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441 orders · Page 4 of 9
The Tribunal acknowledged the possibility of communication gaps and non-compliance with statutory provisions. Considering the larger interest of justice, the Tribunal decided to set aside the appeal and restore it to the CIT(A)/NFAC for fresh adjudication.
The Tribunal held that the loose sheets of paper found during the search were irrelevant as evidence under Section 34 of the Evidence Act, as they were uncorroborated by any books of account and lacked dates or pertained to different assessment years. The additions made by the Assessing Officer based on these documents were not found to have merit.
The Tribunal condoned the delay in filing the appeal. It found that the CIT(A) had incorrectly disposed of the appeal against the assessment order without deciding on merits, due to confusion over the Vivad Se Vishwas Scheme. The matter was restored to the CIT(A) for a fresh hearing and decision.
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 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 PCIT initiated proceedings under Section 263 of the Income Tax Act, 1961, holding that the AO's order was erroneous and prejudicial to the interest of revenue. The PCIT observed that the AO had not properly examined the genuineness of expenses related to entities not registered under GST and had not made sufficient inquiries regarding the directors.
The Tribunal held that the assessment year in question was beyond the maximum period of 10 Assessment Years from the date of satisfaction recorded under Section 153C. Relying on the jurisdictional High Court's decision in PCIT Vs. Ojjus Medicare Pvt. Ltd., the Tribunal found no reason to interfere with the CIT(A)'s order.
The Tribunal noted that the assessee failed to appear before the First Appellate Authority despite multiple notices and did not provide necessary details or corroborative evidence. The Tribunal also observed that a ground regarding the absence of approval under Section 153D was raised before them but not effectively before the CIT(A).
The Tribunal held that the AO erred in calculating the figures from the Tax Audit Report and failed to consider the amounts related to reimbursement transactions with sister concerns. These reimbursements were disclosed and documented, and the identity and creditworthiness of the lenders were not questioned. Therefore, the addition made by the AO was liable to be deleted.
The Tribunal noted that the assessee failed to appear before the First Appellate Authority despite multiple notices and did not provide necessary details or corroborative evidence. The Tribunal also observed that a ground regarding the absence of approval under Section 153D was raised before them but not effectively before the CIT(A).
The Tribunal held that the penalty levied under Section 271(1)(c) was not warranted. The disallowance was made because the AO considered the expense to be capital in nature, while the assessee treated unrecoverable export benefits and security deposit as revenue expenditure. The Tribunal found that the classification of an expense as revenue or capital is subject to different interpretations of law and constitutes a 'debatable issue'. Therefore, imposing a penalty on such an addition is not justified. The Tribunal distinguished between a 'wrong claim' and a 'false claim', stating that only a false claim may invite punitive action. The AO failed to establish that the claim was false, that there was any concealment of income, or that inaccurate particulars were furnished. Following the decision of the Hon'ble Supreme Court of India in Reliance Petro Products Ltd. (2010) 322 ITR 158 (SC), the Tribunal directed the AO to delete the penalty levied. No issue was expressly left undecided.
The CIT(A) noted that the notice under Section 153C was issued on 15.11.2022. Citing the decision of the Delhi High Court in Ojjus Medicare, the CIT(A) held that the period of six assessment years for Section 153C should be calculated from six years prior to the assessment year in which the seized material was handed over to the AO. As the satisfaction note was recorded on 04.11.2022, the six-year period would be from AY 2017-18 to 2022-23. Therefore, the notice and subsequent assessment order for AY 2014-15 were beyond the permissible period and annulled.
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 held that the reopening of the assessment was procedurally valid and substantively justified, as the AO had received credible information from the Investigation Wing and conducted his own inquiries. The alleged accommodation entries pertained to the impugned year, and the payment made was considered unexplained expenditure.
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 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 the CIT(A) erred in enhancing the assessment by adding Rs. 9,25,00,000/-. Citing the Supreme Court decision in CIT v. Rai Bahadur Hardutroy Motilal Chamaria, the Tribunal ruled that the CIT(A)'s power of enhancement under section 251(1)(a) is restricted to the subject matter of assessment or sources of income considered by the AO from the point of view of taxability. Since the AO had only considered and added Rs. 80,00,000/-, the CIT(A) could not travel outside the record to introduce new sources of income for enhancement. Various other judicial precedents also supported this view. Therefore, the CIT(A)'s enhancement action was reversed. Regarding the addition of Rs. 80,00,000/- made by the AO, the Tribunal noted that the assessee had sought to withdraw its appeal. Consequently, the AO's addition of Rs. 80,00,000/- was upheld. The assessee's quantum appeal (ITA No. 1699/Del/2019) was partly allowed. For the penalty appeal (ITA No. 5544/Del/2019), the Tribunal, relying on CIT v. Reliance Petro products, held that the penalty under section 271(1)(c) was wrongly invoked. The penalty appeal was accepted in full.
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 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 noted that the AO did not record any adverse comments on the creditworthiness of the lender during the assessment proceedings. The CIT(A) had considered the documents provided by the assessee, including the loan agreement, bank statement, and ITRs of the lender, and found the transactions to be genuine. The Revenue failed to show any infirmity in the CIT(A)'s findings.
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 condoned the delay and admitted the appeal. While acknowledging the assessee's claim about sales and a raised legal issue not addressed by the lower authorities, the Tribunal noted the assessee's failure to appear and provide factual details. Consequently, the matter was set aside and restored to the Assessing Officer for a fresh assessment after providing the assessee an opportunity to be heard.
The Tribunal held that the assessee had sufficient interest-free funds available, which were more than the investments yielding dividend income. Furthermore, disallowance under Section 14A is not applicable to Minimum Tax Computation.
The Tribunal decided on the issues as follows: On the first issue concerning the disallowance of INR 17,72,45,000/- for loan write-off, the Tribunal allowed the ground of appeal for statistical purposes. It directed the Assessing Officer (AO) to verify compliance with Section 36(2)(v) and whether any part of the disallowed amount was recovered and offered to tax in subsequent assessment years. For the second issue regarding prior period expenses of INR 55,62,000/-, the Tribunal upheld the directions of the CIT(A), which had remanded the issue to the AO for verification. Consequently, the assessee's ground of appeal was dismissed. The third issue concerning the initiation of penalty proceedings under Section 271(1)(c) was dismissed as premature. The fourth issue regarding the disallowance of INR 15,00,18,000/- for the special reserve was dismissed. The Tribunal held that while Section 36(1)(viii) provides a limit for deduction, the assessee is only entitled to the deduction for the actual amount transferred to the special reserve from the Profit & Loss Account, not the maximum permissible limit if it exceeds the actual transfer. Therefore, the order of the CIT(A) was upheld. The appeal in ITA No.4170/Del/2025 was partly allowed, and the appeal in ITA No.5552/Del/2024 was dismissed.
The Tribunal held that the AO's denial of 50% of the cost of construction was arbitrary and lacked basis. The contractor had provided confirmation and a breakup of expenses, along with personal details and income tax returns, which could not be dismissed. The AO's doubt about the contractor's age and qualifications for a small construction project was misplaced.
The Tribunal held that the CIT(A) erred in enhancing the assessment by adding Rs. 9,25,00,000/-. Citing the Supreme Court decision in CIT v. Rai Bahadur Hardutroy Motilal Chamaria, the Tribunal ruled that the CIT(A)'s power of enhancement under section 251(1)(a) is restricted to the subject matter of assessment or sources of income considered by the AO from the point of view of taxability. Since the AO had only considered and added Rs. 80,00,000/-, the CIT(A) could not travel outside the record to introduce new sources of income for enhancement. Various other judicial precedents also supported this view. Therefore, the CIT(A)'s enhancement action was reversed. Regarding the addition of Rs. 80,00,000/- made by the AO, the Tribunal noted that the assessee had sought to withdraw its appeal. Consequently, the AO's addition of Rs. 80,00,000/- was upheld. The assessee's quantum appeal (ITA No. 1699/Del/2019) was partly allowed. For the penalty appeal (ITA No. 5544/Del/2019), the Tribunal, relying on CIT v. Reliance Petro products, held that the penalty under section 271(1)(c) was wrongly invoked. The penalty appeal was accepted in full.
The Tribunal held that the belated filing of the tax audit report Form 10B is a directory provision and not mandatory. Therefore, the assessee's claim for exemption under section 11 should not have been refused solely on this ground.
The Tribunal held that the belated filing of the tax audit report Form 10B is a directory provision and not mandatory. Therefore, the assessee's claim for exemption under section 11 should not have been refused solely on this ground.
The Tribunal noted the assessee failed to reconcile and verify the cash deposits as business sales. However, it held that section 115BBE applies only from 01.04.2017, directing assessment under normal provisions for the relevant period, and allowed a lump sum estimation of GP @ 6% on the deposits treated as sales.
The Tribunal decided both issues in favor of the assessee, granting partial relief. Regarding the addition of Rs. 11,25,400/- under section 69A, the Tribunal acknowledged the assessee's admitted trading in agricultural produce. However, it noted the assessee's failure to fully satisfy the lower authorities regarding the actual carrying out of these activities in the relevant year. Considering the assessee's socio-economic status, the Tribunal deemed a lump sum addition of Rs. 1,25,400/- to be just and proper, thereby granting the assessee relief of Rs. 10,00,000/-. This decision was made with the rider that it should not be treated as a precedent. For the cost of improvement, the Tribunal found that the assessee had not proven the cost of construction. Nevertheless, it considered a lump sum disallowance of Rs. 2,14,985/- to be appropriate in the given facts, providing the assessee with relief of Rs. 4,00,000/-. This was also stated to not be a precedent. No other grounds were pressed.
The Tribunal noted that the lower authorities did not properly verify the entities acting as suppliers or purchasers and the corresponding turnovers. While acknowledging that the assessee did not fully satisfy the authorities, the Tribunal found that the "bogus" transactions were reduced from the admitted turnover. In the interest of justice, the Tribunal decided to estimate a lump sum GP at 1.5% of the assessee's alleged fictitious sales and debit entries for all assessment years.
The Tribunal noted that the lower authorities did not properly verify the entities acting as suppliers or purchasers and the corresponding turnovers. While acknowledging that the assessee did not fully satisfy the authorities, the Tribunal found that the "bogus" transactions were reduced from the admitted turnover. In the interest of justice, the Tribunal decided to estimate a lump sum GP at 1.5% of the assessee's alleged fictitious sales and debit entries for all assessment years.
The Tribunal held that the Assessing Officer's assessment, conducted under limited scrutiny, was neither erroneous nor prejudicial to the revenue. The PCIT's revision order was deemed to have erred in law and facts.
The Tribunal noted that the lower authorities did not properly verify the entities acting as suppliers or purchasers and the corresponding turnovers. While acknowledging that the assessee did not fully satisfy the authorities, the Tribunal found that the "bogus" transactions were reduced from the admitted turnover. In the interest of justice, the Tribunal decided to estimate a lump sum GP at 1.5% of the assessee's alleged fictitious sales and debit entries for all assessment years.
The Tribunal noted that the lower authorities did not properly verify the entities acting as suppliers or purchasers and the corresponding turnovers. While acknowledging that the assessee did not fully satisfy the authorities, the Tribunal found that the "bogus" transactions were reduced from the admitted turnover. In the interest of justice, the Tribunal decided to estimate a lump sum GP at 1.5% of the assessee's alleged fictitious sales and debit entries for all assessment years.
The Tribunal condoned the delay in filing the appeal, citing the case of Collector Land Acquisition vs. Mst. Katiji & Ors. The Tribunal restored the appeal to the CIT(A)/NFAC for fresh adjudication, emphasizing that technicalities should not obstruct substantial justice.
The CIT(A) noted that the notice under Section 153C was issued on 15.11.2022. Citing the decision of the Delhi High Court in Ojjus Medicare, the CIT(A) held that the period of six assessment years for Section 153C should be calculated from six years prior to the assessment year in which the seized material was handed over to the AO. As the satisfaction note was recorded on 04.11.2022, the six-year period would be from AY 2017-18 to 2022-23. Therefore, the notice and subsequent assessment order for AY 2014-15 were beyond the permissible period and annulled.
The CIT(A) deleted the additions, holding that the assessee had sufficiently explained the transactions and sources of funds with supporting documents. The Tribunal agreed with the CIT(A) that the evidence provided by the assessee demonstrated the genuineness of the transactions and the sources of funds.
The Tribunal noted that the lower authorities did not properly verify the entities acting as suppliers or purchasers and the corresponding turnovers. While acknowledging that the assessee did not fully satisfy the authorities, the Tribunal found that the "bogus" transactions were reduced from the admitted turnover. In the interest of justice, the Tribunal decided to estimate a lump sum GP at 1.5% of the assessee's alleged fictitious sales and debit entries for all assessment years.
The tribunal noted that the approval for reopening was granted by the prescribed authority in a mechanical manner, simply stating "Yes, I am satisfied". Citing the Supreme Court case of CIT vs. S. Goyanka Lime and Chemical Ltd. (2023) 453 ITR 242 (SC), the tribunal held that such a mechanical approval vitiates the entire reopening process.
The Tribunal acknowledged the divergent views on similar issues in various judicial precedents. Considering the peculiar facts and in the interest of justice, a lump sum disallowance of 5% of the alleged bogus purchases was deemed appropriate.
The Tribunal noted that the lower authorities did not properly verify the entities acting as suppliers or purchasers and the corresponding turnovers. While acknowledging that the assessee did not fully satisfy the authorities, the Tribunal found that the "bogus" transactions were reduced from the admitted turnover. In the interest of justice, the Tribunal decided to estimate a lump sum GP at 1.5% of the assessee's alleged fictitious sales and debit entries for all assessment years.
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 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 assessee's sole substantive ground had merit. It found that the lower authorities had erred in disallowing the impugned salary expenses. The Tribunal reasoned that the applicability of section 192 of the Act is triggered when salary has accrued and has been actually paid. The assessee had correctly pointed out that the TDS was liable to be deducted only on the actual salary paid, which amounted to Rs. 21,39,840/-. Therefore, the disallowance made under section 40A(ia) was deleted. The ratio decidendi is that the disallowance under section 40A(ia) for non-deduction of TDS on salary should be limited to the amount on which TDS was actually deductible based on payment, not on the entire amount claimed as salary if actual payment is lower. The appeal was allowed in terms of this finding.
The Tribunal noted that the lower authorities did not properly verify the entities acting as suppliers or purchasers and the corresponding turnovers. While acknowledging that the assessee did not fully satisfy the authorities, the Tribunal found that the "bogus" transactions were reduced from the admitted turnover. In the interest of justice, the Tribunal decided to estimate a lump sum GP at 1.5% of the assessee's alleged fictitious sales and debit entries for all assessment years.
The Tribunal held that 20% of the unsubstantiated expense claimed on account of building materials and 20% of the travelling expense should be disallowed. Regarding the unsecured loans, the Tribunal found that the assessee had provided documentary evidence, including ITRs and bank statements, and that the lenders had confirmed the transactions. The Tribunal also noted that the 'source of source' rule was not applicable for the impugned assessment year.
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 noted that the assessee failed to appear before the First Appellate Authority despite multiple notices and did not provide necessary details or corroborative evidence. The Tribunal also observed that a ground regarding the absence of approval under Section 153D was raised before them but not effectively before the CIT(A).