This Round-Up analytically summarizes the key stories related to the Income Tax Appellate Tribunal (ITAT) reported at Taxscan. from October 7 to October 14, 2023
The Income Tax Appellate Tribunal (ITAT), Delhi bench, held that receipts from providing satellite telecommunication services to Indian customers are not Royalty under India-Netherlands Double Taxation Avoidance Agreements (DTAA).
After reviewing the facts and records, the two-member bench of G. S. Pannu, (President ) and Challa Nagendra Prasad (Judicial Member) held that amounts received by the assessee for the use of transponder of tele-communication service charges are not royalty under section 9(1)(vi) of the Income Tax Act and also under Article 12(8) of Indo Netherland DTAA.
The Income Tax Appellate Tribunal (ITAT), Delhi bench, dismissed the appeal due to non-compliance with the notice issued by the Income Tax Department for determining the value of land under Section 50C of the Income Tax Act, 1961.
After reviewing the facts and records, the two-member bench of Rathod Kamlesh Jayantbhai (Accountant Member) and Sandeep Gosain (Judicial Member) dismissed the appeal due to non-compliance with the notice issued by the Income Tax Department for determining the value of land under Section 50C of the Income Tax Act.
The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has granted relief to Cleartrip holding that the proviso to Section 68 of the Income Tax Act would not be applicable to non-resident investors.
The two-member Bench of Prashant Maharishi, (Accountant Member) and Sandeep Singh Karhail, (Judicial Member) observed that it was correctly stated that though the identity of assessee decided in earlier years could be accepted but how the creditworthiness of the investor and genuineness of transaction needs to be tested with respect to each transaction independently. The Bench dismissed the appeal filed by the revenue holding that the assessee fairly showed their identification, creditworthiness, and the sincerity of the move. An investor who was not a resident was not covered by Section 68 of Income Tax Act. Even in the absence of other evidence, the assessee had independently demonstrated the type and source of the funds held by the non-resident 100% holding company investor.
The Bangalore Bench of Income Tax Appellate Tribunal (ITAT) has held that no tax is leviable on interest accrued on FD subjected to Central Bureau of Investigation’s (CBI) prohibitory order.
The Two-member Bench of Chandra Poojari,(Accountant Member) and Madhumita Roy, (Judicial Member) observed that the the lower authorities had committed an error in bringing the interest accrued on FD, which was subject to a prohibitory order by CBI Hyderabad, into tax in these assessment years under consideration and the same had to be taxed in the assessment year when it was actually received by the assessee or the right to receive accrued to the assessee.
The Bench partly allowed this ground of appeal filed by the assessee holding that because of the restraint order of the Court, there was no right accruing to the assessee to receive the income and accordingly the amount could not be treated as its income for the assessment year under consideration.In other words, the assessee had to pay the tax on the same on actual accrual of right to receive this impugned interest by the assessee in any assessment year and not in these assessment years.
The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) held that the extent that the date of allotment letter is relevant for determining FMV of asset/flat.
The Bench comprising of Vikas Awasthy, Judicial Member and S.Rifaur Rahman, Accountant Member observed that a bare perusal of first proviso to clause (x) of Section 56 of Income Tax Act would make it clear that where the date of agreement fixing the amount of consideration for the transfer of immovable properties and the date of registration are different, the stamp duty value on the date of agreement shall be taken into consideration for the purpose of Section 56(2)(x) of the Income Tax Act.
the Tribunal directed the AO to adopt the Fair Market Value of the property`determined by the DVO as in the case of assessee’s brother. Hence appeal of the assessee was allowed.
The Ahmedabad Bench of Income Tax Appellate Tribunal held that expenses involving freebies to the doctors given by pharmaceutical companies is subject to disallowance under Section 37(1) of the Income Tax Act,1961.
The Bench comprising of Waseem Ahmed, Accountant Member and T.R Senthil Kumar, Judicial Member relied on the decision of Supreme Court in M/s Apex Laboratories (P.) Ltd. (P.)Ltd. v. Dy. CIT where it was held that the Circular applicable on pharmaceutical companies and holding the judgment against the assessee, highlighted on the essence where the freebies or gifts have the potential to influence or manipulate the prescription of a medical practitioner which can be incentivize the doctor’s intention to avail more luxurious and expensive freebies offered by the pharmaceutical companies.
Therefore the Tribunal held that only so much of the expenses involving freebies to the doctors shall be subject to disallowance. Thus set aside the issue to the file of the AO for fresh/ de-novo verification of the expenses falling under the category of freebies. Hence, the grounds of appeal of the revenue and the assessee were allowed for statistical purposes.
The Income Tax Appellate Tribunal (ITAT), Delhi bench, held that no addition should be made under Section 68 of the Income Tax Act, 1961, based on surmises and conjectures. Therefore, the bench directed readjudication to verify the repayment of loans.
After reviewing the facts and records, the two-member bench of Pradip Kumar Kedia (Accountant Member) and Chandra Mohan Garg (Judicial Member) held that no addition should be made under Section 68 of the Income Tax Act based on surmises and conjectures. Further, the bench remits the matter back to the file of the AO for the limited purpose of verifying aspects of repayment of loans that remained outstanding at the end of the financial year 2012-13, relevant to AY 2013-14 in question.
The Ahmedabad bench of the Income Tax Appellate Tribunal (ITAT) held that the Assessing Officer has no power to reopen the assessment when an order is passed by the Income Tax Settlement Commission under Section 245D of the Income Tax Act, 1961.
The Two-member bench comprising of Suchitra Kamble (Judicial member) and Waseem Ahmed (Accountant member) held that the CIT(A) has rightly held that claims which are part of the resolution plan stood extinguished as well as once the Income Tax Settlement Commission has decided/settled the tax component between the assessee and the revenue, the revenue authorities do not have any power to reopen such assessment. Thus, the appeal filed by the revenue was dismissed.
The Raipur Bench of Income Tax Appellate Tribunal (ITAT) held that the penalty imposed by Assessing Officer (AO) during assessment proceeding under Section 271 of Income Tax Act,1961 is within the period of limitation contemplated in clause (a) of subsection (1) to Section 275 of the Income Tax Act.
The bench comprising of Ravish Sood, Judicial Member and Arun Khodpia, Accountant Member observed that the CIT(A) and, rightly so, the limitation for imposing penalty under Section 271(1)(b) of the Income Tax Act as per the time period contemplated in clause (a) of subsection (1) to Section 275 of the Income Tax Act, i.e six months from the end of the month in which appellate order was received. The ITAT order dated 17.12.2014, expired on 31.07.2015, therefore, the order dated 27.07.2015 imposing the aforesaid penalty was well within the limitation period.
It was held that unable to concur with the solitary contention advanced by the AR, i.e the penalty imposed by the A.O under Section 271(1)(b) of the Income Tax Act was barred by limitation, the Tribunal upheld the view taken by the lower authorities. Thus, the appeal of the assessee was dismissed.
The Income Tax Appellate Tribunal (ITAT), Jodhpur bench, held that late fees under Section 234E of the Income Tax Act, 1961, towards the belated filing of Tax Deduction at Source return should not be levied prior to 01.06.2016.
After reviewing the facts and records, the two-member bench of Rathod Kamlesh Jayantbhai (Accountant Member) and Dr. S. Seethalakshmi (Judicial Member) held that the late fees under Section 234E of the Income Tax Act could not have been levied in the intimation under Section 200A of the Income Tax Act for the delay in filing quarterly returns of TDS. The said power to levy fees has come into effect from 01.06.2015. Therefore, the bench vacated the levy under Section 234E of the Income Tax Act.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that the amount declared as an advance in the year under consideration and offered to tax in the subsequent year cannot be again added to the income of the assessee as it will result in double taxation.
The Two-member bench comprising of Prashant Maharishi (Accountant member) and Sandeep Singh Karhail (Judicial member) held that the CIT(A) had correctly directed the Assessing Officer to delete the addition of Rs. 2,20,68,779, which was declared as advance by the assessee in the year under consideration and offered to tax in the subsequent year on the basis of project completion.
Therefore, the bench didn’t find any infirmity in the directions of the CIT(A) to restrict the credit of TDS only with respect to the income of Rs. 9,79,79,884 for the assessment year 2008-09 and the balance excess claim for TDS be allowed in the subsequent years in which the income has been offered to tax as per the consistent accounting practice followed by the assessee. Accordingly, the order passed by the CIT(A) was upheld and the appeal of the Revenue was dismissed.
The Income Tax Appellate Tribunal (ITAT), Jodhpur bench, held that the Income Tax Department has no power to levy late fee and interest in respect of Tax Deduction at Source (TDS) as per intimation under Section 200A of the Income Tax Act, 1961 prior to the amendment of the law.
After reviewing the facts and records, the two-member bench of Rathod Kamlesh Jayantbhai (Accountant Member) and Dr. S. Seethalakshmi (Judicial Member) held that the late fees under Section 234E of the Income Tax Act could not have been levied in the intimation under Section 200A of the Income Tax Act for the delay in filing quarterly returns of TDS. The said power to levy fees has come into effect from 01.06.2015. Therefore, the bench allowed the appeal of the assessee.
The Delhi bench of the Income Tax Appellate Tribunal (ITAT) held that voluntary deposit of tax should not be considered as admission of guilt before receiving notice under Section 148 of the Income Tax Act, 1961. Hence, the bench deleted the penalty imposed under Section 271(1) of the Income Tax Act, 1961.
After considering facts and reviewing the records, the two-member bench of Astha Chandra (Judicial Member) and N. K. Billaiya (Accountant Member) held that voluntary deposit of tax should not be considered as admission of guilt before receiving notice under Section 148 of the Income Tax Act. M.P. Rastogi, counsel, appeared for the assessee, and Vivek Vardhan, counsel, appeared for the revenue.
The Ahmedabad Bench of Income Tax Appellate Tribunal (ITAT) held that the deletion of the disallowance of Education Expenditure under Section 37 of the Income Tax Act,1961 is justified because the assessee provided detailed information regarding Director’s Education Fees.
The Single Member Bench comprising of Ms. Suchitra Kamble, Judicial Member observed that the reopening itself is not justified as the assessee has given all the details related to the education fees of the director during the assessment proceedings passed under Section 143(3) of the Income Tax Act. In fact, it is mere change of opinion. Thus, application filed by the assessee under Rule 27 of the Income Tax Appellate Tribunal Rules, 1963 was allowed. Thus, the appeal of the Revenue was dismissed.
The Income Tax Appellate Tribunal (ITAT) Mumbai bench held that municipal tax paid by the society on behalf of flat owners is eligible for deduction under Section 24 of the Income Tax Act, 1961.
After considering the facts submitted and the circumstances, the two-member bench of S. Rifaur Rahman (Accountant Member) and Amit Shukla (Judicial Member) held that municipal tax paid by the society on behalf of flat owners is eligible for deduction under Section 24 of the Income Tax Act. Therefore, the bench allowed the ground raised by the assessee.
The Jaipur Bench of Income Tax Appellate Tribunal (ITAT) held that the assessee was deprived of the justice to be decided the merits of the registration on account of the shortage of timeto appear before the authorities to furnish genuiness of activities carried out by the trust.
The Bench comprising of Sandeep Gosain, Judicial Member and Rathod Kamlesh Jayantbhai, Accountant Member observed that Dr. Shiven Bhandari, Director didn’t appear before the CIT(E) and therefore, CIT(E) could not decide the issue about the genuineness of the activities of the assessee trust.
The Tribunal restored the matter back to the file of the CIT (E) to decide the dispute independently in accordance with law. Hence, the appeal of the assessee was allowed for statistical purposes.
The Chennai Bench of Income Tax Appellate Tribunal (ITAT) has held that the mere transfer of real estate and construction business is not a case of succession of the firm by a company rather a simple case of transfer of a certain line of business on slump sale basis. Thus the assessee is a transferee and paid the sale consideration and hence, it could not be subjected to any capital gains.
The Bench comprising of Mahavir Singh, Vice President and Manoj Kumar Aggarwal, Accountant Member held that the firm has merely transferred its real estate and construction business and this is not a case of succession of the firm by a company rather a simple case of transfer of a certain line of business on slump sale basis. The assessee is a transferee and paid the sale consideration and hence, it could not be subjected to any capital gains. Therefore, notice issued under Section 148 of Income Tax Act was invalid and no fault could be found in the impugned order of CIT(A).
The Income Tax Appellate Tribunal (ITAT), Mumbai bench, while upholding the addition made by the assessing officer, observed that the assessee failed to submit relevant information to determine the actual rent on an unfurnished flat based on the value of furniture and fittings of furnished flats.
After considering the facts submitted and the circumstances, the two-member bench of S. Rifaur Rahman (Accountant Member) and Amit Shukla (Judicial Member) held that the assessee failed to submit relevant information to determine the Actual Rent on Unfurnished Flat based on the value of Furniture and Fittings of Furnished Flats. Therefore, the bench confirmed the addition and dismissed the ground of the assessee.
The Income Tax Appellate Tribunal (ITAT) in Jodhpur held that no addition could be made for the delay in filing Form No. 10 within the due date of the Income Tax Return under Section 139 of the Income Tax Act, 1961, as it has been condoned by the Commissioner of Income Tax (Exemption).
After considering the facts submitted and the circumstances, the two-member bench of DR. S. Seethalakshmi (Judicial Member) and Rathod Kamlesh Jayantbhai (Accountant Member) held that no addition could be made for the delay in filing Form No. 10 within the due date of the Income Tax Return under Section 139 of the Income Tax Act, as it has been condoned by the Commissioner of Income Tax (Exemption).
The Income Tax Appellate Tribunal (ITAT), Delhi bench, while directing readjudication, observed that the assessee had failed to produce the books of accounts during the assessment proceedings due to a communication gap between the assessee’s representative and the company.
After considering the facts submitted and the circumstances, the two-member bench of Yogesh Kumar U.S. (Judicial Member) and G.S. Pannu (President) allowed the additional evidence and directed readjudication in respect of the evidence.
The Raipur Bench of Income Tax appellate Tribunal (ITAT) held that on perusal of the statement of working and the supporting bank statements it is observed that the Home Loan of Rs. 69,00,000/- from HDFC Bank is divided equally between the co-owners but was not supported with any evidence, hence restored the matter to Assessing Officer (AO) for readjudication .
The Bench comprising of Ravish Sood, Judicial Member and Arun Khodpia, Accountant Member observed that on perusal of the said statement of working and the supporting bank statements it is observed that the Home Loan of Rs. 69,00,000/- from HDFC Bank is divided equally between the co-owners but was not supported with any evidence.
And further ordered that if assessee fails to comply with during the set aside assessment proceedings, AO would be at liberty to pass an order in accordance with law. Hence appeal of the assessee was partly allowed for statistical purposes.
The Hyderabad bench of the Income Tax Appellate Tribunal (ITAT) held that the assessee not having any reasonable cause for accepting the consideration, which is more than Rs.20,000/- by way of cash makes the appeal having no merit.
The two member bench consisting of R.K Panda (Vice President) and Laliet Kumar (Judicial member) held that the assessee not having any reasonable cause for accepting the consideration, which is more than Rs.20,000/- by way of cash and in view of the above, there is no merit in the appeal of the assessee. Thus the appeal was dismissed.
The Income Tax Appellate Tribunal (ITAT) Mumbai bench held that the Arm’s Length Price of the Employee Stock Option Plan (ESOP) expenses could not be taken as “NIL” for determining transfer pricing.
Furthermore, it provided Employee Stock Option Plans (ESOPs) in the form of Restricted Stock Units (RSUs) and Performance Share Units (PSUs) to those eligible under the equity compensation plan for its group entity. After considering the facts submitted and circumstances, the two-member bench of S. Rifaur Rahman (Accountant Member) and Rahul Chaudhary (Judicial Member) held that the ALP of the ESOP Expenses cannot be taken as ‘Nil’.
The Ahmedabad Bench of Income Tax Act Appellate Tribunal (ITAT) held that land sold by assessee is agricultural Land and did not qualify as “capital asset” in terms of Section 2(14)(iii) of the Income Tax Act,1961 . The claim of the assessee to the entire capital gain earned on these piece of land amounting to Rs.3,56,70,539/-, as not being liable to tax.
The Bench comprising of Smt. Annapurna Gupta, Accountant Member and Miss Suchitra Raghunath Kamble, Judicial Member observed that the land sold by the assessee, whether agricultural land or not, so as to determine its qualification as a “capital asset” in terms of Section 2(14)(iii) of the Income Tax Act, and thus facilitate finding whether capital gain earned thereon is taxable or not in terms of the provisions of law in this regard.
The Tribunal held that the impugned land did not qualify as “capital asset” in terms of section 2(14)(iii) of the Income Tax Act. The claim of the assessee to the entire capital gain earned on these piece of land amounting to Rs.3,56,70,539/-, as not being liable to tax is in accordance with law and thus set aside the impugned order passed by AO and confirmed by CIT(A). Hence, the appeal of the assessee was allowed.
The Court has taken significant action to rectify an issue concerning the delay in appeals that were previously dismissed by the Income Tax Appellate Tribunal (ITAT) and the Delhi High Court. The ITAT had rejected these appeals primarily due to a delay of 246 days, and the absence of any acceptable justification for condoning this delay.
As a result, the Court set aside the order issued by the ITAT on 16.02.2018, as well as the decisions of the High Court dated 06.08.2018 and 01082018. Consequently, the matters have been reinstated and transferred back to the Income Tax Appellate Tribunal for a thorough reconsideration of their merits. However, this restoration is contingent on the appellant paying a cost of Rs. 25,000 to the respondent. This significant decision rectifies the previous dismissal, ensuring a fair chance for the appellant to present their case and be heard on the merits of the appeals.
The Pune bench of the Income Tax Appellate Tribunal (ITAT) held that the matter be remitted to the file of the AO with a direction to pass the assessment order afresh as per law after allowing a reasonable opportunity of hearing to the assessee.
The single member bench consisting of R.S. Syal was of the opinion that it would be just and fair if the impugned order is set-aside and the matter is remitted to the file of the AO with a direction to pass the assessment order afresh as per law after allowing a reasonable opportunity of hearing to the assessee. Needless to say, the assessee will be at liberty to lead any fresh evidence in support of his case in the fresh assessment. Thus the appeal was allowed.
The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has allowed the deduction under Section 57 of the Income Tax Act 1961 as the director being not beneficiary could not be the assignee under keyman insurance policy.
The two-member Bench of B.R. Baskaran (Accountant Member) and Narender Kumar Choudhry (Judicial Member) observed that the company JMD had shown the premium payments as its investments. Further, the difference between the accumulated value of investments and the maturity amount has been declared by the above said company as its gains, meaning thereby, the assessee has only acted as conduit in collecting the maturity proceeds and remitting it to the company.
The Bench observed that, the only apprehension of PCIT was that the assessee could not have claimed deduction under Section 57 of the Income Tax Act, if the assessee was the assignee. The Bench allowed the appeal filed by the assessee and held that PCIT was not justified in initiating revision proceedings as JMD Auto India P Ltd was the beneficiary and not the assessee, meaning thereby, the assessee herein was not the assignee of the policy, as apprehended by PCIT.
The Ahmedabad bench of the Income Tax Appellate Tribunal (ITAT) grants an exemption under Section 11 of the Income Tax Act, 1961 as the income from charitable activities was reflected as income from other sources by mere punching error.
The Two-member bench comprising of Annapurna Gupta (Accountant member) and Madhumita Roy (Judicial member) held that the issue was restored back to the file of the Assessing Officer to consider the claim of the assessee to exempt its entire income earned from the charitable activities under Section 11 of the Income Tax Act after taking note of all the evidences filed by the assessee. This issue is to be considered along with 154 applications filed by the assessee since both relate to the same aspect. Thus, the appeal of the assessee was allowed for statistical purposes.
The Raipur Bench of Income Tax Appellate Tribunal (ITAT) has upheld the penalty under Section 271B of the Income Tax Act holding that the charitable institution would be liable for tax audit under Section 44AB of the Income Tax Act for activities prior to the registration under Section 2(15) of the Income Tax Act.
The two-member Bench of Ravish Sood, (Judicial Member) and Arun Khodpia, (Accountant Member) observed that certain conduct of the assessee in filing of return in form ITR5, showing itself as an AOP/BOI, offering the surplus as taxable income. It was also a fact that the assessee was in position of registration under Section 12AA dated 18/12/2017 when the return for AY 2017-18 was filed on 15-03-2018.
The Bench dismissed the appeal filed by the assessee and upheld the penalty imposed under Section 271B of the Income Tax Act.
The Ahmedabad Bench of Income Tax Appellate Tribunal (ITAT) has allowed the gratuity premium paid towards the Life Insurance Corporation (LIC) holding that the contribution made towards fund is business expenditure allowable under Section 37 of the Income Tax Act even if the fund was unapproved by the Income Tax Department.
The two-member Bench of Annapurna Gupta, (Accountant Member) and Madhumita Roy, (Judicial Member) observed that the assessee also pointed out that none of the dealers to whom the commission was paid was a related party of the assessee as per Section 40A(2)(b) of the Income Tax Act, and that payments were made through cheque after deducting TDS.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has directed re-adjudication as the notices for fixing date of hearing sent on incorrect email address.
The two-member Bench of C.M. Garg, (Judicial Member) and Girish Agrawal, (Accountant Member) considering the facts on record and the discrepancy pointed out as noted above, found that it was proper to remit the matter back to the file of Commissioner of Income-Tax(Appeals) for fresh adjudication by affording reasonable opportunity of being heard to the assessee and allowing him to make his submission in support of the claim.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that the valuation of the sale consideration shall be made after seeking the valuation report from the valuation officer as per Section 50C of the Income Tax Act, 1961.
The bench found no basis in the findings of the Assessing Officer, which have been upheld by the Commissioner of Income Tax (Appeal) [CIT(A)], in adopting the value of Rs. 4,99,99,000 as deemed sale consideration without referring the valuation of the land to the Valuation Officer as per the provisions of Section 50C of the Income Tax Act. Therefore, the issue was restored back to the file of the Assessing officer for de novo adjudication after seeking a valuation report from the Valuation Officer as per the provisions of Section 50C of the Income Tax Act. The impugned order was set aside and the appeal of the assessee was allowed.
The Jaipur bench of the Income Tax Appellate Tribunal (ITAT) held that the penalty under Section 271(1)(b) of the Income Tax Act, 1961 cannot be imposed if the assessee proves that there was a reasonable cause for the non-compliance of notices.
Further, the time given to furnish the reply was very short considering that between two days were Saturday and Sunday. There was a reasonable cause for non-compliance of the notice. The bench did not concur with the findings of the CIT(A) and thus the penalty confirmed by the CIT(A) under Section 271(1)(b) of the Income Tax Act was directed to be deleted. Thus, the appeal of the assessee was allowed.
The Pune bench of the Income Tax Appellate Tribunal (ITAT) granted another opportunity to the assessee due to the change of chartered accountant the assessee didn’t receive the notices.
The Single-member bench comprising of R.S. Syal (Vice-President) was of the opinion that it would be just and fair if the impugned order was set aside and the matter was remitted to the file of the Assessing Officer with a direction to pass the assessment order afresh as per law after allowing a reasonable opportunity of hearing to the assessee. The assessee will be at liberty to lead any fresh evidence in support of his case in the fresh assessment. Thus, the appeal of the assessee was allowed.
The Delhi bench of the Income Tax Appellate Tribunal (ITAT) held that if due to an erroneous order of the AO, the revenue is losing tax lawfully payable by a person, it will certainly be prejudicial to the interest of the revenue.
The assessment framed by AO under section 143(3) r.w.s. 147 of the Act and the A.O. had recorded various reasons for reopening assessment and went on framing the assessment on the said basis and collected the information with reference to the reasons so recorded for reopening of the assessment and the A.O. was satisfied with the explanation given by the assessee regarding various issues raised by him. Now the PCIT cannot find fault with the action of the AO and direct A.O. to carry out further enquiry on the materials or judgments of the High Court which are not part of the assessment records. Accordingly, there is no merit in the issues raised by the PCIT in the order passed under Section 263 of the Income Tax Act. Accordingly, the order passed under section 263 of the Act by the PCIT was quashed. Thus the appeal was allowed.
The Raipur bench of the Income Tax Appellate Tribunal (ITAT) upheld the addition under Section 69A of the Income Tax Act, 1961 for the unexplained cash as the assessee adopted an evasive or lackadaisical approach and didn’t participate in the assessment proceedings.
The Two-member bench comprising of Ravish Sood (Judicial member) and Arun Khodpia (Accountant member) held that it was not a case where the CIT(A) had discarded any material available on the record and summarily dismissed the assessee’s appeal in limine for want of prosecution. Instead, it was a case where in the absence of any evidence whatsoever, whether documentary or otherwise, which would substantiate that the Assessing Officer was unjustified in treating the cash deposits of Rs.2,47,65,369/- in the assessee’s bank account as its unexplained money under Section 69A of the Income Tax Act, the CIT(A) had rightly sustained the addition made by the Assessing Officer under Section 144 of the Income Tax Act. Thus, the appeal of the assessee was dismissed.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that the payment of Euro 20,00,000/- (INR 14,33,15,000/-) received by the Appellant from VMI in terms of SA was consideration for transfer of goodwill and the capital gains arising from the aforesaid transaction were correctly offered to tax by the appellant as capital gains.
The two member bench consisting of B.R. Baskaran (Accountant member) and Rahul Chaudhary (Judicial member) held that the payment of Euro 20,00,000/- (INR 14,33,15,000/-) received by the Appellant from VMI in terms of SA was consideration for transfer of goodwill and the capital gains arising from the aforesaid transaction were correctly offered to tax by the Appellant as capital gains. The Assessing Officer was directed to accept the capital gains of INR 13,83,15,000/- offered to tax by the Appellant in the return of income after verification of the computation. In view of the aforesaid, the other contentions/submission advanced by both the sides in relation to payment under consideration being in the nature of compensation for termination of agency or otherwise are rendered academic and therefore, not adjudicated upon. Thus the appeal was partly allowed.
The Income Tax Appellate Tribunal (ITAT ) Delhi bench during the appeal proceedings observed that the lower authorities did not consider sale deeds for determining the nature of sold land as agricultural. Thus the bench directed readjudication for verifying the nature of land sold by assessee.
After considering the facts submitted and circumstance , the two member bench of N.K.Billaiya (Accountant Member ) and Anubhav Sharma, (Judicial Member) are restored to the files of ld. CIT(A) to examine the nature of land on the date of registered agreement to sale on 26.08.2008 and then ascertain whether the land sold would fall within the definition of capital asset u/s 2(14) of the Income Tax Act.
The Kolkata bench of the Income Tax Appellate Tribunal (ITAT) allowed the claim of the long-term capital loss under Section 50B of the Income Tax Act, 1961 when the Form 3CEA was not filed with the income tax return (ITR) but was filed before the final order.
The bench was of the view that both the lower authorities ought to have treated the furnishing of Form 3CEA as sufficient compliance for the purpose of allowing long-term capital loss claimed by the assessee under Section 50B of the Income Tax Act. Therefore, the findings of the CIT(A) was set aside and the appeal of the assessee was allowed.
The Hyderabad bench of the Income Tax Appellate Tribunal (ITAT) held that in the interest of justice, it was proper to restore the issue to the file of the CIT(A) NFAC with a direction to grant one last opportunity to the assessee to substantiate its case.
The two bench member consisting of R.K Panda (Vice President) and Laliet Kumar (Judicial member) held that the totality of the facts of the case and in the interest of justice, it was proper to restore the issue to the file of the CIT (A) NFAC with a direction to grant one last opportunity to the assessee to substantiate its case and decide the issue as per fact and law. The assessee was also directed to appear before the CIT (A) NFAC on the appointed date without seeking any adjournment under any pretext failing which the CIT (A) NFAC is at liberty to pass appropriate order as per law. At the same time, due to the callous attitude of the assessee in ignoring the notices of the CIT(A) NFAC, the bench levied a cost of Rs.3000/- on the assessee which is to be paid to the PMs Relief Fund. Thus the appeal was allowed.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that the assessee has not furnished proper details as discussed above in order to substantiate its claim, in the interest of natural justice this issue may be restored to the file of AO for examining it afresh.
After hearing both the parties, the two bench member of the tribunal consisting of Narender Kumar Choudhry (Judicial member) and B.R. Baskaran (Accountant member) held that there should not be any dispute that when there was no actual receipt of money from Kukreja Constructions, the question of making any addition under Section 68 will not arise. Since the assessee has not furnished proper details as discussed above in order to substantiate its claim, in the interest of natural justice this issue may be restored to the file of AO for examining it afresh by considering relevant factual aspects. Accordingly, order passed by the CIT(A) on this issue was set aside and restored to the file of the Assessing Officer for examining the claim of the assessee that the differences in the account of M/s Kukreja Constructions and M/s Elyco Buiers were due to an accounting error. Thus the appeal was allowed.
The Delhi bench of the Income Tax Appellate Tribunal (ITAT) held that the power of revision under Section 263 of the Income Tax Act, 1961 cannot be exercised when there is proper enquiry made by the Assessing Officer.
The Two-member bench comprising of Shamim Yahya (Accountant member) and Astha Chandra (Judicial member) held that the Assessing Officer had issued a questionnaire along with statutory notices sent to the assessee in response to which the assessee had filed a written reply along with necessary documents and evidence. He perused and considered them. Not only this, the Assessing Officer called for books of account which he verified. So, there was not a case of no enquiry. Therefore, the bench vacated the order of the PCIT and restored the assessment order passed by the Assessing Officer under Section 143(3) of the Income Tax Act.
The Income Tax Appellate Tribunal (ITAT), Jaipur bench, held that the purchase/sale of immovable property for business purposes did not attract Section 50C of the Income Tax Act, 1961. Therefore, the bench deleted the addition made by the assessing office
After considering the facts submitted and the circumstances, the two-member bench of Rathod Kamlesh Jayantbhai (Accountant Member) and Dr. S. Seethalakshmi (Judicial Member) concluded that the purchase/sale of immovable property for business purposes did not attract Section 50C of the Income Tax Act.
The Bangalore Bench of Income Tax Appellate Tribunal (ITAT) has deleted the addition under Section 69B of the Income Tax Act 1961 as the bank accounts extract evidencing payment of purchase of jewellery was produced.
The two-member Bench of Chandra Poojari, (Accountant Member) and Madhumita Roy, (Judicial Member) dismissed the appeal filed by the assessee holding that the value of jewellery as on 31.3.2016 was Rs.2,611/- p.gm., the CIT(A) had arrived at the possible quantity of gold with the assessee as on 31.3.2016 weighing at 9089 gms. and thus, the quantity of gold found during the course of search was 8650.81 gms., which was lesser than the possible gold to be with assessee as on 31.3.2016 at 9089 gms. As such, he gave a relief to the assessee for having the gold, which is less than the possible gold to be with the assessee as on 31.3.2016.
The Bangalore Bench of Income Tax Appellate Tribunal (ITAT) has directed re-adjudication holding that the amounts invested by the cooperative societies as per Karnataka Co-operative Societies Act are entitled to deduction under Section 80P(2)(a)(i) of the Income Tax Act
“If the amounts are invested in compliance with the Karnataka Co-operative Societies Act, necessarily, the same is to be assessed as income from business, which entails the benefit of deduction u/s 80P(2)(a)(i) of the I.T.Act. Insofar as deduction u/s 80P(2)(d) of the I.T.Act is concerned, we make it clear that interest income received out of investments with cooperative societies is to be allowed as deduction.”
The Jaipur Bench of Income Tax Appellate Tribunal (ITAT) has deleted the penalty under Section 271B of the Income Tax Act 1961, as the turnover was below 2 crores as prescribed under Section 44AD of Income Tax Act 1961.
Thus, on conjoint reading of the Section the Bench held that the assessee was eligible to avail the benefit of presumptive taxation up to Rs. 2 crores turnover and the assessee had not controverted the provisions of Section 44AB of the Income Tax Act and since turnover was not exceeding the revised limit of Rs. 2 crores.
The Jaipur Bench of Income Tax Appellate Tribunal (ITAT) has quashed the revision order under Section 263 of the Income Tax Act 1961, holding that every loss of revenue as a consequence of the order of the Assessing officer (AO) could not be treated as prejudicial to the interest of revenue.
The Bench quashed the impugned order relying upon the Supreme Court decision in the case of CIT vs. Max India Ltd which held that, “The phrase ‘prejudicial to the interests of the Revenue’ in s. 263 of the IT Act, 1961, has to be read in conjunction with the expression ‘erroneous’ order passed by the AO. Every loss of revenue as a consequence of an order of the AO cannot be treated as prejudicial to the interests of the Revenue. For example, when the AO adopts one of two courses permissible in law and it has resulted in loss of revenue, or where two views are possible and the AO has taken one view with which the CIT does not agree, it cannot be treated as an erroneous order prejudicial to the Revenue, unless the view taken by the AO is unsustainable in law.”
The Ahmedabad Bench of Income Tax Act Appellate Tribunal (ITAT) held that children education, helper & uniform attire reimbursement, the same are coming under the purview of Section 10(14) of the Income Tax Act,1961 thus allowed tax free allowance on these perquisites.
The Bench comprising of Smt. Annapurna Gupta, Accountant Member and Ms. Suchitra Kamble, Judicial Member observed that it is pertinent to note that the incentive such as car reimbursement, driver salary reimbursement and telephone reimbursement comes under the purview of taxable income and thus the AO has rightly disallowed the same as they are perquisites. But, as regards to children education, helper & uniform attire reimbursement, the same are coming under the purview of Section 10(14) of the Income Tax Act and hence are allowable.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) while granting relief to Laxmi Narayan mandir trust held that Section 13(2)(a) of the Income Tax Act, 1961 doesn’t authorize the revenue to compute the notional interest when no such interest is charged by the trust.
Thus, in a case when no real interest was accrued or received nor the same was recorded by the assessee in its books of accounts, there were no merits in the findings of the CIT(A) in upholding the addition made by the Assessing Officer by computing the notional interest and adding the same to the total income of the assessee. Accordingly, the Assessing Officer was directed to delete the addition of Rs. 1,66,77,849 on account of notional interest income. As a result, the appeal of the assessee was allowed.
The Income Tax Appellate Tribunal (ITAT), Raipur bench, held that depreciation cannot be claimed on hired vehicles used in a Mining Contract. Therefore, the bench upheld the revision order.
The tribunal, while considering the appeal, observed that the hiring of vehicles in terms of Section 32 could not be specified. Further, the PCIT had rightly observed to disallow such additional depreciation when the vehicles are used in the assessee’s own business and not on hire. After reviewing the contentions of both parties, the two-member bench of Arun Khodpia (Accountant Member) and Ravish Sood (Judicial Member) upheld the revision order passed by the PCIT.
The Income Tax Appellate Tribunal (ITAT), Chennai bench, held that no enhanced cost was paid for the transfer of the textile spinning unit acquired through an auction sale of Bank of Baroda. Therefore, the bench allowed the depreciation.
After reviewing the contentions of both parties, the two-member bench of Manjunatha.G (Accountant Member) and Mahavir Singh (Vice President) allowed the depreciation claimed on the textile spinning unit acquired through an auction sale.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has held that the maintenance charges received from corporate members are governed by principle of mutuality and are exempted from tax.
In the instant case, as stated (supra), the maintenance charges received by the Assessee association from its corporate members would be exempt from tax on the basis of principle of mutuality. Merely because the same had been subjected to deduction of tax at source by the payer, the receipt would not partake the character of the taxable receipt. The receipt of said maintenance charges from corporate members would be still exempt in the hands of the Assessee and the Assessee would be eligible to claim refund of TDS on filing the returns.
The Income Tax Appellate Tribunal (ITAT) Mumbai bench while deleting the penalty imposed under Section 270A Income Tax Act, 1961 observed that no information received was by assessee in respect of interest on income tax refund to tax available at time of filing return of income.
After reviewing the contentions of the both parties the two member bench of Dr B.R.R. Kumar (Accountant Member) and C.M. Garg (Judicial Member) observed that the explanation of the assessee for not offering the interest on income tax refund while filing its return of income is bona fide. Therefore, the bench held that non-declaration of interest on income tax refund cannot be said to be under reporting of income by the assessee within the meaning of Section 270A of the Income Tax Act.
The Income Tax Appellate Tribunal (ITAT) Chennai bench held that excess gold jewellery stock found during the survey proceedings as stock transferred from proprietary concern to partnership firm, which was not an unexplained investment under Section 69B of the Income Tax Act, 1961.
After reviewing the contentions of the both parties the two member bench of Manjunatha.G (Accountant Member) and Mahavir Singh, (Judicial Member) held that excess gold jewellery in stock found during the survey proceedings as stock transferred from proprietary concern to partnership firm is not an unexplained investment under Section 69B of the Income Tax Act, thus directing to tax the same as business income of assessee.
The Income Tax Appellate Tribunal (ITAT ) Kolkata bench held that long Term Capital Gain (LTCG) from sale of equity shares of penny stock companies listed with Bombay Stock Exchange (BSE) is not eligible for exemption under Section 10(38) of Income Tax Act, 1961.
After considering the facts submitted and circumstance, the two member bench of Dr. Manish Borad,(Accountant Member ) and Sanjay Garg, (Judicial Member) dismissed the appeal of the assessee
The Income Tax Appellate Tribunal (ITAT) Pune bench held that, while noting the development of commercial projects by assessee along with residential projects directed readjudication for claiming deduction under Section 80IB (10) of the Income Tax Act, 1961
After considering the facts submitted and circumstances, the two member bench of G.D. Padmahshali (Accountant Member) and Partha Sarathi Chaudhury (Judicial Member) restored to the file of the NFAC for adjudication as per law and the assessee was directed to submit the details of residential units. The adjudicating authority was also directed to decide the case in accordance with natural justice principles.
The Bangalore Bench of Income Tax Appellate Tribunal (ITAT) remanded the ex-parte order to the files of Assessing Officer for re-adjudication in regards to the disallowance of deduction on business expenses for the payment of penalties to clients or customers for contract violations.
The Two Member Bench comprising of Chandra Poojari, Accountant Member and Ms. Madhumita Roy, Judicial Member observed that having regard to the penalty compensatory in nature and the assessment order is ex-parte, to meet the ends of justice it would be fit and proper to remit the issue to the file of the AO to verify the same afresh and to pass a reasoned order. The AO was further directed to give an opportunity of being heard to the assessee and to consider the evidence / judgment to be relied upon by the assessee during the course of hearing of the matter. Hence, the appeal filed by the assessee was allowed for statistical purposes.
The Chennai Bench of Income Tax Appellate Tribunal (ITAT) held that the donor has amply expressed the intention that the advances were given merely as gifts since the inception thus upheld the order of Commissioner of Income Tax (appeals) [CIT(A)] in deleting penalty under Section 271D of Income Tax Act.
The Bench comprising of V. Durga rao, Judicial Member and Manoj Kumar Aggrawal, Accountant Member observed that this transaction was recorded by the assessee in the accounts as “gift” which was evident from assessee’s capital account as furnished along with return of income. To support the same, the assessee has obtained confirmation letter from his aunt and furnished it before the AO. The assessee always considered the transaction as gift and never changed his stand at any point of time. It was only the donor who had given the confirmation letter and submitted the affidavit clarifying the transaction in the course of assessment proceedings. Thus, the donor has amply expressed the intention that the advances were given merely as gifts since the inception. This being the case, the impugned penalty has rightly been deleted by CIT(A). Therefore, the Tribunal did not find any reason to interfere in the same. Thus the appeal of the Revenue was dismissed.
The Income Tax Appellate Tribunal (ITAT) Delhi bench held that receipts from Indian Hotel Owners towards the centralized services provided by Westin Hotel Management are not taxable in India as Fee for Technical Service
After reviewing the facts and circumstances the two member bench of Dr. B.R.R. Kumar (Accountant Member) and Saktijit Dey (Vice-President) relied upon the decision of Delhi High Court in case of Director of Income-tax vs. Sheraton International Inc. and observed that revenue received by the assessee for providing centralized services is not in the nature of Fee for Technical Services (FTS) under Section 9(I)(vi) Explanation of Income Tax Act, but it is a business income. Since the assessee is not having any PE in India, its business income earned is not taxable in India. Therefore the bench dismissed the appeal filed by the revenue.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has upheld the addition of capital gain on slump sale of sugar unit on failure to furnish purchaser company confirmation and documentary evidence on conveyance deed.
The two-member Bench of Chandra Mohan Garg, (Judicial Member) and M. Balaganesh, (Accountant Member) dismissed the appeal filed by the assessee observing that the appellate had failed to furnish confirmation from the purchaser company and the documentary evidence particularly conveyance deed dated 08.09.2014 clearly revealed that the assessee received sale consideration of Rs. 75.50 crores in four instalments through banking channels from the purchaser company and therefore there was no reason to interfere with the findings of Assessing Officer making impugned addition to the capital gain income of assessee.
The Income Tax Appellate Tribunal (ITAT ) Delhi bench deleted the penalty under section 271AAA of the Income Tax Act, 1961 due to lack of opportunity to explain the undisclosed income source during the search proceedings.
After considering the facts submitted and circumstances, the two member bench of Dr. B. R. R. Kumar (Accountant Member) and C.M. Garg (Judicial Member) deleted the penalty under section 271AAA of the Income Tax Act due to lack of opportunity to explain the undisclosed income source during the search proceedings and due compliance with the all requirements of mandate of law envisaged in sub section (2) of Section 271AAA of the Income Tax Act.
The Delhi bench of the Income Tax Appellate Tribunal (ITAT) held that Transaction of shares not being in penny stocks canoot be covered by CBDT circular owing to low tax effect
After hearing both the parties, the two member bench of the tribunal consisting of Chandra Mohan (Judicial member) and Girish Agrawal (Accountant member) held that the Revenue is dismissed owing to the low tax effect. However, liberty was granted to the Revenue, if the learned Assessing Officer finds that appeal is not hit by the aforesaid CBDT Circular, he may approach the Tribunal in accordance with the appropriate provisions of law. Thus the appeal was dismissed.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) held that appellant failed to substantiate source of claim of investment in the said property for the purpose of Section 54F of the Income Tax Act and hence upheld the addition of Rs. 15,03,000/- made by the Assessing Officer (AO).
The Bench comprising of N. K. Billaiya, Accountant Member and Anubhav Sharma, Judicial Member held that addition of Rs. 15,03,000/-, there are no evidences except self serving affidavits of family members. The CIT(A) has rightly observed that AO has logically related the investment and availability of funds with the appellant, while holding that appellant failed to substantiate source of claim of investment in the said property for the purpose of Section 54F of the Income Tax Act. Hence the appeal of the assessee was dismissed on this ground.
The Delhi bench of the Income Tax Appellate Tribunal (ITAT) held that the onus which lays upon the assessee to explain that the entries made are real and not fictitious, has been duly discharged.
The two member bench consisting of Chandra Mohan Garg (Judicial member) and Pradip Kumar Kedia (Accountant member) were thus in agreement with the pith and substance of plea advanced on behalf of respondent assessee and endorsed the action of the CIT(A). Thus the appeal was dismiss
The Hyderabad Bench of Income Tax held that the assessee was not present before the Commissioner of Income Tax Appeals [CIT(A)] in the appellate proceedings and has not filed any document to substantiate his case, thus remanded the case to the file of Assessing Officer(AO) to review the claim of deduction under Section 54F of the Income Tax Act,1961.
The Single Member Bench comprising of Laliet Kumar, Judicial Member observed that it is abundantly clear that the assessee was not present before the CIT(A) in the appellate proceedings and has not filed any document to substantiate his case. Therefore the Tribunal remanded back the matter to the file of AO with a direction to review the claim of deduction under Section 54F of the Income Tax Act made by the assessee specifically with respect to the application of Section 50C of the Income Tax Act and the eligibility for deduction under Section 54F of the Income Tax Act. In case, the assessee failed to file any documents in support of his case, the AO shall decide the matter in accordance with the law. Hence, appeal of the assessee was allowed for statistical purposes.
The Bangalore Bench of Income Tax Appellate Tribunal (ITAT) held that addition under Section 69 of the Income Tax Act was not justifiable when the income was estimated under Section 44 A.D of the Income Tax Act,1961.
The Bench comprising of Chandra Poojari, Accountant Member and Ms. Madhumita Roy, Judicial Member refered the decision of the Cochin Bench that addition under Section 69 of the Income Tax Act was not justifiable when the income was estimated under section 44 A.D of the Income Tax Act.
The Bench comprising of Chandra Poojari, Accountant Member and Ms. Madhumita Roy, Judicial Member refered the decision of the Cochin Bench that addition under Section 69 of the Income Tax Act was not justifiable when the income was estimated under section 44 A.D of the Income Tax Act.
The Income Tax Appellate Tribunal (ITAT) Pune bench when deleting penalty imposed under Section 271AA of the Income Tax Act, 1961 held that the failure to produce the audit report by assessee in Form No.3CEB required under Section 92E Income Tax Act, 1961 occurred due to the opinion of Chartered Accountant (CA) of the assessee company.
After considering the facts submitted and circumstances, the two member bench of Padmavathy S (Accountant Member) and Vikas Awasthy (Judicial Member) held that Failure to produce audit report in form No.3CEB required under Section 92E of Income Tax Act occurs due to opinion of CA of assessee company. Therefore, the bench deleted the penalty imposed under Section 271AA of the Income Tax Act.
The Income Tax Appellate Tribunal (ITAT) Chennai bench held that the assessing officer passed the assessment order without examining taxability of land sold by the assessee. Therefore the order is erroneous and in so far as it is prejudicial to the interest of Revenue.Hence the bench upheld the revision order passed under Section 263 of the income tax act, 1961.
After considering the facts submitted and circumstances, the two member bench of Manoj Kumar Aggarwal (Accountant Member) and V. Durga Rao, (Judicial Member) held that the assessment order passed by AO was without examining taxability of land sold by assessee. Therefore the bench upheld the revision order.
The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has directed denovo benchmarking holding that the Resale Price Method (RPM) is the most appropriate method in international transactions of Celio future fashion pertaining to import of men’s wear for resale.
The Bench further noted that the Departmental Representative could not show us any reason to deviate from the aforesaid decision rendered in assessee’s own case and no change in facts and law was alleged in the relevant assessment year. Thus, respectfully following the order passed by the coordinate bench of the Tribunal in assessee’s own case the contention of the assessee in applying RPM as the most appropriate method had been upheld. Accordingly, this ground of appeal filed by the assessee was allowed and the order passed by the TPO/AO on this issue was set aside and the TPO/AO was directed to de novo benchmark the international transaction pertaining to import of men’s wear for resale‟ by applying RPM as the most appropriate method.
The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has directed for verification of sources explained through the settlement before the settlement commission for addition under Section 69 of the Income Tax Act 1961.
The two-member Bench of Amit Shukla (Judicial Member) and Padmavathy S. (Accountant Member) noticed that the assessing officer did not call for any further details from assessee to provide any additional details to substantiate the claim. Further the CIT(A) had allowed the appeal of the assessee by relying on the decision in the case of India bulls Financial Services Ltd., which was one of the applicants before the settlement commission. The Bench allowed the appeal filed by the revenue sending back to the assessing officer for a fresh examination and to verify whether the source for the additions made in the hands of the assessee was explained through the settlement made before the settlement commission. The assessee was directed to submit the relevant details before the assessing officer and cooperate with the proceedings.
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