“Section 2(29)”
The decision most relied on for Section 2(29) is CIT v. Sarkar Builders (375 ITR 392), cited in 79 judgments on BharatTax.
Leading authorities on Section 2(29)
An assessee should not be prejudiced by differences in accounting treatment if accounting principles are duly followed and the issue is revenue neutral, as hypothetical income cannot be subjected to tax.
Customer acquisition costs and advertisement expenditures are treated as revenue expenditures, not deferred expenditures, as there is no general concept of deferred expenditure for such items under Income Tax Law.
When relevant documents or additional evidence have a direct bearing on an issue, they may be allowed to be produced or admitted at the appellate stage, potentially leading to a de novo adjudication by the Assessing Officer for fresh consideration.
An appellate authority has the discretion to allow the production of additional evidence if it is required to pass orders or for any substantial cause, which must be exercised judicially.
The Income Tax Appellate Tribunal has broad discretion to admit or reject documents at the appellate stage. This discretion must be exercised judiciously, and if documents are relevant to the issue at hand, the Tribunal can admit them, consider them, or remit the matter to lower authorities.
Section 28(iv) cannot be applied to tax a sum in the hands of partners if no benefit or perquisite arises to them in the course of business. An increase in a partner's capital due to revaluation of firm assets lacks nexus with the business and is not taxable under Section 28(iv).
Any assessment or order passed in the name of a deceased person is void ab initio. The legal representatives of the deceased must be brought on record before any such proceedings are completed.
Tax authorities must assess business expenditure from the perspective of a prudent businessman, not their own viewpoint, when determining if it was wholly and exclusively for business purposes.
