ITAT Mumbai Judgments — March 2017

The Tribunal held that transaction charges paid to the stock exchange are for facilities provided, not technical services. Therefore, TDS under Section 194J was not deductible, and consequential interest under Section 201(1A) was also deleted.

The Tribunal held that transaction charges paid to the stock exchange are for facilities provided, not technical services. Therefore, TDS under Section 194J was not deductible, and consequential interest under Section 201(1A) was also deleted.

The Tribunal held that if an assessee fails to maintain books of accounts, the offense under section 271A is complete, and consequently, the penalty for not getting accounts audited under section 271B is not attracted. The penalty under section 271A was upheld, while the penalty under section 271B was deleted.

The Tribunal held that the interest subsidy received under the TUFS scheme is a capital receipt, following previous judgments from the Supreme Court, Punjab & Haryana High Court, and its own benches. Therefore, the addition made by the Assessing Officer was deleted.

The Tribunal held that bad debts and losses arising from client transactions in share broking are allowable deductions, following previous High Court and Tribunal decisions. It also restored certain disallowances related to Section 14A to the Assessing Officer for fresh adjudication.

The Tribunal upheld the CIT(A)'s decision that gains from cancelling forward foreign exchange contracts are to be treated as capital gains. Consequently, the assessee is entitled to set off these gains against brought forward capital losses.

The Tribunal held that to treat the payer as an assessee in default, the income paid to the payee must be capable of being brought within the tax net and lawfully assessed on the payee. Since no action was taken against the payee and the time limit for such action had expired, the assessee could not be treated as an assessee in default.

The Tribunal upheld the CIT(A)'s decision, finding that the assessee had properly reconciled the differences between unaudited and audited accounts, and the department failed to provide contrary evidence. The Tribunal also noted the assessee had declared additional income.

The Tribunal held that the CIT's order under Section 263 was invalid and could not be endorsed on merits. The AO's order was considered debatable and not erroneous, especially considering prior tribunal rulings and Supreme Court judgments. The Tribunal also noted procedural irregularities in the CIT's order.

The Tribunal held that to treat the payer as an assessee in default, the income paid to the payee must be capable of being brought within the tax net and lawfully assessed on the payee. Since no action was taken against the payee and the time limit for such action had expired, the assessee could not be treated as an assessee in default.

The Tribunal held that the loss on valuation of closing stock of shares was not speculative loss but a business loss, following the exception to Section 73. Consequently, the penalty levied was also deleted.

The Tribunal held that if an assessee fails to maintain books of accounts, the offense under section 271A is complete, and consequently, the penalty for not getting accounts audited under section 271B is not attracted. The penalty under section 271A was upheld, while the penalty under section 271B was deleted.

The Tribunal held that Article 24 of the DTAA is not applicable in this case as the income earned by the assessee on the sale of debt instruments is not taxable in India as per Article 13(4) of the Treaty. Therefore, the requirement of remittance to Singapore is irrelevant.

The Tribunal held that if an assessee fails to maintain books of accounts, the offense under section 271A is complete, and consequently, the penalty for not getting accounts audited under section 271B is not attracted. The penalty under section 271A was upheld, while the penalty under section 271B was deleted.

The Tribunal held that if an assessee fails to maintain books of accounts, the offense under section 271A is complete, and consequently, the penalty for not getting accounts audited under section 271B is not attracted. The penalty under section 271A was upheld, while the penalty under section 271B was deleted.

The Tribunal held that while the identity of the creditor was proved, the assessee could not furnish all the requested documents like the creditor's bank statement due to strained relations. However, the Tribunal found that the assessee had produced available material and the creditor was not a stranger, thus the loan could not be treated as unexplained.

The Tribunal acknowledged the assessee's inability to produce books of account, attributing it to potential destruction. However, considering the net profit rates in preceding and subsequent years, the Tribunal fixed the net profit at 7.5% of gross receipts.

The Tribunal held that losses incurred prior to the initial assessment year chosen for claiming deduction under Section 80IA are not required to be notionally carried forward and adjusted. The Special Bench decision relied upon by the AO was not applicable due to amendments in Section 80IA.

The Tribunal held that the AO failed to provide evidence for the alleged 'on money' and did not consider valid reasons for price variations, such as concessions to existing members. The Tribunal confirmed the CIT(A)'s deletion of the addition.

The Tribunal held that if an assessee fails to maintain books of accounts, the offense under section 271A is complete, and consequently, the penalty for not getting accounts audited under section 271B is not attracted. The penalty under section 271A was upheld, while the penalty under section 271B was deleted.

The Tribunal held that if an assessee fails to maintain books of accounts, the offense under section 271A is complete, and consequently, the penalty for not getting accounts audited under section 271B is not attracted. The penalty under section 271A was upheld, while the penalty under section 271B was deleted.

The Tribunal held that the nature of the transaction in the hands of the recipient does not determine the allowability of expenditure in the hands of the lender. Advances made for running the business of the assessee have to be allowed as business loss or expenditure.

The Tribunal held that if an assessee fails to maintain books of accounts, the offense under section 271A is complete, and consequently, the penalty for not getting accounts audited under section 271B is not attracted. The penalty under section 271A was upheld, while the penalty under section 271B was deleted.

The Tribunal upheld the FAA's decision to restrict the addition to 8% of the purchases, finding that while the suppliers might be bogus, the assessee's books were not rejected and the work was executed for government agencies. Therefore, 100% addition was not justified.

The Tribunal held that if an assessee fails to maintain books of accounts, the offense under section 271A is complete, and consequently, the penalty for not getting accounts audited under section 271B is not attracted. The penalty under section 271A was upheld, while the penalty under section 271B was deleted.

The Tribunal held that if an assessee fails to maintain books of accounts, the offense under section 271A is complete, and consequently, the penalty for not getting accounts audited under section 271B is not attracted. The penalty under section 271A was upheld, while the penalty under section 271B was deleted.

The Tribunal held that the STCG earned by the assessee should be treated as capital gains and not business income. This decision was based on the consistency of treatment in previous and subsequent assessment years, the assessee's own capital investment, and the nature of transactions.

The Tribunal held that the CIT(A) failed to consider the assessee's arguments and relevant case law regarding the capital gains claim. The CIT(A) also did not properly address the delay in filing the appeal.

The Tribunal found merit in the assessee's arguments regarding the calculation of average investments. The matter was remanded to the AO to reconsider the issue after providing the assessee with an opportunity to be heard.

The Tribunal held that the interest subsidy received under the TUFS scheme is a capital receipt, following previous judgments from the Supreme Court, Punjab & Haryana High Court, and its own benches. Therefore, the addition made by the Assessing Officer was deleted.

The Tribunal found merit in the assessee's arguments regarding the calculation of average investments. The matter was remanded to the AO to reconsider the issue after providing the assessee with an opportunity to be heard.

The Tribunal held that if an assessee fails to maintain books of accounts, the offense under section 271A is complete, and consequently, the penalty for not getting accounts audited under section 271B is not attracted. The penalty under section 271A was upheld, while the penalty under section 271B was deleted.

The Tribunal held that if an assessee fails to maintain books of accounts, the offense under section 271A is complete, and consequently, the penalty for not getting accounts audited under section 271B is not attracted. The penalty under section 271A was upheld, while the penalty under section 271B was deleted.

The Tribunal held that if an assessee fails to maintain books of accounts, the offense under section 271A is complete, and consequently, the penalty for not getting accounts audited under section 271B is not attracted. The penalty under section 271A was upheld, while the penalty under section 271B was deleted.

The Tribunal held that if an assessee fails to maintain books of accounts, the offense under section 271A is complete, and consequently, the penalty for not getting accounts audited under section 271B is not attracted. The penalty under section 271A was upheld, while the penalty under section 271B was deleted.

The Tribunal held that if an assessee fails to maintain books of accounts, the offense under section 271A is complete, and consequently, the penalty for not getting accounts audited under section 271B is not attracted. The penalty under section 271A was upheld, while the penalty under section 271B was deleted.

The Tribunal held that a reassessment order passed without disposing of the objections raised by the assessee against the reopening is bad in law. Therefore, the reassessment order is set aside.

The Tribunal held that fulfillment of export obligations results in a reduction of liability, which is deductible under the first proviso to Section 43B. Therefore, the customs duty liability adjusted against export obligations is deductible.

The Tribunal dismissed the departmental appeal, following its own earlier decision for the assessee's own case for AY 2009-10. The Tribunal held that ocean freight, air freight, and inland charges are covered by CBDT Circular No. 723, exempting them from TDS, and payments to shipping agents of non-residents are also covered by Section 172.

The Tribunal held that payments for acquiring a 'copyrighted article' (software as a product) are not royalty, unlike payments for the 'transfer of any right in a copyright'. Therefore, TDS was not required, and the disallowance under Section 40(a)(i) was incorrect.

The Tribunal held that repair and maintenance expenses are revenue in nature and allowed them as such. It also held that professional fees paid to the non-resident director were not taxable in India under the India-UK DTAA and allowed the disallowance to be cancelled.

The Tribunal restored the issue of commission expenses to the Assessing Officer for fresh examination. This decision was based on a previous ruling in the assessee's own case for a different assessment year.

The Tribunal held that the CIT cannot set aside an assessment order solely to direct the initiation of penalty proceedings. Following High Court decisions, the Tribunal ruled in favour of the assessee.

The Tribunal held that repair and maintenance expenses are revenue in nature and allowed them as such. It also held that professional fees paid to the non-resident director were not taxable in India under the India-UK DTAA and allowed the disallowance to be cancelled.

The Tribunal held that the reopening of assessments under Section 147 was bad in law. This was because the Assessing Officer had already examined the relevant facts and materials during the original assessment proceedings under Section 143(3), and there was no fresh tangible material to justify reopening.

The Tribunal held that an addition made by the AO based on the deeming provision of Section 50C, which relies on stamp duty valuation, does not automatically attract penalty under Section 271(1)(c). The addition alone does not conclusively prove the original sale consideration was incorrect.

The Tribunal held that merely making a claim that is not sustainable in law does not amount to furnishing inaccurate particulars of income. The assessee had disclosed the facts and the claim was made in the computation of income, not as a concealment. Therefore, the penalty was not leviable.

The Tribunal held that the appeal was not maintainable as per CBDT Circular No. 21/2015, which mandates that appeals with a tax effect below a certain limit should not be filed or should be withdrawn. The Revenue was granted liberty to seek recall if circumstances changed.

The Tribunal held that the reasons provided by the assessee for the delay, such as a director's personal issues, did not constitute a reasonable cause. The assessee, as a corporate entity, should have made arrangements to ensure timely compliance.