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Showing posts from January, 2013

SC on Depreciation

'Leasing firm entitled to depreciation if the lessee uses the vehicle for hiring'
It is not necessary that the assessee must have used the asset itself in order to be entitled to depreciation, held the Supreme Court in ICDS Ltd v CIT. It was contended by the revenue that one of the requirements for grant of depreciation is use of the asset by the assessee and in case of lease of the asset by the assessee, it simply could not have used the asset as it was physically with the lessee. The apex court, while rejecting this contention, held that user contemplated was for the purpose of business. It was indeed used for the purpose of business when the asset was leased and the lessee used it. That the vehicle was registered in the name of the lessee with the transport authorities, need not come in the way of grant of depreciation, said the court. It also upheld the claim of the leasing company that since the lessee used the vehicle for…


CBEC Circular On Recovery Dated 01.01.2013 & Connected Legal Developments The Bombay High Court today (17.01.2013) granted ad-interim stay against coercive recovery pursuant to Circular No. 967/01/ 2013 – CX dated 01.01.2013 issued by the Central Board of Excise and Customs. The orders were passed in the case of Uhde India Pvt. Ltd vs. UOI WP 380 of 2013, Exide Industries Ltd vs. UOI WP No. 381 of 2013 and connected matters. The Petitions are now listed for admission on 31.01.2013 to enable the Department to file a reply. The Andhra Pradesh High Court has already granted on 09.01.2013 a stay in the matter in the case of Ultratech Cement Ltd vs. UOI W.P. No. 736 of 2013. The view that is taken by the High Courts in these matters will have considerable bearing in income-tax matters as well.


Major Recommendations of Expert Committee on GAAR Accepted

The Central Government has carefully considered the report of the Expert Committee on General Anti Avoidance Rules (GAAR) and accepted the major recommendations of the Expert Committee with some modifications. This was announced by the Union Finance Minstar Shri P.Chidambaram here today in a press conference. The Finance Minister said that the following decisions have been taken by Government in this regard: (i)           An arrangement, the main purpose of which is to obtain a tax benefit, would be considered as an impermissible avoidance arrangement.  The current provision prescribing that it should be "the main purpose or one of the main purposes" will be amended accordingly.
(ii)          The assessing officer will be required to issue a show cause notice,containing reasons, to theassessee before invoking the provisions of Chapter X-A.
(iii)        The assessee shall have an opportunity to prove that the arrangement …

XBRL Date Extended upto 15-02-2013

General Circular number 01/2013 dated 15.01.2013
As per General Circular number01/2013 dated 15.01.2013, time limit to file financial statements inXBRL mode (for the financial year commencing on or after 01.04.2011) without any additional fee has been extended upto15th February´ 2013or within30 days of AGM of the company, which ever is later.

Assocham on IT re-assessment

Showing a grave concern over the fact that notices for reopening of assessments by the tax authorities are being issued in thousands in recent times, ASSOCHAM today said returns should not be re-opened beyond three years.

As Finance Minister P Chidambaram has started his pre-budget consultations with different stakeholders, the ASSOCHAM has submitted a detailed memorandum to the Finance Ministry seeking changes in Sections 147/148 of the Income Tax Act . These sections relate to the tax re-assessment on matters already examined or in a blanket manner.

"In recent times, tax reopening notices under sections 147/148 have become a very common occurrence and such notices are being served in thousands across the country, the ASSOCHAM memorandum said. It appears that there is no consideration in following the principles on the subject laid down by the Supreme Court and High Courts over the years, it added.
Simple audit observations, even on points of law, are frequently being used as grou…