Section 114 of the Income Tax Act
The decision most relied on for Section 114 is CIT v. Associated Industrial Development Co. (P.) Ltd. (82 ITR 586), cited in 98 of the 48 judgments on BharatTax that turn on this section.
Leading authorities on Section 114
The assessee has the burden to prove whether shares are held as investments or as stock-in-trade. This requires the assessee to produce evidence from their records clearly distinguishing between shares held for investment and those held as stock-in-trade.
Funds received by an entity acting as a nodal agency or agent of the government for implementing specific government schemes, or income generated from such funds (like lease premiums or interest), are not taxable in the hands of the agency if held on behalf of or remitted to the government.
Institutions established for specific purposes are not considered 'local authorities' for the purpose of Section 10(20) of the Income Tax Act.
Revenue authorities are not justified in assessing business income in the hands of an entity engaged in construction and development of residential and commercial structures entirely on behalf of the State, as such income constitutes income of the State and is not exigible to income tax. This principle was affirmed by the jurisdictional High Court, affirming the Tribunal's decision.
Statements recorded during search or survey under section 132, if not retracted, can form the sole basis for computing undisclosed income, but retracted statements cannot be the sole basis for such computation.
Cancellation of registration granted under section 12A of the Income Tax Act, 1961, requires examination of the assessee's activities in light of the objects of the trust and the definition of 'charitable purpose' under Section 2(15), especially concerning the proviso.
When documents or messages are seized under section 132(4A) of the Income Tax Act, a presumption arises against the assessee, who must then provide a plausible explanation to rebut it.
The Commissioner has the power to cancel registration under Section 12AA(3) for violations occurring prior to the amendment by the Finance Act of 2010. This power existed even before it was explicitly conferred by the amendment.
The exercise of power under Section 131(1A) of the Income Tax Act is contemplated in a situation that arises before the exercise of power under Section 132.
Receipts arising to an assessee in its capacity as a Special Planning Authority (SPA) are not chargeable to tax, especially when established under specific acts and in line with precedents like CIDCO.
