Tax INFORM- January 2024

The thirty-seventh issue of our monthly tax newsletter – Tax Inform, is out. Through these newsletters, we provide a compilation of key tax-related case laws, circulars, notifications, etc. issued by the authorities in the previous month, impacting entities and individuals operating in India.

The highlights of the current issue are:

Direct Tax – 

Domestic Tax Rulings:

• Mumbai ITAT reiterates that a mere defect in the notice also would vitiate penalty proceedings.
• Delhi ITAT lays stress on liberal interpretation of Section 54, allows deduction for sale proceeds invested in new house in the name of assessee’s spouse.
• PCIT erred by exercising powers under Section 263 as assessing officer had indeed conducted an enquiry about shares issued at high premium: Delhi HC.
• In dispute involving determination of fair market value of property, Madras HC directs revenue to dispose of statutory appeal within 3 months.
• Madras HC opines that penalty proceedings under Section 271E were based on wrong assumption, directs Appellate Authority to not insist on any pre-deposit.

Notifications/ Circulars:

• Central Government notifies investment in financial products by non-residents with ‘IFSC capital market intermediary’ for Section 10(4G) exemption.
• CBDT issues guidelines on tax deduction by e-commerce operators under Section 194-O(4).

Indirect Tax – 

Goods & Services Tax

Case Laws:

• Rajasthan HC directs payment of interest for delayed GST refund to the assessee as per Section 56 of the CGST Act.
• GST is payable at the time of issuance of gift vouchers if used for identified goods specified in vouchers, whereas in unspecified goods at the time of redemption: Madras HC.
• No penalty or late fee should be levied for making payment of Kerala Flood Cess under the wrong head in GSTR-3B: Kerala HC.

Notifications/ Circulars:

• Formation of the principal bench of the GST Appellate Tribunal in New Delhi.
• Government notifies extension of time frame for tax recovery.