I. Today's Headlines:    

1. Land Acquisition Act effective from January 1, 2014 (Click here for details)

2.  Bank branch expansion at a decade's high. (Click here for details)

3. CBDT on Safe Harbour Rules - (Click here for details) 

II.  Direct Tax Case laws:

 
1. MDLR Resorts (P.) Ltd. v. Commissioner of Income-tax, WP(C) NOS. 693 OF 2013 & OTHERS, DATE OF ORDER : DECEMBER  20, 2013 , HIGH COURT OF DELHI

Whether defects in panchnamas affect validity of search

Held No

The expression 'panchnama' has not been defined in the Act. Section 132(13) makes provisions of Code of Criminal Procedure 1971 relating to search and seizure applicable to searches under the said section. It states that Search shall be made in presence of witnesses and list of things seized during the search shall be prepared by the officers or other persons and signed by such present witnesses.
A copy of the said list prepared and duly signed by the witnesses shall be delivered to every occupant or person at the place searched, is mandated.

It is evidently clear that this document has considerable evidentiary value and should be prepared with care and caution. The panchnama should be exhaustive, record of all events in the same sequence in which they have occurred and should specify details like name of person against whom warrant was issued, time of temporary conclusion of search etc. Panchnama should be prepared even in cases where nothing is found or seized in the search.
There is certainly lapse and failure to comply with the requirements of search and seizure manual as the panchnama did not contain names of the 22 petitioners and does not record any suspension of search. Even the obstruction and presence of third persons were not mentioned in the panchnamas. But this would not affect the validity of the search. We only record that panchnamas in the present case to this extent are defective, but the search or initiation of search cannot be disputed. However, the respondents should take remedial steps and ensure that such lapses do not occur in future, otherwise similar allegations will get repeated, entailing litigation.

(Please click here to view the Judgment)

2. Commissioner Of Income Tax (Central), Kanpur vs. M/S Sahara India Mutual Benefit Co. Ltd.,Lucknow, INCOME TAX APPEAL No. - 184 of 2005, Date of Order : 09.10.2013

Whether addition made by Assessing Officer of notional interest which was not in existence is correct.

Held No

Needless to mention that yardstick will have to be applied from the businessman's point of view and certainly not according to the Assessing Officer, as per the ratio laid down in the case of Voltamp Transformers (P.) Ltd. v. CIT [1981] 129 ITR 105CIT v. Walchand & Co. (P.) Ltd. [1967] 65 ITR 381 (SC). It is only the assessee, who knows the commercial and business relations and the situation thereof and department is not supposed to interfere as per the ratio laid down in the case of Sri Kewal Chand Bagri v. CIT [1990] 183 ITR 207. The addition was made by the Assessing Officer on notional interest which was not in the existence.

(Please click here to view the Judgment)
   

 Useful Link:

 "Book on Stress Management, Contribution by CA Prakash Agarwal (Please click here to view) "

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"The professional has learned that success, like happiness, comes as a by-product of work. The professional concentrates on the work and allows rewards to come or not come, whatever they like.”

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