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10.05.2018 - Voice of CA presents - Latest Updates
Thursday, May 10, 2018

  I. Headlines Today:   

  1. ITR 4 for AY 2018-19 is now available for e-Filing. Other ITRs will be available shortly (Click for download)
  2. Walmart-Flipkart deal to face scrutiny from income tax dept  (Click for detail)
  3. Government likely to withdraw tax notice on free banking services  (Click for detail)
  4. E-way bill: All you need to know & experiences of the first month  (Click for detail)
  5. Trader gets GST notice for 17-pt decimal error  (Click for detail)
  6. Your official tour daily allowance will be taxed if you don't have bills  (Click for detail)
  7. SEBI amends Listing obligations and Disclosure requirements  (Click for detail)  

II. A Useful Presentation:

1.  Taxation of Charitable Trusts
      [Under Income Tax Act, 1961]

      (Please click here)

2.  Registration of Trusts

     (Please click here)

(Contribution by CA. Sanjay K. Agarwal, Founder - Voice of CA; and contributor is available at Email-id: )

  III. Direct Taxes Case Law: 

1.   Commissioner Vs. Mahindra and Mahindra Ltd., Civil Appeal Nos. 6949-6950 of 2004, Date of Pronouncement: 24.04.2018, Supreme Court of India

Whether the wavier of loan for purchase of capital goods would constitute as taxable income in hands of the recipient.

Held:- No

Brief Facts
The assessee-company entered into an agreement with Kaiser Jeep International Corporation (KJIC) a subsidiary of Kaiser Jeep Corporation(KJC) based in America where KJIC agreed to sell dies, welding equipments to the assessee. For procurement of above purchases, KJC agreed to provide loan to assessee at the rate of 6% repayable after 10 years in installments. Later on American Motor Corporation (AMC) took over KJC and agreed to waive the principal amount of loan advanced and cancel all the matured promissory notes on 17.02.1976 which were received back in cash. On 30.06.1976, the assessee filed its return showing 57,74,064 as cessation of liability towards AMC. The Ld.AO treated the sum as income and taxable u/s 28 of Income tax Act. The Ld. CIT(A) upheld the order of ld.AO which was set aside by Hon’ble ITAT and the Hon’ble High Court of Bombay. Being aggrieved, the revenue has filed an appeal before Hon’ble Supreme Court of India.

The Hon’ble Supreme Court held that the sine qua non of Sec 28 is receipt of benefit or perquisite in form other than money which is not satisfied in the present case as money already paid is received back in cash on account of loan waiver.
On the Ld. CIT(A) order taxing the amount under Sec 41, the Hon’ble Supreme Court held that Sec 41 only applies to cessation of trade liability and the liability mentioned supra is on the capital account and not in nature of income.
The appeal was held in favour of the assessee and against the revenue.

(Please click here for judgment)

Golden Rules:

  "If you salute your work, you do not have to salute anybody.
If you pollute your work, you have to salute everybody" 


Thanks & Regards


Voice of CA 

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