INCOME TAX REGULATORY UPDATES NOV 2022
INCOME TAX REGULATORY UPDATES NOTIFICATION NO. 112/2022, DATED 07-10-2022
CBDT amends definition of ‘non-re- porting financial institution’ for purpose of reporting under FATCA Editorial Note : The Central Board of Direct Taxes (CBDT) has amended the definition of ‘non-re- porting financial institution’ as defined under Rule 114F. Section 285BA talks about reporting requirements by a “non-reporting financial institution” that is responsible for registering, maintaining books of account or other documents containing a record of any reportable account.
NOTIFICATION NO. S.O. 4873(E), DATED 13-10-2022
CBDT specifies jurisdiction of CIT(A) for filing faceless appeals for cases related to International Tax & TP
Editorial Note : The Central Board of Direct Taxes (CBDT) has specified the jurisdiction of the Commission of Income-tax (appeals) for filing of appeal the Faceless Appeal Scheme, 2021 for casesrelatedtoInternationalTax& Transfer Pricing.
CIRCULAR NO. 21/2022, DATED 27-10-2022
CBDT extends due date of filing of TDS return for 2nd quarter of FY 2022-23 to November 30, 2022
Editorial Note : On account of the revision of the format of Form 26Q and the consequent updating required for its filing, the Central Board of Direct Taxes (CBDT) has extended the due date of filing of TDS statement for the second quar- ter of the financial year 2022-23 from October 31, 2022, to November 30, 2022
CIRCULAR NO. 22/2022, DATED 01-11-2022
CBDT condones delay in filing of Form 10A which was required to be e-Filed by March 31, 2022
Editorial Note : The CBDT has condoned the delay up to
25-11-2022 in the filing of Form no. 10A which was required to be filed electronically on or before 31-03-2022. The Form 10A is required to be filed for re-registra- tion of existing trust registered u/s 12A/12AA, for re-approval of exist- ing trust or institution approved u/s 10(23C)/80G and for filing of intimation by a research association or institution u/s 35.
NOTIFICATION F. NO.
370133/16/2022-TPL, DATED
01-11-2022
CBDT proposes common ITR by merging all existing forms except ITR-7; releases draft ‘Common ITR’
Editorial Note : The CBDT has proposed to introduce a common ITR by merging all the existing returns of income except ITR-7. This will give an option to taxpay- ers to file the return either in the existing form or the proposed common ITR, at their convenience.
RECENT JUDICIAL RULINGS ON INCOME TAX SECTION 2(41) OF THE INCOME-TAX ACT, 1961 – RELATIVE
Nephew : Term ‘relative’ defined under section 2(g) of Senior Citizen’s Act could not be read at
par with section 2(41) of IT Act for purpose of allowing exemption on gifts received by assessee – Miss Indira Uppal v. Union of India – [2022] 143 taxmann.com 239 (Delhi).
SECTION 32 OF THE INCOME TAX
ACT, 1961 – DEPRECIATION – ALLOWANCE/RATE OF
Even if Schedule DEP in ITR is not filled up, depreciation to be allowed by CPC as per figure indicated in Part A- P&L in ITR & clause 18 of TAR – Indauto Filters v. Assistant Director of Income-tax, CPC – [2022] 144 taxmann.com 3 (Ban- galore – Trib.)
SECTION 35 OF THE INCOME-TAX
ACT, 1961 – SCIENTIFIC RESEARCH EXPENDITURE
Reassessment : Where Assessing Officer issued a reopening notice for examining expenses incurred by asses- see on scientific research and develop- ment and expenses related to purchase of unprocessed seeds, since these issues were already considered by Assessing Officer during scrutiny assessment and claim of assessee was allowed after detailed investigation by raising queries and considering reply and supporting materials submitted by assessee, impugned reopening was unjustified – Florence Investech Ltd. v. Deputy Commissioner of Income-tax – [2022] 143 taxmann.com 217 (Calcutta)
SECTION 36(1)(ii) OF THE INCOME-TAX ACT, 1961 – BONUS OR COMMISSION Bonus/commission paid to employee who is not a part- ner/shareholder can’t be disallowed u/s 36(1)(ii) – Karam Singh Malik v. Income Tax Officer, Ward-44(4) – [2022] 144 taxmann.com 5 (Delhi – Trib.)
SECTION 37(1) OF THE INCOME TAX ACT, 1961 – BUSINESS EXPENDITURE – ALLOW ABILITY OF
Mere disclosure of club fees in clause 21(a) of Tax Audit Report does not per se render them liable to be disallowed u/s 37(1) – Legacy Global Projects (P.) Ltd. v. Assis- tant Director of Income-tax – [2022] 144 taxmann.com 4 (Bangalore – Trib.)
SECTION 92C OF THE INCOME-TAX ACT, 1961 – TRANSFER PRICING – COMPU- TATION OF ARM’S LENGTH PRICE
Comparables, functional similarity – Software consultancy/Development services : Where selected company
was engaged in development of products, in absence of segmental information, it could not be com- pared with assessee-company rendering software development services – Income-tax Officer v. Nethawk Networks India (P.) Ltd. – [2022] 143 taxmann.com 213 (Pune – Trib.)
SECTION 94B OF THE INCOME TAX ACT, 1961 – INTEREST DEDUCTION IN CERTAIN CASES – LIMITATION ON
Under mercantile system, premium payable on redemption of prefer- ence shares does not accrue to shareholder every year like interest – Enzen Global Solutions (P.) Ltd. v. Income Tax Officer, Ward-2(1)(4) – [2022] 144 taxmann.com 2 (Bangalore – Trib.)
SECTION 260A OF THE INCOME TAX ACT, 1961 – HIGH COURT – APPEAL TO
HC can dismiss a WP on the grounds of availability of alternative remedy. even after its admission – MangaliMahinag v. Sushila Sahu – [2022] 144 taxmann.com 6 (Chhattisgarh)
SECTION 271(1)(b) OF THE INCOME-TAX ACT, 1961 – PEN- ALTY – FOR NON-COMPLIANCE OF NOTICES
Illustrations : Where during reassess- ment proceedings, penalty was levied under section 271(1)(b) for non-compli- ance of notice under section 142(1), since quantum reassessment proceed- ings itself were held to be without juris- diction and were quashed, consequent penalty proceedings initiated for non-compliance of notice were also to be quashed – Smt. Anita Awasthi v. Income-tax Officer – [2022] 143 taxmann.com 238 (Varanasi-Trib)
SECTION 276CC OF THE INCOME-TAX ACT, 1961 – OFFENCE AND PROSECUTION – FAILURE TO FURNISH RETURN OF INCOME
Condition precedent : Where admittedly department had not obtained prior sanction from Pr. Commissioner under section 279 to proceed against asses- see-director for filing belated return by company, department could not proceed against assessee so as to prosecute him for offence under section 276CC – Vipul Aggarwal v. Income-tax Officer – [2022] 143 taxmann.com 237 (Delhi)
Recent Comments