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25.02.2013 - Voice of CA Presents - Updates
Monday, February 25, 2013

 I.  Today's Headlines:

  1. Budget 2013: FM curbs plan spend in FY13 to Rs 4.28 lakh crore  (Click for details)
  2. Budget 2013: Many major proposals in last Budget not implemented  (Click for details)
  3. EPFO may decide to pay 8.5% rate for 2012-13 today (Click for details)
  4. FICCI pitches for no TDS on health insurance claims (Click for details)
  5. Bond yields likely to fall; Re may strengthen (Click for details)
  6. Exempt DA from income tax, says National Mazdoor Conference  (Click for details)
  7. Chidambaram's Budget 2013 likely to bring good news for women  (Click for details)

  II.  Useful Case Laws: 

1.   CIT Vs. Ashwani Chopra, ITA No. 353 of 2011, Date of Decision: 10.01.2013, High Court of Punjab & Haryana

Partition of family properties does not amount to transfer, when there is no transfer of asset.

The Division Bench of Karnataka High Court in R. Nagaraja Rao’s case (supra) has held that partition is not a transfer and adjustment of shares, crystallization of the respective rights in the family properties cannot be construed as a transfer in the eye of law. When there is no transfer of asset, there is no capital gain and consequently there is no liability to pay tax on capital gains.

In view of the aforesaid principles of law, we find that the payment of Rs.24 crores to Group A is to equalize the inequalities in partition of the assets of M/s Hind Samachar Ltd. The amount so paid is immovable property. If such amount is to be treated as income liable to tax, the inequalities would set in as the share of the recipient will diminish to the extent of tax. Since the amount paid during the course of partition is to settle the inequalities in partition, therefore deemed to be immovable property. Such amount is not an income liable to tax. Thus, the amount of owelty i.e. compensation deposited by Group B is to equalize the partition represents immovable property and will not attract capital gain.

(Please click here for judgment)

2.  Futura Polyester Ltd. Vs. Commissioner of Central Excise, Appeal Nos. ST/69 & 70 of 2005, Date of Order: 30-07-2012, CESTAT - Bangalore

Merely making entry in books of account did not amount to provision of service

Merely making entry in the books of accounts does not render that the appellants have provided any service. It has been held by the Hon’ble Apex Court in the case of Association of Leasing & Financial Service Companies v. Union of India [2010] 29 STT 316 (SC) that when no service has been rendered, service tax cannot be levied. As held by the apex court in the case of Union of India v. Martin Lottery Agencies Ltd. [2009] 20 STT 203 (SC). The Notification No.19/2008 cannot be said to be have retrospective effect, wherein it was explained that “deems creation of book entry” as receipt of consideration is not retrospective in nature.

(Please click here for  judgment)   

 Golden Rules:

"Sometimes we have to keep quiet, swallow our pride and
accept that we are wrong. It is not giving up.
It is called growing up


  Thanks & Regards


Voice of CA    




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