ITAT Delhi Judgments — March 2024

The Tribunal held that the benefit of corporate guarantee should be split 50:50 between the guarantor (assessee) and the borrower (AE). It also directed the AO to re-examine the claim for deduction under Section 80G after admitting necessary evidence.

The Tribunal dismissed the Revenue's appeal as not maintainable due to low tax effect (below Rs. 50 lakhs). The assessee's cross-objection was also dismissed as infructuous because the assessee's grievances had already been addressed and necessary benefits received from the AO through an order under Section 154 of the Income-tax Act, 1961.

The Tribunal held that the benefit of corporate guarantee should be split 50:50 between the guarantor (assessee) and the borrower (AE). It also directed the AO to re-examine the claim for deduction under Section 80G after admitting necessary evidence.

The Tribunal found that the CIT(A) erred by deciding the penalty appeal without first disposing of the quantum appeal. Consequently, the Tribunal set aside the CIT(A)'s order. The matter is restored to the CIT(A) to decide afresh after the quantum appeal is disposed of, and the grounds of appeal are allowed for statistical purposes.

The Tribunal held that the benefit of corporate guarantee should be split 50:50 between the guarantor (assessee) and the borrower (AE). It also directed the AO to re-examine the claim for deduction under Section 80G after admitting necessary evidence.

The Tribunal held that the benefit of corporate guarantee should be split 50:50 between the guarantor (assessee) and the borrower (AE). It also directed the AO to re-examine the claim for deduction under Section 80G after admitting necessary evidence.

The Income Tax Appellate Tribunal quashed the reassessment order, agreeing with the assessee's contention that the reopening was invalid. It found no allegation by the AO of the assessee's failure to disclose fully and truly all material facts, nor was there any fresh tangible material. The Tribunal emphasized that the reopening was initiated beyond four years, despite the original assessment being completed u/s 143(3), making it impermissible.

The Tribunal noted the assessee's contention of not being provided a meaningful opportunity of being heard by the lower authorities. Given the Departmental Representative's agreement, the Tribunal set aside the CIT(A)'s order and restored the matter to the CIT(A) for fresh adjudication, ensuring proper opportunity of hearing to the assessee.

The Tribunal held that the benefit of corporate guarantee should be split 50:50 between the guarantor (assessee) and the borrower (AE). It also directed the AO to re-examine the claim for deduction under Section 80G after admitting necessary evidence.

The Tribunal held that the issue of set-off of excess utilization of funds and accumulation of income is covered by a previous decision in the assessee's own case for AY 2016-17. The AO was directed to allow the assessee's claim.

The Tribunal observed that the DVO closed the matter without estimating the Fair Market Value and the lower authorities made no further independent inquiries. Consequently, the Tribunal restored the issue to the Assessing Officer to ascertain the correct Fair Market Value by referring the matter to the DVO or conducting necessary field inquiries, with the cooperation of the assessee.

The ITAT held that the CIT(A) wrongly applied Section 249(4)(b) because there was no admitted or undisputed tax in the assessee's case, making the requirement to pay advance tax inapplicable. The Tribunal set aside the CIT(A)'s order and restored the matter for a decision on merits, granting the assessee a proper opportunity of hearing.

The Tribunal noted the assessee's claim of technical problems and circumstances beyond control for non-representation, leading to an ex-parte order and rejection of books without proper reasoning. To ensure natural justice, the Tribunal held that the assessee should have been granted a sufficient opportunity to present their case. Consequently, the impugned order of the CIT(A) was set aside, and the assessment was restored to the AO for framing afresh.

The Tribunal held that for completed assessments, additions under Section 153A can only be made if there is incriminating material found during the search. Since the AO did not refer to any seized incriminating material to support the additions, the deletion by the CIT(A) was upheld.

The Tribunal held that for completed assessments, additions under Section 153A can only be made if there is incriminating material found during the search. Since the AO did not refer to any seized incriminating material to support the additions, the deletion by the CIT(A) was upheld.

The Tribunal held that the provision for warranty and the deduction under Section 35(2AB) were allowable, following its own previous decisions and High Court judgments. The ESOP claim was remitted to the Assessing Officer for fresh adjudication.

The Income Tax Appellate Tribunal (ITAT) restored the appeal to the file of the Ld.CIT(A) for de novo fresh adjudication, considering that the assessee was not given a proper opportunity of being heard. The appeal was allowed for statistical purposes.

The Tribunal held that since the material facts were duly disclosed in the assessee's notes to accounts, the reopening of assessment beyond four years was not justified. It found no failure on the assessee's part to disclose material facts, thus rendering the Section 148 notice invalid.

The Income Tax Appellate Tribunal noted that the issue regarding the assessee's status and the application of Section 167B was not properly examined by the CPC. Consequently, the tribunal remanded the matter to the Jurisdictional Assessing Officer (JAO) to properly ascertain the status of the assessee and re-compute the tax.

The Income Tax Appellate Tribunal noted that the issue regarding the assessee's status and the application of Section 167B was not properly examined by the CPC. Consequently, the tribunal remanded the matter to the Jurisdictional Assessing Officer (JAO) to properly ascertain the status of the assessee and re-compute the tax.

The Tribunal found no reason to interfere with the CIT(A)'s order regarding most of the unsecured loans. However, it reversed the CIT(A)'s decision on a portion of a specific loan, deeming it unsustainable. Consequently, the disallowance of interest on unsecured loans was also deleted.

The Tribunal noted that the AO had, in fact, conducted inquiries regarding corpus donations and unsecured loans, and the assessee had provided explanations. Relying on judicial precedents, the Tribunal held that a CIT(E)'s mere "impression" of lack of inquiry is insufficient to invoke Section 263 if the AO has conducted due diligence. As the AO's order was passed after conducting due inquiries, the CIT(E) erred in exercising powers under Section 263.

The Tribunal dismissed the appeal, concurring with the CIT(A) that the assessee failed to provide documentary evidence for the due diligence expenses. It was held that the expenses were related to capital induction and thus capital in nature, not qualifying as revenue expenditure nor for amortization under Section 35D(2) as the purposes specified therein were not met.

The Tribunal found no reason to interfere with the CIT(A)'s order regarding most of the unsecured loans. However, it reversed the CIT(A)'s decision on a portion of a specific loan, deeming it unsustainable. Consequently, the disallowance of interest on unsecured loans was also deleted.

The Tribunal observed that the CIT(A) erred by not condoning the delay and failing to consider the assessee's evidence. Consequently, the case was restored to the CIT(A) for a fresh decision after duly considering the assessee's affidavit and submissions in accordance with the law.

The Tribunal, noting that the orders of the lower authorities were passed ex-parte and considering the submissions from both parties, remanded the issue to the Assessing Officer for de-novo adjudication. The assessee was granted liberty to file all supporting documents and was directed to cooperate with the assessment proceedings.

The Tribunal held that the provision for warranty and the deduction under Section 35(2AB) were allowable, following its own previous decisions and High Court judgments. The ESOP claim was remitted to the Assessing Officer for fresh adjudication.

The Tribunal found that the underlying revisional order under Section 263, which formed the basis of the consequential assessment, had already been quashed by a Coordinate Bench of the Tribunal. Consequently, the consequential assessment order could not be sustained. The Tribunal also held that the CIT(A) erred by dismissing the appeal solely on the ground of delay, without adopting a liberal view or considering the merits of the case.

The Tribunal ruled that an ad-hoc disallowance of expenses based on estimates, without specific evidence of concealment or malafide intention, does not justify a penalty under section 271(1)(c). It emphasized that additions based on lack of supporting evidence, rather than detected concealment, are insufficient for such penalties. Consequently, the penalty was deleted.

The Tribunal upheld the CIT(A)'s decision, finding that the identity and creditworthiness of the company (UMS) were established. The buyback transaction was considered genuine, and the company had complied with the Companies Act provisions. Therefore, the addition under Section 68 was not justified.

The Tribunal held that the levy of interest under section 234B was not sustainable, following a coordinate bench decision affirmed by the Delhi High Court. Regarding additions based on Form 26AS, the Tribunal restored the matter to the AO for verification, stating that mere reflection in Form 26AS does not automatically make income taxable if not received by the assessee.

Following the Jurisdictional High Court's decision, the Tribunal held that a penalty notice issued under section 271 read with 274 is bad in law if it fails to specify the exact limb of section 271(1)(c) under which penalty proceedings are initiated. Consequently, the notice dated 21.03.2013 was declared void ab initio, and the penalty levied under section 271(1)(c) was directed to be deleted.

The Tribunal held that the levy of interest under section 234B was not sustainable, following a coordinate bench decision affirmed by the Delhi High Court. Regarding additions based on Form 26AS, the Tribunal restored the matter to the AO for verification, stating that mere reflection in Form 26AS does not automatically make income taxable if not received by the assessee.

The Tribunal held that the CIT(A) denied the assessee a reasonable opportunity to present its case. Therefore, the matter was restored to the CIT(A) for a fresh decision after providing sufficient opportunity.

The Tribunal found reasonable cause for the delay in filing the appeal before the CIT(A) and condoned it. Consequently, the matter was remitted to the Assessing Officer (AO) for a de novo consideration, ensuring the assessee receives a proper opportunity of being heard.

The Tribunal upheld the CIT(Exemption)'s revisional order passed u/s 263. It was held that donations from accumulated funds under section 11(2) to other trusts, even for specific charitable purposes like construction, are not considered an application of income as per Explanation to section 11(2) read with section 11(3)(d) of the Act. The AO's failure to examine this issue rendered the assessment order erroneous and prejudicial to revenue, justifying the revisional action.

Given the ongoing moratorium on the assessee company, the Ld. AR requested to withdraw the appeal, a request to which the Ld. CIT(DR) had no objection. The tribunal consequently dismissed the appeal as withdrawn, granting the assessee the liberty to revive it after the moratorium is lifted, if so desired, in accordance with law.

The Tribunal upheld the CIT(A)'s decision, confirming that no addition can be made in a Section 153A assessment without incriminating material found during the search, particularly when the investment was already disclosed in the financial statements. The Tribunal relied on the Supreme Court's ruling in PCIT vs. Abhisar Buildwell P. Ltd.

The Tribunal affirmed the CIT(A)'s decision, confirming that the CIT(A) had thoroughly discussed the factual aspects and correctly deleted both additions. It was held that the bank credit represented capital withdrawal from a partnership firm and the fixed asset increase was due to capitalization of the opening balance of project in progress.

The Tribunal held that interest under Section 234B of the Act is not chargeable when tax has been deducted at source by the buyer. The chargeability of interest under Section 234D is consequential. For AY 2020-21, the AO was directed to verify the chargeability of interest under Section 234A.

The Tribunal held that interest under Section 234B of the Act is not chargeable when tax has been deducted at source by the buyer. The chargeability of interest under Section 234D is consequential. For AY 2020-21, the AO was directed to verify the chargeability of interest under Section 234A.

The Tribunal held that interest under Section 234B of the Act is not chargeable when tax has been deducted at source by the buyer. The chargeability of interest under Section 234D is consequential. For AY 2020-21, the AO was directed to verify the chargeability of interest under Section 234A.

The Tribunal, following the Supreme Court's ruling in CIT vs. Abhisar Buildwell (P) Ltd., held that for an unabated assessment under Section 153A, additions must be based solely on incriminating material discovered during the search of the assessee. Since the Assessing Officer failed to provide evidence of such material found in the assessee's possession and relied on material from other persons' searches, the additions were deemed unsustainable. Consequently, the additions challenged in the appeal were quashed.

The Tribunal, relying on the Jurisdictional High Court's ruling in CIT Vs. Dhoomketu Builders & Development P. Ltd., held that a real estate business commences with the acquisition of land. Since the assessee purchased land for business purposes and recorded it as inventory, it was deemed to have commenced operations, making the incurred expenditures allowable deductions despite no revenue generation.

The Tribunal, relying on its previous order in the assessee's own case and High Court pronouncements, held that Section 200A(1)(c) of the Act, which enables the processing of TDS statements and levying of late fees, was introduced with effect from 01.06.2015. Therefore, no late fee under Section 234E could be validly imposed for assessment years or periods prior to this prospective date.

The Tribunal, relying on its previous order in the assessee's own case and High Court pronouncements, held that Section 200A(1)(c) of the Act, which enables the processing of TDS statements and levying of late fees, was introduced with effect from 01.06.2015. Therefore, no late fee under Section 234E could be validly imposed for assessment years or periods prior to this prospective date.

The Tribunal, relying on its previous order in the assessee's own case and High Court pronouncements, held that Section 200A(1)(c) of the Act, which enables the processing of TDS statements and levying of late fees, was introduced with effect from 01.06.2015. Therefore, no late fee under Section 234E could be validly imposed for assessment years or periods prior to this prospective date.

The Tribunal heard both parties and determined that for natural justice, the matter should be remitted back to the CIT(A). The CIT(A) is directed to reconsider the issues afresh after providing the assessee with a proper opportunity of being heard.

The Tribunal held that sub-contracting charges and sales commission received by the assessee do not satisfy the 'make available' condition under Article 12(4) of the India-USA DTAA and are therefore not taxable as Fees for Included Services (FIS). Issues related to interest under sections 234A and 234B, and adjustment of refunds, were remanded to the AO.

The Tribunal held that the lower authorities had not properly examined the explanations regarding purchases from four specific parties. Therefore, the issue was restored to the Assessing Officer for fresh examination of these purchases.