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169 orders · Page 2 of 4
The Tribunal noted that the CIT(A) dismissed the appeal solely on the ground of delay without considering the cause. The Tribunal also considered that the AO applied a commission income rate of 5% without proper basis. Following a coordinate bench's decision, the Tribunal applied a net profit rate of 0.5%.
The Tribunal observed that the issue of depreciation on re-valued assets was specifically examined by the AO during the original assessment proceedings, as evidenced by the queries raised and the assessee's detailed reply. The Tribunal further noted that the PCIT did not point out any further inquiries that the AO should have made. Following the Hon'ble Supreme Court's decision in Principal Commissioner of Income-tax v. V-Con Integrated Solutions (P.) Ltd., the Tribunal held that the power under Section 263 cannot be invoked merely because the AO was required to make more inquiries.
The Tribunal held that the notice for reopening the assessment under section 148 of the Income-tax Act, 1961, issued on 13.04.2022, was barred by limitation. This was based on the Supreme Court's decision in 'Union of India and others Vs. Rajeev Bansal' which held that the benefit of TOLA (Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020) was not available for AY 2015-16 for reopening beyond the prescribed period.
The Tribunal held that the assessee had discharged its burden of proof by satisfying the conditions under Section 68 of the Act, as the proviso to Section 68 was prospective. Therefore, the addition was deleted.
The Tribunal found that the assessee was not adequately heard at earlier stages and that the claim for exemption under Section 10(26AAA) required further examination. Therefore, the matter was remanded to the AO for fresh assessment.
The Tribunal condoned the delay in filing the appeal. It was held that the CIT(E) rejected the application on technical grounds without a proper examination of the assessee's activities and that the principles of natural justice were violated by providing less than 24 hours to respond to the show-cause notice. The Tribunal found it imperative to provide another opportunity to the assessee.
The Tribunal observed that the AO computed the disallowance under Rule 8D in a mechanical manner without recording any dissatisfaction with the assessee's suo motu disallowance. The assessee's suo motu disallowance of Rs.6,173/- was considered fair and proper as it represented 2.02% of total expenditure while exempt dividend income was 1.4% of taxable income.
The Tribunal held that the rejection of the assessee's application for final approval under Section 80G(5) by the CIT(E) was incorrect. The Tribunal noted that the assessee had been granted provisional approval and subsequently filed for final approval. The rejection was based on the ground that the assessee had commenced activities from 2022-23 and filed Form 10AB beyond the stipulated time limit. Citing the decision in Seth Mahaveer Kumar Sushila Devi Jain Charitable Trust vs. CIT(E), the Tribunal observed that after provisional approval, an application cannot be rejected solely because activities commenced prior to the grant of provisional registration. The commencement of activity for the purpose of the limitation period for final registration under Clause (iii) of the First Proviso to Section 80G(5) should be counted from the date of activity undertaken after the grant of provisional registration. Therefore, the application filed by the assessee was considered within the limitation period. The impugned order of the CIT(Exemption) was set aside, and the matter was remanded to the CIT(E) for fresh consideration, directing the CIT(E) to grant provisional approval if the assessee was otherwise eligible and to decide the application for final registration within three months.
The Tribunal noted that the faceless assessment scheme under section 151A of the Act was notified with effect from 29.03.2022. However, the notice under section 142(1) was issued to the assessee on 15.03.2022, which was prior to the notification. Therefore, the assumption of jurisdiction by the NFAC was without jurisdiction.
The Tribunal condoned the delay in filing the appeals. It set aside the CIT(A)'s order and remanded the matter to the AO to examine the challans and dates of payment, considering the assessee's contention that no show cause notice was issued by the CPC.
The Tribunal condoned the delay in filing the appeals. It set aside the CIT(A)'s order and remanded the matter to the AO to examine the challans and dates of payment, considering the assessee's contention that no show cause notice was issued by the CPC.
The Tribunal held that the Assessing Officer did not adopt the correct method of taxation, which should have been the peak credit method. The Tribunal also noted that the opening balance of a bank account should not be assessed in the current year and that credit for self-assessment tax paid by the assessee was not given.
The Tribunal held that the notice issued under Section 143(2) of the Act was indeed without jurisdiction, rendering the subsequent assessment proceedings void. This conclusion was based on the returned income of the assessee exceeding the pecuniary limit prescribed for an Income Tax Officer (ITO) in a metro city as per CBDT Instruction No. 1/2011. The jurisdiction to issue such a notice lay with the Deputy Commissioner of Income Tax (DCIT) or Assistant Commissioner of Income Tax (ACIT).
The Tribunal held that the CIT(A) had correctly analyzed the facts and submissions. The deposits and withdrawals were reflected in the assessee's books of account and were explained as being in the ordinary course of its business as a cooperative society, with funds belonging to its members. The Tribunal agreed with the CIT(A) that the withdrawals could not be treated as unexplained expenditure under Section 69C.
The Tribunal found that the assessee had already offered the sum of Rs.98,83,992/- for taxation in the subsequent year, and the payment was received in FY 2014-15. Therefore, the addition by the AO would result in double taxation. The Tribunal noted that the assessee provided relevant documents and a reconciliation statement.
The Tribunal upheld the CIT(A)'s order, finding no infirmity. The CIT(A) had correctly allowed the interest expenses by considering sufficient interest-free funds, treated share trading loss as a business loss as Section 73 was not applicable to NBFCs, allowed indexation benefit based on CBDT circulars and Supreme Court rulings, and deleted the addition on share application money after verifying identity, creditworthiness, and genuineness.
The Tribunal held that the assessee had a reasonable cause for the delay in filing the appeal. Due to lack of proper compliance before the lower authorities and to ensure justice, the Tribunal set aside the CIT(A)'s order and restored the appeal to the CIT(A) for a de novo disposal on merits, providing opportunities to both parties.
The Tribunal upheld the CIT(A)'s order, confirming that the AO failed to provide any evidence to prove the transactions were fictitious. The Tribunal found no infirmity in the CIT(A)'s decision to delete the addition.
The Tribunal condoned the delay in filing the appeal, noting that the CIT(A) passed the order without providing a reasonable opportunity of hearing.
The Tribunal found that there was a clerical mistake of Rs. 9,25,382/- in the computation sheet used by the Assessing Officer, which was erroneously upheld by the CIT(A). The assessment order itself had no additions, and the disputed figure was a mistake apparent from the records.
The Tribunal upheld the CIT(A)'s order, finding that the reopening of assessment was bad in law due to lack of independent application of mind by the Assessing Officer and reliance on third-party information without verification. The Tribunal found no infirmity in the CIT(A)'s deletion of additions.
The Tribunal upheld the CIT(A)'s order, finding that the reopening of assessment was bad in law due to lack of independent application of mind by the Assessing Officer and reliance on third-party information without verification. The Tribunal found no infirmity in the CIT(A)'s deletion of additions.
The Tribunal noted that the assessee failed to produce relevant documentary evidence before the lower authorities, and the Assessing Officer passed an order without considering the assessee's explanations. The CIT(A) also found insufficient evidence. However, considering the request for a fresh opportunity and in the interest of natural justice, the matter was remanded.
The tribunal found that both the assessment order and the CIT(A)'s order were passed without considering the assessee's case on merits. In the interest of natural justice, the matter was remanded back to the Assessing Officer for fresh consideration.
The Tribunal noted that the assessee had submitted relevant documents and explanations, and that the addition pertained to freight sales from a subsequent year on which tax had already been paid. The Tribunal found that sustaining the addition would lead to double taxation.
The Tribunal noted that the assessee's appeal had already attained finality, and the previous order quashing the reopening of assessment was not suffering from any apparent mistake. Consequently, the revenue's current appeal, filed after the assessee's appeal was decided, was deemed infructuous.
The Tribunal held that the assessment proceedings were without jurisdiction. Section 151A of the Income Tax Act, 1961, which deals with faceless assessment for escaped income, was brought onto the statute book with effect from 01.11.2020, but was notified only on 29.03.2022. Therefore, any assessment framed by the NFAC prior to the notification date is considered invalid and unsustainable.
The Tribunal held that in both AYs 2016-17 and 2017-18, the Assessing Officer (AO) and the Commissioner of Income-tax (Appeals) had erred in their computation of book profit under Section 115JB of the Income-tax Act, 1961. For AY 2016-17, the Tribunal found that the AO had wrongly taken the book profit at ₹1,38,52,920/- instead of the correct figure of ₹1,15,26,057/-. The Tribunal noted that the assessee had credited deferred tax of ₹23,26,863/- to the profit and loss account, which should have been considered to arrive at the correct book profit as per Section 115JB(1) Explanation 1(vii). Similarly, for AY 2017-18, the Tribunal observed that the deferred tax credit of ₹11,27,426/- was not taken into account, leading to an incorrect book profit. The Tribunal reasoned that the exclusion of deferred tax credit from the book profit calculation was contrary to the provisions of the Act. Consequently, the Tribunal set aside the orders of the CIT(A) and directed the AO to recompute the book profit at the correct figures of ₹1,15,26,057/- for AY 2016-17 and ₹82,28,375/- for AY 2017-18. The ratio decidendi is that deferred tax credit, when credited to the profit and loss account, must be considered for the computation of book profit under Section 115JB of the Act.
The Tribunal held that the provisions of Section 269SS of the Income Tax Act, 1961, are not applicable to capital contributions made by partners to an LLP. Therefore, the penalty levied under Section 271D for accepting cash as capital introduction was unsustainable. The Tribunal also held that the provisions of Section 269T of the Income Tax Act, 1961, are not applicable to cash withdrawals made by partners from their capital accounts. Consequently, the penalty levied under Section 271E for such withdrawals was also not sustainable. The Tribunal set aside the orders of the CIT(A) and directed the Assessing Officer to delete both penalties. The appeals were allowed.
The Tribunal held that the provisions of Section 269SS of the Income Tax Act, 1961, are not applicable to capital contributions made by partners to an LLP. Therefore, the penalty levied under Section 271D for accepting cash as capital introduction was unsustainable. The Tribunal also held that the provisions of Section 269T of the Income Tax Act, 1961, are not applicable to cash withdrawals made by partners from their capital accounts. Consequently, the penalty levied under Section 271E for such withdrawals was also not sustainable. The Tribunal set aside the orders of the CIT(A) and directed the Assessing Officer to delete both penalties. The appeals were allowed.
The Tribunal held that the approval granted by the PCIT for the issuance of notice under Section 148 of the Act was not valid. The Tribunal noted that the PCIT's approval was recorded as 'Yes, I am satisfied, May be reopened'. This was considered a mechanical approval without an independent application of mind, which is contrary to the mandate of Section 151 of the Act. The Tribunal distinguished the revenue's reliance on Meenakshi Overseas Pvt. Ltd. by noting that in that case, the satisfaction was more explicitly stated, and the Additional CIT had issued a letter detailing the consideration of reasons. The Tribunal also referred to the Madhya Pradesh High Court's decision in CIT Jabalpur vs. S. Goyanka Lime & Chemicals Ltd., where a similar mechanical approval was held unsustainable, and this decision was upheld by the Supreme Court. Therefore, the Tribunal concluded that the expression 'Yes' alone does not reflect an independent application of mind and is not a valid approval. Consequently, the impugned notice under Section 148 and the subsequent assessment order under Section 143(3) read with Section 147 were quashed on the ground of invalid approval.
The Tribunal held that the addition made by the AO and confirmed by the NFAC was unsustainable. The assessee had provided substantial evidence, including confirmation letters, ITRs, audited balance sheets, and bank statements of the subscribers and itself, which were admitted by the AO. Crucially, the AO had not conducted any independent enquiry or issued statutory notices to the subscribers. The Tribunal noted that the shares were issued at a premium as per Rule 11UA, and no addition was made under Section 56. The AO's addition was based on a general modus operandi and presumption, not on specific evidence. The Tribunal found that the net worth of KLG Tradefin Pvt. Ltd. (a sister concern) was ₹9.58 crores, and it sourced funds from fixed deposit maturity proceeds and refunds. Reality Vincom Pvt. Ltd. also had a substantial net worth of ₹24.52 crores. The Tribunal relied on a series of decisions of the Kolkata High Court, including PCIT Vs. Goodview Marketing P. Ltd., PCIT vs. Kunjal Synergies Private Limited, and others, which supported the assessee's position. Consequently, the Tribunal set aside the order of the NFAC and directed the AO to delete the addition.
The Tribunal held that the notice issued under Section 143(2) of the Income Tax Act, 1961, was invalid as it was not issued in consonance with CBDT Instruction F No. 225/157/2017/ITA-II dated 23.06.2017. The Tribunal noted that the notice was not in the prescribed format. Citing decisions of co-ordinate benches in Shib Nath Ghosh Vs. ITO and Kamlesh Singh Vs. ITO, the Tribunal held that instructions issued by the CBDT are mandatory and binding on income tax authorities, and failure to adhere to them renders proceedings invalid. The Tribunal further referred to the Supreme Court's decision in UCO Bank (supra) and the Calcutta High Court's decision in Amal Kumar Ghosh (supra) which affirmed the binding nature of CBDT circulars under Section 119 of the Act. Consequently, the Tribunal held that the invalid notice under Section 143(2) rendered all subsequent proceedings, including the assessment order, invalid and void ab initio. The appeal of the assessee was allowed.
The Tribunal held that the notice issued under section 143(2) of the Act was not in the prescribed format as per the CBDT circular. Therefore, the notice was invalid, and all subsequent proceedings, including the assessment order, were also invalid and void ab initio.
The Tribunal held that the reopening of assessment was based on information pertaining to a different financial year and assessment year, and that the AO had not applied his mind independently to the information received, thus committing a mistake repeatedly. The Tribunal cited several High Court judgments emphasizing the need for independent application of mind and tangible material for reopening.
The Tribunal noted that the reopening of the assessment was initiated after a period of three years from the end of the relevant assessment year. Furthermore, the approval for reopening was granted by the PCIT instead of the PCCIT, as required by Section 151 of the Act. The Tribunal relied on various High Court decisions that held such sanctions to be invalid.
The Tribunal held that the reopening of the assessment was bad in law as it did not meet the specific requirements of Section 149(1)(b) of the Income Tax Act, 1961. Additionally, the estimation of income by the Ld. CIT(A) was found to be without basis and without rejecting the books of accounts.
The Tribunal noted that the appeal was barred by limitation but condoned the delay as the reasons were bonafide. The primary issue was the invalidity of the assessment framed by the National Faceless Appeal Centre due to lack of jurisdiction. The Tribunal found that the notification for faceless assessment was issued after the assessment order, rendering it null and void.
The Tribunal held that the notice issued under Section 143(2) of the Income Tax Act, 1961, was not in consonance with the CBDT Instruction F.No. 225/157/2017/ITA-II dated 23.06.2017. Citing the decisions of co-ordinate benches, particularly Shib Nath Ghosh Vs. ITO, and the principles laid down by the Hon'ble Apex Court in UCO Bank and the Hon'ble Calcutta High Court in Amal Kumar Ghosh, the Tribunal found that CBDT instructions are mandatory and binding on income tax authorities. Consequently, the Tribunal concluded that the notice issued was invalid, and all subsequent assessment proceedings, including the assessment framed under Section 143(3), were also invalid and void ab initio. The Tribunal quashed the assessment. The issue regarding the validity of the notice under Section 143(2) was allowed in favour of the assessee.
The Tribunal held that the assessment proceedings were without jurisdiction. Section 151A of the Income Tax Act, 1961, which deals with faceless assessment for escaped income, was brought onto the statute book with effect from 01.11.2020, but was notified only on 29.03.2022. Therefore, any assessment framed by the NFAC prior to the notification date is considered invalid and unsustainable.
The Tribunal held that the notice issued under Section 143(2) was invalid because it did not conform to the format prescribed by the CBDT. Consequently, the assessment framed based on this invalid notice was also held to be invalid and quashed.
The Tribunal found the delay of 566 days to be genuine and condoned it. Since the CIT(A) had decided the appeal ex-parte without considering the merits, the case was restored to the CIT(A) for fresh adjudication.
The Tribunal upheld the order of the CIT(A) on both grounds. Regarding the first issue, concerning the ALP adjustment on interest on loans, the Tribunal found no infirmity in the CIT(A)'s order. While the specific reasoning of the Tribunal on this point is not fully detailed in the provided extract, it implicitly agreed with the CIT(A)'s deletion of the addition. The second issue concerned the deduction under Section 35(2AB) for R&D expenditure. The Tribunal agreed with the CIT(A) that once a research facility is approved by the DSIR, the entire expenditure incurred by the assessee is eligible for deduction under Section 35(2AB). The claim is not dependent on the amount of expenditure approved by the DSIR. The Tribunal relied on the decisions in M/s Natural Remedies Pvt. Ltd., Eicher Motors Limited (Delhi High Court), and Commissioner of Income-tax vs. Sun Pharmaceutical Industries Ltd. (Gujarat High Court), which held that the expenditure allowable under Section 35(2AB) cannot be restricted to the amount specified by the DSIR in Form 3CL. Therefore, the AO had wrongly disallowed the deduction, and the addition made on this count was deleted. Consequently, the appeal filed by the Revenue was dismissed.
The Tribunal held that the notice issued under section 148 was invalid as it was issued prior to the communication of the approval under section 151. This procedural lapse goes to the root of the matter and renders the notice and consequent assessment order null and void.
The Tribunal held that the AO's failure to issue a mandatory notice under Section 143(2) after the assessee filed a valid return (considering the extended period) renders the assessment order invalid and a nullity. The assessment was framed without following the prescribed procedure.
The Tribunal found that the assessee had provided sufficient documents, including ITRs, balance sheets, and bank statements, to establish the identity, creditworthiness, and genuineness of the transactions for the funds received. The authorities below had not pointed out any defect in these documents. Therefore, the Tribunal disagreed with the CIT(A)'s conclusion.
The Tribunal noted that the assessee had borrowed money from a sister concern with common directors and provided all necessary documentation (name, address, PAN, confirmation, bank statement). The AO did not point out any defects in the provided documents and wrongly concluded it was from a shell company. The Ld. CIT(A) correctly appreciated the facts, finding the loan was from a group company with sufficient resources.
The Tribunal held that the PCIT had invalidly exercised jurisdiction under Section 263. The AO had specifically queried the Section 54 claim, and the assessee had provided a comprehensive reply with supporting evidence, which the AO considered before passing the assessment order.
The Tribunal found that the disallowance computed on the basis of average investment yielding exempt income during the year came to Rs. 11,00,748/-. After allowing suo motto deduction, the net disallowance was Rs. 10,75,748/-. The case was found to be squarely covered by the decision of the Hon'ble Kolkata High Court in PCIT Vs. REI Agro Limited.
The Tribunal held that the issuance of the notice under section 148 of the Act prior to the communication of approval under section 151 is a serious lapse that renders the notice and subsequent assessment void. The Tribunal relied on the decision in the case of Paras Plaza Pvt. Ltd. vs. ITO and Apex Court decisions regarding communication of orders.