ITAT Pune Judgments — October 2023

The Tribunal held that the expense incurred for transporting water for bamboo trees was not linked to the business of earning lease rental income from a liquor license. Therefore, it could not be allowed as a deduction against that income.

The Tribunal held that the disallowance of employee's contribution to ESI/EPF made after the statutory due date is correct as per Section 36(1)(va) and the Supreme Court ruling in Checkmate Services. However, the employer's contribution, if paid before the due date for filing the return, should be allowed as a deduction.

The Tribunal allowed the assessee's appeals, quashing all three impugned assessments. The ITAT followed the Supreme Court's decision in PCIT vs. Abhisar Buildwell P. Ltd., which held that for unabated assessments under section 153A, additions must be based on incriminating material found during the search. The Tribunal found that the assessee had indeed filed regular returns for the assessment years in question, refuting the Revenue's claim of the assessee being a 'non-filer'. The Tribunal further held that a survey action under section 133A cannot be considered as part of a search under section 132 for the purpose of triggering section 153A proceedings, citing a strict interpretation of the law and the decision in Commissioner of Customs (Imports), Mumbai vs. M/s. Dilip Kumar And Co. & Ors. The Tribunal also noted its own prior order in the assessee's case for assessment year 2008-2009, which had decided the same legal issue in favor of the assessee. The ITAT concluded that since the impugned additions were not based on any incriminating material found or seized during the search, the assessments were not sustainable in law. All other pleadings were rendered academic.

The Tribunal allowed the assessee's appeals, quashing all three impugned assessments. The ITAT followed the Supreme Court's decision in PCIT vs. Abhisar Buildwell P. Ltd., which held that for unabated assessments under section 153A, additions must be based on incriminating material found during the search. The Tribunal found that the assessee had indeed filed regular returns for the assessment years in question, refuting the Revenue's claim of the assessee being a 'non-filer'. The Tribunal further held that a survey action under section 133A cannot be considered as part of a search under section 132 for the purpose of triggering section 153A proceedings, citing a strict interpretation of the law and the decision in Commissioner of Customs (Imports), Mumbai vs. M/s. Dilip Kumar And Co. & Ors. The Tribunal also noted its own prior order in the assessee's case for assessment year 2008-2009, which had decided the same legal issue in favor of the assessee. The ITAT concluded that since the impugned additions were not based on any incriminating material found or seized during the search, the assessments were not sustainable in law. All other pleadings were rendered academic.

The Tribunal allowed the assessee's appeals, quashing all three impugned assessments. The ITAT followed the Supreme Court's decision in PCIT vs. Abhisar Buildwell P. Ltd., which held that for unabated assessments under section 153A, additions must be based on incriminating material found during the search. The Tribunal found that the assessee had indeed filed regular returns for the assessment years in question, refuting the Revenue's claim of the assessee being a 'non-filer'. The Tribunal further held that a survey action under section 133A cannot be considered as part of a search under section 132 for the purpose of triggering section 153A proceedings, citing a strict interpretation of the law and the decision in Commissioner of Customs (Imports), Mumbai vs. M/s. Dilip Kumar And Co. & Ors. The Tribunal also noted its own prior order in the assessee's case for assessment year 2008-2009, which had decided the same legal issue in favor of the assessee. The ITAT concluded that since the impugned additions were not based on any incriminating material found or seized during the search, the assessments were not sustainable in law. All other pleadings were rendered academic.

The Tribunal held that investment of net consideration in fixed deposits for 6 months or above is regarded as utilization for acquiring another capital asset, following Board circulars and High Court judgments. Therefore, the interest component of the compensation was to be treated as application of income.

The Tribunal held that the NFAC's dismissal for non-prosecution without considering the merits was unreasonable and unjustified. The matter was remanded back to the NFAC for adjudication on merits.

The Tribunal held that the AO's additions were not justified as they were based on third-party proceedings before the ITSC, where the assessees had no role. The seized documents and the third-party statements lacked clarity and independent corroboration to establish the alleged cash payments of interest by the assessees.

The Tribunal held that the AO's additions were not justified as they were based on third-party proceedings before the ITSC, where the assessees had no role. The seized documents and the third-party statements lacked clarity and independent corroboration to establish the alleged cash payments of interest by the assessees.

The Tribunal held that the AO's additions were not justified as they were based on third-party proceedings before the ITSC, where the assessees had no role. The seized documents and the third-party statements lacked clarity and independent corroboration to establish the alleged cash payments of interest by the assessees.

The Tribunal held that the AO's additions were not justified as they were based on third-party proceedings before the ITSC, where the assessees had no role. The seized documents and the third-party statements lacked clarity and independent corroboration to establish the alleged cash payments of interest by the assessees.

The Tribunal held that the AO's additions were not justified as they were based on third-party proceedings before the ITSC, where the assessees had no role. The seized documents and the third-party statements lacked clarity and independent corroboration to establish the alleged cash payments of interest by the assessees.

The Tribunal held that the AO cannot insist on substituting the Percentage Completion Method for the Project Completion Method without demonstrating that the latter distorts profits. The assessee's agreement was for a future year, and the revenue neutrality principle also supported the assessee.

The Tribunal held that the AO's additions were not justified as they were based on third-party proceedings before the ITSC, where the assessees had no role. The seized documents and the third-party statements lacked clarity and independent corroboration to establish the alleged cash payments of interest by the assessees.

The Tribunal held that the AO's additions were not justified as they were based on third-party proceedings before the ITSC, where the assessees had no role. The seized documents and the third-party statements lacked clarity and independent corroboration to establish the alleged cash payments of interest by the assessees.

The Tribunal found that the assessee had reasonable cause for not responding to the notices. Therefore, the assessment order was set aside and remanded back to the Assessing Officer for fresh adjudication.

The Tribunal held that the AO's additions were not justified as they were based on third-party proceedings before the ITSC, where the assessees had no role. The seized documents and the third-party statements lacked clarity and independent corroboration to establish the alleged cash payments of interest by the assessees.

The Tribunal held that dismissing the appeal for non-prosecution without adjudicating on merits was unreasonable and unjustified. The National Faceless Appeal Centre (NFAC) committed a serious error by not admitting the appeal for non-prosecution.

The Tribunal held that the land acquisition award was made on 02.02.2010, and the land was taken over on 8th September 2010. Therefore, there was no transfer of capital asset in the previous year relevant to AY 2009-10, and no Long Term Capital Gain arose for this assessment year.

The Tribunal held that the interest income earned by the cooperative society from fixed deposits with cooperative banks is eligible for deduction under Section 80P(2)(a)(i) of the Act. The addition made by the Assessing Officer was directed to be deleted.

The ITAT held that the CIT(A) should not have dismissed the appeal on a minor deficiency without giving the assessee an opportunity to rectify it. The matter was restored to the CIT(A) for a fresh decision.

The Tribunal held that there was a direct nexus between the interest earned and the interest paid by the assessee. Therefore, only the net interest should be considered, and the addition made by the Assessing Officer was directed to be deleted.

The Tribunal set aside the impugned ex parte order and restored the matter to the Assessing Officer for a fresh assessment. The assessee will be given a reasonable opportunity of hearing and liberty to lead evidence.

The Tribunal condoned the delay in filing the appeal. It held that since both the assessment and first appellate orders were passed ex parte, it would be just and fair to set aside the impugned order and remit the matter back to the Assessing Officer.