ITAT Kolkata Judgments — September 2018

The Tribunal held that the assessee is entitled to claim interest on interest, following Supreme Court and jurisdictional High Court decisions. The AO was directed to re-compute the interest accordingly.

The Tribunal found that the CIT(A) had not decided the case on merits. Therefore, the case was restored to the file of the CIT(A) for fresh adjudication after providing the assessee an opportunity to be heard.

The Tribunal agreed that the CIT(A) no longer had the power to remand for factual verification. However, the Tribunal exercised its own jurisdiction to remit the issue back to the Assessing Officer for necessary factual verification.

The Tribunal directed the Assessing Officer to re-estimate the assessee's profits by taking an average of the profits from the three preceding and succeeding assessment years. This direction is conditional on the assessee providing all relevant details.

The Tribunal upheld the CIT(A)'s decision to delete the upward adjustment for interest on loans to AEs, stating that LIBOR plus a spread is an acceptable benchmark. It also confirmed that corporate guarantee was not an international transaction prior to the 2012 amendment and that Section 14A disallowance was not warranted due to sufficient interest-free funds. The addition of accrued interest was also deleted based on the 'real income theory'.

The Tribunal held that Section 41(1) cannot be invoked when the assessee has acknowledged the liability by continuing to show it in the books of accounts and there is no cessation of liability. The addition was not warranted.

The Tribunal reversed the CIT(A)'s restriction on the Section 36(1)(iii) disallowance, holding that Section 43B is not applicable when the disallowance is made under Section 36(1)(iii). The Tribunal restored the issue of utilizing own funds for asset acquisition to the AO and also restored the issue of interest payment under Section 43B to the AO for verification.

The Tribunal upheld the Assessing Officer's decision regarding the selection of the tested party and the most appropriate method (TNMM) for TP adjustment. However, it deleted the disallowance made under Section 40(a)(ii) and deleted the addition of outstanding TDS demand.

The ITAT found that the CIT(A) had passed an ex-parte order without disposing of the case on merits. Therefore, the ITAT restored the issue to the file of the CIT(A) for fresh adjudication after giving the assessee an adequate opportunity of being heard.

The Tribunal held that the Assessing Officer lacked jurisdiction to issue notices for AYs 2011-12, 2012-13, and 2013-14, quashing these assessments. For AY 2008-09, the appeal was partly allowed for statistical purposes.

The Tribunal partly allowed the Revenue's appeal on the Section 14A disallowance for administrative expenses, reducing it to Rs. 79,822. However, it upheld the CIT(A)'s decision to treat the income from share sales as capital gains, dismissing the Revenue's appeal on this ground.

The Tribunal condoned the delay in filing the appeals due to reasons beyond the assessees' control. It found that the CIT(A) had not adjudicated the merits of the Section 68 additions and had overlooked substantial evidence filed by the assessees. Therefore, the matter was remanded back to the Assessing Officer for fresh examination.

The Tribunal restored the issues of disallowance of interest expenditure, credit card expenses, and exemption under Section 54 to the Assessing Officer for fresh verification. The assessee's grounds of appeal were allowed for statistical purposes.

The Tribunal held that Section 80P(4) does not apply to the assessee as it is a co-operative credit society and not a co-operative bank as defined in the Banking Regulation Act, 1949.

The Tribunal upheld the CIT(A)'s deletion of the addition on account of closing stock valuation, finding it was done as per accounting standards. It also upheld the partial deletion of disallowance for non-deduction of TDS and the deletion of disallowance for irrecoverable advances, considering them as business losses.

The Tribunal restored the appeal to the CIT(A) for fresh adjudication on merits. The CIT(A) was directed to provide three effective opportunities of hearing to the taxpayer.

The Tribunal held that the reasons provided by the assessee for the delay constituted a 'sufficient cause' and that the CIT(A) should have condoned the delay to advance the cause of justice. The matter was remitted back to the CIT(A) for disposal on merits.

The Tribunal held that the assessee failed to provide any evidence to prove the genuineness of the loss. The shares were initially held as investments and their conversion to stock-in-trade was considered a sham arrangement to avoid tax.

The Tribunal found that the CIT(A)'s conclusion was contrary to the assessment order which stated the assessee was engaged in wholesale business. The Tribunal accepted the assessee's ground and deleted the disallowance of expenses.

The tribunal allowed the claim for cases and fines paid to the traffic authority, holding them as necessary business expenditure. For vehicle trip expenses, a lump sum disallowance of ₹20 lac was deemed appropriate. The issue of interest disallowance was remanded to the CIT(A) for adjudication on merits.

The Tribunal condoned the delay in filing the appeals due to reasons beyond the assessees' control. It found that the CIT(A) had not adjudicated the merits of the Section 68 additions and had overlooked substantial evidence filed by the assessees. Therefore, the matter was remanded back to the Assessing Officer for fresh examination.

The Tribunal held that Section 68 of the Income Tax Act is not applicable as it pertains to 'any sum' which implies a sum of money, and no cash was received by the assessee. The transaction was a barter of shares for shares.

The Tribunal condoned the delay in filing the appeals due to reasons beyond the assessees' control. It found that the CIT(A) had not adjudicated the merits of the Section 68 additions and had overlooked substantial evidence filed by the assessees. Therefore, the matter was remanded back to the Assessing Officer for fresh examination.

The Tribunal condoned the delay in filing the appeals due to reasons beyond the assessees' control. It found that the CIT(A) had not adjudicated the merits of the Section 68 additions and had overlooked substantial evidence filed by the assessees. Therefore, the matter was remanded back to the Assessing Officer for fresh examination.

The Tribunal held that both lower authorities erred in treating the assessee's LTCG as bogus. The Tribunal emphasized that decisions should be based on evidence produced by the assessee and not on suspicion or preponderance of probabilities. It noted that no material was brought on record by the AO to controvert the evidence furnished by the assessee. Citing various High Court and Tribunal judgments, including those from the jurisdictional Calcutta High Court and the Mumbai ITAT, the Tribunal found that the assessee had provided sufficient evidence to support the genuineness of the transactions. The elaborate documentation, including bank statements and contract notes, was considered sufficient proof of bona fide transactions. Therefore, the Tribunal accepted the evidence filed by the assessee, allowing the claim that the income in question was bona fide Long Term Capital Gain arising from the sale of shares and hence exempt from income tax. The addition of ₹95,06,050/- and the commission disallowance of ₹4,65,896/- were deleted. The issue of Section 14A disallowance was not pressed.

The Tribunal found that the lower authorities had not properly considered reconciliation statements and relevant documents. Therefore, the issues related to course fee discrepancies, bank deposits, and cash payments were remitted back to the Assessing Officer for fresh adjudication.

The Tribunal held that the Assessing Officer lacked jurisdiction to issue notices for AYs 2011-12, 2012-13, and 2013-14, quashing these assessments. For AY 2008-09, the appeal was partly allowed for statistical purposes.

The Tribunal dismissed the appeal of the Revenue as withdrawn, citing the CBDT circular regarding monetary limits. The Tribunal also noted that the issue was covered by its own previous decision.

The Tribunal deleted the addition of Rs. 95,000/- for unexplained cash deposits, finding sufficient evidence of cash in hand from the preceding year. The addition for lower withdrawals was restricted to Rs. 10,000/-.

The Tribunal held that the Assessing Officer lacked jurisdiction to issue notices for AYs 2011-12, 2012-13, and 2013-14, quashing these assessments. For AY 2008-09, the appeal was partly allowed for statistical purposes.

The Tribunal held that the Assessing Officer lacked jurisdiction to issue notices for AYs 2011-12, 2012-13, and 2013-14, quashing these assessments. For AY 2008-09, the appeal was partly allowed for statistical purposes.

The Tribunal condoned the delay in filing the appeals due to reasons beyond the assessees' control. It found that the CIT(A) had not adjudicated the merits of the Section 68 additions and had overlooked substantial evidence filed by the assessees. Therefore, the matter was remanded back to the Assessing Officer for fresh examination.

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

The Tribunal condoned the delay in filing the appeals due to reasons beyond the assessees' control. It found that the CIT(A) had not adjudicated the merits of the Section 68 additions and had overlooked substantial evidence filed by the assessees. Therefore, the matter was remanded back to the Assessing Officer for fresh examination.

The Tribunal held that both lower authorities erred in treating the assessee's LTCG as bogus. The Tribunal adopted the reasoning from various judgments cited by the assessee, emphasizing that decisions should be based on evidence produced by the assessee and not on suspicion or preponderance of probabilities. The Tribunal noted that no material was brought on record by the Assessing Officer to controvert the evidence furnished by the assessee. Therefore, the Tribunal accepted the evidence filed by the assessee and concluded that the income in question was bona fide long-term capital gain arising from the sale of shares, hence exempt from income tax. Consequently, the addition of ₹93,19,895/- and the commission disallowance of ₹4,65,995/- were deleted. The Tribunal did not expressly leave any issue undecided.

The Tribunal reversed the CIT(A)'s restriction on the Section 36(1)(iii) disallowance, holding that Section 43B is not applicable when the disallowance is made under Section 36(1)(iii). The Tribunal restored the issue of utilizing own funds for asset acquisition to the AO and also restored the issue of interest payment under Section 43B to the AO for verification.

The Tribunal condoned the delay in filing the appeals due to reasons beyond the assessees' control. It found that the CIT(A) had not adjudicated the merits of the Section 68 additions and had overlooked substantial evidence filed by the assessees. Therefore, the matter was remanded back to the Assessing Officer for fresh examination.

The Tribunal held that the Assessing Officer failed to conduct proper verification and that the assessee had provided sufficient evidence regarding the identity, creditworthiness, and genuineness of the share transactions. Therefore, the addition under Section 68 was not sustainable.

The Tribunal deleted the disallowance of loss amounting to ₹1,34,515/-. This was because the assessee's counsel stated that the loss was never claimed, and the Departmental Representative could not rebut this.

The Tribunal held that the payments for subscription & technology fees and indemnity insurance were reimbursements of expenses and incurred wholly and exclusively for business purposes, respectively. Therefore, the assessee was not liable for TDS on these payments.

The Tribunal reduced the disallowance on transport hire charges from ₹14,94,913/- to ₹5,00,000/- and on repair/maintenance charges from ₹2,31,590/- to ₹1,00,000/-. This relief was granted with the rider that it would not set a precedent.

The Tribunal condoned the delay in filing the appeal due to a communication gap. The Tribunal found that the CIT(A) had passed an ex parte order without proper adjudication and restored the appeal to the CIT(A) for fresh adjudication.

The Tribunal dismissed the Revenue's appeal as not maintainable due to the low tax effect, citing CBDT circulars. The Tribunal allowed the assessee's appeal, holding that income from the sale of agricultural land was exempt as agricultural income, following its own previous decision.

The Tribunal upheld the CIT(A)'s decision, noting that it was consistent with previous rulings in the assessee's own cases. The amendment to Section 115JB was deemed applicable only from AY 2013-14 onwards.

The Tribunal held that the assessee did not get a proper opportunity of being heard during the reassessment proceedings. Citing Supreme Court and High Court judgments, it was decided that a de novo assessment is necessary.

The Tribunal dismissed the Revenue's appeal as not maintainable due to the low tax effect, citing CBDT circulars. The Tribunal allowed the assessee's appeal, holding that income from the sale of agricultural land was exempt as agricultural income, following its own previous decision.

The Tribunal held that the survey team's estimation of stock discrepancy was a rough estimate and not based on proper physical verification. Relying on a High Court judgment, the Tribunal found that such estimations without scientific investigation are not tenable for making additions.

The Tribunal held that the penalty imposed under Section 271(1)(c) was not sustainable as the assessee acted in good faith and with due diligence, and the additions made were also not sustainable. The CIT(A)'s order cancelling the penalty was upheld.

The High Court held that one issue was covered by the Supreme Court judgment in CIT vs. Woodward Governor India P.Ltd and not by Section 43A. For other issues, the High Court declined to answer due to the small amount involved and the passage of time, not wishing to investigate factual findings.

The Tribunal held that the CIT(A) erred by setting aside the AO's order and remanding it back to the AO for further inquiry, instead of conducting the inquiry itself. The Tribunal quashed the orders of the authorities below, relying on a High Court judgment.