“section 56(2)(vii)”
The decision most relied on for section 56(2)(vii) is Rajeev Kumar Agarwal v. ACIT (149 ITD 363), cited in 104 judgments on BharatTax.
Leading authorities on section 56(2)(vii)
Curative amendments, such as a proviso to Section 40(a)(ia) introduced to remove undue hardship, apply retrospectively even without specific legislative declaration, rectifying shortcomings and obviating unintended difficulties.
The revenue must prove that an assessee received extra consideration beyond the declared value; a Departmental Valuation Officer's (DVO) report alone is insufficient to establish such receipt.
Section 2(22)(e) of the Income Tax Act, 1961, aims to prevent tax evasion by treating certain payments made by closely held companies to shareholders or their concerns as dividends.
The Supreme Court remands a matter when an assessee is deprived of the opportunity to cross-examine individuals whose statements were relied upon by the Revenue under Section 132(4) of the Income Tax Act.
The case addresses the taxability of cash withdrawn from sub-contractors' bank accounts by employees of a civil contractor engaged in infrastructure development. The revenue observed these withdrawals during search proceedings, indicating potential issues with the assessee's tax compliance.
The Assessing Officer (AO) is not required to refer the valuation to the District Valuation Officer (DVO) if the AO has conducted a detailed inquiry and is satisfied with the cost of construction. Strict adherence to procedural requirements is essential; failure to comply with mandatory conditions renders the assessment based on such non-compliance invalid.
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.
A debt written off in the assessee's books as irrecoverable, which was advanced in the ordinary course of business, is allowable as a deduction. The court noted that the Tribunal may have made a mistake in reproducing the Commissioner's findings, but this did not raise a substantial question of law regarding the allowability of bad debts.
