This yearly digest analyzes all the ITAT stories published in the year 2023 at taxscan.in
The Amritsar Bench of Income Tax Appellate Tribunal (ITAT) has held that the assessee should be given reasonable opportunity before making addition under Section 40A (7) of the Income Tax Act, 1961 before processing the rectification application.
The Two-member Bench of M.L.Meena (Accountant Member) and Anikesh Banerjee (Judicial Member) observed that the Section 154 of the Income Tax Act was not applicable in this case. But the assessee prayed that a reasonable opportunity was denied by the revenue authorities. The bench remitted back the issue to AO and directed for further adjudication.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has held that Tax Deducted at Source (TDS) would not be applicable on cost paid to holding companies on reimbursement of mobilisation and demobilisation. The two-member bench of G.S. Pannu (President) and Saktijit Dey (Judicial Member) allowed the appeal and deleted the disallowance made under Section 40(a)(i) of the Income Tax Act holding that there was no legal obligation under section 195(1) of the Income Tax Act on the assessee to deduct tax at source under Section 195(1) of the Income Tax Act on the reimbursement of mobilisation and demobilisation cost to the holding company (VOAMC).
The New Delhi Bench of the Income Tax Appellate Tribunal (ITAT) recently ruled that the Tax Residency Certificate (TRC) is sole evidence for Double Taxation Avoidance Agreement (DTAA) benefits and deleted Tax liability on Mauritius Company.
The Bench, consisting of Judicial Member Saktijit Dey and Accountant Member Dr. B. R. R. Kumar disagreed with the CITās observation and ruled that the Tax Residency Certificate is sole evidence for Double Taxation Avoidance Agreement (DTAA) benefits and deleted Tax liability on assessee. The Bench noted that the assessee had engaged in various transactions beyond bonds and cash, including investments in derivatives, concluding that the income earned was not taxable in India. In result, the appeal of the assessee was allowed.
The Ahmedabad Bench of Income Tax Appellate Tribunal (ITAT) has restricted the disallowance of expenses to 30% under Section 40(a)(ia) of the Income Tax Act 1961 as the assessee failed to provide details of the payee. The two-member Bench of Waseem Ahmed, (Accountant Member) and T.R. Senthil Kumar, (Judicial Member) observed that the assessee had failed to provide the details that the payee had included the amount received from the assessee in its income.
Thus, the assessee could not be given the benefit of the proviso to section 40(a)(ia) of the Income Tax Act. The Bench also noted that the Finance Act had made amendment to section 40(a)(ia) of the Income Tax Act with effect from 1-4-2015. The Various benches of the Tribunals had already held that the amendment made by Finance Act to be curative in nature, that disallowance under Section 40(a)(ia) of the Income Tax Act be restricted to 30% of the expenses paid as against 100% because amended provision was curative in nature and the provisions should be applied retrospectively. The Bench partly allowed the appeal by disallowing expenses on account of non-deduction of TDS restricted to 30% of the expenses.
The Amritsar Bench of Income Tax Appellate Tribunal (ITAT) has held that belated filing of Tax Deduction at Source return contemplated non levy of fee under Section 234E of the Income Tax Act was not an apparent mistake and could not be the subject matter under Section 154 of the Income Tax Act.
The two-member Bench of M. L. Meena, (Accountant Member) and SH Anikesh Banerjee, (Judicial Member) observed that, āTDS deduction in filing of TDS return and belated filing of TDS return contemplated into levying of fee u/s 234E of the Act is subject matter of verification of facts from record which is not covered under the provisions of section 154 of the Act where an apparent mistake of the record can only be rectifiedā. The Bench further restored the matter to examine the issue of the levy of fee under Section 234E of the Income Tax Act after verification of facts as per law.
The NewDelhi bench of the Income Tax Appellate Tribunal (ITAT) directed re-adjudication to the assessing officer for an addition made under section 69A of the Income Tax Act,1961 read with section 115BBE of the Income Tax Act due to non-filing of the return of income (ROI).
A single-member bench comprising Kul Bharat (Judicial) held that the impugned assessment order had been framed against the non-existent entity and directed the assessing officer to delete the addition made by him while allowing the appeal filed by the assessee.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that the amount received not in respect of the transfer of title, rights, or interests in property cannot be taxable under the head of ācapital gainsā.
The two-member bench comprising G.S. Pannu (President) and Sandeep Singh Karhail (Judicial) held that the amount received by the assessee was not in respect of the transfer of any right, title, or interest in the property and cannot be taxed under the head ācapital gainsā in the hands of the assessee while allowing the appeal filed by the assessee.
The Delhi bench of Income Tax Appellate Tribunal (ITAT) quashed the notice issued to dead person and held that section 292B of the Income Tax Act, 1961 should not be applicable if the assessee has not participated in the reassessment proceedings.
The two-member bench of Chandra Mohan Garg (Judicial Member) and Pradip Kumar Kedia (Accountant Member) held that āwhere notice seeking to reopen assessment was issued in name of deceased assessee, since she could not have participated in reassessment proceedings, provisions of section 292BB were not applicable to assesseeās case.ā Therefore, the bench allowed the appeal filed by the assessee.
The Delhi bench of Income Tax Appellate Tribunal (ITAT) has recently held capital gain exemption under Section 54F of the Income Tax Act, 1961 should not be disallowed if an amount for purchase of property and construction were duly paid within the relevant period.
The two member bench of the Dr. B. R. R. Kumar, (Accountant Member) and Yogesh Kumar US, (Judicial Member) allowed the appeal filed by the assessee and hold that the CIT(A) erred in disallowing the claim by making factually incorrect observations that the assessee had not deposited any amount in the capital gains scheme account whereas the amounts were duly deposited in the capital gains scheme account and duly utilized from the said account only.
The Kolkata bench of Income Tax Appellate Tribunal (ITAT) has recently held that claim of insurance on account of loss by fire could not be disallowed. The two member bench of Rajpal Yadav, (Vice President) and Girish Agrawal, (Accountant Member) allowed the appeal and observed that claim of the assessee of Rs.5,37,892/ by debiting in the Profit & Loss Account was a bona fide claim.
The Kolkata bench of Income Tax Appellate Tribunal (ITAT) has recently held that deduction should not be disallowed under Section 40(a)(ia) of Income Tax Act, 1961 on ground of Tax Deduction at Source (TDS) not deducted, if receipient include income from receipts of assessee.
The two member bench of Rajpal Yadav, (Vice-President) and Girish Agrawal, (Accountant Member) observed that recipients had shown these receipts as their income. Further Assessing Officer did not dispute about the nature of expenses and their incurrence for the purpose of their business, his only grievance was that the assessee has not deducted the TDS while making the payments.The bench considering the decision in the case of Hindustan Coca Cola āvs.- CIT, allowed the appeal filed by the assessee.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) directed re-adjudication for the disallowance of workersā provident fund (PF) contributions because they were made after the deadline in accordance with section 36(1)(VA) of the Income Tax Act of 1961.
The ITAT observed that according to the provisions of the General Clauses Act, it was appropriate to restore the issue to the file of the assessing officer for examining the payments made on the day next to the due date, being a holiday on the due date, and allow the deduction accordingly. The two-member bench comprising Om Prakash Kant(Accountant) and Narender Kumar Choudhry (Judicial) directed the matter for re-adjudication to allow the deduction while allowing the appeal filed by the assessee.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has deleted the disallowance under Section 14A of the Income Tax Act 1961 against oriental insurance company holding that head wise bifurcation was not required for the computing income of insurance company.
The two-member Bench of Anil Chaturvedi, (Accountant Member) and SH Anubhav Sharma, (Judicial Member) observed as Section 44 of the Income Tax Act had provided a complete code for computation of profit and gain of the business of the assessee insurance company. The assessing officer could not make any adjustments in the profit of the assesseeās business when they were calculated in accordance with the rules contained in first schedule.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has held that the cash seized could be adjusted against self-assessment tax payable under Section 132B of the Income Tax Act, 1961.
The two-member Bench of G.S. Pannu, (President) and Saktijit Dey, (Judicial Member) deleted the interest charged under Section 234B of the Income Tax Act observing that the cash seized could be adjusted against self-assessment tax payable with the return of income.
The Delhi bench of Income Tax Appellate Tribunal (ITAT) has recently held that additional income surrendered before the 2nd amendment to Section 115BBE of Income Tax Act, 1961 should be chargeable at ordinary rate of 30%. Therefore the bench quashed the revision order. It was observed by the tribunal that ,while the survey was conducted prior to substitution/ modification of Section 115BBE of the Income Tax Act, the assessment year concerned continues to be assessment year 2017-18. The ROI was filed after the substituted amendment had come into force.The two member bench of the Chandra Mohan Garg, (Judicial Member) and Pradip Kumar Kedia, (Accountant Member) allowed the appeal filed by the assessee.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) quashed the order passed by the assessing officer against a deceased person by issuing notice under section 148 of the Income Tax Act,1961 for reassessment.
The two-member bench comprising Aby T.Varkey(Judicial) and Om Prakash Kant (Accountant) held that impugned notice for reopening the assessment under section 148 of the Income Tax Act was issued in the name of the deceased assessee; and despite knowing that the assessee had passed away and proceeded to frame re-assessment, without first dropping the proceedings initiated by the issuance of the impugned notice.
The Amritsar bench of Income Tax Appellate Tribunal (ITAT) while quashing the revision order, held that cash deposit made in a savings bank account is sale consideration earned from the agricultural land.
The tribunal of M. L. Meena, (Accountant Member) and Anikesh Banerjee, (Judicial Member) observed that there is a direct nexus between the transaction of sale and the cash deposited in the bank account of the assessee as the transaction of sale of land is registered on 26.04.2010 and the cash was also deposited by the assessee on the same date. Thus the bench allowed the appeal filed by the assessee.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has directed a new adjudication holding that the support or maintenance services of Avaya international are taxable as Fees for Technical Services (FTS) under Article 12 of the India-Ireland Double Taxation Avoidance Agreement (DTAA).
The two-member Bench of G.S. Pannu (President) and Saktijit Dey (Judicial Member) following the decision in assesseeās own case restored back the issue to the Assessing Officer for de novo adjudication. Hence, the appeal allowed.
The Income Tax Appellate Tribunal (ITAT), Delhi Bench has held that the assessee cannot be treated as an āAssessee in Defaultā under Section 201(1) of the Income Tax Act, 1961 in the absence of Ascertainable Amount & Identifyable Payee. Consequently, TDS is not applicable and no interest could be levied under section 201(1A) of the Act, the bench held.
The two-member bench comprising of Shri Saktijit Dey (Judicial Member) and Shri M. Balaganesh (Accountant Member) held that the assessee could not be treated as an āassessee in defaultā under section 201(1) of the Income Tax Act, 1961 and no interest could be levied under section 201(1A) of the Act. The tribunal referred to the reversal of expenses made by the assessee in the succeeding year and the subsequent deduction of tax at source, which further supported the conclusion. As a result, the order of the CIT(A) was quashed and the appeal was allowed for statistical purposes only.
The Mumbai bench of Income Tax Appellate Tribunal (ITAT) has held that interest subsidy received under technology upgradation fund is capital receipt.hence no tax should be leviable.
It was observed by the tribunal that interest subsidy received under technology upgradation fund scheme, though credited in the net off against the interest expenditure in the books of account is still capital in nature and therefore not chargeable to tax. Therefore the two member bench of Prashant Maharishi, Accountant Member and Kuldip Singh, (Judicial Member) allowed the appeal of the assessee.
The Delhi bench of the Income Tax Appellate Tribunal (ITAT) has recently held that commission income earned from real estate business should not be attracted to Section 44AD of the Income Tax Act.
The tribunal determined that sources of the entire amounts, the credits and debits in the bank account have been duly explained Moreover, during the search, no incriminating evidence was discovered or seized to show that the credits of the assesseeās bank statements were in the nature of income or that he was engaged in any other line of work. Therefore the two-member bench of Dr. B. R. R. Kumar, (Accountant Member) and Yogesh Kumar US, (Judicial Member) dismissed the appeal filed by the revenue.
The Chennai bench of the Income Tax Appellate Tribunal (ITAT) has recently held that no penalty should be imposed under Section 271B of the Income Tax Act 1961 on the reason of the return not appearing in the e-filing portal.
The two-member bench of V. Durga Rao, (Judicial Member) and Manoj Kumar Aggarwal,(Accountant Member) relied upon the decision of the Ramunaicker Raja vs. ACIT allowed the appeal filed by the assessee and observed that penalty should not be levied by reason of return not appearing on the e filing portal.
The Mumbai bench of Income Tax Appellate Tribunal (ITAT) has recently dismissed an issue pertaining to applicability of tax rate provided under India-Mauritius (DTAA) to dividend declared by Ambuja Cement.
The two member bench of B.R. Baskaran (Accountant Member) and Sandeep Singh Karhail (Judicial Member) observed that the issue arising in Ground No.8 is covered in favour of the Revenue by the recent decision of the Special Bench of the Tribunal in DCIT v/s Total Oil India Private Ltd. Thus, the bench dismissed the ground no.8 raised in assesseeās appeal for the assessment year 2010- 11.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has deleted the penalty under Section 271(1)(c) of the Income Tax Act 1961 holding that mere acceptance of disallowance could not conclude furnishing of inaccurate particulars of income.
The two-member Bench of G.S. Pannu, (President) and Saktijit Dey, (Judicial Member) of ITAT deleted the penalty holding that merely because assessee had accepted the disallowance, it would not lead to the conclusion that the assessee had furnished inaccurate particulars of income.
The Income Tax Appellate Tribunal (ITAT), Chandigarh Bench has held that Cash Deposit shall not be treated as āUnexplainedā under Section 144 read with Section 147 of Income Tax Act, 1961 without affording the assessee a fair and reasonable opportunity to prove the Source of the deposit made by him in his bank account. The bench thus upheld the principles of Substantial Justice & Fair Play.
The two-member bench consisting of Shri A.D. Jain (Vice President) and Shri Vikram Singh Yadav (Accountant Member) set aside the previous orders and remanded the matter to the AO for fresh consideration indicating that the decision pertained to the procedural aspects of the case rather than the merits. The bench also directed the assessee to provide necessary information and documentation to support the claim regarding the source of the cash deposit. In the result, the appeal of the assessee is allowed for statistical purposes.
The New Delhi bench of the Income Tax Appellate Tribunal ( ITAT) held that the proper explanation of income of sales cannot be added under section 68 of the Income Tax Act,1961 unless it proved invalid.
The bench observed that an order passed by the Commissioner in holding that the sales cannot be added under section 68 of the Income Tax Act unless they are proved as bogus based on some reliable evidence was valid. The two-member bench comprising Narendra Kumar Billaiya, (Accountant) and Challa Nagendra Prasad (Judicial) held that the order passed by the Commissioner was as per the law and valid while dismissing the appeal filed by the revenue.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) granted relief to the ICICI bank by deleting the penalty imposed under section 14A of the Income Tax Act,1961 due to improper filing of return of income.
The two-member bench comprising Amit Shukla(Judicial ) and Rifaur Rahman(Accountant) held that the penalty levied on the same amount was not maintainable while dismissing the appeal filed by the revenue.
The Banglore Bench of the Income Tax Appellate Tribunal (ITAT) has held that Tax Exemption is allowable on interest income received on temporarily fixed deposits (FD).
The two-member bench of George George K. (Judicial Member) and Laxmi Prasad Sahu (Accountant Member) has observed that āinterest income earned by the Company of parking surplus funds with the bank by a special category of the assessee i.e. SEZ unit covered under Section 10AA of the Act. was an integral part of export business activity and business decisions taken given the commercial expediency. Hence such interest income earned incidentally could not be de-linked from its profit and gains derived from the export profit of the unit and could not be taxed separately.ā
The New Delhi bench of the Income Tax Appellate Tribunal (ITAT) directed re-adjudication to the assessing officer for making an addition to house hold drawings due to a delay in filing a reply to the notice issued by the assessing officer.
The two-member bench comprising N. K. Billaiya(Accountant) and C.N. Prasad( Judicial) held that considering the age of the assessee does not find any merit in the addition made by the assessing officer and directed to re-adjudicate the matter while allowing the appeal filed by the assessee.
The Pune bench of the Income Tax Appellate Tribunal (ITAT) directed re-adjudication on the Intimation order passed under section 154 of the Income Tax Act,1961 for disallowing the payment of remuneration to partners.
The two-member bench comprising S. S. Godara ( Judicial )And Induri Rama Rao (Accountant)held that to allow the claim for deduction of the partnerās remuneration, the return of income should be accompanied by the partnership deed and in the absence of such requirement under law, this cannot be treated as an incorrect claim. It was also directed to the re-adjudicate to amend the intimation by deleting the addition on account of the partnerās remuneration while allowing the appeal filed by the assessee.
The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has directed adjudication as the assessment order was passed without proper examination of residential status.
The two-member Bench of B.R. Baskaran, (Accountant Member) and Sandeep Singh Karhail, (Judicial Member) allowed the appeal filed by the assessee holding that the Commissioner of Income Tax Appeals (CIT(A)) neither sought any remand report from the AO nor considered any of the aforesaid documents while dismissing the assesseeās appeal in respect of the computation of long-term capital gains. Further, there was no examination of the correct residential status of the assessee by any of the lower authorities.
The Mumbai bench of the Income Tax Appellate Tribunal ( ITAT) directed re-adjudication for the addition made by the assessing officer under section 56(2)(x) of the Income Tax Act,1961 due to the failure of disclosure of income on the bank account.
The two-member bench comprising B.R. Baskaran(Accountant ) and Pavan Kumar Gadale(Judicial) directed the assessing officer to re-adjudicate the matter to delete the addition made under section 56(2)(x) of the Income Tax Act while allowing the appeal filed by the assessee.
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