ITAT Jaipur Judgments — April 2017

The Tribunal condoned the delay in filing the appeal. It held that the CIT(A) was not justified in directing the AO to calculate net profit at 57.5% instead of the declared 32.32%, considering the facts and a similar ITAT decision.

The Tribunal held that the penalty order could not be sustained due to contradictions between the assessment and penalty orders and the fact that no search was conducted at the assessee's premises or statement recorded under section 132(4). The CIT(A)'s deletion of the penalty was affirmed.

The Tribunal found that the assessee was not provided with an effective opportunity of being heard. Therefore, all issues were restored to the Assessing Officer for de novo decision after giving adequate opportunity.

The Tribunal held that while the assessee failed to fully explain the sources of capital, certain deductions were admissible. The balance addition of Rs. 9,26,936/- was sustained.

The Tribunal allowed the assessee's appeal on the issue of advance for land sale, following a previous ITAT decision. However, the addition related to opening cash balance was upheld as the assessee failed to provide supporting evidence.

The Tribunal held that once books of account are rejected, specific disallowances should not be made, and only the profit rate should be estimated. Since the declared Net Profit (NP) rate of 9.76% was better than past years and the average NP rate of past years was lower than the declared rate, the additions made were directed to be deleted.

The Tribunal confirmed the order of the CIT(A) by following its own previous decisions for earlier assessment years, which were in favour of the assessee. The Tribunal found no change in the facts or legal position and no contrary authorities were presented by the Revenue.

The Tribunal held that the assessee had substantially proved the source of cash deposits by providing the firm's books of account, capital accounts, and partnership deed. Relying on High Court decisions, the Tribunal found merit in the assessee's contention.

The Tribunal held that exemption under Section 10(5) is strictly for travel within India. Payments made for foreign travel as part of LTC are taxable, and the assessee bank was in default for not deducting TDS.

The Tribunal upheld the disallowance of depreciation on building machinery due to lack of evidence. It also affirmed the CIT(A)'s addition for the unexplained opening cash balance, stating the assessee failed to prove its veracity.

The Tribunal found that the assessee's claim of maintaining books in SAP software and allocating expenses scientifically appeared misleading. Since the income from one area was taxable and the other eligible for deduction, the assessee had an obligation to identify borrowed amounts spent on SEZ and DTA separately.

The Tribunal restored the issue to the AO for fresh inquiry, directing verification of the affidavit and inquiry from parties who deducted tax. If payments are found not to pertain to the assessee, the addition will be deleted.

The Tribunal held that the assessee's practice of deducting TDS at the time of actual payment to individual ABAs, rather than at the time of booking expenses in the pool account, was a plausible view. Following the Supreme Court's decision in Reliance Petroproducts Ltd., mere making of a claim not sustainable in law does not amount to furnishing inaccurate particulars.

The Tribunal upheld the CIT(A)'s order. It agreed that expenses should be allowed against suppressed receipts and that the goodwill receipt was a refundable liability, not taxable income.

The Tribunal dismissed the appeal as not maintainable. The tax effect, including surcharge, was found to be below the Rs. 10 lakh limit set by the CBDT circular for departmental appeals.

The Tribunal held that the sales tax refund should be considered while estimating the Net Profit rate, not separately. It also ruled that interest on FDRs pledged for bank guarantees required for business contracts should be treated as business income, not income from other sources.

The Tribunal affirmed the CIT(A)'s order, holding that the reduction in trading addition was justified due to increased turnover and that the addition on account of ceased liability was incorrect as there was no evidence of the liability ceasing.

The Tribunal held that the Departmental Valuer's report was defective. It found that the valuation adopted CPWD rates instead of State PWD rates and did not allow sufficient deduction for self-supervision. The period of construction considered was also deemed unjustified.

The Tribunal held that the Rs. 35,00,000 investment was made by cheque and not in cash, thus deleting the addition. For the silver articles, the Tribunal sustained the addition of 50% of the value, considering it a reasonable amount for customary gifts.

The Tribunal held that the assessee society is eligible for exemption under Section 11 read with Sections 12 and 13 of the Act. Payments, expenditures, and contributions made by the assessee were considered valid applications of income.

The Tribunal held that the Assessing Officer failed to establish a nexus between borrowed funds and the investments. Following previous decisions in the assessee's own case, the disallowance of interest was deleted.

The Tribunal held that the provision for development expenses was an accrued liability, not a contingent one, as the assessee was contractually obligated to develop the township. Following Supreme Court judgments, the Tribunal upheld the deletion of the addition.

The Tribunal relied on various judicial precedents to hold that the AO cannot reject the assessee's accounts without pointing out specific defects or unreliability. The AO's estimation of sales and application of a higher GP rate was not sustained without proper justification.

The Tribunal, following its own precedent from a prior assessment year with identical facts, directed the Assessing Officer to restrict the addition to Rs. 4 lakhs, aligning with the previous year's assessment.

The Tribunal held that if an assessee has not maintained books of account, the offense under Section 44AA is complete, and a subsequent offense under Section 44AB (failure to get accounts audited) cannot arise. Therefore, the penalty under Section 271B was not leviable.

The Tribunal held that the facts were identical to previous years and no change was pointed out by the Revenue. Following the consistent view of the coordinate benches, the Tribunal affirmed the deletion of the adjustment.

The Tribunal held that the CIT(A) was justified in allowing deduction under Section 80IE for foreign currency fluctuation gain and excess provision written back. The Tribunal followed its own earlier decision in the assessee's own case for AY 2011-12.

The Tribunal held that the ad-hoc trading addition of Rs. 5,00,000 was unjustified and deleted it, dismissing the Revenue's appeal on this ground. The Tribunal noted that similar additions in earlier years were decided in favour of the assessee by coordinate benches. It confirmed the CIT(A)'s findings that the GP rate declared (8.32%) was better than the preceding year (7.16%), the stock register was maintained, and no adverse material was brought on record by the Assessing Officer (AO) to reject the book results. The Tribunal also noted that the CIT(A) had deleted the addition after considering the appellant's submissions and the fact that the GP rate was better than the previous period. The judgment indicates that the grounds of appeal for AYs 2011-12 and 2012-13 were similar to those for AY 2009-10, and the findings for AY 2009-10 would apply mutatis mutandis. The specific findings on the deemed dividend issue and interest disallowance are not detailed in the provided excerpt, but the overall outcome suggests relief for the assessee on these matters as well, leading to the allowance of the assessee's appeals and dismissal of the Revenue's appeals.

The Tribunal, following its own precedent from a prior assessment year with identical facts, directed the Assessing Officer to restrict the addition to Rs. 4 lakhs, aligning with the previous year's assessment.

The Tribunal dismissed the appeal regarding the addition under Section 40A(3) as the assessee failed to demonstrate that the payment fell under the exemptions of Rule 6DD. The Tribunal also upheld the addition on account of advances shown against flat bookings, noting that sales were made in subsequent years.

The Tribunal held that the CIT(A)'s confirmation of an addition of Rs. 5,76,200/- was factually and legally incorrect. It found that the assessee had utilized Rs. 24,42,800/- from the withdrawn amount for land purchases and advances, and there was no material to suggest the assessee retained any commission.

The Tribunal held that the CIT(A) was justified in deleting the addition under Section 68 as the funds were received as financial assistance from a family concern and supported by documentation. The Tribunal also deleted the lump sum trading addition as the Assessing Officer had not rejected the books of account.

The Tribunal found that while the Pr. CIT's action was justified in principle, the Assessing Officer needed to conduct a more thorough inquiry. The Tribunal directed the Assessing Officer to obtain a valuation report from a departmental valuer and verify the cost of construction.

The Tribunal upheld the CIT(A)'s decision to reduce the NP rate to 11% based on the assessee's past history. It also affirmed the CIT(A)'s direction to include FDR interest income in the turnover, finding no contrary material from the Revenue.

The Tribunal held that statements recorded during a survey under Section 133A, without oath, do not have conclusive evidentiary value and cannot be the sole basis for additions. It also found that the disallowance of stipend expenses was unjustified.

The Tribunal held that the CIT(A) was not justified in quashing the assessment order due to a technical defect in serving the notice under Section 143(2), as the assessee had participated in the proceedings. The assessee's cross-objection was allowed for statistical purposes.

The Tribunal held that the pattern of deposits and withdrawals indicated trading activity, not commission income. It applied Section 44AF for estimating income on total deposits and also confirmed an addition of Rs. 3,632/- for insurance commission due to lack of explanation.

The Tribunal held that although the assessee was negligent in appearing before the authorities, the source of the deposit was well-explained by the cash received by his father from the sale of land. Therefore, the penalty was not leviable.

The Tribunal found that no additions were made to other family members for household expenses and no incriminating documents were found during a search. Therefore, the addition was reduced to Rs. 1.00 lac.

The Tribunal directed the assessee to submit details of co-owners' income tax returns and confirmations to the AO. The AO was instructed to provide an adequate opportunity of being heard. The grounds of appeal were allowed for statistical purposes.

The Tribunal held that the reassessment proceedings were justified as the assessee's claim for Section 54F exemption was based on incorrect facts. However, the issue regarding the ownership of the property at Bayana and the consequent eligibility for Section 54F exemption was restored to the Assessing Officer for fresh investigation.

The Tribunal partially sustained the trading addition, reducing it to Rs. 15,000, considering the assessee's past profit rates. However, the ad-hoc disallowance on expenses was deleted, as the Tribunal found no separate disallowance justified after the rejection of books.

The Tribunal confirmed the disallowance of Rs. 1,71,363 under Section 40A(3) due to lack of evidence for reimbursement and necessity of cash payments. However, it deleted the disallowance and enhancement on director's remuneration, finding it justified. The ad hoc disallowance on miscellaneous expenses was also deleted for lack of specific defects.

The Tribunal upheld the rejection of books of account under Section 145(3) due to defects. However, the addition was sustained only to the extent of Rs. 2.00 lacs, providing partial relief to the assessee.

The Tribunal partly allowed the appeal. While upholding the rejection of books of account, it reduced the trading addition. The ad-hoc disallowance on expenses was deleted, and the capital gains exemption claim was remanded to the AO for fresh adjudication.

The Tribunal upheld the deletion of the addition made by the Assessing Officer. It followed a coordinate bench's decision in the assessee's own case for a prior year, finding no distinguishable facts or contrary precedents.

The Tribunal upheld the rejection of books of account but reduced the estimated GP addition. It allowed the deletion of interest disallowance based on the availability of interest-free funds and deleted the ad hoc addition on depreciation. The addition for cessation of liability was also contested.

The Tribunal held that prior to the amendment of Section 200A(1)(c) effective from June 1, 2015, the AO did not have the power to levy fees under Section 234E while processing TDS statements. Therefore, the demand raised was not valid.