“Section 4(1)”
The decision most relied on for Section 4(1) is Mavilayi Service Co-operative Bank Ltd. v. CIT (431 ITR 1), cited in 999 judgments on BharatTax.
Leading authorities on Section 4(1)
Section 80P(4) serves as a proviso to Section 80P(1) and (2), excluding only cooperative banks that are cooperative societies and possess an RBI license for banking business. Its purpose is to exclude cooperative banks operating like commercial banks that lend money to the public.
A notice issued under Section 274 read with Section 271(1)(c) is invalid if it fails to specify whether penalty proceedings are for concealment of particulars of income or furnishing inaccurate particulars of income. Such lack of specificity vitiates the penalty proceedings.
Interest income earned by a cooperative society from its investments or surplus deposits with a cooperative bank is eligible for deduction under Section 80P(2)(d) of the Income-tax Act, 1961.
A citizen is free to carry on business within the law, and mere tax planning without a motive to evade taxes through colorable devices is not frowned upon. The liability to taxation, for the purpose of tax treaty application, is a legal situation, not the fiscal fact of actual payment.
Admissions, whether made through entries in account books or statements, are important pieces of evidence but are not conclusive. An assessee has the right to demonstrate that an admission made by them is incorrect or can be retracted.
Co-operative banks are not fundamentally different from co-operative societies, entitling them to claim deductions under Section 80P of the Income Tax Act, 1961, including for interest income treated as business income.
Assessment based solely on a statement recorded under Section 132(4) of the Income Tax Act requires the statement to be relatable to incriminating material or evidence found during the search, especially when considering Section 158BB(1) which restricts computation of undisclosed income to evidence found during search.
Statements recorded during a survey under Section 133A do not have evidentiary value as Section 133A does not empower examination on oath. Consequently, additions to income cannot be made solely based on such uncorroborated statements without other credible evidence.
