Topics

1

Discussion / whethre sec. 56(2) for inadequate consideration is double taxation or not

« on: March 04, 2013, 08:26:16 AM »

After introduction of new provisions of sec. 56(2) for inadequate consideration, sec. 50C has become irrelevant as it amounts to double taxation. Same amount is taxed in the hands of seller and purchaser.  Further, it is taxed in the hands of the purchaser as inadequate consideration u/s 56(2), then when the said property is sold by him then whether the amount on which he pays tax is allowable as cost of acquisition? if So under which section? I hope the legislation will dwell upon these issues before finalising the enactment of the proposed Finance BIll.

2

Discussion / Reference to Valutation Officer

« on: June 11, 2012, 07:52:57 AM »

An A.O. after conducting a survey u/s 133A in a case of builder, referred the stock in trade i.e. constuction cost  to valuation cell with a doubt that expenditure incurred may be more than what has been recorded in books of accounts. The Valuation Officer is behind the builder asking to produce vouchers for the expenditure incurred. Now, can the builder request the A.O. under what section the reference is made because, as per the provisions of the Act, only sec. 142A empowers the AO to refer the case to valuation cell. However, fortunately/unfortunately sec. 69C is not mentioned in sec. 142A which means that the law makers didnot envisage that this type of  situation will also arise wherein the stock in trade is to be referred to valuation cell and therefore, they didnot include sec. 69C in sec. 142A. The consequent of which is that this type of  cases cannot be referred to valuation cell asking to estimate the value of stock in trade.  Under the above mentioned circumstances, the builder came across a case of Delhi High Court reported in 319 ITR 276 wherein it was categorically held that there is no provision in IT Act to refer the case of a builder to valuation cell. When this is brought to the notice of AO, he says that in any case, if excess valuation, if any,  estimated by the Valuation Officer  will be added u/s 69, 69B if not under 69C and directed the builder to cooperate with the valuation officer. Under these circumstances, what is the remedy available to the builder except filing a writ.

3

Discussion / sec. 268A of IT Act, comparison with the other issues when same question of law

« on: September 30, 2010, 09:01:11 AM »

carbon credits were not taxed in the hands of one assessee. However, the same AO, in next year taxed the same in case of other assessee and reopened the case of first assessee u/s 148. Accordingly reopened assessment was also completed in the case of first assessee bringing to tax the said carbon credits. When an appeal is filed before appellate authorities against the reopened assessment, it was argued that the AO had changed his opinion and it is not permissable u/s 147 as per the Supreme Court decision in the case of Kelvinator India. The appellate authorities have held that no tangible material has come into the possession of the AO and as argued the AO had changed his opinion which is not permissable u/s147. RElying on the decision cited, the assessment was held as bad in law and therefore, the reassessment was cancelled. Accordingly, the carbon credits were not taxed in the hands of the first mentioned person.

              Now the second mentioned person without going into merits, can take the argument that since the same carbon credits were not taxed in the hands of one assessee it cannot be taxed in his hands also. He wanted to place reliance on Sec. 268A of the IT Act which was brought into the statute only to overcome the supreme Courts decision reported in 266 ITR 99. He further wanted to support his argument with the Apex Courts decisions reported in 229 ITR 219, 229 bITR 221, 254 ITR 606, 308 ITR 161. What are the chances of the assessee to win his appeal if he takes this argument without going into merits.

4

Discussion / non resident - deduction u/s 54F or 54EC

« on: September 08, 2010, 09:22:20 PM »

can the deduction/exemption u/s 54F or 54EC can be denied on the ground that the assessee is a non resident.