Section 10(35) — the law in short
What the courts have decided on section 10(35), in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.
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Mukundbhai Manubhai Patel v ACIT
High CourtHelps taxpayerValidity unconfirmed
I bought mutual fund units, took the dividend the same day and booked a short-term loss. The department calls it fictitious and has reopened. Can it?
Not on that material alone. The Gujarat High Court quashed a s.148A(d) order and s.148 notice where the reopening rested on an allegation that the fund house had manipulated its distributable surplus: purchasing units and earning dividend on the same day is not impermissible, and allegations against the fund manager cannot be extended to the investor without something showing he knowingly participated.
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Sobha Developers Ltd v DCIT
High CourtHelps taxpayerValidity unconfirmed
Can the Rule 8D figure be added back to book profit under clause (f) of the Explanation to s.115JB?
The Karnataka High Court held it cannot. A disallowance under s.14A is a notional disallowance, and the amount cannot be added back to book profit under clause (f) by taking recourse to s.14A. Clause (f) can operate only on amounts actually debited to the profit and loss account.
Listed strongest first: Supreme Court, then High Court, then Tribunal, then CBDT. Nothing here has yet been read in full by a chartered accountant — open an entry to see where it came from.