| Wednesday, May 18, 2011 |
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1. COMMISSIONER OF INCOME TAX, JABALPUR Vs M/s VINDHYA TELELINKS LTD, ITR No.192/1997, Date of Order: February 22, 2011, HIGH COURT OF MADHYA PRADESH Whether, if assessee gives certain amount as advance towards purchase of machinery but the machinery is not installed during the year, even then deduction u/s 32AB cannot be denied. When the Parliament inserts Section 32AB in the Income Tax Act, it meets out the contingency where the assessee deposits any amount for the purchase of any new machinery, then the assessee was allowed deduction of the amount. The language used in Section 32AB is very specific which provides that such amount must have been utilized for the purchase of any new machinery. When the statute itself provides such, which is entirely different from the provision as contained in Section 32A, natural inference is that the intention of the Legislature was to meet out such situation when such amount was not invested for the purchase of plant but it was deposited with the manufacturer for the purchase of new machinery. (Please click here for judgment)
2. TECH NOVA IMAGING SYSTEMS (P) LTD Vs ASSISTANT COMMISSIONER OF INCOME TAX, ITA Nos.5514/Mum/2007, A.Y.: 2002-2003, Dated: April 8, 2011, ITAT – Mumbai Whether when the assessee has not incurred any expenditure in relation to earning exempted income, the CIT (A) is right in disallowing 1% of the expenses observing the same as incurred for administration of transactions on which exempted income was earned. Held Yes. (Please click here for judgment)
3. [Contribution by P.C.Yadav, Advocate - Supreme Court of India] Commissioner of Income Tax Vs M/s Perfect Communication ITR No. 564 of 2011, Date of Order: April 7, 2011, High Court of Delhi Income Tax: - Section 205, 194H: - In this matter the assessee has let out its Mumbai based property on rent to one company. The Tenant while remitting the payments of rent informing continuously that it was deducting TDS as per the provision of section 194H. The AO denied the credit of TDS while processing the return under section 143(1)(a) of the Act. As a result of which assessee enquired into and found that the deductor tenant had not deposited any TDS on his account with the Govt - CIT (A) and ITAT all in chorus denied the claim of the assessee on the ground that claim of TDS is available only when the certificate of TDS is there- Matter reached to the High Court wherein the AR of the assessee draw the attention of their Lordship towards the provisions of section 205 of the Act and argued that the revenue can not demand the amount of TDS directly from the deductee.
4. [Contribution by CA. Mukesh K Bansal, Co-Moderator - FEMA] FEMA UPDATE - FDI IN LLPS
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