“Section 53(3)”
The decision most relied on for Section 53(3) is CIT v. Kanpur Coal Syndicate (53 ITR 225), cited in 359 judgments on BharatTax.
Leading authorities on Section 53(3)
The Commissioner (Appeals) holds plenary powers when disposing of an appeal, with their scope being coterminous with the Assessing Officer. This allows the CIT(A) to exercise all powers of the AO, including admitting additional evidence and redetermining income.
A provision for gratuity liability, calculated on an actuarial basis and spread over a number of years, is an allowable business expense. Such a provision is considered a charge against profits rather than a reserve.
Technical services involve human intervention and expertise, not just routine or machine-based operations. Routine customer support and standard facility provision through technology do not constitute technical services under the Act.
The expression "for the purpose of business" is wider in scope than "for the purpose of earning profits" and encompasses expenditures made for commercial expediency, business preservation, administration, and modernization.
The term 'record' under Section 263(1) of the Income Tax Act includes all material available to the Commissioner at the time of his examination, not merely the records that were available to the Assessing Officer when the original assessment order was passed.
The Bombay High Court holds that employees' contributions to provident fund and ESIC, though paid beyond the due dates specified in the respective welfare legislations, are allowable as a deduction under section 36(1)(va) if they are paid before the due date for furnishing the return of income under section 139(1) of the Income-tax Act.
For reassessment under Section 147, merely finding deposits in a savings bank account is not sufficient 'reason to believe' for the Assessing Officer. The officer must specifically record reasons demonstrating that income has escaped assessment to validly issue a notice under Section 148.
Failure to fully and truly disclose material facts, for the purpose of reassessment beyond four years, extends beyond the income tax return to omissions during assessment proceedings. Mere disclosure of a transaction does not constitute true and full disclosure if underlying material facts are withheld.
