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102 orders · Page 2 of 3
The Tribunal condoned the delay in filing the appeals, finding sufficient cause due to the assessee's imprisonment and mental agony. Since the CIT(A) orders were ex-parte, the Tribunal remitted the entire issue back to the CIT(A) for fresh adjudication after providing a hearing opportunity.
The Tribunal condoned the delay in filing the appeals, finding sufficient cause due to the assessee's imprisonment and mental agony. Since the CIT(A) orders were ex-parte, the Tribunal remitted the entire issue back to the CIT(A) for fresh adjudication after providing a hearing opportunity.
The Tribunal condoned the delay in filing the appeals, finding sufficient cause due to the assessee's imprisonment and mental agony. Since the CIT(A) orders were ex-parte, the Tribunal remitted the entire issue back to the CIT(A) for fresh adjudication after providing a hearing opportunity.
The Tribunal condoned the delay in filing the appeals, finding sufficient cause due to the assessee's imprisonment and mental agony. Since the CIT(A) orders were ex-parte, the Tribunal remitted the entire issue back to the CIT(A) for fresh adjudication after providing a hearing opportunity.
The Tribunal condoned the delay in filing the appeals, finding sufficient cause due to the assessee's imprisonment and mental agony. Since the CIT(A) orders were ex-parte, the Tribunal remitted the entire issue back to the CIT(A) for fresh adjudication after providing a hearing opportunity.
The Tribunal held that the assessee is eligible for deduction under Section 80P(2)(d) for interest earned from investments in other co-operative banks. It also directed the AO to allow expenditure incurred in earning interest from commercial banks under 'Income from Other Sources'.
The Tribunal held that the receipts from the sale of software licenses and support services are not in the nature of royalty or FTS, following a Supreme Court judgment. The AO erred in treating these receipts as taxable income in India.
The Tribunal, while deprecating the assessee's non-compliance, restored the matter to the CIT(A) for fresh adjudication. The CIT(A) was directed to issue a fresh notice and consider the assessee's written submissions.
The Tribunal condoned the delay in filing the appeals, finding sufficient cause due to the assessee's imprisonment and mental agony. Since the CIT(A) orders were ex-parte, the Tribunal remitted the entire issue back to the CIT(A) for fresh adjudication after providing a hearing opportunity.
The Tribunal held that the proviso to Section 36(1)(iii) was not applicable. It found that the assessee had sufficient internal cash accruals from operations, which were more than the advances made to the sister concern.
The Tribunal held that AMP expenses do not constitute an international transaction without an express arrangement between the assessee and its Associated Enterprise (AE). It further noted that if the net profit margin of the manufacturing segment was at arm's length, no separate addition for AMP expenses was warranted.
The Tribunal held that M/s. Jeevan Scientific Technologies Ltd. should be excluded from the list of comparables for AY 2011-12. The Tribunal noted that the TPO had included income from both BPO operations (Rs. 79.21 lakhs) and the ERP segment (Rs. 92.93 lakhs) to arrive at a total of Rs. 172.14 lakhs, concluding that the BPO income exceeded Rs. 1 crore. However, the assessee argued that the Tribunal's earlier order directed exclusion if BPO operations turnover was less than Rs. 1 crore and that ERP services are not IT-enabled services as per CBDT instructions. The Tribunal found that the TPO's inclusion of ERP segment income was contrary to the specific direction to consider BPO operations turnover. The Tribunal directed the AO/TPO to exclude this company. For AY 2012-13, the Tribunal directed the exclusion of M/s. Universal Print Systems Ltd. from the list of comparables. The Tribunal observed that the TPO issued a notice under Section 133(6) but did not receive a reply. In the absence of complete information, the Tribunal held that TP adjustments could not be made reasonably or accurately. Therefore, following its own precedent, the Tribunal directed the exclusion of this company.
The Tribunal held that M/s. Jeevan Scientific Technologies Ltd. should be excluded from the list of comparables for AY 2011-12. The Tribunal noted that the TPO had included income from both BPO operations (Rs. 79.21 lakhs) and the ERP segment (Rs. 92.93 lakhs) to arrive at a total of Rs. 172.14 lakhs, concluding that the BPO income exceeded Rs. 1 crore. However, the assessee argued that the Tribunal's earlier order directed exclusion if BPO operations turnover was less than Rs. 1 crore and that ERP services are not IT-enabled services as per CBDT instructions. The Tribunal found that the TPO's inclusion of ERP segment income was contrary to the specific direction to consider BPO operations turnover. The Tribunal directed the AO/TPO to exclude this company. For AY 2012-13, the Tribunal directed the exclusion of M/s. Universal Print Systems Ltd. from the list of comparables. The Tribunal observed that the TPO issued a notice under Section 133(6) but did not receive a reply. In the absence of complete information, the Tribunal held that TP adjustments could not be made reasonably or accurately. Therefore, following its own precedent, the Tribunal directed the exclusion of this company.
The Tribunal held that the assessee should be considered a routine software development services provider, not an R&D company. It reasoned that while the assessee possessed infrastructure and qualified employees, the intangible arising from research was owned by the AE (Open Silicon Inc.) as per the agreement. The entire project and technology risks were borne by the AE, with the assessee only undertaking manpower risk. The Tribunal noted that the assessee was remunerated at cost plus markup, and Rule 10TA of the IT Rules, defining R&D services, did not preclude software development from being considered R&D. However, the facts indicated the assessee was a captive service provider rendering services as per the AE's requirements. Regarding the comparable E-Infochips Ltd., the Tribunal, following its coordinate bench decisions for AY 2011-12, directed its exclusion. It noted that this company consistently failed the service income filter of 7.5% (sic, likely meant 75%) and that other factual dissimilarities considered by the DRP, such as lack of segmental information and extraordinary events, were not disputed by the revenue. Therefore, the appeal was allowed on this limited issue.
The Tribunal held that the reimbursement made by the assessee to overseas entities towards seconded employees cannot be regarded as 'Fee For Technical Services'. It reasoned that the employer-employee relationship exists between the assessee and the seconded personnel, and the method of salary disbursement does not determine the nature of the transaction. The Tribunal relied on decisions like Volkswagen India Pvt. Ltd. vs. CCE, Pune-I, and various High Court and Tribunal rulings. Consequently, it directed the AO to delete the disallowance under Section 40(a)(i) and any interest levied under Section 201(1A). Regarding transfer pricing, the Tribunal remitted the issue of expat salary verification back to the AO. For other transfer pricing grounds, it directed the AO to follow the decision of the Hon’ble Mumbai Special Bench in DCIT vs. Total Oil India Pvt. Ltd. The appeal was allowed on the issues argued.
The Tribunal deleted the adjustment made by the TPO towards technical know-how fees, stating that it was impractical to disallow it when entity-level margins were accepted. It also held that Section 40(a)(i) was not applicable to depreciation claimed on capitalized payments.
The Tribunal, after considering the rival submissions and the materials on record, noted that similar issues have come up for consideration in the assessee's own case for earlier assessment years. Specifically, for AY 2005-06 & 2006-07, the Tribunal had directed that if a comparable is not found for royalty payment, the TPO/AO should consider the royalty payment as part of the international transaction under the trading segment and determine the Arm's Length Price (ALP) by considering the royalty as part of the operating cost for computing the margin in the trading segment. The Tribunal observed that the TPO in the impugned year had neither found a comparable nor considered royalty as part of the international transaction in the trading segment, thus failing to adhere to the directions of the ITAT. Furthermore, the Tribunal noted that for AY 2002-03 to 2004-05, the AO had deleted the adjustment on Royalty, and for AY 2012-13 and AY 2016-17, the Tribunal had followed the earlier orders. In view of this consistent position and the failure of the lower authorities to follow the directions, the Tribunal decided to remit the issue to the file of the AO/TPO for reconsideration on similar lines as directed in earlier years. The ground of appeal was accordingly partly allowed.
The Tribunal held that interest income earned on surplus funds invested in cooperative and commercial banks is not eligible for deduction under Section 80P(2)(d) as it does not arise from the society's primary business operations. The issue of other receipts was remitted to the AO for fresh consideration.
The Tribunal, while deprecating the assessee's non-appearance, granted one more opportunity in the interest of justice and equity as the matter was decided ex parte without merits. The appeal was remitted to the CIT(A).
The Tribunal held that the revenue from maintenance and support services is not taxable as FTS in India. The Tribunal noted that the services rendered by the assessee were general training to improve the soft skills of the end-users' employees in using the software licensed. This support did not involve the transfer of technology or knowledge that would be 'made available' to the recipient for their future independent use without the assessee's aid. The Tribunal relied on the Supreme Court's decision in GE India Technology Cen. (P) Ltd. vs. CIT and an Ahmedabad Tribunal decision in ITO vs. Veeda Clinical Research (P) Ltd. It was also observed that the assessee had no Permanent Establishment (PE) in India, meaning the income could not be taxed as business income under Article 7 read with Article 5 of the DTAA. Consequently, the addition made by the AO was directed to be deleted. Regarding the interest under Section 244A, the Tribunal directed the AO to compute it in accordance with the law. Grounds 2 and 3 were allowed, and Ground 4 was rendered infructuous. Ground 5 was consequential.
On the issue of disallowance under section 14A, the Tribunal directed the AO to verify whether investments in joint ventures and domestic companies that had not yielded any dividend income for the year under consideration should be excluded for the purpose of computing the average value of investments and the disallowance under section 14A read with Rule 8D. The AO was instructed to follow the decision of the Special Bench of the ITAT in ACIT v Vireet Investment P Ltd. This implies a partial allowance or remand on this issue pending verification. Regarding the disallowance of foreign tax credit (FTC), the Tribunal held that the AO exceeded jurisdiction by considering this issue, as it was not a subject matter of appeal before the Tribunal in the first round and had attained finality. The Tribunal deleted the impugned disallowance of FTC, allowing the assessee's ground. The Tribunal also directed the AO to verify Form 26AS for TDS and advance tax credit and to compute the tax liability accordingly.
The Tribunal held that the assessee failed to provide sufficient cause for the inordinate delay in filing the appeals. The Tribunal relied on various High Court and ITAT decisions emphasizing that ignorance of law or vague reasons are not acceptable for condoning delay.
The Tribunal held that the assessee failed to provide sufficient cause for the inordinate delay in filing the appeals. The explanation of inadequate advice was considered vague and not a valid reason for such a long delay.
The Tribunal noted that the assessee had raised grounds concerning the invalidity of the assessment due to the non-service of the mandatory notice under Section 143(2). The Tribunal's order focuses on this procedural defect.
The Tribunal, considering the assessee's plea for another opportunity and the fact that the AO made additions of the entire expenditure and liabilities without allowing any benefit, decided to remit the appeal back to the AO for de novo assessment.
The Tribunal held that the filing of Form No. 67 is a directory and not a mandatory requirement. Therefore, belated filing does not extinguish the substantive right to claim FTC.
The Tribunal held that the land was indeed stock-in-trade and the expenditure incurred was revenue in nature, allowing the assessee's ground on this issue. However, it upheld the CIT(Appeals)'s decision to treat interest income from fixed deposits as income from other sources.
The Tribunal held that the assessee is not eligible for deduction under Section 80P(2)(a)(i) or 80P(2)(d) on interest received from co-operative banks. However, it directed the AO to allow deduction of proportionate expenses incurred for earning such interest income under Section 57.
The Tribunal held that the land was indeed stock-in-trade and the expenditure incurred was revenue in nature, allowing the assessee's ground on this issue. However, it upheld the CIT(Appeals)'s decision to treat interest income from fixed deposits as income from other sources.
The Tribunal held that the assessee is not eligible for deduction under Section 80P(2)(a)(i) or 80P(2)(d) on interest received from co-operative banks. However, it directed the AO to allow deduction of proportionate expenses incurred for earning such interest income under Section 57.
The Tribunal held that depreciation on plant and machinery (Scan Emulator Pod and starter kit) should be allowed as usage could not be doubted. However, for other assets like software tools, computers, vehicles, and office equipment, the disallowance of depreciation was upheld due to insufficient evidence of usage and installation.
The Tribunal noted that the AO had not verified the cash book and confirmations provided by the assessee. It directed the AO to verify all details and evidence submitted by the assessee in light of CBDT circulars concerning demonetisation deposits, granting the assessee an opportunity to be heard.
The Tribunal condoned the delay in filing the appeal before the CIT(A), stating that substantial justice should be preferred over technicalities. The appeal was remanded to the CIT(A) to decide the matter on merits after granting a proper opportunity of being heard.
The Tribunal noted that the grounds raised by the assessee were not entirely proper and that documentary evidence was lacking. However, in the interest of justice, the Tribunal decided to provide the assessee with another opportunity to present its case.
The Tribunal remanded the issue back to the Assessing Officer to re-examine the claims, considering the possibility that the tax consultant was solely responsible for the fraudulent claims and the assessee acted bonafide.
The Tribunal remanded the issue back to the Assessing Officer to re-examine the claims, considering the possibility that the tax consultant was solely responsible for the fraudulent claims and the assessee acted bonafide.
The Tribunal decided the issues as follows: Regarding Ground No. 17 (working capital adjustment), the Tribunal found merit in the assessee's claim and allowed the ground, remitting the issue to the AO/TPO for consideration in accordance with law. This ground was allowed for statistical purposes. Regarding Grounds 19-23 (notional interest on outstanding receivables), the Tribunal noted the assessee's submission that receivables were settled on an ongoing basis and subsumed in the primary transaction's ALP. The assessee also argued that receivables are not international transactions under Section 92B and that working capital adjustments subsume sundry creditors, preventing double taxation. The Tribunal, referencing decisions from the Special Bench of ITAT in 'Instrumentation Corpn. Ltd.' and the Delhi Tribunal in 'Orange Business Services India Solutions Pvt. Ltd.', and the Delhi High Court in 'Avenue Asia Advisors Pvt. Ltd.', held that outstanding sums are akin to loans and an international transaction. However, it also acknowledged that working capital adjustments might subsume receivables, leading to potential double taxation. Consequently, the Tribunal set aside the impugned order on this issue and remitted it to the AO/TPO. It directed that if working capital adjustment subsumes outstanding receivables, no separate characterization is to be made. For receivables falling outside WCA, interest should be charged at LIBOR + 300 basis points with a 90-day credit period, as per 'CIT vs. Cotton Naturals (I) Pvt. Ltd.'. These grounds were partly allowed for statistical purposes. Regarding Grounds 24-25 (short grant of TDS and interest u/s. 234C), the Tribunal directed the AO to grant credit of TDS after verification and to levy interest under Section 234C on the returned income as mandated. These grounds were allowed for statistical purposes. The Tribunal did not explicitly decide all the grounds raised by the assessee, particularly those related to the selection and rejection of comparable companies and the computation of transfer pricing adjustments for the software development and trading segments, as the matter was remanded for further consideration on specific aspects.
The Tribunal held that the reimbursement of salary expenses for seconded employees does not constitute Fees for Technical Services (FTS) under the Act and the India-US Tax Treaty. It was also held that the assessee cannot be held in default for non-deduction of TDS as there was no violation of Section 195.
The Tribunal remanded the issue back to the Assessing Officer to re-examine the claims, considering the possibility that the tax consultant was solely responsible for the fraudulent claims and the assessee acted bonafide.
The Tribunal decided to remit the issue of including capital expenditures in TP adjustments back to the AO/TPO for re-examination. For the issue of the Profit Level Indicator, the Tribunal allowed the assessee's ground, following its own previous decision.
The Tribunal held that payments for software licenses, as per the Supreme Court's decision in Engineering Analysis Centre of Excellence Pvt. Ltd., do not constitute royalty. Consequently, the addition made by the AO on this account was directed to be deleted.
The Tribunal held that payments for software licenses, as per the Supreme Court's decision in Engineering Analysis Centre of Excellence Pvt. Ltd., do not constitute royalty. Consequently, the addition made by the AO on this account was directed to be deleted.
The Tribunal found that the assessee could not adequately explain the cash sales and lacked necessary documentation like the cash book and daily stock position. Therefore, the matter was remitted back to the AO for further verification.
The Tribunal held that the penalty order was invalid as it was passed on a deceased person. Proceedings initiated against a deceased person must be continued against their legal representative, and passing an order in the name of the deceased is a nullity.
The Tribunal held that disallowance under Section 143(1) for employee contributions is permissible. It remitted a portion of the disallowance for verification of payment dates and sustained another portion based on the Supreme Court's decision in Checkmate Services.
The Tribunal held that the Assessing Officer failed to understand the nature of the assessee's business, where agents were appointed to execute sales orders in remote locations, involving statutory compliance and storage. The commission paid was for these services, not for procuring orders through tenders.
The Tribunal held that the Assessing Officer failed to understand the nature of the assessee's business, where agents were appointed to execute sales orders in remote locations, involving statutory compliance and storage. The commission paid was for these services, not for procuring orders through tenders.
The Tribunal considered the request of the assessee's Authorized Representative (A.R.) to dismiss the appeal as not pressed. The A.R. had submitted a letter dated 20.4.2023, indicating the assessee's intention not to pursue the appeal. The Tribunal, acknowledging this request, decided to dismiss the appeal. The reasoning is based on the assessee's explicit wish to withdraw from the proceedings. Therefore, the Tribunal found no necessity to adjudicate on the merits of the assessment order. The operative direction is the dismissal of the assessee's appeal.
The Tribunal held that ESOP expenses are an allowable deduction. This decision was based on the Tribunal's own previous ruling for a different assessment year with identical facts.
The Tribunal noted that the initial disallowance was based on the tax audit report. However, the assessee provided a CA's certificate indicating partial timely deposits. The Tribunal decided to remit the issue to the AO for verification.