I.  What's New of the day : 

1. Release of Dos & Don'ts Manual (covering various aspects of General Conduct, Financial administration, Tax administration and Vigilance Administration etc) by Chairman , CBDT (Click for detail)

2. Master Circular No. 1/2011 - Master Circular on Prosecution of Directors  (Click for detail) 

3. HDFC Bank starts income tax payment service through ATMs  (Click for detail) 

4. RBI/2011-12/ 136 - Comprehensive Guidelines on Derivatives: Modifications  (Click for detail)

5. RBI/2011-12/ 138 - Exim Bank's Line of Credit of USD 4 million to the Government of the Co-operative Republic of Guyana  (Click for detail)

6. High Court Says Casual Workers Not Entitled to Equal Pay for Equal Work  (Click for detail)

7. Alternative Funds To Fall Under SEBI  (Click for detail)
   
     

   III.  Judicial Pronouncement 

   1.   ASHOK CHADDHA  Vs.  INCOME TAX OFFICER,  ITA No. 271/2011, HIGH COURT OF DELHI, Dated : July 27, 2011

   Whether the issue of notice under Section 143(2) of the Income Tax Act is mandatory for finalization of assessment under Section 153A?

   There is no specific provision in the Act requiring the assessment made under section 153A to be after issue of notice under section 143(2) of the Act. Learned counsel for the assessee places heavy reliance on the judgment of the Hon‟ble Supreme Court in Hotel Blue Moon v. DCIT, (Supra) wherein it was held that the where an assessment has to be completed under section 143(3) read with section 158BC, notice under section 143 (2) must be issued and omission to do so cannot be a procedural irregularity and the same is not curable. It is to be noted that the above said judgment was in the context of Section 158BC. Clause (b) of Section 158BC expressly provides that “the AO shall proceed to determine the undisclosed income of the block period in the manner laid down in section 158BB and the provisions of Section 142, sub sections (2) and (3) of Section 143, Section 144 and Section 145 shall, so far as may be, apply. This is not the position under section 153A.

   The law laid down in Hotel Blue Moon, is thus not applicable to the facts of the present case. The issue of requirement of notice under section 143(2) for an assessment under section 147 came up for consideration before this court recently in CIT v. Madhya Bharat Energy Corpn., ITA No. 950/08 decided on 11-07-2011. In that case also, this court has held that in the absence of any specific provision under Section 147 of the Act, the issuance of notice under Section 143 (2) cannot be held to be a mandatory requirement.

   (Please click here for judgment)

     

   2.  The Commissioner of Income Tax  Vs.  Shri Madeshwaran M. Vannier,  ITA No. 456 OF 2011, HIGH COURT OF BOMBAY, Dated : 27TH JULY, 2011

   Section 271D of the Income Tax Act, 1961 is the question raised in this appeal. 2. In the present case, the assessee with a view to purchase a house obtained loan totaling to Rs.25,22,000/- from the close relatives such as Father, Mother, Sister-in-law, Mother's Brother etc. In the affidavit filed by these relatives, it was stated that they had income from agricultural operations and that loan was advanced to the assessee out of the agricultural income received by them. The Tribunal considered that failure to accept such loans in violation of section 269SS of the Act constituted reasonable cause and therefore it was not a fit case for imposition of penalty under  section 271D of the Income Tax Act, 1961. 3. In our opinion, the decision of the ITAT cannot be said to be perverse. Accordingly, appeal is dismissed with no order as to costs.

   (Please click here for judgment)

     
    

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