Unmindful litigation by Government Departments:
The propensity of Government Departments and public authorities to keep litigating through different tiers of judicial scrutiny is one of the reasons for docket explosion. The Income Tax Department of the Government of India is one of the major litigants. There are two departmental scrutinies at the level of the Assessing Officer and the Commissioner of Income Tax (Appeals) and thereafter an independent judicial scrutiny at the Income Tax Appellate Tribunal (hereinafter referred to as the ‘ITAT’) level followed by the legal issue which can be inquired into by the High Courts. The last tier is, of course, the jurisdiction under Article 136 of the Constitution of India before the Supreme Court.
Mindful of the phenomenon of the docket explosion and the rising litigation in the country, the Union of India in order to ensure the conduct of responsible litigation framed what is today known as the National Litigation Policy, to bring down the pendency of cases and get meaningful issues decided from the judicial forums rather than multiple tiers of scrutiny just for the sake of it. The Government, being a litigant in well over 50 per cent of the cases, has to take a lead in not being a compulsive litigant. Continue reading “National Litigation Policy to reduce litigation with Government”
Deduction for depreciation u/s. 80-IA of Income Tax Act, 1961
Whether claim for deduction on account of depreciation under Section 80-IA is the choice of the assessees or it has to be necessarily taken into consideration while computing the income under this provision?
Section 80-IA of the IT Act at relevant time was as under:
“80-IA. Deductions in respect of profits and gains from industrial undertakings etc., in certain cases.- (1) Where the gross total income of an assessee includes any profits and gains derived from any business of an industrial undertaking or a hotel or operation of a ship or developing, maintaining and operating any infrastructure facility or scientific and industrial research and development or providing telecommunication services whether basic or cellular including radio paging, domestic satellite service or network of trunking and electronic data interchange services or construction and development of housing projects or operating an industrial park or commercial production or refining of mineral oil in the North Eastern Region or in any part of India on or after the 1st day of April, 1997 (such business being hereinafter referred to as the eligible business), to which this section applies, there shall, in accordance with and subject to the provisions of this section, be allowed in computing the total income of the assessee, a deduction from such profits and gains of an amount equal to the percentage specified in sub-section (5) and for such number of assessment years as is specified in sub-section (6).”
Continue reading “Claim of depreciation u/s. 80-IA of Income Tax Act, 1961”
Extraction if amounts to manufacture or production?
Does extraction and processing of iron ore amount manufacture or production of any article or thing?
Production means amongst other things that which is produced; a thing that results from any action, process or effort, a product; a product of human activity or effort”. From the wide definition of the word “production”, it has to follow that mining activity for the purpose of production of mineral ores would come within the arnbit of the word “production” since ore is “a thing”, which is the result of human activity or effort.
In CIT v. N. C. Budharaja and Co. (1993) 204 ITR 412 (SC): AIR 1993 SC 2529: 1994 SCC Supl. (1) 280 it was held that the word ,production” is much wider than the word “manufacture”. It was said (page 423) :
“The word production has a wider connotation than the word manufacture. While every manufacture can be characterized as production, every production need not amount to manufacture …. Continue reading “What is the meaning of word “production” and “manufacture”?”
INCOME TAX PROVISIONS AT A GLANCE:
2. As per Income Tax Act, Income is taxable under five heads- Salary, House Property, Business or Profession, Capital Gain and Other Sources.
3. Salaried person must obtain Form 16 from his Employer Every Year.
4. Income Tax Return should be filed by considering Form 16 and other Income.
5. Transport Allowance is exempt up to Rs.1,600 per month.
6. 30% Standard deduction is available on Income from House Property.
7. Income to be considered as deemed let out on second House property. Continue reading “Income tax law in India: Implications for tax payers”