ITAT Delhi Judgments — June 2019

The Tribunal held that the assessees had entered into genuine transactions of sale and purchase of shares, supported by documentary evidence. The Tribunal found that the SEBI's subsequent orders absolved the companies, and the material relied upon by the revenue was either not confronted or not specific to the assessees.

The Tribunal held that the reassessment proceedings were void as they were not based on tangible material. The addition in a subsequent year did not constitute tangible material for reopening, especially when the issue was accepted in a prior year.

The Tribunal held that common addresses of companies do not automatically invalidate transactions, especially when supported by documentary evidence. It also found that the debenture transaction was genuine and supported by evidence, and the revenue failed to rebut it.

The Tribunal held that the reassessment proceedings were not challenged on specific grounds before it, and thus, the assessee's grounds related to the validity of reassessment were not adjudicated. Regarding additions made on the basis of material collected at the back of the assessee, the Tribunal noted that the CIT(Appeals) had deleted certain additions after considering remand reports and evidence, and these findings were not controverted. The Tribunal upheld the CIT(Appeals)'s deletion of additions amounting to Rs. 9,59,321/- (pertaining to campus school expenses) and Rs. 4,28,693/- (due to debiting under a wrong head), reasoning that actual expenditure incurred cannot be disallowed due to wrong posting. The Tribunal also upheld the deletion of addition of Rs. 1,40,64,916/- on account of payment to M/s Ansal House Construction, as the assessee provided supporting evidence and the expenditure was on capital account. The addition on account of investment in FDR (Rs. 1,35,19,70,96/-) was deleted by the CIT(Appeals), and this was upheld by the Tribunal, following its reasoning on a similar issue in assessee's appeal. The Tribunal upheld the CIT(Appeals)'s decision to allow depreciation on the building, as its existence and use were not in dispute. The Tribunal dismissed the Revenue's grounds concerning processing charges and expenditure not supported by bills, as the CIT(Appeals)'s findings were not controverted. The Tribunal partly allowed the assessee's appeal for statistical purposes and dismissed the Revenue's appeal.

The Tribunal held that the reassessment proceedings were not challenged on specific grounds before it, and thus, the assessee's grounds related to the validity of reassessment were not adjudicated. Regarding additions made on the basis of material collected at the back of the assessee, the Tribunal noted that the CIT(Appeals) had deleted certain additions after considering remand reports and evidence, and these findings were not controverted. The Tribunal upheld the CIT(Appeals)'s deletion of additions amounting to Rs. 9,59,321/- (pertaining to campus school expenses) and Rs. 4,28,693/- (due to debiting under a wrong head), reasoning that actual expenditure incurred cannot be disallowed due to wrong posting. The Tribunal also upheld the deletion of addition of Rs. 1,40,64,916/- on account of payment to M/s Ansal House Construction, as the assessee provided supporting evidence and the expenditure was on capital account. The addition on account of investment in FDR (Rs. 1,35,19,70,96/-) was deleted by the CIT(Appeals), and this was upheld by the Tribunal, following its reasoning on a similar issue in assessee's appeal. The Tribunal upheld the CIT(Appeals)'s decision to allow depreciation on the building, as its existence and use were not in dispute. The Tribunal dismissed the Revenue's grounds concerning processing charges and expenditure not supported by bills, as the CIT(Appeals)'s findings were not controverted. The Tribunal partly allowed the assessee's appeal for statistical purposes and dismissed the Revenue's appeal.

The Tribunal addressed the appeals concerning section 263 orders first. It held that the Commissioner was justified in initiating proceedings under section 263 because the Assessing Officer had not made sufficient inquiry into the expenses claimed against interest income. The Tribunal noted that many claimed expenses, such as bank charges, brokerage, and vehicle expenses, prima facie did not appear to be related to earning interest income. The Tribunal also upheld the CIT(A)'s estimation of expenses relatable to interest income, as the assessee failed to provide details of expenses incurred solely for earning interest income. Consequently, the orders passed under section 263 for AY 1998-99 and 1999-2000 were upheld, and the corresponding appeals were dismissed. For the other seven appeals, the Tribunal noted that the grounds raised were common and involved issues like eligibility for section 10(20A) exemption and allowability of various expenses. The judgment indicates these appeals were partly allowed, except for AY 1996-97 which was dismissed.

The Tribunal held that the assessees had entered into genuine transactions of sale and purchase of shares, supported by documentary evidence. The Tribunal found that the SEBI's subsequent orders absolved the companies, and the material relied upon by the revenue was either not confronted or not specific to the assessees.

The Tribunal held that the STCG could not be treated as bogus solely based on the fact that the scrips were identified in an investigation of entry providers. The Assessing Officer failed to provide specific material to link the assessee to sham transactions or accommodation entries.

The Tribunal held that the reassessment proceedings were not challenged on specific grounds before it, and thus, the assessee's grounds related to the validity of reassessment were not adjudicated. Regarding additions made on the basis of material collected at the back of the assessee, the Tribunal noted that the CIT(Appeals) had deleted certain additions after considering remand reports and evidence, and these findings were not controverted. The Tribunal upheld the CIT(Appeals)'s deletion of additions amounting to Rs. 9,59,321/- (pertaining to campus school expenses) and Rs. 4,28,693/- (due to debiting under a wrong head), reasoning that actual expenditure incurred cannot be disallowed due to wrong posting. The Tribunal also upheld the deletion of addition of Rs. 1,40,64,916/- on account of payment to M/s Ansal House Construction, as the assessee provided supporting evidence and the expenditure was on capital account. The addition on account of investment in FDR (Rs. 1,35,19,70,96/-) was deleted by the CIT(Appeals), and this was upheld by the Tribunal, following its reasoning on a similar issue in assessee's appeal. The Tribunal upheld the CIT(Appeals)'s decision to allow depreciation on the building, as its existence and use were not in dispute. The Tribunal dismissed the Revenue's grounds concerning processing charges and expenditure not supported by bills, as the CIT(Appeals)'s findings were not controverted. The Tribunal partly allowed the assessee's appeal for statistical purposes and dismissed the Revenue's appeal.

The Tribunal found merit in the assessee's argument that a portion of the disallowed amount related to a previous assessment year and was thus a double addition. For the remaining amount, the Tribunal noted that approval for remuneration was obtained later but related back to the assessment year, and similar expenses were allowed in other years.

The Tribunal held that the reassessment proceedings were not challenged on specific grounds before it, and thus, the assessee's grounds related to the validity of reassessment were not adjudicated. Regarding additions made on the basis of material collected at the back of the assessee, the Tribunal noted that the CIT(Appeals) had deleted certain additions after considering remand reports and evidence, and these findings were not controverted. The Tribunal upheld the CIT(Appeals)'s deletion of additions amounting to Rs. 9,59,321/- (pertaining to campus school expenses) and Rs. 4,28,693/- (due to debiting under a wrong head), reasoning that actual expenditure incurred cannot be disallowed due to wrong posting. The Tribunal also upheld the deletion of addition of Rs. 1,40,64,916/- on account of payment to M/s Ansal House Construction, as the assessee provided supporting evidence and the expenditure was on capital account. The addition on account of investment in FDR (Rs. 1,35,19,70,96/-) was deleted by the CIT(Appeals), and this was upheld by the Tribunal, following its reasoning on a similar issue in assessee's appeal. The Tribunal upheld the CIT(Appeals)'s decision to allow depreciation on the building, as its existence and use were not in dispute. The Tribunal dismissed the Revenue's grounds concerning processing charges and expenditure not supported by bills, as the CIT(Appeals)'s findings were not controverted. The Tribunal partly allowed the assessee's appeal for statistical purposes and dismissed the Revenue's appeal.

The Tribunal held that the reassessment proceedings were not challenged on specific grounds before it, and thus, the assessee's grounds related to the validity of reassessment were not adjudicated. Regarding additions made on the basis of material collected at the back of the assessee, the Tribunal noted that the CIT(Appeals) had deleted certain additions after considering remand reports and evidence, and these findings were not controverted. The Tribunal upheld the CIT(Appeals)'s deletion of additions amounting to Rs. 9,59,321/- (pertaining to campus school expenses) and Rs. 4,28,693/- (due to debiting under a wrong head), reasoning that actual expenditure incurred cannot be disallowed due to wrong posting. The Tribunal also upheld the deletion of addition of Rs. 1,40,64,916/- on account of payment to M/s Ansal House Construction, as the assessee provided supporting evidence and the expenditure was on capital account. The addition on account of investment in FDR (Rs. 1,35,19,70,96/-) was deleted by the CIT(Appeals), and this was upheld by the Tribunal, following its reasoning on a similar issue in assessee's appeal. The Tribunal upheld the CIT(Appeals)'s decision to allow depreciation on the building, as its existence and use were not in dispute. The Tribunal dismissed the Revenue's grounds concerning processing charges and expenditure not supported by bills, as the CIT(Appeals)'s findings were not controverted. The Tribunal partly allowed the assessee's appeal for statistical purposes and dismissed the Revenue's appeal.

The Tribunal held that the reassessment proceedings were not challenged on specific grounds before it, and thus, the assessee's grounds related to the validity of reassessment were not adjudicated. Regarding additions made on the basis of material collected at the back of the assessee, the Tribunal noted that the CIT(Appeals) had deleted certain additions after considering remand reports and evidence, and these findings were not controverted. The Tribunal upheld the CIT(Appeals)'s deletion of additions amounting to Rs. 9,59,321/- (pertaining to campus school expenses) and Rs. 4,28,693/- (due to debiting under a wrong head), reasoning that actual expenditure incurred cannot be disallowed due to wrong posting. The Tribunal also upheld the deletion of addition of Rs. 1,40,64,916/- on account of payment to M/s Ansal House Construction, as the assessee provided supporting evidence and the expenditure was on capital account. The addition on account of investment in FDR (Rs. 1,35,19,70,96/-) was deleted by the CIT(Appeals), and this was upheld by the Tribunal, following its reasoning on a similar issue in assessee's appeal. The Tribunal upheld the CIT(Appeals)'s decision to allow depreciation on the building, as its existence and use were not in dispute. The Tribunal dismissed the Revenue's grounds concerning processing charges and expenditure not supported by bills, as the CIT(Appeals)'s findings were not controverted. The Tribunal partly allowed the assessee's appeal for statistical purposes and dismissed the Revenue's appeal.

The Tribunal held that the reassessment proceedings were not challenged on specific grounds before it, and thus, the assessee's grounds related to the validity of reassessment were not adjudicated. Regarding additions made on the basis of material collected at the back of the assessee, the Tribunal noted that the CIT(Appeals) had deleted certain additions after considering remand reports and evidence, and these findings were not controverted. The Tribunal upheld the CIT(Appeals)'s deletion of additions amounting to Rs. 9,59,321/- (pertaining to campus school expenses) and Rs. 4,28,693/- (due to debiting under a wrong head), reasoning that actual expenditure incurred cannot be disallowed due to wrong posting. The Tribunal also upheld the deletion of addition of Rs. 1,40,64,916/- on account of payment to M/s Ansal House Construction, as the assessee provided supporting evidence and the expenditure was on capital account. The addition on account of investment in FDR (Rs. 1,35,19,70,96/-) was deleted by the CIT(Appeals), and this was upheld by the Tribunal, following its reasoning on a similar issue in assessee's appeal. The Tribunal upheld the CIT(Appeals)'s decision to allow depreciation on the building, as its existence and use were not in dispute. The Tribunal dismissed the Revenue's grounds concerning processing charges and expenditure not supported by bills, as the CIT(Appeals)'s findings were not controverted. The Tribunal partly allowed the assessee's appeal for statistical purposes and dismissed the Revenue's appeal.

The Tribunal held that the reassessment proceedings were not challenged on specific grounds before it, and thus, the assessee's grounds related to the validity of reassessment were not adjudicated. Regarding additions made on the basis of material collected at the back of the assessee, the Tribunal noted that the CIT(Appeals) had deleted certain additions after considering remand reports and evidence, and these findings were not controverted. The Tribunal upheld the CIT(Appeals)'s deletion of additions amounting to Rs. 9,59,321/- (pertaining to campus school expenses) and Rs. 4,28,693/- (due to debiting under a wrong head), reasoning that actual expenditure incurred cannot be disallowed due to wrong posting. The Tribunal also upheld the deletion of addition of Rs. 1,40,64,916/- on account of payment to M/s Ansal House Construction, as the assessee provided supporting evidence and the expenditure was on capital account. The addition on account of investment in FDR (Rs. 1,35,19,70,96/-) was deleted by the CIT(Appeals), and this was upheld by the Tribunal, following its reasoning on a similar issue in assessee's appeal. The Tribunal upheld the CIT(Appeals)'s decision to allow depreciation on the building, as its existence and use were not in dispute. The Tribunal dismissed the Revenue's grounds concerning processing charges and expenditure not supported by bills, as the CIT(Appeals)'s findings were not controverted. The Tribunal partly allowed the assessee's appeal for statistical purposes and dismissed the Revenue's appeal.

The Tribunal held that since the assessee did not charge interest on overdue debts from third parties and was a debt-free company, no separate adjustment for interest on receivables was warranted. The higher margin earned by the assessee also indicated that the impact of delayed receivables was already factored in.

The Tribunal held that the reassessment proceedings were void as they were not based on tangible material. The addition in a subsequent year did not constitute tangible material for reopening, especially when the issue was accepted in a prior year.

The Tribunal held that the assessees had entered into genuine transactions of sale and purchase of shares, supported by documentary evidence. The Tribunal found that the SEBI's subsequent orders absolved the companies, and the material relied upon by the revenue was either not confronted or not specific to the assessees.

The Tribunal held that the assessees had entered into genuine transactions of sale and purchase of shares, supported by documentary evidence. The Tribunal found that the SEBI's subsequent orders absolved the companies, and the material relied upon by the revenue was either not confronted or not specific to the assessees.

The Tribunal held that the Revenue treated the LTCG as bogus based on suspicion and probability without finding any defect in the documentary evidence provided by the assessee. The Tribunal noted that the AO did not conduct independent inquiries and relied solely on a statement recorded behind the assessee's back without allowing cross-examination.

The Tribunal held that the Assessing Officer failed to conduct a proper investigation into the genuineness of the share premium transactions, especially in light of seized material suggesting accommodation entries. The assessment order was therefore considered erroneous and prejudicial to the interest of the revenue.

The Tribunal upheld the deletion of disallowances, finding that the issue regarding payments to M/s. Sino Credit and Leasing Ltd. was covered by previous decisions of coordinate benches. Similarly, the land development expenses were found to be genuine and properly examined in a prior assessment year.

The Tribunal held that a notice under Section 148 issued in the name of a deceased person long after their death is invalid unless served on the legal heir. Valid service of notice is a mandatory condition precedent for acquiring jurisdiction for reassessment proceedings.

The Tribunal held that the penalty notice was invalid as it did not specify the exact limb of Section 271(1)(c) under which the penalty was being levied. This was considered a violation of natural justice.

The Tribunal held that the penalty notice was invalid as it did not specify the exact limb of Section 271(1)(c) under which the penalty was being levied. This was considered a violation of natural justice.

The Tribunal held that the penalty notice was invalid as it did not specify the exact limb of Section 271(1)(c) under which the penalty was being levied. This was considered a violation of natural justice.

The Tribunal held that the penalty notice was invalid as it did not specify the exact limb of Section 271(1)(c) under which the penalty was being levied. This was considered a violation of natural justice.

The Tribunal held that the penalty notice was invalid as it did not specify the exact limb of Section 271(1)(c) under which the penalty was being levied. This was considered a violation of natural justice.

The Tribunal upheld the relief granted by the CIT(A) who applied the peak credit theory and allowed a portion of the income as business and agricultural income. The Tribunal found no justification for further relief to the assessee.

The Tribunal held that reopening a concluded assessment requires tangible material, not merely a review of existing records. Since the AO reopened the case based on the same material available during the original assessment, it was considered a change of opinion, and thus invalid.

The Tribunal upheld the relief granted by the CIT(A) who applied the peak credit theory and allowed a portion of the income as business and agricultural income. The Tribunal found no justification for further relief to the assessee.

The Tribunal upheld the relief granted by the CIT(A) who applied the peak credit theory and allowed a portion of the income as business and agricultural income. The Tribunal found no justification for further relief to the assessee.

The Tribunal held that the penalty notice issued under Section 274 read with Section 271(1)(c) was bad in law as it did not specify which limb of the section the penalty proceedings were initiated under. Following a Supreme Court decision and a coordinate bench ruling, the penalty was cancelled.

The Tribunal held that accepting an addition in assessment proceedings does not automatically lead to a penalty. The explanation offered by the assessee in penalty proceedings regarding cash withdrawals as the source of deposits was accepted.

The Tribunal held that the CIT(A) failed to provide an adequate opportunity of being heard to the assessee before passing the order. This procedural lapse vitiated the order.

The Tribunal held that the AO erred in making the addition without rejecting the assessee's books of accounts. The AO failed to point out any defects in the books and made the addition solely based on a comparison with other entities, without considering differences in business models, products, or geographical areas.

The Tribunal held that the CIT(A) correctly deleted the addition of Rs. 82.30 lacs as the assessee had substantiated payments to creditors through banking channels and recovered debts. However, the addition of Rs. 15.09 lacs was confirmed as the assessee failed to substantiate these payments.

The Tribunal admitted the additional grounds challenging jurisdiction as they went to the root of the matter. Since these grounds were not raised before the CIT(A), there was no factual discussion. Therefore, the matter was remanded back to the CIT(A) for a speaking order after providing the assessee an opportunity to be heard.

The Tribunal held that the assessee was not granted an effective and meaningful opportunity of being heard before the CIT(A) due to unavoidable circumstances. Therefore, the impugned order was set aside.

The Tribunal noted conflicting High Court decisions on the levy of late fees for returns processed before June 1, 2015. Following the principle of favoring the assessee in case of conflicting judgments, the Tribunal restored the issue to the CIT(A) to ascertain the processing date and provide an opportunity to be heard.

The Tribunal held that the addition was not justified as the assessee had provided invoices, made payments through banking channels, and two parties confirmed the sales. The statement of a key witness was retracted and not subjected to cross-examination.

The Tribunal found it just and fair to remand the issue back to the CIT(A) due to the peculiar facts and circumstances. The assessee's health problems prevented meaningful participation before the lower appellate authority.

The Tribunal found that the issue required re-adjudication by the Assessing Officer in light of the assessee's submissions regarding separate accounts and prior year's acceptance. The AO was directed to decide the issue afresh after providing an opportunity of being heard.

The Tribunal held that voluntary TP adjustments should be included in the computation of deduction under Section 10A. The issue of TP adjustment for notional interest on receivables was restored to the TPO for fresh adjudication.

The Tribunal upheld the decision of the CIT(A) in deleting the penalties. It was held that the transactions in question were adjustment entries to rectify earlier mistakes and did not constitute violations of Sections 269SS or 269T.

The Tribunal held that the PCIT wrongly invoked revisionary powers under Section 263. The AO's acceptance of the capital introduction based on the evidence provided was a possible view, not an unsustainable one. The PCIT's attempt to examine the 'source of source' of the partner's capital was not permissible.

The Tribunal upheld the decision of the CIT(A) in deleting the penalties. It was held that the transactions in question were adjustment entries to rectify earlier mistakes and did not constitute violations of Sections 269SS or 269T.