This half-yearly round-up analytically summarizes the key direct tax decisions of the Income Tax Appellate Tribunal (ITAT) reported at Taxscan.in during the first half of 2024.
The Income Tax Appellate Tribunal (ITAT), Ahmedabad bench, held that the Assessing Officer should not disallow business loss incurred in share transactions without verifying the documents.
The bench observed during the proceedings that documents such as contract notes, investorâs report, and client-wise sauda summary were before the Assessing Officer, but he did not take cognizance of these documents, stating that the assessee was directly involved in sham and bogus transactions of entry providers.
The Income Tax Appellate Tribunal (ITAT) Bangalore bench observed that the assessee was delayed in the payment of employeesâ contribution to ESI and Provident Fund. Consequently, the bench upheld the disallowance made by the lower authorities.
After reviewing the facts and records, the single-member bench of Chandra Poojari (Accountant member) held that any delay in the payment of employeesâ contribution to ESI & PF beyond the date prescribed in the respective Act will be disallowed. Consequently, the bench dismissed the appeal of the assessee.
The Income Tax Appellate Tribunal (ITAT), Ahmedabad bench, while dismissing the appeal filed by the assessee, observed that the assessee failed to provide details for the commissioning of assets on different dates to compute correct depreciation.
After reviewing the facts and records, the two-member bench of Waseem Ahmed (Accountant Member) and Suchitra Kamble (Judicial Member) observed that to adjudicate the issue, the assessee has to provide details regarding the commissioning of assets on different dates before the AO to compute the correct depreciation. Therefore, the assessee failed to produce the necessary documents.
The Income Tax Appellate Tribunal (ITAT), Mumbai bench, while upholding the reassessment proceedings, held that the sale and purchase of immovable property by the assessee were not disclosed in the original return.
The Income Tax Appellate Tribunal (ITAT), Pune bench, held that the assessee failed to respond to the notice issued to produce required documents contemplated under Rule 17A(2) of the Income Tax Rules. Thus, after analyzing the facts, the tribunal directs readjudication by providing an opportunity to the assessee.
The bench, during the proceedings, observed that the purpose of the provisions for the registration of trust under Section 12A/12AB and granting of recognition under section 80G of the Act derives their spirit from the Directive Principles of State Policy enshrined in the Constitution of India.
The Income Tax Appellate Tribunal (ITAT), Delhi bench held that no proceedings should be initiated when the National Company Law Tribunal (NCLT) granted a moratorium against corporate debtors under Section 14 of the Insolvency and Bankruptcy Code, 2016.
After reviewing the facts and records, the two-member bench of N.K. Billaiya (Accountant member) and Astha Chandra (Judicial Member) observed that NCLT has granted a moratorium against the institution of proceedings against the corporate debtor.
The Income Tax Appellate Tribunal (ITAT), Delhi bench held that the absence of bills and invoices for wristwatches found during the search proceedings should not be a reason for making additions under Section 69A of the Income Tax Act, 1961.
The bench noted the assesseeâs substantial means, demonstrated by the capital account statement. After reviewing the facts, the bench, consisting of Pradip Kumar Kedia (Accountant member) and N. Saktijit Dey (Vice-President), concluded that the assessee had ample means to invest in the wristwatches.
The Income Tax Appellate Tribunal (ITAT), Delhi bench directed readjudication of matter due to an inability to identify the relevant income disclosed in the Income Tax Return for the claim of Tax Deduction at Source.
After reviewing the facts and records, the single-member bench of Dr. B. R. R. Kumar (Accountant member) remanded the matter to the file of the A.O. for the limited purposes of verification and reconciliation with respect to the TDS claim.
The Income Tax Appellate Tribunal (ITAT), Mumbai, while directing readjudication, observed that the assessee has failed to establish the genuineness of the payment made for vacating the encroached land.
The tribunal observed that the assessee claimed to have paid Rs. 1,30,00,000/- to Shri Ganesh Vithal Indore for vacating the encroached land at Palghar. The AO summoned Shri Ganesh Vithal Indore; however, in spite of service of summon u/s 131 of the Act, Shri Ganesh Vithal Indore neither appeared nor filed any details/reply.
The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) nullified income tax additions in a penny stock deal for quick gains.
The two-member bench comprising Narendra Kumar Choudhry (Judicial Member) and S. Rifaur Rahman (Accountant Member) observed that though characteristics of penny stock existed, the department didnât provide materials linking the assessee to dubious transactions related to entry, price rigging, or exit providers.
The Chandigarh bench of the Income Tax Appellate Tribunal (ITAT) observed that minor delays in uploading assessment orders or generating Document Identification Number (DIN) will not render assessments unsustainable.
The two member bench of the tribunal comprising Aakash Deep Jain (Vice President) and Vikram Singh Yadav (Accountant Member) concluded that Section 153(3) did not impose a limitation period for issuing, uploading, or communicating orders. In a case where the assessment order was made on 31/03/2022 but uploaded, and DIN generated on 01/04/2022, with communication on 03/04/2022, the Court rejected claims of limitation
The Kolkata bench of the Income Tax Appellate Authority rejected revenueâs case for filing an appeal against the decision on CIT(A) for taxing the assessee under Section 68 of the Income Tax Act. The bench came to this conclusion as it was ascertained that there wasnât sufficient cause for imposing Section 68 of the Income Tax Act on the assessee.
The two member bench composed of Rajesh Kumar (Accountant Member) and Rajpal Yadav (Vice-President) after consideration of the order of CIT(Appeals) dismissed the appeal of the Revenue.
The Income Tax Appellate Tribunal (ITAT), Mumbai bench directed readjudication in respect of addition made on receipts of agricultural activity.
After reviewing the facts and records, the two-member bench Of Om Prakash Kant (Accountant member) and Sandeep Singh Karhail,(Judicial Member) directed readjudication in respect of addition made on receipts of agricultural activity. Rituja Pawar Deswal, counsel appeared for assessee and P.D. Chogule , counsel appeared for revenue.
In a major relief to the Indian Chamber of Commerce ( ICC ), the Kolkata Bench of the Income Tax Appellate Tribunal ( ITAT ) granted income tax exemption on receipts from seminars and conferences.
A Two-Member Bench comprising Rajpal Yadav, Vice-President ( KZ ) and Rajesh Kumar, Accountant Member observed that âWe are inclined to hold that the ICC is not carrying on any activity of holding meetings, seminars and conferences for business purpose but only in support its main object and it charges from its participants, members and non-members the amount of fee which does not even covers the cost of holding such events. In our opinion, the decision is squarely applicable to the facts of the case and in view of that the ICC is entitled to exemption under Section 11 of the Income Tax Act as the activities of the advancement of main object is not hit by the proviso to Section 2(15) of the Income Tax Act even post amendments.â
The Income Tax Appellate Tribunal (ITAT), Ahmedabad bench upheld the order of canceling deduction of Tax Deduction at Source at 20% on payment made by the Indian Company for damage of vessels
After reviewing the facts and records, the two-member bench Of Waseem Ahmed (Accountant member)
and Madhumita Roy,(Judicial Member) upheld the order of canceling deduction of Tax Deduction at Source at 20% on payment made by the Indian Company for damage of vessels
The Income Tax Appellate Tribunal (ITAT), Hyderabad bench, while deleting the addition made by the Assessing Officer, held that unbilled revenue could not be considered as income once it had been written off.
After reviewing the facts and records, the two-member bench of R.K. Panda (Vice-President) and Laliet Kumar (Judicial Member) held that unbilled revenue could not be considered as income once it had been written off. Hence, the bench allowed the appeal of the assessee.
The Ahmedabad bench of the Income Tax Appellate Tribunal (ITAT) observed that Cost of acquisition of capital assets under section 48(ii) of Income Tax Act 1961, should be the actual cost of acquisition of agricultural land.
The two member bench tribunal comprising Annapurna Gupta (Account Member) and Siddhartha Noutiyal (Judicial Member) observed that the CIT (A) aptly noted the unreliability of the registered valueâs report, as explained in their order. Considering the caseâs particulars, the CIT (A) appropriately affirmed the Assessing Officerâs decision to refer the matter to the valuation officer for determining the assetâs value. Consequently, discerned no substance in the supplementary argument presented by the assessee. The Assesseeâs additional ground was dismissed.
The Delhi bench of the Income Tax Appellate Tribunal (ITAT) nullified the assessment order under Section 143 of the Income Tax Act 1961, citing the non-mentioning of a valid Director Identification Number (DIN).
The two member bench of the tribunal comprising G.S Pannu (Vice President) and Justice C.V. Bhadang (President) observed that All that the communication stated was about the provision of a facility for the generation of Intimation Letters containing Document Identification Number/Document Number (DIN/DN) for documents issued outside the ITBA system but uploaded manually in the Income Tax Business Application (ITBA). In the result, the Appeals of the Assesses are allowed and the assessment orders are set aside.
The Mumbai bench of the Income Tax Appellate Tribunal observed that Mistakes from typographical error not leading to tax evasion is not unexplained cash credit.
After reviewing arguments and records, the two member bench of the tribunal comprising Rahul Choudhari (Judicial member) and Om Prakash Kant (Account member) concluded that the key question was whether a discrepancy in declaring a higher value for the share of profit from partnership firms, compared to the actual share, qualified as an unexplained cash credit under Section 68 of the Income Tax Act 1961.
The Ahmedabad bench of the Income Tax Appellate Tribunal ( ITAT ) observed that onus is on Income Tax Department, to bring corroborative material to tax amount credited in foreign bank account of Non- Resident Indian ( NRI )
The two member bench of the tribunal comprising T.R Senthil Kumar (Judicial member) and Waseem Ahammed (Account member) concluded that The revenue, burdened by the assesseeâs non-resident status, needed corroborative material to tax the foreign bank account credits. The assessee, a resident but not an ordinary resident for A.Y.s 2000-01 to 2003-04, faced a reopened assessment with no additions for deposits in Citibank NA Singapore or Habib Bank AG Zurich. The revenue treated these deposits as arising outside India and beyond Indian control. Affirmed the CIT(A)âs order, dismissing the revenueâs appeal.
The Income Tax Appellate Tribunal ( ITAT ), Delhi bench, dismissed the refund of excess Dividend Distribution Tax- DDT paid to non-resident companies. The assessee, Sennheiser Electronics India Private Limited, is engaged in the business of sales and distribution of headphones, microphones, monitoring systems, tour guide systems, and aviation headsets. It imports goods from Sennheiser group companies for resale through its distributors in India.
After reviewing the facts and records, the two-member bench of Padmavathy S ( Accountant Member ) and Amit Shukla ( Judicial Member ) dismissed the refund of excess Dividend Distribution Tax paid to non-resident companies. Poonam Ahuja, Advocates, appeared for the assessee, and Sanjay Kumar, counsel, appeared for revenue. Therefore, the bench dismissed the appeal filed by the assessee.
The Income Tax Appellate Tribunal (ITAT), Ahmedabad bench upheld the order of canceling deduction of Tax Deduction at Source at 20% on payment made by the Indian Company for damage of vessels
After reviewing the facts and records, the two-member bench Of Waseem Ahmed (Accountant member
) and Madhumita Roy,(Judicial Member) upheld the order of canceling deduction of Tax Deduction at Source at 20% on payment made by the Indian Company for damage of vessels Hence the bench dismissed the appeal of the revenue.
The Chennai bench of The Income Tax Appellate Tribunal (ITAT) dismissed the income tax appeal, citing no bonafide cause for the 1040-day delay in filing.
The two member bench of the tribunal comparing Manomohandas (Judicial member) and Manju Natha
G. (Account member) observed that after a thorough evaluation, it was determined that the assessee did not present a reasonable and bona fide cause to condone the 1040-day delay in filing these appeals. As a result, the appeals filed by the assessee for all three assessment years were dismissed as unadmitted. In the result, the appeals filed by the assessee for all three assessment years were dismissed
The Pune bench of the Income Tax Appellate Tribunal ( ITAT ) observed that Interest expenditure incurred on capital allowable as deduction under Section 24 of Income Tax Act 1961 and not part of cost acquisition.
The single member bench of the tribunal comprising Inturi Rama Rao ( Account member ) concluded that the cost of acquisition of property also forms an integral part of the sale of property. Therefore, it cannot be said that the Officer had traveled beyond the items for which the case was selected for scrutiny assessment. Accordingly, the grounds of appeal/additional grounds of appeal filed by the assessee stood dismissed. In the result, the appeal filed by the assessee was dismissed.
The Bangalore bench of the Income Tax Appellate Tribunal (ITAT) granted an exemption on capital gains related to the transfer of a residential property, despite a 10-year delay in the verification process by the Assessing Officer (AO).
The two member bench of the tribunal comprising Chandra Poojari ( Account member) and Beena Pillai ( Judicial member) concluded that After examining the sale deed dated 09.11.2012, it became evident that the assessee had transferred a residential property, making them eligible for exemption under Section 54 of the Income Tax Act 1961,
The Mumbai Bench of the Income Tax Appellate Tribunal has ruled in favour of Vodafone Idea, granting relief by allowing deduction under Section 80IA of the Income Tax Act 1961, for undertakings for providing telecommunication services.
The two member bench of the tribunal comprising Pavan Kumar Gadale (Judicial Member) and B.R. Baskaran( Accountant Member) concluded that the assessee initiated telecommunication services after April 1, 1995, rendering them eligible for deduction under section 80IA(4) of the Income Tax Act 1961. Subsequently, the assesseeâs deduction claims for the assessment years 2006-07 and 2007-08 were granted, following this established precedent. In the recent assessment year, the denial of the
assesseeâs deduction claim corresponds with the rationale applied in the assessment year 2006-07.
The Bangalore bench of the Income Tax Appellate Tribunal (ITAT) observed that the Sale receipts already recorded as income or loss at time of sale was unexplained cash credit under Section 68 of Income Tax Act 1961.
The two member bench of the tribunal comprising Chandra poojari (Account member) and Beena Pillai (Judicial member) observed that the absence of any evidence casting a shadow on the purchase of shares, a fact clearly documented in the assesseeâs books. Once the purchase or transfer of shares was
duly acknowledged in the relevant assessment year, any disruption to the corresponding sales required irrefutable evidence or findings. Consequently, we found no justification in the rationale presented by the Assessing Officer and the Commissioner of Income Tax (Appeals) to include the addition under Section 68 of the Income Tax Act 1961 in the assesseeâs financial obligations. From our perspective, the addition made should have been expunged. In the result, the appeal filed by the assessee stands partly allowed.
The Income Tax Appellate Tribunal (ITAT), Delhi bench, while directing readjudication, observed that the notice for continuing assessment proceedings of deceased persons was issued in the individual name instead of Hindu Undivided Family (HUF).
After reviewing the facts and records, the two-member bench of Shamim Yahya (Accountant Member) and Kul Bharat (Judicial Member) restored the matter to the file of the AO, who would verify and decide the objections raised by the assessee regarding the assessment proceedings of the deceased person issued in the individual name instead of HUF.
The Chennai bench of the Income Tax Appellate Tribunal ( ITAT ) set aside the order of the Commissioner of Income Tax ( Exemption ) [CIT(E)] assessment order passed under section 263 of the Income Tax Act, 1961 as Assessing Officer ( AO ) made thorough scrutiny.
A two-member bench comprising Shri Manjunatha G, Accountant Member and Shri Manomohan Das, Judicial Member that the assessment order passed by the AO is neither erroneous nor prejudicial to the interest of the Revenue. The AO has considered the issue of exemption under section 11 of the Act, while completing assessment under section 143(3) of the Act, which is evident from the assessment proceedings, where, the AO has called for various details. The ITAT held that the CIT ( Exemptions ) erred in invoking their jurisdiction and set aside the assessment order passed by the Assessing Officer under section 263 of the Act.
The Income Tax Appellate Tribunal (ITAT), Bangalore bench, directed readjudication regarding depreciation claims on goodwill arising from the acquisition of business under a slump sale. I&B Seeds Private Limited, the assessee, a private limited company engaged in R&D, production, and marketing of hybrid seeds, purchased proprietary concerns from Mr. Praveen Noojibail and M/s. Sasya Gentech Private Limited during AY 2015-16. The assessee claimed depreciation on the goodwill, the amount paid to the transferors beyond the value of net assets taken over.
Following a review of facts and records, the two-member bench consisting of Chandra Poojari (Accountant Member) and Beena Pillai (Judicial Member) directed readjudication concerning depreciation claims on goodwill arising from the acquisition of business under a slump sale, considering the final outcome of the decision in the case of M/s. Padmini Products Pvt. Ltd. To Read the full text of the Order CLICK HERE
The Delhi bench of Income Tax Appellate Tribunal ( ITAT ) has ruled that even if the gross receipts of the assessee exceeds the threshold limit prescribed in the proviso under Section 2(15) of the Income Tax Act, 1961, still there is no need for cancellation of the registration under Section 12AA(3).
The bench of Anubhav Sharma (Judicial Member) and M. Balaganesh (Accountant Member) stated that for that particular year alone, the assesseeâs activities would not to be construed as charitable activities and assessee would be subjected to tax as a normal business assessee. This fact is duly clarified by the CBDT No. 21/2016 dated 27.05.2016. Hence, the bench granted approval to the raised grounds and
accepted the assesseeâs appeal.
In a recent case, the Delhi High Court, while upholding the order of the Income Tax Appellate Tribunal ( ITAT ), held that payment received from the sale/supply of software is not royalty under Article 12(3) of the India-Singapore Double Taxation Avoidance Agreement ( DTAA ).
Therefore, a division bench of Justice Rajiv Shakdher and Justice Girish Kathpalia held that payment received from the sale/supply of software is not royalty under Article 12(3) of the India-Singapore DTAA. Satyen Sethi and Mr. Arta Trana Panda, Advocates, appeared for the petitioner, and Ruchir Bhatia, Advocate, appeared for the respondent.
The Hyderabad bench of the Income Tax Appellate Tribunal( ITAT ) has held that deduction on physical fitness expenses is not allowable in the absence of evidence to prove the expenses were for professional purposes.
A two-member bench comprising of Shri R K Panda, Vice President and Shri Laliet Kumar, Judicial Member while dismissing the appeal observed that âThough the physical fitness was a part and parcel of assesseeâs profession it cannot be held to be incurred wholly and exclusively for the profession of the assessee. Even the assessee has not filed any evidence to show that he underwent any weight loss program to fulfil his professional commitment. Hence, we do not find any reason to interfere with the finding of ld.CIT(A) on this issue. Thus, this ground of the assessee dismissed
The Mumbai bench of the Income Tax Appellate Tribunal ( ITAT ) upheld the order of the Commissioner of Income Tax (Appeals) which validated the Transfer Pricing ( TP ) report by holding that rejecting the TP analysis without giving any specific reason is invalid.
A two-member bench comprising Shri Kuldip Singh (Judicial Member) and Ms Padmavathy S (Accountant Member) upheld the findings given by the CIT(A) and dismissed the appeal of the revenue regarding the TP adjustment.
In a recent case, the Income Tax Appellate Tribunal (ITAT) observed that foreign exchange loss cannot be included in the cost of the project and allowed it as a Deduction.
A two-member bench comprising Shri Kuldip Singh (Judicial Member) and Ms Padmavathy S (Accountant Member) observed that the foreign exchange gain or loss arises when the amount of sundry creditors outstanding at the time of payment is settled. The sundry creditors are the monetary items as per the Ind As 21.
In a recent case, the Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that investment in gold and foreign companies should be excluded but while computing the disallowance under section 14A r.w.r.8D(2)(iii) had included the same and upheld the order of the Commissioner of Income Tax(Appeals).
A two-member bench comprising Shri Kuldip Singh (Judicial Member) and Ms Padmavathy S (Accountant Member) observed that the disallowance under section 14 A of the act added by the assessing officer while computing the book profit under section 115JB of the act.
The Hyderabad bench of the Income Tax Appellate Tribunal ( ITAT ) has held that disallowance under section 14A of the Income Tax Act, 1961 only covers expenses regarding exempt income.
A two-member bench comprising of Shri R K Panda, Vice President and Shri Laliet Kumar, Judicial Member found that CIT(A) while passing his order has categorically mentioned that disallowing Rs.50,000/- under section 14A of the Act is fair and reasonable to cover up any expenses as such concerning exempt income and granted part relief to the assessee. While dismissing the appeal, the ITAT upheld the findings of the CIT(A).
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) observed that the directorâs salary and
handover facility expenses are incurred yearly and are business expenses.
A two-member bench comprising Shri Kuldip Singh (Judicial Member) and Ms Padmavathy S (Accountant Member) upheld the decision of the CIT(A) and dismissed the appeal of the revenue.
The Delhi bench of the Income Tax Appellate Tribunal (ITAT) held that the Employeeâs ESOP
compensation expense can be allowable as business expenditure as it was used to retain the talent
/staff for the benefit of the company.
While holding in favour of the Assessee, the two-member bench comprising Shri Saktijit Dey, Vice President & Shri Pradip Kumar Kedia, Accountant Member noticed that the assertions made on behalf of the Assessee that similar claim had been allowed in the earlier years by the AO. While allowing the appeal, the ITAT directed the AO to reverse disallowance.
The Income Tax Appellate Tribunal (ITAT) observed that the claim of 50 % depreciation on a sample flat used for less than 180 days is allowable and deleted the disallowance. It was found that the revenue has not disputed the fact that the sample flat is a temporary structure and no contrary findings being brought on record.
A two-member bench comprising Shri Kuldip Singh (Judicial Member) and Ms Padmavathy S (Accountant Member) observed that the revenue has not disputed the fact that the sample flat is a
temporary structure and no contrary findings being brought on record. The ITAT held that the assesseeâs claim of 50% of the cost of construction for the year under consideration is allowed. The disallowance made in this regard was deleted.
The Bangalore bench of the Income Tax Appellate Tribunal (ITAT) has held that interest earned from commercial /cooperative banks having a license under the Banking Regulation Act is considered under Head of Income From Other Sources.
A two-member bench comprising Shri Chandra Poojari, an Accountant Member and Smt Beena Pillai, a Judicial Member held that the interest income earned by a cooperative society on its investments held with a cooperative bank that does not have a license under section 22 of the Banking Regulation Act 1949, falls outside the definition the term, âBanking Companyâ as per section 2(c ) of the Banking Regulations Act, 1949, would be eligible for claim of deduction under Sec.80P(2)(d) of the Act. The AO is thus directed to carry out necessary verification in respect of that same to consider the claim of deduction under section 80 P(2)(d) of the Act.
The Delhi bench of the Income Tax Appellate Tribunal (ITAT) observed that Commission Paid to Agents Outside India does not Fall under section 9(1)(vii) of the Income Tax Act, 1961 in the absence of any services of a technical nature and set aside the disallowance of expense made by the Assessing Officer (AO).
A two-member bench comprising Shri Saktijit Dey, Vice President & Shri Pradip Kumar Kedia, Accountant Member observed that the overseas agents were paid commission for securing orders etc., and such services were utilized to make or earn income from a source outside India, the assessee is under no obligation to apply with provisions of Section 195 of the Act for the reasons that commission to such overseas agents are not taxable under the Act. The AO has not alleged or established anything to the contrary. The AO was thus not justified to disallow such commission expenses under the Act.
The New Delhi Bench of the Income Tax Appellate Tribunal ( ITAT ) ruled that âLive Rightsâ are not âcopyrightâ, any payments made are not taxable as royalty.
A Two-Member Bench comprising Saktijit Dey, Vice President and Dr. B. R. R. Kumar, Accountant Member observed that âWe hold that broadcasting âLive eventsâ does not amount to a work in which copyright subsists, meaning thereby right to broadcast live events i.e ., âLive Rightsâ , is not âcopyrightâ and therefore any payment made thereto canât be said to be chargeable to tax as royalty under Section 9(1)(vi).â
We find that the payments in dispute are made to overseas rights holder. The said payments are neither made to any satellite operators nor for use of any satellite. Thus, the payments in dispute are not made for use of any âprocessâ as defined under Section 9(1)(vi) of the Act and canât be charged to tax as
âRoyaltyâ in the hands of the overseas rights holders. Accordingly, we hold that the AO while passing the order under Section 201 of the Ac t has erred in law by treating the remittances to have been made for use of a âProcess.â
The Mumbai Bench of the Income Tax Appellate Tribunal ( ITAT ) observed that Non Resident status can be given to a taxpayer who stayed in India for 176 days under Explanation 1(a) to Section 6(1) of Income Tax Act, 1961.
A Two-Member Bench comprising Prashant Maharishi, Accountant Member and Sandeep Singh Karhail, Judicial Member observed that âWe are of the considered view that by applying the ratio of aforesaid decisions the assessee is entitled to claim the benefit of the extended period of 182 days, as provided in Explanation-1(a) to section 6(1) of the Income Tax Act, for the determination of residential status. Since it is undisputed that the assessee has stayed in India only for a period of 176 days during the year, which
is less than 182 days as provided in Explanation 1(a) to section 6(1) of the Income Tax Act, the assessee
has rightly claimed to be a âNon-Residentâ during the year for the purpose of the Income Tax Act.â
The Delhi bench of the Income Tax Appellate Tribunal ( ITAT ) Purchase expenditure is outflow against income falling within ambit of under Section 68 of Income Tax Act 1961.
The single member bench of the tribunal comprising Pradip Kumar Kediya ( Account member ) observed that the assesses council meticulously detailed the transaction, revealing a discrepancy in the Assessing Officerâs case. The inclusion of purchase consideration, based on alleged investor profit manipulations from a SEBI report, raised questions about potential scrutiny of capital gains. Importantly, the Assessing Officer, without questioning the sourceâs legitimacy, added the entire purchase cost under Section 68. However, Section 68 of Income Tax Act 1961 didnât seem initially applicable, as it addressed inflows, not outflows like purchase costs. Consequently, the Assessing Officerâs addition seemed to lack a solid foundation based on an unsupported premise.
The Mumbai bench of the Income Tax Appellate Tribunal ( ITAT ) provided relief to Bajaj Auto by allowing a deduction under Section 80-O of the Income Tax Act, 1961 for the royalty fee received, recognizing it as pertaining to drawing, design, invention, patent, and trademark.
The two member bench of the tribunal comprising Aby T Varkey ( Judicial member ) and Amarjith singh ( Account member ) observed that Assessment Year 1998-99, where the decision favored by the assessee. The bench noted that, in accordance with the agreement, the assessee granted a license for the assembly of its scooter models. The assessee permitted this process and provided the necessary subsequently receiving a technical know-how fee.
The Mumbai bench of the Income Tax Appellate Tribunal ( ITAT ) observed that tax implications and neutrality of transaction play a pivotal role in determining applicability under Section 40A(2)(a) of Income Tax Act, 1961.
The two member bench of the tribunal comprising Rahul Chowdhury ( Judicial member ) and Om Prakash Kant ( Account member ) affirmed that even if it is assumed that the payment was excessive,the fact that the subsidiary has been taxed at the same rate makes it a tax-neutral exercise. This conclusion was drawn as there was no apparent case of tax evasion, leading to the deletion of the disallowance.
The Delhi bench of the Income Tax Appellate Tribunal ( ITAT ) dismissed the imposition of penalty under section 271(1)(c) of the Income Tax Act 1961, citing the Assessing Officerâs rejection of fair market value supported by a valuation report.
The single bench of the tribunal comprising Pradeep Kumar Kediya ( Account member ) observed that the penalty imposition appears unwarranted for several reasons. Firstly, the Assessing Officer disregarded the fair market value, backed by a valuation report. While additions under section
56(2)(viib) of the Income Tax Act 1961 might be justifiable, it doesnât automatically imply concealment,
as asserted in the assessment order.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) has rejected the claim for the deduction of expenditure on a masala grinder and toaster, as reported under capital expenditure in the tax audited report.
The two member bench of the tribunal comprising Aby T Varkey (Account member) and Amarjith Singh (Judicial member) noted that the aforementioned amount was indicated as capital expenditure in the tax audited report and was also disallowed in the income tax return. Consequently, it is concluded that the disallowance of this expenditure is not warranted. Therefore, we instruct the AO to eliminate the addition made towards the expenditure on the Masala Grinder and Toaster, subject to verification of the assesseeâs claim.
The Delhi bench of the Income Tax Appellate Tribunal ( ITAT ) directed the Assessing Officer ( AO ) to conduct a fresh assessment due to the inadequacy of the inquiry into the source of fresh capital
The two member bench of the tribunal comprising Challa Nagendra Prasad ( Judicial member ) and G.S Pannu ( Vice President ) concluded that the assessment order dated 14.03.2014 was erroneous and prejudicial to the interests of revenue. The order was set aside with directions to the AO to pass a fresh assessment order after a thorough examination of the case, considering all available evidence on record, or that may be produced or furnished by the Assessee.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) has instructed the Assessing Officer (AO) to restrict the disallowance percentages for aggregate expenditure, conveyance charges, office maintenance, Sunday, and business promotion expenses due to the non-production of complete bills and vouchers.
The Single member bench of the tribunal comprising Pavan Kumar Gadale( Judicial member) observed that CIT (A) overlooked crucial evidence, per the arguments presented by the counsel for the assessee, who contended that the Assessing Officer (AO) failed to specify a particular expenditure item for
disallowance. The AOâs presumptive estimations of disallowances on legitimate business expenditures incurred, based on incomplete bills and vouchers, were contested. Ledger account copies supporting the claims were provided. The bench concluded that the counsel for the assessee emphasized past and subsequent yearsâ expenditure percentages relative to business turnover. Recommending a reversal of
the CIT(A)âs decision, directing the AO to restrict disallowances to 3% (from 10%) for aggregate expenditures and 2% (from 5%) for office maintenance in the current assessment year. Partially favoring the assesseeâs appeal.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) has dismissed the imposition of interest under section 234A of the Income Tax Act 1961, stating that income tax cannot be levied on income that has already been paid.
The two member bench of the tribunal comprising Rahul Choudhari ( Judicial member) and Om Prakash Kanth( Account member) concluded that taking into account the assesseeâs assertion that the self- assessment tax had already been paid, and considering the failure to file a return due to circumstances beyond the assesseeâs control, The bench hereby remanded the matter of interest imposition under section 234A of Income Tax Act 1961 back to the Assessing Officer. The Assessing Officer was instructed to make a decision in accordance with the applicable laws.
The Mumbai bench of the Income Tax Appellate Tribunal ( ITAT ) observed that Business receipt or unexplained cash receipt can be assessed u/S 69 A of Income Tax Act 1961.
The two member bench of the tribunal comprising Rahul Choudhari ( Judicial member ) and Om Prakash Kant ( Account member ) observed that to categorize those cash receipts as business receipts, the assessee was required to disclose the names and addresses of the parties from whom the cash was received, i.e., the source. Since the assessee had not provided this crucial information, section 69A of the Income Tax Act,1961, was deemed applicable.
The Mumbai bench of the Income Tax Appellate Tribunal ( ITAT ) delivered a setback to Bajaj Auto by allowing the deduction under Section 80 IA of the Income Tax Act 1961 only after deducting depreciation from the profits of eligible undertakings.
The two member bench of the tribunal comprising Aby T varkey ( Judicial member ) and Amarjith Singh (Account member) noted that a similar issue with identical facts in the cases of the assessee has already been decided against the assessee for the Assessment Years 1993-94 to 1998-99, In line with the decision of the co-ordinate bench mentioned above, the appeal ground of the assessee was dismissed.
The Mumbai bench of the Income Tax Appellate Tribunal ( ITAT ) observed that Surplus on Redemption of Treasury bill is to be taxed under Capital Gains.
The two member bench of the tribunal comprising Abi T Varkey ( Judicial member ) and Amarjit Singh ( Account member ) had ruled in favor of the assessee. The bench following the decision of the Supreme Court in CIT v/s Grace Collis had determined that the surplus on the redemption of treasury bills should be taxed under the head Capital Gains. Therefore, in alignment with the coordinated benchâs decision, the Assessing Officer was directed to assess the same as capital gains.
The Mumbai bench of the Income Tax Appellate Tribunal ( ITAT ) has granted relief to Bajaj Auto Ltd by allowing a deduction under Section 40(a) (i) of the Income Tax Act 1961, for expenditures incurred in foreign currency.
Consequently, no tax was deducted for these transactions. In the course of the appellate proceedings, the revenue failed to present any substantial evidence contradicting the findings established by the Commissioner of Income Tax ( Appeals ). As a result, this ground of appeal by the revenue has been dismissed due to a lack of merit.
The Income Tax Appellate Tribunal ( ITAT ) allowed deduction under Section 80G of the Income Tax Act 1961 on Corporate Social Responsibility ( CSR ) expenses The assessee, operating in real estate construction and development, filed its income tax return for the relevant year on 14/01/2021, declaring a total income of Rs. 71,49,06,790. The filed return underwent scrutiny, and statutory notices under sections 143(2) and 142(1) of the Income Tax Act 1961, were issued. During the assessment, it was observed that the assessee claimed an interest expense of Rs. 7851 lakh at the rate of 21.3% on debentures.
The two member bench of the tribunal comprising Om Prakash Kanth ( Account member ) and Sandeep Singh Krahail (Judicial member) observed that the consistently favored the assesseâs position. They maintained that despite the non-allowance of CSR expenses under section 37 of the Income Tax Act 1961, following the insertion of Explanation-2 to section 37 of the Income Tax Act 1961 by the Finance Act, 2014, effective from 01/04/2015, such expenditures were still permissible under section 80G of the Income Tax Act 1961. The CIT(A) similarly adhered to these judicial precedents and rendered a favorable decision for the assessee.
The Delhi bench of the Income Tax Appellate Tribunal ( ITAT ) directed the Assessing Officer ( AO ) to conduct a fresh assessment due to the inadequacy of the inquiry into the source of fresh capital.
The two member bench of the tribunal comprising Challa Nagendra Prasad ( Judicial member ) and G.S Pannu ( Vice President ) concluded that the assessment order dated 14.03.2014 was erroneous and prejudicial to the interests of revenue. The order was set aside with directions to the AO to pass a fresh assessment order after a thorough examination of the case, considering all available evidence on record,or that may be produced or furnished by the Assessee. The bench observed that the AO had not properly examined the source, especially considering that in the earlier assessment year 2010-11, fresh capital introduced by the assessee was found unexplained by the AO.
The Delhi bench of the Income Tax Appellate Tribunal ( ITAT ) dismissed the imposition of penalty under section 271(1)(c) of the Income Tax Act 1961,citing the Assessing Officerâs rejection of fair market value supported by a valuation report.
The bench observed that the Assessing Officer (AO) altered the grounds for imposing the penalty, moving from the initial accusation of concealing income to asserting âfurnishing inaccurate particulars of incomeâ during the penalty proceedings. This change raised legal questions. Similarly, the CIT(A) was not authorized by law to independently uphold the AOâs action without considering the satisfaction derived during the assessment. Consequently, the imposition of the penalty lacked validity on this basis. The bench concluded that thus seen from any angle, the imposition of penalty under section 271(1)(c) of the Income Tax Act 1961 in the present set of circumstances was unsustainable in law. set aside the first appellate order and direct the AO to reverse and cancel the penalty. In the result, appeal of assessee was allowed.
The Mumbai bench of the Income Tax Appellate Tribunal ( ITAT ) quashed the assessment order of the Commissioner of Income Tax ( appeals ) acknowledging that the non-appearance due to continuation of information gathering process not deliberate act.
The two member bench of the tribunal comprising Pathmavathy ( Account member ) and Pavan Kumar Gadali ( Judicial member ) observed that the CIT( A ) based the decision on the assesseeâs non- appearance, despite seeking an adjournment and being provided with ample hearing opportunities. The CIT( A ) concluded that the assessee displayed a lack of interest in pursuing the appeal and subsequently dismissed it based on the existing records. The grounds of appeal challenged the Assessing Officerâs additions, and various reasons for non-appearance could be considered. Upholding the principles of natural justice, the bench chose to grant the assessee another hearing opportunity.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) dismissed appeal due to non- appearance and failure to submit documentation for exemption claim under Section 54 of the Income Tax Act 1961
The two member bench of the tribunal comprising Gagan Goyal (Account member) and Narendar Kumar Choudhary (Judicial member) concluded that Assessee neither appeared nor filed an adjournment application. The appeal was decided ex parte. The authorities noted that the Assessee, despite claiming exemption of Rs.1,05,00,000/- under section 54 of the Income Tax Act 1961 for investment in house property, failed to provide supporting documents. The denial of the claim was affirmed, as no contrary reason or material was found against the Commissionerâs findings.
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