ITAT Jaipur Judgments — September 2019

SHRI ARUN KALA,JAIPUR vs DEPUTY COMMISSIONER OF INCOME TAX, CENTARAL CIRCLE-2, JAIPUR

ITA 1218/JPR/2018[2011-12]Status: Disposed30 Sept 2019AY 2011-12Allowed

The Tribunal held that since no incriminating material was found during the search and the assessee had a bonafide belief regarding the taxability of the FDR interest, the penalty under Section 271(1)(c) was not justified. The suo moto declaration of income did not amount to concealment or furnishing inaccurate particulars.

SHRI ARUN KALA,JAIPUR vs DEPUTY COMMISSIONER OF INCOME TAX, CENTARAL CIRCLE-2, JAIPUR

ITA 1217/JPR/2018[2010-11]Status: Disposed30 Sept 2019AY 2010-11Allowed

The Tribunal held that since no incriminating material was found during the search and the assessee had a bonafide belief regarding the taxability of the FDR interest, the penalty under Section 271(1)(c) was not justified. The suo moto declaration of income did not amount to concealment or furnishing inaccurate particulars.

SHRI ARUN KALA,JAIPUR vs DEPUTY COMMISSIONER OF INCOME TAX, CENTARAL CIRCLE-2, JAIPUR

ITA 1215/JPR/2018[2008-09]Status: Disposed30 Sept 2019AY 2008-09Allowed

The Tribunal held that since no incriminating material was found during the search and the assessee had a bonafide belief regarding the taxability of the FDR interest, the penalty under Section 271(1)(c) was not justified. The suo moto declaration of income did not amount to concealment or furnishing inaccurate particulars.

SHRI ARUN KALA,JAIPUR vs DEPUTY COMMISSIONER OF INCOME TAX, CENTARAL CIRCLE-2, JAIPUR

ITA 1214/JPR/2018[2007-08]Status: Disposed30 Sept 2019AY 2007-08Allowed

The Tribunal held that since no incriminating material was found during the search and the assessee had a bonafide belief regarding the taxability of the FDR interest, the penalty under Section 271(1)(c) was not justified. The suo moto declaration of income did not amount to concealment or furnishing inaccurate particulars.

SHRI ARUN KALA,JAIPUR vs DEPUTY COMMISSIONER OF INCOME TAX, CENTARAL CIRCLE-2, JAIPUR

ITA 1216/JPR/2018[2009-10]Status: Disposed30 Sept 2019AY 2009-10Allowed

The Tribunal held that since no incriminating material was found during the search and the assessee had a bonafide belief regarding the taxability of the FDR interest, the penalty under Section 271(1)(c) was not justified. The suo moto declaration of income did not amount to concealment or furnishing inaccurate particulars.

OM PRAKASH AGARWAL,JAIPUR vs ACIT, JAIPUR

ITA 65/JPR/2017[2006-07]Status: Disposed30 Sept 2019AY 2006-07Allowed

The Tribunal held that the omission was a bonafide and inadvertent mistake, not a willful suppression of income. Given that the entire receipt was subject to TDS and the amount was a small percentage of total receipts, it could not be considered concealment of income.

SHRI RAKESH KUMAR JAIN,KOTA vs DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, KOTA

ITA 1032/JPR/2018[2011-12]Status: Disposed30 Sept 2019AY 2011-12Allowed

The Tribunal held that additions under Section 153A cannot be made in the absence of incriminating material when the original assessment was already completed and had not abated. The agricultural income declared by the assessee in the original return should not be added.

MOHAN LAL SWARANKAR,JAIPUR vs ACIT, JAIPUR

ITA 144/JPR/2017[2002-03]Status: Disposed30 Sept 2019AY 2002-03Allowed

The Tribunal held that the addition was not a case of bogus or false claim but due to non-response to notices and lack of satisfactory explanation. The repayment of a significant portion of the loan in the subsequent year further supported the assessee's case.

SHRI RAKESH KUMAR JAIN,KOTA vs DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, KOTA

ITA 1031/JPR/2018[2010-11]Status: Disposed30 Sept 2019AY 2010-11Allowed

The Tribunal held that additions under Section 153A cannot be made in the absence of incriminating material when the original assessment was already completed and had not abated. The agricultural income declared by the assessee in the original return should not be added.

SHRI ARUN KALA,JAIPUR vs DEPUTY COMMISSIONER OF INCOME TAX, CENTARAL CIRCLE-2, JAIPUR

ITA 1219/JPR/2018[2012-13]Status: Disposed30 Sept 2019AY 2012-13Allowed

The Tribunal held that since no incriminating material was found during the search and the assessee had a bonafide belief regarding the taxability of the FDR interest, the penalty under Section 271(1)(c) was not justified. The suo moto declaration of income did not amount to concealment or furnishing inaccurate particulars.

SHRI GYARSI LAL CHOUDHARY,SIKAR vs INCOME TAX OFFICER, WARD, NEEM KA THANA

ITA 991/JPR/2018[2013-14]Status: Disposed27 Sept 2019AY 2013-14Allowed

The Tribunal held that the assessee's explanation of old age and illness causing the delay in filing the audit report was reasonable and bonafide. Therefore, the penalty was deleted in view of Section 273B.

GOYAL SALT PVT. LTD.,JAIPUR vs INCOME TAX OFFICER, WARD-6-2, JAIPUR

ITA 1354/JPR/2018[2012-13]Status: Disposed27 Sept 2019AY 2012-13Allowed

The Tribunal held that the show cause notice for penalty was issued in a routine manner without specifying the limb of Section 271(1)(c) under which the penalty was proposed. Furthermore, the Tribunal found that the additions confirmed were in the nature of cash credits where identity and genuineness were not disputed, and explanations were found inadequate but not false, thus not necessitating a penalty.

SHRI RAHUL BHANDARI,JAIPUR vs INCOME TAX OFFICER, WARD-6(2), JAIPUR

ITA 746/JPR/2018[2013-14]Status: Disposed27 Sept 2019AY 2013-14Dismissed

The Tribunal held that the reopening of assessment was valid as the AO had a prima facie belief based on inquiry and physical verification. The Tribunal also found that the land was sold for non-agricultural purposes and the distance from municipal limits should be measured to the area, not the specific plot, thus it was a capital asset.

M/S TRIANGLE ENGINEERS PVT. LTD.,JAIPUR vs DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-2, JAIPUR

ITA 374/JPR/2019[2009-10]Status: Disposed27 Sept 2019AY 2009-10Allowed

The ITAT found that the CIT(A) dismissed the appeal unilaterally without considering the merits. To ensure equity and justice, the assessee was granted one more opportunity to contest the appeal.

M/S. SINGHANIA LUNIVERSITY,JHUNJHUNU DISTRICT vs ASSISTANT COMMISSIONER OF INCOME TAX, EXEMPTION, JAIPUR

ITA 483/JPR/2019[2014-15]Status: Disposed27 Sept 2019AY 2014-15Remanded

The Tribunal noted that the assessee claimed notices were never served. The CIT(A) passed an ex-parte order without ensuring proper service of notices, which is a procedural lapse.

M/S CHEMICALS INDIA,KOTA vs JOINT COMMISSIONER OF INCOME TAX, KOTA

ITA 92/JPR/2018[2010-11]Status: Disposed27 Sept 2019AY 2010-11Partly Allowed

The Tribunal held that once the AO rejected the books of account under Section 145(3), the assessment should be on a best judgment basis, not by making specific disallowances. Since the assessee's declared GP was better than the preceding years, no addition was warranted.

SHRI SOHAN NATH,AJMER vs INCOME TAX OFFICER, AJMER

ITA 8/JPR/2018[2013-14]Status: Disposed25 Sept 2019AY 2013-14Partly Allowed

The Tribunal held that the AO's estimation of income from liquor business at 8% NP rate was not justified and restricted it to 6%. The addition on account of differential agricultural income was upheld. For truck hiring business, the income was estimated as per Section 44AE at Rs. 3,00,000/-.

SHRI YASH BHATIA,KOTA vs DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, KOTA

ITA 1034/JPR/2018[2010-11]Status: Disposed25 Sept 2019AY 2010-11Allowed

The Tribunal held that additions under Section 153A are only permissible if incriminating material is found during the search, especially when the original assessment was completed. The additions made for FDR interest and opening cash balance were also found to be factually incorrect.

VINOD KUMAR SHARMA,JAIPUR vs ITO, TONK

ITA 86/JPR/2017[2010-11]Status: Disposed23 Sept 2019AY 2010-11Remanded

The Tribunal set aside the orders of the CIT(A) to grant the assessee one more opportunity to present their case. The appeals were to be heard and decided together.

SHRI JOGENDRA SINGH VILL-KUNDALI, DIST-SIKAR,SIKAR vs ADDL. CIT RANGE, SIKAR, SIKAR

ITA 878/JPR/2019[2011-12]Status: Disposed23 Sept 2019AY 2011-12Allowed

The Tribunal held that the assessee had shown a reasonable cause for the cash transactions under Section 273B of the IT Act. The penalties under Section 271D and 271E were not leviable as the transactions were with close relatives and no prejudice was caused to the revenue.

SHRI VINOD KUMAR 31 A GOVIND VATIKA, LAXMAN DOONGRI JAIPUR C/O O.P. AGRAWAL, CA H-8, CHITRANJAN MARG, C-SCHEME, JAIPUR,JAIPUR vs INCOME TAX OFFICER WARD-7(3) JAIPUR, WARD-7(3) JAIPUR

ITA 281/JPR/2019[2010-11]Status: Disposed23 Sept 2019AY 2010-11Remanded

The Tribunal set aside the orders of the CIT(A) to grant the assessee one more opportunity to present their case. The appeals were to be heard and decided together.

SHRI JOGENDRA SINGH VILL-KUNDALI, DIST-SIKAR,SIKAR vs ADDL. CIT RANGE, SIKAR, SIKAR

ITA 879/JPR/2019[2011-12]Status: Disposed23 Sept 2019AY 2011-12Allowed

The Tribunal held that the assessee had shown a reasonable cause for the cash transactions under Section 273B of the IT Act. The penalties under Section 271D and 271E were not leviable as the transactions were with close relatives and no prejudice was caused to the revenue.

KARAN SHANTI COLD STORAGE PVT. LTD.,JAIPUR vs ACIT, BHARATPUR

ITA 223/JPR/2017[2011-12]Status: Disposed23 Sept 2019AY 2011-12Allowed

The Tribunal held that client code modification is a regular business practice for rectifying errors, and in the absence of proof of common intention or malafide intent by the assessee, the addition made by the AO is not sustainable. The loss claimed was found to be negligible compared to the total trading volume.

SMT. VIMLA GUPTA,AJMER vs INCOME TAX OFFICER, AJMER

ITA 922/JPR/2017[2014-15]Status: Disposed23 Sept 2019AY 2014-15Partly Allowed

The Tribunal held that the interest paid on the loan against FDR was incurred to preserve the interest income earned from the FDR. Similarly, the interest claimed against the loan from Shri Kumar Agneet was limited to the interest income received, making the disallowance of the difference unjustified.

SHRI SHRIKISHAN CHOUDHARY,KISHANGARH vs INCOME TAX OFFICER, WARD-1, KISHANGARH

ITA 1065/JPR/2018[2015-16]Status: Disposed23 Sept 2019AY 2015-16Remanded

The Tribunal held that the CIT(A) dismissed the appeal without deciding on merits due to a delay in filing. Considering the assessee's illiteracy and the interest of justice, the matter was set aside to the CIT(A) for a fresh decision.

SLGK CERA INDIA PRIVATE LIMITED,JAIPUR vs ITO, JAIPUR

ITA 259/JPR/2017[2007-08]Status: Disposed23 Sept 2019AY 2007-08Allowed

The Tribunal held that the addition made by the AO and sustained by the CIT(Appeals) was unsustainable in law and liable to be deleted. The Tribunal noted that while the amount was received through banking channels and reflected in bank accounts, the AO's doubt was based on the admission of Shri Praveen Kumar Jain during a search. Crucially, the assessee had repeatedly demanded cross-examination of Shri Praveen Kumar Jain and other individuals whose statements were relied upon by the AO and the Investigation Wing. This opportunity was denied by both the AO and the CIT(Appeals), despite the assessee being ready to bear the cost. The Tribunal relied on the principle that statements recorded behind the assessee's back cannot be used against it without an opportunity for cross-examination, citing the Hon'ble Supreme Court's decision in C. Vasantlal & Co. (supra) which, in this context, supported the assessee's case. The Tribunal found a clear violation of the principles of natural justice. Furthermore, the AO did not bring any material on record to show that the assessee's own unaccounted money was brought back as share capital or that the chain of transactions was established. Therefore, the addition made solely on suspicion and un-cross-examined statements was deleted.

SHRI CHAND KHAN PHADAN,JAIPUR vs INCOME TAX OFFICER, WARD -3(5), JAIPUR

ITA 380/JPR/2018[2009-10]Status: Disposed23 Sept 2019AY 2009-10Allowed

The Tribunal held that the reassessment proceedings were invalid due to the lack of jurisdiction of the AO who issued the notice. Consequently, the additions made by the AO were also set aside.

SHIV PRAKASH BAJAJ,BHILWARA vs DEPUTY COMMISSIONER OF INCOME TAX, AJMER

ITA 368/JPR/2018[2013-14]Status: Disposed23 Sept 2019AY 2013-14Allowed

The Tribunal held that the addition made by the Assessing Officer was not justified as the documents clearly indicated a loan transaction between two independent parties, and the assessee was merely a broker. The Tribunal noted that the assessee had already offered brokerage income as part of his surrendered income.

SHRI GANESH GOYAL,KISHANGARH vs ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, AJMER

ITA 682/JPR/2018[2008-09]Status: Disposed20 Sept 2019AY 2008-09Remanded

The Tribunal noted that the CIT(A) had allowed the assessee to file proof before the AO while passing the appeal effect order, but the AO did not consider this. Therefore, the matter was set aside to the AO for fresh decision after verification of proof.

SHRI GANESH GOYAL,KISHANGARH vs ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, AJMER

ITA 683/JPR/2018[2009-10]Status: Disposed20 Sept 2019AY 2009-10Remanded

The Tribunal noted that the CIT(A) had allowed the assessee to file proof before the AO while passing the appeal effect order, but the AO did not consider this. Therefore, the matter was set aside to the AO for fresh decision after verification of proof.

SHRI RAVI PRAKASH SAINI,JAIPUR vs INCOME TAX OFFICER, WARD-4-3, JAIPUR

ITA 675/JPR/2018[2009-10]Status: Disposed19 Sept 2019AY 2009-10Allowed

The Tribunal held that since a substantial part of the consideration was received on the date of the agreement, the stamp duty valuation on the date of the agreement should be considered for computing full value of consideration under Section 50C. The amendment to Section 50C by the Finance Act, 2016, with its proviso, was considered remedial.

SMT. SAROJ DEVI CHODHARY,JAIPUR vs INCOME TAX OFFICER, JAIPUR

ITA 1031/JPR/2017[2011-12]Status: Disposed19 Sept 2019AY 2011-12Allowed

The Tribunal held that since the CIT(A) had not adjudicated the matter on merits, the assessee should be granted one more opportunity to present her case. The matter was set aside to the CIT(A) for fresh adjudication on merits.

SWASTIKA AUTOMOBILES,JAIPUR vs INCOME TAX OFFICER, JAIPUR

ITA 852/JPR/2017[2013-14]Status: Disposed19 Sept 2019AY 2013-14Dismissed

The Tribunal held that the provisions of Section 40(b) of the Act are applicable as they existed for the assessment year under consideration, regardless of the partnership deed's execution date. Therefore, the amended provisions, not the unamended ones, govern the allowability of partner remuneration.

M/S. RAMBILAS SHIVKUMAR,KEKRI, AJMER vs INCOME TAX OFFICER, WARD-2(3), AJMER

ITA 381/JPR/2018[2013-14]Status: Disposed19 Sept 2019AY 2013-14Remanded

The Tribunal held that the disallowance of interest cannot be made at a flat rate of 18% without considering the actual cost of borrowing. It also noted that certain advances were indeed interest-bearing and should be excluded from the disallowance calculation.

M/S KUMAR & BROTHERS,DHOLPUR vs INCOME TAX OFFICER, WARD-4, BHARATPUR

ITA 656/JPR/2018[2014-15]Status: Disposed19 Sept 2019AY 2014-15Allowed

The Tribunal held that an ad hoc disallowance is not justified merely because some expenses lack proper vouchers, especially when the expenditure is essential for business and not found to be excessive or bogus. The AO's action of making an ad hoc disallowance without invoking Section 145(3) was deemed unjustified.

SHRI RAM RATAN JOSHI,JAIPUR vs ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-4, JAIPUR

ITA 668/JPR/2018[2013-14]Status: Disposed19 Sept 2019AY 2013-14Partly Allowed

The Tribunal held that commission paid to Shri Deepak Kumar Tripathi, Shri Vikash Pandey, and Mohd. Danish Hussain were allowable business expenses as their services were established. However, commission paid to Ms. Preeti Tripathi, Ms. Pushpa Tripathi, and Deepak Kumar Tripathi (HUF) was disallowed as these appeared to be inflated expenditures without genuine services rendered.

GENUS INNOVATION LIMITED,JAIPUR vs DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-2, JAIPUR

ITA 824/JPR/2018[2011-12]Status: Disposed19 Sept 2019AY 2011-12Allowed

The Tribunal held that the claim for advance VAT was a bonafide and allowable claim, even if disallowed by the AO. Therefore, it did not amount to furnishing inaccurate particulars or concealment of income, and the penalty was not attracted.

SHRI RAMESHWAR LAL KUMAWAT,JAIPUR vs INCOME TAX OFFICER, WARD-2(5), JAIPUR

ITA 856/JPR/2018[2013-14]Status: Disposed19 Sept 2019AY 2013-14Partly Allowed

The ITAT upheld the CIT(A)'s disallowance of expenses and agricultural income due to lack of evidence. However, the disallowance of deduction under Section 24(a) was set aside for reconsideration by the AO, as it might be a standard deduction not requiring evidence.

SHRI AJIT SINGH MEENA C/O- KALANI & CO. CA, 5TH FLOOR, MILESTONE BUILDING, GANDHINAGAR TURN, TONK ROAD, JAIPUR,JAIPUR vs ITO WARD-DAUSA, WARD-DAUSA

ITA 785/JPR/2019[2010-11]Status: Disposed19 Sept 2019AY 2010-11Allowed

The Tribunal held that the assessee's claim of agricultural income was reasonable given the land holdings and that savings from agricultural income over the years could not be disputed. Therefore, the addition sustained by the CIT(A) was deleted.

SUMAN KATTA,JAIPUR vs DCIT, JAIPUR

ITA 441/JPR/2018[2013-14]Status: Disposed19 Sept 2019AY 2013-14Dismissed

The Tribunal noted that the assessee did not want to press the appeal. The revenue's counsel had no objection to this submission.

BHAGWAN SAHAI,JAIPUR vs ITO, JAIPUR

ITA 51/JPR/2017[2006-07]Status: Disposed17 Sept 2019AY 2006-07Allowed

The Tribunal held that the reassessment proceedings initiated and the order passed by the ITO Ward 7(2), Jaipur, were bad in law for want of jurisdiction, as the original return was filed and processed by ITO Ward-1, Hanumangarh, and no jurisdiction transfer order was in place. Therefore, the reassessment order was quashed.

PARMINDER KAUR BEDI,PUNJAB vs ITO, KOTA

ITA 96/JPR/2017[2008-09]Status: Disposed17 Sept 2019AY 2008-09Allowed

The Tribunal held that the assessee's reduction of income due to inadvertent double taxation was a rectification of a bonafide mistake, not a claim for benefit. The Tribunal also allowed the deduction under Section 54, finding that the assessee had explained the source of funds and that construction was completed within the permissible period.

M/S JLC ELECTROMET PVT. LTD.,JAIPUR vs ASSISTANAT COMMISSIONER OF INCOME TAX, CIRCLE-4, JAIPUR

ITA 1494/JPR/2018[2013-14]Status: Disposed4 Sept 2019AY 2013-14Allowed

The Tribunal held that since the payments were for services rendered outside India and made outside India, they were not chargeable to tax in India. Therefore, there was no liability to deduct TDS under Section 195(1), and the disallowance under Section 40(a)(ia) was not sustainable.

BHAGWAN SINGH POSWAL,JAIPUR vs ITO, JAIPUR

ITA 190/JPR/2014[2009-10]Status: Disposed4 Sept 2019AY 2009-10Partly Allowed

The Tribunal held that the protective addition in the assessee's hands was not sustainable as the substantive addition was confirmed in the hands of another person. The issue of unexplained investment under Section 69 was remanded to the AO for verification. The disallowance of deduction under Section 80C was upheld due to lack of evidence.

ITO, JAIPUR vs BHAGWAN SINGH POSWAL, JAIPUR

ITA 105/JPR/2014[2009-10]Status: Disposed4 Sept 2019AY 2009-10Partly Allowed

The Tribunal held that the protective addition in the assessee's hands was not sustainable as the substantive addition was confirmed in the hands of another person. The issue of unexplained investment under Section 69 was remanded to the AO for verification. The disallowance of deduction under Section 80C was upheld due to lack of evidence.

UTTAM BHARAT ELECTRICALS PVT. LTD.,JAIPUR vs DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-4, JAIPUR

ITA 710/JPR/2019[2014-15]Status: Disposed4 Sept 2019AY 2014-15Allowed

The Tribunal held that the Internal CUP method should be preferred over the External CUP method for benchmarking interest paid to related parties. It also held that employee contributions to PF and ESI paid before the due date of filing the return are allowable as a deduction.

MS SURBHI AGRAWAL,JAIPUR vs PCIT-2, JAIPUR, JAIPUR

ITA 649/JPR/2019[2014-15]Status: Disposed4 Sept 2019AY 2014-15Partly Allowed

The Tribunal held that while the PCIT's jurisdiction under Section 263 was validly invoked due to lack of inquiry by the AO, the matter needed to be re-examined. The AO was directed to verify the assessee's explanations regarding Section 40A(3) and the Section 80C deduction.

INCOME TAX OFFICER, WARD-5-2, JAIPUR vs M/S KRISHNA VILLA APARTMENTS, THROUGH PARTNER SHRI ARUN BANSAL, JAIPUR

ITA 704/JPR/2019[2007-08]Status: Disposed3 Sept 2019AY 2007-08Dismissed

The Tribunal held that since the revision order under Section 263 was quashed by the Hon'ble Jurisdictional High Court, the consequential assessment order passed by the AO would not survive. Therefore, the revenue's appeal lacked merit.

M/S. ADARSH GHANYODYA VIKAS SAMITI,TONK vs DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-7, JAIPUR

ITA 135/JPR/2019[2011-12]Status: Disposed2 Sept 2019AY 2011-12Allowed

The Tribunal condoned the delay in filing appeals before the CIT(A) due to the assessee's explanation of non-receipt of notices. The ex-parte assessment order and consequential penalty orders were set aside for fresh adjudication.

M/S JAI AMARNATH ASSOCIATES,JAIPUR vs DEPUTY COMMISSIONER OF INCOME TAX, CIRCLL-3, JAIPUR

ITA 1493/JPR/2018[2016-17]Status: Disposed2 Sept 2019AY 2016-17Allowed

The Tribunal held that the cash found at the sister concern's premises did not belong to the assessee, and the assessee had discharged its onus by explaining the source of the cash. The AO failed to discharge the preliminary onus to prove the cash belonged to the assessee.