ITAT Mumbai Judgments — July 2023

The Tribunal restored the issue of disallowance of interest expenditure to the AO for fresh adjudication, considering recent judicial pronouncements. The disallowance of interest under Section 14A for computing book profit under Section 115JB was dismissed in favour of the assessee.

The Tribunal found that there was a reasonable cause for the assessee not receiving the notices. Consequently, the ex-parte order of the CIT(A) was set aside and the appeal was restored for adjudication on merits.

The Tribunal held that there is no restriction or bar in setting off foreign dividend income against the current year's loss. The Tribunal confirmed the CIT(A)'s order on this point, dismissing the Revenue's grounds of appeal related to this issue.

The Tribunal set aside the impugned order and restored the appeal to the file of the AO for a de novo assessment, subject to the assessee paying a cost of Rs. 10,000/-. The AO was directed to provide a reasonable opportunity for submissions.

The Tribunal held that while the entire purchases could not be added, applying a gross profit rate on such purchases was justified. It reduced the GP rate from 12.5% to 5% on the alleged bogus purchases.

The CIT(A) deleted the addition, finding that the assessee had successfully explained the source of the cash as part of their disclosed cash-in-hand. The Tribunal upheld this deletion.

The Tribunal restored the case to the CIT(Exemption) for fresh adjudication. The assessee was directed to make necessary compliance before the CIT(Exemption) without failure.

The Tribunal found that the CIT(A) passed an ex-parte order despite the assessee seeking an adjournment. Therefore, in the interest of natural justice, the matter was restored back to the CIT(A) for a fresh decision.

The Tribunal condoned the delay in filing the appeals and found that the assessee had bonafide reasons for not complying with the notices due to being a newly registered trust with limited technical staff. Therefore, the appeals were restored to the CIT(Exemption) for fresh consideration.

The Tribunal held that the assessee had provided documentary evidence for genuine, delivery-based share transactions. The issue of F&O losses was restored to the AO for de novo examination.

The Tribunal condoned the 11-minute delay in filing the return, considering the technical glitches faced by the appellant. It directed the Assessing Officer to allow the carry forward of the business loss, stating that denial solely on account of such a minor delay would be a travesty of justice.

The Tribunal restored the case to the CIT(Exemption) for fresh adjudication. The assessee was directed to make necessary compliance before the CIT(Exemption) without failure.

The Tribunal condoned the delay in filing the appeals and found that the assessee had bonafide reasons for not complying with the notices due to being a newly registered trust with limited technical staff. Therefore, the appeals were restored to the CIT(Exemption) for fresh consideration.

The Tribunal noted that the substantive addition made in the hands of Shri Praveen Kumar Jain had been confirmed by the Tribunal. Therefore, the protective assessment made in the hands of the assessee was directed to be deleted.

The Tribunal held that the amendment to Section 14A by the Finance Act, 2022, including the Explanation, is prospective and effective from April 1, 2022. Therefore, it cannot be applied to the assessment year under consideration.

The Tribunal admitted additional documentary evidence submitted by the assessee and restored the matter to the Assessing Officer for verification and fresh adjudication. The grounds of appeal were allowed for statistical purposes.

The Tribunal held that since payments for purchases were made through account payee cheques and there were corresponding sales, a penalty cannot be levied on an ad-hoc GP rate applied to alleged bogus purchases. The penalty was deleted.

The Tribunal noted that the substantive addition made in the hands of Shri Praveen Kumar Jain had been confirmed by the Tribunal. Therefore, the protective assessment made in the hands of the assessee was directed to be deleted.

The Tribunal held that the Assessing Officer's view was plausible and the PCIT was not justified in exercising revisionary powers under Section 263. The Tribunal noted that relevant facts were on record and the PCIT's grounds for revision were not sustainable.

The Tribunal noted that the substantive addition made in the hands of Shri Praveen Kumar Jain had been confirmed by the Tribunal. Therefore, the protective assessment made in the hands of the assessee was directed to be deleted.

The Tribunal noted that the substantive addition made in the hands of Shri Praveen Kumar Jain had been confirmed by the Tribunal. Therefore, the protective assessment made in the hands of the assessee was directed to be deleted.

The Tribunal held that the additions based on loose papers could not be sustained as there was no evidence to prove they belonged to the assessee, were in her handwriting, or were found in her possession. However, the addition for deemed rental income from house property was upheld.

The Tribunal held that the additions based on loose papers could not be sustained as there was no evidence to prove they belonged to the assessee, were in her handwriting, or were found in her possession. However, the addition for deemed rental income from house property was upheld.

The Tribunal held that the additions based on loose papers could not be sustained as there was no evidence to prove they belonged to the assessee, were in her handwriting, or were found in her possession. However, the addition for deemed rental income from house property was upheld.

The Tribunal noted that the substantive addition made in the hands of Shri Praveen Kumar Jain had been confirmed by the Tribunal. Therefore, the protective assessment made in the hands of the assessee was directed to be deleted.

The Tribunal held that assessment orders based on invalid orders passed in the name of a non-existent entity are unsustainable. Consequently, the final assessment orders were quashed.

The Tribunal held that the addition was not sustainable as the assessee had purchased shares through a reputable broker and the statements relied upon by the AO were made prior to the assessee's purchase. Furthermore, the Tribunal noted that one of the share transactions actually resulted in a loss, strengthening the genuineness of the assessee's claim.

The Tribunal held that the assessee had provided sufficient evidence of savings from salary, his wife's savings, and a loan from his mother to explain the cash deposit. The CIT(A) had dismissed the appeal without considering the merits.

The Tribunal held that the deduction under Section 80P could not be denied on a hyper-technical ground like failure to upload the audit report, especially when the claim was otherwise admissible and supported by judicial precedents. The Tribunal directed the AO to allow the deduction after verification of the audit report.

The Tribunal held that the assessee had discharged its primary onus by providing loan confirmations, acknowledgments of returns filed by the lenders, and bank statements. The Tribunal also noted that TDS was deducted on interest payments, strengthening the genuineness of the claim. Since no fresh cash credit was introduced in the assessee's books during the year, Section 68 was not applicable.

The Tribunal held that interest income earned by a cooperative society on its investments with a cooperative bank is eligible for deduction under Section 80P(2)(d). The decisions of the Karnataka and Gujarat High Courts were followed.

The Tribunal upheld the deletion of additions related to the cost of land and interest expenditure, agreeing with the CIT(A) that the land was not vacant and the interest was for business purposes. The Tribunal also noted that the revenue had not contested similar issues in prior years.

The Tribunal held that the disallowance of TDS credit on the ground that it was not reflected in the P&L account was not sustainable. The Tribunal noted that the assessee had consistently followed the practice of recording service charges separately and that the corresponding income resulted in Nil net income.

The Tribunal held that the addition for employees' PF/ESIC contribution of Rs. 3,159/- was rightly made, but other additions regarding duties, cess, bonus, employer's PF/ESIC, and leave encashment were made without proper verification. The case was remanded to the AO for fresh adjudication.

The Tribunal upheld the deletion of additions related to the cost of land and interest expenditure, agreeing with the CIT(A) that the land was not vacant and the interest was for business purposes. The Tribunal also noted that the revenue had not contested similar issues in prior years.

The Tribunal held that interest income earned by a cooperative society on its investments with cooperative banks is eligible for deduction under Section 80P(2)(d). The Tribunal relied on various High Court and ITAT judgments that distinguish the applicability of Section 80P(4).

The Tribunal held that the AO had not adhered to the correct method of computation for granting interest under Section 244A. The Tribunal directed the AO to re-examine the computation in accordance with a previous ITAT decision in the case of Bank of Baroda.

The Tribunal held that the AO had not adhered to the correct method of computation for granting interest under Section 244A. The Tribunal directed the AO to re-examine the computation in accordance with a previous ITAT decision in the case of Bank of Baroda.

The Tribunal held that the assessee had discharged its primary onus by providing loan confirmations, acknowledgments of returns filed by the lenders, and bank statements. The Tribunal also noted that TDS was deducted on interest payments, strengthening the genuineness of the claim. Since no fresh cash credit was introduced in the assessee's books during the year, Section 68 was not applicable.

The Tribunal held that the assessee acted as an ordinary investor, purchased and sold shares through a recognized stock exchange via a registered broker, and provided all necessary documentation. Relying on jurisdictional High Court judgments, the Tribunal found no reason to doubt the capital gains.

The Tribunal held that the AO had not adhered to the correct method of computation for granting interest under Section 244A. The Tribunal directed the AO to re-examine the computation in accordance with a previous ITAT decision in the case of Bank of Baroda.

The Tribunal upheld the deletion of the addition made by the Assessing Officer. The CIT(A) was justified in deleting the addition, as the property was acquired through a transparent auction process from a bank in liquidation.

The Tribunal held that since the substantive additions in the hands of Mr. Praveen Kumar Jain were upheld by a coordinate bench, the protective additions made in the assessee's hands were unsustainable and directed to be deleted. However, the AO was directed to revive the additions if the substantive additions in Mr. Jain's case were deleted in further appeals.

The Tribunal held that since the original addition was made without jurisdiction, the penalty levied based on that addition is unsustainable. Therefore, the deletion of the penalty by the CIT(A) is upheld.

The Tribunal held that the AO made an addition for unexplained expenditure without issuing a fresh notice under Section 148 of the Act, which was necessary for assessing other income. Therefore, the addition was deleted.

The Tribunal held that since the substantive additions in the hands of Mr. Praveen Kumar Jain were upheld by a coordinate bench, the protective additions made in the assessee's hands were unsustainable and directed to be deleted. However, the AO was directed to revive the additions if the substantive additions in Mr. Jain's case were deleted in further appeals.

The Tribunal held that interest income earned by a co-operative society from its investments with co-operative banks is eligible for deduction under Section 80P(2)(d). The CIT(A)'s order upholding the disallowance was set aside.

The Tribunal held that the assessee had paid the amount through banking channels and entered into cancellation deeds. Since the amount was capitalized and not claimed as expenditure, the disallowance was incorrect.

The Tribunal held that the penalty notice was defective and invalid because it did not clearly state the specific charge against the assessee. Consequently, the penalty levied by the AO was considered bad in law.

The Tribunal held that a Co-operative Bank, despite being excluded from Section 80P benefits itself, remains a 'Co-operative Society' for the purpose of Section 80P(2)(d). Therefore, interest earned by a Co-operative Society from investments in a Co-operative Bank is eligible for deduction.