Category: Income Tax

Income tax Articles, Video updates, PPT

Judicial updates-09th Feb 2022 (Income tax, GST & Corporate Laws)

Posted on by Business So Simple in Company Law, GST, Income Tax, Legal awareness

ITAT Kolkata directs service of notice to Assessee’s Lawyer via email as same could not delivered to Assessee

Massive Infrastructure Pvt. Ltd. Vs ITO (ITAT Kolkata) dated 02/02/2022

Revaluation of Land by firm after conversion of inventory into fixed asset – colourable device?

PCIT Vs Orchid Griha Nirman Pvt. Ltd. (Calcutta High Court) dated 31/01/2022

*Tribunal agreed with CIT(A) that after conversion of inventory into fixed asset the firm revalued the developed land including construction thereon in order to bring it in line with the current market value to justify the business assistance secured by the firm from the banks to extent of nearly Rs. 250 crores. Therefore, on facts the tribunal concluded that the revaluation was not a colourable.
Confirmed by HC.

Failure to issue section 143(2) notice prior to finalising reassessment order makes reassessment proceedings a nullity

ACIT Vs P & R Infraprojects Ltd. (ITAT Delhi) dated 07/01/2022

ITAT deletes Addition of Profits from Suppressed of Sales belonging to Firm of director of Appellant Company

ITO Vs Super Hospitality Services Pvt. Ltd. (ITAT Ahmedabad) dated 31/01/2022

Interest on Investment made to acquire controlling interest allowable

Gujarat Nippon Enterprises Pvt. Ltd. Vs ITO (ITAT Ahmedabad) dated 01/02/2022

ESIC & PF paid before due date of filing income tax return allowable till AY 2020-21

Dr. B. Lal Clinical Laboratory Private Limited Vs ACIT (ITAT Jaipur) dated 20/01/2022

Filing of appeal in criminal court against Civil dispute amounts to abuse of process of Court: SC

Jayahari Vs State of Kerala (Supreme Court of India) dated 25/01/2022

CIT(E) Order passed without hearing Assessee during COVID-19 violates Principal of Natural Justice

Madhavi Raksha Sankalpa Vs CIT (Exemptions) (ITAT Mumbai) dated 28/01/2022

GST Evasion Case: Accused cannot be Detained in Custody Indefinitely- SC

Paresh Nathalal Chauhan Vs State of Gujarat (Supreme Court of India) dated 01/02/2022

The Hon’ble Supreme Court of India in Paresh Nathalal Chauhan v. The State of Gujarat & Anr. [SLP (Crl) No. 009458 – 009459/2021, Criminal Appeal Nos.164-165/2022 dated February 01, 2022] granted bail to a person accused of tax evasion. Held that, assessee cannot be detained for indefinite period of time when the maximum sentence for such offence is 5 years and investigation w.r.t. the same is still pending.

GST Appellate Authority can provisionally release goods & vehicle- HC

A K Enterprise Vs State of Gujarat (Gujarat High Court) dated 03/02/2022

ITC available on GST paid under RCM on hiring of buses for transportation of employees

In re Maanicare System India Private Limited (GST AAR Maharashtra) dated 01/02/2022

Matter pending before Competent Jurisdiction cannot be transferred for mere Temporary Shift In Residence

Silpa Shaji Vs Satheesh K.S. (Kerala High Court) dated 01/02/2022

Bar of Section 69(2) of Indian Partnership Act, 1932 not applicable to Transactions not in the course of business: SC

Shiv Developers Vs Aksharay Developers (Supreme Court) dated 31/01/2022

Clarifications on allowability of expenditure under section 37 (Budget 2022)

Posted on by Business So Simple in Budget, Income Tax

Section 37 of the Act provides for allowability of revenue and non-personal expenditure (other than those failing under sections 30 to 36) laid out or expended wholly and exclusively for the purposes of business or profession.

Explanation 1 of sub section (1) of section 37 of the Act provides that if any expenditure incurred by an assessee for any purpose which is an offence or which is prohibited by law shall not be deemed to have been incurred for the purpose of business or profession and no deduction or allowance shall be made in respect of such expenditure.

However, it is s een that certain taxpayers are claiming deductions on expenditure incurred in offering certain benefits or perquisite to a person which are not intended to be allowed under this section, like meeting his expenditure related to travel, hospitality, conferen ce etc. In perquisite by these cases acceptance of such benefit or such person is in violation of a law or rule or regulation or guidelines, as the case may be, governing the conduct of such person.

In order to make the intention of the legislation clear and to make it free from any misinterpretation, it is proposed to insert another Explanation 3 to subsection (1) of section 37 to further clarify that the expression “expenditure incurred by an assessee for any purpose which is an offence or which is prohibited by law”, under Explanation 1, shall include and shall be deemed to have always included the expenditure incurred by an assessee, —

i. for any purpose which is an offence under, or which is prohibited by, any law for the time being in force, in India or outside India; or

ii. to provide any benefit or perquisite, in whatever form, to a person, whether or not carrying on a business or exercising a profession, and acceptance of such benefit or perquisite by such person is in violation of any law or rule or regulation or guidelines, as the case may be, for the time being in force, governing the conduct of such person; or

iii. to compound an offence under any law for the time being in force, in India or outside India.

‘HEALTH AND EDUCATION CESS’ NOT ALLOWED AS BUSINESS EXPENDITURE (Press release 01 Feb 2022)

Posted on by Business So Simple in Income Tax

‘Health and Education Cess’ is not allowed as business expenditure. This was clarified by Smt Nirmala Sitharaman, Union Minister of Finance while presenting the Union Budget in the Parliament today. 

The Union Finance Minister stated that the income-tax is not an allowable expenditure for computation of business income. This includes tax as well as surcharges.

The ‘Health and Education Cess’ is imposed as an additional surcharge on the taxpayer for funding specific government welfare programs, she explained.  Noting that some courts have allowed ‘Health and Education Cess’ as business expenditure, which is against the legislative intent, the Union Finance Minister reiterated that any surcharge or cess on income and profits is not allowable as business expenditure.

BUDGET 2022 (Download all budget documents) -01st Feb 2022)

Posted on by Business So Simple in Budget, Company Law, Custom, Financial Prudence, GST, ICSI, ICAI, ICMA, Income Tax, International Taxation, Legal awareness, News Desk, Public Affairs, Startups

Key to Budget Document, 2022

https://www.indiabudget.gov.in/doc/Key_to_Budget_Document_2021.pdf

Budget Highlights (Key Features)

https://www.indiabudget.gov.in/doc/bh1.pdf

Annual Financial Statement
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https://www.indiabudget.gov.in/#collapse2

Memorandum Explaining the Provisions in the Financial Bill

https://www.indiabudget.gov.in/doc/memo.pdf

Finance Bill

https://www.indiabudget.gov.in/doc/Finance_Bill.pdf

Statements of Fiscal Policy under the FRBM Act, 2003

https://www.indiabudget.gov.in/doc/frbm1.pdf

Output Outcome Framework for Schemes 2022-2023

https://www.indiabudget.gov.in/doc/OutcomeBudgetE2021_2022.pdf

Customs Notifications
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https://www.indiabudget.gov.in/#custom

Implementation of Budget Announcements 2021-2022

https://www.indiabudget.gov.in/doc/impbud2020-21.pdf

Budget at a Glance
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https://www.indiabudget.gov.in/#budget

Expenditure Profile
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https://www.indiabudget.gov.in/#expen

Expenditure Budget

https://www.indiabudget.gov.in/#expenb

Ministry wise Summary of Budget Provisions

https://www.indiabudget.gov.in/doc/eb/sumsbe.pdf

All Statements of Budget Estimates

https://www.indiabudget.gov.in/doc/eb/allsbe.pdf

Finance Minister’s Speech

https://www.indiabudget.gov.in/#collapse1

Tax updates (Budget 2022)-01 Feb 2022

Posted on by Business So Simple in Custom, GST, Income Tax, Startups

Tax updates (Budget 2022)-01 Feb 2022

AMT is proposed to be reduced from 18% to 15% for co-operative society

Surcharge rate reduced from 12% to 7% on co-operative society having total income less than Rs. 10 crores

Income from the transfer of virtual digital asset shall be taxed at 30% with no deductions of expenses

New provision introduced for filing of an updated return within 2 years from the end of the relevant assessment year on payment of additional tax

Period of incorporation for eligible start-ups to claim the tax benefit is extended by 1 year

Maximum surcharge on long-term capital gain is capped at 15%

Surcharge or cess is not allowable as business expenditure:

Gift of cryptocurrencies to be taxed at receiver’s end

The government will tax income from digital asset transfers at 30%.

Gross GST collection for January 2022 is Rs 1.4 lakh crores approx, highest since the inception of GST: Says FM

Rs 1 lakh crore financial assistance to be provided to states in 2022-23 to catalyse investments, says FM

Existing tax benefits for startups, which were offered redemption of taxes for 3 consecutive years, to be extended by 1 more year.

Faceless proceedings under Customs is fully established

Customs Duty on Gems and Diamonds reduced to 5%

SEZ reforms in customs to be implemented by 30th Sept, 2022

Concessions provided on raw material for boosting manufacturing of Electronics Goods

Duty concessions provided to high growth electronic items

Proposals made for exempting few goods under Customs for promoting manufacturing of Capital goods

Economic times –

Biggest announcements for taxpayers 👉
Taxpayers can file an updated return on payment of taxes within two years from the end of relevant assessment year.

The new provision will ensure voluntary tax filing and reduce litigation, says FM

30% tax on proceeds of virtual/digital assets with no deductions other than cost of acquisition

No set off permitted against other income

1% TDS to be levied on payments made on transfer of digital assets

Deduction for employer contribution to NPS increased to 14% from 10% earlier for State govt employees on par with central govt employees

(Economic times)

Air India strategic disinvestment completed

Posted on by Business So Simple in Income Tax

The Air India strategic disinvestment transaction has been completed today with Government receiving a consideration of Rs 2,700 crore from the Strategic Partner (M/s Talace Pvt Ltd, a wholly owned subsidiary of M/s Tata Sons Pvt Ltd), retaining debt of Rs 15,300 crore in Air India and AIXL and transferring shares of Air India (100% shares of Air India and its subsidiary AIXL and 50% shares of AISATS) to the Strategic Partner.

Description: Image

It is pertinent to mention that following Government’s approval of the highest price bid of M/s Talace Pvt Ltd for strategic disinvestment of Air India, the Letter of Intent was issued to the winning bidder on 11 October 2021. The Share Purchase Agreement (SPA) was signed on 25 October, 2021. Thereafter, Strategic Partner (M/s Talace Pvt Ltd), Air India and the Government worked towards satisfying a set of conditions precedent defined in the SPA including approvals from anti-trust bodies, regulators, lenders, third parties, etc. These conditions have since been met to mutual satisfaction.

Judicial updates (Tax Laws)- 27th Jan 2022

Posted on by Business So Simple in Court Room, GST, Income Tax, Legal awareness

Claim of Assessee of Profit lower than 8% cannot be denied for mere non-submission of Tax Audit Report

ACIT Vs Vairam Constructions (ITAT Chennai) dated 18/01/2022

Rs. 258 Crore illegal ITC availment case – HC refuses Bail to accused

Paritosh Kumar Siingh Vs Senior Intelligence Officer (Chhattisgarh High Court) dated 18/01/2022


Income Tax Notice issued issued against a dead person, is null and void

Dharamraj Vs ITO (Delhi High Court) dated 17/01/2022


Directors’ personal property cannot be Attached to Recover Companies Sales Tax Dues
Sunita Ramesh Bansal Vs Assistant Commissioner of State Tax (Gujarat High Court) dated 13/01/2022


HC disposes petition as department granted credit as per courts direction which was earlier not given

Siddharth Enterprises Vs Nodal Officer (Gujarat High Court) dated 12/01/2022


Expenses towards provision for pension fund allowable as expenses

ACIT Vs Punjab & Sind Bank (ITAT Delhi) dated 05/01/2022


HC directs unblocking of Electronic Credit Ledger as one year period was expired

Krishna Fashion Vs Union of India (Delhi High Court) dated 18/01/2022

GST Cash credit account of assessee cannot be provisionally attached

Manish Scrap Traders Vs Principal Commissioner (Gujarat High Court) dated 12/01/2022


If assessee resold goods imported from AE without any value addition, than most appropriate method for determining ALP is RPM

Randox Laboratories India Private Limited Vs ACIT (ITAT Bangalore) dated 04/01/2022