ITAT Amritsar Judgments — June 2018

The Tribunal held that the assessee was provided with opportunities to be heard but failed to avail them. While some grounds were dismissed, others were partly allowed with directions for further verification.

The Tribunal held that since the borrowed capital was used for business assets and the non-business advances were funded from the assessee's interest-free capital, no disallowance of interest expenses was warranted. The Tribunal directed the deletion of the disallowance.

The Tribunal upheld the deletion of disallowances, finding that the assessee had sufficient interest-free funds to cover the interest-free advances. The loans were also considered to be given out of commercial expediency.

The Tribunal held that since the borrowed capital was used for business assets and the non-business advances were funded from the assessee's interest-free capital, no disallowance of interest expenses was warranted. The Tribunal directed the deletion of the disallowance.

The Tribunal upheld the deletion of disallowances, finding that the assessee had sufficient interest-free funds to cover the interest-free advances. The loans were also considered to be given out of commercial expediency.

The Tribunal held that the cash deposit in the Axis Bank account belonged to the assessee's father, Sadhu Singh, who deposited it into his joint account. The CIT(A) correctly considered the agreement to sell and the subsequent sale deed, finding no case against the assessee.

The Tribunal held that the assessee had indeed raised objections regarding the initiation of reassessment proceedings under Section 147 by a letter dated 25.03.2015. It was observed that neither the Assessing Officer nor the CIT(A) had addressed or adjudicated these objections. The Tribunal noted the Supreme Court's decision in GKN Driveshafts (India) Ltd. v. Income-Tax Officer and Ors. (2003) 259 ITR 19, which mandates that on receipt of objections to a notice under Section 148, the Assessing Officer is bound to dispose of them by passing a speaking order before proceeding with the assessment. While acknowledging the Revenue's reliance on M/s Home Finders Housing Ltd. to argue that non-compliance does not make the order void ab initio, the Tribunal found that in the present case, no speaking order was passed by the AO, and he directly proceeded to pass the reassessment order, which was contrary to the Apex Court's directions. Therefore, the Tribunal set aside the impugned order of the CIT(A) and restored the matter to the file of the Assessing Officer with a direction to dispose of the assessee's objections by passing a speaking order and thereafter proceed with the reassessment proceedings, if required, as per law. The Tribunal allowed the appeal for statistical purposes, effectively remanding the issue of the validity of reassessment proceedings back to the AO for proper adjudication.

The Tribunal upheld the deletion of disallowances, finding that the assessee had sufficient interest-free funds to cover the interest-free advances. The loans were also considered to be given out of commercial expediency.

The Tribunal upheld the deletion of disallowances, finding that the assessee had sufficient interest-free funds to cover the interest-free advances. The loans were also considered to be given out of commercial expediency.

The Tribunal held that while the High Court judgment relied upon by the CIT(A) was recalled, the assessee's argument of separate management and accounting for each liquor vend had merit. Payments made by each vend to suppliers should be considered separately for the purpose of Section 40A(3)/(3A).