This weekly round-up analytically summarizes the key stories related to the Authority of Income Tax Appellate Tribunal (ITAT) reported at Taxscan.in during the previous week from December 19 to December 26, 2021.
DCIT Vs. M/s. Gorakhpur Infrastructure Co. Ltd.
The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) deleted the disallowance made on account of depreciation on the right to collect annuity on toll roads. The coram Judicial Member, Amarjit Singh, and Accountant Member, M. Balaganesh held that the assessee was awarded the work of constructing a part of the National Highway no.5, under BOT basis. Therefore, the entire investment/finance for developing the infrastructure facility was borne by the assessee. By making such an investment what the assessee received in return was a right to collect annuity over the period of concession. Thus, the investment made by the assessee for acquiring such right certainly is an intangible asset coming within the purview of section 32(1)(ii) of the Act. Therefore, the assessee would be eligible to claim depreciation.
Green Orchard Farm Houses Vs. DCIT
The Income Tax Appellate Tribunal (ITAT), Bangalore bench, while deleting an assessment order held that the omission to serve a notice under section 143(2) of the Income Tax Act, 1961 is not a curable defect for the purpose of applying the provisions of section 292BB of the Act.
Moonfrog Labs Pvt. Ltd Vs. ACIT
The Bangalore bench of the Income Tax Appellate Tribunal (ITAT) has held that the payments made for advertising through Facebook and other digital advertising companies shall not be subject to TDS under section 195 of the Income Tax Act, 1961 since the same is not in the nature of “royalty” as per the double taxation avoidance agreement (DTAA).
M/s. Infobells Interactive Solutions Vs. DCIT
The Bangalore Bench of Income Tax Appellate Tribunal (ITAT) held that the assessee was entitled to the deduction of employees’ contribution of PF, and ESI as the contribution made was prior to the due date of final return.
In a major relief to Senior Advocate Harish Salve, the Delhi Bench of Income Tax Appellate Tribunal (ITAT) allowed the credit of Taxes paid on Overseas Income. “We are of the view that the credit of the taxes paid on such income deserves to be allowed. We, therefore, restore the issue back to the file of AO and direct him to allow the credit of the foreign taxes paid as claimed by the assessee u/s 90 of the Act as per the provision of Act and in accordance with the law. Needless to state that AO shall grant adequate opportunity of hearing to the assessee. Assessee is also directed to promptly furnish all the details called for by the AO,” the tribunal while allowing the appeal said.
In a major relief to Nokia India, the Delhi Bench of Income Tax Appellate Tribunal (ITAT) deleted the disallowance worth Rs. 41.6 Crores. The Coram of Accountant Member, R.K.Panda and Judicial Member, Kul Bharat found that this issue is also squarely covered in favour of the assessee by the decision of the Coordinate Bench of the Tribunal in assessee’s own case vide ITA No.1883/Del/2017 for Assessment Year 2011-12 and also in ITA No. 6501/Del/2017 for Assessment Year 2012-13. Respectfully following the order of the Tribunal for Assessment Year 2011-12 and 2012-13 so deleted the disallowance.
Vinko Auto Industries Vs. DCIT
The Amritsar Bench of Income Tax Appellate Tribunal (ITAT) held that the assessee to claim a deduction of employee’s share of ESI & PF if deposited prior to ITR filing. The coram headed by the Vice President N.K.Saini and Judicial Member, N.K.Choudhary held that there are a plethora of judgments in favour of the Assessee’s contention and of the Revenue. The controversy with regard to divergent views of different High Courts has been settled by the Hon’ble Apex Court in the case of CIT VS. M/s. Vegetables Products Ltd. (88 ITR 192) by laying the dictum that if two reasonable constructions of a taxing provision are possible that construction which favours the Assessee must be adopted.
Paradise Rubber Industries Vs. PCIT The Amritsar Bench of Income Tax Appellate Tribunal (ITAT) held that the revisionary Power of PCIT cannot be invoked as AO had scrupulously discharged the duty.
