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Monday, July 25, 2022
Non disclosure of  Foreign assets or exempt income in ITR

Non disclosure of  Foreign assets or exempt income in ITR

  • There are various Incomes which are exempted from the levy of income tax in the hands of the person who is receiving the amount. Not disclosing the exempt Income in ITR is not the correct manner to file an Income Tax Return and this may have some consequences. These Incomes are required to be disclosed in Schedule EI in the Income Tax Return (ITR).

  • Mere non-disclosure of exempt income in ITR wouldn't amount to escaped income  - (ACIT v. Swastic Safe Deposit and Investments Ltd. - [2020] 118 taxmann.com 94 (SC))

  • The assessee, out of ignorance or inadvertence has omitted to mention the details of exempt income in the relevant ‘Schedule EI’. So, the ignorance of the assessee or inadvertent mistake committed by the assessee should not come in his way in claiming exemption, which is otherwise allowable under the Act.(Goodwill Management Pvt. Ltd. Vs DCIT (ITAT Bangalore) Appeal Number : ITA No. 670/Bang/2020)

  • 4. Mere non-disclosure of a foreign asset in the income tax return, by itself, is not a valid reason for a penalty under the Black Money Act, if the source of investment is well explained by the assessee.Unless there are sufficient prima facie reasons to at least doubt the bonafides well demonstrated by the assessee, an assessee cannot be visited with penal consequences. The bona fide actions of the taxpayers must, therefore, be excluded from the application of provisions of such stringent legislation as the BMA.Additional Commissioner of Income Tax Central Range 1, Mumbai Versus Leena Gandhi Tiwari (29 March, 2022)

  • AO’s order imposing penalty under sec. 270A is appealable before CIT(A):
    Section 246A(1)(q) specifically includes “an order imposing a penalty under chapter XXI”. Chapter XXI of the Income Tax Act, 1961 covers Sections 270 to 275. Thus, Section 270A dealing with underreporting and misreporting of income is duly covered.Therefore, the appeal against an order imposing penalty under section 270A, as passed by the AO, is appealable before the Commissioner (Appeals).

  • No concealment penalty even for not disclosing income in ITR if shown in balance sheet - Assessee, in the instant case, has not concealed the income deliberately (particularly in the light of the fact that advances have been shown in the balance sheet filed even along with the original return) and therefore, is not liable for imposition of penalty under Section 271(1)(c) of the IT Act. PCIT Vs Trisha Krishnan (Supreme Court),01/04/2019

  • As far as imposition of penalty under the IT Act is concerned, there is a legal presumption against Assessee and it is for the Assessee to prima facie show bonafides in that regard. The moment the Assessee shows the same, the onus shifts to the Revenue to establish that the concealment was deliberate and willful.

  • 8. Penalty will not be imposed merely because it was lawful to do so. Whether penalty should be imposed for failure to perform a statutory obligation is a matter of discretion of the authority to be exercised judiciously and on consideration of all the relevant circumstances.

Wednesday, March 15, 2017
Quick Updates

Quick Updates

  • Cretificate for lower TDS 'Person specific and not income specific
  • Cretificate for lower TDS ‘Person specific’ and not ‘Income specific’
  • Shri G.D Aggarwal appointed as President of ITAT
  • Interest earned by Mauritius Bamk from Indian securities is exempt in India
  • No section for 54F relief if newly aquired house is instantly demolished
  • RBI allows NRIs to invest in exchange-traded currency derivatives
  • Furnishiung of Aadhar is mandatory for final settlement of Pension calimes
CBEC launches mobile application for GST

CBEC launches mobile application for GST

In step with the goernment's Digital India Initiative, the Central Board of Excise and Customs (CBEC) has launched a mobile applicatrion for 'Goods And Service Tax'.Taxpayers can readily access a host of GST information such as:
  • Migrations to GST-Approach and guidelines for migration
  • Draft Law-Model GST law, IGST law and GST compensation law
  • Draft Rules-Rules related to registeration, returns, payment, refund and invoice
  • Frequently Asked Questions (FAQs) on GST
  • Various resources on GST such as videos, articles etc.
  • Related website links
Labelling and packing of handmade 'Biri' in plastic wrappers isn't manufacturing: Calcutta HC

Labelling and packing of handmade 'Biri' in plastic wrappers isn't manufacturing: Calcutta HC

The High Court of Calcutta held that labelling and packing of handmade biri in printed plastic wrappers with aid of power operated machine to bring into existence retail pack would not come within purview of 'manufacture'.
Deputy Commissioner of Central Excise, Siliguri v. Kishan Biri Mfg. Co.* [2017] 78 taxmann.com 167 (Calcutta)
Upgradation of aircrafts to be treated as manufacturing activity, not liable to Service Tax

Upgradation of aircrafts to be treated as manufacturing activity, not liable to Service Tax

The CESTAT, Allahabad Bench held that activities to upgrade aircrafts being manufacturing activities, is not 'maintenance and repair services'.
Hindustan Aeronautics Ltd. v. Commissioner of Central  Excise, Kanpur* [2017] 78 taxmann.com  68 (Allahabad - CESTAT)
SIM Card replacement charges are liable to service tax and not VAT: Madhya Pradesh HC

SIM Card replacement charges are liable to service tax and not VAT: Madhya Pradesh HC

The High Court of Madhya Pradesh held that where assessee provided various kinds of telecom services such as cellular, fixed line and broadband services and paid service tax thereon, levy of VAT on SIM card replacement charges and lease line charges received by assessee from subscribers not justified.
Idea Cellular Ltd. v. Assistant Commissioner of Commercial Tax, LTU, Indore* [2017] 78 taxmann.com 106 (Madhya Pradesh)
Leasing of earthmoving equipment would attract VAT and not service tax

Leasing of earthmoving equipment would attract VAT and not service tax

The CESTAT, Mumbai Bench held that assessee was engaged in renting of earthmoving equipments and terms and conditions stipulated in agreement entered into between assessee and lessor led to conclusion that transaction envisaged in agreement was one of transfer of right to use goods, assessee's activity of giving equipments on hire did not fall under category of 'supply of tangible goods for use'
Gimmco Ltd. v. Commissioner of Central Excise & Service Tax, Nagpur* [2017] 78 taxmann.com 30 (Mumbai - CESTAT)
Services Tax exempted on services

Services Tax exempted on services

Services by way of carrying out,-
  • Any process amounting to manufacture or production of goods excluding alcoholic liquor for human consumption; or 
  • Any intermediate production process as job work not amounting to manufacture or production in relation to specified cases 
  • Process amounting to manufacture or production of goods" means a process on which duties of excise are leviable.