ITAT Kolkata Judgments — September 2023

The Tribunal restored the issue of notional interest to the CIT(A) for re-examination, allowing the revenue's grounds for statistical purposes. The assessee's ground regarding disallowance under Section 14A was allowed to be re-examined by the AO in light of jurisdictional High Court ruling.

The Tribunal held that the appeal filed by the Revenue was under improper jurisdiction. Citing the Supreme Court's decision in PCIT Vs. ABC Papers Ltd. and the Bombay High Court's decision in MSPL Ltd. Vs. PCIT & Ors., the Tribunal noted that the ordinary jurisdiction of an ITAT Bench is determined by the location of the Assessing Officer who passed the impugned order. Since the assessment order was passed by the DCIT, Circle Yamuna Nagar, Jagadhri, Haryana, which does not fall within the jurisdiction of the ITAT Kolkata benches, the appeal was dismissed. The Revenue was granted liberty to file a fresh appeal before the appropriate bench with a petition for condonation of delay. The period exhausted in filing the present appeal and its disposal was to be considered for condonation of delay.

The Tribunal set aside the CIT(E)'s order and restored the issue to the CIT(E) for fresh adjudication. This was done to ensure principles of natural justice were followed and the assessee was given an adequate opportunity to be heard.

The Tribunal held that even if the benefit of Section 11 is not granted due to delayed filing, the expenditure incurred for charitable purposes should be allowed to be set off against gross receipts. For AY 2019-20, the return was filed within the due date, making the assessee eligible for the exemption.

The Tribunal deleted the addition of Rs. 9,00,000/- as it was offered in a subsequent year, preventing double taxation. The addition of Rs. 38,00,000/- was also deleted as it was already accounted for as sale of goods in the assessee's books.

The Tribunal held that in cases of unabated assessment years, additions can only be made on the basis of incriminating material found and seized during the course of a search. The Tribunal noted that the AO had made additions on account of the sale of shares, considering the purchasing entities as suspicious shell companies. However, the Tribunal found that there was no incriminating seized material pertaining to the sale of investments by the assessee. Following the ratio laid down by the Hon'ble Apex Court in PCIT vs. Abhisar Buildwell Pvt. Ltd. and DCIT vs. UK Paints (Overseas Ltd.), the Tribunal upheld the order of the Ld. CIT(A) which had deleted the addition. Consequently, the appeals filed by the revenue were dismissed.

The Tribunal held that in cases of unabated assessment years, additions can only be made on the basis of incriminating material found and seized during the course of a search. The Tribunal noted that the AO had made additions on account of the sale of shares, considering the purchasing entities as suspicious shell companies. However, the Tribunal found that there was no incriminating seized material pertaining to the sale of investments by the assessee. Following the ratio laid down by the Hon'ble Apex Court in PCIT vs. Abhisar Buildwell Pvt. Ltd. and DCIT vs. UK Paints (Overseas Ltd.), the Tribunal upheld the order of the Ld. CIT(A) which had deleted the addition. Consequently, the appeals filed by the revenue were dismissed.

The Tribunal held that in cases of unabated assessment years, additions can only be made on the basis of incriminating material found and seized during the course of a search. The Tribunal noted that the AO had made additions on account of the sale of shares, considering the purchasing entities as suspicious shell companies. However, the Tribunal found that there was no incriminating seized material pertaining to the sale of investments by the assessee. Following the ratio laid down by the Hon'ble Apex Court in PCIT vs. Abhisar Buildwell Pvt. Ltd. and DCIT vs. UK Paints (Overseas Ltd.), the Tribunal upheld the order of the Ld. CIT(A) which had deleted the addition. Consequently, the appeals filed by the revenue were dismissed.

The Tribunal held that in cases of unabated assessment years, additions can only be made on the basis of incriminating material found and seized during the course of a search. The Tribunal noted that the AO had made additions on account of the sale of shares, considering the purchasing entities as suspicious shell companies. However, the Tribunal found that there was no incriminating seized material pertaining to the sale of investments by the assessee. Following the ratio laid down by the Hon'ble Apex Court in PCIT vs. Abhisar Buildwell Pvt. Ltd. and DCIT vs. UK Paints (Overseas Ltd.), the Tribunal upheld the order of the Ld. CIT(A) which had deleted the addition. Consequently, the appeals filed by the revenue were dismissed.

The Tribunal held that in cases of unabated assessment years, additions can only be made on the basis of incriminating material found and seized during the course of a search. The Tribunal noted that the AO had made additions on account of the sale of shares, considering the purchasing entities as suspicious shell companies. However, the Tribunal found that there was no incriminating seized material pertaining to the sale of investments by the assessee. Following the ratio laid down by the Hon'ble Apex Court in PCIT vs. Abhisar Buildwell Pvt. Ltd. and DCIT vs. UK Paints (Overseas Ltd.), the Tribunal upheld the order of the Ld. CIT(A) which had deleted the addition. Consequently, the appeals filed by the revenue were dismissed.

The Tribunal held that in cases of unabated assessment years, additions can only be made on the basis of incriminating material found and seized during the course of a search. The Tribunal noted that the AO had made additions on account of the sale of shares, considering the purchasing entities as suspicious shell companies. However, the Tribunal found that there was no incriminating seized material pertaining to the sale of investments by the assessee. Following the ratio laid down by the Hon'ble Apex Court in PCIT vs. Abhisar Buildwell Pvt. Ltd. and DCIT vs. UK Paints (Overseas Ltd.), the Tribunal upheld the order of the Ld. CIT(A) which had deleted the addition. Consequently, the appeals filed by the revenue were dismissed.

The Tribunal held that in cases of unabated assessment years, additions can only be made on the basis of incriminating material found and seized during the course of a search. The Tribunal noted that the AO had made additions on account of the sale of shares, considering the purchasing entities as suspicious shell companies. However, the Tribunal found that there was no incriminating seized material pertaining to the sale of investments by the assessee. Following the ratio laid down by the Hon'ble Apex Court in PCIT vs. Abhisar Buildwell Pvt. Ltd. and DCIT vs. UK Paints (Overseas Ltd.), the Tribunal upheld the order of the Ld. CIT(A) which had deleted the addition. Consequently, the appeals filed by the revenue were dismissed.

The Tribunal held that in cases of unabated assessment years, additions can only be made on the basis of incriminating material found and seized during the course of a search. The Tribunal noted that the AO had made additions on account of the sale of shares, considering the purchasing entities as suspicious shell companies. However, the Tribunal found that there was no incriminating seized material pertaining to the sale of investments by the assessee. Following the ratio laid down by the Hon'ble Apex Court in PCIT vs. Abhisar Buildwell Pvt. Ltd. and DCIT vs. UK Paints (Overseas Ltd.), the Tribunal upheld the order of the Ld. CIT(A) which had deleted the addition. Consequently, the appeals filed by the revenue were dismissed.

The Tribunal held that in cases of unabated assessment years, additions can only be made on the basis of incriminating material found and seized during the course of a search. The Tribunal noted that the AO had made additions on account of the sale of shares, considering the purchasing entities as suspicious shell companies. However, the Tribunal found that there was no incriminating seized material pertaining to the sale of investments by the assessee. Following the ratio laid down by the Hon'ble Apex Court in PCIT vs. Abhisar Buildwell Pvt. Ltd. and DCIT vs. UK Paints (Overseas Ltd.), the Tribunal upheld the order of the Ld. CIT(A) which had deleted the addition. Consequently, the appeals filed by the revenue were dismissed.

The Tribunal held that in cases of unabated assessment years, additions can only be made on the basis of incriminating material found and seized during the course of a search. The Tribunal noted that the AO had made additions on account of the sale of shares, considering the purchasing entities as suspicious shell companies. However, the Tribunal found that there was no incriminating seized material pertaining to the sale of investments by the assessee. Following the ratio laid down by the Hon'ble Apex Court in PCIT vs. Abhisar Buildwell Pvt. Ltd. and DCIT vs. UK Paints (Overseas Ltd.), the Tribunal upheld the order of the Ld. CIT(A) which had deleted the addition. Consequently, the appeals filed by the revenue were dismissed.

The Tribunal held that in cases of unabated assessment years, additions can only be made on the basis of incriminating material found and seized during the course of a search. The Tribunal noted that the AO had made additions on account of the sale of shares, considering the purchasing entities as suspicious shell companies. However, the Tribunal found that there was no incriminating seized material pertaining to the sale of investments by the assessee. Following the ratio laid down by the Hon'ble Apex Court in PCIT vs. Abhisar Buildwell Pvt. Ltd. and DCIT vs. UK Paints (Overseas Ltd.), the Tribunal upheld the order of the Ld. CIT(A) which had deleted the addition. Consequently, the appeals filed by the revenue were dismissed.

The Tribunal held that in cases of unabated assessment years, additions can only be made on the basis of incriminating material found and seized during the course of a search. The Tribunal noted that the AO had made additions on account of the sale of shares, considering the purchasing entities as suspicious shell companies. However, the Tribunal found that there was no incriminating seized material pertaining to the sale of investments by the assessee. Following the ratio laid down by the Hon'ble Apex Court in PCIT vs. Abhisar Buildwell Pvt. Ltd. and DCIT vs. UK Paints (Overseas Ltd.), the Tribunal upheld the order of the Ld. CIT(A) which had deleted the addition. Consequently, the appeals filed by the revenue were dismissed.

The Tribunal held that in cases of unabated assessment years, additions can only be made on the basis of incriminating material found and seized during the course of a search. The Tribunal noted that the AO had made additions on account of the sale of shares, considering the purchasing entities as suspicious shell companies. However, the Tribunal found that there was no incriminating seized material pertaining to the sale of investments by the assessee. Following the ratio laid down by the Hon'ble Apex Court in PCIT vs. Abhisar Buildwell Pvt. Ltd. and DCIT vs. UK Paints (Overseas Ltd.), the Tribunal upheld the order of the Ld. CIT(A) which had deleted the addition. Consequently, the appeals filed by the revenue were dismissed.

The Tribunal upheld the CIT(A)'s decision, following the jurisdictional High Court's ruling in the assessee's own case. It held that the lease premium deduction was allowable as a business expenditure and that prior period expenses were also deductible. The Tribunal also allowed investment allowance under Section 35AD for a temperature-controlled warehouse, finding that operations commenced in FY 2017-18 despite the trade license being issued later.

The Tribunal upheld the CIT(A)'s decision, following the jurisdictional High Court's ruling that proportionate lease premium is a deductible business expenditure. Similarly, prior period expenses were also allowed as deductible.

The Tribunal upheld the CIT(A)'s decision, following the jurisdictional High Court's ruling in the assessee's own case. It held that the lease premium deduction was allowable as a business expenditure and that prior period expenses were also deductible. The Tribunal also allowed investment allowance under Section 35AD for a temperature-controlled warehouse, finding that operations commenced in FY 2017-18 despite the trade license being issued later.

The Tribunal allowed the deduction for cess paid on green leaf as it was self-disallowed in the preceding year. However, it dismissed the claim for PF contributions, following a Supreme Court judgment. The addition under Section 41 was deleted as the income was already offered for tax.

The Tribunal held that in cases of unabated assessment years, additions can only be made on the basis of incriminating material found and seized during the course of a search. The Tribunal noted that the AO had made additions on account of the sale of shares, considering the purchasing entities as suspicious shell companies. However, the Tribunal found that there was no incriminating seized material pertaining to the sale of investments by the assessee. Following the ratio laid down by the Hon'ble Apex Court in PCIT vs. Abhisar Buildwell Pvt. Ltd. and DCIT vs. UK Paints (Overseas Ltd.), the Tribunal upheld the order of the Ld. CIT(A) which had deleted the addition. Consequently, the appeals filed by the revenue were dismissed.

The Tribunal held that in cases of unabated assessment years, additions can only be made on the basis of incriminating material found and seized during the course of a search. The Tribunal noted that the AO had made additions on account of the sale of shares, considering the purchasing entities as suspicious shell companies. However, the Tribunal found that there was no incriminating seized material pertaining to the sale of investments by the assessee. Following the ratio laid down by the Hon'ble Apex Court in PCIT vs. Abhisar Buildwell Pvt. Ltd. and DCIT vs. UK Paints (Overseas Ltd.), the Tribunal upheld the order of the Ld. CIT(A) which had deleted the addition. Consequently, the appeals filed by the revenue were dismissed.

The Tribunal held that in cases of unabated assessment years, additions can only be made on the basis of incriminating material found and seized during the course of a search. The Tribunal noted that the AO had made additions on account of the sale of shares, considering the purchasing entities as suspicious shell companies. However, the Tribunal found that there was no incriminating seized material pertaining to the sale of investments by the assessee. Following the ratio laid down by the Hon'ble Apex Court in PCIT vs. Abhisar Buildwell Pvt. Ltd. and DCIT vs. UK Paints (Overseas Ltd.), the Tribunal upheld the order of the Ld. CIT(A) which had deleted the addition. Consequently, the appeals filed by the revenue were dismissed.

The Tribunal held that in cases of unabated assessment years, additions can only be made on the basis of incriminating material found and seized during the course of a search. The Tribunal noted that the AO had made additions on account of the sale of shares, considering the purchasing entities as suspicious shell companies. However, the Tribunal found that there was no incriminating seized material pertaining to the sale of investments by the assessee. Following the ratio laid down by the Hon'ble Apex Court in PCIT vs. Abhisar Buildwell Pvt. Ltd. and DCIT vs. UK Paints (Overseas Ltd.), the Tribunal upheld the order of the Ld. CIT(A) which had deleted the addition. Consequently, the appeals filed by the revenue were dismissed.

The Tribunal held that in cases of unabated assessment years, additions can only be made on the basis of incriminating material found and seized during the course of a search. The Tribunal noted that the AO had made additions on account of the sale of shares, considering the purchasing entities as suspicious shell companies. However, the Tribunal found that there was no incriminating seized material pertaining to the sale of investments by the assessee. Following the ratio laid down by the Hon'ble Apex Court in PCIT vs. Abhisar Buildwell Pvt. Ltd. and DCIT vs. UK Paints (Overseas Ltd.), the Tribunal upheld the order of the Ld. CIT(A) which had deleted the addition. Consequently, the appeals filed by the revenue were dismissed.

The Tribunal held that in cases of unabated assessment years, additions can only be made on the basis of incriminating material found and seized during the course of a search. The Tribunal noted that the AO had made additions on account of the sale of shares, considering the purchasing entities as suspicious shell companies. However, the Tribunal found that there was no incriminating seized material pertaining to the sale of investments by the assessee. Following the ratio laid down by the Hon'ble Apex Court in PCIT vs. Abhisar Buildwell Pvt. Ltd. and DCIT vs. UK Paints (Overseas Ltd.), the Tribunal upheld the order of the Ld. CIT(A) which had deleted the addition. Consequently, the appeals filed by the revenue were dismissed.

The Tribunal held that the assessee failed to provide sufficient documentation to explain the nature and source of the share capital. Therefore, the addition made by the Assessing Officer under Section 68 was upheld.

The Tribunal set aside the ex-parte order of the CIT(A) and restored the issues to the CIT(A) for fresh adjudication. This was done considering the Covid-19 pandemic restrictions and in the interest of justice to provide the assessee with an opportunity to present their case.

The Tribunal held that the addition made by the AO and confirmed by the CIT(A) solely on the basis of suspicion, without pointing out specific defects in the transaction or the buyers' credentials, was not justified. The Tribunal noted that the CBDT circular dated October 3, 2003, advises against making additions solely on confessional statements obtained under pressure, emphasizing the need for corroborative evidence. The Tribunal also referred to case law stating that statements made under pressure cannot be taken as conclusive without supporting evidence. The Tribunal found that the assessee's opening balance of investments and purchases during the year were not disputed. However, considering the revenue's submission regarding the profit element on the sale of shares held for several years, the Tribunal decided to sustain a net profit element of 5% of the sale consideration. Accordingly, the addition of Rs. 17,05,60,000/- was deleted to the extent of Rs. 16,20,32,000/-, and Rs. 85,28,000/- was sustained as profit on the sale transaction. The operative direction is to delete the addition to the extent of Rs. 16,20,32,000/- and sustain Rs. 85,28,000/-.