SC

SC: Upholds deduction for employees' club membership fee as "pure business expense" 

Club membership fee of the employees is ‘pure business expense’ and deductions allowed u/s 37; Referred to various HC rulings which have held that club membership fee of employee is

Oct 25,2012

SC: ‘Contribution’ and not ‘reimbursement’, subject matter of Sec 40A(9) disallowance

Interpretation of Sec 40A(9) brings out dichotomy between 'contribution' and 'reimbursement'; No disallowance unless expenses claimed in the nature of ‘contribution’; ITAT directed to decide matter afresh after giving clear

Oct 01,2012

SC: Permits deviation in stock valuation; considers "levy price" over cost/ market value 

If facts permit, closing stock can be valued at a price other than cost or market value, though this is the accepted practice; Regards to be given to character of

Sep 27,2012

SC: "Silly mistake" or "Human error" not justifiable grounds to levy penalty 

No penalty on erroneous tax claim by PwC due to "human error"; Even assessee of high expertise and reputation can make "silly mistake"; AO also overlooked the mistake during original

Sep 26,2012

SC: Rejects 'theoretical exercise' of recomputing amortised income 

Assessee offered to tax interest from debentures as difference between purchase price and redemption price; Income offered on proportionate basis over the life of debentures; HC order taxing income in

Sep 14,2012

SC: NRI donors must show financial capacity to "gift" to discharge Sec 68 onus 

NRI donors assessed to tax in Singapore must show adequate funds in bank accounts and financial capacity to make gifts; Burden on the assessee u/s 68 as recipient to show

Sep 14,2012

SC: Applies 'substance over form' test, holds contingent deposits as income 

'Contingent deposits' collected from customers to safeguard against disputed sales tax liability constituted 'income'; Deposits were not kept in a separate interest bearing bank account but formed part of business

Sep 12,2012

SC: Allows tax holiday based on unit-wise profitability despite absence of separate books 

Assessee not statutorily obliged to maintain separate accounts for claiming deduction u/s 80HH and 80I; But, to end ongoing litigation, directs AO to examine unit-wise profitability working prepared by the

Sep 12,2012

SC: Lumpsum know-how expense should be amortised, Deduction can't be claimed at once 

Lumpsum expenditure for acquisition of know-how cannot be allowed u/s 37(1); Sec 37(1) has no application once Sec 35AB for amortisation of such expenditure comes into play; Know-how must be

Sep 11,2012

SC: Follows 5-judge ruling, Interest on tax payment default mandatory but waiver permissible

Levy of interest u/s 234A and 234B for default in tax payments mandatory in nature; AO need not ‘specifically recite’ initiation of penalty proceedings in assessment order; 5-Judge ruling in

Sep 11,2012

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