ITAT Delhi Judgments — October 2024

The Tribunal held that the assessee had provided sufficient documentary evidence to establish the identity, creditworthiness, and genuineness of the share capital transactions. The Assessing Officer had not brought any adverse material on record to controvert the assessee's explanation.

The tribunal noted that the tax effect of the appeal was less than Rs. 60 lacs. Therefore, in light of CBDT Circular No. 09 of 2024, the appeal was not admissible.

The Tribunal reiterated its prior decisions, holding that the option money received by the assessee from CUIH is a capital receipt, to be adjusted only at the time of share transfer for capital gain computation. It ruled that the basis for reopening assessments under Section 147 was unsustainable, amounting to a mere change of opinion, and thus quashed the reassessment orders for the impugned assessment years.

The Tribunal held that the PCIT lacked jurisdiction to revise the Transfer Pricing Officer's order as it was passed before the relevant amendment to Section 263. Furthermore, the Tribunal found that the PCIT's actions regarding discontinued business and share-based compensation were also unwarranted as these issues were either not relevant to the assessment year or already addressed.

The Tribunal reiterated its prior decisions, holding that the option money received by the assessee from CUIH is a capital receipt, to be adjusted only at the time of share transfer for capital gain computation. It ruled that the basis for reopening assessments under Section 147 was unsustainable, amounting to a mere change of opinion, and thus quashed the reassessment orders for the impugned assessment years.

The Income Tax Appellate Tribunal held that in the interest of justice, the matter should be remitted back to the file of the Assessing Officer. The AO was directed to consider the issues afresh, pass a speaking order, and provide adequate opportunity of being heard to the assessee, considering the assessee's inability to pursue the matter properly before lower authorities.

The Tribunal held that in the interest of justice and with the consent of both parties, the issues in dispute are remitted back to the file of the Assessing Officer. The AO is directed to decide the matter afresh after providing the assessee with an adequate opportunity of being heard.

The Tribunal reiterated its prior decisions, holding that the option money received by the assessee from CUIH is a capital receipt, to be adjusted only at the time of share transfer for capital gain computation. It ruled that the basis for reopening assessments under Section 147 was unsustainable, amounting to a mere change of opinion, and thus quashed the reassessment orders for the impugned assessment years.

The Tribunal noted the assessee's counsel's submission that no notice from the CIT(A) was received, thus preventing a submission. The Revenue's DR had no objection to the proposition of remitting the case. The Tribunal, in the interest of justice, remitted the matter back to the CIT(A) for fresh consideration, with directions to provide the assessee an adequate opportunity of being heard.

The Tribunal held that Section 10(38) exempts only the income arising from the transfer of specified capital assets, not the entire source of capital gains. Therefore, LTCL on such transactions is eligible to be carried forward.

The Tribunal held that Section 10(38) exempts only the income arising from the transfer of specified capital assets, not the entire source of capital gains. Therefore, LTCL on such transactions is eligible to be carried forward.

The Tribunal upheld the rectification made by the AO and confirmed by the CIT(A), concluding that the correction of the addition amount from Rs. 1,14,95,000/- to Rs. 1,99,90,500/- was an apparent mistake from the record, rectifiable under section 154 of the Act. The Tribunal found no infirmity in the orders of the lower authorities, thereby dismissing the assessee's appeal.

The Tribunal reiterated its prior decisions, holding that the option money received by the assessee from CUIH is a capital receipt, to be adjusted only at the time of share transfer for capital gain computation. It ruled that the basis for reopening assessments under Section 147 was unsustainable, amounting to a mere change of opinion, and thus quashed the reassessment orders for the impugned assessment years.

The Tribunal held that CCL International Ltd. cannot be categorized as a penny stock company, given its substantial business and turnover. Therefore, the denial of exemption under Section 10(38) and the addition for unexplained expenditure were unjustified.

The Tribunal held that no incriminating material was unearthed during the search regarding the agricultural income or the cost of improvement/indexation. Applying the Supreme Court's decision in Abhisar Buildwell, which states that completed assessments can only be reopened and reassessed based on incriminating material found during a search, the tribunal deleted all impugned additions related to agricultural income and cost of improvement/indexation.

The Tribunal held that no incriminating material was unearthed during the search regarding the agricultural income or the cost of improvement/indexation. Applying the Supreme Court's decision in Abhisar Buildwell, which states that completed assessments can only be reopened and reassessed based on incriminating material found during a search, the tribunal deleted all impugned additions related to agricultural income and cost of improvement/indexation.

The Tribunal held that no incriminating material was unearthed during the search regarding the agricultural income or the cost of improvement/indexation. Applying the Supreme Court's decision in Abhisar Buildwell, which states that completed assessments can only be reopened and reassessed based on incriminating material found during a search, the tribunal deleted all impugned additions related to agricultural income and cost of improvement/indexation.

The Tribunal held that the approval granted by the Addl. CIT under Section 153D was mechanical and without due application of mind, rendering the assessment order invalid. This decision was upheld by the Delhi High Court.

The Tribunal held that the approval granted by the Addl. CIT under Section 153D was mechanical and without due application of mind, rendering the assessment order invalid. This decision was upheld by the Delhi High Court.

The Tribunal, following earlier coordinate bench decisions, remanded the matter to the Assessing Officer. The AO is directed to ascertain the correct due date for remittance of EPF/ESIC contributions of employees, specifically considering whether the due date should be determined based on the month of salary disbursement, and to provide the assessee with an adequate opportunity of being heard.

The tribunal, relying on precedents from the Delhi High Court and the Bombay High Court Full Bench, held that a defective omnibus notice which does not clearly specify the limb of section 271(1)(c) vitiates the penalty proceedings. Finding merit in the assessee's appeal, the tribunal concluded that the penalty proceedings were vitiated due to the defective notice and deleted the penalty.

The tribunal held that the payments made to non-resident attorneys, who do not have a PE in India, for services rendered overseas, or as reimbursement of renewal/official fees, are not chargeable to tax in India. Therefore, the assessee was not obligated to deduct tax at source under section 195 of the Income Tax Act.

The Tribunal held that the approval granted by the Addl. CIT under Section 153D was mechanical and without due application of mind, rendering the assessment order invalid. This decision was upheld by the Delhi High Court.

The Tribunal confirmed the CIT(A)'s decision, holding that the assessee's cash sales and deposits were regular and adequately explained, thus not warranting additions under Section 68 or 115BBE. For unaccounted cash sales, only the gross profit, not the entire sales value, could be taxed, acknowledging corresponding purchases. The addition related to unsecured loans was also correctly deleted as the loan was repaid with no adverse findings.

The Tribunal condoned the delay in filing the appeals. However, due to the assessee's non-appearance and the lack of dispute with the CIT(A)'s findings, the Tribunal found no merit in the grounds of appeal.

The Tribunal held that the AO was not justified in rejecting the approved valuer's report for determining the fair market value of land and cost of construction/development without referring the matter to the Departmental Valuation Officer (DVO). Citing precedents, the Tribunal directed the AO to re-compute the fair market value of the land at Rs. 7,250 per sq. yd. (as on 01.04.2001) and to adopt the construction and land development charges as valued by the registered valuer, allowing indexation accordingly.

The Tribunal condoned the delay in filing the appeals. However, due to the assessee's non-appearance and the lack of dispute with the CIT(A)'s findings, the Tribunal found no merit in the grounds of appeal.

The Tribunal found that the assessment orders were passed on March 21, 2022, but the mandatory approval from the JCIT under Section 153D was only received by the AO on March 23, 2022. Since Section 153D explicitly mandates prior approval for assessment orders under Section 153A, the assessment orders passed without such prior approval were deemed to be in clear violation of the statutory provisions. Consequently, the Tribunal quashed the assessment orders for both assessment years.

The Tribunal found that the assessment orders were passed on March 21, 2022, but the mandatory approval from the JCIT under Section 153D was only received by the AO on March 23, 2022. Since Section 153D explicitly mandates prior approval for assessment orders under Section 153A, the assessment orders passed without such prior approval were deemed to be in clear violation of the statutory provisions. Consequently, the Tribunal quashed the assessment orders for both assessment years.

The Tribunal determined that due to the ongoing Corporate Insolvency Resolution Process (CIRP) and the moratorium ordered by the NCLT under Section 19 of the IBC, 2016, the appeal filed by the assessee was not maintainable. Consequently, the appeal was dismissed, with liberty granted to the Assessee/Department/IPR to file an application to recall the order if required.

The Tribunal noted CBDT Circular No.09/2024 dated 17.09.2024, which revised the monetary limit for filing departmental appeals to the ITAT to Rs. 60 lakhs. As the tax effect of the Revenue's appeal was below this limit, the Tribunal dismissed the appeal as not maintainable.

The Tribunal condoned the delay in filing the appeals. However, due to the assessee's non-appearance and the lack of dispute with the CIT(A)'s findings, the Tribunal found no merit in the grounds of appeal.

The tribunal, relying on various High Court judgments, held that transactions involving loans received through journal entries, without any actual cash movement, do not fall within the ambit of section 269SS. Consequently, the penalty imposed under section 271D was unwarranted and deleted, acknowledging the assessee's bona fide belief and the applicability of section 273B.

For ITA No.1046, the Tribunal upheld the penalty deletion, finding the assessee's errors inadvertent and noting the AO's mechanical initiation of penalty proceedings without clear satisfaction. For ITA No.1047, the Tribunal affirmed the FAA's decision to delete quantum disallowances, stating no Section 14A disallowance applies without exempt income and no TDS is required on HUDA payments for external development charges as per settled legal position.

The Income Tax Appellate Tribunal (ITAT) found that the CIT(A) should have condoned the 173-day delay given the reasons provided by the assessee. Consequently, the ITAT set aside the CIT(A)'s order, condoned the delay, and remanded the matter back to the CIT(A) for a decision on the merits after providing the assessee an opportunity of being heard.

The tribunal held that the deduction u/s 54F is allowable for two residential properties, clarifying that "a residential house" does not imply a singular number. Regarding the bank credits, the tribunal found the AO's inference of business activity and subsequent profit estimation unjustified, as various entries were adequately explained as loan repayments, share of compensation from agricultural land, and cash deposits, not business receipts. Therefore, the AO's additions were set aside.

The Tribunal held that actual payment of tax in the UAE is not a prerequisite for claiming treaty benefits. The right of the UAE to tax, even if not exercised, is sufficient to invoke the DTAA, following the principle laid down in the Azadi Bachao Andolan case.

The Tribunal held that the shares in the specified demat account were indeed investments, and the gains should be treated as capital gains, not business income. The Section 14A disallowance was also deleted as it exceeded the actual expenditure incurred.

The Tribunal found that the assessee's audited books of accounts, VAT returns, and other registers showed no discrepancies. It held that the grounds for addition, such as 'abnormal growth in cash sales' and 'unidentified parties', were vague, especially as the assessee demonstrated a direct correlation between cash outflow (stock) and cash deposits. The Tribunal concluded that the addition under Section 68 was not justified, as the AO had accepted the sales and a nexus between cash sales and closing stock was established, and cash sales could reasonably increase during demonetization due to customers using old currency for investment. The CIT(A) erred in sustaining the addition based merely on suspicion.

The ITAT held that the CIT(A) erred by summarily dismissing the appeal without adjudicating on merits, considering the assessee's submissions, or the AO's remand report. It emphasized that the CIT(A) is duty-bound under Section 250(6) to pass a speaking order addressing all grounds and points for determination. Consequently, the ITAT set aside the CIT(A)'s order and remitted the matter back for fresh adjudication on merits, with directions to consider all relevant submissions and the remand report after providing a proper hearing.

The Tribunal condoned the delay and noted that the CIT(A) had passed an ex-parte order without adjudicating the appeal's merits, which violated natural justice principles. Consequently, the matter was remanded back to the CIT(A) for fresh adjudication after providing the assessee an opportunity to be heard.

For ITA No.1046, the Tribunal upheld the penalty deletion, finding the assessee's errors inadvertent and noting the AO's mechanical initiation of penalty proceedings without clear satisfaction. For ITA No.1047, the Tribunal affirmed the FAA's decision to delete quantum disallowances, stating no Section 14A disallowance applies without exempt income and no TDS is required on HUDA payments for external development charges as per settled legal position.

The Income Tax Appellate Tribunal (ITAT) found that the CIT(A) should have condoned the 173-day delay given the reasons provided by the assessee. Consequently, the ITAT set aside the CIT(A)'s order, condoned the delay, and remanded the matter back to the CIT(A) for a decision on the merits after providing the assessee an opportunity of being heard.

The Tribunal held that the shares in the specified demat account were indeed investments, and the gains should be treated as capital gains, not business income. The Section 14A disallowance was also deleted as it exceeded the actual expenditure incurred.

The Income Tax Appellate Tribunal (ITAT) found that the appellant genuinely failed to appear before the AO and CIT(A) due to illness, supported by medical records. In the interest of justice, the Tribunal decided to restore the matter back to the Assessing Officer for a fresh decision in accordance with the law, thereby allowing the appeal for statistical purposes.

The ITAT condoned the 182-day delay, finding that the assessee's illness prevented appearance before both the AO and CIT(A). Considering the material facts and in the interest of justice, the ITAT restored the matter to the file of the Ld. AO for a fresh decision in accordance with law.

The Tribunal condoned the 182-day delay in filing the appeal, finding no malafide intent and acknowledging the appellant's illness preventing appearance in prior proceedings. In the interest of justice, the Tribunal restored the matter to the file of the Assessing Officer for a fresh decision in accordance with law, setting aside the ex-parte orders.

The Tribunal, in the interest of substantial justice, remanded the case back to the NFAC for de novo adjudication. It directed the NFAC to provide the assessee an effective opportunity of being heard, consider all submissions, and allow the submission of fresh evidence.

The Tribunal condoned the 197-day delay, accepting the illness as a genuine cause for non-appearance before the lower authorities. In the interest of justice, the matter was restored to the Assessing Officer for a fresh decision.

The Tribunal condoned the delay in filing the appeal, accepting the medical illness as sufficient cause. However, despite issuing notice, the assessee or their representative did not appear for the hearing. Considering that the legal issue regarding employees' contributions to PF/ESI remitted belatedly but before ITR filing is settled in favor of the revenue by the Supreme Court's decision in Checkmate Services Ltd., the Tribunal dismissed the appeal on merits.