ITAT Mumbai Judgments — August 2023

The Tribunal set aside the issue of benchmarking royalty payments back to the Assessing Officer for determination of the most appropriate method. Regarding depreciation on retired assets, the Tribunal upheld the DRP's decision to allow the claim, following a jurisdictional High Court ruling.

The Tribunal set aside the issue of benchmarking royalty payments back to the Assessing Officer for determination of the most appropriate method. Regarding depreciation on retired assets, the Tribunal upheld the DRP's decision to allow the claim, following a jurisdictional High Court ruling.

The Tribunal set aside the issue of benchmarking royalty payments back to the Assessing Officer for determination of the most appropriate method. Regarding depreciation on retired assets, the Tribunal upheld the DRP's decision to allow the claim, following a jurisdictional High Court ruling.

The Tribunal held that the management fees received by the assessee do not fall within the definition of FTS under Article 12(4) of the India-Singapore DTAA as the conditions for 'make available' or 'development and transfer of technical plan' were not met. The issue of software sale income was not fully adjudicated due to procedural reasons.

The Tribunal set aside the issue of benchmarking royalty payments back to the Assessing Officer for determination of the most appropriate method. Regarding depreciation on retired assets, the Tribunal upheld the DRP's decision to allow the claim, following a jurisdictional High Court ruling.

The Tribunal set aside the issue of benchmarking royalty payments back to the Assessing Officer for determination of the most appropriate method. Regarding depreciation on retired assets, the Tribunal upheld the DRP's decision to allow the claim, following a jurisdictional High Court ruling.

The Tribunal set aside the issue of benchmarking royalty payments to the Assessing Officer (AO) for determining the most appropriate method. For depreciation on retired assets, the Tribunal upheld the Dispute Resolution Panel's decision to allow the claim, following a High Court ruling.

The Tribunal held that if DWS expenses/brokerage represent reimbursements of expenses to DMF in accordance with SEBI regulations, they should be excluded from disallowance. It also directed that unamortized brokerage expenses, incurred in earlier years but claimed in a revised return due to business closure, should be allowed.

The Tribunal held that if DWS expenses/brokerage represent reimbursements of expenses to DMF in accordance with SEBI regulations, they should be excluded from disallowance. It also directed that unamortized brokerage expenses, incurred in earlier years but claimed in a revised return due to business closure, should be allowed.

The Tribunal held that the crucial fact of the assessee having no positive income after the first appellate order was not brought to the PCIT's notice. Therefore, the PCIT's revisional order was set aside and restored for fresh adjudication.

The Tribunal held that the addition of rental income was correctly confirmed. However, it allowed the deduction claimed by the assessee under Section 36(1)(vii) of the Act, finding that the CIT(A) had erred in not considering the fresh details filed by the assessee.

The Tribunal held that the addition of rental income was correctly confirmed. However, it allowed the deduction claimed by the assessee under Section 36(1)(vii) of the Act, finding that the CIT(A) had erred in not considering the fresh details filed by the assessee.

The Tribunal set aside the issue of benchmarking royalty payments back to the Assessing Officer for determination of the most appropriate method. Regarding depreciation on retired assets, the Tribunal upheld the DRP's decision to allow the claim, following a jurisdictional High Court ruling.

The Tribunal noted that similar issues in earlier years were decided in favor of the assessee, subject to verification. The Tribunal directed the AO to conduct necessary verification regarding the accounting treatment of deferred maintenance charges and allow the assessee's claim if found in accordance with law.

The Tribunal directed the AO to delete the addition made under Section 68 of the Act and accept the assessee's claim for long-term capital gains exemption for assessment years 2014-15 and 2015-16. Additions on account of commission were also deleted.

The Tribunal held that sales tax incentive, when exempt from tax, cannot be considered for the computation of book profit under Section 115JB. Therefore, the AO was directed to exclude the sales tax incentive from book profits.

The Tribunal found that the assessee had not substantiated its claim before the lower authorities and had failed to provide evidence for the identity, creditworthiness, and genuineness of the cash deposits. Therefore, the matter was remanded back to the CIT(A) for one more opportunity.

The Tribunal held that the reopening of assessment was invalid because the foundational information relied upon by the AO was subsequently found to be legally unsustainable by a higher authority. Therefore, the action of reopening the assessment was quashed.

The Tribunal restored the issue back to the CIT(A) for fresh adjudication, allowing the assessee to file additional evidence as per Rule 46A. However, a cost of Rs. 25,000 was imposed on the assessee for non-compliance and wastage of lower authorities' time.

The Tribunal held that the CIT(A) erred in excluding three comparable companies without proper justification. The Tribunal directed the Assessing Officer to re-compute the arm's length price by including these comparables and using OP/OC as the profit level indicator.

The Tribunal held that the reopening of assessment beyond four years was invalid as the prerequisites under the First Proviso to Section 147 were not met, and there was no failure on the assessee's part to disclose material facts. The reassessment proceedings were quashed.

The Tribunal upheld the decision of the Dispute Resolution Panel (DRP), finding that the interest on ECB was a genuine business transaction for working capital. The guarantee fees were paid to protect the assessee's interest on a loan given to a third party, and the service fees were for advisory services availed. The Tribunal found no reason to disturb the DRP's findings.

The Tribunal held that the reopening of assessment beyond four years was invalid as the prerequisites under the First Proviso to Section 147 were not met, and there was no failure on the assessee's part to disclose material facts. The reassessment proceedings were quashed.

The Tribunal held that the reopening of assessment beyond four years was invalid as the prerequisites under the First Proviso to Section 147 were not met, and there was no failure on the assessee's part to disclose material facts. The reassessment proceedings were quashed.

The Tribunal allowed the assessee's ground regarding disallowance of foreign travel expenses for spouses, following a previous decision. It also allowed the deduction under section 10B for acquired EOUs, citing a High Court ruling on the omission of a sub-section.

The Tribunal held that the delayed remittance of employees' contribution to ESI, even if due to genuine reasons, does not entitle the assessee to a deduction. The Supreme Court's decision in Checkmate Services Pvt Ltd was followed.

The Tribunal held that the tax rate applicable to domestic companies is not applicable to the assessee, following previous decisions. However, it ruled that interest paid by the Indian branch to the head office is not taxable in India. The Tribunal also directed the AO to examine claims regarding TDS credit and dispose of rectification petitions for interest levies.

The Tribunal held that the delayed remittance of employees' contribution to ESI, even if due to genuine reasons, does not entitle the assessee to a deduction. The Supreme Court's decision in Checkmate Services Pvt Ltd was followed.

The Tribunal found that the CIT(A) had passed the order ex-parte without considering the submissions and documentary evidence already on record. The Tribunal restored the appeal to the CIT(A) for fresh adjudication on merits.

The Tribunal found that the CIT(A) did not decide the appeal properly due to the absence of proper reply and documents. Therefore, the case was remanded to the CIT(A) for a fresh decision.

The Tribunal held that prior to the amendment introducing the words 'in India' in Section 54F, exemption could be claimed for property purchased outside India. Therefore, the assessee was entitled to the deduction.

The Tribunal upheld the CIT(A)'s decision to delete the disallowance of ESOP expenses. It followed the precedent set by the Karnataka High Court in the Biocon Ltd. case, which allowed such expenses as a deduction.

The Tribunal held that the inflated cost in the agreement, made solely to secure higher banking loan facility, could not be treated as undisclosed income or investment. The Assessing Officer had also not verified the actual cost with the vendor.

The Tribunal held that losses from F&O transactions are not speculative losses under Section 43(5)(d) of the IT Act. Therefore, such losses can be set off against business income.

The Tribunal found the allegations against the erstwhile CA to be unsubstantiated and unethical. However, considering the medical reasons and the fact that the CIT(NFAC) did not decide on merits, the case was remanded for a fresh decision.

The Tribunal held that the AO was incorrect in treating purchases from M/s Mehta & Sons as non-genuine without examining the submitted details, especially when similar transactions with a proprietor under the same name were accepted. For M/s Mahavir Rang Bhandar Pvt Ltd, the Tribunal found that the assessee had provided sufficient details and that non-response to a notice under Section 133(6) alone was not a sufficient reason to deem the transaction non-genuine.

The Tribunal held that the reimbursement of salary costs for employees providing essential services for the joint venture project was at arm's length and should be allowed. However, the ground related to disallowance of expenses under Section 14A was dismissed as not pressed.

The Tribunal found the allegations against the erstwhile CA to be unsubstantiated and unethical. However, considering the medical reasons and the fact that the CIT(NFAC) did not decide on merits, the case was remanded for a fresh decision.

The Tribunal held that the Commissioner (Appeals) correctly followed relevant High Court and Supreme Court judgments. The disallowance under Section 14A should be restricted to the exempt income earned by the assessee.

The Tribunal held that the income received by the assessee was not in the nature of royalty and was correctly offered to tax under Section 44B of the Income Tax Act. The Tribunal followed its own prior decision in the assessee's own case for a different assessment year.

The Tribunal upheld the CIT(A)'s decision to delete the disallowance of ESOP expenses. It followed the precedent set by the Karnataka High Court in the Biocon Ltd. case, which allowed such expenses as a deduction.

The Tribunal held that the reassessment proceedings were validly initiated. However, it found that the assessee had provided sufficient documentary evidence, including financial statements of the lender and its own ledger accounts, to prove the genuineness of the loan transaction.

The Tribunal held that the rights acquired over the agricultural land constituted a capital asset because the assessee could not carry out its intended business activities until the land's status was converted to non-agricultural. Therefore, the profit arising from the transfer is taxable as long-term capital gains.

The Tribunal held that the assessee had discharged the initial burden by providing documents to prove the identity, genuineness of transactions, and creditworthiness of the lenders. The AO failed to controvert these facts with contrary evidence.

The Tribunal held that the addition was made on an estimated basis without sufficient evidence of concealment of income. Relying on various High Court decisions, it was concluded that penalty under Section 271(1)(c) is not leviable when additions are made purely on an estimated basis.

The Tribunal held that the addition was made on an estimated basis without sufficient evidence of concealment of income. Relying on various High Court decisions, it was concluded that penalty under Section 271(1)(c) is not leviable when additions are made purely on an estimated basis.

The Tribunal directed the trusts to re-apply for registration in the prescribed format, complete all details, and comply with the previously issued notices within 90 days. The CIT(Exemption) was then instructed to dispose of these applications according to law.

The Tribunal held that the deduction under Section 10A should be computed on the profits of the eligible undertaking before set-off of brought forward losses and depreciation. The assessee withdrew the ground related to Section 40(a)(i).

The Tribunal directed the trusts to re-apply for registration in the prescribed format, complete all details, and comply with the previously issued notices within 90 days. The CIT(Exemption) was then instructed to dispose of these applications according to law.

For AY 2011-12, the Tribunal noted that the assessee provided ledger copies and Form 26AS to substantiate its claim that the income pertained to earlier years. For AY 2016-17, the Tribunal found that the CIT(A) passed an ex-parte order and directed fresh adjudication by the AO, allowing the assessee to present evidence.