ITAT Delhi Judgments — June 2022

The Tribunal held that the Assessing Officer did not record satisfaction for initiating penalty proceedings and that the assessee had appeared through an authorized representative and made partial compliance. Since the assessment was completed under section 143(3) and not 144, the penalty was not sustainable.

The Tribunal, without delving into the merits of the case, dismissed the appeal as withdrawn based on the assessee's application.

The Tribunal admitted the additional ground regarding the Focus License, but ultimately affirmed the CIT(A)'s order, treating the incentive as revenue receipt. The Tribunal also held that interest earned on fixed deposits made from surplus funds, not connected to manufacturing activity, is not eligible for deduction.

The Tribunal held that the CIT(A) failed to decide the jurisdictional issue raised by the assessee. Therefore, the matter was restored to the CIT(A) for a fresh adjudication after providing an opportunity to both parties.

The Tribunal held that the Revenue has the initial burden to prove an arrangement for inflating profits, and mere high profits or close connection are insufficient. It also held that interest income earned on deposits from export proceeds should be included in eligible profits for Section 10AA deduction.

The Tribunal held that Section 14A cannot be invoked if no exempt income is earned. It also confirmed that income from carbon credit sales is a capital receipt and not taxable, aligning with previous decisions in the assessee's own case.

The Tribunal upheld the deletion of the addition by the CIT(A). It noted that similar disallowances for earlier assessment years had been deleted by the CIT(A) and upheld by the ITAT in the assessee's own case.

The Tribunal held that the right of the resident country to tax its residents cannot be taken away by a DTAA in the absence of an express provision. The phrase "may be taxed" in the DTAA cannot be construed as "shall be taxable only in the resident state" unless explicitly stated. Therefore, Section 90(1)(a)(i) of the Income Tax Act was applicable.

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noted that as per Section 4(2) of the Vivad Se Vishwas Act, 2020, an appeal pending before the Tribunal is deemed withdrawn upon issuance of a certificate by the designated authority.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

The Tribunal granted permission for the withdrawal of the appeal. The appeal was dismissed as withdrawn by the assessee.

The Tribunal held that Section 14A cannot be invoked if no exempt income is earned. It also confirmed that income from carbon credit sales is a capital receipt and not taxable, aligning with previous decisions in the assessee's own case.

The Tribunal held that the amounts deposited in bank accounts were likely from agricultural activities, and the foreign currency deposit receipt did not establish undisclosed income of the assessee. The expense details were considered practice entries on accounting software.

The Tribunal held that the assessee was entitled to claim depreciation on the revalued assets as the parent company had offered capital gains on the slump sale, making Section 49(3) applicable. The Tribunal also upheld the deletion of disallowances for management consultancy fees, pre-operative expenses, and loan-related expenses, finding no sufficient evidence to support the AO's claims.

The Tribunal held that Section 14A cannot be invoked if no exempt income is earned. It also confirmed that income from carbon credit sales is a capital receipt and not taxable, aligning with previous decisions in the assessee's own case.

The Tribunal admitted additional evidence regarding the lender's creditworthiness and restored the issue to the Assessing Officer for fresh adjudication. The Assessing Officer is directed to consider all evidence, including the additional documents, and provide a reasonable opportunity of being heard to the assessee.

The Tribunal held that the entire consideration for the property was financed by the HUF's funds, and the inclusion of other members' names in the sale deed was cosmetic. Therefore, the full exemption under Section 54F should be allowed.

The Tribunal held that the second proviso to Section 40(a)(ia) is applicable, deeming tax paid on the date of the payee's return filing. Since this date was after the due date for filing the return, the assessee could not claim the deduction in the current assessment year.

The Tribunal held that the assessee, being part of the searched group, had the onus to prove the validity of share capital. The CIT(A) erred in presuming innocence and not giving due weight to the AO's findings based on seized documents.

The Tribunal held that the amounts deposited in bank accounts were likely from agricultural activities, and the foreign currency deposit receipt did not establish undisclosed income of the assessee. The expense details were considered practice entries on accounting software.

The Tribunal held that the assessee committed the default for the first time and acted under a bona fide belief without dishonest intention. Therefore, the penalty imposed under Section 271B was deleted.

The Tribunal noted that the assessee had availed the Vivad se Vishwas scheme and the department had issued the relevant form. Therefore, the appeal was dismissed as withdrawn.

The Tribunal held that a surplus generated by an educational institution does not automatically imply it is run for profit, especially when used for upgrading facilities. The CIT(Exemptions) failed to apply the tests laid down by the Apex Court to determine if the institution existed solely for educational purposes.

The Tribunal upheld the CIT(A)'s decision to restrict the Section 14A disallowance, delete the addition on income from other sources, and delete the disallowances for director's remuneration and lead charges. The Tribunal found the CIT(A)'s reasoning to be sound and supported by relevant case law.

The Tribunal held that the additional grounds of appeal regarding the invalidity of Section 148 notices were not purely legal and required factual investigation, thus dismissing them. However, acknowledging the potential issue with the notice address and the assessee's lack of opportunity, the Tribunal set aside the assessment and penalty orders to the Assessing Officer for fresh adjudication.

The Tribunal held that the cash deposits of Rs. 10,00,000/- were not corroborated and thus affirmed the addition under Section 68. However, it directed the revenue to estimate profits at 8% instead of the 15% estimated by the CIT(A).

The Tribunal held that the CIT(A) was justified in deleting the additions as no incriminating material was found during the search to support the additions for the assessment years in question. The Tribunal also noted that the assessment for AY 2010-11 had already attained finality.

The Tribunal held that the CIT(A) was justified in deleting the additions as no incriminating material was found during the search to support the additions for the assessment years in question. The Tribunal also noted that the assessment for AY 2010-11 had already attained finality.

The Tribunal held that the additional grounds of appeal regarding the invalidity of Section 148 notices were not purely legal and required factual investigation, thus dismissing them. However, acknowledging the potential issue with the notice address and the assessee's lack of opportunity, the Tribunal set aside the assessment and penalty orders to the Assessing Officer for fresh adjudication.

The Tribunal held that the addition of Rs. 11,01,317/- should be reconsidered by the CIT(A) allowing the assessee an opportunity to establish payments made to certain builders. The addition of Rs. 16,82,836/- was set aside due to violation of natural justice, and the matter was restored to the CIT(A). The 10% disallowance of expenses was deleted.

The Tribunal held that Section 14A cannot be invoked if no exempt income is earned. It also confirmed that income from carbon credit sales is a capital receipt and not taxable, aligning with previous decisions in the assessee's own case.

The Tribunal held that Section 14A cannot be invoked if no exempt income is earned. It also confirmed that income from carbon credit sales is a capital receipt and not taxable, aligning with previous decisions in the assessee's own case.

The Tribunal held that the assessee was entitled to claim depreciation on the revalued assets as the parent company had offered capital gains on the slump sale, making Section 49(3) applicable. The Tribunal also upheld the deletion of disallowances for management consultancy fees, pre-operative expenses, and loan-related expenses, finding no sufficient evidence to support the AO's claims.

The Tribunal held that the assessee was entitled to claim depreciation on the revalued assets as the parent company had offered capital gains on the slump sale, making Section 49(3) applicable. The Tribunal also upheld the deletion of disallowances for management consultancy fees, pre-operative expenses, and loan-related expenses, finding no sufficient evidence to support the AO's claims.

The Tribunal held that the reopening of assessment was based on a change of opinion without any new material. The assessee had disclosed all material facts during the original assessment, and the AO had applied his mind to them.

The Tribunal held that the assessee was acting as a commission agent for Mother Dairy, and only the commission earned constituted the assessee's income, not the gross turnover. Therefore, the penalty levied under Section 271B was unjustified.

The Tribunal held that the appeal had become infructuous due to the assessee opting for the Vivad se Vishwas Scheme. Consequently, the appeal was treated as withdrawn and dismissed.

The Tribunal held that the NFAC was unjustified in dismissing the appeal in limine as the intimation was likely sent to a wrong email address. The matter was restored to the Assessing Officer to verify the assessee's claim of depreciation.

The Tribunal held that no disallowance under Section 14A was warranted as the investments were managed without incurring any cost to the assessee. The CSR expenses were also allowed as they were considered a business necessity and not capital expenditure, with prior Tribunal orders supporting this view.

The Tribunal held that the AO's assessment order was erroneous and prejudicial to the interest of revenue because the AO failed to conduct proper inquiries regarding the genuineness of the cash deposits, the money lending license, and the reconciliation of bank accounts. The reliance on 'Girvi' receipts was found unsubstantiated without a money lending license.

The Tribunal held that the disallowance under Section 40(a)(ia) was incorrect. It found that the assessee had provided details of freight payments and that the specific amendment to Section 194C(6) requiring declarations from lorry owners was not applicable to the assessment year in question.

The Tribunal held that the Commissioner (Appeals) must decide the appeal on merits, even if proceeding ex parte. The ex parte dismissal for non-prosecution without considering the merits was set aside.

The Tribunal held that the assessee, being part of the searched group, had the onus to prove the validity of share capital. The CIT(A) erred in presuming innocence and not giving due weight to the AO's findings based on seized documents.

The Tribunal held that the amounts deposited in bank accounts were likely from agricultural activities, and the foreign currency deposit receipt did not establish undisclosed income of the assessee. The expense details were considered practice entries on accounting software.

The Tribunal held that the provision for compensation was justified as it related to a disputed liability that was eventually settled for a higher amount. The Tribunal also found that forex trading was within the scope of the assessee's business as per its MOA and that the transactions were genuine, supported by documentation.

The Tribunal held that SFIS credits are not in the nature of income. They are used to reduce the cost of capital goods purchased by the assessee, and are not received as revenue. The credits are utilized only against the purchase of capital goods to set off excise and customs duty.

The Tribunal held that the amounts deposited in bank accounts were likely from agricultural activities, and the foreign currency deposit receipt did not establish undisclosed income of the assessee. The expense details were considered practice entries on accounting software.

The Tribunal held that the additional grounds of appeal regarding the invalidity of Section 148 notices were not purely legal and required factual investigation, thus dismissing them. However, acknowledging the potential issue with the notice address and the assessee's lack of opportunity, the Tribunal set aside the assessment and penalty orders to the Assessing Officer for fresh adjudication.

The Tribunal held that the core issue is whether the assessee is a kachha arahtia or pacca arahtia, which determines if commission income or total purchases constitute the turnover. To ascertain this, the matter was remanded to the AO for further examination.

The Tribunal held that the assessee was entitled to claim depreciation on the revalued assets as the parent company had offered capital gains on the slump sale, making Section 49(3) applicable. The Tribunal also upheld the deletion of disallowances for management consultancy fees, pre-operative expenses, and loan-related expenses, finding no sufficient evidence to support the AO's claims.

The Tribunal found that the contentions raised by the assessee regarding shareholding and payments needed verification. Therefore, the matter was restored to the AO for fresh consideration based on the verification of these facts.