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541 orders · Page 6 of 11
The Tribunal held that the delay in filing the appeal was due to a bonafide belief in rectification and the circumstances surrounding the COVID pandemic. Relying on judicial precedents, the Tribunal emphasized that substantial justice should be preferred over technical considerations, especially when the delay is not deliberate.
The Tribunal held that for the Assessment Year 2006-07, Section 194C(1)(k) was not applicable to individuals as it was introduced later. Furthermore, in the absence of evidence of a sub-contractual relationship with the crew wage workers, Section 194C(2) was also not applicable.
The Tribunal held that the notice issued under Section 148 was invalid because the prior approval was obtained from the Principal Commissioner instead of the Principal Chief Commissioner, as required for reassessments initiated more than three years after the end of the assessment year. Consequently, the reassessment proceedings were quashed.
The Tribunal deemed the issue of unexplained sources of transfers/credits in the assessee's bank account a factual matter requiring verification. Consequently, the case was restored to the AO's file to verify the source of Rs. 20,07,904/- and issue a fresh order after providing the assessee another opportunity to be heard. The appeal was allowed for statistical purposes, clarifying that this restoration holds no bearing on the merits of the dispute.
The Tribunal condoned the delay in filing the appeal, acknowledging the assessee's reasonable cause. It held that expenses incurred for setting up a business, even before commencement, are allowable if genuine. Depreciation on machinery used for trial production is also permissible.
The Tribunal held that the AO and CIT(A) erred by not examining the evidence provided by the assessee, such as ledger accounts and sample invoices, which indicated individual petty expenses were below Rs. 20,000. The matter was restored to the AO for de novo adjudication.
The Tribunal held that expenditure incurred on abandoned projects, which represent an expansion of the existing business and do not result in the creation of a new asset of enduring benefit, is allowable as a revenue expenditure. The disallowance made by the revenue authorities was therefore incorrect.
The Tribunal held that the disallowance under Section 14A and Rule 8D needs to be recomputed. The AO computed the disallowance under the second and third limbs of Rule 8D(2) without considering the assessee's submissions that it had sufficient surplus funds and relied on the decision in CIT vs. Reliance Utilities and Power Ltd. The Tribunal agreed that the disallowance under Rule 8D(2)(ii) was made without regard to the assessee's accounts and directed its deletion, respectfully following the Bombay High Court decision. Regarding the third limb of Rule 8D(2), the Tribunal restricted the disallowance to investments that yielded exempt income, referring to Delhi and Gujarat High Court decisions. The AO was directed to consider if the computed disallowance is less than the suo moto disallowance made by the assessee, in which case the disallowance should be restricted to the suo moto amount. The grounds raised by the assessee in its appeal were partly allowed. The Revenue's appeal concerning software expenses related to the website/portal was dismissed, respectfully following the coordinate bench's decision in the assessee's own case for earlier years. The issue of inventory valuation using FIFO was not explicitly decided in the provided text, but the Revenue's appeal was dismissed overall.
The Tribunal held that the Assessing Officer erred in making the addition under Section 69B of the Act solely based on the difference between the property's purchase consideration and its stamp duty valuation. The AO failed to establish, with cogent evidence, that there was an understatement of consideration (investment) in the assessee's books of account. The Tribunal noted that the AO seemed to have jumped to the final step of applying Section 69B without fulfilling the initial requirement of proving an understatement. The CIT(A) had relied on the Gujarat High Court's decision in Gayatri Enterprise Vs ITO, which in turn relied on the Delhi High Court's decision in CIT V. Dinesh Jain HUF. This precedent held that Section 69B does not permit an inference of payment of more than recorded in books based on surrounding circumstances, as it could lead to subjective and notional income being taxed contrary to Article 265 of the Constitution. Since the assessee categorically denied paying the excess amount and the AO failed to establish an understatement of investment, the CIT(A) rightly deleted the addition. The Tribunal found no error of fact or law in the CIT(A)'s order. The issue is decided against the revenue and in favour of the assessee.
The Tribunal held that the AO failed to record proper satisfaction for disallowing the suo moto disallowance made by the assessee under Section 14A. The disallowance under Rule 8D(2)(ii) was deleted, and disallowance under Rule 8D(2)(iii) was restricted to investments yielding exempt income. The revenue's grounds regarding software expenses and inventory valuation were dismissed.
The Tribunal held that subsidies/incentives received under the New Sugar Promotion Policy are capital in nature, following its previous decisions. It also held that gains on foreign exchange fluctuation on the sale of a capital asset (shares of a subsidiary) are capital receipts.
The Tribunal held that the enhancement of addition by the CIT(A) was not sustainable as it was made without providing the assessee an opportunity to show cause, violating section 251(2). Regarding the additions made by the AO for loans from Devendra Pandey and Sanjay Pandey, the Tribunal found that the identity and genuineness of transactions were proved. The AO's reasons for doubting creditworthiness (non-furnishing of balance sheets and taking loans from others) were not maintainable.
The Tribunal held that subsidies/incentives received under the New Sugar Promotion Policy are capital in nature, following its previous decisions. It also held that gains on foreign exchange fluctuation on the sale of a capital asset (shares of a subsidiary) are capital receipts.
The Tribunal noted the assessee's failure to provide reasons for non-compliance and initially dismissed the appeal. However, considering the need for substantial justice, the Tribunal decided to set aside the ex-parte order.
The Tribunal held that the AO erred in rejecting the assessee's valuation report based on the DCF method, as the method was not inherently flawed and the AO did not provide substantial reasons to substitute his own valuation. The Tribunal also found that the assessee had discharged its onus under Section 68 by providing sufficient evidence regarding the source and genuineness of the loans.
The Tribunal held that the assessee's failure to file the return of income, even after a notice under Section 148, squarely falls under Explanation 3 to Section 271(1)(c), deeming it concealment of income. The plea of auditor's failure was rejected as the assessee's responsibility to file the return remains.
The Tribunal held that the reassessment proceedings were invalid as the AO initiated them based on suspicion and without any new or tangible material. The reasons for reopening were vague and did not specify the escaped income.
The Tribunal, considering the High Court's direction and various judicial precedents, held that share application money and investments not yielding exempt income should be excluded when computing disallowance under Section 14A r.w. Rule 8D(2)(iii).
The Tribunal held that subsidies/incentives received under the New Sugar Promotion Policy are capital in nature, following its previous decisions. It also held that gains on foreign exchange fluctuation on the sale of a capital asset (shares of a subsidiary) are capital receipts.
The Tribunal held that subsidies/incentives received under the New Sugar Promotion Policy are capital in nature, following its previous decisions. It also held that gains on foreign exchange fluctuation on the sale of a capital asset (shares of a subsidiary) are capital receipts.
The Tribunal held that subsidies received under the New Sugar Promotion Policy are capital in nature, consistent with previous rulings. It also held that gains arising from foreign exchange fluctuation on the sale of shares in a foreign subsidiary are capital receipts, as the shares represent a capital asset.
The assessment order passed in the name of a non-existent entity (BETL) after its amalgamation is invalid and bad in law. The assessee had duly informed the tax authorities about the amalgamation before the assessment order was passed.
The Tribunal held that a notice under section 143(2) of the Act is a mandatory requirement for reassessment proceedings after the filing of a return in response to a notice under section 148. The non-issuance of such a notice, as in this case, is not a mere procedural irregularity but a fatal defect that vitiates the reassessment order.
The Tribunal held that the reassessment orders were invalid and should be quashed because the Assessing Officer failed to issue a mandatory notice under Section 143(2) of the Income Tax Act after the assessee filed its return in response to the Section 148 notice. Relying on Supreme Court and High Court judgments, the Tribunal clarified that the non-issuance of a Section 143(2) notice is not a mere procedural irregularity but a fatal flaw, making the reassessment order unsustainable.
The assessee requested to withdraw the appeal, and the Departmental Representative did not oppose the prayer. The Tribunal accepted the assessee's request for withdrawal.
The Tribunal, considering the High Court's direction and various judicial precedents, held that share application money and investments not yielding exempt income should be excluded when computing disallowance under Section 14A r.w. Rule 8D(2)(iii).
The Tribunal held that expenditure incurred on abandoned projects, which represent an expansion of the existing business and do not result in the creation of a new asset of enduring benefit, is allowable as a revenue expenditure. The disallowance made by the revenue authorities was therefore incorrect.
The Tribunal held that while the AO had inquired into the investment in intangible assets, there was no specific inquiry into the claim of depreciation on goodwill. Therefore, the PCIT rightly invoked section 263 as the assessment order was passed without adequate verification of the claim.
The Tribunal upheld the CIT(A)'s decision, ruling that the sales tax/VAT subsidy and carbon credit income were capital receipts, referencing previous decisions in the assessee's own case and various High Court judgments. For the 80IA deduction, the Tribunal found no fault in the assessee's 'savings approach' for determining the market value of services from the captive rail system, considering relevant Supreme Court precedents.
The Tribunal held that Section 43CA of the Income Tax Act is not applicable as the assessee was acting as a contractor and not the owner of the property, and the allotted area was not held as stock-in-trade. Therefore, the addition made by the Assessing Officer was incorrect.
The Tribunal held that the inability to get accounts audited due to the genuine and bonafide dispute between the directors, which made it impossible for the company to obtain the necessary signatures, constituted a reasonable cause under Section 273B.
The Tribunal held that the inability to get accounts audited due to the genuine and bonafide dispute between the directors, which made it impossible for the company to obtain the necessary signatures, constituted a reasonable cause under Section 273B.
The Tribunal held that the disallowance of depreciation on goodwill was justified. However, it upheld the deletion of the disallowance made under Section 14A by the Assessing Officer, finding that the assessee had sufficient interest-free funds to cover its investments. The issue regarding the computation of book profit under Section 115JB was remanded to the AO.
The Tribunal noted that the lower appellate authority did not examine factual aspects. While acknowledging the CPC's adjustment based on the tax audit report, the Tribunal found it necessary to examine the taxability of the GST refund based on facts and accounting entries, which were not previously examined.
The Tribunal noted that no necessary verification was carried out due to the assessee's inability to represent his case. In the interest of justice, the Tribunal decided to remand the appeal back to the Assessing Officer for necessary verification of the issues based on the evidence filed by the assessee, ensuring a proper opportunity of being heard.
The Tribunal held that the disallowance of consultancy and legal fees amounting to Rs. 23,08,963/- was incorrect as the assessee had provided declarations and KYC of the individuals. For power and fuel expenses, the Tribunal allowed a deletion of Rs. 10,42,713/- due to submitted rent agreements supporting the claim, even if bills were in the name of property owners.
The Tribunal found that the notices were indeed sent to an incorrect email ID, leading to non-compliance by the assessee. The Tribunal also acknowledged the assessee's argument that issues should be decided on merit. Therefore, the Tribunal set aside the order of the Ld. CIT(A).
The Tribunal held that subsidies received under the New Sugar Promotion Policy are capital in nature, consistent with previous rulings. It also held that gains arising from foreign exchange fluctuation on the sale of shares in a foreign subsidiary are capital receipts, as the shares represent a capital asset.
The Tribunal observed that the AO failed to provide specific defects in the books of account as required by Section 145(3) of the Act. It was also noted that the addition made by the AO was confirmed by the CIT(A) based on previous assessment years, which were later overturned by the Tribunal. The Tribunal found no documentary evidence to contradict the assessee's details regarding sales and purchases.
The Tribunal noted that the CIT(A) granted relief based solely on transactions being routed through banking channels and repaid within the financial year. However, the assessee had not discharged the onus of proving the identity, creditworthiness, and genuineness of the loans by submitting necessary documents like confirmations from parties and ITRs of creditors. Therefore, the Tribunal was not in agreement with the CIT(A)'s decision.
The Tribunal noted that while the assessee's explanation for the cash deposits was not fully substantiated, the business was indeed conducted in cash. Therefore, the entire deposit could not be treated as undisclosed income. The Tribunal estimated a net profit of 8% on the cash deposits exceeding the disclosed sales to determine the undisclosed income from business.
The Tribunal consistently followed its earlier decisions in the assessee's own case, holding that no arrangement existed between the assessee and its AEs for AMP expenses, thus it was not an international transaction. Consequently, the AMP adjustment (Grounds 1-22) was deleted. The claim for excess DDT (Grounds 24-28) was dismissed as DTAA provisions were found inapplicable to DDT under Section 115-O. Penalty proceedings (Ground 29) were deemed premature and not adjudicated.
The Tribunal held that the AO erred in how refunds were adjusted and interest was calculated. It directed the AO to re-compute the interest, ensuring the refund is first adjusted against the interest component and then the balance towards the tax component. The issue of additional interest under Section 244A(1A) was restored to the AO for fresh examination.
The Tribunal held that the CIT(A) erred in confirming additions for loans from Krupa Suchak, Trupti Caterers, Saryu P. Shah, and Crown Fab International. The Tribunal found that the assessee had discharged the onus of proving the identity, creditworthiness, and genuineness of these transactions.
The Tribunal held that unsold flats, treated as stock-in-trade, cannot be assessed as 'Income from House Property'. Following its own previous decisions and other co-ordinate benches, the Tribunal directed the deletion of the addition.
The Tribunal found substance in the assessee's argument that non-operating income should be excluded from the comparable's margin. The TPO himself had excluded non-operating income from other comparables. The Tribunal directed the TPO to examine the details of other income of Polyspin Export Limited and allow deduction if it is not part of operating income, in line with other comparables.
The Tribunal held that the gift received from a relative, as defined in the Act, is wholly exempt from tax under Section 56(2)(X). The Tribunal noted that there was no transfer of shares by the assessee, and the cases cited by the CIT(A) were distinguishable as they related to capital gains on transfer.
The Tribunal held that the transfer of the property, as per Section 2(47) of the Income Tax Act read with Section 53A of the Transfer of Property Act, took place only upon the execution of the Deed of Transfer on 25/09/2007, not earlier. The cost of acquisition was directed to be re-computed, considering the amount paid for tenancy rights and conversion to ownership, with indexation benefit from 01/04/2005.
The Tribunal held that the provisions of Section 56(2)(x) are applicable when there is a discrepancy between the agreement price and the stamp duty value, and the registration occurs later than the agreement. However, a proviso allows for the stamp duty value on the date of agreement to be considered if a part of the consideration was paid through banking channels on or before the date of agreement. The assessee had made substantial payments via banking channels in 2010, prior to the registration in 2017, and the agreement date in 2012. Therefore, the stamp duty value as of the allotment date (2016) was considered, and since payments made exceeded this value, no addition was warranted.
The Tribunal held that the AO erred in how refunds were adjusted and interest was calculated. It directed the AO to re-compute the interest, ensuring the refund is first adjusted against the interest component and then the balance towards the tax component. The issue of additional interest under Section 244A(1A) was restored to the AO for fresh examination.