ITAT Delhi Judgments — October 2021

The Tribunal held that delayed deposits of PF/ESIC contributions, if made before the filing of the return of income, are allowable as expenditure. The amendment brought by the Finance Act 2021 was deemed not applicable to the assessment year under consideration.

The Tribunal held that credits received against engine purchases were capital in nature, aligning with a Special Bench decision. Consequently, lease rental payments amortized against these credits were also considered capital expenditure and not disallowable. The issue of supplementary lease rent disallowance was also decided in favor of the assessee based on the Special Bench ruling.

The Tribunal found merit in the assessee's arguments that the son should be examined for the Rs. 5,75,000/- addition and that capital gains on property owned by the wife should not be taxed in the assessee's hands. Both issues were restored to the AO for fresh adjudication.

The Tribunal held that no disallowance under Section 36(1)(va) is warranted when the employee contributions are deposited before filing the return of income. The amendment by the Finance Act 2021 was held to be prospective and not applicable to the assessment year in question.

The Tribunal followed a coordinate bench decision which, after considering various High Court judgments including the one relied upon by the CIT(A), held that no disallowance under Section 36(1)(va) is warranted if the employee's contributions are deposited before the filing of the return of income. Therefore, the disallowance was directed to be deleted.

The Tribunal held that credits received against engine purchases were capital in nature, aligning with a Special Bench decision. Consequently, lease rental payments amortized against these credits were also considered capital expenditure and not disallowable. The issue of supplementary lease rent disallowance was also decided in favor of the assessee based on the Special Bench ruling.

The Tribunal held that the second reassessment proceedings were not in accordance with the law as the AO could not reopen the assessment on the same set of facts without tangible material. The reassessment proceedings were quashed.

The Tribunal held that credits received against engine purchases were capital in nature, aligning with a Special Bench decision. Consequently, lease rental payments amortized against these credits were also considered capital expenditure and not disallowable. The issue of supplementary lease rent disallowance was also decided in favor of the assessee based on the Special Bench ruling.

The Tribunal held that the assessee's method of accounting (project completion method) was consistently followed and accepted in prior years, and the AO failed to invoke Section 144 to reject it. It also held that brokerage expenses are allowable as selling expenses and that the interest paid was for late payment of land installments, not for interest-bearing funds used for advances.

The Tribunal held that if expenses are incurred wholly and exclusively for business purposes, they should be allowed in the year of incurrence, regardless of the accounting year. The disallowance was therefore unjustified.

The Tribunal held that Section 50C of the Income Tax Act does not apply to charitable trusts whose income is computed under Section 11(1A). The net consideration for capital gains under Section 11(1A) is not required to be substituted by the fair market value.

The Tribunal held that credits received against engine purchases were capital in nature, aligning with a Special Bench decision. Consequently, lease rental payments amortized against these credits were also considered capital expenditure and not disallowable. The issue of supplementary lease rent disallowance was also decided in favor of the assessee based on the Special Bench ruling.

The Tribunal held that the Assessing Officer failed to provide reasoning for adopting 10% of gross receipts as profit, thus not satisfying the requirements of Section 144. The addition made by the AO was set aside.

The Tribunal held that the Assessing Officer failed to provide reasoning for adopting 10% of gross receipts as profit, thus not satisfying the requirements of Section 144. The addition made by the AO was set aside.

The Tribunal quashed the reassessment proceedings. It found that the reasons for reopening were recorded based on an assessment order for AY 2011-12 which was passed after the reasons were recorded, rendering the reopening invalid.

The Tribunal held that credits received against engine purchases were capital in nature, aligning with a Special Bench decision. Consequently, lease rental payments amortized against these credits were also considered capital expenditure and not disallowable. The issue of supplementary lease rent disallowance was also decided in favor of the assessee based on the Special Bench ruling.

The Tribunal quashed the reassessment proceedings. It found that the reasons for reopening were recorded based on an assessment order for AY 2011-12 which was passed after the reasons were recorded, rendering the reopening invalid.

The Tribunal held that foreign exchange fluctuations are an integral part of international transactions and thus an operating item. It also ruled that interest on receivables should not be benchmarked when not charged by either party and that Education Cess is allowable as a deduction under Section 37.

The Tribunal quashed the reassessment proceedings. It found that the reasons for reopening were recorded based on an assessment order for AY 2011-12 which was passed after the reasons were recorded, rendering the reopening invalid.

The Tribunal followed a coordinate bench decision which, after considering various High Court judgments including the one relied upon by the CIT(A), held that no disallowance under Section 36(1)(va) is warranted if the employee's contributions are deposited before the filing of the return of income. Therefore, the disallowance was directed to be deleted.

The Tribunal noted that a coordinate bench had previously remitted an identical issue for an earlier assessment year back to the AO for fresh adjudication. Following the principle of consistency, the Tribunal also remitted the current issue to the AO for fresh decision.

The Tribunal considered the assessee's request to withdraw the appeal. The Departmental Representative raised no objection to the withdrawal.

The Tribunal allowed the deduction of education cess under Section 37(1) of the Income Tax Act, following the precedents set by the Bombay and Rajasthan High Courts. The appeal was partly allowed.

The Tribunal held that the CIT(A) was correct in allowing the deduction under Section 80IA, following the Delhi High Court's decision. It also upheld the deletion of disallowance under Section 14A as no exempt income was earned, and confirmed the treatment of interest on FDRs as business income due to its direct nexus with securing business contracts.

The Tribunal held that the assessee should be given another opportunity to prove the identity, creditworthiness, and genuineness of the loan transaction with Daljit Singh. The AO was directed to re-examine the issue after the assessee provides cogent evidence.

The Tribunal dismissed the assessee's appeal as withdrawn, subject to the condition that if the dispute is not resolved under the VSV scheme, the assessee can seek reinstitution of the appeal.

The Tribunal accepted the assessee's request for withdrawal of the appeal. The appeal was dismissed as withdrawn based on the settlement under the Vivad Se Vishwas Scheme.

The Tribunal held that the CIT(A) was correct in allowing the deduction under Section 80IA, following the Delhi High Court's decision. It also upheld the deletion of disallowance under Section 14A as no exempt income was earned, and confirmed the treatment of interest on FDRs as business income due to its direct nexus with securing business contracts.

The Tribunal agreed with the assessee's request to restore the issues back to the AO for fresh consideration. Both parties consented to this approach, and the Tribunal clarified it was not opining on the merits of the case.

The Tribunal agreed with the assessee's submission that the AO failed to provide a reasonable opportunity of being heard. Both parties consented to restoring the issues back to the AO for fresh adjudication.

The assessee requested withdrawal of the appeal as they had opted to settle the tax arrears under the Vivad Se Vishwas Scheme, 2020. The tribunal allowed the withdrawal request.

The Tribunal held that the assessee had no business connection or Permanent Establishment (PE) in India for the supply of GSM systems. It also held that software payments were business income and not royalty, following Supreme Court judgments.

The Tribunal held that the assessee had no business connection or Permanent Establishment (PE) in India for the supply of GSM systems. It also held that software payments were business income and not royalty, following Supreme Court judgments.

The assessee requested withdrawal of the appeal as they had opted to settle the tax arrears under the Vivad Se Vishwas Scheme. The tribunal allowed the withdrawal request.

The Tribunal held that the assessee had no business connection or Permanent Establishment (PE) in India for the supply of GSM systems. It also held that software payments were business income and not royalty, following Supreme Court judgments.

The Tribunal agreed with the assessee's representative and the Revenue's no-objection to restore the issues back to the AO. The AO was directed to pass fresh orders after providing a reasonable opportunity of being heard to the assessee.

The Tribunal accepted the assessee's request for withdrawal of the appeals. The appeals were dismissed as withdrawn based on the settlement under the Vivad Se Vishwas Scheme.

The Tribunal held that the assessee had no business connection or Permanent Establishment (PE) in India for the supply of GSM systems. It also held that software payments were business income and not royalty, following Supreme Court judgments.

The Tribunal held that the assessee had no business connection or Permanent Establishment (PE) in India for the supply of GSM systems. It also held that software payments were business income and not royalty, following Supreme Court judgments.

The Tribunal held that the assessee had no business connection or Permanent Establishment (PE) in India for the supply of GSM systems. It also held that software payments were business income and not royalty, following Supreme Court judgments.

The Tribunal accepted the Revenue's request to withdraw the appeal, as the assessee had opted for and deposited the amount under the Vivad Se Vishwas Scheme. The appeal was dismissed with liberty to the Revenue to seek revival if the scheme resolution fails.

The Tribunal dismissed the Revenue's appeal, subject to the condition that if the dispute is not resolved under the Vivad se Vishwas Act, the assessee can seek reinstitution of the appeal.

The Tribunal accepted the assessee's request for withdrawal of the appeal. The appeal was dismissed as withdrawn based on the assessee's settlement under the Vivad Se Vishwas Scheme.

The Tribunal agreed with the assessee's representative that the cases should be restored to the AO for fresh consideration. Both parties consented to this course of action.

The Tribunal accepted the assessee's request for withdrawal of the appeals. The appeals were dismissed as withdrawn based on the settlement under the Vivad Se Vishwas Scheme.

The Tribunal agreed with the assessee's request to restore the issues back to the AO for fresh consideration. Both parties consented to this approach, and the Tribunal clarified it was not opining on the merits of the case.

The Tribunal held that the assessee had no business connection or Permanent Establishment (PE) in India for the supply of GSM systems. It also held that software payments were business income and not royalty, following Supreme Court judgments.

The Tribunal held that the assessee had no business connection or Permanent Establishment (PE) in India for the supply of GSM systems. It also held that software payments were business income and not royalty, following Supreme Court judgments.

The Tribunal agreed with the assessee's request to restore the issues back to the AO for fresh consideration. Both parties consented to this approach, and the Tribunal clarified it was not opining on the merits of the case.

The Tribunal accepted the assessee's request for withdrawal of the appeals. This was based on the assessee opting to settle the tax arrears under the Vivad Se Vishwas Scheme, 2020.