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122 orders · Page 1 of 3
The Tribunal held that the assessee's failure to appear before the NFAC was due to a lack of familiarity with the ITBA portal, which constitutes a valid reason. Therefore, the matter was remitted back to the NFAC for a fresh hearing.
The Tribunal noted that the AO correctly invoked Section 154 as the omission to offer global income was a factual mistake and not a debatable issue. The assessee had claimed foreign tax credit without offering the global income, which was rectified by the AO. The CIT(A) had directed the AO to consider the tax credit claim. The Tribunal directed the AO to follow the CIT(A)'s direction for giving effect to the order considering DTAA provisions.
The Tribunal noted that a coordinate bench had previously quashed the revision order passed by the CIT under Section 263 of the Act. Consequently, the subsequent proceedings giving effect to the revision order by the AO and CIT(A) were deemed non est in law and unsustainable. The Tribunal quashed the impugned order of the CIT(Appeals).
The Tribunal held that the AO erred in rejecting the Discounted Cash Flow (DCF) method solely based on future actual results. The AO can scrutinize the valuation report and determine a fresh valuation using the DCF method, but cannot change the method chosen by the assessee.
The Tribunal held that the issue of unexplained cash deposits needs to be verified by the AO. However, the Tribunal upheld the denial of deduction under Section 80P, as the assessee failed to file its return of income.
The Tribunal held that the CIT(A)'s directions to the AO to compute the loss considering the lower of brought forward loss or depreciation on a cumulative basis were in line with the dictum laid down by the jurisdictional Tribunal in the case of DCIT Vs. BIAL and the Mumbai Bench of the Tribunal in the case of Amline Textiles Pvt. Ltd.
The Tribunal held that the sale proceeds received by the assessee on the sale of software licenses cannot be categorized as 'Royalty' within the meaning of the provisions of the DTAA. The Tribunal respectfully followed the decision of the Hon'ble Supreme Court in the case of Engineering Analysis Centre of Excellence Pvt. Ltd. (supra). The Supreme Court had concluded that amounts paid by resident Indian end-users/distributors to non-resident computer software manufacturers/suppliers, as consideration for the resale/use of computer software through EULAs/distribution agreements, do not create any interest or right amounting to the use of or right to use any copyright. Therefore, these payments are not royalty and do not give rise to any income taxable in India. The Tribunal noted that the jurisdictional High Court had also ruled in favor of the assessee on similar grounds, relying on the Supreme Court's decision. Consequently, the Tribunal set aside the order of the AO and directed the deletion of the addition made as 'royalty' income. Ground No. 3 raised by the assessee was allowed.
The Tribunal clarified that the appeal should be remitted to the Assessing Officer for fresh consideration and decision, subject to the assessee paying costs of Rs. 10,000/- and producing necessary documents. The assessee is to be given a reasonable opportunity of hearing.
The Tribunal noted that the assessee did not file Form 10-IC within the prescribed time for both assessment years. For AY 2020-21, the application for condonation was pending before the CBDT, and for AY 2021-22, the CBDT had disposed of the application without specific directions.
The Tribunal noted that the assessee could not provide credible evidence regarding the due date of salary payment as per employment terms. The Tribunal found discrepancies between the tax audit report and the assessee's submissions regarding the due date.
The Tribunal held that Section 36(1)(va) and Section 43B(b) of the Income Tax Act operate differently regarding due dates for employee and employer contributions. Failure to deposit employee contributions by the prescribed due date results in permanent negation of deduction, as per the Supreme Court's decision in Checkmate Services Pvt. Ltd. vs. CIT.
The Tribunal noted that the assessee did not file Form 10-IC within the prescribed time for both assessment years. For AY 2020-21, the application for condonation was pending before the CBDT, and for AY 2021-22, the CBDT had disposed of the application without specific directions.
The Tribunal held that the payments made by GIPL to GIL for the sale of online advertisement space are not in the nature of royalty or Fees for Technical Services (FTS) under the Act and the India-Ireland DTAA. The Tribunal relied on its own previous orders in the assessee's own case and in the payer's (GIPL) case. Specifically, the Tribunal referred to its order dated 28.02.2023 in IT(UT)A No.2845/Bang/2017 and the order dated 19.10.2022 in IT(TP)A Nos.1513 to 1516/Bang/2013, which held that such payments cannot be characterized as royalty. The Tribunal noted that the international jurisprudence, including OECD recommendations and the CBDT's High-Powered Committee's view, supports taxing such income as business profits, taxable only if the non-resident has a Permanent Establishment (PE) in India. The Tribunal also pointed to the introduction of Equalisation Levy (EL) for online advertisements as an indication that such income was not previously considered royalty. Consequently, the additions made by the AO treating these payments as royalty were deleted. The jurisdictional grounds were left open.
The Tribunal held that payments made by GIPL to GIL for online advertisement space are not in the nature of royalty or fees for technical services. Consequently, such income is not taxable in India in the hands of GIL.
The Tribunal noted that the dispute revolved around the due date for payment of employee contributions to PF/ESI. Since the assessee could not provide credible evidence regarding the salary payment due date as per employment terms, the matter was restored to the AO for fresh consideration.
The Tribunal held that payments received by GIL from GIPL for online advertisement space are not in the nature of royalty under the Act and the India-Ireland DTAA. Therefore, such income cannot be taxed in India in the hands of GIL unless it has a Permanent Establishment (PE) in India.
The Tribunal held that payments received by GIL from GIPL for online advertisement space are not in the nature of royalty under the Act and the India-Ireland DTAA. Therefore, such income cannot be taxed in India in the hands of GIL unless it has a Permanent Establishment (PE) in India.
The Tribunal noted that the NFAC did not consider relevant Supreme Court decisions, particularly regarding the applicability of Section 80P(2)(a)(i) and 80P(2)(d) concerning interest income from deposits. The Tribunal decided to remand the appeals back to the NFAC/CIT(A) for readjudication.
The Tribunal held that the addition made by the AO and sustained by the CIT(A) was deleted in the quantum appeal because it was based on uncorroborated loose slips without cogent evidence. Consequently, the penalty levied under Section 271AAB could not stand.
The Tribunal noted that the details submitted by the assessee regarding the cash deposits were not doubted or examined by the lower authorities. Therefore, the issue was remitted back to the AO for verification of these details.
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 Hon'ble Supreme Court's decision in the case of Engineering Analysis Centre of Excellence Pvt. Ltd. and Ors. v. CIT, which held that amounts paid by resident Indian end-users/distributors to non-resident computer software manufacturers/suppliers for the resale/use of computer software through EULAs/distribution agreements are not payments of royalty for the use of copyright. The Court further clarified that such transactions constitute a sale of goods, not a transfer of copyright. The Tribunal noted that the DRP's reliance on the Samsung Electronics case was reversed by the Supreme Court in the Engineering Analysis case. The Tribunal also observed that the AO himself referred to prior assessment orders for AY 2019-20 and AY 2020-21, where the issue was identical and decided in favour of the assessee, with no distinguishing features presented by the revenue for the current year. Accordingly, the Tribunal set aside the AO's order and deleted the addition made.
The Tribunal held that the assessment orders framed under Section 153C of the Act were bad in law and void-ab-initio. The primary reason for this decision was the failure of the Assessing Officer (AO) to satisfy the conditions precedent for invoking Section 153C. The Tribunal noted that the satisfaction recorded by the AO was a general one, stating that the seized materials pertained to a person other than the searched person and belonged to that other person. However, there was no specific finding or material on record to demonstrate that any incriminating documents or assets belonging to the assessee were found during the search conducted in the case of M/s Coffee Day Global Ltd. or Shri K.M. Deekshith that were relevant for computing the assessee's income. The Tribunal emphasized that the satisfaction of the AO must be based on tangible material linking the seized items to the assessee. Since this crucial link was missing, the invocation of Section 153C was not justified. Consequently, the additions made under Section 69 based on the loose sheets and the statement of Shri K.M. Deekshith were also deleted. The Tribunal found that the reliance on the statement of Shri K.M. Deekshith without providing an opportunity for cross-examination also violated the principles of natural justice. The appeals were allowed on these grounds. The issue regarding penalty under Section 271AAB was not explicitly decided in the provided excerpt but was part of the overall appeals.
The Tribunal noted that the assessment was completed under section 143(3). It was also observed that the first appellate authority issued notices on different dates, but according to the assessee, these notices were not served. Considering the interest of justice, the Tribunal decided to remit the matter back to the CIT(Appeals) for fresh consideration.
The Tribunal noted that Form 10B was uploaded by the auditor before the return processing and approved by the assessee before the return of income was processed. Due to the absence of a regular Executive Officer, there was a delay in approval. Therefore, the rectification order was deemed incorrect, and the CIT(Appeals) had rightly allowed the assessee's appeal.
The tribunal acknowledged that ignorance is not an excuse but emphasized that justice requires no party to be unheard. It was noted that there was no proper representation before the NFAC. The tribunal opined that the assessee had not benefited from non-representation and had suffered due to prolonged litigation.
The Tribunal noted that the NFAC had not considered relevant Supreme Court decisions. The Tribunal also observed that the Supreme Court, in a subsequent decision, analyzed the applicability of Section 80P(2)(d) for interest income from deposits. Therefore, the Tribunal remanded the case back to the NFAC/CIT(A).
The Tribunal noted that the NFAC/CIT(A) had not considered recent Supreme Court decisions regarding section 80P(2)(d) deductions, specifically in the cases of Mavilayi Service Co-operative Bank Ltd. and Kerala State Co-operative Agricultural and Rural Development Bank Ltd. Therefore, the Tribunal decided to remand the case.
The Tribunal held that the addition made by the AO and sustained by the CIT(A) was deleted in the quantum appeal because it was based on uncorroborated loose slips without cogent evidence. Consequently, the penalty levied under Section 271AAB could not stand.
The Tribunal held that the addition made by the AO and sustained by the CIT(A) was deleted in the quantum appeal because it was based on uncorroborated loose slips without cogent evidence. Consequently, the penalty levied under Section 271AAB could not stand.
The CIT(A) dismissed the appeal, agreeing with the AO that the explanation of debt recovery was an afterthought and that the assessee failed to substantiate the claim. The Tribunal noted that the authorities below had not verified documents to explain the cash deposits and that this needed verification in light of CBDT circulars.
The Tribunal held that the filing of Form 67 is a procedural, directory requirement and not mandatory. Relying on Supreme Court judgments, it was stated that procedural delays should not extinguish a substantive right, especially when there is sufficient cause and no malafide intention. The DTAA provisions override the Act, and the assessee has a vested right to claim FTC.
The Tribunal condoned the delay in filing the appeal. On merits, the Tribunal noted that the Supreme Court in Mavilayi Service Co-operative Bank Ltd. has held that Section 80P should be read liberally in favour of the assessee.
The Tribunal noted that while the assessee provided some details of members from whom cash was received, it lacked complete information like account numbers and PAN/Aadhar for all members. Therefore, the Tribunal directed the AO to re-examine the issue after the assessee provides the complete details, considering a co-ordinate bench's decision.
The Tribunal noted that the NFAC/CIT(A) did not consider the directions of the Hon'ble Supreme Court in Mavilayi Service Co-operative Bank Ltd. v. CIT and a subsequent decision in Kerala State Co-operative Agricultural and Rural Development Bank Ltd. v. The Assessing Officer. The Tribunal held that the applicability of section 80P(2)(d) deduction for interest/dividend income earned from deposits needs detailed analysis.
The Tribunal held that additions cannot be made solely on the basis of loose sheets and unsigned entries without corroborative evidence. The AO must ascertain undisclosed income from seized material and consider net profit rates, not gross receipts.
The assessee's representative argued that they did not receive the notices from the FAA and requested a chance to represent the case. Considering the rival submissions and in the interest of justice, the Tribunal decided to remit the issue back to the AO for fresh consideration.
The Tribunal noted that the assessee made cash deposits during demonetisation, and while the AO made additions under section 69A, the lower authorities did not sufficiently verify the evidence. The Tribunal directed the assessee to provide details of depositors for loan repayments and ordered the AO to verify these with proper opportunity for the assessee to be heard.
The Tribunal held that additions cannot be made solely on the basis of loose sheets and unsigned entries without corroborative evidence. The AO must ascertain undisclosed income from seized material and consider net profit rates, not gross receipts.
The Tribunal held that the addition made by the AO and sustained by the CIT(A) was deleted in the quantum appeal because it was based on uncorroborated loose slips without cogent evidence. Consequently, the penalty levied under Section 271AAB could not stand.
The Tribunal held that additions made based solely on loose sheets found in a third party's premises and uncorroborated statements are not sustainable. Independent inquiry and sufficient evidence are required to prove such transactions.
The Tribunal held that additions cannot be made solely on the basis of loose sheets and unsigned entries without corroborative evidence. The AO must ascertain undisclosed income from seized material and consider net profit rates, not gross receipts.
The Tribunal noted that the authorities below had not verified documents to explain the cash deposits and made the addition. The Tribunal referred to CBDT circulars concerning the verification of cash deposits and instructed the assessee to establish the genuineness of the deposits by providing details of depositors. The AO was directed to verify these details.
The Assessing Officer initiated penalty proceedings for furnishing inaccurate particulars of income but admittedly imposed penalty for concealment of income, on which no separate proceedings were initiated. Therefore, the penalty is not sustainable.
The Tribunal condoned the delay in filing the appeal. On merits, the Tribunal noted that the Supreme Court in Mavilayi Service Co-operative Bank Ltd. has not distinguished between nominal and associate members in relation to Section 80P(2)(a)(i).
The Tribunal held that contributions to the SPV, being a condition for resuming mining operations and for reclamation/rehabilitation, were in the nature of business expenditure. It also noted that the Supreme Court directed refunds of any unutilized guarantee money.
The Tribunal condoned the delay in filing the appeal, finding sufficient cause. The appeal was then remanded to the NFAC for a fresh hearing, directing the NFAC to grant the assessee a proper opportunity to present their case.
The Tribunal noted that Section 38 of the Employees Provident Fund Scheme, 1952, requires deposits within 15 days of the salary becoming due. The assessee's argument of shifting the salary payment date to justify delayed deposits was not accepted, especially in light of the Supreme Court's decision in CHECKMATE SERVICES PVT LTD VS CIT-1. The Tribunal directed the AO to verify details and restrict disallowance to payments deposited beyond the statutory due date.
The Tribunal noted that while the assessee did not appear before the CIT(A), the period was affected by the COVID-19 pandemic, suggesting a possibility of oversight. The Tribunal emphasized the assessee's right to be heard and stated that the CIT(A) should have considered the issues on merits regardless of non-appearance.
The Tribunal held that the filing of Form 67 is a procedural, directory requirement and not mandatory. Relying on Supreme Court judgments, it was stated that procedural delays should not extinguish a substantive right, especially when there is sufficient cause and no malafide intention. The DTAA provisions override the Act, and the assessee has a vested right to claim FTC.
The Tribunal acknowledged that the appeal was decided ex parte and that the assessee claimed non-receipt of hearing notices from NFAC. In the interest of justice and equity, the Tribunal decided to provide the assessee with another opportunity.