ITAT Agra Judgments — November 2017

The Tribunal held that while the assessee was engaged in preservation, handling, and storage, it failed to fulfill the conditions of processing, packaging, and transportation as required by Section 80IB(11A). Therefore, the assessee was not eligible for the deduction.

The Tribunal deleted the remaining addition on account of excess stock, finding it too small to warrant an adverse inference. It also deleted the addition for excess cash, noting that the CIT(A) had misread and failed to consider crucial documentary evidence from the cash book.

The Tribunal held that since proper notice was sent and the assessee did not appear, it indicated a lack of interest in prosecuting the appeal. Therefore, the appeal was liable to be dismissed for non-prosecution.

The Tribunal held that the reasons to believe escapement of income recorded by an Assessing Officer without jurisdiction are unsustainable in law. Consequently, all proceedings and the assessment order passed in furtherance of such invalid reasons are void ab initio.

The tribunal found that the CIT(A) relied on unreported decisions without confronting them to the assessee. Therefore, the matter was remitted back to the CIT(A) for a fresh decision after affording the assessee an opportunity to rebut these decisions.

The Tribunal held that for AY 2007-08, the admission of the assessee's appeal by the High Court indicated a debatable issue, making the penalty unsustainable. For AY 2009-10, the retrospective grant of registration under Section 10(23C)(vi) meant the assessee was exempt from tax, thus invalidating the penalty for concealment.

The Tribunal held that the CIT(A) had failed to decide the issue of limitation raised by the assessee regarding the penalty order. Therefore, the appeals and cross-objections were remitted back to the CIT(A) for fresh adjudication after deciding the issue of limitation first.

The Tribunal held that the proviso to section 12A(2) was applicable, entitling the assessee to the benefit of sections 11 and 12. The deletion of the deemed interest addition was upheld as no real income was earned.

The Tribunal held that the Assessing Officer (AO) had flouted the mandate of law laid down by the Hon'ble Supreme Court in GKN Driveshafts (India) Ltd. vs. ITO. This mandate requires the AO to decide the assessee's objections to the reasons recorded for reopening a completed assessment by a separate speaking order before passing the assessment order. The AO in this case failed to dispose of the assessee's objections before passing the assessment order. Furthermore, the learned Commissioner (Appeals) did not decide this crucial issue, despite the assessee specifically raising it. Consequently, the Tribunal set aside the impugned order and restored the matter to the file of the AO. The AO is directed to first decide the assessee's objections in accordance with law, after affording an adequate opportunity of hearing to the assessee, and only thereafter pass the assessment order. The assessee is directed to cooperate in the fresh proceedings, and all pleas available under the law shall remain available to the assessee. The appeal was treated as allowed for statistical purposes.

The Tribunal held that the funds were provided by Sahara India Commercial Corporation Ltd. (SICCL) as loans to the members for land purchase, and the AO did not question SICCL's capacity or the banking channels used. The identities of the members were also not disputed.

The Tribunal held that Section 2(22)(e) is not applicable as the assessee was neither a beneficial nor a registered shareholder in the lending companies. Regarding Section 40A(2)(b), the Tribunal found the interest rate paid was not excessive compared to market rates and was paid under a contractual obligation.

The CIT(A) had dismissed the assessee's appeal ex parte without deciding the merits of the case. Therefore, the Tribunal remitted the matter back to the CIT(A) to decide it afresh after providing a proper opportunity of hearing to the assessee.

The Tribunal held that the assessee was not interested in prosecuting the appeals. Therefore, the appeals were dismissed for non-prosecution.

The Tribunal held that penalty under Section 271(1)(c) is not leviable when income is assessed on an estimated basis which is substantially reduced by the appellate authorities. The observation of 'inflation of expenses' without specific evidence was not sufficient to penalize the assessee.

The Tribunal held that the CIT's order under Section 263 was a non-speaking order as it did not clearly explain how the assessment order was erroneous and prejudicial to the revenue. The matter was restored to the CIT for a speaking order.