ITAT Chennai Judgments — October 2019

The Tribunal held that while excluding foreign entities and investments not yielding exempt income was correct, excluding investments in subsidiary companies was not permissible. The disallowance under Section 14A was also confirmed not to be added back to book profits under Section 115JB.

The Tribunal held that since the tax due was paid before the return was filed and was not less than the tax payable on the returned income, the levy of interest under Sections 234A and 234B was not justified. The Tribunal relied on the Supreme Court's decision in CIT vs. Pranoy Roy.

The Tribunal held that while excluding foreign entities and investments not yielding exempt income was correct, excluding investments in subsidiary companies was not permissible. The disallowance under Section 14A was also confirmed not to be added back to book profits under Section 115JB.

The Tribunal held that the CIT(A) should not have dismissed the appeal in limine as the right of appeal is substantive and procedural defects can be cured. The appeal was remitted back to the CIT(A) for denovo adjudication.

The Tribunal held that while excluding foreign entities and investments not yielding exempt income was correct, excluding investments in subsidiary companies was not permissible. The disallowance under Section 14A was also confirmed not to be added back to book profits under Section 115JB.

The Tribunal held that the assessee was not given an opportunity to rebut the DVO's report, which was against him. Therefore, the matter was restored back to the AO to allow the assessee to file objections to the DVO's report.

The Tribunal held that the CBDT Circular No. 17/2019, which mandates withdrawal of appeals with a tax effect below Rs. 50 lakhs, is binding on the Revenue's officers.

The Tribunal dismissed the Revenue's appeal regarding royalty payments, holding them as revenue expenditure, following consistent past decisions. However, the issue regarding Section 14A disallowance for book profit computation was remitted back to the AO for fresh adjudication.

The Tribunal held that while excluding foreign entities and investments not yielding exempt income was correct, excluding investments in subsidiary companies was not permissible. The disallowance under Section 14A was also confirmed not to be added back to book profits under Section 115JB.

The Tribunal held that since the tax due was paid before the return was filed and was not less than the tax payable on the returned income, the levy of interest under Sections 234A and 234B was not justified. The Tribunal relied on the Supreme Court's decision in CIT vs. Pranoy Roy.

The Tribunal held that deduction under Section 35(2AB) is allowed only for expenditure approved by the prescribed authority (DSIR). Since the assessee failed to produce evidence of approval, the disallowance was upheld.

The Tribunal found that the assessee had not produced sufficient evidence to support its claim that the TDS was wrongly reflected in its name. Therefore, the issue was remitted back to the AO for fresh examination.

The Tribunal held that the revisionary proceedings under Section 263 were invalid as the AO had taken a possible view, and the CIT(A) had also deleted the addition. The Tribunal quashed the revisionary proceedings.

The Tribunal upheld the PCIT's order, stating that an HUF cannot be a partner in a partnership firm. The Assessing Officer's failure to inquire into this aspect made the assessment order erroneous.

The Tribunal held that the revisionary proceedings under Section 263 were invalid as the AO had taken a possible view, and the CIT(A) had also deleted the addition. The Tribunal quashed the revisionary proceedings.

The Tribunal held that cash transactions among family members/siblings for emergent agricultural needs can be considered a reasonable cause under Section 273B. Therefore, the penalty under Section 271D may not be warranted.

The Tribunal held that the CIT(A) did not address the Assessing Officer's specific observations regarding the seller's practice of purchasing and selling windmills to claim depreciation. The Tribunal remanded the issue back to the CIT(A) for fresh adjudication.

The Tribunal held that the revisionary proceedings under Section 263 were invalid as the AO had taken a possible view, and the CIT(A) had also deleted the addition. The Tribunal quashed the revisionary proceedings.

The Tribunal held that the revisionary proceedings under Section 263 were invalid as the AO had taken a possible view, and the PCIT could not revise the order simply because they disagreed with the AO's approach. The appeals related to the validity of the Section 263 proceedings.

The Tribunal held that the revisionary proceedings under Section 263 were invalid as the AO had taken a possible view, and the CIT(A) had also deleted the addition. The Tribunal quashed the revisionary proceedings.

The Tribunal held that the revisionary proceedings under Section 263 were invalid as the AO had taken a possible view, and the CIT(A) had also deleted the addition. The Tribunal quashed the revisionary proceedings.

The Tribunal dismissed the appeal filed by the Revenue, citing CBDT Circular No. 17/2019 which mandates that appeals with a tax effect below Rs. 50 lakhs should not be filed. The issues raised were left open for future examination.

The Tribunal held that the unregistered sale agreement coupled with the registered irrevocable GPA established the assessee's ownership from an earlier date. Therefore, long-term capital gains should be computed, and costs of improvement and selling expenses should be considered.

The Tribunal held that the statement of a third party, without providing an opportunity for cross-examination, cannot be the sole basis for assessment. The facts regarding the purchase and holding period of shares were not clearly established.

The Tribunal held that the appeal was covered by CBDT Circular No. 17/2019, which mandates withdrawal of appeals with a tax effect below Rs. 50 lakhs. Therefore, the Revenue could not proceed with the appeal.

The Tribunal held that the Principal Commissioner of Income Tax (PCIT) erred in initiating revision proceedings under Section 263. The AO had conducted sufficient inquiry and verified the explanation provided by the assessee regarding the increase in capital, making the assessment order not erroneous or prejudicial to the interest of the revenue.

The Tribunal held that the disallowance of expenses under Section 40(a)(ia) for non-deduction of TDS needs to be restored to the CIT(A) for fresh adjudication. The assessee must produce evidence that the payees have included these amounts as income and paid taxes.

The Tribunal upheld the addition of the unexplained amount, finding that the assessee failed to provide evidence of duress and that the seller's statement, along with documentary evidence, was credible. The assessee's initial acceptance of the facts was considered decisive.

The Tribunal confirmed the order of the CIT(A), holding that the royalty payment for the right to use a logo is a revenue expenditure and not a capital expenditure. The issue was squarely covered by previous decisions of the Tribunal in the assessee's own cases.

The Tribunal held that the assessee failed to demonstrate a bonafide and sufficient cause for the significant delay in filing the appeal. The Tribunal refused to condone the delay and dismissed the appeal.

The Tribunal held that the Revenue authorities were precluded from filing the appeals as the tax effect was below the monetary limit. Consequently, the appeals were dismissed as un-admitted.

The Tribunal held that the disallowance of expenses under Section 40(a)(ia) for non-deduction of TDS needs to be restored to the CIT(A) for fresh adjudication. The assessee must produce evidence that the payees have included these amounts as income and paid taxes.

The Tribunal confirmed the order of the CIT(A), holding that the royalty payment for the right to use a logo is a revenue expenditure and not a capital expenditure. The issue was squarely covered by previous decisions of the Tribunal in the assessee's own cases.

The Tribunal accepted the assessee's submission regarding the low tax effect. Since the tax effect was less than the prescribed monetary limit for appeals, the Revenue was precluded from filing the appeal.

The Tribunal held that the Revenue authorities were precluded from filing the appeals as the tax effect was below the monetary limit. Consequently, the appeals were dismissed as un-admitted.

The Tribunal accepted the assessee's submission regarding the low tax effect. Since the tax effect was less than the prescribed monetary limit for appeals, the Revenue was precluded from filing the appeal.

The Tribunal accepted the assessee's submission regarding the low tax effect. Since the tax effect was less than the prescribed monetary limit for appeals, the Revenue was precluded from filing the appeal.

The Tribunal held that the Revenue authorities were precluded from filing the appeals as the tax effect was below the monetary limit. Consequently, the appeals were dismissed as un-admitted.

The Tribunal held that the Revenue authorities were precluded from filing the appeals as the tax effect was below the monetary limit. Consequently, the appeals were dismissed as un-admitted.

The Tribunal held that surcharge and education cess are part of income-tax, and therefore, MAT credit should be adjusted against the total tax liability including these components. The Revenue's appeal was dismissed.

The Tribunal held that the non-realization of invoice value beyond the stipulated period constitutes a separate international transaction requiring benchmarking. Interest on delayed receivables is distinct from working capital adjustments and must be independently assessed.

The Tribunal held that the Revenue authorities were precluded from filing the appeals as the tax effect was below the monetary limit. Consequently, the appeals were dismissed as un-admitted.

The Tribunal held that Cross Belt Analyser and Magnetic Separator are testing tools for raw material quality and not solid waste recycling or resource recovery systems, thus not eligible for 100% depreciation. Prospecting expenses were disallowed following a prior year's decision. The deduction under Section 115JA was confirmed as profit, after depreciation, was nil.

The tribunal, following its own precedent for earlier assessment years, decided to remit the entire issue back to the Assessing Officer for re-examination. This includes the cash deposits and other investments like lorries and cars.

The Tribunal held that the reassessment proceedings were valid as the Assessing Officer had not examined the issue of determinate profit shares during the original assessment. It further held that the profit sharing among the AOP members was indeterminate, making Section 167B(1) applicable.

The Tribunal found that the CIT(A) did not provide a sufficient opportunity of being heard. Therefore, the case was remitted back to the CIT(A) for fresh adjudication on merits after giving due opportunity to the assessee.

The Tribunal held that the issue of whether the land was a capital asset or eligible for exemption under Section 10(37) required further inquiry. The matter was remitted back to the AO for fresh adjudication after proper verification.

The Tribunal held that the expenditure on TV films was not for the assessee's business and dismissed that ground. However, it directed the deletion of the disallowance under Section 14A, as no exempt income was earned.

The Tribunal held that the reassessment proceedings were valid as the Assessing Officer had not examined the issue of determinate profit shares during the original assessment. It further held that the profit sharing among the AOP members was indeterminate, making Section 167B(1) applicable.

The tribunal, following its own precedent for earlier assessment years, decided to remit the entire issue back to the Assessing Officer for re-examination. This includes the cash deposits and other investments like lorries and cars.