ITAT Delhi Judgments — August 2017

The Tribunal upheld the CIT(A)'s decision to delete the addition of salary income. It held that the salary was exempt under Section 10(6)(ii) of the Income Tax Act and Article 19(1)(a) of the Indo-Japan DTAA, as the assessee was an official of a foreign state's trade representation.

The Tribunal found that the Assessing Officer and CIT(A) did not properly examine the nature of technical know-how fees and deferred revenue expenditure. The matter was remanded back to the Assessing Officer for verification of whether the expenditure was revenue in nature.

The Tribunal found that the CIT(A) had passed an ex-parte order. Considering the assessee's undertaking to cooperate, the Tribunal remitted the issues back to the CIT(A) for fresh adjudication.

The Tribunal found that the Assessing Officer and CIT(A) did not properly examine the nature of technical know-how fees and deferred revenue expenditure. The matter was remanded back to the Assessing Officer for verification of whether the expenditure was revenue in nature.

The Tribunal held that the CIT(A) correctly admitted additional evidence and properly appreciated the facts to allow deductions under Sections 80IB and 80IC. The disallowance under Section 40(a)(ia) was also found to be unwarranted.

The Tribunal dismissed the appeal filed by the Revenue. This was based on the fact that the tax effect of the disputed issue was below Rs 10 lakhs, as per CBDT Circular No. 21/2015.