“Section 2(14)(c)”
The decision most relied on for Section 2(14)(c) is PCIT, Central-3 v. Allied Perfumers (P.) Ltd. (124 Taxmann.com 358), cited in 54 judgments on BharatTax.
Leading authorities on Section 2(14)(c)
The case is cited for various issues including the definition of capital assets, reassessment procedures under sections 153A and 153C, and the effect of clarificatory amendments.
The addition of cash deposits to an assessee's income under Section 68 is justified when the Assessment Officer notices huge cash deposits, as the onus is on the assessee to explain their nature and source.
A trust's exemption is cancelled if its property is used for the benefit of a person prohibited under section 13(3), or if the trust fails to accurately reflect its income, thereby not truly disclosing the income arising from trust property.
Where an expense is incurred for the purpose of acquiring a capital asset, and that asset is subsequently sold, the expenditure must be considered as part of the cost of acquisition of that asset for the purpose of calculating capital gains. This is because the expense forms an integral part of the cost of acquiring the asset, not an expenditure of revenue nature.
Expenses are to be apportioned among various units based on turnover, a method approved by the Supreme Court. The method of allocating exempt income by way of dividends to total gross revenue is also upheld.
A penalty order under section 271(1)(c) is unsustainable if the Assessing Officer (AO) initiates proceedings for "concealment of particulars of income" but ultimately finds the assessee guilty of "furnishing inaccurate particulars of income", or vice versa. The AO cannot be uncertain in the penalty order as to which charge applies, as this error goes to the root of the matter and is not saved by section 292B.
The potential for non-agricultural use or the purchaser's intention does not alter the agricultural character of land for capital gains purposes if it was agricultural at the time of sale and prior use. Market conditions leading to a high price do not change the essential nature of the land.
Expenditure incurred for issuing FCCB (Foreign Currency Convertible Bonds) is revenue expenditure as it is an expense for raising a loan, irrespective of future conversion into equity. A loan given by an assessee to its subsidiary is a capital asset under Section 2(14) of the Income Tax Act.
