ITAT Surat Judgments — June 2021

The Tribunal held that once the assessee furnishes basic documents like confirmations, bank statements, and IT returns of share applicants, the onus under Section 68 is discharged. Any doubts about the source can be investigated in the assessment of the share applicants.

The Tribunal condoned the 29-day delay in filing the appeal, finding it neither intentional nor deliberate but due to the accountant's fault and casual approach, emphasizing that substantial justice should prevail over technical considerations. Regarding the main issues, the Tribunal held that the amended provisions of Section 55A, which came into effect from 01.07.2013, were not applicable to the transaction of sale of land which occurred during the financial year 2011-12, relevant to Assessment Year 2012-13. Therefore, the erstwhile provisions of Section 55A(a) were to be followed. Under the erstwhile provisions, a reference to the Valuation Officer was permissible only if the AO was of the opinion that the value claimed by the assessee was less than its fair market value. In this case, the value adopted by the assessee based on the registered valuer's report was considered to be even higher than the value subsequently determined by the DVO. Consequently, the AO was not empowered to refer the matter to the DVO. The Tribunal held that in the absence of a valid reference to the Valuation Officer, the addition made under the head 'long term capital gains' relating to the cost of acquisition was directed to be deleted. As a result, the primary grounds of appeal became academic. The additional ground of appeal was allowed, and consequently, both appeals were allowed.

The Tribunal partially allowed the assessee's appeal. Regarding the addition under section 50C, the Tribunal noted that the AO proposed to take the full value of consideration at Rs. 5,29,72,000/- (Stamp Valuation Authority's value). However, the AO's subsequent calculation, based on the VO's report, considered the total consideration at Rs. 4,77,32,500/- and the assessee's share at Rs. 2,14,20,000/-. The Tribunal, referencing a coordinate bench decision in identical facts (Tejas Dineshbhai Patel), found that the valuation report of the registered valuer (B.H. Patel) was reasonable and should be given weightage. The Tribunal directed the AO to apply a rate of Rs. 607 per square meter for the calculation of the indexed cost of acquisition for LTCG, considering the land's location in a costly area and the VO's own observation about the location. This decision addresses both grounds as they relate to the valuation and indexation of the capital gain. The addition of Rs. 34,70,000/- under section 50C was implicitly addressed by the revised calculation of LTCG based on the adopted fair market value. The issue of indexation was directly resolved by setting a revised rate for the fair market value as on 01.04.1981.

The Tribunal condoned the 29-day delay in filing the appeal, finding it neither intentional nor deliberate but due to the accountant's fault and casual approach, emphasizing that substantial justice should prevail over technical considerations. Regarding the main issues, the Tribunal held that the amended provisions of Section 55A, which came into effect from 01.07.2013, were not applicable to the transaction of sale of land which occurred during the financial year 2011-12, relevant to Assessment Year 2012-13. Therefore, the erstwhile provisions of Section 55A(a) were to be followed. Under the erstwhile provisions, a reference to the Valuation Officer was permissible only if the AO was of the opinion that the value claimed by the assessee was less than its fair market value. In this case, the value adopted by the assessee based on the registered valuer's report was considered to be even higher than the value subsequently determined by the DVO. Consequently, the AO was not empowered to refer the matter to the DVO. The Tribunal held that in the absence of a valid reference to the Valuation Officer, the addition made under the head 'long term capital gains' relating to the cost of acquisition was directed to be deleted. As a result, the primary grounds of appeal became academic. The additional ground of appeal was allowed, and consequently, both appeals were allowed.

The Tribunal considered the assessee's application for withdrawal of appeals and the revenue's lack of objection. Consequently, the Tribunal dismissed all the assessee's appeals as withdrawn.

The Tribunal held that the lower authorities acted mechanically by confirming additions based solely on Form-26AS entries without verifying the assessee's denial of earning such income. The onus was on the revenue to prove the income, which they failed to do.

The Tribunal held that the assessee is not liable to pay Long Term Capital Gain Tax. The reasoning was that the assessee had invested the entire sale consideration of Rs. 35,72,900/- (which was the declared sale consideration) in specified assets (a new residential house) under section 54F of the Act. The Tribunal noted that even though the AO computed the capital gain by taking the Jantri value of Rs. 50,37,500/- as the sale consideration, the subsequent deduction under section 54F was allowed by the AO. However, the core of the Tribunal's decision was that when the entire sale consideration is invested in a new residential house under section 54F, the provisions of section 50C are not applicable for the purpose of computing capital gains that would be taxable. The Tribunal respectfully followed the decision of the Co-ordinate Bench of the ITAT Jaipur in the case of Prakash Karnawat Vs. ITO, which held that section 50C is applicable for the purposes of section 48 and not for section 54F when the entire sale consideration is invested. Consequently, the addition of Rs. 11,94,518/- was deleted. No issue was expressly left undecided.

The Tribunal held that the capital introduction by partners was sufficiently explained through cheques from a sister concern, and the opening balances of sundry creditors were also largely explained. However, certain sundry creditor balances required further verification.

The Tribunal noted that the assessee had settled the dispute under VSV-20 and received Form-3. Therefore, the appeal was dismissed as withdrawn.

The Tribunal noted the assessee's application under the Vivad se Vishwas Scheme and the request for withdrawal. The Revenue did not object to the withdrawal.

The Tribunal followed a coordinate bench's decision in the assessee's own case, remitting the issue of export incentives to the Assessing Officer for fresh adjudication. The penalty under Section 271(1)(c) was deleted, following a jurisdictional High Court ruling.

The Tribunal followed a coordinate bench's decision in the assessee's own case, remitting the issue of export incentives to the Assessing Officer for fresh adjudication. The penalty under Section 271(1)(c) was deleted, following a jurisdictional High Court ruling.

The Tribunal held that depreciation is allowable on intangible assets acquired through a slump sale, following its own precedent and High Court judgments. The disallowance made by the lower authorities was therefore deleted.

The Tribunal held that the amended provisions of Section 55A were not applicable to the assessment year in question, and the AO had not formed the requisite opinion to refer the matter to the DVO under the erstwhile provisions. Therefore, the addition made by the AO was invalid.

The Tribunal held that the amendment to Section 55A of the Income Tax Act, which came into effect from 01.07.2012, was not applicable retrospectively to the transaction that occurred on 04.06.2012. Furthermore, even under the erstwhile provisions, the AO was not empowered to refer the matter to the valuation officer as the assessee's claimed value was not demonstrably less than the fair market value.

The tribunal noted the assessee's prayer for withdrawal of the appeal under the Vivad Se Vishwas Scheme. The Revenue did not object to the withdrawal.

The Tribunal noted the assessee's prayer for withdrawal under the Vivad Se Vishwas Scheme and that the Revenue had no objection. Consequently, the appeal was treated as withdrawn.

The Tribunal noted that the assessee had filed FORM-3 under the Vivad Se Vishwas scheme and prayed for withdrawal of the appeal. The Revenue did not object to the withdrawal.

The Tribunal upheld the deletion of the addition, finding that the seized papers lacked cogent evidence and were not in the assessee's possession. The Tribunal noted that similar additions in co-owners' cases were also deleted and upheld by the Tribunal.

The Tribunal dismissed the appeal as withdrawn, granting liberty to both parties to file a miscellaneous application for restoration if the VSVS application does not get finally settled.

The Tribunal affirmed the CIT(A)'s order, holding that the gain from the cancellation of the forward contract, entered into for hedging foreign exchange on a loan for acquiring capital assets, was a capital receipt. The Tribunal found no infirmity in the CIT(A)'s decision.

The Tribunal dismissed the appeal as withdrawn, granting liberty to both parties to seek restoration if the VSVS-20 application was not finally settled. The Assessing Officer was directed to pass consequential orders upon issuance of Form-3.

The Tribunal upheld the CIT(A)'s decision to estimate GP at 1.5% and confirmed the disallowance of labour expenses where TDS was not deducted. The addition for unexplained investment was restricted by the CIT(A) considering the opening balance, which the Tribunal found no reason to vary.

The Tribunal upheld the addition of Rs. 80 lakh received from Surpriya Fincom Pvt. Ltd. as share capital/premium, considering it an accommodation entry. The addition of Rs. 42,000 as commission on this amount was also confirmed.

The Tribunal noted a discrepancy in the appeal number mentioned in the VSV-20 application and directed rectification. Considering the settlement under VSV-20, the appeal was dismissed as withdrawn.

The Tribunal held that the exchange rate difference on the return of share application money is capital in nature and not allowable as revenue expenditure. The PCIT's order under section 263 was found to be correct.

The Tribunal held that the PCIT's assumption of the disclosed amount being Rs. 210 crores was based on suspicion and conjecture, lacking supporting material. The AO had conducted sufficient inquiries regarding the Rs. 2.10 crores disclosure, and the original assessment order was neither erroneous nor prejudicial to the revenue.

The Tribunal noted the assessee's intention to settle the dispute under the Vivad Se Vishwas scheme and directed rectification of the appeal number in the application. The appeal was dismissed as withdrawn, with liberty to restore it if the VSV settlement was not finalized.

The Tribunal considered the assessee's application and the Revenue's no objection. It was held that since the dispute was settled under the Vivad se Visvas Scheme, the appeal is dismissed as withdrawn.

The tribunal dismissed the appeal regarding the addition of notional rent for the Mumbai property, finding the assessee failed to provide evidence of its business use. The appeal concerning the disallowance of cash expenditure was also dismissed, affirming the CIT(A)'s 10% disallowance as reasonable. Depreciation on two cars was allowed, while depreciation on the third car was disallowed.

The Tribunal noted the assessee's application for withdrawal under the Vivad Se Vishwas Scheme and the lack of objection from the Revenue. Consequently, the appeal was treated as withdrawn.

The Tribunal condoned the delay, stating that the assessee should not be penalized for the AO's mistake and that substantial justice should be preferred. The Tribunal set aside the CIT(A)'s order and remitted the matter back for fresh adjudication.

The Tribunal upheld the CIT(A)'s deletion of additions, stating that the Revenue failed to provide sufficient evidence to prove the transactions were bogus or that the assessee earned income. Suspicion alone cannot replace evidence.

The Tribunal noted that the assessee had prayed for withdrawal of the appeals to avail the Vivad Se Vishwas scheme. The Revenue did not object to the withdrawal.

The Tribunal held that the AO failed to examine the identity, creditworthiness, and genuineness of the transactions related to share application money and share premium. This failure made the assessment order erroneous and prejudicial to the revenue's interest, thus upholding the PCIT's revision order.

The Tribunal upheld the CIT(A)'s deletion of additions, stating that the Revenue failed to provide sufficient evidence to prove the transactions were bogus or that the assessee earned income. Suspicion alone cannot replace evidence.

The Tribunal noted that the assessee had prayed for withdrawal of the appeals to avail the Vivad Se Vishwas scheme. The Revenue did not object to the withdrawal.

The Tribunal upheld the CIT(A)'s deletion of additions, stating that the Revenue failed to provide sufficient evidence to prove the transactions were bogus or that the assessee earned income. Suspicion alone cannot replace evidence.

The Tribunal considered the assessee's application for withdrawal and the Revenue's lack of objection. Consequently, the appeal was dismissed as withdrawn.

The Tribunal considered the assessee's applications and the Revenue's lack of objection. Consequently, all three appeals filed by the assessee were dismissed as withdrawn.

The Tribunal considered the assessee's applications and the Revenue's lack of objection. Consequently, all three appeals filed by the assessee were dismissed as withdrawn.

The Tribunal considered the assessee's applications and the Revenue's lack of objection. Consequently, all three appeals filed by the assessee were dismissed as withdrawn.