ITAT Kolkata Judgments — January 2023

The Tribunal held that the non-compete fee was not to be assessed as capital gains but as business income under Section 28(va) of the Income Tax Act. It found no merit in the assessees' contention that it should be part of the total sale consideration.

The Tribunal held that the non-compete fee was not to be assessed as capital gains but as business income under Section 28(va) of the Income Tax Act. It found no merit in the assessees' contention that it should be part of the total sale consideration.

The Tribunal held that the non-compete fee, as per the agreement, was specifically for refraining from business activities and was therefore taxable under the head 'Profits and gains of business or profession' as per Section 28(va). The assessees' contention to treat it as capital gains was rejected.

The Tribunal held that the non-compete fee was not to be assessed as capital gains but as business income under Section 28(va) of the Income Tax Act. It found no merit in the assessees' contention that it should be part of the total sale consideration.

The Tribunal held that the non-compete fee was not to be assessed as capital gains but as business income under Section 28(va) of the Income Tax Act. It found no merit in the assessees' contention that it should be part of the total sale consideration.

The Tribunal held that since the revisionary proceedings under Section 263 were quashed by a prior ITAT order, the consequential assessment order passed under Section 143(3) read with Section 263 became infructuous. Therefore, the CIT(A) was correct in allowing the assessee's appeal.

The Tribunal held that since the revisionary proceedings under Section 263 were quashed by a prior ITAT order, the consequential assessment order passed under Section 143(3) read with Section 263 became infructuous. Therefore, the CIT(A) was correct in allowing the assessee's appeal.

The Tribunal held that the assessee had discharged its onus by providing details like PANs, ITRs, audited balance sheets, and bank statements of the subscribing companies, proving the identity, genuineness, and creditworthiness of the transactions. The Tribunal also noted that the first proviso to Section 68, which was introduced later, was not applicable to the assessment year in question.

The Tribunal found that the CIT(A) erred in quashing the Section 148 notice solely on legal grounds without examining the merits. The AO had sufficient reasons to believe income had escaped assessment, based on information about accommodation entries.

The Tribunal held that the reassessment proceedings were not justified as the addition made was not for the reasons recorded for reopening. Furthermore, the Ghaziabad flat was not habitable due to lack of power and water, making the deemed rental income addition unjustified.

The Tribunal held that since the revisionary proceedings under Section 263 were quashed by a prior ITAT order, the consequential assessment order passed under Section 143(3) read with Section 263 became infructuous. Therefore, the CIT(A) was correct in allowing the assessee's appeal.

The Tribunal found that the cash deposits were out of advance received against the sale of property, as evidenced by the agreement to sell. Therefore, the addition was deleted.

The Tribunal held that the interest income earned by the non-resident assessee from India is taxable at the beneficial rate of 12.5% as per the India-UAE DTAA. Other grounds were considered consequential or academic.

The Tribunal held that the delayed deposit of Employees' Contribution to PF/ESI is not deductible, citing the Supreme Court's decision in Checkmate Services Pvt. Ltd. The Tribunal also held that interest on delayed deposit of TDS is not an allowable expenditure, as it is inextricably connected with the income-tax itself.

The Tribunal held that the provision for expenses, even if paid after the year-end, should be allowed as a deduction if the liability arose in the accounting year, following the mercantile system of accounting. The addition for unpaid interest was also allowed.

The Tribunal held that Rule 11UA(2) specifically deals with the valuation of unquoted equity shares, while Rule 11UA(1)(c) covers other unquoted shares and securities, requiring a report from a merchant banker or accountant. Since a valuation report was provided for the preference shares, the addition made by the Assessing Officer was not justified.

The Tribunal held that the provision for expenses, even if paid after the year-end, should be allowed as a deduction if the liability arose in the accounting year, following the mercantile system of accounting. The addition for unpaid interest was also allowed.

The Tribunal held that the provision for expenses, even if paid after the year-end, should be allowed as a deduction if the liability arose in the accounting year, following the mercantile system of accounting. The addition for unpaid interest was also allowed.

The Tribunal held that the provision for expenses, even if paid after the year-end, should be allowed as a deduction if the liability arose in the accounting year, following the mercantile system of accounting. The addition for unpaid interest was also allowed.

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 particulars of income or for furnishing inaccurate particulars. Following jurisdictional High Court decisions, the Tribunal found the penalty proceedings unsustainable.

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 particulars of income or for furnishing inaccurate particulars. Following jurisdictional High Court decisions, the Tribunal found the penalty proceedings unsustainable.

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 particulars of income or for furnishing inaccurate particulars. Following jurisdictional High Court decisions, the Tribunal found the penalty proceedings unsustainable.

The Tribunal concurred with the CIT(Appeals) who found that the share applicants were paper companies with no assets or business, and the assessee failed to discharge its onus. Therefore, the addition was confirmed.

The Tribunal noted that the assessee had resolved the issue in dispute with the Revenue under the Vivad Se Viswas Scheme. Therefore, there was no need to keep the appeal pending.

The Tribunal upheld the addition of the capital gains and the disallowance of commission, finding the share transactions to be bogus penny stock. Interest under sections 234A and 234B was also confirmed as consequential.

The Tribunal held that the receipts under RDCA were not taxable as royalty as they constituted reimbursement of costs under a cost-sharing agreement. Similarly, the services under MSSA did not 'make available' technical knowledge, thus not qualifying as fees for technical services.

The Tribunal, after considering the submissions of the Revenue and the lack of response from the assessee, found no reason to interfere with the Assessing Officer's findings.

The Tribunal found that the assessee failed to provide evidence to the AO and did not comply with summons. The CIT(A) also passed a cryptic order without a remand report. Therefore, the matter was restored to the AO for fresh examination.

The Tribunal held that since the CIT's order under Section 263 was subsequently quashed by the Tribunal in the assessee's earlier appeal, the fresh assessment order passed pursuant to it was a nullity. Therefore, the Revenue's appeal was dismissed.

The Tribunal held that the reassessment proceedings were not legally valid as the AO had merely repeated information from the Investigation Wing without independent application of mind. The addition was based on factually incorrect assertions, as the amount in question was already offered as income by the assessee.

The Tribunal held that the assessee failed to justify the high share premium and the source of funds for the share applicants, who themselves had nil income. Therefore, the transactions were considered bogus and sham.

The Tribunal held that the share premium appearing in the assessee's balance sheet was a result of the amalgamation of three transferor companies, as approved by the High Court. The Tribunal found that the assessee had not received any fresh share capital or premium for cash consideration, and the accounting entries were merely a consequence of the approved scheme.

The Tribunal found that the assessee, a retail trader in Sikkim, had a substantial turnover and the cash deposits were out of business sales and realization from debtors. The explanation provided by the assessee was considered reasonable and sufficient to discharge the onus.

The Tribunal held that a contingent liability not provided for in the books of account cannot be added to the income of the assessee as it has no bearing on the current year's income. The addition was therefore incorrect.

The Tribunal held that Section 167B was not applicable as the shares of AOP members were known. It also noted that the income was assessed in the hands of members in other years and allowing the addition would lead to double taxation.

The Tribunal found the assessee's explanation for the cash deposit to be reasonable, considering the quantum of the addition and the facts on record. Therefore, the addition made by the AO and sustained by the CIT(A) was set aside.

The Tribunal found that the difference might be due to TDS on service charges and PF reimbursement, which the assessee claimed were not part of turnover. The issue was restored to the AO for examination and decision.

The Tribunal held that the mechanism for disallowance under Section 14A read with Rule 8D fails when investments are held for a very short period, making average investments zero. It also held that no disallowance under Section 14A can be made to book profit under Section 115JB.

The Tribunal found merit in the assessee's submissions and restored the issue to the AO. The AO was directed to consider interest from savings accounts as deductible under Section 80P, allow corresponding expenses if interest is treated as income from other sources, and treat interest from surplus fund investments as business income.

The Tribunal held that the sponsorship expenses for the director's son's education were not for the exclusive benefit of the business. However, the Tribunal allowed the appeal for statistical purposes, indicating a potential for re-evaluation or further consideration.

The Tribunal held that the sponsorship expenses for the director's son's education were not for the exclusive benefit of the business. However, the Tribunal allowed the appeal for statistical purposes, indicating a potential for re-evaluation or further consideration.

The Tribunal held that the addition of opening cash balance in the current year was not legally correct as it originated from an earlier year. Considering the nature of the assessee's vegetable trading business, the cash balance was deemed acceptable.

The Tribunal held that since the assessee had opted for the Vivad Se Vishwas Scheme and the dispute was settled, the appeal should be considered withdrawn. The order of the CIT(A) was set aside.

The Tribunal accepted the assessee's request to withdraw the appeal. The appeal was dismissed as withdrawn.

The Tribunal held that the CIT(A) violated principles of natural justice by admitting additional evidence without providing the AO an opportunity to examine and rebut it. Therefore, the order of the CIT(A) was set aside.

The Tribunal found the explanation for the delay unconvincing, especially as no one appeared to argue the case. The Tribunal dismissed the appeal as not admitted due to the delay.

The Tribunal, after hearing the DR and perusing the records, found that the assessee had not provided any details to the AO or CIT(A) and was uncooperative. The Tribunal upheld the CIT(A)'s decision to dismiss the appeal due to lack of evidence.

The Tribunal held that the penalty notice issued under Section 271AAB was defective as it did not specify under which clause the penalty was proposed. Following the precedent of the Madras High Court, the penalty order was quashed.

The Tribunal held that the Assessing Officer cannot make an addition on an item different from the one for which the assessment was reopened, unless a fresh reopening is done for that specific item. Therefore, the deletion of the addition by the CIT(Appeals) was upheld.

The Tribunal held that the incorrect mention of the assessment year in the challan and return was a clerical and inadvertent mistake. The dividend was declared in September 2010, which clearly pertains to AY 2011-12.