ITAT Mumbai Judgments — December 2023

The Tribunal condoned the delay, citing reasonable cause. It set aside the CIT(A)'s ex-parte order and restored the appeal to the CIT(A)'s file for fresh adjudication, in the interest of natural justice.

The Tribunal held that when an assessee objects to the stamp duty valuation and claims it exceeds the fair market value, the AO is required to refer the valuation to the Valuation Officer (VO) under Section 50C(2). Since this procedure was not followed, the matter was set aside.

The Tribunal upheld the CIT(A)'s decision, following its own prior ruling in the assessee's case regarding the eligibility of the rail system for deduction under Section 80IA and the treatment of CENVAT credits. The Tribunal found no change in facts or law to deviate from the earlier decision.

The Tribunal held that the existence and continued business operations of the subscriber companies, along with documentary evidence of their creditworthiness, established the genuineness of the transaction. The mere association with an individual known for accommodation entries was not sufficient to deem the transaction bogus.

The Tribunal condoned the delay in filing the appeal due to non-receipt of the CIT(A)'s order. For the loan addition, the issue was remitted to the AO to delete the protective addition to the extent it was confirmed substantively in another person's hands. The addition for interest received in cash was dismissed.

The Tribunal upheld the CIT(A)'s decision, following its own prior ruling in the assessee's case regarding the eligibility of the rail system for deduction under Section 80IA and the treatment of CENVAT credits. The Tribunal found no change in facts or law to deviate from the earlier decision.

The Tribunal held that the suspension of business was temporary and not a permanent closure. Therefore, expenses incurred for preserving the business and assets were allowable, and various incomes were to be treated as business income.

The tribunal held that the issue of arm's length price of interest on loan transactions requires re-examination. It directed the AO to benchmark the interest on loan transactions by considering currency type, tenure, purpose, tranche type, covenants, credit rating, interest swap adjustment, tenor adjustment, and country risk adjustment.

The Tribunal held that for computing disallowance under Rule 8D(2)(iii), only investments yielding exempt income during the relevant assessment year should be considered, not all investments made during the year.

The Tribunal allowed deduction of net profits for computing 80HHC/80HHE deductions, remitted issues regarding miscellaneous income and 80HHB profits to the AO for adjudication, and deleted disallowance under Section 14A for book profits. Additional grounds regarding book profit computation were remitted to the AO.

The Tribunal held that once a company is dissolved under Section 560(5) of the Companies Act, it ceases to exist. Consequently, no order of assessment can be validly passed against a non-existent entity under the Income Tax Act. Such an order would be a nullity, akin to a civil court passing a decree against a deceased person. The Tribunal found that the assessee company was struck off and dissolved on March 18, 2011, prior to the assessment orders being passed. It respectfully followed the decisions of co-ordinate benches in the assessee's own case and the judgment of the Hon'ble Jammu and Kashmir and Ladakh High Court in M/S. RAINAWARI FINANCE & INVESTMENT COMPANY PVT. LTD. VERSUS INCOME TAX OFFICER, JAMMU, which held that assessment orders against dissolved companies are nullities. The Tribunal also noted that the Delhi High Court's decision in Skylight Hospitality Ltd. was distinguishable as it did not involve the dissolution of a company. Therefore, the assessment orders were not sustainable and were correctly quashed by the CIT(A). The appeals filed by the Assessing Officer were dismissed.

The Tribunal held that penalty under Section 271(1)(c) cannot be levied on additions made under the deeming provision of Section 50C, citing jurisdictional High Court precedents. The CIT(A) had confirmed the penalty ex-parte.

The Tribunal observed that the NFAC did not decide the appeal on merits due to the assessee's non-compliance. Therefore, the Tribunal set aside the NFAC's order and remanded the case back for a decision on merits.

The Tribunal held that the Assessing Officer erred in not applying the Profit Split Method (PSM) approved by the TPO to non-AE transactions and in estimating profits. It also ruled that the situs of intangible assets (channels) is with the owner, and thus gains from their transfer by non-residents are not taxable in India.

The Tribunal held that the Assessing Officer erred in not applying the Profit Split Method (PSM) approved by the TPO to non-AE transactions and in estimating profits. It also ruled that the situs of intangible assets (channels) is with the owner, and thus gains from their transfer by non-residents are not taxable in India.

The Tribunal held that once a company is dissolved under Section 560(5) of the Companies Act, it ceases to exist. Consequently, no order of assessment can be validly passed against a non-existent entity under the Income Tax Act. Such an order would be a nullity, akin to a civil court passing a decree against a deceased person. The Tribunal found that the assessee company was struck off and dissolved on March 18, 2011, prior to the assessment orders being passed. It respectfully followed the decisions of co-ordinate benches in the assessee's own case and the judgment of the Hon'ble Jammu and Kashmir and Ladakh High Court in M/S. RAINAWARI FINANCE & INVESTMENT COMPANY PVT. LTD. VERSUS INCOME TAX OFFICER, JAMMU, which held that assessment orders against dissolved companies are nullities. The Tribunal also noted that the Delhi High Court's decision in Skylight Hospitality Ltd. was distinguishable as it did not involve the dissolution of a company. Therefore, the assessment orders were not sustainable and were correctly quashed by the CIT(A). The appeals filed by the Assessing Officer were dismissed.

The Tribunal held that the assessee's original return filed on 29/11/2015 was within the due date of 30/11/2015, as it had international and specified domestic transactions requiring a report under Section 92E. The Form 10CCB was also filed on the same date as the return, supporting the deduction claim.

The Tribunal confirmed the disallowance for the current years, following its previous decisions. However, it directed the Assessing Officer to apply the decision of the Bombay High Court on the identical issue pending before it, as the assessee had filed applications under Section 158A and the AO did not object.

The Tribunal confirmed the disallowance for the current years, following its previous decisions. However, it directed the Assessing Officer to apply the decision of the Bombay High Court on the identical issue pending before it, as the assessee had filed applications under Section 158A and the AO did not object.

The Tribunal set aside the CIT(A)'s order, which had dismissed the appeal ex-parte due to non-compliance. The case was remitted back to the CIT(A) for a fresh adjudication on merits, ensuring the assessee is given an adequate opportunity to be heard.

The Tribunal directed the exclusion of Vitae International Accounting Services Pvt. Ltd. and Access Healthcare Services Pvt. Ltd. from the comparable list due to functional disparity. It also directed the inclusion of R. Systems International Ltd. and Sundaram Business Services, considering their availability of quarterly data and past acceptance by the TPO.

The Tribunal found that the assessee's claim of filing Form 10IC needed factual verification. Since no documentary evidence was provided to support this claim, the appeal was remitted back to the CIT(A) for examination of the evidence.

The Tribunal held that the AO must first adjust refunds towards the interest component before the principal tax component, and that interest should be calculated up to the date of actual refund receipt. The issue of additional interest under Section 244A(1A) was remanded to the AO for fresh examination.

The Tribunal set aside the CIT(A)'s order, remitting the issues back for fresh adjudication. The assessee was granted one more opportunity to present its case, adhering to principles of natural justice.

The Tribunal set aside the CIT(A)'s order, remitting the issues back for fresh adjudication. The assessee was granted one more opportunity to present its case, adhering to principles of natural justice.

The Tribunal held that penalty under Section 271(1)(c) cannot be levied when the addition to income is made on the basis of an estimate, as in this case where the addition was restricted to 12.5% of the alleged bogus purchases. The CIT(A) had failed to consider this aspect.

The Tribunal restored the appeal to the CIT(A) for fresh adjudication after providing the assessee with a reasonable opportunity of hearing. The CIT(A) was directed to issue notice to the assessee at the latest provided address.

The Tribunal held that interest expenses and foreign exchange losses related to projects should be allowed as revenue expenditure and not capitalized. It also held that no disallowance under Section 14A is permissible when no exempt income is earned. The Tribunal upheld the assessee's benchmarking of corporate guarantee commission.

The Tribunal restored the disputed issue to the Assessing Officer for examination and verification, providing the assessee with one more opportunity to substantiate their claims with evidence.

The Tribunal held that the penalty is unsustainable due to a defective notice under Section 271(1)(c) which did not strike off the inapplicable limb, and also because the addition was based on estimation. Therefore, the penalty was deleted.

The Tribunal held that there was no double deduction. The assessee had not claimed the portion of the asset cost funded by accumulated income as an application of income, but rather claimed depreciation on the remaining balance. Therefore, the depreciation claim was valid.

The Tribunal found that the CIT(A) passed the order ex-parte without affording adequate opportunity to the assessee. Therefore, the order was set aside to provide the assessee with another chance to present their case.

The Tribunal held that the CIT(A) cannot dismiss an appeal for non-prosecution and must decide on merits. The order of the CIT(A) was set aside, and the appeal was restored for a decision on merits.

The Tribunal held that delayed payment of employees' contribution to PF and ESIC, beyond the statutory due date, is not allowable as a deduction. This decision follows the Supreme Court's ruling in Checkmate Services Pvt. Ltd. v/s CIT.

The Tribunal held that delayed payment of employees' contribution to PF and ESIC, beyond the statutory due date, is not allowable as a deduction. This decision follows the Supreme Court's ruling in Checkmate Services Pvt. Ltd. v/s CIT.

The Tribunal held that the Assessing Officer was incorrect in applying the Comparable Uncontrolled Price (CUP) method for transfer pricing adjustments, as it requires strict comparability which was not met. The Tribunal also remitted the issue of CENVAT credit to closing stock back to the Assessing Officer.

The Tribunal held that the corporate guarantee transaction was an international transaction. However, it upheld the CIT(A)'s decision to determine the guarantee commission rate at 0.70% based on comparable data, finding no infirmity in the order regarding additional depreciation.

The Tribunal condoned the delay and admitted the appeal. It set aside the ex-parte order of the CIT(A) and restored the issues to the CIT(A)'s file for fresh adjudication in the interest of natural justice.

The Tribunal held that the Assessing Officer was incorrect in applying the Comparable Uncontrolled Price (CUP) method for transfer pricing adjustments, as it requires strict comparability which was not met. The Tribunal also remitted the issue of CENVAT credit to closing stock back to the Assessing Officer.

The Tribunal held that the Assessing Officer was incorrect in applying the Comparable Uncontrolled Price (CUP) method for transfer pricing adjustments, as it requires strict comparability which was not met. The Tribunal also remitted the issue of CENVAT credit to closing stock back to the Assessing Officer.

The Tribunal held that the Assessing Officer was incorrect in applying the Comparable Uncontrolled Price (CUP) method for transfer pricing adjustments, as it requires strict comparability which was not met. The Tribunal also remitted the issue of CENVAT credit to closing stock back to the Assessing Officer.

The Tribunal found that the CIT(A) dismissed the appeal ex-parte due to non-appearance. Considering principles of natural justice, the Tribunal set aside the CIT(A)'s order and remanded the case for fresh adjudication.

The Tribunal noted that the previous order had remanded the issue to the Assessing Officer for fresh verification of evidence. Therefore, the current appeal is also remanded back to the Assessing Officer for fresh verification.

The Tribunal upheld the CIT(A)'s decision to allow arm's length price for corporate guarantees at 0.20% and dismissed the revenue's appeal on this point. The Tribunal also dismissed the revenue's appeal regarding foreign exchange losses, following previous decisions. The assessee's appeal regarding Section 14A disallowance was allowed.

The Tribunal set aside the CIT(A)'s ex-parte order and restored the issues to the CIT(A)'s file for fresh adjudication. This was done in the interest of natural justice to provide the assessee an opportunity to be heard.

The Tribunal held that the corporate guarantee transaction was an international transaction. However, it upheld the CIT(A)'s decision to determine the guarantee commission rate at 0.70% based on comparable data, finding no infirmity in the order regarding additional depreciation.

The Tribunal upheld the CIT(A)'s decision to allow arm's length price for corporate guarantees at 0.20% and dismissed the revenue's appeal on this point. The Tribunal also dismissed the revenue's appeal regarding foreign exchange losses, following previous decisions. The assessee's appeal regarding Section 14A disallowance was allowed.

The Tribunal held that the corporate guarantee transaction was an international transaction. However, it upheld the CIT(A)'s decision to determine the guarantee commission rate at 0.70% based on comparable data, finding no infirmity in the order regarding additional depreciation.

The Tribunal held that the Assessing Officer was incorrect in applying the Comparable Uncontrolled Price (CUP) method for transfer pricing adjustments, as it requires strict comparability which was not met. The Tribunal also remitted the issue of CENVAT credit to closing stock back to the Assessing Officer.

The Tribunal held that the corporate guarantee transaction was an international transaction. However, it upheld the CIT(A)'s decision to determine the guarantee commission rate at 0.70% based on comparable data, finding no infirmity in the order regarding additional depreciation.