ITAT Kolkata Judgments — August 2018

The Tribunal held that the penalty notice issued under Section 274 was defective as it failed to specify whether the penalty was for concealment of income or furnishing inaccurate particulars. Following the ratio of the Hon'ble Karnataka High Court in CIT vs. Manjunatha Cotton & Ginning Factory, the Tribunal decided in favour of the assessee.

The tribunal held that the assessee was not given a proper opportunity of being heard during the assessment proceedings. Therefore, the ex-parte order of the CIT(A) was set aside.

The Tribunal set aside the CIT(A)'s order and remanded the issue back for fresh adjudication on merits. This was due to the ex parte nature of the order and lack of findings on service of hearing notices.

The Tribunal held that the revenue's appeal with a tax effect below the prescribed limit was not maintainable and dismissed it. The Tribunal also confirmed the deletion of penalty, stating that the assessee's mistake was inadvertent and there was no concealment of income.

The Tribunal held that the CIT(A) order was passed ex parte without proper adjudication and without affording effective opportunities of hearing to the assessee. Therefore, the appeal was restored to the CIT(A) for fresh adjudication.

The Tribunal found that the assessee had provided substantial documentation in response to notices, which were not considered by the lower authorities. Therefore, the assessee deserves another opportunity to prove the investor details.

The Tribunal found that the assessee's absence was due to the illness of its counsel and not intentional. The CIT(A) had not dealt with the merits of the case.

The Tribunal held that the CIT(A) should have adjudicated the case on merits after providing the assessee with an adequate opportunity of being heard. The matter was restored to the CIT(A) for fresh adjudication.

The Tribunal held that the Revenue's appeals should be dismissed due to the low tax effect, as per CBDT Circular No. 3/2018. The Tribunal also held that the assessees' cross-objections were maintainable as they involved independent issues.

The Tribunal held that the Revenue's appeals should be dismissed due to low tax effect, as per CBDT Circular No. 3/2018. Cross objections filed by the assessees were held to be maintainable as they involved independent issues.

The Tribunal held that the Revenue's appeals should be dismissed due to the low tax effect, as per CBDT Circular No. 3/2018. The Tribunal also held that the assessees' cross-objections were maintainable as they involved independent issues.

The Tribunal set aside the assessment to the Assessing Officer for fresh adjudication because the written submissions made by the assessee before the lower authorities were not considered. The assessee was directed to pay a cost of Rs. 10,000/- and cooperate with the assessment.

The Tribunal directed that the disallowance under Section 14A be restricted to the quantum of dividend earned. Regarding the addition under Section 68, the Tribunal held that the opening balance carried forward from the previous year could not be added as a cash credit and deleted the addition after the assessee proved the genuineness of transactions.

The Tribunal held that the assessee had provided sufficient documentary evidence to prove the genuineness of the share transactions. Since the AO did not controvert this evidence with any specific material, the additions made were deleted.

The Tribunal upheld the CIT(A)'s decision that the discount offered to distributors was in the nature of commission and liable for TDS. However, it agreed with the CIT(A)'s direction to verify if the distributors had already paid tax on this income before holding the assessee in default.

The Tribunal held that the assessee is not serious in prosecuting the appeal and that an appeal requires effective pursuit, not just filing. Therefore, the appeal is dismissed for non-prosecution.

The Tribunal held that the assessee was not serious in prosecuting the appeal. Therefore, the appeal was liable to be dismissed for non-prosecution.

The Tribunal held that the CIT(A) rightly deleted the addition as the sales of paddy were accepted and the purchases corresponding to these sales should have been allowed. The Revenue's appeal was dismissed.

The tribunal observed that the assessee was not serious in prosecuting the appeal. Therefore, the appeal was dismissed for non-prosecution, citing various judicial precedents.

The Tribunal upheld the CIT(A)'s decision that the discount offered to distributors was in the nature of commission and liable for TDS. However, it agreed with the CIT(A)'s direction to verify if the distributors had already paid tax on this income before holding the assessee in default.

The Tribunal found that the assessee's absence before the CIT(A) was due to circumstances beyond his control, specifically his daughter's illness. Therefore, to ensure natural justice, the matter was remanded back to the CIT(A) for fresh consideration.

The Tribunal held that the AO's order was passed without proper inquiry into the Section 80P deduction claim. Therefore, the Pr. CIT's order setting aside the assessment for fresh adjudication on this issue was upheld.

The Tribunal upheld the CIT(A)'s decision, finding no infirmity in allowing the deductions. The expenses were considered allowable as they were paid during the year and related to business purposes.

The Tribunal held that no disallowance of interest expenses under Rule 8D(2)(ii) was warranted as the assessee had sufficient interest-free funds to cover investments. For Rule 8D(2)(iii), the disallowance should only consider investments yielding exempt income.

The Tribunal upheld the CIT(A)'s decision that the discount offered to distributors was in the nature of commission and liable for TDS. However, it agreed with the CIT(A)'s direction to verify if the distributors had already paid tax on this income before holding the assessee in default.

The Tribunal noted that the AO's observations regarding share price manipulation were based on a pattern observed in numerous cases. The CIT(A) also found direct evidence of accommodation entries for bogus long-term capital gains.

The ITAT restored the issue to the file of the CIT(A) for fresh adjudication after giving the assessee an opportunity to be heard, citing principles of natural justice. A cost of Rs. 10,000 was levied on the assessee.

The Tribunal found that the CIT(A) had confirmed additions ex parte without proper service of notice. Therefore, in the interest of natural justice, the matter was remanded back to the CIT(A).

The tribunal upheld the CIT(A)'s finding that the differences were timing issues between the assessee and TDS deductors, not a case of suppressed income. The CIT(A) had examined evidence and concluded the discrepancies were due to accounting provisions and invoice raising in subsequent financial years.

The Tribunal upheld the CIT(A)'s decision, stating that the AO erred in changing the consistent method of closing stock valuation without proper justification. Regarding depreciation, the Tribunal agreed that the assessee was the owner for the initial period and entitled to claim depreciation.

The Tribunal held that the assessee had discharged the initial onus by providing documentary evidence for the unsecured loan creditors. The Assessing Officer's failure to elicit further response from the creditors meant the penalty under Section 271(1)(c) was not attracted.

The Tribunal dismissed the ground related to donation disallowance and disallowance of carriage expenditure for non-compliance with TDS provisions. It allowed the issue of bank deposits to be verified by the AO and remitted the issue of interest on fixed deposits for recalculation.

The Tribunal held that the write-off of investments in subsidiaries was a trading loss allowable under Section 28, as the investments were made for the business purpose of promoting the electronics industry. The disallowance under Section 14A was also deleted due to the Assessing Officer's failure to record proper satisfaction.

The Tribunal found that the assessee had reconciled almost its entire purchases with two major suppliers during remand proceedings. The CIT(A)'s order rejecting these arguments was not concurred with, as the difference in purchases was found to be non-existent.

The Tribunal held that the AO did not provide an adequate opportunity to the assessee to cross-examine witnesses whose statements were relied upon. This violation of natural justice necessitates a fresh adjudication.

The Tribunal agreed that the purchase figures were inflated by including commission. However, it found that the valuation of closing stock needed to be re-done by excluding the commission component from total purchases. Other claims of the assessee were dismissed for lack of evidence.

The Tribunal found that the AO accepted cash withdrawals from the business account and that the assessee provided a cash statement explaining deposits and expenses. For the Section 40A(3) issue, the Tribunal noted that the AO himself admitted payments were below the threshold and that the suppliers confirmed the transactions. The Tribunal decided to remand the cash deposit issue for fresh adjudication and allowed the Section 40A(3) issue.

The Tribunal upheld the lower authorities' decision to treat interest income from associate companies as 'income from other sources', finding no evidence of it being a business activity. It also restored the issue of suo moto disallowance of interest and fee to the Assessing Officer for adjudication.

The Tribunal upheld the lower authorities' decision to treat interest income from associate companies as 'income from other sources', finding no evidence of it being a business activity. It also restored the issue of suo moto disallowance of interest and fee to the Assessing Officer for adjudication.

The Tribunal held that the write-off of investments in subsidiaries was a trading loss allowable under Section 28, as the investments were made for the business purpose of promoting the electronics industry. The disallowance under Section 14A was also deleted due to the Assessing Officer's failure to record proper satisfaction.

The Tribunal upheld the lower authorities' decision to treat interest income from associate companies as 'income from other sources', finding no evidence of it being a business activity. It also restored the issue of suo moto disallowance of interest and fee to the Assessing Officer for adjudication.

The Tribunal upheld the lower authorities' decision to treat interest income from associate companies as 'income from other sources', finding no evidence of it being a business activity. It also restored the issue of suo moto disallowance of interest and fee to the Assessing Officer for adjudication.

The Tribunal held that Section 40(a)(ia) applies only to genuine business expenditure, which is contradictory to the AO's finding that the expenses were bogus. Therefore, the disallowance under Section 40(a)(ia) was not applicable. The CIT(A)'s estimation of profit was upheld.

The Tribunal upheld the lower authorities' decision to treat interest income from associate companies as 'income from other sources', finding no evidence of it being a business activity. It also restored the issue of suo moto disallowance of interest and fee to the Assessing Officer for adjudication.

The Tribunal upheld the lower authorities' decision to treat interest income from associate companies as 'income from other sources', finding no evidence of it being a business activity. It also restored the issue of suo moto disallowance of interest and fee to the Assessing Officer for adjudication.

The Tribunal held that the write-off of investments in subsidiaries was a trading loss allowable under Section 28, as the investments were made for the business purpose of promoting the electronics industry. The disallowance under Section 14A was also deleted due to the Assessing Officer's failure to record proper satisfaction.

The Tribunal held that the amount received by the assessee was not a genuine lease deposit as she lacked clear title and possession of the flats. Therefore, it was considered a loan falling under the mischief of Section 2(22)(e) of the Act.

The Tribunal upheld the CIT(A)'s decision that the discount offered to distributors was in the nature of commission and liable for TDS. However, it agreed with the CIT(A)'s direction to verify if the distributors had already paid tax on this income before holding the assessee in default.

The Tribunal condoned the delay due to ill health. It found that neither the AO nor the CIT(A) had properly adjudicated the issue of share capital and premium, failing to discuss the assessee's grievance or evidence.