ITAT Ranchi Judgments — April 2019

The Tribunal held that the Assessing Officer was obligated to refer the matter to the DVO under Section 50C(2) even if the assessee did not explicitly request it. The appeals were allowed to restore the issue to the Assessing Officer for fresh adjudication.

The Tribunal held that the notice for reassessment proceedings under Section 148 was not validly served on the Principal Officer of the assessee company. Consequently, the reassessment order passed pursuant to this notice is bad in law.

The Tribunal held that the Assessing Officer was obligated to refer the matter to the DVO under Section 50C(2) even if the assessee did not explicitly request it. The appeals were allowed to restore the issue to the Assessing Officer for fresh adjudication.

The Tribunal found that the CIT(A)'s order did not address the merits of the case and was passed without proper notice to the assessee. Therefore, the case was restored to the CIT(A) for fresh adjudication.

The Tribunal held that the quantum assessment and penalty proceedings are parallel, and not every addition warrants a penalty. The assessee had provided evidence for his agricultural income claim, which was sufficient to negate concealment or inaccurate particulars.

The Tribunal held that since incriminating material was found during a search on another entity and related to the assessees, Section 153C should have been applied. The AO erred in invoking Section 147, rendering the reassessment proceedings invalid.

The Tribunal held that the penalty orders under section 271(1)(c) were invalid due to a defective show-cause notice that failed to specify whether the penalty was for concealment of income or furnishing inaccurate particulars. The penalty under section 271AAB was deleted as the amount was accounted for in the suspense account and not undisclosed income.

The Tribunal held that the penalty orders under section 271(1)(c) were invalid due to a defective show-cause notice that failed to specify whether the penalty was for concealment of income or furnishing inaccurate particulars. The penalty under section 271AAB was deleted as the amount was accounted for in the suspense account and not undisclosed income.

The Tribunal held that the penalty orders under section 271(1)(c) were invalid due to a defective show-cause notice that failed to specify whether the penalty was for concealment of income or furnishing inaccurate particulars. The penalty under section 271AAB was deleted as the amount was accounted for in the suspense account and not undisclosed income.

The Tribunal noted that the assessee had succeeded on the identical issue in previous assessment years and that the Revenue had not pointed out any factual distinction. Therefore, the Tribunal directed the Assessing Officer to delete the disallowance.

The Tribunal found that while the assessee's claim of past savings was not fully substantiated, a complete addition of ₹5 lac was not justified. Therefore, a lump sum addition of ₹2.50 lac was considered just and proper.

The tribunal upheld the lower authorities' decision to tax the cash deposits as unexplained income. The assessee did not discharge the initial onus of proving the source of funds.

The Tribunal held that the primary consideration for granting registration under Section 12AA is the genuineness of the objects of the society. Since the hospital's objects were charitable (medical relief) and the pharmacy served in-house patients, the non-maintenance of separate books was not a valid ground for rejection.

The Tribunal held that since the assessee made part compliance and the assessment order was not passed under Section 144, the penalties levied under Section 271(1)(b) should be deleted. The Tribunal relied on a Delhi High Court judgment where subsequent compliance was considered good.

The Tribunal allowed the assessee's appeals regarding the reopening of assessments and the write-off of technical know-how expenses, finding the reopening invalid and the write-off to be a business expenditure. The Tribunal also dismissed the revenue's appeals concerning warranty expenses, sales promotion expenses, and horticulture expenses, deeming them allowable business expenditures.

The tribunal deleted the addition for warranty expenses based on the principle of consistency. For scientific research expenditure, the matter was remanded to the CIT(A) for further examination. The brand equity expenditure was also remitted back to the Assessing Officer for verification.

The Tribunal held that the gift was genuine as the donor had expired before the assessment, making it difficult to produce him. Regarding the fireworks purchases, the Tribunal noted the nature of the business and the necessity of cash transactions, deeming Section 40A(3) inapplicable, especially when profits were estimated.

The Tribunal noted that while the assessee possessed agricultural land, they failed to provide evidence of agricultural activities or sales. However, referencing a previous ruling, the Tribunal estimated agricultural income at Rs. 1,00,000 per acre per year and deleted the addition made by the AO.

The Tribunal found the addition made by the AO and confirmed by the CIT(A) to be on the higher side. Citing jurisdictional High Court decisions, the Tribunal restricted the addition to 5% of the profit on contract receipts and directed the AO to allow depreciation and partner's remuneration.

The tribunal deleted the addition for warranty expenses based on the principle of consistency. For scientific research expenditure, the matter was remanded to the CIT(A) for further examination. The brand equity expenditure was also remitted back to the Assessing Officer for verification.

The Tribunal held that the reopening of assessment was invalid as the information regarding LTA provision was already present in the audited accounts. It also allowed the write-off of technical know-how expenses as a business expenditure. Furthermore, the Tribunal dismissed the revenue's appeals concerning warranty expenses, sales promotion expenses, and horticulture expenses, finding them to be either not sustainable or valid business expenditures.

The Tribunal found that while the genuineness of expenses was not doubted, the assessee failed to provide complete evidence for verification. Therefore, the ad hoc disallowances were reduced from 10% to 5% for all disputed expense categories.

The Tribunal held that trade advances are not covered under Section 2(22)(e) of the Act. Therefore, the order of the CIT(A) deleting the addition made by the AO was upheld.

The Tribunal found no infirmity in the CIT(A)'s order, noting that it was a reasoned order. The CIT(A) had correctly identified that the AO had considered opening balances as purchases and restricted the addition to the actual verifiable difference.

The Tribunal held that the reopening of assessment was invalid as the information regarding LTA provision was already present in the audited accounts. It also allowed the write-off of technical know-how expenses as a business expenditure. Furthermore, the Tribunal dismissed the revenue's appeals concerning warranty expenses, sales promotion expenses, and horticulture expenses, finding them to be either not sustainable or valid business expenditures.

The Tribunal upheld the CIT(A)'s decision, stating that interest on deep discount bonds is taxable only at maturity and that unclaimed deposits in a banking company's suspense account do not constitute income. The Tribunal found no infirmity in the CIT(A)'s reasoned orders.

The Tribunal found no infirmity in the CIT(A)'s order, which was passed after considering all facts and circumstances. The CIT(A) had correctly calculated the LTCG and allowed relief to the assessee.

The Tribunal deleted the disallowance of labour and wages expenses, finding them verifiable. For the capital gains issue, the Tribunal remanded the matter to the Assessing Officer to determine if the land was held as stock-in-trade or a capital asset.