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Kanoi Industries (P) Ltd. Vs. Deputy Commissioner of Income Tax

Court : Income Tax Appellate Tribunal ITAT Kolkata

Reported in : (2006)100ITD462(Kol.)

..... 1993-94 has escaped from assessment, a notice under section 10 of the interest-tax act, 1974, was issued on ..... ao has, in consequence of information in his possession, reason to believe that chargeable interest assessable for any assessment year has escaped assessment or has been underassessed or has been the subject of excessive relief under this act.from the analysis of the above provisions, it is clear that it is pre-requisite that the ao should record the reasons to the effect that interest income has escaped assessment under interest-tax act, 1974.while recording the reasons the ao must have reasons to believe on the basis of material ..... the ao passed the orders under section 8(2)/10 of the interest-tax act, 1974 (the act), reopening and reassessing the interest-tax chargeable on the assessee and thereby imposing liability on the assessee ..... interest-tax act, 1974, the charging section is section ..... assessee falls in the category of 'credit institution' falling within the ambit of section 2(5a) and 2(5b) of interest-tax act, 1974? ..... of audit party, it is seen that it has raised an issue which is purely legal issue and it is almost settled proposition that an opinion of audit party on any point of law cannot be regarded as "information" occurring in relevant section 10 of the interest-tax act, 1974. ..... learned ao erred in having entertained this belief without holding that assessee is a credit institution falling within the ambit of section 2(5a) or 2(5b) of the interest-tax act, 1974. .....

Shyamsunder Musahib Vs. Wealth-tax Officer

Court : Income Tax Appellate Tribunal ITAT Kolkata

Reported in : (1994)48ITD109(Kol.)

..... reopening of the assessment proceedings for the assessment years 1973-74 and 1974-75 were on the basis of a mere change of opinion on the part of the wto.the assessee had duly shown the value of his interest in the firm m/s.durga trading corporation on the basis of valuation by an approved valuer which was duly accepted when the original assessment was made.there was no basis or material with the wto to hold that the provisions of section 17(1)(a) of the wealth-tax act, 1957 are ..... it may be mentioned and useful to reproduce the reasons for reopening the assessment proceedings under section 17{l)(a) of the wealth-tax act, 1957 recorded by the wto for the two assessment years as below: on perusal of records it appears that the shares of partnership interest of the assessee in the value of house property owned by the firm m/s. ..... the assessing officer also should properly apply his mind to such material and he must draw an inference based on reason, that the wealth has escaped assessment. ..... on going through section 17(1) of the wealth-tax act, 1957, we find that the assessing officer must have "reason to believe that the net wealth chargeable to tax has escaped assessment" etc. ..... the wto, therefore, acted under a genuine belief that in the return of net wealth the assessee had not disclosed the true value of the property which had resulted in escapement of net wealth. ..... there has also to be a nexus between such material and formation: of belief of escapement of wealth. .....

Kusum Products Ltd. Vs. Income-tax Officer

Court : Income Tax Appellate Tribunal ITAT Kolkata

Reported in : (1989)29ITD293(Kol.)

..... while filing the return of income for the assessment year 1974-75 on 31-7-1974, the assessee in the statement of details of interest received showed this amount as under : interest under section 214 allowed in asst. ..... 1,14,212 either on the ground that it was not assessable being an interest received from the income-tax department or on the ground that the interest having accrued in february 1972 at the time of passing of the assessment order for the assessment year 1967-68, that admittedly the interest payable to the assessee-company for the assessment year 1967-68 became payable in february 1972 and so it was assessable in the assessment year 1972-73. ..... 1,14,212 became the income of the assessee.admittedly, the amount of interest under section 214 related to the assessment year 1967-68, the assessment of which was made on 25-2-1972.the assessee's accounting year ends on 31st march every year. ..... 1,14,212 is not assessable to tax for the assessment year 1974-75 is not acceptable, as the interest arose in the financial year 1973-74 and as such it is assessable in the assessment year 1974-75. ..... 1,14,212 would have escaped assessment altogether. ..... 1,14,212 to arrive at the returned income and that the assessee was, therefore, liable to penalty under section 271(1)(c) of the income-tax act, 1961. ..... (ii) if the return filed by the assessee was accepted without any examination or scrutiny the assessee could have escaped the tax on the income of rs. .....

Deputy Commissioner of Vs. I.O.L. Ltd.

Court : Income Tax Appellate Tribunal ITAT Kolkata

Reported in : (1994)50ITD214(Kol.)

..... that calcutta high court has no occasion to discuss this matter in the context of interest chargeable under section 139(8) we noticed that while taking the definition of month' as calendar month for the purpose of penalty under section 271(1)(a) the calcutta high court has mentioned that this definition will apply to the term 'month' occurring in the income-tax act, 1961 unless there is something in the context which will exclude such application ..... scheme of imposition of penalty under section 271(1)(a) and scheme of levying interest under section 139(8) for the same default, is that while penalty is imposed @ 2% of assessed tax per month, the interest is levied @ 15% per annum on amount of tax payable.thus, there is nothing common between the scheme of penalty and the scheme of interest except the period of default which is reckoned from the day immediately following specified date to the date of furnishing of return or date of assessment under section 144 with only ..... . [1974] 97itr 285 wherein it was held that the word 'month' occurring in section 271 (1)(a) must be taken to mean a period of 30 ..... if the english calendar month is adopted, it may in some cases lead to a defaulting assessee escaping penalty altogether.8 ..... 811 dated 11-12-1974 issued by the central board of direct taxes, new delhi and submitted that according to the board's instruction actual date of filing the return, should also be included in computing the period for which the interest is chargeable under section 139(8) .....

Deputy Commissioner of Income Tax Vs. Venkateswar Investment and

Court : Income Tax Appellate Tribunal ITAT Kolkata

Reported in : (2005)93ITD177(Kol.)

..... " precludes an inference that a company could be a "financial company" for one year and not so for the others so that the mere accident of earning higher interest than the turnover of the company or due to temporary lull in the business of the assessee need not attract the provision of the interest-tax act, 1974.the learned counsel emphasized that the deeming provision in a taxing statute has to be strictly construed and explanation below section 73 being a deeming provision has to be construed accordingly. ..... there may be a case where in any particular assessment year, the income from interest is lower than the income/loss from share trading or there may be a temporary lull in the business activities of a company in a particular year. ..... 1997-98, whether the assessee can be said to be having principal business of granting loans and advances and not hit by explanation to section 73 of the it act merely because in the preceding assessment years the assessee was not dealing in shares but was having interest income from loans and advances and rental income from leasing." 2. ..... 13th dec, 1999, the assessee filed the figures of the fund employed in the business of granting loans and advances for the last 3 years and also of the year under assessment which shows that loans and advances were rs. .....

Dy. Commissioner of Income-tax Vs. Venkateswar Investment and

Court : Income Tax Appellate Tribunal ITAT Kolkata

..... assessment years 1992-93 to 1996-97 dated 11.6.2001 wherein it was held that the use of the words "principal business" preclude an inference that a company could be a "financial company" for one year and not so for the others so that the mere accident of earning higher interest than the turnover of the company or due to temporary lull in the business of the assessee need not attract the provision of the interest tax act, 1974 ..... is more than the income of the assessee from other sources in the assessment year 1997-98, whether the assessee can be said to be having principal business of granting loans and advances and not hit by explanation to section 73 of the i.t.act merely because in the preceding assessment years the assessee was not dealing in shares but was having interest income from loans and advances and rental income from leasing." 2. ..... this decision of the hon'ble high court although relates to the provision of section 104 read with section 109 of the income-tax act, but being in pari materia with the issue before us, is applicable and overall view of the function of the assessee company of the relevant period as well as of the past years ..... the matter, we hold that there is no mistake in the order of the cit(appeals) in holding that the case of the assessee company is not hit by explanation to section 73 and the loss so suffered shall be treated as business loss and not speculation loss and question referred to is answered in favour of the assessee and the grounds of appeal .....

National Engineering Industries Vs. Joint Commissioner of Income Tax

Court : Income Tax Appellate Tribunal ITAT Kolkata

Reported in : (2002)80ITD9(Kol.)

..... an interesting question in these appeals arise and that is with regarding to the scope of applicability of provision of interest-tax act, 1974 to a company which is not a financial company, in its ordinary meaning. ..... in other words, the assessee could not be treated as a financial company so that the assessee could not be treated as a financial company so that the assessee could not come under the purview of interest-tax act, 1974.15. ..... these 21 appeals--17 by the assessee and 4 by the revenue--arise under the interest-tax act, 1974. ..... ; (ii) the acquisition of shares, stock, bonds, debentures or securities issued by government or local authority or other marketable securities of a like nature; (iii) letting or delivering of any goods to a hirer under a hire purchase agreement as defined in clause (c) of section 2 of the hire purchase act, 1972; (v) managing, conducting or supervising, as foreman, agent or in any other capacity, of chits or kuries as defined in any law which is for the time being in force in any state, or any business, which is similar hereto; (vi) collecting, for ..... it provides the levy of tax on every credit institutions for every assessment year commencing on or from 1st april, 1992 and interest-tax in respect of its chargeable interest of the previous year.2. ..... all these appeals are against the orders of the cit(a) for various assessment years. .....

Tara Finvest Ltd. Vs. Income Tax Officer

Court : Income Tax Appellate Tribunal ITAT Kolkata

..... , 2000, by the cit(a) wherein the assessee is in appeal raising the issue that in the facts and circumstances of the case, the learned cit(a) erred in considering the business of providing finance as its principal business in terms of section 2(5b)(iv) of the interest-tax act, 1974, as assessed by the ao under section 8(3) of the interest -tax act.2. ..... he, therefore, completed the assessment ex parte under section 8(3)of the interest-tax act which the learned cit(a) on examination of assessment record inclined to agree with the finding of the ao. ..... proceeded to base his observation read with section 2(58)(iv) of the interest-tax act by considering the capital against loans and advances. ..... the learned counsel for the assessee submitted that the learned ao in his order considered the financial statement of the assessee and in view of section 2(5b)(iv) considers the assessee's income as business of providing finance whether by making loans and advances or otherwise.he, therefore, proceeded to consider his own application of mind in applying earning of interest as that of credit instituted as per section 2(5a) of the interest-tax act. ..... therefore, the claim of running a trading business has failed to fulfil the condition as principal business with reference to section 2(5b)(iv) of the act which, inter alia, includes a business of providing finance, whether by making loans or advances or otherwise for the purpose of interest-tax act. .....

Joint Commissioner of Income Tax, Vs. I.T.C. Ltd.

Court : Income Tax Appellate Tribunal ITAT Kolkata

Reported in : (2008)112ITD57(Kol.)

..... top allow deduction under section 80hhc of the income tax act, 1961 as per computation made by the assessee's auditor without pointing out any defect in the computation made by assessing officer.2. ..... must be judged not in the light of the 19th century laissez faire doctrine which regarded man as an - economic being concerned only to protect and advance his self-interest but in the context of current socio-economic thinking which places the general interest of the community above the personal interest of the individual and believes that a business or undertaking is the product of the combined efforts of the employer and the employees and where there is sufficiently ..... ltd. decided the issue in favour of assessee by holding as under: from the above discussion, we find in relation to each assessment years involved in this appeal that the recipient of interest-free loan was not a firm of relatives; the advance was made for the purpose of business within the meaning of section 36(1)(iii); that there was regular course of business between the assessee and the firm; and that the advances were made to mcap in the regular ..... v. cit reported in 288 itr page 1 has held as under: to consider whether one should allow deduction under section 36(1)(iii) of interest paid by the assessee on amounts borrowed by it for advancing to a sister concern, the authorities and the courts should examine the purpose for which the assessee advanced the money and what the sister .....

Ms. Enfield Industries Ltd. Vs. Dy. Cit

Court : Income Tax Appellate Tribunal ITAT Kolkata

..... accordingly, an application for settlement under section 245c(1) of the income tax act, 1961 was already filed by enfield industries limited for the block period as well as for the assessment year 2000-01 and the individuals, namely, sri satyadeo sonthalia, sri sudesh kumar sonthalia and sri rajesh kumar sonthalia were on the verge of filing their respective abatment applications ..... the penalty under sub-section (2) of section 158bfa is optional unlike the interest chargeable under sub-section (1) since the word used in sub-section (2) is "may" unlike the word "shall" used in sub-section (1). ..... khandsari sugar works (supra) the allahabad high court had held that where the assessee agreed to higher assessment to escape penal consequences and the assessment was made on estimate, there being no evidence of concealment, cancellation of penalty was justified. ..... disclosure was made on condition of granting immunity from penalty and prosecution as well as waiver of interest.the block assessment was completed on the basis of the aforesaid conditional disclosure on 31-12-2001. ..... support of the contention that disclosure was made on condition of granting immunity from penalty and prosecution as well as waiver of interest, the assessees learned counsel invited our attention on pages 71 to 84 and 93 & 94 of the paper book which are three letters addressed to dcit, central circle-vii, kolkata dated 20-12-2001 & 9-1-2002 and commissioner of income tax, central circle-i, kolkata dated 21-12-2001. .....