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604 orders · Page 3 of 13
The Tribunal held that if the addition made emanating from the 'reason to believe' for reopening is deleted at any appellate stage, then any other addition made during reassessment which is not part of the 'reason to believe' would not survive. In this case, the reason for reopening was the disallowance under Section 40(a)(ia) for non-deduction of TDS on payments for alternate accommodation. While the AO also made a disallowance under Section 36(1)(va) for belated PF/ESI remittance, this was not the primary reason for reopening. The CIT(A) deleted the Section 40(a)(ia) disallowance, and the revenue did not appeal. The Tribunal found that the surviving disallowance under Section 36(1)(va) did not emanate from the original reasons for reopening but from the explanation to Section 147. Following the ratio laid down in the cited judicial precedents, including the Hon'ble High Court and Coordinate Benches, the Tribunal directed the AO to delete the disallowance made under Section 36(1)(va) for all the assessment years. The alternate contention regarding the validity of reopening due to the absence of a survey other than under Section 133A(2A) was rendered academic and left open.
The Tribunal held that claiming deduction under Section 80G for donations made from CSR expenditure is permissible if the conditions of Section 80G are met, as it is independent of the disallowance under Section 37(1) for CSR expenses. The PCIT's revisionary order was found to be erroneous as the Assessing Officer had taken a plausible view.
The Tribunal held that the approval for issuing the notice under Section 148 was obtained from an authority not specified under Section 151 of the Act for reassessment proceedings initiated beyond three years. Therefore, the notice was invalid, and the reassessment proceedings were quashed.
The Tribunal held that the AO's addition was made on an ad-hoc basis, considering only credit entries without accounting for corresponding debit entries. The commission income was also already offered to tax by the assessee.
The Tribunal held that if the primary reason for reopening under Section 147 is deleted, any other additions made during reassessment that were not part of the original reasons for reopening cannot be sustained. Consequently, the disallowance under Section 36(1)(va) was also deleted.
The Tribunal held that the assessee had discharged its onus by providing sufficient documentary evidence, and the Assessing Officer had not brought on record evidence to prove the loans were not genuine. The additions made by the Assessing Officer were therefore uncalled for.
The Tribunal held that the assessee cannot be made to prove a negative and that the revenue failed to bring cogent evidence to negate the assessee's claim of not having made purchases from Millennium Concern. The addition made by the Assessing Officer was deleted.
The Tribunal held that the assessee had provided documentary evidence and confirmations for the unsecured loans. It noted that four of the five lenders had been confirmed as genuine by previous Tribunal decisions. Relying on judicial precedents, the Tribunal found that the Assessing Officer had not brought sufficient evidence to controvert the genuineness of the transactions.
The Tribunal held that the assessee had discharged its onus by providing sufficient documentary evidence, and the Assessing Officer had not brought on record evidence to prove the loans were not genuine. The additions made by the Assessing Officer were therefore uncalled for.
The Tribunal held as follows: 1. **On the issue of the assessment order being time-barred:** The assessee did not press this ground, and it was dismissed as infructuous. 2. **On interest on overdue receivables:** The Tribunal held that delayed receivables, being in the nature of a debt arising during the course of business, fall squarely within the statutory definition of an international transaction under section 92B, as amended in 2012. The Tribunal rejected the assessee's contention that it was subsumed in working capital adjustment, stating that such subsumption requires a reliable computation of monthly receivables/payables, that receivables do not exceed industry standards, and that the adjustment demonstrably captures the impact of delays. The assessee failed to provide such data. The Tribunal also rejected the argument that the assessee being debt-free made the adjustment unwarranted, as transfer pricing is not contingent on actual expenditure but on what independent parties would charge. The argument regarding AE vs. non-AE receivable cycles was also rejected due to unsubstantiated data. The TPO's methodology of applying the 'other method' using safe harbour rates (LIBOR + 400 bps) was found to be justified. Grounds 3 to 6 were dismissed. 3. **On corporate guarantee commission:** The Tribunal held that the provision of corporate guarantee to AEs is explicitly recognized as an international transaction under section 92B, as clarified by the 2012 amendment. The argument that it is a shareholder activity was rejected, as it involves assumption of risk and provision of financial services. The TPO's reasoned approach in adjusting bank guarantee rates to arrive at an ALP of 1.4% was found to be consistent with judicial precedents and within reasonable bounds, considering safe harbour rules. The adjustment made by the TPO was found to be factually and legally correct. Grounds 7 and 8 were dismissed. 4. **On sundry creditors written back:** The Tribunal directed the Assessing Officer to attend to the assessee's rectification application on priority and decide the issue, allowing the ground for statistical purposes. 5. **On credit of prepaid taxes:** The Tribunal noted that this issue did not arise from the impugned order but directed the assessee to file an application before the AO for allowing credit as per law, allowing the ground for statistical purposes. 6. **On penalty and interest:** The Tribunal held that the initiation of penalty proceedings was premature and the charge of interest was consequential, thus not requiring adjudication at this stage. The appeal was partly allowed for statistical purposes.
The Tribunal held that the assessee cannot be treated as an 'assessee in default' if the payees have discharged their tax liability, or if the taxability is yet to be determined and discharged. Interest under Section 201(1A) can only be charged up to the date of tax payment by the deductee.
The Tribunal held that the amendment to Section 11(3) by the Finance Act, 2022, which removed the additional year for utilization, was prospective. Since the utilization occurred before 31.03.2023, within the period allowed under the law at the time of accumulation, the addition was deleted.
The Tribunal held that the assessee is entitled to carry forward the long-term capital loss of ₹17,96,11,994 to subsequent years as per Section 74 of the Act. The Tribunal reasoned that the choice between the Income Tax Act and the DTAA provisions applies to each stream of income, not the head of income. Gains from shares acquired before 01.04.2017 were exempt under Article 13(4) of the India-Mauritius DTAA, which was accepted by the Revenue. The LTCL arose from the sale of shares acquired after 01.04.2017. These were distinct transactions, constituting separate sources of income. Therefore, the LTCL could be carried forward under Section 74 of the Act, and dividend income from "income from other sources" could not be adjusted against this LTCL. The Tribunal relied on decisions in IBM World Trade Corpn., Dimension Data Asia Pacific Pte. Ltd., and Montgomery Emerging Markets Fund, holding that Section 90(2) of the Act applies to each stream of income. The CIT(A)'s reliance on Indium IV Mauritius Holdings Ltd. was considered misplaced. Grounds 1 to 4 were allowed. Ground 5 was rendered infructuous. The AO was directed to allow the carry forward of LTCL.
The Tribunal held that the assessee cannot be treated as an 'assessee in default' if the payees have discharged their tax liability, or if the taxability is yet to be determined and discharged. Interest under Section 201(1A) can only be charged up to the date of tax payment by the deductee.
The Tribunal noted that the assessee failed to appear and substantiate its claims. The CIT(A) had deleted the additions based on the assessee's submissions and documentary evidence, which the AO allegedly did not properly consider. The Tribunal decided to adjudicate the matter ex-parte.
The Tribunal held that the period from 15.03.2020 to 28.02.2022 should be excluded for the purpose of limitation due to the COVID-19 pandemic, as directed by the Supreme Court. The First Appellate Authority's order disregarded this direction.
The Tribunal held that the PCIT erred in invoking Section 263 as the AO had taken a possible view, relying on jurisdictional High Court and Tribunal rulings. The PCIT's order was found to be without jurisdiction and bad in law.
The Tribunal held that ULIPs should be considered capital assets and the redemption proceeds taxed under the head 'Capital Gains', not 'Income from Other Sources'. It also directed the AO to allow indexation and credit for TDS.
The Tribunal held that the assessee cannot be treated as an 'assessee in default' if the payees have discharged their tax liability, or if the taxability is yet to be determined and discharged. Interest under Section 201(1A) can only be charged up to the date of tax payment by the deductee.
The Tribunal held that the assessee cannot be treated as an 'assessee in default' if the payees have discharged their tax liability, or if the taxability is yet to be determined and discharged. Interest under Section 201(1A) can only be charged up to the date of tax payment by the deductee.
The Tribunal held that the notice issued under section 148 for AY 2015-16 was barred by limitation, following the Supreme Court's concession that such notices issued after April 1, 2021, would be dropped. Consequently, the reassessment proceedings were quashed.
The Tribunal held that the loan advanced to another charitable trust with similar objects qualifies as an application of income under Section 11. It also upheld the CIT(A)'s finding that there was no violation of Section 13 due to the common trustee.
The Tribunal noted that the assessee had submitted new documents and evidence at the appeal stage. In the interest of justice, the Tribunal decided to remit the issue back to the AO for de novo verification of the evidence furnished by the assessee, ensuring a proper opportunity of being heard.
The Tribunal held that ad hoc disallowances are not permissible without rejecting the books of accounts or pointing out specific defects. Since the AO and CIT(A) did not reject the books or identify specific deficiencies, the disallowances were uncalled for.
The Tribunal held that the Principal CIT cannot assume revisionary jurisdiction under Section 263 over an assessment order passed pursuant to DRP directions. The DRP process is a correction mechanism, and a single CIT is not superior to the DRP collegium.
The Tribunal held that the assessee cannot be treated as an 'assessee in default' if the payees have discharged their tax liability, or if the taxability is yet to be determined and discharged. Interest under Section 201(1A) can only be charged up to the date of tax payment by the deductee.
The Tribunal dismissed the Revenue's appeal, finding that the CIT(A) was correct in deleting the additions related to unsecured loans and interest. The Tribunal partly allowed the assessee's cross-objection, deleting the addition for maintenance charges but directing withdrawal of TDS credit.
The Tribunal held that the Assessing Officer acted within the scope of the limited scrutiny mandate. The PCIT erred in invoking Section 263 as the issue of unsecured loans was outside the limited scope of scrutiny. Therefore, the PCIT's order was set aside, and the Assessing Officer's order was reinstated.
The Tribunal held that the loan advanced to K. R. Foundation qualifies as an application of income under Section 11 of the Income Tax Act, 1961. The Tribunal relied on judicial precedents and CBDT Circular No. 100 dated 24.01.1973, which state that money advanced to another charitable trust with similar objects can be treated as application of income. The Tribunal noted that the assessee had offered the repaid amounts as income in subsequent assessment years. The Tribunal also observed that the departmental authorities had not questioned such claims in prior and subsequent assessment years, except for the disputed years. Regarding the Revenue's grounds concerning violations of Section 13(1)(c) and 13(2)(h) due to common trustees, the Tribunal agreed with the First Appellate Authority that none of the conditions specified in Section 13(3) applied to the assessee's case. Therefore, the Tribunal held that the provisions of Section 13(1)(c) and Section 13(2) of the Act were not applicable to deny the assessee's claim for exemption under Section 11. The issue of interest under Sections 234B and 234C was not specifically adjudicated as it was dependent on the primary issue of application of income, and the Tribunal stated that other issues raised by the assessee were kept open.
The Tribunal held that the amendment to Section 11(3) of the Income Tax Act, which restricted the utilization period, was prospective. Since the utilization occurred in the year immediately following the prescribed five-year period and before the amendment's effective date, the addition was unjustified.
The Tribunal held that appellate authorities have jurisdiction to admit additional claims even if the Assessing Officer or CIT(A) did not, contrary to the Assessing Officer's reliance on the Goetz India Ltd. decision. The matter was restored to the Assessing Officer for verification of the assessee's residential status.
The Tribunal held that the assessee cannot be treated as an 'assessee in default' if the payees have discharged their tax liability, or if the taxability is yet to be determined and discharged. Interest under Section 201(1A) can only be charged up to the date of tax payment by the deductee.
The Tribunal held that the assessee had discharged its onus by providing sufficient documentary evidence, and the Assessing Officer had not brought on record evidence to prove the loans were not genuine. The additions made by the Assessing Officer were therefore uncalled for.
The Tribunal held that the CIT(A) had failed to consider the documentary evidence filed by the assessee and had not gone into the merits of the issue. Therefore, the Tribunal restored the issue back to the CIT(A) for a fresh adjudication.
The Tribunal held that the assessee had provided sufficient evidence of cash withdrawals in preceding years to explain the deposits. Therefore, the additions sustained by the CIT(A) were unsustainable.
The Tribunal held that penalty under section 271(1)(c) is not leviable when the addition is made on an estimation or ad-hoc basis. Following established legal precedents, the penalty sustained by the CIT(A) to the extent of Rs. 5,59,500/- was deleted.
The Tribunal held that it was unable to evaluate the facts and reasons for additions due to the missing pages of the assessment order. Therefore, the matter was restored back to the Assessing Officer (AO) to pass a fresh assessment order after providing an opportunity of hearing.
The Tribunal held that the assessee has discharged its burden of showing reasonable cause for the failure to get its books of accounts audited within the meaning of Section 273B of the Income-tax Act, 1961. The Tribunal noted that the partners were educationists with no background in tax compliance, relied on their tax consultant whose negligence caused the lapse, and that upon detection, the assessee immediately got its books audited and filed its return. Furthermore, the entire tax liability had been settled under the Vivad-se-Viswas Scheme, 2024, with taxes and interest duly discharged, and subsequent compliance has been regular. These facts collectively establish that the failure was not willful but attributable to a reasonable cause. The Tribunal found that the lower authorities failed to appreciate the substance of the assessee's explanation and the bona fide conduct. Since reasonable cause is established, Section 273B operates as a complete defense to the levy of penalty. Consequently, the Tribunal set aside the orders of the lower authorities and deleted the penalty levied for not getting the books of accounts audited on time for all assessment years under appeal. The issue of whether the Vivad-se-Viswas Scheme, 2024, provided immunity from penalty was not expressly decided as the primary ground for deletion was reasonable cause.
The Tribunal held that a cooperative bank is not required to deduct TDS on interest paid to other cooperative societies. This decision was based on High Court rulings, previous acceptance by revenue in similar cases for the appellant, and the insertion of specific provisions related to rationalization of tax deduction on interest.
The Tribunal held that the issue of allowing CSR expenditure as a deduction under Section 80G is a debatable issue, and such issues cannot be grounds for assuming jurisdiction under Section 263. The Tribunal relied on the Bombay High Court's ruling in PCIT vs. Postal Gujarat Power Ltd.
The Tribunal upheld the decision of the learned CIT(A) and dismissed the appeal filed by the Revenue. The Tribunal found that the assessee's consistent claim was that the sum of Rs. 5,26,41,905 was inadvertently reported in Schedule-I of the ITR for AY 2018-19 due to a 'punching error'. The assessee's contention that all accumulated funds from previous assessment years, up to FY 2015-16, were spent during FY 2016-17, leaving no accumulated funds to be spent in the year under consideration, was supported by the details filed by the assessee during assessment proceedings. The Tribunal noted that the balance accumulation in FY 2016-17 was negative (INR (32,75,233)). The Tribunal agreed with the assessee that due to the 'punching error', the sum of Rs. 5,26,41,905 was inadvertently reported. Regarding the AO's reliance on Goetze (India) Ltd, the Tribunal held it to be erroneous because the assessee did not claim any deduction in the current year's return based on accumulated funds of preceding years, nor did they make such a claim during assessment proceedings. Therefore, the Tribunal found no infirmity in the CIT(A)'s findings and upheld the deletion of the addition. The grounds raised by the Revenue were dismissed.
The Tribunal held that the CIT(A) erred in dismissing the appeal without considering the merits, especially since an earlier appeal might have been filed within the limitation period. The matter was remitted back to the CIT(A) for adjudication on merits.
The Tribunal noted that the quantum of penalty was hit by a CBDT circular regarding monetary limits for appeals. The appeal was dismissed as withdrawn based on this circular.
The Tribunal upheld the CIT(A)'s decision to restrict the addition to 12.5% of the bogus purchases, citing the principle of consistency with previous assessment years and judicial precedents.
The Tribunal condoned the delay in filing the appeal by the Revenue. The Tribunal noted that the appeal by the Revenue was against the order of the CIT(A) which had followed a previous ITAT decision. The Tribunal observed that the Assessing Officer had treated payments for Global technology/Knowledge management, Global Communication, and Global Brand as royalty under section 9(1)(vi) of the Act and Article 13 of the India-UK DTAA. The Assessing Officer had directed tax deduction at source on a pro-rata basis. The CIT(A) had directed the refund of taxes paid pursuant to the section 195(2) order. The Tribunal did not decide the merits of the case in the provided excerpt, but rather focused on procedural aspects like condonation of delay and the context of the appeal. The judgment excerpt does not contain the final decision on the substantive issues.
The Tribunal held that the penalty was not leviable as the transfer pricing adjustment arose solely from a difference of opinion on comparable selection, not from concealment or inaccurate particulars. The assessee had acted in good faith and with due diligence, fulfilling the conditions of Explanation 7 to Section 271(1)(c).
The Tribunal found significant discrepancies in the purchase amounts and party names between the assessment order and remand report, and also noted the absence of a show-cause notice for depreciation disallowance. Therefore, both grounds were restored to the AO for fresh adjudication.
The Tribunal held that while the Assessing Officer had referred the matter to the DVO during remand proceedings, the CIT(A) failed to provide the assessee with a proper opportunity to file objections to the DVO's report. Therefore, the matter was restored to the CIT(A) for providing this opportunity.
The Tribunal held that while there were suspicious features like abnormal sales and delayed VAT returns, the law requires conclusive evidence. Since the Revenue failed to provide evidence that the deposited cash was unaccounted money, Section 68 could not be invoked. The purchases were also found to be genuine.
The Tribunal held that the imposition of penalty by the Assessing Officer was premature because the quantum appeal, which forms the basis of the penalty, was still pending before the CIT(A). Therefore, the penalty order was set aside.