ITAT Delhi Judgments — October 2018

The Tribunal held that an appeal requires effective prosecution, not just filing. Since the assessee was absent and showed no interest in pursuing the appeal, it was dismissed for non-prosecution.

The ITAT held that the CIT(A) erred in dismissing the appeal in limine for non-prosecution without proper service of notices and without deciding the appeal on merits. The tribunal emphasized that the CIT(A) is obligated to dispose of appeals on merits after providing a reasonable opportunity of being heard.

The Tribunal held that the assessee's conduct indicated a lack of interest in prosecuting the appeal. Therefore, the appeal was dismissed for non-prosecution.

The Tribunal noted that the tax effect in the appeal was below the monetary limit prescribed by CBDT Circular No. 3 of 2018. Consequently, the Revenue's Senior DR did not press the appeal.

The Tribunal held that reassessment proceedings initiated and the consequent assessment order passed in the name of a dissolved company are void ab initio and invalid in law. The existence of an assessee is essential for a valid assessment.

The Tribunal held that gains from the sale of shares and mutual funds should be treated as capital gains, not business income, especially when held as investments for longer periods. The Tribunal also affirmed the deletion of deemed dividend additions in the hands of the firm, finding them to be commercial transactions.

The Tribunal held that gains from the sale of shares and mutual funds should be treated as capital gains, not business income, especially when held as investments for longer periods. The Tribunal also affirmed the deletion of deemed dividend additions in the hands of the firm, finding them to be commercial transactions.

The Tribunal held that a mere fall in the net profit rate is not a ground to increase the profit rate, especially when the AO did not find any defects in the documents submitted by the assessee or reject the books of account.

The Tribunal noted that the CBDT circular mandates that appeals with a tax effect below Rs. 20 lakhs should not be filed or pressed. The Senior DR did not press the appeal in light of this circular.

The Tribunal held that as per CBDT Circular No. 3 of 2018, the Department should not file appeals before the Tribunal if the tax effect does not exceed Rs. 20 lakhs. This instruction applies retrospectively to pending appeals.

The Tribunal noted that the assessee's claim of STT payment was contradictory and lacked documentary evidence. However, to ensure justice, the issue was remanded back to the Assessing Officer for fresh verification.

The Tribunal held that for payments to public sector undertakings, the assessee's belief of non-deduction was bonafide and for a reasonable cause, thus setting aside the demand under Section 201(1) and 201(1A) with directions to the AO. For payments to STC, the matter was remanded to the AO to examine invoices and determine tax liability on service charges.

The Tribunal held that for payments to public sector undertakings, the assessee's belief of non-deduction was bonafide and for a reasonable cause, thus setting aside the demand. For payments to STC, the matter was remanded to the AO to examine invoices and determine tax liability on service charges.

The Tribunal held that for payments to public sector undertakings, the assessee's belief of non-deduction was bonafide and for a reasonable cause, thus setting aside the demand. For payments to STC, the matter was remanded to the AO to examine invoices and determine tax liability on service charges.

The Tribunal held that as per CBDT Circular No. 3 of 2018, the Department should not file appeals before the Tribunal if the tax effect does not exceed Rs. 20 lakhs. This instruction applies retrospectively to pending appeals.

The Tribunal held that the penalty under Section 271AAA was not leviable as no specific query was put to the assessee during the search regarding the manner of earning the income, and the assessee had surrendered the income and paid taxes.

The Tribunal confirmed the addition made by the AO, holding that the assessee failed to substantiate her claim of agricultural income due to non-cooperation and lack of evidence. The CIT(A)'s order was upheld.

The Tribunal held that for payments to public sector undertakings, the assessee's belief of non-deduction was bonafide and for a reasonable cause, thus setting aside the demand. For payments to STC, the matter was remanded to the AO to examine invoices and determine tax liability on service charges.

The Tribunal held that as per CBDT Circular No. 3 of 2018, the Department should not file appeals before the Tribunal if the tax effect does not exceed Rs. 20 lakhs. This instruction applies retrospectively to pending appeals.

The Tribunal held that as per CBDT Circular No. 3 of 2018, the Department should not file appeals before the Tribunal if the tax effect does not exceed Rs. 20 lakhs. This instruction applies retrospectively to pending appeals.

The ITAT held that the CIT(A) should have decided the appeal on merits, even in the absence of the assessee, by providing reasons for the decision. Dismissing solely for non-prosecution was not sustainable.

The Tribunal held that for payments to public sector undertakings, the assessee's belief of non-deduction was bonafide and for a reasonable cause, thus setting aside the demand. For payments to STC, the matter was remanded to the AO to examine invoices and determine tax liability on service charges.

The Tribunal held that penalty under Section 271(1)(c) cannot be levied on protective additions. The appeals related to penalty were set aside to the Assessing Officer for determination if any amount was not considered in Mr. Garg's hands, and if so, to levy penalty on the profit thereof.

The Tribunal held that penalty under Section 271(1)(c) cannot be levied on protective additions. The appeals related to penalty were set aside to the Assessing Officer for determination if any amount was not considered in Mr. Garg's hands, and if so, to levy penalty on the profit thereof.

The Tribunal held that penalty under Section 271(1)(c) cannot be levied on protective additions. The appeals related to penalty were set aside to the Assessing Officer for determination if any amount was not considered in Mr. Garg's hands, and if so, to levy penalty on the profit thereof.

The Tribunal held that penalty under Section 271(1)(c) cannot be levied on protective additions. The appeals related to penalty were set aside to the Assessing Officer for determination if any amount was not considered in Mr. Garg's hands, and if so, to levy penalty on the profit thereof.

The Tribunal held that the disallowance of commission and incentive was not justified. It noted that the issue was covered by a co-ordinate bench decision in favour of the assessee's sister concern, where similar submissions regarding the nature of services, payment through cheques, TDS deduction, and evidence like a lower deduction certificate were accepted.

The Tribunal held that as per CBDT Circular No. 3 of 2018, the Department should not file appeals before the Tribunal if the tax effect does not exceed Rs. 20 lakhs. This instruction applies retrospectively to pending appeals.

The Tribunal dismissed the grounds related to the 80IB deduction, stating it was decided against the assessee in a prior year. However, it remanded the issues of pro-rata interest on loans and short-term capital gains back to the Assessing Officer for fresh adjudication.

The Tribunal noted that the tax effect was below the revised monetary limit prescribed by the CBDT circular. Consequently, the Tribunal dismissed the appeal without going into the merits of the case.

The Tribunal held that the assessee-society had used accumulated funds for charitable and educational purposes by purchasing land. Non-use of land does not equate to non-charitable use, and the AO failed to prove otherwise.

The Tribunal held that the TPO's reallocation of expenses for the home base segment was not justified and directed the exclusion of certain companies from the comparable list for MSS. The Tribunal also directed the Assessing Officer to verify and treat the returned income correctly.

The Tribunal held that the assessee's conduct indicated a lack of interest in prosecuting the appeal. Therefore, the appeal was dismissed for non-prosecution.

The ITAT held that the CIT(A) failed to decide the appeal on merits and provide reasons for the decision as required by Section 250(6) of the IT Act. The order of the CIT(A) was set aside.

The Tribunal held that the assessee's failure to appear and prosecute the appeal indicates a lack of interest. Therefore, the appeal was liable to be dismissed for non-prosecution.

The Tribunal held that foreign exchange gain/loss should be considered operating income and rejected the assessee's claim for risk adjustment and working capital adjustment due to lack of evidence and proper substantiation.

The tribunal held that the appeal was not being prosecuted by the assessee. Citing various judicial precedents, the tribunal dismissed the appeal for non-prosecution.

The Tribunal noted that the quantum addition of Rs. 15 lakhs had been deleted in a separate appeal. Since the addition was deleted, the penalty levied on it had no basis.

The Tribunal held that the assessee-society had used accumulated funds for charitable and educational purposes by purchasing land. Non-use of land does not equate to non-charitable use, and the AO failed to prove otherwise.

The Tribunal held that notional interest on interest-free security deposits cannot be added to the annual letting value. It also ruled that Section 50C of the Income Tax Act was not applicable for determining capital gains in this case, and restored the AO's computation of capital gains. The addition under Section 2(22)(e) was deleted as the deposits were considered sale consideration for property rights.

The Tribunal, following its previous orders on similar issues for earlier assessment years, remanded the matter back to the Assessing Officer/TPO. The TPO was directed to first determine whether the payments were under a Cost Sharing Arrangement or for intra-group services, and then decide the most appropriate method for determining the ALP, prioritizing the Comparable Uncontrolled Price (CUP) method.

The Tribunal held that the assessee had discharged the initial onus to prove the identity, creditworthiness, and genuineness of the transaction, especially as the facts were identical to the case of the assessee's husband. The addition on account of unexplained loan was deleted.

The Tribunal upheld the disallowance made by the Assessing Officer and the enhancement made by the CIT(A) under Section 36(1)(iii), finding that the assessee failed to prove that advances to sister concerns were for business purposes. The issue regarding Section 14A was not explicitly detailed in the provided excerpt for a definitive holding.

The Tribunal held that notional interest on interest-free security deposits cannot be added to the annual letting value. It also ruled that Section 50C of the Income Tax Act was not applicable for determining capital gains in this case, and restored the AO's computation of capital gains. The addition under Section 2(22)(e) was deleted as the deposits were considered sale consideration for property rights.

The Tribunal held that the penalty notice was invalid because it did not specify whether the penalty was for concealment of income or furnishing inaccurate particulars. Relying on the Supreme Court's decision in SSA's Emerald Meadows, the Tribunal quashed the penalty.

The Tribunal held that the addition on account of excess stock was not justified as the assessee provided evidence of receiving items free of cost. The disallowance of advertisement expenses was deleted, following a previous year's decision where similar disallowances were deleted by the Tribunal.