ITAT Mumbai Judgments — April 2017

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

The Tribunal held that Rule 8D was not applicable for AY 2007-08. It also held that disallowance under Section 14A should not exceed the exempt income earned. A reasonable disallowance of Rs. 25,000 was allowed.

The Tribunal held that the ends of justice would be met by giving the assessee one more opportunity to submit additional evidence before the CIT(A). The CIT(A)'s order was set aside, and the appeals were restored to the CIT(A)'s file for a decision on merits after considering the additional evidence.

The Tribunal found merit in the assessee's claim that the TDR was brought in as capital contribution and treated as stock. However, due to lack of evidence before the lower authorities, the case was remanded to the AO for fresh consideration.

The Tribunal held that the search and seizure action was not conducted at the business premises of the assessee firm, but at the residential premises of its partners. No incriminating material relating to the assessee was found. Therefore, proceedings under Section 153A were not validly initiated against the assessee.

The Tribunal confirmed the penalty for bogus purchases, finding them unsubstantiated. However, it deleted the penalty for labor payments, considering the assessee had discharged the initial onus and made payments through banking channels after deducting TDS.

The Tribunal held that the search and seizure action was not conducted at the business premises of the assessee firm, but at the residential premises of its partners. No incriminating material relating to the assessee was found. Therefore, proceedings under Section 153A were not validly initiated against the assessee.

The Tribunal held that the search and seizure action was not conducted at the business premises of the assessee firm, but at the residential premises of its partners. No incriminating material relating to the assessee was found. Therefore, proceedings under Section 153A were not validly initiated against the assessee.

The Tribunal held that the ends of justice would be met by giving the assessee one more opportunity to submit additional evidence before the CIT(A). The CIT(A)'s order was set aside, and the appeals were restored to the CIT(A)'s file for a decision on merits after considering the additional evidence.

The Tribunal found no valid reason to interfere with the CIT(A)'s decision to estimate gross profit. However, considering the totality of facts, the Tribunal deemed a gross profit estimation of 3.25% to be reasonable.

The Tribunal dismissed the grounds related to protective additions as infructuous. It restored the issue of architect fees to the AO for fresh verification. The Revenue's grounds regarding additional depreciation and Section 80IB(10) were dismissed, while grounds concerning unexplained expenditure and bogus purchases were also dismissed.

The Tribunal held that the penalty appeal should also be restored to the Assessing Officer, as the penalty's outcome depends on the quantum addition. The assessee is to be given an opportunity to be heard and furnish evidence.

The Tribunal held that the CIT(A) erred in restricting the addition to Rs. 1,96,00,000 when the assessee failed to prove the genuineness of the entire Rs. 4,00,00,000 share capital increase. The matter was remanded back to the AO for fresh adjudication.

The tribunal held that the deduction under Section 35(1)(iii) is not allowable as the foundation was not approved. The matter was restored to the AO to verify eligibility for deduction under Section 80G.

The Tribunal held that depreciation is not allowable on assets whose income is offered under 'Income from House Property' and standard deduction is claimed. However, it upheld the CIT(A)'s deletion of proportionate disallowance of expenses related to leased property, finding that the assessee maintained separate accounts for such expenses.

The Tribunal held that the issue of bad debts had been decided in favour of the assessee in previous assessment years by the Tribunal itself, following the Bombay High Court's decision in the Shreyas S. Morakhia case. Therefore, the disallowance was incorrect.

The Tribunal held that the CIT(A) erred in restricting the addition to Rs. 1,96,00,000 when the assessee failed to prove the genuineness of the entire Rs. 4,00,00,000 share capital increase. The matter was remanded back to the AO for fresh adjudication.

The Tribunal held that exemption under Section 54F is allowable only to the extent of investment made in the new asset before the due date of filing the return. Unutilized amounts not deposited in the specified account before the due date are not eligible for exemption.

The Tribunal dismissed the grounds related to protective additions as infructuous. It restored the issue of architect fees to the AO for fresh verification. The Revenue's grounds regarding additional depreciation and Section 80IB(10) were dismissed, while grounds concerning unexplained expenditure and bogus purchases were also dismissed.

The Tribunal held that the CIT(A) erred in accepting certificates from non-competent authorities and admitting additional evidence without a remand report from the AO. The matter was remanded to the AO for de-novo assessment.