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This yearly digest analyzes all the ITAT stories published in the year 2023 at taxscan.in
The Chennai bench of the Income Tax Appellate Tribunal (ITAT) has recently while quashing the reopening assessment under Section 148 of the Income Tax Act, 1961 held that there is no failure on the part of the assessee to disclose material facts during scrutiny assessment under Section 143(3) of the Income Tax Act, 1961.
The New Delhi bench of Income Tax Appellate Tribunal (ITAT) held that the payment of educational cess should not be allowed as an expenditure under section 37 and 40(a)(ii) of Income Tax Act 1961.
The two member bench comprising of Shri Yogesh Kumar U.S (Judicial) and Shri Anil Chaturvedi (Accountant) held that the education cess paid by the Assessee would not be allowed as an expenditure under Section 37 read with Section 40(a) (ii) of the Income Tax Act 1961 while dismissing the appeal.
The New Delhi bench of Income Tax Appellate Tribunal(ITAT) held that the claim of maintenance for building under Section 40(a)(ia) of Income Tax Act, 1961 rejected without proper verification of challan and papers by Commissioner.
The two member bench comprising of Shri Yogesh Kumar U.S (Judicial Member) and Shri Anil Chaturvedi (Accountant Member) held that the Commisioner had committed an error in making proportionate disallowance of building repairs treating the same against the rental income. It was thus held that the maintenance claim should be allowed made by the assessing officer and deleted the order passed by the Commissioner while allowing the appeal.
The Chennai bench of the Income Tax Appellate Tribunal (ITAT) has recently held that credit entries appearing in current and saving accounts are gross receipts from business transactions hence 8% profit rate should be applied.
It was observed by the bench that the assessee could not submit any documentary evidence that the profit rate is lower than 8% as computed by the AO. The assessee has not maintained any books of accounts nor any bills and vouchers. The two-member bench of Mahavir Singh, (Vice President) And Manjunath. G, (Accountant Member) dismissed the appeal filed by the assessee. S. Sridhar, advocate appeared for the assessee. AR.V. Sreenivasan, an advocate appeared for the revenue.
The Pune bench of Income Tax Appellate Tribunal (ITAT) has recently held that application for registration under Section 80G(5)(vi) of Income Tax Act, 1961 should not be allowable, if trust constructed building deriving funds from the trust on land owned by trustees.
It was observed by the tribunal that activity of construction of buildings as per the terms of the lease agreement is a direct benefit of the persons covered under Section 13(3) of the Income Tax Act which clearly violates the conditions mentioned under Section 80G(5)(vi) of the Income Tax Act. Further the lease agreement is not containing automatic renewal clause and the trustees can dispossess the assessee from the building constructed by the assessee from its funds. The assessee’s trust after deriving the benefit of donations and constructing buildings on the land belonging to the trustees is a tax free asset, will hand over the said tax free asset to the trustees at the end of lease period of 30 years. The Two member bench of S.S. Viswanethra Ravi, (Judicial Member) and G.D. Padmashali, (Accountant Member) upheld the order of CIT(Exemption), rejecting the application for grant of recognition under Section 80G(5)(vi) of the Income Tax Act.
The Pune bench of Income Tax Appellate Tribunal (ITAT) has recently while deleting the addition made by the Assessing Officer (AO) held that provision of Section 69A of the Income Tax Act should not be applied if assessee has brought plausible explanation regarding the source of jewelry found during search.
Tribunal while considering the appeal, observed that in terms of the CBDT Instruction dated 11.05.1994 the Assessing Officer treated 850 gms of gold jewellery as explained. As regards to the balance of jewellery of 107.48gms, the assessee had offered an explanation that this jewellery was acquired out of the agricultural income generated by the Bigger HUF on the lands held by it. This explanation cannot be termed as “not plausible explanation”. Therefore, if the Assessee brought plausible Explanation regarding Source of Jewelry Found during Search no addition can be made under Section 69A of the Income Tax Act. Hence, the two member bench of tribunal comprising Inturi Rama Rao (Accountant Member) and S. S. Viswanethra Ravi (Judicial Member) deleted the addition and allowed the appeal filed by the assesee.
The Amritsar Bench of Income Tax Appellate Tribunal (ITAT) has deleted the ex parte addition imposed under Section 68 of the Income Tax Act, 1961 made during the Covid-19 Pandemic.
The two-member Bench of M. L. Meena (Accountant Member) and S.H. Anikesh Banerjee (Judicial Member) observed that the assessee’s appeal was in hearing during the pandemic of Covid. It is pertinent that the entire amount of cash was duly verified by the auditors of the assessee. Both the assessment and appeal were ex parte and assessee was also denied to explain the source of cash deposit in the bank account The Tribunal Bench allowed the appeal directing to give a reasonable opportunity to submit the documents in favour of the argument.
The Bangalore bench of Income Tax Appellate Tribunal (ITAT) has recently held that interest-free funds advanced to sister concern for purchase land are revenue in nature.
It was observed by the tribunal that the AO proportionately disallowed the interest by holding that the interest should be capitalized as per proviso to section 36(1)(iii) of the Income Tax Act, 1961 because the assets were not put to use during the impugned assessment year. Moreover, on going through the ledger account of Naveen Hotels in the books of the assessee company, it was noticed that the interest-free funds have been given on various dates on a piece-meal basis and the amount has also been received back from the sister concern on different dates, but no interest has been charged on the advances. The two-member bench of George George K., (Judicial Member) and Laxmi Prasad Sahu, (Accountant Member) allowed the appeal filed by the assessee.
The Delhi Bench of Income tax Appellate Tribunal (ITAT) has held that disallowance under Section 14A of the Income Tax Act 1961 read with rule 8D could not exceed the quantum of exempted income earned during the particular assessment year.
The two-member Bench of Saktijit Dey, (Judicial Member) And M Balaganesh, (Accountant Member) deleted the penalty holding that as per the ratio laid down in various judicial precedents, the disallowance under Section 14A read with Rule 8D, could not exceed the quantum of exempt income earned during a particular assessment year. The Bench allowed the appeal filed by the assessee holding that there was a valid reason available to the assessee for restricting the disallowance to the extent of exempt income earned. Merely because assessee accepted the disallowance made by the Assessing Officer, it could not automatically lead to the conclusion that the assessee had under reported its income.
The Amritsar Bench Income Tax Appellate Tribunal (ITAT) has directed re-adjudication as the assessee could not be treated as non-filter or undisclosed of tax in return on wrong allotment.
The two-member Bench of M. L. Meena, (Accountant Member) and S.H. Anikesh Banerjee, (Judicial Member) observed that the assessee was allotted two PAN and the assessee was regularly filing the return and declared the income in old PAN. The Bench allowed the appeal holding that the assessee had never concealed his income or turnover before the revenue authorities and assessee could not be set as a non-filer or undeclared of tax in the return because he had made a wrong allotment of two PANs.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has denied exemption under Section 10(38) of the Income Tax Act 1961 holding that the assessee is lawfully bound to prove huge long term capital gain which was claimed to be genuine.
The two-member Bench of B.R.R Kumar, (Accountant Member) and Astha Chandra, (Judicial Member) in the light of the judicial precedents set out treating the impugned transactions as sham and discarding the assessee’s explanation as not satisfactory. The Bench upheld the disallowance of exemption under section 10(38) of the Act on long term capital gain holding that the assessee had failed to discharge the onus cast upon her under Section 68 of the Income Tax Act.
The Income Tax Appellate Tribunal, Chennai Bench, has recently, in an appeal filed before it, directed to delete the disallowance of expenditure incurred towards except income based on book profits.
Hearing the opposing contentions of both sides as submitted by Shri. R. Vijayaraghavan, the Advocate on behalf of the assessee, and by Shri. P. Sajit Kumar, the JCIT on behalf of the Revenue, the ITAT coram of V. Durga Rao, the Judicial Member and Manjunatha G, the Accountant Member thus, held: “We find that the issue of addition towards disallowance under Section. 14A r.w.r. 8D of the I.T. Rules, 1962, to book profit computed under Section. 115JB (2) of the Act, is covered in favour of the assessee by the decision of the ITAT Special Bench in the case of ACIT vs Vireet Investments Pvt Ltd, where it has been clearly held that the computation of clause (f) to Explanation (1) of section 115JB (2) of the Act, is to be made without resorting to the computation as contemplated under Section. 14A r.w.r. 8D of the I.T. Rules, 1962. Thus, by following the decision of ITAT Special Bench, we direct the Assessing Officer to delete additions made towards disallowance under Section. 14A r.w.r. 8D of the I.T. Rules, 1962 to book profit computed under Section. 115JB(2) of the Act.”
The Income Tax Appellate Tribunal (ITAT), Pune Bench, has recently, in an appeal filed before it, while setting aside the disallowance of vehicle expenses incurred, held that the use of vehicles by directors / employees as per the terms and conditions of employment, is not personal use.
Hearing the contentions of both sides as presented by Shri Sarvesh Khandelwal, on behalf of the assessee, and by Ms. Neha Deshpande, on behalf of the Revenue, the ITAT Panel of R.S Syal, the Vice- President, thus held: “I fail to see any rationale in disallowing the expenses incurred on cars as for personal use, when admittedly these have been provided to director-employees. A company is a separate legal entity distinct from its directors or employees. As such, there can be no question of treating the use of vehicles by the directors/employees as a personal use by the company. I, therefore, order for the deletion of disallowance of expenses incurred on vehicles.”
The Income Tax Appellate Tribunal (ITAT), Ahmedabad Bench, has recently, in an appeal filed before it, held that penalty under Section 271(1)(c) of the Income Tax Act is not leviable when no inaccurate particulars of income were furnished by the assessee.
Hearing the opposing contentions of both sides as submitted by Shri Jaimin Gandhi, the AR on behalf of the assessee, and by Shri R.R. Makwana, the Sr. DR on behalf of the Revenue, the ITAT coram of Suchitra Kamble, the Judicial Member, thus held: “The decision of Hon’ble Supreme Court in the case of CIT vs. Reliance Petroproducts, is apt in the present case as the assessee is under bonafide belief that interest income earned on bank deposits is also coming under the purview of claim for deduction under Section 80P of the Act. Thus, the penalty under Section 271(1)(c) of the Act fails on the count of furnishing inaccurate particulars of income. Therefore, the penalty does not survive.”
The Income Tax Appellate Tribunal (ITAT), Ahmedabad Bench, has recently, in an appeal filed before it, held that no penalty under section 271 (1) can be imposed when income surrendered by the assessee during survey is shown in the regular income tax return filed within prescribed time.
Hearing the opposing contentions of both sides as submitted by Shri Sarju Mehta, the A.R. for the assessee, and by Shri Atul Pandy, the Sr.D.R. of the Revenue, the ITAT coram of Annapurna Gupta, the Accountant Member and Shri T.R. Senthil Kumar, the Judicial Member, thus held: “The Hon’ble Delhi High Court in the case of CIT vs. SAS, had held that where income surrendered by assessee during survey had been shown by it in its regular income-tax return filed within prescribed time, penalty could be imposed. Thus, the CIT(A) has followed the above decisions and deleted the penalty on the declared income of Rs. 1,80,00,000/-. However, the CIT(A) had confirmed the levy of penalty on the balance disputed income of Rs. 4,08,097/-. Thus, we do not find any infirmity in the order passed by the CIT(A), who partly deleted the penalty levied under Section. 271(1)(c) of the Act. Thus, the grounds raised by the Revenue is devoid of merits and the same is dismissed.”
The Income Tax Appellate Tribunal (ITAT), Raipur Bench, has recently, in an appeal filed before it, on finding that unexplained money under section 69A was received back through banking channel as sale consideration of shares, upheld the addition made under Section 115BBE of the Income Tax Act.
Hearing the opposing contentions of both sides as submitted by Shri R.B Doshi, CA, on behalf of the assessee, and by Shri Piyush Tripathi, the Sr. DR, on behalf of the Revenue, the ITAT Coram of Ravish Sood, the Judicial Member thus held: “In terms of my observations, I concur with the view taken by the lower authorities and uphold the addition of Rs.5.40 lac made by the A.O, on the ground that the same was the undisclosed fund of the assessee that was routed back in the garb of the aforesaid transaction of purchase/sale of shares. Thus, the Grounds of appeal raised by the assessee being devoid and bereft of any merit, are dismissed in terms of my aforesaid observations.”
The Income Tax Appellate Tribunal (ITAT), Mumbai Bench, has recently in an appeal filed before it, held that interest income from FD is eligible for deduction under Section 10AA of the Income Tax Act, 1961.
Hearing the opposing contentions of both sides as submitted by Shri Nishant Thakkar and Jasmin Amalsadvala, on behalf of the assessee, and by Dr.Yogesh Kamat, the CIT DR along with Ashish Kumar, the Sr AR, on behalf of the Revenue, the Mumbai ITAT Coram of Amit Shukla, the Judicial Member and Padmavathy S, the Accountant Member thus held: “In assessee’s case, we notice that the assessee has placed the surplus funds in FDs and has earned interest from the same. The facts of assessee’s case being identical to the case of Hewlett Packard Global Soft Ltd, respectfully following the above full bench decision of the Hon’ble Karnataka High Court, we hold that the interest income earned by the assessee is eligible for deduction under section 10AA. Accordingly, we delete the disallowance made by the Assessing Officer in this regard.”
The Indore bench of Income Tax Appellate Tribunal (ITAT) has recently while quashing the assessment order passed under Section 143(3) of Income Tax Act 1961 observed that there is no notice issued and served under Section 143(2) within the prescribed time limit.
The two member bench of Chandra Mohan Garg, (Judicial Member) and Bhagirath Mal Biyani, (Accountant Member) observed that the revenue neither produced assessment records nor produced copy of notice under Section 143(2) of the Income Tax Act before the bench. Thus, the assessment order dated 29.12.2011 passed under Sections 154 and 143(3) of the Income Tax Act was held to be not valid or sustainable being passed by the AO without assuming valid jurisdiction by issuing notice under Section 143(2) of the Income Tax Act within prescribed time limit.
The Indore Bench of the Income Tax Appellate Tribunal (ITAT), deletes addition under Section 69B of the Income Tax Act and noted that the absence of seller before the Assessing Officer (AO) not a ground to allege unexplained investment.
The Two-Member Bench of the Tribunal comprising Chandra Mohan Garg, Judicial Member and Bhagirath Mal Biyani, Accountant Member observed that “Merely because the seller was not present in person before the Assessing Officer, the assessee cannot be alleged to have made any unexplained investment which could entitle the Assessing Officer to make addition under Section 69B of the Income Tax Act. Therefore, the CIT(A) was right in deleting the addition on this issue.”
The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT), denied income tax exemption under Section 10(23C)(vi) of the Income Tax Act on not existing solely for purposes of education.
The Two-Member Bench of the Tribunal comprising Om Prakash Kant, Accountant Member and Sandeep Singh Karhail, Judicial Member observed that “Since the assessee has been found to be not „existing’ solely for the purposes of education on the basis of the above findings, therefore, the other aspects raised in the impugned order become academic. Accordingly, the denial of exemption under section 10(23C)(vi) of the Income Tax Act is upheld.”
The Hyderabad Bench of the Income Tax Appellate Tribunal (ITAT), observed that the satisfaction under Section 151 of the Income Tax Act is not an empty formality and quashed income tax addition made in mechanical and stereotyped manner.
The Two-Member Bench of the Tribunal comprising R.K. Panda, Accountant Member and Laliet Kumar, Judicial Member observed that “The satisfaction as contemplated under Section 151 of the Income Tax Act is not an empty formality as the authorities have to apply their mind and record satisfaction. When the authorities were not oblivious to the date of proposal then it cannot be said that they have applied their mind or considered the proposal of the Assessing Officer in its right earnest.” “The satisfaction was recorded by authorities in a mechanical and stereotyped manner and therefore, the same is not a satisfaction in the eyes of law” the Bench concluded.
The Indore bench of Income Tax Appellate Tribunal (ITAT) has recently held that provision of section 269SS/269T Income Tax Act 1961 should not be applicable if Assessing Officer (AO) not found explanation regarding source of cash loans during search proceedings. Thus the bench deleted the penalty imposed by the AO.
The two member bench of Chandra Mohan Garg, (Judicial Member) and B.M. Biyani, (Accountant Member) concluded that sections 269SS/269T of the Income Tax Act and consequently Sections 271D/271E of the Income Tax Act could not be applicable in the assessee’s case. Thus the bench allowed the appeal of the assessee.
The Hyderabad Indore bench of Income Tax Appellate Tribunal (ITAT) has recently upheld the addition made by the Assessing Officer (AO) held that the number of cash receipts received as per cash book are not reflecting in the day book.
It was observed by the tribunal that, AO in the instant case made addition of Rs. 2,44,14,000/- on the ground that there is deficiency in the cash book on various dates and the assessee did not offer the income from profit on sale of land The CIT(A) without considering the nature of the entries found in the cash book which were not recorded in the day book, deleted the addition which is not justified. Therefore the two member bench of R.K. Panda, (Accountant Member) and Laliet Kumar, (Judicial Member) observed that, there is a difference between the introduction of cash as “other income” whenever there is deficiency in the cash book and income from “profit on sale of land” not recorded in the books of accounts.
The Cuttack bench of Income Tax Appellate (ITAT) held that the claim of exemption under section 10(38) of Income Tax Act, 1961 for the long term capital gain from the sale of equity shares before the ending of assessment proceedings is valid.
The tribunal bench observed that the assessee had not introduced his own unaccounted money by way of bogus long term capital gain, as all the entries were part of the bank account and the assessee dematerialized the shares in the account. A single member bench comprising of Shri George Mathan (Judicial Member) held that the addition as made by the assessing officer and as confirmed by the Commissioner in respect of the claim of exemption under Section 10(38) of the Income Tax Act, 1961 in respect of sale of shares was deleted while allowing the appeal.
The New Delhi bench of the Income Tax Appellate Tribunal (ITAT) held that the reopening of assessment proceedings under Section 147 of the Income Tax Act 1961 beyond the period of 4 years was not valid. The two-member bench comprising Shri Yogesh Kumar U.S (Judicial Member) and Shri Anil Chaturvedi (Accountant Member) held that the present appeal relied on various judicial pronouncements to support the contention that the reassessment proceedings initiated beyond four years from the end of the relevant assessment year were not valid in terms of proviso to Section 147 of the Income Tax Act while allowing the appeal.
The New Delhi bench of Income Tax Appellate Tribunal(ITAT) held that addition of long term capital gain can be made by the assessing officer under Section 69A of Income Tax Act, 1961 on account of investment in jewellery is not valid.
The bench observed that the most important details was the addition made on account of Long Term Capital Gains on the purported, notional, fictitious sale of jewellery and that there were loose diamonds as per the Wealth Tax Return and the jewellery seized which had been treated as unexplained investments, but the jewellery seized was intra polated in the jewellery found and no addition can be made on this account. The two member bench comprising of Shri. Yogesh Kumar US (Judicial Member) And Dr. B. R. R. Kumar (Accountant Member) held that the addition made under Section 69A of the Income Tax Act, 1961 was not valid and no addition can be made on this account while allowing the appeal.
The Jaipur bench of Income Tax Appellate Tribunal (ITAT) directed the matter back to the assessing officer for re-adjudication for penalty imposed under Section 271(1)(c) of the Income Tax Act 1961for the payment of commission without proper hearing of the parties.
The Bench noted that the Commissioner had passed an ex-parte order without providing adequate opportunity of being heard to the parties. It was also observed that the assessee should be provided one more opportunity to contest his case before the assessing officer as the assessee could not advance his arguments as to the penalty imposed under Section 271(1)(c) of the Income Tax Act, 1961. The two member bench comprising of Shri Sandeep Gosain (Judicial Member) And Shri Rathod Kamlesh Jayantbhai (Accountant Member) held that the matter was restored to assessing officer to decide it afresh while allowing the appeal.
The Indore bench of Income Tax Appellate Tribunal (ITAT) has recently held that physical cash found during survey is residual amount of cash withdrawn from firm against imprest account for expences.
The two-member bench of Chandra Mohan Garg, (Judicial Member) and Bhagirath Mal Biyani, (Accountant Member) dismissed the appeal filed by the revenue and deleted the addition made by the AO. Sumeet Neema counsel appeared for the assessee .P.K. Mishra, counsel appeared for revenue.
The Income Tax Appellate Tribunal (ITAT), Delhi Bench, has recently, in an appeal filed before it, dismissed the revenue’s appeal, on finding that there is lack of jurisdiction under Section 153C of the Income Tax Act owing to the absence of incriminating materials.
Hearing the opposing contentions of both sides as presented by Shri Gautam Jain, the Advocate on behalf of the asssessee, and by Shri T. James Singson, the CIT-DR, on behalf of the Revenue, the ITAT coram of Chandra Mohan Garg, the Judicial Member, and Pradip Kumar Khedia, the Accountant Member, thus held: “Having regard to the view expressed in AY 2012-13 by the Coordinate Bench, there is hardly any merit in the disallowance carried out by the Assessing Officer as held by CIT(A). Besides, we find merit in the findings rendered by the CIT(A) for lack of jurisdiction under Section 153C owing to absence of any incriminating material. We thus no perceptible reason to interfere with the order of the CIT(A). In the result, the appeal of the Revenue is dismissed”.
The Income Tax Appellate Tribunal (ITAT), Delhi Bench, has recently, in an appeal filed before it, held that deduction under Section 36(1) (va) is allowable only if employees’ share in relevant funds are deposited before due date stipulated in the respective Acts.
Hearing the contentions of the D.R and perusing the materials available on record, the ITAT Panel of Anubhav Sharma, the Judicial Member and Anil Chaturvedi, the Accountant Member, thus held: “We are of the view that the ratio of the decisions of Hon’ble Apex Court is applicable to the present facts. We therefore, following the decision of Hon’ble Apex Court in the case of Checkmate Services Pvt. Ltd., find no reason to interfere with the order of lower authorities and thus the grounds of assessee are dismissed.”
The Income Tax Appellate Tribunal (ITAT), Delhi Bench, has recently, in an appeal filed before it, held that interest receipt under TUFS scheme is capital in nature, needs to be excluded while working out book profits under Section 115JB.
Hearing the opposing contentions of both sides, as presented by Shri Satyajeet Goel, the Advocate on behalf of the assessee, and by Shri Kanv Bali, the Sr. DR on behalf of the Revdenue, the ITAT Panel of Yogesh Kumar US, the Judicial Member, and Anil Chaturvedi, the Accountant Member, thus held: “Following the decision of the coordinate bench in the case of Indogulf Cropsciences Ltd., we hold that since the interest receipt under TUFS Scheme is capital in nature, it needs to be excluded while working out the book profits under Section 115JB of the Act. We direct accordingly. Thus, the ground of the assessee is allowed.”
In the case of Britannia Industries Ltd, the Income Tax Appellate Tribunal (ITAT), Kolkata bench has quashed the revision order passed under section 263 since the revision was conducted without proper inquiry. The appellant, Britannia Industries Ltd.is engaged in the business of manufacturing and trading bakery and dairy products. The Pr. CIT while checking the assessment records noted that the appellant had claimed a double deduction of capital expenditure under section 35(1) and section 35(2AB) of the Act which ought to have been disallowed by the AO.
The Coram of Mr. Rajpal Yadav, Vice President,and Mr. Girish Agrawal, Accountant Member has held that “the issues raised by the PCIT in the revisionary proceedings, no action u/s 263 of the Act is justifiable which cannot be sustained under the facts and circumstances of the present case and judicial precedents dealt herein above. We, therefore, quash the impugned order u/s 263 of the Act and allow the grounds raised by the assessee”. Mr. Akkal Dudhwewala and Mr. Sudipta Guha appeared on behalf of the appellant and respondent respectively.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) quashed the order passed by the assessing officer under section 68 of the Income Tax Act,1961 for an addition made in the absence of incriminating material.
Shri Mani Jain and Shri Patreek Jain, the counsels for the assessee contended that the additions made by the assessing officer in these years were related to the sale of shares and estimated commission and noticed that the addition related to the sale of shares already recorded in the books and the commission expenses had been made on an estimated basis. The two-member bench comprising Smt. Kavitha Rajagopal (Judicial) and Shri B.R. Baskaran (Accountant) held that the additions made by the Assessing Officer under section 68 of the Income Tax Act,1961 are liable to be deleted while dismissing the appeal filed by the revenue.
The New Delhi bench of the Income Tax Appellate Tribunal (ITAT) held that no twin prerequisites for invocation of revisional powers under Section 263 of the Income Tax Act, 1961. M/s. Havells India Limited, the appellant assessee had filed an appeal against the revisional order of the Principal Commissioner of Income Tax which was held to be erroneous and prejudicial to the interest of the revenue.
The bench observed that no revenue benefit has been derived from the alleged error in the order and no extra credit had been availed in the later years. The two-member bench comprising Chandra Mohan Garg (Judicial) and Pradip Kumar Kedia( Accountant) held that the revisional order of the commissioner was set aside on the ground that the twin prerequisites for invocation of revisional powers under Section 263 of the Income Tax Act was not available in the present case while allowing the appeal.
The Mumbai bench of Income Tax Appellate Tribunal (ITAT) directed the assessing officer to grant the credit of Tax deducted at source (TDS) of Rs. 40.43 crores to the Reliance Infrastructure Limited.
The Bench observed that the deductor had refused to issue a certificate in favour of the assessee due to perceptions and apprehensions and there was no provision or mechanism to enforce such certificate from deductor which lead to denial of credit for TDS. It was also observed that no prescribed form available to make such rectification, leading to legal battles. The two member bench comprising of Amit Shukla (Judicial Member) And Padmavathy S (Accountant Member) directed the assessing officer to grant the Tax deducted at Source (TDS) credit of Rs 40.43 crores to the assessee while dismissing the appeal filed by the revenue.
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