“Section 70(3)”
The decision most relied on for Section 70(3) is CIT v. Yokogawa India Ltd. (391 ITR 274), cited in 290 judgments on BharatTax.
Leading authorities on Section 70(3)
Deduction under Section 10A or 10AA of the Income-tax Act is computed on the profits of the eligible unit without first setting off losses from other units or non-eligible units. Conversely, losses incurred by an eligible unit are allowed to be set off against the assessee's other taxable business profits.
Interest received under Section 28 of the Land Acquisition Act, 1894, forms an integral part of enhanced compensation and is not taxable as "Income from Other Sources" under Section 56(2)(viii) of the Income-tax Act, 1961. The Finance Act, 2009 amendments do not alter the compensatory nature of such interest.
An assessment order is erroneous and prejudicial to the interest of the revenue if the Assessing Officer fails to conduct necessary inquiries or investigate facts when circumstances warrant it, demonstrating a lack of complete scrutiny. This failure to act as an investigator and not just an adjudicator can trigger revision under Section 263.
Expenditure incurred for the transfer of the use of licenses, without acquiring ownership rights or an enduring benefit, constitutes revenue expenditure. Such payments are allowable as a deduction if they are directly relatable to services in the revenue field.
Each transaction can be considered a separate source of income, allowing taxpayers to choose between the Income-tax Act and a Double Taxation Avoidance Agreement (DTAA) for each transaction. Section 70(2) of the Act does not prescribe an order for setting off specific short-term capital losses against specific short-term capital gains, favouring the taxpayer in interpretation.
A statement made during a search under section 132(4) cannot be retracted if there is no evidence to support the retraction. Loose papers found during a search do not automatically become 'dumb documents' if they are considered part of the seized material.
Capital gains arising from the transfer of equity shares and equity-oriented mutual funds are exempt if the shares are long-term capital assets, transferred on the stock exchange, and the sale transaction is subject to levy. The case also relates to the application of beneficial provisions and the rejection of claims under Double Taxation Avoidance Agreements (DTAA).
Giving corporate guarantee for loans to associated enterprises is not an international transaction and amendments to Section 92B are not retrospective.
