ITAT Visakhapatnam Judgments — October 2019

The Tribunal held that the AO lacked specific evidence linking the general information about CCM irregularities to the escapement of income in the assessee's case. Following the Bombay High Court's decision in Pelican Portfolio Services Pvt. Ltd., the Tribunal found the reopening invalid.

The Tribunal held that the revenue's appeal did not fall under the exceptions of Board Circular No. 3/2018 as the revision under section 263 was based on an audit objection to the original assessment. On merits, the Tribunal found no error in the CIT(A)'s deletion of the addition.

The Tribunal upheld the CIT(A)'s order on most grounds, including disallowance of rent under Section 40(a)(ia) and depreciation on library books. Some grounds were dismissed as not pressed or for lack of evidence. The Tribunal found no infirmity in the CIT(A)'s orders on the confirmed additions.

The Tribunal upheld the CIT(A)'s decision, following its own prior ruling that the amortisation on goodwill was rightly allowed. The Tribunal also addressed various grounds raised in the assessee's cross-objections concerning carry forward of losses, TDS credit, and interest.

The Tribunal held that the CIT(A) was justified in allowing depreciation on goodwill, following its own previous orders. The Tribunal also addressed various grounds raised in the cross-objections filed by the assessee.

The Tribunal held that the order passed by the CIT under Section 263 was unsustainable as it was passed without giving the assessee an opportunity of being heard, violating principles of natural justice.

The Tribunal held that the Principal Commissioner's revisionary order under Section 263 was invalid because the AO had not made an erroneous or prejudicial assessment. The AO had acted diligently by referring the matter for valuation.

The Tribunal held that the AO lacked specific evidence linking the general information about CCM irregularities to the escapement of income in the assessee's case. Following the Bombay High Court's decision in Pelican Portfolio Services Pvt. Ltd., the Tribunal found the reopening invalid.

The Tribunal held that the assessee was not given sufficient time to respond to the notices and provide the necessary information. Therefore, the matter was remitted back to the CIT(E) for a fresh examination.

The Tribunal held that employee's PF contributions are deductible if remitted before the due date of filing the return of income. This decision aligns with previous rulings of the Tribunal and High Courts.

The Tribunal held that the CIT(A) was justified in allowing depreciation on goodwill, following its own previous orders. The Tribunal also addressed various grounds raised in the cross-objections filed by the assessee.

The Tribunal upheld the CIT(A)'s order on most grounds, including disallowance of rent under Section 40(a)(ia) and depreciation on library books. Some grounds were dismissed as not pressed or for lack of evidence. The Tribunal found no infirmity in the CIT(A)'s orders on the confirmed additions.

The Tribunal held that the Transaction Net Margin Method (TNMM) is the most appropriate method for benchmarking royalty payments at the entity level, including all transactions. The Tribunal found that the assessee derived benefits from the technical information and that the TPO erred in applying the benefit test instead of prescribed methods.

The Tribunal held that TDS was applicable on lease rentals paid after the amendment to Section 194I and on transmission/SLDC charges as royalty under Section 194J. However, for AY 2010-11, a lower deduction certificate under Section 197 was binding.

The Tribunal found that the Assessing Officer should have quantified the excess payment rather than making an ad-hoc disallowance. The Tribunal reduced the disallowance further from 15% to 10% of the expenditure.

The Tribunal held that the assessee is eligible for deduction under Section 54F even if the construction of the new house commenced before the transfer of the original asset, provided it is completed within the stipulated period. The Tribunal also found that the sale of plots in this case was not business income.

The Tribunal held that the Supreme Court's decision in Palam Gas Service mandates TDS even on payments already made, making the disallowance under Section 40(a)(ia) applicable. The case was remitted back to the CIT(A) for fresh adjudication on merits.

The Tribunal held that the Transaction Net Margin Method (TNMM) is the most appropriate method for benchmarking royalty payments at the entity level, including all transactions. The Tribunal found that the assessee derived benefits from the technical information and that the TPO erred in applying the benefit test instead of prescribed methods.

The Tribunal held that since the assessee had disclosed all material facts during the original assessment, reopening the assessment after four years under section 147 was invalid. The subsequent assessment order was therefore quashed.

The Tribunal held that the addition for payments to Progressive Constructions Ltd. was justified due to non-substantiation. However, the addition for non-deduction of TDS on payments to Raghava & Co. was deleted as the payments were considered sub-contract payments. The Tribunal also upheld the addition on account of unexplained creditors.

The Tribunal confirmed the addition of Rs. 5,37,236/- related to advances accepted during the relevant year, as the assessee failed to provide details. However, the addition of Rs. 1,80,60,116/- representing trade advances was deleted as the assessee discharged its burden.

The Tribunal held that since the assessee had been granted exemption in previous years and its application for registration was pending, the CPC's action of treating gross receipts as taxable income was incorrect. The Tribunal followed precedents stating that non-consideration of a registration application within the prescribed time leads to deemed registration.

The Tribunal held that the addition for payments to Progressive Constructions Ltd. was justified due to non-substantiation. However, the addition for non-deduction of TDS on payments to Raghava & Co. was deleted as the payments were considered sub-contract payments. The Tribunal also upheld the addition on account of unexplained creditors.