ITAT Jaipur Judgments — August 2022

The Tribunal held that the Assessing Officer was justified in relying on the valuation report of the Director of Valuation (DVO) for determining the fair market value of the property. The assessee failed to substantiate the higher cost of acquisition claimed.

The Tribunal held that the assessee had provided sufficient documentary evidence, including purchase and sale details through a registered broker and bank statements, to establish the genuineness of the share transactions. The additions made by the AO were based on suspicion rather than concrete evidence.

The Tribunal noted that both the AO and the CIT(A) had decided the case ex parte due to the assessee's non-compliance. However, considering the principles of natural justice, the Tribunal granted one more opportunity to the assessee.

The Tribunal held that the PCIT violated the principles of natural justice by passing an order without affording the assessee adequate opportunity to be heard. The assessee had filed an adjournment application which was not considered before the PCIT passed the revision order.

The Tribunal held that the PCIT erred in initiating revision proceedings on issues not covered by the show cause notice and that the rental income was correctly offered under 'Income from house property' as only land and building were let out.

The Tribunal held that if employee's contributions to EPF/ESI are deposited before the due date of filing the return of income under Section 139(1), no disallowance can be made under Section 36(1)(va) or Section 43B. The amendments made by the Finance Act, 2021, are prospective and not applicable to the assessment year in question.

The ITAT held that the CIT(A) erred in dismissing the appeal for non-prosecution and should have decided on merits. Gross receipts cannot be taxed as income; only the net surplus is taxable.

The Tribunal held that the amendments made by the Finance Act, 2021 to Sections 36(1)(va) and 43B are prospective and not retrospective. Therefore, the disallowance for the assessment year 2018-19 was not applicable.

The Tribunal held that the additional ground raised by the assessee, confirming an addition of Rs. 34,73,212/-, was dismissed. The assessee's submission that the AO was satisfied with past savings of Rs. 14,00,000/- and that the addition of Rs. 5,92,000/- was an estimated ad-hoc addition without basis was considered. The Tribunal noted that the AO remained silent on the estimation of other expenses and the issue of past savings in his remand report. However, the Tribunal found that the assessee's claim of past savings was not substantiated, especially considering the assessee's status. The estimation of other expenses at Rs. 5,92,000/- was also found to lack a scientific basis. Consequently, the Tribunal decided to reduce the addition by 50% for other expenses and 50% of Rs. 7 lakh as past savings, granting relief of Rs. 9,96,000/- out of the total addition of Rs. 19,92,000/-. Therefore, grounds 2 and 3 of the assessee's appeal were partly allowed. The appeal of the revenue was dismissed.

The Tribunal held that the additional ground raised by the assessee, confirming an addition of Rs. 34,73,212/-, was dismissed. The assessee's submission that the AO was satisfied with past savings of Rs. 14,00,000/- and that the addition of Rs. 5,92,000/- was an estimated ad-hoc addition without basis was considered. The Tribunal noted that the AO remained silent on the estimation of other expenses and the issue of past savings in his remand report. However, the Tribunal found that the assessee's claim of past savings was not substantiated, especially considering the assessee's status. The estimation of other expenses at Rs. 5,92,000/- was also found to lack a scientific basis. Consequently, the Tribunal decided to reduce the addition by 50% for other expenses and 50% of Rs. 7 lakh as past savings, granting relief of Rs. 9,96,000/- out of the total addition of Rs. 19,92,000/-. Therefore, grounds 2 and 3 of the assessee's appeal were partly allowed. The appeal of the revenue was dismissed.

The Tribunal held that the amendment to Section 36(1)(va) read with Section 43B of the Act, which made the disallowance mandatory for delayed remittances, was prospective and applicable from Assessment Year 2021-22 onwards. Therefore, for the assessment year under consideration (2019-20), the disallowance was not justified if the contributions were deposited before the due date of filing the return.

The Tribunal held that clarificatory confirmations subsequently issued by some donors for corpus donations cannot be ignored. The intent of the donors to provide corpus donations should be considered.

The Tribunal found that the CIT(A) had disposed of the appeal ex-parte without discussing the issues on merits. Therefore, the matter was set aside and remitted back to the CIT(A) for a fresh decision.

The Tribunal held that interest earned from deposits with cooperative banks is eligible for deduction under Section 80P(2)(d). The Tribunal relied on previous decisions clarifying that cooperative banks are a species of cooperative societies for the purpose of this deduction.

The Tribunal partly allowed the appeal for AY 2015-16, finding that only profit on alleged out-of-book sales (stock shortage) could be added at the average profit rate. The other two appeals for AY 2012-13 and 2014-15 were dismissed as the issues were similar and not pressed or decided in favor of the revenue.

The Tribunal noted that the assessee claimed not to have sold any property, but was a Power of Attorney holder for the actual owners. The appeal was remanded to the AO for fresh adjudication.

The Tribunal admitted additional evidence produced by the assessee, citing the interest of proper adjudication. The matter was set aside to the Assessing Officer for re-examination of the evidence and a fresh decision.

The Tribunal admitted additional evidence produced by the assessee, citing the interest of proper adjudication. The matter was set aside to the Assessing Officer for re-examination of the evidence and a fresh decision.

The Tribunal admitted additional evidence produced by the assessee, citing the interest of proper adjudication. The matter was set aside to the Assessing Officer for re-examination of the evidence and a fresh decision.

The Tribunal partly allowed the appeal for AY 2015-16, finding that only profit on alleged out-of-book sales (stock shortage) could be added at the average profit rate. The other two appeals for AY 2012-13 and 2014-15 were dismissed as the issues were similar and not pressed or decided in favor of the revenue.

The Tribunal partly allowed the appeal for AY 2015-16, finding that only profit on alleged out-of-book sales (stock shortage) could be added at the average profit rate. The other two appeals for AY 2012-13 and 2014-15 were dismissed as the issues were similar and not pressed or decided in favor of the revenue.

The Tribunal held that if the employees' PF and ESI contributions are deposited before the due date of filing the return, no disallowance is warranted. The amendments made by the Finance Act, 2021, were considered prospective.

The Tribunal noted that the CIT(A) had not adjudicated all grounds of appeal related to the additions. Therefore, the Tribunal restored the issues to the file of the CIT(A) for a fresh decision.

The Tribunal admitted additional evidence produced by the assessee, citing the interest of proper adjudication. The matter was set aside to the Assessing Officer for re-examination of the evidence and a fresh decision.

The Tribunal held that the revision proceedings under Section 263 were initiated on the proposal of the AO, not based on the independent application of mind by the PCIT. This was considered a jurisdictional defect.

The Tribunal held that the penalty was unjustifiable as the assessee had withdrawn the incorrect claim and paid taxes promptly upon realizing the mistake. The Tribunal distinguished between concealment and furnishing inaccurate particulars, finding the assessee's actions to be a bona fide mistake.

The Tribunal held that stock in trade is a business asset and not an investment under Section 69. Since the excess stock was not separately identifiable and was part of the overall stock, it should be treated as business income. The AO's view was considered plausible and not erroneous.

The Tribunal held that the Assessing Officer (AO) had conducted the required inquiries and taken a plausible view regarding the share capital. The PCIT failed to demonstrate that the AO's order was erroneous and prejudicial to the revenue, thus the revisionary order was not justified.

The Tribunal held that the Assessing Officer (AO) had conducted sufficient inquiry and accepted the assessee's explanation regarding the share capital and non-applicability of Section 14A. The PCIT's revisionary order was found to be beyond jurisdiction as the AO had taken a plausible view.

The Tribunal held that additions made under section 153A are not sustainable without incriminating material found during the search. Statements from third parties without locus standi and without corresponding admission by the assessee cannot be considered incriminating.

The Tribunal allowed the ground related to unpaid leave encashment, stating that the assessee had already accounted for the unpaid portion. For AY 2014-15, the Tribunal directed the AO to consider the revised return of income and allowed the appeal on this ground. The ad-hoc disallowance for staff welfare and conveyance expenses was deleted due to lack of specific defects.

The Tribunal allowed the ground related to unpaid leave encashment, stating that the assessee had already accounted for the unpaid portion. For AY 2014-15, the Tribunal directed the AO to consider the revised return of income and allowed the appeal on this ground. The ad-hoc disallowance for staff welfare and conveyance expenses was deleted due to lack of specific defects.

The Tribunal held that the Assessing Officer (AO) had conducted sufficient inquiry and accepted the assessee's explanation regarding the share capital and non-applicability of Section 14A. The PCIT's revisionary order was found to be beyond jurisdiction as the AO had taken a plausible view.

The Tribunal held that additions under section 153A cannot be made for completed assessments prior to the search without incriminating material. The revenue's appeal was dismissed on technical grounds.

The Tribunal held that additions made under section 153A are not sustainable without incriminating material found during the search. Statements from third parties without locus standi and without corresponding admission by the assessee cannot be considered incriminating.

The Tribunal held that the assessee had sufficiently explained the source of the cash deposit as withdrawals made earlier for his son's marriage expenses. The addition made by the AO was deemed wrong and unjustified.

The Tribunal held that the assessee had voluntarily surrendered the interest income upon being specifically asked during assessment proceedings, and had offered it for taxation. The Tribunal found that the question of concealment of income did not arise in this context.

The Tribunal upheld the addition of 10% of the total bank deposits as income, finding that the assessee had knowledge of the transactions and failed to prove misuse of his accounts by another party. The assessee's claim for further relief was not substantiated.

The Tribunal held that the transactions recorded in the seized diaries were mere memorandum records and not books of account, thus Section 68 was not applicable. The addition of the entire amount was vacated, but the AO was directed to calculate and tax only the commission income earned by the assessee.

The Tribunal admitted additional evidence as the assessee had sufficient cause for not producing it earlier. The issue was restored to the Assessing Officer to consider the additional evidence and decide the case on merits.

The Tribunal held that the transactions recorded in the seized diaries were mere memorandum records and not books of account, thus Section 68 was not applicable. The addition of the entire amount was vacated, but the AO was directed to calculate and tax only the commission income earned by the assessee.

The Tribunal held that the disallowance made under Section 143(1) regarding employee's contribution to ESI and PF was not sustainable. The amendments brought by the Finance Act, 2021, to Section 36(1)(va) read with Section 43B were prospective and not retrospective.

The Tribunal held that the disallowance under Section 14A cannot exceed the amount of exempt income earned. Therefore, the disallowance was restricted to the exempt income.

The Tribunal held that the amount received by the assessee qualifies as retrenchment compensation under Section 10(10B) of the Act, following the decision of the Madras High Court in a similar case. Therefore, the addition made by the lower authorities was deleted.

The Tribunal held that the donation made by the assessee to another educational trust was eligible as an application of income for determining the surplus that could be exempt under Section 11. Therefore, the CIT's order invoking Section 263 was considered illegal and bad in law.

The Tribunal held that the AO failed to provide details of the alleged fictitious entries or losses, and the basis for the addition was unclear. The Tribunal also found no evidence of commission payment as transactions were made through a recognized stock exchange.

The Tribunal held that the allowability of depreciation at 15% or 30% is not a mistake apparent from the record. Since the issue was debatable and the same rate of depreciation was allowed in earlier and subsequent years, the AO's action under Section 154 was beyond his powers.