The stories on the Income Tax Appellate Tribunal ( ITAT ) that were published at Taxscan.in from February 17, 2024 to February 23, 2024 are analytically summarized in this Round-Up.
In a recent decision, the Income Tax Appellate Tribunal ( ITAT ) in Mumbai shed light on the nature of royalty payments concerning the usage of brand names or trade names under a trademark license agreement, as per Section 9(1) (vi) of the India-Turkey Tax Treaty.
The tribunal, consisting of Gagan Goyal ( Accountant Member ) and Vikas Aswathy ( Judicial Member ), observed precedents, including the case of Global Cricket Corporation PTE Ltd., which deliberated on the taxability of payments received from sponsors for the use of Event marks and sign ages. The tribunal concluded that such payments do not fall under the category of royalty as per section 9(1)(vi) of the India-Turkey Tax Treaty.
In a major ruling the Ahmedabad bench of the Income Tax Appellate Tribunal ( ITAT ) observed that assessee entitled to claim Tax Deducted at Source (TDS) deduction in year on which corresponding Income offered to Tax on non-claiming of double deduction:
The two member bench of the tribunal comprising Waseem Ahamad ( Accountant member) and Siddhartha Nautiyal ( Judicial member) observed that if the assessee has not sought duplicate credit for TDS, they are entitled to claim TDS deduction in the year when the corresponding income has been declared for taxation and invoices have been raised on the payer. In this particular case, the assessee asserted that both the services and invoices were executed in the contested assessment year, i.e., A.Y. 2020-21, and additionally, they have not claimed TDS deduction in any previous assessment year.
In a significant ruling the Delhi bench of the Income Tax Appellate Tribunal ( ITAT ) observed that no justification for disallowance on Ad Hoc basis, without pointing out any deficiency in books in nature of business
The two member bench of the tribunal comprising Shamim Yahya (Accountant member) and Anubhav Sharma (Judicial member) concluded that there was no evidence to suggest that the assessee was presenting any new information that had not been previously available to the tax authorities. What had been established was that, without identifying any specific defects, a portion of the expenses was dismissed on an estimated basis. Such a practice was not legally sustainable
In a significant ruling, the Chennai bench of the Income Tax Appellate Tribunal ( ITAT ) has granted relief to Saint-Gobain India Pvt. Ltd., ruling that the excise refund and interest subsidy received as part of announced and sanctioned incentives constitute capital receipts
Taking in to consideration the point highlighted by the counsels, the tribunal of Manoj Kumar Agarwal ( Accountant member) and V. Durga Rao ( Judicial member) found that the Supreme Court in the case of Shree Balaji Alloys (supra), by considering its judgment in the case of CIT v. Ponni Sugars & Chemicals Ltd. (supra), dismissed the appeal of the revenue and upheld the judgment of High Court of Jammu & Kashmir in the case of Shree Balaji Alloys & Others v. CIT, wherein, the High Court has held Excise refund and interest subsidy received by the assessee in pursuance to the incentives announced and sanctioned are capital receipts.
A two member bench of Jaipur Income Tax Appellate Tribunal ( ITAT ) has held that the sale consideration as determined/adopted by the Stamp Duty Authorities, has to be adopted for the purposes of computation of capital gain.Thus, the intention of the legislature is quite clear that after this amendment, it is always the Stamp Valuation to be considered and there is no warrant to replace such figure in view of such binding legal fiction
The bench comprising Rathod Kamalesh Jayantbhai ( Accountant Member ) and Sandeep Gosain ( Judicial Member ) held that “the sale consideration as determined/adopted by the Stamp Duty Authorities, has to be adopted for the purposes of computation of capital gain.Thus, the intention of the legislature is quite clear that after this amendment, it is always the Stamp Valuation to be considered and there is no warrant to replace such figure in view of such binding legal fiction. The subjected transaction between the seller and the assessee buyer firm, was in accordance with the prevailing DLC rates and the Stamp Duty Authority has duly accepted the declared consideration. Thus, Sec 50C of Income Tax Act directly and strongly supports the case of the assessee.
In a recent decision the chennai bench of the Income Tax Appellate Tribunal ( ITAT ) observed that sales of jewellery could not be treated as unexplained cash credit under Section 68 of Income Tax, Act, 1961
The corum of Mahavir Singh ( Vice President ) and Manjunatha G ( Accountant member ) considered view that the AO was erred in making additions towards cash receipts received for sale of jewellery, which has been subsequently converted into sales, for the impugned assessment year as unexplained cash credits taxable under Section 68 of the Income Tax Act, 1961
In a recent decision the Delhi bench of the Income Tax Appellate Tribunal ( ITAT ) observed that the amount of Tax Deducted at Source ( TDS ) can be reduced while calculating advance tax and interest under Section 234B of Income Tax Act, 1961, cannot be levied
The two member bench of the tribunal comprising Kul Bharat ( Judicial member ) and M.Balaganesh (Accountant member) observed that the payments made by HCLT to the assessee are not subject to taxation in India under domestic law. Consequently, the assessee is not required to pay advance tax, and therefore, no interest under Section 234B of the Income Tax Act, 961, can be imposed.
The Mumbai bench of the Income Tax Appellate Tribunal ( ITAT ) directed the Assessing Officer ( AO ) to delete the addition under Section 115JB of the Income Tax Act, 1961, citing incorrect inclusion of additional depreciation in the computation of book profit.
The two member bench of the tribunal comprising M.S. Pathmavathy ( Accountant member ) and Vikas Aswathy ( Judicial member ) uphold the contention raised by the assessee, and we instruct the AO to eliminate the addition made to the book profit computed under Section 115JB of the Income Tax Act, 1961, In the result, an appeal filed by the assessee was partly allowed.
The Ahmedabad bench of the Income Tax Appellate Tribunal ( ITAT ) has decided to delete the Income Tax addition, as it found that no deduction of Tax Deducted at source ( TDS ) under Section 194C of the Income Tax Act was required for land leveling expenses.
The two member bench of the tribunal comprising T.R. Senthil Kumar ( Judicial member ) and Waseem Ahmed ( Accountant member ) it can be inferred that the assessee was not subject to Section 44AB of the Income Tax Act, in the previous year, thus exempt from TDS deduction under Section 194C of the Income Tax Act , for land leveling expenses. Therefore, overturned the CIT(A)’s decision and instruct the AO to remove the addition made
The Ahmedabad bench of the Income Tax Appellate Tribunal ( ITAT ) has overturned the disallowance of donations for the Milan Mandir Building Fund under section 11(i)(d) of the Income Tax Act,1961, nullifying the addition made to the total income of the assessee due to discrepancies in income calculation
The single member bench of the tribunal comprising Suchithra Kamble ( Judicial member ) observed that donation received for the specific purpose i.e. Milan Mandir Building Fund and also invested for the said purpose/said fund as per the provisions of section 11(i)(d) r.w.s. 11(5) of the Income Tax Act, in the schedule bank for which the assessee has submitted the bank account therefore this aspect was not taken into consideration by the CIT (A).
The two member bench of the Income Tax Appellate Tribunal ( ITAT ) Delhi, upheld the deletion of addition under Section 68 of the Income Tax Act, 1961, confirming the personal identity of depositors.
The tribunal comprising C.N.Prasad ( Judicial member ) and Dr. B.R.R.Kumar ( Accountant member ) determined that the AO rejected the evidence provided by the appellant without proving the falsity of the documents submitted by the assessee. The personal identities of these investors were established, their sources were proven, and their ITRs and subsequent repayments were examined. After thorough examination, the CIT(A) concluded that the AO was unjustified in treating the unsecured loans received under Section 68 of the Income Tax Act, 1961.
In a recent decision the Income Tax Appellate Tribunal, ( ITAT ) in Mumbai, observed that income earned from letting out of auditorium was eligible for exemption under Section 11 of the Income Tax Act, 1961, when income was applied to objects of Trust
the two member bench of the tribunal comprising Kavitha Rajagopal ( Judicial member ) and there was merit in the contention that whether the impugned income was incidental to the objects of the assessee trust was a debatable issue and that the AO while allowing the exemption in the order passed under Section 144 r.w.s.263 of the Income Tax Act has taken a possible view upon verifying the details available on record. In view of above discussions and applying the ratio laid down by the Apex court in the case of Malabar Industrial Co. Ltd ( supra )
In a major ruling the Delhi bench of the Income Tax Appellate Tribunal ( ITAT ) observed that entire receipt of Indian rupee ( INR ) received from different entities not taxable as royalty.
The tribunal of Dr, B.R.R Kumar ( Accountant member ) and Kul Bharat ( Judicial member ) allowed the assessee’s claim by holding that the receipts in question could not be taxed as “royalty”. For the same reasons herein also we hold that the entire receipt of INR 119, 88, 54,215/- received from different India entities could not be taxed as royalty.
The Ahmedabad bench of the Income Tax Appellate Tribunal ( ITAT ) has decided to delete the penalty under Section 271(1) of the Income Tax Act, as it found no inaccuracies in the particulars furnished in the Income Tax Return.
The tribunal, of Suchithra Kamble observed that the Supreme Court in the case of Reliance Petro-Product Pvt. Ltd. clarified that “inaccurate particulars” refer to details in the return that are not precise or correct. As the Assessing Officer did not find any inaccuracies or false details supplied by the assessee, Section 271(1)(c) of the Income Tax Act, cannot be invoked. Moreover, the assessee provided detailed calculations during the assessment proceedings regarding interest on borrowed funds, which were subsequently added by the Assessing Officer.
The Mumbai bench of the Income Tax Appellate Tribunal ( ITAT ) upheld a penalty imposed under Section 271(1) (c) of the Income Tax Act, 1961, for failure to furnish proper Income Tax Return ( ITR ).
The coram of Kuldip Singh ( Judicial member ) and Om Prakash Kant ( Accountant member ) observed that failure to furnish returns, comply with notices, concealment of income, such person shall pay by way of penalty under Section 271(1)(c) of Income Tax Act, Since, both the penalty under Section 271(1) Income Tax Act, as well as penalty under Section 270A Income Tax Act, could be initiated if the Assessing Officer or other authority prescribed may consider so under the proceeding of the Act. Therefore, the issue decided by Allahabad High Court ( supra ) respectfully following the finding, the grounds raised by the assessee are dismissed.
In a significant ruling the Mumbai bench of the Income Tax Appellate Tribunal ( ITAT ) upheld the invocation of under Section 68 of the Income Tax Act, 1961, due to the failure to explain the amount found credited in the books.
The two member bench of the tribunal comprising Prashanth Maharishi ( Accountant member ) and Pavan Kumar Gadale ( Judicial member ) believed that the Commissioner of Income Tax ( Appeals ) [CIT (A)] had issued a well-founded and conclusive order. Therefore, the bench did not identify any shortcomings in the CIT (A)’s decision and upheld it accordingly.
The single member bench of the Income Tax Appellate Tribunal ( ITAT ), Hyderabad, directed the Assessing Officer (AO) to delete the addition of agricultural income, substantiating that the father’s gift to his son was supported by evidence.
The tribunal comprising K. Narasimha Chary (Judicial member) concluded that the matter was returned to the Assessing Officer’s jurisdiction for thorough examination of the evidence presented by the assessee concerning the Rs. 5 lakhs gifted by each grandfather.
The Kolkata bench of the Income Tax Appellate Tribunal ( ITAT ) has held that the trust cannot be barred from getting the benefit of income tax deduction because of not opted for it previously.
A two-member bench comprising of Shri Sanjay Garg, Judicial Member & Shri Girish Agrawal, Accountant Member viewed that taking the reasonable construction of the said provision, the assessee is well within the prescribed limitation period to apply for the final approval Under section 80G(5) of the Act.
The single member bench of the Income Tax Appellate Tribunal ( ITAT ) Ahmedabad, imposed a penalty under Section 275(1)(c) of the Income Tax Act, 1961, on loans taken from partnership firms, which were deemed to violate Section 269SS of the Income Tax Act, 1961
The tribunal comprising Suchithra Kamble observed that the assessee, who was both a gynecologist and a partner in M/s. Kalpana Hospital conducted this transaction in a personal capacity but portrayed it as a loan taken from the partnership firm. Hence, the decision relied upon by the assessee and Circular No. 387 dated 06-07-1984 issued by the CBDT are not applicable in the present case. Consequently, the appeal of the assessee was dismissed.
In a significant ruling the Delhi bench of the Income Tax Appellate Tribunal ( ITAT ) observed that the capital gain account scheme towards cost of improvement of residential property acquired was eligible for deduction under Section 54F of the Income Tax Act, 1961
The two member bench of the tribunal comprising Challaya Nagendra Prasad ( Judicial member ) and Pradip Kumar Kediya ( Accountant member ) observed that the assessee that the sum of Rs. 25 lakhs allocated and retained in the Capital Gain Account Scheme for the improvement of the acquired residential property qualifies for deduction under Section 54F of the Income Tax Act, 1961. This cost of improvement can, at most, be considered as deductible at the time of the eventual sale of the property. Therefore, the directive issued by the Principal Commissioner of Income Tax ( Pr.CIT ) regarding this matter remains unchallengeable.
In a recent decision the Mumbai bench of the Income Tax Appellate Tribunal ( ITAT ) ruled that the mere making of an incorrect claim does not tantamount to furnishing of inaccurate particular, leading to the deletion of penalty under Section 27(1)(c) of the Income Tax Act, 1961
The two member bench of the tribunal comprising S.Rifafur Rahman ( Accountant member) and Kavitha Rajagopal ( Judicial member) found no justification in the penalty levied by the lower authorities considering the factual aspect of the present case Therefore, the bench further deemed it fit to direct the A.O. to delete the impugned penalty levied. Hence, the grounds raised by the assessee are allowed.
In a major ruling the Mumbai bench of the Income Tax Appellate Tribunal ( ITAT ) allowed concessional rate of tax under Section 115BAA of the Income Tax Act, 1961, due to non-appearance resulting in the failure to file Form 10IC.
The ITAT concluded that the assessee’s assertion regarding the filing of Form 10IC requires factual verification, the bench returning the appeal to the CIT (A) to examine the assessee’s claim based on any evidence that may be submitted and to allow the claim in accordance with the law.
In a significant ruling the Delhi bench of the Income Tax Appellate Tribunal ( ITAT ) observed that non reply to Section 133(6) of the Income Tax Act, 1961, notice cannot necessarily lead to disallowance of petty expenses
The two member bench of the tribunal comprising Saktijit Dey ( Vice President ) and Dr. B.R.R Kumar ( Accountant member ) observed that the Assessing Officer (AO) erred in assuming that the non-response to Section 133(6) of the Income Tax Act, notices automatically warrants the disallowance of petty expenses ranging from Rs. 9,000 to Rs. 1,00,000. In the absence of any other evidence indicating the non-incurrence of these expenses, the mere lack of response to notices cannot justify their disallowance.
The two member bench of the Income Tax Appellate Tribunal ( ITAT ), Delhi, observed that no Tax Deducted at Source ( TDS ) deduction under Section 194J of the Income Tax Act, 1961, when consultancy charges excluding service tax does not exceed Rs. 30.000.
Hence, as per the provisions of Section 194J of the Income Tax Act, 1961, read with CBDT circular, the tribunal comprising Anubhav Sharma ( Judicial member ) M. Balaganesh ( Accountant member ) held that the assessee was not obligated to deduct tax at source. Hence, no disallowance under Section 40(a)(ia) of the Income Tax Act, 1961, could not be made. Accordingly In the result, the appeal of the assessee was allowed
The two member bench of the Income Tax Appellate Tribunal ( ITAT ) Mumbai, allowed the claim of deduction under Section 80-IC of the Income Tax Act, 1961, based on the Income Tax Return ( ITR ) filed along with Form 10CCB.
The two member bench of the tribunal comprising Prashanth Maharishi ( Accountant member ) and Sandeep Sing Karhail ( Judicial member ) observed that the fiscal year under review marks the 8th year of claiming the deduction under section 80-IC of the Income Tax Act, 1961, for the Rudrapur unit. Additionally, the assessee has provided a copy of Form No. 10CCB dated 29/11/2015, supporting their claim for deduction under Section 80-IC of the Income Tax Act, 1961.
The Mumbai bench of the Income Tax Appellate Tribunal ( ITAT ) observed that decision of Commissioner of Income Tax ( Appeals ) [ CIT (A) ] without considering merits of case was violative of provisions of Section 250(6) of the Income Tax Act, 1961
The two member bench of the tribunal comprising Rahul Choudari ( Judicial member ) and Prashant Maharishi ( Accountant member ) observed that the order of the CIT-A does not align with the provisions of Section 250(6) of the Income Tax Act, 1961, particularly given that a specific ground concerning the addition of Rs. 14,098,500 was raised in the appeal. In the interest of natural justice, the appeal of the assessee was reinstated to the CIT-A with the directive that once the window for submission of detailed information was available, the assessee must comply within the prescribed time frame.
The Chennai bench Income Tax Appellate Tribunal ( ITAT ), rejected the assessment order under Section 143(3) of the Income Tax Act, 1961, due to oversight and typographical error, as the satisfaction note was not provided.
The two member bench of the tribunal comprising Manoj Kumar Agarwal ( Accountant member ) and V. Durga Rao ( Judicial member ) observed that the remand report from the Assessing Officer refuted the objections raised by the assessee concerning the satisfaction note’s receipt and the typographical error in the order.
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