When 80P Meets Bank Interest: Nagpur ITAT Reaffirms the View on allowability of deduction of credit cooperative societies     A decade-old argument finds fresh acceptance in three cooperative society cases For cooperative credit societies, interest earned on bank deposits has been a recurring tax controversy. The Assessing Officer often sees an FDR and immediately…

When Tax Rules Surprise You – The Taxman Isn’t Always Asking for More! [Query 1] My income during the year from salary was ₹11,72,190/-, Interest & Other Income was of ₹55,247/-, Short Term Capital Gain (STCG) on shares taxable at 20% was of ₹4,14,626/-. As such, my income is exceeding ₹12 Lakh and so my income was taxable. I…

Section 69 Addition Cannot Be Based on Mere Suspicion or ‘Human Probabilities’ Once the Source of Cash Is Proved: ITAT Chennai   One of the most common reasons for additions under Section 69 of the Income-tax Act is cash deposited in a bank account. In many assessments, taxpayers produce documentary evidence explaining the source of the cash,…

Is a Section 143(2) Notice Invalid If It Does Not Mention ‘Limited Scrutiny’ or ‘Complete Scrutiny’? ITAT Special Bench Says No   One of the most frequently raised legal challenges in income-tax assessments concerns the validity of a notice issued under Section 143(2). In recent years, taxpayers have argued that notices issued after the CBDT Instruction dated…

Can the CIT(A) Enhance an Assessment by Introducing a Completely New Source of Income? ITAT Delhi Says No   The power of the Commissioner of Income Tax (Appeals) [CIT(A)] to enhance an assessment is one of the most potent appellate powers under the Income-tax Act. However, an equally important question arises: Can the CIT(A) travel beyond the assessment…