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161 orders · Page 3 of 4
The High Court held that the proceedings under Section 154 of the Income Tax Act were correctly initiated. The Court found that the evidence on record, including the assessee's own details of Capital Work in Progress showing capitalization in February 2007 and the fact that the machinery was put to use for less than 180 days in the assessment year 2007-08, was sufficient to determine that depreciation was allowable only at 50%. The Court reasoned that this was not a debatable issue requiring further investigation, as the evidence clearly indicated the date of use. Therefore, the ITAT's order quashing the Section 154 proceedings was set aside, and the appeal filed by the Revenue was allowed. The operative direction was to set aside the ITAT's order.
The High Court allowed the writ petition. The Court held that the show cause notice under Section 148A(b) and the consequential notice under Section 148 of the Income Tax Act, 1961, both dated March 21, 2022, were set aside. The reasoning was based on the petitioner's contention that the mandatory seven-day period required under Section 148A(b) for providing a reply to the show cause notice had not been complied with by the respondents, who had uploaded the notice on March 21, 2022, and given only four days for the petitioner to appear. The Court granted liberty to the respondents to proceed in accordance with law as per Section 148A(b) after giving due opportunity to the petitioner. No issue was expressly left undecided.
The High Court held that the petitioner is entitled to simple interest under Section 244A of the Income Tax Act, 1961, on the refund amount. The Court reasoned that the delay in validating the bank account by the petitioner cannot be a ground to deny interest, as the provision for interest is statutory. The Court referred to Section 244A, which entitles an assessee to interest on any amount of refund due. Applying the ratio of the Supreme Court judgment in Sadvik Asia Ltd vs. Commissioner of Income Tax-I, Pune, the Court found that the assessee has a right to claim interest. The petition was allowed, and the respondents were directed to pay simple interest at the rate of 9% per annum from 11.07.2016 until the payment is made, to be completed within three months from the receipt of the order. The Court did not expressly leave any issue undecided.
The Tribunal held that the AO had made sufficient inquiries regarding cash deposits, as the case was selected for scrutiny specifically for this purpose. Regarding cash purchases, the Tribunal noted that the AO was not required to investigate this issue further as per the CASS selection parameters.
The Tribunal held that the surrendered amount of Rs. 1,77,00,000/-, not directly linked to seized documents or disclosed information, fell under the definition of undisclosed income. However, the High Court upheld the Tribunal's decision to delete the penalty on this amount, finding no substantial question of law.
The High Court held that the writ petition was devoid of merit and dismissed it. Regarding the first issue, the Court noted that the show-cause notice was issued on 26.03.2022, and the impugned order was passed on 01.04.2022, which was the 7th day. The petitioner, instead of filing a reply, approached the Court. The Court distinguished the case of *Jindal Forgings* by stating that in that case, only three days were given, whereas here, the order was passed on the 7th day. The Court found that the notice was sent to the address on the PAN database, which was considered sufficient service, and the petitioner admitted receipt on 26.03.2022. The Court found no merit in the contention that the proceedings initiated for reassessment should be quashed. Regarding the second issue of competence, the judgment notes that the Assessing Officer initiated proceedings in accordance with Section 148A read with Sections 149/151 and obtained approval from the specified authority at every stage, implying competence. The ratio decidendi is that if a notice is served at the correct address and the assessee fails to respond or seek an extension, and the order is passed within a reasonable timeframe (here, the 7th day), the proceedings are valid, and the writ petition will be dismissed. No issue was expressly left undecided.
The High Court dismissed the appeal. On the issue of the Rs. 2,00,000 addition on account of the sale of rice, the Court found the case of *S.P. Construction* to be directly applicable. The Court noted that the assessee did not maintain a stock register quality-wise, making it impossible to ascertain the quantity of different qualities of rice produced. No evidence was provided by the assessee to substantiate its submissions. Referring to Section 145 of the Income Tax Act, the Court observed that income must be computed according to the method of accounting followed, and in the absence of qualitative details, it is difficult to examine sales. The Court held that the higher quality of rice could be shown as sold at a lower rate in bills, and there was a flaw in the maintenance of details. Therefore, the addition of Rs. 2,00,000 on account of the sale of rice was rightly made. The Court found no reason to interfere with the ITAT's order.
The tribunal held that the landlord is entitled to carry on business comfortably and cannot be forced to conduct business elsewhere if premises are available. The tenant failed to prove the landlord's independent possession of other shops.
The Tribunal held that the expenses incurred by the assessee from 07.07.2008 till 31.03.2009 were to be allowed as revenue expenditure. The reasoning was based on the finding that the assessee had set up its business on 07.07.2008, evidenced by the recruitment of key personnel like the Sales Head. The Tribunal affirmed the CIT(A)'s direction to the Assessing Officer to obtain details of expenses amounting to Rs.8,66,73,393/- from the disallowed sum of Rs.10,28,95,398/-, pertaining to the period after the business setup date, and to allow these as deductions. The ratio decidendi is that expenses incurred for setting up and commencing business operations after the effective date of commencement are allowable as revenue expenditure. The Tribunal also noted that the revenue could not controvert the assessee's earned income of Rs.17.14 million in the subsequent financial year 2009-10. The appeal was dismissed.
The High Court held that the appeal filed by the revenue deserved to be dismissed. The Tribunal had rightly dismissed the revenue's appeal by relying on the Supreme Court's judgment in CIT vs. Lovely Exports (P) Ltd. The Supreme Court in that case observed that if share application money is received from alleged bogus shareholders whose names are provided to the AO, the Department is free to proceed to re-open their individual assessments. The High Court found no infirmity in the Tribunal's order. The revenue's counsel was unable to show any evidence that was misread or that the first finding of fact by the Tribunal was erroneous. Therefore, the appeal was dismissed as devoid of merit. The operative direction was the dismissal of the revenue's appeal.
The High Court allowed the appeals filed by the assessee-companies. The Court held that the issue concerning the loan given to Shri A.S. Bhatia has been considered by the Hon'ble Supreme Court in Hero Cycles' case, where a similar situation of advances to directors from sufficient own funds was examined. The Supreme Court, in Hero Cycles, overruled the judgment in Abhishek Industries, which was relied upon by the ITAT. The Court noted that the judgment in Hero Cycles' case has been followed by this Court in Principal Commission of Income Tax vs. Holy Faith International (P) Ltd. The Court observed that the impugned advance was made out of interest-free funds available with the assessee, and therefore, there was no justification for disallowing interest under Section 36(1)(iii) of the Act. The ITAT's order was set aside, and the order of the CIT(A) was restored. The Assessing Officer was directed to recompute the disallowance as per the judgments in Hero Cycles and Holy Faith International.
The High Court held that the jurisdictional condition precedent for re-opening assessment under Section 147, specifically the failure to disclose a material fact which was the proximate cause of escapement of income, was not fulfilled. The Court found that the assessing officer had re-opened assessments based on a mere change of opinion regarding the nature of the contract, using the same material that was disclosed during the original assessments. This did not meet the "reason to believe" standard required under Sections 147 and 148. For assessment years 2009-10 to 2011-12, while the proceedings were not time-barred, the revenue failed to produce material showing that the re-assessment was initiated due to information not disclosed by the assessee or non-disclosure of primary facts. The Court relied on S. Narayanappa and others v. Commissioner of Income Tax, Bangalore, (1967) 1 SCR 590 (SC) to emphasize the need for reasonable grounds for belief of escaped assessment and the obligation to disclose such materials. Consequently, the impugned notices and the order dismissing objections were quashed. The substantial questions of law were decided against the respondents.
The High Court set aside the Tribunal's order and remanded the matter back to the Tribunal. This was done to allow parties an opportunity to adduce evidence, following a Supreme Court judgment.
The High Court allowed the appeal filed by the Revenue and set aside the impugned order dated 04.12.2015 passed by the ITAT. The Court noted that the respondent-assessee did not dispute being a supporting manufacturer. In light of the Supreme Court's decision in CIT, Karnal vs. M/s Carpet India, Panipat (2019 AIR (Supreme Court) 5032), which clarified that a larger bench had held that supporting manufacturers cannot be treated at par with direct exporters for the purpose of deduction of export incentives under Section 80HHC, the Tribunal's order allowing the assessee's appeal was deemed incorrect. The ratio decidendi is that the principle laid down in Baby Marine Exports is distinguishable and the Carpet India judgment governs the issue for supporting manufacturers concerning export incentives under Section 80HHC.
The High Court held that the appeal filed by the department/revenue deserved to be dismissed in view of the principle of consistency and rule of finality. The Court noted that the ITAT, in its order dated 28.08.2015, had accepted the assessee's appeal by setting aside the Assessing Officer's order. The Tribunal had found that for Assessment Years 2008-2009, 2009-2010, and 2011-2012, the Transfer Pricing Officer had accepted the transaction of management fees paid to NLC by NLT as being for business consideration and incurred wholly and exclusively for business purposes. Therefore, no addition was sustainable for Assessment Year 2010-2011. Regarding the disallowance under Section 40A(2)(b) for payments to TACL, the ITAT recorded that the Assessing Officer had failed to discharge the onus as per the mandate of Section 40A(2). The assessee had received services from TACL, and payments were made as per documentary evidence, justifying the payment on the principle of commercial expediency. The learned counsel for the appellant (Revenue) could not dispute the passing of prior orders in favor of the assessee. Consequently, no substantial question of law arose for consideration.
The High Court set aside the ITAT's order and remanded the matter back to the Tribunal. The Tribunal is to pass a fresh order after allowing parties to adduce evidence and necessary facts.
The High Court allowed the appellant's request to withdraw the present appeal. The reasoning provided is that the learned counsel for the appellant sought permission to withdraw the appeal to file it afresh with better particulars. Consequently, the appeal was dismissed as withdrawn. No decision on the merits of the case was made. The operative direction was to allow the withdrawal.
The High Court considered the appellant's request to withdraw the appeal. The court granted the permission sought by the learned counsel for the appellant to withdraw the present appeal to file afresh with better particulars. Consequently, the appeal was dismissed as withdrawn. No decision was made on the merits of the case. The operative direction was to allow the withdrawal of the appeal.
The High Court held that the travelling expenses of directors' wives and the fees paid to M/s Mckinsey and Company for professional services should be treated as revenue expenditure. The court allowed the appeals and set aside the impugned orders.
The High Court dismissed the appeal filed by the Principal Commissioner of Income Tax. The Court took note of the fact that a previous appeal, C.A. No. 12446 of 2017, involving the same assessee, M/s. Max India Limited, had been dismissed by the Hon'ble Supreme Court on January 6, 2020, on the grounds of low tax effect. The present appeal also concerns M/s. Max India Limited and has a total tax effect of Rs. 80,80,330. Following the precedent set by the Supreme Court and in compliance with Circular No. 17 of 2019 issued by the Ministry of Finance, Department of Revenue, Central Board of Direct Taxes, the High Court found it appropriate to dismiss the present appeal. No specific issue was left undecided; the appeal was disposed of on procedural grounds related to tax effect and circulars.
The High Court dismissed the revenue's appeals. Regarding the first issue, the Court noted that the ITAT's impugned order was based on a prior ITAT order for assessment year 2008-09, which had been upheld by the High Court itself in an earlier appeal (ITA-219-2013). In that earlier decision, the High Court had affirmed the ITAT's finding that the assessee had substantial interest-free funds from preferential share issues and dividend income, which were sufficient to cover the interest-free loans advanced to subsidiary companies. The Court found no nexus between the interest expenditure and these advances, warranting disallowance under Section 36(1)(iii). The High Court also observed that since no disallowance was made in earlier years, it was not open to the AO to make such a disallowance in subsequent years. The Court found no perversity in the Tribunal's findings. Regarding the second issue, the Court held that it was covered by its own prior decision in the assessee's case, which supported the assessee's contention that a presumption exists in favour of utilizing interest-free funds for investments yielding exempt income when sufficient such funds are available. The revenue failed to distinguish this prior decision. Consequently, no substantial question of law remained to be decided.
The High Court dismissed the appeals filed by the Revenue. It held that the ITAT had rightly examined the case for grant of registration under Section 12AA, focusing on the two parameters required: the object of the trust and the genuineness of its activities. The Court affirmed that the Commissioner is not to examine eligibility or activities in sync with the Companies Act, as these fall under the Assessing Officer's domain during assessment for exemption under Section 11. The High Court, referencing the Full Bench judgment of the Allahabad High Court in CIT(E) U.P.State Cons and Infra vs. M/s. Reham Foundation, held that the ITAT's power under Section 254(1) is unfettered, allowing it to direct registration if it disagrees with the Commissioner's satisfaction based on existing material. Since the ITAT had recorded its satisfaction that the trust fulfilled the conditions of charitable objects and genuine activities, remanding the matter would serve no useful purpose. Therefore, the ITAT rightly directed the CIT to grant registration under Section 12AA and approval under Section 80G(5)(vi).
The High Court allowed the application for withdrawal of the present appeal. The reasoning provided was that the designated authority had determined the amount payable under the VSV Act, which had been paid by the respondent-assessee, and Form No. 5 had been issued. Consequently, the main case (the appeal) was dismissed as withdrawn. The principle derived is that if parties agree to withdraw an appeal due to a settlement under a specific scheme like the VSV Act, and the conditions of that scheme are met, the court will allow such withdrawal.
The High Court allowed the application for withdrawal of the appeal. The Court noted that the designated authority had determined the amount payable under the VSV Act, which the respondent-assessee had paid. Consequently, Form No. 5 was issued on 02.11.2021. Based on these facts, the Court found no impediment to allowing the withdrawal of the appeal. The appeal was consequently dismissed as withdrawn. No specific issue regarding the merits of the original assessment or the appeal was decided.
The High Court allowed the application for withdrawal of the appeal. The Court noted that the designated authority had determined the amount payable under the Voluntary Scheme for Verification (VSV) Act, which had been paid by the respondent-assessee, and Form No. 5 was issued on 02.11.2021. Based on this submission, the Court found no impediment to allowing the withdrawal. Consequently, the main appeal was dismissed as withdrawn. The operative direction was the dismissal of the appeal as withdrawn.
The High Court allowed the application for withdrawal of the appeal. The Court noted that the designated authority had determined the amount payable under the VSV Act, which had been paid by the respondent-assessee, and Form No. 5 had been issued. Consequently, the appeal was dismissed as withdrawn. The operative direction was the dismissal of the appeal. No specific issues regarding the Income Tax Act were decided on merits.
The High Court held that the non-consideration of the petitioner's reply amounts to not affording an opportunity of hearing. The Court noted that the department admitted a reply was filed on 27.09.2021, and the petitioner also placed on record a reply dated 27.09.2021. Even if the reply appeared blank on the e-portal due to a glitch, it could not be concluded that the petitioner had nothing to say. The principle applied is that a party must be given a fair hearing, and their submissions must be considered. Therefore, the impugned order was set aside. The matter was remanded back to the Assessing Officer to consider the reply dated 27.09.2021 and pass a fresh order in accordance with the law. No other issues were expressly left undecided.
The Tribunal held that excess expenditure incurred in earlier years can be adjusted against the income of subsequent years. This adjustment is to be treated as an application of income for charitable purposes in the subsequent year.
The High Court held that the proviso to Section 14A is not attracted when the assessment order was not passed under Section 147. Therefore, the retrospective applicability of Section 14A would apply to the assessment years in question.
The High Court allowed the appeal, setting aside the impugned order of the ITAT dated 20.12.2007. The Court noted that similar issues were considered in ITA Nos. 826 and 848 of 2008, titled The Commissioner of Income Tax-I, Chandigarh Vs. M/s Punjab State Warehousing Corporation Limited. In those judgments, it was observed that the proviso to Section 14-A of the Income Tax Act, 1961, is not attracted when the assessment order was passed under Section 143(3) of the Act, and not under Section 147. Consequently, the provisions of Section 14-A, having retrospective applicability from 01.04.1962, would apply to the assessment years in question. The High Court found that the present case is squarely covered by those judgments. Therefore, the matter was remanded back to the Tribunal to decide afresh in accordance with law after hearing the parties. The High Court did not decide the merits of the disallowance under Section 14-A.
The High Court held that since the assessment order was not passed under Section 147, the proviso to Section 14-A was not applicable. Therefore, the retrospective applicability of Section 14-A would apply to the assessment years in question.
The High Court allowed the appeal, setting aside the Tribunal's order dated 24.12.2007. The Court followed its own previous judgments in ITA Nos. 826 and 848 of 2008, which dealt with the same assessee and similar issues concerning Section 14-A of the Income Tax Act, 1961. In those judgments, it was held that the proviso to Section 14-A, which was inserted to prevent reopening of past settled cases, is not attracted if the assessment order was passed under Section 143(3) and not under Section 147. Consequently, the retrospective applicability of Section 14-A from 01.04.1962 would apply to the assessment years in question. The matter was remanded back to the Tribunal to decide afresh in accordance with law after hearing the parties. No issue was expressly left undecided.
The High Court permitted the appellant's counsel to withdraw the present appeal. The court noted that the tax effect was on the lower side and that this appeal was listed along with ITA No. 181 of 2012. The appellant's counsel informed the court that ITA No. 181 of 2012 had already been withdrawn by the department. In light of this fact, the appellant's counsel prayed for the withdrawal of the present appeal, which was granted. The appeal was consequently dismissed as withdrawn. No substantive issues regarding income tax law were decided.
The High Court permitted the learned counsel for the appellant to withdraw the present appeal. The reasoning was based on the fact that a related appeal, ITA No. 181 of 2012, had already been withdrawn by the department. Consequently, the appeal was dismissed as withdrawn. No issues were decided on the merits of the assessment, and no operative directions were issued beyond the dismissal of the appeal. The principle that can be cited is that an appeal can be withdrawn by the appellant if they so choose, especially when related matters have been disposed of in a similar manner.
The High Court noted that the tax effect in the present appeal was on the lower side and that it was to be heard along with ITA No. 181 of 2012. The learned counsel for the appellant (revenue) informed the court that ITA No. 181 of 2012 had already been withdrawn by the department. In light of this fact, the learned counsel for the appellant prayed for the withdrawal of the present appeal. The High Court permitted the appellant to withdraw the appeal. Therefore, the appeal was dismissed as withdrawn.
The High Court permitted the learned counsel for the appellant (revenue) to withdraw the present appeal. The court noted that ITA No. 181 of 2012, which was to be heard along with the present appeal, had already been withdrawn by the department. Based on this submission, the appeal was dismissed as withdrawn. No decision on the merits of the case was made.
The High Court held that the Assessing Officer cannot ignore the 3rd proviso to Section 12A(2) of the Act by issuing a notice under Section 147. The Court noted that the petitioner's objections, filed pursuant to the notice under Section 148A(b), were dismissed by the Assessing Officer without considering the 3rd proviso to Section 12A(2). Therefore, relegating the petitioner to an alternative remedy would not be appropriate. The Court found that the registration of the petitioner-trust was granted on September 30, 2016, effective from assessment year 2016-17. Following the ratio of the Karnataka High Court in Karnataka State Students Welfare Fund's case, the Court concluded that no proceedings under Section 147 could be initiated for assessment year 2015-16. Consequently, the impugned notices and the order passed under Section 148A(d) were set aside as they were contrary to the 3rd proviso to Section 12A(2) of the Act. The Court explicitly stated that the 3rd proviso was not examined by the Allahabad High Court in Shiv Kumar Sumitra Devi Smarak Shikshan Sansthan's case.
The Tribunal held that personal expenses of directors paid by the company, even if agreed to be repaid, cannot be construed as loans violating Section 269SS. The High Court agreed that the same amount cannot be treated as both undisclosed income and a loan.
The High Court dismissed the appeal filed by the revenue. The Court held that the mere fact that the assessee-Trust had never received donations previously was not a relevant criterion for denying approval under Section 80G. Similarly, the maintenance of FDRs by the Trust could not be a criterion to deny approval, especially when these FDRs were maintained to obtain accreditation with regulatory authorities for professional colleges. The Court relied on its own previous judgment in ITA-54-2019 (The Commissioner of Income Tax (Exemptions), Chandigarh vs. M/s Shri Panchayati Gaushala Society). The Court found that the revenue had not been able to show that the view taken by the Tribunal was erroneous or that the order of the Tribunal was legally unsustainable. The registration under Section 12AA of the Act itself is not sufficient for approval under Section 80G, but the Tribunal had considered the genuineness of the aims and objects while granting 12AA registration and recorded reasons for granting 80G approval, which were not sustained by the revenue.
The Tribunal dismissed the department's appeal and partly allowed the assessee's appeal, deleting the addition on household expenses. The High Court found that the deposits were in the name of HUF, the source was explained, and issues regarding match fee and tour money were covered by earlier favorable decisions.
The High Court of Punjab and Haryana at Chandigarh, in its oral order, disposed of the writ petition. The judgment does not provide specific findings on the validity of the Section 148 notice or the arguments presented by either party. The operative direction was to dispose of the writ petition, but the specifics of the disposal (e.g., quashing the notice, upholding it, or remanding for further consideration) are not detailed in the provided text. No specific legal principle or ratio decidendi can be extracted from this brief oral order. No issues were expressly left undecided.
The High Court decided to dismiss the appeal as withdrawn. The reasoning was based on the appellant-revenue's submission that the tax effect was below the prescribed monetary limit for filing appeals, as per CBDT Circulars. The court granted the revenue the liberty to file an application for revival of the appeal, should any aspect of the matter survive. Since the main appeal was dismissed as withdrawn, any pending Civil Miscellaneous applications (C.M.) were also disposed of. No specific issue was decided on merits, and therefore, no ratio decidendi for future cases was established.
The High Court held that Section 12A of the Income Tax Act, 1961, would apply to the trust. This decision was based on a Supreme Court judgment in a similar case, which the respondent did not dispute.
The High Court dismissed the appeal. The decision was based on the submission made by the learned counsel for the respondent (assessee) that the amount of tax involved in the case was Rs. 33,66,000, which was below the monetary limit of Rs. 1,00,00,000 prescribed in the circulars dated 08.08.2019 and 17.10.2019. The Court accepted this submission and, in view of the said fact, dismissed the appeal. The reasoning is that the appeal falls outside the scope of appeals to be pursued by the revenue as per the administrative instructions contained in the circulars. The operative direction was the dismissal of the appeal. Liberty was granted to the appellant to get the appeal revived by filing an appropriate application if any cause of action still survives.
The High Court disposed of the writ petition. The decision was based on the statement made by the learned counsel for the respondents, who, on instructions, submitted that the release of the jewellery in question was under process and would be completed by January 27, 2023. In light of this assurance, the Court found no further orders to be necessary. The ratio decidendi is that when the revenue assures the release of seized goods within a stipulated timeframe, and this assurance is accepted by the court, the writ petition is disposed of on that basis. No specific issue regarding the legality of retention or entitlement to release was adjudicated on merits; the disposal was procedural based on the respondent's undertaking.