ITAT Kolkata Judgments — June 2017

The Tribunal restored the matter to the file of the CIT(A) for fresh adjudication. This was done in the interest of natural justice, acknowledging the possibility of non-receipt of notices due to address change.

The Tribunal restored the issue of Section 80IB(11A) deduction to the AO for fresh adjudication, allowing the Revenue's appeal for statistical purposes. The addition made by the AO for rent receipts was not explicitly addressed in the final decision for this part.

The Tribunal held that the CIT(A) was correct in allowing the accumulation of fees under Section 11(2) by admitting revised forms, following the Gujarat High Court's decision in CIT vs. Mayur Foundation.

The Tribunal held that once the turnover declared by the assessee was accepted, no further addition could be made on account of bank deposits. Since the declared turnover exceeded the total deposits, the addition was unjustified.

The Tribunal held that the assessee's loan liability reduced during the year while property investment increased, indicating that no borrowed funds were utilized for the property investment. Therefore, the disallowance of interest was unjustified.

The Tribunal found the CIT(A)'s estimation of 1.5% to be high, considering the assessee's past profit declarations. It directed the AO to re-compute profit at 0.80% of turnover, partly allowing the assessee's appeal.

The Tribunal held that the Assessing Officer was not justified in adding the entire deposits without considering withdrawals. The Commissioner (Appeals) correctly restricted the addition to the peak credit of the bank accounts, but the Tribunal reversed this decision due to lack of evidence, restoring the AO's order for the first issue.

The Tribunal held that unabsorbed depreciation continues to be available for set-off against book profits until it is fully utilized, irrespective of prior year adjustments. The adjustment made in the preceding year was in the computation of income, not in the books of account.

The Tribunal held that the assessment order was passed without confronting the statement of Shri A.K. Mitra to the assessee, violating principles of natural justice. Therefore, the matter was restored to the AO for fresh adjudication after providing the statement to the assessee.

The Tribunal held that the expenses, such as taxi meters and related equipment, were revenue in nature as they were installed in third-party vehicles for call taxi services. However, the allowability depended on proving they were incurred for business purposes.

The Tribunal held that only the assessee's direct shareholding in M/s. Mega Resources Ltd. should be considered for Section 2(22)(e), not that of its subsidiary. The CIT(A)'s deletion of the addition was upheld.

The Tribunal held that the CIT(A) was justified in allowing the claim for TDS credit, even though it was not claimed in the original return and a revised return was not filed. The appellate authorities have the power to consider such claims to determine the correct tax liability.

The Tribunal held that the addition of jewellery value in the assessee's hands was not permissible as the wife owned it and was assessed separately. Regarding courier business, the Tribunal upheld the CIT(A)'s direction to restrict the assessment to the found suppressed receipts, disallowing further expenses beyond those already debited in the income and expenditure account.

The Tribunal held that the disallowance under Section 14A cannot be directly imported into the computation of book profit under Section 115JB. The matter was remanded for independent computation as per clause (f) of Explanation 1 to Section 115JB.

The Tribunal held that dividend income earned from shares held as stock-in-trade does not warrant disallowance under Section 14A. Furthermore, it was noted that the assessee had sufficient own funds, making the disallowance of interest expenses under Rule 8D(2)(ii) unsustainable.

The Tribunal held that the value of rent-free accommodation should be determined based on municipal valuation, not on past high rental income of the company. The Tribunal upheld the deletion of the AO's addition by the CIT(A) in part.

The Tribunal held that the penalty imposed was unsustainable because the show cause notice issued under Section 274 of the Act did not specify whether the charge was for concealment of income or furnishing inaccurate particulars of income. The penalty was directed to be cancelled.

The Tribunal upheld the CIT's order, agreeing that the AO's inquiry into the share capital and premium was not proper. The CIT was justified in revising the assessment order to direct a thorough inquiry.

The Tribunal held that the assessee had shown reimbursement of expenses in its profit and loss account, contrary to the authorities below's observation. It also found that Cipla Ltd. had confirmed TDS deduction on service tax, and no defects were found in the assessee's books. Therefore, the addition made by the AO was reversed.

The Tribunal held that the waiver of the amount due for machinery purchase cannot be considered a subsidy or grant under Explanation 10 to Section 43(1). As the purchase was made in earlier assessment years, the actual cost recognized then could not be disturbed.

The Tribunal held that the company, Victor Credit & Construction (P) Ltd., had indeed been struck off from the register of companies and was dissolved under Section 560 of the Companies Act, 1956. Consequently, it ceased to exist in the eyes of law during the relevant assessment year. The Tribunal reasoned that there is no provision in the Income-tax Act to assess a dissolved company, and an assessment order passed against a non-existent entity is void and null. The Tribunal relied on the decision in Impsat Pvt. Ltd. and the ITAT, Delhi Bench's decision in ITO vs Vived Marketing Servicing Pvt Ltd, which was upheld by the Delhi High Court. The Tribunal rejected the revenue's argument that filing a return of income by the assessee could validate the assessment, stating there is no estoppel against a statute and such conduct cannot confer jurisdiction on the AO to assess a non-existent entity. The appeal of the assessee was allowed.

The Tribunal held that the penalty notice was bad in law as it failed to specify the limb of Section 271(1)(c) under which the proceedings were initiated. Following the Karnataka High Court's decisions, the Tribunal cancelled the penalty.

The Tribunal noted that the assessee did not appear for the hearing. After perusing the records, the Tribunal proceeded to adjudicate the appeals. The judgment does not explicitly state what the tribunal decided regarding the registration and approval.