Acquisition of an apartment under a builder-buyer agreement wherein the builder gets construction done in a phased manner and the payments are linked to construction is a case of purchase and not construction of a new asset. The Tribunal held that even in a case where construction of new asset commenced before the date of […]
CO-OWNERSHIP AND EXEMPTION UNDER SECTION 54F
Individual or HUF assessee’s are exempted from payment of income tax on capital gains arising from the transfer of any long-term capital asset, (not being a residential house), u/s. 54F of the IT Act on the purchase or construction of a residential house within the specified period. The exemption is subject to fulfilment of the […]
PCIT VS. JAYA UDAY TULJAPURKAR [ITA 53 of 2017; dated 22nd April, 2019] (Bombay HC)]
Capital gains from sale of flat owned by a co-operative housing society on a piece of land which was granted under a long-term lease is eligible for deduction under section 54. Facts The father of the assessee was allotted a flat in a residential complex in a co-operative housing society. The complex was constructed on […]
SECTION 54F EXEMPTION WHEN ASSESSEE JOINTLY OWNS RESIDENTIAL HOUSE
Ashok G. Chauhan vs. ACIT [2019] 105 taxmann.com 204 (Mum) – Condition of not owning more than a residential house on the date of transfer of the original asset would mean absolute ownership. It does not cover within its sweep a case where the assessee jointly owns residential house together with someone else Facts The […]
PCIT VS. KHYATI REALTORS PVT. LTD. [ITA NO. 291 OF 2017; (BOMBAY HIGH COURT)]
Advance paid for booking commercial space in ordinary course of business, which becomes irrecoverable, is allowable as deduction Facts of the Case The assessee, a private limited company, had advanced a sum of Rs. 10 crores to Bhansali Developers for booking commercial space in an upcoming construction project. For some reason, the deal failed. The […]
SHANKARA INFRASTRUCTURE MATERIALS LTD. v. ACIT [2021] 130 taxmann.com 67 (Karnataka HC)
MTM loss incurred by assessee on account of foreign exchange fluctuations on working capital loan with foreign currency swap option for business purpose is to be allowed as deduction under section 37(1) FACTS The assessee was a company engaged in business of trading steel tubes, pipes, PVC etc. The assessee filed its ITR on 23-9-2008 […]
UOI v EXIDE INDUSTRIES LIMITED (2020) 5 SCC 274; [2020] 116 taxmann.com 378 (SC)
The High Court at Calcutta in Exicle Industries Ltd. v. Union of India [2007] 164 Taxman 9/292, held that the section 43B(f) is arbitrary and violative of article 14 of the Constitution of India on various counts. Before SC, the constitutional validity of Section 43B(f) was to be considered. Clause (f) was inserted in the […]
CIT v. RELIANCE ENERGY LTD – [2021] 127 taxmann.com 69 (SC)
In a recent decision, the Supreme Court allowed deduction under section 80IA from gross total income, which included other income and rejected the action of AO of restricting the deduction to ‘business income’ only. The decision is analysed below. Facts The Assessee is engaged in the business of power generation and also deals with purchase […]
SECTION 64 CLUBBING – WHETHER GROSS OR NET INCOME TO BE CLUBBED
Income-tax is a charge on every person’s income of the previous year to be levied and computed in accordance with the provisions of the Income-tax Act. Section 64 of the Act provides that income of individuals will also include income of spouse, minor child, etc in certain circumstances. A question that arises is whether at […]