ITAT Ahmedabad Judgments — June 2022

The Tribunal held that while there were flaws in the assessee's books, the 2% estimation of gross profit was excessive. It directed the AO to recalculate the addition based on a restricted GP rate of 1.25%. The issue of unsecured loan was remanded to the AO for fresh adjudication.

The Tribunal held that the unabsorbed depreciation from AY 2000-01 and 2001-02 is eligible for carry forward in future years as part of current depreciation. This decision was based on the jurisdictional High Court's ruling in the General Motors India Pvt. Ltd. case.

The Tribunal considered the assessee's request for withdrawal under the "Vivad se Vishwas" Scheme. Consequently, the appeal was dismissed as withdrawn.

The Tribunal permitted the assessee to withdraw the appeal as they had opted for the Vivad Se Vishwas Scheme. The appeal was dismissed as withdrawn, with liberty to seek restoration if the scheme benefits could not be availed.

The ITAT condoned the delay in filing the appeals before the CIT(A) by citing the principle of substantial justice over technical considerations. The tribunal also noted that the CIT(A) had not adjudicated the appeals on merits, violating principles of natural justice.

The Tribunal held that the Principal CIT was correct in revising the assessment order under Section 263. The assessee failed to provide evidence that the trucks were used for hiring out, which is a prerequisite for claiming higher depreciation.

The Tribunal held that TDS provisions do not apply to late fees and service tax. Since the payee had included this amount in its income and offered it for tax, the addition made by the Assessing Officer was deleted.

The Tribunal upheld the addition of income from cricket betting, estimated at 1% of total transactions, finding it fair and reasonable. The Tribunal also confirmed the addition of cash seized as commission/dalali income from real estate business.

The Tribunal held that the penalty notice was defective as it did not specify whether it was for furnishing inaccurate particulars or concealment of income. The AO's penalty order also lacked a clear finding on which limb the penalty was being imposed.

The Tribunal held that the transactions were in the nature of current account and business transactions, not loans or advances. Therefore, Section 2(22)(e) was not applicable.

The Tribunal held that the penalty was not leviable as the excess depreciation claim was made bonafide based on legal advice, and the assessee voluntarily disclosed and reversed it without detection by the revenue. The assessee was not found to have concealed or furnished inaccurate particulars of income.

The ITAT condoned the delay in filing the appeals before the CIT(A) by citing the principle of substantial justice over technical considerations. The tribunal also noted that the CIT(A) had not adjudicated the appeals on merits, violating principles of natural justice.

The Tribunal held that the land was agricultural land and the acquisition by the government attracted Section 10(37) exemption. It also found that the sale consideration was received before the relevant date for Section 50C, thus upholding the CIT(A)'s deletion of additions.

The Tribunal held that issuing a notice under section 148 to a deceased person is a nullity and vitiates the assessment proceedings. The assessment order made on a dead person is void ab initio.

The Tribunal allowed the appeal for statistical purposes, specifically allowing the claim for preliminary expenses. However, the addition related to capital gains on the sale of windmills and land was upheld as per the CIT(A)'s order.

The Tribunal held that M/s. S.S. Enterprises was a proprietary concern of M/s. Gunesh India Pvt. Ltd. and the PAN of the latter was validly provided. Therefore, the assessee was not required to deduct tax at source, and the disallowance under Section 40(a)(ia) was unjustified.

The Tribunal upheld the addition of income from cricket betting, estimating it at 1% of the total transactions. The Tribunal also confirmed the addition of cash seized as commission/dalali income from real estate business.

The Tribunal held that the freight charges recovered from customers are eligible for deduction under Section 80IB, as the assessee has provided necessary documentation and has been allowed this deduction in previous years. Therefore, the AO was directed to allow the deduction.

The Tribunal noted that while the amended provisions of Section 68 (requiring proof of source of source) were not applicable for AY 2012-13, the complex nature of the transactions and the AO's findings regarding the lack of liability of the intermediate companies warranted further examination. The Tribunal decided to give the assessee an opportunity to prove the genuineness of the transaction and the source of funds before the Assessing Officer.

The Tribunal upheld the CIT(A)'s deletion of disallowances for trademark expenditure and commission payments, finding that the assessee had provided sufficient evidence and that past allowance of similar payments indicated consistency.

The Tribunal, following a precedent, held that penalty under section 271(1)(b) should not be imposed for each and every notice that remained non-complied with. The penalty should be restricted to the first default.

The Tribunal held that the higher interest rate was justified due to urgent cash flow needs and the unsecured nature of the loan, and that the ad-hoc disallowance of expenses was made without proper consideration of evidence. Therefore, the disallowances were not sustained.

The Tribunal noted that the ITAT in the assessee's own case for AY 2012-13 had deleted additions related to share application money from the same parties, which formed the basis for reopening AY 2011-12. Following this precedent, the Tribunal deleted the addition for AY 2011-12.

The Tribunal held that the penalty under Section 271D was not warranted as the assessees had a reasonable cause for accepting cash loans due to business exigency and urgent financial necessity. The transactions were genuine, recorded in books, and no additions were made by the AO.

The Tribunal held that the PCIT's basis for revision was flawed because the CIT(A) had previously accepted the agricultural income as genuine for the preceding year after examining evidence. Therefore, the PCIT had no power to revise the AO's order.

The Tribunal held that penalty under Section 271(1)(c) is not sustainable if the notice initiating penalty proceedings does not specify the exact charge (concealment or inaccurate particulars). The Tribunal also noted that one addition was for a period outside the assessment year and the other was an inadvertent mistake rectified by the assessee.

The Tribunal held that the higher interest rate was justified due to urgent cash flow needs and the unsecured nature of the loan, and that the ad-hoc disallowance of expenses was made without proper consideration of evidence. Therefore, the disallowances were not sustained.

The Tribunal upheld the CIT(A)'s decision, stating that revaluation of assets in a partnership firm's books does not amount to a transfer for capital gains. Regarding CCM, the Tribunal found no evidence to disprove the assessee's explanation and upheld the deletion of the addition.

The Tribunal held that the CIT(A) was justified in admitting additional evidence under Rule 46A in the interest of justice, especially after obtaining a remand report from the AO. The CIT(A) has co-terminus powers and the admission of evidence did not vitiate the order.

The Tribunal held that for AY 2015-16, there was no prescribed time limit for filing Form-10. Since the deduction was claimed before the completion of a regular assessment (only an intimation under section 143(1) was passed), the assessee was eligible for the deduction. The orders of the lower authorities were quashed.

The Tribunal found that the Assessing Officer did not properly verify the documents submitted by the assessee. Therefore, the matter was remanded back to the Assessing Officer for proper adjudication and verification of the share capital issue.

The Tribunal held that the assessees had a reasonable cause for accepting cash loans due to business exigency and urgent financial necessity. The transactions were genuine, recorded in books, and involved family members, with no additions made by the AO. Therefore, the penalty under Section 271D was not warranted.

The Tribunal held that the penalty under Section 271D was not warranted as the assessees had a reasonable cause for accepting cash loans due to business exigency and urgent financial necessity. The transactions were genuine, recorded in books, and no additions were made by the AO.

The Tribunal held that the penalties were not justified as the delays were due to unavoidable circumstances and not wilful negligence. The Assessing Officer and CIT(A) failed to consider these crucial facts.

The Tribunal observed that the Revenue failed to rectify the defect in the appeal form despite repeated opportunities. Consequently, the appeal was not properly presented before the Tribunal.

The Tribunal held that the penalty under Section 271D was not warranted as the assessees had a reasonable cause for accepting cash loans due to business exigency and urgent financial necessity. The transactions were genuine, recorded in books, and no additions were made by the AO.

The Tribunal held that the penalties were not justified as the delays were due to unavoidable circumstances and not wilful negligence. The Assessing Officer and CIT(A) failed to consider these crucial facts.

The Tribunal held that the penalties were not justified as the delays were due to unavoidable circumstances and not wilful negligence. The Assessing Officer and CIT(A) failed to consider these crucial facts.

The Tribunal held that the penalties were not justified as the delays were due to unavoidable circumstances and not wilful negligence. The Assessing Officer and CIT(A) failed to consider these crucial facts.

The Tribunal held that the CIT(A) did not err in confirming the addition made by the AO. The transaction was considered a sham, and the LTCG exemption was rightly disallowed based on the abnormal price rise of penny stocks and lack of evidence from the assessee.

The Tribunal held that the higher interest rate was justified due to urgent cash flow needs and the unsecured nature of the loan, and that the ad-hoc disallowance of expenses was made without proper consideration of evidence. Therefore, the disallowances were not sustained.

The Tribunal held that the CIT(A) erred in law by not considering the binding precedent of the Gujarat High Court, which allows deduction under Section 80P(2)(d) for interest earned on deposits with cooperative banks. The Tribunal also condoned the delay in filing the appeal.

The Tribunal held that differential treatment cannot be meted out to co-owners of the same property. Since the co-owner's (assessee's brother) similar claim was accepted and his assessment attained finality, the assessee cannot be treated differently, quashing the revision order.

The Tribunal held that the PCIT's basis for revision was flawed because the CIT(A) had previously accepted the agricultural income as genuine for the preceding year after examining evidence. Therefore, the PCIT had no power to revise the AO's order.

The Tribunal held that the CIT(A) was correct in deleting the addition under Section 68 as the assessee provided sufficient evidence for the genuineness of the transaction. Regarding Section 14A, the Tribunal upheld the CIT(A)'s decision based on the availability of interest-free funds and net interest income.

The Tribunal held that the disallowance made by the CPC under section 143(1) for late payment of employees' contribution to PF/ESI, as per section 36(1)(va), is in accordance with law. The decision of the jurisdictional High Court on this issue was binding.

The CIT(A) correctly deleted the adjustment made to the book profits under Section 115JB. Since the ITAT allowed the deduction under Section 10AA under normal provisions, there was no basis for adjusting book profits for MAT purposes.

The Tribunal held that the assessee was indeed a developer, not merely a contractor, based on the risks, responsibilities, and financial involvement undertaken. Consequently, the claim for deduction under Section 80IA(4) was allowed.

The Tribunal held that since the CESTAT had deleted the additions proposed by the Excise Department, and the ITAT had previously directed fresh adjudication based on the CESTAT order, the additions sustained by the CIT(A) were liable to be set aside. The Tribunal also noted that additions were made on an estimated basis without rejecting the assessee's books of accounts.

The Tribunal held that the assessee was indeed a developer, not merely a contractor, based on the risks, responsibilities, and financial involvement undertaken. Consequently, the claim for deduction under Section 80IA(4) was allowed.