Only profit on the sale of the licence should be chargeable to tax under s 28(iiia) and not the profit which may come in the future on the sale of the licence, as held by KolHC in GKW Limited v CIT — In favour of: The assessee; ITA No 1 of 2004.
Decided on: 13 July 2011.
Book profits — Profit on the sale of fixed assets forms a part of the book profits under s 115JA of the Income Tax Act, 1961.
Interest under s 234B — Provisions relating to payment of advance tax are applicable in a case where the total income is deemed to be 30% of the book profits under s 115JA and the Tribunal was justified in upholding the charging of interest under s 234B in the appellant’s case for AY 1997–1998.
Business expenditure — Expenditure incurred on the rent and repairs and maintenance of the guest house is allowable under s 30.
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