This weekly summary analyses the major Income Tax Appellate Tribunal (ITAT) stories that have been published at Taxscan.in. during the previous week from June 24 to 30, 2023.
The Bangalore bench of the Income Tax Appellate Tribunal (ITAT) quashed the assessment order passed by the assessing officer for calculating the tax amount for the pre-clinical laboratory services rendered by the non-resident to the customers in India.
The two-member panel comprising Chandra Poojari (Accountant) and Beena Pillai (Judicial) held that the pre-clinical laboratory services rendered by a non-resident to customers in India would not be taxable in India and the assessment order made by the assessing officer was not as per the law and are liable to be quashed while allowing the appeal filed by the assessee.
The Ahmedabad Bench of Income Tax Appellate Tribunal (ITAT) has held that the credits to capital account shown as gift from assessee’s aunt are not unexplained credits. Therefore, the bench deleted the addition made by the lower authorities.
The two-members bench of Annapurna Gupta ( Accountant Member) and Madhumita Roy (Judicial Member) after considering the submissions of the both parties observed that the credit is from maturity of old FDRs made by his aunt who was taken care of by the assessee only in the absence of her relative staying abroad Therefore the bench allowed the appeal filed by the assessee.
The Ahmedabad Bench of Income Tax Appellate Tribunal (ITAT) has quashed reassessment order passed without issuing notice under Section 148 of Income Tax Act, 1961.
The single member bench of Chandra Mohan Garg (Judicial Member), after considering the submissions of the both parties observed that the assessment order under section 143(3)/147 of the Income Tax Act is not validly sustainable in the absence of a valid notice under section 148 of the Income Tax Act by the Assessing Officer having jurisdiction over the assessee. Therefore the same was deserved to be quashed being bad in law. Thus, the bench allowed the appeal filed by the assessee.
The Mumbai bench of Income Tax Appellate Tribunal (ITAT) has recently held that deduction for revenue from onsite services could not be denied on the ground of not connected to eligible units located in India.
The two member bench of B.R. Baskaran, (Accountant Member) Rahul Chaudhary, (Judicial Member) held that for the Assessment Year 2009-10 deduction claimed by the assessee under Section 10A of the Income Tax Act in respect of revenue from onsite services could not be denied on the ground that the onsite services are not connected to the eligible units located in India.
The Raipur bench of the Income Tax Appellate Tribunal (ITAT) held that the mistakes that are apparent from the records under Section 254(2) of the Income Tax Act, 1961 can be rectified by the tribunal.
The two-bench member comprising of Ravish Sood (Judicial member) and Dipak P. Ripote (Accountant member) concluded that the orders passed while disposing off the respective appeals as suffering from a mistake, which being apparent from record had therein made those amenable for rectification under sub-section (2) to Section 254 of the Income Tax Act, 1961. The orders which were filed by the department and were passed by the tribunal while disposing off the appeals were recalled.
The Chandigarh bench of the Income Tax Appellate Tribunal (ITAT) directed the assessing officer to re-adjudicate the rejection of a claim of loss against the surrendered business income as unexplained income.
The bench observed that the action of the lower authorities in denying the set off of losses to the assessee cannot be held to be justified and are liable to be deleted. A single-member bench comprising Sanjay Garg ( Judicial) directed the assessing officer to re-adjudicate for allowing the claim of set-off of losses in respect of income determined under section 115BBE of the Income Tax Act while allowing the appeal filed by the assessee.
The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has held that additional income tax pay by domestic companies to resident shareholders should be at the rate mentioned under Section 115-O of the Income Tax Act, 1961.
The two member bench of Amit Shukla, (Judicial Member) and Amarjit Singh, (Accountant Member)held that dividend distribution tax is not on the shareholder but a tax on the domestic company. Therefore, the bench dismissed the appeal filed by the assesee.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has allowed depreciation claims under Section 32 of the Income Tax Act, 1961 holding that the term used for the Purpose of business would include assets which had been kept ready for use but actually had not been put to use.
The Bench further relying upon the decision in National Thermal Power Corporation Ltd. vs. Commissioner of Income-tax which held that ‘used for the purposes of the business’ would include the asset which is kept ready for use but actually not put to use, allowing the appeal filed by the assessee.
The Ahmedabad bench of the Income Tax Appellate Tribunal (ITAT) held that Deemed Income under Section 11(3) of the Income Tax Act, 1961 can’t be claimed as an exemption under Section 11(1)(a) and Section 11(2) of the Income Tax Act.
The two-bench member comprising of Annapurna Gupta (Accountant member) and Siddhartha Nautiyal (Judicial member) directed the Assessing Officer (AO) to re-compute the exemption available to the assessee under Section 11(1)(a) and Section 11(2) of the Act by excluding “deemed income” under Section 11(3) of the Income Tax Act, 1961. And the appeal of the assessee is dismissed.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has held that the Assessing Officer (AO) could not withdraw or modify or substitute assessment order passed under Section 143(3) of the Income Tax Act, 1961 with another assessment order.
The two-member Bench of G.S. Pannu (President) and Saktijit Dey, (Judicial Member) observed that as per the scheme of the Act, once an assessment order had been passed under Section 143(3) of the Income Tax Act in respect of any assessment year, the Assessing Officer could not tinker with that assessment. He could either reopen the assessment or rectify the assessment order after strictly complying with the conditions of section 147 and 154 of the Income Tax Act respectively. The Bench allowed the appeal holding that the statute had not conferred any powers on the Assessing Officer to either withdraw or modify or substitute the assessment order passed under Section 143(3) of the Income Tax Act with another assessment order.
The Mumbai bench of Income Tax Appellate Tribunal (ITAT) has recently held that telecommunication charges incurred for delivery of computer software outside India should be excluded from export turnover for computing deduction under Section 10A of Income Tax Act,1961. Therefore, the bench remanded the issue to the file of the Assessing Officer.
The two member bench of B.R. Baskaran (Accountant Member) Rahul Chaudhary (Judicial Member) remanded the issue to the file of the Assessing Officer to identify and excluded from “Export Turnover” the expenses incurred in foreign exchange which are connected to providing services of software development outside India for the purpose of computing deduction under Section 10A of the Act.
The Hyderabad bench of the Income Tax Appellate Tribunal (ITAT) held that a penalty can’t be imposed under Section 271D of the Income Tax Act, 1961 if there is no satisfaction in the assessment order.
The two-bench member comprising of R.K. Panda (Accountant member) and Laliet Kumar (Judicial member) held that since there is no recording of satisfaction by the Assessing Officer (AO) in the body of the assessment order for initiating penalty proceedings under Section 271D of the Income Tax Act. In reference to the decision of the jurisdictional High Court in the case of Srinivas Reddy Reddeppagari vs. Jt. CIT the penalty levied by the Assessing Officer (AO) and sustained by the Commissioner of Income-tax (Appeals) [CIT (A)] is liable to be quashed.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) held that the services rendered under IT & SAP service agreement are different from technical collaboration agreement. Thus the receipt of IT & SAP service is not treated as Fees for Technical service (FTS) under India-Israel Double Taxation Avoidance Agreement (DTAA).
The ITAT Bench comprising of Shri G.S. Pannu, President and Shri Saktijit Dey, Judicial Member observed that to qualify FTS under Article 12(4)(a) of India – Portugal Tax Treaty therein, two conditions have to be satisfied. Firstly, the services giving rise to the fees must be ancillary and subsidiary, and secondly, it must be connected to the application or enjoyment of right, property, or information which results in payment of royalty.
The Tribunal noted that IT and SAP support service agreement are completely different in nature and have no connection with the services rendered under the Technical Collaboration Agreement. Thus, the bench concluded that the IT and SAP Service receipts cannot be treated as FTS under Article 12(4)(a) of India – Portugal DTAA.
The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has held that no deduction should be allowed if payment of employee contribution towards Provident Fund (PF) and Employee State Insurance (ESI) is not made due date as per PF and ESI Act .
The two member bench of Vikas Awasthy (Judicial Member) and S. Rifaur Rahman, (Accountant Member) observed that the auditor in the audit report specifies the due date as prescribed under Section 36(1)(va) of the Income Tax Act and the date on which deposit has been made, then in the computation of income, the same cannot be claimed as deduction, because the law envisages that such payment is disallowable, because it has not been paid within the due date.
The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has held that the additional income tax on dividends paid domestic companies to non-resident shareholders should be at rate prescribed under Section 115-O of Income Tax Act, 1961and not as per Double Taxation Avoidance Agreement (DTAA).
The two-member Bench of B R Baskaran, (Accountant Member) and Kuldip Singh, (Judicial Member) referred to Total Oil India Pvt. Ltd. vs. CIT & ors. which held that “Where dividend is declared, distributed or paid by a domestic company to a non-resident shareholder(s), which attracts Additional Income Tax (Tax on Distributed Profits) referred to in Sec.115-O of the Act, such additional income tax payable by the domestic company shall be at the rate mentioned in Section 115 O of the Act and not at the rate of tax applicable to the non-resident shareholder(s) as specified in the relevant DTAA with reference to such dividend income.” The Bench dismissed the cross objection filed by the assessee.
The Chennai Bench of Income Tax Appellate Tribunal (ITAT) while confirming the disallowance of payment of agency commission held that the assessee failed to justify the service render to Associated Enterprise.
the two member bench of Mahavir Singh, (Vice President) And Manjunatha.G, (Accountant Member) considering above observation held that assessee could not file any evidence to prove that AEs have rendered services to justify payment of agency commission.
The Pune Bench of Income Tax Appellate Tribunal (ITAT) has quashed disallowance of payment made to subcontractors workers on basis of admissions or confessions made during survey proceedings .
The two member bench of Satbeer Singh Godara (Judicial Member) and Dr. Dipak P. Ripote, (Accountant Member) held that once the departmental survey action even could not find anything specific against the assessee or his sub-contracts despite having the benefit of Section 292C of the Income Tax Act. Therefore, the bench allowed the appeal filed by the assessee.
The Chandigarh Bench of Income Tax Appellate Tribunal (ITAT) held that set-off of any loss or deduction of any expenditure of business income, prior to Assessment Year (AY) 2016-17 cannot be denied under Section 115BBE of Income Tax Act, 1961.
The Single Bench of SH. Sanjay Garg, Judicial Member observed that in this case the assessment year involved is A.Y. 2013-14 and that the amendment to the provisions of Section 115BBE of Income Tax Act have been introduced vide Finance Act, 2016 w.e.f. 01.04.2017, the action of the lower authorities in denying the set off of losses to the assessee cannot be held to be justified. Hence, the Tribunal allowed the appeal and directed the AO to allow the assessee set off of losses in respect of income determined under Section 115BBE of the Income Tax Act.
The Amritsar bench of the Income Tax Appellate Tribunal ( ITAT) quashed the assessment order passed by the assessing officer by quoting the wrong section on jurisdiction and declared the order as void ab-initio.
The two-member bench comprising Dr. M. L. Meena ( Accountant) and Anikesh Banerjee (Judicial) held that the assessment framed under section 153A of the Income Tax Act was a mistake of quoting a wrong section on jurisdiction and defect of mentioning a wrong section on jurisdiction by the assessing officer was not a curable mistake or defect under section 292B of the Income Tax Act and declared as void ab initio while allowing the appeal filed by the assessee.
The Income Tax Appellate Tribunal (ITAT), Mumbai bench has held that the investment in the Unit Linked Insurance Policy (ULIP) of Life Insurance Corporation of India (LIC) shall be treated as a “Capital Asset” under Section 2(14) of the Income Tax Act, 1961 and the accretion on surrender of the policy shall be taxable under the head “Income from Capital Gains” and not under “Income from Other Sources”.
The two-member bench comprising of Shri Prashant Maharishi (Accountant Member) and Ms Kavitha Rajagopal (Judicial Member) held that ULIP shall come under the purview of ‘capital asset’ as per section 2(14) of the Income Tax Act, 1961 and directed the AO to tax the accretion on surrender of the policy under the head ‘income from capital gains’ instead of ‘income from other sources.’ In result, the bench allowed the appeal filed by the assessee.
The Chandigarh bench of the Income Tax Appellate Tribunal (ITAT) held that Non-mentioning of the business income in the books of account cannot be the sole reason to invoke the provisions of Section 115BBE of the Income Tax Act, 1961.
The one-bench member comprised of Sanjay Garg (Judicial member) made the view that the additional income surrendered by the assessee was not from any other unexplained source and same was out-of-business proceeds of the assessee. Therefore, on the part of the lower authorities in applying the provisions of Section 115BBE of the Income Tax Act to the surrendered business income of the assessee was not justified. The Assessing Officer was redirected to tax the assessee on the surrendered income at normal rates as applicable to the business income. The appeal of the assessee was allowed.
The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has held that the additional income tax on dividends paid by domestic companies to non-resident shareholders should be at rate prescribed under Section 115-O of Income Tax Act, 1961and not as per Double Taxation Avoidance Agreement (DTAA).
The two-member Bench of B R Baskaran, (Accountant Member) and Kuldip Singh, (Judicial Member) referred to Total Oil India Pvt. Ltd. vs. CIT & ors. which held that “Where dividend is declared, distributed or paid by a domestic company to a non-resident shareholder(s), which attracts Additional Income Tax (Tax on Distributed Profits) referred to in Sec.115-O of the Act, such additional income tax payable by the domestic company shall be at the rate mentioned in Section 115 O of the Act and not at the rate of tax applicable to the non-resident shareholder(s) as specified in the relevant DTAA with reference to such dividend income.” The Bench dismissed the cross objection filed by the assessee.
The Pune bench of Income Tax Appellate Tribunal (ITAT) has held that share capital credited through the journal entries are not unexplained share capital. The bench upheld the deletion of addition made under Section 68 of Income Tax Act, 1961.
The two member bench of R.S. Syal, (Vice President) and Partha Sarathi Chaudhury, (Judicial Member) allowed the appeal filed by the assessee and observed that transfer to share capital account was only by means of transfer entries, which, obviously, could not lead to addition under Section 68 of the Income Tax Act. Keyur Patel, counsel appeared for the revenue. Jayant Pendse, counsel appeared for the assessee.
The Visakhapatnam bench of the Income Tax Appellate Tribunal( ITAT) quashed the assessment order passed by the assessing officer for non-issuance of proper notice under section 148 of the Income Tax Act,1961.
The bench observed that the revenue had failed to establish that there was proper service of notice under sections 147 / 148 of the Income Tax Act before passing the assessment order. A single-member bench comprising Duvvuru Rl Reddy ( Judicial) held that the assessment order passed by the assessing officer was not as per the law and is liable to be quashed while allowing the appeal filed by the assessee.
The Pune bench of Income Tax Appellate Tribunal (ITAT) has held that engineering and development costs incurred for manufacture and sale of seats for passenger cars are revenue expenditure.
The Tribunal found that it is a case of payment in the nature of royalty for the use of such Technology, being an item of revenue nature After considering the facts the two member bench of R.S. Syal (Vice President) and Partha Sarathi Chaudhury (Judicial Member) allowed the appeal filed by the assessee and deleted the disallowance made by the assessing officer. Keyur Patel appeared for the revenue and Dhanesh Bafna appeared for the assessee.
The Jaipur bench of Income Tax Appellate Tribunal (ITAT) has held that deduction under Section 54 F Income Tax Act, 1961 should not be denied by reason of sale amount not deposited in Capital Gain Account.
The bench determined that the assessee has invested the entire actual sales consideration received by him in the purchase and construction of new house in accordance with the provision of section 54F(1) Income Tax Act thereafter the provision of section 50C Income Tax Act has not been applicable . After considering the facts, a single member bench of Sandeep Gosain, (Judicial Member) allowed the appeal filed by the assessee. Monisha Choudhary , counsel appeared for the revenue. Mahendra Gargieya, counsel appeared for the assessee.
The Mumbai bench of the Income Tax Appellate Tribunal ( ITAT) upheld the addition made by the assessing officer to the business income of invalid purchases on the ground of the nonsubmission of necessary documents during assessment proceedings.
The two-member panel comprising Kuldip Singh (Judicial) and Gagan Goyal (Accountant) held that the addition made by the assessing officer of bogus purchase was as per the law and sustainable while dismissing the appeal filed by the assessee.
The Chandigarh Income Tax Appellate Tribunal (ITAT) held that the trust activities of sale of plots, flats and commercial booths and also its income earned form non construction fee, transfer fee, penal interest and compounding fees are charitable in nature and thus allowed exemption under Section 11 of the Income Tax Act,1961.
The Bench comprising of Shri A.D. Jain, Vice President and Shri Vikram Singh Yadav, Accountant Member held that the second proviso to Sections 2 (15) and 13 (8) of the Income Tax Act are not applicable to this case, and so, the aggregate receipts of the assessee trust from its activities of sale of plots, flats and commercial booths and also its income earned form non-construction fee, transfer fee, penal interest and compounding fee, etc., are held to be entitled for exemption under Section 11 of the Income Tax Act.
The Chandigarh bench of the Income Tax Appellate Tribunal ( ITAT) held that the additional income which was not derived from the unexplained sources should be taxable at normal tax rates as same as that of the business income.
A single-member bench comprising Sanjay Garg (Judicial) directed the assessing officer to re-adjudicate the matter for the calculation of tax amount on the surrendered income of the assessee at normal rates as applicable to the business income 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 rejection of the claim for deduction of loss on sale of shares due to invalid filing of revised return of income(ROI).
The two-member bench comprising Inturi Rama Rao (Accountant) and S. S. Viswanethra Ravi (Judicial) held that the assessing officer had to re-examine the validity of the revised return of income filed by the assessee company for claiming the loss arising on the sale of shares while allowing the appeal filed by the assessee.
The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has upheld the disallowance as the fee paid for late filing of professional tax return was penal in nature.
The two-member Bench of Prashant Maharishi, (Accountant Member) and Kuldip Singh, (Judicial Member) upheld the disallowance made by the Commissioner of Income Tax Appeals (CIT(A)) and set aside the impugned order. The Bench observed that it was an accepted notion that the penalty or fine levied on the assessee was allowed as expenditure under provisions of Section 37(1) of the Income Tax Act only on the basis of their nature, whether such fine or penalty was of compensatory nature or penal nature, here the fee was penal in nature and liable to be disallowed.
The New Delhi bench of the Income Tax Appellate Tribunal ( ITAT) directed the assessing officer to re-adjudicate the rejection of registration under section 12AA of the Income Tax Act,1961 due to the non-falling of the trust within the ambit of ‘charitable purpose’.
The two-member bench comprising C.M. Garg (Judicial) and M. Balaganesh (Accountant) directed the assessing officer to re-adjudicate the matter to grant registration under section 12AA of the Income Tax Act to the assessee trust 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 made on the ground of non deposition of Tax Deducted at Source (TDS) in the books of account.
The two-member panel comprising C.M. Garg (Judicial ) and M. Balaganesh (Accountant) directed the assessing officer to re-adjudicate the matter by applying the second proviso to section 201(1) of the Income Tax Act which had been held to be retrospective in operation while allowing the appeal filed by the assessee.
The Indore bench of the Income Tax Appellate Tribunal (ITAT) directed the assessing officer to re-adjudicate the assessment order passed without giving the sufficient opportunity of hearing to the assessee.
The two-member bench comprising Vijay Pal Rao ( Judicial) and B.M. Biyani ( Accountant) directed the assessing officer to re-adjudicate the matter by giving sufficient opportunity to the assessee for presenting his case while allowing the appeal filed by the assessee.
The Indore bench of the Income Tax Appellate Tribunal (ITAT) directed the assessing officer to re-adjudicate the disallowance made on the ground of utilization of expenses for personal use or nonbusiness purposes.
The two-member bench comprising Vijay Pal Rao ( Judicial ) and B.M. Biyani ( Accountant) directed the assessing officer to delete the entire disallowance made by the authorities while allowing the appeal filed by the assessee.
The New Delhi bench of the Income Tax Appellate Tribunal (ITAT) held that no addition can be made on any unaccounted share capital when it was already taxed under the category of ‘source of income’.
The two-member bench comprising N.K.Billaiya (Accountant) and Anubhav Sharma (Judicial) directed the adjudicating authorities to re-adjudicate the matter while allowing the appeal filed by the revenue.
The New Delhi bench of the Income Tax Appellate Tribunal (ITAT) directed the assessing officer to delete the interest charged under section 201(1A) of the Income Tax Act,1961 on the ground of delay in remittance of Tax Deducted at source (TDS).
The two-member bench comprising C.M. Garg (Judicial) and M. Balaganesh (Accountant) held that the reason stated by the assessee was not false and the changeability of interest under section 201(1A) of the Income Tax Act, as rightly pointed out by the revenue was automatic, still the same cannot be levied on the assessee in the peculiar facts and circumstances of the instant case, as the interest liability had been fastened on the assessee for reasons beyond the control of the assessee. The bench also directed the assessing officer to delete the interest charged under section 201(1A) of the Income Tax Act for the alleged default while allowing the appeal filed by the assessee.
The Kolkata bench of the Income Tax Appellate Tribunal (ITAT) deleted the additions made on the interest receipt without having jurisdiction by the Commissioner of Income Tax (Appeals) [(CIT(A)].
The two members of Rajpal Yadav, (Vice-President) and Rajesh Kumar (Accountant Member)allowed the appeal of the assessee and deleted the addition made by the CPC. Ranu Biswas appeared for the revenue. Abhishek Bansal appeared for the assessee.
The Pune bench of Income Tax Appellate Tribunal (ITAT) has held that assessment order passed without Document Identification Number (DIN) is violation of Central Board Direct Tax (CBDT) circular 2019. Therefore, the bench declared the order void ab initio.
The two members of Rajpal Yadav, (Vice-President) and Rajesh Kumar, (Accountant Member)observed that the assessment order bears no DIN in the body of the assessment. Thus, the order undisputedly was communicated in violation of Para-2 of CBDT Circular. Further, the Revenue failed to bring on record any material showcasing that the case of the assessee falls within any of the five exceptional circumstances provided in Para-3 and accompanying therewith further evidentiary documents establishing the regularisation of initial manual issuance in terms Para-5 thereof. The Counsel Prashant Gadekar appeared for the revenue and Percy Pardiwalla appeared for the assessee.
The Lucknow bench of Income Tax Appellate Tribunal (ITAT) has held that cash deposited through bank accounts of companies during the demonetisation period are not unexplained cash.
The two members of Sudhanshu Srivastava, (Judicial Member) and Shri Anadee Nath Misshra, (Accountant Member) restored the issue to the file of the respective Assessing Officers with the direction to pass de nono orders in accordance with law, after providing reasonable opportunities to the respective assessees and after due verification of facts and circumstances.
The Bangalore bench of the Income Tax Appellate Tribunal ( ITAT) held that no audit can be made under section 44AB of the Income Tax Act,1961 when the assessee has not been maintained the books of account.
The two-member bench comprising Chandra Poojari (Accountant) and Beena Pillai (Judicial) held that if the assessee has not maintained the books of accounts, the penalty proceedings cannot be initiated under section 271A of the Income Tax Act. Additionally, the bench held that the penalty imposed by the assessing officer was not as per the law and is liable to be deleted while allowing the appeal filed by the assessee.
The Bangalore Bench of Income Tax Appellate Tribunal (ITAT) has directed re-adjudication of 85% accumulation claim disallowed by the Assessing Officer (AO) on the ground of no specific purpose for which such accumulation was mentioned in Form 10.
The two member bench of Chandra Poojari (Accountant Member) and George George K (Judicial Member) restored the matter to the file of CIT(A) for readjudication.
The Bangalore bench of the Income Tax Appellate Tribunal (ITAT) deleted the penalty imposed under section 272A(1)(d) of the Income Tax Act,1961 without giving proper opportunity to the assessee to prove the reason by the assessing officer.
The two-member panel comprising Chandra Poojari (Accountant) and Beena Pillai, Judicial held that the assessee was not guilty of apparent conduct to comply with the notice under section 142(1) of the Income Tax Act and thus it was not a fit case for levy of penalty under section 272A(1)(d) of the Income Tax Act and are liable to be deleted while allowing the appeal filed by the assessee.
The Ahemdabad bench of Income Tax Appellate Tribunal (ITAT) held that the onus on the assessee of proving the genuineness of long term capital gains not being bogus is not discharged by merely filing documentary evidence and hence confirms the addition made on account of bogus long term capital gains under Section 68 of Income Tax Act,1961.
The bench stated that holding the burden in the said cases where the facts showed phenomenal and fanciful rise in shares in a short span of time and thereafter steep fall, all unsupported by the financials of the companies, was heavy and could not be said to be discharged by filing mere documentary evidences of sale and purchase of shares. The Tribunal confirmed the order of CIT(A) and allowed the addition under Section 68 of Income Tax Act made on account of bogus long term capital gains claimed by the assessee.
The Surat Bench of Income Tax Appellate Tribunal (ITAT) has held that the Internet subscription expenses incurred for members of housing society are not eligible for deduction under Section 57 of Income Tax Act, 1961.
The single member bench of Pawan Singh, (Judicial Member ) observed that under Section 57 of Income Tax Act deduction is to be made in respect of expenditure incurred solely for the purpose earning such income, provided the expenditure is not capital expenditure or personal in nature. Therefore, the bench dismissed the appeal filed by the assessee
The Cochin Bench of the Income Tax Appellate Tribunal (ITAT) has ruled that the imposition of late fees under section 234E of the Income Tax Act of 1961 should not apply to cases where the filing of Tax Deducted at Source (TDS) or Tax Collected at Source (TCS) returns was not done prior to the amendment of Section 200A of the Income Tax Act.
The two member bench of Sanjay Arora (Accountant Member ) and Aby T. Varkey (Judicial Member) deleted the levy of late ‘fee’ under Section 234E of the Income Tax Act being of Quarter-2 and Quarter-4 of the assessment year 2013-14 being prior to 01.06.2015.
The Cochin Bench of Income Tax Appellate Tribunal (ITAT) has held that the Co-operative department auditor failed to furnish audit report of account within the specified date under section 44AB of Income Tax Act, 1961.
The two member bench of Sanjay Arora (Accountant Member ) and Aby T. Varkey (Judicial Member) observed the assessee has not been able to give any ‘reasonable cause’ for not levying a penalty under Section 271B of the Income Tax Act for failure to audit its account.
The Bangalore Bench of Income Tax Appellate Tribunal (ITAT) held that, a delay of 10 days in filing return cannot vitiate the Foreign Tax Credit (FTC) claimed to the extent of income earned outside India hence restored the matter to Assessing Officer (AO) for de novo consideration.
The Tribunal clarified that if the assessee had earned salary income outside India and declared it for taxation in India, then the assessee would be eligible to claim Foreign Tax Credit (FTC) for that portion. However, since there is no clear information available in the records regarding whether the entire salary income was earned in India or outside India, further investigation is required to determine the extent of FTC entitlement. Therefore,the ITAT bench restored the matter to the file of the AO for denovo consideration and directed the assessee to file the necessary evidences / documents to prove its case to the extent of FTC credit claimed.
The Chandigarh Bench of Income Tax Appellate Tribunal (ITAT) held that non compliance to the order of Commissioner of Income Tax (Appeals) [CIT (A)] during the entire proceedings cannot be the sole reason to allow addition on income tax return filed. Consequently, the ITAT overturned the previous order and reinstated it for a fresh assessment.
The ITAT Bench comprising of Sudhanshu Srivastava , Judicial Member and Vikram Singh Yadav, Accountant Member observed that the CIT(A) has passed the ex-parte order as according to it, the assessee was non-compliant during the whole proceedings before it, therefore one more opportunity should be given to the assessee to protect the interest of justice as the CIT(A) has not decided the appeal on merits.
Therefore, the Tribunal overturned the decision made by the Commissioner of Income Tax (Appeals) [CIT (A)] and returned the appeal back to the CIT (A) with instructions to reevaluate the case, granting the assessee a fair and ample opportunity to present their arguments. The Tribunal also instructed the assessee to cooperate fully throughout the proceedings.
The Chandigarh bench of the Income Tax Appellate Tribunal (ITAT) held that the loss incurred by embezzlement is an admissible deduction.
The two-bench member comprising of Sudhanshu Srivastava (Judicial member) and Vikram Singh Yadav (Accountant member) affirmed the order of the Commissioner of Income Tax (Appeals) and dismissed the ground by the Department. Therefore, the appeal of the assessee stands partly allowed and the appeal of the Department stands dismissed.
The Bangalore bench of the Income Tax Appellate Tribunal (ITAT) directed the assessing officer to re-adjudicate the rejection of a claim on loss of sale of discarded assets due to invalid filing of Income Tax Returns.
The two-member bench comprising Chandra Poojari (Accountant) and Beena Pillai (Judicial) directed the Commissioner of Income Tax (Appeals) to re-adjudicate the matter on merit after giving the opportunity of hearing to the assessee while allowing the appeal filed by the assessee.
The Bangalore bench of the Income Tax Appellate Tribunal (ITAT) directed the assessing officer to re-adjudicate the addition made on the ground of non-reply of notice issued during the assessment proceedings.
The two-member bench comprising Chandra Poojari (Accountant) and Beena Pillai ( Judicial) held that the assessing officer did not give sufficient opportunity to prove the reason of the assessee during the assessment proceedings. Additionally, the bench directed the assessing officer to re-adjudicate the matter to pass an order after giving the opportunity of hearing to the assessee while allowing the appeal filed by the assessee.
The Ahmedabad bench of the Income Tax Appellate Tribunal (ITAT) deleted the penalty imposed by the assessing officer under section 271(1)(c) of the Income Tax Act,1961 on the ground of concealment of income in return of income (ROI).
A single-member bench comprising Suchitra Kamble (Judicial) held that the penalty imposed by the assessing officer for the concealment of income or inaccurate particulars of income under section 271(1)(c) of the Income Tax Act was not as per the law and are liable to be deleted while allowing the appeal filed by the assessee.
The Income Tax Appellate Tribunal (ITAT) Delhi Bench upheld the disallowance of belated payment of employees’ contribution to provident fund and ESIC.
The two-member bench comprising Chandra Mohan Garg (Judicial Member) and Pradip Kumar Kedia (Accountant Member) affirmed the disallowance of employees’ contributions to Provident Fund/ESIC under Section 36(i)(va) in conjunction with Section 43B of the Income Tax Act.
The Bangalore bench of the Income Tax Appellate Tribunal (ITAT) directed the assessing officer to re-adjudicate the rejection of the claim of deduction under section 80-IA of the Income Tax Act,1961 due to delay in filing the Income Tax Returns.
The two-member bench comprising Chandra Poojari (Accountant) and George George K (Judicial) directed the assessing officer to re-adjudicate the matter for allowing the claim of deduction under section 80-IA of the Income Tax Act while allowing the appeal filed by the assessee.
The Kolkata bench of Income Tax Appellate Tribunal (ITAT) held that Income received from the unexplained cash under Section 68 of the Income Tax, 1961 Act can’t be claimed as an exemption under Section 69C of the Income Tax Act, 1961.
The two-member bench consisting of Rajpal Yadav (Vice President) and Girish Agrawal (Accountant Member) concluded that the Revenue Authorities were justified in rejecting the assessee’s claim and making the necessary additions. As a result, the appeal filed by the assessee was dismissed.
The Chandigarh Bench of the Income Tax Appellate Tribunal (ITAT) has deleted the disallowance made under Section 80P of the Income Tax Act, 1961 on failure to file return of income in due date prior to amendment of section 143(1)(a)(v) of the Income Tax Act.
The two-member bench comprising A.D. Jain (Vice President) and Vikram Singh Yadav (Accountant Member) decided to revoke the disallowance and upheld the appeal filed by the concerned parties.
The Bangalore bench of the Income Tax Appellate Tribunal (ITAT) held that the interest income earned from the scheduled banks would not be entitled to deduction under section 80P(2)(a)(i) or 80P(2)(d) of the Income Tax Act,1961.
A single-member bench comprising George George K (Judicial) held that interest income earned from scheduled banks was not entitled to the claim of deduction either under section 80P(2)(a)(i) or 80P(2)(d) of the Income Tax Act and directed re-adjudication while allowing the appeal filed by the assessee.
The Income Tax Appellate Tribunal (ITAT) Kolkata Bench directed readjudication on reason of auditor inadvertently shown wrong disallowance sum under Section 43B of Income Tax Act, 1961 in audit report uploaded on Income Tax Portal.
The tribunal while considering the appeal admitted the submission of the assessee and restored the issue of disallowance made under Section 43B of the Income Tax Act to the file of the jurisdictional Assessing Officer . Further, directed that the assessee should file details of proof of payment showing that the said liability has been paid off before the due date of furnishing of return of income under Section 139(1) of the Income Tax Act and also produce the certificate from the auditor who made the inadvertent mistake in the audit report uploaded on the income tax portal. Therefore, a single member bench of Manish Borad (Accountant Member) allowed the appeal filed by the assessee.
The Ahmedabad bench of the Income Tax Appellate Tribunal (ITAT) held that the non-resident Indian assessee was eligible for a beneficial rate of tax at 15% on interest income during the calculation of tax amount under the India-USA Tax Treaty.
The two-member bench comprising Anil Chaturvedi (Accountant) and Siddhartha Nautiyal (Judicial) restored the file to the Commissioner of Income Tax (Appeals) to allow the assessee to provide supporting documents to validate that the assessee was a tax resident of the USA for the beneficial rate of tax calculation under India-USA treaty while allowing the appeal filed by the assessee.
The Surat Bench of Income Tax Appellate Tribunal (ITAT) in the absence of deliberate or intentional or gross negligence and hence condoned the delay of 85 days and allowed the plea for deduction of professional and salary expenses under proviso to Section 201 of the Income Tax Act,1961.
The Single member Bench of Pawan Singh, Judicial Member observed that there was only delay of about 85 days in filing appeal before CIT (A) and is not deliberate or intentional or gross negligence on part of assessee, therefore, considering the principle that when technical consideration and cause of substantial justice are pitted against each other, the cause of substantial justice may be preferred, therefore, delay in filing appeal before the CIT (A) is condoned.
The Kolkata bench of the Income Tax Appellate Tribunal (ITAT) directed the assessing officer to re-adjudicate the addition made without giving the sufficient opportunity of hearing to the assessee.
The two-member panel comprising Sanjay Garg (Judicial) and Girish Agrawal (Accountant) directed the assessing officer to re-adjudicate the matter by giving the sufficient opportunity of hearing 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 disallowed Tax Deducted at Source (TDS) credit cannot be added twice to the income of the assessee as it amounts to double the addition of income.
The two-member bench comprising Saktijit Dey (Judicial) and M. Balaganesh (Accountant) held that once a certain amount claimed as TDS credit was disallowed, the assessee’s claim of pre-paid taxes to that extent gets reduced. Therefore, there was no need for making any further addition of the corresponding amount to the income of the assessee as it amounts to the addition of the same amount twice while dismissing the appeal filed by the revenue.
The Kolkata bench of the Income Tax Appellate Tribunal (ITAT) dismissed the appeal filed by the revenue on the ground of the tax effect involved was less than the prescribed monetary limit by the Central Board of Direct Tax (CBDT) for filing the appeal.
The two-member bench comprising Sanjay Garg (Judicial) and Girish Agrawal (Accountant) held that since the tax effect involved was less than the prescribed limit, the present appeal was not maintainable under section 268A of the Income Tax Act, 1961 while dismissing the appeal filed by the revenue.
The Income Tax Appellate Tribunal (ITAT) Delhi Bench upheld the addition made under Section 36 of Income Tax Act for delayed deposit of Employees’ Provident Fund (EPF) and Employee State Insurance Corporation (ESIC)
A two member bench of B. R. R. Kumar(Accountant Member) and Yogesh Kumar U.S. (Judicial Member) confirmed the addition under Section 36 of the Income Tax Act for delayed deposit of EPF & ESIC.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) held that the receipts from international traffic pertaining to voyages should not be chartered as royalty.
The two-member bench comprising Dr. B. R. R. Kumar (Accountant Member) Yogesh Kumar Us (Judicial Member) held that revenue erred in treating the receipts from international traffic pertaining to voyage chartered as ‘Royalty’ . Ajay Vohra appeared for the assessee and Anshuman Pattnaik for the revenue.
The Delhi bench of Income Tax Appellate Tribunal (ITAT) has held that addition made on account of estimated rate of profit applied to turnover did not amount to concealment. Therefore, the bench deleted the penalty imposed by the Assessing Officer (AO).
The two member bench comprising Kul Bharat (Judicial Member) and Dr. B. R. R. Kumar (Accountant Member ) allowed the appeal filed by the assessee and deleted the penalty. Neeraj Jain, counsel appeared for the assessee and Sanjay Kumar, counsel appeared for the revenue.
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) ruled that it was not permissible for the assessing officer to conduct a second assessment on the identical matter within the same assessment year.
The two-member bench comprising Chandra Mohan Garg (Judicial Member) and Pradip Kumar Kedia (Accountant Member) quashed the second assessment order on the same issue on the same Assessment Year and allowed the appeal of the assessee.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) while condoning the delay of the appeal, it was held that period during covid-19 pandemic not included in the limitation period for filing appeal.
The two-member bench comprising Chandra Mohan Garg (Judicial Member) and Pradip Kumar Kedia (Accountant Member) directed the CIT(A) to consider the extended time limit and treat the appeals as has been filed within prescribed time limit.
The New Delhi bench of the Income Tax Appellate Tribunal (ITAT) upheld the deletion of the penalty imposed under section 271(1)(c) of the Income Tax Act, 1961 on the ground of the genuine disclose of all the material facts relating to the payment of a non-compete fee.
The two-member bench comprising Saktijit Dey (Judicial) and M. Balaganesh (Accountant) upheld the decision of the Commissioner of Income Tax (Appeals) for deletion of the penalty imposed under section 271(1)(c) of the Income Tax Act while dismissing the appeal filed by the revenue.
The New Delhi bench of the Income Tax Appellate Tribunal (ITAT) quashed the assessment order passed by the assessing officer without proper examination of documents and declared it as invalid as per the law.
The two-member bench comprising B. R. R. Kumar ( Accountant) and Yogesh Kumar US (Judicial) held that the assessment completed cannot be held to be legally valid and is liable to be quashed while allowing the appeal filed by the assessee.
The New Delhi bench of the Income Tax Appellate Tribunal (ITAT) held that the utilisation of traveling expenses which was used for business purposes and not for personal use can be treated as deductible expenditure.
The two-member bench comprising B. R. R. Kumar (Accountant ) and Yogesh Kumar US, (Judicial) directed the assessing officer to re-adjudicate for allowing the claim of the assessee while allowing the appeal filed by the assessee.
The Pune bench of the Income Tax Appellate Tribunal (ITAT) held that the compulsory acquisition of agricultural land will not attract the capital gains which was chargeable to tax calculation.
The two-member bench comprising R.S. Syal (Vice President) and Partha Sarathi Chaudhury (Judicial) directed the assessing officer to re-adjudicate the matter while allowing the appeal filed by the assessee.
The Chandigarh Bench of Income Tax Appellate Tribunal (ITAT) held that mere non-furnishing of a copy of the registration of charitable Trust under Section 12A of the Income Tax Act cannot be a reason to deny exemption under Section 11 of the Income Tax Act and hence set-asides the order of Commissioner of Income Tax (Appeals) [CIT(A)].
The Bench comprising of A.D. Jain, Vice President and Vikram Singh Yadav, Accountant Member held that mere non-furnishing of a copy of registration under Section 12A of the Income Tax Act cannot be held as a valid and justifiable reason for denial of exemption under Section 11 of Income Tax Act of the Act where such registration continues to exist and the assessee trust duly stand registered under Section 12A of Income Tax Act for the year under consideration. The Tribunal further noted that the assessee trust’s current registration under Section 12A of the Income Tax Act continues to be valid and that the new registration rules have no impact on the assessee trust’s registration for the challenged assessment year 2020–21.
The New Delhi Bench of the Income Tax Appellate Tribunal (ITAT), observed that the revenue received on account of provision of facilities and services of seismic data acquisition and mining services are not Fees for Technical Services (FTS) taxable under Section 44B of the Income Tax Act, 1961.
Reliance was placed on behalf of the assessee on the decision of Supreme Court in the case of ONGC Limited vs. CIT, wherein it was held that similar services provided by the assessee were specifically covered under the provision of Section 44BB of the Income Tax Act and, therefore, general provision of Section 44DA of the Income Tax Act could not be applied.
The Third Member observed that “The said services or facilities provided by the assessee actually are inextricably connected with prospecting for, or extraction or production of, mineral oils as held by the Supreme Court in the case of ONGC, under the similar facts and circumstances and the revenue received for the same accordingly is taxable under Section 44BB of the Income Tax Act.”
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has held that the revenue earned by a non-resident assessee on the sale of a copyrighted article is not like royalty.
“The amount paid by resident Indian end users/distributors to non-resident computer software manufactures/suppliers as consideration for the re-sale/use of the computer software through end user license agreement/distribution agreement is not like royalty for the use of copyright in the computer software, hence, cannot be treated as royalty,” the two-member Shri G S Pannu, President and Shri Saktijit Dey, Judicial Member observed.
The New Delhi Bench of the Income Tax Appellate Tribunal (ITAT), ruled that the amount received as reimbursement of service tax not includible in gross turnover for purpose of computing taxable income under Section 44BB of the Income Tax Act, 1961.
The Third Member observed that “the amount received by the assessee as reimbursement of service tax is not includible in gross turnover for the purpose of computing taxable income under Section 44BB of the Income Tax Act.”
The New Delhi Bench of the Income Tax Appellate Tribunal (ITAT) deleted disallowance in the matter of expenses incurred by the Permanent Establishment (PE) to be set off in legal expenses against the interest income.
A Two-Member Bench of the Tribunal comprising GS Pannu, President and Saktijit Dey, Judicial Member observed that “As regards assessee’s claim of disallowance of brought forward loss and set off of current year loss against the current years income, issues have become consequential in view of our decision qua the issue of existence of PE and taxability of interest income. Hence, the Assessing Officer has to give effect in accordance with the relevant statutory provisions.”
The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT), allowed capital gain exemption on assessee who is not exclusive owner of multiple residential properties occupied by other family members.
A two-Member Bench of the Tribunal comprising Kavitha Rajagopal, Judicial Member and Om Prakash Kant Accountant Member, observed that “The claim of deduction under Section 54 of the Income Tax Act need to be allowed, as there is no material to show that assessee is exclusively owner of the other five residential properties/flats which are occupied by the other family members.”
The Mumbai Bench of the Income Tax Appellate Tribunal (ITAT), allowed Corporate Social Responsibility (CSR) Expenditure on community development, and environment, health and safety expenses.
A two-Member Bench of the Tribunal comprising Amarjit Singh, Accountant Member and Sandeep Singh Karhail, Judicial Member observed that “Therefore, in view of the above, once the expenditure has been accepted to be for the community development, and environment health & safety expenses, the same cannot be held to be not incurred wholly and exclusively for the purpose of business in the year under consideration.”
“Further, it cannot be disputed that the expenditure incurred on environment health and safety, as stated above, are relevant considering the business in which the assessee is engaged, i.e. development and implementation of coal-based thermal power project” the Bench held.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) held that no penalty should be levied on the grounds of non-auditing of accounts if bonafidely claims exemption under Section 11 of Income Tax Act, 1961.
The single -member bench comprising Sandeep Gosain, (Judicial Member) deleted the penalty imposed under Section 271B of Income Tax Act.
The Chandigarh bench of the Income Tax Appellate Tribunal (ITAT) held that the Assessing Officer (AO) has wrongly invoked Section 50C (1) of the Income Tax Act, 1961.
The two-bench member consisting of Sudhanshu Srivastava (Judicial member) and Vikram Singh Yadav (Accountant member) held to restore the appeal to the file of the Assessing Officer with the direction to re-adjudicate the issue after giving proper opportunity to the assessee to present his case. The assessee was directed to properly avail the opportunity being granted to him at juncture and to fully cooperate during the set aside the assessment proceedings. If the assessee fails then the Assessing Officer shall have the liberty to decide the issue at hand ex-parte qua the assessee on merits and in accordance with law. Therefore, the appeal of the assessee stands allowed for statistical purposes.
The Chennai Bench of Income Tax Appellate Tribunal (ITAT) while condone delay in filing appeal observed that ex parte order of Commissioner of Income Tax (Appeals)[CIT(A)] sent to the email address of former chartered accountant of assessee and direct readjudication.
The two-member bench comprising V. Durga Rao, (Judicial Member) and Manoj Kumar Aggarwal (Accountant Member) held that condone the delay in both the appeals and restore the appeals to the file of first appellate authority for deno vo adjudication. K.Meenakshisundaram, counsel appeared for the assessee and P. Sajit Kumar, counsel appeared for the revenue.
The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) has deleted the additions made on the cash out of income leaving aside the amount of huge cash withdrawals from State Bank of India to United Commercial Bank. A bench consisting of a single member, C.M. Garg (Judicial Member), carefully reviewed the arguments presented by both parties. The ITAT bench concluded that the AO made an incorrect decision by solely focusing on the cash derived from income while disregarding the substantial cash withdrawals from the assessee’s State Bank of India account. The amount of these cash withdrawals surpassed the impugned cash deposit made to the UCO Bank account of the assessee. Thus , the bench deleted the addition made by the assessing officer
