This yearly digest analyzes all the ITAT stories published in the year 2023 at taxscan.in
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has ruled that income from car parking rental is eligible for Deduction under Section 80IA of Income Tax Act 1961.
The tribunal observed that car parking rentals have been reckoned as authorized operation in SEZ. In the light of express guidelines issued by the Government as referred to and relied upon,it was that the income from car parking rental would squarely qualify for deduction under Section 80IAB of the Income Tax Act. Hence, the bench consists of two members Anil Chaturvedi (Accountant Member) Anubhav Sharma (Judicial Member) allowed the appeal filed by the assessee.
The New Delhi bench of the Income Tax Appellate Tribunal (ITAT) held that the transfer of title in respect of immovable property takes place only through a registered sale deed.
The two-member bench comprising Saktijit Dey (Judicial) and N.K. Billaiya ( Accountant) held that the decision made by the Commissioner of Income Tax (Appeals) by deleting the addition made by the assessing officer was as per the law while dismissing the appeal filed by the revenue.
The Bangalore bench of the Income Tax Appellate Tribunal (ITAT) deleted an addition made by the assessing officer on the ground of joint account income does not considered as unexplained income under section 69A of the Income Tax Act,1961.
The bench observed that when the amount had been transferred to the account which was also the assessee’s joint account with the assessee’s wife and it cannot be considered as unexplained money under section 69A of the Income Tax Act and the assessee explained the sources as the opening balance standing in the assessee’s account. The two-member bench comprising Chandra Poojari (Accountant) and Beena Pillai (Judicial) held that the addition made under section 69A of the Income Tax Act was deleted while allowing the appeal filed by the assessee.
The New Delhi bench of the Income Tax Appellate Tribunal (ITAT) directed the assessing officer to re-adjudicate the assessment order under section 144 of the Income Tax Act,1961 without giving sufficient opportunity to the assessee.
The two-member bench comprising Chandra Mohan Garg (Judicial) and Pradip Kumar Kedia (Accountant) restored the matter to the assessing officer for fresh adjudication of points raised per the law after giving a proper opportunity to the assessee while allowing the appeal filed by the assessee.
The New Delhi bench of the Income Tax Appellate Tribunal (ITAT) held that the payment of a higher tax rate of interest under commercial expediency cannot attract any kind of disallowance defined under section 40A(2) of the Income Tax Act,1961.
The two-member bench comprising Chandra Mohan Garg (Judicial) and Pradip Kumar Kedia (Accountant) held that the payment of a higher rate of interest under commercial expediency and convenience cannot be alleged as unreasonable attracting the disallowance under section 40A(2) or any other provisions of the Income Tax Act. Additionally, it was held that the entire disallowance made by the assessing officer is liable to be deleted while allowing the appeal filed by the assessee.
The New Delhi bench of the Income Tax Appellate Tribunal (ITAT) held that the cost of goods cannot be included in the part of Profit Level Indicator (PLI) while computing the net profit margin under section 10(B)(1)(e ) of the Income Tax Act,1961.
The two-member bench comprising G.S. Pannu (President) and Saktijit Dey ( Judicial) directed the assessing officer to re-adjudicate the computation of Arm’s Length Price (ALP) by applying Profit Level Indicator (PLI) of operating profit to value-added cost, excluding the cost of goods while allowing the appeal filed by the assessee.
The Pune bench of the Income Tax Appellate Tribunal (ITAT) directed the assessing officer to re-adjudicate the addition made on account of sundry creditors’ balances due to improper explanation on the part of the assessee.
The two-member panel comprising S.S. Viswanethra Ravi (Judicial) and G.D. Padmahshali (Accountant) directed the assessing officer to re-adjudicate the matter to decide the issue afresh in terms of value-added tax returns and reconciliation of purchases while allowing the appeal filed by the assessee.
The New Delhi bench of the Income Tax Appellate Tribunal (ITAT) upheld the re-assessment order passed by the assessing officer quashed by the Commissioner of Income Tax (Appeals) on the ground of reopening had been done on unverified information.
The two-member bench comprising Saktijit Dey (Judicial) and N. K. Billaiya (Accountant) held that the deletion of the re-assessment order of the assessing officer by the Commissioner of Income Tax (Appeals) was as per the law and sustainable while dismissing the appeal filed by the revenue.
The Ahmedabad Bench of Income Tax Appellate Tribunal (ITAT) held that a charitable organization should not be deprived of the benefit of exemption available to it under Section 11 of the Income Tax Act, 1961 merely on the technical lapses and thus ordered for de-novo adjudication.
The Two Bench members comprising of Waseem Ahmed, Accountant Member and T.R. Senthil Kumar, Judicial Member observed that there was an inordinate delay in filing the appeal by the assessee but considering the merit of the case the delay is condoned.
The Kolkata bench of the Income Tax Appellate Tribunal (ITAT) held that no penalty can be imposed if the assessee proves that there was a reasonable cause for delay in filing books of account under section 273B of the Income Tax Act,1961. The two-member bench comprising Manish Borad (Accountant) and Sonjoy Sarma (Judicial) held that the penalty levied under section 273B of the Income Tax Act was not as per the law and deleted the penalty while allowing the appeal filed by the assessee.
The Chennai bench of the Income Tax Appellate Tribunal (ITAT) upheld the deletion of addition made under section 69A of the Income Tax Act,1961 by the Commissioner of Income Tax (Appeals) on the ground of genuine disclosure of the transactions filed in the Return of Income (ROI).
The two-member bench comprises Mahavir Singh (Vice President) and Manjunatha. G (Accountant) upheld the deletion of addition by the Commissioner of Income Tax (Appeals) while dismissing the appeal filed by the revenue.
The New Delhi bench of the Income Tax Appellate Tribunal (ITAT) held that the violation of procedural norms does not extinguish the substantial right of claiming the credit of Foreign Tax Credit (FTC) under section 90 of the Income Tax Act,1961.
The two-member bench comprising Saktijit Dey (Judicial ) and N. K. Billaiya (Accountant) directed the assessing officer to allow the credit of foreign tax credit (FTC) while allowing the appeal filed by the assessee.
The Chennai bench of the Income Tax Appellate Tribunal (ITAT) held that the payment made to the non-resident doesn’t amount to deduction in tax under Section 195 of the Income Tax Act, 1961.
The two-bench member comprising of V. Durga Rao (Judicial member) and Manish Borad (Accountant member) hold that the Commissioner of Income Tax (Appeal) was justified in deleting the disallowance made by the Assessing Officer under Section 40(a)(ia) of the Income Tax Act.
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) held that addition could not be made on cash deposited to the bank account from husband’s savings for payment of bank loan.
The tribunal after reviewing the facts observed that without proper verification of the facts AO made additions towards the deposits. Thus, the lower authorities were not justified in making the entire amount deposited in the bank as an unexplained income. Hence, a single bench of tribunal Kul Bharat Judicial Member deleted the addition made by the assessing officer and allowed the appeal filed by the assessee.
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) while granting relief to Honda Access held that pre – operative expenses of developing business activities should not be disallowed.
A bench consisting of two members, N.K.Billaiya, (Accountant Member) Dr. S. Anubhav Sharma (Judicial Member) observed that Tax Authorities below erred in concluding that assessee’s business was not ‘set up’ during previous year, to deny the claim of loss or to categorize certain expenses as pre-operative expenses.
The Chennai bench of the Income Tax Appellate Tribunal (ITAT) held that the amount given by the co-purchaser for service towards arranging sales is income.
The two-bench member consisting of Manjunatha G (Accountant member) and Manomohan Das (Judicial member) held that the Commissioner of Income Tax (Appeal) has correctly decided the matter. Nataraj Ganesh, the payer of the amount claimed that the amount of Rs. 70,00,000/- was paid to the assessee as the cost of the property. The claim of Nataraj Ganesh cannot be ignored as he was the payer of the money. Thus, the appeal was decided against the assessee.
The Chennai bench of the Income Tax Appellate Tribunal (ITAT) held that the power of attorney should be verified in the sale of an inherent property.
The two-bench members comprising of Manjunatha. G (Accountant member) and Manomohan Das (Judicial member) held that the PCIT has rightly observed that the assessment order as framed by the assessing officer is erroneous and prejudicial to the interest of Revenue. Therefore, the order of the PCIT was confirmed which he had set aside the assessment order and directed the assessing officer to frame the assessment after making necessary enquiry and verification in accordance with the law in respect of the issues discussed by the PCIT in the exercise of powers under section 263 of the Income Tax Act.
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT), while deleting the addition made by the Assessing officer (AO), determined that the cash deposited in bank accounts during the demonetization period was reflected in the books of account of the company.
After determining the facts and submissions made by both parties the bench consisting of two members, Narendra Kumar Billaiya (Accountant Member) Challa Nagendra Prasad (Judicial Member) observed that the assessee was maintaining complete stock tally, the sales were recorded in the regular books of accounts and the amount was deposited in the bank account out of the sale proceeds. Thus, the bench dismissed the appeal filed by the revenue.
The Kolkata bench of the Income Tax Appellate Tribunal (ITAT) directed the assessing officer to re-adjudicate the disallowance made under section 40(a)(a) of the Income Tax Act,1961 on the ground of nondisclosure of payment of transportation charges in income tax returns.
The two-member panel comprising Manish Borad (Accountant) and Sonjoy Sarma (Judicial) held that the assessee was entitled to get relief from the disallowance made by the assessing officer while allowing the appeal filed by the assessee.
The Pune Bench of the Income Tax Appellate Tribunal (ITAT) upheld the addition made under section 115BBC of the Income Tax Act, 1961 as Anonymous donations due to defects in maintaining record by the public trust society.
A bench consisting of two members, G. D. Padmashali (Accountant Member) S. S. Godara (Judicial Member) observed that assessee society failed to maintain the identity of the person indicating full name and full address. Therefore, all cash donation transactions are sham.
The Ahmedabad Bench of Income Tax Appellate Tribunal (ITAT) restored the matter to the file of the Assessing Officer (AO) for proper verification and calculation of refund receivables to grant interest to the assessee under Section 244A of the Income Tax Act, 1961.
The Tribunal remanded back the matter to the file of the AO for proper verification and calculation which was placed by the assessee before the Revenue authorities in consonance with Section 244A of the Income tax Act. Thus, the assessee was given an opportunity of hearing by following the principles of natural justice.
The Ahmedabad Bench of Income Tax Appellate Tribunal (ITAT) held that for initiating proceeding under Section 153C of the Income Tax Act, 1961, it is not necessary that these books of account should be incriminating.
The Tribunal stated that no satisfaction note of the AO, the searched person is required regarding documents relating to the assessee found during the course of search on some other persons for a valid assumption of jurisdiction to frame assessment under Section 153C of the Income Tax Act. The ITAT further held that for initiating proceedings under Section 153C of the Income Tax Act it is not necessary that these books of accounts should be incriminating and accordingly rejected this plea of the assessee.
The Bangalore Bench of Income Tax Appellate Tribunal (ITAT) directed the Assessing Officer (AO) to delete the disallowance under Section 115BBD of the Income Tax Act, 1961 and to recompute the deduction allowable to the assessee under Section 10AA of the Income Tax Act.
The Bench comprising of Beena Pillai, Judicial Member and Laxmi Prasad Sahu, Accountant Member set aside the order passed by AO on this issue and direct him to compute deduction under Section 10AA of the Income Tax Act. Further, the A.O. was not justified in invoking the provisions of Section115BBD of the Income Tax Act for making the impugned disallowance, accordingly directed the AO to delete the disallowance under Section 115BBD of the Income Tax Act.
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) ruled that lease rent and packaging charges derived under lease agreements for rendering manufacturing services to Indian Made Foreign Liquor (IMFL) is business Income .
The two member bench of tribunal comprising Anil Chaturvedi (Accountant Member) and Anubhav Sharma (Judicial Member) dismissed the appeal filed by the revenue and observed that the same issues are covered in favour of assessee
The Chennai bench of the Income Tax Appellate Tribunal (ITAT) held that disallowances under Section 40A (3) of the Income Tax Act, 1961 are not applicable when payment was by account payee cheque or account payee demand draft.
The two-bench member consisting of Mahavir Singh (Vice-president) and Manjunatha G (Accountant member) quashed the assessment order and reverse the order of the Commissioner of Income Tax (Appeal) and the Assessing Officer in favour of the assessee.
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) ruled that no addition could be made on immovable property purchased out of gifts received from relatives. Therefore, the bench directs re-adjudication.
A single-member bench of tribunal comprising Kul Bharat (Judicial Member) set aside the assessment order and restored the assessment to the file of the AO to frame the assessment afresh after verifying the claim of the assessee.
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) ruled that no addition could be made on account of fabrication charges paid to small time workers.
The two member bench of the tribunal comprising Shamim Yahya (Accountant Member) and Anubhav Sharma (Judicial Member) dismissed the appeal filed by the revenue and confirmed the deletion of addition upon the fabrication charges paid to small time workers .
The Visakhapatnam bench of the Income Tax Appellate Tribunal (ITAT) held that the Assessing Officer cannot travel beyond his jurisdiction in order to invoke the provision of section 40A(3) of the Income Tax Act, 1961.
The two-bench member comprising of Duvvuru Reddy (Judicial member) and S Balakrishnan (Accountant member) held that the assessing officer has travelled beyond his jurisdiction in disallowing the cash withdrawals being payments made to various fishermen by invoking the provisions of section 40A(3) of the Income Tax Act is not valid in law. Therefore, the order passed by the assessing officer was quashed and the appeal of the assessee is allowed.
The Visakhapatnam bench of the Income Tax Appellate Tribunal (ITAT) held that the provision of Section 44AB of the Income Tax Act, 1961 is not applicable to income which is treated as income from other sources.
The two-bench member consisting of Duvvuru RL Reddy (Judicial member) and S Balakrishnan (Accountant member) held that since the income had been treated as income from other sources and not as income from profit & gains of business or profession, the provisions of Section 44AB of the Income Tax Act are not applicable.
Therefore, there was no hesitation to delete the penalty of Rs. 1,42,260/- levied by the Assessing Officer. Thus, the appeal of the assessee is allowed.
The Chennai bench of the Income Tax Appellate Tribunal (ITAT) directed the assessing officer to re-adjudicate the rejection of the claim of deduction under section 54F of the Income Tax Act,1961 without obtaining any evidence for proof of construction done by the assessee.
The two-member bench comprises Manjunatha. G (Accountant) and Manomohan (Judicial) directed the assessing officer to re-adjudicate the claim of deduction filed under section 54F of the Income Tax Act while allowing the appeal filed by the assessee.
The Ahmedabad Bench of Income Tax Appellate Tribunal (ITAT) restored the matter to the file of the Commissioner of Income Tax (Appeals) [CIT (A)] for proper adjudication on the addition of Rs.29,74,617 under Section 69A of the Income Tax Act,1961 as unexplained, after taking cognizance of the evidences filed by the assessee.
The Single member Bench comprising of Ms. Suchitra Kamble, Judicial Member, condoned the delay of 98 days as non-representation before both the authorities appears to be genuine and further it remanded back the matter to the file of the CIT(A) for proper adjudication of the issues contested by the assessee after taking cognizance of the evidences filed by the assessee before the CIT(A). Thus, the assessee was given opportunity of hearing by following the principles of natural justice and the appeal was allowed.
The Visakhapatnam bench of the Income Tax Appellate Tribunal (ITAT) held that the contributions received for any charitable purposes cannot be treated as income under Section 2(24) (iia) of the Income Tax Act, 1961.
A Single-bench member consisting of Duvvuru RL Reddy held that contributions received for charitable purposes cannot be treated as income under Section 2(24)(iia) of the Income Tax Act and hence, the provision of Section 2(15) of the Income Tax Act does not apply to the instant case. Therefore, the appeal filed by the assessee is allowed.
The Ahmedabad bench of the Income Tax Appellate Tribunal (ITAT) held that error in the sale of share transaction made by the broker of the assessee hence deleted the addition on client code modification.
A Single-bench member consisting of Suchitra Kamble (Judicial member) observed that the Assessing Officer in the assessment order has not given the specification of KETAN M. CHALISHAZAR (HUF) and KETAN M. CHALISHAZAR (INDIVIDUAL) in respect of the number of trades in which client code modification has been made by the broker M/s. Affluence Shares & Stock Pvt. Ltd.
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has deleted the disallowance of deduction claimed on account of payment of guarantee commission to associate enterprise.
The two member bench of the tribunal comprising N.K. Billaiya (Accountant Member) and Saktijit Dey (Judicial Member) the bench concluded that issue was already covered in favour of assessee. Thus, the bench deletes disallowance deduction claimed under Section 40(a)(i) of the Income Tax Act on account of payment of guarantee commission to Associate Enterprise.
The Bangalore bench of the Income tax Appellate Tribunal (ITAT) held that the assessee shall not be penalized for the actions of the tax consultant in claiming an excessive refund in return of income.
The two-bench member comprising of Chandra Poojari (Accountant member) and Beena Pillai (Judicial member) remitted the entire issue in dispute in both the appeals to the file of NFAC (First Appellate Authority) for reconsideration and to decide whether the assessee is bonafide in claiming an excessive refund in its return of income and decide accordingly.
The Visakhapatnam bench of the Income Tax Appellate Tribunal (ITAT) held that a mere estimate of cost by the Departmental Valuation Officer (DVO) doesn’t constitute material to concealment and hence deleted penalty imposed on account of difference of valuation.
The two-bench member comprising of Duvvuru RL Reddy (Judicial member) and S Balakrishnan (Accountant member) by referring to the case of CIT vs. Apsara Talkies deleted the proportionate penalty levied on account of the difference in the valuation by the DVO. Thus, the appeal of the assessee is partly allowed.
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) ruled that no addition could be made on expenses incurred for purchase of liquor from liquor from licensed suppliers .
The two member bench of the tribunal comprising Pradip Kumar Kedia (Accountant Member) and Chandra Mohan Garg (Judicial Member) observed that the cash transactions, in any case, have been subjected to TCS collections and are thus duly made chargeable to tax in the hands of the recipient. Further, no enquiries have been made on behalf of the Revenue to dislodge the bona fides of the cash purchases. Also, the suppliers and recipients of cash are identified parties.
The Jaipur Bench of the Income Tax Appellate Tribunal (ITAT) recently dismissed an ex parte order passed without considering the savings of the housewife deposited in a joint account.
The two member bench of the tribunal comprising Rathod Kamlesh Jayantbhai, (Accountant Member) and Dr. S. Seethalakshmi, (Judicial Member) remand the issue to the file of Assessing officer and direct to provide opportunity to assessee.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that no order shall be passed without affording reasonable opportunity of being heard to the assessee and hence set aside the order of the Commissioner of Income Tax (Appeal) [CIT(A)].
The two-bench member comprising of Amarjit Singh (Accountant member) and Sandeep Singh Karhail (Judicial member) held that the Commissioner of Income Tax (Appeal) rejected the evidence without calling for any further information from the assessee. Thus, none of the authorities have properly examined the evidence so furnished by the assessee in respect of the claim of exemption of agricultural income.
The Hyderabad Bench of Income Tax Appellate Tribunal (ITAT) held that on account of the mistake committed by the assessee, while filing the application i.e. error in submitting the correct application cannot be the reason to reject permanent registration under Section 80G(5) of the Income Tax Act, 1961.
The Bench comprising of Rama Kanta Panda (Accountant Member) and Laliet Kumar (Judicial Member) observed that though the assessee had committed a mistake in selecting the wrong section code 11 while making an application at the first instance, however, for such a mistake, the permanent registration cannot be denied.
Further it noted that the respondent is also duty bound to cross-verify the details, submitted by the assessee at the time of issuance of provisional certificate and should have issued a notice at that time by pointing out the wrong selection of section code by the assessee. Thus, the assessees as well as Revenue both are at fault.
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) ruled that no addition could be made on the basis of credit entry not entered in the book of account of the assessee .
The tribunal after considering the submission of the both parties observed that the only reason for making the addition is that Reebok India Co. Ltd has passed a credit entry in its books of account, which was not there in the books of the assessee Thus, when the assessee did not receive any goods, it did not enter its books of account. Reebok India Co. Ltd, had debited the assessee, passed credit entry in their books of account thus there is no differences.
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) held that business service charges paid to associate concern for providing Human Resource (HR) related services should not be disallowed.
The two member bench of the tribunal comprising N. K. Billaiya (Accountant Member) and Saktijit Dey (Judicial Member) allowed the appeal of the assessee and held that business advisory services charges should not be disallowed .
The Ahmedabad Bench of Income Tax Appellate Tribunal (ITAT) held that the addition made by the Assessing Officer (AO) Transfer pricing Officer (TPO) on account Transfer Pricing (TP) adjustment is without having valid jurisdiction therefore directed such income tax addition to be deleted.
The Bench comprising of Waseem Ahmed, Accountant Member and Siddhartha Nautiyal, Judicial Member, observed that the right course of action for the AO was to take the approval from the competent authority for expanding the scope of Limited Scrutiny to the regular assessment but he failed to do so. Further the Bench noted that, the DR has also not brought anything on record justifying that the “Limited Scrutiny” was converted by the Assessing Officer under normal/ regular scrutiny after obtaining necessary approval from the appropriate authority.
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