Bombay HC allows Tata Teleservices (Maharashtra) Limited’s (‘assessee’) writ, quashes order of TDS authorities cancelling Sec. 197 certificate of nil deduction of tax issued to assessee, takes note of reason for cancellation viz. outstanding demand and deteriorating financial condition of assessee which can affect recovery; Relies on co-ordinate bench ruling in Larsen & Toubro Ltd. and SC ruling in Liberty Oil Mills to hold that Sec. 197 does not do away with requirement of issuing a reasoned order while issuing a Certificate u/s 197, observes that Revenue failed to counter its prima facie view that “the absence of the order leading to the grant of the certificate being given to the Petitioner, leads to an adverse inference against the Revenue i.e. all issues including Rule 28AA (2) of the Rules were considered …”; Holds cancellation order to be non-speaking, observes that requirement of natural justice was not met and assessee was provided no opportunity to seek copy of reasons recorded while issuing the certificate, further notes that there was no change in facts from time of issue till time of cancellation which can justify cancellation; On merits, notes that assessee had accumulated losses of Rs. 4,900 Cr and there is no likelihood of any tax being payable in subject AY, further demand pending against assessee (Rs 6.9 Cr) can be adjusted against refund due to it pursuant to favourable ITAT order; Also rejects Revenue’s stand that an equally efficacious alternative remedy u/s. 264 by way of a Revision to CIT was available to assessee, notes that cancellation order was issued with the concurrence of CIT (TDS), therefore the Revision in present case i.e. alternative remedy would in fact be from ‘Caesar to Caesar’ and hence would be a futile/empty formality:HC
SC : Approves Bombay HC ratio in Godrej and Boyce on prospective applicability of Rule 8D
SC dismisses Revenue’s appeal in a batch of over 80 cases (involving Essar Teleholdings Ltd. as a lead case), holds that “the Rule 8D is prospective in operation and could not have been applied to any assessment year prior to AY 2008-09.”; Bombay HC, while dismissing Revenue’s appeal in Essar Teleholdings case, had relied on its coordinate bench ruling in Godrej and Boyce wherein Rule 8D was held to be prospective; SC rules that “Applying the principles of statutory interpretation for interpreting retrospectivity of a fiscal statute and looking into the nature and purpose of subsection (2) and subsection (3) of Section 14A as well as purpose and intent of Rule 8D coupled with the explanatory notes in the Finance Bill, 2006 and the departmental understanding as reflected by Circular dated 28.12.2006, we are of the considered opinion that Rule 8D was intended to operate prospectively.”:SC
Tax Due Dates – February 2018.
| Sr No | Due Date | Related to | Compliance to be made |
| 1 | 04.02.2018 | SEZ Compliances | Monthly Exemption details for the month of January 2018 |
| 2 | 10.02.2018 | GST | Filing of GSTR 1 for the month of December, 2018 |
| 3 | 20.02.2018 | GST | Payment of GST for the month of January, 2018
Filing of GSTR 3B for the month of January, 2018 |
| 4 | 07.02.2018 | TDS/TCS
(Income Tax) |
· Deposit TDS for payments of Salary, Interest, Commission or Brokerage, Rent, Professional fee, payment to Contractors, etc. during the month of January 2018.
· Deposit TDS from Salaries deducted during the month of January 2018 • Deposit TCS for collections made under section 206C including sale of scrap during the month of January 2018, if any |
E-way bill mandatory for intra-State movement in 13 States from February 1
3 States set to introduce E-Way Bill for intra-state movement w.e.f. February 1, 2018 in addition to mandatory E-Way Bill for inter-state movement; These States are Andhra Pradesh, Arunachal Pradesh, Bihar, Haryana, Jharkhand, Karnataka, Kerala, Puducherry (UT), Sikkim, Tamil Nadu, Telangana, Uttar Pradesh & Uttarakhand : CBEC
No E-Way Bill for intra-State goods movement till May 30, notifies Goa Govt.
Goa Govt. notifies that no E-Way Bill may be generated in respect of intra-State movement of any goods, where the movement commences and terminates in the State on or before May 30, 2018 : Goa Govt. Notification
Software taxability matter posted for March hearing; Revenue to serve notice
SC posts cross appeals of several taxpayers and Revenue on the issue of software taxability for hearing in March; SC instructs Revenue to serve notices as regards its appeals against HC judgements; Revenue also given liberty to submit written pleadings even as assessees’ counsels inform the Court that they have already filed their written submissions; Case to now come up on March 13th
HC : Quashes CHA license suspension absent initiation of recovation proceedings within prescribed timeline
HC sets aside suspension of custom broker’s license under Regulation 19 of Customs Brokers Licensing Regulations, 2013 (CBLR) for non-initiation of further proceedings within time period prescribed under Regulation 20 for revocation or imposition of penalty; Accepts assessee’s plea that order of suspension is an interim order which cannot continue indefinitely and Revenue is required to take a final view after following procedure contained under Regulation 20 within stipulated timelines; Rejecting Revenue’s contention that timelines had not yet commenced since ‘offence report’ had not been generated nor any show cause notice issued, HC remarks that letter indicating detection of an offence which triggered action against assessee must be considered as an “offence report” and a notice ought to have been issued within a period of 90 days therefrom; Perusing various clauses of Regulation 20, HC holds that Commissioner is required to pass final order regarding revocation of license or termination of proceedings within a period of 270 days from receipt of offence report; Elucidates that, “The rationale of providing strict timelines is to ensure that the work of the Customs Broker is not suspended indefinitely and any action against him is concluded in the time bound manner…interpretation that the License of a Custom Broker can be suspended without immediately following the same proceedings under Regulation 20(1) of the CBLR would defeat the very objective for which such strict timelines have been provided” : Delhi HC
Failure to establish with necessary evidence regarding transportation of goods can lead to addition in assessee’s income on account of purchases made from grey market: ITAT
THE issue before the Bench is – Whether purchases made from grey market can be added to assessee’s income, if assessee fails to establish necessary evidence for transportation of goods. And the ITAT verdict is YES.
Power of revision can be exercised u/s 263 where particular issue is not examined in its entirety by AO: HC
THE issue before the Bench is – Whether power of revision can be exercised u/s 263 where a particular issue is not examined in its entirety by the AO, during original assessment proceedings. And the HC verdict is YES.
ITAT : Disapproves CBDT Instruction terming MTM loss as notional, cites Delhi HC ICDS ruling
Agra ITAT holds that losses arising to assessee-individual on account of trading in currency derivatives, neither speculative nor notional, allows set-off against other business income for AYs 2013-14 and 2014-15; Firstly, observes that derivative transactions entered by assessee meet all the conditions laid down under clause (d) of Sec. 43(5) and thus, qualify as transactions not deemed to be ‘speculative transactions’; Holds that CIT(A) erred in treating the entire loss as notional loss without looking at the position held by assessee at the close of the financial year, notes that only one series out of the 7 series of contracts remained unexpired as on the end of FY 2012-13 while all stood settled at the end of FY 2013-14; Further holds that CBDT instruction No 3/2010 which terms marked to market loss as notional, is not in accordance with law, observes that “though the reasoning of the Board to term the loss on account of ‘mark to market’ transactions, as contained in Instruction no. 3/2010, was disapproved by the Courts, it resurfaced in the ICDS”; Cites Delhi HC ruling in Chamber of Tax Consultants striking down ICDS I (to the extent it does not recognize expected losses and marked-to-market losses), HC had also held that non-acceptance of the concept of prudence in ICDS I is per se contrary to the provisions of the Act and therefore, cannot be countenanced:ITAT
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