“Section 185(1)”
The decision most relied on for Section 185(1) is 319 ITR 306 (SC); CIT v. Vinay Cement Ltd. (84 Taxmann.com 185), cited in 300 judgments on BharatTax.
Leading authorities on Section 185(1)
Employee and employer contributions towards Provident Fund (PF) and Employees' State Insurance (ESI) are allowable deductions under sections 36(1)(va) and 43B, respectively, if deposited on or before the due date for filing the return of income under section 139(1), even if paid after the due date prescribed under the respective welfare legislation.
Employee contributions to provident fund or other welfare funds, if deposited by the employer before the due date for filing the return of income under section 139(1), are allowable as a deduction and cannot be disallowed under section 43B of the Income-tax Act.
The Assessing Officer is justified in initiating reassessment proceedings under Section 147 based on specific, tangible information received, even if an assessment under Section 143(1) or 143(3) was previously done. At the initial stage, "reason to believe" only requires relevant material to form a reasonable belief that income has escaped assessment, not established proof of escapement.
Where services may fall into the category of consultancy services, their taxability in the context of technical, managerial, and consultancy services can be examined, especially when such services may overlap.
When lending money is not the business of a company, loans or advances given to an assessee-shareholder are treated as deemed dividends under section 2(22)(e) of the Income-tax Act. The provisions of section 2(22)(e) apply to a company that has taken a loan from its subsidiary.
Where cash sales have already been offered as income, the resulting bank deposits cannot be taxed as unexplained income under Section 69A or 68 of the Act. Deposits arising from cash sales that have been accounted for in the books cannot be treated as unexplained.
MAT credit under section 115JAA of the Income-tax Act, 1961, includes surcharge and cess in the calculation of the entire component of taxes.
Expenditure incurred on the feasibility of a new business is not an admissible deduction. This is because it is considered capital expenditure and not an expense incurred in the ordinary course of the existing business.
