ITAT Chennai Judgments — April 2017

The Tribunal allowed appeals concerning the reopening of assessments, finding that the Assessing Officer had sufficient material during the original assessment and the reopening was based on a change of opinion. However, it confirmed disallowances for marriage reception, subsidiary setup, water connection, and higher education expenses, deeming them not business-related.

The Tribunal held that the CIT(A) should have provided the AO an opportunity to examine the additional evidence submitted by the assessee as per Rule 46A(3). Therefore, the matter was remitted back to the AO.

The Tribunal held that the CBDT Circular No. 21/2015, which instructs officers to withdraw appeals with a tax effect below Rs. 10 lakhs, is binding. Therefore, the Revenue could not proceed with these appeals.

The Tribunal held that the CBDT Circular No. 21/2015, which instructs officers to withdraw appeals with a tax effect below Rs. 10 lakhs, is binding. Therefore, the Revenue could not proceed with these appeals.

The Tribunal held that the DRP exceeded its powers by remitting the transfer pricing issues back to the AO/TPO, as Section 144C(8) of the Income Tax Act restricts the DRP to confirming, reducing, or enhancing variations, not setting aside or directing further enquiry. Consequently, the transfer pricing issues were remitted back to the DRP.

The Tribunal held that the CBDT Circular No. 21/2015, which instructs officers to withdraw appeals with a tax effect below Rs. 10 lakhs, is binding. Therefore, the Revenue could not proceed with these appeals.

The Tribunal noted that the CBDT circular instructed its officers to withdraw appeals where the tax effect is less than Rs. 10 lakhs. The Tribunal considered this circular binding on the Department.

The Tribunal held that the losses on depletion of closing stock of shares and units should be treated as business loss. The Tribunal found that the assessee's transactions were genuinely trading in nature and not speculative.

The Tribunal held that the losses on depletion of closing stock of shares and units should be treated as business loss. The Tribunal found that the assessee's transactions were genuinely trading in nature and not speculative.

The Tribunal held that the commission paid to non-resident agents for procuring orders was a commission simpliciter and not 'fees for technical services'. Therefore, the assessee was not liable to deduct tax at source on such payments.

The Tribunal noted that a similar issue for the same assessment year in the Revenue's appeal was remitted back to the Assessing Officer for fresh consideration. Therefore, the assessee's appeal was also remitted back with similar directions.

The Tribunal held that the losses on depletion of closing stock of shares and units should be treated as business loss. The Tribunal found that the assessee's transactions were genuinely trading in nature and not speculative.

The Tribunal held that the losses on depletion of closing stock of shares and units should be treated as business loss. The Tribunal found that the assessee's transactions were genuinely trading in nature and not speculative.

The Tribunal held that the assessee is eligible for exemption under Section 11 of the Act, confirming the CIT(Appeals)'s decision. However, it also held that depreciation under Section 32 cannot be claimed on assets whose entire cost was allowed as application of income under Section 11.

The Tribunal held that the assessee is eligible for exemption under Section 11 of the Act, confirming the CIT(Appeals)'s decision. However, it also held that depreciation under Section 32 cannot be claimed on assets whose entire cost was allowed as application of income under Section 11.

The Tribunal found that crucial details regarding the shareholding pattern of M/s Shriram Composites Ltd. were not on record. Consequently, both the issue of interest disallowance and Section 14A disallowance were remitted back to the Assessing Officer for fresh examination.

The Tribunal held that the assessee is eligible for exemption under Section 11 of the Act, confirming the CIT(Appeals)'s decision. However, it also held that depreciation under Section 32 cannot be claimed on assets whose entire cost was allowed as application of income under Section 11.

The Tribunal upheld the estimation of income by the Assessing Officer at 8% of gross receipts. The assessee's claim of following the project completion method was rejected due to the non-production of books of accounts, bills, and vouchers to substantiate expenditure and revenue recognition.

The Tribunal held that the AO's conclusion of quid-pro-quo arrangements was based on presumptions and assumptions, not cogent evidence. The CIT(A)'s decision to allow the benefit of Section 11 was sustained.

The Tribunal held that the AO's conclusion of quid-pro-quo arrangements was based on presumptions and assumptions, not cogent evidence. The CIT(A)'s decision to allow the benefit of Section 11 was sustained.

The Tribunal held that the AO's conclusion of quid-pro-quo arrangements was based on presumptions and assumptions, not cogent evidence. The CIT(A)'s decision to allow the benefit of Section 11 was sustained.

The Tribunal held that the AO's conclusion of quid-pro-quo arrangements was based on presumptions and assumptions, not cogent evidence. The CIT(A)'s decision to allow the benefit of Section 11 was sustained.

The Tribunal upheld the estimation of income by the Assessing Officer at 8% of gross receipts. The assessee's claim of following the project completion method was rejected due to the non-production of books of accounts, bills, and vouchers to substantiate expenditure and revenue recognition.

The Tribunal held that the AO's conclusion of quid-pro-quo arrangements was based on presumptions and assumptions, not cogent evidence. The CIT(A)'s decision to allow the benefit of Section 11 was sustained.

The Tribunal held that for the Assessment Year 2003-04, the disallowance under Section 40(a)(i) was not attracted as the assessee had deducted tax at source. Furthermore, for payments related to services rendered outside India, tax was not deductible as per the prevailing law at that time, supported by Supreme Court decisions.

The Tribunal held that the DRP, as per Section 144C of the Income Tax Act, has no power to remit the matter back to the AO/TPO and must determine the adjustment itself. Therefore, the issue was remitted back to the DRP to work out the correct working capital adjustment.

The Tribunal found that the daughter of the maternal uncle supported the assessee's claim and stated that the sons lacked knowledge of their father's dealings. The Assessing Officer did not consider this statement objectively.

The Tribunal held that the assessee failed to substantiate the source of the cash deposits. The evidence provided, including a broker's statement, was not supported by any documentary proof and was inconsistent with the company's financial records.

The Tribunal held that reopening the assessment after four years from the end of the relevant assessment year is barred by limitation, as there was no negligence on the part of the assessee and no new material was available. The reopening also amounted to a change of opinion.

The Tribunal upheld the CIT(A)'s decision, stating that passive usage of an asset is sufficient for depreciation if the business is a going concern. It also held that the write-off of interest in a subsequent year does not affect the allowability of interest expenditure in the current year.

The Tribunal held that fees paid for increasing authorized share capital are capital in nature and not allowable as revenue expenditure or under Section 35D. It also considered the issue of capitalizing interest on ECB loan and sales promotion expenses when manufacturing had not commenced.

The Tribunal held that if the recipient had accounted for the rent receipts and paid taxes thereon, the assessee could not be subjected to disallowance under Section 40(a)(ia). The issue requires verification by the Assessing Officer.

The Tribunal held that the treatment of interest income was academic as it had the same tax effect regardless of the head. Regarding disallowance under Section 14A, the Tribunal followed the jurisdictional High Court's view that no disallowance can be made if there is no exempt income.

The Tribunal confirmed the order of the CIT(A), holding that the assessee failed to provide a basis for the warranty provision and did not reverse unutilized portions. The historical warranty claims were significantly lower than the provisions made.

The Tribunal held that in the absence of proper books of accounts and evidence, the assessee's claim of following the project completion method was unsubstantiated. Therefore, the Assessing Officer was justified in rejecting the books and estimating the income.

The Tribunal upheld the lower authorities' decision to reject the assessee's books of accounts due to lack of evidence. Consequently, the estimation of income at 8% of gross receipts was confirmed as the assessee failed to prove their accounting method.

The Tribunal held that the disallowance was not justified. It noted that the assessee had substantial capital in her business, exceeding her drawings, indicating that the loan was not necessarily used for personal construction.

The Tribunal held that the assessee is entitled to interest on the refund from April 1, 2004, till the date of refund as per CBDT circular and Section 244A(1)(a) of the Act. The delay in filing the appeal was condoned.

The Tribunal, relying on previous decisions, held that Section 14A is not applicable to investments made in sister/associate concerns for strategic reasons, provided they are not made from borrowed funds. The matter was remitted to the AO for fresh consideration.

The Tribunal held that since the amount received was a reimbursement of salary and no income accrued to the assessee, there was no concealment of income or furnishing of inaccurate particulars. Therefore, the penalty was not leviable.

The Tribunal held that the assessee failed to provide a reasonable cause for violating Sections 269SS and 269T of the Income Tax Act. Consequently, the penalties levied under Sections 271D and 271E were rightly imposed.

The Tribunal held that the fly ash handling system was eligible for 100% depreciation as it was an air pollution control equipment. The cost of constructing the causeway was also treated as revenue expenditure as it did not belong to the assessee and was for public use.

The Tribunal held that the fly ash handling system, being an air pollution control equipment, was eligible for 100% depreciation. It also ruled that the cost of constructing the causeway was revenue expenditure as it did not belong to the assessee and was for public use.

The Tribunal held that the fly ash handling system was eligible for 100% depreciation as it was an air pollution control equipment. The cost of constructing the causeway was also treated as revenue expenditure as it did not belong to the assessee and was for public use.

The Tribunal held that the fly ash handling system was eligible for 100% depreciation as it was an air pollution control equipment. The cost of constructing the causeway was also treated as revenue expenditure as it did not belong to the assessee and was for public use.

The Tribunal held that the transfer pricing issues required a revisit by the DRP due to various factors including recalculation of comparable margins. The issue of employee's PF contribution was remitted to the Assessing Officer for verification of payment dates.

The Tribunal held that the assessees are eligible for exemption under Section 54F, even if they received multiple flats, following the Madras High Court judgment in CIT v. Smt. V.R. Karpagam. This was a second round of litigation where the Tribunal confirmed its earlier decision.

The Tribunal held that the assessee failed to provide a reasonable cause for violating Sections 269SS and 269T of the Income Tax Act. Consequently, the penalties levied under Sections 271D and 271E were rightly imposed.

The Tribunal confirmed the CIT(A)'s findings, following its own prior decision in the assessee's own case. The Revenue failed to dislodge the earlier findings and the AO's consistent stand.

The Tribunal confirmed the CIT(A)'s findings, following its own previous decision in the assessee's own case. The Tribunal found no reason to interfere with the CIT(A)'s order which deleted the additions made by the AO.