Section 60 — the law in short
What the courts have decided on section 60, in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.
-
Radhasoami Satsang v CIT
Supreme CourtHelps taxpayer
The department accepted your position for years and has now reversed it. Can it?
Not without a material change. Res judicata does not strictly apply between years, but where a fundamental aspect running through several years has been found as a fact and allowed to stand, it should not be changed in a later year.
-
Provat Kumar Mitter v CIT
Supreme CourtHelps department
I assigned the dividends on my shares to my wife for her life but kept the shares. Is that dividend still my income?
Yes. The Supreme Court held that the deed of 19 January 1953 was not a transfer of any existing property. The assessee kept the shares and so kept the right to participate in the company's profits; what he made was a contract to make over to his wife, during her life, every dividend that might in future be declared on those shares. The company could pay only the registered shareholder or on his orders, so the income continued to accrue to him and was afterwards paid over under the contract. That is an application of income after it accrues, not a diversion before it accrues.
-
IVRCL-KBL (JV) v ACIT
High CourtHelps taxpayer
My joint venture bid for and won the contract, the whole of it was back-to-backed to a constituent member, and the government deducted TDS from the JV's bills. The Assessing Officer refuses the JV credit under Rule 37BA(2)(i), saying credit belongs to the member who did the work. Who gets it?
The joint venture does. Rule 37BA(2)(i) displaces credit from the deductee to another person only where some provision of the Act makes the income assessable in that other person's hands, and only where the proviso's machinery has been followed - the deductee files a declaration with the deductor and the deductor reports the deduction in the other person's name. Neither condition was met, and the Court set aside the assessment orders to the extent they denied the JV credit.
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.