ITAT Delhi Judgments — July 2019

The Tribunal admitted the additional ground raised by the assessee as it involved a legal issue and all facts were on record. The Tribunal restored the issue of stock discrepancies to the Assessing Officer for verification of the assessee's claim regarding breakages.

The Tribunal held that the CIT(A) had correctly deleted the addition of Rs. 16.67 crores on account of unexplained stock as it amounted to double taxation. The Tribunal also found that the addition of Rs. 66 lakhs on account of sub-contractor payments was made on surmises and presumptions without proper verification.

The Tribunal held that both appeals by the assessee are without merit and dismissed them. The Tribunal noted that the assessee had not been granted registration under Section 12AA of the Income Tax Act, rendering it ineligible for any exemption under Section 11. The authorities below had found unexplained deposits in the assessee's bank accounts for both years, with no satisfactory explanation of their source. Furthermore, the Tribunal observed that the bank accounts were managed by professionals who induced office bearers to accept unexplained deposits and transfer them to other societies for a commission of 10%. This indicated that the assessee society had no income and was not conducting activities aligned with its stated objects, characterizing the situation as money laundering through a systematic arrangement. The assessee failed to explain the source of the funds and their subsequent transfer. Consequently, no interference was warranted in the orders of the authorities below, and both appeals were dismissed.

The Tribunal upheld the CIT(A)'s decision to treat the rental income as 'Income from House Property', following previous ITAT orders in the assessee's own case. Similarly, the disallowance under Section 14A was restricted and re-computed as per Rule 8D, also based on prior rulings.

The Tribunal held that both appeals by the assessee are without merit and dismissed them. The Tribunal noted that the assessee had not been granted registration under Section 12AA of the Income Tax Act, rendering it ineligible for any exemption under Section 11. The authorities below had found unexplained deposits in the assessee's bank accounts for both years, with no satisfactory explanation of their source. Furthermore, the Tribunal observed that the bank accounts were managed by professionals who induced office bearers to accept unexplained deposits and transfer them to other societies for a commission of 10%. This indicated that the assessee society had no income and was not conducting activities aligned with its stated objects, characterizing the situation as money laundering through a systematic arrangement. The assessee failed to explain the source of the funds and their subsequent transfer. Consequently, no interference was warranted in the orders of the authorities below, and both appeals were dismissed.

The Tribunal noted that the AO had not considered the assessee's reply dated 19/12/2016. Therefore, the AO was directed to decide the issue afresh after considering the reply and providing an opportunity to the assessee.

The Tribunal held that the basis for the addition made by the AO was the cancellation of the trust's registration. Since the ITAT had previously allowed the assessee's appeal against the cancellation of registration, the foundation for the addition no longer existed, and the addition deserved to be deleted.

The Tribunal, in the interest of justice, set aside the issue to the Assessing Officer for fresh adjudication. This was based on the assessee's undertaking to cooperate and provide necessary evidence.

The Tribunal found that the reasons recorded by the AO for initiating proceedings and the information received under RTI indicated that the assessee had filed a return of income. Considering the evidence, the Tribunal held that the issues required thorough adjudication at the AO's level. Therefore, the orders of the revenue authorities were set aside and remitted back to the AO for fresh adjudication.

The Tribunal held that the CIT(A) decided the issue against the assessee without providing a sufficient opportunity to be heard, which violates the principles of natural justice. Therefore, the matter was set aside to the CIT(A) for a fresh decision.

The Tribunal admitted the additional ground raised by the assessee as it involved a legal issue and all facts were on record. The Tribunal restored the issue of stock discrepancies to the Assessing Officer for verification of the assessee's claim regarding breakages.

The Tribunal held that Section 56(2)(vii)(c) does not apply to the allotment of bonus shares. Issuance of bonus shares is a capitalization of profits by the company and does not result in an increase in the shareholder's wealth or receipt of new property.

The Tribunal held that disallowance under Section 40(a)(ia) is not applicable in cases of short deduction of TDS, especially when the tax liability has been discharged by the payee. The issue was squarely covered by previous judgments.

The Tribunal held that the assessee had a reasonable cause for not deducting TDS on the discount given to distributors, as there were differing legal opinions and judicial pronouncements on the matter. Therefore, the penalty under Section 271C was not leviable.

The Tribunal held that the assessee had a reasonable cause for not deducting TDS on the discount given to distributors, as there were differing legal opinions and judicial pronouncements on the matter. Therefore, the penalty under Section 271C was not leviable.

The Tribunal held that the assessee had a reasonable cause for not deducting TDS on the discount given to distributors, as there were differing legal opinions and judicial pronouncements on the matter. Therefore, the penalty under Section 271C was not leviable.

The Tribunal dismissed the Revenue's appeal. This was based on a CBDT circular directing that appeals with a tax effect below Rs. 20 lakhs should not be filed or pressed.

The Tribunal upheld the CIT(A)'s order, finding no illegality or perversity. The Tribunal noted that the assessee had provided evidence of skilled personnel and the services rendered by the management company for its SEZ project.

The Tribunal held that the departmental appeal was not maintainable as the tax effect was less than the monetary limit prescribed by CBDT Circular No. 03/2018. The Ld. DR could not provide any exceptions to this circular.

The Tribunal held that since the quantum addition, which formed the basis for the penalty, was deleted by the ITAT, there was no justification for levying the penalty. The order of the CIT(A) cancelling the penalty was upheld.

The ITAT held that the CIT(A) should have decided the appeal on merits even in the absence of the assessee, following principles of natural justice. The order of the CIT(A) was set aside for violating these principles and Section 250(6) of the IT Act.

The Tribunal admitted the additional ground raised by the assessee as it involved a legal issue and all facts were on record. The Tribunal restored the issue of stock discrepancies to the Assessing Officer for verification of the assessee's claim regarding breakages.

The Tribunal held that the assessee's status as an AJP cannot be changed to AOP without providing an opportunity of being heard. Following the principle of consistency and previous ITAT orders, the Tribunal ruled that OISD is not involved in trade or business, and the proviso to section 2(15) is not applicable.

The Tribunal found that the CIT(A) had indeed decided the issues against the assessee without providing sufficient opportunity for a hearing. Therefore, the matter was set aside to the CIT(A) for a fresh decision.

The Tribunal held that the subject property was indeed a residential property and its transfer under the collaboration agreement qualified for exemption under Section 54. The assessee had lost rights to the old structure and received a share in the new construction, fulfilling the conditions for capital gains exemption.

The Tribunal held that the CIT(A) had correctly deleted the addition of Rs. 16.67 crores on account of unexplained stock as it amounted to double taxation. The Tribunal also found that the addition of Rs. 66 lakhs on account of sub-contractor payments was made on surmises and presumptions without proper verification.

The Tribunal upheld the additions sustained by the CIT(A) regarding mismatch in 26AS and bogus sundry creditors. The ground challenging the validity of the assessment due to an unsigned notice was dismissed as it was not raised before the CIT(A).

The Tribunal acknowledged a calculation mistake and referred the matter back to the Assessing Officer for re-computation. However, it dismissed the assessee's claim of coercion, finding no evidence to support it and upholding the surrendered income.

The Tribunal held that only the profit element embedded in the alleged bogus purchases is taxable, not the entire purchase price. Following precedent, the disallowance was restricted to 5% of the impugned purchase amount.

The Tribunal held that the Department should not file appeals where the tax effect does not exceed Rs. 20 lakhs, as per CBDT Circular No. 3/2018. The Revenue's appeal was therefore not maintainable.

The tribunal held that the CIT(A) should have decided the case on merits rather than confirming additions due to the assessee's absence. Therefore, the matter was remanded back to the CIT(A) for adjudication on merits.

The Tribunal held that as per CBDT Circular No. 3/2018, the Department shall not file appeals where the tax effect does not exceed Rs. 20 lakhs. The Revenue's appeal was therefore not maintainable.

The Tribunal restored the issue to the file of the CIT(A) with a direction to grant one more opportunity to the assessee to appear and cooperate. The appeal was allowed for statistical purposes.

The Tribunal found that the service of notices by affixture was not done in accordance with the prescribed procedure, violating principles of natural justice and the Code of Civil Procedure. Consequently, the assessment order was deemed bad in law.

The Tribunal held that disallowance solely on the basis of cash payments, without rejecting books or pointing out defects, is not justified. Considering past assessment orders and the lack of specific violations, the disallowance was deemed excessive.

The Tribunal acknowledged a calculation mistake and referred the matter back to the Assessing Officer for re-computation. However, it dismissed the assessee's claim of coercion, finding no evidence to support it and upholding the surrendered income.

The Tribunal held that the departmental appeal was not maintainable as the tax effect was below the monetary limit prescribed by CBDT Circular No. 03/2018. The Ld. DR could not provide any exceptions to this circular.

The Tribunal acknowledged a calculation mistake and referred the matter back to the Assessing Officer for re-computation. However, it dismissed the assessee's claim of coercion regarding the surrendered income, finding no evidence to support it.

The Tribunal acknowledged a calculation mistake and referred the matter back to the Assessing Officer for re-computation. However, it dismissed the assessee's claim of coercion, finding no evidence to support it and upholding the surrendered income.

The Tribunal upheld the order of the CIT(A), stating that since the quantum assessment and additions were deleted, the penalty imposed could not stand. The Revenue's appeal was dismissed.

The Tribunal acknowledged a calculation mistake and referred the matter back to the Assessing Officer for re-computation. However, it dismissed the assessee's claim of coercion, finding no evidence to support it and upholding the surrendered income.

The Tribunal held that the departmental appeal was not maintainable as the tax effect was below the prescribed monetary limit of Rs. 20 lacs. The Ld. DR could not provide any exceptions to this rule.

The Tribunal held that since the additions in the quantum appeal were deleted by the Tribunal in a previous order, the penalty levied based on those additions no longer stands. Consequently, the penalty was deleted.

The Tribunal restored the issue to the file of the CIT(A) to provide one final opportunity to the assessee to explain its case. The CIT(A) was directed to decide the issue on merits after hearing the assessee.

The ITAT held that the CIT(A) should not have dismissed the appeal without considering the merits of the case, even in the absence of the assessee's representation. The tribunal set aside the CIT(A)'s order and remanded the matter for fresh disposal.