Taxability of consumer deposits: deposits treated as trading receipts or appropriated to reserves are taxable as revenue receipts. The Board directs that refundable consumer deposits treated in substance as trading receipts are taxable as revenue receipts in the year of receipt; appropriation of deposits by transfer to general reserve renders them taxable as revenue receipts in the year of transfer. A review of completed assessments from assessment year 1972-73 onwards is to be undertaken to identify such misclassifications and quantify the approximate tax effect, with results to be reported by the prescribed deadline.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Taxability of consumer deposits: deposits treated as trading receipts or appropriated to reserves are taxable as revenue receipts.
The Board directs that refundable consumer deposits treated in substance as trading receipts are taxable as revenue receipts in the year of receipt; appropriation of deposits by transfer to general reserve renders them taxable as revenue receipts in the year of transfer. A review of completed assessments from assessment year 1972-73 onwards is to be undertaken to identify such misclassifications and quantify the approximate tax effect, with results to be reported by the prescribed deadline.
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