ITAT Delhi Judgments — May 2022

The Tribunal noted that the Rs. 36,65,000/- loan transaction appeared to be reflected in Mr. Ritesh Gupta's HDFC Bank account, contrary to the CIT(A)'s finding. The Tribunal also admitted additional evidence for other sustained additions.

The Tribunal concurred with the CIT(A)'s decision, stating that the disallowance was made purely on an estimated basis without supporting material. The AO should have either rejected the books of accounts and proceeded under Section 144 or made the assessment based on available material under Section 143(3).

The Tribunal held that interest income earned on fixed deposits, even if made for business exigencies like securing entry tax, does not have a direct nexus with the profits and gains derived from manufacturing, and thus is not eligible for deduction under Section 80IC. The issue of Section 14A disallowance was restored for factual verification, and the Section 80G deduction was also restored for the assessee to furnish supporting evidence.

The Tribunal held that the date of the agreement for an identifiable property should be considered the date of acquisition for indexation purposes, not the date of the sale deed or full payment. The benefit of indexation should be applied from the financial year of the agreement.

The Tribunal dismissed the revenue's grounds of appeal. It found that the AO's remand reports confirmed the verification of sundry creditors, that Section 40A(2)(b) was not applicable to the advance payments, and that the property advance was correctly adjusted to the partner's capital account.

The Tribunal found merit in the assessee's argument that the relief granted by the CIT(A) should have been calculated on the gross disallowance amount, not the net amount after suo moto disallowance. Therefore, the AO was directed to grant relief on the gross disallowance.

The Tribunal held that the CIT(A)'s view that Section 40(a)(ia) and Section 92CA(3) operate simultaneously is incorrect. Taxing the same amount twice is against fundamental principles of taxation.

The Tribunal held that the credit entry was a mere journal entry and not an actual cash credit. Relying on various High Court and Tribunal judgments, it was decided that Section 68 is not attracted when there is no cash receipt.

The Tribunal, in the interest of justice, remanded the matter back to the Assessing Officer. The AO is to verify whether the assessee claimed the loss and set it off against profits before arriving at the declared business income.

The Tribunal held that the AO's disallowance was not based on material evidence to establish excessiveness or unreasonableness. The reasonableness of expenditure should be viewed from the businessman's perspective, and the fact that recipients offered the income for tax was not controverted.

The Tribunal held that the interest income earned on idle funds deposited in banks is attributable to the business of providing credit facilities and is eligible for deduction under Section 80P. The Tribunal followed its own earlier decisions in the assessee's case.

The Tribunal held that the assessee failed to provide material to controvert the AO's findings that the renovation expenses resulted in the creation of new assets and were therefore capital in nature. Consequently, the expenditure was not allowable as revenue expenditure.

The Tribunal held that the loss on sale of assets should be considered as an application of income, following CBDT Circular No. 5-P(LXX-6) and various judicial precedents. The Tribunal noted that the amendment to Section 11(6) of the Act, which would disallow such claims, was not applicable to the assessment year in question.

The Tribunal upheld the decision of the CIT(A) that Section 41(1) is not applicable as the assessee had not written off the liabilities and they continued to be shown in the balance sheet. The Revenue failed to establish that the liabilities had ceased to exist.

The Tribunal found merit in the assessee's contention that the unpaid service tax was not claimed as an expenditure. Therefore, the matter was remitted back to the AO to verify the assessee's claim of suo-moto disallowance in the subsequent year.

The Tribunal held that the PCIT erred in assuming jurisdiction under Section 263 as the assessment order was not erroneous or prejudicial to the revenue. The Assessing Officer could not have made additions on account of share application money when the reasons for reopening were different.

The Tribunal upheld the CIT(A)'s decision to reject the books of account and estimate profit at 2.5% of the turnover. The Tribunal found the CIT(A)'s confirmation of a part of the addition to be reasonable.

The Tribunal held that the applicability of Section 14A to Section 115JB is a debatable issue and cannot be rectified under Section 154. Furthermore, a Special Bench decision held that no disallowance under Section 14A can be made while computing book profit under Section 115JB.

The Tribunal held that interest income earned on fixed deposits, even if made for business exigencies like securing entry tax, does not have a direct nexus with the profits and gains derived from manufacturing, and thus is not eligible for deduction under Section 80IC. The issue of Section 14A disallowance was restored for factual verification, and the Section 80G deduction was also restored for the assessee to furnish supporting evidence.

The Tribunal directed the exclusion of Wipro Ltd. from the list of comparables for software development services due to significant differences in operations and IP ownership. It also remanded the issue of adjusting unabsorbed depreciation against income from other sources to the AO for verification and allowance as per law.

The Tribunal held that the CIT(A)'s view that Section 40(a)(ia) and Section 92CA(3) operate simultaneously is incorrect. Taxing the same amount twice is against fundamental principles of taxation.

The Tribunal found that the AO indeed did not make any enquiry regarding the interest-free advances. Therefore, the assessment order was considered erroneous and prejudicial to the revenue's interest.

The Tribunal upheld the CIT(A)'s decision to allow the deduction. It noted that the Assessing Officer, during remand proceedings, verified the completion certificates on a test-check basis and found them to be in order.

The Tribunal noted that as per Section 4(2) of the Vivad Se Vishwas Act, 2020, an appeal pending before the Tribunal is deemed to have been withdrawn upon the issuance of a certificate by the designated authority. Therefore, the appeal was dismissed.

The Tribunal held that the Rs. 20,00,000 paid by cheque was verifiable and part of the books of account, thus not an unexplained expenditure. However, the source of Rs. 55,00,000 remained unexplained.

The Tribunal found that the lower authorities did not adequately examine the back-to-back invoices provided by the assessee. It held that any disallowance, if warranted, should be restricted to the depreciation on the markup charged by EREN France, not the entire purchase amount. The case was remanded to the AO for further inquiry.

The CIT(A) rightly rejected the additional evidence as the fire claim was unsubstantiated and not raised during assessment. The tribunal upheld the CIT(A)'s decision due to the assessee's non-compliance and lack of new material.

The Tribunal held that the assessee is not obligated to prove the source of the creditor's funds once the creditor's identity is established. The tax authorities' attempt to trace the transactions of the creditor was unjustified without conclusive evidence that the assessee received its own unaccounted money.

The Tribunal held that the AO erred in rejecting the valuation report without discrediting it on facts, especially considering the joint venture agreement which explained the difference in share prices. The CIT(A)'s decision to uphold the valuation was found to be correct.

The Tribunal held that a statement recorded under Section 132(4) alone cannot be considered incriminating material for making additions under Section 153A unless corroborated by other evidence found during the search. The CIT(A)'s order was upheld.

The Tribunal held that TDS under Section 194J is not deductible on roaming charges paid to other telecom service providers. Regarding interest under Section 201(1A), it directed re-computation of interest up to the date of payment by the deductee, following Supreme Court and CBDT instructions.

The Tribunal held that the CIT(A) failed to adjudicate the appeal on merits, violating principles of natural justice. The order of the CIT(A) was set aside, and the matter was restored for fresh adjudication on merits.

The Tribunal held that the non-claim of a statutory deduction, when the income is disclosed and the deduction is clearly allowable based on the record, constitutes a mistake apparent from the record. The AO is obligated to assess the true income, and the assessee is entitled to the deduction.

The Tribunal held that if the employees' contribution to PF and ESI is paid before the due date of filing the return of income under section 139(1), it is an allowable deduction. Therefore, the disallowance made by the revenue was deleted.

The Tribunal held that TDS under Section 194J is not deductible on roaming charges paid to other telecom service providers. Regarding interest under Section 201(1A), it directed re-computation of interest up to the date of payment by the deductee, following Supreme Court and CBDT instructions.

The Tribunal held that the CIT(A)'s view that Section 40(a)(ia) and Section 92CA(3) operate simultaneously is incorrect. Taxing the same amount twice is against fundamental principles of taxation.

The Tribunal held that for an NBFC engaged in investment activities, interest on borrowed funds used for investments is deductible as a business expense under Section 36(1)(iii). The nature of the assessee's business justifies such deductions.

The Tribunal held that TDS under Section 194J is not deductible on roaming charges paid to other telecom service providers. Regarding interest under Section 201(1A), it directed re-computation of interest up to the date of payment by the deductee, following Supreme Court and CBDT instructions.

The Tribunal held that TDS under Section 194J is not deductible on roaming charges paid to other telecom service providers. Regarding interest under Section 201(1A), it directed re-computation of interest up to the date of payment by the deductee, following Supreme Court and CBDT instructions.

The Tribunal held that the CIT(A) failed to adjudicate the appeal on merits, violating principles of natural justice. The order of the CIT(A) was set aside, and the matter was restored for fresh adjudication on merits.

The Tribunal held that 'penalty' imposed for violation of law is not an admissible expenditure under Section 37(1) of the Income Tax Act. However, it distinguished between 'fine' paid for redemption of goods and 'penalty' as punishment for illegal acts.

The Tribunal held that appellate authorities can entertain claims not made in the original return. It also found that the DTAA provisions do not differentiate between tax paid under normal provisions or Section 115JB, entitling the assessee to relief. The Tribunal also upheld the deletion of additions made under Section 2(22)(e) as the assessee was not a shareholder of the lending company.

The Tribunal held that reassessment proceedings are null and void in the absence of proper service of notice under Section 148 of the Act. The Tribunal upheld the CIT(A)'s decision to quash the assessment.

The Tribunal directed the Assessing Officer to verify the assessee's claim and compute the disallowance under Rule 8D(2)(iii) by considering only those investments that actually yielded exempt income during the year, excluding those yielding taxable or no income.

The Tribunal held that the assessee was not provided a fair opportunity of hearing before the additions were made. The matter was restored to the Commissioner (Appeals) for de novo adjudication.

The Tribunal directed the Assessing Officer to verify the claim of brought forward business loss and allow it if crystallized in the prior year. The disallowance of Employees' Contribution towards PF and ESI was also directed to be allowed as the payments were made before the due date of filing the return.

The Tribunal set aside the CIT(A)'s impugned order and restored the issues to the Assessing Officer for fresh adjudication. The Assessing Officer was directed to consider earlier orders and provide the assessee with a reasonable opportunity to be heard.

The Tribunal followed its previous decision in the case of co-owners, holding that the land sold was agricultural land and not subject to capital gains tax. Therefore, the addition made by the Assessing Officer was deleted.

The Tribunal set aside the CIT(A)'s impugned order and restored the issues to the Assessing Officer for fresh adjudication. The Assessing Officer was directed to consider earlier orders and provide the assessee with a reasonable opportunity to be heard.

The Tribunal set aside the CIT(A)'s impugned order and restored the issues to the Assessing Officer for fresh adjudication. The Assessing Officer was directed to consider earlier orders and provide the assessee with a reasonable opportunity to be heard.