ITAT Mumbai Judgments — September 2022

The Tribunal held that the AO failed to verify crucial aspects of the redevelopment project, including the accounting of sales and the absence of profit. Since the assessee did not appear or provide submissions to disprove the Pr.CIT's findings, the Tribunal found no reason to interfere with the Pr.CIT's decision.

The Tribunal held that service tax collected by the assessee should not be included in gross receipts for computing income under Section 44BB. It also held that a separate addition for unpaid service tax would be a double addition. The issue of certain receipts not yet payable was remanded for examination.

The Tribunal held that the assessee was not provided with an adequate opportunity of being heard by the AO, violating the principles of natural justice. Therefore, the case was remitted back to the AO for fresh adjudication.

The Tribunal held that the assessment was made on ad-hoc basis without proper inquiry and consideration of documents. The penalty was consequential to the quantum assessment. Therefore, both the assessment and penalty orders were not sustainable.

The Tribunal noted that the DRP had not yet passed an order for the earlier assessment year. Therefore, to do justice, the Tribunal set aside the assessment orders and remanded all issues back to the DRP for fresh adjudication.

The Tribunal held that Section 80P(4) carves out an exception for co-operative banks, not for co-operative societies earning interest from co-operative banks. Therefore, the assessee is eligible for deduction under Section 80P(2)(d).

The Tribunal held that when sales are accepted as genuine, the entire purchase amount cannot be treated as non-genuine. Following High Court and co-ordinate bench decisions, the Tribunal directed that only the profit element embedded in the bogus purchases should be added to the income.

The Tribunal held that the subscription charges received by ACS for access to its databases and publications do not constitute royalty income under the India-US DTAA or Section 9(1)(vi) of the Income Tax Act. The Tribunal followed its own previous decisions on similar facts.

The Tribunal held that the assessment was made on ad-hoc basis without proper inquiry and consideration of documents. The penalty was consequential to the quantum assessment. Therefore, both the assessment and penalty orders were not sustainable.

The Tribunal held that the Principal Commissioner erred in invoking Section 263 as the Assessing Officer had taken a plausible view after examining the facts and documents. The twin conditions of the assessment order being erroneous and prejudicial to the revenue were not satisfied.

The Tribunal upheld the CIT(A)'s decision, treating the sales tax subsidy as a capital receipt. It also directed that this subsidy should be excluded when computing book profit under Section 115JB of the Income Tax Act.

The Tribunal held that the AO could not go beyond the 35 issues identified by the Settlement Commission. Therefore, the CIT's revisionary jurisdiction under Section 263 was wrongly invoked for issues not part of the Settlement Commission's directions, including Section 145A adjustments and warranty provisions.

The Tribunal held that interest on NPA/NPI accounts should be taxed as per RBI guidelines, not strictly on accrual basis. It also ruled that investments held as stock-in-trade by the bank, and losses on revaluation thereof, are allowable as deduction. The issue of broken period interest was also decided in favour of the assessee.

The Tribunal held that the AO could not go beyond the 35 issues identified by the Settlement Commission. Therefore, the CIT's revisionary jurisdiction under Section 263 was wrongly invoked for issues not part of the Settlement Commission's directions, including Section 145A adjustments and warranty provisions.

The Tribunal held that the AO could not go beyond the 35 issues identified by the Settlement Commission. Therefore, the CIT's revisionary jurisdiction under Section 263 was wrongly invoked for issues not part of the Settlement Commission's directions, including Section 145A adjustments and warranty provisions.

The Tribunal held that the assessee was not provided with a real and effective opportunity of being heard, nor was an opportunity given to cross-examine third-party evidence. This violated the principles of natural justice, rendering the orders unsustainable.

The Tribunal upheld the CIT(A)'s order, finding that the mere issuance of a cheque without actual debit from the bank account and credit to the recipient's account did not constitute a valid loan. The confirmation of the receivable balance implied the amount was paid, likely in cash and unrecorded.

The Tribunal held that the disallowance under Section 14A read with Rule 8D was not permissible for an insurance business, following previous consistent rulings. Consequently, the Revenue's appeal on this ground was dismissed.

The Tribunal held that interest subsidy, being a capital receipt, should be excluded from computing book profit under Section 115JB. The disallowance of administrative expenses under Section 14A for the purpose of book profit was also addressed.

The Tribunal held that filing the audit report in Form 10B after the return but before the due date of filing the return constitutes sufficient compliance with Section 12A(b). Furthermore, the CPC/AO erred in making adjustments under Section 143(1) without issuing a notice to the assessee.

The Tribunal held that the interest subsidy, being a capital receipt, should be excluded from the computation of book profit under Section 115JB. The Tribunal also addressed the disallowance of administrative expenses under Section 14A for book profit computation.

The Tribunal condoned a 5-day delay in the assessee's appeal to the CIT(A), stating that substantial justice should be preferred over technical considerations. The case was remitted back to the CIT(A) to decide on merits.

The Tribunal held that the rectification proceedings under Section 154 were barred by limitation as the notice was issued beyond the prescribed four-year period. Furthermore, the issues raised regarding depreciation and TDS were debatable and thus not rectifiable under Section 154.

The Tribunal condoned the delay in filing the appeal, stating that the CIT(A) took a hyper-technical view. The Tribunal held that pursuing a rectification petition does not debar an assessee from filing an appeal against the original assessment order.

The Tribunal held that the assessment proceedings under Section 153C for Assessment Years 2011-12 and 2012-13 were not in accordance with law and quashed them. The Revenue's appeals were rendered academic and dismissed.

The Tribunal held that the assessment was made on ad-hoc basis without proper inquiry and consideration of documents. The penalty was consequential to the quantum assessment. Therefore, both the assessment and penalty orders were not sustainable.

The Tribunal held that the assessee was not provided with a real and effective opportunity of being heard, nor was an opportunity given to cross-examine third-party evidence. This violated the principles of natural justice, rendering the orders unsustainable.

The Tribunal held that the Assessing Officer's order was erroneous and prejudicial to the revenue as it was passed without application of mind regarding the eligibility for exemption. Therefore, the CIT(Exemption)'s revision order was justified.

The Tribunal upheld the order of the CIT(A) which had deleted the additions. It found that the CIT(A) correctly considered the nature of the transaction as cash loans and noted that the AO failed to provide sufficient evidence to link the assessee to property dealings of the Bhoomi group and denied cross-examination.

The Tribunal upheld the order of the CIT(A) which had deleted the additions. It found that the CIT(A) correctly considered the nature of the transaction as cash loans and noted that the AO failed to provide sufficient evidence to link the assessee to property dealings of the Bhoomi group and denied cross-examination.

The Tribunal held that no disallowance of interest was warranted under Rule 8D(2)(ii) as the investments yielding exempt income were presumed to be made from interest-free funds. For Rule 8D(2)(iii), the AO was directed to recompute disallowance considering only investments that actually yielded exempt income. Foreign travel expenses and ad-hoc disallowances on travelling, sales promotion, office maintenance, and staff welfare were directed to be deleted.

The Tribunal held that the surplus in the shareholders' account cannot be taxed separately as income from other business activities, as it is an integral part of the life insurance business. It also held that Section 14A of the Act did not apply to the insurance business in this case.

The Tribunal remanded the issue of commission on bogus sales to the Assessing Officer for fresh consideration after admitting additional evidence. However, the deduction claimed under Chapter VIA was dismissed due to lack of evidence.

The Tribunal held that the surplus in the shareholders' account cannot be taxed separately as income from other business activities, as it is an integral part of the life insurance business. It also held that Section 14A of the Act did not apply to the insurance business in this case.

The Tribunal remanded the issue of commission on bogus sales to the Assessing Officer for fresh consideration after admitting additional evidence. However, the deduction claimed under Chapter VIA was dismissed due to lack of evidence.

The Tribunal remanded the issue of commission on bogus sales to the Assessing Officer for fresh consideration after admitting additional evidence. However, the deduction claimed under Chapter VIA was dismissed due to lack of evidence.

The Tribunal held that a statement recorded under Section 132(4) alone, without corroborating incriminating material found during the search, cannot be the sole basis for making additions under Section 68 in a Section 153A assessment. The assessment for the year was unabated at the time of the search.

The Tribunal held that the Assessing Officer failed to provide sufficient evidence to prove the donations were bogus. It also confirmed that provisions for gratuity and leave encashment are allowable, following previous decisions.

The Tribunal held that foreign travel expenses were justified as directors were accompanied by an architect and advocate, indicating business purpose. Business promotion expenses were also allowed as the nexus was established. Depreciation on a car registered in the director's name but used for business was allowed.

The Tribunal held that amenity fees received from tenants for amenities integral to the property should be treated as 'Income from House Property'. Consequently, deductions under Section 24(a) are allowable.

The Tribunal held that disallowances under Section 143(1) cannot disregard binding jurisdictional High Court decisions. Payments of employee contributions to provident fund made before the income tax return filing due date are deductible, even if made after the statutory due date.

The Tribunal found that the lower authorities did not sufficiently examine whether the fees and levies collected by the SRA were integral to its principal objects or necessary for their furtherance. Consequently, the matter was remanded for de novo adjudication.

The Tribunal upheld the CIT(A)'s order, finding no error in the addition for interest on refund and the disallowance under Section 14A. The Tribunal relied on High Court decisions regarding the invocation of Section 14A.

The Tribunal held that adjustments made under section 143(1) for delayed payment of employee contributions to PF and ESI are not justified when payments are made before the due date of filing the income tax return. The Tribunal followed a co-ordinate bench decision and directed the deletion of such disallowances.

The Tribunal remanded the issue of commission on bogus sales to the Assessing Officer for fresh consideration after admitting additional evidence. However, the deduction claimed under Chapter VIA was dismissed due to lack of evidence.

The Tribunal found that the lower authorities had not sufficiently examined whether the fees and levies collected by the SRA were integral to its principal objects or necessary for furthering its charitable purpose. Therefore, the issue was remanded for de novo adjudication.

The Tribunal held that the Assessing Officer failed to provide sufficient evidence to prove the donations were bogus. It also confirmed that provisions for gratuity and leave encashment are allowable, following previous decisions.

The tribunal held that the appeals were not maintainable because the assessee company was under liquidation and the necessary procedural steps to implead the Liquidator had not been taken by either party. However, liberty was granted to revive the appeals after rectifying the defects.

The Tribunal held that adjustments made under section 143(1) for delayed payment of employee contributions to PF and ESI are not justified when payments are made before the due date of filing the income tax return. The Tribunal followed a co-ordinate bench decision and directed the deletion of such disallowances.

The Tribunal remanded the issue of commission on bogus sales to the Assessing Officer for fresh consideration after admitting additional evidence. However, the deduction claimed under Chapter VIA was dismissed due to lack of evidence.