ITAT Delhi Judgments — September 2022

The Tribunal held that the payment of Rs. 37 crores made by the assessee to DLF Ltd. for development rights was an eligible expense. The Tribunal found no dispute with the payments made to DLF Home Developers Ltd. and for land rights, and noted that the recipient had paid taxes on these amounts.

The Tribunal held that the assessee's claim of exploring a new business was a general statement and could not justify business promotion expenses when the primary business was closed. The disallowance of these expenses was upheld.

The Tribunal followed a coordinate bench's decision in the assessee's own case for a prior assessment year. This decision was based on an NCLT order that extinguished all government dues due to a significant difference between secured creditors and liquidation value.

The Tribunal found that the Revenue Department failed to produce the assessment record and reasons recorded by the Assessing Officer. Therefore, the case was remitted back to the Assessing Officer to pass a fresh assessment order.

The Tribunal upheld the CIT(A)'s order, finding that the assessee failed to establish the identity, creditworthiness, and genuineness of the unsecured loan transactions. The assessee remained absent and provided no supporting material to challenge the lower authorities' findings.

The Tribunal condoned the delay in filing the appeal due to the assessee's reasonable cause. The appeal was admitted for hearing, and the substantive grounds regarding capital gains and deductions are to be adjudicated.

The Tribunal held that the Commissioner (Appeals) erred in not determining the nature of subsidies/incentives (capital vs. revenue) before deciding tax liability under Section 115JB. The Tribunal also dismissed the Revenue's appeal regarding the recomputation of disallowance under Section 14A.

The Tribunal upheld the orders of the lower authorities, agreeing that the franchisee fee was for professional/technical services liable for TDS under Section 194J. Since the assessee failed to deduct TDS and provided no rebuttal, the demand for short deduction and interest was confirmed.

The Tribunal held that since the quantum proceedings were restored, the penalty proceedings should also be restored back to the Assessing Officer. The impugned penalty order was set aside.

The tribunal held that the penalty was not justified as the disallowance was based on a subjective judgment of commercial expediency and not necessarily concealment or furnishing of inaccurate particulars. An erroneous claim made bona fide does not warrant penalty.

The Tribunal dismissed the appeal as withdrawn due to the assessee opting for settlement under the Vivad Se Vishwas Scheme. The dismissal was with liberty to restore the appeal if the settlement was not finalized.

The ITAT held that the assessment order was framed pursuant to a Section 263 order which was subsequently quashed by the ITAT itself. Therefore, the present appeal arising from the quashed order cannot survive.

The Tribunal considered the request for withdrawal of the appeal and, with no objection from the respondent, allowed the assessee's request. The appeal was accordingly dismissed as withdrawn.

The Tribunal held that the initial rejection order, though granting liberty to re-apply, was not cryptic and did not violate natural justice. Since subsequent registrations were granted and renewed, restoring the original applications for re-adjudication was deemed unnecessary.

The Tribunal held that the appeal filed by the Revenue was not maintainable due to low tax effect, as per CBDT Circular No. 17/2019. The appeal was dismissed on this ground.

The Tribunal held that the assessee was denied an opportunity to be heard and that the principle of natural justice was violated. Therefore, the order of the Commissioner was set aside.

The Tribunal found that the CIT(A) had dismissed the assessee's appeal in limine. Therefore, the Tribunal restored the appeal to the CIT(A) for a decision on merits after providing the assessee an opportunity to be heard.

The Tribunal noted that the CIT(A) had not dealt with the case laws cited by the assessee. Therefore, in the interest of justice, the matter was remitted back to the CIT(A) for re-examination of the applicability of these case laws.

The Tribunal agreed with the assessee that the assumption of jurisdiction by the Assessing Officer was without foundation, as the assessee had indeed filed a return of income. Therefore, the reassessment notice and order were quashed.

The Tribunal held that the earning of income is not a precondition for allowing business expenditure, especially for tech start-ups with a long gestation period. The Tribunal found that the expenses were revenue in nature and had been allowed in preceding years.

The Tribunal upheld the CIT(A)'s decision to delete the addition, noting that the Assessing Officer accepted in the remand report that bank statements showed payments to the creditors in the subsequent financial year. The Tribunal found no infirmity in the CIT(A)'s order.

The Tribunal held that the assessment order and demand notice were invalid as they lacked the signature of the Assessing Officer, following the precedent set by the Supreme Court. Consequently, all subsequent proceedings were also deemed invalid.

The Tribunal dismissed the appeal as withdrawn, acknowledging the assessee's settlement under the Vivad Se Vishwas Scheme. Liberty was granted to restore the appeal if the settlement is not finalized.

The Tribunal held that the Pr. CIT's order contained a clear computational mistake. Since such a mistake is rectifiable under Section 154, the Tribunal decided not to exercise its powers and remanded the matter back to the Pr. CIT for correction.

The Tribunal held that the initial rejection order, though granting liberty to re-apply, was not cryptic and did not violate natural justice. Since subsequent registrations were granted and renewed, restoring the original applications for re-adjudication was deemed unnecessary.

The Tribunal held that the earning of income is not a precondition for allowing business expenditure, especially for tech start-ups with a long gestation period. The Tribunal found that the expenses were revenue in nature and had been allowed in preceding years.

The Tribunal held that it could not entertain an additional ground of appeal and additional evidence as the relevant facts were not available before the lower authorities. The assessee's new claim that the land was not a capital asset was therefore rejected.

The Tribunal held that the reassessment order was vitiated because the notice under Section 143(2) was not issued within the statutory time limit of six months from the end of the financial year in which the return was filed. Therefore, the assessment proceedings were not sustainable.

The Tribunal noted that the assessee had opted for the Vivad Se Vishwas Scheme and agreed to withdraw the appeal. The appeal was dismissed as withdrawn.

The Tribunal held that cash withdrawn from a bank account can remain with the assessee for extended periods and be redeposited later, especially when the source of withdrawal is not disputed. The addition was deleted as the revenue failed to prove the withdrawn cash was utilized elsewhere.

The Tribunal held that the provision for loss on investment was indeed an unascertained liability, especially since the assessee had added it back to book profit under Section 115JB. Therefore, the Pr. CIT's order was justified.

The ITAT found that the assessee was not provided with a due opportunity to explain the delay before the CIT(A). Therefore, the matter was restored to the CIT(A) for a fresh decision after providing a proper hearing.

The Tribunal upheld the addition made by the AO, finding that the assessee failed to establish the genuineness of the share transactions. The financial capacity of Shri Manoj Aggarwal was found to be insufficient for the transactions, and his signatures on sale bills did not match. The payment for the sale of shares was also found to be delayed and returned.

The Tribunal affirmed the CIT(A)'s order, finding that the assessee failed to prove the genuineness of the share capital transaction. The evidence submitted was considered a 'smoke screen' to cover unaccounted income.

The Tribunal held that disallowance for belated payment of employee's contribution to ESI and EPF is not called for if deposited before the due date of filing the Income Tax Return. This decision aligns with the legal proposition that such payments are allowable deductions.

The Tribunal held that the CIT(A) was justified in allowing working capital adjustment and deleting the disallowance on printing of packing material. The Revenue failed to provide distinguishing features or contrary judicial pronouncements to overturn the CIT(A)'s decision.

The Tribunal held that the Commissioner (Appeals) erred in not determining the nature of subsidies/incentives (capital vs. revenue) before deciding tax liability under Section 115JB. The Tribunal also dismissed the Revenue's appeal regarding the recomputation of disallowance under Section 14A.

The Tribunal held that the disallowance of employee's contribution to PF/ESI made on account of late deposit, when such deposits were made before the filing of the return of income, was not justified. The amendment brought by the Finance Act 2021 was held to be prospective and not applicable to the assessment years in question.

The Tribunal held that the penalty on disallowance under section 14A was deleted by the CIT(A) and the Revenue did not appeal. For the other two issues (DTAA and 80IA), the Tribunal followed its earlier decision in the assessee's own case where the quantum additions were deleted, thus the penalty did not survive.

The Tribunal held that the disallowance of employee's contribution to PF/ESI made on account of late deposit, when such deposits were made before the filing of the return of income, was not justified. The amendment brought by the Finance Act 2021 was held to be prospective and not applicable to the assessment years in question.

The Assessing Officer rectified the arithmetical error, reducing the demand. As the only substantive ground of appeal was resolved, the assessee requested to withdraw the appeal.

The Tribunal restored the appeal to the files of the CIT(A). The CIT(A) was directed to decide the appeal afresh after providing the assessee with a reasonable and adequate opportunity of being heard.

The Tribunal held that interest received under Section 28 of the Land Acquisition Act on enhanced compensation is part of the compensation and is exempt under Section 10(37) if agricultural land is acquired. Therefore, the addition made by the AO was deleted.

The Tribunal held that the disallowance of employee's contribution to PF/ESI made on account of late deposit, when such deposits were made before the filing of the return of income, was not justified. The amendment brought by the Finance Act 2021 was held to be prospective and not applicable to the assessment years in question.

The Tribunal held that the disallowance of employee's contribution to PF/ESI made on account of late deposit, when such deposits were made before the filing of the return of income, was not justified. The amendment brought by the Finance Act 2021 was held to be prospective and not applicable to the assessment years in question.

The Tribunal held that the disallowance of employee's contribution to PF/ESI made on account of late deposit, when such deposits were made before the filing of the return of income, was not justified. The amendment brought by the Finance Act 2021 was held to be prospective and not applicable to the assessment years in question.

The Tribunal upheld the disallowance of interest expenditure under Section 14A read with Rule 8D. The assessee's grounds of appeal were found to be without merit.

The Tribunal held that the penalty on disallowance under section 14A was deleted by the CIT(A) and the Revenue did not appeal. For the other two issues (DTAA and 80IA), the Tribunal followed its earlier decision in the assessee's own case where the quantum additions were deleted, thus the penalty did not survive.

The Tribunal held that the disallowance of employee's contribution to PF/ESI for delayed payment, when deposited before the due date of filing the return of income, is not permissible under Section 143(1). The amendment by Finance Act, 2021, is prospective and not applicable to the assessment year in question.

The Tribunal held that there was no legal requirement for the assessee to deduct tax at source on payments made to HUDA for EDC. Therefore, the disallowance made under Section 40(a)(ia) was unsustainable.