Gist of latest important tax caselaws

SECTION 10(22)  
EDUCATIONAL INSTITUTIONS

Where assessee trust, running a school, collected excess fee in name of development fund which was not brought in its books of account, in view of fact that trust was established for benefit of children of managing trustee and, moreover, there was no obligation on its part to reinvest amount in question in educational activities, it was to be concluded that trust existed for profit motive and, therefore, assessee's claim for exemption of income under section 10(22) and 10(23C) was to be rejected - Assistant Commissioner of Income-tax, Central Circle, Kollan v. Sabarigiri Trust (2014) 43 taxmann.com 19 (Cochin - Trib.)

Below are the recent important tax caselaws related to Income tax, Service tax, Excise in brief. The citation is made available for your benefit :

INCOME TAX

SECTION 12AA

CHARITABLE OR RELIGIOUS TRUST - REGISTRATION PROCEDURE

Cancellation of registration : In terms of Circular No. 1/2011 dated 6-4-2011, registration already granted under section 12A can be cancelled only for assessment year 2011-2012 and subsequent assessment years; in instant case, assessment year involved being 2009-10, Assessing Officer could not cancel registration already granted to assessee-trust by taking a view that activities of trust were hit by proviso to section 2(15) - Prithviraj Kapoor Memorial Trust & Research Foundation v. Director of Income-tax (Exemption) (2014) 43 taxmann.com 20 (Mumbai - Trib.)     SECTION 37(1) BUSINESS EXPENDITURE - ALLOWABILITY OF Interest : Where assessee used borrowed funds for purpose of setting new project for expansion of its business, interest was to be allowed as revenue expenditure - Commissioner of Income-tax, Meerut v. Diwan Rubber Industries (2014) 43 taxmann.com 27 (Allahabad) SECTION 43B BUSINESS DISALLOWANCE - CERTAIN DEDUCTIONS TO BE ALLOWED ONLY ON ACTUAL PAYMENT Provident Fund contributions : Where employer did not deposit PF/ESI contribution within due date as contemplated under PF/ESI Scheme/Act, but deposited it before due date of filing return, assessee would be entitled to deduction - Essae Teraoka (P.) Ltd. v. Deputy Commissioner of Income-tax (2014) 43 taxmann.com 33 (Karnataka)       SERVICE TAX SECTION 65(69) TAXABLE SERVICES - MARKET RESEARCH AGENCY'S SERVICES Research on equity is a product research and is liable to service tax under Market Research Services - Kotak Securities Ltd. v. Commissioner of Service Tax (2014) 43 taxmann.com 164 (Mumbai - CESTAT) SECTION 65(90a) TAXABLE SERVICES - RENTING OF IMMOVABLE PROPERTY SERVICES Where assessee has been paying service tax on an activity for a subsequent period, it cannot contend, for earlier period, that very same activity was not a service but only a sale of goods - Shoppers Stop Ltd. v. Commissioner of Service Tax (2014) 43 taxmann.com 173 (Mumbai - CESTAT)