Latest Developments from Supreme Court of India (SC) in context of Income Tax Act, 1961.
1. SC in Harig Crank Shaft : In this case, SC has issued notice on revenue's SLP against Delhi High Court (DHC) order, on the question pertaining to section 43B of the Act, wherein DHC has followed its earlier ruling in the case of Dharmender Sharma 297 ITR 320, on issue relating to section 43B of the Act (wherein DHC following SC in Vinay Cements 213 CTR 268 has held that amendment in section 43B by Finance Act, 2003 - omission of second proviso - to be curative/retrospective in nature). DHC ruling in Dharmender Sharma stands followed in P.M.Electronics case 220 CTR 635 and Delhi ITAT ruling in Suhag Traders 114 TTJ 116 & SC ruling in Vinay Cements has been followed by Madras High Court in Nexus Computers 219 CTR 54, to hold that amendment in section 43B by Finance Act, 2003 (omission of second proviso- EPF payment by Due Date of Return filing).
2. SC in Price Gutka Limited: In this case, SC after condoning delay has dismissed revenue’s SLP against DHC order, wherein it was held that in case excise law proceedings against the assessee on basis of which income tax proceedings were initiated against the assessee, are ordered by Excise Tribunal/appellate authority (CESTAT) to be without substance, then:
“These findings of fact rendered by the Tribunal having jurisdiction over the matter have become conclusive. They are, therefore, binding upon the Income Tax Department as well, particularly since the direct tax proceedings were initiated on the basis of the show cause notice issued by the Central Excise Department.”
3. SC Joyco India Limited: In this case, SC in context of concealment penalty u/s 271(1)(c) by speaking order dismissing revenue’s SLP, has observed that “The Special Leave Petition is dismissed as we are of the view that in this case the penalty was not leviable since the point involved was a debatable point.”
4. SC in case of Jayanti Lal (Underlying Guj HC order reported at 219 CTR 26/177 Taxman 357 wherein while admitting assessee’s Writ Petition against block assessment notices issued against petitioner u/s 158BC of the Act, Guj HC quashed the same as after pursuing records it was found that there was no search conducted on assessee-petitioner), SC interestingly has issued notice on revenue’s SLP observing:
“Issue notice as to why the assessee should not be directed to take up all contentions in the block assessment proceedings including the question on the legality of Warrant of Authorization. Prima facie, the question raised cannot be decided in writ petition. Dasti granted.”
5. SC in case of K.K.Mohta (petitioner), where revenue filed criminal complaint against petitioner (being managing director in assessee company – Mohta Electo Steel Limited) u/s 276C(1) for deliberate intention to evade tax (for claiming excessive/unreasonable expenses as disallowed in tax assessment proceedings, affirmed by CIT-A) and CHARGES were ordered to be framed against petitioner director by Additional Chief Metropolitan Magistrate on revenue’s compliant, DHC in its welcome order, on petitioner’s request u/section 482 of Criminal Procedure Code, has discharged the petitioner from revenue’s complaint reasoning that :
“If the issue where the amount paid by assessee company was reasonable or not, admitted of more than one point of view, as is evident from orders of AO and ITAT (gave part relief to assessee company against subject order of AO), then certainly the essential ingredient of section 276C (1) of the Act of a deliberate intent on the part of the assessee to evade the payment of income tax, cannot be said to exist in the present case.”
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