ITAT Mumbai Judgments — August 2022

The Tribunal held that the satisfaction note issued by the AO of the searched person was vitiated because it erroneously concluded that the seized ledger copies belonged to the assessee, when they were merely transactional records of the searched trust. Consequently, the assessment proceedings under Section 153C were void ab initio.

The Tribunal held that the satisfaction note issued by the AO of the searched person was vitiated because it erroneously concluded that the seized ledger copies belonged to the assessee, when they were merely transactional records of the searched trust. Consequently, the assessment proceedings under Section 153C were void ab initio.

The Tribunal held that the satisfaction note issued by the AO of the searched person was vitiated because it erroneously concluded that the seized ledger copies belonged to the assessee, when they were merely transactional records of the searched trust. Consequently, the assessment proceedings under Section 153C were void ab initio.

The Tribunal held that the satisfaction note issued by the AO of the searched person was vitiated because it erroneously concluded that the seized ledger copies belonged to the assessee, when they were merely transactional records of the searched trust. Consequently, the assessment proceedings under Section 153C were void ab initio.

The Tribunal held that penalty under Section 271(1)(c) cannot be levied when the addition to income is made on an estimated basis. Furthermore, the penalty proceedings were vitiated due to a vague and ambiguous show cause notice issued by the AO, failing to specify under which limb of Section 271(1)(c) the penalty was initiated.

The Tribunal held that the CIT(A) was justified in directing the AO to re-compute capital gains based on the DVO's valuation, as per Section 50C(2). The assessee's objections to the DVO's report were considered general and mechanical.

The tribunal held that the CIT(A) erred in confirming the addition of Rs.4,15,32,500/- under section 43CA, considering the assessee followed the project completion method and the project had not yet started. The charging of interest and initiation of penalty proceedings were also questioned.

The Tribunal admitted the additional evidence (confirmation from Mudra Holdings Pvt. Ltd. and Balance Sheet for the subsequent year) submitted by the assessee. The appeal was restored back to the Assessing Officer for a de novo assessment after considering the fresh documents.

The Tribunal recalled its ex-parte order and accepted the assessee's request to withdraw the appeal. The settlement under the VSV Scheme meant the appeal could no longer be pursued.

The Tribunal held that the referral fees were in the nature of business income and not fee for technical services, and thus not taxable in India as the assessee's Dubai branch did not have a PE in India. The Tribunal also ruled that Minimum Alternate Tax (MAT) provisions could not be applied to income not attributable to the Indian PE, especially when treaty provisions offered different tax treatment.

The Tribunal held that the CIT(A) erred in estimating the relief on contract receipts without considering the assessee's contentions. It directed the AO to calculate 8% as net profit on the contract amount under Section 44AD.

The Tribunal held that since the assessee failed to produce the parties for verification to substantiate its claims, it was a case of purchasing accommodation entries on commission. The AO was justified in estimating the commission at 2% on the bogus purchase entries.

The Tribunal held that the CIT(A) erred by not adjudicating the substantive grounds of appeal. The appeal was set aside and remanded to the CIT(A) for a fresh adjudication on merits.

The Tribunal held that since the assessee failed to produce the parties for verification to substantiate its claims, it was a case of purchasing accommodation entries on commission. The AO was justified in estimating the commission at 2% on the bogus purchase entries.

The Tribunal held that income from R&D services needs to be verified and segregated to determine the eligible deduction under Section 35(2AB). For professional fees, the Tribunal followed its own previous decisions and allowed certain claims, while remitting one issue for verification.

The Tribunal held that since the assessee failed to produce the parties for verification to substantiate its claims, it was a case of purchasing accommodation entries on commission. The AO was justified in estimating the commission at 2% on the bogus purchase entries.

The Tribunal held that the shares held by the assessee trust were in the nature of capital assets, not stock-in-trade, and the resultant gains should be taxed as capital gains, not business income. This decision was upheld by the Bombay High Court and the Supreme Court.

The Tribunal held that admitting additional evidence was justified as the Assessing Officer had a reasonable opportunity to examine it during remand proceedings. The Tribunal found no infirmity in the CIT(A)'s order which restricted the addition to only two unverified share transactions.

The Tribunal held that the assessee was an accommodation entry provider and directed the Assessing Officer to consider 0.25% as the net profit rate/commission on the alleged accommodation entry transactions. Expenditure claims were rejected due to lack of supporting details.

The Tribunal held that the assessee's method of accounting for business loss and capitalization of expenses to work-in-progress was consistent and in line with law, following previous decisions. It also held that interest income from fixed deposits, linked to the business, should be treated as business income, again following precedent.

The Tribunal held that the assessee was eligible for MAT credit as the demand for AY 2011-12 was quashed and the MAT credit was brought forward. The Tribunal also directed the AO to verify and credit the Rs. 10,00,00,000/- challan amount.

The Tribunal held that the appeals are not maintainable in their current format because the IRP has not been formally substituted as the representative of the assessee. The appeals were dismissed on this ground.

The Tribunal held that the Assessing Officer reopened the assessment based on a change of opinion, without any tangible material to support the escapement of income. The assessee's consistent practice of declaring licence fee as business income was upheld.

The Tribunal held that the shares held by the assessee trust were in the nature of capital assets, not stock-in-trade, and the resultant gains should be taxed as capital gains, not business income. This decision was upheld by the Bombay High Court and the Supreme Court.

The Tribunal noted that the CIT(A) passed ex-parte orders without verifying service of notices and without deciding the appeals on merits. Therefore, the appeals were remanded back to the CIT(A) for fresh adjudication.

The Tribunal noted that the CIT(A) passed ex-parte orders without verifying service of notices and without deciding the appeals on merits. Therefore, the appeals were remanded back to the CIT(A) for fresh adjudication.

The Tribunal held that the assessee failed to provide sufficient evidence to substantiate its claim for TDS credit, such as TDS certificates or details of income and deduction. Therefore, the issue was restored to the Assessing Officer for verification.

The Tribunal held that the appeals are not maintainable in their current format because the IRP has not been formally substituted as the representative of the assessee. The appeals were dismissed on this ground.

The Tribunal held that the assessee failed to provide sufficient evidence to substantiate its claim for TDS credit, such as TDS certificates or details of income and deduction. Therefore, the issue was restored to the Assessing Officer for verification.

The Tribunal held that the appeals are not maintainable in their current format because the IRP has not been formally substituted as the representative of the assessee. The appeals were dismissed on this ground.

The Tribunal held that the assessee failed to provide sufficient evidence to substantiate its claim for TDS credit, such as TDS certificates or details of income and deduction. Therefore, the issue was restored to the Assessing Officer for verification.

The Tribunal held that the conversion of interest into equity shares does not constitute actual payment as required by Section 43B, especially considering Explanation 3C to the section. Therefore, the deduction claimed was not allowable.

The Tribunal noted that the tax effect was below the specified monetary limit for departmental appeals. Consequently, the appeal was dismissed as withdrawn in terms of the circular.

The Tribunal held that the assessee's name and mobile number found in the ledger from M/s. Evergreen Enterprises, which detailed cash transactions, constituted direct corroborative evidence of the assessee's involvement. Therefore, the penalty was sustained.

The Tribunal held that the appeals are not maintainable in their current format because the IRP has not been formally substituted as the representative of the assessee. The appeals were dismissed on this ground.

The Tribunal held that the assessee failed to provide sufficient evidence to substantiate its claim for TDS credit, such as TDS certificates or details of income and deduction. Therefore, the issue was restored to the Assessing Officer for verification.

The Tribunal held that the appeals are not maintainable in their current format because the IRP has not been formally substituted as the representative of the assessee. The appeals were dismissed on this ground.

The Tribunal held that the disallowance made under Section 143(1) constituted a mistake apparent from the record. It further held that the amendments by the Finance Act, 2021, were not applicable retrospectively for the assessment year in question.

The Tribunal held that penalty under Section 271(1)(c) cannot be levied on an addition made on an estimated basis. Therefore, the levy of penalty was directed to be deleted.

The Tribunal allowed the assessee to withdraw the appeal as the issues were settled under the Vivad Se Vishwas Scheme. The assessee was granted liberty to seek restoration if there were technical reasons.

The Tribunal held that the appeals are not maintainable in their current format because the IRP has not been formally substituted as the representative of the assessee. The appeals were dismissed on this ground.

The Tribunal held that the assessee was receiving back its own money paid as advance to a defaulting supplier. The Assessing Officer's addition under Section 68 was based on suspicion and investigation reports without independent application of mind.

The Tribunal held that the AO erred in not referring the valuation to a Valuation Officer as required by law when the assessee disputed the stamp duty value. However, the Tribunal also held that the transaction of entering into an agreement to sell constituted a 'transfer' for the purpose of Section 56(2)(vii)(b).

The Tribunal held that advertisement and sales promotion expenses are revenue in nature and deductible under Section 37(1). It also deleted additions made on account of these expenses, relying on various judicial precedents.

The Tribunal held that the assessee is entitled to proportionate deduction under Section 80IB(10) for residential units that comply with the prescribed area limit, even if some units in the project do not. The disallowance should be restricted to the non-compliant units.

The Tribunal held that the penalty notice issued under section 274 read with section 271B was defective as it did not specify the exact fault or charge for which the penalty was being levied. Therefore, the penalty was vitiated.

The Tribunal held that the assessee failed to provide sufficient evidence of services rendered for the consultancy fee. While the CIT(A) had deleted the disallowance, the Tribunal found the evidence insufficient and remitted the matter back to the CIT(A) for further findings on the rendition of services.

The tribunal condoned the delay in filing the appeal. It found that the assessee had submitted relevant information during remand proceedings and that the CIT(A) had not properly considered these submissions or given adequate opportunity of being heard.

The Tribunal held that the option agreement with HRPL was a normal business transaction and not a sham. The difference in prices was attributable to various factors like timing, market conditions, and floor levels, and HRPL was a B2B customer. The addition made by the AO was unjustified.

The Tribunal upheld the CIT(A)'s order, finding no infirmity in restricting the disallowance under Section 14A to the extent of exempt income earned. The revenue failed to provide new evidence to counter the CIT(A)'s observations.