LKS Direct Tax Amicus, October 2024

Article

Applicability of Doctrine of Merger between intimation under Section 143(1) and assessment order under Section 143(3)

The article in this issue of Direct Tax Amicus discusses the issue of whether an intimation under Section 143(1) of the Income Tax Act, 1961 will automatically merge with an assessment order under Section 143(3). Considering various decisions of the ITAT, the authors (Abhinov Vaidyanathan and Bhavana Kulluru) note that it can be inferred that a strait jacket formula cannot be adopted for applying the Doctrine of Merger for an initiation under Section 143(1) and the assessment order under Section 143(3). According to them, while the taxpayers should continue to agitate all issues while filing appeal against regular assessment including issues arising in an intimation, they must also consider challenging the intimation independently in appeal wherever the issues dealt with in the intimation and the assessment order are different in order to avoid any challenge on non-applicability of Doctrine of Merger.

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Notifications and Circulars

·???????? Monetary limits enhanced for Departmental appeals before ITAT, High Courts and SLPs/appeals before Supreme Court???????????

·???????? Authorisation of officers and condonation of delay in filing returns claiming refund, carry forward of loss and set off thereof – Guidelines issued

·???????? Direct Tax Vivad se Vishwas Scheme, 2024 comes into force

·???????? Direct Tax Vivad se Vishwas Rules, 2024 notified

·???????? Direct Tax Vivad se Vishwas Scheme – Procedure w.r.t online filing of Form 1

Ratio decidendi

·???????? TOLA survives post IT Act amendment courtesy ‘substitution’ principle – Supreme Court upholds re-assessment notices – Supreme Court

·???????? Maharashtra Airport Development Co. Ltd is a State under Article 289(1) of the Constitution – Interest on fixed deposits is not chargeable to tax – ITAT Mumbai

·???????? Expenses not claimed in the ROI – Remedy lies with the administrative officers including CBDT and not before Appellate Authority – ITAT New Delhi

·???????? Company undergoing voluntary liquidation cannot claim exemptions from the applicability of any provisions of IT Act including Section 115JB – ITAT Kolkata

·???????? Section 115JB not applicable to banks constituted as ‘corresponding new bank’ in terms of the Banking Companies (Acquistion and Transfer of Undertakings) Act, 1970 – ITAT Mumbai

·???????? Profits attributable to a Permanent Establishment (‘PE’) in India would be liable to tax, irrespective of losses incurred at the entity level – Delhi High Court

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