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441 orders · Page 3 of 9
The Tribunal addressed the issue of CSR expenses and Section 80G deduction. The assessee contributed Rs.156.68 crores to REC Foundation for charitable objectives. The AO disallowed the deduction, stating CSR expenses are mandatory. The Ld. CIT(A) allowed the deduction, holding CSR expenses are philanthropic. The Tribunal, relying on the Ld. CIT(A)'s findings and various precedents including Interglobe Technology Quotient (P.) Ltd. v. ACIT and Ericsson India Global Services (P) Ltd. v. DCIT, held that CSR expenditure, while statutorily mandated, remains philanthropic and qualifies for deduction under Section 80G, provided the donee institution is registered under Section 80G and other conditions are met. The Tribunal directed the AO to allow the deduction subject to factual verification of these conditions. The Tribunal also noted that grounds 1, 5, 6, and 7 raised by the assessee were general or not pressed and were dismissed. The Tribunal dismissed the revenue's appeals for AY 2020-21 and AY 2021-22. The assessee's appeals for AY 2018-19 and AY 2019-20 were partly allowed, and the revenue's appeals for AY 2018-19 to 2021-22 were dismissed.
The Tribunal observed that the lower appellate authority had not adjudicated the issues on merits and had merely affirmed the Assessing Officer's ex-parte order. In the interest of justice, the matter was restored for de novo adjudication.
The Tribunal remanded the matter to the CIT(A) for fresh adjudication on merits after giving the assessee an opportunity to be heard. The assessee was also directed to be vigilant and comply with the requirements.
The Tribunal held that the CIT(A) rightly deleted the protective addition as the transactions between the assessee and M/s HMA Agro Industries Ltd. were found to be genuine business transactions. The estimation of income without a proper basis was also not justified.
The Tribunal held that the addition on account of exchange of land was not justified as the assessee had not received any monetary consideration. However, the penalty levied under Section 271(1)(c) was quashed due to a defective show-cause notice.
The Tribunal held that processing fees and prepayment premiums received by the assessee engaged in long-term finance business have a direct nexus with that business. Therefore, such income is eligible for deduction under Section 36(1)(viii) of the Act.
The Tribunal held that the addition on account of exchange of land was not justified as the assessee had not received any monetary consideration. However, the penalty levied under Section 271(1)(c) was quashed due to a defective show-cause notice.
The Tribunal found that the approval under section 153D was granted mechanically and not with due application of mind, citing decisions of the jurisdictional High Courts. The satisfaction recorded by the Assessing Officer under section 153C was also found to be lacking specificity regarding the seized material's relevance to the assessee's income.
The Tribunal found that the approval under section 153D was granted mechanically and not with due application of mind, citing decisions of the jurisdictional High Courts. The satisfaction recorded by the Assessing Officer under section 153C was also found to be lacking specificity regarding the seized material's relevance to the assessee's income.
The Tribunal condoned the delay, admitted the appeal, and agreed that the CIT(A) order was ex-parte. Both counsels agreed that the matter should be remitted back to the CIT(A) for fresh adjudication, with the Revenue not objecting.
The CIT(A) allowed the assessee's appeal on the legal ground that the assessment should have been made under section 153C of the Act, as the assessment year fell within the block period determined for a non-searched person. The Tribunal concurred with the CIT(A)'s view.
The Tribunal held that the CIT(A) rightly deleted the protective addition as the transactions between the assessee and M/s HMA Agro Industries Ltd. were found to be genuine business transactions. The estimation of income without a proper basis was also not justified.
The Tribunal held that processing fees and upfront charges received by the assessee have a direct nexus with their business of providing long-term finance. Therefore, these incomes are eligible for deduction under Section 36(1)(viii) of the Act, as supported by various judicial precedents.
The Tribunal held that the TPO wrongly applied TNMM. The transactions between the JV and the appellant were considered international transactions only due to administrative convenience in routing invoices through the JV office. The Tribunal found that these were effectively third-party transactions and that the CUP method was appropriate for benchmarking back-to-back transactions. The revenue's appeal was dismissed.
The Tribunal held that the addition on account of cash gifts was rightly made by the AO as the assessee failed to provide basic details like names of donors, relationship, and PAN. The addition for credit card payments was deleted as the same was duly explained. The deletion of the addition for the sale of agricultural land was upheld as the land was not a capital asset and the transaction was outside the purview of capital gains.
The Tribunal held that processing fees, upfront charges, and similar incidental income have a direct nexus with the business of providing long-term finance. Therefore, such income is eligible for deduction under Section 36(1)(viii) of the Act.
The Tribunal held that payments made to unrelated and independent parties for business purposes cannot be disallowed on grounds of being excessive or unreasonable, especially when the books of account were not rejected. The Tribunal found that the assessee had provided sufficient documentation and that the nature of the services required independent agencies.
The Tribunal noted that the assessee did not appear for the hearings and refused to accept the notices, showing a lack of interest in pursuing the appeal. The issues pertained to material found during a search related to the Kuldeep Bishnoi Group. The CIT(A) had found the assessee's submissions unacceptable and dismissed the grounds.
The CIT(A) noted that the notice under Section 153C was issued beyond the six-year period prescribed by law, based on decisions of the High Court. The aggregate income escaping assessment was also found to be less than Rs. 50 lakhs for the relevant assessment years. Therefore, the CIT(A) annulled the assessment order.
The Tribunal held that since the Section 148 notice was served after the amendment by the Finance Act, 2021, the reopening proceedings ought to have been initiated under the 'New Scheme' (Sections 148A and amended Section 148). As the AO failed to follow the prescribed procedure under Section 148A, the reassessment order was quashed.
The Tribunal noted that the assessee is a cooperative society dealing with its own members, and the lower authorities overlooked the details submitted by the assessee. The Tribunal found that the AO made additions without understanding the nature of the assessee's activities and that the grounds raised by the assessee should be allowed.
The CIT(A) allowed the assessee to submit additional evidence, finding that the assessee was prevented by sufficient cause from producing them earlier. The CIT(A) then adjudicated the appeal on merits, deleting the ad-hoc disallowance of warranty provisions.
The Tribunal held that the delay of 164 days in filing the appeal before the Ld. CIT(A) against the assessment order dated 01.09.2022 deserves to be condoned, in light of the explanation submitted by the assessee. Consequently, both appeals were restored back to the Ld. CIT(A) for fresh adjudication on merits, with a direction to provide the assessee with due opportunity. The assessee was also directed to be vigilant and make requisite compliance before the Ld. CIT(A). The Tribunal did not decide the merits of the assessment or penalty orders, as the appeals were being remanded due to procedural issues. The ratio decidendi is that procedural delays, when adequately explained, can be condoned to allow for a decision on merits, especially when the other party does not object to a remand.
The Tribunal held that penalty proceedings are penal in nature and require clarity. The AO failed to specify any clause from Section 270A(9) for misreporting, making the penalty order ambiguous and arbitrary. Following precedent, the Tribunal quashed the penalty.
The Tribunal held that the assessee, being a partnership firm, had discharged its onus under Section 68 by establishing the identity, creditworthiness, and genuineness of the capital transactions with its partners. The Tribunal noted that the second proviso to Section 68, requiring explanation of 'source of source', is applicable to companies, not partnership firms.
The Tribunal held that based on the concession made by the Revenue before the Supreme Court in the Rajeev Bansal case, all notices issued on or after April 1, 2021, for AY 2015-16, would have to be dropped. The reassessment proceedings initiated by the notice dated 03.04.2022 were therefore quashed.
The Tribunal held that the error in filling the return was a clerical and inadvertent mistake and should not lead to the disallowance of the legitimate claim for exemption. The assessee was found to be running an educational institution with receipts below the prescribed limit for exemption.
The Tribunal held that a subsequent change in judicial pronouncement cannot be a ground for rectifying a mistake apparent on the record under Section 154 of the Act, as the original assessment was based on the law prevalent at that time. The Tribunal referred to various High Court and Supreme Court decisions to support this.
The Tribunal noted that the CIT(A) dismissed the appeals ex-parte. The assessee requested a remand for fresh adjudication on merits. The Tribunal found that the delay in filing the appeal deserved to be condoned and restored both appeals to the CIT(A) for fresh adjudication.
The CIT(A) dismissed the appeal in limine, holding that the assessee failed to show sufficient cause for the delay. The Tribunal noted that the delay was allegedly due to notices being sent to a wrong email ID, while the correct email ID was provided in Form 35 and on the IT portal.
The Tribunal found that the approval under section 153D was granted mechanically and not with due application of mind, citing decisions of the jurisdictional High Courts. The satisfaction recorded by the Assessing Officer under section 153C was also found to be lacking specificity regarding the seized material's relevance to the assessee's income.
The tribunal noted that the appeal was time-barred by 42 days due to the assessee not receiving communications due to an incorrect email ID. The delay was condoned. The tribunal restored the matter to the CIT(A) for fresh adjudication.
The Tribunal found that the approval under section 153D was granted mechanically and not with due application of mind, citing decisions of the jurisdictional High Courts. The satisfaction recorded by the Assessing Officer under section 153C was also found to be lacking specificity regarding the seized material's relevance to the assessee's income.
The Tribunal found that neither the assessee nor the department's stand could be accepted in its entirety. The assessee had not been able to properly explain the source of the sustained amount of Rs. 11,57,000/-, nor could the department dismiss all relevant evidence. In the interest of justice, the Tribunal decided to confirm the addition of Rs. 5,27,550/- in respect of parties mentioned at serial numbers (v) to (vii) of the CIT(A)'s order. The remaining addition of Rs. 6,29,450/- was directed to be deleted, with the rider that this decision would not serve as a precedent. Consequently, the assessee received a relief of Rs. 6,29,450/-. The Tribunal noted that necessary computation would follow as per law. The issue of whether the entire Rs. 11,57,000/- was unexplained was decided by partly confirming and partly deleting the addition.
The Tribunal held that processing fees and upfront charges received by the assessee in the business of long-term finance have a direct nexus with the business and are eligible for deduction under Section 36(1)(viii). The Tribunal relied on High Court and AAR rulings in similar cases.
The Tribunal found that the approval under section 153D was granted mechanically and not with due application of mind, citing decisions of the jurisdictional High Courts. The satisfaction recorded by the Assessing Officer under section 153C was also found to be lacking specificity regarding the seized material's relevance to the assessee's income.
The Tribunal noted that one of the grounds raised by the Revenue was not part of the original assessment. Regarding the section 14A disallowance, the Tribunal observed that the CIT(A) had followed judicial consistency in deleting proportionate interest expenditure. The Tribunal found no merit in the Revenue's grounds.
The Tribunal found that the approval under section 153D was granted mechanically and not with due application of mind, citing decisions of the jurisdictional High Courts. The satisfaction recorded by the Assessing Officer under section 153C was also found to be lacking specificity regarding the seized material's relevance to the assessee's income.
The Tribunal held that processing fees and upfront charges received by the assessee engaged in long-term finance business have a direct nexus with that business and are eligible for deduction under Section 36(1)(viii). The court referenced High Court and AAR rulings supporting this view.
The Tribunal held that the TPO wrongly applied TNMM. The transactions between the JV and the appellant were considered international transactions only due to administrative convenience in routing invoices through the JV office. The Tribunal found that these were effectively third-party transactions and that the CUP method was appropriate for benchmarking back-to-back transactions. The revenue's appeal was dismissed.
The Tribunal found that the approval under section 153D was granted mechanically and not with due application of mind, citing decisions of the jurisdictional High Courts. The satisfaction recorded by the Assessing Officer under section 153C was also found to be lacking specificity regarding the seized material's relevance to the assessee's income.
The Tribunal acknowledged the possibility of communication gaps and noted a lack of effective compliance with Section 250(6) of the Act in the lower appellate order. Therefore, in the interest of justice, the matter was set aside and restored to the CIT(A) for fresh adjudication.
The Tribunal held that Section 69C of the Income Tax Act, 1961, is applicable only when an assessee incurs expenditure and offers no explanation about the source thereof, or the explanation is unsatisfactory. It does not apply to the authenticity of the expenditure itself if the expenditure is recorded in the books of account. In this case, the purchases of Rs. 2,97,66,224/- were duly recorded in the assessee's books of accounts, meaning the source of expenditure was explained. The Tribunal relied on the Delhi High Court's decision in CIT vs. M/s Radhika Creation, which held that Section 69C focuses on the 'source' of expenditure, not its authenticity. The AO's attempt to question the authenticity of expenditure without rejecting the books of account was deemed incorrect. Furthermore, the assessee, operating in an SEZ, had provided documentary evidence like bank statements, invoices, and shipping bills, which were authenticated by Customs authorities. The Tribunal found that the AO had not brought on record any defect or discrepancy in this evidence. The Tribunal also noted that non-response to notices under Section 133(6) by parties cannot be a ground for adverse inference against the assessee, citing decisions of the Delhi High Court in PCIT v Wel Intertrade Pvt. Ltd. and the Mumbai Tribunal in Prabhat Gupta Vs. ITO. Therefore, the addition made by the AO was held unsustainable and liable for deletion. The assessee's cross-objection was allowed, and the Revenue's appeal was dismissed as infructuous.
The Tribunal found no reason to interfere with the CIT(A)/NFAC's remand directions. The assessee was granted liberty to raise all factual and legal grounds before the assessing authority in the consequential proceedings.
The Tribunal held that the disallowance under Section 40(a)(ia) is allowable if the tax has been paid in the subsequent year, directing the AO to verify and grant the benefit of the first proviso to Section 40(a)(ia). Regarding the Section 68 addition, the Tribunal found that the assessee failed to establish the genuineness and creditworthiness of the cash credits, rejecting the ground. The penalty under Section 271(1)(c) for the Section 68 addition was deleted as the onus of proving genuineness is subjective and based on the facts of the case.
The Tribunal held that the delay on the developer's part should not result in the denial of the section 54 deduction to the assessee. The Tribunal accepted the assessee's section 54 deduction claim based on relevant case laws.
The Tribunal held that the disallowance of warranty provision made by the assessee was permissible based on scientific basis and past records, citing Supreme Court decisions. Regarding the transfer pricing adjustment for corporate mark fee, the matter was remanded to the AO for re-verification if the agreements were identical to a previously decided case. The revenue's appeal against the deletion of addition on account of advance from customers was dismissed, relying on previous decisions and High Court affirmations.
The Tribunal held that Section 238 of the IBC has an overriding effect over other statutes, including the Income Tax Act, as per Supreme Court precedent. Consequently, all claims, including those from the Income Tax Department, are to be entertained by the Official Liquidator.
The Tribunal noted that the Supreme Court held such expenditure to be revenue in nature, allowable under Section 37(1). However, since the assessee had claimed depreciation over several years and sought to continue this due to practical difficulties, the Tribunal allowed the claim for depreciation, considering it revenue-neutral.
The Tribunal held that since the CBDT condoned the delay in filing the return of income and an effect order was passed by the PCIT, the return filed by the assessee is to be treated as regular and valid. Therefore, the assessee is entitled to the deduction under Section 80-IA.