullion trade to come under the I-T radar  (Click for detail)

  3. Mahindra Satyam can deposit nominee directors' salaries in Treasury: CLB  (Click for detail)

  4. Buying Home Insurance? Check Exclusions First - Claims can be rejected if a house was vacant for over 30 days  (Click for detail)
     

IV.  Today's Tenders Info. :

  1. FOOD CORPORATION OF INIDIA
    NOIDA
    (CLICK FOR DETAIL)

Key of Success :

"Poor  People Walk Miles & Miles to earn  Food
&
Rich People Walk Miles & Miles to Digest Food
Strange But True!
"

  

Thanks for your valuable time

   

"Voice of CA"  

  
CA. Sanjay Kumar Agarwal
Founder - Voice of CA 
Mob : 9811080342,
agarwal.s.ca@gmail.com      
   
CA. Sidharth Jain, Co-Moderator
sidhjasso@yahoo.com 
  
CA. Mukesh K Bansal, Co-Moderator-FEMA 
mukbansal80@gmail.com    

 

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