ITAT Mumbai Judgments — July 2022

The Tribunal held that the disallowance of deduction under section 80P was not valid. It reasoned that section 80A(5) and section 80AC were not applicable for the assessment years in question, and the Assessing Officer lacked the power under section 143(1) to disallow such deductions prior to April 1, 2021.

The Tribunal held that the allowability of the cost of construction was never an issue before the High Court or the Tribunal in previous proceedings. The Assessing Officer improperly raised this issue while giving effect to the High Court's order.

The Tribunal held that the disallowance of deduction under section 80P was not valid. It reasoned that section 80A(5) and section 80AC were not applicable for the assessment years in question, and the Assessing Officer lacked the power under section 143(1) to disallow such deductions prior to April 1, 2021.

The Tribunal held that the disallowance of deduction under section 80P was not permissible under section 143(1) for the assessment years in question. Sections 80A(5) and 80AC were also found not applicable to the assessee's case.

The Tribunal held that the reopening under Section 147 was bad in law as the AO's reasons were based on incorrect assumptions and there was no escapement of income. Consequently, the proceedings initiated under Section 147 were quashed.

The Tribunal held that the Pr.CIT erred in initiating revision proceedings under Section 263. The AO had conducted adequate inquiries and was satisfied with the assessee's submissions regarding the property valuation, making the assessment order neither erroneous nor prejudicial to revenue.

The Tribunal, considering the assessee's undertaking and difficult circumstances, decided to remit the matter back to the CIT(A) for fresh adjudication. The assessee was granted one more opportunity to be heard, with a caution for future compliance.

The Tribunal, considering the assessee's undertaking and difficult circumstances, decided to remit the matter back to the CIT(A) for fresh adjudication. The assessee was granted one more opportunity to be heard, with a caution for future compliance.

The Tribunal, considering the assessee's undertaking and difficult circumstances, decided to remit the matter back to the CIT(A) for fresh adjudication. The assessee was granted one more opportunity to be heard, with a caution for future compliance.

The Tribunal, considering the assessee's undertaking and difficult circumstances, decided to remit the matter back to the CIT(A) for fresh adjudication. The assessee was granted one more opportunity to be heard, with a caution for future compliance.

The Tribunal held that the customs duty paid on the yacht was allowable as a business expense. It also confirmed that the profit on the helicopter transfer should be treated as long-term capital gain, not short-term.

The Tribunal held that no proceedings could be continued against the corporate debtor during the moratorium period. Therefore, the appeals filed by the Revenue were dismissed.

The Tribunal held that the CIT(A) has a statutory obligation to dispose of an appeal on merits, even if the assessee does not appear. The CIT(A) cannot summarily dismiss an appeal without adjudicating on the grounds raised.

The Tribunal held that Section 11(1A) is applicable only if a new capital asset is purchased from the sale consideration of the old asset. Since it was unclear if the assessee purchased a new asset, the matter was set aside for fresh examination by the CIT(A).

The Tribunal held that while the deduction under Section 80IA might not be available, the claim was made in bonafide belief and supported by judicial precedents. Furthermore, a defect in the penalty notice vitiated the proceedings.

The Tribunal found contradictions and lack of proper documentation regarding both the cash deposit addition and the commission income addition. Therefore, both issues were set aside and restored to the CIT(A) for fresh examination.

The Tribunal held that there was no material to suggest PANs were obtained after payment. It also noted that furnishing PAN of deductees in Form 26Q became mandatory only from 19.02.2013, and for the AY under consideration, it was not mandatory.

The Tribunal condoned the delay in filing the appeal. It was found that there was no proof of service of notice under Section 143(2) of the Income Tax Act, which is essential for the Assessing Officer to gain jurisdiction. Therefore, the assessment order was quashed.

The Tribunal held that purchases cannot be rejected without disturbing the sales. Following jurisdictional High Court and ITAT decisions, the addition was restricted to the extent of bringing the gross profit rate on disputed purchases to the same rate as other genuine purchases.

The Tribunal held that natural justice requires the assessee to be heard. Therefore, the order of the CIT(A) was set aside, and the issues were restored to his file for fresh examination after providing the assessee an adequate opportunity to be heard.

The Tribunal held that Section 41(1) applies only when there is remission or cessation of liability. Since the assessee consistently acknowledged the liability in its books and there was no evidence of remission, the addition was not justified.

The Tribunal quashed the reopening of assessment, finding it lacked valid grounds and tangible material. On the merits, it upheld the CIT(A)'s deletion of the disallowance for weighted deduction under Section 35(2AB), agreeing that contract research income should not be reduced from eligible R&D expenses in this manner.

The Tribunal upheld the order of the CIT(A), finding that the CIT(A) had taken a reasonable view by estimating the profit element at 4% of the bogus purchases. The Tribunal found no infirmity in the CIT(A)'s order.

The Tribunal partly allowed the assessee's appeal, specifically remanding issues related to set-off of capital loss and TDS credit. The Revenue's appeal was dismissed.

The Tribunal held that interest received on delayed compensation should be taxed as 'Income from Other Sources', while compensation received up to the date of land acquisition should be taxed under 'Capital Gains'. The Tribunal also upheld the deduction of 50% on income taxable under Section 56(2)(viii) and confirmed the CIT(A)'s findings on Section 54F.

The ITAT condoned the delay in filing the appeal and set aside the CIT(A)'s order. The tribunal decided to provide the assessee with another opportunity to present their case before the CIT(A) for a fresh adjudication.

The Tribunal quashed the reopening of assessment, finding it lacked valid grounds and tangible material. On the merits, it upheld the CIT(A)'s deletion of the disallowance for weighted deduction under Section 35(2AB), agreeing that contract research income should not be reduced from eligible R&D expenses in this manner.

The Tribunal partly allowed the assessee's appeal, specifically restoring issues related to set-off of capital loss and TDS credit to the Assessing Officer for fresh verification. The Revenue's appeal was dismissed.

The Tribunal quashed the reopening of assessment, finding it lacked valid grounds and tangible material. On the merits, it upheld the CIT(A)'s deletion of the disallowance for weighted deduction under Section 35(2AB), agreeing that contract research income should not be reduced from eligible R&D expenses in this manner.

The Tribunal condoned the delay in the assessee's appeal. It upheld the CIT(A)'s decision to exclude training fees from total turnover for Section 10A deduction, following Supreme Court precedent. The Tribunal also upheld the CIT(A)'s decision to allow setting off losses of one unit against profits of another for Section 10A deduction, also following Supreme Court precedent.

The Tribunal held that the assessee is eligible for exemption under Section 11 and 12 of the Act, following previous decisions in the assessee's own case. However, the issue regarding the pending application under Section 10(23C)(vi) was set aside to the AO for fresh adjudication after pursuing the matter with the CBDT.

The Tribunal allowed grounds related to transfer pricing adjustments for charter hire of dredgers and taxability of management service fees and salary reimbursements, following its own prior rulings. Grounds not adjudicated by the DRP were restored to the DRP.

The Tribunal held that for AY 2007-08, additions under Section 153A were invalid without incriminating material as it was a concluded assessment. For AY 2009-10, certain additions were subsumed within the estimated net profit, and an addition on account of interest-free loans was deleted.

The Tribunal accepted the assessee's alternative submission that the payments were for works contract, not technical services. It restored the issue to the AO to examine the proviso to Section 201(1) regarding the recipient having offered the income and paid tax.

The Tribunal upheld the CIT(A)'s decision, finding that the assessee had provided sufficient evidence, including ITR acknowledgments, bank statements, and invoices, to establish the genuineness of the unsecured loans and purchases. The non-response of third parties to Section 133(6) notices was not held against the assessee.

The Tribunal held that the adjustment made under section 143(1) by disallowing the cost of acquisition was beyond the scope of permissible adjustments. The lack of proper intimation to the assessee before making such an adjustment vitiated the entire process.

The Tribunal held that for AY 2007-08, additions under Section 153A were invalid without incriminating material as it was a concluded assessment. For AY 2009-10, certain additions were subsumed within the estimated net profit, and an addition on account of interest-free loans was deleted.

The Tribunal held that the assessee had discharged the primary onus by providing evidence of identity, genuineness, and creditworthiness of the lenders. Following a coordinate bench's decision in the assessee's own case, the Tribunal found no infirmity in the CIT(A)'s order deleting the addition.

The Tribunal held that the assessee had discharged the primary onus by providing evidence of identity, genuineness, and creditworthiness of the lenders. Following a coordinate bench's decision in the assessee's own case, the Tribunal found no infirmity in the CIT(A)'s order deleting the addition.

The Tribunal held that the reopening was valid as the assessee failed to disclose material facts regarding prior year assessments. The CIT(A) erred in quashing the reassessment proceedings.

The Tribunal held that expenses incurred to protect a business asset are deductible as business expenses, even if no project was in progress. The mere fact that no business activity was carried out in the relevant year does not affect deductibility if the business is deemed to be continuing.

The Tribunal held that the assessee had discharged the primary onus by providing evidence of identity, genuineness, and creditworthiness of the lenders. Following a coordinate bench's decision in the assessee's own case, the Tribunal found no infirmity in the CIT(A)'s order deleting the addition.

The Tribunal condoned the delay in the assessee's appeal. It upheld the CIT(A)'s decision to exclude training fees from total turnover for Section 10A deduction, following Supreme Court precedent. The Tribunal also upheld the CIT(A)'s decision to allow setting off losses of one unit against profits of another for Section 10A deduction, also following Supreme Court precedent.

The Tribunal upheld the CIT(A)'s decision, finding that the assessee had provided sufficient evidence, including ITR acknowledgments, bank statements, and invoices, to establish the genuineness of the unsecured loans and purchases. The non-response of third parties to Section 133(6) notices was not held against the assessee.

The Tribunal held that the disallowance made by the CPC under Section 143(1) was incorrect as the employee contributions were deposited before the due date of filing the return. The amendments by the Finance Act, 2021, were not applicable retrospectively to the assessment year in question.

The Tribunal held that the adjustment under section 143(1) was not justified. It emphasized that payments made before the income tax return filing date are deductible, as per jurisdictional High Court judgments, and a tax auditor's report does not bind the assessee for such disallowances at the processing stage.

The Tribunal held that the TPO failed to adopt prescribed methods for determining ALP and that the assessee's benchmarking was more acceptable. For foreign travel expenses, the AO was directed to verify if fringe benefit tax was paid to allow the claim.

The ITAT held that the CIT(A) should have condoned the delay, considering the change of tax consultant and the assessee's health issues. The tribunal emphasized a lenient approach for ordinary taxpayers and remitted the matter back to the CIT(A) for a decision on merits.

The Tribunal held that the show cause notice for penalty was vague and defective as it did not specify the limb of section 271(1)(c) applicable to each addition and failed to strike off inapplicable portions. This vitiated the penalty proceedings.

The Tribunal held that the show cause notice for penalty was vague and defective as it did not specify the limb of section 271(1)(c) (concealment of income or furnishing inaccurate particulars) for each addition and did not strike off the inapplicable portion. This vitiated the penalty proceedings.