Income Tax – Section 43B – Deduction Disallowed – Bottling Fee – Actual Payment Required – Held that furnishing of bank guarantee does not amount to “actual payment” under Section 43B – Requirement is for actual outflow of funds to the exchequer – Bottling fees are not tax, duty, cess or fee but consideration for exclusive privilege under excis...
Taxation Law - Section 25(4) Income Tax Act - Relief – Date of “Succession in such capacity” – Executors carrying on business after death pending sale – Held: Succession occurs on death, not on later sale – The testator’s shipping agency business was directed by will to be continued by executors as a going concern for up to one year pending sale – He...
Taxation Law - Income from Property – Section 9(1)(iv) – “Annual charge not being a capital charge” – Deductibility of Bombay municipal property tax and urban immovable property tax – The assessee, an investment company, claimed deduction of municipal property tax and urban immovable property tax paid during the year – Held: Both levies are annual liabilit...
Income Tax – Accrual of Income – Mercantile System – Reduction of Commission – Assessee-firm, acting as managing agents of two shipping companies, originally entitled to 10% commission on freight, agreed during the accounting year to reduce the rate to 2½% – Larger commission shown in books but reduced by agreement before close of year – Held: Mere book e...
Income Tax – Reference under Section 66 – Scope of Jurisdiction – High Court’s jurisdiction under Section 66 is confined to questions of law arising out of the Tribunal's order – Such questions must have been raised before or dealt with by the Tribunal – Held: A question neither raised before the Tribunal nor dealt with by it cannot be said to arise out of i...
Taxation Law - Goods and Services Tax – Cross-Empowerment – Jurisdiction of CGST Officers – Petitioners assigned to State Tax Authorities challenged issuance of show cause notices by Joint Commissioner, CGST – Held: Section 6(1) of CGST Act provides inherent and automatic cross-empowerment to officers of Centre and States – Notification required only when conditions a...
Customs – Duty Drawback – DEPB Scheme – Re-export of Defective Goods – Refund Mechanism – Appellant imported watch parts, paid duty via DEPB debit – Upon finding parts defective, re-exported the same and claimed duty drawback under Section 74 – Department rejected claim on ground that duty was not paid in cash – Held: Once goods are re-exported, asse...
Taxation – Classification – Article 14 – Validity of taxing only Virginia Tobacco – Andhra Act XIV of 1955 amended Section 5 of Madras General Sales Tax Act to impose tax on Virginia tobacco while exempting country tobacco (Nattu tobacco) – Held: Classification based on clear and intelligible differentia such as taste, texture, cultivation, usage, and marketability &n...
Entertainment Tax – Discrimination Based on Language – Article 14 Violation – Andhra Pradesh levied 24% entertainment tax on Hindi films while levying only 10% on Telugu films – Held: Classification based solely on language is arbitrary – No reasonable nexus with object of taxation – Violates Article 14 of the Constitution – Impugned notification struck do...
Taxation – Works Contract – Transfer of Property in Goods – Printing of Lottery Tickets – Appellant engaged in printing lottery tickets using ink and chemicals procured by itself while paper was supplied by contractee – Assessing Authority levied tax under Section 3F(1)(b) of U.P. Trade Tax Act on ink and chemicals – Appellate Authority and Tribunal deleted levy...