Direct Tax case laws update.

 

·         The Bombay High Court has heavily criticized the Income Tax Department for not being transparent with taxpayers in sharing the requested information basis of reopening action 

 

·         The Cochin bench of the ITAT has held that the carry forward of business loss cannot be denied to the assessee merely on the ground that the statutory audit/tax audit was not completed within the prescribed period

 

·         ITAT Bangalore bench has held that the expenditure allowed for corporate social responsibility (CSR) of the assessee shall be allowed as business expenditure under section 37(1) of the Income Tax Act, 1961.

 

·         The Mumbai bench of the ITAT has held that the interest received on loan given to the related party for business purpose cannot be subjected to provisions of section 40A(2)(b) of the Income tax Act, 1961.

 

·         The Supreme Court (SC) has held that for granting the exemption based on the nature of the agreement, the said agreement should be read as a composite whole. The SC viewed that just because the agreement contained a provision for payment on rate basis, it would not make it a job work agreement and mentioned that crucial elements of a job work agreement were missing in the said agreement. Accordingly, it was opined that the contract is a pure and simple contract for the provision of contract labour and an attempt has been made to camouflage it as a contract for job work.