ITAT Mumbai Judgments — January 2017

The Tribunal held that the discrepancy in the application of income was an arithmetical error and directed the deletion of the addition. It also upheld the CIT(A)'s decision to allow the set-off of long-term capital loss, noting that the Revenue had not appealed a similar decision in the past.

The ITAT found that the CIT(A) failed to consider the documentary evidence filed by the assessee and did not seek a remand report. The Tribunal restored the issue to the AO for fresh consideration.

The Tribunal dismissed the assessee's appeal regarding the disallowance of business loss on film finance due to lack of evidence. The Tribunal also dismissed the Revenue's appeal concerning the deletion of deemed dividend, disallowance of bad debts, and disallowance of interest, upholding the CIT(A)'s findings.

The Tribunal affirmed the CIT(A)'s finding that the purchases were bogus, based on verification reports and postal returns. It also upheld the CIT(A)'s decision to sustain an addition of 12.5% of the disputed purchases, citing High Court judgments.

The Tribunal held that Section 14A read with Rule 8D is not applicable to the business of trading in shares and securities. Therefore, the disallowance made by the AO was deleted.

The Tribunal held that the share of income from the AOP, which was not taxable under normal provisions due to Section 86, should not be taxed under Section 115JB (MAT provisions). The amendment inserting clause (iic) in Explanation 1 to Section 115JB was considered remedial and curative, thus retrospective.

The Tribunal held that the appeal was not maintainable as per CBDT Circular No. 21/2015, which sets a monetary limit of Rs. 10 lakhs for filing appeals. The circular is retrospective and applicable to pending appeals.

The Tribunal held that the appeal was not maintainable as per CBDT Circular No. 21/2015, which sets a monetary limit of Rs. 10 lakhs for filing appeals by the Revenue. The circular is retrospective and applicable to pending appeals.

The Tribunal confirmed the penalty under Section 271C for non-deduction/non-remittance of TDS due to lack of explanation from the assessee. However, it set aside the penalty under Section 272A(2)(c) for non-filing of TDS returns, considering non-remittance of TDS as a reasonable cause.

The Tribunal upheld the CIT(A)'s decision to tax only the profit element (12.5%) on alleged bogus purchases, as the assessee failed to establish a direct link between these purchases and sales. The appeal was dismissed.

The Tribunal held that depreciation is allowable if assets are kept ready for use, even if not actively used, and that repairs are not automatically disallowable due to trading operations. Regarding interest expenditure, it was found that borrowed funds were not used for share investments.

The Tribunal found the CIT(A)'s method of estimation to be arbitrary and contrary to Section 69 of the Act. The matter was restored to the AO for fresh adjudication based on available material and further evidence.

The Tribunal held that the statement of Mr. Mukesh Chokshi was a general statement and could not be corroborated by material evidence against the assessee. Relying on previous decisions with identical facts, the Tribunal found the share transactions to be genuine.

The Tribunal confirmed the penalty under Section 271C for non-deduction/non-remittance of TDS due to lack of explanation from the assessee. However, it set aside the penalty under Section 272A(2)(c) for non-filing of TDS returns, considering non-remittance of TDS as a reasonable cause.

The Tribunal held that the disallowance under Section 14A read with Rule 8D was not justified for certain assessment years as Rule 8D was prospective. For other years, the CIT(A)'s apportionment of expenses was found to be reasonable. The matter of interest under Section 234D was restored to the AO for verification.

The Tribunal held that the statement of Mr. Mukesh Chokshi was a general statement and could not be corroborated by material evidence against the assessee. Relying on previous decisions with identical facts, the Tribunal found the share transactions to be genuine.

The Tribunal upheld the CIT(A)'s order deleting the penalty. It relied on the Supreme Court's decision in CIT vs. Reliance Petroproducts (P.) Ltd., stating that making a claim not sustainable in law does not automatically amount to furnishing inaccurate particulars or concealment of income.

The Tribunal upheld the CIT(A)'s order deleting the penalty. It relied on the Supreme Court's decision in CIT vs. Reliance Petroproducts (P.) Ltd., stating that making a claim not sustainable in law does not automatically amount to furnishing inaccurate particulars or concealment of income.

The Tribunal held that the reopening of assessment for certain years was invalid due to being beyond the four-year period and based on a change of opinion. It also upheld the deletion of disallowances under Section 14A for several years, finding them unjustified.

The Tribunal held that the disallowance under Section 14A read with Rule 8D was not justified for certain assessment years as Rule 8D was prospective. For other years, the CIT(A)'s apportionment of expenses was found to be reasonable. The matter of interest under Section 234D was restored to the AO for verification.

The Tribunal held that payments for internet charges and purchase of off-the-shelf software do not fall under the definition of 'fees for technical services' as envisaged in Section 194J of the Act. Therefore, the assessee was not in default for not deducting TDS under Section 194J on these payments.

The Tribunal held that the disallowance under Section 14A read with Rule 8D was not justified for certain assessment years as Rule 8D was prospective. For other years, the CIT(A)'s apportionment of expenses was found to be reasonable. The matter of interest under Section 234D was restored to the AO for verification.

The Tribunal held that the disallowance under Section 14A read with Rule 8D was not justified for certain assessment years as Rule 8D was prospective. For other years, the CIT(A)'s apportionment of expenses was found to be reasonable. The matter of interest under Section 234D was restored to the AO for verification.

The Tribunal held that overseas dividend income, being taxable in India, should not be considered for calculating average investment. It also found that the assessee's interest-free funds far exceeded its investments, making disallowance of interest expenditure unnecessary.

The Tribunal held that the assessee was eligible for presumptive taxation under Section 44AF. It also applied the 'Peak Credit' theory, limiting any addition to the peak credit in the cash account.

The Tribunal held that the income earned from hiring out vessels for offshore oil and gas activities qualifies for assessment under Section 44BB of the Income Tax Act, even if the assessee is a 'second leg' contractor. The Tribunal also affirmed the deletion of interest under Section 234B.

The Tribunal held that since the assessee had not started its business activities and the premises were leased out to an educational institution for a purpose unrelated to the assessee's business, the rent received is assessable as income from house property. The appeal was dismissed.

The Tribunal held that the disallowance under Section 14A read with Rule 8D was not justified for certain assessment years as Rule 8D was prospective. For other years, the CIT(A)'s apportionment of expenses was found to be reasonable. The matter of interest under Section 234D was restored to the AO for verification.

The Tribunal restored the transfer pricing issue to the AO for fresh analysis using TNMM. The addition on account of waiver of principal loan was allowed as a capital receipt. Grounds related to interest disallowance and Section 14A were not pressed.

The Tribunal held that a wrong claim, even if not accepted by the revenue, does not automatically attract penalty under Section 271(1)(c) if all facts were disclosed. The penalty was directed to be deleted.

The Tribunal held that the matter should be remanded to the AO for re-examination of the relationship between the expenditure and its disallowability under the head 'income from house property'. If the AO finds the expenses unrelated to property income, they should not be disallowed.

The Tribunal held that the disallowance under Section 14A read with Rule 8D was not justified for certain assessment years as Rule 8D was prospective. For other years, the CIT(A)'s apportionment of expenses was found to be reasonable. The matter of interest under Section 234D was restored to the AO for verification.

The Tribunal held that Pooja/function expenses, consultancy charges, and service charges were revenue in nature and allowable, following previous decisions. Gujarat Earthquake relief expenses were also allowed as community welfare expenses. The inclusion of sales tax and excise duty in turnover for Section 80HHC was decided in favour of the assessee.

The Tribunal upheld the CIT(A)'s direction to compute the capital gain after considering the DVO's report, finding no factual or legal infirmity. The assessee failed to produce evidence that the consideration was paid to the owners.

The Tribunal held that the assessee's claim was not disputed and that the revenue should not take advantage of an assessee's ignorance. The matter was restored to the AO for verifying the re-computation and claim.

The Tribunal held that the CIT(A) was correct in deleting the disallowance made by the AO. It noted that the assessee held shares as stock-in-trade, and in such cases, no disallowance under Section 14A is to be made if the shares are part of stock-in-trade. The AO had also not recorded dissatisfaction with the assessee's own disallowance.

The Tribunal found that the investigation by the revenue authorities was incomplete. Therefore, the matter was remanded to the AO for a deeper investigation into the source of the cash deposits and to examine Shri Ranka.

The Tribunal held that commission paid to non-resident agents for procuring export orders outside India, without any services rendered in India, is not taxable in India. Consequently, no TDS was required to be deducted under Section 195, and no disallowance under Section 40(a)(i) was warranted.

The Tribunal held that commission paid to non-resident agents for procuring export orders outside India, without any services rendered in India, is not taxable in India. Consequently, no TDS was required to be deducted under Section 195, and no disallowance under Section 40(a)(i) was warranted.

The Tribunal held that disallowing a deduction under Section 80IB merely because the return was filed belatedly (under Section 139(4)) is not permissible under Section 143(1) as it is a debatable issue. The disallowance made by the AO was beyond the scope of Section 143(1).

The Tribunal found a need to examine the facts more closely, particularly regarding the nature of the banks involved and to compare them with the Bangalore Club judgment. Therefore, the issue was remanded for fresh adjudication.

The Tribunal held that the assessee failed to provide material evidence to counter the findings of the CIT(A). The CIT(A) had upheld the addition made by the AO, considering the information obtained during a search operation and the nature of transactions.

The Tribunal held that the assessee's admission of the disallowances was not voluntary and occurred only after the AO's inquiry. The Tribunal found that the assessee had furnished inaccurate particulars of income and upheld the penalty imposed.

The Tribunal noted that the issue of deferred maintenance charges was identical to the assessee's own case for prior assessment years. Following the previous order, the Tribunal allowed the assessee's appeal for statistical purposes.

The Tribunal held that the commission expenditure was allowable, following its own prior decision for earlier assessment years. It also found that the retrospective amendment to Section 9 by the Finance Act, 2010, did not create an obligation to deduct TDS on the date of payment, making Section 40(a)(i) inapplicable.

The Tribunal held that Pooja/function expenses, consultancy charges, and service charges were revenue in nature and allowable, following previous decisions. Gujarat Earthquake relief expenses were also allowed as community welfare expenses. The inclusion of sales tax and excise duty in turnover for Section 80HHC was decided in favour of the assessee.

The Tribunal held that the services provided by stock exchanges for which TCs are paid do not qualify as 'technical services' as per Explanation 2 to Section 9(1)(vii) of the Act. Therefore, the assessee was not liable to deduct tax at source.

The Tribunal restored the transfer pricing issue to the AO for fresh analysis using TNMM. The addition on account of waiver of principal loan was allowed as a capital receipt. Grounds related to interest disallowance and Section 14A were not pressed.