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16.08.2012 - Voice of CA Presents - Updates
Thursday, August 16, 2012


I.  Whats New: 

  • Measures to Tackle Black Money in India and Abroad - Report of the Committee Headed by Chairman, CBDT  (Click for detail)
  • Premature Repayment of Term/Fixed Deposits in banks with “Either or Survivor” or “Former or Survivor” mandate – Clarification  (Click for detail)
  • Tribunal grants tax relief for FIIs using forex forwards  (Click for detail)
  • 14 More I-T units to Track Black Money  (Click for detail)

 II.  Useful Case laws:

1.    Krishan Gopal Chhabra Vs. ITO, ITA No. 1548/Del/2010, Date: 08-08-2012, ITAT – Delhi

Addition u/s 68 on account of gift received from unconnected person is valid.

By applying to the Judgment of Hon’ble Delhi High Court in the case of Rajiv Tondon vs. ACIT 294 ITR 488 . Held that there is no relationship of the donor with the assessee. There is also no occasion for this gift. The taxing authorities have rightly looked into the surrounding circumstances and drawn the conclusion that gift in this case was not genuine. So the addition was rightly made u/s 68 of IT Act.

(Please click here for judgment)


2.   M/s. Jai Hind Rubber Products Vs ACIT, ITA No.2296/Mum/2011, Date of pronouncement: 03.08.2012, ITAT- Mumbai

Assessee is entitled to exemption under section 54E in respect of capital gains arising on transfer of a capital asset on which depreciation has been allowed

The assessee cannot be denied exemption under section 54E, because, firstly, there is nothing in section 50 to suggest that the fiction created in section 50 is not only restricted to sections 48 and 49 but also applies to other provisions. On the contrary, section 50 makes it explicitly clear that the deemed fiction created in sub-sections (1) and (2) of section 50 is restricted only to the mode of computation of capital gains contained in sections 48 and 49. Secondly, it is well established in law that a fiction created by the Legislature has to be confined to the purpose for which it is created. Thirdly, section 54E does not make any distinction between depreciable asset and non-depreciable asset and, therefore, the exemption available to the depreciable asset under section 54E cannot be denied by referring to the fiction created under section 50. Section 54E specifically provides that where capital gain arising on transfer of a long term capital asset is invested or deposited (whole or any part of the net consideration) in the specified assets, the assessee shall not be charged to capital gains. Therefore, the exemption under section 54E of the Income-tax Act cannot be denied to the assessee on account of the fiction created in section 50. (CIT Vs ACE Builders (P.) Ltd[2006] 281 ITR 210 (BOM.) followed.)

(Please click here for judgment)


  Golden Rule:

"Don't Compare yourself with others. 
You are a Unique Person in world.

  "Team - Voice of CA" 

CA. Sanjay 'Voice of CA' Agarwal
Mob: 9811080342, 
CA. Sidharth Jain, Co-Moderator  
CA. Mukesh K Bansal, Co-Moderator-FEMA 

CA. Avinash Gupta, Co-Moderator-International Taxation 

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