Imp Judgements.

 

THE Mavilayi Service Coop Bank Ltd vs. CIT (Supreme Court)

The three judges bench of Apex Court in the above matter was dealing with the issue regarding eligibility of the assessee to get deduction u/s 80P of the Income-tax Act 1961 in view of restrictions placed in Section 80P(4) of the Income-tax Act,1961 which provided that the provisions of this section shall not apply in relation to any co-operative bank other than a primary agricultural credit society or a primary co-cooperative agricultural and rural development bank. The Court noted its own decision in the case of *Citizen Co-operative Society [397 ITR 1] * by stating that It is settled law that it is only the ratio decidendi of a judgment that is binding as a precedent . Thereafter it observed that section 80P of the IT Act is a benevolent provision, which was enacted by Parliament in order to encourage and promote the growth of the co-operative sector generally in the economic life of the country and must, therefore, be read liberally and in
favour of the assessee. The court also relied upon the heading of the section by saying that the marginal note to Section 80P which reads “Deduction in respect of income of co-operative societies” is important, in that it indicates the general “drift” of the provision. Finally the court held that in the instant case the assessee was eligible to get the deduction u/s 80P of the Act by allowing the appeal.

This judgement will be helpful from interpretation points of view as several interpretational aspects have been dealt with in addition to deciding the interpretation of Section 80P.

 

Ireo Grace Realtech Private Limited Vs Abhishek Khanna (Supreme Court)

Issue-Whether one sided terms and conditions in the agreement for sale of flat amounts to unfair trade practice? The apex court held that the incorporation of one-sided and unreasonable clauses in the Apartment Buyer‘s Agreement constitutes an unfair trade practice under Section 2(1)(r) of the Consumer Protection Act. and held that the Developer cannot compel the apartment buyers to be bound by the one-sided contractual terms contained in the Apartment Buyer‘s Agreement. Among other issues the court decided that a disgruntled flat buyer had an option under the RERA as well as consumer protection act. An allottee may elect or opt for one out of the remedies provided by law for redressal of its injury or grievance. An election of remedies arises when two concurrent remedies are available, and the aggrieved party chooses to exercise one, in which event he loses the right to simultaneously exercise the other for the same cause of action.

 

Storewell Construction & Engineers Vs Pr. CIT -2 (ITAT Pune)

Pune ITAT held that the Commissioner of Income Tax is not empowered to invoke the revisionary jurisdiction u/s.263 of the Income Tax Act to look into the other issues relating to the assessee which were not within the purview of the limited scrutiny. The CBDT Circular vide its letter F-No.225/26/2006-ITA-II (Pt.), 8th September, 2010 has described the procedure for handling limited scrutiny cases wherein the Assessing Officer shall remain confined only to the specific reasons/issues for which case has been picked up for scrutiny. In this case, the Assessing Officer has already verified those issues for which limited scrutiny was conducted. The Ld. Pr. Commissioner of Income Tax wants the Assessing officer to look into various other issues of the assessee which were not covered within the purview of the limited scrutiny. This is not permitted within the framework of the Income Tax Act. Therefore, revisionary order u/s 263 quashed.

 

DCIT vs. Runwal Multihousing Pvt Ltd (ITAT Pune)

The assessee was initially following the Percentage completion method by showing income on the basis of percentage of work done. In contrast, the project completion method, which is an equally recognized method, mandates the determination of income at the time of completion of project. Both the methods are recognized methods. Whereas, in the first method, profit is considered on a year to year basis parallel with the progress of construction, in the latter, profit is considered when the project is completed. Under both the methods, the amount of income remains unchanged except for the effect that the profit shifts from one year to another. The assessee switched over from the Percentage completion method to the Project completion method by filing a revised return. Once it is seen that the assessee switched over from the Percentage completion method to the Project completion method in a bona fide manner and continued with the changed method in the years to come, it is allowed.