Wednesday, May 14, 2014

A Revisit ? Sec 271 (1)(c), PAN vs TDS, Service tax, et al

Aug 23

Penalty cannot be levied merely because an amount is not allowed or taxed as income

<> The acid test as propounded in the cited leading court cases, rightly so, and relied upon and followed by the ITAT, Delhi, again equally rightly, is that , – should  “just and cogent reason” be  given in a case on hand  there could be no levy “merely because the assessee’s claim was not accepted or was not acceptable to the revenue”. Well, the legality or soundness of the underlying principle of the stated proposition, in one’s conviction, is unassailable. Nonetheless, in each and every such case, to be fully satisfied,- purely from an ‘objective’ viewpoint,- whether or not the other largely accepted test of justice having been done , must  also be seen to have been done, for several attendant reasons, may prove an onerous exercise. In other words, the dispute may not necessarily get settled at the last fact finding stage of ITAT but may be dragged on to courts on the ground of a ‘substantial question of law’.
That is an aspect requiring to be considered in-depth and needs to be covered suitably by either (a) legislating levy of ‘interest’ and at a reasonably acceptable rate (same as done in certain other contexts such as, late filing of return, non-payment of tax due), in place of the extant provision for ‘penalty’, and /or (b) have covered cases in which the additional burden is significant or not insignificant, under the scheme of “dispute resolution”. That could, perhaps, pave the way for mitigation of or prolongation of litigation, as may be imagined, to a considerably desirable extent.
To make it explicit, the thoughts tried to be shared are off hand; might nonetheless be given a closer look -through , if found worth a serious examination, before deciding to accept and go ahead.

No penalty U/s. 271(1)(c) for mere for failure to compute capital gains as per Section 50C

S. 271(1)(c): The giving up of a bogus claim for deduction to eschew inquiry by AO/ TPO is not voluntary & bona fide & attracts levy of penalty

Note: While dealing with a stay petition in the same matter (351 ITR 160), the High Court had observed that the assessee had a “strong prima facie case

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The Hindu (Tamil)

பிரதமர் அலுவலக ட்விட்டர் கணக்கு மாற்றப்பட்டதால் சர்ச்சை  

பசித்தவன் பழைய கணக்கு பார்த்தான் என்பதும் அதனால் இப்பூவுலகில் பலன்தான் என்னே என்பதும்- கருத்து வேற்றுமை க்கும் சர்ச்சைக்கும் 'இயல் அறிவு ' ( common sense) பூர்வமாக உகந்ததா என்பதே அடிப்படை சர்ச்சை போலும் ! இது மிக்க அவசியம்தானா என்பதே மற்றுமொரு கேள்வி-சர்ச்சைக்கு உரியது தானே ? சுயஅறிவு மட்ட சர்ச்சை என்பது கிணறு அல்லது ஊரோரகுட்டை அளவு ; அறிவின்மை என்பது பரந்த கடல் அல்லது விண்வெளி அளவு அல்லவா ? மூச்சு உள்ளளவும் சர்ச்சைக்குதான் எல்லைஉண்டொ ?


எது சரி எது தவறு என்பது மானுடனுக்கு மானுடn வேறுபடும். சர்ச்சையும் சண்டையும், அதுவும் அல்ப சங்கதிகளிலும், தவிர்க்க இயலாதது . தெரிந்தது கையளேவே என்கிற உலக நியதி புரியாத வரை , மானுடனின் இரண்டாவது இயற்கை (second nature) கடவுளே தந்தது ,அவராலும் மாற்ற இயலாதது தானே ?!

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 Mothers name on PAN card – New Form 49A & 49AA WEF 16.05.2014

At the first blush, the announced change in the requirement  does not seem to have any rhyme or reason behind ;  possibly, it is merely one of those not-unfamiliar changes of the kind, conceived of impulsively, with no provocation whatsoever or a serious demand from any quarters. 
In a lighter vein, however, being tempted to recall: Tax return of a non-resident corporate, prepared by his consultant in India, sent for verification and signature, came to be returned for filing with no mention of   father's name of signatory - director,- but left blank. When diligently followed up by a rejoinder, pat came a reply from an obviously annoyed client, to the effect : Why the hell the Revenue would at all want to know  much less can insist for the info. ; leaving it to consultant's wild guess what really could have been the assessee's problem / reservation behind !

Incidentally, as is known, for issuance of a Passport, historically, applicant is mandated to specify mother's name (not father's !).

Thus the whole topic is inevitably surrounded and riddled with  imponderables ?

key note: 
 [Notification No. 26/2014] [F.No.142/15/2013-TPL]
[Ashis Mohanty]
Under Secretary to Government of India
Note: – The principal rules were published vide Notification S.O. 969 (E), dated 26th March, 1962 and last amended by Income-tax (4th Amendment) Rules, 2014 vide Notification S.O. 997 (E), dated the 1st April, 2014.

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< The newly mooted idea cannot at all be regarded as deserving any accolade, much less as  a commendably brainy  step to prove effective for accomplishing the underlying objective.  For, that by itself, can perceptibly or imaginably serve no useful purpose ; or be sanely expected to bringing about any desirable improvement in the disgustingly long obtaining field reality.

It is incumbent on, besides, the BCSBI,  also the others namely the RBI , in intimate consultation with the concerned law and finance ministries, to devoutly try and come to rescue, through bringing in and successfully implementing really helpful measures ; that is, think beyond the simplistic step of  'rankings', which, at best, is a wasteful exercise / sheer paper work and nothing beyond.


Builders, Wake Up & Smell Coffee

The Rs 630-cr penalty imposed on DLF should prove to be a milestone for real estate sector

< The delay in completion of a building project beyond the period of commitment by promoter no doubt entails defeating/deferring the tax rebate on home loan to borrower. More importantly, such a delay also has the dreadful potential to the borrower being denied the exemption of tax on capital gains e.g. under section 54 of IT Act because of the stringent time limits laid down for purchase or construction of a new property.

Incidentally, this certainly cannot be taken to be the only one but is simply representative of many more of such instances, which bears on its sleeves the deficiency in professional competence in every sense of it. In that, had the connected professionals having an important role to play in ensuring ‘good governance’, primarily such as company secretary, statutory (financial /tax) auditor(s), advising/consultant lawyer(s), and the whole lot of the kind, cared to be guided by righteous conscience and acted with due diligence in performance of  respective duties altruistically enjoined / expected of them, particularly  even in the normal course, that would have immensely saved the customer community from such horrid reprehensible turn of events / bizarre situations. It is even now may not be late for all concerned, notably lending banks – both to the players in the realty sector so also to the home buyers- to realize that their contribution has never been positive; if at all, has always been glaringly negative.  It is high time  that they also should prudently, in their own self-interests as well as those of the rest of the society ,  “wake up, to smell coffee”. Provided, of course, there is still that popular drink left with its known original flavor cum taste.

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