Status of Pending Income Tax Refunds

Dear All

You can find your Income Tax Refund details in the link below:

https://tin.tin.nsdl.com/oltas/refundstatuslogin.html

Exemption to Charitable Institution u/s 12A

On the basis of Non filing of auditors report u/s 10B, exemption cannot be denied.

Sir Kikabhai Pemchand Trust (Mumbai) ITA/ 5308/ Mum/2009

Revision u/s 263 by Commissioner

Where AO adopts one of the possible view permissible in law or where two views are possible and AO takes one of the possible views , commissioner cannot exercise his power u/s 263 to differ with view of AO even if there is a loss of revenue.

Honda Siel Power Products Ltd. ( Delhi ) 194 Taxman 175

Assessment Proceesing : Addition on account of Guess Work

Supreme Court in Dhakeshwari Cotton Mills 26 ITR 775 had given a priciple that in making the assessment ITO is not entitled to make pure guess and make an assessment without return or any evidence or material.

DTAA : India - UK - Dividend Income

If an assessee i.e. Resident of India, desires to get the tax credit in respect of dividend income from a UK company available as per UK law, then he will be treated at par with resident of UK and amount received by assessee would then be deemed to increase by 1/9th of dividend received from UK company for purpose of taxation under Indian Income Tax Act and tax credit can only be adjusted against his tax liability in India but he cannot claim refund, if any, in case his credit is more than his tax liability.

Homy N. J. Dady (Mumbai ITAT)

Service Tax on Renting of Immovable Property : Retrospective amendment and constitutional validity : UPHELD

The Punjab and Haryana High Court has upheld the Constitutional validity and retrospective levy of service tax on renting of immovable property.

The levy of service tax on renting was challenged by Shubh Timb Steels Ltd, owning commercial property in Himachal Pradesh, on the issue of Constitutional validity and also validity of the retrospective amendment. On both these points, the court ruled in favour of the government. The court observed that it could not be held that renting of immovable property did not involve any service, as a service could only be in relation to property and not be renting of property. It said renting for commercial purposes is a service and has a value for a service receiver.

Section 14A disallowance on Dividend Income

Disallowance should be restricted to 1% of Dividend Income.

Hon'ble Kolkata tribunal in case of M/s BPS securities (p) Ltd. had held that Disallowance u/s 14A should be restricted to 1% of total Dividend Income.
One Important thing i would like to mention here that the decision of Kolkata Tribunal is come after the Bombay High Court decision in case of Godrej & Boyce.

Not Following Juridictional High Court Decision : Contemt of Court

Bombay High Court in Garware polyster held that Failure to follow High Court’s order is contempt of court. The AO passed an assessment order in which he declined to follow the judgement of the Bombay High Court. On a Writ Petition filed by the assessee, the High Court has taken the view that as the said judgement in Pee Vee Textiles is not stayed, “the refusal to follow and implement the judgment of this Court by Mr.Dubey in our considered view prima facie amounts to contempt of this Court”. The Court directed issue of a show-cause notice to the AO as to why action under the Contempt of Courts Act should not be initiated against him.

Domestic transactions will come under Indian Transfer Pricing provisions

Recently the Supreme Court , in the case of Glaxo Smithkline Asia (P) Ltd. has observed that amendment would be required to the provisions of the Indian Income-tax Act, 1961 (the Act) in case the Indian Transfer Pricing regulations are sought to be applied to domestic transactions between related parties under Section 40A(2) and Section 80I(A) of the Act. Towards this end, the Supreme Court has suggested that the Ministry of Finance may consider this issue expeditiously and in the interim, the Central Board of Direct Taxes may consider issuing appropriate instructions in this regard.

Stay on Retrospective Amendment : Renting of Immovable property :

Allahabad High Court in M/S Orient Craft Limited vs Union Of India And Others - granted stay on the retrospective operation (Retrospective amendment w.e.f. 1.6.2007 vide Finance Act, 2010)  of levy of service tax on renting of property but not stay on prospective levy.

Levy of Interest u/s 234B & 234C under MAT

Whether Interst u/s 234B & 234C will be levied, when tax liability calculated u/s 115JB i.e.under MAT, is a very controversial issue. Different High Court give contradictory judgement on this issue. However, a recent Bombay High Court decision in case of Natural Gems Limited, made it quite clear that no interest u/s 234B & 234C will be levied, when tax payable under MAT. Bombay High Court had relied on SC judgement in Kwality Biscuits, which gives the principle that book profit will be calculated only after end of the financial year, hence it is not possible to estimate tax liability.
Logically, this Bombay High Court seems to be prevail in near future as principle given by SC is still prevailed.