ITAT Ahmedabad Judgments — July 2022

The Tribunal held that the Assessing Officer and CIT(A) were not justified in treating the LTCG as bogus. The transactions were supported by documentary evidence and conducted through banking channels, and the revenue failed to prove any cash trail or specific implication of the assessee in a scam.

The Tribunal held that the CIT(A) failed to consider the assessee's written submissions and violated the principle of natural justice. Therefore, the matter was set aside and remitted back to the CIT(A) for a fresh disposal.

The Tribunal upheld the rejection of the books of accounts and the estimated profit rate. However, it directed that depreciation, partner's remuneration, and interest on capital should be allowed as deductions against the estimated profit.

The Tribunal upheld the rejection of the books of accounts and the estimated profit rate. However, it directed that depreciation, partner's remuneration, and interest on capital should be allowed as deductions against the estimated profit.

The tribunal condoned the delay in filing the appeals and decided to give the assessee a further opportunity to substantiate claims regarding cash deposits, foreign payments, and rent payments by remitting these issues back to the AO. However, the ground related to disallowance of ticketing and travelling expenses was dismissed.

The tribunal allowed the assessee's request to withdraw the appeal. The appeal was dismissed as withdrawn because the consequential assessment proceedings were dropped by the Assessing Officer.

The Tribunal held that substantial compliance by furnishing the audit report in physical form before the CIT(A) is sufficient. The benefit of exemption under section 11 should not be denied solely for not filing the report electronically.

The Tribunal held that the reassessment proceedings were initiated on a mere change of opinion, as all relevant information was available to the AO during the original assessment. The AO does not have the power to review his earlier order under Section 147.

The Tribunal held that once a validation certificate was issued for the IDS declaration, the reassessment order and the CIT(A)'s order lacked merit. The late payment of the installment was effectively condoned by the subsequent validation.

The Tribunal dismissed the Revenue's appeal regarding depreciation, upholding the CIT(A)'s decision. However, for the admission fees issue, the Tribunal found that the receipts for the current year did not explicitly mention corpus donation, unlike in prior years, and thus remanded the matter to the AO for fresh examination.

The Tribunal held that the CIT(A) should not have dismissed the ground regarding excess interest charged under Section 234D merely because an alternative remedy of rectification was available. The issue was restored to the CIT(A) for fresh adjudication.

The tribunal condoned the delay in filing the appeals and decided to give the assessee a further opportunity to substantiate claims regarding cash deposits, foreign payments, and rent payments by remitting these issues back to the AO. However, the ground related to disallowance of ticketing and travelling expenses was dismissed.

The tribunal condoned the delay in filing the appeals and decided to give the assessee a further opportunity to substantiate claims regarding cash deposits, foreign payments, and rent payments by remitting these issues back to the AO. However, the ground related to disallowance of ticketing and travelling expenses was dismissed.

The Tribunal held that generating electricity is a manufacturing activity and thus eligible for additional depreciation. Regarding book profits, it was held that disallowances under Section 14A cannot be applied to Section 115JB, but an ad-hoc disallowance of 1% of exempted income was directed.

The Tribunal held that the penalty under Section 271G is unsustainable as the assessee had physically filed the revised Form 3CEB and had provided all requested information to the Transfer Pricing Officer. The CIT(A) had rightly allowed the assessee's appeal.

The tribunal condoned the delay in filing the appeals and decided to give the assessee a further opportunity to substantiate claims regarding cash deposits, foreign payments, and rent payments by remitting these issues back to the AO. However, the ground related to disallowance of ticketing and travelling expenses was dismissed.

The Tribunal condoned the delay in filing the appeal, considering the assessee's age and the plausible reason provided for the delay. The matter was then remanded to the CIT(A) to decide the appeal on its merits, specifically to verify if the remuneration addition was already accounted for by the assessee.

The Tribunal upheld the CIT(A)'s decision to delete the disallowance of promotion expenses, finding them to be for business purposes and not in violation of regulations. The Tribunal also dismissed the Revenue's grounds concerning Section 80IC, expenses outside the approved facility, depreciation, and foreign commission expenses.

The Tribunal held that a draft sale deed, which was unsigned and not corroborated, cannot be relied upon. Admissions made by a third party before the Settlement Commission cannot be used against the assessee without proper confrontation.

The Tribunal upheld the CIT(A)'s decision to delete the disallowance of promotion expenses, finding them to be for business purposes and not in violation of regulations. The Tribunal also dismissed the Revenue's grounds concerning Section 80IC, expenses outside the approved facility, depreciation, and foreign commission expenses.

The tribunal noted that a moratorium has been declared under Section 14 of the Insolvency and Bankruptcy Code, 2016, which prohibits the continuation of pending suits or proceedings against the corporate debtor. Therefore, the appeal cannot proceed.

The Tribunal upheld the addition of Rs. 11,97,000/- as unexplained cash deposits. The assessee's explanation regarding recovery from a food project was not supported by any evidence, and Section 68 of the Income-tax Act mandates satisfactory explanation for credited sums.

The Tribunal held that the revision proceedings initiated by the Principal CIT were unjustified as the assessee had furnished all required details during the original assessment. The additions made by the Assessing Officer pursuant to the revision were also deleted by the CIT(A).

The Tribunal directed the AO to re-examine the proportionate grant relating to different assets. Regarding prior period expenses, the Tribunal directed the AO to verify actual payments and allow deduction if found correct, while also noting that if prior period provisions were disallowed earlier and actual payments were made, it could be allowed as a deduction.

The Tribunal found that the lower authorities did not properly consider the assessee's submission that the property was purchased by her husband. Therefore, the issue was remitted back to the AO for fresh consideration.

The Tribunal held that the assessee cannot be denied the deduction based on the subsequent cancellation of the trust's registration, especially when there was no evidence that the donation was returned to the assessee. The Tribunal followed a co-ordinate bench's decision in a similar group case.

The Tribunal directed the AO to re-examine the proportionate grant amount related to specific assets. Regarding prior period expenses, the AO was directed to verify actual payments and allow them as deductions if found correct, subject to ITAT's decision on earlier years.

The Tribunal directed the AO to re-examine the proportionate grant relating to different assets. Regarding prior period expenses, the Tribunal directed the AO to verify actual payments and allow deduction if found correct, while also noting that if prior period provisions were disallowed earlier and actual payments were made, it could be allowed as a deduction.

The Tribunal held that the expenditure on rolling mill rolls, used as consumables and requiring frequent replacement due to wear and tear, constitutes revenue expenditure. The rate of depreciation prescribed in the Income Tax Rules does not determine the nature of the expenditure.

The Tribunal held that the AO rightly invoked Rule 8D for disallowance of expenditure related to dividend income, as the assessee's plea of no expenditure was incorrect due to investment purchase and sale activities. The disallowance was confirmed as per Rule 8D(2)(iii).

The Tribunal held that the issue regarding late payment of PF contribution had already been decided against the assessee by the jurisdictional High Court. Therefore, the appeal had no merit.

The Tribunal directed the AO to re-examine the proportionate grant relating to different assets. Regarding prior period expenses, the Tribunal directed the AO to verify actual payments and allow deduction if found correct, while also noting that if prior period provisions were disallowed earlier and actual payments were made, it could be allowed as a deduction.

The Tribunal held that the assessee, being a non-resident, earned income outside India, which is not taxable in India under Section 5(2) of the Income Tax Act. Therefore, the addition made under Section 69A as unexplained investment was incorrect.

The Tribunal held that the interest income earned on surplus funds before the commencement of business operations should be treated as a capital receipt. This income is inextricably linked to the setting up of the capital structure and should be set off against pre-operative expenses.

The Tribunal held that the assessee failed to establish the creditworthiness of the lender and the genuineness of the transaction. The statement of the creditor raised serious doubts, and thus the assessee did not discharge the onus cast upon it under Section 68.

The Tribunal held that unabsorbed business losses can be set off against speculative business income as per Section 72(1)(i) of the Act, and the AO's reliance on other cases was misplaced. The addition of Rs. 18,000 was deleted as the assessee provided a reasonable explanation for non-service of notice and cooperated with the revenue.

The Tribunal held that the disallowance of late payment of Employees' ESI contribution is justified, following the decisions of the jurisdictional High Court. The appeal was dismissed.

The Tribunal held that in the interest of justice, the issues should be remanded back to the CIT(A) for proper adjudication. The assessee must be given an opportunity of hearing.

The Tribunal held that approval for gratuity fund is required and remanded the issue to the Assessing Officer for verification. It also held that 50% of pooja expenses and employee welfare expenses are not includible in fringe benefit tax.

The Tribunal held that Section 56(2)(viib) allows for multiple methods of determining the fair market value of shares, not just those prescribed in Rule 11UA. The AO's rejection of the assessee's valuation report solely on the basis of not adhering to a specific rule was not in accordance with the law.

The Tribunal upheld the CIT(A)'s order, following the jurisdictional High Court's decision that Section 50C is applicable only to the seller and not the purchaser. There was no evidence of the assessee paying more than what was recorded in the sale deed.

The Tribunal upheld the CIT(A)'s decision to delete the penalty for loans amounting to Rs. 1,20,54,566/- as they were routed through banking channels and recorded via journal entries, not constituting cash transactions. However, a penalty for a Rs. 1,00,000/- cash loan was acknowledged as a contravention.

The Tribunal held that the revision proceedings initiated by the Principal CIT were unjustified as the assessee had furnished all required details during the original assessment. The additions made by the Assessing Officer pursuant to the revision were also deleted by the CIT(A).

The Tribunal upheld the Commissioner's decision to reject the application for registration under Section 12AA. The assessee failed to provide necessary documents and evidence to establish the genuineness of its activities, even before the Tribunal.

The Tribunal noted that the assessment order lacked discussion on the disallowance and the CIT(A) did not provide a proper opportunity to the assessee. Considering a press release regarding a grace period for deposits, the Tribunal decided to remit the matter back to the Assessing Officer for verification.

The Tribunal held that since the bills for sales promotion expenses were found to be bogus and there was no evidence of distribution of gifts, the entire expenses should be disallowed. The CIT(A)'s restriction of disallowance to 12.5% was deemed flawed and unsustainable.

The Tribunal held that since the bills for sales promotion expenses were found to be bogus and there was no evidence of distribution of gifts, the entire expenses should be disallowed. The CIT(A)'s restriction of disallowance to 12.5% was deemed flawed and unsustainable.

The Tribunal dismissed the assessee's grounds regarding deferred revenue expenditure and miscellaneous losses. It partly allowed the appeal concerning capital grants and subsidies by remitting the issue to the AO. The appeals by the Revenue were dismissed.

The Tribunal dismissed the assessee's grounds regarding deferred revenue expenditure and miscellaneous losses. It partly allowed the appeal concerning capital grants and subsidies by remitting the issue to the AO. The appeals by the Revenue were dismissed.