ITAT Chennai Judgments — September 2024

The Tribunal held that the cash interest income noted in the seized excel sheets had already been admitted and offered to tax by Shri Kamlesh Jain, a partner of the assessee firm, as his own undisclosed income. Therefore, the additions made by the AO to the assessee's income were unjustified and amounted to double addition.

The Tribunal held that the cash interest income noted in the seized excel sheets had already been admitted and offered to tax by Shri Kamlesh Jain, a partner of the assessee firm, as his own undisclosed income. Therefore, the additions made by the AO to the assessee's income were unjustified and amounted to double addition.

The Tribunal held that the services rendered by the assessee were not taxable in India as 'fee for included services' under the India-USA DTAA, nor as royalty under Section 9(1)(vii) of the Act. The issue of reconciliation of figures was restored to the AO.

The Tribunal held that the cash interest income noted in the seized excel sheets had already been admitted and offered to tax by Shri Kamlesh Jain, a partner of the assessee firm, as his own undisclosed income. Therefore, the additions made by the AO to the assessee's income were unjustified and amounted to double addition.

The Tribunal held that the cash interest income noted in the seized excel sheets had already been admitted and offered to tax by Shri Kamlesh Jain, a partner of the assessee firm, as his own undisclosed income. Therefore, the additions made by the AO to the assessee's income were unjustified and amounted to double addition.

The Tribunal held that the assessee's case was identical to a previous ruling where funds accumulated were utilized in the immediately succeeding financial year. Therefore, the addition made by the AO and upheld by the CIT(A) was deleted.

The Tribunal held that the PCIT's revisionary power under Section 263 was not permissible as the subject matter of the revision was already pending before the CIT(A). Citing the Hon'ble Madras High Court's decision, the Tribunal concluded that the PCIT cannot revise an assessment order when a larger issue is pending before the Commissioner of Appeal.

The Tribunal held that the assessee failed to establish that the cash advances received culminated into sales and were recorded in the books of accounts, as directed by the ITAT in its earlier order. Therefore, the order of the CIT(A) confirming the addition was found to be without infirmity.

The Tribunal held that the cash interest income noted in the seized excel sheets had already been admitted and offered to tax by Shri Kamlesh Jain, a partner of the assessee firm, as his own undisclosed income. Therefore, the additions made by the AO to the assessee's income were unjustified and amounted to double addition.

The Tribunal held that the cash interest income noted in the seized excel sheets had already been admitted and offered to tax by Shri Kamlesh Jain, a partner of the assessee firm, as his own undisclosed income. Therefore, the additions made by the AO to the assessee's income were unjustified and amounted to double addition.

The Tribunal held that the assessee failed to establish that the cash advances received culminated into sales and were recorded in the books of accounts, as directed by the ITAT in its earlier order. Therefore, the order of the CIT(A) confirming the addition was found to be without infirmity.

The Tribunal allowed the appeal regarding the disallowance of mark-to-market losses on current investments, stating they are not notional losses and are allowable. It also deleted the addition made by the Assessing Officer concerning interest cost on zero percent bonds, following Supreme Court and ITAT precedents.

The Tribunal held that the interest earned on investment in the Co-operative Society is eligible for deduction under section 80P(2)(d), but the interest earned from the savings bank account cannot be treated as income or dividend from investment. Since the assessee could not provide material to show the savings account amount was an investment, the CIT(A)'s order was upheld.

The Tribunal allowed the assessee's claim for mark-to-market losses on current investments, reversing the orders of the AO and CIT(A). The assessee's appeal was partly allowed, while the Revenue's appeal and the assessee's rectification appeal were dismissed.

The Tribunal held that the interest earned on investment in the Co-operative Society is eligible for deduction under section 80P(2)(d), but the interest earned from the savings bank account cannot be treated as income or dividend from investment. Since the assessee could not provide material to show the savings account amount was an investment, the CIT(A)'s order was upheld.

The Tribunal upheld the PCIT's order, stating that the amendment to Section 40(a)(ia) by the Finance (No.2) Act, 2014, is prospective. The Assessing Officer was directed to make a fresh assessment, considering whether TDS liability was applicable.

The Tribunal allowed the assessee's claim for mark-to-market losses on current investments, reversing the orders of the AO and CIT(A). The assessee's appeal was partly allowed, while the Revenue's appeal and the assessee's rectification appeal were dismissed.

The Tribunal held that the delay in filing Form 10B was minimal and primarily due to technical glitches and uncertainties in due dates, exacerbated by the Covid-19 pandemic. Considering these factors and the CBDT's circulars allowing condonation of delay, the delay in verification deserves to be ignored in the interest of justice.

The Tribunal admitted the additional grounds, holding that jurisdiction is fundamental to any order. The Tribunal found that the PCIT's revisionary order was passed without proper jurisdiction over the TPO's order, rendering it void ab initio.

The Tribunal held that the cash interest income noted in the seized excel sheets had already been admitted and offered to tax by Shri Kamlesh Jain, a partner of the assessee firm, as his own undisclosed income. Therefore, the additions made by the AO to the assessee's income were unjustified and amounted to double addition.

The Tribunal held that the difference between the issue price and fair market value was only 0.65%, which falls within the 10% tolerance limit provided by Rule 11UA. Therefore, the AO's order was not erroneous or prejudicial to the revenue.

The Tribunal held that weighted deduction on R&D expenses is allowable once the facility is approved by DSIR, irrespective of DSIR's quantification of expenditure for the relevant assessment year. The Tribunal also upheld the CIT(A)'s decision to allow depreciation on UPS at 60% as part of computer accessories.

The Tribunal held that entire credits cannot be added without considering withdrawals, as it is an established principle. Following the precedent of the Madras High Court, the addition was restricted based on the peak credit working.

The CIT(A) reduced the addition to Rs. 22,84,069/- by considering the cash book entries and the nature of the business. However, the Tribunal noted that the CIT(A) did not consider the opening cash balance as on 07.09.2017. The Tribunal directed the Assessing Officer to examine the cash book for the whole year and satisfy the opening cash balance.

The Tribunal held that weighted deduction on R&D expenses is allowable once the facility is approved by DSIR, irrespective of DSIR's quantification of expenditure for the relevant assessment year. The Tribunal also upheld the CIT(A)'s decision to allow depreciation on UPS at 60% as part of computer accessories.

The Tribunal allowed weighted deduction on R&D expenditure, following its own prior decision. It also accepted the alternate submission for allowing forex loss deduction in the year it is charged to P&L. The Tribunal upheld the CIT(A)'s decision regarding non-deduction of TDS on foreign payments based on DTAA provisions.

The Tribunal held that the seized material lacked specific details and nexus to the assessee, and the primary statement relied upon was retracted. Therefore, the addition made by the Assessing Officer was not justified.

The Tribunal found that for cash deposits, the assessee had provided some evidence but failed to establish the nature of furniture sold. For rental advance and amount payable, there was no change in the figures from the previous year, making the additions unsustainable. The share of profit addition was also found to be unsubstantiated.

The Tribunal held that the PCIT erred in invoking revisional jurisdiction based on the omission to initiate penalty proceedings. It was found that the PCIT had distorted the assessment order by alleging a finding of concealed income, which was not present in the original assessment. The Tribunal relied on decisions from the Madras High Court.

The Tribunal held that the PCIT erred in invoking revisional jurisdiction based on the omission to initiate penalty proceedings. It was found that the PCIT had distorted the assessment order by alleging a finding of concealed income, which was not present in the original assessment. The Tribunal relied on decisions from the Madras High Court.

The Tribunal held that the PCIT erred in invoking revisional jurisdiction based on the omission to initiate penalty proceedings. It was found that the PCIT had distorted the assessment order by alleging a finding of concealed income, which was not present in the original assessment. The Tribunal relied on decisions from the Madras High Court.

The Tribunal held that the seized material lacked specific details and a nexus with the assessee, and the retracted statement could not be relied upon. Therefore, the addition made by the AO was not justified.

The Tribunal held that the Supreme Court's decision in the case of State Bank of India against M/s. Accord Life Spec Private Limited confirmed the NCLT order approving the Resolution Plan, which settled income-tax liabilities at NIL value. Consequently, the penalty imposed under section 271(1)(c) of the Act was deemed to not survive and was deleted.

The Tribunal held that the Supreme Court's decision in the case of State Bank of India against M/s. Accord Life Spec Private Limited confirmed the NCLT order approving the Resolution Plan, which settled income-tax liabilities at NIL value. Consequently, the penalty imposed under section 271(1)(c) of the Act was deemed to not survive and was deleted.

The Tribunal held that the penalty orders were passed beyond the limitation period prescribed under Section 275(1)(c) of the Act. Therefore, the penalties were quashed.

The Tribunal held that the penalty orders were passed beyond the limitation period prescribed under Section 275(1)(c) of the Act. Therefore, the penalties were quashed.

The Tribunal held that the penalty orders were passed beyond the limitation period prescribed under Section 275(1)(c) of the Act. Therefore, the penalties were quashed.

Despite the assessee's negligence, the Tribunal accepted the prayer to restore the issue of the Rs. 54.60 Lacs SBN deposit addition back to the AO for de novo adjudication, imposing a cost of Rs. 5,000.

The Tribunal allowed weighted deduction on R&D expenditure, following its own prior decision. It also accepted the alternate submission for allowing forex loss deduction in the year it is charged to P&L. The Tribunal upheld the CIT(A)'s decision regarding non-deduction of TDS on foreign payments based on DTAA provisions.

The Tribunal condoned the delay, citing the principle of natural justice, despite the assessee's negligence. The appeal was restored to the CIT(A) for de novo adjudication with a direction to the assessee to substantiate its case.

Despite the assessee's negligence, the tribunal restored the appeal to the CIT(A) for fresh adjudication in the interest of natural justice. The assessee was directed to properly substantiate its case.

The Tribunal, considering the principle of natural justice and the assessee's negligence, restored the assessment to the Assessing Officer. This is subject to the assessee depositing Rs. 5,000/- to the Tamil Nadu State Legal Services Authority within 30 days.

The Tribunal held that incentives received by exporters for exploring new markets are capital receipts and not taxable as business income. This decision was based on previous orders in similar cases.

The Tribunal held that the incentive received by the assessee, specifically under the Market Linked Focus Products Scheme (MLFPS), is a capital receipt and not taxable. The reasoning was based on the principle that these incentives were granted to offset infrastructural inefficiencies and associated costs, thereby providing exporters with a level playing field, rather than being a direct payment for services rendered or a profit from business operations. The Tribunal applied the principle of ejusdem generis to interpret Section 2(24)(xviii) of the Income Tax Act, concluding that the term 'reward' was not encompassed within the scope of 'assistance', 'subsidy', 'grant', or 'cash incentive' as listed in the section. The Tribunal found that the incentives were not in the nature of revenue receipts as contemplated by Section 28(iiib) of the Act. Therefore, the additions made by the Assessing Officer on this account were deleted. The Tribunal did not expressly leave any issue undecided. The operative direction was the deletion of the additions made by the Assessing Officer.

The Tribunal confirmed the CIT(A)'s order, holding that the assessment was indeed barred by limitation. The reference to the Transfer Pricing Officer was made late, and the subsequent assessment order was passed after the extended due date.

The Tribunal found that both the Assessing Officer and the CIT(A) passed orders without giving the assessee an opportunity to be heard. Therefore, to meet the ends of justice, the appeal was remitted back to the Assessing Officer for fresh adjudication.

The Tribunal found that both issues require verification by the Assessing Officer (AO). The impugned order was set aside, and the issues were restored to the AO for adjudication on merits after providing the assessee an opportunity to be heard.

The Tribunal held that the period of holding of the asset should include the period the company held it, thus confirming the CIT(A)'s view that the gains were long-term. The Tribunal also agreed with the CIT(A) that Section 50C was not applicable as there was no transfer of a capital asset by the assessee.

The Tribunal noted that the tax effect involved in the appeal was Rs. 51,54,120/-, which is below the revised threshold limit of Rs. 60 lakhs for filing appeals before the ITAT, as per CBDT circular. Therefore, the appeal was not maintainable.

The Tribunal accepted the assessee's contention that the appeal was not maintainable as the tax effect was below the threshold specified in the CBDT circular. The Revenue's counsel conceded to the applicability of the circular.