DIRECT TAX :

1. No revision by CIT if AO had duly verified that sum deposited in bank account of director was income of Co.
IT : Where Assessing Officer had duly inquired about sum deposited in bank account of assessee and took a conscious decision that said sum represented income of company in which assessee was director, in absence of any cogent material which proved that decision taken by Assessing Officer was erroneous, revision order passed to tax same in assessee's hand was to be set aside.

IT : Order passed under section 153C could be revised under section 263; starting date of limitation would be computed from end of financial year in which section 153C order was passed and not from when return was processed under section 143(1).

2. Income derived from sale of shares by assessee carrying on his profession of doctor was taxable as capital gains.
IT: As amendment made in section 40A(3) by Finance Act, 2008 was prospective in operation; Assessing Officer was not justified in levying taxes on basis of said amended provision in assessment year 2005-06.

IT: Where assessee ayurvedic doctor was in business of purchase and sale of ayurvedic preparations, income derived by him on sale of shares was to be assessed under head capital gains.

3. Exp. incurred by Discovery, a program producer, to advertise channels was allowable as it was one of its functions.

4. No addition of unexplained investment in residential units on basis of report of District Valuation Officer.
IT: Where District Valuation Officer indicated higher investment in residential unit than investment shown by assessee, addition as undisclosed investment only on that basis was not justified.

5. HC set aside transfer order under sec. 127 as it contained reasons not specified in show cause notice.

6. No denial of sec. 10A relief by AO in ninth year relief alleging that there was reconstruction of old business.
IT : Where assessee's claim for deduction under section 10A was allowed in respect of three units in initial years, claim so raised could not be rejected in nineth year on ground that said units were mere restructuring/reconstruction units which came into existence on account of transfer of old business.

7. No reassessment on same ground for which reassessment was made in prior year which was quashed.

8. A Co. having Financial Year different than that of assessee couldn’t be selected as comparables for TP purposes.
IT/ILT: Companies engaged in development of software products are not comparable with company providing software development services.

IT/ILT: A company having different financial year ending than assessee cannot be selected as comparable in case of assessee.

IT/ILT: Where acquisitions made by a company during relevant financial year could have impacted revenue earning and profitability of company, it will not be safe to treat said company as a comparable.

IT/ILT: Every expenditure debited to profit and loss account cannot be considered as operational in nature so as to include same in operating cost.

IT/ILT: Though benefit of risk adjustment can be given in an appropriate case, but it has to be on basis of facts and evidence produced by assessee.

IT/ILT: Suitable adjustment may be given from operating cost if any part of employees cost is found non-operational.

9. Appellate authorities to make enquiry on failure of AO to do so before deleting additions made by AO.

10. Internal accruals of trust which result in reduced disbursement of tax free govt. grants aren't taxable.

Source : taxmann