This Round-Up analytically summarizes the key stories related to the Income Tax Appellate Tribunal (ITAT) reported at Taxscan.in during September 16 to September 22, 2023.
The Pune bench of the Income Tax Appellate Tribunal (ITAT) held that the error in the assessment order shou be one that it is not debatable or plausible view. In a case where the Assessing Officer examined the claim took one of the plausible views, the assessment order cannot be termed as an “erroneous”
The two member bench consisting of S.S Viswanethra Ravi (Judicial member) and Inturi Rama Rao (Accountant member) he that he assessment order cannot be termed as “erroneous” amenable for jurisdiction under Section 263 of the Income Tax Act. Thus, the . CIT (Exemption) ought not to have exercised the jurisdiction under Section 263 of the Income Tax Act. Accordingly, the grounds of appeal filed by the assessee were allowed.
The Ahmedabad bench of the Income Tax Appellate Tribunal (ITAT) held that proceedings under Section 147 of the Income Tax Act being initiated by AO was on wrong assumption of facts, thus not sustainable.
The two member bench consisting of Madhumita Roy (Judicial member) and Waseem Ahmed (Accountant member) held that the AO has initiated the proceedings under Section 147 of the Income Tax Act, based on the wrong assumptions of facts and therefore the same is hereby quashed. Hence, the ground raised by the assessee in the CO was allowed.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has deleted the interest for late deposit of Tax Deducted at Source (TDS) against the Central Bank of India as the late deposit of TDS was in compliance with interim injunction order during the pendency of writ petition.
The two-member Bench of N. K.Billaiya, (Accountant Member) and Yogesh Kumar U.S., (Judicial Member) allowed the appeal filed by the assessee considering the fact that there was an interim order dated 29/03/2011 in operation as on the date of remittance TDS, thus, in our opinion, there was sufficient cause for the assessee not to remit TDS amount and the authorities ought not to have charged the interest on the Assessee, accordingly the Bench set aside the order of the CIT(A) by deleting the interest levied on the Assessee by the Revenue for late payment of TDS amount.
The Pune bench of the Income Tax Appellate Tribunal (ITAT) held that excess income declared during the course of survey proceedings cannot be treated as unexplained income since the same way credited to the profit and loss account by the assessee. It was added that the same was to be assessed as income from business.
The single member bench consisting of Inturi Rama Rao (Accountant member) held that excess income declared during the course of survey proceedings cannot be treated as unexplained income of the assessee-appellant since credited to P & L A/c and cannot be assessed as income from other sources, but, under income from business. Thus the appeal was allowed.
The Ahmedabad bench of the Income Tax Appellate Tribunal (ITAT) that when the same claim of cost of improvement made by the co-owner has been accepted, then the assessee cannot be treated differently.
The two member bench comprising of T.R Senthil Kumar (Judicial member) and Waseem Ahmed (Accountant member) set aside e finding of learned CIT(A) regarding the claim of cost of improvement on account of compensation paid to “Om Shri Sanat Non-Trading Owners Association” and direct the AO to allow the claim of the assessee in this regard. Hence, in totality the claim of the assessee on the issue raised by him vide impugned grounds of appeal was allowed.
The Ahmedabad bench of the Income Tax Appellate Tribunal held that assessee is entitled to claim weighted deduction on all expenditure incurred by it, on in-house research & development facility.
The two member bench consisting of T.R Senthil Kumar (Judicial member) and Annapurna Gupta (Accountant member) held that the Revenue has erred in restricting the claim of weighted deduction under Section 35(2AB) of the Income Tax Act to the extent approved by the prescribed authority i.e. DSIR. The AO was directed to allow full benefit of claim of weighted deduction to the assessee to the extent claimed in the P&L accounts and the disallowance made under Section 35(2AB) of the Income Tax Act was directed to be deleted, Thus the appeal was allowed.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) held that The Assessing Officer (AO) has ignored main cash book while disputing the source of cash and making addition and the Commissioner of Income Tax (Appeals) [CIT(A)] considered entire facts and circumstances in the right prospective and thereafter granted relief to the assessee, upholding the decision of CIT(A).
It was further observed that the CIT(A) went in detail and further noted that the cash withdrawals during April 2016 was Rs. 1,00,20,000, in August 2016 was Rs. 2,81,00,000/- and in September 2016 was Rs. 68 lakh and in October 2016 was Rs. 53 lakh. Thus, noted that during FY(Financial Year) 2016-17 cash withdrawals were Rs. 6,30,90,000/- out of which Rs. 5,71,40,000/- were withdrawn during April to October 2016 i.e. prior to demonetization declaration.
Therefore, the Two Member Bench comprising of Chandra Mohan Garg, Judicial Member and Dr. B.R.R. Kumar, Accountant Member held that the source of cash deposited during demonetization period by the assessee was opening cash balance and cash withdrawals during pre demonetization period which are higher than the amount of cash deposited by the assessee.
The Jaipur Bench of Income Tax Appellate Tribunal (ITAT) held the assessee was deprived off to contest the case before the lower authorities being not receipt of notices at the correct address concerning in her case, thus deleted the the penalty of Rs.10,000 made under Section 271(1)(b)of the Income Tax Act,1961.
The Bench comprising of DR. S. Seethalakshmi, Judicial Member and Rathod Kamlesh Jayantbhai, Accountant Member observed that the assessee being an illiterate rural lady who is living at Bhoyan Tehsil-Chaksu, Jaipur (Raj) could not pursue her case before the lower authorities and simultaneously she could not comply with the notices issued to her being not received at her correct address. It indicates that the assessee remained deprived off to contest the case before the lower authorities.
The Income Tax Appellate Tribunal (ITAT) Mumbai bench held that income received on redemption of Foreign Convertible Currency Bond (FCCBs) issued by the resident company is chargeable to tax in hands of ultimate beneficiaries not the trustees of the bonds.Therefore the bench quashes the reassessment proceedings against non resident company.
After considering the facts submitted by both parties, the two member bench of S. Rifaur Rahman (Accountant Member) and Aby T. Varkey (Judicial Member) observed that income received on redemption of Foreign Convertible Currency Bond (FCCBs) issued by the resident company is chargeable to tax in hands of ultimate beneficiaries not the trustees of the bonds.Thus the bench quashed the reassessment proceedings against the assessee.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has upheld the disallowance of bad debts as the capital investment from surplus funds was available out of various income taxed under different heads without precise accounting.
The two-member Bench of C.M. Garg, (Judicial Member0 and Pradip Kumar Kedia, (Accountant Member) observed that the CIT(A) had considered the requirement of Section 36(1)(vii) read with Section 36(2) of the Income Tax Act and thereafter concluded that the appellant had not involved in any such business activity, he had not held any asset as stock-in-trade and never any income from such business had been offered for tax anytime.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) has held that the salary income earned by the Indian National is not taxable under Section 9(1) of the Income Tax Act 1961 as well as under Article 15(1) of the India Netherland Double Taxation Avoidance Agreement (DTAA).
The two-member Bench of Kul Bharat, (Judicial Member) and M. Balaganesh, (Accountant Member) observed that it was very clearly stated that the terms and conditions of the employment with Akzo Nobel India Ltd stood suspended for the duration of the assignment in the Netherlands. Further the AO had observed that throughout the international assignment, the salary was paid by Akzo Nobel India Ltd and it was factually incorrect.
The Income Tax Appellate Tribunal (ITAT) Chennai bench while directing to treat addition as the income from business and Tax at the normal rates observed that Assesee showed higher sales during demonetization period to cover up cash deposits to bank account.
After considering the facts submitted by both parties, the single member bench of Manjunatha. G (Accountant Member) directed the AO to treat addition as income from business and tax at normal rates instead of 60% as per provisions of Section 115BBE of the Income Tax Act.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) held that since no reasonable cause has been adduced by the assessee except for the death of father of handling Charted Accountant (CA), the Tribunal could not condone the delay of 257 days in filing appeal.
The Bench comprising of Chandra Mohan Garg, Judicial Member and M. Balaganesh, Accountant Member observed that the assessee had filed a condonation petition before us stating that the father of Chartered Accountant (CA) looking after the income tax affairs of assessee had expired on 14.2.2022 and the first show cause notice was issued by the PCIT on 07.03.2022.
The Income Tax Appellate Tribunal (ITAT) Delhi bench held that no assessment order should be passed under Section 153C of the Income Tax Act, 1961 when seized documents did not establish any correlation with that assessment year.
After considering the facts submitted by both parties, the two member bench of N.K. Billaiya (Accountant Member) and Kul Bharat (Judicial Member) held that no assessment order should be passed under Section 153C of the Income Tax Act. When seized documents did not establish any correlation with that assessment year. Therefore the bench allowed the appeal filed by the assessee.
The Ahmedabad bench of the Income Tax Appellate Tribunal (ITAT) held that in order to prevent miscarriage of justice, the assessee was provided one more opportunity of being heard in support of its case for registration of the trust under Section 12AB of the Income Tax Act.
The two member bench consisting of Waseem Ahmed (Accountant member) and T.R Senthil Kumar (Judicial member) held that in order to prevent miscarriage of justice, the aseesee was provided one more opportunity of being heard to the assessee in support of its case for registration of the trust under Section 12AB of the Income Tax Act. Therefore the appeal was disposed by restoring this issue to the file of the CIT(E) with a direction upon him to provide further opportunity of being heard to the assessee and consider the documents, evidences which the assessee wou file as per the notice issued by the CIT(E). Needless to say if the assessee fails to co-operate with the CIT(E) as directed, the CIT(E) would be at liberty to pass orders strictly in accordance with law.
The Ahmedabad bench of the Income Tax Appellate Tribunal held that Assessee cannot be denied claim of exemption under Section 80IB(10) for he obtained each block and usage permission from local authority within 5 years.
The two member bench consisting of Waseem Ahmed (Accountant member) and T.R Senthil Kumar (Judicial member) held that separate planning permission was obtained by the assessee for each Block separately and after construction, separate Buiing Usage permission from the Local Authority within 5 years period, therefore the assessee cannot be denied the claim of exemption under Section 80IB(10) of the Income Tax Act. Thus the order passed by the Lower Authorities on this issue is hereby set aside and the Assessing Officer is directed to allow the claim of deduction under Section 80IB(10) of the Income Tax Act amounting to Rs. 31,64,266/-. Thus the appeal was allowed.
The Ahmedabad bench of the Income Tax Appellate Tribunal (ITAT) he that capital gain on revaluation of land to partners are not sustainable under law for Conversion of partnership firms can be considered only in the hands of the firms under Section 47(xiii)(b) of the Income Tax Act.
After hearing both the parties, the two member bench consisting of Waseem Ahmed (Accountant member) and T.R. Senthil Kumar (Judicial member) held that the addition made on account of capital gain on revaluation of land made in the hands of the Partners are not sustainable in law and the Grounds raised by the Revenue are devoid of merits. Thus the appeal was dismissed.
The Income Tax Appellate Tribunal (ITAT) Ahmedabad bench held that income from engaging in nursery activities of growing various types of lawns, flower plants and vegetables plants is agricultural Income, Could not be levied under Business Income.
After considering the facts submitted by both parties, the two member bench of Annapurna Gupta (Accountant Member) and Suchitra Kamble (Judicial Member) held that income from engaging in nursery activities of growing various types of lawns, flower plants and vegetables plants is agricultural Income, Could not be levied under Business Income.
The Income Tax Appellate Tribunal (ITAT) Mumbai bench has issued a corrigendum for typographical errors in tribunal order in Deutsche Asset Management’s Case.
After considering the facts the two member bench of Prashant Maharishi (Accountant Member) and Amit Shukla (Judicial Member) admitted that there were typographical errors and issued the Corrigendum for typographical errors in tribunal order in the assessee’s case.
The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has directed re-adjudication for the Departmental Valuation Officer (DVO) report as the AO had merely rejected the valuation report without referring the matter for valuation to the DVO.
The two-member Bench of B R Baskaran, (Accountant Member) and MS. Kavitha Rajagopal, (Judicial Member) observed that the A.O. had failed to accept the valuation report of the assessee for the reason that the valuer had not adopted any methodology or reference for the purpose of calculation of the land value without considering the factors such as value of the land as per stamp authority, land market price, location factors and the value at which the neighbouring lands were sold during that period etc.
It was observed from the said fact that the A.O. had not referred the said matter for valuation to the DVO while he had merely rejected the valuation report submitted by the assessee. The Bench allowed the appeal filed by the assessee directing the A.O. for valuation of the assets by referring the same to the DVO and to consider the said issue in light of the valuation report of the DVO.
The Income Tax Appellate Tribunal (ITAT) Delhi bench held that no addition should be made without making independent inquiry from concerned builder regarding the purchase of the property.
After considering the facts submitted by both parties, the two member bench of N.K.Billaiya (Accountant Member) and Kul Bharat (Judicial Member) dismissed the appeal filed by the revenue and observed that without making independent inquiry from concerned builder regarding the purchase of the property, AO had made all the additions.
The Income Tax Appellate Tribunal (ITAT) Delhi bench has deleted the penalty imposed under Section 271(1)(b) of the Income Tax Act, 1961 due to failure to follow proper procedure to serve notice for assessment proceedings.
After considering the facts submitted by both parties, the two member bench of N K Billaiya (Accountant Member) and Yogesh Kumar U S (Judicial Member) held that assessing officer failed to follow the proper procedure to serve notice for assessment proceedings.
The New Delhi bench of ITAT quashed the appeal by Deputy Commissioner of Income Tax (DCIT), (the appellant) for levying Income tax from Aruna Chandhok, (the respondent) for the bonus shares she received, as per section 56(2)(vii)(3) of the Income Tax Act, 1961.
A two-member bench consisting of M.Balganesh (Accountant Member) and Anubhava Sharma (Judicial Member) after hearing the both sides held the CIT(A) had rightly appreciated the contentions of Aruna Chandhok and granted relief to her. The appeal was hence dismissed by the Tribunal.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) held that if bona fides of the losses claimed are sufficiently proved by the assessee and the onus has been primarily discharged on the parameters of penalty proceedings. Thus the Bench upheld the decision of Commissioner of Income Tax (Appeals) [CIT(A)] in deleting the penalty imposed.
The Tribunal Bench comprising of Saktijit Dey, Vice President and Pradip Kumar Kedia, Accountant Member noted that the assessee is a rural bank run by the professional management, the fact that the amalgamation has taken place resulting in the stationery becoming unusable and obsolete.
The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has directed adjudication as to claim under Section 80IA(4) of the Income Tax Act 1961 as the assessment order did not contain discussion on legal aspects highlighted by the Principal Commissioner of Income Tax (PCIT) in the notice used under Section 263(1) of the Income Tax Act.
The two-member Bench of B.R. Baskaran, (Accountant Member) and Rahul Chaudhary, (Judicial Member) on perusal of the Assessment Order, noted that the Assessment Order had not contain any discussion on the factual and legal aspects highlighted by the PCIT in the notice issued under Section 263(1) of the Income Tax Act pertaining to the claim of deduction under Section 80IA (4) of the Income Tax Act on account of which case of the Appellant was selected for scrutiny. The Bench further directed re-adjudication allowed the ground with regard to claim under Section 80IA (4) of the Income Tax Act and partly allowed the concern regarding order under Section 263 of the Income Tax Act.
The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has held that the penalty under Section 271B of the Income Tax Act 1961, would not be leviable when the assessee engaged in the business of trading, financing, reality and commodities had not maintained the books of accounts.
The two-member Bench of Amit Shukla, (Judicial Member) and Gagan Goyal, (Accountant Member) observed that the penalty had been levied under Section 271B of the Income Tax Act for violation of Section 44AB of the Income Tax act i.e. failure to get the accounts audited.
The Delhi bench of the Income Tax Appellate Tribunal (ITAT) helx that even if capital gain computed on the land and on the buiing separately as a long term capital asset and as a short term capital asset respectively still there is no liability arises on the assessee to pay additional tax on account of capital gains.
The two member bench consisting of Narendra Kumar Billaiya (accountant member) C.N Prasad (Judicial member) directed the AO to allow indexation on cost of acquisition and cost of improvement while computing the long term capital gain as was done in the case of the co-owner and the assessee’s brother Harsh Bansal. Thus the appeal was allowed.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) held that the assumption of jurisdiction for reopening the assessment by the Assessing Officer is bad in law and notice under Section 148 of the Income Tax Act deserves to be quashed.
The Bench comprising of N.K. Billaiya, Accountant Member, and Yogesh Kumar U.S, Judicial Member observed that there is no finding by the AO that there was failure on the part of the assessee to disclose fully and truly all material facts during the original assessment proceedings.
The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has deleted the addition under Section 68 of the Income Tax Act 1961, and disallowance of Long-term Capital Gains (LCG) the allegation of price manipulation was against the purchase and sale of shares made through Securities and Exchange Board of India (SEBI).
The two-member Bench of Prashant Maharishi, (Accountant Member) and Sandeep Singh Karhail, (Judicial Member) observed from the perusal of the said statement issued by HDFC Securities Ltd, that the assessee had also transacted in shares of companies other than Nouveau Multimedia Ltd. Further, as per the contract note dated 27/04/2011, found that the assessee had sold the shares of Nouveau Multimedia Ltd and other companies.
The Income Tax Appellate Tribunal (ITAT) Ahmedabad bench while directing readjudication in respect of assessment order observed that the assessment order was passed without considering the additional evidence filed by the assessee under Rule 46A of the Income Tax Rules.
After considering the facts submitted by both parties, the two member bench of Waseem Ahmed (Accountant Member) and T.R. Senthil Kumar, (Judicial Member) set aside the matter back to the file of CIT(A) with a direction to entertain the additional evidence filed by the assessee under Rule 46A of Income Tax Rules.
The Kolkata bench if the Income Tax Appellate Tribunal (ITAT) held that when original return filed is defective and the defect is removed under Section 139(9) of the Income Tax Act, the return filed under Section 139(1) becomes a valid return from the date when it was originally filed.
The two bench member consisting of Rajesh Kumar (Accountant member) and Rajesh Kumar (Judicial member) held that view taken by the authorities below is not correct since the assessee submitted original return defective and defect was removed under section 139(9) of the Act, the return filed under section 139(1) becomes valid return from the date when it was originally filed.
The Hyderabad Bench of Income Tax Appellate Tribunal (ITAT) has held that the SBI short-term deposit rates would be applicable to determine the interest on trade receivables under Section 92B(1) of the Income Tax Act.
The two-member Bench of Rama Kanta Panda, (Vice President) and Laliet Kumar, (Judicial Member) observed that whenever there were outstanding trade receivables, the same were required to be benchmarked by applying the SBI Short term deposit interest rate for the subject year to determine the ALP interest rate.
The Pune Bench of Income Tax Appellate Tribunal (ITAT) has allowed registration under Section 2(15) of the Income Tax Act 1961, as the distribution of food to poor people and spending on cremation of the diseased during the Covid 19 was done by the trust.
The two-member Bench of S.S.Godara, (Judicial Member) and Dipak P. Ripote, (Accountant Member) observed that the CIT(E) had accepted the fact that assessee had filed evidences regarding activities. The assessee had claimed that assessee had distributed food to the poor people during the Covid-19 and also the expenditure on the funeral of poor people. We all know that the Pandemic period was a very disturbing period for the entire country. In this scenario, the assessee had distributed food to the poor people and the assessee also spent on cremation of the diseased. These activities were definitely as per the object of the Trust. The Bench allowed the appeal filed by the assessee holding that the assessee’s activities were charitable in nature as defined in Section 2(15) of the Income Tax Act.
The Ahmedabad Bench of Income Tax Appellate Tribunal (ITAT) has set aside the reopening done after 4 years as the escapement of income was not reflected and material facts were truly and fully discussed at the time of original assessment.
The two-member Bench of Annapurna Gupta, (Accountant Member) and Madhumita Roy, (Judicial Member) dismissed the appeal filed by the revenue holding that as the precondition for initiation of proceeding under Section 147 of the Income Tax Act by recording reasons of income, escaping assessment was not reflecting from the said order of reopening due to the failure on the part of the assessee, the same was not found to be sustainable and hence liable to set aside.
The Bangalore Bench of Income Tax Appellate Tribual (ITAT) held that deduction on income for providing credit facilities by co-operative society to be allowed on demonstration of mandatory requirement for following the mandatory maintaining of funds as per Karnataka Souharda Sahakari Act, 1997, thus remitted the case to the files of Assessing Officer (AO).
The bench comprising of George George K, Vice President and Laxmi Prasad Sahu, Accountant Member observed that if it is found in order, then the amount of deposits which are required to be maintained as per statutory requirement and interest earned to such extent will qualify for deduction under Section 80P(2)(a)(i) of the Income Tax Act. And Interest earned on deposits exceeding the statutory requirement will not be considered for allowing deduction under Section 80P(2)(a)(i) of the Income Tax Act.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that the penalty under Section 271B of the Income Tax Act, 1961 shall not be imposed unless the assessee has been given a reasonable opportunity of being heard.
The Two-member bench comprising of Amit Shukla (Judicial member) and Gagan Goyal (Accountant member) observed that quantum appeal is still pending before the Commissioner of Income Tax (Appeal) [CIT(A)] and the business of the assessee is discontinued long before as mentioned and was duly communicated to the Assessing Officer during the penalty proceedings.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that the penalty on disallowance under Section 24a of the Income Tax Act, 1961 cannot be imposed merely on the ground of wrong treatment made to the head of the Income.
The Two-member bench comprising of Kuldip Singh (Judicial member) and Gagan Goyal (Accountant member) observed that the cause of addition under the head Income from House Property was the different treatment given by the assessee in this year vis-àvis previous year.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT), while granting relief to Aditya Birla Nuvo group, held that the investment that had yielded the exempt income shall be considered for the purpose of working out the disallowances under rule 8D(2) of the Income Tax Rules, 1962.
The Two-member bench comprising of Amit Shukla (Judicial member) and Amarjit Singh (Accountant member) has remanded back to the file of Assessing Officer to decide the issue afresh even though the assessee might have suomoto offered disallowance which now has been claimed that no disallowance should be made in view of the decision of the Supreme Court in the case of South Indian Bank Ltd reported in 438 ITR 1 (SC), wherein Supreme Court has held that assessee has surplus funds and no disallowance of interest can be made.
The Income Tax Appellate Tribunal (ITAT) Delhi bench held that additional income surrendered during the course of survey proceedings should not be taxed at 60% under Section 115BBE of the Income Tax Act, 1961. Therefore the bench quashed the revision order.
After considering the facts submitted by both parties, the two member bench of M. Balaganesh (Accountant Member) and Kul Bharat (Judicial Member) quashed the revision order passed by the Pr.CIT.
The Income Tax Appellate Tribunal (ITAT) Delhi bench held that forfeiture of share application money is capital receipt and not revenue receipt.
After considering the facts and various judicial decisions, the two member bench of N.K.Billaiya (Accountant Member) and Kul Bharat (Judicial Member) held that forfeiture of share application money is capital in nature. Therefore the bench deleted the impugned addition. V. K. Agarwal, counsel appeared for the assessee. P. Barnwal, counsel appeared for revenue.
The Income Tax Appellate Tribunal (ITAT) Delhi bench held that no addition should be made if the assessee has sufficient interest free fund to provide interest free loans. Therefore the bench dismissed the revenue’s appeal.
After considering the facts submitted by both parties, the two member bench of N.K.Billaiya (Accountant Member) and Kul Bharat (Judicial Member) deleted the addition made by the AO in respect of interest free loan given by the assessee.
The Income Tax Appellate Tribunal (ITAT) Mumbai bench held that no addition should be made under Section 44ADA of the Income Tax Act, 1961 towards the income earned from the business of consultancy service.
After considering the facts and circumstances, the two member bench of B.R. Baskaran (Accountant Member ) and Narender Kumar Choudhry (Judicial Member) deleted the addition made under Section 44ADA of the Income Tax Act. Therefore the bench allowed the appeal filed by the assessee.
The Jaipur Bench of Income Tax Appellate Tribunal (ITAT) held that if the income, the escapement of which was the basis of the formation of the reason to believe, is not assessed or reassessed, it would not be open to the AO to independently assess only that income which comes to his notice subsequently in the course of the proceedings under the Section as having escaped assessment.
The Bench comprising of DR. S. Seethalakshmi, Judicial Member and Rathod Kamlesh Jayantbhai, Accountant Member observed that the crux of the issue in this appeal is that whether the reopening of the assessment by the AO is valid alongwith not providing copy of the reasons recorded by him to the assessee.
The Income Tax Appellate Tribunal (ITAT) Delhi bench held that no addition should be made if the assessee has sufficient interest free fund to provide interest free loans. Therefore the bench dismissed the revenue’s appeal.
During the appeal proceedings the tribunal observed that CIT(A) deleted the addition on the grounds that the assessee had sufficient interest free funds in their possession to provide interest free loans. Also assessee had interest free funds at their disposal to provide interest free loans. After considering the facts submitted by both parties, the two member bench of N.K.Billaiya (Accountant Member) and Kul Bharat (Judicial Member) deleted the addition made by the AO in respect of interest free loan given by the assessee.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that the “Other method” as per Rule 10AB shall be the most appropriate method for determining the arm’s length price of royalty transactions.
The Two-member bench comprising of Amit Shukla (Judicial member) and Amarjit Singh (Accountant member) remanded the matter back to the file of the TPO to adopt ‘Other Method’ as the most appropriate method and similar line of direction given for this year and to examine the working given by the assessee. The assessee would be at liberty to file any additional documents/submissions to justify the benchmarking on the basis of ‘Other Method’. Thus, the appeal of the assessee was partly allowed.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) while granting relief to the Central Bank of India, held that the disallowance of expenditure under Section 14a of the Income Tax Act, 1961 cannot be made when the exempt Income earning securities are held as stock-in-trade.
The Two-member bench comprising of G.S. Pannu (President) and Sandeep Singh Karhail (Judicial member) held that the exempt income earning securities are held by the assessee as stock in trade, therefore, disallowance of expenditure under Section 14A of the Income Tax Act cannot be made.
The Income Tax Appellate Tribunal (ITAT) Bangalore bench held that disallowance under Section 36(1)(iii) Income Tax Act, 1961 should not be made towards interest paid to the IDFC for loans taken to construct hostels for students.
After considering the facts submitted by both parties, the two member bench of Laxmi Prasad Sahu (Accountant Member) and George George K (Vice President) held that land purchase by the assessee is out of non-interest bearing funds. Therefore the Disallowance of interest of Rs.4.85 crores under Section 36(1)(iii) of the Income Tax Act is not warranted, the tribunal added.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that the compensation received by Echjay Industries on account of a defective product cannot be adjusted with the Written Down Value (WDV) of the assets.
The Two-member bench comprising of Amit Shukla (Judicial member) and Gagan Goyal (Accountant member) held that the stand of the assessee is correct and the action of the Assessing Officer is liable to be reversed. As the assessee has incurred the full cost of acquisition out of its own pocket and no part of the cost has been borne by anybody else.
The Income Tax Appellate Tribunal (ITAT ) Mumbai bench directed readjudication in respect of deletion of addition made towards the High Sea sales by the CIT(A) without giving proper reason.
After considering the facts submitted by both parties, the two member bench of Om Prakash Kant (Accountant Member) and Kavitha Rajagopal (Judicial Member) directed readjudication in respect of deletion of addition made towards the High Sea sales by the CIT(A) without giving proper reason.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) held that since the Assessing Officer (AO) himself has accepted the higher claim of 15% in Assessment Year 2014-15, thus allowed of claim of higher depreciation of 15 % on electrical fittings installed at factory premises.
The Bench comprising of Saktijit Dey, Vice President and Pradip Kumar Kedia, Accountant Member observed that in the plea of the assessee towards correctness of higher depreciation claimed on electric fittings installed at the factory premises. The AO himself has accepted the higher claim of 15% in Assessment Year 2014-15. Therefore the order of the CIT (A) is set aside on this issue and the AO was directed to reverse the disallowance on this score. Hence, ground of the appeal of the assessee was allowed.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) directed the Assessing Officer (AO) to allow assessee’s claim of deduction in respect of technical know-how payment on the basis of decision of Tribunal in previous Assessment Year (AY) 2015-16.
The Bench comprising of Shamim Yahya, Accountant Member and Challa Nagendra Prasad, Judicial Member found that this issue is squarely covered by the decisions of the ITAT in assessee’s own case in AYs 2013-14 to 2016-17, and observed that , “The Supreme Court has carved out the distinction between the payments at the time of setting up of the manufacturing facility and the payments made once the manufacturing process has already began. In the former case, royalty expenditure for setting up the manufacturing facility is capital in nature while in the latter case, the royalty expense is revenue in nature.” Thus the tribunal bench directed the AO to allow assessee’s claim of deduction in respect of technical know-how payment, and so the ground raised by the assessee was allowed.
The Delhi Bench of Income Tax Appellate Tribunal (ITAT) deleted the disallowances on signage expenses and sale tools expenses on the basis of decision of Tribunal in previous Assessment Year (AY).
The Bench comprising of Shamim Yahya, Accountant Member and Challa Nagendra Prasad, Judicial Member , with regards to the disallowance of signage expenses observed that this issue is squarely covered in favour of the assessee in assessee’s own case for AY 2015-16 & 2016-17.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) held that Section 263 of the Income Tax Act, 1961 cannot be invoked when the expenditure incurred on corporate social responsibility (CSR) is allowed by the Assessing Officer as a deduction under Section 80G of the Income Tax Act.
The Two-member bench comprising of Aby T Varkey (Judicial member) and Amarjit Singh (Accountant member) held that the Assessing Officer has considered the claim of deduction under Section 80G of the Income Tax Act on the expenditure which was part of CSR expenditure and also examined the issue that the assessee has added back the CSR expenditure in its return of income. Therefore, the bench considered that the order passed by the PCIT under Section 263 of the Income Tax Act is not justified. Thus, the order passed under Section 263 of the Income Tax Act was set aside. And the appeal of the assessee was allowed.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) while grating relief to Fox International Channels, held that broadcasting production rights doesn’t fall under the ambit of royalty under Article 12 of the United States Treaty.
The Two-member bench comprising of Rifaur Rahman (Accountant member) and Rahul Chaudhury (Judicial member) held that the Broadcasting Reproduction Right is different from the copyright as mentioned in the Copyright Act. therefore, the appeal of the assessee was allowed.
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) imposed a cost of Rs.5000/- on the assessee for non-compliance with the notices issued by the Commissioner of Income Tax (Appeal) [CIT(A)].
The Two-member bench comprising of Om Prakash Kant (Accountant member) and Sandeep Singh Karhail (Judicial member) held that as the assessee has not complied before the CIT(A) on all three dates without any reasonable and sufficient cause and due to non-compliance behaviour of the assessee, energy and time of the Income-tax authority has been wasted, which could have been used for justice delivery in other cases.
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