![ITAT Annual Case Digest 2023 - [Part 3] - TAXSCAN](https://staging.taxscan.in/wp-content/uploads/2024/01/ITAT-Annual-Case-Digest-2023-Part-3-TAXSCAN.jpg)
This yearly digest analyzes all the ITAT stories published in the year 2023 at taxscan.in
In Kacharu Madhukar Shinde vs The Joint Commissioner of Income Tax,The Pune Bench of Income Tax Appellate Tribunal (ITAT) has upheld the penalty imposed under Section 271E as the repayment of loan in cash had exceeded Rs. 20,000.
The Pune Bench of Dipak P Rippotte (Accountant Member) and S SGodara(Judicial Member) held that the assessee was liable for penalty u/s 271E and uphold the penalty u/s 271E as the assessee had repaid loan in cash in excess of Rs.20,000/- and also had not submitted any sufficient cause for such payment. The bench dismissed the appeal of the assessee.
In VIC Enterprises Pvt. Ltd vs ACIT ,The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has held that the scholarship to students not associated with the company for any commercial or business purpose would not be allowed as deduction.
The Delhi Bench of B R R Kumar (Accountant Member) and Yogesh Kumar US (Judicial Member) observed that the incumbent student was neither an employee nor associated with the company for any commercial or business purpose. The bench also observed that the expediency of sponsoring the student had not been brought on record nor the student had contributed in any manner for augmenting, contributing to the business of the assessee.
In ACIT vs M/s Shoppers Stop Limited,Income Tax Appellate Tribunal (ITAT) Mumbai Bench ruled that Sales or Return (SOS) agreements did not fall within the ambit of Section 194C of the Income Tax Act, 1961 and therefore the assessee did not have any liability to deduct tax at source on such payments under section 194C of Income Tax Act.
The AO noted that the term outlets model was ’Sales or Return‘ being used by the assessee for their business misleading and was an attempt to evade the rigours of Section 194C of the Income Tax Act. According to the AO, these facts indicated that the contract between the assessee and vendors were ‘contracts of work &labour’ not ‘contracts of supply’. The bench of Amarjit Singh (Accountant Member) and Aby T. Varkey (Judicial Member) uphold the decision of CIT(A).
In Shri Narendra Shantikumar Firodia vs Dy. Commissioner of Income Tax,The Income Tax appellate tribunal (ITAT) in a case recently held that Section 50C (1) of the Income Tax Act 1961 cannot be invoked in case of transfer of leasehold rights.
As per section 50C (1) of the Income Tax Act 1961 refer that an assessee received any consideration by way of transfer of asset it may be land, or building, or both in such a case the value of the asset is less than that assessed by the authority of state government for the purpose of payment of stamp duty, the assessed value is consider as the full value of the consideration in case of result of the above transfer.
The Division bench of ITAT Pune comprising G. D. Padmahshali, Accountant Member, and SS Viswanethra Ravi, Judicial Member, allowed the appeal and held that the transaction of transfer of leasehold right in question did not warrant invoking of section 50C(1) of the Income Tax Act 1961.
InPrasanta Kumar Mishra vs ACIT,Income Tax Appellate Tribunal (ITAT) recently allowed non -resident Indian (NRI) vto rectify Income Tax Return after seven years as tax benefit was not claimed by mistake.
the ITAT bench allowed the appeal filed by the assessee and held that the “Assessing Officer is at liberty to examine whether the assessee was NRI during the relevant point of time and whether he is entitled to the benefit of exemption under section 5 (1) (c) read with section 6 of the Income Tax Act 1961”.
In Rohit Infra Projects Pvt.Ltd vs DCIT, Central Circle-2 B, The Mumbai Bench of Income Tax Appellate Tribunal (ITAT)has held that the Assessing Officer should consider a valid revised return while completing the assessment.
The Bench of Gagan Goyal (Accountant Member) and Aby T Varkey (Judicial Member) held that the Assessing Officer had erred in not considering the revised return filed by the assessing officer. The bench allowed the petition and seaside the impugned order directing the Assessing officer to make fresh assessment considering the revised return.
In Oxford University Press vs DCIT, Income Tax Appellate Tribunal (ITAT), Mumbai Bench recently held that payment by Oxford University press towards school support services for referring students constitutes brokerage.
the ITAT bench comprising M. Balaganesh (Accountant Member) and Kavitha Rajagopal (Judicial Member) and conclude that the assessee is bound to deduct tax at source, failure of which would be invited with disallowance under section 40(a) (ia) of the Income Tax 1961.
Section 194H of the Income Tax Act 1961 deals that Tax Deduction at Source should be levied on the earnings received as commission or brokerage. Section 40(a) (ia) of the Income Tax 1961 expenditure mentioned under the heads of TDS, such amount paid and deducted profit and loss account of resident would not be allowed as deduction while computing the income under the heads of Profit and Loss account.
IN Sh. Vijay Sharma vs ACIT, Circle-II,The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has recently held that capital gain exemption under Section 54 is not allowable in cases where the builder has not started construction of house.
It was also contended that the Commissioner of Income Tax (Appeals) [CIT(A)] has wrongly concluded that it is a case where the developer was not having necessary approval from the government to construct residential units and that it is not a case that the assessee was not offered possession.
The approval of the zonal plan and delivery of possession happened by 18.08.2022 whereas the land was purchased on 17.12.2014. Section 54 of the Income Tax Act allows for an exemption on long-term capital gains tax for individuals and HUF (Hindu Undivided Family) if the proceeds from the sale of a long-term capital asset, such as residential property are invested in the purchase or construction of another residential property within a specified time frame.
In,VipinMadanlal Thapar 502 vs DCIT, The Mumbai Bench of Income Tax Appellate Tribunal (ITAT), consisting of Amit Shukla, Judicial Member and Amarjit Singh, Accountant Member held that no income tax addition can be made when expenses are shown under Work in Progress (WIP) and not added in trading account.
Return of income declaring total income was filed by the assessee, Vipin Madanlal Thapar. The case was subject to scrutiny assessment and notice under Section 143(2) of the Income Tax Act was issued. The assessee was a proprietor of Shubham Builder and Developers and a director in Swaraj Formulation Pvt Ltd.
The Bench observed that “We have considered the judicial pronouncements referred by the Counsel wherein it is held that since the expenses were shown by the assessee under the head work in progress and has not been reflected in the trading account, therefore, no addition can be made.”
In the case Motorola Solutions India Pvt. Ltd. vs ACIT,The New Delhi Bench of the Income Tax Appellate Tribunal (ITAT), invalidated the assessment order in the name of a non-existent entity. The Counsel for the assessee submitted that as per the order passed by the High Court of Punjab & Haryana, M/s. Motorola India Pvt. Ltd., as it was then, merged with M/s. Motorola Solutions India Pvt Ltd., the present assessee.
The Bench comprising GS Pannu, President and Saktijit Dey, Judicial Member observed that “Thus, in our view, in the facts of the present case, the ratio laid down by the Supreme Court in case of PCIT Vs. Suzuki India Ltd would squarely apply. Thus, respectfully applying the ratio laid down by the Hon’ble Supreme Court in case of PCIT Vs. Maruti Suzuki India Ltd, we hold that the assessment order, having been passed in the name of a non-existent entity, is invalid.”
The Mumbai Bench of the Income Tax Appellate Tribunal ( ITAT ), ruled that the Principal Commissioner of Income Tax ( PCIT ) cannot order conditional approval under Section 80G of the Income Tax Act, 1961. M/s. Lady Tata Memorial Trust and M/s. Lady Meherbai D. Tata Education Trust, the assessees being a charitable trust sought to grant the registration with effect from 23.03.2022 to A.Y. 2024-25 under section 80G of the Income Tax Act, 1961 for the assessment year 2022-23 after complying with the requisite formalities.
A Bench comprising Kuldip Singh, Judicial Member and S Rifaur Rahman, Accountant Member noted that “Consequently, approval granted by the PCIT/CIT under section 80G of the Act to the assessees is made absolute sans conditions of the impugned order. Hence, both the appeals filed by the assessee are allowed.
In,ACIT vs Tupelo Builders Pvt. Ltd,The Delhi bench of the Income Tax Appellate Tribunal ( ITAT ) has held that income earned by the Builder from letting out of the property is assessable under the heading of “Income from Business” when the objective in MOA is letting out of Property.
M/s Tupelo Builders Pvt. LtdTheAssessee a Private Limited Company e-filed its original return of income for the assessment year under consideration on 19.09.2015 declaring a loss of Rs.7,07,00,678/- under the head “Income from Business”.
A Coram comprising of Shri G S Pannu, President and Shri Challa Nagendra Prasad, Judicial Member observed that as from the MOA, it was evident that the main objects of the assessee company are to construct, acquire hold buildings, tenements and such other movable and immovable property and to rent let on hire and managed immovable property.
In Smt. Nagina Kochar vs The PCIT-1,The Income Tax Appellate Tribunal (ITAT), Chandigarh Bench, has recently in an appeal filed before it, held that the revisional authority shall avoid the attitude of “I have the power and I shall exercise”.
The aforesaid observation was made by the Chandigarh ITAT, when an appeal was preferred before it by an assessee, wherein the correctness of the order dated 26.03.2021, of the Pr .CIT, Chandigarh, pertaining to the assessment year 2016-17 had been assailed, on the grounds that the Principal Commissioner of Income Tax has wrongly assumed jurisdiction under section 263 of the Income Tax Act, to set aside the assessment order dated 26.11.2018 passed by the Assessing Officer, in as much as the order is neither erroneous nor prejudicial to the interest of Revenue, that as such the assumption of jurisdiction under section 263 of the Income Tax Act is beyond his competence, and further that the Principal Commissioner of Income Tax, has erred in failing to consider the various replies and submissions placed on record in proceedings before her in the correct perspective, which is arbitrary and unjustified.
In Menzies Aviation Bobba (Bangalore) Pvt. Ltd. vs Assistant Commissioner of Income Tax,In a significant ruling, the Income Tax Appellate Tribunal ( ITAT ), Bangalore bench has held that the rental income which is inseparably connected with the business of cargo handling services shall be eligible for income tax deduction under section 80IA of the Income Tax Act, 1961
ITAT held that the rental income derived by the assessee from Cargo Agents, Airlines, Banks etc., is derived from the cargo business and eligible for deduction u/s. 80IA,”
In,Deputy Commissioner of Income Tax vs M/s Vinati Organics Ltd 1102,
The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) granted relief to M/s Vinati Organics Ltd, the assessee and confirmed treating sale tax subsidy received as capital receipt
The return of income declaring total income of Rs.71 crores was filed and the case was subject to scrutiny assessment and notice under Section 143(2) of the Income Tax Act was issued.
Dismissing the appeal filed by the Revenue a Bench comprising Amit Shukla, Judicial Member and Amarjit Singh, Accountant Member observed that during the course of appellate proceedings the Counsel also submitted that in subsequent year assessment year 2013- 14 the CIT(A) allowed the appeal of the assessee treating sale tax subsidy as capital receipt and department has not raised any ground before the ITAT.
In,Kishor Ganpatrao Karande vs The Income Tax Officer,The Pune bench of the Income Tax Appellate Tribunal (ITAT) deleted the income tax addition as the compensation on compulsory acquisition of land is exempted under section 10(37) of the Income Tax Act,1961.
A Coram comprising of Shri S SViswanethra Ravi, Judicial Member observed that the assessee was into agricultural activity by sowing Bajara in his land for F.Y. 2008-09 and the same has been shown as paid in the revenue records in 7/12 extract due to lack of rain and drought. The assessee establishes the reasons for classification as barren land due to the non-availability of irrigation facilities. Therefore, the assessee is entitled to claim an exemption under section 10(37) of the Income Tax Act.
in,Sonicwall Technology System India Pvt. Ltd vs Asstt. Commissioner of Income,The Mumbai Income Tax Appellate Tribunal (ITAT) instructed the Assessing Officer (AO) to delete the addition of Rs. 22,43,401 made on marketing expenses, because of 2 out of 17 parties failed to respond to the notice sent under section 133(6) of the Income Tax Act.
The well-known hotel chains India M/s EHL Ltd and The Lalit Golf & Spa Resort are the 2 parties who failed to respond to the notice.
The bench of Prashant Maharishi (Accountant Member) and Sandeep Singh Karhail (Judicial Member) observed that it is no doubt true that payment through the bank channel is not conclusive proof of the transaction.
The bench of Prashant Maharishi (Accountant Member) and Sandeep Singh Karhail (Judicial Member) observed that it is no doubt true that payment through the bank channel is not conclusive proof of the transaction.
In Ducere Technologies Private Limited vs Deputy Commissioner of Income Tax,The Income Tax Appellate Tribunal ( ITAT ), Hyderabad bench has deleted an addition by the National Faceless Assessment Centre ( NFAC ) by holding that the “Company” cannot have salary income under the provisions of the Income Tax Act, 1961.
Shri K. Narasimha Chary, Judicial Member observed that “It is therefore clear that the assessee is not disputing the additions made but only prays for verification of the brought forward losses for the purpose of setting-off the additions now made against such losses. Since the assessee is a company as is established by the 143(1) intimation, the question of assessing its income under the head ‘salary’ does not arise. Impugned order is, therefore, liable to be set aside. The aspect of availability of brought forward losses needs verification at the end of the 2019-20 resulting in raising demand to Rs. 2,55,650/-.”
In Purushothama Reddy Vankireddy vs ADIT, The Hyderabad bench of the Income Tax Appellate Tribunal (ITAT) has held that Rule 128(9) of the Income Tax Rules regarding the disallowance of foreign tax credit (FTC) in cases where filing Form 67 is delayed is in contradiction with the double taxation avoidance agreement (DTAA) between India and USA and shall be read down.
A bench of Shri Rama Kanta Panda, Accountant Member & Shri K.Narasimha Chary, Judicial Member observed that the Apex Court including the case in Union of India Vs. Azadi BachaoAndolan, reached a conclusion that since Rule 128(9) of the Rules does not provide for disallowance of FTC in the case of delay in filing Form 67 and such filing within the time allowed for filing the return of income under section 139(1) of the Act is only directory, since DTAA overrides the Act, and the Rules cannot be contrary to the Act.
Relying on the above decision, the ITAT held that “We find from Article 25(2)(a) of the DTAA that where a resident of India derives income which, in accordance with the provisions of the convention, may be taxed in the United States, India shall allow as a deduction from the tax on the income of the resident an amount equal to the income tax paid, paid in the United States, whether directly or by deduction.
In M/s. Toyota Kirloskar Motor (P) Ltd. vs ACIT LTU Circle-1 The Income Tax Appellate Tribunal (ITAT), Bangalore Bench comprising Beena Pillai, Judicial Member and Laxmi Prasad Sahu, Accountant Member, in a major setback to M/s. Toyota Kirloskar Motor (P) Ltd, rejected the depreciation claim on a provisional basis.
The Bench observed that “Accordingly, we uphold the order of the lower authorities. The assessee admitted that there was excess claim of depreciation on the provisions created, which has been reversed subsequently. Considering the totality of the facts and circumstances of the case, we uphold the order of the revenue authorities.
In Deputy Commissioner of Income Tax vs M/s. S.G.P. Exim Pvt Ltd,The Chennai bench of the Income Tax Appellate Tribunal (ITAT) deleted the addition under section 50C of the Income Tax Act,1961 as the difference between the Sale Consideration and Stamp Duty Valuation is Less thaThe revenue challenged the order passed
by the Commissioner of Income Tax (Appeals) which deletes the disallowance of interest expenses of Rs.6,29,504/- which was decided in favour of the assessee.
It was observed that as per the 3rd proviso to section 50C(1) of the Act, inserted by the Financial Act, 2018 w.e.f. 01.04.2019, if difference the between stated consideration and guideline value does not exceed 10% of the consideration received or accruing as a result of the transfer, the consideration so received or accruing as a result of the transfer shall be deemed to be the full value of consideration.
In Michael Page International Pte Limited vs Deputy Commissioner of Income-tax,The Mumbai bench of Income Tax Appellate Tribunal ( ITAT ) deleted the addition made by the Assessing Officer (AO) stating addition made on account of fee for technical services is unsustainable.
The assessee Michael Page International Pvt Limited filed the appeal against the assessment order passed under section 143(3) read with section 144C(13) of the Income Tax Act, 1961 for the A.Y. 2018-19.
The bench observed that the AO held that the fees paid by Indian entities to the assessee is covered under “fees for included services” as the “make available” clause is duly satisfied.
In Karnataka Vikas Grameena Bank vs Asst. Commissioner of Income Tax,The Bangalore Bench of the Income Tax Appellate Tribunal (ITAT), granted relief to Karnataka Vikas Grameena Bank and allowed deduction on income from cooperative society.
The assessee is Karnataka Vikas Grameena Bank and the Counsel for the assessee also argued on the legal issue in regard to eligibility of claiming deduction under Section 80P of the Income Tax Act by holding that the assessee is not cooperative bank and it is a cooperative society, therefore, the Section 80P(iv) will not affect the eligibility for claiming deduction under Section 80P(2a)(i) of the Income Tax Act on the profits earned
A Coram comprising George George K, Judicial Member and Laxmi Prasad Sahu, Accountant Member observed that “The assessee is a regional rural bank and formed with the merging of four regional banks into a single regional rural bank. As per the Regional Rural Bank Act 1976 notification dated 12/09/2005, the shareholders were the Central Government, State Government and sponsored Bank.”
In Turbo Energy Private Limited vs Deputy Commissioner of Income Tax Counsel for Appellant: Shri. R. Vijayaraghavan,The Income Tax Appellate Tribunal (ITAT) Chennai bench held that Tax Deduction at Source not applicable to payment made to Non-Residents.
Assessee Turbo Energy Private Limited company is a manufacturer of turbochargers and components for engine application in passenger cars, commercial vehicles, off highway vehicles and industrial engines. After filing the income tax return Assessing officer disallowed additions under section 40(a) (i) of the Income Tax Act 1961 towards logistic service a payment for non-deduction of TDS under section 195 of the Act. Against the order
assesse filed appeal before CIT (A).CIT (A) deleted the addition made towards disallowance u/s. 40(a)(i) of the Income Tax Act 1961 for non-deduction of TDS on payment made to non-resident.Aggrieved revenue appeal before ITAT
The ITAT bench comprising G. Manjunatha, Vice President and V. Durga Rao, Judicial Member deleted additions made towards disallowance of payment made to non-resident service providers.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has held that the mere entry in the books of account could not be a ground to delete the addition when the sources were not explained.
The Delhi Bench of B R R Kumar (Accountant Member) and Yogesh Kumar US (Judicial Member) held that the mere reflection of the unexplained cash in the books of accounts in the absence of any supportive documents, could not be a ground for deletion of the addition. The bench set aside the deletion of addition by the Commissioner of Income Tax (Appeals)(CIT(A)) and allowed the appeal.
In Warner Bros. Distributing Inc C/Of the Act Warner Bros. Pictures India Pvt. Ltd.vs Assistant Commissioner of Income Tax,The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has deleted the addition as Warner Bros had no permanent establishment in India.
The Mumbai Bench of Vikas Avasthy (Judicial Member) and Gagan Goyal (Accountant Member) observed that the Indian company who had obtained the rights were acting independently and also held that the assessee could not be said to have any permanent establishment in India . The bench allowed the appeal and deleted the addition.
In M/s Sagitarius Securities Pvt Ltd vs The I.T.O Ward -22(3), Delhi Bench of Income Tax Appellate Tribunal (ITAT) upheld the rejection of valuation report submitted by the assessee on the grounds that it violated the rule 11UA of Income Tax Rules.
The appeal was preferred against the decision of the Commissioner of Income Tax (Appeals) [CIT(A)] on upholding the addition made by the Assessing Officer (AO) amounting to Rs. 1,49,60,000 under section 56(2) (viib) of the Income Tax Act, 1961.
The bench of Kul Bharat (Judicial Member) and N.k.Billaiya (Accountant Member) found that there is no fault with the AO that the assessee violated the Rule 11UA and shall be entitled to the addition made.
In Dy. Commissioner of Income Tax vs Ashrita Construction Pvt. Ltd, The Ahmedabad Bench of Income Tax Appellate Tribunal ( ITAT )has held that the income from sale of unsold flats by the builders should be taxable under the head of income from business.
Section 22 of Income Tax Act, 1961 says that the annual value of property consisting of building or land apparent other than property conducting business or profession to which assessee is the owner shall be calculated under the head of income from house property and section 23 deals with the determination of the annual value of the property.
The Income Tax Appellate Bench of Suchitra Kamble (Judicial Member) and Waseem Ahmed (Accountant Member) dismissed the appeal upholding the deletion of addition by the CIT(A) observing that the assessee was a developer and held the unit in questions income from such unit could be taxed only under business income and not under income from house property.
In Shri H K Suresh vs The Principal Commissioner of Income Tax (Central), According to the Income Tax Appellate Tribunal (ITAT) Bangalore bench of George George K. (a judicial member) and Padmavathy S. (an accountant member),a revision order is invalid ,Without a Director Identification Number (DIN).
The appeal was against the order under section 263 of the Income Tax Act, 1961 passed by the Principal Commissioner of Income Tax (PCIT).
The assessee, an individual is a contractor earning business income from contract receipts apart from rental income and interest income and filed return of income Rs. 2,58,15,614 for the A.Y. 2011-12.
The authority noted that it is obvious that neither the section 263 of the Income Tax Act order nor the specific format specified in Paragraph 3 states that the communication is issued manually without a DIN after receiving the required approvals. As a result, they conclude that the challenged order does not conform with paragraphs 2 and 3 of the Central Board of Direct Taxes (CBDT) circular.
In Longia Engineers vs Pr. CIT,the Chandigarh Bench of Income Tax Appellate tribunal ( ITAT )has held that the issue not subjected to limited scrutiny could not be raised in revisionary proceedings
The Chandigarh Bench of Income Tax Appellate Tribunal (ITAT)of Vikram Sing Yadav AM observed that the matters related to wages/labor expenses which were not subjected to the of limited scrutiny could not be raised in revisionary proceedings u/s 263 of the Income Tax Act 1961 for the first time. The bench also observed that the order passed by the AO could not be treated as erroneous and prejudicial to the interest of the Revenue. The bench thereby upheld the decision of the AO and set aside the revision order.
In ACIT vs TCIL Bina Toll Road Ltd , The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) found that incorrectly entering a Tax Deduction Account Number (TAN) in a Tax Deduction Source (TDS) deposit Challan will not result in a demand under section 200A of the Income Tax Act, 1961.
The appeal was filed by the revenue against the order passed by the CIT(A) arised from the order of Assessing Officer (AO) under Section 200A(1) of the Income Tax Act, 1961 for the A.Y. 2014-15.
The assessee, TCIL Bina Toll Road Ltd, a subsidiary of Telecommunication Consultants India Ltd. (TCIL), a Government of India Undertaking under the administrative control of the Ministry of Communication.
The bench of Saktijit Dey (Judicial Member) and Pradeep Kumar Kedia (Accountant Member) observed that the order of the CIT(A) in granting relief to the assessee is founded on fair play and natural justice.
In Rohan Hattangadi vs CIT,Mumbai Bench of Income Tax Appellate Tribunal (ITAT) ruled that delay in filing the Form 67 was not a reason to deny the claim of the Foreign Tax Credit (FTC) under Double Taxation Avoidance Agreements (DTAA). The appeal was filed by the assessee, Rohan Hattamgdi, challenging the order of the Commissioner of Income Tax (Appeals) [CIT(A)], National Faceless Appeal Centre (‘NFAC’) passed under section 250 of the Income Tax Act, 1961.
The Tribunal of M. Balaganesh (Accountant Member) and Kavitha Rajagopal (Judicial Member) has held that delay in filing Form No. 67 should not deny the claim of FTC enumerated in the DTAA and the intention of the legislation in the said case has to be construed in a manner which benefits the assessee.
In Dy. Commissioner of Income Tax Central Circle 1(3) vs M/s NIBR Bullion Pvt. Ltd,
The Income Tax Appellate Tribunal (ITAT), Mumbai Bench, has recently in an appeal filed before it, held that the addition against a company based on the statement of the director during the search, cannot be confirmed without supporting evidence.
The aforesaid observation was made by the Mumbai ITAT when an appeal was preferred before it by the Revenue, as against the order of Commissioner of Income Tax Appeals, Mumbai [CIT(A)], dated 30/05/2011, for the assessment year 2009-10.
Thus dismissing the Revenue’s appeal, the ITAT held: “In the light of the facts of the case, various decisions and CBDT instructions, we see no infirmity in the impugned order granting partial relief to the assessee. Hence, the impugned order is upheld and appeal of the Revenue is dismissed.”
In Ramdas Pandharinath Kale vs Income Tax Officer,The Income Tax Appellate Tribunal, Pune Bench, has recently, in an appeal filed before it, held that the beneficial provision of section 54 B of the Income Tax Act shall be interpreted liberally.
The aforesaid observation was made by the Pune ITAT when an appeal was preferred before it by the assessee, an HUF named Ramdas Pandharinath Kale, as against the order dated 17-12-2018, passed by the Commissioner of Income Tax (Appeals), Pune [CIT(A)], for the assessment year 2013-14.
Thus, allowing the assessee’s appeal the Pune ITAT held: “Following the order of Surat Bench of Tribunal in the case of Babubhai Arjanbhai Kanani (HUF), I hold that the assessee is entitled to claim deduction u/s. 54B of the Income Tax Act and that the enhancement made by the CIT(A) is not justified. Thus, the order of AO is restored in allowing deduction u/s. 54B of the Income Tax Act to an extent of Rs.80,85,572/”.
In M/s. Miracle Cars India Pvt Ltd. vs Deputy Commissioner of Income Tax,The Income Tax Appellate Tribunal (ITAT), Chennai, has recently, in an appeal filed before it, held that advertisement expenses are not allowable without a valid agreement for the transfer of the dealership.
The aforesaid observation was made by the Chennai ITAT when an appeal was preferred before it by the assessee, M/s. Miracle Cars India Pvt Ltd., as against the order passed by the learned Commissioner of Income Tax (Appeals), Chennai, dated 03.01.2022, pertaining to the assessment year 2012-13.
THe ITAT Bench consists of V. Durga Rao, the Judicial Member, and G. Manjulatha, the Accountant Member observed : “We have heard both the parties, perused materials available on record and gone through orders of the authorities below. The Ld. Counsel for the assessee rested his arguments on the basis of agreement between the appellant and M/s. DRS Industries Ltd., and argued that the assessee has incurred advertisement expenses, because it was supposed to takeover dealership business from M/s. DRS Industries Ltd.”
In M/s. AstraZeneca Pharma India Ltd vs DCIT,The Bengaluru Bench of the Income Tax Appellate Tribunal (ITAT), restored matters on disallowance of contribution towards gratuity funds, thereby granting relief to M/s. AstraZeneca Pharma India Ltd, the assessee.
The assessee incurred Rs.4 crores towards contribution to the gratuity fund and paid to the said fund before the due date for filing return of income. The same was also disclosed in the tax audit report. It was therefore submitted that the entire amount is eligible for deduction u/s. 36(1)(va) of the Income Tax Act.
The Bench comprising Beena Pillai, Judicial Member and Padmavathy S, Accountant Member noted that “The AO has made disallowance considering the provisions of Section 144C(8) of the Act and sustained the disallowance. Since the AO has not verified the details of gratuity based on the details furnished by the assessee, we remit the issue back to the AO with a direction to examine the details of payment of gratuity and decide the allowability accordingly.”
In Allsec Technologies Ltd. Vs DCIT,The Income Tax Appellate Tribunal (ITAT) of Chennai Bench ruled that the disallowance imposed under Section 40(a)(i) of the Income Tax Act, 1961, prohibiting Tax Deduction Source (TDS) on payments to Non-Residents, cannot be applied retroactively.
The tribunal referred to the case of M/s. TVS Electronics Ltd. v. ACIT, wherein, the Tribunal under identical facts held that the assessee cannot be fastened liability on the basis of subsequent amendment to the law with retrospective effect, because the assessee cannot be expected to do impossibility of performance and thus, for non-deduction of TDS under section 195 of IT Act, payment made to non-residents, cannot be disallowed under section 40(a)(i) of IT Act. The bench of Mahavir Singh (Vice President) and Manoj Kumar Aggarwal (Accountant member) dismissed the appeal filed by the respondent and stated that the disallowance made under section 40(a)(i) of Income Tax Act would be unwarranted.
In HV Global Pvt. Ltd vs ITO,The Delhi Bench of Income Tax Appellate Tribunal (ITAT)has held that the payment of rent and maintenance charges to different entities under a single agreement could not be treated as Tax Deduction at Source (TDS) default.
Section 201 (1) of the Income Tax Act 1961 deals with the consequence of non-payment of TDS, that is if any person failed to deduct TDS or failed to pay to the government then such person shall be deemed to be assessee default and he shall be liable to pay penalty unless AO is not satisfied with the reasonableness or sufficient ground for such failure. Section 201(1A) says that such person under (1) shall be liable to pay a simple interest on the amount failed to pay or deduct.
The Delhi Bench of CM Garage (Judicial Member) and Pradip Kumar Kedia (Accountant Member) observed that the assessee couldn’t be made liable under the provisions of subsections (1) and (1A) of section 201 of the Income Tax Act 1961 as the payments of rent and common area maintenance charges had been made to distinct entities/companies.
In Kacharu Madhukar Shinde vs The Joint Commissioner of Income Tax,The Pune Bench of Income Tax Appellate Tribunal (ITAT) has upheld the penalty imposed under Section 271E as the repayment of loan in cash had exceeded Rs. 20,000.
The Pune Bench of Dipak P Rippotte (Accountant Member) and S S Godara (Judicial Member) held that the assessee was liable for penalty u/s 271E and uphold the penalty u/s 271E as the assessee had repaid loan in cash in excess of Rs.20,000/- and also had not submitted any sufficient cause for such payment. The bench dismissed the appeal of the assessee.
In VIC Enterprises Pvt. Ltd vs ACIT ,The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has held that the scholarship to students not associated with the company for any commercial or business purpose would not be allowed as deduction.
The Delhi Bench of B R R Kumar (Accountant Member) and Yogesh Kumar US (Judicial Member) observed that the incumbent student was neither an employee nor associated with the company for any commercial or business purpose. The bench also observed that the expediency of sponsoring the student had not been brought on record nor the student had contributed in any manner for augmenting, contributing to the business of the assessee.
In ACIT vs M/s Shoppers Stop Limited,Income Tax Appellate Tribunal (ITAT) Mumbai Bench ruled that Sales or Return (SOS) agreements did not fall within the ambit of Section 194C of the Income Tax Act, 1961 and therefore the assessee did not have any liability to deduct tax at source on such payments under section 194C of Income Tax Act.
The AO noted that the term outlets model was ’Sales or Return‘ being used by the assessee for their business misleading and was an attempt to evade the rigours of Section 194C of the Income Tax Act. According to the AO, these facts indicated that the contract between the assessee and vendors were ‘contracts of work &labour’ not ‘contracts of supply’. The bench of Amarjit Singh (Accountant Member) and Aby T. Varkey (Judicial Member) uphold the decision of CIT(A).
In Shri Narendra Shantikumar Firodia vs Dy. Commissioner of Income Tax,The Income Tax appellate tribunal (ITAT) in a case recently held that Section 50C (1) of the Income Tax Act 1961 cannot be invoked in case of transfer of leasehold rights.
As per section 50C (1) of the Income Tax Act 1961 refer that an assessee received any consideration by way of transfer of asset it may be land, or building, or both in such a case the value of the asset is less than that assessed by the authority of state government for the purpose of payment of stamp duty, the assessed value is
consider as the full value of the consideration in case of result of the above transfer.
The Division bench of ITAT Pune comprising G. D. Padmahshali, Accountant Member, and SS Viswanethra Ravi, Judicial Member, allowed the appeal and held that the transaction of transfer of leasehold right in question did not warrant invoking of section 50C(1) of the Income Tax Act 1961.
InPrasanta Kumar Mishra vs ACIT,Income Tax Appellate Tribunal (ITAT) recently allowed non -resident Indian (NRI) vto rectify Income Tax Return after seven years as tax benefit was not claimed by mistake.
the ITAT bench allowed the appeal filed by the assessee and held that the “Assessing Officer is at liberty to examine whether the assessee was NRI during the relevant point of time and whether he is entitled to the benefit of exemption under section 5 (1) (c) read with section 6 of the Income Tax Act 1961”.
In Rohit Infra Projects Pvt.Ltd vs DCIT, Central Circle-2 B, The Mumbai Bench of Income Tax Appellate Tribunal (ITAT)has held that the Assessing Officer should consider a valid revised return while completing the assessment.
The Bench of Gagan Goyal (Accountant Member) and Aby T Varkey (Judicial Member) held that the Assessing Officer had erred in not considering the revised return filed by the assessing officer. The bench allowed the petition and seaside the impugned order directing the Assessing officer to make fresh assessment considering the revised return.
In Oxford University Press vs DCIT, Income Tax Appellate Tribunal (ITAT), Mumbai Bench recently held that payment by Oxford University press towards school support services for referring students constitutes brokerage.
the ITAT bench comprising M. Balaganesh (Accountant Member) and Kavitha Rajagopal (Judicial Member) and conclude that the assessee is bound to deduct tax at source, failure of which would be invited with disallowance under section 40(a) (ia) of the Income Tax 1961.
Section 194H of the Income Tax Act 1961 deals that Tax Deduction at Source should be levied on the earnings received as commission or brokerage. Section 40(a) (ia) of the Income Tax 1961 expenditure mentioned under the heads of TDS, such amount paid and deducted profit and loss account of resident would not be allowed as deduction while computing the income under the heads of Profit and Loss account.
IN Sh. Vijay Sharma vs ACIT, Circle-II,The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has recently held that capital gain exemption under Section 54 is not allowable in cases where the builder has not started construction of house.
It was also contended that the Commissioner of Income Tax (Appeals) [CIT(A)] has wrongly concluded that it is a case where the developer was not having necessary approval from the government to construct residential units and that it is not a case that the assessee was not offered possession.
The approval of the zonal plan and delivery of possession happened by 18.08.2022 whereas the land was purchased on 17.12.2014. Section 54 of the Income Tax Act allows for an exemption on long-term capital gains tax for individuals and HUF (Hindu Undivided Family) if the proceeds from the sale of a long-term capital asset, such as a residential property, are invested in the purchase or construction of another residential property within a specified time frame.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) chaired by Saktijit Dey (Judicial Member) deleted the addition sustained by the Commissioner of Income Tax(Appeals) [CIT(A)].
On examining the additional evidence, the AO reported that out of the claim of income from sale of agricultural produce amounting to Rs. 24,00,000, an amount of Rs.10,36,305 appears to be genuine. Accordingly, out of the addition of Rs.31,00,000 made by the AO, CIT(A) deleted an amount of Rs.10,36,305 and confirmed the balance amount.
The Delhi bench of the Income Tax Appellate Tribunal (ITAT) has held that the centralized services fee received by Starwood Asia Pacific is not taxable as royalty under India-Singapore Treaty.
A Coram comprising of Shri G S Pannu, President and Shri Saktijit Dey, Judicial Member viewed that the Coordinate bench in an identical issue held that “the centralized service fee received by the assessee cannot be treated as FIS under Article 12(4)(b) due to failure of ‘make available’ condition, has made an unsuccessful attempt to bring it within the ambit of Article 12(4)(a) of the Treaty and in the processes has misrepresented certain facts.”
The Delhi bench of the Income Tax Appellate Tribunal ( ITAT ) has held that the consultancy charges paid by Kuiper Compagnons to overseas entities are taxable as Fee for Technical Service (FTS).
A Coram comprising Shri G S Pannu, President and Shri Saktijit Dey, Judicial Member observed the assessee was unable to furnish any cogent explanation supported by evidence to establish that the consultancy charges paid are not like FTS.
The Delhi bench of the Income Tax Appellate Tribunal (ITAT) has held that gifts to dealers and “Shagun” during the marriage of dealers and staff are effective tools for business promotion and social welfare and are a deductible expense.
A Coram Comprising Dr B. R. R. Kumar, Accountant Member and Sh. Yogesh Kumar US, Judicial Member observed that “the issue has been decided in favor of the assessee for the AY 2006-07, 2007-08, 2008-09, 2009-10, 2010-11, 201112, 2012-13, 2013-14, 2014-15 and 2015-16 by the CIT (Appeal), Rohtak which was upheld by the Coordinate Bench of ITAT.
In a recent judgment, the Delhi bench of the Income Tax Appellate Tribunal ( ITAT ) has held that the distribution revenue received by Cable News Network (CNN) is not “Royalty
A Coram comprising of Shri G S Pannu, President and Shri Saktijit Dey, Judicial Member observed that in the assessment year 2003-04, the competent authorities of India and USA reached an agreement under Mutual Agreement Procedure (MAP) holding that 10% of the advertising and subscription revenue received from India shall be deemed to be the net profit chargeable to tax in India.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) clarified the taxability of the sum received from ICC events in India and held that 25% of the Licence Fee paid by SET Satellite (Singapore) Pte Ltd (SET) to Global Cricket Corporation Pvt Ltd (GCC) is a fair estimate.
The Tribunal observed that the Heads Agreement does not provide any break-up of the consideration and noted that the CIT(A) had, while deciding the appeal for the Assessment Year 2003-04, attributed 75% of the consideration for use of copyright in the live feed and balance 25% for use of copyright in non-live feed/transmission such as highlights, telecast of recorded matches etc.
In a significant ruling, the Delhi bench of the Income Tax Appellate Tribunal (ITAT) has held that the Race Promotion Contract (RPC) fee is an additional income by Formula One and is taxable.
A Coram comprising of Shri G S Pannu, President and Shri Saktijit Dey, Judicial Member observed that the TDS credit partakes the character of original income, i.e., the RPC fee and has to be taxed in the same manner in which the Assessing Officer taxed the RPC fee.
Delhi Bench of Income Tax Appellate Tribunal (ITAT) allowed the capital gain exemption under section 54B of Income Tax Act, 1961. The tribunal stated that such deduction shall not be denied merely stating that the agricultural land was purchased in the name of the wife of the taxpayer.
The single appeal bench of Saktijit Dey (Judicial Member) drew on various High Court rulings in reaching its conclusion that investments in real estate bought in the wife’s name are eligible for a deduction under Section 54B of the Income Tax Act.
Addition made under section 69A of the Income Tax Act, 1961 was deleted by the Delhi Bench of Income Tax Appellate Tribunal (ITAT) as the cash deposit was kept for the medical emergency.
The single bench of Saktijit Dey (Judicial Member) observed that the department does not have any contradictions on the illness of the assessee and also it’s a serious matter that should be considered. Furthermore, considering the fact that the assessee face a serious medical condition, her explanation that cash withdrawals made earlier were kept at hand for meeting any medical emergency, to some extent, is believable and thus directed to delete the addition.
The Income Tax Appellate Tribunal (ITAT), Chennai Bench, has recently, in an appeal filed before it, held that sale proceeds of agricultural land is not taxable as capital gain.
Thus finally allowing the assessee’s appeal in part, the Chennai ITAT concluded : “At this stage, when pointed out to ld.counsel, whether he want to file the details before AO to prove the creditor, he undertook to file complete details and to produce whatever evidence the AO wants in regard to this. On this, the ld.CIT-DR has not objected. Hence, in view of the concession given by both the sides, we remit this issue back to the file of the AO, who will examine the creditor and then will decide accordingly.”
The Income Tax Appellate Tribunal (ITAT), Surat Bench, has recently, in an appeal filed before it, held that there can be no deemed registration, if the income tax department is not deciding registration application u/s 12AA, within a period of six months.
“The case law relied on ld. CIT-DR for the revenue in Harshit Foundation Vs CIT ,wherein the Hon’ble Supreme Court has held that there is no specific provision in the Income Tax Act that by non-deciding the registration application under Section 12AA within a period of six months there shall be a deemed registration. Thus, the ratio of this decision is directly applicable on the facts of the present case.”
The Income Tax Appellate Tribunal (ITAT), Delhi Bench, has recently, in an appeal filed before it, held that the levy of surcharge and cess cannot exceed the tax rate of 10%, as per India – Japan DTAA.
“Having considered the rival submissions, in principle, we accept the assessee’s contention that levy of surcharge and cess cannot exceed the tax rate of 10% as per India – Japan DTAA. Article 12 of India – Japan tax treaty provides that the tax to be charged on royalty and FTS shall not exceed 10% of the gross amount of royalty or FTS. Article 2 of the tax treaty defines tax in India as income tax including any surcharge thereon. Therefore, Article 12 read with Article 2 of the tax treaty makes it clear that the rate of tax at 10% would encompass surcharge and education cess as it is also in the nature of surcharge.”, the ITAT Bench further added.
The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT) observed that re-assessment based on information from the Investigation Wing of Income Tax Department is valid.
The Tribunal of Aby T Varkey, Judicial Member observed that “I hold that the appeal of the Revenue is not maintainable because the source of information on which AO re-opened the assessment was emanating from the investigation wing of the Income Tax Department and not from the external law enforcement agencies to fall in the exception to agitate before this Tribunal despite hit by low tax effect.”
The Income Tax Appellate Tribunal ( ITAT ), Mumbai Bench held that Premium Expenses on Foreign Currency Convertible Bonds ( FCCB ) is Revenue Expenditure and hence is deductible.
The Coram consisting of Om Prakash Kant, Accountant Member and Rahul Chaudhary, Judicial Member observed that “We find that identical issue of expenses of premium on FCCB are in the nature of liability whether ascertained and revenue expenditure, has been decided by the Coordinate Bench of the Tribunal in the case of Strides ShasunLimited v. ACIT.”
The Income Tax Appellate Tribunal (ITAT), Mumbai Bench, has recently, in an appeal filed before it, held that bringing evidence on what basis income has escaped and re-opening of assessment is required, is a procedural requirement to invoke section 147/148.
The Mumbai ITAT concluded: “The assessment itself becomes bad in law and therefore does not survive. The appeal of the assessee is allowed on the legal issue and therefore there is no need to comment on the merit of the case”.
The Income Tax Appellate Tribunal (ITAT), Mumbai Bench, has recently, in an appeal filed before it, held that section 263 is not a mechanism available for PCIT for taking Second Opinion.
The Mumbai ITAT ruled : “ In this particular case, the Pr. CIT has given the different opinion and different treatment to the share investment made by the assessee which amounts to second opinion. This is not permissible u/s 263 as the assessment order does not amount to erroneous and prejudicial to the interest of the Revenue. Hence, the order u/s 263 does not sustain and the appeal of the assessee is allowed.”
The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has held that the assessment order passed against the dead person would be invalid.
The Divisional Bench of Prashant Maharishi (Accountant Member) and Pavan Kumar Gadale, (Judicial Member) allowed the appeal quashing the impugned order and observed that “In the assessment order itself, the learned Assessing Officer has mentioned that he has come to know through e-portal that the assessee have expired in the month of January, 2019. The 263 order is invalid as the same is passed in the name of the deceased person. It was also stated that an assessment order is also passed in the name of the dead person.”
The Mumbai bench of Income Tax appellate tribunal (ITAT) recently held that addition under section 153C of Income Tax Act 1961 could not be made based on documents found during the survey.
The Division bench of ITAT comprising Prashant Maharishi (Accountant) Member, and Pavan Kumar Gadale(Judicial Member), allowed the appeal filed by the assessee and observed that search under Section 132(1)Income Tax Act 1961 as well as survey under Section 133A of the Income-tax Act, 1961 was carried out at various premises of Ameya Group,and also There is no order required to be passed under Section 133A of the Act if the documents are found and seized during the course of search .
The Mumbai Bench of Income Tax Appellate Tribunal ( ITAT ) has held that Non-resident’s income or deposit in foreign bank accounts could not be taxed in India.
The Bench of S. Rifaur Rahman (Accountant Member) and Amit Shukla (Judicial Member) allowed the appeal, held that the assessee could not be treated as resident and income or deposit in the foreign bank account of the assessee who is not resident in India could not be taxed in India. The Bench observed that, merely mentioning the status as resident in the original return of income does not make the assessee as resident in India. Here in this case, assessment has been made u/s 153A and the assessee has declared the status as non-resident in return of income filed in response to the notice u/s 153A and the assessment has been completed in the status of non-resident.”
The Ahmedabad bench of the Income Tax Appellate Tribunal ( ITAT ) observed that profit from the sale of Carbon Credit is “Capital Receipt” and held as not taxable.
The Tribunal held that the profit earned by the assessee for Carbon Credits is capital in nature; and, the addition made by the Revenue by treating them as revenue in nature is directed to be deleted.
The Delhi bench of the Income Tax Appellate Tribunal (ITAT) observed that “ a right tax has to be collected from the right person” and held that the Centralised Processing Centre (CPC) is bound to correct wrong adjustments made through an automated process.
A Coram composed of Dr B. R. R. Kumar, Accountant Member and Sh. Yogesh Kumar US, Judicial Member held that “a right tax has to be collected from the right person and though the CPC has processed the return based on the information given by the assessee, and when the information given by the assessee itself is incorrect in filling of the relevant column, the same needs to be allowed to be rectified in the interest of justice.”
The Income Tax Appellate Tribunal (ITAT), Rajkot Bench, has recently, in an appeal filed before it, held that road construction expenses incurred to provide easy and smooth access from highway to factory are allowable as business expenditure.
The Rajkot ITAT ruled : “Based on the above, it seems to us that the assessee is not enjoying any benefit of enduring nature out of the expenditures discussed above. Hence, we set aside the finding of the learned CIT (A) and direct the AO to delete the addition made by him.”
The Bangalore Bench of Income Tax Appellate Tribunal (ITAT) has allowed Tax Holiday relief under Section 10A to IBM India.
Chandra Poojari (Accountant Member) and Beena Pillai (Judicial Member) allowed the appeal observing that the assessee had produced a letter of RBI dated 28/02/2014, the Competent Authority, mentioned u/s. 10B (3) of the Act and it clarifies that the assessee was granted post facto extension. The assessee company had also subsequently realized the said amount. The Bench observed that “The assessee has obtained post facto approval from RBI coupled with the fact that it has also realized the said amounts, it is entitled to the deduction u/s. 10A/10B of the Act on the said amounts.”
Bangalore bench of Income Tax Appellate Tribunal (ITAT) recently held that the income tax notice served on wife assessee is valid.
The ITAT bench comprising Chandra Poojari (Accountant Member) and Beena Pillai, (Judicial Member) dismiss the appeal filed by the assessee and conclude that penalty order has been properly passed within due date and has been properly served to the assessee.
The Mumbai Bench of Income Tax Appellate Tribunal ( ITAT ) has held that no Tax Deducted at Source (TDS) shall be deducted as payment to vendors for procuring goods including clothes and footwears were not treated as work contracts.
The Mumbai Bench of Aby T. Varkey (Judicial Member) and OM Prakash Kant (Accountant Member) dismissed the appeal filed by the revenue and observed that the term ‘work’ has been defined in an inclusive manner and only if the ‘work contract’ undertaken by the payee falls within the above definition of ‘work’, as specifically defined in the section itself, that the provisions of Section 194C would become applicable. We thus agree with the findings of the Ld. CIT(A) that these SOR arrangements were on principal-to-principal basis and therefore in the nature of contract for sale of goods and thus, such an arrangement cannot be categorized as ‘works contract’ as defined in Section 194C of the Act.”
The Income Tax Appellate Tribunal (ITAT) Pune Bench recently held that builders are eligible for income tax deduction under section 37 of income tax act 1961 in respect of compensation to flat buyers on cancellation of booking. Section 37 of the Income Tax Act 1961 provides that for the progress of a company or profession the person who spends any expenditure shall be considered for calculating income under the head of profits and gains of business or profession.
The ITAT bench comprising GD Padmashali (Accountant Member), and Satbeer Singh Godara, (Judicial Member), allowed the impugned sum of Rs.7, 51,068/- as an allowable business expenditure deduction under section. 37 of the Income Tax Act 1961 and held that “neither the Assessing Officer nor the CIT(A) reject genuineness of the impugned compensation amounts paid by the assessee wholly and exclusively for the purpose of its day-to-day business activity in line of development and building construction etc.”
The Income Tax Appellate Tribunal ( ITAT ) recently held that section 54 of the Income Tax Act 1961 are benevolent provisions therefore, requires liberal interpretation and the assessee is entitled to get the benefit of the benevolent provisions.
The division bench of the ITAT compraising Pradip Kumar Kedia, (Accountant Member) and Choudhry, (Judicial Member) allowed the appeal filed by the assessee and observed that “There is no doubt that the provisions of section 54F of the Act are benevolent provisions and therefore, requires liberal interpretation. In that sense, the assessee is entitled to get the benefit of the benevolent provisions”. Therefore just because the assessee could not deposit the consideration amount/capital gains in specified bank account that did not entail levy of penalty automatically.
The Income Tax Appellate Tribunal ( ITAT ), Chandigarh Bench, has recently, in an appeal filed before it, held that the income tax authorities should charge legitimate taxes from the assessee and that penalty cannot be imposed for bonafide mistakes.
The Chandigarh ITAT commented: “It has been time and again held that the Income Tax Authorities should charge legitimate taxes from the assessee.Theassessee should not be punished for his/ her bonafide mistake. The Instructions in this respect have also been issued by the CBDT from time to time that the Income Tax Authorities should assist the assessee in correctly making their claim in the return.”
The bench of Amit Shukla and Gagan Goyal of Mumbai Income Tax Appellate Tribunal ruled that Income from carriage of goods and for operating ships is taxable under section 44B of the Income Tax Act, 1961.
The bench observed that the assessee, since it is a non resident company engaged in the business of operation of ships, i.e., the ship of the assessee is used for transporting coal and has operated a ship on time charter basis by PSCL, therefore it has been subjected to tax under the special provision of section 44B of the Income Tax Act.
The Mumbai Bench of Income Tax Appellate Tribunal ( ITAT ) chaired by Aby T. Varkey (Judicial) and Amarjit Singh (Accountant Member) deleted the addition of Rs.278 crores made by the Assessing Officer (AO).
The bench upheld the decision of the Commissioner of Income Tax (Appeals) [CIT(A)] holding that the amount of compensation received was a capital receipt.
The Pune bench of the Income Tax Appellate Tribunal (ITAT) has held that a mere making claim which is not sustainable by law does not amount to furnishing inaccurate particulars of income and Penalty under section 271(1)(c) of the Income Tax Act, 1961 is not imposable.
A Coram comprising Shri Inturi Rama Rao, Accountant Member and Shri S SViswanethra Ravi, Judicial Member found that the addition u/s 36(1)(iii) was made by the Assessing Officer because the appellant had failed to demonstrate the advances to sister concern were made for the business purpose.
The Cuttack Bench of the Income Tax Appellate Tribunal (ITAT), observed that expenditure incurred towards Computer Software and Stationery are Revenue in nature.
The Bench comprising Arun Khodpia, Accountant Member and George Mathan, Judicial Member observed that “A perusal of the ledger account clearly shows that the expenditure incurred towards computer software and stationery which are nothing but revenue in nature. This being so, the findings of the CIT(A) are confirmed and the ground of the revenue stands dismissed.”
In Favour of RapipayFinvest, the Delhi bench of the Income Tax Appellate Tribunal (ITAT) ruled that the inability to generate income from software is not a ground to deny a depreciation claim.
A Coram comprising of Shri Anil Chaturvedi, AM and Shri N K Choudhry, JM observed that the holding company was duly authorized for sub-contracting to the Subsidiary company and the breach of terms and conditions of the contract between parties will not change the nature of revenue generated from the said transactions.
The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT), ruled that Advertising Marketing and Promotion (AMP) Expenditure is not an International Transaction and thereby ruled in favor of M/s Mattel Toys (India) Pvt. Ltd.
The Bench comprising Vikas Aswathy, Judicial Member and Om Prakash Kant, Accountant Member observed that “AMP expenditure is not an international transaction therefore, adjustment to said transaction for arm’s length price is rendered infructuous and no adjustment could have been made.”
The Delhi bench of the Income Tax Appellate Tribunal (ITAT) has held that receipt from management support services by Wolters Kluwer is not taxable as FTS under India-UK Treaty.
A Coram comprising Shri G S Pannu, President and Shri Saktijit Dey, Judicial Member held that the nature of services provided by the assessee does not give any impression that they are not like managerial services.
In a recent ruling, the Cuttack bench of the Income Tax Appellate Tribunal (ITAT) has held that the revisional order passed under 263 of the Income Tax Act, 1961 against a deceased assessee is not valid and quashed the order.
A Coram comprising of Shri George Mathan, Judicial Member and Arun Khodpia, Accountant Member observed that there was no provision under which the legal heir could have intimated the revenue regarding the death of the assessee as they had no certificate issued by the statutory authorities to prove the death. The legal heir certificate can be applied only after obtaining the death certificate.
The Pune Bench of Income Tax Appellate Tribunal (ITAT) has quashed the income tax proceeding as the non-compliance with communication under Section 143(1)(A) of Income Tax Act 1961 due to technical glitches in income tax portal was unintentional.
The Bench of S.S. Godara,(Judicial Member) and G. D. Padmahshali, (Accountant Member) observed that “ the appellant got its books audited, prior to filing of ITR for the impugned and the non-compliance with communication u/s 143(1)(a) of the Act due to IT Website technical glitches was unintentional and beyond the control of the appellant t is sufficient to form a reasonable cause for non-compliance and since the procedural compliance has been duly made good by fling the audit report on record, we see no reason to deny the exemption.”
Support our journalism by subscribing to Taxscanpremium. Follow us on Telegram for quick updates
