ITAT Delhi Judgments — April 2018

The Tribunal held that since the commission was paid to non-residents for services rendered outside India and no part of the income arose in India, TDS was not required to be deducted. Therefore, the disallowance under Section 40(a)(i) was not sustainable.

The Tribunal held that vehicle insurance is allowable as a revenue expenditure under Section 31(ii) of the IT Act. However, interest on loans for assets not put to use before the close of the previous year is not deductible as per the proviso to Section 36(1)(iii).

The Tribunal held that the assessee failed to demonstrate how opportunities of being heard were insufficient or how the additions were unjustified. The order under section 263 had attained finality, and the section 154 addition was a rectificatory measure.

The Tribunal held that the assessee failed to demonstrate how opportunities of being heard were insufficient or how the additions were unjustified. The order under section 263 had attained finality, and the section 154 addition was a rectificatory measure.

The Tribunal held that the Revenue failed to prove the benami allegation with cogent material evidence. The statements relied upon by the AO were insufficient and lacked corroboration, thus the additions were deleted.

The Tribunal held that the CIT erroneously invoked Section 263 powers for AY 2002-03, as the AO had examined the issues. However, for other assessment years, the CIT's action was found to be justified.

The Tribunal held that since the quantum addition under section 14A was set aside and restored to the Assessing Officer, no penalty under section 271(1)(c) could be levied. The subsequent assessment order also made a significantly reduced addition.

The Tribunal held that for Section 2(22)(e) to apply, the assessee must be a registered shareholder of the lending company. Since the assessee was not a registered shareholder of M/s. Pure Ganga Water Systems Pvt. Ltd., the conditions of the section were not met.

The Tribunal held that the vendor's letter was a completion certificate and did not indicate the assets were put to use after March 31, 2012. Other documents, including invoices for implementation charges and a vendor letter, indicated earlier usage.

The Tribunal upheld the deletion of penalty, stating that the assessee, being an elderly person, likely held a bona fide belief that the interest income was not separately taxable due to TDS. The decision followed a jurisdictional High Court precedent on similar facts.

The Tribunal held that the documents relied upon by the AO were not incriminating and did not establish a nexus with the assessee or the addition made. The statement of the director was also not considered incriminating material.

The Tribunal held that the CIT(A) erred in deleting the rejection of books of accounts and in allowing the full deduction under Section 80IC. The Tribunal also addressed disallowances made by the AO regarding expenses and interest income.

The Tribunal held that issuing a notice under section 143(2) prior to the filing of a valid return in response to a section 148 notice renders the reassessment void. The assessment order was quashed based on this violation.

The Tribunal held that disallowance under Rule 8D(2)(ii) is not sustainable when no borrowed funds were deployed to earn exempt income. The AO must record dissatisfaction with the assessee's explanation before invoking Rule 8D.

The Tribunal held that the gain from UTI Units was not interest income as the assessee had declared dividend income on an accrual basis. It also held that the property under construction could not be subjected to deemed rental income provisions, and the other property was used for business. The assessee's cross-objections were dismissed.

The Tribunal held that the mistake in not disallowing the expenses was inadvertent and due to manpower reduction caused by persistent business losses. The revised computation, filed after the issuance of notices but concerning items not specifically queried, was considered voluntary in nature.

The Tribunal held that reopening the assessment after four years without approval from the competent authority, when all facts were already on record during the original assessment, amounts to a change of opinion and is not permissible. The CIT(A)'s order was confirmed.

The Tribunal held that the issue was identical to those decided in favour of the assessee in preceding assessment years. Respectfully following the earlier orders of the Tribunal, the impugned order of the CIT(A) was upheld.

The Tribunal held that the Pr. CIT passed the order ex-parte in haste, violating the principle of natural justice ('audi alteram partem'). The Tribunal set aside the Pr. CIT's order and remanded the case back for adjudication after providing a due and reasonable opportunity of being heard to the assessee.

The Tribunal held that the addition on account of gross receipts needs further reconciliation between the assessee's books and Form 26AS, remanding it to the AO. The addition for works contract tax was also set aside and remanded to the AO for detailed examination of the reconciliation between books and VAT returns.

The Tribunal held that the reopening of the assessment was bad in law. The reassessment was based on an undated assessment order for a different assessment year and lacked tangible material directly linking the assessee to the alleged accommodation entries for the year under review.

The Tribunal held that the assessee failed to prove the identity of the parties from whom share application money was received, as notices sent to their addresses were returned unserved or no reply was received. The addresses provided were found to be bogus.

The Tribunal noted that as per CBDT Circular No. 21/2015, appeals with a tax effect below Rs. 10 lakhs should be withdrawn or not pressed. Consequently, the appeal was dismissed in limine.

The Tribunal held that reimbursement for lost equipment and communication charges should be included in gross receipts under Section 44BB, following earlier precedents. However, reimbursement of service tax was excluded from gross receipts.

The Tribunal held that the trust's activities, including running a hospital and pharmacy, were incidental to its predominant charitable objects of providing medical relief, education, and relief to the poor. Separate books of accounts were maintained, and profits were applied for charitable purposes, fulfilling the conditions of Section 11(4A).

The Tribunal set aside the impugned order and remitted the matter to the Assessing Officer. The AO is to examine the genuineness of an Agreement to Sell and its linkage to the cash deposits.

The Tribunal upheld the deletion of advertisement expenses additions, following previous precedents where similar additions were deleted due to lack of proper inquiry by the AO. For Section 14A, the matter was remanded to the AO to verify the assessee's original return and any suo motu disallowances.

The Tribunal upheld the deletion of advertisement expenses additions, following previous precedents where similar additions were deleted due to lack of proper inquiry by the AO. For Section 14A, the matter was remanded to the AO to verify the assessee's original return and any suo motu disallowances.