Recent Case Laws (DT) for CA May 2010 Exam

Chargeability of Enhanced compensation and interest thereon under Land Acquisition Act are taxable in year of receipt

Where letting/leasing out of property was part of business object of a concern/person, rental income would be treated as 'business income'

Where standard warranty was required to be given during sell and assessee made provision for warranty which exceeded actual expenditure and excess amount was reversed, claim for deduction under section 37 of said excess amount could not be denied

Higher rate of depreciation is also admissible when the motor lorry is used by the assesses in his own business of transportation of goods on hire.

An expenditure can be treated as revenue expenditure, if the expenditure is in respect of an ongoing business of the assessee and there is no enduring benefit.

Profits chargeable to tax Taxability of balancing charge of items costed less than Rs. 5,000 prior to and after amendment by Finance Act (No. 2) Act, 1995 with effect from 1-4-1995

Revenue can make addition under Section 68 only if the assessee is unable to explain the credits appearing in its books of accounts.

Principal incorporated in Section 27 of the General Clause Act, 1897 can profitably be imported in a case where the sender has dispatched the notice by post with the correct address on it

It is not mandate of section 132 or any other provision in Act that reasonable belief recorded by designated authority before issuing warrant of authorisation must be disclosed to assessee

Where there was no new material in hands of Revenue leading to view that there was reason to believe that income had escaped assessment, instead, case was a classic instance of a change of opinion, notice under Section 148 was to be quashed.

Assessing Officer should pass an independent order of assessment and Commissioner or other higher authority may have supervisory jurisdiction, but they cannot interfere with functions of Assessing Officer

CIT -vs.- Greenworld Corporationm (SC)

Section 50 C has application only to the extent of determining sale consideration for computation of capital gain and it cannot be applied for determining the income under other heads.

Interest earned on funds primarily brought for infusion in the business could not have been classified as income from other sources

Various services rendered by a hotel to its customers would be outside the purview of Section 194C

Apportionment of tax deducted at source, is to be in the same proportion, as the income earned by the parties (sharing the fruits of the common investment)

If there is no proceeding before appropriate authority or if assessment year in question is also not a matter, which would fall for consideration before higher authority, section 150 of the Act will have no application

Once spares are considered as emergency spares, assessee can seek capitalization and depreciation

Depreciation to certain expenditure relatable to the plant and machinery is allowable. Corporate Membership paid by the assessee is allowable

Provision for a liability is amenable to a deduction if there is an element of certainty

An order of Assessing Officer can be interfered suo motu by Commissioner not only when an order passed by Assessing Officer is erroneous but also when it is prejudicial to interests of Revenue; Both conditions precedent for exercising jurisdiction under section 263 are conjunctive and not disjunctive

CIT -vs.- Greenworld Corporationm (SC)

Bottling fees chargeable from assessee under Rules framed under Rajasthan Excise Act, 1950 and interest chargeable on late payment of bottling fees, would not amount to tax, duty, cess or fees and such fees are not covered by section 43B.

Furnishing of bank-guarantee is not same as making actual payment as required under section 43B