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53 orders · Page 1 of 2
The Tribunal allowed the appeal in favour of the assessee. For the issue of software license receipts being treated as royalty, the Tribunal followed its own order in the assessee's case for AY 2014-15 and the Supreme Court's decision in Engineering Analysis Centre of Excellence (P.) Ltd. It held that the terms of the license agreement do not grant proprietary interest or part with copyright, and therefore, payments for such licenses are not in the nature of royalty as defined in the DTAA. Similarly, for receipts on account of support services being treated as FTS, the Tribunal followed its earlier decision and held that these sums cannot be brought to tax as FTS, as the 'make available' clause under the DTAA was not satisfied. The Tribunal also directed that an amount inadvertently offered to tax by the assessee, which was found to be not taxable, should not be taxed, citing Article 265 of the Constitution and the principle that tax can only be levied by authority of law.
The Tribunal allowed the appeal in favour of the assessee. It noted that for A.Y. 2014-15 and preceding years, the Tribunal had considered identical issues on similar facts and concluded that the software license receipts were not royalty, as the terms of the license did not grant proprietary interest or parting of copyright, merely enabling the use of the copyrighted product. This was found to be similar to the Supreme Court's analysis in Engineering Analysis Centre of Excellence (P.) Ltd. The Tribunal also held that receipts on account of rendering support services could not be taxed as FTS, as these services did not 'make available' technical know-how to the Indian customers, a condition under the DTAA. The Tribunal followed its own prior decisions and the Supreme Court's ruling, directing the deletion of the addition made by the AO. Grounds related to consequential and general matters were also disposed of accordingly. The petition for admission of additional grounds was dismissed as infructuous.
The Tribunal held that the issuance of notice under Section 153C instead of 153A was a curable defect under Section 292B, as the assessee had participated in the proceedings. The additions made by the AO were sustained, including those related to partnership assets and property valuation.
The Tribunal held that the AO and CIT(A) erred in treating the acceptance of Specified Bank Notes (SBNs) before the appointed day as prohibited and adding them under Section 69A. However, the AO had not examined the source of these deposits.
The Tribunal held that the issue regarding the classification of receipts from direct sales and onward distribution as 'Royalty' is covered by the assessee's own case for AY 2019-20, where the Tribunal had remitted the issue to the AO. Therefore, these grounds are dismissed as not argued. Regarding the issue of cross-charges of costs (Rs. 4,98,63,169/-), the Tribunal noted that the DRP failed to give findings. Citing its own order for AY 2019-20, where a similar issue was remitted to the AO for fresh consideration after the assessee furnished documents, the Tribunal remitted this issue to the AO for fresh consideration with similar directions, allowing the assessee a reasonable opportunity of being heard. Grounds related to the addition under Section 28 and tax rate consistency were dismissed as infructuous. Interest under Sections 234A and 234B was held to be mandatory and consequential. The appeal was partly allowed for statistical purposes, and the stay petition was dismissed as infructuous.
The Tribunal remitted several issues back to the AO for fresh consideration, including additions related to trade credit and amounts received from ICFAI. Some grounds were allowed based on prior findings for other assessment years.
The Tribunal held that the issuance of notice under Section 153C instead of 153A was a curable defect under Section 292B, as the assessee had participated in the proceedings. The additions made by the AO were sustained, including those related to partnership assets and property valuation.
The Tribunal remitted several issues back to the AO for fresh consideration, including additions related to trade credit and amounts received from ICFAI. Some grounds were allowed based on prior findings for other assessment years.
The Tribunal remitted several issues back to the AO for fresh consideration, including additions related to trade credit and amounts received from ICFAI. Some grounds were allowed based on prior findings for other assessment years.
The Tribunal held that when incriminating documents found during a search in another entity's premises pertain to the assessee, proceedings should be initiated under Section 153C, not Section 147. Therefore, the reopening under Section 148 was jurisdictionally flawed.
The Tribunal held that conducting seminars/conferences for medical professionals is not prohibited by the cited regulations or CBDT circulars. It clarified that the prohibition is on medical practitioners accepting gifts, not on organizations holding conferences, and therefore the CIT(E)'s rejection was erroneous.
The High Court found the Tribunal's reasoning flawed in treating the assessment on a non-existent entity as a mere procedural defect. The High Court held that an assessment made on a non-existent person is null and void.
The Tribunal, after hearing rival submissions and perusing materials, referred to a similar issue considered by the Hon'ble Karnataka High Court in the case of Abbey Business Services India Pvt. Ltd. The judgment extensively discusses the interplay of Section 9(1)(vii), Section 195(1) of the Act, and DTAA provisions, referencing Supreme Court decisions in GE Technology and Engineering Analysis. The Tribunal noted that an assessee is entitled to the benefit under a DTAA and that the ITAT's view that DTAA cannot be considered in proceedings under Section 201 of the Act is tenable. It also addressed the impact of amendments to Section 9(1)(vi) and the principle that an assessee cannot be expected to do the impossible, especially concerning retrospective application of expanded definitions. The Tribunal found that the issue of whether the services provided by seconded employees constitute FTS, considering the employer-employee relationship and the DTAA, requires fresh consideration. Therefore, this issue is remitted to the file of the learned AO for fresh consideration after providing an opportunity of hearing to the assessee.
The Tribunal condoned the delay of 438 days, prioritizing substantial justice over technicalities. It held that the levy of interest under Section 234E for TDS returns filed before June 1, 2015, was illegal, following the Karnataka High Court's decision.
The Tribunal directed the AO to examine the value fixed by the DVO for computing capital gains. For other grounds regarding cost of improvement, the matter was restored to the AO for examination.
The Tribunal held that when incriminating documents found during a search in another entity's premises pertain to the assessee, proceedings should be initiated under Section 153C, not Section 147. Therefore, the reopening under Section 148 was jurisdictionally flawed.
The High Court found the Tribunal's reasoning flawed in treating the assessment on a non-existent entity as a mere procedural defect. The High Court held that an assessment made on a non-existent person is null and void.
The Hon'ble High Court set aside the Tribunal's order and remanded the case for fresh consideration. The High Court noted that the assessment was made on a non-existent entity after amalgamation, which is legally invalid.
The Tribunal found that the assessee had filed various details before the lower authorities which were not properly appreciated. The Tribunal also noted that similar claims were allowed in earlier and subsequent assessment years. Therefore, the issues were remitted to the AO for fresh consideration.
The Tribunal held that the order passed by the TPO was not erroneous and prejudicial to the interests of the revenue, and consequently, the impugned order of the CIT(TP) was quashed. Regarding Share-based compensation (ESOP expenses), the Tribunal, respectfully following the judgments relied upon by the assessee's AR, held that ESOP expenses are non-operating in nature for the purpose of computing operating margin. Therefore, the CIT(TP) was not justified in treating them as operating expenses. Concerning foreign exchange fluctuation loss and loss on investments in subsidiaries (aggregating to Rs. 228 million), the Tribunal noted that the CIT(TP) himself observed in paragraph 26 of his order that these items do not prima facie constitute operating expenses. However, in paragraph 27, the CIT(TP) directed the AO for fresh consideration of these issues. The Tribunal found this contradictory, stating that when the CIT(TP) himself observed they were not operating expenses, he could not direct a fresh examination. The Tribunal also noted that the TPO had issued a show cause notice and the assessee had replied, and the TPO had accepted the assessee's TP study. The legal issue raised by the assessee regarding the CIT's power under Section 263 before the amendment by the Finance Act, 2022, was not adjudicated as the appeal was decided on merits. The appeal was partly allowed.
The Tribunal found that the assessee had sought to accumulate Rs. 50 lakhs as per Form 10, but Form 9A, due to software default, reflected only Rs. 25,92,218/-. This discrepancy was not considered by the CIT(A). Therefore, the matter was restored to the AO for re-examination.
The Tribunal held that the receipts by way of sale of software licenses and provision of ancillary support services connected with the sale of software products cannot be assessed as royalty or FTS income in the hands of the assessee. The Tribunal relied on the decision of the Hon'ble Supreme Court in the case of *Engineering Analysis Centre for Excellence Pvt. Ltd.*, which held that amounts paid for the resale or use of computer software through EULAs or distribution agreements do not constitute royalty for the use of copyright and are not taxable in India. The Tribunal noted that the DRP's reliance on *Samsung Electronics* was reversed by the Supreme Court in the *Engineering Analysis* case. Therefore, the Tribunal set aside the AO's order and deleted the addition made on account of FTS. Regarding the interest, the Tribunal held that it is consequential and mandatory to be computed under Sections 234A, 234B, and 234C, making the ground infructuous and dismissing it. Concerning the TDS on refund, the Tribunal directed the AO to examine Form 26AS and give credit for the refund amount in accordance with the law. The penalty proceedings under Section 270A were not explicitly decided upon in the provided excerpt, but the overall appeal was partly allowed.
The Tribunal held that denying cross-examination of a third party whose statement is used to make an addition violates the principles of natural justice. The AO was directed to grant cross-examination and then reconsider the assessee's claim.
The Tribunal found the assessee's explanation for non-representation to be bonafide and, in the interest of justice, decided to give the assessee a chance to represent its case. The matter was restored to the CIT(Appeals) for a fresh decision after providing a reasonable opportunity of being heard.
The Tribunal found that the Assessing Officer (AO) had not verified the claim. Therefore, in the interest of justice, the issue was remitted back to the AO for fresh examination with a direction for the assessee to produce supporting evidence.
The Tribunal decided to remit the issue back to the AO for fresh consideration. The assessee is directed to produce necessary evidence regarding the agricultural income, and the AO must grant a proper opportunity of being heard.
The Tribunal held that the assessee's claim regarding the cost of acquisition of Property No. 1 was valid. The assessee had adopted the guidance value as per Section 55(b)(2) of the Act for determining the cost of acquisition. The reference to the District Valuation Officer (DVO) under Section 55A by the authorities below was therefore not justified. The Tribunal also noted that the assessee had filed a revised computation of total income during the assessment proceedings, correcting an inadvertent error in the guidance value adopted in the original return. The Tribunal found that the assessee had adopted the actual guidance value of Rs. 1,20,000/- per cent as at 1-4-2001, which was in accordance with the provisions of the Act. Consequently, the determination of long-term capital gain by the authorities below was set aside. The appeal was allowed on this ground.
The Tribunal found the orders of the lower authorities to be cryptic and lacking proper consideration of the assessee's submissions. Therefore, the quantum addition was remitted back to the AO for fresh consideration.
The Tribunal found that the CIT(A) dismissed the appeal ex-parte without considering the merits. Therefore, the matter was remitted back to the AO for fresh consideration after the assessee provides necessary documents regarding the land partition, developer agreement, and investment of capital gains.
The Tribunal found it appropriate to remit the issue back to the Assessing Officer (AO) to allow the assessee an opportunity to produce necessary details to substantiate the expenses claimed.
The Tribunal found the orders of the lower authorities to be cryptic and lacking proper consideration of the assessee's submissions. Therefore, the quantum addition was remitted back to the AO for fresh consideration.
The Tribunal held that the assessee failed to produce documentary evidence to substantiate the cash deposits as loan repayments during appellate proceedings. Consequently, the addition made by the AO and confirmed by the CIT(A) was upheld.
The Tribunal noted that the CIT(Appeals) did not consider the documents submitted by the assessee. In the interest of justice, the matter was remanded back to the Assessing Officer for a fresh assessment, with directions to provide the assessee with a reasonable opportunity of being heard.
The Tribunal held that the additional grounds raised by the assessee were dismissed as not pressed, as the issues on merits were covered in favour of the assessee by the jurisdictional High Court's decision in Vodafone Idea Ltd. vs. DDIT. Regarding the main grounds, the Tribunal, following the decision in Vodafone Idea Ltd. and its own reasoning, held that payments received by the assessee towards interconnectivity utility charges from Indian customers/end-users cannot be considered as Royalty taxable in India under Section 9(1)(vi) of the Act or as per the DTAA. The payments were considered business profits taxable in the assessee's resident country, not in India, as there was no Permanent Establishment in India. The Tribunal noted that the High Court in the cited case held that non-resident service providers do not have any presence in India. Consequently, Ground No. 3 was allowed in favour of the assessee. Ground No. 4 (interest under Section 234A) and Ground No. 5 (initiation of penalty proceedings) were held to be consequential and did not require adjudication. The appeals were partly allowed.
The Tribunal held that the additional grounds raised by the assessee were dismissed as not pressed, as the issues on merits were covered in favour of the assessee by the jurisdictional High Court's decision in Vodafone Idea Ltd. vs. DDIT. Regarding the main grounds, the Tribunal, following the decision in Vodafone Idea Ltd. and its own reasoning, held that payments received by the assessee towards interconnectivity utility charges from Indian customers/end-users cannot be considered as Royalty taxable in India under Section 9(1)(vi) of the Act or as per the DTAA. The payments were considered business profits taxable in the assessee's resident country, not in India, as there was no Permanent Establishment in India. The Tribunal noted that the High Court in the cited case held that non-resident service providers do not have any presence in India. Consequently, Ground No. 3 was allowed in favour of the assessee. Ground No. 4 (interest under Section 234A) and Ground No. 5 (initiation of penalty proceedings) were held to be consequential and did not require adjudication. The appeals were partly allowed.
The Tribunal held that the additional grounds raised by the assessee were dismissed as not pressed, as the issues on merits were covered in favour of the assessee by the jurisdictional High Court's decision in Vodafone Idea Ltd. vs. DDIT. Regarding the main grounds, the Tribunal, following the decision in Vodafone Idea Ltd. and its own reasoning, held that payments received by the assessee towards interconnectivity utility charges from Indian customers/end-users cannot be considered as Royalty taxable in India under Section 9(1)(vi) of the Act or as per the DTAA. The payments were considered business profits taxable in the assessee's resident country, not in India, as there was no Permanent Establishment in India. The Tribunal noted that the High Court in the cited case held that non-resident service providers do not have any presence in India. Consequently, Ground No. 3 was allowed in favour of the assessee. Ground No. 4 (interest under Section 234A) and Ground No. 5 (initiation of penalty proceedings) were held to be consequential and did not require adjudication. The appeals were partly allowed.
The Tribunal remanded the case to the AO for a fresh assessment (denovo) to provide the assessee with an opportunity to present all necessary documents and evidence. The AO was directed to grant a proper hearing.
The Tribunal condoned the delay, holding that there was a 'sufficient cause' for the delay and that substantial justice should be preferred over technicalities. The matter was then remitted back to the NFAC for a decision on merits.
The Tribunal noted that the AO did not consider CBDT circulars regarding demonetization cash deposits and that the assessment was passed ex-parte. Therefore, the matter was remanded to the AO for fresh examination.
The Tribunal held that payments received by the assessee towards interconnectivity utility charges from Indian customers/end-users cannot be considered as Royalty to be brought to tax in India under Section 9(1)(vi) of the Act or as per the India-Netherlands DTAA. The payments were considered business profits taxable in the Netherlands, not in India, as there was no Permanent Establishment of the assessee in India, a fact supported by the Hon'ble High Court's observation in a related case. The Tribunal also noted that the non-resident service providers did not have any presence in India. The issue of jurisdiction over extra-territorial sources was answered against the Revenue, as the facilities were outside India and the agreement was with a foreign entity without Indian presence. The issue regarding withholding tax at a higher rate was also decided against the Revenue, following precedent. The liability for non-deduction of tax at source was addressed by referencing the decision in 'Engineering Analysis', stating that an assessee is not obliged to do the impossible, and that the assessee is entitled to DTAA benefits. Interest under Sections 234A and 234B, and penalty proceedings under Section 271(1)(c), were held to be consequential and did not require separate adjudication. Therefore, Ground No. 4 was allowed in favour of the assessee, and Grounds 6 and 7 were not adjudicated.
The Tribunal held that payments received by the assessee towards interconnectivity utility charges from Indian customers/end-users cannot be considered as Royalty to be brought to tax in India under Section 9(1)(vi) of the Act or as per the India-Netherlands DTAA. The payments were considered business profits taxable in the Netherlands, not in India, as there was no Permanent Establishment of the assessee in India, a fact supported by the Hon'ble High Court's observation in a related case. The Tribunal also noted that the non-resident service providers did not have any presence in India. The issue of jurisdiction over extra-territorial sources was answered against the Revenue, as the facilities were outside India and the agreement was with a foreign entity without Indian presence. The issue regarding withholding tax at a higher rate was also decided against the Revenue, following precedent. The liability for non-deduction of tax at source was addressed by referencing the decision in 'Engineering Analysis', stating that an assessee is not obliged to do the impossible, and that the assessee is entitled to DTAA benefits. Interest under Sections 234A and 234B, and penalty proceedings under Section 271(1)(c), were held to be consequential and did not require separate adjudication. Therefore, Ground No. 4 was allowed in favour of the assessee, and Grounds 6 and 7 were not adjudicated.
The Tribunal held that payments received by the assessee towards interconnectivity utility charges from Indian customers/end-users cannot be considered as Royalty to be brought to tax in India under Section 9(1)(vi) of the Act or as per the India-Netherlands DTAA. The payments were considered business profits taxable in the Netherlands, not in India, as there was no Permanent Establishment of the assessee in India, a fact supported by the Hon'ble High Court's observation in a related case. The Tribunal also noted that the non-resident service providers did not have any presence in India. The issue of jurisdiction over extra-territorial sources was answered against the Revenue, as the facilities were outside India and the agreement was with a foreign entity without Indian presence. The issue regarding withholding tax at a higher rate was also decided against the Revenue, following precedent. The liability for non-deduction of tax at source was addressed by referencing the decision in 'Engineering Analysis', stating that an assessee is not obliged to do the impossible, and that the assessee is entitled to DTAA benefits. Interest under Sections 234A and 234B, and penalty proceedings under Section 271(1)(c), were held to be consequential and did not require separate adjudication. Therefore, Ground No. 4 was allowed in favour of the assessee, and Grounds 6 and 7 were not adjudicated.
The Tribunal held that payments received by the assessee towards interconnectivity utility charges from Indian customers/end-users cannot be considered as Royalty to be brought to tax in India under Section 9(1)(vi) of the Act or as per the India-Netherlands DTAA. The payments were considered business profits taxable in the Netherlands, not in India, as there was no Permanent Establishment of the assessee in India, a fact supported by the Hon'ble High Court's observation in a related case. The Tribunal also noted that the non-resident service providers did not have any presence in India. The issue of jurisdiction over extra-territorial sources was answered against the Revenue, as the facilities were outside India and the agreement was with a foreign entity without Indian presence. The issue regarding withholding tax at a higher rate was also decided against the Revenue, following precedent. The liability for non-deduction of tax at source was addressed by referencing the decision in 'Engineering Analysis', stating that an assessee is not obliged to do the impossible, and that the assessee is entitled to DTAA benefits. Interest under Sections 234A and 234B, and penalty proceedings under Section 271(1)(c), were held to be consequential and did not require separate adjudication. Therefore, Ground No. 4 was allowed in favour of the assessee, and Grounds 6 and 7 were not adjudicated.
The Tribunal admitted additional grounds related to DTAA benefits, but ultimately dismissed the appeal. It held that both the deduction for education cess and the DTAA benefit on dividend distribution tax were decided against the assessee by higher judicial precedents.
The Tribunal held that the explanation for the inordinate delay was not satisfactory and lacked bonafide effort. Relying on Supreme Court judgments, the Tribunal emphasized the importance of vigilance and reasonable cause for condoning delay.
The Tribunal held that the notices were not properly served on the assessee, leading to a violation of natural justice. Therefore, the case was remitted back to the NFAC for fresh consideration.
The Tribunal, considering the assessee is a senior citizen and may not have been aware of online notices, decided to grant one more opportunity to present the case on merits. The issue was remitted back to the Assessing Officer for a fresh adjudication.
The Tribunal restored the matter to the file of the AO (since adjustment was made by CPC) to provide the assessee with an opportunity to present evidence and submissions. The assessee was directed to cooperate and avoid unnecessary adjournments.
The Tribunal found that the assessee was not provided with adequate opportunity of being heard and that there was a violation of natural justice principles. Therefore, the matter was remanded to the Assessing Officer for fresh examination.
The Tribunal held that interest income from investments made under compulsion of law or for business purposes should be treated as business income. The AO was directed to re-examine the nature of investments and eligibility for deduction under section 80P.