ITAT Delhi Judgments — November 2019

The Tribunal held that assessments framed on a non-existing entity are a nullity in law, following the judgments of the Delhi High Court and the Supreme Court. Therefore, the assessments were quashed.

The Tribunal held that the assessee failed to dispel the suspicion surrounding the share transactions, which were found to be sham and entered into for tax evasion. The authorities below had cogent reasons for their conclusions.

The Tribunal held that assessments framed on a non-existing entity are a nullity in law, following the precedent set by the Delhi High Court and affirmed by the Supreme Court. Therefore, the assessments were quashed.

The Tribunal noted that CBDT Circular No. 17/2019 enhanced the monetary limit for filing appeals to the Tribunal to Rs. 50 lakhs and applies to pending appeals. Therefore, the Revenue's appeal was dismissed as non-maintainable.

The Tribunal held that the appeal was not maintainable due to the low tax effect, as per the CBDT circulars. The Revenue was permitted to approach the Tribunal for re-institution if exceptions applied.

The Tribunal restored the appeal to the CIT(A) for adjudication on merits, noting that while the assessee's conduct was deprecated, the CIT(A) should have decided the appeal on merits. The stay application was dismissed as infructuous.

The Tribunal held that assessments framed on a non-existing entity are a nullity in law, following the precedent set by the Delhi High Court and affirmed by the Supreme Court. Therefore, the assessments were quashed.

The Tribunal held that assessments framed on a non-existing entity are a nullity in law, following the precedent set by the Delhi High Court and affirmed by the Supreme Court. Therefore, the assessments were quashed.

The Tribunal held that since no incriminating material was found during the search and no assessment proceedings were pending, the Assessing Officer lacked jurisdiction to make additions under Section 153A. The additions were therefore deleted.

The Tribunal restored the appeal to the file of the CIT(Appeals) for adjudication on merits. The CIT(Appeals) was directed to provide an opportunity of hearing to the assessee.

The Tribunal held that the assessee had made a full and true disclosure of all material facts regarding the transfer of assets during the original assessment. Therefore, the notice issued under Section 148 beyond the four-year period was bad in law.

The Tribunal held that mere confirmations from parties are insufficient to discharge the onus under Section 68, especially when investigations indicate the lenders are accommodation entry providers. The CIT(A) erred in deleting the additions made by the AO.

The Tribunal held that mere confirmations from parties are insufficient to discharge the onus under Section 68, especially when investigations indicate the lenders are accommodation entry providers. The CIT(A) erred in deleting the additions made by the AO.

The Tribunal held that the appeal of the Revenue deserved to be dismissed due to low tax effect, as per the CBDT circular and its subsequent clarification. The circular was binding on the tax authorities and applied retrospectively to pending appeals.

The Tribunal dismissed the appeal filed by the Revenue. This was based on a CBDT circular that enhanced the monetary limit for filing appeals before the Tribunal, and the tax effect in this case was below the prescribed limit.

The Tribunal held that mere confirmations from parties are insufficient to discharge the onus under Section 68, especially when investigations indicate the lenders are accommodation entry providers. The CIT(A) erred in deleting the additions made by the AO.

The Tribunal held that the AO and CIT(A) failed to provide evidence that the withdrawn cash was spent on other purposes. Merely a time gap between withdrawal and deposit is not sufficient to reject the assessee's explanation.

The Tribunal held that rebate under Section 88E is allowable even when calculating MAT under Section 115JB, following a Karnataka High Court decision. Regarding Section 14A, the disallowance was directed to be re-examined, considering only investments yielding exempt income.

The Tribunal held that the reassessment proceedings were invalid as the AO's reasons for reopening were not sufficient to form a belief that income had escaped assessment. The notice for reopening was considered to be for a fishing inquiry, which is not permissible.

The Tribunal held that provision for post-retirement medical expenses, based on actuarial valuation, is a definite liability and allowable. Regarding interest income from cooperative societies, the Tribunal directed verification of taxability in the hands of the societies and dismissed the revenue's grounds related to this.

The Tribunal held that rebate under Section 88E is allowable even when calculating MAT under Section 115JB, following a Karnataka High Court decision. Regarding Section 14A, the disallowance was directed to be re-examined, considering only investments yielding exempt income.

The Tribunal upheld the deletion of disallowance on commission paid to directors, finding it was based on prior rulings and supported by facts. However, the disallowance under Section 14A was remanded for fresh adjudication due to the complexity of investments. The disallowance for non-deduction of TDS was dismissed, agreeing with the CIT(A) that no TDS was required.

The Tribunal held that the CIT(A) decided the issue without hearing the assessee and without granting sufficient opportunity. Therefore, the matter was set aside to the CIT(A) for fresh adjudication.

The Tribunal held that the assessee failed to discharge its onus to prove the identity, genuineness, and creditworthiness of the shareholders from whom share application money was received. The AO's addition under Section 68 was therefore sustained.

The Tribunal held that no disallowance was called for under Section 40(a)(i) as the assessee was entitled to the benefit of the DTAA. It also upheld the deletion of disallowance under Section 14A as no dividend income was earned by the taxpayer during the year.

The Tribunal found that the assessee was prevented by sufficient cause from appearing before the CIT(A). Therefore, the order of the CIT(A) was set aside, and the appeal was restored to the CIT(A) for a fresh decision on merits.

The Tribunal upheld the DRP's decision to exclude the comparable companies, finding them to be functionally dissimilar or failing the filters set by the TPO. Therefore, the Revenue's appeal was dismissed.

The Tribunal held that the appeal filed by the Revenue was not maintainable as the tax effect was below the monetary limit prescribed by CBDT Circular No. 17/2019. Therefore, the appeal was dismissed.

The Tribunal held that once the source of credit card payments was established, no disallowance should be made. Regarding house property income, the Tribunal found a violation of natural justice as the AO's inquiries were not shared with the assessee.

The Tribunal held that the assessee had made a full and true disclosure of all material facts regarding the transfer of assets during the original assessment. Therefore, the notice issued under Section 148 beyond the four-year period was bad in law.

The Tribunal held that the appeal was not maintainable as the tax effect was below the enhanced monetary limit of Rs. 50 lakhs as per the CBDT circular. This circular was applicable to pending appeals.

The Tribunal held that the assessee had made a full and true disclosure of all material facts regarding the transfer of assets during the original assessment. Therefore, the notice issued under Section 148 beyond the four-year period was bad in law.

The Tribunal held that the assessee failed to discharge its onus to prove the identity, genuineness, and creditworthiness of the shareholders from whom share application money was received. The AO's addition under Section 68 was therefore sustained.

The Tribunal held that the appeals were not maintainable as the tax effect was below the enhanced monetary limit of Rs. 50 lakhs specified in CBDT Circular No. 17/2019. This circular was held to be applicable to pending appeals.

The Tribunal held that the CIT(A) erred by not considering the additional evidence filed by the assessee and by not properly verifying the net profit rate. Therefore, the issue was remanded back to the CIT(A) for fresh verification and determination.

The Tribunal upheld the CIT(A)'s decision to sustain a part of the addition related to interest on PDCs, finding that the modus operandi of paying interest on extended PDCs was established from seized material in group cases. The Tribunal followed a coordinate bench decision on similar facts.

The Tribunal held that the CIT(A) erred by not considering the additional evidence filed by the assessee and by not properly verifying the net profit rate. Therefore, the issue was remanded back to the CIT(A) for fresh verification and determination.

The Tribunal held that the appeals were not maintainable as the tax effect was below the enhanced monetary limit of Rs. 50 lakhs specified in CBDT Circular No. 17/2019. This circular was held to be applicable to pending appeals.

The Tribunal held that since the additions made by the Assessing Officer were deleted by a co-ordinate bench in the assessee's own case due to absence of incriminating material found during search, the penalty levied under Section 271(1)(c) has no basis and must be deleted.

The Tribunal directed the AO to re-examine the bad debts claim in light of Section 36(2) and to adopt a consistent approach for transfer pricing issues across assessment years. Depreciation at 60% was allowed based on High Court precedent.

The Tribunal held that the reassessment proceedings were initiated without proper application of mind and on vague reasons, similar to a previous year's case. The additions under Sections 68 and 69 were also found to be unjustified, with the investment addition being a potential double addition and the cash deposit addition not properly considered.

The Tribunal directed the AO to re-examine the bad debts claim in light of Section 36(2) and to adopt a consistent approach for transfer pricing issues across assessment years. Depreciation at 60% was allowed based on High Court precedent.

The Tribunal directed the AO to re-examine the bad debts claim in light of Section 36(2) and to adopt a consistent approach for transfer pricing issues across assessment years. Depreciation at 60% was allowed based on High Court precedent.

The Tribunal admitted the additional ground on interest, remanding it to the AO for verification of TDS applicability. For the disallowances under section 40(a)(ia), the Tribunal held that the amendment restricting disallowance to 30% is curative and retrospective, directing the AO to restrict the disallowance accordingly.

The Tribunal held that the reopening of assessment was based on borrowed satisfaction and lacked tangible material or independent application of mind by the AO. The approval for reopening was also found to be mechanical.

The Tribunal restored the issue to the CIT(A) to provide the assessee with one more opportunity to substantiate its case, considering the interest of justice.

The Tribunal held that the reassessment proceedings were invalid because the approving authority (JCIT) did not apply their mind properly. Furthermore, the addition made was on a different ground than the one used for reopening, which is not permissible.

The Tribunal held that the discrepancies were due to bonafide mistakes by the Chartered Accountant handling the accounts and return filing. The professional fees were reflected as advances and offered to tax in the subsequent year, and interest was shown net of TDS. Therefore, there was no deliberate concealment or furnishing of inaccurate particulars.

The ITAT restored the issue to the file of the CIT(A) to provide one final opportunity to the assessee to present its case. The assessee was directed to appear without adjournment.

The Tribunal held that Excel Infoways Ltd., TCS E-serve Ltd., and Infosys BPO Ltd. were not suitable comparables for benchmarking the ITES transactions. This was due to dissimilar functions, brand value, risk profiles, and lack of segmental data for some comparables.