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II. Direct Tax Case laws:
1. Asstt. CIT Vs. Dr. S. Balasundaram, ITA No. 1832/Mds/2012, Date of pronouncement: 27.05.2013, ITAT - Chennai
Section: 54B of Income Tax Act, 1961
Assessment Year: 2009-10
Issue 1:
Whether
benefit u/s 54B of the Act can be claimed where new agricultural land
is purchased prior to transfer of previously owned agricultural land?
Held Yes,
The
assessee cannot be deprived of benefit u/s 54B of the Act where other
conditions are fulfilled and sale & purchase of agricultural land is
not disputed by the AO even though the land has been purchased prior to
execution of sales deed. In the instant case, substantial amount of
consideration and possession were transferred before executing sale deed
and the new land was purchased with such amount.
The
intention of the Legislature is that the assessee has to use the sale
consideration for the purpose of buying agricultural land and the
contention of AO that benefit is only available for subsequent purchase
within a period of two years from sale of land was held to be only a
hyper technical objection.
Issue 2:
Whether granting relief to assessee on account of additional
evidences produced by him without giving an opportunity to the Assessing
Officer amounts to violation of Rule 46A of the Income Tax Rules.
Held Yes,
Rule 46A of the Income Tax Rules elucidates that before any
additional evidence is accepted, the other party has to be given an
opportunity of hearing. Since, in this case, opportunity of being heard
was not provided to AO for development expenses, order of CIT (A) was
set aside and remitted back the matter for re- examination.
(Please click here for judgment)
2. CIT Vs. M/s Delhi Press Patra Prakashan, ITA No. 1732/ 2006, Date of judgment 31.05.2013, Delhi High Court
Decision: In favor of assessee
Section: 80IA & 80IB of Income Tax Act, 1961
Assessment Year: 1997- 98 to 1999- 00, 2003- 04 & 2004- 05
Whether
the expenditure incurred by a unit can be reallocated to another unit
engaged in job work and claiming deduction u/s 80IA and 80IB, as the
case may be, merely because the profits were significantly higher than
profits earned by the assessee from other units.
Held : No,
In the instant case, the assessee being an industrial undertaking
engaged in the business of publication and printing of newspapers and
periodicals. The AO has reallocated the expenses incurred by a unit
engaged in publishing to a unit engaged in printing work merely on the
contention that the profits were inflated and the printing unit charged a
lower amount for the work assigned. The Hon’ble High Court held that,
since there is no material to support the view that the job work charges
charged by printing Unit were not at market rates. Thus, expenses
related to the printing work carried on by the printing unit are liable
to be deducted from the job charges to arrive at the profits eligible
for deduction under Section 80-IA or 80-IB of the Act, as the case may
be.
(Please click here for judgment)
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