ITAT Ahmedabad Judgments — October 2022

The Tribunal held that interest earned by the assessee on surplus funds held with cooperative banks is eligible for deduction under Section 80P(2)(d) of the Act, following various High Court and ITAT decisions.

The Tribunal held that excess expenditure incurred by a trust for charitable purposes in an earlier year, when adjusted against the income of a subsequent year, is considered application of income in the year of adjustment. This principle is supported by multiple High Court and ITAT decisions.

The Tribunal held that the revenue should follow the rule of consistency, as it had accepted similar securities trading activities as business income in the preceding assessment year. Therefore, the loss should be treated as a business loss and not a short-term capital loss.

The Tribunal held that the Assessing Officer needs to verify if capital expenditure was claimed in earlier or current years. If not claimed, depreciation should be allowed after providing the assessee an opportunity to be heard.

The Tribunal held that the difference arose because the assessee deducted TDS on rent inclusive of service tax. The assessee had reconciled this with sufficient evidence, and the addition was not sustainable.

The Tribunal held that interest income earned by a co-operative society on surplus funds placed with another co-operative society is eligible for deduction under Section 80P(2)(d) of the Act.

The ITAT upheld the deletion of the addition, confirming that the property was purchased by the companies, not the individual assessee. The companies had disclosed the investment in their accounts, and merely mentioning the assessee's PAN due to him being a director did not make him the owner.

The Tribunal held that while the reopening was valid, the addition of 25% of purchases was excessive. Citing a previous year's decision in the assessee's own case and a jurisdictional High Court ruling, the Tribunal restricted the addition to 8% of the total sales.

The Tribunal held that the trading loss cannot be considered bogus solely based on a general modus operandi unearthed in other cases, without specific cogent material against the assessee. The CIT(A)'s deletion of the addition was upheld.

The Tribunal held that Section 145A(b) was not applicable for the assessment year 2009-10 as its effective date was April 1, 2010. Furthermore, following the jurisdictional High Court's decision, interest on enhanced compensation does not fall under the definition of 'interest' as contemplated in Section 145A.

The Tribunal held that the Assessing Officer and CIT(A) were justified in making the disallowance of loss. The reliance on the Investigation Report was deemed appropriate as the issue of client code modification is technical and requires expert investigation.

The Tribunal held that interest income from investments in nationalized banks is not eligible for deduction under Section 80P(2)(a)(i). However, interest income earned from deposits with a cooperative bank is eligible for deduction under Section 80P(2)(d).

The Tribunal noted the assessee's intention to resolve the issue under the Vivad Se Vishwas Scheme. The appeal was dismissed as the assessee opted for the scheme.

The Tribunal held that the assessment proceedings were pending at the time of registration under Section 12A, and therefore, the benefit of exemption under Section 11 should be extended to the assessee. The amendment to Section 12A(2) was considered applicable retrospectively.

The Tribunal found that neither the AO nor the CIT(A) had properly verified the evidence. Therefore, the order of the CIT(A) deleting the addition was set aside.

The Tribunal restored the issue to the CIT for one final opportunity, directing the assessee to appear and submit all required documents promptly. The CIT is to decide on merits if the assessee fails to comply.

The Tribunal held that the assessee had adequately explained the cash deposits of Rs. 4,07,000/- with cash books, referencing agricultural produce sales and commission earned from RSPL Ltd. Therefore, these could not be treated as unexplained cash credits under Section 68.

The Tribunal found that the CIT(A) did not consider the assessee's genuine reasons for the delay and did not decide the appeal on merits. The Tribunal also noted that the Assessing Officer did not consider the details filed during assessment.

The Tribunal held that the assessee had provided sufficient evidence to explain the source of cash deposits, including loans, gifts, and personal savings. Both the Assessing Officer and CIT(A) failed to consider the documentary evidence produced by the assessee.

The Tribunal held that the CIT(A) erred in dismissing the appeal without considering whether the rectification order was properly served on the assessee. Furthermore, the Tribunal found merit in the assessee's argument that the additions made were part of business expenses and not income from other sources.

The Tribunal held that the shares of Vas Infrastructure Limited were not categorized as 'penny stock' by SEBI at the time of the transaction. The assessee provided sufficient documentary evidence of genuine share trading, and the disallowance was based on conjecture.

The Tribunal held that the assessee was under a bonafide belief that as an agriculturist, he was not liable to file an income tax return. The penalty under Section 271F was therefore not sustainable.

The Tribunal held that the investor companies had declared the amounts as income under the Income Declaration Scheme, 2016, and disclosed their application as investments in the assessee companies. Since these declarations were accepted and taxes were paid, the nexus was established.

The Tribunal upheld the CIT(A)'s decision, finding that the assessee had provided sufficient evidence to explain the source of funds for both the mutual fund investment and the cash credits. The AO had erroneously treated the same amount twice.

The Tribunal held that the AO did not specify whether the penalty was for concealment or furnishing inaccurate particulars, and there was no specific material found during the search to substantiate these charges. The Tribunal also noted that the surrender was general and the claim of bogus expenses, while inaccurate, did not necessarily imply dishonest intent required for penalty.

The Tribunal held that an assessment framed in the name of a deceased person is void ab initio. Issuing a notice under Section 148 to a dead person renders the entire proceeding invalid.

The Tribunal held that the assessee had substantially complied with the requirements for constructing a residential house within the stipulated time, despite some delays. Therefore, the assessee was entitled to the exemption under Section 54 of the Act.

The Tribunal held that the mere crediting of an amount in the books, whether genuine or not, is not the sole test for determining if inaccurate particulars were furnished. Therefore, the penalty under Section 271(1)(c) was not sustainable.

The Tribunal condoned the delay in filing the appeal before the ITAT, considering the assessee's age and personal circumstances. It also set aside the ex-parte assessment order to the file of the AO for fresh adjudication.

The Tribunal held that the assessee had discharged their onus by submitting that the cash was from the sale of potatoes, and the authorities below had not doubted this trading activity. Therefore, the addition was unwarranted.

The Tribunal held that non-adherence to the jurisdictional High Court's judgment constituted a mistake apparent from the record. Therefore, the rectification application should have been allowed.

The Tribunal noted that the delay in filing Form 10 has since been condoned by the CIT(Exemption). Therefore, the Assessing Officer is directed to examine the assessee's claim on its merits.

The Tribunal held that the addition on account of director's remuneration was a change in the head of income by the AO and not concealment. Similarly, advances without interest were a business decision. Therefore, the penalty under Section 271(1)(c) was not sustainable.

The Tribunal allowed the appeal regarding disallowance under Section 14A, finding that the disallowance was not justified as the assessee had sufficient own funds and minimal exempt income. The penalty for delayed TDS return filing was also deleted due to reasonable cause and no loss to revenue.

The Tribunal held that the assessee should not be estopped from claiming the income as business income due to a bonafide mistake during assessment proceedings. Relying on precedent, it was decided that the lease charges constituted business income.

The Tribunal dismissed most of the Revenue's appeals, finding that issues raised had been decided in favor of the assessee by coordinate benches and confirmed by the High Court. One of the assessee's appeals was allowed, another partly allowed, and a penalty appeal was dismissed as infructuous.

The Tribunal allowed the appeal regarding disallowance under Section 14A, finding that the disallowance was not justified as the assessee had sufficient own funds and minimal exempt income. The penalty for delayed TDS return filing was also deleted due to reasonable cause and no loss to revenue.

The Tribunal dismissed most of the Revenue's appeals, finding that issues had been decided in favor of the assessee by coordinate benches and confirmed by the High Court. The assessee's appeal for AY 2002-03 was allowed, and another for AY 2003-04 was partly allowed. The penalty appeal was dismissed as infructuous.

The Tribunal allowed the appeal regarding disallowance under Section 14A, finding that the disallowance was not justified as the assessee had sufficient own funds and minimal exempt income. The penalty for delayed TDS return filing was also deleted due to reasonable cause and no loss to revenue.

The Tribunal allowed the appeal regarding disallowance under Section 14A, finding that the disallowance was not justified as the assessee had sufficient own funds and minimal exempt income. The penalty for delayed TDS return filing was also deleted due to reasonable cause and no loss to revenue.

The Tribunal allowed the appeal regarding disallowance under Section 14A, finding that the disallowance was not justified as the assessee had sufficient own funds and minimal exempt income. The penalty for delayed TDS return filing was also deleted due to reasonable cause and no loss to revenue.

The Tribunal partly allowed the assessee's appeal regarding Section 14A disallowance, finding it unjustified as the company had sufficient own funds and minimal exempt income. It also allowed the assessee's appeals concerning penalties for delayed TDS filings, citing reasonable cause and no loss to revenue.

The Tribunal allowed the appeal regarding disallowance under Section 14A, finding that the disallowance was not justified as the assessee had sufficient own funds and minimal exempt income. The penalty for delayed TDS return filing was also deleted due to reasonable cause and no loss to revenue.

The Tribunal dismissed most of the Revenue's appeals, finding that issues raised had been decided in favor of the assessee by coordinate benches and confirmed by the High Court. One of the assessee's appeals was allowed, another partly allowed, and a penalty appeal was dismissed as infructuous.

The Tribunal dismissed most of the Revenue's appeals, finding that issues raised had been decided in favor of the assessee by coordinate benches and confirmed by the High Court. One of the assessee's appeals was allowed, another partly allowed, and a penalty appeal was dismissed as infructuous.

The Tribunal allowed the appeal regarding disallowance under Section 14A, finding that the disallowance was not justified as the assessee had sufficient own funds and minimal exempt income. The penalty for delayed TDS return filing was also deleted due to reasonable cause and no loss to revenue.

The Tribunal dismissed most of the Revenue's appeals, finding that issues raised had been decided in favor of the assessee by coordinate benches and confirmed by the High Court. One of the assessee's appeals was allowed, another partly allowed, and a penalty appeal was dismissed as infructuous.

The Tribunal held that the absence of a valid notice under section 143(2) issued within the prescribed time makes the assessment order void ab initio. The provisions of section 292BB do not cure the complete absence of a notice.

The Tribunal held that the Rs. 11 crores was already offered to tax as 'other receipts' and disallowing expenses would lead to double taxation. Regarding interest expenses, the Tribunal noted that the cash credits were explained in a prior year's appeal, making the disallowance unsustainable.

The Tribunal held that if the difference between the DVO's valuation and the assessee's declared sale value is less than 15%, the assessee's declared value should be considered. The issue of cost of improvement was dismissed as it was not raised before the CIT(A), and the disallowance of interest expenses was upheld due to lack of evidence.