Income Tax weekly flashback for the period 20 to 26 April 2025.
Table of Contents
Delhi High Court
Delhi High Court Deletes Income Tax Addition of Rs. 42.16 Cr. Against NTPC Subsidiary
The Delhi High Court has deleted the income tax addition of Rs. 42.16 Crores against NTPC Vidyut Vyapar Nigam Ltd., the Subsidiary of National Thermal Power Corporation Limited (NTPC) on account of sale of fly ash and cenosphere.
The bench of Justice Vibhu Bakhru and Justice Tejas Karia has observed that there is no question of the Assessee having earned any income. The fly ash did not belong to the Assessee, but to its holding company – NTPC. The Assessee had only sold the fly ash and utilized part of the funds as mandated and made over the balance funds to NTPC.
Income Tax Payable Remuneration Paid To Chairperson Of Educational Trust: Delhi High Court
The Delhi High Court has income tax payable remuneration paid to chairperson of educational trust.
The bench of Justice Vibhu Bakhru and Justice Tejas Karia has observed that exemptions under Section 11/12 of the Income Tax Act would not operate so as to exclude from the total income of the previous year any income, which is directly or indirectly, for the benefit of the person referred to in sub-section (3) of Section 13 of the Act. It is, thus, clear that if any part of the income of a trust for charitable or religious purposes is diverted for the direct or indirect benefit of a person referred to in sub-section (3) of that Act, that part of the income would not be excluded from the total income of the Assessee by virtue of Section 11/12 of the Income Tax Act. In other words, the exemption under those Sections would not be available to the extent that the said income of a charitable or religious purposes is applied for the benefit of a person specified in sub-section (3) of Section 13.
Bombay High Court
Amalgamated Company Can Claim Depreciation On Adjusted Written Down Value Of Assets Without Central Govt. Approval: Bombay High Court
The Bombay High Court has held that amalgamated company can claim depreciation on adjusted written down value of assets without central govt. approval under section 72A of the Income Tax Act.
Bombay High Court Upholds Disallowance of Interest Paid to Beneficiaries, Rules Trust as Association Of Persons
The Bombay High Court has upheld disallowance of interest paid to beneficiaries, and ruled that the appellant trust was an association of persons under Section 40(b) of the Income Tax Act, 1961.
Income Tax Dept’s Practice Of Adjusting Tax Refunds Beyond 20% Demand Is Illegal: Bombay High Court
The Bombay High Court has struck down the practice of adjusting tax refunds beyond the 20% demand payment as illegal and against CBDT Circulars.
The bench of Justice M.S. Sonak and Justice Jitendra Jain has observed that the adjustment of refund arising out of proceedings for assessment year 2014-15 against the demand for assessment year 2016-17 is unjustified and illegal.
ITAT
Mere Loose Papers Not Admissible Evidence For Making Income Tax Addition: ITAT
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has held that loose papers cannot be considered as admissible evidence for making an addition unless backed by independent corroborative material.
No Income Tax On Exchange Of Old Flats In Lieu Of Old Ones: ITAT
In a major relief to flat owners, the Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has held that no income tax is payable on exchange of old flats in lieu of old ones.
The bench of Sandeep Gosain (Judicial Member) and B.R. Baskaran (Accountant Member) has observed that it is a case of extinguishment of old flat and in lieu thereof, the assessee has got new flat as per the agreement entered with the developer for redevelopment of the society. Thus it is not a case of receipt of immovable property for inadequate consideration that would fall within the purview of the provisions of section 56(2)(x) of the Income Tax Act.
