ITAT Hyderabad Judgments — September 2021

DECCAN HEALTH CARE PRIVATE LIMITED,HYDERABAD vs ASST, COMMISSIONER OF INCOME TAX, CIRCLE-17(1), HYDERABAD

ITA 1302/HYD/2017[2012-13]Status: Disposed27 Sept 2021AY 2012-13Partly Allowed

The tribunal restored the issue of R&D disallowance to the Assessing Officer for fresh verification, directing the assessee to provide documentary evidence. For advertisement and publicity expenses, the tribunal allowed a lump-sum estimation of 6% of the disallowed amount.

TNS INDIA PRIVATE LIMITED, HYD,HYDERABAD vs ACIT, CIRCLE-2(2), HYDERABAD, HYDERABAD

ITA 636/HYD/2016[2011-12]Status: Disposed27 Sept 2021AY 2011-12Partly Allowed

The Tribunal upheld the exclusion of Infosys BPO Ltd., Jeevan Scientific Technology Limited, TCS E-Serve Ltd., Mastiff Technology Pvt. Ltd., and E4e Healthcare Business Services Pvt. Ltd. The assessee's cross-appeal regarding overhead and license fees was restored to the AO, and the disallowance of software license fees for depreciation was allowed in principle.

C & K MANAGEMENT LIMITED,SECUNDERABAD vs INCOME TAX OFFICER, WARD-1(3), HYDERABAD

ITA 1918/HYD/2018[2013-14]Status: Disposed27 Sept 2021AY 2013-14Partly Allowed

The Tribunal allowed the disallowance of PF/ESI payments, holding that payment before the due date of filing the return of income warrants no disallowance. The issue of interest on delayed statutory dues was remitted back to the AO for verification of its nature.

P AMRUTH PRASAD,SECUNDERABAD vs DY. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-1(2), HYDERABAD

ITA 936/HYD/2018[2008/09]Status: Disposed27 Sept 2021Remanded

The Tribunal found that the computation of interest submitted by the assessee required verification. Therefore, the matter was remitted back to the Assessing Officer for de-novo consideration of the interest computation.

SPANDANA SPHOORTY FINANCIAL LTD., HYD,HYDERABAD vs DCIT, CIRCLE-3(2), HYD, HYDERABAD

ITA 990/HYD/2016[2011-12]Status: Disposed27 Sept 2021AY 2011-12Remanded

The Tribunal held that the Pr. CIT was justified in initiating proceedings under Section 263 as the Assessing Officer had not conducted adequate inquiries into the assessee's claim of loss on the assigned portfolio. The assessment order was considered erroneous and prejudicial to the revenue's interest.

DECCAN HEALTH CARE PRIVATE LIMITED,HYDERABAD vs INCOME TAX OFFICER, WARD-17(1), HYDERABAD

ITA 1301/HYD/2017[2011-12]Status: Disposed27 Sept 2021AY 2011-12Partly Allowed

The tribunal restored the issue of R&D disallowance to the Assessing Officer for fresh verification, directing the assessee to provide documentary evidence. For advertisement and publicity expenses, the tribunal allowed a lump-sum estimation of 6% of the disallowed amount.

DCIT, CIRCLE-3(2), HYDERABAD, HYDERABAD vs SPANDANA SPHOORTHY FINANCIAL LTD., HYD, HYDERABAD

ITA 1474/HYD/2016[2011-12]Status: Disposed27 Sept 2021AY 2011-12Remanded

The Tribunal held that the Pr. CIT was justified in invoking Section 263 as the Assessing Officer had not conducted adequate inquiries into the assessee's claim of loss on the assigned portfolio. The Tribunal found that the identity, genuineness, and creditworthiness of the shareholders were not satisfactorily established, suggesting potential issues with share capital infusion.

INCOME TAX OFFICER, WARD-15(4), HYDERABAD vs ARUN KUMAR ETTA, HYDERABAD

ITA 1837/HYD/2017[2012-13]Status: Disposed27 Sept 2021AY 2012-13Dismissed

The Tribunal upheld the CIT(A)'s deletion of the penalty. This was because the penalty show cause notice failed to specify whether the assessee had concealed income or furnished inaccurate particulars.

TMI E2E ACADEMY PRIVATE LIMITED,HYDERABAD vs INCOME TAX OFFICER, WARD-2(4), HYDERABAD

ITA 1879/HYD/2018[2014-15]Status: Disposed27 Sept 2021AY 2014-15Partly Allowed

The Tribunal held that professional tax paid after the due date but before filing the return of income is allowable as a deduction, following a High Court decision. The issue of interest on TDS was remitted to the CIT(A) for fresh adjudication.

ASST. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-3(2), HYDERABAD vs INDRANI PRASAD, NEW DELHI

ITA 152/HYD/2020[2009-10]Status: Disposed27 Sept 2021AY 2009-10Dismissed

The Tribunal upheld the CIT(A)'s action of treating the assessment as non est. The Tribunal noted that the impugned assessment was nullified as the prior ITAT order reversing the revision direction remained in effect.

K.B.ROLLING MILLS PRIVATE LIMITED,RANGA REDDY vs ASST. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-3(1), HYDERABAD

ITA 396/HYD/2020[2010-11]Status: Disposed24 Sept 2021AY 2010-11Allowed

The Tribunal held that Section 153A assessments are unsustainable in the absence of any incriminating material found during the search. Additions for suppressed turnover, Section 40A(3) disallowances, and Section 68 cash credits were deleted due to lack of supporting evidence and reliance on uncorroborated statements.

K.B.ROLLING MILLS PRIVATE LIMITED,RANGA REDDY vs ASST. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-3(1), HYDERABAD

ITA 400/HYD/2020[2014-15]Status: Disposed24 Sept 2021AY 2014-15Allowed

The Tribunal held that Section 153A assessments are unsustainable in the absence of any incriminating material found during the search. Additions for suppressed turnover, Section 40A(3) disallowances, and Section 68 cash credits were deleted due to lack of supporting evidence and reliance on uncorroborated statements.

K.B.ROLLING MILLS PRIVATE LIMITED,RANGA REDDY vs ASST. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-3(1), HYDERABAD

ITA 399/HYD/2020[2013-14]Status: Disposed24 Sept 2021AY 2013-14Allowed

The Tribunal held that Section 153A assessments are unsustainable in the absence of any incriminating material found during the search. Additions for suppressed turnover, Section 40A(3) disallowances, and Section 68 cash credits were deleted due to lack of supporting evidence and reliance on uncorroborated statements.

ASIP PRIVATE LIMITED,HYDERABAD vs DY. COMMISSIONER OF INCOME TAX, CIRCLE-1(1), HYDERABAD

ITA 1869/HYD/2018[2013-14]Status: Disposed24 Sept 2021AY 2013-14Remanded

The Tribunal noted that the issue of deemed dividend applicability in cases with common shareholders is under consideration by the Supreme Court. Therefore, the matter was restored to the Assessing Officer for fresh adjudication after the Supreme Court's decision.

GOKUL PRASAD PATEL,HYDERABAD vs INCOME TAX OFFICER, WARD-13(3), HYDERABAD

ITA 2230/HYD/2018[2004-05]Status: Disposed24 Sept 2021AY 2004-05Remanded

The Tribunal found that the assessee's grounds raised a clinching question regarding the validity of the transfer and the assessment of capital gains in a later year. This required fresh factual verification.

K.B.ROLLING MILLS PRIVATE LIMITED,RANGA REDDY vs ASST. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-3(1), HYDERABAD

ITA 402/HYD/2020[2016-17]Status: Disposed24 Sept 2021AY 2016-17Allowed

The Tribunal held that Section 153A assessments are unsustainable in the absence of any incriminating material found during the search. Additions for suppressed turnover, Section 40A(3) disallowances, and Section 68 cash credits were deleted due to lack of supporting evidence and reliance on uncorroborated statements.

K.B.ROLLING MILLS PRIVATE LIMITED,RANGA REDDY vs ASST. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-3(1), HYDERABAD

ITA 398/HYD/2020[2012-13]Status: Disposed24 Sept 2021AY 2012-13Allowed

The Tribunal held that Section 153A assessments are unsustainable in the absence of any incriminating material found during the search. Additions for suppressed turnover, Section 40A(3) disallowances, and Section 68 cash credits were deleted due to lack of supporting evidence and reliance on uncorroborated statements.

K.B.ROLLING MILLS PRIVATE LIMITED,RANGA REDDY vs ASST. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-3(1), HYDERABAD

ITA 401/HYD/2020[2015-16]Status: Disposed24 Sept 2021AY 2015-16Allowed

The Tribunal held that Section 153A assessments are unsustainable in the absence of any incriminating material found during the search. Additions for suppressed turnover, Section 40A(3) disallowances, and Section 68 cash credits were deleted due to lack of supporting evidence and reliance on uncorroborated statements.

K.B.ROLLING MILLS PRIVATE LIMITED,HYDERABAD vs ASST. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-3(1), HYDERABAD

ITA 397/HYD/2020[2011-12]Status: Disposed24 Sept 2021AY 2011-12Allowed

The Tribunal held that Section 153A assessments are unsustainable in the absence of any incriminating material found during the search. Additions for suppressed turnover, Section 40A(3) disallowances, and Section 68 cash credits were deleted due to lack of supporting evidence and reliance on uncorroborated statements.

ZUARI CEMENT LIMITED,KADAPA vs ASST. COMMISSIONER OF INCOME TAX, CIRCLE-1(1), KADAPA

ITA 181/HYD/2018[2009-10]Status: Disposed24 Sept 2021AY 2009-10Allowed

The Tribunal found that the TPO's analysis was based on wrong presumptions and propositions, and the Dispute Resolution Panel (DRP) had not properly considered the assessee's objections. The Tribunal set aside the orders of the TPO/DRP and restored the issue to the AO for fresh consideration.

SPLENDID METAL PRODUCTS LIMITED,HYDERABAD vs ASST. COMMISSIONER OF INCOME TAX, CIRCLE-3(2), HYDERABAD

ITA 1804/HYD/2019[2015-16]Status: Disposed24 Sept 2021AY 2015-16Allowed

The Tribunal found that the assessee had provided all relevant details during the scrutiny assessment. Therefore, the imposition of penalty for non-cooperation was erroneous.

SANZYME BIOLOGICAL PRIVATE LIMITED,HYDERABAD vs DY. COMMISSIONER OF INCOME TAX, CIRCLE-3(1), HYDERABAD

ITA 587/HYD/2020[2019-20]Status: Disposed23 Sept 2021AY 2019-20Allowed

The Tribunal held that the disallowance was not sustainable. This was based on the legislative amendment via the Finance Act, 2021, and a CBDT clarification that these amendments apply prospectively from April 1, 2021.

SOCTRONICS TECHNOLOGIES PRIVATE LIMITED,HYDERABAD vs DY. COMMISSIONER OF INCOME TAX, CIRCLE-3(2), HYDERABAD

ITA 485/HYD/2020[2017-18]Status: Disposed23 Sept 2021AY 2017-18Allowed

The Tribunal held that the disallowance was not sustainable. This was based on legislative amendments to Sections 36(1)(va) and 43B via the Finance Act, 2021, and a CBDT clarification that these amendments apply prospectively from 01-04-2021.

NARESH KUKKALA,SECUNDERABAD vs INCOME TAX OFFICER, WARD-15(1), HYDERABAD

ITA 1458/HYD/2019[2014-15]Status: Disposed23 Sept 2021AY 2014-15Withdrawn

The Tribunal held that since Form(s)-3 under the Vivad Se Viswas scheme had already been issued, there was no purpose in keeping the appeal pending. The appeal was dismissed as withdrawn.

PROGRESS SOFTWARE DEVELOPMENT PRIVATE LIMITED,HYDERABAD vs DY. COMMISSIONER OF INCOME TAX, CIRCLE-16(2), HYDERABAD

ITA 2271/HYD/2017[2013-14]Status: Disposed23 Sept 2021AY 2013-14Remanded

The Tribunal restored the issue of interest on ECBs and trade credits back to the TPO for fresh examination, considering previous years' orders and all other facts. Similarly, the issue of interest on receivables was also restored to the TPO for fresh adjudication.

DY. COMMISSIONER OF INCOME TAX, CIRCLE-2(1), HYDERABAD vs INVENTAA INDUSTRIES PRIVATE LIMITED, HYDERABAD

ITA 580/HYD/2020[2017-18]Status: Disposed23 Sept 2021AY 2017-18Dismissed

The Tribunal upheld the CIT(A)'s finding that income from mushroom production is agricultural income and thus exempt. This decision was based on the principle of judicial consistency with a prior Special Bench ruling on the same issue for the assessee.

ROCKWELL COLLINS (INDIA) ENTERPRISES PRIVATE LIMITED,HYDERABAD vs INCOME TAX OFFICER, WARD-3(2), HYDERABAD

ITA 326/HYD/2020[2010-11]Status: Disposed23 Sept 2021AY 2010-11Allowed

The Tribunal held that the PCIT erred in exercising revisionary jurisdiction. The Tribunal found that Form 56F was indeed part of the records, and the issue of shared services was revenue neutral, supported by Supreme Court judgments and CBDT circulars. Therefore, the reassessment order was restored.

M/S. SYNERGIES CASTINGS LIMITED,HYDERABAD vs ACIT, CIRCLE -3(2), HYDERABAD

ITA 285/HYD/2021[2016-17]Status: Disposed23 Sept 2021AY 2016-17Partly Allowed

The Tribunal held that a corporate guarantee is an international transaction and affirmed the adjustment in principle. However, it reduced the commission rate for the corporate guarantee to 0.875% and deleted the adjustment for interest on receivables.

RISHABH PHENOLICS PRIVATE LIMITED,HYDERABAD vs INCOME TAX OFFICER, WARD-3(2), HYDERABAD

ITA 718/HYD/2020[2013-14]Status: Disposed23 Sept 2021AY 2013-14Remanded

The Tribunal condoned the delay in filing the appeal due to the pandemic. It also restored the matter to the CIT(A) to decide the grounds of appeal on merits after providing the assessee with a reasonable opportunity of being heard.

ASST.COMMISSIONER OF INCOME TAX (EXEMPTIONS), HYDERABAD vs NALGONDA DIOCESE SOCIETY, NALGONDA

ITA 2063/HYD/2017[2011-12]Status: Disposed23 Sept 2021AY 2011-12Dismissed

The Tribunal held that the Assessing Officer's own remand report indicated no violation of the society's objects or the provisions of the Income Tax Act. Therefore, the assessee was eligible for exemption under Section 11.

SANZYME BIOLOGICS PRIVATE LIMITED,HYDERABAD vs DY. COMMISSIONER OF INCOME TAX, CIRCLE-3(1), HYDERABAD

ITA 586/HYD/2020[2018-19]Status: Disposed23 Sept 2021AY 2018-19Allowed

The Tribunal held that the disallowance was not sustainable. This was based on the legislative amendment via the Finance Act, 2021, and a CBDT clarification that these amendments apply prospectively from April 1, 2021.

ACIT, CIRCLE-2(2), HYDERABAD, HYDERABAD vs GREEN FIRE AGRI COMMODITIES LTD., HYD, HYDERABAD

ITA 263/HYD/2015[2010-11]Status: Disposed22 Sept 2021AY 2010-11Dismissed

The Tribunal dismissed the appeal as not maintainable, citing CBDT Circular No. 17/2019 which sets a monetary limit for appeals. The issues raised were left open for future proceedings.

RAVINDAR REDDY PALLE,HYDERABAD vs INCOME TAX OFFICER, WARD-9(4), HYDERABAD

ITA 207/HYD/2020[2016-17]Status: Disposed21 Sept 2021AY 2016-17Remanded

The tribunal held that the lower authorities failed to make a mandatory reference to the DVO as required under the proviso to Section 56(2)(vii) for immovable property transactions. Therefore, the issue needs to be re-adjudicated.

NCOME TAX OFFICER, WARD-3(3), HYDERABAD vs SHYAM BABA FERRO ALLOYS PRIVATE LIMITED, MAHBOOB NAGAR

ITA 2203/HYD/2017[2014-15]Status: Disposed21 Sept 2021AY 2014-15Dismissed

The ITAT upheld the CIT(A)'s decision to reject the assessee's book results due to non-production of convincing explanations and material. The tribunal also agreed with the CIT(A) that classifying the Rs. 4,23,51,491 as speculation income was academic after the loss was ignored.

VIVIMED LIFE SCIENCE PRIVATE LIMITED,HYDERABAD vs DY. COMMISSIONER OF INCOME TAX, CIRCLE-3(1), HYDERABAD

ITA 606/HYD/2020[2018-19]Status: Disposed21 Sept 2021AY 2018-19Allowed

The Tribunal held that the disallowance was not sustainable. It noted that legislative amendments and CBDT clarifications regarding the prospective applicability of such disallowances from April 1, 2021, were in place.

NARENDAR SRI RAM,HYDERABAD vs INCOME TAX OFFICER, WARD-4(1), HYDERABAD

ITA 582/HYD/2020[2009-10]Status: Disposed21 Sept 2021AY 2009-10Remanded

The Tribunal restored the matter to the CIT(A) for fresh consideration. The assessee was given an opportunity to file a condonation petition and appear before the CIT(A).

ASST. COMMISSIONER OF INCOME TAX, CIRCLE-8(1), HYDERABAD vs DELOITTE AND TOUCHE ASSURANCE AND ENTERPRISES RISK SERVICES INDIA PRIVATE LIMITED, HYDERABAD

ITA 503/HYD/2020[2018-19]Status: Disposed21 Sept 2021AY 2018-19Dismissed

The Tribunal held that the disallowance was rightly deleted by the CIT(A) considering the legislative amendments and CBDT's clarification that they are applicable only from April 1, 2021. The amendments distinguish between employer's and employee's contributions.

CAUVERY IRON & STEEL INDIA LIMITED,HYDERABAD vs INCOME TAX OFFICER, WARD-1(3), HYDERABAD

ITA 288/HYD/2020[2011-12]Status: Disposed21 Sept 2021AY 2011-12Allowed

The Tribunal followed its previous order for AY 2009-10, which deleted an identical addition. It held that the Revenue failed to provide evidence linking the investment to the assessee's own funds and that the assessee had discharged its onus. Therefore, the addition was deleted.

DY. COMMISSIONER OF INCOME TAX, CIRCLE-16(2), HYDERABAD vs PLR PROJECTS PRIVATE LIMITED, HYDERABAD

ITA 615/HYD/2019[2013-14]Status: Disposed21 Sept 2021AY 2013-14Dismissed

The Tribunal held that interest on delayed service tax payments is compensatory in nature, not penal. Therefore, it is allowable as a deduction under Section 37 of the Income Tax Act.

DY. COMMISSIONER OF INCOME TAX, CIRCLE-16(1), HYDERABAD vs NAVA BHARAT VENTURES LIMITED, HYDERABAD

ITA 11/HYD/2019[2012-13]Status: Disposed21 Sept 2021AY 2012-13Allowed

The Tribunal held that DEPB benefits, being export incentives, should not be considered for adjustment under Rule 10B as it would override the special provisions of Chapter X of the Income Tax Act. The assessee's argument for inclusion was rejected.

DY. COMMISSIONER OF INCOME TAX, CIRCLE-16(2), HYDERABAD vs MARGADARSI MARKETING PRIVATE LIMITED, HYDERABAD

ITA 813/HYD/2018[2014-15]Status: Disposed21 Sept 2021AY 2014-15Dismissed

The Tribunal upheld the deletion of the deemed dividend addition, following its own previous decisions in identical cases for earlier assessment years. The Tribunal found no distinction in facts or law to deviate from the established precedent.

SHYAM BABA FERRO ALLOYS PRIVATE LIMITED,HYDERABAD vs INCOME TAX OFFICER, WARD-3(3), HYDERABAD

ITA 2059/HYD/2017[2014-15]Status: Disposed21 Sept 2021AY 2014-15Dismissed

The ITAT upheld the CIT(A)'s decision to reject the assessee's book results due to non-production of convincing explanations and material. The tribunal also agreed with the CIT(A) that classifying the Rs. 4,23,51,491 as speculation income was academic after the loss was ignored.

DY. COMMISSIONER OF INCOME TAX, CIRCLE-15(1), HYDERABAD vs MAATHA PROJECTS LLP, HYDERABAD

ITA 2258/HYD/2018[2015-16]Status: Disposed21 Sept 2021AY 2015-16Remanded

The Tribunal found that neither the AO nor the CIT(A) had verified the assessee's claim of advances. Therefore, the issue was remitted back to the AO for re-decision with proper verification of the advances and their subsequent offering to tax.

PRAKASH YADAV CHITTIBOINA,HYDERABAD vs ASST. COMMISSIONER OF INCOME TAX, RANGE-9, HYDERABAD

ITA 127/HYD/2018[2011-12]Status: Disposed20 Sept 2021AY 2011-12Dismissed

The Tribunal upheld the penalty imposed under Section 271D, agreeing with the lower authorities that the assessee failed to establish a reasonable cause for violating Section 269SS by accepting cash loans.

LAKSHYA PHARMA PRIVATE LIMITED, HYDERABAD,HYDERABAD vs ITO, WARD-16(1), HYDERABAD, HYDERABAD

ITA 553/HYD/2017[2012-13]Status: Disposed20 Sept 2021AY 2012-13Remanded

The Tribunal, noting the assessee's inability to produce documentary evidence before lower authorities and its readiness to do so now, remitted the matter back to the CIT(A). The CIT(A) was directed to re-adjudicate the issues after providing the assessee with another opportunity to be heard and present evidence.

SHRISHTI ELECTRICALS PRIVATE LIMITED,HYDERABAD vs DY. COMMISSIONER OF INCOME TAX, CIRCLE-3(1), HYDERABAD

ITA 578/HYD/2020[2018-19]Status: Disposed20 Sept 2021AY 2018-19Allowed

The Tribunal held that the disallowance was not sustainable due to recent legislative amendments and CBDT clarifications which applied prospectively from April 1, 2021. The impugned disallowance was deleted.

FRONTIERS INFRA PROJECTS INDIA PRIVATE,HYDERABAD vs ITO, WARD-17(1), HYDERABAD, HYDERABAD

ITA 744/HYD/2020[2015-16]Status: Disposed20 Sept 2021AY 2015-16Remanded

The Tribunal found that the CIT(A) had not adjudicated the ground relating to interest under Section 220(2) and that the assessee sought an opportunity to present its case with documentary evidence. Therefore, the matter was remitted back to the CIT(A) for fresh consideration.

RATNADEEP RETAIL PRIVATE LIMITED,SECUNDERABAD vs DY. COMMISSIONER OF INCOME TAX, CIRCLE-3(1), HYDERABAD

ITA 607/HYD/2020[2019-20]Status: Disposed20 Sept 2021AY 2019-20Allowed

The Tribunal held that the disallowance was not sustainable. This was based on legislative amendments to Sections 36(1)(va) and 43B of the Act, which were clarified to be applicable only from April 1, 2021, and that the disallowance pertained to employee's contribution under Section 36(va).

ATGC BIOTECH PRIVATE LIMITED,HYDERABAD vs ASST. COMMISSIONER OF INCOME TAX, CIRCLE-1(1), HYDERABAD

ITA 2079/HYD/2018[2015-16]Status: Disposed20 Sept 2021AY 2015-16Remanded

The Tribunal condoned the delay and admitted the appeal. It found that while the assessee failed to adequately justify the share premium, the CIT(A) incorrectly applied the provisions related to unexplained cash credits. The issue was restored to the Assessing Officer for fresh adjudication.

INCOME TAX OFFICER, WARD-1, NELLORE vs ARJUN TRADERS PRIVATE LIMITED, NELLORE

ITA 259/HYD/2020[2009-10]Status: Disposed20 Sept 2021AY 2009-10Remanded

The ITAT found that the CIT(A) had not fully addressed all issues raised by the AO. Therefore, the Tribunal remitted the matter back to the AO for a fresh decision, directing the assessee to provide documentary evidence.