Income Tax Act Doesn't Mandate That Specific Money Deposited In Capital Gain Account Scheme Shall Be Utilized Towards New Investment: Chennai ITAT
10 months, 3 weeks ago

Income Tax Act Doesn't Mandate That Specific Money Deposited In Capital Gain Account Scheme Shall Be Utilized Towards New Investment: Chennai ITAT

Live Law  

The Chennai ITAT held that there is no requirement that specific money as deposited in capital gain account scheme should be utilized towards new investment, and the assessee may make investment from other funds as available with him and the same would not jeopardize the claim of the assessee. Referring to the decision of Sohanlal Mohanlal Bhandari vs. ACIT, the Bench of Mahavir Singh And Manoj Kumar Aggarwal reiterated that “it is open for the assessee to use either own or borrowed funds for purchase or construction of new residential house and it is nowhere provided that only sale proceeds of original asset should be utilized for this purpose”. As per the brief facts of the case, the assessee has deposited the sale consideration in capital gain account scheme which was withdrawn. The assessee did not purchase new asset within a period of one year prior nor constructed new asset within a period of three years as stipulated.

Construction Bench One Year Itat Assessee New Asset  assessee  agreement  tax  construction  scheme  asset  period  shall  mandate  specific  investment  sale  original  prior  itat  money  utilized  income  stipulated

History of this topic

[Income Tax Act] Placing Funds In One Account Before Transferring It To Another Does Not Attract S. 69A: Allahabad High Court
3 months, 2 weeks ago

[Income Tax Act] Placing Funds In One Account Before Transferring It To Another Does Not Attract S. 69A: Allahabad High Court

Live Law  

The Allahabad High Court has upheld the finding of the Income Tax Appellate Tribunal and Commissioner of Income Tax that when an agreement between parties specifies a direct transfer of money, doing so indirectly by keeping the funds in a distinct account before sending them to the final account, does not place the money under the definition of 'unexplained money' …

AO Must Pass Draft Assessment If He Proposes Variation In Returned Income: Chennai ITAT Explains Scope Of Sec 144C
8 months, 1 week ago

AO Must Pass Draft Assessment If He Proposes Variation In Returned Income: Chennai ITAT Explains Scope Of Sec 144C

Live Law  

The Chennai ITAT held that the AO must pass a draft assessment order to the eligible assessee in case he proposes to make any variation in the income or loss returned which is prejudicial to the interest of such assessee. Section 144C of the Income Tax Act provides that in case of certain eligible assessees, viz., foreign companies and any …

AO Can't Make Additions Solely Based On Retracted Statement Of Third-Parties If Assessee Has Claimed Opposite: Chennai ITAT
8 months, 1 week ago

AO Can't Make Additions Solely Based On Retracted Statement Of Third-Parties If Assessee Has Claimed Opposite: Chennai ITAT

Live Law  

Referring to the decision of Madars High Court in case of P.V. Going further, the Bench held that the AO cannot make additions solely based on retracted statement of third-parties, if assessee had claimed otherwise. In his statement, R. Sabapathy deposed that cash loans were taken by him to pay for the purchase of immoveable properties at Perambur, which was …

Assessee Has Not Benefited From Round-Tripping Of Share Transactions; Mumbai ITAT Deletes Addition U/s 68
10 months, 3 weeks ago

Assessee Has Not Benefited From Round-Tripping Of Share Transactions; Mumbai ITAT Deletes Addition U/s 68

Live Law  

On finding that the assessee has issued share application money and subsequently allotted shares which shows that the transactions are genuine and there is no material brought on record by tax authorities that the assessee has benefited from round-tripping, the Mumbai ITAT deleted the addition made u/s 68 of the Income Tax Act, 1961. The Bench of the ITAT comprising …

Section 54 Deduction Can't Be Disallowed Merely For Not Depositing LTCG In Capital Gain Account Scheme: ITAT
1 year, 3 months ago

Section 54 Deduction Can't Be Disallowed Merely For Not Depositing LTCG In Capital Gain Account Scheme: ITAT

Live Law  

The Delhi Bench of Income Tax Appellate Tribunal has held that deduction under Section 54 of the Income Tax Act cannot be disallowed merely for not depositing long-term capital gain that was not deposited in the capital gain account scheme.The bench of Saktijit Dey and M. Balaganesh has adopted a hyper-technical approach while dealing with. The Delhi Bench of Income …

ITAT Upholds Addition On Account Of Unexplained Cash Deposit Made During Demonetisation
1 year, 8 months ago

ITAT Upholds Addition On Account Of Unexplained Cash Deposit Made During Demonetisation

Live Law  

The Chennai Bench of the Income Tax Appellate Tribunal, while rejecting the plea of the assessee for cash received in marriage, upheld the addition on account of an unexplained cash deposit made during demonetisation.The bench of Mahavir Singh and Manoj Kumar Aggarwal has observed that there is no direct evidence available from the assessee. The Chennai Bench of the Income …

Purchase Of New House Without NOC From AO Within 2 years: ITAT Allows Capital Gain Exemption
2 years, 7 months ago

Purchase Of New House Without NOC From AO Within 2 years: ITAT Allows Capital Gain Exemption

Live Law  

The Income Tax Appellate Tribunal, Delhi Bench has held that the capital gain exemption is allowable even when the amount invested in a capital gain account is utilised for the purchase of a new house without a NOC from AO within 2 years. The assessee has derived income from house property, capital gains, and income from other sources. The AO …

Expenditure Incurred After Set-Up of Business Is Allowable As Deduction, Even If No Business Income Is Earned By The Assessee : ITAT Chennai
2 years, 8 months ago

Expenditure Incurred After Set-Up of Business Is Allowable As Deduction, Even If No Business Income Is Earned By The Assessee : ITAT Chennai

Live Law  

The Chennai Bench of ITAT has ruled that once the business of an assessee is set-up, all the expenditure incurred by it would be allowable as deduction, notwithstanding the fact that no business income was earned by the assessee during the relevant year. The assessee RBL Hotels submitted before the ITAT that it had duly set-up its business during the …

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