ITAT Kolkata Judgments — October 2022

The Tribunal held that the payments were below the Rs. 20,000/- limit for cash payments and that the evidence regarding sundry creditors and rental expenses was overlooked by the lower authorities. Consequently, the additions made by the AO and confirmed by the CIT(A) were deleted.

The Tribunal held that the reassessment proceedings were not validly initiated as the information regarding the bank account and transactions was already available with the Revenue during the original assessment. The proviso to Section 147 protected the assessee as no failure to disclose material facts was demonstrated.

The CIT(A) deleted the addition after a remand report from the AO, who confirmed that the assessee had provided all necessary documents and proved the identity, creditworthiness, and genuineness of the transactions. The Tribunal upheld the CIT(A)'s order.

The Tribunal found that the assessee's dispute was solely about the TDS credit not being granted. It was noted that the CIT(Appeals) made a factual error regarding the Vivad Se Vishwas scheme.

The Tribunal noted the casual approach of the assessee and the lack of a proper explanation for the significant delay, especially since the pandemic started much later than the CIT(A) order. The Tribunal did not condone the delay.

The Tribunal held that income from testing services performed entirely in Finland is not taxable in India under Article 12 of the India-Finland DTAA. It also ruled that surcharge and education cess cannot be levied on tax liability computed under the DTAA.

The Tribunal upheld the CIT(A)'s decision, agreeing that foreign associated enterprises could be treated as tested parties and that segmental accounts were acceptable for transfer pricing analysis. The Tribunal found no reason to interfere with the deletion of the transfer pricing adjustment.

The Tribunal upheld the CIT(A)'s decision, agreeing that foreign associated enterprises could be treated as tested parties and that segmental accounts were acceptable for transfer pricing analysis. The Tribunal found no reason to interfere with the deletion of the transfer pricing adjustment.

The Tribunal held that the assessee provided complete details of transactions, including source and application of funds, and had been assessed as engaged in share investment in a prior year. The Tribunal also noted the denial of cross-examination, rendering the assessment invalid.

The Tribunal upheld the CIT(A)'s decision to allow 60% depreciation on SAP software, considering it as computer software eligible for the higher rate. Regarding transfer pricing, the Tribunal agreed with the CIT(A)'s exclusion of certain comparables and the use of segmental data for DHL, finding the assessee's margins to be at arm's length.

The Tribunal held that the PCIT failed to satisfy the twin conditions for invoking Section 263: the order must be erroneous and prejudicial to the revenue. The commodity profit was already disclosed in the assessee's audited Profit and Loss account and offered for taxation, making the PCIT's assumption of under-assessment incorrect.

The Tribunal held that the assessees failed to establish the genuineness of the share price rise and the creditworthiness of the companies. The transactions were complex, and the assessees did not prove that their gains were not tainted by manipulation.

The Tribunal held that the assessees failed to establish the genuineness of the share price rise and the creditworthiness of the companies. The transactions were complex, and the assessees did not prove that their gains were not tainted by manipulation.

The Tribunal held that the assessees failed to establish the genuineness of the share price rise and the creditworthiness of the companies. The transactions were complex, and the assessees did not prove that their gains were not tainted by manipulation.

The Tribunal held that the assessees failed to establish the genuineness of the share price rise and the creditworthiness of the companies. The transactions were complex, and the assessees did not prove that their gains were not tainted by manipulation.

The Tribunal held that the assessees failed to establish the genuineness of the share price rise and the creditworthiness of the companies. The transactions were complex, and the assessees did not prove that their gains were not tainted by manipulation.

The Tribunal held that a private limited company is required to file a return even if active for a part of the financial year. It also directed the jurisdictional AO to verify the TDS credit claims and allow them if found correct after providing an opportunity of hearing.

The Tribunal held that the assessees failed to establish the genuineness of the share price rise and the creditworthiness of the companies. The transactions were complex, and the assessees did not prove that their gains were not tainted by manipulation.

The Tribunal, relying on the Calcutta High Court's decision in Swati Bajaj & Others and its own previous orders, held that the transactions involving Kailash Auto Finance Limited shares were indeed bogus. Therefore, the rejection of the exemption claim and the consequent additions were upheld.

The Tribunal held that the assessees failed to establish the genuineness of the share price rise and the creditworthiness of the companies. The transactions were complex, and the assessees did not prove that their gains were not tainted by manipulation.

The Tribunal found that the CIT(A)'s order was ex parte and the assessee had denied making the investment. Therefore, the interest of justice required giving the assessee an opportunity to present its case.

The Tribunal held that for AY 2020-21, the disallowance of employee's contribution to PF/ESI made before the due date of filing the return is not permissible. The Explanation-5 to Section 43B, inserted by the Finance Act, 2021, is not applicable retrospectively.

The Tribunal held that the disallowance was incorrect as the contributions were deposited before the due date of filing the return. The Explanation-5 to Section 43B, introduced later, was not applicable to the assessment year in question.

The Tribunal held that the assessee had provided sufficient documentary evidence regarding the identity, creditworthiness, and genuineness of the share transactions. The non-appearance of directors in response to summons did not invalidate the evidence filed by the assessee.

The Tribunal held that the interest expenditure was allowable as a deduction under Section 36(1)(iii) of the Income Tax Act. This was based on the reasoning that the investment in the subsidiary, engaged in a similar business, was commercially expedient.

The Tribunal condoned the delay in filing the appeals before the CIT(A) based on the assessee's submissions and affidavit. The matter was restored to the CIT(A) for a fresh decision on merits.

The Tribunal condoned the delay in filing the appeals before the CIT(A) based on the assessee's submissions and affidavit. The matter was restored to the CIT(A) for a fresh decision on merits.

The Tribunal held that the India-Bhutan DTAA, specifically Article 8 concerning air transport, prevails over the Income Tax Act. It concluded that profits from international air transport operations are taxable only in the country where the enterprise's place of effective management is situated, which is Bhutan in this case.

The Tribunal noted that no one appeared for the assessee and the postal authorities indicated the address was vacant. The CIT(Appeals) order was found to largely reproduce a High Court judgment without specific application to the facts. The Tribunal proceeded ex-parte.

The Tribunal held that the conversion of a capital asset into stock-in-trade is permissible if the company's objects clause is amended to include such business. Since the assessee could not provide evidence of a valid amendment to its Memorandum and Articles of Association, the AO's action of treating the sale as a capital gain was upheld.

The Tribunal held that the assessee is entitled to the deduction under sections 54 and 54F. It reasoned that the capital gains arose within one year of taking possession of the new flat, and based on CBDT circulars and case laws, the booking of a flat under construction should be treated as acquisition for the purpose of these deductions.

The Tribunal condoned the delay in filing the appeals before the CIT(A) based on the assessee's submissions and affidavit. The matter was restored to the CIT(A) for a fresh decision on merits.

The Tribunal held that the India-Bhutan DTAA, specifically Article 8 concerning air transport, prevails over the Income Tax Act. It concluded that profits from international air transport operations are taxable only in the country where the enterprise's place of effective management is situated, which is Bhutan in this case.

The Tribunal held that the disallowance was unjustified as the deposit was made before the due date of filing the return. The amendment by the Finance Act, 2021, was prospective and not applicable to the assessment year in question.

The Tribunal held that the PCIT's order under Section 263 was not sustainable. It found that the valuation of shares was done as per the relevant rules on the date of allotment, and crucially, the alleged deemed gift under Section 56(2)(viib) is not taxable in the hands of the assessee company but in the hands of the recipient.

The Tribunal held that the CBDT circular regarding monetary limits for appeals is binding on revenue authorities and applies retrospectively to pending appeals. Since the tax effect was below the prescribed limit, the appeal was dismissed.

The Tribunal held that the disallowance was not justified as the amount was paid before the due date of filing the return. The Explanation-5 to Section 43B, inserted by the Finance Act, 2021, was not applicable to the assessment years under consideration.

The Tribunal held that the addition of old loan liabilities from preceding years in the current assessment year is not permissible under Section 68 of the Income Tax Act. Consequently, the consequential disallowance of interest expenses was also deleted.

The Tribunal upheld the addition of Rs. 29,91,50,000/- as unexplained cash credit under Section 68 of the Income Tax Act. The assessee failed to prove the identity, creditworthiness, and genuineness of the share capital and premium received.

The Tribunal held that the disallowance was not justified as the amount was paid before the due date of filing the return. The Explanation-5 to Section 43B, inserted by the Finance Act, 2021, was not applicable to the assessment years under consideration.

The assessee's counsel informed the tribunal that the assessee was willing to withdraw the appeal. The revenue representative did not object to this request. Therefore, the tribunal accepted the assessee's submission.

The Tribunal held that the PCIT was not justified in setting aside the assessment order for re-verification of purchases from other parties without adverse evidence. The Tribunal relied on previous decisions where similar revision orders were quashed.

The Tribunal condoned the delay in filing the appeal, citing a liberal interpretation of 'sufficient cause' and the impact of COVID-19. It found that the CIT failed to demonstrate how the assessment order was erroneous or prejudicial to the revenue, quashing the CIT's order.