Court : Income Tax Appellate Tribunal ITAT Madras
Reported in : (1988)26ITD79(Mad.)
1. This is an appeal objecting to the order of the AAC who confirmed the gift-tax assessment made on the appellant in respect of a settlement deed executed by him on 28-3-1981 by treating it as a gift for the asst. year 1981-82, for which the previous year ended on 31-3-1981. The assessee had filed a return for this year admitting 'nil' gift. But in the statement accompanying the return he admitted the value of the gift at Rs. 1,10,711 and the gift-tax paya,ble at Rs. 6,877. Subsequently he claimed exemption of the gift from the Gift-tax Act stating that the Explanation to Section 19 of the Transfer of Property Act provided that vested interest would not be defeated by the death of the transferor. He also relied on the decision of the Madras High Court in the case of CGT v. C. Thiruvenkata Mudaliar [1977] 107.ITR 661, wherein it was held that there was no gift made in the circumstances similar to the assessee's case. The GTO rejected these contentions and relying on the decision of th...
Tag this Judgment!Court : Income Tax Appellate Tribunal ITAT Madras
Reported in : (1988)24ITD391(Mad.)
1. These appeals by the assessee and the revenue relate to the claims of the assessee for deductions in computing the total income for the assessment year 1981-82.2. The assessee is a private limited company, carrying on business in film production and distribution as well as hiring of machinery.3. The previous year of the assessee relevant to the assessment year 1980-81 ended on 28-2-1980. Therefore, the previous year for the present assessment year 1981-82 should have ended on 28-2-1981. But the company changed its accounting year to end on 31st March by resolution of the Board of Directors dated 24-9-1981 which stated that it was changed as the assessee became a subsidiary company of another company which closed its accounts on 31-3-1981. By its letter dt. 24-9-1981 the assessee informed the ITO that it has no objection for being assessed for a period of 13 months, i.e., from 1-3-1980 to 31-3-1981 for the assessment year 1981-82. Accordingly, the assessment has been made in respect...
Tag this Judgment!Court : Income Tax Appellate Tribunal ITAT Madras
Reported in : (1988)24ITD356(Mad.)
2. The first common point in dispute relates to the capitalisation of the interest charges arising from the purchase of plant and machinery under deferred payment terms. The assessee had purchased a plant and machinery for setting up a new industrial undertaking in respect of which the ITO has granted relief Under Section 80J and hence the question whether it is a new unit is not in dispute before us. The assessee claimed that the interest charges up to the date of setting up of the plant should be capitalised and should be treated as part of the cost of the plant and machinery. The case of the Revenue is that any interest charged must be treated as revenue expenditure and cannot be treated as part of the cost. The Revenue relied on the decision of the Tribunal dated 21-5-1984 in ITA No. 1187/Mds/83 of the assessee for the assessment year 1979-80 where the interest element was treated as revenue expenditure. But it is pointed out by the assessee that the law has been clarified by the ...
Tag this Judgment!Court : Income Tax Appellate Tribunal ITAT Madras
Reported in : (1988)24ITD511(Mad.)
1 to 9. [These paras are not reproduced here as they involve minor issues.] 10. For the assessment year 1980-81 there is one additional point with reference to the computation of the extra shift allowance. The contention of the Revenue is that the extra shift allowance should be computed with reference to each individual machine and not with reference to the working of the concern as such even though that is the procedure laid down by the circular of the CBDT No. F. 10/83/8/ITA-II, dated 28-9-1970. According to the revenue, there is a decision of the Madras High Court in South India Viscose Ltd. v. CIT [1982] 135 ITR 206 stating that extra shift allowance should be computed only with reference to the working of each machinery and therefore the circular could not be given effect to. The revenue also relied on the decision of the Delhi High Court in Geep Industrial Syndicate Ltd. v. CBDT [1987] 166 ITR 88 to say that where there is a decision of the High Court the circular need not be a...
Tag this Judgment!Court : Income Tax Appellate Tribunal ITAT Madras
Reported in : (1988)26ITD73(Mad.)
1. This is an appeal filed by the assessee against the order of the AAC for the asst. year 1980-81. The wealth-tax assessment in this case for the asst. year 1980-81 was originally completed on 18-4-1981. During the course of that assessment, the assessee declared value of her house property at Pantheon Road, Madras at Rs. 2,91,000 as per provisions of Section 7(4) of the Wealth-tax Act, on the basis of the value fixed for the building in the wealth-tax assessment for the year 1971-72. The WTO accepted the value declared by the assessee for the building in the course of the assessment made by him on 18-4-1981. Later, he proceeded to reopen the assessment by issuing a notice under Section 17(6) of the Act on the ground that the house consisted of substantial vacant land, which was not appurtenant to the main building and as the exemption under Section 7(4) has to be limited only to the house and the appurtenant land and not to other vacant land, he thought that the wealth represented b...
Tag this Judgment!Court : Income Tax Appellate Tribunal ITAT Madras
Reported in : (1988)24ITR261(Mad.)
1. to 21. [These paras are not reproduced here as they involved minor issues.] 22. The last objection in the revenue's appeal is to the decision of the CIT (Appeals) holding that the exemption under Section 54 was available to the assessee, who was assessed in the status of HUF.During the previous year, the assessee sold his residential house at No. 110, West Sandaipettai Street, Madurai for Rs. 6 lakhs on 6-5-1981.In respect of the long-term capital gains arising on the sale of this property, the assessee claimed exemption Under Section 54(1) of the IT Act, which was disallowed by the ITO for the reason that the assessee was not entitled to this relief, as he was being assessed in the status of a Hindu Undivided Family. According to the Income-tax Officer only individuals can claim this relief Under Section 54(1). The CIT (Appeals), however, disagreed with this view of the Income-tax Officer and held that the language used in Section 54(1) was such that the relief could be claimed ei...
Tag this Judgment!Court : Income Tax Appellate Tribunal ITAT Madras
Reported in : (1988)26ITD23(Mad.)
1. These appeals are directed against the addition made Under Section 64 of the Income-tax Act, 1961.2. The admitted facts are as follows. There was a family consisting of Shri T.N.K. Iyengar and his seven sons. This family, however, did not have any ancestral property. On 9-9-1980 each of the coparceners made the following declaration : I am throwing today the following asset into the common hotchpot of the Hindu undivided family of which I am the Karta, with an intention to impress the same with the character of ancestral property.Upon such declaration, the amount contributed by each of the coparceners was as follows : On the next day, i.e., 10-9-1980, an agreement of partition was executed by which the said total amount of Rs. 2 lakhs was divided equally among the eight coparceners, each getting Rs. 25,000.3. In the assessments made for the assessment year 1982-83 for each of these coparceners in his individual capacity the IAC added the income attributable to the share received on...
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