ITAT Bangalore Judgments — January 2022

The Tribunal admitted additional evidence and remitted the matter to the AO for fresh consideration, allowing the assessee's grounds related to the admission of evidence. The issue regarding Form 26AS differences was partly allowed, remitting it to the AO for re-adjudication.

The Tribunal held that the PCIT was not justified in initiating revision proceedings regarding the estimation of income from civil contract works, as the AO had taken a plausible view. However, the Tribunal found no reason to interfere with the PCIT's observations regarding the dropping of penalty proceedings under Section 271A.

The Tribunal held that the disallowance was incorrect as the payment was made within the due date for filing the return of income under Section 139(1) of the Income Tax Act. Amendments made by the Finance Act, 2021, were not applicable retrospectively.

The Tribunal held that the cross objections filed by the assessee were not maintainable and dismissed them. For the quantum appeal, the Tribunal allowed the Revenue's appeal to the extent remanded by the High Court. For the penalty appeal, the Tribunal restored the penalty order for two specific additions that survived the quantum proceedings.

The Tribunal held that the cross objections filed by the assessee were not maintainable and dismissed them. For the quantum appeal, the Tribunal allowed the Revenue's appeal to the extent remanded by the High Court. For the penalty appeal, the Tribunal restored the penalty order for two specific additions that survived the quantum proceedings.

The Tribunal held that the cross objections filed by the assessee were not maintainable and dismissed them. For the quantum appeal, the Tribunal allowed the Revenue's appeal to the extent remanded by the High Court. For the penalty appeal, the Tribunal restored the penalty order for two specific additions that survived the quantum proceedings.

The Tribunal restored the cases to the AO to verify if income assessed for AY 2012-2015 was also assessed in AY 2017-18 under the project completion method. If so, the 12% estimation for the earlier years is to be deleted.

The Tribunal held that the amendment to Section 36(1)(va) and 43B by the Finance Act, 2021, is prospective and does not apply to the assessment year 2018-19. The assessee is entitled to deduction if payment is made before the due date of filing the return of income.

The Tribunal deleted the disallowance of broadband charges. It also deleted the disallowance of depreciation on software purchases under Section 40(a)(ia) but restored the issue of treating software purchases as revenue expenditure for fresh examination. The revenue's grounds regarding risk adjustment and Section 10A computation were dismissed.

The Tribunal held that the Resale Price Method (RPM) is the most appropriate method for benchmarking the transactions, rejecting the Transactional Net Margin Method (TNMM) used by the revenue. It also directed the AO/TPO to verify the gross margin under RPM and consider the actual purchase figure.

The Tribunal held that the foreign exchange loss on the restatement of the EEFC account is revenue in nature and notional, thus allowing it as a deduction. The Tribunal upheld the CIT(A)'s directions regarding the verification of TDS and depreciation on leased assets, as these were for protecting revenue interests.

The Tribunal restored the cases to the AO to verify if income assessed for AY 2012-2015 was also assessed in AY 2017-18 under the project completion method. If so, the 12% estimation for the earlier years is to be deleted.

The Tribunal held that the expenditure incurred for social development, made at the request of local administration and with a view to secure business benefit and goodwill, qualifies as business expenditure under Section 37(1). Therefore, the disallowance made by the authorities below is set aside.

The Tribunal deleted the disallowance of broadband charges. It also deleted the disallowance of depreciation on software purchases under Section 40(a)(ia) but restored the issue of treating software purchases as revenue expenditure for fresh examination. The revenue's grounds regarding risk adjustment and Section 10A computation were dismissed.

The Tribunal restored the cases to the AO to verify if income assessed for AY 2012-2015 was also assessed in AY 2017-18 under the project completion method. If so, the 12% estimation for the earlier years is to be deleted.

The Tribunal held that the foreign exchange loss on the restatement of the EEFC account is revenue in nature and notional, thus allowing it as a deduction. The Tribunal upheld the CIT(A)'s directions regarding the verification of TDS and depreciation on leased assets, as these were for protecting revenue interests.

The Tribunal admitted additional evidence filed by the assessee and, for substantial justice, restored the entire issue to the Assessing Officer for de novo consideration. Both the assessee's and Revenue's appeals were allowed for statistical purposes.

The Tribunal held that the CIT(A) erred in denying exemption without affording the assessee an opportunity to explain the alleged violations of sections 13(2)(a) and 13(2)(b). Therefore, the case was restored to the AO for de novo consideration.

The Tribunal held that the amount paid by the assessee to obtain club membership is revenue expenditure, following the jurisdictional High Court's decision in CIT vs. Infosys Technologies Ltd. Therefore, the disallowance made by the lower authorities was incorrect.

The Tribunal held that if the employees' contribution to PF and ESI is remitted before the due date for filing the return of income under Section 139(1), it cannot be disallowed. The amendment brought by the Finance Act, 2021, is not applicable retrospectively.

The Tribunal held that a statement recorded during a survey under Section 133A, without corroborative material, has no evidentiary value for making additions. The CIT(A)'s deletion of additions based on such statements and his findings on other grounds were upheld.

The Tribunal noted that the assessee's previous claims were incorrect and that the budget preparation involved considering actual expenses and receipts. Given that this fact was not brought to the AO's notice, the Tribunal granted an opportunity for proper representation.

The Tribunal held that the expenditure on application software, which enhances productivity and efficiency without touching the profit-making apparatus, is revenue in nature. The perpetual nature of the license does not automatically make the expenditure capital.

The Tribunal admitted additional evidence filed by the assessee and, for substantial justice, restored the entire issue to the Assessing Officer for de novo consideration. Both the assessee's and Revenue's appeals were allowed for statistical purposes.

The Tribunal noted that the issues contested in the appeal have been settled under the Vivad se Vishwas Act. Therefore, the appeal was dismissed as withdrawn.

The Tribunal found that the facts on record were insufficient to ascertain the correct position and directed the Assessing Officer to conduct fresh verification for both issues. The assessee was instructed to provide all necessary details.

The Tribunal held that the expenditure on application software, which enhances productivity and efficiency without touching the profit-making apparatus, is revenue in nature. The perpetual nature of the license does not automatically make the expenditure capital.

The Tribunal followed a previous similar ruling and remitted the issue back to the Assessing Officer for proper inquiry. The AO is directed to investigate the deemed income after providing the assessee with an opportunity to be heard.

The Tribunal directed the Assessing Officer to re-examine whether BCCI had Section 12AA registration for the relevant year, as this would preclude taxation under Section 56(2)(vii). The Tribunal also noted that Section 28(iv) might not apply to a retired cricketer and that the assessee was not given adequate notice for this alternative ground.

The Tribunal restored the issue of modifications made to the new asset to the AO for re-examination, directing the AO to afford the assessee an opportunity of hearing. The Tribunal confirmed the disallowance of brokerage paid for the purchase of the new asset due to lack of proper substantiation.

The Tribunal held that the Assessing Officer had considered the revised computation of loss, making the ground regarding the revised return misconceived. The liability for wage revision and audit fees had crystalized and was allowable as a deduction.

The Tribunal found that the facts on record were insufficient to ascertain the correct position and directed the Assessing Officer to conduct fresh verification for both issues. The assessee was instructed to provide all necessary details.