I.  Today's Headlines:    

II.  Direct Tax Case laws:

1.  Shikshana Prasaraka Mandali Vs. CIT, Writ Petition No. 2634 of 2012, Date of Pronouncement: 05-03-2013, Bombay High Court

Section 127 of the Income Tax Act, 1961

Whether it is required under law to specify the reason for transfer of Assessee’s case from one department to another and grant personal hearing before passing order u/s 127(2) of the Income Tax Act, 1961.

Held: Yes

The Petitioners case was centralized with another Officer for the purpose of administrative convenience and coordinated investigation. However, the Show cause notice issued for the same lacked on the principle of Audi Alteram Partem. It was held that unless the assessee is informed of the reasons for the proposed action, it would be impossible for him to put forth his point of view with regard to the reasons for the proposed action. Thus, it is mandatory on the part of Revenue to grant personal hearing before passing an order u/s 127(2) of the Act. Merely because the Petitioner had not specifically asked for a personal hearing it will not absolve the revenue of its obligation to ordinarily grant such a hearing.

(Please click here for judgment)

2.  M/s Bharti Hexacom Limited Vs. CIT, ITA No. 2576/Del/2011, Date of Pronouncement: 04/01/2013, ITAT - Delhi

Section 263 of the Income Tax Act, 1961

Whether the Commissioner can exercise his revisional jurisdiction u/s 263, where the AO failed to make enquiry during assessment proceedings in respect of payments liable to TDS.

Held: Yes

AO has not made any discussion regarding the subjects raised by the Ld. CIT u/s. 263 and the AO has mechanically accepted what the assessee wanted him to accept without any application of mind or enquiry. Further, no evidence had been placed that the claim made by assessee was objectively examined or considered by the AO either on record or in the assessment order.  Therefore, it was a fit case for the Commissioner to exercise his revisional jurisdiction u/s 263 which he rightly exercised by cancelling the assessment order and directing the AO to pass a fresh order.

(Please click here for judgment)

III. A Useful Article:

[ Contribution by CA Madhukar Hiregange, Former CC Member and contributor is available at mhiregange@hotmail.com ]

VCES- Background material

The Voluntary Compliance Encouragement Scheme (VCES) filing maybe a good professional activity which can include the review of the various streams of income/ applicability of reverse/ joint charge, an opportunity to recover the amount of ST from the client [ no interest/ penalty] - all in all a great opportunity for professionals to provide good quality services.

(Please click here)   

 Golden Rules:

"Confidence never comes
if we have all the answers,
but it comes when we are ready for
All the questions"

  Thanks & Regards

Team

Voice of CA