ITAT Jaipur Judgments — February 2020

The Tribunal is considering the Revenue's appeal against the deletion of an addition by the CIT(A). The addition was made by the AO after rejecting the assessee's books and treating receipts from customers as income.

The Tribunal held that interest income earned from FDRs with a cooperative bank is eligible for deduction under Section 80P(2)(d) as a cooperative bank is considered a cooperative society. The payment to 'sparsh trust' was also held to be an allowable business expenditure.

The Tribunal held that interest income earned from FDRs with a cooperative bank is eligible for deduction under Section 80P(2)(d) as a cooperative bank is considered a cooperative society. The payment to 'sparsh trust' was also held to be an allowable business expenditure.

The Tribunal upheld the reopening of assessment, finding prima facie material to believe income had escaped assessment. It also sustained the addition made by the Assessing Officer, noting that the addition was less than what would have been made by estimating income based on the assessee's past average gross profit rates.

The Tribunal held that the disallowance for interest payment to NBFCs requires verification by the AO regarding whether the NBFCs included the interest in their income. For PF & ESI contributions, the Tribunal followed jurisdictional High Court and Supreme Court decisions allowing the deduction if paid before the due date of filing the return.

The Tribunal held that the AO had already examined the claim of additional depreciation during the original assessment, making the reassessment a case of change of opinion. The claim for additional depreciation on windmills was allowed, following previous High Court and Tribunal decisions.

The Tribunal held that the AO exceeded his jurisdiction by expanding the scope of limited scrutiny to include unexplained investment in property purchase without obtaining prior approval from the competent authority. Therefore, the assessment order was quashed.

The Tribunal held that the misclassification of shares as listed instead of unlisted was an inadvertent and bona fide mistake by the tax consultant, not an intentional concealment or furnishing of inaccurate particulars. Therefore, penalty under Section 271(1)(c) was not justified.

The Tribunal held that the payments were made to close relatives for genuine family accommodation during emergencies and did not constitute loans or deposits in the strict legal sense. Therefore, the penalty under Section 271E was not leviable.

The Tribunal found no merit in the addition made to the filling station business, considering the declared net profit rate was higher than previously accepted rates. However, for the marble business, an addition of Rs. 1.00 lac was upheld due to shortcomings in maintaining accounts and vouchers.

The Tribunal held that the initiation of penalty proceedings was vitiated due to the absence of recorded satisfaction by the Assessing Officer in the assessment order. Furthermore, the penalty on the unsecured loan addition was deleted as the assessee had provided explanations and confirmations.

The Tribunal held that the CIT(A) erred in dismissing the appeal ex-parte without deciding the issue on merits. The matter was remanded back to the CIT(A) for a fresh decision after granting one more opportunity of hearing to the assessee.

The Tribunal held that jewellery explained by purchase bills and recorded in books of account cannot be treated as part of the reasonable holding under CBDT Instruction No. 1916. Therefore, the addition sustained by the CIT(A) on account of unexplained gold jewellery was deleted.

The Tribunal held that profit from the sale of agricultural land, which is not a capital asset, cannot be included for computing book profit under Section 115JB. The CIT(A)'s order was upheld.

The Tribunal found that the CIT(A) had not adjudicated on the merits of the addition and had dismissed the appeal summarily. Therefore, the Tribunal set aside the CIT(A)'s order and remanded the matter for fresh adjudication.

The Tribunal, considering the interest of justice, granted the assessee one last opportunity to represent its case before the CIT(A). The matter was remanded back to the CIT(A) for a decision on merits.

The Tribunal held that the turnover for speculative transactions should be calculated as the aggregate of positive and negative differences, as per the ICAI Guidance Note. Since the calculated turnover was below the threshold for audit under Section 44AB, penalties under Sections 271A and 271B were deleted. However, the penalty under Section 271(1)(b) for non-compliance with the Section 142(1) notice was confirmed.

The Tribunal held that the AO wrongly converted a case of suppressed sales into unexplained investment. Purchases were accounted for, and at worst, it was a case of suppressed sales, not unaccounted purchases.

The Tribunal held that the turnover for speculative transactions should be calculated as the aggregate of positive and negative differences, as per the ICAI Guidance Note. Since the calculated turnover was below the threshold for audit under Section 44AB, penalties under Sections 271A and 271B were deleted. However, the penalty under Section 271(1)(b) for non-compliance with the Section 142(1) notice was confirmed.

The Tribunal held that the turnover for speculative transactions should be calculated as the aggregate of positive and negative differences, as per the ICAI Guidance Note. Since the calculated turnover was below the threshold for audit under Section 44AB, penalties under Sections 271A and 271B were deleted. However, the penalty under Section 271(1)(b) for non-compliance with the Section 142(1) notice was confirmed.

The Tribunal held that the assessee's institution solely exists for educational purposes and all its objects are related to education without any profit motive. Income from building rent and exam fees was considered incidental to educational activities and did not disentitle the assessee from claiming exemption.

The Tribunal held that since there were no fresh investments, no borrowed funds utilized for investments, and no exempt income earned during the year, the disallowance under Section 14A was not justified. Therefore, the disallowance was deleted.

The Tribunal noted that the assessee had produced documentary evidence showing compliance with the notices. Since these documents were not considered by the lower appellate authority, the matter was remanded back for fresh consideration.

The Tribunal deleted the disallowance of 15% of expenses for lack of specific rationale. It upheld the disallowance of interest and remuneration to partners due to the Section 144 assessment. The addition for negative cash balance was sustained, and the issue of depreciation on the shop was remanded for verification.

The Tribunal held that the transactions were genuine as they were conducted through account payee cheques and the bank account was jointly operated. The repayment of the loan and subsequent introduction of capital were not non-genuine merely because the lender had passed away, as her husband continued to operate the joint account.

The Tribunal held that ad hoc additions and disallowances made without specific defects or discrepancies in the books of accounts are not legally maintainable. The Tribunal directed deletion of the ad hoc addition on service charges and restricted the disallowances on vehicle and telephone expenses.

The Tribunal held that ad hoc additions and disallowances made without pointing out specific defects or discrepancies in the assessee's books of accounts are not legally sustainable. The Tribunal directed the deletion of certain additions and restricted the disallowances.

The Tribunal held that the reassessment proceedings were validly initiated. However, it allowed the deletion of the addition sustained under Section 68, finding that the assessee had discharged the initial onus by submitting affidavits. The claims for cost of improvement and brokerage were disallowed due to lack of evidence.

The Tribunal held that the addition on account of excess stock was not justified as the valuation by the departmental valuer was flawed. The addition for unverifiable purchases was also deleted, as the assessee had provided sufficient documentary evidence and payment proofs.

The Tribunal set aside the CIT(A)'s order and remanded the matter back for a fresh adjudication. The assessee was granted one more opportunity of hearing, with a clear direction that failure to appear would vacate this opportunity.

The Tribunal noted that the Karta of the HUF had expired, causing transition challenges. It also observed that some entries in the survey documents might not be unexplained investment and that the assessee had submitted explanations for the sources of investment which were not considered.

The Tribunal held that the assessee failed to satisfactorily explain the nature and source of the credits. The Assessing Officer's addition of Rs. 80.00 lakhs was confirmed, as the investor companies' creditworthiness and the genuineness of the transactions were not established.

The Tribunal held that if FDRs are inextricably linked to the business of securing contracts, the interest earned thereon should be treated as business income, not income from other sources.

The Tribunal noted that the Karta of the HUF had expired, causing transition challenges. It also observed that some entries in the survey documents might not be unexplained investment and that the assessee had submitted explanations for the sources of investment which were not considered.

The Tribunal noted that the Karta of the HUF had expired, causing transition challenges. It also observed that some entries in the survey documents might not be unexplained investment and that the assessee had submitted explanations for the sources of investment which were not considered.

The Tribunal noted that the Karta of the HUF had expired, causing transition challenges. It also observed that some entries in the survey documents might not be unexplained investment and that the assessee had submitted explanations for the sources of investment which were not considered.

The Tribunal held that if FDRs are inextricably linked to the business of securing contracts, the interest earned thereon should be treated as business income, not income from other sources.

The Tribunal held that the assessee failed to substantiate the donations with credible and verifiable evidence, including complete donor names and addresses. Therefore, the invocation of Section 13(7) read with Section 115BBC by the Assessing Officer was justified.

The Tribunal held that the CIT(Exemptions) erred in withdrawing the registration, as the relevant section was not applicable retrospectively for the assessment year in question. Consequently, the assessment order based on the withdrawn registration was also set aside.