ITAT Nagpur Judgments — January 2017

The Tribunal held that the assessee's case was similar to previous precedents where penalty under Section 271AAA was deleted. The distinction made by the CIT(Appeals) regarding the nature of income was found to be unsustainable as the assessee had business income.

The Tribunal held that the evidence submitted by the assessee, including Gram Panchayat tax receipts and NOCs, sufficiently proved project completion, overriding the lack of a formal completion certificate. It also directed the AO to examine the proportionate disallowance for units violating the allotment condition.

The Tribunal noted that while the CIT(A) had granted substantial relief, the assessee's claim of agricultural income was not supported by cogent evidence. However, to serve the interest of justice, the issue of agricultural income through HUF for the balance addition was remitted back to the AO for fresh consideration.

The Tribunal found that the assessee was now in a position to produce creditors for verification and had submitted additional factual details. The Tribunal also noted that the AO had erred in refusing to issue notices under Section 131 and rejecting contentions.

The Tribunal held that the assessee had discharged their onus for the gift of Rs. 3,50,000/- and the sale of jewellery of Rs. 5,50,000/-, setting aside the additions. For the credit of Rs. 17,50,000/-, the Tribunal found the revenue authorities' rejection of the assessee's request for commission to be inappropriate and remitted the issue back to the Assessing Officer.

The Tribunal upheld the CIT(Appeals)'s decision, finding that the lands were indeed agricultural and located beyond the specified municipal limits. Therefore, the gain from their sale was not taxable as business income or capital gains.

The Tribunal found that the availability of interest-free funds for granting advances needed factual verification. Therefore, the issue of interest disallowance was remitted back to the Assessing Officer for re-examination.

The Tribunal found the CIT(Appeals)'s observation contradictory, as the assessee had not provided details to the AO. The Tribunal held that the matter should be remitted to the AO for examination of the submissions made before the CIT(Appeals) and to provide the assessee an opportunity to be heard.

The Tribunal upheld the CIT(Appeals)'s decision, finding that the stock was sufficiently explained as part of the opening balance and the interest-free advances were for business expediency. The AO's additions were not supported by adequate evidence.

The Tribunal held that the assessee society's activity of providing credit facilities to its members is covered under Section 80P(2)(a)(i). Consequently, the interest earned on deposits maintained for operational liquidity and to meet any eventuality towards repayment of deposits qualifies for deduction under this section.

The Tribunal held that the disallowance of job work charges was based on suspicion and surmises, as the assessee had provided bills, deducted TDS, and made payments through cheques. The disallowance of administrative expenses was also set aside as it was based on conjecture without specific reasons.

The Tribunal upheld the CIT(A)'s decision that the reopening of assessment was invalid as it was based on a change of opinion and the DVO's report from a third party without any fresh information. Therefore, the assessment was cancelled on jurisdictional grounds.

The Tribunal held that the assessee is eligible for exemption under Section 11, but the amount advanced as loans to related persons should be subjected to tax. The issue of disallowance under Section 40(a)(ia) and provision for salary/DA were remitted to the AO for verification.

The Tribunal held that the assessee society's activity of providing credit facilities to its members is covered under Section 80P(2)(a)(i). Consequently, the interest earned on deposits maintained for operational liquidity and to meet any eventuality towards repayment of deposits qualifies for deduction under this section.

The ITAT found that the CIT(Appeals) erroneously concluded the AO taxed the income based on the assessee's concession, whereas the AO decided on merits. The Tribunal remitted the issue back to the CIT(Appeals) for fresh consideration on merits.

The Tribunal held that Section 40(a)(ia) is attracted only if the sum is payable at the end of the year and not upon sums already paid. Since the royalty expenses were paid during the year and not outstanding, the disallowance was not justified.

The ITAT held that the CIT(Appeals) erred in dismissing the appeal for non-prosecution and should have adjudicated on merits. Following precedent, the Tribunal ruled that the assessee society is eligible for deduction under Section 80P(2)(a)(i).

The Tribunal held that the AO's failure to refer the matter to the DVO was inappropriate. Following the Calcutta High Court's decision, the issue was remitted back to the AO for valuation by the DVO.