ITAT Delhi Judgments — August 2017

The Tribunal held that the assessee had bona fide reasons for not disclosing the rental income from the Gurgaon property, as it was offered in the subsequent year based on their cash accounting method. Similarly, the non-disclosure of Ghaziabad rental income and the disallowance under Section 14A were not considered sufficient to attract penalty.

The Tribunal held that duty drawback receipts are to be included in the computation of deduction under Section 10B, to be apportioned as per the formula in Section 10B(4). The Supreme Court's decision in Liberty India Ltd. concerning Section 80IB was distinguished and found not applicable to Section 10B.

The Tribunal held that sugarcane development expenses are not related to the assessee's own agricultural income but are incurred for the development of farmers in the command area as per government mandate. Such expenses have consistently been allowed in earlier years and are eligible for deduction.

The Tribunal held that the assessee had reasonable cause for non-compliance due to the detention of a key person and the overwhelming number of group assessments. The Tribunal also noted that the demand in quantum proceedings was reduced to nil, rendering the non-compliance technical.

The Tribunal held that duty drawback receipts are to be considered as part of business income and are eligible for deduction under Section 10B, to be computed as per the formula in Section 10B(4). The Supreme Court's decision in Liberty India Ltd. regarding Section 80IB was distinguished and held not applicable to Section 10B.