CA Nirmal Ghorawat's Blog

Memorandum of Partition – Requirement of Registration

In the matter of Popatlal Devaram vs CIT (1970) 77 ITR 1013, the Hon’ble Orissa High Court has HELD : The sole question on which this court, is to express its opinion is whether the memorandum dated May 1, 1957, is compulsorily registrable. Law is well settled that a partition of the joint family properties…
Partnership between Karta of HUF and Coparceners or Members

It is a well settled proposition applicable to Hindu law that members of the joint family and even co-partners can, without disturbing the status of the joint family or the coparcenary, acquire separate property or run independent business for themselves. Ratanchand Darbarilal vs Commissioner Of Income TaxAIR 1985 SC 1572, (1985) 48 CTR SC 349,…
Hindu Undivided Family – Coparcener versus Member

A coparcener is a person who acquires a right in the ancestral property by birth and a person who has a right to demand partition in the HUF property. Any person who is a part of the family other than a coparcener is simply called a member. The coparcener is also a member of the…
Claim of Exemption from Capital Gains by Legal Representative filing ITR

Facts of the case : Assessee transferred a capital asset resulting in a Capital Gain but died before filing his Income Tax return / making deposit or investment for purpose of exemption u/s 54. Now, legal heirs / executors (if will is made) will file ITR as Legal Representative u/s 159. Query raised is :…
(Fiat) Money as Securitization – an impending crisis?

Google Dictionary defines securitisation as the process of “conversion of asset into marketable securities.” Investopedia defines Securitisation “as the procedure where an issuer designs a marketable financial instrument by merging or pooling various financial assets into one group.” Money or Currency or Bank Notes is in my opinion, one of the earliest examples of securitisation, even before…
Capital Allocation Psychology – Profit booking / No loss booking and Averaging

A largely prevalent Investor / Trader psychology is to make gains in every script in the portfolio (even if assessing returns on investment on the whole portfolio). So these investors / Traders are quick to book profits on positive movement in certain scrips and also endlessly wait on scrips with a negative movement, sometimes also…
INTERPLAY OF BENAMI LAW, AS AMENDED IN 2016, TRANSFER OF PROPERTY ACT, 1882 AND REGISTRATION ACT, 1908 IN CASE OF PART PERFORMANCE OF CONTRACT OF TRANSFER OF IMMOVEABLE PROPERTY (SECTION 53A)

According to para 2 of Section 54 of The Transfer of Property Act, 1882 – Transfer by way of Sale in a Immoveable property of value exceeding Rs 100 can only be made by way of a Registered Instrument. However, on account of Part Performance as enumerated in Section 53A of the Transfer of Property…
Moneylending related offence included under PASA in Gujarat

The Governor of Gujarat has promulgated ‘The Gujarat Prevention of Anti Social Activities (Amendment) Ordinance, 2020’ with effect from 07 September 2020. Clause (ga) inserted in Section 2 defines a “money lending offender” to mean a person, who Offences under Chapter IX of Gujarat Money Lenders Act, 2011 include : Section 3 of the Gujarat…
Banning of Unregulated Deposit Schemes

1. The Government of India has promulgated ‘The Banning of Unregulated Deposit Schemes Act, 2019’ (21 of 2019) and it has commenced from 21 February 2019. Further, the Department of Financial Services, Ministry of Finance, Government of India, has notified ‘The Banning of Unregulated Deposits Schemes Rules, 2020’ with effect from 12 February, 2020. 2.1…
India’s Equalisation Levy, US Trade Act and Tax Avoidance Arrangements : An interplay

The US Trade Representative has initiated an investigation into potential tariff and non-tariff barriers arising out of Equalisation Levy imposed by India that is purported to affect “US Exports”. Equalisation Levy (popularly dubbed “Google Tax”) is imposed by India on Advertising and eCommerce companies not having a Permanent Establishment in India and thus avoiding Income…