SVKM’s Narsee Monjee Institute of Management Studies

Name of School - Kirit P. Mehta School of Law

Program: B.A., LL.B. (Hons.) 81001 & B.B.A., LL.B. (Hons.) Semester: VII
81002
Module: Principles of Taxation I Module Code: 81001P004 &
81002P005
Teaching Scheme Evaluation Scheme
Lecture Practical Tutorial Internal Continuous Term End
(Hours (Hours (Hours Credit Assessment (ICA) Examinations (TEE)
per per per week) (Marks - 40) (Marks- 60
week) week) in Question Paper)
4 0 0 4 Marks Scaled to 40 Marks Scaled to 60
Pre-requisite: Basic knowledge of accounts, Company Law and Constitution.
Objectives:
To understand
 How the taxation system of India has evolved
 What are the taxes under the State List and Centre List
 Understanding basic concepts of direct tax in India
 How is an individual taxed in India- under various heads of income
Outcomes:
After completion of the course, students would be able to:
 Identify the basics of corporate taxation in India
 Importance and applicability of Capital Gains tax
 Understand tax deduction at source
 Calculation of 182 days to decide residential status of individuals
 Understand the hierarchy, role and function of taxation authorities in
India
 Understand search and seizure procedures
 Understand that tax is a continuously evolving subject with changes
being brought about in the Budget every year.
 File their own returns
Detailed Syllabus: ( per session plan )
Unit Description Duration
1. Introduction to Taxation in India 5 Hrs
 History of Tax Law in India
 Government Financial Policy and Tax Structure
 Taxation as a fluid concept. Changes are brought every year in
Budget
 SVKM’s Narsee Monjee Institute of Management Studies

Name of School - Kirit P. Mehta School of Law

 Nature and Characteristics of Tax

- Distinction between Direct Tax and Indirect Tax
- Tax and Fee
- Tax and cess
- Tax planning, Tax Evasion & Tax avoidance
 Legislative power to levy taxes:
- Constitutional Provisions
- Distribution of Legislative Powers between the Union and
States with particular reference to Taxing Powers
- General Scheme of Distribution of Legislative Powers
(Articles 245 – 254)
- Distribution of Taxing Powers
- Entry 97 and Entry 86 of List I (Union List)
- Entry 49, List II (State List)
Cases:
1. Federation of Hotel and restaurant Association V. UOI[1989] 178
ITR 97
2. Bacha F. Guzdar vs C.I.T. Bombay AIR (1955) SC 74
3. In Re: Pfizer Corporation Vs Respondent 2004(271) ITR 101
(AAR)
4. CIT Vs R. D. Aggarwal & Co. (1965) 56 ITR 20 (SC)
5. Clifford chance Vs DCIT (2009) 176 TAXMAN 458 (Bom HC)
6. CIT Vs Soundarya Nursery (2000) 241 ITR 530 (MAD)
7. Linklaters LLP Vs ITO, International Taxation 2010 ITAT
Mumbai
8. Pradip J. Mehta Vs CIT (2008) 300 ITR 231 (SC)
9. GVK Industries Vs ITO 2011 3 SCALE 111
10. UOI v H.S. Dhillon AIR 1972 SC 1061
2. Basic concepts of Income-tax-I 7 Hrs
 Income [Definition : S. 2(24) ]
 Capital Receipt v. Revenue Receipt -Tests to distinguish
 Agricultural Income – Meaning of Agricultural Income[S. 2(1A),
10(1)]
 Assessee- Assessment year- Previous Year (S. 3)
 Residential status of Assessee (S. 6)
 Incidence of tax varies with residential status of an assessee
Cases:
1. CIT Vs Shaw Wallace & Co. 6ITC 178(PC)
2. Gopal Saran Narain Singh V. CIT [1953]3 ITR 237(PC)
 SVKM’s Narsee Monjee Institute of Management Studies

Name of School - Kirit P. Mehta School of Law

3. Cadell Wvg.Mill V. CIT [2001] 116 Taxman 77 Bom

4. State Bank of India V. CIT [2014] 148 ITD 71(Mum)
5. CIT v. Varadarajan 224 ITR 9
6. VVRNM Subbaya Chettiar v. CIT AIR 1951 SC 101
7. Vodafone International Holdings B.V. v.UOI (2012) 1 Comp LJ
225 (SC) CLASS PRESENTATION
8. DIT V. Copal research Ltd. [2014] taxman 125
3. Basic concepts of Income-tax-II 7 Hrs
 Total income of assessee (Ss. 4 and 5)
 Income deemed to accrue or arise in India (S. 9)
 Person
 Income not included in total income
 Deemed income
 Clubbing of income
Cases:
1. CIT v. Deepak Family Trust
2. Union of India v. R.C. Jain
3. Raghuvanshi Mills Ltd. V. CIT
4. CIT Vs Ghanshyam (HUF)
5. Bharat Earth Movers Vs CIT (2000) 245 ITR 428 (SC)
1. Grace Collis and others Vs CIT (2001) 248 ITR 323 (SC)
2. CIT Vs Madras Auto Services Ltd. (1998) 233 ITR 468 SC
3. CIT Vs National Storage (P) Ltd. (1967) 66 ITR 596 (SC)
4. Laxmipat v. CIT 12 ITR 489
4. Basic concepts of Income-tax- V 5 Hrs
 Tax Planning
 Chargeable income: Basis of charge (Receipt, Accrual, and Arisal)
 Rate of income tax
Cases
1. CIT v. Ashokbhai Chimanbhai
2. CIT v. Neyveli Lignite
3. Kusumben Mahadevia v. CIT
4. CIT v. Ashok Jain
5. CIT v BC Srinivasa Setty AIR 1981 SC 972
6. CIT v Rajendra Prasad Moody (1978) 115 ITR 519 SC
5. Heads of income-Salaries 5 Hrs
 What constitutes Salary
 House Rent Allowance
 SVKM’s Narsee Monjee Institute of Management Studies

Name of School - Kirit P. Mehta School of Law

 Pension
 Perquisites
 Tax Rates
 Standard Deductions/Deductions
 Slabs
 How to file IT Return: Form Saral
Cases
1. Gestetner Duplicators v. CIT
2. Reade v. Bearley
3. Vrajeshwari B. Parikh v. ITO
4. CIT v. Abdul Wahid & co.
Bajrang Prasad Ramdharani v. CIT

6. Heads of income- Income from House Property 5 Hrs

 Meaning of House Property
 Meaning of Owner and Co-owner/Deemed Owner
 Annual Value
 Deductions from Income from House Property
 Principle of Mutuality
 Computation of Property Income
Cases:
1. Ghansham Das v. Debi Prasad
2. ITO v. Dr. K.K Bhatnagar
3. S. Kartar Singh v. CIT
4. Estate of Ambalal Sarabhai v. CIT
5. Chelmsford Club v. CIT
6. CIT v. H.L. Gulati
7. Heads of income- Profits and gains of business or profession. 5 Hrs
 Chargeability- Meaning of Business
 Corporate Taxation
 Deductions
 AMT/MAT
Cases:
1. Mazgaon Dock Ltd. V. CIT
2. CIT v. S.K Sahana & Sons Ltd.
3. CIT v. Minal Rameshchandra
4. CIT v. City Mills Distributors
5. R.B Jodha Mal Kuthiala v. CIT
6. Maharashtra Hybrid Seeds v. CIT
 SVKM’s Narsee Monjee Institute of Management Studies

Name of School - Kirit P. Mehta School of Law

8. Heads of income- Capital gains 5 Hrs

- Meaning of Capital Asset
- Computation of Capital gain
- Cost of acquisition
- Indexed Cost
- Capital Gains exempt from Tax
- Extension of time-limit for acquiring new asset
- Short Term/Long term Capital Gains
Cases:
1. Usha Vaid v. ITO
2. CIT v. Cello Plast
3. Kapil Kr. Agarwal v. CIT
4. Sri. Kannan Rice Mills v. CIT
5. CIT v. Santosh Structural & Alloys Ltd.
6. Arun Sunny v. CIT
7. Lohia Metals v. CIT
9. Heads of income- Income from other sources 5 Hrs
- Basis of charge
- Dividend
- Winnings from lotteries etc.
- Income from machinery plant or furniture let on hire
- Interest on NSCs etc
- Deductions
Cases:
1. Morvi Mercantile Bank Ltd. V. CIT
2. Kantilal Manilal v. CIT
3. CIT v. Mayur Madhukant Mehta
4. CIT v. S. Joginder Singh
5. Sultan Bros v. CIT
10. Taxation of Charitable Trusts/HUFs/Section 8 Companies 2 Hrs
- Assessment of HUF
- Assessment of Partnership Firms
- Assessment of LLPs
- Assessment of Charitable Trusts
Cases:
1. Mohanlal Shah HUF v. ITO
2. Munjal Sales Corp. v. CIT
3. Income Tax v. Sheth Mafatlal Gagalbhai Foundation Trust
 SVKM’s Narsee Monjee Institute of Management Studies

Name of School - Kirit P. Mehta School of Law

11. Business Restructuring 2 Hrs

- Amalgamation
- Demerger
- Slump Sale
- Conversion of Firm/Pvt/ Ltd. Co. into an LLP
Cases:
1. CITv. Manjula Shah
2. Zuari Inds Ltd. V. CIT
3. CIT v. Spunpipe & Construction co.
12. Income-tax Authorities and their powers 2 Hrs
 Power and functions
 Search and Seizure (Ss.132, 132A, 132B)
 Best Judgment Assessment; Income escaping assessment
 (Ss. 139, 142, 143, 144, 145(2), 147, 148, 149, 150, 151 and 153)
 Offences and penal sanctions:
 Settlement of grievances:
 Authorities, powers and functions
- Income Tax Authorities
- Appointment of Income Tax Authorities
- Power of Tax Authorities
- Appellate Tribunal
- Settlement of cases
Cases
1. D.I.T. vs.Diamondstar Exports Ltd.; (2007) 293 I.T.R. 438 SC
2. Manish Maheshwari vs.A.C.I.T.; (2007) 289 I.T.R. 341 SC
3. Rajesh Kumar. vs. Dy.CIT.; (2006) 157 Taxman 168 (SC)
4. GKN Driveshafts (India) ltd vs ITO (2003) 259 ITR 19 SC
5. ITO vs Seth Bros (1969) 74 ITR 836 SC
6. Sahara India Vs CIT (2007) 289 ITR 473 SC
13. Miscellaneous- 1 Hr
 Set Off and Carry Forward of Losses
 Deductions and Collection of Tax at Source
 Advance Payment of tax
14. Advance Rulings for Non-Residents 1 Hr
- Procedure for filing application
- Applicability of Advance Ruling
- Ruling to be void in certain cases
- Authority for Advance Rulings
 SVKM’s Narsee Monjee Institute of Management Studies

Name of School - Kirit P. Mehta School of Law

Reading Material:
1.V. K Singhania Chapter 30
Cases:
1. Lloyd Helicopters v. CIT
Sin Oceanic Shipping v. AAR
15. GAAR & Transfer Pricing 3 Hrs
- Applicability of GAAR
- Procedure for invoking GAAR
- Taxation of international transaction
- Arms length price computation
- Advance Pricing Agreements
- Basic Concept of Transfer Pricing
- Important Rulings
Cases:
1. Diego India v. CIT
2. Development Consultants v. CIT
3. Vodafone India Services v. UOI
4. UCB India v. CIT
Total 60 Hrs
Text Books:
1. T.N Manoharan, Direct tax Laws and International Taxation.
2. Dr. Vinod K. Singhania, Direct Taxes Law and Practice.
Reference Books:
1. Kanga and Palkhiwala.
2. Sampat Iyengar.
Any other information :
Details of Internal Continuous Assessment (ICA)
Test Marks :
Term Work Marks :
Details of Term work :

___________ ____________
Signature Signature
(Prepared by Ms. Sohini Shrivastav) (Approved by Dean)