Micro Financing by Trust – Not entitled for benefit of section 11
The Chennai Bench of the ITAT in Innovative Microfinance for Poverty Alleviation and Community Transformation v DCIT(E) [2025] 123 ITR (Trib) 188 (Chennai) has held that where an assessee trust formed with the objective of providing low interest loans to downtrodden individuals actually charged interest over and above the bank interest rate, resulting in huge profits, such activity was on commercial lines, profit motive not to be the predominant object thus disentitling it to the benefit of exemption u/s.11.
No Addition based on Seized Material of another person without Corroboration
The Delhi Bench of the ITAT in ACIT v New World Buildcon Pvt Ltd [2025] 123 ITR (Trib) (S.N) 25 (Del) has held that the statutory presumption u/s.292C is applicable only against the person from whom documents are seized in a search. If an addition is to be made on the basis of contents of seized materials from any other assessee, due corroboration is necessary.
Notices & Orders in the name of Deceased despite Knowledge of the Demise of Assessee – Quashed
The Bombay High Court in Amjad Ahmed Shaikh v ITO & Ors [2025] 474 ITR 579 (Bom) has held that notices and orders in the name of a deceased assessee despite knowledge of the demise of the assessee are bad in law. The High Court also held that corresponding with the CA of the assessee is irrelevant where such issue of the notice is not on a living person or the legal heir of the deceased. The Bombay HC thus quashed and set aside the notices and orders.
Notification No.38 / 2025 dated 23.04.2025
The CBDT has issued Notification in F.No.38 / 2025 dated 23.04.2025 notifying that expenditure incurred to settle proceedings initiated in relation to contravention or defaults under the following laws shall not be deemed to have been incurred for the purpose of business or profession:
- The Securities and Exchange Board of India Act, 1992
- The Securities Contracts (Regulation) Act, 1956
- The Depositories Act, 1996
- The Competition Act, 2002
No deduction or allowance shall be made in respect of such expenditure u/s.37(1) of the Income Tax Act.
