“Section 64(3)”
The decision most relied on for Section 64(3) is CIT v. J.H. Gotla (156 ITR 323), cited in 176 judgments on BharatTax.
Leading authorities on Section 64(3)
The Supreme Court holds that for income tax purposes, the term 'income' includes 'loss,' allowing for the set-off of a spouse's or minor child's business losses when their income is clubbed with the assessee. This decision emphasizes interpreting tax statutes, especially benevolent provisions, by considering the legislative scheme over a strict literal construction.
Leave to appeal was granted by the Supreme Court in this case. The case concerns reassessment proceedings following a search.
An addition to income cannot be made solely on the basis of a statement recorded during a search under section 132(4) without independent corroborating evidence. Similarly, a penalty cannot be levied merely on the basis of assessment order findings, allowing the assessee to challenge the underlying facts in penalty proceedings.
An assessee's admission serves as an important piece of evidence but is not conclusive. The assessee can demonstrate that such an admission was incorrect or was made under a mistaken understanding.
The Assessing Officer accepted the assessee's claim of being in the construction business and its use of the project completion method, and the Revenue did not take remedial measures under sections 263 or 147, indicating acceptance of the assessment.
A statement recorded during a search cannot be the sole basis for an addition to income, especially if made in violation of CBDT instructions and the provisions of section 132(4).
The applicability of Section 115JB provisions is a matter for the Assessing Officer to consider, and judicial precedent, including the UCO Bank case, can be relied upon by the Commissioner (Appeals). However, this precedent may not hold good for assessment years post-amendment, particularly after Explanation 3 to Section 115JB was introduced.
A question of an Assessing Authority's jurisdiction cannot be disputed after assessment proceedings are completed. Such disputes can only be decided by the Commissioner or the Board, not by an appellate authority under Section 246.
