ITAT Delhi Judgments — April 2019

The Tribunal held that since no incriminating material was found during the search and the assessment was not abated, additions under Section 153A could not be sustained. The seized documents belonged to the investor companies and were statutory registers, not incriminating material against the assessee.

The Tribunal held that the overseas branches of the assessee were engaged in rendering on-site software development services, and the profits derived from these services qualified for deduction under Section 10A. The reassessment proceedings were also found to be based on a 'change of opinion'.

The Tribunal held that the overseas branches of the assessee were engaged in rendering on-site software development services, and the profits derived from these services qualified for deduction under Section 10A. The reassessment proceedings were also found to be based on a 'change of opinion'.

The Tribunal upheld the deletion of the addition for non-deduction of TDS, finding the CIT(A) justified based on payee's IT returns. However, the addition for cash payments under Section 40A(3) was restored to the AO for further verification regarding Rule 6DD(k).

The Tribunal held that since no incriminating material was found during the search and the assessment was not abated, additions under Section 153A could not be sustained. The seized documents belonged to the investor companies and were statutory registers, not incriminating material against the assessee.

The Tribunal held that hostel and transport facilities provided to students are incidental to the main object of providing education and not independent businesses. It also ruled that depreciation is a necessary charge in computing income and disallowed by the AO was incorrect.

The Tribunal found merit in the assessee's alternate submission that the matter be restored to the Assessing Officer. This was due to a newly submitted certificate confirming the agreement date, which was not before the lower authorities.

The Tribunal held that since no incriminating material was found during the search and the assessment was not abated, additions under Section 153A could not be sustained. The seized documents belonged to the investor companies and were statutory registers, not incriminating material against the assessee.

The Tribunal held that since no incriminating material was found during the search and the assessment was not abated, additions under Section 153A could not be sustained. The seized documents belonged to the investor companies and were statutory registers, not incriminating material against the assessee.

The Tribunal held that the overseas branches of the assessee were engaged in rendering on-site software development services, and the profits derived from these services qualified for deduction under Section 10A. The reassessment proceedings were also found to be based on a 'change of opinion'.

The Tribunal held that Section 54F does not stipulate that construction must begin after the sale of the original asset. The Delhi High Court's decision in CIT vs. Bharti Mishra was relied upon, which confirmed that commencing construction before the sale of the original asset does not disentitle the assessee to the deduction.

The Tribunal held that mobilization charges and reimbursement of expenses are includible in gross receipts for the purpose of Section 44BB. This decision was based on a prior ruling by the Tribunal in the assessee's own case for the preceding assessment year, which followed the Supreme Court's decision in Sedco Forex International Incorporation.

The Tribunal held that the issue of foreign exchange loss was squarely covered by a co-ordinate bench's decision for the preceding assessment year. Following that precedent, the Tribunal found no merit in the disallowance.

The Tribunal held that the severe financial crisis faced by the assessee, evidenced by its bank account being declared NPA, project cancellations, and retrenchment, constituted a reasonable cause for the delay. Consequently, the penalty was deleted.

The Tribunal held that the approval for reopening was granted mechanically without due application of mind, citing a Delhi High Court judgment. Consequently, the reassessment order was quashed as being bad in law.

The ITAT restored the appeal to the CIT(A) for a fresh adjudication, granting one more opportunity of hearing to the assessee. This was subject to the assessee paying a cost of Rs. 1000/-.

The Tribunal held that Section 68 additions can only be made for sums credited *during* the year. Since there were no fresh credits for most of the creditors, a significant portion of the addition was deleted. However, a small portion was confirmed.

The Tribunal held that AMP expenditure, reimbursed by the Associated Enterprise (AE), constitutes an international transaction. However, it found the Bright Line Test (BLT) applied by the TPO to be inappropriate for benchmarking and directed a fresh computation of the Arm's Length Price (ALP). Certain expenses like trade discounts and freight were also to be excluded.

The Tribunal held that making a claim which is not sustainable in law does not automatically amount to furnishing inaccurate particulars of income. The assessee's claim was bonafide and consistent, as they offered the escrow amount for tax in subsequent years upon receipt.

The Tribunal held that the CIT(A) rightly deleted the levy of interest under section 234B, following the Delhi High Court's decision in GE Packaged Power Inc. The pendency of a review petition by the Revenue before the Supreme Court did not warrant a contrary view.

The Tribunal held that the issue was squarely covered in favor of the assessee by its own previous decision for Assessment Year 2009-10. Since the facts for the current year were identical, the CIT(A)'s order deleting the addition was upheld.

The Tribunal upheld the deletion of penalties. For AY 2007-08, the penalty was deleted because the Assessing Officer failed to record satisfaction for initiating penalty proceedings in the assessment order. For AY 2008-09, the Tribunal agreed that mere rejection of claims made bonafidely, with full disclosure of particulars, does not constitute furnishing inaccurate particulars.

The Tribunal held that expenses excluded from export turnover must also be excluded from total turnover when calculating Section 10A deduction, following Supreme Court and CBDT pronouncements. The AO was directed to recompute the deduction accordingly.

The Tribunal upheld the deletion of penalties. For AY 2007-08, the penalty was deleted because the Assessing Officer failed to record satisfaction for initiating penalty proceedings in the assessment order. For AY 2008-09, the Tribunal agreed that mere rejection of claims made bonafidely, with full disclosure of particulars, does not constitute furnishing inaccurate particulars.

The Tribunal held that since no incriminating material was found during the search and the assessment was not abated, additions under Section 153A could not be sustained. The seized documents belonged to the investor companies and were statutory registers, not incriminating material against the assessee.

The Tribunal held that the CIT(A) erred in dismissing the appeal ex-parte as the law obliges the CIT(A) to decide appeals on merits after affording a proper opportunity. The case was restored to the CIT(A) for de-novo adjudication.

The Tribunal held that the Assessing Officer lacked jurisdiction to reopen the assessment as the reopening was initiated after four years without any tangible material to show the assessee's failure to disclose full and true particulars. The reopening was based solely on information from the Investigation Wing without independent application of mind or corroborating evidence.

The Tribunal held that the cash found was explainable from the cash book abstracts of the assessee's concerns and the additional income surrendered would cover any discrepancies. Therefore, the addition made by the Assessing Officer was deleted.

The Tribunal held that the assessee trust's objects fall within providing medical relief, education, or relief to the poor, and thus the proviso to Section 2(15) is not attracted. The appeal by the Revenue was dismissed.

The Tribunal noted the absence of the assessee and the lack of any request for adjournment. Considering the assessee's apparent lack of interest in prosecuting the appeal, the Tribunal dismissed the appeal.

The Tribunal held that the Revenue's appeal was not maintainable as the tax effect of the addition was less than Rs. 20,00,000/-, which is the monetary limit for filing appeals before the Tribunal as per CBDT Circular No. 3/2018. The appeal was dismissed on this procedural ground.

The Tribunal held that the denial of depreciation deduction from the estimated net profit depends on the basis adopted by the AO. Since the issue of business turnover was restored to the AO, the matter of depreciation deduction was also restored to the AO for fresh decision.

The Tribunal held that the penalty proceedings were vitiated because the AO's show cause notice failed to specify whether the penalty was for concealment of income or furnishing inaccurate particulars of income. Therefore, no penalty was leviable.

The Tribunal restored the appeal to the CIT(A) for fresh adjudication, granting one more opportunity to the assessee. This was done to render substantial justice, subject to the assessee paying a cost of Rs. 1000.

The Tribunal held that the assessee's explanation for the cash found was supported by the balance sheet of the partnership firm. Therefore, the addition made by the authorities below was unjustified.

The Tribunal upheld the CIT(A)'s order, which restricted the addition to the peak credit in the bank accounts and estimated profit at 5% of the total undisclosed cash deposits. The Tribunal found the CIT(A)'s approach to be reasoned and supported by various judicial precedents.

The Tribunal held that the Revenue failed to prove that the conditional agreements to sell were acted upon or that the balance amount was paid. The addition of Rs. 4,85,74,816/- was deleted, but the issue of Rs. 50 lakhs was remanded to the CIT(A) for re-adjudication.

The Tribunal confirmed the exclusion of Dynalog (India) Ltd. as a comparable, finding it functionally different from the assessee. Regarding Bose Corporation India P. Ltd., the Tribunal upheld the DRP's direction to reduce its GP rate to account for functional dissimilarities.

The Tribunal held that the reassessment proceedings were invalid because the approval for reopening the assessment under Section 151 was granted mechanically without proper application of mind by the approving authority. Consequently, the other grounds raised by the assessee were not adjudicated.

The Tribunal set aside the CIT(A)'s order and remanded the matter back to the CIT(A) with directions to admit the appeal if the assessee establishes a loss and is not liable for advance tax, and to decide on merits otherwise.

The Tribunal held that the assessee's absence indicates a lack of interest in pursuing the appeal. Following established precedents, the appeal is dismissed for want of prosecution.

The Tribunal held that an unsigned agreement to sell, found from a third party and not signed by the assessee or the other party, has no evidentiary value. The reopening of assessment was based on inadmissible evidence and lacked a live link between the material and the AO's belief of escaped income.

The Tribunal found that similar issues for previous assessment years were decided in favor of the assessee by coordinate benches. Following these precedents, the Tribunal remanded the transfer pricing issue back to the TPO for a fresh decision. Regarding the classification of expenditure as capital or revenue, the Tribunal noted it was not decided in the final assessment order.

The Tribunal held that the High Court's order constituted a direction to tax the deemed dividend in the hands of the shareholders, making the reassessment proceedings under Section 148 not barred by limitation. The Tribunal also upheld the addition of deemed dividend under Section 2(22)(e) in the hands of the assessees.

The Tribunal held that the appeal should not have been filed or should have been withdrawn as the tax effect was below the prescribed limit. Therefore, the appeal was dismissed without going into the merits of the case.

The Tribunal held that the Revenue failed to prove that the conditional agreements to sell were acted upon or that the balance amount was paid. The addition of Rs. 4,85,74,816/- was deleted, but the issue of Rs. 50 lakhs was remanded to the CIT(A) for re-adjudication.

The tribunal is rectifying a typographical mistake in the cause title of its earlier order. The dates of hearing and pronouncement are corrected to April 29, 2019.

The Tribunal dismissed the Revenue's appeal regarding stock valuation, finding that the assessee had provided sufficient documentation and the Assessing Officer had not raised adverse comments. For the loan waiver issue, the Tribunal remanded the matter back to the Assessing Officer for reconsideration.

The tribunal noted the assessee's request to withdraw the appeal. Consequently, the appeal was dismissed as withdrawn.