ITAT Surat Judgments — August 2018

The Tribunal deleted the addition of Rs. 5,22,000 under Section 41(1) as the conditions for remission or cessation of liability were not met. For the cash credits, the Tribunal deleted the addition of Rs. 80,000 as it was a payable amount reflected in the balance sheet, but confirmed the addition of Rs. 7 Lakhs due to lack of details and non-reflection in the balance sheet.

The Tribunal held that the Revenue's appeal was not maintainable due to the low tax effect, which fell below the revised monetary limit set by the CBDT. The Cross Objection filed by the assessee was dismissed as not pressed.

The Tribunal held that delayed payments of employee's contribution to PF/ESI are not deductible, following the jurisdictional Gujarat High Court's decision. The dismissal of an SLP by the Supreme Court in a similar case was deemed not to constitute a binding precedent.

The Tribunal upheld the CIT(A)'s deletion of the protective addition. Since the substantive additions in the hands of the three brothers had attained finality, the protective addition in the assessee's hands was no longer sustainable.

The Tribunal held that the appeal was not maintainable as per CBDT Circular No. 3/2018, which revised the monetary limit for filing appeals to the Tribunal to Rs. 20 Lakhs. The case did not fall under any of the exceptions provided in the circular.

The Tribunal held that the Revenue's appeal was not maintainable as per the CBDT's Circular No. 3/2018, which revised the monetary limit for filing appeals to Rs. 20 Lakhs. The Assessee's cross-objection was dismissed as not pressed.

The Tribunal deleted penalties related to repairs, prior period expenses, restructuring expenses, and tank insulation charges as the underlying additions were deleted or restored to the AO. However, the penalty on depreciation on foreign exchange loss was upheld, and the penalty on FBT provision was also upheld.

The Tribunal held that the rejection of books of accounts was not justified due to the huge resale of raw materials, which skewed the GP ratio. The disallowance of interest expenditure was also deleted as the assessee had sufficient interest-free funds. However, the ad-hoc disallowance of salary and wages was upheld due to the failure to produce supporting documents.

The Tribunal deleted the addition of Rs. 3,50,000/- related to M/s. Delux Recycling India Pvt. Ltd. as it was found to be a mistaken entry. However, the additions for the remaining ten parties were upheld due to the assessee's failure to reconcile the differences.

The Tribunal deleted penalties related to repairs, prior period expenses, restructuring expenses, and tank insulation charges as the underlying additions were deleted or restored to the AO. However, the penalty on depreciation on foreign exchange loss was upheld, and the penalty on FBT provision was also upheld.

The Tribunal deleted penalties related to repairs and tank insulation charges as the underlying additions were deleted by ITAT. Penalties for prior period expenses were also deleted as the addition was restored to the AO. However, the penalty for depreciation on foreign exchange loss was upheld, and the penalty for FBT provision was also upheld.

The Tribunal held that the appeal was not maintainable as the tax effect was below the revised monetary limit of Rs. 20 Lakhs set by CBDT Circular No. 3/2018. The case did not fall under any of the exceptions provided in the circular.

The Tribunal held that the appeal was not maintainable as per the revised monetary limit for filing appeals set by CBDT Circular No. 3/2018. The appeal did not fall within any of the exceptions provided in the circular.

The Tribunal held that the assessee failed to provide sufficient evidence to substantiate the source of cash deposits, particularly regarding the opening cash balance and the benefit of telescoping. The explanations offered were considered insufficient and lacking in documentary support.

The Tribunal held that the benefit of telescoping or peak credit could not be allowed for the cash deposits. The assessee failed to provide sufficient evidence to substantiate the source of the cash deposits, and the explanations offered were considered inconsistent.

The Tribunal held that the assessee failed to provide sufficient evidence to substantiate the source of cash deposits, particularly regarding the opening cash balance and the benefit of telescoping. The explanations offered were considered insufficient and lacking in documentary support.

The Tribunal held that the assessee failed to provide sufficient evidence to substantiate the source of cash deposits, particularly regarding the opening cash balance and the benefit of telescoping. The explanations offered were considered insufficient and lacking in documentary support.

The Tribunal held that the assessee failed to provide sufficient evidence to substantiate the source of cash deposits, particularly regarding the opening cash balance and the benefit of telescoping. The explanations offered were considered insufficient and lacking in documentary support.

The Tribunal held that the appeal was not maintainable as per CBDT Circular No. 3/2018, which revised the monetary limit for filing appeals to the Tribunal to Rs. 20 Lakhs. The case did not fall under any exceptions.

The Tribunal held that the principle of 'audi alteram partem' (hear the other side) is a fundamental concept of natural justice. Since the assessee was not given a proper hearing, the Tribunal restored the appeal to the file of the Assessing Officer for a de novo assessment.

The Tribunal held that the stamp duty value on the date of the agreement to sell should be considered for Section 50C if part payments were received via account payee cheques before the registration date. The proviso to Section 50C, though inserted later, was considered applicable retrospectively.

The Tribunal held that the entire cash deposits could not be treated as income as they were linked to payments made to the insurance company on behalf of clients. It was decided that either gross profit or peak credit could be estimated.

The Tribunal held that the appeal was not maintainable as per the CBDT Circular No. 3/2018, which revised the monetary limit for filing appeals to the Tribunal to Rs. 20 Lakhs. The present case did not fall under any of the exceptions provided in the circular.

The Tribunal held that the assessee was engaged in a small business of fruit trading, and the entire cash deposits could not be treated as income. The addition was directed to be calculated at 5% of the total credits as per Section 44AF of the Act.

The Tribunal held that as per CBDT Circular No. 3/2018, appeals with a tax effect below Rs. 20 Lakhs are not maintainable, unless they fall under specific exceptions. Since this case did not fall under any exception, the appeal was dismissed.

The Tribunal held that the appeal was not maintainable as per the revised monetary limit for filing appeals before the Tribunal. The appeal was dismissed on this ground.

The Tribunal held that the appeal was not maintainable as per CBDT Circular No. 3/2018, which revised the monetary limit for filing appeals to the Tribunal to Rs. 20 Lakhs. The case did not fall under any of the exceptions provided in the circular.

The Tribunal found that the additional evidence submitted by the assessee required re-examination by the AO. Since the assessee was not given an opportunity to be heard on this evidence, the assessment was set aside for de-novo consideration.

The Tribunal held that the appeal was not maintainable as per the CBDT Circular No. 3/2018, which revised the monetary limit for filing appeals to Rs. 20 Lakhs. The present case did not fall under any of the exceptions provided in the circular.

The assessee filed an application seeking permission to withdraw the appeal. The Tribunal accepted the assessee's request for withdrawal.

The Tribunal held that the generation of electricity is akin to the manufacture or production of an article or thing, entitling the assessee to additional depreciation. The amendment in 2012 was seen as clarifying rather than restricting the existing eligibility.

The Tribunal held that foreign exchange fluctuation gains are part and parcel of export profits and scrap sales are directly connected to the manufacturing activity. Therefore, these amounts are eligible for deduction under Section 80IC.

The Tribunal held that the explanation offered by the assessee during penalty proceedings was not found to be false. Therefore, the AO was not justified in levying the penalty under Section 271(1)(c).

The Tribunal dismissed the Revenue's appeal as not maintainable due to the low tax effect, citing a CBDT circular. The Assessee's Cross Objection was dismissed as not pressed.

The Tribunal held that the proviso to Section 2(15) of the Income Tax Act, 1961, is applicable to the Assessment Year 2010-11. However, it found that the assessee's activities, including the Sthapatya Exhibition, were not carried out with a motive to earn profit. The surplus generated from the exhibition was considered incidental to the fulfillment of the trust's charitable objects, which are to promote the efficiency of architects and civil engineers and provide education. The Tribunal noted that the trust is registered with the Charity Commissioner and under Section 12A/12AA, and its primary objects are charitable. The Tribunal relied on judicial pronouncements, including those from the Hon'ble High Courts, which state that if the object of a trust is charitable, any surplus arising from its activities is secondary and not hit by the proviso to Section 2(15), provided the activities are not carried out on commercial lines with an intention to make profits. Therefore, the Tribunal directed that the assessee was entitled to the exemption under Section 11 of the Act. Grounds No. 1 to 3 were allowed.