ITAT Mumbai Judgments — July 2018

The Tribunal, noting identical facts to a previous assessment year, restored the issue to the AO. The AO is directed to re-examine the rent expenditure based on the Tribunal's prior order.

The Tribunal held that as per CBDT Circular No. 3/2018, appeals with a tax effect below Rs. 20 lakhs are not maintainable. Therefore, the appeal filed by the Revenue was dismissed.

The Tribunal held that addition under section 41(1) cannot be made when income is offered on a presumptive basis under section 44AD and no allowance or deduction was claimed for the liability. The Tribunal also noted that the department had accepted similar claims in earlier assessment years.

The Tribunal partly allowed the appeal regarding the addition on gross profit, reducing the estimated GP to 0.7% above the declared GP. For the commission addition, it was reduced to 0.3% from the AO's estimation of 0.5%.

The Tribunal held that the appeal was barred by monetary limitation as per CBDT Circular No. 03/2018. The tax effect was below the prescribed limit of Rs. 20.00 lacs.

The Tribunal restored the issues of unsecured loans and freight expenses to the Assessing Officer for fresh examination, granting the assessee an opportunity to provide further details. The addition related to other expenses was confirmed as the assessee did not press the issue.

The Tribunal dismissed the revenue's appeal in limine as the tax effect was below the threshold specified in CBDT Circular No. 3/2018. The assessee did not press their cross-objection.

The Tribunal held that the issue of disallowance of provision for leave encashment under Section 43B(f) was debatable and not a mistake apparent from the record. Therefore, rectification under Section 154 was not permissible.

The Tribunal found that the assessee submitted evidence before the CIT(A) which was not produced before the AO. To allow the AO to examine these evidences, the Tribunal restored the issue to the AO's file for fresh adjudication.

The Tribunal upheld the addition of profit at 12.5% on bogus purchases, confirming the lower authorities' decision. The assessee's inability to prove the genuineness of purchases and the admission of seller parties led to the inference of grey market purchases and inflated profits.

The Tribunal found no merit in the assessee's appeal as no evidence or explanation was provided for the claimed additional expenses. The lower authorities' disallowance was therefore upheld.

The Tribunal partly allowed the appeal regarding the addition on gross profit, reducing the estimated GP to 0.7% above the declared GP. For the commission addition, it was reduced to 0.3% from the AO's estimation of 0.5%.

The Tribunal partly allowed the appeal regarding the addition on gross profit, reducing the estimated GP to 0.7% above the declared GP. For the commission addition, it was reduced to 0.3% from the AO's estimation of 0.5%.

The Tribunal found that the CIT(A) had dismissed the appeal by relying on a previous year's order and without considering the evidence filed by the assessee. Therefore, the issue was restored to the file of the AO for a fresh decision.

The Tribunal found that there was a contradiction regarding the evidence filed by the assessee for expenses. Therefore, the issue of disallowance of expenses was set aside and remanded back to the Assessing Officer for re-examination.

The Tribunal found that the 20% disallowance was still on the higher side. Therefore, it reduced the ad hoc disallowance to 10% for all the disputed expenses, acknowledging the possibility of leakage due to self-made vouchers.

The Tribunal dismissed the revenue's appeal in limine as the tax effect was below the threshold specified in CBDT Circular No. 3/2018. The revenue was granted liberty to move a miscellaneous application if the issue fell under exceptions in the circular.

The Tribunal dismissed the assessee's appeals as no material was furnished to contradict the CIT(A)'s findings. The assessee also failed to appear for hearings, leading to an ex-parte decision.

The Tribunal held that since the commission paid to foreign agents was for services rendered outside India and not taxable in India, there was no obligation to deduct TDS. Consequently, the disallowance under Section 40(a)(i) was not justified.

The Tribunal held that rental income from a property being developed by a builder and developer should be treated as business income and reduced from work-in-progress, not as income from house property. The Tribunal also noted that the AO's calculation of income from the assignment of development rights was based on an agreement and required further examination.

The Tribunal confirmed the CIT(A)'s decision regarding realized gains, following earlier coordinate bench rulings. For unrealized gains, the matter was remanded to the Assessing Officer for verification of their relation to asset acquisition for the power plant.

The Tribunal held that the liability to pay dividend distribution tax arises upon the declaration of dividend. Therefore, the tax rate applicable for the financial year in which the dividend was declared should be applied.

The Tribunal held that the payment received for the supply of software was for a copyrighted article and not for the use of copyright, thus not royalty under Section 9(1)(vi) or Article 12 of the DTAA. The Tribunal also directed the AO to grant credit for TDS.

The Tribunal held that the CIT(A) was justified in deleting the addition. The Tribunal found that the assessee had provided sufficient evidence regarding the identity, creditworthiness, and genuineness of the transactions, and that the income-tax particulars of the subscribers were known to the Department.

The Tribunal held that the assessee had provided sufficient documents, including bank remittances, RBI correspondence, and KYC of the investor company, to establish the identity, genuineness, and creditworthiness of the transaction. Therefore, the addition made by the Assessing Officer was deleted.

The Tribunal held that the assessee had provided sufficient documents, including bank remittances, RBI correspondence, and KYC of the investor company, to establish the identity, genuineness, and creditworthiness of the transaction. Therefore, the addition made by the Assessing Officer was deleted.

The Tribunal held that the assessee had provided sufficient documents, including bank remittances, RBI correspondence, and KYC of the investor company, to establish the identity, genuineness, and creditworthiness of the transaction. Therefore, the addition made by the Assessing Officer was deleted.

The Tribunal held that the assessee had provided sufficient documents, including bank remittances, RBI correspondence, and KYC of the investor company, to establish the identity, genuineness, and creditworthiness of the transaction. Therefore, the addition made by the Assessing Officer was deleted.

The Tribunal held that while the assessee failed to fully discharge the onus of proving transactions, the CIT(A) erred in shifting the entire onus to the AO. The Tribunal enhanced the profit element on alleged bogus purchases to 4% from the 1.77% estimated by the CIT(A).

The Tribunal held that while the assessee failed to fully discharge the onus of proving transactions, the CIT(A) erred in shifting the entire onus to the AO. The Tribunal enhanced the profit element on alleged bogus purchases to 4% from the 1.77% estimated by the CIT(A).

The Tribunal held that the land sold was not agricultural land and thus the profit was taxable as short-term capital gain. However, the deduction for interest on the housing loan was allowed in full as the property was let out.

The Tribunal held that interest income earned from loans given and FDRs should be allowed to be netted off against interest expenses, treating it as business income. For other expenses, the matter was restored to the Assessing Officer for fresh consideration.

The Tribunal dismissed the appeal filed by the Revenue. The Tribunal noted that the jurisdictional High Court, in cases like Green Infra Ltd. and Gagandeep Infrastructure Ltd., had deliberated on Section 68 and the retrospective applicability of its proviso. It was held that the proviso to Section 68, introduced by the Finance Act, 2012, effective from 01/04/2013, would only apply from Assessment Year 2013-14 onwards and not to earlier assessment years. The High Court had also affirmed that the legislature did not intend the proviso to be retrospective or declaratory. The Tribunal found that the assessee had discharged its onus by establishing identity, genuineness, and capacity. The issue of heavy premium was considered a prerogative of the Board of Directors and shareholders' wisdom, which revenue authorities cannot question. The Tribunal found no evidence from the Revenue to suggest the transaction was sham and respectfully followed the decisions of the jurisdictional High Court, affirming the FAA's order.

The Tribunal upheld the CIT(A)'s decision, finding that the assessee had discharged its onus under Section 68 by providing details of the investor and transaction. The Tribunal also affirmed the deletion of interest disallowance due to factual discrepancies and lack of evidence from the AO.

The Tribunal held that the addition was only due to a mismatch in AIR data which was a matter of reconciliation and the data in Form 26AS was modified in later financial years. Therefore, the penalty could not be sustained.

The Tribunal held that while the assessee failed to prove the purchases, the entire disallowance was not justified given the nature of the business and the high profit rate it would imply. Therefore, the addition was restricted to the profit element embedded in the purchases.

The Tribunal held that revenue from repair services provided by the assessee outside India to ONGC was not taxable in India as it did not 'make available' technical knowledge as per the India-Australia DTAA, nor was it attributable to a Permanent Establishment in India.

The Tribunal held that the addition should be restricted to the profit element of the bogus purchases. Following the Gujarat High Court's decision in CIT Vs. Simit P. Sheth, the addition was restricted to 12.5% of the bogus purchase value.

The Tribunal noted that the quantum addition of Rs. 1,43,000/- had been set aside to the Assessing Officer for fresh adjudication. Consequently, the penalty imposed under Section 271(1)(c) was also set aside to the Assessing Officer for re-adjudication.

The Tribunal upheld the CIT(A)'s estimation of 8% on bogus purchases and deletion of addition on closing stock valuation. However, it partly allowed the Revenue's appeal by confirming a 20% disallowance of sales promotion expenses.

The Tribunal held that the assessee had discharged its onus under Section 68 by satisfactorily explaining the nature and source of credits, including identity, creditworthiness, and genuineness of the transaction. The addition made by the Assessing Officer was based on an FIPB application rejection, which was not sufficient to disprove the assessee's explanation.

The Tribunal held that the CIT(A) was correct in deleting the additions made by the Assessing Officer. The Tribunal found that the assessee had provided sufficient evidence of commencing business activity through R&D and that the assets were used for this purpose, even without revenue generation.

The Tribunal held that journal entries for assigning debts and liabilities among sister concerns and reimbursement of expenses do not constitute acceptance of loans or deposits under Section 269SS. Following various High Court and Supreme Court decisions, the Tribunal found no infirmity in the deletion of penalties.

The Tribunal held that journal entries for assigning debts and liabilities among sister concerns and reimbursement of expenses do not constitute acceptance of loans or deposits under Section 269SS. Following various High Court and Supreme Court decisions, the Tribunal found no infirmity in the deletion of penalties.

The Tribunal held that journal entries for assigning debts and liabilities among sister concerns and reimbursement of expenses do not constitute acceptance of loans or deposits under Section 269SS. Following various High Court and Supreme Court decisions, the Tribunal found no infirmity in the deletion of penalties.

The Tribunal held that journal entries for assigning debts and liabilities among sister concerns and reimbursement of expenses do not constitute acceptance of loans or deposits under Section 269SS. Following various High Court and Supreme Court decisions, the Tribunal found no infirmity in the deletion of penalties.

The Tribunal held that journal entries for assigning debts and liabilities among sister concerns and reimbursement of expenses do not constitute acceptance of loans or deposits under Section 269SS. Following various High Court and Supreme Court decisions, the Tribunal found no infirmity in the deletion of penalties.

The Tribunal held that journal entries for assigning debts and liabilities among sister concerns and reimbursement of expenses do not constitute acceptance of loans or deposits under Section 269SS. Following various High Court and Supreme Court decisions, the Tribunal found no infirmity in the deletion of penalties.

The Tribunal upheld the CIT(A)'s decision to delete the addition, finding that the Assessing Officer failed to conduct independent investigation and did not provide crucial evidence like the statement of the informant to the assessee. The assessee had provided documentary evidence of the loans, including bank statements and interest payments.

The Tribunal held that the remittances constituted business profits in the hands of Kotak UK. Since Kotak UK did not have a Permanent Establishment in India, these profits were not taxable in India as per Article 7 of the India-UK DTAA.