1. CIT Vs MMTC –DELHI- HIGH COURT- COD APPROVAL- SECTION 256

Income tax - Reference application - Revenue argues the assessee being a public sector undertaking should have sought CoD clearance before filing a reference - held, the right to file a reference is conferred by the statute, and the judgment of the Supreme Court in the ONGC case ( 2002-TIOL-196-SC-CX ) does not seek to take away this right. An approval from CoD for filing the reference is not a pre-requisite. Had it been the case, even the Revenue would have required such a perimission from the CoD to file this petition - Revenue's appeal dismissed.

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2. M/s ESCORTS HEART INSTITUTE & RESEARCH CENTRE LTD OKHLA ROAD, NEW DELHI VS DCIT-ITAT DELHI- SECTION 37(1)

Income tax - Sec 37(1) - Assessee is a hospital - pays heavy premium for keyman insurance policies taken in the name of a super specialist doctor, the MD and the CMD - claims deduction - AO holds since the benefits were given to individuals, and the expenses were incurred by the assessee not for wholly and exclusively for the purpose of business and the fact that no perquisites were shown in the hands of the beneficiaries, it is not allowable deduction - CIT(A) grants part relief - held, merely because the assessee is a specialised hospital, only doctors can run the show successfully. What is also required to run the business successfully is business acumen which come from the top functionaries of the organisation. Profit in any business is a time-tested guiding factor and any dip in it clearly shows its relationship with the persons insured by the assessee - the premium paid for their insurance policies cannot be disallowed - Assessee's appeal allowed.

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3. M/s Royal Palms (India) Ltd Vs ACIT, Mumbai (Dated: August 13, 2009)- Bombay ITAT- SECTION 158BD

Income Tax - Sec 158BD - Assessee is engaged in the business of Real Estate Developments, Hotels, Golf Course, Developing and marketing of commercial & residential properties - on the basis of information received from the DCIT, notice u/s 158BD  served on the assessee - The total undisclosed income determined – Assessee contends before the CIT(A) that the initiation of proceedings u/s. 158BD is not legal as the same is initiated without recording requisite satisfaction as required under law - CIT(A) dismisses the assessee Appeal - Held, since the satisfaction has not been recorded in accordance with law, the proceedings are bad in law and, accordingly, the assessment is annulled. Assessee's appeal allowed.

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"Voice of CA"

CA. Kapil Goel, Moderator-Direct Taxes, Mob:9910272806, cakapilgoel@gmail.com

CA. Sidharth Jain, Co-Moderator, Mob: 9810418700, sidhjasso@yahoo.com

CA. Mukesh K Bansal, Co-Moderator-FEMA, mkak@rediffmail.com